Paul Alan and Chau, Alex v Linfox Australia Pty Ltd T/A Linfox Australia - [2019] FWC 7345

[2019] FWC 7345[Note: An appeal pursuant to s.604 (C2019/7825) was lodged against this decision.]

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.739 - Application to deal with a dispute

Paul Alan and Chau, Alex and others

Linfox Australia Pty Ltd T/A Linfox Australia

(C2018/5552)

Commissioner Lee

MELBOURNE, 2 december 2019

Alleged dispute about matters arising under the enterprise agreement – whether the terms of the Agreement allow the Respondent to require the Applicants to pick as part of their ordinary duties – whether there is an industrial custom or practice – if there is an industrial custom or practice is the Respondent prevented from discontinuing it.

Introduction and background

On 4 October 2018, 30 employees of Linfox Australia Pty Ltd (the Applicants) made an application under s.739 of the Fair Work Act 2009 (the Act) notifying a dispute to the Fair Work Commission (the Commission). The Respondent to the application is Linfox Australia Pty Ltd T/A Linfox Australia (the Respondent). The dispute is about whether the Respondent can direct the Applicants to perform picking work as part of their ordinary duties. The Applicants all work at the Truganina Regional Distribution Centre (RDC). With the exception of Catherine Taylor, all of the Applicants were previously employed by Westgate Logistics Pty Ltd (Westgate) prior to their employment transferring to the Respondent.[1]

It was agreed that the 30 applications would be dealt with and determined as part of the one proceeding.

Since September 2007, there have been 201 former Westgate employee terminations. As at 22 May 2018, the remaining 158 former Westgate employees work alongside 160 employees who were not previously engaged by Westgate, totalling approximately 318 employees of the Respondent at the RDC.[2]

The relevant Agreement is the Linfox and Transport Workers Union Road Transport and Distribution Centres Agreement 2018 (the 2018 Agreement). The dispute resolution procedure relied upon is located at clause 33 of the Agreement. According to the Form F10 – Application for the Commission to deal with a dispute in accordance with a dispute settlement procedure (Form F10), the dispute relates to clause 5 of the 2018 Agreement, ‘Custom and Practice.’

A dispute (C2018/1611)) was originally lodged on 26 March 2018 in reference to the then applicable enterprise agreement. That dispute was set down for arbitration and was part heard. When it became known to the Applicants that the 2018 Agreement had been approved by the Commission, the Applicants discontinued that application as it was made in relation to an Agreement that no longer applied to them. A new application was made in virtually identical terms and allocated to me. The parties agreed that certain evidence adduced during the earlier proceedings could be relied on in the determination of this matter.[3]

Ms Jardine of counsel was given permission to appear pursuant to s.596 (2)(a) of the Act. While it was apparent there was benefit in granting permission to appear to Ms Jardine in circumstances where there were 30 Applicants and a significant amount of evidence, Ms Jardine was a rather erratic representative. For example, when warned by me about not leading a witness on re-examination, Ms Jardine claimed she was entitled to do so.[4] Also, the cross-examination of Mr Milburn was disorderly and difficult to follow. Mr Jones, General Manager Workplace Relations, represented the Respondent.

On 22 March 2018, the Respondent directed the Applicants to attend medical examinations in order to assess their range of motion to perform picking work. According to the Applicants, this direction is part of the Respondent’s plan to implement “pick plus one” for all employees at RDC, including the Applicants. The Applicants contend that the Respondent cannot direct them to perform picking work as part of their ordinary duties as there is an industrial custom and practice that they do not perform this task as part of their ordinary duties. Relevantly, clause 5 of the 2018 Agreement provides as follows:

“5. CUSTOM AND PRACTICE
5.1 This Agreement is not intended to, nor shall it, alter a custom and practice applicable to the parties.

5.2 It is the intention of the parties to this Agreement to, during the Term, attempt to reduce to writing any custom and practice applicable to Linfox and the Employees.
5.3 The parties will review and where agreed create a local agreement arising from the custom and practice in accordance with Clause 34.
5.4 Any dispute about the operation of this clause is to be dealt with in accordance with the disputes procedure in this Agreement.”

Having regard to clause 5 of the 2018 Agreement, the Applicants assert that there is an industrial custom and practice, to the effect that the Applicants do not perform picking work as part of their ordinary duties. Therefore, the Applicants cannot be directed to perform those duties as this would be inconsistent with clause 5 of the 2018 Agreement.

It is agreed the question or questions to be answered to resolve this dispute are as follows:

“Is there an “industrial” rather than a “contractual” custom and practice for the purposes of clause 5 of the Agreement, to the effect that the 31 Applicants’ do not perform picking work as part of their ordinary duties?
· If the answer to the question is “no” the dispute is resolved.
· If the answer to the question is “yes”, is Linfox Australia Pty Ltd prevented from discontinuing that custom and practice?”[5]

The History of the Dispute

As mentioned earlier, this dispute has been brought forward on behalf of 30 individual Applicants. The dispute was the subject of a conciliation conference before me. As the dispute was unable to be resolved by conciliation, the matter was listed for arbitration. The central focus of this dispute, that is, whether it is a custom and practice that the Applicants do not perform picking work as part of their ordinary duties, has a long history and has been the subject of earlier proceedings in the Fair Work Commission and Fair Work Australia as it was previously known, though the number of employees involved in the earlier proceedings has differed.

Three decisions have been made by the Fair Work Commission that have dealt with similar disputes to this dispute. These decisions are:

· National Union of Workers v Linfox Australia Pty Ltd,[6] (the first decision) an arbitration of a s. 739 application;
· Alan Paull & Ors v Linfox Australia Pty Ltd T/A Linfox,[7] (the second decision) an arbitration of a s.739 application; and
· Mr Alan Paull and Ors v Linfox Australia Pty Ltd, [8](the third decision) an appeal decision of the second decision.

In the first decision, Commissioner Gregory set out the nature of the dispute to be resolved as follows:

“Linfox wants all employees in the Distribution Centre to be able to perform what it describes as “the core picking function,” when required. However, eight employees at the Distribution Centre, who were previously employed by Westgate Logistics, claim they are not required to perform this work. Five of the employees submit the contract of employment they entered into when employed by Westgate continues to have application, and only requires them to perform certain functions, which do not include picking work. The remaining three employees acknowledge their roles and responsibilities have changed since they were employed by Westgate, but claim they have never been asked to perform picking work. They accordingly submit Clause 5 “Custom and Practice” in the 2014 Agreement means they are also not required to perform picking duties.”[9]

The dispute that lead to the first decision was notified by the National Union of Workers (NUW). The agreement that applied to the employees at that time was the Linfox and Transport Workers’ Union Road Transport and Distribution Centres Agreement 2014[10] (the 2014 Agreement). Eight employees were the subject of that dispute. The application for the dispute was made on 6 November 2015. In respect of five of the eight employees, the NUW submitted that it would be unlawful to direct those employees to perform picking duties because of the terms of their employment contracts (Westgate contracts) which stated that each was employed in specific positions, for example “fork lift driver” or “fork lift operator.”[11]

In respect of the remaining three employees (who had been reclassified since being employed by the Respondent), the NUW submitted that there has been a custom and practice in place, whereby those employees have not been required to perform the picking function, which precluded the Respondent from directing those three employees from performing picking work. In that context, the NUW relied on clause 5, ‘Custom and Practice,’ of the 2014 Agreement that at that time applied to the employees. I note that clause 5 of the 2014 Agreement is identical to the terms at clause 5 of the 2018 Agreement.[12]

The Commissioner determined in that matter, in respect of the five employees who relied on their Westgate contracts, that the requirement to do picking work was consistent with the terms of their contracts and consequently did not prevent the Respondent from requiring the employees to perform picking work.[13]

In regards to the “custom and practice” submission advanced in respect of the other three employees, the Commissioner determined:

“[49] However, based on the evidence in the proceedings it is difficult to conclude that each of the employees intended to mislead the Commission when providing evidence on oath. On balance I am satisfied, in conclusion, that the employees were generally only required to perform the roles and responsibilities associated with their “position” during ordinary time hours, and were not required to perform the picking task.

