CPSU, the Community and Public Sector Union v Technical and Further Education Commission T/A TAFE NSW - [2022] FWC 2908

[2022] FWC 2908

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.739—Dispute resolution

CPSU, the Community and Public Sector Union
v

Technical and Further Education Commission T/A TAFE NSW

(C2022/2404)

COMMISSIONER MCKENNA

SYDNEY, 16 NOVEMBER 2022

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

An application has been made, pursuant to s.739 of the Fair Work Act 2009 (“FW Act”), by CPSU, the Community and Public Sector Union (“CPSU”) to deal with a dispute between it and the Technical and Further Education Commission T/A TAFE NSW (“TAFE”). The relevant enterprise agreement is the TAFE Commission of NSW Administrative, Support and Related Employees Enterprise Agreement 2019 (“Enterprise Agreement”). The dispute relates to the operation of the casual conversion provisions of the National Employment Standards set out in Chapter 2, Part 2-2, Division 4A of the FW Act as those provisions concern the CPSU’s claim for the casual conversion of certain employees covered by the Enterprise Agreement and the failure or refusal by TAFE make offers concerning casual conversion. It is common ground that, by clause 8 of the Enterprise Agreement, the Commission can determine the dispute under the dispute settlement procedures.

The following summary of the parties’ positions is drawn from their written outlines of submissions. The oral submissions in the proceedings drew from those outlines and expanded upon them, including by reference to a range of authorities.

The case advanced by the CPSU

By way of background, TAFE confirmed to the CPSU in late-2021 that it would not make offers to any eligible casual employees to be converted to permanent employment due to the operation of s.18(1) of the Technical and Further Education Act 1990 (NSW) (“TAFE Act”). The CPSU advised that it disputed TAFE’s position and made this application to the Commission to deal with the dispute. The application was previously allocated to a different Commission member, before its more recent reallocation to me.

An overview of the submissions for the CPSU is as follows. In its initial round of submissions, the CPSU summarises its understanding of the position of TAFE as involving the following contention/s as to why it is not required to make offers of casual conversion to any eligible employees as it has reasonable grounds not to make any offers. To do so:

(a) would not comply with a recruitment or selection process required by s.18(1) of the TAFE Act for the purposes of s.66C(2)(d) of the FW Act; and
(b) in addition, or in the alternative, would be contrary to a merit-based comparative assessment process that TAFE adopts in accordance with the core values under s.7 of the Government Sector Employment Act 2013 (NSW) (“GSE Act”), s.18(1) of the TAFE Act and Part 3 of the Government Sector Employment (General) Rules 2014 (NSW) (“GSE Rules”), even if TAFE is not strictly required to follow such a process under those provisions.

The CPSU submits that neither of the preceding grounds provides a basis for TAFE to refuse to make offers of casual conversion to all eligible casual employees under s.66B(1) of the FW Act. The submissions reference the evidence of certain casual employees in such respects, in contending that each of the casual employees satisfies the requirements in s.66B(1) of the FW Act and TAFE is required to make an offer to convert them to full-time or part-time employment. It is submitted by the CPSU that no reasonable grounds exist not to make the offer for the purposes of s.66C(1).

After an outline of the background to the insertion of the casual conversion provisions into the FW Act and extracting the relevant provisions, the CPSU submits:

“11. These provisions are designed for a beneficial purpose and to confer novel rights which did not exist at common law. Beneficial statutory provisions of that nature should be interpretation [sic] liberally rather than narrowly and should be construed to give the fullest relief which the fair meaning of its language allows. A corollary of this rule of construction is that exemption provisions in remedial legislation should be construed such that any doubt about their scope should be resolved in favour of the enhancement of the right conferred and against its diminution by the operation of the exclusion. In short, any exclusion from the beneficial operation of s 66B should be construed narrowly rather than expansively.”

The CPSU also sets out certain background matters concerning TAFE itself and provisions of the TAFE Act that are relevant, directly or indirectly, to employment, including ss.15, 16, 18 and 19. The submissions also note some provisions of the GSE Act. That statute makes provision with respect to employment in the NSW Government sector and more specific provision with respect to the public service, including a principle to “recruit and promote employees on merit”. Section 48(a) provides that the Government sector employment rules may deal with any matter relating to the employment of public service non-executive employees, including “the recruitment of any such employees (including the recruitment process and the application of the principle of employment on merit)”. Part 3 of the GSE Rules provides for merit-based employment, including requiring comparative assessment of candidates following external advertising in certain circumstances.

As the CPSU understands it, TAFE’s primary contention is that it is not required to make offers of casual conversion to any casual employee because it has reasonable grounds not to do so, for the purposes of s.66C(2)(d) of the FW Act, relying on s.18(1) of the TAFE Act. As to that, the CPSU submits it is necessary to start with the proper interpretation of s.66C(2)(d). The question posed by s.66C(2)(d) is whether making an offer to an existing casual employee “to convert” to full-time or part-time employment would “not comply” with a recruitment or selection process required by or under, relevantly, a law of a State. That is, making the offer “to convert” must result in a contravention of, or be inconsistent with, a law of a State to attract the operation of s.66C(2)(d) and to give rise to reasonable grounds for deciding not to make an offer for the purposes of that provision. Here, the law relied upon by TAFE is s.18(1) of the TAFE Act, in that the section requires the appointment of members of staff and any promotions to be made on the basis of the merit of the applicants for appointment or promotion.

The CPSU submits that TAFE’s reliance on s.18(1) of the TAFE Act is “mistaken”; making an offer to convert an existing casual employee who has been working a regular pattern of hours to convert to full-time or part-time employment would not result in a contravention of s.18(1) of the TAFE Act.

The CPSU’s first tranche of submissions discuss the interaction of statutory provisions in furtherance of its proposition that TAFE is mistaken. Section 66B of the FW Act contemplates that an offer to convert to full-time or part-time employment will be made to a casual employee based upon the existing position and pattern of hours of the employee. To “appoint” is generally understood to involve designating a person to a position, who is not already within the establishment, whereas to promote is to advance from a lower grade to a higher grade. What is contemplated by s.66B is not a new appointment of a person from outside TAFE, but the conversion of an existing employee who has already been recruited to the job to permanent employment. In that context, the CPSU submits, s.18(1) of the TAFE Act is not engaged. Instead, s.18(1) of the TAFE Act operates on initial appointment of an employee or upon promotion. It is the “appointment” or “promotion” that must be made on the basis of the merit of respective applicants. If a person is already employed as a casual employee and performing a particular job, an offer to convert the existing employment to full-time or part-time employment to undertake the same job cannot be regarded as a new appointment subject to a further “appointment” or merit selection process. Nor would it involve “promotion”, which contemplates advancement to a higher grade or position.
With reference made to certain authorities, the CPSU submits that that approach is consistent with the way other public sector employment legislation has been interpreted historically; other provisions in public sector employment legislation referring to the “appointment” of a person to a vacant position have been found refer to the initial appointment of a public sector employee and not to the transfer of an existing officer or, indeed, the reinstatement of a dismissed officer. No different conclusion would be reached with respect to the concept of “appointment” in ss.18 and 19 of the TAFE Act.
As to TAFE’s reliance on Re NSW TAFE Commission (Teachers and Other Educational Staff) Salaries and Conditions Award 1996 (1999) 123 IR 360; [1999] NSWIRComm 234, that case is not on point; it turned on the question the now-repealed s.19(1) of the TAFE Act (which provided that any matter, question or dispute “relating to” the appointment or failure to appoint a person to a vacant position was not an “industrial matter” under the Industrial Relations Act 1996 (NSW)). The question posed by s.66C(2)(d) of the FW Act is different in that:
·   the question is whether making an offer to convert a casual employee to full-time or part-time employment “would not comply with a recruitment or selection process required by or under a law of ... a State”;
·   the question is not whether the matter “relates to” the subject of appointment or the failure to appoint. Section 18(1) of the TAFE Act relevantly provides no more than that the appointments of members of staff are to be made on the basis of the merit of applicants for appointment; and
·   the question is whether an offer to convert an existing employee based on the pattern of work performed involves a failure to comply with s.18(1) of the TAFE Act, and, the CPSU submits, it does not.

As a second, and/or an alternative tranche of submissions, the CPSU submits that an offer to convert an existing casual employee performing work on a regular and systematic basis to full-time or part-time employment could involve non-compliance with s.18(1) of the TAFE Act only if it was inconsistent with merit selection. The type of offer contemplated by s.66B(2) of the FW Act is to convert existing employment to full-time or part-time employment. If a casual employee was initially engaged following a merit selection process, a later offer to convert that job to full-time or part-time employment could not give rise to a failure to comply with s.18(1) of the TAFE Act. As such, the refusal of TAFE to make any offer of casual conversion regardless of the circumstances could not be justified by s.66C(2)(d) of the FW Act.

As exampled in the case of each of the CPSU’s employee witnesses, the employee applied for casual employment and was subject to merit selection in the form of an interview and competitive selection. Each such employee has already been appointed on the basis of merit. To make an offer to convert such an employee in his or her current job to full-time or part-time employment in accordance with s.66B of the FW Act would not result in a contravention of the requirement in s.18(1) of the TAFE Act that appointments be on the basis of merit. Section 18(1) could not be construed so as to require some new merit assessment be conducted on each occasion where there is some change to the terms or duration of the employment of an individual.

