Mr William Renton-Power v Batchfire Callide Management Pty Ltd

[2018] FWC 5763

[2018] FWC 5763

FAIR WORK COMMISSION

DECISION

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

Mr William Renton-Power
v
Batchfire Callide Management Pty Ltd
(C2018/1907)

DEPUTY PRESIDENT ASBURY BRISBANE, 13 SEPTEMBER 2018

Application for Commission to deal with a dispute pursuant to s. 39D of the Coal Mining Industry (Long Service Leave) Administration Act (1992) (Cth) – Interaction ss. 738 and 739 of Fair Work Act 2009 – Inappropriate use of Commission’s powers and functions to deal with dispute where factual scenario involves non-parties – Decision to exercise discretion to refuse to deal with the dispute – Application dismissed.

BACKGROUND

[1] The Coal Mining Industry Long Service Leave Administration Act 1992 (Cth) (Coal LSL Act) establishes a portable long service leave scheme which enables eligible employees to carry separate periods of qualifying service across to other employers in the black coal mining industry and provides for a fund which reimburses employers for long service leave payments made to eligible employees. The Coal LSL Act also establishes the Coal Mining Industry (Long Service Leave Funding) Corporation (the Coal LSL Corporation) with functions including maintenance of records of employment of eligible employees and their qualifying service and entitlements. Section 39D of the Coal LSL Act empowers the Fair Work Commission (the Commission) to deal with disputes relating to long service leave, by operating in certain ways upon the dispute settling functions and powers of the Commission under the Fair Work Act 2009 (the FW Act).

[2] The present case concerns an application by Mr William Renton-Power (the Applicant). Mr Renton-Power was an employee of Batchfire Callide Management Pty Ltd (the Respondent) from 26 August 2010 until 18 March 2016 when he was dismissed. 1 The application is made on a Form F10 as an application for the Commission to deal with a dispute in accordance with a dispute settlement procedure. The application states that the industrial instrument which covers the employment relationship and contains the dispute resolution procedure relevant to the application is the Callide Mine Union Enterprise Agreement 2012 (the Agreement). It is further stated that there is another instrument or written agreement containing the dispute resolution procedure, being s. 39D(1) of the Coal Industry LSL Act.

[3] The application was subsequently amended in an apparent attempt to establish that the dispute was raised with the Respondent prior to the ending of the Applicant’s employment. The relief sought in the original and the amended application is the payment – presumably by the Respondent – of the Applicant’s long service leave.

[4] A Conference was conducted and the dispute was not resolved. The Respondent objects to the Application on a number of grounds including whether the dispute settlement procedure under the Agreement was properly invoked in circumstances where the Applicant was no longer employed at the point the dispute arose. Directions were subsequently issued in relation to the Respondent’s objection and outlines of submissions were filed by both parties in response to those directions. Following the filing of submissions, the Parties agreed that the matter could be determined on the basis of the material on the file without the need for a hearing.

[5] In submissions filed in response to the Directions, the Applicant indicated that he was no longer seeking that the Commission make a determination pursuant to a dispute settlement procedure in the Agreement. Rather the Applicant seeks that the Commission make a recommendation or express an opinion in relation to the question of whether the Respondent is required to pay the Applicant his long service leave in accordance with the express power of the Commission under s. 595(2)(b) of the Fair Work Act 2009 (the FW Act).

[6] The Respondent maintains its objection to the application and submits that in all of the circumstances, the Commission should exercise discretion pursuant to s. 739 and s. 595(2) of the FW Act and s. 39D(1) of the Coal LSL Act and decline to deal with the dispute on a number of grounds including that:

● The determination of whether the Applicant has completed the required amount of qualifying service is a matter for the Coal LSL Corporation;

● The Coal LSL Corporation has indicated that the Applicant has not yet completed the required period of qualifying service and the Respondent would not be entitled to reimbursement out of the Fund if the Respondent made a payment to the Applicant with respect to long service leave;

● There are alternative mechanisms that could result in the Applicant achieving the relief sought in these proceedings including an application to the Coal LSL Corporation to investigate his qualifying service or an application to a Court;

● Any recommendation or opinion expressed by the Commission in relation to the dispute would not be binding on the Coal LSL Corporation or the Applicant’s former employers; and

● There is no utility or purpose in the Commission dealing with the dispute.

