Application under section 320 of the Industrial Relations Act 1996 to vary the Transport Industry – Quarried Materials, &c., Carriers Interim Contract Determination [2022] NSWIRComm 1094

Background to the application

1. The background to the applications and the nature of the controversy between the parties was summarised in written submissions filed by NSW Business Chamber Limited ("NSWBC") on 17 February 2022 ("NSWBC's Submissions"). Relevantly the NSWBC Submissions set out that: B. BACKGROUND 4. The Determination was made on 20 June 1991 and applies to contracts of carriage of quarried material and to all principal contractors (other than municipal, city and shire councils) and contract carriers engaged in or in connection with such work in the State of New South Wales (excluding the County of Yancowinna). 5. The Interim Determination was made on 4 October 2007 and applies to certain contracts of carriage falling within the Determination that are performed with particular 'high capacity' vehicles. Determination Rates 6. The Determination prescribes cartage rates for contract carriers. These are set out in Annexure A to the Determination (Rates). 7. Annexure B to the Determination contains a procedure for adjusting the Rates. Parties can apply to the Commission to adjust the Rates in accordance with a 'rise and fall formula (Formula). 8. The Formula takes into account increases or decreases in various benchmarks representing the following components of the Rates: (a) Labour; (b) Fuel; (c) Repair Parts; (d) Tyres/Accessories, (e) Registration; and (f) Other Fixed Costs. 9. The benchmarks used include modern award wages, various CPI subindexes and average fuel prices. 10. Each component is given a weighting, indicating the percentage contribution it makes towards the total Rate. 11. The increase or decrease to each benchmark is adjusted according to the relevant weighting, resulting in a percentage increase or decrease that is applied to the Rates. 12. Since the Determination was made in 1991, the Rates have been regularly amended in accordance with the Formula, usually on an annual basis. 13. As in the Determination, the Interim Determination prescribes cartage rates for contract carriers. These are set out in Schedule 1A and Schedule 1B of the Interim Determination (Interim Rates). 14. Unlike the Determination, the Interim Determination does not prescribe a method for reviewing the Interim Rates. 15. Despite this, the Interim Determination states that the Interim Rates were initially calculated as a fixed percentage (either 70% or 75%) of the Rates. 16. In 2019 when the Rates were last reviewed in accordance with the Determination's Formula, the Interim Rates were also increased by the same percentage.

Hearings in the application

1. The TWU application to vary the Main Determination came before the Commission, as currently constituted, on a number of occasions, namely: 1. 1 June 2022; 2. 30 June 2022; 3. 7 September 2022; and 4. 28 September 2022.
2. When the TWU made the application to vary the Interim Determination, it was initially allocated to Commissioner Sloan, but subsequently re-allocated to the Commission as currently constituted so that it could be dealt with concurrently with the TWU application to vary the Main Determination.
3. At the hearing of both applications on 28 September 2022, the following parties were represented in the application to vary the Interim Determination: 1. TWU; 2. NSWBC; and 3. Boral Transport Limited.
4. The parties represented reported on several occasions that they have been in ongoing discussions with a view to resolving the areas of disagreement between them, albeit largely about the Main Determination. The NSWBC Submissions set out that: 19. Following the TWU filing its original application [to vary the Main Determination], the various parties have conferred with a view to agree on appropriate variations to the Determination and Interim Determination both to amend the [rates in each] and to compensate contract carriers for the sudden and unusual increase in the price of fuel.
5. From an examination of the file held by the Industrial Registry, I am satisfied that Australian Federation of Employers and Industries were notified of this matter and its listing. They were, as set out in a separate Decision in Application under section 320 of the Industrial Relations Act 1996 to vary the Transport Industry - Quarried Materials, &c., Carriers Contract Determination [2022] NSWIRCOMM1093, aware of the application to vary the Main Determination through its listing before the Commission as set out in [7] above.
6. As the parties submitted on 28 September 2022, attempts to contact Extractive Industries, New South Wales ("EI NSW"), or to even ascertain if it continued to exist, were entirely unsuccessful. As EI NSW have been a listed party to the Interim Determination for some years, I consider it nevertheless appropriate to continue to decide the application to vary the Interim Determination despite their absence.
7. I granted leave to EI NSW to remove itself from respondency to the Interim Determination, or to vary the application of the variation should it choose as further means to provide fairness to EI NSW. I have asked the Industrial Registrar to investigate whether EI NSW can be contacted, and indeed whether the Commission should of its own motion move to strike EI NSW from respondency to the Interim Determination.

