Australian Concert & Entertainment Security Pty Ltd T/A ACES Group v David Mapledoram
[2020] FWCFB 7032
•23 DECEMBER 2020
| [2020] FWCFB 7032 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.604—Appeal of decision
Australian Concert & Entertainment Security Pty Ltd T/A ACES Group
v
David Mapledoram
(C2020/6719)
VICE PRESIDENT CATANZARITI | SYDNEY, 23 DECEMBER 2020 |
Appeal against decision order [PR721809] of Deputy President Bull at Sydney on 13 August 2020 in matter number AG2019/2673.
Overview
[1] Australian Concert & Entertainment Security Pty Ltd T/A ACES Group (the Appellant) has lodged an appeal under s 604 of the Fair Work Act 2009 (Cth) (the Act), for which permission to appeal is required, against a Decision 1 and Order2 of Deputy President Bull issued on 13 August 2020. The Decision dealt with an application (the Application) by Mr David Mapledoram (the Respondent) to terminate the ACES (Permanent Employees) Enterprise Agreement 20073 (the Agreement) pursuant to s 225 of the Act.
[2] The Agreement was made between the Appellant and the Media Entertainment and Arts Alliance, being a union collective agreement. The Agreement commenced operation on 27 June 2007 and the Agreement’s nominal expiry date is 26 June 2012. 4
[3] In the F7 – Notice of Appeal, the Appellant sought a stay of the Order. On 13 November 2020, a stay order was issued 5, after the Respondent indicated that they did not oppose the stay order sought by the Appellant.6
[4] On 2 November 2020, the Australian Council Trade Unions (ACTU) sought leave to file written submissions in light of the broader public interest issues that the appeal proceeding raises. Both parties indicated in separate email correspondence that they had no objection to the ACTU’s request. On 6 November 2020, the Full Bench granted the ACTU leave to intervene in the proceedings.
[5] The Appellant and the Respondent sought permission to be legally represented at the hearing. The Full Bench granted the parties’ permission to be represented pursuant to s 596(2)(a) of the Act on 17 November 2020. The matter on appeal was subject to a video hearing on 19 November 2020.
[6] The Full Bench has heard the parties on permission to appeal and the substantive appeal.
Decision under appeal
[7] The Deputy President first noted that the Appellant had advised that the Respondent was dismissed on 19 November 2019. 7 The Deputy President then noted that as the Respondent was an employee covered by the Agreement under s 225(b) of the Act at the time of filing the Application, he had the necessary standing to bring the Application.8
[8] After considering the legislative requirements 9 and the evidence and submissions of the parties10, the Deputy President considered each of the elements under s 226 of the Act in respect of whether to terminate the Agreement. Relevantly, section 226 of the Act provides as follows:
“226 When the FWC must terminate an enterprise agreement
If an application for the termination of an enterprise agreement is made under section 225, the FWC must terminate the agreement if:
(a) the FWC is satisfied that it is not contrary to the public interest to do so; and
(b) the FWC considers that it is appropriate to terminate the agreement taking into account all the circumstances including:
(i) the views of the employees, each employer, and each employee organisation (if any), covered by the agreement; and
(ii) the circumstances of those employees, employers and organisations including the likely effect that the termination will have on each of them.”
[9] In respect of s 226(a) of the Act, the Deputy President was not satisfied that the contentions advanced by the Appellant resulted in a conclusion that it would be contrary to the public interest to terminate the Agreement. The Deputy President reasoned that there were no factors which “push the weight of public interest considerations to concluding that terminating the Agreement would not be in the public interest.” 11
[10] In considering s 226(b)(i) of the Act, the Deputy President noted the views of the one employee who gave evidence in support of the termination, the Respondent and the evidence of Mr Spiros Parissis (a security ranger employed by the Appellant) who opposed the Application. The Deputy President noted that the Appellant did not support termination of the Agreement.