LEGISLATION

[7] Section 39D of the Coal LSL Act provides:

“39D  FWC may deal with disputes relating to long service leave

(1) Despite subsection 595(1) of the Fair Work Act 2009, the FWC may deal with a dispute (an LSL dispute) about matters in relation to long service leave under this Part.

(2)  For the purposes of the FWC dealing with an LSL dispute, the Fair Work Act 2009 applies as if:

(a)  the dispute were a dispute in relation to the National Employment Standards; and

(b) subsection (1) of this section were a term referred to in section 738 of that Act; and

(c)  a reference in subsection 739(5) of that Act to “this Act” were a reference to “the Coal Mining Industry (Long Service Leave) Administration Act 1992”.”

[8] Section 738 of the Act provides that Division 2 of Part 6-2 of the Act – Dealing with disputes – applies if a number of circumstances are met and by virtue of s. 39D(2)(b) of the Coal LSL Act, Division 2 applies for the purposes of the Commission dealing with a long service leave dispute. 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.”

[9] Section 595 of the Act provides as follows in relation to the power of the Commission to deal with disputes:

“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.”

RESPONDENT’S SUBMISSIONS

[10] The Respondent submits that in all of the circumstances, the Commission should exercise its discretion pursuant to s. 739 and s. 595(2) of the FW Act and s. 39D(1) of the Coal LSL Act and decline to deal with the dispute. The Respondent also points to the fact that the Commission does not have the power under the Coal LSL Act to deal with a dispute by arbitration on the basis that the Respondent does not consent to arbitration. The Respondent also submits that there is no utility or purpose in the Commission dealing with the dispute as it would not achieve the relief sought by the Applicant. In light of the Applicant no longer seeking that the Commission deal with the matter under the dispute settlement procedure in the Agreement, I have not considered the Respondent’s submissions on this point further. However, my view is that the Applicant’s concession on this point was appropriately made.

[11] Section 39D(1) of the Coal LSL Act provides that the Commission may deal with a dispute (an LSL dispute) about matters in relation to long service leave. There is no express grant of power under the Coal LSL Act for the Commission to deal with a dispute by arbitration, and by virtue of s. 595(3) of the Act the Commission may deal with a dispute by arbitration only if expressly authorised to do so.

[12] The Respondent also points to s. 739(4) of the Act, which provides that the Commission may deal with a dispute by arbitration where there is consent from both parties, and states that it does not consent to arbitration. The Respondent submits that there would be no utility or purpose in the Commission dealing with the dispute, including by expressing any opinion or making a recommendation regarding Mr Renton-Power’s qualifying service or long service leave entitlements.

[13] In this regard, the functions of the Coal LSL Corporation include maintaining records relating to the employment of eligible employees; the qualifying service completed by, and the long service leave entitlements of, eligible employees; and the amounts that are, or may become, payable to employers under Part 7 of the Coal LSL Act by way of reimbursement.

[14] The Respondent submits that it is not for the employer to determine whether an employee’s service is qualifying service for the purposes of the Coal LSL Act, instead arguing that the records maintained by the Coal LSL Corporation provide certainty and fairness to employers and employees and allow employers and employees to verify the amount of qualifying service an employee has completed and amounts that are payable to employees.

[15] An application was made to Coal LSL Corporation by the Respondent to verify the Applicant’s long service leave entitlement. The Coal LSL Corporation advised the Respondent that Mr Renton-Power had not met the required period of qualifying service (eight years) to be entitled to long service leave as a benefit on termination. As a result, if the Respondent made a payment to the Applicant, it would not be entitled to reimbursement from the fund. Therefore, the Respondent submits that requiring that a payment be made to the Applicant would be unreasonable.

[16] Further, the Respondent submits that two mechanisms already exist by which the Applicant can achieve the relief sought in the proceedings: the Applicant could apply directly to the Coal LSL Corporation to investigate his qualifying service, and if it was found that the Applicant was entitled to long service leave the Respondent would make the relevant payment or the Applicant could apply to the Federal Court of Australia or the Federal Circuit Court of Australia for orders regarding payment of any long service leave entitlements.

[17] The Respondent further submits that even if the Commission were to make a recommendation or offer an opinion regarding the dispute, this would not be binding on the Coal LSL Corporation or any of the Applicant’s former employers.

