Australian Nursing Federation v Presbyterian Care Tasmania

[2013] FWC 5317

[2013] FWC 5317 Note: An appeal pursuant to s.604 (C2013/5737) was lodged against this decision - refer to Full Bench decision dated 18 October 2013 for result of appeal.

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

Australian Nursing Federation
v
Presbyterian Care Tasmania
(C2013/2833)

Aged care industry
DEPUTY PRESIDENT GOOLEY	MELBOURNE, 6 AUGUST 2013

Alleged dispute concerning call back arrangements.

Introduction

[1] The Australian Nursing Federation (ANF) notified a dispute pursuant to s.739 of the Fair Work Act 2009 (the Act).

[2] The ANF, the Health Services Union (HSU) and the Presbyterian Care Tasmania (the Respondent) are bound by the Presbyterian Care Tasmania Incorporated Nurses Agreement 2011 1(the Agreement).

The matter in dispute

[3] The dispute with the Respondent centred on what employees, who are called back to work, should be paid.

[4] The ANF submitted that employees who are called back to work are entitled to a minimum payment of four hours or three hours, as the case may be, at overtime rates.

[5] The Respondent submitted that whilst employees who are called back to work are paid at overtime rates, the minimum payment must be equal to either four hours pay at ordinary time or three hours pay at ordinary time.

[6] The difference between the parties is best shown by a table.

Hours worked on a Saturday	The ANF	The Respondent
1	2x1.5 + 2x2=7 hours pay	1x1.5 therefore 4 hours pay
2	2x1.5 + 2x2=7 hours pay	2x1.5 therefore 4 hours pay
3	2x1.5 + 2x2=7 hours pay	2x1.5+1x2 =5 hours pay
4	2x1.5 + 2x2=7 hours pay	2x1.5+2x2= 7 hours pay

The industrial instrument

[7] The Agreement at clause 33 provides for grievance and dispute resolution in relation to matters arising under the Agreement. The dispute resolution procedure provides that if the dispute remains unresolved after conciliation, the Fair Work Commission (the Commission) may arbitrate the dispute.

[8] There was no dispute between the parties that there was jurisdiction to resolve this matter.

[9] The Agreement at clause 22 sets out the call back arrangements as follows:

“Call Back

(a) An employee recalled to work overtime after finishing the normal day’s work, whether notified before or after leaving the workplace, is to be paid overtime, at the relevant rate, as follows:

(i) for the first recall a minimum payment of four hours; and

(ii) for any subsequent recall a minimum payment of three hours.

(b) Time reasonably spent in getting to and from work is to be regarded as time worked.

(c) Employees recalled to work within two hours of their normal starting time shall be paid at overtime rates with a minimum payment of two hours at double time.”

Evidence and submissions of the ANF and HSU

[10] Ms Jenny Thomas, an industrial officer with the ANF, gave evidence on behalf of the ANF. 2 It was her evidence that the clause under consideration in this dispute derives from the two predecessor agreements, namely the Presbyterian Care Tasmania Inc Incorporated Presbyterian Homes Hobart Nurses Agreement 2008 (the Hobart Agreement) and the Launceston Presbyterian Homes for the Aged Inc Nurses Agreement 2008 (the Launceston PCT Agreement).3

[11] It was Ms Thomas’ evidence that the ANF file disclosed that in negotiating the Launceston PCT Agreement, the parties intended negotiating a collective agreement for nurses which was an amalgamation of the existing nurses award, at the time the Nurses (Tasmanian Private Sector) Award 2005 (the 2005 Award) and the Tasmanian Aged Care Nursing Enterprise Agreement 2004 (the 2004 Aged Care Agreement). 4

[12] A discussion draft, presented by the Respondent dated 31 October 2007, included a call back provision in identical terms to that included in the Agreement. 5

[13] The 2005 Award provided for call back as follows:

“22.1.1 Except where otherwise specifically provided an employee recalled to work overtime after leaving his/her employer’s premises (whether notified before or after leaving such premises) shall be paid at the appropriate overtime rate applicable to his/her salary:

22.1.1(a) for the first recall a minimum payment of four hours work; and

22.1.1(b) for each subsequent recall a minimum payment of three hours work.”

