Industrial Relations Commission of New South Wales CITATION: Notification under s. 130 by the AFMEPKIU NSW Branch of a dispute with EnergyAustralia re alleged non payment of skills retention allowance [2008] NSWIRComm 114 NOTIFIER PARTIES: Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union, New South Wales Branch RESPONDENT EnergyAustralia FILE NUMBER(S): IRC 2127 of 2007 CORAM: Harrison DP CATCHWORDS: Notification of industrial dispute - Section 146A Agreement - Section 379 Small Claim application - agreement re contracting of work - inclusion of an additional party to agreement refused - industrial rights of applicants not affected by contracting out agreement - Memorandum of Understanding (MoU) on contracting of capital works - mutual obligations in MoU - question of skills retention allowance in industrial agreement. Held - no offer made - application refused. LEGISLATION CITED: Industrial Relations Act 1996 CASES CITED: Emwest Products Pty Ltd (t/as Email Metering) v Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union [2002] FCA 61 National Fleet Network Pty Ltd v Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union [2005] FCA 917 HEARING DATES: 6 May 2008 DATE OF JUDGMENT: 1 July 2008 NOTIFIER Mr A Walkaden LEGAL REPRESENTATIVES: RESPONDENT Mr S Meehan of Counsel Solicitor Ms K Halpin Minter Ellison JUDGMENT: - 8 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: HARRISON DP Tuesday, 1 July 2008 Matter No IRC 2127 of 2007 Notification under section 130 by the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union, New South Wales Branch of a dispute with EnergyAustralia re alleged non payment of skills retention allowance DECISION [2008] NSWIRComm 114 1 This matter was initiated by the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union, New South Wales Branch ("the Union") by notification of a dispute with EnergyAustralia pursuant to s130 of the Industrial Relations Act 1996 ("the Act"). 2 EnergyAustralia has entered into a referral agreement ("the referral agreement") with the Union and other registered industrial organisations pursuant to s 146A of the Act. The referral agreement (NREF 29 of 2007), filed with the Industrial Registrar, commits the parties to the provisions of the Act and the powers of the Commission conferred thereby. 3 The EnergyAustralia Agreement 2006 ("the Industrial Agreement") is a collateral common law agreement enforceable pursuant to the Act. 4 The specific terms of the referral agreement can be found at cl 4 of the Industrial Agreement in the following terms: 4. REFERRAL AGREEMENT 4.1 Recitals 4.1.1. The parties to this Agreement have agreed to confer upon the Industrial Relations Commission of New South Wales ("the Commission") powers under s146A of the Industrial Relations Act 1996 (NSW) ("The Act") to resolve an industrial dispute ("a Dispute"). 4.1.2. This Referral Agreement refers all industrial matters (within the ordinary meaning of the expression) between the parties to the Commission arising in relation to the EnergyAustralia Agreement 2006. 4.1.3. The parties agree that the referral of a Dispute to the Commission under this Referral Agreement also complies with the model dispute resolution process in Part 13 of the Workplace Relations Act 1996 ("the WR Act"), to the extent that the WR Act can or does apply to that Dispute. 4.1.4. The parties agree that the referral of a Dispute to the Commission under this Referral Agreement relates only to the industrial matters arising in relation to the Agreement, and will not apply to any other matters in dispute between the parties now or in the future. 4.1.5. The parties agree to be bound by the terms of this Referral Agreement. 4.2. Terms of the Referral Agreement 4.2.1. The parties confer on the Commission all of the functions and powers prescribed by the Act, as amended, including all related procedural powers in accordance with the Regulations, Rules and Practice Directions of the Commission. 4.2.2. In referring a Dispute to the Commission, the parties agree the Commission may exercise all of the functions and powers prescribed by the Act, as amended, including all related procedural powers Regulations, Rules and Practice Directions of the Commission. 4.2.3. Subject to the rights of appeal of any party, any determination, award, order or direction made by the Commission, in relation to the Agreement, is binding on the parties. The parties will implement forthwith or within such other time as may be specified by the Commission, any determination, award, order, finding, direction or other decision made by the Commission. 