[2020] FWC 5197

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s 739—Dispute resolution

Australian Licenced Aircraft Engineers’ Association, The
v
Jetstar Airways Pty Ltd t/a Jetstar Airways
(C2020/58)

Airline operations
DEPUTY PRESIDENT SAMS	SYDNEY, 7 OCTOBER 2020

Application to have the Commission deal with a dispute under a dispute settlement procedure (‘DSP’) in an enterprise agreement - appointment of licenced aircraft engineers as Supervisors and 2ICs by Jetstar on a temporary basis - whether such appointments should be made on a permanent basis - new definitions in the Agreement - jurisdictional objections raised by Jetstar - whether steps in the DSP strictly followed - whether dispute properly characterised - principles of interpretation of an enterprise agreement - late jurisdictional objections not made out - definitions of Supervisor and 2IC do not permit appointment on a temporary or ad hoc basis - distinction drawn with leading hand definition - Association’s merit argument made out - question asked determines dispute - proceedings concluded.

[1] On 6 January 2020, the Australian Licensed Aircraft Engineers’ Association (the ‘ALAEA’ or the ‘Association’) filed an application, pursuant to s 739 of the Fair Work Act 2009 (the ‘Act’), which seeks to have the Fair Work Commission (the ‘Commission’) deal with a dispute under the Jetstar Airways Engineering & Maintenance Enterprise Agreement 2018 (the ‘2018 Agreement’). At its heart, the dispute concerns the appointment of employees to Second in Charge (‘2IC’) and Supervisor positions on a fixed term basis which the Association contends is not permitted by the Agreement. The Association further contends that such appointments must be made on a permanent basis.

[2] The disputed clause in the 2018 Agreement is found at Cl 2.35 dealing with Definitions, which reads:

‘2.35 “Supervisor”, “2IC” and “Leading Hand” mean the following:

2.35.1 “Supervisor” means an Employee who is appointed by the Company as such and performs all of the duties typically required of a Supervisor, including supervising the safe acquittal of work on their shift on day of operations, supervising compliance with Jetstar and Qantas Group policies and procedures, being responsible for performance of staff on their shift including conducting periodic reviews and performance management, and any additional duties as reasonably required by management. An employee appointed as a Supervisor will be paid the Supervisor rate in Table 4 in Clause 26 at all times.

2.35.2 “2IC” means an Employee who is appointed by the Company as such and who provides a permanent and ongoing support function to Supervisors in their local port, including by assisting with periodic performance reviews and performance management. An employee appointed as a 2IC will be paid the 2IC rate in Table 4 in Clause 26 at all times.

2.35.3 “Leading Hand” means an Employee who is appointed by the Company as such and provides an ad hoc or temporary support by covering an absent 2IC or Supervisor, or who acts as a point of contact in the absences of a 2IC or Supervisor on a shift (for example, during an overnight shift). An employee appointed as a Leading Hand will be paid the Leading Hand rate in Table 4 in Clause 26 for the relevant shift.’

[3] Clause 26.3.1 provides for the allowances to be paid to Supervisors, 2ICs and Leading Hands as follows:

Allowance	FFPP 1 January 2019	FFPP 1 January 2020	FFPP 1 January 2021
Supervisor (per year)	$9,270	$9,548	$9,834
2IC (per year)	$4,635	$4,774	$4,917
Leading Hand (per day)	$25.40	$26.16	$26.94
OJT / POC Instructors (per year)	$4,671	$4,811	$4,956
AME Appointed Signatory (per year)	$1,318	$1,357	$1,398
AME Additional Qualifications	$1,821	$1,876	$1,932

[4] As Jetstar has raised jurisdictional objections to the dispute being dealt with by the Commission, I set out the ‘Resolving Workplace Concerns or Disputes’ (Dispute Settlement Procedure (‘DSP’)), which reads:

‘20. RESOLVING WORKPLACE CONCERNS OR DISPUTES

If there is a dispute relating to any matter arising under this Agreement or in relation to the NES, the following dispute resolution procedure will be followed:

20.1 A dispute will first be discussed between the Employee and their local Line Maintenance Manager or Duty Operations Manager (in ports where there is no LMM/DOM, the dispute will be discussed with their local Supervisor in the first instance). The local manager will make a decision on the potential resolution and advise the Employee verbally or in writing if requested within 72 hours of notification.

20.2 If the dispute is not resolved, the Employee may refer the matter to more senior levels of management for further consideration. A response will be provided where possible within five (5) working days, but no later than ten (10) working days.

20.3 If the dispute remains unresolved either party may notify the existence of a dispute to the FWC for conciliation and if conciliation is unsuccessful, arbitration.

20.4 Where the above procedures are being followed work will continue as per the status quo prior to the dispute arising provided the matter in dispute does not relate to an imminent risk to health or safety and the Employee cannot be reallocated to other appropriate duties.

20.5 No party will be prejudiced as to the final settlement by the continuation of work in accordance with this clause.

20.6 The Employee has the right to be represented by a representative of their choice (including a representative from a Union) during any step in this process.’

[5] It is Jetstar’s contention that there is no dispute between any employee covered by the 2018 Agreement and Jetstar, in accordance with Cls 20.1 and 20.2, regarding the appointment of 2ICs and Supervisors, and therefore the DSP has not been properly engaged, such as to confer jurisdiction on the Commission to arbitrate the dispute under Cl 20.3. As the establishment of jurisdiction is a fundamental underpinning prerequisite to the Commission’s exercise of arbitral powers, this question will necessarily fall firstly for determination. However, both parties argued their respective cases as to jurisdiction and merits at the same time. I shall return to the jurisdictional arguments shortly.

[6] In accordance with my usual practice, I convened two conferences between the parties on 20 January and 24 February 2020. However, no settlement of the issues in dispute was able to be achieved. Accordingly, at the end of the second conference, I issued directions for the filing of evidence and submissions in preparation for a hearing on 18 May 2020. Given the prevailing impact of COVID-19 on the Commission’s hearings, the matter was conducted by phone.

[7] At the hearing, Ms L Saunders of Counsel, with Mr S Purvinas and Mr S Morgan appeared for the ALAEA, and Mr J Forbes of Counsel, with Ms A Agostino, Solicitor, Herbert Smith Freehills, appeared with Mr M Zielinski for Jetstar. Both parties were granted permission to be represented by lawyers, pursuant to s 596 of the Act.

THE EVIDENCE

[8] Three persons provided evidence and were cross examined in the proceeding:

• Mr Stephen Purvinas – Federal Secretary of the Association;

• Mr Andrew Linegar – Licenced Aircraft Maintenance Engineer (‘LAME’); and

• Mr Maciek Zielinski – Employee Relations Manager, Jetstar.

Mr Purvinas’ statement

[9] As Federal Secretary of the ALAEA, Mr Purvinas represented members during the course of enterprise bargaining for the 2018 Agreement, and attended most of the meetings with Jetstar to discuss the Association’s log of claims served on Jetstar on 27 March 2017. At the time, each port had one or more LAMEs engaged as Supervisors and Leading Hands. There was no 2IC role. He said that when Leading Hands acted up as Supervisors, they would often not be paid a higher duties allowance. This was a source of regular disputation and the Association’s log of claims sought to address the matter by two claims as follows:

(a) improving allowances for the Supervisor Position, including when LAMEs acted up in the role; and

(b) including a definition of the duties of Supervisors and Leading Hands (in the Agreement).

[10] Mr Purvinas said that Jetstar had also wanted to make changes to the supervisory structure. At the time, the Association’s preference was for the Supervisor’s role to be shared around to any qualified LAME. Jetstar had prepared a single permanent position (which became the new 2IC position).

[11] It was Mr Purvinas’ evidence that a compromise was reached whereby a new three-tier structure of permanent Supervisor, permanent 2IC and an ad hoc Leading Hand role was to be filled by any qualified person. During one of the bargaining meetings, Mr Zielinski proposed that the word ‘permanent’ be added to the 2IC position, as Jetstar wanted to apply the same merit-based process to the position. The Association proposed the inclusion of the words ‘ad hoc’ to the Leading Hand role to provide an opportunity for others to share experience and work toward appointment to the two higher positions. Mr Purvinas claimed that at no time did Jetstar communicate to the LAMEs or the Association that it had intended to rotate the 2IC positions on fixed term contracts. Mr Purvinas set out the ‘toing and froing’ in the negotiations with various drafts (the final version was in ‘Draft V5’) leading to the approval of the 2018 Agreement.

[12] In respect to the present dispute, Mr Purvinas said that on around 27 November 2019, he was made aware that Jetstar had issued letters of appointment for temporary 2IC positions at its Newcastle engineering base. The letter read as follows:

‘Temporary requirement to undertake 2IC duties in NTL

Following an EOI and selection process, this letter confirms the business requirement for you to temporarily perform higher duties, namely 2IC duties, for the period from 25/11/19 until 25/11/21 (24 months).