[14] The 31 October 2007 draft had the words “is to be paid overtime, at the relevant rate” in contrast to the provision of the 2005 Award. Further the word work did not appear after four hours in the draft agreement. The ANF was not able to find evidence to explain why the changes were made. 6

[15] It was Ms Thomas’ evidence however that a letter sent to the ANF by the Respondent, dated 10 October 2007, made it clear that it was not the Respondent’s intention “to reduce back the conditions that exist in the current agreement or enterprise agreement frameworks as we recognise the significant contribution that nurses play in delivering professional care to our elders who reside in a residential aged care facilities and community care services”. 7

[16] The Launceston PCT Agreement was approved by the Workplace Authority on 23 February 2009. The PCT Hobart Agreement was negotiated at the same time and the call back clause was in identical terms. 8

[17] The call back provisions have remained unchanged in the Agreement.

[18] Ms Rachel Smith gave evidence that she is required to perform callouts as part of her duties. She was initially paid in the manner described by the Respondent but after she received a higher payment she made inquiries of the Respondent and sought advice from the ANF. 9

[19] The ANF submitted that the clause makes it clear that employees are to be paid overtime at the relevant rate.

[20] The ANF submitted that the statutory declaration, filed by the Respondent at the time the application for approval of the Agreement was made, makes the intention of the parties clear. 10

[21] In the statutory declaration sworn by Mr Andrew Flood on 25 October 2011, Mr Flood deposed that certain provisions of the Agreement were more beneficial than the Nurses Award 2010, in particular he referred to clause 22 as follows:

Clause 22 First recall - a minimum of four hours at overtime rates Clause 28 - Nurses Award Recall will be paid a minimum of three hours at overtime rates All employees

[22] The ANF submitted that it filed a statutory declaration with the Commission endorsing Mr Flood’s statutory declaration.

[23] The HSU supported the ANF’s interpretation of the clause and said further that if the interpretation put forward by the Respondent is correct then the word “overtime” in the phrase “is to be paid overtime” is redundant. It is submitted that the word “overtime” must have a purpose, and it is used to make it clear that employees are paid at the overtime rate of pay. 11

[24] The HSU also relied upon the statutory declaration signed by Mr Flood. It submitted that the Respondent was required by the Act to set out, in a statutory declaration, the provisions of the Agreement which were more beneficial than the relevant modern award and those that were less beneficial than the relevant modern award. In this case, where the modern award provides that an employee recalled to work is paid a minimum of three hours at overtime rates, the employer was obliged to advise the Commission that the Agreement provision was less beneficial.  12

[25] The HSU submitted that had Mr Flood, in the statutory declaration, disclosed the Respondent’s interpretation of this clause there would have been submissions made to the Commission in relation to the Better Off Overall Test. 13

[26] The HSU also said that support for its construction of the Agreement can be found in the provisions of the Agreement that apply to close call.

[27] Clause 22(d)-(f) of the Agreement provides for close call as follows:

“(d) For the purposes of this clause close call means an employee being required to be on call for duty and not allowed to leave the workplace.

(e) An employee may be required by the employer to remain on close call.

(f) An employee required to remain on close call shall:

(i) if not required to commence work be paid a minimum payment equivalent to 6 hours at the employees relevant rate; or

(ii) if required to commence work be paid at the relevant overtime rate, provided that such payment shall not be less than the minimum payment specified in (a) above.”

