Transport Workers' Union of Australia v Toll Transport Ltd T/A Toll Global Logistics

[2021] FWC 3143

[2021] FWC 3143

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

Transport Workers’ Union of Australia
v
Toll Transport Ltd T/A Toll Global Logistics
(C2021/351)

DEPUTY PRESIDENT BEAUMONT PERTH, 29 JULY 2021

Dispute arising under an enterprise agreement –is the Toll Coca Cola site a ‘comparable Toll site’ to the Toll Asahi site – dispute determined

1 The issue and conclusion

[1] This decision concerns an application made by the Transport Workers’ Union of Australia (TWU) under s 739 of the Fair Work Act 2009 (Cth) (Act) regarding a dispute between it and Toll Transport Pty Ltd t/a Toll Global Logistics (Toll). The dispute concerns the interpretation of a particular clause under the Toll – TWU Enterprise Agreement 2017-2020 (Agreement). 1 Briefly stated, the question asked is whether the Toll Coca Cola site (Coke site) is a ‘comparable Toll site’ to the Toll Asahi site (Asahi site) for the purpose of clause 4.4(c) of the Agreement.

[2] On face value the issue seems unassuming. However, the point is an important one for the parties. If the two Toll sites are in fact ‘comparable’, as that term is understood in the context of the clause 4.4(c), then it would appear that Toll is obliged to ensure pay parity across the two sites. It is uncontentious that the rates of pay at the Coke site are more than those at the Asahi site. Having considered that they do the same work as their Coke site counterparts, the Asahi site ‘Transport Workers’ want to be paid the same.

[3] The Agreement in question applies to the employment of ‘Transport Workers’ and is binding on both Toll and the TWU. 2 For the purpose of this decision, the terms ‘Transport Worker’, ‘driver’ and ‘truck driver’ are used interchangeably. Further, it is observed that there is no dispute that the Toll and the TWU have adhered to the steps required to be taken under the dispute resolution clause of the Agreement.3

[4] In short, I have concluded that the Coke site is not a ‘comparable Toll site’ to the Asahi site for the purposes of clause 4.4(c) of the Agreement. My reasons for reaching this conclusion follow.

2 Background

[5] By way of background, Toll provided the following detail about its operations. This evidence was in many respects unchallenged by the TWU.

2.1 Toll’s operations

[6] Toll operates through a number of divisions and business units. Within the Toll Global Logistics division, sits the business unit referred to as Retail Consumer Auto (RCA). RCA’s businesses include, amongst others, a range of contracts for the distribution of beverages. It has 33 beverages operations nationally with a range of customers.

[7] According to Toll, the driver pay rates are different across all of these operations. Likewise, the commercial arrangements with the customer, the price charged to the customer, the productivity of the operation and the revenue opportunity from each, are all different.

[8] Toll explained that the Agreement required a minimum driver rate of Award plus 10%. Beyond that, said Toll, labour rates were typically determined as part of the costing for what Toll will charge a customer, which was often presented in the course of a competitive tender. Toll submitted that labour costs formed the majority of the costs of a transport operation. As part of the process in determining labour rates, Toll said it assessed what would achieve a competitive labour cost and therefore customer price, and what would be sufficient to attract and retain employees to do the type of work involved under the proposed conditions in the particular region.

[9] Regarding its contract with Coca-Cola (Coke Contract), Toll submitted that it was a longstanding operation, having commenced in 1998. It observed that under the Coke Contract, the rates of pay had increased on a compounding basis since the contract’s inception.

[10] In contrast, the route delivery work undertaken for Asahi commenced in 2017 (Asahi Contract). Toll outlined that the tender for this work was costed on the basis of certain assumptions as to productivity, labour costs and variable costs (repairs and maintenance, etc.). The labour rate assumption was ‘Award’ plus 10%, which was considered sufficient, said Toll, in respect of being competitive in the market and regarding the work to be performed.

