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

[2013] FWC 3286

[2013] FWC 3286

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
Simplot Australia Pty Ltd
(C2012/5292)

COMMISSIONER GREGORY MELBOURNE, 19 AUGUST 2013

Rosters and classifications.

Introduction

[1] This matter concerns an application by the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) (the Applicant) to deal with a dispute in accordance with s.739 of the Fair Work Act 2009 (Cth) (the Act). The Respondent is Simplot Australia Pty Ltd (the Respondent) and the matter concerns employees at its Ulverstone site in Tasmania. The parties are covered by the AMWU and Simplot Australia Pty Limited National Collective Agreement 2011-2014 1 (the Agreement), which applies at five sites operated by the Respondent, including the site at Ulverstone.

[2] The dispute derives from two different instances in which the Applicant submits maintenance employees at Ulverstone have been engaged contrary to the terms of the Agreement. The first concerns a claim that maintenance employees have been engaged at a classification level that is not provided for in the Agreement for employees at the Ulverstone site. The second matter concerns a claim that two employees, normally engaged on a day shift roster, have been engaged for a period of time outside of their ordinary hours of work without appropriate overtime rates being paid. Mr T. McCauley from the AMWU appeared on behalf of the Applicant. Mr D. McLaughlin of M & K Lawyers was granted leave to appear on behalf of the Respondent, pursuant to s.596(2)(a) of the Act, on the basis that the issues in dispute involved a degree of complexity and his involvement could assist the Commission to deal with them more effectively.

The Issues to be Decided

Issue 1

[3] Separate classification scales and wage rates are contained in the Agreement for each of the five Simplot sites. They are set out in Appendix 5 of the Agreement. Different wage rates apply in each case and there are some differences as well in the various classification scales that apply at each of the different locations to which the Agreement applies.

[4] The classification scales and associated wage rates for both the food production and maintenance and engineering employees at the Ulverstone site are set out in Appendix 5 2 as follows:

[5] The Applicant submits that during the life of the current Agreement, and for a period of time prior to that, at least two employees at the Ulverstone plant were engaged at a C12 classification level and one employee continues to be engaged on that basis, being paid an hourly rate of $24.9087. However, it submits as a consequence of the site based classification and wage structure contained in Appendix 5, set out above, maintenance and engineering employees at the Ulverstone site cannot be employed at the C12 classification level. Accordingly, the employees should be reclassified and back paid for any loss incurred as a result of being wrongly classified.

[6] The Respondent has a different view. It points to the “Maintenance Personnel Classification Matrix” 3 contained at page 89 of the Agreement, which contains a C12 classification. It also refers to the “Site Competency Based Classification Structure – Food”4 in the Agreement containing additional classification levels over and above those set out in Appendix 5 for food employees engaged at Ulverstone. In its submission those additional classifications “remains available for use at the Ulverstone site.”5

[7] Therefore, in the first instance the issue to be determined is whether the Agreement intends that the site specific classification and wage structures set out in Appendix 5 define and limit the classifications at which employees can be engaged in at each site or, as the Respondent contends, can they also extend to include other classification levels derived from the classification structures set out in Appendix 6.

Issue 2

[8] Maintenance and engineering employees at the Ulverstone site who normally work day shift were rostered for a short period in February/March 2012 to work from 3:00pm until 11:30pm. They received an afternoon shift penalty during this time. However, the Applicant submits there is no provision in the Agreement for non-continuous shift workers, therefore, the employees should have been paid at overtime rates for performing work outside of their ordinary spread of hours. However, the Respondent contends that clause 25 of the Agreement enables an afternoon shift to be rostered, subject to the relevant provisions contained in the underpinning award. It accordingly falls to the Commission to determine which interpretation of the provisions in the Agreement is correct.

The evidence and submissions

Issue 1

[9] Ms Jennifer Dowell is the National Secretary of the Food and Confectionery Division of the AMWU and has been responsible for the negotiation and drafting of a series of enterprise agreements with the Respondent, including the current Agreement. She said that on each occasion as part of the process to establish the appropriate wage rates and classifications to apply at each site she requested relevant details for each site be provided by the Respondent. The applicable wage increases were then added to those rates and returned to the Respondent for final checking and approval.

