Nicholas McWhirter v Endeavour Energy

[2017] FWC 57

[2017] FWC 57

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

Nicholas McWhirter
v
Endeavour Energy
(C2016/1631)

DEPUTY PRESIDENT DEAN SYDNEY, 21 JUNE 2017

Application to deal with a dispute - long service leave accrual.

[1] On 14 July 2016 Mr McWhirter filed an application pursuant to s.739 of the Fair Work Act 2009 (the Act) for the Fair Work Commission (the Commission) to deal with a dispute with Endeavour Energy (Endeavour). The application was made in accordance with clause 29.1 (Dispute Resolution Procedure) of the Endeavour Energy Enterprise Agreement 2012 (the Agreement). The Agreement reached its nominal expiry date on 24 December 2014 but continues to apply.

[2] The dispute relates Mr McWhirter’s accrued long service leave. Mr McWhirter argues that Endeavour has incorrectly applied clause 15 and Annexure D of the Agreement in its calculation of his accrued long service leave, which has resulted in a reduction of his long service leave entitlement under the Agreement.

[3] Mr McWhirter’s application for the Commission to deal with the dispute seeks relief in the following terms:

“That Mr McWhirter’s accrued long service leave be calculated in ‘weeks’ not ‘hours’ and that the correct amount of annual (sic) leave be calculated.”

[4] A number of conferences were conducted between 27 July 2016 and 7 March 2017 and the matter remained unresolved. A hearing took place on 29 March 2017 to determine the dispute. At the hearing, Ms L Andelman of Counsel appeared with Mr R De la Cuadra of the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) on behalf of Mr McWhirter, and Mr G Phillips, solicitor, appeared on behalf of Endeavour.

[5] There was extensive debate as to the question that needed to be answered in order to resolve the dispute. This debate continued at the commencement of the hearing. I am satisfied that answering the question set out below will resolve the dispute between the parties:

Is the period of long service leave of Mr McWhirter from 4 March 1986 (being his start date) to 21 January 2013 (being the date he moved from a 36 hour week to a 40 hour week), (the 36 hour week period), paid at:

a) long service weeks (being 52.9) x current weekly rate of pay (current as at the date of taking/being paid for the leave) OR

b) long service weeks (being 52.9) x current hourly rate of pay (current as at the date of taking/being paid for the leave) x 36

[6] Mr McWhirter contends that the answer to the question is as set out in (a), and Endeavour contends the answer to the question is as set out in (b).

[7] The resolution of the dispute turns upon the interpretation of particular provisions in the Agreement. As a result, I have had regard to the principles applicable to the construction of an enterprise agreement which were canvassed in detail in Australasian Meat Industry Employees Union v Golden Cockerel Pty Ltd 1 (Golden Cockerel).

[8] For the reasons set out below, I determine that the answer to the question is that the 36 hour week period is paid in the manner set out in (b) – that being the number of long service weeks x the current hourly rate of pay x 36.

Agreed matters

[9] Mr McWhirter commenced employment on 4 March 1986. He is currently engaged as a Project Supervisor and has held the position since 21 January 2013. In this decision I have referred to the period between Mr McWhirter’s start date and 21 January 2013 as ‘the 36 hour week period’.

[10] During the 36 hour week period, Mr McWhirter accrued 52.9 weeks of long service leave.

[11] Mr McWhirter’s employment is covered by the Agreement. Annexure D to the Agreement is a workplace arrangement known as ‘Integral Energy Supervisory Employees Workplace Arrangement 2003’ (the WA) which sets out the terms and conditions of employment applicable to supervisory employees. It is agreed that the WA is incorporated into the Agreement by virtue of clause 6 and Appendix D of the Agreement.

[12] The Agreement provides for two types of full-time employees, being those who work 35 hours per week and those who work 36 hours per week. Supervisory employees covered by the WA work 40 hours per week.

[13] On 21 January 2013 Mr McWhirter became a supervisor and his weekly hours of work increased from 36 to 40 hours per week.

[14] From 21 January 2013, Mr McWhirter continued to accrue long service leave at the rate of the number of weeks set out in clause 15.1, based on a 40 hour working week.

[15] As at the date of the hearing, Mr McWhirter has accrued an entitlement to some 61 weeks of long service leave.