[50] However, it is also acknowledged that the evidence indicates the employees have performed picking work, at least as volunteers during overtime shifts. It is also acknowledged that in the position of forklift operator there is an amount of manual handling work involved, and the employees are required on numerous occasions each day to carry out this work.”

The Commissioner further determined that, having regard to the decision of the Full Bench in Transport Workers’ Union of Australia v Linfox Australia Pty Ltd (TWU v Linfox)[14] which dealt with the interpretation of clause 5 of the 2014 Agreement, albeit in respect of a different dispute, that “…it is not appropriate to deal further with the present application. I am satisfied instead that if the NUW wants to progress the matter it needs to do so, firstly, by establishing that a custom and practice exists that has not been reduced to writing, having regard to the principles contained in Con-Stan.”[15]

The Commissioner then concluded:

“[75] I am satisfied, firstly, that I am bound to follow the approach adopted by the Full Bench in regard to the application of Clause 5 in the 2014 Agreement, given it was dealing with matters closely aligned to those in the present application. Secondly, I am not satisfied the NUW has sought to deal with its claim of “custom and practice” on the basis of the principles established by the decision in Con-Stan, as the Full Bench decision requires. Thirdly, I am not satisfied, for the reasons indicated, that the Westgate contracts preclude Linfox from implementing the changes it now proposes. The application is accordingly dismissed.”[16]

The first decision was not appealed.

The second decision was the outcome of an arbitration of 34 separate applications made pursuant to s.739 of the Act. These applications were also allocated to Commissioner Gregory. The application the subject of the second decision was made on 29 September 2016. The Commissioner noted that the applications were in identical terms and all but one of the Applicants were previously employed by Westgate prior to it being acquired by the Respondent in 2007. The disputes were joined and dealt with together. The disputes also related to clause 5 of the 2014 Agreement. The Commissioner stated:

“[6] Linfox now seeks to have all employees in the Distribution Centre, including the thirty-four Applicants, participate in its so-called “Pick Plus One” program, which requires all employees, when directed, to carry out the task of order picking during normal working hours.
[7] It is understood this could require the Applicants to carry out order picking for up to three days per week in circumstances where they are now, in the main, performing certain specific roles only, such as forklift driver, clerk, inventory clerk, loader or team leader.
[8] The Applicants accordingly maintain that a custom and practice has been established over an extended period whereby they are only required to perform certain specific roles. Clause 5 of the 2014 Agreement, in turn, provides that it is not intended to alter an existing custom and practice that applies to the parties.
[9] Therefore, the Commission is, firstly, required to determine whether a “custom and practice” exists, as in Clause 5 of the 2014 Agreement, in regard to the thirty-four Applicants. If the Commission finds such a custom and practice does exist then it is also required to determine what Clause 5 intends and requires. In particular, does it preclude Linfox from being able to direct the Applicants to carry out the task of order picking?”[17]

The Commissioner approached the task of determining the matter as to whether a custom and practice exists in regard to the duties the Applicants performed based on the application of the propositions established by the decision of the High Court in Con-Stan.[18] The Commissioner explicitly noted that the parties acknowledged the matter would be determined with reference to the propositions in Con-stan.[19]

In applying the principles in Con-stan, the Commissioner made the following findings of fact:

“[68] I am satisfied, firstly, that the evidence does establish that each of the thirty-four Applicants has predominantly been involved in performing a particular task or function, such as inventory clerk or forklift driver, during most of the time they have been employed, both by Westgate Logistics and then Linfox. This is despite the terms of their employment contracts, which make clear they can be directed to perform other tasks, as required. While the evidence of Mr Milburn, in particular, indicates that many of the Applicants have performed other tasks from time to time including order picking. I am satisfied that the main expectation of both the Applicants and Linfox was they would perform a particular task, and they have done so over an extended period of time.

[69] The evidence also establishes that the overwhelming majority of the remaining former Westgate Logistics employees, who continue to be employed at the Distribution Centre, have been prepared or have agreed to perform a variety of different tasks. This is including order picking when directed. Therefore, if a custom and practice can be said to exist it is clearly not one that applies to the entire workforce at the Distribution Centre or, indeed, to all of those employees who were previously employed by Westgate Logistics. It is instead limited to only the thirty-four Applicants.

[70] The evidence also establishes that most, if not all, of the Applicants have done some order picking at some time. Some sought to downplay the extent to which this has occurred, and some denied they had done any order picking at all.

[71] The evidence of Mr Milburn, on the other hand, was different. However, the records produced by Linfox appear to confirm that the overwhelming majority of the Applicants have carried out order picking at some time. In some cases this has occurred primarily when additional overtime work has been performed, or when imposed as a “punishment” for some transgression in the workplace. In other cases it was carried out in response to particular work demands in the Distribution Centre. However, while accepting that the evidence does establish that most, if not all, of the Applicants have carried out order picking at some time, it is again acknowledged that the evidence makes clear that they have primarily performed a single function during most of their employment.

[72] The evidence also establishes that the Applicants have received some training in the task of order picking, although Mr Milburn acknowledges that where this has occurred as part of the regular chain of responsibility training it has been primarily theoretical in nature, and involving classroom instruction rather than hands-on training in the workplace.

[73] However, in terms of the first of the propositions in Con Stan I am not satisfied, in conclusion, that the evidence establishes that a custom and practice exists in the Distribution Centre whereby all, or even the majority of employees are only performing a single task or role. This instead appears to be a situation that only applies to the thirty-four Applicants, who represent a relatively small minority of the total number of employees working in the Distribution Centre.

The Commissioner also determined that:

“[75] The relatively small number of employees involved means that it is not possible to conclude that the evidence establishes that the custom and practice sought to be identified is so well-known and understood that all of the employees at the Distribution Centre can be said to have that term implied into their employment contracts. The evidence instead indicates that the overwhelming majority of employees, including a majority of those previously employed by Westgate Logistics, have accepted the requirement to carry out a range of tasks, as directed.”[20]

The Commissioner also determined that:

“[79] The Applicants’ employment contracts therefore contain an express term that indicates that their duties and responsibilities may change from time to time, and they may be required to work in an alternative warehousing and distribution position. They now seek to have a term implied into their employment contracts, based on an alleged custom and practice, which would be contrary to these express terms.”[21]

Consistent with these findings, the Commissioner concluded:

“I have had regard to the evidence and the submissions that have been provided by the parties that I consider relevant to the determination of the matter in the light of the propositions identified in Con-Stan. I am not satisfied, in conclusion, that in all the circumstances the existence of a custom and practice as claimed by the Applicants can be found to exist, given the propositions in Con-Stan. The conclusions set out above in regard to the second and third of those propositions are of particular relevance in terms of this decision. Having concluded that a “custom and practice” does not exist in terms of clause 5 of the 2014 Agreement there is no requirement to give any further consideration to the requirements of that clause. The applications are accordingly dismissed.”[22]

The Applicants appealed the second decision. The Full Bench observed that the notice of appeal contained “a series of questions” and did not contain appeal grounds or allege error on the part of the Commissioner. Nevertheless, the Full Bench distilled two grounds of appeal from the written submissions of the Appellants. First, that the Commissioner had erred in applying the second to fourth principles in Con-Stan to the interpretation of clause 5 of the 2014 Agreement. Secondly, (or alternatively) the Commissioner erred in the manner in which he applied the Con-Stan principles.

