[2019] FWC 2825

FAIR WORK COMMISSION

DECISION

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

Construction, Forestry, Maritime, Mining and Energy Union
v
BHP Coal Pty Ltd
(C2018/2083 & C2018/4418 )

DEPUTY PRESIDENT ASBURY

BRISBANE, 13 MAY 2019

Alleged dispute about any matters arising under the enterprise agreement and the NES; [s186(6)]

BACKGROUND

[1] The Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU) applies under s. 739 of the Fair Work Act 2009 (the Act) for the Fair Work Commission to deal with a dispute in accordance with a dispute settlement procedure in the BMA Enterprise Agreement 2018 (the 2018 Agreement). The dispute arose at the Goonyella Riverside Mine (GRS) and relates to the process for introducing roster changes at the mine. GRS is operated by BHP Billiton Mitsubishi Alliance (BMA) and the employer of the employees to whom the dispute relates is BHP Coal Pty Ltd (BHP). For ease of reference I will refer to the Respondent as BMA.

[2] The dispute has been the subject of two applications made by the CFMMEU under s. 739 of the Act with the first application having been made in relation to the BMA Enterprise Agreement 2012 (the 2012 Agreement) and the second application in relation to the 2018 Agreement. The 2012 Agreement covered employees of BHP at GRS from October 2012 until 28 May 2018. Since 28 May 2018 the employees have been covered by the 2018 Agreement. The dispute concerns the operation of clause 11.5 of the 2018 Agreement (which is in identical terms to clause 11.5 of the 2012 Agreement) and its interaction with clause 14 of the 2018 Agreement (which is in identical terms to clause 14 of the 2012 Agreement). BMA has sought to introduce new rosters for draglines and coal production at GRS and those rosters are in the process of being trialled or implemented.

[3] The parties disagree as to the correct interpretation and application of clause 11.5 of the 2018 Agreement and BMA’s use of that clause to trial and implement new or changed rosters. The CFMMEU contends that the clause can only be used to implement rosters which are sought or initiated by employees to meet their preferred lifestyle arrangements. The CFMMEU also contends that neither of the rosters subject of the present proceedings purports to be, or is, for that purpose. The CFMMEU makes a further or alternative contention that in both instances BMA was required to follow specific processes which have not been followed. The CFMMEU submits that if either claim is correct, BMA did not have the ability to implement a number of rosters currently in operation at GRS.

[4] BMA contends that clause 11.5 of the 2012 Agreement and later the 2018 Agreement entitles it to introduce new rosters to meet changing business needs and that the use of the clause is not limited to rosters initiated by employees. BMA further contends that the proper process has been followed to introduce the rosters subject of the present dispute.

[5] The parties have agreed on a statement of facts and questions for arbitration. These are set out below. A hearing was conducted on 14 December 2018. Evidence for the CFMMEU was given by:

• Mr Andrew Vickers, former General Secretary of the Mining and Energy Division of the CFMMEU;¹ and

• Mr Simon West – President of the CFMMEU Lodge at GRS.²

[6] BMA objected to some of the evidence of Mr Vickers and Mr West. It was agreed that certain paragraphs of Mr West’s first witness statement were to be admitted for illustrative purposes only and that BMA did not concede that they were accurate or factual. BMA also contended that statements of opinion or law in the statements of both witnesses should not be given weight by the Commission. Mr Vickers and Mr West were both cross-examined.

[7] Evidence was given for BMA by the following persons:

• Mr Shaun McKenzie, former Human Resources Manager for BMA;³

• Mr Peter Stelmach, former Manager Employee Relations for BMA;⁴ and

• Mr Matthew Brady, Vice President Global Assets for BMA.⁵

[8] Mr Stelmach and Mr Brady were cross-examined. Mr McKenzie’s witness statement was tendered without objection and he was not required for cross-examination.

AGREED STATEMENT OF FACTS AND QUESTIONS FOR ARBITRATION

[9] The Agreed Statement of Facts and questions for arbitration are as follows:

“1. This dispute arises in relation to the correct process for introducing changes to roster arrangements at a mine. The parties have agreed the following facts only for the purposes of this matter.

Background

2. BMA Billiton Mitsubishi Alliance owns a number of open cut coal mines located in the Bowen Basin.

3. It is the operator of the mines.

4. BHP Coal Pty Ltd (BMA) is the employing entity.

Regulatory context

5. From October 2012 to 28 May 2018, employees of BMA at the relevant mine were covered by the BMA Enterprise Agreement 2012 (EA 2012).

6. Since 28 May 2018 those employees are covered by the BMA Enterprise Agreement 2018 (EA 2018).

7. The CFMMEU is covered by both Agreements.

8. In each Agreement, clause 11.5 is in exactly the same terms. The clauses deal with introduction and changes to rosters.

9. Clause 11.5 first appeared in its present form in EA 2012. A copy of the terms of clause 11.5 (as it appears in the current EA) are set out below:

11.5 Introduction of New Rosters and Changes To Roster Arrangements

The Company may introduce new rosters to meet the needs of the business and in so doing, will follow the process in this clause that facilitates changes in roster arrangements which affect existing Employees.

The parties acknowledge that there are a number of Employees who have genuinely and voluntarily adopted a commute lifestyle. These Employees normally reside remote from the Mine at which they are employed where not rostered to work and commute to the Mine of their employment for rostered-on shifts, before returning to their usual place of residence, on completion of their rostered shift cycle.

It is also acknowledged that Employees may be interested in working a different roster arrangement than those which have been developed and agreed to match the more traditional residential based lifestyle, where Employees reside in towns that service the Mine at which they are employed.

This clause 11.5 will not be used to introduce changes to Roster Arrangements, unless it is identified that a significant number of Employees desire such changes.

In the event that agreement with the majority of affected Employees, as provided for in clause 14, is not reached, the following processes will apply.

(a) In the event that the Company seeks to introduce a different roster to facilitate Employees' preferred lifestyle arrangements the Company may trial and implement such new rosters in accordance with the requirements of the Continuous Improvement Clause (clause 14) of this Agreement, in addition to the specific requirements of this sub clause.

(b) The Company will first gauge the support for changed roster arrangements amongst affected Employees in the "relevant work area" and other work areas working similar rosters where similar skills and competencies are utilised. In this clause 11 .5(b):

(1) "gauge" means a genuine attempt to determine the view of the majority of the affected Employees about proposed different roster(s) and their existing roster; and

(2) A "relevant work area' means the work area in which the roster will be implemented as determined by the Company. The relevant work area may be any suitable Employee grouping, for example, an entire functional work area, a sub set of a functional work area, a single crew or other grouping. There will be no limitation on what the Company determines to be the relevant work area, however, 'relevant work area' is not intended to refer to the whole of a Mine and does not mean individual Employees.

(c) The information gained from the procedure in clause 11.5(b) will be incorporated in the "business reasons" for the proposed change to roster arrangements.

(d) In the event that an Employee, as a consequence of this process to introduce changed roster arrangements, is required to change from their current roster arrangement. the Employee may provide the Company with an expression of interest (EOI) to transfer to another work area which works the Employee's current roster. The EOI period will open at the commencement of the implementation of a trial of the changed roster arrangement and remain open for one month after full implementation of tile roster, following any trial period.

(e) Following any trial period. the Company will process EOI applications and seek to accommodate suitable alternative rosters for Employees as expeditiously as reasonably practicable, including but not limited to, transferring Employees between relevant work areas, where they have the majority of the relevant skills for the roles In the work areas to which they are seeking to be transferred, to accommodate a suitable alternative roster. The Company will process EOI applications earlier in exceptional circumstances, for example, where an Employee is unable to obtain childcare.

(f) The selection process at clause 8.3 will be used to effect the transfer of Employees to give effect to Employee EOIs under this Clause. Where an Employee has the majority of relevant skills for the work area to which transfer is sought, the Employee will have preference over any other candidate whether internal or external. ·

(g) The right of an Employee to have their EOI processed under this clause will remain valid until the earlier of the Employee being offered a suitable alternative roster (and either accepting or refusing that offer), the nominal expiry date of this Agreement or the Employee withdrawing their EO I. Once withdrawn, an EOI cannot be resubmitted.

10. In clause 11.5 reference is made to clause 14.

11. In each of the EA 2012 and EA 2018, clause 14 is in exactly the same terms. A copy of clause 14 as it appears in the EA 2018 is set out below:-

14 Continuous Improvement

Where the Company proposes a change to work practices and/or arrangements, the following will occur:

(a) The affected Employees and, if they request, their Employee Representatives will be notified of the proposal, In writing, by the Company, which will include the business reasons supporting the proposals, as well as the necessary duration for gaining the required evidence for evaluating the success of the trial. A genuine attempt will be made by all parties to reach an agreement.

(b) If the majority of affected Employees agree, the proposal will be implemented.

(c) If there is no agreement, the Company may elect not to proceed with the proposal.

(d) If the Company elects to proceed, a trial may be implemented for a maximum period of up to six months depending on the nature of the proposal.

(e) At the end of the trial period either of the following may occur: either

(1) the Company decides not to proceed with the proposal;

(2) there will be full implementation.

(f) If once the Company has decided to implement a trial, the affected Employees are of the view that the trial is having/may have an effect on them, that is harsh, unreasonable or unjust, the affected Employees or if requested, their Employee Representatives, may progress the dispute to FWA in accordance with the final step of the Dispute Settlement Procedure in clause 37.16 to seek to have the trial cease or amended or not proceed because of the existence of such an effect. Each party to the Agreement agrees to accept the outcome of the Dispute Settlement Procedure.

This provision is not to be used to preclude a trial from proceeding or continuing merely because the trial represents a change to previous circumstances, may involve a reduction in Employee earnings, or may be deemed to constitute a perceived inconvenience to Employees. This provision is only to be used to argue that the effect of any trial is so unreasonable as to be contrary to the spirit of continuous improvement.

(g) Notwithstanding (f) above, during the last four weeks of any trial, an affected Employee or if requested, their Employee Representative, may refer any disputed issue connected to the trial to FWA through the final step of the Dispute Settlement Procedure. Each party to the Agreement agrees to accept the outcome of the Dispute Settlement Procedure.

(h) This provision will not be used to permit a proposal to be trialled which would involve a breach of occupational health and safety regulations.

(i) It is not the intention of this provision to reduce award standards or the terms and conditions of employment specified in this Agreement.

(j) The term "business reasons" as referred to in (a) above means an overview of the key financial and/or efficiency benefits that will accrue to the mine from the proposal. It does not mean a detailed business case.

12. Clause 14 first appeared as clause 16 (in slightly different terms) in the BMA Coal Pty Ltd Enterprise Agreement 2001. A copy is attached in Schedule A.

Background Drag line Roster Change

13. On or about February 2018 the Respondent sought to introduce a new roster for employees of the drag lines at Goonyella Riverside.

