Australian Education Union v Council of the Western Melbourne Institute of TAFE
[1998] FCA 816
•14 JULY 1998
FEDERAL COURT OF AUSTRALIA
INDUSTRIAL LAW – whether breach of Award – Award limitation on maximum number of teaching duty hours – pro-rata calculation of maximum in relation to employees employed for less than the full teaching year – appropriate formula to calculate pro–rata maximum -whether appropriate to impose penalty.
Federal Court of Australia Act 1976 (Cth), s 18AC
Workplace Relations Act 1996 (Cth), s 178
TAFE Teachers’ Conditions of Employment (Victoria) Interim Award 1994
AUSTRALIAN EDUCATION UNION v COUNCIL OF THE WESTERN MELBOURNE INSTITUTE OF TAFE
VG 258 of 1997
MARSHALL J
MELBOURNE
14 JULY 1998
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
VG 258 of 1997
BETWEEN:
AUSTRALIAN EDUCATION UNION
APPLICANTAND:
COUNCIL OF THE WESTERN MELBOURNE INSTITUTE OF TAFE
RESPONDENTJUDGE:
MARSHALL J
DATE OF ORDER:
14 JULY 1998
WHERE MADE:
MELBOURNE
THE COURT ORDERS THAT:
It is declared that the respondent has committed a breach or non-observance of cl. 3.6.1 of the TAFE Teachers’ Conditions of Employment (Victoria) Interim Award 1994 (“the Award”) by failing to pay to Ms Gabriella Pretto for teaching duty hours worked by her in excess of her maximum teaching duty hours. .
It is declared that the respondent has committed a breach or non-observance of cl. 3.6.3 of the Award by failing to make the payment required by cl. 3.6.1 of the Award within a fortnight following the roster period in which such excess hours were worked.
Pursuant to ss 178(6) and 179A(1) of the Workplace Relations Act 1996 (Cth) (“the Act”) the respondent shall pay to Ms Gabriella Pretto the sum of $2,564.96 plus $394.02 interest within 21 days of the making of this order.
Pursuant to s 178(1) of the Act a penalty of $200 is imposed on the respondent in respect of the breach of the Award referred to in paragraph 1 hereof.
Pursuant to s 178(1) of the Act, a penalty of $50 is imposed on the respondent in respect of the breach of the Award referred to in paragraph 2 hereof.
Pursuant to s 356(b) of the Act, each such penalty referred to in paragraph 4 and 5 hereof be paid to the applicant within 21 days of the making of this order.
Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
VG 258 of 1997
BETWEEN:
AUSTRALIAN EDUCATION UNION
APPLICANTAND:
COUNCIL OF THE WESTERN MELBOURNE INSTITUTE OF TAFE
RESPONDENT
JUDGE:
MARSHALL J
DATE:
14 JULY 1998
PLACE:
MELBOURNE
REASONS FOR JUDGMENT
This matter is a review pursuant to s 18AC of the Federal Court of Australia Act 1976 (Cth) of the exercise of a power delegated to a judicial registrar. On 12 November 1997, the judicial registrar dismissed an application by the applicant, Australian Education Union (“the Union”). The application, made pursuant to s 178 of the Workplace Relations Act 1996(Cth) (“the Act”), alleged breach of the TAFE Teachers’ Conditions of Employment (Victoria) Interim Award 1994 (“the Award”) by the Council of Western Melbourne Institute of TAFE (“Western Melbourne”). The Union is an organisation of employees registered under the Act and a party bound by the Award. Western Melbourne is a body corporate under the Vocational Education and Training Act 1990 (Vict) and a party bound by the Award. The application is brought by the Union in respect of alleged underpayments of wages to its member Ms Gabriella Pretto, regarding work performed by her for Western Melbourne. The application seeks the imposition of penalties on Western Melbourne and orders directing that Western Melbourne pay to Ms Pretto the quantum of the alleged underpayment with interest.
FACTUAL BACKGROUND
The essential facts in this matter are not in dispute:
Western Melbourne employed Ms Pretto as a teacher in its Department of Computer Studies for a period of 44.4 weeks from 26 February 1996 until 31 December 1996.
Ms Pretto’s classification, pursuant to Div 1, Part 2 of the award, was “Teacher Sub-Division 6”. She was thereby entitled to a pro-rata annual salary of $42,248.00 and an hourly rate of pay of $21.30.
During her employment with Western Melbourne Ms Pretto accrued an entitlement to, and was required to take, 3.4 weeks annual leave. She was also entitled to 8 public holidays.
Ms Pretto performed teaching duties over a period of 39.4 weeks. Her actual teaching duty hours were 708.
