Kim Lock v Ergon Energy Corporation Limited

[2009] FWA 699

[2009] FWA 699

FAIR WORK AUSTRALIA

DECISION

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

Kim Lock
v
Ergon Energy Corporation Limited
(C2009/10226)

COMMISSIONER LARKIN SYDNEY, 21 OCTOBER 2009

Alleged dispute concerning the unsatisfactory redeployment of an ASU member and her entitlement to retrenchment benefits as outlined in Clause 10, Schedule 2 of the Ergon Energy Certified Agreement 2005.

[1] On 11 August 2009 the Australian Services Union (ASU) lodged an application under s.739 of the Fair Work Act 2009 (the Act), for Fair Work Australia (FWA) to deal with a dispute in accordance with a dispute settlement procedure, on behalf of its member, Ms Kim Lock (the applicant). The dispute was said to be between Ms Lock and her employer, Ergon Energy Corporation Limited (Ergon), in relation to Part 9 and Schedule 2, clause 9 of the Ergon Energy Certified Agreement 2005 (the 2005 agreement). The relief sought was outlined in the application as follows:

“As per section 739 of the Fair Work Act 2009 the Australian Municipal, Administrative, Clerical and Services Union requests that Fair Work Australia arbitrates this matter and orders Ergon Energy to pay Ms Lock retrenchment benefits as outlined in clause 10 of Schedule 2 of the Ergon Energy Certified Agreement 2005, as Ms Lock has in fact advised Ergon Energy that that (sic) the alternative position is unsatisfactory.”

[2] A conference was convened with the parties on 25 August 2009, however, the matter did not settle on that occasion.

[3] On 2 September 2009 Mr Montgomery from Ergon forwarded the following correspondent to Ms Sheppard of the ASU:

“The purpose of this letter is to confirm that Ergon Energy has again reviewed its position, the circumstances surrounding Ms Lock’s request for retrenchment benefits and the matters raised at the conciliation conference with Commissioner Larkin and that our position remains unchanged.

As outlined in previous correspondence to Ms Lock and at the conciliation conference, there is an ongoing requirement in the business for Ms Lock’s nominal role. Ergon Energy also confirms that suitable alternative employment has been provided to Ms Lock upon redeployment from Ergon Energy Pty Ltd to Ergon Energy Corporation Limited and that Ms Lock did not within three (3) months of being redeployed advise that the alternative position is unsatisfactory.

Ms Lock’s period of parental leave ceased on 27 August 2009 and whilst an extension to this was given subject to the particular position being reconsidered, Ergon Energy’s expectations are that Ms Lock will return to her nominal position. Ergon Energy intends to convene a meeting with Ms Lock to confirm with her return to work arrangements.”

[4] Following the above correspondence the ASU sought a re-listing of the matter in dispute.

[5] On 11 September 2009 Ergon forwarded correspondence to FWA, which, inter alia, stated:

“…upon reviewing the application made by the Australia Services Union and the provisions relied upon by them under the Ergon Energy Collective Agreement 2005 with respect to this matter, Ergon Energy requests that Fair Work Australia determine jurisdiction to hear this application as per the attached submission.”

[6] Ergon’s jurisdictional objection to FWA dealing with the application was listed and heard on 21 September 2009. Appearances at the hearing were Mr Montgomery, Senior Industrial Relations Advisor for Ergon and Ms Sheppard of the ASU on behalf of the applicant.

BACKGROUND

[7] In the application under s.739 of the Act the ASU set out the background to the dispute. Prior to the conference before FWA, on 25 August 2009, Ergon also provided a background to the dispute. While the parties disagree on a number of issues in relation to the substantive matter the chronology of events appear, on my view, not to be substantially contested.

[8] For the purpose of the jurisdictional objection raised, the following is a summary of history to the matter before me.

• April 2006 Ms Lock commenced employment with Ergon.



• July 2006 Ms Lock was advised that the area/department in which she worked was to be sold. Ms Lock requested redeployment within Ergon Energy Corporation Limited.



