“Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers' Union (AMWU) v BAM Clough Contracting Pty Ltd
[2015] FWC 182
•9 JANUARY 2015
| [2015] FWC 182 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.739—Dispute resolution
“Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU)
v
BAM Clough Contracting Pty Ltd
(C2014/6153)
DEPUTY PRESIDENT GOSTENCNIK | MELBOURNE, 9 JANUARY 2015 |
Application to deal with a dispute under agreement; whether employee entitled to living away from home allowance.
Introduction and relevant background
[1] Garry Grieshaber is employed by BAM Clough Contracting Pty Ltd (BAM Clough) in the BAM Clough Ichthys Project Onshore LNG Facilities (Project) team located in Darwin in the Northern Territory.1 Mr Grieshaber is employed as a welder on the Project and commenced that employment on 24 April 2014.2 Mr Grieshaber’s employment on the Project was as a fly in fly out worker.3
[2] The BAM Clough Contracting Pty Ltd Ichthys Onshore Construction Greenfields Agreement (Agreement) applies to Mr Grieshaber’s employment on the Project. The Agreement also covers, relevantly, the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (AMWU) of which Mr Grieshaber is a member.
[3] Pursuant to the fly in fly out nature of Mr Grieshaber’s employment, BAM Clough provided Mr Grieshaber with accommodation at the Howard Springs Accommodation Village.4 This was consistent with one of the requirements of the Agreement to provide non-local employees with accommodation in the Project-provided village.5
[4] Shortly after commencing employment on the Project Mr Grieshaber raised the possibility of obtaining a living away from home allowance (LAFHA) instead of village accommodation with Superintendent Joe Soloman.6 The circumstances in which a LAFHA is paid to an employee are set out in clause 10 of the Agreement.
[5] According to Mr Grieshaber, Mr Soloman told him that it should not be a problem but that he would need to wait until the expiration of the 3 months probationary period and would need to fill in a form for LAFHA.7 Mr Soloman was not called to give evidence but the fact that a conversation between Mr Grieshaber and Mr Soloman about a LAFHA took place was not in dispute, and for the reasons which will shortly become apparent it is unnecessary for me to determine the precise content of the conversation.
[6] Subsequently, Mr Grieshaber was given “forms” by his supervisor, Nick Durea, to complete in order to progress Mr Grieshaber’s application of a LAFHA, which, according to Mr Grieshaber, he completed and returned to Mr Durea.8
[7] The only form in evidence relating to the LAFHA application is one titled “BAM Clough HR Query Form – Trades and Labour” dated 30 May 2014.9 In that form Mr Grieshaber states that “I would like to apply for living away from home allowance LAHA”.10 Mr Durea was not called to give evidence however for the reasons which will shortly become apparent it is unnecessary for me to determine the number of “forms” completed by Mr Grieshaber that were given to Mr Durea by Mr Grieshaber, or the content of the forms.
[8] Subsequently, and according to Mr Grieshaber, relying on his conversation with Mr Soloman, Mr Grieshaber relocated with his partner to Darwin.11 On 10 May 2014 Mr Grieshaber completed an application for tenancy with a Darwin based real estate agent.12 He thereafter entered a residential tenancy agreement for a period of 26 weeks commencing 27 May 2014.13
[9] In or about June or July 2014 Mr Durea advised Mr Grieshaber that his application for a LAFHA had not been approved.14 There after the AMWU made representations on Mr Grieshaber’s behalf during which it maintained that Mr Grieshaber both qualified for and was entitled to a LAFHA in accordance with clause 10 of the Agreement.15 Discussions between BAM Clough, the AMWU and Mr Grieshaber followed, during which the parties could not resolve the dispute concerning Mr Grieshaber’s entitlement to a LAFHA.16 It is not in dispute that the steps taken by the parties to resolve the dispute constituted compliance with the dispute resolution provisions of the Agreement17 and I accept that this is so.
[10] Pursuant to section 739 of the Fair Work Act 2009 (Act), the AMWU made application to the Fair Work Commission (Commission) on 2 September 2014 for the Commission to deal with a dispute in accordance with the dispute settlement procedure under the Agreement. Conciliation before the Commission did not resolve the dispute and ultimately the dispute was allocated to me to determine by arbitration.
