Industrial Relations Commission of New South Wales CITATION: BlueScope Steel (AIS) Pty Limited and Australian Workers' Union, New South Wales [2008] NSWIRComm 1015 APPLICANT BlueScope Steel (AIS) Pty Limited PARTIES: RESPONDENT Australian Workers' Union, New South Wales FILE NUMBER(S): 2035 of 2007 CORAM: Macdonald C CATCHWORDS: Dispute - Referral Agreement - dispute concerns disagreement over company's proposal to rationalise the Mechanical Trades Assistants structure in the Painting & Finishing Department at the Springhill site, Port Kembla - that disagreement had reached the stage where a "status quo" provision contained in the relevant award had been invoked by the Union - the effect of the "status quo" provision is that the company is unable to introduce its intended work change - during the "status quo" stage the parties are to confer (with or without the assistance of the Commission) over the intended work change - the "status quo" provision can be revoked by agreement of the parties, by expiry of a time limit for the "status quo" or by industrial action - the dispute notification by the company alleged that the "status quo" provision had been revoked by industrial action - Union disagreed - compulsory conference failed to resolve dispute notification - arbitration - evidence of witnesses as to conversations leading up to and including day of industrial action considered - legal issues considered - onus on the Company to prove industrial action by production employees was industrial action over the Company's proposed change on different class of employees (maintenance employees) - Held, the Company had not proved its case - "status quo" provision not revoked by industrial action of production employees. LEGISLATION CITED: Industrial Relations Act 1996 HEARING DATES: 20/12/07 DATE OF JUDGMENT: 10 April 2008 APPLICANT BlueScope Steel (AIS) Pty Limited Mr T Sebbens (Sol.) LEGAL REPRESENTATIVES: RESPONDENT Mr B Gorgievski Australian Workers Union, NSW DECISION: - 13 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: MACDONALD C 10 April 2008 Matter No IRC 2035 of 2007 BlueScope Steel (AIS) Pty Limited and Australian Workers Union, New South Wales Notification under section 146A by BlueScope Steel (AIS) Pty Limited of a dispute with Australian Workers Union, New South Wales re Company's proposal to rationalise the Mechanical Trades Assistants structure in the Painting & Finishing Department. DECISION [2008] NSWIRComm 1015 1 The Commission has before it, a dispute notification pursuant to s146A (Referral Agreement) of the Industrial Relations Act 1996 ("the Act"). The dispute notification was lodged by BlueScope Steel (AIS) Pty Limited ("the Company") against the Australian Workers Union, New South Wales ("the Union"). 2 The dispute notification was lodged on 7 November 2007. 3 The dispute notification arises out of a previous, related dispute notification concerning the Company's proposal to rationalise the Mechanical Trades Assistants structure in the Painting & Finishing Department at the Springhill site, Port Kembla. 4 A Compulsory Conference of the parties was held on 15 November 2007. 5 The dispute remained unresolved and was set down for a Hearing on 20 December 2007. 6 Mr T Sebbens, solicitor appeared for the Company. He was assisted by Mr M Davis, Senior HR Advisor. Mr Sebbens called the following witnesses: · Mr Peter Sellers - Shift Team Leader (Relief) · Mr Gary Meta - Operations Manager 7 Mr B Gorgievski, union official, appeared for the Union and called the following witness: · Mr Bradley O'Hare - Coat Room Operator BACKGROUND 8 The Company advised the Union of its intention to rationalise the Mechanical Trades Assistants Structure in the Painting and Finishing Department. Discussions took place between the parties as to this Company proposal. The Company took the view that discussions were at an end and signalled its intention to proceed with its work change proposal. 9 The Union invoked an award condition, called the "status quo", which prevents the Company from implementing the proposed work change for the time being. 10 This "status quo" award condition, however, will lapse if employees take industrial action over a Company proposed change. 11 The Company claimed that there had been such industrial action and therefore the "status quo" provision had lapsed by that industrial action. If that be the case, then the Company would be able to implement its intended work change proposal. The Union rejected the Company's claim that there had been industrial action over the intended work change proposal. FINAL SUBMISSIONS For the Company 12 Mr Sebbens, Solicitor, for BlueScope Steel (AIS) Pty Limited tendered a document being an Outline of Submissions (Ex 16) and he also gave oral submissions in support of Ex 16. This submission, shortly put, went to the Company's case that certain industrial action undertaken by certain members of the Union, had brought to an end, the operation of an award provision known as the "status quo" provision. 13 The award in question is the BlueScope Steel Ltd - Springhill and CRM Employees Award 2006 ("the Award"). 