Jeffrey Swinson v Virgin Tech Pty Ltd T/A Virgin Tech

[2022] FWC 17

[2022] FWC 17

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.739 - Application to deal with a dispute

Jeffrey Swinson
v

Virgin Tech Pty Ltd T/A Virgin Tech

(C2021/4101)

COMMISSIONER CAMBRIDGE SYDNEY, 7 JANUARY 2022

Dispute settlement procedure - dispute about interpretation of clause providing for preference for appointment to promoted position - further contest regarding clause requiring fair treatment during dispute resolution process - interpretation made - application dismissed.

[1]       This matter involves an application made under section 739 of the Fair Work Act 2009 (the Act) for the Fair Work Commission (the Commission) to deal with a dispute in accordance with a Dispute Settlement Procedure (DSP). The application was made by Jeffrey Swinson (the applicant), and the respondent employer is Virgin Tech Pty Ltd T/A Virgin Tech (Virgin or the employer). The DSP upon which the application has been made is found at clause 11 of the Virgin Tech Enterprise Agreement 2020 (the 2020 EA).

[2]       The application was filed on 18 July 2021, and the subject matter of the dispute was previously raised in an earlier application taken under s. 739 of the Act and made in respect to the Virgin Tech Enterprise Agreement 2017 (the 2017 EA). The 2017 EA was terminated and replaced by the 2020 EA on 12 February 2021. The dispute has been the subject of extensive unsuccessful conciliation proceedings held in respect to the earlier application. On 18 August 2021, the Commission conducted a Mention and Directions proceeding during which the matter was listed for Hearing on 4 November 2021, and Directions were issued for the Parties to file and serve evidence and submissions in advance of the scheduled Hearing.

[3]       The Commission subsequently assisted the Parties to reach agreement upon the wording of two questions for determination which would be the subject matter for the Hearing on 4 November 2021. On 3 November 2021, the Commission issued a Decision [2021] FWC 6256 which refused permission that had been sought by Virgin pursuant to s. 596 of the Act, to be represented by lawyers or paid agents. 

[4]       At the Hearing held on 4 November 2021, the applicant appeared in person on his own behalf and Ms L Khan appeared by video-link for Virgin. The applicant provided evidence as a witness and he was cross-examined by Ms Khan. Virgin introduced evidence from only one witness, Mr J Vandenheuvel who holds the position of Head of Aircraft Maintenance and Ramp Services, and he gave his evidence via video-link and he was cross-examined by the applicant.

[5]       The applicant made oral submissions in addition to written outline of submissions and reply submissions documents that were respectively dated 16 September and 28 October 2021. Ms Khan provided oral submissions on behalf of Virgin in elaboration of documentary material that had been filed on 15 October 2021.

Background

[6]       There was little factual contest between the Parties about the circumstances which gave rise to the dispute in this matter. The dispute arose from a decision taken by Virgin management to select a person other than the applicant to fill an internal job vacancy that was advertised in June 2019.

[7]       The applicant had applied for the internally advertised position, and he raised a grievance whereby he asserted that the appointment by Virgin of the successful candidate was made contrary to the provisions of subclause 47.2 of the 2017 EA. The contested appointment to fill the vacant position has arisen from the words contained in subclause 47.2 of the 2017 EA which reads as follows:

“47.2   Virgin Tech will provide preference to Team Members currently employed at classification AME 4A or LAME A, part-time LAME or permanent night shift LAME roles (where appropriately qualified) to fill vacancies for higher LAME classifications, subject to the following:

(a)The Team Member not being subject to performance management (including outstanding disciplinary action);

(b)Contractors may only be utilised where there are insufficient AMEs seeking to act up in LAME roles, the relevant AMEs do not have the qualifications or skill set required to perform the work, or the AMEs are based outside of the port where the role is located.

(c)Where a vacancy exists for a permanent LAME role, Virgin Tech will advertise the position internally.

(d)Upon receipt of all applications and if at least one appropriate application is received, the role shall be filled by either;

(i)A LAME from another Port; or

(ii)The applicant within the Port where the vacancy exists who has served the longest time employed as either a part-time LAME, LAME A, AME 4A or permanent night shift LAME and is the correct trade (B1 or B2).

(e)Should two applicants hold the same start date for preferential employment under this clause, priority will be given to the Team Member with the longest time of service with Virgin Tech. If the candidates are still equal, the decision for employment will be at Virgin Tech’s discretion.”

[8]       The focus of the dispute has involved the applicant’s grievance that arose from the successful candidate who was appointed to the vacant position in August 2019, not being currently employed at classification AME 4A or LAME A, part-time LAME or permanent night shift LAME roles. The applicant who was (and remains) employed at the classification AME 4A was not successful, and he has asserted that the appointment of someone not currently employed at classification AME 4A or LAME A, part-time LAME or permanent night shift LAME roles, contravened subclause 47.2 of the 2017 EA.

[9]       There was also a secondary aspect of the dispute in this instance whereby the applicant asserted that Virgin had failed to comply with the Fair Treatment and Dispute Resolution Process requirements of the terms of subclauses 11.1 and 11.6 (a) of the 2017 EA, when it dealt with his grievance concerning the disputed appointment to the vacant position filled in August 2019 (the disputed appointment). This aspect of the dispute was essentially based upon the applicant’s contention that Virgin had not provided him with a fair, equitable, quick, and effective response to his grievance concerning the disputed appointment. The secondary aspect of the dispute (the fair treatment dispute), asserted that Virgin had failed to provide the applicant fair treatment, and this assertion was based upon the terms contained in subclauses 11.1 and 11.6 (a) of the 2017 EA which read as follows:

“11. FAIR TREATMENT AND DISPUTE RESOLUTION PROCESS

11.1 Virgin Tech is committed to providing a fair and equitable workplace, and ensuring concerns within the workplace are resolved as quickly and effectively as possible.

