Minebiz Pty Ltd v Codey
[2015] FCA 372
•24 April 2015
FEDERAL COURT OF AUSTRALIA
Minebiz Pty Ltd v Codey [2015] FCA 372
Citation: Minebiz Pty Ltd v Codey [2015] FCA 372 Appeal from: Codey v Minebiz Pty Ltd (Local Court of New South Wales, No. 2013/356509, 12 August 2014) Parties: MINEBIZ PTY LTD v SCOTT CODEY File number(s): NSD 901 of 2014 Judge(s): BUCHANAN J Date of judgment: 24 April 2015 Catchwords: INDUSTRIAL LAW – appeal from Local Court of New South Wales under the Fair Work Act 2009 (Cth) – allegation of underpayment of wages under an enterprise agreement – whether employee correctly classified under the enterprise agreement as a ‘Surface Operator’ – whether classification structure in enterprise agreement is referrable to classifications set out in the Mining Industry Award 2010 – whether respondent discharged onus of proof to show relevant employment designation as an ‘Underground Mine Employee’ Legislation: Evidence Act 1995 (Cth), s 140(2)
Fair Work Act 2009 (Cth), ss 54(1)(a), 189, 546, 570
Mining Industry Award 2010 (Cth), cll 1, 2.1, 4.1, 4.2, 13, 13.1(a), 13.1(b), 14.2(a), Sch B.1.2, B.2.2, B.2.4, B.3, B.3.3Minebiz Pty Ltd Enterprise Agreement 2010, cll 2.4, 2.5, 3.1, 4.1, Sch 1
Cases cited: Abalos v Australian Postal Commission (1990) 171 CLR 167
Bell IXL Investments Ltd v Life Therapeutics Ltd (2008) 68 ACSR 154
Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1
Cabal v United Mexican States (2001) 108 FCR 311
Devries v Australian National Railways Commission (1993) 177 CLR 472
Luxton v Vines (1952) 85 CLR 352
State Rail Authority of New South Wales v Earthline Constructions Pty Ltd (in liq) (1999) 73 ALJR 306; (1999) 160 ALR 588
Tisdall v Webber (2011) 193 FCR 260
Warren v Coombes (1979) 142 CLR 531Date of hearing: 2, 30 March 2015 Place: Sydney Division: FAIR WORK DIVISION Category: Catchwords Number of paragraphs: 73 Counsel for the Appellant: Mr I Taylor SC with Mr O Fagir Solicitor for the Appellant: Campbell Paton & Taylor Counsel for the Respondent: Mr M Gibian Solicitor for the Respondent: Australian Workers’ Union
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
FAIR WORK DIVISION
NSD 901 of 2014
ON APPEAL FROM THE LOCAL COURT OF NEW SOUTH WALES
BETWEEN: MINEBIZ PTY LTD
AppellantAND: SCOTT CODEY
Respondent
JUDGE:
BUCHANAN J
DATE OF ORDER:
24 April 2015
WHERE MADE:
SYDNEY
THE COURT ORDERS THAT:
1.The appeal be allowed.
2.The orders of the Local Court of New South Wales made on 12 August 2014 be set aside and, in their place, it be ordered that the application to that Court be dismissed.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
FAIR WORK DIVISION
NSD 901 of 2014
ON APPEAL FROM THE LOCAL COURT OF NEW SOUTH WALES
BETWEEN: MINEBIZ PTY LTD
AppellantAND: SCOTT CODEY
Respondent
JUDGE:
BUCHANAN J
DATE:
24 April 2015
PLACE:
SYDNEY
REASONS FOR JUDGMENT
Background
This judgment deals with an appeal from the Local Court of New South Wales. The proceedings in the Local Court were commenced by application relying on provisions of the Fair Work Act 2009 (Cth) (“the FW Act”), and sought an amount of $13,755 for “outstanding entitlements”, together with interest and also penalties under s 546 of the FW Act for breach of a civil penalty provision.
The application was based on the contention that the appellant (Minebiz) had breached the Minebiz Pty Ltd Enterprise Agreement 2010 (“Minebiz Agreement”) (an enterprise agreement made under the FW Act) by failing to pay Mr Codey his entitlements under the agreement.
The Local Court upheld the claim in part, awarded Mr Codey $10,239 for unpaid wages, made orders for the payment of interest, imposed a pecuniary penalty of $11,000 (one-third of the maximum penalty of $33,000) and ordered court costs of $113. Each aspect of the orders has been appealed. The fundamental basis of the appeal is that the Local Court was wrong to conclude that Mr Codey had been underpaid but, in the alternative, it was contended that the penalty was excessive and that there was, in any event, no power to order the payment of any amount of costs.
The last contention was accepted on the appeal as one which should be upheld under s 570 of the FW Act. I doubt that “court costs” fall within the protection in s 570 of the FW Act. Neither Minebiz nor Mr Codey addressed that issue. It will assume no ultimate importance.
