Application by Michael Stephenson
[2022] FWC 995
| [2022] FWC 995 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.217—Enterprise agreement
Application by Michael Stephenson
(AG2021/8992)
| Timber and paper products industry | |
| COMMISSIONER BISSETT | MELBOURNE, 6 MAY 2022 |
Application for variation of the Dongwha Australia Enterprise Agreement 2019.
On 15 December 2021 Mr Michael Stephenson (Applicant) made an application to vary the Dongwha Australia Enterprise Agreement 2019[1] (Agreement) pursuant to s.217 of the Fair Work Act 2009 (FW Act) to remove ambiguity or uncertainty in the Agreement. In particular Mr Stephenson sought to vary the dispute resolution provisions of the Agreement.
The application was subject to conciliation before me but did not settle. I therefore issued directions for the filing of evidence and submissions from the parties. Mr John Rolph, who represented the Applicant, indicated that the Applicant relied on the application as his submissions and did not wish to file any evidence. The Applicant did file submissions in reply.
Ms Janet Gilbert of the Timber Trade Industrial Association and TTIA Legal, represented Dongwha Australia Pty Ltd (Respondent) with permission and filed submissions in opposition to the application.
The application and variation sought
The Applicant submits that the dispute settling procedure of the existing Agreement is uncertain. The dispute settling procedure is, for the purposes of this application, in the same terms as the model dispute resolution procedure contained in the Fair Work Regulations 2009 at Schedule 6.1.
The dispute resolution procedure is found at clause 11 of the Agreement. Clause 11.7 of the Agreement provides as follows:
11.7 The FWC may deal with the dispute in two stages:
(a)The FWC will first attempt to resolve the dispute as it considers appropriate, including by mediation, conciliation, expressing an opinion or making a recommendation; and
(b)If the FWC is unable to resolve the dispute at the first stage, the FWC may then:
i. arbitrate the dispute; and
ii. make a determination that is binding on the parties.
The Applicant says that clause 11.7(b) specifically contains uncertainty and therefore seeks to vary the clause to delete the current clause 11.7(b) and replace it with the following:
(b) Should the FWC establish that the parties are unable to agree in respect of the referred subject-matter of fact identified as the principal cause of and for the dispute between the parties under Sub-clause 11.7[a], the FWC shall declare the conciliation process concluded; and thereupon adjourn proceedings before the FWC to set down a date on notice to provide for any preparation for the outstanding subject-matter of fact of dispute between the parties to be considered and determined by process of arbitration by the FWC with any determination made in respect thereto to be binding on the parties.[2]
The Applicant does not say that there is any ambiguity in clause 11.7(b) of the Agreement.
For the reasons given below I am not satisfied that there is any ambiguity or uncertainty in clause 11.7(b) of the Agreement. I therefore do not have jurisdiction to vary the Agreement and the application is accordingly dismissed.
Background
It is necessary to set out, briefly, the background to this application as it explains the reasons for the application. I ensured, in hearing the application, that I properly understood this history.
On 16 June 2020 the Applicant made an application to the Fair Work Commission to deal with a dispute pursuant to s.739 of the FW Act and in accordance with the provisions of the dispute resolution procedure of the Agreement.[3] That dispute was allocated to Deputy President Dean to deal with.
The dispute arose from a decision of the Respondent to make some changes to employee working hours. The Applicant, in the proceedings before me, conceded that these changes were allowed under the Agreement. The Applicant sought compensation or payment of an allowance for the loss of pay occasioned by the alteration of hours. In the first instance the Applicant sought conciliation in relation to that claim. The dispute failed to settle in conciliation.
The Applicant then sought arbitration of the dispute. As has been explained in the course of these proceedings the Applicant sought, in that arbitration, that the Agreement be varied to provide the allowance or compensation it sought.
Ultimately the Deputy President’s Chambers wrote to the Applicant and Respondent on 24 September 2020 in response to correspondence from the Applicant.[4] That letter said:
Dear Parties,
C2020/4648 - Stephenson, Michael v Dongwha Australia Pty Ltd
We confirm receipt of the correspondence from Mr Rolph sent by facsimile after the conclusion of yesterday’s conference.
By way of background, the Deputy President notes this application has been the subject of three conferences before the Commission, and extensive communications between the parties and the Commission since the application was made in June. The relief sought by the application is as follows:
“That the Commission duly consider and determine in the circumstances as outlined hereunder, or otherwise as the Commission may find and deem fit and proper, the proposed Sub-clause variation petitioned for by a majority of Employees for the current Enterprise Agreement, as set out and published in draft form under the Applicant’s letter addressed and delivered to the Respondent Company dated the 6th April, 2020 and attached hereto in copy, subject to any formal process for approval in any respect thereof pursuant to the provisions therefore under Clause ‘6 – Variation of Agreement’ of the Enterprise Agreement.”
