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

[2013] FWC 9055

[2013] FWC 9055 [Note: An appeal pursuant to s.604 (C2013/6195) was lodged against this decision - refer to Full Bench decision dated 27 March 2014 [[2014] FWCFB 1629] for result of appeal.]

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
RACV Road Service Pty Ltd
(C2013/5606)

COMMISSIONER RYAN MELBOURNE, 21 NOVEMBER 2013

Alleged dispute concerning alteration to roster system and classification structure.

[1] The matter in dispute in the present matter is the intended use of clause 13.6(b) of the RACV Metropolitan Patrol Services Enterprise Agreement 2011 - 2014 (the current Agreement) by the RACV to alter the existing agreed start and finish times of rosters of Patrol Servicepersons. The AMWU contends that the RACV cannot rely upon clause 13.6(b) to change the start and finish times of the agreed rosters as to do so would contravene the operation of clause 42.5(c) of the Agreement.

Background

[2] The variation of rosters for Patrol Servicepersons has been a contentious issue for many years, with the RACV wanting to alter the rosters and with the AMWU and employees resisting any change.

[3] Collective agreements made under the relevant legislation have been a feature of the IR landscape between the RACV and its Patrol Servicepersons for many years. These agreements include:

Royal Automobile Club of Victoria (RACV) Ltd Certified Agreement 1994 (the 1994 Agreement);

RACV Patrols Certified Agreement 1996 (the 1996 Agreement);

RACV Metropolitan Patrols Certified Agreement 1998 (the 1998 Agreement);

RACV Metropolitan Patrol Service Certified Agreement 2000 (the 2000 Agreement);

RACV Metropolitan Patrol Services Certified Agreement 2003-2006 (the 2003 Agreement);

RACV Metropolitan Patrol Services Certified Agreement 2006-2009 (the 2006 Agreement);

RACV Metropolitan Patrol Services Certified Agreement 2009-2011 (the 2009 Agreement); and

RACV Metropolitan Patrol Services Enterprise Agreement 2011 - 2014(the current Agreement).

[4] The current Agreement contains the following two clauses with the relevant provisions of each clause highlighted:

“13. WORKPLACE FLEXIBILITY

13.1 Guidelines for the achievement of maximum workplace capacity and utilisation shall be as prescribed in this clause.

13.2 There shall be co-operation between management and employees in improving member and customer satisfaction, productivity and flexibility. The parties also agree to cooperate to achieve the principles and initiatives identified in the RACV Corporate Plan, and the Member Services and Automotive Services business plans. This cooperation is aimed at ensuring the ongoing viability of the business. The implementation of any initiatives identified in the business plans referred to above will be in accordance with all the requirements of this agreement. This includes a requirement that RACV notifies and discusses with the Patrols and their representatives any major change that is likely to have a significant effect on employees (refer clause 14 – Introduction of Change).

13.3 Mixed Functions

Employees may be directed during any day to perform different functions within their skill, competence and training, provided that such direction is not designed to promote deskilling.

In the case of an emergency and/or during a period of peak workload, any member of RACV staff may be directed to work in any RACV work location or position. Such support may be utilised until trained staff are available to perform the work.

Any direction issued by RACV pursuant to this sub-clause shall be consistent with RACV’s responsibilities to provide a safe and healthy working environment.

When an employee is required to perform duties for a period of at least one day which attract a higher rate than the employee’s substantive position, the employee shall be paid at that higher rate for that period. Provided that, where an employee is required to perform duties which attract a lower rate of pay on a short-term or temporary basis, there shall be no adjustment to the employee’s salary including allowances.

13.4 Meal Period Flexibility

Clause 43 - Meals provides for flexibility in the timing of meal periods, enabling variation without notice, by consent, or when necessary, to facilitate continuous operation.

13.5 Movement of employees

Employees may be moved to temporarily replace other employees in order to maintain continuous operation. This may include the movement into RACV of staff to assist with operations where unusual circumstances or high demand require it.

13.6 Alteration of Hours of Work and Shifts

(a) Where appropriate, procedures enabling continuous operation during shift changeovers will be implemented.

(b) The time of commencing and finishing hours of work may be changed by seven days’ notice of the alteration given by RACV to employees.

(c) The ordinary hours of work which have been determined by RACV, shall not be altered, except in the case of an emergency without the giving of one week’s notice of such alteration.

13.7 Starting Times

Starting and finishing times of individual employees within a workplace may be staggered to ensure maximum capacity utilisation.