[11] Mr James Kee, Senior Manager – Beverages WA, gave evidence on behalf of Toll. He elaborated on how Toll determined the price it would put forward to a customer. He explained that a large proportion of the price proffered, which incidentally determined how the contract could be profitable, was based on an assumption as to productivity or drop density. 4 This, he said, reflected an assumption as to the average hours per run, and how much product could be delivered within those parameters.5

[12] It was Mr Kee’s evidence that pay rates at the various Toll sites within Global Logistics were influenced by: (a) type of work, including the skill level and difficulty involved; (b) the location and region; (c) Toll’s competitive position relative to other transport companies; (d) the recruitment/employment market; (e) the commercial arrangement with the customer; and (f) the history of the workplace – industrially, commercially, and from a macro-economic perspective (nationally or region-specific). 6

[13] Clearly, what was of significance to Toll, was the competitive environment in which Toll operated. In his evidence, Mr Kee spoke of it being increasingly difficult for the ‘Beverages’ business to retain or win work in circumstances where competitors were able to bid with lower labour costs. 7 Mr Kee said that whilst Toll used to perform the Asahi route work in Western Australia, Queensland, New South Wales and South Australia, it had lost that work to smaller transport competitors, with the exception of Western Australia.8

2.2 The Asahi Contract

[14] As noted, when Toll won the Asahi Contract, it did so on a labour cost assumption of Award plus 10%, as required by the Agreement. Mr Kee said that after a period, Toll knew that it would need to adopt a subcontractor model to remain competitive. 9 However, according to Mr Kee, there were several casual drivers entitled to casual conversion under the Agreement, and so Toll considered it was obliged to employ that group on a permanent basis.10 Consequently, Toll engaged four employees on the Asahi contract and around twelve subcontractors.

[15] Mr Kee said that in 2018 the TWU requested that the pay rates in the Asahi Contract be increased outside of, and in addition to, the yearly increases prescribed by the Agreement. 11 Mr Kee clarified that the TWU had expressed that the rates should be in parity with those provided under the Coke Contract, based on clause 4 of the Agreement. Mr Kee said that at this time, under the Asahi Contract, the Grade 2 rate was $21.85, and the Grade 4 rate was $22.52.12

[16] Expressing that he disagreed with the TWU’s proposition, Mr Kee explained that the Coke Contract rates of pay were too high and above the market rate – making them commercially unviable. He explained that the only reason Toll discussed with the TWU its proposition, was to try to avoid the ‘Coke’ rates being paid at the Asahi site and further disputation. 13

[17] Mr Kee said that Toll negotiated an increase of pay rates up to $26.52 for Grade 2 and $27.04 for Grade 4, both inclusive of the 1 July 2018 increase provided for in the Agreement, with any subsequent increases to be per the Agreement. 14 According to Mr Kee, the TWU advised Toll on 31 August 2018 that the proposal had been accepted.15

2.3 The Agreement – and where the issue lies

[18] Clause 4 of the Agreement reads:

4. Coverage

4.1 General

This Agreement applies to and is binding on Toll, all Transport Workers and the Union.

4.2 Acquisitions of businesses

(a) This clause 4.2 will apply if Toll acquires a new business during the Term, the employees of which fall within the definition of “Transport Worker” in this Agreement.

(b) Toll will ensure that:

i. if the employees in the acquired business are or become employed by Toll to work at an existing Toll site, the employees receive the rates of pay and conditions of employment applicable to Transport Workers at that site, provided that the employees must not be paid a lower rate or receive less favourable conditions of employment than those that they may be entitled to receive under any enterprise agreement or similar industrial instrument applying in the acquired business; or

ii. if the employees are engaged at a separate site, the employees receive the equivalent of the remuneration increases available under this Agreement on a pro rata basis from the date of the acquisition, provided that if any enterprise agreement or similar industrial instrument applying in the acquired business provides a greater increase for part of all of the Term then that increase will be paid for the corresponding period after which time the equivalent of the remuneration increases available under this Agreement will apply on a pro rata basis.

(c) If clause 4.2(b)(ii) applies the parties will create a Local Agreement for that sit in accordance with clause 8.3.

4.3 Tenders

(a) This clause applies where Toll submits a tender to a customer or potential customer for work which is currently being performed by a competitor, and which, if it were performed by Toll, would be covered by this Agreement (New Contract).

