Oktay Guner v Cranbourne Transit Pty Ltd T/A Cranbourne Transit

[2018] FWC 327

[2018] FWC 327

The attached document replaces the document previously issued with the above code on 16 January 2018.

The document has been edited to amend endnote [6].

Alexa Kuzyk

Associate to Commissioner Gregory

Dated 17 January 2018

[2018] FWC 327

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

Oktay Guner
v
Cranbourne Transit Pty Ltd T/A Cranbourne Transit
(C2017/2558)

COMMISSIONER GREGORY MELBOURNE, 16 JANUARY 2018

Alleged dispute in relation to accident make-up pay.

Introduction

[1] Mr Oktay Guner is employed as a bus driver by Cranbourne Transit Pty Ltd T/A Cranbourne Transit (“Cranbourne Transit”) and has worked with the business since late 2010. Prior to sustaining an injury at work he was typically working on average around 50 hours each week.

[2] His terms and conditions of employment are covered by the Cranbourne Transit Pty Ltd Enterprise Agreement 2014 1(“the Agreement”).

[3] In August 2016, Mr Guner was injured at work and subsequently lodged a WorkCover claim which has since been approved. However, a dispute has now arisen about the entitlement to accident make-up pay. Mr Guner submits the entitlement is dealt with comprehensively by clause 13 of the Agreement, which make no reference to the exclusion of overtime earnings in determining what average weekly earnings are. However, Cranbourne Transit submits that the Agreement also incorporates the terms and conditions contained in the former Transport Workers (Passenger Vehicles) Award 2002 2 (“the 2002 Award”), and it specifically excludes overtime earnings from any calculation of the ordinary rate of pay for the purposes of assessing the entitlement to accident make-up pay.

[4] The application was dealt with in conference on 30 May 2017, but was unable to be resolved. It was accordingly set down for hearing, with directions issued for filing and service of evidence and submissions.

[5] Ms Glenys Jardine of Counsel was given permission to appear on behalf of Mr Guner under s.596(2)(a) of the Fair Work Act 2009 (Cth) (“the Act”) as the matter involves a degree of complexity and her involvement might enable it to be dealt with more efficiently. Mr Ian MacDonald of the Australian Public Transport Industrial Association appeared on behalf of Cranbourne Transit.

The Issue to be Determined

[6] Clause 13 of the Agreement states:

“13. Accident Pay Make-Up

13.1 This clause shall apply to all employees other than casuals covered by this Agreement and it shall apply only is respect of incapacity which results from an injury received on or after the date of operation of this Agreement.

13.2 The circumstances under which an employee shall qualify for accident make-up payment shall be as prescribed hereunder:

(a) The employer shall pay an employee accident make-up payment where the employee receives an injury for which weekly payment or compensation is payable by or on behalf of the employer pursuant to the provisions of the Accident Compensation Act 1985 as amended from time to time.

(b) Accident make-up payment shall not apply in respect of any injury during the first ten normal working days of incapacity as the employer is responsible to pay 100 % Workers Compensation as per the Act.

(c) The employer shall pay or cause to be paid accident make-up payment during the incapacity of the employee within the meaning of the said Act until such incapacity of the employee within the meaning of the said Act ceases or until the expiration of 39 weeks from the date of injury, whichever event shall occur first.” 3

[7] However, clause 6 of the Agreement also makes reference to the incorporation of terms and conditions contained in Part C of the Transport Workers (Passenger Vehicles) Award 2002 (“the 2002 Award”). It states:

“6. Incorporated terms and conditions

6.1 The terms and conditions contained in the Transport Workers (Passenger Vehicles) Award 2002 Part C (Award – Part C) as amended and attached in full in Schedule A shall be deemed to be incorporated into this Agreement except:

(a) to the extent that they conflict with the terms and conditions contained in the main body of this Agreement; and

(b) the Dispute Settlement clause contained in the Award – Part C which is superseded by clause 12 of the main body of this Agreement.

6.2 To avoid any doubt, any disputes regarding the interaction of the Parent Award, Award – Part C, and the main body of this Agreement, or over the application of the Parent Award, Award – Part C or the main body of this Agreement shall be dealt with in accordance with the dispute resolution procedure contained in clause 12 of the main body of this Agreement.” 4

[8] Clause 24 of the 2002 Award deals with Accident Pay Make-Up. The critical wording in the context of the present dispute is contained in sub clause 24.2.2. However, the clause states in full:

“24. ACCIDENT PAY MAKE-UP

24.1 This clause shall apply to all employees other than casuals covered by this Award and it shall apply only in respect of incapacity which results from an injury received on or after the date of operation.

