"Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU) v TW Power Services
[2016] FWC 6564
•14 SEPTEMBER 2016
| [2016] FWC 6564 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.739 - Application to deal with a dispute
"Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU)
v
TW Power Services
(C2016/1114)
DEPUTY PRESIDENT GOSTENCNIK | MELBOURNE, 14 SEPTEMBER 2016 |
Alleged dispute about any matters arising under the enterprise agreement and the NES;[s186(6)]; existing practice of allowing employees to leave work five minutes early; whether existing practice is an over agreement condition of employment; whether alteration to existing practice is a variation to usual finishing time; whether proposal to cease existing practice is an extra claim; consideration of the proper construction of agreement.
Introduction
[1] TW Power Services Pty Ltd (TW Power) is a party to a contract with AGL Loy Yang Pty Ltd to provide maintenance services and conduct minor outages at the AGL Loy Yang A Power Station and associated mine (Site). TW Power employs a number of employees to perform maintenance work at the Site pursuant to the contract. TW Power and these employees are covered by TW Power Services AGL Loy Yang Power Station Mechanical (AMWU & CFMEU) Enterprise Agreement 2016 (Agreement). The Agreement has only recently been approved. It commenced operation on 28 April 2016 and its nominal expiry date is 31 March 2019. The Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers’ Union (AMWU) and the Construction, Forestry, Mining, and Energy Union (CFMEU) (collectively “the Unions”) are covered by the Agreement.
[2] It is common ground that there is an existing practice of many years standing whereby employees covered by the Agreement whose work time finishes at 3.30pm, leave the Site's crib room (also known as the brew room) and commence walking to the Site's exit gate at approximately 3.25pm. Thereafter, employees pass through the Site's exit gate at approximately 3.30pm. It is also common ground that ordinary hours of work for the employees who participate in the existing practice commence at 7.00am. Pursuant to the Agreement, the ordinary hours of work are 36 per week worked between Monday to Friday each week.
[3] A dispute has arisen about the capacity of TW Power to bring to an end the existing practice and to require the employees affected to remain at work until 3.30pm. By applications lodged on 16 May 2016, the AMWU applied to the Fair Work Commission (Commission) pursuant to s.739 of the Fair Work Act 2009 (Act) for the Commission to deal with a dispute in accordance with the dispute settlement procedure of the Agreement. The CFMEU as an organisation covered by the Agreement appeared at the hearing and adopted the submissions of the AMWU. 1
Questions for determination
[4] There is no dispute that the Commission’s jurisdiction has been properly invoked and that I am able to determine the dispute by arbitration. The parties have agreed that the dispute is to be resolved by determining by arbitration the following questions:
1. Is the existing practice an “over Agreement condition of employment” for the purpose of Clause 5.7 of the Agreement? (It is presumed that if the answer is yes, it will continue to apply).
2. Does the TW Power proposal constitute a variation to “the usual starting time” or “the usual finishing time” for the purposes of Clause 13.2 of the Agreement? (If the answer is yes, it is presumed that variations may not be made except by agreement of the parties to the Agreement).
3. Does the TW Power proposal constitute an "extra claim" for the purposes of Clause 43 of the Agreement?
[5] The resolution of these questions turns ultimately upon the proper construction of various provisions of the Agreement.
[6] The principles applicable to the proper construction of an enterprise agreement are not in dispute and were canvassed at length in Australasian Meat Industry Employees Union v Golden Cockerel Pty Limited. 2
Consideration
Whether the existing practice is an over Agreement condition of employment
[7] Clause 5.7 of the Agreement provides the following:
“Further, existing over Agreement payments and conditions of employment will continue to apply unless varied by this Agreement.”
[8] Self-evidently clause 5.7 operates to preserve existing over agreement payments and existing over agreement “conditions of employment” that apply to employees covered by the Agreement when the Agreement was made or commenced operation, unless those over agreement payments or conditions of employment are varied by the Agreement.
