The Application

1          The present matter before the Commission is one brought pursuant to s 42I of the Industrial Relations Act 1979 (“the Act”) by which the applicant seeks an enterprise order.  The terms of the enterprise order sought by the applicant are set out in the proposed Public Transport Authority Railcar Drivers (Transperth) Train Operations) Enterprise Order 2010 (“the applicant’s EO”).  By notice of answer and counter-proposal, the respondent has objected to much of the content of the applicant’s EO and has counter proposed an enterprise order sought by it to be known as the Public Transport Authority (Transperth Train Operations Railcar Drivers) Enterprise Order 2010 (“the respondent’s EO”).

2          Apart from the proposed terms of the enterprise orders sought by both the applicant and the respondent, the main distinguishing feature between the applicant’s EO and the respondent’s EO, is that the applicant proposes that the enterprise order operate in conjunction with the terms of the existing award covering railcar drivers, that being the Public Transport Authority Railcar Drivers (Transperth Train Operations) Award 2006 (“the Award”).  The respondent’s EO seeks in effect to incorporate the provisions of the Award into its proposed enterprise order, subject to some variations as set out in its counter proposal.

3          Additionally, some 253 Railcar drivers employed by the respondent sought, and were granted, leave to intervene in the proceedings pursuant to s 27(1)(k) of the Act.  This group, which I will describe as the Railcar Driver Group, is separately represented by Mr Momber of counsel.  The Railcar Driver Group has filed what is described as a “Log of Claims – The Railcar Group” which seeks wages and conditions in addition to the terms of the Award.

4          Leave to intervene pursuant to s 30(1) of the Act was also granted to the Minister in relation to the operation and effect of the State Government’s Wages Policy (“Government Wages Policy”) in the present proceedings. The Minister was represented by Mr Andretich of counsel.

5          The applicant appeared through Mr Ferguson and the respondent through Mr Farrell.

Procedural Matters

6          On 17 November 2010 the Commission made directions for the purposes of hearing and determining the application.  Those directions required the applicant, the respondent and interveners, to file and serve witness statements and supporting material, and outlines of submissions. The application was listed for hearing on 6 to 15 December 2010 inclusive.

7          By direction of 6 December 2010, following the conferral of the parties, interveners and the Commission in further conciliation, it was agreed by the parties and interveners that the Commission proceed to hear and determine the application essentially “on the papers”, on the basis of the written submissions and evidence as filed.  This was further supplemented by witness statements and written submissions in reply and by a hearing on 15 December 2010, at which the parties and the interveners had the opportunity to make further oral submissions in support of their respective contentions.  A large body of material has been filed by the parties and the interveners in support of their respective contentions.

8          Supplementary submissions and reply witness statements were filed on 17, 23 and 24 December 2010. Additionally, further materials requested by the Commission concerning recent historical comparisons of wage rates between the various State urban rail networks were provided on 21, 22 and 23 February 2011. 

9          No party or intervener sought to cross-examine any of those persons who had prepared witness statements on behalf of the parties and interveners and those statements stand as the evidence in this matter.

10       The Commission records its gratitude to the parties and interveners for the detailed and helpful submissions and evidence that have been filed, supplemented by the matters dealt with at the hearing on 15 December 2010.

11       Additionally, the Commission has been assisted by conducting workplace inspections on 2 December 2010, during the course of which the Commission inspected the Claisebrook Depot and its various facilities and undertook train journeys on several of the respondent’s train lines.  This included opportunities to speak with and observe railcar drivers at work driving trains on the metropolitan rail passenger transport network. These inspections have been of considerable assistance to the Commission in gaining a better appreciation of the submissions and evidence adduced in the proceedings.

Background

12       The circumstances giving rise to the present proceedings have a considerable, and at times quite turbulent, history.  For the purposes of placing the present application in context, I propose to briefly advert to some of the more recent history of the industrial relations between the parties and the Railcar Driver Group.  That recent history, and the industrial relations between the applicant, the respondent and the Railcar Driver Group, is somewhat unusual, and indeed, may be unprecedented in recent industrial relations history in this State, if not nationally.

13       In terms of industrial instrument coverage, at the time of the making of the Award, an industrial agreement under the Act was made, entitled the Public Transport Authority Railcar Drivers (Transperth Train Operations) Enterprise Agreement 2006 (“the 2006 Agreement”).

14       The 2006 Agreement expired on 31 December 2007, and thereafter effective 1 January 2008, the applicant retired from the 2006 Agreement with the consequence that the wages and conditions of employment of the Railcar Driver Group were regulated by the Award.  This situation continued, despite an offer made by the respondent to the applicant in May 2009 for entry into a new industrial agreement.

15       The circumstances giving rise to the present proceedings occurred in about July 2010, when the applicant initiated bargaining with the respondent for a new industrial agreement to cover drivers covered by the Award.  Despite bargaining taking place between the parties, no agreement was reached and ultimately, the Commission determined by declaration pursuant to s 42H of the Act, that bargaining had ended.  Upon that declaration having been made, the present proceedings for an enterprise order pursuant to s 42I were commenced.

16       The period of the bargaining negotiations between the parties was accompanied by significant industrial action by the railcar drivers covered by the Award, which has been recorded in detail by the Commission in earlier proceedings.  Suffice to say that the Railcar Driver Group have been a disaffected group of employees for some time, which is in part linked to union rules issues associated with the State and federal unions to which the railcar drivers are eligible to belong.

17       As a part of determining the industrial dispute between the parties and the Railcar Driver Group, on 24 September 2010 the Commission issued interim orders, part of which provided for an interim 5% wage increase for the drivers covered by the Award, which wage increase is able to be offset from any wage increase determined as a result of these proceedings.

18       There has been no further industrial action of any kind since the Commission’s interim order was made.

Contentions of the Parties

19       As noted above, the parties and interveners have filed detailed written submissions in support of the cases put by them, as supplemented by oral submissions at the hearing before the Commission on 15 December 2010.  What follows, is necessarily only a summary of those submissions.  I will deal with aspects of the submissions of the parties in detail, when considering aspects of the claims and counter claims advanced as a part of the present proceedings.

Applicant’s Submissions and Evidence

20       Mr Ferguson, on behalf of the applicant, noted the history of frustration amongst members of the Railcar Driver Group, which has spanned many years, in relation to wages and conditions of employment.  In canvassing the history of industrial instrument coverage since about 2004, reference was made to an enterprise order made by the Commission in July 2004.  It was contended by the applicant that a major issue in dispute at the time of the making of the enterprise order was provision for “trips and distance”, which was a condition of employment originally arising from the Locomotive Enginemen’s Award 1973.

21       Later, in 2006, the applicant negotiated with the respondent the terms of the Award.  Mr Ferguson emphasised that at this time, as a part of the making of the Award, the applicant agreed to a “buyout” of the trips and distance provisions, in return for which the Award contained a 5.5% wage increase which was, in turn, reflected in the 2006 Agreement.  The applicant referred to the Award and the 2006 Agreement as arising from the “ashes of the enterprise order”, which in Mr Ferguson’s submission, was seen by the applicant and the Railcar Driver Group as an unsatisfactory outcome given the issues raised at the time of the making of that enterprise order.

22       After the drivers retired from the 2006 Agreement and returned to regulation solely by the Award, a private arbitration took place to correct various provisions of the Award.  The applicant submitted that the result of the private arbitration in May 2008 has never been accepted by the workforce as a fair outcome.  The Railcar Driver Group have maintained since that time, that the suburban electric railcar allowance (“the SERA”), negotiated as a part of the Award and 2006 Agreement process, was unfairly reduced from a daily paid rate to a weekly amount, resulting in a reduction from some $177 per week to $35.40 per week, which is the present rate for the SERA.

23       In his submissions, Mr Ferguson referred to the applicant’s rejection on behalf of the drivers covered by the Award, of enterprise bargaining negotiations, in 2009, which entailed an offer of a 15% wage increase over the course of three years.  The respondent’s offer was rejected by the workforce by reason of aspects of the proposed agreement considered unacceptable to them, in particular provisions concerning compulsory overtime, shift times and lengths and residual disharmony following the events outlined above.

24       Mr Ferguson emphasised in his submissions that the present proceedings for an enterprise order seek a resolution of the issues in dispute between the parties, issues which have fermented a history of disputation over many years, and which the applicant is keen to overcome in order to provide industrial stability and harmony for the period ahead.

25       A key theme advanced in the applicant’s submissions is the view amongst the driver workforce that there exists a significant disparity between rates of pay for drivers operating on the respondent’s urban rail passenger transport network, when compared to their counterparts in other States.  It is contended that the drivers employed by the respondent are significantly lower paid than their counterparts operating in the same industry, and performing largely the same work.

26       This key theme was unashamedly advanced as a basis for a claim for comparative wage justice between the employees the subject of these proceedings in this jurisdiction, and those performing like work in other jurisdictions. In support of its claims, the applicant advanced a table of prevailing rates of pay for railcar drivers across the various States, as follows:

27      In addition to wage rates on a comparative basis, the applicant has identified key issues of importance to it in these proceedings including shift rosters and shift lengths; amendments to rosters once posted; shift work allowances and allowances for roster changes and operating Railcars; overtime rates; and discipline.

28      A number of submissions were made by Mr Ferguson in relation to the principle of comparative wage justice.  In support of the applicant’s arguments, reference was made to a number of authorities of industrial courts and tribunals historically that have referred to this principle, in particular principles established by the former Commonwealth Conciliation and Arbitration Commission.  The applicant referred to six principles in the assessment of a comparative claim, being the prevailing rate paid to an occupation; an assessment of the value of work being undertaken; the application of comparative wage justice principles within and between awards (and in the applicant’s case between agreement outcomes); the necessity to settle industrial disputes; the capacity to pay of an industry or economy; and the public interest.

29      It was the contention of the applicant that, as enterprise order making proceedings are like award making proceedings, the Commission should be primarily guided by s 26(1)(a) of the Act, which requires the Commission in the exercise of its jurisdiction under the Act, to decide a matter according to equity, good conscience, and the substantial merits of the case.

30      Furthermore, in applying this approach to the resolution of the present matter, the applicant submitted that “comparative wage justice was also an important criterion for the maintenance of industrial peace, for wage relativities establish an individual status in both industry and society and where varying rates apply for the same class of work it will arouse strong resentment”. The applicant contended that there was a necessity in this case to settle an ongoing industrial dispute that has been the cause of significant disharmony in the respondent's workplace for many years.

31      The applicant referred to the objects of the Act in s 6, in particular s 6(a) to promote goodwill in industry and in enterprises within industry and in further reliance on the objects in ss 6(a), (ac), (af), (c), (ca), (e), of the Act, in fulfilling those objects, it was contended that “Therefore as stated at 28. The union advocates that this Commission accepts that for the purpose of settling this dispute, Comparative Wage Justice has many benefits in bringing about a fair outcome and is a doctrine applicable in all the circumstances of this case”.

32      In particular, the applicant urged the Commission to adopt the approach in the Locomotive Enginemen’s Case (1925) 21 CAR 442 where at 445, Powers J set rates of wages for locomotive engine-drivers across the various States by adopting a fair average rate for drivers of trains across the mainland capitals.  Adopting this approach, the applicant contended that wage outcomes for 2010, 2011 and 2012, were represented in the following table:

TABLE 1

note: The median is the middle number of (average of the two middle most numbers if the set comprises an even number) Its advantage is that it is not affected by numbers that are unusually low or unusually high.

33      Thus, the applicant contended that a fair and reasonable approach to determining an appropriate rate of pay for railcar drivers would be to adopt the median rate as above.  Furthermore, the applicant’s submission was if one has regard to the wage offer of the respondent that was rejected by the workforce in 2009, in connection with the negotiation of a new enterprise agreement, the following is revealed:

see exhibit 13     TABLE 2

34      It was contended that in relation to the wages claim for 2010, at the median rate of $1140.31, this represents a fair and reasonable rate of wage. This is so when compared to the respondent’s offer made in 2009, as to what the rate of pay would have been in 2010.  The claimed rate for 2010 was submitted by the applicant to represent the real market value of the work of railcar drivers across the nation, and represents a 9.4% wage increase on the present Award rate.

35      The rate claimed of $1237.89 as a median rate for 2011 represents a further 8.5% wage increase and is some $64 greater than that offered by the respondent in the 2009 bargaining round.

36      In terms of 2012, Mr Ferguson submitted that, as the applicant has contended that the applicant’s EO operate for a term of 18 months, no wage increase be prescribed, given a nominated expiry of the enterprise order on 1 July 2012.  It was submitted that the parties should be directed to commence negotiations within three months of the expiry of the applicant’s EO, which may also assist in enabling any wage increases awarded for 2011 to be spread throughout the calendar year.

37      There were a number of submissions made by the applicant concerning the public interest and the national and State economies.

38      In referring to s 26(1)(c) of the Act, Mr Ferguson contended that this was a case in which the Commission should take into account the interests of the community as a whole as a relevant consideration.  These matters were contended to include the costs involved in granting the applicant’s claims; the State and national economy; the Government Wages Policy; and that the employees covered by the applicant’s EO should not be materially disadvantaged compared to other employees in the same industry or occupations elsewhere.

39      In referring to the public interest generally, Mr Ferguson referred to In Re Crown Employees (Teachers – Department of Education) Award [1970] AR (NSW) 345, a decision of the Industrial Commission of New South Wales dealing with wages for State school teachers in that jurisdiction. Reference was made to the observations of Sheldon J at 521 where it was said:

“Teachers are certainly the biggest professional career industry group in the community.  Their numbers are so large that any award materially increasing their salaries must necessarily involve a great sum of money, but this fact is not a legitimate barrier to their right to receive remuneration commensurate with their work and its contribution to the welfare of the community.”

40      In referring to the broader national economic outlook, the applicant took the Commission to the Australian National Accounts:  National Income, Expenditure and Product ABS June Quarter 2010, and said this leads to the conclusion that:

(a)              Labour costs have fallen by 2.8% over 12 months;

(b)             Labour cost reductions have coincided with GDP per hour worked in the market sector (a measure of labour productivity) rising by 1.8% in trend terms;

(c)              The profit share has grown to 26.7% in trend terms after the second successive quarter of growth;

(d)             GDP grew by 4.1% annually in trend terms and 2.1% in the March quarter;

(e)              In trend terms, growth during the quarter was strongest for Western Australia rising by 2.7%;

(f)               Consumption expenditure in Western Australia in trend terms increased by 2.5%;

(g)             Western Australia recorded positive growth of 1.8% as a measure of private gross fixed capital formation; and

(h)             In trend terms, overall growth was positive with the strongest growth recorded in Western Australia of 11.1%.

41      The Commission informed the parties prior to the hearing that it intended to take into account recent reports on the state of the Western Australian economy, the parties and interveners therefore addressed this point. The applicant submitted that the 2009-10 Annual Report on State Finances indicates that:

(a)              There has been an $831,000,000 general government operating surplus recorded for 2009-10 which is some $541,000,000 higher than the estimate published in the May 2010 State Budget;

(b)             The surplus represents some 3.8% of general government revenue compared to an average surplus outcome of 11.5% of revenue over the period 2003-04 to 2007-08;

(c)              Wages pressures are anticipated to ease in the short term given the impact from the slow down of the State economy in 2008-09.  Also, the Wage Price Index rose by 5.2% over 2008-09, which has created a high base level for wages growth in 2009-10; and

(d)             As the State economy recovers in 2010-11, the Wage Price Index is forecast to grow by 3.25% and 3.5% in 2011-12.

42      Overall, the applicant submitted that the Western Australian economic position is robust, whilst acknowledging that prudent economic management policies are necessary to sustain ongoing growth and recovery.

43      In terms of the Government Wages Policy, the applicant submitted that any such policy, as good policy, must be capable of accommodating situations where the strict application of its terms is not in the public interest and would be contrary to an outcome based upon principles of equity and fairness.  In this respect, it was said that the railcar drivers have been excluded from the benefits that flowed from the period of 2008-09 and there is financial capacity within the State to sustain an improvement in their wages which is in the public interest and consistent with a fair and just outcome.

44      Turning away from the wages claim and the relevant principles urged upon the Commission, Mr Ferguson made a number of other submissions in relation to specific aspects of the applicant’s EO claim.

45      In relation to the additional margins payable to shed drivers, driver trainers and driver coordinators, the applicant made a number of submissions.

46      The applicant’s claims for margin increases for these three classifications were set out in a table as follows:

Currently margins within the Award provide the following outcomes as shown in column one and two below.  The union claim is shown in column three and four:

TABLE 3

 Note: Figures based upon award rates prior to the "interim order" being made.

47      In relation to the Driver Coordinator, this classification is presently paid at a rate of 111% of a driver’s rate.  By way of background, the applicant contended that in 2006, as a part of negotiations in relation to wages, wage rates for drivers and the related classifications were disaggregated. The impact of this on Driver Coordinators was significant because their roster, following disaggregation of wage rates, did not enable the same earning capacity as other classifications.

48      In June 2006, a competency profile for Driver Coordinators was undertaken by the Transport and Storage Industry Training Council on behalf of the respondent.  The purpose of this study was to determine whether Driver Coordinators were performing tasks and undertaking duties outside of the existing JDF for the position and the then competency profile, and whether there may be any requirement for reclassification for the job.

49      The applicant contended that as a consequence of this review, the Driver Coordinator margin increased to 17% above the drivers’ rate. Following the rejection by the drivers’ of an industrial agreement in 2008 and a subsequent return to coverage under the Award, the Driver Coordinator margin reduced to 111% of the drivers’ rate, as is the current margin.

50      The issue of margins for Driver Coordinators continued. As a result of discussions between the parties, from March 2008, the respondent agreed to provide an allowance of $168.19 per week for this group.  Subsequently, the allowance has been reduced by the amount of the Commission’s General Order in the State Wage Cases of 2009 and 2010, leading to a current rate of $139.39 per week.

51      The applicant contends that as a consequence, the Driver Coordinators have suffered a reduction in their wages over the course of 2009 and 2010, by the absorption of State Wage Order increases.

52      The justification for an increase in the Driver Coordinator margin to 121% of the driver rate is essentially twofold.  Firstly, it is contended that the June 2006 Training Council report identified that the Driver Coordinators have responsibilities that are in addition to, and at a higher level than, those identified in the relevant JDF. Emphasis was placed on the training responsibilities of Driver Coordinators, and additionally substantially higher levels of supervision, situational analysis, communications and the coordination of group activities than that specified in the JDF requirements.

53      Secondly, the applicant contended that the ongoing requirements of the respondent following the commissioning of the Mandurah to Perth rail line, have placed a greater level of burden on Driver Coordinators to acquire higher levels of knowledge relevant to the operation of a modern rail network.

54      Specifically, it was contended that training and assessment workloads have increased in complexity since 2007.  The training package for which the Driver Coordinators are responsible has been expanded, having regard to new railcars and technology, signalling new track and block station movements on the Mandurah line; tunnel evacuation for Perth Underground and the Esplanade, and the introduction of biennial training.

55      Furthermore, reference was made to the numbers of new drivers being trained and assessed at the present time as being at the same high level as occurred in 2007-08, when the Driver Coordinator margin was increased to 117% of the driver’s rate.

56      In conjunction with this, the applicant submitted that additional functions and responsibilities are required to be performed by Driver Coordinators outside of the agreed JDF. These include help in organising rostering of assessments; making up assessments of workers; maintaining spreadsheets and other training documents; answering telephone calls from drivers regarding on track emergencies and fault situations; and organising change outs for railcars, in particular on weekends, when no Depot Master is present.

