Australian Aircrew Officers Association v Cathay Pacific Airways Limited

[2019] FWC 101

[2019] FWC 101

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s 739 - Application to deal with a dispute

Australian Aircrew Officers Association
v
Cathay Pacific Airways Limited
(C2018/3252)

Airline operations
DEPUTY PRESIDENT SAMS	SYDNEY, 10 JANUARY 2019

Application to have the Commission deal with a dispute under an enterprise agreement – Cathay Pacific airline pilots – dispute concerning E-Learning in own time and claim for payment – whether grievance processed according to steps in the Grievance Procedure – timelines in the procedure not met – whether consent to extend timelines in the procedure unreasonably withheld – jurisdictional objection – error in relevant clause – obvious error produces absurd outcomes – delay in filing grievance significant – withholding of consent not unreasonable – steps in procedure not followed – Commission has no jurisdiction to deal with dispute – application dismissed.

[1] On 14 June 2018, the Australian Aircrew Officers Association (‘the Association’) filed an application under s 739 of the Fair Work Act 2009 (‘the Act’), seeking to have the Fair Work Commission (‘the Commission’) deal with a dispute according to the Dispute Settlement Procedure (‘DSP’) in the Cathay Pacific Airways Limited Australian Based Air Crew Enterprise Agreement 2016 (‘the Agreement’) [AE417657]. The dispute concerns the interpretation of the E-Learning clause in the Agreement which reads at cl 11.2:

‘11.2 E-Learning

11.2.1 The first two (2.0) hours of E-Learning per year will attract no credit. Thereafter payment will be at full value of the actual stated module completion time. Such payments will be at full value of the actual stated module completion time. Such payments will be paid but not credited and will be made in January for the previous year. In the event that modules exceed a total of four (4) hours in any year, then the Company agrees to review this formula.

11.2.2 For the purposes of payment in schedule 11.2.1, an Officers hourly rate will be calculated as Annual Salary plus HDP divided by one thousand and eight (1008). Payment will then be made as a proportion of the hourly rate (e.g. if the Officers hourly rate is $100 per hour and the annual module completion time totals 2.5 hours, $50 would be payable to that Officer).

11.2.3 E-Learning modules are those specified as such by GMF.’

[2] The relief sought by the Association explains the interpretation of cl 11.2 as pressed by it as follows:

‘1. The Applicant seeks an Order and/or Decision to the effect that:

(a) E-Learning as contemplated by clause 11.2 of the Agreement means training or learning required or directed by the Respondent to be undertaken by an employee which may be done remotely at home, in an officer's own time, using computer equipment;

(b) when requiring or directing an employee to undertake training in their own time that will not, in the Respondent’s view, be covered by clause 11.2, the Respondent will advise the employee prior to the training being undertaken in writing;

(c) where E-Learning has been undertaken by an employee related to their employment as required or directed by the Respondent, it will be paid by the Respondent in accordance with clause 11.2.1; and

(d) any other order that the Commission sees fit.’

[3] Cathay Pacific Airways (‘Cathay’) does not agree with the Association’s interpretation. However, for reasons which will become clear shortly, it is unnecessary for the Commission to resolve the substantive dispute by this decision. In accordance with my usual practice the dispute was listed for a conference on 25 June 2018; later relisted by consent to 3 August 2018. The conference did not resolve the matter and as a result of a jurisdictional objection taken by Cathay, I listed the matter for hearing on the preliminary issue and issued associated directions.

[4] The Association has been on notice since 15 May 2018, that the Grievance to which clause 11.2 related, had been filed by a Captain Gavin Haselmore, outside the grievance timelines set out in cl 23 of the Agreement. It is fair to say that cl 23 sets out a detailed and highly prescriptive set of conditions in respect to filing a grievance and strict timelines as to its processing, subject to cl 23.1.6 which reads:

‘The Parties will adhere to all timelines in this Section 23 Grievances, to ensure that matters are dealt with in a timely and effective manner. There may, however, be occasions when these timelines need to be extended. Such extensions will be by mutual agreement of both Parties and the consent for an extension will not be unreasonably withheld.’

