Mr Lucas Schutz v APT Management Services Pty Ltd T/A APA Group Diamantina Power Station

[2021] FWC 1470

[2021] FWC 1470

FAIR WORK COMMISSION

REASONS FOR DECISION

Fair Work Act 2009
s.739 - Application to deal with a dispute

Mr Dylan Ungerer; Mr Clayton Stenhouse; Mr Nicholas Ngatai; Mr Ryan Talbot; Mr Andrew Killip; Mr Roy Macpherson; Mr Brent Donohue; Mr Ben Bendel; Mr Bevin MacDonald; Mr Tony Moloney; Mr Christopher Jamieson; Mr Lucas Schutz
v
APT Management Services Pty Ltd T/A APA Group - Diamantina Power Station
(C2020/4858)

DEPUTY PRESIDENT ASBURY BRISBANE, 18 MARCH 2021

Application to deal with a dispute – application dismissed – reasons for decision.

Background

[1] This Decision concerns an application to the Fair Work Commission (the Commission) by Mr Dylan Ungerer and a group of employees (Applicants) to deal with a dispute pursuant to s.739 of the Fair Work Act 2009 (the Act). The Applicants are represented by Mr Ungerer. The Respondent is APT Management Services Pty Ltd T/A APA Group – Diamantina Power Station (APA Group). The dispute arises under clause 20 of the APA Diamantina Power Station Enterprise Agreement 2018 (the 2018 Agreement) and relates to the accrual of personal leave.

[2] The dispute was not resolved through conciliation and the Applicants sought arbitration. APA does not consent to the dispute being arbitrated and asserts that the Dispute Resolution Procedure in clause 8 of the Agreement does not give the Commission power to arbitrate the dispute without the consent of the parties (the jurisdictional objection). The Applicants insisted that they wished the dispute to be arbitrated and it was therefore necessary for me to determine whether the Dispute Resolution Procedure in clause 8 of the Agreement allows the Commission to arbitrate a dispute.

[3] Directions were issued requiring the parties to file outlines of submissions and any witness statements upon which they intended to rely in relation to the jurisdictional objection and the matter was listed for hearing. APA Group filed written submissions and a statement made by Ms Kathryn Burke, Manager Employee Relations for APA Group. The Applicants filed written submissions and a statement made by Mr Dylan Ungerer. A hearing in relation to the jurisdictional objection was conducted by telephone. This Decision concerns the jurisdictional objection.

[4] I granted permission for the Respondent to be legally represented pursuant to s.596 of the Act, on the basis that the matter involves a jurisdictional objection and I considered that it would enable it to be dealt with more efficiently. In granting permission, I accept the Applicants’ submissions that clause 8 of the 2018 Agreement does not provide for the Respondent to be represented as of right. In this regard, Clause 8 provides as follows:

“During this process, the Employee(s) involved are entitled to appoint a representative to represent them at any or all stages of this process.”

[5] The Dispute Resolution Procedure in clause 8 of the 2018 Agreement provides for employees to appoint a representative and does not contain a corresponding right for the employer. If employees opted to be represented by a lawyer or paid agent, it may be that permission would be granted to both parties. Regardless, the question of whether permission should be granted to the Respondent to be represented is answered by reference to s.596 of the Act and there is no right for the Respondent to be represented absent the grant of permission under that section.

[6] I accept that the Applicants have strong views about the merits of their case and have maintained their assertions that APA Group has not correctly calculated their entitlements to personal leave for a considerable period. However, the Commission cannot arbitrate a dispute under the Dispute Resolution Procedure in the 2018 Agreement unless the Procedure allows the Commission to do so.

[7] I have concluded that the Dispute Resolution Procedure in clause 8 of the 2018 Agreement does not allow the Commission to arbitrate a dispute unless all parties agree, and as APA Group does not agree to arbitration, the Commission has no power to determine the matter. Accordingly, I issued an Order 1 dismissing the application. My reasons for reaching this conclusion are set out below.

