Australian Nuclear Science and Technology Organisation v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers' Union (AMWU)
[2011] FWA 6470
•23 SEPTEMBER 2011
[2011] FWA 6470 |
|
DECISION |
Workplace Relations Act 1996
s 709 - Application to FWA to have a dispute resolution process conducted (Div 5)
Australian Nuclear Science and Technology Organisation
v
Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers’ Union (AMWU)
(DR2011/193)
DEPUTY PRESIDENT SAMS | SYDNEY, 23 SEPTEMBER 2011 |
Dispute over correct payment to 12 hour shift workers when rostered off on a public holiday - meaning of ‘day’ under the Award - principles of construction - calculation based on a standard day and not a 12 hour shift..
[1] The Australian Nuclear Science and Technology Organisation (‘ANSTO’) has lodged an application under s 709 of the Workplace Relations Act 1996 (‘the WR Act’), to have Fair Work Australia (‘FWA’) deal with a dispute in accordance with the Grievance and Dispute Settlement Procedure (Cl 8.8) under the Australian Nuclear Science & Technology Organisation Enterprise Agreement 2009 - 2011 (‘the Agreement’). The Agreement is a certified agreement made under the WR Act. The Agreement is to be read in conjunction with the Australian Nuclear Science & Technology Organisation (General) Award 2000 (‘the Award).Clause 8.8 of the Agreement envisages that the parties empower the Australian Industrial Relations Commission (‘AIRC’) (and now FWA) to resolve the dispute. Those powers do not permit FWA to make orders in settlement of the dispute (s 711 of the WR Act) and the parties, being ANSTO and the AMWU (the Union), have submitted to the Tribunal that a recommendation in the arbitrated proceedings will be accepted by them. I note that earlier attempts by FWA to resolve the dispute, through conciliation, were unsuccessful.
[2] Shortly stated, the dispute relates to the correct payment to 12 hour shift workers when rostered off on a public holiday. ANSTO’s position is that the payment should be calculated on the basis of a shift being a standard day (7.35 hours), whereas the Union maintains that the calculation should be made by reference to the shift they would have otherwise worked; namely, 12.17 hours. It was agreed between the parties that the Agreement is silent on the issue. However, ANSTO’s position is what is currently being applied. The present difficulty has seemingly arisen following the introduction of 12 hour shifts earlier this year for around 19 operators on the OPAL reactor. It is noted that shift and non shift workers work the equivalent number of hours per year.
[3] However, Clause 18.16 of the Award provides for averaging of shift payments and agreement with affected employees, as follows:
18.16 Averaging of shift payments
18.16.1 Average pay arrangements for shift workers will be implemented following agreement between ANSTO and a majority of affected employees employed in the relevant area.
18.16.2 Such an arrangement provides that all payments normally made to shift workers including salary, will be totalled on a per annum basis and subsequently averaged on a fortnightly basis for the purposes of payment.
18.16.3 The relevant union(s) is to be given a reasonable opportunity to represent any affected member(s) in discussions regarding the averaging arrangements.
[4] These arrangements were detailed in a Memorandum of Understanding (‘MOU’). A majority of the affected staff have signed the MOU and commenced working the new shifts from 20 March 2011. The MOU provides for a shift loading of 34 per cent, based on calculating the number of shifts worked over a 10 week cycle and applying the penalties that would otherwise apply, including a projected number of public holidays worked and not worked.
[5] It is also also clear that the MOU foreshadowed the resolution of this dispute in terms of Cl 7(a) which is as follows:
Public Holiday Payment When Rostered Off
The average shift loading identified in this Clause includes a component representing payment for shift workers when Rostered Off on a Public Holiday as per Clause 18.12 of the ANSTO Award. The payment is based on a standard day of 7.35 hrs when Rostered Off in a Public Holiday.
ANSTO management and employees covered by the Memorandum of Understanding (MOU) agree to seek independent advice through an agreed conciliator on determining the number of house to be paid when Rostered Off on a Public Holiday (i.e. either 7.35 hours or 12.17 hours). ANSTO management and employees agree to seek resolution on this matter within 3 months from the date of signing this MOU and agree to accept the recommendation of the independent conciliator.
