Australian Rail, Tram and Bus Industry Union v Metro Trains Melbourne Pty Ltd (Metro)
[2022] FWC 720
| [2022] FWC 720 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.739—Dispute resolution
Australian Rail, Tram and Bus Industry Union
v
Metro Trains Melbourne Pty Ltd (Metro)
(C2021/4589)
| DEPUTY PRESIDENT MANSINI | MELBOURNE, 31 MARCH 2022 |
Dispute about any matters arising under the enterprise agreement and the National Employment Standards in the Fair Work Act 2009 (Cth).
This decision relates to an application by the Australian Rail, Tram and Bus Industry Union (Union) under section 739 of the Fair Work Act 2009 (Cth) (Act) and the dispute resolution procedure at clause 1.11 of the Metro Trains Melbourne Pty Ltd Rail Operations Enterprise Agreement 2019[1] (Agreement).
The employer respondent is Metro Trains Melbourne Pty Ltd (Metro), operator of Melbourne’s metropolitan train network.
The dispute is essentially about the entitlement(s) to “transfer to a safe job” for pregnant employees who work in rail operations positions covered by the Agreement.
Preliminary matters
There was no agreed resolution of the dispute following a conference before the Commission and so the matter proceeded to arbitration before the Commission as presently constituted, without objection.
The Union sought to rely on 3 witness statements of a Ms Tamara Fabbro (Multi Modal Authorised Officer Employee of Metro) and a witness statement of a Ms Esther Ledua (Multi Modal Authorised Officer Employee of Metro).[2] Metro sought to rely on a witness statement of a Mr Mario Stanisic (Multi Modal Authorised Officers Manager – Passenger Experience of Metro).[3] Various outlines of submissions were filed.
The dispute resolution procedure at clause 1.11 provides for representation of an employee by the Union at all stages (clause 1.11.2). Permission to be represented by counsel at the arbitration was sought and granted to both parties pursuant to s.586 of the Act.
The Union ultimately proposed 5 questions for resolution of the dispute (at Annexure A to this decision).
Jurisdiction
There is no dispute, and I am satisfied, that the Agreement covers: Metro; all employees of Metro who work in rail operations positions as defined at clause 1.2.2 of the Agreement; and the Union as noted in the Commission’s decision to approve the Agreement (clause 1.2).
There was also no dispute, and I am satisfied that, the dispute as it relates to the questions of construction (the Union’s proposed questions 1, 4 and 5) is a dispute about a matter arising under the Agreement and/or the National Employment Standards in the Act (the NES) (clause 1.11.1(a) and/or (b)) and the pre-requisites at clause 1.11 have first been followed such that the Commission is empowered to resolve that part of the dispute by arbitration pursuant to s.739 of the Act and the agreement of the parties in accordance with the procedure at clause 1.11 of the Agreement.
Metro opposed the jurisdiction of the Commission to resolve the questions of fact (the Union’s proposed questions 2 and 3) on grounds which the Union rejected as “misconceived”. For the reasons that follow, I have declined to determine those questions.
The Agreement and the NES
The dispute concerns clause 2.8.7 of the Agreement which provides:
2.8.7 Transfer to a Safe Job
(a)Where an Employee is pregnant and, in the opinion of a registered medical practitioner, illness or risks arising out of the pregnancy or risks with the work make it inadvisable for the Employee to continue work, the Employee will, if the Company deems it practicable, be transferred to a safe job at the rate and on the conditions attached at the Employee’s full rate of pay prior to the transfer until the commencement of Parental Leave.
(b)If the transfer to a safe job is not practicable, the Employee may ask, or the Company will pay an eligible Employee ‘no safe job’ pay. If the Employee is not eligible they may be required to commence Parental Leave for such period as is certified necessary by a registered medical practitioner. In such cases the fourteen (14) week period of Parental Leave will then be due to commence.
The Agreement commences with various machinery provisions, including that at 1.4:
1.4 Relationship to Awards and Agreements and the NES
[…]
1.4.2 This Agreement will be read and interpreted in conjunction with the National Employment Standards (NES). Where there is an inconsistency between this agreement and the NES, and the NES provides a greater benefit, the NES provision will apply to the extent of the inconsistency. Nothing in the Agreement is intended to provide for an entitlement which is less than the NES.
The NES contains provisions for “transfer to a safe job” and “paid no safe job leave” at ss.81 and 81A, respectively (Annexure B).
The evidence
The Union’s case proceeded with focus on the circumstances of a Ms Tamara Fabbro and for present purposes the genesis of the dispute may be understood with regard to the following evidence:
Since July 2014, Ms Fabbro is (and has been) employed as a Multi Modal Authorised Officer with Metro. As a Multi Modal Authorised Officer, Ms Fabbro works a 4-week roster rotation (9 days of work, 5 days off; then 7 days of work, 2 days off; then 3 days of work, 2 days off) on shifts at 06.30am to 02.30pm (Early); 10.30am to 06.30pm (Mid); or 12.30pm to 08.30pm (Late). As part of this roster, Ms Fabbro works 2 of 4 weekends (Saturday and Sunday) in each 4-week roster cycle and earns $7,802 for the 4-week roster cycle.
In late 2020, Ms Fabbro became pregnant. On 18 May 2021, there was a meeting with Ms Fabbro in which transfer to a safe job and Metro’s Pregnancy and Parental Leave Procedure was discussed – whether that meeting resulted in a “direction” by Metro that Ms Fabbro transfer to a safe job is disputed. On 31 May 2021, Ms Fabbro emailed her area manager in which she sought clarification as to whether a transfer to a safe (office bound) role was required after 20 weeks’ pregnancy and raised the potential loss of pay which may occur as a result of the transfer. There was a further meeting invitation to Ms Fabbro to discuss her circumstances issued on 1 June 2021. Ms Fabbro continued to work as normal on the basis of a medical clearance, which she did until 26 June 2021 pursuant to a medical certificate provided to Metro.
