Construction, Forestry, Maritime, Mining and Energy Union the Maritime Union of Australia Division v Transdev Brisbane Ferries Pty Ltd T/A Transdev Queensland

[2018] FWC 3421

[2018] FWC 3421

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739 - Application to deal with a dispute

Construction, Forestry, Maritime, Mining and Energy Union – The Maritime Union of Australia Division
v
Transdev Brisbane Ferries Pty Ltd T/A Transdev Queensland
(C2017/6704)

DEPUTY PRESIDENT ASBURY BRISBANE, 10 SEPTEMBER 2018

Alleged dispute about any matters arising under the enterprise agreement and the NES;[s186(6)] – Construction of enterprise agreement – Principles to be applied in construction of enterprise agreement – Application of contra proferentum rule – Meaning of term promoted - Finding that employees not entitled to uplift when temporarily performing higher role on basis they are not promoted.

[1] The Maritime Union of Australia (now known as the Construction, Forestry, Mining, Maritime and Energy Union – The Maritime Union of Australia Division) (CFMMEU) applies under s. 739 of the Fair Work Act 2009 (the Act) for the Fair Work Commission (the Commission) to deal with a dispute under a dispute settlement procedure in the Transdev Queensland (Ferry) Enterprise Agreement 2015-2017 (the Agreement). The dispute originally related to two issues: whether a clause of the Agreement providing for a pay uplift of 5% for employees who are “promoted” applies to both permanent and temporary promotions; and the rate of pay upon which the uplift for such employees is calculated.

[2] The dispute settlement procedure in the Agreement provides for disputes to be dealt with by the Commission using conciliation or mediation, and for the parties to jointly request the Commission to make recommendations about particular aspects of the dispute about which they are unable to reach agreement. The dispute was not resolved through conciliation or mediation and the parties jointly requested the Commission to make recommendations in the form of expressing an opinion as to whether:

1. Clause 3.3(i) of the Agreement applies to level 1 employees who are temporarily used in level 2 positions; and

2. If the recommendation to the above is in the affirmative, whether the 5% uplift applies to the actual rates set out at clause 3.3 of the agreement, or to the employee’s current rate of pay.

[3] The first question (the promotion issue) concerns the proper construction of clause 3.3.(i) of the Agreement. The second question (the base rates issue) arises because the rates of pay prescribed by the Agreement for some classifications are in excess of those provided for in the Ports, Harbours and Enclosed Water Vessels Award 2010 so that s. 206(2) of the Act requires that the higher Award rates are paid to employees in those classifications. Initially the Company’s position was that the 5% uplift would be paid on the base rate in the Agreement.

[4] In submissions filed by Transdev in relation to the dispute, the Company stated that it had determined that the 5% uplift would be paid to employees permanently promoted from a lower position to a higher position on the basis of the Award rate of pay and not the lower base rates set out in the Agreement. On the basis of this confirmation the parties accepted that if the Commission finds that the interpretation contended for the Respondent is correct, it is not necessary that the Commission make a finding in relation to the base rate issue.

[5] The parties filed material in relation to their respective positions including outlines of submissions, statements of evidence and facts which each asserted were established. Some but not all of the facts were agreed. Statements in support of the CFMMEU’s case were provided by:

● Robert Michael Carnegie, Branch Secretary 1;

● Robert John Sanderson, Customer Service Officer (CSO) 2;

● Robin Kay Smith, CSO 3;

● Yvette Bawden, Delegate and deckhand 4; and

● Timothy Mark Warburton, CSO 5.

[6] A statement in support of Transdev’s case was provided by Kristy Hammond, Payroll Supervisor 6. The parties agreed that the Commission should determine the matter on the basis of the material on the file without the need for a hearing.

APPROACH TO THE CONSTRUCTION OF ENTERPRISE AGREEMENTS

[7] The approach to construing enterprise agreements was most recently set out in a Decision of a Full Bench of the Commission in “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) v Berri Pty Ltd⁷ as follows:

“1. The construction of an enterprise agreement, like that of a statute or contract, begins with a consideration of the ordinary meaning of the relevant words. The resolution of a disputed construction of an agreement will turn on the language of the agreement having regard to its context and purpose. Context might appear from:

(i) the text of the agreement viewed as a whole;

(ii) the disputed provision’s place and arrangement in the agreement;

(iii) the legislative context under which the agreement was made and in which it operates.

2. The task of interpreting an agreement does not involve rewriting the agreement to achieve what might be regarded as a fair or just outcome. The task is always one of interpreting the agreement produced by parties.

3. The common intention of the parties is sought to be identified objectively, that is by reference to that which a reasonable person would understand by the language the parties have used to express their agreement, without regard to the subjective intentions or expectations of the parties.