The employment context
Minebiz was a labour hire company. It ceased trading on 31 January 2014. In the case of Mr Codey’s employment, his services as a casual employee were provided to a Boral company which, in turn, provided concrete batching and delivery services to Newcrest Mining Limited at its Cadia Valley gold mine operation. The Cadia Valley operation consisted, at the relevant time, of three mines: the Cadia Hill open pit mine, the Cadia East underground mine and the Ridgeway underground mine. Mr Codey’s services were provided by Minebiz, and thence by Boral, at the Ridgeway underground mine which had both surface and underground operations. The surface operation included a concrete batching plant, from which concrete was delivered underground. Underground, the concrete was poured, in part at least, to lay down roads in the underground mine. Apart from the delivery function which was accomplished by drivers, there was a delivery co-ordination function in which Mr Codey played a role in the later part of his employment by Minebiz.
Mr Codey was employed by Minebiz from 14 November 2010 to 8 October 2011. Then he was employed directly by Boral, but that employment is outside the scope of the proceedings.
The Minebiz Agreement was approved by the Fair Work Commission (“the FWC”) on 11 November 2010 and commenced to operate on 18 November 2010, pursuant to s 54(1)(a) of the FW Act. An earlier form of the agreement was refused approval by the FWC because it was insufficiently specific or detailed about some matters. Although it was referred to in the submissions on the appeal, its proposed terms were not shown to have any particular or direct relationship with the terms of the Minebiz Agreement which took formal effect on 18 November 2010. There is no reason to think, therefore that more than passing reference need be made on the appeal to that earlier document.
Mr Codey’s evidence to the Local Court was that in October 2010, he responded to an advertisement from Minebiz “seeking qualified truck drivers” and “completed the paperwork shortly afterwards”. He was assessed for competence by a Boral employee who, apparently, also inducted him into operating and safety procedures at the mine. He worked on a shift roster cycle of generally four shifts on and four shifts off thereafter.
Mr Codey’s duties
Mr Codey’s initial affidavit evidence about his duties included the following:
14.My work initially involved driving various sizes of concrete trucks.
15.The concrete would be loaded at the batching plant on the surface and we would then deliver it underground to various areas of the mine.
16.This included pouring concrete used for laying roads so other plant and machinery could operate more effectively underground.
17.After a few months Ray Barlow, a Boral Manager, approached me about an underground coordinator role. I indicated I was interested in the role and started shortly afterwards.
18.The underground coordinator role was basically to coordinate the movements of concrete agitator trucks on the surface and underground.
Minebiz filed an affidavit in response by Mr Barlow. Mr Barlow was not called to give oral evidence. Mr Barlow’s affidavit evidence was said by the Local Court to display some partisanship towards the position of Minebiz. It was, for that reason, not preferred over Mr Codey’s evidence but it contains, nevertheless, some relevant and effectively uncontested material.
In his initial affidavit, Mr Codey did not refer to the fact that the role of “underground co‑ordinator” was not a permanent or full-time one, nor that he secured a payment equivalent to six hours extra pay (half a shift) each week when he performed the role. Mr Barlow’s affidavit evidence, however, showed that Mr Codey performed a role of “co-ordinator” (he did not adopt the term “underground co-ordinator”) in about two-thirds of the weeks from 1 May 2011 (i.e. 16 out of 23 weeks) until his employment with Minebiz ended on 8 October 2011. In those weeks he received an extra six hours pay. In an affidavit in reply, Mr Codey also referred to this role as “co-ordinator”, rather than “underground co‑ordinator”.
The Local Court assessed the work performed by Mr Codey as co-ordinator as work to which the Minebiz Agreement did not apply. The Local Court found in substance, that regardless of the co-ordinator role, Mr Codey’s classification under the Minebiz Agreement had remained unchanged throughout his employment. That conclusion was consistent with the fact that, apart from the extra six hours per week pay when Mr Codey acted as a co-ordinator, his rate of pay remained constant from the second week of his employment at $35 per hour, but it left for decision the question of whether he was correctly classified and paid under the Minebiz Agreement.
Mr Barlow’s affidavit sought to limit the range of duties performed by Mr Codey as follows:
6.Mr Codey was engaged to perform work as an agitator truck driver. During the course of his working at the Cadia mine for Minebiz, he was employed to drive an agitator concrete truck. He did not drive any other equipment or machinery, with the exception of a light vehicle that he drove from the surface to the underground area of the mine where he performed his work as an agitator truck driver.
Mr Codey responded as follows:
2.At paragraph [6] Mr Barlow states that I only drove an agitator concrete truck and a light vehicle.
3.This is incorrect. I also drove the following machinery during my employment with Minebiz:
- 18 wheeler semi-trailer concrete truck;
- Standard 10 wheeler Freightliner concrete truck;
- Caterpillar Articulated 730 concrete truck; and
- IT Loader.
…
4.At paragraph [7] Mr Barlow claims I was never assessed as competent to carry out any work other than as an agitator truck driver.
5.This statement is confusing because Mr Barlow knowingly allowed me to drive the machinery identified above. If he was not satisfied that I was competent, I don’t know why he allowed me to operate the machinery.
6.Boral and Minebiz employees did assess that I was competent to drive the Freightliner and the Cat 730 and because I hold a MC (multi-combination class) licence I was deemed as competent and trusted by Mr Barlow to drive the 18 wheeler semi-trailer.
7.In relation to the IT Loader, I and a number of Boral and Minebiz employees asked on numerous occasions to be formally assessed in relation to driving this machine but Mr Barlow indicated “there’s no need, I have watched you and you can operate it safely”. I currently hold an 18c Loader ticket.
