CPSU, the Community and Public Sector Union v Commonwealth of Australia
[2019] FCA 975
•21 June 2019
FEDERAL COURT OF AUSTRALIA
CPSU, the Community and Public Sector Union v Commonwealth of Australia [2019] FCA 975
File number: VID 1047 of 2018 Judge: O’CALLAGHAN J Date of judgment: 21 June 2019 Catchwords: INDUSTRIAL LAW – where employees paid a “sea‑going allowance” under Australian Customs and Border Protection Enterprise Agreement 2011-2014 – whether ss 470 and 471 of the Fair Work Act 2009 (Cth) required employer not to pay or reduce payments of sea-going allowances during time employees took protected industrial action Legislation: Fair Work Act 2009 (Cth) ss 470, 471 Cases cited: Construction Forestry Mining and Energy Union v Mammoet Australia Pty Ltd (2013) 248 CLR 619 Date of hearing: 22 March 2019 Registry: Victoria Division: Fair Work Division National Practice Area: Employment & Industrial Relations Category: Catchwords Number of paragraphs: 43 Counsel for the Applicant: J Fetter Solicitor for the Applicant: S Kemppi of the CPSU, the Community and Public Sector Union Counsel for the Respondent: C Dowsett Solicitor for the Respondent: Australian Government Solicitor ORDERS
VID 1047 of 2018 BETWEEN: CPSU, THE COMMUNITY AND PUBLIC SECTOR UNION
Applicant
AND: COMMONWEALTH OF AUSTRALIA (AS REPRESENTED BY THE DEPARTMENT OF HOME AFFAIRS)
Respondent
JUDGE:
O’CALLAGHAN J
DATE OF ORDER:
21 june 2019
THE COURT ORDERS THAT:
1.The application is dismissed.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
O’CALLAGHAN J:
Introduction
The CPSU, the Community and Public Sector Union (the applicant) is an employee organisation within the meaning of the Fair Work Act 2009 (Cth) (the FW Act) and is entitled to represent the industrial interests of a number of “sea-going marine employees” assigned to sea-going marine employee positions on certain “sea-going” vessels (the employees).
The employees were employed by the Commonwealth of Australia (the respondent) in its Australian Customs and Border Protection Service (Customs and Border Protection).
Their employment was regulated by an enterprise agreement entitled the Australian Customs and Border Protection Enterprise Agreement 2011-2014 (the Agreement), which is and was at all material times an enterprise agreement made under the FW Act.
On a number of occasions in 2015 and 2016 the applicant gave notice to take protected industrial action in the form of bans upon the performance of certain work.
On eight occasions between 5 June 2015 and 17 September 2015 the applicant gave notice to the respondent that its members employed by the respondent in Customs and Border Protection intended to take protected industrial action in the form of bans upon the performance of certain work.
The relevant employees engaged in the protected industrial action on various dates between 18 June 2017 and 30 September 2015.
That protected industrial action constituted a partial work ban as defined by s 470(3) of the FW Act.
On three occasions between 14 September 2015 and 15 March 2016, the applicant gave notice to the respondent that its members employed by the respondent in Customs and Border Protection intended to take protected industrial action in the form of work stoppages.
The relevant employees engaged in the protected industrial action and did not perform work at various times between 24 September 2015 and 31 March 2016.
The respondent applied reductions to the “Sea-going Commuted Allowance” (the Allowance) payments paid under the Agreement in reliance on s 470 of the FW Act (in relation to the work stoppages) and s 471 of the FW Act (in relation to the partial work bans).
The single issue for decision is whether the respondent was required by ss 470 and 471 of the FW Act not to pay or to reduce the allowance paid to those employees in relation to periods during which they took protected industrial action.
The detailed facts, to which it is otherwise unnecessary to refer for the purposes of resolving that issue, are contained in a Statement of Agreed Facts, which is Annexure A to these reasons.
The Agreement
Clause 14.1 of the Agreement provides that there shall be a “salary” for each employee, “as specified in this Agreement”. Clause 14.4 provides for the “Rates of pay” applicable to each APS Classification.