In determining the Appeal (the third decision), the Full Bench also referred to the decision in TWU v Linfox [23] and its reference to the Con-Stan decision and the four propositions it set out to be considered, when determining whether a custom and practice exists.

The Full Bench in the TWU v Linfox decision in referring to the Con-Stan decision, stated as follows:

“This approach has been taken in various other decisions of this Commission and is well-understood as the correct approach for the Full Bench to rely on in determining whether the procedures provided for in the APMs are a “custom and practice” in the relevant industrial context.”[24]

The Full Bench in the third decision made the following observation in relation to this statement made by the Full Bench in TWU v Linfox:

“In our view, the Full Bench did not purport to lay down a general rule about how ‘custom and practice’ is to be ascertained, either for the purposes of clause 5 of the 2014 Agreement, or more broadly where ‘custom and practice’ is referred to in enterprise agreements. It concluded rather that the ‘approach’ in Con-Stan was the ‘correct approach for the Full Bench to rely on in determining whether the procedures provided for in the APMs are a ‘custom and practice’ in the relevant industrial context’. The conclusion was one made with respect to the particular circumstances of that case. If we are wrong about this, and the Full Bench was positing a more general proposition, it should be viewed with some caution.”[25]

The Full Bench in the third decision went on to state the following:

“[20] The proper approach of the Commission to the determination of a dispute referred to it under a disputes procedure depends on the terms of that procedure, and the nature of the dispute at hand. The question of whether ‘custom and practice’ exists for the purposes of clause 5.1 of the 2014 Agreement does not necessarily have to be determined by reference to the principles in Con-Stan. Recourse to Con-Stan would only be required if the relevant dispute is about whether custom and practice has led to implied terms in employees’ contracts. This was the case in the present matter. The dispute was not about whether there was an ‘industrial’ custom and practice unconnected with any contractual controversy. Rather, the dispute was whether there was custom and practice as described in Con-Stan.
[21] If the dispute had concerned ‘industrial’ custom and practice, it would not in our view have been necessary to apply the principles in Con-Stan; nor would it have been appropriate to apply, at least in an unmodified way, such contractual principles to a statutory instrument which is not (or would be unlikely to be) a contract at common law. We return further below to the use that might be made of Con-Stan in such cases.
[22] Given Commissioner Gregory’s earlier decision that he considered the Full Bench decision to be binding on him, the appellants may have believed that they were constrained to formulate the dispute in the manner they did, focusing on the application of the principles in Con-Stan and whether custom and practice had led to an implied term in employees’ contracts of employment. They were not so constrained. It was however open for the appellants to bring such a dispute to the Commission under clause 33 of the Agreement. The Commissioner answered the question that was put to him. He applied the principles in Con-Stan and determined that he was not satisfied that there was a custom and practice in relation to order picking that would justify the implication of a term into employees’ contracts.
[23] In the circumstances of the present case, the Commissioner did not err in applying the principles of Con-Stan. The appellants’ first ground of appeal is rejected.”[26]

In respect to the second or alternative ground of appeal, the Full Bench determined that there was one error of the Commissioner in applying the principles in Con-Stan, however that the error was of no consequence. The Full Bench determined that as the second ground of appeal fails, the appeal must be dismissed.

The Full Bench then went on to make observations at some length as to whether a different dispute in relation to “industrial” custom and practice could be brought to the Commission.[27] These observations are clearly relevant to the consideration in this matter and I will canvass them in detail later in the decision.

It is against this arbitral background that the Applicants have now brought a dispute related to “industrial” custom and practice, as was contemplated by the Full Bench in the third decision.

Jurisdiction to arbitrate the dispute

This is an application made pursuant to s.739 of the Act. Relevantly, ss.738 and 739 of the Act provide as follows:

“738 Application of this Division

This Division applies if:

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

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

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

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

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) effectas 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.”

The dispute settlement clause in the Agreement is clause 33 and is in the following terms:

“33. SETTLEMENT OF DISPUTES PROCEDURE
33.1 Any dispute or grievance that arises at the workplace between an Employee and Linfox and/or Linfox and the TWU about the Agreement or the employment relationship (including, for the avoidance of doubt, in relation to the NES) shall be dealt with in the following manner:
(a) The matter must first be discussed by the aggrieved Employee(s) directly with his or her immediate supervisor. The Employee will be advised that they may seek TWU representation, or another representative of their choice, if they choose to do so;
(b) If the matter remains in dispute, it must next be discussed with the supervisor’s immediate superior or another representative of Linfox appointed for the purpose of this procedure. The TWU delegate for the worksite has the right to attend and participate in this discussion as the representative of an Employee provided that the TWU delegate is the representative of the Employee’s choice;
(c) If the matter remains in dispute, it must next be discussed with the relevant manager of Linfox. The relevant TWU state secretary (or his/her nominee) has the right to attend at and participate in this discussion as the representative of an Employee provided that the relevant TWU state secretary is the representative of the Employee’s choice;
(d) If the matter remains in dispute, it must next be submitted to the FWC for conciliation. For this purpose, it is agreed that the action FWC may take includes:
(i)arranging conferences of the parties or their representatives at which the FWC is present; and
(ii)arranging for the parties or their representatives to confer among themselves as conferences at which the FWC is not present;

(e) If the matter is not resolved in conciliation conducted by the FWC, the parties agree that the FWC may proceed to arbitrate the dispute and/or otherwise determine the rights and/or obligations of the parties to the dispute. In relation to such arbitration, the parties agree that:
(i)FWC may give all such directions and do all such things as are necessary for the just resolution of the dispute, including but not limited to those things set out in section 595 of the Act;
(ii)before making a determination FWC will give the parties an opportunity to be heard formally on the matter(s) in dispute;
(iii)in making its determination FWC will only have regard to the materials, including witness evidence, and submissions put before it at the hearing and will disregard any admissions, concessions, offers or claims made in conciliation;

(f) The decision of FWC will be binding on the parties subject to the following agreed matters:
(i)There shall be a right of appeal to a Full Bench of FWC against the decision, which must be exercised within 21 days of the decision being issued or within such further time as the Full Bench may allow;
(ii)The appeal will be conducted in accordance with the legal principles applying to an appeal;
(iii)The Full Bench shall have the power to stay the decision pending the hearing and determination of the appeal.

