Matthew Hester v Metropolitan Fire and Emergency Services Board

[2016] FWC 6790

[2016] FWC 6790

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

Matthew Hester
v
Metropolitan Fire and Emergency Services Board
(C2016/773)

COMMISSIONER WILSON MELBOURNE, 23 SEPTEMBER 2016

Application for the Commission to deal with a dispute - provisions of enterprise agreement for the granting of Defence Force Leave - whether additional days’ leave are paid time off.

[1] This decision concerns an application by Matthew Hester for the Fair Work Commission to deal with a dispute pursuant to the provisions of s.739 of the Fair Work Act 2009 (the Act). Mr Hester’s application submits that jurisdiction for the Commission to deal with a dispute arises from the Metropolitan Fire and Emergency Services Board, United Firefighters Union of Australia, Operational Staff Agreement 2010 1 (2010 Agreement).

[2] Mr Hester is presently employed by the Metropolitan Fire and Emergency Services Board (MFB) as a firefighter. He has been represented in the conduct of his case by his union, the United Firefighters’ Union of Australia (UFU).

[3] In short, the dispute concerns the question of whether Mr Hester should have been provided with paid Defence Force Leave during a period he was absent from the MFB on approved leave as part of his duties as a member of the Australian Defence Force (the ADF). While employed as a firefighter by the MFB, Mr Hester was released from his firefighting duties for active service with the ADF in Afghanistan between 31 July 2009 and 13 May 2010. During the period of his service in Afghanistan Mr Hester was granted a mixture of paid and unpaid Defence Force Leave as well as annual leave.

[4] He now seeks, through this application, to be paid by the MFB for 1,008 hours of unpaid Military Leave as well as to have annual leave that was granted to him to be recredited to his leave balance.

[5] Both parties sought representation in the proceedings by a lawyer, relying on the criteria within s.596(2)(a) of the Act that it would enable the matter to be dealt with more efficiently, taking into account the complexity of the matter. I was satisfied that this was the case, and Mr J McKenna appeared for the Applicant, instructed by Mr J Murphy of the UFU, and Mr M Felman appeared for the Respondent, instructed by Mr B Popple of Herbert Smith Freehills.

LEGISLATION

[6] Mr Hester’s application to the Commission is made pursuant to s.739 of the Act which provides jurisdiction to deal with disputes in certain circumstances set out within that section and s.738, namely where a “term” of a modern award, an agreement or a contract or Public Service Determination allows. Arbitration of a dispute may only be where the parties have agreed for that to occur, in accordance with the term. The Commission’s powers to deal with a dispute under the section are constrained in the ways set out in the section, and most particularly in the way set out in sub-section (5), such that the Commission may not make a decision that is inconsistent with the Act or a fair work instrument applicable to the parties.

[7] Sections 738 and 739 provide;

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.

RELEVANT FACTUAL BACKGROUND

[8] The parties are agreed that at all relevant times Mr Hester has been employed by the MFB as a firefighter and that for the duration of his employment has been covered by various enterprise agreements applying to operational firefighters within the MFB. There is also agreement that Mr Hester was absent from the MFB, on approved leave, for the purposes of service in the ADF Reserve. The Applicant’s submissions indicate that this period of absence was between 31 July 2009 and 13 May 2010. During the period of his service with the ADF Mr Hester was in Afghanistan and was on active combat service.

[9] There is also agreement between the parties that, during the period of his assignment to the ADF, Mr Hester was granted by the MFB a mixture of paid and unpaid Defence Force Leave, as well as paid annual leave.

[10] The MFB submissions on the matter record that the payments to Mr Hester in this regard were as follows;

• Paid Defence Force Leave between 31 July 2009 and 2 September 2009;



• Annual leave from 3 September 2009 to 28 October 2009;



• Unpaid Defence Force Leave from 29 October 2009 to 14 April 2010; and



• Paid Defence Force Leave from 15 April 2010 to 13 May 2010. 2

[11] There is also agreement between the parties that, despite Mr Hester being provided a mixture of paid and unpaid leave from the MFB, some other employees within the MFB and also employed under the same enterprise agreements received paid leave from the MFB for the entire duration of their service with the Australian Defence Force. These other employees appear to have been released on Defence Force Leave at around the same time as Mr Hester, and for similar durations.

[12] Oral evidence in this matter was limited to the evidence of Aaron Hogan on behalf of the MFB, who is employed by the organisation as an Industrial Relations Consultant. Mr Hogan’s evidence went principally to the question of the number of other reservists employed within the MFB and arrangements which had been made in relation to them. Statutory declarations were also received on behalf of the Applicant, declared by three firefighters, Alfonso Lai, Robert Dore and Bradley Watkins, each of whom put forward that during their period of service with the ADF they received their “full wage entitlement from the Australian Army and the Metropolitan Fire & Emergency Services Board”.