(b) Where agreed between Toll and the Union, Toll may tender for the New Contract at the rates being paid by the competitor to its employees (Tender Rates) and, subject to clause 4.4, pay the Tender Rates to:

i. any Transport Worker it employs who had previously been employed by the competitor; and

ii. any new Transport Worker it employs to work on the New Contract.

4.4 Consultation regarding applicable rates

(a) Toll agrees to consult with the Union about any disparity between:

i. the rates of pay and conditions of employment applying to Transport Workers in the acquire business and those applying at an equivalent Toll site, arising from clauses 4.2(b)(ii); or

ii. the rates of pay and conditions of employment applying to Transport Workers performing work under the New Contract and those applying at an equivalent Toll site, arising from clause 4.3(b).

(b) The powers of the FWC to deal with any Dispute between Toll and the Union arising out of the consultation referred to in clause 4.4(a) will be confined to conciliation.

(c) Notwithstanding anything else contained in this clause 4.4, rates being paid by Toll to Transport Workers engaged in an acquired business or performing work under a New Contract will be brought into parity with those paid to Transport Workers at a comparable Toll site within 3 years after Toll acquires the new business or secures the New Contract, as the case may be. (Italics my emphasis).

3 The TWU’s submissions

[19] The TWU explained that the principles that apply to the interpretation of industrial instruments such as enterprise agreement are well established. Construction of the agreement begins with a consideration of the ordinary meaning of its words and regard must be had to the context and purpose of the provision being construed. Context may appear, said the TWU, from the agreement taken as a whole, its arrangement and the place occupied by the clause in question.

[20] According to the TWU, the approach of the Commission concerning the interpretation of enterprise agreements was not a narrow or pedantic one. Instead, the Commission sought to discern the meaning intended by the framer(s) of the document, bearing in mind that such framer(s) were likely of a practical bent; and may 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. 16

[21] The TWU identified that the parties were in dispute about the term ‘comparable site’, noting that the word ‘comparable’ was a commonly used word, and on that basis should be given its usual meaning. Turning to the Cambridge Dictionary (online), the TWU borrowed from it the meaning attributed to ‘comparable’; namely, ‘similar in size, amount or quality to something else’.

[22] The TWU submitted that clause 4.4 deals with wage rates of Transport Workers that come within the scope of that clause. In that context, said the TWU, to determine whether one site is a ‘comparable site’ to another work site, the point of comparison had to be the work that was being performed by Transport Workers at each of the Asahi and Coke sites.

[23] On this point, the TWU urged that the evidence of its witnesses clearly showed that the work performed at the Asahi site and the Coke site was very similar. It detailed that Transport Workers at both sites performed route deliveries. Those deliveries included the manual unloading of cartons from the truck or unloading the truck by a forklift or a pallet jack - for bulk deliveries. The TWU provided further details of the work involved:

a) a significant majority of the work for route drivers was unloading cartons manually from the truck and placing those cartons onto a trolley. The drivers then deliver the cartons by trolley to the customer;

b) customers to whom the drivers at the Coke site and the Asahi site make deliveries to, are also similar and include shops, lunch bars, delicatessens, service stations, shopping centres, and fast food outlets;

c) the vehicles were similar at both sites, namely trucks ranging from 6 tonne to 12 tonnes;

d) cartons that Transport Workers across the sites were required to handle ranged from 5kg to 25kg;

e) the number of deliveries that the Transport Workers at both sites undertook was similar – namely 30 deliveries involving some 6 to 7 tonnes of cartons; and

f) at both sites the Transport Workers handled payment from customers for deliveries.

[24] The TWU conceded that there was no issue that the Coke site was a larger site than the Asahi site and that more drivers worked at the Coke site. However, the TWU cautioned that for a particular work site to be comparable to another work site, that work site did not have to be the same in all respects. It must only be similar, said the TWU, who pressed that the evidence showed this to be the case.

[25] The TWU’s concluding remark was that it was clear from its evidence that there was a very high similarity between the work and the duties that Transport Workers performed at the Asahi site, and those which were undertaken by the Transport Workers at the Coke site.

