PN1741

JUSTICE ROSS: Can I just go over some of the documentation that either we've sent to the parties or that has been filed, just to make sure everyone has the same set of material and in case I've missed anything. The material we have sent there was - and I might deal with that in a little more detail in a moment - there was a document which deals with the relevant principles applicable to the review. There is a document which seeks to summarise the correspondence from the SDA and RAFFWU about the findings issue, which ones were contested and which ones were not. Can I just - I'm sorry, I should have checked, there's a change of appearances for RAFFWU?

PN1742

MS S KELLY: Yes, good morning. My name is Kelly, initial S. I appear for the Retail and Fast Food Workers Union and with me I have - - -

PN1743

JUSTICE ROSS: Just bear with us for a moment, Ms Kelly, we're just having a bit of trouble hearing you.

PN1744

MS KELLY: Yes, your Honour.

PN1745

THE ASSOCIATE: Ms Kelly, yes, if you could just move the microphone closer?

PN1746

JUSTICE ROSS: If it's easier, just remain seated. Would you mind just speaking for a moment?

PN1747

MS KELLY: Yes. No, certainly, your Honour. I've moved the microphone closer. Is that better?

PN1748

JUSTICE ROSS: That is better. Thank you.

PN1749

MS KELLY: Thank you, your Honour.

PN1750

JUSTICE ROSS: Can I take the parties to firstly the review document. We indicated we would seek to ascertain the view of the parties to it, whether they had any corrections or amendments, whether they took issue with any part of it, at the start of the proceedings. So let's do that.

PN1751

Yes, Mr Gotting?

PN1752

MR GOTTING: Your Honour, can I just say at the outset I don't see my role as marking the homework of the Commission, but may I respectfully raise one issue?

PN1753

JUSTICE ROSS: Certainly.

PN1754

MR GOTTING: Concerning the summary. It relates to paragraph 2 of the summary and it in the first sentence deals with:

PN1755

The general discretion confined only by the scope and purposes of the legislation will ordinarily be implied.

PN1756

JUSTICE ROSS: Yes.

PN1757

MR GOTTING: The one matter that we wanted to draw the Commission's attention to is that the usual way in which that principle is stated is by reference to the subject matter, scope and purpose in the Act.

PN1758

JUSTICE ROSS: Yes, yes.

PN1759

MR GOTTING: And I don't know if it was intentional or otherwise.

PN1760

JUSTICE ROSS: No, no.

PN1761

MR GOTTING: But the word "subject matter" seems to have fallen out.

PN1762

JUSTICE ROSS: Yes. No, no, I - - -

PN1763

MR GOTTING: In fairness, at the end of paragraph 9 in the summary there's a reference to the Peko Wallsend.

PN1764

JUSTICE ROSS: Which does include the expression, yes. No, I follow.

PN1765

MR GOTTING: It does, but subject to that, that's the only comment that we wish to raise.

PN1766

JUSTICE ROSS: All right. Thank you.

PN1767

MR BRUNO: Absolutely no comments from the SDA about that summary, your Honour.

PN1768

JUSTICE ROSS: All right. Thank you. Ms Kelly?

PN1769

MS KELLY: Your Honour, no contents(sic) about the content of the summary as it stands. The one point we do make is that we will have something to say about the nature of the evidence that is required in order for the Commission to reach the required state of satisfaction.

PN1770

JUSTICE ROSS: Yes. Yes.

PN1771

MS KELLY: And we'll deal with that in our substantive oral submissions.

PN1772

JUSTICE ROSS: Yes, okay.

PN1773

MS KELLY: Thank you, your Honour.

PN1774

JUSTICE ROSS: Can I touch on the findings document. Can I ask firstly whether - it may not set out all of the extent of the comment or the reasons why it's contested and I'll come back to that in a moment, but is that document accurate insofar as it seeks to record the findings which are not opposed and those which are contested by either of the SDA or RAFFWU? The SDA?

PN1775

MR BRUNO: Yes, it is, your Honour. I can see that there were two findings referred to in a letter that came or which was sent to the Commission from my instructor that referred to some comments or some submissions I was going to make in relation to paragraphs 15 and 17. But having a look at the findings which are not opposed, that is correct but I'll still have a submission to make about paragraph 15, and I can see that the Commission has a place for that in the other section of the document in any event.

PN1776

JUSTICE ROSS: Yes. Yes.

PN1777

Ms Kelly?

PN1778

MS KELLY: Yes, it's accurate from RAFFWU's perspective, your Honour.

PN1779

JUSTICE ROSS: Okay. Can I ask each of you what is the most convenient way of dealing with the findings that are contested? And what I mean by that is this, do we deal with it now and you argue why or during the course of your oral submissions do you intend to go to the findings that you're contesting and elaborate then? Which is the more convenient course for you?

PN1780

MR BRUNO: If I could address the Commission first in relation to that issue. Either is convenient for me. The only matter that might arise if I start addressing them without the benefit of submissions is that with respect to some of the findings I address I'll actually delve into the submissions and I - - -

PN1781

JUSTICE ROSS: No, I follow.

PN1782

MR BRUNO: And the Commission then might hear me say that again later and so it might be more - - -

PN1783

JUSTICE ROSS: I want to avoid that, Mr Bruno.

PN1784

MR BRUNO: Yes, I imagine so. So it might be convenient for me to address them separately. I don't think the findings that I'll address, which are I think five or six paragraphs altogether, will take too much of the Commission's time in any event.

PN1785

JUSTICE ROSS: Okay.

PN1786

Ms Kelly, do you have a preference?

PN1787

MS KELLY: To deal with them in oral submissions, your Honour for the same reasons. It would I think require some repetition if we were to address them now and then canvass them again.

PN1788

JUSTICE ROSS: No, that's fine.

PN1789

MS KELLY: And I will of course add tentatively, your Honour, that you may have seen that my client will be renewing its application to make written submissions.

PN1790

JUSTICE ROSS: Yes, I will come to that in a moment.

PN1791

MS KELLY: And so we may wish to deal with them in that context as well.

PN1792

JUSTICE ROSS: Okay.

PN1793

MS KELLY: Thank you, your Honour.

PN1794

JUSTICE ROSS: We'll just allow you to deal with them in the - we'd just ask you to make sure you address each of the findings that you contest and explain the basis for the objection. It's identified in a number of instances in RAFFWU's document but in the SDA's it's more of a simple proposition.

PN1795

MR BRUNO: Yes, I realised that. It probably would have been more helpful if I set some detail out.

PN1796

JUSTICE ROSS: No, no, that's fine. We only asked you to identify which ones you contested.

PN1797

MR BRUNO: Yes, your Honour.

PN1798

JUSTICE ROSS: And you've both done that.

PN1799

We have received - so in terms of the material from the parties we have received the letter from the SDA's solicitors, as you have identified, and RAFFWU's submission both directed at the findings. We've received two documents from Ai Group. The first was a response to queries that the Commission made. I have taken this to be a response to the questions put to a witness at paragraphs 1101 to 1135.

PN1800

The response document though doesn't deal with a question I asked the witness which was seeking information about the numbers of full‑time, part‑time and casual employees employed in McDonald's restaurants both corporate and franchisees as at 1 June 2013. The question is at paragraph 1110 to paragraph 1111. To the extent it's inelegantly phrased there I'll replace it with what I've just put. And do you have an indication as to when that information will be provided?

PN1801

MR DIXON: There has obviously been an oversight in that regard and we will endeavour to do that as a matter of urgency, your Honour.

PN1802

JUSTICE ROSS: Do you want a moment to - are you able to find out how long that - it may affect - I mean other parties might want to comment, except do you want a moment, Mr Dixon? We can stand it down for five minutes if you like. Would that assist or not?

PN1803

MR DIXON: I think it may assist. Perhaps your Honour might just deal with the other matters and then we can - - -

PN1804

JUSTICE ROSS: Certainly, you can do something about it and we'll - - -

PN1805

MR DIXON: We could do something about it.

PN1806

JUSTICE ROSS: Yes. No, that's fine.

PN1807

The other document was an Ai Group supplementary outline of submissions which deals primarily with RAFFWU's cross‑examination. It's a document of some 10 pages. It was filed at 4.50 pm yesterday. In response - well, there is correspondence from Mr Cullinan of RAFFWU indicating that they propose to renew their application for the filing of written closing submissions. So let me ask firstly are there any other documents I've missed that anyone has filed? No?

PN1808

MR BRUNO: No, your Honour.

PN1809

JUSTICE ROSS: No, all right.

PN1810

Let me go to you, Ms Kelly, and the application that's foreshadowed and what are you seeking?

PN1811

MS KELLY: Thank you, your Honour. We renew the application to file written submissions made by Mr Cullinan at the last directions hearing and we do that on two bases. First, from my peruse of the transcript it was left open to Mr Cullinan to renew the application in any event, and we do so, and then we have something to say about the supplementary submissions filed without leave or order at 4.50 yesterday afternoon. Dealing with the first, the general issue of why we say that my client ought to have an opportunity to file written submissions, we say the following.