[13] The effect of the claim being made by Mr Hester is that, notwithstanding the payments he may have received during the course of his active service from the Australian Defence Force, he should be paid by the MFB as if he was at work during the period. Further, it is put that so far as any part of his absence was paid by the MFB as annual leave, with the effect of reducing his annual leave balance, that such should be recredited to him so that he may enjoy the annual leave at some other time.

THE APPLICANT’S DRAFT DETERMINATION

[14] Mr Hester’s Draft Determination for these proceedings, filed in accordance with directions from the Commission, is in the following terms (incorporating a minor change to take account of the leave chronology recorded at [10] above);

“The Fair Work Commission orders as follows:

1. In accordance with clause 45 of the Metropolitan Fire and Emergency Services Board and United Firefighters' Union Operational Staff Agreement 2005, the Metropolitan Fire and Emergency Services Board shall provide Matthew Hester with payment of his ordinary wages for the period between 29 October 2009 and 14 April 2010 where he was granted unpaid Military Service Leave.

2. The Metropolitan Fire and Emergency Services Board shall re-credit all Annual Leave taken by Mr. Hester between 3 September 2009 and 28 October 2009 to his Annual Leave balance.” 3

CONSIDERATION

[15] It is argued that the dispute arises under the Metropolitan Fire and Emergency Services Board, United Firefighters Union of Australia, Operational Staff Agreement 2005 4 (2005 Agreement) which includes a dispute resolution procedure for the purpose of ensuring effective consultation between the parties to the agreement “on all matters pertaining to the employment relationship, including the application of this agreement”.5 The corresponding clause in the enterprise agreement which currently applies, the 2010 Agreement, sets out a dispute resolution procedure in clause 19, which is in different terms, relating to disputes arising under the agreement, with the parties having agreed that such includes;

“…
19.1.1. all matters for which express provision is made in this agreement; and
19.1.2. all matters pertaining to the employment relationship, whether or not express provision for any such matter is made in this agreement; and
19.1.3. all matters pertaining to the relationship between the MFESB and UFU, whether or not express provision for any such matter is made in this agreement. …”

[16] It should be noted that references to the “MFESB” in the 2010 Agreement are to the Metropolitan Fire & Emergency Services Board, otherwise referred to as the MFB in this decision. Further, the terms “Defence Force Leave” and “Military Service Leave” are used interchangeably.

[17] Mr Hester and the UFU argue that the dispute is brought to the Commission because of the dispute resolution provisions of the 2010 Agreement, with the substantive matter to be determined being an entitlement arising under the 2005 Agreement. In this regard, it submits that;

“20. Mr Hester’s claimed entitlement to defence force leave under cl 44 of the 2005 Agreement is a matter which pertains to the employment relationship. The applicant does not understand the respondent to suggest otherwise. That being so, it is a matter falling within the scope of the clause and the jurisdiction of the Commission” 6

[18] In contrast, the MFB argue that, because the time period of Mr Hester’s claim is a period during the operation of the 2005 Agreement, there is no jurisdiction for the Commission to proceed to determine the application under the terms of the 2010 Agreement, but that it consents to the Commission providing an interpretation of the 2010 Agreement, which it will then abide by;

“11. While the Commission does have jurisdiction to resolve disputes under the 2010 Agreement, Hester's entitlement to leave (paid or otherwise) in relation to the military leave period arose only under the 2005 Agreement. Therefore, the Commission does not have jurisdiction to resolve the dispute as articulated by Hester in the Application under the 2010 Agreement.

12. However, in order to resolve the dispute between Hester and the MFB in relation to Hester's entitlement to be paid for the military leave period, the MFB consents to the Commission providing its interpretation of clause 63 of the 2010 Agreement in this dispute procedure. The MFB will then comply with this interpretation in relation to Hester's claim for pay for the military leave period.” 7

[19] In dealing with a dispute such as this the Commission is not undertaking an exercise of judicial power but is instead exercising a power of private arbitration, with that power deriving from the parties’ agreement to submit their differences for decision by a third-party and the resultant arbitrator’s award not being binding of its own force but instead its effect depending on the law which operates with respect to it. 8 It is accepted that while not exercising judicial power, the Commission “may legitimately form and act upon opinions about legal rights and obligations as a step in the exercise of its own functions and powers”.9

[20] In considering whether the dispute settlement procedure in an enterprise agreement “requires or allows” the Commission to deal with the dispute, it is necessary to look at the text of the dispute settlement procedure, understood in light of its industrial context and purpose, to determine whether the dispute, properly characterised, falls within it. 10 However in doing so the scope of a dispute settlement procedure in an enterprise agreement should not be narrowly construed.11 In characterising the nature of a dispute the Commission is not confined to the application filed to deal with the dispute.12 The entire factual background is relevant, and may be ascertained from the submissions advanced by the parties on the question of jurisdiction.13 Further, a dispute may evolve during proceedings in the Commission. It may therefore be necessary in some cases when ascertaining the character of a dispute to have regard to both the nature of the dispute alleged in an originating application and the factual circumstances as they evolve.14

