The Australian Workers' Union v Alcoa of Australia Limited

[2013] FWC 816

[2013] FWC 816

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

The Australian Workers’ Union
v
Alcoa of Australia Limited
(C2012/4853)

COMMISSIONER JONES MELBOURNE, 3 APRIL 2013

Settlement of Disputes Procedure - Classification of tapping crew member at Point Henry Smelter.

Introduction

[1] The Australian Workers’ Union (the Union) has made an application pursuant to section 739 of the Fair Work Act 2009 (the Act) for the Fair Work Commission (FWC) to deal with a dispute in accordance with the disputes procedure contained in the Alcoa Point Henry Smelter and Anglesea Power Station Agreement 2011 (the Agreement).

[2] On 1 January 2013, Fair Work Australia was renamed the Fair Work Commission. In this decision I have referred to the Fair Work Commission (FWC) which incorporates reference to Fair Work Australia as it was known prior to 1 January 2013.

[3] The dispute concerns the proper classification of Mr Millar Irvine, a Smelter Operator, employed by Alcoa of Australia Limited (Alcoa) at the Point Henry site. Specifically the issues in dispute are whether the work performed by Mr Irvine meets the skills and knowledge competencies specified in clause 1.16 of Appendix A of the Alcoa Point Henry Smelter and Anglesea Power Station Award 2003 (the Award) and whether clause 8(a)(iv) of the Agreement applies in relation to Mr Irvine’s claim for reclassification as a Team Leader.

Background

[4] Alcoa owns and operates an aluminium smelter at Point Henry, Geelong, Victoria.

[5] Alcoa utilises a technique known as electrolytic extraction in the production of aluminium. This technique involves the separation of aluminium into its component parts of aluminium metal and oxygen by electrolytic reduction. Electrolytic extraction occurs in three pot line houses comprising in total 368 smelting pots. The smelting pots on each pot line are large carbon or graphite lined steel smelting cells connected electrically in a series to form a single pot line.

[6] The alumina is fed into the smelting pots and is dissolved in aluminium fluoride or ‘bath’. A high electric current is then passed through the smelting pot at low voltage via carbon anodes. This enables the alumina solution to split into components of aluminium and oxygen. The oxygen reacts directly with the carbon anode, which gets consumed to form carbon dioxide that bubbles away, whilst the aluminium collects at the bottom of the pot. The aluminium is then siphoned from the bottom of the pot using a crucible and is then transferred to the Alcoa Australia Rolled Products ingot mill for casting (which is located next door to the Pot Rooms). The process of siphoning the aluminium is known as ‘tapping’ and is performed by a ‘Pot Room Operator’.

[7] Each pot contains 24 carbon anodes which are replaced approximately every 22.5 days. The process of replacing the carbon anodes is referred to as ‘setting’ and is performed by a Pot Room Operator.

[8] Mr Irvine commenced employment with Alcoa on 16 December 1994. He performs tapping work on Pot Line 1 and is classified as a Level 5 Operator.

[9] The terms and conditions of employment of Mr Irvine are governed by the Agreement and the Award.

[10] Clause 8(a) - Rates of Pay - of the Agreement relevantly provides:

(iii) Subject to paragraph (a)(iv) below, placement of employees within and progression through the classification structure is determined by the successful acquisition and utilisation of the skill and knowledge competencies specified. The classification structure and associated job descriptions are set out in sub clause 21.1 and Appendices A and B of the Award.

(iv) Promotion into the Point Henry Equipment Manager, Process Controller and Operating Team Leader positions and the Anglesea Scheduler and M4 positions will be by vacancy and appointment only.

[11] Appendix A, Part 1 of the Award sets the classification and job descriptions of Smelter Operators, Team Leaders and Process Controllers at the Point Henry site. For convenience, the classification 1.16 Team Leader is extracted in full and attached to this decision (Attachment A).

[12] The Agreement came into effect on 27 August 2011.

