Industrial Relations Commission of New South Wales CITATION: BlueScope Steel Limited and Australian Workers' Union, New South Wales [2008] NSWIRComm 1044 APPLICANT BlueScope Steel Limited PARTIES: RESPONDENT Australian Workers' Union, New South Wales FILE NUMBER(S): 2234 of 2007 CORAM: Macdonald C CATCHWORDS: Dispute - Referral Agreement per s146A of the Industrial Relations Act 1996 - Company proposed a workplace change at the Tension Leveller Line unit and the Manual Pack unit involving a combination of the workflow of both units into one workflow unit - change from shiftwork pattern to day work and reduction of two employees would result from proposed change - proposed workplace change is "significant in nature" - Union invoked "status quo" award provision - effect of the "status quo" provision is that the Company is unable to introduce its intended work change - award provision requires parties to confer on proposed work change - parties unable to agree on the introduction of the Company's proposed change or alternative work pattern changes proposed by the Union - conciliation at an end - Hearing - Award sets out four criteria to be considered by the Commission as to whether to grant Company's sought after remedy that the Commission revoke the status quo - onus on Union to persuade Commission not to revoke the status quo - evidence on four criteria - Held: status quo revoked - Company can introduce its proposed workplace change. LEGISLATION CITED: Industrial Relations Act 1996 CASES CITED: AWU v BlueScope Steel (AIS) Pty Ltd [2006] NSWIRComm 318 Re: Iron and Steel Works Employees (Australian Iron and Steel Pty Ltd - Port Kembla Award,....[1997] NSWIRComm 11 HEARING DATES: 21/05/08 & 22/05/08 DATE OF JUDGMENT: 9 July 2008 APPLICANT BlueScope Steel Limited Mr T Sebbens (Sol.) LEGAL REPRESENTATIVES: RESPONDENT Mr B Gorgievski Australian Workers' Union, NSW DECISION: - 18 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: MACDONALD C 9 July 2008 Matter No IRC 2234 of 2007 BlueScope Steel Limited and Australian Workers' Union, New South Wales. Notification under section 146A by BlueScope Steel Limited of a dispute with Australian Workers' Union, New South Wales re disagreement over the merge of the Tension Leveller and Manual Pack operations DECISION [2008] NSWIRComm 1044 1 The Commission has before it a notification of a dispute under s146A (Referral Agreement provision) of the Industrial Relations Act 1996 ("the Act"). That s146A notification was lodged by BlueScope Steel Limited ("the Company") on 19 December 2007. 2 The Referral Agreement listed the other party to the dispute as the Australian Workers' Union, New South Wales ("the AWU"). 3 The Referral Agreement stated the dispute to be: "The merge of the Tension Leveller Line and Manual Pack operation within the Painting and Finishing department. This includes the change of the existing roster pattern and the reduction of 2 positions." 4 The dispute was allocated to myself and listed for a compulsory conference on 20 December 2007. 5 An on-site inspection of the general work area and the specific areas the subject of the dispute, was held on 17 January 2008 - Springhill site at Port Kembla. The inspection was followed by conciliation in the precinct of the court of the Commission. 6 The matter was set down for another conference on 31 January, 2008. The issues between the parties as to the Company's proposal to merge the Tension Leveller and Manual Pack operations remained unresolved. The parties agreed that conciliation was at an end. The matter was programmed for a Hearing. 7 The Hearing took place in Wollongong. 8 The Company was represented by Mr T Sebbens, solicitor, assisted by Mr O Vrtkovski, Human Resource Advisor. Mr Sebbens called one witness: Mr Gary Meta - Operations Manager, Painting & Finishing Department (PFD) The AWU was represented by Mr B Gorgievski, union official, who called one witness: Mr David Armstrong - Level 3 Operator, PFD BACKGROUND 9 The Company put forward a restructuring plan for two work units, within its Painting and Finishing Department located at its Springhill site, Port Kembla, to be merged into one workflow unit. Those two work units are the Tension Leveller Line ("TTL") unit and the Manual Pack unit. 10 The effect of the proposed change is that those two work units would be merged as to their workflow operations. This in turn would mean that the five employees in the TTL unit and the two employees in the Manual Pack unit would learn each other's skills during an initial phase-in period. During that phase-in period, the seven employees would be assessed as to their skill to carry out the combined role of TTL work and Manual Pack work. The Company would then, per its proposed change, reduce the manning level from seven to five employees. 