CPSU, the Community and Public Sector Union v Royal Flying Doctor Service of Australia Central Operations
[2016] FWC 3796
•22 JULY 2016
| [2016] FWC 3796 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.739 - Application to deal with a dispute
CPSU, the Community and Public Sector Union
v
Royal Flying Doctor Service of Australia Central Operations
(C2016/2603)
ROYAL FLYING DOCTOR SERVICE, CENTRAL OPERATIONS, OPERATIONS CO-ORDINATORS AGREEMENT 2014 Airline operations | |
COMMISSIONER HAMPTON | ADELAIDE, 22 JULY 2016 |
Dispute about any matters arising under the enterprise agreement and the NES – annual leave – agreed dispute resolution provision empowering Commission to determine matter – annual leave entitlement expressed in rostered working days – whether average ordinary working hours define the entitlement – principles considered – unique provisions of agreement – whether contrary common objective intention agreed during negotiations – ordinary and natural meaning of the provision in context applied.
1. The context for the dispute
[1] The CPSU, the Community and Public Sector Union, has made an application 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 term of an enterprise agreement.
[2] The application relies on the dispute resolution procedure set out in clause 34 of the Royal Flying Doctor Service, Central Operations, Operations Co-ordinators Agreement 2014 (the Enterprise Agreement).
[3] The Enterprise Agreement covers the Royal Flying Doctor Service of Australia, Central Operations (the RFDS), all Operations Co-ordinators employed by the RFDS at its Port Augusta Base, and the CPSU.
[4] Conciliation conferences were convened by the Commission on 23 February and 21 March 2016. The matter was not resolved and in accordance with the provisions of clause 34 the CPSU has sought that the subject matter of the application be determined by the Commission. It is common ground between the parties that the Commission has the necessary jurisdiction and power to do so.
2. What the dispute is about
[5] The RFDS, following consultation, is seeking to implement a revised roster for the Operations Co-ordinators. There are various potential options for the revised roster but each incorporates the view of the RFDS about the extent of annual leave entitlements under the Enterprise Agreement. That view also has a consequential impact upon the construction of the roster more generally including the rostered hours of work that are required of the employees.
[6] The annual leave entitlement arises from clause 17.1 of the Enterprise Agreement. Clause 17 provides as follows:
“17. ANNUAL LEAVE
17.1 All Operations Co-ordinators are entitled to 30 Rostered working days of annual leave in each 52-week period (pro rata for part-time Operations Co-ordinators). Leave shall accrue and be taken in accordance with the RFDS Leave Policy.
17.2 Annual leave is cumulative and unused leave is payable in lieu upon termination of employment.”
[7] The term “Rostered working days” is defined in clause 6.7 of the Enterprise Agreement as follows:
“Rostered working days means a day rostered on duty.”
[8] The ordinary hours of work are provided in clause 15 as follows:
“15. HOURS OF WORK
15.1 Ordinary hours shall not exceed an average of 38 hours per week over a cycle of shifts in accordance with a roster developed by the RFDS, in consultation with the Operations Co-ordinators. The current roster, which may be altered in accordance with Clause 15.3 below, is attached at Schedule B.
15.2 Every Operations Co-ordinator shall be entitled to a minimum 10-hour break between rostered periods of work.
15.3 Variations to the roster will be developed in consultation with the Operations Co-ordinators, and will occur at least seven days prior to any permanent roster changes.
15.4 Any difference between rostered hours and 38 hours may be used for staff development meetings, usually run every third week.
15.5 With the exception of the professional development/training sessions referred to in Clause 16, Operations Co-ordinators will be granted time off in lieu for attendance at RFDS provided training scheduled outside of their ordinary rostered hours.”
[9] The Operations Co-ordinators are remunerated on the basis of an annualised salary and this is provided in clause 10 in the following terms:
“10. SALARIES
10.1 Save and except where specifically provided for in this Agreement, the Operations Co-ordinators shall be paid in accordance with Schedule A of this Agreement.
10.2 The annual salary paid to Operations Co-ordinators under this Agreement shall constitute payment for all hours worked, and is inclusive of penalty rates (excepting overtime), allowances and annual leave loading.
10.3 Salaries shall be paid fortnightly by electronic funds transfer into a bank, building society, credit union or other financial institution account of the Operations Co-ordinators' choice.”
[10] It is common ground that under clause 15 of the Enterprise Agreement the RFDS may implement a revised roster having consulted with the employees. However, any such roster must comply with the terms of the Enterprise Agreement including the annual leave provisions.
[11] Furthermore, I note that reference is made to the RFDS Leave Policy in clause 17.1. At the hearing of this matter, it was also common ground that the RFDS Leave Policy is not relevant to determination of the substance of this dispute. I note, in that regard, that the RFDS did refer to the policy in supplementary submissions and I will return to this aspect.
[12] The CPSU contends that the annual leave entitlement should be calculated on the basis of the hours worked on a regular rostered shift. That is, based upon the present shift rosters - 30 days calculated at approximately 1 12 hours per day (being a day rostered on duty). This, in effect, equates to 365 hours.
[13] The RFDS’s contrary proposition is that annual leave should be calculated as 30 days at 7.6 hours per day, being the average ordinary hours of work for a day provided by clause 15 of the Enterprise Agreement. In terms of hours of annual leave, this equates to 228 hours. Alternatively, with the new roster proposal, the RFDS proposes that employees may have the option to take 19 days annual leave at 12 hours per day which would also equate to 228 hours.
3. The detailed positions of the parties
3.1 The CPSU
[14] It is the CPSU’s position that the RFDS has made an assumption, that annual leave under the Enterprise Agreement is to be calculated as 228 hours, and that this is not consistent with the provisions of the Enterprise Agreement and is a departure from long standing practice.
[15] The CPSU’s position relies on the fact that Operations Co-ordinators currently, and historically, perform a 12 hour 10 minute shift and further that when an employee has taken a day of annual leave, they have been paid in full for that day of leave without having to undertake additional work under the roster.
[16] It also contends that the annual leave entitlements have historically been expressed in rostered working days, not hours. However, if the entitlement were to be considered in hours, employees would be entitled under clause 17.1 to 365 hours which represents 30 days of the rostered 12 hour 10 minute shift.
[17] The CPSU relies on the principles set out in the Full Bench decision in Australasian Meat Industry Employees Union v Golden Cockerel Pty Limited, 2 (Golden Cockerel) and contends that the meaning of the disputed provisions is clear on their face, not ambiguous and not susceptible to more than one meaning. Therefore, evidence of the surrounding circumstances should not be admitted to determine ambiguity.
[18] In the alternative, the CPSU contends that if the Commission makes a finding of ambiguity in the provisions, the objective framework of fact would be admissible. However, any evidence of prior negotiations about clause 17 cannot satisfy the test as it would reflect subjective intentions or expectations of the parties.
[19] The CPSU also refers to the Full Bench decision in RACV Road Service Pty Ltd v Australian Municipal, Administrative, Clerical and Services Union 3 (RACV) and contends that this provides an example of when annual leave has been calculated on the basis of rostered hours in a situation where the roster cycle was averaged to 38 hours per week. The CPSU also note that the issues before the Full Bench in that matter had additional facts that would distinguish the outcome from the current dispute.
[20] In relation to context, the CPSU contends that clause 17 should be viewed in the context of other clauses and previous agreements. These include the “no extra claims” provision in clause 8 of the Enterprise Agreement.