The Commission’s power to deal with disputes

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

“595 FWC’s power to deal with disputes

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

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

(a) by mediation or conciliation;

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

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

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

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

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

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

[9] Section 738 of the Act sets out provisions in relation to the Commission dealing with disputes as follows:

“738 Application of this Division

This Division applies if:

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

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

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

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

[10] Section 739 of the Act is in the following terms:

“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.”

[11] By virtue of s.186(6) of the Act, an enterprise agreement must contain a dispute settlement term. A dispute settlement term is not required to provide each party to an agreement with independent access to arbitration and a term that provides for arbitration only by consent of the parties to the dispute, complies with the requirement in s.186(6). 2 The Commission’s powers to deal with disputes derive, in the case of an enterprise agreement, from the terms of the dispute settlement term contained in the enterprise agreement.

[12] As a Full Bench of the Commission concisely observed in CFMEU v North Goonyella Coal Mines Pty Ltd, 3 the Commission may deal with a dispute only on application of a party to the dispute (s.739(6)); is prohibited from exercising any powers limited by the dispute settlement procedure (s.739(3)); may arbitrate only if the agreed dispute settlement procedure permits it to do so (s.739(4)); and must not make a decision that is inconsistent with the Act, the enterprise agreement and any other applicable fair work instrument (s.739(5)).

The Dispute Resolution Procedure in the 2018 Agreement

[13] The Dispute Resolution Procedure is set out in clause 8 of the 2018 Agreement as follows:

“8 DISPUTE RESOLUTION PROCEDURE

8.1 This dispute resolution procedure will apply to any dispute relating to a matter arising under this Agreement or a dispute in relation to the NES.

8.2 In the event of a dispute in relation to the above, in the first instance the Employee(s) should raise their concerns with their relevant leader or supervisor. If possible, the parties involved should attempt to resolve the matter by discussions between the Employee(s) concerned.

8.3 If such discussions do not resolve the dispute, the parties involved should attempt to resolve the issue in a timely manner by discussions between the Employee(s) concerned and more senior levels of management as appropriate. Where necessary, if the dispute remains unresolved, this step will be repeated until such discussions are held with the most senior level of management for the business unit.

8.4 If the dispute is still unresolved following the steps outlined in clause 8.3, and all appropriate steps above have been taken, a party to the dispute may refer the dispute to a more senior Company line manager or Human Resources representative who will endeavour to resolve the issue with the parties.

8.5 If the dispute is still unresolved following the steps in clause 8.4, and all appropriate steps above have been taken, a party to the dispute may refer the dispute to the FWC. The parties involved may agree on the process to be utilised by the FWC including mediation and conciliation.

8.6 Where the matter remains unresolved, the Fair Work Commission may exercise any method of dispute resolution permitted by the Act that it considers appropriate to ensure the settlement of the dispute.

8.7 During this process, the Employee(s) involved are entitled to appoint a representative to represent them at any or all stages of this process.

8.8 While the dispute resolution procedure is being conducted, work must continue in accordance with the Company's direction and with respect to safe work practices and the Employee(s) skills, competence and training.”

APA Group evidence and submissions

[14] APA Group submits that clause 8 of the 2018 Agreement does not empower the Commission to arbitrate a dispute without the consent of the parties. APA Group submits that, in accordance with sections 595 and 739 of the Act, the Commission can only arbitrate the current dispute if the parties consented to that course and APA Group does not consent to arbitration of the dispute. APA Group refers to sections 593(3) and (5) of the Act which make clear that the Commission cannot arbitrate a dispute unless expressly authorised to do so under another provision of the Act.

[15] APA Group submits that the Applicants’ Form 10, at Part 3.1, seeks relief on the basis that “the dispute resolution clause in the instrument gives the Commission the power to arbitrate the dispute”. APA Group then refers to steps 5 and 6 of the dispute resolution procedure which are in the following terms:

“8.5 If the dispute is still unresolved following the steps in clause 8.4, and all appropriate steps above have been taken, a party to the dispute may refer the dispute to the FWC. The parties involved may agree on the process to be utilised by the FWC including mediation and conciliation.

