Australian Workers' Union v Australian Steel Mill Services Pty Limited [2005] NSWIRComm 1186 (14 November 2005)

Last Updated: 16 November 2005

NEW SOUTH WALES INDUSTRIAL RELATIONS COMMISSION

CITATION : Australian Workers' Union v. Australian Steel Mill Services Pty Limited [2005] NSWIRComm 1186

FILE NUMBER(S): 1785

HEARING DATE(S): 14/11/2005

EX TEMPORE DATE: 14/11/2005

PARTIES:

APPLICANT

Australian Workers' Union

RESPONDENT

Australian Steel Mill Services Pty Limited

JUDGMENT OF: Connor C

LEGAL REPRESENTATIVES

APPLICANT

Darryl Anderson

Australian Workers' Union

RESPONDENT

Gordon Jervis

CASES CITED: Kellogg (Australia) Pty Limited v. National Union of Workers (1998) 89 IR 391

New England Area Health Service Dispute Case - unreported

Nowra Coaches Case - unreported

LEGISLATION CITED: Industrial Relations Act 1996

JUDGMENT:

INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

CORAM: CONNOR C

Monday, 14 November, 2005

Matter No IRC 1785 of 2005

Australian Workers' Union and Australian Steel Mill Services Pty Limited

Dispute notification under S.130 of the Industrial Relations Act, 1996 re allocation of work for new loader

DECISION

[2005] NSWIRComm 1186

Background

1 A notification of an industrial dispute was lodged for and on behalf of Australian Steel Mill Services Pty Limited under S.130 of the 1996 Industrial Relations Act when members of the Australian Workers' Union employed by it commenced a strike and were, according to ASMS, threatening to withdraw essential services to the Port Kembla steelworks. The employees are covered by the terms of the Australian Steel Mill Services Pty Limited Enterprise Award, which contains a grievance settling procedure which ASMS assert was not followed on this occasion (although the AWU claimed that at no time were essential steelworks services affected by the strike).

2 The matter was allocated to me and I set it down for a conference on Friday, 8 April, 2005 (in Sydney). I recommended an immediate resumption of work (which occurred) and adjourned the matter for a further conference to address the issue in dispute on Monday, 11 April, 2005 and a mention on Monday, 18 April, 2005 (in the Commission's premises at 90 Crown Street, Wollongong). In the meantime, I had directed the parties into further discussions.

3 The issue in dispute in these proceedings is, to say the least, unusual. Briefly stated, the ASMS employees are not, in fact, refusing to perform maintenance work on a new item of equipment but, according to them, are being denied the right to do so by ASMS management. The industrial dispute, in fact, centres around the conversion of a new loader [992D] for ASMS. A contract had been entered into between ASMS and WesTrac Pty Limited - a maintenance and repair customer support agreement - for this work which is intended to be performed on the ASMS site. That raised some concerns by the ASMS employees who believe that maintenance work ordinarily and properly performed by them was being taken from them and, consequently, their job security was being eroded. They had initially sought to retain a role in the maintenance of the plant item but subsequently accepted that, for the first 1,000 hours at least, that work would remain with WesTrac. After that 1,000 hours, they nevertheless believed that the maintenance programme should revert to them.

4 In the proceedings before me on Monday, 18 April, 2005 ASMS indicated that it would be prepared to give an undertaking that the maintenance agreement with WesTrac for the loader would not involve a threat to the security of employment of any ASMS employees. Mr Andrew Wilson, the chief executive officer of ASMS, had written to the AWU in those terms on Monday, 18 April, 2005, viz:

"...I confirm with you my unequivocal undertaking...that the maintenance agreement for the 992D loader with WesTrac is neither intended to nor shall result in a threat to the security of employment of any current ASMS workshop employee..."

I would have thought that the unambiguous and unqualified undertaking given by ASMS went a substantial way to resolve this industrial dispute. But it remained a live area of concern.

5 The AWU had in the first place expressed the view in the proceedings on Monday, 18 April, 2005 that if WesTrac was performing the work in question it should do so off site. However, what dictates where that work is to be performed - and who is to perform it, for that matter - is the contractual relationship which exists between ASMS and WesTrac. Put simply, if that is a term of the maintenance agreement, then it should be preserved and neither the AWU nor the Commission is entitled to challenge it in the current S.130 proceedings (although there may be some action that the AWU may contemplate under the unfair contract regime of S.106).

