Ergon Energy Corporation Limited v Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia

[2014] FWC 1192

[2014] FWC 1192

The attached document replaces the document previously issued with the above code on 18 February 2014.

The attached document is amended to include Appendix A.

Annalise Wood

Associate to Commissioner Lewin

Dated 19 February 2014.

[2014] FWC 1192

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

Ergon Energy Corporation Limited
v
Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia; Queensland Services, Industrial Union of Employees; “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU); Association of Professional Engineers, Scientists and Managers, Australia, The; Australian Municipal, Administrative, Clerical and Services Union
(C2013/5570)

COMMISSIONER LEWIN MELBOURNE, 17 FEBRUARY 2014

Alleged dispute regarding fortnightly work arrangements - enterprise Agreement - alleged dispute regarding fortnightly working arrangements - reversion of employees declared redundant from 10 day to nine day fortnight - employees seeking redeployment in accordance with the terms of the Enterprise Agreement - right to continue to receive amounts for working of 10 day fortnight during redundancy and redeployment situation - proper application of terms of the Agreement.

Introduction

[1] This Decision concerns a dispute between Ergon Energy Corporation Limited (Ergon) and employees of Ergon represented by the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia; Queensland Services, Industrial Union of Employees; “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU); Association of Professional Engineers, Scientists and Managers, Australia, The; Australian Municipal, Administrative, Clerical and Services Union (ASU).

[2] The dispute concerns the proper application of terms of the Ergon Energy Union Collective Agreement 2011 (the Agreement).

[3] Ergon is a large electricity supplier in Queensland. Ergon’s website states that Ergon services around 700,000 customers, has around 5,000 employees and a 10.6 billion dollar asset base.

The Agreement

[4] The Agreement was approved by Fair Work Australia on 15 March 2012. 1 The nominal expiry date of the Agreement is 1 October 2014 or until such time as it is replaced or terminated in accordance with the Act.2

[5] The Agreement provides that all grievances or disputes in respect of its terms are to be dealt with under the terms of Clause 2.1 Grievance and Dispute Settlement Procedure thereof.

[6] Clause 2.1 of the Agreement is set out below:

2.1 GRIEVANCE AND DISPUTE SETTLEMENT PROCEDURE

General

2.1.1 The matters to be dealt with in this procedure include all grievances or disputes between an employee(s) and Ergon Energy in respect to this Agreement, the National Employment Standards and any other employment matters. This also includes any disputes relating to contested position appointments or issues relating to the composition of the workforce. This procedure applies to a single employee or to any number of employees.

2.1.2 Whilst the procedure in this Clause is being followed, normal work will continue except in the case of a genuine safety issue directly affecting the performance of the work.

2.1.3 The status quo will be maintained whilst the procedure in this Clause is being followed. In this Clause, status quo means the circumstances that prevailed immediately prior to the disputed issue being notified.

2.1.4 Discussions at any stage of the procedure shall not be unreasonably delayed by any party, subject to acceptance that some matters may be of such complexity or importance that it may take a reasonable period of time for the appropriate response to be made. If genuine discussions are unreasonably delayed or hindered, it will be open to any party to the dispute to give notification of a dispute to the Fair Work Australia 2009.

Internal Resolution Process

2.1.5 In the event of an employee having a grievance or dispute the employee will in the first instance attempt to resolve the matter with the immediate supervisor, who will respond to such request as soon as reasonably practicable under the circumstances. Where the dispute concerns alleged actions of the immediate supervisor the employee/s may bypass this level in the procedure.

2.1.6 If the grievance or dispute is not resolved under Clause 2.1.5 the employee or, if the employee so chooses, the employee’s nominated employee representative may refer the matter to the next higher level of management for discussion. Such discussion should, if possible, take place within twenty (24) hours after the request by the employee or the employee’s nominated employee representative.

2.1.7 If the grievance involves allegations of unlawful discrimination by a supervisor the employee may commence the grievance resolution process by reporting the allegations to the next level of management beyond that of the supervisor concerned. If there is no level of management beyond that involved in the allegation the employee may proceed directly to the process outlined at Clause 2.1.9.

2.1.8 If the grievance or dispute is still unresolved after discussions mentioned in Clause 2.1.5 and 2.1.6, the matter will be reported to the relevant Ergon Energy senior management. This should occur as soon as it is evident that discussions under Clause 2.1.5 and 2.1.6 will not likely result in resolution of the dispute.

Referral to Fair Work Australia

2.1.9 If the grievance or dispute remains unresolved after the parties to the dispute have genuinely attempted to reach a resolution in accordance with Clauses

2.1.5 to 2.1.8, either party to the dispute may refer the grievance or dispute to Fair Work Australia (FWA) under the Act for resolution.

2.1.10 In conducting the dispute resolution process Fair Work Australia is empowered to take such action as is appropriate to assist the parties to resolve the matter.

2.1.11 Fair Work Australia must, as far as is practicable, act:

a. Without delay;

b. In a way that avoids unnecessary technicalities and legal forms; and c. In accordance with this Agreement.

2.1.12 Each party to this dispute resolution process commits to require/and or direct the attendance of any person or persons in their respective employ at any proceeding that Fair Work Australia may convene if Fair Work Australia considers that person or persons would be of assistance in the determination of the industrial dispute. Failure to honour such commitment may be taken into account by Fair Work Australia in arbitrating the dispute.

2.1.13 Each party to this dispute resolution process commits to produce to Fair Work Australia any documents, books, records or other items not subject to legal professional privilege as Fair Work Australia may require, to assist it to conciliate and/or arbitrate an industrial dispute. Failure to honour such commitment may be taken into account by Fair Work Australia in arbitrating the dispute.

2.1.14 The parties to this dispute resolution process may be represented by an agent appointed in writing.

2.1.15 During the process of conciliation Fair Work Australia may only permit a party to the dispute or person to be represented by a lawyer, if and only if, all parties to the grievance or dispute consent. However, during arbitration and/or the appeal process either party may seek leave from Fair Work Australia to be legally represented. In considering the granting of such leave Fair Work Australia must be satisfied of the benefits of having legal representation, having regard to the matter the proceedings relate to, that there are special circumstances that make it desirable for the party to the dispute to be legally represented and that the party to the dispute can only be adequately represented by a lawyer.

2.1.16 Where the parties to a dispute are unable to reach agreement, Fair Work Australia may make recommendation/s about the issue/s in dispute.

2.1.17 Within three (3) working days of Fair Work Australia making such recommendation/s, the parties to the dispute are to inform Fair Work Australia whether or not they intend to comply with the recommendation/s.

2.1.18 Where either party to the dispute has either failed to inform Fair Work Australia that they intend to comply with the recommendation/s within three working days or has advised Fair Work Australia that they do not intend to comply with the recommendation/s Fair Work Australia will at the request of either party to the dispute list the matter for arbitration.

Arbitration by Fair Work Australia

2.1.19 In the event the matter is not resolved through conciliation and proceeds to arbitration either party to the dispute may request another member of Fair Work Australia to arbitrate and hand down a binding decision. In arbitrating the matter Fair Work Australia will give the parties an opportunity to be heard formally on the matter(s) in dispute.

2.1.20 In making its decision Fair Work Australia:

a. will have regard to the materials, including witness evidence, and submissions put before it at the hearing and will disregard any admissions, concessions, offers or claims made in conciliation or mediation;

b. will be governed in its decisions by equity, good conscience and the substantial merits of the case;

c. will not be bound by technicalities, legal forms or rules of evidence; and

d. may inform itself on any matter it considers appropriate to resolve the grievance or dispute.

2.1.21 After the hearing, Fair Work Australia will provide the decision in writing to the parties to the dispute as quickly as practicable.

Appeal following Arbitration

2.1.22 Where either party to the dispute is dissatisfied with a decision of Fair Work Australia they may appeal the decision on a question of law to the Full Bench of Fair Work Australia.

2.1.23 The appeal will be subject to any applicable procedures of Fair Work Australia.

2.1.24 An appeal against a decision must be commenced within twenty one (21) days after:

a. If the decision is given at a hearing - the announcement of the decision at the hearing; or

b. If the decision is given through the registrar - the release of the decision.

Fair Work Australia is not to permit any extensions to the twenty one (21) day time limit.

2.1.25 An appeal is by way of rehearing on the record. However, Fair Work Australia may hear evidence afresh, or hear additional evidence, if it considers it appropriate to effectively dispose of the appeal.

2.1.26 The Full Bench may:

a. Dismiss the appeal; or

b. Allow the appeal, set aside the decision and substitute another decision; or

c. Allow the appeal and amend the decision; or

d. Allow the appeal, suspend the operation of the decision and remit the grievance or dispute, with or without directions, to Fair Work Australia,

(i) For report to the Full Bench; or

(ii) To act according to law.

Costs

2.1.27 Each party to the dispute will, at each stage of the procedure outlined in this Clause, bear its own costs.

The Proceedings

[7] The dispute was unable to be resolved by the Internal Resolution Process prescribed between Clause 2.1.5 and Clause 2.1.8 of Clause 2.1 of the Agreement and was referred to the Commission on 15 August 2013 by Ergon.

[8] Ergon made an application under s739 of the Fair Work Act 2009 (the Act).The subject matter of the dispute was described by Ergon as the “reversion”, of a number of employees (who had previously been notified that the positions they were working in were redundant and consequently are currently seeking redeployment, in accordance with the terms of the Agreement) from a roster of work over a ten day fortnight to a nine day fortnight.

[9] The dispute was dealt with by Deputy President Asbury on 15 August 2013 by Conference and a Hearing on 27 August 2013, which resulted in a Recommendation, on 30 October 2013, which will be further referred to below.

Ten Day Fortnight

[10] Clause 8 of the Agreement regulates the “HOURS OF WORK” of employees whose employment is covered by the Agreement. Hours of work may be variously arranged under Clause 8 and the relevant terms provide for a NINE DAY FORTNIGHT, an EIGHT DAY FORTNIGHT arrangement for employees in Ergon’s National Contact Centre, and a TEN (10) DAY ALTERNATIVE EMPLOYMENT ARRANGEMENTS (ten day fortnight). The latter is governed by Clause 8.7 of the Agreement. At Clause 8.7.3 the provisions governing reversion from such alternative employment arrangements to “General Agreement Provisions” appear.

(all above emphasis in original)

[11] The provisions of Clause 8.7.3 and Clause 8.7.4 are set out below:

8.7.3 Reversion to General Agreement Provisions

Employees working the above arrangements may elect to revert to a nine (9) day fortnight by providing Ergon Energy with one (1) month’s written notice.

It is recognised that individuals may make additional personal financial commitments whilst under these arrangements and as such, where Ergon Energy requires an individual to revert, it will not do so without first providing the employee three (3) months written notice of Ergon Energy’s intention.

If during the three (3) month notice period the employee receives notice of redundancy or advises Ergon Energy that they intend to retire no later than twelve (12) months after the initiated three (3) month notice, the employee will not be required to revert.

8.7.4 Appointment of Ten (10) Day Fortnight

Notwithstanding the above arrangements which are made on a mutually agreed basis, the following may be advertised and awarded on a ten (10) day fortnight basis at the discretion of Ergon Energy:

● New and vacant positions classified in the Administrative Stream from Salary Point 11.0 and above.

● Vacant positions classified in the Administrative Stream which are below salary point 11.0 and are listed in Schedule 7 of this Agreement.

● The positions details reflected in this Schedule are correct as at the date of lodgement of this Agreement.

● The Parties agree that the position identification numbers can be reviewed through the life of this Agreement to ensure that position numbers accurately reflect the identified positions. This will be subject to consultation and agreement between the Parties, provided that agreement will not be unreasonably withheld.