On 16 June 2021, Ms Fabbro informed Metro of her preference to be “taken off the tracks and moved into a safe role please :)”, from 28 June 2021. Mr Stanisic’s evidence was that there were no “safe jobs” that would enable Ms Fabbro to work her Multi Modal Authorised Officer roster. On 24 June 2021, Metro confirmed that Ms Fabbro would be transferred to a role in the Learning and Development team at 700 Collins Street.
From 28 June 2021, Ms Fabbro worked in the office for the Learning and Development team on a Monday to Friday (day work) roster and was paid a gross amount of $6,815 for a 4-week roster cycle. Ms Fabbro calculated the reduction in gross (pre-tax) earnings as $986 less over a 4-week period, or $246.50 per week.
For completeness, there was also some evidence of a prior pregnancy and transfer to a “safe job”, with which the Union and Ms Fabbro take no issue. That is, in 2019, Ms Fabbro became pregnant and was transferred to a “safe job” in Network Security and Surveillance Department (NSS). She had worked hours in accordance with her previous Multi Modal Authorised Officer role. Around 2 to 4 weeks before commencing parental leave, Ms Fabbro had been changed to day work only (Monday to Friday) in the NSS and continued to receive her full rate of pay being the amount she would have earned had she not been transferred.
The competing contentions
Union
The Union argued that the Commission ought construe clause 2.8.7 of the Agreement in the following way:
First, it pointed to clause 1.4 which explains the relationship of the Agreement to any awards, other agreements and the NES and clause 1.4.2 - which provides that regard must be had to the relevant NES provisions and expresses the intent of the framers of the Agreement that “Nothing in the Agreement is intended to provide for an entitlement which is less than the NES.”. Therefore, the NES forms part of the relevant context when undertaking the task of construction.
The Union argued that the contextual assistance provided by the NES is of greater significance when there is an “overlap” between a term of the Agreement and a provision of the NES, clause 2.8.7(a) being one such “overlapping” term. Specifically, that clause 1.4.2 commands that clause 2.8.7(a) must be construed consistently with ss.81(2) and (3) of the NES in the Act:
a)Consistent with s.81(2), the starting point or default position is that the safe job must involve “no other change to the employee’s terms and conditions of employment”. This necessarily requires that an employee must be provided with the total number of ordinary hours and when those ordinary hours are worked; and must be paid the same loadings, monetary allowances and penalty rates that the employee would have received had she not been transferred to the safe job.
b)Under s.81(3)(a), an employee is entitled to maintain her pre-transfer ordinary hours of work unless she agrees to alter the number of pre-transfer ordinary hours of work pursuant to s.81(3)(b). Properly construed:
·s.81(3)(a) is referring to both the total number of ordinary hours and when those ordinary hours are worked; whereas, in contrast
·s.81(3)(b) is only referring to the number of ordinary hours.
And it follows that, by operation of clause 1.4.2, clause 2.8.7(a) must be construed consistently with s.81(3)(a) to require Metro to provide an employee who has been transferred to a safe job under the clause with a position that maintains, as per the employee’s pre-transfer position:
· the total number of ordinary hours; and
· when those ordinary hours are worked.
The Union said that the only circumstance in which Metro is permitted to deviate from this obligation is where s.81(3)(b) is engaged by the employee agreeing to a different number of ordinary hours and when those hours are worked.
Irrespective of whether those contentions are accepted, the Union submitted that properly construed clause 2.8.7(a) requires Metro to pay an employee who has transferred to a safe job under the clause the same wages (including shift loadings, monetary allowances and penalty rates) that the employee would have received had she not been transferred to the safe job. In this respect, it contended that the phrases “full rate of pay” and “prior to the transfer” are significant in the context:
· “full rate of pay”, the most critical phrase, attracts an ordinary meaning that is non-controversial and captured by the definition at s.18 of the Act;
· “prior to the transfer”, has a purpose which is to recognise and preserve the rate of pay prior to the transfer;
· “full rate of pay prior to the transfer”, when read as a whole, refers to the full rate of pay attached to the position the employee was in before the transfer, as unambiguously captured in s.81(4) of the NES in the Act,
and this construction is consistent with the intention of ss.81 and 81A of the NES in the Act.
Further textual matters in support were described as:
· the words at clause 2.8.7(a) “..at the rate and on the conditions attached at the Employee’s full rate of pay prior to the transfer” with the meaning of “the conditions” - said to plainly include the roster pattern that was worked by the employee prior to the transfer;
· although it was open to the drafters to provide otherwise, the clause makes no reference to payment being made to the transferred employee for the hours worked in the safe job – the only temporal point to determine the entitlement is that prior to the transfer;
· the entitlement to transfer to a safe job must be considered in the context of the other option that is available to an employer when it is no longer safe for an employee to continue in her present position – that is, under clause 2.8.7(b), Metro can put an employee on “no safe job pay” whereby the employee takes time off work and is entitled to be paid her base rate of pay (which excludes loadings, monetary allowances and penalty rates) (s.81A(2)) – an incentive to Metro to facilitate the maintenance of pre-transfer hours and a “more likely” construction that employees that are providing labour are to be remunerated at a higher rate which includes loadings, monetary allowances and penalty rates rather than paid the same level of remuneration as those who have been transferred to a safe job and continue at work.