[21] While the character of a dispute is distinguishable from any relief which may be sought, or granted, following an arbitration of the dispute, 15 in some cases the relief sought may cast light on the true nature of the dispute.16

[22] Having found jurisdiction to deal with the dispute, the nature of the relief that may be granted will depend on the limitation in s.739(5) of the Act 17 and the agreement of the parties as recorded in their enterprise agreement, provided that such relief is reasonably incidental to the application of the enterprise agreement to which the dispute relates.18

[23] As a private arbitrator, the Commission is authorised to make decisions as to the legal rights and liabilities of parties to whom the enterprise agreement applies, 19 which involves deciding “all questions both of law and of fact”20 that arise in the dispute, subject to any limitation on power in the dispute settlement clause, together with the requirement not to make a decision that is inconsistent with the Act, or a fair work instrument that applies to the parties.

[24] Interpretation of an enterprise agreement requires construction of the words of the instrument, with the Full Bench in AMIEU v Golden Cockerel Pty Ltd 21 (Golden Cockerel), setting out the principles for such task. In that matter, and after an extensive analysis of the subject, the Full Bench summarised the principles to be applied in the following way;

“[41] From the foregoing, the following principles may be distilled:

1. The AI Act 22 does not apply to the construction of an enterprise agreement made under the Act.

2. In construing an enterprise agreement it is first necessary to determine whether an agreement has a plain meaning or contains an ambiguity.

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

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

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

6. Admissible evidence of the surrounding circumstances is evidence of the objective framework of fact and will include:

(a) 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;

(b) notorious facts of which knowledge is to be presumed;

(c) evidence of matters in common contemplation and constituting a common assumption.

7. The resolution of a disputed construction of an agreement will turn on the language of the Agreement understood having regard to its context and purpose.

8. Context might appear from:

(a) the text of the agreement viewed as a whole;

(b) the disputed provision’s place and arrangement in the agreement;

(c) the legislative context under which the agreement was made and in which it operates.

9. Where the common intention of the parties is sought to be identified, regard is not to be had to the subjective intentions or expectations of the parties. A common intention is 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.

10. 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.”

[25] The Defence Force Leave provisions in the applicable enterprise agreements have varied only twice across the four separate agreements in operation since 1999;

• The 1999 Agreement 23 provided for defence force leave in these terms;

“41 DEFENCE FORCE LEAVE

Leave of absence with pay may be granted for fourteen days in any year to any employee who is a voluntary member of the Citizen Forces for the purpose of attending an annual training camp, and a further four days a year for the same purpose on the certification of the Commanding Officer of the particular service unit concerned that such additional days are required. An employee shall refund to the employer all remuneration up to the equivalent of his/her MFESB normal pay for the period of absence from any remuneration received in the course of such absence. Reimbursement of costs incurred during such absence are not to be included in the calculation of reimbursement received.” 24

• The 2002 Agreement 25 deleted the last two sentences of the foregoing provision, and inserted a replacement final sentence, with the full clause providing the following;

“44. DEFENCE FORCE LEAVE

Leave of absence with pay may be granted for fourteen days in any year to any employee who is a voluntary member of the Citizen Forces for the purpose of attending an annual training camp, and a further four days a year for the same purpose on the certification of the Commanding Officer of the particular service unit concerned that such additional days are required.

Where additional days are required for the purpose of service or travelling, requests for additional time off work shall be granted.” 26

• Other than for clause numbering, the provision for Defence Force Leave in the 2005 Agreement 27 is in the same terms as the 2002 Agreement; and



• The provision for Defence Force Leave in the 2010 Agreement is largely unaltered from the terms within the 2002 and 2005 Agreements, with the only change being substitution of the phrase “voluntary member of the Citizen Forces” with “voluntary member of the Reserve Forces”;

“63. DEFENCE FORCE LEAVE

63.1. Leave of absence with pay may be granted for fourteen days in any year to any employee who is a voluntary member of the Reserve Forces for the purpose of attending an annual training camp, and a further four days a year for the same purpose on the certification of the Commanding Officer of the particular service unit concerned that such additional days are required.

63.2. Where additional days are required for the purpose of service or travelling, requests for additional time off work shall be granted.” 28

[26] The dispute in this matter goes to the question of whether, because of an enterprise agreement term, Mr Hester is entitled to be paid by the MFB for the leave he took in 2009 and 2010 for his ADF service. The answer to that question involves a consideration of words within a clause that has not substantially changed since the making of the 2002 Agreement. Because of the findings I make about those words, it becomes unnecessary for me to determine the question of whether the Commission has jurisdiction to make the orders sought by Mr Hester.

