Mark Rhodes v Arrow Energy Pty Ltd

[2020] FWC 4007

[2020] FWC 4007

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

Mark Rhodes
v
Arrow Energy Pty Ltd
(C2020/2452)

DEPUTY PRESIDENT ASBURY BRISBANE, 1 SEPTEMBER 2020

Alleged dispute about any matters in a contract of employment or other written agreement in relation to the NES or a safety net contractual entitlement; [s738(c)] – Finding that dispute resolution term does not require or allow the Commission to deal with a dispute as required by s. 739(1) – Application cannot be made under s. 739(6) – Commission has no jurisdiction to deal with application – Application dismissed.

BACKGROUND

[1] This Decision concerns an application to the Commission by Mr Mark Rhodes (the Applicant) under s. 739 of the Fair Work Act 2009 (the Act) seeking that the Fair Work Commission (the Commission) deal with a dispute in accordance with a dispute settlement procedure said to be incorporated into the Applicant’s contract of employment. The dispute relates to the entitlement of the Applicant to be paid redundancy payments under s. 119 of the Act in circumstances where his position is no longer required by the Company and the Applicant has been offered redeployment.

[2] The Respondent objects to the application asserting that the Commission does not have jurisdiction to deal with the application on the basis that the Applicant is not employed under a modern award or enterprise agreement that provides a procedure for dealing with disputes and that his common law contract of employment does not contain a procedure for dealing with disputes about any matter relating to the National Employment Standards (NES) or any other matter. The Respondent further contends that it does not have a policy or procedure which allows the Commission to make a determination about such disputes and it does not agree to the Commission making a determination.

[3] Directions were issued requiring the parties to file outlines of submissions and any witness statements upon which they intended to rely in relation to the jurisdictional objection and the matter was listed for hearing. The Respondent filed written submissions and a statement made by its Human Resource Manager, Mr Christopher Owen Conlan. The Applicant filed written submissions. A hearing was conducted by telephone. The Applicant did not seek to cross-examine Mr Conlan and his statement was admitted without objection.

THE COMMISSION’S POWER TO DEAL WITH DISPUTES

[4] Section 595 of the Act deals with the Commission’s power to deal with disputes and is in the following terms:

“595 FWC’s power to deal with disputes

(1) The FWC may deal with a dispute only if the FWC is expressly authorised to do so under or in accordance with another provision of this Act.

(2) The FWC may deal with a dispute (other than by arbitration) as it considers appropriate, including in the following ways:

(a) by mediation or conciliation;

(b) by making a recommendation or expressing an opinion.

(3) The FWC may deal with a dispute by arbitration (including by making any orders it considers appropriate) only if the FWC is expressly authorised to do so under or in accordance with another provision of this Act.

Example: Parties may consent to the FWC arbitrating a bargaining dispute (see subsection 240(4)).

(4) In dealing with a dispute, the FWC may exercise any powers it has under this Subdivision.

Example: The FWC could direct a person to attend a conference under section 592.

(5) To avoid doubt, the FWC must not exercise the power referred to in subsection (3) in relation to a matter before the FWC except as authorised by this section”

[5] Sections 738 and 739 of the Act set out provisions in the relation to the Commission dealing with disputes as follows:

“738 Application of this Division

This Division applies if:

(a) a modern award includes a term that provides a procedure for dealing with disputes, including a term in accordance with section 146; or

(b) an enterprise agreement includes a term that provides a procedure for dealing with disputes, including a term referred to in subsection 186(6); or

(c) a contract of employment or other written agreement includes a term that provides a procedure for dealing with disputes between the employer and the employee, to the extent that the dispute is about any matters in relation to the National Employment Standards or a safety net contractual entitlement; or

(d) a determination under the Public Service Act 1999 includes a term that provides a procedure for dealing with disputes arising under the determination or in relation to the National Employment Standards.

739 Disputes dealt with by the FWC

(1) This section applies if a term referred to in section 738 requires or allows the FWC to deal with a dispute.

