Australian Collieries Staff Association v Newlands Coal Pty Ltd

[1998] FCA 1722

FEDERAL COURT OF AUSTRALIA

INDUSTRIAL LAW – interpretation – whether construction of award must be done by examination of the provisions of the award without assistance of extrinsic material - whether engagement of temporary employee without having consulted Branch Secretary of the Association or by order of appropriate industrial authority was in breach of the award – interpretation of “casuals and temporaries” clause.

Workplace Relations Act 1996 (Cth), s 178(1)
Coal Mining Industry (Supervision and Administration) Interim Consent Award 1990, Queensland

Short v FW Hercus Pty Ltd (1993) 40 FCR 511, referred to
Curragh Queensland Mining Ltd v CFMEU (1997) 77 IR 232, applied

AUSTRALIAN COLLIERIES STAFF ASSOCIATION v NEWLANDS COAL PTY LTD

QG 120 of 1997

DRUMMOND J
12 NOVEMBER 1998
BRISBANE

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	QG 120 of 1997

BETWEEN:	AUSTRALIAN COLLIERIES STAFF ASSOCIATION APPLICANT
AND:	NEWLANDS COAL PTY LTD (ACN 010 082 578) RESPONDENT

JUDGE:	DRUMMOND J
DATE OF ORDER:	12/11/98
WHERE MADE:	BRISBANE

THE COURT ORDERS THAT:

1. The application be dismissed.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
QUEENSLAND DISTRICT REGISTRY	QG 120 of 1997

BETWEEN:	AUSTRALIAN COLLIERIES STAFF ASSOCIATION APPLICANT
AND:	NEWLANDS COAL PTY LTD (ACN 010 082 578) RESPONDENT

JUDGE:	DRUMMOND J
DATE:	12/11/98
PLACE:	BRISBANE

REASONS FOR JUDGMENT

This is an application by the applicant Union for the imposition of a penalty on the respondent pursuant to s 178(1) the Workplace Relations Act 1996 (Cth) for breach of cl 6(b) of the Coal Mining Industry (Supervision and Administration) Interim Consent Award 1990, Queensland (“the Award”).

Clause 6 provides:

CASUALS AND TEMPORARIES

(a)       Casuals

(1)A casual employee is one engaged and paid as such.

(2)A casual employee, for working ordinary time, shall be paid at an hourly rate ascertained by dividing the appropriate classification rate by 37.5 plus 25% with a minimum of 4 hours payment.

(3)A casual employee may be engaged after consultation with the nominated representative of the Association to fill any vacancy created by a permanent employee being on leave of absence, or in the event of a short-term requirement.

(b)       Temporaries

A temporary employee may be engaged for a fixed term or defined task after consultation with the Branch Secretary of the Association or by order of the appropriate industrial authority.

The Union’s case is that on 1 April 1997, the respondent engaged one Hall as a temporary employee for a fixed term, ie, until 1 June 1997, in the coal preparation plant at its Newlands site.  He was employed there as a temporary supervisor, ie, to a classification of employment in Group K in cl 10 of the Award.  The applicant further alleges (in para 10 of its pleading) that the respondent did not consult with Mr Norris, its Branch Secretary, at any time prior to so engaging Mr Hall.  In its defence, the respondent “admits that it did not consult with Gary John Norris prior to engaging Mr Steven Hall as referred to in para 10 of the Statement of Claim”.  It goes on to deny that it was obliged by the Award to do that.  The basis for this allegation, as revealed by the defence, is that the Award is “a member’s only” award and cl 6(b), on its proper interpretation, did not impose any obligation on the respondent to consult in respect of Mr Hall’s engagement for the reason that Mr Hall was not a member of the applicant Union.  In addition, the respondent contended that the relevant Award conditions as to consultation were not mandatory.

At the hearing, the respondent sought, on the basis of some material in its affidavit evidence, to raise an argument to the effect that such communications as did take place between an officer of the respondent and a site official of the applicant with respect to Mr Hall’s employment were sufficient to enable it to rely on cl 31 of the Award to take it out of any consultation obligation which might otherwise have been imposed on it by cl 6(b).  The respondent’s defence contains no hint of this argument.  It raises a substantial factual enquiry.  Although some of the matters relevant to this enquiry were the subject of evidence in Mr Norris’ affidavit, I accept that such material was directed to the penalty that should be imposed, in the event of the Court finding a breach proved.  If the respondent had been permitted to raise this entirely new ground of defence - and it would have needed leave to amend its defence to do that - the applicant would have been justified in having the adjournment it foreshadowed seeking to consider what additional factual material it might wish to put before the Court.  Ultimately, the respondent did not seek leave to amend its defence so that the issues for determination are confined to the two matters I have referred to.