Issue in dispute
[11] The sole issue in dispute is whether Mr Grieshaber has an entitlement under the terms of the Agreement to a LAFHA.
[12] Despite the wider terms to the application, the AMWU does not maintain that Mr Grieshaber has any entitlement by reason of any representation said to have been made to him by any employee of BAM Clough or any other person. 18 It is for this reason that I have found it unnecessary to resolve factual controversy about Mr Grieshaber’s conversations with Mr Soloman or about the number and content of any “forms” completed by Mr Grieshaber and returned by him to Mr Durea.
[13] The resolution of the dispute therefore turns on the proper construction of clause 10 of the Agreement.
[14] The competing constructions may be simply stated. The AMWU maintains that once an employee meets the qualification criteria for a LAFHA in clause 10.1(b) of the Agreement then the employee, as of right, is entitled to be paid the LAFHA. No discretion is involved and BAM Clough does not have the right to choose whether to grant a LAFHA to a qualifying employee. As Mr Grieshaber met qualifying criteria in clause 10.1(b) and has done so since 27 May 2014, he is and has been since that date, entitled to a LAFHA pursuant to clause 10.1(a)(2) of the Agreement.
Principles of construction of an enterprise agreement
[15] The principles applicable to the construction of an enterprise agreement have been recently canvassed at length in Australasian Meat Industry Employees Union v Golden Cockerel Pty Limited 19 and it is not necessary to repeat here. I apply those principles to the construction of the Agreement required to resolve this dispute.
[16] Mr Terry Bradley, the Assistant State Secretary of the AMWU Queensland and Northern Territory Branch, gave evidence of that which might be described as the surrounding circumstances20. Mr Bradley’s evidence was that no discussion about the substance of the Agreement occurred between the AMWU and BAM Clough before the Agreement was made.21 BAM Clough accepted that this was correct.22
[17] Mr Bradley’s evidence was also that the Agreement is in substance based on a principal agreement for the Project negotiated between the AMWU (and other unions) and the CCIWA (as it was then).23 According to Mr Bradley, during negotiations for the principal agreement, LAFHA was discussed in the context of an opportunity for employees to relocate in the local community and that there was no discussion about the LAFHA provision being discretionary or subject to agreement with the employer.24 The AMWU submitted that this evidence establishes that the parties did not agree that LAFHA under the Agreement is discretionary.25 I doubt Mr Bradley’s evidence goes that far. His evidence was simply that there “was no discussion about relocation or provision of LAFHA being discretionary or subject to agreement with the Employer”26 and that the issue was not raised in the negotiations with BAM Clough.27
[18] Although I note Mr Bradley’s evidence that “This [discretionary nature of LAFHA] was not raised in negotiations and is not what the Parties agreed”28, the last assertion is not objective evidence of any common intention. It is merely evidence of the subjective intention or expectation of the AMWU. It does not assist in resolving the construction of the disputed provisions of the Agreement. Nor does that evidence assist in establishing an objective framework of facts, which might otherwise assist in resolving the proper construction of the Agreement. The Parties agreed to the words set out in clause 10 of the Agreement. The provisions of clause need to be construed by reference to the ordinary or usual meaning of the words of the provision having regard to the context and purpose of the provision. Appropriate regard may be had to evidence of surrounding circumstance to identify and to resolve any ambiguity but not so as to contradict the plain language of the provision at issue. Mr Bradley’s evidence does not assist in identifying any ambiguity, nor is it probative of any objectively ascertainable surrounding circumstances, to which regard might be had.
[19] I turn then to the words of the provisions as issue.
Relevant provisions and proper construction
[20] LAFHA is provided for in clause 10 of the Agreement as follows:
10.1 Living Away From Home Provisions
(a) Subject to the remainder of this clause, Non-Local Employees will be provided with either:
(1) accommodation in the Project-provided village, or if that is unavailable, a motel or hotel style room with meals supplied; or
(2) a Living Away From Home Allowance (LAFHA) of $580.00 per week.