Any subsequent increase of the average shift loading will be applied retrospectively to the commencement date of the roster covered by this MOU.
[6] While the present dispute is confined to the OPAL operations and 19 employees, any determination by FWA, in the Union’s favour, will have a significant flow on effect to other shift workers who might move to 12 hour shifts (presently around 95). ANSTO estimates the additional cost as being around $200,000 per annum. I have no reason to doubt these assumptions.
[7] As mentioned earlier, the Agreement contains no provision dealing with the treatment of rostered days off falling on a public holiday. ANSTO relies on Cl 18.12 of the Award, which contains the following provision:
Rostered days off on public holidays
A shift worker will be granted a day’s leave in lieu of a rostered day off which falls on a public holiday. The one-day leave in lieu will be granted and taken no more than one month after the public holiday to which it relates. Where it is not practicable to grant or take a day’s leave, the employee will be paid one-day’s pay at the ordinary rate instead.
Cl 5.15 of the Award defines a ‘standard day’ as
...either the period of 7 hours and 21 minutes on any week day between 8.45 a.m. to 1.00 p.m. and 1.50 p.m. to 4.56 p.m., or such other hours, as are agreed under this award under 16.5 (flexible working hours)
(Cl 16.5 does not apply to shift workers).
It was the primary submission of ANSTO that as the Agreement is silent on the issue of rostered days off falling on a public holiday, the Award provisions must be applied.
[8] ANSTO addressed the industrial context of Cl 18.12 after citing the following authorities which have developed principles of construction to be applied by the Courts in interpreting the provisions of industrial instruments: see Vision Super Pty Ltd v Poulter (2006) 154 FCR 185; Ansett Australia Ltd (Subject to Deed of Company Arrangement) v Australian Licenced Aircraft Engineers Association [2003] FCAFC 209; Australasian Meat Industry Employees’ Union v Coles Supermarkets Australia Pty Ltd (1998) 80 IR 208; Hawkins v Commonwealth Bank of Australia (No 2) (1996) 70 IR 213; Kucks v CSR Ltd (1996) 66 IR 182; Re Andrew John Short v FW Hercus Pty Ltd (1993) 40 FCR 511. The Union did not disagree with the principles established by the cited authorities.
[9] ANSTO’s submissions concentrated on the seminal case on the subject of shift work in the NSW industrial jurisdiction - the Shift Workers Case (1972)AR 633. In that case, after referring to the different approaches taken by the Court to the treatment of rostered days off falling on a public holiday, the Full Bench of the Commission in Court Session held:
When any shift worker whose ordinary working time includes public holidays is rostered off on a public holiday and he does not work on that holiday he should have a day’s pay added to his annual leave or he should receive a day’s pay.
ANSTO submitted that this finding meant that the payment of a day in lieu of annual leave should be commensurate with the pay that a shift worker would have received had they taken a day of annual leave, as the objective was to put shift workers on an equal footing with day workers (see p 662).
[10] Subsequent cases, including those of the AIRC, adopted the reference of a rostered public holiday off to an additional ‘day’ (be it of annual leave or an additional days’ wages) and not by reference to a shift: see Health Services Union of Australia v The Queen in right of the State of Victoria [Print L9178, 20 March 1995, C No 31467 of 1992]; Health Services Union of Australia v The Queen in right of the State of Victoria [Print L4534, 4 August 1994, C No 31467 of 1992]. ANSTO also relied upon the Macquarie Dictionary (2nd ed) definition of ‘ordinary pay’, which had been cited with approval by Madgwick J in Kuck’s Case at p 186, being, ‘ordinary pay...remuneration for an employee’s normal weekly number of hours fixed under the terms of his employment but excluding any amount payable to him for shift work, overtime or other penalty.’
[11] In the result, ANSTO submitted the following:
(a) The Agreement is to be read in conjunction with the Award. Since the Agreement is silent on the issue of rostered days off falling on a public holiday the Award term should be applied.