24.2 The circumstances under which an employee shall qualify for accident make-up payment are as follows:

24.2.1 An employer shall pay an employee accident make-up payment where the employee receives an injury for which weekly payment or compensation is payable by or on behalf of the employer pursuant to the provisions of the appropriate compensation legislation as amended from time to time.

24.2.2 “Accident make-up payment” means a weekly payment of an amount being the difference between the weekly amount of compensation paid to the employee pursuant to the appropriate compensation legislation and the employee’s ordinary rate of pay excluding overtime.

24.2.3 Accident make-up payment shall not apply in respect of any injury during the first ten normal working days of incapacity.

24.2.4 An employer shall pay or cause to be paid accident make-up payment during the incapacity of the employee within the meaning of the appropriate compensation legislation until such incapacity of the employee within the meaning of the appropriate compensation ceases or until the expiration of 39 weeks from the date of injury whichever event shall occur first.” 5

[9] As indicated, the critical difference between the wording in the main body of the Agreement, and the wording in the attached 2002 Award, are the words in sub clause 24.2.2, which specifically excludes overtime earnings from the definition of an “employee’s ordinary rate of pay.” No such exclusion is contained in clause 13 of the Agreement. The Commission is accordingly now required to determine whether clause 13 in the main body of the Agreement stands alone, and deals comprehensively with the entitlement to accident make-up pay, or whether the clause is to be read in conjunction with sub clause 24.2.2 in the attached 2002 Award.

The Evidence and Submissions

Mr Oktay Guner’s Submissions

[10] In August 2016, Mr Guner was injured at work and he subsequently lodged a WorkCover claim on 20 November 2016. On 15 December Cranbourne Transit’s Insurer informed Mr Guner that he was entitled to weekly payments based on his pre-injury average weekly earnings. Mr Guner claims those pre-injury average weekly earnings at the time were $1,588.00, which included a regular overtime component of $589.00. From 14 October 2016, the Insurer commenced to pay Mr Guner 95% of his pre-injury average weekly earnings, which it assessed at $1,509.00 per week.

[11] In the first ten days after his injury Cranbourne Transit paid the full amount of Mr Guner’s pre-injury average weekly earnings, including the overtime component. However, it has since refused to pay the difference between the amount paid by the Insurer and the full amount of his pre-injury average weekly earnings.

[12] In terms of how the respective provisions in the Agreement and the attached 2002 Award are to be interpreted, Mr Guner submits the Award contains a more narrow definition of the accident make-up pay obligation than the Agreement. The wording in the Agreement is therefore in conflict with the Award. He accordingly submits the terms of clause 13.2 in the Agreement operate in place of clause 24.2.2 in the attached 2002 Award by virtue of sub clause 6.1(a) in the main body of the Agreement.

[13] His overtime earnings should therefore not be excluded in determining what his average weekly earnings are when assessing the entitlement to accident make-up pay. His entitlement to accident make-up pay should therefore represent the difference between the amount paid by the Insurer and his pre-injury average weekly earnings, including the regular overtime component, and this amount should have been paid for the period of 39 weeks from the date of his injury.

[14] Mr Guner also make reference to the Full Bench decision in Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union, known as the Australian Manufacturing Workers Union (AMWU) v Berri Pty Ltd 6(“Berri”) and, in particular, the principles set out at paragraphs 113 and 114 of that decision.

[15] He acknowledges that clause 13 does not contain a definition of average weekly earnings in terms of the obligation to provide accident make-up pay, whereas in the attached 2002 Award it is clearly referable only to the ordinary rate of pay, excluding overtime. However, in all other respects the clauses are identical. Therefore, at some stage in the agreement making process the definition which excluded overtime earnings was deleted. Mr Guner continues to submit that the decision in Berri makes clear that the task of interpreting an Agreement does not involve rewriting the document. In addition, the Commission is required to look at the intention of the parties, based on an objective test, rather than on the basis of their subjective views about what the clause should mean.

