Christopher Worthy v Virgin Australia Airlines Pty Ltd
[2013] FWC 3233
•26 JUNE 2013
[2013] FWC 3233 |
FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.217—Enterprise agreement
Christopher Worthy
v
Virgin Australia Airlines Pty Ltd
(AG2013/773)
Airline operations | |
VICE PRESIDENT WATSON | SYDNEY, 26 JUNE 2013 |
Application for variation of the Virgin Blue Cabin Crew Agreement 2009 - variation to remove ambiguity - alleged ambiguity in relation to part-time employees and personal leave - whether ambiguity exists - whether application meets requirements of the Act - Fair Work Act 2009 - s.217.
Introduction
[1] This decision concerns an application by Mr Christopher Worthy pursuant to s.217 of the Fair Work Act 2009 (the Act) to vary the Virgin Blue Cabin Crew Agreement 2009 1(the Agreement). The application seeks to prevent Virgin Australia Airlines Pty Ltd (Virgin) from varying the Agreement in relation to part-time employment.
[2] At the hearing of the matter in Brisbane on 20 May 2013 Mr Worthy appeared on his own behalf with Ms C Summers and Mr J Wells, solicitor, with Mr B Frost appeared on behalf of Virgin.
Relevant legislation
[3] Section 217 of the Act relevantly provides as follows:
217 Variation of an enterprise agreement to remove an ambiguity or uncertainty
(1) The FWC may vary an enterprise agreement to remove an ambiguity or uncertainty on application by any of the following:
(a) one or more of the employers covered by the agreement;
(b) an employee covered by the agreement;
(c) an employee organisation covered by the agreement.
(2) If the FWC varies the enterprise agreement, the variation operates from the day specified in the decision to vary the agreement.
The Application
[4] The relief sought by Mr Worthy in his application is as follows:
“(a) Virgin Australia Airlines [formerly Virgin Blue Airlines] be restrained from varying clause 2.1.3(c) of the relevant industrial instrument approved by Cabin Crew employees.
(b) Virgin Australia Airlines [formerly Virgin Blue Airlines] honour its ordinary time earnings, annual lave pay, annual leave loading and superannuation payable for Permanent Part Time Variable Hours classification as agreed and approved by a majority of Cabin Crew employees under the relevant industrial instrument.”
[5] In his outline of submissions Mr Worthy also proposed a variation to clause 4.2.1(j) by adding the following words at the end of the clause:
“Hours credited for personal leave will not be subtracted from rostered ordinary hours.”
Relevant Provisions of the Agreement
[6] The underlying dispute relates to the treatment of paid personal leave for employees who are known as ‘part-time variable employees’, being those employees who will normally be rostered to work between 70 and 80 hours per two week roster period. The Agreement sets out provisions concerning part-time employment at clause 2.1.3. The clause is in the following terms:
“2.1.3 Part time employment
(a) A part time employee will work to the same terms and conditions as a full time Cabin Crew Member, unless otherwise specified within this Agreement.
(b) Cabin Crew Members who were part time prior to the commencement of this Agreement will be rostered to a maximum of 70 ordinary hours per roster period.
(c) Cabin Crew Members who take up a part time role after the commencement of this Agreement will be rostered to a maximum of 80 ordinary hours per roster period.
(d) A part time Cabin Crew Member who is rostered to work less than 70 hours in a roster period cannot be directed work more than 72.5 hours in that roster period. A part time Cabin Crew Member who is rostered to work more than 70 hours in a roster period cannot be directed to work more than 82.5 hours in that roster period.
(e) Designated Days Offfor part time employees will be rostered in accordance with clause 6.3.
(f) Where days are rostered as Optional Days, you may elect to work, but you cannot be directed to work.
(g) You will be paid a pro-rata Total Annual Salary of a full time Cabin Crew Member for the actual ordinary hours you work (excluding time worked on a nominated Available Day or designated day off).
(h) Hours worked on an Optional Day will not count towards your maximum hours in a roster period. You will be paid at your hourly rate of pay for all time worked on an Optional Day. This hourly rate of pay will be calculated on the basis of your Total Annual Salary.”
[7] Paid personal leave is set out at clause 4.2.1 of the Agreement. The clause provides:
“4.2.1 Paid Personal Leave
(a) Personal leave can be accessed in the following circumstances:
- If a personal illness or injury results in you not being fit for work;
- If you need to provide care or support to a member of your household or immediate family who is ill or injured or has suffered an unexpected emergency.
(b) Full time Team Members will accrue 15 days of personal leave for each completed year of service. Part time Team Members will be entitled to personal leave on a pro rata basis. Personal leave will accrue in accordance with the Fair Work Act (Cth).
(c) Personal leave is cumulative.