THE AWARD
Clause 3.4.2(2) of the Award provides for a maximum number of teaching duty hours in the following terms:
“The maximum teaching duty hours shall be 800 hours per year (pro rata for part-time or employment for less than the full teaching year).”
There is no dispute between the parties about the number of hours which constitute “the full teaching year”. The relevant number is 1,748. It is arrived at as follows:
52 weeks represents a full calendar year.
From 52 weeks deduct 4 weeks annual leave and 2 weeks of public holidays leaving 46 weeks.
46 weeks multiplied by 38 hours equals 1,748 hours.
Ms Pretto was employed full-time but for a period of time less than the full teaching year, that is, less than 1,748 hours. Consequently, her maximum teaching duty hours are less than 800. The issue in dispute is how much less ?
PRO-RATA FOR EMPLOYMENT FOR LESS THAN THE FULL TEACHING YEAR
The question for determination in this matter is the meaning of the words “pro-rata for... employment for less than the full teaching year”. This question must be determined having regard to the evident intent of the phrase. The phrase is intended to provide an arrangement whereby, part-time teachers or teachers engaged for less than a full teaching year, have a lower maximum number of teaching duty hours compared to full time teachers engaged for a full teaching year.
The use of the word “pro-rata” is indicative of a figure proportionate to the figure for a full teaching year. As indicated above the figure for a full teaching year is 1,748 hours. This means that a teacher employed for 52 weeks is treated as having a full teaching year of 46 weeks; six weeks being excluded for leave and public holidays.
The parties accept the figure of 1,748 hours as the appropriate denominator in the formula for the calculation of pro rata maximum teaching duty hours for persons employed for less than a full year. There remains a dispute as to the appropriate numerator. Counsel for the Union, Ms Melinda Richards, contended that the appropriate numerator should be calculated by deducting from the total period of employment annual leave and public holiday entitlements. In Ms Richards’ written outline of argument, the following submission was made to the Court:
“The Applicant contends that a teacher’s maximum teaching duty hours “pro-rata for … employment for less than the full teaching year” are to be calculated by dividing the teaching year for which a teacher is employed by the full teaching year. This involves identifying the period during a teacher’s period of employment during which the teacher may be required to teach, taking into account annual leave and public holidays. That period is then divided by the full teaching year, and the teacher’s maximum teaching duty hours are reduced proportionately.” [emphasis added]
Counsel for Western Melbourne, Mr Michael McDonald contended that it was impermissible, to calculate the relevant numerator, by deducting annual leave and public holidays from the total period of employment. Mr McDonald’s submission focused on the use of the term “employment” in the phrase “pro-rata for … employment for less than the full teaching year”. He submitted that the reference to “employment”, requires the relevant numerator to include annual leave and public holidays, as the employment relationship subsists during such leave and holiday periods.
I do not accept Mr McDonald’s submission. The construction of the clause which he urged upon the Court is too narrow. It focuses excessively on the use of the term “employment” without regard to the context in which it is used. Central to that context are the words “pro-rata” and “less than the full teaching year”. A consideration of the entirety of the words in the relevant sub-clause supports the interpretation favoured by the Union. The full teaching year having been made the basis for the proportionate assessment and that period having included a deduction for annual leave and public holidays, in my view, it follows that the numerator in the equation, must also take into account relevant periods deducted for annual leave and public holidays.
The construction which I accept involves a comparison of like with like, by identifying the teaching year for which a teacher is employed as a proportion of the whole teaching year. Furthermore, it avoids an absurd consequence. The vice in the construction proposed by Western Melbourne is that a teacher employed for a 46 week period, for example, from mid February to late December, would have the same maximum teaching duty hours as a teacher employed from 1 January to 31 December. Such a result would render otiose the word “pro-rata” in cl 3.4.2(2) of the Award. Such a consequence could not have been intended by the framers of the Award, that is, the parties who consented to its making by the Australian Industrial Relations Commission.
It follows, that a teacher, in the position of Ms Pretto, engaged for 44.4 weeks from late February to late December, should have excluded from that period, for the purpose of calculating the relevant “pro-rata” teaching year, 3.4 weeks annual leave and eight public holidays. This leaves a figure of 39.4 weeks. Accordingly, calculation of the pro rata maximum teaching duty hours of Ms Pretto, pursuant to clause 3.4.2(2), should occur as follows:
· 39.4 weeks multiplied by 38 hours equals 1,497.2 employment hours.
· 1,497.2 divided by 1,748 equals .85652.
· .85652 x 800 equals, rounded off, 685.22 hours.