● New and vacant positions classified in the Professional & Managerial stream from P&M Grade one (1) Salary Point 11 and above and where the position supervises, coordinates and schedules other employees.

Employees who accept the above arrangement and who have been working a minimum of three (3) months in the position may elect to revert to a nine (9) day fortnight by providing Ergon Energy one (1) month written notice.

[12] The whole of Clause 8 of the Agreement is Appendix A to this Decision.

[13] Depending on an employee’s salary point under the Agreement, loadings and allowances of differing amounts are variously prescribed for employees working according to the ten day fortnight provisions, as provided for by the terms of Clause 8.7.1 and Clause 8.7.2 of the Agreement. Those loadings amount to between 13% and 22.5% of an employee’s “base rate” as defined, depending upon the classification of an employee. Such amounts are referred to as “all purpose loadings” and are subject to the following terms among others:

The above all purpose loadings shall be used when calculating an employee’s payment for overtime, annual leave, Long Service Leave, parental leave, superannuation, severance and retrenchment payments. 3

[14] Mr Montgomery, who represented Ergon, at the hearing before me, advised that there are 68 employees whose circumstances will be affected by the determination of the dispute. The Commission was advised that the relevant employees are not allocated positions or duties and are fully engaged in the redeployment process provided for by the Agreement, consequent upon the redundancy of the positions in which they were working.

Characterisation of the dispute

[15] Since the original application was made, the characterisation of the dispute has been elaborated in proceedings before the Commission, which will be explained in more detail further below, once the procedural history of the matter is related.

[16] In broad terms the scope of the dispute extends to entitlements of employees who have been advised of the redundancy of the position in which they were working and who were working a ten day fortnight at that time and who have been given three months notice of “reversion” to a nine day fortnight. In essence, the dispute involves whether such employees are entitled to continue to receive amounts which are payable in respect of the working of a ten day fortnight, while seeking redeployment under the terms of the Agreement due to the redundancy of the position in which they had been working. It is notable that if redeployment is unsuccessful such employees would become subject to the voluntary retrenchment provisions of the Agreement. 4

[17] Ergon has referred to the employees concerned as “Employees in Transition” (EIT’s).

[18] To enable an understanding of the context in which the dispute arises, it is useful to make some observations about the relevant circumstances of the employees and the overall framework of various terms of the Agreement which apply to the circumstances of those employees before turning to the particulars of the dispute.

Relevant Terms of the Agreement - Context

[19] The Agreement between Ergon and its employees is very comprehensive in its terms. It is therefore appropriate to look more widely at the terms of the Agreement than just the provisions of Clause 8 of the Agreement. This is because the redundancy of the positions in which the employees affected is relevant to the different constructions placed upon the terms of the Agreement by the Organisations and Ergon, arising from the contention of the Organisations that the redundancy situation essentially determines the outcome of the dispute.

[20] Clause 1 of the Agreement contains numerous generic provisions which establish basic elements of the operation of the terms of the Agreement. Of particular note, for reasons which will become apparent, are the following clauses; Clause 1 contains a DEFINITIONS Clause 1.6, an EMPLOYMENT SECURITY Clause 1.10, and a SALARY MAINTENANCE Clause 1.11.

[21] The provisions of those Clauses of the Agreement are set out below respectively:

1.6 DEFINITIONS

In order to ensure clarity in the intent of this Agreement, a list of definitions for terms utilised in this Agreement is set out below, where they are used throughout the Agreement they will appear in italics:

Act means the Fair Work Act 2009.

Allowance means an amount paid to employees in addition to the employee’s rate of pay, other than an all purpose allowance.

All Purpose Allowance means an allowance that is added into the employee’s base rate of pay as prescribed in Schedule 1 - Ergon Energy Salary Schedule as applicable for the calculation of payments for Overtime, Personal Leave, Annual Leave, Long Service Leave, Completion of Term Payment, Superannuation and Retrenchment Payments unless otherwise stated.

Base Rates means the rate of pay as specified in Schedule 1 of this Agreement.

Consultation means the timely exchange of relevant information and ideas in such a manner that the Parties have the actual and genuine opportunity to influence the outcome.

Nominated Employee Representative means a person/agent or employee (other than a legal representative) nominated employee representative or elected by the employee/s to act on their behalf. This can include nominated employee representative union delegates.

Ergon Energy means Ergon Energy Corporation Limited.

Fixed Term means a specified period of time clearly identified by the term of the employment contract where the time of commencement and the time of completion are detailed.

Mutual Agreement means an Agreement, which has been arrived at between directly affected employees and relevant management without duress being applied to either party.

Short Term Shift Arrangement means a shift covering any duration of a minimum of five (5)

days up to and including eight (8) weeks Monday to Friday only.

Specified Task means employment for a specific project, task or undertaking, and for which the employment contract will specify the circumstances, event, or criteria on which the employment will terminate.

1.10 EMPLOYMENT SECURITY

There will be no forced retrenchments for the life of the Agreement. The agreement to have no forced redundancies depends upon the employee accepting reasonable retraining and redeployment to suitable alternative employment within their current locality to the extent that would not require a move of residence or travel further than fifty (50) kilometre radius of their original work location.

1.11 SALARY MAINTENANCE

An employee whose position is made redundant during the life of this Agreement and is redeployed into a suitable alternative position will have their salary maintained without reduction, including future Agreement increases.

Where an employee is redeployed, their salary for superannuation purposes will exclude shift Allowances unless applicable to the new position with the exception of an employee on aggregated salary arrangements who will maintain their aggregated salary.

If, following notice of their position being made redundant and prior to being redeployed, an employee is successful in attaining another position through a recruitment and selection process their salary will be maintained without reduction including future Agreement increases.

If, following redeployment, an employee is successful in attaining another position through a recruitment and selection process the salary, terms and conditions of their new position will

apply.

[22] Schedule 3 of the Agreement deals with Redundancy Provisions and contains the following:

SCHEDULE 3: REDUNDANCY PROVISIONS

1. APPLICATION

Subject to the following terms and conditions, this Schedule will apply to all employees of Ergon Energy, who are employed on the following basis:

● Full time; or

● Part time

2. EXCLUSIONS

The provisions of this Schedule will not apply to an employee who:

● Is engaged on a Fixed Term or Specified Task arrangement;

● Is an apprentice or a trainee under a traineeship;

● Does not have one year’s continuous service;

● Unreasonably refuses an offer of suitable alternative employment within a fifty kilometre (50km) radius of their original work location;

● Terminates employment during the period of notice given under this Schedule, without

● Ergon Energy’s prior approval, unless the approval is unreasonably withheld;

● Is terminated for neglect of duty or serious misconduct warranting summary dismissal;

● Is specifically excluded by any section of this Schedule.

3. OBJECTIVES

The objectives of this Schedule are to:

● Provide sufficient flexibility to effectively address workforce issues arising from the rationalisation of operations and services from time to time within Ergon Energy, the changing nature of work and/or the rapidly changing environment within which Ergon Energy operates.

● Address these issues in an equitable fashion that supports Ergon Energy meeting the shareholders and the public’s expectations for long term sustainable returns on their investments in this business.

● Maintain employees in employment within Ergon Energy wherever possible.

● Give preference to redeployment and Voluntary Retrenchment where appropriate.

● Provide financial assistance to employees who accept transfers to other locations within Ergon Energy.

● Pay monetary compensation to employees for whom suitable alternative employment cannot be found and whose employment is to be terminated.

● Ensure that the process outlined in this Schedule does not discriminate on the basis of sex,sexual preference, marital status, pregnancy, family responsibilities, age, race, colour, national origin, impairment, trade union activity, political conviction or on any other ground outlined by all and any relevant legislation.

4. DEFINITIONS

“Redundancy” occurs when Ergon Energy identifies that the need for work of a particular kind has substantially diminished or ceased.

For the purpose of this definition redundancy may occur where changed circumstances or work practices affecting the efficient and economical working of the enterprise will normally highlight where redundancies will occur. Employees will be considered for retrenchment / redeployment on the basis of merit, equity, skills, competencies and length of service where a position is declared redundant.

● “Base rate of Pay” The Base rate of pay for the purposes of this Schedule will include (if applicable):

● Rates as determined in the Salary Schedule of this Agreement;

● Allowances for skills on a weekly basis;

● Substation and Test Allowance on a weekly basis;

● Locality Allowance on a weekly basis;

● Any other All purpose Allowance; and

● Annualised rate including applicable loadings for employees on Alternative Employment

● Arrangements including Individual Employment Arrangements (IEA’s) and Aggregated

● Arrangements applicable to System Operators.

For employees not on annualised or aggregated rates, the Base rate of pay excludes overtime, shift loadings and weekend penalty rates.

5. LENGTH OF SERVICE

The completed years of service is calculated by determining the period between the employee’s industry start date (as recognised by Ergon Energy) and the employee’s termination date.

If an employee is working, or has worked a period of part time employment, that employee’s length of service will be calculated to recognise the actual hours of part time employment.

6. CONSULTATION

Where it appears that a position or positions are likely to become redundant, and prior to formal redundancy notices being issued to affected employee/s, Ergon Energy will provide all relevant details to the relevant Nominated Employee Representative/s at the earliest possible time. These details will include:

● The reasons for the position or positions becoming redundant; and

● The number, location and other details of the redundant positions.

● Ergon Energy will arrange discussions to take place with the relevant Nominated Employee Representative/s, which will include:

● The method of identifying positions as redundant, having regard to the efficient and

● economical working of Ergon Energy;

● Advice and the timing of that advice to the employees;

● The appropriateness of using voluntary retrenchment; and

● Redeployment options.

7. PERIOD OF NOTICE

An employee will receive formal written notification where their position is identified as redundant at least six (6) months prior to the event occurring. Notification will also be given to the relevant Nominated Employee Representative. During that time Ergon Energy will take all reasonable steps to determine what other suitable alternative employment exists within Ergon Energy that are suitable for redeployment, and that enable the organisation to best utilise the skills of the employee. Redeployment may take the form of permanent, temporary, or project work.

8. EARLY SEPARATION INCENTIVE PAYMENT (ESIP)

Employees will have the option to apply for an ESIP which is designed to enable employees to elect to leave the service of Ergon Energy. Employees who express interest in participating in the ESIP scheme will be required to submit an application within fourteen (14) calendar days upon receipt of Ergon Energy’s formal written notification of redundancies. Approval of ESIP is at the discretion of Ergon Energy. Some applications may have to be refused or delayed by Ergon Energy if acceptance would be detrimental to its operations. To remain eligible for ESIP,

employees must terminate their employment within fourteen (14) calendar days (unless a longer period is agreed at the discretion of Ergon Energy) upon receipt of approval of their ESIP application. ESIP consists of thirteen (13) weeks incentive payment in addition to all other payments that may comprise a retrenchment package. This incentive payment will be calculated at the Base rate of pay as defined in this Schedule.

9. VOLUNTARY RETRENCHMENT

The purpose of this section is to enable eligible employees to apply for voluntary retrenchment. Employees whose offer of voluntary retrenchment is accepted will be entitled to receive all eligible retrenchment benefits upon termination in accordance with this Agreement. The call for voluntary retrenchments may be made after the need for work of a particular kind has substantially diminished or ceased.

Ergon Energy will provide the relevant Nominated Employee Representatives notification on a monthly basis, of the number of voluntary redundancies, region and classification, post the event.