The references to assessment are relevant to matters yet to be discussed. Mr Codey’s case before the Local Court was that his assessed competence on a range of “plant and equipment functions” entitled him to a higher rate of pay than he was given. Detailed discussion of that contention must be deferred for the moment. However, it is convenient to mention here that there was evidence before the Local Court that during his employment by Minebiz Mr Codey was formally assessed as competent by Boral, in accordance with “CVO [Cadia Valley Operations] Safe Work Procedures and the relevant National Competency Standards”, with respect to “Conduct Underground Truck Operations” on two different concrete agitator trucks – a Caterpillar 730 (8 m3) and a Freightliner FL80/112 (6 m3). Later, at Cadia East underground mine, and probably in the period of employment with Boral, Mr Codey was also assessed as competent on a Mercedes-Benz Axor (4 m3) agitator truck.
Mr Codey explained in his oral evidence that the Caterpillar and Freightliner trucks required different operational skills, including when cornering and backing. He said also he had operated the Caterpillar front end loader 30 to 40 times.
Mr Codey’s affidavit evidence, to which I have already referred, made it clear that work involving the two concrete agitator trucks involved loading at the batching plant on the surface and then delivering the concrete underground and discharging the truck. On one occasion, Mr Codey said that he had initiated the return of an agitator truck he was driving to the surface, without discharge, because the bowl had stopped turning and he feared the concrete would set. That evidence was relied on to support an assertion that he had exercised some initiative in his duties and deserved classification at a higher level than he was paid.
The semi-trailer driving appears to have been on the surface. The loader was “never, never driven underground”, he said.
The origins of the co-ordinator responsibility was described by Mr Codey as follows:
11.… A few months after I started working at the Cadia Valley mine Mr Barlow stated to Paul Torrens (Minebiz employee) and I that Newcrest were looking at a way of speeding up the delivery of both civil and shot-crete concrete loads on the surface and underground. …
Mr Barlow said:
9.After a some time, I asked Mr Codey to fill in as a co-ordinator. This involved him co-ordinating the movement of Boral trucks that were delivering concrete underground in the mine. In doing this, I would tell him what work needed to occur and he would direct trucks to pick up and drop off concrete. He sat in a truck doing this work and used the radio in the truck to communicate with other drivers.
10.This co-ordinating role was, in my view, far less strenuous than his agitator truck driving role. He performed this role from time to time as required and as directed by me.
11.I arranged for him to be paid an additional 6 hours a week for when he performed this co-ordinating role. I did not inform Minebiz of this initially, but later told them about this arrangement.
Mr Codey responded in his affidavit:
15.At paragraph [9], Mr Barlow states I sat in a truck doing this work and simply used the radio to communicate with other drivers.
16.This is incorrect. Never once did I just sit in my truck doing the co‑ordinating work.
17.I would constantly travel around the mine site checking that everything was progressing as planned and offering assistance to employees as required.
18.At paragraph [10] Mr Barlow claims the co-ordinator role was far less strenuous that driving agitator trucks.
19.Whilst this may be correct in terms of physical exertion, the co-ordinator role was very stressful and carried a large amount of responsibility.
20.Paul and I were held accountable for the ordering and movement of agitator trucks, the health and safety of relevant staff underground, complying with constant orders from Stratacrete for shot-crete and from construction supervisors for civil pours, monitoring all the pours and constantly talking with shift bosses about three different work areas at the mine.
21.We were provided with a 4 wheel-drive troop vehicle to drive around all areas of the mine at our own discretion to co-ordinate all of these activities.
22.At paragraph [11] Mr Barlow states we were paid an extra six hours per week for performing the co-ordinator role.
23.There was never any discussion about this arrangement. Mr Barlow commented that he would “make it worthwhile” for us when we started in the role.
As I said earlier, Mr Codey’s actual hourly rate was $35 per hour except for the first week of his employment. His payslips provide virtually the only documentary evidence from Minebiz of anything approaching a formal record relating to his employment. There was no position description in evidence, no copy of any advertisement of the position, no letter of appointment, no designation of whether he was an underground or surface employee (an important distinction as will be seen) and no specification of which level he was employed at.
Three payslips will illustrate the only changes made in that part of Minebiz’s records, apart from variations in total amounts reflecting hours actually worked and the extra six hours pay for performing the role of co-ordinator. Those payslips are the first, the second and the payslip from the week commencing 10 July 2011:
Evidently, in the second week Mr Codey worked six shifts. The third payslip reflects four shifts plus the extra six hours payment for the co-ordinator role. I need also to make a number of further observations about what those payslips show, and do not show. The observations deal with four matters.
First, every payslip shows an “Annual Salary” of $65,208.00. Every payslip shows an “Hourly Rate” of $33 (which corresponds to the Annual Salary based on a 38-hour week). Those two figures do not appear to have any real significance. Mr Codey was a casual employee. He was not on an annual salary. Apart from the first week of his employment his hourly rate was not $33.
Secondly, from the second week of his employment the “Calc. Rate” was $35. This was the hourly rate actually paid from 21 November 2010 to 8 October 2011. It corresponds with two positions in the Minebiz Agreement. Those two positions, as will be seen, are the two lower levels (of two only) for surface and underground employees. Mr Codey’s case was that he was entitled to the higher of the rates for underground employees ($40.25 per hour).
