[2020] FWC 5920

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
Brockman Engineering Pty Ltd
(C2020/5349)

COMMISSIONER WILSON

MELBOURNE, 17 NOVEMBER 2020

Alleged dispute about any matters arising under the enterprise agreement and the NES; [s186(6)]; redundancy fund payment provision; consideration of obligations for payment to redundancy fund; whether Trust Deed requires consideration.

[1] This decision concerns a dispute over a provision of the BROCKMAN ENGINEERING PTY LTD Workshop & Site Collective Bargaining Agreement 2017 1 (the 2017 Agreement) and what period of time the Respondent is required to make severance contributions to Incolink; where an employee has chosen to have contributions made to that fund, with respect to an employee who is receiving workers compensation payments. The application was made pursuant to s.739 of the Fair Work Act 2009 (the Act) for the Fair Work Commission (the Commission) to deal with a dispute arising under an enterprise agreement.

[2] The Applicant in these proceedings is the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers’ Union (AMWU). The Respondent is Brockman Engineering Pty Ltd (Brockman).

[3] Witness Statements were received from Mr Tony Hynds on behalf of the AMWU and, on behalf of Brockman, Mr Chris Bishop, General Manager.

[4] The application was made by the AMWU on 10 July 2020 and was the subject of conciliation before me on 23 July 2020. After the matter was unresolved and the Commission was advised that the AMWU desired for the dispute to be arbitrated, it was programmed for arbitration, with the hearing listed for 12 and 13 October 2020. The hearing was vacated when the parties consented to the matter being determined on the papers.

QUESTION FOR DETERMINATION

[5] In short form, the dispute concerns a situation in which Brockman is required to make severance contributions to Incolink when an employee is receiving workers compensation payments.

[6] The AMWU submits the question to be determined by the Commission is the following, with Brockman not contesting the characterisation of the dispute:

Q: Where an employee who has nominated Incolink as their severance fund is in receipt of workers compensation benefits, is the Respondent required to make contributions to Incolink on the employee’s behalf for the entire period they receive workers compensation benefits or for a period of 52 weeks only?

[7] I am satisfied the question as submitted properly characterises the dispute and is within the Commission’s jurisdiction to determine. Noting that the Incolink Trust Deed distinguishes between “Approved Workers” and those who are not, the differences between which are discussed later in this decision, the Question for Determination requires being answered differently for the two categories of worker. For the reasons set out below, I have answered the question by determining that Brockman is required to make contributions to Incolink:

(a) for a period of 52 weeks only in the case of an employee receiving workers compensation benefits and who is not an Approved Worker;

and

(b) for the entire period an employee receives workers compensation benefits in the case of an employee who is an Approved Worker.

BACKGROUND

[8] The dispute before the Commission first arose in relation to an employee, Lee Belcher, who was on workers compensation from 2017 until he was terminated by Brockman on 8 July 2020. 2 Under the 2017 Agreement redundancy benefits are provided for within one of two nominated industry specific redundancy schemes, Protect or Incolink.

[9] In Mr Belcher’s case the applicable scheme was Incolink. The 2017 Agreement requires weekly contribution to be made to the applicable scheme, which was $76.35 at the time the 2017 Agreement commenced. Incolink though does not require contributions to be made in relation to an employee absent on workers compensation for greater than 52 weeks if the referenced injury occurred after 30 September 1989.

RELEVANT PRINCIPLES FOR DETERMINATION OF THE DISPUTE

[10] In dealing with a dispute such as this the Commission is not undertaking an exercise of judicial power but is instead exercising a power of private arbitration, with that power deriving from the parties’ agreement to submit their differences for decision by a third party. The resultant arbitrator’s award is not binding of its own force but instead its effect depends on the law which operates with respect to it. 3 It is accepted that while not exercising judicial power, the Commission “may legitimately form and act upon opinions about legal rights and obligations as a step in the exercise of its own functions and powers”.4

[11] The Commission is required to examine whether an enterprise agreement’s dispute settlement procedure “requires or allows” the Commission to deal with the dispute. In order to do so, it is necessary to look at the text of the dispute settlement procedure, understood in light of its industrial context and purpose, to determine whether the dispute, properly characterised, falls within it. 5 The scope of a dispute settlement procedure in an enterprise agreement should not be narrowly construed; “to do so would be contrary to the notion that certified agreements are intended to facilitate the harmonious working relationship of the parties during the operation of the agreement.”6

[12] In characterising the nature of a dispute the Commission is not confined to the application filed to deal with the dispute. 7 The entire factual background is relevant, and may be ascertained from the submissions advanced by the parties on the question of jurisdiction.8 Further, a dispute may evolve during proceedings in the Commission. It may therefore be necessary in some cases when ascertaining the character of a dispute to have regard to both the nature of the dispute alleged in an originating application and the factual circumstances as they evolve.9 The character of the dispute is distinguishable from any relief which may be sought, or granted, following an arbitration of the dispute.10 However, the relief sought may cast light on the true nature of the dispute in some cases.11

[13] The Commission may deal with a dispute only if it is expressly authorised to do so. 12 If the Commission has jurisdiction to deal with the dispute, the nature of the relief that the Commission may grant will depend on the limitation in s.739(5)13 and the agreement of the parties as recorded in their enterprise agreement, provided that such relief is reasonably incidental to the application of the enterprise agreement to which the dispute relates.14

[14] The Full Court summarised the principles for the interpretation of enterprise agreements in Workpac v Skene as follows:

“The starting point for interpretation of an enterprise agreement is the ordinary meaning of the words, read as a whole and in context: City of Wanneroo v Holmes (1989) 30 IR 362 at 378 (French J). The interpretation “… turns on the language of the particular agreement, understood in the light of its industrial context and purpose …”: Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241 at [2] (Gleeson CJ and McHugh J). The words are not to be interpreted in a vacuum divorced from industrial realities (Holmes at 378); 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 (Holmes at 378–9, citing Geo A Bond & Co Ltd (in liq) v McKenzie [1929] AR(NSW) 498 at 503 (Street J)). To similar effect, it has been said that 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: see Kucks v CSR Limited (1996) 66 IR 182 at 184 (Madgwick J); Shop Distributive and Allied Employees’ Association v Woolworths SA Pty Ltd [2011] FCAFC 67 at [16] (Marshall, Tracey and Flick JJ); Amcor at [96] (Kirby J).” 15

[15] From within the Commission, the principles enunciated by the Full Bench in Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union’ known as the Australian Manufacturing Workers Union (AMWU) v Berri Pty Limited 16 (Berri) usefully summarise the approach which should be taken in the task of ascertaining the construction of the words of an enterprise agreement. After an extensive analysis of the subject, the Full Bench summarised the principles to be applied in the following way:

“[114] The principles relevant to the task of construing a single enterprise agreement may be summarised as follows:

1. The construction of an enterprise agreement, like that of a statute or contract, begins with a consideration of the ordinary meaning of the relevant words. The resolution of a disputed construction of an agreement will turn on the language of the agreement having regard to its context and purpose. Context might appear from:

(i) the text of the agreement viewed as a whole;

(ii) the disputed provision’s place and arrangement in the agreement;

(iii) the legislative context under which the agreement was made and in which it operates.

