Australasian Meat Industry Employees Union v Wingham Beef Exports Pty Ltd T/A Wingham Beef Exports

[2012] FWA 7748

Note: An appeal pursuant to s.604 (C2012/6585) was lodged against this decision - refer to Full Bench decision dated 15 February 2013 [[2013] FWCFB 909] for result of appeal.

[2012] FWA 7748

FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.739 - Application to deal with a dispute

Australasian Meat Industry Employees Union
v
Wingham Beef Exports Pty Ltd T/A Wingham Beef Exports
(C2012/2527)

COMMISSIONER MACDONALD SYDNEY, 22 NOVEMBER 2012

Application by the AMIEU to deal with a dispute - s.739 of the Fair Work Act 2009 - enterprise agreement - meat industry - dispute procedure clause - piecework system for remunerating boning room employees - employer advised employees of a change in the performance of a task - impact on piecework remuneration divisor - conference by FWA - workplace inspection by FWA - Hearing - consideration of relevant enterprise agreement clause and incorporated NAPSA clause - consideration of Modern Award provision - HELD: Employer’s decision to alter piecework remuneration divisor pursuant to Modern Award upheld.

[1] The Australasian Meat Industry Employees Union (the AMIEU) filed a Form F10 Application for Fair Work Australia (FWA) to deal with a dispute pursuant to section 739 of the Fair Work Act 2009 (the Act) in accordance with clause 36 Dispute Procedure contained in the Wingham Beef Exports and Australasian Meat Industry Employees Union Enterprise Agreement 2010 (the 2010 Agreement).

[2] The application was filed on 3 February 2010. The Respondent was named as Wingham Beef Exports Pty Ltd t/a Wingham Beef Exports.

[3] The file was set down for a Conference in Newcastle, Wharf Road, on 8 March 2012. The matter did not resolve and subsequently the AMIEU sought that the file be programmed for Arbitration.

[4] On 25 July 2012, I held an inspection of the relevant section of the meat processing work at the Respondent’s work site at Wingham.

[5] On 26 July, the Hearing took place in Newcastle, Wharf Road.

[6] At the Hearing, the AMIEU was represented by Mr C Buckley, National Industrial Officer. The AMIEU’s three witnesses were not required for cross-examination:

Justin Smith - Assistant Secretary, Newcastle and Northern Branch (AMIEU)

Bradley Wells - Boning Room Employee

Jeffrey Wells - Boning Room Employee

[7] At the Hearing, the Respondent was represented by Mr B Howarth, Human Resources Manager, Mr S Rutledge, Plant Manager and Mr G Coleman, General Manager. The Respondent’s two witnesses were not required for cross-examination:

Shane Rutledge - Plant Manager

Grant Coleman - General Manager

BACKGROUND

[8] The Respondent is engaged in the meat processing industry - slaughtering and carving meat from cattle. The carving of meat takes place in the Boning Room.

[9] Within the Boning Room, there are a number of employees with different job classifications. The dispute before FWA concerns three of those classifications: boners, boner separators and slicers.

[10] The Respondent operated a day and afternoon shift but in August 2011, the Respondent abolished the afternoon shift.

[11] In December 2011, the Respondent gave notice of changes to its requirements in the meat processing Boning Room. The Respondent intended to abolish Bone Separator positions and absorb those tasks into the Boner’s duties when production demands required. Notice was also given to establish two additional Boner and Slicer positions during peak workload periods or as otherwise required.

[12] Boners perform the task of carving, slicing sections of meat from the carcass which hangs from an overhead railing. As the carcass is pushed along, more Boners remove more sections of meat. At the end of this meat removal process, the carcass, still hanging from the railing, is then attended to by the Bone Separators who remove the forequarter and hindquarter bones.

[13] Slicers are given/tossed the carved sections of meat for trimming and removing extraneous material.