Thirdly, no “Employment Classification” is stated on any payslip.
To this point, the picture is complete by referring only to the first two payslips. The only change (from $33 to $35 as the effective hourly rate) reflects the formal commencement of the Minebiz Agreement.
The fourth matter worthy of mention arises from the payslip for the week commencing 10 July 2011. To this point, the descriptions of the different accounting elements corresponding to “Wages”, “Tax” and “Superannuation Expenses” at the bottom of the payslip were “Ridgeway Underground”, “PAYG Withholding” and “Superannuation Guarantee”. From 10 July 2011 “Ridgeway Underground” was replaced with “Boral Underground”. There was no explanation of that change in the evidence.
The Local Court saw in the entry “Ridgeway Underground’ some support for Mr Codey’s assertion that he was an underground employee but, in my respectful view, no inference to that effect properly arises from the entry. The suggestion is purely speculative. It might as readily refer to the place of employment. The change to “Boral Underground” takes the matter no further. It might as easily refer to Boral employees whose labour was provided at one of the two underground mines (Cadia East and Ridgeway) without signifying that the particular employees were underground rather than surface employees.
A court may not make evidentiary assumptions which substitute speculation and guesswork for a proper process of inference (see Luxton v Vines (1952) 85 CLR 352 at 358, quoting Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1; Bell IXL Investments Ltd v Life Therapeutics Ltd (2008) 68 ACSR 154 at [14]; Tisdall v Webber (2011) 193 FCR 260 at [127]-[130]). Although an appeal court must give appropriate weight to the findings of fact at first instance, the same considerations do not apply to findings which are simply inferences to be drawn from facts which are undisputed (see Cabal v United Mexican States (2001) 108 FCR 311 at [223], citing Warren v Coombes (1979) 142 CLR 531, Abalos v Australian Postal Commission (1990) 171 CLR 167, Devries v Australian National Railways Commission (1993) 177 CLR 472 and State Rail Authority of New South Wales v Earthline Constructions Pty Ltd (in liq) (1999) 73 ALJR 306; (1999) 160 ALR 588).
The proceedings before the Local Court did not just concern a pay claim. They also concerned an accusation of breach of a civil penalty provision. A pecuniary penalty was imposed. In my view, having regard to s 140(2) of the Evidence Act 1995 (Cth), the payslip entry was an unreliable and insufficient foundation for the conclusion of the Local Court that:
7.The respondent’s payroll advice in respect of the applicant records ‘Description Ridgeway Underground’. I am satisfied that is a designation that the applicant was an underground mine employee for the purpose of Schedule B to the Award.
The conclusion that Mr Codey was “an underground mine employee” was a fundamental one to the reasoning which followed. When added to a further conclusion that Mr Codey was a “level 2” employee, the consequence was that his claim succeeded. Had either conclusion not been reached the claim would have failed. I will examine both in a little more detail but, as will be seen, as the evidence does not sustain a conclusion that Mr Codey was an underground mine employee on any other foundation the appeal must, for that reason alone, be upheld.
When the Local Court, having concluded that Mr Codey was an “underground mine employee”, turned to examine what his appropriate “level” was, it undertook that examination by using definitions in the Mining Industry Award 2010 (Cth) (“the Award”) to which it will be necessary to return. The examination of Mr Codey’s proper level proceeded by reference to Mr Codey’s skills and qualifications as a truck driver. As will be seen, in my view, reference to matters of that kind was not relevant to an examination of whether Mr Codey was a level 2 (or level 1) underground mine employee as contemplated by the Award.
At this point, therefore, the Local Court made a further error. The first error was the most significant, but correction of either error will require the appeal to be upheld.
It is convenient at this point to deal with the relevance of the formal assessments on the two different agitator trucks. Each assessment consisted of two parts – a theory assessment and a practical assessment. Both theory assessments occurred on 29 November 2010, about two weeks after Mr Codey commenced his employment and during the general period of his induction. The three elements assessed were: Overview, Pre-start and Operating. The content of the assessment is unknown.
The practical assessments occurred at different times. Again, the content, and indeed the circumstances, are unknown. The Freightliner practical assessment occurred on 30 November 2010, the day after the theory assessment. The Caterpillar practical assessment occurred on 3 February 2011. It is unclear whether Mr Codey drove the Caterpillar agitator truck before being formally assessed as competent, but it probably does not matter for present purposes. There is no suggestion that Mr Codey’s classification altered as a result of any assessment or group of assessments. He was paid at the same rate from the beginning of his employment. Even if Mr Codey did not drive the Caterpillar truck until formally assessed (and that is by no means clear), that was not suggested to be a matter which altered his classification when it happened.
The findings of the Local Court about underpayment related to the whole period of employment with Minebiz. It is, therefore, implicit in these findings that there was no alteration to Mr Codey’s substantive classification during his employment by reason of any of the formal assessments and that there had not been (apart from performing duties as a co‑ordinator) any relevant change to his duties or responsibilities. That approach has not been challenged.
What required assessment by the Local Court, therefore, was Mr Codey’s correct classification from the time the Minebiz Agreement commenced to apply to him, four days after he commenced employment.