2. The task of interpreting an agreement does 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 parties.

3. The common intention of the parties is sought to be identified objectively, that is by reference to that which a reasonable person would understand by the language the parties have used to express their agreement, without regard to the subjective intentions or expectations of the parties.

4. The fact that the instrument being construed is an enterprise agreement made pursuant to Part 2-4 of the FW Act is itself an important contextual consideration. It may be inferred that such agreements are intended to establish binding obligations.

5. The FW Act does not speak in terms of the ‘parties’ to enterprise agreements made pursuant to Part 2-4 agreements, rather it refers to the persons and organisations who are ‘covered by’ such agreements. Relevantly s.172(2)(a) provides that an employer may make an enterprise agreement ‘with the employees who are employed at the time the agreement is made and who will be covered by the agreement’. Section 182(1) provides that an agreement is ‘made’ if the employees to be covered by the agreement ‘have been asked to approve the agreement and a majority of those employees who cast a valid vote approve the agreement’. This is so because an enterprise agreement is ‘made’ when a majority of the employees asked to approve the agreement cast a valid vote to approve the agreement.

6. Enterprise agreements are not instruments to which the Acts Interpretation Act 1901 (Cth) applies, however the modes of textual analysis developed in the general law may assist in the interpretation of enterprise agreements. An overly technical approach to interpretation should be avoided and consequently some general principles of statutory construction may have less force in the context of construing an enterprise agreement.

7. In construing an enterprise agreement it is first necessary to determine whether an agreement has a plain meaning or it is ambiguous or susceptible of more than one meaning.

8. Regard may be had to evidence of surrounding circumstances to assist in determining whether an ambiguity exists.

9. If the agreement has a plain meaning, evidence of the surrounding circumstances will not be admitted to contradict the plain language of the agreement.

10. If the language of the agreement is ambiguous or susceptible of more than one meaning then evidence of the surrounding circumstance will be admissible to aide the interpretation of the agreement.

11. The admissibility of evidence of the surrounding circumstances is limited to evidence tending to establish objective background facts which were known to both parties which inform and the subject matter of the agreement. Evidence of such objective facts is to be distinguished from evidence of the subjective intentions of the parties, such as statements and actions of the parties which are reflective of their actual intentions and expectations.

12. Evidence of objective background facts will include:

(i) evidence of prior negotiations to the extent that the negotiations tend to establish objective background facts known to all parties and the subject matter of the agreement;

(ii) notorious facts of which knowledge is to be presumed; and

(iii) evidence of matters in common contemplation and constituting a common assumption.

13. The diversity of interests involved in the negotiation and making of enterprise agreements (see point 4 above) warrants the adoption of a cautious approach to the admission and reliance upon the evidence of prior negotiations and the positions advanced during the negotiation process. Evidence as to what the employees covered by the agreement were told (either during the course of the negotiations or pursuant to s.180(5) of the FW Act) may be of more assistance than evidence of the bargaining positions taken by the employer or a bargaining representative during the negotiation of the agreement.

14. Admissible extrinsic material may be used to aid the interpretation of a provision in an enterprise agreement with a disputed meaning, but it cannot be used to disregard or rewrite the provision in order to give effect to an externally derived conception of what the parties’ intention or purpose was.

15. In the industrial context it has been accepted that, in some circumstances, subsequent conduct may be relevant to the interpretation of an industrial instrument. But such post-agreement conduct must be such as to show that there has been a meeting of minds, a consensus. Post-agreement conduct which amounts to little more than the absence of a complaint or common inadvertence is insufficient to establish a common understanding.” 17

[16] The application of these principles, and especially to those in which ambiguity may be considered was further considered by the Full Bench in United Firefighters Union of Australia v Emergency Services Telecommunications Authority:

“[35] As stipulated in Berri, the starting point for interpreting an enterprise agreement is to have regard to the ordinary meaning of the words used. Further, the text must be interpreted in the context of the agreement as a whole. Principles 7 and 10 elicited in Berri emphasise that ambiguity in a provision within an enterprise agreement must be identified before one is to have regard to evidence of the surrounding circumstances. However, principle 8 makes it clear that, in determining whether ambiguity exists, one may have regard to evidence of the surrounding circumstances. That is, such evidence can be used to identify and resolve any ambiguity.” 18

CONSIDERATION

[17] There is a need in consideration of any dispute to properly characterise the dispute before arbitral powers may be exercised, including for the reason the Commission must be satisfied the matter may be dealt with under Part 6 – 2, Division 2 (Dealing with disputes), within which s.739 is found.

[18] Amongst other things, Clause 17.1.1 of the 2017 Agreement sets out a procedure “for the avoidance or resolution of disputes including disputes that may arise in relation to the National Employment Standards”. The Commission’s dealing with such a dispute may be through the means set out in Clause 17.2, and in particular “for conciliation and arbitration”, with the clause itself being in the following terms:

“17.2 Fair Work Commission / Employer Disputes Board

Where the dispute is submitted for arbitration then it shall be submitted to the Fair Work Commission (FWC) for conciliation and arbitration.

The parties shall be bound by the decision of FWC.

The parties agree that FWC, when dealing with a dispute referred to it pursuant to this clause may do any of the things mentioned below:

1. Take evidence on oath or affirmation;

2. Make an order in relation to all or any matters in dispute including an interim order and an order for specific performance of the terms of the agreement;

3. Give a direction, in the course of, or for the purpose of, the hearing or determination of the matter in dispute;

4. Hear and determine the matter in dispute in the absence of a party who has been summoned or served with a notice to appear;

5. Sit at any place;

6. Conduct its proceedings, or any part of its proceedings, in private;

7. Adjourn to any time and place;

8. Refer any matter to an expert and accept the expert's report as evidence;

9. Direct parties to be joined or struck out;

10. All the amendment, on such terms as it considers appropriate, of any application or other document relating to any proceeding;

11. Correct, amend, or waive any error, defect or irregularity, whether in substance or form;

12. Summon before it the parties to the agreement, the witnesses or any other person whose presence the Arbitrator considers would help in the hearing or determination of the matter in dispute and compel the production before it of documents and other things for the hearing and determination of the matter in dispute; and

13. Generally give all direction and do all such things as are necessary or expedient for the speedy and just hearing and determination of the matter in dispute.”

[19] Clause 17.3 purports to provide for consistency of the Commission’s decisions under the Dispute Settlement Procedure with an external Code:

“17.3 Fair Work Commission - Code for the Tendering and Performance of Building Work 2016

Any decision made by the Fair Work Commission must be consistent with the Code for the Tendering and Performance of Building Work 2016”.

[20] Neither party has made submissions about this clause or what it may mean for this arbitration and I am unaware of the content of the Code, or whether this decision is consistent with the Code.

[21] After consideration of these matters and the Question for Determination put forward by the AMWU, I am satisfied that the question addresses a dispute arising under Clause 17 of the 2017 Agreement and that the matter may be arbitrated.