For these reasons, TAFE does not have reasonable grounds to refuse to make offers of conversion to any casual employees to convert to full-time or part-time employment for the purposes of s.66C(2)(d) of the FW Act by reason of s.18(1) of the TAFE Act.

A third tranche of the CPSU’s submissions addresses its understanding that TAFE advances an alternative contention, namely, that it has reasonable grounds pursuant to s.66C(2) of the FW Act to not make offers of permanent employment to any casual employees because to do so would be contrary to the merit-based comparative recruitment and selection processes that TAFE has chosen to adopt. The CPSU foreshadowed that once any such position is articulated in TAFE’s submissions it would respond but, for present purposes, it is sufficient to observe that it would not be possible for an employer to adopt a policy or procedure, the effect of which is that it is not required to make any offer of casual conversion under s.66B(1). Section 66C(1) requires an assessment in each case as to whether there are reasonable grounds for not making “the offer” in that case. It would be inconsistent with the purpose of s.66B, and defeat the intended operation of the beneficial provision, if an employer could simply adopt a blanket policy of refusing to make an offer of casual conversion to any casual employee irrespective of the circumstances; the provisions would not be interpreted to lead to that result.

To the extent TAFE suggests that its approach is consistent with s.7 of the GSE Act and Part 3 of the GSE Rules, TAFE otherwise appears to accept that those provisions either do not apply to it or do not require a particular process to be followed: that concession is correct. In particular, Part 3 of the GSE Rules applies only to the NSW public service whereas TAFE employees are employed by TAFE itself and not directly by the NSW Government. As such, those persons are not employed under Part 4 of the GSE Act as part of the public service; and TAFE’s position is purely a matter of policy choice. Further, it is not reasonable for TAFE to refuse to make an offer of casual conversion in any case as a matter of general policy simply because it says it wants to undertake a further merit selection process. Such an approach is not reasonable in circumstances in which TAFE has been content for a casual employee to perform the relevant work in accordance with a regular pattern of hours on an ongoing basis for at least six months and to employ the casual employee for a period of at least 12 months. That is particularly so where the casual employee has already been selected through a form of merit selection to be appointed to casual employment.

In conclusion, the CPSU submits that TAFE does not have reasonable grounds to refuse to offer any of the casual employees to convert to full-time or part-time employment for the purposes of s.66B(2) of the FW Act. It is submitted that the CPSU’s four witness employees (namely, Lauren Ravelli, Wayne Bailey, John Falconer and Angela Hand) each otherwise satisfy the requirements to be entitled to be offered conversion in that they have each been employed by TAFE for at least 12 months, and during at least the last six months of that period, have worked a regular pattern of hours on an ongoing basis which they could continue to work as a full-time or a part-time employee. The CPSU submits that TAFE is required to make an offer to each of those employees under s.66B(1) of the FW Act.

The CPSU asks that the Commission determine that:

(a) TAFE does not have reasonable grounds for the purposes of s.66C(1) and (2)(d) of the FW Act to refuse to make offers of casual conversion to any casual employees who otherwise satisfy the requirements in s.66B(1) to receive such an offer; and
(b) TAFE is required to make an offer under s.66B(1) of the FW Act to Ms Ravelli, Mr Bailey, Mr Falconer and Ms Hand to convert from casual employment to full-time or part-time employment (as appropriate in each case).

The case advanced by TAFE

In responding to the claim of the CPSU that ss.66B and 66C of the FW Act operate to require TAFE to make an offer of full-time or part-time employment to its witness employees, TAFE contends that it is not so required and submits the Commission should find accordingly and dismiss the CPSU’s application. In so submitting, TAFE refers to the evidence adduced in its case by: (a) Julian Oliveux, TAFE’s Director of Workplace Relations; (b) Carmen Jones, currently TAFE’s Manager Workforce Services – Talent Management and Acquisition; and (c) James Canavan, TAFE’s Manager, Industrial Relations.

TAFE makes two broad contentions:

(a) s.66C of the FW Act does not require TAFE to make an offer under s.66B when making the offer would not comply with a recruitment or selection process required by or under a law of a State – namely, s.18 of the TAFE Act, which requires or provides for such a process based on merit – because TAFE making an offer under s.66B of the FW Act based on the two criteria in s.66B(1) would not comply with s.18 of the TAFE Act; and
(b) further, and in the alternative, in all the circumstances there are otherwise reasonable grounds for TAFE not to make an offer under s.66B, within the meaning of s.66C, because TAFE being required to make offers to the employees would be contrary to a merit-based comparative recruitment and selection process that TAFE reasonably adopts in accordance with NSW Government sector core values under s.7 of the GSE Act and the spirit of s.18(1) of the TAFE Act, and Part 3 of the GSE Rules.

On each of these two bases, TAFE submits it is not (and has at no time been) required to make an offer to the employees under s.66B to convert to permanent employment, because TAFE has (and always has had) “reasonable grounds not to make that offer”, within the meaning of s.66C(1)(a) of the FW Act.

In a section of the submissions dealing with the “Factual and legislative background”, TAFE addresses matters including descriptions of: TAFE’s role as the NSW Government’s provider of vocational education and training as a statutory corporation established under the TAFE Act; the statutory objectives and functions of TAFE as specified in ss.5 and 6 of the TAFE Act; and operational-type matters such as the number of campuses, staff, students and courses.

TAFE notes that it: (a) is subject to the direction and control of the relevant Minister pursuant to s.9 of the TAFE Act; (b) has an advisory board named the TAFE NSW Board, which is established under the TAFE Act and makes recommendations to the Minister on policies, strategic planning, and the efficiency and effectiveness of TAFE’s operations; (c) forms part of the “government sector” under the GSE Act and the GSE Rules, and is therefore required to comply with the core NSW Government sector values in Part 2 of the GSE Act. TAFE describes in detail a matrix of matters concerning, for example, the interplay of NSW Government legislation and TAFE’s role, as well as adverting to the evidence concerning “long standing public and governmental function and status, going back to at least 1883”. The GSE Act has as one of its objects “an ethical framework for a merit-based, apolitical and professional government sector that implements the decisions of the Government of the day”. Rule 20 of the GSE Rules provides that the following decisions must be based on a comparative assessment after external advertising:

(a) the decision to employ a person in ongoing employment in a particular classification of work or band and the initial assignment of the person to a role in that classification or band;
(b) any subsequent decision to employ the person in a different classification of work or in a different band and the initial assignment of the person to a role in that classification or band.

Permanent staff appointments in TAFE are based on comparative merit, being the principle that permanent appointments should be awarded to the best person available for the job.

Public sector employment, legislation and principles: TAFE refers to extracts of submissions made by the CPSU, as reproduced in CPSU v Commonwealth of Australia[2022] FWC 1246 (“Services Australia Case”) at [86]-[89] – particularly as to the operation of the merit principle (in the Australian Public Service). TAFE submits the CPSU’s submissions in that case are correct and, it is submitted, are just as relevant at the state level as they are federally.

Permanent and casual employment: TAFE draws attention to the clause 6.3.3 of TAFE’s current Staffing Procedures, whereby the usual basis for the employment of staff is permanent employment. A permanent position is intended to be ongoing and requires consistent hours of work. Permanent staff are entitled to a number of benefits that do not apply to casual staff, including (without limitation): (a) an entitlement to extended leave at the same rate as NSW public service employees under the GSE Act in accordance with s.22 of the TAFE Act; (b) secondments and transfers to other NSW government sector agencies in accordance with s.64 of the GSE Act and Part 6 of the GSE Rules; (c) other benefits under the Enterprise Agreement, including study leave and protection against permanent replacement of their role; and (d) the usual benefits of permanent employment, including ongoing employment, annual leave, sick leave, etc.

Under clause 5 of the Enterprise Agreement, casual employees are employed on an hourly basis to carry out work: (a) that is irregular or intermittent; (b) on a short-term basis in an area of TAFE with a flexible workload; (c) of a position for a short period pending the completion of the selection process for the position; or (d) that is urgent or to deal with an emergency. Casual employees are paid a loading in lieu of the benefits of permanent employment.

Recruitment, engagement and selection: TAFE refers to its Staffing Procedures, which refer to and incorporate the “Merit Selection Guide for NSW public sector panels” (“Merit Selection Guide”) and the “Commentary and Guidelines on Temporary and Casual Employment” (“Commentary/Guidelines”). TAFE refers to the following matters in such respects:

· TAFE’s staff members with recruitment responsibilities are required to complete an online training model which explains TAFE’s recruitment practices and the principle of merit which underlies the appointment of permanent staff.

· In accordance with the Staffing Procedures, and consistently with legislation applicable to appointments in the NSW public service, TAFE approaches the appointment of candidates for permanent positions in a way that is different from the manner in which it employs casual staff, being a distinction that applies in the case of teaching staff and non-delivery staff.

· All appointments to permanent TAFE positions are based on merit. As a matter of practice, this means that appointments are made after a comparative assessment. The purpose of the comparative assessment process is to ensure that appointments are awarded to persons who are not only suitable, in the sense that they have all the skills and qualifications necessary for the appointment, but that they are also the best person for the role. This means that candidates for permanent positions must be ranked in order of merit following a competitive recruitment and selection process. A recruitment and selection panel must choose the best person for the appointment as the highest ranked candidate, and who is the best person fit to perform the requirements of the role.
· In contrast, TAFE has two methods for engaging casual employees which are distinct from a comparative merit assessment: nomination and suitability list. Common to both approaches is a determination that a candidate for a casual role is suitable for the role, in the sense that he or she has all the skills and qualifications necessary for the appointment, as described in the relevant position description. However, the process for engaging casual employees does not require ranking or comparing candidates or selecting the best person available for the role.