8.6 Where the matter remains unresolved, the Fair Work Commission may exercise any method of dispute resolution permitted by the Act that it considers appropriate to ensure the settlement of the dispute.”

[16] APA Group submits that the terms do not allow for a dispute to be arbitrated without agreement of all parties. While it is a requirement of s.186(6) of the Act that an enterprise agreement includes a term that allows for the Commission, or another person independent of those covered by the agreement, to resolve disputes about matters arising under the agreement or the National Employment Standards, that term does not have to provide for arbitration, 4 and where the parties have not by the terms of agreement (or otherwise) agreed for the Commission to arbitrate, there is no power for it to do so.5

[17] APA Group submits that the nature of the conferral of power by the parties in a dispute settling procedure is important and that the Commission is not exercising judicial power in dealing with a dispute. Where the dispute settlement procedure confers a power to arbitrate the dispute, it is a power of private arbitration derived only from the parties’ agreement to submit their differences for decision. 6 APA Group submits that the current dispute turns on the construction of clause 8 of the 2018 Agreement, and in particular clause 8.6.

[18] APA Group relevantly highlights that the principles applicable to the construction of enterprise agreements were articulated in the Full Bench decision of Australian Manufacturing Workers’ Union v Berri Pty Ltd (Berri) 7 and the decision of the Full Court of the Federal Court in Workpac Pty Ltd v Skene8 which held that the starting point for the interpretation of an enterprise agreement is the ordinary meaning of the words, read as a whole and in context. 9

[19] APA Group submits that consistent with the principles in those decisions, the ordinary meaning of the language of clause 8 of the Agreement, and in particular clauses 8.5 and 8.6, support its construction that the clause does not empower the Commission to arbitrate, absent the parties’ consent for that to occur in a given case. In support of this submission, APA Group points to the following matters:

•  The term arbitrate/arbitration is not used in clause 8, let alone any express reference to such a power;

•  There is no compulsion on a party to refer a dispute to the Commission. Clause 8.5 provides only that this “may” occur;

•  Where a matter is referred to the Commission in accordance with clause 8.5, the parties “may agree on the process…including mediation and conciliation”.

•  Clause 8.5 is a process provision which reserves discretion to the parties as to whether a matter is referred to the Commission, and if it is, how the Commission may proceed;

•  While the word “including” in clause 8.5 is not one of limitation, arbitration is not referenced, and any process is still subject to the discretion of the parties to “agree on process”;

•  Clause 8.6 provides that if a dispute is unresolved, the Commission “may exercise any method of dispute resolution permitted by the Act that it considers appropriate to ensure the settlement of the dispute”. Arbitration is a method “permitted by” the Act, but only where expressly agreed to by the parties. The ordinary meaning of clause 8.6 does not provide such express agreement. (APA Group’s emphasis)

[20] APA Group submits that, even if it is considered that some ambiguity exists in the wording of clause 8, it still cannot be accepted that clause 8.6 of the Agreement, having regard to its context and purpose, provides express agreement for the Commission to arbitrate a dispute without the consent of the parties. APA Group submits that this includes the legislative purpose of the dispute settling provision, and that clause 8.5 provides that reference of a dispute to the Commission and how it is to proceed is subject to the agreement of the parties.

[21] APA Group submits that terms of similar effect to clause 8.6 of the 2018 Agreement have consistently been found by the Commission to not empower it to arbitrate a matter without the consent of the parties in a given case. In support of this submission, APA Group cites relevant case authorities as follows.

[22] In CC Pty Ltd T/A Cook Colliery v Construction, Forestry, Mining and Energy Union (Cook Colliery) 10, a Full Bench of the Commission found that clause 32 of the CC Pty Ltd Enterprise Agreement 2012 (CC Agreement) “should not be construed so as to empower the Commission to arbitrate the dispute without the agreement of the parties”.11 APA Group submits that in this decision, the Full Bench was mindful that in Award Modernisation [2008] AIRCFB 1000: 177 IR 364, another Full Bench had determined that clause 9.4 of the Black Coal Mining Industry Award (BCM Award) “did not provide for compulsory arbitration”,12 and that clause 32 was similar to that clause.

