Australian Rail, Tram and Bus Industry Union v Laing O'Rourke Australia Construction Pty Ltd

[2018] FWC 5596

[2018] FWC 5596 [Note: An appeal pursuant to s.604 (C2018/5372) was lodged against this decision.]

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.739—Dispute resolution

Australian Rail, Tram and Bus Industry Union

v

Laing O’Rourke Australia Construction Pty Ltd

(C2017/6629)

DEPUTY PRESIDENT DEAN SYDNEY, 5 SEPTEMBER 2018

Application to deal with a dispute.

1. On 30 November 2017 the Australian Rail, Tram and Bus Industry Union (RTBU) filed an application pursuant to s.739 of the Fair Work Act 2009 for the Fair Work Commission to deal with a dispute with Laing O’Rourke Australia Construction Pty Ltd (LORAC).

1. The application was made in accordance with clause 7 (Industrial Relations Disputes Procedure) of the Laing O’Rourke Australia Construction Pty Ltd Rail Infrastructure - Rail Track & Associated Works Enterprise Agreement 2016-2019 (the Agreement).

1. The Agreement covers LORAC, the RTBU, the Australian Workers’ Union, the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia; and employees of LORAC engaged in performing various work on rail infrastructure within the state of New South Wales.

1. The matter in dispute relates to payment of a Productivity/Site Allowance (the Allowance) which is prescribed at clause 4.1 of Appendix C to the Agreement:

4Productivity/Site Allowance Payment

4.1A Productivity/Site Allowance will be paid only for an awarded contract package with a build cost, as defined below in Table 1. The relevant Productivity/Site Allowances: shall be payable from the commencement of the first full pay period after the Agreement is approved by the Fair Work Commission.

The ‘Productivity Incentive Payment’ as shown in Table 1 shall be paid to Employees for each hour worked on the project, as flat rate attracting no premium or penalty. Such an Allowance is in recognition of improved productivity performance arising from the successful operation of this Agreement and meeting a project’s milestones. This payment will also be in lieu of and any other Special Rates or allowances included in any award other than those provided for in this Agreement and in lieu of any site or project allowance other than a site or project allowance prescribed in a specific project Agreement or project award (which is contractually applicable and/or formally approved under the relevant Government Building Codes and guidelines (as amended) and certified by the relevant industrial tribunal) where the higher shall be paid.

Project Incentive Productivity Allowance payments will not be made when an Employee(s) fail to comply with the prescribed procedures within this Agreement for ‘Inclement Weather’, the ‘Safety Dispute Procedures’ and the ‘Industrial Relations Dispute Procedures’ of this Agreement.

Table 1

Awarded Contract Package Build Cost Value – County of Cumberland, Northumberland or Camden	Allowance $Amount Per Hour Worked
$30M - <$400M	$3.54
Greater $400M	$4.05
Awarded Contract Package Build Cost Value – Outside the County of Cumberland, Northumberland or Camden	Allowance $Amount Per Hour Worked
$30M - <$400M	$3.04
Greater $400M	$3.54

1. The clause refers to the Allowance variously as the ‘Productivity/Site Allowance’, the ‘Productivity Incentive Payment’, and the ‘Project Incentive Productivity Allowance’. I note there was no suggestion by either party that this raised any issue of ambiguity, and both parties seemed to accept that the various references were a reference to the same allowance.

Background

1. In 2015 LORAC was successful in its tender for work on the Main North and North Shore Corridor Works (MNNSC Works) as part of the Sydney Metro Northwest Project administered by Transport for NSW (TfNSW).

1. The Managing Contractor Contract (the Contract) made between TfNSW and LORAC divided the scope of the work performed into Portions 1 to 6. Portions 5 and 6 were options which were both later exercised by TfNSW.