10. REDEPLOYMENT

Following the consultative steps detailed in Clause 6 of this Schedule, all efforts will be made to find suitable alternative employment for employees whose positions are declared redundant. Each affected employee will be individually interviewed to determine what options may exist for the management of that employee’s future.

Where an employee is redeployed they will retain their Base rate of pay prior to redeployment as a minimum. This will not include shift loadings unless applicable to the redeployed position.

Where applicable, payment of redeployment expenses will be in accordance with Ergon

Energy’s Relocation Policy applying at the time.

Redeployed employees will be eligible for retrenchment benefits if it is found within three (3)

months by either themselves or Ergon Energy, that the alternative position is unsatisfactory.

11. RETRENCHMENT BENEFITS

An employee who is retrenched will be entitled to the following:

● An Ex-gratia Retrenchment Payment of three (3) weeks (with a minimum payment of four (4) weeks) at the Base rate of pay per year of service, together with a proportionate amount for an incomplete year of service. The minimum and maximum retrenchment payment will be three (3) weeks and seventy five (75) weeks respectively. If an employee is working, or has worked a period of part time employment or job share arrangement, the Retrenchment Payment will be calculated on a pro-rata basis to include the period of part time employment or job share arrangement.

● An Early Separation Incentive Payment (ESIP) of thirteen (13) weeks will be paid where applicable.

● An Annual Leave Payment for annual leave includes an employee’s accumulated balance as well as the pro-rata balance. Pro-rata annual leave is paid to the date of termination.

● A Long Service Leave Payment of 1.3 weeks of Base rate of pay for each completed year of service will be made. Pro-rata Long Service Leave will be paid for an incomplete year of service up to the date of termination. Any Long Service Leave already taken will be deducted.

● Any approved and documented Time off in Lieu (TOIL) balances will be paid out at the Base rate applicable at the date of termination.

● An Income Protection Insurance Policy that covers loss of earnings due to illness in the twelve (12) months immediately following retrenchment. This policy will be subject to market accessibility and in accordance with the terms outlined in the Income Protection Insurance Policy. This policy will be limited to a period of one (1) year.

12. GENERAL

A Retrenchment Benefit is compensation for loss of job tenure and it is not a resignation benefit. The relevant manager may approve leave with pay for affected employees to attend personal employment interviews.

Each affected employee will be provided with a statement showing the calculation of an estimate of the Retrenchment Payment prior to retrenchment.

Assistance will be given for employees to access relevant support providers who may include financial advisers, employee assistance counsellors, outplacement services and access to agreed training providers. Reasonable expenses associated with these services may be reimbursed by Ergon Energy.

[23] It is convenient to note precisely that the basis upon which the Organisations contend that the application of the provisions of the Agreement require that certain employees retain an entitlement to be paid the amounts prescribed by the Agreement for the working of a 10 day fortnight (although having been subject to “reversion” to a nine day fortnight by effective notice initiated by Ergon, under Clause 8.7.3 of the Agreement) is that such employees are working in positions which Ergon has identified as redundant and has notified those employees thereof, in accordance with Schedule 3 of the Agreement.

[24] It is not submitted on behalf of the Organisations that any other employee working a ten day fortnight, who is given effective notice of reversion to a nine day fortnight in accordance with the terms of the Agreement by Ergon, would retain an entitlement to receive the amounts payable for working a ten day fortnight on such reversion, except for the three month period prescribed by Clause 8.7.3.

Initial Consideration of the Dispute - Commission Recommendation

[25] The dispute was dealt with by Deputy President Asbury at Brisbane on 15 August 2013 by way of Conference and 27 August 2013 by way of Hearing. The parties to the dispute were unable to reach agreement. On 30 October 2013, the Deputy President issued a Recommendation in relation to the dispute, pursuant to Clause 2.1.16 of the Agreement. The Recommendation was in two parts. Ergon subsequently advised that it did not intend to comply with the Recommendation.

[26] The Deputy President characterised the dispute in the course of the Recommendation as follows:

[9] The issues in dispute as identified by the parties are the right of Ergon to require EITs to revert to a 9 day fortnight and whether EITs who are required to revert continue to be entitled to the 10 day fortnight loading, by virtue of the salary maintenance provisions of the Agreement.

[27] At the Conclusion of the Recommendation of 30 October 2013, the Deputy President recommended as follows:

• The Unions accept that Ergon has the right to give EITs 3 months notice of the requirement to revert to a 9 day fortnight, and that the notice given to employees on 13 August 2013 is effective.




[28] Since that time the Organisations have agreed to comply with that Recommendation and the following as set out immediately below.

[29] Additionally, the Deputy President recommended that:

• Ergon continues to pay the 10 day fortnight loading to EITs who are required to revert to a 9 day fortnight, subject to the absorption and offsetting principles set out above;




[30] The above Recommendation is the Recommendation that Ergon advised the Commission it did not intend to comply with. The offsetting principles referred to in the Deputy President’s Recommendation appear in paragraph [58] of the Deputy President’s Recommendation.

[31] The reference to EIT’s in the Recommendation is a shorthand form of Ergon’s description of the 68 employees concerned in the dispute whose positions have been declared redundant and who are seeking redeployment in accordance with the terms of the Agreement.

Arbitration and Current Characterisation

[32] The matter was listed for Arbitration hearing before me at Brisbane on 11 December 2013, pursuant to a request by Ergon in accordance with Clauses 2.1.18 and 2.1.19 of Clause 2.1 of the Agreement.

[33] Directions for the filing of material and submissions in relation to the dispute were issued on 12 November 2013.

[34] At the hearing on 11 December 2013, Ergon filed an outline of the “Applicant’s Submissions”, which was marked as Exhibit A, which supported submissions earlier filed. The Respondent Organisations were allowed until 18 December 2013 to respond to those submissions.

[35] Under the heading “Background”, in Exhibit A, Ergon referred to the dispute subject to Arbitration by the Commission in the following terms:

[36] At this point, it is convenient to note, as submitted by Mr Henderson for the QSU, that the terms “employees in transition” (EIT’s) are not contained within the Agreement and comprise a descriptor, invented by Ergon, of those persons whose current circumstances will be affected by the determination of the dispute. I note this observation and appreciate that this descriptor of the employees or their circumstances should not be considered as having any effect as an aid to the interpretation of the words or express terms of the Agreement. This is important when considering how the express terms of the Agreement apprehend the circumstances of the relevant employees.

[37] The words used by the Agreement such as redundancy, redeployment and retrenchment, in their relevant contexts, are terms which, variously, have significant application or potential application to the circumstances of the relevant employees. It is inappropriate to attribute any meaning to the descriptor EIT or its extended text as if it formed a term of the Agreement when the Agreement was made for the purposes of construing those terms. However, the EIT formulation evidences Ergon’s understanding of the status of the relevant employees, presumably as a result of the redundancy of the positions in which those employees were working and in the context of the operation of the redeployment and retrenchment terms of the Agreement applicable to their situation.

[38] In the submission, on behalf of the ETU 5, at paragraph 3 thereof, the dispute is characterised as follows:

“ 3. Specifically, the questions to be determined by FWC in relation to the dispute between the parties, are:

• Does the 2011 Agreement allow Ergon to require “Employees in Transition”, that is an employees whose position has been made redundant, and who has elected to be redeployed, to revert to a 9 day fortnight?



• If the answer to the above question is yes, in those circumstances does the 2011 Agreement allow the employer to stop paying the 10 day fortnight all- purpose loading?”




[39] The matter in dispute is as characterised by the second dot point of the submissions of ETU. There is no dispute before me which may be the subject of Arbitration in accordance with the terms of the Agreement concerning Ergon’s right to give notice to the relevant employees to revert to a nine day fortnight. This is because that dispute is settled by the acceptance on the part of the Organisations of the relevant part of the Recommendation of the Deputy President shown above (the first part).

[40] Therefore, what is in dispute is well characterised in the second of the two questions contained in paragraph 3 of the ETU’s submission. Essentially, this is because of Ergon’s intention not to comply with the Recommendation of the Deputy President issued on 30 October 2013, as encapsulated in paragraph [17] above. In particular not to continue to pay the so called EIT’s the amounts payable under the Agreement for the working of a ten day fortnight regardless of the fact that they are employees whose positions have been declared redundant and who are subject to the redeployment provisions of the Agreeement.

[41] Ergon maintains that the relevant employees (the so called EIT’s) whose positions have been declared redundant and are seeking redeployment should not continue to be paid the relevant loadings applicable to a 10 day fortnight, because Ergon has issued effective notification to them of the reversion to a nine day fortnight.

[42] One notable collateral consequence of this, it would seem, is that should such employees be voluntarily retrenched in accordance with the terms of the Agreement, the redundancy benefits payable to them would not be calculated by reference to the “base rate of pay”, including prescribed loadings applicable to the working of a 10 day fortnight, which applied when Ergon advised the employees that the positions they were working in were redundant.

[43] Having regard to the evolution of the matters in dispute, as recited above, it is convenient to refer to the submissions of the QSU, at paragraph 35 thereof, which are made in relation to employees who have been notified that the position they have been working in has been declared redundant and who seek redeployment in accordance with the terms of the Agreement, where the following is stated:

‘ There is also no specific reason why the employer could not require reversion to nine day fortnight arrangements provided that the 10 day fortnight loading continues to be paid.”

[44] On my understanding, the Organisations submit that the entitlement to continue to receive the ten day fortnight loadings endures for the 68 employees concerned (the so called EIT’s), (notwithstanding an effective notice of reversion from a 10 day to a nine day fortnight,) because those employees have been advised that their position is redundant and are seeking redeployment.

This submission conforms with the Organisations’ acceptance of the Recommendation of the Deputy President and the broader decisional reasoning of the Deputy President in the Recommendation.

[45] It is therefore appropriate to refer in more detail to the Recommendation of the Deputy President. In essence, the Deputy President concluded that, because the 68 employees (the so called EIT’s) are employees whose positions had been declared redundant when working a 10 day fortnight, the provisions of the Agreement regulating the particular circumstances of such employees mean that those employees enjoy an entitlement to continue to be paid the amounts prescribed by the Agreement for a ten day fortnight, for reasons apparent in her Recommendation, which will be discussed below.

[46] The following extract from the Recommendation of the Deputy President illustrates the reasoning upon which the Recommendations were founded.

[53] The term “base rate” in clauses 8.7.1 and 8.7.2 is simply the method by which the relevant all purpose 10 day fortnight loading is calculated. The entitlement of an EIT to receive the “base rate of pay” is found in clause 10 of Schedule 3, and not clause 1.11 of the Agreement. The effect of clause 10 of Schedule 3 is to maintain “as a minimum” the “base rate of pay” of an employee who is redeployed. In the context of a regime where employees can elect to be redeployed, in my view they should be considered as such from the point they make the election.

[54] “Base rate of pay” for the purposes of Schedule 3 is defined in clause 4. The definition includes “any other all purpose allowance” and also includes “annualised rate including any applicable loadings for employees on Alternative Employment Arrangements”. Clauses 8.7.1 and 8.7.2 provide that the 10 day fortnight loadings are “all purpose loadings”. As such, they are within the definition of “base rate of pay” in clause 4 of Schedule 3 of the Agreement. Further, the loadings are “annualised” by virtue of being all purpose loadings paid in addition to an annual salary, and are “applicable loadings for employees on Alternative Employment Arrangements”. The definition of “base rate of pay” is a broad and inclusive definition and one that is not strained by the inclusion of the 10 day fortnight loading.

