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TRANSCRIPT OF PROCEEDINGS

O/N 14578
AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

VICE PRESIDENT LAWLER

AG2004/7918

APPLICATION FOR CERTIFICATION

OF AGREEMENT

Application under section 170LJ of the
Act
by the Australian Postal
Corporation and
Others for
certification of the Australia Post
Enterprise Agreement 2004

SYDNEY

9.10 AM, WEDNESDAY, 27 OCTOBER
2004

PN1

MR R. REITANO: I appear for the
CEPU.

PN2

MR M.W. TEHAN: I seek leave to appear and
consent to Mr Reitano, sir.

PN3

MR P. INGWERSEN: Also on behalf of the
Community and Public Sector Union.

PN4

THE VICE PRESIDENT: Yes, there is no
objection to leave being granted to Mr Reitano, Mr Tehan, I
imagine?

PN5

MR TEHAN: No.

PN6

THE VICE PRESIDENT: No, there being no
objection, leave is granted. Who is going first, Mr Tehan.

PN7

MR TEHAN: Your Honour, Australia Post comes
to the Commission today to seek certification of a new enterprise agreement
which will cover the vast majority of its staff. It covers all of Australia
Post's employees, approximately 35,000, except for about 2500 managerial
employees who are not covered by the relevant award and about 120 employees
engaged in the post logistics side of the business, they are covered by a
separate enterprise agreement which is currently being negotiated.

PN8

The Australia Post Enterprise Agreement 2004
is the sixth enterprise agreement which has been negotiated between the
major parties within Australia Post and it is referred to colloquially as
"EBA6". The agreement has to be seen, your Honour, in the context of the
relationship between Australia Post and its staff and authority for that is
to be found in Vice President Ross's decision in Ballantyne, the assessment
of whether a matter pertains to the requisite relationship between employers
and employees must be done in context.

PN9

His Honour had referred to the judgment of
McHugh J and Electrolux where his Honour has referred to the relationship
between the employer bound by the agreement and all persons employed in the
single business of that employer, it is not a general agreement, so the
agreement needs to be looked at in the context of Australia Post. It is a
product, your Honour, of hard negotiations, punctuated by some industrial
action.

PN10

Australia Post is one of Australia's best
known brands, best known corporations and relevantly for the Commission it
is one of Australia's largest employers, employing as I said earlier, nearly
35,000 employees. Nearly 25,000 are full-time and nearly 9000 are part-time.
39 per cent are women.

PN11

It is one of Australia's largest Indigenous
employers, your Honour, with approximately 576 Indigenous Australians
working for it. Approximately 20 per cent of employees come from a
non-English speaking background - this is set out in the statutory
declaration of the relevant parties. It is a huge business, your Honour, 19
million pieces of mail are sorted each day
- - -

PN12

THE VICE PRESIDENT: I think strictly, Mr
Tehan, there is only - let me just check that - I think I only have a draft
statutory declaration - - -

PN13

MR TEHAN: No, I'm going to tender a number
of statutory declarations and then seek relief under rule 6 from the
provisions of the rules about filing documents
- - -

PN14

THE VICE PRESIDENT: You can have that,
yes.

PN15

MR TEHAN: Yes, your Honour, I will tender
those in a moment, if that is all right. We provided to your Honour a draft
statutory declaration and the declaration follows the draft so that you are
aware of that. There is a complex retail business which needs to be noted,
which served 1.1 million customers per day.

PN16

So your Honour it is a very large business,
complex with a large number of employees and it is with significant pleasure
that Australia Post is able to come to the Commission with an agreement
which has been hammered out with the relevant unions, but with all of its
matters touching on the requisite employer/employee relationship. Your
Honour, can I tender a number of documents which need to be provided to you
at this stage?

PN17

THE VICE PRESIDENT: Yes, thanks, Mr
Tehan.

PN18

MR TEHAN: Then perhaps deal with some
questions that you might have. First, your Honour, may I tender the original
enterprise agreement and six copies of it. Your Honour, I now seek to tender
the original statutory declarations of David Hugh Barker for and on behalf
of Australia Post. The CEPU certified agreement - a declaration, I beg your
pardon, your Honour, made by Brian Baulk, on behalf of the
CEPU.

PN19

THE VICE PRESIDENT: Mr Tehan, I will mark
one of the copies, not the original, one of the copies of the
agreement.

EXHIBIT #1 COPY OF
ORIGINAL AGREEMENT

PN20

MR TEHAN: Thank you, your Honour.

EXHIBIT #2 ORIGINAL STATUTORY DECLARATION
OF DAVID BARKER

PN21

THE VICE PRESIDENT: I'm assuming that if
anyone has any objection to this they will speak up.

PN22

MR TEHAN: The next statutory declaration I
wish to file with you, your Honour, is a statutory declaration of Mr Paul
Ingwersen, who of course is here at the bar table and six copies of his
declaration on behalf of the CPSU, the other major union which is party to
the agreement.

EXHIBIT #3 STATUTORY DECLARATION OF MR
PAUL INGWERSEN

PN23

MR TEHAN: The third statutory declaration,
your Honour, is the APESMA declaration and it is made by Mr Geoff
Fary.

PN24

THE VICE PRESIDENT: You don't need to hand
up multiple copies of this, Mr Tehan, unless you wish to.

PN25

MR TEHAN: No, that is all right, thank you,
your Honour.

PN26

THE VICE PRESIDENT: I suppose it means the
slaughtering of trees has occurred in any event.

PN27

MR TEHAN: They are slaughtered but they will
be pulped.

PN28

THE VICE PRESIDENT: Yes, thank you.

EXHIBIT #4
STATUTORY DECLARATION OF GEOFF FARY

PN29

MR TEHAN: The fifth and final stat dec I
wish to tender, your Honour, is one by the AMWU made by Mr Julius
Roe.

EXHIBIT #5
STATUTORY DECLARATION OF JULIUS ROE

PN30

MR TEHAN: Your Honour, there were a number
of documents which were referred to in the agreement at various places and I
wanted to hand those up because they are incorporated by reference and I
thought that would be helpful.

PN31

THE VICE PRESIDENT: Thank you, Mr Tehan,
that is the appropriate course.

PN32

MR TEHAN: The first is the Australia Post
Principle Determination - how many copies did you want of
- - -

PN33

THE VICE PRESIDENT: One of each is fine,
thank you, Mr Tehan.

PN34

MR TEHAN: Yes, your Honour. The Australia
Post Principle Determination, a piece of subordinate legislation made under
section 89 of the Australian Postal Corporation Act.

EXHIBIT #6
AUSTRALIA POST PRINCIPLE DETERMINATION

PN35

MR TEHAN: That is referred to, your Honour,
for the sake of completeness, at point 2 of attachment A - which I think is
referred to at clause 4.6 of EBA6. I'm sorry, your Honour, I am just handing
out these documents. Have I tendered the CEPU declaration by Mr
Baulk?

PN36

THE VICE PRESIDENT: No.

PN37

MR TEHAN: I beg your pardon. Here is a copy
of Mr Baulk's statutory declaration made on behalf of the CEPU.

EXHIBIT #7
STATUTORY DECLARATION OF MR BAULK

PN38

MR TEHAN: The next document, your Honour, is
the Australia Post Code Of Ethics, which forms the basis of the discipline
process within Australia Post and it is referred to at clause
10.

PN39

THE VICE PRESIDENT: I think annexure A as
well, or attachment A.

PN40

MR TEHAN: And annexure A,
yes.

PN41

THE VICE PRESIDENT: Yes.

EXHIBIT #8 CODE OF
ETHICS OF AUSTRALIA POST

PN42

MR TEHAN: Attachment A - point 10 of
attachment A. Clause 7.6 refers to a Competency Framework Assessment Policy,
your Honour, and I thought it would be appropriate to tender
that.

PN43

THE VICE PRESIDENT: Thank you.

EXHIBIT #9 COMPETENCY FRAMEWORK
ASSESSMENT POLICY

PN44

MR TEHAN: Clause 5.1 of EBA6, your Honour,
refers to the Australia Post Occupational Health and Safety Policy
Agreement, and I wanted to tender that.

EXHIBIT #10 AUSTRALIA POST OCCUPATIONAL
HEALTH AND SAFETY POLICY
AGREEMENT

PN45

MR TEHAN: There's a reference to the HR
Manual, Rates of Pay document which is referred to in clause
10.1.

EXHIBIT #11
AUSTRALIA POST HR MANUAL, RATES OF PAY

PN46

MR TEHAN: Your Honour, there is a reference
in clause 4.6 to the Australia Post Redundancy, Redeployment, and Retraining
Agreement (1995), an agreement of the Commission but incorporated by
reference in that way, and we would seek to tender that document as
well.