57      Reference is also made to the required qualifications for Driver Coordinators, they being the Certificate III in Railcar Transport and Distribution and the Certificate IV in Workplace Training and Assessment.  The contention was that the only other position requiring such qualifications is the respondent’s Training Manager EMU which is a Level 6 position with a base salary of $102,000.00.

58      In referring to the evidence of Ms Kent, a Driver Coordinator, reference was also made to discussions between the Driver Coordinators directly and the respondent, concerning the replacement of the current allowance with an increased margin above the drivers’ rate, whereby it is said that the respondent itself has contemplated a margin of approximately 19-20% in these discussions.

59      On all of these bases, the applicant contends that a margin of 121% is fair and reasonable.

60      Ms Kent is presently employed by the respondent as a Driver Coordinator and has been in that position, based at the Nowergup Depot, since 2005, following the extension of the respondent’s rail network to Clarkson.  Ms Kent gave evidence about the responsibilities of her position, and the margin between her rate of pay and that of a Driver.

61      According to Ms Kent, under the terms of the Award, she was paid a margin of 11.5% above the drivers’ rate.  This margin was set at a time when drivers were paid an aggregate rate.

62      Ms Kent referred to the disaggregation of rates of pay for train drivers from 2007.  However, for Driver Coordinators, their rosters were such that the move to disaggregation was going to cause that group a significant financial disadvantage.  As a result, the respondent agreed with the Driver Coordinators, to maintain the relativity between their rate of pay and train drivers, by implementing an aggregate rate.

63      Arising from this, the respondent initiated the review of the duties of Driver Coordinators, referred to above.  According to Ms Kent, following the review report, a new JDF was prepared and implemented for Driver Coordinators, and an agreed margin was set at 117% of the drivers’ base rate. 

64      Whilst on the reversion to the Award, as noted, the rate for a Driver Coordinator fell back to 111.5% above the drivers’ rate Ms Kent gave evidence about the agreement with the respondent for an additional allowance to make up the difference. This was initially set at $168 per week, but as referred to in Ms Kent’s evidence, it has been progressively decreased by the absorption of State Wage Order wage increases, and following the absorption of the 5% interim wage increase, it is now $80 per week.

65      In addition to the reduction in the allowance agreed with the respondent, Ms Kent gave evidence about the changes to the duties and responsibilities of a Driver Coordinator. In particular she referred to a continuing increase in training loads, despite the opening of the Mandurah Line in 2007.

66      Furthermore, Ms Kent referred to a greater level of complexity in the training packages conducted by the Driver Coordinators and the introduction of biennial training in 2009, which has resulted in all 280 drivers or thereabouts, being trained in a week long training course and a full day track assessment.

67      Additionally, Ms Kent referred in her evidence to daily tasks performed by Driver Coordinators that are above and beyond the JDF agreed with the respondent and introduced in 2007. Some of this work includes assistance in rostering of assessments, which involves the application of some rostering principles; maintaining spreadsheets and other training documents; answering phone calls from drivers when they encounter on track emergencies or other situations, and providing assistance with faults to their railcars; and providing assistance in organising change-outs for railcars, especially on weekends, when no Depot Master is on duty.

68      Ms Kent’s evidence was that none of this work is covered in the JDF for Driver Coordinators, but is contained in JDFs for other higher level positions.

69      As referred to in the applicant’s submissions, Ms Kent noted that Driver Coordinators have to complete qualifications including a Certificate III in Railcar Transport and Distribution, and a Certificate IV in Workplace Training and Assessment.

70      When looked at in this way, Ms Kent described the present situation as whilst Driver Coordinators have increased their work load and work value to the employer, this is being met with an effective stagnation or reduction in the remuneration for this position.

71      In relation to the position of Driver Trainer, the present margin is 105% of the drivers’ rate. The applicant claims an increase in the margin to 113% of the drivers’ rate.  The applicant’s submission in relation to this position was that this is a demanding role and one that carries responsibility to ensure that Driver Trainees are fully and property trained in accordance with the respondent’s operating procedures.  Additionally, Driver Trainers are required to drive on the main lines when required.

72      A number of aspects of the Driver Trainers’ responsibilities were emphasised by the applicant.  In particular is the responsibility of Driver Trainers for errors made by Driver Trainees under their supervision and for which errors the Driver Trainer may be subject to discipline by the respondent.

73      Additionally, Driver Trainers are required to be completely familiar with the “Driver Trainer Manual” and must record all aspects of driver training tuition provided.  Driver Trainers also undertake appropriate “on track” practical training, and are required to also undertake a training course in training small groups.

74      The applicant’s submission was that the claimed margin of 113% is reasonable and fair, and compares favourably with, for example, the Driver Trainer margin in New South Wales, where Driver Trainers receive a margin of approximately 112% above the drivers’ rate.

75      Evidence was given by Mr Nedeljkovic, who has been a Driver Trainer for approximately five years.  Mr Nedeljkovic commenced employment with the then Government Railways in 1973 as a Locomotive Engineman, operating locomotives within the freight section of the Government Railways.

76      Mr Nedeljkovic outlined his duties as a Driver Trainer, including the provision of all tuition to Driver Trainees, following the instruction given by Driver Coordinators.  This work involves practical “on track” application of knowledge acquired within the classroom situation and includes driving techniques; rectifying faults; safety and safe working procedures; the automatic train protection system (ATP); track tuition on road knowledge; and applicable emergency procedures.

77      It was emphasised in Mr Nedeljkovic’s evidence that a Driver Trainer is responsible for any errors made by Driver Trainees during training.  It is the Driver Trainer and not the Driver Trainee who may be charged with a breach of operating procedures, which may lead to fines, a reprimand or dismissal.

78      The selection criteria and appropriate prerequisites for a Driver Trainer, according to the relevant JDF, were outlined in Mr Nedeljkovic’s evidence.  Furthermore, Mr Nedeljkovic noted the significant changes in the suburban rail transport system from the time of his commencement in 1974.  In particular, he noted the expansion of the rail network and the significant increase in the span of working shifts both during weekly and weekend rail services, such that weekend operations run just under a 24 hour basis with approximately 22 continuous hours of scheduling Monday to Friday.

79      In particular, Mr Nedeljkovic referred to a practice in the late 1990s, where late night services called “night riders” were introduced, and which were accompanied by minimum shift lengths of five hours and increased penalties by payment of double time for hours worked to accommodate expanded services.

80      The movement back to the Award has led, in Mr Nedeljkovic’s view, to a detriment in terms of shift work arrangements, and in particular the loss of shift allowance payments on the occurrence of certain events.  Therefore, in his view, the claimed “block allowance” for shift work, on a Monday to Friday basis, will even out the remuneration of drivers to overcome these difficulties.  Mr Nedeljkovic also gave evidence in support of the applicant’s claim for a penalty payment where less than 48 hours notice of a roster change is given by the respondent, because of the significant disruption to family and social activities that this can cause.

81      Finally, submissions were made by the applicant in relation to the position of Shed Driver.  The applicant claims a margin of 106% of the current drivers’ rate a margin not currently existing.  It is submitted that the Shed Driver carries out a role similar to that of a mainline driver, however, the position is confined within a depot, and involves marshalling and stowing of railcars prior to and after operational use.  Emphasis was placed on the fact that Shed Drivers, as a part of their duties, are required to work in the extremes of weather in both summer and winter, which conditions do not apply to mainline drivers.

82      The applicant also emphasised in its submissions that Shed Drivers provide training to Driver Trainees in the requirements of marshalling and stowing of Railcars.

83      As to the quantum of the claim, Mr Ferguson also referred to discussions between the parties in relation to enterprise bargaining negotiations recently suggesting that the respondent accepted a margin of about 5% as appropriate.

84      Given all of these circumstances the applicant submitted that the margin claimed of 106% for the Shed Driver rate was just and reasonable.

85      Evidence in relation to the Shed Drivers’ claim was given by Mr Thomas.  Mr Thomas is presently employed as a Driver Trainer but was engaged as a Shed Driver from 1996 until 2009.  Mr Thomas was employed by the Government Railways in 1978.

86      The duties of a Shed Driver were outlined by Mr Thomas.  He referred to them as being similar to those of a mainline driver however, noted that a Shed Driver spends a considerable period of his or her time exposed to the extremes of weather over the summer and winter periods.  Furthermore, some Shed Drivers walk up to 14 kilometres per day as a part of their normal duties.

87      Shed Drivers are responsible to the Depot Master and are required to identify railcars for maintenance and cleaning; for the correct stowage of railcars for scheduled passenger services; and the provision of training to Trainee Drivers over a period of some three days or shifts, during which time Shed Drivers train Trainees on all aspects of operating railcars within the confines of a depot.  This includes tuition on stow roads, safe working, safety hazards and signing off on the Driver Trainee’s “shed diary” once the training requirements have been met.

88      Additionally, Mr Thomas referred in his evidence, to the requirement for a Shed Driver to be called upon at short notice to operate on a mainline service.  This will occur occasionally in circumstances where a driver may be either late for work or on track, or has been removed from driving duties because of an on track fatality or other operational incidents.

89      Further submissions were made by the applicant in relation to a range of other claims contained in the applicant’s EO.

90      In relation to shift work, the submission was that the union’s claim for a weekly shift work rate of $113.25 per week is based in principle on the outcomes contained within the National Rail Award 2010 (Cth), an award made by Fair Work Australia, arising from the award modernisation process under the Commonwealth legislation.

91      It was submitted that the rates contained in the federal award have now been incorporated into the respondent’s operations in part, through the Public Transport Authority (Transit Officers) Industrial Agreement 2010.  The claimed $113.25 per week has been arrived at by taking the afternoon and night shift rates of $2.76 and $3.28 respectively, averaging then to a rate of $3.02 per hour, multiplied by 7.5 hours daily over five days per week.

92      The applicant contended that weekly shift allowance payment for five shifts Monday to Friday each week provides certainty in wage outcomes for drivers and also administrative convenience for the respondent.

93      A comparative table of shift work rates prevailing in the other States for railcar drivers was set out in the applicant’s written submissions as follows:

TABLE FOUR

94      In terms of changes in circumstances, Mr Ferguson submitted that since the introduction of suburban railcar services, there has been a significant expansion of the working of shifts over the metropolitan rail network.  Reference was made to the commissioning of the Northern Suburbs railway line in the early 1990s and most recently, the Perth to Mandurah line, which led to greater workloads and greater exposure to working shifts.

95      By way of comparison, the applicant submitted that prior to the 1990s, suburban trains operated generally no later than 11.30pm with services operating every 30 minutes on Monday to Friday.  Over the weekends services generally ran no later than 10pm on Saturdays with a frequency of every 30 minutes.  On Sundays, services ran no later than 9pm with frequencies of 30 minutes.

96      The expansion of the railway network by the Northern and Mandurah services now means that intervals between services have been reduced to 15 minutes on Monday to Thursday shifts, with the last service being midnight, with Friday and Saturday services running to 2.15am. This has led overall, on the applicant’s submission, to suburban rail services operating from about 19 hours per day to now more likely 21-22 operating hours over a 24 hour period, to cater for the expanded community demand.

97      Furthermore, the applicant noted that prior to these changes the Mandurah and Nowergup depots did not exist, as all services left from Perth. Given the expansion of the suburban rail network, and distances to be covered, shifts now commence as early as 3.30am at these depots, to accommodate the new current schedules.

98      Additionally, the applicant submitted that the recent history of industrial instruments supports its contention.  Reference is made to provisions contained in the industrial agreements of 2001 and 2003, carried over into the 2004 enterprise order.  This provided for late night train services to be worked as additional shifts paid at double time rates for services departing between 1am and 3am from Perth.  Additionally, a minimum shift length of five hours applied.  On the reversion of the drivers to the Award, shift work arrangements have returned to the basic shift penalty patterns with no additional compensation for working late night services.

99      In relation to the SERA, the applicant reiterated its earlier contention that the loss of the daily SERA payment to a weekly SERA payment of approximately $141.60 per week, arising from the private arbitration of the Commission in May 2008, has never been accepted by the railcar drivers as a fair outcome.

100   The applicant submitted that despite what were alleged to be errors by the respondent, corrected by the Commission in its decision, the drivers took the proposal of the SERA payment in good faith, and regarded the Award provision agreed to by the respondent as appropriate consideration for moving to disaggregated wage outcomes and giving up the “distance and trip” payment arrangements.

101   In the submission of Mr Ferguson, it was said that “drivers say they shook hands on the deal – only to have their hands severed by lies and falsehoods that followed once they returned to the 2006 Award.”  This is a matter about which, the applicant contended, the drivers still feel strongly aggrieved.

102   The claim for an increase in the SERA to $52.70 per week is based on an adjustment to the originally increased amount of $15.45 added to the SERA, leading to the total amount of $46.35 per week incorporated into the base rate in the 2004 enterprise order. If the $15.45 adjustment back at that time is subsequently increased by 2% annually and is added to the present SERA of $35.40 per week, the claimed amount of $52.70 per week is the result, which the applicant says is fair and reasonable and justified.

103   The drivers are still required, on the applicant’s submission, to continue to make announcements to passengers whilst driving, and have maintained one of the best on time running rates in Australia, presently at around 97%.

104   In relation to shift work, the applicant seeks a new shift alteration allowance for all shifts that are altered by more than 30 minutes which results in a shift commencing prior to 6.30am or a shift which finishes after 6.30pm.  This will not apply to those shift times which are altered by consent of drivers.

105   The claim is based upon disruption to family life and sleep arrangements, caused by late alterations to shifts.  For all alterations to shifts where at least 48 hours notice is not given, the allowance of $25 per shift will be payable.

106   As to overtime, on the making of the 2006 Agreement and Award, and the disaggregation of wage outcomes, the overtime rate increased from 1.5 times the ordinary hourly rate to a new rate of 1.84 times the hourly rate.  This arrangement has similarly extended to other areas of the respondent’s operations, including those for Transwa drivers.

107   In the alternative, if the Commission is not persuaded to increase the overtime rate as claimed, then the applicant submitted that the rate should reflect what is now the national standard, of 1.5 times the ordinary rate for the first three hours and double time thereafter, on a Monday to Friday basis.

108   The applicant seeks a new provision in relation to the working of additional reasonable hours.  What is sought by the applicant is said to reflect the relevant provisions of s 62 of the Fair Work Act 2009 (Cth).  The applicant submitted that such a provision reflects a common sense approach to whether working additional hours should be agreed and that drivers should not be compelled to work longer hours or accept unreasonable roster changes from time to time.

109   In relation to the current disciplinary provisions of the Award, the applicant acknowledges that at cl 2.5 presently the respondent has the power to impose fines on employees for disciplinary breaches which are greater than one day’s pay.  In effect, the applicant submits that there is no limit on the penalty that may be imposed.  Whilst maintaining the general view that penalty provisions such as presently contained in the Award are outmoded, any penalty retained should be limited to a maximum of one day’s pay.

110   The applicant’s position in relation to rostering has two dimensions. The submission was that if the Commission was prepared to accede to its claim in relation to wages, as being based on a median rate across suburban rail systems nationally, then those provisions sought by the respondent in the respondent’s EO, relating to rostering, the guide roster, changes to the guide roster, the operational roster and changes to it, and mutual rostered changes between employees could be accepted.

111   However, the applicant is opposed to any provision within the rostering clause which enables the respondent to roster overtime.  The only exception to this, on the applicant’s submission, is provision so overtime could be rostered for special events such as sports fixtures, concerts etc, on an as needed basis.

112   A number of submissions were made in relation to leave entitlements.  In relation to sick leave provisions, the applicant’s EO seeks the insertion of a provision which reflects payment of Sunday penalty rates when an employee is ill on a rostered Sunday shift.  The applicant submitted this is based upon an earlier proposed order of Smith C in 2008, which was not finalised.  However, the respondent has adopted the approach of paying sick leave occurring in a Sunday shift at the double time penalty rate and the applicant submits that the incorporation of this provision would be fair and reasonable.

113   In relation to long service leave, the applicant’s claim is that employees whilst on long service leave should receive an average of their earnings, calculated over the six month period immediately prior to taking leave. It was submitted by Mr Ferguson that this was based on negotiations which occurred in 2006 leading to the Award and the 2006 Agreement whereby in exchange for moving to disaggregated wage outcomes, the respondent agreed to increase the overtime rate from 1.5 times to 1.84 times the ordinary rate and additionally, pay for payments whilst an employee is on long service leave, would be paid at the rate of the employee’s average earnings.

114   The applicant contended that when the railcar drivers reverted to the Award in 2008, this provision was forgone.  Since that time, in the absence of being able to reach a new industrial agreement, it would be equitable and fair to return the benefit of this provision to the drivers.

115   In relation to various community leave provisions, such as Cultural and/or Ceremonial Leave, Blood and Plasma Donors Leave, Witness and Jury Service, Study Leave, Emergency Services Leave, Paid English Leave Training, and Defence Reserve Leave, the applicant accepts the respondent’s proposed provisions.  Similarly, in relation to the cashing out of leave entitlements, the applicant is in general agreement with the respondent’s proposed clause.  However, reference is made to the respondent’s EO cl 29.2, requiring any request for cashing out of leave to be made within the time period for the Leave Roster Process under cl 30 of the respondent’s EO.  The applicant submits that provision should be made for some flexibility whereby an employee does not make a request within the time provided, and then suffers a particular hardship.

Railcar Driver Group Submissions and Evidence

116   As noted above, the Railcar Driver Group represented by Mr Momber, has filed what it describes as a “Log of Claims” representing conditions claimed by these employees to be incorporated in any enterprise order made in these proceedings.  Save as set out in the Log of Claims, the Railcar Driver Group contend that the remaining terms and conditions be as prescribed by the Award.

117   Mr Momber submitted that one of, if not the main issue in dispute for the purposes of these proceedings, is the wage rates for railcar drivers.  It was contended that despite significant increases in the cost of living, the Railcar Driver Group has received relatively small annual wage increases, comprising flat dollar amounts, arising from State Wage Orders.  These have been less than CPI increases over the comparable period of time.

118   Mr Momber submitted on behalf of his clients, that the drivers’ current remuneration is not commensurate with the work, skill and responsibility of the position.  Additionally, it is contended that comparing rates of pay for the drivers with other train drivers within the respondent’s operations, such as Transwa, their conditions are vastly inferior.

119   Accordingly, a fair and equitable wage increase is justified for the drivers.  This comprises two broad elements. The first is a retrospective adjustment to the Award base rate of pay by progressive CPI adjustments from 1 July 2006, taking the base rate to $1,130.04 per week.  This would mean effectively a lump sum payment equivalent to each driver representing the difference between the actual Award base rate as of 1 July each year from 2006 to date, compared to the adjusted rate.

120   Secondly, the Railcar Driver Group seeks a new pay structure based upon five levels, with drivers reclassified as Technical Officers Level 1 to Level 5.  The Technical Officer base rate for a qualified driver is claimed at $1,245 per week, which represents the average of driver rates across all capital cities in Australia.  Additionally, there is claimed an adjustment at 3% annually in that base rate to a maximum of 5 years.

121   For trainees, the base rate is proposed at 85% of the Technical Officer Level 1 rate.  The Shed Driver, to be retitled Technical Officer Shed is claimed to have a 2.5% margin greater than the relevant Technical Officer Level 1-5.  For Technical Officer Trainer the margin claimed is 105% of their relevant Technical Officer Level 1-5 rate.  For Technical Officer Coordinators, the claimed rate is a margin of 112% of the relevant Technical Officer Level 1-5 rate.

