Industrial Relations Commission of New South Wales CITATION : Australian Services Union of New South Wales -v- Sydney Water Corporation [2004] NSWIRComm 294 PARTIES : Australian Services Union, New South Wales Branch Sydney Water Corporation FILE NUMBER: 2196 of 2004 CORAM: Grayson DP CATCHWORDS : Industrial dispute - Restructuring of employer business - Creation of new positions - Significant similarity to previous positions - Changes of emphasis and methodology rather than substance - Employer's right to test labour market to be balanced against employees' rights to be treated with fairness and justice - Discretion to directly appoint rather than conduct competitive selection process - Issue not as to existence of discretion to directly appoint but rather the manner of its exercise - Nature of releif sought - Scope of operation of power to make orders under s 136 and s 137 of Industrial Relations Act 1996 - Held, on the evidence, positions significantly similar to previous positions - Conditions precedent to exercise of disccretion to make direct appointments established - Union application granted - Direct appointments ordered LEGISLATION CITED : Industrial Relations Act 1996 Wilson v Department of Education and Training (2000) 100 IR 1 CASES CITED : Nowra Coaches Case (IRC 6159 of 2002, 25 July 2001 unreported) Australian Liquor Hospitality and Miscellaneous Workers Union, Liquor and Hospitality Division, New South Wales Branch v Parramatta Leagues Club Ltd [2002] NSWIRComm 28 HEARING DATES: 07/09/2004; 09/13/2004; 09/27/2004; 09/28/2004 DATE OF JUDGMENT: 10/22/2004 Ms A Milson Australian Services Union, New South Wales Branch LEGAL REPRESENTATIVES: Mr D Fitzgerald Sydney Water Corporation JUDGMENT: - 11 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: Grayson DP 22 October 2004 Matter No IRC 2196 of 2004 THE AUSTRALIAN SERVICES UNION OF NEW SOUTH WALES -V- SYDNEY WATER CORPORATION Notification under section 130 by Australian Services Union of N.S.W. of a dispute with Sydney Water Corporation re organisational change DECISION OF THE COMMISSION [2004] NSWIRComm 294 1 In this matter, the Australian Services Union for whom Ms A Milson appeared seeks orders in the following terms: - 1. That Jason Cognetta and Fred Schulz be appointed to the position of Resource Coordinator at IPS 59. 2. In the event that the Commission finds against the applicant in relation to the issue of appointment to the position of Resource Coordinator the ASU seeks shift wind down conditions to apply as follows: 100% shift loading for weeks one to twenty, 75% for weeks one to forty, 50% for weeks forty one to sixty and 25% for weeks sixty one to eighty. 2 The orders are sought against a background of organisational change within the employer's Civil Maintenance business which was foreshadowed in correspondence from Sydney Water to the ASU dated 12 August 2002. 3 Since that time, the employer and the union have been in ongoing dispute about the organisational change and of particular relevance to these proceedings, about whether there should be direct appointments to the newly created positions of Resource Coordinator. 4 A discretion to make or approve direct appointments to positions within Sydney Water - that is, appointments without first conducting a competitive merit selection process, resides in the General Manager and the circumstances in which the General Manager might exercise that discretion are set out in the Sydney Water Human Resources Manual which relevantly states: - 3. Direct permanent appointment In principle, positions should generally be filled through the competitive selection process. However, in certain circumstances where an employee meets the skills, attributes and knowledge required for the position and the Manager can satisfy the General Manager that direct appointment would on balance be appropriate and fair, then direct appointment may be approved by the General Manager. An employee cannot however, be directly appointed to a position that is more than two evaluated IPS levels above their current substantive IPS level (eg a person substantively at IPS 47 may be direct (sic) appointed to a position up to IPS 53 but no higher). Some examples where on balance appointment may be considered fair are: · Where redeployed employees are suitable on the basis of their skills and performance. See part 2: Redeployment and Redundancy: Point 4 ii-v. · Where the position to which appointment is made is essentially the position the employee has held and is not significantly different to the substantive position of the employee. · Where it is considered that an employee recommended for direct appointment would win this position if advertised, by virtue of unique experience and performance in this or a similar. and later: - 13. Filling multiple positions in an environment of downsizing or restructuring The following process is appropriate where there is a need to fill multiple positions within a group whilst downsizing or restructuring overall. (a) Direct appointment may occur under Point 3, i.e. where the new roles are essentially the positions the employees have held and are not significantly different but may have been redesigned. (b) Where the new roles are substantially different to the previous positions, then applications may be sought from within the group with a selection panel convened in the normal manner. 