With respect to the interaction between clause 2.8.7 of the Agreement and the NES, the Union contended that, by operation of clause 1.4.2 and insofar as clause 2.8.7 contains terms in respect of which the NES provides a greater benefit, the NES provision “will apply to the extent of the inconsistency” (citing the interaction rules at ss.55 and 56 of the Act). It highlighted one such greater benefit as the existence of an entitlement under the NES (noting the use of the mandatory term “must” in s.81(2)) for an employee to be transferred to a safe job which is available in contrast to clause 2.8.7 of the Agreement which purports to grant an employer the discretion to not transfer the employee to a safe job if the employer does not deem it “practicable”. In this regard, the Union argued clause 1.4.2 operates such that the greater benefit in s.81(2) for an employee to be automatically transferred to a safe job which is available “trumps” clause 2.8.7 insofar as it purports to limit this right to transfer.
However, the Union said it must be understood that insofar as clause 2.8.7 provides terms which are either the same as the NES or more beneficial than the NES such terms continue to operate and confer entitlements. So, to the extent that clause 2.8.7(a) obliges Metro to provide an employee with the same ordinary hours of work (the total number of ordinary hours and when those ordinary hours are worked) as the employee’s pre-transfer position then the Union contends that is the same as the NES entitlement and operates in parallel with s.81(2). And, in the event that the words “full rate of pay prior to the transfer” in clause 2.8.7(a) are more beneficial than the words “the employee’s full rate of pay (for the position she was in before the transfer) for the hours that she works in the risk period” in s.81(4) of the NES in the Act then the words at clause 2.8.7(a) prevail. However, if the view was to be taken that the entitlement to receive “full rate of pay prior to the transfer” under clause 2.8.7(a) was displaced by the NES then the words at s.81(4) of the NES in the Act would operate.
In summary, the Union contended that the Commission should answer its proposed questions in resolution of the dispute as follows:
Question 1: Yes. Further, the Commission should conclude that s.81(2) has operation and s.81(2) requires Metro to provide an employee who has been transferred to a safe job under the clause or the NES with a position that maintains as per the employee’s pre-transfer position: the total number of ordinary hours and when those ordinary hours are worked.
Question 4: Yes, in respect of any period that the employee has already performed work in the safe job. However, when an agreement to a different number and arrangement of ordinary hours is not established and the period in which the employee is unable to safely work in their ordinary position is ongoing an employee could (in the absence of agreement) be put on “paid no safe job leave” pursuant to s.81A of the NES in the Act or “no safe job pay” per clause 2.8.7(b) of the Agreement.
Question 5: Yes. If the Commission concludes that the entitlement to receive “full rate of pay prior to the transfer” under clause 2.8.7(a) was displaced by the NES, then the Commission should conclude that the reference to “the employee’s full rate of pay (for the position she was in before the transfer) for the hours that she works in the risk period” in s.81(4) requires Metro to pay an employee who has been transferred to a safe job under the clause the loadings, monetary allowances and penalty rates that the employee would have received had she not been transferred to the safe job.
Metro
Metro contended that the Union’s assertion that the claimed entitlements arise under either or both of clause 2.8.7 of the Agreement and the NES – characterised as an attempt to collapse the distinction between two discrete sources in favour of a “hybrid” entitlement - is wrong. In this regard it argued that:
Clause 1.4.2 requires that the Agreement is “read and interpreted in conjunction with” the NES (Metro’s emphasis added), the function of that phrase given meaning by the balance of clause 1.4.2 which commands the reader to interpret the Agreement alongside the NES and, where the NES provides a greater benefit, the NES provision applies to the extent of any inconsistency.
Metro asked the Commission to find that this does not mean that one engages in an “ad hoc” drafting exercise to “cobble together” particular phrases or components of the Agreement and the NES provisions. It argued that such approach would impermissibly divorce those components from their context, and yield an agreement with terms both uncertain and likely incapable of explanation in the sense contemplated by s.180(5) of the Act. Rather, the Agreement contemplates that where an Agreement provision deals with a matter also dealt with under the NES, the provision providing the greatest benefit prevails.
Regarding the identification of an inconsistency and the greater benefit, Metro submitted each provision ought be construed as follows:
With regard to the NES provision, Metro pointed to the preconditions or “qualifying” criteria at s.81(1) of the NES in the Act and asked the Commission to find that, only if the employee is pregnant and the provision of evidence meeting certain statutory qualifying criteria are met, does the entitlement to transfer to an appropriate safe job at ss.81(2) and (3) arise. That qualifying criteria being:
· First, that the employee is fit for work;
· Second, that it is inadvisable for the employee to continue in her present position;
· Third, that inadvisability must be for a stated and defined risk period; and
· Fourth, that inadvisability must be because of either illness or risks arising from pregnancy or hazards connected with the position,
and evidence of this must be given to the employer before the provision is triggered as the plain text of the provision requires.
If those qualifying criteria at s.81(1) of the NES are met, then ss.81(2) and 81(3) define the entitlement to transfer to an appropriate safe job and what an appropriate safe job is. An appropriate safe job must have either “the same ordinary hours of work as the employee’s present position or a different number of ordinary hours agreed to by the employee”. Metro says the agreement in this respect is definitional in that, if the employee does not agree to the different number of ordinary hours, then the job is not an “appropriate safe job” as defined. If there is an “appropriate safe job” then “the employer must transfer the employee to that job for the risk period, with no other change to the employee’s terms and conditions of employment” and must pay in accordance with the payment rule at s.81(4): “the employer must pay the employee for the safe job at the employee’s full rate of pay (for the position she was in before the transfer) for the hours that she works in the risk period”. If there is no “appropriate safe job” then the NES comprehends two alternatives:
· paid no safe job leave under s.81(a), if the employee is entitled to unpaid parental leave, the employee has complied with the notice and evidence requirements of s.74 for taking unpaid parental leave – then the employee is entitled to their base rate of pay for their ordinary hours;
· unpaid no safe job leave under s.82(a), where the employee is not otherwise entitled to unpaid parental leave and they meet certain evidentiary requirements.