4. The fact that the instrument being construed is an enterprise agreement made pursuant to Part 2-4 of the FW Act is itself an important contextual consideration. It may be inferred that such agreements are intended to establish binding obligations.

5. The FW Act does not speak in terms of the ‘parties’ to enterprise agreements made pursuant to Part 2-4 agreements, rather it refers to the persons and organisations who are ‘covered by’ such agreements. Relevantly s.172(2)(a) provides that an employer may make an enterprise agreement ‘with the employees who are employed at the time the agreement is made and who will be covered by the agreement’. Section 182(1) provides that an agreement is ‘made’ if the employees to be covered by the agreement ‘have been asked to approve the agreement and a majority of those employees who cast a valid vote approve the agreement’. This is so because an enterprise agreement is ‘made’ when a majority of the employees asked to approve the agreement cast a valid vote to approve the agreement.

6. Enterprise agreements are not instruments to which the Acts Interpretation Act 1901 (Cth) applies, however the modes of textual analysis developed in the general law may assist in the interpretation of enterprise agreements. An overly technical approach to interpretation should be avoided and consequently some general principles of statutory construction may have less force in the context of construing an enterprise agreement.

7. In construing an enterprise agreement it is first necessary to determine whether an agreement has a plain meaning or it is ambiguous or susceptible of more than one meaning.

8. Regard may be had to evidence of surrounding circumstances to assist in determining whether an ambiguity exists.

9. If the agreement has a plain meaning, evidence of the surrounding circumstances will not be admitted to contradict the plain language of the agreement.

10. If the language of the agreement is ambiguous or susceptible of more than one meaning then evidence of the surrounding circumstance will be admissible to aide the interpretation of the agreement.

11. The admissibility of evidence of the surrounding circumstances is limited to evidence tending to establish objective background facts which were known to both parties which inform and the subject matter of the agreement. Evidence of such objective facts is to be distinguished from evidence of the subjective intentions of the parties, such as statements and actions of the parties which are reflective of their actual intentions and expectations.

12. Evidence of objective background facts will include:

(i) evidence of prior negotiations to the extent that the negotiations tend to establish objective background facts known to all parties and the subject matter of the agreement;

(ii) notorious facts of which knowledge is to be presumed; and

(iii) evidence of matters in common contemplation and constituting a common assumption.

13. The diversity of interests involved in the negotiation and making of enterprise agreements (see point 4 above) warrants the adoption of a cautious approach to the admission and reliance upon the evidence of prior negotiations and the positions advanced during the negotiation process. Evidence as to what the employees covered by the agreement were told (either during the course of the negotiations or pursuant to s.180(5) of the FW Act) may be of more assistance than evidence of the bargaining positions taken by the employer or a bargaining representative during the negotiation of the agreement.

14. Admissible extrinsic material may be used to aid the interpretation of a provision in an enterprise agreement with a disputed meaning, but it cannot be used to disregard or rewrite the provision in order to give effect to an externally derived conception of what the parties’ intention or purpose was.

15. In the industrial context it has been accepted that, in some circumstances, subsequent conduct may be relevant to the interpretation of an industrial instrument. But such post-agreement conduct must be such as to show that there has been a meeting of minds, a consensus. Post-agreement conduct which amounts to little more than the absence of a complaint or common inadvertence is insufficient to establish a common understanding.”

[8] The Full Bench in Berri also went on to state:

“[65] Admissible extrinsic material may be used to aid the interpretation of a provision in an enterprise agreement with a disputed meaning, but it cannot be used to disregard or rewrite the provision in order to give effect to an externally derived conception of what the parties’ intention or purpose was. So much is clear from the oft-quoted statement of Madgwick J in Kucks v CSR Limited…”

[9] In that case Justice Madgwick observed:

“It is trite that narrow or pedantic approaches to the interpretation of an award are misplaced. The search is for the meaning intended by the framer(s) of the document, bearing in mind that such framer(s) were likely of a practical bent of mind: they may well have been more concerned with expressing an intention in ways likely to have been understood in the context of the relevant industry and industrial relations environment than with legal niceties or jargon. Thus, for example, it is justifiable to read the award to give effect to its evident purposes, having regard to such context, despite mere inconsistencies or infelicities of expression which might tend to some other reading. And meanings which avoid inconvenience or injustice may reasonably be strained for. For reasons such as these, expressions which have been held in the case of other instruments to have been used to mean particular things may sensibly and properly be held to mean something else in the document at hand.