[23] At paragraph [40] of the Cook Colliery decision the Full Bench said:

“Noting the similarities between clause 9.4 of the Black Coal Mining Industry Award and clause 32 of the Agreement outlined above, and as clause 9.4 was considered not to provide for compulsory arbitration, we are not satisfied that the Full Bench in Award Modernisation erred in its construction. Accordingly, clause 32 of this Agreement, consistent with the construction in Award Modernisation, should not be construed so as to empower the Commission to arbitrate the dispute without the agreement of the parties.”

[24] Regarding the current dispute, APA Group submits that clause 8.6 of the 2018 Agreement is in effectively identical terms to the provision of clause 32 of the CC Agreement considered by the Full Bench. Further, the only difference between the operative words of clause 8.6 of the 2018 Agreement and the relevant provision of the CC Agreement, is that the 2018 Agreement provides for the Commission to exercise “any method of dispute resolution permitted by the Act” whereas the CC Agreement refers to “any method of dispute resolution permitted…”. APA Group also submits that clause 9.4 of the BCM Award which is the dispute resolution term is also in virtually identical terms to the dispute resolution term in clause 29.6 of the Electrical Power Industry Award 2020 (EPI Award). The EPI Award is the underlying modern award that covers employees subject to the Agreement. APA Group submits that as was the case in Cook Colliery, the award underpinning the 2018 Agreement does not provide for disputes to be arbitrated by the Commission.

[25] APA Group also provided a table comparing clause 8 of the 2018 Agreement with clause 32 of the agreement that was considered by the Full Bench in Cook Colliery and compares the dispute resolution terms in the EPI Award and the BCM Award. In summary, APA Group submits that the differences between clause 8.6 of the 2018 Agreement, and the dispute resolution term in the Cook Colliery case, are not material, nor sufficient to afford a different approach to the construction of clause 8.6 of the Agreement than was adopted by the Full Benh in Cook Colliery. APA Group submits that the Commission should accept that this matter is essentially on “all fours” with the circumstances in the Cook Colliery case and interpret clause 8 in the 2018 Agreement on the same basis.

[26] APA Group submits that the approach of the Full Bench in Cook Colliery continues to be applied by members of the Commission. 13 It submits that, consistent with the approach of the Full Bench in Cook Colliery, regarding the current dispute, the Commission should not find that clause 8 of the 2018 Agreement empowers the Commission to arbitrate the dispute.

[27] Although there is no requirement for the Commission to enquire into surrounding circumstances of the change to clause 8 of the 2018 Agreement APA Group submits that clause 8 of the 2018 Agreement does not differ materially from the dispute resolution procedure at clause 26 - Issue Resolution Process of the earlier Diamantina Power Station Enterprise Agreement 2013 (2013 Agreement) which also did not provide for disputes to be arbitrated. APA Group submits there is no evidence to establish objective background facts to allow for a finding that there was any common understanding in making the 2018 Agreement, that the intent of the parties was to adopt a different approach to the 2013 Agreement and empower the Commission to arbitrate without consent in a given case. Absent such evidence the Commission would not depart from the approach in Cook Colliery. For these reasons, APA Group submits that on the proper construction of clause 8 of the 2018 Agreement, the Commission is not empowered to arbitrate the current dispute.

[28] In support of APA Group’s submissions, Ms Kathryn Burke, Manager Employee Relations for the Respondent, provided a witness statement. Ms Burke states that when she commenced with APA Group, employees at the Diamantina Power Station were covered by the 2013 Agreement. The 2013 Agreement had a nominal expiry date of 22 January 2017.

[29] A replacement agreement had been negotiated before Ms Burke started with APA Group, but was not approved by the Commission and the parties were required to start bargaining again (2017 Document). Ms Burke states that she joined the negotiations in July 2018 for the 2018 Agreement, when a colleague commenced parental leave. She assisted the General Manager Power and DPS Manager with the making of the 2018 Agreement.