33.2 The decision of the FWC (subject to an appeal to a Full Bench) and the Full Bench in any appeal will be binding upon the parties, subject to review by the Federal Court of Australia, in accordance with the Judiciary Act 1903 (Cth) or any other applicable law of the Commonwealth.
33.3 Any decision of the Federal Court of Australia pursuant to clause 33.2 will be binding on the parties subject to any right of appeal.
33.4 Until the matter is resolved by agreement, conciliation or arbitration, the Status Quo shall prevail. No party is to be prejudiced as to the final settlement by the continuance of work in accordance with this procedure.
33.5 The parties must co-operate to ensure that these procedures are carried out
expeditiously. The parties undertake to resolve any disputes in a timely manner in accordance with the disputes procedure.

33.6 To avoid doubt, this dispute resolution procedure shall not be used to resolve unfair dismissals or adverse action claims.”

It is apparent, that the required steps of the dispute settlement procedure have been complied with and the dispute relates to a matter arising under the 2018 Agreement. Neither party has contended otherwise, nor has either party contended that there is any other jurisdictional barrier to the Commission arbitrating the matter. I am satisfied that the requisite jurisdiction exists for the Commission to arbitrate the dispute and, consistent with the dispute settlement procedure provision, make a determination that is binding on the parties.

The Evidence

Do the Applicants perform picking work as part of their ordinary duties?

The Respondent points to the following evidence that the Applicants have in fact performed picking work:

“Sections 7 & 8 of A6 the ‘Agreed facts’ confirms the ‘Roster History’ documents submitted in this proceeding to be true and accurate. One of the Applicants Tho T Au performed picking work on 60 separate days.

Under cross examination, Arthur Bregiannis confirmed that the applicants who are listed in the ‘excepted’ roster histories category in section 7 of A6, did perform picking work during their ordinary hours of work.[28]

Exhibits BM9-1 to 12 which were agreed that the Commission could rely upon;[29] also confirm that some of the applicants performed picking work during their ordinary hours of work during their employment with Westgate and Linfox. BM9-2 has Christopher Speed performing picking work in 2007 & 2016 & BM9-3 has Esher Sefou performing picking work in 2007 & 2015.

Under cross examination Frank Pisano confirmed that the applicants who are referred to in BM9-1 to 12 did perform picking work during their ordinary hours of work.[30]

Under cross examination Mel Bailey confirmed that the applicants who are referred to in Exhibit MB5 did perform picking work during their ordinary hours of work.[31]

It is also an agreed fact arising from section 5 of exhibit A6 that each of the applicants have undertaken picking training; the same training undertaken by all other employees at the site.”[32]

Notwithstanding this evidence, the Applicants claim that the evidence does not demonstrate that they have performed picking work as part of their ordinary duties. They concede that some of the afternoon shift employees “… on an odd occasion in 2007 were doing shorts chasing using a fork lift, which is not picking.”[33] However, the evidence indicates that shorts chasing is picking work, the only difference is that one uses either a forklift or a tugger to transport to and from the pick slot.[34]

Mr Mel Bailey, one of the Applicants in these proceedings, gave evidence that he had obtained written comments from each of the Applicants about any picking that the time sheet records showed they had performed.[35] These comments included claims to the effect that the Applicants only did picking work as a form of punishment, on return from leave for a work related injury or similar unique circumstances. However, Mr Brendan Milburn, Project Manager for the Respondent expressly denied that the Respondent allocates picking work as a form of punishment.[36]

The Applicants also submit that Mr Frank Pisano’s evidence demonstrated that in 2006 some employees performed other duties on a “volunteer basis” and therefore no conclusion can be drawn that any of these employees were performing picking as part of their ordinary duties.[37] The Applicants claim there is no evidence that they were required to perform picking work as part of their ordinary duties following a conversation between Mr Batzakis, Inventory Manager for the Respondent and two Transport Workers’ Union of Australia (TWU) representatives in 2008. Further, that there is no evidence that the Applicants were required to perform picking work as part of their ordinary duties since a dispute in 2012 was resolved on the basis that former Westgate employees were not required to perform picking duties as part of their ordinary duties. I will deal with these alleged agreements that the Applicants not pick as part of their ordinary duties in the next part of the decision.

The evidence clearly demonstrates that many of the Applicants have been involved in picking during their ordinary hours of duty, at least to some extent. I am not satisfied as to the evidence that they did so as a form of punishment or that they “volunteered” to do so. The evidence led to that effect was rather self-serving and not credible. However, it makes little difference to the outcome. The fact remains that many of the Applicants have been involved in some picking work as part of their ordinary duties. It is not in contest that they perform picking work when they are engaged to perform overtime. It is also apparent that the Applicants have been trained in how to perform the task.
However, it is also apparent from the evidence that the Applicants have not undertaken a significant amount of picking work as part of their ordinary duties prior to the 2014 Agreement and the successor Agreement coming into effect. In that regard, my finding on the evidence is generally consistent with that of Commissioner Gregory in the second decision, where he found after considering the evidence before him that it did establish that most, if not all, of the Applicants have carried out order picking at some time, but that the evidence makes clear that they have primarily performed a single function during most of their employment.

The reason for this state of affairs becomes apparent when one examines the long history of disputation over this issue, and it is to that history that I will now turn.

The evidence as to whether there is an industrial agreement, arrangement or settlement

The Applicants largely rely on a variety of alleged conversations and other exchanges which are claimed to have occurred in a variety of locations and took place a number of times over a period of some years, as evidence of the alleged agreement between the parties that the Applicants are not required to perform picking work. Some of the Applicants gave evidence about conversations that pertained to their own circumstances, and some gave evidence about alleged agreements of a collective character. The Applicants’ evidence as to the alleged agreements that they not pick as a part of their ordinary duties was for the most part, rather scrambled and often difficult to follow. An assessment of the evidence follows.

Mr Frank Pisano, one of the Applicants in this proceeding, claims that Mr Arkell, the then President of HR for the Respondent on 4 September 2007 confirmed that none of the Applicants were required to perform picking work.[38] The “letter of offer” addressed to Mr Pisano states that he will “be employed by Linfox on and from the transfer date in your current role and on the same terms and conditions as you were entitled to with Westgate immediately before your transfer date.”[39] Mr Pisano gave evidence that he was also requested by Mr Batzakis to perform picking work and refused the request relying on the “letter of offer.”[40]

It is necessary at the outset to make some observations about Mr Pisano. He was an argumentative and frequently uncooperative and unresponsive witness. For example, at the commencement of cross examination, he claimed “not to have a clue” as to the number of employees at the warehouse despite having worked there for many years and having been a union delegate for a substantial amount of that time.[41] When asked if there was any written arrangements, or settlements that codify the practice of not picking during the ordinary hours of work, his reply was “No, There could be verbal agreements” (emphasis added).[42] Ultimately, Mr Pisano relied on a letter from Laurie D’Apice, Vice President of Industrial Relations and Human Resources dated 9 March 2011 as evidencing an agreement that the Applicants not perform picking work.

This letter was in the following terms:

“I write to you in response to your letter dated 3 March 2011. Specifically, in relation to point 3 of your previous correspondence whereby you are seeking a commitment of good faith from Linfox in respect of the incorporated terms provision.

I can confirm that in the drafting of the Agreement between Linfox and the Transport Workers Union – Linfox Road Transport & Distribution Centres National Enterprise Agreement 2011, Linfox has inadvertently missed incorporating a term from a previous enterprise agreement which was more beneficial than the common term in place in the new enterprise agreement, Linfox will honour this arrangement.

