Australian Federation of Air Pilots on behalf of Nathan Hayes v Eastern Australian Airlines Pty Limited T/A Qantaslink

[2016] FWC 5918

[2016] FWC 5918

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739 - Application for the Fair Work Commission to deal with a dispute in accordance with a Dispute Settlement Procedure

Australian Federation of Air Pilots on behalf of Nathan Hayes
v
Eastern Australian Airlines Pty Limited T/A Qantaslink
(C2015/4601)

COMMISSIONER CAMBRIDGE SYDNEY, 26 AUGUST 2016

Dispute settlement procedure - interpretation of terms of enterprise agreement - disputed terms dealing with payments for earlier commencement time after a designated day off - jurisdictional barrier identified - ambiguity established - interpretation of terms provided.

[1] This Decision is made in respect of an application that was taken under section 739 of the Fair Work Act 2009 (the Act) for the Fair Work Commission (the Commission) to deal with a dispute in accordance with a Dispute Settlement Procedure (DSP). The application was lodged at Melbourne on 3 July 2015, and it was made by the Australian Federation of Air Pilots (the AFAP), on behalf of Nathan Hayes, and taken against Eastern Australian Airlines Pty Limited T/A Qantaslink (the employer or Qantaslink).

[2] The Commission was empowered to deal with this matter by virtue of a DSP which can be found at clause 10 of the Eastern Australian Airlines Pty Limited Pilots Enterprise Agreement 2010 (the 2010 Agreement). However, on 7 October 2015, the 2010 Agreement was replaced by the Eastern Australian Airlines Pty Limited Pilots Enterprise Agreement 2015 (the 2015 Agreement). Although the 2015 Agreement contained a DSP in identical terms to that contained in the 2010 Agreement, there was no evidence that the circumstances of the dispute which gave rise to the application, continued to occur, and had been advanced through the procedural requirements of the DSP contained in the 2015 Agreement.

[3] Therefore, by way of application of the authority established by the Decision of the Full Bench of the AIRC in Stephenson v Abetz (Stephenson), 1 the Commission does not have the powers of private arbitration required to be able to make a binding determination of the application. This jurisdictional impediment appeared to have escaped attention before it was raised formally with the Parties at the commencement of the scheduled Hearing on 17 May 2016. Notwithstanding the jurisdictional impediment, the Parties wished to have the matter proceed to Hearing as had been programmed.

[4] The application was the subject of unsuccessful conciliation proceedings held on 24 August 2015, and 8 February 2016, before Cribb C. The matter was subsequently reallocated to the Commission as constituted, for the purposes of arbitration which involved a Hearing conducted in Sydney on 17 May 2016.

[5] At the Hearing, the named applicant, Nathan Hayes, was represented by Ms C Larkins from the AFAP. Ms Larkins introduced evidence by way of witness statements of the applicant, Mr Hayes, and also of a Mr Robert Lukman. In addition, Ms Larkins called Mr Simon Lutton who provided evidence as a witness.

[6] The employer was represented by Mr S Woodbury, solicitor from Ashurst Australia solicitors for the employer. Mr Woodbury called Mr Adrian Young as a witness, who provided evidence in elaboration of a statement that he had made for these proceedings.

[7] Ms Larkins and Mr Woodbury both made oral submissions in elaboration of documentary material that each had filed on behalf of the respective Parties.

Background

[8] There was essentially no factual contest between the Parties about the circumstances which gave rise to the dispute in this matter.

[9] The applicant is a pilot employed by Qantaslink who was rostered on a designated day off on 20 November 2014. The roster issued to the applicant indicated that he was scheduled to commence duties at 0945 on 21 November 2014. However, prior to the commencement of this duty, the applicant was contacted by the employer and he was requested to commence duties at 0535 on 21 November 2014. The applicant agreed to the earlier commencement time of 0535.

[10] The applicant believed that he would be paid double time for the time worked on 21 November 2014, as he had agreed to a start time before 0600 hours on the day following his designated day off, and this represented working on a designated day off, for which the 2010 (and 2015) Agreements prescribed payment at the rate of double time. The employer rejected any entitlement to double time payment to the applicant for work on 21 November 2014, but instead paid an extension allowance which it considered to be the appropriate payment in the circumstances involving the earlier start of the applicant.

[11] Therefore, the dispute has involved a contest as to the particular entitlement which should be paid to any pilot who agrees to commence work earlier than 0600 on a day after a designated day off. The Parties agreed that the resolution of the dispute involved the Commission making a determination of the following question:

“In an instance where, immediately following a designated day off (per the definition at clause 8.12), an employee consents to a change of his or her roster such that their new sign on time is between the hours of 0500 and 0600, does this attract payment under clause 41.8 of the Eastern Australia Airlines Pty Limited Pilots Enterprise Agreement 2015?”