[11] In respect of s 226(b)(ii) of the Act, the Deputy President referenced clauses in the Agreement which operated to exclude protected award conditions 12 and the fact that the Agreement did not contain a number of non-monetary benefits contained in the relevant award13. The Deputy President observed that it was not clear that the Agreement benefits employees overall in comparison to the relevant award.14
[12] Having made the above observations, the Deputy President considered whether it was appropriate to terminate the Agreement. The Deputy President observed that the requirements of s 225 of the Act had been met, and that no evidence was before him to indicate that “it would not be appropriate taking into account all the circumstances including those listed at s.226(b)(i) and (ii) of the FW Act to terminate the Agreement” 15.
[13] Accordingly, the Deputy President was satisfied that pursuant to s 226 of the Act, the Agreement should be terminated. An Order was issued to this effect. 16 The Deputy President exercised his power under s 227 to provide that the termination would take effect four months from the date of the Order to enable the Appellant sufficient time to accommodate any changes that may need to be made within its business.17
Consideration
Appeal ground one
[14] Appeal ground one contended that the Order was made in excess of jurisdiction as although the Respondent was an employee covered by the Agreement at the time the Application was made, he ceased to be an employee prior to the Order being made. The crux of the Appellant’s submission was that s 225 of the Act ought be interpreted to require a person who applies to the Commission for the termination of an agreement to be an employee at the time of the formal application as well as during the prosecution of the application up until the time that a decision of the Commission is made.
[15] Having regard to the relevant principles of statutory construction, 18 we see no basis in the notion that an applicant must remain employed after an application is validly made under s 225, up until the Commission issues a decision pursuant to s 226 of the Act. There are no words within s 225 which expressly stipulate this requirement. We would observe that s 225 is concerned only with the making of an application for an enterprise agreement whereas s 226 outlines when the Commission must terminate an agreement, without reference to the applicant. This can be contrasted with s 238 applications for scope orders, which can be made by bargaining representatives and for which a pre-requisite is the Commission being satisfied that the bargaining representative who made the application has met, or is meeting, the good faith bargaining requirements.19
[16] We also reject the Appellant’s contention that the words “may apply” in the context of s 225 of the Act can be construed as expressing the requirement that an applicant must remain employed after an application is validly made. We would concur with the observations made by Colman DP in Lennox v Footlong Subs Employment Services Pty Ltd:
“[13] There is no textual basis for the proposition that the Commission cannot deal with an application made under s.225 of the FW Act after an applicant ceases to be employed by the relevant employer. This contention reads into sections 225 and 226 words that are not there. The fact that the applicant is no longer employed by the company and is not now covered by the Agreement does not affect the validity of her application.” 20
[17] In support of his construction that it cannot automatically be assumed that an employee who is terminated subsequent to making a valid termination application necessarily loses an interest in the outcome of the proceedings, the Respondent had submitted the capacity for the Commission to make the termination retrospective was a consideration weighing in his favour. Section 227 of the Act provides that if “an enterprise agreement is terminated under s 226, the termination operates from the day specified in the decision to terminate the agreement.”