The Agreement provides for a number of different remuneration amounts which are paid in addition to salary, including a bonus (clauses 14.1.12-14.1.17), superannuation (clause 14.3); shift penalties (clause 15.3.5), and overtime penalty payments (clause 15.4.6).
A number of allowances are also payable, including special allowances for senior employees (for travel, parking and home garaging) (clauses 14.5-14.6), approximately 30 different allowances for general staff (clause 18), clothing allowances (clause 19), and travel and reassignment allowances (clause 20).
Some allowances, such as the “Motor Vehicle Allowance” (clause 18.23), are, in fact, clearly paid by way of reimbursement. A “Cold Work Disability Allowance” (clause 18.4) is paid for each hour that the employee is required to perform work in cold places. A “First Aid Allowance” (clause 18.15) is paid, weekly, to any person appointed to the role of First Aid Officer.
Clause 22 establishes special conditions for the Marine Unit, in which the employees the subject of this proceeding worked.
Employees in the Marine Unit are normally rostered to work, at sea, for 191 days each year, in stretches of 22 or 28 consecutive duty days (clauses 22.4.1-22.4.3), but up to 36 days in a row for tactical or emergency reasons (clause 22.6).
While at sea, the employees are not limited to working 36.75 hours per week plus reasonable overtime, as is the case for land-based employees (clause 15.1.1(a)). They must work all “necessary” hours, but which the Commanding Officer will endeavour to limit to 14 hours per day (clause 22.7.2).
Working for long hours at sea, policing Australia’s maritime border (with all that entails), is obviously a significant disability. It is “in recognition of the special duties performed” that the Allowance is paid, as well as the fact that the overtime penalty payments, shift penalties, and other disability allowances which would normally apply will not be paid (clauses 22.8.1, 22.8.3, and 22.8.6).
The Allowance is paid to those who are assigned to a position on a sea-going vessel (clauses 22.8.1, 22.8.3, 22.8.6, and 22.8.10). It remains payable until such time as the Commonwealth withdraws it on the ground of failure to maintain mandatory qualifications and clearances (clause 22.8.10), or until such time as the employee ceases to be “available to go to sea” (clause 22.8.11).
The Allowance is worth 60-63% of the annual salary, depending on the class of vessel to which the employee is assigned. It is paid in fortnightly instalments.
It is convenient here to set out the directly relevant parts of the Agreement around which the controversy the subject of this proceeding is centred:
14. Classification and Pay
14.1 Remuneration Strategy
14.1.1An employee’s salary is the point within the minimum and maximum rates for the employee’s classification as specified in this Agreement, determined under Customs and Border Protection Performance Assessment and Feedback (PAF) System. The employee’s rate of pay will be salary for all purposes, including superannuation (subject to the relevant superannuation scheme rules), overtime, severance, and termination payments. Participation in salary sacrifice arrangements or purchased leave options will not affect salary for these purposes.
…
22.4 Working Patterns
22.4.1 For Bay Class vessels, ordinary duty will normally be rostered over:
•22 days rostered duty on and 20 days off.
22.4.2For other Customs and Border Protection sea-going vessels, with the exception of Southern Ocean patrols (Clause 22.31), ordinary duty will normally be rostered over:
•28 days rostered duty on and 28 days off.
22.4.3Operational planning within the roster cycle will be on the basis of a duty requirement for each sea-going marine employee equating to 191 days each financial year, comprising:
•186 rostered duty days; and
•Five administrative support days (50 hours).
22.4.4Administrative Support Days are in recognition of tasks listed at clause 22.4.6 of this Agreement for which overtime, time off in lieu or penalty payment would have ordinarily applied.
22.4.5This period includes approved paid leave. This clause will not apply to single continuous periods of voluntary training over 28 days.