These issues are essentially concerned with the proper construction of the Award.  It is a task which must be undertaken in the circumstances of this case by an examination of the provisions of the Award without the assistance of any background facts.  Cf Short v FW Hercus Pty Ltd (1993) 40 FCR 511 at 517 - 520 and 523. I provisionally admitted some passages in Mr Norris’ affidavit as relevant to the factual background to the Award. But, on reflection and on the assumption that that practice was in place prior to the making of the Award, the practice there deposed to is equivocal in its capacity to throw light on the proper construction of cl 6. I therefore decline to admit this material. It follows that that part of the evidence of Mr Caslick, the respondent’s deponent, admitted provisionally as relevant to the matters raised by this portion of Mr Norris’ evidence, should also be excluded.

It is clear from cl 4 that the Award binds only the respondent and the other employers named in Schedule A to the Award in respect of members of the applicant Union employed by them in the coal mining industry and the applicant and its members.  It is prima facie a “members only” Award, as opposed to an “all employees” Award.  That this was the proper characterisation of the Award was common ground at the hearing.  Most of the operative provisions of the Award are expressed to apply to employees, rather than just to employees who are also members of the applicant Union.  One such provision is cl 11, dealing with the payment of wages to “the employee”.  But by force of cl 4, this provision only operates to regulate the payment of wages by employers bound by the Award to employees who are members of the applicant.  Employers are free from any constraint imposed by this clause on how they may pay wages to employees who are not members of the applicant.  Most of the provisions of the Award, like cl 11, operate only by reference to member-employees.

But as Merkel J explained in Curragh Queensland Mining Ltd v CFMEU (1997) 77 IR 232 at 237 - 238, there is no necessary inconsistency between an Award having a general “members only” application and its containing a particular provision which imposes an obligation, enforceable by the Union, on an employer-party in respect of employees who are not members of the Union.

Some provisions of the Award clearly have an operation extending to all employees, ie, to both the employees who are members of the applicant Union and to non-member employees.  Clause 25 is one such provision; it has a direct effect upon the employment of non-members by subordinating their job security to that of certain classes of member-employees.  Clause 26A is another such provision; where the employer has made a decision to introduce major workplace changes, it obliges the employer to notify “the relevant employee(s) and union(s) who may be affected by the proposed changes” and to consult with those employees and unions with a view to identifying measures likely to mitigate the adverse effects of such changes “on employees”.  Since a planned major change can be expected to affect a group of employees made up of both members and non-members of the applicant, it would make no sense to read this clause as obliging the employer to notify and consult with only the affected member employees:  the object of the clause is to identify, by the consultation process, any practicable measures which may mitigate the impact of the changes on the member-employees and consultation with the relevant non-member employees is just as likely to identify such measures as is consultation with the member employees.  Clause 16(e) is another such provision:  it obliges the employer to involve non-member employees, along with member employees, in any negotiations for an agreement of the kind covered by the clause.  Without involving all, it would not be practicable to implement the alteration to working days contemplated.

Apart from cl 6, the provision central to this matter, only two clauses of the Award - cll 5(d) and 27(d) - refer in express terms to workers employed on a casual or temporary basis.  I read cll 5(a), (b) and (c) as governing, with respect to the matters dealt with by that clause, the rights and obligations only of employees who are members of the applicant.  These provisions are in form statements of the rights, obligations and entitlements of all on whom the Award is binding, ie, the employer-parties and member-employees; there is no indication in the language of those provisions and nothing to be inferred from their likely operation that they have or need to have, in order to operate sensibly, a more extensive application than that.  Clause 5(d) therefore should be read as referring by use of the expression “casuals” to those employees who would, but for this sub-clause, be subject to the preceding provisions of cl 5, ie, as referring only to employees who are Union members employed as casuals.  Clause 27(a) and (b), in the context of a “member’s only” Award, must, I think, be read as conferring the benefits the subject of those provisions on member-employees only, for much the same reasons as, I think, cll 5(a), (b) and (c) should be so read.  Clause 27(d) is therefore designed to ensure that those employees who might be able to satisfy the qualifications for these benefits and so would be entitled to receive them, viz, persons who are both employees of employers bound by the Award and also members of the Union, are nevertheless not to have any entitlement to those benefits, if they are only employed on a casual or temporary basis.