[30] Ms Burke’s evidence is that the disputes procedure in the 2013 Agreement was at clause 26 - Issue Resolution Process. In her view, that clause did not provide for compulsory arbitration by the Commission or any other appointed “independent third party” but rather, it was for the parties in any given dispute to determine where an ongoing dispute may be referred and how it would be dealt with.

[31] Ms Burke states that clause 28 - Issue Resolution Process of the 2017 Document was similar to clause 26 of the 2013 Agreement, with the main difference being clause 28.1(d) no longer referred to unresolved issues being referred to an “independent third party” but only to the Commission, with the parties to agree on the process. Following the 2017 Document not being approved, the parties began bargaining for the 2018 Agreement. Ms Burke states that at her initiative, the document was re-structured in a number of respects to try to align it with the structure of other APA Group Enterprise Agreements for ease of application, including that the terms required by the Act, such as consultation, flexibility arrangements and disputes procedure, were relocated to the front of the document, with clause 8 being the Dispute Resolution Procedure.

[32] Ms Burke’s recollection is that clause 8 of the 2018 Agreement was copied from the APA Midstream Enterprise Agreement (Victoria) 2017 which had been approved by the Commission on 20 April 2018. Ms Burke states that she did this because it appeared to her to be a well-put together clause that was consistent with what APA Group intended at Diamantina for dispute resolution and aligned to the Electrical Power Industry Award 2010.

[33] Ms Burke states that presentations were made by Matthew Forrest, General Manager Power to employees at Diamantina Power Station about the 2018 Agreement, including how it differed from the 2013 Agreement on 7 and 8 February 2019. The employees voted to approve the 2018 Agreement, and the Agreement was approved by the Commission on 19 March 2019, taking effect on 26 March 2019.

[34] Ms Burke’s evidence is that at no time did APA Group authorise her or any Company representative, to her knowledge, to commit the Respondent to a provision in the Agreement for compulsory arbitration. Ms Burke states there was no claim for that and nor was it ever put to her by anyone that was to be the case.

[35] In response to the submissions of the Applicants, APA Group said that the material that has been filed is substantially directed to the underlying dispute, but irrelevant to the question of whether the 2018 Agreement expressly authorises the Commission to arbitrate a dispute. In this regard, it is not relevant that the Applicants may agree for the matter to be arbitrated because the agreement of one party does not expressly authorise the Commission to arbitrate the dispute.

[36] Ms Burke said that the Applicants’ submissions that the terms of the 2018 Agreement can be distinguished from the provisions considered in Cook Colliery, cannot be accepted. In this regard the fact that clause 8.5 of the 2018 Agreement does not expressly refer to the potential for parties providing the Commission “agreement” for arbitration, does not then mean that clause 8.6 of the Agreement has provided that express power to the Commission at the next stage of the procedure. The words of clause 8.5 that the parties “may agree on the process to be utilised by the FWC including mediation and conciliation” are not words of limitation. Alternatively, the absence of a reference to arbitration in clause 8.5 of the Agreement indicates that it was deliberately excluded.

[37] In any event, clause 8.6 of the Agreement continues in sequence after clause 8.5, and provides that the parties may agree on the process to be utilised by the Commission. To suggest the minor differentiation in clause 8.5 of the Agreement with the equivalent provision in Cook Colliery, is sufficient to maintain that clause 8.6 of the Agreement then expressly authorises the Commission to arbitrate a dispute, is a quantum leap. Clause 8.6 is still expressed in language that the Commission “may” do certain things, which sequentially follows a Commission process grounded at clause 8.5 involving the parties agreeing a process. Clause 8.6 is not, in context, the language of an express authorisation to arbitrate. APA Group also submits that, in all the circumstances, where provisions relevantly identical to clause 8.6 of the Agreement have consistently been held not to provide an express authorisation for arbitration, the Commission could not in this case conclude that something different applies.

[38] APA Group also submits that if it is found the matter cannot be arbitrated, the Applicants seek a Recommendation about the merits of the underlying dispute. It is APA Group’s position that in the circumstances of this matter, an unenforceable Recommendation has the potential to cause confusion as to entitlements within the workforce (which is unrepresented) and create further disharmony in the workplace.