[5] Cathay relies on cl 23.2.4 and 23.2.5 which provide:

‘23.2.4 Prior to filing a grievance the Grievor must discuss their complaint with the appropriate department Manager or his designated representative.

23.2.5 If, after completing Section 23.2.1, the Grievor is not satisfied with the outcome of the initial complaint, the Grievor may file a grievance with the Chief Pilot within twenty (20) days of the Grievor reasonably having knowledge of the occurrence or the facts giving rise to the grievance.’

[6] It is common ground that the 20 day timeline above has not been met. Cathay maintained the grievance was invalid and could not succeed as it would not consent to an extension of the timeline as contemplated by cl 23.1.6. At this juncture, I would observe that I have never come across a more prescriptive set of mandatory requirements for processing an employee’s grievance, including then taking it to the Commission under the DSP at cl 24 of the Agreement. That said, I must assume the parties intended such a process would apply and agreed upon it. However, I hazard a guess that they could not have predicted that one simple oversight in timing, might invalidate the whole process and leave a legitimate dispute unresolved, and without any recourse for resolution. So be it. The Commission is always bound by the provisions of s 739(5) of the Act; namely that the ‘Commission must not make a decision that is inconsistent with this Act or a fair work instrument that applies to the parties.’

[7] At the jurisdictional hearing Mr J Kennedy, Solicitor, Hall Payne Lawyers, appeared for the Association and Mr D Perry, Solicitor, Seyfarth Shaw Australia with Ms S Megson appeared for Cathay, with both parties granted permission to be represented by a lawyer pursuant to s 596 of the Act.

THE EVIDENCE

[8] It is necessary for the purposes of this decision to set out the full text of cl 23 of the Agreement:

‘23. GRIEVANCE

23.1. General Principles

23.1.1. All grievance procedures and actions will:

23.1.1.1. Follow due process and allow each party a fair and adequate opportunity to present their case.

23.1.1.2. Follow the principles of common sense, procedural fairness and natural justice.

23.1.1.3. Be conducted in a timely and expeditious manner.

23.1.2. Grievance procedures may be initiated by:

23.1.2.1. an individual Officer, or

23.1.2.2. a group of Officers who have a common grievance and who desire to have the common grievance heard as a single case, or

23.1.2.3. an EBR as nominated in accordance with Section 1.8.2 of this Agreement on behalf of an individual Officer nominee, or

23.1.2.4. the Association on behalf of a group, all of its members, or on its own behalf.

23.1.3. The party initiating the grievance in accordance with Section 23.1.2 of this Agreement will be known as the Grievor.

23.1.4. The Grievor and the Company may, by mutual agreement in writing, elect to waive or combine any or all steps in this Section 23 Grievances.

23.1.5. Any reference to days will be exclusive of Saturdays, Sundays and public holidays in Hong Kong and Australia.

23.1.6. The Parties will adhere to all timelines in this Section 23 Grievances, to ensure that matters are dealt with in a timely and effective manner. There may, however, be occasions when these timelines need to be extended. Such extensions will be by mutual agreement of both Parties and the consent for an extension will not be unreasonably withheld.

23.1.7. Grievance Hearings and Appeal Hearings will be held in Hong Kong or, at the Company's discretion, Australia.

23.1.8. An Officer will be given time free from Duty to accommodate attendance at hearings. Where the hearing is held outside an Officer's Home Base, and not in conjunction with the Officer's rostered duties, the Company will provide transportation and accommodation in accordance with the Duty Travel Policy from his Home Base and return.

23.2. Filing Process

23.2.1. Any dispute the Association has with the Company regarding the operation or interpretation of the Memorandum of Understanding for the Recognition of the Australian Aircrew Officer's Association dated 01 January 2016, or as replaced, will commence at Stage Two as detailed in Section 23.5.2 without the need to be in receipt of a Grievance hearing decision.

23.2.2. Any bargaining dispute with the Company, related to the conduct of the bargaining only not the matter being bargained itself, arising from Sections 1.8 and/or 1.9 of this Agreement initiated by an EBR in accordance with Section 23.1.2.3 will commence at Stage Two as detailed in Section 23.5.2 without the need to be in receipt of a Grievance hearing decision.