4 Toll’s submissions

[26] Toll stated that the Applicant appeared to consider a ‘comparable’ Toll site as one where the product being transported, the vehicle being used for transport, and the usual method for delivery of the product, were broadly of the same or similar kind. However, Toll said that this was an incorrect application of the term ‘comparable Toll site’ in an industrial context and in the context of Toll’s transport businesses which were covered by the Agreement. It argued that the term ‘comparable site’ must mean more than simply a workplace where the subject matter of the delivery is the same and the same type of vehicles were utilised.

[27] Like the TWU, Toll acknowledged that the principles governing the interpretation of industrial instruments were reasonably well settled. In this respect it referred to those principles in the Full Bench decision of The Australasian Meat Industry Employee Union v Golden Cockerel Pty Limited. 17

[28] Toll pressed that the term ‘comparable Toll site’ must be considered in the context of the industrial agreement and the transport operations covered by it. This included consideration of the following matters, said Toll:

a) Toll’s transport operations often involve the distribution of the same or similar product (whether that be gas, fuel, consumer goods, food products or equipment) for different customers under particular contracts, in various regions, using the same or similar vehicles;

b) the Agreement stipulates a wage floor of Award plus 10%. The Agreement also accepts that actual wages vary by workplace through the incorporation of Local Agreements which stipulate a variety of rates and conditions. It can be seen from the Local Agreements that rates and conditions vary even for workplaces involving the same product and method of distribution, in the same region (for instance, Coles and Woolworths in Perth); and

c) the transport operations covered by the Agreement vary widely in terms of customer, commercial structure, history and competitive context, even where commonality of product and delivery method exists.

[29] Toll submitted that clause 4.4.(c) refers to a ‘comparable Toll site’, not to a Toll site involving distribution of the same or similar product by similar means. If the term had the meaning contended for by the Applicant, said Toll, a large proportion of Toll sites across Australia would carry identical rates, including those for supermarket customers such as Coles and Woolworths. This was clearly an incorrect application of the term, and Toll could not feasibly operate under such a structure.

[30] Toll continued that it was in the business of transporting things, by trucks, operated by drivers. Many of these trucks were similar or the same. Many of the products were similar or the same. The operations typically looked very similar, day to day. A ‘comparable Toll site’ therefore must, said Toll, considered in the relevant context, mean something more than a site where the same or similar product is distributed by a similar vehicle type and method.

[31] Insofar as the ‘Coke Contract’ and the ‘Asahi Contract’ were not ‘comparable Toll sites’, Toll drew upon the following factors:

a) the work performed by the drivers is not comparable, as explained in the statement of Mr James Kee. The differences in work include:

i. the Coke Contract involves a higher degree of physical labour;

ii. the pace, or productivity, of the Coke Contract work is much higher than the Asahi Contract;

iii. Coke Contract drivers operate under stricter conditions and to higher performance expectations than Asahi Contract drivers.

b) the commercial structure of the contracts is substantially different. Toll is able to achieve significantly more revenue per drop on the Coke Contract than that Asahi Contract, with a lower quantity of labour and maintenance costs; and

c) the history of the Coke Contract has resulted in a wage rate that is above market (and above the average rates for Toll beverages contracts nationally). It is not a rate that Toll (or any competitor) would adopt if tendering afresh for similar work now, or within the last five years.

5 Consideration

[32] The fundamental point of disagreement between the parties is whether the Coke site is a comparable Toll site to the Asahi site. Neither party advanced comparing the Asahi site to another Toll site.

[33] In my view, the first step is to attribute meaning to the phrase ‘comparable Toll site’. The second, to take from that meaning the methodology on how to determine whether a Toll site is comparable (the relevant factors to consider), and then the third step – to engage in a comparative exercise between the Coke site and the Asahi site having regard to the ‘relevant factors’.

[34] The principles applicable to the interpretation of enterprise agreements are well settled and were summarised by the Full Court of the Federal Court in WorkPac Pty Ltd v Skene. 18 The starting point is the ordinary meaning of the words, read as a whole and in context.19 As observed by the parties, the language of the agreement is to be understood in the light of its industrial context and purpose, not in a vacuum or divorced from industrial realities. A purposive approach to interpretation is appropriate, not a narrow or pedantic approach.

[35] Turning to the term ‘comparable Toll site’, it is used only once in the Agreement. Namely, in the context of clause 4.4(c). This is despite the word ‘site’ being ubiquitous throughout the Agreement.

