24 October 2011 Executive Director Review of Retail Trading NSW Industrial Relations Department of Finance and Services 2-24 Rawson Place Sydney NSW 2000 FSU AUSTRALIA Dear Executive Director The Finance Sector Union of Australia (NSW/ACT Branch) (FSU) welcomes the opportunity to make submissions in response to the Review into the Shop Trading Provisions of the Retail Trading Act 2008 ("the Act") Discussion Paper dated September 2011. The FSU is the industrial organisation that represents workers employed within the finance sector in NSW and across Australia. Our members work for retail banks, business and investment banks, credit unions, building societies, insurance companies, superannuation funds and a variety of other finance related companies. As the relevant union for finance workers in New South Wales and the only collective voice available to the estimated 150,000 people employed in the NSW finance sector, the FSU is obliged to stress the importance of maintaining a focus on the needs of these people as they continue to make a significant contribution to the economic and social well-being of our state. We have had the opportunity to discuss the content of the submissions to this review of the SDA and Unions NSW. We support the submissions made by SDA and while we understand that Unions NSW has been granted an extension till 26 October 2011 to make their submissions, given our understanding of the proposed content of their submission, we expect that we will also be able to support their position. In addition to our support for the submissions made by the SDA and Unions NSW, we make the following specific submissions in response to the questions raised in Part 7, Questions 3 and 4 of the Discussion Paper. Question 3. What are the issues surrounding inconsistent treatment imposed on banks and financial institutions regarding 'bank close days'? The "inconsistent treatment imposed on banks and financial institutions regarding 'bank close days' " is only inconsistent vis-a-vis other businesses and service providers who operate outside the industry of banking and financial services and it is not uncommon for different industries to have different approaches to questions of opening hours. The banking and financial services industry is not synonymous with the retail shops industry and banks and other financial services providers are usually not direct competitors to retail shops. FINANCE SECTOR UNION OF AUSTRALIA NSWIACT Branch PO BoxA2442 Sydney South NSW 1235 Telephone 1300 366 378 Facsimile (02) 9320 0099 Email nswact@fsunion.org.au Afl correspondence must be addressed to the Branch Secretary.
Therefore the "inconsistent treatment" has no significant detrimental economic or social impact. The significant majority (estimated at 85% of the workforce) of the banking and financial services industry does not operate on weekends and has no desire to do so. This includes insurance claims assessment, share trading, international banking, settlements, corporate banking, institutional banking, superannuation, funds management and inter-bank exchanges. Significant parts of government, legal services and other industries also operate under different or regulatory regimes that are inconsistent with those that apply to retail shop trading without detriment to the retail shops. At the same time, the existence of EFTPOS, internet banking, a large network of ATMs and phone banking now provides comprehensive access for retail banking customers on 'bank close days'. While banks and financial institutions may share the locations such as shopping centres and retail precincts with other industries such as retail shops, the work done in banking and financial services is not the same as that done in retail shopping. The intrinsic nature of the work required to be undertaken by banking staff is high pressure and an extremely high level of competence, preparation and precision is expected of every retail banker. The retail banker's work does not begin as the doors of the bank branch opens and it is highly regulated. Careful and exact accounting, security and compliance checks are required to be undertaken daily by almost all staff within any bank branch. Part 3A of the Retail Trading Act 2008, as amended in 2011, provides for bank close days on state, regional and national public holidays, Saturdays and Sundays and the first Monday in August (Section 148). This provision was directly imported from the now repealed Banks and Bank Holiday Act 1912 (NSW) ("BBHA") making it a provision that has existed now for some 100 years. The BBHA did allow for weekend trading. The FSU strongly asserts that the replicated provisions in Part 3A of the Act regarding bank closed days are appropriate and provide banks and financial institutions with the required flexibility to conduct their respective businesses. The Act facilitates bank "trading" (but doesn't require inter-bank exchanges) on 'bank close days' through a permit process and these permits are subject to a public interest test. They may be granted either conditionally or unconditionally, with limited rights of appeal from interested parties. FSU believes that this section of the Act must be retained as it currently stands. The current provision provides adequate flexibility so that banks are able to obtain weekend trading permits, but also puts in place limited administrative review of any decision of the Director General of the Department of Commerce. The FSU asserts that the permit and review mechanisms are essential for providing adequate balance between protections for employees, the community and the banks in question. The operation of this provision has continued to provide the socially desirable balance between branch opening hours of banks and the protection of employee entitlements. Every major bank in Australia has applied for and has been granted a licence to open its branches on either Saturday or Sunday or both. The banks that have successfully applied to open on weekends include: -2-
+ Australian and New Zealand Banking Group Limited (ANZ) + Commonwealth Bank of Australia (CBA) + Westpac Banking Corporation + St George Bank Limited + Bendigo Bank Limited + Bank of Western Australia Limited + HSBC Bank Australia Limited + Citigroup Ply Ltd + Bank of China + National Australia Bank Limited. Importantly, in each case the bank in question has been able to obtain a permit while respecting the rights of its employees in relation to work /life balance preferences and this has been done in consultation with the FSU. None of the big four banks (ANZ, CBA, NAB or Westpac [including StGeorge)) opens any where near all of its NSW branches on weekends despite having state-wide licenses to do so. In discussions with FSU each of these banks has indicated that they will only open where they see sufficient opportunity to generate additional business that justifies the cost of opening. Only a few branches currently open on weekends and this is clear evidence that there is no (or inadequate) consumer demand that would indicate a need for further de-regulation of bank opening hours and to do so would lead to negligible and unidentified benefits to the banks while seriously eroding the capacity for bank employees to have control over their working hours and their work /life balance. Another important fact that this review must