[55] It is clear that clause 10 of Schedule 3 entitles EITs to maintain their “base rate of pay” as defined in clause 4 of Schedule 3 “as a minimum” and that this includes all purpose 10 day fortnight loadings. If such loadings were intended to be excluded, they could have been dealt with in the clause in the same manner as shift allowances. This entitlement for EITs to maintain their “base rate of pay” exists notwithstanding that Ergon has exercised its right to give EITs notice of the requirement to revert from a 10 day fortnight to a 9 day fortnight.

[56] I do not accept Ergon’s arguments that this interpretation will lead to anomalous or unfair outcomes. EITs are persons whose positions are redundant. By virtue of clause 1.11 they are entitled to maintain their salary in accordance with Schedule 1 of the Agreement including any Agreement increases to that salary. Where EITs working a 10 day fortnight are required to revert to a 9 day fortnight in accordance with clause 8.7.3 they are also entitled to retain the 10 day fortnight loading in addition to their salary.

[57] There are beneficial provisions designed to assist EITs by maintaining certain entitlements which existed at the point of redeployment so that EITs are not disadvantaged on redeployment, or in the event that they are subsequently retrenched. There is nothing anomalous or iniquitous about such provisions.

[47] I might note that I am inclined to read the word “There”, which commences paragraph [57] of the Deputy President’s Recommendation as including the meaning “These”. The essential meaning of the paragraph is the same either way.

[48] It is clear that what persuaded the Deputy President to make the Recommendation was that the provisions of Clause 8.7.3 of the Agreement which govern “reversion” of employees from working arrangements based on a 10 day fortnight to those in respect of which the hours of work would be spread over nine days in a fortnight should be understood as general or generic provisions of the Agreement. In this respect it is clear that the Deputy President concluded that, accordingly, the redundant status of the relevant employee’s positions was no impediment to Ergon giving the notice of reversion provided for by Clause 8.7.3 of the Agreement.

[49] However, no doubt in harmony with traditional principles of legal interpretation, whereby it may be said that a special or particular provision will, to the extent of its terms, prevail over a general provision, 6 the Deputy President found the redundancy, redeployment and retrenchment provisions of the Agreement operated to preserve the right of the relevant employees to continue to receive payment of the 10 day fortnight loadings in accordance with the terms of Clauses 8.7.1 and 8.7.2 of the Agreement and Clause 10 of Schedule 3 of the Agreement.

[50] It seems clear the Deputy President has found that the redundancy, redeployment and retrenchment provisions of the Agreement operate specifically in relation to employees whose positions have been declared redundant and are seeking redeployment, such that the relevant employees (the so called EIT’s) were, by virtue of their positions having been declared redundant by Ergon are subject to the benefits of those terms of the Agreement that govern redundancy situations, redeployment and retrenchment. Hence, while Ergon may give effective notice of reversion from a ten day fortnight to employees’ generally, special provisions apply when such employees have been notified that their positions are redundant and are seeking redeployment.

[51] At this point however, I should digress to observe that, in my view, the decision I must make for the purposes of arbitrating the issues in dispute does not proceed as an appeal by Ergon from the Recommendation of the Deputy President.

[52] Rather, in my view, it is appropriate to proceed as if hearing the residual extant dispute de novo. However, it would be fatuous to completely ignore the Deputy President’s Recommendation and the reasoning therefore. The fact of the Recommendation arises from and in the context of the Dispute Settlement Procedure agreed upon by the parties to the Agreement and forms a part of the surrounding circumstances of the dispute, as it now stands, as a consequence of the making of the Recommendation by the Deputy President and the acceptance of the Recommendation by some of the disputants.

[53] At this point, although not determinative, it is illustrative, informative and convenient to refer to certain of the “reversion” provisions of Clause 8.7.3 as follows:

If during the three (3) month notice period the employee receives notice of redundancy or advises Ergon Energy that they intend to retire no later than twelve (12) months after the initiated three (3) month notice, the employee will not be required to revert.

(emphasis added)

[54] It will be noted that the effect of this provision is that, in the circumstances prescribed, an employee’s earnings for a 10 day fortnight would seem to be preserved until the employee exits the employment of Ergon. Employees notified by Ergon of redundancy (of their position) within three months of being notified of a requirement to revert from a 10 day fortnight are not required to so revert and would continue to receive the “base rate of pay” for working a ten day fortnight. I shall return to this aspect of the Agreement in due course.

Redundancy, Redeployment and Retrenchment - a special code of the Agreement?

[55] Before turning to address the terms of the Agreement in relation to this subject it is informative to refer to recent authority of the Federal Court of Australia on the approach to be taken to construing the meaning of the terms of industrial instruments. In the case of Australian National Pilots Association v Qantas Airways Ltd  7Rares J stated the following:

51 A certified agreement, like all similar instruments made under industrial laws, such as awards, must be construed in light of its industrial context, having regard to the problem at hand: Amcor Ltd v Construction, Forestry, Mining and Energy Union  (2005) 222 CLR 241 at 246 [2] per Gleeson CJ and McHugh J, 258 [50] per Gummow, Hayne and Heydon JJ, 261-262 [64]-[66] per Kirby J, 282-283 [129]-[131] per Callinan J. Such an agreement is a hybrid between a contract, usually between an employer or employer organisation and a union or organisation of employees, and a piece of delegated legislation given force of law by a statutory process of approval by the Commission or a similar independent body. Ordinarily, its terms will have been arrived at through long negotiation against a background of, first, a superseded industrial instrument that made some similar and other different provisions and, secondly, legislation that in light of the experience of the last 20 or so years, is likely to have changed substantively since the superseded instrument. The instrument will regulate the industrial employment conditions of employees who, however, are not directly parties to it, although, ordinarily, their views will have been expressed about its terms.

52 So, in construing such an instrument, a court must have regard to more than the words of the text because the drafters wrote those words in the matrix of facts in which it had been negotiated in order to achieve certainty in the respects it addressed. The court will need to appreciate the industrial purpose of the agreement, and that of the particular term(s) in issue, against the industrial relations background of the employers, employees and employee organisations involved in its creation. That matrix of facts will provide the context to inform how an objective person, in the position of those in the relevant industry or sector, would understand the language in issue…

53 The agreement must be construed so that individual clauses such as… are read coherently in the context of the agreement as a whole.

[56] In light of the above, it is useful to note that the words redundancy, redeployment and retrenchment have distinct meanings in the language of industrial relations, although they can often be confused or conflated. Redundancy describes the circumstance of a role or position within an organisation which is no longer required. Redeployment describes a process whereby an employee and their employer engage in efforts to establish an employee, whose position is no longer required, in another position within the organisation. This process is followed to avoid the retrenchment to the employee. Retrenchment, individually or collectively, describes termination of an employee’s employment on account of the redundancy of a position or positions, often, if not usually, where no redeployment is possible.

[57] It seems to me, as it did the Deputy President, that the Agreement makers intended to make a specific code of conditions which would apply to a category of employees who fall into a set of circumstances defined by its applicable terms in Schedule 3 of the Agreement and elsewhere, namely redundancy, redeployment and retrenchment. This code has different dimensions and parameters in various terms of the Agreement including, as referred to immediately above, in the reversion provisions of Clause 8.7.3 of the Agreement, which have the effect of distinguishing circumstances of what would otherwise be a general rule of reversion from a ten day fortnight to a nine day fortnight. So much is also generally evident from Clauses 1.10, 1.11 and Schedule 3 of the Agreement “Redundancy Provisions”.

[58] Clause 1.10 is of considerable significance. It provides that there will be no forced retrenchments for the life of the Agreement. In this respect it is pertinent to draw attention to the provisions of clause 1.11 which is clearly predicated upon the concept of “salary” maintenance. The scheme of Clause 1.11 would seem to strongly indicate an intention of the Agreement makers to maintain the “salary” of employees whose positions are made redundant. However, “salary” has a particular and technical meaning, which in my view does not include the amounts of the loadings variously payable to the relevant employees in question for working a ten day fortnight, which are in dispute. Those amounts are distinct from “salary” and payable in particular circumstances variously defined by the terms of the Agreement.

[59] In my view, it would be entirely artificial to read the intention of the agreement makers in respect of Schedule 3 of the Agreement other than harmoniously with the terms and conditions of the Agreement expressed in Clauses 1.10 and 1.11 of the Agreement, in a general sense, as far as possible. The terms of an Agreement should always be interpreted in the immediate context in which they appear and in the wider context and logical application of the Agreement as a whole.

[60] There is a strong indication in the terms of the Agreement of a compact between the agreement makers which maintains the economic circumstances of employees whose positions become redundant, as is evidenced, for example, by Clause 8.7.3 above, pending an outcome of the redundancy, redeployment and retrenchment provisions of Schedule 3 and elsewhere in the Agreement.

[61] I also consider the expression of the Objectives of Schedule 3 to be relevant to this approach.

[62] Clause 4 of Schedule 3 of the Agreement defines “Redundancy”. It is not necessary to explore the definition at length as there is no dispute that the position of the employees whose circumstances are the subject of the dispute have been declared redundant by Ergon for the purposes of Schedule 3 and are seeking redeployment.

[63] It is however of note that Clause 4 of Schedule 3 introduces the concept of “base rate of pay” which is comprehensively defined beyond the “Rates as determined by the Salary Schedule of the Agreement” (Emphasis in original) to include various “Allowances” (Emphasis in original) and to exclude overtime, shift loadings and weekend penalty rates. The usage of the term “base rate of pay” in the terms of the Agreement governing situations of redundancy, redeployment and retrenchment is ubiquitous.

[64] The makers of the Agreement can therefore be understood to have paid close and specific attention to what will constitute an employee’s “base rate of pay” for the purposes of the operation of Schedule 3 of the Agreement, not only in Schedule 3 where the terms of the Agreement make reference to retrenchment on account of redundancy but elsewhere, including in Clauses 8.7.1 and 8.7.2 of the Agreement.

[65] Clause 10 of Schedule 3 of the Agreement, Redeployment, has logical application to the circumstances of the 68 employees in respect of whom the dispute arises. In fact, having regard to the terms of the second paragraph of Clause 10 of Schedule 3 it has very specific effect, in my view. It is of note that, consistently with Clause 1.11 and the definition of “Base Rate of Pay” (emphasis in original) in paragraph 4 of Schedule 3, the third paragraph of Clause 10 of Schedule 3 reiterates, the particular exclusion of shift allowances from the entitlements of employees subject to the operation of Clause 10 of Schedule 3 of the Agreement. This exclusion was noted in a particular context in the Recommendation of the Deputy President. 8

[66] In my view, in the circumstances before me, the terms of the Redundancy provisions of the Agreement strongly indicate that it was the intention of the Agreement makers that employees to whom Clause 10 of Schedule 3 applies are entitled to retain their “base rate of pay” while engaged in redeployment and for the purposes of voluntary retrenchment.

[67] In my view, it would be perverse to conclude that the intention of the Agreement makers was that an employee whose position is declared redundant should drop to their “salary” while seeking redeployment and only if successfully redeployed be entitled to a much higher “base rate of pay” prescribed by the definition in Clause 4 of the Agreement thereafter. This would be the effect of the construction of the proper application of the terms advocated by Ergon in respect of the so called EIT’s. In this respect attention is drawn to the terms of the second paragraph of Clause 10 of Schedule 3 of the Agreement, which is as follows:

10. REDEPLOYMENT

Following the consultative steps detailed in Clause 6 of this Schedule, all efforts will be made to find suitable alternative employment for employees whose positions are declared redundant. Each affected employee will be individually interviewed to determine what options may exist for the management of that employee’s future.

Where an employee is redeployed they will retain their Base rate of pay prior to redeployment as a minimum. This will not include shift loadings unless applicable to the redeployed position.