(2) The FWC must not deal with a dispute to the extent that the dispute is about whether an employer had reasonable business grounds under subsection 65(5) or 76(4), unless:

(a) the parties have agreed in a contract of employment, enterprise agreement or other written agreement to the FWC dealing with the matter; or

(b) a determination under the Public Service Act 1999 authorises the FWC to deal with the matter.

Note: This does not prevent the FWC from dealing with a dispute relating to a term of an enterprise agreement that has the same (or substantially the same) effect as subsection 65(5) or 76(4) (see also subsection 55(5)).

(3) In dealing with a dispute, the FWC must not exercise any powers limited by the term.

(4) If, in accordance with the term, the parties have agreed that the FWC may arbitrate (however described) the dispute, the FWC may do so.

Note: The FWC may also deal with a dispute by mediation or conciliation, or by making a recommendation or expressing an opinion (see subsection 595(2)).

(5) Despite subsection (4), the FWC must not make a decision that is inconsistent with this Act, or a fair work instrument that applies to the parties.

(6) The FWC may deal with a dispute only on application by a party to the dispute.”

SUBMISSIONS

[6] In the present case, it is not in dispute that the Applicant was employed by the Respondent as an appraisal field superintendent from 1 January 2014. It is common ground that the Applicant was not employed under a modern award or an enterprise agreement. It is also common ground that the Applicant was employed under a common law employment contract which does not expressly provide a procedure for dealing with disputes.

[7] In December 2019, the Applicant was informed that his position was no longer required and was offered redeployment to another position. The substantive dispute relates to whether the Applicant is entitled to redundancy payments under s. 119 of the Act. In the Form F10 Application for the Commission to deal with a dispute, the Applicant states that the instrument or other written agreement containing the dispute settlement procedure is a “Contract of Employment Agreement.” The Applicant also states in the Form F10 that there is no dispute resolution clause in the contract.

[8] In relation to what clause of the written agreement the dispute relates to, the following statement is made:

“The dispute relates to a clause under the subheading ‘Termination of Employment’ and the paragraph stating ‘In the event your employment is terminated by reason of redundancy, you will be entitled to redundancy pay no less favourable than applicable benefits required by the NES’,”

[9] The Applicant’s submissions referred to a provision of the Applicant’s contract of employment dealing with Company Policies, Procedures and Benefits, which is in the following terms:

“Company Policies, Procedures and Benefits

The Company has detailed policies and procedures which operate independently from this contract of employment. These policies and procedures deal with a variety of matters, including standards of behaviour, workplace processes and additional employee benefits which are provided at the Company’s sole discretion. The policies or procedures may be added to, modified, replaced, or withdrawn at any time.

You are expected to comply with the Company’s policies and procedures, and a failure to do so may be taken into account in assessing your performance and your conduct as an employee. Conduct which is in breach of policies or procedures may in particular cases justify termination of employment. You should, therefore, ensure that you are familiar with the Company’s policies and procedures, which can be obtained from your immediate manager. You will also be required to keep up to date with any amendments or additions to these policies and procedures.

The Company will also act consistently with the policies and procedures. Unless specifically provided in this contract, however, the policies and procedures are not contractually binding as between you and the Company, and any failure by the Company to follow a particular term of a policy or procedure will not amount to a breach of any express or implied term of this employment contract.”

[10] The Applicant contended that by virtue of this provision, Arrow Energy policies and procedures were incorporated into his contract of employment, including a procedure dealing with Workplace Complaints designated ORG-ARW-HRM-PRO. It was submitted that notwithstanding attempts to the contrary, the Workplace Complaints Procedure is incorporated into the contract on the basis that: compliance with the policies is required by the contract; non-compliance with policies sounds in termination; the requirement that the Applicant is familiar and up to date with the polices; and for the Company to act consistently with them.

[11] The Applicant contends that the Workplace Complaints Procedure is a procedure for dealing with disputes, and that the procedure is incorporated into his contract of employment, so that he is entitled to make an application pursuant to s. 739(6) of the Act for the Commission to deal with the substantive dispute. The Workplace Complaints Policy relied on by the Applicant has as its purpose, the establishment of formal and informal processes for employees to raise concerns and complaints about workplace issues. Workplace issues are defined in 2.1 of the Policy as: allegations of discrimination, harassment, unfair treatment, victimisation, sexual harassment and other issues of a human resources nature in the workplace in breach of Arrow Energy Human Resource Policies.