42. HOURS OF EMPLOYMENT

42.1 Ordinary Hours

The ordinary hours of employment shall be an average of 38 per week based on a roster mutually agreed upon provided that such hours shall not exceed:

42.1(a) Eight (8) in any one day, or

42.1(b) Fifty-six (56) in any seven consecutive days, or

42.1(c) One hundred and four (104) in any fourteen consecutive days, or

42.1(d) One hundred and sixty-eight (168) in any twenty-eight consecutive days.

42.1(e) Any other work cycle as agreed.

Such ordinary hours shall be worked continuously except for meal breaks at the discretion of RACV. Except at regular change-over of shifts, an employee shall not be required to work more than one shift in each 24 hours.

42.2 Reduction in working hours

A 38 hour week shall be worked. The method is to be as follows:

42.2(a) Except as provided in sub-clauses 42.2(d) and 42.2(e) hereof, the method may be any one of the following:

(i) work shorter hours each day; or

(ii) work shorter hours on say one day each week; or

(iii) fix a day on which all employees will be off during a particular work cycle.

42.2(b) An assessment should be made as to which method best suits the business and the proposal shall be discussed with the employees concerned, the objective being to reach agreement on the method to be worked.

42.2(c) In the absence of agreement at plant level, the procedure for resolving special, anomalous or extraordinary problems shall be applied. The procedure shall be applied without delay.

42.2(d) In cases where the employer and the majority of employees concerned agree, ordinary hours may be more than eight on particular days of a work cycle, thus enabling a day off to be taken more frequently than would otherwise apply.

42.2(e) Circumstances may arise where different methods of implementation apply to various groups of employees in the establishment concerned.

Different methods of implementation may apply to various individuals or groups of employees.

42.3 Spread of Hours

Not more than twelve shifts are to be worked in any fourteen consecutive days inclusive of Sundays and holidays and the principle of a five day week is to be adhered to as far as is possible without reducing the efficiency of the service.

42.4 Rosters

42.4(a) Each patrol shall have access to the continuous roster showing their projected rostered days of work.

42.4(b) When leave is to be taken Patrol Officers on afternoon shift will change roster as follows:

(i) The second last shift will commence at 1.00 pm

(ii) The last day of the shift will commence at 9.00 am.

This procedure will allow for employees to be available to complete vehicle return and administration functions during daytime hours for patrol officers and also allow the required break between shifts.

42.4(c) On occasions when patrol officers are required to leave the company vehicle at an RACV premises, for annual leave or other reasons, the company will provide the most efficient method of transport home either by Cabcharge or RACV provided transport. Patrol officers may be brought into the RACV Depot one hour before the shift finish time to unload the vehicle and then travel home as described above.

42.4(d) 1400 Shift Meal Break

This allowance will be paid at the rate of the Voluntary Meals in the Field to be increased to $19.50

42.5 Variation by Agreement

42.5(a) The hours of employment as set out in this clause and the spread of hours as set out in sub-clause 42.3 may be varied by mutual consent between RACV and an employee or their representative. Any such agreement must be recorded in writing and may be terminated by either party by the giving of 28 days’ written notice.

42.5(b) A shift shall consist of not more than 10 hours inclusive of crib time. Provided that:

(i) in any arrangement of ordinary working hours where the ordinary working hours are to exceed eight on any shift the arrangement of hours shall be subject to agreement between RACV and the employee or the majority of employees concerned; and

(ii) by agreement between RACV, the employee or the majority of employees concerned (and where relevant, their representative), ordinary hours not exceeding 12 on any day may be worked subject to:

RACV and the employee/s concerned being guided by the occupational health and safety provisions of the ACTU Code of Conduct on 12 Hour Shifts;

proper health and monitoring procedures being introduced;

suitable roster arrangements being made; and

proper supervision being provided.

(iii) In respect to sub-clause 42.5(b), the employee may request their representative to become involved in discussions with RACV. RACV will recognise and accept the right of the representative to be involved in discussions.

42.5(c) Alterations to Roster System

There will be no across the board changes to the Roster System, with consequential changes to start/finish locations, during the life of this Agreement without prior consultation with Patrols, and the agreement of the parties.

There will be no changes to the roster system during the life of this Agreement without prior consultation with Patrols and the agreement of the parties.

42.6 Emergency Provisions

In a case of emergency beyond its control RACV may require an employee to change his/her usual working hours (including the meal break of such period).

42.7 Rest Period Between Rostered Shifts

Except in the case of an emergency, the rostered hours shall be worked so that employees have at least 10 hours off duty between the conclusion of their rostered shift on one day and the commencement of the rostered shift on their next working day.”