…
22.8 Sea-Going Commuted Allowance
Sea-going Commuted Allowance for Sea-going Marine Employees normally assigned to a position on a Bay Class Vessels (sic)
22.8.1Sea-going marine employees normally assigned to a position on a Bay Class vessels will receive sea-going commuted allowance in recognition of the special duties performed and in lieu of any overtime, shift penalty, restricted duty and disability allowance provisions, where these would normally apply, contained in this Agreement unless otherwise specified in this Part which would otherwise be payable in respect of up to 191 duty days per financial year.
22.8.2The sea-going commuted allowance will be calculated as 60% of the employee’s annual salary and will be paid each fortnight in accordance with the following formula:
60% x Base Salary x 12
313Sea-going Commuted Allowance for Sea-going Marine Employees normally assigned to a position on other Customs and Border Protection sea-going vessels, with the exception of Bay Class and Cape Class vessels
22.8.3Sea-going marine employees normally assigned to a position on other Customs and Border Protection sea-going vessels, with the exception of Bay Class and Cape Class vessels, will receive sea-going commuted allowance in recognition of the special duties performed and in lieu of any overtime, shift penalty, restricted duty and disability allowance provisions, where these would normally apply, contained in this Agreement unless otherwise specified in this Part which would otherwise be payable in respect of up to 191 duty days per financial year.
22.8.4The sea-going commuted allowance will be calculated as 62% of the sea-going marine employee’s annual salary and will be paid each fortnight in accordance with the following formula:
62% x Base Salary x 12
31322.8.5Additionally, the sea-going commuted allowance is paid in recognition that the sea- going marine employee will ordinarily undertake 28 day patrols and any patrol extensions.
Sea-going Commuted Allowance for Sea-going Marine Employees normally assigned to a position on a Cape Class vessel
22.8.6On transition to a Cape Class vessel sea-going marine employees normally assigned to a position on a Cape Class vessel will receive sea-going commuted allowance in recognition of the special duties performed and in lieu of any overtime, shift penalty, restricted duty and disability allowance provisions, where these would normally apply, contained in this Agreement unless otherwise specified in this Part which would otherwise be payable in respect of up to 191 duty days per financial year.
…
22.8.10The sea-going commuted allowance will only be payable if a sea-going marine employee:
•maintains mandatory qualifications and required competencies including medical and fitness requirements, Use of Force permit (if applicable) and security clearance; and
•is assigned to a designated sea-going marine employee position.
Failure to maintain such standards may result in the cessation of the sea-going commuted allowance.
22.8.11The sea-going commuted allowance will be paid to sea-going marine employees who are available to go to sea regardless of the number of days sea duty actually performed and in respect of:
•periods during which a sea-going marine employee is deployed to marine-related duties;
•Employee initiated Marine Unit approved training courses for a single continuous period not exceeding 28 calendar days;
•Management Initiated Marine Unit approved training courses;
•annual leave utilised during periods of service as a sea-going marine employee which includes periods of annual leave taken at the completion of Marine Unit approved training;
•paid leave provided in accordance with the Defence Reserve Service (Protection) Act 2001; and
•all other forms of paid leave up to a maximum of 18 days in any one financial year.
22.8.12The sea-going commuted allowance will count as an allowance for superannuation purposes where it is received on a regular basis, i.e., for a continuous period of 12 months and 1 day or where it has been certified by Customs and Border Protection that the allowance is likely to be received continuously for at least 12 months.
22.9 Pro-rata Payments
22.9.1Where unpaid leave or more than 180 hours of paid leave (other than annual leave) is taken in a financial year, the sea-going commuted allowance will be deducted based on the number of rostered hours of duty on each day of leave in accordance with the following formula:
Fortnightly rate of allowance x Number of hours of leave
73.5…
22.13 Temporary Sea-going Marine Employees
22.13.1Where an employee is required to perform marine training or marine standards duties on board a sea-going vessel, the employee will meet the definition of Temporary Sea-going Marine Employee.
…
22.13.6Temporary sea-going marine employees will receive a sea-going commuted allowance calculated on a pro-rata basis for each sea day in accordance with the following formula:
Base Salary x 60%
173The FW Act provisions
Section 470 of the FW Act provides:
470 Payments not to be made relating to certain periods of industrial action
(1)If an employee engaged, or engages, in protected industrial action against an employer on a day, the employer must not make a payment to an employee in relation to the total duration of the industrial action on that day.
