Australian Federation of Air Pilots v Lloyd Helicopters Pty Ltd T/A CHC Helicopters (Australia)

[2016] FWC 6227

[2016] FWC 6227

FAIR WORK COMMISSION

DECISION

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

Australian Federation of Air Pilots
v
Lloyd Helicopters Pty Ltd T/A CHC Helicopters (Australia)
(C2016/4667)

VICE PRESIDENT WATSON MELBOURNE, 19 SEPTEMBER 2016

Alleged dispute about any matters arising under the enterprise agreement and the NES – Allowances – Jurisdiction to determine new allowance – Obligation under agreement to determine allowance for overseas operations – Approach to setting allowance – Fair Work Act 2009, s.739.

[1] This decision concerns an application for the Fair Work Commission (the Commission) to deal with a dispute. The application is made by the Australian Federation of Air Pilots (AFAP) under s.739 of the Fair Work Act 2009 (the Act) and concerns employees employed as pilots by Lloyds Helicopters Pty Ltd trading as CHC Helicopters (Australia) (CHC Helicopters). The dispute relates to the provisions of the CHC Helicopters (Australia) Pilots Enterprise Agreement 2013 – 2016 (the Agreement) regarding the amount of an allowance payable to a pilot that is required to travel to Stockholm, Sweden, to undertake flight simulation training.

[2] The matter was listed for conference on 2 August 2016. The parties were unable to reach a resolution and the AFAP requested that the matter be listed for arbitration. At the hearing of the matter Mr D Stephens appeared on behalf of the AFAP and Mr S Bakewell, agent, appeared on behalf of CHC Helicopters.

Jurisdiction

[3] The dispute comes to the Commission by way of the dispute settlement procedure in the Agreement. The clause relevantly provides:

“13.1 Procedures to Avoid Employee Grievances and Industrial Disputes

This procedure applies to Employee specific, workplace specific and Companywide issues. The procedure will be followed on all occasions until the matter is resolved…

…

13.3 Company Wide Issues

If an issue is raised at a workplace level or individual level which has Companywide implications, the following procedure will be followed: -

a. The nominated senior management representative(s) and the Employee representatives will meet and discuss the matter and seek to reach agreement. The parties shall, where practicable, meet within 72 hours of the dispute being notified.

b. If the matter is not agreed, the Employee representative can meet with the Human Resource Manager and discuss the issue. The parties shall, where practicable, meet within one (1) week of the Human Resource Manager being notified that the meeting between the management representative and the Employee representative has not resolved the matter

c. If the matter is unresolved and is in dispute the Employee or the Company may refer the matter to the FWC to settle any dispute that is:

• About any matters arising under this Agreement, and/or



• In relation to the application an operation of the NES

d. In dealing with a dispute under this clause, FWC shall initially attempt to settle the dispute by conciliation. If conciliation fails to settle the dispute, FWC may arbitrate the dispute.

…

13.6 Powers of FWC

13.6.1 The parties agree that FWC shall have the power to do all such things as are necessary for the just resolution of the dispute.

13.6.2 FWC shall be provided access to the workplace to inspect or view any work, material, machinery, appliance, article, document or other thing or interview any Pilot who is usually engaged in work at the workplace.

13.6.3 The parties agree that FWC may give all such directions and do all such things as are necessary for the just resolution and determination of the dispute. This may include but is not limited to:

a. if requested by either party, convening a conference;

b. informing her/himself on any matter relevant to the dispute and provide the parties with the source of the information and an opportunity to comment;

c. take evidence on oath or affirmation;

d. give directions orally or in writing in the course of, or for the purposes of, procedural matters relating to the proceeding;

e. compel the production of documents that relate to the dispute that are not commercially confidential or privileged (the parties may challenge before the Commission the veracity of any assertion regarding commercial confidentiality the privileged nature of any documents);

f. summoning any party to the dispute, witness or persons whose presence the arbitrator believes would help in the resolution or determination of the dispute;

g. determining the dispute in the absence of any party or person who has been notified of the dispute or who has been summoned to appear;

h. sit at any place;

i. conduct the proceeding, or any part of the proceeding, in private;

j. adjourn the proceeding to any time and place;

k. refer any matter to an expert and accept the expert's report as evidence;

l. allow the amendment, on any terms that it thinks appropriate, of any application or other document relating to the proceeding;

m. correct, amend or waive any error, defect or irregularity whether in
substance or form;

n. make interim decisions, and

o. make a final decision in respect of the matter to which the proceeding relates.

13.6.4 Where a matter is arbitrated, the process at arbitration shall be that the Applicant to the dispute will outline its case and present any evidence and then the Respondent shall outline its case and present any evidence. The Applicant will then close its case and then the Respondent will close its case. Wherever practicable, evidence will be given in the form of witness statements. The Applicant may then respond to any issues that arise from the Respondent's case that were not reasonably foreseeable to address at first instance.