But the task remains one of interpreting a document produced by another or others. A court is not free to give effect to some anteriorly derived notion of what would be fair or just, regardless of what has been written into the award.” 8

[10] In CFMEU v Endeavour Coal Pty Ltd T/A Appin Mine 9a Full Bench of the Commission held that the context of an agreement provision is significant. In this regard, the Full Bench set out the explanation of this point by the NSW Court of Appeal in Mainteck Services Pty Ltd v Stein Heurtey SA,10 which emphased the following matters:

•  Until a word or phrase is understood in the light of the surrounding circumstances, it is rarely possible to know what it means 11 and there is always some context to any statement;12

•  Language considered in its context will often have a clear meaning and context will often not displace that meaning – “but not always”; 13

•  To state that a legal text is clear reflects the outcome of an interpretation process and means that there is nothing in the context that detracts from the ordinary literal meaning and cannot mean that context can be put to one side; 14

•  The phrase used by Mason J in Codelfa “if the language is ambiguous or susceptible of more than one meaning” does not mean that the susceptibility of the language to more than one meaning must be assessed without reference to the surrounding circumstances and in order to determine whether more than one meaning is available it may be necessary to turn to context; 15 and

•  Context has also been described as surrounding circumstances and the meaning of terms normally requires consideration not only of the text, but of the surrounding circumstances known to the parties and the purpose and object of the transaction. 16

[11] The case law in relation to the approach to the construction of enterprise agreements makes it clear that context and purpose are relevant and must be considered even where the words of the provision being construed appear, on their face, to have a clear and unambiguous meaning. There is always context to any term of an enterprise agreement and the presence or absence of ambiguity is in the eye of the beholder.

[12] In addition to the approach to the construction of enterprise agreements set out in Berri, the CFMMEU submits that the Commission should apply the contra proferentem doctrine and construe the terms of the Agreement contrary to the meaning advanced by Transdev. The application of this doctrine is said to be appropriate on the basis that Transdev “inserted the whole of clause 3.3(i) into the Agreement, and by inference drafted the clause.” According to the CFMMEU, support for the application of the contra preferentem doctrine is found in the Federal Court Decision in Carr v Blade Repairs (Australia) Pty Ltd (No. 2) 17and the Decision of Commissioner Hunt in Fraser v Act for Kids18.

[13] In Carr the Federal Court was construing a contract of employment in order to determine whether termination of an employee was a breach of that contract. The contract provided that employment of the employee would continue until the termination of a supply contract held by the employer. The employer terminated the employee’s employment while the supply contract remained on foot, because it required fewer employees to perform the work under the supply contract. The employer in that case argued that the clause relied on by the employee was void for uncertainty and should be read down. Justice Tracey applied the principles relevant to the construction of commercial contracts holding that employment contracts should be construed practically so as to give effect to their presumed purpose and so as not to defeat the achievement of such purpose by a narrow and artificially restricted construction. His Honour also noted that the agreement was given to the employee by the sole director of the employer who had based it on a precedent document prepared by solicitors. His Honour held that:

“In such cases, where ambiguity exists, an agreement will normally be interpreted contra proferentem¸ that is, against the party who formulated the document.”

[14] The case referred to by Justice Tracey as setting out the rule of construction referred to above is Maye v Colonial Mutual Life Assurance Society Pty Ltd. 19 That case concerned whether a policy of life assurance could be avoided by the insurer in circumstances where the proposer of the policy had answered a question untruthfully. Isaac AJC, citing an earlier judgment of Blackburn J, set out the rule as follows:

“In all deeds and instruments the language used by one party is to be construed in the sense that it would be reasonably understood by the other. If there is any ambiguous phrase, another rule of construction, which was also known to the civil law applies: ‘Verba chartarum forties accipiunterur contra proferentem’…Ambiguous words …ought to be construed in that sense in which a prudent and reasonable man on the other side would understand them.” 20

[15] Justice Tracey also cited Wesoky v Village Cinemas International Pty Ltd 21 which concerned a consultancy agreement. In that case, Justice Merkel of the Federal Court cited authority setting out the justification for the contra proferentem rule as follows:

“…a person who puts forward the wording of a proposed agreement may be assumed to have looked after his own interests so that if the words leave room for doubt about whether he is intended to have a particular benefit there is reason to suppose that he did not.” 22

[16] In Fraser v Act for Kids 23 the rule was applied in circumstances where a contract of employment said to be for a specified period of time, was ambiguous. It can be seen that the contra proferentem rule can be used to resolve an ambiguity in a contractual term and not to create one. Further, the rule is applied where it is clear that the party who seeks the benefit of a contractual term has formulated that term and placed it before the other party. While I accept that the rule can be applied to resolve an ambiguity in an enterprise agreement, caution should be exercised. This is particularly so where the terms of an enterprise agreement are the subject of negotiations and there is evidence of contribution to the content of an enterprise agreement from employee bargaining representatives including union officials fulfilling that role. Caution in applying the rule is also warranted where a clause has been transplanted from an earlier agreement and its origin is unclear.