[27] Because there is a contest by the MFB about the jurisdiction to determine the dispute, as well as the fact that the 2010 Agreement is the currently operating agreement, I will base my construction upon the terms of the 2010 Agreement, while noting that I consider it to have application to the term within the 2005 Agreement as well. In doing so, I note the MFB’s preparedness to accept and comply with the Commission’s interpretation of the 2010 Agreement, notwithstanding its jurisdictional objection. 29

[28] After considering the matters of jurisdiction and the Applicant’s Draft Determination, referred to above, I am satisfied that it broadly provides an accurate characterisation of the dispute before the Commission, however I rephrase the draft as these questions to be determined by the Commission;

1. Is the MFB required to provide Matthew Hester with payment of his ordinary wages for the period between 29 October 2009 and 14 April 2010 where he was granted unpaid Military Service Leave?

2. Is the MFB required to re-credit all Annual Leave taken by Mr. Hester between 3 September 2009 and 28 October 2009 to his Annual Leave balance?

[29] The first matter for consideration in resolving these questions is whether the disputed clause, as now set out in Clause 63 of the 2010 Agreement, has a plain meaning or contains an ambiguity. In ascertaining whether an ambiguity exists, regard may be had to evidence of surrounding circumstances, however if the agreement has a plain meaning evidence of the surrounding circumstances will not be admitted to contradict the plain language of the 2010 Agreement.

[30] The evidence of surrounding circumstances pointed to by the parties include the change made to the term when the 2002 Agreement was made, and the MFB’s approval of paid Defence Force Leave to other employees who took leave around the same time as Mr Hester and since.

[31] Mr Hester submits in relation to the 1999 Agreement that employees were entitled to be paid Defence Force Leave in order to attend the annual training camp only, with no entitlement to additional time off. 30 That submission is based upon the changes made at the commencement of the 2002 Agreement which inserted the sentence that “[w]here additional days are required for the purpose of service or travelling, requests for additional time off work shall be granted”. Until that change was made, the 1999 Agreement provided that employees may have leave of absence of up to 14 days a year only “for the purpose of attending an annual training camp” with the possibility of a further four days per year if a Commanding Officer certified that such additional days were required.31

[32] The 1999 Agreement also required employees to refund to the MFB remuneration from other sources, presumably the ADF, so that their remuneration did not exceed their MFB “normal pay” for the period. In effect the 1999 Agreement appeared to safeguard an employee’s normal MFB pay for the period of their absence on ADF service while also ensuring the employee would not obtain a windfall gain from being paid both by the MFB and the ADF for the period of absence.

[33] Upon commencement of the 2002 Agreement the refund term was removed and a different provision was inserted providing that “[w]here additional days are required for the purpose of service or travelling, requests for additional time off work shall be granted.” 32

[34] In effect the earlier provision, which arguably had a somewhat confined operation of 14 days’ leave for attendance at an annual training camp, together with the possibility of a further four days if certified as being necessary by the employees’ ADF Commanding Officer, was substantially broadened. Mr Hester argues that the change in language and entitlement between the 1999 Agreement and the 2002 Agreement demonstrates an intention of the parties to do two things; to provide additional leave as well as to do so on the basis that the leave is paid. In this latter regard Mr Hester points to the use of the phraseology “time off work” as being determinative of the question of whether the leave is paid because the manner in which that term is used elsewhere within the 2002 Agreement must give rise to the view that the phrase “time off work” means “paid time off”. This submission is advanced because the terms of the 2002 Agreement incorporates an award, referred to from this point as the 2000 Award, which leads to such a conclusion;

“29. The 2002 Agreement (Clause 7), incorporated the Victorian Firefighting Industry Employees Interim Award 2000. Under the Award, the expression 'time off' is used in clause 26.2(c). It is not specified whether the time off referred to is paid or unpaid time off.

30. Specifically, the clause provides:

'At the election of the employee, time off equivalent to the period of overtime worked may be taken in lieu of receiving double rates, provided that, if the time off has not been taken within the next four pay periods, the penalty rate for the overtime will be paid.'

31. This type clause is common to many agreements and Awards and is well understood to provide for paid time off.

32. Therefore, in the specific context of the 2002 Agreement, the expression time-off, when not specified to be paid or unpaid, can be properly understood to mean paid time off.

33. The 2005 Agreement that Mr. Hester was granted leave under, as well as the 2010 Agreement currently in place, also contain terms that allow employees to receive time off instead of overtime. In both agreements,' time off' in lieu of overtime is not specified to be paid or unpaid, however it is widely and properly understood to be paid.