APPLICANT’S SUBMISSIONS

[18] The Applicant’s submissions state that he seeks that the Commission deal with the dispute in accordance with s. 39D of the Coal LSL Act. The Applicant is not seeking that the Commission arbitrate the dispute, and is instead seeking that the Commission make a recommendation, or express an opinion, on whether the Respondent is required to pay his accrued long service leave.

[19] The Applicant relies on the Commission’s express power under s. 595(2)(b), and argues that such a recommendation would be proper and allow the parties a quick and less costly mechanism for resolution of disputes of this nature than would be the case if an application was made to a Court. The Applicant further contends that an acceptance of Callide’s submission that the role and function of the Coal LSL Corporation is to determine long service leave entitlements would be contrary to the express jurisdiction provided to the Commission by parliament.

[20] The Applicant relies on the Full Bench decision in Cowley v Dust-A-Side Australia Pty Ltd 2, in which it was held that the Commission has the jurisdiction to deal with disputes under s. 39D of the Coal LSL Act. The Applicant asserts that the dispute in that case is exactly the kind of dispute that is sought to be resolved in the present case, and that the Full Bench held that the Commission has jurisdiction to deal with these types of disputes.

[21] The Applicant is not seeking that the Commission arbitrate the dispute but rather is seeking that the Commission make a recommendation or express a view on whether the Respondent is required to pay the Applicant his long service leave. The Applicant submits that such a recommendation would be proper as the Commission offers the parties a quick and far less costly mechanism for resolution of these types of dispute than a Court and that such a dispute should not be treated any differently to other disputes in relation to the terms of a modern award, enterprise agreement or a National Employment Standard.

[22] The Commission should reject the Respondent’s submission that it is the role and function of the Coal LSL Corporation to determine long service leave entitlements, as to accept that submission would mean that the Commission would be acting contrary to the express jurisdiction that Parliament has provided to it. The Applicant argues that the obligation to pay long service leave entitlements to an employee rests entirely with the employer, and that once long service leave entitlements are paid to an employee the employer can seek reimbursement from the Coal LSL Fund. The present dispute concerns whether the Applicant is an eligible employee and whether the Respondent as the employer is liable to pay him long service leave. In support of this argument, the Applicant referred to the decision of Commissioner Saunders in Brown and Walsh v Broadspectrum. 3

[23] The Applicant is not seeking that the Commission make any determination pursuant to a dispute settlement clause in an enterprise agreement as was the case in Brown and Walsh v Broadspectrum but rather is seeking a recommendation or opinion on the questions that were asked of the Full Bench in Dust-A-Side. The Applicant further states that:

“If the Commission agrees that it has jurisdiction, then the Applicant seeks the Commission’s leave to add the Coal LSL Corporation as a party to this dispute as it considers would be important to have them as a party in any recommendation you may make in relation to the Applicant’s long service leave.”

[24] The Applicant also filed a statement which his legal representative advised he would rely on at the “dispute hearing” 4. Essentially the Applicant states that his Solicitor has been informed by the Respondent that it will not pay his long service leave because the Coal LSL Corporation does not consider he has completed the required qualifying service to be entitled to payment of his pro-rata long service leave. The Applicant goes on to assert that the Coal LSL Corporation does not have records of four previous employers and the Applicant provided information about his employment with those employers attached to the statement. The periods of employment with those employers are said to be May 2001 to February 2002; March 2002 to March 2003; June 2003 to January 2006; and 13 April 2007 to 10 September 2009.

[25] Correspondence from the Applicant’s legal representative to the Respondent dated 21 March 2018 advising that the Applicant is seeking his long service leave payment indicates that the Applicant’s employment with the Respondent ceased on 19 March 2016 and that he claims to have been an eligible employee in the black coal mining industry since May 2001. That correspondence further states that on instructions to his legal representative the Applicant is entitled to payment of 24.1 weeks of long service leave. The letter concludes by stating that if payment is not made by the Respondent, the Applicant will seek orders from the Court in accordance with s. 39DA of the Coal LSL Act.