Applicants’ submissions and evidence

[39] The Applicants submit that disputes have been raised under a previous dispute matter (C2020/1802, now closed) and the current dispute (C2020/4858) in relation to clause 20 - Personal Leave and clause 8 - Dispute Resolution Procedure, and particularly whether the Commission has the power to arbitrate as required by s.595(3) of the Act.

[40] The Applicants refer to the Cook Colliery decision, stating it “incorporates different meaning and interpretation in relation to their Dispute Resolution (Grievance) Procedure in their enterprise agreement” and to the following provision in clause 32 of the agreement considered in that case, which relevantly states:

“The parties may agree on the process to be utilised by FWA including mediation, conciliation and arbitration.”

[41] The Applicants note that the Full Bench found that as both parties did not agree for the Commission to arbitrate, the Commission had no power to arbitrate. As to the current dispute, the Applicants submit that the 2018 Agreement provides:

“This dispute resolution procedure will apply to any dispute relating to a matter arising under this Agreement or a dispute in relation to the NES.”

[42] Clause 8.5 the 2018 Agreement then provides for the Commission to mediate and conciliate a dispute should either the employees or employer raise one and that:

“If the dispute is still unresolved following the steps in clause 8.4, and all appropriate steps above have been taken, a party to the dispute may refer the dispute to the FWC. The parties involved may agree on the process to be utilised by the FWC including mediation and conciliation.”

[43] The Applicants submit that the dispute resolution procedure in the 2018 Agreement then provides that if the steps up to and including those provided in clause 8.5 fail to resolve the dispute, clause 8.6 provides the Commission power to exercise “any” method of dispute resolution permitted by the Act. As the matter remains unresolved and an agreement cannot be made in relation to clause 20 – Personal Leave, the Applicants submit that then clause 8.6 comes into effect, giving the Commission full power to arbitrate as per s.595(3) of the Act.

[44] The Applicants also submit that s.595(3) of the Act authorises the Commission to deal with a dispute by arbitration provided it is authorised to do so. In this regard, the Applicants submit that clause 8.6 gives the Commission the power to exercise any method of dispute resolution that is permitted by the Act. Further, the Applicants submit that this includes, but is not limited to, mediation, conciliation, making a recommendation, expressing an opinion, arbitration and making orders it considers appropriate.

[45] The Applicants contend that s.738(c) of the Act authorises the Commission to deal with a dispute within an enterprise agreement when:

“An enterprise agreement includes a term that provides a procedure for dealing with disputes, including a term referred to in subsection 186(6).”

[46] The Applicants further contend that s.739(4) provides the Commission may arbitrate (however described) the dispute. The Applicants’ position is that clause 8.6 of the 2018 Agreement satisfies these provisions of the Act and the Commission is accordingly empowered to arbitrate the dispute. above.

[47] Mr Ungerer provided a witness statement in support of the Applicants’ position. Mr Ungerer states that he is employed by APA Group as an Operator Technician for the Diamantina Power Station located in Mount Isa, Queensland. He has been employed with the company since 7 January 2018 and represents the joint Applicants in this dispute matter. Mr Ungerer states that when he commenced employment, he was employed and operated under the 2013 Agreement. He confirms that negotiations for the 2018 Agreement were “wrapping up”, and the 2018 Agreement was approved by the Commission on 19 March 2019 with effect from 26 March 2019.

[48] Mr Ungerer states that the 2018 Agreement contains a dispute resolution clause at clause 8. The Applicants interpret clause 8 to be a “series of actions conducted in a certain order or manner (the literal definition of ‘Procedure’)”. Mr Ungerer notes that clauses 8.2 – 8.4 provide for attempts to settle a dispute at the workplace level. Clause 8.5 of the 2018 Agreement then allows a party to lodge a dispute with the Commission, and the parties may agree on the process to be utilised by the Commission, including mediation and conciliation. Mr Ungerer states that APA Group participated proceedings under the original dispute (C2020/1802) and attempted to resolve the issue, which indicates that APA Group agreed to conciliate and mediate at that point. Mr Ungerer states that as the Respondent has participated in a conference of the current dispute matter (C2020/4858), this “indicates the same”.

