WATER CORPORATION MIDWEST REGION LOCAL AGREEMENT 1998
No. AG 190 of 1998 2 3
CLAUSE 1 TITLE
This Agreement shall be known as the Water Corporation Midwest Region Local Agreement 1998, and is to be read in conjunction with the Water Corporation Conditions Agreement 1997 and the Water Corporation Pay and Allowances Agreement 1997, which contains the other conditions of employment not specified in this Agreement.
CLAUSE 2 ARRANGEMENT
CLAUSE 1 TITLE...... 1
CLAUSE 2 ARRANGEMENT...... 1
CLAUSE 3 PARTIES BOUND...... 1
CLAUSE 4 PRECEDENCE OVER AGREEMENTS...... 2
CLAUSE 5 TERM OF AGREEMENT...... 2
CLAUSE 6 NO FURTHER CLAIMS...... 2
CLAUSE 7 DEFINITIONS...... 2
CLAUSE 8 MISSION AND OBJECTIVES...... 3
CLAUSE 9 CRITICAL SUCCESS FACTORS...... 3
CLAUSE 10 PERFORMANCE MEASURES AND TARGETS...... 5
CLAUSE 11 STRATEGIES...... 7
CLAUSE 12 LOCAL ARRANGEMENTS...... 9
CLAUSE 13 PERFORMANCE MONITORING...... 9
CLAUSE 14 DISPUTE RESOLUTION PROCEDURE ...... 9
CLAUSE 15 INCENTIVE DISTRIBUTION...... 9
CLAUSE 16 SIGNATORIES...... 10
APPENDIX 1 PERFORMANCE INDICATORS ...... 12
APPENDIX 2 INCENTIVE DISTRIBUTION GUIDELINES...... 13
APPENDIX 3 MID WEST REGION RESULTS REPORT ...... 14 4
CLAUSE 3 PARTIES BOUND
This Agreement applies to and binds the Corporation, all persons (except those in managerial positions who are or become parties to common law contracts) who are employees of the Corporation's Midwest Region during the operation of this Agreement and also applies to and binds the following organisations:
THE AUSTRALIAN WORKERS UNION, (AWU)
CIVIL SERVICE ASSOCIATION OF WESTERN AUSTRALIA (INC) (CSA)
AUTOMOTIVE, FOOD, METALS, ENGINEERING, PRINTING AND KINDRED INDUSTRIES UNION OF WORKERS, WESTERN AUSTRALIAN BRANCH (AMWU)
COMMUNICATIONS, ELECTRICAL, ELECTRONIC, ENERGY, INFORMATION, POSTAL, PLUMBING AND ALLIED WORKERS UNION OF AUSTRALIA, ENGINEERING & ELECTRICAL DIVISION, WESTERN AUSTRALIAN BRANCH (CEPU)
This Agreement will cover an estimated 110 employees at the date of registration.
CLAUSE 4 PRECEDENCE OVER AGREEMENTS
Where the terms of a registered/certified agreement covering employees covered by this Agreement are inconsistent with the terms of this Agreement, this Agreement shall prevail to the extent of any such inconsistency. The relevant agreements are:
the Water Corporation Pay and Allowances Agreement 1997 the Water Corporation Conditions Agreement 1997
CLAUSE 5 TERM OF AGREEMENT
Unless otherwise agreed this Agreement shall operate from 1 July 1998 until 30 June 1999. It may operate for a further period up to 30 June 2000 under the following conditions:
(a) it has the approval of the Local Area General Manager, and
(b) the potential Corporate and Local Area incentive payments for the 1999/2000 financial year are identified and communicated to employees, and
(c) agreement is reached between the parties to any variations including performance monitoring and strategies and Local Arrangements for the 1999/2000 financial year, and
(d) ballots will be conducted by the relevant parties to the Agreement.