4.2.4. A party may decide to appeal a determination, award, order or direction made by the Commission pursuant to this Referral Agreement. Any such appeal must proceed in a manner as provided by Chapter 4 Part 7 of the Act, and must be determined in a manner as provided in s.192 of the Act. 4.2.5. The making of this Referral Agreement does not prejudice the ability of the parties to agree to refer any future dispute to the Commission under another Referral Agreement. 4.2.6. This Referral Agreement may not be modified or varied unless by further written agreement signed by the parties. 4.2.7. This Referral Agreement shall remain in force until 18 December 2008, or until terminated by written agreement, signed by the parties. The Referral Agreement may continue to operate beyond the nominal expiry date until rescinded and replaced by the parties. 4.2.8. The parties also agree that this Referral Agreement complies with the model dispute resolution process in Part 13 of the Workplace Relations Act 1996 (as amended) ("the WR Act"), to the extent that the WR Act can or does apply to that Dispute, [employer] and/or [union]. 5 Clause 5 of the Industrial Agreement details the disputes procedure leading to notification to this Commission in the following terms (cl 5.3.7): 5.3.7 If the dispute remains unresolved, a party to the dispute can seek to have the matter resolved by the New South Wales Industrial Relations Commission in accordance with the referral agreement (at Clause 4) under s146A of the Industrial Relations Act 1996. 6 In accordance with the Act conciliation proceedings took place which established that the matter could not be resolved by agreement. A Certificate of Attempted Conciliation was issued, together with directions to prepare the matter for hearing on 6 May 2008. 7 The Union prosecuted the matter as a small claim arising in other proceedings pursuant to s 380 of the Act, which states: 380 Small claims during other Commission hearings (1) 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 section 379 (Small claims procedure). (2) Such an application may be made only if the order is sought against another party to the proceedings. (3) The Commission must not deal with the matter until the party against whom the order is sought is given adequate prior notice of the application and an opportunity to be heard on the application. (4) The Commission may deal with the matter even though it is not constituted as the Commission in Court Session. (5) The Commission may, instead of dealing with the matter, remit it to an industrial court constituted by an Industrial Magistrate for determination. (6) An order made in accordance with this section is to be made separately from any other order in the proceedings. (7) This section is not to be construed as excluding an application for an order being made in respect of a former employee. 8 It is useful to restate here the applicable aspects of s 379: 379 Small claims procedure (1) A person who makes an application to an industrial court for an order under this Part may request that the application be dealt with under this section. (2) An application that the industrial court decides to deal with under this section is called a small claims application . (3) The maximum amount that the industrial court may order an employer to pay on a small claims application in respect of any one employee is: (a) except as provided by paragraph (b)—$10,000, or (b) if some other amount is prescribed by the regulations for the purposes of this section—that other amount. (4) The industrial court is not bound by the rules of evidence when dealing with a small claims application, but may inform itself of any matter in such manner as the court thinks fit. 9 On 28 March 2008 the Union filed the particulars of the small claim as required by the Commission's Rules using Form 5, Particulars of Small Claim Under Section 379 Made During Other Proceedings (Ex 1). 10 The requirement of notice prescribed by s 380(3) of the Act is thereby met. 11 The Union seeks an order, particularised in exhibit 1, that EnergyAustralia pay 26 persons, identified in Schedule A to exhibit 1, an amount of $5,000 in the form of a one-off $500 payment from the date of decision; and a further nine payments of $500 every six months thereafter. 12 The grounds and reasons are set out in Schedule C to exhibit 1 in the following terms: SCHEDULE C 1 . All employees listed in Schedule 'A' are employed by EnergyAustralia and are classified under the terms of the EnergyAustralia Agreement 2006 as trades and technical staff. 2. A skills retention allowance is currently being paid to some trades and technical staff employed by EnergyAustralia. The total amount of the skills retention allowance currently being paid is $5000. 