23.2.3. Any bargaining dispute with the Company, related to the conduct of the bargaining only not the matter being bargained itself, arising from Sections 1.10 of this Agreement initiated by the Association in accordance with section 23.1.2.4 will commence at Stage Two as detailed in Section 23.5.2 without the need to be in receipt of a Grievance hearing decision.

23.2.4. Prior to filing a grievance the Grievor must discuss their complaint with the appropriate department Manager or his designated representative.

23.2.5. If, after completing Section 23.2.1, the Grievor is not satisfied with the outcome of the initial complaint, the Grievor may file a grievance with the Chief Pilot within twenty (20) days of the Grievor reasonably having knowledge of the occurrence or the facts giving rise to the grievance.

23.2.6. The written grievance must state:

23.2.6.1. what section(s) of the Enterprise Agreement, the Rostering Practices Policy, the Permanent Basings Policy Agreement and/or the NES has been breached;

23.2.6.2. what the Grievor has done to try and resolve the complaint; and

23.2.6.3. the remedy sought.

23.2.7. Any such grievance will be dealt with in accordance with the procedures as specified in Section 23.5.

23.2.8. Where the Company has received a Grievance in accordance with Section 23.2 and subsequently receives any further grievances for a complaint of fundamentally the same nature, the Company may delay commencing Section 23.5 in relation to the subsequent grievances until it has completed the steps in Section 23.5 in relation to the initial grievance.

23.3. Right of Representation

23.3.1. For the purposes of this section the Grievor will have the right to nominate a representative of his/their choice who is either an employee of the Company, a representative from the Association, or a representative of a Registered Organisation of which an individual Grievor is a member. The nominated representative cannot be a practising barrister or solicitor.

23.3.2. The representative nominated by the Grievor pursuant to this Section 23 Grievance will have access to Company premises for the purposes of dealing with the Grievance.

23.3.3. A Grievance Hearing or Grievance Appeal Hearing will not be held without the presence of the Grievor’s representative, if the Grievor requests such representation. However, the lack of availability of a specific representative chosen by the Grievor should not unnecessarily delay any part of the grievance process.

23.4. Grievor’s Rights

23.4.1. The Grievor and the Company will be given every reasonable opportunity to review evidence, make representations, and present, examine and crossexamine witnesses.

23.4.2. Throughout these procedures, the Grievor may, together with his representative (if any), review any relevant information contained in the Grievor’s Records, or any document that the Company has introduced at any step of these grievance procedures.

23.4.3. On request, either party will provide the other with a copy of any evidence that either party intends to introduce or rely on at any step of the grievance procedure.

23.5. Grievance Hearing

23.5.1. Stage One - Grievance Hearing: A Grievance Hearing between the Grievor and the Company will be convened according to the following procedures:

23.5.1.1. The Grievor will submit the grievance in writing to the Chief Pilot as per Section 23.2.2.

23.5.1.2. The Chief Pilot, or his designated representative, will hold a Grievance Hearing at an agreed time within fifteen (15) days of the submission of the grievance subject to rostering considerations and constraints of the Officer.

23.5.1.3. The Chief Pilot, or his designated representative, will render the Grievance Hearing’s decision in writing to the Grievor and his representative (if any) not later than ten (10) days following the completion of the Grievance Hearing.

23.5.2. Stage Two- Grievance Appeal Hearing: If the Grievance Hearing decision of the Chief Pilot, or his designated representative, is not acceptable to the Grievor, a Grievance Appeal will be heard according to the following procedure:

23.5.2.1. The Grievor’s appeal to the Grievance Hearing's decision will be submitted in writing to the relevant General Manager within ten (10) days of the Grievor’s receipt of the Grievance Hearing’s decision.

23.5.2.2. The General Manager or his designate will convene a Grievance Appeal Hearing within fifteen (15) days of the receipt of the Grievor’s appeal subject to rostering considerations and constraints of the Officer.

23.5.2.3. The General Manager or his designate will render his decision in writing to the Grievor and his representative (if any), not later than ten (10) days following the completion of the Grievance Appeal Hearing.

23.6. Outcome of Hearing

23.6.1. If, as a result of any Hearing or Appeal Hearing herein, the decision is reached for the Grievor, the Company will restore, reimburse or otherwise act to make the Grievor whole. These actions will be carried out as soon as practicable.