Submissions

AWU

[13] In summary, the AWU case is as follows:

a) Negotiations with management occurred in or around 2007-2008 regarding proposed restructure of tapping crews in the Respondent’s Point Henry Pot Rooms;

b) The restructure involved reducing the number of tappers on each crew from three to two;

c) Agreement was reached between the AWU Senior Site Delegate, Mr Brett Noonan, and Mr Michael Hermecz, Pot Room Manager, that:

(i) The number of tappers on each crew would be reduced from three to two;

(ii) Each crew would have two Leading Hand/Level 6 employees; and

(iii) Each tapper would be paid at the Level 6 rate of pay.

d) Mr Irvine was at the time working as a tapper at the Point Henry smelter;

e) Mr Irvine performs the same work as other tapping crew members;

f) All tapping crew members are paid at the Level 6 rate of pay except for Mr Irvine; and

g) Given the agreement reached, clause 8(a)(iv) of the Agreement does not apply.

Alcoa

[14] Alcoa’s submissions are in summary:

a) Not all tapping crew members are paid at the Level 6 rate; the shift rosters demonstrate that there are tapping crew members who are paid at the Level 4 and 5 classification rate;

b) There was no agreement between Alcoa and the AWU in 2006 that members of the tapping crew (whose numbers were reduced from three to two) would all be paid at the Level 6 rate;

c) Mr Irvine does not perform the same work as tapping crew members paid at Level 6 rate;

d) Mr Irvine does not meet or perform work in accordance with the skills, knowledge and competencies specified at Level 6 of the classification structure of the Award; and

e) Furthermore, as there is no agreement, Clause 8(a)(iv) of the Agreement applies.

Issues to be determined

[15] Clause 8(a) of the Agreement sets out the general principles applicable to pay rates and other payments, the working of additional hours, classification of employees, promotion of employees into positions including Operating Team Leader.

[16] Sub-clause 8(a)(iii) of the Agreement requires that the classification of employees is determined by the successful acquisition and utilisation of skills and knowledge competencies specified in the Award.

[17] This provision is subject to sub-clause 8(a)(iv) of the Agreement which applies where classification concerns promotion to Point Henry Equipment Manager, Process Controller and Operations Team Leader. In such circumstances, promotion ‘will be by vacancy and appointment only’.

[18] It follows that in the placement of employees and progression through the classification structure, an employee must have successfully acquired and utilised the relevant skills and knowledge competencies. This is the first step to be followed.

[19] Once satisfaction is reached that the Operator satisfies the Level 6 requirements, sub-clause 8(a)(iv) has effect; namely that the promotion is by vacancy and appointment.

[20] Consequently, the issues to be determined are:

a) Whether Mr Irvine has successfully acquired and utilises the skills and knowledge competencies specified at Level 6 of the classification structure for Smelter Operators in Appendix A, Part 1 of the Award;

b) If Mr Irvine has acquired and utilises the relevant skills and knowledge competencies, whether there was an agreement reached around 2007-2008 that members of the tapping crew employed by Alcoa at its Point Henry Smelter would, in circumstances where the crew numbers were reduced from three to two, be all paid at Level 6 of the Classification Structure for Smelter Operators in Appendix A, Part 1 of the Award; and

c) If there is such an agreement, whether clause 8(a)(iv) of the Agreement applies to Mr Irvine’s employment.

Was there an agreement?

Evidence

[21] Mr Brett Noonan is the Senior Site Steward at the Point Henry Smelter and has occupied this position for a period of 12 years.

[22] His evidence is that in or around 2007 to 2008 he was involved in negotiations with Mr Michael Hermecz, the then Pot Room Manager, regarding manning of tapping crews. At that time each crew comprised three Pot Room Operators, two of whom were Leading Hand classification. Arising out of the discussions, an agreement was reached to reduce the manning of the crew from three to two, with each member of the two man crew being paid at Level 6 (Team Leader). A result of the reduction in numbers was that the overhead crane was operated remotely. Mr Irvine was a tapper at the time. Mr Noonan assumed, as a result of the agreement, that all members of the tapping crew were paid at Level 6. 1

[23] The agreement was an oral agreement. Mr Noonan stated there was a minute recording this agreement. However, this minute was not placed in evidence. 2

[24] A statement of Mr Hermecz was filed by Alcoa; however Mr Hermecz was not available for cross examination. It appears the reason for this being his current location in Saudi Arabia. 3 In the statement Mr Hermecz denies any discussions or agreement was reached with Mr Noonan regarding the payment of tapping crew members at Level 6 as part of the reduction in manning numbers.