CONSIDERATION

[26] In Cowley v Dust-A-Side Australia Pty Ltd the issue in dispute was whether the applicant had been dismissed because his position was redundant. The employer contended that the applicant was dismissed for reasons which did not include redundancy. The Full Bench held that:

“[25] As the dispute initiated by Mr Cowley related to the payment of his long service leave on the cessation of his employment with the Respondent, as a result of (on his contention) redundancy, it was a dispute relating to long service leave under Part 5A of the CLSL Act. The dispute concerned two issues: first, whether Mr Cowley ceased “to be an eligible employee because he…is made redundant” and secondly, if so, whether the Respondent was liable to make the long service leave payment. Accordingly, it was a dispute contemplated by s.39D of the CLSL Act. The Deputy President had jurisdiction to deal with the dispute, not by reason of clause 9 of the Award (as she correctly concluded) but as a consequence of s.39D of the CLSL Act. As s.39CB deals with the entitlement to long service leave following the cessation of employment due to redundancy, s.39D has the practical effect of not excluding disputes which arise following the cessation of employment from the Commission’s jurisdiction to deal with a dispute under s.739 of the Act. More specifically, s.39D has the effect of:

• amending s.738 of the Act so that a dispute about coal industry long service leave was a dispute in relation to the NES and to include s.39D(1) as a term; and

• amending the reference to “this Act” in s.739(5) of the Act such that it were a reference to the CLSL Act.

[26] Disputes about an entitlement to long service leave in circumstances of redundancy in the black coal mining industry under the CLSL Act will invariably arise following the cessation of employment. The entitlement is only then crystallised.”

[27] The decisions of Commissioner Saunders in Brown and Walsh v Broadspectrum Limited make clear that the dispute was in relation to whether the applicants were entitled to long service leave in accordance with the Coal LSL Act notwithstanding that they were covered by an enterprise agreement which provided for them to be entitled to long service leave in accordance with the NSW Building and Construction Industry (Portable Long Service Leave) Act 1983.

[28] Both Dust-A-Side and Broadspectrum involved disputes where the resolution of the issue in dispute involved only the direct parties. In Cowley the disputed facts concerned the reasons for termination of the applicant’s employment by the respondent. In Broadspectrum the Commissioner first determined the proper characterisation of the dispute for the purposes of determining whether it fell within the scope of disputes which could be dealt with under the relevant enterprise agreement 5. In a subsequent decision Commissioner Saunders decided not to make a determination as to whether the applicants were eligible employees for reasons including that they had not made an application to take long service leave during their employment with Broadspectrum nor made any request to the Company to be paid in respect of any long service leave entitlement. Further, the Commissioner determined:

“[36] Secondly, there would be no utility in making a determination of whether the Applicants were “eligible employees” within the meaning of the Coal LSL Act when they were employed by Broadspectrum. A determination by me in this arbitration of whether the Applicants were ‘eligible employees’ within the meaning of the Coal LSL Act when they were employed by Broadspectrum would bind the Applicants and Broadspectrum as the parties to the present dispute, but it would not bind third parties such as Centennial Coal, any subsequent employer of the Applicants in the black coal mining industry or the Coal LSL Corporation. That is because the Commission in dispute settlement proceedings under s.739 of the Act can only make a determination binding on the parties to the dispute. Accordingly, if the Applicants in the future made a claim for long service leave under the Coal LSL Act against their current employer (or the Coal LSL Corporation, in the event of insolvency etc. of the employer), in assessing whether or not the Applicants had completed periods of qualifying service (including service with Broadspectrum) that add up to at least six or eight years (as the case may be), neither the current employer nor the Coal LSL Corporation would be bound by my determination in this arbitration of whether the Applicants were ‘eligible employees’ within the meaning of the Coal LSL Act when they were employed by Broadspectrum.”

[29] Notwithstanding that the current proceedings do not involve a determination of a dispute under a dispute settlement term in an enterprise agreement the views of Commissioner Saunders are apposite. It is clear that any claim that the Applicant has in relation to long service leave being payable by the Respondent in the present case, will depend on the determination of facts which relate to his employment with other employers not party to the dispute. It is also clear that the Applicant seeks to make the Coal LSL Corporation a party to the dispute. An opinion or recommendation in relation to whether the applicant has eligible service sufficient that he is eligible for long service leave cannot have any force in relation to non-parties to the dispute.