[36] The first time the word ‘site’ is seen in the substantive context is in the definition of a ‘Transport Worker’. The Agreement sets out that a ‘Transport Worker’ means:

any person who is eligible to be a member of the Union and who is employed by Toll in Australia in any of the classifications contained in the Award or in a Local Agreement that applies at the site at which the person is, or is to be, employed. 20

[37] The word ‘site’ is defined in the Macquarie Dictionary in the following terms: 21

1. the position of a town, building, etc., especially as to its environment. 2. the area on which anything, as a building, is, has been, or is to be situated…

[38] We encounter the word ‘site’ again at clause 4.2 of the Agreement, which outlines Toll’s obligations where there has been a business acquisition and the employees of the acquired business become ‘Transport Workers’. The first circumstance is where Toll acquires a business and employs the employees of that business to work at anexisting Toll ‘site’. 22 If that occurs the new employees receive the rates of pay and conditions of employment applicable to Transport Workers at that ‘site’. While there is an exception to that approach, it is irrelevant for current purposes.

[39] The second circumstance envisages the employees being engaged at a separate ‘site’ (clause 4.2(b)(ii)). In that scenario the employees are to receive the equivalent of the remuneration increases available under the Agreement on a pro rata basis from the date of the acquisition. Again, this position is qualified, but the qualification is not relevant for current purposes. If this second circumstance occurs, the TWU and Toll are obliged to create a Local Agreement for that ‘site’.

[40] The word ‘site’ is next used in clause 4.4. Clause 4.4 is titled ‘Consultation regarding applicable rates’. Under clause 4.4 (a), Toll is obliged to consult with the TWU about any disparity between rates of pay and conditions in certain circumstances. There are two circumstances detailed at subclauses 4.4(a)(i) and (ii), they read:

(a) Toll agrees to consult with the Union about any disparity between:

i. the rates of pay and conditions of employment applying to Transport Workers in the acquired business and those applying at an equivalent Toll site, arising from clauses 4.2(b)(ii); or

ii. the rates of pay and conditions of employment applying to Transport Workers performing work under the New Contract and those applying at an equivalent Toll site, arising from clause 4.3(b) (bold my emphasis).

[41] The two limbs of subclause 4.4(a)(i) and (ii) both refer to an ‘equivalent Toll site’. It is noted that the word ‘equivalent’ connotes being ‘equal in value, measure, force, effect, significance or corresponding in position, function’. This turn of phrase ‘equivalent Toll site’ is not seen anywhere else in the Agreement.

[42] The reference to the phrase ‘equivalent Toll site’ is made in the context of clauses 4.2(b) and 4.3(b)(ii). We have considered clause 4.2(b)(ii), however, it is worth noting that clause 4.3(b) speaks to circumstances where Toll has submitted a tender to a potential customer or customer and a competitor is currently performing the work. If that work was to be performed by Toll, Toll may, with the agreement of the TWU, tender for the work at the rates being paid by the competitor to its employees.

[43] The next time the word ‘site’ appears it does so within the confines of clause 4.4(c), and that is where we see the word ‘comparable’ introduced. The word ‘comparable’ is defined in the Macquarie Dictionary as ‘1. capable of being compared. 2. Worthy of comparison. 23 The word ‘compared’ means:

1. to represent as similar or analogous; liken (to). 2. To note the similarities and differences of: to compare apples with pears. 3. To bring together for the purpose of noting points of likeness and difference: to compare two pieces of cloth. 4. ... To form or display the degrees of comparison of… 5. To bear comparison; be held equal… 24

[44] There are multiple further references to the word ‘site’ within the Agreement. At times the word ‘site’ is used in the context of ‘site or business’ – for example, ‘[I]f a site or business does not have a written Local Agreement’, but often the word stands alone. The use of the disjunctive tends toward a conclusion that the words ‘site’ and ‘business’ are not synonymous. This is illustrated further at clause 4.5 of the Agreement. Clause 4.5 is titled ‘Consolidated sites and transfers’. It reads:

(a) If Toll intends to transfer a business from one site to another site which is not covered by a Local Agreement, Toll and the Union will negotiate a new Local Agreement to cover that site.