CLAUSE 6 NO FURTHER CLAIMS 5
The parties to this Agreement undertake that for the duration of this Agreement there shall be no further pay increases sought or granted, except for those provided under the terms of this Agreement and those under the terms of the Water Corporation Conditions Agreement 1997, the Water Corporation Pay and Allowances Agreement 1997, or provided for in a National or State Wage Case Decision.
CLAUSE 7 DEFINITIONS
"Agreement" means the Water Corporation Midwest Region Local Agreement 1998.
"Corporation" means the Water Corporation established under Section Four of the Water Corporation Act 1995. 6
CLAUSE 8 MISSION AND OBJECTIVES
1) The Water Corporation’s Vision is to be recognised as an excellent customer oriented service organisation and a world class manager of water and wastewater services.
2) The Midwest Region’s Mission is to:
To be a successful business providing quality water-related services to customers to enhance their lifestyle and to support the future development of the Midwest Region.
3) Our Objectives are to:
Provide exceptional customer service
Achieve superior commercial performance
Deliver business development and growth
Demonstrate sound environmental management
Comply with statutory and regulatory requirements
Manage our assets responsibly
Maintain a safe and healthy work environment
Retain motivated and skilled employees
Manage within the framework of regional values
4) These objectives support the Water Corporation’s Key Result Areas of:
Excellence in Customer Service Superior Financial Performance Business Development and Growth Effective Environmental Performance
CLAUSE 9 CRITICAL SUCCESS FACTORS
1) Critical Success Factors
The following Critical Success Factors have been identified for the Water Corporation and shall be adopted by the Midwest Region:
External Focus 7
We are driven by our need to satisfy the demands of our external environment. We actively search our environment for information to enable us to generate and take full advantage of opportunities, minimise and competently manage threats, please our current and potential customers and stay ahead of our competitors. We strive to assist and support our customers as our first priority in business, and recognise them as the source of our employment.
Speed We will be characterised by speed in everything we do. Our opportunities will be measured by hours and days rather than months and years. Our customers will not wait if we cannot respond or deliver, but will use a competitor, or an alternative product or service. Our business success will depend on our ability to become faster and more efficient in developing responses to customers’ needs, making business decisions and implementing them.
Flexibility We will be characterised by the ability to deliver on customer requirements in a time, place and manner agreed with the customer. We will only use systems and processes which support our ability to deliver upon our customers’ requirements. We will train, empower and reward each other to foster our ability to deliver.
Integration We will be characterised by our ability to coordinate our activities with other business units of the Water Corporation. All strategies and initiatives developed by the Midwest Region are integrated with each other and that of other business units. We constantly communicate simply and effectively with people inside and outside the Region.
Innovation We will maintain a competitive advantage by seizing innovation to deliver greater advantage to our customers. We see all changes as an opportunity to innovate and deliver greater value. We are recognised by our customers as a highly innovative and useful business unit, and are sought out for our ability to solve our customers’ problems.
In addition to the above, the Region has also recognised the need to apply the following critical success factor to the business environment in which it operates:
Commercial Focus The Midwest Region will operate on a commercial basis. We will demonstrate sound business management and ensure that our focus at every level is on performance (results) and not effort or activity. We will seek productivity improvements. Our financial outcomes will be developed against a “desired state” commercial balance sheet and profit and loss account with an emphasis on asset performance and business net worth.
2) Values
The Midwest Region is committed to the following values which define what is important and shape the way in which we will meet the challenges of a competitive environment:
We are a professional team. We treat each other with trust and respect. 8
We hold that every employee is entitled to a healthy, safe and satisfying work environment.
We believe quality decisions are based on measurement and fact.
We foster open communication through honest and fair dealings with our customers, suppliers and each other. We provide accurate and timely information through regular consultation and feedback.
We recognise that we are all customers and suppliers to those with whom we work. We have a right to expect good work from others and an obligation to contribute quality work.
We encourage initiative and support individuals in making decisions in their work area.