…

11.6 During the Fair Treatment and Dispute Resolution Process outlined above, a Team Member has the right to:

(a) be treated fairly; …”

[10]     In order to properly appreciate the applicant’s grievance concerning the disputed appointment, it is necessary to understand the well-established hierarchy of classifications that broadly apply in the Australian aviation maintenance industry and which are relevantly stipulated in inter alia, clause 35 of the 2017 EA. The classification hierarchy is structured with various levels of two primary classifications which start with levels of Aircraft Maintenance Engineer (AME) and advances to levels of Licensed Aircraft Maintenance Engineer (LAME). In this instance there are 5 levels of AME classifications, the lowest being AME 1 and the highest being AME 4A, and there are 4 levels of LAME classifications, the lowest being LAME A and the highest being LAME B Grade 3.

[11]     The means by which any individual might progress through the classification structure and theoretically advance from the lowest paid classification of AME 1 to the highest paid classification of LAME B Grade 3, is subject to a variety of skill, competencies, licencing, and other accreditations together with certain selection processes and staffing criteria. At the lower levels of AME classifications there is, in clause 35.14 of the 2017 EA, an anticipated “automatic” progression from AME 1 to AME 3 within the first year of employment. Clause 35.15 of the 2017 EA introduces more discretionary aspects for the progression from AME 3 to AME 4, and clause 35.8 relevantly stipulates, “Appointment to AME 4A will be by selection only.” There are also various other stipulated requirements that apply for promotion through the LAME classifications which are not relevant to the applicant’s circumstances.

[12]     The applicant commenced employment with Virgin in March 2015 in the classification of AME 1. The applicant was engaged on a part-time basis. The applicant progressed through the lower AME classifications (2, 3 and 4) and in September 2018 he was promoted to the AME 4A classification. In the AME 4A classification the applicant would from time to time, perform the role of the higher LAME B Grade 1 classification.

[13]     In June 2019, the applicant responded to an internal job vacancy advertisement for a part-time LAME B Grade 1 role. The applicant had the identified accreditations for the advertised role, and as a current AME 4A, he was surprised when in August 2019, he was advised that he had been unsuccessful with his application for promotion and instead the vacancy had been filled by an individual who was at a lower AME 2 or 3 classification.

[14]     In August and September 2019, the applicant engaged in discussions with his relevant managers during which he took issue with the promotion of a lower classified AME to the LAME role. The applicant was greatly disappointed at what he described to be the “leapfrogging” of a lower AME over himself, and which, from the applicant’s perspective, involved a promotion that was inconsistent with both the past practice of Virgin and the requirements of subclause 47.2 of the 2017 EA.

[15]     Although the applicant was dissatisfied with the responses that he received from his relevant managers at that time, circa August 2019, he was performing the role of the higher LAME B Grade 1 classification for about 40% of his working time. Consequently, the financial impact of being unsuccessful with the promotion to the LAME role was, to some extent, mitigated by the applicant’s regular performance of higher duties. However, the subsequent impacts of the COVID-19 pandemic dramatically reduced the incidence of the applicant’s performance of any higher duties and the long-term prospects for further promotional opportunities for the applicant. Consequently, in September 2020, the applicant activated a grievance process regarding the “leapfrogging” promotion that had occurred in August 2019.

[16]     On 29 September 2020, the applicant commenced an email exchange with his relevant manager about his grievance regarding the “leapfrogging” promotion of August 2019. The subsequent communications and discussions with the applicant’s relevant manager did not resolve his grievance, and in October 2020, the applicant engaged in a further email exchange with Virgin’s human resources department.

[17]     Following an earlier exchange of emails between the applicant and a “People Advisor” from Virgin’s human resources department, on 26 November 2020, the applicant requested a response from the relevant human resources representative who was dealing with his grievance. The relevant representative sent an email response on the following day, 27 November 2020, which unfortunately, was, for some explained reason, not received by the applicant. Consequently, it appeared to the applicant that his grievance regarding the “leapfrogging” promotion of August 2019, had ultimately, been ignored by Virgin’s human resources department.

[18]     On 19 January 2021, the applicant sent a letter to Virgin’s Head of Aircraft Maintenance and Services, Mr Vandenheuvel, which advised of the applicant’s ongoing and unresolved workplace grievance regarding the “leapfrogging” promotion of August 2019, and which was asserted to have involved a breach of clause 47.2 of the 2017 EA. The letter further complained that the applicant’s concerns had been unanswered and that he had found the responses that had been provided by Virgin to be dismissive and patronising.

[19]     On 27 January 2021, the applicant filed a Form F10 (the first dispute notification) seeking that the Commission deal with a dispute in accordance with a DSP contained in the 2017 EA. Later that day, 27 January, Mr Vandenheuvel provided an email response to the applicant which relevantly stated inter alia, “The clause in the EA you reference is related to “Progression to Full Time LAME Employment” and does not relate to PT LAME positions.”

[20]     The first dispute notification was the subject of various unsuccessful conciliation proceedings before the Commission. The 2017 EA was terminated and replaced by the 2020 EA on 12 February 2021. The applicant subsequently re-agitated his grievance regarding the “leapfrogging” promotion of August 2019, under the DSP contained in the 2020 EA, and his unresolved grievance subsequently resulted in the filing of a second Form F10 (the second dispute notification).