[12] The answer to this question has involved an examination of the various terms contained within the 2010 Agreement, which are replicated in the 2015 Agreement, and which deal with, inter alia; the definition of a designated day off; rostering arrangements; payments in respect to changes to duty; and payments in respect to working on a designated day off. The question is answered by providing the correct construction for the various terms of the Agreements under examination.

The AFAP Case

[13] In short summary, the AFAP has asserted that the relevant provisions of the Agreements require Qantaslink to pay any employee who agrees to commence duty before 0600 on a day following a designated day off, at the rate of double time for that day because such commencement before 0600, involves work on the designated day off. This construction, as contended for by the AFAP, was primarily advanced on the basis of the definition of a designated day off (cl. 8.12) which encompassed a period until 0600 hours on the day following a designated day off.

[14] Ms Larkins from the AFAP, made submissions which identified the relevant contested terms contained in the Agreements, and in particular, the words contained in subclauses 8.12, 41.2.15 and 41.8.2 were analysed. Ms Larkins asserted that by way of application of relevant principles for interpretation, these words establish an entitlement for payment of double time when an employee agrees to commence earlier than previously rostered on a day following a designated day off, and the earlier commencement time is altered to before 0600.

[15] The submissions made by Ms Larkins referred to the negotiations which occurred as part of the bargaining that led to the making of the 2010 Agreement. According to the submissions of Ms Larkins, there was a common intention of the parties to include terms in the 2010 Agreement which provided for the rostered commencement of duty between 0500 and 0600 on the day after a designated day off. Ms Larkins submitted that this change provided for improved flexibility for the employer to roster a commencement time before 0600 on a day following a designated day off. However, Ms Larkins said that as there was no alteration to subclause 8.12 which provided for the definition of a designated day off, in circumstances where a pilot agreed to commence before 0600, the payment of double time for working on a designated day off remained applicable.

The Employer’s Case

[16] Mr Woodbury appeared for Qantaslink, and he made submissions which rejected the interpretation of the contested terms of the Agreements, as was advanced by the AFAP. Mr Woodbury acknowledged that the Parties were broadly agreed on the correct principles which should apply to the contested interpretation of the words contained in the various clauses of the Agreements. However, Mr Woodbury said that when properly considered in context, the relevant words did not provide for an entitlement to payment of double time in circumstances where a pilot had agreed to a commencement time before 0600 on a day following the designated day off.

[17] The submissions made by Mr Woodbury asserted that the correct interpretation of the contested provisions meant that a pilot who agreed to an earlier commencement time, which was before 6 am on the day following a designated day off, was entitled to payment of an extension allowance as provided for in subclause 41.6.2 of the Agreements, but not double time as asserted by the AFAP.

[18] According to the submissions made by Mr Woodbury, the construction of the relevant terms of the Agreements as was urged by the AFAP, would involve a rewriting of various clauses to enable the payment of double time as was claimed. Mr Woodbury asserted that when a change to the commencement time occurs by agreement within 48 hours of the rostered commencement time, then the relevant terms are those contained in subclause 41.6.2 of the Agreements. Mr Woodbury submitted that the terms contained in subclause 41.6.2 of the Agreements were directly relevant to the particular circumstances of the applicant, whereby the employer correctly paid him an extension allowance to compensate for the inconvenience of a late change to his roster.

[19] Mr Woodbury submitted that when the relevant clauses of the Agreements were read together and properly understood in terms of their context, the circumstances where a pilot was rostered to commence between 5 am and 6 am would attract no additional payment. However according to Mr Woodbury, when a late change to the commencement time was agreed, and the commencement time then altered to between 5 am and 6 am, the relevant terms of the Agreements provided for payment of the extension allowance, not payment at the rate of double time.

[20] It was submitted by Mr Woodbury that there was a plain and ordinary meaning for the contested terms of the Agreements. Mr Woodbury said that when the actual words used were examined and considered in terms of the context and purpose for which they were intended, in circumstances which were not compulsory or obligatory, and the pilot accepted the change for the earlier commencement of duty, the extension allowance was applicable.