Rationale for the different approaches to casual and permanent employees: As explained in TAFE’s evidence, there is a rationale for TAFE’s different approaches to the employment, recruitment and selection of casual employees, as compared to permanent employees. Comparative assessments, which are a long-standing feature of TAFE’s recruitment and selection processes and of the NSW public service more broadly, are an essential element of “merit” selection for permanent positions. If TAFE were to appoint any person to a permanent position without a comparative assessment (regardless of whether that person is currently a casual employee), one of TAFE’s witnesses considers that TAFE would offend its legislative obligations – as elaborated in further reasons why merit-based recruitment is critical to TAFE’s operations:

(a) TAFE is an entity of the NSW Government which is subject to the direction and control of a Minister under s.9 of the TAFE Act and, as such, should have a permanent merit-based, apolitical workforce implementing the decisions of the government of the day;
(b) as TAFE receives the significant majority of its funding from the NSW Government, in order to make appropriate and prudent use of public money, TAFE must ensure that permanent appointments are awarded to the best person available for the job;
(c) although employees of TAFE are no longer strictly part of the NSW public service, TAFE maintains a close identity with the NSW Government and delivers an important service on its behalf. It is therefore appropriate that TAFE adopts an approach to the recruitment of permanent employees that is consistent with that taken by NSW Government agencies, as it has always done. Under rule 20 of the GSE Rules, all appointments to permanent roles in NSW Government agencies must follow a comparative assessment;
(d) comparative assessments help to ensure that TAFE’s decision-making in recruitment is consistent with core NSW Government sector values, including because:
(i) it reduces the potential for subjectivity, prejudice and favouritism, and promotes accountability, in decision-making;
(ii) it helps ensure the public interest is prioritised over any private interests in recruitment decisions;
(iii) should TAFE make appointments to permanent ongoing positions based on mere suitability or length of service (whether as a casual employee or not), the effect would be to lower the standard of merit appointments and the best available person for the job may not be identified or appointed;
(iv) it is consistent with the proper use of resources.

TAFE submits that, consistently with the practice of the NSW public service, it is also necessary that there be efficient and flexible processes to recruit casual employees, particularly given the purposes for which casual employees are typically engaged, i.e., short-term, urgent, or irregular work. It would be impracticable, and an inappropriate use of resources, to engage casual employees through a comparative assessment, which is more time and resource intensive than a suitability assessment, which can be relatively simple and expedient. It is important that, before any casual employee becomes a permanent employee of TAFE, he or she undergoes a comparative assessment and is selected as the best person available for the job. Otherwise, the engagement of casual employees using informal procedures such as nomination could become a “backdoor” method of obtaining a permanent position in TAFE without undergoing a comparative assessment.

The very different approaches to recruitment of casual and permanent employees at TAFE, and their rationale, are set out in detail in further evidence in TAFE’s case. That evidence explains in some detail the complex recruitment practice, being practices that are long-standing and based upon NSW public sector recruitment principles. The evidence indicates that, since before at least 2006, TAFE used the same recruitment practices, policies and procedures that applied within the NSW Department of Education and Training and in the NSW public service. Since 2006, the policies and procedures of TAFE in relation to the recruitment of casual and permanent staff (including administrative staff) have been set out in the Staffing Procedures.

Construction of ss.66B and 66C of the FW Act: TAFE submits that, despite the seeming assertion by the CPSU that ss.66B and 66C should be construed liberally in favour of employees (rather than employers) on the basis that those provisions of the FW Act are “beneficial” provisions, the Commission should not accept this submission. The object of the FW Act is to provide a “balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians” by, among other matters, relevantly and operatively “ensuring a guaranteed safety net of fair, relevant and enforceable minimum terms and conditions through the National Employment Standards”. As a plain reading makes clear, this involves the balancing of the needs, wishes and interests of both employees and employers. The CPSU’s construction is not advanced by characterising ss.66B and 66C as “remedial” or “beneficial” provisions: New South Wales Aboriginal Land Council v Minister Administering the Crown Lands Act: 260 CLR 232 at [92] per Gaegler J, and [32]-[33] (per French CJ, Kiefel, Bell and Keane JJ), and other authorities to which TAFE’s submissions refer.

The text of s.66C of the FW Act provides for – and plainly countenances, in a range of circumstances – an employer deciding, on reasonable grounds, not to make an offer to its eligible casual employee to convert to permanent employment. “Reasonable grounds” should be construed as a broad concept, and one not limited by the non-exhaustive list of possible reasonable grounds provided by s.66C(2).

The “offer to convert” within the meaning of s.66B(2)(b), if made by the employer and accepted by the casual employee, involves a fundamental change in that casual employee’s engagement by the employer, and in the terms and conditions upon which he or she is employed. The Oxford English Dictionary defines “Convert” to mean “to change the form, character or function of something”. Conversion means an appointment to a new position, being a permanent full-time or part-time position. The FW Act is requiring (where relevant prescriptions are met) a national system employer to create a new permanent position for its eligible casual employee.

By operation of s.66K, the effect of conversion includes that the employee who accepts the offer is taken to be a full-time employee or part-time employee of the employer for the purposes of Commonwealth and State laws, any applicable fair work instrument and the employee’s contract of employment.

The expression within the CPSU’s submissions “already been recruited to the job” is inapt to describe what is actually occurring as matter of fact and law when ss.66B and 66C operate. The reality, both factually and legally, is that a person who was engaged as a casual employee, upon acceptance of the offer to convert to full-time employment (s.66B(2)(b)(i)) or to part-time employment (s.66B(2)(b)(ii)) takes up new permanent employment in a newly-created permanent position which did not previously exist. Contrary to the CPSU’s submissions, it is not the “same job”.

Division 4A of the FW Act mandates, in certain prescribed circumstances: (a) the creation of new positions that are permanent – positions which attract a whole range of entitlements not previously enjoyed by the person when they were a casual employee; and (b) appointment of formerly casual employees to the new positions. In the Services Australia Case, the CPSU itself recently made submissions to this effect.

An important result of the “conversion”, and an important element or right or entitlement attached to the new full-time or part-time employment, is that the employment is permanent - as the CPSU appears to acknowledge in its submissions. Permanence of employment in full-time (or part-time) positions in the public sector has long been understood as founded upon, and justified by, the need for an independent civil or public service which acts with integrity, apolitically and professionally: Comcare v Banerji (2019) 267 CLR 373; [2019] HCA 23 at [70] (“Banerji”).

The provision in s.66C(2)(d) of the FW Act to the effect that it is a reasonable ground for an employer to decide not to make an offer to an eligible casual employee to convert, when making the offer would not comply with a recruitment or selection process required by or under a Commonwealth or State law, acknowledges the exceptional nature in Australia of public sector, merit-based employment, such as that recognised in Banerji and found in s.18 of the TAFE Act. Indeed, the Revised Explanatory Memorandum to the Fair Work Amendment (Supporting Australia’s Jobs and Economic Recovery) Bill 2020 (“Explanatory Memorandum”) refers, by way of example - described by TAFE as providing “a comparatively relevant example” - to public sector employment legislation in a Territory and confirms that:

“37. New paragraph 66C(2)(d) is included for the avoidance of doubt. For example, the Public Sector Employment and Management Act 1993 (NT) and the associated Public Sector Employment and Management Regulations 2011 (NT) provide requirements for selecting employees within the Northern Territory Public Service, such as merit selection principles. There is nothing in new Division 4A that would require the Northern Territory Public Service to make an offer for casual conversion under Division 4A if this would be inconsistent with its statutory obligations. In such a case, new paragraph 66C(2)(d) should be read in conjunction with section 40 relating to the interaction between fair work laws and public sector employment laws.”

TAFE has reasonable grounds not to make an offer to the employees: Section 66B(1) of the FW Act requires employers to make offers of permanent employment to eligible casual employees where the relevant statutory qualifying criteria are engaged. Under the transitional provisions in relation to the enactment of the new Division 4A of Part 2-2 of the FW Act, offers were required to be made to eligible casual employees by 27 September 2021. TAFE has not made offers of part-time or full-time employment to the employees, who, but for the operation of s.66C(1) of the FW Act, would otherwise be entitled to receive such offers. As to this, TAFE submits that it was not required to make such offers due to the exception in s.66C(1) of the FW Act. Relevantly, an employer is not required to make an offer under that section to a casual employee if: (a) there are reasonable grounds not to make the offer; and (b) the reasonable grounds are based on facts that are known, or reasonably foreseeable, at the time of deciding not to make the offer. TAFE points to s.66C(2)(d) of the FW Act, which provides that there will be a reasonable ground for not making an offer if doing so “would not comply with a recruitment or selection process required by or under a law of the Commonwealth or a State or a Territory”.