[10] She said that over time classification levels which were no longer required at different locations due to changes in technology and work organisation were removed. The C12 classification was removed as part of these processes from the Ulverstone site structure in 2005 on the basis of advice from the Respondent it was no longer required. No proposals were discussed in negotiations for the current agreement about lower classification levels at the Ulverstone site, although a new C5 level classification was added to the structure to reflect recent site based changes. She also indicated that at no time in the negotiations for the current Agreement did the Respondent indicate it intended to apply any classification levels or wage rates, other than those set out in the Agreement. It had, in fact, confirmed that the proposed wage rates and classification structure for the Ulverstone site were “OK”.

[11] Mr John Short is the State Secretary of the AMWU in Tasmania and has responsibilities in this role as an organiser at the Ulverstone site. He said he was told by members at the plant that two employees were being paid at a rate below the minimum rate provided for in the Agreement. He said he raised the issue with management representatives on several occasions and when he asked how the rate for the two employees had been derived was told it was “just constructed”. 6

[12] The Applicant’s submissions acknowledged that any determination made by the Commission could not extend beyond the commencement of the Agreement. However, in its submission the Respondent was not able to place employees in classification levels and associated pay rates that were below the minimum provided for in Appendix 5 of the Agreement. It also pointed to the provisions in clause 11 “Wage and Allowance Increases” of the Agreement which state in conclusion:

“Wages will be in accordance with the wages contained in Appendix 5”. 7

[13] It also placed reliance, in particular, on what it submits is the uncontested evidence of Ms Dowell about the processes gone through to put in place site-specific classifications and wage rates at each one of the five locations covered by the Agreement. In its submission the Respondent has simply failed to do what it agreed to and it was of no consequence whether this was because it had simply overlooked the fact it had employees classified at the C12 level prior to the Agreement being concluded. In its submission no rate below C11 can apply to maintenance and engineering employees at the Ulverstone site.

[14] Ms Donna James is employed by the Respondent as a Human Resources Manager and is based at the Ulverstone site. She confirmed that one employee at the site, Mr Rodney Hingston, has been classified as a C12 since 11 November 1998. She said he had been assessed under the appropriate competency based classification structure and it had been determined, based on the duties undertaken, that he was appropriately classified at that level. She denied saying to Mr Short that she had just constructed the rate and was aware Mr Hingston had been classified at that level for a number of years.

[15] The Respondent also submitted that it is significant that the Maintenance Personnel Classification Matrix on page 89 of the Agreement contains a C12 classification. There are also additional classification levels in the food structure set out at page 88 of the Agreement, which do not appear in Appendix 5 for food production employees at Ulverstone. It accordingly submitted the C12 classification level remains available to be utilised at the Ulverstone site and it highlighted, in particular, the opening sentence from the matrix contained at page 89 which states:

“The following defines the positions required in the Metals classification structure at each production centre.” 8

In its submission it is accordingly intended that Appendix 5 does not operate to the exclusion of the classification structures set out at pages 88 and 89 of the Agreement.

[16] The Respondent also takes issue with the Tribunal’s authority to make one of the draft orders proposed being to:

“pay any affected employee the difference between the minimum C11 rate and any lesser rate paid for any pay period between 9 September 2005 and the making of this determination.” 9

(It should be noted in this context that the Applicant subsequently amended the above date to the date the current Agreement commenced operation on the basis of its acknowledgement that the proposed draft order could not extend beyond the date of operation of the current Agreement.)

[17] In the Respondent’s submission the making of such an order involves an exercise of judicial rather than arbitral power and is therefore beyond the jurisdiction of the Tribunal. It submits any claim for back payment requires the Commission to form a view that the Respondent has not complied with the terms of the Agreement. In its submission this involves determining whether a pre-existing legal obligation has been breached and, if so, what penalty should attach, rather than simply being concerned with the creation and adjustment of rights as part of the Commission’s arbitral functions. It relied, in particular, on the decision of the High Court in Re Ranger Uranium Mines Pty Ltd; Ex parte Federated Miscellaneous Workers' Union of Australia 10 and to the following extracts from that judgement:

“In our view the fact that the Commission is involved in making a determination of matters that could have been made by a court in the course of proceedings instituted under s.119 of the Act does not ipso facto mean that the Commission has usurped judicial power, for the purpose of inquiry and determination is necessarily different depending on whether the task is undertaken by the Commission or by a court. The purpose of the Commission's inquiry is to determine whether rights and obligations should be created. The purpose of a court's inquiry and determination is to decide whether a pre-existing legal obligation has been breached, and if so, what penalty should attach to the breach.