Where applicable, payment of redeployment expenses will be in accordance with Ergon Energy’s Relocation Policy applying at the time.

Redeployed employees will be eligible for retrenchment benefits if it is found within three (3) months by either themselves or Ergon Energy, that the alternative position is unsatisfactory.

(emphasis added)

[68] In my view, these words should be construed such that if an employee’s position is declared redundant and an employee is subsequently redeployed the employee will continue to receive the “base rate of pay” of the position in which the employee was working when the position was declared redundant by Ergon. This would include the loadings payable for working a ten day fortnight in that position because such loadings form part of the employees “base rate of pay” for working in that position, the redundancy of which causes the redeployment provisions of the Agreement to operate.

[69] Retrenchment of redundant employees such as the so called EIT’s will only occur on an “early separation” or “voluntary retrenchment” basis under the terms of the Agreement. Retrenched employees will receive retrenchment benefits which will be based on payment of a number of weeks pay for completed and pro rata years of service calculated at their applicable “base rate of pay”, as defined by the terms of the Agreement.

[70] In my view, to devalue the operation of the redeployment provisions of the Agreement by creating a lacuna in an employee’s entitlement to continue to receive the amounts prescribed by Clauses 8.7.1 and 8.7.2 while seeking redeployment would seriously undermine the Objectives of the Redundancy Provisions in Schedule 3 of the Agreement and the readily apparent scheme of the Agreement. The apparent consequence of Ergon’s position is that employees seeking redeployment would be paid substantially less than they were entitled to when the notice of the redundancy of the positions they were working in was issued by Ergon, whilst seeking such redeployment or, possibly further, when retrenched by voluntary separation.

[71] If an employee is redeployed, in accordance with the terms of the Agreement, that employee would be entitled to continue to receive the “base rate of pay” applicable to them at the time of the redundancy of the position from which they are redeployed (which includes the amounts of loading payable for working a ten day fortnight). Moreover, if within three months, a redeployed employee is dissatisfied with the position to which they have been redeployed and is voluntarily retrenched, the basis for the calculation of their voluntary retrenchment benefit will therefore be the “base rate of pay” for the position in which they were working at the time of the redundancy, including the amounts of loading payable for working a ten day fortnight, if those amounts formed part of their “base rate of pay”.

[72] This is because the employee, whose position has been declared redundant who is ultimately redeployed, is entitled, unambiguously, to be paid at their “base rate of pay” “prior to redeployment” which will therefore be the basis of any voluntary retrenchment benefit subsequent to redeployment. Reference is made to the second paragraph of Clause 10 of Schedule 3 in this regard.

[73] By Clauses 8.7.1 and 8.7.2 of the Agreement, the relevant loadings applicable to the 10 day fortnight working arrangements are to be included in the calculation of retrenchment benefits. The effect of the Agreement is that such amounts would form part of the retrenchment benefit in the event of early separation and, I think, voluntary retrenchment.

[74] The Deputy President in her Recommendation of 30 October 2013 said the following at paragraph [53] thereof.

[53] The term “base rate” in clauses 8.7.1 and 8.7.2 is simply the method by which the relevant all purpose 10 day fortnight loading is calculated. The entitlement of an EIT to receive the “base rate of pay” is found in clause 10 of Schedule 3, and not clause 1.11 of the Agreement. The effect of clause 10 of Schedule 3 is to maintain “as a minimum” the “base rate of pay” of an employee who is redeployed.

[75] There is a significant implication for the operation of the terms of the Agreement governing voluntary retrenchment which arises if a contrary view is taken. This concerns the “base rate of pay” applicable to the calculation of a retrenchment benefit applicable where an employee is unable to be redeployed. What would be the “base rate of pay” of the relevant employees (the so called EIT’s) in the event of voluntary retrenchment in the event that redeployment is unsuccessful if the amounts payable under Clauses 8.7.1 and 8.7.2 of the Agreement are no longer applicable by reason of the notice of reversion to a nine day fortnight issued by Ergon?

[76] This subject matter was referred to by the Deputy President at paragraph [57] of her consideration of the terms of the Agreement as follows:

[57] There are beneficial provisions designed to assist EITs by maintaining certain entitlements which existed at the point of redeployment so that EITs are not disadvantaged on redeployment, or in the event that they are subsequently retrenched. There is nothing anomalous or iniquitous about such provisions.

(emphasis added)

[77] In this respect, an obvious potential anomaly is immediately apparent. It will be recalled that the terms of the final paragraph of the reversion provisions of the Agreement, Clause 8.7.3, provides that if notice of redundancy of an employee’s position is given during the three month notice period required of Ergon for an employee to revert from a ten day to a nine day fortnight, an employee is “not required to revert”. The consequence for an employee in these circumstances is unambiguous for the purposes of the calculation of any voluntary retrenchment benefit. Their “base rate of pay” for the purpose of calculating that benefit would include the loadings payable for a 10 day fortnight.

[78] I am unable to reconcile an intention on the part of the Agreement makers such that where an employee’s position is declared redundant after a notice of reversion from a ten day fortnight an employee is not required to so revert and would continue to receive the loadings applicable to ten day fortnight, which would form a part of their “base rate of pay” in the event of voluntary retrenchment, whereas an employee whose position is declared redundant and is then given three months notice to revert from ten day fortnight to a nine day fortnight will be required to so revert and consequently, potentially, suffer a significant loss of income and consequently significantly reduced retrenchment entitlements in the event of voluntary retrenchment.

[79] If employees whose positions have been declared redundant by Ergon, who are seeking redeployment but are not yet redeployed are not entitled to continue to receive their “base rate of pay” which includes loadings for working a ten day fortnight and those employees are not ultimately redeployed, it would seem, the “base rate of pay” of such employees, in the event of voluntary retrenchment, would not include the amounts payable as an “all purpose allowance”; in respect of working a 10 day fortnight, contrary to the apparent intention in Clauses 8.7.1 and 8.7.2 of the Agreement. I cannot be satisfied that this was the intention of the Agreement makers.

[80] A consequence would be that Ergon, having decided that the position of an employee who is working a ten day fortnight is redundant, need only issue a notice of the redundancy of an employee’s position and the following day issue a notice of reversion under Clause 18 to reduce the employee’s “base rate of pay” from between 13% and 22.5% with extremely significant effects on the level of an employee’s income during redeployment and any voluntary retrenchment entitlements which might arise later. I consider such an outcome dissonant with the provisions of the Agreement governing redundancy, redeployment and retrenchment.

[81] In the case of Kucks v CSR Ltd (Kucks) 9 Madgwick J stated the following as an appropriate approach to the interpretation of industrial awards. This authority has been subsequently adopted by the Full Bench of Fair Work Australia as appropriate to the interpretation of Enterprise Agreements. 10

‘It is trite that narrow or pedantic approaches to the interpretation of an award are misplaced. The search is for the meaning intended by the framer(s) of the document, bearing in mind that such framer(s) were likely of a practical bent of mind: they may well have been more concerned with expressing an intention in ways likely to have been understood in the context of the relevant industry and industrial relations environment than with legal niceties or jargon. Thus, for example, it is justifiable to read the award to give effect to its evident purposes, having regard to such context, despite mere inconsistencies or infelicities of expression which might tend to some other reading. And meanings which avoid inconvenience or injustice may reasonably be strained for. For reasons such as these, expressions which have been held in the case of other instruments to have been used to mean particular things may sensibly and properly be held to mean something else in the document at hand.

But the task remains one of interpreting a document produced by another or others. A court is not free to give effect to some anteriorly derived notion of what would be fair or just, regardless of what has been written into the award. Deciding what an existing award means is a process quite different from deciding, as an arbitral body does, what might fairly be put into an award. So, for example, ordinary or well-understood words are in general to be accorded their ordinary or usual meaning.’

[82] Although not put explicitly by Ergon in their submissions it seems to me that the proposition is that employees, subject to a notice of reversion from a ten day fortnight to a nine day fortnight, whose positions had been declared redundant when the notice of reversion is given and who seek redeployment, “fall through a crack” in the terms of the Agreement. That metaphorical “crack” might seem to appear between the first and second paragraph of Clause 10 of Schedule 3 of the Agreement, such that an employee whose position is declared redundant and who is not successfully redeployed to a position is ineligible to continue to receive their “base rate of pay” at the time that the position in which they were employed became redundant.

[83] In my view, the intermediation of the redeployment process and the object of “redeployment” itself should be interpreted as seamlessly as possible. In this respect I agree with the reasoning of the Deputy President at paragraph [53] of her Recommendation.

[84] I cannot be satisfied that it was the intention of the Agreement makers to incorporate the distinctions and contradictions variously embedded in Ergon’s conception of how the Agreement would operate in respect of employees whose positions are declared redundant by Ergon who are subject to redeployment. There could be a profound quantitative difference between the redeployment and retrenchment entitlements of employees whose positions become redundant dependent upon whether Ergon notified of that redundancy before or after giving notice of reversion from a ten day fortnight to a nine day fortnight. This is illogical and deeply anomalous. Most importantly it is, in my view, contrary to the evident intentions of the Agreement makers in relation to redundancy, redeployment and retrenchment.

[85] Moreover, those who successfully seek early separation, which is provided for by the Agreement, it would seem, would be treated differently to those who unsuccessfully sought redeployment and were ultimately voluntarily retrenched. Employees subject to early separation would be entitled to a retrenchment benefit calculated at their “base rate of pay” for the redundant position, including any loadings payable for a ten day fortnight, whereas for the unsuccessful redeployees, voluntary retrenchment benefits would be calculated at the “base rate of pay” for a nine day fortnight because of the notice of reversion given by Ergon. This is because, if Ergon is right, having reverted to a nine day fortnight, the unsuccessful redeployees’ entitlements to their “base rate of pay” for the purpose of the calculation of any voluntary retrenchment benefit would be significantly less than the “base rate of pay” applicable to the redundant position in which they were employed, when working a ten day fortnight.

[86] Accommodating such uneven and incoherent outcomes within the context of the terms of the Agreement regulating redundancy, redeployment and retrenchment situations, requires a level of semantic gymnastics foreign to what, in the relevant context, would seem a straight forward intention, evidenced by the terms of the Agreement, that employees whose positions are declared redundant by Ergon should be entitled to retain their “base rate of pay” for the purposes of redeployment and the calculation of voluntary retrenchment benefits. I consider that the redundancy, redeployment and retrenchment provisions of the Agreement are a contiguous special code applicable to the circumstances of the employees the subject of the dispute.

[87] It is much easier to accept from the consideration of all of the various terms of the Agreement that the makers of the Agreement intended to treat employees, whose positions are declared redundant by Ergon, as a class of employees who retain their “base rate of pay” in the positions which have been made redundant for all of the purposes of the application of Schedule 3 of the Agreement while seeking redeployment as prescribed by the terms of the Agreement and for the purposes of calculating voluntary retrenchment benefits.

[88] The distinction embedded in the submission of Ergon and the collateral implications thereof are far too convoluted to be reasonably comprehended as the intention of the Agreement makers.

[89] As an observation, on my consideration of the terms of the Agreement there appears to be no express temporal regulation of the redeployment component of the code of terms and conditions of employment which applies to employees whose positions are declared redundant who are subject to redeployment and voluntary retrenchment.

[90] On the characterisation of the dispute, as it stands before me, the scope of the dispute does not extend so far as to allow the determination of the duration of “redeployment” or its constituent characteristics. I should therefore refrain from doing so. However, I can observe that, consistent with my earlier description of the comprehensive and contiguous meaning of redundancy, redeployment and retrenchment in industrial relations, redeployment is not an indefinite or permanent state. For my purposes, the facts are that the relevant employees (the so called EIT’s) are involved in redeployment. That fact is the axis of this decision in the circumstances and so long as those employees are subject to the redeployment provisions of the Agreement, successful or otherwise, my decision is operative.