PN1812

First, this is a matter that my client takes very seriously. From its perspective the changes sought represent a seismic shift in the protections afforded to part‑time employees under the award and traditionally in this industry. In circumstances where it is a matter of significant seriousness my client believes that it can best put the case it wishes to put by being afforded the opportunity to put its submissions in writing. Second, there has been a limited period of time between Monday's hearing and today in which to prepare a detailed response to the evidence and the significant cross‑examination that has taken place.

PN1813

Third, these issues are complex. One of the submissions that will be put on behalf of my client is that there is an insufficient evidentiary basis upon which the Commission could form the necessary state of satisfaction required under section 134 of the Act. That is a serious submission and requires a detailed analysis of the evidence that has been filed and also the cross‑examination. It is a task that is best done in writing given the necessity to refer frequently to matters dealt with in cross‑examination.

PN1814

Fourth, as may well have been apparent, Mr Cullinan was ill on Monday and has since spent some of the intervening time driving back to Melbourne from Sydney and counsel, that is myself, has been unavailable for the past 12 days due to an unforeseen and urgent family commitment that called me to London.

PN1815

Fifth, as we understand it nobody else has made an application to file written submissions and so the concern that I understand the Commission expressed, which is that there has been a cascading effect that submission upon submission upon submission is filed, can be dealt with by confining the submissions that my client will file and any submissions in response, although we note that no one has indicated that they would wish to make them. They are the substantive reasons why my client's application is renewed.

PN1816

JUSTICE ROSS: Can I just ask you when you say you could confine the submissions, in what way?

PN1817

MS KELLY: In a number of ways, your Honour. I understood there was a concern put that permitting written submissions can become unending as parties continually respond, and so we have an echo chamber of submissions. The submissions could be confined by the time that we are given to prepare and file them. They could be confined by the number of pages that they are to occupy, and there could be a confined timetable if any reply submissions are sought. We would only seek the one opportunity to put our client's case.

PN1818

Now the additional matter I then wish to come to is the Australian Industry Group filing at 4.50 pm yesterday 10 pages of densely referenced supplementary submissions in reply. Two things need to be said, or three things need to be said. One, no order was made for those submissions to be filed and in fact no order was made for the reply submissions filed by the AiG. Two, as I've indicated they are densely referenced submissions that we have reviewed at a very superficial level in the time available to us. They are submissions of the kind that my client wished to file with transcript references and evidentiary references throughout them.

PN1819

Third, they were filed in circumstances where the AiG representatives were present in the Commission when my client was informed that it would not be permitted to file written submissions and there is an inherent unfairness in that circumstance in the Commission receiving the written submissions of the AiG. We don't ask the Commission not receive them. Substantial effort has clearly been put into the preparation of those submissions but it adds to what we say is the requirement of fairness that my client be afforded the opportunity to prepare its own written submissions.

PN1820

And finally I note, your Honour, that the AiG has substantial resources available to it whereas my client is relying on the pro bono assistance of counsel. In all of those circumstances we say that written submissions should be permitted and that appropriate orders can be made both as to the time permitted, the length of the submissions and any reply, to address the concerns raised by the Commission at the last directions hearing about the time that might be injected into the process.

PN1821

JUSTICE ROSS: Thank you, Ms Kelly.

PN1822

MS KELLY: They're the submissions for the union. Thank you.

PN1823

JUSTICE ROSS: Mr Dixon?

PN1824

MR DIXON: May it please the Commission. It's obvious from AiG's perspective that there's a desire for this matter to be concluded in an expeditious way and the matters that - - -

PN1825

MS KELLY: May it please the Commission, I apologise for interrupting but I can't hear my learned friend.

PN1826

MR DIXON: Is that any better, Ms Kelly?

PN1827

MS KELLY: It certainly is. Thank you.

PN1828

MR DIXON: Thank you.

PN1829

Your Honour, there are a number of factual issues that need to be addressed in relation to this matter. The first is that the evidence that has been filed in support of the application was filed in February and there has been a considerable period of time available to analyse that material and to have it available in a written form today if that was desired. The evidence in relation to cross‑examination was the first cross‑examination occurred some weeks ago in relation to Mr Flemington.

PN1830

The other cross‑examination occurred on Monday of this week. The idea that there was limited time available, it has been demonstrated that if energy was put into this matter, that material could be analysed. It's not the analysis that has been carried out and the findings that have been made could have been - there is no reason to suggest that this organisation could not have been in a position to deal with those matters today in any way that prejudiced them if the energy had been put into the matter.

PN1831

JUSTICE ROSS: So I take it from that you oppose the - - -

PN1832

MR DIXON: We oppose it the application and we oppose it on the basis that what we have sought to do of course is to try and make the proceedings more efficient, and we have done so with a view to trying to assist the Commission and may I just go back one step. The Commission asked the parties to direct what findings needed to be made and those findings have been based on primarily the evidence that was in existence, filed in February of this year, and there's nothing to suggest that the opposing organisation that is seeking to intervene in what is essentially a consent application in one sense - I understand - well, the - - -

PN1833

JUSTICE ROSS: But it's not in the resolution of an industrial dispute. Whether there's consent or not, we still have to be satisfied.

PN1834

MR DIXON: Yes, I'm not suggesting otherwise, your Honour, but I'm suggesting it in the context of there is support from the major organisation representing a vast number of employees in this industry. So in our respectful submission the reasons that have been put forward by the intervening party do not justify an adjournment and it is clear that if there is any written submission filed after today then there has got to be an opportunity to respond, and the matter will then just continue.

PN1835

In my respectful submission the issues have been laid out for a long time, the evidence has been there, the analysis of cross‑examination, there has been ample time to deal with the matter and any deficiencies that could be identified can be orally identified and there is no reason why these proceedings should be progressed to a later stage.

PN1836

JUSTICE ROSS: Thank you, Mr Dixon.

PN1837

Is there anything you want to say, Mr Bruno?

PN1838

MR BRUNO: Yes, on behalf of the SDA the application for written submissions isn't opposed. I didn't understand my friend, Ms Kelly, to be suggesting that there would be an adjournment of today's proceeding. I understand that the hearing would still go ahead, it's just that some more time would be sought for some brief written submissions. If the Commission were minded to grant that application then it would be appropriate in those circumstances for orders to be made for all parties. I assume that that's what the Commission might foreshadow.

PN1839

JUSTICE ROSS: I think we'll deal with it one step at a time.

PN1840

MR BRUNO: Yes.

PN1841

JUSTICE ROSS: But, yes.

PN1842

MR BRUNO: Thank you, your Honour.

PN1843

JUSTICE ROSS: Just bear with us for a moment.

PN1844

We propose to grant the application. In doing so we, touching on the issue raised by Mr Bruno, provide Ai Group with the option of either proceeding with its oral submissions today or by reducing them to writing at a later date. Similarly with the SDA. In the event that Ai Group wishes to put its oral submissions today then the SDA would be able to elect to either respond orally today - I am thinking here of the convenience of costs for the parties - and you can best make a judgment as to which course is in your client's interests.

PN1845

To give you an example, if you were to put your oral argument today we would then require RAFFWU and, if it sought it, the SDA to file their written submissions in reply by 4 pm next Thursday, so seven days, and then we would provide Ai Group with an opportunity to respond in writing. The timeframe of that we would want to hear from you about. So the first issue for you is whether you wish to put your argument now orally or whether you wish to commit it to writing.

PN1846

What we propose to do is stand the matter down for 10 minutes. That also will provide an opportunity for you to find out when we might get the information that we had sought, and when we return you can advise us as to which course you wish to adopt and how much time after the filing of RAFFWU's written submissions in reply you will require to file your written responses to them.

PN1847

MR DIXON: May it please the Commission. May I just clarify one matter, if your Honour pleases?

PN1848

JUSTICE ROSS: Certainly.

PN1849

MR DIXON: If we were to put AiG's submissions today orally do we take it that the other parties or other representatives not being parties.

PN1850

JUSTICE ROSS: Yes.

PN1851

MR DIXON: Would have to put their submissions today orally and then - - -

PN1852

JUSTICE ROSS: No.

PN1853

MR DIXON: - - - add to it at a later stage in writing?

PN1854

JUSTICE ROSS: No. They wouldn't need to put their responses orally today.

PN1855

MR DIXON: If your Honour pleases.

PN1856

JUSTICE ROSS: Yes, it's really that given you're here it's a matter for you to work out what you're doing. What we've made clear is that RAFFWU need not put their submissions orally today and we would give them seven days to file it. With the SDA, they may want to - but that would be a matter for them - to elect really to put their - is there only - well, you know, I don't want to understate it but they're putting - - -

PN1857

MR DIXON: They're narrower, yes.

PN1858

JUSTICE ROSS: Their submissions are directed to one aspect of the application.

PN1859

MR DIXON: I understand. If the Commission pleases.

PN1860

JUSTICE ROSS: Yes, all right. We'll stand down for - yes, Mr Gotting?

PN1861

MR GOTTING: Sorry.

PN1862

JUSTICE ROSS: No, that's fine.

PN1863

MR GOTTING: Can I just seek to clarify the nature of the request that was made on the last occasion?

PN1864

JUSTICE ROSS: Certainly.

PN1865

MR GOTTING: About the comparative data.

PN1866

JUSTICE ROSS: Bear with me.