3. The total amount claimed of $5000 reflects the total amount of the skills retention allowance that is currently being paid to some trades and technical staff. 13 The payments sought are taken from an agreement between EnergyAustralia and The Electrical Trades Union of Australia, NSW Branch (ETU) providing for a skills retention allowance detailed in a memorandum of understanding ("the MoU") on the delivery of EnergyAustralia Network Capital Expenditure. 14 The MoU (Ex 7) states: MEMORANDUM OF UNDERSTANDING 15 August 2007 MEMORANDUM OF UNDERSTANDING ON THE DELIVERY OF ENERGYAUSTRALIA NETWORK CAPITAL EXPENDITURE This document is a Memorandum of Understanding which reflects and records a binding agreement between the parties to this Memorandum. 1. PARTIES This Memorandum of Understanding, is binding upon: 1.2 the Electrical Trades Union of Australia, New South Wales Branch ("ETU"); and 1.3 EnergyAustralia ("EnergyAustralia"). 2. RECITALS 2.1 EnergyAustralia's primary responsibility is to maintain, improve and extend the supply network­ across its franchise area. 2.2 To ensure the best possible outcomes for EnergyAustralia's stakeholders, including the public, investment in the network will be at record levels from 2006-2011 and possibly thereafter. 2.3 The Network Capital Works expenditure for 2006/07 is forecast to be approximately, $650 million, for 2007/08 approximately $750 million, and more than $900 million in future years, subject to regulatory allowance. 2.4 Network projected works include a return to significant levels of reconductoring, 11kV covered conductor ("CCT") construction and low voltage aerial bundled cable ("ABC") construction. 2.5 "Defined works" as referred to in this Memorandum of Understanding, are overflow works beyond the capacity of EnergyAustralia's permanent workforce to deliver within the timeframe of the Capital Works plan, examples of which are set out in Schedule 1. 2.6 EnergyAustralia and the ETU acknowledge that this Memorandum operates to exclude the effect of Clause 7 of the EnergyAustralia Agreement 2006 or any subsequent common law agreement or industrial instrument entered into by the parties. AGREEMENT The parties agree that the use of external resources to meet capacity requirements, as outlined in this Memorandum of Understanding, will be carried out in good faith and without industrial action or other workplace objection. 15 The MoU then details the obligations and commitment of the parties to it. 16 Undertakings by EnergyAustralia are detailed in cl 4, which include the sign-on and progress payments specified in cl 4.3 in the following terms: 4.3 Sign-On and Progress Payments 4.3.1 EnergyAustralia will make a one-off sign-on payment and additional discretionary progress payments, at six-monthly intervals during the life of this Memorandum of Understanding, to employees primarily affected by the operation of the defined works, as indicated in 4.3.2 and 4.3.3 below. 4.3.2 The one-off sign-on payment will be paid on execution of this Memorandum of Understanding, and made up of a total of: 4.3.2.1 $500 for electrically trade-qualified employees; and 4.3.2.2 $300 for non-electrically qualified electricity supply operatives. 4.3.3 A maximum of nine progress payments will be made up of a total of: 4.3.3.1 $500 every six months for electrically trade-qualified employees; and 4.3.3.2 $300 every six months for non-electrically qualified electricity supply operatives. 4.3.4 Each progress payment will be paid every six-months on the basis of the establishment and continuation of this Memorandum of Understanding 4.3.5 Progress payments are one-off at risk payments, subject to taxation prior to payment, do not count for any other purposes, and cease with the termination of this Memorandum in accordance with clause 7. 17 The undertakings by the ETU are detailed in cl 5, which includes at cl 5.3 reference to cl 7 of the Industrial Agreement in the following terms: 5.3 No penalty for breach of clause 7 of the EnergyAustralia Agreement 2006 will be sought by the ETU or its members for the use of external resources for Defined Works. 18 Consultation and dispute resolution procedures are specified in cl 6 of the MoU; cl 7 deals with Operation and Term of the MoU; cl 8 deals with Force Majeure; and defined works are found in Schedule 1 to the MoU. 19 The Union is not a party to the MoU, which is directed at the contracting of specific capital works. 