122   The Railcar Driver Group submitted that financial pressures felt by employees, through significant increases in the cost of living in particular utilities and other cost increases imposed by the State Government, are a relevant consideration in the Commission’s assessment of a fair and reasonable rate of pay:  The Executive Director Department of Education and Others (2010) 90 WAIG 615.

123   In relation to the claimed base rate for a Technical Officer Level 1 of $1,245 per week, as an average rate across Australia, Mr Momber contended that such a wage increase is fair and reasonable.  He submitted that in comparative terms, the only other directly comparable drivers to those in Western Australia are drivers employed by Connex in Melbourne, as driver only operated railcars, where the base rate of pay is presently $1,382.02 per week. 

124   It is noted at annexure I to the Railcar Driver Group written submissions that services in Brisbane, Sydney, and Adelaide, are both driver and guard operations whereas the only “driver only” operations, are conducted in Perth and Melbourne.  However, supplementary material filed by the Railcar Driver Group would suggest that driver only operations also exist in South Australia.

125   The wage increases sought by the Railcar Driver Group will, in its submission, assist in the respondent retaining staff and rewarding experience, and will also provide a short and long term saving in driver training and recruitment, which has been a significant cost for the respondent over the last three years.

126   There was also a submission that given the current state of the Western Australian economy, which is recovering strongly, to grant the wages claim advanced by the Railcar Driver Group will not place any pressure on the State’s credit rating or require additional borrowing.

127   Submissions were made in relation to the claim by the Railcar Driver Group for a backdated increase to the SERA.  The submission was made that the private arbitration of the Commission in 2008, led to a significant detrimental effect on railcar drivers of approximately $140 per week.  There was also a submission that, as amplified in the hearing on 15 December 2010, the Award cannot be detrimentally varied as a result of a private arbitration, any such order made was beyond power.

128   Furthermore in relation to the SERA, it was submitted that at the time of the Award being in effect and prior to the consent variation to it following the private arbitration, the SERA was paid on a per shift basis and drivers employed by the respondent at or about this time were offered, and accepted, contracts of employment on the footing that they would receive this rate of pay.  There was no indication by the respondent to such drivers who were offered employment at this time that this significant component of their weekly remuneration was in dispute.

129   Mr Momber submitted that the SERA was originally established in 1991 at approximately 6% of a railcar drivers’ base rate of pay.  The present SERA fails to recognise additional responsibilities of drivers, and is presently set at approximately 3.6% of the base rate.

130   A number of submissions were made about other conditions sought in the proposed enterprise order relating to leave and other entitlements.  Many of these claims are based upon conditions presently applying to the respondent’s salaried officers or office staff covered by The Public Transport Authority Salaried Officers Agreement 2008.  These matters relate to Cultural / Ceremonial Leave; Blood / Plasma Donors Leave; Emergency Service Leave; Defence Force Reserves Leave; salary packaging arrangements; cashing out of entitlements; Witness and Jury Service; Purchased Leave Wage Arrangements and Purchased Leave Deferred Wages.  The general submission in relation to these claimed entitlements was that the railcar drivers should not be treated less beneficially than other staff of the respondent.

131   Furthermore, allowances are claimed in relation to shed working and working shifts.  In relation to shed working, the Railcar Driver Group claim that a driver rostered on the shed roster be paid a 2.5% loading on the Technical Officer Level 1 base rate.  In relation to shift work, it was submitted that the current shift penalties in the Award do not properly compensate drivers for the effect of shift work.  For early morning shifts, a loading of 13.75% is claimed.  For afternoon shifts, a loading of 15.25% is claimed.  For working night shifts, a loading of 20% is claimed in recognition of the effect of shift work on the health and well being of drivers.

132   In relation to the claim for a retrospective lump sum wage adjustment, it was submitted that the Commission has the power to make such an order: Public Transit Authority v The Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch (2004) 84 WAIG 2406 at 2455; The Construction, Forestry, Mining and Energy Union of Workers and Ors v BHP Billiton Iron Ore and Ors (2004) 84 WAIG 3219 at pars 357 and 359; City of Perth and Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Workers Union of Australia, Engineering and Electrical Division, WA Branch and Others AG 160 of 1999 at cl 9.1 (2000) 80 WAIG 490.

133   A further issue in dispute identified by Mr Momber is that related to rostering.  He submitted that the Railcar Driver Group rostering provisions as contained in its log of claims, substantially reflects the existing arrangements in place under the Award.  It is contended that these arrangements should not be altered as proposed by the respondent.

134   The submissions of Mr Momber were supported by a number of witness statements.

135   Two witness statements were filed by Mr Paterson, who is a railcar driver and has occupied this position since April 2008.  Mr Paterson’s initial witness statement dealt with the issue of the SERA.  He testified that when he was appointed as a Railcar Driver he was informed that his conditions of employment were to be in accordance with the terms of the Award.  Mr Paterson said that he was urged by the respondent to read his letter of offer of employment with the attached conditions, including the Award, carefully before accepting the offer.  He did so and accepted the offer on the terms of the Award as it then was.

136   Mr Paterson’s evidence was also that the respondent’s EO, enabling the rostering of an 80 hour fortnight with up to 85 hours, could lead to the respondent rostering a driver 50 hours one week and 30 hours the next week.  Furthermore, the capacity to compulsorily roster overtime is opposed, and the current arrangement, where drivers indicate availability for overtime, is successful and does not require change.  As a consequence of changes sought by the respondent, Mr Paterson raised fatigue management issues, associated with the potential to roster more than 40 hours in any one working week.

137   Cost of living pressures were also the subject of evidence led on behalf of the Railcar Driver Group.  Mrs Patterson testified that she is the partner of a Railcar Driver and said that her family struggles financially. They have difficulty meeting their weekly financial commitments, and with two children, Mrs Patterson has been pressured to return to work in order to make ends meet, and her husband’s wages have not increased to reflect the increasing cost of supporting a family.

138   Reference is also made in Mrs Patterson’s evidence to the impact of Mr Patterson working shift work on family and social events.

139   Mrs Marsh is the wife of a Railcar Driver who has been employed since August 2006.  As a mother of two children, Mrs Marsh referred to the dramatic increases in utility costs over the last three years, and the failure of her husband’s wages to meet these cost increases.  Mrs Marsh works part time to make ends meet, and testified that they have had to take an increase in their mortgage commitments to help pay for their children’s medical and education expenses.  Mrs Marsh also referred to the impact of shift rosters on their family and social life.

140   Ms Doust is the wife of a Driver Coordinator employed by the respondent.  Ms Doust also referred to the increasing costs of maintaining a household, in particular the escalation of utility costs and that her husband’s earnings have not kept pace with the rate of cost increases in these expenses. Furthermore, Ms Doust referred to the unsociable aspects of her husband’s shift work rosters, which interferes with family and social events.

141   The final witness statement on behalf of the Railcar Driver Group was from Ms Coppin.  Ms Coppin is a Railcar Driver and has been employed for six years.  She testified in relation to the increased cost of living she faces, in particular increases in electricity, gas, and other costs, which makes it difficult to make ends meet financially.  Ms Coppin referred to no longer being able to place her children in day care or holiday care while she works, because of the cost, and now having to rely on family care.

142   In her evidence Ms Coppin referred to the requirement as a driver, to undergo six months of on and off track training to gain her position, and a requirement to be reassessed regularly, and undergo biannual training.  Ms Coppin also referred to the real prospect of being involved in a fatality situation, which she said occurs approximately every month or so.

143   Reference was also made by Ms Coppin to the requirement of her shift work roster, that she be available to work early mornings, days, afternoons, nights, weekends, and public holidays, including family days such as Christmas, Easter and New Years Eve and New Years Day.

144   In relation to the SERA, Mr Paterson’s evidence was that it was only whilst he was undergoing training that he became aware that the respondent was in dispute with the applicant in relation to aspects of the Award.  Mr Paterson’s evidence was that when he completed his training, he was shocked to discover that the SERA, which had under the Award at the time he accepted employment, been paid on a daily basis, was then to be paid on a weekly basis.  According to Mr Paterson, this had a significant financial impact, by reducing his income by about $140 per week.

145   It was Mr Paterson’s evidence that at the time of accepting his offer of employment, the respondent should have informed him that the basis of the payment of the SERA was in dispute.  I agree.  At the time that employees were employed as Railcar Drivers under the terms of the Award, important provisions were in dispute between the applicant and the respondent, and those considering employment should have been made aware of this fact.

146   In the case of the SERA, the weekly income of a Railcar Driver under the Award could be significantly reduced, which indeed it ultimately was. For those employees employed at about that time, unaware of the history of the Award and the 2006 Agreement, one can well understand the sense of grievance following the loss of such a significant component of their weekly remuneration, in circumstances where they were not fully informed that this may be in prospect.  I have no doubt that events around this time, certainly for those employees most directly affected, have at least in some part, contributed to deterioration in industrial relations between the respondent and its Railcar Drivers.

147   It was Mr Paterson’s evidence that whilst the respondent’s suburban rail operations are regarded as the best performing passenger rail service in Australia, the Railcar Drivers in this State are the lowest paid.

148   In his second witness statement, Mr Paterson gave evidence about a number of matters.  Mr Paterson referred to the Railcar Driver Group Log of Claims as being fair and reasonable, and considered the appropriate resolution of the current dispute is that an enterprise order, effectively “varying” the Award, be the result of these proceedings.  Mr Paterson contended that the respondent’s EO would not end, but exacerbate the current disputation.

149   In relation to rostering arrangements, Mr Paterson said that the current Award provisions have been effective, and assist in enabling a safe and attractive passenger rail transport service to operate in the community. Mr Paterson disputed the evidence of Mr Appleby, referred to below, in relation to average earnings, and his evidence was that, in reliance upon his own earnings, a true average figure for a Railcar Driver income for 2009-10, exclusive of overtime, is around $64,000 per annum.

150   Furthermore, Mr Patterson disputes the contentions of Mr Appleby that the base rates of pay for Railcar Drivers compare favourably with others in the public transport sector, in particular those for local bus and coach drivers.  When regard is had to length of training, technical knowledge and skill, responsibility for members of the public, consequences of human and technical errors and the specific job requirements, Mr Paterson’s evidence was that there are very significant differences between Railcar Drivers and others.

151   A more relevant comparison, on Mr Paterson’s evidence, is between the work of a Railcar Driver and those train drivers operating on the East Perth / Transwa operations, who earn very significantly more than Railcar Drivers operating on the urban rail network.

152   In particular, Mr Patterson referred to a number of comparisons between urban and Transwa drivers including that urban Railcar Drivers operate on a “driver only” basis whereas Transwa operations have at least one additional staff member on passenger trains; the urban Railcar Drivers are responsible for a significantly higher number of passengers (up to 1,200 passengers per train); have to negotiate many more signals and stations, have a more time critical schedule, and drive greater numbers of kilometres, than regional train drivers; and have an ATP system within the Perth urban rail corridor.

Respondent’s Submissions and Evidence

153   Mr Farrell for the respondent, addressed matters of general principle and matters going to the substantive merit of the respondent’s EO. As an omnibus submission, the respondent contended that its proposed enterprise order is fair and reasonable, with increased wages and allowances over the life of the proposed order as a part of a package of changes and clarifications to wages and conditions of employment. Accordingly, the submission was that the respondent’s EO meets the test of s 42I(1)(d) of the Act, that the enterprise order be fair and reasonable in all of its circumstances.

154   It was broadly submitted that the respondent’s EO will, by the application of the Government Wages Policy, maintain the real value of wages and conditions for the driver employees, and in addition, contains a number of changes to conditions that will facilitate the efficient organisation of work at the respondent consistent with its operational needs, and which changes will either mutually benefit or not adversely affect driver employees.  Alternatively, where any detriment may be demonstrated, the respondent submitted that that detriment may be balanced against the improvement in wages and allowances and other benefits proposed in the respondent’s EO.

155   In terms of principles to apply to these proceedings, the respondent referred to Hanssen v Construction, Forestry, Mining and Energy Union (Western Australian Branch) (2004) 84 WAIG 694 where the Full Bench regarded the making of an enterprise order as “an act of arbitration dealing with the future rights of the parties akin to the award-making power” at pars 82 and 84.

156   Additionally, the Commission should apply the terms of s 42I of the Act, consistent with the objects of the Act, and conclude that the respondent’s counter proposed enterprise order will provide fair terms and conditions of employment:  s 6(ae); will facilitate the efficient organisation and performance of work according to the respondent’s operations and be fair to the employees:  ss 6(af), 26(1)(d)(vi); will be in the interests of the community as a whole in terms of reliable and safe services which are efficient and cost effective: s 26(1)(c); and will encourage agreement making and provide clarification of existing entitlements to reduce potential disputation:  ss 6(ag) and (b).

157   Moreover, Mr Farrell submitted that the application of s 42I(1)(d) of the Act, in terms of the making of an enterprise order that is considered fair and reasonable in all of the circumstances, involves an objective test which cannot be, as in this case, influenced by the views, prejudices, or misconceptions of the parties to the proceedings.

158   There were specific submissions made by the respondent in relation to the status of the Railcar Driver Group as interveners in the proceedings.  It was submitted that in accordance with s 42I(1)(c) of the Act, before making an enterprise order the Commission needs to be satisfied that the terms of the order are terms that might otherwise be included in an industrial agreement between the negotiating parties.  To this extent, the submission was that the terms of any enterprise order that may be made from these proceedings are limited in that they may only provide for a matter that might otherwise be provided for in an industrial agreement between registered organisations, associations and employers, and not individual employees:  Hanssen at pars 75 and 109.

159   It was accepted that the Railcar Driver Group as interveners, have a sufficient interest in the proceedings, however, they are neither a negotiating party nor an organisation or association for the purposes of the Act.

160   It was therefore contended by the respondent that the Commission does not have jurisdiction to make an order as to terms advanced by the Railcar Driver Group as interveners that are not also claimed by the applicant.  This is because they are not terms which might otherwise have been provided for in an agreement between the applicant and the respondent under s 42I(1)(c) of the Act.

161   Furthermore, to the extent that the Railcar Driver Group seeks, by the terms of its claim, to vary the Award, it was contended that there is no jurisdiction to do so arising out of these proceedings.

162   Insofar as the claims of the Railcar Driver Group seek to give retrospective effect to wage increases, Mr Farrell submitted that there was no power available in proceedings for an enterprise order under s 42I of the Act, to do so.  The only powers in relation to the retrospective operation of an order of the Commission are set out in Part II Division 2A of the Act, in particular ss 39(3), 40(4), 40B(4) and 44(13).  The absence of any express power in Part II Division 2B of the Act makes it plain that the legislature did not intend any power to be available to make an enterprise order operate retrospectively.

163   The respondent’s submissions, apart from those as to general principle outlined above, encompass five broad areas.  They were wages; changes to conditions said to benefit employees; changes to conditions to facilitate the efficient organisation and performance of work; clarification of drafting issues in the existing industrial instruments; and some other matters.

164   A key issue arising in the proceedings is of course that relating to wages.  The respondent’s position in relation to the wages claim is clear.  It submits that it is fair and appropriate to apply the Government Wages Policy, which seeks to increase the existing rates of pay by 3.75% and 4% respectively, being the Wage Price Index measures for 2010 – 11 and 2001 – 12, based on the 2010 – 11 State Budget projections.

165   The respondent submitted that the identification of the appropriate base rate and the application of the Government Wages Policy to it leads to the following conclusions.

166   Firstly, the respondent contests the applicant’s assertion that the base rate in the Award resulted from a 5.5% wage increase in return for the “buyout” of “trips and distance” and the disaggregation of wage outcomes.  Mr Farrell submitted that the trips and distance provision contained in the former 1973 award had been bargained away in prior industrial agreements, and did not form any basis for the 5.5% agreed wage increase.  The submission was that, in essence, the wage increase was in recognition of wage disaggregation.

167   Furthermore, the retention in the Award as made in 2006, of the 2006 Agreement base rates, without adjusting for the incorporation of the SERA in the base rate, annual leave loading and the working of a 38 hour week, in net terms, represented an increase of 7% in the value of wages and conditions for the drivers.

168   The evidence of Mr Appleby, the respondent’s Executive Director People and Organizational Development, was to the effect that the exercise of the drivers’ choice to return to the Award in 2006 had a considerable benefit.  In his witness statement, Mr Appleby included a table with the improved benefits of the incorporation of these items in the base rate under the Award, which equated to a weekly value of approximately 6.9% compared to the terms of the 2006 Agreement.  Mr Appleby contended that by electing to revert to the Award, the drivers have voluntarily foregone outcomes that might have been achieved through the enterprise bargaining process.

169   It was also Mr Appleby’s evidence that an analysis of annual wage outcomes from group certificates indicates that the 238 Railcar Drivers, Driver Trainers and Driver Coordinators, for the period 2009-10, earned on average $72,068 inclusive of overtime, with individual earnings ranging from $58,689 to $92,117.  It was contended in Mr Appleby’s evidence, therefore, that when one considers comparisons with other occupations such as local bus and coach drivers, the Railcar Drivers are towards the upper end of the pay spectrum.

170   As to the basis of the applicant’s claim for wage increases, relying on comparisons with other jurisdictions, this was challenged by the respondent.  It was submitted that this approach is now outmoded and the views of Scott C in Civil Service Association of Western Australia Incorporated, the Department of Indigenous Affairs and Others (2004) 84 WAIG 2535 were referred to.

171   Reference was also made to the decision of the Commission in Court Session in Executive Director Department of Education and Others (2010) 90 WAIG 615 at par 105, to the effect that the Commission in Court Session made similar observations about comparisons with other industrial agreements.

172   Mr Appleby observed in his evidence that there are some differences in rail operations in other jurisdictions which may make direct comparisons with those operations potentially misleading.  In this respect, he noted that in Queensland, Queensland Rail works a 40 hour week, whereas the respondent operates on a 38 hour per week basis. Furthermore, when comparing the respondent’s operations with those of Connex in Victoria, the respondent provides paid shift breaks, whereas in Victoria, they are unpaid.

173   Additionally, reference was made to the size and complexity of interstate operations, in the evidence of Mr Gearon, the respondent’s Operations Manager, Transperth Train Operations (“TTO”).  Mr Gearon has been in this position since July 2010 and is responsible for ensuring the efficient, effective and safe operation of the Perth urban rail system.

174   In relation to interstate operations, Mr Gearon gave evidence that of the electrified urban railways across Australia, Perth is the smallest and is the most recently electrified.  He said that the Sydney, Melbourne and the Brisbane networks are also electrified, but both Sydney and Brisbane have been so for many years.

175   On Mr Gearon’s evidence, the fleet of railcars operated by the respondent, which are Electrical Multiple Units (“EMU’s”), contains two main types.  The first is the 48 “A Series” two car sets which have been in service since electrification in 1992.  The second and newer series is the 45 “B Series”, which are three car sets that were introduced in 2004.

176   The trains used by the respondent are of the same kind as those operating on the Brisbane network.  However, Mr Gearon noted that the Brisbane Railcar Drivers are required to have a more expansive knowledge of roads and trains as they have approximately 400 route kilometres of track compared with 173 kilometres in Perth.  Additionally, there are five different train types operated in Brisbane compared to two different types in Perth.

177   There were also comments made by Mr May, the Depot Manager at Claisebrook about interstate comparisons.  He referred in his evidence, to the size of the Melbourne metropolitan rail network, which runs to some 830 track kilometres and four different types of train rolling stock.  There are also considerably more lines and stations on the Melbourne network. 