1. In August 2017, a Deed of Variation was made between TfNSW and LORAC to include a new Portion 7A to the Contract.

1. It is not in dispute that the total ‘build cost’ for Portions 1 to 6 was below $30 million. The contention arises as to whether the build cost of Portion 7A is added to the ‘awarded contract package’ referred to in clause 4.1, resulting in the build cost reaching $30 million or more and thereby making the Allowance payable.

1. The dispute was the subject of conciliation before me on 7 December 2017 and 13 February 2018 and remained unresolved. Prior to the matter being listed for hearing to determine the dispute, there have been various proceedings to deal with matters including the production of documents and an application for a confidentiality order.

1. The application was heard on 15 May 2018, with Ms I Szumer appearing on behalf of the RTBU, and Mr P Ludeke appearing, with permission, for LORAC.

Issue to be determined

1. The parties agreed that the dispute can be determined by answering the following questions:

1. In relation to the ‘Main North and North Shore Corridor Works’, is Laing O’Rourke Construction Australia Pty Ltd required to pay a Productivity/Site Allowance Payment pursuant to clause 4.1 of Appendix C;

2. If yes, to/for which employees, and from what date, must those payments be made?

1. The RTBU contends that the first question should be answered in the affirmative, and the second question should be answered “to each Laing O’Rourke employee for each hour worked on any portion of the Main North and North Shore Corridor Works since commencement”.

1. LORAC contend that the answer to the first question is no, and the second question is therefore not applicable.

1. The resolution of the dispute turns upon the interpretation of particular provisions in the Agreement. In reaching my conclusion, I have had regard to the principles applicable to the construction of an enterprise agreement which were canvassed in detail in Australasian Meat Industry Employees Union v Golden Cockerel Pty Ltd[1] (Golden Cockerel) and Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v Berri Limited[2] (Berri).

1. For the reasons set out below, I have found that the answer to the first question is no, LORAC is not required to pay the Allowance pursuant to clause 4.1 of Appendix C in relation to the ‘Main North and North Shore Corridor Works’. Question two is not therefore relevant.

The RTBU’s evidence and submissions

1. Witness statements were filed on behalf of RTBU by:

·  Mr J Moran (Grade 2 Signalling Leading Hand)[3];

·  Mr L Curley (Civil Track Leading Hand)[4]; and

·  Ms I Szumer (RTBU Industrial Officer)[5].

1. None of the RTBU witnesses was required for cross-examination.

1. The evidence of Mr Moran and Mr Curley went primarily to the matters set out in paragraph 27 below, which were described as the key factors that establish there was only one single project in this case, inclusive of all portions.

1. Ms Szumer’s evidence annexed the contract between LORAC and TfNSW and the Deed of Variation.

1. In closing submissions, the RTBU said that to find the RTBU’s case made out, I must “first accept that the correct interpretation of awarded contract package encompasses contracts and their variations that both award work on the same project and second, therefore, [I] must find as a matter of fact in this case that the deed of variation for portion 7A did award work on the same project as portions 1 to 6 of the Main North and North Shore corridor works….”[6]

1. In its written submissions, the RTBU relied on the principles governing the interpretation of enterprise agreements summarised in Berri. It submitted that the construction of an enterprise agreement begins with a consideration of the ordinary meaning of the words, having regard to their context and purpose. It also referred to the observation of Madgwick J in Kucks v CSR Limited[7] that a narrow or pedantic approach to interpretation should be avoided.

1. The RTBU submitted that it was critical that construction of industrial instruments should contribute to a sensible industrial outcome; the words of the agreement must not be interpreted in a vacuum divorced from industrial realities. It referred to the decision in Geo. A. Bond & Co. Ltd (in liq.) v McKenzie where Street J said:

“… It must be remembered that awards are made for the various industries in the light of the customs and working conditions of each industry, and they frequently result … from an agreement between the parties, couched in terms intelligible to themselves but often framed without that careful attention to form and draughtsmanship which one expects to find in an Act of Parliament. I think, therefore in construing an award, one must always be careful to avoid a too literal adherence to the strict technical meaning of words, and must view the matter broadly, and after giving consideration and weight to every part of the award, endeavour to give it a meaning consistent with the general intention of the parties to be gathered from the whole award.”