[21]     The second dispute notification, which is the application that initiated these proceedings, essentially reactivated the applicant’s unresolved grievance that was initially commenced under the DSP in the 2017 EA, and subsequently the Commission assisted the Parties to reach agreement on the wording of questions for arbitrated determination which are as follows:

1.Was Virgin Tech required to apply the provisions of subclause 47.2 of the Virgin Tech Enterprise Agreement 2017 (2017 EA) in respect to its determination of the successful individual appointed to the internal job vacancy advertised in June 2019 and for which the applicant was not successful?

2.Has Virgin Tech complied with any requirements that arise from the terms of subclauses 11.1 and 11.6 (a) of the 2017 EA in respect to its conduct associated with dealing with the grievance of the applicant raised following his unsuccessful application to be appointed to the internal job vacancy advertised in June 2019?

The Case for the Applicant

[22]     The applicant made oral submissions in addition to his written outline of submissions dated 16 September 2021, and his written reply submissions dated 28 October 2021.

[23]     The submissions made by the applicant strongly asserted that the promotion decision made by his then manager, Mr McDermott, in August 2019, breached the terms of the 2017 EA. The applicant also submitted that the promotion decision that was made by Mr McDermott in August 2019, was contrary to the past practice that Virgin had adopted over many years, and this departure from established practice confirmed to the applicant that the promotion decision was wrong and contrary to the 2017 EA.

[24]     The applicant also submitted that if the terms of subclause 47.2 of the 2017 EA operated as Virgin had asserted, that is, it only applied to appointments to full-time as opposed to part-time LAME roles, then part-time employees would be subject to indirect discrimination in career advancement. In support of this submission, the applicant referred to what he described as his fictional story about two hypothetical Virgin employees named Jack and Tony and a scenario involving two LAME vacancies, one a full-time position and the other a part-time position, for which the preference in promotion provisions of subclause 47.2 would only operate in respect to the full-time position. Consequently, the applicant asserted that if subclause 47.2 of the 2017 EA operated only for appointment to full-time LAME positions it would indirectly discriminate against part-time employees who often worked part-time because of parental or caring responsibilities.

[25]     The outline of submissions made by the applicant asserted that the promotional preference arrangements contained in subclause 47.2 of the 2017 EA applied to both full-time and part-time LAME positions. In support of this proposition the applicant referred to subclause 5.1 of the 2017 EA which inter alia stated “This Agreement contains the complete statement of mutual rights and obligations as between Virgin Tech and the Team Members…” Consequently, the applicant submitted that as the 2017 EA was silent in respect to any specification for promotional preference arrangements specifically for part-time LAME positions by implication, subclause 5.1 meant that it applied to both full-time and part-time LAME positions.

[26]     The applicant further submitted that he had observed that promotion to part-time LAME positions had occurred from the AME 4A classification, and that the “leapfrogging” that occurred in August 2019, was inconsistent with the past practice of Virgin. Further, the applicant noted that there were various other provisions in the 2017 EA which stipulated the progressive promotion in respect of 5 other classification promotions. In addition, the applicant submitted that the weekly number of hours worked by part-time and full-time LAMEs was not significantly different, and therefore it was appropriate, fair, and predictable for a progression pathway that would apply for both full-time and part-time LAME roles.

[27]     In further submissions, the applicant challenged the interpretation that Virgin sought to rely upon in respect to the title to clause 47 which was “PROGRESSION TO FULL TIME LAME EMPLOYMENT” together with the terms contained in subclause 12.9 of the 2017 EA which relevantly stated, “Where vacancies for full-time LAME positions become available, these will be filled in accordance with clause 46.1”. (It was accepted that the reference to clause 46.1 in this subclause should have been to clause 47.1). The applicant referred to the Macquarie dictionary definition of the word “progression” and he submitted that when considered in conjunction with subclause 12.9 of the 2017 EA, subclause 47.2 should be read as a standalone provision, and therefore reference to full-time LAME positions mentioned in subclause 12.9 referred to subclause 47.1, and the remainder of the clause, in particular subclause 47.2, was not confined in operation to only full-time LAME positions.

[28]     The applicant also made submissions regarding the introduction of subclause 47.1 which occurred when the 2017 EA replaced the Virgin Tech Enterprise Agreement 2014 (the 2014 EA). The applicant noted that the comparison documentation that was provided to employees during the agreement bargaining process for the 2017 EA, failed to mention the inclusion of the new subclause 47.1. Consequently, the applicant submitted that if the introduction of subclause 47.1 was taken to confirm that the entire clause had operation only for appointment to full-time LAME positions, it would have represented a disadvantage to the employees and therefore should have been included in the comparison document.

[29]     The submissions made by the applicant also addressed the second question for determination regarding the fair treatment in dispute resolution process and Virgin’s conduct when it dealt with the applicant’s grievance arising from the “leapfrogging” promotion of August 2019. In this regard, the applicant submitted that the dispute had been going on for over two years and that he felt that over an extended period of time his complaint had been dismissed, ignored, “ripped-off,” and possibly even lied to by management. The applicant submitted that he had not been provided with a fair and equitable process that ensured that his concerns were resolved as quickly and effectively as possible.

[30]     In summary, the applicant submitted that Virgin was required to apply subclause 47.2 of the 2017 EA when it appointed a person to the internal part-time LAME position advertised in June 2019. Therefore, the applicant submitted that the Commission should answer the first question for determination in the affirmative. In respect to the second question for determination, the applicant submitted that Virgin had failed to provide a fair treatment process when dealing with the applicant’s grievance arising from the “leapfrogging” promotion of August 2019.  Therefore, the applicant submitted that the Commission should provide an answer to the second question for determination in the negative.