The history of current clause 13.6

[5] Clause 13 of the current Agreement was first introduced (in identical form) in the 2000 Agreement where it was numbered as clause 2.2. In the 2009 Agreement a new clause 13.8 was added as follows:

“13.8 Quality Project

The parties to the Agreement commit from the date of approval of this Agreement that they will establish a Quality Project joint working party. The joint working party will attend bi-monthly meetings conducted in good faith by both parties. It is anticipated that after five meetings, the joint working party will be in a position to draft a report to the General Manager, Automotive Services outlining progress to date. By the end of the Agreement, the joint working party should have completed the Quality Project and it will be implemented following full consultation with the parties.

[6] As can be seen clause 13.8 had a specific limited purpose and clause 13.8 of the 2009 Agreement was not retained in the current Agreement which had clause 13 revert to the wording which had existed prior to the 2009 Agreement.

The history of clause 42

[7] Clause 42 of the current Agreement has many provisions which have remained unchanged since the 1994 Agreement. Hours of Employment was dealt with in clause 42 in the current Agreement, the 2009 Agreement and the 2006 Agreement. The same subject was dealt with in clause 6 in each of the 2003 Agreement, 2000 Agreement and the 1998 Agreement. The subject matter was not specifically mentioned in the 1996 Agreement as that Agreement effectively picked up the provisions of the 1994 Agreement. In the 1994 Agreement the subject matter was dealt with in clause 11. Clauses 42.1, 42.2, 42.3, 42.4(a), (b) and (c), 42.5(a) first sentence, 42.5(b), 42.5(c) first sentence, 42.6 and 42.7 are the same as they were in the 1994 Agreement (save for extremely minor changes in 42.4(a) and also in 42.5(a) and (b) where reference to the AMWU and union have been changed to refer to representative).

[8] The substantive changes which have occurred are detailed below.

[9] The 1996 Agreement included a clause which introduced a new roster. Clause 11 of the 1996 Agreement was as follows:

11 Rosters

A new eight and nine hour shift roster will be introduced. This roster will benefit the RACV and patrols as weekend work will be reduced.

As a consequence of the reduced number of weekend days actually worked, there is a reduction in the actual weekend penalty payments.

The RACV will, through negotiation, seek to improve the structure of the roster so it provides greater benefits to employees in keeping with operational requirements of the business.

[10] Whilst this clauses did not require agreement of employees it is clear from the structure of the 1996 Agreement that it picked up the key provisions of the 1994 Agreement that required that rosters be set by agreement with employees and be varied by agreement of employees.

[11] Clause 42.4(d) in its current form was first included in the 2009 Agreement. In the 2006 Agreement it read as:

“42.4(d) 1400 Shift Meal Break

The 1400 shift meal will at the discretion of the Patrol be taken either in the field with an allowance of $13.90, or at an RACV premises or the Patrol’s home.”

[12] In the 2003 Agreement it read as:

“6.1.4(d) Variation To Start and Finish Times

The starting time for Patrols who work either an 8 or 9-hour roster may have their start times varied:

● on the 8-hour roster, the starting time to be changed from 1200 to 1400 o on the 9-hour roster, the starting time to be changed from 1130 to 1330
● The 1400 shift meal will at the discretion of the Patrol be taken either in the field with an allowance of $13.90, or at an RACV premises or the Patrol’s home.

These times may be varied other than the above by agreement.”

[13] The first sentence of current clause 42.5(c) first appeared in the 2003 Agreement. In the 2009 Agreement two additional paragraphs were added as follows:

“A joint committee of the parties is to be established within two months of the Agreement being certified to review existing roster arrangements that may form part of the negotiations for the next Agreement.

There will be no changes to the roster system during the life of this Agreement without prior consultation with Patrols and the agreement of the parties.”

[14] The first paragraph added in the 2009 Agreement was removed when the current Agreement was made but the second paragraph added in the 2009 Agreement was retained as the second paragraph in the current Agreement.

[15] The importance in mapping this out over 19 years is to show that both clauses have been subject to quite deliberate change over that period of time but that significant parts of the clauses have not been changed.

Consideration of the Issue in Dispute

[16] The evidence of both the applicant and the respondent was that by the time the 2009 Agreement was being negotiated that there was acceptance that the existing agreed roster system was in need of change. The employees accepted the need to consider change and the agreed outcome of the negotiations was to insert two new paragraphs into clause 42.5(c). As is clear from the language of those two paragraphs any change to the then existing roster system would only occur after a joint committee had reviewed the roster system and then only after further agreement of the parties.