[17] It is often the case that the employer bargaining representative in negotiations for an enterprise agreement undertakes the drafting on the basis that the employer has access to the necessary resources to manage this process which may include taking minutes and other records of negotiations which are circulated to all bargaining representatives. There are also steps in the making of enterprise agreements which require the proposed agreement to be circulated and explained. Often this process is undertaken jointly by employer and employee bargaining representatives.

[18] Appropriate cases for the application of the contra proferentem rule may be found where there is clear evidence that an employer has drafted an enterprise agreement and placed it before employees on the basis of “take it or leave it” and those employees have had minimal if any involvement in the negotiations, or where it can be established that the employer has drafted documentation used to explain an ambiguous term and circulated that documentation to employees. 24 In such cases it can be said that an employer party to an enterprise agreement should not be able to avoid an obligation in an enterprise agreement on the basis of reliance on a particular resolution of the ambiguity.25

[19] In short, I do not accept that the contra proferentem rule should be applied to resolve any ambiguity in the terms of an enterprise agreement simply because the employer party to the agreement drafted the clause or caused it to be included in the agreement.

THE DISPUTED CLAUSE AND RELEVANT FACTS

[20] The agreement clause on which the dispute centres is clause 3.3(i) which provides as follows:

3.3 Wages

(i) Where an employee as Level 1 is promoted to Level 2 they will receive the next rate in the structure for Level 2 which is a minimum of 5% higher than their current rate of pay.

[21] Relevant facts that are not disputed are as follows:

1. The Applicant is an employee organisation registered under the provisions of the Fair Work (Registered Organisations) Act 2009 (Cth). The Applicant can, by its registered rules, represent the industrial interests of ‘employees working on river and harbour vessels, including ferries’.

2. The Respondent is a National System Employer within the meaning of that term in section 14 of the Fair Work Act 2009 (Cth). The Respondent is engaged in the provision of ferry services on the Brisbane River and employs National System Employees as defined in section 13 of the FW Act, some of whom are members of, and entitles to be represented by, the Applicant Union.

3. The parties are covered by the Transdev Queensland (Ferry) Enterprise Agreement 2015-2017 and were covered by the predecessor to the 2015 Agreement, the Transdev Queensland (Ferry) Enterprise Agreement 2011-2014.

4. On 16 May 2016 the Fair Work Commission approved the 2015 agreement. It came into effect on 23 May 2016 and has a nominal expiry date of 23 May 2018.

5. Employees of the Respondent employed under the 2015 Agreement are divided into classification levels, being:

a. Level 1 employees who are entry level employees and engaged in ticket selling and cleaning (these employees are referred to as Customer Service Officers);

b. Level 2 employees who are engaged in deckhands; and

c. Level 3, 4 and 5 employees who are engaged as vessel masters.

6. Following the approval and coming into effect of the 2015 Agreement, the parties became aware that certain base rates of pay set out at clause 3.3 of the 2015 agreement fell below the base rate of pay provided by the Ports, Harbours and Enclosed Water Vessels Award 2010. Specifically, the base rates of pay for employees at classification levels 1.1-1.4 and 2.1 of the 2015 Agreement fell below the base rate of pay provided by the Award.

CFMMEU EVIDENCE AND SUBMISSIONS

[22] The CFMMEU provided examples of Level 1 employees who had been temporarily and permanently promoted. Those employees who have been permanently promoted are now paid at the rate of 5% above their previous hourly rate. Ms Smith stated that she was permanently promoted from Level 1 to Level 2 and then demoted by choice to Level 1. When that employee acts in a higher position from time to time, her base rate of pay does not change and she is paid the Award rate of pay for Level 1 on the basis that the Award rate is higher than the Agreement rate for that Level. Ms Smith contends that the duties of deckhand at Level 2 require more skills than those she exercises as a ticket seller (CSO) and that she should be paid at a higher rate when she performs such duties.

[23] Employees who provided statements in support of the CFMMEU’s case stated that their belief was that any Customer Service Officer who was promoted – either permanently or temporarily – from Level 1 to Level 2 is entitled to the higher rate of pay. Ms Bawden stated that prior to the 2011 Agreement, casual and permanent ticket sellers who worked a shift as a deckhand were paid at the full deckhand hourly rate regardless of whether they worked only one shift or multiple shifts. Ms Bawden was the lead negotiator for the earlier 2011 Agreement on behalf of the CFMMEU and states that clause 3.3(i) of the current Agreement was in the same terms as clause 3.3(i) of the previous 2011 Agreement. Ms Bawden states that the primary goal in the negotiations for the 2011 Agreement was to eliminate the differences in the treatment of casual and permanent employees and to make it fairer for employees who wished to occasionally work higher duties by remain in their substantive roles.