Metro argued that the NES does not contemplate any other scenario - there is no provision at all in the NES for an employee refusing or withholding their agreement to transfer to a safe job with different ordinary hours and the employee nonetheless performing that role rather than taking the unsafe job leave (which, it was said, is the scenario contended by the Union that Ms Fabbro falls within).
With regard to the Agreement provision, clause 1.4.2 is said by Metro to establish a mechanism by which the NES takes precedence. It does not operate to “pick up and apply” the words of the NES as Agreement terms or read up (or read down) Agreement terms beyond the contextual assistance the NES can properly provide. There being two conditions:
· where there is an inconsistency between this Agreement and the NES; and
· the NES provides a greater benefit.
Metro said that clause 2.8.7 similarly starts with qualifying criteria. First, and in common, the employee must be pregnant. Then:
· there must be an opinion from a registered medical practitioner;
· that opinion must have certain characteristics: it must be to the effect that illness or risks arising out of the pregnancy or risks with the work make it inadvisable for the employee to continue work;
· the necessary implication is that the opinion must be provided to Metro – being a necessary component in Metro deeming or determining whether the transfer is or is not practicable.
Once those qualifying criteria in the Agreement are met, the clause creates an entitlement which is conditional on Metro deeming that a safe job transfer is “practicable”. The clause imposes on its face no limitation on the number or arrangement of hours that can be worked in a safe job. Metro accepted that this is capable of being detrimental when compared to the NES given the restrictions placed on the number and arrangement of hours and the ability for an employee to withhold their agreement rather than an employer effectively deeming whether or not the transfer is practicable. At least to the extent of such greater benefit, Metro contended that the effect of clause 1.4.2 and ss.55 and 56 of the Act is that clause 2.8.7(a) has no effect and the Commission is confined to looking at the sources of entitlements under the NES rather than clause 2.8.7.
In any event, the payment rule at clause 2.8.7 provides “at the rate and on the conditions attached at the employee’s full rate of pay prior to the transfer until the commencement of parental leave”. Metro contended these words plainly reflect a drafting error and for a sensible reading of the clause being “at the rate and on the conditions attached to the employee’s position prior to the transfer until the commencement of the parental leave”.
It said clause 2.8.7 requires Metro to pay an employee their pre-transfer full rate of pay (including relevant loadings, penalties, allowances) for the hours the employee works in the post-transfer role. That full pre-transfer rate of pay does not necessarily equate to the same payment amount as the employee received in her pre-transfer role. Any difference in hours worked can only occur by agreement with the employee:[4] if she does not agree, she will be entitled to “paid no safe job leave” under clause 2.8.7(b) (construed conformably with s.81A).[5] Four factors were relied on in support of this construction:
First, the noun “rate” by reference to its ordinary meaning is clear that the “rate” of pay is quite distinct from the amount of the payment itself: the rate has a relationship with the hours actually worked, and is “used as a standard or measure” or the “charge per unit” of those hours actually worked. Had the Agreement intended to preserve pre-existing payment amounts, rather than rates, it could have said so: it might, for example, have deployed the composite phrase “without loss of pay” used elsewhere in the Agreement.[6]
Second, the Union’s construction of clause 2.8.7 (extending to ss.81 and 81A of the Act) leads to plainly unintended outcomes, for example:
(a)an employee may work a range of roster patterns as part of their pre-transfer position. The range of different roster patterns – both in hours worked, when those hours are worked, and the particular conditions in which they are worked – may lead to materially different take home pay outcomes which fluctuate from week to week, or across a month or several months, and are incapable of advance determination. If clause 2.8.7 (and s.81 of the Act) is intended to preserve the employee’s take home pay, then there is the problem of how to calculate the take home pay for the “position”. Any averaging mechanism faces two further problems: how to determine the period over which those fluctuating outcomes ought be averaged, and, critically, the fact that importing such a mechanism would read substantial provisions into clause 2.8.7 (and s.81) which are simply “unsupportable” on their plain text; and
(b)a “safe job” under clause 2.8.7 may have a different number of ordinary hours to the pre-transfer role. This means that the different number of ordinary hours to which an employee can agree may be a substantially greater or lesser number. For example, an employee working 25 hours per week in a role with relevant hazards might agree to work a safe job comprising 35 hours per week. On the Union’s construction, paying the employee “the same wages (including shift penalties/allowances etc.) as they were receiving prior to being transferred to the safe job” would result in that employee working those 10 additional hours without payment. Conversely, an employee working 38 hours per week in a role with relevant hazards might agree to work a safe job comprising 7.5 hours per week. Such outcome could not have been intended.
Third, clause 2.8.7 also requires that the “safe job” be “on the conditions attached” to the pre-transfer position. Those conditions relevantly include the qualifying conditions for the payment of penalties and allowances (for example, that a weekend penalty is payable for hours worked on Saturdays and Sundays, but not otherwise) applicable to that pre-transfer role. In Ms Fabbro’s Multi Modal Authorised Officer role, weekend penalties are payable as a condition of that role only where weekend shifts are in fact worked. The Union’s construction would run counter to “the conditions attached” to Ms Fabbro’s pre-transfer role. In the same way, s.81 requires the employee’s transfer to the safe job to involve “no other change to the employees terms and conditions of employment”. It is precisely those unchanged terms and conditions of employment which must regulate when and in what circumstances penalties and loadings are payable.