Notwithstanding the above, any provision that was expressly excluded as a part of the
negotiation, and agreed to by the parties shall remain excluded, will not form part of this arrangement.
I trust this letter gives the TWU the response and assurance you are seeking in relation to this matter.”[43]

However, Mr Pisano conceded that the letter from Mr D’Apice said nothing about the Applicants not being required to perform picking work as part of their ordinary duties.[44] This issue is considered again later in the decision.

Mr Pisano denies the claim of Mr Milburn to the effect that the Respondent (previously Westgate) have always maintained that employees will perform the tasks and duties at or below their relevant classification designated as directed.[45] Mr Pisano claims that “we” were never directed as to what tasks to perform. However, Mr Pisano’s evidence was really about his own experience where he claims he was not directed to perform picking duties.[46] Mr Pisano also agreed when taken to other evidence in the proceeding that:

· The Respondent asked Mr Bailey to perform picking duties in 2007-2008;[47]
· The Respondent manager Mr Batsakis tried to direct the Westgate forklift drivers to also undertake picking duties;[48]
· In 2008, (as per Mr Petersons statement) the Respondent tried to get the Applicants to pick, but they refused;[49]
· In 2010 Mr Tighe, the General Manager of the Respondent at the time, tried to change the situation to get Westgate employees to perform other duties during their ordinary time of work;[50]
· Mr Tighe tried to introduce pick plus one for all employees in 2011 including the Applicants in this proceeding;[51]
· Mr Tighe tried to get the Westgate employees to pick in 2011-12;[52]
· The Respondent attempted to get forklift drivers to perform other duties in January 2013;[53] and
· Ultimately, Mr Pisano agreed that the Respondent has been trying to get employees to perform picking duties and that they have refused. Mr Pisano also made clear that the refusal to do the work was based on their letters of offer or contracts.[54]

The cross examination of Mr Pisano plainly sets out the ongoing history of disputation in relation to this matter as to whether the Applicants can be required to to pick as part of their ordinary duties. Against this background, the vague claims of Mr Pisano that there “could” be a verbal agreement are not accepted.

Mr Mel Bailey, another of the Applicants’ witnesses made claims as to agreements that Respondent representatives allegedly made, that the Applicants would not be required to pick as part of their ordinary duties. Mr Bailey was frequently inconsistent with his evidence. He refers in his statement to a dispute that he allegedly had with with Mr Batzakis, Project Manager for the Respondent in 2007, when he was told by Mr Batzakis that he was to perform picking work. Mr Bailey claims that when this dispute occurred, he referred to his “letter of offer” and the Respondent confirmed it would honour his letter of offer.

Mr Pisano claims he recalled the meeting between Mr Batzakis and Mr Bailey,[55] and that thereafter the Respondent did not request Mr Bailey to perform picking work. The Applicants claim that in 2008 there was a dispute in which the TWU was involved and the “discussion was had”[56] as to “why get grade 2 workers to do grade one work and pay them grade 2 and then get grade one workers to do grade 2 work and pay them grade 2 rates” (the Grade 2 comment). Further, the Applicants claim that the Respondent “agreed” and “the dispute was resolved with no requirement that the forklift drivers do picking work as part of their ordinary duties.”[57]

Mr Malcolm Carrol, another Applicant in these proceedings, claimed that this conversation with Mr Batsakis happened in a walkway where he and Mr Peterson “crossed paths” with Mr Batsakis.[58] It is at this time, when the men have crossed paths, that Mr Carrol claims he made the Grade 2 comment to Mr Batsakis. Mr Carroll claims Mr Batsakis agreed that they were to “stay as they were.” He clarified what he meant by that:

“Yes?‑‑‑Well, the conversation was in reference to the people with letter of offers and forklift operators that said that that's what their primary role was and what was meant by, "Stay as is", was that they'd have priority to do forklift work because that's what they were employed to do.”[59]

I note that the response does not say anything about the Applicants not performing picking work. It was that they would have “priority” to do forklift work. Mr Carrol, accepts that the claimed agreement that arose was “only word of mouth.”[60]

Mr Carrol agreed that a grade 2 and grade 3 employee can perform picking work. He agreed that the dispute had been long running for approximately 10 years,[61] and that the Respondent had maintained the status quo in relation to that dispute, at least up until he left the site in 2015.[62] Mr Carrol was not aware of any written agreement that detailed the practice of not picking pertaining to the Applicants’ ordinary duties.[63] In terms of non-written agreements, Mr Carrol referred to the “word of mouth” conversations with Mr Batsakis in 2008 referred to previously.

Mr Peterson, the TWU delegate at the time, gave evidence that he was involved in the discussion with Mr Carrrol and Mr Batzakis. It is noteworthy that Mr Peterson confirmed that the dispute in relation to the Applicants picking as part of their ordinary duties had been going on for the last 10 years.[64] In light of that concession, Mr Peterson was asked on cross examination how he could say that the Respondent agreed that employees would not be required to pick. In response he referred back to the alleged verbal agreement with Mr Batsakis in 2008.[65] The evidence of Mr Peterson on this point was vague and unconvincing. If there was an agreement with Mr Batzakis, this is inconsistent with the concession that the matter has been in dispute for the last 10 years.

Mr Milburn claimed he contacted Mr Batzakis who informed him that at no time did he agree with any proposition that permanent employees of the Respondent would not be required to pick.[66] I found Mr Milburn to be a most reliable witness, in contrast to Mr Peterson and Mr Carrol, whose evidence was vague and inconsistent. The Applicants seek to discredit Mr Milburn and make the claim that he did not understand the nature of the dispute. However, it was apparent in cross-examination that he did.[67]

The Applicants calls for a Jones v Dunkel inference be drawn from the failure of the Respondent to call Mr Batzakis as a witness. The rule in Jones v Dunkel was recently considered by a Full Bench in Hyde v Serco Australia Pty Limited.[68] The relevant consideration can be found in paragraphs [102] – [107] with which I agree and will apply to the circumstances of this matter.

Having regard to that consideration, the rule only applies where a party is required to explain or contradict something, and this depends on the issues thrown up by the evidence in a particular case. In this matter, while the Applicants claim that there was an agreement, this claim is itself was contradicted by numerous of the Applicants who accept that the matter has been the subject of disputation for many years since 2008.

Secondly, the rule only applies to the failure to call a witness who is not a party to the proceedings if it would be natural for the party to call that witness or the party might reasonably be accepted to call the witness in question. Mr Batzakis is no longer an employee of the Respondent and has not been for some time. If he were still an employee, I would be more likely to find it would be natural for the Respondent to call him. However, in all of the circumstances including the Applicants own evidence of ongoing disputation, not agreement, one can hardly conclude that the Respondent might reasonably have been expected to call Mr Batzakis.

For these reasons, the rule in Jones v Dunkel does not apply to the failure of the respondent to call Mr Batzakis. Further, even if the rule did apply, I would not draw the inference having regard to the totality of the evidence.