[45] The clause suggests that the business stands apart from the site. Such that a business can be transferred from one site to another. In this respect, the word clearly connotes a geographical location – also see its use at clause 52.3 of the Agreement where reference is made to ‘site level’. The inference being a level that differs to that at perhaps the ‘corporate level’.

[46] In my opinion the ordinary meaning of the word ‘site’ and its use in the context of clause 4.4(c), clause 4, and the Agreement as a whole, designates a specific or discrete ‘locality’ or ‘place’ where Toll performs work.

[47] However, on any objective basis, to reduce the word ‘site’ to simply a geographical location would, in the context of the Agreement, fail to attribute to it the meaning of the word intended.

[48] Returning to the definition of ‘Transport Worker’ we know that a particular site may attract classifications in an Award or in a Local Agreement that apply at the site at which the person is, or is to be, employed. While the ‘site’ is a geographical location, ultimately it is where the work is performed – whether that be the delivery of service or the manufacturing of a product. Work is performed by employees in various classifications at the site, the site is also a point of hire, 25 there is an induction process or training for a site,26 and the terms and conditions of employment may differ between sites. For example, where a Transport Worker transfers from one site to another site at Toll’s request, the Transport Worker will be entitled to the terms and conditions applicable at the new site if they are more favourable than those the Transport Worker previously enjoyed at the old site.27 These factors lead to a conclusion that instead of a ‘site’ being simply a geographical location, it is a geographical location where Tolls’ operations are – that is where the work is performed.

[49] Therefore, any consideration of whether one Toll site is comparable to another, necessitates a comparison of the geographical locality (for example remote based or based in a metropolitan area) and an examination of the operations of the two sites – including the nature of the work performed, productivity, span of control, size of the operations, the deliverables whether in service or product, the complexity of the operations, equipment used, and performance indicators.

[50] Toll has argued that the comparison extends beyond that, submitting that the term ‘comparable Toll site’ must be considered in the context of the industrial agreement and the transport operations covered by it, such that the commercial structure of the contracts with Toll’s clients like Coke and Asahi are to be considered. Briefly stated, Toll’s position appears to be that to determine whether a Toll site is a ‘comparable Toll site’, the costing of the tender – that is labour costs under the commercial contract between Toll and the customer or client are to be considered (price charged to the customer) in addition to the revenue opportunity from each.

[51] On this point Toll referred to being able to achieve significantly more revenue per drop on the Coke Contract than that Asahi Contract, with a lower quantity of labour and maintenance costs. In effect, Toll incorporated into the consideration of ‘comparable Toll site’ a direct comparison between the commercial structure of the contracts with clients. In my view, ascertaining whether a site is a ‘comparable Toll site’ does not extend to the competitive environment in which the commercial contract was negotiated, the history of a particular site regarding contractual negotiations, or the commercial structure of the contract with the client to the extent that the labour costs for that contract are relevant factors. In my opinion that would require an analysis of the commercial contracts to determine whether the commercial contracts were comparable, in contrast to whether a site was a ‘comparable Toll site’. However, that is not to say that the commercial contract has no bearing on the operations of a site – such as the setting of key performance indicators, productivity measures and procedures or processes that are required to be followed.

[52] Toll itself submitted that if the term had the meaning contended for by the TWU, a large proportion of Toll sites across Australia would carry identical rates, including those for supermarket customers such as Coles and Woolworths. This, said the Toll, was clearly an incorrect application of the term, and Toll could not feasibly operate under such a structure. According to Toll, the Transport Worker pay rates are different across all of its RCA operations. Likewise, the commercial arrangements with the customer, the price charged to the customer, the productivity of the operation and the revenue opportunity from each, are all different. If that is the case – the question should surely be asked whether clause 4.4(c) would ever have any work to do given that no Toll site would appear comparable on this basis.

[53] The Agreement contemplates circumstances whereby Toll acquires a business or submits a tender to a customer or potential customer and a disparity results in the rates of pay between the Transport Workers in the acquired business and those applying at an equivalent Toll site, or for the Transport Workers performing work under a new contract and an equivalent Toll site. In these circumstances, Toll is obliged to consult about such matters and within a specified period achieve parity between those Transport Workers ‘newly’ hired compared to those at the ‘comparable Toll site’. The Agreement clearly contemplates identical rates when sites are ‘comparable Toll sites’. In my view, it is not simply the terms and conditions of the tender submitted or the commercial contract agreed upon that render a Toll site comparable or not comparable with another Toll site.