(d) If you have accessed all of your accrued personal leave and are still unable to attend work due to an illness or injury, or an obligation to care for someo.ne, you will need to discuss this with your Leader as soon as possible. They will consider what arrangements may be put in place to assist you.
(e) There is no entitlement to paid personal leave for any period that you are receiving workers compensation payments.
(f) When personal leave is notified to be accessed before roster publication, Cabin Crew Members will be credited 5 hours towards their roster cycle hours for each day of personal leave.
(g) When personal leave is accessed after roster publication, Cabin Crew Members will be credited with the scheduled duty hours on the day(s) the personal leave is taken.
(h) When personal leave is accessed on a de-nominated Available Day or a Re assignable Day, Cabin Crew Members will be credited 5 hours towards their ordinary hours.
(i) When personal leave is accessed on a nominated Available Day, Cabin Crew Members will not receive a credit towards their roster cycle hours.
(j) Hours credited for personal leave will not be taken into account for the purpose of determining an entitlement to overtime in accordance with 6.5.1(a) and 6.5.1(b).”
The Underlying Dispute
[8] Mr Worthy submits that an ambiguity arises in respect of the administration of hours and payments to part-time variable employees under the Agreement. He submits that an alteration to the payroll processing system in September 2011 has given rise to this ambiguity.
[9] Mr Worthy submits that the calculation of personal leave credits and the system of personal leave debits results in employees classified as part-time variable under the Agreement not receiving the correct personal leave entitlement. He submits that in altering the way in which hours and earnings for part-time cabin crew are administered, Virgin has effectively varied the Agreement. It is more accurate to describe this position as an alleged breach of the Agreement.
[10] Part-time variable employees can be rostered up to 80 hours per roster period of 28 days. They are guaranteed payment for 70 hours provided no leave absences occur where leave accruals have been exhausted.
[11] Cabin Crew members accrue 15 days of personal leave per annum. For accrual purposes each personal leave day is treated as a 5 hour leave credit. This is pro-rated for part-time cabin crew as 2.5 hours per day of absence. This appears to be an administrative arrangement that produces the outcome of 37.5 hours of personal leave per year if 15 absences occur.
[12] The evidence establishes that when a part-time variable employee is absent on sick leave after roster publication, Virgin applies different practices depending on whether the employee is rostered to work up to 70 hours or more than 70 hours in the roster period. Mr Rohweder, the Manager, Cabin Crew for Virgin, gave evidence of two examples to demonstrate Virgin’s approach. In the first example personal leave of eight hours is taken by an employee who is rostered to work 70 hours in the 28 day cycle. The roster records the cabin crew member as having worked 70 hours even though they have only worked 62 hours. The sick leave debited is 2.5 hours. In the second example personal leave of eight hours is taken by a cabin crew member who is rostered to work 80 hours in the roster period. They are paid 72 hours pay and sick leave of 2.5 hours is debited. The discrepancy apparently relates to the practice of debiting all sick leave absences as 2.5 hours and the application of the guaranteed payment for 70 hours.
[13] In respect of the Agreement provisions, Virgin submits that the classification of part-time variable employee at clause 2.1.3(c) was introduced to enable it to roster a part-time employee for up to 80 hours per roster cycle. It submits that there is no minimum number of hours guaranteed per roster cycle because the hours will vary, the pro-rata hourly rate is determined by reference to 70 hours per roster cycle for both categories of part-time employee. It submits that it treats 70 hours as the guaranteed number per roster cycle whether or not that number of hours is worked. Virgin submits the significance in respect of personal leave accruals is as follows: 2
“(a) the EBA [Agreement] deals with personal leave at clause 4.1.2;
(b) for full time cabin crew, the rate of accrual is 15 days per year (clause 4.2.1(b)), and when accessed, it is treated as a 5 hour leave credit (4.2.1(h));
(c) for part time cabin crew, the rate of accrual is pro-rated (clause 4.2.1(b)), and when accessed, it is treated as a 2.5 hour leave credit regardless of the actual shift missed (based on the assumed 70 hours per roster cycle);
(d) if a part time cabin crew member takes personal leave and still works in excess of 70 hours in a roster cycle, they are not paid in relation to that personal leave; and
(e) if a part time cabin crew member takes personal leave and this reduces their hours actually worked below 70 hours, they are still paid for 70 hours regardless of how many personal leave hours are taken. In other words, each absence is treated as 2.5 hours per day and, to the extent the sum of hours worked plus personal leave credits is below 70 hours, the difference is treated and paid as ordinary hours.”
