Australian Workers' Union v UGL Resources (Contracting) Pty Ltd

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FEDERAL COURT OF AUSTRALIA

Australian Workers’ Union v UGL Resources (Contracting) Pty Ltd [2025] FCAFC 107

Appeal from: Australian Workers’ Union v UGL Resources (Contracting) Pty Ltd [2025] WAIRC 00015
File number: NSD 161 of 2025
Judgment of: RAPER, DOWLING AND LONGBOTTOM JJ
Date of judgment: 20 August 2025
Catchwords:  INDUSTRIAL LAW – construction of clause 14.8 of the UGL Resources (Contracting) Pty Ltd Karratha Enterprise Agreement 2019 – whether Shift Over Cycle rates payable to certain employees who worked shifts greater than 10 hours in duration – construction of s 323 of the Fair Work Act 2009 (Cth) – appeal dismissed.
Legislation:

Fair Work Act 2009 (Cth) ss 323, 570

Superannuation Guarantee Administration Act 1992 (Cth) s 6
Cases cited:

Amcor Ltd v Construction, Forestry, Mining and Energy Union [2005] HCA 10; 222 CLR 241

Australian Municipal, Administrative, Clerical and Services Union v Treasurer (Cth) (1998) 82 FCR 175

Australian Workers’ Union v UGL Resources (Contracting) Pty Ltd [2025] WAIRC 00015

Bluescope Steel (IS) Pty Ltd v Australian Workers Union [2019] FCAFC 84; 270 FCR 359

City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union [2006] FCA 813; 153 IR 426

City of Wanneroo v Holmes (1989) 30 IR 362

Coote v Mainline Access Pty Ltd (No 3) [2019] FCCA 383; 344 FLR 1

Dimkovski v Majorsite Property Group Pty Ltd [2024] FedCFamC2G 683

Euro Car Parts Pty Ltd v Cannon [2024] FCA 828; 304 FCR 349

Geo A Bond and Co Ltd (in liq) v McKenzie [1929] AR 499

James Cook University v Ridd [2020] FCAFC 123; 278 FCR 566

Kucks v CSR Ltd [1996] 66 IR 182

Sabapathy v Viveganantham [2024] FedCFamC2G 666

Shop Distributive and Allied Employees’ Association v Woolworths SA Pty Ltd [2011] FCAFC 67

Short v FW Hercus Pty Ltd (1993) 40 FCR 511

Treasury Wine Estates Vintners Ltd v Pearson [2019] FCAFC 21; 268 FCR 12

Wilkinson v Wilson Security Pty Ltd (No 3) [2024] FCA 705; 332 IR 387

Wollermann v Fortrend Securities Pty Ltd [2025] FCA 103; 337 IR 457

WorkPac Pty Ltd v Skene [2018] FCAFC 131; 264 FCR 536
Division: Fair Work Division
Registry: New South Wales
National Practice Area: Employment and Industrial Relations
Number of paragraphs: 84
Date of hearing: 28 July 2025
Counsel for the Appellant: Mr L Saunders with Mr W Nash
Solicitor for the Appellant: The Australian Workers’ Union
Counsel for the Respondent: Mr R Dalton KC with Ms C Pase
Solicitor for the Respondent: Corrs Chambers Westgarth

ORDERS

NSD 161 of 2025
BETWEEN: AUSTRALIAN WORKERS’ UNION
Appellant
AND: UGL RESOURCES (CONTRACTING) PTY LTD
Respondent

ORDER MADE BY:

RAPER, DOWLING AND LONGBOTTOM

DATE OF ORDER:

20 AUGUST 2025

THE COURT ORDERS THAT:

1.The appeal is dismissed.

Note:   Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


REASONS FOR JUDGMENT

THE COURT

  1. This appeal concerns the entitlements of nine fly-in fly-out workers employed by UGL Resources (Contracting)…

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Details
Case
[2025] FCAFC 107
Decision Date

CaseChat Overview and Summary

In the matter of Australian Workers' Union v UGL Resources (Contracting) Pty Ltd, the primary dispute revolves around the interpretation of clause 14.8 of the UGL Resources (Contracting) Pty Ltd Karratha Enterprise Agreement 2019, specifically concerning the applicability of Shift Over Cycle rates to employees who worked shifts exceeding 10 hours. The matter was heard in the Fair Work Commission, with the appeal subsequently dismissed by the Fair Work Court.

The central legal issue addressed by the court was the proper construction of clause 14.8 of the enterprise agreement and whether the Shift Over Cycle rates were payable to employees who worked shifts greater than 10 hours. The Australian Workers' Union contended that these rates were meant to compensate employees for working over 10 hours in any shift. In contrast, UGL Resources (Contracting) Pty Ltd argued that the Shift Over Cycle rates were intended to compensate for the inconvenience of working beyond rostered hours. The court had to determine the precise meaning and application of these rates within the context of the enterprise agreement and the Fair Work Act 2009.