[28] The HSU submitted that if the construction proposed by the Respondent is correct an employee who is on close call but was not required to work would be paid six hours pay while the employee required to work for one hour would get paid four hours pay. It is this anomaly that the HSU submitted shows that the Respondent’s construction of the Agreement cannot be supported. 14

The Respondent’s evidence and submissions

[29] Ms Lara Alexander, the General Manager of the Respondent, gave evidence that she was involved in the negotiations for the Agreement. It was her evidence that she could not recall any discussions or negotiations in respect of the call back provision. 15

[30] Ms Anita Fahey, the Manager of Community Care Services division of the Respondent, gave evidence that she had discussions with Ms McKibben, who was employed to provide case management and clinical support to clients about the appropriate rate of pay for employees called out. She was clear that employees are paid at the appropriate overtime rate but receive a minimum of four hours pay. 16 It was her evidence that when Ms Smith was employed this was explained to her.17

[31] It was her evidence that the call out work in Launceston had been performed by contractors and it was not until sometime in 2009 when the Hobart service got its first clients that direct employees performed call out work. 18

[32] Mr Andrew Flood, the Director of Human Resources for the Respondent gave evidence that he was involved in the negotiations for the Agreement. He cannot recall any discussions or negotiations about the call back provision. 19

[33] Mr Flood gave evidence that he drafted the employer’s declaration in support of the application for approval of the Agreement and he sent a copy of that draft to the ANF and HSU. It was his evidence that he only provided brief information in his draft on the more beneficial and less beneficial provisions of the Agreement and he did not include any reference to the call back provisions. It was his evidence that Mr Eddington, the HSU’s legal officer, sent him an email which contained a table which was more detailed in relation to the more beneficial and less beneficial provisions which Mr Flood incorporated into the employer’s declaration. 20 Mr Flood gave evidence that the description of clause 22 in his statutory declaration was wrong.

[34] The Respondent submitted that the words of the Agreement are clear and unambiguous. 21 The Respondent submitted that the employees are paid at overtime rates and there is no dispute about this. However the Respondent submitted that the Agreement guarantees employees a minimum payment of four hours pay or three hours pay.

[35] The Respondent says the words in the Agreement are clearly different to those in the Nurses (Tasmanian Private Sector) Award 2005 (the 2005 Award) and the Nurses Award 2010 and therefore the ANF cannot rely upon those award provisions to support their interpretation of the Agreement. 22

[36] The Respondent submitted that the statutory declaration signed by Mr Flood does not show any intention of the Respondent nor should it be used to interpret the Agreement. 23

[37] The Respondent submitted the submissions of the ANF that their endorsement of the statutory declaration indicates the mutual intention of the parties should be rejected because the person who signed the ANF’s F18 form was not a party to the negotiations, and there is no evidence or witness statement from the signatory before the Commission which states that he or she is in agreement with the employer’s F17. 24

[38] The Respondent submitted that what the Commission is required to determine is the mutual intention of the parties and not one of the party’s particular intentions. 25²⁶

[39] The Respondent submitted that the Nursing Homes Award Tasmania contained a similar provision to that found in the Agreement.

[40] It provided for call backs as follows:

“13. Call back

(a) Except where otherwise specifically provided an employee recalled to work after leaving his/her employer’s workplace (whether notified before or after leaving such workplace) shall be paid at the overtime rate in accordance with Clause 29 – Overtime.

(b) Where an employee is recalled to work in accordance with subclause (a) hereof and the payment at overtime rates in accordance with Clause 29 – Overtime does not equal or exceed four hours pay, then the employee shall be paid four hours pay.

.................................

[41] The Respondent submitted that this supports a finding that, in Tasmania, payment for call backs had previously been in accordance with what is provided for in the Agreement.

[42] Further the Respondent submitted that the Employer General Staff Agreement 2009 27 which applies to the non-nursing staff of the Respondent provides for call back at clause 35 as follows:

“Call back

(a) Except where otherwise specifically provided an employee recalled work after leaving their workplace (whether notified before after leaving the workplace) will be paid at the appropriate overtime rate in accordance with the Overtime Clause in this Agreement.

(b) Where an employee is recalled to work and payment at overtime rates described in subclause (a) above, does not equal or exceed four hours pay, the employee will be paid four hours pay.”