Mr Peter Whitney, another one of the Applicants also gave evidence. He was asked about agreements to the effect that the Applicants did not perform picking work as part of their ordinary duties. Mr Whitney was unaware as to whether there were any written or unwritten agreements in relation to the Applicants in this proceeding not being required to perform picking work as part of their ordinary duties.[69]

The so-called letter of assurance dated 9 March 2011 from Mr D‘Apice was frequently referred to by Mr Bailey and Mr Pisano. The terms of this letter are detailed at paragraph [47] of this decision.
Mr Bailey claimed that it was his understanding that this letter provided assurance that if any term was omitted from the 2011 Agreement, the Respondent would honour the arrangement.[70] The Applicants submit that this letter meant that “…at an industrial level, it was confirmed to the TWU on 9 March 2011 that the Applicants (amongst others) would not be required to perform picking work as part of their ordinary duties.”[71]

It is apparent from the text of this letter that it makes no reference whatsoever to the issue of picking. It is of no value in determining the matter in dispute. The Respondent submits that under cross examination, the Applicants failed to make this contention out.[72] I agree with this submission. During cross examination, Mr Pisano agreed that the letter from Mr D’Apice was not a term of the Agreement.[73] It is clear that the letter from Mr D’Apice does not provide any evidence that there was an agreement that the Applicants not perform picking as part of their ordinary duties.

The 2011 Dispute

In April 2011, there was a dispute that was notified by the TWU to Fair Work Australia (the 2011 dispute). The Applicants say that the “main focus” of the dispute was the underpayment of wages to some 12 employees of the Respondent (‘dispute 1’). Mr Luke McCrone, a former TWU official was involved in this dispute for the TWU and gave evidence.

Mr McCrone confirmed that the TWU notified Fair Work Australia of a dispute in April 2011 and that the second part of that dispute was related to the letter that Mr Tighe, manager for the Respondent wrote to employees on 17 February 2011.[74] In the letter, Mr Tighe made clear the position of the Respondent on whether warehouse employees would be required to pick (‘dispute 2’). The text of the letter was as follows:

“Several employees have recently approached management with letters and documents purporting to describe their classification designation and the duties contained within. This material is no longer relevant nor does it apply to your employment.
All warehouse employees at the Coles RDC-Altona site are covered by the Linfox Victoria (Coles RDC) Agreement 2008. This Agreement is the principle document that currently applies to your employment and describes the duties to be performed by each grade classification.
Clause 18.2, Classifications, from the Agreement describe the skills and duties that are to be exercised and performed under each Distribution Facility Grade.
For Example (Grade 2):
An Employee who is employed at the Grade 2 level would be expected to perform all tasks at or below that grade which may include but not limited to: administration, housekeeping, loading, forklift and picking duties.
Due to operational requirements and in accordance with the Linfox Victoria (Coles RDC) Agreement 2008, Linfox RDC management may require you to perform one or more of the tasks/ duties as described in your relevant grade classification.”[75]

The evidence of Mr McCrone as to the circumstances surrounding this dispute was inconsistent. For example, Mr McCrone claimed that the dispute referred to in paragraph 7 of his witness statement occurred after Mr Tighe had left the Respondent. That is clearly not the case. Annexure LM1 attached to Mr McCrone’s own statement shows that Mr Tighe was sending emails about the matter in 2012 and Mr McCrone concedes that the dispute lodged in April 2011 was motivated by Mr Tighe.

Mr McCrone accepted when it was put to him that arising out of the applications and subsequent conferences before Commissioner Bissett, two outcomes arose. The first was that it was discovered that a number of former Westgate employees were under classified upon transfer to Respondent which was resolved.[76] Mr McCrone also agreed that the second outcome was that Commissioner Bissett expressed a view that workers who commenced prior to 8:00am, were shift workers and therefore entitled to a crib break.[77] Therefore, it is not contested that ‘dispute 1’ was resolved.

In respect to dispute 2, it was put to Mr McCrone that at no time was there any resolution to the application with respect to that dispute. That part of the dispute in the Form F10 reads:

“Dispute 2
2. Prior to Linfox taking over the Coles contract the work has been done by Westgate, the contract changed hands in approximately December 2007. Upon taking over the contract Linfox provided some employees with a letter stating they would be engaged on the same pay and in the same role.
3. At a meeting on Monday the 28^th of Feb Linfox indicated that it would no longer be honouring the letters of offer and intended to rotate workers out of their current role and into other duties. This position was confirmed a second meeting on Monday the 7^th of March.
4. Some of the duties that the company wish the employees to perform are not described in their current classification.
5. One of the reasons given was that it will enable Linfox to give casuals experience in the duties described in the letters, forklift driving for example. This is in breach of the agreement which states in Part 9 Appendix 1 Wage rates that casuals will not be engaged at classification 2.”[78]

Mr McCrone claimed in response that there was a resolution to dispute 2. When asked what the resolution was, he at first claimed “…the company dropped it.”[79]

The basis of this alleged resolution stems from the words that have been claimed to have been uttered by Commissioner Bissett during a conference, “why get grade 2 people to do grade 1 work under grade 2 rates and then get grade 1 people to do grade 2 work and be paid grade 2 rates?”[80] That is to say, according to Mr McCrone, the Commissioner has uttered virtually the same statement that Mr Carrol claimed in his evidence, that he made to Mr Batzakis in 2008. This seems a most remarkable coincidence.

When it was put to Mr McCrone whether he was he seriously suggesting that the Respondent agreed that forklift drivers would not have to pick, barely two months after the letter from Mr Tighe was issued, stressing the complete opposite state of affairs, he claimed “We rarely settled things in conciliation with Linfox but from time to time it did happen. This is one such occasion.”[81]

However, when essentially the same proposition was put to him minutes later, Mr McCrone said “Well it had gone to a higher level of management, it had gone to you. You were now involved.”[82] Mr Jones, who was conducting the cross examination for the Respondent asked Mr McCrone “So you’re saying I agreed?”

Mr McCrone replied, “You were the decision maker in this case, yes.”[83] This claim is entirely lacking in credibility. Mr McCrone made no such claim as to Mr Jones’ alleged agreement in his witness statement. He then later, when asked if he recalls the Respondent’s response on the same issue, said “Yes, you let them keep driving forklifts” and “I mean its an interesting way to resolve a dispute to lay down and play dead on it for six years.”[84]

This was yet a further change in the evidence of Mr McCrone to one where there was not an agreement, but rather that the Respondent “played dead” and did not pursue its requirement that the Applicants pick.

When questioned further, Mr McCrone was asked where the alleged agreement that the Applicants would not perform picking work was written down, Mr McCrone referred again to the “contracts the guys have produced” and “Apart from that it was all word of mouth.”[85] Mr McCrone was asked about paragraph 8 of his witness statement, that there was a resolution to the dispute to the effect “…the forklift drivers did only forklift driving as part of their ordinary duties. This was the agreement with Linfox and it was reflected in the tracker rosters which Mr Arthur Bregiannis wrote.”[86] Mr McCrone later retracted that statement saying the tracker roster may have been something else, that he was “not exactly 100% sure” and that he thinks the tracker roster was about trying to share the workload equally amongst workers.[87]

On re-examination, Mr McCrone changes his evidence somewhat again, saying that the dispute about the “contractors” was resolved at one of the first conferences at Fair Work Australia on 15 August 2011 and that the alleged Grade 2 Comment from Commissioner Bissett was made at that conference.[88] This claim did not appear in his earlier statement and was not made during lengthy cross examination where he made the various inconsistent claims cited above.

On the whole, the evidence of Mr McCrone was very inconsistent and lacked credibility.