PN1867

MR GOTTING: The transcript records that the data - - -

PN1868

JUSTICE ROSS: Just bear with me for a moment.

PN1869

MR GOTTING: I'm sorry.

PN1870

JUSTICE ROSS: I'm just turning it up. Yes, this is at paragraph 1111? I'm interested in the comparative data to that which is set out at paragraphs 23 and 24 as at 1 June 2013.

PN1871

MR GOTTING: Yes, I just wanted to clarify 2013 not 2018?

PN1872

JUSTICE ROSS: No, that's right, it's 2013. Yes.

PN1873

MR GOTTING: Yes. Your Honour, I can indicate that McDonald's is not able to obtain the data requested as at that date, 1 June 2013, but it is able to provide data based on 17 June 2013.

PN1874

JUSTICE ROSS: When did the agreement come into operation?

PN1875

MR GOTTING: I just need to check that but it was prepared - - -

PN1876

JUSTICE ROSS: I want information that relates to the pre‑agreement. I'm probably also going to be seeking in affidavit form why they can't provide it when they're obliged to retain records for seven years.

PN1877

MR GOTTING: I just think it's in the form that's being sought, the comparative form. I'm not seeking to suggest that the appropriate pay records and the like have not been retained.

PN1878

JUSTICE ROSS: No, no. Well, perhaps - - -

PN1879

MR GOTTING: That's obviously a separate matter but - - -

PN1880

JUSTICE ROSS: Yes, yes, perhaps a comparative form is not - really, leave aside the comparison question for a moment. It's really I just want to know how many full‑time, part‑time and casual employees were employed in McDonald's restaurants as at 1 June 2013.

PN1881

MR GOTTING: I've got the numbers as at 17 June 2013 but I'm sorry, I'm - - -

PN1882

JUSTICE ROSS: I don't quite - - -

PN1883

MR GOTTING: I'm told that a report was prepared perhaps as part of the process for the approval of the enterprise agreement, because I think it was included as part of the form F17.

PN1884

JUSTICE ROSS: Okay, well I think the agreement commenced no earlier than 23 June so that information that you're referring to should satisfy the request.

PN1885

MR GOTTING: Can I - - -

PN1886

JUSTICE ROSS: But you might want to check that point.

PN1887

MR GOTTING: - - - answer a question that the total numbers in terms of corporate stores and franchise stores as at 17 June 2013 was 89, 704.

PN1888

JUSTICE ROSS: Yes.

PN1889

MR GOTTING: In terms of full‑time employees as at that date, 9,127. In terms of part‑time employees at that date, 7,639 and in terms of casuals at that date, 72,938.

PN1890

JUSTICE ROSS: Okay, I think that - - -

PN1891

MR GOTTING: Does that respond to your Honour's question?

PN1892

JUSTICE ROSS: I think it does. No, no, I'm sure it does. Thanks Mr Gotting.

PN1893

So 10 minutes to consider the position.

PN1894

MS KELLY: Excuse me, your Honour, can I just raise one matter? There's some concern that if the AiG don't put their submissions today and they depart in any material respect from what has been put in writing it effectively means that the responsive parties are going first with written submissions, and they may in fact not deal with matters that are raised by the AiG. So I think it's almost necessary that the AiG - - -

PN1895

JUSTICE ROSS: I'm not - just - - -

PN1896

MS KELLY: - - - puts its submissions first.

PN1897

JUSTICE ROSS: No, no, just let me go back a moment.

PN1898

MS KELLY: Yes, your Honour.

PN1899

JUSTICE ROSS: AiG will put its submissions first either orally or in writing.

PN1900

MS KELLY: I see. My apologies, your Honour.

PN1901

JUSTICE ROSS: No, no, no, I probably wasn't clear about that. But what I'm providing is Ai Group with the option as to which course it wishes to pursue.

PN1902

MS KELLY: Certainly.

PN1903

JUSTICE ROSS: It would put in submissions, then there would be a period of time that we'll discuss when we get back. If Ai Group wishes to put written submissions then on the resumption they can advise as to how long they require and then we'll deal with the sequential directions from there. No, it wasn't intended that you would go first as it were.

PN1904

MS KELLY: I'm grateful for the clarification. My apologies for the misunderstanding.

PN1905

JUSTICE ROSS: All right, we'll adjourn. Thank you.

SHORT ADJOURNMENT [10.12 AM]

RESUMED [10.25 AM]

PN1906

JUSTICE ROSS: Yes, Mr Dixon?

PN1907

MR DIXON: May it please the Commission. Ai Group would seek to utilise the opportunity of putting its submissions orally in addition to its written submissions this morning, if that's convenient to the Commission?

PN1908

JUSTICE ROSS: Certainly, yes, and once you've completed, Mr Bruno you can indicate what you want to do.

PN1909

MR BRUNO: Yes, your Honour.

PN1910

JUSTICE ROSS: Let's assume then that RAFFWU and to the extent that the SDA seeks to put a written submission rather than orally today, that they would file that material by 4 pm next Thursday. How long does Ai Group seek to reply to that material?

PN1911

MR DIXON: Seven days, if the Commission pleases.

PN1912

JUSTICE ROSS: All right. So 4 pm the following Thursday?

PN1913

MR DIXON: If the Commission pleases.

PN1914

JUSTICE ROSS: All right, so just to be clear. RAFFWU - and we'll find out the SDA's position shortly, well, in due course - will file its written submission in reply by 4 pm Thursday 26 July. The Ai Group will file its written submission in response to RAFFWU's written submission by 4 pm on Tuesday 2 August - sorry, Thursday 2 August at 4 pm and with liberty to apply.

PN1915

Yes Mr Dixon?

PN1916

MR DIXON: If the Commission pleases. May I start by just reminding the Commission if I may respectfully do so in relation to some of the specific legislative provisions which we would rely upon in support of the application. The Commission is clearly familiar with section 156 and the basis of the review. I'm not going to address that. But may I start by asking the Commission to go to the Fair Work Act and we want to emphasise the significant emphasis in the Act in various places on the need for flexibility, and one starts with section 3, the object of the Act. And the Commission will see in subsection 3(a) that the object of the Act is to provide a balanced framework et cetera by various things including (a):

PN1917

providing workplace relations laws that are fair to working Australians, are flexible for businesses, promote productivity

PN1918

Subsection (b) talks about "fair" and "relevant". Subsection 3(d) talks about or specifies:

PN1919

assisting employees to balance their work and family responsibilities by providing for flexible working

PN1920

Arrangements

PN1921

And then when one comes to section 134, 134 also has emphasis on flexibility. 134(1)(d) requires the Commission in the modern award objective to take into account:

PN1922

the need to promote flexible modern work practices and the efficient and productive performance of work

PN1923

One finds similar provisions or emphasis in section 138. Of course that's the obligation to achieve the modern award objective but section 139, a term that may be included in a modern award, one sees in 139(1)(b):

PN1924

type of employment, such as full-time -

PN1925

et cetera:

PN1926

and the facilitation of flexible working arrangements

PN1927

In (1)(c):

PN1928

arrangements for when work is performed, including hours of work, rostering, notice periods, rest breaks and variations to working hours

PN1929

One finds similar emphasis in section 144. 144 which deals with flexible terms in subsection (4):

PN1930

The flexibility term must ... identify the terms -

PN1931

et cetera. Subparagraph (b):

PN1932

Require that the employee and the employer genuinely agree to any individual flexibility arrangements

PN1933

And section 156 also deals with the question of the flexibility in the four year review.

PN1934

The Commission would be aware from the material that is filed that the relevant provisions of the Fast Food Award which are the subject of this application are clause 12, which is the provision which concerns - supported as we understand it by the SDA, and then there are changes required for the first point to the ordinary hours of work provision in clause 25(5), this is the evening work Monday to Friday, and clause 26, which is the rate of overtime because the rate of overtime will be affected if the Commission grants the proposed flexibility clause replacing clause 12.2 of the existing agreement.

PN1935

The proposed determination is a schedule to the submissions of 12 July 2018 and the Commission will see, that is to hand, that the first variation to the Fast Food Award is that set out in our paragraph A2, deleting existing clause 12 and inserting a new clause 12. I'm obviously going to come back and deal with that provision in some detail. That change is supported by the SDA. The A3, which is the variation to clause 25 of the modern award which introduces a different form of flexibility agreement, is set out in paragraph A3 and then there are the consequential clause 25 and 26 in relation to how overtime is to be calculated in the event that the changes are made earlier.

PN1936

I will be returning to address all of those in some detail in a moment. The organisation for which Ms Kelly appears, as I understand it, does not take issue with the proposed variation in A3, the night penalty, and no submissions or questions have been asked in relation to that matter.

PN1937

JUSTICE ROSS: I thought RAFFWU had opposed both claims.

PN1938

MR DIXON: That's not in their written submissions, your Honour.

PN1939

JUSTICE ROSS: No, but I thought they had opposed both claims. I thought that was their position earlier. Am I wrong about that, or?

PN1940

MR BRUNO: I thought there - I've read, I think, a mention hearing before the Commission where it was indicated that RAFFWU's interest was in relation to the part time flexibility, so I'm not aware that they've opposed both but ‑ ‑ ‑

PN1941

JUSTICE ROSS: Might be worthwhile clarifying that. Ms Kelly, can you - - -

PN1942

MS KELLY: Your Honour is correct, they are both opposed but on that question, my client has left it to the SDA to agitate the point.