The Case for Virgin

[31]     Ms Khan, Virgin’s senior legal counsel, made oral submissions in amplification of written submissions that were filed on 15 October 2021.

[32]     The submissions made by Ms Khan firstly stressed that Virgin made no criticism of the applicant for bringing the dispute forward and advancing it to an arbitrated outcome, and further it understood the applicant’s sense of frustration which underpinned his grievances.

[33]     Ms Khan referred to paragraphs 28 and 29 of the outline of submissions document that had been provided by Virgin, and she emphasised the assertion that clause 47 of the 2017 EA clearly referred to processes that are confined to full-time LAME employment. Ms Khan submitted that subclause 47.1 could not be read as a discrete and isolated provision and that the natural reading of the subclause referred to the whole of clause 47. The heading of the clause similarly referred to full-time LAME employment and according to the submissions made by Virgin, it was impossible to read subclause 47.2 as an isolated provision which would, contrary to the heading of the clause and the expressed terms in subclause 47.1, have application for the filling of part-time LAME positions.

[34]     Ms Khan also made submissions which addressed the second question for determination concerning whether the applicant had been provided with a fair treatment process when Virgin dealt with his workplace grievance arising from the contested promotion to a part-time LAME position that was internally advertised in June 2019. Ms Khan submitted that although the applicant had asserted that the dispute had been going for a period of two years, over a year has elapsed between when he first raised his concerns in 2019, and before he re-raised the issue in September 2020.

[35]     The further submissions of Ms Khan belatedly introduced what she described as an “additional point of jurisdiction” regarding the fact that the 2017 EA had been terminated and replaced by the 2020 EA. Unfortunately for Ms Khan, she had not been involved in the earlier proceedings during which the Parties had acknowledged the jurisdictional difficulties that may potentially arise in circumstances where a dispute was activated under a DSP in an enterprise agreement which is subsequently terminated. The Parties had come to an understanding that to avoid these potential jurisdictional difficulties the applicant would file the second dispute notification. Consequently, it was surprising for this submission regarding jurisdiction to have been made.

[36]     Ms Khan made further submissions which addressed the issue that the applicant had more recently raised regarding alleged indirect discrimination that would occur if subclause 47.2 of the 2017 EA was confined in its operation to part-time LAME positions. Ms Khan rejected the applicant’s assertion that some form of unlawful discrimination could occur because none of the protected attributes, for example, sex, age, race, et cetera, applied in respect to the actual circumstances of the applicant, or the theoretical scenario that he had sought to rely upon on the issue of alleged discrimination. In any event, Ms Khan submitted that any asserted discriminatory provisions were a matter relevant to the approval, rather than the interpretation of an enterprise agreement.

[37]     In conclusion, the submissions made by Ms Khan stressed that the applicant had not clearly articulated an outcome that he was seeking from the proceedings, and that the appointment to the part-time LAME position had occurred over two years ago. Ms Khan stated that it was not clear what the applicant was actually seeking as an arbitrated outcome. The submissions made by Virgin sought that the application be dismissed.

Consideration

[38]     The dispute in this instance has arisen from the decision of Virgin management to select a person other than the applicant to fill an internal job vacancy that was advertised in June 2019. The application is based upon the contention that Virgin was required to follow a selection process embodied in the terms of subclause 47.2 of the 2017 EA when it selected an individual to fill the vacant part-time LAME position that was advertised in June 2019.

[39]     The resolution of the dispute has required the Commission to firstly, provide for the correct construction to be given to the terms of subclause 47.2 and secondly, determine whether the applicant’s grievance was dealt with by Virgin in compliance with the fair treatment processes and associated requirements that are embodied in the terms of subclauses 11.1 and 11.6 (a) of the 2017 EA. The Commission is empowered to determine the dispute about the correct construction to be given to subclauses 47.2, 11.1 and 11.6 (a) of the 2017 EA by virtue of the Dispute Settlement Procedure (DSP) found at clause 11 of the 2020 EA which is in the following terms:

“11. FAIR TREATMENT AND DISPUTE RESOLUTION PROCESS

11.1 Virgin Tech is committed to providing a fair and equitable workplace, and ensuring concerns within the workplace are resolved as quickly and effectively as possible.

11.2 The procedure outlined in this clause should be followed to prevent and settle disputes and grievances concerning the National Employment Standards (“NES”) and the application of this Agreement.

11.3 If a Team Member has a concern, the Team Member should try to resolve it in the following manner:

(a)Try and resolve it with the Team Member’s respective Leader in the first instance. The Team Member’s Leader will consider the matter and respond as soon as reasonably practicable in the circumstances.

(b)If the Team Member cannot resolve the matter with his or her Leader, the Team Member may refer it to their relevant Manager Aircraft Maintenance for review.

(c)If the matter remains unresolved the Team Member may refer it to the Accountable Manager Virgin Tech, General Manager People, or their representative, for review.

11.4 If the matter is unable to be resolved at the workplace and all steps in this process have been taken, a Party to the dispute may refer the matter to the Fair Work Commission.

11.5     The Fair Work Commission may deal with the dispute in two stages:

(a)the Fair Work Commission will first attempt to resolve the dispute as it considers appropriate, including mediation, conciliation, expressing an opinion or making a recommendation; and

(b)if the Fair Work Commission is unable to resolve the dispute at the first stage, the Fair Work Commission may then:

(i)arbitrate the dispute; and

(ii)make a determination that is binding on the Parties.