take into account is that the overwhelming majority of bank branches are staffed by women who have family responsibilities. These same women often make significant voluntary contributions to their communities through faith groups, school and sporting connections and neighbourhood groups. This is a pertinent point in considering the public interest and community standards. Any further loss of control over working hours for these women would have detrimental societal impacts through stress on family relationships and loss of cohesion in the home. In 2008 the FSU challenged the granting of an unrestricted license to the Commonwealth Bank of Australia (CBA) in the Administrative Decisions Tribunal'. In this instance the CBA was initially granted an unrestricted license to open on weekends after previous restrictions that afforded protections to staff ensuring that work could only be undertaken on a voluntary basis were removed by the Director General of the Department of Commerce. In the Administrative Decisions Tribunal the FSU provided specific evidence about the terms and conditions of many CBA employees who were and still are on Australian Workplace Agreements (AWAs). These A WAs contained no provisions for voluntary work on a weekend and contained no provisions or penalty payments for overtime or weekend work. All of the A WAs also gave total control over rosters and working hours to the bank. The FSU also led evidence that demonstrated coercion by senior CBA managers seeking to force employees to work weekends against their will. 1 Finance Sector Union of Australia (NSW) v Director General, Department of Commerce (NSW) & Anor [2008] NSWADT 338-3 -
Under the current provisions of the Act, banks can potentially open the doors of all their NSW branches on 355 days of the year but most of them don't do so because it is not commercially necessary or viable. The test for a permit to open NSW bank branches on weekends as provided for in the Act is that of the public interest. There is no evidence that this test has led to a diminution of the availability of banks on weekends while there is ample evidence that the current arrangement serves the community well by ensuring that in seeking to open branches on weekends, our banks respect the public interest and pay due attention to the needs of their employees. The licensing regime should be preserved in its current form and the mechanism for review is an essential safety net that must be retained. Australian Banks do not need to change their hours to stay competitive or profitable. The four major banks are some of the most profitable banks in the world having reported a combined $22 Billion profit in 2010 and all reporting increased profit margins in 2011. The four major banks in Australia are widely considered to be some of the most successful financial institutions in the world. Today, banking customers, including businesses, conduct their banking in many different ways whether it is via a branch, an ATM, EFTPOS, phone banking or internet banking. Most importantly the practical reality is that almost all bank customers utilise other forms of banking on a regular basis. In 2011 banking services are available in NSW 24x7 and less than 10% of all banking transactions are now branch based; a proportion in long term decline. These details have been confirmed in recently conducted consultation about redundancies in transaction processing areas. 4. Given the August Bank Holiday is not a general public holiday should it remain a 'bank closed day'? The New South Wales Bank Holiday falls on the first Monday in August each year and is a closed day 'public holiday' for all banks in the state. The holiday is also observed by all other sectors of the finance industry and many non-finance businesses. This latter provision removes an inconsistency that had developed in recent years whereby certain financial institutions recognised the August Bank Holiday and others did not. The Terms of Reference of the Review at b) provides that the review should ensure there is no reduction to the current numbers of public holidays in NSW. The FSU places great weight upon this statement and in the first instance strongly asserts that the present "Bank Holiday" should be maintained in order to give effect to the Terms of Reference. To remove it would be contrary to the request and affected employees who enjoy the holiday would lose the benefit that has been a feature of the industry for over a century. The FSU strongly submits that the August Bank Holiday should be retained and there is no compelling case for its abolition. The FSU believes that if the state were to abandon the August Bank Holiday many workers in NSW would lose an entitlement that has existed for over 1 00 years. Given the Commonwealth's Fair Work Act and its focus on enterprise bargaining, there is no vehicle for compensating these employees for this loss on an industry wide basis. As previously addressed, the retail component of the banking sector is largely staffed by women who have pressing work and family obligations. FSU audits conducted over the years have indicated that unpaid overtime and stress -4-
related to the pressure to meet sales targets is endemic within retail bank branches. More than 50% of branch staff involved in the audit process in NSW indicated that they were expected to work unpaid overtime. FSU statistics indicate that disputes about hours of work are consistently among the top ten industrial problems experienced by union members in retail banking. The existence of the August Bank Holiday or 'close day' is a brief but important respite from the pressures of work in retail banking. In the report prepared by Professor Joellen Riley, "Public Holidays in NSW: Review of the Banks and Bank Holiday Act 1912': Professor Riley recommended that the August Bank Holiday should be retained as a close day, but with the ability for banks to seek exemptions on the day, with a mandatory requirement that workers who work on the day do so voluntarily. Professor Riley's recommendation has been adopted as amendments to the Act in 2011 and there is no obvious reason or compelling argument to suggest that the amendments require further change. With the newly legislated ability to apply for an exemption from the Bank Holiday in 2011, only one of the four major banks sought such an exemption. This can only indicate that the necessity of further change is neither sought nor required by the banking sector. The FSU strongly believes that the provisions relating to bank close hours as outlined in section Part 3A of the Act provide a good balance for the successful conduct of banking business in NSW and the protections of worker rights and do not need to be changed at this point in time. With changes to bank close days having been made less than one year ago it would be hasty for any government to make changes to such provisions now. This submission is made in light of the flexibilities already provided to banks to trade on weekends and public holidays and the underutilization by the banks and credit unions of the recent deregulation of the August Bank Holiday as an example. If you require any further information or clarification on any issues raised in this submission please do not hesitate to contact me in 02 9320 0005. Yours Sincerely, Geoff Derrick Secretary - 5-