• August 2006 Ms Lock is redeployed from Ergon Energy’s retail business unit (EEPL) to Ergon Energy Corporation Limited, as an Operations Officer. The parties are in dispute as to whether this was an interim or substantive position, which is not relevant for the purpose of this decision.



• January 2007 Ms Lock was advised of a change in the reporting relationship and work group effective 2 April 2007.



• March to July 2007 Ms Lock was seconded to the Full Retail Contestability project (FRC) as an FRC project officer.



• July 2007 Ms Lock returns to the Operations Officer role.



• August 2007 Ms Lock commences maternity leave.



• October 2007 Ms Lock requested an extension of her original maternity leave period.



• January 2008 Ms Lock’s request was approved for special leave without pay commencing August 2008 to January 2009.



• May 2008 Ms Lock requests voluntary redundancy (VR). Ms Lock is advised by Human Resources that her request was not approved.



• June 2008 Ms Lock was provided with a formal response from Mr Newman, General Manager Services Operations, that her request was outside the three month period to advise that the alternative position was not satisfactory. Ms Lock discusses her request, by telephone and email, with Mr Newman.



• July 2008 Ms Lock is advised, formally, that her VR request had been referred for consideration.



• February 2009 Ms Lock is advised that her request of 2 February 2009 to extend her unpaid parental leave to 27 August 2009 had been approved.



• 16 March 2009 meeting held with Ms Lock, the ASU, HR Officer and Senior IR Advisor to “discuss voluntary retrenchment and updated position profile. Position title amended from Operations Officer to Service Transaction centre Officer”. 1



• 17 March 2009 Ms Lock requests, by email, that Ergon’s Chief Executive, Mr McLeod, consider the circumstances of her request for VR.



• May 2009 Mr McLeod formally responded to Ms Lock’s request and advises that her application is not approved. Ms Lock emails Mr McLeod seeking further consideration of her request.



• June 2009 Ms Lock is provided formal correspondence from Mr McLeod confirming that no entitlement exists for VR.



• August 2009 Ergon Human Resources contact Ms Lock in relation to her return to work and a meeting is scheduled for 21 August 2009.



• 11 August 2009 “Dispute notification received from ASU in relation to Kim Lock seeking retrenchment benefits”. 2



• 21 August 2009 discussions are held between the parties, which Ergon, in its summary, state were concerned with Ms Lock’s arrangements for return from parental leave on 27 August 2009.

CONSIDERATIONS

[9] The jurisdictional objection raised by Ergon relates to Ms Lock’s application under s.739 lodged on her behalf by the ASU with FWA on 11 August 2009, which stated the relevant instrument as the Ergon Energy Certified Agreement 2005 at Part 2, dispute settlement procedure.

[10] Ergon filed submissions on the jurisdictional argument on 11 and 18 September 2009. Those submissions were substantially in the same/similar terms. Ergon stated that, while the Ergon Energy Union Collective Agreement 2008 (the 2008 agreement) is in force, at the time of Ms Lock’s redeployment and at the time of her initial request for voluntary redundancy the 2005 agreement applied. The submission of 11 September 2009 continued:

“3. Upon commencement of the legislative changes on 27 March 2006 and the transitional treatment of state employment agreements, the EECA 2005 became a federal industrial instrument known as a “Preserved Collective State Agreement”.

4. Pursuant to section 15A of Schedule 8, Part 2, Division 2 of the Workplace Relations Act 1996 (WR Act) Volume 2 (Appendix 2) –

(1) A preserved collective State agreement is taken to include a term requiring disputes about the application of the agreement to be resolved in accordance with the model dispute resolution process.

(2) Any term of the preserved collective State agreement that would otherwise deal with the resolution of those disputes is void to that extent.

5. Relevantly, the ‘model dispute’ settlement process pursuant to WR Act that displaces the grievance and dispute settlement procedure at Clause 2.1 of the EECA 2005, does not provide the Commission with powers of compulsory arbitration (Appendix 3).