[49] Mr Ungerer states that as the matter remains unresolved, clause 8.6 is thereby enlivened which allows the Commission to exercise “any method of dispute resolution permitted by the Act that it considers appropriate to ensure the settlement of the dispute.” Mr Ungerer states that ‘any method permitted by the Act’ includes arbitration.

[50] Mr Ungerer also states that clause 8.6 does not express that permission from either party is required for the Commission to handle the dispute. Mr Ungerer also annexed to his statement various emails and minutes of meetings to evidence the Applicants following the appropriate process under clause 8, prior to bringing the dispute in the Commission. Mr Ungerer further states that the Applicants all agree for the Commission to exercise any method of dispute resolution permitted by the Act.

Consideration

The approach to construction of enterprise agreements

[51] A determination of whether the Commission has power to arbitrate the current dispute in accordance with clause 8 of the 2018 Agreement, requires a construction of the Agreement. The approach to the construction of industrial instruments such as enterprise agreements was most recently summarised in a Decision of a Full Bench of the Commission in “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) v Berri Pty Ltd 14as follows:

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

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

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

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

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

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

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

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

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

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

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

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

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

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

12. Evidence of objective background facts will include:

(i) evidence of prior negotiations to the extent that the negotiations tend to establish objective background facts known to all parties and the subject matter of the agreement;

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

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

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

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

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

Application of principles to present dispute

[52] The construction of a disputed term in an enterprise agreement commences with the ordinary meaning of the text of that term. The dispute centres on clause 8.6 which provides that where a matter which has been referred to the Commission under previous steps, remains unresolved, the Commission “may exercise any method of dispute resolution permitted by the Act that it considers appropriate to ensure the settlement of the dispute”. The plain meaning of those words is that the Commission may exercise any dispute resolution method it considers appropriate to settle the dispute, provided that the method of dispute resolution the Commission decides to exercise, is permitted by the Act.

[53] There is no express reference to arbitration in clause 8.6 of the Agreement. Neither is there any such reference elsewhere in the clause. The only processes referred to in the clause are mediation and conciliation. This tells against a construction of the Agreement to the effect that the clause empowers the Commission to arbitrate the dispute in the absence of agreement of the parties to the dispute. The term “may” in relation to agreement to a process also indicates that the parties have a discretion to agree or not to agree in relation to the process to be utilised. The matter of whether the clause requires the parties to agree to mediation or conciliation before the Commission can undertake either process was not canvassed in these proceedings and it is not necessary that I decide this point. For present purposes, it suffices to say that the plain words of the clause do not empower the Commission to arbitrate the dispute unless both parties agree.

[54] When the clause is considered in the context of the 2018 Agreement as a whole, there is also no indication in other clauses that the Commission is empowered to arbitrate a dispute between the parties in the absence of agreement. Other contextual matters supporting this construction include the previous 2013 Agreement which also did not provide for disputes to be arbitrated. It is also the case that clause 29 of the Electricity Award 2010 (now the Electricity Award 2020) does not provide for the Commission to arbitrate a dispute about a matter under the Award or in relation to the National Employment Standards (NES). That Award was the instrument against which an assessment of whether the 2018 Agreement passed the better off overall test (BOOT) was made.

[55] A further contextual matter is the legislative provisions under which the 2018 Agreement was made. Section 595(2) of the Act provides that the Commission can deal with a dispute (other than by arbitration) as it considers appropriate, including by mediation or conciliation or by making a recommendation or expressing an opinion. Section 739(3) provides that in dealing with a dispute, the Commission must not exercise any powers limited by a term of an enterprise agreement providing for a procedure dealing with disputes. Clause 8 of the Agreement limits arbitration by not providing for it unless the parties to the dispute agree that the dispute may be arbitrated.