1. The RTBU asserted that the proper construction of clause 4.1 of Appendix C is as follows:

a.   Where an awarded contract package has a build cost of $30 million or more, the Allowance becomes payable.

b.   The relevant ‘project’ and ‘site’, which need to be determined first for the purposes of clause 4.1, will delimit the boundaries of the ‘awarded contract package’ and hence ultimately determine payment of the Allowance. The ‘project’ and ‘site’ are questions of fact turning on the circumstances of each case.

c.   The ‘awarded contract package’ for the purpose of clause 4.1 includes any contract granting to LORAC work forming part of the project on the project site.

d.   The Allowance becomes payable if the build cost for the ‘awarded contract package’ at any point equals or exceeds $30 million over the course of the project’s lifetime.

1. The RTBU submitted that the plain purpose of clause 4.1 of Appendix C is to recognise “improved productivity performance arising from the successful operation of this Agreement and meeting a project’s milestones.” This stated purpose and its focus on the ‘project’ is complemented by repeated reference to the ‘project’ throughout the clause. It pointed out that the Allowance, being variously referred to in the clause, is to be made “to employees for each hour worked on the project”. It argued that this emphasis on the ‘project’, and the very title of ‘Site Allowance’, makes it clear that the real import of clause 4.1 is to provide for an allowance in recognition of productive work performed “on a project, at the site”. It contended that the Allowance is paid in reference to a project at the site and it follows that the ‘project’ and the ‘site’ are the primary facts that must be determined in applying clause 4.1.

1. ‘Project’ is defined at clause 1.2 of the Agreement as ‘a package of works awarded to Laing O’ Rourke’. ‘Site’ is not defined in the Agreement and the RTBU submitted that the term should be understood in its ordinary English meaning and should refer to the project site in this case.

1. The RTBU submitted that the important determinants for the purpose of clause 4.1 in the present case are the MNNSC Works project including all portions and the Main North and North Shore rail corridors, being the ‘project’ and the ‘project site’ respectively. The MNNSC Works project is named after the site on which the work occurs and although the work undertaken as part of the project has been divided into portions of work, they all form one package of works and it is therefore one project on one project site. The RTBU submitted that such proposition is supported by the following factors:

1.the MNNSC Works was described in NSW Government’s tender invitation as one ‘project’ made up of various work and both the Contract and the Deed of Variation describe the work LORAC is to provide as the ‘Main North and North Shore Corridor Works Project’;

2.the portions of work share the same aims of enabling the future construction of the Sydney Metro rail line and enabling an increased capacity of the North Shore Line to twenty trains per hour;

3.all portions require work across the Main North and North Shore rail corridors. Employees are directed to work by reference to track maps of these rail corridors and not by reference to individual portion areas;

4.the physical areas covered by the various portions overlap and in some cases the work on different portions is sequential work on precisely the same cabling and signals;

5.employees are booked permanently for the MNNSC Works project across multiple portions on a day-to-day and week-to-week basis;

6.employees use the same ‘integrated, project-specific sign-on/sign-off system’ for work performed on any portion of the project: until early 2018, there was one primary site office for all portions of the MNNSC Works. Although there are now additional site offices labelled as portion-specific, such as a ‘portion 7 site office’, all employees working across portions 1-7A attend the same pre-start briefing every morning at the Artarmon site office;

7.a singular project-specific induction session is conducted in respect of all portions of the project where employees are briefed to comply with the same set of procedures relating to work hours, safety, environmental issues and emergencies in relation to all portions. Employees who had previously attended induction sessions in respect of portions 1-6 were not required to attend additional induction sessions after portion 7A was added. Employees commencing work on portion 7A were only required to attend an induction covering portions 1-6;

8.employees working across all portions of MNNSC Works attend the same ‘project toolbox meetings’ run by LORAC project management every week where employees are debriefed on the status and progress of all portions;

9.Portions 7A became part of the MNNSC Works after a request was made by TfNSW under the Contract for LORAC to provide a quotation for a proposed variation to the work. The Contract was subsequently amended by the Deed of Variation to incorporate portion 7A. There is therefore one agreement, being the Contract as amended by the Deed of Variation, which governs all portions of work.