By its first contention, TAFE says that it has a reasonable ground for not making an offer to convert the employees because doing so would not comply with the requirement for a merit-based recruitment and selection process in s.18(1) of the TAFE Act which provides that “The appointment of members of staff and any promotions for such staff are to be made on the basis of the merit of the applicants for appointment or promotion.” The reference to “appointment” in s.18(1) of the TAFE Act is an appointment to a permanent position, and includes persons appointed to a permanent position from a casual position. This construction of s.18(1) of the TAFE Act accords with the long-standing use of the term “appointment” in NSW public sector legislation, and the interpretation given to the term “appointment” in related provisions of the TAFE Act.

Section 18(1) of the TAFE Act requires a “merit”-based assessment of applicants. An open and competitive recruitment and selection process has long been regarded as a minimum requirement of a merit-based process within the NSW Government sector, of which TAFE is a part. A merit-based assessment involves things such as external advertisement, an interview process and a comparative assessment. TAFE’s existing policies and procedures form part of the framework within which the merit principle is applied. Importantly, TAFE’s guidelines, such as the Staffing Procedures, provide that only in exceptional circumstances may a person be appointed without a competitive recruitment and selection process that involves a comparative merit-based assessment. This approach to s.18(1) of the TAFE Act is supported by:

(a) the historical legislative context, including the provisions requiring comparative merit-based appointments in the Public Sector Management Act 1988 (NSW) (“PSM Act”) and the Public Sector Employment and Management Act 2002 (NSW) (“PSEM Act”), which existed at the time of the enactment of (and subsequent variations to) s.18 of the TAFE Act; and
(b) Part 3 of the GSE Rules, which although it does not have direct application, is applied by TAFE in its recruiting and sheds light on the current meaning of a merit-based recruitment and selection process within the NSW Government sector, e.g., rule 20 of the GSE Rules states that decisions to employ persons on an ongoing basis must be based on “a comparative assessment after external advertising” and rule 17 defines a “comparative assessment” as including a specific process for assessment of an applicant against a group of other applicants.

TAFE submits that s.18(1) of the TAFE Act simply does not allow for the appointment of the casual employees to new permanent full-time or part-time positions, merely on the basis of their length of service or their pattern of working hours – which are the only two eligibility criteria prescribed in s.66B of the FW Act. Should TAFE make offers of permanent employment to the casual employees on the basis of the eligibility criteria in s.66B of the FW Act, it would be in contravention of s.18(1) of the TAFE Act because it would not be making appointments “on the basis of the merit of the applicants for appointment”. The conclusion that s.18(1) of the TAFE Act is a “recruitment or selection process required by law” for the purpose of s.66C(2)(d) of the FW Act reconciles the scheme in Division 4A of Part 2-2 of the FW Act with s.19(3) of the TAFE Act. The latter provides that no proceedings for any relief may be taken against TAFE in relation to the non-appointment of a person to a member of staff.

Contrary to the CPSU’s submissions, the key question in the present case is not “whether an offer to convert an existing employee based on the pattern of work performed involves a failure to comply” with s.18(1). The relevant question under s.66C is whether TAFE has (or had) reasonable grounds for deciding not to make an offer under s.66B on the basis (or “ground”) that making the offer would (relevantly) not comply with a recruitment or selection process required by or under a law of a State, namely s.18 of the TAFE Act.

On its plain meaning, s.18 of the TAFE Act requires a merit-based recruitment and selection process in respect of an applicant for a vacant position. By s.18(2), the applicant must be assessed by TAFE on merit by reference to that “position”. The meaning of a merit-based recruitment and selection process includes a process of comparing applicants for a position or job. Unlike permanent employees of TAFE, who go through this process, the casual employees in the present case were not initially employed by means of a comparative or competitive process and this is so notwithstanding what is advanced in the CPSU’s submissions.

TAFE otherwise had reasonable grounds not to make an offer to the employees in all the circumstances: The Explanatory Memorandum acknowledges that there may be other reasonable grounds, in addition to those listed in s.66C(2) on which an employer can decide not to make an offer, “including those specific to their workplace or the employee’s role. Whether a ground is reasonable is to be assessed taking into account all of the circumstances, including the needs of the employer’s business and the nature of the employee’s role.”

TAFE’s evidence makes it clear that there is a further and alternative basis for the Commission to conclude there are reasonable grounds for TAFE not to make an offer under s.66B, within the meaning of s.66C. In all the circumstances summarised to which reference is made in TAFE’s case, for TAFE to be required to make offers to convert the employees would be contrary to a merit-based comparative recruitment and selection process that TAFE reasonably adopts both generally and historically, and more particularly in accordance with NSW Government sector core values under s.7 of the GSE Act, the spirit of s.18(1) of the TAFE Act and Part 3 of the GSE Rules. Having regard to all the circumstances, TAFE has reasonable grounds for not making an offer under s.66B to the four casual employees (or its other casual employees in similar circumstances), within the meaning of s.66C(1)(a) of the FW Act. Those grounds include:

(a) the need for a comparative or competitive selection process based upon merit, in the interests of ensuring an independent and apolitical permanent public sector, of which TAFE forms a well-established part;
(b) the fact that TAFE has long applied and given effect to those important principles through long-standing and established public sector recruitment and selection processes in place for permanent appointments (currently, those contemplated by the TAFE Act and the GSE Act and GSE Rules);
(c) TAFE’s strongly-ingrained public and governmental function and status, and the public sector employment principles and obligations to which it has long adhered (well-before the enactment of the FW Act and Division 4A of Part 2-2).

Jurisdictional issue in relation to one of the four employees: TAFE submits that one of the CPSU’s witness employees works as a casual employee under an enterprise agreement other than the Enterprise Agreement relevant to the present dispute. TAFE submits that her evidence is not relevant to this dispute and should be disregarded and afforded no weight; and the Commission does not have the jurisdiction to make a determination in respect of that particular employee.

TAFE’s submissions concerning the disposition of the dispute: In conclusion, TAFE submits that the Commission should reject the CPSU’s contentions and determine that:

(a) TAFE has reasonable grounds for the purposes of s.66C(1) and (2)(d) of the FW Act to decide not to make offers of casual conversion to any casual employees, who otherwise satisfy the requirements in s.66B(1) to receive such an offer; and
(b) TAFE is not required to make an offer under s.66B(1) of the FW Act to the four casual employees, namely, Ms Ravelli, Mr Bailey, Mr Falconer and Ms Hand to convert from casual employment to full-time or part-time employment, or any other casual employee in a like situation; and
(c) the application pursuant to s.739 of the FW Act should be dismissed.

The CPSU’s reply submissions

By way of general observations with respect to TAFE’s submissions, the CPSU addresses five initial matters before turning to (a) the construction of ss.66B and 66C of the FW Act; (b) s.18(1) of the TAFE Act; (c) the “reasonable grounds” criterion; and (d) concluding remarks.

First, the CPSU notes that TAFE places considerable reliance on the fact that it is a public body with the statutory functions of providing technical and further education services, is the subject of ministerial direction and of some policies and legislation applicable to public sector bodies in NSW. That TAFE is a statutory body representing the Crown, in itself, does not, the CPSU submits, assist in resolving the present dispute. The question raised is whether, in the case of each of its casual employees, TAFE has reasonable grounds to not make an offer of casual conversion for the purposes of s.66C(1) of the FW Act either because to do so would fail to comply with s.18 of the TAFE Act or otherwise. That the casual conversion provisions can appropriately apply to government entities is demonstrated in the Services Australia Case.

Second, TAFE refers to and relies upon statutory provisions applicable to the public service in NSW and “legislation which has historically applied in appointing employees of TAFE NSW and its predecessors”. The CPSU submits that in doing so, TAFE incorrectly records the history of the statutory provisions which have applied to TAFE historically – and some of the erroneous statutory history is also present in TAFE’s evidence. The CPSU sets out what it submits is the correct statutory history:

· In particular, it is not correct for TAFE to say generally that prior to December 2011, staff working in TAFE were employed under legislation applicable to public servants. At least after the passage of the TAFE Act in 1990, TAFE was able to independently employ its own staff who would not be members of the public service. The transitional provisions in clause 9 of Schedule 4 to the TAFE Act provided that certain statutory provisions, awards, agreements and determinations would continue to apply to existing employees within TAFE immediately before the repeal of the Technical and Further Education Act 1974 (NSW) albeit only “until other provision is duly made under this or any other Act”.
· Persons employed within TAFE thereafter were not subject to the provisions applicable to public servants under the PSM Act, the PSEM Act or the GSE Act. In 2006, TAFE ceased to be able to directly employ staff and its existing staff were transferred to the government service. In that period, the TAFE Commission was listed as “Non-Public Service Divisions assigned to statutory corporations” in Part 2 of Schedule 1 to the PSEM Act. From December 2011, all staff were again directly employed by TAFE and not part of the public service. Whatever the prior arrangements, a deliberate decision was made in 2011 to take TAFE employees outside the provisions applicable to the public service.

Third, TAFE relies on selected extracts from the summary of submissions made by the CPSU in the Services Australia Case, but TAFE’s submissions omit reference to the conclusions of the CPSU in that case, which were accepted by the Commission. Relevantly, the CPSU submitted (at [23](93)):

“93. A position that an agency head has discretion not to offer an ongoing position to an eligible casual where it does not wish to, in no way serves the merit principle. It has no connection to merit. Instead, it is an attempt to allow the agency to maintain an unfettered ability to retain a long-term casual workforce.”