[9] The dispute raises for consideration the meaning of the expression “conditions of employment” used in clause 5.7. The starting point for the consideration of the meaning of that expression is the language of clause 5.7, understood in the light of its industrial context and purpose, bearing in mind that the language of the clause may have been drafted by laypersons without attention to the niceties of form and drafting.
[10] There seems no dispute that the existing practice has operated for a significant period. The practice was in place and was well known to the bargaining parties when the Agreement was made. That a practice was in place historically and was well known is a contextual consideration to the proper construction of the Agreement, but in and of itself, does not have the result of converting that practice into a condition of employment.
[11] The expression “conditions of employment” is used elsewhere in the Agreement. Clause 7.3, for example, provides:
“7.3. The employer must ensure that the individual flexibility arrangement:
(a) is in writing; and
(b) includes the name of the employer and employee; and
(c) is signed by the employer and employee and if the employee is under 18 years of age, signed by a parent or guardian of the employee; and
(d) includes details of:
(i) the terms of the enterprise agreement that will be varied by the arrangement; and
(ii) how the arrangement will vary the effect of the terms; and
(iii) how the employee will be better off overall in relation to the terms and conditions of his or her employment as a result of the arrangement; and
(e) states the day on which the arrangement commences.” [My underlining]
[12] Clause 9 of the Agreement deals with apprentices and by clause 9.3.5 provides:
“9.3.5. Except as provided in this clause where otherwise stated all conditions of employment specified in the Agreement shall apply to apprentices. The ordinary hours of employment of apprentices shall not exceed those of the relevant tradesperson.” [My underlining]
[13] The word “conditions” is also frequently used in the Agreement to describe a variety of things. In clause 8.6.3 it is used to describe the employment conditions to which an employee who is temporarily transferred to another site, will during the period of transfer, be entitled. In clause 12.1, the word is used in conjunction with the word “terms” to describe the employment conditions under the Agreement as they pertain to casual employees. The word “conditions” in clause 20.2 is used to describe the requirements under the Agreement that attach to “Call ins”. In clause 23.10 the word is used to describe how entitlements to maternity, paternity, adoption and family leave will be applied. In clause 20.5 the word “conditions” is used to describe an exception to the general requirement that meal breaks shall normally commence at 12.30pm. Clause 36.4 of the Agreement uses the word “conditions” as a reference point to the conditions of employment of employees of contractors engaged by TW Power, comparative to the conditions provided for in the Agreement. Clause 37 of the Agreement uses the word conditions to describe weather, while attachment E of the Agreement uses the word “conditions” to describe mental illness.
[14] Apart from in clause 37 and in attachment A, which both use the word “conditions” in a different contextual setting, the reference to conditions found elsewhere in the Agreement seems squarely to point to an enforceable right vested in the employees to the conditions specified.
[15] It seems to me that the expression “conditions of employment” is capable of a number of meanings apart from the particular context of clause 5.7. “Conditions of employment” could mean conditions set out in a statute, enterprise agreement or award which are consequential upon the employment of an employee. The expression could also relate only to the terms of a contract of employment whether express or implied. The expression might also relate to any incidental matter or practice relating to employment or the performance of work which though not legally enforceable has come to be a practice that is beneficial to employees in their employment.
[16] The first of the possible meanings is immediately eliminated having regard to contextual considerations. Clause 5 of the Agreement incorporates terms of the relevant awards which might have had application to employees covered by the Agreement. The incorporated award terms have effect by force of the Agreement. The relevant modern award however does not apply to an employee relation to particular employment at a time when the Agreement applies to the employee in relation to that employment. 3 Conditions of employment set out in the National Employment Standards (NES) established under the Act, cannot be excluded by the Agreement4 and any term of the Agreement which has or purports to have that effect is of no effect.5 The relationship between the NES and the Agreement is further dealt with in clause 6 of the Agreement. Any earlier enterprise agreement that has passed its nominal expiry date, which applied to an employee covered by the Agreement in relation to the particular employment ceased to apply to that employee when the Agreement came into operation,6 and can never operate again.7 The Agreement prevails over a law of a State or Territory to the extent of inconsistency, save that in respect of particular identified State or Territory laws the Agreement operates subject to those identified laws.8
[17] Thus the statutory context in which the Agreement was made, combined with reading clause 5.7 in the context of clause 5, as a whole leads inescapably to the conclusion that the expression “conditions of employment” in clause 5.7 does not mean conditions that are set out in a statute, enterprise agreement or award.