It was clear by yesterday’s conference that the matter would not be able to be resolved by way of a conciliated outcome, in that the Respondent did not agree to vary the applicable enterprise agreement to include a “shift work compensation allowance”, or otherwise make a payment to the Applicant’s that was in excess of its obligations under the applicable enterprise agreement.
As has been discussed extensively with the parties, the relief sought by the Applicants is not relief that can be obtained from an application made under s739 of the Act. The Applicant’s representative was invited to make a submission as to whether the dispute and relief sought could be reframed to enable the dispute to be arbitrated. After a lengthy discussion with the parties, it was evident that this was not the case.
Accordingly, the Deputy President expressed an opinion that the changes instituted by the Respondent with respect to the hours previously worked by the Applicants between 4am and 6am were changes open to it to make.
The Deputy President then indicated that the file should be closed, and the parties were given the opportunity to respond to this proposal.
Given the relief sought is not relief that can be provided, the matter is now concluded and the file will be closed.
Yours faithfully,
[name redacted]
Associate to Deputy President Dean
The file was subsequently closed by the Deputy President.
The current application
The Applicant’s submission, in short form, is that the failure of the dispute resolution procedure to allow for the arbitration of its claim in matter C2020/4648 evidences a degree of uncertainty in relation to the power of the Commission to arbitrate a dispute brought before the Commission and competently argued by both the Applicant and Respondent.
The Applicant submits that, having made the application to the Commission and it not having been settled at conciliation, the Respondent then argued that the word “may” in clause 11.7(b) effectively limited the power of the Commission to intervene and arbitrate “any specific subject matter of the industrial difference outstanding between the parties should either party effectively refuse to accept arbitration of the subject matter…”[5]
The Applicant further submits that if a dispute cannot be arbitrated because one party refuses to consent to arbitration then the dispute resolution procedure clause has no effective work to do. The Applicant says that this creates uncertainty and his proposed variation to the clause should be granted.
The Respondent, in its submissions, sets out in detail the relevant statutory provisions in relation to the requirements of a dispute settling procedure in an enterprise agreement, the provisions of s.739 of the FW Act in relation to the powers of the Commission to deal with a dispute, excerpts from the Fair Work Bill Explanatory Memorandum and a relevant excerpt from the Acts Interpretation Act 1901 (s.33).[6] I do not repeat those here.
The Respondent submits that the Applicant’s submissions that the arbitration did not proceed because it argued the word “may” in clause 11.7(b) of the Agreement did not give the Commission power to arbitrate without its consent to such arbitration are clearly wrong. This is evidence by the letter from the Associate to Deputy President Dean (referenced above).
Further, the Respondent submits that it cannot be that the dispute resolution procedure, reflecting the model dispute resolution procedure could be ambiguous or uncertain. The Respondent submits that it is included in a multitude of agreements and has been in the predecessor agreements applying at the Respondent with no issue.
The Respondent also submits that an inability of the Commission to arbitrate the dispute as sought by the Applicant is not grounds on which to find ambiguity or uncertainty in clause 11.7(b) of the dispute resolution procedure of the Agreement.
Dealing with ambiguity or uncertainty
Section 217 of the FW Act provides as follows:
217 Variation of an enterprise agreement to remove an ambiguity or uncertainty
(1)The FWC may vary an enterprise agreement to remove an ambiguity or uncertainty on application by any of the following:
(a) one or more of the employers covered by the agreement;
(b) an employee covered by the agreement;
(c) an employee organisation covered by the agreement.
(2)If the FWC varies the enterprise agreement, the variation operates from the day specified in the decision to vary the agreement.
In Application by Presbyterian Ladies College[7] I stated that:
[13] A decision to vary an agreement to remove ambiguity or uncertainty is a discretionary decision. Prior to considering if an agreement should be so varied it is necessary to identify the ambiguity or uncertainty.
[14] Such an identification involves an objective assessment of the words used – construed having regard to their context. Context is not confined to the specific words used but may involve a consideration of a number of clauses within an agreement.
[15] In deciding if ambiguity or uncertainty exist “the Commission would generally err on the side of finding an ambiguity or uncertainty in circumstances where there are rival contentions advanced before it and an arguable case can be made out for more than one contention.”[8] However, it is not enough that rival contentions can be found or that the clause is disputed. There must be an objective judgement as to whether the wording is susceptible to more than one meaning.[9]
[16] Having determined that ambiguity or uncertainty exists it is a matter of discretion as to whether the agreement should be varied. In exercising such discretion the Commission should have regard to the mutual intention of the parties at the time the agreement was made.[10]
I have relied on the approach outlined above in the application before me.