Legislative Context

34. The expression 'time-off' is not used or defined in legislation such as the Fair Work Act or its predecessor the Workplace Relations Act 1996 which the 2002 Agreement was negotiated under.

35. In Awards that were made under the WR Act, where the expression time-off has been used without clarification whether the time-off would be paid or unpaid, 'time off is understood to mean paid time off. See for example paragraph 30 above.” 33

[35] Counter to this argument about the meaning of the expression “time off”, the MFB submit that the way the term is used in the 2000 Award is irrelevant, since the provision referred to by Mr Hester;

“… appears in the 2000 Award in the context of overtime (where an employee receives double rates of pay) and the option of an employee taking time off in lieu of receiving double rates of pay. This clause deals specifically with payment to an employee for time actually worked, and cannot be equated to a clause which deals with a specific type of leave.” 34

[36] Mr Hester argues that these surrounding circumstances are such that the Commission should have regard to them in determining the meaning of phrasing that has been included in the three enterprise agreements from the time of the 2002 Agreement.

[37] The second limb to Mr Hester’s argument about surrounding circumstances is what amounts to an argument of custom and practice on the part of the MFB to pay other employees on ADF service at their usual rate of pay in addition to such payments as may have been made to them by the ADF.

[38] Mr Hester’s argument about custom and practice includes evidence from three other employees who are granted paid leave for the purposes of an ADF overseas deployment. 35 His submissions include the following;

“18. There is evidence that past custom and practise within the MFB has been to grant paid leave to employees released for service with the Australian Defence Force. A number of employees have provided statutory declarations as evidence that they were provided with paid leave under the clause. Copies of the statutory declarations have been provided in evidence.

19. Employees granted paid leave for extended periods of military service under the Defence Force Leave clause include the following:

• MFB Senior Station Officer Bradley Watkins was granted paid leave by the MFB whilst deployed overseas on military operations with the Australian Army between 7 February 2009 and 11 September 2009.



• MFB Firefighter Robert Dore was granted was granted paid leave by the MFB whilst deployed overseas on military operations with the Australian Army between February 2013 and December 2013.



• MFB Firefighter Afonso Lai was granted paid leave by the MFB whilst deployed overseas on military operations with the Australian Army between 9 February 2009 and 11 September 2009

20. There is at least one other example of an MFB employee being refused paid leave for a period of military service under the Defence Force Leave clause that has applied since 2002. The non-payment was subject to a dispute which was resolved on a without precedent basis without arbitration by the Fair Work Commission.

21. The MFB have now moved delegation for the approval of Defence Force leave to the office of the CEO as well as indicating that paid leave for service will not be granted in the future.” 36

[39] The MFB’s records of employees taking ADF leave are extensive, however probably not comprehensive. This is particularly given that there is, in all, a large number of employees who have taken such leave over a period that now extends for over a decade. Mr Hogan, the MFB’s Industrial Relations Consultant, gave the following evidence about participation of employees in ADF activities;

“4 MFB has identified 45 individuals (Reserve Employees) who are members of the Australian Army Reserve (Reserves). Of these, 42 are operational firefighters, and 3 are employed within the MFB’s corporate function.

5 From time to time, Reserve Employees can volunteer or be required to perform periods of duty with the Reserves. This includes periods of recruit training, initial employment training and common induction, as well as deployment rendered on a continuous, full time basis.

6 The duration of a Reserve Employee’s period of duty with the Reserves varies depending on the nature of the activities the employee is performing. For example, where a period of duty is for the purposes of Reserves training or assessment, it may only extend for one day or more, but a period of duty where the Reserve Employee is deployed on a continuous, full time basis may extend for many months.

7 During these periods of Reserve duty, Reserve Employees are unable to attend for work with the MFB at all.

8 The MFB does not become aware that a Reserve Employee will be absent from MFB duties to undertake Reserves duty, or the duration of that absence, until it receives a leave request from the employee …” 37

[40] It is clear from this evidence that participation by MFB employees in ADF service varies considerably. On the one hand there will be employees who undertake short periods of Reserve service, as well as there being other employees, perhaps a far smaller number than the first category, in which the employee embarks on more considerable service, whether because of their skills or interests.

[41] Further to the evidence referred to above, Mr Hogan accepted that there were circumstances in which employees would be granted paid leave for extended absences on ADF service which he characterised as being an erroneous approval by the relevant MFB Commander;

“15 In 2009 and 2010 (when Matthew Hester took the period of leave relevant to this dispute), a Reserve Employee who required leave under clause 63 of the Enterprise Agreement was required to complete a leave request form, and provide the form to their Station Officer in the first instance, who then provided it to the relevant regional Shift Commander.