14 The sub-clause in question is 36.4.3(n): "The status quo will lapse in the event of industrial action over the proposed change." 15 The "proposed change" is the proposal of the Company to remove Trade Assistants from shiftwork. 16 The submission identified two key issues for consideration by the Commission in respect of the status quo provision found in sub-clause 36.4.3(n): (a) Whether industrial action took place on 13 November 2007 by employees affected by the proposed change?; and (b) Whether the employees took the industrial action "over" the proposed change? The submission put that if the answer to both questions is in the affirmative, then the "status quo" invoked by the Union under sub-clause 36.4.3(n) will lapse, and the Company may implement its proposed change. 17 The submission dealt with a few terms appearing in the relevant sub-clause: "industrial action"; "over" and "proposed change". 18 The submission set out the evidence in support of the Company's case that certain "industrial action" taken on 13 November 2007 was "over" the "proposed change" sought by the Company. 19 The Company sought a finding, therefore, from the Commission that the "status quo" provision had lapsed by that "industrial action". For the Union 20 Mr Gorgievski, for the Union, tendered a Union Submission (Ex 21) and he also gave oral submissions in support of Ex 21. 21 The Union submission contended that there had been no breach of sub-clause 36.4.3(n) of the Award. 22 The Union submission advised that there are two work changes taking place, at the same time, at the Springhill Works site. The first change is a "proposed change" by the Company to reduce the number of Rovers at the Paintline. This "proposed change" said the Union submission, is only a change affecting production employees. The second change is a "proposed change" now before the Commission. This "proposed change" affects different employees, that is, maintenance employees. 23 The Union submission, therefore, was that there had been no breach of the "status quo" provision pertaining to the "proposed change" for maintenance employees, because the "industrial action" taken by 13 November 2007, was action by production employees. 24 Accordingly, the Union asked that the Company's application be dismissed. Company in Reply 25 Mr Sebbens advised, inter alia, that the Commission still had the power to deal with the matter between the parties by say, further conciliation, in the event that the Commission should dismiss the Company's present action that the status quo has lapsed. CONSIDERATION The Company's case was that certain industrial action undertaken by certain members of the Union, had brought to an end, the operation of an award provision known as the "status quo" provision. 26 The sub-clause in question is 36.4.3(n): "The status quo will lapse in the event of industrial action over the proposed change." 27 The "proposed change" is the proposal of the Company to remove Trade Assistants from shiftwork. 28 The submission identified two key issues for consideration by the Commission in respect of the status quo provision found in sub-clause 36.4.3(n): (a) Whether industrial action took place on 13 November 2007 by employees affected by the proposed change?; and (b) Whether the employees took the industrial action "over" the proposed change? The submission put that if the answer to both questions is in the affirmative, then the "status quo" invoked by the Union under sub-clause 36.4.3(n) will lapse, and the Company may implement its proposed change. 29 The onus is on the Company to prove its case. Re: Industrial Action 30 Mr Sebbens referred the Commission to the Dictionary of the Act for the definition of "industrial action", in order to establish that that element of sub-clause 36.4.3(n) had been made out by the Company. 31 The Dictionary defines "industrial action" as follows: " industrial action means a strike by employees or a lock-out by an employer, and includes: (a) a practice relating to the performance of work, adopted in connection with an industrial dispute, that restricts, limits or delays the performance of work, or (b) a ban, limitation or restriction affecting the performance of work, or the offering or acceptance of work, that is adopted in connection with an industrial dispute, or (c) any failure or refusal in connection with an industrial dispute to attend for work or to perform work, but does not include any action taken by employees with the agreement of their employer or any action taken by employers with the agreement of their employees. " The definition set out above in not an exhaustive definition, because of the use of the term, "includes". 32 Arguably, paragraph (a) above is on point as the industrial action of 13 November is over a practice relating to the performance of work (the removal of Trade Assistants from shift work). 33 However, the industrial action in all paragraphs set out above, has to be "in connection with an industrial dispute." The Dictionary of the Act defines "industrial dispute" as follows: " industrial dispute means a dispute (including a question or difficulty) about an industrial matter, and includes the following: (a) a demarcation dispute, (b) a threatened or likely industrial dispute, (c) a situation that is likely to give rise to an industrial dispute if preventative action is not taken. " The above definition is not an exhaustive definition, because of the use of the term "includes". 