1. The RTBU argued that: “the wording and industrial context of clause 4.1 buttress the logical interpretation of ‘awarded contract package’ not as abstract legal documentation but rather as the contract package awarded for a project and providing for work to take place at the project site.” It submitted that this interpretation is consistent with the plain language and intention of the clause. In this regard, the RTBU argued that: “[i]t cannot be the intention of the clause that payment of a Site Allowance for time worked on a project is contingent on the form that the project’s contractual documentation takes and whether the project client elects to award the project’s contractual documentation takes and whether the project client elects to award the project work to LORAC in one or multiple contracts. Further, the possibility that multiple contracts may be involved is encompassed within the very language of ‘package’.”

1. The RTBU claimed that the Deed of Variation was a variation contemplated by the original contract itself and was implemented by way of an amendment to the Contract. The Contract is therefore a single contract covering all of portions 1 to 7A, as amended by the Deed of Variation, and constituted the ‘awarded contract package’ for the purpose of clause 4.1 of Appendix C.

1. The RTBU submitted that the fact that the terms of the Contract for the MNNSC Works expressly provide for a variation to the scope of work to be performed reflects that the size and value of a project can change as the project progresses. It said: “An interpretation of clause 4.1 that is not narrow or pedantic and that produces a sensible industrial outcome must therefore recognise that like the project, the awarded contract package is not static from the project’s commencement. Contracts awarded may be varied and additional contracts may be executed as the scope of the project changes, and hence the content of the awarded contract package for clause 4.1 may change. The substance of the awarded contract package – being contracts providing for work on the project – ought to take precedence over the form the package takes. Any alternative interpretation would effect an injustice, allowing clause 4.1 to be circumvented by dividing one project into multiple small projects.”

1. The RTBU further submitted that the scope of the MNNSC Works project increased when the options for portions 5 and 6 were exercised and when the Deed of Variation for portion 7A was executed. It says that LORAC would not have been given more work under the project unless it was meeting project milestones and performing to a satisfactory standard. It submitted that the plain intention of the clause is to recognise the work of employees in achieving this outcome and that the boundaries of the awarded contract package must be ascertained with this intention in mind.

1. In conclusion, the RTBU submitted that the build cost of the awarded contract package for the MNNSC Works project was above the $30 million threshold ($37.943 million) when portion 7A was incorporated into the project by way of deed on 24 August 2017. This triggered clause 4.1 and the Allowance became payable to employees for each hour worked on any and all of portions 1 to 7A for all work performed since the project’s commencement. Such outcome is supported by the intention of the clause which is to “reward employees who have contributed to improved productivity performance and the meeting of a project’s milestones”.

1. In the alternative, it argued, employees must be paid for each hour worked on the project at least from the time the awarded contract package build cost reached the $30 million threshold, being the date when portion 7A was added to the project on 24 August 2017.

1. In its submissions in reply, the RTBU argued that LORAC had conflated a variation to the original contract with a variation to an awarded contract package, and hence misconstrued the key interpretation question to be decided. The RTBU contended that the variation operated to vary the Contract, and therefore the awarded contract package included portion 7A. The RTBU also contended that the word ‘only’ was directed towards payment of the Allowance, and made further submissions in relation to the meaning and relevance of the word ‘project’.

LORAC’s evidence and submissions

1. Mr L Taylor, Project Director of LORAC provided a statement[8] and gave oral evidence.

1. Mr Taylor gave evidence that portion 7A was not part of the original awarded contract which dealt with portions 1-6. He said that a later variation to an awarded contract package was a separate and distinct agreement with their client.