[16] He also submits that the exclusion of the definition cannot be explained as simply an inadvertent omission, given that the obligation of the employer to pay for the first ten days following an injury, and the definition of pre-injury average weekly earnings, including paid overtime, reflect what is contained in the relevant State based workers’ compensation legislation. He submits that the change in the wording, and the deletion of the overtime exclusion, accordingly demonstrate from an objective point of view that it was the intention of the parties that accident make-up pay now be based on the total amount of pre-injury average weekly earnings as provided for in the applicable State based legislation, which includes any regular overtime component.

[17] Mr Guner continues to submit that the wording in the Agreement is not ambiguous. However, he submits in the alternative that if the Commission finds there is ambiguity, and considers it necessary to have regard to the evidence of the surrounding circumstances, then it is relevant to have regard to the evidence indicating that at least five of the thirteen metropolitan bus companies in Melbourne provide accident make-up pay entitlements based on the full amount of an employee’s pre-injury average weekly earnings, including any regular overtime component.

[18] Mr Guner also rejects the suggestion that the definition of “accident make-up payment” was not included in clause 13 because it was already set out in clause 24 in the attached 2002 Award. He submits, in response, that if this were the case then there would have been no need to include clause 13 in the Agreement at all because it would have no work to do. He submits that clause 13 was instead included because it was intended to replace clause 24.

Mr Oktay Guner

[19] Prior to sustaining his injury Mr Guner was typically working between 40 and 60 hours per week. His pre-injury average weekly earnings were calculated to be $1,588.00, including the overtime component of $589.00. While in receipt of WorkCover payments, he received his pre-injury average weekly earnings amount, less 5% for the first period of 13 weeks, and the total amount was then reduced by 20%. Mr Guner is currently receiving 80% of his pre-injury average weekly earnings each week.

Mr Robert Lean

[20] Mr Lean is an Organiser with the Transport Workers’ Union. He indicated in his witness statement, “To my understanding, it is industry practice to pay the reduction difference under the WorkCover legislation, including all the overtime, shift allowances and penalty rates.” 7 He also stated that Cranbourne Transit “… is the only company that I am aware of that takes the view that the overtime is not payable when paying accident make up pay.”8

[21] Mr Lean also indicated in his examination in chief that the current Agreement was a rollover from previous enterprise agreements, and was based on a template that had broad application in the bus industry.

[22] He also provided details in cross examination of the businesses, and the contacts at those businesses, he had spoken to in regard to his understanding about it being industry practice to include overtime payments in the calculation of average weekly earnings for the purposes of assessing the entitlement to provide accident make-up pay.

Cranbourne Transit

[23] Cranbourne Transit submits, in response, that the relevant weekly earnings amount for the purposes of establishing the obligation to provide accident make-up pay is the sum of $1022.00, being the amount attributable to Mr Guner’s ordinary hours of work, excluding any earnings attributable to overtime. It refers, firstly, to sub clause 6.1 of the Agreement, which indicates that the terms and conditions in the attached 2002 Award are incorporated into the Agreement, except to the extent they conflict with the terms and conditions contained in the main body of the Agreement. It submits there is no conflict between the Agreement and the attached Award because there is no explicit wording in the main body of the Agreement which is in conflict with paragraph 24.2.2 of the attached 2002 Award. Paragraph 24.2.2 is therefore incorporated into the Agreement.

[24] It does acknowledge that sub clause 13.2(a) of the Agreement sets out the obligation to provide accident make-up pay. However, as there is no definition of what accident make-up pay is to constitute in the main body of the Agreement it relies on sub clause 24.2.2 of the attached 2002 Award to provide this definition. This refers explicitly to the “ordinary rate of pay excluding overtime.” 9 It submits it was therefore never intended that clause 13 be read on its own, and it was always intended instead that it be read in conjunction with the definition in sub clause 24.2.2.

[25] In its submission there is no contradiction between clause 13 and clause 24, and the definition in the attached 2002 Award simply assists with the interpretation of the clause in the main body of the Agreement. It makes clear that it was intended to limit the obligation to provide make-up pay to earnings from ordinary time hours of work, excluding overtime. It also notes in this context that it was always intended by the parties that the attached 2002 Award would continue to have application, despite the fact it would no longer continue to operate as a consequence of the process of Award Modernisation.

[26] It also points to the evidence of Mr Peter Kavanagh, in particular, regarding the practice of other employers who have adopted the template agreement, and base their obligation to provide accident make-up pay on earnings from ordinary hours of work, excluding earnings from overtime.