14. A copy showing the rosters is attached in Schedule B.

Background to Coal Production Roster Change

15. On or about May 2018 the Respondent sought to introduce a new roster for Production Coal crews in Coal Mining, Mine Services, and Processing.

16. The relevant rosters are the same as those in Schedule B.

Questions for Arbitration

Qu.1 How is a "relevant work area" determined?

Qu.2 In a situation where there is a significant number (whatever that number may be) of employees who support the roster change, what process should BMA follow under the EA to introduce a trial of the roster?

Qu.3 Would a return of 16 formal votes in favour, and 27 formal votes against, the implementation of the proposed new roster out of a total of 45 employees in Drag lines constitute a "significant number" of employees for the purposes of clause 11.5 of the 2012 EA and the 2018 EA?

Qu.4 Would a return of formal votes as follows constitute a "significant number" of employees for the purposes of clause 11.5 of the 2012 EA and the 2018 EA:

(a) 5 formal votes in favour, and 1 0 formal votes against, the implementation of the proposed new roster out of a total of 23 employees in Mine Services;

(b) 10 formal votes in favour, and 31 formal votes against, the implementation of the proposed new roster out of a total of 42 employees in Processing;

(c) 44 formal votes in favour, and 61 formal votes against, the implementation of the proposed new roster out of a total of 106 employees in Coal Mining;

(d) 59 formal votes in favour, and 102 formal votes against, the implementation of the proposed new roster out of a total of 171 employees in Production Coal?

THE APPROACH TO THE CONSTRUCTION OF ENTERPRISE AGREEMENTS

[10] The approach to the construction of industrial instruments such as enterprise agreements was most recently summarised 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 Ltd⁶ (Berri) 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 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.”

[11] In CFMEU v Endeavour Coal Pty Ltd T/A Appin Mine⁷ a 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 SA⁸ emphasising 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 means⁹ and there is always some context to any statement;¹⁰

• Language considered in its context will often have a clear meaning and context will often not displace that meaning – “but not always”;¹¹

• 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;¹²

• The phrase “if the language is ambiguous or susceptible of more than one meaning” used by Mason J in Codelfa 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;¹³ 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 transaction¹⁴

[12] The case law in relation to the approach to the construction of enterprise agreements makes it clear that context and purpose are relevant to the construction of provisions in an enterprise agreement and must be considered even where the words of the provision being construed appear, on their face, to have a clear and unambiguous meaning. The following observations of Madgwick J in Kucks v CSR are also apposite in the present case:

“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. Deciding what an existing award means is a process quite different from deciding, as an arbitral body does, what might fairly be put into an award. So, for example, ordinary or well-understood words are in general to be accorded their ordinary or usual meaning.”¹⁵

[13] In the present case I have given detailed consideration to the evidence about the negotiations for the 2012 Agreement. My reasons for doing so are that those negotiating and implementing the 2012 Agreement are experienced participants both in the Fair Work Commission and its predecessors. They are also experienced and skilled negotiators. Unfortunately they do not agree about what they negotiated. Notwithstanding this, I do not doubt their credit as witnesses and accept that their views about what was negotiated are honestly and genuinely held. However, as set out by the Full Bench of the Commission in Berri it is well established that evidence of negotiations is relevant to establish objective background facts known to all parties; the subject matter of the 2012 Agreement and matters in common contemplation constituting a common assumption. Evidence about intention and negotiation strategies and objectives cannot be used to contradict the plain meaning of the text an enterprise agreement.

EVIDENCE AND SUBMISSIONS

CFMMEU

[14] The CFMMEU submits that clause 11.5 relates to both the introduction of new rosters and changes to rosters. It was introduced as part of the “protracted and difficult process” of negotiating the 2012 Agreement.¹⁶ Clause 14 sets out the process which is to be followed when a change to work practices or arrangements is proposed. Clause 14 first appeared as clause 16 of the BMA Coal Pty Ltd Enterprise Agreement 2001, albeit in slightly different terms. Before the introduction of clause 11.5, the process provided by clause 14 was the process for changing rosters. A majority of employees was required to vote for a change before it could be made.

[15] The CFMMEU contends that clause 11.5 of the 2018 Agreement can only be used to facilitate employee’s preferred lifestyle arrangements and that neither of the rosters subject of the present proceedings purports to be or are for that purpose. The CFMMEU makes a further or alternative contention that in both instances, BMA was required to follow specific processes which have not been followed. If either claim is correct, the CFMMEU contends that BMA did not have the ability to implement a number of rosters currently in operation at GRS.

[16] The CFMMEU submits that based on the agreed statement of facts, the Commission can proceed on the basis that:

• On or about February 2018 BMA sought to introduce a new roster for employees on draglines at GRS (dragline roster change); and

• On or about May 2018 BMA sought to introduce a new roster for production coal crews in coal mining, mine services and processing (production roster change).

[17] The CFMMEU referred to evidence from Mr West to indicate its understanding of the processes followed by BMA in making the dragline roster change and the production roster change. It was agreed between the CFMMEU and BMA at the hearing that Mr West’s evidence in relation to these matters and events would be admitted for illustrative purposes only and treated as examples of certain conduct.¹⁷ In relation to the dragline roster the CFMMEU submits (on the basis of Mr West’s evidence) that:

• In or around December 2017, BMA informed employees about the proposed changes and members of the CFMMEU requested that Mr West be their employee representative for the following process on or around this time;

• On 1 February 2018 the CFMMEU notified BMA that Mr West was the relevant employee representative and a request was made for written notification of proposed changes which was not provided;

• A vote was then conducted on the proposed roster with 35.8% the relevant employees voting in favour of the roster change;

• In early March 2018, BMA notified relevant employees that the roster change would be trialled;

• On 25 March 2018 a trial of these roster changes commenced across the entire dragline departments;

• On 24 September 2018 these roster changes were implemented and employees were advised that they could lodge an expression of interest (EOI) to transfer to another work area;

• The purpose of the change was “to reduce handovers and allow for a continuous allocation of tasks”.¹⁸

• On 9 March 2018 the CFMMEU commenced a dispute in accordance with the dispute settlement procedure in the 2012 Agreement. On 19 April 2018 the CFMMEU lodged the first application. On 28 May 2018 the 2018 Agreement came into operation, and was predominantly a rollover of the 2012 Agreement.

[18] In relation to the production roster change, the CFMMEU submits (based on Mr West’s evidence) that BMA adopted the following process:

• In or around May 2018 a number of employees became aware that BMA was planning roster changes in the work areas of coal mining, prep plant and mine services;

• A number of employees and Mr West informed BMA that Mr West was an employee representative for the purpose of clause 14(a) of the 2018 Agreement;

• BMA provided Mr West with some material about the proposed changes and engaged in an exchange about the purported business reasons for the changes;

• In or around early June 2018 BMA held a vote of employees in the three work areas combining the vote from each area to get a total of 36% voting in favour of the changes;

• The trial was implemented on 2 July 2018 across all three areas; and

• The purpose of the changes was to improve work continuity and “to reduce handovers and allow for a continuous allocation of tasks.”

• On 14 June 2018 the CFMMEU commenced a dispute in accordance with the dispute settlement procedure in the 2018 Agreement and on 10 August 2018, lodged the second application.

[19] In relation to the meaning and application of clause 11.5 the CFMMEU submits that the clause appears in the context of clause 11 of the 2018 Agreement which deals with “Hours of Work and Rosters” under the subheading “Introduction of New Rosters and Changes to Roster Arrangements”. The CFMMEU also points to the introductory words of the clause which state that in introducing new rosters, “the Company will follow the process in this clause that facilitates changes in roster arrangements which affect existing employees”. The provision establishes that clause 11.5 is the process to be followed when seeking to introduce new or changed rosters and is followed by a set of prefatory remarks which go to the purpose of the provision. The provision is to be used to facilitate changes to rosters “through”accommodating alternate rosters.

[20] These alternative rosters are said to arise from a clause which explicitly considers emerging preference for a commute lifestyle in the context of existing rosters “which have been developed and agreed to match the more traditional residential based lifestyle.” This is supported through the articulation of the first step in the process set out in clause 11.5(a) to (g) being that the Company may seek “to introduce a different roster to facilitate Employee’s preferred lifestyle arrangements”. Rather than it facilitating the change of an entire work area to a new roster clause 11.5 was developed to accommodate both residential and commute workers and contemplated operating multiple rosters across a work area. If the clause is determined to be ambiguous, the CFMMEU points to the circumstances in which the 2012 Agreement was made to assist in the interpretation. These circumstances are said to be the fundamental purpose of the clause and a key aspect of bargaining for the 2012 Agreement when the clause was first introduced.

[21] According to the CFMMEU, clause 11.5 of the Agreement was designed to create a mechanism to introduce a commute arrangement for those employees who wanted it. A qualifier to the use of the clause is the requirement that a significant number of employees desire changes to rosters. The CFMMEU submits that the meaning of the term “significant” in the context it is used in clause 11.5 of the 2012 and 2018 Agreements is “noteworthy, important or consequential”. The use of the word “desire” is said to be similarly instructive and when given its ordinary meaning it should be taken to mean “request” supporting the interpretation that the clause is drafted to facilitate a bottom-up rather than a top-down roster change.

[22] In relation to the process to be followed under clause 11.5 the CFMMEU submits that firstly, where the majority of relevant employees support a roster change the correct process to implement the change is through clause 14 Continuous Improvement. This is evidenced by the fact that the first steps in clause 11.5 are the same steps as set out in clause 14(a). Clause 11.5 then requires that specific steps to introduce a new roster are to occur alongside the trial and implementation steps of clause 14(d) – (j). Once it has been determined that a majority does not support the change the Company is then required to “gauge support” for the changes which means “to make a genuine effort to determine the view of the majority of affected Employees about the proposed different roster(s) and their existing roster” as provided in clause 11.5(b). It is submitted that the use of the word “gauge” and the definition of that term in clause 11.5(b) allows for a more nuanced consideration of each of the rosters than the process used for the determination of the majority.

[23] In relation to what is a relevant work area, the CFMMEU submits that BMA has the discretion to determine a relevant work area as “a work area in which the roster will be implemented” subject to that work area being a “suitable” grouping of employees. The CFMMEU also submits that the term “work area” takes on a particular meaning in this context. It is a term commonly used throughout each of the Agreements and as a well understood concept throughout the Agreement negotiations. Consistent with the evidence of Mr Vickers, the term refers to an identifiable segment of the mine where there is a high degree of commonality between workers. The use of the term “relevant” and the definition provided in clause 11.5(b)(2) qualifies this and the relevant grouping must be “suitable”. Something will be “relevant” where it has a bearing on or has reference to a matter in hand and will be “suitable” where it is well fitted or appropriate for its purpose. The purpose is to accommodate the roster preferences of commute employees and residential employees and the matter in hand is how the Company configures rosters to make that accommodation. Grouping disparate work areas together and determining their combined views on rosters is in no way fit for purpose.

