Jarrod Seen & Trevor McGuire v Eastern Australia Airlines Pty Limited t/a Qantaslink

Case •

[2021] FWCFB 6023

•

15 october 2021
[2021] FWCFB 6023

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.604 - Appeal of decisions

Jarrod Seen & Trevor McGuire

v

Eastern Australia Airlines Pty Limited t/a Qantaslink

(C2021/4161, C2021/4162)

VICE PRESIDENT HATCHER
deputy president gostencnik
commissioner yilmaz

SYDNEY, 15 october 2021

Appeals against decision [2021] FWC 3604 of Commissioner Cambridge at Sydney on 2 July 2021 in matter numbers C2020/6987 and C2020/7033.

  1. Jarrod Seen and Trevor McGuire (appellants) have each lodged appeals against a decision of Commissioner Cambridge issued on 2 July 2021[1] (decision) to dismiss applications made by the appellants for the Commission to deal with a dispute pursuant to the dispute resolution procedure in clause 10 of the Eastern Australia Airlines Pty Limited Pilots Enterprise Agreement 2015 (2015 Agreement) pursuant to s 739 of the Fair Work Act 2009 (FW Act). Before the Commissioner, the appellants characterised the dispute as requiring the resolution of three identified questions. The Commissioner determined that all three questions were beyond the jurisdiction of the Commission and dismissed the applications on that basis. The appeals challenge the conclusion that the questions (particularly the second question) were beyond the Commission’s jurisdiction under s 739.

  1. The background to the appeals is as follows. The appellants are employed as pilots by Eastern Australia Airlines Pty (Eastern). Eastern, together with Sunstate Airlines (Qld) Pty Limited (Sunstate), constitute the QantasLink regional airline business (QantasLink), and both companies trade as “QantasLink”. The appellants are covered by the 2015 Agreement and, before that, were covered by the Eastern Australia Airlines Pty Limited Pilots Enterprise Agreement 2010 (2010 Agreement) and the Eastern Australia Airlines Pty Limited Enterprise Agreement 2007 (2007 Agreement).

  1. Each of Eastern and Sunstate maintain separate seniority lists of the pilots employed by them. Seniority is measured by length of service, with the most senior pilot holding the number one position and the most junior pilot being the last on the list. Seniority is important in respect of a large range of employment entitlements, including (as the Commissioner observed), work allocation, promotions, retention or demotion, postings, temporary and permanent transfers, and allocation of annual leave.[2] Eastern’s seniority list is published on the business’ intranet and is accessible to its pilots, and is updated approximately every 4-6 weeks as pilots retire, leave or are recruited.

  1. In 2008, a decision was made to close Sunstate’s Canberra base and, in light of this, QantasLink management and the Australian Federation of Air Pilots (AFAP) entered into an agreement for pilots at the two companies to engage in temporary position swaps to mitigate the effects of the closure. Pursuant to this agreement, in early 2009, a Sunstate pilot, Yolanne Baker, temporarily swapped her position with that of an Eastern pilot, Rick Vella. Mr Vella had held a seniority position on the Eastern seniority list that was higher than that of either of the appellants (i.e. with a lower number), and as a consequence of the swap (and pursuant to the agreement with the AFAP) Ms Baker took Mr Vella’s position on the Eastern seniority list. This placed her above the appellants even though she had less service with Eastern than them.

  1. In 2011, the AFAP requested that the position swaps (including the swapped positions on the seniority lists) be made permanent. QantasLink agreed to this. The AFAP briefed its members about this (which included the appellants). Ms Baker was informed by QantasLink in a letter dated 2 June 2011 of this arrangement, including that she would permanently forfeit her position on the Sunstate seniority list and assume Mr Vella’s position on the Eastern seniority list.

  1. On 7 October 2015, the 2015 Agreement took effect. Clause 23 of the 2015 Agreement deals with pilot seniority, and relevantly provides:

23. Seniority

23.1.1. The Company shall publish no later than fourteen days after the commencement of this Agreement a seniority list of all pilots in its permanent employment. A number indicating relative length of service with the Company shall identify the seniority of each pilot on the list, the longest serving pilot having the number "one". A pilot once having established a seniority date shall not lose that date except by termination of employment as a pilot with the Company.