1. In its submissions, LORAC contended that the ‘awarded contract package’ for the purposes of clause 4.1 of Schedule C was made up of Portions 1 to 6 of the MNNSC Works, with a total build cost of 24.33 million.

1. LORAC argued that on the basis of the rules of interpretation of enterprise agreements, the Deed of Variation for Portion 7A cannot be part of the ‘awarded contract package’ because no reference is made in the Agreement to variations of the ‘awarded contract package’.

1. The RTBU’s claim that a ‘variation’ to an ‘awarded contract package’ equivalents an ‘awarded contract package’ is in defiance of the logical distinction between the two terms.

1. The Oxford English Dictionary defines ‘variation’ as “the fact of varying in condition, character, degree, or other quality; the fact of undergoing modification or alteration, especially within certain limits. The action of making some change or alteration”. LORAC contended that the definition plainly demonstrates the distinction between the form of the original ‘awarded contract package’ and the later action to change, alter or modify that original ‘awarded contract package’ by way of formal variation.

1. The proper interpretation of clause 4.1 does not depend on a determination of what is the ‘project’. The operative provisions of clause 4.1 are that the Allowance is “paid only for an awarded contract package with a build cost as defined below in Table 1” of $30 million or more, and not for a ‘project’ valued at $30 million or more.

1. Table 1 under clause 4.1, insofar as it can be said to define ‘build cost’, requires payment of the Allowance for an ‘Awarded Contract Package Build Cost Value’ in the named counties of $30 million or more, without reference to the ‘project’ to which the awarded contract package relates.

1. Further, those operative provisions take effect in their own right if the build cost value of the ‘awarded contract package” is $30 million or more, regardless of what the ‘project’ is that the employees work on.

1. It was submitted that had the allowance been payable according to the value of a ‘project’ rather than the build cost value within the ‘awarded contract package’ of works, or projects, or parts of works, or parts of projects, it would have been drafted to state so in simple terms. It refers to the use of a “far more particularly-framed set of words directed precisely to the contractually awarded package and the build cost figure within that contract.”

1. LORAC drew a distinction between the TfNSW’s project and LORAC’s project: LORAC is contracted on parts of what the Managing Contractor Contract describes as TfNSW’s “Main North and North Shore Corridor Works Project” while the Deed of Variation describes TfNSW’s project as the “Sydney Metro Northwest Project” within which are the Main North and North Shore Corridor Works. LORAC said that although it performs both the Managing Contractor Contract and the Deed of Variation, it does not construct all of TfNSW’s projects. In this regard, LORAC relied on Mr Taylor’s evidence that Portion 7B, 8 and 9 of TfNSW’s project are yet to be awarded.

1. LORAC submitted that the definition of ‘project’ in clause 1.2 of the Agreement as “a package of works awarded to Laing O’Rourke” is consistent with the words ‘package’ and ‘awarded’ used in clause 4.1. It argues that neither clause 1.2 nor clause 4.1 contemplates variation to the awarded ‘package’.

1. LORAC further submitted that “the Agreement is not drafted to have provisions that are reliant on the ‘project’ being determined by some person or body that is uninterested in the Agreement and not party to it. It is not for the bodies to which LORAC contracts to determine what is LORAC’s project for the purposes of its Agreement with its employees. Hence the definition of ‘project’ in clause 1.2 of the Agreement confines the meaning of ‘project’ to the package of works awarded to LORAC, rather than to what LORAC’s clients’ projects may be.”

1. LORAC argued that the fact that employees such as Mr Moran and Mr Curley do not work on a particular ‘project’ at all times, demonstrates that the Agreement is not a project-specific agreement and applies generally to LORAC’s railway work in NSW. It argued, therefore, the RTBU’s emphasis on what it asserts is the ‘project’ is misplaced and ignores the actual wording of the provision which triggers payment of the allowance in clause 4.1.