Fourth, Metro’s construction is consistent with the plain text of the NES (against which clause 2.8.7 falls to be construed). An “appropriate safe job” under s.81(3) is one that has either the same ordinary hours of work as the employee’s pre-transfer position, or (relevantly) a different number of ordinary hours agreed to by the employee. Importantly, s.81(4) requires the employer to pay the employee for the safe job “at the employee’s full rate of pay (for the position she was in before the transfer) for the hours that she works…”(Metro’s emphasis added).
The inclusion of the words “for the hours that she works” makes plain that s.81 does not operate to preserve an employee’s pre-transfer take home pay in all circumstances, but instead preserves the employee’s pre-transfer rate of pay. If, for example, an employee whose pre-transfer role comprised 38 ordinary hours per week agreed to transfer (under s.81(3)(b)) to an appropriate safe job with 15 ordinary hours per week, that employee would not be paid for 38 hours. Rather, that employee would be paid for the 15 ordinary hours worked, but at the same rate of pay (including any loadings and allowances) which would apply were the employee to work the post-transfer hours in the pre-transfer role. Critically, an arrangement involving different ordinary hours can only occur by agreement with the employee (thus ensuring that the employee’s interests are appropriately protected).
A contextual analysis is also said to favour Metro’s construction. Where a transfer to a safe job is not practicable (under clause 2.8.7), the employee is entitled to “no safe job pay”. Whilst that term is not defined in the Agreement, it takes its colour (in light of clause 1.4.2) from the “paid no safe job leave” provisions in s.81A of the Act. Those provisions require an employer to pay an eligible employee “at the employee’s base rate of pay for the employee’s ordinary hours of work in the risk period”. “Base rate of pay” is in turn defined in s.16 to exclude (amongst other things) loadings, monetary allowances, overtime and penalty rates.
The fact that those additional amounts are excluded from payments made during a period of paid no safe job leave demonstrates: that contingent payments (such as loadings, penalties) are just that, contingent upon the employee actually working at the particular time or in the particular circumstance to which the contingent payment is directed; and that safe job arrangements under the Agreement (whether by means of an alternative role, or paid leave) are not intended to preserve the employee’s take home pay regardless of the hours worked in the post-transfer role.
Other parts of the Agreement are also said to recognise that such contingent payments are payable only in circumstances where the employee has worked at the relevant time or in the relevant circumstance. For example:
(a)clause 2.18 establishes an accident make-up pay mechanism which increases a qualifying employee’s pay from their workers compensation amount up to their base weekly rate of pay;[7]
(b)clause 2.21 establishes a salary maintenance mechanism for redundant employees redeployed to a position with a lower classification. That mechanism preserves the employee’s pre-redundancy “substantive rate of pay for ordinary hours of work”, but provides that “any payment other than ordinary hours (including penalty payments that are attributed to the ordinary hours of work) is to be paid at the rate for the classification of the position being occupied”;
(c)clause 3.8 requires Metro to pay employees who are “ready and willing and available for all work” (that is, regardless of whether they are actually required to work) a guaranteed minimum amount “equivalent to their ordinary hours at their ordinary rate of pay for their classification”, but excluding shift penalties, weekend penalties, public holiday penalties and overtime.
Metro’s construction also reflects broader distinctions arising under the Act between preserving “rates of pay” on the one hand, and actual (or take home) pay on the other. Where the Act intends to preserve take home pay (rather than merely a particular rate of pay) it does so expressly. Subdivision D, Division 8 of Part 6-3A of the Act establishes a mechanism for the Commission to make orders remedying reductions in ‘take home pay’ for transferring employees covered by a copied State award upon that award ceasing to operate.[8] Importantly for present purposes, “take home pay”’ is defined with reference to “the pay the employee actually receives”.[9] That Parliament eschewed such a mechanism in s.81 – and, to the contrary, expressly applied the pre-transfer rate of pay to the post-transfer hours – weighs in favour of Metro’s construction.
Lastly, a purposive analysis was argued as favouring Metro’s construction. Penalties and allowances, by their very nature, being intended to compensate an employee for the inconvenience of working at unsociable hours or in demanding or uncomfortable conditions, and in certain circumstances to discourage employers from arranging work in that manner.[10] They are not intended to create a “de facto” increased rate of pay payable regardless of the particular circumstances applicable to the work actually performed. To construe clause 2.8.7 (or s.81) so as to apply penalties and allowances in circumstances where their qualifying conditions are not met runs counter to that purpose.
In summary, Metro contended that the answers to proposed questions 1 and 5 are: respectively, “no”.
Consideration
The principles regarding construction of enterprise agreements are well established and there was no dispute that the following, as distilled by a Full Federal Court in WorkPac Pty Ltd v Skene, [11] are most pertinent to this dispute:
a)The starting point for interpretation of an enterprise agreement is the ordinary meaning of the words, read as a whole and in context;[12]
b)The interpretation turns on the language of the particular agreement, understood in the light of its industrial context and purpose;[13]
c)The words are not to be interpreted in a vacuum divorced from industrial realities. Rather, industrial agreements are made for various industries in the light of the customs and working conditions of each, and they are frequently couched in terms intelligible to the parties but without the careful attention to form and draftsmanship that one expects to find in an Act of Parliament;[14] and
d)The framers of such documents were likely of a “practical bent of mind” and may well have been more concerned with expressing an intention in a way likely to be understood in the relevant industry rather than with legal niceties and jargon, so that a purposive approach to interpretation is appropriate and a narrow or pedantic approach is misplaced. [15]
Metro also pointed to the following well settled principles:
(a)as with commercial contracts, the Court will:
(i)prefer a construction of an enterprise agreement which gives effect to the presumed purpose of the parties;[16] and
(ii)strain against interpreting an agreement so that a particular clause is ineffective (that is, given “no work to do”), particularly if a meaning can be given to it consonant with the other provisions in the agreement;[17]
(b)the history and terms of enterprise agreements applicable to the relevant employer and employees, including the context in which they were brought into existence and implemented, form part of the relevant context in which a particular term falls to be construed.[18] The circumstances of the origin and use of a clause “are plainly relevant to an understanding of what is likely to have been intended by its use”.[19] This is particularly so where that context demonstrates a common understanding about a particular state of affairs. If such a common understanding existed when the agreement was made, it should not be departed from when the Court comes to construe it at a subsequent time;[20] and
(c)the relevant context can extend to ideas giving rise to a commonly-used industrial expression.[21]
It is appropriate to first address the relationship between the Agreement and the NES. The disputed provision at clause 2.8.7 does not expressly refer to the NES, but plainly provides for “transfer to a safe job” where an employee is pregnant. The prefacing or introductory provisions of the Agreement at clause 1.4 expressly provide for the “relationship” of the Agreement to “Awards and Agreements and the NES”. It commences, at clause 1.4.1, by asserting that the Agreement is “a comprehensive agreement”. But it is not contentious that, by the words of clause 1.4.2, the parties have effectively struck an agreement which is to be read “in conjunction with” and effectively gives precedence to the NES “where there is an inconsistency between the agreement and the NES, and the NES provides a greater benefit”.