[25] An issue that was subject to dispute was the submissions by the Applicant that all tapping crew members other than Mr Irvine were paid at Level 6 reflecting the agreement reached.

[26] Mr Dorsey, Site Shift Group Leader, gave evidence that there presently were members of tapping crews on various shifts who were paid at Level 3 to Level 5. Each of these employees had commenced employment with Alcoa in 2008 or earlier. 4

[27] Mr Noonan’s evidence, which was generally undisputed, was that these employees were paid at rates less than the Level 6 rate because they were either in training, rotating in and out of the tapping crew, on medical restrictions or subject to disciplinary action. He maintained two of the employees were Level 6 employees. 5 Mr Noonan stated that none of the other employees were permanent tappers like Mr Irvine.6

[28] It is apparent from the cross examination of Mr Noonan, and the evidence of Mr Dorsey, that some of the tapping crew members in question have performed tapping duties for periods less than 12 to 18 months, some for periods in excess of 5 years. 7

Consideration

[29] Alcoa submit there was no oral agreement relying on the statement of Mr Hermecz. They point to absence of any written record and the fact that subsequent enterprise agreements do not reflect this agreement. Further they submit the fact that current tapping crew members are paid at levels less than Level 6 support their submission.

[30] Although a reasonable explanation was provided for the unavailability of Mr Hermecz to be cross-examined, I prefer the evidence of Mr Noonan, who gave his evidence in a straightforward manner and was cross examined.

[31] I am satisfied there was an oral agreement reached between Mr Hermecz and Mr Noonan that in return for the reduction of tapping crew size from three to two, the then permanent tapping crew members would be paid at Level 6 or Team Leader rate of pay.

[32] Such an agreement makes industrial sense and, given it was to apply to the then tapping crew members, it was unnecessary for this agreement to be recorded in subsequent enterprise agreements.

[33] I am satisfied that there were explanations for the varying levels at which current tapping crew members are paid which do not militate against a finding that an agreement was reached.

[34] It flows from this that, as there is no dispute that Mr Irvine was a tapper and member of the tapping crew at the time of the agreement, the failure to pay Mr Irvine at Leading Hand rate was not in accordance with the agreement.

[35] However, the agreement has no statutory force. The consequence is that, as Mr Irvine is classified as a Level 5 Operator, the claim for the classification of Mr Irvine at Team Leader, Level 6 position can only be dealt with by the Commission by arbitration in accordance with the provisions of sub-clauses 8(a)(iii) and (iv) of the Agreement.

Classification structure

[36] In determining Mr Irvine’s claim for reclassification at Level 6 (Team Leader), there are two steps which flow from the operation of sub-clauses 8(a)(iii) and (iv) (see [18] and [19]). The first step is whether Mr Irvine has successfully acquired and utilises the skills and knowledge competencies specified at Level 6. If the finding is positive, then sub-clause 8(a)(iv) is called into operation. In the circumstances of this dispute, the issue is whether, given the existence of the agreement (see at [31]), sub-clause 8(a)(iv) applies. If, however I find that Mr Irvine has not successfully acquired and utilises the skills and knowledge competencies specified at Level 6, then it is unnecessary to consider the application of clause 8(a)(iv) as it is not called into operation.