16 In the leave request form, the Reserve Employee had to identify the purpose and period of their leave, and attach evidence demonstrating that they were required to attend for Reserves duty (typically by attaching a “Tri-Service notification”, which is a document issued to the Reserve Employee by the Australian Defence Force and states the period and purposes for which they are required to render Reserves duty). The Shift Commander would then note, on the leave request form, whether the leave was approved, and if so, whether it was to be paid or unpaid. Based on my experience with the MFB, many Commanders erroneously circled “approved” and “with pay” without checking the employee’s remaining entitlement to paid leave. The leave form was then sent to the Regional Administration and Rostering departments for processing.

17 There was no formal mechanism, or requirement, for the Commanding Officer who approved the leave request to check whether the relevant Reserve Employee had exhausted their paid leave entitlement to Defence Force leave at the time they approved the leave request and determined whether or not the leave would be with or without pay.

18 This is because the leave request form was essentially only used for the purpose of keeping a record of the leave evidence which had been submitted by the Reserve Employee, and did not impact on whether a Reserve Employee was paid for periods of leave (which leave I have been advised by the Commander in charge of rostering (Commander Rostering) may commence prior to the leave form and leave evidence being submitted to the Rostering Department or Regional Administration). Whether a Reserve Employee was paid on any particular day was determined by a different mechanism, called the “Daily shift timesheet system” (commonly known as “The Daily”), which is a computerised system on the MFB network.” 38

[42] Following his analysis of the MFB’s payroll system, Mr Hogan’s evidence included his opinion that there has been no consistent approach taken to the granting of Defence Force Leave by the MFB, and that “[t]here is no custom and practice of the MFB granting paid leave for all Reserves duties”, with him concluding with the following views;

“26 The payroll report also shows that not all Defence Force leave has been paid leave, with 4 Reserve Employees being recorded as having periods of “Military Unpaid” absence between 2009 and 2016. This includes Mr Hester and Robert Dore, both of whom are discussed further below. The two other Reserve Employees had 146 and 42 days of “Military Unpaid” absence respectively.

27 The payroll report also indicates that restrictions on entitlements to paid Defence Force leave under clause 63 of the Enterprise Agreement have not been adhered to by the Commanders approving leave applications. In particular, the report identifies that a number of Reserve Employees have been granted paid leave under clause 63.1 of the Enterprise Agreement which has been in excess of their entitlement. …” 39

[43] Finally, Mr Hogan’s evidence is that because of the situation in which the MFB found itself, approvals for Defence Force Leave involving an overseas deployment now require approval by the CEO;

“Changes to the authorisation process for overseas deployments were made around one year ago following a dispute in relation to payment for Defence Force leave involving another MFB employee. The effect of these changes is that where applications for Defence Force leave are made for the purpose of an overseas deployment, the leave request must be approved by the MFB’s Chief Executive Officer. Commanding Officers are responsible for making a recommendation on the granting of leave (rather than being responsible for its ultimate approval).” 40

[44] I do not consider that either submission, of the provisions of the 2000 Award requiring that the term “time off work” is to be read as “paid time off work”, or of custom and practice, leads to a view that the provisions of clause 63 of the 2010 Agreement contain an ambiguity. To the extent that the material brought forward by Mr Hester in relation to either argument can be put as objective evidence of surrounding circumstances, I do not consider that the evidence leads to the view that the term contains an ambiguity.

[45] The first contention, of the provisions of the 2000 Award leading to the proposition that the time off must be paid time off, falls upon an analysis of the award’s content.

[46] The relationship which the 2000 Award has with the 2010 Agreement is expressed in clause 8, as follows (which refers to the award as the VFIEI Award);

“8. RELATIONSHIP TO PARENT AWARD AND CERTIFIED AGREEMENTS

8.1. This Agreement is to be read and interpreted wholly in conjunction with the VFIEI Award as varied from time to time, provided that:

8.1.1. where there is any inconsistency between this Agreement and the VFIEI Award this Agreement will take precedence; and

8.1.2. where the Agreement and the VFIEI Award deal with the same matter this Agreement will take precedence.”

[Clause 8.2 and 8.3 not reproduced]

[47] This is a broadly similar relationship to that expressed in the 2002 Agreement and the 2005 Agreement, 41 although the language of incorporation has changed upon the making of each agreement, and the specific formulation of clause 8.1.2 is not used in the earlier agreements. Notwithstanding these differences, the form and purpose of incorporation of the Award into each enterprise agreement is not relevant to the disposition of this matter.