34 Arguably, paragraphs (a), (b) and (c) are not examples of the type of industrial dispute that took place on 13 November 2007. The industrial dispute was not a demarcation dispute: (paragraph (a)). The other two paragraphs concern industrial disputes that are yet to take place. But in the present case, the industrial dispute had already taken place. Be that as it may, the Commission finds that the examples in paragraphs (a), (b) and (c) are not an exhaustive list and the context of the definition/paragraphs of "industrial dispute" is one that would cover a dispute that had already taken place. 35 Finally, the definition of "industrial dispute", requires that there be an "industrial matter" as the subject of that industrial dispute. 36 The definition of "industrial matter" is found in s6 of the Act. Section 6(2) sets out examples of "industrial matters" and arguably the issue in dispute between the parties (the removal of Trade Assistants from shift work) is caught by the s6(2)(a) example of an "industrial matter": "the employment of persons in any industry…." 37 In summary, the Commission finds that the circumstances surrounding the stoppage of work on 13 November 2007, is "industrial action", for the purposes of sub-clause 36.4.3(n). Accordingly, the Commission can now consider the other terms of sub-clause 36.4.3(n) in order to determine the Company's claim that the status quo has lapsed. Re: "…over the proposed change." 38 The Commission is considering the Award provision: "The status quo will lapse in the event of industrial action over the proposed change," and will now focus on the words: "…over the proposed change." 39 Mr Sebbens submitted that the term, "over" should be given its natural and ordinary meaning in the context of sub-clause 36.4.3(n). Thus the term, "over" should be given its Macquarie Dictionary meaning of "concerning" or "about". Further, he said that the word "over" leads to an examination of a reason for the industrial action - the Commission concurs with this view. And he stated that the use of the word "over" does not require a causal connection between "the proposed change" and the "industrial action". If that were intended, the drafters of the sub-clause could have used the phrase, "because of" or "due to". 40 The Commission rejects much of that submission for the reasoning set out below. 41 The Commission finds that the context of the sub-clause in question requires a causal connection between "industrial action" and "the proposed change". Thus "over" is to be read as meaning, "because of" or "due to". So, there needs to be a causal connection between "industrial action" and "the proposed change". Thus, the industrial action was "due to" or "because of" the proposed change. 42 If the Commission were to accept Mr Sebben's submission, then a non-causal connection could have the result that industrial action over a dispute (not in any way connected to the proposed change), would have the Company arguing that a status quo arrangement had come to an end. For example. Let us say that there was a status quo arrangement in place over the present proposed change now before the Commission (the removal of Trade Assistants from shift work). Assume that members of the Union (the AWU) decided to walk off the job due to a bona fide dispute as to an occupational health and safety ("OH&S") issue. The reason for the industrial action has no connection to the proposed change issue. 43 The AWU members attend a meeting to discuss the OH&S issue. During that meeting, a union member seeks an up-to-date report on the proposed change (the removal of Trade Assistants from shiftwork). A discussion ensures amongst the members at the meeting, which eventually comes to an end and the union members return to work. 44 The Company finds out later that the proposed change issue was discussed at the union meeting and then the Company makes application to the Commission that the status quo arrangement over the proposed change has been brought to an end because the proposed change was discussed at the meeting. By inference, the Company could argue that the fact that the proposed change was discussed at the union meeting, must have been a reason for the industrial action. Thus, by inference, the Company could argue that there was a causal connection (albeit indirect) between the industrial action and the proposed change. 45 The Commission has set out the above example, in order to highlight that the key issue for determination (as to whether certain industrial action has caused the status quo to lapse), is what was the reason(s) for the industrial action. In the above example, the reason for the industrial action was an OH&S issue and not the proposed change . 