(2) However, this section does not apply to a partial work ban.
(3) A partial work ban is industrial action that is not:
(a) a failure or refusal by an employee to attend for work; or
(b)a failure or refusal by an employee who attends for work to perform any work at all; or
(c) an overtime ban.
(4)If the industrial action is, or includes, an overtime ban, this section does not apply, in relation to a period of overtime to which the ban applies, unless:
(a)the employer requested or required the employee to work the period of overtime; and
(b) the employee refused to work the period of overtime; and
(c)the refusal was a contravention of the employee’s obligations under a modern award, enterprise agreement or contract of employment.
(5) If:
(a) the industrial action is, or includes, an overtime ban; and
(b)this section applies in relation to a period of overtime to which the ban applies;
then for the purposes of this section, the total duration of the industrial action is, or includes, the period of overtime to which the ban applies.
Section 471 of the FW Act provides:
471 Payments relating to partial work bans
Employer gives notice of reduction in payments
(1) If:
(a)an employee engaged, or engages, in protected industrial action against an employer on a day; and
(b) the industrial action is a partial work ban; and
(c)the employer gives to the employee a written notice stating that, because of the ban, the employee’s payments will be reduced by a proportion specified in the notice;
then the employee’s payments are reduced in accordance with subsection (2) in relation to the period (the industrial action period) referred to in subsection (5).
(2) The employee’s payments in relation to the industrial action period are reduced:
(a) by the proportion specified in the notice; or
(b)if the FWC has ordered a different proportion under section 472—by the proportion specified in the order;
and the modern award, enterprise agreement or contract of employment that applies to the employee’s employment has effect accordingly.
(3)The regulations may prescribe how the proportion referred to in paragraph (2)(a) is to be worked out.
Employer gives notice of non-payment
(4) If:
(a)an employee engaged, or engages, in protected industrial action against an employer on a day; and
(b) the industrial action is a partial work ban; and
(c)the employer gives to the employee a written notice stating that, because of the ban:
(i) the employee will not be entitled to any payments; and
(ii)the employer refuses to accept the performance of any work by the employee until the employee is prepared to perform all of his or her normal duties;
then the employee is not entitled to any payments in relation to the period (the industrial action period) referred to in subsection (5).
(4A) If:
(a)an employer has given an employee a notice under paragraph (4)(c); and
(b)the employee fails or refuses to attend for work, or fails or refuses to perform any work at all if he or she attends for work, during the industrial action period;
then:
(c)the failure or refusal is employee claim action, even if it does not satisfy subsections 409(2) and 413(4), if the related industrial action referred to in paragraph (4)(a) is employee claim action; or
(d)the failure or refusal is employee response action, even if it does not satisfy subsection 413(4), if the related industrial action referred to in paragraph (4)(a) is employee response action.
The industrial action period
(5) The industrial action period is the period:
(a) starting at the later of:
(i)the start of the first day on which the employee implemented the partial work ban; or
(ii)the start of the next day, after the day on which the notice was given, on which the employee performs work; and
(b) ending at the end of the day on which the ban ceases.
Form and content of notice
(6)The regulations may prescribe requirements relating to one or both of the following:
(a) the form of a notice given under paragraph (1)(c) or (4)(c);
(b) the content of such a notice.
Manner of giving notice
(7)Without limiting paragraph (1)(c) or (4)(c), the employer is taken to have given a notice in accordance with that paragraph to the employee if the employer:
(a)has taken all reasonable steps to ensure that the employee, and the employee’s bargaining representative (if any), receives the notice; and
(b)has complied with any requirements, relating to the giving of the notice, prescribed by the regulations.
Employer does not give notice
(8) If:
(a)an employee engaged, or engages, in protected industrial action against an employer on a day; and
(b) the industrial action is a partial work ban; and
(c)the employer does not give the employee a notice in accordance with paragraph (1)(c) or (4)(c);
then the employee’s payments for the day are not to be reduced because of the ban.
