Latrobe City Council

[2022] FWCA 2725

[2022] FWCA 2725

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.217—Enterprise agreement

Latrobe City Council

(AG2022/2243)

Latrobe City Council Enterprise Agreement 2021 (No. 9)

Local government administration
DEPUTY PRESIDENT COLMAN	MELBOURNE, 11 AUGUST 2022

Application to vary an enterprise agreement to remove ambiguity or uncertainty

1. Latrobe City Council (Council) has made an application under s 217(1) of the Fair Work Act 2009 (Cth) (Act) to remove an ambiguity or uncertainty in the Latrobe City Council Enterprise Agreement 2021 (No. 9) (Agreement).

1. The ambiguity or uncertainty is said to be found in Appendix C to the Agreement, which contains a table setting out various allowances. The table identifies the clauses of the Agreement that create the various entitlements to allowances, the names of the allowances, and the method of calculation of the allowances. It then stipulates the quantum of the allowances as of 1 September 2021. The second to last allowance in the table is ‘Nurses – Qualification Allowance – per hour’. There are three categories of this allowance, for which nurses holding the applicable qualifications are paid the following amounts:

·   Hospital certificate or graduate certificate: 4% of ‘MCH’ (maternal child health nurse), at the year 1 base rate of pay. The amount of the allowance as of 1 September 2021 is said to be $2.07.

·   Post-graduate diploma or degree: 6.5% of MCH, at the year 1 base rate of pay. The amount of the allowance as of 1 September 2021 is said to be $3.37.

·   Masters or doctorate: 7.5% of MCH at the year 1 base rate of pay. The amount of the allowance as of 1 September 2021 is said to be $3.89.

1. The Council submits that there are two errors in the table in Appendix C. First, the relevant clause which creates the entitlement to an allowance is not clause 22.17.1, as stated in the table, but clause 22.16. Secondly, the amounts specified as applying as of 1 September 2021 are said to be incorrect, and the product of a miscalculation. The Council contends that, when one applies the calculation percentage in the table to the base rate of pay identified in clause 22.16, lower amounts are produced, namely: $1.08, $ 1.75 and $2.02.

1. It is clear that the table refers to the wrong substantive clause number. The relevant provision is clause 22.16, not clause 22.17. Clause 22.16.1 states that for the purpose of calculating nurses’ allowances under that clause, ‘the standard rate shall be $1023.80, and will be increased annually in accordance with the salary increase (percentage increase) as outlined in clause 21 (Salary Increases) and Refer to Appendix [C] …’ Clause 22.16.2 then states that a nurse who holds particular qualifications will be paid the allowance set out in that clause. A table appears, prescribing percentages for the various qualifications.

1. When one applies the percentages in clause 22.16.2 to the standard rate, the following weekly amounts are produced: $40.952, $66.547, and $76.785. When these are divided by 38, one obtains the hourly rates set out in the Council’s application. It is clear then that, applying the substantive allowance provision in clause 22.16, the amounts specified in Appendix C as applying from 1 September 2021 are incorrect.

1. Section 217 of the Act provides that the Commission ‘may vary an enterprise agreement to remove an ambiguity or uncertainty’. The principles that apply to the Commission’s consideration of such applications are well-settled. The Commission must first identify whether there is any ambiguity or uncertainty in the agreement. The presence of ambiguity or uncertainty is a jurisdictional prerequisite to the exercise of the discretion to vary the instrument. The Commission is required to make a positive finding as to whether the relevant provisions of the agreement are ambiguous or uncertain, based on an objective assessment of the meaning of the words in question. The Commission must bear in mind the distinction between ambiguity and uncertainty. If ambiguity or uncertainty is identified, the Commission must then consider whether to exercise its discretion to vary the agreement. As I have said on previous occasions, a decision of the Commission under s 217 to remove uncertainty or ambiguity should give effect to the substantive agreement that was ambiguously or uncertainly reduced to writing in the terms of the enterprise agreement.

1. In my view, Appendix C contains an obvious calculation error. The text of the Agreement is not ambiguous, because it is clear what is intended. However, I consider that the incorrect amounts specified in the table in Appendix C nevertheless create some uncertainty, particularly for employees who may look to the table as a ready reference to ascertain the value of the qualifications allowances. The Agreement is uncertain in this respect. The next question is whether I should exercise my discretion to remove the uncertainty. I am persuaded to do so for the following reasons.

1. First, I am satisfied that the proposed variation to the Agreement would align the text of Appendix C with the manner in which the allowance provision was clearly intended to operate. Secondly, I do not consider that employees are likely to have been misled by the error in Appendix C; the explanation of the calculation of the allowances in the body of the Agreement is clear. Moreover the explanatory materials provided by the Council to employees prior to the vote to approve the Agreement identified and explained provisions in the previous agreement that would change. The allowances provision was not among them. Thirdly, I consider that the erroneous figures in the appendix could cause confusion and that it is appropriate to correct them. Fourthly, at a mention hearing on 10 August 2022, union bargaining representatives for the Agreement, including the Australian Nursing and Midwifery Federation (ANMF) whose members would be affected by the proposed variation, advised the Commission that they did not oppose the variation and did not seek to be heard.

1. I find that the Agreement is uncertain in the respect that I have identified above. I consider that I should exercise my discretion to remove that uncertainty by varying the Agreement as follows:

   (a)   Delete from Appendix C the clause number ‘22.17.1’ and insert in its place ‘22.16’; and

   (b)   Delete from Appendix C the dollar amounts appearing in column 4 in respect of nurses qualification allowances, namely ‘$2.07’, ‘$3.37’, and ‘$3.89’, and insert in their place the amounts ‘$1.08’, ‘$1.75’, and ‘$2.02’.

2. The variation will operate from the date of this decision.

DEPUTY PRESIDENT

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