[24] The CFMMEU further submits that there is “no stated use for business reasons” in clause 11.5 and that business reasons are only relevant where employees drive changes under the clause and the Company wishes to rely on business reasons to refuse the changes. This also reiterates that the clause is intended to give effect to bottom up roster changes. In relation to the expression of interest (EOI) process, the CFMMEU submits that it makes up half of the steps set out in clause 11.5 and is intended to have work to do. If BMA’s interpretation of clause 11.5 was accepted the EOI process would be rendered meaningless. This can be seen from Mr West’s evidence in the present case to the effect that the only departments working on the original roster are the drill and blast departments which are small departments where employees require specialised skills. The employees in those departments are not easily interchangeable with employees affected by the roster changes and if even a small proportion of employees forced on to alternative rosters registered an EOI to return to their original rosters BMA would have difficulty accommodating those requests.

[25] The CFMMEU submits that the negotiations for the 2012 Agreement involved extensive bargaining around rosters including clause 11.5 and the need to accommodate commute and residential rosters. As indicated by the evidence of Mr Vickers clause 11.5 was drafted to accommodate employees working both residential and commute rosters. On its proper construction the clause gives BMA the ability to create multiple rosters to suit both lifestyle preferences. This would be impossible under clause 14 which requires majority support for the introduction of a roster. According to the CFMMEU, to suggest that clause 11.5 was introduced to give BMA a new power to force a majority of employees to work a roster they did not support, and without any consideration, must not be accepted. According to the CFMMEU such an interpretation stands in stark contrast to both the industrial context and the evidence including that initially authored and agreed to by BMA.

[26] In relation to the context of the 2012 Agreement, the CFMMEU points to the evidence of Mr Vickers who participated in negotiations for that Agreement. Mr Vickers states in relation to those negotiations that bargaining occurred in a context where the Unions had come to a “latent realisation” that a not insignificant number of members were interested in roster systems that were different to those favoured by the majority and that many members had abandoned living in community arrangements in favour of commuting, even though there was no commute roster at the mines. BMA was also telling the Unions that employees who were commuting were approaching the Company asking for different rosters.

[27] According to Mr Vickers, the Company wanted complete control over rosters and the Unions were concerned at the introduction of a roster system that would facilitate people moving out of mining communities and that there would be adverse impacts on employees working rosters which provided for seven night shifts of twelve hours duration, in a row. Delegates were also advising the Union that the majority of members did not want commute rosters and there was anxiety among members about being forced to work such rosters. The Unions had to balance the fact that so many employees were commuting and wanted an agreement that would recognise both groups by facilitating changes to a roster in a work area or subset of a work area, without forcing employees who were happy with their roster to be disadvantaged. It was in this context that clause 11.5 of the 2012 Agreement was discussed.

[28] Mr Vickers states that the concept inherent in clause 11.5 of the 2012 Agreement is that there should be a pathway for members who were in the minority in a work area or section of a particular mine to move to a roster system which suited their personal preferences, particularly their living arrangements. Mr Vickers also gave evidence about a meeting with Company representatives including Mr Stelmach, on or around 5 and 6 December 2011 during which continuous improvement and roster issues were a focus. Mr Vickers tendered a letter sent to him by Mr Stelmach after the meeting including proposed wording for provisions addressing these issues. The letter tendered by Mr Vickers is dated 9 December 2011 and refers to discussions on 5 and 6 December 2011 regarding the continuous improvement provision and the hours of work and roster arrangements. The letter contains the following paragraphs under the heading “BMA’s operations”:

“As we have discussed with you during these meetings, BMA operates what have increasingly become ‘Residential operations with a commute option’. We estimate approximately 30-40% of our employees currently commute from outside locations.

In order for BMA’s business to remain competitive, particularly from the perspective of retaining existing employees, we need work rosters that provide a balance between the needs of residential employees and those who elect to commute.

By providing such rosters we can make commuting safer and this coupled with more flexible housing arrangements, will facilitate our objective of bringing more families into local communities thereby enhancing their vibrancy. This is consistent with our objective of enhancing the competitive advantage which our residential workforce provides whilst at the same time facilitating choice for others.”¹⁹

[29] Thereafter the letter goes on to discuss the “Continuous Improvement provision” in clause 16 of the 2007 Agreement. Also attached to the letter was a draft of various clauses including clause 11 which dealt with “Hours of work and rosters”. The draft clause 11 included a subsection 3 that provided that rosters could be introduced by the Company:

• With the agreement of a majority of employees rostered to work those rosters;

• Trialled in accordance with the continuous improvement provision; or

• In accordance with clauses dealing with temporary rosters for urgent operational needs or rosters which applied to contractors where work was insourced.

[30] It is necessary to note that the 2007 Agreement which was in effect when the 2012 Agreement was negotiated contained a Continuous Improvement clause which was numbered as clause 16. That clause – in identical terms – became clause 14 in the 2012 Agreement and the 2018 Agreement. However it is also apparent that throughout the negotiations for both the 2012 and 2018 Agreements both parties had different views about what could be implemented under clause 14 and how, and sought various amendments to the clause. Those views and the negotiations about the clause are instructive in the present case for the purposes of considering the context in which clause 11.5 of the 2012 Agreement was negotiated.

[31] The draft clause 14 proposed by BMA in the letter dated 9 December 2011 differed from the final version in that it did not provide that the proposal would be implemented if a majority of employees agreed but simply that the Company could implement the proposal following consultation and that if the Company elected to do so, a trial of the change would be conducted for a six month period. The proposed clause also provided for full implementation at the option of the Company at the end of the trial. The proposed clause further provided for examples of some of the changes that may be introduced under the clause and included the introduction of new rosters and indicated (by way of tracked changes) that the Company agreed to delete a reference to introduce standard rosters at standard rates of pay – ie. rosters that would be set out in the Agreement which the Company would have an automatic right to implement.

[32] Mr Vickers’ evidence is that the letter dated 9 December 2011 identifies that the genesis of clause 11.5 was to facilitate choice for employees. Mr Vickers also stated that clause 14 already gave the Company a way to make roster changes generally and the whole basis of clause 11.5 was to provide a mechanism for a commute arrangement for those who wanted it without the need to wait for the employer to instigate it – a bottom up rather than a top down change as provided by clause 14. According to Mr Vickers it was discussed and agreed that most roster changes would go through clause 14 and that clause 11.5 would only be used where the change came from employee demand.

[33] Mr Vickers states that clause 11.5 was the subject of discussion – with other clauses – for approximately six months. On 6 July 2012 the parties attended a mediation conducted by Mr Bill Kelty, former secretary of the Australian Council of Trade Unions. As part of the mediation the parties produced a Memorandum of Understanding (MOU) which set out principles. Two of these principles related to clause 11.5 with respect to the importance of the regional towns and the efforts of the parties to recognise both commute and residential living arrangements. The MOU was appended to an email sent to Mr Vickers (and others) by Mr Stelmach on 6 July 2012 and was tendered by Mr Vickers. In respect of the maintenance and improvement of regional townships the MOU states:

“Principles of Agreement

The parties to this agreement believe that it is intended:

…

4. The regional towns are not diminished by the terms of this agreement and the recognition of increased roster flexibility.

5. To recognise that both commuters and residential employees may desire a more flexible roster arrangement.

…4. Maintenance and improvements of the Regional Townships

The Unions and the Company are both strong believers in maintaining and developing the regional towns in which employees live.

One of the issues between the parties is the extent to which the rosters the employees work impact on their towns and the living standards of the community, including the family of the employees.

It is accepted by both parties that the rosters should as far as practicable meet these concerns and that the company does not intend to intentionally introduce rosters inconsistent with this objective.

5. Flexibility of Rosters

The Company has identified that there is a genuine demand for roster flexibility which gives greater breaks away from work.

This arises primarily from employees who elect to commute but also reflects the needs and aspiration of some employees residing in regional towns.

The Company genuinely wishes to meet this demand and an agreed process has been established to deal with this issue.

Both parties have agreed with a process which is consistent with these principles.

It is accepted that this may mean that some employees will be required to work on rosters that are inconsistent with their original terms of contract and existing rosters.”²⁰

[34] Also attached to the email sent with the MOU is a draft of clause 11.5. The proposed clause is in identical terms to the clause which appeared in the 2012 Agreement and later the 2018 Agreement The proposed clause 11.5 contains tracked changes striking out the following words, indicating that they had at some point been contained as an introductory sentence in an earlier draft of the clause:

“The introduction of a new roster or change to roster arrangements which are not agreed after genuine negotiations may be trialled and implemented in accordance with the Continuous Improvement provision (clause 14) provided that the Company will not introduce an unreasonable number of new arrangements for trial.”²¹

[35] Among the documents making up Appendix AV2 to Mr Vickers’ witness statement is a document headed “Outcomes of Mediation – As At 6 July 2012”. In relation to rosters, that document states:

“Implementation of new rosters

As per process agreed at July 6 meeting (appended).

Add wording to clarify that BMA can trial and implement new rosters / changes to roster arrangements.

[36] In relation to clause 11.5 Mr Vickers states that the use of the term “desire” in the clause is consistent with the repeated reference in the clause to the changes originating with employees. The parties did not define the term “significant” but Mr Vickers’ understanding is that this meant the clause was broad enough to accommodate changes that could work for each area because of the varying size and nature of crews required in particular areas. In order to facilitate a roster change, a “significant number of employees” would be higher in some areas than others, in light of the way that crews are structured. In relation to the term “relevant work area” Mr Vickers said that there was a common understanding that there would be commonality between workers and because the term was used elsewhere in the Agreement, such as in clause 11.2(a) which provides that draglines and field maintenance are two examples of work areas. Mr Vickers also states that it was never contemplated that a work area referred to a combination of areas and that the clause would have been worded differently if this had been intended.

[37] Mr Vickers tendered a Bulletin issued by BMA to employees on 28 September 2012 advising them that agreement had been reached and how they could access relevant material. Part of this material was an explanation of the Agreement which includes the following statement in relation to clause 11.5:

“…BMA may introduce a new roster with majority agreement of affected Employees or through the following process:

Gauging support for the changed roster arrangement amongst affected employees in the relevant work area;

Trial and implementation through Continuous Improvement; and

Allowing employees to express interest in transferring to another work area with the Employee’s current roster.

BMA will seek to accommodate suitable alternative rosters for Employees. BMA will give preference to Employees with the majority of relevant skills to transfer to another work area over other candidates.” 22

[38] Mr Vickers states that the process set out in the explanatory document broadly reflects his understanding of how the clause is to operate although it is missing some detail. First, employees would need to approach the Company to indicate that they wanted a different roster system. The second step is for the Company to gauge the views about the roster change of the employees affected by the change, both within the relevant work area and other work areas who worked similar rosters with similar skills and competencies. If a significant number wants the change, the Company would use clause 11.5 to accommodate that. According to Mr Vickers, this step was designed in part so that the Company could look at how requests for a roster change could be accommodated and make certain that they could still operate the work area under a new roster or under multiple rosters. This information would then inform the Company’s assessment of the business reasons for the change and how they could make it work and would form their justification for doing so. The roster would then be trialled and implemented.