[30] I do not accept the Applicant’s submission that the present dispute is a dispute of the kind identified in Dust-A-Side. The outcome in the dispute in Dust-A-Side turned on findings of fact in relation to the actions of the direct parties to the dispute. This is not the case in the present matter. As the Full Bench in Dust-A-Side stated, s. 39D of the Coal LSL Act operates on s. 738 and s. 739(5) of the FW Act by:

● Amending s. 738 of the FW Act so that a dispute about coal industry long service leave is a dispute in relation to the NES and to include s. 39D(1) as a term; and

● Amending the reference to “this Act” in s. 739(5) of the Act so that it is a reference to the Coal LSL Act. 6

[31] The extent of the Commission’s power to deal with the present dispute is found in s. 595(2) of the FW Act which provides that the Commission: “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”. Similarly, s. 739(6) of the FW Act provides that the Commission may deal with a dispute only on application of a party. Section 39D of the Coal LSL Act also provides that the Commission may deal with a dispute in relation to long service leave. The provisions give the Commission discretion to decide whether or not to deal with a particular dispute.

[32] In my view this is a case where that discretion should be exercised on the basis that to embark on the process sought by the Applicant would not be an appropriate use of the Commission’s functions and powers with respect to the settlement of disputes.

[33] It is difficult to contemplate logistically how the outcome sought by the Applicant could be achieved in circumstances where a determination of facts is required to be made involving entities not party to the dispute. The facts which the Commission would be required to find in order to found an opinion or recommendation in the Applicant’s favour include whether and in what circumstances the Applicant was employed by entities other than the Respondent in circumstances where those entities are not party to the dispute. It is also logistically difficult to contemplate how the Coal LSL Corporation could be made a party to the dispute. It is arguable that at best the Commission could direct persons other than the parties to the dispute to attend any conference which may be held in relation to the dispute.

[34] In the circumstances of this case it is not necessary to decide this point given my view about the appropriateness of the Commission proceeding as proposed by the Applicant. This is because an opinion or recommendation in terms sought by the Applicant would require the Commission to make findings about matters including:

● Whether the Applicant is an eligible employee as provided in the Coal LSL Act by virtue of service with other employers not party to the present dispute;

● Whether the Applicant’s service with other employers not party to the dispute (if the Applicant had such service) is qualifying service as provided for in the Coal LSL Act; and

● Whether the Coal LSL Corporation has accurately recorded the Applicant’s service.

[35] Leaving aside the legal difficulties associated with making such findings the logistical issues are considerable. A recommendation or opinion is not binding. While I accept that such mechanisms are an important part of the tools that conciliators employ and that a recommendation or opinion of the Commission carries weight with parties to disputes, this cannot be said with respect to non-parties such as the Coal LSL Corporation.

[36] In my view it is also inappropriate to place the Respondent in a position where it is subject to a recommendation or opinion of the Commission in circumstances where the factual basis for the Commission involves non-parties to the dispute. Essentially the Commission would be standing in the shoes of the Coal LSL Corporation and verifying the amount of qualifying service the Applicant had with other employers when his employment with the Respondent ended.

[37] It is also an inappropriate use of the Commission’s dispute settlement powers in circumstances where the Applicant has other mechanisms available to him by which a legally binding outcome, including on non-parties to the present dispute, can be achieved. I do not accept that this conclusion is inconsistent with the function that Parliament intended the Commission would fulfil in settling disputes about long service leave entitlements under the Coal LSL Act. If Parliament had intended to make the Commission the arbiter of such disputes in its own right, it could have done so. It is clear that the powers and functions of the Commission to deal with disputes under the Coal LSL Act are controlled in the same way as the Commission’s powers to deal with disputes under the FW Act.

[38] Even if the Commission had the power to arbitrate the present dispute, for reasons of the kind discussed by Commissioner Saunders in Broadspectrum an arbitrated outcome could not bind non-parties and I would decline to arbitrate on that basis.

CONCLUSION

[39] For these reasons, I decline to deal with the dispute. The application to deal with a dispute is therefore dismissed.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

<PR700361>

 1   Amended F10 Application filed 23 April 2018, Work History, pg 2.

 2   [2016] FWCFB 3220

 3   [2016] FWC 3770.

 4   Statement of William Renton-Power dated 27 April 2018.

 5   [2016] FWC 2004.

 6   [2016] FWCFB 3220 at [25].