Secure Employment Test Case (No 2) [2006] NSWIRComm 78

CATCHWORDS: State Decision - Conditions of employment - Award variation - Issues as to application of test case decision - Issues determined.

LEGISLATION CITED: Industrial Relations Act 1996

CASES CITED: Secure Employment Test Case [2006] NSWIRComm 38

HEARING DATES: 09/03/2006 EXTEMPORE JUDGMENT DATE: 03/09/2006

APPLICANT Mr A Hatcher of counsel and Mr C Christodoulou

RESPONDENTS Mr T McDonald LEGAL REPRESENTATIVES: Employers First and associated organisations

Mr D Grozier Australian Business Industrial and associated organisations

Ms R Docking The Australian Industry Group New South Wales Branch

FULL BENCH CORAM: Wright J, President Walton J, Vice-President Haylen J Tabbaa C 9 March 2006

SECURE EMPLOYMENT TEST CASE Application by Labor Council of New South Wales for variation of awards re secure employment clause

DECISION OF THE COMMISSION EX TEMPORE [2006] NSWIRComm 78

1 Pursuant to an application by Unions NSW under s 51 of the Industrial Relations Act 1996 for a test case standard in the form of a State decision, relating to security of employment, a decision of the Full Bench was delivered on 28 February 2006: Secure Employment Test Case [2006] NSWIRComm 38. 2 In accordance with that decision, Unions NSW filed draft orders on 3 March 2006 to reflect the following awards and orders made by the Commission: (1) Pursuant to s 51 of the Industrial Relations Act 1996, the Full Bench of the Industrial Relations Commission of New South Wales orders, for the purposes of awards and other matters under that Act, the making of a general principle, the terms of which shall be those proposed by Unions NSW in its application in relation to casual conversion and occupational health and safety, including those parts of the proposed "Secure Employment" clause as are necessary to give it proper meaning and effect, but shall exclude the provisions relating to labour hire, contracting out and rehabilitation. (2) Pursuant to s 17 of the Industrial Relations Act 1996, the Storemen and Packers Bond and Free Stores (State) Award and the Storemen and Packers Wholesale Drug Stores (State) Award shall be varied to incorporate the general principle contained in the model "Secure Employment" clause as proposed by Unions NSW and subject to the modifications specified in our decision. Other awards may be varied, upon application, to include the model "Secure Employment" clause. 3 Separate draft orders were filed to vary the Storemen and Packers General (State) Award (Exhibit A) (which the Vice-President confirmed, during the hearing of the matter on 8 March 2006, was the intention of the Full Bench in the Secure Employment Test Case decision), the Storemen and Packers Bond and Free Stores (State) Award (Exhibit B) and the Storemen and Packers Wholesale Drug Stores (State) Award (Exhibit C) ("the Awards"). The draft orders were all in identical terms save for necessary differences in numbering. 4 Employers First opposed the making of orders in the terms proposed by Unions NSW, on four grounds, which we shall now resolve so that the Awards made reflect our decision and orders. Qualifying period for casual conversion 5 Employers First sought to amend the draft orders to require a twelve month qualifying period before which a casual employee may elect to convert his or her employment to permanent full-time or part-time employment, in place of the six month period proposed by Unions NSW. 6 Employers First pointed to the apparent discrepancy between the clause proposed for the Storemen and Packers General (State) Award, which specified a six month qualifying period, and the provision in Union NSW's application for a test case standard whereby it sought the adoption of a model clause in other awards (by separate application) as follows: whether, in respect to those aspects of the clause which permit casual and labour hire employees to elect to convert to permanent employment after a period of 6 months, a different period (but not longer than 12 months) is appropriate having regard to the circumstances of the industry or occupation covered by the relevant award. 7 However, the Commission varied the Awards in terms of the actual application made for those awards (which in terms would form the model for other awards). 8 We confirm that the Awards were varied on the terms proposed by Unions NSW in its application for the Storemen and Packers General (State) Award, that is, on the basis of a six month qualifying period. 9 We also confirm our intention that the test case clause provides for conversion at six months unless in a particular award there is demonstrated to be exceptional circumstances to warrant a departure from that standard. Operative date for the purposes of casual conversion 10 Whilst the parties agreed that the date of operation was 1 March 2006, Employers First raised a question as to whether the operative date was the date on which the qualifying period commenced, or the date on which an eligible casual employee (that is, an employee who already has the requisite service) may elect to convert his or her employment to permanent full-time or part-time. 11 The latter interpretation is correct. That is, 1 March 2006 represents the date on which an eligible casual employee may give written notice of his or her election to convert his or her employment to full-time or part-time employment pursuant to sub-clause (b)(iii) of the Secure Employment clause proposed in the draft orders. This was the intention of the decision.