23.7. Dispute Resolution

23.7.1. Where the procedures outlined in Section 23.5 have been exhausted, the Grievor may initiate the Dispute Resolution procedure in accordance with Section 24 within forty (40) days of the Grievor receiving the final Company decision.’

For the Association

[9] The Association brought evidence from Captain Peter Teutscher, a Captain with Cathay since August 2002 and Chairman of the Association. Captain Teutscher was not involved in bargaining for the Agreement – the first enterprise agreement negotiated for Officers of Cathay in Australia and approved on 9 February 2016. However, he did have some understanding of how cl 11.2 came to be included in the Agreement.

[10] Captain Teutscher said that before the advent of internal technology, computer based training of officers was conducted on Company premises, which attracted an hourly credit payment. These changes resulted in an arrangement for officers to perform E-Learning, in their own time. On 23 November 2017, Captain Teutscher raised a claim on behalf of Officers, that approximately 10 hours of E-Learning annually was carried out by each Officer, as -training in their own time, using their own computer equipment and internet. The claim was presented at a meeting on 23 November 2017 with Cathay’s representative Ms Sarah Megson. This was the first time a claim of this kind under the new E-Learning clause had been raised. Captain Teutscher expected that discussions concerning payment of the claim would move forward. He claimed that at the time, Ms Megson agreed to the claim to be paid in January (2018) and Captain Teutscher communicated this information to the Association’s members. Captain Teutscher said that on 18 December 2017 Cathay advised:

‘We have reviewed the E-learning item. Given all is professional/flying related we won’t be paying any E-learning credit.’

[11] Captain Teutscher rejected this interpretation and in February 2018 sought to revisit the issue with Cathay in a meeting with Ms Megson and Mr J Wang. Captain Teutscher claimed the Company changed its position, when Mr Wang said that as E-Learning has to be GMF (General Manager Flying) certified, the Company would not pay the claim. It relied on cl 11.2.3 which reads:

‘11.2.3. E-Learning modules are those specified as such by GMF.’

Captain Teutscher believed that Cathay’s view was a power to retrospectively determine whether payment would be made for a particular course.

[12] Captain Teutscher said that after the Association’s elections on 13 March 2018, the new Committee resolved to instruct the Association’s solicitors to lodge a grievance about the non-payment of E-learning. A letter was sent to Cathay along these lines on 6 April 2018. The ultimate paragraph read:

‘We believe that the Company is mistaken in denying payment of this E-Learning claim. For the avoidance of doubt, this letter formally constitutes the initiation of a Grievance, undertaken by the AAOA on behalf of its members, in accordance with Australian Enterprise Agreement 2016 Section 23.’

[13] On 18 April 2018, the Company agreed to a Grievance meeting, without prejudice, on 25 April 2018, but advised of a concern with the timelines under the Agreement not being complied with. Captain Teutscher did not consider the 20 day time limit applied to the Grievance, as cl 23.2.5 referred to cl 23.2.1 which itself related to a Memorandum of Understanding of 2016 (‘MOU’). He claimed Mr Wang agreed with this. However, on 3 May 2018, the Company asserted that:

(a) the Grievance had not been filed in the specified time period; and

(b) the Association had not substantiated its meaning of E-Learning.

[14] On 10 May 2018, Captain Teutscher applied for an appeal of the rejection of the Grievance, citing that an extension of time to do so should not be unreasonably denied. On 15 May 2018, Mr D Perret, General Manager Aircrew, rejected the extension request ‘given the significant delays involved’ and that there was no lack of clarity as to how E-Learning was to be applied. It was Captain Teutscher’s belief that the timelines did not apply to all grievances or to this Grievance, in particular. At the very least, the clause (23.2.5) was ambiguous and it was therefore unreasonable for Cathay not to agree to an extension.

[15] In cross examination, Captain Teutscher agreed that as Chairman of the Association he represents hundreds of Australian pilots, he has regular correspondence and dealings with Management on behalf of these pilots, including raising grievances on their behalf. He was familiar with the terms of the Agreement in this regard. Typically, meetings with management occur in Hong Kong and he is provided with time ‘free of duty’ for this purpose. In addition, Captain Teutscher agreed he was provided with five days a month ‘free of duty’ to attend to Association business.