During this period, and in recognition of you performing these higher duties, you will receive a 2IC allowance in line with the Jetstar Airways Engineering & Maintenance Enterprise Agreement 2018 (EBA). The business' expectations in relation to your performance of the 2IC duties are outlined in the attached role clarity document.

At the end of the period of temporary 2IC duties, the allowance associated with the performance of these duties will cease to be paid. Any need for continuing 2IC duties beyond the end of the temporary period will be reviewed in or around 25/09/21.

Your temporary appointment to perform 2IC duties is also subject to ongoing operational needs. If during the period of your temporary 2IC duties Jetstar's business needs change, and your performance of 2IC duties is no longer required by Jetstar, the Company may end this temporary arrangement on 2 weeks' notice.

Please confirm your acceptance of the temporary 2IC duties by signing the acknowledgement below.

If you have any questions, please don't hesitate to contact me.

Yours sincerely

Greg Hutchinson’

[13] This letter followed an EOI process which expressly said:

“• The requirement to perform 2IC duties for successful applicants will be for a fixed period of 24 months.

• Team members will only be considered for 2IC opportunities in their current home port location.

• These opportunities will be reviewed by the business on a regular basis.’

[14] Mr Purvinas wrote to Mr Zielinski on 27 November 2019, notifying of a dispute in relation to the 2IC appointments in Newcastle. Having been informed that fixed term contracts were to apply to the appointment of 2ICs Australia-wide, Mr Purvinas wrote again to the Company on 29 November 2019 advising of a dispute in relation to the 2IC fixed term appointments. Mr Purvinas said that also around 27 November 2019, he became aware of EOIs in relation to the appointment of a Supervisor in Melbourne on a fixed term basis. He wrote to Mr Zielinski notifying of a dispute with the Association, contending that such an appointment was in breach of the 2018 Agreement. When this position was filled in late December 2019, Mr Purvinas notified Jetstar of a dispute under Cl 20 of the 2018 Agreement.

Mr Andrew Linegar

[15] Mr Linegar is an Association delegate and is based in Coolangatta. He was an Acting Supervisor over the last 3-5 years. This appointment ended in mid-2019.

[16] In his representative role, Mr Linegar attended all of the bargaining meetings for the 2018 Agreement. Mr Linegar said that at the time, Jetstar employed a number of LAMEs in a Supervisor position. He said that there were problems with support for these roles, particularly when the Supervisor was away and its impact on the smaller parts, like Coolangatta, Brisbane and Cairns.

[17] Mr Linegar recalled that during the negotiations, Mr Zielinski agreed the issue needed to be addressed. As a result, a new, permanent role of 2IC was agreed. When Mr Purvinas had said that the new role should be rotated to give all LAMEs a chance to gain supervisory experience, Jetstar rejected this and made clear that the 2IC positions were to be permanent. There was never any mention of secondment or ‘timelines’ attached to this position.

[18] Mr Linegar attached a copy of an update notice of the bargaining which referred specifically to the new 2IC position as follows:

‘New permanent 2IC roles

• A 2IC role will be created in most ports and provide ongoing support to Port Supervisors.

• 2IC will attract an annual payment of $4,635 per year.’

Mr Maciek Zielinski

[19] Mr Zielinski was a bargaining representative for Jetstar and had drafted parts of the 2018 Agreement. The bargaining process involved the Unions – the ALAEA and the Australian Manufacturing Workers’ Union (‘AMWU’) – and 10 individual bargaining representatives (‘EBRs’). Six of these representatives knew each other and bargained together as a group known as the Engineering Consultative Committee (the ‘ECC Group’). One of these representatives was Mr Julian Farley, a full-time permanent LAME, based in Sydney, who was often appointed to perform leading hand duties. Mr Zielinski said that one of the key issues raised by the ECC Group was how the supervisory structure should operate.

[20] Mr Zielinski traced the history of the distinctions between the categories of employment, employee classifications and additional job functions which had operated in substantially the same way from the Jetstar Airways Engineering & Maintenance Enterprise Agreement 2013 (the ‘2013 Agreement’) to the 2018 Agreement. However, under the 2013 Agreement there was a two-tiered supervisory structure of Supervisors and Leading Hands.

[21] Mr Zielinski said that in some cases, Supervisors were also appointed as Practical On Course Trainers (‘POC Trainers’), which at times required them to travel to other ports for extended periods to provide practical training to engineers. In this time, certain employees were regularly appointed on a temporary basis to perform the leading hand function to cover for the absent Supervisor. Usually, these temporary appointments were for periods of three consecutive months, although on occasion, this period might be longer (as was the case for Mr Farley).

[22] Mr Zielinski put that the ECC Group had claimed that those who regularly backfilled the Supervisor role should be entitled to a more permanent position, rather than it being sporadic or ad hoc. This was the genesis of the 2IC position. Mr Zielinski claimed that this issue was not raised by the ALAEA at any time during bargaining and ultimately Jetstar negotiated with the ECC Group for a three-tiered structure, whereby:

‘(a) the Supervisor role would remain unchanged;

(b) a new second in charge (2IC) role would be established to recognise the need for a more regular, consistent and ongoing support function to the Supervisor including by assisting with periodic performance reviews and performance management; and

[23] Mr Zielinski said that for operational reasons, Jetstar had clearly communicated that Supervisors and 2ICs could be appointed on a temporary, fixed term basis. This would allow a wider range of engineers to gain supervisory experience. This view was supported by a number of EBRs who had expressed a desire to refresh the existing cohort of incumbent Supervisors. Mr Zielinski stressed that fixed term appointments allowed for a rotational system which maximised employee opportunities and created a ‘pipeline of talent’. This objective was stated firmly and consistently by Jetstar.

[24] In describing the intention of the definitions in the Agreement, Mr Zielinski said that 2ICs are to provide a regular and ongoing support function to Supervisors. This is in contradistinction to Leading Hands, whose role is to temporarily back fill and act as a point of contact only in the absence of a 2IC and/or Supervisor. This new 2IC role was to fill the gap between Supervisor and Leading Hand. Under the 2018 Agreement, 2ICs would receive an allowance of proportionately the same value as a Leading Hand, but for the entire duration of the appointment, irrespective of whether 2IC duties are performed on each shift. Leading Hands would receive a daily equivalent allowance for any shift actually worked as a Leading Hand.

[25] It was Mr Zielinski’s view that the phrase ‘permanent and ongoing support’ in Cl 2.35.2 was not used to convey incumbency of the 2IC role; rather, ‘permanent’ formed part of the wider description to distinguish support provided by the 2IC from the daily ad hoc support provided by a Leading Hand. It is envisaged that a 2IC appointee will provide ‘permanent and ongoing support’ to the Supervisor for the period of his/her fixed term appointment. Mr Zielinski conveyed this proposition to Mr Purvinas in a draft proposed agreement on 26 October 2017. Further, it was not Jetstar’s intention to specify the nature of the duties of 2ICs and Leading Hands, but that supervisory positions would be undertaken as and when required by Jetstar, including on a temporary, ad hoc basis.

[26] Mr Zielinski said that since the commencement of the 2018 Agreement (9 May 2019), Jetstar had advertised internally and offered Supervisor and 2IC roles to qualified persons. Fixed terms of appointment do not alter the permanent status of the employee. Further, employees must maintain currency of their various maintenance approvals during any fixed term appointment.

[27] Mr Zielinski responded to Mr Linegar and Mr Purvinas’ evidence by disputing the alleged comments made by him which he had explained in his statement. Specifically, Mr Zielinski restated that the ALAEA had not made a claim about the definition of Supervisors and Leading Hands. Rather, the Association was concerned about a definition of the LAME classification and the duties to be performed by LAMEs. Jetstar resisted this claim, as it would remove flexibility in the event of unforeseen regulatory or technological change.

[28] Mr Zielinski said that rather than supporting a proposal to share the 2IC role, the ALAEA was firmly opposed to sharing or rotating of roles and on one occasion when he was explaining the employee development opportunities to a wider group of employees, Mr Purvinas ‘blew up’ and accused him of ‘HR speak’. The ALAEA did not actively pursue this claim. Mr Zielinski could not recall any discussion where he had insisted on ‘permanent’ being included in the definition of 2IC. It was always made clear that permanent was to be used to distinguish the ad hoc nature of the Leading Hand role. It was not the ALAEA who had proposed the words ‘ad hoc’. Mr Zielinski could not recall any discussion about permanency, in the sense of permanent appointments as now claimed.

[29] Mr Zielinski said that Mr Purvinas did not specify any individual employee who was involved in the EOI process who raised any concern and he was not aware of any concerns in regard to either the EOI process, or the proposal to appoint employees on a fixed term basis.

[30] In a reply statement, Mr Purvinas referred to the members of the ECC Group and said he had been informed that the Group had proposed two yearly rotations of Supervisors, but this was rejected by Jetstar. This proposal was mentioned in meeting minutes of the 11 May 2018 negotiations. Mr Purvinas provided notes of the bargaining meetings on 14 September 2017 and 17 April 2018, and two emails sent to members, which referred to the claim for a definition of Supervisors and Leading Hands.