5 Both Mr Cognetta and Mr Schulz presently occupy positions known as Production Employee Support Officer (PESO) and have done so for roughly six and a half years. 6 Throughout that period, both Mr Cognetta and Mr Schulz carried out what is known as scheduling work on virtually a full time basis and in that time, were favourably reviewed by management for their work performance. 7 As schedulers, the duties of both men on their unchallenged evidence, included but was not limited to: - · assigning jobs to reactive work crews in the Civil Maintenance business · organising plant and equipment if required by the crews · negotiating with customers to meet priorities · liaising with the Mechanical/Electrical staff about asset failures · negotiating with plumbers regarding choke claims · monitoring incoming jobs from the Service Centre on the Works and Asset Management (WAMS) System · monitoring crew logging and whereabouts via the Mobile Data Transfer monitors · handling incidents in accordance with the Incident Management Procedures, including acting as Incident Controller which involves the notification of stakeholders via the paging systems and keeping an up to date log of events · monitoring crews' fatigue · monitoring lone worker policy for the first call response production employee · calling out and organising standby crews and extra resources if required · organising the leak detector to assist work crews if required · monitor emails and other correspondence on daily issues · advise depots of work crews stood down because of working during the night who will be available for normal duties at the start of the day 8 By contrast, the newly created positions of Resource Coordinator have as their stated purpose to: Manage the resource allocation of reactive works in the Civil Maintenance Business to ensure that resources are allocated appropriately and used effectively and efficiently. In particular, the Resource Coordinator is expected to: Provide a quality customer service via: 1. Meeting standards of service for response times 2. Achieving best practice standards in resource allocation: · Downtime/fatigue costs minimised · Allocation of duplicate jobs minimised · Effective forecasting of unit resource requirements · Jobs allocation rates increased 3. Optimal utilisation of resources: · Jobs competed within business improvement targets (work crew efficiency) · Jobs completed by first team on site (resource allocation efficiency) · Overtime/call out costs minimised 4. It is also expected that the occupant of this role will undertake: · Other projects as required · Additional duties during periods of absence of other staff 9 Further, the key performance areas specified for Resource Coordinators are described in the evidence as follows: · Receive jobs and ensure they are recorded and tracked effectively and accurately · Interpret job details and clarify or query information where necessary. either directly with the customer, call centre or with the SOC, to ensure that jobs are scoped as accurately as possible · Renegotiate job priorities directly with customers where necessary, based on the Resource Coordinator's interpretation of information from resources and customers, to ensure that deadlines are appropriate, customer expectations are managed/met and customer satisfaction levels are maintained · Identify the best work teams for individual jobs, based on job priority, location and type and resource availability, skill set and cost (including fatigue or "stand down", call out and overtime costs) so that jobs are resourced appropriately and cost are minimised · Schedule and allocate jobs to work teams to manage work flow and ensure that work teams have clear instructions on job requirements · Monitor job status and manage job progress to ensure that Sydney Water meets its deadlines and obligations, costs are minimised and relevant stakeholders are informed of any problems with completing the job on time · Proactively identify area resource requirements on a daily basis and communicate directly with resource providers to ensure that adequate resources are made available to the area · Analyse data and prepare compliance reports for the management team, to ensure that the Civil Maintenance Business, Sydney Water complies with necessary legislation, regulations and procedural requirements and compliance levels are monitored · Analyse data and prepare performance reports for the management team to ensure that performance levels are recorded and monitored effectively · Act as Incident Controller when necessary and take control of all incident communications until an incident controller is installed to ensure that all internal and external stakeholders receive vital information as quickly as possible 10 Mr J Gillet, the Operations Manager of the Civil Maintenance business was called on behalf of Sydney Water and was cross examined at some length on his affidavit evidence and it seems to me in the interests of coming quickly to the point, that whilst he was initially at pains to highlight what he regarded as distinctions and differences between the scheduling work previously done by the Production Employee Support Officer (PESO) and the work of the newly created Resource Coordinator, the import of his evidence after cross examination was that, when viewed in its entirety, there are significant similarities in the work previously required of the scheduler and the work presently required of the Resource Coordinator. 