[16] Captain Teutscher explained that most Australian pilots are Airbus pilots and paid a salary for 1008 credit hours per annum. This can include actually flying, but allows for time free of duty to attend Association business. Captain Teutscher could not say whether in 2017/2018 the average credit hours of pilots was 840 per annum, but this was always a result of the discretionary decisions taken by the Company. Captain Teutscher agreed that most pilots work 20 hours a week. He agreed the balance of this time, for a 38 hour week, involved preparing letters and carrying out his Chairman’s duties. (It was accepted that Captain Teutscher was not questioned on the merits of the claim, given the only question at this stage related to the Grievance being invalid).

[17] Captain Teutscher claimed he had pursued the Grievance as to non-payment of E-Learning beginning on 23 November 2017. He accepted that by 18 December 2017, the Company had rejected the claim and confirmed its position on 7 February 2018. He accepted he took no steps to pursue the matter until 6 April 2018 – three and a half months after it had been initially rejected. He denied he did not act in a timely manner, as set out in cl 23.1.3 of the Agreement, although he was aware of the 20 day time limitation. However, he believed the limitation did not apply to this Grievance. He conceded that cl 23.2.5 deals with filing a grievance. Nevertheless, his view was that cl 23.2.5 only applied to a dispute about the Memorandum of Understanding (MOU) referred to in cl 23.2.1; see: para [8] above. He denied that the reference to cl 23.2.5 is an obvious typographical error.

[18] Captain Teutscher agreed that his request for an extension of time was made almost five months later from the time the claim was rejected. He believed this was a timely request, although acknowledged the request could have been made earlier. However, the delay was caused by Cathay’s change in its position as to why it rejected the claim. He rejected the suggestion he was neglectful in not raising the claim earlier.

SUBMISSIONS

For the applicant

[19] in written submissions, Mr Kennedy set out the background to the dispute and the relevant steps in the DSP under the Agreement to demonstrate that:

(a) the dispute is in relation to a matter arising under the Agreement;

(b) the dispute is unable to be resolved at the workplace; and

(c) all agreed steps for resolving the dispute under cl 23 have been followed.

[20] Mr Kennedy correctly submitted that Cathay’s objection rests on cl 23.2.5. However, this clause is predicated on the initial complaint being about the MOU of 2016. As this dispute was unrelated to that matter, cl 23.2.5 has no application and therefore time limits therein are not applicable. Mr Kennedy rejected Cathay’s claim that the reference to cl 23.2.1 (the MOU clause) in cl 23.2.5 is an error and should refer to cl 23.2.4. Mr Kennedy put that the Commission would reject this claim as self-serving and only being invoked for the purposes of avoiding dealing with the substance of the dispute. He noted:

(a) the Agreement commenced operation in February 2016;

(b) despite being apparently aware of the purported error, Cathay did not formally advise the Association of its position in that respect, until after this application was filed; and

(c) Cathay had taken no steps to discuss the purported error with the Association or otherwise address the purported error, for example, by way of a variation to the Agreement to correct an ambiguity or uncertainty, pursuant to s 217 of the Act.

[21] In the alternative, Mr Kennedy put that it would be inimical to the General Principles of cl 23.1.1 to deny an opportunity to present a case by relying on undue timelines. There should be a common sense and reasonable approach, based on natural justice and procedural fairness; see: Minister for Immigration and Border Protection v SZVFW [2018] HCA 30 at [39]. Mr Kennedy relied on Captain Teutscher’s evidence to demonstrate that the consent refused was unreasonable because:

(a) Mr Teutscher had carriage of the matter for the Association, and was not aware of the time limitation;

(b) Mr Teutscher’s role with the Association is in an honourary capacity, which he performs in addition to his full-time employment;

(c) after receiving confirmation that the Respondent rejected the claim for the reasons provided on 7 February 2018, Mr Teutscher took steps to advance the Grievance;

(d) there were elections for the Association during March 2018, which required Mr Teutscher’s attention and priority; and

(e) the Grievance was lodged shortly after being approved by the newly elected General Committee on 22 March 2018.