23.1.2. A pilot’s seniority shall be advised to him or her in writing on the day he/she commences employment as a pilot.

23.1.3. Pilots employed on the same date shall have their relative seniority positions decided by the Company in accordance with qualifications and experience.

23.1.4. Relative Seniority

a) Relative seniority of the Company's permanent pilots as indicated on the seniority list shall be the primary consideration of the Company in all matters concerning employment opportunities with the Company, including:

•  equipment assignments;

•  promotions;

•  retention or demotion in case of reduction of establishment;

•  postings, temporary and permanent transfer.

b) Should a situation arise in which observance of this clause 23.1.4 would not be expected to meet the needs of the Company and a solution cannot be agreed between the Company and a pilot, a conference shall be convened between the Federation and the Company or their representative to achieve a solution.

23.1.5. A pilot shall be permitted a period of fourteen days after any publication of the seniority list in which to protest to the Company on any omission or incorrect listing affecting his seniority, except that a pilot on leave or duty away from home base at the time of publication of such list shall have a period of fourteen days from date of his return to duty at his home base during which to file such protest. If dissatisfied with the Company's decision the pilot may have recourse to the grievance procedures in this agreement.
. . .

  1. In respect of the requirement in clause 23.1.1 for Eastern to publish a pilot seniority list within 14 days of the commencement of the 2015 Agreement (that is, by 21 October 2015), it appears that Eastern continued to maintain the seniority list on its intranet in this period but did not take any separate or additional step to publish the list.[3]

  1. On 28 August 2019, Mr McGuire sent a letter to the AFAP and QantasLink to raise a complaint pursuant to clause 23.1.5 of the 2015 Agreement. The essence of the complaint was that the seniority list did not comply with the requirements of clause 23.1.1 because of the position swap arrangement having been made permanent in 2011. Mr McGuire noted that Mr Vella had since retired and contended that, as a consequence, his position on the seniority list should have been removed (instead of continuing to be held by Ms Baker). Mr McGuire said that this had affected him personally, “particularly in respect to Annual Leave Bidding”. The AFAP declined to revisit the matter or agitate Mr McGuire’s complaint with QantasLink.

  1. By letter dated 23 March 2020, Mr Seen raised the same issue with the AFAP in the context that QantasLink was standing down pilots because of the COVID-19 pandemic, that the allocation of duties was being determined in seniority order and that if redundancies were required at a later stage, seniority would also apply. On 4 May 2020, Mr McGuire together with Mr Seen raised a complaint with QantasLink that the initial position swap arrangement in 2009 was contrary to the provisions of the 2007 Agreement. This was rejected by QantasLink in correspondence in response dated 26 May 2020. In its response, QantasLink said that it was “unfair and unreasonable” to seek to revisit the seniority arrangements determined more than 10 years before. It also stated:

“In my opinion you are not able to bring a dispute about decisions in relation to seniority. The 2007 Agreement (57.5) and the 2015 Agreement (23.1.5) provide a mechanism for dealing with disputes about seniority. Both are in almost identical terms and provide pilots with 14 days to protest an omission or incorrect listing affecting his or her seniority. If a pilot is dissatisfied with the Company's response the pilot has access to the dispute resolution provisions agreement.

In my view, the 14-day period is mandatory. After the 14 days have elapsed a pilot cannot protest his or her seniority and the list, in effect, at that time becomes fixed. There are very good policy reasons for this approach broadly set out at 1 above. It is simply not tenable for seniority disputes to be raised long after the event or events that gave rise to them. Protests must be made at the time (within 14 days of publication). On this basis, in my view, after the 14-day period following the publication of the relevant seniority list, either in December 2008 or early 2009 expired, pilots were prevented from protesting an omission or incorrect listing in relation to that seniority list.”

  1. QantasLink also contended in its reply that the Commission would not be able to arbitrate the dispute raised by Mr McGuire and Mr Seen because it arose under the 2007 Agreement, which ceased to operate on 28 July 2011 (when the 2010 Agreement took effect).