[27] It also makes reference to the decision of Senior Deputy President Kaufmann in United Voice v Schweppes Australia Pty Ltd 10 (“Schweppes Australia”), and to the following extracts from the decision, in particular:

“[36] Fair Work Australia is charged with the responsibility of settling disputes in relation to matters arising under the Agreement. In doing so it is not constrained to giving effect to the precise meaning of the clause, as would be a court dealing with an application for, say, interpretation, or enforcement, of the Agreement. The union could have, had it been minded, brought proceedings in a court to enjoin Schweppes from breaching the Agreement. A court, in such a case, has no discretion when deciding what is the meaning of the clause.

[37] Whilst, ordinarily, one would give effect to the clear meaning of the agreement in settling a dispute arising under it, that need not necessarily be the case.

[38] In this case, regard to equity, good conscience and the merits of the matter, compel me to the conclusion that, whatever be the true meaning of clause 48.1, Schweppes, having had regard to the spirit and intent of the clause, ought be permitted to retain and operate the security cameras. In any event, as I have indicated, in my view, clause 48.1, properly interpreted, does not preclude Schweppes from installing additional security cameras.” 11

[28] It submits, in conclusion, that the interpretation Mr Guner seeks to place on the Agreement is an overly technical approach and at odds with the principles established in Berri.

Mr Peter Kavanagh

[29] Mr Peter Kavanagh is the General Counsel and Director, Member Services at Bus Association Victoria, which is the peak State body representing bus and coach operators in Victoria. He states that prior to the Award Modernisation process Part C of the Transport Workers (Passenger Vehicles) Award 2002 was the basis of a template enterprise agreement used by businesses in the bus industry, and this continues to be the case in regard to the existing template agreement. The terms and conditions set out in the first part of the existing Agreement simply represent some of the more important and regularly used clauses. However, clause 13 was never intended to change the existing arrangements that apply in the attached 2002 Award in regard to accident make-up pay.

[30] Mr Kavanagh also states that his inquiries indicate there has been no change to the accident make-up pay provisions in the template agreement since at least 2009.

[31] He also said that after reading the witness statement of Mr Lean he made enquiries of the 11 metropolitan operator members of the Association about their practices concerning payment of accident make-up pay. These indicated that three of those operators do make up the difference between the WorkCover payments received by an employee and the full amount of their pre-injury average weekly earnings, but eight do not. However, after reviewing the various emails received from each of the different operators he acknowledged in cross examination that three of those operators appear to include overtime earnings in the calculation of pre-injury average weekly earnings, while another two also include regular overtime earnings, although not earnings resulting from sporadic or occasional overtime.

Mr David Ratner

[32] Mr David Ratner is the General Manager of Cranbourne Transit. He confirmed that prior to Mr Guner sustaining his injury he was rostered to work on a Monday to Friday roster with a sixth day being offered as overtime. This additional day was a voluntary shift which most drivers took on to supplement their incomes.

[33] On 10 March 2017 he received a letter from solicitors representing Mr Guner which claimed an additional amount of accident make-up pay. He said he responded by indicating that no additional accident make-up pay was required to be paid, given the existing terms and conditions contained in the Agreement.

[34] Mr Ratner acknowledges that Mr Guner’s average take-home pay, including the regular overtime component, amounted to $1,588.00. However, it was not required to pay any additional accident make-up pay to him because the amount paid to him by the Insurer, being an amount of $1,270.00, exceeds the ordinary time rate of pay Mr Guner was earning. This ordinary time rate of pay, based on a working week of 38 hours, was $1,022.00.

[35] However, Mr Ratner also acknowledged in cross examination that during the ten day period immediately following Mr Guner’s injury Cranbourne Transit paid an amount equivalent to the full amount of his pre-injury average weekly earnings, including the regular overtime component. However, this was done on the basis of advice received from its Insurer.

Consideration

[36] The Commission has at least from one standpoint alone a relatively straightforward task in determining this matter. Is clause 13 in the main body of the Agreement to be read as a standalone provision by virtue of sub clause 6.1? Or is it to be read in conjunction with clause 24 in the attached 2002 Award, and sub clause 24.2.2, in particular. The Commission was referred in Mr Guner’s submissions to the recent Full Bench decision in Berri. It contains a detailed review of the principles to be applied in construing the terms of an enterprise agreement. In doing so it reviewed the principles set out in the earlier Full Bench decision in Golden Cockerel 12 and decided, in turn, that it was appropriate to make some amendments to those principles. The Full Bench’s conclusions are clearly relevant to the determination of this matter, and it is appropriate to have regard to that decision before proceeding to consider the circumstances involved in this matter.