Furthermore, the submission that the casual conversion provisions of the FW Act operate to create a permanent or ongoing position in the circumstances set out in s.66B(1) of the FW Act is not inconsistent with the CPSU’s submissions in this case, notwithstanding certain aspects of TAFE’s submissions. To the contrary, the CPSU’s submission in the Services Australia Case proceedings makes clear that there does not need to be a separate, second vacancy to which a casual employee can be appointed. The existing job is converted to permanent employment by operation of the casual conversion provisions in a manner that “recognises that the role already exists”.

Fourth, to the extent that TAFE resists the characterisation of the casual conversion provisions of the FW Act as remedial or beneficial provisions, there can be little doubt that the casual conversion provisions in the FW Act are beneficial in the sense that they are intended to protect casual employees by ensuring that employers do not have an unfettered ability to engage casuals on an insecure basis which denies them access to benefits associated with permanent employment. It does so by requiring employers to offer casual conversion in identified circumstances. Section 66C of the FW Act contains an exception to the requirement to make an offer of casual conversion. However, as an exception to a beneficial entitlement, the section should not be construed more broadly than the text requires.

Fifth, TAFE places considerable reliance on evidence as to its existing policies and procedures in relation to staffing and recruitment. The existing policies and procedures adopted by TAFE cannot determine the interpretation and application of either the provisions of the TAFE Act or the casual conversion provisions of the FW Act. An employer cannot, by unilateral adoption of policies or procedures, avoid the obligation to make an offer of casual conversion in the circumstances specified in s.66B(1). That approach, if accepted, would permit an employer to frustrate the intention of the casual conversion provisions. In any event, the CPSU submissions continue, it is difficult to understand how TAFE’s policies and procedures are said to be an impediment to casual conversion.

Construction of ss.66B and 66C of the FW Act: As to construction, the CPSU submits that the central submission advanced by TAFE is that an “offer to convert” for the purposes of s.66B(2) involves a “fundamental change to the casual employee’s engagement by the employer” and necessarily involves “appointment to a new position”; and that, on TAFE’s submission, casual conversion is not, accordingly, to the “same job”. The CPSU submits that TAFE misunderstands the operation of the casual conversion provisions and the union’s submissions.

The authorities indicate an employee’s “job” comprises the “collection of functions, duties and responsibilities entrusted ... to a particular employee.” Casual conversion is not contemplated to change a casual employee’s “job” in that sense. The offer that an employer must make under s.66B(2)(b) is for a casual employee to convert to full-time or part-time employment. That will involve a fundamental change to the nature of the engagement in the sense that, if accepted, the offer results in permanency. However, the casual conversion provisions do not contemplate that appointment will be to a new job or position in the sense of a new set of duties or responsibilities, but that the offer is to continue undertaking the existing tasks the employee has been performing on the pattern of hours he or she has been undertaking as a casual. That conclusion is consistent with the text of ss.66B and 66C of the FW Act. In particular, s.66B(2)(b) requires the offer of conversion to be made by reference to the hours of work of the employee as a casual during the last six months of casual employment. Further, s.66C(2)(a) provides that one circumstance in which there will be reasonable grounds not to make an offer of casual conversion is if “the employee’s position will cease to exist in the period of 12 months after the time of deciding not to make the offer.” That is, if the employee’s position will cease within 12 months, the employer is not required to offer that the casual employee convert to permanent employment in that position.

Section 18(1) of the TAFE Act: The CPSU notes that the first basis upon which TAFE contends that it has reasonable grounds not to make an offer of casual conversion to any casual employee within TAFE is that, it is said by TAFE, doing so would not comply with the requirement for a merit-based recruitment and selection process in s.18(1) of the TAFE Act. As to that, the CPSU submits that TAFE’s submissions attempt to reframe the question posed by s.66C(2)(d) of the FW Act as being whether TAFE has reasonable grounds for deciding not to make an offer under s.66B on the basis that making the offer would not comply with a requirement under a law of a State, namely, s.18(1) of the TAFE Act. The CPSU submits that no difference arises from framing the question in that way. The CPSU submits that the correct understanding of s.66C is as follows:

(a) s.66C(1) provides that an employer is not required to make an offer of casual conversion if it has reasonable grounds not to make the offer;
(b) s.66C(2) then provides by certain circumstances, if they exist, by definition give rise to “reasonable grounds”. That is, if one of the circumstances set out in s.66C(2) exists, the employer is taken to have reasonable grounds not to make an offer;
(c) relevantly, s.66C(2)(d) deems an employer to have reasonable grounds to refuse to make an offer of casual conversion only if making the offer would not comply with a recruitment or selection process required by or under a law of a State.

For the purposes of TAFE’s first contention, it is permitted to refuse to make an offer by reason of s.66C(2)(d) only if making an offer of casual conversion to an individual employee would not comply, in the sense of resulting in a contravention of, s.18(1) of the TAFE Act.

A critical feature of TAFE’s submissions with respect to its first contention is that s.18(1) of the TAFE Act is concerned only with permanent appointments and not casual appointments. However, TAFE’s submission cannot be reconciled with the terms of the TAFE Act when s.18(1) simply provides as follows:

“18 Appointments and promotion on merit
(1) The appointment of members of staff and any promotions for such staff are to be made on the basis of the merit of the applicants for appointment or promotion. ...”

To the extent s.18(1) applies to “members of staff”, a “member of staff” is defined in s.3(1) of the TAFE Act as follows:

“member of staff or staff member means a member of staff of the TAFE Commission employed under section 15.”

Section 15 of the TAFE Act confers a general power on the TAFE Commission to employ such staff as it requires to exercise its functions and is the source of its capacity to employ any persons, whether on a permanent or casual basis. The application of the definition in s.18(1) demonstrates that it applies of all members of staff.

The CPSU submits that there would be very surprising consequences if a reference to “members of staff” in the TAFE Act were not read as including casual employees. Notably, the privative provision found in s.19(3) of the TAFE Act with respect to the appointment of persons to positions would not apply to casual appointments which could then, unlike permanent appointments, be the subject of proceedings. Casual employees would not be required to report serious offences under s.21B and could not be placed on a “not to be employed” list under s.21C. Where the TAFE Act intends a provision to apply only to some members of staff it expressly says so, e.g., s.21A(4) provides that the prohibition on secondary employment without permission does not apply to casual employees and s.22(1) provides that the extended leave provisions apply only to staff employed on a full-time basis. The phrase “members of staff” is used to refer to all employees of TAFE consistently with the definition in s.3(1).

Once the operation of the TAFE Act is properly understood, the CPSU contends that TAFE’s submission that a contravention of s.18(1) of the TAFE Act will occur if an existing casual employee is offered conversion to permanent employment to undertake a job that he or she is already employed to perform falls away. The requirement for appointment on merit applies to all members of staff. If the TAFE Act is properly applied, a casual employee will have already been employed on merit to undertake the job he or she is performing. It is not inconsistent with, and does not result in a contravention of, s.18(1) of the TAFE Act for that casual employee to be offered conversion to permanent employment to continue to undertake the same duties that he or she is already performing.

To the extent it is relevant, the CPSU posited that that outcome appears to be consistent with TAFE’s existing policies. TAFE’s evidence suggests that its current Staff Procedures incorporate the Merit Selection Guide and the Commentary/Guidelines. The Commentary/ Guidelines require that casual employees may only be employed in accordance with Appendix 1-2, which applies to the employment of casual employees and relevantly provides:

“5.4 Selection and employment
It is Government policy that all employment decisions within the Public Service are based upon the principles of merit selection. The principles of merit selection are to be applied. See the Merit Selection Guide for NSW public sector panels – picking the best person for the job (Section 4 – Principles of merit selection)”

Similarly, the “core values” expressed in s.7 of the GSE Act, including to “recruit and promote employees on merit”, apply to all employment in the NSW Government sector, not only permanent employment.

At its highest, TAFE’s evidence suggests that it utilises a particular procedure for permanent appointments referred to as a “comparative assessment”. The concept of “comparative assessment” arises from rule 17 of the GSE Rules. As TAFE acknowledges, the GSE Rules do not apply to it. It is not possible to read s.18(1) of the TAFE Act as referring to any particular method of merit assessment, much less that it must involve a particular procedure for “comparative assessment”. That is particularly so where the GSE Rules very substantially post-date the enactment of the TAFE Act.

TAFE otherwise has “reasonable grounds”: The CPSU notes that TAFE’s alternative submission is that, leaving aside s.18(1) of the TAFE Act, it has reasonable grounds to not make offers of casual conversion within the meaning of s.66C(1) of the FW Act. The CPSU submits that the precise basis of the submission is somewhat elusive, but appears to be based on the proposition that any offer of casual conversion, in any circumstances, would be contrary to the merit-based comparative recruitment and selection process it has chosen to adopt.

The CPSU submits that the initial difficulty with TAFE’s submission is that its approach is inconsistent with the proper application of ss.66B and 66C of the FW Act. Section 66B requires an offer to be made to a particular casual employee if the circumstances in s.66B(1) exist. Section 66C(1) alleviates the obligation on an employer to make an offer to a particular casual employee if there are reasonable grounds not to make “the offer”. Whether reasonable grounds exist to not make an offer of casual employment to a particular employee will require an assessment of the particular circumstances of each case. It is inconsistent with the very structure of ss.66B and 66C for TAFE to assert that reasonable grounds necessarily arise in each and every case irrespective of the circumstances.