178   Reference was also made in Mr May’s evidence to the training times that Driver Trainees spend in training across the Australian state metropolitan rail networks.  Perth has the shortest training time of 23 weeks, Adelaide has 28 weeks, Brisbane has 48 to 52 weeks, Sydney has 50 weeks, and Melbourne has approximately 48 to 52 weeks.

179   The differing sizes in the urban rail networks across Australia are also reflected in the numbers of Railcar Drivers, as dealt with in Mr Appleby’s evidence.  The current employee numbers across the railcar classifications are 288 for Western Australia, 1779 for New South Wales, 571 for Queensland, 188 for South Australia and 974 for Victoria.

180   Whilst on this evidence, it has to be accepted that there are differences in scale and complexity between the various interstate urban rail systems, there was no suggestion or evidence to the effect that the essential task of driving is materially different across the urban networks.

181   The respondent also submitted in relation to the applicant and Railcar Driver Group’s claims, that no evidence has been led by them to demonstrate any change in work value of the drivers’ work since 2006.  It was asserted by the respondent that the substantial nature of the work undertaken remains the same.

182   This matter was also dealt with in the evidence of Mr Appleby.  He said that the consent pay rates established in the 2006 Award when it was made expressly incorporated a 5.5% wage increase over and above the previous industrial agreement rate.  Whilst the respondent was unsuccessful in the private arbitration of “unpacking” the base rate to remove any double counting for the 38 hour week, annual leave loading and the incorporation of the SERA into the base rate, the net effect of this was an artificial inflation of the drivers’ rate in the Award.

183   Mr Appleby said that the applicant and the Railcar Driver Group cannot now seek to inflate that rate further by any contentions based upon work value prior to 2006.  On Mr Appleby’s evidence, he said there has been no significant change in work value for the drivers since 2006 to justify any further wage increases.

184   Furthermore, this general proposition also applied to the claim by the applicant in relation to an adjustment of relativities between Railcar Drivers, Shed Drivers, Driver Trainers and Driver Coordinators.  The submission of the respondent was that its offers proposing relativities are appropriate.

185   Mr Appleby’s evidence also dealt with the issue of relativities between classifications.  His evidence was that the respondent supported the restoration of past relativities between the classifications of Trainee Railcar Driver, Driver Trainer and Driver Coordinator classifications with the Railcar Drivers’ rate.  Mr Appleby contended that the Trainee Railcar Drivers’ rate should be 85% of the Drivers’ rate; the Driver Trainers’ should be restored to 105.5% of the Drivers’ rate, which was in the 2004 enterprise order and was the basis of the respondent’s offer in the 2009 enterprise agreement negotiations; and for Driver Coordinators, they should be restored to the relativity of 111.5% of the Drivers’ rate, which was contained again in the 2004 enterprise order, and the Award.

186   The Respondent’s position in relation to Driver Trainers subsequently changed, to support the rate of 106% of the Railcar Driver’s rate.

187   Mr Appleby’s evidence dealt generally with the contentions advanced by Ms Kent, on behalf of the Driver Coordinators.  Mr Appleby’s testimony was the respondent accepted that in early 2007, while the 2006 Agreement was still in effect, there was an informal arrangement entered into between the respondent and the Driver Coordinators.  This was set out in a letter of 18 January 2007 from the respondent to the applicant.

188   This agreement maintained aggregation of the Driver Coordinator’s rate of pay until the commissioning of the Perth to Mandurah rail line; from the commissioning, a new roster for Driver Coordinators would be implemented; and this led to an increase in the relativity from 115.5% to 117% of the Drivers’ rate, at least notionally, as the continuation of aggregation, exceeded this value.

189   Mr Appleby testified that when the drivers returned to the Award, at the end of 2007, a further arrangement was entered into between the respondent and the Driver Coordinators that exceeded the previously agreed 117% relativity rate.  On Mr Appleby’s evidence, he said that it would not be fair to hold the respondent to the 2007 arrangements because there was no detailed work value assessment undertaken of the Driver Coordinator position, it was not possible to implement the new roster because the drivers returned to the Award, an offer of 117% relativity was declined by the Driver Coordinators in the 2009 enterprise agreement negotiations, and the applicant, by its present claim, clearly does not regard itself as being bound by the prior arrangement.

190   Mr Appleby responded in some detail, in his supplementary witness statement, to the evidence of Ms Kent regarding the work undertaken by Driver Coordinators and her earnings history.  Mr Appleby took issue with Ms Kent’s evidence that there has been a significant change in the value of the work undertaken by Driver Coordinators, to justify any significant adjustment to relativities fixed in 2006 under the Award.

191   Whilst accepting that the job analysis study undertaken, and referred to in Ms Kent’s evidence, did conclude that Driver Coordinators had responsibilities in addition to, and at a higher level, than that provided for in their previous JDF, he said that this was not an assessment of work value as such, and should not be so regarded.

192   It was also Mr Appleby’s evidence in reply, that the informal arrangements entered into in 2007 were largely reflective of the significant increase in in-class training, as a result of the opening of the Mandurah line, which meant that Driver Coordinators were working mainly day-shift, and not receiving penalties normally payable on their guide roster.

193   Mr Appleby also disputed contentions made by Ms Kent that the volume of training and assessments since 2007, have continued at a relatively high level.  A table prepared by Mr Appleby and set out in his supplementary witness statement, based on payroll records of Driver Trainee recruitment, disputes the numbers of new drivers trained as alleged by Ms Kent, with the recorded numbers being lower in the years 2006-10.

194   Of some significance also, is Mr Appleby’s evidence that the new training officer position, referred to in Ms Kent’s testimony, will have the effect of relieving Driver Coordinators of almost all of their classroom instruction responsibilities, which will lead to a significant drop in their in-class training workload.  This means that their ability to earn penalties on rostered shifts will not be as affected as has been the case previously.

195   Regarding Ms Kent’s evidence as to her personal income, Mr Appleby also took issue with her assertion that over the last three years her earnings have remained stagnant.  Based on payroll evidence, in the period 2005-06, to the first six months of 2010-11, whilst Ms Kent’s earnings significantly increased during 2007-08, the average increase in her earnings since January 2006 has been around 5% in excess of the relevant CPI for these years.

196   In relation to Shed Drivers, and in particular the claim by the Railcar Driver Group for a shed duties allowance, on Mr Appleby’s testimony this was opposed.

197   Reference is also made to the work of Shed Drivers in the evidence of Mr May.  He gave evidence that some eight drivers are presently based at the Claisebrook Depot and are rostered separately, to primarily work at the depot preparing, shunting, marshalling and assembling railcars rather than driving them in service.

198   Mr May accepted that Shed Drivers are available to drive railcars in service, as relief or where required due to an emergency or unscheduled absence of a driver.  Mr May noted, however, that all drivers are trained and required to be able to perform the work undertaken by Shed Drivers.  It was Mr May’s evidence that whether a driver drives in service, or undertakes shed duties, is primarily a matter of personal preference.

199   In relation to wage increases over the term of the respondent’s EO, it was submitted by Mr Farrell that the application of the Government Wages Policy, granting wage increases according to the Wage Price Index, accompanied by the efficiencies sought by the respondent, is both fair and reasonable.  Alternatively, the respondent submitted that it supported, in the absence of the Commission accepting its efficiency measures, CPI adjustments to the driver’s wages.

200   There were a number of submissions made by the respondent in relation to the Railcar Driver Group claims.

201   As interveners, it was contended that there is no capacity under s 42I of the Act for the Commission to increase the rates of pay prescribed by the Award and moreover, there is no basis for any retrospective adjustment to wage increases under an enterprise order.  These submissions were made in addition to those of a jurisdictional nature, asserting that in any event, as interveners the Railcar Driver Group had no capacity to influence the proceedings beyond the specific claims and counter claims made by the applicant and the respondent.

202   There were a number of other submissions made by the respondent in support of other changes to conditions as set out in the respondent’s EO.  I do not propose to traverse those in detail, other than provide a brief summary of the contentions advanced.

203   The respondent justified its proposed wage increases based on the Wages Price Index, on the footing that it achieved efficiencies in the respondent’s EO.  It necessarily follows, according to the respondent, that the Commission, in making its determination as to an enterprise order that is considered to be fair and reasonable, needs to undertake an evaluation of the relative value of the wage increases proposed, and efficiency measures sought, by the respondent.

204   The matter of the SERA, which as noted above is a controversial issue for the railcar drivers, is proposed, according to the respondent, to be incorporated into the base rate.  Accordingly, it is accepted by the respondent that if this is to be achieved, then there should be some increase in the base rate in recognition of its incorporation.  The respondent proposes that the absorption of the SERA lead to a base rate increase of $30.35 per week, based on the respondent’s roster calculations, and adjusted by reason of its payment for all purposes, including whilst on annual leave.

205   The respondent recognised in its submissions the importance of rostering issues in these proceedings and the extent to which they have led to disputation in the past.  By this application, the respondent seeks to effect some significant changes to rostering arrangements, to improve its operations and to eliminate what it regards as sources of difficulty in the past.

206   The major changes sought by the respondent are a capacity to roster employees fortnightly rather than weekly; to restore the maximum shift length under prior industrial instruments to nine hours per shift (which will reduce the proportion of
“make-up pay” which is a significant cost to the respondent); a capacity to extend the minimum shift length before breaks can be taken from four and a half to five hours; changes to the allocation of rostered days off to enable shifts to encroach on early hours of a rostered day off; the capacity to implement rostering changes pending the operation of a dispute resolution process; and the capacity to alter the period of a roster cycle in consultation with employees.

207   The question of rostering was dealt with in particular through the evidence of Mr Fuller, the respondent’s Service Planning Manager for TTO.  Mr Fuller has held this position for approximately five years and his primary responsibility is to manage the respondent’s computerised train scheduling and rostering system, plan train schedules, consistent with the respondent’s contract and passenger demands, and to investigate train schedules and rosters for productivity improvements.  Mr Fuller has had extensive public transport system planning, scheduling and rostering experience.

208   Mr Fuller outlined the general process for compiling rosters.  This starts with the composition of the guide roster, which provides a template to enable the allocation of employees to regularly timetabled rail services.  A separate guide roster is prepared for each of the three depots at Claisebrook, Mandurah and Nowergup.  The guide rosters are compiled using passenger train timetables, train diagrams, which track a train’s movements each day, and a set of working timetables described as “workers”, for each railcar driver on each working day.

209   Mr Fuller testified that sometimes, the operational roster may differ from the guide roster because of special events that may need to be rostered in, and also because of required maintenance services.  Mr Fuller said that part of the process of compiling a guide roster involves consultation with employees.  This is to ensure there is alignment with the “workers”, and as far as possible, issues raised by employees are taken into account.

210   Mr Fuller commented on the proposed cl 12.7(c) advanced in the respondent’s EO.  His evidence was that this provision, in relation to the posting of a guide roster, reflects the fact that the respondent should have the right to propose a roster to meet its operational requirements, whilst taking into account the views of employees.  Importantly, in Mr Fuller’s view, employees should not have a right of veto over proposed rosters, as long as the process is consistent with the proposed order.

211   Mr Fuller set out in some detail in his evidence the operation and effect of the respondent’s fatigue management process.  The respondent utilises FAID, which is a software programme that calculates the work-related fatigue associated with work periods, so that proposed rosters can be assessed for predicted fatigue and to enable fatigue to be minimised as far as possible.  Each proposed roster is analysed using FAID, and a score, known as the “fatigue score”, is given for every hour worked against defined criteria.  Other urban rail transport operations use the same or similar systems.

212   By way of background to further proposed changes sought by the respondent, Mr Fuller referred to certain rostering principles, which, in his evidence, were supported by research undertaken by the respondent in 2006, by way of a driver roster survey undertaken by an independent market research firm.  In its report of December 2006, the market research report indicated that there was general support for maximising the number of shifts over eight hours and minimising the number of shifts under seven hours.

213   In terms of the specific changes from the Award provisions sought by the respondent, Mr Fuller made a number of observations.  In general, his evidence was that the changes sought will enable the respondent a greater degree of efficiency and also, enable a greater alignment with what research suggested is more reliable from the employee perspective.

214   Firstly, in relation to the proposed fortnightly roster cycle, Mr Fuller said this will enable the spreading of the guaranteed number of working hours over fourteen days rather than a seven day cycle as presently.  Furthermore, the capacity to roster block days of four RDOs per roster cycle can be achieved, rather than only two RDOs on a weekly roster system.

215   Additionally, the capacity of the respondent to roster overtime will enable changes, such as the accommodation of a special event, to be incorporated more flexibly.  This will reduce what Mr Fuller described as the “ripple effect”, that is, consequential changes to other shifts can be lessened or eliminated. Another benefit is the potential for fewer employees to be impacted by such changes.

216   Mr Appleby testified that fortnightly roster cycles are not new for the respondent, having been included in the 2004 enterprise order, and the 2002 and 2006 Agreements. Furthermore, Railcar Drivers in both Sydney and Melbourne, operating on urban rail networks, do so over a 76 hour fortnight.  Accordingly, Mr Appleby’s evidence was that the amendments sought in clauses 12.1, 12.2, 12.3 and 16 of the respondent’s EO, are appropriate.

217   In terms of the roster cycle period, the present rostering over Monday to Sunday is limiting in that it only provides the opportunity to roster weekend work over two weekends in any fortnight. This restricts the capacity of the respondent to spread shift penalties over the roster cycle. It is proposed to remove this requirement, presently in the Award, which will give the respondent some flexibility to consider moving away from the Monday to Sunday cycle, following consultation with the affected drivers.

218   In terms of minimum shift lengths, the respondent proposes that the existing Award provision of a minimum of five hours for a shift for a full time employee remain.  The most significant change is in relation to maximum shift lengths as in the proposed cl 12.4.  The respondent seeks the capacity to provide a maximum rostered shift of nine hours, rather than eight and one half hours presently provided by the Award.  This has been a feature of past agreements.

219   The major benefit of rostering shifts of up to nine hours, on the evidence of both Mr Appleby and Mr Fuller, is the capacity for the respondent to reduce the need to pay “make-up pay”.  This payment is the difference between the total duration of train journeys which a Railcar Driver can be allocated by his or her roster, compared to the relevant train timetables. In any roster cycle, there will be a residue of time which cannot be used for driving. 

220   Having the capacity to roster a longer maximum shift length will enable the possibility of the respondent scheduling an additional journey in any given shift, increasing the overall average hours worked, thereby making it possible to increase the average hours worked per fortnight closer to 80.  Mr Appleby said that in the 2009 – 10 financial year the respondent paid a total of $344,376 in make-up pay to employees under the Award.

221   In terms of shift breaks, the respondent proposes to extend the period for which an employee can be required to continue working a shift without commencing a break, from 4 hours 30 minutes to 5 hours.  Whilst Mr Appleby described this change as “modest”, according to Mr Fuller, such a change will enable drivers to continue driving duties rather than obtaining earlier relief.  Consequentially, this will lead to fewer changeovers and reduces the number of drivers required to operate in particular, the morning peak hour.

222   According to Mr Fuller, this change, if accepted by the Commission, will enable more of the timetable journeys scheduled in peak periods to be performed by fewer drivers.  Furthermore, changes are sought in relation to rostered days off and the ending of a previous shift, in the proposed cl 12.4.

223   Mr Appleby gave evidence that the current Award provision provides a single inflexible definition of an RDO, such that no part of a shift can encroach on the 24 hour period being the actual RDO, without incurring a significant overtime penalty.  As an alternative, the respondent proposes an option whereby if a shift encroaches on an RDO to a maximum of four hours that is ending between 12 midnight and 4am, no shift penalty is incurred by work on the RDO. 

224   What is proposed, however, is an extended minimum period off of 32 hours between the end of that shift and the commencement of the next shift.  Mr Appleby’s evidence was that the disincentive by the payment of the additional penalties has significantly reduced the flexibility in the allocation of night shifts into RDOs.

225   The process for posting the operational roster will, for the first time, be prescribed by cl 12.8 of the respondent’s EO.  No such prescription has occurred previously.  A change will be the posting of the roster three weeks in advance rather than four weeks in advance, as a result of changing the roster cycle from weekly to fortnightly. The practice of posting rosters at least four weeks in advance imposes significant operational constraints on the respondent, according to Mr Gearon’s evidence.

226   Furthermore, Mr Fuller testified that the respondent’s proposal to post a fortnightly roster at least three weeks in advance will still provide, for more than half of the shifts in the roster cycle, an effective four weeks’ notice and will give the respondent a considerable flexibility.  Mr Fuller said he was not aware of any other public transport provider that provides employees with a comparable period of notice of operational rosters.

227   Changes to operational rosters are also dealt with in the evidence of Mr Appleby.  This in essence is described as a concession, as previously it has been a matter of managerial prerogative for the respondent, as long as it acts reasonably. The underlying principle of the change is payment for hours worked which seeks to overcome a perception, as evident in the Railcar Driver Group claim that employees cannot be financially disadvantaged as a result of any change to operational rosters once posted.

228   The respondent’s provision also seeks to make clear that no daily overtime will be payable in circumstances where a change to a posted roster may extend a shift by an hour or so, whilst leaving the employees rostered hours at or under the standard of forty or as proposed eighty per fortnight.

229   This stands in contrast, on Mr Appleby’s evidence, to the proposed Railcar Driver Group claim for a “Roster Change Penalty” for all shift extensions, and also changes to start and finish times of a shift.  The respondent’s proposal also sets out the process by which any proposed change to the roster will be assessed as reasonable, in accordance with stated criteria.  Mr Appleby’s evidence is that the respondent accepts in principle, that any roster changes must be reasonable however it opposes any capacity for employees to “veto” changes through the creation of a dispute.

230   Mr Appleby’s evidence also referred to the respondent’s capacity to roster overtime under cl 12.4 and 12.8.  It is not conceded by Mr Appleby that the respondent does not already have the capacity to roster overtime under the Award rather the proposed arrangements make that capacity clearer. In particular, Mr Appleby refers to the flexibility to be obtained from such a provision, such as the rostering of a special event, and avoiding the “ripple effect”, dealt with in Mr Fuller’s evidence.

231   In terms of overtime penalty rates, Mr Appleby’s evidence was that the proposals of the respondent largely reflect the existing Award arrangements.  In relation to the applicant’s claim for a penalty rate of 1.84 of the hourly base rate for weekly overtime and ordinary hours on Saturday shifts, this is opposed by the respondent.

232   Mr Appleby’s evidence was that whilst the rate claimed by the applicant is consistent with prior enterprise agreements, and some parts of the Transwa Agreement, this was in recognition for disaggregation of wage rates which is not the position with the drivers, in the absence of aggregated rates in the Award.

233   Additionally, Mr Appleby referred to overtime rates in Adelaide, New South Wales and Melbourne, where standard overtime rates apply for Saturday and Sunday work.

234   The respondent also seeks to establish distinctions and clarifications, where additional hours overtime will be payable under cl 13.1 of the respondent’s EO and circumstances where a new proposed shift extension allowance of 0.75 hours pay at base rates, will be payable.

235   Significant changes are sought by the respondent to provisions relating to sick leave.  Apart from drafting issues, the first major change sought is the removal of the entitlement of employees to be paid rostered penalties when on sick leave.  This proposal is based upon an analysis of sick leave patterns undertaken by the respondent, and the concern that the present provisions provide an incentive for employees to take greater levels of sick leave when rostered to work unsociable shifts.

236   The second significant change sought, relates to the general issues of proof of entitlement to sick leave, and largely flows from the disputation that occurred in August and September 2010, where large numbers of Railcar Drivers absented themselves from the workplace and claimed sick leave.