13.6.5. In exercising its powers, the Commission shall act in accordance with the terms of this Agreement and the Act.”

The Questions for Determination

[4] The issue for determination in this case does not simply relate to the interpretation of the terms of the Agreement. Rather, the relevant clause of the Agreement (clause 26.2.3(c)), provides for the determination of a rate by agreement in specified circumstances. However, the parties do not agree on whether the clause applies. The first question therefore is whether the circumstances contemplated by clause 26.2.3(c) are present in this case. More specifically, the initial question is whether clause 26.2.3(c) applies to pilots that are required as part of their employment to travel to Stockholm, Sweden, to undertake flight simulation training.

[5] If it is determined that clause 26.2.3(c) does apply, it is clear that the parties are not in agreement as to the quantum of any allowance to be paid. The AFAP submits that there is therefore a dispute about the quantum of the allowance and this dispute needs to be resolved by a determination of the Commission.

Background Facts and Evidence

[6] The relevant facts of this matter are not in dispute.

[7] CHC operates a range of helicopters. Its pilots are regularly required to undertake simulator training for aircraft they will be required to operate. All of the simulators are outside Australia – at some 13 locations in Europe, North America, the Middle East and Asia.

[8] The AS332 helicopter was recently brought back into service because mechanical issues with another helicopter type have led to it being taken out of service for the time being.

[9] The flight simulator for the AS332 used to be located in Norway. It is now located in Stockholm, Sweden. The simulator is located near the Stockholm Arlanda Airport, around 40kms from central Stockholm. A free shuttle bus transports the pilots from the airport to the Radisson Blu Arlanda Hotel, ten minutes away where they are accommodated at CHC expense. Breakfast is included in the hotel tariff. The training centre is across the road from the hotel. Pilots are required to attend the simulator at various rostered times when the simulator is available. They are required to pay for their own lunch and dinner. There is a restaurant at the Radison Blu hotel. Other dining options are available at the airport, or further away in central Stockholm.

[10] Pilots are paid a Daily Travel Allowance (DTA) for travel to Stockholm under Clause 26.6 of the Agreement which provides as follows:

“26.6 Daily Travel Allowance (DTA)

26.6.1 An Employee on a tour of Duty Away will be paid a DTA in accordance with Schedule 4 per hour or part thereof, calculated for all time between departure from, until return to, the primary domestic airport in the Home Base city. DTA shall be paid under either of two (2) scales, determined by whether or not the Company supplied meals.

26.6.2 Notwithstanding sub-clause 26.6.1, the DTA will be calculated from the commencement of departure from the Home Base city or locality if there is no domestic airport for departure in the Home Base city or locality.”

[11] Clause 26.2.3 of the Agreement provides for overseas allowances as follows:

“26.2.3 Overseas Allowances

a. Employees who tour to East Timor will be entitled to an allowance per hour whilst in East Timor, in accordance with Schedule 4.

b. Employees who are required to travel to and remain overnight in Norway will be entitled to an additional Norway DTA Allowance whilst in Norway, in accordance with Schedule 4.

c. Any future operations in other overseas locations will attract the payment of an appropriate area allowance to be determined by prior agreement between the Company and the Pilot Representatives.”

[12] The quantum of the DTA is currently $5.63 per hour (meals not provided) for each hour away or $135.12 per day. The quantum of the Norway allowance is currently an additional $3.59 per hour or $86.15 per day. The dispute specifically relates to clause 26.2.3(c) of the Agreement.

[13] The AFAP contends that an allowance should be struck for attending the flight simulator in Stockholm. CHC does not consider that any payment above the level of the DTA is warranted.

Principles of Interpretation

[14] The principles for interpreting terms of enterprise agreements are well established by various High Court and Federal Court decisions. They have been summarised by a Full Bench of the Commission as follows 1:

“1. The AI Act does not apply to the construction of an enterprise agreement made under the Act.

2. In construing an enterprise agreement it is first necessary to determine whether an agreement has a plain meaning or contains an ambiguity.

3. Regard may be had to evidence of surrounding circumstances to assist in determining whether an ambiguity exists.

4. If the agreement has a plain meaning, evidence of the surrounding circumstances will not be admitted to contradict the plain language of the agreement.

5. If the language of the agreement is ambiguous or susceptible to more than one meaning then evidence of the surrounding circumstance will be admissible to aide the interpretation of the agreement.

6. Admissible evidence of the surrounding circumstances is evidence of the objective framework of fact and will include:

(a) evidence of prior negotiations to the extent that the negotiations tend to establish objective background facts known to all parties and the subject matter of the agreement;

(b) notorious facts of which knowledge is to be presumed;

(c) evidence of matters in common contemplation and constituting a common assumption.

7. The resolution of a disputed construction of an agreement will turn on the language of the Agreement understood having regard to its context and purpose.