[21] In that regard, the CPSU refers to the bargaining negotiations leading to the Enterprise Agreement where employees rejected the RFDS’s proposed change which sought to state in clause 17 that the annual leave entitlement would be calculated on the basis of 7.6 hours per annual leave day.
[22] The CPSU argues that clause 8 is intended to prevent the RFDS from doing exactly what it is now intending; that is, attempting to implement something it claimed in negotiations which was then withdrawn in order for an agreement to be reached.
[23] During the hearing, the CPSU dealt with the scenario where a roster was constructed on the basis of 5 hour shifts or even 9 or 10 hour shifts. It contends that the annual leave entitlement would remain the same as reflected in the 30 days. However, it would change in terms of the equivalent hours involved each time to reflect the change in the rostered hours on duty.
[24] It also addressed how the pro-rata basis for part-time employees would operate under its preferred approach. The CPSU submits that although there does not appear to be any current part-time employees, if there were, they would work a full 12 hour shift for a lesser number of days. For example, a part-time employee working half time would work 2 days instead of the 4 days per week as required for full-time employees. On this basis, it submits that part-time employees would be entitled to 15 days of annual leave (at 12 hours), instead of 30 days.
[25] Furthermore, it submits that if the RFDS’s approach and calculations were accepted, employees would be required to work for approximately 11 more days (132 hours) in a year than they are presently rostered. This would be a significant claim outside of the agreed outcomes reflected in the Enterprise Agreement.
[26] The CPSU led evidence from Ms Natalie Hartman, Industrial Officer of the CPSU and Ms Sharon Harbridge, an Operations Co-ordinator with the RFDS.
3.2 The RFDS
[27] The RFDS contends in effect that the annual leave entitlement provided for in the Enterprise Agreement is to be calculated at 7.6 hours per day.
[28] This approach is founded on the following propositions:
- the Operations Co-ordinators are entitled to an annualised salary under clause 12 of the Enterprise Agreement;
- in accordance with clause 15, the ordinary hours must be averaged to 38 hours per week over a cycle of shifts in accordance with a roster developed by the RFDS in consultation with the Operations Co-ordinators;
- the custom and practice of the RFDS has been to accrue and deduct 7.6 hours of annual leave per day; and
- the common objective intention of the parties during the bargaining negotiations supports the interpretation proposed by the RFDS.
[29] Consistent with this approach, the RFDS submits that the annual leave entitlements in clause 17 must be read in the context of other clauses of the Enterprise Agreement.
[30] It submits that the normal approach to the calculation of annual leave for an employee working 38 ordinary hours is 7.6 hours per day; and further, if the Enterprise Agreement intended to move off the normal path of construction, it must clearly state that it is doing so.
[31] The RFDS also contends that the entire basis of employment is predicated on the concept that Operations Co-ordinators work an average of 38 hours per week which equates to 1,976 hours per year. Furthermore, the roster is premised on the average ordinary working hours of 38 hours per week over a 52 week period.
[32] In relation to the effect of clause 8 of the Enterprise Agreement, the RFDS contends that the proposed roster change does not constitute an extra claim as its approach to the calculation of annual leave is already provided for in the Enterprise Agreement.
[33] In further support of its approach, the RFDS relies on what it contends to be the custom and practice of employees being paid for 1,976 hours per year which consists of 1,748 hours actually worked and 228 hours of paid annual leave.
[34] In terms of part-time Operations Co-ordinators, the RFDS suggested that these employees would be entitled to 30 days of annual leave but on a pro-rata basis according to their ordinary hours of work.
[35] The RFDS also rely on the fact that clause 17 of the Enterprise Agreement does not explicitly provide that employees are entitled to 30 Rostered working days of annual leave per year at 12 hours and 10 minutes per day, and further, that clause 17 does not provide for changes to the annual leave entitlement. Consequently, it suggests, where a roster is altered in accordance with clause 15, the annual leave entitlement should not be altered to accommodate for changes to the roster. An employee should not be advantaged or disadvantaged by the way in which the roster is constructed.
[36] The RFDS submits that if the Commission considers it necessary to give consideration to evidence of surrounding circumstances, the common objective intentions of the parties during the bargaining negotiations supports its interpretation of clause 17. This includes a statement of principles that was agreed by the parties in the context of finalising the version of the Enterprise Agreement that was ultimately proposed by the employer and approved by the employees.
[37] The RFDS led evidence from Mr Anthony Vaughan, ASM, its Chief Operating Officer.
4. The supplementary submissions
[38] After reviewing the submissions and evidence of both the CPSU and RFDS, I further inquired with the parties about an aspect of the evidence that did not appear to have been fully addressed.
[39] The request for further submissions concerned what appeared to be the present practice of applying the annual leave provision and the potential implications, if any, of that practice for the proper application of the Enterprise Agreement. This involved, in particular, the relationship between the provision of annual leave and the overall rostered hours.
[40] An example was provided to the parties on the basis of a current Operations Co-ordinator’s, Ms Harbridge’s, roster and annual leave record. The evidence before the Commission appeared to show that Ms Harbridge consistently worked 4 days on and 4-6 days off and that her leave record, for the past 5 years, recorded annual leave in 4 day increments. The following example and calculations were put to the parties:
“It is apparent that Ms Harbridge recently took annual leave from 18 April 2016 to 30 April 2016, a period of 13 calendar days. However, the leave record appears to have deducted a total of 8 days, 2 periods of 4 days each. Accordingly, it is apparently recorded that Ms Harbridge took 4 days annual leave from 18 April 2016 to 21 April 2016. It is assumed that she would have been entitled to her regular 4-6 days off, 22 April 2016 – 26 April 2016, and therefore this was not recorded. She then took a further period of annual leave, from 27 April 2016 – 30 April 2016, or, the next period that she would have been rostered to work.
Furthermore, on the basis of the current 9 week roster cycle in Schedule B, for a full-time Operations Co-ordinator it appears that:
- An Operations Co-ordinator works 28 days in one 9 week roster cycle.
- If roster cycles are 9 weeks, then there are 5.8 cycles in a 52 week period, which can also be converted to 161.8 days rostered.
- The 161.8 days are rostered on the basis of 12.17 hour shifts. This equates to 1,969 hours rostered in a 52 week period. This appears to be broadly consistent with the requirement to work ordinary hours of 38 hours per week (e.g. 1,969/52 = 37.86 hours per week).
- Operations Co-ordinators receive 30 rostered days of annual leave per year. Therefore, they actually work for 131.8 days at 12.17 hours per shift which is 1,604 hours.”
[41] Both parties provided further submissions which are summarised below.
[42] The CPSU confirmed that Ms Harbridge takes annual leave in 4 day blocks reflecting her rostered working days and reiterated that it was Ms Harbridge’s evidence during the hearing that when she took a day of leave, she received the full day off (12 hours 10 minutes) even though her leave record only recorded 7.6 hours off for each rostered working day.
[43] It accepts that on the basis of the current 9 week roster cycle, Ms Harbridge works 161.8 rostered days in a 52 week period. However, the CPSU added that this was accepted with the caveat that depending upon when the 52 week period is calculated to begin and end, and when rostered working days fall according to the roster, there could be some employees who work a day or 2 fewer or more during that period.