The power of inquiry and determination is a power which properly takes its legal character from the purpose for which it is undertaken. Thus inquiry into and determination of matters in issue is a judicial function if its object is the ascertainment of legal rights and obligations. But if its object is to ascertain what rights and obligations should exist, it is properly characterized as an arbitral function when performed by a body charged with the resolution of disputes by arbitration.” 11

[18] The Respondent also made reference to a Full Bench decision of the former Australian Industrial Relations Commission in Re Smith and Ors 12 when the Full Bench held at para 17:

“When exercising its arbitral function the Commission is concerned with the creation and adjustment of rights, rather than with the declaration and enforcement of existing rights, the latter being functions of a court: Re Ranger Uranium Mines Pty Ltd: Ex parte Federated Miscellaneous Workers Union of Australia.” 13

[19] The Applicant rejects this submission and asserts, in summary:

“ ...that once a private arbitration is authorised by a certified agreement which is made and authorised under the Act then the objections raised by the respondent simply fall away.” 14

In its submission the Ranger decision deals with different arbitral powers than those that now exist under s.739 of the Act, and it was instead considering the general arbitral powers of the former Australian Industrial Relations Commission under the legislation in place at that time.

[20] It submits it is not seeking to have the Tribunal engage in an exercise of judicial power, but instead seeks to have it arbitrate a dispute about the application of certain clauses in the Agreement. In its submission this power was agreed to by the parties, as confirmed by the provisions of clause 46 of the Agreement, and has effect because of the powers of private arbitration sanctioned by that clause in the Agreement. In its submission the orders sought are accordingly not judicial orders that have legal effect independent of clause 46.

[21] The Applicant relied, in particular, on the decision of the High Court in the matter of Construction, Forestry, Mining and Energy Union v Australian Industrial Relations Commission  15 and subsequent decisions of the Commission which have applied that decision. It referred, in particular, to the decision of a Full Bench of the Commission in Telstra Corp Ltd v Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia16, which held in applying the decision of the High Court (references omitted):

“[18] For the most part it is unnecessary to refer to cases decided prior to what has been described as the Private Arbitration Case. That decision dealt with a number of issues relating to dispute settlement provisions in certified agreements involving jurisdictional and other questions which had arisen from time to time and upon which there were a number of apparently inconsistent decisions. Decisions of the Commission, including Full Bench decisions, made before the Private Arbitration Case are to be treated with some caution.

[19] The critical passage in the Private Arbitration Case, for the present purpose, is the following:

‘30. There is, however, a significant difference between agreed and arbitrated dispute settlement procedures. As already indicated, the Commission cannot, by arbitrated award, require the parties to submit to binding procedures for the determination of legal rights and liabilities under an award because Ch III of the Constitution commits power to make determinations of that kind exclusively to the courts. However, different considerations apply if the parties have agreed to submit disputes as to their legal rights and liabilities for resolution by a particular person or body and to accept the decision of that person as binding on them.

31. Where parties agree to submit their differences for decision by a third party, the decision maker does not exercise judicial power, but a power of private arbitration. Of its nature, judicial power is a power that is exercised independently of the consent of the person against whom the proceedings are brought and results in a judgment or order that is binding of its own force. In the case of private arbitration, however, the arbitrator's powers depend on the agreement of the parties, usually embodied in a contract, and the arbitrator's award is not binding of its own force. Rather, its effect, if any, depends on the law which operates with respect to it.

