Health Services Union v Southern Health
[2010] FWA 8048
•4 NOVEMBER 2010
Note: An appeal pursuant to s.604 (C2011/4162) was lodged against this decision - refer to Full Bench decision dated 28 July 2011 [[2011] FWAFB 4719] for result of appeal.
[2010] FWA 8048 |
|
DECISION |
Fair Work Act 2009
s.739 - Application to deal with a dispute
Health Services Union
v
Southern Health
(C2009/10048)
COMMISSIONER CRIBB | MELBOURNE, 4 NOVEMBER 2010 |
Alleged dispute regarding payment for public holidays.
[1] This matter is an application under section 739 of the Fair Work Act 2009 (the Act), by the Health Services Union (the union), for Fair Work Australia to deal with a dispute. The dispute is between the union and Southern Health and it relates to the calculation of payment for public holidays not worked in respect of part time employees of Southern Health.
[2] The dispute was the subject of conciliation on 28 July 2009, 9 September 2009 and 25 March 2010. As the matter was not settled, the union elected to proceed to arbitration. There was a hearing on 20 May 2010.
[3] Dr R Kelly, from the Health Services Union, represented the union and Mr R Corboy, from the Victorian Hospitals’ Industrial Association (VHIA), represented Southern Health.
[4] Mr T Nagle, from Southern Health, and Ms M Barrett, from VHIA, were called as witnesses on behalf of the respondent.
WITNESS EVIDENCE
Mr Nagle
[5] Mr Nagle provided a written statement 1 in addition to giving oral evidence.
[6] It was Mr Nagle’s evidence that it was his understanding that the payment for part time staff for public holidays not worked arose from a decision by Blair C. 2 He explained that he also understood that the matrix of documents which underpins the way Payroll pays part time employees in this situation also included the award, agreement and a VHIA explanatory document regarding Blair C’s decision.3 Mr Nagle stated that the calculation in Blair C’s decision is applied to nurses and medical scientists as well.4 He also said that, to his knowledge, the way that Southern Health applied Blair C’s decision was consistent with the rest of the public health sector.
[7] Mr Nagle confirmed that 296 part time employees are covered by the applicable agreement. Mr Nagle indicated that his understanding of how Payroll calculated these employees’ payments was based on a briefing by the senior Payroll person. 5 He explained that, when Payroll received the timesheet of an employee concerned, they looked for the longest shift worked (if variable shifts were worked) and chose the longest as the “shift length” to be inserted in the second column in the Example table. It was indicated that, in neither the clause in the Public Health Sector (Medical Scientists, Pharmacists and Psychologists) - Southern Health Certified Agreement 2004 - 2007 (2004 Medical Scientists et al Agreement) nor the Public Health Sector (Medical Scientists, Pharmacists and Psychologists) Multi-Enterprise Agreement 2008 - 2011 (2008 Medical Scientists et al Agreement), was it stated that the longest shift length was to be used in the calculation of the penalty.6
[8] The reason for using the longest shift length in the calculation was said to be that, although the Example gives a shift length of eight hours, an employee whose shift length was more than eight hours would be disadvantaged. Therefore, the greatest shift length on an employee’s time sheet was used. 7 Mr Nagle also indicated that shift lengths varied for employees covered by the 2008 Medical Scientists et al Agreement from 7 hours and 36 minutes or 8 hours to 10 hours. He also said that part time staff could work any hours by agreement.8 Mr Nagle stated that nurses worked shift lengths of 10 hours, 12 hours, 10.5 hours, 8 - 6 hours - both full time and part time employees.9
Ms Barrett
[9] It was Ms Barrett’s evidence that she had previously been employed by the Health Services Union (HSU) and had provided advice in that role to nurses and also to employees covered by the 2004 and 2008 Medical Scientists et al Agreements. 10
[10] Ms Barrett was also asked about her understanding of the clause regarding part time employees and public holidays in the Nurses (Victorian Public Health Sector) Multiple Business Agreement 2007 - 2011 (2007 Nurses Agreement). She explained that the table was applied as the average hours of the nurse multiplied by the shift length and then by the base payment and the appropriate penalty. Ms Barrett stated that the shift length may not always be eight hours as there are varying shift lengths in nursing. 11
[11] With respect to the 2004 enterprise bargaining agreement (EBA) negotiating round, Ms Barrett indicated that she had been involved in the negotiations. She recalled that the 2007 Nurses Agreement had incorporated all of the terms and conditions of the previous agreement. This included the part time public holiday clause in question. 12 She said that the same clause was contained in the 2004 and 2008 Medical Scientists et al Agreements including the table.13