[16] Mr McWhirter has not taken any long service leave and has been a full-time employee for the duration of his employment.

[17] The relevant provisions of the Dispute Resolution Procedure have been followed and I am able to determine the dispute by arbitration.

Relevant Provisions of the Agreement

[18] The following clauses of the Agreement are relevant to the current dispute.

[19] Clause 15.1 of the Agreement provides the quantum of long service leave as follows:

15.1 Quantum

BASIS OF ACCRUAL	QUANTUM
After 10 years	13 weeks	(455 hours or 468 hours)
After 15 years	an extra 8.5 weeks	(297.5 hours or 306 hours)
After 20 years	An extra 13.5 weeks	(472.5 hours or 486 hours)
After each additional 5 years	An extra 13 weeks	(455 hours or 468 hours)

[20] Clause 14 (Leave Accruals) of the WA provides:

“Leave accrued in relation to annual and long service leave, by Supervisory employees will be based on a 40 hour week.

Full time employees whose working hours increase as a result of appointment to this Arrangement will have their annual leave accrued balances adjusted to reflect their new working arrangements. Any subsequent reduction in working hours will result in the above adjustment (in hours) being reversed. There will be no further adjustments to any other leave types as a result of appointment to this arrangement.”

Competing contentions

Number of weeks of long service leave

[21] On behalf of Mr McWhirter, it was contended that his accrued long service leave entitlement had been reduced as a result of changes Endeavour had implemented to identify and record an employee’s accrued long service leave entitlement. The ‘change’ referred to here is that payslips of employees show the long service leave entitlement in hours, and not weeks. This change apparently occurred in or around 1997.

[22] Mr McWhirter said that if he divided the number of hours of his long service leave balance shown on his payslip by 40 (being 40 hours per week), this equated to a balance of 55.75 weeks long service leave, which was incorrect because he was actually entitled to 61 weeks of long service leave at that point in time.

[23] Endeavour, in its written submissions filed on 20 March 2017 and during the course of the hearing, agreed that Mr McWhirter had accrued 61 weeks of long service leave pursuant to clause 15.1 of the Agreement, and not 55.75 weeks. It acknowledged that its payroll system converts the number of weeks of long service leave an employee had accrued into hours, in this case using a divisor of 36 for the 36 hour week period.

[24] Notwithstanding the manner in which the long service leave is displayed on a payslip, there is no dispute between the parties that long service leave accrues based on a set number of weeks per period of service, as set out in clause 15.1 of the Agreement. Given there is no dispute about the number of weeks of long service leave accrued by Mr McWhirter, there is nothing I need to determine in relation to this issue.

[25] The issue that does arise is the role of the reference to ‘hours’ set out in brackets in clause 15.1 under the heading of Quantum. For example, “13 weeks (455 hours or 468 hours)”. There is no dispute between the parties that the first reference to hours in brackets (455 hours in this example) is a reference to a 35 hour week employee, and the second reference to hours in brackets (468 hours in this example) is a reference to a 36 hour week employee.

Construction of the Agreement – Mr McWhirter’s view

[26] Mr McWhirter submitted that the relevant parts of the Agreement, that being clause 15.1 and clause 14 of the WA, have a plain meaning and no ambiguity arises.

[27] Mr McWhirter contended that long service leave under the Agreement is not accrued based on the number of hours worked in each week, and “there is nothing in clause 15.1 of the Agreement that states that accrual is based on hours worked or that if an employee moves from being a 35 hour per week employee to a 36 hour a week employee, their accrual of long service leave will change, will be frozen or will be averaged in some way” 2.

[28] Mr McWhirter argued that the plain meaning of clause 15.1 is that at the time an employee comes to take long service leave, the person will be entitled to take the number of weeks accrued at the current ordinary time earnings 3.