[31] Mr Purvinas did not agree that Jetstar was pursuing enhanced career development or had ever proposed rotation of LAMEs through the Supervisor and 2IC role. This was an ALAEA proposal which Jetstar had refused.

Oral evidence

Mr Purvinas

[32] In cross examination, Mr Purvinas agreed that he had not attended the agreement negotiation meetings between the ECC Group and Jetstar and that there were 10 EBRs, in addition to the ALAEA and the AMWU.

[33] Mr Purvinas agreed that the Association’s log of claims had sought a detailed job description for LAMEs. He further agreed that when a Leading Hand acts up as a Supervisor, they receive a proper higher duties allowance. Mr Purvinas accepted that the log of claims did not seek a change in the supervisory structure. However, the Company had proposed a 2IC role which became part of the discussion. He was not aware of the issue being agitated by the ECC Group. Mr Purvinas added that the ALAEA put a proposal in several meetings for the 2IC role to be shared amongst qualified employees, but this was rejected by Jetstar, as it wanted the supervisory roles locked in permanently. A compromise of the three-tiered structure arose subsequently (late 2017). Mr Purvinas denied it was ever Jetstar’s position that the 2IC role would be permanent.

[34] Mr Purvinas did not dispute that Mr Zielinski proposed the changes to the Leading Hand definition to include a more permanent 2IC arrangement to provide local support. It was not put that such an arrangement was not to be permanent. Nor was it put that Jetstar wanted people to rotate through the role. He rejected Mr Zielinski’s evidence to the contrary.

[35] Mr Purvinas said the issue of EOI letters and letters of appointment in Newcastle was raised by a delegate and Federal Executive member, Mr Robert Toovey. At the time, Mr Purvinas took the view that Jetstar was in breach of the 2018 Agreement and he wrote to Jetstar to express this view. Members in Newcastle and Melbourne had asked the Association to represent them in discussions with Management. Nevertheless, he understood local discussions had also been held.

Mr Linegar

[36] Mr Linegar explained in cross examination that when he was appointed to act as a Supervisor over three to five years, it was because two of only four POC trainers in Jetstar were assisting at Qantas. He accepted the appointment on secondment and knew it was not going to affect his permanency as a LAME. He was paid an allowance for doing so, until it ended in mid-2019.

[37] Mr Linegar said he was aware of the supervisory structure under the 2013 Agreement and he was involved in the negotiations for the three-tiered structure under the current 2018 Agreement. He knew of Mr Farley and the ECC Group.

[38] Mr Linegar accepted that the ALAEA had not sought to change the supervisory structure in the 2017 log of claims and that item 22 in the log was a claim for job descriptions for LAMEs to be included in the new Agreement. Mr Linegar agreed that Jetstar had proposed the 2IC role following representations by Mr Farley and the ECC Group. He conceded that the Union itself had never claimed, nor agitated for a new supervisory structure.

[39] It was Mr Linegar’s evidence that the Company had not proposed retaining employees in the 2IC role; in fact, it was Mr Purvinas who had raised the proposal and Jetstar rejected it in an early meeting in the negotiations. He recalled discussions about this and many other issues. Mr Zielinski and Mr Oldmeadow had indicated it was to be a permanent role, but he could not recall the specific discussion. He claimed the Company did not say the role was to be appointed on a temporary or fixed term basis.

Mr Zielinski

[40] In cross examination, Mr Zielinski recalled that the negotiations for the 2018 Agreement occurred from May 2017 – November 2018 and involved 30-40 bargaining meetings, with different groups of bargaining representatives. The Jetstar bargaining team consisted of senior managers and HR managers. He was not aware that anyone had ever prepared any official minutes of the meetings and while he expected some representative took notes, he had not sought to make inquires of any notes in the system. For his own part, Mr Zielinski kept notes and various email exchanges between management and the other bargaining representatives.

[41] Mr Zielinski was asked about the supervisory structure in the 2013 Agreement. He recalled there had been arguments about the payments for leading hands, although no formal dispute was ever raised. Mr Zielinski recalled some employees who had acted up for a long time believed they should be treated as supervisors. Jetstar had a different view. The substantive Agreement structure was Apprentices, AMEs, LAMEs and Supervisors with an additional layer of additional duties, when a LAME acted up as a Supervisor. Mr Zielinski agreed this was the extent of the career path for LAMEs. He acknowledged that when a LAME undertook a supervisor’s role, it was a more senior role.

[42] Mr Zielinski explained that the primary focus why Jetstar proposed a new supervisory structure (a new 2IC role), was to address the circumstances where a LAME had acted up for periods which were not isolated or ad hoc. Mr Farley was the clearest example of this, although he was acting up as a Leading Hand, but he was not performing the full range of supervisor duties. The 2IC role was to provide regular, consistent and ongoing support for the Supervisor, including permanent backfilling a 2IC or Supervisor.

[43] Mr Zielinski confirmed he had drafted the proposed wording of the definitions which was later discussed with the bargaining representatives. He was also involved in preparing the explanatory material for the ‘roadshows’ to employees. Mr Zielinski said that some of this material identified Jetstar’s other commitments to make improvements for employees outside the terms of the Agreement, such as the staff travel policy. Mr Zielinski accepted that this information was clear and accurate, as most employees were not involved in the bargaining (although represented). Mr Zielinski accepted that in one communication (AJL-02), there was reference to the new 2IC role, but there was no mention of it being a fixed term appointment. He accepted it was to ‘provide ongoing support to core supervisors’ as distinct to ad hoc support. He denied that at that point, Supervisors were persons permanently appointed as Supervisors.

[44] Mr Zielinski accepted the standard EOI form does not guarantee a two-year term, as other circumstances might intervene, such as performance, the employee no longer wanting to be in the role and changes in the needs of the business. The fixed term was terminable on two weeks’ notice. This is how the Company intends to propose offering and managing the 2IC position into the future.

[45] Mr Zielinski conceded he had not responded to Mr Purvinas’ letter of 27 November 2019, disputing the temporary appointment of 2ICs. Nor did he arrange a meeting to discuss the issue. He understood the Operations Manager in Newcastle had not responded either. Mr Zielinski was shown another letter, dated the same day, in which the Association said it considered the issue a national matter and sought to invoke the ‘status quo’ provision in the DSP of the Agreement. A third letter in similar terms was sent. Mr Zielinski acknowledged that he had not formally responded to any of the letters, as he was seeking further information from the business. He acknowledged that this was contrary to the Agreement’s timelines for responses to disputes.

SUBMISSIONS

For the Association

[46] Ms Saunders outlined the respective positions of the parties. The ALAEA contends that when an employee is appointed as a Supervisor or a 2IC, they are appointed on a permanent basis. Jetstar maintains that it can make temporary, time-limited appointments, outside the scope of higher duties, which are terminable on short notice; for example, a maximum 24 months’ appointment is terminable on 2 weeks’ notice if Jetstar decides that it no longer wants that role to be performed. She described this as an ad hoc system; effectively long-term higher duties.

[47] Ms Saunders put that the ALAEA’s position is that the words in the Agreement are not ambiguous and have a clear, plain meaning; see: principles in Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union’ known as the Australian Manufacturing Workers Union (AMWU) v Berri Pty Limited[2017] FWCFB 3005 (the ‘Berri Principles’). Nevertheless, there are issues of nuance and detail which informs the objective intention of the parties (the individual employees and the Company) from the crucial documents which were communicated at the time. Assuming a potential ambiguity, Ms Saunders submitted that the documents objectively reflect what the parties had intended and not necessarily subjective intentions. Here, there was much evidence of the negotiations at the time and ordinarily that would be inadmissible in the interpretive exercise. However, the negotiations and the documents are necessary for context. As an example of inadmissible subjective intention, which ought not to be taken into account, was Mr Zielinski’s evidence when he said:

‘It was always crucially important to Jetstar that we be able to implement fixed-term positions and in fact remove the 2IC position if necessary’.

[48] Ms Saunders said that Mr Zielinski’s evidence may be ‘a helpful historical linemarker’ as to the evolution of bargaining, but it cannot inform what the words (in the Agreement) mean. Ms Saunders put that drafts of the Agreement through deletions or additions, can identify objective intentions; see: Pepe v Platypus Asset Management Pty Ltd [2013] VSCA 38, Lodge Partners Pty Ltd v Pegum [2009] FCA 519 and Spunwill Pty Ltd v Bab Pty Ltd (1994) 36 NSWLR 290. These authorities set out what is often called the ‘private dictionary rule’ – the permissibility of viewing drafts in their proper context and more generally about common understandings.

[49] Ms Saunders put that communications to employees is of critical importance, as it guides the employees as to what they are voting for, and establishes legal consequences for both employees and the Company. Lastly, subjectively ascertainable facts related to purpose, such as problems sought to be fixed through bargaining, should correctly be taken into account.

