Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia and the Australian Manufacturing Workers' Union v BlueScope Steel (AIS) Port Kembla

[2015] FWC 6512

[2015] FWC 6512

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

The Australian Workers’ Union; Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia and the Australian Manufacturing Workers’ Union
v
BlueScope Steel (AIS) Port Kembla
(C2014/5556; C2014/1256; C2014/5383)

COMMISSIONER RIORDAN SYDNEY, 24 SEPTEMBER 2015

Further decision.

[1] A Full Bench of the Fair Work Commission (FWC) 1 has determined that BlueScope Steel (AIS) Pty Ltd (BlueScope) Trade Operator Model proposal is legal within the test in clause 35.2 of the BlueScope Steel Port Kembla Steelworks Agreement 2012 (the Agreement). The remaining issues are whether the proposals are safe, efficient or fair. The Full Bench remitted these issues back to me for determination.

[2] I invited the parties to make further submissions. BlueScope provided a brief submission on the outstanding issues on 9 September 2015. The Unions (The Australian Workers Union, Port Kembla Branch, The Australian Manufacturing Workers Union and the Communications Electrical and Plumbing Union) did not provide any additional submissions.

[3] On 24 August 2015, BlueScope announced to the Australian Stock Exchange that it had to either make operational savings of $200 million per annum or close down its steelmaking operation. I have taken this into account.

[4] Due to the need for expediency I have not summarised the detailed submissions or evidence of the parties. However, I have taken all of the submissions and evidence into account in my consideration.

Determination - Safety

[5] Whilst sympathetic to the Union’s argument in relation to the possibility of fatigue in tradespersons, who have to switch from repetitive production activities to highly complex maintenance functions, I am not persuaded that this argument warrants the frustration of BlueScope’s proposal. In the short term, it is possible that BlueScope may have a reduced capacity to introduce “disciplinary processes” against individual Trade Operators due to minor safety or operational mistakes. These will be inevitable.

[6] I do not accept the Union’s proposition that there will be a delay in having a Trade Operator attend a breakdown due to their operating location on the plan, or that it may introduce an insurmountable safety hazard. Few breakdowns cause emergency situations. When they do, the current situation is that the Maintenance Tradespersons could be anywhere on the plant. Nothing will be changed as a result of BlueScope’s proposal. Such a scenario does not make the proposal unsafe.

[7] BlueScope is aware of its obligations under the Work, Health and Safety Act, 2011. BlueScope has a very safety conscious management team. I am satisfied that the Trade Operator Model proposal satisfies the safety test requirements of the Agreement.

Determination - Efficiency

[8] There are obvious efficiency benefits associated with the introduction of the Trade Operator Model. One of these is that a number of Operator positions will be made redundant, which will provide real and on-going cost savings to BlueScope.

[9] However, on the downside, BlueScope will gradually lose the specialised skills of its tradespersons. As a qualified and licensed electrician, I know first-hand what happens to a tradesperson’s skills if they decrease their “hands on” work at their trade. This concept is at odds with the focus and purpose of the Greater Trades Model. I accept the proposition put forward by the Union that this will eventually reduce the efficiency of the maintenance trades.

[10] In reaching their decision to proceed with the Trade Operator Model proposal, BlueScope would had to have considered this reduction in efficiency as a result of the inevitable deskilling of their maintenance trades. This is a factor that BlueScope will have to incorporate into its operations when dealing with tradespersons who are performing operator roles and therefore spending less time on their trade work.

[11] The Unions have not provided any evidence in support of their arguments but simply rely on logical conclusions concerning deskilling. However, in an environment of cost reduction necessity, I am satisfied that the Trade Operator Model is efficient, at least in the short term.

Determination-Fairness

[12] The concept of fairness is obviously quite complex given the competing interests of the parties. There is an obvious unfairness in the Trade Operator Model for those Operators who will be made redundant and for those Tradespersons who will be forced to learn a new skill and competency, and who will be obliged to perform work other than their trade with possible deskilling. Alternatively, it would be unfair to BlueScope, and its employees as a whole, to deny it the opportunity to make changes which will provide cost savings to the production process and hopefully maintain the economic viability of the Steelworks.