(b) The Award enables the employee to receive one-day’s pay at the ordinary rate of pay instead of a day of leave. This employee benefit in clause 18.12 of the Award, is characterised by reference to a day’s pay at the ordinary rate not by reference to a shift (including a 12 hour shift). A day’s pay is not interchangeable with the hours worked on a shift.
(c) The ordinary meaning or usual meaning of ‘one-day’s pay at the ordinary rate’ should be applied.
(d) The ordinary rate for one day’s pay based on the normal weekly number of hours fixed under terms of the Agreement (being 36 ¾ hours), is 7 hours and 21 minutes (defined as a standard day in the Award) paid at the employees hourly rate.
(e) Employees ordinarily receive a payment equivalent to 7 hours and 21 minutes for each day of work, irrespective of whether a 12 hour shift is worked on a particular day.
(f) Employees ordinarily receive a payment equivalent to 7 hours and 21 minutes when on a day of leave. The payment of one-day’s pay in lieu of an additional day of leave should not result in the employee receiving a higher payment than they would have received had they taken the additional day of leave. The alternatives outlined in clause 18.12 of the Award should be of equal value; an employee should not receive a higher payment if the payment in lieu option is applied instead of the additional day of leave. This thinking is supported by the case law on this issue.
(g) The effect of an employee receiving a payment for a 12 hour shift in lieu of a day of leave would not result in the employee being on equal footing with a day worker.
(h) To apply clause 18.12 in such a way would be contrary to the source of this award term as established in the New South Wales and Federal test case standards. This result would be contrary to the industrial context of this kind of award term.
The Union did not seek to put any further submissions on the issue in dispute.
CONSIDERATION
[12] At the outset, I would wish to emphasise two obvious matters - firstly, this dispute concerns the payment for time not worked, rather than the opposite. Secondly, there is no provision in the Agreement dealing with the appropriate treatment of a public holiday which falls on a 12 hour shift worker’s rostered day off. It must follow that as the Agreement is not a stand alone instrument, to the exclusion of all other awards or agreements, and is to be read in conjunction with the Agreement, then it is necessary to rely on the provisions of the Award; assuming they are relevant to the issue in dispute. So much so is evident by the express wording of Cl 1.6 of the Agreement.
[13] Having established that foundation, it seems to me that the task of the decision maker is to interpret the meaning of the word ‘day’ in Cl 18.12. More particularly, the question to be asked is appropriately characterised as: does a day mean a day as elsewhere defined in the Award or a shift, being the 12 hours an employee would usually work if he/she was rostered on a public holiday?
[14] The principles applying to the construction of awards were helpfully identified by the parties in the list of decisions earlier referred to. To the weight of these authorities may be added some more recent decisions, which I hasten to add do not conflict with those earlier cited. They demonstrate the contemporary application of the same principles to a specific set of circumstances.
[15] A Full Bench of the Federal Court in Shop Distributive and Allied Employees’ Association v Woolworths SA Pty Ltd [2011] FCAFC 67, said at para 14-18:
14. Support for the position that the industrial context and the intention or purpose of the makers of an industrial instrument should be paramount notwithstanding the strict wording of the document is found in the judgments of members of the High Court in Amcor Limited v Construction, Forestry, Mining and Energy Union [2005] HCA 10; (2005) 222 CLR 241.
15. In Amcor, Gleeson CJ and Mc Hugh J stressed at paragraph [2] that:
(t)he resolution of the issue turns upon the language of the particular agreement, understood in the light of its industrial context and purpose, and the nature of the particular reorganisation.
See also at paragraph [13], where their Honours referred to:
...the industrial purpose of the agreement, and the commercial and legislative context in which it applies.