[50] Ms Saunders dealt with the terms of the Agreement. She noted that Cl 2 – Definitions – refers to Schedule A of the classifications. The Schedule does not refer to Supervisors, 2ICs or Leading Hands, but reliance on this does not mean they are the only substantive roles an employee can be employed under. It does not apply to future employees and is irrelevant to 2ICs, because the position did not exist in the 2013 Agreement. It came into effect in the 2018 Agreement. Turning to Cl 2.35, the role of Supervisor is one that involves permanent responsibilities, not ad hoc or temporary positions. This was corroborated by Cl 2.35.1 which reads:

‘An employee appointed as a Supervisor will be paid the Supervisor rate in Table 4 in Clause 26 at all times.’

So even if a Supervisor is not exclusively doing supervisory duties, they still retain the allowance.

[51] Referring then to the definition of 2IC, Ms Saunders submitted it is ‘very, very’ difficult to get around the word ‘permanent’. It must surely have been introduced to distinguish from a Leading Hand utilised on an ad hoc or temporary basis. Permanent is not temporary support. Sometimes a LAME will act up and become a Leading Hand. However, when objectively viewed, 2ICs are deliberately intended to be different and ongoing. There could be no ambiguity and moreover, other clauses support this proposition. Further support can be found at Cl 26.3 which provides for the allowance for the 2IC to be based on annual indicia, reflecting annualised salaries.

[52] Ms Saunders analysed the drafts of the Agreement at the time. What happened was the parties had directly decided not to include a supervisory structure that contemplates being either temporary or permanent. It delineated to have the first two classifications as permanent and the third as temporary. Further drafts referring to allowances comprehended the allowance being paid to Supervisors and 2ICs ‘at all times’, as opposed to the relevant shifts.

[53] Ms Saunders answered the question of the role of the Higher Duties clause, vis a vis the Leading Hand role, by submitting that the Leading Hand is someone who is appointed to backfill on an ad hoc basis, and the Higher Duties clause is to reflect shift by shift appointments. That this is so, is borne out by the fact the payment is different.

[54] Ms Saunders referred to the communications Jetstar provided to the employees before they voted for the Agreement. It was said a key improvement was:

‘The 2IC role will be created in most ports and provide ongoing support to port supervisors’.

[55] The intention was to provide career progression for LAMEs, as stated by Mr Purvinas, ‘[w]e proposed the revised supervisor structure with the introduction of 2IC roles in major ports’. Ms Saunders said that if the ALAEA is wrong, then these communications are significantly inaccurate. What employees were told before the vote, was that the Agreement intended an improved supervisory role with the intended career path benefits. It was not about reducing the permanency of the Supervisor’s role.

For Jetstar

[56] Mr Forbes dealt firstly with the jurisdictional objection going to the Association’s failure to comply with the mandatory steps in the Agreement’s DSP. Although it is regrettable (Mr Forbes agreeing with me as ‘most unsatisfactory’) that this objection had been raised belatedly, it remains a ‘live’ issue, as to whether the Commission is ultimately able to deal with the matter. Two questions arise; firstly, there must be a dispute; and secondly, the dispute must be pursued through the staged process in the DSP; see: The Australian Workers’ Union v MC Labour Services Pty Ltd [2017] FWCFB 5032 (‘MC Labour’)and National Union of Workers v Stanley Black & Decker Pty Ltd [2018] FWC 1339 (‘Black & Decker’). Mr Forbes said that this later authority reinforces the conclusions in MC Labour and the DSP in that case is similar to the one here, which requires a dispute to be between an employee and the employer. Mr Forbes put that there is no evidence in this case that there is a dispute between a Jetstar employee and Jetstar.

[57] Mr Forbes referred to the evidence of Mr Purvinas in which he described a ‘pathway’ of the dispute, having commenced with certain notices and EOIs sent to LAMEs, which were then brought to the attention of the Association (Mr Purvinas) through the local delegates. What then happened was the Association wrote to Jetstar claiming non-compliance with the Agreement, in terms of the appointment at temporary Supervisors and 2ICs. The fact Jetstar may have responded to the Association’s letters does not create jurisdiction when there was no mention anywhere of the subject matter being pursued by an employee through the DSP.

[58] Mr Forbes agreed with me that firstly, one consequence of such an approach would be to preclude the employer from initiating a dispute because of the words in Cls 20.1 and 20.2:

‘20.1 A dispute will first be discussed between the Employee and their local Line Maintenance Manager or Duty Operations Manager (in ports where there is no LMM/DOM, the dispute will be discussed with their local Supervisor in the first instance). The local manager will make a decision on the potential resolution and advise the Employee verbally or in writing if requested within 72 hours of notification.

and secondly, I am not bound by a single member’s decision (namely, the Black & Decker case).

[59] Turning then to the interpretation of Cl 2.35, Mr Forbes submitted that the Association’s construction does not make sense. It is inconsistent with the language of the clause and fails to grasp the distinction between the performance of a role and incumbency in a classification or position. He said that there is nothing in the 2018 Agreement, express or otherwise, which prohibits Jetstar from appointing a person to a particular function or to perform a role for a period of time, similar to relocating an employee from one port to another for a time; see: paras 65-81 of Jetstar’s submissions.

[60] Mr Forbes referred to the evidence of Mr Linegar, who had himself been appointed as a Supervisor for a period of time, and went back to his substantive role, without complaint. Mr Zielinski’s evidence dealt in considerable detail going to the background of the issue and the disquiet under the 2013 Agreement amongst some LAMEs who were backfilling for Supervisors very regularly and who believed they were not properly remunerated. This was, in essence, how the 2IC role came into existence. Ultimately, however, Mr Forbes said that what the parties set out to achieve in bargaining does not take the matter anywhere.

[61] Mr Forbes submitted that there are three key matters which support the interpretation for which Jetstar contends:

1. The structure and scheme of the Agreement as a whole.

2. The distinction between employee classifications and the roles they might perform.

3. The plain, ordinary meaning of the words in the relevant clauses.

[62] Mr Forbes observed that there are only three classifications in the Agreement to which employees may fit:

• Apprentice;

• Aircraft Maintenance Engineer (‘AME’); or

• Licenced Aircraft Maintenance Engineer (‘LAME’).

[63] Further, there are four manners of employment:

• Casuals;

• Apprentices;

• Permanent Full Time; and

• Permanent Part Time.

[64] It is plain that Leading Hand, Supervisory and 2IC functions are additional functions performed by an employee in one of the above three classifications. Mr Linegar is a good example of this. His permanency is attached to his substantive classification, not to performing additional functions. Had it been otherwise, Mr Forbes opined, then surely the classification structure would have included Leading Hand, 2IC and Supervisor. Further support for this comes from the remuneration in Cl 26 by which additional duties are paid for by allowances.

[65] In addressing Cl 2.35.2 directly, Mr Forbes rejected that the word ‘permanent’ is attached to the incumbency of the role. It is ‘simply part of a compendious phrase’. It is descriptive of the function which is being performed, not the role itself. This was entirely consistent with Mr Zielinski’s evidence of what the issue was, which was sought to be resolved. The evidence was compelling that the three-tiered supervisory hierarchy, put forward by Jetstar itself, was intended to cure the issue raised by the Farley ECC Group. Moreover, the claim of the Association for permanency is at odds with what it had initially proposed of rotating employees in supervisory roles, which Jetstar had rejected.

[66] Mr Forbes dealt with Ms Saunders’ submission as to what a reasonable person (being the employees) would have understood as to what was intended by the communications from Jetstar, and what they voted for. Firstly, the language in the communications are entirely neutral and does not weigh either way. Secondly, there was no evidence from any employee as to what they understood or believed they were voting for; it was just a submission from Counsel. Mr Forbes also observed that the word ‘permanent’ does not appear in the Supervisor definition, and where it does in the 2IC definition, it is used in the context of describing the manner in the role will support the Supervisor.

[67] In reply, Ms Saunders acknowledged that there was no evidence of what an individual employee understood when they voted for the Agreement. This would of course be a subjective intention. But the point is what a reasonable person believed, from the communications from Jetstar, they had voted for. Ms Saunders rejected Mr Zielinski’s evidence that the new structure was raised by an individual bargaining representative, rather from Mr Linegar’s evidence which said that the supervisory structure was a result of the Supervisor allowance claim. It is clear that Jetstar requires both Supervisors and 2IC roles. Correctly viewed, such a decision is for a permanent 2IC role. Mr Linegar’s position is indicative – he was not backfilling a role, but had to go somewhere else for a period of time as notified by Jetstar. It must be a permanent appointment.

[68] Ms Saunders said that Jetstar’s reliance on the allowances paid when undertaking the roles of Supervisor and 2IC, ignores that the allowance is paid ‘at all times’, including when the employee is not performing supervisory functions across the entire year. This disproves the duties focussed analysis, urged by Mr Forbes.

[69] Ms Saunders submitted that the three classifications are about an employee qualifying to be either an Apprentice, AME or LAME. Once qualified, the LAME can move through the seniority structure by appointment. Ms Saunders drew a distinction between Mr Zielinski’s qualified recollections with the clear and consistent recall of Mr Purvinas and Mr Linegar.