[39] According to Mr Vickers’ evidence, the final steps would take place only if an employee ended up on a roster that he or she did not want to be on and the employee would then go through an EOI process set out in clause 11.5(d) to (g). This process was intended to support any employee who may have been caught up in roster changes to find their way back on to their preferred roster. In a second witness statement made on 11 December 2018,²³ Mr Vickers gave further evidence about negotiations for the 2012 Agreement based on documents he had recovered from his files after making his first statement. Mr Vickers tendered correspondence from BMA dated 21 July 2011²⁴ and Draft 9 of the 2012 Agreement referred to in that correspondence.²⁵ The correspondence proposed that BMA could introduce a standard roster following consultation with employees and a trial.

[40] Draft 9 of the 2012 Agreement contained a proposal by BMA for a clause 13.5 allowing changes to be made to rosters following consultation and a trial and for employees to be required to change shifts or rosters with notice including a minimum period of notice of seven days.²⁶ Version 9 also contained a continuous improvement provision at clause 16. That provision was similar but not identical to the provision that become clause 14 of the 2012 Agreement with one difference being that the proposal in Version 9 listed examples of some of the changes which might be introduced under the clause. The listed matters did not include changes to rosters.

[41] Mr Vickers states that between 21 July and the beginning of October 2011, the proposed 2012 Agreement went through a further three drafts. Version 12 of the proposed 2012 Agreement was tendered by Mr Vickers. That version is marked as the ballot version.²⁷ The roster clause in Version 12 of the proposed 2012 Agreement at clause 11, provided for standard rosters which were appended to the Agreement and “agreed by employees” to be introduced by BMA following explanation and engagement with employees, and subject to 28 days’ notice. Version 12 of the proposed 2012 Agreement also stated that subject to clause 11.5(f) – which dealt with temporary rosters – any other roster could be introduced or changed at the Company’s initiative, with the agreement of the majority of affected employees. The proposed roster clause in Version 12 also provided that the introduction of such rosters would not be subject to clause 14 which dealt with continuous improvement and consultation. The continuous improvement process in clause 14 of Version 12 was identical terms to the provision in Version 9. Version 12 went to a ballot of employees in or around October 2011 and was rejected by a majority.

[42] Version 13 was circulated by BMA on or around 22 November 2011 and included a provision at 11.1 which allowed BMA to implement flexible work rosters to meet the needs of Mines. 28 A rostering provision at clause 11.5(a) provided that starting and finishing hours of any shift would be agreed between BMA and the majority of affected employees and clause 11.5(b) of Version 13 of the proposed 2012 Agreement provided for BMA to change the roster or shift of an employee with notice of at least seven days.²⁹ Version 13 also included a continuous improvement process at clause 14 and the list of changes that could be introduced using that process included:

“(d) The introduction of standard rosters at the standard rates of pay as set out in Schedule 8 and repeated in each Mine Schedule; and

(e) The introduction of new rosters.”

[43] Mr Vickers also tendered an explanatory document distributed by BMA showing changes from Ballot Version 12 to Version 13 of the proposed 2012 Agreement. That document included changes to clauses 11.5(a) and 11.5(b) as a result of the Continuous Improvement provision being used for introducing new rosters.³⁰ The document also states that changes to clause 14 Continuous Improvement have been made to clarify the Company’s ability to introduce standard and new rosters. On 22 November 2011 the SBU received correspondence from BMA responding to a number of claims including a claim by the SBU that rosters could only be changed by agreement of a majority of employees. In that letter which was tendered by Mr Vickers, the Company states that while acknowledging that the SBU has attempted to formulate an alternate set of standardised roster guidelines, its proposal restricts the Company in the introduction of other rosters, “cherry picks” aspects of the continuous improvement process and results in a proposal that is far more restrictive than the current continuous improvement process.

[44] The letter goes on to state that BMA has made a significant alteration to its standard roster proposal in version 13 of the proposed 2012 Agreement by listing standard rosters and salaries in Schedule B to the Agreement and in each of the Mine schedules. The letter further states that standard rosters may be introduced under the existing continuous improvement mechanisms which have been in place for many years and are familiar to employees.³¹ Mr Vickers also tendered a Bulletin issued by BMA to its employees on 22 November 2011 highlighting its commitment to residential and commute options for employees. The Bulletin states that the Company is growing its residential workforce but needs to do more for employees who already commute. The Bulletin also states that many employees (approximately 30 – 40%) commute from other towns to work and that the Agreement should enable the Company to explore the introduction of rosters which support employees who choose to commute. On 10 January 2012, Mr Vickers drafted what he referred to as “the first iteration of clause 11.5”. The clause drafted by Mr Vickers was titled “Implementations of Alternative Rosters”. Mr Vickers said that it was specifically designed to address the problem of facilitating rosters for commute workers and an alternative to the rosters that was preferred and worked by the majority of workers. The clause drafted by Mr Vickers contained (in summary) the following provisions:

• Acknowledgement by the Company that employees would likely continue to be predominantly residentially based in the towns of Blackwater, Emerald, Dysart and Moranbah;

• Acknowledgement that an increasing numbers of employees have opted to commute rather than reside in those towns;

• During the life of the Agreement the Company may seek to implement rosters that take account of differing lifestyle choices made by employees while continuing to seek to ensure efficient and effective operations;

• At the commencement of the 2012 agreement employees in the respective work areas as described in the Agreement will continue to work the rosters as provided in the Agreement and its schedules;

• A Register of employee preference for either a commute or residential roster to be established within six months of the 2012 Agreement commencing; and

• Opportunity for employees to alter their nominated roster preference each 12 months.

[45] Mr Vickers’ draft clause also contained the following provision:

“Where the number of employees in a particular work area or part thereof who have registered a preference for a commute type roster is such that the Company, at its absolute discretion, is of the view that a roster more conducive to commute arrangements can or should be introduced for those Employees then the Company may reach Agreement with the majority of those Employees on the alternative roster to be introduced and worked by those Employees.

Nothing in this sub-clause limits the Company from reaching agreement with the majority of Employees in a particular work area or part thereof working commute and residential rosters respectively, to change from one form or residential or commute type roster.

The Continuous Improvement Clause (X of this Agreement) will not apply to the trialling of rosters.”³²

[46] Mr Vickers said that by around January 2012 the SBU and the Company had reached some consensus on the use of the continuous improvement clause to implement new rosters and tendered updates from the SBU to members informing them that the Unions had managed to “claw back” some of the conditions that the Company had sought to remove from the proposed 2012 Agreement including “Continuous Improvement for the implementation of new rosters”.³³

[47] On 18 March 2012 Mr Stelmach on behalf of BMA provided the SBU with Version 15³⁴ of the Agreement and a list of changes between Version 14 and Version 15³⁵. In respect of clause 11.5, Version 15 changed the title of the clause from “Changes to Roster Arrangements” to “Introduction of New Rosters and Changes to Roster Arrangements.” The proposed clause provided that the introduction of new rosters or changes rosters which are not agreed after genuine negotiations may be trialled and implemented in accordance with the Continuous Improvement provision (clause 14). The description of the change to clause 11.5 between Version 14 and Version 15 of the 2012 Agreement was described in the document prepared by BMA as:

“Title amended and additional wording included to clarify BMA’s ability to implement new rosters and changes to roster arrangements following a trial conducted under the continuous improvement provision.”36

[48] Another version of the proposed 2012 Agreement was put to a ballot of employees in May 2012. That version included clause 11.5 as it had previously appeared in Version 15. The proposed Agreement was again rejected by employees. On 8 June 2012, Mr Stelmach emailed proposed wording for an alternative roster provision to the SBU.³⁷ That wording stated that the Company could implement alternative rosters to facilitate attraction and retention of employees, commuting arrangements and/or improved workplace productivity. The wording proposed by Mr Stelmach also included a commitment that the Company would seek to maximise – as far as reasonably practicable – the extent to which employees could work under their preferred roster arrangements.

[49] Further the Company’s proposal made on 8 June 2012 was for provisions which allowed it to introduce an alternative roster with the agreement of a majority of employees or by trialling the roster in accordance with clause 14 (continuous improvement). The proposal also gave the Company the right to establish and select the relevant work area based on any suitable grouping of employees without limitation and to transfer employees to other work areas prior to seeking to implement a new roster in order to facilitate a majority in the area where the roster was to be implemented. An amendment to clause 14 was also proposed by the Company to the effect that the clause would only apply to the introduction of new rosters or making changes to existing rosters to the extent provided for in clause 11.5(d). In the draft proposed by the Company clause 11.5(d) provided for implementation of roster trials under the continuous improvement process in clause 14.

[50] On 19 June 2012 Mr Vickers provided Mr Stelmach with proposed wording for an alternative roster provision which was tendered by Mr Stelmach in his witness statement in this case.³⁸ That draft of the provision as proposed by Mr Vickers commenced with an acknowledgement that there are a number of employees who have genuinely and voluntarily adopted a commute lifestyle and that such employees may be interested in working a different roster than that worked by employees who have adopted a residential lifestyle. The clause proposed by Mr Vickers provides that where the Company seeks to introduce a different roster to better accommodate employees’ preferred lifestyle arrangements, it will gauge support for rosters from employees in the relevant work area and other work areas working similar rosters and will also gauge the desire of employees to retain roster arrangements that currently applied. Information gained from employees will be incorporated into “business reasons” for the proposed roster change. The proposed clause also provided for an expression of interest to be made by employees to move to other work areas as a result of roster changes. Mr Vickers also proposed the addition of a provision that recorded the acceptance of the parties that the “Changes to Roster Arrangements” clause was intended to provide genuine choice for employees preferring to adopt a commute lifestyle arrangement.

[51] Mr Stelmach’s response to the proposal was made by letter dated 21 June 2012.³⁹ Among the issues raised in the response were that the proposed clause is too narrow as it refers to roster changes simply addressing commute arrangements and does not cover other reasons for the introduction of new rosters as the current continuous improvement clause does. The response also raises concerns that while employees’ views about rosters are important they cannot be a reason to over-ride business reasons for a new or changed roster. Further concerns were that the proposed clause did not contemplate residential employees also choosing to work new rosters and categorised all rosters as either residential or commute, which the Company did not agree with. In addition, the Company expressed concern about the lack of definition of the term “a significant number of employees” in the Union’s proposal.