[12] Ms Barrett’s recollection was that there had not been a dispute between the HSU and the VHIA about the interpretation of the clause, in particular, the multipliers. She confirmed that, in her view, the table provided that the average hours are multiplied by whatever the shift length is (which varies) which gives the base payment which is then multiplied by the applicable penalty rate. 14 Ms Barrett stated that the shift length in the formula was variable and that, for a part-time employee, it would be dependent on the shift length specified in their contract. It was indicated that this could be different for different people. She indicated that for nurses, the shift length varied and depended on the ward they were rostered in.15 She was unsure whether the employees covered by the 2004 Medical Scientists et al Agreement had their shift length specified in their contracts.16
SUBMISSIONS
HSU
[13] Dr Kelly, on behalf of the HSU, indicated that this matter arose from a complaint from a medical scientist member employed at Southern Health who worked four hours over five days a week. The issue began when the clause in question was applied to the medical scientists in a way which was inconsistent with the advice provided by the union to its members. It was stated that the medical scientist had been paid four hours as the shift length whereas the union had advised that the shift length should be eight hours where the common shift length for a full time person is eight hours. The union, and the medical scientist’s view was that Southern Health had misapplied the formula in the clause by not applying a shift length of eight hours when the employee’s usual rostered working hours were less than eight hours a day. 17
[14] It was stated by Dr Kelly that the nub of the issue was what is meant by the term “shift length” in the formula. 18 Dr Kelly indicated that there were two pertinent industrial instruments - the 2004 Medical Scientists et al Agreement and the current 2008 Medical Scientists et al Agreement. She intended to rely on the 2008 Medical Scientists et al Agreement as it had come into operation on 1 July 2008 although, at the time the dispute arose, it had not been certified. However, it did incorporate the terms and conditions of previous agreements and the award.19 In addition, Dr Kelly stated that she would also be referring to the 2007 Nurses Agreement.
[15] Dr Kelly described the history of ADOs and specifically referred to:
- The Reduced Hours of Work Composite Agreement between the Health Commission of Victoria and the Victorian Hospitals Association, 1983. 20 It was stated that the agreement formed the basis of the implementation of ADOs into the public health sector.21
- As part of the 2000 negotiations, ADOs were restored and the clause in dispute was introduced into both the nurses and medical scientists et al agreements as the result of a decision by Blair C. 22
- Blair C’s decision 23 regarding part time employees and public holidays, as it related to the medical scientists et al agreement was issued on 21 December, 2000.24 The Commissioner’s decision regarding the nurses agreement was issued on 31 August 2001.25
[16] It was contended by Dr Kelly that, in his decision of 21 December 2000, Commissioner Blair had adopted the nurses decision and applied it to medical scientists. 26 Dr Kelly explained that the nurses clause had changed over time but that, except for the quantum of the penalty, the medical scientists clause had largely remained the same.27 She also said that, given clause 4 in the current medical scientists agreement, the Tribunal was able to refer to the 1983 Reduced Hours Agreement to be informed as to the context of this matter.28
[17] In addition, Dr Kelly stated that the HSU No. 4 branch had never had discussions or entered into an understanding with VHIA or individual hospitals about the operation of the clause in question. 29
[18] With respect to the way in which the clause should be applied, it was argued by the union that “shift length” refers to the shift in a particular area in which the work is performed. It was submitted that this contention had been supported by the evidence of Ms Barrett who had indicated that both part time and full time nurses work the same shift length. It was contended, therefore, that if there is a particular shift length in a department, both part time and full time nurses worked the same length of shift eg eight hours or 10 hours, in order to maintain the nurse-patient ratios. 30 The only difference was said to be if a short shift (six hours) was worked as it would probably be only part timers who worked the short shifts.31