[29] In relation to the meaning of clause 15 of the Agreement, Mr McWhirter submitted as follows 4:

a. clause 15.1 contains a table with 2 columns;

b. the left-hand column sets out the basis on which long service is accrued and the right-hand column sets out the amount of long service leave accrued;

c. the reference to hours in the closed brackets is the amount of leave payable to an employee depending on the number of hours worked, and the number of hours that appear in brackets are hours for employees who work 35 and 36 hours respectively;

d. the basis of the accrual is on the number of years worked;

e. it accrues irrespective of whether a person is a full-time, part-time or a casual employee;

f. the only basis for the accrual is the length of service, and this is entirely uncontroversial and consistent with the history of long service leave accrual for employees in New South Wales, and is the same method by which long service leave accrues under the Long Service Leave Act 1955 (the LSL Act);

g. the amount of long service leave accrued under clause 15.1 depends on the person’s hours worked. For example “a person who is a part-time employee after 10 years would be entitled to 13 weeks at however many hours they work during this period. Likewise for a person who performs 35 or 36 hours per week”; and

h. the person’s hours worked is calculated by the date immediately preceding the date on which that person enters, or is deemed to have entered upon long service leave.

[30] The meaning of clause 14 of the WA, as contended on behalf of Mr McWhirter, was as follows 5:

a. clause 14 provides that the amount of long service leave is based on a 40 hour week. That is, at the time the long service leave becomes due, the amount of leave will be calculated on a 40 hour week, and not on a 38 or 36 hour week for example. The weekly rates of pay applicable are as set out in clause 8 of the WA;

b. the second paragraph of clause 14 has “a plain reading and is applicable to Mr McWhirter, that is, when he became covered by Annexure D, his working hours increased and as such his annual leave accrued balances were adjusted from the date of his appointment. Annual leave, unlike long service leave accrues according to the employees ordinary hours of work”;

c. Endeavour has conflated the entitlement which is based on length of service with the recording of the ordinary pay as has been done for annual leave;

d. Endeavour changed its administrative system some time ago “which seems to have confused the hours worked with the length of period calculations”;

e. as a result, Mr McWhirter has had his length of service for the purpose of long service leave reduced.

[31] He argued that this interpretation is consistent with the industrial context and purpose of long service leave entitlements and is “beneficial to the beneficiaries of the provisions”. 6

[32] It was argued on behalf of Mr McWhirter that the interpretation of the Agreement urged upon me by Endeavour, was a “radical departure from the construction of the agreement as a whole within the jurisdiction framework. It is industrially unreal, in my submission … It bears no reality as to the context. It is unreasonable conflation of the reasoning” 7. This ‘conflation’ was said to be that the number of hours worked by an employee impacted on the accrual of long service leave.

[33] During the course of the hearing I asked Ms Andelman for submissions on the role the reference to hours played in clause 15.1 of the Agreement. Her answer was to the effect that Endeavour had introduced a new payroll system that allowed them to record hours rather than weeks 8. In response to a further question from me as to whether the CEPU (as a negotiating party to the Agreement) thought the reference to hours had a role to play other than as part of Endeavours payroll system, Ms Andelman said “I think there was an agreement that payroll can record in hours and there’s nothing wrong with an employer recording hours for long service leave in a payroll system”9.

Construction of the agreement – Endeavour’s view

[34] In its written submissions and during the hearing before me, Endeavour confirmed that Mr McWhirter had 61 weeks of long service leave accrued in accordance with clause 15.1 of the Agreement.

[35] Endeavour contended that the relevant provisions of the Agreement and WA were clear and unambiguous. By reference to Golden Cockerel and Kucks v CSR 10 (Kucks) it submitted that11:

a. if the words used in the relevant clauses were clear and unambiguous, no regard is to be given to surrounding circumstances;

b. ordinary well understood words are in general to be accorded the ordinary or usual meaning; and

c. in addition, “a court is not free to give effect to some anteriorly derived notion of what would be fair or just, regardless of what has been put into an award” 12

[36] Endeavour submitted that clause 15.1 of the Agreement sets out the basis of how long service leave is accrued, being the accrual of weeks of long service leave by reference to years of service. Critically, Endeavour submitted, the clause clearly differentiated the entitlement between a 35 hour per week employee and a 36 hour per week employee, that being the number of hours shown in brackets next to the quantum of weeks of accrued entitlement to long service leave. It argued that this was important because it demonstrated that for each week of long service leave accrued, the payment or hours will be different depending on an employee’s status as at 35 or 36 hour per week employee. This is notwithstanding that each employee still accrues the same number of weeks of long service leave.