[21] Consequently, it was submitted by Mr Woodbury that upon the proper application of the relevant principles for construction of enterprise agreements involving, first and foremost, a focus upon the language of the agreement itself, there was no ambiguity in the words in the Agreements and they should be given their plain and ordinary meaning. Mr Woodbury submitted that the proper construction to be given to the contested terms of the Agreements would lead to the answer to the question posed in this instance to be “no”. That is, a pilot who agrees to an earlier commencement time before 0600 on a day following a designated day off, would not be entitled to payment at the rate of double time under subclause 41.8 of the Agreements.

Consideration

[22] The dispute in this instance has involved a contest regarding the correct interpretation or construction that should apply to particular terms of the Agreements. In the particular circumstances of this case, the Commission is jurisdictionally barred from making any binding determination. However, at the request of the Parties, I have proceeded to hear the matter, and provide a determination which may be of some assistance to the Parties.

[23] The approach to resolving questions of contested interpretation/construction of the terms contained in an enterprise agreement has been the subject of a significant Decision of a Full Bench of this Commission in the matter of The Australasian Meat Industry Employees Union v Golden Cockrell Pty Limited  2 (Golden Cockerel). Both Parties acknowledged and referred to the Golden Cockrell Decision and in particular, the principles set out at paragraph 41 of that Decision and which, for present purposes, do not require repeating.

[24] Further, it is relevant to acknowledge the additional guidance provided by, inter alia, firstly; the Full Bench Decision in Essential Energy v Australian Municipal, Administrative, Clerical and Services Union and Others  3 (Essential Energy) and, secondly; the Judgement of Madgwick J in Kucks v CSR Limited 4 (Kucks).

[25] Accordingly, the principles as established by the Full Bench Decisions in Golden Cockerel and Essential Energy have been adopted, and relevantly applied in this instance to the contested construction of the terms of the Agreements. Further, the approach to the interpretation of the terms of the Agreements has been undertaken cognisant of the guidance provided by various Judgments including that in Kucks.

The Relevant Clauses

[26] There are various clauses of the Agreements which have some bearing upon the determination of the contested construction question which has arisen in this instance. It is helpful to set out the particular terms of the relevant clauses. Firstly, subclause 8.12 relevantly states:

“8.12. Designated day off means except as specified elsewhere in this agreement a day on which the pilot is rostered to be free of all duty at home base or temporary transfer which must extend from 2200 hours on the previous day until 0600 hours on the following day.”

[27] Subclause 8.12 unambiguously provides a general definition for a designated day off, and it anticipates that some exception to that general definition may be specified elsewhere in the Agreement. The general definition of a designated day off as provided for by subclause 8.12, confirms and reflects the historical prohibition upon any commencement time before 0600 on a day following a designated day off.

[28] Secondly, particular subclauses of Clause 41.2 ROSTERING PROVISIONS, are relevant, and subclauses 41.2.14 and 41.2.15 are in the following terms:

“41.2.14. Subject to Clause 41.2.15, a pilot will not be rostered for a tour of duty terminating after 2200 hours on the day preceding the designated day or days free of duty, and shall not be rostered to commence duty prior to 0600 hours on the day following the day/days free of duty. In the case of a single designated day off a pilot shall have a minimum of 36 hours free of planned duty, reducible to 32 hours due to operational disruption with no penalty to the company unless the hours are less than 32. These duty free hours will in each case embrace the core hours described in this clause.

41.2.15. A pilot may be rostered for duty commencing from 0500 hours on the day after the designated day or days free of duty. In this circumstance, the pilot shall not be rostered to complete duty after 2100 hours on the day immediately preceding the day or days free of duty. In the case of a single designated day off a pilot shall have a minimum of 36 hours free of duty.”

[29] Subclause 41.2.14 contains words which operate as the historical prohibition upon rostering of a pilot for duty to commence prior to 0600 on a day following a designated day off. Subclause 41.2.15 was first introduced as part of the negotiations for the 2010 Agreement, and it provides for the flexibility to permit the rostering of a pilot for duty prior to 0600 (but not before 0500), on a day following a designated day off. This subclause was a significant change to the historical prohibition upon any commencement before 0600 on a day following a designated day off.

[30] Thirdly, subclause 41.6.2 of the Agreements provides for payment of an extension allowance when the previously rostered duty of a pilot is altered by mutual consent within 48 hours of the commencement of a rostered duty. Subclause 41.6.2 is in the following terms:

“41.6.2. When any changes occur within 48 hours of sign on and the pilot's sign on becomes more than one hour earlier, or the pilot's actual sign off becomes more than one hour later than original roster sign on/sign off times, then the pilot will be paid an extension allowance in accordance with clause 40.1. This payment is not applicable to a pilot who accepts extra duty and is paid under clause 41.8 of the Agreement, or is called for duty on a designated reserve day within the designated reserve period. The payment is not applicable if a pilot's rostered duty is changed to a day off. All changes to a pilot's rostered duties must be by mutual consent, except in accordance with Clause 41.3.8.”