Mr Peterson also gave evidence as to the what happened in the 2011 dispute which was before Commissioner Bissett. Mr Peterson also says that the Commissioner made the comment “why get grade 2 people to do grade 1 work and be paid grade 2 rates and then get grade 1 people to go grade 2 work and be paid grade 2 rates.[89] His evidence was that the Respondent agreed to that proposition, the dispute was resolved. The status quo maintained and that the Respondent withdrew after the conciliation.[90] The Applicants claim that the Respondent agreed to withdraw the dispute where it was seeking former Westgate employees to perform picking duties.[91]

It is apparent from Mr McCrone’s evidence and annexure LM1to his witness statement that the TWU lodged the dispute with Fair Work Australia. It is not apparent how the Respondent could withdraw a dispute it did not lodge. This is a point made forcefully by the Respondent.

Mr Peterson had a slightly different slant on what occurred at Fair Work Australia in 2011. Mr Peterson said that “…she (the Commissioner) hinted towards our way of thinking although the company decided at that particular time to leave it alone.”[92] Mr Peterson was asked about his recollection that the Commissioner made the Grade 2 comment and what he recalled Mr Tighe saying in response. His answer was he cannot recall everything and that he believed he agreed to leave it as status quo.[93] However, there was no clear answer given as to whether Mr Tighe actually said that.[94] On re-examination Mr Peterson said that “it was left as status quo and left alone.”[95]

Mr Whitney also gave evidence as to what occurred during the 2011 dispute. He claimed that the Respondent tried to “change the situation so that Westgate employees could be required to do other duties during their ordinary time of work.”[96] Further, he claimed that the matter was brought to Fair Work Australia, the Respondent withdrew the application and the status quo was maintained.[97] However, Mr Whitney was completely confused about the 2011 dispute notification to the Commission and its purported withdrawal by the Respondent.[98]

Mr Whitney was taken to the evidence from the Applicants’ witness statements which dealt with the disputes about this issue from 2008 - 2015. He agreed that “it was different ones for different times but about the same thing,”[99] and when asked if the Respondent had been attempting to break this dispute for many years, he replied that “Well if they didn’t break their original agreement, we wouldn’t be here.”[100] Mr Whitney referred to the letters of transfer, often referred to as the letters of offer, as what he relied on as “the original agreement.”[101]

Mr Milburn agreed on cross examination that the forklift drivers did not do pick work after this time but said that they avoided having to pick due to the status quo being applied during that period.[102] This is consistent with the evidence of Mr Peterson who also claimed it was left as the “status quo.”

I note that the requirement to maintain the status quo of a matter in dispute has been a feature of the the dispute settlement procedure in every agreement that has applied to the Applicants since at least 2008. However, maintaining the status quo of a matter in dispute does not demonstrate an agreement that the state of affairs continue.

In any event, in 2013, it is apparent the disputation continued. Mr Bailey gave evidence that there was a dispute as the Respondent wanted to rotate forklift drivers into other duties. Mr Bailey’s evidence is that there was a consultative meeting with the TWU, which he says he attended as a TWU representative, where there was a vote put to the forklift drivers. The vote was in favour of no forklift drivers performing rotations in other duties and that the Respondent was advised of the result. The Applicants submit that the Respondent took no further action at this time. This is said to be yet another alleged settlement of the dispute, with the result being that forklift drivers were not required to perform picking work as a part of their ordinary duties. Mr Bailey says there is nothing in writing reflecting this alleged agreement and that it was a verbal agreement with the manager who is no longer an employee of the Respondent.[103] It is a further example of a consistent theme in the Applicants’ own evidence, that the Respondent has repeatedly attempted to have the Applicants perform picking work as a part of their ordinary duties and the Applicants have consistently disputed this and refused to do so. This does not evidence an agreement. Rather, it evidences continuing disputation over the same issue.

Mr Bregiannis gave evidence which he claimed demonstrated an agreement that the Applicants were not required to pick as part of their ordinary duties. Mr Bregiannis claims that in about 2013 and 2014, there was an industrial dispute about the duties to be undertaken by forklift drivers when engaged to perform overtime. Mr Bregiannis claims that to help resolve this dispute, the TWU created rosters which were asked for and used by the Respondent in 2013 and 2014 when rostering its employees. These rosters where referred to as tracker rosters. It is apparent that these are the same rosters that Mr McCrone had referred to in his evidence. As noted earlier, Mr McCrone retracted his evidence that the purported agreement that the forklift drivers did only forklift driving as part of their ordinary duties was reflected in the tracker rosters.

Nevertheless, Mr Bregiannis claims that in 2013, the Respondent agreed that forklift drivers would only be driving forklifts as a part of their ordinary duties and nothing else.[104] However, Mr Bregiannis clarified that his evidence where he claimed that the Respondent recognised that each of the forklift drivers were to drive forklifts as part of their ordinary duties was only in relation to 10 of the Applicants, those who were on afternoon shift.[105]

Mr Bregiannis claimed that there were two industrial arrangements or understandings. One was that the Applicants rostered on the afternoon shift would be on the forklifts, doing forklift duties, from Monday to Friday and the second understanding provided that for four of the Applicants on a Saturday and four on the Sunday shift “to jump on the forklift”.[106] Mr Bregiannis claimed that these understandings were reflected in emails.[107] He also referred to his “tracker” rosters as a source of formalisation of the alleged agreements.[108]

Mr Bregiannis was extensively cross examined on the various emails that formed part of his evidence and that he claimed demonstrated these understandings. It is apparent that a number of these emails related to the claimed arrangement as to how work would be shared on the weekends.[109] It was also apparent that some of the emails referred to concerns about “seniority” being taken account by management in the allocation of work.[110]

Mr Bregiannis seemed confused about what he claimed to be the “status quo” arrangement in relation to the rotation of forklift work in his witness statement, but during cross examination thought it was the “arrangement.”[111] Taken as a whole, Mr Bregiannis’ evidence was a barely disguised attempt to manufacture evidence of an agreement. For example, in respect to the email exchange in Annexure AB5 to his witness statement, when asked where there is evidence of an agreement with anything that Mr Bregiannis said in that exchange, his evidence was “there’s an implied agreement, but that’s coming from me”[112] and later in respect to the email exchange in Annexure AB 7 when asked what in the exchange expresses an agreement with the Respondent, he claimed it was “implied” as there is nothing from the Respondent that denies that it never happened.[113] Again, in respect to the email exchange in Annexure AB 8, Mr Bregiannis claims that an agreement is implied by himself and the Respondent, because the Respondent has not denied it.[114] In respect of the email exchange in Annexure AB9, Mr Bregiannis again claims an agreement is implied.[115] In respect of the email exchange in Annexure AB17, Mr Bregiannis said if he was being explicitly asked where in the exchange was the agreement, he did not know “but it is in the writing.”[116] The relevant parts of the email exchanges referred to above are set out at Appendix 1 to this decision.