The applicant’s case
At the heart of the applicant’s case is its contention that the High Court’s decision in Construction Forestry Mining and Energy Union v Mammoet Australia Pty Ltd (2013) 248 CLR 619 (Mammoet’s Case) held that s 470(1) only prohibits payments that depend “on the actual performance of services” and does not prohibit other payments, such as the accommodation allowance in that case, which payment was not linked to the performance of work but rather was “dependent on the subsistence of the contract of employment”. The applicant submits that, “like s 470, the reference to ‘payments’ in s 471 must be understood as referring only to payments which ‘depend on the actual performance of services’”.
Counsel for the applicant put his central proposition in his written submissions as follows:
25.Critically for the resolution of this proceeding, it is clear that the Allowance is not earned by the “actual performance of work”. Rather, the Allowance is paid to those who are “assigned” to a position on a sea-going vessel (cl 22.8.1, 22.8.3, 22.8.6, also 22.8.10 2nd dot point). The Allowance remains payable until such time as the Commonwealth withdraws the Allowance on ground of failure to maintain mandatory qualifications and clearances (cl 22.8.10), or until such time as the employee ceases to be “available to go to sea” (cl 22.8.11), as might occur if they die, leave their employment or take extended leave.
26.The CPSU submits that the six dot points in clause 22.8.11 are merely illustrations of the circumstances in which an employee is (or is to be deemed as) available to go to sea, and that the dot points do not control the meaning of “available to go to sea”. In any event, the first dot point makes it clear that an employee is to receive the Allowance during any period in which they are “deployed to marine-related duties”, and that was true for the Affected Employees at all relevant times.
(Emphasis in original).
The applicant also submitted that the “lack of connection between the Allowance and the actual performance of duty is reinforced by a number of other considerations” (emphasis in original), which may be summarised as follows:
(1)the Allowance is an annual allowance, which suggests there is no particular connection to the number of hours performed in the year;
(2)clause 22.8.11 says that the Allowance is paid “regardless of the number of days’ sea duty actually performed”, and is paid when employees are not performing work because they are on leave;
(3)if the Allowance depended on actual hours performed in a pay period, one would expect to see a mechanism for making adjustments to the Allowance for time not worked;
(4)the Allowance is to be contrasted with the “commuted” allowance for land-based employees who are temporarily “required” to perform duties at sea (clause 22.13.1), which is calculated on a “pro-rata basis for each sea day” (clause 22.13.6) – it is conceded that because the temporary allowance is triggered by the “requirement” to work on a particular “sea day” a failure or refusal to perform the work required in that case would disentitle the employee to the allowance for the day in question;
(5)“it is entirely understandable … why the parties would wish to have a fixed annual Allowance, not calibrated to working hours … . it removes the need to keep detailed records of working time, and for payroll to make regular calculations … [A] fixed sum allows [employees] a constant income, which is useful for planning purposes.”
In my view, these submissions are, with respect, beside the point. Their premise – that s 471 must be understood as referring only to payments which depend “on the actual performance of services” – is incorrect, because the authority upon which that proposition is said to be founded, namely Mammoet’s Case, does not support it.
Mammoet’s Case
Mammoet’s Case was a case in which employees worked pursuant to “fly in/fly out” arrangements. The respondent was notified of the intention of relevant employees to engage in industrial action as part of the process of negotiating an enterprise agreement with the respondent under the FW Act. Under the Mammoet Australia Pty Ltd Pluto Project Greenfields Agreement 2008, the employer was obliged either to provide the employees with suitable accommodation or to pay a living away from home allowance. The respondent chose to provide their accommodation. In response to the notification of an intention to engage in industrial action, “the respondent informed the relevant employees that, for the duration of any protected industrial action, the respondent would cease to pay for the relevant employees’ accommodation. The respondent required the relevant employees to vacate their accommodation [by 6.30am the next morning] unless they made their own arrangements directly with the management of the accommodation” (Mammoet’s Case at 624, [16]).