EXHIBIT #12 COPY OF THE AUSTRALIA POST
REDUNDANCY, REDEPLOYMENT, AND RETRAINING AGREEMENT
(1995)

PN47

MR TEHAN: Finally, your Honour, during the
course of the negotiations, there was a large volume of correspondence which
was passed between the parties concerning relevant issues and giving
assurances, and the parties seek to tender these documents for the sake of
completeness and for mutual comfort between them and we do seek to tender
that bundle of documents marked, without prejudice, EBA6, Australia
Post-associated letters.

PN48

THE VICE PRESIDENT: The other parties have
no objection to that course?

PN49

MR INGWERSEN: No, your Honour. We have, in
fact, agreed that it be tendered at the hearing.

PN50

THE VICE PRESIDENT: Mr Reitano, you have no
objection?

PN51

MR REITANO: No objection.

EXHIBIT #13 BUNDLE
OF CORRESPONDENCE

PN52

THE VICE PRESIDENT: I note, Mr Tehan, that
it is headed "Without Prejudice."

PN53

MR TEHAN: Yes, that can be ignored, your
Honour.

PN54

THE VICE PRESIDENT: I will delete the
reference to "Without Prejudice."

PN55

MR TEHAN: Yes, it was during the
negotiations that it was "Without Prejudice" but
- - -

PN56

THE VICE PRESIDENT: Yes.

PN57

MR TEHAN: Your Honour, I think that
concludes the formalities there and perhaps the introduction. After the
Electrolux decision came down, your Honour, the parties met again to delete
certain provisions which would have been otherwise agreed and the agreement
which comes to you, we think, meets the tests. Mr Reitano might want to put
some submissions to you. You might have some questions you might wish to ask
of the parties and we are happy to deal with those as you see
fit.

PN58

THE VICE PRESIDENT: Thank you, Mr Tehan. I
do have some issues I will raise with you, and then seek any response or
submission from Mr Reitano and Mr Ingwersen. Initially, I had a concern
about the definition - I withdraw that - the effective clause 16, in
particular clause 16.1(c) and whether or not the description of employees in
classifications specified in the following awards or any successor awards
describe a group of employees that match the description required by section
170LI(1)(b), but on the basis of the submissions you have made, I'm
satisfied that this agreement applies to all of the employees which needs to
be read as excluding, necessarily, senior management in a part of the
business or parts of the business of Australia Post, namely all those parts
apart from the postal logistic section of Australia Post.

PN59

I note that in clause 15.3, there's a
definition of the expression "the Parties" with a capital "P". I can't see
that, in fact, the expression "the Parties" with a capital "P" is actually
used in the agreement, but there are frequent references to "the parties"
with a lower case "p" and I assume that as a matter of proper construction,
the term "the Parties" with a capital P in clause 15.3 is, in fact, meant to
refer to the various references to the words "the parties" with a lower case
"p"?

PN60

MR TEHAN: Yes, it does, your
Honour.

PN61

THE VICE PRESIDENT: The definition in clause
15.3 means the parties referred to in clause 16.1 of the agreement - that,
of course, is Australia Post, the four relevant unions, and relevantly (c)
employees in classifications specified in a number of enumerated awards.
This is an agreement made pursuant to section 170LJ, which describes an
agreement between an employer and unions, and I think strictly speaking,
there's a problem with seeking to incorporate the employees as parties, as
distinct from being bound by the agreement.

PN62

MR TEHAN: I think one hesitates to be too
precise about these sorts of errors. It is probably meant to say "in respect
of" employees, "in respect of" (c), all employees of Australia Post in the
classifications specified. I mean, that is the - it is an LJ agreement, your
Honour, but you can't go writing words into the agreement.

PN63

THE VICE PRESIDENT: No, but it is clear that
the parties were intending to make an LJ agreement, and that the definition
is to be read as the contract law equivalent of a slip rule
correction.

PN64

MR TEHAN: Yes.

PN65

THE VICE PRESIDENT: Do you have a problem
with that, Mr Reitano? You are frowning.

PN66

MR REITANO: I'm not sure what the debate is
about because 16.1 tells you who the agreement is binding on. That, of
course, can't override the Act. The Act tells you who the agreement is
binding on but the reference in - - -

PN67

THE VICE PRESIDENT: Yes, and 16.1 is
consistent with the Act, but the definition of "the parties" in clause 15.3
is not strictly consistent with - - -

PN68

MR REITANO: Why? 15.3 means the parties
referred to in clause 16.1. Who are the parties in 16.1? The parties are the
four relevant unions and Australia Post. They can be the only parties that
are referred to in that clause as a matter of the construction of the Act
and the agreement. If it said "the persons referred to in 16.1"
- - -

PN69

THE VICE PRESIDENT: Mr Reitano, I accept
that that is a compelling argument on the proper construction of the
agreement. The expression means the parties referred to in clause 16.1 means
those legal entities listed in 16.1 which are parties to the agreement,
yes.

PN70

MR REITANO: Yes.

PN71

THE VICE PRESIDENT: Thank you. In clause
15.4, there's a definition for the expression "term" as meaning the term of
the agreement being from the date of certification to the date of expiry,
notwithstanding the provision of section 170LX of the Workplace Relations
Act (1996). It struck me that that definition, applied strictly, may have
consequences that were not intended by the parties if it is applied to the
word "term" in clause 8.1 and clause 11.2. Have the parties turned their
minds to whether or not the obligations imposed by clauses 8.1 and 11.2 are
supposed to continue for the whole of the period that the agreement remains
operative pursuant to the Act, including the extended operation given by
section 170LX, or do they intend those obligations to terminate upon the
expiry of the passage of the nominal expiry date of the
agreement?

PN72

MR TEHAN: I have obtained some instructions
on that point, your Honour, and the answer is the latter of the two
propositions, that they intended that the obligation will expire on the
expiry of the term. The reason - - -

PN73

THE VICE PRESIDENT: The nominal
term?

PN74

MR TEHAN: The nominal term. The agreement
will continue in force under LX, of course, but the intention of the parties
was to recognise that a number of concessions were made on both sides during
the negotiations, and one of the important concessions that was made by the
CEPU was a clear recognition that there would be no industrial action during
the term of the agreement, and Australia Post's major concession was the
arbitration clause under section 111AA or elsewhere. Australia Post said:
well, we will certainly maintain all these expired conditions that are there
for the term. It may be that we will get rid of a number of them after the
term is over.

PN75

We might be free to make some applications.
Whether we will succeed in applications is another question because, as you
will have seen, the reference to a number of the previous conditions in
attachment A are very old conditions. Some of them are expired and
irrelevant, and Australia Post wanted to clean them up. The unions were
reluctant to do that.

PN76

THE VICE PRESIDENT: Anyway, your position is
noted and you say that the strict meaning of the words when the definition
of the word "term" is applied is what was intended by Australia Post. Mr
Reitano and Mr Ingwersen, does it matter whether the union part is agreed or
disagree with that? The question of any issue of construction will, no
doubt, arise if and when there's some dispute about it, and nothing that can
be said today can, I think, obviate the need for some debate at some stage
if and when the point is taken, but if you wish to indicate what the
position of the unions is, please feel free.

PN77

MR REITANO: I think the safe course is not
to say anything. Given that I don't have my client here at the moment, our
understanding - that is, as the lawyers at the Bar table - is not different
from what Mr Tehan has put.

PN78

THE VICE PRESIDENT: Well, the next matter
that I wanted to raise was in relation to clause 12.3(f) of the agreement. I
note that there was a document issued on 29 September, 2004 notifying the
relevant portions of the workforce of Australia Post of a change to that
particular part of the agreement from the document that was distributed to
employees, although that change occurred before the vote. As I understand
it, it occurred well before the vote, such that there were no difficulties
with the time periods. It seems to me that the strict legal position is that
the Commission, as a creature of statute, has no jurisdiction or power to do
anything which is not authorised ultimately by the Workplace Relations Act
or some other piece of Commonwealth legislation.

PN79

Section 170LW of the Act and section 111AA
of the Act set out the extent of the ambit of the Commission's power or
jurisdiction to act as a private arbitrator. So far as the amended paragraph
f(i) is concerned, I don't see how there's any scope for the Commission to
conduct a private arbitration, other than pursuant to paragraph (e) of
clause 12.3 or pursuant to the binding recommendation process in section
111AA of the Act. I just flag that. I don't this is an impediment to
certification. If the parties wish to place any position on the record, they
should feel free to do so.

PN80

MR TEHAN: I think our position, your Honour,
is that the reference to private arbitration in clause 12.3(f)(i) is a
reference to the arbitration referred to in clause 12.3(e).