11 Another feature of the proposed change, is a change in the working pattern from a shift operation (for the TTL unit employees) to a day work operation - a five day week. The working pattern change for the two employees in the Manual Pack unit, is that of a change from a seven day week operation to a five day week operation. 12 For both units, this proposed change in the work pattern represents (prima facie) a reduction in income through the loss of say, shift penalty payments for the TTL employees and weekend penalty rates for the Manual Pack employees. 13 For the Company, the proposed change is about running the two work units more efficiently. The Company cited that there are times when the Tension Leveller machine has downtime - that is, is not operational. 14 The downtime can be due to an insufficient number of employees being on duty (because of annual leave or sick leave) to work the Tension Leveller or, there is a sufficient number of employees on duty but the employees have taken a crib break and thus the Tension Leveller is momentarily not working. 15 The Company and the Union conferred on the Company's proposed change to improve operational efficiencies. The Union was opposed to the Company's proposal given the loss of the jobs of two employees and the, prima facie, loss of income for the remaining five employees. 16 The Union put forward alternative working pattern arrangements that would maintain the jobs for the seven employees and, it submitted, still obtain efficiencies. 17 The Company rejected the Union's alternate proposals. 18 As the parties could not settle their differences by conciliation, then the matter went to a Hearing. The Company sought the removal of the "status quo" provision so that it could implement its proposed change. The Union opposed the removal of the "status quo" provision, and hence, opposed the Company's proposed change. FINAL SUBMISSIONS For the Company 19 Mr Sebbens, solicitor for the Company, provided the Commission with a written Outline of Submissions and spoke to those Submissions. The issues put by Mr Sebbens in final submissions were as follows: (a) The Company proposed a workplace change involving the merger of the TTL and Manual Pack units, with the resultant change from a shift work pattern worked by employees to that of a day work pattern and the reduction of two employees. (b) The Union was opposed to that workplace change and invoked the "status quo" award provision. (c) The Company seeks, per this Hearing, to have the Commission remove the operation of the "status quo" provision, so that the Company can implement its proposed change. (d) The relevant award test for the Commission to apply in considering whether to remove the "status quo" provision, is whether the proposed change is "safe, efficient, legal and fair". Mr Sebbens took the Commission to the evidence in support of the Company's claim that the Company's proposed change was "safe, efficient, legal and fair". (e) The onus for showing that the "status quo" should not be removed, or that the Company's proposed change should be resisted, falls upon the Union which opposes the change. (f) The "status quo", invoked by the Union, should be removed by the Commission because the proposed change is not unsafe, inefficient, illegal or unfair. For the Union 20 Mr Gorgievski, Union Official, provided the Commission with a written Outline of Submissions and spoke to those Submissions. The issues put by Mr Gorgievski in final submissions were as follows: (a) The Company's proposed change is about meeting objectives regarding cost efficiency, processing a backlog of stock, maximizing productivity, and maximizing product quality, safety and delivery on time. The Union submitted that these objectives had not been met and referred to evidence to support that submission. (b) The Union submitted that the five employees in the TTL unit could be gainfully employed on their previous shift arrangement of two shifts over a five day week. The two employees in the Manual Pack unit could be gainfully employed on their current work arrangement of twelve hours per day over seven days. (c) The Union submitted that if the Tension Leveller operation has a downtime issue, then that issue should be dealt with per se, and not include the Manual Pack unit. (d) The Union submitted that the TTL unit and the Manual Pack unit are two different structures with two different career paths and should remain that way per the 1998 Agreement for The Restructure of the Finishing Department, Springhill Works, Coated Division, BHP Steel. (e) The employees would be financially disadvantaged by the Company's proposed change. (f) If the Company's proposed change was granted by the Commission, their two employees will lose their jobs following a selection procedure. The Union said that that selection procedure would not be fair because the two Manual Pack employees have not had the experience of working higher levels of equipment (the Tension Leveller). (g) The Union submitted that the Company's proposed change had not met the criteria of being "safe, efficient, legal and fair". CONSIDERATION The Company Proposal 21 The Company proposes a workplace change that would see the merger of two work units: the Tension Leveller Line ("the TTL") unit and the Manual Pack unit. This would result in a single unit operation for the levelling and packing of reworked coil product. 