[18] The Appellant accepts that if the Commission has the capacity to make a termination of an agreement retrospective, this would be “a very powerful consideration” in the Respondent’s favour but its position is that in relation to s 227, the Commission has no power to retrospectively terminate. 21
[19] The Appellant submits s 227 does not permit retrospective termination of the agreement and that the words “day specified in the decision” in s 226 mean a day on or after the date of the decision for four reasons:
1) The fact that Parliament did not expressly prohibit retrospective termination of an enterprise agreement does not mean that it intended to permit retrospectivity, with the fact that Parliament found it necessary to expressly permit retrospectivity in one instance 22 illustrating that an intention to permit retrospectivity cannot be inferred from silence alone;
2) There is a general interpretive presumption, well-known to Parliament, that legislation is not intended to retrospectively alter accrued rights and liabilities in the absence of clear language;
3) The contrast between s 227 and the provisions governing retrospective changes to awards 23 strongly suggest that s 227 was not intended to permit retrospective termination; and
4) There is no binding or persuasive authority demonstrating that s 227 permits retrospective termination. 24
[20] The Respondent submits there are contextual considerations, including the legislative history, that lead to the following conclusions:
1) It has long been understood that agreements can be varied retrospectively;
2) It has long been accepted that retrospective variation or setting aside of terms may interfere with accrued rights, and the appellant’s appeal to that consideration in this case cannot be supported;
3) The power in the tribunal to set aside an agreement has existed for many years in tandem with the power to vary;
4) The framers of the Act are taken to have known the existing law, and there is no reason in principle why the legislature did not intend that, in appropriate circumstances, agreements could be terminated retrospectively, particularly considering the historically close alignment between the powers of the tribunal to non-consensually vary and terminate;
5) The context provided by the analogous provisions in Division 7 of Part 2-4 supports the construction it propounds because ss 216, 217(2), and 224, which deal with the operative dates of variations or termination of an enterprise agreement, adopt the same formula as s 227, namely that the change operates from “the day specified in the decision” to, relevantly, approve consensual variation or termination, or vary or terminate non-consensually. 25
[21] The question as to whether the termination of an Agreement can operate retrospectively was considered in detail by Colman DP in Application by Kelly (Kelly). 26 As the Deputy President observed, the majority in Project Blue Sky Inc v Australian Broadcasting Authority27 outlined that the primary object of statutory interpretation is “to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute” and that the meaning of a provision is to be determined “by reference to the language of the instrument viewed as a whole.” 28
[22] The Deputy President concluded that while the text of s 227 does not confine a ‘specified day’ to a current or prospective day, this is its objective meaning when read in the context of the Act as a whole. 29 The analysis of the Deputy President leading him to conclude that there is no power for the Commission to terminate the Agreement with retrospective effect, included:
1) The presence in the Act of ss 165 and 297 indicates that, where Parliament has conferred on the Commission power that is exercisable with retrospective effect, it has done so expressly;
2) That ss 165, 297 and 227 are all concerned with the Commission’s role in determining the time from which a decision will have effect is significant and the common use in these provisions of the formulation ‘day specified’ indicates a legislative awareness of a functional connection between them. This in turn underscores the differential way in which Parliament has chosen to confer retrospective power on the Commission under ss 165 and 297, but not s 227;
3) It cannot have been Parliament’s intention to leave to the Commission an unlimited, broad discretion to decide whether to retrospectively re-write the employment conditions of a particular workforce under s 227, when the retrospective power in ss 165 and 297 is exercisable only in exceptional circumstances;
4) The absence of any provision addressing the consequences of a retrospective termination of an enterprise agreement, when ss 167 and 298 do just that, is a further clear indicator that Parliament did not intend to confer such power;
5) There is a presumption that, if Parliament intends to interfere with fundamental rights or depart from the general system of law, it will express that intention with ‘irresistible clearness’. 30 However, there is no clear language in s 227 that Parliament intended the Commission to have the power to interfere with fundamental rights of the employers and employees covered by the Agreement, for example, the right not to be exposed to a civil penalty for conduct that was lawful at the relevant time or the right of employees to be paid in accordance with a legally enforceable industrial instrument;
6) In the absence of any provisions addressing the obvious potential consequences of a decision to retrospectively terminate an enterprise agreement, the object of the Act that seeks to encourage enterprise-level collective bargaining (see s 3(f)) and the object of Part 2-4 to provide for a ‘simple, flexible and fair framework that enables collective bargaining in good faith’ (s 171), would be compromised. This is because there would be no certainty that agreed terms would continue to apply after the nominal expiry date until a new agreement is made and there would be no fairness in either allowing for the termination of an expired enterprise agreement with retrospective effect in the absence of provisions addressing the consequences of this, such as an exposure to civil penalties for conduct that was lawful at the relevant time or the application of new employment regulation to the past in the absence of exceptional circumstances. 31
[23] These considerations provide a sound basis for the conclusion that there is no power for the Commission to terminate an enterprise agreement with retrospective effect and we agree with the Deputy President’s conclusion that even if there were power under s 227 for the Commission to specify that the termination of an enterprise agreement commences from a date that is in the past, it should be exercised with caution, and only in exceptional circumstances. As was observed by the Deputy President, this would be consistent with s 577, which requires the Commission to exercise its powers in a manner that is ‘fair and just’, and s 578, which states that when performing functions or exercising powers under the Act, the Commission must take into account not only the object of the Act and of the relevant Part of the Act, but also ‘equity, good conscience and the merits of the matter.’