32. To the extent that s 170MH of the IR Act operates in conjunction with an agreed dispute resolution procedure to authorise the Commission to make decisions as to the legal rights and liabilities of the parties to the Agreement, it merely authorises the Commission to exercise a power of private arbitration. And procedures for the resolution of disputes over the application of an agreement made by parties to an industrial situation to prevent that situation from developing into an industrial dispute are clearly procedures for maintaining that agreement. Parliament may legislate to authorise the Commission to participate in procedures of that kind. Accordingly, s 170MH of the IR Act is valid.’”  17

[22] In the Applicant’s submission the parties in the present matter agreed on the terms of clause 46 and it has wide scope in terms of what is to be part of the process of dispute resolution. It also made reference to the decision in Re Australian Services Union (Qantas Airways Limited) Enterprise Agreement VI  18  (Qantas Flight Catering), where the Full Bench stated:

“[30] It seems to us that in light of the High Court's observations the distinction drawn in Qantas v ASU no longer applies. The quoted extract from the High Court's judgment clearly envisages that a dispute settlement procedure may `authorise the Commission to make decisions as to the legal rights and liabilities of the parties to the Agreement'. In so doing the Commission is not exercising judicial power but a power of private arbitration.

[31] A dispute over the application of an agreement will almost always involve the suggestion that one party is failing to comply with the terms of the agreement but that does not prevent the Commission from settling the dispute. The adoption of the appellant's submissions would emasculate the Commission's power to settle disputes over the application of an agreement.” 19

[23] In its submission what is sought is an exercise of arbitration pursuant to s.739 of the Act concerning a dispute arising from a collective agreement made under the Act. As determined in Qantas Flight Catering this will require “the Commission to make decisions as to the legal rights and liabilities of the parties to the Agreement'” 20, and these will be enforceable as a term of the Agreement as authorised by clause 46.

Issue 2

[24] The Applicant submits the Respondent has not complied with the terms of the Agreement when it engaged two day shift workers to work for a short period of time outside of their ordinary hours of work without appropriate overtime penalties being paid. In its submission this is in breach of the provisions contained in clauses 25 and 26 and Appendix 4 of the Agreement.

[25] Mr John Short also gave evidence about this issue. He indicated he was aware that employees had been asked during February and March 2012 to work what was described as an afternoon shift between the hours of 3:00pm and 10:30pm. He understood these employees were normally engaged on a day shift commencing at 7:00am. He also said that an afternoon shift is not normally worked by maintenance employees at the Ulverstone site and the Agreement only provides for day work and what are described as “continuous shift workers” pursuant to Appendix 4 of the Agreement. He said that notice is required to be provided before an employee, in any circumstances, can be required to transfer between day and a continuous shift operation. He also said the particular provisions that applied to the Ulverstone site could be contrasted with the provisions applying at other Simplot sites, which did make specific provision for three shift operations.

[26] Mr Short said he had not been approached by anyone at the Ulverstone site about the introduction of an afternoon shift. He also indicated in cross-examination that Appendix 4 did not provide for a specific afternoon shift and, accordingly, it could not be rostered at the Ulverstone site.

[27] In the Applicant’s submission the question to be determined is whether this work was overtime, or could be considered to be an afternoon shift. In its submission there is no provision in the Agreement for non-continuous shift workers at the site, so an afternoon shift could not be rostered. It submitted the Agreement instead provided, pursuant to clause 36.2, for overtime to be paid to employees asked to work outside of their ordinary spread of hours. In its submission the hours worked by the employees during the limited period of time in February and March were a temporary arrangement designed to deal with a backlog in maintenance at the site. It could not be construed as a genuine afternoon shift arrangement, even if the Agreement enabled such a shift arrangement to be rostered at the Ulverstone site.

[28] The Applicant also made reference to the decision of a Full Bench of Fair Work Australia in Cape Australia Holdings Pty Ltd T/A Total Corrosion Control Pty Ltd v Construction, Forestry, Mining and Energy Union 21 (Cape Australia Holdings) in support of its submission about the principles that should apply to the interpretation of enterprise agreements. These submissions were made in respect of both of the matters at issue. The Full Bench stated, in particular, in that matter (references omitted):

“[7] As to the general approach to the construction of enterprise agreements the observations of French J, as he then was, in City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union (Wanneroo) are apposite:

“[53] The construction of an award, like that of a statute, begins with a consideration of the ordinary meaning of its words. As with the task of statutory construction regard must be paid to the context and purpose of the provision or expression being construed. Context may appear from the text of the instrument taken as a whole, its arrangement and the place in it of the provision under construction. It is not confined to the words of the relevant Act or instrument surrounding the expression to be construed. It may extend to ‘...the entire document of which it is a part or to other documents with which there is an association’. It may also include ‘....ideas that gave rise to an expression in a document from which it has been taken’ - Short v FW Hercus Pty Ltd (1993) 40 FCR 511 at 518 (Burchett J); Australian Municipal, Clerical and Services union v Treasurer of the Commonwealth of Australia (1998) 80 IR 345 (Marshall J).”