11.6 During the Fair Treatment and Dispute Resolution Process outlined above, a Team Member has the right to:

(a)be treated fairly;

(b)seek advice from a member of Virgin Tech’s People Department; and

(c)be represented by a person or organisation of the Team Member’s choice.

11.7 If a Team Member has raised a concern via the Fair Treatment and Dispute Resolution Process, whilst it is being resolved, the Team Member must continue to work in accordance with the Team Member’s contract of employment unless there is reasonable concern about an imminent risk to the Team Member’s health or safety.

11.8     The status quo will remain until the matter is resolved.

11.9 The Parties to the dispute and their representatives must act in good faith in relation to the dispute.

11.10 The Team Member must also comply with any reasonable direction given by Virgin Tech.

11.11 Where the dispute is related to a change which has been proposed via the Consultation clause, the Parties agree that the Fair Treatment and Disputes Resolution Process can deal with both the process of consultation and the substance of the change.

11.12 The Parties to the dispute agree to be bound by the decision made by Fair Work Commission.”

[40]     Notwithstanding the submissions made by Ms Khan during the Hearing, the Parties agreed that the relevant procedural steps contained in the DSP had been followed. Therefore, the jurisdiction of the Commission to exercise the powers of private arbitration contained in the DSP was properly established. It should be noted that although the Commission is providing an arbitral outcome that involves an analysis of terms of the 2017 EA (because the relevant events occurred during the period that the 2017 EA was in operation), the relevant provisions under examination appear in identical terms in the 2020 EA which contains the DSP upon which the application under s. 739 of the Act was taken.

[41]     The Parties have also confirmed that the determination of the dispute involved an analysis of the words appearing in subclauses 47.2, 11.1, and 11.6 (a) of the 2017 EA so as to provide the correct construction or interpretation that should be given to those terms. The first and primary construction contest was whether the preferential selection process evident in the terms of subclause 47.2 should be interpreted to apply only to full-time LAME positions as opposed to part-time LAME positions.

[42]     The Parties have agreed on the wording of the two questions proposed for determination of the dispute, and for convenience these questions are repeated as follows:

1.Was Virgin Tech required to apply the provisions of subclause 47.2 of the Virgin Tech Enterprise Agreement 2017 (2017 EA) in respect to its determination of the successful individual appointed to the internal job vacancy advertised in June 2019 and for which the applicant was not successful?

2.Has Virgin Tech complied with any requirements that arise from the terms of subclauses 11.1 and 11.6 (a) of the 2017 EA in respect to its conduct associated with dealing with the grievance of the applicant raised following his unsuccessful application to be appointed to the internal job vacancy advertised in June 2019?

[43]      The task for the Commission to provide answers to the questions proposed for determination, has involved a reasonably straightforward contested construction determination. Any determination of a contested construction question should appropriately attract, with necessary modification, the application of the principles relevant to the task of construing the terms of an enterprise agreement. Those principles are conveniently set out at paragraph [114] of the Full Bench Decision in AMWU v Berri [1] (the Berri principles) and are in the following terms:

“1. The construction of an enterprise agreement, like that of a statute or contract, begins with a consideration of the ordinary meaning of the relevant words. The resolution of a disputed construction of an agreement will turn on the language of the agreement having regard to its context and purpose. Context might appear from:

(i) the text of the agreement viewed as a whole;
(ii) the disputed provision’s place and arrangement in the agreement;
(iii) the legislative context under which the agreement was made and in which it operates.

2. The task of interpreting an agreement does not involve rewriting the agreement to achieve what might be regarded as a fair or just outcome. The task is always one of interpreting the agreement produced by parties.

3. The common intention of the parties is sought to be identified objectively, that is by reference to that which a reasonable person would understand by the language the parties have used to express their agreement, without regard to the subjective intentions or expectations of the parties.

4. The fact that the instrument being construed is an enterprise agreement made pursuant to Part 2-4 of the FW Act is itself an important contextual consideration. It may be inferred that such agreements are intended to establish binding obligations.

5. The FW Act does not speak in terms of the ‘parties’ to enterprise agreements made pursuant to Part 2-4 agreements, rather it refers to the persons and organisations who are ‘covered by’ such agreements. Relevantly s.172(2)(a) provides that an employer may make an enterprise agreement ‘with the employees who are employed at the time the agreement is made and who will be covered by the agreement’. Section 182(1) provides that an agreement is ‘made’ if the employees to be covered by the agreement ‘have been asked to approve the agreement and a majority of those employees who cast a valid vote approve the agreement’. This is so because an enterprise agreement is ‘made’ when a majority of the employees asked to approve the agreement cast a valid vote to approve the agreement.

6. Enterprise agreements are not instruments to which the Acts Interpretation Act 1901 (Cth) applies, however the modes of textual analysis developed in the general law may assist in the interpretation of enterprise agreements. An overly technical approach to interpretation should be avoided and consequently some general principles of statutory construction may have less force in the context of construing an enterprise agreement.

7. In construing an enterprise agreement it is first necessary to determine whether an agreement has a plain meaning or it is ambiguous or susceptible of more than one meaning.

8. Regard may be had to evidence of surrounding circumstances to assist in determining whether an ambiguity exists.

9. If the agreement has a plain meaning, evidence of the surrounding circumstances will not be admitted to contradict the plain language of the agreement.

10. If the language of the agreement is ambiguous or susceptible of more than one meaning then evidence of the surrounding circumstance will be admissible to aide the interpretation of the agreement.