20 The Industrial Agreement provides for outsourcing/contracting out in cl 7 in the following terms: 7. OUTSOURCING/ CONTRACTING OUT 7.1 In circumstances where EnergyAustralia is examining outsourcing or contracting out of work activities: 7.1.1 it will advise the employees and their Union/s and provide them with at least 28 days notice to respond with suitable proposals about possible alternative arrangements to outsourcing or contracting out. 7.1.2 prior to expressions of interest or tenders being called, where employee generated alternatives are received, such alternatives will be considered 7.1.3 if it is subsequently determined that expressions of interest or tenders are to be invited, EnergyAustralia will provide the Union/s with a copy of the document which has been prepared. 7.1.4 expressions of interest or tenders when advertised, shall be timed so as to provide the employees with an opportunity to submit a conforming expression of interest or tender to do the work to an equivalent standard, timetable and price. 7.1.5 if an employee generated conforming expression of interest or tender is submitted, it shall be evaluated together with external submissions received. 7.2 Work will only be outsourced or contracted out when it can be demonstrated that either: 7.2.1 insufficient overall resources are available to meet the current EnergyAustralia overall work commitment and work timetable, or 7.2.2 the failure to complete the work in a reasonable time would jeopardise the safety of the public or impact adversely upon system performance, or 7.2.3 the use of outsourcing or contracting out the work is commercially the most advantageous option taking into account quality, safety, performance, cost and the overall strategic direction of EnergyAustralia. 7.3 When a decision is made by EnergyAustralia to outsource/ contract out work not already outsourced or contracted out, preference will be given to those contractors who have a registered agreement with the relevant union. In a review of existing contracts, EnergyAustralia will only award a contract to a contractor that demonstrates it has established appropriate industrial relations policies and practices and that it complies with industry safety standards, environmental standards and quality standards. 7.4 In the evaluation of conforming expressions of interest or tenders, any comparisons will be made on a basis discounting any overheads that would continue even if the work was outsourced or contracted out. Such overheads would typically include tendering costs, contract administration, contract supervision and the cost of any redundancies which may arise as a result of the decision to outsource or contract out. 7.5 In the event that it is determined to outsource or contract out work, affected employees will have access to the full range of options available under the EnergyAustralia policies which apply at the time, including training and/or retraining . 21 The gravamen of the argument advanced by the Union is that when members of the Union voted to accept the terms of the Industrial Agreement they did so expecting to be paid the skills retention allowance. 22 Mr Walkaden relied upon the evidence of Mr John Worrell, a member of the Union employed by EnergyAustralia at the Homebush Depot. Mr Worrell was employed as a vehicle body builder at the relevant time and is now employed as a technical instructor. 23 Mr Walkaden also brought evidence from Mr Sean Morgan, the Acting Secretary of the NSW Vehicle Division of the Union. Mr Morgan is the Union Official responsible for services to members employed by EnergyAustralia. 24 Mr Morgan's evidence is that he did not attend all negotiations with EnergyAustralia, on occasion deferring to officials of the ETU, which he described as having predominant membership. 25 The evidence of Mr Worrell and Mr Morgan is: · They both attended a mass meeting of EnergyAustralia employees at Canterbury Racecourse on or around 4 December 2006. · The meeting was endorsed by EnergyAustralia for the purpose of consideration and vote on the proposed Industrial Agreement. · On entry to the venue union officials distributed an outline of the salient terms of the proposed agreement (Ex 5) in the following terms: Log Item Impact for Employees Increase to Wages per annum 3%pa 1% Increase to Superannuation per annum 1%pa Increase to Full Safety Rules + Skills Allowance $30 per week (YR 1 to June 07) $60 per week (YR 2) Increase in Paid Maternity Leave Increase to 14 weeks Introduction of Paid Parental Leave Introduced at 1 Week Increase of Night Shift Allowance to $40 per occasion $40 per occasion Cessation of Skill Structure Reviews With Work Value Increases Award to be amended to ensure work value increases continue on an individual (promotional) basis Reduction of Sick Leave Occasions Without Certificate Reduce from three days to two (Occasions increased to 7) Contractors to undertake Close Approach Tree Trimming · Introduce Drug & Alcohol Testing Changes to Safety Rules Allowance Requirements (see attached) · Tightening of