[24] Ms Bawden thinks Transdev’s representatives came up with the wording of clause 3.3(i) and it was inserted as a proposed clause without any discussion or negotiation. Ms Bawden further stated that clause 3.3(i) in her mind was designed to clarify the increase that a Level 1 Ticket Seller was entitled to when performing a higher duties shift as a deckhand and at no time was it discussed or agreed that this promotion had to be permanent. Ms Bawden’s understanding was that “promotion” to higher duties could be for one shift or many and did not have to be full time.

[25] In relation to clause 3.1(d) of the 2011 Agreement, Ms Bawden said that this clause in her mind was designed to ensure people were paid at the rate for the job they undertook and that this did no more than reflect the practice that was already in place. At no time was it discussed or agreed that employees would be paid at their designated classification level for a higher duties shift. It was recognised that increases in hourly rates was appropriate for performing higher duties. Ms Bawden also said that Transdev representatives came up with the wording of clause 3.3(i) and if they had intended that it apply only to permanent promotions, this should have been discussed with employees. No such statement was made to employees in the negotiations.

[26] With reference to the principles relevant to the construction of enterprise agreements, the CFMMEU submits that clause 3.3(i) of the Agreement includes a situation where an employee is temporarily promoted into a Level 2 role, entitling the employee to the Level 2 rate of pay for the duration of the time they are working in the Level 2 role.

[27] The CFMMEU contends that the meaning of the work “promoted” is broad enough to encompass the type of temporary promotion that occurs when a Level 1 employee is required to complete the duties, and therefore operate as a Level 2 employee. The CFMMEU concedes that the term “promoted” is ambiguous and susceptible to more than one meaning. The CFMMEU cited a number of cases where the term “promoted” has been found to refer to a promotion of a temporary nature 26. The CFMMEU also highlighted that there is a lack of authority indicating that the term “promoted” only refers to a promotion of a permanent nature. In the alternative, the CFMMEU submits that the ambiguity around the meaning of “promoted” does not preclude a construction of the clause as applying to temporary promotion.

[28] In support of this contention, the CFMMEU submits that the ordinary or plain meaning of the word “promote” does not assist in interpreting clause 3.3(i) of the Agreement, and that the word “promote”, on its ordinary meaning, is capable of referring to a temporary promotion. The CFMMEU also points to the general understanding of employees as to the intended operation of the clause to the effect that it applied to situations where employees temporarily operated in a higher role for a limited period of time before returning to their original role.

[29] In relation to context within the Agreement, the CFMMEU states that other clauses in the Agreement are of little value in interpreting the intended meaning of clause 3.3(i). Clause 3.1, which sets out the broad framework in which the classification structure (and subsequently the remuneration structure) operates, has flexibility as its overriding purpose. Clauses 3.1(d) and 3.1(f) state:

3.1(d) Employees working at a higher classification level for temporary relief shall be paid at the rate of pay applicable for the higher classification level for the time worked at that level.

3.1(f) The Employer has absolute discretion on the promotion or temporary use of an employee in a high skilled position. The employer, with all other things being equal, shall take into account length of experience with the Company when promoting an employee.

[30] The CFMMEU also submits that an employee working at a higher classification level should be remunerated accordingly, with clause 3.3(i) and 3.1(d) being treated as complementary and read together. In relation to clause 3.1(f) the CFMMEU submits that this clause is not instructive in interpreting clause 3.3(i) as it is capable of multiple meanings and is contained in a section of the Agreement that is aimed at setting out a general framework for the Agreement. Further, the CFMMEU submits that the absence of a comma in clause 3.1(f) “lends itself to a tautological interpretation”.

[31] The Commission, by applying a generous construction over a strictly literal approach, should conclude that promotion can be of a temporary nature as well of a permanent nature. The CFMMEU submits that as Transdev inserted the whole of clause 3.3(i) into the proposed 2011 Agreement, and by inference drafted the clause, the Commission should apply the contra proferentem doctrine and construe the term contrary to the contentions of Transdev. In this regard the objective background facts support the contention that there was no discussion or negotiation about either clause 3.3(i) or the wording proposed for that clause and that Transdev inserted the proposed wording. In those circumstances the Commission should consider that if Transdev had intended to limit the application of the clause to employees permanently promoted it could have drafted the clause in a way that made this clear or made its view known during the negotiations. Employees should not bear the consequences, in the form of real economic loss, from the failure of Transdev to articulate what it now claims to have been its intention all along.