11. The admissibility of evidence of the surrounding circumstances is limited to evidence tending to establish objective background facts which were known to both parties which inform and the subject matter of the agreement. Evidence of such objective facts is to be distinguished from evidence of the subjective intentions of the parties, such as statements and actions of the parties which are reflective of their actual intentions and expectations.

12. Evidence of objective background facts will include:

(i) evidence of prior negotiations to the extent that the negotiations tend to establish objective background facts known to all parties and the subject matter of the agreement;
(ii) notorious facts of which knowledge is to be presumed; and
(iii) evidence of matters in common contemplation and constituting a common assumption.

13. The diversity of interests involved in the negotiation and making of enterprise agreements (see point 4 above) warrants the adoption of a cautious approach to the admission and reliance upon the evidence of prior negotiations and the positions advanced during the negotiation process. Evidence as to what the employees covered by the agreement were told (either during the course of the negotiations or pursuant to s.180(5) of the FW Act) may be of more assistance than evidence of the bargaining positions taken by the employer or a bargaining representative during the negotiation of the agreement.

14. Admissible extrinsic material may be used to aid the interpretation of a provision in an enterprise agreement with a disputed meaning, but it cannot be used to disregard or rewrite the provision in order to give effect to an externally derived conception of what the parties’ intention or purpose was.

15. In the industrial context it has been accepted that, in some circumstances, subsequent conduct may be relevant to the interpretation of an industrial instrument. But such post-agreement conduct must be such as to show that there has been a meeting of minds, a consensus. Post-agreement conduct which amounts to little more than the absence of a complaint or common inadvertence is insufficient to establish a common understanding.”

Plain and Ordinary Meaning Which a Reasonable Person Would Understand

[44]     Consideration of the contested construction for subclause 47.2 of 2017 EA has involved the application of the Berri principles and therefore, the approach commences with a consideration of the ordinary meaning of the relevant words, involving what is primarily a text-based analysis. In order to undertake the approach contemplated by the Berri principles involving an initial analysis of the ordinary meaning to be given to the relevant text, it is helpful to reproduce subclause 47.2 including the entire text of clause 47, and then, having guarded against any potential rewriting of the terms to achieve what might be regarded as a fair and just outcome, identification is made of any objectively determined common intention of the Parties.

[45]     To assist with this analysis, it is helpful to repeat the text of clause 47 of the 2017 EA in its entirety which is in the following terms:

“47. PROGRESSION TO FULL TIME LAME EMPLOYMENT

47.1 This clause applies where there is a vacancy for a full time LAME role. This clause does not apply to transfers of existing LAMEs between ports. Virgin Tech will retain the right to deploy or transfer LAMEs across ports as an alternative to in-port promotions.

47.2 Virgin Tech will provide preference to Team Members currently employed at classification AME 4A or LAME A, part-time LAME or permanent night shift LAME roles (where appropriately qualified) to fill vacancies for higher LAME classifications, subject to the following:

(a)The Team Member not being subject to performance management (including outstanding disciplinary action);

(b)Contractors may only be utilised where there are insufficient AMEs seeking to act up in LAME roles, the relevant AMEs do not have the qualifications or skill set required to perform the work, or the AMEs are based outside of the port where the role is located.

(c)Where a vacancy exists for a permanent LAME role, Virgin Tech will advertise the position internally.

(d)Upon receipt of all applications and if at least one appropriate application is received, the role shall be filled by either;

(i)A LAME from another Port; or

(ii)The applicant within the Port where the vacancy exists who has served the longest time employed as either a part-time LAME, LAME A, AME 4A or permanent night shift LAME and is the correct trade (B1 or B2).

(e)Should two applicants hold the same start date for preferential employment under this clause, priority will be given to the Team Member with the longest time of service with Virgin Tech. If the candidates are still equal, the decision for employment will be at Virgin Tech’s discretion.

47.3 Where a Team Member is subject to performance management (including disciplinary action within the last 12 months) they may not be eligible for selection under this clause until notified by Virgin Tech that they are no longer subject to such performance management. A Team Member who is working a fixed term or fixed task contract shall be allowed to apply and not be disadvantaged because he/she has accepted the contract position for vacancies that arise under this clause.”

[46]     It is also relevant to reproduce the text of subclause 12.9 of the 2017 EA which is in the following terms:

“12.9 Where vacancies for full-time LAME positions become available, these will be filled in accordance with clause 46.1. However, subject to compliance with the terms of this Agreement (including Clause 8 – Consultation, and Schedule 2), Virgin Tech retains the right to determine the workforce size and composition at each Port.”

[47]     There was no dispute that the reference to clause 46.1 in subclause 12.9 of the 2017 EA was an error and should have read 47.1. A correction was made to subclause 12.9 appearing in the 2020 EA so that it refers to clause 47.1. Interestingly, the counterpart provisions in the 2014 EA were subclause 11.8 and subclause 45.1, and subclause 45.1 of the 2014 EA was in all but minor detail, reproduced as subclause 47.2 in the 2017 EA.

[48]     At this point it is relevant to note that an analysis of the text used in the 2014 EA, 2017 EA, and the 2020 EA, clearly demonstrates that there has been considerable interchangeability of the terminology “clause” and “subclause” such that there has been no consistent distinction made between a subclause appearing within a clause. No criticism can be made of the absence of this distinction as enterprise agreements frequently cross-reference a “clause” when identifying what is more precisely a subclause. Thus, the text used in subclause 11.8 of the 2014 EA which referenced “clause 45.1” would have more accurately stated “subclause 45.1”.