[19] Dr Kelly submitted that this situation, which pertained to nurses, was quite different to that of medical scientists. She did not disagree with Ms Barrett’s and Mr Nagle’s evidence that the majority of shifts worked by nurses were eight hour shifts. The union also did not disagree with Mr Nagle’s evidence that medical scientists, dietitians, audiologists, pharmacists and psychologists at Southern Health work eight hour shifts. 32 Dr Kelly indicated that the 2008 Medical Scientists et al Agreement provided for a 10 hour shift but it was her understanding that all the shifts worked at Southern Health were eight hour shifts.33
[20] It was the union’s contention that the formula was concerned with a situation where a part time employee is not rostered to work on that day. Dr Kelly argued that, an employee who is not rostered on that day and who would never be, has an entitlement to pro rata payment of what the shift on that day would be in the department in which they worked. 34 It was submitted that the method of setting the hours of work of part time medical scientists does not refer to shifts but to the number of hours. Dr Kelly highlighted clause 19 of the 2008 Medical Scientists et al Agreement and indicated that it referred to the hours to be worked each day; the days of the week to be worked and the actual starting/finishing times. She stated that, where a part time employee will never work on a public holiday, the formula would be applied on the basis of what the shift length should be pro rata in accordance with the proportion of average hours worked per week of a full time employee.35 It was submitted that, therefore, the formula should be applied as the average number of hours per week, divided by 38 and multiplied by a shift length of eight hours.36 If the shift length in the department was 10 hours, then the shift length in the formula was said to be 10 hours rather than 8 hours.37 The underpinning concept was that a part time employee should be receiving the same as a full time employee except on a pro rata basis.38 Dr Kelly argued that, to do otherwise, would lead to an absurd situation where employees who work the same number of hours per week, but have different patterns of work, would receive different payments for public holidays on which they were not rostered.39
[21] In summary the union did not accept VHIA’s position regarding the part time clause. It was argued that the clause did not say:
“......in applying a shift length somehow you go to the hours of work of an individual employee, and then even if you go [to] the hours of work of an individual employee, that you look at the date on which they worked the longest hours and somehow that becomes the shift length. Our submission is that the part time employees, they don't work shifts.....their hours are not defined as shifts. They may work part of a shift. They may work four hours a day, but their hours of work are not defined in terms of shifts. The shifts relate to the working of hours in the department.” 40
[22] The HSU contended that VHIA’s view of the clause required additional things to be put into the clause that were not actually in the clause. 41
[23] Finally, Dr Kelly took the Tribunal to the anti-discrimination clause of the 2008 Medical Scientists et al Agreement (clause 6). It was submitted that VHIA’s position regarding the clause discriminated against employees with family responsibilities as they cannot work a full shift, only part of a shift. To utilise a variable shift length for a part time employee, instead of the full time (department’s) shift length, was said to be both indirect and direct discrimination. 42
VHIA
[24] VHIA, on behalf of Southern Health, submitted that they held a different view of how the part time public holidays clause operated. Mr Corboy indicated that the question to be answered was - what is a shift length? 43 The genesis of the argument was said to be found in Blair C’s decision44 of 31 August 2001 when he proposed the formula with respect to the nurses agreement. It was contended that Commissioner Blair was well aware at the time that nurses worked different shift lengths. Mr Corboy said that, by way of a decision45 on 21 December 2000, Commissioner Blair had then applied his decision with respect to the Nurses Agreement to the Medical Scientists Agreement:
“The provision as as per clause 284 of the General Nurses decision is to apply.” 46