[13] Prior to the commencement of the hearing, I asked the parties to seek instructions in relation to the training of apprentices on the basis that operating machinery is not a component of either the electro technology or mechanical apprenticeships. Mr Darams provided the following undertaking:

“The Company puts this forward: no worker who is conducting their apprenticeship will be required to do any work under this proposal. By that, they will not be trained – any of the training that might have to be provided for a tradesman to operate any particular machinery, they will not be provided with that training whilst they are doing their apprenticeship. The consequence of that is that it will only be trades who have fully completed their apprenticeship training who will be subject to these proposals.” 2

(my emphasis)

[14] Currently, tradespersons are performing operating tasks throughout the plant which are incidental and peripheral to their core maintenance functions, i.e., in order to undertake fault finding analysis, to test the effectiveness of their maintenance/repair task, or to commission a new installation

[15] For a tradesperson to perform the operating functions now contemplated by BlueScope, additional training will be required. Mr Otsyula, the Plate Processing and Dispatch Manager, advised:

“The training will be the same training that the existing operators undertake before being able to undertake the tasks.” 3

(my emphasis)

[16] Essentially a Tradesperson is being trained to be an Operator. As I said in my decision at first instance, the concept of Trade Operator or Operator Maintainer is not a new phenomenon in the Australian industrial landscape. The Operator Maintainer classification was introduced at ICI Port Botany some twenty years ago. In that situation, a new classification stream was introduced for tradespersons who undertook the Operator training and performed the Operator/Maintainer role. This process resulted in a work value case being conducted by the Australian Industrial Relations Commission and a consequent endorsement of the proposed classifications and new rates of pay.

[17] BlueScope does not propose to provide any additional remuneration under this proposal. As a result, the proposition may be unfair. I cannot see any industrial justification for a tradesperson to undertake additional training and utilise competencies from another stream in the Australian Qualification Framework standards and the associated training packages for no additional remuneration. Such a proposition is illogical and is inconsistent with numerous decisions of the Fair Work Commission and its predecessors in relation to issues such as cross-skilling and increased competency.

[18] It is evident that the proposal is far wider than the concept of “incidental and peripheral”, with tradespersons possibly being required to spend 50% of their working hours performing operational duties. No sensible definition of incidental or peripheral could contemplate such an outcome.

[19] Under normal circumstances, I would recommend a three month trial to “test” whether the proposed work map is onerous or inefficient. It would also allow for an assessment of the productivity improvement and the skills/competencies required to perform the Trade Operator role.

[20] I would also require evidence to be sourced from ICI in relation to their experience with the classification of Operator Maintainer. I would want to consider the benefits, the challenges and the pitfalls of this classification over the last 20 years.

[21] However, due to the obvious need to find urgent cost savings, I am not prepared to delay the introduction of the Trade Operator Model to gather this evidence. To do so would be unfair to BlueScope.

[22] On balance I am satisfied that the Trade Operator Model proposal is fair.

Conclusion

[23] I have decided that the proposed Trade Operator Model can be introduced immediately on the understanding that a review will be undertaken by the FWC in relation to the operation of the new classification and rate of pay in April 2016.

[24] The two most recent interpretations of the Agreement have resulted in it being interpreted in a narrow manner.

[25] I encourage the parties in the current enterprise bargaining agreement negotiations to more accurately express their intentions into any new agreement. It may not be appropriate to have an operative clause that deals with restructuring and the introduction of change to be subservient to another provision in the agreement. It is also inappropriate for an organisation the size of BlueScope to not have a classification structure in the agreement. Failure to include such a clause has the capacity to create an industrial minefield of disputation in the future.

COMMISSIONER

 1   [2015] FWCFB 5615

 2   Transcript 4 February 2015 – PN3

 3   Exhibit B4 – PN53

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