Chris Crole v Commonwealth of Australia as represented by the Department of Defence
[2022] FWC 2694
•10 OCTOBER 2022
| [2022] FWC 2694 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.739—Dispute resolution
Chris Crole
v
Commonwealth Of Australia as represented by the Department of Defence
(C2022/281)
| COMMISSIONER MCKINNON | SYDNEY, 10 OCTOBER 2022 |
Application to deal with a classification dispute – classification of APS employee – whether matters arising under the Agreement – whether dispute resolution process followed – right of review under the Public Service Act 1999.
Mr Chris Crole is in dispute with the Department of Defence about the appropriate classification and rate of pay for his former role of WHS Manager, Auxiliary Oiler Replenishment System Program Office (AORSPO). On 6 January 2022, Mr Crole applied to the Commission to deal with the dispute under section 739 of the Fair Work Act 2009 (FW Act) and clause A8 of the Defence Enterprise Agreement 2017 - 2020 (the Agreement). The parties have since narrowed the issues in dispute. What remains is relevant only to the period from 27 September 2021 to 11 January 2022 (when Mr Crole ceased performing the role) or 2 February 2022 (when Mr Crole received a work value assessment for his former role). I will refer to the period from 27 September 2021 to 2 February 2022 as “the disputed period”.
Mr Crole asks me to find that during the disputed period, he should have been classified as an Executive Level 1 (EL1) employee instead of an APS Level 6 (APS6) employee and that he is entitled to backpay for the disputed period. Mr Crole puts the question this way:
“Should I have been appointed at an Executive Level 1 (EL1) classification upon commencement of my role, given the title of my appointment (Work Health and Safety Manager) and the inherent requirement of the Defence Classification Policy (Strategic Welfare Function), in support of administering the Classification Rules and Annex C of the Defence Enterprise Agreement, where the classification of Executive Level 1 (Annex C) is directly linked to the Work Health and Safety Manager role, as shown in the Defence Classification Policy, through the definition of “Classification” in the Glossary of Terms at page 58 of the Agreement.”
The Department objects to the application on two grounds. Firstly, it submits that the dispute resolution term does not apply to the dispute because the classification of Mr Crole is not a matter arising under the Agreement or the National Employment Standards. Secondly, the Department submits that the dispute resolution process has not been followed, meaning that the Commission cannot deal with the dispute.
I have concluded that I do not have jurisdiction to deal with the dispute. These are my reasons.
The Agreement
The Agreement is a single enterprise agreement covering the Department and its Australian employees below Senior Executive Service and equivalent levels. Under clause A3.1, the Secretary of the Department may issue APS People Policies (Policy Statement and Policy Guidance) to support the operation of the Agreement, although they do not form part of the Agreement.
Clause A8 of the Agreement contains the procedure for dealing with disputes. It provides as follows:
“A8 Dealing with disputes
A8.1 If a dispute relates to a matter arising under the Agreement or the National Employment Standards this term sets out procedures to settle the dispute.
A8.2 An employee who is a party to the dispute may appoint a representative for the purposes of the procedures in this term.
Discussion within Defence
A8.3 In the first instance, an employee or their representative should discuss the dispute with their supervisor. If discussions at the workplace level do not resolve the dispute, it should be referred to more senior levels of management for resolution. If discussions with senior levels of management do not resolve the dispute it should be escalated to the national level.
Referral to the Fair Work Commission
A8.4 If discussions at the workplace level do not resolve the dispute, a party to the dispute may refer the matter to the Fair Work Commission.
A8.5 The Fair Work Commission may deal with the dispute in two stages:
a. the Fair Work Commission will first attempt to resolve the dispute as it considers appropriate, including by mediation, conciliation, expressing an opinion or making a recommendation; and
b. if the Fair Work Commission is unable to resolve the dispute at the first stage, the Commission may then arbitrate the dispute and make a determination that is binding on the parties.