[56] As a Full Bench of the Commission observed in Re: Woolworths Ltd (t/as Produce and Recycling Distribution Centre): 15

“Section 739(4) sets out the circumstances in which Fair Work Australia may arbitrate a dispute, providing that if the parties have agreed that Fair Work Australia may arbitrate, Fair Work Australia may do so. It appears to us that s 739(4) strongly implies the negative stipulation that if the parties have not agreed, Fair Work Australia has no power to arbitrate.” 16

[57] There is nothing in clause 8 of the 2018 Agreement evidencing an express agreement to arbitration. The clause operates so that on each occasion a dispute is notified to the Commission and is not resolved through conciliation, the consent of all parties is required before the Commission can arbitrate the dispute. Accordingly, as clause 8 of the Agreement does not represent an agreement between the parties and there has been no other express agreement, clause 8 of the Agreement cannot be construed as allowing the Commission to arbitrate the dispute. As there is no agreement by APA Group that the dispute be arbitrated, s.739(4) is not enlivened and, therefore, the Commission is not expressly authorised to deal with the dispute pursuant to s.595(3) of the Act. There are no other contextual matters referred to by the parties to contradict the plain meaning of the words in the 2018 Agreement.

[58] In conclusion, my view about the proper construction of clause 8 of the 2018 Agreement is consistent with the Decision of a Full Bench of the Commission in CC Pty Ltd T/A Cook Colliery v Construction, Forestry, Mining and Energy Union. 17In that case, a Full Bench of the Commission was considering a dispute settlement term in an enterprise agreement that relevantly provided as follows at the point the dispute was referred to the Commission (then known as FWA):

Step 4	If such discussions do not resolve the dispute, the parties will endeavour to resolve the dispute in a timely manner and refer the dispute to FWA.
Process	The parties may agree on the process to be utilised by FWA including mediation, conciliation and arbitration.
Power of FWA	Where the matter in dispute remains unresolved, FWA may exercise any method of dispute resolution permitted that it considers appropriate to ensure the settlement of the dispute.

[59] As in the present case, the term provided that the parties “may agree on the process to be utilised”. It is not material that the listed process in the procedure under consideration in Cook Colliery included arbitration. The Full Bench held that the clause should not be construed as providing for agreement of the parties to the Commission resolving any unresolved dispute. Rather, the clause required that the parties agree to arbitration before the Commission had power to arbitrate.

[60] The clause in the 2018 Agreement is not materially different and does not provide for express agreement to arbitration. In the present dispute, absent agreement by APA Group to arbitration, clause 8 of the 2018 Agreement does not empower the Commission to arbitrate the dispute.

[61] If the Applicants wish to pursue the assertion that their personal leave entitlements under the National Employment Standards have not been met, they can do so by filing an application in a court of competent jurisdiction.The Commission is not a court and cannot deal further with the matter. For these reasons, I dismissed the application.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

<PR727883>

 1   PR727761.

 2   Re Woolworths Ltd (t/as Produce and Recycling Distribution Centre) (2010) 192 IR 124.

 3   [2015] FWCFB 5619.

 4   CFMEU v North Goonyella Coal Mines Pty Ltd[2015] FWCFB 5619 at [34].

 5   Re Woolworths Ltd (t/as Produce and Recycling Distribution Centre) (2010) 192 IR 124 at [21]-[23] and [27]-[29].

 6   CFMEU v AIRC (2001) 203 CLR 645; 103 IR 473 at [31] and [34].

 7   [2017] FWCFB 3005; 268 IR 285.

 8 [2018] FCAFC 131; (2018) 280 IR 191.

 9 Ibid at [197].

 10   [2017] FWCFB 2749.

 11 Ibid at [40].

 12   Cook Colliery at [36]; see Award Modernisation at [43] and [159]-[160].

 13   See for example Giannopoulos v Chisholm & Gamon Property Pty Ltd (Wilson C 18/9/18) – considered Cook Colliery at [11]-[16], and in accordance with it determined at [15]-[16] that clause 9 of the Real Estate Industry Award 2010 did not empower the Commission to arbitrate the dispute without agreement of the parties.

 14   [2017] FWCFB 3005 at [14].

 15 (2010) 192 IR 124.

 16 (2010) 192 IR 124, 131 [21].

 17   [2017] FWCFB 2749.