The Local Court identified the question for decision as follows:
5.The Agreement did not contain any definitions of the classifications listed in schedule one nor any job descriptions. Neither party called documentary evidence of the applicant’s job description. The parties’ agree that the question for decision is whether the applicant satisfies the description of a level 2 employee as set out in schedule B clause 3.3 of the Award.
In my respectful view, that distillation is incomplete in a number of respects.
First, because there was no case advanced by him that Mr Codey’s true classification or legal entitlements changed during his employment, what required attention was his proper classification from the outset of his employment.
Secondly, although it may (for reasons I will discuss) have been open to examine whether Mr Codey was properly regarded as a “level 2 employee” under a different instrument (an award), the real focus of attention should have been on the Minebiz Agreement. More fundamental, however, was whether Mr Codey was an underground employee. If he was not, the question of level 2 employment was irrelevant.
To explain those matters it is necessary to look in detail at parts of the Minebiz Agreement as well as the Award to which the Local Court referred.
The Agreement and Award
The following clauses, and Schedule 1, are the parts of the Minebiz Agreement which are directly relevant:
2. Title, Application and Relationship to Awards
…
2.4This Agreement shall operate in the state of New South Wales where employees are employed by the Company in a position listed in Schedule One hereof.
2.5This Agreement shall be the sole document covering the terms and conditions of employment for employees covered by the Agreement to the exclusion of all other awards, agreements or common law contracts.
…
3. Position and Location
3.1Employees will be employed in a position specified in Schedule One. An employee will be required to fulfil any tasks specified in their job description or as directed by their supervisor, provided that they are within their range of skills, qualifications, competence and training.
…
4. Remuneration
4.1The rate of pay for all work performed under this Agreement is set out in Schedule One. …
Schedule One
CLASSIFICATIONS and AWARD LEVEL Casual Rate. All inclusive $ per hour
DAY
SHIFT
Surface Operator
(Surface Mining Level 2)
$30.00
$35.00
Surface Operator
(Surface Mining Level 3)
$35.00
$40.25
Underground Operator
(Underground Mine Level 1)
$30.00
$35.00
Underground Operator
(Underground Mine Level 2)
$35.00
$40.25
Labourer 1
(Service Level 1)
$24.00
$27.96
Forklift/Store
(Service Level 1)
$26.00
$30.30
Confined Space Sentry
(Service Level 1)
$25.00
$29.15
Fitter
(Maintenance Trade Level 5)
$30.00
$35.00
Boilermaker
(Maintenance Trade Level 5)
$30.00
$35.00
Leading Hand
$28.00
$32.62
Control Room Operator
Mining Services – Level 2
$28.00
$30.50
*plus 4.4% - 7.53% of base rate, depending on number of employees led.
The above schedule of rates will be reviewed on an annual basis in consideration of industry standards and business requirements
In the Local Court, the parties reached an agreement which was accepted by the Local Court which was recorded as follows:
2.… Pursuant to clause 2.5 of the Agreement, the agreement is the sole document covering the terms and conditions of employment for employees covered by the agreement to the exclusion of all other awards, agreements or common law contracts. Notwithstanding clause 2.5, the case has been conducted by the parties on the basis that it is permissible to refer to the Mining Industry Award 2010 (the Award) to classify the applicant’s employment under schedule one to the Agreement. I shall accept the parties’ concession and decide the case as argued.
At the hearing of the appeal I raised with the parties the reliability of this agreement. I did so because of important differences between the classification structure reflected in the Minebiz Agreement and that in the Award. As a result, Minebiz withdrew from some aspects of its earlier position.
As the present case involves the imposition of pecuniary penalties for breach of civil remedy provisions, I regard it as important that I reach my own view about the proper construction of the Minebiz Agreement, regardless of any position taken by the parties on the question of construction of that agreement at first instance. Before I explore those matters further, I will set out the parts of the Award which might be relevant. First, the application and scope of the Award should be identified:
1. Title
This award is the Mining Industry Award 2010.
2. Commencement and transitional
…
2.1This award commences on 1 January 2010.
…
4. Coverage
…
4.1This industry award covers employers throughout Australia who are engaged in the mining industry in respect of work by their employees in a classification in this award and their employees engaged in the classifications listed in clause 13—Classifications and minimum wage rates, of this award, to the exclusion of any other modern award.
4.2 Definition of mining industry
…
For the purposes of this clause mining industry means:
(a)extracting any of the following from the earth by any manner or method including exploration, prospecting, development and land clearing, preparatory work and rehabilitation during the life of the mine:
(i)any metals, minerals or ores;
(ii)phosphates and gemstones;
(iii)mineral sands;
(iv)uranium and other radioactive substances;
(b)the processing, smelting and refining of the metals, minerals, ores or substances covered by clause 4.2(a);
(c)the transportation, handling and loading of any of the metals, minerals, ores or substances covered by clause 4.2(a) on a mining lease or tenement;
(d)the transportation, handling and loading of any of the metals, minerals, ores or substances covered by clause 4.2(a) by the mine operator, a related company or an entity principally engaged by the mine operator to do such work, using the plant or infrastructure (including rail and/or ports) of the mine operator or a related company;
(e)the servicing, maintaining (including mechanical, electrical, fabricating or engineering) or repairing of plant and equipment used in the activities set out in clauses 4.2(a) to (d) by employees principally employed to perform work on an ongoing basis at a location where the activities described above are being performed; or
(f)the provision of temporary labour services used in the activities set out in clauses 4.2(a) to (e), by temporary labour personnel principally engaged to perform work at a location where the activities described above are being performed.