6. In accordance with section 739 (3) of the FW Act, in dealing with a dispute Fair Work Australia (FWA) must not exercise any powers limited by the term dealing with dispute resolution.

7. On this basis, Ergon Energy submits that FWA is not empowered to compulsory arbitrate in relation to the matter brought by the ASU under the EECA 2005 pursuant to the ‘model dispute’ settlement procedure.

8. Ergon Energy requests that prior to FWA listing this matter for arbitration that FWA determine jurisdiction to hear this application subject to the transitional treatment of the EECA 2005.”

[11] At points 9 and 10 of the Ergon submission of 18 September 2009 the following was argued:

“9. Notwithstanding the above submission, Ergon Energy submits further that FWA cannot retrospectively apply the dispute resolution process pursuant to the current EEUCA 2008 to a matter arising under the terms of the EECA 2005 and subject to the ‘model dispute’ settlement process and that to do so is inconsistent with the laws applying at the time and is prejudicial to Ergon Energy.

10. Referring to the ASU’s application (see Attachment 10), it is clear that the key dates relied upon by the ASU in seeking assistance from FWA occur prior to the certification of the current EEUCA 2008. This is further supported by the ASU’s acknowledgment in their application that the industrial instrument that applies is the EECA 2005.”

[12] The 2008 agreement was lodged with the Workplace Authority on 22 September 2008 and on my understanding was approved by that authority.

[13] The dispute settlement procedures in the 2005 agreement, as they were prior to March 2006 when the 2005 agreement became a preserved collective state agreement, were similar if not the same terms as now found in the parties’ 2008 agreement. Those dispute settlement procedures provide that if a grievance or dispute remains unsolved it may be referred to the Australian Industrial Relations Commission, now Fair Work Australia, for resolution providing the parties have genuinely attempted to reach a resolution during the internal resolution process. 3

[14] The ASU submitted:

“The Australian Services Union note Ergon Energy’s submission but we believe that though the dispute has been ongoing from July 2006 it was on 14 May 2009 that Mr Ian McLeod, the CEO, advised that our member’s request for redundancy had been refused. It is our belief that the letter of 14 May was the trigger for the dispute to be lodged and the dispute procedure that is currently in force should apply.” 4

[15] I agree with the ASU submission on the point.

[16] The issue of Ms Lock’s request for voluntary redundancy commenced in May 2008. In June 2008 Ergon refused to approve that request. Ms Lock continued to seek a review of the Ergon position throughout 2008 and 2009. In July 2008 Ms Lock was advised that her VR request had been referred for consideration.

[17] In March 2009 Ms Lock, with her union the ASU, met with Ergon management to discuss voluntary retrenchment and an updated position profile for her role in the organisation. It was not until June 2009 that Ms Lock was formally and finally advised by Mr McLeod that:

“…no entitlement exists for voluntary redundancy, on the basis that there is an ongoing requirement in the business for the position she currently holds and that she did not within 3 months of redeployment to alternative employment advise Ergon that she found the position unsuitable.” 5

[18] The present argument before me concerns FWA’s jurisdiction to deal with a dispute notified under s.739 of the Act lodged with FWA on 11 August 2009 to settle a dispute in accordance with the parties’ dispute settlement procedures in an agreement. At the time the matter in dispute was notified to FWA the 2008 agreement was in operation and remains in operation.

[19] The subject matter of the dispute concerns redundancy provisions. Those provisions are in the same terms as contained in the 2008 agreement at Schedule 3, clause 10, redeployment as they were in the 2005 agreement.

[20] Mr Montgomery may be correct that the matter in question did not arise under the 2008 agreement, however, in my view the dispute did. Mr Montgomery put the following argument:

“Yes, Commissioner, the argument from Ergon Energy with respect to reliance upon the 2008 agreement is that the matter in question did not arise under the 2008 agreement, it arose under the 2005 agreement. Ms Lock originally requested a voluntary retrenchment on 19 May 2008. That’s prior to the Ergon Energy Union Collective Agreement of 2008 being registered and certified. In saying that her formal request was actually declined by Mr Alan Newman on 27 May 2008. Ms Lock again then requested or put forward additional information with request to her claim for VR and I haven’t got the dates in front of me, Commissioner, I apologise, but was also given a formal decline as well.