[22] Further, Mr Kennedy put that there is at least some ambiguity in the clause and, as Cathay submitted, a significant error, Captain Teutscher relied on his reasonable understanding of cl 23.2.5. No prejudice would be suffered by Cathay, as they have taken no steps to correct the error.

For Cathay

[23] Mr Perry referred to the constraints on the Commission’s powers to deal with a dispute when the DSP in an Agreement has not been followed, as is the case here; see: AWU v MC Labour Services Pty Ltd [2017] FWCFB 5032. The Association’s reliance on cl 23.1.1 (MOU provision) in cl 23.2.5 is plainly wrong and an obvious error because:

(a) Clause 23.2.5 is the only provision of the Agreement which provides for the filing of a grievance. It is only once a grievance is filed under that provision that ‘any such grievance’ is dealt with in accordance with clause 23.5 (see clause 23.2.7). If clause 23.2.5 only operates in relation to disputes about the MOU, then those are the only disputes which can be dealt with through the grievance procedure at all. Such a result cannot possibly have been intended, and the Commission would prefer an available interpretation of the Agreement which avoids it. Indeed, if this construction were correct, the Association’s Grievance would be incompetent for the alternative reason that it did not concern the MOU.

(b) There is no reference in clause 23.2.1 to any ‘initial complaint’ – rather, the clause provides that where a grievance concerns the MOU, it progresses directly to a grievance appeal hearing. ‘Initial complaints’ are the subject of clause 23.2.4, which provides that:

Prior to filing a grievance the Grievor must discuss their complaint with the appropriate department Manager or his designated representative.

[24] Mr Perry put that the fact that there had been no complaint is irrelevant, as post agreement conduct cannot be called in aid of interpretation; see: AMWU v Berri Pty Ltd[2017] FWCFB 3005, whereas Cathay’s position has always been the correct position. It followed that the 20 day time limitation in cl 23.2.5 applies, as Cathay made clear the E-Learning claim would not be paid on 18 December 2017, or at the very latest when it reaffirmed this position on 7 February 2018. No grievance was validly filed and clause 23 was not followed. Therefore, the right to bring a dispute under the DSP never arose.

[25] Mr Perry submitted that the question of consent being withheld unreasonably, simply does not arise because the filing of the Grievance was not met. It cannot be ‘deemed’ to have been filed to activate any consideration of unreasonableness, even before a recognition that mutual agreement was required. Moreover, a claim that Cathay’s refusal to extend time was unreasonable, amounts to a claim that cl 23 had been breached. This would need to be determined judicially – a function beyond the Commission’s powers.

[26] Even assuming the Commission could do so, Mr Perry argued that it was not unreasonable for Cathay to withhold its consent. He noted that there is no definition of unreasonableness under the Agreement. Mr Kennedy’s reliance on Minister for Immigration and Border Protection v SZVFW was misconceived, as that case went to the fundamental rights of persons of refugee status; a far cry from theinterests of pilots pursuing an E-Learning claim.

[27] To the extent that unreasonableness can be considered, some guidance can be had with the principles applying to the extension of time to lodge appeals under the Act; Rule 56(2) of the Fair Work Commission Rules 2013. These would include:

(a) There are good reasons for which the parties agreed to time limits in the Agreement, and they should not be extended as a matter of course. The Agreement itself provides that the parties will adhere to all timelines to ensure that grievances are dealt with in a timely and effective manner, but there ‘may, however, be occasions when these timelines need to be extended’ (clause 23.1.6; emphasis added).

(b) The length of the delay, and whether there is a satisfactory explanation for it, are relevant. A longer delay will suggest a withholding of agreement to an extension, is not unreasonable, as will a delay for which there is no adequate explanation.

(c) The unlikelihood of the Association succeeding with its claim, if time had been extended is also relevant.

[28] Mr Perry accepted that there would be little prejudice to Cathay if an extension was agreed to, but in this case the delay was significant. Moreover, Captain Teutscher’s claims of inexperience and not being aware of the timelines, are inconsistent with his duties as Chairman of the Association. The fact of Union elections is completely irrelevant to a failure to comply with timelines under the Agreement. Mr Perry put particular emphasis on cl 23.1.1.3 which reads that all grievance procedures and actions will ‘be conducted in a timely and expeditious manner.’