[22] Matters of notice of termination and redundancy pay are dealt within in the Act’s National Employment Standards (NES). 19 A modern award or enterprise agreement must not exclude the NES, however may include terms they are expressly permitted to include either through a provision of Part 2 – 2 or the Regulations.20 A modern award or enterprise agreement may include terms that are ancillary, incidental or supplementary to the NES, but only to the extent the term is not detrimental to an employee in any respect.21 An enterprise agreement may include terms that have the same or substantially the same terms as the provisions of the NES.22 A term of a modern award or enterprise agreement has no effect to the extent that it contravenes s.55.23

[23] Redundancy or severance pay is prescribed in the NES at ss.119 – 122, being Subdivision B of Part 2 – 2, Division 11, with the amount of redundancy pay being prescribed by s.119 equal to “the total amount payable to the employee for the redundancy pay period” worked out in accordance with a table taking into account the “[e]mployee’s period of continuous service with the employer on termination”. The obligation to make a payment of redundancy pay on occasion is subject not only to the ascertainment of whether the employee is actually redundant, but also to the limits on the scope of the Division as set out in Subdivision C, comprised of s.123.

[24] Whether a person is redundant and eligible for redundancy pay is ascertained by the application of the particular facts to the eligibility requirements of s.119(1):

“Entitlement to redundancy pay

(1) An employee is entitled to be paid redundancy pay by the employer if the employee’s employment is terminated:

(a) at the employer’s initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or

(b) because of the insolvency or bankruptcy of the employer.

Note: Sections 121, 122 and 123 describe situations in which the employee does not have this entitlement.”

[25] s.123(4) provides that Subdivision B (Redundancy Pay) does not apply in certain circumstances:

“Other employees not covered by redundancy pay provisions

(4) Subdivision B does not apply to:

(a) an employee who is an apprentice; or

(b) an employee to whom an industry-specific redundancy scheme in a modern award applies; or

(i) the scheme is an industry-specific redundancy scheme that is incorporated by reference (and as in force from time to time) into the enterprise agreement from a modern award that is in operation; and

(ii) the employee is covered by the industry-specific redundancy scheme in the modern award; or

(d) an employee prescribed by the regulations as an employee to whom that Subdivision does not apply.” (underlining added)

[26] It will be seen from s.123(4) that while the circumstances of employees excluded from coverage by redundancy pay provisions include employees covered by industry-specific redundancy schemes, the limit is not unconditional, but rather conditioned by incorporation into the enterprise agreement of a scheme from a modern award that is in operation and in a situation in which the employee is covered by the industry-specific redundancy scheme in the modern award.

[27] The Manufacturing and Associated Industries and Occupations Award 2010 does not provide for an industry-specific redundancy scheme. The Award does contain additional redundancy provisions for certain employees and in certain circumstances but does not characterise such entitlement as either an industry-specific redundancy provision or as supplemental to the NES.

[28] During plain language redrafting of standard redundancy clauses, the award entitlements were treated as industry-specific entitlements supplementing the NES as opposed to an industry-specific redundancy scheme. 24

[29] The 2017 Agreement incorporates into the agreement the terms of the Manufacturing and Associated Industries and Occupations Award 2010, as varied from time to time, however the express terms of the Agreement prevail to the extent of any inconsistency. 25

[30] The Manufacturing and Associated Industries and Occupations Award 2010 provides in relation to severance pay that “[r]edundancy pay is provided for in the NES”. 26

[31] The 2017 Agreement provides for redundancy and severance pay in Clause 11, with Clause 11.1 requiring consultation and the provision of information to directly affected employees before a final decision is taken, and Clause 11.2 requiring redundant employees to be provided with a written statement of service. Clause 11.3 then establishes the requirement for contributions to an industry specific redundancy scheme with the term providing:

“11.3 Redundancy Contributions

a. The company will contribute $76.35 per week into Protect/Incolink. This rate will move in line with the Industry Fund Rate.

b. From the first pay period beginning on or after 1st January 1998, all entitlements to redundancy pay as per Clause 4.4 of the Metal Industry Award 1998 will be preserved. This means that -

c. All accrual will be frozen at 1st January 1998.

d All entitlements will be in accordance with Clause 4.4 of the Metal Industry Award 1998 as at 1st January 1998.

e. Any entitlements will be paid at the appropriate wage rate of this Agreement as at 1stJanuary 1998.

f. The amounts payable in accordance with 11.3a are in substitution for the periods of service applicable under Clause 4.4 of the Metal Industry Award 1998, and there shall be no double counting of service periods which attract the above payments.

g. In the case of apprentices directly employed by the Company the following weekly contributions, paid monthly will be made:

First Year- $35.00

Second Year - $40.00

Third Year- $55.00

Fourth Year- $65.00.

For the avoidance of doubt, no provisions under this clause applies to casual employees other than clause 11.3(a).”

[32] It will be observed from the extracted Clause 11.3 set out above that the 2017 Agreement’s Redundancy Contributions provision makes reference not to the Manufacturing and Associated Industries and Occupations Award 2010, but to the Metal Industry Award 1998, being a predecessor to the former mentioned modern award. The use of that reference is a matter of ambiguity for the construction of the clause, at least in respect of Clause 11.3(f), a matter which is addressed later in this decision. The use of the reference in Clauses 11.3(b) and (d) is likely correct, since those clauses deal with an accrued right at a particular date, namely 1 January 1998.

[33] At a practical level, while the ambiguity is present in Clause 11.3(f) it potentially does not lead anywhere of significance since the Metal Industry Award 1998 severance payments referred to and stipulated within Clause 11.3(f) as being “… in substitution for the periods of service applicable …” with there to “… be no double counting…” are the same as provided for in the NES, being the source of the entitlement set out in the Manufacturing and Associated Industries and Occupations Award 2010 (noting that a different situation would apply for employees of small business employers).

[34] Irrespective of the correct award identity, the plain meaning of Clause 11.3(f) is to ensure there is no “double counting” between an employee’s award derived severance pay rights in the case of redundancy and those they may derive from Protect or Incolink.

[35] The AMWU submitted that the entitlement under Clause 11 is in part to set off Brockman’s obligation to pay severance pay. 27

[36] The requirement for contributions to an external redundancy scheme may be traced back to at least 2000 when the applicable certified agreement provisions were the following:

“12.3 Severance Pay

12.3.1 An amount of $23.25 per week will be paid into Incolink Fund No. 2 for workshop employees.

12.3.2 Payment into Incolink Fund No. 2 for on site only in line with the V.B.I.A standard rate.

12.3.3 From the first pay period beginning on or after 1 January 1998, all entitlements to redundancy pay as per Clause 42 of the Metal Industry Award 1984, Part 1, will be preserved. This means that –

12.3.4 All accrual will be frozen as at 1 January 1998.

12.3.5 All entitlements will be in accordance with Clause 42 of the Metal Industry Award 1984, Part 1, as at 1 January 1998.

12.3.6 Any entitlements will be paid at the appropriate wage rate of this Agreement as at 1 January 1998.

12.3.7 The amounts payable in accordance with (12.3.1) and (12.3.2) are in substitution for periods of service applicable under Clause 42 of the Metal Industry Award, Part 1, and there shall be no double counting of service periods which attract the above payments.”