6 On that basis, I stood the matter over for mention on Tuesday, 17 May, 2005 (in Wollongong). However, the AWU sought that I reconvene the proceedings earlier and I set the matter down for a mention instead on Tuesday, 26 April, 2005 (also in Wollongong). My approach to the problem was to direct the parties into further discussions. I outlined my position in the proceedings. The transcript records my forthright comments, viz:

"...To be frank with you, this is one of those cases that I don't think I can assist you with. Because S.130 does not allow me to intrude into a contractual relationship entered into between two parties - WesTrac and ASMS - and the employees have to accept that arrangement... That having been said, it seems to me that it's like having a dog and barking yourself, with respect, if you've got employees who are capable of doing this maintenance work, that it could be done in that way. But that is a matter for the parties to consider..."

7 I adjourned the matter for mention on Tuesday, 17 May, 2005 (in Wollongong), directing the parties into discussions in the meantime. I indicated that I would be prepared to issue a certificate of attempted conciliation under S.135 and programme the matter for arbitration, but I expressed reservations that the dispute between the parties was capable of being addressed by arbitration in S.130 proceedings. I was comforted by the fact that, at least for the first 1,000 hours, there should be no dispute - sufficient time, I thought, for the matter to be effectively resolved by constructive discussions involving the AWU, ASMS and WesTrac.

8 The matter resumed before me for the mention on Tuesday, 17 May, 2005 and was stood over generally at that time. However, at the request of the AWU, I reconvened the proceedings again for further conference on Friday, 3 June, 2005 (in Wollongong). The AWU had summonsed the production of the contract between ASMS and WesTrac for the maintenance and repair of the 992D loader. That maintenance contract was handed over in the proceedings in compliance with the summons and I stood the matter over generally again until a further mention on Tuesday, 26 July, 2005 (in Wollongong) again at the request of the AWU.

9 In the proceedings before me on Tuesday, 26 July, 2005 Mr Anderson, representing the AWU, drew my attention to what he described as a number of incidents where the ASMS maintenance staff had actually been called upon to perform the work of maintenance on the loader that, he believed that, in accordance with the contractual arrangement ASMS had with WesTrac, would not have been allocated to them. If there is some de facto procedure in place, I believed that it was important that ASMS regularise its position. As I have indicated earlier in proceeding before me over this issue, I do not wish to intrude too far into the contractual arrangements between ASMS and WesTrac but the parties should appreciate that this is not something which should be left unresolved. Otherwise a vacuum will be created in the maintenance programme which will not be in anybody's interests. Simply stated, if the ASMS maintenance staff are actually performing the work in question, in my opinion they should be authorised to do so.

10 I adjourned the proceedings for further mention on Monday, 8 August, 2005 (in Wollongong). The matter remained in dispute, however. Notwithstanding what I observed to be obvious jurisdictional issues over the matter before me, it seemed to me that I must programme this long outstanding matter to hearing and I did so, issuing the certificate of attempted conciliation required by S.135 and lodging it in the prescribed manner.

11 The hearing took place on Monday, 14 November, 2005 (in Wollongong). In the hearing Mr Anderson continued to represent the AWU and Mr Jervis represented ASMS. Essentially, Mr Anderson sought clarification of the position of the ASMS maintenance employees for any maintenance work on the 992D loader. He wished to know simply whether WesTrac or the ASMS employees were solely responsible for the maintenance of the loader. By that time the loader has been on a maintenance programme exceeding the 1,000 hours that had originally been the AWU's concession for WesTrac to retain control of the maintenance work. The ASMS have apparently continued to perform some maintenance work on the loader.

The Contract

12 Whilst there are certainly jurisdictional issues with Mr Anderson's claims in this hearing (which I will discuss in more detail later in this decision), I have to say that his request is not an unreasonable one. He simply seeks clarification, ie whether the maintenance work on the loader should be performed by WesTrac or ASMS employees. But the issue is not as simple as Mr Anderson has categorised it. Mr Jervis has provided to me the maintenance contract ASMS has enter into with WesTrac which leaves certain maintenance responsibilities on the loader to ASMS, and presumably its employees, eg daily, weekly and monthly service, pre-start checks, top up of oils and coolants, cleaning, etc.

13 But I must confess that I foresee problems flowing from the arrangement of work under the contract it has with WesTrac, viz:

1. Whilst ASMS may have responsibility for some maintenance of the loader by virtue of its contractual relationship, that contract only binds WesTrac and ASMS - not strictly ASMS employees. Of course, the ASMS employees would be obliged to perform work as directed by ASMS management and what work they are called upon to perform on the loader is obviously dictated to them by the contract ASMS has entered into with WesTrac. But for that reason I believe that it is crucial that ASMS management indicate in clear and unambiguous terms what the responsibilities for the ASMS employees actually is with respect to the loader. I direct that ASMS management communicate that information to the employees.