11 The same significant similarities were effectively conceded by Mr Gillet in the expressed purpose of the scheduling work and the work of the Resource Coordinator and I am of the view that such differences as there may be between the two are more differences in emphasis and methodology than differences in substance requiring significantly different skill sets. Clearly on the evidence, the work required of the schedulers over the years developed and changed in terms of technology, for example. These were changes to which Mr Cognetta and Mr Schulz adapted with appropriate training and instruction and there was nothing in the evidence as I view it, that was suggestive of an inability on their part to adapt to any evolutionary refinement in the work required of the Resource Coordinator. 12 Indeed as following extract of Mr Gillet's cross examination evidence reveals, the contrary is indicated: HIS HONOUR: Q. What was the date the resource coordinator position was created? A. 1 July. Q. 2004? A. That's right. Q. May I take it that since the position has been created a number of other functions have been added to the duties and responsibilities of the position or are in the process of being added? A. In the process of being added. Q. So the position in terms of the range of functions and responsibility, duties, obligations are dynamic? A. Absolutely. MILSON: Q. In terms of F, G and H, these are all the kinds of things that can happen in the position in the scheduling function as it evolves over time? A. Yes, and the expectations would be that the resources coordinator would evolve. Q. So that in terms of all of these changes it is fair to say that since the scheduling job started in 1997, and in particular since 1998, when Cognetta and Schulz weren't under the threat of rotation back to the field, that the job has always been dynamic but it has consistently changed to meet the business requirements of the day? A. Yes. Q. So that there is nothing new in the concept of the resources coordinators meeting changes and dealing with changes and the way things are done, protocols and procedures, new technology, new plants? A. No there is nothing new in the expectation, in the change, that is fair to say. 13 In such circumstances, that is taking into account the words as they appear in the Human Resources Manual: ... where the new roles are essentially the positions the employees have held and are not significantly different but may have been redesigned ... there is a clear mandate for the exercise of discretion to make direct appointments. 14 Whether the General Manager has the right to decline to exercise his discretion as was contended by Mr Fitzgerald is not in issue here and nor is the integrity of the selection process which was conducted by Sydney Water to fill the Resource Coordinator positions although the evidence relied upon by Sydney Water was directed in part at establishing both of these matters. 15 In fact one of the ASU witnesses Mr Humfrey who had previously carried out scheduling work as a PESO, was selected for appointment as a Resource Coordinator and as such, was well placed to comment in his evidence about the essential and significant similarities between the scheduling role he had previously carried out and his present role as a Resource Coordinator. Mr Humfrey strongly argued that he and Mr Schulz and Mr Cognetta should have been offered direct appointment to the new positions. 16 With every respect to the position taken by Sydney Water regarding the desirability of an employer being able to test the labour market in order to attract the best candidates for the vacant positions, it seems to me that such notions need to be balanced against the rights of employees such as Mr Schulz and Mr Cognetta to be treated in a manner which is fair and just. It is noted in that regard, that since missing out on appointment to Resource Coordinator positions, Mr Schulz and Mr Cognetta have been assigned to day work positions and have suffered substantial reduction in their earnings. 17 Turning then to the nature of relief sought by the ASU, it is contended by Mr Fitzgerald for Sydney Water that the first order sought does not fall within the kind the Commission is empowered to make under section 137 of the Industrial Relations Act 1996 (the Act). Mr Fitzgerald as I understand him did not take issue with the Commission's power under section 136 to make an award in arbitration proceedings but rather suggested that many of the decisions of the Commission purporting to make orders are in fact the Commission exercising its power under section 136 (1) (b) to make awards. 