16. Further, the purposive approach to the construction of industrial instruments was persuasively illustrated by Kirby J in Amcor at paragraph [96] where his Honour said:
The nature of the document, the manner of its expression, the context in which it operated and the industrial purpose it served combine to suggest that the construction to be given to cl 55.1.1 should not be a strict one but one that contributes to a sensible industrial outcome such as should be attributed to the parties who negotiated and executed the Agreement. Approaching the interpretation of the clause in that way accords with the proper way, adopted by this Court, of interpreting industrial instruments and especially certified agreements. I agree with the following passage in the reasons of Madgwick J in Kucks v CSR Ltd, where his Honour observed:
It is trite that narrow or pedantic approaches to the interpretation of an award are misplaced. The search is for the meaning intended by the framer(s) of the document, bearing in mind that such framer(s) were likely of a practical bent of mind: they may well have been more concerned with expressing an intention in ways likely to have been understood in the context of the relevant industry and industrial relations environment than with legal niceties or jargon. Thus, for example, it is justifiable to read the award to give effect to its evident purposes, having regard to such context, despite mere inconsistencies or infelicities of expression which might tend to some other reading. And meanings which avoid inconvenience or injustice may reasonably be strained for. For reasons such as these, expressions which have been held in the case of other instruments to have been used to mean particular things may sensibly and properly be held to mean something else in the document at hand.
(Original emphasis.)
See also per Gummow, Hayne and Heydon JJ at [30].
17. The approach of the High Court in Amcor is consistent with the modern approach to interpretation of commercial agreements where context and surrounding circumstances will be taken into account “even if the words at issue are not ambiguous, or susceptible of more than one meaning”; see Lion Nathan Australia Pty Ltd v Coopers Brewery Ltd [2006] FCAFC 144; (2006) 156 FCR 1 at paragraph [46], per Weinberg J and see also at paragraph [251] where Lander J said:
It is now clear and settled law that the meaning of commercial contracts and documents is to be determined objectively. To determine the objective intention of the parties regard must be had, of course, to the words in the document themselves, but regard should also be had to all of the surrounding circumstances which were known to the contracting parties at the time the document was created including the underlying purpose and object of the commercial transaction: Pacific Carriers per Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ at [22].
18. What is true of commercial contracts and their construction is also true of the construction of industrial agreements where regard must be had to the industrial context and the purpose of the provisions in question. In that regard, see also Short v FW Hercus Pty Ltd [1993] FCA 51; (1993) 40 FCR 511, especially at 518 to 520 per Burchett J, and City of Wanneroo v Holmes [1989] FCA 369; (1989) 30 IR 362 at 378 per French J. The issue currently in contest between the parties may fairly be resolved by asking the following question: given the purpose of public holiday provisions and the purpose of creating additional public holidays, could it be reasonably intended by industrial parties to an industrial instrument that a person would be entitled to the benefit of a public holiday for Anzac Day and on the very next day the provision of another public holiday for Anzac Day? The answer is obvious and must be no.
In Australian and International Pilots Association v Qantas Airways Limited and Jetconnect Limited [2011] FWAFB 3706 (6 September 2011), Boulton J, Hampton C (Drake SDP not dissenting on the principles of construction)said at para 73 - 78:
[73] The general principles governing the construction of contracts have been applied to the construction of industrial instruments. 22 In Codelfa Construction Pty Ltd v State Rail Authority of N.S.W23 the High Court considered the widely accepted principles for resolving ambiguity in contracts. In that case Mason J (with whom Stephen and Wilson JJ agreed) stated the rule as follows:
“The true rule is that evidence of surrounding circumstances is admissible to assist in the interpretation of the contract if the language is ambiguous or susceptible of more than one meaning. But it is not admissible to contradict the language of the contract when it has a plain meaning. Generally speaking facts existing when the contract was made will not be receivable as part of the surrounding circumstances as an aid to construction, unless they were known to both parties, although, as we have seen, if the facts are notorious knowledge of them will be presumed.” 24
[74] In the present case, the starting point is essentially a question of construction: to determine whether the clause has a plain meaning or contains an ambiguity. This involves a consideration of the intent - objectively ascertained - of the award-maker. 25 It is a consideration of what is the proper meaning of the clause as distinct from the making of a judgment as a matter of arbitral discretion as to what the clause should provide.