[24] However, our views in relation to s 227 do not alter our conclusions in relation to s 225 outlined above.
[25] Accordingly, we note that the Respondent had standing to make the Application as he was an “employee covered by the agreement” pursuant to s 225(b) of the Act. The Respondent’s dismissal on 19 November 2019 did not thereafter bring the Commissioner’s jurisdiction to consider the Application under s 226 to an end. The Order made on 13 August 2020 was not made in excess of jurisdiction and therefore appeal ground one fails.
Appeal ground two
[26] Appeal ground two contended that the Deputy President had regard to an irrelevant consideration or misapplied s 226(b)(i) of the Act in the Decision by taking into account the views of the Respondent, who was, at that stage no longer an employee covered by the Agreement. The ACTU relied on the Respondent’s submissions in relation to grounds 2 and 3 of the appeal.
[27] Appeal ground two is made out on two bases. Between [51]-[56] in the Decision, the Deputy President makes reference to the views of the Respondent under the heading “S.226(b)(i) - Views of the employees, employer, and any employee organisation covered by the Agreement”. The Respondent was not, at the time of the second and third hearing (13 February 2020 and 22 July 2020 respectively) nor at the time the Decision and Order were issued, an employee of the Appellant who was covered by the Agreement. Accordingly, as an ex-employee, the Respondent was not “a person whose views fell expressly within the class of persons set out at s.226(b)(i)” 32. We see no basis upon which the Deputy President should have taken into account the views of the Respondent under s 226(b)(i) of the Act.
[28] Second, in any event, that the Deputy President did not distinguish his consideration of the views of employees from that of his consideration of the Respondent’s evidence, means that the Full Bench is unable to discern how the Respondent’s evidence was taken into account under s 226(b) of the Act. This is clear when the Deputy President’s observations at [51]-[56] are read together with the Deputy President’s observation at [77] that regard was had “to all of the material and evidence provided” and “the views of the employer and employees who expressed a view”. We are unable to assess the weighting ascribed by the Deputy President to the Respondent’s views; the Deputy President did not make a direct finding about the substance of the Respondent’s evidence in the context of his consideration of the evidence before him. The inability for the Full Bench to disaggregate the evidence taken into account by the Deputy President gives rise to appellable error.
[29] The Respondent contended that the Deputy President was entitled to take into account the Respondent’s evidence in evaluating whether it was appropriate to terminate the Agreement in the broader context of taking into account “all the circumstances”. Whilst we agree that it was open for the Deputy President to consider such evidence in this context, the Full Bench cannot disaggregate from the Decision what weight the Deputy President ascribed to the Respondent’s evidence or how such evidence was considered. Having regard to the way in which the Deputy President aggregated the evidence and made his conclusion, the Full Bench is unable to determine what weight the Deputy President gave to the evidence of the Respondent and whether it was appropriate. For the above reasons, appeal ground two is made out.
Appeal ground three
[30] Appeal ground three was that the Deputy President at [78] in the Decision asked the wrong question or misapplied s 226(b) of the Act. In the Decision, the Deputy President stated:
“The requirements of s.225 of the FW Act have been met and there is no evidence before me that indicates that, on the approach endorsed by the Full Bench of the Commission in Kellogg, and enunciated in Aurizon, it would not be appropriate taking into account all the circumstances including those listed at s.226(b)(i) and (ii) of the FW Act to terminate the Agreement.” [emphasis added]
[31] The test set out in s 226(b) of the Act provides that the Commission must terminate the agreement if “the FWC considers that it is appropriate to terminate the agreement taking into account all the circumstances…”. This subsection requires a positive finding that termination is appropriate in the circumstances. We accept the Appellant’s submission that the Deputy President at [78] in effect framed the test as assigning the onus upon the objector to prove that it is not appropriate to terminate the Agreement, rather than placing the onus on the relevant applicant to make out their application.