[48] Instead, what is relevant is the language to which Mr Hester and the UFU draw attention. They contend that Part One of the 2000 Award, which sets out conditions applying to the MFB, uses the term “time off” in a precise manner which requires that construction of the same term used within the 2010 Agreement is on the basis of the term having the same meaning as within the 2000 Award. The basis of this contention is the way the term is used within clause 16, now reproduced in full;

“16. OVERTIME, RECALL AND RETENTION

16.1 Overtime

16.1.1 Except as provided for in 16.2 and 16.3, all times worked by an employee in excess of the day’s rostered shift, or for more than four shifts in any one week, shall be paid for at the rate of double time, calculated to the nearest quarter of an hour.

16.1.2 At the election of the employee, time off equivalent to the period of overtime worked may be taken in lieu of receiving double rates, provided that if the time off has not been taken within the next four pay periods, the penalty rate for the overtime will be paid.

16.2 Recall

16.2.1 An employee off duty, who is recalled to duty, shall be paid a minimum of four hours at double time, provided that if the work to be done is completed within four hours, the employee need not stay for the full four hours.

16.2.2 An employee recalled to duty shall be paid travelling time, at ordinary rates, except on Sundays and public holidays when time and one half apply. In addition a payment of 72.3 cents per kilometre or part thereof, shall be made in respect of the distance travelled from home to work and return.

16.3 Retention

16.3.1 An employee on shift work who is retained on duty, at the conclusion of a rostered shift for 60 minutes or more (excluding shower and change time) and who has not been given at least 24 hours prior notice shall be paid a minimum of four hours at double time, provided that if the work to be done is completed within four hours, the employee need not stay for the full four hours.

16.3.2 An employee retained on duty after a night shift, shall be entitled to eight consecutive hours off duty, without loss of pay for ordinary working time.” (emphasis added)

[49] Mr Hester’s submission is that the underlined term in clause 16.1.2 is a common one in many agreements and awards, and that the phrase “time off” is understood to mean “paid time off”. 42 While that may be so, and I make no finding about the accuracy of the submission, the context of the clause in the 2000 Award is completely different to the context of the Defence Force Leave clause.

[50] The fact that the 2000 Award uses the term in one particular context adds nothing to the meaning of the phrase as it is used within the Defence Force Leave Clause. The phrase may have work to do in relation to interpretation of the overtime provisions within the enterprise agreement, but it draws too long a bow to suggest there is an axiom between the use of that phrase in one context within the 2000 Award, and the same phrase within another context in the 2010 Agreement. Merely because the phrase “time off” is understood to mean “paid time off” within the context of time off in lieu of the payment of overtime, being a monetary payment foregone for overtime actually worked through the compensation of time away from work with one’s family, etc., does not lead to a finding that being granted “time off work” for the purposes of additional days’ Defence Force Leave must be on the basis of it being “paid time off”.

[51] The second limb of the Applicant’s case is that custom and practice dictates the correct meaning of the clause being that the leave is paid. The argument of custom and practice relies upon two factors. The first is that until the 2002 Agreement there had been a specific provision that an employee would only be paid the total of their MFB normal pay and that amounts above that level would be refunded to the MFB. The second factor is that payments made to employees since the making of the 2002 Agreement demonstrate that employees have been paid fully, even for extended periods, by the MFB without them being required to refund any windfall gain to anyone, or to take periods of leave unpaid by the MFB.

[52] Reference was also made to the fact that the 2010 Agreement could have, but did not allow for, suspension of an employee’s contract of employment during an employee’s period of defence service; see Defence Reserve Service (Protection) Act 2001 (Cth), ss.26, 27, 28.

[53] In relation to the argument of custom and practice, I accept Mr Hogan’s evidence that there has been no consistent approach taken to the granting of Defence Force Leave by the MFB, and that “[t]here is no custom and practice of the MFB granting paid leave for all Reserves duties”. 43 Approvals and payments to employees for periods of Defence Force Leave have varied; likely because the authorising managers have taken different approaches.

[54] Accordingly, there is no custom and practice that would dictate how the provision should be constructed.

[55] Because of this, the provision within the 2010 Agreement contains no ambiguity and should be accorded its plain meaning.

[56] The clause sets out the following provisions;

“63. DEFENCE FORCE LEAVE

63.1. Leave of absence with pay may be granted for fourteen days in any year to any employee who is a voluntary member of the Reserve Forces for the purpose of attending an annual training camp, and a further four days a year for the same purpose on the certification of the Commanding Officer of the particular service unit concerned that such additional days are required.

63.2. Where additional days are required for the purpose of service or travelling, requests for additional time off work shall be granted.”

[57] I am satisfied that the plain meaning of clause 63.1 is to provide an annual entitlement of leave in order to attend an annual training camp. The clause is explicit that the leave is “leave of absence with pay”. The entitlement is capped to 14 days per year, with the possibility of a further 4 days per year, once certified as required by the Defence Force Commanding Officer.