The CFMEU applied to the Federal Magistrates Court, seeking relief on the basis that the respondent’s refusal to provide accommodation contravened the Agreement and constituted adverse action against the relevant employees within the meaning of s 342(1) of the FW Act, in contravention of s 340(1). The magistrate dismissed the application on the basis that the respondent had no case to answer because the provision of accommodation was the making of a payment prohibited by s 470(1) of the FW Act.
The CFMEU appealed, unsuccessfully, to a single judge of the Federal Court, and then to the High Court, by a grant of special leave. The High Court allowed the appeal, reasoning relevantly as follows at 625-626:
20.… Section 470(1) … prohibits an employer making a payment to an employee in relation to the total duration of protected industrial action which an employee engaged or engages in on a day. Section 473 prohibits an employee from accepting, and an employee or employee organisation from asking for, a payment from an employer which would contravene s 470(1). Section 474(1) correspondingly prohibits an employer making a payment to an employee who engaged or engages on a day in any industrial action that is not protected industrial action (the prohibition is on payment to the employee “in relation to ... the total duration of the industrial action” if that duration was at least four hours, and otherwise “in relation to ... 4 hours of that day”) and s 475 correspondingly prohibits an employee from accepting, and an employee or employee organisation from asking for, a payment from an employer which would contravene s 474(1). Sections 470(1), 473, 474(1) and 475 are all civil remedy provisions, contravention of which gives rise to liability to penalty under s 539 of the Act.
21.Section 470(1), by s 470(2), does not apply to a partial work ban. Protected industrial action that amounts to a partial work ban in which an employee engaged or engages against an employer on a day is dealt with in s 471. That section allows the employer, by written notice to the employee, proportionately to reduce the employee’s payments in relation to the period starting at the start of the first day on which the employee implemented the partial work ban (or the start of the next day on which the employee performs work after the day on which the notice was given if that is later) and ending at the end of the day on which the ban ceases.
Under the heading “In relation to the total duration of the industrial action”, the Court explained at 635-636:
50.Section 470(1) prohibits the making of “a payment to an employee in relation to the total duration of the industrial action on that day”. That is a prohibition upon the making of a payment to recoup, in whole or in part, what would have been payable in relation to the time during which the employee engaged in industrial action had the employee worked during that period.
51.An employee who engages in industrial action does not, for the duration of the industrial action, render the services on which the entitlement to remuneration commonly depends. But to say that is distinctly not to say that entitlements of an employee which are dependent on the subsistence of the contract of employment, rather than the actual performance of services, even if sensibly described as “payments”, are “payment[s] ... in relation to the total duration of the industrial action”. To speak of “a payment to an employee in relation to the total duration of the industrial action” is to speak of a period of employment in respect of which no remuneration is earned by the employee. The concern addressed by s 470(1) of the Act is that the taking of industrial action must not be the occasion of a payment by the employer. The obligation to provide accommodation was not the occasion of the industrial action taken by the relevant employees.
52.The legislative history confirms that the relationship between payment and industrial action contemplated by s 470(1) is that the non-performance of work by the employee is the occasion of the proscribed payment. These indications support the view that the purpose of the provision is to prohibit “strike pay”, that is, payments by an employer to “make up”, in whole or in part, wages not earned by the employee during the period of industrial action.
At 637 the Court continued:
59.The legislative history, the Second Reading Speech, and the observations of Ryan J point strongly to the conclusion that the mischief at which s 470(1) is directed is the payment of strike pay, that is, the making of payments whose relationship to industrial action is to be found in the recoupment of wages lost during the period of the action. There is no suggestion that the purpose of s 470(1) is to suspend the entirety of the employer’s obligations under the relationship of employment. Indeed, the Act contemplates the continued subsistence of the employment relationship during and after the industrial action.
60.Whether the prohibition is apt to capture any given payment may depend on the circumstances of the case. For example, a payment by way of a gift might be caught if the circumstances were such as to show that it was made by way of recompense for wages not earned. It is not necessary or desirable to attempt an exhaustive statement of those circumstances.