1. LORAC submitted that the meaning of clause 4.1 was plain on its face, and relying on Berri, noted that “the task of interpreting an agreement did 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 the parties”.[9]

1. It argued that the meaning of the clause is as follows:

a.The Allowance is paid ‘only’ for an awarded contract package with a build cost of $30 million or more. The word ‘only’ is singular and exclusive – nothing other than the build cost of the awarded contract package is taken into account.

b.The word ‘only’ must be intended to exclude later variations of the awarded contract package otherwise its use in the sentence is meaningless.

c.In reliance on Project Blue Sky Inc v Australian Broadcasting Authority[10] (Project Blue Sky), it argued that the use of the word ‘only’ must have its ordinary meaning.

d.To accept that ‘awarded contract package’ included a subsequent variation is to ignore the ordinary meaning of the word ‘only’, and would mean superimposing on clause 4.1 words that are not there.

e.An interpretation of the word ‘only’ that includes later variations requires a rewriting of the plain meaning of the clause, contrary to Berri.

f.The word ‘variation’ is not used in clause 4.1, self-evidently because a variation is not part of the ‘awarded contract package’ that the clause is ‘only’ directed to.

g.To assert, as the RTBU does, that a variation is included in the ‘awarded contract package’ because the variation is said to be part of the same ‘project’ is unsupported by the plain meaning of the words actually used in clause 4.1 and in the Agreement’s definition of ‘project’ at clause 1.2.

1. In its closing submissions, LORAC readily accepted that variations can occur. Variations can add to or take away from the build cost. Conceivably the build cost of a particular ‘awarded contract package’ could drop below $30 million as a result of a variation. LORAC contended that such a variation in these circumstances would not have the effect of removing eligibility for the Allowance because the awarded contract package was above $30 million. In contrast, if the RTBU’s interpretation was correct, it would have the effect of removing the eligibility for the Allowance if a variation reduced the awarded contract package below $30 million.

1. LORAC said that on Mr Taylor’s evidence, the awarded contract package was the Contract, that is, the Managing Contractor Contract which awarded portions 1 to 4 with an option for portions 5 and 6. This is supported by a reading of the Contract (Annexure D to Ms Szumer’s statement). A variation on the other hand is a separate and distinct agreement.

Consideration

Is there more than one arguable interpretation?

1. One of the principles of agreement interpretation set out in Berri is that “in construing an enterprise agreement it is first necessary to determine whether an agreement has a plain meaning or it is ambiguous or susceptible to more than one meaning”.[11]

1. Neither party suggested that the relevant provisions of the Agreement were ambiguous or susceptible to more than one meaning. I agree. The words are plain on their face. There is not more than one arguable interpretation.

1. The various descriptions of the Allowance were not raised as an issue by either party and I do not consider that this raises any issue of ambiguity.

Context and purpose

1. The relevant provisions of the Agreement must be construed in context. As explained by Burchett J in Short v FW Hercus Pty Ltd,[12] context extends well beyond the words of the particular provisions:

“The context of an expression may thus be much more than the words that are its immediate neighbours. Context may extend to the entire document of which it is a part, or to other documents with which there is an association. Context may also include, in some cases, ideas that gave rise to an expression in a document from which it has been taken. When the expression was transplanted, it may have brought with it some of the soil in which it once grew, retaining a special strength and colour in its new environment. There is no inherent necessity to read it as uprooted and stripped of every trace of its former significance, standing bare in alien ground. True, sometimes it does stand as if alone. But that should not be just assumed, in the case of an expression with a known source, without looking at its creation, understanding its original meaning, and then seeing how it is now used. Very frequently, perhaps most often, the immediate context is the clearest guide, but the court should not deny itself all other guidance in those cases where it can be seen that more is needed. In literature, Milton and Joyce could not be read in ignorance of the source of their language, nor should a legal document, including an award, be so read.”[13]

1. I do not agree with the RTBU’s construction of clause 4.1, in that the relevant site and the project do not need to be determined to ascertain when the Allowance is payable. What needs to be determined is the build cost for an awarded contract package. The relevant provision of the Agreement is clear, in that the first sentence of clause 4.1 provides “a Productivity/Site Allowance will be paid only for an awarded contract package with a build cost, as defined below in Table 1”.