Evidence

[37] For the purpose of the proceedings, Mr Dorsey conducted an assessment of Mr Irvine’s skills and knowledge competencies against those specified in Level 6. Other than having had 5 years experience as a Smelter Operator, Mr Dorsey’s assessment was that Mr Irvine did not meet and/or was not performing any of the criteria specified in Level 1.16.1 to 1.16.14. 8 Mr Dorsey stated that it was his firm view that Mr Irvine did not meet the skills and knowledge competencies specified in clause 1.16 of Appendix A of the Award.9

[38] Mr Irvine’s evidence is that whilst he believes he is a “fully qualified and high performing Smelter Operator with at least 5 years experience” as specified in clause 1.16.1 of Appendix A of the Award, he does not perform the tasks specified in clauses 1.16.2 and 1.16.3. 10 He stated that he does not have “any hope of achieving the rest of the criteria, not without training anyway”.11

[39] Mr Irvine stated that he performs exactly the same tasks and has the same responsibility as his crew partner, Mr Dale, who is classified as Level 6. 12

[40] A statement of Brett Dale was tendered in evidence. 13 However, Mr Dale was not available to be cross-examined and a reasonable explanation for his absence was not given.

[41] In evidence, was an offer, dated 9 August 2007, from Alcoa Pot Room Manager to Mr Dale of a position Team Leader, pay Level 6. 14 Mr Dorsey stated that the custom and practice at Point Henry Pot Room was that where a person is appointed to the position of Team Leader this is recorded in writing. He stated that these records are in the same terms as the offer to Mr Dale.15 Mr Dorsey stated that he believed the signature on the offer was Mr Dale’s signature.16 Attached to the offer was a document entitled, ‘Leading Hand and PC Leadership Accountabilities and Responsibilities’. Mr Irvine stated in cross examination that Mr Dale performed accountabilities and responsibilities specified in the attachment relating to safety, instructions, work planning and communication.17

[42] Alcoa referred to performance issues recorded in Mr Irvine’s personnel file. 18 The most recent record of a performance issue is dated 22 August 2009. The evidence is that Alcoa did not take steps to train or assist Mr Irvine in the areas in which his performance was deficient.19 Given the lapse in time since the last performance records, I have not taken these records into account in my decision.

Consideration

[43] The undisputed evidence is that Mr Irvine has not successfully acquired or utilises the skills and knowledge competencies in clauses 1.16.2 to 1.16.14.

[44] Given the undisputed evidence, I find that Mr Irvine has not successfully acquired or utilises the skills and knowledge competencies specified in the classification Level 6, Team Leader, in the Award.

[45] As a consequence of this finding, sub-clause 8(a)(iv) of the Agreement does not come into play and it is therefore unnecessary to determine whether the agreement reached between Mr Noonan and Mr Hermecz applies to that sub-clause.

COMMISSIONER

Appearances:

Mr C. Winter, appearing on behalf of the Australian Workers’ Union.

Mr P. Wheelahan, of cousel, appearing on behalf of Alcoa of Australia Limited.

Hearing details:

2013

March 22

Melbourne

Attachment A

Appendix A, Alcoa Point Henry Smelter and Anglesea Power Station Award 2003

1.16 Team Leader

1.16.1 The Company will determine the number of Team Leader positions in each Operating Area depending on the number and configuration of shift crews. The Company will seek to consult with employee representatives when determining the number of Team Leader positions. Promotion into one of these positions will be by vacancy and appointment only. Fully qualified and high performing Smelter Operators with at least 5 years experience will normally fill any vacancies. However, other persons with at least equivalent experience and competencies may be appointed at the discretion of the relevant Departmental Manager.

1.16.2 The Team Leader must assist the relevant shift supervisor in the ongoing management of all shift accountabilities associated with the entire process within his or her dedicated functional area (e.g. tapping, setting, pot-lining) and in ensuring that all shift schedules and targets are met in a safe and efficient manner. More specifically, he or she must assist the supervisor in coordinating daily work schedules, “walking the flow” on an ongoing basis and, in general, ensuring that all tasks are undertaken on the shift and that all problems/issues are resolved or otherwise appropriately addressed.

1.16.3 Where the supervisor is unavailable or absent, the team Leader must take accountability for the management and performance of the process (including the management of all relevant systems and equipment). This is particularly important in regard to shift start up, ongoing overseeing of work and ensuring the effective flow of information.

1.16.4 As part of this support role, team leaders will attend departmental production and process related meetings as required as well as assist in the handover to the incoming shift supervisor. This involves the preparation and provision of metrics, other information and documentation on key process activities, any problems or issues encountered on the shift and deviations from work schedules.

