Australian Manufacturing Workers Union v Cargill Australia Limited
[2024] FedCFamC2G 168
•1 March 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Australian Manufacturing Workers Union v Cargill Australia Limited [2024] FedCFamC2G 168
File number(s): SYG 1674 of 2022 Judgment of: JUDGE LAING Date of judgment: 1 March 2024 Catchwords: INDUSTRIAL LAW – interpretation of an enterprise agreement – whether an employee was incorrectly paid by reference to the incorrect level under the agreement – whether a relevant trade qualification was required to access higher levels of pay – application dismissed Legislation: Fair Work Act 2009 (Cth) ss 50, 323 Cases cited: James Cook University v Ridd [2020] FCAFC 123; (2020) 278 FCR 566
Target Australia Pty Ltd v Shop, Distributive and Allied Employees’ Association [2023] FCAFC 66; (2023) 324 IR 304
Division: Division 2 General Federal Law Number of paragraphs: 49 Date of hearing: 1 February 2024 Place: Sydney Solicitor for the Applicant: Mr J Martin of Australian Manufacturing Workers’ Union Counsel for the Respondent: Ms V Bulut Solicitor for the Respondent: Holding Redlich ORDERS
SYG 1674 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: AUSTRALIAN MANUFACTURING WORKERS' UNION
Applicant
AND: CARGILL AUSTRALIA LIMITED
Respondent
ORDER MADE BY:
JUDGE LAING
DATE OF ORDER:
1 MARCH 2024
THE COURT ORDERS THAT:
1.The application be dismissed.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
JUDGE LAING:
By an Application and Statement of Claim filed in this Court on 18 November 2022, the applicant, Australian Manufacturing Workers’ Union (AMWU), seeks relief against the respondent, Cargill Australia Limited (Cargill), in respect of alleged contraventions of ss 50 and 323(1)(a) of the Fair Work Act 2009 (Cth) (FW Act). AMWU seeks declarations and a compensation order, as well as penalties, interest and costs.
In essence, AMWU contends that a former Cargill employee named Stephen Hopwood (Mr Hopwood) was incorrectly paid under the Cargill Australia Limited (Newcastle) Union Enterprise Agreement 2013 (2013 Agreement) from 18 November 2016 until 29 September 2019 (Claim Period). Cargill disputes this and contends that Mr Hopwood was correctly paid under the 2013 Agreement (save as for one limited underpayment which is considered below). For the reasons that follow, I accept Cargill’s contention that this was the case.
EVIDENCE
AMWU relies upon the following evidence, which has been the subject of agreed resolution regarding evidentiary objections:
(a)an affidavit of Mr Hopwood dated 15 August 2023 (Hopwood Affidavit); and
(b)an affidavit of Mr Hopwood dated 28 September 2023 (Hopwood Reply Affidavit).
Cargill relies upon a single affidavit of Nicholas Ebrill (Mr Ebrill) dated 18 September 2023 (Ebrill Affidavit). That affidavit has similarly been the subject of evidentiary objections which have been resolved by agreement between the parties.
BACKGROUND
Cargill is the Australian subsidiary of Cargill Incorporated, a global provider of food, agricultural, financial and industrial products and services: Ebrill Affidavit at [7]. Mr Hopwood was employed by Cargill and a member of AMWU.
Cargill’s operations in Newcastle primarily relate to its agricultural division. The Newcastle site spans over two locations. One is located at Raven Street, Kooragang Island and is known as the ‘Plant’ (Plant). The other is located at Heron Road, Kooragang Island and is known as the ‘Port’ (Port). Both sites are within a 2.5km drive of each other and are connected via an underground vegetable oil pipeline. Those who work at the Plant may be termed ‘Plant Employees’ (Plant Employees). Those who work at the Port may be termed ‘Port Employees’ (Port Employees): Ebrill Affidavit at [9]-[12].
Operations at the Plant include the crushing of various types of oilseeds at a facility that is owned and operated by Cargill. A portion of the oil is also refined and packed on premises. The duties of Cargill’s employees who are based at this location primarily involve oilseeds process operations, maintenance, laboratory analysis and weighbridge operation: Ebrill Affidavit at [10].
Operations at the Port include the importing and exporting of various vegetable oils out of a shipping terminal that is owned and operated by Cargill. The duties of Cargill’s employees based at this location primarily involve operating pumps to transfer oil between Plant and Port, in addition to pumping oil to and from road tankers and ships: Ebrill Affidavit at [11].
The Newcastle site originally consisted only of the Plant. All staff, other than salaried managerial staff, were employed under historical enterprise agreements. Those agreements are considered further below. In 2006, the Respondent acquired the Port division of the business: Ebrill Affidavit at [21]-[27].