The court adopted a contextual and purposive approach to interpreting the enterprise agreement, emphasizing the ordinary meaning of the words used, read as a whole and in context. The court reasoned that the Shift Over Cycle rates were intended to compensate for work outside ordinary rostered hours, not merely for overtime. The court found that the Shift Over Cycle rates did not apply to the 0.867 hours worked by the affected employees, as this would render the agreement commercially nonsensical and result in employees being compensated for no more than the minimum required under the agreement. The court also noted that the evidence from the negotiations surrounding the change to the 14:14 roster and the hours of work supported UGL’s construction of the agreement.

The appeal was dismissed, affirming the Industrial Magistrate's decision that the Shift Over Cycle rates did not apply to the 0.867 hours worked by the affected employees. This conclusion was based on the contextual and purposive interpretation of the enterprise agreement, considering the overall purpose and language of the agreement. The court's decision underscores the importance of a practical and contextual approach in interpreting enterprise agreements within the industrial relations framework.

Orders

Orders of the court

1. The appeal is dismissed.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

Consistent with those constructions, the AWU says the purpose of the Shift Over Cycle rates is to compensate an employee for working over 10 hours in any shift, whereas UGL says the purpose of the rate is to compensate the employee for the inconvenience of working over rostered hours.The Industrial Magistrate’s decision The Industrial Magistrate found that, when regard is had to the entire Agreement taken in context, the Shift Over Cycle rates do not apply to the 0.867 hours worked by the affected employees. In reaching this finding, the Industrial Magistrate reasoned (at [87]-[88]) that:(1)The intention of the Shift Over Cycle rates is to compensate employees for something more than overtime. Otherwise, the Agreement would not provide (as it does) for payment of unrostered overtime at the Shift Over Cycle rates or the rolled-up rates, whichever is applicable. (2)The Agreement also treats the Shift Over Cycle rates as, in effect, a penalty rate where the employer fails to give adequate notice of a roster change, indicating its intention to compensate for something other than overtime. (3)The Shift Over Cycle rates compensate employees who are required to work outside ordinary rostered hours and to that end superannuation does not apply to the Shift Over Cycle rates because it is work required to be done outside of work-designated Ordinary Time Earnings. (4)The change to the 14:14 roster meant a change to the roster cycle and roster hours or roster shift. This meant that fly-in fly-out employees were required to work their 38 ordinary hours per week or 152 hours per four week period by working new roster hours or roster shifts of 10.867 hours per shift. Under that roster, the Shift Over Cycle rates did not apply unless the employee was required to work in excess of 10.867 hours per shift.(5)To find otherwise would make “commercial nonsense” because fly-in fly-out employees would be compensated to do no more than the minimum requirement under the Agreement and would be liable to repay UGL superannuation paid on 0.867 hours to which they are not entitled. (6)While not determinative, the evidence of the negotiations surrounding the change to the 14:14 roster and the hours of work were consistent with UGL’s construction. One of the issues in that negotiation was the underpayment of superannuation of employees who worked 140 hours rather than 152. It is reasonable to infer then that the relevant union was aware of cl 14.8 and did not seek to substitute this clause in lieu of the 12 hours of superannuation.PRINCIPLES OF CONSTRUCTION The parties agreed that the relevant principles governing the construction of enterprise agreements are uncontroversial and not in dispute. The parties were content to accept the summary provided in James Cook University v Ridd [2020] FCAFC 123; 278 FCR 566 at [65] (Griffiths and SC Derrington JJ). These principles as summarised by Ridd are:(1)The starting point is the ordinary meaning of the words, read as a whole and in context (including the industrial context), citing City of Wanneroo v Holmes (1989) 30 IR 362 at 378; City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union [2006] FCA 813; 153 IR 426 at [53]; WorkPac Pty Ltd v Skene [2018] FCAFC 131; 264 FCR 536 at [197].(2)A purposive approach is preferred to a narrow or pedantic approach — the framers of such documents were likely to be of a practical bent of mind, citing Kucks v CSR Ltd [1996] 66 IR 182 at 184; Shop Distributive and Allied Employees’ Association v Woolworths SA Pty Ltd [2011] FCAFC 67 at [16]; WorkPac at [197]. (3)The interpretation turns upon the language of the particular agreement, understood in the light of its industrial context and purpose, citing Amcor Ltd v Construction, Forestry, Mining and Energy Union [2005] HCA 10; 222 CLR 241 at [2].(4)Context is not confined to the words of the instrument surrounding the expression to be construed. It 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 ideas that gave rise to an expression in a document from which it has been taken, citing City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union at [53]; Short v FW Hercus Pty Ltd (1993) 40 FCR 511 at 518; Australian Municipal, Administrative, Clerical and Services Union v Treasurer (Cth) (1998) 82 FCR 175 at 178.(5)Recourse may be had to the history of a particular clause, citing Short at 518.(6)A generous construction is preferred over a strictly literal approach, but the instrument should make sense according to the basic conventions of the English language, citing Geo A Bond and Co Ltd (in liq) v McKenzie [1929] AR 499 at 503-4; City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union at [57], City of Wanneroo v Holmes at 380.(7)Words are not to be interpreted in a vacuum divorced from industrial realities but in the light of the customs and working conditions of the particular industry, citing City of Wanneroo v Holmes at 378-9; WorkPac at [197].

Ratio Decidendi

Legal Principle Established

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