22 The proposal would effect the existing roster patterns of the two work units, which currently is: two shifts over 5 days for the TTL unit; and a 12 hour day over 7 days for the Manual Pack unit. The Company proposal would see an 8 hour day over a 5 day roster for the employees of the merged unit. 23 The merger of the two units would see a reduction of two positions, from the current 7 employees to 5 employees. Presently, there are 5 employees in the TTL unit and 2 employees in the Manual Pack unit. The Award & The Company Proposal 24 The relevant Award (BlueScope Steel Limited - Springhill and CRM Works Employees Award 2006), prescribes how a Company proposal to introduce workplace change, is to take place: Clause 36.4 Introduction of Change Including Outsourcing. 25 That clause sets out the procedure for the introduction of workplace changes which are "significant in nature" or which are not "significant in nature". The Company concedes that its proposal is "significant in nature", that is, the Company concedes that its proposal will have substantial effects on the criteria set out in clause 36.4.2(c). 26 The Award prescription identifies the following consultation process with its employees and the Union for the introduction of "significant in nature" workplace change: (a) The Company commences consultation with a notification in writing to employees and their union(s) (Letter 1) as to the broad objectives of the change and the possible effect the change is likely to have on employees: clause 36.4.3(d)(e) & (f). The Company issued Letter 1 on 27 July, 2007. (Ex 1 - PFD1). Consultations commenced on 16 August 2007, with on-going consultation with employees and the Union. (b) Following consultations as to all aspects of the proposed workplace change, the Company will advise employees and the relevant union(s) in writing (Letter 2) as to whether or not the Company will proceed with the introduction of the proposed change: clause 36.4.3(g). The Company issued Letter 2 on 25 September, 2007, advising of its intention to proceed. (Ex 1 - PFD2) . That letter also stated the Company's intention to implement the change on Monday, 5 November and consultation would continue. During that further consultation, the employees and the Union put forward alternate proposals for workplace change for the two units. (Ex 1 - PFD3). The Company rejected the alternate proposals. (c) The consultation process will conclude upon any party to the process, declaring to the other parties in writing (Letter 3) that it regards the consultation process as exhausted: or an agreement is reached between the parties to the consultation on a settlement to the issues; or notification is made under the Act ( Industrial Relations Act 1996) of an industrial dispute as to the change: clause 36.4.3(h). The Company issued Letter 3 on 26 October, 2007, advising the Union and employees that it was the Company's view that the consultation process had been exhausted and the Company intended to implement its workplace change on Monday, 5 November 2007. (Ex 1 - PFD4) (d) Where the consultation process concludes upon a party declaring to the other parties that it regards the consultation process as exhausted, and there is disagreement as to the change proposed, the change may be implemented forthwith unless a party to the consultation process gives notice to the other parties that it disputes the implementation of the change, and in that case the status quo will apply. Notice of disputing a change must first be provided to the other parties verbally within 24 hours after the declaration that the consultative process is exhausted, and followed up by written notice in accordance with 36.4.3(k): clause 36.4.3(j). The Union invoked the status quo provision on 31 October, 2007. (Ex 1 - PFD5) The effect of invoking the status quo provision, is that the Company is unable to implement its workchange proposal. (e) There must be no industrial action whilst these procedures, including status quo where applicable in this clause, are followed, and subject to further discussions between the parties, the matter will be referred to the Commission. No industrial action took place. The Company issued a Referral Agreement, pursuant to s146A of the Act , to the Union on 7 November, 2007, in order to refer the matter to the Commission. The Union signed the Referral Agreement on 13 December, 2007 (Ex1 - PFD6). 