That wherever there is reference to a casual or a temporary employee in this “members only” Award, these expressions are used as referring only to member-employees employed on one or other of these non-permanent bases is a strong indication, in my opinion, that the expressions are used in the same sense in cl 6.  It would therefore require a strong indication in that clause itself to justify reading it as using the expressions “casual employee” and “temporary employee” in a different sense, ie, as referring to employees, irrespective of whether they are members of the Union.  I can find no such indication in the clause; it can have a sensible operation if read as applying only to member-employees.

It was argued that the nature of the employment of the member-employees, which is the general subject of the Award, is permanent employment.  There are numerous provisions that support this proposition, eg, cll 5(b), 17, 18, 21, 22(c), 25 and 27.  It was then said that the Union has a real interest in monitoring the extent to which employers bound by the Award engage employees on a casual or temporary basis, whether or not they are members of the applicant:  that would enable the Union to be in a position to make informed decisions on the action necessary to protect the “norm” of permanent employment of its members.  That is no doubt true. 

But there is nothing in the Award to create any expectation that Union members will be preferred for any employment that is available, whether permanent or non-permanent.  There is, eg, no preference clause of the kind contained in the award in Curragh subject only to the possible application of cl 6, the Award does not impose any bar on employers engaging as many non-member employees as they wish, whether as permanents, casuals or temporaries.  There is no obligation imposed on an employer by cl 6 or any other provision to consult with the Union before employing a non-unionist in a permanent capacity.  Further, cll 6(a)(3) and (b) are directed to requiring the employer, before it engages a particular person on a non-permanent basis, to consult with the Union about that particular engagement.  This all suggests that the focus of the clause is not on protecting or advancing the interest of union-members as against non-members, but rather on advancing the interest that members who are being considered for employment have in being engaged on the more advantageous permanent, rather than on a non-permanent, basis.

Given this and that prima facie, the provisions of this Award apply to members only and given the clear indications that the expressions “casual” and “temporary” employee, when used elsewhere in the Award, refer to members employed on those limited bases rather than to any employee, whether a member or not, so employed, I would read cl 6 as confined in its operation to the engagement only of persons on one or other of these limited bases who are members of the applicant.

It follows that I uphold the respondent’s submission that it was under no obligation to consult with the applicant in respect of its engagement of Mr Hall.

I will deal briefly with the second answer made by Newlands to the charge that it breached cl 6 in respect of Mr Hall’s employment.  Newlands draws from its contention that the language of cl 6(b) is permissive, in contrast to the mandatory language of other provisions of the Award, such as cl 9, the proposition that a failure to consult before employing a temporary as required by cl 6(b) does not constitute a breach of the Award; instead, such a failure to consult is said only to convert an offer of temporary employment for a fixed term that may be accepted by the particular employee into permanent employment for an indefinite term.  I reject the argument.  Newlands did not identify the consequence of a failure by the employer to consult as required by cl 6(a)(3) on the employer’s offer to employ a person as a casual.  Consistency would suggest that if the argument is correct, failure by an employer to consult would operate, even over objection by a non-member employee at being denied the higher casual pay rates he had bargained for, to convert a contract for casual employment into one for permanent employment too.  That would be a surprising result.  If that is the consequence of a failure to consult, it would need to be stated in clear language.  The relevant wording of cl 6 is, in my opinion, clear:  if there is no consultation, the employer breaches the Award.  But that is all.  Any such breach leaves entirely untouched the nature of the particular contract of employment that comes into existence upon the engagement of the employee, either as a temporary or as a casual.

The application is dismissed.

I certify that this and the preceding five (5) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Drummond.

Associate:

Dated:             12/11/98

Counsel for the Applicant:	Mr JE Murdoch
Counsel for the Respondent:	Mr S Howells
Solicitor for the Respondent:	Nall Payne
Date of Hearing:	5 November 1998
Date of Judgment:	12 November 1998