We value each others efforts and skills and recognise the contribution each makes to the achievement of our business goals. Our future depends on fostering self- improvement through continued learning.
We recognise and value the role families play in the general well being of our employees.
We value our integrity and conduct our business in a manner that is socially and ethically responsible.
The above regional values support the Water Corporation’s values of:
Satisfy our customers Respect people Always do better Act with integrity Respect the environment
CLAUSE 10 PERFORMANCE MEASURES AND TARGETS
1) The performance indicators, measures and targets outlined in Table 1 below prescribe the basis on which this Agreement will be evaluated.
2) The first four indicators have been established to reflect progress against the Corporation’s Key Result Areas.
Key Result Areas Performance Indicator Excellence in Customer Service - Customer Satisfaction Superior Financial Performance - Financial Performance Business Development and Growth - Business Development Effective Environmental Performance - Environmental Performance 9
3) The final indicator, “Safety Performance” enables the Region to assess its progress against the Corporation’s Key Support Area of “People”.
4) Appendix 1 of this Agreement prescribes guidelines on the selection, sourcing and calculation of the performance indicators.
5) In the event of a change in circumstances which is likely to have a significant negative or positive impact on the ability of the Midwest Region to achieve a target contained in this clause, the parties shall confer to consider whether the measure and/or target should be changed or deleted and whether the relative weightings should be reviewed.
6) Strategies for achieving the performance measures and targets contained in this clause are prescribed in Clause 11, Strategies.
7) Appendix 3 of this Agreement describes the Midwest Region Results Report. 10
Table 1: Performance Indicators, Measures and Targets
INDICATOR MEASURE CURRENT YEAR 1 YEAR 1 YEAR 1 WEIGHTIN PERFORMAN CAP TARGET THRESHO G CE LD (Baseline) Customer Satisfaction) Customer Contact Surveys (%) % % % % 20%
Financial Performance) Performance v Budget Expenditure x 100 97.4% 99% 100% 100% 20% Budget 1
Business Development Annualised value of diversified business income $100k $250k $200k $150k 20% ($)
Environmental Water use efficiency Performance Total water consumed x 100 85.7% 90% 89% 87% 20% = % Total water taken 1
Safety Performance Worksafe Audit (%) 48.9% 70% 67% 65% 20% 11
CLAUSE 11 STRATEGIES
The following tables outline the strategies and activities the Midwest Region will undertake to support the achievement of the performance measures and targets prescribed in Clause 10, Performance Measures and Targets.
Table 2:
PERFORMANCE INDICATOR: CUSTOMER SATISFACTION Strategy Actions / Milestones Target Dates 1. Understand our customers 1. Influence the market segments surveyed On-going quarterly (inclusion of major consumers, accounts managed etc) Quarterly 2. Analyse quarterly customer contact survey results (focus on exceptions) as required 3. Review processes, products/services and as required develop solutions 4. Initiate improvement activities
2. Inprove delivery of service 1. Acquire and train personnel in systems and On-going and products processes Sept 1998 2. Plan and implement Account Management On-going 3. Undertake proactive promotion/information of services and products provided Dec 1998 4. Manage interfacing of internal activities
Table 3:
PERFORMANCE INDICATOR: FINANCIAL PERFORMANCE Strategy Actions / Milestones Target Dates 1. Develop best practice for 1. Complete Operations and Maintenance July 1998 Operations and plans. July 1998 Maintenance activities. 2. Develop resource plans / requirements for effective delivery of plans.
2. Improve the real total cost 1. Review energy management practices (eg. Sept 1998 per service pumping strategies) for each scheme. 2. Critically review variable overhead costs. Sept 1998 3. Implement requirement for managers to Sept 1998 review and report monthly on exceptions. 4. Develop process for recognising and July 1998 claiming expenses for insurance items. 5. Dispose of unwanted assets to reduce June 1999 12
PERFORMANCE INDICATOR: FINANCIAL PERFORMANCE Strategy Actions / Milestones Target Dates unnecessary maintenance cost.