[70] In addressing the jurisdictional issue, Ms Saunders did not disagree with the proposition that jurisdiction cannot be conferred by consent; but it is confined by what the DSP in the Agreement provides for, as reflected by the parties’ agreement.

[71] Ms Saunders dealt with three further matters. Firstly, objections are usually raised in advance and separately to merit, following an application of the usual evidentiary onus. This is a question of fairness, the efficient use of the Commission’s resources, and fundamentally about parties being bound by their own conduct. Jetstar took no issue with the Commission arbitrating the matter until its reply submissions. It submitted to conciliation and the process of preparing for the case. It now seeks, at such a late stage, to claim a ‘knock out’ point. The case, in any event, was a mixed question of fact and a contested interpretation of an enterprise agreement.

[72] Secondly, there is the issue of waiver. MC Labour can be distinguished, in that this is not a case where the Association jumped straight to the Commission and had ignored the steps in the DSP. What happened here was that there were four attempts, in writing, setting out the dispute and who it affected. Jetstar simply chose to ignore three letters – it did not organise a meeting, did not raise a concern and did not answer any question. Ms Saunders said that what comes with a DSP is concurrent obligations on parties not to frustrate or ignore the process. This is exactly what happened here, despite the Association’s attempts to resolve the issue.

[73] In respect to compliance, Ms Saunders said it requires more than the employer simply saying the DSP was not followed. Firstly, an interpretation exercise needs to be set out, which is what the ALAEA did. The DSP is relatively straightforward. There is no requirement for an employee to nominate a representative on their behalf. There are sound industrial reasons why this is so. The DSP states that the local manager will respond within 72 hours. This does not mean the employee has not satisfied their obligations. There is then a reference to an obligation on Jetstar to respond in 5 to 10 working days. Then its ‘off to the FWC for conciliation’. Ms Saunders put that this is a streamlined process and needs to be interpreted in that light.

[74] What happened here is that the Newcastle LAME spoke to the delegate, who spoke to Mr Purvinas. It may be easily inferred that the employee was not happy with what Jetstar was doing. Mr Purvinas wrote to Mr Zielinski, the Operations Manager and continued to write to Mr Zielinski, with no response. One reply was ‘we’ll get back to you’. Ms Saunders submitted that a matter can be referred in writing and there is no restriction on this approach in the DSP. In fact, the only party that has failed to comply with the clause correctly, was Jetstar. Ms Saunders said it is ‘patently ridiculous’ for Jetstar to come and object at ‘six minutes to midnight’ and then rely on its own failure to engage, by proposing a narrow interpretation of the Agreement.

[75] Secondly, Ms Saunders relied on University of New South Wales v National Tertiary Education Union (2009) 184 IR 121 (‘UNSW v NTEU’) as significant in the sense that like this case, the dispute is a collective dispute, where as a matter of common sense, it was pointless to discuss it with your immediate Supervisor, because they have no authority to do anything.

Further submissions

[76] On 9 July 2020, after this matter was reserved, the Federal Court of Australia (Flick J) published a judgement in Qantas Airways Ltd v Australian Licensed Aircraft Engineers Association (No 2) [2020] FCA 951 (the ‘Flick J judgment’). Shortly stated, His Honour’s judgment dealt with a claim by Qantas that the ALAEA has not followed the steps in the DSP under the Qantas – and relevantly here – the Jetstar Agreements concerning a stand down dispute. It seemed to me that the parties in this matter should be provided with an opportunity to put any further submissions as to whether the Federal Court judgement was relevant to the matter now before me. Both parties availed themselves of this opportunity in short form as follows:

For the ALAEA

[77] Ms Saunders contended that the conclusions in the judgement emphasised how facile Jetstar’s purported (and late) jurisdictional objection was. Jetstar has not explained how it is entitled to raise its objections, having taken active steps in the process until changing its mind at the last minute; see: Mann v Medical Practitioners Board of Victoria (2004) VSCA 148 at para 17. Ms Saunders submitted that Flick J relevantly held:

‘a. cl.20 of the Jetstar Agreement contains a stepped procedure which must be followed before a dispute may be referred to the Commission;

b. the procedure itself is characterized by informality, and there are no textual indicators to support a conclusion that strict, rather than substantive compliance, is required; and

c. the meaning of ‘dispute’ is to be given a wide and potentially ambulatory meaning.’

[78] Properly understood, the judgment supports the ALAEA’s submission that the dispute process was correctly followed. Specifically, however, the judgment did not deal with two key issues:

(a) whether a discussion about a dispute may occur in writing, rather than in person; and

(b) what is the effect of an employer’s non-responsiveness.

[79] Ms Saunders put that consistent with UNSW v NTEU, correspondence in a collective dispute, will satisfy substantial compliance with the DSP.

[80] Secondly, Jetstar’s failure to engage in the initial processes, cannot now be used to seek to frustrate the process. It is clear discussions had failed, and the dispute could not be progressed. Further, the dispute has always been very clear and understood by all parties.

For Jetstar

[81] Unsurprisingly, Jetstar considers that the Flick J judgment reinforces its position that the requirements of Cl 20 must be satisfied in order for the Commission to have power to deal with a dispute.

[82] Mr Forbes submitted that the factual circumstances between those considered by Flick J are distinguished from this case in the following important respect. In the former case, there were a series of discussions between employees of Jetstar and senior management about the issues in dispute. There was no evidence of this in the present case.

[83] Mr Forbes added that it is necessary to determine the ambit of a dispute, subject to the DSP under the Agreement. There is no power to deal with a different dispute said to be ‘related to’ the subject of the DSP. In this case, the ALAEA contends that there are in fact two disputes; one described as the 2IC dispute and the other as the Supervisor dispute. While Mr Purvinas described the ‘pathway’ of these disputes, there is no evidence of compliance with the mandatory requirement of Cl 20. The application only notes that the ALAEA had sent numerous letters to Jetstar. This correspondence was letters of demand that certain appointments be withdrawn, and other appointments not be made. These demands were made in advance of the Union’s position that Jetstar had breached the Agreement.

CONSIDERATION

Jurisdictional issue

[84] While I accept that the Flick J judgment found that Cl 20 of the Jetstar Agreement contains a stepped procedure which must be followed before a dispute may be referred to the Commission, that is not the end of the matter. At paras 53-55, His Honour said this specifically about Cl 20.1 and 20.2 of the Jetstar Agreement:

‘53. The former argument, with respect, is not an argument that there need not be compliance with cll 6.1.1 and 6.1.2 – rather, it is an argument that there need be compliance but not “strict compliance”. Rephrased in that manner, it is concluded that substantial compliance with these provisions is sufficient.

54. Greater difficulty is expressed with the latter argument.

55. Difficulty is expressed in reaching a conclusion that there need not be any compliance – be it strict or substantial compliance – with cll 6.1.1 and 6.1.2 of the Qantas Agreement or cll 20.1 and 20.2 of the Jetstar Agreement. Although both Enterprise Agreements contain a power to stand down employees and thus contemplate that “disputes” may arise in respect to both a single or a small number of employees and also a more substantial number of employees, cll 6 and 20 nevertheless remain drafted in a manner more readily susceptible of application to a more confined dispute than has arisen in the present case. Even so, any argument that there need not be even substantial compliance with those clauses where a large number of employees have been stood down for a common reason is not self-evidently correct. To attempt to construe those terms as meaning that a matter may be referred to the Commission if it cannot be resolved through the staged process expressly set forth “or otherwise” is, with respect, to blatantly and impermissibly “give effect to some anteriorly derived notion of what would be fair or just, regardless of what has been written into the award”: Kucks (1996) 66 IR at 184 per Madgwick J.’

[85] Further, at paras, 64 and 65, Flick J said:

‘64. But cll 6 and 20 should, with respect, be construed in a manner which gives effect to the myriad of circumstances in which a “dispute” may arise and the many different circumstances in which a “dispute” may be sought to be resolved during the course of a “meeting” or “discussions”. To confine the construction of these clauses only to those circumstances involving an individual employee and a discrete personal “dispute” that that employee may have would, with respect, strip cll 6 and 20 of much of their industrial utility. In circumstances where a “dispute” may affect a great number of individual “employees”, nothing in cl 6.1.1 nor cl 6.1.2 nor cll 20.1 and 20.2 necessarily dictates that the “dispute” which is sought to be resolved requires the separate identification of an individual employee or his individual supervisor. Indeed, it would be a surprising construction of the “dispute resolution procedures” if a general “dispute” affecting a great number of employees could not be the subject of referral to the Commission in the absence of each individual employee “meeting and conferring” with that employee’s supervisor, and each individual dispute being thereafter the subject of “further discussions” with “more senior levels of management”.