[14] The Respondent’s decision to abolish the Bone Separator positions and absorb those tasks into the Boners’ duties, impacted the piecework method of remuneration for Boners and Slicers. It would result in less remuneration for Boners and Slicers. The two Bone Separator positions would be abolished and those employees would become part of the Boners team. That would mean an increase in the number of Boners by an additional two workers. Instead of a divisor of say 26 Boners for calculating the piecerate for each Boner and Slicer, the divisor would become say 28 Boners.

[15] The AMIEU was opposed to this change in the piecerate calculation. That is, opposed to including Bone Separators into calculating the piecerate for Boners and Slicers.

FINAL SUBMISSIONS

For the AMIEU

[16] The AMIEU filed written submissions (Ex. 4) and reply submissions (Ex. 5) and spoke to those submissions. The key points of the AMIEU submissions were:

(a) The Respondent had the right to direct Boners to perform the work of Bone Separators.

(b) The AMIEU disputed including the Boner Separation duties (say two workers) into the number of Boners performing Boning duties, for the purpose of calculating the piecerate for each Boner and hence each Slicer.

(c) The work of bone separation was a task that should be classified as a Grade 1 Labourer under the 2010 Agreement.

(d) Under the 2010 Agreement, employees performing labouring tasks (not boning or slicing tasks) are remunerated according to an hourly rate and do not participate in the piecework/incentive system for Boners and Slicers.

(e) Prior to 2012, Boners did not perform Bone Separator tasks. This is supported by the evidence of Wells and Staff who state that over some 20 years of employment the task of bone separation has been performed by labourers (Grade G1).

(f) An interpretation of the 2010 Agreement resulted in the conclusion that the parties did not contemplate the Boner Separator tasks falling within the scope of a Boner’s work.

(g) Resort to extrinsic material for interpretation purposes was not required but if required, then the history showed that it was never contemplated that Boner Separator tasks was work of Boners. Bone separation has always been done by labourers.

(h) The Respondent’s reliance upon the definition of “Boner” found in the Meat Industry Award 2010 is problematic for a number of reasons.

(i) The 2010 Agreement incorporated the terms of the Butchers’ Wholesale (Newcastle and Northern) Award (NAPSA) which was a New South Wales award. The AMIEU relied upon certain clauses in the NAPSA as supporting its view of separating boning tasks from non-boning tasks and avoiding the reduction of the remuneration of boning room employees (Boners and Slicers).

For the Respondent

[17] The Respondent provided written submissions (Ex. 8) and spoke to those submissions. The key points of the Respondent’s submissions were:

(a) Notice was given to employees and the AMIEU per clause 9.2 of the NAPSA (Introduction of Change), to abolish the Bone Separator positions and absorb those tasks into Boners’ duties.

(b) The right to restructure such tasks into Boners’ duties is supported by clause 25.8.1 of the NAPSA and clause 39.4.6 of the 2010 Agreement.

CONSIDERATION

[18] The AMIEU filed a dispute notification pursuant to section 739 of the Act for FWA to conciliate and failing conciliation, arbitrate a matter in dispute between it and the Respondent. The dispute concerned the Respondent’s decision to alter the divisor for the calculation of piece rates for the classification called Boners. The Respondent altered the divisor by including Bone Separators as part of the divisor. Thus, for example, the inclusion of say two (2) Bone Separators into the calculation of piece rates for say twenty-six (26) Boners, then meant a divisor of 28 (instead of 26). A divisor of 28 meant a lesser piece rate (than a divisor of 26) for the Boners.

[19] The relief sought by the AMIEU, in opposition to the inclusion of Bone Separators as part of the divisor, was set out in its Form F10 Application:

“(a) A determination that, under the terms of the enterprise agreement, the forequarter and hindquarter bone separation tasks are not tasks which fall within the boner’s classification;

(b) That boners assigned to performing the work of forequarter and hindquarter bone separation must not be counted as boners for the purpose of determining the appropriate divisor for calculating boning team remuneration under Appendix 2 of the Agreement.”