[32] In summary, the CFMMEU asserts that:

● The word “promoted” in clause 3.3(i) of the Agreement means both temporary and permanent promotion;

● The dictionary definition of “promote” is not instructive, but does not preclude a temporary state;

● Clauses 3.3(i) and 3.1(d) are complementary and should be read together;

● The apparent separation of “promotion” and “temporary use” in clause 3.1(f) is not instructive as it is capable of two meanings and in any event appears in a separate section of the Agreement which is more concerned with setting a general framework than the specific matters dealt with in clause 3.3;

● The evidence suggests that the only discussion in relation to clause 3.3 during negotiation of the 2011 Agreement was in relation to specific base rates of pay. Clause 3.3(i) was not discussed and the precise wording of the clause was not discussed;

● Transdev drafted clause 3.3(1) and inserted it into the proposed 2011 Agreement without discussion or negotiation;

● The Commission should apply the contra proferentem doctrine; and

● The employees understood “promoted” in the clause 3.3(i) sense to mean both temporary and permanent promotion from level 1 to level 2 considering the context in which they worked on a daily basis.

TRANSDEV SUBMISSIONS

[33] Transdev submits that clause 3.3(i) of the Agreement only applies to employees permanently promoted from Level 1 to Level 2. This interpretation is to be preferred based on the principles of interpretation applied to enterprise agreements and evidence of past practice in the business. Transdev contends that the original dispute as notified by the CFMMEU related to whether the 5% uplift is calculated by reference to rates in the Agreement or the rates in the Award that were paid to employees as a result of an underpayment issue that arose during the life of the Agreement. The CFMMEU does not contend in the dispute notification that the 5% uplift applies to employees other than those permanently promoted from Level 1 to Level 2. Transdev also contends that the interpretation advanced by the Union in relation to the promotion issue arose only after Transdev confirmed that it had decided to pay employees permanently promoted from Level 1 to Level 2 the 5% uplift calculated on the basis of their previous rate, compared to the minimum Award rate, without conceding that it was required to do so.

[34] In relation to the principles relevant to the task of interpreting an enterprise agreement, Transdev submits that the starting point is the plain words of the provision and that consistent with the observations of Madgwick J in Kucks v CSR 27 ordinary or well understood words are in general to be accorded their ordinary or usual meaning.28 Transdev accepts that given the dispute has arisen the clause is susceptible to more than one meaning.

[35] Transdev submits that clause 3.3(i) must be read in context and points to the fact that the clause is one of a number in the Agreement that deal with circumstances where an employee is working in a role other than their substantive role. Transdev does not refute the assertion that an employee who works outside their substantive role are, on occasion, entitled to increased remuneration as a result, however this requires an understanding of the particular circumstances involved with the individual employee and the role or roles they are filling. In this regard clause 3.1(d) (Higher Duties) deals with employees working temporarily in a higher role as follows:

“3.1(d) Employees working at a higher classification level for temporary relief shall be paid at the rate of pay applicable for the higher classification level for the time worked at that level.”

[36] Clause 3.4(d) deals with employees undertaking dual duties as follows:

“3.4(d) Dual Duties Rates:

(i) An employee is entitled to be paid Dual Duties Rates for any time, rounded up to the nearest half hour, where an employee is required to perform the duties of another employee as well as their own because other employee is unexpectedly absent for part or all of their rostered work time.

(ii) Dual Duties Rates are the sum of the employee’s loaded hourly rate, plus the absent employee’s ordinary rate.

(iii) To avoid any doubt, Dual Duties Rates do not apply where:

a. An employee is rostered to perform duties that fall under more than one classification in clause3.2;. Note – CityFerry Masters undertaking Level 3 or Level 4 roles are not required to be paid Dual Duties.

b. The Employee and the absent Employee were rostered to perform either the same duties, or duties that fall within the same classification in clause 3.2;

c. The Employee is not directed to perform the absent Employee’s duties;

d. The Employee performs only part of the absent Employee’s duties; or

e. The Employee is directed to not perform their originally rostered duties and instead perform the absent Employee’s duties

Example: A ticker seller does not turn up for their rostered shift for 25 minutes and the Deck Hand is required to perform dual duties of ticker selling and deckhand, then the deck hand in addition to his or her hourly rate will receive the ticket sellers ordinary hourly rate plus their own for 30 minutes.”

[37] Transdev also refers to clause 3.1 of the Agreement as setting out the intention of the parties with regards to the operation of the classification structure including that employees may be required to perform work that falls within their substantive classification and work at higher or lower levels as required (clause 3.1(c)) and that employees will remain at their substantive classification level until they are assessed as competent and qualified to move up the classification structure (clause 3.1(e)). Crucially, Transdev points to clause 3.1(f) which states:

“3.1(f) The Employer has absolute discretion on the promotion or temporary use of an employee in a high skilled position. The employer, with all other things being equal, shall take into account length of experience with the Company when promoting an employee.”