[12] The processes for raising concerns and complaints are set out respectively in clauses 5.1 and 5.2 of the Policy. Essentially the Policy provides for escalating matters to various levels of management within Arrow culminating in the resolution of a matter about which an employee is not satisfied, being referred to the Vice President of Human Resources.

[13] The Respondent contends that it does not have any policy or procedure which would provide the Commission with the powers to determine a dispute between the parties regarding an entitlement under the NES and referred to Mr Conlan’s statement to this effect. Mr Conlan detailed in his witness statement that he had reviewed Arrow’s suite of policies and procedures and confirmed that the Respondent does not have a policy or procedure which allows the Commission to make a determination in relation to a dispute between the parties regarding an entitlement under the NES.

[14] In its written reply submissions, the Respondent focused on s.739(4) of the Act and submitted that the actual reference in the Company’s Workplace Complaints Policy, which details processes for dealing with employees’ concerns and complaints, specifies: “Other issues of a Human Resource nature in the workplace in breach of Arrow Energy Human Resource Policies” as types of disputes which could be dealt with under the Policy. The Respondent submitted that the scope of the listed categories were not in relation to the minimum entitlements under the NES. The Respondent further submitted that it does not agree that the Commission may arbitrate this matter in respect to s.739(4) of the Act.

CONSIDERATION

[15] The Commission’s powers to deal with disputes are limited to powers derived from a dispute settlement term agreed to by the parties in an enterprise agreement or a contract of employment or other written agreement, or a term included in a modern award. As a Full Bench of the Commission observed in CFMEU v North Goonyella Coal Mines Pty Ltd¹ the Commission may deal with a dispute only on application of a party to the dispute (s.739(6)); is prohibited from exercising any powers limited by the dispute settlement procedure (s.739(3)); may arbitrate only if the agreed dispute settlement procedure permits it to do so (s.739(4)); and must not make a decision that is inconsistent with the Act, the enterprise agreement and any other applicable fair work instrument (s.739(5)).

[16] It is axiomatic that Division 2 of the Act does not apply at all unless there is a term in a modern award, an enterprise agreement or a contract of employment or other written agreement, that provides a procedure for dealing with disputes. Further, the Commission cannot deal with a dispute unless the relevant term requires or allows the Commission to do so.

[17] The difficulty for the Applicant in the present case is that his written contract of employment does not contain a procedure for dealing with disputes. A further difficulty is that even if his argument in relation to the Workplace Complaints Procedure is accepted, that Procedure does not require or allow the Commission to deal with a dispute that an employee seeks to articulate under the Procedure.

[18] The Commission is not empowered to deal with every workplace grievance or dispute raised by an employee, simply because the employee is aggrieved or in dispute with an employer. Section 739(6) of the Act does not allow an application to the Commission to deal with a dispute in accordance with a dispute settlement term to be made, in circumstances where the relevant term does not require or allow the Commission to deal with a dispute. As a result, the Commission is not expressly authorised to deal with the dispute and its powers to do so are not enlivened because of s. 595(1).

[19] This is fatal to the present application and in those circumstances, it is not necessary to determine whether the Workplace Complaints Procedure is incorporated into the Applicant’s contract of employment or whether a dispute about an entitlement to redundancy is within the scope of the Procedure. It is also not necessary to determine the preliminary issue of whether a dispute resolution term can be incorporated into a contract of employment which does not contain such a procedure, so that the Commission is expressly authorised to deal with the dispute as required by s. 595(1) of the Act.

CONCLUSION

[20] Accordingly, the Commission has no jurisdiction to deal with the dispute and the application must be dismissed. An Order to that effect will issue with this Decision.

DEPUTY PRESIDENT

Appearances:

Mr R Clutterbuck of Counsel instructed by Ms S Mitchell of Geldard Sherrington Lawyers for the Applicant.

Mr C Conlan for the Respondent.

Hearing details:

8 June.

2020.

By telephone.

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1 [2015] FWCFB 5619.