65. Just as the term “dispute” is to be given a flexibility of meaning such that it can apply to a single or small group of employees or a larger number of employees and simply involving those employees putting forward their commonly held “opposing” view as to the position of an employer, the terms “meeting” and “discussion” should equally be construed with a degree of informality and flexibility. The requirement that there be a “meeting” or a “discussion” obviously does not necessarily involve the necessity for a formally convened meeting or a formal discussion. An issue giving rise to a grievance on the part of an employee or group of employees may best be sought to be resolved informally and during (for example) a lunch-break at which the employee(s) raise their concerns with a manager or supervisor.’

[86] In my view, the gravamen of the Flick J judgment is that the ordinary understanding of what is sought to be achieved by a DSP; namely, to resolve industrial disputes, should not be constrained by rigid formality and inflexibility, and that substantial and realistic compliance with the steps in the procedure is sufficient.

[87] In Construction, Forestry, Mining and Energy Union v Mt Arthur Coal Pty Ltd [2016] FWC 2959, Saunders DP described the characterisation of a dispute, inter alia, as one which may evolve and transmogrify during its currency. The Deputy President said at [8]:

‘[8] In characterising the nature of a dispute the Commission is not confined to the application filed to deal with the dispute. The entire factual background is relevant, and may be ascertained from the submissions advanced by the parties on the question of jurisdiction. Further, a dispute may evolve during proceedings in the Commission. It may therefore be necessary in some cases when ascertaining the character of a dispute to have regard to both the nature of the dispute alleged in an originating application and the factual circumstances as they evolve.’ (endnotes omitted)

[88] That said, I find it somewhat disingenuous for Jetstar to raise, for the first time, its jurisdictional objections ‘at the heel of the hunt’ in its reply submissions for this case. Jetstar is not the ‘corner store’, with little or no industrial experience, acumen or advice. The Association’s criticism of Jetstar for failing to raise these objections at any time (until its reply submissions), including when the matter was presumably not jurisdictionally competent when it was filed, or when it was subject to conciliation by the Commission, is well made and entirely understandable. Had it done so at any earlier point, the ALAEA could have gone back to Step 1 and start the entire process again. Obviously, this would be a course open to the ALAEA if I was to now find that the dispute could not proceed on jurisdictional grounds. It hardly needs stating this would be an entirely artificial, wasteful and barren exercise, inconsistent with s 577 of the Act as to the exercise of the Commission’s powers:

577 Performance of functions etc. by the FWC

The FWC must perform its functions and exercise its powers in a manner that:

(a) is fair and just; and

(b) is quick, informal and avoids unnecessary technicalities; and

(d) promotes harmonious and cooperative workplace relations.

Note: The President also is responsible for ensuring that the FWC performs its functions and exercises its powers efficiently etc. (see section 581).

[89] In my opinion, the evidence in this matter establishes that there has been substantive compliance by the ALAEA with the steps in the DSP, whereas it is Jetstar, which not only acknowledged the Association was engaging with it about a dispute, but it failed to follow the relevant Steps it was obliged to do so. For some reason (not entirely clear to me), Jetstar seems to have simply ignored the Association’s frequent correspondence.

[90] There are two other matters which to my mind are relevant. Firstly, as I raised with Mr Forbes in the proceeding, a strict, literal interpretation of Cl 20.1 and 20.2 of the DSP effectively means that it is only an employee who can initiate the DSP, effectively prohibiting the employer from doing so at any time. This would be an absurd and ridiculous result which could not possibly have been intended. It is a principle of construction that an interpretative exercise which produces an absurd or unlikely result, should be eschewed, where an interpretation which gives a practical and common-sense outcome, is to be preferred.

[91] Secondly, Cl 20.6 provides for an employee to be represented by a representative from a Union during any step in the process. In my view, this is exactly what happened here. The evidence makes plain that an individual LAME raised the issue with his delegate, who then raised it with Mr Purvinas. Mr Purvinas then had numerous unresponsive communications with Jetstar management. In other words, the employee was being represented by an Association representative at Steps 20.1 and 20.2, when it was obvious the local line manager had no authority to make a decision resolving the dispute. The employee continued to be represented by the Association when Mr Purvinas unsuccessfully sought to raise it with senior levels of management, pursuant to Cl 20.2 of the DSP. Obviously, with no response, the dispute remained unresolved and the Association was entitled to notify the Commission of a dispute under Cl 20.3 of the DSP.

[92] Moreover, Cl 20.6 does not limit or prohibit the means by which an Association representative is able to represent the employee; and in this case, the Association, represented the employee and others, by the unremarkable means of communicating in writing with Jetstar. In my opinion, there is nothing which expressly, or impliedly suggests that ‘discussions’, cannot be by other than direct face to face conversations, such as in writing and other communications between the parties. Indeed, it would be ‘best practice’ to rely on written communications between parties to characterise and delineate a dispute in question, rather than reliance on ‘who said what’ in informal discussions; a fortiori as a matter of practicality and convenience, that such a practice will ordinarily be the preferred method of dealing with collective disputes involving more than one employee. One might have understood that the Full Bench of the Commission resolved a not dissimilar argument in UNSW v NTEU where it was said at [17]-[29]:

‘Were the required preliminary steps taken?

[17] The first submissions made was that no discussion had taken place between individual employees and their supervisors as required by cl.10.0(a) of the academic staff agreement and cl.9.0(a) of the general staff agreement. The Vice President rejected this submission. His reasons appear from the following passage:

“[26] The NTEU led evidence from three staff members who each said they were involved in discussions with their supervisor concerning the requirement to take leave at around the same time as that issue was communicated to staff in August 2008. In some cases the individual dispute was resolved or did not directly arise. Those who gave evidence were also aware of concerns of other staff members and had difficulties with the requirement to take leave because of the precedent it created, even though its impact on them individually on this occasion was not great. While the University conceded that meetings between the University and the NTEU did occur, it submitted that these did not have the necessary link with any dispute between an employee and the University which had validly commenced by invoking step one of the dispute settlement process.

[27] The NTEU relied on clause 7 of each of the agreements which states that an employee may choose to be represented by an employee representative of their choosing in relation to any matter or process set out in the Agreement. It contended that it was representing employees in its dealings with the University over this issue, including those employees who had discussed the matter with their supervisor.

[28] In my view, the NTEU, as a party to the Agreement and chosen representative of certain employees in relation to this dispute, is able to invoke steps of the dispute procedure on behalf of its members. The procedure comprehends representation of parties to the dispute. I do not see any limitation on the NTEU doing so, as it has purported to do in relation to this matter including seeking arbitration of the dispute.

[29] I find that a dispute over the application and interpretation of the Agreements was raised insofar as the Agreements relate to the power of the University to require employees to take annual leave over a Christmas shutdown period. The disputes were raised by a number of employees in discussions with supervisors. Although some employees were not directly affected or had their individual circumstances addressed, there nevertheless remained a dispute over the right of the University to issue the direction that it did. Therefore step one of the process (paragraph (a)) has been followed.”

[18] The University took issue with these findings. It submitted that there was insufficient evidence that the matter had been raised by the employees with their supervisors as required by the dispute settlement procedures and that it was not open to the NTEU to act in a general representative capacity in that respect. This submission is based on a very narrow reading of the procedure. On that reading a collective dispute can only be dealt with in so far as it is constituted by the aggregate of a number of individual disputes, each of which must go through every step of the procedure. The settlement of such a dispute would necessarily also be confined to the specific employees identified. If this approach were to be adopted it would lead to some very inconvenient results, to say the least. Take a case involving the interpretation of a provision of an agreement about which only one employee raised an issue for resolution. The settlement of the dispute would be incapable of application to any other employees, with the result that each individual employee wishing to take advantage of it would need to raise an individual dispute for resolution.

[19] The inconvenience of this approach is illustrated by the facts of this case. The main issue in dispute is whether the provisions of the agreement governing annual leave apply in the case of a shutdown or whether they give way to the terms of s.236(5) of the Act. The University’s position on this issue never altered. To require every employee to raise a separate dispute would be time-consuming, costly and self-defeating. On our reading of the procedures a dispute on a matter of general application can be raised by an individual employee and dealt with on a general basis. Dispute settlement procedures in agreements, to be effective, must be simple and easy to apply. The interpretation proposed would lead to delay and complexity in the application of the procedures in the agreements we are concerned with and tend to frustrate rather than promote the settlement of disputes. It should be rejected.

[20] The University’s submissions concerning the role of the NTEU in the operation of dispute settlement procedures requires separate consideration. It was submitted that the NTEU has no independent status and it can only act as representative or agent of individual employees because s.353 of the Act confines the operation of dispute resolution procedures in an agreement to matters arising between the employer and the employees. While this is in one respect correct, it does not follow that the Commission has no jurisdiction in the present case. There were three employees who had raised a dispute and the NTEU was entitled to represent them in relation to the subject matter of the dispute. The dispute involved a matter – the application of the annual leave provisions of the agreements – which potentially affected all of the employees covered by the agreements. As we have already pointed out, a dispute raised by one employee in relation to a matter which has general application can be dealt with on that basis.