The statutory context warrants some regard in accordance with the well-established principles. An enterprise agreement is an instrument made on approval of a majority of the relevant employees, operative only after approval of the Commission. The Commission’s power to approve an enterprise agreement is confined by the statute. There is “a basic rule”, at s.186 of the Act that, if an application for approval of an enterprise agreement is made under s.185, the Commission must approve the agreement if the requirements of ss.186 and 187 are met. One of those requirements is that the Commission must be satisfied that the terms of the agreement do not contravene s.55 of the Act (s.186(2)(c)).
Section 55 deals with the interaction between the NES and enterprise agreements (and modern awards). The legislative intent was to create an enforceable set of minimum entitlements for all eligible employees and prohibit their exclusion (or purported exclusion) by the terms of an enterprise agreement and, in this way, the statute effectively gives precedence to the NES over other instruments (subject to certain specified exceptions).[22] Specifically, s.55 of the Act provides that an enterprise agreement:
a)must not exclude the NES or any provision of the NES (s.55(1));
b)may include certain permitted terms which the NES has effect subject to (none of relevance to this dispute) (ss.55(2) and (3));
c)may also include terms that are “ancillary or incidental to” the operation of an entitlement of an employee under the NES; and terms that “supplement” the NES, but only to the extent that the effect of those terms is not detrimental to an employee in any respect when compared to the NES (s.55(4));
d)may include terms that have the same (or substantially the same) effect as provisions of the NES, whether or not ancillary or supplementary terms are included as referred to in s.55(4) (s.55(5)) but, “to avoid doubt”, if an enterprise agreement includes terms permitted by s.55(4) or s.55(5), then, to the extent that the terms give an employee an entitlement (the agreement entitlement) that is the same as an entitlement (the NES entitlement) of the employee under the NES:
·those terms operate in parallel with the employee’s NES entitlement, but not so as to give the employee a double benefit; and
·the provisions of the NES relating to the NES entitlement apply, as a minimum standard, to the award or agreement entitlement,
Note: for example, if the agreement entitlement is to 6 weeks of paid annual leave per year, the provisions of the NES relating to accrual and taking of paid annual leave will apply, as a minimum standard, to 4 weeks of that leave (s.55(6));
e)to the extent that a term of an enterprise agreement is permitted by s.55(4) or s.55(5), the term does not contravene s.55(1) (s.55(7)).
Section 56 of the Act provides that a term of an enterprise agreement has no effect to the extent that it contravenes s.55.
It may be observed that NES precedence provisions in terms of clause 1.4.2 feature in many an enterprise agreement. There is authority regarding the reliance on such provision by the Commission in order to reach the necessary state of satisfaction at the approval stage. A NES precedence provision in such terms effectively guarantees that there shall be no inadvertent or unintended exclusion of the NES even where an enterprise agreement deals with the same subject matter and, in this way, might facilitate its approval in the face of provisions that might otherwise fall foul of the requirements at s.186(2)(c) and s.55 of the Act. Notwithstanding its relatively common use, neither party was able to draw the Commission’s attention to authorities as to the application of a like clause in circumstances of an inconsistency.
The provision at the heart of the dispute presently before the Commission, at clause 2.8.7 of the Agreement, is in some respects poorly drafted – grammatically, and to the extent that key terms are undefined. I have carefully considered the arguments of the Union which have some merit. However, with regard to the materials before the Commission and the relevant context, I favour the approach of Metro. I consider this rests most comfortably with the legislative intent of the NES as a set of conditions to which all employees are entitled as a basic minimum standard. To the extent that the parties, by their agreement, have supplemented the NES or agreed to ancillary terms this is permissible but only to the extent that the effect of those terms is not detrimental to an employee in any respect when compared to the NES (s.55(4)). By clause 1.4.2, the parties have taken this statutory rule further by providing that where there is an inconsistency and the NES provides a greater benefit then it is the NES provision that will apply to the extent of the inconsistency. Whilst I accept that clause 1.4.2 requires harmonious construction with the NES, I prefer the argument put by Metro that this task is distinct from transplanting NES terms as “de facto” Agreement terms which results in a hybrid entitlement under the Agreement and the NES, the text of which appears in neither source.