[52] On 3 July 2012 the Company provided an edited version of the clause for the purposes of mediation. That version included a first paragraph in the following terms:

“The Company may introduce new rosters to meet the needs of the business and in so doing will follow the process in this clause that facilitates changes in roster arrangements which affect existing employees.” 40

[53] According to Mr Vickers, given the significant exchanges about the roster clause and Mr Stelmach’s very specific engagement with its text, there was no feeling that the terms of the clause were ambiguous or that the inclusion of the Company’s proposed wording at the beginning of the clause changed its purpose or meaning. BMA was still bound by the purpose of the clause because that was part of its process. Other roster changes could still be made through the continuous improvement provision and according to Mr Vickers, this is made clear in the final version of the clause. Mr Vickers also disputed Mr Stelmach’s assertion that the inclusion of the first paragraph in the clause was a major change and maintained that it simply clarified that BMA could trial and implement new rosters through the use of the clause. Mr Vickers also disagreed with Mr Stelmach’s assertion that an employee would never put forward a roster change and said that Mr McKenzie’s statement indicated that this could happen on site.

[54] With respect to Mr Stelmach’s assertion that a “significant number” meant a majority of the minority, Mr Vickers said that this was difficult to comprehend and would mean that at best, support from 24% of the relevant work area could be used to justify a change to the whole work area and that to go from requiring majority support to 24% or even less, is implausible. Mr Vickers agreed with Mr Stelmach that the term “work area” was never discussed, and said that this was because of the common understanding of the term and its clear meaning in the 2007 Agreement which refers to work areas at clause 6.4, 13.7, 17.1.2, 17.4.1, 18.4.3 and throughout the schedules. In this regard, the 2007 Agreement (which applied at the time the 2012 Agreement was being negotiated) identified functional work areas for the GRS in Local Schedule A as: Mine Operations (draglines, drill & blast, coal mining, pre-strip); Field Maintenance; Mobile Maintenance; SHECON and Coal Processing. Clause 5 of Version 13 of the 2012 Agreement refers to functional work areas but there is no identification or definition of specific areas in Version 13.

[55] In a witness statement made on 11 December 2018, Mr West gave evidence about the negotiations for the 2018 Agreement.⁴¹ Mr West tendered a letter from Mr McKenzie on behalf of BMA dated 7 April 2016, which attached a comparison table in respect of draft VI of the 2018 Agreement, showing the stage the parties had reached in the negotiations with respect to each clause.⁴² The document demonstrates that BMA was seeking amendments to clause 11.5 to allow the introduction of new rosters and roster arrangements, with four weeks’ notice and following consultation with affected employees under clause 14.4.

[56] A further document tendered by Mr West set out the response of the CFMMEU to claims made by BMA on 13 April 2016 indicating that the CFMMEU did not agree to the Company’s proposal in relation to rosters and roster changes and sought that employees be provided with certainty in roster arrangements and changes being achieved through a requirement to reach agreement following notification and consultation.⁴³ A further document entitled “Record of Meeting” in relation to an EA negotiation meeting held on 13 April 2016 indicates that the CFMMEU was seeking the removal of the clause entitled continuous improvement and the removal of a reference to continuous improvement – ie. clause 14.

[57] The CFMMEU submits that the correct process required to be followed by BMA to introduce a new or change roster is as follows:

Step One

• affected employees are notified of the proposal in writing;

• if requested an employee representative of the affected employees is also to be notified of the proposal;

• this notification includes the business needs for the proposal and the duration for gaining the evidence for evaluating the success of the trial; and

• prior to a vote on the changes, a genuine attempt is to be made by all parties to reach an agreement.

Step Two is to take a vote on the proposal as required in clause 14. In the event of a failed vote BMA may elect not to proceed with a trial or commence the process set out in clause 11.5.

Step Three is to determine the views of the majority of the affected employees. This involves a separate process to the one required at clause 14(a) and will take into account the views of affected employees of both their existing and proposed rosters.

Step Four gives BHP the opportunity to re-evaluate their initial business reasons for the change.

Step Five reverts back to clause 14 for the trial and implementation of the roster.

Step Six allows employees to lodge an EOI to return to their original roster, to be processed, in most circumstances, following the trial.

[58] In relation to the roster change implemented in the Dragline Department subject of the present dispute, the changes were implemented “to reduce handovers and allow for continuous allocation of tasks”. This is a fundamental misapplication of clause 11.5 and according to the CFMMEU there are additional issues with the process followed by BMA as set out in the evidence of Mr West. Firstly BMA did not meet the requirements in clause 14(a) by notifying Mr West of the proposal in writing; providing Mr West with the required business reasons; and making a genuine attempt to reach an agreement. Further the CFMMEU submits clause 11.5 required that the two process of a vote and genuine attempt to determine the view of a majority of affected employees. The CFMMEU submits that it is unclear which of these BMA has done but it has not done both. Finally, by the time it was appropriate to consider EOIs following the trial period BMA had little, if any, capacity to accommodate any such requests and it is unclear if requests have been made.

[59] In relation to Production roster changes, the CFMMEU submits that the changes were introduced to improve work continuity across departments and alignment for those who commute, and to reduce handovers and allow for a continuous allocation of tasks. In addition to the fundamental misapplication of clause 11.5, there are further issues with the procedure followed by BMA. Firstly BMA did not meet the requirements in clause 14(a) in that it failed to provide sufficient detail as to required business reasons for supporting the proposals and did not make a genuine attempt to reach an agreement. The CFMMEU also asserts that it is not clear that BMA made a genuine attempt to determine the view of a majority of affected employees and that as Mr West states, members of the Union were not aware of the proposal until around May 2018 when it proceeded to a vote and then implementation. The CFMMEU contends that this is suggestive of BMA conflating the voting and gauging processes.

[60] BMA has also grouped three work areas together for the purposes of the vote and defined this as a “relevant work area”. The CFMMEU submits this grouping is unsuitable and cannot possibly facilitate a meaningful process under clause 11.5(b) or achieve the proper purpose of clause 11.5. Finally, by the time that BMA is required to carry out step six in the process, all but the drill and blast departments will be on the new roster and the effect is that employees have had their entitlement to an EOI process removed. The CFMMEU contends that the grouping by BMA of Mine Services, Processing and Coal Mining for the purpose of determining a significant number of employees is an incorrect application of the provision and has created an irrelevant and unsuitable grouping of employees.

[61] In relation to what constitutes “a significant number of employees”, the CFMMEU submits that this is a number that is noteworthy, important or consequential and is determined by reference to affected employees and not just those who participated in the vote. The parties did not fix a meaning for the term “significant number” for several reasons. Firstly, the clause is an accommodation of employees’ desires and an inconvenience for BMA. The Company would not endure that inconvenience unless the benefit to employees was sizeable enough to justify it. Secondly the term is intentionally broad so that it can accommodate the flexibility required to achieve its purpose. For example, 8 people in a work area of 32 could be significant where the area could operate crews autonomously and could accommodate crews moving around based on their roster preferences.

[62] The CFMMEU submits that in the present case, the numbers cannot be significant because BMA has misinterpreted the clause. A number will be significant depending on the size and nature of the work area and without this context it is difficult to determine. The numbers may amount to significant numbers subject to a proper application of the clause. If the interpretation of the clause contended for by BMA is accepted and the Company has the discretion to dictate the conditions of employment for employees subject to the support of a significant number, then the Commission should favour an interpretation of the Agreement that places the threshold of “significant” as a high number just short of a majority. That number needs to be high enough to justify forcing a majority of employees on to a new roster. Accordingly, it cannot be accepted that a percentage as low as 21.7% is sufficient to give effect to such a change. While 41.5% is more palatable, it still falls short of being “significant” given the consequences of determining it to be a significant number.

[63] The CFMMEU submits that its interpretation of clause 11.5 of the 2012 and 2018 Agreements should be accepted and the Commission should determine the dispute by finding that the trials of the roster changes and the subsequent implementation of the Dragline roster changes were conducted in a way that is not consistent with the clause. In the alternative, the CFMMEU asserts that it cannot be accepted that the numbers BMA has relied upon to justify the roster changes amount to a “significant number” within the meaning in clause 11.5 of the Agreements. Further, the decision of BMA to group the work areas of Mine Services, Processing and Coal Mining represents an unsuitable employee grouping and is inconsistent with clause 11.5.

[64] The CFMMEU seeks that the Commission resolve the dispute by providing a determination that BMA has not complied with its obligations under clauses 11.5 and 14 and that the roster changes be suspended and employees revert back to their original rosters. Should BMA wish to implement these or other roster changes in the future the Commission should provide further determination that this be done in accordance with the procedure set out in clause 11.5 of the Agreement.

[65] In oral submissions Mr Bukarica for the CFMMEU said that the Commission should have particular regard to both the predecessor agreements and the relevant clauses appearing in them and the MOU arising out of the mediation for the 2012 Agreement. As there is no substantive difference between the relevant versions of the clause in the 2012 and 2018 Agreements, the relevant period of time to which the Commission should apply interpretative principles such as those relating to post-agreement conduct, is at the making of the 2012 Agreement because that is when the meeting of the minds occurred in terms of the text which is now clause 11.5 of the 2018 Agreement.

[66] While the Commission should have regard to the prefatory words of clause 11.5 of the Agreements that regard should be coloured or influenced by what the remainder of the clause seeks to do. It is not a case where the needs of the business give the employer carte blanche but rather the clause is carefully constructed to allow a process to occur which is all about facilitating employee choice in a manner that does not undermine residential focussed rosters. That intent is evident in the second and third paragraphs of clause 11.5 and it is unusual to see such a form of words in the middle of a clause rather than in an initial part of the Agreement dealing with objects or the like. The work to be done by those words is to focus the mind on the purpose of the clause. This is emphasised by the paragraph that follows indicating that the clause will not be used to facilitate a roster change unless it is identified that a significant number of employees desire such change. The following paragraph and then sub-sections (a) and (b) make it clear that clause 14 is the first port of call and the appropriate way for the Company to seek to introduce a roster change.

[67] Mr Bukarica also submitted that whether the change is bottom up or top down, the clause provides that where there is a demand or a significant number of employees that the company has determined, through a proper process, are interested in an alternative roster then there is a process to follow. In a practical sense employees may approach a supervisor seeking a roster change and the supervisor would report this to more senior management. The fact that the Company may be the formal moving party is not determinative about what the focus of the clause is – accommodating employee preferences. In response to a question from the Commission, Mr Bukarica said that a change to rosters under clause 11.5 is required to be connected to some desire on the part of employees to work a particular roster.