PN81

THE VICE PRESIDENT: Well, the problem with
that proposition, Mr Tehan, is that the arbitration referred to in clause
12.3(e) is strictly a private arbitration. That was the very gist of the
private arbitration case in the High Court, so that when the Commission is
exercising an arbitral power pursuant to a dispute settlement agreement in a
certified agreement, it is doing so qua a private arbitrator, so there is no
distinction between an arbitration conducted in accordance with subclause
12.3(e) and a private arbitration. An arbitration conducted pursuant to
subclause 12.3(e) is a private arbitration.

PN82

Again, I don't think this is an impediment
to certification but I simply flag it in order to provide the parties with
an opportunity as to what to put on the record and what they intended to the
extent that that may assist in the event there was ever any dispute about
what this clause is supposed to do. So Mr Tehan, I interrupted
you.

PN83

MR TEHAN: Your Honour, I think rather than
try to say something now, it might be better for the parties to - if this
clause needs to be triggered, that the parties will work out a process at
some point, perhaps at the assistance of the Commission rather than try to
hammer it out now, particularly if it is not an impediment to
certification.

PN84

MR REITANO: I think for our part I had
better say that the purposes of the clauses, whether you divide them up in
the way that your Honour has done or whether you look at them, to use the
words of another member of the Commission, "holistically" is to give the
Commission the widest possible power, whether it be by formal arbitration
under the Act, under 111AA, under LW or in its industrial dispute formal
mode of dealing with matters, to give it the widest possible role that it
can in dealing with disputes between the parties. That is the intention,
whether it be arbitral or private arbitration.

PN85

THE VICE PRESIDENT: Thank you, Mr Reitano.
Yes, Mr Ingwersen?

PN86

MR INGWERSEN: Could I say, for the record,
that this clause was a matter of very substantial discussion between the
parties as a result of some, I suppose, compromise - as a way to move
forward, and it was designed to give a broad scope for the resolution, and
all parties to the agreement were effectively consenting that there would be
an ability for private arbitration to deal with matters that may arise as
dispute whilst the agreement is in place.

PN87

THE VICE PRESIDENT: Fine. Thank you, Mr
Ingwersen and Mr Tehan. I don't think there's any necessity to say anything
further unless you wish to. I also flag that clause 14.3 which purports to
extend the operation of the dispute resolution procedure in clause 2 to any
industrial dispute arising during the life of the agreement relating to the
employees covered by the agreement. I just flag that there may be some
difficulty with - well, not "may." My provisional view is that there is
difficulty with that clause having any effective operation for this reason -
that the Commission's power to act as a private arbitrator, its jurisdiction
to act as a private arbitrator, pursuant to the dispute settlement
procedure, is limited by the terms of section 170LW and various Full Bench
decisions in settling disputes over the application of the
agreement.

PN88

On the face of it, any industrial dispute
arising during the life of the agreement is a form of words apt to cover
disputes which will be outside that class described as "disputes" over the
application of the agreement, in which case clause 14.3 is subject to the
jurisdictional limitation under section 170LW. I have considered whether or
not this matter ought to induce me to incline to approve the empowerment of
the Commissioner's private arbitrator pursuant to section 170LW, and I have
determined that it should not act as such an impediment.

PN89

I again flag that for the parties, and if
you wish to put anything on the record, please feel free to do so. Now, in
relation to the question of matters pertaining, can I simply flag a series
of clauses or topics on which I would invite some submissions, bearing in
mind that the probable - the almost certain consequence of the Commission
certifying or purporting to certify an agreement that contains a substantive
clause that does not pertain to the relationship specified in section 170LI
of the Act and which is not properly characterised as incidental or
ancillary is that the agreement has no effect at all, or the certification
has no effect at all at law and the agreement has no operation as a
certified agreement.

PN90

That would appear to flow from the reasoning
of the High Court in Badwaj, and certainly the Full Court of the Federal
Court in Mine Management Proprietary Limited has determined that effect in
relation to a jurisdictional error found in that appeal in relation to the
certification of a decision. For that reason, the Commission does the
parties no service to certify an agreement that contains a clause that, in
the Commission's view, falls into that category of substantive clauses that
are not incidental or ancillary and do not pertain to the requisite
relationship.

PN91

In summary, clause 3.1, through to clause
3.3 set up a regime and principles for consultation. At various points in
the agreement it is probably not necessary to list them. The agreement casts
an obligation on Australia Post to consult either with the named unions or
with the unions generically or with the parties, the parties I think
relevantly for the reasons articulated by Mr Reitano, effectively meaning
the unions. My provisional view is that the approach of Vice President Ross
in the Ballantyne matter ought be followed by me as a matter of comity until
a Full Bench has had an opportunity to pronounce upon the matter and in
relation to consultation the approach determined as correct by his Honour
appears to be that one looks at the actual words of a clause and construes
them in context.

PN92

You ascertain, by reference to the
construction of the words, the matter that the clause is about and then you
ask the question whether that matter pertains to the relationship between
the employees as such in the particular business. To the extent that the
clause is about a matter that so pertains it is permissible for the clause
to include a requirement for consultation with unions. That is, the mere
fact that a clause requires consultation with unions does not automatically
render the clause anon about a matter that does not pertain to the requisite
relationship and I think his Honour refers to the standard clause for
inclusion in awards that was produced by the termination and change of
redundancy case by the Full Bench in that case specifically requiring
consultation with unions as an example of that particular
process.

PN93

The parties can either leave it to me make a
determination myself as to whether or not that analysis applies favourably
for each of the occasions that the agreement specifically requires
consultation or they can take me through those various parts and explain why
those clauses ought to be characterised as being about a matter that
pertains to the relationship, the obligation to consult therefore being
simply part of that - part of the way the agreement deals with the
pertaining matter. That is the first point. So the second point is clause
3.5. The first sentence of clause 3.5 raises the issue of - sorry clause 3.5
raises the issue of right of entry.

PN94

There is a divergence in the authorities as
to whether or not right of entry is itself a matter that pertains to the
requisite relationship. It seems to me that, on any view, if a right of
entry clause in a certified agreement confines the right of entry to
purposes which are within the concept of pertaining the requisite
relationship then the clause is permissible because it is properly
characterised as incidental even if right of entry even of itself, does not
pertain to the requisite relationship. The only difficult I have with clause
3.5 was the expression: particular circumstances, in the second sentence of
clause 3.5, and whether or not that expressions gives an operation to clause
3.5 which extends beyond pertaining matters. Say, for example, the matters
of politics or union elections or whether it is properly seen as being
confined to pertaining matters.

PN95

No doubt, Mr Reitano, you would wish to
argue that right of entry is a matter that pertains. Thirdly, I seek some
submissions on clause 6.25 and the associated following clause. Fourthly,
I'd seek some submissions on clauses 9.4 through to 9.15. It is clear that
9.4 is an attempt to render as a relevantly pertaining matter by reference -
I withdraw that. It is clear that 9.4 is an attempt to make explicit through
the words of the agreement, the way in which clauses 9.5 through to 9.15
pertain. However, I have some discomfort about whether some or all of those
clauses can properly be characterised as being about matters that pertain to
the requisite relationship when they appear rather to relate to matters of
business structure and management strategy. Those are the only matters on
which I seek some submissions.

PN96

There are issues obviously that arise in
relation to this agreement. For example, clause 13: salary sacrifice might
be seen by some to be contentious given the endorsement of the narrow
approach in Portus and Alcan by the High Court in Electrolux. However, it
seems to me that salary sacrifice is a ubiquitous incident of modern
employment and it would simply be a matter of absurdity to suggest that a
clause which is about salary sacrifice does not pertain to the requisite
relationship necessarily because of the decision in Electrolux any attempt
to include deduction of union dues in a salary sacrifice provision will be
bad but that is not the effect of clause 13 of this agreement and I have no
difficulty with it.

PN97

Clause 11 is a clause about which there may
have been some argument but it seems to me that that clause is clearly
incidental or ancillary and it is directed towards maintaining the
effectiveness of the agreement. Yes, who would like to go
first?

PN98

MR REITANO: Can I deal with what I think may
be the two easy ones first?

PN99

THE VICE PRESIDENT: Yes.

PN100

MR REITANO: One of the difficulties in
presenting submissions in this way is that I don't have an opponent and it
makes it difficult in terms of envisaging what
- - -

PN101

THE VICE PRESIDENT: Well, I'm your effective
opponent for practical purposes, Mr Reitano
- - -

PN102

MR REITANO: I understand
that.

PN103

THE VICE PRESIDENT:
- - - because I need to ensure that my statutory duty is
discharged and therefore I would seek to look critically at whatever
arguments you advance.

PN104

MR REITANO: I understand that, but I say
that in the sense that no one is fully articulating a case against what I'm
saying so one has to anticipate what the arguments are. Could I go to 3.5
first - - -

PN105

THE VICE PRESIDENT: Yes.

PN106

MR REITANO: - - - because I
think it illustrates two points that might be relevant to some of the other
things that I want to say?