46 In the present case, the issue for the Commission's consideration is: What was the reason(s) for the industrial action? If the only reason, or one of the reasons, for the industrial action was "over the proposed change" (emphasis added), then the Company's case that the status quo arrangement has thereby lapsed, would deserve the attention of the Commission. 47 The Commission will now consider the evidence surrounding the industrial action of 13 November 2007. 48 The first piece of evidence to consider is that the industrial action of 13 November was undertaken by employees who are not directly associated with the proposed change. 49 The evidence before the Commission was that there are two (2) proposed changes underway in the relevant work area. 50 One proposed change by the Company is to reduce the number of Rovers (employees) at the Paintline. This proposed change affects the production employees. 51 The other proposed change affects the maintenance employees. They are affected by the subject matter of the dispute now before the Commission - that is, the removal of Trade Assistants from shiftwork. 52 It was not the maintenance employees who withdrew their labour on 13 November, but the production employees. In other words, the employees directly associated with the removal of Trade Assistants were not the employees who withdrew their labour. Despite that being the case, witnesses for the Company gave evidence that sought to overcome this fact by arguing that there was an association between the industrial action of the production employees on 13 November and the proposed change affecting the maintenance employees. 53 One argument advanced by Company witnesses for an association was that there was an impact on the production employees in respect of the proposed change for maintenance employees. (Sellers: Tr 7, line 55 to 58; and Meta: Tr 10, line 42 to Tr 11, line 12) 54 However, evidence gained by Mr Gorgievski in his cross-examination of witnesses, showed that he refused to participate in any discussion about the proposed change (removal of Trade Assistants), where that discussion was sought to be raised in what he saw as the inappropriate forum. 55 The evidence showed that there were two fori for discussions about the two proposed changes. One forum was the Rover meetings which discussed the proposed change for production employees. The other forum was the maintenance meetings which discussed the proposed change for maintenance employees - being the proposed change for removal of Trade Assistants from shiftwork. Mr Meta (Operations Manager) confirmed, under cross-examination, that Mr Gorgievski was adamant with Mr Meta that the Rover meetings could not progress until the issue of the removal of Trade Assistants from shiftwork, was removed as an agenda item from the Rover meetings. Further, Mr Meta concurred that maintenance employees did not attend the Rover meetings. (Tr 17, line 11 to Tr 20, line 7) 56 Another line of argument advanced by the Company to show an alleged association between the industrial action of 13 November by the production employees and the proposed change for the maintenance employees, went to the topic of conversations involving the union delegate and Mr Gorgievski on the one hand and Company witnesses on the other. 57 There were a series of conversations between the union delegate (Mr O'Hare) and Mr Sellers (Relief Shift Team Leader) in the lead up to the industrial action of 13 November. Mr Sellers deposed (Ex 1) that these conversations took place between and including 9 to 12 November. He said these conversations went to a request from Mr O'Hare to him for the Company to approve a meeting of employees to discuss the removal of Trade Assistants from shiftwork. Mr Sellers "understood" (Ex 1, para 6) this request to mean all operator employees at the Paintline and this in turn would mean a shutdown of the Paintline operation. The request was put to Mr Meta and his response was in the negative. 58 From a reading of Mr Seller's affidavit, there is an inference that the request and negative response for a Company approved meeting for all operators, was met with the response of a stop work meeting of 13 November and that the subject matter (or one of) of that stop work meeting was Trade Assistants being removed from shiftwork. 59 Mr O'Hare gave evidence-in-chief that he is a union delegate but that he has not had any involvement in the discussions about the removal of Trade Assistants from shiftwork. He had only been involved in discussions at the Rover meetings concerning the proposed change for production employees. (Tr 49, to Tr 50, line 49) He had not been involved in any discussions of maintenance employees (concerning the removal of Trade Assistants from shiftwork), because he is not a maintenance employee - but a production employee. (Tr 49, line 46 to Tr 50, line 49) 60 During the cross-examination of Mr O'Hare, it was sought to show that he had been involved in discussions with the Company about the removal of Trade Assistants from shiftwork. This alleged discussion took place at a Rover meeting (which dealt with the proposed change for production employees). The evidence to support this alleged discussion was that the subject of the removal of Trade Assistants appeared on the agenda/blackboard