[21] It follows from these conclusions that there was an adequate basis for the Vice President’s finding that there was a dispute properly before him, at least as far as the first step in the procedures was concerned.

[22] The second step in the procedures provides that where the first step is unsuccessful the employee may refer the matter in writing to the relevant Dean or Divisional Head for resolution within five days. The Vice President’s conclusion in relation to that step is contained in the following passage from the decision:

“[30] I further find that the NTEU invoked step two (paragraph (b)) of the processes on behalf of employees by forwarding a dispute notice to the University and meeting with its representatives. As the dispute was not resolved during those discussions it was open to the NTEU to refer the matter to the AIRC for resolution under step three (paragraph (c)) of the processes.”

[23] The University submitted that the second step was mandatory and there was no evidence it had been complied with. The NTEU made a number of points under cover of a general submission that the procedure should not be read too literally. First it argued that the use of the word “may” is permissive and does not signify that in the absence of written notice to the Dean or Head of Department the dispute settlement provisions fails. Secondly it alleged that one of the employees worked in a section which did not have a Dean and another worked in an area in which the relevant supervisor with whom the matter had been raised was also the Head of Department.

[24] The conflict over this question should be decided by reference to the intention of the parties at the time the agreements were made. In the circumstances of this case, did the parties intend that the Commission should not have jurisdiction to settle the dispute? The Vice President concluded that the NTEU had satisfied the requirement on behalf of employees by forwarding a dispute notice to the University and meeting with its representatives. There was a meeting on 4 September 2008 with Mr Clarke, the industrial relations manager. On 30 October 2008 the NTEU wrote to Mr Clarke formally notifying a dispute under the agreements and seeking a meeting within 5 days. The meeting took place on 6 November 2008 and was attended by Mr Clarke and Ms Gower, the University’s Human Resources Legal Counsel. We have no doubt that the NTEU was able to make such a notification on behalf of its members, the question is whether the notification to Mr Clarke fulfilled the requirement to notify the relevant Dean or Divisional Head. In our view it did. The underlying question, whether the Act or the agreement applied, was a matter of general policy which would not alter by faculty or by division. Mr Clarke wrote the NTEU a lengthy letter following the meeting on 10 November 2008. That letter did not suggest that the requirement to raise disputes with the relevant dean or divisional head had not been fulfilled. To the contrary, the letter includes the following sentence:

“The University contends that a second meeting under the collective agreements covering academic and general staff at UNSW is required to try to resolve the NTEU’s dispute.”

[25] We think it is a necessary implication from the circumstances that Mr Clarke was authorised to and did accept notification of the dispute on behalf of the Dean and divisional heads. Clearly it had not occurred to the University that there was any deficiency in the method of notification that the NTEU had adopted in relation to the dispute or, if it had, the deficiency was not regarded by the University as significant. We can find no error in the Vice President’s conclusion on this point.

[26] The University contended that on a number of occasions it sought information about specific problems arising from its decision to extend the normal shutdown period and that it had no evidence of any unresolved problems. For this reason, it was submitted, it was not open to the Vice President to find that a dispute had arisen under the procedures. This contention must be seen in the context of the University’s submission that only disputes with individuals could be dealt with under the procedure. This approach however fails to acknowledge the fact that the issue in dispute was whether the annual leave provisions in the agreements applied or s.236(5) of the Act governed the situation. That was not a matter on which the position of particular individuals could be determinative. As we have indicated that was a matter of general significance.

[27] The third stage of the dispute settlement process involves mediation or conciliation in the Commission. The University contended that the Commission could not exercise arbitral powers under the agreements because the matter had not been the subject of mediation or conciliation in any substantive way, so there was no basis for a finding that the dispute remained unsolved and that arbitration was necessary. The Vice President made relevant findings in the following passage:

“[31] Under paragraph (c) of the dispute settlement processes, a dispute which is unresolved after being referred to the AIRC for mediation/conciliation can be referred by either party for arbitration. The University contends that no mediation or conciliation has taken place because the University indicated before Commissioner Thatcher that it did not concede that the Commission had jurisdiction and that the discussions he facilitated were expressly confined to identifying and communicating the parties’ interests. Evidence given by the University’s witnesses indicated that participation in discussions with Commissioner Thatcher were on a confidential and without prejudice basis and without the Commissioner testing whether all prior steps in the dispute settlement process had been followed. The University’s representative Mr Clarke, agreed to participate in discussions on the basis that it was not conciliation and the University’s jurisdictional objections would be dealt with at a later date.

[32] In my view the dispute settlement procedures of the Agreements do not require conciliation or mediation before the matter can be referred to arbitration. The precondition before arbitration can occur is that the dispute remains unresolved after being referred by a party for mediation and/or conciliation. The procedure does not permit one party to continually object to conciliation processes and thereby deprive the other party of the ability to progress the matter to arbitration. In this case the matter was referred for conciliation and if necessary, arbitration. At the commencement of the matter the University raised its jurisdictional objections and only agreed to participate on a ‘without prejudice’ basis. A lengthy conference then occurred about the matters in dispute.

[33] It may not be necessary that I determine whether the conference amounted to conciliation or mediation or whether the basis on which the parties participated changed its essential character. To the extent that it may be necessary I consider that the process before Commissioner Thatcher amounted to conciliation. It is sufficient that I note that the dispute remained unresolved after that conference and the reference of the matter for conciliation by the NTEU. In my view it was then open to the NTEU to seek arbitration of the dispute under the dispute settlement procedures.”

[28] With respect, the observations and finding made by the Vice President are correct. To them we would add the observation that, in light of the University’s strong contention that there was no jurisdiction, its submission that no mediation or conciliation had taken place is, to say the least, somewhat hollow. The objection might be said to be conclusive evidence that mediation and conciliation had failed. We have no doubt that the Vice President’s conclusion was correct. We note also that he made provisions for further conciliation prior to considering whether to arbitrate.

[29] For those reasons we agree with the Vice President that all of the necessary preliminary steps had been taken. Any objection to jurisdiction based on the terms of ss.709(1)(a) or 710(a) of the Act was bound to fail.’

[93] For these reasons, I am satisfied that the dispute is competently before the Commission. I proceed now to its merits.

The issue to be determined

[94] The Association and Jetstar proposed different questions for determining the dispute. The Association posed the following:

Do the terms of the 2018 Agreement require Jetstar, where it appoints LAMEs as:

(a) Supervisors, as defined in Cl 2.46.1; or

(b) 2ICs, as defined in Cl 2.35.2,

to do so on a permanent, rather than temporary or fixed term basis?

Jetstar proposed this question:

Do the terms of the 2018 Agreement prohibit Jetstar from appointing an employee to the role of Supervisor or 2IC for a fixed period?

However, in substance, answering either question will amount to the same thing – that is, do the words in Cl 2.35 definitions of Supervisor and 2IC allow or alternatively, prevent Jetstar from appointing a Supervisor or 2IC to the role on other than a permanent basis?

Relevant principles and authorities

[95] Unsurprisingly, the parties are ad idem as to the principles to be applied by the Commission when undertaking the exercise of interpreting the words in an enterprise agreement. These principles are now notoriously known as the Berri Principles which I set out below:

‘1. The construction of an enterprise agreement, like that of a statute or contract, begins with a consideration of the ordinary meaning of the relevant words. The resolution of a disputed construction of an agreement will turn on the language of the agreement having regard to its context and purpose. Context might appear from:

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

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

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

2. 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.

3. The common intention of the parties is sought to be 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, without regard to the subjective intentions or expectations of the parties.

4. The fact that the instrument being construed is an enterprise agreement made pursuant to Part 2-4 of the FW Act is itself an important contextual consideration. It may be inferred that such agreements are intended to establish binding obligations.

5. The FW Act does not speak in terms of the ‘parties’ to enterprise agreements made pursuant to Part 2-4 agreements, rather it refers to the persons and organisations who are ‘covered by’ such agreements. Relevantly s.172(2)(a) provides that an employer may make an enterprise agreement ‘with the employees who are employed at the time the agreement is made and who will be covered by the agreement’. Section 182(1) provides that an agreement is ‘made’ if the employees to be covered by the agreement ‘have been asked to approve the agreement and a majority of those employees who cast a valid vote approve the agreement’. This is so because an enterprise agreement is ‘made’ when a majority of the employees asked to approve the agreement cast a valid vote to approve the agreement.

6. Enterprise agreements are not instruments to which the Acts Interpretation Act 1901 (Cth) applies, however the modes of textual analysis developed in the general law may assist in the interpretation of enterprise agreements. An overly technical approach to interpretation should be avoided and consequently some general principles of statutory construction may have less force in the context of construing an enterprise agreement.

7. In construing an enterprise agreement it is first necessary to determine whether an agreement has a plain meaning or it is ambiguous or susceptible of more than one meaning.

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

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

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

11. The admissibility of evidence of the surrounding circumstances is limited to evidence tending to establish objective background facts which were known to both parties which inform and the subject matter of the agreement. Evidence of such objective facts is to be distinguished from evidence of the subjective intentions of the parties, such as statements and actions of the parties which are reflective of their actual intentions and expectations.