[37] The general structure of the 2000 Agreement provision carried through successive editions of the enterprise agreement although it is to be noted that the current Clause 11.3(g) dealing with apprentices first appeared in the current 2017 Agreement, as did the specific provision at the end of the whole clause excluding casual employees.

[38] Examination of the currently operating 2017 Agreement’s Clause 11.3 shows a likely layout error, which appears to have been repeated in each successive agreement starting from the 2000 Agreement. The dash “-” at the end of the current Clause 11.3(b) together with the actual wording of Clauses 11.3(c), (d) and (e) likely mean those latter mentioned paragraphs are actually to be treated for construction purposes as subparagraphs of Clause 11.3(b).

[39] The current Clause 11.3 is not well drafted, and neither are the clause’s earlier versions, however on its face the term deals with four discrete, but related matters:

1. Clauses 11.3(a) and (g) establish the obligation of Brockman to contribute on behalf of eligible employees nominated amounts to either Protect or Incolink.

2. Clauses 11.3(b) – (e) deal with the transition point between the usual instrument defined redundancy provisions and the commencement of payments to an external scheme. The clauses appear to be concerned with ensuring that the benefits accrued to the transition date of 1 January 1998 are preserved, do not accrue further, and do not have their value inflate.

3. Clause 11.3(f), being a “no substitution” provision appears to be an endeavour to make plain that the award provisions do not apply when payments are made to an external scheme.

4. The unnumbered last sentence, beginning “[f]or the avoidance of doubt …” ensures that only the contribution prescribed by Clause 11.3(a) applies to casual employees.

[40] Beyond these considerations are several others relevant to the disposition of this matter:

• Clause 11.3 allows for an external body, either Protect or Incolink to increase the contribution rate during the life of the 2017 Agreement, noting that the term used in Clause 11.3(h) “Industry Fund Rate” is not defined anywhere in the agreement.

• The contributions are “in substitution for the periods of service applicable under Clause 4.4 of the Metal Industry Award 1998”.

[41] If the modern award or NES redundancy provisions were applicable to a Brockman redundancy, several matters would require decision, most likely by the employer. Those decisions in turn could possibly be open to dispute either through the modern award dispute resolution term, if that applied, with the term extending to disputes about “a matter under this award, or a dispute in relation to the NES”. 28 A similar situation would arise under the 2017 Agreement’s dispute resolution term, which allows the raising of “disputes including disputes that may arise in relation to the National Employment Standards”.29 The Manufacturing and Associated Industries and Occupations Award 2010 permits disputes to be dealt with by the Commission through mediation, conciliation and consent arbitration.30 The 2017 Agreement gives rights for unresolved disputes to be dealt with by the Commission both by conciliation and arbitration.31

[42] The decisions that would be required if the Award or NES severance pay provisions applied to a Brockman redundancy would include the following, so far as is relevant to a matter such as the one now before the Commission:

• Is this a termination of employment at the initiative of the employer? (s.119(1)(c))

• Is it because the employer no longer requires the job to be done by anyone and not due to the ordinary and customary turnover of labour? (s.119(1)(a))

• What is the employee’s period of continuous service with the employer on termination? (s.119(2))

• As a consequence, what is the redundancy pay? (s.119(2))

• Do any of the exclusions in s.121 apply?

[43] In contrast to this situation, of decisions that would be required to be made by Brockman, and which could be disputed through the aforementioned dispute resolution procedures, there are no severance pay decisions to be made by Brockman under Clause 11.3 once the decision to terminate an employee has been made, although it is of course the case that the provisions of Clauses 11.1 and 11.2 require certain things to be done or decided by Brockman and which may in turn be disputed under the dispute resolution procedure should that be desired by an employee or their representative.

[44] Now before the Commission are copies both of the Incolink and Protect Trust Deeds. The AMWU argued that the Protect Trust Deed makes no reference to workers compensation and that it requires an employer to make contributions in accordance with its enterprise agreement, 32 and argued further that disadvantage could follow a decision by the employer to choose a fund that did not require unlimited contributions:

“If contributions to Incolink while an employee was on worker’s compensation were limited to a period of 52 weeks, a situation would arise where an employee’s entitlement to contributions could be greatly diminished by opting for one fund over the other. If this was an intended outcome of clause 11, it was never explained to the employees who voted on the Agreement.” 33

[45] The Protect Trust Deed’s actual requirement is this, which is not quite as definitive as the proposition that an employer shall make contributions in accordance with its enterprise agreement:

“5 Contributions to the Scheme

5.1 Each Member shall make Contributions to the Scheme in respect of each of the Member’s Workers of such amount, or at such rate and on such basis:

(a) applicable from time to time under, or for the purpose of, an Agreement; or

(b) as may be agreed from time to time between the Member, the Trustee and the Sponsors (whether in relation to the Member’s Workers generally or in relation to any particular category or class of the Member’s Workers).

5.2 All Contributions made by a Member to the Scheme become part of the Trust Fund.”

[46] The Incolink Trust Deed as that document stood at 31 October 2014, is entitled the “Redundancy Payment Approved Worker Entitlement Fund 2”. The copy before the Commission includes four Trustee Determinations. One of those, dated 20 June 2012, deals with the subject of long-term workers compensation absence for “Workers other than Approved Workers”. Before making contributions to Incolink an employer must make an application to do so, including by providing “details of the Workers or Apprentices in respect of whom the application is made”. 34

[47] There are different provisions for “Approved Workers” and those who are not in that category. For the purposes of context, an “Approved Worker” is “each Worker and Apprentice in respect of whom the application for approval was made to and approved by the Trustee”. 35 The AMWU submitted that employers of Approved Workers may “make contributions to Incolink on a basis other than that set out in the Incolink Trust Deed, if such an arrangement is provided for in an enterprise agreement”.36 Both the AMWU and Brockman acknowledged that the applicable redundancy fund is the “Redundancy Payment Approved Worker Entitlement Fund 2”.37 Despite that situation, the material before me does not disclose whether Mr Belcher who commenced this dispute is or is not an Approved Worker.

[48] The Trustees explained when making the 2012 Determination that it was within a particular context, namely:

“5. The Trustee wishes to clarify the position in relation to:

(1) the circumstances where a Worker (other than an Approved Worker) is entitled to make a claim on the Fund under the Deed of Trust; and

(2) the requirement for a Member to make Redundancy Pay Contributions, in circumstances where a Worker is in receipt of payments made to the Worker as required by applicable Workers Compensation legislation ("WorkCover Benefits").”

[49] The Determination made by the Trustees contains two operative parts; the first deals with the benefits to a “Worker (other than an Approved Worker)” whose contract of employment is terminated, and the second deals with the matter of redundancy pay contributions. The first part reinforces the significant discretions to be exercised by the fund and not Brockman on the occasion of an employee’s termination while in receipt of workers compensation benefits:

“(1) WORKERS (OTHER THAN APPROVED WORKERS) IN RECEIPT OF WORKCOVER BENEFITS - CLAIMS THAT MAY BE MADE ON THE FUND

(a) Initial Benefit

When a Worker (other than an Approved Worker) is in receipt of WorkCover Benefits and his/her contract of employment is terminated, the Worker is entitled to request payment of the initial benefit as set out in clause 10.1 of the Deed of Trust.