237   The third change relates to a requirement for employees to notify the respondent at an earlier time than present, of their inability to attend for work on the grounds of illness.

238   There were other matters advanced said to be conducive of great efficiencies for the respondent. The first is a change to the notice of termination of employment provision, to provide for the obligation of both parties to give a minimum of four weeks notice of termination of employment.

239   Other more minor changes are sought in relation to the present temporary transfer allowance, the on call allowance, some savings through uniform provisions, and a refinement of the current disciplinary provisions, to make them consistent with arrangements applicable to other employees of the respondent.

240   There is a range of other administrative type of clauses, to which changes have been sought, to promote greater efficiency.

241   A further broad category of changes, were those described by Mr Farrell as of benefit to employees.  It is contended that these should be considered favourably by the Commission when assessing the overall value of changes as proposed in the respondent’s EO.

242   The first, and perhaps most significant, relates to an increase in shift work allowances of some 16%, to standardise shift work rates across the respondent’s workforce.

243   Furthermore, the respondent proposes a number of new leave provisions, including Blood / Plasma Donors Leave, Cultural / Ceremonial Leave, Defence Force Reserves Leave, and Emergency Service Leave, currently not in the Award, and which will confer benefits on the employees.

244   There are also a number of other submissions made by the respondent concerning changes to rostering, which would be of benefit for the employees.  These include codification of existing practices regarding the compilation and posting of the guide and operational rosters; provision for mutual roster changes; the imposition of limits on rostered overtime; limits on the “ripple effect” of roster changes and the evening out of the allocation of shift penalties, achieved by the proposed removal of the requirement that roster cycles commence on a Monday and end on a Sunday.

245   Reference is also made by the respondent to a number of agreed provisions, which in the respondent’s assessment will confer benefits on employees.

246   In terms of the term of the respondent’s EO, as with the Railcar Driver Group, a two year term is supported.  It submitted that the maximum term under the Act will promote a degree of stability.

Minister’s Submissions and Evidence

247   As noted above, the Minister was granted leave to intervene in relation to the application of the Government Wages Policy to the terms of any proposed enterprise order.  The Minister filed written submissions and additionally, witness statements from Ms Berger of the Department of Commerce, and Mr McCourt of the Department of Treasury and Finance.  Ms Berger’s evidence dealt with two issues, they being the development and application of the Government Wages Policy and history of wage outcomes under the Award.  Mr McCourt’s evidence outlines the state of the Western Australian and national economies, and the impact of wages outcomes on the former.

248   In the Minister’s submission, Mr Andretich contended that in proceedings such as the present matter, the Government Wages Policy has been regarded as a relevant consideration, as has been the issue of likely wage outcomes flowing generally to the public sector, as a consequence of applying its terms.  In this regard, the Minister referred to the decision of the Commission in Court Session in The Executive Director Department of Education at par 143.

249   Additionally, it was contended that whilst the Wage Fixing Principles do not have application in enterprise order proceedings, they are relevant in relation to matters concerning work value: The Executive Director Department of Education at par 131.

250   There was also a broad submission, similar to that made by the respondent, that the Commission should not have regard to outcomes arising from bargaining for other enterprise agreements, as those outcomes have turned upon their own particular circumstances: Civil Service Association of Western Australia Incorporated and Others (2004) 84 WAIG 2535 at par 160; The Executive Director Department of Education at par 105.

251   Mr Andretich, in his submissions, outlined the terms of the Government Wages Policy, which commenced on 1 July 2009 and which has applied to all public sector wage negotiations, leading to industrial agreements. The submission was that the State Government, through the making of the policy, aims to achieve public sector wage outcomes that are industrially and economically sustainable. This is given effect by the maintenance of the real value of wages through the application of CPI adjustments.

252   Any wage increase above CPI adjustments, is required under the policy, to be linked to efficiency measures with any increase above the CPI rate to be capped at the level of the Wage Price Index.

253   Additionally, the Government Wages Policy provides that there is to be no retrospective adjustment to wages and conditions of employment as a general rule.

254   The overall submission of the Minister in relation to these matters was that the Government Wages Policy leads to outcomes which are fair and reasonable and maintains the real value of wages in the public sector.  Furthermore, the outcomes contemplated are consistent with the State Government’s overall economic objectives, and maintain downward pressure on labour costs, and hence, the prices of the provision of government services.

255   Considering the terms of the applicant’s and the Railcar Driver Group’s claims in these proceedings, the Minister contends that the wage increase sought cannot be justified outside of the terms of the Government Wages Policy, as no productivity or efficiency measures have been advanced in support of them.  Furthermore, it was contended by Mr Andretich, that contrary to the assertions made by the Railcar Driver Group, the rates of pay prescribed by the Award have generally been maintained at or above the rate of inflation for Perth in the period January 2006 to July 2010.

256   An issue raised by the Minister in his submission is the potential for a flow on of any significant wage increase arising from these proceedings to the general public sector.  This is particularly so, as the submission went, because wages represent approximately 40% of State Government expenses.

257   On the broader economic front, the Minister submitted that both the Western Australian and the national economies are recovering from the economic slowdown of 2008 – 2009.  In particular for the national economy, the Reserve Bank of Australia forecasts gross domestic product to grow by 3.5% in 2010 – 2011, 3.75% in 2011 – 2012 and 4% in 2012 – 2013.

258   In the case of the Western Australian economy, the broad submission of the Minister was that the outlook for growth in the State economy is positive, although the stronger sector is mining and resources, with patchy conditions in some other different sectors of the economy.

259   In terms of the State Government’s budget position, the general submission of the Minister was that the State Government does not have the financial capacity to pay increases beyond the terms of its Wages Policy.  Whist reference is made to the operating surplus of $831,000,000 in 2009 – 2010 there also has been a significant cash deficit of $867,000,000, arising from significant capital expenditure.

260   Additionally, in the period ahead, the State Government is required to make significant investment in social and economic infrastructure in order to accommodate the State’s population growth and to encourage further economic development.  The importance of maintaining healthy State budget surpluses is emphasised in the Minister’s submission, so as to avoid the requirement to increase borrowings and hence, interest costs.

261   In a supplementary submission, following the release of the 2010 – 11 Mid-year Financial Projections Statement on 17 December 2010, the Minister contended that whilst there have been some revisions to the economic and financial projections outlined in Mr McCourt’s evidence, the key themes remain largely the same.  In particular, it is noted that despite the improvement in the overall financial position for 2010 – 2011, relative to the Budget projections, the State Government’s revenues will come under increasing pressure as a result of the State’s decreasing share of the national GST revenue, combined with substantial economic and social infrastructure investment.

262   Whilst general economic conditions have improved since the Budget, risks remain to the global economic outlook.  Furthermore, with State Government revenues increasingly coming from mining royalties is the issue of the corresponding sensitivity to exchange rate movements against the US dollar.

263   In his further submission, the Minister contended that despite the general improvement in economic conditions in the State for 2010 – 2011, any significant wage increase as claimed by the applicant has potential for flow on through the total public sector, potentially putting pressure on the projected surpluses for 2010 – 2011 and 2011 – 2012.

Consideration

264   Before considering the merits of the specific contentions of the parties and interveners, in light of the significant body of evidence adduced in these proceedings, there are some threshold issues to be considered.  I deal with those issues now.

Statutory Scheme

265   Section 42I of the Act, empowering the Commission to make an enterprise order, is contained within Division 2B of Part II, dealing with industrial agreements.  Section 42I relevantly provides as follows:

“42I. Commission may make enterprise orders

 (1) If —

    (a) the Commission declares under section 42H that bargaining has ended between negotiating parties; or

    (b) the person to whom a notice is given under section 42(1) does not respond to the notice within the prescribed period or responds with a refusal to bargain,

   the Commission may, upon an application under subsection (2), make an order (an enterprise order) —

    (c) providing for any matter that might otherwise be provided for in an industrial agreement to which the negotiating parties referred to in paragraph (a), or the initiating party and the person referred to in paragraph (b), were parties, irrespective of the provisions of any award, order or industrial agreement already in force; and

    (d) that the Commission considers is fair and reasonable in all of the circumstances.

 (2) An application for an enterprise order may be made —

     (a) where subsection (1)(a) applies —

   (i) if the negotiating party in respect of whom the declaration was made is not an organisation or association of employers, by the negotiating party; and

   (ii) if the negotiating party in respect of whom the declaration was made is an organisation or association of employers, by an employer who is a member of the negotiating party;

  and

     (b) where subsection (1)(b) applies —

(i)                 if the initiating party is not an organisation or association of employers, by the initiating party;

   (ii) if the initiating party is an organisation or association of employers, by an employer who is a member of the initiating party.

 (3) An application for an enterprise order may be made —

    (a) where subsection (1)(a) applies, within 21 days after the making of the declaration; and

    (b) where subsection (1)(b) applies, within 21 days after the end of the prescribed period.

 (4) Without limiting section 32A, the Commission may exercise its powers of conciliation in relation to a matter even if an application for an enterprise order has been made in relation to the same matter.”

266   Furthermore, ss 42J and 42K of the Act are also relevant.  Section 42J sets out the effect of an enterprise order made by the Commission, and s 42K deals with the term of an enterprise order, which is limited to a maximum of two years from its commencement.

267   It is plain from the terms of s 42J(3) that once made, an enterprise order is to be given primacy over any existing award or industrial agreement, extending to and binding those subject to the enterprise order.

268   That the terms of s 42I are within Division 2B of the Act is of some significance.  This is because enterprise order proceedings are part of the process of agreement making under the Act, whereby the Commission is ultimately called upon to resolve a dispute, by the making of an order.

Approach to Section 42I Applications

269   The general nature of s 42I proceedings was canvassed by the Full Bench in Hanssen.  In this case the Full Bench analysed the statutory scheme, commencing with the objects of the Act.  The Full Bench observed at pars 81 – 84 as follows:

81 This illustrates the fact that the Commission is a participant in processes under Part II Division 2B in certain circumstances, including the circumstances which obtained here.  In making an enterprise order, it is trite to observe, the Commission must act according to equity, good conscience and the substantial merits of the case without regard to technicality or legal forms (see s26(1)(a)).

82 Further, a s42I(2) application is not an inter partes matter of the kind referred to in the authorities cited above.  An application under s42I(2) is not a cause of action nor does it relate to a cause of action or a suit.  It is an act of arbitration dealing with the future rights of the parties akin to the award-making power.  The Commission, in making its decision, is required to have regard for the interests of the persons immediately concerned, whether directly affected or not, and, where appropriate, for the interests of the community as a whole (see s26(1)(c)).  That illustrates that the proceedings are not inter partes.  In addition, there are matters such as the state of the national and state economy and the need to encourage employers and employees and organisations to reach agreements appropriate to the needs of enterprises and the employees in those enterprises.  There are also matters such as the need to facilitate the efficient organisation and performance of work according to the needs of an industry and enterprises within it, balanced with fairness to the employees in the industry and enterprises are required to be adverted to.  (These matters need to be adverted to pursuant to s26(1)(d)(i), (ii), (iii), (vi) and (vii) respectively).  There are other matters, too, under that section which the Commission is required to take into account which are not directed necessarily to the interests of the parties to the application before the Commission.

83 It will be clear from the outline of the objects of the Act, and the manifestation of them in Part II Division 2B of the Act, that the Division provides a scheme for the parties to reach agreements, inter alia, in enterprises by collective bargaining, the end result of which bargaining is an agreement which can be registered and which is then enforceable pursuant to the Act.  The Commission has a role in the process by conciliation and arbitration.  Finally, if the bargaining process is not successful, a party who is a negotiating or initiating party in the bargaining process, for such an agreement, may invoke the Commission’s jurisdiction to make an order as it were, in lieu of the agreement, but enforceable as if it were an award.  It is noteworthy that an enterprise order enables the Commission, in the proper exercise of its discretion, to stand in the shoes of the parties and make an order providing for any matter that might otherwise be provided for in an industrial agreement, had it been reached by the parties, we would add.  Further, the order must be one considered fair and reasonable in all the circumstances by the Commission and the making of which was considered fair and reasonable.  What the Commission is doing, however, is confined to the completion of the agreement process which a party or the parties commenced themselves and were unable or unwilling to complete.  Thus, the application for an enterprise order is part of a process where the parties have the carriage of it in order to reach an agreement but where the Commission can intervene by conciliation and/or arbitration at any time to resolve the dispute and the process.  In the end, an enterprise order is an order made to resolve a dispute.  The ability to apply to the Commission under s42I(2) and (3) is to enable the Commission at the behest of a party to fulfil its major role to resolve disputes as part of the end of the process commencing with an initiative in bargaining to achieve an industrial agreement.  The entitlement to make such an application as that under s42I(2) is not the only way in which the matter can come to the Commission.  It is an application to resolve a dispute and is a procedural step.  It is not the enforcement of a remedy, nor is it the pursuit of a right conferred anew on it apart from the Act (see also the power of the Commission to intervene under s32, s32A and s44 of the Act).

84 The process is about agreeing, and, in the absence of agreeing, determining rights and obligations arbitrarily and industrially.  S42I(2) and (3) are part of that process and one step in it.  The matter cannot therefore be characterised as a cause of action which depends on its being pursued within a specific time for its validity.  It is a mere procedural prescription in a continuing process commenced under s42 of the Act.  Therefore, such an application cannot be characterised as or in the manner of a cause of action or suit in the courts, and certainly not one which is void ab initio if not commenced within a prescribed time.  Further, s42I(3) does not prescribe a limitation to the invocation of a remedy such as a statute of limitation does.  The section is part of a dispute resolution process based on agreements and ultimately resolvable by an enterprise order or by s32 or s44 conciliation and/or arbitration.  No new right, in any event, is created other than a procedural right to seek resolution of the process where no agreement has been reached according to statutory prescription.  Accordingly, quite clearly, s27(1)(n) of the Act can be used because s42I(3)’s prescription of a time limit is a “prescribed time” within the meaning of s27(1)(n) and within the meaning of the word “prescribed” as defined in s5 of the Interpretation Act 1984 (as amended).  S27(1)(n) reads as follows:-

“(1) Except as otherwise provided in this Act, the Commission may, in relation to any matter before it —

…

(n) extend any prescribed time or any time fixed by an order of the Commission;”

270   Further, at pars 109-111 the Full Bench said:

109 The terms of such an order are limited.  They are limited to providing for any matter that might otherwise be provided for in an industrial agreement to which the initiating, negotiating or other prescribed parties were parties.  Also, the Commission can only make provision in the order for matters which the Commissioner considers fair and reasonable in the circumstances.  In our opinion, that clearly means that the Commissioner stands in the shoes of the parties and constructs, in lieu of an industrial agreement, orders which are in the same terms as such agreement were it reached and contained fair and reasonable conditions.  The role of the Commissioner is therefore to determine also whether there should have been an agreement and what matters the enterprise order, in its place, ought to provide for, asking himself whether it is fair and reasonable to make the order sought, in all of the circumstances, therefore.  The Commissioner must make a finding, therefore, that there are matters which might otherwise have been provided for in the agreement between the prescribed parties, and, second, that the Commissioner considers it fair and reasonable to make the order, in all of the circumstances.  There are only two steps in the process.  This, of course, means that the Commissioner must consider and apply s26(1)(a), s26(1)(c) and, if applicable, s26(1)(d).  It is inevitable that one of the circumstances to be considered will almost always be whether the terms sought are fair and reasonable and therefore the two considerations contained in s42I(c) and (d) were, to some extent, overlapped.  It is also fair to say that, if the terms of the order sought might have been contained in an agreement between the parties, which has to be found before the Commissioner can proceed, then that sort of finding may often go a long way to determining whether the terms are fair and reasonable and whether even sometimes it is fair and reasonable to make the enterprise order sought.”

271   Thus, the proceedings leading to the making of an enterprise order, are akin to the arbitration of an award and involve the Commission standing in the shoes of the parties, and making an order in respect of matters that may have been agreed by the parties to any proposed industrial agreement, and which the Commission considers to be fair and reasonable.  This is plainly a two step process.

272   The general approach to s 42I of the Act was affirmed by the Full Bench in Sealanes (1985) Pty Ltd v The Shop, Distributive and Allied Employees’ Association of Western Australia, and Others (2004) 84 WAIG 3158.

273   As noted from the terms of s 42I, the Commission is required to do two things.  Firstly, consider whether the issues for consideration in the enterprise order proceedings are “matters” that might otherwise be provided for in an industrial agreement to which the negotiating parties were a party.  Secondly, that any order containing such matters is fair and reasonable in all of the circumstances.

274   A further issue is the construction of s 42I(1)(c) of the Act, which has arisen in these proceedings in relation to the status of the Railcar Driver Group as an intervener.

Role of Interveners and Section 42I(1)(c) Act

275   As noted above, it is contended by the respondent, and supported in submissions of the Minister, that as the Railcar Driver Group are not a negotiating party, nor an association or organisation for the purposes of the Act, they have no capacity to expand the terms of the enterprise order sought beyond those contested by the applicant and the respondent.  This is so, as the argument was put, because they are not terms that might otherwise have been provided for in an agreement between the applicant and the respondent, for the purposes of s 42I(1)(c) of the Act.

276   The Minister, albeit traversing somewhat outside of his remit in terms of the limited intervention granted to him, made submissions along similar lines.  The Minister contended that the Railcar Driver Group has no status under the Act.  As such, it is not able to engage in negotiating binding industrial agreements or to apply for a variation to an award under s 40 of the Act.

277   Further, the Minister submitted that as an intervener, the Railcar Driver Group should only be allowed to support or oppose the positions adopted by the  applicant or the respondent, and should not be permitted by the Commission to the expand the issues to be determined in these proceedings: Re State Administrative Tribunal; Ex parte McCourt (2007) 34 WAR 342.

278   In this case, the Railcar Driver Group did not wish to become parties to the proceedings, even after their application for leave to intervene was granted by the Commission.  This is despite the fact that in earlier proceedings, leading to the interim order, the Railcar Driver Group was joined as parties to the proceedings, individually.  Furthermore, the Railcar Driver Group cannot seek to vary the Award from these proceedings for two reasons.

279   Firstly, this application is made under s 42I of the Act seeking the making of an enterprise order.  An application to vary an award must be made under s 40 of the Act, and comply with the procedural requirements of s 29A of the Act.  Whilst there can be a variation to an award arising from proceedings under s 44 of the Act, and there are s 44 proceedings still on foot involving the parties to this application and the Railcar Driver Group, it is not appropriate to use submissions and evidence led in these proceedings for those purposes.

280   There may also be difficulties in seeking to vary the Award as the Railcar Driver Group are not an organisation bound by the Award and hence they do not have standing under the Act to seek to vary it.

281   As to the scope of the intervener’s role, for the following reasons, I am not persuaded by the submissions of the respondent and the Minister, that the role of the Railcar Driver Group, as an intervener, is as limited as has been contended.

General Principles

282   The capacity to intervene is created by statute.  Historically, it has existed in only limited jurisdictions and on a limited basis.

283   The admiralty jurisdiction has allowed intervention where a person has a substantial interest to protect, but only to the extent required to protect the interest and only in order to raise defences open to the parties.  Similarly in probate, a person whose interest might be affected by an action has been permitted to intervene but had to take the cause as it was at the time of intervention. Intervention was permitted on an even more limited basis in the matrimonial causes jurisdiction. (See Hutley JA in Corporate Affairs Commission v Bradley (1974) 24 FLR 44 at 47 – 51 and Debelle J in Hocking v The Southern Greyhound Racing Club Inc (1993) 61 SASR 213 at 219 – 220.)