[14] The underlying dispute is whether this arrangement is consistent with the Agreement. It is appropriate that I make some comments about this issue. The application of pro-rata personal leave entitlements for part-time cabin crew arises from clause 4.2.1(b) of the Agreement. The crediting for each personal leave absence of five hours for full time employees and 2.5 hours for part-time employees purports to be in accordance with clause 4.2.1(f). However, the practice is applied to part-time employees regardless of whether the absence is notified before or after roster publication. This is despite the Agreement providing for two different approaches depending on the timing of the notification of the absence. Clause 4.2.1(g) specifically deals with the situation where the absence is notified after roster publication. It provides that in that case “Cabin Crew Members will be credited with the scheduled duty hours on the day(s) the personal leave is taken.” Hence in the second example raised by Mr Rohweder, which could only occur after roster publication, an employee rostered to work 80 hours should be paid for their scheduled duty hours. A practice which does not lead to payment of that amount during the relevant pay period results in an underpayment.
Variation to the Agreement
[15] It is this issue of compliance with the Agreement which is the underlying dispute in this matter. The application is made under the provision of the Act that provides for variations to agreements. However, no variation to the Agreement was sought in the original application. The original application was therefore technically deficient. In the outline of submissions filed before the hearing Mr Worthy ultimately sought a variation to the agreement to remedy the alleged breach. The variation seeks to add the words “Hours credited for personal leave will not be subtracted from rostered ordinary hours” to clause 4.2.1(j).
[16] Mr Worthy submits that the variation resolves an ambiguity over the meaning of the relevant clauses and provides clarity in a way that reflects the fair and proper meaning of the Agreement.
[17] Virgin submits that the application does not meet the requirements of s.217 of the Act and ought to be dismissed. It submits that the approach identified by the Australian Industrial Relations Commission in Re Tenix Defence Pty Limited 3 should be followed.
[18] Virgin submits that the status of the Agreement should be taken into account. The Agreement was approved on 4 December 2009 and has a nominal expiry date, at clause 1.4, of three years from the first roster cycle following approval. It submits that the nominal expiry date has now passed and parties are turning attention to a new agreement. It submits any alleged ambiguity can be addressed during negotiations for a new agreement.
[19] Virgin submits that the evidence led by Mr Worthy does not enable the Commission to find that the parties intended an outcome consistent with his submissions. It submits that Mr Worthy’s application essentially sets out contentions of his interpretation of the Agreement provisions.
[20] In considering an application for variation of an Agreement on the ground of an ambiguity the established approach is to consider first whether there is an ambiguity in the provisions. If there is an ambiguity it is a matter of discretion whether the agreement should be varied and how it should be varied. Where the ambiguity involves a dispute as to the proper interpretation of the agreement, an assessment should be made as to the proper interpretation having regard to the principles for interpreting agreements. This will often be an important consideration in determining whether to vary the agreement and the nature of the variation.
[21] In this matter, counsel for Virgin concedes that there is an ambiguity in the provisions. I have considerable doubt as to whether this is correct because the practice of Virgin does not appear to arise from an interpretation of the provisions of the Agreement. Rather, it is adopted in spite of the provisions which clearly differentiate the practices for absences occurring before and after roster publication and create an entitlement to payment for scheduled duty hours when notification of an absence on personal leave occurs after roster publication.
[22] If there is an ambiguity the interpretation that I have adopted would be an important indicator of an appropriate variation that should be made. However, a further difficulty arises from the variation sought by Mr Worthy. In my view the variation sought is not itself clear, it seeks to vary the wrong sub-clause, and it does not appear to be a sound way to cure the alleged ambiguity.
[23] I also note that the Agreement has passed its nominal expiry date and is currently being renegotiated.
[24] In all of the circumstances I consider that the best way of dealing with this matter is for the parties to consider appropriate variations to the relevant clause of the Agreement in their current negotiations. The parties will be able to take into account my view as to the meaning of the current provisions.
Conclusion
[25] I have concluded that the application has disclosed a practice adopted by Virgin in relation to the crediting of personal leave which in my view is inconsistent with the current terms of the Agreement. However, the provisions are not, in my view ambiguous. Nor does the proposed variation appear to be an appropriate way to clarify the matter. As the parties are currently in negotiations to renew the Agreement I consider that the preferable course is for the parties to address this matter, with the benefit of this decision, in their negotiations. I consider that further assistance or further relief should be the subject of a separate application. For these reasons I will dismiss the application.
VICE PRESIDENT WATSON
Appearances:
C. Worthy with C. Summers for Mr Worthy.
J. Wells with B. Frost on behalf of Virgin Australia Airlines Pty Ltd.
Hearing details:
2013.
Brisbane.
May, 20.
1 AE872622.
2 Exhibit V1.
3 PR917548.
Printed by authority of the Commonwealth Government Printer
<Price code C, AE872622 PR537152>
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