  1. After further attempts to agitate the issue with QantasLink were unsuccessful, Mr Seen and Mr McGuire both made applications to the Commission under s 739 of the FW Act for it to deal with the dispute pursuant to clause 10.1.3 of the 2015 Agreement. Clause 10.1.3 empowers the Commission to conciliate and, if necessary, “arbitrate or otherwise determine” matters in dispute. The applications filed by Mr Seen and Mr McGuire were in relevantly identical terms. Both applications identified the dispute as relating to clause 23.1.1, and contended that a seniority list had not been published in accordance with clause 23.1.1 on the following basis:

“[20] Clause 23.1.1 requires the company to identify the seniority of each pilot in its permanent employment in order of the longest serving pilot. Cpt McGuire and Cpt Seen have served with the company longer than Cpt Baker, however the Company has assigned Cpt Baker a higher seniority number on the list.”

  1. The applications identified three questions as requiring resolution:

“(1)As per section 52 of the FWA 2009, is Cpt Baker's current employment covered by the Eastern Australia Airlines Limited Pilots Enterprise Agreement 2015 or the Sunstate Airlines (Qld) Pty Limited Pilots Enterprise Agreement 2015?

(2)Has the Company contravened a term of the Eastern Australia Airlines Limited Pilots Enterprise Agreement 2015 by not publishing the seniority list in accordance with clause 23.1.1?

(3)Did the Company's actions cause adverse action by discriminating between the existing employees and the new employees [FWA 2009 s.342 item 1d] and by altering a group of employee’s (sic) position, including Cpt McGuire and Cpt Seen to their prejudice [FWA 2009 s.342 item 1c] by inserting new employees above them on the Eastern Australia Airlines pilot seniority list?”

  1. The dispute was not resolved by conciliation and Mr Seen and Mr McGuire requested that the Commission arbitrate the matter. Eastern raised four preliminary objections against the Commission proceeding to arbitrate the matter:

(1)The three questions posed for determination involved the exercise of judicial rather than arbitral power.

(2)The dispute did not arise under the 2015 Agreement. The actual controversy was the position swap arrangements which occurred in 2009 and 2011, and this could not be agitated under the 2015 Agreement.

(3)Even if the dispute could be raised under the 2015 Agreement, the capacity to raise the issue was subject to the 14-day time limit in clause 23.1.5. The publication of any seniority list during the currency of the 2015 Agreement did not involve any alteration to the respective positions of Mr Seen and Mr McGuire on the seniority list.

(4)Even if the Commission had the jurisdiction to arbitrate the matter, the Commission should exercise its jurisdiction not to do so. The time that had elapsed since the position swaps in 2009 and 2011 meant that the activation of the dispute now would have significant and unfair effects on Ms Baker, who had made career and life decisions over the past 10 years on the basis of her reliance on permanently obtaining her current seniority position with Eastern.

The decision

  1. The decision under appeal was concerned with the determination of the four preliminary objections to arbitration of the dispute raised by Eastern.

  1. In relation to the first preliminary objection, the Commissioner found that the determination of the first and third questions posed by the appellants would involve the exercise of judicial power and was thus beyond the jurisdiction of the Commission. However, in relation to the second question, the Commissioner said that, with “some slight alteration to the wording”, there would be a proper foundation for the Commission to make a determination as to the correct construction that is to be given to clause 23.1.1 of the 2015 Agreement.[4] The Commissioner described the second question as “going to the heart of the dispute”.[5]

  1. The Commissioner upheld the second preliminary objection on the basis of his characterisation of the dispute. He said:

“[66] However, the aspect of the seniority list which was contested by the applicants was the asserted error whereby Ms Baker has a seniority number that does not accord with what the applicants asserted to be the correct application of clause 23.1.1. The essence and gravamen of the dispute is the seniority number that has been assigned to Ms Baker. Importantly, Ms Baker did not obtain that seniority number during the currency of the 2015 EA, she obtained that seniority number initially on a temporary basis in 2009, and on a permanent basis in 2011.