27 The Commission held a compulsory conference of the parties on 20 December, 2007. An inspection of the work area and the work units in particular took place on 17 January, 2008. Further conciliation was held on 31 January but to no avail. The Commission issued a Certificate of Attempted Conciliation on that date and the matter was programmed for a Hearing. Onus 28 The Union opposes the Company's proposed workplace change and seeks to maintain the status quo arrangement which has the effect of preventing the Company from implementing its proposed change. The Company seeks the status quo be removed. The onus "falls upon the Union to make out a case that the changes proposed by management should not be made or should be offset by some compensation or other adjustment in conditions of employment". : AWU v BlueScope Steel (AIS) Pty Ltd [2006] NSWIRComm 318 (at para 21). The Relevant Test 29 The relevant test for the Commission to apply, in considering whether to grant the Company's remedy of removing the status quo, is the fourfold test set out in clause 36.4.1(c). That is, the Commission is to consider whether the proposed change is: safe; efficient; legal; and fair. The Commission is required, by law, to consider that fourfold Award prescription criteria and not substitute some other case law concerning managerial prerogative prescription, such as: Is the Company proposal reasonable and fair?: AWU v BlueScope Steel (AIS) Pty Ltd [2006] NSWIRComm 318 (paras 15 to 20). The Commission will now consider the evidence and submissions surrounding those four criteria. The Safety Criterion 30 The Company's proposal goes to the merger of two separate work units. The evidence before the Commission is that the work carried out by the employees in the two work units has some overlap in skills used but it seemed to the Commission that the work performed is largely different in nature. 31 The proposed merger will initially have the two Manual Pack employees and the five TTL employees carrying out the combined work of both units. This will require training for all seven employees to be able to perform the work of the Manual Pack and TTL Units. It seemed to the Commission that more training will be required for the Manual Pack Unit employees to learn the TTL work, rather than the other way around. In any event, training was acknowledged as a required prerequisite by Mr Meta and, as such, he deposed that that will deliver a safe working environment. (Ex 3, para 10). 32 Under cross-examination he said that no safety issues had been raised with him in respect of the Company's proposal. He did advise that an issue as to "stress" had been raised from the operators. This "stress" went to the Company's proposal - that is, a new work system whereby the operators would be working the TTL Unit, have the requirement to perform the Manual Pack Unit work, and have the potential requirement to work extra shifts. Mr Meta did not believe that that new work system would be onerous or difficult to manage and explained his view in that regard. 33 Finally, on the issue of safety, Mr Meta gave evidence that there is a toolbox meeting between the operators and the shift supervisor at the start of a shift. That meeting identifies work priorities and any safety issues. There is also a policy document, called the JSEA (job safety and environmental analysis), where work teams collectively produce a method for dealing with hazards on a particular task that's not already covered by normal procedures. (Tr 21/05/08 - p33, line 36 to p35, line 47). 34 Mr Armstrong, an employee of 30 years service, gave evidence. He has spent virtually that entire 30 years in the TTL Unit. 35 Under cross-examination, Mr Armstrong concurred he had not raised any safety issues about the Company's proposal during the consultation stage. He was not aware of any other operators raising any safety issues. (Tr 22/05/08 - p33, line 23 to p34, line 7). 36 Under re-examination, he said he had a safety concern if he and other employees had to work excessive overtime as this would lead to tiredness and distraction on the job. (Tr 22/05/08 - p47, line 11 to 34). The Efficiency Criterion 37 Mr Meta deposed that the Company's proposal to merge the TTL and Manual Pack Units would produce certain efficiencies. Simply put, these efficiencies would be of a cost saving nature and an improvement in work product flow and output. 38 The cost saving would come about by the reduction of two positions (seven employees reduced to five employees) and reduction in shift allowances. Those reduced costs would be in the order of $215,000 to $230,000 per annum. (Ex 2, para 19) (This costs reduction item is also an issue for consideration under the Fairness criterion given its disadvantage to the employees). 