Relevant Industrial Instruments

[20] An assessment of the dispute necessarily requires a consideration of the three industrial instruments that have application to one degree or another to the Respondent’s operation. There are three (3) industrial instruments:

(a) Wingham Beef Exports and Australasian Meat Industry Employees Union Enterprise Agreement 2010 (the 2010 Agreement);

(b) The Butchers’ Wholesale (Newcastle and Northern Award) [the NAPSA]; and

(c) Meat Industry Award 2010 [the Modern Award].

[21] The parties confirmed during proceedings that the Modern Award was incorrectly named in Clause 5.2 of the 2010 Agreement. Thus, it is incorrectly recorded as the Meat Industry Processing Award 2010. (PN 320-PN 325)

Relationship of Industrial Instruments

[22] Clause 5. Relationship to Award of the 2010 Agreement spells out the relationship amongst the above three named industrial instruments.

[23] Clause 5.1 states that the provisions of the NAPSA are incorporated into the 2010 Agreement.

[24] Clause 5.2 states that where there is any inconsistency between an express provision(s) of the 2010 Agreement and a term of the NAPSA or the Modern Award, then the express provision(s) of the 2010 agreement shall prevail to the extent of any inconsistency.

[25] In considering the dispute between the parties, I take the view that precedence is to be given to a consideration of the 2010 Agreement and the incorporated NAPSA provision(s) before considering the relevance of the Modern Award and its provision.

The 2010 Agreement and the NAPSA

[26] The issue before FWA is whether the Bone Separators are to be included as part of the divisor for calculating the piecework rate for Boners. I now turn my attention to the 2010 Agreement and the NAPSA for what either or both instruments say about bone separation work - that is, whether bone separation is part of or not part of the duties of a Boner. If yes, then the Bone Separators are included in the divisor. If not, the Bone Separators are not included in the divisor.

[27] The 2010 Agreement makes a reference to the classifications of Bone Separator HQ (i.e., Hind Quarters) and Bone Separator Knife FQ (i.e., Fore Quarters) (Clause 11.2.3), but otherwise the 2010 Agreement is silent as to the duties of a Boner.

[28] The NAPSA at Clause 25. Tally Boning deals with tasks to be performed and how Boners will be remunerated if doing “other duties”. This is set out at clause 25.7.2:

”25.7.2 An employer may require a boner to combine tally work and non-tally work. In that event the employee shall, for the purpose of calculating the tally, be counted as a tally worker proportionately to the time which he/she works on tally but, in any circumstance, a permanent boner shall receive the boner’s rate of pay when performing other duties.”

[29] The foregoing extract from the NAPSA shows that:

(a) the employer may require a Boner to combine tally work and non-tally work;

(b) the employee (a Boner) shall be counted as a tally worker proportionately to the time spent on tally work only; and

(c) a permanent Boner shall receive the boner’s rate of pay when performing other duties.

[30] At first glance there seems to be a contradiction between propositions (b) and (c). Thus (b) says that a Boner’s piecework rate of pay is not calculated by taking into account non-tally work. But (c) says that a Permanent Boner shall receive “in any circumstance”, the piecework rate of pay when carrying out “other duties”.

[31] It seems to FWA that the only way that this apparent contradiction can be resolved is by putting the construction on the meaning of “other duties” to be that “other duties” refers to tally work. Thus “other duties” is not “non-tally” work because proposition (c) says that “other duties” does not affect the Boner’s piecework rate of remuneration but proposition (b) says that “non-tally” work does affect the Boner’s piecework rate of pay.

[32] So, it follows from the foregoing, that if bone separation forms part of “tally work” or “other duties”, then bone separation work is to be included in the piecework rate of pay divisor calculation for all Boners. Conversely, if bone separation does not form part of “tally work” or “other duties”, then bone separation work is not to be included in the divisor for calculating the piecework rate of Boners.

