1 December 2006

The Registrar

Australian Industrial Relations Commission

80 Collins Street

Melbourne 3000

Dear Sir/Madam

Re: C2006/3667- Application to vary Clerk’ (Oil Companies) Award 2002.

Drayton’s Workplace Consulting Pty Ltd acts for BP Refinery (Kwinana) Pty Ltd, BP Refinery (BulwerIsland) Pty Ltd and BP Australia Pty Ltd in this matter.

The BP companies oppose the application to vary the subject award.

The grounds of opposition are as follows:

1)The application is made in terms of Section 553. Subsection 553 (4) (a) requires that the variation is essential to the maintenance of minimum safety net entitlements.

The BP companies do not have any employees directly engaged in terms of the subject award. Any employees who may fall within the Scope and Application of the Award clause are engaged in terms of workplace agreements in terms of the Workplace Relations Act 1996. The operation of the Workplace Relations Act 1996 effects that on expiry or termination of such workplace agreements there is no reversion to the subject award. The maintenance of the agreement is not essential if there is no direct employment.

2)The variation seeks to increase allowances of First Aid (clause 18.4), Meal Allowances (Clause 19 and 29.7.4) and Telephone call-back allowance (clause 29.5).

The first aid allowance and telephone call-back allowance are not expense related allowances but are either skill or disability allowances. The meal allowance is an expense related allowance.

3)The increases sought to the skill and disability allowances are effectively increases to wage payments.

The increase of amounts that form part of wages is inconsistent with the decision of the Australian Fair Pay Commission. This prohibits the variation sought in respect of these allowances by virtue of section 553 (4)(b)(i).

(i)the award as varied would not be inconsistent with decisions of the AFPC;

The AFPC in its decision of October 2006 provides the following basis of increases.

• the close to 18 month period since the last pay increase for Pay Scale reliantemployees;

• the sensitivity of low-paid employment to changes in wage levels, as well as theincentives for individuals to seek and remain in paid employment;

• the fact that the economy and labour market have continued to perform strongly,although not uniformly;

• movements in consumer prices, as well as incipient inflationary pressure (and its effecton interest rates); and

• the requirement to provide a safety net for the low paid.

The inflationary growth and the provision of the safety net have been taken into consideration by the AFPC. Therefore it is submitted that as inflationary pressures have been contemplated by the AFPC, there is no requirement to adjust expense related allowances to provide a minimum safety net.

4)The increasing of allowances which is outside of the Australian Fair Pay Standard is a disincentive to agreement making.

If the Commission is satisfied that it can adjust expense related allowances then the C.P.I basis submitted by the ASU will be appropriate.

Should you require further information, please do not hesitate to contact the undersigned.

Yours Faithfully

Greg Power

CC: John Nucifora- ASU

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