[91] For all of these reasons I agree with the Deputy President and for the purposes of determining the dispute by arbitration in accordance with Clause 2.1.19 of the Agreement, I decide that the relevant employees (the so called EIT’s), whose positions have been declared redundant by Ergon, who were working under the ten day fortnight terms of Clause 8.7 of the Agreement at that time, are entitled to continue to receive loadings applicable to them under the relevant provisions of Clause 8.7.1 and Clause 8.7.2 of the Agreement at the time that their positions were declared redundant by Ergon, while seeking redeployment in accordance with the terms of the Agreement.

[92] I decide accordingly for the purposes of Clause 2.1.19 of the Agreement.

COMMISSIONER

Appearances:

Ms P Rogers, Mr N Henderson, Ms K Scott, For the Organisations

Mr B Montgomery, for the Respondent

Hearing details:

Before Commissioner Lewin

2013

Brisbane

11 December 2013.

Final written submissions:

25 November 2013, submissions by Ergon

17 December 2013, submissions by Organisations

Appendix A

PART 8 HOURS OF WORK

8.1 NINE DAY FORTNIGHT

The standard hours of work will not exceed 36.25 hour per week (Monday to Friday) over a nine (9) day fortnight. The maximum ordinary hours that can be worked per day are eight (8) hours three (3) minutes. However, other patterns of work may be worked by Mutual Agreement between the parties at a particular place of work. The guidelines for these arrangements will be developed in accordance with the flexibility Clause of this Agreement.

In order to meet operational and work requirements, the daily spread of hours for day working employees, provided for in this Agreement on an ordinary work day (6.00am to 6.30pm, Monday to Friday), may be increased by Mutual Agreement to an additional one hour at either the commencement or finish of the ordinary work day.

This will result in the daily ‘spread of hours’ being increased to cover a period of either 5.00am until 6.30pm or 6.00am to 7.30pm. The ordinary working hours may then be worked between these times, Monday to Friday inclusive with a break of not more than one hour and not less than thirty minutes for a meal.

8.2 ROSTERED DAY OFF (RDO)

The Rostered Day Off (RDO) will be Scheduled on either a Monday or Friday, unless varied by Mutual Agreement to suit operational requirements.

Employees working a nine (9) day fortnight, who are required to work on their rostered day off (RDO), will be paid the overtime rates prescribed for work on Mondays to Fridays and where required to report for work between midnight and 6 a.m. will be paid at the rate of double time for all time worked up to 7 a.m.

By agreement with Ergon Energy, employees who work on their rostered day off and elect to substitute another ordinary working day for their rostered day off will be paid at base rates for work during what otherwise would be ordinary hours (8 hours 3 minutes), and appropriate overtime rates for work performed in excess of their ordinary hours.

National Contact Centre

The allocation of an employee’s Rostered Day Off can be any day Monday to Friday as determined by Ergon Energy for all National Contact Centre positions, where the following conditions are met:

● For all new or vacant positions, Ergon Energy will have the discretion to set or Schedule the employee’s Rostered Day Off (RDO) on any day Monday to Friday.

● RDO arrangements for existing positions will remain in place and the provisions outlined will apply (where applicable) for appointments to new or vacant positions only, unless the change is mutually agreed.

● In determining whether an RDO will be Scheduled on a day other than a Monday or Friday, Ergon Energy will take into consideration the employee’s personal and/or financial commitments where applicable.

8.2.1 Banking of Rostered Day Off (RDO)

The banking of a RDO is subject to Mutual Agreement between the employee and relevant supervisor or manager and is to be recorded on the employee’s timesheet. Employees will only

be able to bank up to five (5) RDO’s. Any attempt to bank further RDO’s in excess of this limit will be paid at appropriate overtime rates.

The taking of banked RDO’s will be subject to Mutual Agreement between the employee and relevant supervisor or manager recorded on the employee’s timesheet. Any request to take a banked RDO will not be unreasonably refused and may be taken in conjunction with annual leave.

Apprentices when on block release at TAFE or other learning institutions and who as a result forgo their RDO due to the block release training Schedule must take any previously agreed banked time off as soon as practicable within four (4) weeks of returning to their Scheduled place of work.

Banked RDO’s will be accrued at ordinary time and if elected by the employee to be paid out, will be paid out at ordinary time rates.

8.3 NATIONAL CONTACT CENTRE – EIGHT DAY FORTNIGHT ARRANGEMENT

1. The option to work an eight (8) day fortnight arrangement (72.5 hours per fortnight) will be available to full time employees employed in Ergon Energy’s National Contact Centre (excluding Team Leaders) on a mutually agreed basis between Ergon Energy and the employee.

2. This arrangement will not affect the salary for a full time employee, currently working a nine (9) day fortnight.

3. The maximum ordinary hours per day is nine (9) hours three (3) minutes, provided that on the second Monday or Friday of each fortnight the maximum ordinary hours per day will be nine (9) hours and nine (9) minutes. Overtime will be paid for hours worked in excess of nine (9) hours three (3) minutes and in the case of the second Monday or Friday of each fortnight in excess of nine (9) hours and nine (9) minutes in any one day.

4. The daily spread of hours for employees under this arrangement will be from 6.00am to 6.30pm, Monday to Friday, and may be increased by Mutual Agreement to an additional one hour at either the commencement or finish of the ordinary work day.

5. The Rostered Day Off (RDO) will be Scheduled by Ergon Energy in consultation with the employee on either a Tuesday, Wednesday or Thursday. To ensure operational requirements are met Ergon Energy reserves the right to Schedule the RDO on a specific day where required.

6. Employees who are required to work on their RDO, will be paid the overtime rates prescribed for work on Mondays to Fridays and where required to report for work between midnight and 6 a.m. will be paid at the rate of double time for all time worked up to 7 a.m.

7. By agreement with Ergon Energy, employees who work on their RDO and elect to substitute another ordinary working day for their RDO will be paid at base rates for work during what otherwise would be ordinary hours, and appropriate overtime rates for work performed in excess of their ordinary hours.

8. Employees may elect to revert to a 9 day fortnight by providing Ergon Energy with six (6) weeks written notice.

9. Where Ergon Energy requires an individual to revert to a nine (9) day fortnight, it will not do so without first providing the employee with three (3) months written notice.

8.4 LEGACY WEEKLY AND FORTNIGHTLY WORK PATTERNS

Existing three (3) day week, four (4) day week, or eight (8) day fortnight work patterns currently established in the legacy regions of Mackay, Wide Bay and South West will be maintained during the life of this Agreement where the incumbent continues to occupy their current position. The position will revert back to a nine (9) day fortnight on the resignation or retirement of the incumbent, or when the incumbent is successful in applying for a new position based on a nine (9) day fortnight. Notwithstanding the above, employees working in the three (3) day week arrangement will, where that group is reduced down to one (1) employee on a permanent basis, that employee will revert to a nine (9) day fortnight.

8.5 MEAL BREAK

To facilitate greater flexibility, timing of meal breaks may be varied to meet the operational requirements of the business. The recognised unpaid lunch break will be rostered between the 4th and 6th hour from the employee’s start time. An employee will be entitled to receive a minimum of thirty (30) minutes and a maximum of one (1) hour for a meal break, excluding shift workers.

No employee will be required to work more than six (6) hours without a break for a meal. All work done during the recognised meal period will be paid for at the rate of double time, and payment at this rate will continue until another and uninterrupted meal period of thirty minutes has commenced or until the cessation of that day’s work, which ever occurs first.

8.6 REST PAUSES

Where practicable every employee (other than a casual and part time employee) will be entitled to a rest pause or pauses not exceeding a total of twenty (20) minutes duration in Ergon Energy’s time during the rostered work period.

Such rest pause or pauses may be taken in a manner and at such time or times as agreed upon between Ergon Energy and the majority of employees at the work location so that continuity of work will not be interrupted where continuity is necessary.

Casual and part time employees, who work a minimum of four (4) consecutive ordinary hours, but less than eight (8) ordinary consecutive hours on any one day, will receive a rest pause of ten (10) minutes duration. Employees who work a minimum of eight (8) ordinary consecutive hours will receive a rest pause or pauses not exceeding a total of twenty (20) minutes duration in Ergon Energy’s time during the rostered work period.

8.7 TEN (10) DAY ALTERNATIVE EMPLOYMENT ARRANGEMENTS

Where Ergon Energy offers these arrangements to new or existing employees, Ergon Energy will also offer the employee the option of remaining within the general terms and conditions of this Agreement. With the exception of those employees being offered an Individual Employment Arrangement (IEA), employees being recruited into new positions will not be required to make known whether they will agree to work a ten (10) day fortnight or nine (9) day fortnight until they have been formally offered the position.

The Parties also acknowledge that a number of employees are employed under individual employment arrangements that were in place prior to the lodgement of this Agreement. An employee may elect to remain on the terms of the individual employment arrangements or IEA while they continue to occupy their current position, provided the arrangement has been documented. In advertising positions on a ten (10) day fortnight, Ergon Energy will include a statement that a nine (9) day fortnight will also be available to the successful applicant on appointment.

8.7.1 Employees Classified at Salary Point 11.0 and above

The option to take up these arrangements will be on a mutually agreed basis between Ergon Energy and the employee who is classified at Salary Point 11.0 and above of this Agreement who agrees to work a ten (10) day fortnight arrangement in accordance with the following:

1. Where the Arrangement covers a forty (40) hour week, ten (10) day fortnight within the defined spread of hours 6.00am – 6.30pm Monday to Friday, the base rate shall be increased by 13%.

Employees under this arrangement remain eligible to receive EDSD Allowance or EDSD payment (if applicable), Working Away from Home Meal Allowances, Availability Duty Allowance and Incidental Allowance as applicable, however employees will be exempt from claiming the hours and overtime provisions of this Agreement up to forty (40) hours per week. Any authorised overtime for hours worked in excess of forty (40) ordinary hours per week will be paid at applicable overtime rates.

2. Where the Arrangement covers a forty (40) hour week, ten (10) day fortnight within the defined spread of hours 6.00am – 6.30pm Monday to Friday, and also consideration for a notional four (4) hours overtime per week (Monday to Sunday), the base rate shall be increased by 15%.

Employees under this arrangement remain eligible to receive Shift Penalties, EDSD Allowance or EDSD payment (if applicable), Working Away from Home Meal Allowances, Availability Duty Allowance and Incidental Allowance as applicable, however employees will be exempt from claiming the hours, overtime and travel time provisions of this Agreement up to forty four (44) hours per week. Any authorised overtime or travel time for hours worked in excess of forty four (44) ordinary hours per week will be paid at applicable overtime or travel time rates in accordance with the overtime or travel time provisions of this Agreement.

3. Where the arrangement covers a ten (10) day fortnight and also includes consideration for what would otherwise be for working of all overtime, Allowances as defined and all other penalties of this Agreement, the base rate will be increased by 20%.

Employees under this arrangement remain eligible to receive Shift Penalties, EDSD Allowance or EDSD payment (if applicable), Working Away from Home Meal Allowances Availability Duty Allowance and Incidental Allowance as applicable. Notwithstanding, extraordinary and continuous periods of work during major systems failures or damage caused by storms or cyclones will, where the period of hours worked is in excess of ten (10) hours each day for more than two (2) consecutive days be paid as overtime

Employees working pursuant to the above arrangements will remain entitled to all salary increases and other employment entitlements provided by this Agreement unless otherwise defined.