[43] The Respondent submitted that the HSU, which is a party to this agreement, accepts this provision for non-nursing staff. 28

[44] It was submitted that the ANF has subsequently entered into other agreements with the same provisions as appear in the Agreement, knowing that there is a dispute about the application of the clause.

[45] Further it was submitted that the ANF has entered into at least one other agreement which makes it clear that recall is paid at overtime rates. The Healthscope Ltd Tasmanian Nurses Enterprise Agreement 2011 clearly provides that the minimum payment is four hours and is paid at overtime rates. 29

[46] At the hearing, I drew the parties’ attention to the decision of Vice President Lawler in Hospira Australia Pty Ltd v National Union of Workers 30in which he considered a dispute about whether an agreement provided for the accrual of rostered days off during annual leave and personal leave. Vice President Lawler said that if the agreements had been greenfields agreements then the construction put forward by the company would have been adopted. However in this case Vice President Lawler held that the terms of the agreement were ambiguous and that “the objective framework of facts in which the current agreements were made is certainly admissible on the construction of those agreements.” Those facts were:

● the agreements were the latest in a series of collective agreements that had applied for many years;

● the custom and practice at the site for over 20 years had provided for such accrual;

● the current agreement replicated terms which had been included in previous agreements; and

● there was no claim for a reduction in the number of RDO’s in bargaining.

[47] Consequently he held that RDO’s accrue during annual leave and personal leave.

[48] I provided the parties with an opportunity to make further submissions. The ANF submitted that the decision was not relevant to the matter before the Commission as there had not been a long term custom and practice at this workplace and it was not possible to conclude “that the common intention of the parties is reflected in a practice adopted by the employer.” 31

[49] The Respondent submitted that the decision was on point as the provision had been in place for some time, the wording was similar to the wording in the Nursing Homes Award and it was the custom and practice at this workplace to pay a minimum four hour payment. It was the Respondent’s submission that this practice had spanned the two agreements and therefore it should be taken that the parties intended the clause to continue to apply as it had been applied. 32

Principles of construction

[50] Vice President Lawler set out detail in Watson v ACT Department of Disability Housing and Community Services the legal principles to be adopted when construing awards and agreements. 33 A Full Bench in The Australian Workers’ Union - West Australia Branch v Co-operative Bulk Handling Limited34 cited Vice President Lawler with approval and made reference to the decision of Logan J in Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v QR Limited.35 Logan J said:

“The starting point must always be the language employed by the parties to an industrial agreement but industrial context and purpose are always relevant when construing that language.”

[51] The Full Bench concluded that:

“...the extract from Watson and the approach of Logan J, inform the manner in which we approach the test of construing the agreement and leads to the conclusion that regard must be had to extrinsic material in order that the meaning of the clause in question may be properly understood.”

[52] I adopt the approach endorsed by the Full Bench.

Conclusion

[53] The ANF and HSU relied on four indicia to support their contention that employees are entitled to be paid a minimum of four or three hours at overtime rates when called back to perform work.

1. The words of the clause itself.

2. The statement of the Respondent when negotiating the predecessor agreement that there was no intention to reduce conditions.

3. The statutory declaration of Mr Flood filed with the Commission with the application to approve the Agreement which stated that the clause was more beneficial than the provision in the Nurses Award 2010.

4. The construction of the clause put by the Respondent would mean that an employee on close call who was not required to perform work would get paid more than an employee on close call who was required to perform work.

[54] The Respondent relied upon three indicia to support their contention that while the employees are paid overtime they are entitled to at least four or three hours pay at ordinary rates.

1. The words of the clause itself;

2. The difference in the words when compared with the predecessor awards and other agreements negotiated by the ANF and HSU; and

3. The provision and the method of payment were unchallenged in the predecessor agreement and are unchanged in the Agreement.

[55] I find that the words of clause 22 the Agreement are ambiguous and uncertain.