39 The work flow and product output efficiency revolves around the TTL machine and the processing of coils in the Manual Pack Unit. 40 The TTL machine has not always operated continuously - that is, there is downtime. This downtime can be caused by crib breaks by the TTL operators or by absenteeism (say annual leave or sick leave). Whereas the TTL machine has a short downtime for crib breaks, the TTL machine may be unable to be run due to insufficient manning because of absenteeism. The downtime results in lost production time. The downtime also has the effect of adding to the backlog of tonnes to be processed. (Ex 2, paras 9 to 18 inclusive). 41 Where there is say, an absenteeism in the TTL Unit and which causes downtime, the Company is unable to draw upon the services of the operator in the manual Pack Unit for assistance, because the two work Units are separate work areas. The Company's proposal to merge the two work Units, would allow the Company to draw upon the services of the operator working in the Manual Pack area for assistance. That is, the Company's proposal of having a merged operation, would allow a supervisor to prioritise the workflow of the TTL operations or the Manual Pack operations, as the work demanded. That prioritising factor does not exist under the present work arrangement, said Mr Meta. 42 Of course, in order for the Company to draw upon the services of the operator working in the Manual Pack area, it would be necessary that that operator have the skills to perform the TTL Unit work. Presently, the two Manual Pack Unit workers do not have those skills. Under the Company's proposal, all seven employees (five in TTL and two from Manual Pack) would be trained up in the skills required for either work station. Subsequently, an assessment would be carried out as to which five employees would be retained to perform the work, as required, in either work area. Thus two employees would be surplus to requirement and would no longer work in those merged work stations. 43 As to the five employees still employed in the merged work and following the assessment process, Mr Meta gave evidence that three of the employees would operate the TTL machine (one of the three employees would perform the relief role while the other two had their cribs break); the remaining two employees would do manual packing. (Tr 21/05/08 - p22, line 37 to 43). Presently, there is one only Manual Pack operator per shift, said Mr Meta. Each operator works four days on and four days off. (Tr 21/05/08 - p12, line 22 to 26). 44 Under cross-examination from the Union, Mr Meta agreed that having a two shift operation for the TTL Unit (as was the case but now presently a one shift operation), would, "on paper", mean increased capacity output for the TTL Unit. However, he said that the two shift operation had a cost burden and the TTL machine was not often able to run because of downtime. (Tr 21/05/08 - p 37,line 30 to p41, line 15). The downtime is due to crib breaks or short labour. Mr Meta agreed, under cross-examination, that downtime due to labour shortage was for a short time period and may have only been for one week. (Tr 21/05/08 - p38,line 42 to p39, line 5). 45 The Union raised another issue about the efficiency of the Company's proposal and that issue went to the need for overtime. Mr Meta agreed that the proposed merger would require the working of overtime by the operators. The Union presented evidence as to overtime worked from 18 January to 4 May 2008 (13 overtime shifts per person in that period). Mr Meta responded that that data only equated to one overtime shift per person per week and that the working of such overtime had not been a point of tension between management and the operators to work those overtime shifts - except for a one off incident in December, 2007. (Tr 21/05/08 - p41, line 22 to p43, line 25). 46 It has already been recorded, under the Safety Criterion, that Mr Armstrong raised the issue of working excessive overtime and the impact of that on the operators - tiredness and distraction on the job. The Commission notes that the Union's evidence as to overtime is that there had been 13 overtime shifts per person (one overtime shift per person per week) over the 18 January to 4 May 2008 period. 47 Under cross-examination, Mr Armstrong was questioned about the amount of overtime required, in the future, to be worked. He agreed that there is the "potential" for less overtime to be worked if the Company's plan to speed up the TTL machine (to process output more quickly) was put into place and there was less "non-prime" (defective) product being fed into the TTL machine. (Tr 22/05/08 - p38, line 31 to p39, line 46). 