[37] The Agreement does not deal specifically with employees who work 40 hours per week. This is dealt with in the WA.

[38] In relation to clause 14 of the WA, Endeavour contended that if properly construed, this clause means that once a person becomes a supervisor, his or her annual and long service leave begins to accrue from that date onwards on the basis of 40 hours per week.

[39] It contended that clause 14 provides for the adjustment of accrued annual leave balances of employees reflecting their 40 hour per week engagement. The clause goes on to say that “there will be no further adjustments to any other leave types as a result of appointments to this arrangement”. Endeavour argued that in accordance with Kucks, these words must be given their ordinary or usual meaning. In this case the clause meant that while an annual leave balance would be adjusted, no other form of leaves (such as long service leave) would be adjusted. It was submitted that this meant that the ‘entitlement’ to long service leave accrued as at 21 January 2013 remains as in accordance with clause 15.1 of the Agreement. Further, Endeavour submitted that while Mr McWhirter accrued his entitlement to weeks of long service leave in accordance with clause 15.1, all that clause 14 of the WA did thereafter was to leave untouched the accrued bank of long service leave which existed immediately prior to the appointment under the WA. This meant that the bank of long service leave for the 36 hour week period is based on a 36 hour per week accrual.

[40] Endeavour argued that the effect of Mr McWhirter’s interpretation of the relevant provisions meant that he was attempting to have his bank of long service leave which had accrued at 36 hours per week recalculated as having accrued as if he had worked 40 hours per week for the entirety of his service with Endeavour. This is the outcome if the answer to the question I need to determine is (a).

[41] Endeavour further contended that this type of unjust enrichment is the type of injustice that the decision in Kucks says needs to be avoided, and that clause 14 of the WA was specifically drafted to avoid this unfair result.

[42] Endeavour contended that there were a number of difficulties with the interpretation put forward by Mr McWhirter including that it was directly contrary to how accrued balances are dealt with in clause 14 of the WA, that it offended the No Extra Claims clause of the Agreement, and that it invited the Commission to make a decision inconsistent with the Agreement and contrary to s.739(5) of the Act by ignoring the clear words of clause 14 and having Mr McWhirter’s entire long service leave calculated on a different basis.

Relevant authorities

[43] Counsel on behalf of Mr McWhirter referred to a number of decisions which I have considered. Particular reliance was placed on a decision of a Full Bench of the Commission in Armacell Australia Pty Ltd and anor 13(Armacell), as authority for the proposition that where a term of an enterprise agreement is inconsistent or different to a term of the LSL Act, then that provision had no effect and was unenforceable14.

[44] Endeavour submitted that the circumstances arising in Armacell were distinguishable in two important ways. First, Armacell dealt with a situation where there was no applicable award derived long service leave terms and there was no dispute that the Victorian long service leave legislation applied to those employees. Second, Armacell also dealt with a second group of employees for whom there were applicable award derived long service leave terms pursuant to a federal long service leave award. The relevant consideration in relation to the second group of employees was whether the relevant agreement terms were less beneficial than the award terms having effect as a National Employment Standards (NES) term.

[45] I do not consider the decision in Armacell to be authority for the proposition as put on behalf of Mr McWhirter. I agree with submissions made by Endeavour in relation to the matters which distinguish it from the dispute I need to determine.

Legislative background and relevance of the Long Service Leave Act 1955 (LSL Act)

[46] Mr McWhirter argued that the manner in which long service leave accrues is a relevant context that should be considered, and “in New South Wales, the accrual of long service leave has been and continues to be pursuant to the Long Service Leave Act 1955 …” 15.

[47] It was also contended on behalf of Mr McWhirter that the absence of a reference to the LSL Act in the Agreement is because “it is so fundamental, it goes without saying” 16. This was asserted on the basis that the provisions in clause 15 were not comprehensive and exhaustive.

[48] Endeavour submitted that the relevant source of Mr McWhirter’s long service leave entitlement was the Agreement and the WA, and as a result, I need only have regard to the Agreement and the WA in determining this matter. It argued that I would fall into error if I were to consider the terms of the LSL Act. In this submission, Endeavour relied on s.113 of the Act, which provides:

113 Entitlement to long service leave

Entitlement in accordance with applicable award-derived long service leave terms

(1) If there are applicable award-derived long service leave terms (see subsection (3)) in relation to an employee, the employee is entitled to long service leave in accordance with those terms.