[54] Mr Kee spoke about the pay rates at Toll sites within Global Logistics being influenced by several factors. These factors are detailed at paragraph [12] of this decision. While the factors may have bearing on the rates of pay, it does not necessarily follow that all are relevant considerations when determining whether a Toll site is a ‘comparable Toll site’ for the purpose of the Agreement. However, I am of the view that some are.

[55] For the reasons given, I am satisfied that the following factors are relevant considerations when determining whether a site is a ‘comparable Toll site’ for the purpose of the Agreement. Those factors include the location of the work or operations of Toll, the type of work, service provided, product delivered, productivity (such as pick rate, drop density, average hours per run, delivery windows, key performance indicators), equipment used, skill level required, and difficulty or complexity of the work. While I appreciate factors such as key performance indicators may in part be dictated to by the terms of the commercial contract between Toll and its customer or client, Toll is not precluded from driving its own efficiencies within its operations and setting key performance indicators that are improvements to those set in the contract.

[56] Before embarking on the comparative exercise, it must be remembered the word used is ‘comparable’. That word connotes being ‘capable of being compared’. ‘Compared’ meaning to ‘represent as similar or analogous’. It is not the case that the site must be the same, but instead ‘similar’.

[57] On behalf of the TWU, evidence was provided by Mr Kenneth Gluyas and Mr Simon Emery. Both identified as Truck Drivers at the Coke site and the Asahi site respectively. Mr Gluyas and Mr Emery noted that while they had worked for Toll for some years, particularly Mr Gluyas who had 21 years of service at the Coke site, they had never worked on any other Toll site save that which they were currently working on.

[58] Briefly stated, Mr Gluyas provided the following evidence concerning his work at the Coke site:

a) delivers mostly cartons of non-alcoholic and also alcoholic beverages to customers;

b) undertake route deliveries where the driver manually unloads the cartons from the truck and also bulk deliveries, where the truck is unloaded by a forklift or a pallet jack (80% of work);

c) route drivers unload cartons manually from 6 tonne – 8 pallet trucks and from 12 tonne – 14 pallet trucks;

d) cartons range in weight from 5kg to 205kg;

e) on an average day a driver would make deliveries to 30 customers, which would involve about 6 to 7 tonnes of cartons;

f) most of the cartons are delivered manually; and

g) drivers take cash payments and electronic payments which are reconciled at the end of the day when run sheets are submitted. 28

[59] Mr Emery spoke of his work at the Asahi site noting the following:

a) delivering 5 to 7 tonnes of beverages a day.

b) deliveries include pallet work and bulk drop offs. However, most work was pallet drop offs (route deliveries);

c) deliver to multiple places – can do up to 30 drops in a day and can also take over 100 boxes to KFC Fast Food venues at any time;

d) trucks range from 8 pallet to 14 pallet trucks and are loaded by Asahi staff (Toll drivers are not permitted to use their equipment; and

e) payment is taken for deliveries. 29

[60] As acknowledged, Mr Kee provided evidence on behalf of Toll. His evidence included an analysis of the distinction between the Asahi Contract and the Coke Contract. However, what Mr Kee actually spoke to in part, was the work performed at each of the sites – that is the operations of the sites. Included in his evidence was the following:

a) the drop/delivery rate is higher on the Coke site than on the Asahi site. On the Coke site the driver needs to unload an average of 20.9 cases per drop, compared to an average of 15 cases per drop on an Asahi site;

b) on a Coke site drivers typically do multiple runs per shift in contrast to a Asahi site where drivers typically do one run per shift;

c) the Coke site involves a higher level of day to day work pressure. On the Coke site, Toll does not get paid for any returns, including any incorrect picked deliveries or damaged stock therefore the allowable pick error at the Coke site is 0.6% per customer compared to the Asahi site where it is 3%;

d) the Coke site has strict delivery windows such that if an outlet is not open or available on the driver’s arrival there are criteria to follow before a delivery is considered ‘failed’ – including multiple calls to the customer. At the Asahi site, if a customer is not there, the driver simply calls up and fails the load, and then proceeds with their deliveries;

e) the Coke site has a delivery on time (DOT) key performance indicator. Toll is required to achieve a minimum 98% DOT or it incurs financial penalties and has a stretch DOT KPI of 99.5% which delivers financial incentives. In contrast, the Asahi site does not measure DOT; and

f) the Coke site requires drivers to deliver kegs whereas at the Asahi site this is not required.