[49]     Consequently, when the 2017 EA introduced a new subclause 47.1 before the text which previously appeared as subclause 45.1 in the 2014 EA, the cross-referencing in subclause 12.9 was not only erroneous in that it referred to clause 46.1 as opposed to 47.1 but also the numbering was not adjusted to reflect the introduction of the new subclause 47.1. In order to be consistent with the counterpart provisions that appeared in the 2014 EA, the correct cross-referencing that should have appeared in subclause 12.9 of the 2017 EA should have been “clause 47.2”.

[50]     Having regard for the historical development of the words which appear as subclause 47.2 of the 2017 EA, on any reasonable and objective contextual examination the plain and unambiguous meaning to be given to the words of the subclause exclude part-time LAME positions. The absence of ambiguity is supported by evidence of surrounding circumstances.

[51]     Firstly, the inclusion of the words “full-time” in both the heading of clause 47 and the cross-referencing provisions of subclause 12.9 cannot be ignored. The use of the words “full-time” in the heading of the clause and in the cross-referencing subclause are very deliberately intended and must be given “work to do”. It is clear that, for whatever reason(s), the authors of the text have deliberately intended to have the preference provisions which are stipulated in subclause 47.2, operate for full-time LAME positions as opposed to part-time LAME positions.

[52]     Secondly, if the preference provisions of subclause 47.2 were to apply to part-time LAME positions the text of the subclause would contain a fundamental and irreconcilable internal contradiction. The first sentence of the subclause states that “… preference to Team Members currently employed at classification AME 4A or LAME A, part-time LAME or permanent night shift LAME roles (where appropriately qualified) to fill vacancies for higher LAME classifications…” [Emphasis added]. The subclause is plainly establishing promotional preference benefits to persons currently employed in particular classifications and one of those classifications is identified as part-time LAME. There would simply be no promotional preference that would be provided if the position being filled was the same as that for which the preference was bestowed, namely a part-time LAME position. It would make no sense to give a part-time LAME preference to fill a part-time LAME position.

[53]      Consequently, on any plain and ordinary reading of the words used in subclause 47.2 of the 2017 EA, any reasonable person would logically identify that the objective common intention of the subclause was to provide promotional preference for filling full-time LAME positions and not for part-time LAME positions. This plain and ordinary meaning of the words used in subclause 47.2 is further supported by an irreconcilable contradiction that would arise if an alternative meaning was provided such that the promotional preference was provided to fill part-time LAME positions.

The Question of Fair Treatment of the Applicant

[54]     The secondary aspect of the dispute in this instance concerned the applicant’s assertion that Virgin had failed to comply with the Fair Treatment and Dispute Resolution Process requirements of the terms of subclauses 11.1 and 11.6 (a) of the 2017 EA when it dealt with his grievance concerning the disputed appointment to the vacant position filled in August 2019 (the disputed appointment). Relevantly, subclauses 11.1 and 11.6 (a) of the 2017 EA are in the following terms:

“11. FAIR TREATMENT AND DISPUTE RESOLUTION PROCESS

11.1 Virgin Tech is committed to providing a fair and equitable workplace, and ensuring concerns within the workplace are resolved as quickly and effectively as possible.

…

11.6 During the Fair Treatment and Dispute Resolution Process outlined above, a Team Member has the right to:

(a)be treated fairly;”

[55]     It is clear that the words contained in subclauses 11.1 and 11.6 (a) of the 2017 EA are aspirational terms that are susceptible to highly subjective interpretation. In respect to subclause 11.1, the applicant made criticism of the length of time that his grievance had remained unresolved. However, there were two important factors which require consideration in any objective assessment as to whether recorded criticism can be made of the timeframe with which the disputed appointment was dealt with by Virgin.

[56]     Firstly, the evidence established that the applicant expressed his disapproval and dissatisfaction in direct and contemporaneous response to the advice that he had not been successful with an appointment to the vacant part-time LAME position that was filled in August 2019. However, the extent to which the applicant agitated his grievance in August and September 2019 was confined to a series of discussions with relevant managers and other employees and at that time, circa September 2019, the applicant did not take steps to elevate the dispute formally as contemplated by subclause 11.3 of the 2017 EA.

[57]     The evidence provided by the applicant established that it was the impacts of COVID-19 that acted as the catalyst for his reactivation of the dispute in September 2020, a year after the time at which the disputed appointment had been made. Virgin management could have understandably assumed that the applicant had begrudgingly accepted the August 2019 appointment to the vacant part-time LAME position, and perhaps if it had not been for COVID-19, the applicant may never have commenced these proceedings.

[58]     Secondly, there was a very unfortunate delay that occurred when the email of 27 November 2020 from the Virgin “People Adviser” (Ms Harari) was not received by the applicant. Although the email communications data records[2] show that the email was sent by Ms Harari on 27/11/2020 at 10:17:55 AM, for some unexplained reason, it did not appear in the applicant’s email inbox. The failure by Ms Harari to provide the applicant with a response was only apparent to the applicant, and Virgin management would have understandably assumed that the absence of any further contact from the applicant in response to the 27 November 2020 email, was a reflection of apparent acceptance of the asserted operation of subclause 47.2 to the recruitment of full-time positions and not part-time positions.

[59]     The unusual and unexplained failure of the 27 November 2020 email from Ms Harari to be received by the applicant was an unfortunate factor that can only be consigned to the repository of mysteries of cyberspace. However, from the applicant’s perspective it was understandable that the absence of any acknowledgement to the email that he sent on 26 November 2020, exacerbated his level of dissatisfaction associated with both the disputed appointment and the subsequent responses provided by Virgin management. In these circumstances, it was understandable that the applicant was profoundly aggrieved and that he considered that he had been treated unfairly during the dispute resolution process.