Note: If the FWC arbitrates the dispute, it may also use the powers that are available to it under the Fair Work Act.
A8.6 A decision that the Fair Work Commission makes when arbitrating a dispute is a decision for the purpose of Div 3 of Part 5.1 of the Act. Therefore, an appeal may be made against the decision.
A8.7 Without prejudice to either party to the dispute, except where a bona fide safety issue is involved, each party to a dispute must, at all times, continue to perform its obligations under this Agreement. Where a bona fide safety issue exists, an employee shall not work in an unsafe environment but will accept reassignment to alternative suitable work in the meantime unless there are other reasonable grounds for the employee to refuse to comply with the direction.
A8.8 The parties to the dispute agree to be bound by a decision made by the Fair Work Commission in accordance with this term.”
Part B of the Agreement is headed “Managing and structuring the workforce”. Relevantly within Part B, clause B1 provides for the Secretary of the Department to approve broadbands, consistent with principles including that the broadband operates consistent with the Public Service Classification Rules 2000 and that “any Defence broadband operates according to its terms, as if they were part of this Agreement” (a matter to which I will return).
“Broadbanding” is defined in the Agreement as “the combination of two or more adjacent classifications into a single broader group of duties and includes the full range of work value and work level standards of the classification levels contained within it.”
“Classification” is defined in the Agreement as “the approved work value assigned to a group of duties by the Secretary in accordance with the Public Service Classification Rules (2000), supported by guidance in the Defence Classification Policy, as amended from time to time.”
“Salary” is defined in the Agreement as “an employee's rate of salary as specified in the salary scales at Annex C. Where salary sacrifice or purchased leave arrangements are in place, the employee's base salary, for the purposes of superannuation and severance and termination payments, will be determined as if the arrangement(s) did not exist. Nothing in this definition will prevent the allowances specified in Annex D forming part of salary for superannuation purposes or severance and termination payments.”
Clause D1.3 of the Agreement requires performance expectations to be appropriate to the classification level of the employee. Clause D5.3 permits a reduction in classification in the case of unsatisfactory performance.
Part G deals with remuneration. Under clause G1.1, employees are to be paid a salary for their classification in accordance with the tables at Annex C. Adjustments to rates of pay are prescribed in clause G2 of the Agreement, while clause G3 deals with salary (within the established relevant salary range) on engagement, promotion, assignment, movement or reduction. Clause G4 provides that the Secretary may assign duties and determine the salary of an employee performing work at the EL2.1 or EL2.2 levels of the Executive Level 2 (EL2) classification. The Defence Classification Policy (which does not form part of the Agreement) describes the value of such work.
Clause G5 provides for “Additional Responsibility Pay (ARP)”, which is for the “temporary performance of duties at a higher work level by an employee”. It can be either position-based, where an employee performs the duties or responsibilities of a vacant higher‑level position, or non position‑based, where duties or responsibilities of a higher work level are performed or where establishment or classification action is neither warranted nor appropriate.
Annex C contains salary scales aligned to the standard and job-specific classifications listed in the Agreement. Annex E contains a table of “salary for particular purposes”, including ARP, which counts towards salary for specified purposes.
Is the dispute about a matter arising under the Agreement?
As can be seen, despite numerous references in the Agreement to ‘classification’, there is no mechanism through which the classification of an employee can or is to be determined under the Agreement, either directly or through the incorporation of terms. Contrary to Mr Crole’s submission, clause A3.1 does not require the Secretary to use the Defence Classification Policy to support the operation of the Agreement. It simply permits the Secretary to make a policy of this kind. Once it is made, the policy operates separately to the Agreement. It does not form part of the Agreement.
Clause A4.1 permits the Secretary to delegate powers and functions under the Agreement to another, or to make related directions. This provision only operates in relation to powers and functions conferred on the Secretary by the Agreement. The Agreement confers no power or function on the Secretary in relation to the classification of an APS employee and does not need to. As will become evident, these powers and functions are separately conferred by the Public Service Act1999 (PS Act).