[75] As Madgwick J said in Kucks v CSR Limited 26:
It is trite that narrow or pedantic approaches to the interpretation of an award are misplaced. The search is for the meaning intended by the framer(s) of the document, bearing in mind that such framer(s) were likely of a practical bent of mind: they may well have been more concerned with expressing an intention in ways likely to have been understood in the context of the relevant industry and industrial relations environment than with legal niceties or jargon.
...
But the task remains one of interpreting a document produced by another or others. A court is not free to give effect to some anteriorly derived notion of what would be fair or just, regardless of what has been written into the award. Deciding what an existing award means is a process quite different from deciding, as an arbitral body does, what might fairly be put into an award. So, for example, ordinary or well-understood words are in general to be accorded their ordinary or usual meaning.
[76] The industrial purpose of an award provision is a relevant consideration in construing its meaning. However as was observed by Jessup J in Chief Commissioner of Police v Kerley 28:
Care must ... be taken not to perceive a particular industrial purpose in a combination of contemporary circumstances that differs from those obtaining when the words were written. I also consider that, generally, the words used by the award maker should be the starting point for the ascertainment of his or her purpose.
[77] In our view, the words and intent of clause 5 of the Award are clear. The words of the clause make it clear that the employer bound by the Award is Qantas, “the Company”, and that it is binding upon Qantas in respect of pilots “employed by the Company in operations known as Qantas short haul operations.” There is nothing in the wording of the clause indicating that the award-maker intended the Award to cover subsidiary companies of Qantas or that the parties to the Award saw the Award or its predecessors as applying to subsidiaries or to an operation such as that of Jetconnect. It is not sufficient for a party simply to assert that an award provision has a particular meaning or application and then to rely upon such assertion as establishing that there is uncertainty or ambiguity in the provision. The meaning of the provision and the existence of an ambiguity must be objectively ascertained.
[78] It is also relevant in the construction exercise to consider the history of the Award and the full context of the award clause. 30 This includes the context of the clause in the Award and the context within which the Award was made including the relevant statutory provisions. Such a consideration confirms the conclusion reached regarding the meaning of the words of the clause. It has not been demonstrated that there is anything in the other provisions of the Award which indicates that the Award was intended to bind Jetconnect or to apply to pilots employed by Jetconnect. Further the legislative environment in which the 1996 award was made required that there be a finding of an industrial dispute between the relevant employees and one or more identified employer or an employer association. The award made in settlement of that dispute would only be binding upon those parties, although an application could be made to the Australian Industrial Relations Commission by a registered organisation of employees to “rope in” a new employer. Such a roping-in application could have been made up to 2006, when the WR Amendment Act took effect. The only employer party to the dispute which lead to the making of the Award and which continued to be bound by the Award was Qantas.
In addition, I note that His Honour, Watson SDP, recently summarised the principles of agreement construction in Thiess Degremont Joint Venture v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers’ Union (AMWU) [2011] FWA 6490. At para 12, His Honour said:
• A statutory industrial agreement is to be construed having regard to its industrial purpose and the commercial and legislative context in which it applies;
• Care should be taken to avoid too literal adherence to the strict technical meaning of words in favour of a meaning consistent with the general intention of the parties, having regard to the instrument as a whole;
• Regard might be had to the arbitral history of relevant award provisions in interpreting an agreement provision;
• A narrow or pedantic approach to interpretation should be avoided in favour of a search for the meaning intended by the framers of a document, as persons with a practical bent of mind;
• Meanings which avoid inconvenience or injustice may reasonably be strained for;
• The circumstances of the origin and use of a clause are relevant to an understanding of what was intended by the drafters;
• The context of an expression may extend beyond the words that are its immediate neighbours;
• The task is one of interpreting a document produced by others and effect should not be given to some interiorly derived notion of what would be fair or just, regardless of the terms of the instrument;
• Ordinary or well understood words are generally to be accorded their ordinary or usual meaning;
[16] I turn now to address the specifics of the circumstances of this case. In my opinion, there is no ambiguity in the words used in Cl 18.12 of the Award. A ‘day’ must mean what it says it means at Cl 5.15 - i.e. 7 hours and 21 minutes. This conclusion is strengthened by the reference to a shift worker being paid one day’s pay ‘at the ordinary rate’. It is also consistent with an intention not to provide a shift worker with any higher compensatory amount than would be payable for a day worker in the same circumstances. The Macquarie Dictionary definition of ‘ordinary pay’ is also helpful in this respect. Ordinary pay is defined as exclusive of shift work payments.