[67] Consequently, when the matter that is in dispute is carefully examined and clearly identified it can be distilled to represent a contest as to whether Ms Baker has been assigned a seniority number in accordance with the relevant terms of the applicable industrial instrument. Ms Baker was assigned that seniority number at a time when the 2007 EA was in operation, and not when clause 23.1.1 of the 2015 EA was in operation. It is the assignment of the seniority number to Ms Baker not the perpetuation of that number in subsequent seniority lists, that is the subject matter of the dispute raised by the applications.

[68] The assignment of the seniority number to Ms Baker occurred during the operation of the 2007 EA and a dispute about that issue is not a dispute about a matter arising under the 2015 EA. The applications do not satisfy clause 10.1.1 of the DSP as they raise a dispute that is not about a matter arising under the 2015 EA.”

  1. The Commissioner also upheld the third preliminary objection on the following basis:

“[72] Clause 23 is a specific clause that deals with various issues regarding seniority of pilots and clause 23.1.5 establishes a specific regime for dealing with a dispute, (referred to as a “protest”), which involves an alleged omission or error in a seniority list. The subject matter of the dispute identified in the applications falls squarely within the envisaged operation of clause 23.1.5. The applicants’ dispute is about what they alleged to be the incorrect seniority number that has been assigned to Ms Baker. In instances where a dispute is raised which concerns pilot seniority, the general provisions of the DSP must surrender to the specific provisions of clause 23.1.5, generalia specialibus non derogant.

[73] Consequently, the applicants would need to satisfy the requirements of clause 23.1.5 before the matter in dispute could be properly dealt with under the DSP. The applicants’ dispute about the alleged incorrect seniority number assigned to Ms Baker could not comply with the requirements of clause 23.1.5 as neither of the applicants raised any protest within 14 days after the publication of the seniority list which affected their seniority. The relevant seniority list was that which was published in 2009 when Ms Baker was assigned the seniority number previously occupied by Mr Vella on the Eastern pilots seniority list. In fairness, the 2009 list involved a temporary arrangement, and it would have been understandable that no protest would have been made at that time because of the temporary nature of the position swaps. However, the 2011 permanent assignment of inter alia, the seniority number provided to Ms Baker, represented the relevant time at which activation of any protest was required for compliance with clause 23.1.5 or more accurately, the corresponding clause, clause 57.5 of the 2007 EA. The permanency that was declared for the position swaps in 2011 was widely disseminated amongst the Eastern pilot cohort, and the evidence has established that the applicants were aware of the permanency for the swap arrangements when that occurred in 2011 and they raised no protest at that time.”

  1. In dealing with the third preliminary objection, the Commissioner rejected the appellants’ submissions that clause 23.1.5 was not a permitted matter under s 172 of the FW Act.

  1. In relation to the fourth preliminary objection, the Commissioner said:

“[78] Ms Baker would be entitled to reject any proposition that might alter the seniority position that she has occupied for the past 10 years. If the jurisdiction of the Commission to hear and determine the applications was properly established, the requirements for the Commission to, when performing functions or exercising powers in relation to a matter arising under the Act, take into account equity, good conscience and the merits of the matter, would lead to a determination pursuant to 10.1.3 f) of the DSP whereby the Commission would determine not to provide further Hearing or subsequent determination of the applications. The applications would be determined in this fashion because the Commission has formed the view that if the applications were successful, an unconscionable injustice would be visited upon Ms Baker.”

  1. The Commissioner also said, in relation to the fourth preliminary objection, that “…notwithstanding any jurisdictional impediment, the Commission would refrain from further dealing with the applications and they would be dismissed accordingly” because of the “unconscionable injustice” that would be visited upon Ms Baker if the applications were successful.[6]

Appeal grounds and submissions

  1. The appellants’ notices of appeal were in relevantly identical terms, and they largely relied upon joint submissions in the appeals. The grounds of appeal are not readily identifiable since the appellants have attached a document in the nature of a submission to their notices of appeal in lieu of precisely stated grounds. The propositions stated in the document are broadly as follows:

(1)The Commissioner incorrectly characterised the dispute. The appellants’ initiating applications raised a dispute about compliance with clause 23.1.1 of the 2015 Agreement, which was a matter arising under the 2015 Agreement, and remains unresolved. While the circumstances of Ms Baker’s assignment of seniority are the causation of the matter, it is not itself the justiciable controversy. In the absence of a savings provision, the seniority lists under the 2007 Agreement and the 2010 Agreement did not survive the cessation of the operation of those agreements, and the dispute concerned the seniority list under the 2015 Agreement required to be established in accordance with clause 23.1.1.