12. Evidence of objective background facts will include:

(i) 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;

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

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

13. The diversity of interests involved in the negotiation and making of enterprise agreements (see point 4 above) warrants the adoption of a cautious approach to the admission and reliance upon the evidence of prior negotiations and the positions advanced during the negotiation process. Evidence as to what the employees covered by the agreement were told (either during the course of the negotiations or pursuant to s.180(5) of the FW Act) may be of more assistance than evidence of the bargaining positions taken by the employer or a bargaining representative during the negotiation of the agreement.

14. Admissible extrinsic material may be used to aid the interpretation of a provision in an enterprise agreement with a disputed meaning, but it cannot be used to disregard or rewrite the provision in order to give effect to an externally derived conception of what the parties’ intention or purpose was.

15. In the industrial context it has been accepted that, in some circumstances, subsequent conduct may be relevant to the interpretation of an industrial instrument. But such post-agreement conduct must be such as to show that there has been a meeting of minds, a consensus. Post-agreement conduct which amounts to little more than the absence of a complaint or common inadvertence is insufficient to establish a common understanding.’

[96] The principles applying to the interpretation of an enterprise agreement were summarised by the Full Court of the Federal Court in WorkPac Pty Ltd v Skene [2018] FCAFC 131 at para 197:

‘The starting point for interpretation of an enterprise agreement is the ordinary meaning of the words, read as a whole and in context: City of Wanneroo v Holmes (1989) 30 IR 362 at 378 (French J). The interpretation “… turns on the language of the particular agreement, understood in the light of its industrial context and purpose …”: Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241 at [2] (Gleeson CJ and McHugh J). The words are not to be interpreted in a vacuum divorced from industrial realities (Holmes at 378); rather, industrial agreements are made for various industries in the light of the customs and working conditions of each, and they are frequently couched in terms intelligible to the parties but without the careful attention to form and draftsmanship that one expects to find in an Act of Parliament (Holmes at 378–9, citing Geo A Bond & Co Ltd (in liq) v McKenzie [1929] AR(NSW) 498 at 503 (Street J)). To similar effect, it has been said that the framers of such documents were likely of a “practical bent of mind” and may well have been more concerned with expressing an intention in a way likely to be understood in the relevant industry rather than with legal niceties and jargon, so that a purposive approach to interpretation is appropriate and a narrow or pedantic approach is misplaced: see Kucks v CSR Limited (1996) 66 IR 182 at 184 (Madgwick J); Shop Distributive and Allied Employees’ Association v Woolworths SA Pty Ltd [2011] FCAFC 67 at [16] (Marshall, Tracey and Flick JJ); Amcor at [96] (Kirby J).’ (citations omitted)

[97] The general legal principles applicable to the interpretation of enterprise agreements are the same as those which have traditionally applied to Awards. In a judgement of the Federal Court of Australia, Rangiah J in Swissport Australia Pty Ltd v Australian Municipal Administrative Clerical and Services Union (No 3) [2019] FCA 37 provided a helpful summary by reference to the frequently cited authorities. At para 52, His Honour said:

‘The principles of construction of awards are well-settled and include the following:

(1) The canons of construction found in the Acts Interpretation Act 1901 (Cth) apply to awards of the Commission: City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union (2006) 153 IR 426 at [52]; Construction, Forestry, Mining and Energy Union (Construction and General Division) v Master Builders’ Group Training Scheme Inc (2007) 161 IR 86 at [33]; Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Excelior Pty Ltd [2013] FCA 638 at [29]; Sydney Night Patrol and Inquiry Company Limited trading as SNP Security v Pulleine [2014] FCA 385 at [26].

(2) The task of construction begins with the natural and ordinary meaning of the words used: City of Wanneroo at [53]; Kucks v CSR Limited (1996) 66 IR 182 at 184; Australian Workers’ Union v Cleanevent Australia Pty Ltd [2015] FCA 1477 at [13].

(3) An award is to be interpreted in light of its industrial context and purpose: City of Wanneroo at [53]; Zader v Truck Moves Australia Pty Ltd [2016] FCAFC 83 at [27]; Prestige Property Services Pty Ltd v Liquor, Hospitality and Miscellaneous Union (2007) 161 FCR 95 at [56] and [109]; Soliman v University of Technology, Sydney (2008) 176 IR 183 at [82]

(4) An award is also to be interpreted in light of the commercial and legislative context in which it applies: Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241 at [2] and [13]; Construction, Forestry, Mining and Energy Union v John Holland Pty Ltd (2010) 186 FCR 88 at [90]; Shop Distributive and Allied Employees’ Association v Woolworths SA Pty Ltd [2011] FCAFC 67 at [14]-[18]; Zader at [27].

(5) An award “must not be interpreted in a vacuum divorced from industrial realities”: City of Wanneroo at [57]; Australian Workers’ Union v Cleanevent Australia Pty Ltd at [14].

(6) The relevant “context” to be considered in interpreting an award extends to the origins of a particular clause. However, most often the immediate context, being the clause, section or part of the award in which the words to be interpreted appear, will be the clearest guide: Short v FW Hercus Pty Limited (1993) 40 FCR 511 at 517-19.

(7) The Court should not make too much of infelicitous expression in the drafting of an award. Ultimately, as awards bind the parties on pain of pecuniary penalties, they should make sense according to the basic conventions of the English language: City of Wanneroo at [57]. Narrow or pedantic approaches to the construction task are misplaced, but a court is not free to give effect to some anteriorly derived notion of what is fair or just regardless of what has been written in the award: Kucks at 184; Excelior Pty Ltd at [30].

(8) While context and purpose of an award will be relevant, ultimately the Court’s task is to give effect to the meaning of the award as expressed in its words, objectively construed: Amcor Limited at [70], [77]–[114].’ (citations omitted)

[98] As required by the Berri Principles, the starting point for the interpretative exercise is the ordinary meaning of the words used, when read as a whole and in context. If the words are ambiguous, uncertain or susceptible to more than one meaning, resort may be had to ‘surrounding circumstances’.

[99] Both parties submitted that the words in the Definitions are not ambiguous, uncertain or susceptible to more than one meaning. With this, I concur. However, given the circumstances surrounding this dispute, they obviously cannot both be right.

[100] In my view, ascertaining the meaning of the words in the Definitions of Supervisor and 2IC are not only pellucidly clear on their face, but their plain, ordinary meaning is further informed by reference to the Definition of Leading Hand and to other clauses in the Agreement. This is entirely consistent with the interpretative principle of establishing the meaning of the words in their context and in the context of the Agreement, when read as a whole.

[101] In my view, the clear distinction between a permanent 2IC role and an ad hoc Leading Hand role, is readily apparent from the different ‘support’ they both provide to Supervisors as is plainly expressed in the language used in the two definitions:

• A 2IC who provides a ‘permanent and ongoing support function’; and

• A Leading Hand who provides an ‘ad hoc or temporary support’.

[102] To my mind, nothing could be clearer – surely, in the present context, ‘Permanent’ is opposite to ‘ad hoc’, and ‘ongoing’ is opposite to ‘temporary’. If the distinction needed further consideration, it is glaringly obvious that the 2IC is paid ‘at all times’, and a ‘Leading Hand’ is only paid the Leading Hand rate ‘for the relevant shift’.

[103] Similarly, the definition of a Supervisor in Cl 2.35.1, includes reference to an employee appointed as a Supervisor will be paid the Supervisor rate in Table 4 in Cl 26 ‘at all times’. Again, this stands in distinction to the Leading Hand who is only paid ‘for the relevant shift’; further demonstrating the distinction between a permanent appointment and an ad hoc appointment.

[104] A further distinction is evident in the manner of payment of the allowances for Supervisors and 2ICs by reference to an annual payment paid on a daily basis. This is to be further distinguished to ‘Incidental Allowances’ at Cl 26.8 which, as the title suggests, are paid on a weekly, daily or per occurrence basis (except for the Specialist Towing Allowance which is paid an annual allowance), pro-rated on a fortnightly basis.

[105] For these reasons, I would determine the questions posed by the parties as follows:

In appointing a Supervisor or 2IC in accordance with Cl 2.35 – Definitions – of the 2018 Agreement, Jetstar must do so on a permanent basis.

[106] The dispute is resolved accordingly, and these proceedings are concluded.

DEPUTY PRESIDENT

Appearances:

Ms L Saunders of Counsel, with Mr S Purvinas and Mr S Morgan for the Association.

Mr J Forbes of Counsel, with Ms A Agostino, Solicitor, Herbert Smith Freehills, with Mr M Zielinski for Jetstar.

Hearing details:

2020.

Sydney (via Telephone):

18 May.

Printed by authority of the Commonwealth Government Printer

Australian Licenced Aircraft Engineers' Association, The v Jetstar Airways Pty Ltd t/a Jetstar Airways

[2020] FWC 5197

7 OCTOBER 2020

DECISION