Principles to apply in determining application

1. On the issue of the principles to be applied, the NSWBC Submission was that: 21. In Application for Variations to Transport Industry General Carriers Contract Determination 2017 [1] (GCCD Decision), Commissioner Sloan varied the Transport Industry - General Carriers Contract Determination 2017 (GCCD) to introduce a temporary fuel surcharge. 22. In the GCCD Decision, Commissioner Sloan referred to his prior decision in Applications to Vary the Transport Industry - General Carriers Contract Determination 2017 and Transport Industry Courier and Taxi Truck Contract Determination [2] in which he set out the principles that the Commission should apply when dealing with applications such as the one before him. 23. These principles adopted the view of Commissioner Newall in Transport Industry General Carriers Contract Determination 2017 [3] , when he observed that: like an award, a contract determination ought to set fair and reasonable rates. The overarching duty of the Commission when it is dealing with the setting of rates and conditions is that it must make rates and conditions which are fair and reasonable; and the consent of the parties to an application to make or vary a contract determination is important and relevant but is not of itself determinative.
2. I have had regard to the decision of Commissioner Sloan in Applications to Vary the Transport Industry - General Carriers Contract Determination 2017 and Transport Industry Courier and Taxi Truck Contract Determination at [7 to 12] and adopt those principles.
3. As the NSWBC Submission set out, in summary the overarching duty of the Commission is to set rates and conditions which are fair and reasonable. The consent of the parties is important and relevant, but not determinative.

Submissions

1. The NSWBC Submissions on the merits of the application were: Rates 24. The proposed variations include the introduction of amended Rates (and consequential amendments to the benchmark index figures and weighting). 25. The amended Rates are calculated correctly. 26. The amended Rates have been calculated in accordance with methodology that: (a) forms part of the Determination, having already been approved by the Commission; and (b) has historically been used to review the Rates on a regular basis. … Consent Position 33. Following consultation with all interested parties the matter is moved by consent or otherwise not opposed and this was communicated the Commission on 1 August 2022. Operative Date 34. Due to its monthly nature, the proposed operative date for the Levy is 1 October 2022. 35. It is appropriate for the amended Rates and Interim, Rates to take effect on the same date because having a single operative date would reduce the administrative burden on both principal contract and carriers.
2. Mr Rasmussen for the TWU supported these submissions.
3. I am satisfied by the submissions of parties that the amended rates set out in the proposed new table attached to the NSWBC Submission are fair and reasonable. Largely this satisfaction is based on the amended rates being calculated using the basis used to originally set rates in the Determination, and the proposed changes to the Interim Determination restoring relatives to the Main Determination.
4. I find reinforcement that the rates are fair and reasonable from the process whereby the applicant and respondents engaged in lengthy discussions over the rates, and then either directly supported the amendments, or were given appropriate opportunity to make representations to the Commission and did not make any submissions.
5. I note that the volatility of the price of fuel, which is one of the reasons for seeking a fuel levy in the Main Determination, remain. Accordingly, the parties submitted that the fuel levy as sought will not fully resolve the issues between the parties on even a medium term basis. That is, the variations do not fully resolve the issues between the parties.
6. Accordingly, the orders made on 28 September 2022 should not be taken as fully resolving the issues between the parties, and the matter will remain open should the parties wish to make further applications to amend the Interim Determination. C Muir Commissioner

Endnotes

1. [2022] NSWIRComm 1029
2. [2022] NSWIRComm 1003
3. [2017] NSWIRComm 1013 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 28 October 2022