[33] As to whether bone separation forms, or does not form, part of “tally work” or “other duties”, the NAPSA is silent. That is so, as there is no definition of a Boner’s duties or of a Bone Separator’s duties.

[34] The term “other duties” is not defined in the 2010 Agreement nor in the NAPSA.

The Modern Award

[35] Given the absence of a definition for a Boner and Bone Separator in the 2010 Agreement and the NAPSA, I now turn to the Modern Award.

[36] Schedule B - Classification Structure sets out a definition of Boner at B.2.1 as follows:

“B.2.1 Boner is an employee who is required to use a knife to remove meat from the bones, sides, quarters or other piece of a carcase [sic] in accordance with the employer’s specifications and, where required by the employer, to dispatch such meat, bones and trimmings to other employees and/or work areas for further processing as required by the employer.” (underlining added)

[37] The foregoing definition of a Boner shows that part of his/her duties includes “... to despatch such ... bones ...”

[38] Mr Howarth, for the Respondent, in final submissions drew attention to the above Modern Award definition of a Boner. He submitted that the 2010 Agreement and the NAPSA did not give a definition of the duties of tally workers as boners. He submitted that Schedule B.2.1 gave a definition of a boner which definition included bone separation tasks. (PN 288 to PN 290)

[39] FWA concurs with the submission of the Respondent and finds that the bone separation work forms part of the Boner’s duties.

[40] In paragraph 19 above, I set out the two issues (relief sought by AMIEU) for my consideration. The first relief sought by the AMIEU was a determination that bone separation tasks are not tasks falling within the Boner’s classification. In assessing that issue, I have considered the relevance of three industrial instruments. Significantly, I found that the 2010 Agreement and the NAPSA gave no definition of a boner’s duties or bone separation work. I then turned to the Modern Award which does provide a definition of a Boner and that definition included dispatching of bones. The Respondent submitted, and I accept, that dispatching of bones is bone separation duties. Accordingly, I decline to grant the determination sought by the AMIEU as the 2010 Agreement does not say that bone separation duties do not fall within the duties of a Boner.

[41] The second issue (relief sought by the AMIEU) is that bone separation duties are not be factored into the divisor for calculating a Boner’s piecework rate of pay.

[42] Given that I have found that bone separation duties fall within the definition of a Boner, then I decline to grant the determination sought by the AMIEU. Thus, when Boners are carrying out the work of bone separation, then that task forms part of the divisor for calculating the piecework rate of Boners.

CONCLUSION

[43] The AMIEU lodged a dispute notification following the Respondent’s decision to abolish the Bone Separator positions and absorb those tasks into the Boner’s duties. This impacted the piecework rate for Boners. That is, the piecework rate remuneration for Boners was reduced.

[44] The Respondent held that it was entitled to direct Boners to perform the work of bone separation. The AMIEU’s Outline of Submissions did not dispute that the employer had the right to direct Boners to perform the bone separation work. (Ex. 4, para 2)

[45] Both parties drew upon the above named industrial instruments to support their respective positions. The AMIEU also relied upon the evidence of witnesses as to custom and practice: that is, Boners did not carry out the task of bone separation.

[46] Having considered all of the evidence and submissions, and for the reasoning set out above, I have found that Schedule B.2.1 of the Modern Award allows the employer to submit that bone separation is part of a Boner’s duties and accordingly bone separation is to be carried out by Boners, even though in doing so, it has an adverse impact on the method of calculating the Boner’s piecework rate of pay.

[47] There is no inconsistency between that Schedule B.2.1 provision and any provision contained in the 2010 Agreement and the NAPSA.

[48] Accordingly, I decline to grant the relief sought by the AMIEU and the file is closed.

COMMISSIONER

Appearances:

Mr C Buckley, Australasian Meat Industry Employees Union

Mr B Howarth, Wingham Beef Exports

Hearing details:

2012

Newcastle

July 26

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