[31] It is relevant to note that the second sentence of this subclause makes a distinction with payments to a pilot who accepts “extra duty” and is paid under subclause 41.8 of the Agreements. It should be noted that “extra duty” is not defined or otherwise clarified elsewhere in the Agreements. However, quite properly, it was agreed between the Parties that there could be no payment of an extension allowance, and also payment for working on a designated day off at the rate of double time prescribed by subclause 41.8.2 of the Agreements. The issue of contest was which one of the two payments, either extension allowance (cl. 41.6.2), or double time (cl. 41.8.2), should apply to an agreed alteration to a previous roster which involved commencement before 0600 on the day following a designated day off.

[32] Finally, subclause 41.8.2 provided the prescription for payment at the rate of double time when a pilot agreed to work on a designated day off. Subclause 41.8.2 of the Agreements is in the following terms:

“41.8.2. If a pilot agrees to work on a designated day free of all duty, then that pilot will be entitled to payment for the day worked at the rate of double time, and no substitute day off will be given.”

[33] It was subclause 41.8.2 of the Agreements which was advanced by the AFAP as the principal, operative terms of the Agreements which applied to the circumstances of the applicant when his previously rostered commencement time was, by consent, brought forward to before 0600 on the day following a designated day off. It was not argued that there was any distinction to be made between the terms a “designated day free of duty” and a “designated day off”.

The Question of Ambiguity

[34] The approach to resolving the contested construction question should logically commence with an examination of the relevant words, so as to discern whether or not these words contain some ambiguity. It is well established that the approach to resolving questions of contested construction should focus upon providing the words under examination with their plain and ordinary meaning, unless for some cogent reason such ordinary meaning is inappropriate and unavailable.

[35] In this instance, I believe that an ambiguity has arisen in respect to the particular terms “work on a designated day free of all duty” appearing in subclause 41.8.2 of the Agreements. The ambiguity has been created because the definition of a designated day off (cl. 8.12) has been fundamentally altered by the inclusion of subclause 41.2.15, which permits the rostering of a pilot to work at a time which would otherwise be captured by the general definition of a designated day off.

[36] Consequently, there is an unresolved tension between subclauses 41.2.15 and 41.8.2 with the former terms, (cl. 41.2.15) permitting ordinary time payment for rostered duty between 0500 and 0600, while the latter terms (cl. 41.8.2), when read in conjunction with the general definition of designated day off (cl. 8.12), stipulate payment at the rate of double time in respect of agreed duty performed at the same time, that is, commencement between 0500 and 0600 on a day following a designated day off, a.k.a. designated day free of all duty. The tension between these two subclauses establishes an ambiguity in respect of the words “work on a designated day free of all duty” appearing in subclause 41.8.2 of the Agreements.

[37] The ambiguity is further identified by the direct contradiction between the words “A pilot shall not be required to work on a designated day free of all duty” found in subclause 41.8.1, and the words “A pilot may be rostered for duty commencing from 0500 hours on the day after the designated day or days free of duty” which appear in subclause 41.2.15. Given that the definition of a designated day off stipulates the 0600 hours requirement, subclause 41.2.15 permits the employer to roster a pilot to commence from 0500 hours on the day after a designated day off, while subclause 41.8.1 says a pilot shall not be required to work at that time. In simple terms, one must ask, which of these subclauses prevails over the other?

Resolving the Ambiguity

[38] If the words “work on a designated day free of all duty” appearing in subclause 41.8.2 of the Agreements were given what might appear to be a plain and ordinary meaning, then, having regard for the definition of a designated day off, the work of a pilot on duty commencing from 0500 hours on the day after the designated day or days free of duty in accordance with subclause 41.2.15, would also attract payment at the rate of double time. The AFAP accepted that subclause 41.2.15 was introduced during the negotiations for the 2010 Agreement as a flexibility measure that permitted the employer to roster a pilot earlier than 0600 on the day following a designated day off. There was no suggestion that the introduction of this flexibility, which altered the historical proscription on commencement of duty before 0600, would involve payment at the rate of double time via the operation of subclause 41.8.2.

[39] Therefore, in order to resolve the identified ambiguity, the surrounding circumstances can be appropriately admitted as relevant factors for consideration. There was no contest that the removal of the historical prohibition on pilots commencing rostered duty before 0600 on a day after a designated day off, did not involve double time payment under subclause 41.8.2. As a matter of logic, why would there then be a double time payment introduced if a pilot agreed to an alteration to the rostered commencement time before 0600?