(b) Remaining Benefit

(i) Whilst a Worker (other than an Approved Worker) is receiving WorkCover Benefits, he/she is not entitled to make a claim on the Fund for the balance remaining in his/her Worker's Account. Once the Worker is no longer in receipt of WorkCover Benefits and his/her employment has been terminated, he/she is entitled to withdraw the balance (if any) of his/her Account if he/she has not worked for four (4) consecutive weeks commencing on the date the Worker ceases to receive WorkCover Benefits. The Worker must provide the Trustee with such evidence as the Trustee may require that the Worker is registered with Centrelink during that period,

(ii) The Worker may be permitted to withdraw the balance (if any) of his or her Worker's Account, at the discretion of the Trustee, if there are extenuating circumstances affecting the Worker. For example - the Trustee may consider exercising its discretion if a Worker (other than an Approved Worker):

(A) has been in receipt of WorkCover Benefits for more than the maximum compensable period under the Workers Compensation legislation applicable to the Worker,

(B) is unlikely to return to work in the foreseeable future or to ever work in the building industry again, and

(C) writes a letter to the Trustee giving reasons for wishing to claim, and provides a letter from his/her doctor confirming the situation.

In such circumstances, provided the Worker's employment has been terminated and the Trustee is satisfied as to the bona fide's of the case, then the remaining benefit could be paid.” (underlining added)

[50] Following is the text of the second part of the 2012 Determination dealing with the matter of redundancy pay contributions:

“(2) WORKERS (OTHER THAN APPROVED WORKERS) IN RECEIPT OF WORKCOVER BENEFITS - REQUIREMENT TO MAKE REDUNDANCY PAY CONTRIBUTIONS

(a) When a Worker (other than an Approved Worker) suffers a workplace injury and is accepted by his/her employer's Workers Compensation insurer as qualifying to receive WorkCover Benefits, his/her employer is required to make the weekly Redundancy Pay Contribution to the Fund for the period that the Worker is in receipt of WorkCover Benefits up to a maximum of:

(i) 26 weeks if the injury occurred prior to and including 30.09.89

(ii) 52 weeks if the injury occurred after 30.09.89

(the Maximum Benefit Period)

(b) The requirement in paragraph 6(2)(a) above will continue to apply for the Maximum Benefit Period even if any of the following occurs:

(i) the Worker's employment is terminated prior to the expiration of 26 or 52 weeks, as is relevant;

(ii) the Worker's employer enters into liquidation or winding up (in which case the total of contributions up to the expiration of 26 or 52 weeks forms part of the employer's debt to the Fund);

(iii) the Employer ceases to trade (in which case the employer would need to make the Redundancy Pay Contributions up to the expiration of 26 or 52 weeks, as is relevant, either at the time the Employer ceases to trade or on a monthly basis after ceasing to trade).

(c) Where a Worker (other than an Approved Worker) is injured whilst working for an Employer that is engaged on a mix of commercial/industrial and domestic work the following will apply:

(i) if the Worker was injured whilst working on a domestic site, no Redundancy Pay Contributions will be payable to the Fund under the Deed of Trust;

(ii) if the Worker was injured whilst working on a commercial/industrial site, Redundancy Pay Contributions will be required to be paid up to the end of the Maximum Benefit Period in accordance with paragraphs 6(2)(a) and 6(2)(b) above.”

[51] The text of the 2012 Determination is clear that it does not apply to someone who is an Approved Worker. Contributions on behalf of Approved Workers are dealt with in Clause 7.7 of the Incolink Trust Deed as follows:

“7. Approved Workers

…

7.7 A Member to which this clause applies must in respect of each Worker and Apprentice in respect of whom the application for approval was made to and approved by the Trustee ("Approved Worker") make Redundancy Pay Contributions to the Trustee of the amount payable under and otherwise in accordance with the terms and conditions of the Industrial Instrument.

…”

[52] An employee does not have to be made redundant in order to access benefits from Incolink. According to its summary literature, Incolink separates monies held for an employee between those payable at the time of an “initial claim” being made and the balance. An initial claim benefit may be made by an eligible worker “when employment ends”, 38 with the balance being payable to a worker if they meet one of four criteria, subject to the provision of defined supporting evidence:

“• They have been unemployed for four weeks and registered with either Incolink Job Support or Centrelink. If registered with Centrelink please provide an official document as proof of registration.

• Have not worked in the industry for 39 weeks; a statutory declaration must be completed and executed.

• Is retiring from active employment and is over 55 years of age; a statutory declaration must be completed and executed.

• Is unemployed and leaving Australia for more than two years (a certified copy of a current passport and copy of itinerary showing non-return flight must be provided as proof); a statutory declaration must be completed and executed.” 39

[53] When an industry specific redundancy scheme such as Incolink applies to Brockman or its employees, Incolink does not so much process decisions made by Brockman as make decisions of its own in accordance with its Trust Deed. In this regard:

• A benefit may be claimed and paid to the worker for termination generally, including if they are “terminated for any reason”, 40 or if they have left the industry, retire or die.

• Discretion is given to the trustees in relation to general termination matters, both in relation to the evidence the trustees require about the employee standing to make a claim in the payment of death benefits.

[54] Incolink is clearly at arms-length as a decision maker from its contributor employers and member employees, and the framework of the Trust Deed and subsequent four amending determinations suggest that such has being the case for a considerable period of time. Such is the case to at least August 2004, the date of the current consolidated Trust Deed, and it may well have been the case back to the date of establishment of the fund on 20 October 1995 41 (noting that the pre-2004 Trust Deed is not before the Commission).

[55] The most recent enterprise agreement, the 2017 Agreement has been made against this background, starting it seems in 2000 and possibly earlier and confirming through successive enterprise agreements an intention to work in accordance with different redundancy provisions to those now provided in the NES.

[56] The import of these arrangements, since they started, is to replace the severance pay arrangements of the applicable award and more pertinently, the Act. Instead of those arrangements applying, the bargain achieved by the parties is for entirely different arrangements to apply, extending well beyond severance pay. Not only do the calculation and payment arrangements differ but so too do matters of eligibility and circumstances of payment, the nature and points at which discretion may be exercised in the fact that the decision-maker is external to the parties and external to the enterprise agreement.

[57] Scrutiny of the Trust Deed shows that it is not just the weekly contribution rate that is subject to movement or decision externally to the enterprise agreement.