The CPSU submits that, in any event, TAFE’s submissions are unpersuasive. The CPSU strongly supports the maintenance of an independent and apolitical public service. It is simply not inconsistent with maintaining an independent and apolitical public service for offers of casual conversion to be made to casual employees who have already been assessed as appropriate to perform a job and the requirements in s.66B(1) are met (namely, the casual employee has been employed for 12 months and for at least the last six months has worked a regular pattern of hours on an ongoing basis which they could continue to perform as a full-time or part-time employee). Indeed, acceptance of the requirement to offer casual conversion to appropriate casual employees would strengthen the independence of the public sector by reducing the insecurity of employment encountered by long-term casual employees.

The application of the casual conversion provisions of the FW Act would also not prevent TAFE engaging casual employees in a flexible manner. As TAFE notes, clause 5 of the Enterprise Agreement defines casual employment as follows:

“Casual Employee” means a person employed by TAFE NSW:
· on an hourly basis to carry out work that is irregular or intermittent; or
· to carry out work on a short term basis in an area of TAFE NSW with a flexible workload; or

· to carry out the work of a position for a short period pending the completion of the selection process for the position; or
· to carry out urgent work or to deal with an emergency.”

If casual employment is genuinely irregular or intermittent, short-term, or to carry-out urgent work in an emergency, no question of casual conversion would be likely to arise because the circumstances in s.66B(1) would not exist. Even if the circumstances in s.66B(1) arise, TAFE would be entitled not to offer casual conversion in a particular case if the person’s position will cease to exist in the following 12 months or if there will be a significant change to the hours of work or days or times on which work is required to be performed. TAFE would not be prevented from engaging casual employees in the circumstances contemplated by the Enterprise Agreement.

Concluding submissions: The CPSU submits, for these reasons, TAFE’s submissions that it is entitled to refuse, in a blanket fashion, to offer casual conversion to all casual employees must be rejected. TAFE has put forward no reasons why it is not required to offer casual conversion to each of the individual employees in relation to whom evidence has been put forward having regard to their particular circumstances and the Commission should determine, in arbitration of the dispute, that TAFE is required to make such an offer to Ms Ravelli, Mr Bailey and Mr Falconer.

The CPSU acknowledges, as TAFE has contended, that Ms Hand’s employment is not covered by the Enterprise Agreement and she cannot be subject of an arbitration under that agreement; but, the CPSU submits, her evidence remains relevant for the purposes of demonstrating the type of circumstances encountered by casual employees within TAFE. In oral submissions, the CPSU proposed, in effect, that I should make a recommendation, express and opinion, or similar. I advised I did not propose to do so, in circumstances where Ms Hand’s employment is not covered by the Enterprise Agreement under which this dispute is brought before the Commission.

Consideration

I begin my consideration of this matter by noting that, regardless of what have may have prevailed in the past under different legislative frameworks concerning TAFE and its predecessors, and the direct and indirect interlocking arrangements with the NSW Government/NSW public service, TAFE is today a national system employer within the meaning of s.14 of the FW Act. TAFE’s employees are not employees of the NSW public service. It is unnecessary for the purposes of the decision to deal with the parties’ contested accounts of the historic arrangements that formerly applied.

As the CPSU notes, TAFE places considerable reliance on the fact that it is a public body with statutory functions of providing technical and further education services, is the subject of ministerial direction and of some policies and legislation applicable to NSW public sector bodies; but the fact that TAFE is a statutory body with the characteristics described in TAFE’s case does not assist in resolving the present dispute. The question is whether TAFE has reasonable grounds not to make casual conversion offers for the purposes of s.66C(1) of the FW Act, on the basis that to do so would fail to comply with s.18 of the TAFE Act or otherwise.

I also note and accept the CPSU’s submission that the casual conversion provisions in the FW Act comprise “novel” changes. I add that, given the changes are novel, some earlier employment-type precepts may not necessarily fit comfortably with the changes brought about by the comparatively recent legislation.

Absent any other considerations, the provisions of Division 4A of Part 2-2 of the FW Act apply to TAFE. Again, absent any other considerations, the provisions of Division 4A as they concern casual conversion offers (and/or requests) apply as between TAFE and each of the CPSU’s three employee witnesses who are properly the subject of this dispute, namely, Ms Ravelli, Mr Bailey and Mr Falconer. It is common ground that Ms Hand’s employment is not covered by the Enterprise Agreement and, thereby, there can be no arbitration concerning her circumstances under the auspices of these dispute proceedings. As I noted in the proceedings, I will not deal any further with matters concerning Ms Hand in the decision.

The CPSU’s employee witnesses were not required for cross-examination, with the result that their evidence is unchallenged. Moreover, TAFE did not mount any evidentiary challenge of its own to the evidence of those employees albeit TAFE’s oral submissions took to task some of the matters addressed in their evidence.

I am satisfied that Ms Ravelli, Mr Bailey and Mr Falconer meet what I will describe as the qualifying criteria:

·   each employee is employed by TAFE as a casual employee (s.66A);
·   each employee has been employed by TAFE for (at least) a period of 12 months beginning the day the employment started (s.66B(1)(a));
·   during at least the last six months of that period of 12 months, each employee has worked a regular pattern of hours on an ongoing basis which, without significant adjustment, each employee could continue to work as a full-time employee or a part-time employee (as the case may be) (s.66B(1)(b)).

I am also satisfied that each employee has, at different points in time, been through competitive interview/selection processes in relation to his or her employment by TAFE. There was some issue about Mr Falconer’s circumstances and the role he presently holds. I am satisfied on the basis of what was addressed in the CPSU’s oral submissions, by reference to Mr Falconer’s evidence, that he continues to be within the same classification rank in the Enterprise Agreement, even if now occupying in his employment with TAFE a role that is different from the role he originally applied for in the initial competitive interview/selection process. I find that, presumptively, each of the three employees was employed on merit. I will return later to the CPSU’s submissions indicating that it could not have been otherwise, because all employment categories attract the merit criterion under the TAFE Act notwithstanding suggestions to the contrary in the procedures may have adopted from time to time.

Employer offers of casual conversion are not required in certain circumstances, as set out in s.66C of the FW Act as follows:

“66C When employer offers not required

(1) Despite section 66B, an employer is not required to make an offer under that section to a casual employee if:

(a) there are reasonable grounds not to make the offer; and
(b) the reasonable grounds are based on facts that are known, or reasonably foreseeable, at the time of deciding not to make the offer.

(2) Without limiting paragraph (1)(a), reasonable grounds for deciding not to make an offer include the following:

(a) the employee’s position will cease to exist in the period of 12 months after the time of deciding not to make the offer;
(b) the hours of work which the employee is required to perform will be significantly reduced in that period;
(c) there will be a significant change in either or both of the following in that period:

(i) the days on which the employee’s hours of work are required to be performed;

(ii) the times at which the employee’s hours of work are required to be performed;

which cannot be accommodated within the days or times the employee is available to work during that period;
(d) making the offer would not comply with a recruitment or selection process required by or under a law of the Commonwealth or a State or a Territory.”

Thus, s.66C of the FW Act provides that an employer is not required to make an offer under s.66B to a casual employee if there are reasonable grounds not to make the offer, including the ground that making the offer would not comply with a recruitment or selection process required by or under a law of (relevantly) a State. As to that, TAFE refers principally to s.18 of the TAFE Act, more particularly s.18(1). Section 18 reads:

“18 Appointments and promotion on merit
(1) The appointment of members of staff and any promotions for such staff are to be made on the basis of the merit of the applicants for appointment or promotion.

(2) The merit of persons eligible for appointment or promotion to a vacant position are to be determined having regard to—

(a) the nature of the duties of the position, and

(b) abilities, qualifications, experience, standard of work performance and personal qualities of those persons that are relevant to the performance of those duties.”

As noted earlier, TAFE makes two broad contentions. The first contention is that, by s.66C of the FW Act, TAFE is not required to make an offer under s.66B because making the offer would not comply with a recruitment or selection process required by or under s.18 of the TAFE Act, which requires or provides for such a process to be based on merit. That is, TAFE making an offer under 66B of the FW Act based on the two criteria in s.66B(1) would not comply with s.18 of the TAFE Act. TAFE’s further, or alternative, contention is that in all the circumstances there are otherwise reasonable grounds for TAFE not to make an offer because being required to make offers to the employees would be contrary to a merit-based comparative recruitment and selection process that TAFE reasonably adopts. TAFE’s submissions are that this arises in accordance with the NSW Government sector core values under s.7 of the GSE Act, the spirit of s.18(1) of the TAFE Act and Part 3 of the GSE Rules.

I accept the CPSU’s submission that neither of the preceding grounds provides a basis for TAFE to refuse to make offers of casual conversion to the eligible casual employees under s.66B(1) of the FW Act. I also accept the CPSU’s submission that the dedicated casual conversion provisions are plainly designed for a beneficial purpose, for the benefit of casual employees. This is so notwithstanding TAFE’s submissions around the FW Act more accurately providing a “balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians” by, among other matters, “ensuring a guaranteed safety net of fair, relevant and enforceable minimum terms and conditions through the National Employment Standards”. As to TAFE’s submission that “as a plain reading makes clear [this entails] the balancing of the needs, wishes and interests of both employees and employers”, the casual conversion provisions of the FW Act are cast in mandatory language, i.e., s.66B provides that “Subject to section 66C, the employer must make an offer to a casual employee under this section if” the twin service-type criteria are met (subject to the reasonable grounds exception). I accept the CPSU’s submission that, as an exception to a beneficial entitlement, s.66C should not be construed more broadly than the text requires. Equally plainly, however, it should not be read-down, given the exception has work to do and is consonant with the balancing to which TAFE refers.