Mr Hopwood was engaged by Cargill as a contractor in November 2010. He was subsequently engaged as an employee through a contract dated 26 July 2011. He ceased employment with Cargill in September 2019. Mr Hopwood worked as a Terminal Operator at the Port: Agreed Chronology.
THE ENTERPRISE AGREEMENTS
The enterprise agreements approved between 1996 and 2007 only applied to Plant Employees: Ebrill Affidavit at [33]-[34]. Historically, they applied to qualified tradespeople. This was because the work was skilled work that would typically be performed by persons with a relevant trade qualification: Ebrill Affidavit at [25].
The first collective agreement entered into between Cargill, AMWU, and certain Cargill employees following the acquisition of the Port was the Cargill Australia Limited, (Newcastle), Union Collective Agreement 2007 (2007 Agreement): Ebrill Affidavit at [31]; p 312 of the Court Book (CB).
Pay rates were provided for under the historical agreements by reference to Schedule A, which specified different rates of pay for different skill levels. This practice was continued under the 2007 Agreement.
The 2007 Agreement further introduced Schedule B. The first headings under this description introduced the following “classification structure[s]” (CB 349):
The “Level[s]” identified in Schedule B corresponded with the levels that determined pay under Schedule A.
The 2007 Agreement only applied to Plant Employees. In contrast, the Cargill Australia Limited (Newcastle) Union Enterprise Agreement 2010 (2010 Agreement) included provision for Port Employees: cl 3, CB 355. This was reflected in:
(a)the reference to employees employed at the "Newcastle Port" in clause 3;
(b)the insertion of the words "*Classification structure to include Port employees” immediately under the “SCHEDULE ‘B’” heading; and
(c)the insertion of duties under a heading “PORT LEVELS”, appearing after the “SCHEDULE ‘B’” heading and a heading of “PERIPHERAL DUTIES”.
Although the pay table under Schedule A followed a heading “Newcastle Plant Employees”, it was not disputed that this also applied to Port Employees.
The 2013 Agreement (CB 405) relevantly amended the 2010 Agreement by replacing the reference to “Seed tester” in classification “Level a” (Level A) with “Non Trade Qualified Operator”. The resulting wording immediately under Schedule B read as follows:
Under this, the following was stated:
This was followed by:
After this, required duties for three “LEVELS” were stated under the heading “PORT LEVELS”. Of greatest relevance to the present dispute were Levels 1 and 2, which were set out as follows:
Level 3 set out a series of duties under the heading “LEVEL 3” and general reference to the following: “Supervise Operations of the terminal whilst Manager is on Leave or off site for extended periods”.
Clause 20.1(a) and (b) of the 2013 Agreement read as follows:
ISSUES
The parties agree that the threshold issue in this matter is one of construction. AMWU contends that Mr Hopwood was not required to hold a trade qualification to be entitled to be paid at either the Level 1 or Level 2 rate under the 2013 Agreement. Cargill contends that on a proper construction of the 2013 Agreement, Mr Hopwood was required to hold a relevant trade qualification.
If the first issue is resolved in its favour, AMWU contends that Mr Hopwood was entitled to be classified and remunerated for performing the duties of a Level 2, or, in the alternative, a Level 1 Port Employee. Cargill disputes that it has been sufficiently demonstrated that Mr Hopwood should have been classified under Level 2.
PRINCIPLES
The parties do not relevantly dispute the principles to be applied, which have been helpfully set out in their respective submissions.
A recent summary of relevant principles regarding the interpretation of enterprise agreements was provided in James Cook University v Ridd [2020] FCAFC 123; (2020) 278 FCR 566 (James Cook University) at [65] as follows (per Griffiths and SC Derrington JJ):
(i)The starting point is the ordinary meaning of the words, read as a whole and in context (City of Wanneroo v Holmes [1989] FCA 553; 30 IR 362, 378; City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union [2006] FCA 813; 153 IR 426 [53]; WorkPac Pty Ltd v Skene [2018] FCAFC 131; 264 FCR 536 [197]).
(ii)A purposive approach is preferred to a narrow or pedantic approach — the framers of such documents were likely to be of a “practical bent of mind” (Kucks v CSR Limited [1996] 66 IR 182, 184; Shop Distributive and Allied Employees’ Association v Woolworths SA Pty Ltd [2011] FCAFC 67 [16]; WorkPac Pty Ltd v Skene [2018] FCAFC 131; 264 FCR 536 [197]). The interpretation “turns upon 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] HCA 10; 222 CLR 241 [2]).
(iii)Context is not confined to the words of the instrument surrounding the expression to be construed (City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union [2006] FCA 813; 153 IR 426 [53]). It may extend to “… the entire document of which it is a part, or to other documents with which there is an association” (Short v FW Hercus Pty Ltd [1993] FCA 51; 40 FCR 511, 518; Australian Municipal, Administrative, Clerical and Services Union v Treasurer of the Commonwealth of Australia [1998] FCA 249; 82 FCR 175, 178).