Responsibilities · Sign-on to HAC Separation of Grievance and Dispute Resolution Procedures In accordance with March Agreement, separate procedures In accordance with March Agreement: Changes to Consultation Clause · JOCC merged to relevant DCC · PCC external chair, new charter and meet as required MoU/Skills Retention Allowance Up Front payment $500 / $300 $1000 / $600 pa paid 6 monthly (At Risk) (2% of average ordinary time earnings for full allowance) Subject to taxation Schedule of Works Attached All figures for first year EnergyAustralia Wages Negotiations - Proposed Offers Off-sets · Cessation of Skill Structure Reviews with Work Value Increases · Reduction of Sick Leave Occasions from Three Days to Two Days · Separation of Grievance and Dispute Resolution Procedures Trades & Technical · Changes to Consultation Clause · Safety Initiatives: Drug & Alcohol Testing, amendments to the Safety Rules and HAC Sign-Off · Tree Trimming Close Approach Consistent with the current Integral and Country Energy approach · They both presumed that the skills retention allowance would apply to all trades and non-trades staff and did not question its application. · Mr Morgan deposed that some members expressed the view that the wage increase of 3% was inadequate. He advised them to accept the Industrial Agreement, having regard to the whole of the package including the increase in superannuation and skills retention allowance. 26 The Canterbury meeting was one of a number of such meetings held in various locations over a two week period. 27 A message to all staff from EnergyAustralia management on 18 December 2006 (Ex 6) advised that: "the ETU, USU, CFMEU, AMWU and AWU representing more than 3,100 staff endorsed the offer following the mass meetings" 28 The parties then applied themselves to the necessary administrative requirements, resulting in formal approval of the Industrial Agreement before the Commission as presently constituted on 28 March 2007 [2007] NSWIRComm 74. 29 The MoU was not executed with the ETU until 15 August 2007. 30 Mr Worrell deposed that the skills retention allowance was explained to the meeting by Mr Riordan, State Secretary of the ETU, who described the allowance as a payment to let contractors do overflow work and that the allowance would be paid to tradespeople, apprentices and electricity supply operators. Mr Worrell's evidence is that the exact amount of the allowance was conveyed by Mr Riordan but that he could not recall the amount stated. 31 This evidence is supported by that of Mr Morgan who deposed that Mr Riordan informed the meeting that the 3% wage increase was supported by a 1% increase in superannuation contribution, an increase in the Electricity Safety Rules Allowance, and the skills retention allowance, through a memorandum of understanding which would allow EnergyAustralia to bring in contractors to deal with a backlog of capital works without the threat of industrial action. 32 Mr Morgan's evidence is that the meeting was informed that: "the skills retention allowance not only provides for a cash payment, but gives security of employment for the life of the agreement" 33 Mr Morgan deposed that he addressed a group of the Union's delegates and members, saying words to the effect (Ex 8, para 13): This is not a bad proposal. The pay rises are not great and we have given up one of the reporting days for sick leave. However, we have a 1% increase in super and the skills retention allowance. The skills retention allowance gives us the security employment in case of privatisation. I recommend you vote for it. 34 The evidence of Mr Morgan is that he then referred the extra matter to the Union's research department which attended to the detail of the industrial instrument which gave expression to the agreement reached. In cross examination Mr Morgan deposed that he did not take any issue with the fact that there is no reference to the MoU or skills retention allowance in the formal agreement submitted to the Commission for appeal. 35 The evidence of Mr Worrell is that in either August or September 2007 he became aware that the MoU had been concluded and was surprised that he and his workshop colleagues were not included. Mr Worrell deposed that he raised the matter with his immediate supervisor and the senior delegate of the Union at the depot. Mr Worrell's evidence is that his supervisor was unaware of the MoU and that the delegate believed that he was entitled to payment. 36 The evidence of Mr Morgan is that the Union's senior delegate at the Homebush Depot referred the issue to him. Mr Morgan took the matter up with EnergyAustralia by meeting and correspondence which failed to resolve the matter, leading to these proceedings. 