[32] It is clear that the Deputy President applied the wrong test at [78] in the context of his conclusions in the Decision. As the Full Bench rightly observed in Greg Rogowsky; Nigel Willis v Western Australian Meat Marketing Co-operative Limited T/A WAMMCO International 33 it is “critical that the requirements set out in the Act are accurately and consistently applied” 34. Accordingly, as the test applied by the Deputy President at [78] amounts to a misapplication of the law, appeal ground three has been made out.
Permission to appeal
[33] Having regard to the above, we are satisfied that the appeal enlivens the public interest. The Appellant has identified, appellable errors of law within the Decision. It is in the public interest to ensure that the requirements of the Act in the context of terminating enterprise agreements are properly considered, administered and applied in each matter. Appellate intervention is both warranted and necessary to examine the identified errors and allow the re-determination of the Application.
Conclusion
[34] We have read the Decision fairly and as a whole and considered all of the materials filed by the parties. The errors of law warrant the quashing of the Deputy President’s Decision and Order.
[35] We therefore find it appropriate to remit the Application to Deputy President Bull for re-determination.
[36] We order as follows:
• Permission to appeal is granted.
• The Appeal is upheld.
• The Decision ([2020] FWCA 4265) and Order (PR721809) are quashed.
• The Application is remitted to Deputy President Bull for redetermination.
VICE PRESIDENT
Mr S Wood of Queen’s Counsel and Mr M Easton of Counsel on behalf of the Appellant
Mr R Reed of Counsel on behalf of the Respondent
Ms S Ismail on behalf of ACTU
Hearing details:
2020.
Via videoconference:
19 November.
Printed by authority of the Commonwealth Government Printer
<PR725808>
1 David Mapledoram v ACES (Permanent Employees) Enterprise Agreement 2007 [2020] FWCA 4265 (the Decision).
2 PR721809.
3 AC307851.
4 Decision [3].
5 PR724481.
6 Respondent’s submissions, paragraph [47].
7 Decision [8].
8 Decision [9].
9 Decision [4]-[7].
10 Decision [8]-[41].
11 Decision [50].
12 Decision [68].
13 Decision [73].
14 Decision [73].
15 Decision [78].
16 PR721809.
17 Decision [82].
18 See inter alia, Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381 [69] per McHugh, Gummow, Kirby and Hayne JJ; Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at 31 [4] per French CJ, 46-47 [47] per Hayne, Heydon, Crennan and Kiefel JJ; Certain Lloyd's Underwriters v Cross (2012) 248 CLR 378 at 389 [24], 391 [30]-[31] per French CJ and Hayne J, 411-412 [88]-[89] per Kiefel J.
19 Fair Work Act 2009 (Cth) s 238(4)(a).
20 [2018] FWC 1282
21 Transcript PN 32.
22 Citing section 768AX(7) of the Fair Work Act 2009 (Cth), which provides that a variation of a copied State instrument “operates from the day specified in the variation, which may be a day before the variation is made”.
23 Fair Work Act 2009 (Cth) ss 165(2), 167.
24 Appellant’s submissions on the power to terminate an enterprise agreement retrospectively dated 17 November 2020.
25 Respondent’s submissions on the Commission’s power to retrospectively terminate an enterprise agreement dated 25 November 2020.
26 [2019] FWCA 8563.
27 (1998) 194 CLR 355.
28 Ibid at 381.
29 [2019] FWCA 8563 at [37].
30 Saeed v Minister for Immigration and Citizenship (2010) 241 CLR 252 at 259.
31 [2019] FWCA 8563 at [38] – [47].
32 Appellant’s submissions, paragraph [21].
33 [2019] FWCFB 4073.
34 Ibid at [26].
2