PN1943

JUSTICE ROSS: I see, yes, all right.

PN1944

MS KELLY: Thank you.

PN1945

JUSTICE ROSS: The submissions that are put against you in relation to the flexibility term are those put by the SDA but RAFFWU opposes it but advances no submissions, yes.

PN1946

MR DIXON: And no evidence and no cross-examination went to that issue, thank you. In relation to the proposed findings, we have obviously set out the proposed findings in each respect. I don't intend to address those, if the Commission pleases, unless there's a particular matter today because we haven't heard from the other side about what they are. May I just say this, we would invite the Commission to make those proposed findings.

PN1947

In our respectful submission, they are, in each case, supported by evidence. The evidentiary basis for each of the findings is set out in the proposed findings and the Commission clearly is also able to, by inference, make the findings, the inference being supported by, and drawn from the primary evidence which is there put. May we also highlight some parts of the evidence relied upon by Australian Industry Group underpinning and supporting those findings and in this regard, I would ask the Commission to look at the evidence that is filed and starting off with the statement of Ms Anderson, which is exhibit AI GROUP3.

PN1948

JUSTICE ROSS: Just bear with me for a moment. Yes, Mr Dixon.

PN1949

MR DIXON: There are only a few paragraphs which we want to highlight from her evidence, if the Commission pleases, and the first is paragraph 25 of exhibit AI GROUP3 and in that paragraph, she deposed to McDonald's employees employed within the spread of full time, part time and casual categories and in paragraph 25(a) there's reference to the peak trading periods which vary significantly, and in (b) she said that the costs of employing employees varies depending on any employment status and, for example, part time and full time employees are more cost effective to employ as they do not receive casual loading, et cetera, so we rely on that paragraph and then ask the Commission to bear in mind what is said at paragraph 91 and this is not a paragraph which is challenged, as far as we can determine, in any of the materials or cross-examination and she deposes there to what may - I'm sorry, I didn't realise your Honour didn't have it.

PN1950

JUSTICE ROSS: No, no, it's only me that didn't have it but - - -

PN1951

MR DIXON: There was not a great deal before your Honour got the document. I dealt with paragraph 25, particularly (b), but I just ask your Honour to note it, and then paragraph 91 and your Honour will see in 91 that McDonald's will decrease the number of part time employees and increase the number of casual employees, et cetera. If it could not flex up part time hours under the agreement, the cost of overtime would substantially increase and not be limited to those hours above 36 per week currently under the agreement and in 93, she deposes to what, from McDonald's perspective, is regarded as the significant administrative burden which it regards as a relevant factor and we would seek to rely on what she deposes to in that paragraph and emphasises that the position on managers in dealing with these matters and the period of time that is required.

PN1952

Can I then turn, and in this regard, to the evidence of the deponents who were not required for cross-examination and the first of those is the affidavit of Mr Sullivan, which is exhibit AI GROUP9, and Mr Sullivan is an operator of Hungry Jack's restaurants, franchised restaurants. They set out in paragraphs six through to eight of his affidavit of 22 February 2018, and the Commission will see that his restaurants in Spargo 10 and Northern Food Service are covered by, and the employees are engaged according to, the Fast Food Award of 2010.

PN1953

In paragraph 30, he deposes to the use of casuals and you'll see that he says that he:

PN1954

Always uses casual employees to work the extra hours created by these increases in demand. I do not employ part time employees at all for the reasons I set out in paragraphs 38 and 39

PN1955

and then in 38, he gives those reasons, I'm clearly not going to read them but the Commission will see it's the requirement to vary regular pattern of work is regarded as too cumbersome.

PN1956

He talks about the inflexibility and one of the factors which you will note in paragraph 38, which also found support in other evidence such as that of Ms Montebello‑Hunter, is that restaurants are fast paced, staffing changes must be quickly and easily done. You don't want to - especially at peak periods, and you will see in paragraph 38 he says it's

PN1957

financially prohibitive to pay part time employees at overtime rates

PN1958

et cetera.

PN1959

Paying a part time employee at the overtime rate is more expensive than paying a casual employee at the ordinary rate of casual loading

PN1960

because of the differential in loadings that come from clause 13.2 and clause 26 of the award, and may we also then draw attention to the unchallenged evidence in paragraph 41 which Mr Sullivan deposes to and your Honour and Commission will see that it's the flexibility that is important to an operator of this kind.

PN1961

He says:

PN1962

By being able to flexible with the hours and removing the requirement, it make it much easier for me to use part time employees. It would mean I would employ part time employees in lieu of casuals whereas at the moment it doesn't. It would help the retention challenges so that they're - and part time employment is more attractive to people who want long term employment.

PN1963

He deposes there to what are clearly benefits from the employer's perspective and from the employee's perspective, you'll see security of income, important for many reasons and (indistinct) in respect for the (indistinct). His restaurant also operates on a basis that any changes effectively - are just produced through either an availability book or email, which are attachments to his statement.

PN1964

The next affidavit which I wanted to refer to is that of Mr Chapman and that is AI GROUP10. Mr Chapman made his affidavit on the - affirmed it on 21 February 2018 and the Commission will see that he operates Hungry Jack's franchised restaurants effectively at various airport outlets and he sets those out at paragraphs six and seven of his affidavit and then in paragraphs 19 and following, he deals with the various changes which he encounters in his restaurant.

PN1965

The paragraphs 19 through to 23, we wish to emphasise. Those are the types of changes which (indistinct), as the heading above paragraph 16 suggests, to predictable increases in demand or known staff availability issues and he says in 19:

PN1966

Part time employee change their availabilities less frequently than casual because they have a regular work pattern

PN1967

and 20:

PN1968

If a part time employee change in availability requires a manager to find a replacement to work the hours, a casual will always be used. Finding a replacement employee can be a time consuming process. It could be made even more time consuming if the replacement employee was a part time employee because the manager would also have to document in writing

PN1969

and he goes on to say:

PN1970

Less work doing for a casual

PN1971

and then paragraph 22 is also in the predictable category and he there refers to the managers use casuals rather than part time employees and the Commission will see in the last two sentences to that paragraph:

PN1972

The casual ordinary rate plus the 25 percent loading is less than the overtime rate for part time employees under the award. Also the requirement under the award to agree in writing in advance is too cumbersome

PN1973

And in 23, he contrasts the position:

PN1974

If there were no requirement to make the agreement, the manager would definitely use part time employees to meet times of extra demand and I would employ more part time employees in lieu of casuals

PN1975

And he goes on to justify that:

PN1976

Part time employment is more attractive than casual employment for many employees because it is more secure and the like.

PN1977

Again, emphasising the benefit to the employer and the employees. In relation the unpredictable increases, and the Commission has heard quite a bit of evidence about the unpredictable increases that are required by reason of no shows and matters of that kind, you will see that Mr Chapman says, in paragraph 28:

PN1978

For the same reasons I set out in paragraph 22

PN1979

And paragraph 22 is the reason why casuals are used.

PN1980

The managers will not call in part time employees to be a replacement for the employee who has changed their availability after the roster has been published

PN1981

And in 29, similarly:

PN1982

Managers in the restaurants that employ part time will try to avoid asking part time to stay back

PN1983

et cetera, and he goes on to talk about the fact that there is a further factor in his restaurants whereby managers would prefer for part time employees not to be paid but to take time off in lieu because that can happen at a time which has less impact on the business and lastly, in relation to his, Mr Chapman's, evidence, we ask the Commission to have particular regard to paragraph 31 where he refers to the challenges that managers face.

PN1984

They're already stretched with numerous tasks and duties to consider throughout the day. Difficult and time consuming and impractical for manager to obtain these written agreements each time. As a result, I employ less part time employees generally and the managers simply do not consider using part time to work extra hours to meet increases in demand or availability issues.

PN1985

Again, there was no challenge to that evidence given by Mr Chapman. May you then turn to the affidavit of Mr Alexander Martinoli, that's AI GROUP11. He's a department manager for a McDonald's restaurant located in Norwest Market Town, Baulkham Hills in New South Wales and the Commission will see he sets out his role as a department manager in paragraph four and then in paragraph 21 and 22, he addresses the question of administrative burden of the writing requirement of the award and he talks about his

PN1986

Approximately three part time crew members and five casual change their availability each week.

PN1987

22:

PN1988

In my experience, approximately nine crew members change their availability each week

PN1989

And in 25, he compares the flexibilities available with offering additional hours to casuals as opposed to part timers and you will see in that paragraph he talks about:

PN1990

It is currently easier for part time employee works extra shifts during the week because all they need to do is to work the additional hours and clock off end of the shift

PN1991

And he compares that, as you will see in the balance of that paragraph, to:

PN1992

If a written agreement was required the burden it would impose

PN1993

and he talks about managers who are generally operationally focussed.

PN1994

Mr Martinoli's evidence is also of, in our respectful submission, real assistance because here is someone who is actually studying at the same time and he talks, in paragraphs 42 and following, of the very significant benefits there are to him as an employee and as a university student but employed on a part time basis and you will see in paragraph 42 that he says:

PN1995

In my experience, flexibility is a key selling point for working at Norwest Market Town. Young workforce

PN1996

Et cetera,

PN1997

taking account of schooling university commitments.