[38] Transdev submits that clause 3.1 expressly differentiates between a promotion or permanent assignment to a higher role and temporary use of an employee in a higher classified position. The combination of the Higher Duties and Dual Duties clauses and clause 3.3(i) cover all situations in which an employee is working in a higher classification:

● For unforeseen and very short term periods where an employee works in effectively two classifications, the Dual Duties clause applies;

● For longer term but still temporary periods where an employee acts in a higher classification, the Higher Duties clause applies;

● Where an employee is promoted to a higher classification clause 3.3(i) applies.

[39] Transdev further submits that when clause 3.3(i) is read in the context of clauses 3.4(d) and 3.1(d) it is clear that clause 3.3(i) refers to a permanent promotion into a higher role, and does not refer to a temporary promotion into a higher role, as clauses 3.4(d) and 3.1(d) apply in those circumstances. The CFMMEU submission that the absence of a comma in clause 3.1(f) “lends itself to a tautological interpretation” is also said by Transdev to be a departure from the approach set out in the authorities cited by the Union with apparent approval in its submissions.

[40] Transdev submits that the inclusion of the word “permanent” in clause 3.3(i) is not necessary as “promote” is easily understood as denoting a move from one substantive role to a higher substantive role and does not refer to temporarily acting in a role in circumstances covered by either the higher duties or the dual duties clause. It is further submitted by Transdev that the assertion by the CFMMEU that the dictionary definition of “promote” does not preclude temporary promotion is disingenuous. Such an interpretation does not accord with the principles set out in the various authorities which require that the Commission start with the plain words of the clause and applying a common understanding of their meaning.

[41] According to Transdev, the submission that the Commission should apply a legal doctrine – the contra proferentem doctrine – in lieu of examining the plain words of the relevant clause in context requires the Commission to apply an overly technical approach to interpretation. In relation to the evidence of witnesses called by the CFMMEU, Transdev submits that the statements are principally concerned with the base rates issue. Further, the submission that the relevant clause was inserted by Transdev without any discussion or negotiation appears to ignore the fact that employees received a copy of the Agreement during the required access period and it was subsequently approved by those employees.

[42] Transdev also submits that the fact that there is no record of any discussion regarding this specific clause is an indication that it was considered uncontroversial. In relation to Ms Bawden’s evidence, the CFMMEU submits that Ms Bawden is simultaneously claiming that there was no discussion or negotiation about clause 3.3(i) and that the interpretation contended for the CFMMEU is correct because there was no discussion. According to Transdev evidence of other employees about the operation of clause 3.3(i) is simply indicative of their personal beliefs and views, and should not be given weight.

[43] In relation to past practice with respect to the implementation of clause 3.3(i), Transdev submits that there have been no previous disputes regarding underpayment, which it submits is an indication of the common view the parties have had as to how the clause was intended to operate. This is further highlighted by the process in which the Respondent applies this clause via their payroll processes, which require a new employment contract that shows an employee moving into a higher substantive role on a permanent basis.

CONSIDERATION

[44] The starting point is the words of the disputed clause and in particular the meaning to be given to the term “promoted”. In the context of employment, that term commonly means raising a person to a higher rank or position. The concept of promotion carries with it permanency so that in order to reduce the position or rank of a person who has been promoted, it is necessary that the person is demoted. The term “promoted” does not connote an ad hoc arrangement where the person acts temporarily in a higher role.

[45] On the face of clause 3.3(i), there is no ambiguity and the uplift in rate applies where a person has been raised to a higher level on an ongoing basis. I do not accept that the fact that the dictionary definition of the commonly understood term “promoted” does not exclude temporary promotion, is a basis for construing the term in the manner contended for by the CFMMEU.

[46] It is then necessary to consider the text of the Agreement viewed as a whole and the place of the disputed term in the Agreement to either confirm or displace the apparently plain meaning of the term “promoted”. The text of the Agreement as a whole supports a construction where the term “promoted” means a permanent rather than a temporary arrangement whereby an employee at Level 1 is given a position on an ongoing basis that entitles the employee to be classified at Level 2. This is so because clause 3.1(f) of the Agreement gives the employer absolute discretion on the promotion or temporary use of an employee in a higher skilled position. This clause makes it apparent that there is a distinction between promotion and temporary use of employees in higher positions. There is nothing in clause 3.3(i) to suggest that there is a basis to construe the term “promotion” on the basis that it means something different from the distinction in clause 3.1(f) between employees who are promoted or used temporarily in higher skilled positions. I do not consider that the absence of a comma in clause 3.1(f) changes the plain meaning of the clause.