[44] The CPSU added that if the RFDS’s position is accepted, Operations Co-ordinators would receive 228 hours off the roster or would actually work 143.1 days at 12.17 hours; being 1,741.5 hours per annum. They would then receive approximately 19 days of annual leave, not 30 rostered working days, which would be contrary to clause 17.
[45] The CPSU confirmed its position that if the rostered hours in each rostered working day were to change, so would the number of hours arising from the leave entitlement. It notes however that the number of days would remain at 30 rostered working days. In support of this, the CPSU refers to previous agreements which had rostered days between 5 and 9 hours. It points out that other longer serving employees are likely to have always taken annual leave in terms of a rostered working day, regardless of the hours of the shift, and had 7.6 hours recorded by payroll.
[46] In its supplementary submissions, the CPSU also referred to the cases of RACV and Construction, Forestry, Mining and Energy Union v Anglo Coal 4 (Anglo Coal) as standing for the principle that confining leave entitlements to hours based on average ordinary hours of work, rather than hours actually worked, is contrary to the NES.
[47] It is the CPSU’s position that there is no inherent tension between the annual leave provision in rostered working days and the hours of work provision. The annual leave entitlement is accrued per annum on the basis of the average ordinary hours of work, being 38 hours per week, and is deducted as 30 rostered working days. It concludes, that the only tension that arises between the provisions is when the days of leave are translated into hours based on an average of ordinary working hours, as the RFDS is attempting to do, and rostered days of leave are then limited to that number of average ordinary hours.
[48] In its supplementary submissions, the RFDS confirmed that the Commission’s interpretation of the evidence in relation to Ms Harbridge’s annual leave record was correct. It agreed that if the current roster was extrapolated to 52 weeks, Operations Co-ordinators would be rostered to work approximately 161.8 days, which is approximately 1,969 hours which also equates to 38 hours per week.
[49] However, it further submitted that the number of working days may vary in different roster cycles. The roster for Operations Co-ordinators is created based on a composite rate. This means, based on each shift being 12 hours 10 minutes in duration, the roster applies “days off” to the roster cycle as a “balance point” to ensure an average of 38 hours of work per week is maintained. In addition to providing “days off”, a variance of 24 hours (2 shifts) is also provided to balance the roster over a 52 week period. Therefore, it says that it would be erroneous to determine the total number of rostered working days over a 52 week period based on one roster cycle, as there is a small variance between the number of rostered working days between cycles. Accordingly, the RFDS contends, that the roster cycle must be built on the fundamental requirement that rostered working hours be an average of 38 hours per week over a 52 week period.
[50] The RFDS maintains its position that a day of annual leave is determined based on the average ordinary working hours over a 52 week period; that is, 38 per week or 7.6 per day. The RFDS contends that, previously, Operations Co-ordinators had been permitted to perform active duties for approximately 1,616 hours per year. However, the employees should be working 1,748 hours per year (1,976 hours less 30 days of annual leave at 228 hours), which the RFDS maintains was the total annual number of hours which Operations Co-ordinators were engaged to work pursuant to the Enterprise Agreement.
[51] The RFDS further contends that one of the practical implications arising from the treatment of the annual leave is the inconsistency between the recording of the annual leave entitlement and the actual amount of leave being taken. This has the result of the Operations Co-ordinators taking more annual leave than they are entitled to and accessing their leave entitlement before it is accrued. It claims that this inconsistency must be rectified.
[52] The RFDS also contends that an important practical implication resulting from a difference between the previous treatment of annual leave and the proper application of the Enterprise Agreement is the inconsistent treatment of accrual and deduction of annual leave, and the accrual and payment of salary. Therefore, the RFDS says that salary and annual leave must be treated in the same manner; otherwise it is “misguided and unworkable” in a practical sense.
[53] The RFDS submits that the previous treatment of annual leave created an unfair rostering practice where Operations Co-ordinators would choose which days to take annual leave after the roster was published. As a result of this, there had been an unfair and inequitable share of public holidays, weekends, and other periods, such as school holidays, being rotated amongst Operations Co-ordinators. It contends that it is against first principles to record annual leave as accrued and deducted at 7.6 hours per day, but taken at a different amount.
[54] Furthermore, the RFDS contends that the CPSU’s construction of the clause is capable of being applied in a way that contravenes ss.55 and 56 of the Act.
[55] Another example of the difficulties alleged to arise from the approach contended by the CPSU is where annual leave is to be paid (or cashed out) to an Operations Co-ordinator when he or she leaves their employment. The RFDS has previously, consistent with its approach to first principles, paid out annual leave based on the numbers of hours accrued – at 7.6 hours per day. In that regard, the RFDS says that Anglo Coal is irrelevant as it concerns the cashing out of personal/carer’s leave in a manner not allowed under this Enterprise Agreement.
[56] According to the RFDS, another result of the previous treatment of annual leave is that there is a constant shortage of Operations Co-ordinators available for duties. I note that the CPSU submits that there is no shortage of labour and that the roster has been in place for many years without “too few hours being worked” or there being a shortage of staff.
[57] The RFDS contends that the Leave Policy encourages its Operations Co-ordinators to apply for annual leave up to 12 months in advance and that it would allow the RFDS to enforce its policy in the future.
[58] It is the RFDS’s position that the provisions must be consistently applied, and must not be interpreted in a way which may create or allow for tension to exist between the provisions. It maintains that clause 17 of the Enterprise Agreement is to be interpreted in the context of clause 15 and the definition of “Rostered working days” provided in clause 6.7 of the Enterprise Agreement.
5. The proper approach to the interpretation of an enterprise agreement
[59] A Full Bench of the Commission has outlined the approach that should be adopted in considering the construction and meaning of an enterprise agreement. In Golden Cockeral the Full Bench summarised the position in the following terms:
“[41] From the foregoing, the following principles may be distilled:
1. The AI Act does not apply to the construction of an enterprise agreement made under the Act. 5
2. In construing an enterprise agreement it is first necessary to determine whether an agreement has a plain meaning or contains an ambiguity.
3. Regard may be had to evidence of surrounding circumstances to assist in determining whether an ambiguity exists.
4. If the agreement has a plain meaning, evidence of the surrounding circumstances will not be admitted to contradict the plain language of the agreement.
5. If the language of the agreement is ambiguous or susceptible to more than one meaning then evidence of the surrounding circumstance will be admissible to aide the interpretation of the agreement.
6. Admissible evidence of the surrounding circumstances is evidence of the objective framework of fact and will include:
(a) 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;
(b) notorious facts of which knowledge is to be presumed;
(c) evidence of matters in common contemplation and constituting a common assumption.
7. The resolution of a disputed construction of an agreement will turn on the language of the Agreement understood having regard to its context and purpose.
8. Context might appear from:
(a) the text of the agreement viewed as a whole;
(b) the disputed provision’s place and arrangement in the agreement;
(c) the legislative context under which the agreement was made and in which it operates.
9. Where the common intention of the parties is sought to be identified, regard is not to be had to the subjective intentions or expectations of the parties. A common intention is 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.
10. 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.”
[60] I have applied this approach in determining this dispute.
[61] In Geo A Bond & Co Ltd (In Liq) v McKenzie,6 Street J said:
"...it must be remembered that awards are made for the various industries in the light of the customs and working conditions of each industry, and they frequently result ... from an agreement between the parties, couched in terms intelligible to themselves but often framed without that careful attention to form and draughtsmanship which one expects to find in an Act of Parliament. I think, therefore, in construing an award, one must always be careful to avoid a too literal adherence to the strict technical meaning of words, and must view the matter broadly, and after giving consideration and weight to every part of the award, endeavour to give it a meaning consistent with the general intention of the parties to be gathered from the whole award."