[60]     The applicant’s grievance has been further supported by a level of justification for his more recent articulation concerning what he described as the indirect discrimination arising from the operation of subclause 47.2 of the 2017 EA. Subclause 47.2 of the 2017 EA (and the counterpart provisions identified in the 2014 EA and the 2020 EA) clearly establishes a promotional progression regime that inter alia, stipulates that promotion into the higher LAME roles must be provided to individuals currently employed at the highest of the AME levels, AME 4A. Putting aside the other LAME positions which are also identified for preference to the higher LAME roles, the fundamental principle upon which the subclause operates is that promotion from an AME classification to a (full-time) LAME classification is to occur from the highest of the AME classifications namely, AME 4A.

[61]     Consequently, the foundational principle evident in subclause 47.2 would generally prohibit any AME who was not at the highest AME classification of AME 4A from being promoted into a (full-time) LAME classification. Presumably this principle recognises that there are sound operational and organisational benefits associated with ensuring that the most highly skilled and qualified AMEs are promoted into the higher LAME roles. Similarly, the principle engages a mechanism to avoid the potential that lesser skilled AMEs are promoted into the higher skilled LAME roles over their more skilled AME colleagues.

[62]     Using the terminology expressed by the applicant, subclause 47.2 prohibits the “leapfrogging” that occurred with the disputed appointment made in August 2019. However, it does not have application in respect of a part-time position. There was no identifiable basis for why the principle which prohibited “leapfrogging” would be excluded from operation in respect to filling a part-time position. There is a level of irrationality and clear inconsistency with the application of the principle that prohibited “leapfrogging” into full-time LAME positions, but which had no application in respect to a part-time LAME position.

[63]     The irrational and inconsistent application of the principle that underpins a prohibition on “leapfrogging” and excludes the operation of the principle in respect to part-time positions has provided an understanding and a level of justification for the applicant’s grievance. However, it is unlikely that an apparently irrational and inconsistent application of a preferential promotional system would be found to represent an unlawful or discriminatory term as contemplated by ss. 194 and 195 of the Act. In any event, the Commission is not empowered in these proceedings to make any determination or declarations regarding a purportedly discriminatory term in an enterprise agreement.

[64]     Although the Commission may recognise, understand, and provide a level of legitimacy for the applicant’s profound level of dissatisfaction with both the disputed appointment made in August 2019, and aspects of the more recent handling of his ongoing dispute, on any balanced and objective analysis, no finding can be made that Virgin failed to comply with the requirements of subclauses 11.1 and 11.6 (a) of the 2017 EA. The requirements of subclauses 11.1 and 11.6 (a) were only engaged on and from September 2020, when the applicant formally reactivated his grievance concerning the disputed appointment. The subsequent conduct of Virgin management was unfortunately distorted from the applicant’s perspective in large part because of the unfortunate and unusual failure of communication of the 27 November 2020 email from Ms Harari. In all other respects Virgin has endeavoured to deal with the applicant’s dispute efficiently and respectfully.

Conclusion

[65]     In this case, the Commission has been required to determine two contested construction questions regarding firstly, the terms contained in subclause 47.2 of the 2017 EA, and secondly subclauses 11.1 and 11.6 (a) of the 2017 EA have required examination. Specifically, the Parties agreed upon the wording of two questions arising from the correct construction to be provided to the terms of the relevant subclauses.

[66]     In respect to the primary question, having regard for all of the evidence that was presented, and by application of the principles relevant to the task of construing contested terms such as those under examination in this instance, the Commission has determined that the terms appearing in subclause 47.2 of the 2017 EA should be given their plain and ordinary meaning. The determination of the contested construction question has resulted from an analysis that identified that the contested terminology should be given its plain and ordinary meaning. The objective common intention of subclause 47.2 of the 2017 EA has been established as there has been no identified basis to depart from an interpretation which a reasonable person would understand by the language the Parties have used to express their agreement, without regard to the subjective intentions or expectations of the Parties. Therefore, the plain and ordinary meaning of the words contained in subclause 47.2 establish that it operated only in respect to filling vacancies for full-time LAME positions.

[67]     The determination of the second question has involved an analysis of the evidence of the conduct of both the applicant and Virgin management during the period that followed from the disputed appointment made in August 2019. On balance, there can be both criticism and commendation made of different aspects of the conduct of both Parties. However, the evidence has not supported a finding that Virgin deliberately failed to comply with obligations arising from subclauses 11.1 and 11.6 (a) of the 2017 EA.

[68]     Consequently, the dispute has been determined by answering the first question for determination in the negative. That is, Virgin was not required to apply the provisions of subclause 47.2 of the 2017 EA in respect to its determination of the successful individual appointed to the internal job vacancy advertised in June 2019, because subclause 47.2 was confined in its operation to filling of full-time LAME positions

[69]     Further, the second question for determination has been answered in the positive. That is, Virgin complied with the requirements that arise from the terms of subclauses 11.1 and 11.6 (a) of the 2017 EA in respect to its conduct associated with dealing with the grievance of the applicant during the period that followed the disputed appointment was made in August 2019.

[70]     In view of the answers that have been provided for the agreed questions for determination of the dispute, the application is dismissed accordingly. An Order dismissing the application will be issued separately.

COMMISSIONER

Appearances:

Mr J Swinson appeared unrepresented.

Ms L Khan, Senior Legal Counsel appeared for the employer.

Hearing details:

2021.
Sydney:
November, 4 (video hearing).

[1] Ibid @ para [114].

[2]     Exhibit 2 – Annexure JH-2.

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