37 EnergyAustralia brought evidence from Mr Richard Brown, Executive Manager, Business Services within the Enerserve division of EnergyAustralia. 38 Mr Brown described Enerserve as the engineering and construction division of EnergyAustralia's business, providing design, construction and maintenance to the electricity distribution networks. 39 Mr Brown has been employed by EnergyAustralia and its predecessors for 31 years, the past 10 years in his current role. Mr Brown described his primary responsibilities as industrial relations, workforce planning and development, financial management, and safety services, reporting to the General Manager of Enerserve. 40 Mr Brown's evidence was the he was not directly involved with negotiation of the MoU, however, was required to provide technical input by describing the type of works which were to be outsourced in Schedule 1 of the MoU. 41 Mr Brown differentiated between the type of work subject to the MoU, which he described as unique because of its size and because it involves the contracting out of EnergyAustralia's core function, namely work on the electrical network; compared to that which is outsourced in accordance with the provisions of cl 7 of the Industrial Agreement. 42 The evidence of Mr Brown emphasised that the MoU payments are confined to those employees "primarily affected by the defined capital works program". 43 Mr Brown deposed that each of the individual projects identified in Schedule 1 to the MoU involve contractors performing electrical and ancillary work, which is precisely the work currently performed by EnergyAustralia employees. Inconsistent Application 44 The Union submitted that the skills retention allowance provided by the MoU has not been applied in a consistent manner. 45 In pursuit of this argument the Union acknowledged that clauses 4.3.2 and 4.3.3 of the MoU limit payment to electrically trade qualified employees and non-electrically qualified electricity supply operators, however, payment has been made to some boilermakers and fitters who do not fall within these categories. The Union asserts that this inconsistency is undesirable and the allowance should be paid to all trades and technical staff. 46 EnergyAustralia acknowledges that the MoU payments have been made to some employees who are not electrically qualified on the basis that it had been demonstrated that the specific employees concerned were primarily affected by the work to be contracted out in as much as it is work they would do and continue to do. 47 The evidence of Mr Worrell established that the employees on whose behalf the claim is made are employed as motor mechanics or motor body builders at the Homebush and Wallsend Depots. EnergyAustralia submits that none of this work is subject to the MoU. No Extra Claims Provision 48 EnergyAustralia submits that the Union is restrained by the No Extra Claims provision of the Industrial Agreement at cl 46, which states It is a term of this Agreement that the union parties to this Agreement undertake that for the period of the duration of this Agreement that they will not pursue any extra claims, Agreement or over Agreement, except where consistent with the State Wage Case principles. 49 EnergyAustralia submits that the Industrial Agreement provides for a skills retention allowance in Schedule 3, applicable to engineers. At cl 3.2.8 of Schedule 3 a skills retention allowance of $20 per week is applicable from 19 December 2006, increasing to $40 per week from 1 July 2007. 50 The Industrial Agreement does not provide a skills retention allowance for any other classification, consequently this matter is an extra claim prohibited by cl 46. 51 The Union contends that a No Extra Claims clause does not automatically result in an agreement being comprehensive and covering the field so as to preclude any other agreement between the parties (see Emwest Products Pty Ltd (t/as Email Metering) v Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union [2002] FCA 61). 52 The Union submits that whether the No Extra Claims provision is totally exclusionary is a matter of interpretation and degree. The Union submits that EnergyAustralia conducted negotiations with the ETU resulting in the MoU as a matter separate and distinct from the Industrial Agreement containing the No Extra Claims provision; and accordingly the No Extra Claims provision does not restrict it from advancing that subject matter. 53 The Union submits that the No Extra Claims provision of the Industrial Agreement is limited to restricting claims regarding the subject matters that have been explicitly dealt with by the Industrial Agreement. The Union submits that this is evident when compared with the No Extra Claims provision of the National Fleet Network (Portland) Enterprise Agreement 2003, which Merkel J held, in the matter of National Fleet Network Pty Ltd v Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union [2005] FCA 917, was so limited. 