3. Grow the revenue 1. Develop regional meter replacement Sept 1998 programme in conjunction with corporate initiative. Sept 1998 2. Increase property income and have it recognised regionally. July 1998 3. Review process for notifying customers on availability of new services. 13
Table 4:
PERFORMANCE INDICATOR: BUSINESS DEVELOPMENT Strategy Actions / Milestones Target Dates 1. Establish business 1. Develop Business Development Plan Aug 1998 development framework 2. Develop systems and processes Oct 1998 3. Acquire and train necessary resources Dec 1998
2. Establish new business 1. Consultancy / Project Management ASAP contracts 2. Operations and Maintenane Contracts ASAP 3. Land disposal / development ASAP 4. New products / service ASAP
3. Create new business 1. Promote innovation on-going opportunities 2. Develop business plans for innovation on-going proposals on-going 3. Undertake R & D and trials
Table 5:
PERFORMANCE INDICATOR: ENVIRONMENTAL PERFORMANCE Strategy Actions / Milestones Target Dates 1. Reduce losses 1. Ensure accurate master meters and on-going calibration on-going 2. Identify and eliminate leaks/overflows/theft on-going 3. Replace inaccurate consumption (customer) meters
2. Increase reuse 1. Find more effluent reuse customers on-going 2. Negotiate increases in existing customers’ on-going volumetric requirements 3. Develop other beneficial disposal methods on-going for wastewater
3. Increase reclaim 1. Initiate backwash recovery as required 2. Continue Infill Sewerage Program on-going
Table 6:
PERFORMANCE INDICATOR: SAFETY PERFORMANCE Strategy Actions / Milestones Target Dates 1. Implement Regional 1. Develop and implement worksafe on-going Worksafe Plan procedures and instructions for hazardous 14
PERFORMANCE INDICATOR: SAFETY PERFORMANCE Strategy Actions / Milestones Target Dates tasks as required 2. Deliver training in accordance with training on-going program May 1999 3. Maintain safety records for assessment purposes 4. Arrange Worksafe Audit 15
CLAUSE 12 LOCAL ARRANGEMENTS
1) The Parties to this Agreement undertake to explore work issues with a view to implementing mutually acceptable local arrangements during the life of this Agreement which enable the Midwest Region to achieve its stated business objectives .
2) Each proposal will be treated on its merit in relation to the business case presented. Changes to local working arrangements will be under the provisions of the Water Corporation Conditions Agreement 1997 and should be designed to enhance service to customers, assist in achieving targets, and be consistent with business objectives, critical success factors and values.
CLAUSE 13 PERFORMANCE MONITORING
1) The Midwest Region shall monitor its performance against the targets established in Clause 10, Performance Measures and Targets. It will also monitor the progress of the strategies and actions set down in Clause 11, Strategies.
2) Performance shall be calculated using the measurement criteria and information sources established for the indicators in Clause 10, Performance Measures and Targets.
3) A responsible officer(s), designated by the Regional Manager, Midwest Region, shall ensure that performance data is collected and reported as required. Performance results shall be distributed to workplace teams on a regular basis (at least quarterly).
4) Regional employees and the relevant unions shall have access to a copy of this Agreement and any documents relating to performance monitoring.
CLAUSE 14 DISPUTE RESOLUTION PROCEDURE
Parties to this Agreement will apply the Dispute Resolution Procedure prescribed in the Water Corporation Conditions Agreement 1997, Clause 5.6, Dispute Resolution Procedure.
CLAUSE 15 INCENTIVE DISTRIBUTION
1) Clause 3.11, Lump Sum And Incentive Payments, of the Water Corporation Conditions Agreement 1997, describes the performance linked incentive scheme available to Corporation employees for the 1998/99 and 1999/2000 financial years. 16
2) The incentive payment to Midwest Region employees covered by this Agreement shall distributed equally among the employees of the Region in proportion to the amount of ordinary time worked during the term of this Agreement.