[8] While his Honour’s observations were made in the context of interpreting an award the same principles apply to the interpretation of enterprise agreements. For example, similar observations were made by their Honours Gummow, Hayne and Heydon JJ in Amcor v CFMEU:

“Clause 55.1.1 must be read in context. It is necessary, therefore, to have regard not only to the text of cl 55.1.1, but also to a number of other matters: first, the other provisions made by cl 55; secondly, the text and operation of the Agreement both as a whole and by reference to other particular provisions made by it; and, thirdly, the legislative background against which the Agreement was made and in which it was to operate.”

[9] The fact that the instrument being construed is an enterprise agreement is itself an important contextual consideration. As French J observed in Wanneroo, at paragraph [57]:

“It is of course necessary, in the construction of an award, to remember, as a contextual consideration, that it is an award under consideration. Its words must not be interpreted in a vacuum divorced from industrial realities - City of Wanneroo v Holmes (1989) 30 IR 362 at 378-379 and cases there cited. There is a long tradition of generous construction over a strictly literal approach where industrial awards are concerned - see eg GeoA Bond and Co. Ltd (in liq) v McKenzie [1929] AR (NSW) 498 at 503-504 (Street J). It may be that this means no more than that courts and tribunals will not make too much of infelicitous expression in the drafting of an award nor be astute to discern absurdity or illogicality or apparent inconsistencies. But while fractured and illogical prose may be met by a generous and liberal approach to construction, I repeat what I said in City of Wanneroo v Holmes (at 380):

“Awards, whether made by consent or otherwise, should make sense according to the basic conventions of the English language. They bind the parties on pain of pecuniary penalties.” 22

[29] Ms Donna James is the Respondent’s Human Resources Manager in Tasmania and based at the Ulverstone site. She said the employees in question were not actually rostered on the basis of a 12 hour roster but did work an 8 hour roster for a period of 3 weeks in total in February/March 2012. In cross-examination Ms James said the changed hours during this limited period had been discussed with the employees involved, but had not been discussed with the Union because it was not considered to be a significant change. She also said that overtime payments were paid to one employee on the basis that he had not been provided with the requisite 48 hours notice of the proposed changes to his working arrangements.

[30] The Respondent does not dispute that two maintenance employees were temporarily transferred to work an afternoon shift for a total of 3 weeks in February and March 2012, however, in its submission Appendix 4 was not relevant to the determination of the matter because it dealt with 12 hour continuous shifts and the consequential arrangements associated with such rosters. The current situation did not involve the introduction of a 12 hour continuous shift operation. In its submission the hours of work provisions in clause 25 of the Agreement were instead relevant and, in the case of the maintenance employees, sub clause 25.3 in particular, had application. It states:

“25.3 Ordinary Hours and Shiftwork provisions – All other employees

Ordinary hours, weekend and shiftwork provisions for all other employees are provided for in the relevant Award. In addition to the Award provisions, Clauses 25.2(c)(ii) and 25.2(c)(iii) also applies to all other shiftworkers..” 23

[31] In the Respondent’s submission it accordingly requires reference to clauses 36 and 37 of the incorporated Award. It pointed to sub clauses 36.4 and 36.5, in particular, in this context. Clause 37(1)(a) also provided the mechanism whereby an employee could move from day to afternoon shift. Sub clause 37.3 also provides a mechanism to protect against short-term attempts to avoid complying with relevant overtime obligations. It also acknowledged that the relevant notice was not provided to one employee and that employee was, as Ms James’ evidence indicated, paid penalty payments until the 48 hour notice period expired. In its submission there was nothing in the Award or the Agreement provisions which prevented the employees from being rostered and paid in the way they were.