54 The National Fleet Agreement precluded claims that went to: "changes in conditions of employment or any other matters related to the employment of employees, whether dealt with in this agreement or not" 55 The issue of contracting out of work was a matter dealt with by the parties in the negotiations leading to the Industrial Agreement, the result expressed in cl 7 thereof. In so far as the claim in this matter relates to contracting out of work, it is not a new clause and may be properly characterised as a claim concerning application of the Industrial Agreement. JURISDICTION 56 EnergyAustralia submits that the terms of the referral agreement limit the jurisdiction of the Commission to: "industrial matters arising in relation to the agreement and will not apply to any other matters in dispute between the parties now or in the future" 57 EnergyAustralia submits that the issues raised by the Union in these proceedings are not industrial matters arising in relation to the industrial agreement. 58 The Union refutes the view of "in relation to" advanced by EnergyAustralia, submitting such application of the referral agreement too narrow. The Union referred to the Collins Dictionary definition of "relation" which includes "connection (between things)"; and the meaning of "related" defined as "connected; associated" to support a wider application of that term to include the MoU. 59 The Union submits that there is sufficient connection between the present dispute and the industrial agreement to bring the matter within the Commission's jurisdiction. The Union submits that this position is reinforced by the conduct of EnergyAustralia, which did not raise any jurisdictional issues in the exchanges with Mr Morgan over a number of months, or in the preparatory stages of this matter. 60 The Union also relied on correspondence from EnergyAustralia to Mr Morgan of 21 November 2007 (Ex 11) which states that: "EnergyAustralia will respond to any application to the NSWIRC when the matter is before the Commission" MERIT 61 EnergyAustralia submitted that the MoU is an agreement between EnergyAustralia and the ETU which contains mutual obligations and specifically defines the classification of employees who are eligible to receive the payments. EnergyAustralia submits that the Union's application does not in any way refer to or address the rationale for the payments pursuant to the MoU. 62 EnergyAustralia further submits that the orders sought do not countenance the "at risk" nature of the payments prescribed by the MoU. 63 EnergyAustralia refutes the assertion that the Union's members were misled by exhibit 5 and the explanation of the industrial agreement provided to employees at mass meetings. EnergyAustralia submits that exhibit 5 provides no justifiable basis for an assumption that the Union or its members would be party to the MoU which is reinforced by the incontrovertible fact that the MoU was not concluded at the time of the mass meetings and was negotiated separately with the ETU in respect to specific classifications and designated capital works some months later. 64 EnergyAustralia further submits that the Union did not raise the issues now agitated at or before the proceedings for approval of the Agreement by the Commission on 28 March 2007. The Union was represented in those proceedings which progressed on the basis of consent by all parties. 65 The Union refutes the merit argument advanced by EnergyAustralia, submitting that the payments have been made by EnergyAustralia in accordance with the MoU to some members of the Union, which destroyed the restricted classification and scope argument advanced. 66 The Union further submits that no party raised any issue to do with the MoU in the proceedings before the Commission on 28 March 2007 as the MoU had no bearing on any determination to be made. The Union submits that whether any reference was made to the MoU at those proceedings is irrelevant to the present matter. Industrial Equity 67 EnergyAustralia submits that the Union has failed to produce any evidence of anomaly, inequity, or unfairness in the application of the MoU payment. EnergyAustralia submits that not all staff receive the MoU payments, which it emphasises are "at risk payments". 