3) Appendix 2 of this Agreement prescribes guidelines on employee entitlement to performance linked incentive payment. 17
CLAUSE 16 SIGNATORIES
Signed for and on behalf of the Water Corporation
..Signed...... ACTING CHIEF EXECUTIVE OFFICER
Dated: 22/7/98
General Secretary, Civil Service Association of Western Australia Incorporated.
...Signed...... Com mon Seal
Dated: 23/7/98
Signed for and on behalf of the Australian Workers Union.
....Signed......
Dated: 24/7/98
Signed for and on behalf of the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union of Workers, Western Australian Branch.
...Signed...... Common Seal..
Dated: 16/9/98
Signed for and on behalf of the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Workers Union of Australia, Engineering & Electrical Division, Western Australian Branch.
...Signed...... Common Seal..
Dated: 17/9/98 18
APPENDIX 1 PERFORMANCE INDICATORS
The following guidelines will apply to the calculation of the Region’s Local Agreement performance indicators: a) Customer Satisfaction
Measured by using customer contact surveys conducted quarterly. The baseline for this Agreement will be established from the May 1998 survey results.
Targets shall be calculated in accordance with following agreed formula for the Customer Service Division: The threshold will be the baseline score as at May 98 The target will be baseline plus 7% (if baseline is 60) baseline plus 6% (if baseline is 61 to 70) baseline plus 5% (if baseline is 71 to 80) baseline plus 3% (if baseline is 81 to 90) baseline plus 1% (if baseline is 90) The cap will be baseline plus 8% (if baseline is 60) baseline plus 7% (if baseline is 61 to 70) baseline plus 6% (if baseline is 71 to 80) baseline plus 4% (if baseline is 81 to 90) baseline plus 1% (if baseline is 90)
The Region’s performance shall be measured by the percentage above the baseline as at May 1999, based on the sum of positive responses and determined by an aggregate of the questions appropriate to the Region’s “areas of influence”. b) Financial Performance
Measure is defined as “the total of operating, support and reimbursement expenditure, less reimbursement revenue, compared to the corresponding approved budget”. Baseline performance is derived from Likely-End-Of-Year (LEOY) outlook for 1997/98. The General Ledger will be used for sourcing performance data and the regional Contribution Statement for calculating performance.
Excluded from this measure are the following: new initiatives the effect of a material accounting changes on the measured amounts imposed on the region and not allowed for in the approved budget (eg. a change in accounting capitalisation rules whereby more expenses are charged to operational and not to capital) costs attributed to significant abnormal or unforseen major incidents of an operational nature (eg. failure of a major asset) expenditure on power and alarm lines
All exclusions are to be determined at the end of the period of this Agreement, based on the documented evidence and agreed by the General Manager. 19 c) Business Development
To be measured by the level of income generated (actual or accrued) from diversified business over the 1998/99 financial year.. Diversified business income for the purpose of this indicator relates to income derived by the Region from activities which include, but is not limited to, the following: operations & maintenance contracts for “other” schemes, external consultancy, special agreements (eg. effluent reuse), property and facilities leasing (eg. rents and hire), miscellaneous revenue. d) Environmental Performance