284   The restrictive view of the role of an intervener with respect to intervention generally in civil proceedings is illustrated by Debelle J in Hocking at 221:

“One of the privileges of a party is the right to define the issues…I do not think that an intervener has that right.  Instead, he must take the issues as he finds them subject only to the right to protect his own interests.

As in the cases of interveners in Admiralty jurisdiction, the Corporation’s intervention is to protect its interests.  It is, therefore, appropriate in the case of the Corporations intervention to apply the principles limiting the extent to which an intervener can participate which have been developed in the Admiralty and Probate jurisdictions.”

285   In Hocking King CJ said at 216:

“Neither the general concept of intervention as understood in the jurisdictions in which it exists, nor the words of the section “right to intervene and be heard in”, provide support for the argument that the Corporation may raise issues not raised between the original parties…The Corporation, when exercising its right … to intervene in the action of another, must be limited to the support of or opposition to the claims and issues raised by the existing parties to the action.”

286   Similar statements regarding the role of the intervener have been made by the Court in Re State Administrative Tribunal at par 41:

“…in the absence of any statutory intention to the contrary, an intervener, unlike a party, will ordinarily be allowed only to support or oppose a position contended for by one or other of the parties to proceedings and will not be permitted to expand the issues to be decided. “

287   It is of importance in the present matter, that the Court in the quote above recognised the role of statutory context, which I will come to shortly.

288   Significantly, the Court also said at par 38 that the discretion to grant leave to intervene is, in its terms, unconfined. In that regard, reference was made to observations of Mason J in Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 40 where it was said:

“…where a statute confers a discretion which in its terms is unconfined, the factors that may be taken into account in the exercise of the discretion are similarly unconfined, except in so far as there may be found in the subject matter, scope and purpose of the statute some implied limitation on the factors to which the decision maker may legitimately have regard…”

289   For this reason, the Court, at par 42 had specific regard to the objectives of the SAT Act, including minimising costs and avoiding delay.

290   Debelle J in Hocking at 221 refered to the rationale for an intervener having a limited role in proceedings:

“There are sound reasons of policy for restraining the extent to which an intervener can participate in an action instituted by others.  Generally speaking, the initial protagonists know the ambit if their dispute and the issues they wish the Court to determine.  Courts are concerned to limit participation by interveners lest that participation extend the issues beyond those which the initial parties have defined and so increase the time and the action and thereby increase the cost to be incurred by the parties.  That concern was expressed by the Court of Appeal in New South Wales in Tindle v Ansett Transport Industries (Operations) Pty Ltd (1990) 21 NSWLR 492 at 497:

It is most unusual to permit individuals or corporations who are not parties to participate in the resolution of the issues joined between parties to proceedings in a court.  It is unusual precisely because the purpose of pleading and of modern court procedure is to ensure that issues are refined and defined so that they can be resolved with accuracy, fairness and efficiency.  The participation of interveners tends to be discouraged because of the addition of time and cost which their intervention occasions and because they issues which they may wish to argue may not infrequently broaden the ambit of the court’s inquiry as the parties to the proceedings wish to confine it.”

Intervention in Industrial Matters

291   Typically, the role of the intervener in industrial matters has been interpreted more broadly than in other jurisdictions.  Not only are industrial tribunals not courts of pleadings, but they are often dealing with the creation of future rights and obligations, rather that the ascertainment and enforcement of existing obligations, as in strictly judicial proceedings.  These are important distinctions for present purposes.

292   A clear statement of the different approach was made by Mason J in The Queen v Ludeke; Ex parte The Customs Officers Association of Australia (1983) 155 CLR 513 at 522-523.  After referring to the general principle applied in the United States and in constitutional cases in Australia that intervention be allowed only where the applicant has a legal interest to protect, Mason J stated:

“No doubt the [Australian Conciliation and Arbitration] Commission in exercising its discretion…will pursue a somewhat similar approach, making due allowance for the circumstance that it is a tribunal, not a court, and that the nature of the determinations which it is called upon to make in the sphere of industrial relations will require some reformulation of what is a relevant or necessary interest for the purpose of intervention.  An interest which in its nature is inadequate to support intervention in legal proceedings in a court may be sufficient to support intervention in a matter of industrial arbitration before the Commission.”

293   Although this noted difference relates to the interest required to intervene rather than the scope of intervention allowed, it is a clear indication of the need to take a different approach to intervention in industrial matters.

294   This different approach is marked, in particular, by the emphasis on natural justice.  The rules of natural justice require that where a person’s rights will be affected by an order of the Commission, they must be given a full and fair opportunity to be heard.  Gibbs CJ in Ludeke at 519 to 520 said:

“…it is clear that notwithstanding the wide discretion in matters of procedures given to the Commission … the Commission is bound to observe the rules of natural justice.  That means that a person whose rights will be directly affected by an order made by the Commission must be given a full and fair opportunity to be heard before the order is made.”

295   In Re Media, Entertainment and Arts Alliance and another; Ex parte Arnel and others (1994) 179 CLR 84 Mason CJ, Brennan, Dawson and Gaudron JJ at 88-89 said:

“The award making power of the Commission is not restricted by the relief claimed or the demands made by the parties.  It is, however, confined by the rules of procedural fairness.  And prima facie at least, the decision of the Full Bench with respect to differential rates was reached in circumstances where the parties were denied an opportunity to be heard on that aspect of the various matters in issue.”

296   See also The Australian Liquor, Hospitality and Miscellaneous workers Union v Burswood Resort (Management) Ltd and another (1996) 76 WAIG 1281.

297   In Ludeke Mason J at 526 referred to the “high importance and urgent need to settle industrial disputes”.   His Honour then said at 527:

“Indeed, the principal object of intervention is to ensure that all interested parties will participate in a single resolution of a controversy instead of being relegated to a resolution of the controversy in several proceedings.  It is the attainment of this object that justified intrusion into the litigant’s right or interest in pursuing his proceedings as he chooses to constitute them.”

298   In Re Australian Education Union and Others; Ex parte State of Victoria and Another (1994) 58 IR 1 the Industrial Relations Court of Australia also considered the rationale for allowing intervention in an industrial matter (under s 470 of the former Industrial Relations Act 1988 (Cth)).  The court stated, as a preliminary consideration at p 7, “The legislature having left the Court’s discretion otherwise unfettered, the Court should not itself impose fetters” then went on to consider the rationale for allowing intervention. 

299   The Court referred to United States Tobacco Co v Minister for Consumer Affairs (1988) 20 FCR 520, which dealt with an application to join proceedings as an amicus curiae, indicating that the rationale for allowing an intervener or amicus curiae to participate in proceedings is the same.  The Court cited United States Tobacco Co as follows:

“Nevertheless, a court has an inherent or implied power, exercised occasionally, to ensure that it is properly informed of matters which it ought to take into account in reaching its decision.  Particularly is this so in judgments which may affect the community generally or persons other than parties who are before it. (534)

The general principle is that the parties are entitled to carry on their litigation free from the interference of persons who are strangers to the litigation.  But there is an overriding right of the court to see that justice is done.  An amicus may be heard if good cause is shown for doing so and if the court thinks it proper.  Nothing in these reasons should be understood to delimit or restrict the availability or effectiveness of this valuable tool. (536)”

300   The Court then listed considerations relevant to whether a party will be given leave to intervene. This included the nature of the interest; the assistance the court is likely to derive from the intervention; and the effect of the intervention on the parties including whether the intervention will increase costs for the parties or raise issues the parties are not ready to meet.

301   In this case the proper scope and construction of provisions of the Act in ss 6, in particular (a), (af) and (ca), 26(1) and 42I(1)(c) are important in considering the role of the Railcar Driver Group as an intervener as a part of the statutory context under which the intervention power is exercised by the Commission.  In many respects, the circumstances of this particular case are unique.

302   I have already set out parts of Division 2B of Part II of the Act above. For the purposes of the first step required by s 42I(1) the Commission, if it decides to make an enterprise order, is by s 42I(1)(c), empowered to provide for “any matter” that might “otherwise” be provided for in an industrial agreement between the parties.  In my opinion, it is placing an overly restrictive construction on s 42I(1)(c) to limit the scope of the Commission's capacity to make an enterprise order, only to those specific claims and counter claims advanced by the negotiating parties, who are parties to the proceedings for an enterprise order.

303   In my opinion, the focus of this provision is on “matters” that might be contained in an industrial agreement, which of course, include industrial matters as defined in s 7 of the Act.  By the plain words of that definition, this is a broad range of matters.  Furthermore, it is the case that there is no necessity for all of the subject matter of an industrial agreement, to be industrial matters, so long as at least some of the matters contained in an industrial agreement can be so characterised:  Hanssen at pars 272-277.

304   In my view, it is incontestable that the matters advanced by the Railcar Driver Group, in their “Log of Claims”, being wages and conditions of employment, are industrial matters as defined in s 7 of the Act.  The subject matter of the claims and counterclaims of the applicant and respondent are also incontestably industrial matters for the purposes of the Act.  These are plainly matters that may be provided for in an order of the Commission made under s 42I of the Act. 

305   Even if one were to adopt the more restrictive approach to the role of interveners in civil proceedings referred to in the authorities above, then what the Railcar Driver Group have raised are limited to the subject of the proceedings, that being matters that may be included in an enterprise order pursuant to s 42I of the Act.

306   Additionally, the Railcar Driver Group, as interveners, and employees of the respondent covered by any enterprise order arising from these proceedings, are persons who will be directly affected by the outcome of the proceedings, as will the applicant and respondent, as parties principal.  Indeed and importantly, they are the subject of the proceedings, as no other employees are to be directly affected.  It is therefore, entirely consistently with Ludeke, appropriate that they be heard fully in relation to the matters that may be the subject of an order of the Commission, arising from these proceedings.

307   Furthermore and importantly, in terms of the proper construction to be placed on s 42I(1) of the Act, by s 26(2) of the Act, it is provided that “in granting relief or redress under this Act the Commission is not restricted to the specific claim made or to the subject matter of the claim.” There is nothing in s 26(2) to indicate that the wide scope of that provision should be read down, having regard to the specific terms of s 42I.  There is nothing in s 42I of the Act, in the sense that an application for an enterprise order will contain “specific claims” or the “subject matter of the claim”, that the general power in s 26(2) available to the Commission cannot have application in proceedings of this kind.

308   This reinforces the width of the discretion given to the Commission in dealing with the industrial matter before it.  Similarly, it also reinforces the observations of the Court in Ludeke, to the same effect, in relation to the role of interveners.

309   It is clear from the terms of s 26 read as a whole that it is to apply to all proceedings before the Commission, and in my opinion, it would require very plain language in another provision of the Act, to exclude its operation.  An example of the express exclusion principle, is s 26(1a), which provides that the terms of s 26(1)(d) do not apply to proceedings before the Commission under s 50A of the Act.

310   That is not to say, however, that the terms of s 26(2) of the Act, operate in an unfettered manner.  In my opinion, there is still some necessary nexus required to be demonstrated between the terms of the Commission’s order in any particular matter before it and the relief claimed by a claimant.  In dealing with such claims by a claimant in any proceedings, the Commission may grant redress or relief on a different basis to that claimed.

311   For example, a claim by a claimant for an increase in wages by a certain amount, may lead to an order granting a lesser or greater amount.  Alternatively, a claim in relation to payment for an amount of money by reason of an allowance for a disability may be dealt with by the Commission by the making of an order providing for different relief, such as the provision of protective clothing in respect of any such disability:  Re Application by the Australian Workers Union, WA Branch (1981) 61 WAIG 628.

312   Thus, to the extent that the applicant and respondent have advanced a range of different claims in these proceedings for an enterprise order, regarding wages and conditions of employment, to the extent that the Railcar Driver Group has also advanced “claims” in relation to such matters, that is wages and conditions of employment, then in my opinion, the Commission can have regard to the contentions of the intervener as they bear upon those claims, and as governed by s 26(2) of the Act.

313   This is, however, controlled by the terms of s 26(3) of the Act, such that the Commission, if it intends to take into account any matter or information not raised before it in proceedings, in determining those proceedings, is obliged to afford the parties concerned an opportunity to be heard as to those matters.

314   All of these statutory provisions must also be applied consistent with the objects of the Act in particular s 6(a), (af) and (ca).

Fair and Reasonable

315   As to the second element in making an enterprise order, the Commission is required, by s 42I(1)(d) of the Act, if it decides to make an enterprise order containing the specified matters, to do so on terms that are “fair and reasonable”.  In my view, the statutory requirement imports an objective test as to fairness and reasonableness. This must of course, be read subject to the overriding requirement imposed on the Commission by s 26(1)(a), to decide the matter according to equity and good conscience and the substantial merits of the case. 

316   It perhaps needs to be restated, that the requirement to decide matters according to equity and good conscience, means according to my good conscience:  Perth, Fremantle, and Suburban Bread Carters’ Industrial Union of Workers v Coastal Master Bakers’ Industrial Union of Employers (1903) WAAR 71 per Parker J; Metropolitan Shop Assistants’ and Warehouse Employees’ Industrial Union of Workers v Foy & Gibson Pty Ltd (1912) 11 WAAR 113 per Burnside J.

317   Additionally, it is trite that the application of this overall obligation on the Commission under s 26(1)(a), is also to be read consistent with the objects of the Act in s 6 and also the relevant provisions of s 26(1)(d).

318   The requirement for the Commission to be satisfied that, in all the circumstances, the terms of an enterprise order are fair and reasonable, begs the question as to how such an assessment is made.  Accepting that the test is an objective one, the question arises, as was put by the Commission to the parties during the proceedings, fair and reasonable relative to what?  

319   This issue was raised in the context of the submissions by the respondent and the Minister, eschewing any notion that the principle of comparative wage justice, as advanced by the applicant, can be revived.  In this respect, as noted, reference was made to the observations of Scott C in Civil Service Association where at par 160, the Commissioner made the observation that in relation to community movements there must be some caution and that comparative wage justice is not available as a basis for salary increases.

320   In my view, with respect, those observations need to be considered in context.  In the matter before the Commission in those proceedings, consideration was being given to the terms of an industrial agreement to cover the entire public service in this State in proceedings under s42G of the Act, in relation to matters about which the parties could not agree. Taken in context, the Commission’s observations in that matter must be seen consistent with the circumstances of that particular case.

321   Similarly, the observations of the Commission in Court Session in The Executive Director Department of Education at para 175, are to be considered in context and are distinguishable.  In that case there was an attempt by the applicant to use disparate occupational groups for comparative purposes.

322   If the observations of Scott C in Civil Service Association were intended to have broader application, as a matter of general principle, then with respect, I disagree with them.  There is no statutory foundation for such a broad assertion, under the Act.  It is true that notions of comparative wage justice in the strict sense, have long since passed their zenith, when, some decades ago, it was a central pillar of principle in relation to centralised wage determination by industrial tribunals in Australia.

323   With the evolution towards bargaining at the enterprise level, from the early 1990s, far greater focus is now paid to the negotiation of terms and conditions of employment directly between the parties at the enterprise level. Within this framework, awards are regarded more as a safety net, underpinning bargaining outcomes, which are given lawful effect by registration as industrial agreements under State and federal legislation.

324   That is not to say, however, and in my opinion it would be quite wrong to conclude, that in an appropriate case, having regard to the particular circumstances arising, no regard can be had to terms and conditions of employment that may apply to the same or similar occupations to those under consideration in any particular case, elsewhere.  To turn a blind eye to that factor, in a situation where comparisons may be relevant, would in my opinion, be at odds with considering a matter according to the equity, good conscience and the substantial merits of the case, which by s 26(1)(a) of the Act, the Commission must do in exercise of its jurisdiction.

325   The weight to be given to such a factor will be entirely dependent upon the circumstances before the Commission.  Particularly in proceedings such as these, where the Commission’s Wage Fixing Principles do not apply, and where the Commission effectively “stands in the shoes of the parties” in determining the terms of an order which are fair and reasonable, for the Commission to do so with its eyes completely closed as to developments elsewhere, where those circumstances have been raised as a central issue by a party to the proceedings, would be wrong in my view.

326   To adopt this approach, and to foreclose consideration of terms and conditions operating in like circumstances, would be to fail to have regard and to apply, the relevant provisions of the statute.  The Commission needs to be cautious in not imposing any artificial gloss upon the statutory obligations placed on it by the Act, in the discharge of its jurisdiction and powers, merely because that may be consistent with the desired outcome of a party to proceedings.

327   The Commission’s overarching statutory duty is to enquire into and deal with industrial matters referred to it, having regard to the full requirements of the Act, primarily in accordance with equity, good conscience and the substantial merits of the case before it.

328   It is to be noted that even in Hanssen in the decision of Gregor C at first instance, Construction, Forestry, Mining and Energy Union Western Australian Branch v Hanssen Pty Ltd Project Management (2003) 83 WAIG 3220, whilst disavowing the concept of comparative wage justice in considering the terms of the building industry enterprise order before him, Gregor C concluded at par 27 that the terms and conditions of the proposed order were “not greatly less or more than might be expected by a contemporary building industry employer working on building works in the central business district of the city”.

329   Gregor C in reaching that conclusion, informed himself of those matters by examining building industry industrial agreements registered in this Commission and the then Australian Industrial Relations Commission.

330   On appeal the Full Bench held that this approach, that is Gregor C informing himself in this way without giving the parties an opportunity to be heard, was in error and fell foul of s 26(3) of the Act.  This was an error of law which was fatal to the validity of the enterprise order made by the Commission, and led to the order being quashed.

331   However, on any examination of Hanssen there was to a degree, a comparative assessment made by the Commission, in reaching the view that the proposed enterprise order in that case, was “fair and reasonable” for the purposes of s 42I(1)(c) of the Act.

332   Further consideration of these matters was given by the Full Bench of the Commission in Sealanes.

333   This matter involved an appeal from a decision of the Commission at first instance, making an enterprise order binding the appellant and the respondents engaged in the industry of storage and distribution of foodstuffs.  The appeal essentially turned on a challenge to that part of the enterprise order made by the Commission, awarding a wage increase of $100 per week to the affected employees.

334   Comparisons between the affected employees and other employees of employers in the same industry, featured prominently in the proceedings before the Full Bench.  In his decision, Sharkey P, (Wood C generally agreeing) concluded that it was appropriate to have regard to comparative awards and agreements covering employees in the same industry as the appellant.  Sharkey P, at pars 170 – 179, observed as follows:

“170 By that ground it is alleged that the Commissioner used comparatives, awards and agreements to justify an increase in the payment for ordinary hours of work when that increase should only have been considered in terms of Sealanes’ capacity to pay in relation to the business it carries on and the competition it faces in the market place.

171 The capacity to pay is one of the factors which the Commissioner is bound to consider in this case in the capacity of its competition, for the reasons which I have expressed above (see s26(1)(d)(iii) of the Act).  It may be a determining factor, as any factor may be, but, in this case, it is not.

172 The Commissioner did use comparative awards and agreements to justify an increase in wages and was entitled to use them.

173 In my opinion, the Commissioner was entitled to have regard to what was paid to employees of the same and similar classifications employed in Foodlink, which was admitted by Mr Power to be a competitor of Sealanes, and to compare awards and agreements and reach a conclusion about the application by comparing it with other persons who might be established to have been competitors or who were engaged in the same industry as well.  Rand, Clelands, P & O and Foodlink were, on the evidence, in the same industry.  More relevantly and importantly, they were subject to the awards and parties to EBAs registered in this Commission.

174 The enterprise order is confined to 13 employees.

175 I also observe that it was accepted that a number of other employers described as competitors are subject by common rule to the same award.