[29] In any event, the Association’s E-Learning claim is weak and the Association’s complaint of unreasonableness really amounts to nothing more than a decision it disagrees with; see Minister for Immigration and Border Protection v SZVFW and comments of Kiefel CJ that a requirement for a decision maker to act reasonably, does not require the decision to be one that is advantageous to the person to whom it relates.

[30] In any event, even if this dispute was about lawful entitlements, the oft quoted passage of Madgwick J in Kucks v CSR Ltd (1996) 66 IR 182 (‘Kucks’) at 184 is opposite:

‘... the task remains one of interpreting a document produced by another or others. A court is not free to give effect to some anteriorly derived notion of what would be fair or just, regardless of what has been written into the award. Deciding what an existing award means is a process quite different from deciding, as an arbitral body does, what might fairly be put into an award.’

[31] In reply submissions, Mr Kennedy submitted that cl 23.2.5 must be accorded its ordinary and usual meaning and therefore the clause only has application to disputes concerning the MOU. He rejected this interpretation as limiting all grievances to the MOU, as the surrounding clauses refer to other steps to be taken in respect to other grievances.

[32] As to the unreasonableness of the refusal, Mr Kennedy said that this does not require mutual agreement as a first step. On Cathay’s construction it could merely reject all requests for an extension and the Commission would have no jurisdiction to consider a dispute. This would be plainly unjust and could never have been the intention of the parties. No judicial determination is being sought; rather the Commission can simply apply a fair and common sense assessment of unreasonableness.

[33] Mr Kennedy submitted that the only relevant date to be considered was when on 7 February 2018, Cathay changed its reasons for refusing the claim. On this basis the Grievance lodged on 6 April 2018 was only 21 working days ‘out of time’.

[34] Mr Kennedy reinforced Captain Teutscher’s evidence which disclosed that he had diligently pursued the Grievance by taking various steps to do so, including seeking legal advice after a new Association Committee was elected around 13 March 2018. It is also relevant that most of the Association’s officials are not full time officers and continue their full time roles working for Cathay.

[35] Mr Kennedy rejected Mr Perry’s reliance on the principles the Commission applies for ‘out of time’ appeals, as they involve entirely different considerations. He also observed that it is difficult to accept the Association’s case was weak when it had originally been accepted by Ms Megson; se: para [10] above. To suggest that Cathay has an unfettered discretion to define E-Learning in the absence of any definition in the Agreement, should be rejected. Where such training is undertaken in a pilot’s own time, under direction from management, the benefits of cl 12 should apply. All this evidence demonstrates a strong merits case.

[36] In oral submissions, Mr Kennedy rejected Cathay’s submission that the Commission’s determination of unreasonableness would be an impermissible judicial function and relied on Construction, Forestry, Mining and Energy Union v Australian Industrial Relations Commission [2001] HCA 16. Here the parties directly envisage the Commission exercise powers under the DSP, including resolving a question of the unreasonableness of Cathay’s withheld consent.

[37] Mr Kennedy advised that a new grievance had been lodged about this claim during the new entitlement period. The parties have agreed to ‘park’ that matter, pending the outcome in this case.

[38] In oral submissions, Mr Perry put that the logic of the Association’s argument is that there is no other source of an entitlement to file a grievance, unless it relates to the MOU of 2016. This was a ‘fairly dangerous’ submission to put and one that Cathay does not embrace. On the contrary, Mr Perry said that the cross reference between cl 23.2.4 with 23.2.5 makes it abundantly clear that the reference to cl 23.2.1 is an obvious error. He pointed to repeated references to ‘timelines’ and ‘efficiency’ in cl 23 to stress the importance of time limitations. In this case there was a ‘fairly leisurely’ progress of a grievance, contrary to the intent of the parties to have such a matter dealt with expeditiously. Moreover, the delay was substantial – from 18 December 2017 to 6 April 2018. In addition, ignorance of the law is not an excuse, particularly for someone of Captain Teutscher’s professed regular involvement in representing the Association’s members’ interests.

[39] In reply, Mr Kennedy submitted that ignorance of the law can hardly be put when the clause in contest was only recently said by Cathay to have been an error.