It will be seen shortly that I am prepared to accept that the Minebiz Agreement uses the Award as a point of reference. It will be important to identify how that is done and to what extent it is relevant to the present case. However, were it not for the use of that drafting technique, which was obviously adopted to satisfy the FWC about the BOOT (Better off overall test) requirements of the FW Act (see s 189) by providing such a reference point, I have real doubt that the Award could have any application to Mr Codey whose services were supplied to Boral. Boral, and the services it provided (a batching plant and concrete delivery) do not appear to me, at present, to fall within the activities referred to in cl 4.2 of the Award at all. However, it is not necessary to pursue that matter further.
The remaining references to the Award which need to be made are as follows:
13. Classifications and minimum wage rates
…
13.1 Adult employees
…
(a)A full-time adult employee must be paid a minimum weekly rate for their classification as set out in the table below:
Level
Classification
Minimum weekly rate
$
[rates when Agreement commenced]
Entry Level
Introductory
591.00
Level 1
Basic
620.00
Level 2
Intermediate
644.00
Level 3
Competent
663.60
Level 4
Advanced
708.00
Level 5
Advanced specialist
754.00
Level 6
Dual Trade
791.00
Level 7
Dual Trade Instrumentation
823.00
(b)The classification structure and descriptors for the above classifications are contained in Schedule B—Classification and Structure.
14. Allowances
…
14.2Allowances for responsibilities or skills that are not taken into account in rates of pay
(a) Leading hand
A leading hand must be paid a weekly allowance of:
In charge of
% of standard rate
3–10 employees
4.40
11–20 employees
5.60
More than 20 employees
7.53
Schedule B—Classification and Structure
…
B.1 Classification and progression principles
…
B.1.2 Progression
An employee will progress through the classification levels subject to:
(a)possessing the applicable skills for the level; and
(b)being required by the employer to perform work at that level.
Progression from Level 4 and above will be subject to the employee being appointed by the employer.
B.2 Classification groups
…
B.2.2 Mining Industry Surface Mining and Haulage Employees
A Mining Industry Surface Mining and Haulage Employee is designated as such by their employer and performs all tasks as directed by their employer which include but are not limited to: open cut mining activities (including labouring, sampling, spotting); operating all forms of mining industry plant and equipment (including mobile plant); operating equipment used in the transportation handling and loading (or discharge) of ores, metals, minerals and/or product (including rail activities); and all tasks associated with drilling and blasting.
…
B.2.4 Mining Industry Underground Mine Employees
A Mining Industry Underground Mine Employee is designated as such by their employer and performs all tasks as directed by their employer which include but are not limited to: underground mining activities (including labouring, sampling, drilling, blasting, mine ventilation, ground control and shaft activities); and operation and maintenance of underground mining plant and equipment (including mobile plant).
…
[Note: I have omitted the classification groups of Mining Industry Services Employees, Mining Industry Processing Employees and Mining Industry Maintenance Trades Employees. However, I will set out the classification structure in its entirety.]
B.3 Classification Structure
B.3.1 Entry Level—Introductory
An employee at this level is undertaking the standard induction training required for the operation or business. Such training covers: conditions of employment; mine and plant safety; first aid procedures; movement around the site; work and documentation procedures; quality control and quality assurance; and introduction to supervisors and fellow workers. Employees at this level perform routine duties under direct supervision.
This level applies to the following classification groups:
·Mining Industry Services Employees; Mining Industry Surface Mining and Haulage Employees; Mining Industry Processing Employees; and Mining Industry Underground Mine Employees.
B.3.2 Level 1—Basic
An employee at this level will have completed the standard induction training and have been assessed to be able to competently carry out the basic and semi-skilled work required for this level.
This level applies to the following classification groups:
·Mining Industry Services Employees; Mining Industry Surface Mining and Haulage Employees; Mining Industry Processing Employees; and Mining Industry Underground Mine Employees.
B.3.3 Level 2—Intermediate
An employee at this level will have been assessed as being competent to carry out semi-skilled work on a broad range of plant and equipment functions. The employee exercises discretion within their level of skill and is responsible for the quality of the work subject to routine supervision.
This level applies to the following classification groups:
·Mining Industry Services Employees; Mining Industry Surface Mining and Haulage Employees; Mining Industry Processing Employees; and Mining Industry Underground Mine Employees.
B.3.4 Level 3—Competent
An employee at this level will have been assessed as being competent to apply skills and knowledge in complex but routine situations where discretion and judgment are involved. The skills and knowledge are acquired through the completion of a trade certificate, or through practical experience, which has equipped the employee with an equivalent level of skills and knowledge.
An employee at this level can plan tasks, select equipment and appropriate procedures from known alternatives and takes responsibility for the work of others. An employee at this level requires only limited supervision or guidance.
An employee at this level: understands and applies quality control techniques; exercises discretion within the scope of this level; performs work under limited supervision; operates all equipment incidental to the work; and assists in the provision of on-the-job training.