The employee and their manager or supervisor must monitor and give due consideration to the management of fatigue under all of the above arrangements.

The above all purpose loadings shall be used when calculating an employee’s payment for overtime, annual leave, Long Service Leave, parental leave, superannuation, severance and retrenchment payments.

Where such arrangements are made they shall be recorded in writing (with a copy for each party).

8.7.2 Employees below Salary Point 11.0

The option to take up these arrangements will be on a mutually agreed basis between Ergon Energy and the employee as follows:

● For those employees classified in the Administrative and Professional Managerial Streams between Salary Point 1.0 and Salary Point 11.0 contained in Schedule 1 of this Agreement.

● For those employees classified in the Technical Classification Stream covering Supervisory and Para-Professional sub-streams between Salary Point 9.0 and Salary Point 11.0 contained in Schedule 1 of this Agreement. For example the positions covered would typically be titled, Work Group Leader, Scheduler, Contract Officers, Technical Trainers, Electrical System Designers, Maintenance Officers and unique and stand alone positions as agreed by the parties.

For employees defined above who agree to work a ten (10) day fortnight arrangement this will be in accordance with the following:

4. Where the Arrangement covers a forty (40) hour week, ten (10) day fortnight within the defined spread of hours 6.00am – 6.30pm Monday to Friday, the base rate shall be increased by 15.5%.

Employees under this arrangement remain eligible to receive EDSD Allowance or EDSD payment (if applicable), Working Away from Home Meal Allowances, Availability Duty Allowance and Incidental Allowance as applicable, however employees will be exempt from claiming the hours and overtime provisions of this Agreement up to forty (40) hours per week. Any authorised overtime for hours worked in excess of forty (40) ordinary hours per week will be paid at applicable overtime rates.

5. Where the Arrangement covers a forty (40) hour week, ten (10) day fortnight within the defined spread of hours 6.00am – 6.30pm Monday to Friday, and also consideration for a notional four (4) hours overtime per week (Monday to Sunday), the base rate shall be increased by 17.5%.

Employees under this arrangement remain eligible to receive shift Penalties, EDSD Allowance or EDSD payment (if applicable), Working Away from Home Meal Allowances, Availability Duty Allowance and Incidental Allowance as applicable, however employees will be exempt from claiming the hours, overtime and travel time provisions of this Agreement up to forty four (44) hours per week. Any authorised overtime or travel time for hours worked in excess of forty four (44) ordinary hours per week will be paid at applicable overtime or travel time rates in accordance with the overtime or travel time provisions of this Agreement.

6. Where the arrangement covers a ten (10) day fortnight and also includes consideration for what would otherwise be for working of all overtime, Allowances as defined and all other penalties of this Agreement, the base rate will be increased by 22.5%.

Employees under this arrangement remain eligible to receive shift penalties, EDSD Allowance or EDSD payment (if applicable), Working Away from Home Meal Allowances, Availability Duty Allowance and Incidental Allowance as applicable. Notwithstanding, extraordinary and continuous periods of work during major systems failures or damage caused by storms or cyclones will, where the period of hours worked is in excess of 10 hours each day for more than two (2) consecutive days, be paid as overtime in accordance with the overtime provisions of this Agreement.

Employees working pursuant to the above arrangements will remain entitled to all salary increases and other employment entitlements provided by this Agreement unless otherwise defined.

The employee and their manager or supervisor must monitor and give due consideration to the management of fatigue under all of the above arrangements.

The above all purpose loadings shall be used when calculating an employee’s payment for overtime, annual leave, Long Service Leave, parental leave, superannuation, severance and retrenchment payments.

Where such arrangements are made they shall be recorded in writing (with a copy for each party

8.7.3 Reversion to General Agreement Provisions

Employees working the above arrangements may elect to revert to a nine (9) day fortnight by providing Ergon Energy with one (1) month’s written notice.

It is recognised that individuals may make additional personal financial commitments whilst under these arrangements and as such, where Ergon Energy requires an individual to revert, it will not do so without first providing the employee three (3) months written notice of Ergon Energy’s intention.

If during the three (3) month notice period the employee receives notice of redundancy or advises Ergon Energy that they intend to retire no later than twelve (12) months after the initiated three (3) month notice, the employee will not be required to revert.

8.7.4 Appointment of Ten (10) Day Fortnight

Notwithstanding the above arrangements which are made on a mutually agreed basis, the following may be advertised and awarded on a ten (10) day fortnight basis at the discretion of Ergon Energy:

● New and vacant positions classified in the Administrative Stream from Salary Point 11.0 and above.

● Vacant positions classified in the Administrative Stream which are below salary point 11.0 and are listed in Schedule 7 of this Agreement.

○ The positions details reflected in this Schedule are correct as at the date of lodgement of this Agreement.

○ The Parties agree that the position identification numbers can be reviewed through the life of this Agreement to ensure that position numbers accurately reflect the identified positions. This will be subject to consultationand agreement between the Parties, provided that agreement will not be unreasonably withheld.

● New and vacant positions classified in the Professional & Managerial stream from P&M Grade one (1) Salary Point 11 and above and where the position supervises coordinates and schedules other employees.

Employees who accept the above arrangement and who have been working a minimum of three (3) months in the position may elect to revert to a nine (9) day fortnight by providing Ergon Energy one (1) month written notice.

8.8 INDIVIDUAL EMPLOYMENT ARRANGEMENTS

An Individual Employment Arrangement (IEA) may be offered to an employee as determined by

Ergon Energy, who is paid a salary at or above Salary Point 11.0 of the classification structure of this Agreement. Flexible remuneration arrangements and changes to other conditions of employment may be negotiated subject to the following:

8.8.1 No Disadvantage

An Individual Employment Arrangement (IEA) will not, in terms of total remuneration value, disadvantage employees when compared to the relevant terms of the Agreement.

8.8.2 Hours of Work

The standard hours of work required for employees engaged on an IEA are 40 hours per week and a ten (10) day fortnight. These hours may be worked between 6.00am to 6.30pm Monday to Friday.

8.8.3 Salary & Loadings

Employees on an IEA will receive the salary point as specified in the Agreement for the classification of their position, plus the applicable loading as follows:

15% loading includes a notional Overtime component to cover up to four (4) hours overtime per week, all Allowances and Penalties (excluding Shift Penalties and the EDSD Payment).

20% loading includes a notional Overtime component to cover all hours worked, all Allowances and Penalties for Weekends and Call-Out Hours (excluding Shift Penalties, and the EDSD Payment).

Exception for 20% Loading Employees

Overtime can only be claimed for extraordinary and continuous periods of work due to major system failures, e.g. damage caused by storms or cyclones, where the period of hours worked is in excess of ten (10) hours each day for more than two (2) consecutive days. Overtime must be authorised in advance by an employee’s manager.

8.8.4 Market Component

Ergon Energy may apply a Market Component as a part of an IEA. Where applicable the Market

Component will be reviewed annually and adjusted effective from 1 July where necessary.

8.8.5 Performance Incentive

At Ergon Energy’s discretion an “at risk” performance incentive may apply. The Performance Incentive Scheme operates at Ergon Energy’s sole discretion and may be altered or discontinued at any time.

To be eligible for payment under the Performance Incentive Scheme employees are required to have been employed by Ergon Energy as at 30 June of the financial year for which performance is being assessed.

The “at risk” performance incentive (including any pro-rata amounts) will be reviewed annually and paid effective from 1 July as applicable.

Where an employee enters into an IEA inside of a twelve (12) month period prior to 30 June, the “at risk” component will be assessed and paid (if applicable) on a pro-rata basis.

Where an employee terminates due to redundancy, or due to ill-health a pro-rata payment of their potential “at risk” component will be payable.

8.8.6 Remuneration Increases

As a minimum, Employees on an IEA will receive annual wage increases to base salary in accordance with Clause 4.1 (Wage Payments) of this Agreement.

Further salary point progression within the grade for the position may occur if it is available and it can be demonstrated that additional skills and knowledge relevant to the position have been gained and are being utilised to an extent that warrants progression. This will be considered as a part of the employee’s performance review process.

8.8.7 Reversion

An employee who accepts an IEA may elect to revert to the general provisions of the Agreement by providing Ergon Energy with one (1) month’s written notice.

It is recognised that employees may make additional personal financial commitments while on an IEA. As such, where Ergon Energy requires an individual to revert to the general provisions of the Agreement, it will not do so without first providing the employee with three (3) months written notice.

On reversion, an employee will maintain their substantive classification and salary point at the time of reversion.

Any At-Risk and Market Component applied as a part of an IEA will cease from the effective date of the reversion.

8.8.8 Application

Where there is any inconsistency between an IEA and the Agreement, the terms and conditions of the IEA will take precedence to the extent of the inconsistency. Where the IEA is silent, the terms of the Agreement shall apply.

An IEA supersedes any prior employment agreement or arrangement of any type between Ergon Energy and an employee, including any other Agreements, oral or written, made prior to the execution of an IEA. However, this does not preclude Ergon Energy and an employee from agreeing in writing to additional terms that do not conflict with the provisions of this Agreement.

8.8.9 Exemptions

An employee on an IEA will be exempt from the following Agreement provisions: Annualised Allowance Clause 5.4

Bachelor Degree Allowance Clause 5.6

Availability Duty Allowance Clause 5.9

Employee in Charge Allowance [EIC] Clause 5.14

First Aid Allowance Clause 5.16

Tool Allowance Clause 5.18

Work in the Rain Clause 5.20

Overtime Clause 8.12

Crib Break & Overtime Meal Allowance Clause 8.13

8.8.10 Dispute Settlement

Any dispute or grievance concerning an IEA will be dealt with pursuant to the grievance and dispute settlement procedure contained in Part 2 of this Agreement.

8.9 AGGREGATED WORKING ARRANGEMENTS FOR AWAY WORK

This clause enables employees to access aggregated work arrangements for away work.

Where away work is scheduled for the periods identified below, the identified roster block options can be worked:

● Where away work is scheduled for more than a 4 week period – 14 day roster blocks

● Where away work is scheduled for more than a 6 week period – 21 day roster blocks

The identified working away arrangement and roster block will only be worked where it is mutually agreed, including an Agreement with a valid majority of the employees involved.

Notwithstanding the above, these working arrangements may also be applied in other circumstances, subject to mutual Agreement. The onus is on the employee/s to demonstrate the cost effectiveness of their request.

These working arrangements can only be applied to employees working a nine (9) day fortnight.

8.9.1 Roster Block Arrangements

Where the identified roster blocks are utilised, all identified roster block hours will attract an aggregate overtime loading to be paid in addition to an employee’s base rate of pay. The aggregate overtime loading is in lieu of any applicable overtime and weekend penalties for the identified roster block hours.

Any work required outside of the identified roster block hours will be paid at applicable overtime rates. The aggregate overtime loading will be included with the employee’s base rate of pay when calculating these overtime payments.

The aggregate overtime loading is not payable on an all purpose basis.

Employees participating in this roster block will work the identified hours and access the time off outlined in the work pattern.

The identified roster block period and hours are as follows:

Fourteen (14) Day Roster Block

● Work nine (9) consecutive days away from home, including a Saturday and a Sunday. Each work day will be ten (10) hours;

● On completion of the nine (9) days, have five (5) days off work at their home location;

● Employees will receive a loading of 28.5% for all of the identified hours worked within the roster block.