[56] While I would not have found that any of the individual indicia relied upon by the ANF and HSU by themselves to be decisive, when considered together, they support the conclusion that the clause was intended to provide nurses, who were called back to work, a minimum payment of four or three hours at overtime rates.

[57] If, as the Respondent submitted, it was the intention of the parties to reduce the payment for call backs when making the predecessor agreements I would have expected there to be evidence of the claim by the employer and the negotiations around the claims. Ms Thomas was not cross examined on her evidence that the Respondent advised the ANF, when negotiating the predecessor agreement, that it was not its intention to reduce conditions. This evidence was not challenged in submissions.

[58] The Respondent contends that the reference to clause 22 in Mr Flood’s statutory declaration was included by mistake and was not in Mr Flood’s first draft. That draft however was not provided to the Commission. Further, even if that is correct, it does not explain why clause 22 was not included as a less beneficial provision. In supporting the approval of the Agreement the ANF and HSU were entitled to rely on a statutory declaration signed by Mr Flood.

[59] However what tips the balance in this matter is the interrelationship between clause 22(a) and 22(f). I accept the submissions that an interpretation that leads to an absurd result should be avoided if an alternative interpretation, consistent with the language of the clause, is available.

[60] I do not accept that that the parties intended that an employee on close call who was not required to work would be paid more than an employee on close call who was required to work. Therefore the only interpretation possible is that clause 22(a) required the employee to be paid a minimum of four hours or three hours at overtime rates.

[61] While I accept that different language is used in the 2005 Award, as I have indicated above, there is no evidence before me that would support a finding that it was the intention of the parties when making the predecessor agreement to reduce conditions.

[62] I also accept that the Nursing Homes Award has a different entitlement to the Agreement but that award does not apply to nurses and it not relevant to this matter. In any event, it is not unusual for there to be different conditions applying to nurses and non nursing staff working for the same employer. So much is evident from the Employer General Staff Agreement 2009. If the Respondent had sought to have the same call back provision apply to nursing staff as applied to non nursing staff then it could have proposed the wording used in clause 35 of the non nursing staff agreement in place of the words used in clause 22 of the Agreement. Those words are unambiguous.

[63] Further it is not relevant that the same union parties have negotiated the same or different clauses in other agreements.

[64] I accept that the same words were used in the predecessor agreement and the employees did not challenge the Respondent’s interpretation during the life of that agreement. However it cannot be said the ANF and HSU were aware of the Respondent’s practice and therefore I do not consider that the approach of Vice President Lawler in Hospiria should be followed in this case.

Remedy

[65] The ANF sought the following determinations:

1. The Respondent pay recall as required under clause 22 of the Agreement.

2. Back pay of any recall that has not been paid as required under clause 22 of the Agreement.

3. Back pay of any recall remuneration that was payable under the relevant clause of the pre-seeding agreements which cover nursing staff employed by the respondent.

[66] At the hearing the ANF submitted that “some of the relief sought there is problematic and I think really for the purposes of today’s application I would have to ask that a determination be made only in relation to the ongoing application of the agreement and the relevant clause so that it properly falls within the Commission’s dispute settling procedures about matters arising under the agreement”. 36

[67] While Ms Duffy indicated that I could say that the employer shall back pay the employees the appropriate amount of money, she submitted that to actually order the back pay would be problematic. 37

[68] The Respondent did not address these submissions.

[69] The High Court in CFMEU v AIRC 38 said in relation to the private arbitration power of the Commission:

“30. There is, however, a significant difference between agreed and arbitrated dispute settlement procedures. As already indicated, the Commission cannot, by arbitrated award, require the parties to submit to binding procedures for the determination of legal rights and liabilities under an award because Ch III of the Constitution commits power to make determinations of that kind exclusively to the courts. However, different considerations apply if the parties have agreed to submit disputes as to their legal rights and liabilities for resolution by a particular person or body and to accept the decision of that person as binding on them.