PN1998

But then the Commission will see, in 43, he says:

PN1999

As I am a university student, flexibility in my working hours, very important to me. This is the only job that provides me with a flexibility when my university timetable changes each semester, for example, if I need exam time or if I want to work more, et cetera. With the high level of responsibility and a good pay packet, if I did not have flexibility in my hours, I would not be able to work at Norwest Market Town

PN2000

And in 44, he emphases the changes that his university courses require:

PN2001

Semester can be quite different.

PN2002

It impacts on his availability, his part time position allows him to do that. He can increase his hours in university holidays. He also goes on, in paragraph 44, to talk about what he regards as a contrasting position in other enterprises and also from his experience of talking to his peers at university and it's clear from his evidence that the ability to be a part time employee whilst studying and have the flexibility is a very important aspect to him.

PN2003

46, he talks about what he's using his annual leave during exam time and in 48, you will see he talks about his:

PN2004

Access to leave is obviously integral to maintaining my work, life and study balance. It allows me to meet my financial commitments and live comfortably

PN2005

Et cetera.

PN2006

If I was not able to have paid leave during a time, I would find it very difficult to support myself financially

PN2007

And 50, he talks about flexibility is important to assist in staff retention and 51, he indicates that he's been engaged by McDonald's on a part time basis for approximately six years.

PN2008

There is someone who is talking from personal experience, both from the managerial position and from being a student at the same time, of the benefits of more flexibility and the benefits of getting the additional hours or having flexibility as a part time employee. May we then ask the Commission to turn to the affidavit of Ms Kate Swan, AI GROUP12, affirmed on 16 February 2018. She is a certified restaurant trainer for Hungry Jack's and she indicates, at paragraph three, worked at approximately 12 Hungry Jack's restaurants across New South Wales.

PN2009

In paragraph 15 through to 18, she deals with the question of part time employees represent approximately 97 percent of the Cabramatta workforce that she deposes to and then in 15:

PN2010

The reason why part time employment makes up an overwhelming majority is because it works for the employees and it works for Hungry Jack's restaurants

PN2011

and she gives examples of that.

PN2012

In 16, she says:

PN2013

It provides the employees with greater employee benefits

PN2014

et cetera.

PN2015

More secure form of employment

PN2016

And in 18:

PN2017

In my experience, part time employment suits students, for example, university students. Each semester they will need to change

PN2018

et cetera, and can we then just also highlight the flexible part time work arrangements that she refers to in paragraph 41.

PN2019

She indicates that she's had discussions with the employees:

PN2020

They prefer part time positions because they are guaranteed at least nine hours of work every week

PN2021

and then she goes on to talk about what those benefits are, regular, consistent income and the like, and in 43, she says that

PN2022

Flexible part time arrangements also benefits Hungry Jack's restaurant managers because those employees with more experience are given more hours of work because of the experience

PN2023

And 45:

PN2024

Cabramatta uses annual leave during university - part time employees typically use annual leave during university holidays, during exam periods and the like

PN2025

And in 48, she expresses a view in relation to the existing award clause, which is set out at paragraph 47, that being clause 12, and makes the emphasis that:

PN2026

The industry is a very fast paced industry. Fast paced managers prioritise customer service

PN2027

et cetera.

PN2028

That gives some more context to the operation of part time and the need for flexibility. The last of the affidavits that were tendered without requirement for cross‑examination is that of Ms Leasa Guilk, G-u-i-l-k, AI GROUP13 is the exhibit, and she affirmed her affidavit on 23 February 2018. She's a restaurant manager at the Hungry Jack's restaurant located in Glendenning in the city of Blacktown in New South Wales and she refers to the Hungry Jack's New South Wales agreement, which she describes in paragraph 18, and in 21 records that:

PN2029

It does not require the recording of an agreement prior to an increase or decrease in hours

PN2030

and paragraph 24 to 29 deposes to what are regarded as the benefits of part time employment.

PN2031

I don't intend to read all of those but would invite the Commission to pay regard for that and one would contrast that position with the position if there were casuals being employed. Can we then turn to the first of the changes and that is the evening penalty matter and we start in that regard by asking the Commission to really refresh memory by reference to the common issue award flexibility decision which is now reported in the Industrial Reports at volume 252 IR 256. We have a bundle of authorities which we seek to hand up. Thank you.

PN2032

MS KELLY: Your Honour, can I ask if any arrangements have been made to have those authorities provided to those of us in Melbourne?

PN2033

MR DIXON: No, they are referred to in the written submissions and the - as I understand it the organisation there will have a right of reply in due course.

PN2034

MR BRUNO: I note that I don't have a copy but my learned friend has indicated that I might be able to share with him today.

PN2035

JUSTICE ROSS: Ms Kelly, you'll be able to pick up a copy from the Commission Registry in Melbourne tomorrow morning.

PN2036

MS KELLY: I'm grateful, thank you, your Honour.

PN2037

MR DIXON: If necessary we would - - -

PN2038

JUSTICE ROSS: No, no, we'll take care of it, that's fine.

PN2039

MR DIXON: Thank you, your Honour. I was not aware that there was not going to be anyone here today.

PN2040

JUSTICE ROSS: No, no.

PN2041

MR DIXON: The question in this case of course was award flexibility and at paragraph 130 of the Full Bench's decision and I know your Honour is very familiar with this, noted in paragraph 130 the provisions of section 139 as to what a modern award may include but what we principally wanted to draw attention to is what is at 139, the bottom of page 295 and that is what meaning is to be given to the term "a facilitated provision".

PN2042

The Commission will note that in paragraph 139 that Full Bench referred to the September 1994 safety net adjustments and review decision and the point that we seek to emphasise is the extract from that decision which appears at the top of page 296. The important aspect in our respectful submission in relation to this part of the claim is that a facilitated provision can take more than one form. It can either be an individual agreement between employer and an individual employee or the majority of employees in the enterprise or part of the enterprise concerned where an award clause contains a facilitated provision and establishes both the standard award condition and the framework within which agreement can be reached as to how the particular clause should be applied in practice.

PN2043

With that in mind, may we - in my submission, with that paragraph in mind turn to the submissions that were filed in reply on 12 July 2018 on behalf of the Ai Group and there is a schedule entitled "Schedule R1" to those submissions. If one bears in mind that flexibility provisions can take either a majority employee concern approach or an individual approach, an analysis has been carried out of some of the award provisions in modern awards. The Commission would see that in paragraph 12, the Ai Group notes that the clauses that are set out in 61 examples attached relate to the various averaging provisions set out in the subparagraphs.

PN2044

So one finds, and I'll give the Commission a few examples in a moment. The averaging of ordinary hours of work, the spread of ordinary hours of work, the duration of a shift, the start time and end time of shifts, the time taken for meal breaks and test breaks, the days taken as public holidays, annual leave, roster days off and I don't need or wish to impose on the Commission unduly but if one then looks at the analysis that follows, one will find numerous examples of changes of the character identified in the earlier paragraphs of changes that may occur by agreement between the employer the majority of employees concerned. It relates to just the first example, the ordinary hours of work can be changed in that fashion.

PN2045

If one looks at the Airport Employees Award 2010 at the bottom of the last column on that page, clause 27.3(e), Variation:

PN2046

The method of working shifts may in any case be varied by agreement between the employer and the majority of employees concerned at the time of commencing shifts

PN2047

and so on. The Commission being experienced as it is in this area would know that there are very, very many examples of a flexibility agreement that is not dependent on the individual entering into an IFA but where there is a majority decision which can be taken to suit the particular circumstances and flexibility.

PN2048

JUSTICE ROSS: What one could also observe is that the flexibility clauses that you've gone to were also clauses in the main that were in pre-modernised awards, and came in following the third safety net section 150A decision. So they in that sense pre-date the IFA provisions in the Act.

PN2049

MR DIXON: Your Honour, but in relation to those provisions now the IFA provision are also in the awards.

PN2050

JUSTICE ROSS: No, no, I know that because they have to be.

PN2051

MR DIXON: Yes.

PN2052

JUSTICE ROSS: But my point is that they come with a history and they've I think as Ai Group put successfully in relation to this award, during the penalty rate case, that the modernisation process didn't closely look at the merit of various provisions, rather looked at the predominant conditions as they appeared in pre-modernised instruments. The only observation I was making is you made the point that those provisions don't require the entering into of an IFA, and that's true, they don't. It's also correct that the IFA provision sits side by side with those awards. My observation is only that maybe a function of history, that the facilitative provisions came into the pre-modern awards first and the IFAs had come in as a consequence of the legislative provisions, and we end up with where we are. I don't think it's been a conscious decision unless you can take me to one where the Commission has expressly said that they have looked at the IFA provisions of the facilitative provisions and have formed some view about the relative merits. It's just they're both in the award but they're both in the award because of the history. That's how they got there.

PN2053

MR DIXON: What is apparent though from that history is that on a range of matters the Commission in satisfying the modern award objective has been satisfied that the provision of that kind of the majority agreement would satisfy the modern award objective.