for the Rover meeting discussion. The evidence of Mr O'Hare showed that that subject matter was written up on the blackboard for a Rover's meeting of 19 October but was not discussed. There was evidence (Ex 15), however, that the subject of the removal of Trade Assistants was a matter that impacted on the work of production employees. (Tr 51, line 26 to Tr 58, line 4) 61 The question, then for the Commission was whether this evidence of the impact (of the removal of Trade Assistants from shiftwork) on the production employees, was evidence supporting the Company's claim that the industrial action of the production employees was action over the proposed change for the maintenance employees. But it was also the case that the production employees were concerned with the impact of the Company's proposed change for them - the removal of the Rover's position and its impact on the workload of the production employees. 62 Mr Sebbens continued his cross-examination theme that the industrial action of 13 November by the production employees was due to, in part or whole, the removal of Trade Assistants from shiftwork. He did so by focussing on the conversations between Mr Sellers and Mr O'Hare. 63 There was a discussion between these two on 9 November. Mr O'Hare approached Mr Sellers. There is a disagreement between them as to the actual content but Mr O'Hare agreed that his approach concerned the two proposed changes. He denied he asked Mr Sellers for a paid meeting just to discuss Trade Assistants coming off shiftwork. 64 A second meeting between these two persons occurred the next day - 10 November. Mr Sellers does not depose that Mr O'Hare asked for a paid meeting just to discuss Trade Assistants coming off shiftwork. He deposed that Mr O'Hare asked him to request Mr Meta (Operations Manager) for approval of a four crew meeting. Mr Sellers deposed that he "understood" this to mean for the Company to approve a meeting of all operation employees on the Paintline. Mr Sellers confirmed that this conversation and hence request for a paid meeting, went to the two proposed changes (as set out in two Company documents - Ex 5 and 15) (Tr 61, line 4 to Tr 62, line 27) The two proposed changes are the removal of a Rover's position and the removal of the Trade Assistants from shiftwork. 65 A third discussion took place between them on 12 November. Mr Sellers deposed (Ex 1, para 13) that Mr O'Hare asked him once again if the Company would approve a paid meeting in order for the four crew to discuss the removal of Trade Assistants from shiftwork. Mr O'Hare denied this assertion in cross-examination. He maintained his position that his discussion with Mr Sellers was about having a paid meeting for the two proposed changes. (Tr 66, line 36 to Tr 68, line 13) 66 The industrial action then took place on 13 November. That action was taken by the production employees and not the maintenance employees who were directly affected by the Company's proposed change to remove Trade Assistants from shiftwork. 67 Apart from the Company relying upon the discussions between Mr Sellers and Mr O'Hare to support its claim as to the real reason (removal of Trade Assistants) for the industrial action, the Company also relied upon evidence of Mr Meta as to a conversation he had with the Union official Mr Gorgievski on 13 November. 68 Mr Meta deposed he was advised by Mr Sellers at 7.20am that the production employees had not turned up for work and there was a rumour of a union meeting in town (Ex 3, para 18) 69 Mr Meta deposed he telephoned Mr Gorgievski at approximately 7.45am to ascertain the situation. His affidavit sets out their conversation "in words to the effect of." Mr Gorgievski did not file a witness statement and did not give evidence in the proceedings. He appeared as an advocate for the Union. 70 Mr Meta reports that he asked of Mr Gorgievski: Are you meeting with my operators? Mr Gorgievski is reported to have replied: "The operators have got concerns about the TA issue and you won't talk to them." The term "TA" appearing in the foregoing quote is a reference to Trade Assistants. The term "operators" is a reference to the production employees, given the context of the conversation. 71 Even though there is a reference to Trade Assistants in this conversation, it does not follow that the industrial action by the production employees was industrial action of a kind, as if undertaken by the maintenance employees. This is so, as the proposed change of removing Trade Assistants from shiftwork, was an issue that also impacted on the production employees. 72 There was evidence of this impact on the production employees, given by the two Company witnesses; (Sellers: Tr 7, line 55 to 58; and Meta: Tr 10, line 42 to Tr 11, line 12) Thus, the reporting of Mr Gorgievski's conversation, as to a reference to Trade Assistants, is not necessarily reporting Mr Gorgievski to have inferred that the industrial action by the production employees was industrial action over the Company's proposed change to remove Trade Assistants from the maintenance employees. This is so, because of the Company's evidence that the maintenance employees were not the only employees impacted by the removal of Trade Assistants from shiftwork. 