PN107

THE VICE PRESIDENT: The first sentence of
3.5 in effect is simply what it says: an acknowledgment. There is no term,
if you like, or enforceable agreement contained in the first sentence. It is
an acknowledgment of the bleeding obvious in one sense. That is, what is
found in the Work Place Relations Act in respect of right of entry. The
second sentence needs to be read carefully, because if one reads it as
quickly as I think your Honour may have, you can very much be mis-lead into
believing that it is about something that it is not about.

PN108

THE VICE PRESIDENT: Yes, you are going to
point to "may agree" which means it simply again a statement of the bleeding
obvious that in the future the parties "may agree" about
something.

PN109

MR REITANO: That is right. That is the first
point, yes.

PN110

THE VICE PRESIDENT: Yes, that is correct. I
accept that as absolutely correct, yes.

PN111

MR REITANO: The second point that arises is
that it is very narrow in its scope. It is not a right of entry provision at
all. If one keeps going:

PN112

...may agree on workplace access
arrangements involving union officials which assist the consultative
process.

PN113

So it is very much not a right of entry
provision but it is something that takes you back to one of the clauses that
your Honour raised, 3.1 and the detailed prescription in relation to
consultation. They are only agreeing on access arrangements for union
officials which assist in the process of consultation that is otherwise
articulated in the agreement.

PN114

THE VICE PRESIDENT: See, the reason why this
becomes a little bit complicated, Mr Reitano, is because - and I don't have
the authorities at my finger tips, but there is a debate about whether or
not section 285(c) can operate when there is a certified agreement in place.
The argument runs, as I understand it, that under 285(b), the right of entry
specifically extends to inspection for the purposes of checking compliance
with certified agreements, whereas in 285(c), there is no reference to
certified agreements. The argument runs a specific omission of something
that is elsewhere in the same general area of the Act. "Specifically
included" means that the Parliament intended that.

PN115

MR REITANO: But with respect, there would be
nothing that would - and I don't think the authorities deal with this and I
don't think they need to, there would be nothing that would prevent the
parties from - assuming that it relevantly pertains, which is what I thought
I was dealing with.

PN116

THE VICE PRESIDENT: I'm sorry, we are at
cross purposes here.

PN117

MR REITANO: Yes.

PN118

THE VICE PRESIDENT: We are at cross purposes
here. Yes, I have diverged to a different issue. You are simply asserting
that the acknowledgment is there and that this clause effectively has no
binding legal effect, put aside the last sentence for a
moment.

PN119

MR REITANO: Yes.

PN120

THE VICE PRESIDENT: I was simply flagging
that it may not in fact have the effect that you are contending for, for the
reason that I have articulated.

PN121

MR REITANO: Right, I'm sorry, we were at
cross purposes, your Honour. There is another issue that arises on 285(c)
that I think is right. I am doing this on the run, assisted by Mr Pasfield,
that of course, 285(c) would continue to apply in respect of these parties
because the certified agreement here does not purport to oust the whole of
the relevant awards - - -

PN122

THE VICE PRESIDENT: Yes.

PN123

MR REITANO: - - - and so our
right of entry in respect of consultation would survive the awards
anyway.

PN124

THE VICE PRESIDENT: Yes, no, that must be
correct. Thank you, that must be correct, yes.

PN125

MR REITANO: Could I just - because it
becomes relevant later, could I just say in respect of 3.5, it is as narrow
as - to the extent that it may be said that it creates a binding obligation
and there is a need to demonstrate that it relevantly pertains, it is narrow
to the two concepts of, putting aside "may agree" for the moment, the
consultative process in the dispute resolution provision and I think it
clearly says so and both of those provisions we say relevantly pertain and I
will come to "consultation" next but certainly, the dispute resolution
provision is not a provision that your Honour has raised in having any
concerns about and the like.

PN126

THE VICE PRESIDENT: No, there is an
expressed statutory requirement to include it.

PN127

MR REITANO: One would be surprised if anyone
suggested that a dispute resolution procedure of the kind found in this
agreement didn't pertain.

PN128

THE VICE PRESIDENT: Yes.

PN129

MR REITANO: So that is the first point. Can
I then deal with - I don't intend to go through all of the clauses that deal
with the process of consultation. Your Honour has invited us not to do so
and to leave it to your Honour, but can I say that one of the hints that
attracts me to that course is that your Honour hasn't identified any other
clauses as not pertaining and if consultation is a subject matter within
another clause, for example, I am just picking one, deals with fixed term
employment. If there is something about consultation in that, the subject
matter of fixed term employment must necessarily be something that pertains
to the relationship. It necessarily follows
- - -

PN130

THE VICE PRESIDENT: I don't think that is
strictly correct. I have raised 6.25 and that contains
- - -

PN131

MR REITANO: I am coming to
that.

PN132

THE VICE PRESIDENT:
- - - elevation to the national level but I take your point
in relation to the others.

PN133

MR REITANO: Other than the clauses that your
Honour has nominated I don't intend to deal with any others because
consultation would necessarily pertain. Your Honour has referred to, I
think, the judgment in Ballantyne of Deputy President Ross. I am going to
give your Honour a reference to it in due course but could I just flag there
on the issue of consultation that the Federal Clerks case in the High Court
dealt squarely with the concept of consultation over a whole range of issues
being a matter that can be the subject of an industrial dispute because it
has the relevant character.

PN134

His Honour, Vice President Ross picks that
up and he picks up that whole line of authority up to that case, but I will
come back to that as I say when I deal with the other two clauses. Can I
then deal with 9.4 and 9.15 and it is interesting that I regard those as
- - -

PN135

THE VICE PRESIDENT: You don't need to say
anything further about consultation. I am happy about that.

PN136

MR REITANO: All right. Could I deal with 9.4
to 9.15. Now, there are a number of things that need to be said. I have
already dealt with and I don't want to develop anything further in respect
of clause 3.5, the question of the word "acknowledges" and your Honour will
see that throughout a great deal of the clauses that your Honour has
identified. I don't want to rest on that because I think it is very
important that your Honour understand that our position is and as I
understand it, it is a position that is well understood by the employer,
that in this industry, for this employer, given its size and its nature, one
of the big deals affecting employees that is specific and particular to it,
is job security.

PN137

Job security has been seen for very many
years as important and job security may be affected by a range of factors,
in particular, the corporate or the franchising out of post offices or the
creation of licensed post offices or the use of retail outlets that aren't
Australia Post operated. Your Honour was handed some of the material that
was tendered and in particular, one of the statutory declarations annexed a
booklet of propaganda. It is about as pejorative as I am entitled to be
today, that was published to the workforce and could I just take your Honour
just to a couple of examples because it was something that Australia Post -
and one could not suggest that in February 2004 anyone was contriving to get
over the High Court's decision in Electrolux.

PN138

But if your Honour goes to the second page
of appendix 2, your Honour will see the update dated 13 February
2004.

PN139

THE VICE PRESIDENT: Sorry, you are taking me
to which document?

PN140

MR REITANO: It is appendix 2 to I think it
was - - -

PN141

MR PASFIELD: David Barker.

PN142

MR REITANO: Mr Barker's statutory
declaration, which was exhibit 1?

PN143

MR PASFIELD: 2.

PN144

THE VICE PRESIDENT: Yes.

PN145

MR REITANO: 2, exhibit 2. Mine is in a red
folder.

PN146

THE VICE PRESIDENT: Yes. Were you being rude
to Mr Barker then, Mr Reitano?

PN147

MR REITANO: I don't think so.

PN148

THE VICE PRESIDENT: Yes?

PN149

MR REITANO: Your Honour will see that this
is one of the management updates on EBA6.

PN150

THE VICE PRESIDENT: Mr Reitano, there is a
part heard Full Bench Appeal on which I am presiding which is supposed to
commence at 10. I think the other members of the bench are happy to wait for
some time but I don't think it is appropriate to delay that substantially. I
don't want to unduly interfere with the rest of the day of the parties
either though. Is there any difficulty about coming back later in the
day?

PN151

MR REITANO: This afternoon there is. We
could probably come back at 4, we have some difficulty coming back at
2.

PN152

THE VICE PRESIDENT: Yes. Mr Tehan, do you
have difficulties with coming back at 4? It is just that I suspect that this
is going to take a little longer than what is going to be practical so far
as getting it completed before a reasonable start time for the listed part
heard appeal and the matter is too important to just cut it short, given the
badwaj consequences.

PN153

MR TEHAN: Yes, your Honour
- - -

PN154

THE VICE PRESIDENT: I take it you were
hoping to get on a plane back to Melbourne, I take it?

PN155

MR TEHAN: I would have been happy to, yes,
your Honour but I wouldn't have thought we would be all that long. Perhaps
15, 30 minutes.

PN156

THE VICE PRESIDENT: Okay, fine. Well, press
on Mr Reitano.