[17] The evidence in this matter clearly shows that the start and finish times of shifts was both part of the review undertaken of the then existing roster system and subsequently part of the agreed changes to the roster system.

[18] That the current Agreement retained the third paragraph of clause 42.5(c) of the 2009 Agreement reinforces the notion that change to the roster system was only to occur with the agreement of the parties.

[19] In support of their respective contentions as to the correct approach to interpreting the respective clauses of the current Agreement each of the RACV and AMWU relied on certain authorities.

[20] The RACV relied upon the decision of Emmet FM in NSW Nurses Association v SOS Nursing & Home Care Service Pty Ltd [2011] FMCA 225 and the cases cited therein.

[21] The AMWU relied on the following decisions:

● Codelfa Constructions P/L v SRA of NSW (1982) 149 CLR 337 per Mason J at 351,
● Short v FW Hercus P/L (1993) 40 FCR 511 per Burchett J at 517
● Kucks v CSR Ltd [1996] IRCA 166 per Madgwick J,
● Moshirian v University of New South Wales [2002] FCA 179 per Moore J at 26.

[22] I have had regard to each of these authorities. None of the decisions are conflict with each other rather each adds to the understanding as to the correct approach to interpreting the terms of an enterprise agreement. Clearly the above list of authorities is not exhaustive as there are many other useful decisions that could also be cited and relied on.

[23] Mr Pearce, Manager Metropolitan Road Service for RACV Automotive Services gave evidence that RACV management only came to a concluded view that clause 13.6(b) could be used to change the start and finish times of the various agreed rosters for Patrol Servicepersons some time in 2013. As Mr Pearce said:

“PN740. Mr Vroland: So you first became of the view that you could rely on the clause to make the changes subsequent to receiving advice from the human resources department, is that what your evidence is? ---Mr Pearce: Yes

PN741. In 2013?---Yes”

[24] Additionally Mr Pearce made it clear that he did not hold the same view as to the use of clause 13.6 at the time the 2011 agreement was made nor had anyone else indicated to him that they held that view of clause 13.6.

[25] Mr Pearce also conceded that the effect of clause 13.6 was not explained to employees when the 2011 agreement was made.

[26] The evidence of the Patrol Servicepersons who gave evidence in this matter was that the operation of clause 13.6 which is now adopted by the RACV was never put to them when the 2011 agreement was made. Mr Kraft’s evidence was that, had the RACV explained to him during the making of the 2011 agreement, that clause 13.6(b) could be used by the RACV to change the start and finish times of the rostered shifts as it now plans to do then “they would have heard me screaming and yelling at the union meetings”. 1

[27] It is clear that each of clauses 13.6 and 42.5 have work to do within the overall operation of the enterprise agreement and any interpretation of these clauses must ensure that they do have real work to do.

[28] The interpretation of clause 13.6 urged upon the Commission by the RACV seeks to divorce clause 13.6 from the previous history of the making and operation of collective agreements made between the RACV and its Patrol Servicepersons and in particular the agreed approach to rostering Patrol Servicepersons.

[29] On its face the plain words of clause 13.6 provide the RACV with the right to change the start and finish times of Patrol Servicepersons without the need to consult with the Patrol Servicepersons and without needing to have the agreement of Patrol Servicepersons to any change.

[30] The RACV contends that as long as they don’t change the structure of the roster that they have an unfettered right to change the start and finish times of shifts within the roster. Mr Pearce agreed with a proposition put to him by the Commission that within one of the exiting rosters, Roster 9A, the RACV could move the start time on every day by 9 hours and the roster would still have the employee starting on the same day. Mr Pearce’s only qualification on this application of clause 13.6 to the existing rosters was that whilst it was theoretically possible for the RACV to do this under clause 13.6 the RACV wouldn’t do this as it was not practical to do so.

[31] The evidence for the AMWU was that clause 13.6(b) had work to do but that work was limited.