[25] It was argued that the nurses and medical scientists clauses were linked on the basis that the nurses clause was adopted into the medical scientists’ agreement. 47 Further, Mr Corboy contended that, underpinning the Blair C decision, with respect to medical scientists et al, was the Public Health Sector (Medical Scientists, Pharmacists and Psychologists) Certified Agreement 2000 (2000 Agreement). This provided for the Agreement to be read in conjunction with the Health Services Union of Australia (Victoria - Public Sector) Interim Award 1993 (1993 Interim Award). It was stated that the 1993 Interim Award provided for part time employees to work any shift length within the parameters of a maximum of 10 hours or five shifts of a maximum of seven hours 36 minutes each day. Therefore, VHIA contended that the 1993 Interim Award was not authority for eight hours but rather seven hours 36 minutes.48 This was also said to be the situation with respect to the replacement Medical Scientists, Pharmacists and Psychologists (Public Sector - Victoria) Award 2003 (2003 Award) which also provided, at clause 24, for the ordinary hours of work to be five shifts of 7.36 hours each or four shifts of 10 hours each.49
[26] In terms of the Reduced Hours Agreement 1983, Mr Corboy submitted that it did not apply in this matter although it was referred to in the individual 2000 enterprise bargaining agreements eg Sunbury Community Heath Centre Inc. 50 The reason was that the 2004 Agreement and 2003 Award replaced the 1993 Interim Award.51 The current 2008 Medical Scientists et al Agreement, at clause 46, was stated to contain the same wording as the 2003 Award.52
[27] The VHIA also contended that, in his decision, Commission Blair had anticipated that the shift length would change eg 10 hour night shift. Mr Corboy noted that the union agreed that the shift length could change. He referred to Ms Barrett’s evidence when she said that there were nurses who worked seven hours 36 minutes. 53
[28] With respect to the table contained in the clause, it was argued that it was an example and not a definitive ratio. The reason for this was that the example given in the first column meant that it could change as part time employee’s hours did vary as did their shift length. VHIA contended that there was no one identified shift length in either the nurses or medical scientists’ industrial instruments. 54
[29] In terms of the union’s argument that the “pro rating” contained in the clause meant pro rating of a full time employee’s hours ie. eight hour shifts, Mr Corboy stated that the term “pro rating” had a variety of meanings and that the one put forward by the union was not accepted. 55
[30] Mr Corboy disputed the union’s contention that a part time employee would never work on a particular public holiday. Rather, it was argued that the clause also applied to part time employees whose days changed eg rotating roster. 56 Mr Corboy also contended that the second column in the table needed to record the realities of the employee’s working pattern. It was inequitable to include a full time employee’s shift length as what had to be recorded was the time the employee would have worked or had actually worked. Mr Corboy stated that, if the employee had worked on that day, they would not have been paid eight hours but the hours actually worked.57
[31] Further, Mr Corboy submitted that the benefit of the public holiday clause arose from what an employee worked or ordinarily worked. Therefore, it should reflect the ordinary shift pattern of the employee. He did not concede that the shift length related to a full time shift as the clause did not state that the eight hours had been adopted from a full time employee. 58
[32] With regard to Southern Health’s method of calculating “shift length”, it was Mr Corboy’s contention that, given the variety of shift lengths, the employee was given the benefit of the doubt as the highest ratio was used in the formula. VHIA stated that no employee was being disadvantaged by this calculation method. It was re-iterated that the table was viewed as an example and that it allowed for variance in the number of hours worked. 59
[33] Mr Corboy referred the Tribunal to a number of cases in support of the contention that a commonsense meaning or ordinary meaning/common practice/custom and practice approach should be adopted in ascertaining the meaning of words in an agreement. 60
[34] In summary, the VHIA argued that there was witness evidence about the custom and practice that has been operating since 2001 within the public health sector. It was asserted that this issue had not been raised prior to this matter. The union’s submissions were rejected and it was contended that Southern Health’s approach to the table was correct and in accordance with the clause. 61
CONCLUSIONS
[35] The parties to this dispute have requested that the Tribunal assist in resolving their dispute by clarifying “shift length” in the table of clause 25.2 of the 2004 Agreement.
[36] The union and the VHIA/Southern Health have different views as to how the table (formula) in the clause is operationalised (with respect to shift lengths).