48 Although the above questioning produced, in reality, a scenario of only a "potential" for less overtime being required in the future, Mr Meta did give evidence that the TTL machine has had a drop off in the amount of defective tonnes put through the TTL machine. The drop off is due to less defects in the product produced. (Tr 21/05/08 - p14, line 4 to 50). 49 The Union questioned the alleged efficiency output as to the number of coils that would be produced per day under the Company's proposed merger. Presently, 30 coils per day are processed over a 12 hour shift. Under the Company's proposal, only an 8 hour day would be worked by the operator in the Manual Pack area. This would indeed mean a lesser number of coils being produced by one operator but Mr Meta stated that he would have (or could have depending on workload) two operators in the Manual Pack work area. Two operators would mean greater output. (Tr 21/05/08 - p62, line 31 to p65, line 2). 50 The Commission notes that, mathematically speaking, two operators working 8 hours per day would produce more coil (40 coils per day) than one operator working 12 hours per day (30 coils). 51 During the consultation stage, the Union had put forward its own counter proposals for improving the efficiency of the two work units. One proposal was for the merger of the Manual Pack Unit with the Coil Pack Line area. Mr Meta was questioned by the Commission about this proposal (set out in Mr Armstrong's witness statement). Mr Meta said that the Coil Pack Line area was a free standing unit and there was no natural work flow between the Manual Pack Unit and the Coil Pack Line area. Under cross-examination from the Union, he agreed that certain Coil Pack Line employees ("fixed termers") had supplemented the Manual Pack Unit with labour but maintained that there was no natural work flow between the two work areas in question. (Tr 21/05/08 - p77, line 36 to p83, line 50). The Legal Criterion 52 The Company's proposal to merge the TTL Unit and the Manual Pack Unit, is a significant workplace change and, as such, the Award prescribes the method of notice to the employees and the consultation required to be engaged in by all parties about that proposed workplace change. The Company tendered a document (Ex 1) setting out its compliance with that Award prescription - including the consideration of two workplace changes proposed by the Union. The Union did not challenge that documented evidence as to the Company's compliance with the legal prescription set out in the Award. 53 Mr Armstrong, however, deposed that the Company could not legally direct an employee to carry out work that was not part of his/her contract of employment. For example, the Manual Pack employees could not be directed to perform the work carried out in the TTL Unit. Accordingly, he inferred, the Company's merger proposal could not be put into effect. (Ex12, paras 3 & 4). This view of Mr Armstrong has merit on its face. There is case law that an employee is under no duty to perform work beyond that for which he/she was engaged under their contract of employment. But, this issue raised by Mr Armstrong is not so straight forward. The Award in question also comes into play because it sets out an agreed procedure between the Company and the Union/employee for the introduction of work place change. Thus the Award provides the mechanism by which the Company can seek to introduce change and which can mean (as it does in this case) that employees need to learn new skills - if the Commission decides that the status quo is to be lifted and the Company can pursue its merger proposal. 54 As the Award provides an agreed procedure between the Company and the Union/employee for the introduction of workplace change and the consequent need to learn new skills, then the Company's proposal is not in breach of the Legal Criterion - as argued by Mr Armstrong and the Union. The Fairness Criterion 55 There is a downside for some or all employees affected by the Company's proposed merger of the two units. The Company's proposal would result in the loss of two positions and the loss in remuneration. 56 As to the loss of two positions, the Union claimed during the cross-examination of Mr Meta that the two employees who would lose out, would be the two Manual Pack operators because they lack the higher work skills required to operate the TTL machine. Mr Meta countered that all employees would be given the necessary skills training to perform work in both the TTL and Manual Pack Units; that an assessment would then be carried out and a merit based decision made as to which five employees would be selected to work in the merged work areas. 