(b) A Non-Local Employee will only be entitled to receive a LAFHA where:
(1) the Employee mobilises his or her partner and/or family to Darwin with the bona fide intention of his or partner and/or family remaining in Darwin for the duration of the Employee’s time on the Project; and
(2) the Employee provides the Employer with a written declaration that the conditions set out in clause 10.1(b)(1) exist; and
(3) the Employer is satisfied, and remains satisfied throughout the period during which the Employee receives the LAHFA, that the Employee is living with his or her partner and/or family in Darwin in accordance with the details set out in the Employee’s declaration; and
(4) the Employer is satisfied, and remains satisfied throughout the period during which the Employee receives the LAHFA, that the accommodation in which the Employee and his or her partner and/or family are residing, is suitable accommodation.
(c) If the Employer becomes aware at any time that any of the conditions in clause 10.1(b)(1)are not satisfied, the Employer may, after giving the Employee reasonable notice, cease providing LAHFA to the Employee.
(d) While an Employee receives a LAHFA in accordance with this clause:
(1) the Employer will reimburse the Employee upon presentation of receipts, the cost of moving personal effects from their Usual Place of Residence to Darwin and back to their Usual Place of Residence, up to a maximum value of $3,500.00, each way; and
(2) the Employee shall not be entitled to reimbursement for demobilisation of personal effects unless their employment with the Employer has lasted for longer than six months from the date on which the Employee was granted the LAHFA, or for a lesser period, should the work for which the Employee was mobilised be completed in less than six months;
(3) the reimbursement referred to in clause 10.1(d)(1) is paid to the Employee in lieu of entitlements to R&R flights, as the Employee now has their family with them in Darwin; and
(4) the Employee will be deemed to be a Local Employee for the purposes of this Agreement, and therefore will not be entitled to benefits such as R&R travel flights.
10.2 Mobilisation and Demobilisation
(a) The Employer shall transport Non-Local Employees by economy air transport from the High Capacity RPT airport nearest to the Employee’s Usual Place of Residence, to the Project at the commencement of employment and return, at the conclusion of employment. Non-Local Employees shall be allowed a reasonable amount of baggage, (to the maximum allowed in economy air) in addition to any toolbox(s) which the Employer requires the Employee to provide for the Employee’s work on the Project.
(b) Upon mobilisation to the Project, a Non-Local Employee shall be paid eight (8) hours interstate, or four (4) hours intrastate, at the Employee’s Base Hourly Rate. Upon de-mobilisation from the Project, the Employee shall be paid eight (8) hours interstate, or four (4) hours intrastate, at the Employee’s Base Hourly Rate.
10.3 Project closure at Christmas
Where the Employer elects to close down operations on the Project at Christmas, the Employer shall provide Employees with one (1) month’s written notice in advance and shall return Non-Local Employees to the High Capacity RPT airport nearest to the Employee’s Usual Place of Residence.
[21] “Non-Local Employee” is defined in clause 3(c) of the Agreement as an employee whose usual place of residence is outside of the eighty (80) kilometre radius of the project site. “Usual place of residence” is also defined in that clause as the address declared by the employee in their registration of interest form.
[22] There is no dispute that Mr Grieshaber is a non-local employee within the meaning of the Agreement
[23] In aide of its contention, the AMWU submits that the opening words of clause 10.1 (a) “[S]ubject to the remainder of this clause” mean that an employee’s entitlement to a LAFHA under clause 10.1(a)(2) is “dependent or conditional upon” the employee meeting the criteria in clause 10.1(b). It follows, according to the AMWU, that once the criteria for a LAFHA is met, the allowance must be paid and that this is reinforce by the use of the word “entitled” in clause 10.1(b). The use of that word, according to the AMWU, does not accord with the position adopted by BAM Clough that it has discretion whether to pay LAFHA or to provide accommodation.
[24] The construction contended for by the AMWU is in my view incorrect. Clause 10.1 (a) requires BAM Clough to provide a non-local employee with one of two conditions, namely either:
- accommodation in the project provided village all if that is unavailable, a motel or hotel style room with meals supplied; or
- a LAFHA of $580 per week.