1.16.5 Team leaders must also support the shift supervisor and the OH&S representative in conducting shift safety meetings and in ensuring that all safety and environmental activities are undertaken. This includes the monitoring of relevant waste management systems.

1.16.6 Apart from providing support to the shift supervisor as specified above, team leaders are primarily accountable for the day to day planning, scheduling, coordination and monitoring of all work activities and manning requirements associated with their crew. They are also accountable, in the first instance, for managing people related issues or problems that may arise on a shift. In short, they are responsible for ensuring that the crew works effectively and cohesively as a team, performs to the standards required and meets all targets set.

1.16.7 Consistent with the above accountabilities, the team leader has responsibility for ensuring that auditing activities (e.g. process, production, technical, safety and environment) are appropriately and fully undertaken in a designated area at the direction of his or her supervisor. This would include the regular updating of audit boards and the timely conducting of audits.

1.16.8 In undertaking this role, team leaders must effectively liaise, communicate and interact with a wide range of other groups, including shift supervisors; technical resources and engineers; other team leaders, process controllers and smelting operators; tradespersons and equipment managers; as well as external suppliers and maintenance/engineering contractors.

1.16.9 The Team Leader must provide direct leadership and developmental support for the shift crew. He or she is responsible for:

● Mentoring and developing their crew members;

● Scheduling and monitoring the training modules undertaken by crew members;

● Undertaking competency evaluations in conjunction with Shift Supervisors; and

● Directly conducting training, where appropriate.

1.16.10 Consistent with this leadership role and their high level of technical competence, the Team Leader also provides the first level of technical support in the “shift help chain” for the Team.

1.16.11 The incumbent must be totally proficient in the use of all relevant production and maintenance systems necessary for the achievement of daily, monthly and longer term manufacturing targets. He or she must ensure that all performance metrics relevant to the designated area are continually and accurately updated and effectively communicated.

1.16.12 Consistent with their role, Team leaders are required to exercise a high level of decision making, problem solving and troubleshooting capability in carrying out their functions. In this regard, they are responsible for documenting process or equipment problems/issues or any unforeseen circumstances and ensuring they are effectively addressed.

1.16.13 Where required, Team Leaders must be prepared to apply any competencies and perform all duties for which they are proficient, subject to safety standards and any licensing requirements. This includes a preparedness to utilise any of the competencies acquired, and duties undertaken, at lower classification levels. The Team Leader will provide coverage for the Process Controller role during instances of absence. It is an expectation that operators who are classified at the level of Team Leader will undertake any aspect of the Team Leader role when directed by the Company.

1.16.14 In addition to all the training and competencies required of a Smelter Operator 5, Team Leaders are expected to undertake the appropriate training to acquire the additional skills and knowledge determined by Management as necessary to fully and competently undertake this role.

1.16.15 This job position is set at Level 6 in the pay rate structure in 21.1.1.

 1   Witness Statement of Brett Noonan, Exhibit AWU-2 at [5]-[7]; Transcript of Hearing at PN226-236

 2   Ibid at PN285, PN289

 3   Email from Mr M Hermecz to Mr B Milne, dated 19 February 2013, Exhibit Alcoa-1.

 4   Witness Statement of David Paul Dorsey, Exhibit Alcoa-2 at [26] and Attachment ‘DPD-11’

 5   Transcript of Hearing at PN248, PN492-PN498

 6   Ibid at PN249-PN251

 7   Ibid at PN344-PN406 and PN466-PN484

 8   Exhibit Alcoa-2, at [18] and Attachment ‘DPD-8’

 9   Ibid at [19]

 10   Transcript of Hearing at PN100-PN104.

 11   Ibid at PN154

 12   Witness Statement of Millar Irvine, Exhibit AWU-1 at [9]

 13   Witness Statement of Brett Dale, Exhibit AWU-3

 14   Exhibit Alcoa-2, Attachment ‘DPD-9’

 15   Exhibit Alcoa-2 at [20]

 16   Transcript of Hearing at PN465

 17   Ibid at PN182-PN191

 18   Ibid at PN159, PN505

 19   Ibid at PN505

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