31. Where parties agree to submit their differences for decision by a third party, the decision maker does not exercise judicial power, but a power of private arbitration. Of its nature, judicial power is a power that is exercised independently of the consent of the person against whom the proceedings are brought and results in a judgment or order that is binding of its own force. In the case of private arbitration, however, the arbitrator's powers depend on the agreement of the parties, usually embodied in a contract, and the arbitrator's award is not binding of its own force. Rather, its effect, if any, depends on the law which operates with respect to it.

32. To the extent that s 170MH of the IR Act operates in conjunction with an agreed dispute resolution procedure to authorise the Commission to make decisions as to the legal rights and liabilities of the parties to the Agreement, it merely authorises the Commission to exercise a power of private arbitration. And procedures for the resolution of disputes over the application of an agreement made by parties to an industrial situation to prevent that situation from developing into an industrial dispute are clearly procedures for maintaining that agreement. Parliament may legislate to authorise the Commission to participate in procedures of that kind. Accordingly, s 170MH of the IR Act is valid.

…

34. The parties to an industrial situation are free to agree between themselves as to the terms on which they will conduct their affairs. Their agreement has effect according to the general law. If their agreement is certified, it also has effect as an award. To the extent that an agreement provides in a manner that exceeds what is permitted either by the Constitution or by the legislation which gives the agreement effect as an award, it cannot operate with that effect. But the underlying agreement remains and the validity of that agreement depends on the general law, not the legislative provisions which give it effect as an award.” (emphasis added)

[70] I consider the reasoning of the High Court, albeit in relation to a different statutory regime, relevant to dispute resolution procedures in agreements approved under the Act.

[71] The ANF seeks a remedy in relation to the predecessor agreement. As there is no dispute in relation to the predecessor agreement currently before the Commission this decision does not deal with any dispute arising under the predecessor agreement.

[72] The parties did not make any detailed submissions about the remedies sought in this matter.

[73] Given the submissions of the ANF it is not necessary to explore the breadth of remedies that may be available to resolve this dispute.

[74] Therefore I will limit the remedy to a declaration that clause 22 of the Agreement provides that the minimum payment made to employees who are called back to perform work is four hours at the relevant overtime rates for the first call back and three hours at relevant overtime rates for the second call back.

[75]
In the event that this declaration does not resolve the dispute before me, I will provide the parties with liberty to apply in relation to any further orders.

DEPUTY PRESIDENT

Appearances:

A Duffy for the Australian Nursing Federation

J Eddington for the Health Services Union

A Cameron for the Presbyterian Care Tasmania

Hearing details:

2013.

Hobart:

30 May.

 1   AE889439

 2   Exhibit ANF 1

 3   Ibid at [5]

 4   Ibid at [6]-[9]

 5   Ibid at [10]

 6   Ibid at [12]

 7   Ibid

 8   Ibid at [13]-[14]

 9   Exhibit ANF 2

 10   Exhibit ANF 3 at [19]

 11   Exhibit HSU 1 at [1]

 12   Ibid at [2]

 13   Ibid

 14   Ibid at [3]

 15   Exhibit R 2 at [4]

 16   Exhibit R 1 at [7]

 17   Ibid at [13]

 18   Ibid at [4]

 19   Exhibit R3 at [2]-[5]

 20   Ibid at [8]

 21   Exhibit R4 at [10]

 22   Ibid at [20]

 23   Ibid at [23]

 24   Ibid at [24]

 25   Ibid at [25]

26 Ibid at [32]-[33]

 27   [2010] FWAA 2125

 28   Ibid at [36]

 29   Ibid at [38]-[39]

 30   [2010] FWA 1199

 31   Email from the ANF dated 6 June 2013.

 32   Email from the Respondent dated 6 June 2013.

 33   [2008] AIRC 29 at [7]-[15]

 34   [2010] FWAFB 4801

 35 [2010] FCA 591 at [39]

 36   Transcript PN 268

 37   Ibid PN 271-272

 38 203 CLR 645 at [30]-[34]

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