PN157

MR INGWERSEN: I only have some very brief
submissions to make, I think most of the matters will be covered by the
other parties but I can make some initial points in relation to this
one.

PN158

THE VICE PRESIDENT: Thank you, Mr Ingwersen.
Yes.

PN159

MR REITANO: I don't think Mr Tehan's
estimate is wrong.

PN160

THE VICE PRESIDENT: Okay.

PN161

MR REITANO: I don't want to take you through
a lot of these documents but I do want to provide this by way of example. If
one goes to 13 February document, about half-way down the page, there is a
paragraph that is in quotes:

PN162

Fundamentally, our objectives are
simple...

PN163

You will see the second dot
point:

PN164

To continue to operate the business
effectively, Australia Post must continue to improve to remain competitive
and provide job security but we will continue to implement change in a
balanced way.

PN165

One sees that sentiment repeated time after
time throughout the documents and in fact, if you turn over two pages to 18
February, there is reference there - and this is all material that is
directed attacking the union in many respects but identifies the union's
concerns and in fact the employees' concerns. In the four dot points up the
top the union does not employ our people. One might parenthetically add
"yet". We have stood out amongst all other Australian employers in providing
job security to employees over a decade. No one has been forced to leave, no
one has been forced out of a full-time job. One sees the sentiment repeated
time after time - I won't take your Honour through each of the references to
that sort of material - but job security is considered in the context of
Australia Post to be something that is under threat.

PN166

What more can affect the relations of
employers and employees in a real way than withdrawing the security of
employment that employees enjoy. Now, that is backed in, in my respectful
submission, by two authorities that I want to give your Honour at least a
reference to. The first is the High Court in the Federated Clerks' Union of
Australia v Victorian Employers Federation and Others (1984) 154 CLR 472. It
is the case that Vice President Ross referred to in respect of
considerations of consultation and the like.

PN167

Without burdening or boring your Honour with
the background to the case it involved those aspects of the termination
change and redundancy clause that introduced an obligation upon employers to
consult when introducing major changes and whether or not that could be seen
to be relevantly within the province of an industrial dispute and whether it
satisfied the test of pertaining. Your Honour would be familiar with earlier
authority in respect of managerial prerogative and managerial discretion and
the employers argued in that case, well, this is travelling into there.

PN168

The High Court at least by majority if not
unanimously - and there is debates that can be had about the Chief Justice's
judgment - but the High Court unanimously held - at least by majority held -
that the concept of managerial prerogative and the like was not something
that was necessarily any longer because of evolution of understandings of
industrial disputes and so on as something that could be sustained as an
absolute, or independent criteria found in jurisdiction.

PN169

Now, can I give your Honour the passages
without reading them, that is expressly referred to at 490, about half way
down the page, to about 492, about half way down the page in the judgment of
Mason J. Murphy J gives short shift to the notion of managerial prerogative
on page 493. Wilson J is probably a little more conservative in his approach
but still finds that managerial decisions are no longer beyond the range of
- well, observes the possibility that:

PN170

Managerial decisions are no longer
beyond the range of industrial relations.

PN171

At 499 and
- - -

PN172

THE VICE PRESIDENT: We may be at
cross-purposes here, Mr Reitano.

PN173

MR REITANO: Yes.

PN174

THE VICE PRESIDENT: I don't have any view
that the old narrow barwick view of managerial prerogative as being outside
the ambit of the Constitutional reach of the Commonwealth.

PN175

MR REITANO: Yes.

PN176

THE VICE PRESIDENT: I don't have any view
that that survived into the modern era, it has not.

PN177

MR REITANO: Yes.

PN178

THE VICE PRESIDENT: A social welfare case I
think that has hit that on the head, amongst others, but the question here
is one of characterisation, is it not? How can I characterise
- - -

PN179

MR REITANO: Closing an Australia Post, Post
Office, and opening a franchise Post Office as a matter that pertains to the
relation of employers and employees, that is what the clause deals
with.

PN180

THE VICE PRESIDENT: I was going to just pick
one of these and say, how can I say that that is properly characterised as
pertaining to job security?

PN181

MR REITANO: Yes.

PN182

THE VICE PRESIDENT: You would say, no doubt,
you have got to read them as a whole.

PN183

MR REITANO: Well, which one, your Honour,
with respect? I'm content for your Honour to pick one. The one I was
concentrating on I have to tell your Honour is 9.13, because that is the
ultimate, if you like.

PN184

THE VICE PRESIDENT: Yes.
9.14.

PN185

MR REITANO: That was the next one that I was
going to - yes. I would have thought 9.13 really takes it head on
though.

PN186

THE VICE PRESIDENT: 9.8
perhaps.

PN187

MR REITANO: Well, one can't envisage
anything more fundamental to job security than the parties working together
to make the enterprise work efficiently, something that this Commission
during the 1980s was - - -

PN188

THE VICE PRESIDENT: No, Mr Reitano, that is
not the issue. The issue is how correct - how directly connected it is to
the actual language, the matter that the actual language deals with. Don't
get me wrong, I'm with you in an ultimate sense, but I've been wanting to
play devil's advocate here.

PN189

MR REITANO: Yes.

PN190

THE VICE PRESIDENT: Look, it is an unusual
course, but is there any reason why we can't adjourn this matter now and
resume it by telephone this afternoon. Auscript can be there to record the
telephone conversation. All the documents that are necessary have been
handed up, that will meet Mr Tehan's convenience and get him back to
Melbourne and Mr Barker's as well for that matter and Ms Walsh who, no
doubt, obviously wants to get away as well and presumably this is a debate
where you can educate me which is really what I'm seeking, Mr Reitano. I
think you clearly have a view that Electrolux does not stand for the broad
proposition that some people have been contending for and I would genuinely
be assisted to hear the way your - I might say so - fine line has - confirms
that argument.

PN191

MR REITANO: My submission to your Honour on
Electrolux will be, Electrolux changed nothing about that which pertained to
the relations between employers and employees.

PN192

THE VICE PRESIDENT: I agree with that
proposition. Electrolux changed nothing about what pertains - about what is
within or without the concept of a matter pertaining to the
relationship.

PN193

MR REITANO: Yes.

PN194

THE VICE PRESIDENT: Electrolux restored the
status quo anti prior to Atlas Steels - certainly prior to Unilux and prior
to Atlas Steels in the sense that Atlas Steels drew a distinction between
the agreement context and the dispute context and that distinction appears
to have been jettisoned.

PN195

MR REITANO: Yes.

PN196

THE VICE PRESIDENT: Anything that could have
been included in an award pre the WROLA Act, properly included in an award
pre the WROLA ACT, can be the subject matter of a clause in a certified
agreement.

PN197

MR REITANO: That is where my submission
goes, ultimately, that is exactly where my submission goes, that if the
Commission wanted to make an award that said: the employees shall be bound
to assist the employer in improving the viability of the business, the
Commission could have done that, prior to the WROLA Act.

PN198

THE VICE PRESIDENT: Yes.

PN199

MR REITANO: Could have positively imposed
such an obligation on employees. As a matter of discretion it probably
wouldn't have - - -

PN200

THE VICE PRESIDENT: Yes.

PN201

MR REITANO: - - - but
nonetheless it would have been something that fell within - Mr Pasfield has
asked me if we are going to resume by phone, would it be more convenient if
we actually came here? There was one other thing that I was just going to
raise - - -

PN202

THE VICE PRESIDENT: You are nodding, Mr
Barker, is that - - -

PN203

MR TEHAN: Your Honour, we are happy to stay
and resume at 4 o'clock, if that is convenient to your
Honour.

PN204

THE VICE PRESIDENT: I'm trying to be
flexible and meet the convenience of the representatives and you in
particularly, Mr Tehan, now that you have got
- - -

PN205

MR TEHAN: No, we appreciate that too, your
Honour, but it is just as easy for us to do that.

PN206

MR REITANO: Is there any possibility - and
I'm just raising this because the matter that I have at 2 o'clock may not go
very long after 2 o'clock - is there any possibility that your Honour's Full
Bench would be finished by then?

PN207

THE VICE PRESIDENT: Yes, there is. Mr Taylor
is in his reply. No doubt Mr Buchannan will want to say a few things about
- - -

PN208

MR REITANO: Mr Buchannan does not usually
pladdle on.

PN209

THE VICE PRESIDENT: No.

PN210

MR TEHAN: That will be held against you.

PN211

THE VICE PRESIDENT: I'm going to tell on
you, Mr Reitano.

PN212

MR REITANO: I wonder then whether your
Honour would list it at - say, tell us to come back at 2.30 and we will
contact your Honour if we are in difficulty.

PN213

THE VICE PRESIDENT: I will formally adjourn
it until 4.

PN214

MR REITANO: All right.

PN215

THE VICE PRESIDENT: But my associate will
contact you as soon as it becomes apparent that we will be finishing and as
soon as we can all conveniently gather we will do so.