The Agreement does provide for the Secretary to approve broadbands in accordance with the Classification Rules, but those rules do not form part of the Agreement. The Agreement defines ‘broadbanding’ as a group of classifications and contemplates a (not yet developed) Defence broadband that will operate as if it were part of the Agreement. It defines ‘classification’ by reference to decisions made by the Secretary about the work value of groups of duties in accordance with the Public Service Classification Rules 2000 (Classification Rules) and Defence Classification Policy.
The Agreement contains salary scales, setting the applicable minimum salary range for both standard and job-specific classifications. Salary is payable “according to the classification of the employee”, which is separately determined under the Classification Rules and Defence Classification Policy. Performance expectations are to be appropriate to the employee’s classification level and a reduction in classification can be imposed in the event of unsatisfactory performance.
The Agreement makes provision in the Agreement for ARP, which is an allowance for the temporary performance of higher duties. ARP is in addition to the applicable salary for an employee’s classification. It does not result in any change in classification. Reclassification of a position does not necessarily result in the reclassification of an employee, as the reclassification may result in a position being offered to a person at the higher (or lower) classification.
The classification of employees is instead a matter regulated by the PS Act, including by sections 7, 9 and 23. Section 23 of the PS Act provides for the APS Commissioner to make classification rules by legislative instrument. While the PS Act operates subject to the FW Act, there is nothing in the FW Act that would displace the responsibilities of the APS Commissioner in relation to the Classification Rules, or the responsibilities of a departmental secretary in relation to the classification of departmental employees.
For present purposes, the APS Commissioner has made the Classification Rules. Rule 6 requires the relevant Agency Head (in this case, the Secretary of the Department), to allocate an approved classification to each Agency APS employee (in this case, Mr Crole). The classification must be based on the group of duties that are determined by the Secretary to be the duties to be performed by the employee.
Duties are then classified in accordance with rule 9 of the Classification Rules. Under rule 9, the Secretary (or their delegate) must allocate an approved classification to each group of duties to be performed by the Department. The allocation must be based on the work value of the group of duties. Allocation of an APS Level classification must be based on the work value of the group of duties described in the published ‘work level standards’ for that classification. If a group of duties involves work value applying to more than one classification, the Secretary may allocate a broadband to the group of duties.
The APS Commissioner publishes the APS Work Level Standards. These can then be supplemented by individual agency guidance. The Department has adopted a Policy on Work Level Standards, which requires the “creation, review or reclassification” of a position to be based on an assessment of the value of the work as described in the Defence Work Level Standards. These, and the Department’s classification management principles, are set out in the “Defence Classification Manual”.
It is in the Defence Classification Manual that one finds the framework of the Department’s classification structure and sample classification descriptions for each classification. The Defence Classification Manual applies separately to the Agreement and is not incorporated as part of the Agreement. Despite clause B1 of the Agreement, which provides that any Defence broadband operates according to its terms as if they were part of the Agreement, Chapter 5 of the Manual dealing with “Broadbands” is currently blank and “under development”. Even if it could be said to be the vehicle through which a classification mechanism was incorporated in the Agreement (which I reject), it would have no meaningful operation.
For these reasons, I find that the appropriate classification of Mr Crole’s former role of AORSPO WHS Manager during the disputed period is not a matter arising under the Agreement. It is not something that can be determined by reference to the terms of the Agreement. It is not a matter arising under the National Employment Standards.
As I do not have jurisdiction to deal with the dispute under clause A8 of the Agreement, I cannot arbitrate the dispute, or make a recommendation, or express an opinion in relation to the dispute. This position is not altered by the Department having agreed to participate in conciliation on the basis that they did before the question of jurisdiction was determined.