[68] In an exchange with me during oral submissions, Mr Bukarica accepted that clause 14 of the 2012 and 2018 Agreements allow the Company to press a roster change for commuters in circumstances where a majority does not agree, by using the trial and implementation process in clause 14. In those circumstances employees can dispute the trial and implementation at two stages – the commencement of the trial and during the last four weeks of the trial – on the basis that the proposal is harsh, unreasonable and unjust. Mr Bukarica also accepted that if the roster proposed by the Company related to the preferred lifestyle arrangements of employees, BMA could use clause 11.5 to trial the proposed roster if it did not achieve majority support in accordance with clause 14 of the Agreements. Mr Bukarica maintained that the Company could not revert from clause 14 to clause 11.5 in circumstances where a proposed roster related only to its business needs. 44 In another exchange Mr Bukarica agreed that the Company could use clause 14 of the Agreements to introduce whatever roster it wanted provided that it satisfied the majoritarian principle in that clause.45

BMA

[69] BMA describes the dispute in its submission as a dispute in relation to the correct process for introducing changes to roster arrangements at the Mine. After setting out the principles of construction in relation to enterprise agreements BMA submits that one factor is that the Commission will not make too much of infelicitous expression in the drafting. BMA further submits that construction of industrial instruments should contribute to a sensible industrial outcome and the Commission should consider what each party by words and conduct would have led a reasonable person in the position of the other party to believe. The Commission should not consider the subjective beliefs or understanding of any party and should not rewrite an enterprise agreement to achieve an outcome that the Commission thinks is fair and just regardless of the terms of the Agreement. BMA further submits that evidence of surrounding circumstances should be admissible in the manner discussed by the Full Bench of the Commission in Berri.

[70] In relation to the process the Company should follow under clause 11.5 of the 2012 Agreement to introduce the trial of a roster, BMA submits that under paragraph one of that clause, it is entitled to introduce new rosters to meet changing business needs. It is submitted that this is more than an acknowledgement. It is an agreement. This is supported by the context in which the 2012 Agreement was made, what it was intended to address and the facts as they were known at the time it was drafted. It is also consistent with how the parties have applied the clause since the first time it was used. This conduct shows that there was an actual meeting of minds, a consensus which is more than the absence of a complaint or common inadvertence.

[71] According to BMA, paragraph 5 of clause 11.5 operates on the basis that if the business wishes to introduce the change it will seek a majority as defined in clause 14. If that majority is not obtained, but a significant number of employees desire a change as per paragraph four, then it can use the steps in paragraphs (a) to (g) to trial the roster and if decided, to implement the roster.

[72] Paragraph (b) requires the Company to first gauge the support – ie. use genuine attempts to determine the view of the majority of affected employees in the relevant work areas and other work areas. Any feedback is incorporated into the business reasons referred to in paragraph 1. If the Company still seeks to introduce the new or changed roster, and it will facilitate preferred lifestyle arrangements, then the Company can use the trial provisions of clause 14(d) and (e). Paragraph 4 of clause 11.5 places the only limit (other than the process steps in paragraph 5) on BMA’s ability for business reasons to introduce the changes to roster arrangements, by requiring that a significant number of employees desire such changes. During the trial employees can use the EOI provisions of clause 11.5(e) and at the end of the trial employees can utilise the EOI provisions of clause 11.5(f) to 11.5(g).

[91] In oral submissions on behalf of BMA, Mr Coonan said that the evidence of Mr Vickers indicated that in his mind when the 2012 Agreement was negotiated, a not insignificant number of employees wanted a commute arrangement. In this regard, Mr Coonan referred to the letter from Mr Stelmach tendered by Mr Vickers indicating that the Company’s view was that 30 – 40 % of employees were commuting. 53 Mr Coonan stated that this indicates objectively what the view of the parties was in relation to a significant number. Mr Coonan further submitted that while the parties may have had discussions about the meaning of the term “work area” no specific definition was included in the Agreement because this was unnecessary given the broad definition of work area agreed to. Mr Coonan also referred to a range of material tendered in the hearing indicating that the Company had a dual purpose in introducing roster changes which included changes related to productivity or for business reasons.

[92] In response to a proposition from me that clause 14 of the Agreements appears to allow BMA to introduce whatever roster it wishes subject to the Commission’s power to determine that a roster is having a harsh, unjust or unreasonable effect on employees at various stages of the trial process, Mr Coonan contended that the evidence of Mr Vickers was that clause 14 did not allow the Company to implement a roster after a trial unless a majority of employees agreed. Mr Coonan also pointed to the evidence of Mr Stelmach and Mr Brady that Mr Vickers had made this assertion in bargaining in for the 2012 Agreement. In response to the proposition from Mr Bukarica that the assertion made by Mr Vickers related to the 2007 Agreement, Mr Coonan submitted that the 2007, 2012 and 2018 Agreements contained the same continuous improvement provision. Mr Coonan submitted that it was this view on the part of Mr Vickers that caused BMA to seek to have a roster change clause outside of the Continuous Improvement clause. Mr Coonan also said that in hindsight clause 14 may have given BMA the right to introduce rosters regardless of the views of employees but in January 2012 Mr Vickers had indicated that he would pursue the Company in the Federal Court if it sought to implement rosters under clause 14 in the absence of majority agreement.

[93] Mr Coonan submitted that Mr Vickers’ evidence establishes that there were two distinct intentions for the clause that became clause 11.5 – one to enable the Company to introduce rosters generally and one for the introduction of rosters to support a commute lifestyle. Mr Coonan also pointed to the uncontested evidence of Mr McKenzie in relation to the discussion he held with Mr Vickers about the effect of clause 11.5 after the 2012 Agreement was approved and the fact that the Union in bargaining for the 2018 Agreement wanted clause 11.5 varied to remove the right of the Company to implement rosters, other than by majority agreement.

[94] Mr Coonan submitted that the context of the bargaining and the mediation indicates that the Company wanted and obtained by agreement, the right to introduce new rosters provided that it followed the steps set out in the 2012 Agreement. The words of the 2012 Agreement and later the 2018 Agreement are clear and enable BMA to initiate any roster changes based on its business needs. It is also clear from the evidence of these contextual matters that BMA can select the work areas and that significant numbers for the purposes of the clause are between 30 – 40 %. Clause 11.5 permits roster changes for both commute and non-commute reasons. The interpretation contended for by the CFMMEU would give no meaning or purpose to the first paragraph of clause 11.5 or would need the Commission to imply words that the Company needed both a business reason and a commute reason.

[95] If there is ambiguity in clause 11.5 then the objective background facts in relation to the clause from mid-June to mid-July 2012 supports the construction proposed by BMA. This is also confirmed by the evidence about what employees were told about the clause appended to Mr Stelmach’s statement in the form of a Power Point presentation. While maintaining that context clearly favours the interpretation advanced by BMA, in the alternative, Mr Coonan referred to the judgement of Tracey J in United Voice v Wilson Security Pty Ltd⁵⁴ where his Honour held that in the absence of any clearly understood and mutually accepted understanding of the operation of an award provision, it is all the harder to support the implication of terms which do not appear in the award.

CONSIDERATION

The questions for arbitration

[96] The case conducted by the CFMMEU and the outcomes sought are at odds with the agreed questions for arbitration. The questions for arbitration which were agreed between the parties do not require me to determine whether BMA has complied with the terms of the 2018 Agreement (and the 2012 Agreement) with respect to the steps that the Company has taken in relation to changing rosters at GRS. Rather the questions for arbitration require that I determine what process should be followed under the 2018 Agreement to introduce a trial of a roster and whether the numbers of formal votes in various areas is a “significant number of employees” for the purposes of clause 11.5 of the 2012 and 2018 Agreements.

[97] Accordingly, a finding as sought in the CFMMEU’s submission that the roster changes brought about by BMA were not implemented in a way that is consistent with clause 11.5 is not a matter that can be dealt with in terms of the present dispute and the questions for arbitration. These are matters which may arise at a future point. The questions for arbitration also do not call for consideration of whether the rosters being trialled or implemented are rosters which do facilitate employees’ lifestyle choices or whether the trial or implementation of particular rosters is harsh, unreasonable or unjust for employees. It is also the case that the questions for arbitration do not require me to determine how BMA might proceed to implement a new or changed roster following a trial. I turn now to consider the questions for arbitration.

Relevant work area

[98] The starting point for the construction of an enterprise agreement is the ordinary meaning of the relevant words. The provision of both the 2012 and 2018 Agreements dealing with the issue of “relevant work area” is found in clause 11.5(b). There is a definition of the term “relevant work area” in clause 11.5(b)(2) of the 2012 and 2018 Agreements. On the plain words of that clause, a relevant work area means the work area in which the roster will be implemented as determined by the Company. The clause goes on to provide that the relevant work area may be any suitable grouping and gives examples of functional work area, a subset of a functional work area, a single crew or other grouping. The clause gives the Company the right to determine what the work area is in which a new roster may be sought to be introduced. The only limitation is that the relevant work area determined by the Company for the purposes of the clause cannot be a single employee or the entire mine.

[99] I do not accept that in the context of the definition of “relevant work area” and the right that BMA has under clause 11.5(b)(2) to determine where a roster will be implemented, that the terms “relevant” or “suitable” act as a limit on the discretion of the Company to determine what a relevant work area will be for the purposes of clause 11.5. In my view the clause makes clear that what is suitable is a matter for BMA to determine based on the proposed roster that is being dealt with in accordance with clause 11.5

[100] This construction is supported by the text of the Agreement considered as a whole. In this regard it is significant that the 2012 Agreement refers to “functional work areas” in clause 5 which deals with training and clause 8.3 which deals with the selection process for career development and progression. For the purposes of these clauses, there is a definition of the term “functional work areas” in clause 41 of the 2012 Agreement in the following terms:

“41 Functional Work Areas

41.1 Functional Work Areas are identifiable segments of the Mines which have their own specific skills requirements. For example, in Truck/ Shovel, a mix of skills would include shovel, truck, grader, etc. The Company is responsible for determining the actual skills required and the necessary number of such skills in each functional work area.

41.2 Functional Work Areas are relevant to the circumstances outlined in clauses 5.1(b) and 32.5(b) of this Agreement and clause 5.2 (a) of Schedule 1.

41.3 As at the commencement of operation of this Agreement, the functional work areas in each mine are:

Open Cut	Crinum
Production Pre-strip	Development
Production Mining (inclusive of DRE, drill & blast, Truck/ shovel, Pumps & Earthworks, & others)	Production
Production Processing	Development maintenance
Maintenance (inclusive of Field, Mobile and Processing maintenance)	Production maintenance
Engineering

The Company may vary or add to these Functional Work Areas from time to time in the event the Company makes organisational structural changes.”

[101] If the parties had intended that the term “relevant work area” in clause 11.5 of the 2012 Agreement was synonymous with the term “functional work area” in clause 41 or was limited to groupings of functional work areas or groups performing the same or similar work, it would have been easy to stipulate this. The parties did not. It is clear from the wording in clause 11.5(b)(2) of the Agreements that relevant work area is intended to be broader than a single functional work area or a number of such areas as evidenced by the fact that a relevant work area may be an entire functional work area, a subset of such an area, a single crew or other grouping. I do not accept that the term “relevant work area” is limited to an identifiable segment of the Mine or to circumstances where there is a high degree of commonality between the workers. I also do not accept (as stated by Mr Vickers) that it was never contemplated that a relevant work area could be a combination of areas. While Mr Vickers may have had that intent, it is not reflected in the wording of clause 11.5(b)(2) of the 2012 Agreement and subsequently the 2018 Agreement. In fact, the wording of clause 11.5(b)(2) is entirely inconsistent with that intent.