The CPSU submits it is necessary to start with the proper interpretation of s.66C(2)(d) and whether making an offer to an existing casual employee “to convert” to full-time or part-time employment would “not comply” with a recruitment or selection process required by or under s.18 of the TAFE Act. That is, making the offer “to convert” must result in a contravention of, or be inconsistent with, the TAFE Act to attract the operation of s.66C(2)(d) such as to give rise to reasonable grounds for deciding not to make an offer for the purposes of that provision. For a number of reasons advanced in the CPSU’s submissions, I prefer the constructions advanced by the CPSU to those advanced by TAFE.

As the CPSU points out, correctly in my view, s.66B of the FW Act contemplates that an offer to convert to full-time or part-time employment will be made to a casual employee based upon the existing position and pattern of hours of the employee. It seems to me that what is contemplated by s.66B thereby is not a new appointment of a person from within (or outside) TAFE, but the conversion to permanent employment of an existing employee who already has been recruited – and, relevantly in the case of the three employees in this case given the contentions advanced by TAFE, through merit selection following competitive interview and selection processes. I reiterate that this is novel legislation: it involves conversion.

The three employee witnesses are already employed by TAFE as casual employees and performing the work of their respective positions. An offer to convert the existing employment of the three employees to, as the case may be, full-time/part-time employment to undertake the same job cannot, I consider, be regarded as a new appointment subject to a further “appointment” or merit selection process. Similarly, despite the submissions advanced by TAFE in the proceedings that attaining permanent employment status, if not an “appointment”, would constitute a “promotion” within the meaning of s.18 of the TAFE Act (due to the different conditions of employment attaching to permanent employment), conversion certainly does not, in my view, involve “promotion” - because a promotion contemplates advancement to a higher grade or position within TAFE, and that is not what would occur here.

I also note the CPSU’s submissions that this type of approach is consistent with the way other public sector employment legislation has been interpreted historically as to the meaning of “appointment” and, as the CPSU submits, I accept that no different conclusion would be reached with respect to the concept of “appointment” in ss.18 and 19 of the TAFE Act. As the CPSU submits, the question is whether an offer to convert an existing employee based on the pattern of work performed involves a failure to comply with s.18(1) of the TAFE Act. I think it does not. Further support for this conclusion arises from matters addressed in aspects of the CPSU’s opening submissions, particularly:

· If a casual employee was initially engaged following a merit selection process, a later offer to convert to full-time or part-time employment could not give rise to a failure to comply with s.18(1) of the TAFE Act and could not be justified by reliance on s.66C(2)(d) of the FW Act. Here, each of the CPSU’s three employee witnesses applied for casual employment and was subject to merit selection in the form of an interview and competitive selection – with the result that each such employee has presumptively already been appointed on the basis of merit. To make an offer to convert such an employee in his or her current job to full-time or part-time employment would not result in a contravention of the requirement in s.18(1) of the TAFE Act that appointments be on the basis of merit (including, for the reasons I have outlined, in the case of Mr Falconer who continues to occupy the same classification rank under the Enterprise Agreement).
· TAFE has chosen to adopt a particular policy or procedure, but it would be inconsistent with the purpose of s.66B, and defeat the intended operation of the beneficial provisions, if an employer could simply adopt a blanket policy of refusing to make an offer of casual conversion to any casual employee irrespective of the circumstances.
· TAFE appears to accept that (some of) the GSE provisions either do not apply to it and/or do not require a particular process to be followed (i.e., save as to certain provisions of the GSE Act). The CPSU elaborates (without contest in TAFE’s submissions), that Part 3 of the GSE Rules applies only to the NSW public service, whereas TAFE employees are employed by TAFE itself and not directly by the NSW Government. As such, the three employees are not employed under Part 4 of the GSE Act as part of the NSW public service; and TAFE’s position is “purely a matter of policy choice”.

I am reinforced in my conclusion about such matters when the evidence arising in the cross-examination of TAFE’s Ms Jones is considered. Without any criticism at all of Ms Jones, that close cross-examination squarely indicated that TAFE’s approach as to the policies and/or procedures it adopts was entirely unclear, otherwise characterised by certain manifest inconsistencies in approach and, for example, with references obsolete legislation that no one in TAFE saw fit to change/update over time. I add that the CPSU made what I considered to be a compelling point in closing oral submissions. As noted earlier, TAFE’s case proceeded in part on the basis that the merit-based comparative recruitment and selection processes it adopts is reasonably adopted in accordance with NSW Government sector core values under s.7 of the GSE Act, the spirit of s.18(1) of the TAFE Act, and Part 3 of the GSE Rules. The CPSU points out that the then-prevailing NSW Parliament decided, in the legislation it enacted, that TAFE should be subject to the FW Act and, similarly, determined that TAFE should not be within the GSE Rules – whereas it could have decided otherwise.

I note that TAFE draws attention to its current Staffing Procedures, whereby, it is submitted, the usual basis for the employment of staff is permanent employment – but, of course, that is not the case with the three employee witnesses. To the extent that TAFE’s submissions highlight various employment benefits that do not apply to casual staff, the witnesses’ evidence indicated that those were the very types of benefits they hoped to obtain (albeit they otherwise presently receive a casual loading). The characteristics of their working patterns relevantly have not been, within the meaning of clause 5 of the Enterprise Agreement: irregular or intermittent casual engagement; engagement as a casual on a short-term basis; engagement on a casual basis for a short period pending the completion of the selection process for a position; or an urgent casual engagement or engagement to deal with an emergency. For example, senior counsel for the CPSU referred to one of the employees as having worked, in effect, for “years and years and years” for TAFE as a casual employee – which is the case, notwithstanding what is set out in the Enterprise Agreement. I separately note that if the casual employment was genuinely irregular or intermittent, short-term or to carry-out urgent work in an emergency, it appears no question of casual conversion would be likely to arise because the casual conversion provisions of the FW Act would not be engaged.

I also note that, in accordance with the Staffing Procedures, and consistently with what TAFE contends is the legislation applicable to appointments in the NSW public service, TAFE has determined to approach the employment of candidates for permanent positions in a way that is different from its employment of casual staff. TAFE’s case describes what happens in such respects, as “a matter of practice” in terms of “comparative assessment” (for permanent roles) and “nomination” and “suitability list” (for casual roles). A detailed rationale is given by TAFE for its different approaches to the recruitment, selection and employment of casual employees as against permanent employees: comparative assessments are described as a long-standing feature of TAFE’s recruitment and selection processes and the NSW public service more broadly and is an essential element of “merit” selection for permanent positions. TAFE’s case points to concern that if it were to appoint any person to a permanent position without a comparative assessment (regardless of whether that person is currently a casual employee), that TAFE would offend its obligations under NSW legislation. However, the evidence in cross-examination of Ms Jones indicated that what has been adopted by TAFE is a matter of what was described as “custom and practice” (even if that custom and practice is “not documented”) - with, as I have noted earlier, the source being entirely unclear and also having what was described as a “degree of variation”. Drawing from the analysis advanced in the CPSU’s case of the relevant provisions, it seems reasonably clear that merit selection is required for the various forms of employment within TAFE, including casual employment – and it would seem an odd thought that it might be contended to be otherwise.

While I do not address all the matters detailed in TAFE’s rationale, I reiterate that while TAFE is an entity of the NSW Government, its employees are not NSW public servants even though, as TAFE submits, it “maintains a close identity with the NSW Government and delivers an important service on its behalf”. That TAFE submits it “is therefore appropriate that TAFE adopts an approach to the recruitment of permanent employees that is consistent with that taken by NSW Government agencies, as it has always done” amplifies the selection, however described, that is being exercised here by TAFE. For example, TAFE’s submissions indicate that Part 3 of the GSE Rules, which although it does not have direct application, is applied by TAFE in its recruiting and sheds light on the current meaning of a merit-based recruitment and selection process within the NSW Government sector, e.g., rule 20 of the GSE Rules states that decisions to employ persons on an ongoing basis must be based on “a comparative assessment after external advertising” and rule 17 defines a “comparative assessment” as including a specific process for assessment of an applicant against a group of other applicants. But, I reemphasise, the CPSU’s submissions persuasively demonstrate that the merit criterion is legislatively applicable to all categories of TAFE employment and not only to permanent employment. Moreover, as I have noted earlier, the cross-examination of Ms Jones indicated that what was advanced as the primary position of TAFE was not necessarily the case. I add separately that the circumstances concerning Ms Ravelli’s successful application for employment with TAFE, and the documentary evidence of the advice that she received from TAFE in such respects (including advice concerning the “eligibility list” and “order of merit”), was described in TAFE’s evidence as “an anomaly”.