[37] The Full Bench commenced its review of the principles to be applied in construing an enterprise agreement by noting, “The construction of an enterprise agreement, like that of a statute or a contract, begins with a consideration of the ordinary meaning of the relevant words. The disputed words must be construed in the context of the agreement as a whole.” 13 In this context it referred to the decision in Amcor Limited v CFMEU (2005) 222 CLR 241.

[38] It also noted that as a general principle all of the words contained in an enterprise agreement must, prima facie, be given some meaning and effect. It continued to note:

“Such an approach accords with the principles of statutory construction, and, as a general proposition, the principles developed in the general law in the context of the interpretation of statutes are applicable to the interpretation of enterprise agreements.” 14

It also noted that:

“There is a long line of authority in support of the proposition that a ‘narrow or pedantic’ approach to the interpretation of industrial instruments (such as enterprise agreements) is to be avoided, and that ‘fractured and illogical prose may be met by a generous and liberal approach to construction.” 15

It continued to note,

“A consequence of such an approach may be that some principles of statutory construction have less force in the context of construing an enterprise agreement.” 16

In this context it referred to the decision in Shop, Distributive and Allied Employees’ Association v Woolworths Limited, 17 which observed that the processes of bargaining and agreement making can mean that consistency of wording is often absent, and the same words can be used in different provisions with different meanings.

[39] The Full Bench finally concluded that the Agreement before it was ambiguous in relation to the wording involved. It continued to indicate that having identified ambiguity it was permissible to consider the evidence of surrounding circumstances as an aid to the task of interpreting the Agreement. However, it continued to note, “The admissibility of evidence of the surrounding circumstances is limited to evidence tending to establish objective background facts which were known to both parties and the subject matter of the contract. Evidence of such objective factors 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. As Mason J observed in Codelfa:

‘… when the issue is which of two or more possible meanings is to be given to a contractual provision we look, not to the actual intentions, aspirations or expectations of the parties before or at the time of contract, except insofar as they are expressed in the contract, but to the objective framework of facts within which the contract came into existence, and to the parties’ presumed intention in this setting.” 18

[40] It continued to refer to the matters identified in Golden Cockerel as evidence of relevance to the objective framework of facts including:

“(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.” 19

[41] It continued to note, “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.” 20 In this context it referred to the often cited decision in Kucks v CSR Limited.21

[42] The Full Bench also made reference to the different structure of agreement making that now exists under the current legislation noting that the parties to agreements are no longer simply an employer and an employee organisation. An agreement is instead now “made” when the majority of employees to be covered have been asked to approve the agreement and the majority of those vote in favour. This accordingly makes it more difficult to distil a common understanding among all of the employees that are covered by a particular agreement at the time is made. It follows that:

“The diversity of interests involved in the negotiation and making of enterprise agreements warrants the adoption of a cautious approach to the admission and reliance upon evidence of positions advanced during the negotiation process.” 22

[43] It also noted that, “The admissibility of the post-contractual conduct as an aid to the construction of a contract is a somewhat vexed issue, in respect of which no clear line of authority has emerged.” 23 It concluded in response at [106]:

“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, consistent with the view expressed by Santow J in Spunwill, the post-contractual conduct must be such as to found a common understanding – a settled interpretation accepted by the parties.” 24

[44] The Full Bench finally indicated in conclusion at [111]:

“We have given consideration to the resolution of the ambiguity in the 2014 Agreement, having regard to the evidence before us. We have not been persuaded by the arguments advanced by either the AMWU or Berri. The admissible extrinsic evidence of the surrounding circumstances is of limited assistance. There is a paucity of evidence regarding the negotiation of the 2014 Agreement and what, if anything, the employees covered by the agreement were told about the laundry allowance. In particular, there is no evidence of the explanation provided to the relevant employees, (pursuant to s.180(5)), of the terms of the 2014 Agreement and the effect of those terms.” 25

[45] As indicated, it also decided to modify the principles set out in Golden Cockerel as a consequence of its observations in Berri. It accordingly concluded:

“[114] The principles relevant to the task of construing a single enterprise agreement may be summarised as 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 and 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.” 26

[46] I have sought to apply the observations of the Full Bench in Berri, and its conclusions about the principles to be applied in construing an enterprise agreement, to the determination of this matter. I am also satisfied that these principles are to be applied in preference to the approach adopted by Kaufmann SDP in Schweppes Australia.