[61] As far as the evidence is concerned, neither party adduced direct evidence of what they spoke to concerning Toll’s operations. However, I have no reason to doubt that the accounts presented by Mr Gluyas, Mr Emery and Mr Kee, were anything but true. For Mr Kee’s part, he unquestionably has a better appreciation of the operations at the Coke site and the Asahi site given that he has oversight of both. Further, he is positioned to better understand the productivity measures at the sites. I have therefore accorded weight to his account on those aspects of the operations which were not within the knowledge of Mr Gluyas and Mr Emery. This should not, in anyway, be seen to discredit the accounts provided by both gentlemen. It is simply the case that when undertaking an assessment as to whether a Toll site is a ‘comparable Toll site’ the operations of the site must be considered, not only the nature of the work.

[62] There are appreciable similarities between the nature of the work (in rudimentary terms - driving trucks to deliver product) undertaken at both the Asahi site and the Coke site. However, there also appears to be a marked difference between the two sites insofar as the operations are concerned – including the processes adopted, work methodology, number of routes taken, productivity measures and the evaluation of the same, the volume of product distributed, size of the operations and the number employees. I have found that these factors are of such difference that the Coke site is not a ‘comparable Toll site’ to the Asahi site.

[63] While parties disagreed on the point of whether drivers assumed responsibility for taking money or not, I do not consider anything turns on this.

[64] In all of the circumstances, the comparative exercise would have been assisted by the provision of direct evidence, in addition to providing evidence as to the operations of other Toll sites that the parties may have considered ‘comparable’. As it is, the exercise was limited by the evidence adduced. I can only make a decision based on the materials before me. Parties are, after all, responsible for advancing their own cases.

6 Conclusion

[65] For the reasons given, I have concluded that the Coke site is not a ‘comparable Toll site’ to the Asahi site for the purposes of clause 4.4(c) of the Agreement.

DEPUTY PRESIDENT

Appearances:

Mr. Adam Dzieciol, for the Applicant;
Mr. Charlie Nichols, for the Applicant;
Ms. Charissa McCutcheon, for the Respondent.

Hearing details:

Perth (video)
June 2
2021

Printed by authority of the Commonwealth Government Printer

<PR730352>

 1   [2017] FWCA 6556 (Toll Agreement).

 2   Toll Agreement Clause 4.1.

 3   Toll Agreement Clause 15.

 4   Witness Statement of James Kee (Kee Statement) [7].

 5   Ibid.

 6 Kee Statement [9].

 7 Kee Statement [8].

 8   Ibid.

 9 Kee Statement [12].

 10   Ibid.

 11 Kee Statement [14].

 12   Ibid.

 13 Kee Statement [15].

 14 Kee Statement [16].

 15 Kee Statement [17].

 16   Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v Berri Pty Ltd[2017] FWCFB 3005.

 17   [2014] FWCFB 7447.

 18 [2018] FCAFC 131.

 19 Ibid [197].

 20   Toll Agreement Clause 3.

 21   Macquarie Dictionary (5th ed, 2009) ‘site’ (def 1, 2).

 22   Toll Agreement Clause 4.2(b)(i).

 23   Macquarie Dictionary (5th ed, 2009) ‘comparable’ (def 1, 2).

 24   Macquarie Dictionary (5th ed, 2009) ‘compared’ (def 1 - 4).

 25   Toll Agreement Clause 17(g).

 26   Toll Agreement Clause 52.1 (d).

 27   Toll Agreement Clause 4.5(b).

 28 Witness Statement of Kenneth Gluyas [3].

 29   Witness Statement of Simon Emery [3] – [6].