(2)Judicial power would not be exercised in answering the questions posed for determination, since they were concerned with the future exercise of seniority rights.

(3)The Commissioner exercised judicial power by determining the assignment of past seniority rights and entitlements to Ms Baker.

(4)The conduct of the proceedings before the Commissioner was not fair or just, because: the Commissioner erred in granting permission for Eastern to be represented by lawyers under clause 10.1.9 of the 2015 Agreement instead of s 596 of the FW Act; the Commissioner did not consider the future rights and entitlements of the appellants and all other employees covered by the 2015 Agreement; and the Commissioner involved Ms Baker in the dispute and not the other pilots covered by the 2015 Agreement.

(5)The Commissioner did not follow the dispute procedure correctly, in that his interpretation of clause 23.1.5 results in the exclusion of employed pilots (but not the employer or an employee organisation), from being able to access the dispute resolution procedure in relation to seniority. The Commissioner erred in his interpretation of clause 23.1.5 as limiting the operation of the dispute settlement procedure or, alternatively, erred in finding that clause 23.1.5 was about a permitted matter. Additionally, it was not possible for the appellants to know when the 14 days ran from in respect of Ms Baker’s placement on the seniority list.

  1. The appellants contended in the same document that the grant of permission to appeal would be in the public interest because:

  • the decision incorrectly interpreted clause 23.1.5, in circumstances where provisions in similar terms exist in a number of other enterprise agreements applicable to pilots;
  • the decision did not consider the impact on the current and future seniority entitlements of all employees covered by the 2015 Agreement;
  • the issue of whether an enterprise agreement can restrict access to a dispute resolution procedure for matters arising under an agreement is an important issue for workers covered by enterprise agreements generally; and
  • the public confidence in the Commission to properly conduct its duties under the FW Act is affected by the Commissioner’s conclusion that he would refrain from dealing with an application where an unconscionable outcome may arise and could lead to a matter that arises under an agreement not being settled.

  1. The appellants’ submissions largely repeated, with some elaboration, the matters articulated in the document attached to their notices of appeal.

  1. Eastern submitted that:

  • the Commissioner’s characterisation of the dispute was clearly correct, given that the appellants’ applications raised the question of “how their position has been altered by a series of past decisions and acts conducted by the Company” and stated that “[t]he dispute raised focuses on an agreement the Company and AFAP entered into in 2008 to make temporary employee positions swaps available for employees…”;
  • the three questions posed for determination by the appellants were solely focused on Ms Baker’s employment with Eastern, her position on the Eastern seniority list and the position swaps which occurred in 2009 and 2011;
  • both the appellants confirmed in cross-examination that their “beef” with Eastern was the position swap decision in 2009 which was made permanent in 2011, and that the action was in breach of the 2007 Agreement;
  • the Commissioner was plainly correct that answering the first and third questions would involve the exercise of judicial power;
  • the Commissioner did not make findings about Ms Baker’s legal rights and entitlements, but rather characterised the dispute as concerning the assignment of a seniority number to Ms Baker at a time when the 2007 Agreement was in force;
  • it is plain that the Commissioner granted permission for Eastern to be legally represented pursuant to s 596 of the FW Act and, in any event, the appellants consented to such permission being granted;
  • questions of fairness to the appellants did not arise on the determination of the preliminary objections, except in respect of Ms Baker;
  • the appellants’ alleged inability to comply with clause 23.1.5 of the 2015 Agreement was not raised by them below and they cannot now rely upon it on appeal, nor in any event does it affect the construction of the provision or any finding made by the Commissioner;
  • the requirement in clause 23.1.5 does not apply to any published seniority list, but only one which (as the Commissioner found) affects the complainant’s seniority;
  • clause 23.1.5 certainly encompasses the raising of a dispute under clause 10 of the 2015 Agreement, and no such dispute was raised until 2019;
  • the rights of parties under a dispute resolution clause are a matter that is entirely for the parties to the agreement to agree upon and, in this case, clause 10 must be read together with clause 23.1.5; and
  • clause 23.1.5 is plainly a permitted matter under s 172 of the FW Act.