Consistency of casual conversion clause with part-time work provisions 12 Employers First contended that the draft orders did not adequately address the Commission's decision in relation to consistency with part-time work provisions, in particular, the following conclusion (at [248]): We conclude that the application by Unions NSW should succeed with the exception that consideration of conversion to part-time employment be preceded by casual employment consistent with the part-time provision of the relevant industrial instrument or be capable of expression in a part-time agreement pursuant to Part 5 of the Act. 13 It was suggested by Employers First that the meaning and intent of that passage is to create a requirement that before an employee may be eligible for casual conversion, the employee's casual employment during the qualifying period must satisfy the relevant statutory conditions for part-time employment. 14 Unions NSW submitted, correctly in our view, that the meaning and intent of that paragraph was merely to stipulate that, where an employee wishes to convert from casual to permanent part-time employment, such a conversion must conform with the part-time provisions of the award, or be in a form contemplated by Part 5 of the Act. That is, the casual conversion provision in the model clause does not impose a barrier to casual conversion by creating a pre-conversion requirement to meet the part-time employment provisions in an industrial instrument, nor does it create a new sub-class of part-time employment or in any way override or avoid the existing regulation of part-time employment. 15 In written submissions, Unions NSW advanced three further contentions:

(1) "the 'exception' referred to in paragraph 248 of the decision is to be read as ensuring that any conversion to part-time employment can be accommodated in a lawful way, either consistent with the part-time provisions of the relevant award (if any), or by being expressed in a part-time work agreement under Part 5 of Chapter 2 of the Industrial Relations Act . This reflects a recognition that conversion to part-time employment will not otherwise be practicable".

(2) The paragraph did not add an additional qualifying criteria beyond engagement on a "regular and systematic basis".

(3) The casual conversion clause proposed in Union NSW's applications is similar to that in the Federal Metals decision, whereas the interpretation advanced by Employers First essentially involves the adoption of the conversion clause in the South Australian Clerks award. If the Full Bench had intended to adopt that different provision, it would have done so. 16 We agree with Unions NSW's contentions. "Weekly" versus "permanent full-time" employment 17 Finally, Employers First raised a question as to whether the proposed award should refer to "weekly" employment rather than "permanent full-time", the former being the expression presently used in the Storemen and Packers General (State) Award. 18 The decision of the Full Bench in the Secure Employment Test Case refers to "permanent full-time employment", or more fully, the phrase "permanent full-time employment or part-time employment". We consider that phrase to be a clearer, and preferable, expression, and should be used in the clause notwithstanding the reference to weekly employment in the award. In any event, that was the intention of the decision. Orders 19 We confirm our orders and awards of 28 February 2006 and thereby vary the Awards as follows:

(1) The Storemen and Packers General (State) Award is varied in terms as set out in Exhibit A. (2) The Storemen and Packers Bond and Free Stores (State) Award is varied in terms as set out in Exhibit B. (3) The Storemen and Packers Wholesale Drug Stores (State) Award is varied in terms as set out in Exhibit C. (4) The variations shall take effect on and from 1 March 2006 with implementation of the variations being in accordance with paragraphs [10] and [11] of this decision.

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