[37] The current agreement which covers the parties is the 2008 Medical Scientists et al Agreement. Clause 68.5 of this Agreement is in the same terms as clause 25.2 of the 2004 Agreement which was the applicable Agreement at the time the dispute arose. For ease, I will refer, as the parties have done, to clause 68.5 of the 2008 Medical Scientists et al Agreement as this Agreement has replaced the 2004 Agreement and the relevant clause has not changed in this process.
[38] Clause 68.5 of the 2008 Medical Scientists et al Agreement provides as follows:
“68.5. Public Holiday Pay For Part Time Staff Rostered Off
68.5.1 To determine the entitlement to public holidays for part-timers rostered off on a public holiday the following shall apply:
68.5.1(a) Where a public holiday occurs on a day a part-time employee normaIly works, but the employee is not required to work, the employee is entitled to receive the public holiday benefit as prescribed by this Agreement.
68.5.1(b) Where a public holiday occurs on a day a part-time employee is not rostered to work the employee shall receive payment according to the following formula.
68.5.2 Average weekly hours over the previous six months are to be determined and a pro-rata payment made, regardless of whether the employee would ever work on that day of the week.
Example:
Average Hours | Shift Length | Base Payment | Penalty | Payment |
24 hours | X 8 hours | 5.05 hours | T 1.0 | 5.05” |
38 hours |
[39] I have given lengthy and detailed consideration to all of the material before me.
[40] The parties, as indicated above, have sought guidance regarding how “shift length” in the formula contained in the table in clause 68.5.1.(b) should be operationalised.
[41] This clause applies in a situation where a public holiday occurs on a day when a part time employee is not rostered to work. It also contemplates that an employee might never work on that day of the week. Clause 68.5.1.(b) is in two parts - text which sets out the entitlement and - a table containing an example of how the payment is to be calculated in accordance with the clause (the text).
[42] It is my view that the table cannot be considered in isolation from the preceding text. The starting point, therefore, is consideration of the text. The parties are in agreement that the first sentence defines the entitlement as applying to a part time employee who is not rostered to work on a public holiday. There was little in the parties’ submissions regarding the next paragraph of the clause. Notice has to be taken of it as it sets out in words how the entitlement is to be calculated. This part of the clause requires that the average weekly hours of a part time employee over the previous six months be determined. Then, a pro-rata payment is to be made.
[43] When the first sentence of the clause is taken together with the second paragraph of text, it would seem that determining the average weekly hours (over the previous six months) is for the purpose of determining what a “day” is for a part time employee - as set out in the first sentence of clause 68.5.1(b) - “Where a public holiday occurs on a day [my emphasis] a part-time employee is not rostered to work....”. The clause therefore provides for the entitlement to payment to be based on a part time employee’s “day”. The Example provided in the table seems to average the hours over a week rather than six months. The current formula in the table then determines what a “day” is by utilising an eight hour shift as the multiplier.
[44] However, part time employees under the 2004 and 2008 Medical Scientists et al Agreements have their hours determined on the basis of an agreed number of hours, days and the starting/finishing times, rather than with reference to shifts. Clause 19.2 of the 2008 Medical Scientists et al Agreement provides:
“19.2 At the time of engagement, the employer and the regular part-time employee will agree in writing on the following matters:
19.2.1 a regular pattern of work, specifying the hours worked each day:
19.2.2 which days of the week the employee will work; and
19.2.3 the actual starting and finishing times each day.”
[45] Therefore, in operationalising the text of the clause, in the context of medical scientists and others and not nurses, it would seem that a different method needs to be adopted in determining what a “day” constitutes for a part time medical scientist and others. According to the text of clause 68.5.1(b), the first step is to average the weekly hours of the employee over the previous six months. The formula in the table calculates this on the basis of a week rather than six months. The next step is to establish what a “day” is. This is achieved by averaging the number of days per week the employee worked over the previous six months. The “pro rating” is achieved by then dividing the average weekly hours by the average number of days worked per week. This then establishes what a “day” means for a part time medical scientist employee.