[102] A broad construction of the term “relevant work area” is also supported by the general context of the negotiations for the 2012 Agreement. During the extensive period in which the 2012 Agreement was negotiated, the 2007 Agreement was in effect. While the 2007 Agreement identifies specified functional work areas in the local Schedule for GRS Mine and in some but not all of the Mine specific schedules, it did not contain a specific definition in the body of the Agreement. By at least version 9 of the 2012 Agreement there was a definition of the term “functional work areas” in the body of the Agreement. The definition of “functional work areas” had reached its final form by Version 13 of the 2012 Agreement and became clause 41.

[103] The inclusion of clause 41 of the 2012 Agreement and the fact that the 2007 Agreement did not contain an earlier version of the clause indicates that the parties were negotiating about this matter. Had they intended that “relevant work areas” for the purposes of clause 11.5 were to be structured along the lines of an identifiable segment of the Mine or to groups of workers with a high degree of commonality, it would have been easy to have restricted the definition in clause 11.5(b)(1) to functional work areas or a combination of such areas. Instead, the parties included a range of areas in the definition of “relevant work area” which include but are not limited to functional work areas. They also included a catch all term “other grouping”. These contextual matters point to a broad definition of “relevant work area” and in this context the term “suitable” to BMA for the purpose of the subject matter of the clause – the introduction of new rosters and changes to rosters with the agreement of a significant number of affected employees.

[104] Regardless of whether the purpose of clause 11.5 is directed to the desire of employees or the business needs of BMA, it is clear from the evidence of the negotiations that the parties turned their minds to the way in which rosters could be made to function if some rather than all employees in a relevant work area who wanted to work a particular roster, were in the minority. On the facts known to both parties at the time the 2012 Agreement was negotiated employees who wanted to work a commute roster were in the minority. It is clear that the parties intended to negotiate a clause that allowed for workers to be grouped together for the purposes of making a roster function appropriately and that there was flexibility given to BMA in respect of grouping employees for this purpose.

[105] It is also the case that the early version of what became clause 11.5 of the 2012 Agreement proposed by Mr Stelmach on 8 June 2012 allowed for any grouping of employees and for the Company to transfer employees to other work areas in order to obtain majority support in the area in which the roster was to be implemented. While this specific wording did not make its way into the 2012 Agreement, the wording in clause 11.5(b)(2) is sufficiently broad to enable BMA to structure a work area to enable rosters to be populated with employees who wanted to work them and could operate effectively. This is supported by clause 41 of the 2012 Agreement which allows BMA to vary or add to functional work areas in the event the Company makes organisational or structural changes. Accordingly, both the text and context of clause 11.5 support a broad interpretation of the term “relevant work area” in clause 11.5(b)(2) of the 2012 Agreement.

Process to introduce a trial of a roster

[106] It is convenient to commence with consideration of the competing contentions of the parties about whether clause 11.5 of the Agreement permits BMA to propose a roster change or a new roster based only on the needs of the business. The plain words of the first paragraph of clause 11.5 make it clear that BMA can use clause 11.5 to propose a new roster or a roster change to meet the needs of the business subject to following the process set out in the clause. When BMA proposes a new or changed roster as provided in the first paragraph of clause 11.5 it is not restricted to proposing a roster to address lifestyle arrangements for employees. It is a fundamental canon of construction of an enterprise agreement that its terms should have some work to do. If clause 11.5 did not permit BMA to introduce new rosters for business reasons, the first paragraph of clause 11.5 would have no work to do and would be rendered otiose.

[107] I do not accept that clause 11.5 applies only in respect of new or changed rosters proposed by employees. While clause 11.5 refers to the interests and desires of employees with respect to working certain rosters, it makes no specific reference to employees proposing new or changed rosters. All of the paragraphs of the clause which follow paragraph 1, indicate that the involvement of employees is in response to the proposal for a different roster for the purposes of: establishing whether there is a majority which supports the proposal; indicating whether a proposal for a changed roster is supported as part of the process for gauging support among affected employees; and providing information which will be incorporated into the business reasons for the roster change for the process under clause 14. These are all matters that would primarily be driven by BMA.

[108] While I do not rule out that employees could initiate a roster change under clause 11.5 of the 2012 Agreement, there is no clear statement to this effect. It would be expected that if the intention of the parties was to preclude any roster change initiated by BMA from being dealt with under the clause this would have been clearly stated and the first paragraph would not have been included in the clause. The reference in the first paragraph of clause 11.5 to the Company introducing new rosters to meet the needs of the business in the context of a clause which makes no specific reference to employees introducing new rosters, does not support the construction of the provision advanced by the CFMMEU to the effect that clause 11.5 is intended to provide for bottom up roster changes or new rosters proposed by employees, to the exclusion of roster changes or new rosters proposed by BMA.
[109] I do not accept the proposition advanced by the CFMMEU that the reference to business reasons in clause 11.5(c) means that business reasons are only relevant in circumstances where employees are driving roster changes or new rosters and to BMA’s response to requests for roster changes made by employees. The term “business reasons” is used in clause 14 of the Agreements where the Company initially seeks majority support for a change. It is also used in circumstances where majority support is not achieved and a trial is to take place in the context that the view of employees gauged from the trial can be used to inform the business case for a roster change. Accordingly, the reference to business reasons in clause 11.5(c) is a further indication that new or changed rosters can be sought by BMA for business reasons. There is also the matter of the cross-over between clause 11.5 and clause 14 Continuous improvement. Clause 14 clearly deals with changes proposed by BMA and provides the first step in the process of introducing a new roster or changing an existing roster in clause 11.5. It would be illogical to construe clause 11.5 as being restricted to changes to rosters or new rosters proposed or initiated by employees or to rosters that are only for the purpose of addressing lifestyle arrangements for employees.

[110] I turn now to consider the process to be followed by BMA to implement a new or changed roster under clause 11.5. The drafting of clause 11.5 of the 2012 Agreement, particularly in relation to the interaction between that clause and clause 14, leaves much to be desired. To make sense of both clauses and to give each provision some work to do, my conclusion in relation to process is as follows. For convenience I refer to the relevant clauses in the 2018 Agreement.

[111] For the reasons set out above, pursuant to the first paragraph of clause 11.5 of the 2018 Agreement BMA may introduce a new or changed roster to meet the needs of the business. BMA must first propose the new or changed roster under clause 14 of the 2018 Agreement by written advice to the affected employees (and if requested their representatives) in relation to the following matters:

• The proposal for the new or changed roster (which by definition will include the work area in which the proposed roster is to operate);

• Business reasons supporting the proposal as defined in clause 14(j);

• The necessary duration of any trial of the new or changed roster for gaining required evidence in the event that majority agreement for the new or changed roster is not achieved.

[112] If the majority of affected employees agree with the proposal for the new or changed roster BMA can proceed to implement the roster as provided in clause 14(b). If there is no agreement by the majority of affected employees BMA may then pursue the introduction of a different roster by reverting to clause 11.5 of the 2018 Agreement. It may be open for BMA to continue to press for the roster it initially proposed by electing to proceed with the proposal under clause 14. However, this aspect of the interaction between clauses 11.5 and 14 of the 2018 Agreement is not a matter that is within the scope of the questions for arbitration in the present dispute and I make no finding in this regard.

[113] In the event that BMA seeks to implement a different roster (notwithstanding that majority agreement under clause 14 was not obtained) then it may do so using clause 11.5. Clause 11.5(a) then comes into play. Pursuant to that clause BMA may seek to introduce a roster which may be the roster initially proposed by BMA (for which majority approval was not obtained) or another roster. At this point, in addition to meeting BMA’s business needs the roster sought by BMA must also facilitate employees’ preferred lifestyle arrangements. BMA may trial and implement this roster in accordance with the requirements of the Continuous Improvement process in clause 14 of the 2018 Agreement. In addition, to the clause 14 Continuous Improvement process BMA must also meet the specific requirements of clause 11.5.

[114] The additional specific requirements in clause 11.5 are that before proceeding to trial under clause 14 the Company must gauge support for changed roster requirements among affected employees in the relevant work area and other work areas working similar rosters. The relevant work area for the purposes of the process of gauging support is the work area in which the roster will be implemented as determined by the Company. There is no prescribed mechanism by which support is to be gauged. Information gained from gauging support for the proposed roster is then incorporated into the business reasons for the proposed change to the roster. Such information may also cause BMA to reconsider the roster it initially proposed and to propose a different roster based on the views of employees, which would make the Company’s proposal capable of acceptance by a larger number of employees.

[115] If the process of gauging support establishes that a significant number of employees desire a roster change, BMA can then implement the trial in accordance with the requirements in clause 14. In my view, the Company is required to again propose the change, notify it and provide business reasons. I have formed this view on the basis that the business reasons at this stage are informed by the process of gauging support for the roster as required by clause 11.5(b). It is also the case that clause 11.5(a) does not over-ride or remove any of the steps or requirements in clause 14 and makes clear that the requirements in clause 11.5 operate in addition to the requirements in clause 14.

[116] This construction of clauses 11.5 and 14 is based on the plain meaning of the text. It gives full effect to the relevant clauses and is consistent with their place in the 2018 Agreement. My view in relation to this matter is also supported by the contextual evidence about the negotiations for the 2012 Agreement generally and clause 11.5 in particular. That evidence is relevant to the extent that it establishes what the parties were negotiating about. It is also relevant to establishing the objective background facts which were known to both parties which inform the subject matter of the Agreement.

[117] In this regard it is apparent that BMA was negotiating about agreement provisions which allowed the Company to implement changed or new rosters as an alternative to the process described by the parties as the Continuous Improvement process which was provided for in clause 16 of the 2007 Agreement and carried over into the 2012 and then the 2018 Agreements in identical terms. BMA wanted the ability to introduce new rosters to meet its business needs and the right to implement those rosters. To this end BMA sought through a range of proposals to have a clause in the 2012 Agreement which allowed it to introduce rosters by giving notice to employees. The Company also sought an alternative provision to the Continuous Improvement process in clause 16 of the 2007 Agreement for the introduction of rosters on the basis of a view expressed by Mr Vickers on behalf of the CFMMEU during negotiations for the 2012 Agreement, to the effect that the Continuous Improvement process did not allow new rosters to be implemented unless they were agreed by a majority of employees. Mr Stelmach’s evidence about this matter – including that Mr Vickers stated that the CFMMEU would take BMA to the Federal Court if the Company sought to introduce rosters without majority agreement – was not challenged by Mr Vickers. Indeed, Mr Vickers maintained in his evidence that the continuous improvement clause in the 2007 Agreement (which was included in the 2012 and 2018 Agreements in the same terms) did not allow BMA to introduce new rosters without majority agreement. This assertion was also made in the written submissions initially filed by the CFMMEU in the present case.