[62] In Re Aurora Energy Enterprise Partnership Agreement 2002 – 2005 Lacy SDP observed that:
“It is a widely accepted principle of statutory interpretation that the rules of construction are rules of common sense. Where the choice is between an interpretation that will result in inconvenience, injustice or absurdity and another which avoids such a result, then the latter ought to be adopted.”7
[63] The importance of context was emphasised by Burchett J in Short v Hercus Pty Ltd8 in the following terms:
“6. No one doubts you must read any expression in its context. And if, for example, an expression was first created by a particularly respected draftsman for the purpose of stating the substance of a suggested term of an award, was then adopted in a number of subsequent clauses of awards dealing with the same general subject, and finally was adopted as a clause dealing with that same general subject in the award to be construed, the circumstances of the origin and use of the clause are plainly relevant to an understanding of what is likely to have been intended by its use. It is in those circumstances that the author of the award has inserted this particular clause into it, and they may fairly be regarded as having shaped his decision to do so. The rules of construction, Mason and Wilson JJ. said in Cooper Brookes (Wollongong) Proprietary Limited v. The Commissioner of Taxation of the Commonwealth of Australia [1981] HCA 26; (1981) 147 CLR 297 at 320, are really rules of common sense. Common sense would be much offended by a refusal to look at the facts I have summarized. As Isaacs J. said in Australian Agricultural Company v. Federated Engine-Drivers and Firemen's Association of Australasia [1913] HCA 41; (1913) 17 CLR 261 at 272, citing Lord Halsbury L.C.: "The time when, and the circumstances under which, an instrument is made, supply the best and surest mode of expounding it.
… …
8. That much is fairly clear. Where there is seen to be a difficulty, the court can often go to the history of the matter. A number of illustrations will be found in Nurses (South Australia) Award (Interpretation) Case (ubi supra). But an ambiguity or obscurity may not be immediately seen on the face of a document. Both the problem and its solution may appear only when the wider context from which an expression first sprang is brought to notice. Is the court then forbidden to look past the document itself that is before it? The respondent says the instant award is clear, and we must shut our eyes to what went before. I think there are two answers to this argument. On the one hand, I do not accept that the award is clear on its face. The fact that I have given it a meaning by a process of construction (as it happens, contrary to the respondent's contention) cannot disguise the possibility of understanding the language, as the learned judge understood it, differently. (Cf. Pickard v. John Heine and Son Limited [1924] HCA 38; (1924) 35 CLR 1 at 9, per Isaacs A.C.J.) That is certainly sufficient to justify a reference to its source. Where the circumstances allow the court to conclude that a clause in an award is the product of a history, out of which it grew to be adopted in its present form, only a kind of wilful judicial blindness could lead the court to deny itself the light of that history, and to prefer to peer unaided at some obscurity in the language. "Sometimes", McHugh J. said in Saraswati v. R [1991] HCA 21; (1991) 172 CLR 1 at 21, the purpose of legislation "can be discerned only by reference to the history of the legislation and the state of the law when it was enacted". Awards must be in the same position.”
[64] These observations are consistent with the approach taken in Golden Cockeral. In the end result, my present task is to ascertain the common objective intention based upon the language and terms of the Enterprise Agreement, when read as a whole, and considered having regard to its context and purpose.
6. The context
[65] For reasons outlined above, it is important to consider the context in which the Enterprise Agreement was made and is to operate. That context is potentially relevant to the assessment of whether there is any ambiguity about a provision as well as to how any ambiguity should be resolved.
[66] Context in this present matter includes the legislative setting in which the Enterprise Agreement was made and approved, the history of the annual leave provision, and the terms of the Enterprise Agreement when read as a whole.
6.1 The legislative setting
[67] The Enterprise Agreement that is the subject of this dispute was approved by the Commission on 1 June 2015; 9 came into operation on 8 June 2015 and has a nominal expiry date of 30 June 2017. The model consultation term was taken to be a term of the Enterprise Agreement, as the agreed term did not meet the requirements in s.205(1A) of the Act.10
[68] In order to approve an enterprise agreement, the Commission must be satisfied that various requirements under the Act have been met. Amongst other requirements, the Act mandates that the agreement must: 11
● be genuinely agreed to by the employees employed at the time who will be covered by the agreement. 12 Whether an agreement has been genuinely agreed to by the employees is determined on the basis of whether the employer took the pre-approval steps in s.180 of the Act and whether a valid majority of those employees who vote in a ballot – genuinely approve the agreement as required by s.188;
● not contravene or exclude the National Employment Standards (the NES);
● pass the better off overall test when measured against the relevant modern award; and
● meet the requirements relating to particular kinds of employees.
[69] The last requirement includes that established by s.196 of the Act as follows:
“196 Shiftworkers
Application of this section
(1) This section applies if:
(a) an employee is covered by an enterprise agreement; and
(b) a modern award that is in operation and covers the employee defines or describes the employee as a shiftworker for the purposes of the National Employment Standards.
Shiftworkers and the National Employment Standards
(2) The FWC must be satisfied that the agreement defines or describes the employee as a shiftworker for the purposes of the National Employment Standards.
Note: Section 87 provides an employee with an entitlement to 5 weeks of paid annual leave if an enterprise agreement that applies to the employee defines or describes the employee as a shiftworker for the purposes of the National Employment Standards.”
[70] It is common ground that Operations Co-ordinators are shiftworkers and that the annual leave provision within the Enterprise Agreement must, and does, comply with s.196 of the Act.
[71] I now turn to the interaction between the NES and an enterprise agreement. Section 61 of the Act provides as follows:
“61 The National Employment Standards are minimum standards applying to employment of employees
(1) This Part sets minimum standards that apply to the employment of employees which cannot be displaced, even if an enterprise agreement includes terms of the kind referred to in subsection 55(5).
Note: Subsection 55(5) allows enterprise agreements to include terms that have the same (or substantially the same) effect as provisions of the National Employment Standards.
(2) The minimum standards relate to the following matters:
(a) maximum weekly hours (Division 3);
(b) requests for flexible working arrangements (Division 4);
(c) parental leave and related entitlements (Division 5);
(d) annual leave (Division 6);
(e) personal/carer's leave and compassionate leave (Division 7);
(f) community service leave (Division 8);
(g) long service leave (Division 9);
(h) public holidays (Division 10);
(i) notice of termination and redundancy pay (Division 11);
(j) Fair Work Information Statement (Division 12).
(3) Divisions 3 to 12 constitute the National Employment Standards .”
[72] Section 55 of the Act states:
“55 Interaction between the National Employment Standards and a modern award or enterprise agreement
National Employment Standards must not be excluded
(1) A modern award or enterprise agreement must not exclude the National Employment Standards or any provision of the National Employment Standards.
Terms expressly permitted by Part 2-2 or regulations may be included
(2) A modern award or enterprise agreement may include any terms that the award or agreement is expressly permitted to include:
(a) by a provision of Part 2-2 (which deals with the National Employment Standards); or
(b) by regulations made for the purposes of section 127.
Note: In determining what is permitted to be included in a modern award or enterprise agreement by a provision referred to in paragraph (a), any regulations made for the purpose of section 127 that expressly prohibit certain terms must be taken into account.