176 Therefore, what they pay to their employees in the same or similar classifications is relevant.  Some attempt was made to distinguish employers said to be competitors, on the basis that they were multi-national companies or companies which were members of multi-national groups, or subsidiary companies in them.

177 Other attempts were made to distinguish competitor employers and in the same industry on the basis that they did not sell or buy goods but stored them for other people and distributed them for others.

178 No distinction was attempted on the basis that the drivers and storemen and freezer workers and other employees did substantially the same work in all of the relevant enterprises although, in one premises forklifts were used more than in Sealanes premises.  However, substantially, the classifications in each were the same.  In this case, the enterprises involved relevantly the similar organisations engaged in the collection by truck, the storage, the picking and loading of goods and the distribution of goods by truck afterwards, either by sale or by delivery to or for their owner.  Thus, agreements and the conditions under them entered into by the persons under the same award who are competitors of Sealanes and who carry on similar or comparable enterprises, are entirely relevant and should have led to the conclusion that the AWAs produced a base wage at the lower end of what was paid for warehouse and distribution employees subject to other industrial instruments to which I have referred above.

179 One of the strongest points of comparison was the industrial agreements made between the unions, Sealanes, Rands, P & O and Clelands, particularly the EBAs registered in this Commission.  The strongest point of comparison is agreements to be registered in this jurisdiction for award employees and what is paid under them, as well as what is actually paid otherwise by employers subject to the award and/or engaged in the industry.  That is because what is achieved by collective bargaining or paid in this and other jurisdictions as a base rate is comparable to what was ordered here where the enterprise order is made when collective bargaining fails.”

335   Whilst the appeal was in part upheld in that case, it was for the reason that the Full Bench concluded, by majority, (Beech SC and Wood C), that the Commissioner at first instance had not paid sufficient regard to evidence given in the matter before her, as to specific flexibilities and productivity increases available to the employer, arising from the enterprise order.

336   This must be read in light of the Commissioner’s conclusion at first instance in that case, that there were significant economic advantages to the respondent employer, in exchange for the $100 per week wage increase.  It was on that narrow basis, and on the particular facts of the case, that the appeal was upheld, and the matter remitted to the Commissioner at first instance for further consideration of that point.

337   Whilst in the Minister’s written submissions, reference was also made to a decision of the Full Bench in Integrated Group Limited t/as Integrated Workforce v Construction, Forestry, Mining and Energy Union of Workers and Skilled Rail Services Pty Ltd (No 2)  (2006) 86 WAIG 2706, that case is distinguishable.  The decision of the Full Bench in that case, and in an earlier appeal before it, Skilled Rail Services Pty Ltd v Construction, Forestry, Mining and Energy Union of Workers (No 1) (2006) 86 WAIG 2509, turned on the application of the Wage Fixing Principles, specifically those dealing with new awards and extensions to an existing award, in terms of structural efficiency principles.

338   Those circumstances have no application to this matter.

339   Alternatively, if, to the extent that the Full Bench, at par 94 in Skilled (No. 2) is to be taken to have held more generally that comparative assessments of wages and conditions elsewhere, can never have a role to play in the setting of wages and conditions for employees then in my view, the approach of the Full Bench in Sealanes is to be preferred, in particular as being concerned with an application under s 42I of the Act.

340   From the foregoing consideration, for the purposes of s 42I(1)(d) of the Act, in the context of what the Commission considers “fair and reasonable”, the considerations are not just limited to the immediate needs of the enterprise.  The Commission has a wide discretion, always subject to the objects of the Act in ss 6(ae), (af), (ag), (ca) and ss 26(1)(a) and (d).

341   In my view, consistent with these terms of the Act, it is not inappropriate to have regard to industrial agreements and arrangements existing in the same industry and applying to the same occupation elsewhere in the State or other jurisdictions, where the essential nature of the work is the same or substantially the same.  That is not to say that some caution should not be exercised in doing so.

342   In my opinion, this is plainly what at least in part the bargaining parties may do in the context of enterprise agreement negotiations under the Act, and into whose shoes the Commission steps, at least in part, under s 42I.

343   As an aside, merely in passing, I refer to the Government Wages Policy itself, as set out in the “Bargaining Process Guidelines”, a copy of which was annexed to the witness statement of Ms Berger. Under its terms, the relevant government agency, as a part of its preparations for enterprise bargaining, is required to “provide national comparative wage and conditions data for its occupational groups for BCC.”  The Commission understands that the “BCC”, is the relevant “bargaining coordination committee”.

Status of Private Arbitration

344   Mr Momber submitted that the Railcar Driver Group was substantially aggrieved by the decision of the Commission on 18 July 2008 in the private arbitration between the respondent and the applicant.  It was contended that the loss of the SERA, formerly paid on a daily basis, and determined to be paid on a weekly basis as a consequence of those proceedings, was considered by the Railcar Driver Group as a major setback and the cause of much disputation between the parties.

345   In relation to the private arbitration, Mr Momber mounted a jurisdictional attack upon the order to vary the Award, made by consent on 8 October 2008.  Mr Momber submitted that there was no capacity under the Act for the Commission to engage in any form of private arbitration, and thus, any subsequent award variation, be it by consent or otherwise, arising from those proceedings, was invalid.

346   Mr Farrell, in supplementary submissions filed by the respondent in relation to this issue, contended that the consent variation to the Award of 8 October 2008, following the private arbitration, was a valid order of the Commission.  It was submitted by the respondent that the basis on which the parties reach consent, is not relevant to the validity of an order subsequently varying an award by consent.  It was further contended that by reason of ss 44(4) and 37(4) of the Act, it is not open to mount what is in effect, a collateral attack on the validity of an order varying the Award in these proceedings.

347   In my opinion, for the following reasons, the submissions of the Railcar Driver Group in relation to this matter cannot be accepted.

348   By s 34(4) of the Act, an order of the Commission once made, is, subject to the Act, immune from challenge and is final.  Of course, the terms of s 34(4) of the Act do not prevent an application for prerogative relief to the Supreme Court, in the case of the Commission acting outside of its jurisdiction or powers: Re Halliwell Ex Parte Australian Builders Labourers Federated Union of Workers WA Branch [1990] AILR 124.

349   Subject to the foregoing, in my view, it is not open for the Commission, by way of a collateral attack, to challenge the terms of a consent variation to an award.

350   In making an order varying an award by consent, prima facie the Commission is acting within jurisdiction and power.  It is giving effect to the agreement of the parties to an award, that its terms be varied. This will be subject to, where they apply, the terms of the Wage Fixing Principles.

351   In this matter, the Award was varied by consent, following a private arbitration.  As I have already observed, whilst this was quite an unusual course, in my opinion, there can be no question as to the validity of the order varying the Award arising from that process. The only qualification to this general proposition is the capacity of the Commission to set aside proceedings by reason of a failure to comply with the terms of the Industrial Relations Commission Regulations 2005, pursuant to reg 38.  No suggestion was made that the order made by the Commission varying the Award following the private arbitration was affected by error of that kind.

352   For these reasons, I regard the order varying the Award arising from the private arbitration proceedings as valid.

Form of Order

353   The parties are apart as to the form of any enterprise order.  The issue is whether the enterprise order incorporates the terms of the Award as a stand alone instrument, or is to be read in conjunction with the Award. The applicant contends for the latter proposition and the respondent the former.

354   In my opinion, the position of the respondent is to be preferred.  Given the history of a multiplicity of industrial instruments applying to the parties to these proceedings, there is much to be said for one industrial instrument to prescribe all terms and conditions of employment for the term of any enterprise order to issue arising from this application.

Term

355   Given the history of the industrial relations between the parties in this matter, I consider that a period of stability is important.  Accordingly, I determine that the term of any enterprise order to issue in this application will be for the maximum prescribed by s 42K(2), that being two years from the date upon which it comes into operation.

Government Wages Policy

356   The position of the respondent and of the Minister has been set out earlier.  The Government Wages Policy history and its terms are set out in the evidence of Ms Berger.  That evidence is not contentious and I accept it.

357   By s 26(1) of the Act, the Commission is required to take into account a range of matters in dealing with industrial matters coming before it. It is the case of course, that the Government Wages Policy has no particular status before the Commission. It is a plain statement of policy by the State Government that remuneration payable to employees of government departments and agencies resulting from direct bargaining, is to be subject to some limitation.

358   The Commission will have regard to the Government Wages Policy, as a relevant consideration, along with all other relevant considerations under s 26(1)(a) to (d) of the Act.

The State Economy

359   By s 26(1)(d)(ii) of the Act, the Commission is required, “where relevant”, to take into consideration the State economy.  This issue is dealt with in some length in the Minister’s written submissions and the evidence of Mr McCourt. The Commission also takes into account the terms of the Annual Report on State Finances 2009-10 of September 2010 and the Mid Year Economic Review, published on 17 December 2010. This latter Review was dealt with in the Minister’s supplementary submissions filed on 23 December 2010.

360   In Mr McCourt’s evidence, he referred to an overall strengthening of economic conditions globally, nationally and in Western Australia, following the global financial crisis. Mr McCourt referred to most forecasters’ expectations that economic activity will grow at and above trend rate at the short to medium term.

361   In terms of the Western Australian and national economies, Mr McCourt referred to projected growth at a reasonable pace in the absence of risks to global growth materialising. Whilst noting the strengthening of the State economy, Mr McCourt also mentioned that since the 2010-11 State Budget the proposed Mineral Resource Rent Tax has caused some uncertainty.  Additionally, a softer housing market has followed rising interest rates along with a dampening of consumer expenditure.

362   In general terms, Mr McCourt referred to the need for the State’s finances to be maintained in a sound and stable way.  No party contested this proposition and nor could they.  Mr McCourt also asserted that the State Government does not have the financial capacity to pay wage increases beyond those prescribed by the Government Wages Policy if that goal is to be achieved.

363   Furthermore, whilst the general government sector achieved an operating surplus of $831m in 2009-10, due to significant capital spending, the sector spent more than it received with a cash deficit of $867 m.

364   Additionally, Mr McCourt referred to other contributing factors to the State’s revenues. These include a decline in GST share, weaker consumer spending, generally weaker housing market conditions and the impact of an appreciating Australian dollar on mining royalty revenues.  With the increasing population growth in the State, comes a requirement to invest in social and economic infrastructure which will significantly increase the asset investment program from previous years.

365   In relation to the Mid-Year Review, the Minister noted that whilst there have been some revisions to the economic and financial projections, the overall thrust of Mr McCourt’s evidence remains.  Particularly, it was submitted that despite the improved budget position for 2010-11, and the upward revision to revenue across the forward estimates, the projections in relation to key financial aggregates for 2013-14 are generally in line with the Budget projections.

366   Whilst I do not propose to traverse the adjustments to the various forecasts as set out in the Minister’s supplementary submissions, it is of note for present purposes that the WPI for 2010-11 is forecast to grow by 4.25%, an upward revision of 0.5% from the Budget.  For 2011-12 the forecast WPI is projected to be 4.25%, an upward revision of 0.25% compared to the Budget.  Thus, the projections as now revised are higher than the respondent’s proposed wage increases as contained in the respondent’s EO, being based on the WPI projections contained in the State Budget.

367   The forecasts for WPI for 2012-13 and 2013-14 remain unchanged. The CPI forecast for 2010-11 of 2.75%, is unchanged from the Budget.

368   Overall, from this evidence and the submissions, it can be concluded that the State’s economy is recovering strongly from the effects of the global financial crisis, and the demand for the State’s mineral resources will underpin sustained growth into the future.  However, the State’s revenue growth will be subject to increasing demands for social and economic infrastructure, and the risks as outlined in Mr McCourt’s evidence.  Additionally, one cannot discount risks to global economic recovery as evidenced by difficulties experienced by some European countries presently.

Terms of Enterprise Order

369   The Commission considers that an enterprise order should be made.  In light of the foregoing, I now turn to the specific terms of the enterprise order to issue, focussing on the most contentious provisions in the first instance.

Wages

370   The issue in relation to the wages claims of the applicant and the Railcar Driver Group is not, in the main, one based on any significant change in work value.  This is except for the evidence of Ms Kent, dealing with changes said to have arisen in the work of Driver Coordinators.  As outlined earlier in these reasons, the applicant’s claim is fairly and squarely based upon a comparative assessment of a fair rate of wage having regard to wage rates prevailing in other urban rail transport networks throughout Australia.

371   At the outset, I do not consider there is any basis for past CPI “catch-up” wage increases, as claimed by the Railcar Driver Group. Such a claim is inconsistent with the evidence of Ms Berger, which evidence I have considered carefully.  Ms Berger’s testimony involves an analysis of State Minimum Wage increases as compared to CPI increases in the period 2006-2010. Tables set out at attachments C, D and E, to Ms Berger’s witness statement indicate that over this period of time, adjusted for inflation since 2006, the real wages for railcar drivers have increased by a small margin of about 2.6%.  This is as against the Railcar Driver Group claims, for a lump sum payment of $12,859.31 per employee.

372   It is to be accepted that as a consequence of flat dollar adjustments to the Award rates since 2006, there has been a compression of relativities in the classifications in the Award.  However this is the case with all awards of the Commission, where State Wage Orders are in the nature of flat dollar adjustments as opposed to percentage increases. 

373   Based upon the evidence before me, it is not open to conclude that the Award rates have not generally kept pace with inflation.  Therefore, I am not able to conclude that there is, on the materials before the Commission in these proceedings, justification for any lump sum adjustment to base rates, even if there was statutory power under the Act to do so.  This latter issue is one I deal with later in these reasons when considering the issue of retrospectivity.

374   Furthermore, whilst dealing with these issues, I am not persuaded to depart from the classification structure as presently prescribed by the Award. The classifications of Driver Trainee, Driver, Driver Trainer, and Driver Coordinator, are broadly consistent with other jurisdictions that operate urban public rail transport systems.  The use of “Technical Officer” also has connotations for other areas of the respondent’s operations as outlined in the evidence of Mr Gearon. 

375   The existing classifications are also consistent with the history of industrial instruments applicable to the parties over many years.  I see no good reason to depart from the existing classification structure.

376   The history of wage movements between the parties has been outlined in some detail in the evidence.  As a consequence of the making of the Award and the 2006 Agreement, wages increased by about 13.5% over some two years.  In May 2009, just prior to the implementation of the Government Wages Policy effective 1 July 2009, the respondent offered to the Railcar Drivers, in enterprise bargaining negotiations, a wage increase of 15% over three years which incorporated a performance pay component of 1% in the second and third year based on on-time running performance.  No other significant changes to existing conditions of employment were sought by the respondent at that time.

377   That offer was rejected by the drivers and they remained on the terms of the Award.  The level of that offer, however, must have reflected the respondent’s then assessment, at least to some degree, of the worth of the work of those covered by the Award.

378   In these proceedings, the respondent seeks significant changes to existing conditions of employment, in particular in relation to shift work, rosters, overtime, the incorporation of the SERA into base rates of pay, and a number of other efficiency measures. In particular, reference is made to the evidence of Messers Appleby, Fuller and May, which suggests that such changes will be of considerable benefit to the respondent, in terms of efficiencies in its operation, and direct cost savings.  I have had regard to all of that evidence in determining this matter.

379   The enterprise order to be made by the Commission should reflect the needs of a modern urban rail transport operation. The respondent should have the flexibility to enable it to respond to operational changes as may be required, balanced with maintaining fair outcomes to its employees.

380   In terms of the applicant’s approach to the issue of wages, I consider it strikes a fair balance in terms of rates of pay, by the adoption of a median rate across different State operations.  I regard such an approach in the context of this case as being fair and reasonable.  It takes account of differences in the operations in each of the States.  In particular, I have had regard to the evidence of Mr Gearon, in terms of his initial and supplementary witness statements, where he sets out in some detail, based upon his own knowledge and experience, the nature of those other operations.  Those factors include:

(a)              The level of size and complexity of the interstate operations;

(b)             All State urban rail systems are electrified, except for South Australia, which still runs diesel locomotives;

(c)              All operations have mostly automatic signalling, except for some manual signalling operations in Victoria and New South Wales;

(d)             The ATP system operates in Perth only;

(e)              Subject to there being some differences in route kilometres and track kilometres averages and the ratios for trip length, network speeds and track kilometre / stations are very similar and there are similar average distances between stations across each network;

(f)               There are differences in training times as already noted on the evidence;

(g)             All operations are government run, except for Victoria which is in private hands; and

(h)             All State operations operate on a seven day/shift work basis.

381   I also accept the evidence and the submissions of the applicant, that comparative assessments of Western Australian drivers and their Eastern States counterparts have been the source of angst amongst the driver group.

382   The work of Railcar Drivers is responsible work by which they are required to transport large numbers of members of the public across the respondent’s urban rail network.  They must do so in a safe and efficient manner in accordance with the respondent’s operational requirements and railroad procedures.  The drivers do so exercising skill and responsibility, and they continue to perform an important community function.

383   It is also the case the respondent’s operations are very efficient and are highly regarded in terms of comparisons with other State operations. The efficiency, skill and diligence of the Railcar Drivers have contributed to this performance which should be recognised.

384   From the inspections undertaken on site, the Commission has a good understanding of the work of railcar drivers and the conditions under which they operate.  These inspections, and discussions with drivers on the job, have been helpful in informing the Commission and understanding the evidence led in these proceedings.

385   However, it is to return to the past to have regard to the circumstances, and reasons for the Railcar Drivers electing to go back to the Award in 2006.  Having done so, they must take the responsibility for this decision and which decision must have been then taken, based on an assessment that that was the best course of action for the drivers at that time.  The evidence of Mr Appleby establishes that there were some financial advantages from this decision for the drivers.   This must also be seen, albeit historically, in the context of the failure of the parties to reach agreement on a new industrial agreement in 2009 and the continuation on Award conditions since that time.

386   In the context of the history of the relationship between the parties and the Railcar Driver Group, in my view it is important to set base rates of wages, to provide a measure of stability in the respondent’s operations for the term of any enterprise order, but which are both fair and reasonable. I accept that some comparison with other urban rail networks in Australia is appropriate in the circumstances of this case.

387   In doing so, I do not take the highest or the lowest rates of pay as comparators, but a median comparator, as being a fair assessment of the worth of the work of railcar drivers generally.  I also have regard to the recent history of negotiations between the parties and the respondent’s own assessment of the worth of the work of drivers. 

388   As dealt with earlier in these reasons, there is no suggestion, and nor could there be in my view, that the essence of the work of railcar driving is materially different in each jurisdiction.  It is the case that there are matters of scale and size, dealt with in the evidence, which is comprehended in taking a median approach. Such an approach, adopting an average or median, is not without precedent in this jurisdiction: Amalgamated Metal Workers and Shipwrights Union of Western Australia v Hon Minister for Transport and Others (1984) 64 WAIG 1338.

389   In the context of this matter, it follows that I do not consider the respondent’s wage proposals as being fair and reasonable in all of the circumstances. The inflexible application of a policy or rule in the circumstances of this case, will not, in my view, lead to the resolution of the present dispute.

390   It is illusory to suggest the approach to wage determination in cases such as these, can have any scientific basis.  The Parliament has, by the Act, conferred a broad discretion on the Commission.  In the context of the somewhat unique terms of s 42I of the Act, the search must be for what I regard as fair and reasonable terms and conditions of employment. As was said by Sheldon J, in the New South Wales Teachers Case in another context at 522:

“Too meticulous a search for principles can often result in the wood being missed for the trees.  The Commissions’ statutory charter to arrive at what is “just and reasonable” leaves it with wide discretions and in this I think the Parliament was wise.  I propose to examine this case in its own setting and base the salaries I would fix on an assessment of this work and its responsibilities.”