Other relevant matters
Failure to follow the dispute resolution procedure
Given my finding in relation to jurisdiction, it is not strictly necessary to consider whether Mr Crole has followed the dispute resolution procedure in clause A8 of the Agreement in relation to the classification dispute. However, I make the following observations:
The reference to discussions “at the workplace level” in clause A8.4 of the Agreement is a reference to all of the discussions in clause A8.3, not just those required in the first instance. While the words “workplace level” are used in clause A8.3 to describe the initial discussion between an employee and their supervisor, three stages of discussion are contemplated by clause A8.3. Each involves a mandatory step that must be taken at the workplace (as opposed to in the Commission) before a dispute can be referred to the Commission. The reference to “workplace level” in clause A8.4 has its ordinary meaning and reflects the escalation of the dispute from internal workplace discussions to facilitated dispute resolution in the Commission.
The first two steps of clause A8.3 were followed when Mr Crole raised and attempted to resolve the dispute with his immediate supervisors and then Mr Mal Adams, AORSPO Director, before 6 January 2022 when the dispute was filed.
The third step of clause A8.3 was not followed. This step required escalation of the dispute to “national level” before it was referred to the Commission on 6 January 2022. While the dispute was brought to the attention of national level managers, this only occurred after the dispute was notified to the Commission.
For these reasons, I would not have found jurisdiction to deal with the dispute for reasons that are separate to the characterisation of the dispute as one that falls outside the scope of the Agreement.
The claim for ARP
Mr Crole applied to the Commission to deal with the dispute on 6 January 2022. While there is some reference to Mr Crole requesting “acting duties at the EL1” level in mid‑December 2021 (see the statement of Ms Kitty Marmanidis), the claim for ARP did not form part of the dispute notified to the Commission. It was first raised in a formal sense in submissions filed by Mr Crole on 22 March 2022. The Department denies the claim for ARP, relying among other things on the 2 February 2022 work value assessment of Mr Crole’s former role, which confirmed the APS6 classification as correct.
The claim for ARP is plainly a matter arising under clause G5 of the Agreement. However, the mandatory workplace level discussions have not yet occurred between the parties under clause A8 of the Agreement in relation to the claim. The matter is not properly before the Commission.
Right of review under the PS Act
The allocation of an APS6 classification to Mr Crole’s role during the disputed period is an ‘APS action’ under the PS Act. Mr Crole is entitled to a review of APS action under section 33 of the PS Act and regulations 5.22-28 of the Public Service Regulations 1999 (PS Regulations). The entitlement is not lost under regulation 5.23, despite this application to the Commission. For the reasons above, the action is not one that can be reviewed by the Commission, because it is not a matter arising under the Agreement.
I do not agree with Mr Crole that it is not possible for him to seek a review of action in relation to his classification. The right of review is not displaced simply because the assignment of a classification to his former role occurred before Mr Crole’s appointment to the role, or because the person who made the appointment is no longer employed by the Department.
Separate application under s.372 of the Act
On 28 January 2022, Mr Crole made a separate application (C2022/775) to the Commission to deal with a general protections dispute not involving dismissal. The dispute is about changes made to Mr Crole’s role after the dispute arose, and a refusal to consider him for an EL1 level role. The application was adjourned pending resolution of this application. It will shortly be listed for conference.
Summary of findings
I do not have jurisdiction to deal with a dispute about the appropriate classification of Mr Crole during the disputed period. The related claim for backpay relies on determination of the dispute. It cannot be resolved independently of the classification dispute. However, the classification dispute is not a matter arising under the Agreement or under the National Employment Standards.
I do not yet have jurisdiction to deal with a dispute between the parties about ARP. If Mr Crole presses the claim for ARP for the disputed period, workplace level discussions should commence about the matter under clause A8 of the Agreement.
The application is dismissed.
COMMISSIONER
Appearances:
C Crole on his own behalf.
M Foran of Counsel for the respondent.
Hearing details:
2022.
Sydney (by video):
July 27.
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