[47] It is noted at the outset that the Agreement has an unusual but not unique structure in that it, firstly, contains a series of terms and conditions in 19 separate clauses, including clause 13 dealing with “Accident Pay Make-Up.” It then contains an attached Schedule A, which purports to set out the terms and conditions contained in the former Transport Workers (Passenger Vehicles) Award 2002. Clause 6.1 in the main body of the Agreement makes clear the terms and conditions contained in the attached 2002 Award, as “attached in full in Schedule A,” 27 are intended to be incorporated into the Agreement except:

“(a) to the extent that they conflict with the terms and conditions contained in the main body of this Agreement;” 28

[48] Sub clause 6.2 continues to indicate, in somewhat convoluted terms, that any dispute arising about the interaction between the attached 2002 Award, which is described as “the Parent Award,” 29 and the main body of the Agreement, are to be dealt with in accordance with “the dispute resolution procedure contained at clause 12 of the main body of this Agreement.”30

[49] Therefore, while the terms and conditions contained in the attached 2002 Award are intended to be incorporated into the main body of the Agreement, they are not incorporated to the extent that they conflict with those terms and conditions. The reason why the Agreement is structured in this way is not necessarily germane to the determination of the matter, however, Cranbourne Transit indicated it is because of a desire to maintain the terms and conditions in the 2002 Award in the face of the Award Modernisation process which brought the operation of that Award to an end.

[50] Secondly, the wording in clause 13 of the Agreement is different in three particular respects from the wording in clause 24 of the attached 2002 Award. Firstly, it does not contain the definition of “Accident make-up payment” contained in sub clause 24.2.2. It also makes specific reference to “the Accident Compensation Act 1985 as amended from time to time” in sub clause 13.2(a), whereas the comparable wording in clause 24 simply refers to “the appropriate compensation legislation as amended from time to time.” 31 Thirdly, it states in sub clause 13.2(b) that “Accident make-up payment shall not apply in respect of any injury during the first ten normal working days of incapacity as the employer is responsible to pay 100% Workers Compensation as per the Act.”32 The comparable wording in clause 24 simply states, “Accident make–up payment shall not apply in respect of any injury during the first ten normal working days of incapacity.”33

[51] The first step in reviewing the relevant provisions in the Agreement in accordance with the principles established in Berri requires the Commission to begin by considering the ordinary meaning of the relevant words, and whether they can be said to have a plain meaning. This is to be assessed objectively by reference to what a reasonable person would understand by the language used, and by the arrangement in the Agreement of the relevant words. It is also clear that the task of interpreting the Agreement does not involve rewriting the words to achieve what one party or the other might consider to be a fair and just outcome. The task instead is one of interpreting the Agreement produced by the parties.

[52] I am satisfied in response that the words in clause 13 can be said to have a plain meaning. I am also satisfied that the location of the clause in the main body of the Agreement, together with the provisions contained in sub clause 6.1, mean that clause 13 is intended to apply in place of clause 24 in the attached 2002 Award.

[53] Clause 13 indicates at the outset that it is intended to apply to all employees covered by the Agreement (other than casuals) in circumstances where incapacity arises from a work related injury sustained after the date of operation of the Agreement. It then continues to set out the circumstances in which any such employees shall be entitled to accident make-up payments. It indicates, firstly, that the employer is required to make such payments where the employee receives an injury for which weekly payments of compensation are payable under to the provisions of the Accident Compensation Act 1985 as amended from time to time. It then makes clear that make-up payments do not apply in respect of the first ten normal working days of incapacity following injury as the legislation already requires that the employer pay the full amount during this period. It finally makes clear that the obligation only continues until such time as the incapacity ceases, or until the expiration of 39 weeks from the date of injury, whichever occurs first.