[40] If the construction of the terms of the Agreements as was urged by the AFAP was correct, then something of an absurd outcome would emerge. Contemplation of the following example is instructive:

● Pilot A was rostered to commence at say, 0535 on a day following a designated day off.

● Pilot B was rostered to commence at say, 0935 on a day following a designated day off.

● Pilot B agreed to bring forward her/his previously rostered commencement time to the same time as Pilot A, 0535.

● Both Pilot A and Pilot B commence duty at the same start time, 0535, following a designated day off.

● Pilot A had no option but to start at 0535.

● Pilot B agreed to start at 0535.

● Pilot A would not be considered to be working on a designated day off, and no additional payment would apply in respect to the 0535 start.

● Pilot B would be considered to be working on a designated day off, and payment of double time would apply in respect of the 0535 start.

[41] Consequently, when properly considered in the context of the text of the Agreements viewed as a whole, together with the disputed terms construct within the Agreements, and having regard for the logic that must apply to the circumstances surrounding the introduction of an earlier start time on a day following a designated day off, the ambiguity must be resolved against the construction advanced by the AFAP. It would seem that once the flexibility provided by subclause 41.2.15 permitted duty to commence from 0500 on a day following a designated day off, the definition of designated day off must depart from the historical restriction involving no start of duty before 0600.

Conclusion

[42] In this case, the application was made in respect to a DSP found in an Agreement which, subsequent to the filing of the application, no longer had any force or effect, that is, after 7 October 2015. Consequently, the Commission is not properly empowered to provide any binding determination of the application. Notwithstanding this jurisdictional impediment, the Parties have been provided with a determination of the contested aspects of the dispute.

[43] The determination of the dispute has involved a requirement to settle a contested construction question arising from particular terms contained in the Agreements. The contest has primarily focussed upon the terms contained in subclauses 8.12, 41.2.15, 41.6.2 and 41.8.2 of the Agreements. In particular, the Parties advanced competing propositions as to the construction that should be given to the words “work on a designated day free of all duty” appearing in subclause 41.8.2 of the Agreements.

[44] The competing propositions for construction of the terms of the Agreements have been evaluated and balanced. The contested terms of the Agreements have been examined having regard for evidence of surrounding circumstances, so as to determine whether an ambiguity exists.

[45] Upon analysis, and application of the principles for resolution of questions of contested construction as primarily established by the Golden Cockerel Decision, I have concluded that the disputed terms of the Agreements cannot be given a plain and ordinary meaning, and an ambiguity has been established.

[46] Upon an examination of the contested terms of the Agreements, the ambiguity that has been identified has been resolved in order to provide for the proper construction that should be given to, in particular, the words “work on a designated day free of all duty” appearing in subclause 41.8.2 of the Agreements. In summary, these words cannot be given a construction which would negate the practical consequences of the introduction of a flexibility which permitted commencement of duty earlier than the historically prescribed position of 0600.

[47] In view of the determination made as to the correct construction and interpretation that should be given to the contested terms of the Agreements, the answer to the question that the Parties have requested the Commission to arbitrate upon, is provided as follows;

In an instance where, immediately following a designated day off (per the definition at clause 8.12), an employee consents to a change of his or her roster such that their new sign on time is between the hours of 0500 and 0600, this circumstance does not attract payment under clause 41.8 of the Eastern Australia Airlines Pty Limited Pilots Enterprise Agreement 2015. Instead, this circumstance entitles the particular employee to payment of an extension allowance pursuant to subclause 41.6.2 of the Eastern Australia Airlines Pty Limited Pilots Enterprise Agreement 2015.

[48] The dispute is determined accordingly, and the application is dismissed.

COMMISSIONER

Appearances:

Ms C Larkins of the Australian Federation of Air Pilots appeared on behalf of the applicant.

Mr S Woodbury, solicitor from Ashurst Australia appeared for the employer.

Hearing details:

2016.

Sydney:

May, 17.

 1   Stephenson v Abetz [PR952743], (28 October 2004).

 2   The Australasian Meat Industry Employees Union v Golden Cockrell Pty Limited [2014] FWCFB 7447.

 3   Essential Energy v Australian Municipal, Administrative, Clerical and Services Union; Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia; The Association of Professional Engineers, Scientists and Managers, Australia [2015] FWCFB 1981.

 4 Kucks v CSR Limited [1996] IRCA 166 (19 April 1996), 66IR182.

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