(3) The National Employment Standards have effect subject to terms included in a modern award or enterprise agreement as referred to in subsection (2).
Note: See also the note to section 63 (which deals with the effect of averaging arrangements).
Ancillary and supplementary terms may be included
(4) A modern award or enterprise agreement may also include the following kinds of terms:
(a) terms that are ancillary or incidental to the operation of an entitlement of an employee under the National Employment Standards;
(b) terms that supplement the National Employment Standards;
but only to the extent that the effect of those terms is not detrimental to an employee in any respect, when compared to the National Employment Standards.
Note 1: Ancillary or incidental terms permitted by paragraph (a) include (for example) terms:
(a) under which, instead of taking paid annual leave at the rate of pay required by section 90, an employee may take twice as much leave at half that rate of pay; or
(b) that specify when payment under section 90 for paid annual leave must be made.
Note 2: Supplementary terms permitted by paragraph (b) include (for example) terms:
(a) that increase the amount of paid annual leave to which an employee is entitled beyond the number of weeks that applies under section 87; or
(b) that provide for an employee to be paid for taking a period of paid annual leave or paid/personal carer's leave at a rate of pay that is higher than the employee's base rate of pay (which is the rate required by sections 90 and 99).
Note 3: Terms that would not be permitted by paragraph (a) or (b) include (for example) terms requiring an employee to give more notice of the taking of unpaid parental leave than is required by section 74.
Enterprise agreements may include terms that have the same effect as provisions of the National Employment Standards
(5) An enterprise agreement may include terms that have the same (or substantially the same) effect as provisions of the National Employment Standards, whether or not ancillary or supplementary terms are included as referred to in subsection (4).
Effect of terms that give an employee the same entitlement as under the National Employment Standards
(6) To avoid doubt, if a modern award includes terms permitted by subsection (4), or an enterprise agreement includes terms permitted by subsection (4) or (5), then, to the extent that the terms give an employee an entitlement (the award or agreement entitlement ) that is the same as an entitlement (the NES entitlement ) of the employee under the National Employment Standards:
(a) those terms operate in parallel with the employee's NES entitlement, but not so as to give the employee a double benefit; and
(b) the provisions of the National Employment Standards relating to the NES entitlement apply, as a minimum standard, to the award or agreement entitlement.
Note: For example, if the award or agreement entitlement is to 6 weeks of paid annual leave per year, the provisions of the National Employment Standards relating to the accrual and taking of paid annual leave will apply, as a minimum standard, to 4 weeks of that leave.
Terms permitted by subsection (4) or (5) do not contravene subsection (1)
(7) To the extent that a term of a modern award or enterprise agreement is permitted by subsection (4) or (5), the term does not contravene subsection (1).
Note: A term of a modern award has no effect to the extent that it contravenes this section (see section 56). An enterprise agreement that includes a term that contravenes this section must not be approved (see section 186) and a term of an enterprise agreement has no effect to the extent that it contravenes this section (see section 56).”
[73] Accordingly, ss. 55 and 61 of the Act establish that an enterprise agreement cannot exclude or displace the NES. Any terms of an agreement that purports to do so, does not have any effect, at least to that degree. The enterprise agreement may, however, duplicate and supplement the NES and deal with NES related matters that are permitted by the Act. 13
[74] The NES includes a provision for annual leave entitlements including, relevantly, in the following form:
“87 Entitlement to annual leave
Amount of leave
(1) For each year of service with his or her employer, an employee is entitled to:
(a) 4 weeks of paid annual leave; or
(b) 5 weeks of paid annual leave, if:
(i) a modern award applies to the employee and defines or describes the employee as a shiftworker for the purposes of the National Employment Standards; or
(ii) an enterprise agreement applies to the employee and defines or describes the employee as a shiftworker for the purposes of the National Employment Standards; or
(iii) the employee qualifies for the shiftworker annual leave entitlement under subsection (3) (this relates to award/agreement free employees).
Note: Section 196 affects whether the FWC may approve an enterprise agreement covering an employee, if the employee is covered by a modern award that is in operation and defines or describes the employee as a shiftworker for the purposes of the National Employment Standards.”
Accrual of leave
(2) An employee's entitlement to paid annual leave accrues progressively during a year of service according to the employee's ordinary hours of work, and accumulates from year to year.
Note: If an employee's employment ends during what would otherwise have been a year of service, the employee accrues paid annual leave up to when the employment ends.
… ….
90 Payment for annual leave
(1) If, in accordance with this Division, an employee takes a period of paid annual leave, the employer must pay the employee at the employee’s base rate of pay for the employee’s ordinary hours of work in the period.
(2) If, when the employment of an employee ends, the employee has a period of untaken paid annual leave, the employer must pay the employee the amount that would have been payable to the employee had the employee taken that period of leave.”
[75] The NES expresses annual leave entitlements in weeks, rather than hours or days. Nothing prevents an enterprise agreement specifying the entitlement in days, hours or indeed rostered shifts, provided that the end result is not inferior to the NES provision.
[76] The operation of the NES with respect to annual leave was considered by a Full Bench in RACV. Without detracting from the comprehensive discussion about the history and context for the NES provisions, the Full Bench commenced with a consideration of the terms “week” and “day” and observed that:
“[35] It is apparent from the examples above, and from the other provisions of the FW Act in which the words appear, that “week” and “day” are often used in contexts where they have no connection to any entitlement to payment. The inference one draws from such provisions is that “week” and “day” where used in the FW Act bear their ordinary meaning as descriptions of a calendar period of time. It is a principle of statutory interpretation that words and expressions in an Act are presumed to have the same meaning throughout the Act. Therefore, unless there is a specific implication arising from the narrower context of the NES provisions concerning annual leave or personal/carer’s leave which dictates otherwise, “week” and “day” should be given their ordinary meaning where used within those provisions.” (citations omitted)
[77] The Full Bench also dealt with the relationship between the accrual and deduction for leave in the following terms:
“[37] As earlier stated, the Commissioner concluded in the Decision that the NES annual leave and personal/carer’s leave provisions did not deal with the rate at which annual leave and personal/carer’s leave is deducted when taken, and also that the NES did not require that the rate at which the leave is accumulated and the rate at which it is deducted when used must be the same. While these propositions are, strictly speaking, correct in that the FW Act does not contain express provisions of the nature described, it does not follow that there is any lack of clarity in the statutory scheme. No such provisions are necessary because, when “week” and “day” are assigned their ordinary meanings, the position is entirely clear. The accrued entitlement is simply reduced by the amount of leave taken, so that if a week of leave is taken, the accrual of leave is reduced by a week, and if a day is taken, the accrual is reduced by a day. If, as RACV contends, the reduction in an employee’s accrued NES entitlement to annual leave or personal/carer’s leave when the employee takes a day off work will vary depending upon the number of ordinary hours that would have been worked that day, then one would expect the FW Act to contain provisions specifying this. The absence of any such provision tells against the construction of the NES provision propounded by RACV.”