  1. Eastern submitted that permission to appeal should not be granted because the decision applied well-settled and orthodox principles of interpretation of industrial instruments, and no issue of broader application arises. Alternatively, it submitted, the appeals should be dismissed.

Consideration

Permission to appeal

  1. In respect of the five propositions raised by the appellants in their appeals set out in paragraph [21] above, we will grant permission to appeal with respect to propositions (1) and (5) because they raise significant questions about the proper construction of clauses 23.1.1 and 23.1.5 of the 2015 Agreement. Permission to appeal is refused in respect of the other three propositions because they raise no reasonably arguable contention of error.

Proper construction of clauses 23.1.1 and 23.1.5 of the 2015 Agreement

  1. Before we turn directly to the appellants’ contentions of error in relation to which we have granted permission to appeal, it is necessary to engage in the task of construing clauses 23.1.1 and 23.1.5.

  1. As to clause 23.1.1, we consider that it is unambiguous, and its meaning is plain. The first sentence establishes an obligation upon the “Company” (defined in clause 8.6 as meaning Eastern) to publish a seniority list of all pilots in its permanent employment. That obligation is required to be discharged no later than 14 days after the commencement of the 2015 Agreement (defined in clause 4 as being 7 days after the approval of the agreement by the Commission, such date being as a matter of fact 7 October 2015). The second sentence of clause 23.1.1 requires the list to rank pilots in order of seniority based on their length of service with Eastern, with the longest serving pilot having the number one position. The third sentence deals with the consequence of having seniority assigned by the list that Eastern is required to publish: a pilot retains that seniority position (described as a “date”, presumably being the date of commencement of employment with Eastern) until the termination of their employment as a pilot with Eastern.

  1. In the context of the dispute between the appellants, it is important to note two related matters. First, clause 23.1.1 establishes a purely prospective obligation that is not referable in any way at all to any seniority list that may have been in place before the 2015 Agreement commenced operation. Clause 23.1.1 does not preserve or “save” any seniority position acquired before the commencement of the 2015 Agreement (nor does any other part of clause 23 or any other provision of the agreement). Second, there is no exception established by clause 23.1.1 (or by any other provision of the 2015 Agreement) to the rule that a pilot’s place on the seniority list is determined by length of service with Eastern (noting that clause 23.1.3 creates a “tiebreaker” for employees with equal service). Thus, no accommodation is provided for the position swap arrangements agreed in 2009 and 2011 before the 2015 Agreement commenced operation, which resulted in the more junior Ms Baker (in terms of service with Eastern) being placed above Mr Seen and Mr McGuire.

  1. The requirement to “publish” a list, we consider, refers to the list being generally disseminated and made known to those affected by the list – that is, those covered by the 2015 Agreement, being Eastern itself, the AFAP (and the Australian and International Pilots’ Association) and the pilots employed by Eastern (clause 3). This is consistent with the ordinary meaning of “publish”. Placement of the list on Eastern’s intranet in a way accessible to these persons would appear to us to constitute publication for the purpose of clause 23.1.1.

  1. Clause 23.1.5 must be construed, we consider, in the context of the obligation to publish a seniority list imposed by clause 23.1.1. The first sentence of clause 23.1.5 establishes a right to make a “protest” to Eastern within 14 days “…after any publication of the seniority list…”, subject to the prescribed circumstance in which that period is to be extended. Because Eastern has adopted a practice of continually maintaining and updating (approximately every 4-6 weeks) a seniority list on its intranet, the appellants submitted that the reference to “any” publication is to be understood as referring to any modified seniority list placed on the intranet by Eastern at any time during the currency of the 2015 Agreement. This would mean, in effect, that pilots would have rolling 14-day opportunities to protest the seniority list every 4-6 weeks or so. We reject this. The only obligation to publish a seniority list for which the 2015 Agreement provides is that in clause 23.1.1. For this reason, we consider that clause 23.1.5 must be understood as referable to the publication of any seniority list published pursuant to clause 23.1.1. We note in this connection the use of the definite article in “the seniority list” in clause 23.1.5, which connotes a seniority list published on a single occasion.