57 As to the two actual employees who would be surplus to requirement (that is, lose out), they would be managed in accordance with the provisions concerning surplus employees under the Award. (Meta: Ex 2, para 30). 58 It might also be the case, that no actual employees are made surplus to requirement, because of certain evidence given by Mr Armstrong. He deposed that some employees may decide to take redundancy, if the Commission accepted the Company's argument that the status be revoked. (Ex 12,para 11). 59 The loss of remuneration under the Company's proposal has certainty. That loss of remuneration was conceded by Mr Meta. The loss, under the Company's proposal, would come about by the changed work roster pattern: loss of shift and weekend penalties. 60 It would not be the case, according to Mr Meta's evidence, that the loss of that remuneration could be offset by the working of overtime, because his evidence is that the TTL machine will work more efficiently in the future and hence, it must follow, there will be less opportunity for the working of overtime, then now exists (on average, one overtime shift per operator per week). 61 In final submissions, Mr Sebbens addressed this loss of earnings issue by referring to the extended notice period given by the Company about its proposal to the employees and that that extended notice period allowed employees to adjust their financial commitments in line with the reduced earnings - if the Company's proposal was to be put into place. Mr Sebbens relied upon case law in support of that notion of extended notice period, as being a fair policy application for ameliorating loss of earnings: Re Iron and Steel Works Employees (Australian Iron and Steel Pty Ltd - Port Kembla) Award, BHP Steel (AIS) Pty Ltd….Notification by BHP Steel (AIS) Pty Limited under s204 of the [1997] NSWIRComm 11 (19 February 1997). 62 Another objection raised by the Union to the Company's proposal, is the impact on employee's career paths. The Union submitted that the two work areas had separate career paths and that should remain so. 63 Mr Meta gave evidence, under cross-examination, that the Manual Pack operators no longer have a career path. Mr Gorgievski then put to Mr Meta that employees should have the choice under their contract of employment to remain in the job of their choice (to protect their career path of choice). Mr Meta responded that the Company has a requirement to train employees up to their highest skill levels (Tr 21/05/08 - p55, line 5 to p56, line 11). 64 The Commission has already considered this argument from Mr Armstrong that an employee cannot be called upon to perform work outside of their contract of employment. That argument ignored the Award prescription that work changes (and hence impact on say, career paths), can be introduced into the workforce. CONCLUSION 65 The Company has put forward a proposal to its relevant employees, to merge the Manual Pack and TTL Units. The Company has followed the Award prescription about its proposal to introduce workplace change. The Union is opposed to the workplace change and invoked the Award prescription called "status quo" in order to prevent the Company from implementing its proposal. The Company took the next step, per the Award, and sought that the Commission arbitrate over the Company's proposal. That is, the Company seeks that the Commission make a decision to order the lifting of the status quo provision. The Union, of course, is opposed to the revoking of the status quo provision. The Union carries the onus to show that the workplace changes proposed by the Company should not be made. 66 In considering whether to grant the Company's sought after remedy of removing the status quo, the parties are to address the fourfold test set out in the Award at Clause 36.4.1(c). That is, the parties are to put up their evidence as to whether the proposed workplace change is: safe; efficient; legal; and fair. The Commission is to then deliberate on that evidence and decide whether the proposed workplace change is: safe; efficient; legal; and fair. 67 Is the Company proposal safe? Mr Armstrong concurred that he (an operator of virtually 30 years in the TTL Unit), had not raised any safety issues during the consultation period concerning the proposed change. He did raise a safety concern if he and other employees had to work excessive overtime. 68 There was evidence that the average overtime worked between January and May 2008, was one overtime shift per operator per week. There was no evidence that this amount of overtime was excessive. For example, there was no evidence of protests by the operators about this level of overtime. 69 There was evidence from Mr Meta that he expected the level of overtime to decrease by way of say, increasing the feed of product through the TTL machine. 