[54] Clause 13 obviously does not contain the definition of accident make-up pay contained in clause 24.2.2 of the attached 2002 Award. However, this does not mean that the obligation in regard to the payment of accident make-up pay is not able to be understood or discerned. The clause instead makes clear that the obligation created exists in conjunction with the provisions contained in the Accident Compensation Act 1985, as amended from time to time. As Mr Guner indicated in his submissions, the current State based legislation, being the Workplace Injury Rehabilitation and Compensation Act 2013, contains a definition of pre-injury average weekly earnings. It follows that the make-up pay obligation imposed on the employer is the difference between the amount of compensation provided by the Insurer and the employee’s pre-injury average weekly earnings as defined by the relevant legislation. In this context it can be noted that the referencing of State based legislation in an enterprise agreement in order to specify certain obligations is not unusual and applies commonly, for example, by reference to State-based long service leave legislation.

[55] I am accordingly satisfied that clause 13 does have a plain meaning based on the ordinary meaning of the relevant words, including the references to the specific legislative provisions.

[56] I am also satisfied that the placement and arrangement of the clause in the first part of the main body of the Agreement is significant in terms of discerning what a reasonable person would understand to be the intention of the parties. No evidence was provided during the course of the proceedings to indicate how clause 13 in its current form came to be included in the Agreement. However, I am satisfied that it is reasonable to assume, on an objective basis, that by its inclusion in the main body of the Agreement clause 13 was intended to now replace the wording contained in clause 24 of the attached 2002 Award. It is difficult to think of any other reason why clause 13 would be included in the main body of the Agreement if this were not the case.

[57] It follows from this conclusion that the definition contained in sub clause 24.2.2 of the attached 2002 Award no longer continues to apply by virtue of sub clause 6.1.

[58] Having come to the conclusion that the relevant words in the Agreement have a plain meaning there is no requirement to consider the evidence relied on by the parties in regard to the surrounding circumstances, although it is also noted that this evidence appeared to do little to assist in establishing facts known to both parties, and appeared to be more about a reflection of various subjective intentions.

Conclusion

[59] I am satisfied, in conclusion, that the words in clause 13 of the Agreement have a plain meaning, and that the Agreement should be interpreted and applied on the basis of that plain meaning. It follows that the obligation imposed on Cranbourne Transit to provide accident make-up pay to Mr Guner is to be determined in accordance with clause 13. The provisions contained in clause 24 of the attached 2002 Award, and those contained in sub clause 24.2.2 in particular, are accordingly in conflict with clause 13 and are therefore not incorporated into the main body of the Agreement as a consequence of sub clause 6.1.

COMMISSIONER

Appearances:

G Jardine of Counsel for the Applicant.

I MacDonald of the Australian Public Transport Industrial Association for the Respondent.

Hearing details:

2017.

Melbourne:

November 9.

 1   AE409177.

 2   AP818060.

 3   Cranbourne Transit Pty Ltd Enterprise Agreement 2014 at cl 13.

 4   Ibid at cl 6.

 5   Transport Workers (Passenger Vehicles) Award 2002 at cl 24.

 6   [2017] FWCFB 3005.

 7 Witness statement of Robert Lean, dated 18 July 2017, at [5].

 8 Ibid at [6].

 9   Transport Workers (Passenger Vehicles) Award 2002 at cl 24.2.2.

 10   [2012] FWA 46.

 11   United Voice v Schweppes Australia Pty Ltd[2012] FWA 46 at [36]-[38].

 12   The Australasian Meat Industry Employees Union v Golden Cockrel Pty Ltd [2014] FWCFB 7447.

 13   “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) v Berri Pty Limited [2017] FWCFB 3005 at [41].

 14 Ibid at [44].

 15 Ibid at [46].

 16   Ibid.

 17 [2006] FCA 616.

 18   “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) v Berri Pty Limited [2017] FWCFB 3005 at [62].

 19 Ibid at [63].

 20 Ibid at [65].

 21 (1996) 66 IR 182.

 22   “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) v Berri Pty Limited [2017] FWCFB 3005 at [88].

 23 Ibid at [101].

 24 Ibid at [106].

 25 Ibid at [111].

 26 Ibid at [114].

 27   Cranbourne Transit Pty Ltd Enterprise Agreement 2014 at 6.1.

 28   Ibid at 6.1(a).

 29   Ibid at 6.2.

 30   Ibid.

 31   Cranbourne Transit Pty Ltd Enterprise Agreement 2014 at 13.2(a).

 32   Ibid at 13.2(b)

 33   Transport Workers (Passenger Vehicles) Award 2002 at cl 24.2.3.

Printed by authority of the Commonwealth Government Printer

<PR599580>