[17] Given the express and unequivocal meaning of the words used, I do not see how it is possible to define a ‘day’ by reference to a shift. While I accept that the concept of a 12 hour shift was not contemplated at the time of the making of the 1990 Award, I am fortified to my views in this matter, by the industrial purpose of the provision and the context from which it was derived. In this respect, and notwithstanding the passage of time, I believe the Shift Workers Case of 1972 espoused the correct approach to the treatment of a public holiday falling on a shift workers’ rostered day off. The findings in that case were plainly not predicated on the length of the shift, but sought to rationalise an approach which ensured shift workers and day workers were on the same footing. In this respect, I refer to page 662 of the judgment, where the Full Bench said:
We think that in the circumstances of today weight should be given to the fact that a shift worker (whether a 7-day or 6-day shift worker) who is rostered off and does not work on a public holiday receives no benefit over and above his normal day off unless a provision of this kind is made. Although he is free from work, he does not gain the same advantage from the holiday as the general body of employees in the community. Cf. per Kinsella J. in the 1948 Steel Works Case. It is true that he receives his full week’s wages but this is for 40 hours work while the day worker receives the holiday in addition to his normal days off and thus receives payment for 40 hours although he works only 32. We think that on this question the ordinary principles relating to payment for public holidays not worked need modification and we decide that any shift worker whose ordinary working time includes public holidays should have a day added to his annual leave or should receive a day’s pay when he is rostered off and does not work on a public holiday. This will give him 48 hours pay or its equivalent for 40 hours work and will place him on equal footing with the day worker who receives pay for a day more than he actually works. It will also, as we have said, place all shift workers on an equal footing. This is another decision of general application in the sense we have mentioned when dealing with weekend penalty rates and we intend that it be given effect to accordingly.
[18] It also seems pellucidly clear that the more recent treatment of a public holiday not worked was directed towards compensation by reference to ‘day/s’, rather than ‘shift/s’. The Full Bench of the AIRC in Health Services Union of Australia v The Queen in right of the State of Victoria [Print L9178, 20 March 1995, C No 31467 of 1992], said at 2 - Full Time Workers:
We refer to here to full-time workers who do not regularly work a five-day, Monday - Friday week. Such workers include persons who work regularly on Saturday or Sunday, workers with variable rosters, continuous shift workers and employees who work for nine days per fortnight or 19 days in each four weeks. This list is not intended to be exhaustive.
It may happen that a prescribed holiday falls upon a day when the employee would not be working in any event. Fairness requires that the worker be not disadvantaged by that fact. The appropriate compensation, we think, is
● An alternative ‘day off’; or
● an addition of one day to annual leave; or
● an additional day’s wages.
We understand that such compensation is already provided in many awards.
[19] Given the authorities I have referred to above, I consider that a ‘day’ in Cl 18.12 of the Award means 7.35 hours and consequently, in the calculation of a 12 hour shift worker’s salary, the component relevant to work not performed on a public holiday shall be by reference to 7.35 hours and not 12.17 hours. Despite this finding, I note that the Agreement has a nominal expiry date of 9 November this year. It would seem to me that if there is a desire of the parties to change this arrangement through negotiations for a new Agreement, that this would be the appropriate time to revisit the matter.
DEPUTY PRESIDENT
Appearances:
Mr T Rodney, Industrial Relations Manager of the applicant
Mr C Drane, Australian Worker’s Union
Hearing details:
2011
SYDNEY
22 June
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