[58] I am satisfied that clause 63.2 allows for the grant of additional days, if those days are required for the purpose of defence service or the purpose of travelling. Once those thresholds have been met, time off work shall be granted. Without there being a requirement in that clause for the time off to be paid, the additional time off is to be leave of absence without pay.

CONCLUSION

[59] For the reasons set out above, I resolve the questions for determination, posed by me above, in the following way;

Q: Is the MFB required to provide Matthew Hester with payment of his ordinary wages for the period between 29 October 2009 and 14 April 2010 where he was granted unpaid Military Service Leave?

A: No.

Q: Is the MFB required to re-credit all Annual Leave taken by Mr. Hester between 3 September 2009 and 28 October 2009 to his Annual Leave balance?

A: No.

COMMISSIONER

Appearances:

J McKenna of Counsel for the Applicant.

M Felman of Counsel for the MFB.

Hearing details:

2016.

Melbourne:

July 26.

Final written submissions:

Applicant, 9 August 2016

Respondent, 2 August 2016

 1   AE881005.

 2   Exhibit MFB 1, Respondent’s Outline of Submissions, [15].

 3   Exhibit UFU 3, as amended.

 4   AG848710.

 5   Ibid cl 12.1.

 6   Applicant’s Note on Jurisdiction, 9 August 2016.

 7 Exhibit MFB 1, Respondent's Outline of Submissions, [11]-[12].

 8   Construction, Forestry, Mining and Energy Union v The Australian Industrial Relations Commission [2001] HCA 16; (2001) 203 CLR 645 [30]–[32]; cited in Endeavour Energy v Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia [2016] FCAFC 82, at [25].

 9   Construction, Forestry, Mining and Energy Union v Wagstaff Piling Pty Ltd [2012] FCAFC 87 [21]; cited in Kentz (Australia) Pty Ltd v Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia[2016] FWCFB 2019 [52].

 10   CEPU v Thiess Pty Ltd (2011) 212 IR 327 at [42], [47]; CFMEU v AIRC [2001] HCA 16.

 11   SDA v Big W Discount Department Stores PR924554 at [23].

 12   AMWU v Holden Limited PR940366 at [47]; MUA v ASP Shipping Management Pty Ltd[2015] FWC 4523 at [23].

 13   Ibid.

 14   MUA v ASP Shipping Management Pty Ltd[2015] FWC 4523 at [19], [23]; R v Bain; Ex parte Cadbury Schweppes Australia Ltd (1984) 159 163 at 168; United Firefighters’ Union v Metropolitan Fire and Emergency Services Board PR973884.

 15   MUA v Australian Plant Services Pty Ltd PR908236; MUA v ASP Shipping Management Pty Ltd[2015] FWC 4523 at [21]-[22].

 16   United Firefighters’ Union v Metropolitan Fire and Emergency Services Board PR973884 at [20].

 17   The Commission must not make a decision that is inconsistent with the Act, or a fair work instrument that applies to the parties.

 18   MUA v Australian Plant Services Pty Ltd PR908236 at [63]; Seven Network (Operations) Ltd v CPSU (2003) 122 IR 97 at [31]-[32].

 19   CFMEU v AIRC (2001) 203 CLR 645 at [32]; Linfox Australia Pty Ltd v TWU [2013] FCA 659 at [19]-[24]; AMWU v ALS Industrial Australia Pty Ltd [2015] FCAFC 123 at [34]-[36].

 20   AMWU v ALS Industrial Australia Pty Ltd [2015] FCAFC 123 at [36].

 21   [2014] FWCFB 7447.

 22   the Acts Interpretation Act 1901 (Cth).

 23   Metropolitan Fire and Emergency Services Board, United Firefighters Union of Australia, Operational Staff Agreement 1999, AG790039.

 24   Ibid cl 41.

 25   Metropolitan Fire and Emergency Services Board, United Firefighters Union of Australia, Operational Staff Agreement 2002, AG819934.

 26   Ibid cl 44.

 27   AG848710 cl 45.

 28   AE881005 cl 63.

 29 Exhibit MFB 1 [12].

 30   Exhibit UFU 4, Applicant’s Outline of Submissions, [17].

 31   AG790039 cl 41.

 32   AG819934 cl 44.

 33   Exhibit UFU 4 [29]-[35].

 34 Exhibit MFB 1 [43].

 35   Exhibit UFU 2, Statutory Declarations of Alfonso Lai, Robert Dore and Bradley Watkins.

 36   Exhibit UFU 4 [18]-[21].

 37 Exhibit MFB 2, Witness Statement of Aaron Hogan, [4]-[8].

 38   Ibid [15]-[18].

 39   Ibid [26]-[27].

 40 Ibid [22].

 41   AG819934 cl 7; AG848710 cl 7.

 42 Exhibit UFU 4 [31].

 43 Exhibit MFB 2 [25].

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