In construing the provisions of the Agreement and the NES, it is plain on the face of both clause 2.8.7 and s.81 that each commences with certain pre-conditions (albeit differently expressed pre-conditions). Both apply only to a pregnant employee. From there, the pre-conditions are expressed in slightly different terms. Whilst the Agreement is clearer as to what standard of opinion is required and it may logically be inferred that engagement of such entitlement necessitates production of such opinion, the words of the Agreement do not obviously mandate the provision of evidence by the employee to Metro. As much is arguably inconsistent with the NES, but the NES entitlement not of greater benefit to an employee in this respect.
Once the pre-conditions of the Agreement are met, the Agreement entitlement to be transferred to a safe job is at the discretion of Metro, if Metro “deems it practicable”. Whilst at the ultimate discretion of Metro, in my view it is encumbent on Metro to take all reasonable steps in pursuit of identifying a “safe job” that is as closely aligned to the pre-transfer role and roster as practicable. If Metro so deems it practicable, then the transfer to a safe job is to be on the conditions that follow. That is, “at the rate and on the conditions attached at the Employee’s full rate of pay prior to the transfer until the commencement of Parental Leave”. Such provision is grammatically unsound and, depending on the circumstances, may operate in a manner that is inconsistent with the NES. At least to the extent such inconsistency arises and the NES provides a greater benefit, I prefer the view that the effect of clause 1.4.2 and ss.55 and 56 of the Act is that clause 2.8.7(a) has no effect and the source of the entitlements is properly derived under the NES rather than clause 2.8.7.
Where there is no such inconsistency then the better view is that, properly construed, clause 2.8.7 requires Metro to pay an employee their pre-transfer full rate of pay (including relevant loadings, penalties, allowances) for the hours the employee works in the post-transfer role. That full (pre-transfer) rate of pay does not necessarily equate to the same total value of payment or payment amount (that is, the same take home pay) as the employee received in her pre-transfer role; the total amount of payment in the transferred role will depend on the hours and rosters worked in the transferred role. Any difference in hours worked can only occur by agreement with the employee (by operation of clause 1.4.2 and s.81(3)). If the employee does not agree, she will be entitled to “paid no safe job leave” under clause 2.8.7(b) (construed in conformity with s.81A, and otherwise meeting the requirements therein).
In adopting this approach, the answers to proposed questions 1, 4 and 5 are:
Question 1: Does clause 2.8.7(a) of the Agreement and/or s.81(2) of the Act require Metro to provide an employee who has been transferred to a safe job under clause 2.8.7(a) and/or s.81(2) of the Act with the same ordinary hours of work (that is the total number of ordinary hours and when those ordinary hours are worked) as the employee’s pre-transfer position, unless the employee agrees to different number of ordinary hours?
No.
Question 4: If the answer to question 1 is “yes”, in the event that Metro does not provide an employee who has been transferred to a safe job under the clause with the same ordinary hours of work (that is the total number of ordinary hours and when those ordinary hours are worked) as the employee’s pre-transfer position, and the employee has not agreed to a different number of ordinary hours, does clause 2.8.7(a) of the Agreement and/or s.81(4) of the Act require Metro to pay the employee for the period that the employee is in the safe job, the loadings, monetary allowances and penalty rates that the employee would have received had she not been transferred to the safe job?
As the answer to question 1 is “no”, it is strictly unnecessary to answer proposed question 4.
Question 5: Irrespective of the answers to questions 1 to 4 above, does the reference to:
a) “full rate of pay prior to the transfer” in clause 2.8.7(a) of the Agreement; and/or
b) “the employee’s full rate of pay (for the position she was in before the transfer) for the hours that she works in the risk period” in s.81(4) of the Act,
require Metro to pay an employee who has transferred to a safe job under the clause the loadings, monetary allowances and penalty rates that the employee would have received had she not been transferred to the safe job?
No.
Questions 2 and 3
During the course of the proceedings, some leeway was afforded to the parties to modify their questions and arguments. The original application referred to a dispute about Ms Fabbro and at least foreshadowed it may have broader significance to other employees. The Union’s original submissions stated the dispute related to an individual employee, Ms Fabbro. The final submissions and evidence related to Ms Fabbro and a Ms Ledua.
Proposed questions 2 and 3 concern whether or not each of Ms Fabbro and Ms Ledua agreed to work a different number of ordinary hours in their respective safe jobs. It appears to be common ground that each in fact worked a safe job, and each in fact worked a different number of ordinary hours in those safe jobs for periods of several months.
I am attracted to the view that each of Ms Fabbro’s and Ms Ledua’s circumstances demonstrate at least their tacit agreement to work their safe jobs on the associated rosters. In the alternative, a finding that neither Ms Fabbro nor Ms Ledua agreed to work different ordinary hours in their safe jobs may indeed have jurisdictional consequences as Metro contended.
Accordingly, I decline to express a view as to the substance of proposed questions 2 and 3. With the benefit of a determination as to the questions of construction, the parties are at liberty to apply for further conciliation regarding the circumstances of Ms Fabbro and Ms Ledua which will be facilitated by the Commission if they so consent.
DEPUTY PRESIDENT
Appearances:
Mr Y. Bakri of Counsel for the Applicant.
Mr A. Pollock of Counsel for the Respondent.
Hearing details:
2022.
Melbourne (By Video).
16 February.
ANNEXURE A – Union’s proposed questions for determination
Does cl.2.8.7(a) of the Agreement and/or s.81(2) of the Act require Metro to provide an employee who has been transferred to a safe job under cl.2.8.7(a) and/or s.81(2) of the Act with the same ordinary hours of work (that is the total number of ordinary hours and when those ordinary hours are worked) as the employee’s pre-transfer position, unless the employee agrees to different number of ordinary hours?
If the answer to question 1 is “yes”, did Tamara Fabbro provide her agreement to a different number of ordinary hours in the safe job she worked from 28 June to 19 September 2021?