PN2054

JUSTICE ROSS: Well, that's been - that's the prima facie position, yes.

PN2055

MR DIXON: Within the context - - -

PN2056

JUSTICE ROSS: It's not been, you know, I don't think one can say there's been the - that's the necessary consequence of the making of the awards, and the statutory framework on the making of them is substantially similar to what is now section 134. So there is that presumption that the Commission on the making of them was satisfied they met the modern award objective. But I'm only observing that I doubt just based on the ones that I've looked at more closely, that in the awards in which you've taken us to that there was some lengthy debate about the merits or otherwise of the provision, that's all.

PN2057

MR DIXON: Your Honours, I'm not in any way suggesting otherwise. What I was going to add is that it's in the context as your Honour described, the historical context that they came into the award. These are provisions which sit comfortably in awards and they've operated in awards for a considerable period of time with no apparent disharmony. If one looks at that list that I've put there and the suggestion that was put in this case that there might be some disharmony, by reason of - - -

PN2058

JUSTICE ROSS: Yes, the majority voting and - yes.

PN2059

MR DIXON: - - - the majority, there is absolutely nothing in that point, in our respectful submission, because you would have expected - - -

PN2060

JUSTICE ROSS: Well, I suppose one could say the same about enterprise agreements. If you - - -

PN2061

MR DIXON: Exactly.

PN2062

JUSTICE ROSS: It's a majority voting and I mean you couldn't exclude the possibility that there will be somebody whose vote didn't hold sway in the end that might be irritated by that, but as you say we have had majority facilitative provisions in awards for a number of years, and indeed that's what enterprise bargaining is predicated on.

PN2063

MR DIXON: With respect, your Honour, that's the way in which the Act operates and the way in which the instruments operate in that regard. So the Commission will also recall that the stage 3 - Award Stage Group 3 decision, which is [2018] FWCFB 1405, which is the last case in the bundle. Again, your Honour, the President, presided on a Full Bench there, it's on tab 6 of the bundle, dealt with insertion of or at least proposed insertion of alterations to the spread of hours provision.

PN2064

One can see at paragraph 184 the - yes, the first paragraph is 185 where the Commission refers to an October 2017 decision, we dealt with the issue relating to the alteration of the spread of hours in the exposure draft. At 186 there is then a provisional view as to why a clause of that kind as set out in subparagraph 13(c), in paragraph 186 should not be included in the - at least the Sugar Industry Award that was then under contemplation. We recognise that the process might not yet be final but the Commission is certainly prepared to entertain a majority clause in relation to the change of the spread of hours.

PN2065

When one then comes to deal with the submissions in relation to that point and change, the Commission will note in the Ai Group submissions of 12 July 2018, the submissions are set out in relation to what is described as claim one, the facilitative provision to end time of night shift. The background factors are set out in paragraphs 28 through to 34. The essential issue is that the matter at issue is whether there is a flexible and administratively less burdensome means of obtaining agreement from employees in the employees' business.

PN2066

The Ai Group submits that the existing evening penalty clause does not facilitate the making of flexible working arrangements for large groups of employees by efficient means. It makes that submission firstly given that the number of employees making themselves available to work in this sector - particularly those covered by the enterprise agreements - between 5 am and 6 am is significant and secondly that there is no effective mechanism such as that proposed in the draft determination to efficiently adjust by agreement the penalty rate between 5 am and 6 am.

PN2067

AiG therefore submits that the present provisions fail to achieve the modern awards objective. It is our submission that it is likely that the proposed facilitative provision would be utilised by participants in the fast food industry and that is supported and illustrative by reason of the practice that has occurred under the McDonald's enterprise agreement and the Hungry Jack's Queensland agreement and the Hungry Jack's South Australia and Northern Territory agreement, where they have adjusted by agreement the penalty rates such that it is not payable between 5 am and 6 am.

PN2068

Of course it is recognised that not every employer operates under an enterprise agreement but provides that facility but employers and employees not covered by an enterprise agreement will benefit from the flexibility and the experience in Hungry Jack's and McDonald's indicates that a facilitative provision, which does not impose the 5am to 6am penalty, can operate in an efficient fashion. In paragraph 32 of our submissions we've described what happens under the McDonald's agreement and also the fact that currently in McDonald's restaurants more employees making themselves available between 5 am and the positions that may be filled and in paragraph 32 - I'm sorry, I withdraw that.

PN2069

When one - the specific findings which Ai Group seek to rely upon in respect of this variation are those set out in the findings document paragraph 11 through to 17 and I don't need to address those because the Commission now has those identified specifically and there may be some limited challenges to those. May we however in relation to some of the evidence that was given refer to the supplementary submissions that were filed on 18 July - yesterday - and the Commission will note that at paragraphs 14 and 15 the Ai Group deals with the SDA cross-examination in respect of the variation that was being sought and the process for making an IFA being not much more burdensome than making a majority employee facilitative provision. That appeared to be the thrust of the cross-examination.

PN2070

That is dealt with and responded to in paragraphs - firstly 14, which takes issue with that line of argument, indicating, of course, that the process of explaining the making of a majority employee provision could be done collectively as opposed to individually. The involvement of guardians in IFA will need to be individualised but the involvement of guardians in the making of a majority facilitative provision could be done collectively. The better off overall test is a factor and the use of a template IFA will not necessarily shorten the time taken to prepare the IFA, particularly given the need to check.

PN2071

Then in relation to the other line of cross-examination by the SDA, we deal with that in paragraph 15, the suggestion that in terms of varying the end time there is likely to be no benefit to an employee from the removal of the evening penalty rate. But we set out there examples of what the variation could bring. It might suit the personal circumstances of an employee, such as whether they are able to work between 5 am and 6 am, when they might otherwise not be rostered in that period, complete their hours or work earlier in the day and therefore be able to attend their studies and engage in leisure time earlier in the day and also the variation in end time and the removal of the penalty rate may lead to the employee greater number of hours of work over the week.

PN2072

When one then comes to deal with the section 134 factors, these have been addressed in the submissions of 12 July at paragraphs 40 and following and the Commission will note - and I hope I don't do this too peremptorily or quickly - from the paragraphs of 40 and following that if one looks at the various factors in section 134(1), in our respectful submission 1(a) is neutral for the reasons set out in 40 and 41. 1(b) is neutral for the reasons set out in paragraph 42. 1(c) is neutral for the reasons set out in paragraph 43 and 44. 1(d)(a)(ii) and (iv), we submit is neutral for the reasons set out in paragraph 45. 1(e) is neutral for the reasons set out in paragraph 46. 1(g) - 19(e) in 46 and then can I just deal with all the neutral ones first, if the Commission pleases?

PN2073

1(g) is neutral for the reasons set out in paragraph 49 and 1(h) is neutral for the reasons set out in paragraph 50. That leaves one with paragraph or the factors in section 134(1)(f) and those are dealt with in paragraphs 47 and 48 of the submissions. Those are in our respectful submission positive factors and if one then adds what is set out in paragraph 51 and 52, the positive factors outweigh, in our respectful submission, any prejudice or negative factors when one applies section 134. The paragraph 52 the Commission will see we submit that the need to consider contemporary circumstances is a favourable consideration and that refers back to paragraph 9 of the submissions and those are in paragraph 9 set out the various decisions in which that proposition has been stated and one notes one of the most recent ones is the horticultural award decision, where there is in 2017 FWC FB 6037.

PN2074

So the matters that are set out in paragraphs 51 and 52 in our respectful submission add to the positive nature and support for the proposed changes meeting the factors in the modern awards objective in section 134. Can I then also in relation to this aspect of the claim refer to the AiG reply submissions of 12 July 2018? In those reply submissions Ai Group is responding to the SDA's submissions that were filed in these proceedings on 16 March 2018. In paragraph 3 the Ai Group rejects the submissions of the SDA. I simply wanted to highlight what is in part of paragraph 3. The Commission will note in paragraph 3(c) the emphasis is on the size of the group, which extends to over 12,000 employees in an operation such as that of McDonald's - employees who could make - who do make themselves available on the evidence of Ms Anderson to work those additional hours.

PN2075

In order for them under the present arrangement to take up that option at the lower rate they would have to enter into an IFA. In subparagraph 3(d) there is a rebuttal against the suggestion by the SDA that there is a limited operation and the burden is not as great as Ai Group has portrayed but the fact is set out in paragraph 3(d)(i), (ii), (iii) and (iv). All counter the arguments put by the SDA. We submit that they've understated the number of employees. They don't assume the same employees will be available each week, et cetera. Then we also draw attention specifically to paragraph 3(e), the fifth point in that paragraph, when it is submitted that contrary to the assertions by the SDA there is no compromise, let alone an inherent one in the integrity of a penalty rates system if a majority of employees agree to vary the end time of the evening penalty rates.

PN2076

That paragraph also then picks up what we submitted earlier, in relation to the various clauses set out in schedule R1 and also the proposed change in the Sugar Industry Award. In our respectful submission the suggestion that a group majority vote would in these circumstances compromise the integrity of penalty rates systems when it is accepted it appears by the SDA that the same result can be achieved but with significant industrial burden and administrative burden should be rejected. So for all of those reasons, in our respectful submission, there is merit in adopting no more than an alternative means of achieving the flexibility which the Act emphasises as one of the objectives to be achieved in the modern awards and in the exercise of the Commission's powers.