Note: This Act does not exclude State and Territory laws that deal with long service leave, except in relation to employees who are entitled to long service leave under this Division (see paragraph 27(2)(g)), and except as provided in subsection 113A(3).

(2) However, subsection (1) does not apply if:

(a) a workplace agreement, or an AWA, that came into operation before the commencement of this Part applies to the employee; or

(b) one of the following kinds of instrument that came into operation before the commencement of this Part applies to the employee and expressly deals with long service leave:

(i) an enterprise agreement;

(ii) a preserved State agreement;

(iii) a workplace determination;

(iv) a pre-reform certified agreement;

(v) a pre-reform AWA;

(vi) a section 170MX award;

(vii) an old IR agreement.

Note: If there ceases to be any agreement or instrument of a kind referred to in paragraph (a) or (b) that applies to the employee, the employee will, at that time, become entitled under subsection (1) to long service leave in accordance with applicable award-derived long service leave terms.

(3) Applicable award-derived long service leave terms, in relation to an employee, are:

(a) terms of an award, or a State reference transitional award, that (disregarding the effect of any instrument of a kind referred to in subsection (2)):

(i) would have applied to the employee at the test time (see subsection (3A)) if the employee had, at that time, been in his or her current circumstances of employment; and

(ii) would have entitled the employee to long service leave; and

(b) any terms of the award, or the State reference transitional award, that are ancillary or incidental to the terms referred to in paragraph (a).

(3A) For the purpose of subparagraph (3)(a)(i), the test time is:

(a) immediately before the commencement of this Part; or

(b) if the employee is a Division 2B State reference employee (as defined in Schedule 2 to the Transitional Act)—immediately before the Division 2B referral commencement (as defined in that Schedule).

…

[49] Endeavour argued that for the purpose of s.113(3)(a)(ii) of the Act, the Integral Energy Award 2008 (the Award), applicable at the relevant time, entitled Mr McWhirter to long service leave for the following reasons 17:

a) If s.113 applies, an employee’s entitlement to long service leave is akin to a national employment standard and is derived from the Act. The relevant State long service leave legislation has no effect by virtue of s.26 and s.27(2)(g) of the Act;


b) as a State Owned Corporation, Endeavour was not a constitutional corporation and remained within the New South Wales industrial relations system at ‘the test time’ for the purpose of s.113 of the Act, being 31 December 2009. The referral by the New South Wales State Government to the Commonwealth took effect on 1 January 2010;


c) prior to 2011, Endeavour was known as Integral Energy, and on 31 December 2009 the Award had effect;


d) section 113(7) of the Act provides that the kind of instruments included in s.113 are transitional instruments continued in existence by Schedule 3 to the Fair Work (Transitional Provisions and Consequential Amendments) Act.

[50] The effect of these matters, in Endeavour’s submission, is that the LSL Act is effectively ousted in its entirety by s.113 of the Act.

[51] In response to Endeavour’s submissions on s.113 of the Act, it was argued on behalf of Mr McWhirter that “any award derived long service leave terms cannot be interpreted in a manner which is less beneficial to the applicant that (sic) the long service leave legislation in NSW, namely Long Service Leave Act 1955 (NSW) (LSL Act)” 18. Further it was submitted that “it was not the intention of the drafters of the Act to allow the applicable award derived long service leave terms to undercut the provisions of the LSL Act or allow agreements made under the Act to undercut LSL legislation”19.

[52] In support of this submission, Mr McWhirter relied on paragraphs of the Explanatory Memorandum to the Fair Work Bill 2009 20, which I have considered and are not repeated here. Also relied on was the Armacell decision, which held that “a term of an enterprise award which purports to reduce an entitlement under State long service leave legislation has no legal effect …”.

[53] Endeavour also argued that the long service leave provisions in the Agreement had effect because of s.55 of the Act. Section 55(3) provides that “the National Employment Standards have effect subject to terms included in a modern award or enterprise agreement as referred to in subsection (2)”.