Mr McLeod, the chief executive of Ergon Energy was probably the last on the chain or second last, Mal Leech, general manager employee and shared services also responded. That brings I suppose what I’m raising four different times Ms Lock had been advised that her request for a VR hasn’t been approved. The question would be I mean if you keep asking for a VR in terms of an entitlement arising under an 05 agreement it shouldn’t enact a dispute resolution clause under the 08 where it would prejudice Ergon Energy with respect to the transitional provisions of the Workplace Relations Act. It’s very clear that the dispute resolution process in the 05 agreement is void and cannot be relied upon. That’s obviously the first in terms of the submissions from the ASU under that agreement.” 6

[21] At any stage in the parties’ communication process Ms Lock may have been successful in her submission to her employer in relation to her request for voluntary redundancy. It was only when Ms Lock received the Chief Executive’s, Mr McLeod, formal refusal that the ASU lodged a dispute notification under s.739 of the Act with FWA and Ergon on 11 August 2009.

[22] It is doubtful, albeit I have no evidence on the point, the jurisdictional challenge before me would have arisen if the ASU had relied upon the current dispute settling provisions of the 2008 agreement. Ms Shepherd outlined how the matter was lodged with FWA relying upon the provisions of the 2005 agreement as follows:

“It was actually lodged by an industrial officer who lodged under the provisions that she thought it was the 2005 is my guess. Unfortunately she doesn’t work for us any more so I am unable to clarify with her specifically.” 7

[23] In my view the parties were in dispute when the ASU on 11 August 2009 notified FWA and Ergon that a dispute existed.

[24] In submissions the ASU sought to rely upon the provisions of the 2008 agreement as opposed to the 2005 agreement as outlined on the application. FWA has discretion to correct and amend an application under the provisions of s.586 of the Act, as follows:

“FWA may:

(a) allow a correction or amendment of any application, or other document relating to a matter before FWA, on any terms that it considers appropriate; or

(b) waive an irregularity in the form or manner in which an application is made to FWA.”

[25] I have had regard to Mr Montgomery’s submission of prejudice to Ergon if I allow the ASU application to be amended to rely upon the provisions of the 2008 agreement. However, the same can be said of Ms Lock’s situation if I do not. Ms Lock’s substantive application has not be heard and determined. Ms Lock may or may not be successful in persuading FWA that she has an entitlement to a voluntary redundancy payment under the terms of the 2008 agreement. In my view, Ms Lock is entitled to have her matter heard and determined.

CONCLUSION

[26] In conclusion, I am satisfied that FWA does have jurisdiction to hear and determine the s.739 application lodged by the ASU on behalf of its member Ms Lock.

[27] I am satisfied that the parties were in dispute in June 2009 when Ergon’s Chief Executive Officer advised Ms Lock that she did not have an entitlement to voluntary redundancy and the ASU lodged an application on 11 August 2009 for FWA to deal with a dispute pursuant to s.739 of the Act.

[28] I accept that there was an error in that application and pursuant to s. 586 I am satisfied that I should allow an amendment to that application to identify the 2008 agreement, which includes a term that provides a procedure for dealing with disputes as required by s.738 of the Act.

[29] The substantive application will be listed for hearing in due course.

COMMISSIONER

Appearances:

Ms J Sheppard, Australian Services Union, for the applicant.

Mr B Montgomery for the respondent.

Hearing details:

2009.

Sydney, with video link to Brisbane:

September, 21.

 1   Ergon’s summary to FWA on 24 August 2009 at page 4.

 2   Ibid at page 5.

 3   See Part 2, Grievances and Disputes, of the 2008 agreement.

 4   PN53.

 5   Ibid.

 6   PN105; PN106.

 7   PN120.

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