[46] In summary, clause 68.5.1(b) of the 2008 Medical Scientists et al Agreement, as it applies to those classifications covered by it, requires that a “day” be quantified for a part time employee. This is because the clause stipulates that a part time employee will be paid when a public holiday falls on a day that the employee is not rostered to work. Quantifying the “day” is achieved by averaging the weekly hours worked by the employee over the previous six months and dividing that by the average number of days worked per week for the same period. This results in the number of hours that constitute a “day” for each part time employee.
[47] It is clear that this clause was originally determined in the context of general nurses and not medical scientists and others and that it was replicated in the medical scientists Agreement without any alteration to accommodate the differences between the two agreements regarding how the hours of part time employees are determined.
[48] Customising the table in clause 68.5.1(b) of the 2008 Medical Scientists et al Agreement, for medical scientists and the other classifications, it will read as follows: To ascertain what a “day” means, the first column establishes the average number of hours worked per week. The second column establishes the average number of days worked per week. The third column “pro rates” the first two columns by dividing the average number of hours per week (column 1) by the average number of days worked per week (column 2). This creates the number of hours a “day” for the part time employee (Base Payment). This figure is then multiplied by the appropriate penalty.
[49] In diagrammatic form, the table is as set out below:
Average Weekly Hours | Average No. Of Days Per Week | Base Payment (Average Number of Hours per Day) | Penalty | Payment |
Total number of hours worked over previous 6 months DIVIDED BY 26 weeks = (A) | Total number of days worked over previous six months DIVIDED BY 26 weeks = (B) | A DIVIDED BY B = X hours | X hours multiplied by T 1.0 | = $ |
COMMISSIONER
1 Exhibit R1
2 Print N0175, 31 August 2000, Exhibit R1 at paragraph 4 and Transcript PN 111 - 113
3 Transcript PN 115 - 139
4 Ibid PN 146
5 Ibid PN 146 - 157
6 Ibid at PN 239 - 244
7 Ibid at PN 245 and Exhibit R1 at paragraph 14
8 Exhibit R1 at paragraph 12 and Transcript PN 210 - 221
9 Exhibit R1 at paragraph 13 and Transcript PN 223 - 232
10 Transcript PN 311 - 313
11 Ibid PN 365
12 Ibid PN 373
13 Ibid PN 373 - 375 and 385
14 Ibid PN 388 - 390
15 Ibid PN 397 - 403
16 Ibid PN 408 - 422
17 Ibid PN 439 and Exhibit A1 at paragraph 10
18 Ibid PN 440 and Ibid at paragraph 11
19 Ibid PN 440 - 441 and ibid at paragraphs 2 and 5
20 Exhibit A1
21 Transcript PN 460
22 Ibid PN 462 and Exhibit A1 at paragraph 7
23 Print T4894
24 Transcript PN 463 and Exhibit A1 at paragraph 7
25 Exhibit A1 at paragraph 7
26 Transcript PN 463
27 Ibid PN 464 - 465 and 469 - 470
28 Ibid PN 468
29 Ibid
30 Ibid PN 472 - 474
31 Ibid PN 473
32 Ibid PN 479
33 Ibid PN 491
34 Ibid PN 480
35 Ibid PN 480 - 486
36 Ibid PN 487
37 Ibid PN 493
38 Ibid and Exhibit A1 at paragraph 33
39 Ibid PN 488 - 489 and ibid at paragraphs 27 - 29
40 Transcript PN 494 - 495
41 Ibid PN 496
42 Ibid PN 496 - 508
43 Ibid PN 514
44 Print N0175
45 Print H0153
46 Ibid and Transcript PN 518
47 Transcript PN 518 - 519
48 Ibid PN 520 - 525
49 Ibid PN 531 - 532
50 AG824096 PR951246, 19 May 2003 and Transcript PN 525 - 526
51 Transcript PN 683 - 684 and Exhibit R4 at paragraph 11
52 Ibid PN 534 and ibid at paragraph 15
53 Ibid PN 537 - 538
54 Ibid PN 539
55 Ibid PN 540 - 543
56 Ibid PN 543 and 632 - 634
57 Ibid PN 635
58 Ibid PN 636 - 637
59 Ibid PN 544 and Exhibit R4 at paragraph 16
60 Transcript PN 686 - 696
61 Ibid PN 697
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