The CPSU notes that TAFE places considerable reliance on evidence as to its existing policies and procedures in relation to staffing and recruitment, but those policies and procedures cannot determine the interpretation and application of either the provisions of the TAFE Act or the casual conversion provisions of the FW Act. I accept the submissions by the CPSU that an employer (in this case TAFE) cannot, by the unilateral adoption of policies or procedures, avoid the obligation to make an offer of casual conversion in the circumstances specified in s.66B(1). That approach, if accepted, would permit an employer to frustrate the intention of the casual conversion provisions. In any event, the CPSU submissions continue, it is difficult to understand how TAFE’s policies and procedures are said to be an impediment to casual conversion. Moreover, I repeat that what was described in certain evidence-in-chief for TAFE emerged as being an undocumented custom and practice, and with a degree of variation and an unclear source.

The CPSU draws attention to what it describes as TAFE’s submissions being unable to be reconciled with the terms of the TAFE Act when s.18(1) provides – no more and no less – as follows:

“18 Appointments and promotion on merit
(1) The appointment of members of staff and any promotions for such staff are to be made on the basis of the merit of the applicants for appointment or promotion. ...”

The CPSU notes that, to the extent that s.18(1) applies to “members of staff”, a “member of staff” is defined in s.3(1) of the TAFE Act to mean “a member of staff of the TAFE Commission employed under section 15.” Section 15 of the TAFE Act confers a general power on the TAFE Commission to employ such staff as it requires to exercise its functions and is the source of its capacity to employ any persons, whether on a permanent or casual basis – and the application of the definition in s.18(1) demonstrates that it applies of all members of staff. The CPSU submits that there would be very surprising consequences if a reference to “members of staff” in the TAFE Act were not read as including casual employees. The CPSU submits that some “notable” examples in such respects include:

· the privative provision found in s.19(3) of the TAFE Act with respect to the appointment of persons to positions would not apply to casual appointments which could then, unlike permanent appointments, be subject of proceedings;
· casual employees would not be required to report serious offences under s.21B and could not be placed on a “not to be employed” list under s.21C.

The CPSU’s submissions continue that where the TAFE Act intends a provision to apply only to some members of staff it expressly says so, for example:

· s.21A(4) of the TAFE Act provides that the prohibition on secondary employment without permission does not apply to casual employees;
· s.22(1) provides that the extended leave provisions apply only to staff employed on a full-time basis.

The phrase “members of staff” is used to refer to all employees of TAFE consistently with the definition in s.3(1). The CPSU contends that once the operation of the TAFE Act is properly understood, TAFE’s submission that a contravention of s.18(1) of the TAFE Act will occur if an existing casual employee is offered conversion to permanent employment to undertake a job that he or she is already employed to perform “falls away”. The requirement for appointment on the basis of merit applies to all members of staff. If the TAFE Act is properly applied, it follows that a casual employee will already have been employed on merit to undertake the job he or she is performing. It is not inconsistent with, and does not result in a contravention of, s.18(1) of the TAFE Act for that casual employee to be offered conversion to permanent employment to continue to undertake the same duties that he or she is already performing. I accept the CPSU’s submissions in such respects.

The CPSU submits that, to the extent it is relevant, that outcome appears to be consistent with TAFE’s existing policies. TAFE’s evidence suggests that its current Staff Procedures incorporate the Merit Selection Guide and the Commentary/Guidelines. The Commentary/ Guidelines require that casual employees may only be employed in accordance with Appendix 1-2, which applies to the employment of casual employees and relevantly provides, as to selection and employment: “It is Government policy that all employment decisions within the Public Service are based upon the principles of merit selection. The principles of merit selection are to be applied. See the Merit Selection Guide for NSW public sector panels – picking the best person for the job (Section 4 – Principles of merit selection)”. Similarly, the “core values” expressed in s.7 of the GSE Act, including to “recruit and promote employees on merit”, apply to all employment in the NSW Government sector, not only permanent employment.

The CPSU submits that, at its highest, TAFE’s evidence suggests that it utilises a particular procedure for permanent appointments referred to as a “comparative assessment”, arising from the GSE Rules. However, as TAFE acknowledges, the GSE Rules do not apply to it. Moreover, it is not possible to read s.18(1) of the TAFE Act as referring to any particular method of merit assessment, much less that it must involve a particular procedure for “comparative assessment” - particularly where the GSE Rules substantially post-date the enactment of the TAFE Act.

TAFE submits that the reference to “reasonable grounds” in s.66C should be construed as a broad concept and one not limited by the non-exhaustive list of possible reasonable grounds provided by s.66C(2). While I accept this is the case (as does the CPSU), I am not satisfied that what is the relied on by TAFE as to dictionary definitions; the submission that conversion means an appointment to a new position, being a permanent full-time or part-time position; and/or the FW Act is requiring (where relevant prescriptions are met) a national system employer to create a new permanent position for its eligible casual employee.

The CPSU notes that a central submission advanced by TAFE is that an “offer to convert” for the purposes of s.66B(2) involves a “fundamental change to the casual employee’s engagement by the employer” and necessarily involves “appointment to a new position”; and that TAFE contests the CPSU’s contention that casual conversion is not to the “same job”. The CPSU further notes an employee’s job comprises the collection of functions, duties and responsibilities entrusted to a particular employee. Casual conversion is not contemplated to change a casual employee’s “job” in that sense. The casual conversion offer is for a casual employee to convert to full-time or part-time employment – involving a fundamental change to the nature of the engagement because, if accepted, the offer results in permanency. The CPSU submits, correctly in my view, that the casual conversion provisions do not contemplate that appointment will be to a new job or position with a new set of duties or responsibilities, but rather that the offer is to continue undertaking the existing tasks the employee has been performing on the pattern of hours he or she has been undertaking as a casual, being a conclusion that is consistent with the text of ss.66B and 66C of the FW Act. In particular, s.66B(2)(b) requires the offer of conversion to be made by reference to the hours of work of the employee as a casual during the last six months of casual employment. Further, s.66C(2)(a) provides that a circumstance in which there will be reasonable grounds not to make an offer of casual conversion is if “the employee’s position will cease to exist in the period of 12 months after the time of deciding not to make the offer.”

It seems to me that, despite TAFE’s submission, it is not the case that under the casual conversion offer/acceptance provisions that the employee takes up new permanent employment in a newly-created permanent position which did not previously exist. It is, as TAFE otherwise submitted, a legislative conversion - a different type of employment relationship which arises by way of what TAFE aptly described as a “legislative fiat”. It is some form of change of status, a changeover perhaps, of the same job or role from casual to permanent. It is not a new “appointment” (or a “promotion”) and it does not activate s.18 of the TAFE Act.

I am not persuaded by TAFE’s submissions about the FW Act’s casual conversion provisions as they concern TAFE as being, in effect, antithetical to “the exceptional nature in Australia of public sector, merit-based employment”. As I have noted earlier, I accept the analysis advanced by the CPSU that under the TAFE Act all members of staff are relevantly subject to merit selection (or, accepting the correctness of what has been advanced by the CPSU in its analysis, at least should have been). TAFE submits that s.18(1) of the TAFE Act simply does not allow for the appointment of the casual employees to new permanent full-time or part-time positions, merely on the basis of the employees’ length of service or their pattern of working hours, being the only two eligibility criteria in s.66B of the FW Act; and submits that offers of permanent employment to the casual employees based on those eligibility criteria would be in contravention of s.18(1) of the TAFE Act, because it would not be making appointments “on the basis of the merit of the applicants for appointment”. I have dealt elsewhere in the decision with my conclusions that address TAFE’s submissions in such respects.

Otherwise, TAFE’s references to s.19(3) of the TAFE Act in it written submissions are inapposite concerning this dispute. (I note from the file record that, before the application was allocated to me, TAFE’s position was that the Commission does not have jurisdiction over these proceedings by operation of s.19(3) of the TAFE Act. However, in correspondence dated 30 June 2022, TAFE’s solicitors advised that TAFE no longer pressed that jurisdictional objection – and that was further confirmed in the hearing.) I have considered particularly TAFE’s reference to the extract of the Explanatory Memorandum set out earlier in the decision, exampling public sector-type legislation of the Northern Territory (and I have also noted what appears to be an erroneous reference in the final paragraph of the relevant text to s.40 of the FW Act as involving the “interaction between fair work laws and public sector employment laws”). My consideration of what is in the Explanatory Memorandum does not lead me to any different view about the disposition of the dispute. I have before me a dispute brought under s.739 of the FW Act and a consideration of whether TAFE has reasonable grounds not to make casual conversion offers, arising from the operation of the particular legislation to which it refers and the particular procedures or policies it otherwise adopts – and I have made findings about such matters.

Conclusion

In arbitration of the dispute, I conclude that TAFE must make casual conversion offers to Ms Ravelli, Mr Bailey and Mr Falconer. That is, TAFE is required to make an offer under s.66B(1) of the FW Act to Ms Ravelli, Mr Bailey and Mr Falconer to convert from casual employment to full-time or part-time employment (as appropriate in each case). I add that the offers to each of the three employees should be attended to forthwith. As I have otherwise noted, Ms Hand’s employment is not covered by the Enterprise Agreement and so her circumstances are not properly within the scope of the dispute before the Commission.

Despite the submissions by the CPSU that I should cast my findings more broadly than those three employees, I do not propose to do so. I do not consider that it would be appropriate to do so when the evidence that was before me relevantly concerns only those three employees.

The proceedings in relation to this dispute are now concluded.

COMMISSIONER

Appearances:

M Gibian SC for the CPSU.
Y Shariff SC for TAFE.

Hearing details:

2022.
Sydney:
November 9 (in person), 10 (by Teams video).

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