[18] As to the second and third possible meaning, I do not consider that the expression “conditions of employment” in clause 5.7 of the Agreement extends beyond contractual terms. The juxtaposition of the words “existing over Agreement payments” with “and conditions of employment” is suggestive of an obligation of one of the parties to the contract of employment to the other party to the contract, which arises from the terms of the contract. The existing conditions which clause 5.7 seeks to preserve are conditions that arise from the terms of the contract of employment, whether express or implied, by law or fact or custom and usage, or are imported into the contract by force of some other document independent of the intentions of the parties to the contract. In my view, the expression “conditions of employment” used in the context of clause 5.7 of the Agreement does not extend to work practices or privileges arising from or in connection with the employment, which although enjoyed by employees, are not contractual.
[19] It was not submitted that the existing practice was contractual in nature and it was conceded that the evidence was insufficient for there to be a conclusion that the existing practice formed an express contractual term, or was otherwise to be implied as a term of contract of employment of any or all of the employees affected. 9
[20] I do not rule out the possibility that the current practice might be an implied term of the contract of employment of some or all of the affected employees, however based on the material before me such a conclusion could not properly be drawn, nor was the Unions’ case conducted on that basis.
[21] It follows that the existing practice is not part of the conditions of employment within the meaning of that expression as used in clause 5.7 of the Agreement. Since it is not a condition of employment, it cannot be part of the over agreement conditions of employment protected by clause 5.7. The answer to question 1 is no.
Whether there is a variation to the usual finishing time
[22] Clause 13 deals with hours of work and related matters, and provides the following:
“13. NORMAL WORKING HOURS AND ROO's
13.1. The ordinary hours of work shall be 36 hours per week exclusive of meal breaks between Mondays to Friday.
13.2. The ordinary hours of work shall be worked continuously except for meal breaks between 06:00 am to 6:00 pm. Provided that the usual starting time and usual finishing time within the spread of hours may not be varied except by agreement of the employer and parties to this agreement.
13.3. Rostered Days Off will normally be on the basis of one (1) Rostered Day off per two (2) week period, (excluding Long Service and unpaid leave) in accordance with an agreed posted roster.
13.4. The first 4 hours worked in each ordinary pay week day will be banked into the RDO accrual fund.
13.5. See attachment C - RDO management.”
[23] It is not in dispute that affected employees sign off on the paper timesheet which they complete each day as finishing at 3.30pm. It is also not in dispute that the relevant employees are paid for ordinary hours worked commencing at 7.00am and finishing at 3.30pm.
[24] The Unions submitted that the phrases “usual starting time” and “usual finishing time” as they appear in sub-clause 13.2 of the Agreement indicate a common understanding as to custom and practice with respect to the commencement and finishing of work each day. The TW Power proposal purports to alter this common understanding. However, clause 13.2 operates to the effect that there should be no change to this common understanding unless that change is agreed by the parties to the Agreement, namely TW Power and its employees covered by the Agreement, the AMWU and the CFMEU. The Unions submitted that there is no evidence of any such agreement and as such, clause 13.2 operates to specifically prohibit the TW Power proposal from being implemented.
[25] I do not accept that the phrase “usual finishing time” in clause 13.2 of the Agreement means the time at which the affected employees are permitted to leave the brew room (at 3.25pm) pursuant to the current practice.