[78] In dealing with a passage contained in the Explanatory Memorandum 14 that referenced hours rather than weeks, the Full Bench also stated:
“[44] We do not consider that the above passage supports the construction of the relevant NES provisions contended for by RACV. It is concerned with the accrual of and payment for annual leave. We have earlier discussed the accrual method in s.87(2), and there is nothing in the passage which is contrary to our analysis. In relation to payment for leave, there was no issue in the proceedings that s.90 requires an employee to be paid at the base rate for the ordinary working hours falling in the period of annual leave that is taken, and nothing in the above passage suggests otherwise. The reference in the passage, in the first example, to 2 weeks’ leave being equivalent to 76 hours and, in the second example, to 2 weeks’ leave being equivalent to 24 hours arises from the fact that in each example the same number of hours is worked each week. In cannot be extrapolated from this that if the number of hours worked each week varies according to a shift roster, a “week” of leave is to be read as meaning, not the actual working days falling within a given seven-day period during which leave is taken, but to a notional number of working hours derived from the employee’s average hours. The provisions in the FW Act do not say that this is the case, and neither does the Explanatory Memorandum.”
[79] I also note that in applying the provisions of the enterprise agreement in question in RACV, which expressed the annual leave entitlement in ordinary hours, the Full Bench concluded that:
“[84] … … The inescapable inference must be that where accrued leave entitlements are utilised, the accrued amount of leave is reduced by the amount of leave taken. Where, as in clause 15.1(c) and clause 16.1, the quantum of the entitlement is expressed in terms of ordinary hours of work, it is self-evident that an employee’s accrued hours of leave will be reduced by the amount of ordinary hours of work during which the employee is absent on leave. Thus, if an employee is absent on a day on which he or she was rostered to work (say) 8 ordinary hours, the amount of the employee’s leave entitlement will be reduced by the amount of leave taken - that is, 8 hours. This is not to be confused with the issue of payment for the leave, which because of the averaging system of payment under the Agreement means that an employee will always be paid 7.6 hours for each working day’s absence on annual leave or personal/carer’s leave.”
[80] In Anglo Coal, the Court was dealing with paid personal/carer’s leave but observed:
“[10] The period of “paid personal/carer’s leave” referred to in s 99, for which an employee must be paid at the base rate of pay for ordinary hours, must necessarily be one or more of the “days” (or part of a day) of leave referred to in s 96. The number of hours normally worked by, for example, an 8-hour day worker and a 12-hour shift worker on a normal or rostered day of work are self-evidently different, by a margin of 50%. Nevertheless, the entitlement to paid leave is not referable to an hourly equivalent; it is expressed in days, and it necessarily follows, I think, that the possibility exists that the statutory entitlement to 10 days leave (and pay) may result in a greater hourly entitlement (and overall pay) in some cases than in others. That, it appears to me, is the effect of the statutory arrangements, whatever position might arise under the specific provisions of particular enterprise agreements.”
[81] Amongst other implications of the above is that for the purposes of the NES the terms “day” and “week” should be given their normal meaning. Further, the normal course for annual leave entitlements is that when the accrued annual leave entitlement is expressed in terms of the ordinary hours of work and that leave is taken, the entitlement is reduced by the ordinary hours of work during the period of absence when the employee is on leave. In addition, where an entitlement is expressed by reference to a day or other period, the actual entitlement (at least when considered from the perspective of hours) may vary depending upon the hours normally worked on a day or other defined period.
[82] Further, and subject to the operation of the NES entitlements as a minimum, the actual terms of the industrial instrument concerned will determine how the annual leave is to be accrued and taken.
6.2 The history of the annual leave practice and the agreement provisions at the RFDS
[83] The first relevant enterprise agreement, the Royal Flying Doctor Service (Central Section) Inc. Communications Staff Certified Agreement 2000, came into effect on 22 January 2001. It provided for 25 rostered working days of annual leave per year and the ordinary hours were defined as being 38 hours per week. Furthermore, a shift was defined as being between 5 and 9 hours, with Schedule B to the instrument showing the roster pattern of 3 shifts on and 3 days off.
[84] The next enterprise agreement was the Royal Flying Doctor Service of Australia Central Operations Incorporated, Communications Staff Certified Agreement 2004 (the 2004 Agreement), which came into effect on 5 July 2004. The 2004 Agreement increased the annual leave entitlement to 30 rostered working days per year. Ordinary hours remained at 38 hours per week and a shift was between 5 and 9 hours, with Schedule B showing the roster pattern of 3 shifts on and 3 days off.
[85] The subsequent enterprise agreement, The Royal Flying Doctor Service of Australia Central Operations Incorporated, Tasking Co-ordinators (Port Augusta) Collective Agreement 2007-2010 (the 2007-2010 Agreement) operated from the date of lodgement with the Office of the Employment Advocate. It maintained the 30 rostered working days of annual leave, however, the roster cycle was amended to 12 hour shifts, with Schedule B showing a roster pattern of 3 shifts on and 3 to 10 days off depending upon the relevant roster line.
[86] The penultimate enterprise agreement, the Royal Flying Doctor Service of Australia Central Operations Incorporated, Tasking Co-ordinators Agreement 2010, came into effect on 16 September 2011 and carried over the annual leave, hours of work and rostering cycle from the 2007-2010 Agreement.
[87] On that basis, each of the previous provisions (and the current Enterprise Agreement) defined annual leave by reference to the term “rostered working days”. I also note that this term was defined in each of the agreements in the same manner as the current enterprise agreement.
[88] It is apparent from the evidence that the RFDS has for some time adopted an administrative practice to record annual leave as being accrued and deducted at 7.6 hours per day. However, it is also apparent that this did not impact upon how the leave was rostered or paid, and that the rostered hours within the roster itself did not rely upon that administrative practice. That is, the hours rostered for the balance of the year did not in practice reflect that (only) 228 hours per annum was assigned to annual leave for the Operations Co-ordinators.
[89] The history of bargaining negotiations for the most recent Enterprise Agreement can be summarised as follows:
- Bargaining negotiations commenced in October 2013;
- A draft agreement proposed by the RFDS was disseminated to employees for a vote on 8 December 2014. Amongst other provisions, this draft contained a version of clause 17.1 that expressly referred to the annual leave being accrued and taken at 7.6 hours per day;
- The December 2014 draft agreement was rejected by a majority of the employees;
- On 23 December 2014, the RFDS made an application to the Commission to deal with a bargaining dispute by way of conciliation pursuant to s.240 of the Act;
- The parties attended conciliation conferences before me on 29 January, 7 April and 16 April 2015. During the conciliation conferences, the CPSU expressed concerns over the addition of the words “at 7.6 hours per day” and was of the opinion that the drafting may result in a reduction of annual leave entitlement. The RFDS clarified that the annual leave will be accrued and deducted at 7.6 hours per day, with employees not being required to report for duties for the difference of 4.4 hours;
- During the conciliation, and with the assistance of the Commission, the parties reached an understanding about some principles that could be applied to the development of future rosters and in that light the RFDS agreed to remove the reference to annual leave being 7.6 hours per day from the draft agreement. It was also understood that once the draft agreement was agreed and approved by the Commission, the RFDS would deal with changes in the roster in accordance with the consultation provision contained within the Enterprise Agreement;
- Following the tabling of proposed principles and various exchanges between the parties, on 17 April 2015, the RFDS confirmed in writing the proposed principles and its position on the matter;
- On 24 April 2015, the CPSU confirmed that it noted and agreed with the principles contained in the RFDS correspondence of 17 April 2015 and indicated that its members had voted in support of the proposed enterprise agreement; and
- The Enterprise Agreement was ultimately approved by the Commission on 1 June 2015. 15
[90] The RFDS correspondence to the CPSU of 17 April 2015 was provided on its behalf by Mr Dasan and included the following:
“RFDS Operations Co-ordinators Agreement
We refer to our discussions before Commissioner Hampton during conciliation conference on 16 April 2015.