PN216

MR REITANO: If it please your
Honour.

PN217

THE VICE PRESIDENT: Fine, thank you, Mr
Reitano.

SHORT ADJOURNMENT
[10.19am]

RESUMED [3.45pm]

PN218

THE VICE PRESIDENT: I apologise for that
brief delay, at the time that I sent the signal for 3.30 it looked very safe
indeed that 3.30 would be okay, but sort of the appeal spiralled out of
control about 3 minutes after the signal was sent. Mr Reitano, you were in
full flight, I think, about the inconsequence of
Electrolux.

PN219

MR REITANO: Well, lest this case go anywhere
else, they were not my words, they were someone else's, but what I was
saying was that in terms of - - -

PN220

THE VICE PRESIDENT: I thought that was fair
comment.

PN221

MR REITANO: In terms of that which pertains
to the relations of employers and employees as such, Electrolux decided
nothing new. The judgment of the Chief Justice is quite clear, if we have
told you once, we have told you a thousand times, provisions to this effect
aren't provisions - or we have told you at least twice in Alcan and Portus -
don't fall into that category, but other than that there is nothing novel
about what falls within the concept of that which pertains to the relations
of employers and employees decided in Electrolux.

PN222

Perhaps one could say that the judgment of
McHugh J casts a slightly different light on things in the sense that one
needs to look to the particular employment. All that the His Honour the
Chief Justice says, which is broadly supported by the majority judgment is
that there needs to be a direct consequence between that which is provided
and the relationship and there is no direct consequence, or there is only an
indirect and consequential effect in respect of payroll deductions or
bargaining fees.

PN223

Other than that there is nothing remarkably
new and I think what your Honour then suggested to me at a point in the
argument was that, really, this takes you back to the bad old days prior to
89(a)(2) in respect of industrial disputes, and it is not a bad way of
looking at this provision, that the union makes a demand but no employees
employment shall be terminated. Now, there are a million ways in which the
Commission could have in those days come up with a provision within
jurisdiction that might have settled that dispute. One is to include a
prohibition in an award that no employee who is covered by this award shall
be terminated:

PN224

Would have had a natural or rational
tendency -

PN225

using the words of McHugh J in Vista
-

PN226

to settle the matters in
dispute.

PN227

Another way is to say that the employer and
the employees will cooperate together to ensure that the business is viable,
as for example clause 9.8 does. I think it is the clause that your Honour
pointed out to me this morning. So that the corporately operated outlets, as
distinct from other outlets that don't employ people in it with Australia
Post employees - - -

PN228

THE VICE PRESIDENT: So construing clause
9.8, what does that matter? What is the matter - what is the subject matter
of clause 9.8? What is it about, the matter that it is about I think is the
correct way of expressing it?

PN229

MR REITANO: Well, if one took 9.8 out of the
agreement in its own sterile context without anything around it, what is 9.8
about? It is about the parties to the agreement working cooperatively to
ensure that under-performing post offices perform, in substance. The subject
matter is that the viability, or the profitability of the employer's
business. Your Honour can't do it in that sterile way, in my respectful
submission, by taking each individual sub-clause at 9.4. The whole of clause
9.4 through to 9.15, which I think are all the clauses that your Honour
identified, all of those clauses - - -

PN230

THE VICE PRESIDENT: Yes, need to be read
together.

PN231

MR REITANO: All appear under the heading:
The Retail Network And Retail Outlet Review. To the extent that the heading
is relevant it tells you something about what the subject matter of the
clause is and, that is, the way in which Australia Post structures its post
offices in which its employees covered by this agreement work and how its
employees will be affected by that structure, and the simple fact that there
might be, for example, a provision like 9.13 - and it was the one that I
thought was probably "the best example", or as one might see it "the hardest
example", the simple fact that it says that there will be a maximum of 20
corporately operated outlets to be converted to franchised outlets needs to
be understood in the context of the fact that employees of Australia Post
don't work in franchised outlets.

PN232

They only work in the corporate post
offices, and imposing such a restriction ensures the security of employment
for Australia Post employees and that is what the clause
- - -

PN233

THE VICE PRESIDENT: A ban on the use of
contractors.

PN234

MR REITANO: A ban on the use,
yes.

PN235

THE VICE PRESIDENT: Enhances the security of
employment of employees, do you agree with that
proposition?

PN236

MR REITANO: Not too quickly,
no.

PN237

THE VICE PRESIDENT: Because, obviously, I'm
reading the Cox case.

PN238

MR REITANO: Yes. No ban on the use of
contractors in any part of this agreement, not this part, nor the next part
that I'm coming to.

PN239

THE VICE PRESIDENT: No, no, I'm trying to -
the mere fact that the clause has the effect of enhancing security of
employment is not sufficient, Cox case is authority for that proposition.
Otherwise, Cox would have been decided the other way.

PN240

MR REITANO: Yes.

PN241

THE VICE PRESIDENT: There is also an
un-articulated major premise in that argument that the High Court decides
cases consistently, which is a dubious premise if one looks at the
historical record.

PN242

MR REITANO: The reason why I hesitate in
answering your Honour's question is not because - well, is obviously because
if I answer in the way that your Honour expects me to, but also because it
wouldn't be correct to answer it that way - because one needs to consider
the observations in later authorities, such as Moore.

PN243

THE VICE PRESIDENT: Have you got a straight
face, Mr Reitano?

PN244

MR REITANO: I'm putting it with a very
straight face, such as Moore, because in Moore there were observations made
about the Commission's power to do something - and I won't develop it at the
moment - to do something in respect of limiting contracting because it
needed to be able to be armed with that so as to avoid the prospect that
employers could avoid the award by simply contracting, so there is a tension
between Cox and Moore in that respect, and that is why I hesitated in
answering your Honour's question.

PN245

THE VICE PRESIDENT: No, I appreciate
that.

PN246

MR REITANO: Because Moore seems to suggest,
if taken to a logical extension or conclusion, that perhaps an absolute on
contracting in some circumstances might be within jurisdiction, or might be
appropriate.

PN247

THE VICE PRESIDENT: While you are on that
point you would say more as a complete answer to 6.25.

PN248

MR REITANO: That is correct, your
Honour.

PN249

THE VICE PRESIDENT: Yes.

PN250

MR REITANO: Can I go to 6.25, because I want
to come back to 9.4, just for one other matter, but there are two matters
that are relevant to 6.25. Did your Honour also mention
6.26?

PN251

THE VICE PRESIDENT: Yes.

PN252

MR REITANO: Yes.

PN253

THE VICE PRESIDENT: Well, I think the two
are linked, aren't they?

PN254

MR REITANO: Yes, they are. 6.25, I only
observe that - sorry, it is also in the first sentence at 6.26 - that both
6.25 and the first sentence of 6.26 fall into that category that I
identified earlier about the parties acknowledging things that are - but if
one looks at 6.26, the real agreement is in - I said "first sentence" - I
should have said "first part of the first sentence" because there is no full
stop.

PN255

The real agreement is that Australia Post
agrees that arrangements will not be used unless there are sound business
reasons for doing so, so there is no prohibition. It can do so, so long as
it demonstrates sound business reasons, and secondly there is the obligation
in the last sentence that contractors will not be used of a means of
pursuing a reduction in wages and conditions of Australia Post employees. I
don't think there can be any doubt after Moore that that is a legitimate
interest of the union.

PN256

THE VICE PRESIDENT:
Absolutely.

PN257

MR REITANO: In terms of limitations of
contractors that is within jurisdiction that relevantly
pertain.

PN258

THE VICE PRESIDENT: If the clause deals with
subject matters A and B, A pertains and B doesn't, the fact that A pertains
does not save the clause if B does not pertain. You can't in a stylistic
fashion get the unpertaining matters in through - like, you couldn't say,
well - - -

PN259

MR REITANO: Yes.

PN260

THE VICE PRESIDENT: I mean, that is the
point.

PN261

MR REITANO: Well, the difficulty is what is
it that is said in clause 6.26 that does not pertain?

PN262

THE VICE PRESIDENT: I don't require any
further submissions on clause 6.25 and 6.26, I think they are caught by
Moore.

PN263

MR REITANO: Yes. Could I just commend to
your Honour - or the submissions of the National Union of Workers which are
set out in paragraph 81 of the Ballantyne decision and I adopt
those.

PN264

THE VICE PRESIDENT: Thank
you.

PN265

MR REITANO: Rather than trying to do any
better I think that they are adequately and succinctly put.

PN266

THE VICE PRESIDENT: If I can just summarise
your position in relation to 9.4 through to 9.15, you say first of all it
would be an error to consider any of these paragraphs in isolation. They
have to be read in the context of the whole of that section of the
agreement.

PN267

MR REITANO: Yes.