[26] Clause 13.1 of the Agreement provides that ordinary hours of work shall be 36 per week. Clause 13.2 provides that those ordinary hours shall be worked within the span of hours between 6.00am to 6.00pm Monday to Friday. The starting and finishing times as recorded on the paper timesheets by affected employees, and for which they are paid, are respectively 7.00am and 3.30pm. The reference to the “usual starting time” and the “usual finishing time” in clause 13.2 is a reference to the usual beginning and the ending of ordinary hours of work within the span of permissible hours. Allowing for the meal break, ordinary hours of work performed between 7.00am and 3.30pm across five shifts results in 36 ordinary hours of work. This is consistent with the prescribed number of ordinary hours found in clause 13.1. If “usual finishing time” is to mean 3.25pm, the time at which the affected employees are permitted to leave the brew room, then the ordinary hours of work in a week will be 35 hours and 35 minutes. That the affected employees have, by reason of the current practice, been permitted to leave the brew room at 3.25pm on each day does not mean that that practice converts 3.25pm to the “usual finishing time” within the meaning of clause 13.2 of the Agreement.
[27] The phrase “usual finishing time” must be read and understood in the context of the hours of work provision as a whole. As earlier indicated, the Agreement, by clause 13.1, determines that the ordinary hours of work shall be 36 per week. Necessarily, pursuant to the Agreement those hours are to be worked between Monday to Friday and within a span of hours between 6.00am to 6.00pm. Given that it is uncontested that the usual starting time is 7.00am on each weekday, the only construction which is permissible to give effect to the Agreement’s mandate that ordinary hours of work shall be 36 per week, is for “usual finishing time” in clause 13.2 to be given a meaning that corresponds with that mandate and, consequently that time is 3.30pm. This is consistent with the finishing time noted on the affected employees’ timesheets and the time until which an employee is paid for ordinary hours worked each weekday.
[28] It follows that the answer to question 2 is no.
Whether the TW Power proposal is an extra claim
[29] Clause 43 of the Agreement deals with no extra claims and provides the following:
“It is a term of this Agreement that the Parties bound by this Agreement will not pursue any extra claims for the life of this Agreement.”
[30] Self-evidently the reference to “parties bound” should, given the nomenclature used in the Act, be read as a reference to persons covered by the Agreement while it is in operation.
[31] The Unions submitted that the TW Power proposal amounts to an extra claim for the purposes of clause 43 of the Agreement, with the consequence that a pursuit of its proposal amounts to a breach of Clause 43 of the Agreement.
[32] The Unions’ submitted that the reference to “extra claim” should not be understood in a limited sense. They submitted that “claim” should be construed as anything pertinent to the employer/employee relationship and extends beyond the expression “conditions of employment”. 10
[33] Whatever else might be said about the meaning of “claim” in clause 43 of the Agreement, in my view it cannot and does not mean the insistence by TW Power that employees remain at work for the ordinary hours of work prescribed by the Agreement for which they are paid. Such a proposal is not a claim. It is merely the insistence by TW Power that there be adherence to the ordinary hours of work prescribed by the Agreement. In other words, TW Power is insisting on its legal right pursuant to the Agreement to require its employees to be at work for the entire period of the ordinary hours prescribed by the Agreement. Insisting on that which is permitted or required by the Agreement is not an extra claim.
[34] It follows that the answer to question 3 is no.
Conclusion
[35] For the reasons given the dispute is resolved by answering each question posed as follows:
- Question 1 – Answer, No;
- Question 2 – Answer, No;
- Question 3 – Answer, No.
[36] No orders are necessary.
DEPUTY PRESIDENT
Appearances:
Mr D. Vroland of the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU).
Mr P. Wheelahan, Counsel on behalf of TW Power Services.
Hearing details:
2016.
Melbourne.
August 10.
1 Transcript PN4.
2 [2014] FWCFB 7447.
3 See s.57 of the Act.
4 See s.55 of the Act.
5 See s.56 of the Act.
6 See s.58 of the Act.
7 See s.54 of the Act.
8 See s.29 of the Act.
9 Transcript PN562 – PN569.
10 Transcript PN659.
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