[58] Brockman argued that the disputed term came about because of a desire to confirm to employees the generality of the benefits they could access, but not to detail the full term of those benefits:

“8. The respondent puts forward that the intent of the Agreement is to not reproduce the details of how the various schemes referenced in the Agreement operate. The intent is to ensure employees are aware of which schemes apply for the Agreement. To list the details (terms & conditions, benefits, etc.) of the schemes referenced in the Agreement listed following would not be practicable:

a. Protect

b. Incolink

c. Coinvest

d. Wage guard

9. The respondent contends that the intent of clause 11.3(a) is to not detail the terms and conditions of the Incolink scheme, how it operates along with the member benefits available. The respondent contends that the intent of clause 11.3(a) is to confirm the two redundancy schemes available to the employee from which they are able to select which scheme they wish to be covered by.” 42

[59] Brockman also argued that another provision of the 2017 Agreement may prevent it from making payments that departed from what it saw as its obligations to Incolink; to do so would make Brockman not compliant with the scheme:

“Clause 51 of the Agreement requires the company to ensure employees be compliant with industry schemes which includes Incolink. Compliance with clause 51 of the Agreement would require the employer to cease payments in relation to the Incolink scheme for an employee on WorkCover after a 12 month period. …” 43

[60] The 2017 Agreement’s Clause 51 (Industry Fund Compliance), which provides for the following:

“51. INDUSTRY FUND COMPLIANCE

The company shall ensure that all of its employees covered by this Agreement are compliant with industry schemes PROTECT/Incolink, Wageguard, superannuation fund (default fund Cbus) and Co invest.

The Company will not impeded (sic) access to employees by representatives from industry funds for general issues raised by multiple employees. For non-controlled Company sites this access will need to be reviewed on a case by case basis.”

[61] It is necessary to strive for the proper construction of the disputed term by taking into consideration the entirety of the enterprise agreement, as well as the placement of the disputed term itself.

[62] In this regard it must be noted that the 2017 Agreement employs different and more prescriptive language for another benefit which is also administered an arms-length to the parties to the enterprise agreement, namely superannuation. The 2017 Agreement permits superannuation contributions to be made to either Australian Super or C+BUS with the superannuation clause directly addressing the subject of what should occur in the case of a long-term workers compensation absence. In this regard Clause 16.1 of the 2017 Agreement provides the following:

“"Ordinary time earnings"' is as defined in clause 6(b) of the Metal Industry Superannuation Award operating as an Incorporated Term. Where an employee receives workers compensation, income protection payments or make-up payments in respect of time off work then the employer shall contribute superannuation in respect of those payments to a maximum of 52 weeks.”

[63] Similar provisions may be found in the predecessor enterprise agreements as well. Those provisions, as well as their development, are obviously different to the language of Clause 11.3, and especially because of the explicit provision that employer superannuation contributions not be made to employees on long-term workers compensation. However, the cap on contributions is long-standing.

[64] While the definition of “ordinary time earnings” in the 2000 Agreement makes no reference to the present 52-week limitation, another part of the superannuation clause requires contributions to be made in defined circumstances 44 and incorporates provisions of the Metal Industry Superannuation Award as that award stood at 1 January 1998. The incorporated terms include a provision that contributions for an employee in Victoria on long-term workers compensation will be made for “a maximum of 52 weeks total absence for each injury or sickness”, provided the employee is receiving the workers compensation payments in accordance with an industrial instrument dealing with accident pay.45

[65] The 2007 Agreement provided that in the case of an employee receiving “workers compensation, income protection payments or make-up payments in respect of time off work then the employer shall contribute superannuation in respect of those payments to a minimum of 26 weeks” 46. It also incorporated the text of the Metal, Engineering and Associated Industries (Superannuation) Award 2000, which included the following Clause 11.3:

“11.3 Work related injury or illness

In the event of an employee’s absence from work being due to work-related injury or work-related illness, contributions at the normal rate shall continue for the period of the absence (subject to a maximum of 52 weeks total) provided that:

11.3.1 the member of the Fund is receiving workers’ compensation payments or is receiving regular payments directly from the employer in accordance with statutory requirements; and

11.3.2 the person remains an employee of the employer.”

[66] The 2006 Agreement (as varied in 2009) substantially replicated the earlier provision. 47

[67] The 2011 Agreement amended the superannuation contribution limitation for employees on long-term workers compensation absences to 52 weeks:

““ordinary time earnings” is as defined in clause 6(b) of the Metal Industry Superannuation Award operating as an Incorporated Term. Where an employee receives workers compensation, income protection payments or make-up payments in respect of time off work then the employer shall contribute superannuation in respect of those payments to a maximum of 52 weeks.” 48

[68] The 2017 Agreement definition of ordinary time earnings is in the same terms as the 2011 Agreement.

[69] The AMWU contends that for the purposes of ascertainment of the construction of the agreement that the provisions of the Act are “notorious facts of which knowledge is presumed” but that the Incolink Trust Deed may not be viewed in that light. In particular it was submitted that the terms of the Deed were not discussed or known to the AMWU negotiator at the time the 2017 Agreement was negotiated. 49

[70] In relation to the provisions of the Act, the AMWU noted that in respect of the ascertainment of continuous service, relevant to determination of the severance payments to be made to a person at the point of redundancy pursuant to s.119(2) that the definition of “service” in s.22 explicitly stating that service does not include any excluded period. However, an absence on workers compensation is not an ‘excluded period’ within the meaning of s.22. 50

[71] The legislative context under which the disputed provision was made, or at least since the commencement of the Fair Work Act 2009 in 2010, includes the matters set out above about the Act. Whether or not those matters of conformity of the enterprise agreement with the NES and modern award have been properly engaged is not a matter for this decision. The 2017 Agreement has been approved by the Commission and this decision deals with the construction to be given to a term of the agreement.

[72] Brockman and its employees and their representatives appear to have engaged with the legislative context from the perspective that they wanted to provide redundancy fund contributions and other benefits in excess of those which may otherwise be derived only from the NES or a modern award. Whether they were entitled to do so for reason of s.123(4) and the other sections within Part 2 – 2, Division 11 and the provisions of the modern award or actually did so is not the subject of this decision; however it is amply clear that the parties’ objective was to provide redundancy pay arrangements that were different to the NES of the modern award. In the context in which the Commission must be satisfied for approving enterprise agreements that, amongst other requirements, employees are better off overall if the agreement were to be approved, it may be assumed, especially with union bargaining representatives, that the intention of the parties was to establish a scheme under which employees were in fact better off overall when it came to severance pay entitlements. It must be said though that there is no direct evidence before the Commission on these matters.

[73] What stems from these considerations of the context of the severance pay provisions is that they have developed over time but likely without the benefit of detailed consideration of the objective, or how the change may sit relative to other parts of the agreement. The text of the disputed provision when considered against the whole agreement highlights a piecemeal drafting approach not only for the term itself, but other parts as well. The legislative context assists in understanding the parties objective to step outside what are now the NES provisions, as well as to likely do so in a manner which ensures employees are better off overall as a result. Those matters of themselves do not resolve the dispute.

[74] Neither is resolution of the dispute assisted through consideration of the superannuation provisions of the successive editions of the enterprise agreement, or that the Protect Trust Deed is perceived by the AMWU to provide more beneficial benefits to employees if Brockman’s submission about capped contributions for employees on long-term workers compensation is correct.

[75] The superannuation terms, while demonstrably different to the severance pay provisions, have been different since inception. The fact that they have been adjusted at different times, and seemingly in response to different externalities, only serves to reinforce that the severance pay provision has developed for its own reasons. The fact that the superannuation clause definition of ordinary time earnings is explicit about a cap on contributions after 52 weeks workers compensation and that the redundancy fund contribution provision is silent on the subject does not mean the two are connected and that the absence of a cap in the latter provision ordains the construction.