PN268

THE VICE PRESIDENT: Secondly, you say: read
as a whole, all of these clauses are directed towards enhancing or
preserving security of employment and that that is the matter which they are
about in the section 170LI sense.

PN269

MR REITANO: Yes.

PN270

THE VICE PRESIDENT: You say it would be
wrong to characterise any of these clauses as being about whether retail
outlets will or will not be closed.

PN271

MR REITANO: But they may deal with that but
they are not about that, yes. Can I put - my learned friend is going to say
something about this but I don't want to intrude on what he is going to say,
but can I put one matter that Mr Barker kindly pointed out to me over
the adjournment that I think I should, in justice to clauses 9.4 to 9.15,
say - that when I say it is about security of employment it is impacts on
employees in other ways in terms of the organisation of their work, the
amount of work that will be available for them, how many people will be
working in post offices and the like. So it is not just confined to - I
probably put security of employment much higher than it should be. It is not
just confined to that. It overlaps with issues of manning and the like,
issues of what work people will be doing and the like and that is
particularly, I think, apparent from - - -

PN272

THE VICE PRESIDENT: Which clause did you
say?

PN273

MR REITANO: Well, 9.10(b) for example. I
just picked that one up looking down. That is quite directed at the
performance of work.

PN274

THE VICE PRESIDENT: Yes.

PN275

MR REITANO: Can I observe - can I just point
out one other matter to your Honour, that - it arises, once again from the
observations of McHugh J that I think your Honour is aware of in the
Electrolux decision. It is interesting. I don't put a lot of store in it but
it is interesting to note that in the Australian Postal Corporation Act,
under section 90 of the Act, Australia Post is injuncted to endeavour to
achieve and maintain high standards as an employer in relation to terms and
conditions of employment. Then there is a long list of things, one of which
is included - industrial democracy. So that the participation of its
employees - - -

PN276

THE VICE PRESIDENT: What is the name of the
Acts? Is it the Australia Post Act?

PN277

MR REITANO: Yes.

PN278

THE VICE PRESIDENT: Section
90?

PN279

MR REITANO: Section 90, yes. The
participation of its employees in matters of this kind is something the Act
directs Australia Post to dealing with. It also deals with in that list of
things, things that one would expect to see - occupational, health and
safety and non-discriminatory employment practice and the like, but
industrial democracy and the participation of employees in the employer's
business seems to be something that the Post is required to set its
objectives to. I don't know that there's anything I can use from the Act for
what I've said, your Honour.

PN280

THE VICE PRESIDENT: That is relevant, that
links back to the manifestly correct McHugh emphasis on: the particular
employer and the particular employees because that is part of the context
for "this particular employer".

PN281

MR REITANO: Yes, and I've pointed earlier
on, right at the beginning of my submissions that I pointed to this
literature about the employer's concerns about the security of employment,
the propaganda and the like. One goes to the Redundancy Agreement which is
exhibit 12. There's a particular reference in that to concerns about
security of employment that relate to this particular employer. If it please
your Honour.

PN282

THE VICE PRESIDENT: Good - thank you, Mr
Reitano. Mr Ingwersen?

PN283

MR INGWERSEN: Yes, thank your Honour. I will
just make some public points in addition to Mr Reitano's submissions and
also that we endorse his submissions but with respect to clause 3.5 where
your Honour raised a number of questions in relation to that matter, I'd
point out that the clause - talks about in the second sentence:

PN284

In particular circumstances including
relation to the effects on staff in respect of major change, Australia
Post and the relevant union may agree on work place access arrangements,
involve union officials to assist with consultative processes.

PN285

That is actually a matter that has been
contemplated in awards. There's a number of awards that have been varied to
include provisions for leave for consultation and meeting provisions and
there's whole list of awards.

PN286

I don't think I need to go through them all
but I think in a case Q9399 there's a Full Bench - there was a Commission
that considered that could be incidental to the operation of dispute
resolution procedures in awards and that would be one of the circumstances
that could be contemplated by this clause where there is a matter that is
under way within Australia Post, there may be additional arrangements that
are required, such as paid time consultation meetings, and in fact I think,
in the lead-up to the disagreement being voted in there a number of such
meetings that were held. As a point that could be included in awards
- - -

PN287

THE VICE PRESIDENT: Mr Ingwersen, I don't
think there's any difficulty with - upon mature reflection I think the point
that Mr Reitano made that the "in particular circumstances sentence" does
not in fact impose any true new legal obligation and therefore it is within
the trivial category of Gleeson CJ. The only issue is the last sentence and
to be perfectly frank, I haven't had an opportunity because of the Full
Bench hearing today to look at the Work Place Representation Guidelines
which have been handed up, have they not? If any issue arises as a result of
the contents of those guidelines, I will contact the parties and give them
opportunity to make a further submission.

PN288

MR INGWERSEN: I won't provide any further
comments on clause 3.5 then your Honour to save some time. I was going to
make some brief comments in respect to clauses 9.4 through to 9.15, just to
add a little to what was put by Mr Reitano. The important thing is that
these clauses do need to be considered as a whole. What they are doing is
going through a process for considering the status of the Post Office and
that had substantial impact on both the employees within those Post Offices
and other employees because what it basically comes down to is, if a Post
Office is to be closed, then those employees would either be given a
redundancy or move on to a re-deployment register and they would then be
seeking jobs elsewhere within Post.

PN289

What one of the things that the clauses does
is it effectively outlines some of the criteria where those employees could
then come to a stage where their Post Office is going to be closed and they
could be facing the potential redundancy situation. So respectively, a
number of commitments from Post to their employees, commitments from the
people on the other side as well that - to try and make the Post Offices
work as effectively as possible, but those commitments there are clearly
designed to outline in what circumstances there may be - we can call it a
closure, but it may be a move to a franchise.

PN290

But effectively it would mean that those
people working in that Post office would seek to be employees of Australia
Post if they were made redundant, or they would have to be re-deployed
elsewhere and that criteria is important and is spelt out in detail in line
13.

PN291

The clause as a whole deals with the steps
that would be gone through in terms of considering those matters and as such
certainly that clearly was in the relationship between the employer and the
employee. I won't add anything further in relation to that. I think it was
covered by Mr Reitano and I expect that Post will have some comments to add
with respect to that as well, your Honour.

PN292

THE VICE PRESIDENT: Thank
you.

PN293

MR TEHAN: Yes, your Honour. Your Honour,
firstly may I thank you for the effort you are clearly putting into seeing
that the Agreement complies with the law and observing your own oath also -
appreciated by the parties and should be noted. The second thing your Honour
is that the submission that Mr Reitano made to you about the proper
construction of this document and this Agreement as an industrial instrument
is that it needs to be really context and as a whole and is
adopted.

PN294

Your Honour, there is authority for it. It
is trite law of course that documents need to be viewed in their entire
context including legislation but in particular in relation to awards. I
thought I should draw your attention to French J, in City of Warnaroo and
Homes (1989) 30, Industrial Report 362 at page 378 who approved a very old
decision of Street J, in George A Bond and Co Limited and MacKenzie (1929)
Arbitration Reports NSW, 498 at 503.

PN295

Street J said that it is necessary to
consider every part of an award and endeavour to give it a meaning
consistent with the general intention of the parties to be gathered from the
whole award. I think it is relevant that one can go through in a sentence by
sentence sort of way of an agreement like this but not understand that it
comes against the background that I started off in my submissions this
morning making to you. Your Honour, I think French Js comments or similar
comments have been adopted in Branson Js decision in the National Tertiary
Education Union v University of Wollongong. I don't remember the citation
but that was considering the interpretation of a certified agreement. Your
Honour, do I take it that you are satisfied in relation to clauses 3.1 and
3.3?

PN296

THE VICE PRESIDENT: Yes. I think it is 9.4
through to 9.15 is the only - - -

PN297

MR TEHAN: Thing that is
remaining.

PN298

THE VICE PRESIDENT: - - - one
that I still have a question mark in my head about and I am
- - -

PN299

MR TEHAN: Thank you, your
Honour.

PN300

THE VICE PRESIDENT:
- - - inclined to accept that it does pertain and I think
that the fact of section 90 provides some degree of further comfort in
relation to that but I have to say I haven't come to a final view about
it.

PN301

MR TEHAN: Your Honour, may I just say
something about the right of entry provision that was talked about a moment
ago? With respect, you are correct when you say in particular circumstances
and does not you know, impose any new obligations on Australia Post. The use
of the word "may" there is very much a discretionary "may". It is not a
"may" which means must in the context, it is a facilitative provision which
comes against a bit of a background again and your Honour would be familiar
with this because of your panel responsibilities. Australia Post observes
and requires observance with the right of entry provisions in the Act and as
part of that they have sought to have an agreed protocol with the union
which Commissioner Blair presided over and sorted out and that is observed
by Australia Post.