PN2077

May I then turn to the second issue, and that is the proposed variation to clause 12.2 of the Fast Food Award? May I simply ask the Commission to note the findings in that regard, apart from the general findings which are sought - specific findings in relation to this aspect are in paragraphs 18 to 31 of the document filed on 12 July 2018.

PN2078

When I say, "In addition to the general findings", those would be the findings in paragraphs 1 through to 10, which talk about the - which are findings in relation to the profile of the industry employment age groups, the student population, et cetera, and then - but the specific findings in relation to what is described as Ai Group claim 2, the flexible part-time clause, are set out at paragraphs 18 to 31. In broad terms the submission on the part of Ai Group in respect of this claim is that the existing clause acts as a discouragement to the engagement of part-time employees and to the use of part-time employees to work additional hours. Secondly, it imposes an impractical administrative burden on employers in the form of the requirement to reduce to writing the agreement to work additional hours when and in the circumstances that are set out in the award and is thereby failing to meet the modern awards objective.

PN2079

In our respectful submission the existing part-time clause does not bear upon or connect with the contemporary circumstances in the fast food industry, including the unpredictable fluctuations in customer demand. The Commission will recall that in the part-time and casual employment decision, which is reported at volume 269 of the Industrial Reports 125, it was concluded that in the Hospitality Award that there was no proper connection with the contemporary circumstances, including unpredictable fluctuations of demand and thereby that award - and I'm going to come to it - was a failure to meet the modern awards objective. It might be convenient if I may approach this to ask he Commission to turn to the comparison table which your Honour the President invited us to file when we appeared previously.

PN2080

But may I start with the comparison of the fast food award and the proposed variation sought by the Australian Industry Group? They're the two tables. The other one deals with a comparison with the hospitality and other awards. I do propose as I go through the table comparing the present clause 12 and the proposed clause to make some comments and the Commission, if I may respectfully say so, might find it helpful to notate some of the provisions that come from the hospitality clause as one goes through it, because that would assist in the later analysis. One of the points that we want to emphasise in relation to the proposed variation is that there are a number of safeguards in the proposed clause. The second point we want to emphasise as one goes through it is that there is a significant consensual element afforded to employees in the proposal as it is put forward and in the way in which it is set to operate.

PN2081

Can I start by going to clause 12.2? I'm now dealing with the proposed clause in the right-hand column. The Commission will see that this is one of the essential elements of the proposal. It provides a safeguard in the form of a written agreement in two respects. The first is that the written agreement must record the number of hours of work which are guaranteed to be provided and paid to the employee each week or if there is a roster system, over the roster cycle. They refer to as the guaranteed minimum hours. The Commission will see that immediately in 12.4:

PN2082

The guaranteed minimum hours shall not be less than eight hours per week.

PN2083

MR DIXON: So there is an additional guarantee built in which of course feeds into the agreement in relation to the guaranteed hours. But at the same time, the agreement that is referred to in 12.2 requires agreement on the part of the employer and the employee as to the days of the week and the period in each of those days when the employee will be available to work the guaranteed minimum hours. They are referred to in the clause as the employees' agreed availability. In our respectful submission a written agreement in that form sets the parameters upon which the clause will operate and it provides significant protections to employees as to when payments are to be made and when overtime will apply and when ordinary hours will apply.

PN2084

If one then goes to 12.3 there is a protection that an employee may not be rostered to work less than three consecutive hours in any shift. 12.5 is a further protection. It provides that:

PN2085

Any change in the guaranteed hours may only occur with a written consent of the part-time employee.

PN2086

MR DIXON: So the written agreement that is contemplated in 12.2 may only - the hours may only be changed in respect of the guaranteed minimum hours by reason of clause 12.5 in writing. Now, at 12.6 it provides for the alteration of agreed availability and as we will see in a moment, 12.6 has its origins in the hospitality award clause 12.7 so this is a provision which was inserted into the hospitality award in the part-time and casual case. It makes provision for an alteration of availability in certain circumstances. Then one comes to clause 12.7 and 12.7 is a provision which permits an employee to be offered ordinary hours in addition to their guaranteed minimum hours but the Commission will see it is conditioned, firstly, that that offer relates to the period of the employee's agreed availability.

PN2087

So in the first instance, that offer, if there is going to be ordinary hours, it's got to be within the employee's agreed availability. Clause 12.7, however, goes further. It provides additional protections because the proviso is set out in 12.7(a) and following conditions the offer. Firstly, in subparagraph (a) that has got to be in accordance with clause 25 and 26; secondly, the employee must not be rostered for work outside the employee's availability; thirdly agreed additional hours are paid at ordinary time including penalties and accrue entitlements such as annual leave and personal leave and then fourthly, the agreement to work the additional hours may be withdrawn by a part-time employee within 14 days' written notice.

PN2088

It's spelt out that it's not overtime and where there is a requirement to work overtime in accordance with clause 6 overtime rates will be paid. So again, in our respectful submission, there are significant limitations and protections encompassed in clause 12.7. 12.8 is a provision that protects existing arrangements or agreements and that is similar to what was inserted into the hospitality award in clause 12.11 of the award provision that found its way into that award. 12.9 is in a further benefit to employees and the Commission will see - again, this comes from the hospitality award provision clause 12.6 - and the Commission will note that this is a provision which permits a part-time employee who has, over a period of at least 12 months, regularly worked a number of hours may request in writing that the employer agree to increase the guaranteed minimum hours.

PN2089

If the employer agrees to that request - et cetera. So that is a provision which is presently in the hospitality award and which is being adopted. 12.10, again, is a hospitality award provision. Clause 12.9 deals with the casual employment. 12.11 deals with the part-time employee employed under the provisions of the clause must be paid for ordinary hours worked at the rate of 138, the minimum weekly rate prescribed for the class of work performed. Then of course it's necessary to have consequential changes which brings one into the realms of clause 26 of the award. On the last page - sorry, the second-last page, page 3 of this table, the Commission will note that in respect of the fast food industry award clause 26.2 combines the position of a full-time or part-time employee.

PN2090

What is proposed in the right-hand column is dealing with a full-time employee and a part-time employee's entitlements differently and 27.2 therefore would encompass the full-time employee's entitlements but without any material change. 27.3 then picks up the part-time employee provision which must flow from any change that is made to 12.2. the Commission will see that that is the overtime provision that applies in excess of 38 hours or five days and in subparagraph 27.3(b), "Hours worked by a part-time employee outside the employee's availability." So again, this links back to 12.2:

PN2091

No overtime within employee's availability but overtime outside availability or outside the ordinary hours of work.

PN2092

MR DIXON: 27.4 is a provision which also protects employees and requires the payment of overtime if the employee is directed to work before the employee's rostered commencing time or after the employee's rostered ceasing time on any one day. 27.5 is a matter to make clear that when no overtime is paid in those circumstances.

PN2093

What we respectfully submit is that the clause proposed provides a significant degree of flexibility and we respectfully submit that the protections are sufficient for employees and by adding a requirement such as this that presently exists in clause 12.4 of the existing award would add an administrative burden which really removes the flexibility or undermines the flexibility which the clause is otherwise designed to achieve. We rely in respect of the benefit to employees on the finding which appears not to be challenged at paragraph 31 of the findings document that there are benefits to employees.

PN2094

May I then deal with the question by asking the Commission to turn to the second table and that's the comparative table and at the same time it might be helpful if the Commission had to hand the submissions of 12 July starting at paragraph 80. Paragraph 80 of those submissions, not the reply submissions, dealt with the differences to the flexibility part time clause in the Hospitality Award, Restaurant Award and Clubs Award which are set out in the table which the Commission invited us to provide. It will be seen from those submissions and by reference to this table, and I don't wish to spend too much time with it, but there were essentially six major differences between the proposal flexible part time clause and the flexible part time clause inserted into the Hospitality Award.

PN2095

It may be convenient, if I may respectfully submit, for the Commission when it deals with each of those changes, I will identify the paragraph following which explains the effect if any of the change. So the change is that there is no express statement in the proposed clause that provides a part-time employee may be employed in any classification in the Fast Food Award. And that is responded to in paragraph 82 where we submit that the first difference is not material as the absence of an express statement is consistent with the implied ability of an employer to employ part-time employees in any classification in the Fast Food Award.

PN2096

The second change is that there is no statement in the proposed clause that enables the hours of part-time employees to be averaged over a roster cycle and that is dealt with in paragraph 83. In paragraph 83, we submit that the second difference is consistent with the crew rosters in the Fast Food Industry Award being of a week and there is evidence supporting that proposition and not fortnightly or monthly with the resulting absence of a need to refer to averaging over a roster cycle.

PN2097

The third change is that the proposed clause includes a provision specifying the minimum number of consecutive hours in a shift. That is clause 12.3 and that is dealt with in paragraph 84 and the Commission will see that we submit that the third difference provides the additional protections to part-time employees and reflects and continues the existing clause 12.5 of the Fast Food Award.