[32] Mr Turnbull’s evidence was that he couldn’t recall clause 13.6(b) being relied on but that he was “aware that patrols’ start and finish times may have been changed was around public holidays, the Christmas period, it may have been to accommodate patrols when they attended training, they attend a training course I think annually and so a dozen would be taken off the road and they would need to alter rosters to do that I assume, start and finish times.” 2

[33] Mr Kraft gave evidence that he was aware that clause 13.6(b) had been used by the RACV in relation to “Alteration of school days, maybe patrols coming on light duties for Workcover, altering of times.” Mr Kraft also gave an example of RACV using the provision to move him within his roster by moving him to a different week in the roster so that he keeps working the roster cycle but has simply jumped ahead to a different week in the roster cycle. 3

[34] There was no evidence from the RACV that clause 13.6(b) had ever been utilised in the manner which the RACV now contends that it can be used. Mr Pearce’s evidence was that all changes to start and finish times had been done by agreement in the past.

[35] The previous conduct of the parties is relevant to an interpretation of the terms of the current Agreement. In Toll (FGCT) P/L v Alphapharm P/L the High Court said:

“It is not the subjective beliefs or understandings of the parties about their rights and liabilities that govern their contractual relations. What matters is what each party by words and conduct would have led a reasonable person in the position of the other party to believe. References to the common intention of the parties to a contract are to be understood as referring to what a reasonable person would understand by the language in which the parties have expressed their agreement. The meaning of the terms of a contractual document is to be determined by what a reasonable person would have understood them to mean. That, normally, requires consideration not only of the text, but also of the surrounding circumstances known to the parties, and the purpose and object of the transaction.” 4

[36] Earlier authorities on the interpretation of awards and agreements must be applied in light of the statutory framework which exists in relation to making an enterprise agreement under the Fair Work Act. An enterprise agreement is made when a majority of employees who cast a valid vote approve the agreement (s.182). The employer cannot ask the employees to approve the agreement unless the employer has complied with a number of prerequisites including, explaining the terms and the effect of the terms of the agreement to the employees.(s.180) Interpreting the terms of an enterprise agreement can be made easier where the employer has explained a term and the effect of a term of the enterprise agreement to employees before they voted to approve the enterprise agreement. Such an explanation together with the vote of employees to approve the enterprise agreement provides a reasonably strong basis to objectively determine the intentions of the parties in relation to a particular term of the enterprise agreement. Where as in the present case, no specific explanation was given by the RACV to employees as to the term or the effect of the term of clause 13.6(b) of the current Agreement then objectively the intent and meaning of clause 13.6(b) given by both the RACV and employees and the AMWU must be the same as it had prior to the current Agreement.

[37] In the present matter “each party by words and conduct would have led a reasonable person in the position of the other party to believe” that clause 13.6(b) was to be utilised for a very limited range of changes to address personal circumstances of a Patrol Serviceperson and that changes to the start and finish times of the agreed rosters would only occur by agreement pursuant to clause 42.5(c) of the Agreement. Such a conclusion is consistent with the way in which clause 13.6(b) and clause 42 (including its predecessors) had been used by the RACV since clause 13.6(b) was first introduced into the 2000 Agreement as then clause 2.2.6(b).

[38] Expressed slightly differently, it is clear that the RACV by its words and conduct would never have a led a reasonable person in the position of a Patrol Serviceperson or the AMWU to believe that clause 13.6(b) could be used by the RACV to alter the agreed start and finish times within the rosters in the manner proposed by the RACV.

Conclusion

[39] For the purpose of achieving the changes it wants to the start and finish times of rosters the RACV must comply with clause 42.5(c) of the current Agreement.

Additional Observations

[40] The RACV acknowledged that it had not forced its proposed changes on its employees as consistent with the dispute resolution procedure of the agreement the status quo ante was in place until this dispute is resolved.

[41] I note that the current Agreement has past its nominal expiry date and that bargaining for a new enterprise agreement is underway.

[42] Neither the AMWU nor the RACV has sought that orders be made in relation to the matter in dispute.

[43] The decision in this matter will clearly inform the parties in relation to how they continue their bargaining over a new enterprise agreement and it is most appropriate that the parties come to an agreed position through the bargaining process. Whatever is the outcome of bargaining, the relationship between clause 13 and clause 42 needs to be clearly explained to employees as part of the obligation on the employer to explain the terms and the effect of the terms of the agreement to employees before they vote on approving a new enterprise agreement.

[44] Finally, I draw the attention of both parties to s.140 of the Act which can be availed of to assist in any bargaining dispute over this or any other issue.

COMMISSIONER

Appearances:

D. Vroland for the applicant

R. Marasco for the respondent

Hearing details:

2013.

Melbourne:

October 14.

 1   Transcript of proceedings at PN482.

 2   Ibid at PN351.

 3   Ibid at PN457.

 4   Toll (FGCT) P/L v Alphapharm P/L [2004] HCA 52 at [40].

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