18 That submission, however, overlooks the definition of award contained in the Dictionary at the end of the Act which is as follows: award means an award made, or taken to be made, by the Commission under this Act, and includes any order of the Commission under this Act that sets conditions of employment. 19 The Dictionary at the end of the Act then defines conditions of employment as including any provisions about an industrial matter and section 6 of the Act thereafter provides by way of a general definition and a series of examples, a wide-ranging scope for the operation of the Act with respect to industrial matters. 20 I do not consider and to be fair to Mr Fitzgerald it is not strongly pressed, that the Commission is limited in its arbitral function in such a way as to preclude the granting of relief in the nature of the relief sought by the ASU in the first order for which it here applies. Conversely, I am of the view that the Commission would if so satisfied on the evidence, be within the scope of section 136 (1) (b) of the Act in making an order of the type sought by the ASU. 21 I note there is support for that view in the unreported decision of Sams DP in IRC No. 810 of 2002 Australian Liquor Hospitality and Miscellaneous Workers Union, Liquor and Hospitality Division, New South Wales Branch v Parramatta Leagues Club Ltd [2002] NSWIRComm 28 upon which the ASU relies. In that case, Sams DP although declining on the merits to grant the relief sought by the notifying union, rejected the employer's submission to the effect that the Commission lacked power in the arbitration of a dispute, to make an order under section 136 of the Act of the type sought by the union in that case. His Honour held that section 136 provided sufficient scope to make orders of the type sought by the union fixing the hours of work of a casual employee quite independently of and distinctly to the kinds of dispute orders envisaged by the limiting provisions of section 137 of the Act. 22 As an extension of that approach, it was found by Connor C in the Nowra Coaches Case (IRC 6159 of 2002, 25 July 2001 unreported) that a decision of the Commission taking the form of a direction under section 136 of the Act made in the course of arbitration, is a final determination of the issue/s in dispute and subject to any subsequent decision on appeal, is binding on the parties to the dispute. 23 In this matter, Mr Fitzgerald in reliance upon the appeal decision of the Full Bench in Wilson v Department of Education and Training (2000) 100 IR 1, also argued with persuasive force that the alternative order sought by the ASU was in the nature of an order for payment of compensation, lost remuneration or another amount and is therefore not open to the Commission because of the limiting provisions of section 137 (3) of the Act. 24 Ms Milson conceded there may be such a limitation on the Commission's power and that if the Commission were so minded, the ASU would accept a recommendation that the parties should confer further with the Commission's assistance, as to the shift wind-down benefits claimed in the alternative order. Ms Milson, however, pressed for the primary relief sought and maintained that it was within power to grant. 25 For its part and in relation to the shift wind-down claim, Sydney Water indicated that it would submit to a recommendation by the Commission affording the two employees in question some form of shift wind-down conditions provided they were at a lower level as to duration than that claimed by the ASU. 26 In the result, the question of shift wind-down conditions is not necessary to determine because as indicated earlier in these reasons, I am comfortably satisfied on the evidence, that the new Resource Coordinator role within the Civil Maintenance business is essentially the scheduling role previously carried out by Mr Schulz and Mr Cognetta and with every respect to the earnest contention of Mr Fitzgerald for Sydney Water, it is not the existence of the General Manager's discretion to make direct appointments which is in question here. It is the manner of the exercise of that discretion on this occasion. 27 Having said that, the Commission's decision in this case is not to be taken as a decision of general application in the operation of the subject discretion and the prerequisite notions of appropriateness and fairness contemplated by clause 3 of the Sydney Water Human Resources Manual as well as those other conditions precedent to the exercise of discretion will have to be made out in each case before the Commission will intervene. 28 In determining the issue/s in dispute between the parties, the Commission grants the ASU application and in so doing, makes the following order under section 136 (1) (b) of the Act: That Jason Cognetta and Fred Schulz be appointed to the position of Resource Coordinator at IPS 59 . 29 These proceedings are accordingly concluded. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.