PN2098

The fourth difference is that set out in paragraph 80(d) and you will note that that specifies that the guaranteed minimum hours shall be not less than eight hours per week. There is no such express provision in the Hospitality Award, but where the proposed clause, see 12.1(a) and the Hospitality Award, clause 12.2(a), otherwise specifies that the guaranteed minimum of hours shall not less than eight. In relation to that paragraph, the response is that it is set out in paragraph 85 and it really is not a necessary provision.

PN2099

The fifth and sixth changes are obviously at the core of what is proposed. Those are dealt with in paragraph 80(e) and 80(f) and the response to those changes are set out in paragraph 86. The AiG Group submits that those differences overcome, firstly, the lack of flexibility in the present provision. Secondly, the administrative burden of the existing part time clause in the Fast Food Award and one notes that it is intended that the part-time employee would be paid overtime in accordance with the new part time overtime clause to be inserted into the Fast Food Award if he or she works more than 38 hours. Then for the avoidance of doubt there is also the payment of overtime in specific circumstances.

PN2100

The Commission will see from that that the proposed clause is substantially modelled on the Hospitality Industry Award clause and it provides, because of the minimum guaranteed hours and availability hours that have got to be inviting a significant level of protection which, in our respectful submission, is sufficient to avoid an administrative burden that any changes that are made either on a permanent basis or on a short-term basis need to be documented in order for there to be an offer of additional hours.

PN2101

The Modern Awards Objective factors are dealt with in paragraph 87 and following and the Commission will see in relation to those paragraphs that our submission is, in effect, that the positive factors outweigh any potential negative outcome. Subparagraph (1)(b), this is in paragraph 88, is a neutral consideration. (1)(c) is a neutral consideration. (1)(d)(a) is a neutral consideration. (1)(e) is a neutral consideration. That's in paragraph 92. (1)(g) is a neutral consideration. (1)(h) is a neutral consideration. Then paragraphs 96 and 97 are, we say, positive considerations and in respect of (1)(a) there is a positive consideration and we also submit in paragraph 90 that the section 134(1)(d)(a), promote flexibility, is a favourable and positive consideration for the making of the proposed changes.

PN2102

JUSTICE ROSS: I'm sorry, what was your last point? Which section?

PN2103

MR DIXON: Paragraph 90. I went back to paragraph 134(1)(d), promoting flexibility, practices and efficient productive work is a favourable consideration.

PN2104

JUSTICE ROSS: Thank you.

PN2105

MR DIXON: Is your Honour asking me about the section or the submission?

PN2106

JUSTICE ROSS: No, no, I just wasn't sure about the section you're referring to, that's all.

PN2107

MR DIXON: May we also draw particular attention to the reply submissions of 12 July 2018 in respect of the submissions that had been made by Ms Kelly's client and you will note, if the Commission has that to hand, that at paragraph 5 and following, we were addressing the submissions as were filed by that organisation, we understand on 9 March 2018. I want to draw particular attention to what is set out at paragraph 6(c), (d) and (e), in relation to those submissions. The submissions clearly misunderstand or ignore the effect of submissions on the discouragement of employment. The current requirement of the Fast Food Award to pay overtime rates for the additional hours acts to discourage employers and we've got findings to support that.

PN2108

In paragraph 6(d), we make reference to what was said in the part time and casual employee decision about the provisions not encouraging part time employment in the awards there under consideration as being a dead letter. But we point out that in relation to the Fast Food Award there are aspects that discourage part time employment and there are aspects of the reasoning of the Full Bench, especially that relating to the need to ensure that the relevant award meets contemporary circumstances supports its application.

PN2109

Paragraph (e), we emphasise that Ai Group is not simply demanding that employers be relieved of the burden of documenting short-term contracts or variations and I don't need to read that further.

PN2110

In relation to the submissions that were described as supplementary submissions and those that were filed on the 18th, yesterday, we have set out in those submissions an analysis of the evidence based on the cross-examination which occurred, of course, on behalf of Ms Kelly's client. May we simply ask the Commission to note that there is no requirement for Survey evidence to support an application. There is no evidence that that organisation has consulted with the employees in the fast food industry in opposition to the application and there is no logical basis for a difference in rostering practices between stores applying an enterprise agreement and stores applying the Fast Food Award, particularly when these are the matters set out in subparagraph (2)(f), and I don't read them, but may I just add to that.

PN2111

If the Commission bears in mind the profile of the workforce and industry which is dealt with in our earlier submissions, that profile must feed into an assessment of whether you've got students and tertiary and school students. You've got a young workforce. You've got regular patterns of behaviour readily support the submissions that the Ai Group make that there is a need for flexibility at a significantly level and the findings of fact that we put forward, in our respectful submission, support that.

PN2112

You will note also in paragraph 5 there is a counter to the suggestion that there would be benefit from set rosters. We have set out there the evidence in relation to the impracticality of such a course. In paragraph 6, we have dealt with the suggestion that there is some incongruity in the requirement for writing for initial availability of changes and not for additional hours. But, in our respectful submission, those submissions have got to be taken into account and bear in mind the practical experience which has been found to exist through the McDonald's agreement and other agreements.

PN2113

The Commission will note in paragraph 6 of our submissions where we highlight that in relation to there being no requirement for writing under the McDonald's agreement, an agreement covering some 100,000 employees, there is no evidence of difficulty associated with a lack of written requirement for changes. The same is the case in relation to Hungry Jack's, covering a significant number of employees set out in paragraph (f) and 6(g). None of those organisations and no evidence has been provided on any difficulty from any employee in relation to the practices that have been adapted and adopted under those agreements which, in our respectful submission, provide to the Commission real evidence of how a clause of this kind can operate without causing any prejudice to employees or any perceived exploitation. In relation to any suggestion of a risk of exploitation, we have dealt with that at paragraph 8 of those submissions.

PN2114

The absence of certainty for an employee under the proposed clause is dealt with in paragraph 10 and there is no valid basis for such a submission because of the reasons we have set out there. The proposed clause reflects the standard clause in the Hospital Award, the protection to the requirement for the proposal that the hours be reasonable predictable and the like.

PN2115

So if I then indicate to the Commission that obviously we would seek to rely on all our written submissions and the analyses of the evidence and we would invite the Commission to make the relevant findings. But apart from that, if the Commission would just allow me a moment. Those are our oral submissions in support of the written submissions, if the Commission pleases.

PN2116

JUSTICE ROSS: Thank you, Mr Dixon. The money or the box time for you, Mr Bruno. What do you want to do?

PN2117

MR BRUNO: Yes, thank you, your Honour. I'm instructed that, well, I'm ready to proceed orally today. Having said that, the component of these proceedings which deals with the application to amend clause 25, so that's the facilitative provision issue, would that be finalised today? And what I mean by that, would my learned friend, to the extent that he wishes to reply to what I say on behalf of my client be dealt with orally today?

PN2118

JUSTICE ROSS: What's the answer to that question?

PN2119

MR DIXON: One of the difficulties of that is it doesn't appear to be capable of being concluded because I think Ms Kelly wants to say something about it.

PN2120

JUSTICE ROSS: That might be the case as well. I wouldn't foreclose the possibility of that. In any event, I don't think we would want to take a rigid view, even if you were to give your oral submissions and Mr Dixon was to give an oral reply, if something occurred to really either party in the subsequent filing of the written material, well, we wouldn't want to exclude that.

PN2121

MR BRUNO: Thank you, your Honour.

PN2122

JUSTICE ROSS: That being the case, you're free to do so now, but that wouldn't constrain Mr Dixon to either reply now or he could simply put it in writing later. So what do you - - -

PN2123

MR BRUNO: Yes, and if my client was given an opportunity similarly if something new came up in that then, yes, we're in the situation which your Honour was trying to avoid.

PN2124

JUSTICE ROSS: You might be better not to put an oral submission not and consider what has been put and file the material.

PN2125

MR BRUNO: Could I just quickly take some instructions?

PN2126

JUSTICE ROSS: Certainly, of course, yes. Otherwise, Mr Bruno, I'm just a bit concerned then we'll have a debate about, well, that wasn't in what you said.

PN2127

MR BRUNO: Yes.

PN2128

JUSTICE ROSS: And let's just have a cleaner process might be a safer course.

PN2129

MR BRUNO: Yes, and in light of that, it's preferable that I do put it in writing, your Honour.

PN2130

JUSTICE ROSS: I think so.

PN2131

MR BRUNO: And we need to come back anyway, it seems, in terms of the - - -

PN2132

JUSTICE ROSS: Well, not here, but - - -

PN2133

MR BRUNO: Somewhere, your Honour.

PN2134

JUSTICE ROSS: Yes.

PN2135

MR BRUNO: So my instructions are that we would like the opportunity to put that in writing by the time that your Honour indicated which was Thursday of next week.

PN2136

JUSTICE ROSS: And we'll issue directions confirming all of that and there will be liberty to apply, in any event. Any other questions at this stage?

PN2137

MS KELLY: There is no question, your Honour, but I wanted to extend my thanks to your staff in the Modern Award team who in the course of the oral submissions provided me with a copy of the folder of authorities. I'm very grateful.

PN2138

JUSTICE ROSS: No, not at all. All right, nothing further? We will await your written submissions and then we'll reserve, thank you.

ADJOURNED INDEFINITELY [12.07 PM]