Consideration

[32] There is no dispute between the parties as to the approach to be taken to interpreting an Agreement and the relevant authorities in this regard are well known and well established. The Applicant referred to the Full Bench decision in Cape Australia Holdings, which in turn refers to the decision of French J in City of Wanneroo v Holmes 24, where His Honour observed that in interpreting industrial instruments the starting point should be a consideration of the natural and ordinary meaning of the words used. I have followed the approach of these authorities in considering the provisions of the Agreement that are relevant to both of the issues in dispute in this matter.

Issue 1

[33] Clause 11 “Wage and Allowance Increases” sets out the wage increases to be applied during the life of the Agreement. It concludes by indicating:

“Wages will be paid in accordance with the wages contained in Appendix 5.” 25

[34] Clause 6 indicates that the scope of the Agreement extends to apply at five different Simplot locations namely Bathurst, Kelso, Devonport, Ulverstone and East Devonport. It also states in sub clause 6.2.(c) that it covers:

“The employees of the Company who are engaged to work in the classifications covered by this Agreement and who are either members of a Union or eligible to be members of a Union.” 26

[35] Clause 9 “Site Specific Provisions” also states in part at sub clause 9.2 (a):

“The parties agree that a provision in a site-specific Appendix as appended to this Agreement shall override a provision of any relevant Awards or this Agreement only to the extent of any inconsistency.” 27

[36] The Agreement then contains a number of appendices detailing specific provisions that apply only at individual sites. Appendix 5 “Site Wages and Allowances” then sets out separate classification scales and associated wage rates for each of the 5 sites, including Ulverstone, for both food production employees and maintenance and engineering employees. The various scales and wage rates are each similar in a number of respects, but also contain a number of differences as well.

[37] Appendix 6 follows. It is specifically referred to in clause 18 “Classification Structure” in the following terms:

“The national classification structure is contained in Appendix 6.” 28

[38] Sub clause 18.2 continues to indicate:

“The parties covered by this Agreement have agreed that the new classification framework for food employees, with additional pay points, will be implemented from March 1, 2012.” 29

[39] Appendix 6 itself is entitled “Operations Training Framework” and the preamble at the beginning of the Appendix headed “Background” continues to indicate:

“The following document outlines the guiding policies and principles for Operations Training initiatives at all Simplot Australia Pty Ltd plants for all our Award personnel. It provides a framework for the implementation of a competency based classification structure for Metal Trades and Food Processing Operators. It incorporates nationally recognised and accredited competencies of the Metal and Engineering industry and other qualifications, including the Certificate in Food Processing.” 30

[40] I am satisfied the various provisions referred to in the Agreement and the attached appendices that are relevant to the determination of this issue have a plain and ordinary meaning and should be interpreted in that way. I am, firstly, satisfied with reference to clauses 9 and 11 and Appendix 5 that it is intended that different classification scales and rates of pay are to apply at each of the five sites covered by the Agreement, and I can see no ambiguity in the meaning and intent of those provisions. It is difficult to understand why those different site based classification scales and wage rates have been established if this were not to be the case. I am also satisfied the specific nature of those classification scales and wage rates for each location means it is not intended employees be engaged or employed at classification levels or rates of pay different from those specified in Appendix 5, and it is certainly not intended they be engaged on rates of pay or classifications less than those provided for at each site.

[41] The Respondent points to Appendix 6 and the Competency Based Classification Structure for food production employees and the Maintenance Personnel Classification Matrix, which both contain additional classifications over and above those provided for at each site in Appendix 5. It submits employees can also be classified and engaged at these additional classification levels. However, Appendix 6 is concerned with the establishment of a Competency Based Classification Structures at each site, rather than with the actual classification scale and the pay rates that are to apply at the particular sites at any point in time. I am not satisfied, based on the plain and ordinary meaning of the relevant provisions that I have referred to, that the provisions in Appendix 6 can be in interpreted as intending to act to override the specific words and intent of clause 11 and Appendix 5, in particular. It is also noted, as indicated earlier, that sub clause 9.2(a) states:

“The parties agree that a provision in a site-specific Appendix as appended to this Agreement shall override a provision of any relevant Awards or this Agreement only to the extent of any inconsistency.” 31

[42] This is not to say that a C12 classification could not exist at the Ulverstone site if agreed to by the parties. The evidence of Ms Dowell, in particular, indicated how the classification structures at each site were derived as part of the establishment of the current Agreement. As the Respondent indicated the Maintenance Personnel Classification Matrix in Appendix 6 clearly foreshadows the possibility of a C12 classification applying at a particular site. It may also be the case that the C12 classification was not provided for or considered necessary at the Ulverstone site because those involved in the Agreement negotiations were not aware any employees were still engaged at the site at that classification level, although the evidence of Ms James appears to indicate local management were aware this was the case.

[43] I am also satisfied that it is not necessarily relevant the employees concerned may have been performing work appropriately classified at the C12 level. As indicated, the words in the Agreement have a plain and ordinary meaning and should be construed in that way. Accordingly, the minimum classification levels and wage rates to apply at each of the 5 sites covered by the Agreement are those set out in Appendix 5.

[44] Having come to this decision. I am satisfied it is appropriate to issue the following Orders:

1. In accordance with the relevant classification scale and associated wage rates for maintenance and engineering employees at the Ulverstone site set out in appendix 5 of the AMWU and Simplot Australia Pty Limited National Collective Agreement 2011-2014 the minimum classification level that such employees can be engaged and paid at is the C11 classification.

2. Any employee classified below the C11 level at the Ulverstone site during the life of the current Agreement should be reclassified to at least the C11 classification level with effect from 8 September 2011, being the date from which the Agreement commenced operation. Any consequential wage adjustments following from that reclassification should be provided to any employee(s) reclassified as a consequence of these Orders.

[45] In making these Orders I am mindful of the submissions made by the Respondent about the scope of the Commission’s powers. However, I have also had regard to the decision of the High Court in the matter of Construction, Forestry, Mining and Energy Union v Australian Industrial Relations Commission 32, which has already been referred to in some detail. It confirms that different considerations apply in circumstances where the parties have agreed to submit disputes as to the legal rights and liabilities under an Agreement for resolution by a person or body, and to accept any subsequent outcome from that person or body as binding. In this context the High Court indicated in its decision:

“Where parties agree to submit their differences for decision by a third party, the decision maker does not exercise judicial power, but a power of private arbitration. Of its nature, judicial power is a power that is exercised independently of the consent of the person against whom the proceedings are brought and results in a judgment or order that is binding of its own force. In the case of private arbitration, however, the arbitrator's powers depend on the agreement of the parties, usually embodied in a contract, and the arbitrator's award is not binding of its own force. Rather, its effect, if any, depends on the law which operates with respect to it.” 33

[46] The dispute resolution procedure in the current Agreement is contained in clause 46. It is broad in its scope and states in sub clause 46.1 that it extends to:

“Issues in dispute regarding the application of this Agreement; matters pertaining between the employee and the Company; and matters pertaining between the Union(s) covered by this Agreement and the Company will be resolved between the party or parties and the nominated representatives (which for employee(s) can include a nominated union delegate or official), in accordance with the following procedures:” 34

[47] The clause continues to set out the procedures for dealing with both site-specific and national disputes and in both cases provides for referral to the Commission, if otherwise unresolved in the workplace, for resolution by conciliation and/or arbitration. I am accordingly satisfied that I am able to make the Orders set out in this decision pursuant both to clause 46 of the Agreement and s.739(4) of the Act, being part of a statutory scheme that requires an enterprise agreement must include a term that enables the Commission or another person independent of the parties to settle disputes about any matters arising under that agreement. In doing so I am simply carrying out a function as a private arbitrator, appointed by the consent of the parties, in the matter provided for under the Act. This is not to say that I am capable of making a decision that is inconsistent with the Act, or the agreement that covers the parties. However, I am satisfied it does enable the exercise of the power of private arbitration in a manner that is not open to the objection that it represents an invalid attempt to exercise judicial power. I am accordingly satisfied in this context that the Commission has the power to make the orders set out in this decision

Issue 2

[48] Hours of work are dealt with in clause 25 of the Agreement. It indicates in the opening paragraph:

“In accordance with this clause, the company will develop rosters for the deployment of its employees, after consulting with its employees and taking into consideration the preference of the individual employees and the needs of the business. This clause must be read with the relevant provisions of appendices 1 to 4.