68 EnergyAustralia submits that, as a matter of industrial equity and fairness, the MoU payment should not be paid to employees in respect of whom there is no evidence they are affected by the works contemplated under the MoU. 69 The Union refutes this argument by reference to general wage movement of 4%, described as the Average Annualised Wage Increase for all consent wage agreements in December 2006 quarter and December 2007 quarter, as reported by the Australian Department of Workplace Relations; and an underlying rate of inflation of 4.2% for the year ending March 2008 (ABS 6401.0 CPI Australia March 2008); and specific wage increase of 4.3% for the electricity gas and water supply industries for the December 2006 quarter and 4.3% for the December 2007 quarter. 70 The Union submitted that the value of the Agreement without the MoU payment falls below wage increases in comparative industries and enterprises in an uncertain economic climate and rising costs of living, which it put is unfair. CONSIDERATION 71 I find no impediment to the application arising from jurisdiction as argued, or fundamental restraint by the No Extra Claims provision. 72 The claim concerns a matter which was subject to active consideration at the time the industrial agreement was made. 73 The issue is an industrial matter as defined by the Act and is properly processed in accordance with the disputes procedure. 74 The agreement between the parties pursuant to s 146A adopts the Act and accordingly the jurisdiction of the Commission is described by the Act, not the agreement of the parties. 75 In consideration of a small claim the Commission may have regard to a number of issues, including whether payment for work done is just and equitable. Section 367 of the Act states: S 367 Order for recovery of payments not fixed by industrial instruments (1) An industrial court may, on application, order an employer to pay an amount to an employee as remuneration for work done by the employee if: (a) the rate or amount of that remuneration is not fixed by an industrial instrument, and (b) an industrial instrument fixes the rate or amount of that remuneration when done by some other person, being an industrial instrument that is applicable to other work done by the employee or to the same work done by that employee in different circumstances (in either case being work done under the contract of employment with the same employer). (2) The industrial court is not to make an order under this section unless it is satisfied that in the circumstances of the case it is just and equitable for the employer to remunerate the employee for the work concerned. (3) For the purposes of an order under this section, the industrial court is to determine an appropriate rate or amount of remuneration for the work done. Any such determination applies only for the purposes of the application for the order and does not affect any relevant industrial instrument. Merit 76 In this matter the Union seeks enforcement of an agreement to which it is not party. The Commission cannot, by Order or Direction, inject a party into an agreement made by others. 77 The true nature of the MoU between EnergyAustralia and the ETU is a method of application of cl 7 of the Industrial Agreement to a large body of contractual work. 78 The evidence is that EnergyAustralia have applied the terms of the MoU to all employees who are materially affected by that work. 79 For all of the others, and for work not falling within the scope of Network Capital Expenditure, the terms and provisions of cl 7 of the Industrial Agreement continue to apply. 80 Three is no evidence that any work of motor mechanics or body builders at the Homebush or Wallsend Depots is, or is likely to be, contracted out. In the event contractors are required in those areas the provisions of cl 7 apply. 81 It follows that the members on whose behalf this claim is made have lost none of their rights in respect to contracted out work. It is not valid or fair that they should receive a payment which is in effect a consideration for giving up particular rights. 82 The argument advanced that the Skills Retention Allowance was offered to those employees at the Canterbury meeting is not sustained on the evidence, any resolution is their own. 83 The argument advanced by the Union on the grounds of industrial equity is not made out. The increase of three per cent on wages plus one per cent in superannuation is effectively a four per cent increase, which is consistent with the general wage movement relied upon by the Union. The value of the agreement to employees not part of the MoU is further enhanced by increases in allowances and the general level of wage to which the increase and superannuation component are applied. 84 There is no basis for the making of an award or order sought by the Union. 85 The application is refused. 86 Matter No IRC 2127 of 2007 is so concluded. oo0oo 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.