[76] The possible differences between the Incolink and Protect Trust Deeds and the likelihood that one will be more beneficial to an employee in a particular set of circumstances is acknowledged, however again does not define the construction to be afforded the 2017 Agreement’s disputed term. There are insufficient submissions on the subject of the two Deeds for me to be confident that this is the only difference of potential significance; in some respects it would be unremarkable if there were no other differences which had the potential to advantage or disadvantage a person in any given situation. The two are commercial organisations, and it may well be the case they choose to structure their services to attract a particular clientele or not.

[77] Upon first reference the 2017 Agreement appears clear; $76.35 per week will be contributed by Brockman into either Protect of Incolink, with that amount to be periodically adjusted and the contribution is in substitution for the amounts that would otherwise apply.

[78] Despite that clarity though the term is ambiguous. In particular, what is the Industry Fund Rate which ensures movement of the contribution rate of $76.35? What is meant by the reference to the weekly contribution being “in substitution for the periods of service applicable under Clause 4.4 of the Metal Industry Award 1998”? Is that intended to be a signal that the contributions to Protect/Incolink remove any obligation to pay severance pay that would otherwise flow from the incorporated modern award, and is the reference to the Metal Industry Award 1998 accurate, or is it more likely a reference to the currently applicable modern award?

[79] Resolution of these matters, as well as the matter of determination of the proper construction of the disputed clause requires consideration first of the history of the term. The context of the disputed provision is of a rather brief clause dealing with the subject of severance pay in a manner which has obviously been built up over successive editions of the enterprise agreement since 2000. The original 2000 version has been amended on a handful of occasions but not through comprehensive redrafting; instead the amendments have been through the addition of a sentence or two at the conclusion of each bargaining period.

[80] There is no evidence before the Commission as to why these particular amendments were made or what problems they were endeavouring to address although obviously some insight can be derived from the amendments themselves. The term in the 2017 Agreement is different from that in the 2000 Agreement, but not substantially or overwhelmingly so:

• The layout of the 2000 Agreement is the same as that now applying, replete with the “-” and the probable layout error referred to above. The term also made reference to Clause 42 of the Metal Industry Award 1984, Part 1. The first parts of the term drew a distinction between “workshop” and “on site” employees.

• The term in the 2007 Agreement set out a program for increasing contribution rates, initially from 65% of the “Industry rate” and progressively upwards to 100% and removed the reference to “on site” employees but maintained the award cross-reference.

• The 2006 Agreement (as varied in 2009) for the first time stipulated that the initial contribution rate would “move in line with the Industry Fund Rate” and was otherwise consistent with the former provisions.

• The 2011 Agreement is substantially in the same form as the earlier provision, but with an increased initial contribution rate. 51

• The 2017 Agreement maintained the earlier drafting, including the adjustment of contributions in accordance with the Industry Fund Rate, and introduced a schedule of contribution rates for apprentices as well as including a stipulation that only the contribution rate provision would apply to casual employees. The award cross-reference was amended to Clause 4.4 of the Metal Industry Award 1998.

[81] As previously observed, it has been said both that “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” with it the case that “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”. 52

[82] The ambiguities of the disputed term, referred to above, are only meaningfully addressed if it is accepted that the parties, through their bargain, wanted to step outside of the severance pay arrangements set out in the Manufacturing and Associated Industries and Occupations Award 2010, under which they would otherwise be covered, with the award also incorporated into the 2017 Agreement.

[83] In this case, the progression of the disputed clause from its inception has been against the clear backdrop of a desire to provide severance pay and other benefits, initially to onsite workers, which are different to and better than the generally applicable award based or legislative standard. At least since 2004 and no doubt earlier, enlivenment of that objective required two things; Brockman had to apply to become a contributor to the relevant fund and it had to then provide the fund with details of the employees who would be covered by the arrangement. The process of application required disclosure of information to the fund, as well as the formation of legal relations between all concerned; the fund, the employer and the employee. Literature from Incolink, and before the Commission, makes clear that the fund administers a range of complex matters for and on behalf of all parties, but principally the employee.

[84] It could not be reasonably expected in such a context that the parties intended their arrangements associated with the redundancy fund contributions would be entirely governed by the 2017 Agreement. To the contrary, the complexity of the issues in question and the discretions to be exercised by the fund administrators compel the conclusion that common intention of the enterprise agreement parties was to select a fund and then be bound by the rules, etc that were set by the fund.

[85] In relation to the other matter of ambiguity, given that the Manufacturing and Associated Industries and Occupations Award 2010 is incorporated and that those of its terms which are not the subject of inconsistency with the 2017 Agreement continue to apply, it is reasonable to accept that the reference to the Metal Industry Award 1998 in Clause 11.3(f) is actually a reference to the Manufacturing and Associated Industries and Occupations Award 2010. Clause 11.3(f) deals with the situation in which payments under Clause 11.3(a) have been made, evincing the clear intention that with the payments having been made “there shall be no double counting of service periods” which attract those payments. That is a forward-looking clause, dealing with continuous service after the date on which redundancy fund contributions commenced. The absolving of liability that would otherwise arise which is given by Clause 11.3(f) is plainly the liability that initially stems from the NES and continues through the current modern award (but acknowledging there is at least a question as to whether the exemption given by s.123(4)(c) is available).

[86] Against this backdrop, of an ambiguous term, development of the term over a 17 year period, and a highly prescriptive set of fund administrative arrangements it follows that the negotiating parties intended as a matter of common contemplation and common assumption that matters of severance pay funding, administration and payment would be undertaken through and consistent with the rules, determinations and decisions of Incolink. There is nothing within the parties’ arrangements that would lead to the conclusion that they would tell Incolink, through their enterprise agreement, how severance pay should be funded, administered or paid.

[87] Since at least 2012 it has been clear that one of Incolink’s determinations has been that contributions are required only up to a maximum of 52 weeks in the case of an employee on long-term workers compensation absence and who was not an Approved Worker. The limitation to someone who is not an Approved Worker arises because the 2012 Determination applies only to a “a Worker (other than an Approved Worker)” and does not apply to Approved Workers. The contributions to be made on behalf of an Approved Worker are regulated by Clause 7.7 of the Incolink Trust Deed which requires contributions “of the amount payable under and otherwise in accordance with the terms and conditions of the Industrial Instrument”. The 2017 Agreement, which commenced on 11 January 2018 was made after the Incolink Determination, made by the Trustees on 20 June 2012 and has status as an “industrial instrument”. 53

[88] The likelihood that the parties’ common intention was to establish a requirement through the enterprise agreement for redundancy fund contributions arrangements to be derived from and managed by the Incolink fund, ensuring employees were better off overall than if the award based or NES arrangements applied leads to the conclusion there is no requirement under the 2017 Agreement for Brockman to make contributions for a period of greater than 52 weeks in the case of an employee on long-term workers compensation and who is not an Approved Worker.