Except as otherwise provided for in this agreement, an employee roster may be altered by mutual consent at any time or by amendment of the roster on 5 days notice.” 35

The clause then continues to provide in sub clause 25.2 “Special Provisions for Food Shiftworkers”. Appendix 4 also contained site-specific provisions for employees at the Ulverstone site. These make reference to shift operations, but deal only with the conditions that would apply in conjunction with the introduction of a continuous shift operation.

[49] Clause 25.3 “Ordinary Hours and Shiftwork Provisions – All Other Employees” is also of relevance. It provides:

“Ordinary hours, weekend and shiftwork provisions for all other employees are provided for in the relevant Award. In addition to the Award provisions, Clauses 25.2(c)(ii) and 25.2(c)(iii) also applies to all other shiftworkers..” 36

[50] I am again satisfied the relevant provisions in the Agreement have a plain and ordinary meaning and should be interpreted and applied in that way. They provide shiftwork conditions for food production employees. They also provided in Appendix 4 provisions that apply for both food production and maintenance and engineering employees if continuous shift operations are to be introduced. Sub clause 25.3 then sets out what is to apply if other shiftwork arrangements are to be implemented and this provides for reference to the “relevant Award.” I am accordingly satisfied that the Respondent is not precluded from rostering employees in the way that it did for a brief period in February/March 2012, or that such work can only be performed in conjunction with overtime rates because it represents work performed outside of the ordinary spread of hours.

[51] Clause 25.3 provides the means whereby shiftwork can be performed by employees other than food production employees or continuous shift workers. In terms of the employees in question in the present matter those conditions would derive from the provisions of the relevant Award being the Manufacturing and Associated Industries and Occupations Award 2010 and sub clauses 25.2(c)(ii) and (iii) of the Agreement. I am accordingly not satisfied that the two employees have been engaged during these periods in February/March 2012 in a manner contrary to the terms of the Agreement and the incorporated Award. However, it follows from this decision that the Respondent should have applied the appropriate Award provisions and entitlements to the two employees involved during the relevant period. Nothing was put in the proceedings to suggest this was not the case.

COMMISSIONER

Appearances:

Mr T McCauley from the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) appeared on behalf of the Applicant.

Mr D McLaughlin of M & K Lawyers was granted leave to appear on behalf of the Respondent.

Hearing details:

2013.

Launceston:

15-16 April.

2013.

Melbourne/Sydney:

7 May.

 1   AE887944.

 2   Ibid at Appendix 5.

 3   Ibid at Appendix 6; pg.89.

 4   Ibid at page 87.

 5   Respondent’s Outline of Submissions at para 15.

 6   Exhibit AMWU2 at para 9.

 7   AE887944 at cl.11.

 8   Ibid at Appendix 6; pg.89.

 9   Applicant’s Outline of Submissions at para 34.

 10 [1987] HCA 63.

 11   Ibid at [24] - [25].

 12   Print PR940508.

 13 Ibid at [17].

 14   Transcript at PN496.

 15 (2001) 203 CLR 645.

 16 [2003] AIRC 1432; PR940569.

 17   Ibid at [18] - [19].

 18   Print PR939695, 22 October 2003.

 19   Ibid at [30]-[31].

 20 Ibid at [30].

 21   [2012] FWAFB 3994.

 22   Ibid at paragraphs [7] - [9].

 23   AE887944 at Clause 25.3.

 24 (1989) 30 IR 362.

 25   AE887944 at Clause 11.1.

 26   Ibid at Clause 6.2(c).

 27   Ibid at Clause 9.2(a).

 28   Ibid at Clause 18.1.

 29   Ibid at Clause 18.2.

 30   Ibid at Appendix 6.

 31   AE887944 at Clause 9.2(a).

 32 (2001) 203 CLR 645.

 33 Ibid at [31].

 34   AE887944 at Clause 46.1.

 35   Ibid at Clause 25.

 36   Ibid at Clause 25.3.

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