2. There is one condition of the contract ASMS has with WesTrac which I believe may create logistic problems in the future. The contract provides that if WesTrac is not able to respond for maintenance of the loader within two hours, ASMS reserves the option of having the maintenance work performed elsewhere - presumably by its own employees. This has apparently occurred in the past on one occasion which was the subject of discussion before me in the reconvened proceeding before me on Tuesday, 26 July, 2005. But the fact remains that ASMS may not be able to exercise its option in that respect for at least for two hours and it may be that time is critical for the item to be brought back on line.

Jurisdiction

14 I now turn to consider the jurisdictional issues concerning this most unusual matter. Firstly, as Mr Jervis has indicated in his submissions, this dispute centres around a maintenance agreement between ASMS and WesTrac and I lack jurisdiction in arbitration in S.130 proceedings to essentially make an order binding those two parties contrary to the contractual arrangements that they have made. The AWU members are essentially third parties to that contractual arrangement and the issue in dispute is not an industrial matter within the context of S.130 proceedings. An "industrial matter" as defined in S.6 essentially means the relationship between an employer and its employees. The ASMS are not in any "industrial" relationship with WesTrac to bring the matter under my jurisdiction under S.130.

15 Secondly, the claim made by the AWU in these S.130 proceedings really raises questions of interpretation of the formal terms of the maintenance contract between ASMS and WesTrac. S.175 does contemplate interpretation of an "instrument" in these S.130 proceedings, viz:

"The Commission may, for the purpose of exercising its functions in connection with a matter before it, determine any question concerning the interpretation, application or operation of any relevant law or instrument (including the industrial relations legislation and any industrial instrument."

It is certainly arguable that the maintenance contract between ASMS and WesTrac would be an "instrument" for the purpose of S.175. To my mind, the word "instrument" in S.175 gives a very wide scope for a member of the Commission to act.

16 But, the words I have emphasised - "...for the purpose of exercising its function in connection with a matter before it..." - are also important. As I have indicated in my unreported decision of Wednesday, 23 May, 2001 in the New England Area Health Service Dispute Case [Matter No.IRC 3547 of 2000] and the Nowra Coaches Case [Matter No.IRC 6159 of 2002], S.175 cannot be the source of my jurisdiction to interpret an instrument. S.175 is facilitative only, to authorise me during any proceedings, including those falling under S.130, to interpret such an industrial instrument.

17 Questions of interpretation remain primarily a judicial function and the subject of declaratory relief, something which is reserved to the Commission on Court Session by virtue of S.154, viz:

"(1) The Commission in Court Session may make binding declarations of right in relation to a matter in which the Commission (however constituted) has jurisdiction. The Commission in Court Session may do so, whether or not any consequential relief is or could be claimed.

(2) Proceedings before the Commission in Court Session are not open to objection on the ground that a declaration of right only is sought."

18 Hungerford J in Kellogg (Australia) Pty Limited v. National Union of Workers (1998) 89 IR 391 explained the limitations on jurisdiction in the S.130 proceedings over the question of interpretation in the following terms (at p.392):

"...Although the arbitration was before the Commission, moved by Kellogg pursuant to S.136(1)(d) of the Act to '...make any other kind of order it is authorised to make...' in relation to the dispute, it was clear that the relief sought arose in the dispute proceedings but was in the nature of a declaration as to the right of Kellogg to implement its proposals having in mind the provisions of the award. By reason of S.154 of the Act, relief of that nature is exclusively within the declaratory jurisdiction of the Commission in Court Session..."

Conclusion

19 For those reasons, I am satisfied that the AWU claim before me in these S.130 proceedings, as it has ultimately been pursued, is beyond jurisdiction. I propose to dismiss the matter on that basis. The ASMS employees must appreciate that their work on the loader is dictated by the terms of the agreement reached between ASMS and WesTrac and they must work in accordance with that agreement. They have no right to apply their own rules in that respect.

20 But I dismiss the matter with some reservations that the issues between ASMS and the AWU should not remain under a cloud. I directed ASMS to communicate to its employees with some particularity what their actuals area of responsibility are. I was informed by ASMS management during the proceeding on Monday, 14 November, 2005 that, in fact, many of the ASMS employees were, in fact, already performing the maintenance work on the loader in accordance with the terms of the contract ASMS has with WesTrac. But I still believe that, in everybody's interests, those areas of responsibility should be spelled out in detail so that all employees are in a position to avoid any problems that may arise in the future.

P J CONNOR

Commissioner

LAST UPDATED: 15/11/2005