[89] The contributions for and on behalf of an Approved Worker are to be made in accordance with the 2017 Agreement. With there being no contrary term anywhere in the 2017 Agreement on the subject the contribution rates set out in Clause 11.3(a) must be applied for every week of employment for an adult, as must the contribution rates set out in Clause 11.3(g) for apprentices. The provisions respectively provide that for adult employees “[t]he company will contribute $76.35 per week into Protect/Incolink” (Clause 11.3(a)) and for apprentices “the following weekly contributions, paid monthly” (Clause 11.3(g)). Nothing within the 2017 Agreement or the Incolink Trust Deed would allow a finding that the payments per week, or the weekly contribution, paid monthly, are to cease in certain situations. The ordinary meaning of the words within those clauses does not allow a finding that contributions should cease after 52 weeks of long-term workers compensation absence. Such stands in distinction to someone who is not an Approved Worker.

[90] Accordingly, the question for determination should be resolved with the answer that Brockman is required to make contributions to Incolink for a period of 52 weeks only in the case of an employee receiving workers compensation benefits and who is not an Approved Worker, and that contributions for Approved Workers must be made for the entire period an employee receives workers compensation benefits.

CONCLUSION

[91] For the reasons set out above, the Question for Determination to be addressed in this decision is answered in the following manner:

A: The Respondent is required to make contributions to Incolink

(a) for a period of 52 weeks only in the case of an employee receiving workers compensation benefits and who is not an Approved Worker;

and

(b) for the entire period an employee receives workers compensation benefits in the case of an employee who is an Approved Worker.

[92] The dispute is determined accordingly.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

1 AE426800.

2 Witness Statement of Chris Bishop, 17 September 2020, [8].

3 Construction, Forestry, Mining and Energy Union v The Australian Industrial Relations Commission [2001] HCA 16; (2001) 203 CLR 645 [30] – [32]; cited in Endeavour Energy v Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia [2016] FCAFC 82 at [25].

4 Construction, Forestry, Mining and Energy Union v Wagstaff Piling Pty Ltd [2012] FCAFC 87 [21], cited in Kentz (Australia) Pty Ltd v Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia[2016] FWCFB 2019 [52].

5 CEPU v Thiess Pty Ltd (2011) 212 IR 327 at [42], [47]; CFMEU v AIRC [2001] HCA 16.

6 SDA v Big W Discount Department Stores PR924554 at [23].

7 AMWU v Holden Limited PR940366 at [47]; MUA v ASP Shipping Management Pty Ltd[2015] FWC 4523 at [23].

8 Ibid [47].

9 MUA v ASP Shipping Management Pty Ltd[2015] FWC 4523 at [19], [23]; R v Bain; Ex parte Cadbury Schweppes Australia Ltd (1984) 159 163 at 168; United Firefighters’ Union v Metropolitan Fire and Emergency Services Board PR973884.

10 MUA v Australian Plant Services Pty Ltd PR908236; MUA v ASP Shipping Management Pty Ltd[2015] FWC 4523 at [21] - [22].

11 United Firefighters’ Union v Metropolitan Fire and Emergency Services Board PR973884 at [20].

12 Fair Work Act 2009, s.595.

13 The Commission must not make a decision that is inconsistent with the Fair Work Act 2009, or a fair work instrument that applies to the parties.

14 MUA v Australian Plant Services Pty Ltd PR908236 at [63]; Seven Network (Operations) Ltd v CPSU (2003) 122 IR 97 at [31] - [32].

15 [2018] FCAFC 131, [197], (2018) 280 IR 191, [197].

16 [2017] FWCFB 3005.

17 Ibid, [114].

18 [2017] FWCFB 4537.

19 Fair Work Act 2009, Part 2 – 2, Division 11.

20 Ibid, ss.55(1) – (2).

21 Ibid, s.55(4).

22 Ibid, s.55(5).

23 Ibid, s.56.

24 [2018] FWCFB 7447, [27].

25 BROCKMAN ENGINEERING PTY LTD Workshop & Site Collective Bargaining Agreement 2017, AE426800, cl. 5.1 – 5.2.

26 Manufacturing and Associated Industries and Occupations Award 2010, Print MA000010, cl. 45.1 (noting that different provisions apply in relation to a “small furnishing employer”).

27 Applicant’s Outline of Submissions, 4 September 2020, [17].

28 Manufacturing and Associated Industries and Occupations Award 2010, Print MA000010, cl. 42.1.

29 BROCKMAN ENGINEERING PTY LTD Workshop & Site Collective Bargaining Agreement 2017, AE426800, cl.17.1.1.

30 Manufacturing and Associated Industries and Occupations Award 2010, Print MA000010, cl.42.3.

31 BROCKMAN ENGINEERING PTY LTD Workshop & Site Collective Bargaining Agreement 2017, AE426800, cl.17.2.

32 Applicant’s Outline of Submissions, 4 September 2020, [26].

33 Ibid, [27].

34 Incolink Trust Deed, filed 4 September 2020, cl. 7.3(3).

35 Ibid, cl. 7.7.

36 Applicant’s Outline of Submissions, 4 September 2020, [25].

37 Applicant’s Outline of Submissions, 4 September 2020, [4]; Respondent’s Outline of Submissions, 17 September 2020, [5].

38 Incolink Services Handbook, filed 17 September 2020, p.9.

39 Ibid, p.10.

40 Incolink Trust Deed, filed 4 September 2020, cl.10.

41 Ibid, p.1.

42 Respondent’s Outline of Submissions, 17 September 2020.

43 Ibid, [10].

44 E BROCKMAN & SON PTY LTD WORKSHOP AND SITE COLLECTIVE BARGAINING AGREEMENT 2000, AG781063, cl.18.1.2, 18.2.5 and 18.2.6.

45 Metal Industry (Superannuation) Award 1989, Print M0309, cl.11(c).

46 BROCKMAN ENGINEERING PTY LTD WORKSHOP & SITE UNION COLLECTIVE AGREEMENT 2007, AW789529, cl.17.1.1.

47 BROCKMAN ENGINEERING PTY LTD Workshop & Site Collective Bargaining Agreement 2006, AE883004, cl.11.3.

48 BROCKMAN ENGINEERING PTY LTD WORKSHOP & SITE COLLECTIVE BARGAINING AGREEMENT 2011, AE891995, cl.17.1.1 and 17.2.5.

49 Applicant’s Outline of Submissions, 4 September 2020, [22].

50 See WorkPac Pty Ltd v M Bambach[2012] FWAFB 3206, [67].

51 BROCKMAN ENGINEERING PTY LID Workshop & Site Collective Bargaining Agreement 2011, AE891995, cl.11.3(a).

52 Workpac v Skene [2018] FCAFC 131, [197], (2018) 280 IR 191, [197].

53 The Incolink Trust Deed provides that “"Industrial Instrument" has the same meaning as in the Act” (cl.1.1(30)) and that “"Act" means Fringe Benefits Tax Assessment Act 1986” (cl.1.1(2)). The Fringe Benefits Tax Assessment Act 1986 prescribes that “"industrial instrument" means a law of the Commonwealth or of a State or Territory or an award, order, determination or industrial agreement in force under any such law” (s.136)(1).

“Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers' Union (AMWU) v Brockman Engineering Pty Ltd

[2020] FWC 5920

17 NOVEMBER 2020

DECISION

RELEVANT PRINCIPLES FOR DETERMINATION OF THE DISPUTE