I reiterate the RFDS’ principles in this correspondence as agreed at the conciliation on 16 April 2015, namely:
1. that all full-time employees will work an average of 38 hours per week ordinary time. This equates to 1976 hours per annum;
2. that employees will be entitled to take 30 days of annual leave per annum;
3. that there will be equitable rules within the roster for the taking of leave; and
4. that we will, pursuant to the Enterprise Bargaining Agreement, consult employees with regard to any changes to the roster.
As previously discussed, each full-time Operations Co-ordinator is to provide service for an average of 38 hours per week, less the allocated annual leave (if taken). As such, all leave entitlements accrue at 7.6 hours per day. This remains to be the RFDS’ position and is consistent with the legal principles pursuant to the Fair Work Act 2009.
I reiterate that the Operations Co-ordinators are entitled to 30 days of annual leave per year (or 228 hours). The RFDS expects that they will provide work for 1,748 hours per year. The RFDS appreciates that there may be a small variance between staff (+/- 24 hours), but it is the RFDS’ expectation that staff work a full complement of hours.
As agreed during the conciliation on 16 April 2015, whilst maintaining its position and the principles as set out above, the RFDS is prepared to redraft Clause 17.1 as follows:
‘All Operations Co-ordinators are entitled to 30 rostered working days of annual leave in each 52 week period (pro rata for part-time Operations Co-ordinators). Leave shall accrue and be taken in accordance with the RFDS Leave Policy.’
Please find enclosed the updated draft Agreement reflecting the above amendment.
It is my understanding that you require 5 days to consult your members on this matter and it was agreed during the conciliation that you will respond to this letter by COB 24 April 2015.
I look forward to your response and should you require further clarification or assistance, please do not hesitate to contact me at your convenience.
…” 16
[91] The CPSU response of 24 April 2015 was in the following terms:
“Royal Flying Doctor Service, Central Operations Tasking Co-ordinators Agreement 2010
I refer to your letter dated 17th April 2015 reiterating the RFDS’ principles as agreed by the Parties at conciliation on 16th April 2015, provision of the agreed draft annual leave clause and the replacement enterprise agreement proposed by the Royal Flying Doctor Service (RFDS).
Consistent with our commitment to undertake consultation with CPSU Members, a ballot to endorse the proposed enterprise agreement has been conducted. CPSU Members have voted to support the terms of the proposed enterprise agreement and request that the RFDS now take the steps necessary for the enterprise agreement to be considered for approval by the Fair Work Commission.
Furthermore the CPSU notes and agrees the principles contained in the RFDS’ correspondence of 17th April 2015:
1. that all full-time employees will work an average of 38 hours per week ordinary time. This equates to 1976 hours per annum;
2. that employees will be entitled to take 30 days of annual leave per annum;
3. that there will be equitable rules within the roster for the taking of leave; and
4. that we will, pursuant to the Enterprise Bargaining Agreement, consult employees with regard to any changes to the roster.
Should you have any questions in relation to this letter please contact me on the numbers contained within.
…” 17
[92] RFDS contends that its correspondence of 17 April 2015 clearly and unequivocally communicated the position that the Operations Co-ordinators were entitled to 30 days, or 228 hours, of annual leave per year, and that employees would work for 1,748 hours per year. This calculation is reached by taking into account the averaging hours requirement in clause 15. The RFDS calculation is as follows: 38 hours x 52 weeks per year = 1,976, and 1,976 - 228 hours of annual leave = 1,748 hours worked.
[93] It further contends that the position was not challenged and was accepted by the CPSU in the written correspondence in reply dated 24 April 2015.
[94] The CPSU contends that the principles were agreed, however, the intended use of those principles by the RFDS was not agreed and not reflected within the Enterprise Agreement.
[95] I find that in the end result, what occurred during the negotiations of the Enterprise Agreement was that the parties agreed upon some general principles that gave some comfort to the RFDS in the context of agreeing to remove its proposed reference to 7.6 hours per day in clause 17.1. Equally, the CPSU and its members accepted the principles in the light of the retention of the then existing clause.
[96] I note that the principles as stated can be applied to either approach of the parties to the issues being determined in this decision. That is, depending upon the value given to the annual leave hours, which is not expressed in the principles, either approach will lead to the employees working approximately 1,976 hours per annum including the periods of annual leave. The reference to the RFDS’s intention to approach the future roster on the basis of 228 hours of annual leave is contained in the correspondence but not in the agreed principles. It is also the case that the RFDS did not abandon its preferred approach to the issue when it relented on its proposal to include reference to 7.6 hours in the draft agreement.
[97] It is clear to me that, in effect, the parties found a basis to accommodate the differing views about the annual leave provisions without actually dealing with the substance of the dispute that is now before the Commission. Rather, it was intended that the dispute be dealt with under the new Enterprise Agreement. It is also the case that the CPSU was clearly put on notice how the RFDS considered that the provisions should be applied and its intention to pursue a roster based upon that approach.
[98] On that basis, a common objective intention as to the precise operation of clause 17.1 and related provisions does not arise from the negotiations leading to the present Enterprise Agreement. The principles were agreed and are relevant as part of the context; however, these do not directly deal with the issue, did not form part of the Enterprise Agreement, and in any event cannot be relied upon to override the terms of the instrument.
6.3 Other provisions of the Enterprise Agreement
[99] I have set out most of the relevant terms of the Enterprise Agreement earlier in this decision. The following provisions also have a bearing upon the present dispute.
[100] Clause 8 of the Enterprise Agreement provides as follows:
“8. NO FURTHER CLAIMS
The parties bound by this Agreement shall not make extra claims that alter the terms and conditions of employment for the period during which this Agreement operates, whether or not those terms and conditions relate to a matter that is expressly covered by this Agreement.”
[101] Whilst relevant, this provision is not decisive in this matter. It would, under clause 8, not be proper for the RFDS to pursue changes or claims that were inconsistent with the terms of the Enterprise Agreement, or for the CPSU to resist agreed arrangements. However, the dispute concerns the intended meaning and application of clause 17 when read in context. I have already found that no common objective intention was confirmed during the negotiation process.
[102] Clause 17 makes reference to part-time employees and there is a further provision directly pertaining to these employees as follows:
“13. PART-TIME OPERATIONS CO-ORDINATORS
13.1 The ordinary hours of a part-time Operations Co-ordinator shall be negotiated between the RFDS and the Operations Co-ordinator, and shall not be equal to or exceed those ordinary hours of a full-time Operations Co-ordinator.
13.2 Part-time Operations Co-ordinators shall be entitled to salary and paid leave at a rate proportional to a full-time Operations Co-ordinator, according to hours worked, and based on the appropriate salary in Schedule A of this Agreement.
13.3 Full-time Operations Co-ordinators, who request part-time work and are given such work, may revert to full-time employment on a specified future date by agreement with the RFDS.
13.4 No existing full-time Operations Co-ordinator shall be transferred by the RFDS to part-time.”
[103] The implication of clause 13.2 is that part-time employees are entitled to paid annual leave at a rate proportional to full-time employees based upon their hours of work. When read in conjunction with clause 17, this means that (for instance) a part-time employee working half time would be entitled to 30 rostered days of annual leave at half pay. This is the conventional approach to pro-rata entitlements for part-time employees when those entitlements are expressed in days (or weeks) and is necessary to ensure that the part-time shift employees receive their NES based annual leave entitlement as outlined earlier in this decision. The intended operation of clause 17 should also recognise the impact upon part-time employees.