[25] The introductory words “[S]ubject to the remainder of this clause” to clause 10.1 (a) whilst meaning “dependent or conditional upon” the remainder of clause 10, do not result in an employee becoming entitled to a LAFHA merely by meeting the conditions set out in clause 10.1 (b). A LAFHA only becomes payable if a non-local employee is not provided with accommodation in accordance with clause 10.1(a)(1). If, as in the case in relation to Mr Grieshaber, BAM Clough provides accommodation under clause 10.1(a)(1), then clause 10.1(a)(2) has no work to do since BAM Clough has complied with its obligation to provide one of the two available conditions it is required to provide to the non-local employee.
[26] If, instead of providing accommodation, BAM Clough wants to pay a LAFHA, it may do so but only to a non-local employee who is “entitled” under clause 10.1(b) “to receive” a LAFHA (an eligible non-local employee).
[27] The words of limitation or condition in clause 10.1 do not operate in the manner suggested by the AMWU. Relevantly, the words operate as a limitation on BAM Clough’s capacity to provide and on an employee to receive a LAFHA instead of accommodation. Thus BAM Clough may only provide a LAFHA under the Agreement instead of accommodation if the non-local employee meets and continues to meet the conditions in clause 10.1(b). The word “entitled” in the context in which it appears does not mean entitled “as of right” as suggested by the AMWU. Read in the context of the provision as a whole, “entitled” means no more than if BAM Clough wants to provide a LAFHA to an employee, it may only do so under the Agreement in respect of an eligible non-local employee. That is, an employee who is entitled to receive it. This is clear from the context as the word “entitled” is immediately followed by the words “to receive”.
[28] That BAM Clough is able to make the election as between provision of accommodation and the payment of a LAFHA to an eligible non-local employee is reinforced by the use of the words “the Employee was granted a LAFHA” in clause 10.1(d)(2). The use of this language is consistent with BAM Clough having the right chose between the provision of accommodation and the payment of a LAFHA, and inconsistent with the construction of clause 10.1(a) contended for by the AMWU.
Conclusion
[29] On a proper construction of clause 10 of the Agreement, BAM Clough may elect to provide eligible non-local employees with accommodation or pay a LAFHA. If, as is the case with Mr Grieshaber, BAM Clough has provided the eligible non-local employee with accommodation in accordance with clause 10.1(a)(1) of the Agreement, there is no entitlement to a LAFHA. It follows that BAM Clough was correct in its decision to refuse Mr Grieshaber’s request for a LAFHA. The dispute is determined accordingly and no orders are necessary.
DEPUTY PRESIDENT
Appearances:
L. Midson for the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU)
J. Lilleyman for BAM Clough Contracting Pty Ltd
Hearing details:
Darwin.
2014
24 November
Final written submissions:
AMWU, 8 December 2014
BAM Clough Contracting, 22 December 2014
1 AMWU 1 at [8] and attachment GG1 thereto
2 Ibid at [9] and attachment GG1 thereto
3 Ibid
4 AMWU 1 attachment GG1 at clause 13
5 BAM Clough Contracting Pty Ltd Ichthys Onshore Construction Greenfields Agreement clause 10.1(a)(1)
6 AMWU 1 at [13]-[14]
7 Ibid at [14]
8 Ibid at [15] and AMWU 2 at [3]
9 Bam Clough 1 attachment LW2
10 Ibid
11 AMWU 1 at [16]
12 AMWU 2 attachment GGA1
13 Ibid
14 AMWU 1 at [18] and BAM Clough 1 at [18]
15 BAM Clough 1 at [20]
16 Ibid at [21]-[29]
17 Clause 18
18 Transcript PN 297 - PN 331
19 [2014] FWCFB 7447 [19]-[41]
20 AMWU 3
21 Ibid at [28]
22 Respondent’s outline of submissions at [8]-[9]
23 AMWU 3 at [26]-[29]
24 Ibid at [16]- [24]
25 Applicant’s submissions at [17]
26 AMWU 3 at [24]
27 Ibid at [25]
28 Ibid
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