[54] Endeavour submitted that the long service leave provisions in the Award (having effect as an NES entitlement) are identical to the long service leave provisions of the Agreement (supplemented by the WA). Therefore, the relevant source of Mr McWhirter’s long service leave entitlement is the Agreement and the WA.

[55] In the alternative, Endeavour argued, the effect of what Mr McWhirter was seeking was for the Commission to effectively exercise judicial power by making a ruling in relation to the legal effect of the LSL Act, which was not an allowable matter for a private arbitration.

[56] In response to this submission by Endeavour, Mr McWhirter contended that the Commission could resolve his dispute without entering into a judicial task of interpreting the LSL Act, “because the task at hand is dealing with the dispute which is the meaning of clause 15 of the Agreement and clause 14 of Annexure D to the Agreement” 21.

The role of Endeavours Leave Policy

[57] It was further submitted by Mr McWhirter that if the LSL Act did not apply, then Mr McWhirter relied on clause 5.12.1 of Endeavours’ Leave Policy 22. Clause 5.12.1 of the Leave Policy provides as follows:

“Employees who have accrued the minimum number of years working with the company in accordance with the Long Service Leave Act 1955 (NSW) and the company’s Enterprise Agreement or Contract of Employment are entitled to Long Service Leave.”

Consideration and conclusion

[58] The principles applicable to the construction of an enterprise agreement have been canvassed at length in Golden Cockerel. It is not necessary that they be repeated here. They are not in dispute and as indicated earlier, I apply them to the construction of the relevant provisions of the Agreement as required to resolve this dispute.

[59] The submissions filed on behalf of Mr McWhirter on 27 March 2017 confirmed that he continued to rely on earlier submissions filed on 28 November 2016 and on 10 January 2017. Even though I may not have specifically referred to all of the matters set out in the submissions, I have had regard to them in coming to my conclusion.

[60] There is no material before me which would contradict Endeavour’s submissions set out in paragraph 49 regarding its status as a non-constitutional corporation and the status of the Award by reference to s.113 at the relevant time. As a result, I accept the submissions made by Endeavour in this regard, and consequently accept that s.113 operates to exclude the LSL Act.

[61] I do not accept the submissions on behalf of Mr McWhirter that the absence of a reference to the LSL Act in the Agreement was because it’s applicability “was so fundamental that it goes without saying’. If the parties intended to have regard to the LSL Act, in my view they would have specifically said so. The determination of the entitlement of long service leave can be done by reference to clause 15 and the WA - there is no need to refer to the LSL Act in order to determine the entitlement of an employee as to long service leave.

[62] I do not consider, as contended by Mr McWhirter, that this results in a reduction of his entitlement to long service leave, or that his entitlement to long service leave is therefore ‘undercut’ by the provisions of the Agreement. There is no dispute between the parties that the Agreement provides Mr McWhirter, based on his years of service, with some 61 weeks of long service leave. If the LSL Act applied, Mr McWhirter would be entitled to less than half this amount. There is no basis in my view to find that the Agreement reduces Mr McWhirter’s entitlement to long service leave.

[63] I am satisfied that the Agreement provides “applicable award derived long service leave terms” and that Mr McWhirter is entitled to long service leave in accordance with those terms. There is no basis for me to have recourse to the LSL Act in determining this dispute.

[64] The parties agreed that this dispute arises from clause 15.1 of the Agreement and clause 14 of the WA 23. The dispute does not arise in relation to the applicability or otherwise of the Leave Policy. There is no basis for me to take account of the Leave Policy in determining this dispute. The Leave Policy is not part of the Agreement and does not affect the manner in which the Agreement is to be construed.

[65] My task in interpreting the Agreement is that of interpreting the Agreement produced by the parties, and does not involve rewriting the Agreement to achieve what might be regarded as a fair or just outcome 24.

[66] I find that the plain meaning of clause 15 of the Agreement combined with clause 14 of the WA leads to the interpretation contended by Endeavour. Given that the words are clear and unambiguous, I do not need to have regard to evidence surrounding circumstances given the plain language of the Agreement. Further, the common intention of the parties, by reference to that which a reasonable person would understand by the language the parties have used to express their agreement, also supports the interpretation contended by Endeavour. There are a number of reasons for this conclusion.