[118] Regardless of whether or not this construction of the continuous improvement clause is correct, I accept that BMA had a genuine concern to avoid disputation about the use of the Continuous Improvement clause and that this was one of the reasons for its insistence on an alternative clause which allowed for new or changed rosters to be trialled and implemented in the absence of majority agreement. It is also apparent that another reason for BMA seeking a clause allowing the Company to implement new or changed rosters was the need to accommodate employees who wished to commute between the Mines at which they were working and their homes.

[119] From the perspective of the SBU in the negotiations for the 2012 Agreement, there was a recognition that while the majority of members favoured residential lifestyle arrangements and related rosters, and feared the impact of an increase in numbers of employees commuting on local communities, there was also a significant minority of members who wished to commute and wanted rosters to support this lifestyle choice. The Unions constituting the SBU also did not wish to give BMA complete control over rosters and wished to at least maintain current provisions to the extent that they restricted BMA’s ability to implement rosters without the agreement of a majority of employees. In this regard, I accept the evidence of Mr Vickers that achieving this balancing act was a significant issue for the SBU.

[120] I am also of the view that given the CFMMEU’s position about rosters and its opposition to what it saw as BMA’s desire for complete control over changes to rosters, it would have been reasonable for the Union to be concerned that its construction of the Continuous Improvement clause in the 2007 Agreement to the effect that new rosters could only be implemented with majority agreement, was not correct. In this regard it is arguable that prior to the introduction of clause 11.5 of the 2012 Agreement, BMA could have used the Continuous Improvement process in clause 16 of the 2007 Agreement (which became clause 14 of the 2012 and 2018 Agreements) to trial and implement a roster for business efficiency reasons, subject only to disputes that employees may have raised at two points in the trial process on the ground that the change was harsh, unreasonable or unjust. That the CFMMEU had a concern about this is apparent from the evidence that the Union sought to remove clause 14 and to place various restrictions on its use including that a majority of employees would be required to approve a change under the clause before it was implemented. The CFMMEU also resisted attempts by BMA to specifically list rosters as one of the matters that could be changed by virtue of the Continuous Improvement clause.

[121] In this context clause 11.5 of the 2012 Agreement resulted in every player getting a prize. The CFMMEU achieved a clause which balanced the competing views of a majority of its members who favoured residential rosters with the views of a significant number of members (albeit the minority) who wished to reside outside of regional communities in proximity to the Mines and commute between their homes and the Mines. Clause 11.5 also put limitations on the ability of BMA to implement rosters to meet its business needs by requiring that rosters which were not agreed by a majority of employees could only be introduced under that clause where a significant number of employees desired changes and where the proposed roster also facilitated employees’ preferred lifestyle arrangements. Clause 11.5 gave BMA an alternative to clause 14 to introduce roster changes and the right to introduce different rosters to meet business needs subject to meeting the other requirements of the clause, including that rosters would also facilitate employees’ preferred lifestyle arrangements.

[122] I do not accept that submission that the CFMMEU would not have given up the right to have a majority of employees approve a roster change in favour of a clause that allowed a roster change to be trialled and implemented with the agreement of less than a majority of employees. This assertion is based on an arguably incorrect construction of the Continuous Improvement process that was clause 16 of the 2007 Agreement and became clause 14 of the 2012 and 2018 Agreements. For the reasons given above, I am of the view that the CFMMEU would have been concerned that clause 16 of the 2007 Agreement did allow BMA to force through a roster change for business reasons in circumstances where a majority of employees did not agree, conditioned only by the right of the employees to bring a dispute to the Commission on the grounds that the change was harsh, unreasonable and unjust. In particular I note that the Continuous Improvement clause does not stipulate any minimum number of employees who must be in favour of a change sought to be progressed under the clause and even in the face of a majority of employees opposing a change under the clause, it is arguable that BMA can proceed to trial and implement the change. Seen in this light, the new clause 11.5 in the 2012 Agreement introduced the concept that absent majority agreement a roster change could not be trialled unless a significant number of employees agreed and the new roster facilitated employee lifestyle arrangement. This was arguably an improvement on the previous provisions of clause 16 of the 2007 Agreement from the perspective of the SBU and a compromise on the part of BMA.

What is a significant number of employees for the purposes of clause 11.5?

[123] Questions 3 and 4 require consideration of what constitutes a “significant number” of employees for the purpose of the introduction of a roster trial. As previously stated, the fact that a roster change can be implemented with the agreement of a majority of employees indicates that a significant number is less than the majority. I accept that the plain meaning of the term “significant number” means a number that is noteworthy, important or consequential. The evidence of the circumstances in which clause 11.5 was negotiated, establishes that:

• The SBU knew that there was a not insignificant number of employees who wanted to work under commute rosters; and

• BMA informed the SBU that its estimation was that 30 – 40% of employees were commuting and wanted rosters to support this.

[124] I also accept that what constitutes a significant number of employees may vary depending on the group of employees for whom a roster change is being considered. However, as a general rule, 30% of a group is in my view a significant number and for the purposes of determining the questions for arbitration and the present dispute it is the quantum I intend to adopt. This proportion of employees desiring a roster change is consistent with the terms of the Memorandum of Understanding reached in mediation whereby it was accepted that the outcome of the process set out in the roster clause in the 2012 Agreement may be that some employees will be required to work on rosters that are inconsistent with their original terms of contract and existing rosters.

CONCLUSIONS

[125] Question 1 asks how a relevant work area is determined. The answer to that question is that a relevant work area is a work area determined by BMA at its absolute discretion for the purposes of seeking to trial and implement a roster change under clause 11.5 provided that such area cannot be the whole Mine or a single employee.

[126] Question 2 asks for a determination of the process that should be followed by BMA to introduce a trial of a roster where there are a significant number of employees who support the change. The answer to that question is:

1. BMA may introduce a new or changed roster to meet its business needs.

2. In deciding to introduce a new roster BMA may define and select a work area (other than the whole Mine or a single employee) at its discretion for the purposes of determining where the new or changed roster will apply;

3. BMA will provide written notification of the new roster to affected employees and their representatives where requested, including the business reasons for the change and the duration of the trial.

4. Where a majority of affected employees agree with the proposed roster the roster may be implemented.

5. Where a majority do not agree as provided in clause 14 Continuous Improvement, BMA may seek to introduce a roster as described in clause 11.5(a) which facilitates employees’ preferred lifestyle arrangements and meets the needs of the business. This roster may be the same roster as originally proposed and rejected by a majority of employees or a different roster.

6. If it decides to proceed with the new roster BMA will engage in a process to gauge the support for changed roster arrangements among affected employees in the relevant work area.

7. If a significant number of employees (at least 30%) in the relevant work area agree and the proposed roster facilitates employees preferred lifestyle arrangements, BMA may proceed to trial the roster (or a variation of the roster informed by the views of employees) in accordance with the requirements of clause 14.

8. Before proceeding to trial the roster BMA must again meet the requirements in clause (a) to give written notification to the affected employees and their representatives including the business reasons as informed by information gained during the process of gauging support for the roster.

9. BMA may then proceed to trial the roster as provided for in clause 14(d) and (e).

10. The provisions of clauses 14(f), (g), (h) and (i) apply to the trial and implementation process.

[127] In response to Question 3, I answer “Yes” on the basis that 16 out of 45 employees voting in favour of a roster change is a significant number of employees for the purposes of clause 11.5 of the 2012 Agreement. In relation to question 4:

(a) 5 formal votes in favour out of 23 employees is not a significant number;

(b) 10 formal votes in favour out of 42 employees is not a significant number;

(d) 59 formal votes in favour out of 171 employees is a significant number.

DEPUTY PRESIDENT

Appearances:

Mr A Bukarica on behalf of the CFMMEU.

Mr M Coonan of Herbert Smith Freehills on behalf of BMA.

Hearing details:

14 December.

2018.

Brisbane.

Printed by authority of the Commonwealth Government Printer

1 Exhibit A3 – Witness Statement of Andrew Vickers; Exhibit A4 – Second Witness Statement of Andrew Vickers.

2 Exhibit A1 - Witness Statement of Simon West; Exhibit A2 – Third Witness Statement of Simon West.

3 Exhibit R1 – Statement of Shaun McKenzie.

4 Exhibit R2 – Statement of Peter Stelmach.

5 Exhibit R3 – Statement of Matthew Brady.

6 [2017] FWCFB 3005 at [14].

7 [2017] FWCFB 4487.

8 [2014] NSWCA 184 at [71] – [85].

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

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

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

12 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)

13 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].

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

15 Kucks v CSR Limited (1996) 66 IR 182 at 184.

16 Application by BHP Coal Pty Ltd t/as BHP Billiton Mitsubishi Alliance [2012] FWAA 9201 at [3].

17 This agreement was reached in relation to paragraphs 40 – 59 and 65 – 108.

18 Second Statement of Simon West [52] “SW7”.

19 Exhibit A3 Statement of Andrew Vickers Annexure AV1.

20 Exhibit A3 Statement of Andrew Vickers Annexure AV2.

21 Ibid AV2.

22 Ibid AV3.

23 Exhibit A4 second witness statement of Andrew Vickers.

24 Ibid AV5.

25 Ibid AV6.

26 Ibid AV6 Clause 13.5.

27 Ibid AV7.

28 Ibid AV9.

29 Ibid AV9.

30 Ibid AV10.

31 Ibid AV11.

32 Ibid AV13.

33 Ibid AV14.

34 Ibid AV15.

35 Ibid AV16.

36 Ibid AV16.

37 Exhibit R2 – Statement of Peter Stelmach Annexure PS1.

38 Exhibit R2 – Statement of Peter Stelmach Annexure PS2.

39 Ibid Annexure PS3.

40 Ibid Annexure PS4.

41 Exhibit A2 – Third Witness Statement of Simon West.

42 Ibid Annexure SW21.

43 Ibid Annexure SW22.

44 Transcript PN654 – PN694.

45 Transcript PN649.

46 Exhibit R2 – Statement of Peter Stelmach Annexure PS1.

47 Ibid Annexure PS2.

48 Ibid Annexure PS3.

49 Ibid Annexure PS4.

50 Ibid Annexure PS5.

51 Ibid Annexure PS6.

52 Exhibit A3.

53 Exhibit A3 Annexure AV1.

54 [2018] FCA 1215 at [52].

Construction, Forestry, Maritime, Mining and Energy Union v BHP Coal Pty Ltd

[2019] FWC 2825

13 MAY 2019

DECISION