1. The RTBU argued that the context and purpose of clause 4.1 is about projects and the work being done on projects at a site, and it would be an unduly narrow approach for the Commission to accept that despite variations being common, the awarded contract package is one single contract at one point in time. While I accept that the purpose of the Allowance is to recognise “improved productivity performance arising from the successful operation of this Agreement and meeting a project’s milestones”, the criteria that is clearly set out in the clause, and must be met before the Allowance is payable, is the awarded contract package with a build cost at or above $30 million.

1. ‘Project’ is a defined term, meaning a package of works awarded to LORAC. There is no basis upon which I should give ‘project’ a meaning other than what is provided in the Agreement.

1. I accept LORAC’s contention that operative provisions take effect in their own right if the build cost value of the awarded contract package is $30 million or more, regardless of what the ‘project’ is that the employees work on. In this regard, I accept the submissions of LORAC that the drafters of the Agreement have used a particularly-framed set of words. If the intention was to provide an allowance based on the project (whether a project of LORAC or of one of its clients) then it is reasonable to conclude that this would have been drafted to so provide.

1. In terms of the role of the Deed of Variation, the RTBU contended that to find in its favour, I must “first accept that the correct interpretation of awarded contract package encompasses contracts and their variations that both award work on the same project and second, therefore, [I] must find as a matter of fact in this case that the deed of variation for portion 7A did award work on the same project as portions 1 to 6 of the Main North and North Shore corridor works ...”

1. LORAC does not dispute that the Contract was varied by the Deed of Variation. Mr Taylor’s evidence, which I accept, is that the Contract and the Deed of Variation are separate agreements between LORAC and it client. However the issue for determination is whether the awarded contract package had a build cost of $30 million or more, not whether the Deed of Variation varied the Contract.

1. It is clear that neither clause 4.1 nor the definition of project in clause 1.2 of the Agreement specifically contemplates a variation to the awarded contract package, and the word ‘only’ should be given some work to do.

1. I accept Mr Taylor’s evidence and find that the Contract was a package of works (ie. a Project, as defined). The variation (ie. portion 7A) was a separate package of works awarded to LORAC, and therefore a separate Project as defined in the Agreement.

1. In coming to my conclusion, I have considered the evidence of Mr Moran and Mr Curley. Their evidence does not assist in determining this dispute. This is because the interpretation of the Agreement does not turn on the makeup of LORAC’s project team, whether employees work on one or multiple projects, how site inductions are conducted, who attends toolbox meetings, or the like. These matters do not impact on the build cost for an awarded contract package.

Conclusion

1. For the above reasons and having considered relevant clauses in the context of the Agreement as a whole, I resolve the dispute in relation to the ‘Main North and North Shore Corridor Works’ by determining that, on the proper construction of the Agreement, portion 7A does not cause LORAC to be required to pay the Allowance pursuant to clause 4.1 of Appendix C.

DEPUTY PRESIDENT

Appearances:

I Szumer for the Australian Rail, Tram and Bus Industry Union.
P Ludeke for Laing O’Rourke Australia Construction Pty Ltd.

Hearing details:

2018.
Sydney:
May 15.

<PR700118>

[1] [2014] FWCFB 7447.

[2] [2017] FWCFB 3005.

[3] Dated 27 March 2018 and 24 April 2018, Exhibits 1 and 2 respectively.

[4] Exhibit 3.

[5] Exhibit 4.

[6] Transcript PN120.

[7] (1996) 66 IR 182 at 184.

[8] Exhibit 5.

[9] [2017] FWCFB 3005 at [114].

[10] (1998) 194 CLR 355.

[11] [2017] FWCFB 3005 at [114].

[12] [1993] FCA 51.

[13] Ibid at [7].

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