Twenty-one (21) Day Roster Block

● Work fourteen (14) consecutive days away from home, including identified Saturdays and Sundays. Each work day will be ten (10) hours;

● On completion of the fourteen (14) days, have 7 days off work at their home location:

● Employees will receive a loading of 34% for all of the identified hours worked within the roster block.

The hours reflected in these roster blocks should only be varied by Mutual Agreement subject to exceptional and critical operational circumstances.

The hours worked during these arrangements will be recorded on a standard Ergon Energy timesheet to ensure compliance with industrial legislation and any other relevant legislation (such as workers compensation).

The balance of time required to complete a project outside of fourteen (14) or twenty-one (21) day roster blocks, will be paid in accordance with the hours of work provisions of this Agreement and will not include the aggregated overtime loading.

8.10 BREAKS BETWEEN ROSTERED ATTENDANCES

The Parties agree that employees will be given no less than nine (9) consecutive hours off duty between the end of work on one day, and the commencement of work on the next.

If on the direction of Ergon Energy an employee resumes or continues work without having had nine (9) consecutive hours off duty, then they will be paid double time until released from work and given nine (9) consecutive hours off duty without loss of pay for ordinary working time occurring during such absence. Except where fatigue guidelines provide for a greater period.

Notwithstanding the above, in cases where an employee works overtime of at least 1.5 hours in aggregate between the hours of 11.00pm on one day and 5.00am on the next, then the nine (9) consecutive hour rest break will commence at the conclusion of the last period of work.

The arrangements outlined above also apply when overtime is worked on a Sunday, a Public Holiday or an RDO prior to a rostered work-day.

8.10.1 Extended Breaks

It is important to note that the safety of our employees is the most important issue and there may be circumstances where a nine (9) hour rest break may not be available or sufficient. Where a nine (9) hour break is insufficient due to fatigue, the employee may be provided with a longer break to ensure compliance with Ergon Energy’s fatigue guideline, as determined by the supervisor. If a break or longer break is taken and it goes into the normal starting time of the employee, the employee will not suffer a reduction in their ordinary pay for that period.

8.11 TIME OFF IN LIEU (TOIL)

Time Off in Lieu (TOIL) may be accrued for work performed outside of an employee’s normal work hours, subject to approval from their supervisor. The maximum amount of TOIL that may be accrued is forty (40) hours.

● Where an employee requests to work additional hours to bank as TOIL, such TOIL will accrue at time for time, being one (1) hour for each hour worked.

● Where Ergon Energy requests an employee to work overtime, the employee may request to accrue the time as TOIL. In this instance, TOIL will accrue at the prescribed penalty rate.

The taking of the TOIL will be at a time or times mutually agreed to with the supervisor. Subject to exceptional circumstances, where TOIL has not been taken within the agreed timeframe the employee will be paid out.

Time Off in Lieu (TOIL) will be administered at the local level by arrangement between the employee and their supervisor. When available these local arrangements will be administered electronically via timesheets. Each instance of TOIL will be documented showing the date/s, hours worked and TOIL accrued for future reference.

8.12 OVERTIME

Except as provided below, approved time worked in excess of that provided for in Clause 8.1 (Hours of Work) or before the ordinary starting time or after the ordinary ceasing time will be deemed overtime and will be paid for at one and a-half times the base rate for the first three (3) hours and double time thereafter. Each day will stand by itself when overtime is being calculated, except where an employee commences overtime on one day and continues to work such overtime into the next day.

No employee will refuse to work a reasonable amount of overtime to meet the needs of Ergon Energy.

Systematic overtime will not be worked; it will be considered such when three (3) consecutive weeks’ overtime has been worked. This arrangement will not apply when extra labour is not immediately available.

When any portion of an hour is worked, employees will receive payment in respect of any broken part of an hour at the current overtime rate with a minimum thirty (30) minute payment.

Where employees are required to report for work between midnight and 6.00am they will be paid at the rate of double time for all time so worked up to the ordinary starting time Monday to Friday and up to 7.00am Saturday.

If an employee cannot reasonably access their normal method of transport to or from their home due to working overtime, Ergon Energy will provide the employee with transport to or from their home or reimburse expenses incurred.

For those employees paid at Salary Point 15.0 or above, overtime will be calculated at the appropriate penalty rate for the hours worked and payment will be limited to the rate prescribed for Salary Point 15.0.

8.12.1 Weekends

Employees required to work overtime commencing on Saturday will be paid at one and a half times the base rate for the first three (3) hours and double time thereafter with a minimum period of three (3) hours work or payment, except in the case of emergencies.

All overtime performed on Sundays will be paid at the rate of double time.

Minimum payment for Sundays - When employees are called upon to work on a Sunday, they will, except in the case of emergency, receive a minimum of three (3) hours pay at double time.

8.12.2 Recalls

Except in the case of an emergency an employee who has been notified to work overtime prior to the normal commencement time on the following day, they will be entitled to a minimum of four (4) hours pay at the appropriate overtime rate.

A recall occurs when an employee is notified prior to commencement of work on the next day that they are required to work any day and the work cannot be performed during normal work hours and is not an emergency callout. Other than emergency work, if the employee is notified to perform overtime prior to the normal commencing time the following day a recall shall apply.

● Each recall is paid as a four (4) hour minimum at overtime rates.

● Where employees are required to report for work between midnight and 6 a.m. they will be paid at the rate of double time for all time so worked up to the ordinary starting time Monday to Friday and up to 7 a.m. Saturday.

● Employees recalled to work overtime, except in the case of an emergency, after leaving Ergon Energy’s business premises on Monday, Tuesday, Wednesday, Thursday or Friday (whether notified before or after leaving the premises) will be paid for a minimum four (4) hours work at the appropriate overtime rate for each recall.

Except in the case of unforeseen circumstances arising, an employee will not be required to work the full four (4) hours if the job the employee was recalled to do is completed within a shorter period. Overtime worked in cases where it is customary for an employee to return to Ergon Energy’s premises to perform a specific job outside of working hours, or where the overtime is continuous (subject to a reasonable meal break) with the completion or commencement of ordinary working time, will not be regarded as overtime for the purposes of this Clause.

8.13 CRIB BREAK & OVERTIME MEAL ALLOWANCE

When working overtime, for more than one (1) hour, employees will be allowed to take thirty (30) minutes for “crib” after the ordinary ceasing time, and also forty five (45) minutes after each four (4) hours work, provided such overtime continues, for which no deduction will be made.

All employees required to work overtime for more than one (1) hour will be paid the amount specified in the table below for each meal between the ordinary ceasing time and the completion of overtime work, unless Ergon Energy provides a reasonable meal for them.

When employees have provided themselves with customary meals because of receipt of notice of intention to work overtime, they will be entitled to an allowance as specified in the table below, for each meal so provided in the event of the work not being performed or ceasing before the respective meal times.

When employees work more than four (4) hours’ overtime on a Saturday and/or Sunday they will be entitled to a meal break of not more than one (1) hour at the end of the fourth (4th) hour, provided that their overtime is to continue for not less than one (1) hour after the meal break.

If such overtime continues to the tenth (10th) hour from the commencement of such overtime on such day, employees will be entitled to a further meal break of not more than one (1) hour provided overtime continues after the break.

Where such overtime continues after the tenth (10th) hour from the commencement of such overtime on such day, employees will be entitled to a further meal break (provided such overtime continues), of not more than one (1) hour after each additional five (5) hours until such time as such overtime is completed.

Employees called out will be allowed to take forty five (45) minutes for crib after each four (4)

hours overtime worked provided such overtime continues, for which no deduction will be made.

Employees called out prior to their normal rostered start time and who work for a minimum of one (1) hour with work continuing into their rostered start time, will be entitled to claim a meal allowance as specified in the table below and will be provided with a thirty (30) minute crib break as soon as possible thereafter. Employees who work for more than four (4) hours under the above circumstances will be entitled to a meal allowance and a forty-five (45) minute crib break in lieu of the thirty (30) minute crib.

Employees called out within one and a-half (1.5) hours of their normal ceasing time and who are required to work more than one (1) hour, will be entitled to a meal allowance as specified in the table below and in addition will be allowed thirty (30) minutes as soon as possible thereafter, without deduction of pay, to partake of a meal.

The overtime meal allowance will be indexed in accordance with the increases contained in thisAgreement and will be applied as follows:

Effective Date	Meal Allowance
1st October 2011	$12.90
1st October 2012	$13.35
1st October 2013	$13.82

8.14 START AND FINISH ON THE JOB

Start and Finish at a Worksite

The Parties acknowledge that start and finish on the job arrangements will provide greater flexibility and productivity through maximising the time spent on the worksite.

The Parties agree that where appropriate and where mutually agreed, affected employees will start and finish on the work site. To facilitate any new arrangements, the Parties involved in the relevant business unit consultative forums will negotiate, develop and agree on suitable guidelines for implementation at a regional or depot level. Any such arrangements will be in accordance with the process outlined in the Flexibility Clause of this Agreement, prior to any implementation.

Notwithstanding the above, employees engaged on projects and single location work packs in excess of two weeks, and employees engaged in the customer service areas may be required to start and finish on the worksite from time to time as required. Ergon Energy will consult with directly affected employees and determine the suitability of the arrangements based on operational requirements and consideration for the employee's personal circumstances.

Employees required to start and finish on the worksite in accordance with this arrangement will be provided access to an Ergon Energy vehicle for transportation. This vehicle will be appropriate to the work being undertaken as determined by Ergon Energy.

The time spent travelling to the worksite will be in an employee’s own time up to a fifteen (15) kilometre radius from their designated place of work (i.e. depot or office). Where the worksite is situated in excess of the fifteen (15) kilometre radius from their designated place of work, the period of time spent travelling outside of the fifteen (15) kilometre radius and before the employee’s normal starting and finishing time will be paid at travel time.

The start and finish on the job arrangements are subject to the following conditions:

● Barring unforseen circumstances, the employees have an obligation to start and finish on the worksite at their normal rostered commencing and ceasing time, unless directed otherwise.

● Travel to and from the worksite is by the most direct route;

● Notwithstanding Ergon Energy’s policy relating to the garaging of Ergon Energy motor vehicles, an employee will not be held accountable for any loss provided they have taken all reasonable precautions to secure the vehicle i.e. locked vehicle doors and equipment boxes.

● An employee who because of local authority restrictions is unable to park a particular vehicle on or near their residence, will not be required to take this type of vehicle home for the purposes of this clause.

● An employee has an obligation to report to their designated place of work if Ergon Energy cannot source alternative transport to enable an employee to start and finish on the worksite (e.g. due to unavailability of a vehicle).

The travel time payments referred to in this particular clause do not apply where an employee is required to start and finish from their normal designated place of work (in accordance with the Travel Time provisions of this Agreement).

Ergon Energy may terminate this arrangement with a minimum of one (1) month written notice. An employee may request to terminate this arrangement where there are genuine personal circumstances impacting their ability to start and finish on the job.

The above arrangements will apply to any existing start and finish on the job local arrangements in customer service areas.

 1   [2012] FWAA 2175.

 2   Ergon Energy Union Collective Agreement 2011, Clause 1.3.

 3   Ibid. Clause 8.7.3.

 4   Clause 3 Schedule 3 Redundancy Provisions dot point 6 thereof.

 5   Submissions of the ETU Exhibit?

 6   Osborn’s Concise Law Dictionary, (Sweet & Maxwell, 11th ed) p.200. generalia specialibus non derogant. [General things do not derogate from special things].

 7 [2014] FCA 32.

 8   Recommendation, 30 October 2013, Deputy President Asbury [11], [55].

 9 [(1996) 66 IR 182].

 10   AMWU v Silcar Pty Ltd [2011] FWAFB 2555.

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