8. Context might appear from:

(a) the text of the agreement viewed as a whole;

(b) the disputed provision’s place and arrangement in the agreement;

(c) the legislative context under which the agreement was made and in which it operates.

9. Where the common intention of the parties is sought to be identified, regard is not to be had to the subjective intentions or expectations of the parties. A common intention is identified objectively, that is by reference to that which a reasonable person would understand by the language the parties have used to express their agreement.

10. The task of interpreting an agreement does not involve rewriting the agreement to achieve what might be regarded as a fair or just outcome. The task is always one of interpreting the agreement produced by parties.”

[15] I will apply these principles to the interpretation of the Agreement.

Does clause 26.2.3(c) apply?

[16] CHC contends that travel to Stockholm for simulator training conducted by a third party is not properly described as a future operation of the company and therefore clause 26.2.3(c) has no application to travel for simulator training in Sweden. As a consequence there is no basis for the Commission to determine a dispute about an allowance when visiting Stockholm.

[17] In my view this submission applies an unduly narrow construction of clause 26.2.3(c) and should be rejected. The clause in question provides for supplementary allowances for travel to East Timor (where helicopter operations have been conducted) and Norway (where simulator training has been conducted. The term “operations” is not a term of art. It has a meaning derived from its context. Pilots regularly undertake simulator training. It is a necessary part of their accreditation requirements. Accreditation of pilots is necessary for CHC’s helicopter operations. In my view there is no basis to construe the words of clause 26.2.3(c) such as to exclude travel to an overseas location for training purposes.

[18] I therefore determine that CHC is under an obligation to attempt to agree on the quantum of an allowance to apply to travel to Stockholm.

Should there be a Stockholm allowance?

[19] The Agreement does not provide any basis for determining an allowance of the nature concerned. In my view it is appropriate to consider the nature of payments made under the Agreement and the justification for any additional allowance in determining whether a further allowance should be provided.

[20] I note that the pilots are paid their salaries for attending overseas simulator training. In addition they are paid an allowance that is described as a daily travel allowance. As the allowance is paid at one of two scales depending on whether the company supplies meals, it is reasonable to assume that the allowance is intended to cover the cost of meals that pilots need to pay for as well as other incidental amounts of approximately $2.20 per hour. The allowance is paid for each hour after departure time from a home airport until return to the home airport. In other words it covers travel time and time at the location. Allowances of this type are obviously intended to apply in a range of different circumstances and necessarily incorporate a swings and roundabouts approach.

[21] The additional allowance for a tour to East Timor appears to be compensation for lower standard accommodation and facilities in that country. The additional allowance for travel to Norway appears to relate to the cost of living in that country. The non-payment of additional allowances for travel to all other locations implies that the DTA sufficiently covers the reasonable costs of travel to those locations. However it should not be assumed that any of those allowances is an accurate assessment of costs at these locations and that the allowance should be assessed by reference to a comparison between the locations and the quantum of the allowances alone.

[22] The premise of the Agreement is that reasonable costs are covered by an allowance. In my view the fairest approach to this matter is to consider whether the existing allowance is sufficient to cover the reasonable costs for travel to Stockholm. Any further allowance should be based on a finding that costs in excess of the daily travel allowance are being reasonably incurred by pilots and will be incurred on future trips. I do not consider that there is any basis in the Agreement to determine this matter on the basis of ATO or other cost of living assessments.

[23] There is limited material before the Commission as to the costs at Stockholm. Transfer costs are paid. The DTA allowance is paid on the basis that meals are not provided, but during air travel and for breakfasts at the hotel, meals are provided. A menu from the Radisson Blu restaurant was put into evidence. Main Courses range from 145 - 375 Swedish Krona. At current exchange rates this equates to A$23.20 - $60. A Black Angus Burger is A$31.20. Wine is around A$14 per glass. There is very limited essential travel expense. In my view it has not been established that the DTA of approximately $135 per day over the entire period of the trip is insufficient to cover reasonable expenditure. I do not consider that a case has been made out to pay an additional allowance for travel to Stockholm.

Determination

[24] For the above reasons I consider that the parties have authorised the Commission to determine the dispute over the payment of an allowance for travel to Stockholm to undertake simulator training for AS332 Helicopters. I do not consider that the evidence before the Commission provides a basis for an allowance to be paid over and above the $135 per day allowance paid to pilots under the Agreement for the duration of the trip. The dispute is determined accordingly.

VICE PRESIDENT

Appearances:

Mr Stephens, D with Mr Allan, L for AFAP.

Mr Bakewell, S consulting with Ms Edwards, A for EMA.

Hearing details:

2016.

Melbourne.

31 August.

Final written submissions:

AFAP on 19 August 2016.

CHC Helicopters on 25 August 2016.

 1   [2014] FWCFB 7447.

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