Identification of uncertainty
The Applicant says there is uncertainty in clause 11.7(b) of the dispute resolution procedure of the Agreement.
Beyond not being able to have arbitrated a variation to the Agreement, the Applicant puts no evidence before the Commission that suggests any uncertainty in the words of clause 11.7(b) of the Agreement. As was said in Bradnam’s Widows and Doors Pty Ltd[11] “the process of identifying…uncertainty involves making an objective assessment of the words used in the provisions under examination. The words used are construed having regard to their context” and that “[t]he mere existence of rival contentions as to the proper construction of the terms of an agreement will also be an insufficient basis to conclude the existence of ambiguity or uncertainty. Such contentions may be self-serving. The task is to make an objective judgment as to whether the wording of a provision is susceptible to more than one meaning”.[12]
The Applicant has put nothing to the Commission that would enable me to conclude that there is any uncertainty in clause 11.7(b) of the dispute resolution procedure of the Agreement.
The basis of the claim of uncertainty – the non-arbitration of the claim for the inclusions of a claim for compensation/allowance in the Agreement – was caused not by any uncertainty in the dispute resolution procedure but by the limitations of the FW Act itself, perhaps not properly understood by the Applicant.
The Commission does not have the power to vary an enterprise agreement by arbitration except in quite limited circumstances.
The power to vary an enterprise agreement is set out in Part 2-4 Division 7 of the FW Act. An application can be made to the Commission once a variation has been agreed to by employees on request of an employer. An application to vary the agreement must then be made to the Commission with s.211 of the FW Act setting out when the Commission must approve such a variation. I would observe that this process – except that it varies an existing agreement – reflects the process generally of making an agreement and having that agreement approved by the Commission. The matter before me (and that in the dispute notified by the Applicant in matter C2020/4648) is not such an application.
Should a party propose a variation an employer, employee or employee organisation can apply to the Commission to deal with a dispute about the variation, but the Commission must not arbitrate that dispute (s.217A of the FW Act).
Otherwise, a variation may be sought to remove ambiguity or uncertainty (s.217 of the FW Act) or on referral of the Human Rights Commission (s.218 of the FW Act).
The application before me seeks to have the dispute resolution procedure of the Agreement varied. The Applicant seeks to do so apparently so that he may further attempt to have arbitrated what he previously sought to, but was unsuccessful in having, arbitrated. An application to remove ambiguity or uncertainty is not a means by which a variation to an agreement that is not otherwise within the Commission’s powers can be achieved.
Whilst I acknowledge the frustration of the Applicant with the limitations that he may see in the operation of the FW Act this does not, objectively, lead to a conclusion that the wording of clause 11.7(b) of the Agreement is uncertain. I would observe that the Applicant, beyond frustration, has not demonstrated that there is uncertainty with the provisions of the dispute resolution procedure as it stands.
For these reasons I am unable to find ambiguity or uncertainty in clause 11.7(b) of the Agreement. Given I cannot make such a finding on the evidence before me I therefore do not have jurisdiction to vary the Agreement.
The application is therefore dismissed.
COMMISSIONER
Appearances:
J. Rolph, for the Applicant.
J. Gilbert, for the Respondent.
Hearing details:
2022.
Melbourne by Teams Video
April 29.
[1] AE505053
[2] See item 2.1 in the application (Form F1)
[3] C2020/4648 Stephenson v Dongwha Australia Pty Ltd
[4] Exhibit R1
[5] Applicant’s submissions in reply 20 April 2022 paragraph 4
[6] Respondent’s submissions 5 April 2022 paragraph 3
[7] Application by Presbyterian Ladies College [2021] FWCA 1389
[8] The Public Transport Corporation of Victoria and Australian Rail, Tram and Bus Industry union and others Print M2454 as cited in Re Construction, Forestry, Mining and Energy Union Print R2431 at [13]
[9] SJ Higgins Pty Ltd v Construction, Forestry, Mining and Energy Union PR903843 at [7]
[10] See Tenix Defence Pty Limited PR917548 at [28]-[32] and the cases cited therein
[11] [2019] FWCA 979
[12] See Re Civil Construction Corporation Enterprise Agreement PR939346; SJ Higgins Pty Ltd and Others v CFMEU (PR903843); Re CFMEU Appeal Print R2431
Printed by authority of the Commonwealth Government Printer
<AE505053 PR741132>
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