Water use efficiency measures the efficient use of water consumed as a percentage of total water taken from the natural environment (eg. borefields, dams, desalination). Water usage is measured as the total volume of water consumed (TWC). It includes potable and non-potable water, effluent etc sold/delivered to customers/consumers by agreement (implied or explicit). The measure demonstrates to our regulator (the Waters & Rivers Commission) our responsibility as an environmental manager. Reflects on the positive contribution of the region to water use efficiency. Source(s) of data include the relevant annual Grange Management Report (consumption data), and services provided by agreement and PC-based water production data. e) Safety Performance
Safety in the region will be measured using the WorkSafe Plan tool as a comprehensive approach to the assessment of the Region’s Occupational Safety and Health management system. It will be used to assess the region’s Occupational Safety and Health performance in five key elements. The Region has targeted the “Silver Certificate of Achievement” for a satisfactory performance, which requires a rating of between 60% to 84% in all key elements. Baseline established from August 1997 Worksafe Audit. An independent Worksafe Audit to be conducted in May 1999 will assess the Region’s level of compliance/performance. 20
APPENDIX 2 INCENTIVE DISTRIBUTION GUIDELINES
The following guidelines will apply to employee entitlement to incentive payments: a) Employees engaged full time during the full term of this Agreement are entitled to a full share of the incentive payment earned. b) Employees engaged part time during the full term of this Agreement shall be entitled to a share based on time worked in proportion to full time. c) Employees who start or finish during the term of this Agreement shall be entitled to a share based on time worked in proportion to full time. d) Employees absent from duty on leave without pay, parental leave or secondment to an external agency, shall have the period of absence deducted from service over the term of this Agreement. Service will only be deducted when the period of absence is continuous and is in excess of 3 months. e) Categories not entitled to incentive payments: Corporation employees on contract as defined in Clause 3, Parties Bound of the Agreement Persons working under a contract for service (eg. an agency) Vacational (student) employees Employees of other organisations seconded into the Corporation. 21
APPENDIX 3 MIDWEST REGION RESULTS REPORT
Local Performance Measures Corporate Performance Measures
Customer Financial Business Environ Safety Customer Financial Business Environ Satisfacti Performa Developm ment Performa Excellence Performa Developm ment on nce ent nce nce ent
Customer Expenditu Value of Water use Worksafe Overall Satisfactio EBIT plus Diversifie Satisfactio satisfactio re versus diversified efficiency Audit customer n of Developer d revenue n with n Budget business performan satisfactio “Work s’ (excluding environme income ce n with Me” Contributi asset ntal business on sales) performan segment ce
Long Term Target 90% 100% $1M 96.2% 85%
Cap = % 99% $250k 90% 70%
Year One Target = % 100% $200k 89% 67% 85% 65% $459M $57M 80%
Threshold = % 100% $150k 87% 65% 83% 50% $407M $50M 72.5%
Baseline % 97.4% $100k 85.7% 48.9% Performance
Year One Performance
Achievement (0% - 110%)
Weighting 20% 20% 20% 20% 20% 15% 10% 25% 25% 25% 22
TOTAL Achievement
Total Score for Local Area = Maximum Local Area Incentive =
Local Area Component of Incentive Payment =
Total Incentive for Local Area = 23
V A R I A T I O N R E C O R D
WATER CORPORATION MIDWEST REGION LOCAL AGREEMENT 1998
NO. AG 190 of 1998
Delivered 04/12/98 at 78 WAIG 4804 Registered as at 29/10/98 Consolidated
CLAUSE EXTENT OF ORDER OPERATIVE GAZETTE NO. VARIATION NO. DATE REFERENCE
1 TITLE 2 ARRANGEMENT 3 PARTIES BOUND 4 PRECEDENCE OVER AGREEMENTS 5 TERM OF AGREEMENT 6 NO FURTHER CLAIMS 7 DEFINITIONS 8 MISSION AND OBJECTIVES 9 CRITICAL SUCCESS FACTORS 10 PERFORMANCE MEASURES AND TARGETS 11 STRATEGIES 12 LOCAL ARRANGEMENTS 13 PERFORMANCE MONITORING 14 DISPUTE RESOLUTION PROCEDURE 15 INCENTIVE DISTRIBUTION 16 SIGNATORIES APPENDIX 1 PERFORMANCE INDICATORS APPENDIX 2 INCENTIVE DISTRIBUTION GUIDELINES APPENDIX 3 MID WEST REGION RESULTS REPORT