Consequently, cl 3.4.2(2) of the Award allowed Ms Pretto to perform, in the period from 26 February 1996 until 31 December 1996, a maximum number of teaching duty hours of 685.22 hours.
CALCULATION OF MS PRETTO’S ACTUAL TEACHING DUTY HOURS
Ms Pretto’s actual face to face teaching duty hours were 708. In addition it is not in dispute that she is to be credited with a curriculum allowance of 57.5 hours. This makes a total of 765.5 hours. It can be seen that Ms Pretto’s actual duty hours exceeded her maximum teaching duty hours by 80.28 hours.
CALCULATION OF UNDERPAYMENT
It was not disputed by Western Melbourne that if Ms Pretto’s actual duty hours exceeded her maximum teaching duty hours by 80.28 hours, Ms Pretto was entitled pursuant to clause 3.6.1 of the Award to an amount of $2,564.96. That sum represents 80.28 hours multiplied by a penalty rate of one and a half times Ms Pretto’s $21.30 hourly rate.
In her written outline of argument, Ms Richards submitted that:
“The Applicant also seeks an order that Ms Pretto be paid interest on the amount owing, under section 179A of the Act. The appropriate rate of interest is 10.5% per annum, the rate prescribed by Order 35, rule 8 of the Federal Court Rules in respect of judgment debts. The Respondent should have paid Ms Pretto for her excess teaching duty hours by, at the latest, 31 December 1996. Interest calculated at 10.5% per annum from 1 January 1997 to 19 June 1998 is $394.02.”
Mr McDonald did not contend to the contrary. I see no reason why interest in the amount sought should not be granted.
PENALTY
Ms Richards submitted that a penalty should be imposed on Western Melbourne, “although not a large one”. Mr McDonald submitted that no penalty should be imposed as the relevant interpretation was not free from doubt. Mr McDonald made good his point by referring to the judgment of the judicial registrar which led to the order subject to review, that is, a dismissal of the proceeding. In my view, a penalty should be imposed, as refusal to impose a penalty may be seen as tolerance by the Court of award breaches. Further, such a refusal would fail to recognise the important role of registered organisations in ensuring award compliance and attempting to recover some or all of any penalty so imposed.
At the time when the breaches of the Award occurred, a $1000 penalty was the statutory maximum the Court could impose in application brought under s 178 of the Act. Having regard to this limit, and the concession made by the Union that the numerous breaches of cl. 3.6.1 of the Award must be treated as single breach for the purpose of s 178(2) of the Act, it is appropriate that a penalty of $200 be imposed for Western Melbourne’s failure to properly pay Ms Pretto in respect of teaching duty hours performed in excess of her maximum teaching duty hours. A further $50 penalty will be imposed for breach of cl. 3.6.3 which requires Western Melbourne to make payment for excess hours in the fortnight following the roster period in which those hours were worked. It is appropriate that the penalties imposed by this judgment be paid to the Union pursuant to s 356(b) of the Act.
ORDERS
The orders of the Court are as follows:
It is declared that the respondent has committed a breach or non-observance of cl. 3.6.1 of the TAFE Teachers’ Conditions of Employment (Victoria) Interim Award 1994 (“the Award”) by failing to pay to Ms Gabriella Pretto for teaching duty hours worked by her in excess of her maximum teaching duty hours. .
It is declared that the respondent has committed a breach or non-observance of cl. 3.6.3 of the Award by failing to make the payment required by cl. 3.6.1 of the Award within a fortnight following the roster period in which such excess hours were worked.
Pursuant to ss 178(6) and 179A(1) of the Workplace Relations Act 1996 (Cth) (“the Act”) the respondent shall pay to Ms Gabriella Pretto the sum of $2,564.96 plus $394.02 interest within 21 days of the making of this order.
Pursuant to s 178(1) of the Act a penalty of $200 is imposed on the respondent in respect of the breach of the Award referred to in paragraph 1 hereof.
Pursuant to s 178(1) of the Act, a penalty of $50 is imposed on the respondent in respect of the breach of the Award referred to in paragraph 2 hereof.
Pursuant to s 356(b) of the Act, each such penalty referred to in paragraph 4 and 5 hereof be paid to the applicant within 21 days of the making of this order.
I certify that this and the preceding six (6) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Marshall
Associate:
Dated: 14 July 1998
Counsel for the Applicant: Ms Melinda Richards Solicitor for the Applicant: Maurice Blackburn & Co Counsel for the Respondent: Mr Michael McDonald Solicitor for the Respondent: Minter Ellison Date of Hearing: 19 June 1998 Date of Judgment: 14 July 1998
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