  1. Eastern submitted, and the Commissioner appears to have accepted, that the reference in the first sentence to the “protest” having to be concerned with “any omission or incorrect listing affecting [the pilot’s] seniority” confines the operation of the right to protest to any change in the seniority list which changes the pilot’s seniority. This submission must also be rejected, since it seeks to construe clause 23.1.5 by reference other than to the seniority list required to be published under clause 23.1.1. We repeat that clause 23 only contemplates a seniority list being published on a single occasion, and that list must be published in accordance with the requirements of clause 23.1.1 and is not referable to anything which happened before the 2015 Agreement took effect. Accordingly, we consider that a protest about “any omission or incorrect listing affecting [the pilot’s] seniority” is to be understood as referring to anything in the seniority list published pursuant to clause 23.1.1 which, by error or omission, does not accord with the requirement of seniority based on service established by clause 23.1.1 and thereby affects the seniority of the protestant pilot compared to the position the pilot would hold if the requirement had been complied with.

  1. Accordingly, we construe clause 23.1.5 as requiring any protest concerning the seniority list published under clause 23.1.1 to be made with Eastern within 14 days of publication (subject to the extended period allowed when a pilot is on leave or duty away from home base at the time of publication). The second sentence of clause 23.1.5, which allows a pilot to have recourse to the “grievance procedures in this agreement” (which, it is not in contest, is to be read as a reference to the dispute resolution procedure in clause 10), is predicated on the pilot having made a protest in accordance with the first sentence of the clause and such a protest having been rejected by Eastern. The corollary of this, we consider, is that a dispute about the seniority list published pursuant to clause 23.1.1 can only be raised and pursued under clause 10 (including being arbitrated by the Commission) if the pilot makes the initial protest within the prescribed 14-day period.

  1. Our construction of clauses 23.1.1 and 23.1.5 is concordant with the structure and purpose of clause 23 as a whole. As clause 23.1.4 makes clear, a pilot’s placement on the seniority list is of primary importance to a range of matters affecting the pilot’s employment while the agreement is in operation. Clause 23.1.1 requires that the seniority list is to be established at the commencement of the 2015 Agreement within a period of 14 days. Clause 23.1.5 then provides a time-limited opportunity (again, 14 days) to protest the list so published, with resort to the dispute resolution procedure in clause 10 to resolve the matter if necessary. The last sentence of clause 23.1.1 confirms that relative seniority, once established pursuant to the clause, cannot thereafter change unless the pilot is terminated. Thus, the two provisions, read together, provide for the order of seniority which is to apply while the 2015 Agreement remains in effect to be settled to finality at the outset.

The characterisation of the dispute

  1. As earlier explained, the Commissioner upheld Eastern’s second preliminary objection on the basis of his characterisation of the dispute as essentially concerning the appellants’ disagreement with the assignment of Mr Vella’s seniority number to Ms Baker as a result of the position swap which occurred when the 2007 Agreement was in operation. We respectfully disagree with this conclusion. We think it is plain that the appellants’ dispute applications identified the key issue in the dispute as being whether Eastern had complied with clause 23.1.1. Their applications stated that the dispute related to clause 23.1.1 and squarely contended that Eastern had not complied with the requirement in the clause by ranking Ms Baker as higher in seniority than them. Their second question posed for determination, which the Commissioner found he had jurisdiction to arbitrate, was in direct terms concerned with whether clause 23.1.1 had been complied with. The dispute procedure in clause 10 applies, relevantly, to any “dispute arising in the workplace about matters arising under this Agreement…” (clause 10.1.1). A dispute about compliance with clause 10.1.1 of the 2015 Agreement is, on any view, a dispute about a matter arising under that agreement. That the dispute had its origins in factual circumstances which occurred while the 2007 Agreement was in operation did not rob it of its character as a dispute arising under the 2015 Agreement.[7]