73 The industrial action by the production employees could have been over say, two issues: (a) the removal of one Rover (an employee) per shift and (b) the impact on the workload of production employees, if the other proposed change affecting maintenance employees (the removal of Trade Assistants) went ahead. Arguably, that industrial action by the production employees is over the proposed change that affects them, the production employees. Summary 74 This Decision concerns a claim by the Company that certain industrial action taken on 13 November 2007, had brought the "status quo" provision, contained in the Award, to an end. The status quo provision reads: "The status quo will lapse in the event of industrial action over the proposed change." 75 The evidence before the Commission was that there are two proposed changes being considered. One proposed change affected the production employees (the removal of one Rover employee per shift). The other proposed change affected the maintenance employees (the removal of Trade Assistants from shiftwork). 76 The Company claimed that the industrial action of 13 November, was industrial action over the proposed change for maintenance employees. That is, the Company claimed that industrial action by production employees, was industrial action over the proposed change to remove Trade Assistants from shiftwork. 77 In considering that claim, the Commission held, inter alia, that there needed to be shown by the Company, that there was a causal connection between the "industrial action" and "the proposed change". That is, it needed to be shown that the industrial action was "due to" or "because of" the proposed change . 78 In assessing that causal connection, that is the reason(s) for the industrial action, the Commission considered the evidence brought forward by the Company to prove its claim that the industrial action of 13 November was over the proposed change to remove the Trade Assistants from shiftwork, being a proposed change directly affecting the maintenance employees. 79 The obvious first point to consider was that the industrial action of 13 November was not by the maintenance employees who are directly affected by the proposed change. 80 Despite that fact, the Commission then considered the evidence of the conversations between Mr O'Hare (Union Delegate) and his supervisor (Mr Sellers) and Mr Gorgievski (Union Official) and Mr Meta (Operations Manager) - as to whether that evidence showed a causal connection between the industrial action and the proposed change to remove Trade Assistants from shiftwork. 81 The evidence showed that there had been attempts by the Company to raise the issue of the removal of Trade Assistants from shiftwork, at Rover meetings but the Union refused to participate in such discussions. The evidence was clear that the Union had refused to have the proposed change for maintenance employees discussed at meetings involving the production employees. The Union's stance was one of keeping the two proposed changes separate, for discussion purposes. That being the case, then prima facie, any industrial action by production employees was action over issues of concern to them and not over issues of concern to the maintenance employees. 82 Having said that, there was evidence from the Company witnesses, that the proposed change for the removal of Trade Assistants did have some impact on the production employees. But even so, if the industrial action by the production employees had as a reason this impact on them, it does not necessarily follow that that industrial action was a sympathy strike for the direct impact of the removal of Trade Assistants on the workload of the maintenance employees. 83 As to the Company's evidence that the Union delegate had had conversations with Mr Sellers, and which evidence showed (at its highest), that the Union delegate was agitating for a paid meeting for all employees to discuss the removal of the Trade Assistants from shiftwork, then such evidence goes no further than that. It was not the maintenance employees who took the industrial action. The Company still needs to show a causal connection between the industrial action of the production employees and the impact of the proposed change on the maintenance employees. 84 The evidence as to the conversation between Mr Meta and Mr Gorgievski does not advance the Company's claim. Mr Gorgievski's reference in that conversation to "TAs" can be taken as a reference to the impact of the Company's proposed change on production employees, because of the Company's evidence that that proposed change also had an impact on the production employees. 85 Having considered all of the evidence, the Commission finds that the Company has not established that the industrial action by the production employees was industrial action over the proposed change to remove Trade Assistants from the maintenance employees. Accordingly, the status quo provision found at sub-clause 36.4.3(n) of the Award, has not lapsed. A Macdonald 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.