70 Having considered the evidence, the Commission finds that there is no evidence (apart from speculation) that there will be excessive overtime required to be performed, if the Company's proposal is permitted to be put into operation. Accordingly, there is no evidence that the Company's proposal is not safe. 71 Is the Company proposal efficient? Mr Meta advised in the affirmative in two ways; cost savings and improvement in product flow and output. The workflow efficiencies are of two kinds; continuous operation of the TTL machine, instead of stopping for crib breaks; and having the flexibility to move staff from the TTL Unit to the Manual Pack Unit (or vice-versa) in order to meet the work demands of either Unit. That flexibility does not now exist. 72 Mr Meta addressed two counter proposals, for improved efficiencies, put by the Union and Mr Armstrong. 73 The Union's proposal was to revert to a two shift operation. Mr Meta agreed that two shifts would produce more output than his one shift proposal. But he argues against the Union's proposal on the basis of its increased costs (shift penalties and weekend penalties) and the downtime that would follow for the TTL machine: that is, insufficient staff due to absenteeism would mean that the TTL machine would not be functioning. That, in itself, would lead to further costs. It appeared to the Commission that it was the downtime for crib breaks that had the largest impact on downtime. 74 The Commission takes the view that the Company's argument that its proposal provides for more increased productivity through the diminution of downtime is a persuasive argument in favour of its proposal. 75 Mr Meta addressed Mr Armstrong's proposal that the Manual Pack Unit should be merged (not with the TTL Unit) but with the Coil Pack Line area. The Commission accepts Mr Meta's evidence that there is no natural work flow between the two work areas in question and accordingly, Mr Armstrong's proposal is not a viable option against the Company's proposed merger of the Manual Pack and TTL Units. 76 The Commission finds that the evidence supports the Company's argument that its proposal is efficient. 77 Is the Company's proposal legal? Mr Armstrong and the Union argued that the Company's proposal would have employees carrying out work that is outside their contract of employment and, as such, this would not be legal. The Commission rejects this argument. The Award sets out an agreed procedure between the employer - employee - and Union for the introduction of work change and the consequent need for employees to learn new work skills that are outside their skills carried out under their contract of employment. 78 Is the Company's proposal fair? It is this criterion that has a downside for some or all employees. There is a loss of shift and weekend penalties and the loss of two positions. 79 The Company acknowledged those losses. But as to the loss of remuneration, the Company referred to case law to support its position that it had taken the fairness criterion into account, by giving extended notice (several months) of its desire to introduce its proposal. This notice period allowed employees to adapt their financial circumstances accordingly - just in case the workplace change came into operation. 80 On the evidence before it, the Commission is persuaded to follow the case law (and its reasoning) referred to by the Company. 81 As to the loss of two positions, the Commission was left with uncertainty as to the real impact of this issue. This was so, as Mr Armstrong gave evidence that suggested that two employees would not lose their positions, as some (or all?) of the operators would prefer redundancy. He also said that the operators would make a decision in that regard once the Commission handed down its decision in this matter. 82 The context of his evidence seem to be that the Company would not need to determine which two employees were surplus, as there would not be enough employees left to meet the reduced manning level of five employees. Accordingly, the Commission can not consider this issue any further and this issue is not an argument that the Company's proposal is not fair. 83 Apart from those two issues, there is one other issue, as to career paths, the Commission will comment on. The Commission, with respect, saw no merit in this case, in the Union's argument that the Company's proposal was unfair, because the proposal would do away with the traditional separate career paths of the two work units in question. 84 Given the foregoing conclusions concerning the evidence surrounding the four criteria to be considered by the Commission as to whether the Commission should revoke the status quo provision, the Commission hereby revokes the status quo provision which has been in place. 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.