Operation of the time limitation

  1. We agree with the conclusion reached by the Commissioner, in upholding the third preliminary objection, that he was not authorised to arbitrate the dispute by virtue of the time limitation in clause 23.1.5, albeit our reasons for that conclusion differ somewhat from his by reason of our construction of clauses 23.1.1 and 23.1.5. As earlier stated, it appears that Eastern had a seniority list placed on its intranet during the period of 14 days from the commencement of the 2015 Agreement (that is, 7 to 21 October 2015). We are prepared to accept that this constitutes publication of a seniority list for the purpose of clause 23.1.1, albeit that Eastern apparently did not take any separate, conscious step to comply with the provision. The appellants did not make any protest about this list within the required time, since it is not in dispute that they did not raise the matter until 2019. Accordingly, access to the dispute resolution procedure in clause 10 about their seniority complaint was no longer available at the time the appellants lodged their dispute applications and the Commission had no authority to arbitrate the applications. Clause 23.1.5 constitutes an effective limitation, in respect of the seniority list, on the powers conferred on the Commission to conciliate and arbitrate disputes, and s 739(3) and (5) of the FW Act oblige the Commission to comply with that limitation.

  1. For this reason, we consider that the Commissioner was correct in concluding that the 2015 Agreement did not authorise him to arbitrate the dispute raised by the appellants concerning compliance with clause 23.1.1.

  1. We reject the appellants’ submission that clause 23.1.5 is not a matter permitted to be included in an enterprise agreement under s 172(1) of the FW Act, since it clearly pertains to the relationship between Eastern and its employed pilots. Nor do we accept that the restriction placed by clause 23.1.5 on clause 10 means that clause 10 would not meet the approval condition for enterprise agreements in s 186(6)(a). We do not consider that a time limit on the capacity to access a dispute resolution procedure in an agreement is impermissible under s 186(6)(a) if it affords an employee a realistic opportunity to have a dispute about a matter arising under an agreement resolved by the Commission.

Other matters

  1. As earlier stated, notwithstanding that the Commissioner found that he was not empowered to arbitrate the dispute, he went on to say that even if he was, he would not exercise his discretion to arbitrate because to do so might result in an unconscionable outcome being visited upon Ms Baker. The Commissioner did not explain why he considered that, under clause 10, he would have the discretion not to further deal with a matter which he otherwise had power to arbitrate. Clause 10.1.3 of the 2015 Agreement relevantly provides:

10.1.3. If a dispute is referred to FWC for resolution, FWC can take any or all of the following actions as it considers appropriate to resolve the dispute:

…

f) where the matter, or matters, in dispute cannot be resolved (including by conciliation) and either party requests, arbitrate or otherwise determine the matter, or matters, in dispute.

  1. We consider that, to the extent clause 10.1.3 confers a discretion as to the actions to be taken by the Commission (including arbitration) in relation to a dispute, that discretion must be exercised for the purpose of resolving the dispute. The discretion cannot be utilised to avoid resolving a dispute because the outcome which may pertain from applying the provisions of the agreement may be unpalatable. We can readily understand the Commissioner’s position that the outcome sought by the appellants would, if obtained through arbitration, render an injustice to Ms Baker. However, the Commission’s duty under clause 10.1.3 of the 2015 Agreement is to use the identified powers to resolve disputes that are properly before it and, to the extent that this requires the making of a decision, the Commission is obliged by s 739(5) of the FW Act not to make a decision which is inconsistent with that agreement.

Conclusion

  1. We order that:

(1)Permission to appeal is granted in each appeal to the extent identified in paragraph [26] above.

(2)       The appeals are, to the extent of the grant of permission, dismissed.


VICE PRESIDENT

Appearances:

J Seen on his own behalf.
T McGuire on his own behalf.
V Bulut of Counsel on behalf of the respondent.

Hearing details:

2021.
By video-link (Sydney and Melbourne):
13 September.

<PR734838>


[1] [2021] FWC 3604

[2] Ibid at [8]

[3] Appeal hearing transcript, 13 September 2021, PNs 25-26, 468-472, 537-543, 559-564, 621-646

[4] [2021] FWC 3604 at [57], [61]

[5] Ibid at [58]

[6] Ibid at [84]

[7] Police Federation of Australia (Victoria Police Branch) v Victoria Police[2021] FWCFB 4161 at [34]

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