391   In my view, those observations have some force in the context of s 42I enterprise order proceedings.

392   I have given careful consideration to all of the submissions and the very large volume of evidence adduced in these proceedings.  I have also closely examined the various industrial instruments having application not only throughout the respondent’s operations, but those having application in each of the other State urban rail transport systems. 

393   I have also examined the further helpful material contained in the respondent’s supplementary submissions of 21 February 2011, the Railcar Driver Group supplementary submissions of 20 February 2011, and those of the applicant of 22 February 2011, detailing wage and relevant allowance movements under the various industrial instruments applicable in the various State operations since 2006.  These figures are generally consistent, subject to the observations made by Mr Farrell in his submissions.  The applicant also accepts the accuracy of the rates comparison in Attachment B to the respondent’s submission.

394   There was also a brief submission in reply on 23 February 2011 from the respondent to the applicant’s further submissions.

395   As to the comparisons, whilst noting the matters referred to immediately below, the differentials between the other States and Western Australia were modest as at around December 2007, as contended by the applicant.  This was up to the time that drivers in Western Australia remained under the 2006 Agreement, prior to reverting to the Award in January 2008.

396   Since that time however, the analysis reveals a widening gap in wages outcomes as between the other States and Western Australia.  This must be considered in the context of the observations in Mr Appleby’s evidence, of the value of the “award package” that incorporated aspects of the 2006 Agreement, on the reversion by the drivers to the Award.  

397   There are some differences of note in relation to the other State operations that must be considered.  For example Queensland operates on a 40 hour week basis, therefore requiring some adjustment back to any comparison with its rates of pay to reflect a 38 hour week comparator.  Additionally, the current Queensland rates of pay include penalty loadings expressed as a “full flat rate” and there is therefore a need to disaggregate this rate. In the case of Adelaide, whilst an aggregate rate is also paid, from the industrial instrument, one cannot readily “disaggregate” the rate for comparative purposes.

398   In New South Wales the rates of pay also include an industry allowance, which also needs to be excluded. These matters were helpfully dealt with in the supplementary witness statement of Mr Appleby at annexure 1 for 2010 rates.  There are also other differences such as the payment of distance payments in New South Wales and South Australia for trips in excess of prescribed distances per shift.  In the case of South Australia, the distance payment is part of the aggregate rate.

399   Making the adjustments that can be readily made, leads to a median rate of pay for the other State operations of $1,133.73 for 2010.  For 2011, the median rate of pay is $1,180.22.

400   It is to be taken into account by the Commission, that the railcar drivers had the benefit of an award rate increase of $17.50 from 1 July 2010, flowing from the State Wage Case Order at that time. This is for the full fiscal year to 1 July 2011 when, by s 50A(5) of the Act, any further adjustment of the State Wage order is to take effect.  This must be weighed in the balance in an assessment of a fair and reasonable outcome.

401   Subject to what follows in relation to the SERA, based upon the material before the Commission, I consider that on the making of the enterprise order, as a matter of equity and good conscience, the base rate of pay for a railcar driver will be $1,133.73, payable from the first pay period on or after the date of the enterprise order. This wage increase will be inclusive of the interim wage increase of 5% flowing from the earlier order of the Commission on 29 September 2010.

402   There will be a second wage increase to $1,180.22 per week, which will be phased in over 2011 and 2012.  In all there will be three increases staggered over the life of the enterprise order as follows:

(a)              From the date of the enterprise order the base wage rate will increase to $1,133.73 per week;

(b)             From 1 September 2011 the base wage rate will increase to $1,156.97 per week; and

(c)              From 1 June 2012 the base wage rate will increase to $1,180.22 per week.

403   In my view, these wage increases for Railcar Drivers will provide a fair and equitable base from which the Commission expects the parties to bargain on the expiry of the enterprise order.  There will be a term in the enterprise order that the parties, three months prior to its expiry, commence negotiations for a new industrial agreement to replace the enterprise order.

404   The Commission’s decision in relation to this matter is not to be regarded as establishing any nexus or relationship for future purposes, but only for the determination of the present dispute.  Nor can the result of these proceedings, turning as it does upon the specific circumstances of this case, be relied upon by the parties, or any other persons, as the foundation for any claims made in any other contexts.  There will be a term of the enterprise order to this effect.

Driver Coordinators

405   In relation to the Driver Coordinators, I accept the evidence of Ms Kent that based upon the Skills Council Report of June 2006, some work of Driver Coordinators was not adequately reflected in the JDF for the position.  Whilst the skills assessment was not of itself a work value assessment, it is a necessary first step in considering any change in work value. The Commission in these proceedings is entitled to, and does, take into account that evidence, in its assessment of the applicant and the Railcar Driver Group positions. 

406   I accept, consistent with Mr Appleby’s evidence, that the training workload as contended by Ms Kent may have been an over estimation.  Relevant also, is the prospect of the new Training Officer position in the near future, although it is difficult to make an assessment of this factor at this point in time. 

407   From all of the material before the Commission, I do not consider that a margin of 111% in the Award is an adequate reflection of the work of Driver Coordinators.  I see no reason in principle, based upon the assessment of the work undertaken by Driver Coordinators that the relativity that was agreed between the parties in 2007, and as again offered by the respondent in 2009, without substantial changes to conditions of employment had that offer been accepted, should not be restored.

408   It must be regarded that the agreement reached in 2007, and the offer made in 2009, reflected at least an informed view by the respondent, as to the worth of the work of Driver Coordinators. This to a degree is supported by aspects of the Skills Council Report.

409   Additionally, the 117% margin as then applicable reflects the present margin for Driver Coordinators under the Transwa agreement. I also see no reason in principle why it should be materially different in the context of the Driver Coordinators and Railcar Drivers in the TTO operations, given the history to which I have referred.  Thus the margin for the life of the enterprise order will be 117%.

Driver Trainers

410   I am not persuaded on the evidence and submissions to depart from the respondent’s amended position, to restore the Driver Trainer relativity to 106% of the Driver’s rate.  Driver Trainers will receive the benefit of the increase to apply to base rates of wages by the application of this margin under the enterprise order.

411   Furthermore, unlike Driver Coordinators, there is no change in responsibilities of the position of Driver Trainer, or any lack of prior recognition of duties beyond those established for the role, that has been demonstrated on the evidence and the submissions.

Shed Driver

412   The applicant by its claim, in effect seeks the creation of a new classification of Shed Driver to cover those drivers who perform shed duties. The work, as is common ground, is confined to the Depot and involves marshalling and storing railcars in readiness for service.  On the evidence, I accept that as opposed to the work of a railcar driver, those performing shed duties are exposed to the extremes of weather and are required to walk significant distances in the course of a working day.

413   There is also evidence of the training role undertaken by shed drivers over the course of a Driver Trainee’s period of training, which runs to some three days or shifts.

414   I do note the evidence of Mr May that shed duties work is within the skill and competence of all railcar drivers. Those from this relatively small group of drivers, who perform shed duties at the Claisebrook Depot, are also required to drive in service from time to time, as the circumstances require it.  That is, they must stand ready to and be capable of driving in service when required.

415   In prior bargaining rounds, in particular in 2009, the respondent appears to have recognised the additional work of drivers engaged in shed duties and also in the most recent unsuccessful negotiations.

416   The Commission is not persuaded that there should be a new classification as claimed by the applicant.  Rather, there should be an allowance for shed driving duties which will fairly recognise this work.  The rate will be 5 per cent of the driver’s base rate on the commencement of the enterprise order, expressed to be paid on a per shift basis.  The rate will increase proportionately with the increases in the base rate over the life of the enterprise order.

Driver Trainees

417   In relation to this classification, I see no reason in principle, why the 85% relativity for Driver Trainees should not be restored, as is proposed by the respondent.  This is not opposed by the applicant.

The SERA

418   Under the 2004 enterprise order, the SERA was recognised by the Commission as having had several permutations, and it was ultimately incorporated into the base rate, and recognised as a broader customer service allowance.

419   As noted already, the status of the SERA was one of the contentious issues in the private arbitration before Smith SC in May 2008.

420   The Award as made in 2006, included the SERA but instead of being payable weekly, it was prescribed as a per shift payment.  The Commission in the private arbitration, accepted submissions from the respondent that this was an error and the intention was always to retain the SERA as a weekly payment as in the original consent variation to the 1973 award in 1991.  At the time of the 1991 award variation the SERA was set at a rate of approximately 6 per cent of the base rate for a driver. 

421   Regardless of the past, the issue is now to be resolved for the future.  Despite the history of the SERA, and that similar allowances are paid elsewhere in New South Wales and Victoria, at a similar rate, I consider there is much to be said for the approach of the respondent, that the SERA has, as a separate allowance, outlived its usefulness. There is nothing attached to the allowance that is not really comprehended in the ordinary duties of a Railcar Driver.

422   It is accepted it seems, that the requirement to make public announcements to passengers is a part of the job of a Railcar Driver.  This was confirmed with the Commission on the inspections, in discussions with drivers on the job.

423   As I have already mentioned, there is also no question that the respondent’s operations, in terms of on-time running and other indicators of performance, are well placed when looking at other Australian urban rail networks.

424   In my opinion, the SERA should be incorporated into the base rate.  This means it will also be payable whilst drivers are on leave.

425   The issue for determination is the rate of the SERA to be incorporated into the base wage.

426   The respondent contends that as forming part of the agreements reached in 2006, the applicant and the Railcar Driver Group should not now be able to depart from the prior agreed rate.  In my opinion, it must also be accepted that the base rate in the Award, incorporated the base rate in the 2006 Agreement, which in turn incorporated the SERA and thus, this was of benefit to the drivers. 

427   Additionally, the base rate incorporated into the Award, also included the then customer service allowance of $15.45 per week, which was rolled into the SERA flowing from the 2004 enterprise order. Separately, the rate of the SERA has been increased on three occasions since the making of the Award: (2008) 88 WAIG 2128; (2009) 89 WAIG 340; 2421.

428   Given the overall wage adjustments as arising from these proceedings, I do not consider there is any justification for any further increase in the SERA. The current rate is comparable to that applying in other States where such a payment is still made. 

429   I accept that as in Mr Appleby’s evidence, there needs to be some adjustment to reflect the incorporation of the allowance into the base rate which means the SERA will now flow through to leave and penalty rates. There was no challenge to the methodology suggested by Mr Appleby in his evidence.  Therefore, the rate of the incorporation of the SERA into the base rate will be $30.35. For the reasons identified also in Mr Appleby’s evidence, it will not apply to Driver Trainees.

Shift Work

430   The parties and the Railcar Driver Group propose different bases for dealing with shift allowances as set out above.

431   The applicant seeks a substantial departure from the usual approach that such allowances are paid on an “as worked” basis, to reflect the disabilities associated with working unsociable hours etc.  The respondent proposes that the rate increase be in line with rates payable across other groups within its operation. The respondent’s proposal incorporates consideration for an adjustment from the 2010 State Wage Case Order.

432   I consider that the respondent’s proposed rates for shift work are both fair and reasonable. The Commission sees merit in some consistency in the rates applicable to shift work, with other groups, as set out in the methodology proposed by Mr Appleby in his evidence.

433   That methodology takes the current Railways Employees Award REA 4 weekly base rate as at 1 November 2010, and adds the 24 months service experience allowance and leading hand allowances.  That total is then divided by 38 hours to give an hourly rate of $20.88 to which the National Rail Industry Award percentage of 13.23% for morning and afternoon shift is applied leading to a rate of $2.76 per hour.  The National Rail Industry percentage of 15.73% is applied to that hourly rate to lead to a rate of $3.28 per hour for evening shifts.

434   The Commission regards such an approach as providing adequate compensation for working shifts and is fair and reasonable.

Hours of Work

435   As noted earlier in these reasons, there is a substantial body of evidence before the Commission, in relation to hours of work.  From the respondent’s perspective, as in the evidence of Mr Appleby, issues associated with hours of work have been problematic in the past and have been conducive to disputation, in particular in relation to matters of interpretation of existing provisions.

436   I have considered the evidence and materials in relation to this issue carefully.  As already mentioned, I consider it is appropriate for a modern urban rail network to have the capacity to be flexible and to be adaptable to change.

437   It is to be noted that many provisions sought by the respondent seek to do little more than codify existing Award provisions and in others, such as the posting and the making of changes to the operational roster, seek to codify what in the past has been a matter of managerial prerogative. The Commission would expect that, as in the past, the respondent approach the issue of roster changes in a reasonable and responsible manner.

438   Having regard to the remuneration changes to be ordered, the Commission does not consider that the respondent’s proposals in relation to clauses 12 to 16 as a whole are unreasonable. This will include the capacity for the respondent to roster overtime.

439   However, there will be a qualification to this provision, such that the capacity to roster overtime will not be unlimited. It will be available in cases of Special Events, a concept well known, to reduce the “ripple effect”, and in other circumstances which are exceptional. The intent of this provision is that the rostering of overtime will not be regarded as a regular and ordinary event.

440   These proposed changes, and the flexibilities that they will afford the respondent in its operations, are also broadly in line with the working arrangements in other State urban rail systems.  The Commission sees no reason in principle why the respondent should not also have the benefit of such provisions.  The capacity to extend maximum shift lengths to nine hours for example, on the evidence of Mr Appleby, may avoid or substantially reduce the incidence of “make up pay” currently costing the respondent around $345,000 per annum.

441   Accordingly, I am not persuaded that the applicant’s proposed shift alteration allowance claim or the capacity, as advanced by the Railcar Driver Group, for a “roster change penalty”, should be granted.  I note, however, the respondent’s proposed overtime penalties are to be payable under clause 13.3 in the event that less than 48 hours notice of a change of roster is given.

Leave Provisions

442   There is considerable common ground in the position of the parties and the Railcar Driver Group as to leave provisions.  Clauses proposed by the respondent in relation to Cultural and/or Ceremonial Leave, Blood and Plasma Donors Leave, Witness and Jury Service Leave, Study Leave, Emergency Services Leave, Paid English Leave Training and Defence Force Reserve Leave are agreed.

443   There are some areas in relation to leave that are contentious.

444   As to sick leave, the applicant proposes that employees absent on account of sickness on a Sunday roster shift, be paid the appropriate penalty which is double time.  The applicant submitted that this is consistent with the result of a private arbitration before the Commission in 2008.  Additionally, the applicant contended that the respondent has paid this Sunday penalty since this time. The Railcar Driver Group seeks the continuation of the existing Award provisions.

445   The respondent seeks to remove all penalties from sick leave payments presently prescribed by the Award, and provide that only the base rate of pay be payable whilst an employee is on sick leave.  This is based on an analysis of sick leave patterns, suggesting a disproportionate taking of sick leave on Fridays, weekends and Mondays, as opposed to randomly during the week.  On the evidence of Mr Appleby, it seems that Saturday and Sunday shifts have the highest sick leave occurrence, where time and one half and double time penalties apply respectively.

446   The respondent also seeks to substantially change the provision for proof of absence on sick leave, following the large scale absences of Railcar Drivers in August and September 2010, leading to orders of the Commission at the time in other proceedings.

447   As to the issue of payment of penalties, I am not persuaded to grant the respondent’s proposal in this regard. The current situation is as a result of the existing Award provisions as supplemented by the private arbitration by the Commission in 2008. Whilst it is true to say as the respondent does, that such provisions are not common in the government sector in this State, any concerns as to the legitimacy of sick leave claims, for the future, can be dealt with by the respondent in terms of other changes the Commission proposes as follows.

448   As to the proof of illness/injury issue, in view of the experience of 2010, I consider that the respondent’s proposals are reasonable in all of the circumstances.  A capacity to require more detailed proof of illness or injury, in appropriate circumstances, would assist the respondent in managing its sick leave, in view of the concerns identified by Mr Appleby in his evidence.

449   The respondent’s proposed cl 43 in relation to earlier booking back on time is reasonable and fair and also will be included.

450   As to long service leave, the applicant proposes in its cl 16.4, to have drivers paid for periods of long service leave based upon their average earnings in the six months prior to taking leave.  This is claimed by the applicant as arising from bargaining outcomes in 2006, which was lost on the return of the drivers to the Award in 2008.

451   The respondent’s proposal in relation to this issue is consistent with conditions in other parts of its operations and the Commission is not persuaded to depart from it.

452   As to cashing out of leave, the respondent proposes in cl 29, as does the applicant and the Railcar Driver Group, for cashing out of leave entitlements. The respondent’s proposal in relation to annual leave is more limited having regard to the terms of the Minimum Conditions of Employment Act 1993. The respondent’s proposals provide for cashing out of credit days and leave in lieu of public holidays, in hours and not days. 

453   The respondent proposes the ability, consistent with the applicant’s position, to cash out credit days in advance with an ability to reconcile and recover from employees. This is fair and reasonable and will be included. The respondent estimates the savings of approximately $100,000 from such a provision.

454   Additionally, the Railcar Driver Group proposes an option to purchase annual leave, as was part of the 2006 Agreement.  This is opposed by the respondent.

455   Such a provision exists in other areas of the respondent’s operations, in Transwa, for transit officers, for railways employees, for trades employees and salaried officers. I see no good reason why the same benefit should not be extended to Railcar Drivers.  However, the clause will be limited to four weeks per annum as in the Transwa agreement, and it will be in the same terms.

Discipline

456   In relation to discipline, the applicant and respondent are apart as to the maximum fines that may be imposed in the event of a disciplinary offence being proved.  The Award, by cl 2.5.1, presently enables the Head of Branch to impose penalties for disciplinary offences, including a fine. The level of any fine imposed is unlimited.

457   The applicant, objecting in principle to the notion of fines being imposed in a contemporary workplace, contends that if any fine is imposed it should be limited to one days pay. The respondent contends that it should be two days pay as a maximum.

458   In my view the capacity to fine should not exceed one days pay.  This limit presently exists under the Transwa Agreement applicable to rail drivers, along with other areas of the respondent’s operations.

Other Provisions

459   Save for those matters dealt with above, other provisions of the respondent’s EO as set out in Part 1 - Arrangement (cls 1-7); Part 2 – Contract of Employment (cls 8-11); Part 4 – Rates of Pay (cls 19-22); Part 5 – Allowances and Facilities (cls 24-28); Part 6 – Leave (cls 3, 41, 31, 32, 34, 40, 38, and 39); Part 7 – Consultation; Part 8 – Disputes; Part 9 – Superannuation and Part 10 – Registered Organisation Matters I consider to be  fair and reasonable and will be included in the enterprise order to issue.

Corrections

460   After the conclusion of the hearing, the parties advised the Commission that some minor adjustments were required to the allowances for temporary transfer in cl 25.1(b)(i) and on call in cl 27.2.  Those have been incorporated into the order.

Operative Date

461   In relation to retrospectivity, in my opinion there is no power under the Act for the retrospective operation of an enterprise order. This is so even if I was of the view that a lump sum payment, as claimed by the Railcar Driver Group, should be included in the enterprise order.

462   To the extent that Smith SC in the 2004 enterprise order proceedings made an order for such a lump sum payment, with respect I disagree with that approach.  In my opinion, to make such an order would have the effect of circumventing the prohibition on the retrospective operation of such orders, and constitute an attempt to do indirectly, that which is prohibited by the scheme of the Act to be done directly.

463   The enterprise order to issue will operate from the first pay period on or after the date of the order.

Conclusion

464   The Commission makes an enterprise order in the terms of the minute now to issue.