This level applies to the following classification groups:
·Mining Industry Surface Mining and Haulage Employees; Mining Industry Processing Employees; Mining Industry Underground Mine Employees; and Mining Industry Maintenance Trades Employees.
B.3.5 Level 4—Advanced
An employee at this level will have met the requirements for Level 3 and been assessed as being competent to perform tasks which require in depth skill or knowledge, or the employee is assessed as having the integration of a broad range of skills. The work may be of a non-routine nature requiring the application of the relevant skills and knowledge to new but predictable situations.
The level of skills or knowledge required to perform this work will involve the completion of a post trade training appropriate for this level, or through the acquisition of practical skills and knowledge which has equipped the employee with the equivalent level of skills and knowledge.
An employee at this level will provide guidance and assistance to others.
This level applies to the following classification groups:
·Mining Industry Surface Mining and Haulage Employees; Mining Industry Processing Employees; Mining Industry Underground Mine Employees; and Mining Industry Maintenance Trades Employees.
B.3.6 Level 5— Advanced Specialist
An employee at this level will have met the requirements for Level 4 and holds a trade qualification used in the operation and has acquired additional knowledge by having satisfactorily completed a prescribed post trade course appropriate for this level or the achievement to the satisfaction of the employer of a comparable standard of skill and knowledge by other means including in-plant training or on-the-job experience.
An employee at this level will provide guidance and assistance to others.
This level applies to the following classification groups:
·Mining Industry Underground Mine Employees; and Mining Industry Maintenance Trades Employees.
B.3.7 Level 6—Dual Trade
An employee at this level will have met the requirements for Level 5 and holds a dual trade qualification or equivalent prescribed post trade course used in the operation and has acquired additional knowledge enabling the employee to apply dual trade skills or an equivalent level of high precision specialised trade skills in one area.
An employee at this level: has high precision trade skills in more than one area; is qualified to work on machinery or equipment with complex mechanical, hydraulic, electrical circuitry or controls; and meets the skills requirements for Tradespersons in accordance with the Manufacturing and Associated Industries and Occupations Award 2010 for this level.
This level applies to Mining Industry Maintenance Trades Employees.
B.3.8 Level 7—Dual Trade Instrument Technician
An employee at this level will have met the requirements for Level 6 and have acquired further additional knowledge by having satisfactorily completed a prescribed post trades course or an advanced trade equivalent enabling the employee to apply advanced dual trade instrument electrical technician skills.
This level applies to Mining Industry Maintenance Trades Employees.
It is convenient to start with cl 13 of the Award. The classification groups and classification structure in Schedule B are intended to operate in conjunction with cl 13. Clause 13 is quite different to Schedule 1 of the Minebiz Agreement. It does not differentiate between underground and surface employees in terms of rates of pay for levels 1 and 2, although the Minebiz Agreement does exactly that.
However, cl 14.2(a) of the Award may be seen reflected in the note at the end of Schedule 1 of the Minebiz Agreement. The necessary asterisk does not appear in Schedule 1 to allow a complete understanding of that note, but it did appear in the version of an agreement which the FWC earlier refused to approve. With that exception, neither the rates of pay in cl 13, nor the payment relativities it reflects, are relevant to the Minebiz Agreement.
It is the classification groups and classification structure in Schedule B of the Award which the parties agreed were incorporated as a guide to Schedule 1 of the Minebiz Agreement, and it is that accord which requires careful attention. Any use of that material (to the extent to which that might be appropriate) must be approached with caution at least because of the matters I have mentioned, and because the Minebiz Agreement does not specify what the limited references to the Award are intended to signify.
Applying the Agreement with the Award
There was no evidence of any other employment under the Minebiz Agreement, or what range of skills were possessed by employees who might be engaged in any position at the levels nominated in the Minebiz Agreement. There was no basis, therefore, to assess whether Mr Codey was treated, relative to other employees, in an apparently correct, or incorrect, way. The exercise put before the Local Court by the parties was, therefore, somewhat obscure and largely speculative in nature. It did not depend upon showing that Mr Codey’s actual classification (i.e. as given by Minebiz) entitled him to a higher rate of pay. It did not depend upon showing that other employees, performing the same work, were differently classified or received a higher rate of pay. The case for Mr Codey depended on the proposition that, under the Award, he would have been differently classified and, therefore, under the Minebiz Agreement he should (although he would not under the Award itself) have received a higher rate of pay.
In my view, such a case could not succeed on the evidence before the Local Court.
I shall put aside my reservations that the Award could have any possible application to Mr Codey as an employee supplied to Boral.
The wage philosophy incorporated in the Award classification and progression principles (see B.1.2) was that employees were paid according to qualifications or skills possessed, until level 4 was reached, subject to at least some notional requirement to use the qualifications or skills. The Agreement, on the other hand, assigns rates of pay based on employment “in a position”. For Mr Codey to succeed it was necessary to show that he had been employed from the outset and thereafter “in a position” which entitled him to a rate of pay higher than $35 per hour from 18 November 2010, when the Agreement formally commenced to operate.
I can see no basis in the evidence for any suggestion that Mr Codey misunderstood the nature of the position for which he applied and the rate of pay applicable to it. I see no foundation for a finding that he was wrongly classified from the outset. Indeed, the proper inference from the payslips is that he was appointed to a position which corresponded in the Agreement to a rate of pay of $35 per hour and remained in that position during his employment with Minebiz.