CONSIDERATION

[40] At the outset I observe that with such prescriptive mandatory timelines for dealing with grievances, it is no wonder a particular matter might slip through the cracks, or its processing might become problematic. However, that is not the case here. The accepted timelines make abundantly clear that on 18 December 2017, Cathay had rejected the E-Learning claim, it reaffirmed its position on 7 February 2018 and the Grievance was then not moved until 6 April 2018; in total a period of almost four months.

[41] For Captain Teutscher to suggest this was ‘timely’ in accordance with the ordinary, plain meaning of that word and in accordance with cl 23.1.1.3 which reads:

‘23.1.1 All grievance procedures and actions will:

…

23.1.1.3. Be conducted in a timely and expeditious manner.’

is frankly incredible and strains the meaning of the word beyond recognition.

[42] Captain Teutscher’s evidence was that the delay was due to the change in Cathay’s reason for refusing the claim from 18 December 2017 to 7 February 2018. Even if this was the case, it does not explain the delay from 7 February 2018 to 6 April 2018. In any event, in my view, it was irrelevant that the reason might have been different. The relevant circumstances, which had not wavered, and was not in any doubt, was Cathay’s unequivocal rejection of the claim on 18 December 2017. If there was a trigger for the 20 day timeline that must have been the date. Nor do I accept it is relevant that Ms Megson may have given a favourable response to the claim on 13 December 2017. The fact was Cathay changed its position and this was made crystal clear on 18 December 2017.

[43] As to the reliance of the Association on a proposition that the 20 day limitation only applied to the MOU of 1 January 2016, because of the reference to cl 23.2.1 in cl 23.2.5, in my opinion, this must be a blatant and obvious error. It makes no sense contextually, when the clause is read as a whole and is illogical because it means the intervening steps cl 23.2.2, 23.2.3 and particularly cl 23.2.4 which refers to the filing of a Grievance that the Grievor must have discussed the complaint with their Manager, are simply ignored.

[44] In my judgement, the common contextual meaning of the clause is readily ascertainable by the constant use of the words ‘grievance’ and ‘Grievor’ in both sections dealing with General Principles and then the Filing Process. As I earlier opined, given the highly prescriptive nature of these provisions, it is little wonder an obvious typographical error in cross referencing would not have been picked up in drafting or editing. Obviously, this error should be attended to if this clause is to be replicated in future iterations of the Agreement.

[45] Accordingly, when viewed in a common sense and logical way, the requirement for mutual agreement of extensions to timelines throughout cl 23 Grievance, must include cl 23.2.5 and the specific Grievance of the Association in this case.

[46] While I can understand the Association ‘grasping at whatever straw’ it can in arguing that cl 23.2.5 does not apply, in my view, its approach is wrong and the reference to cl 23.2.5 is an obvious error which is being exploited through a narrow, pedantic and unrealistic prism.

[47] In any event, it is difficult to reconcile Captain Teutscher’s belief that the 20 day time limit did not apply to the E-Learning Grievance, when he sought an extension of time on 10 May 2018. Put another way, if it is correct (which it is not) that the E-Learning Grievance was not covered by the 20 day limitation, why would you need an extension for something which did not apply?

[48] As to the secondary argument that consent for an extension was ‘unreasonably withheld’ by Cathay, it is unnecessary for me to determine Mr Perry’s submission that this would amount to an impermissible exercise of the Commission’s powers, notwithstanding this proposition is not unarguable. However, I am able to provide an opinion under s 739 of the Act and I do so as follows. On any objective view, a period of almost four months, vis a vis 20 days, is significant. To my mind, a delay of this length tells in favour of Cathay’s view that it had acted reasonably in withholding consent for an extension.

[49] Fort the reasons herein set out, I am satisfied that the dispute lodged in this matter does not fall within the Commission’s jurisdiction, as the steps taken to process the relevant Grievance have not been complied with. Accordingly, the application must be dismissed.

DEPUTY PRESIDENT

Appearances:

J Kennedy, Solictor for the Australian Aircrew Officer’s Association.

D Perry, Solictor with S Megson for Cathay Pacific Airways.

Hearing details:

2018.

Sydney.

October 22.

Printed by authority of the Commonwealth Government Printer

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