61.It is sufficient for the purposes of this case to say that the entitlement of the relevant employees to accommodation was established under cl 6 of Appendix 7 of the Agreement. The provision of that accommodation was a benefit to which the relevant employees were entitled upon attending at the work site unless and until they were directed to return to their usual place of residence. It was neither a payment of money, nor provided in relation to the non-performance of work during the period of industrial action.
The parties agreed that the reasoning of the High Court in relation to s 470 applies equally to s 471.
Consideration
The provision of accommodation the subject of Mammoet’s Case was, as the High Court found, neither a payment, nor was it provided in relation to the non-performance of work during a period of industrial action. So the facts are far removed from this case.
The purpose of ss 470 and 471, as the High Court said (at 635-636, [52]), is “to prohibit ‘strike pay’, that is, payments by an employer to ‘make up’, in whole or in part, wages not earned by the employee during the period of industrial action”.
The Allowance in this case was obviously a “payment”. And if it had been paid during the period of industrial action it would have been a payment to make up wages not earned. Those payments were thus proscribed.
It is convenient to repeat the part of the particular paragraph of Mammoet’s Case upon which the applicant relies for the proposition that ss 470 and 471 only prohibit payments that depend on the actual performance of services, viz:
51.An employee who engages in industrial action does not, for the duration of the industrial action, render the services on which the entitlement to remuneration commonly depends. But to say that is distinctly not to say that entitlements of an employee which are dependent on the subsistence of the contract of employment, rather than the actual performance of services, even if sensibly described as “payments”, are “payment[s] ... in relation to the total duration of the industrial action” …
The phrase “the actual performance of services” is used in contradistinction to “entitlements of an employee which are dependent on the subsistence of the contract of employment”, such as accommodation, or (as Senior Counsel for the CFMEU is recorded as having submitted in Mammoet’s Case at 620) cars, mobile phones disability care, workplace childcare or free parking. The phrase “the actual performance of services” does not have the importance attributed to it by the applicant, because that would be to substitute for the actual words of the legislation a phrase nowhere found in it. The test posed by ss 470 and 471 is, as the High Court said, whether the payment (here, the Allowance) is “a payment to recoup, in whole or in part, what would have been payable in relation to the time during which the employee[s] engaged in industrial action had the employee[s] worked during that period”?
Once that is identified as the correct question to pose, it seems to me, with respect, that the answer is tolerably clear. The Allowance is calculated by reference to “base salary”. The percentage of base salary used in the calculation, and therefore the amount of the Allowance, varies depending upon the class of ship to which a sea-going marine employee is assigned. And it is expressly paid: “… in recognition of the special duties performed and in lieu of any overtime, shift penalty, restricted duty or disability allowance provisions, where these would normally apply, contained in this Agreement unless otherwise specified in this Part which would otherwise be payable in respect of up to 191 duty days per financial year” (clauses 28.8.1, 22.8.3, and 22.8.6).
Payments to employees who: perform overtime (clause 15.4) or shift work (clause 15.3); are directed to remain contactable and available to perform extra duty outside their ordinary hours of work (clause 18.25); or suffer a recognised disadvantage or disability in the performance of their work (for example, a cold work disability (clause 18.4), a confined space disability (clause 18.7), or a dirty or offensive work disability (clause 18.11)), are obviously payments that, if withheld, “would have been payable in relation to the time during which the employee[s] engaged in industrial action had the employee[s] worked during that period”. Such payments do not lose that character when they are consolidated into a single commuted allowance.
The Allowance also only applies up to 191 duty days per year. That is the number of days likely to be worked in the ordinary course of things. It is made up of 186 rostered days and 5 administrative support days. Work performed in excess of 191 days attracts any applicable overtime and shift penalty, among other things. Again, those are further indicators, if any were needed, of the Allowance being a payment of the kind proscribed by ss 470 and 471.
I certify that the preceding forty-three (43) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice O’Callaghan. Associate:
Dated: 21 June 2019
ANNEXURE A
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