[67] First, the wording in clause 14 of the WA is clearly prospective in its application. The clause provides that leave accrued in relation to supervisory employees will be based on a 40 hour week.

[68] Second, Clause 14 of the WA is also clear in that only annual leave balances for employees who move to a 40 hour week will be adjusted to reflect the new working arrangement, and ‘no further adjustments to any other leave type will be made’. In my view, the parties would understand that the reference to other leave types to include long service leave. This is particularly so where a reference to long service leave appears in the first sentence of this clause.

[69] Third, the effect of Mr McWhirter’s contention is that Endeavour would be required to provide a long service leave entitlement as if the whole of his employment had been worked at 40 hours per week. This contention cannot be correct, and in my view does not accord with the plain meaning of the language used in this clause.

[70] Fourth, I reject the argument of Mr McWhirter that the reference to hours in clause 15 of the Agreement is only reference to an administrative arrangement relating to Endeavour’s payroll system. The hours referred to in clause 15 relate to the quantum of the entitlement for employees working a 35 or 36 hour week. It is evident that the intention of the parties by including hours was to distinguish the long service leave entitlement of the different types of full time employees.

[71] Fifth, in my view it is clear that the reference to hours relate to the basis for payment of the weeks of long service leave accrued, not the accrual of long service leave itself. In this regard I accept the submissions of Endeavour to the effect that the reference to hours demonstrates a clear recognition that payment for long service leave will be different depending on the status of an employee as a 35 or 36 hour per week employee. This is notwithstanding that each employee still accrues the same number of weeks of long service leave.

[72] I find that the interaction between clause 15 of the Agreement and the WA provides an outcome in which Mr McWhirter’s long service leave balance for the 36 hour week period (ending on 21 January 2013) remains as it had been accrued in accordance with clause 15 of the Agreement as at that date. I accept the submissions of Endeavour on the effect of clause 14 of the WA, in that the WA leaves untouched the accrued bank of long service leave which existed immediately prior to Mr McWhirter’s appointment under the supervisors arrangement (ie the WA).

[73] There is no doubt that the applicant’s entitlement to long service leave changed after 21 January 2013 when he moved to a supervisory position and a 40 hour week, however this change was prospective and did not affect any entitlement he had already accrued whilst working a 36 hour week. In my view, this is the clear intention of clause 14 of the WA, and I so find.

[74] For the reasons set out above, I find that the answer to the question I am required to determine is (b) - the payment for the 36 hour per week period is to be paid at 52.9 weeks x the applicable hourly rate of pay x 36. The dispute is determined accordingly.

DEPUTY PRESIDENT

Appearances:

L Andelmanof counsel with R De La Cuadra for Nicholas McWhirter.

G Phillips for Endeavour Energy.

Hearing details:

2017.

Sydney:

March 29.

 1   [2014] FWCFB 7447.

 2   McWhirter’s submissions of 27 March 2017 at paragraph 14.

 3   Ibid at paragraph 11.

 4   McWhirter’s submissions of 28 November 2016 at paragraphs 14 to 20.

 5   Ibid at paragraphs 22 to 27.

 6   McWhirter’s submissions of 27 March 2017 at paragraph 20.

 7   Transcript PN 137.

 8   Transcript PN 141.

 9   Transcript PN 143.

 10 (1996) 66 IR 182.

 11   Endeavour’s submissions of 20 March 2017 at paragraph 25

 12 (1996) 66 IR 182 at 184.

 13   [2010] FWAFB 9985

 14   Transcript PN 227.

 15   McWhirter’s submissions of 28 November 2016 at paragraph 11

 16   Transcript PN 168.

 17   Endeavour’s submissions of 20 March 2017.

 18   McWhirter’s submissions of 27 March 2017 at paragraph 26.

 19   Ibid at paragraph 28.

 20   Explanatory Memorandum to the Fair Work Amendment Bill 2012 at [46] and [55].

 21   McWhirter’s submissions of 10 January 2017 at paragraph 49

 22   McWhirter’s submissions of 27 March 2017 at paragraph 27.

 23   See for example Mr McWhirter’s submissions of 28 November 2016 at paragraph 6.

 24   See [2014] FWCFB 7447.

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