[104] There are two provisions, amongst others, that provide for paid leave in addition to the annual leave clause that is the focus of this matter. They include the following:
“19. PERSONAL LEAVE
19.1 Paid personal leave of 10 working days per year is available to an Operations Co-ordinator who is absent from work due to:
19.1.1 Personal illness or injury (sick leave); or
19.1.2 Having to provide care and support to an immediate family or household member who is ill or injured (carer's leave); and is accrued and taken in accordance with the RFDS Leave Policy.
19.2 Personal leave is cumulative, but unused leave is not payable upon termination of employment
20. COMPASSIONATE LEAVE
An Operations Co-ordinator is entitled to (sic) paid compassionate leave for up to three days per occasion in accordance with the RFDS Leave Policy.”
[105] Of note is that these entitlements are expressed in “working days” and as “days”, rather than the defined term of “rostered working days” utilised in the annual leave provision.
[106] Schedule B of the Enterprise Agreement sets out the roster model in operation at the time of the instrument coming into force. It provides 7 day, 24 hour coverage using 12 hour rotating shifts. Within that framework, it sets out various roster “lines” with 4 shifts on duty and 4 to 6 shifts (days) off per work cycle. This produces a range of roster hours between 24 and 48 per week, with employees undertaking various roster lines during any given year.
[107] Each rostered shift is for a period of 12 hours (and 10 minutes for changeover purposes).
[108] Subject to consultation requirements, and provided that any new roster is consistent with all of the terms of the Enterprise Agreement, the RFDS may change the shift roster and is not confined to that set out in Schedule B.
7. Consideration and conclusions
[109] Having regard to the proper approach to be adopted to the present matter, and applying the terms of the Enterprise Agreement when read as a whole and in context, I consider that clause 17 and related provisions are objectively intended to apply in the following way.
[110] Clause 17 of the Enterprise Agreement provides Operations Co-ordinators with an annual leave entitlement of 30 rostered working days per annum. This entitlement is expressed in rostered working days – not hours and not weeks. Furthermore, unlike surrounding clauses that deal with other leave entitlements which express the entitlement in terms of “working days” or “days”, clause 17 has adopted a defined term; namely, rostered working days. That term, as defined in clause 6.7, means a day rostered on duty.
[111] Accordingly, subject to meeting the minimum standards set by the NES, this must mean that Operations Co-ordinators have an annual leave entitlement of 30 rostered working days; being 30 days of leave to be taken on days that the Operations Co-ordinator would have otherwise been rostered to work. Under the terms of the Enterprise Agreement, the employees concerned must receive their annualised salary rate for each day that annual leave is taken.
[112] The rostered working day presently involves just over 12 hours and whatever the rostered working day becomes under any new roster in the future will be the length of the rostered working day for the purposes of clause 17.
[113] Despite the CPSU’s contention to the contrary, it is necessary to consider the ordinary hours of work provisions when seeking to determine the proper application of clause 17. That is, although the annual leave provision is defined by reference to rostered working days, it is necessary to consider the impact of any approach to clause 17 upon the hours of work that may be included for the balance of the roster period to enable the average of not more than 38 ordinary hours per week to be provided.
[114] However, contrary to the contention of the RFDS, this does not mean that the average ordinary hours of work can be applied in a manner that is inconsistent with the terms of clause 17. That is, having chosen to express the annual leave entitlement in rostered working days, it is not appropriate to simply convert the rostered working days into an average ordinary hours equivalent. I note that this would be reasonable where the annual leave entitlement is expressed in terms of ordinary hours, and potentially, where the entitlement is expressed in terms of weeks. In this case, the entitlement is to 30 rostered working days and whatever ordinary hours are involved in those rostered working days.
[115] Accordingly, to the extent that an hours equivalent is necessary for the purposes of constructing the balance of the roster, this means that the entitlement is presently the equivalent of 365 hours. The hours of work for the remainder of the roster would enable the total annual hours to average 1,976 hours (including annual leave), subject to the variations arising between roster lines.
[116] If viewed in that manner, the equivalent hours will vary if an alternative roster was constructed with a different rostered day. However, the actual entitlement to 30 rostered days would not vary. For reasons outlined earlier in this decision, this approach would apply to part-time employees according to their pro-rata hours.
[117] This approach represents the ordinary and natural application of the agreed provisions when read in context.
[118] Any annual leave that is paid out on termination would need to be applied having regard to the above approach.
[119] To the extent that there are issues associated with the actual taking of the leave and the equitable rules that should be applied, subject to the above parameters, these are matters that could be further dealt with under the consultation and hours of work provisions of the Enterprise Agreement.
8. The Outcome
[120] For reasons outlined above, I consider that the proper application of clause 17 and related provisions is that as set out above.
[121] I would observe that this outcome arises from the unique wording of this Enterprise Agreement when applied in context. To the extent that this produces, from the perspective of the RFDS, an outcome that is not completely consistent with more conventional rostering practice and entitlements, this is a matter to be dealt with directly through bargaining.
[122] Further, an application of this nature is not a merit arbitration of the appropriate standards in the traditional sense. Given the present jurisdiction and role of the Commission, it is also not permissible for the Commission to effectively rewrite an enterprise agreement, 18 or to determine an approach that is inconsistent with the terms of the enterprise agreement itself.19
COMMISSIONER
Appearances:
K Barlow of the CPSU, the Community and Public Sector Union for the applicant.
S Dasan and V Liu of Norman Waterhouse, with permission, on behalf of Royal Flying Doctor Service of Australia, Central Operations.
Hearing details:
2016
Adelaide
14 June.
Final written submissions:
2016
8 and 13 July.
1 The employees are currently rostered for 12 hours and 10 minutes for each day of work.
2 [2014] FWCFB 7447.
3 [2015] FWCFB 2881.
4 [2016] FCA 689.
5 Reference to the AI Act is to the Acts Interpretation Act 1901.
6 [1929] AR (NSW) 498 at 503; See also City of Wanneroo v Holmes (1989) 30 IR 362 (at 378-379) and Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241 at [2].
7 Re Aurora Energy Enterprise Partnership Agreement 2002 – 2005, [2008] AIRC 1074, at para 17; See also National Union of Workers v Plexicor Australia [2008] AIRC 1134.
8 (1993) 40 FCR 511.
9 Royal Flying Doctor Service of Australia Central Operations T/A Royal Flying Doctor Service, Central Operations [2015] FWCA 3706.
10 Royal Flying Doctor Service of Australia Central Operations T/A Royal Flying Doctor Service, Central Operations [2015] FWCA 3706 [2].
11 ss.186, 187, subdivision E, 202, 205 of the Act.
12 s.186(2)(a) of the Act.
13 See Canavan Building Pty Ltd [2014] FWCFB 2823.
14 Explanatory Memorandum to the Fair Work Bill 2008.
15 [2015] FWCA 3706.
16 Attachment TV-13 to the Statement of Mr Vaughan – Exhibit RFDS1.
17 Attachment TV-14 to the Statement of Mr Vaughan – Exhibit RFDS1.
18 Golden Cockeral at [41] – point 10.
19 s.739(5) of the Act.
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