Construction, Forestry, Mining and Energy Union v Laminex Group Pty Ltd T/A the Laminex Group

[2015] FWC 451

[2015] FWC 451

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

Construction, Forestry, Mining and Energy Union
v
Laminex Group Pty Ltd T/A The Laminex Group
(C2014/5452)

COMMISSIONER BLAIR MELBOURNE, 16 JANUARY 2015

Alleged dispute concerning entitlements.

[1] This is an application by the Construction, Forestry, Mining and Energy Union (the Applicant) pursuant to s.739 of the Fair Work Act 2009 (the Act) in relation to a dispute concerning entitlements. The respondent to the application is Laminex Group Pty Ltd t/a The Laminex Group (the Respondent).

[2] The dispute relates to the application of clause 11.5 in the Laminex Group Ballarat Decorating Plant Agreement 2013 and the Laminex Group Ballarat Componentary Plant Agreement 2013.

[3] The following decision (now edited) was handed down at the conclusion of an arbitration hearing before the Fair Work Commission (the Commission) on 9 December 2014:

[4] The Commission indicated from the outset that it had read the submissions and it had read the witness statements from the Respondent and the Commission has listened very carefully to the submissions made by Mr Sayers on behalf of the Applicant and Mr Pill on behalf of the Respondent.

[5] The Commission would have to say that in considering the argument from the Applicant, if one were to look at the application of clause 11.5 in both the Laminex Group Ballarat Decorating Plant Agreement 2013 and the Laminex Group Ballarat Componentry Plant Agreement 2013 on its own, there is an arguable case that the leading hand’s allowance should apply to level 5 employees. However, one can’t look at that in isolation, one must look at the total history of how all this has come about.

[6] It is clear in the evidence before the Commission, and it has not been able to be contradicted, that in the 1996/1997 EBA negotiations a restructure occurred – those negotiations occurred between the Applicant and the Respondent. That restructure resulted in a new five-level structure as opposed to a four-level structure that existed at the time.

[7] The five-level structure was established to replace the leading hand and foreman positions. They were subsequently compensated to the tune of 117 per cent of the rate for level 4 employees. That structure rate has existed for some 17 years. Even since the 2006 negotiations where there became a reference to schedule 1, that practice has continued to apply.

[8] What it would mean if the Applicant was to succeed is that employees at level 5, performing the functions that would once normally be considered leading hand or formal functions now deemed to be team leader functions, would be paid at 117 per cent of level 4 but would also attract a loading, that is the leading hand’s allowance, for doing the same function. That is, the employee would be paid twice for doing the same function. The term “double dipping” has been mentioned several times in today’s proceedings and that’s exactly what it would be, it would be double dipping. That’s not what the intention of the agreement is and for that to apply would be a misinterpretation of the application of a leading hand’s allowance at 11.5 of both agreements.

[9] In regards to the applications by the Respondent to vary the 11.5 clause of schedule 1 in both agreements to remove ambiguity and uncertainty, the Commission is reminded of a case some many years ago that went before the Industrial Relations Court before Chief Justice Smithers. It was an application against the Nissan Motor Company where the arguments relating to a particular clause in the agreement said that if an employee worked night shift and went into a public holiday the was employee entitled to the public holiday rate. Chief Justice Smithers at the time rejected the application. No one did anything about the wording of the clause.

[10] Approximately 20 years later the same application was made to the full bench of the federal court, this time against the Toyota Motor Company and based on the same wording. The full bench of the federal court came down with a different interpretation to that of Chief Justice Smithers in the previous matter and said that the employees were entitled to the payment.

[11] Subsequently an application was made to a full bench of the Commission to retrospectively alter the wording of the clause in line with Justice Smithers’s decision and such application was granted. The Commission is mindful of the words of then Vice President Ross in Grow Constructors Pty Ltd v. CFMEU where he says, “The Commission will generally err on the side of finding an ambiguity or uncertainty where there are rival contentions advanced and an arguable case is made out for more than one contention.” That is what is happening today and unless something is done to remove that contention then it says to the Commission that at some point in the future again someone may look at the wording of 11.5, that that’s the clause at the time and say on its own those that are level 5 are entitled to be paid the leading hand’s allowance.

[12] Accordingly, the Commission finds that there is ambiguity and most certainly there is uncertainty regarding the application of clause 11.5 in both agreements.

[13] The Commission will vary those two particular clauses in both of those agreements to remove that ambiguity and uncertainty, to make it clear that the leading hand’s allowance does not apply to those employees paid and performing the functions at a level 5.

[14] It therefore follows that the application under s.739 of the Act is dismissed.

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