Industrial Relations Commission of New South Wales CITATION: Australian Workers Union v. Industrial Galvanizers Corporation Pty Limited [2009] NSWIRComm 1004 APPLICANT Australian Workers Union PARTIES: RESPONDENT Industrial Galvanizers Corporation Pty Limited FILE NUMBER(S): IRC 2258 of 2008 CORAM: Connor C CATCHWORDS: industrial dispute - claim for underpayment of wages - absorption of superannuation into wages - jurisdiction challenged - Federal instrument - claim considered to be beyond jurisdiction Annual Holidays Act 1944 Industrial Relations Act 1996 LEGISLATION CITED: Long Service Leave Act 1955 Long Service Leave (Metalliferous Mining Industry Act 1963 Federal Workplace Relations (Work Choices) Act 2005 CASES CITED: Liquor, Hospitality and Miscellaneous Union v. Kekatos [2008] NSWIRComm 1077 State of New South Wales v. Commonwealth of Australia (2006) 156 IR 1 HEARING DATES: 09/02/2009 EXTEMPORE JUDGMENT DATE : 9 February 2009 APPLICANT Dave Hancock Australian Workers Union LEGAL REPRESENTATIVES: RESPONDENT Jeromy Hanrahan Minter Ellison Lawyers DECISION: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: CONNOR C Monday, 9 February, 2009 Matter No IRC 2258 of 2008 Australian Workers Union and Industrial Galvanizers Corporation Pty Limited Notification of an industrial dispute by the Australian Workers Union under S.130 of the Industrial Relations Act, 1996 re superannuation payments DECISION [2009] NSWIRComm 1004 1 Pursuant to the provisions of S.130 of the 1996 Industrial Relations Act, the Australian Workers' Union lodged a notification of an industrial dispute with Industrial Galvanizers Corporation Pty Limited, alleging underpayment of wages and their absorption in superannuation entitlements. The matter has been the subject of several proceedings before me in the Commission's premises at 90 Crown Street, Wollongong - Friday, 12 December, 2008, Monday, 22 December, 2008 and Monday, 9 February, 2009. In the proceedings Mr Hancock represented the AWU and Mr Hanrahan represented Industrial Galvanizers. 2 Mr Hancock's claim on behalf of the AWU is directed at enforcement of what he sees as an existing entitlement for employees of Industrial Galvanizers. It is mounted principally as a small claim under Ss.379 and 380 of the State IR Act. In particular, S.380(1) provides as follows: " An industrial organisation may, during any proceedings before the Commission, make an application for an order under this Part and for the application to be dealt with under S.379 (small claims procedure)." The maximum amount of any order for a small claim is confined by S.379(3); it presently stands at $20,000.00 for each individual employee. 3 However, Mr Hanrahan has challenged the jurisdiction of the State Commission to determine this matter, essentially on the basis that Industrial Galvanizers is a trading corporation for the purposes of S.51(xx) of the Commonwealth Constitution. By virtue of the 2005 Federal Workplace Relations (Work Choices) Act, there are currently certain restrictions imposed on the State Commission in dealing with industrial disputes involving S.51(xx) corporations [State of New South Wales v. Commonwealth of Australia (2006) 156 IR 1]. 4 The AWU members are covered by a Federal collective agreement - the Industrial Galvanizers Port Kembla Collective Agreement. Moreover, for S.51(xx) corporations, even State instruments are converted into Federal instruments by Work Choices - State awards become "notional agreements preserving State awards" [NAPSA's] and State enterprise agreements become "preserved State agreements" [PSA's] under Work Choices. They therefore, in fact, cease to be State instruments, as far as S.51(xx) corporations are concerned, and become Federal instruments instead. And, as Mr Hanrahan has submitted, that clearly has an impact on proceedings mounted as small claims under Ss.379 and 380 of the State IR Act which I will discuss in more detail later in this decision. 5 As I indicated in my unreported decision of Tuesday, 23 September, 2008 in Liquor, Hospitality and Miscellaneous Union v. Kekatos [Matter No.IRC 924 of 2008 at p.4], in exercising the small claims jurisdiction provided by Ss.379 and 380, and thereby providing orders to enforce an existing entitlement for an employee, the complexion of S.130 changes somewhat. S.364(1)(b) provides that a member of the State Commission hearing a small claim under Ss.379 and 380 becomes an "industrial court" as defined to include: "…in the case of proceedings under S.380 (small claims during other Commission proceedings) - the Commission whether or not in Court Session…" And pursuant to S.365: "An industrial court may, on application, order an employer to pay any amount payable under an industrial instrument that remains unpaid to the person to whom it is payable." 6 But an "industrial instrument" is defined in S.8 as meaning: "...an award, enterprise agreement, a public sector industrial agreement, a former industrial agreement, a contract determination or a contract agreement..." Meaning essentially a State instrument. The jurisdiction of the State Commission under Ss.379 and 380 is confined to State instruments (or by virtue of S.364(2) entitlements flowing from permits under S.125 of the State IR Act (impaired workers), under the 1944 Annual Leave Act, the 1955 Long Service Leave Act or the 1963 Long Service Leave (Metalliferous Mining Industry Act). In particular, enforcement of provisions of the Federal Industrial Galvanizers collective agreement is beyond jurisdiction, as Mr Hanrahan has submitted. To that extent, comments I made as obiter dicta in Liquor, Hospitality and Miscellaneous Union v. Kekatos (at p.4) must be read down. 7 Work Choices does reserve to State local courts and magistrates jurisdiction to hear and determine claims for underpayment of entitlements under Federal instruments. An "eligible court" for that purpose is defined by S.717 to include local courts and magistrate's courts but an "industrial court" under the State IR Act is not the same thing as an "eligible court" under Work Choices. State magistrates exercise the power of recovery of unpaid wages by virtue of the Work Choices legislation itself which recognises them but not "industrial courts" as defined in the State IR Act. 8 In that light, Mr Hancock has indicated that the AWU will be pursuing its claim before a magistrate and he has withdrawn the S.130 matter before me. I propose to grant it leave to discontinue the proceedings in terms of Rule 138. P J CONNOR Commissioner 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.