[47] It is also the case that the inclusion of provisions in the Agreement for higher duties and dual duties payments makes it likely that employees temporarily acting in higher level positions are entitled to be paid at higher rates by virtue of those provisions than by virtue of the terms of clause 3.3(i) of the Agreement. In this respect I accept the submissions for Transdev to the effect that the combination of the Higher Duties, Dual Duties and the promotions clause cover all circumstances where an employee is working in a higher classification.

[48] In light of the fact that the Agreement has a plain meaning evidence of the surrounding circumstances will not be admitted to contradict that meaning. Even if evidence of the surrounding circumstances is admitted, the evidence does not establish objective background facts sufficient to establish that an alternative interpretation should be preferred so that the ordinary or plain meaning of the term “promoted” is not applied. The views of witnesses for the CFMMEU about the meaning of the disputed clause are not evidence of background circumstances that establish objective background facts. Rather, they are views of employees reflective of their actual intentions and expectations.

[49] I also do not consider that this is an appropriate case for the application of the contra proferentem rule. In this regard I do not accept that the evidence establishes that Transdev placed the disputed term before employees so that there was no negotiation. The disputed term was in a previous iteration of the Agreement. There is evidence of negotiations about the Agreement and that employees voted to approve it after negotiations.

CONCLUSION

[50] In conclusion in relation to Question 1, I do not accept that clause 3.3(i) applies to employees who are temporarily promoted to perform Level 2 duties as well as employees permanently promoted to perform Level 2 duties. In these circumstances it is not necessary to answer Question 2.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

<PR608028>

 1   Statement of Robert Carnegie dated 5 March 2018.

 2   Statement of Robert John Sanderson dated 5 March 2018.

 3   Statement of Robin Kay Smith dated 1 March 2018.

 4   Statement of Yvette Bawden dated 28 February 2018.

 5   Statement of TimothyMark Warburton dated 28 February 2018.

 6   Witness Statement of Kirsty Hammond dated 19 March 2018.

7 [2017] FWCFB 3005 at [14].

 8 Kucks v CSR Ltd (1996) 66 IR 182

 9   [2017] FWCFB 4487.

 10 [2014] NSWCA 184 at [71] – [85].

 11   Manufacturers’ Mutual Insurance Ltd v Withers (1988) 5 ANZ Ins Cas 60-853 at 75-343.

 12   Kirin-Amgen Inc v Hoechst Marion Roussel Ltd [2004] UKPC 6; [2005] 1 All ER 667 at [64].

 13   Project Blue Sky v Australian Broadcasting Authority [1998] HCA 28; 194 CLR 355 at [78].

 14   Charter Reinsurance Co Ltd v Fagan [1997] AC 313 at 391 per Lord Hoffman, approved in Campbell v R [2008] NSWCCA 214; 73 NSWLR 272 at [48] (Spiegelman CJ, Weinberg AJA and Simpson J agreeing) and Dale v The Queen [2012] VSCA 324 at [73].

 15   Franklins Pty Ltd v Metcash Trading Ltd [2009] NSWCA 407; 76 NSWLR 603 at [17] cited in Mainteck Services Pty Ltd v Stein Heurtey SA (2014) 310 ALR at [71] – [85].

 16   Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; 219 CLR 165 at [40].

 17 [2010] FCA 688 at [45].

 18   [2016] FWC 5052 at [85].

 19 (1924) 35 CLR 14.

 20   Ibid at paragraph 45 citing Fowkes v. Manchester and London Assurance Association (1863) 3 B. & S. 917, 122 E.R 343.

 21 [2001] FCA 32.

 22   Ibid at [47] citing Tam Wing Chuen v Bank of Credit and Commerce Hong Kong Ltd [1996] 2 BCLC 69 per Lord Mustill at page 77.

 23   [2016] FWC 5052.

 24   See for example AWU v James Hardie Pty Ltd [2001] QIC 34 (12 July 2001); 167 QGIG 280 where Hall P held that an ambiguity should be resolved against the employer who was seeking to avoid an obligation in reliance on an ambiguity, in circumstances where an explanatory document which was ambiguous drafted by agents of an employer to explain an ambiguous term in an agreement, was given to employees who were laypersons.

 25   Ibid per Hall P.

 26   The Police Association v Victoria Police Force[2006] AIRC 610; Industrial Relations Commission Decision 2373/1995 [1995] AIRC 2180 and BP Oil (Kwinana) Refinery Pty Ltd AWU Award 1992 – re Award simplification [2001] AIRC 993

 27 (1996) 66 IR 182

 28   Ibid at 184.