(iv)Context may include “… ideas that gave rise to an expression in a document from which it has been taken” (Short v FW Hercus Pty Ltd [1993] FCA 51; 40 FCR 511, 518).
(v)Recourse may be had to the history of a particular clause “Where the circumstances allow the court to conclude that a clause in an award is the product of a history, out of which it grew to be adopted in its present form…” (Short v FW Hercus Pty Ltd [1993] FCA 51; 40 FCR 511, 518).
(vi)A generous construction is preferred over a strictly literal approach (Geo A Bond and Co Ltd (in liq) v McKenzie [1929] AR 499, 503-4; City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union [2006] FCA 813; 153 IR 426 [57]), but “Awards, whether made by consent or otherwise, should make sense according to the basic conventions of the English language. They bind the parties on pain of pecuniary penalties” (City of Wanneroo v Holmes [1989] FCA 553; 30 IR 362, 380).
(vii)Words are not to be interpreted in a vacuum divorced from industrial realities but in the light of the customs and working conditions of the particular industry (City of Wanneroo v Holmes [1989] FCA 553; 30 IR 362, 378-9; WorkPac Pty Ltd v Skene [2018] FCAFC 131; 264 FCR 536 [197]).
As a general principle of construction, one should strive to give meaning and effect to all language in the document interpreted: see James Cook University at [72].
RESOLUTION
The parties accepted that the “threshold issue” in this matter was whether Mr Hopwood was required to hold a trade qualification in order to access the Level 1 or Level 2 rates of pay. AMWU accepted that if this were required, then AMWU’s claim for relief could not be made out.
AMWU submitted that there was no requirement under the 2013 Agreement for Mr Hopwood to have held a trade qualification in order to access pay Levels 1 or 2. Cargill contended that Mr Hopwood was required to hold a trade qualification in order to access any rate of pay above Level A.
AMWU accepted that Mr Hopwood was not “trade qualified” for the purposes of the 2013 Agreement. Therefore, if it were a requirement that he be such in order to access Level 1 or Level 2 rates of pay, then he could not meet this. He would therefore have been correctly classified as being entitled to the Level A rate of pay.
However, AMWU contended that this level and the “Classification Structure[s]” identified in the top section of the first page of Schedule B only applied to Plant Employees. It was agreed between the parties that the section above “PERIPHERAL DUTIES” entitled “How do employees progress to the new Level” only applied to such employees. AMWU contended that this limitation similarly applied to the above stated “Classification Structure[s]”. AMWU contended that the inclusion of “PORT LEVELS” in the 2010 Agreement, which were transplanted into the 2013 Agreement, created a separate classification structure for Port Employees. It was submitted that those classifications did not require any trade qualification.
AMWU submitted that this interpretation was supported by the following:
(a)Firstly, by the initial classification under the “PORT LEVELS” stating “Level 1 – Entry Level”. It was submitted that no classification could conceivably be below an “entry level” position.
(b)Secondly, by the lack of duties set out under “PORT LEVELS” for Level A or Level 4. That is because, it was submitted, Level A and Level 4 did not exist as classifications under the “PORT LEVELS”.
(c)Thirdly, by the duties described under “PORT LEVELS” 1 to 3 not requiring a trade qualification in order to have been performed: Annexures SH-4, SH-5, SH-6 and SH-7 to the Hopwood Affidavit; Ebrill Affidavit at [48]-[49].
(d)Fourthly, by the work at the Plant being more diverse and complex, requiring qualified tradespeople: Hopwood Reply Affidavit at [5]; Ebrill Affidavit at [25].
AMWU further submitted that its interpretation was supported by the evolution of the historical agreements within the context of objective background facts. In particular, AMWU emphasised that the application of Level A under the 2010 Agreement to Port Employees would have made no sense, in circumstances where there was no Port “Seed tester” or other provision made for a Non Trade Qualified Operator. The substantial reflection of the language in that agreement (albeit with the replacement of the expression “Seed tester”) was said to support AMWU’s interpretation of the 2013 Agreement.
I am unable to accept AMWU’s contentions, having regard to the wording of the 2013 Agreement.
In particular, I accept Cargill’s contention that the wording “*Classification structure to include Port employees” immediately before the two expressly identified “Classification Structure[s]” (namely, “Classification Structure Non Trade Qualified Operator” and “Classification Structure Trade Qualified Operator”) compels a conclusion that this bifurcation of the classification structures (according to whether a person was or was not trade qualified) “include[d] Port employees”.
The words “*Classification structure to include Port employees” must be given work to do in the agreement. In this regard, the unity of the language used and its position in the 2013 Agreement is telling. I consider it an unlikely construction that such wording would have been positioned immediately above expressly identified “Classification Structure[s]” had those “Classification Structure[s]” not been intended to apply to Port Employees.