PN302

But there will be circumstances where the
requirements of the Act, for example, the requirement that you meet outside
- within meal breaks, section 285(c)(ii) or the less than 24-hour notice
provision, 285(3)(ii) might not be appropriate in all the circumstances and
Australia Post simply records in particular circumstances it may seek to
facilitate entry. So I thought that was worth noting to your Honour. Again,
the contextual background is important. Your Honour, if I may turn to the
clauses 9.4 to 9.15 and commence by saying this. If ever there were clauses
in an enterprise agreement that focus on the enterprise, these are
them.

PN303

This is an enterprise agreement and these
clauses focus on one quarter of the staff of Australia Post. Approximately
9000 employees are employed in the retail network of Australia Post and
these clauses clearly are focused on that part of the enterprise. Secondly,
your Honour, it is totally natural that employees would focus in this sort
of a way bearing in mind the observations of the High Court in re Crann ex
parte NSW Colliery Proprietors Association (1987) 163 CLR 117 at 135, where
unanimously, the Court said:

PN304

No doubt our traditional system of
industrial conciliation and arbitration has itself contributed to a
growing recognition that management and labour have a mutual interest in
many aspects of the operation of business enterprise. Many management
decisions once viewed as the sole prerogative of management are now
correctly seen as directly affecting the relationship of the employer and
employee and constituting an industrial matter.

PN305

THE VICE PRESIDENT: Thank you, Mr Tehan,
that is very useful.

PN306

MR TEHAN: So your Honour, it is against that
sort of a dicta that it is important to recognise that Australia Post has
4500 retail outlets as at 30 June, of which 862 only are corporate outlets.
The rest are licensed post offices or community mail centres - agents. 4493
and 862 corporate-owned and that 862 is a drop in 17 years from 1,400
approximately. It has significantly fallen in 17 years since 1987 and
Australia Post employees are naturally concerned about their job security
and Australia Post conducts its conversations with them against the
background where there has been a significant drop in the number of
corporate-owned retail outlets.

PN307

Franchising is one of the new modes of
delivery of Australia Post's retail network. There are only four at present.
It is not a major part of Australia Post's mode of delivery of these
services but there have been disputes in the Commission, this Commission,
over them when they commenced some years ago. I appeared but I can't
remember when it was, it might have been 3 or 4 or 5 years ago and it was
done very late but there were threats of actual industrial dislocation at
the time. So franchising has been an item on the union's agenda and
employee's agenda for some years. It is pertinent to note, your Honour, that
in that circumstance the comments of McHugh J need to be noted where he said
at paragraph 79 of his judgment in Electrolux, 209 ALR 116 at page 137,
paragraph 79, your Honour in the media neutral way of
writing:

PN308

The relationship between an individual
employer and the persons employed in a single business those matters may
not pertain to the relationship between employers and employees generally
in their capacity as such - - -

PN309

THE VICE PRESIDENT: Mr Reitano has referred
to that passage, I am familiar with it and it is clearly
relevant.

PN310

MR TEHAN: It is worth noting that passage,
your Honour, that Australia Post's circumstances might be quite different to
some other employer that has that circumstance.

PN311

THE VICE PRESIDENT: Yes.

PN312

MR TEHAN: So your Honour, I have really
dealt with these clauses - I have really dealt with the background to it.
Job security, the career service that is still a part of Australia Post's
approach. It is not as big an area now as it once was but when you bear in
mind that Australia Post spun out of the Post Master General's Department in
1975, with all of its career service implications, it is natural enough that
people are concerned about it and it is about franchising. As you see when
you get to the last few clauses of the clauses that we are considering. You
can't read the document really, your Honour, without understanding that the
conversion reference in 9.4, which would otherwise be a rather odd thing,
conversion of corporate retail outlets, is meant to be a reference to
conversion as it is set out in 9.13, to franchise outlets.

PN313

Of course, with a franchise outlet, as Mr
Reitano said, those employees who were employed there will no longer be
employed by Australia Post. It bears directly on their employment. Unless
you have other questions, your Honour, I think that would be
helpful.

PN314

THE VICE PRESIDENT: No, Mr Tehan, thank you
very much. You have made a number of points of some assistance and I think
that passage in Crann was particularly useful. Anything further anyone wants
to say?

PN315

MR REITANO: Your Honour just raised and I
should have just given your Honour a reference. Your Honour raised at the
outset of Mr Tehan's submissions, the lack of opportunity your Honour had to
look at the part of exhibit 13 that represents the guidelines. I should have
given your Honour the reference but I am sure your Honour is aware of from
Vice President Ross' decision in any event, but in Archer's case which is
(1919) 27 CLR 207, and it is the whole discussion at 216-221, it is said
that the provision of facilities for union officials by the employer is a
matter that relevantly pertains. That is relevant because when you go to
that part of exhibit 13 that I have identified, as it goes off ad nauseam
about provision of facilities and provision of access to things and so on
and the like.

PN316

The other matter that I should point out
that your Honour might think, well, maybe that is not - when your Honour
comes to look at the document, maybe that is not a matter that pertains, is
the question of the union notice board, a provision which I am intimately
familiar with. The union notice board must pertain because it is actually
the right to have the union notice board as found in an award of the
Commission and general conditions of employment or whatever, clause 10
- - -

PN317

THE VICE PRESIDENT: Clause 10 of the General
Conditions of Employment?

PN318

MR REITANO: Yes. Part of the reason I point
some of these things out is because of some of the post-Electrolux hysteria
that stood for anything that mentioned a union in an agreement was
bad.

PN319

THE VICE PRESIDENT: I'm not part of that
particular hysteria, at least not at the moment. However, the mere fact that
something has made it into an award is not conclusive.

PN320

MR REITANO: I suppose that is
right.

PN321

THE VICE PRESIDENT: The award may have been
made by Member X, substitute the name for the opposite of Vice President
Ross, if you can understand what I'm saying?

PN322

MR REITANO: Yes, I do understand that. The
only reason I hesitate and say: I suppose that is right is because I'm just
trying to think back to the simplification case and what it said, and that
was constituted by - - -

PN323

THE VICE PRESIDENT: It is prima facie
evidence. Well, evidence is the wrong way of putting it. Prima facie, that
is a strong indication that the matter pertains but it does not absolve a
Member in my position from applying the first principles.

PN324

MR REITANO: Absolutely, your Honour, yes.
Sorry, what I was referring to was the simplification case where the
principles for simplification were laid down. I think, and I don't say this
with any great confidence, but it was in a grab bag of provisions that were
said to be allowable because they were incidental to the operation of the
award, I think. As I say, I hesitate to put it any more confidently than
that.

PN325

THE VICE PRESIDENT: No. Well, incidental is
the obvious way of seeing it.

PN326

MR REITANO: Yes.

PN327

THE VICE PRESIDENT: The problem - we don't
need to go there at the moment. If I have a difficulty with that, I will
relist this matter for hearing by telephone in the first instance to save
the time and expense of bringing the representatives down to the hearing
room. Thank you very much for your assistance, Mr Tehan, Mr Reitano, and Mr
Ingwersen. I will adjourn this matter and consider my certification
decision. You can expect that you will have it very promptly because I
appreciate that there's a need to get this finalised in the interests of the
35,000 employees whom it will impact upon. The Commission is
adjourned.

ADJOURNED INDEFINITELY
[4.20pm]

INDEX

LIST OF WITNESSES, EXHIBITS AND
MFIs

EXHIBIT #1 COPY OF ORIGINAL
AGREEMENT
PN20
EXHIBIT #2 ORIGINAL
STATUTORY DECLARATION OF DAVID BARKER
PN21
EXHIBIT #3 STATUTORY
DECLARATION OF MR PAUL INGWERSEN
PN23
EXHIBIT #4 STATUTORY
DECLARATION OF GEOFF FARY
PN29
EXHIBIT #5 STATUTORY
DECLARATION OF JULIUS ROE
PN30
EXHIBIT #6 AUSTRALIA
POST PRINCIPLE DETERMINATION PN35

EXHIBIT #7 STATUTORY DECLARATION OF MR
BAULK
PN38
EXHIBIT #8 CODE OF
ETHICS OF AUSTRALIA POST
PN42
EXHIBIT #9 COMPETENCY
FRAMEWORK ASSESSMENT POLICY
PN44
EXHIBIT #10 AUSTRALIA
POST OCCUPATIONAL HEALTH AND SAFETY POLICY AGREEMENT
PN45
EXHIBIT #11 AUSTRALIA
POST HR MANUAL, RATES OF PAY
PN46
EXHIBIT #12 COPY OF THE
AUSTRALIA POST REDUNDANCY, REDEPLOYMENT, AND RETRAINING AGREEMENT
(1995)
PN47
EXHIBIT #13 BUNDLE OF
CORRESPONDENCE
PN52