If the answer to question 1 is “yes”, did Esther Ledua provide her agreement to a different number of ordinary hours in the safe job she commenced working in on 24 November 2021?
If the answer to question 1 is “yes”, in the event that Metro does not provide an employee who has been transferred to a safe job under the clause with the same ordinary hours of work (that is the total number of ordinary hours and when those ordinary hours are worked) as the employee’s pre-transfer position, and the employee has not agreed to a different number of ordinary hours, does clause 2.8.7(a) of the Agreement and/or s.81(4) of the Act require Metro to pay the employee for the period that the employee is in the safe job, the loadings, monetary allowances and penalty rates that the employee would have received had she not been transferred to the safe job?
Irrespective of the answers to questions 1 to 4 above, does the reference to:
c) “full rate of pay prior to the transfer” in clause 2.8.7(a) of the Agreement; and/or
d) “the employee’s full rate of pay (for the position she was in before the transfer) for the hours that she works in the risk period” in s.81(4) of the Act,
require Metro to pay an employee who has transferred to a safe job under the clause the loadings, monetary allowances and penalty rates that the employee would have received had she not been transferred to the safe job?
ANNEXURE B – Sections 81 and 81A of the NES
81 Transfer to a safe job
(1) This section applies to a pregnant employee if she gives her employer evidence that would satisfy a reasonable person that she is fit for work, but that it is inadvisable for her to continue in her present position during a stated period (the risk period) because of:
(a) illness, or risks, arising out of her pregnancy; or
(b) hazards connected with that position.Note: Personal information given to an employer under this subsection may be regulated under the Privacy Act 1988.
(2) If there is an appropriate safe job available, then the employer must transfer the employee to that job for the risk period, with no other change to the employee’s terms and conditions of employment.
Note: If there is no appropriate safe job available, then the employee may be entitled to paid no safe job leave under section 81A or unpaid no safe job leave under 82A.
(3) An appropriate safe job is a safe job that has:
(a) the same ordinary hours of work as the employee’s present position; or
(b) a different number of ordinary hours agreed to by the employee.
(4) If the employee is transferred to an appropriate safe job for the risk period, the employer must pay the employee for the safe job at the employee’s full rate of pay (for the position she was in before the transfer) for the hours that she works in the risk period.
(5) If the employee’s pregnancy ends before the end of the risk period, the risk period ends when the pregnancy ends.
(6) Without limiting subsection (1), an employer may require the evidence to be a medical certificate.
81A Paid no safe job leave
(1) If:
(a) section 81 applies to a pregnant employee but there is no appropriate safe job available; and
(b) the employee is entitled to unpaid parental leave; and
(c) the employee has complied with the notice and evidence requirements of section 74 for taking unpaid parental leave;
then the employee is entitled to paid no safe job leave for the risk period.
(2) If the employee takes paid no safe job leave for the risk period, the employer must pay the employee at the employee’s base rate of pay forthe employee’s ordinary hours of work in the risk period.
[1] AE508102.
[2] Exhibits A1, A2, A3 and A4.
[3] Exhibit R1.
[4] Such is contended to be the effect of s.81(3) of the Act in light of the operation of clause 1.4.2 of the Agreement.
[5] Subject to otherwise meeting the requirements of that provision.
[6] See clause 2.4.5 of the Agreement.
[7] Save for the inclusion of any applicable ‘acting in higher’ allowance being paid at the time of the injury (see clause 2.18(b)(vi)). That allowance said to be distinguished on the basis that it is tied to the particular pre-transfer role itself (rather than being tied to the performance of work during particular shifts or in particular circumstances).
[8] ss.768BR-768BS of the Act.
[9] s.768BR(2) of the Act.
[10] Citing Drake-Brockman ACJ’s and Sugerman J’s discussion in Inthe matter of applications by organisations of employees for awards and variations of certain awards with respect to rates of pay for work performed on Saturdays and Sundays (1947) 58 CAR 610 at 615-617 and 621-622.
[11] [2018] FCAFC 131.
[12] City of Wanneroo v Holmes (1989) 30 IR 362 (Holmes) at 378..
[13] Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241 (Amcor) at [2].
[14] Holmes at 378–9, citing Geo A Bond & Co Ltd (in liq) v McKenzie [1929] AR (NSW) 498 at 503.
[15] Kucks v CSR Limited (1996) 66 IR 182 at 184; Shop Distributive and Allied Employees’ Association v Woolworths SA Pty Ltd [2011] FCAFC 67 at [16]; Amcor at [96]..
[16] Qube Ports Pty Ltd v Maritime Union of Australia [2018] FCAFC 72 at [65].
[17] Chapmans Ltd v Australian Stock Exchange Ltd (1996) 67 FCR 402 at 411; Dovuro Pty Ltd v Wilkins (2000) 105 FCR 476 at [152]; Zhang v ROC Services (NSW) Pty Ltd (2016) 93 NSWLR 561 at [121] and [257]; Prowl Pty Ltd v DL Brookvale Pty Ltd [2018] NSWSC 1255.
[18] Duck v Airservices Australia (No 2) [2019] FCA 1148 at [27].
[19] Short v FW Hercus Pty Ltd (1993) 40 FCR 511 (Hercus) at 517.
[20] Transport Workers' Union of Australia v Linfox Australia Pty Ltd (2014) 318 ALR 54 at [37]-[41]; Australian Liquor, Hospitality and Miscellaneous Workers’ Union v Prestige Property Services Pty Ltd (2006) 149 FCR 209 at 222.
[21] Hercus at [7].
[22] Paragraphs 206-209 of the Explanatory Memorandum to the Fair Work Bill 2008 (Cth).
Printed by authority of the Commonwealth Government Printer
<PR739890>
0
17
0