The subsequent reference under “PORT LEVELS” to “Level 1 – Entry Level” is explicable by reference to this being the first or “entry” level under the “Trade Qualified Operator” classification. This did not preclude the existence of a lower paid Level A under the “Non Trade Qualified Operator” classification.
The non-inclusion of Level A under the “PORT LEVELS” is similarly explicable. As Cargill submitted, there was no need to delineate the duties of different levels under the “Non Trade Qualified Operator” classification in circumstances where only one level applied by reference to a lack of trade qualification. I accept that duties for Level 4 were also not included under the “PORT LEVELS”. However, this may be, as was submitted by Cargill, because it was not contemplated at the time that Port Employees would progress to that level. This did not preclude the overall “Classification Structure[s]” identified under Schedule B from generally applying to Port Employees, even if one level was unable to be reached.
I accept that the duties described under “PORT LEVELS” 1 to 3 did not necessarily require a trade qualification in order to have been performed. The evidence shows that Mr Hopwood was performing a significant number of duties under Levels 1 and 2. However, this does not mean that the additional wording regarding the requirement of trade qualification did not apply to prevent Mr Hopwood’s ascension to Levels 1 to 3 of the “Trade Qualified Operator” classification.
The relative diversity or complexity of the work at the Plant and Port does not alter this conclusion. As was submitted by Cargill, it is not necessarily clear why a qualified Level 2 tradesperson in the Plant would, on AMWU’s interpretation, have been paid less than a Level 3 unqualified trade operator in the Port if the work there involved less complexity. Regardless, it is not the Court’s role to decide what might have been a fair or preferable agreement. The role of the Court is to interpret the agreement that is before it. As was submitted for AMWU, a range of factors may influence the drafting of an enterprise agreement. Not all of those will necessarily depend upon the objective value or role of the work performed: see Target Australia Pty Ltd v Shop, Distributive and Allied Employees’ Association [2023] FCAFC 66; (2023) 324 IR 304 at [55]-[56] per Bromberg J.
AMWU’s additional submission regarding the evolution of the agreements, particularly by reference to the 2010 Agreement, similarly cannot alter this conclusion. The evidence regarding the situation at the time that the 2010 Agreement came into existence is not entirely clear. AMWU directed attention to the Hopwood Reply Affidavit at [8], where it was stated:
8.In relation to paragraph 53(b), there were numerous non-trade qualified operators employed at the Plant when I was still employed by Cargill. I cannot recall specifically how many there were.
Paragraph 53(b) of the Ebrill Affidavit records that between the dates of 1 January 2008 and 20 September 2019, Cargill employed 19 employees without any trade qualification that were classified and paid as Level A employees.
However, the above evidence appears to refer holistically to employees who were employed at various times over the course of a lengthy date range. It does not establish whether there were non-trade qualified employees at the Port at the particular time when the 2010 Agreement was reached. It is therefore difficult to evaluate whether there were non-trade qualified Port Employees at that time, who were not “Seed tester[s]” at that particular point, such that the application of a Level A classification to those employees under the 2010 Agreement was problematic.
I accept that Mr Hopwood was employed in July 2011, purportedly under the Level A classification in the 2010 Agreement, notwithstanding that his role was not that of a “Seed tester”: Annexure SH-1 to the Hopwood Affidavit (CB 69). However, his period of employment under that agreement falls outside of the Claim Period. By the time of the 2013 Agreement, [42(a) and (b)] of the Ebrill Affidavit evidences that:
(a)the seed tester at the Plant had since obtained a trade qualification and transitioned to the Trade Qualified Operator structure as a fitter operator within the crush operations of the Plant; and
(b)the employees who were classified and being paid by the Respondent as "level a" employees at that time were all non-trade qualified employees working either at the Plant or, in the case of Mr Hopwood, at the Port, as terminal, oil loadout or packaging plant operators. For example, since the packaging plant area of the Plant had been built in 2009, its workers worked in teams of 3 employees each shift, comprised of 1 trade qualified operator and 3 non-trade qualified operators.
Within this context, the 2013 Agreement broadened the Level A classification from “Seed tester” to “Non Trade Qualified Operator”. Therefore, even if there were issues with applying this classification to Port Employees under the 2010 Agreement, this appears to have been rectified by the 2013 Agreement.
For the above reasons, Cargill’s construction of the 2013 Agreement must be accepted.
It follows that the application before this Court must be dismissed. Although a relatively small underpayment was agreed by the parties in relation to superannuation, Cargill has undertaken to pay this. AMWU did not seek any orders for relief in respect of that amount in the event that its construction argument regarding the 2013 Agreement was not accepted.
CONCLUSION
For the above reasons, the application before the Court must be dismissed.
I certify that the preceding forty-nine (49) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Laing. Associate:
Dated: 1 March 2024
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