There are further difficulties also for Mr Codey’s case which are, in my view, insurmountable.
The Local Court found that Mr Codey was a level 2 employee as described by the Award. When that finding was added to the finding that he was an underground employee (based on the payslip) the conclusion was that he was underpaid because the higher rate of pay for an underground operator was $40.25. I have already indicated that the finding about underground employment cannot stand. But there are other reasons why, applying the Award to the extent relevant and permissible, the conclusion about underground employment is incorrect in any event.
It should be noted that in Schedule 1 of the Minebiz Agreement there are, as I earlier mentioned, two grades each of surface and underground employees, at the same rate of pay. The suggested Award levels offered as comparators do not reflect Schedule B to the Award. The Award does not equate a level 1 underground employee with a level 2 surface employee so far as rates of pay are concerned.
At the outset, therefore, considerable caution should have been employed with any proposition that, under the Minebiz Agreement, any comparison was being made which related entitlements to rates of pay in the Minebiz Agreement with the different classification structure in the Award. I think the Local Court was led into error by the parties themselves on this issue, and that the proceedings miscarried largely as a result. At its highest, and most relevant, the references to the Award may have provided a guide to the placement of existing award employees (if there were any) to positions under the Minebiz Agreement. Mr Codey was not such a person. Otherwise, as I said earlier, the references may have been intended to meet a condition for approval of the Minebiz Agreement but that circumstance gives them no particular utility for assessing Mr Codey’s circumstances.
If those reservations are borne in mind and the analysis proceeds, the next question, so far as the Award is concerned, would first be to what classification group to assign Mr Codey? Most naturally, he would fall into the Award group encompassing “surface and haulage”, not “underground mining”. That is clear by reference to both the name of each group and the description of tasks. Transportation is in the surface and haulage group; it is not named in the underground group. Mr Codey was not an underground miner. He did not profess any disclosed skill or training in underground mining techniques or with underground mining equipment. He was a truck driver.
If the Award was to be relied upon, therefore, it was an error to put aside the surface and haulage classification group in the Award. Where Schedule 1 of the Minebiz Agreement refers to Surface Mining Level 2 and Surface Mining Level 3, those summary descriptions cannot be permitted to exclude or limit the actual content of that classification group by excluding haulage. At least, that is certainly so if the Award classification structure and its various levels is to have any meaning. In the Award, in Schedule B, the two go together.
If the Award classification groups and classification structure applied, therefore, the appropriate position in Schedule 1 to the Minebiz Agreement would be Surface Operator. That is confirmed by the matters which follow.
Mr Codey’s case depended upon him being both in the underground classification group and being at level 2 in that group. Neither condition was satisfied. First, Mr Codey would not, if the Award had applied to him, have been classified, under the Award, as a Mining Industry Underground Mine Employee having regard to the nature of the duties described for that classification group. Any reference in the Minebiz Agreement to “Underground Mine Level 1” or “Underground Mine Level 2”, in conjunction with the Award classification, should only have confirmed that he was not employed under the Minebiz Agreement as an Underground Operator.
Secondly, even if he was an underground miner, to be at level 2 he would need to satisfy the tests set out in B.3.3 of the Award. The plant and equipment functions would be those appropriate to underground mining. Mr Codey would need to satisfy the tests at the time of his engagement. Although evidence of later assessments might illustrate a pre‑existing skill, later training and experience would not be relevant to this assessment.
The evidence did not suggest that Mr Codey was competent on a range of work relevant to underground mine employees, such as those referred to in B.2.4, nor on the operation and maintenance of underground mining plant and equipment. He should not, therefore, have been considered to be at the Award level of an underground mine employee level 2.
That left only for consideration a position of Surface Operator in the Agreement. That conclusion would be reinforced by reference again to the Award, and any reference to an Award classification related to “Surface Mining” could only result in a conclusion (as I have said) that, under the Award, Mr Codey would have been classified as a Mining Industry Surface Mining and Haulage Employee. Any reference in the Minebiz Agreement, therefore, to “Surface Mining” in the Award could only be a reference to this Award group. It was not suggested Mr Codey would be at level 3 (trade certificate or equivalent) in this Award group. He was, therefore, appropriately classified and paid under the Minebiz Agreement as Surface Operator at an hourly rate of $35, consistent with the payslips.
I have not dealt separately with Mr Codey’s role as a co-ordinator. He cannot give colour to that role by describing it as “underground co-ordinator”. In any event, it was an arrangement which, in my view, was outside the operation of the Minebiz Agreement and the legal entitlements it guaranteed. It incorporated extra remuneration and, clearly, it was not intended to affect Mr Codey’s normal classification under the Agreement.
In my view, the Local Court was correct to put this arrangement to one side.
Conclusions
The orders of the Local Court must be set aside and Mr Codey’s application to that Court must be dismissed.
Had I not reached that conclusion, I would not have interfered with the civil penalty imposed which does not seem to me to fall outside a legitimate range, even if I might not have fixed a penalty myself at that level in the circumstances of the present case.
I certify that the preceding seventy-three (73) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Buchanan. Associate:
Dated: 24 April 2015
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