Mr Bregiannis claimed that the Respondent used his tracker to allocate forklift work. However, the planning and resources manager at that time, Mr Farrell makes clear in an email that the spreadsheet is not a recognised tool in the business.[117] Mr Bregiannis in replying to that email from Mr Farrell stated that he thinks the managers use it as a guide.[118] In respect of Annexures AB19 and 20, this email exchange makes clear that the Respondent’s management have explicitly advised that his tracker will not be used as a resource. When asked where the evidence is in Annexure AB20 of any agreement with the Respondent he again claimed it was implied.[119]

Consistent with the other Applicants, Mr Bregiannis agreed that the dispute about the group he describes as the contractors (that is how Mr Bregiannis describes the Applicants) has been going “on and off” since at least 2011.[120]

In respect to the 2011 dispute before Commissioner Bissett, Mr Bregiannis confirmed that his knowledge of what the Commissioner actually said was told to him by other TWU delegates.[121] When asked how the Respondent could withdraw the dispute when when it was the TWU that filed the dispute, his reply was “Well it stopped, to my knowledge. I was told at the time that it stopped.”[122] He also claimed in respect to that dispute “what the delegates told me back then was that is just ended-each-I think Linfox withdrew.”[123]

Mr Bregiannis was asked on re-examination what he meant by “various industrial disputes” at paragraph 11 of his witness statement and he replied:

“What were the various industrial disputes you were referring to this?‑‑‑In regards to the flare ups. So things like this, whenever the company actually tried to say "Okay, guys, we want to rotate everyone. All you guys are required to pick". So there was - so whether it went to the Commission, whether it went - whether there were just arguments in the workplace or conversations in the workplace. I think there was on - I think at one stage on afternoon shift - and you're going to have to ask Mal Carroll about this, that it will become more evident because he was a delegate at the time. You know, sometimes it did not go to the Commission, it did not go that far, but there have been various disputes over the years.”[124]

I note that at at one stage of the evidence, Mr Bregiannis argued it is “seniority” that “affords him and the Applicants the right to decide what tasks or duties they will or will not perform.”[125] If that is truly the view of Mr Bregiannis, it is of great concern as there is no basis whatsoever to that claim and it is quite a different claim to one of industrial custom and practice. As stated above, Mr Bregiannis has engaged in an attempt to manufacture an agreement where one does not exist. His evidence was not credible.

Mr Pisano gave evidence that on 15 June 2015, he attended a joint consultative meeting between the NUW and the Respondent, as the NUW delegate.[126] The minutes for this meeting detail the Respondent’s response in relation to the rotation of tasks:

“Current thinking is team member agreements for 38 hours, if partaking in overtime, there is a requirement that they pick.”[127]

The Applicants submit that this is a written acknowledgement in an industrial context, of the Respondent’s agreement that the Applicants are not required to perform picking work as a part of their ordinary duties. I do not agree. What this document clearly indicates is that the the Respondent expects the employees to pick during overtime. It does not indicate in any way, an agreement that they are not required to pick as part of their ordinary duties. It says nothing at all about what the Applicants are required to do or not do as part of their ordinary duties. The Applicants’ own evidence indicates that the requirement to undertake picking as part of ordinary duties was in dispute over many years.

Mr Milburn was clear that there has never been any agreement, arrangement or settlement (formal or informal) agreed to by the Respondent, that the Applicants are not required to perform picking duties.[128] This statement is consistent with the evidence that this is a matter that has been in constant dispute for a decade. In stark contrast to the Applicants’ witnesses, Mr Milburn was a consistent and credible witness. Where there is a conflict on the evidence, I prefer the evidence of Mr Milburn.

Further, the Respondent points to the fact that in the two previous disputes about this matter before the Fair Work Commission, reflected in the first decision and the second decision, no mention was made of any alleged industrial agreement, arrangement or settlement with the Respondent to the effect that the Applicants are not required to perform picking work as part of their ordinary duties. Further, the respondent questions if such an agreement exists, why the Applicants did not rely on it in past proceedings.

The chronology of disputation set out above shows that there has been consistent attempts over many years both before the 2014 Agreement applied to the Applicants and after, by the Respondent to have the Applicants perform picking work as part of their ordinary duties. The ongoing campaign of resistance from the Applicants to comply with the direction of the Respondent, does not evidence that there has been any sort of industrial arrangement or settlement of the matter. There is not a single document in evidence that confirms the “industrial arrangement” the Applicants insist exists. When pressed, most of the Applicants fall back to relying on the letters of offer or contracts as evidence of the agreement. I am not satisfied on the basis of the vague and inconsistent evidence of the Applicants’ witnesses as canvassed above, that there was any such verbal agreement to the effect that the Applicants are not required to pick as part of their ordinary duties.

It is apparent on the evidence that each attempt of the Respondent to have the Applicants pick has been met with refusal to do so. Disputation has followed and the status quo provision in the dispute settlement procedure has been observed. This state of affairs does not evidence agreement, it evidences on going disputation. Disputation that was occurring prior to the the 2014 Agreement and the 2018 Agreement coming into effect.

In conclusion, I am not satisfied on the evidence that there was an industrial agreement, arrangement or settlement that the Applicants are not required to perform picking work as part of their ordinary duties either prior to the 2014 and 2018 Agreements came into force or after.

The history of the industrial regulation of the Applicants’ employment

The Applicants, aside from one, were all formerly employed by Westgate prior to its acquisition by the Respondent in 2007. Since that time, four industrial agreements that cover the RDC where the Applicants work, have covered and applied to the Applicants.

The Westgate agreements applied to the Applicants prior to their engagement by the Respondent. These Agreements incorporated the Transport Workers (Distribution facilities) Award 2004 including clause 14.1 which provides as follows:

“An employer may direct an employee to carry out such duties as are within the limits of the employee’s skill, competence and training consistent with the classification structure of this Award, provided that such duties are not designed to promote de-skilling.”

The Applicants’ contracts with Westgate also included the following:

“Your duties were previously outlined during your interview, however duties and responsibilities of employees are regularly assessed by WL and may change from time to time. On occasions, with fluctuations in operational requirements you may be required to work at another business site or in an alternative warehousing and distribution position. If this occurs, we will give you reasonable notice.”[129]

The first of the succession of Linfox Agreements to apply to the Applicants is the Linfox Victoria (Coles RDC) Agreement 2008 (the 2008 Agreement). This Agreement did not have a provision relating to custom and practice. The 2008 Agreement also incorporated the Transport Workers (Distribution Facilities) Award 2004 including clause 14.1 already set out above. The 2008 agreement also contained clause 3.1.1 (b) which was in the following terms:

“3.1 EMPLOYEES’ DUTIES
3.1.1 Every employee must at all times:
(b) Comply with reasonable and lawful instructions of management”

The second of the succession of Linfox agreements was the Linfox Road Transport and Distribution Centres National Enterprise Agreement 2011 (the 2011 Agreement) This Agreement did not have a provision relating to custom and practice. However, clause 29.1 of the 2011 Agreement stated that “every employee must at all times comply with reasonable and lawful instructions of management.” This agreement also incorporated the Transport Workers Union (Distribution Facilities) Award 2004.

The third of the succession of Linfox agreements was the 2014 Agreement. It is in this Agreement that the custom and practice provision, as set out in clause 5 and replicated earlier, was introduced. However, clause 22(b) of the 2014 Agreement also has a provision that employees must comply with reasonable and lawful directions of management. The Full Bench in the third decision pointed to other contextually relevant (in the task of interpreting what is meant by “custom and practice” in clause 5) provisions in the terms of the 2014 Agreement.

These clauses are:

Clause 15.1 which sets out the objectives of the 2014 Agreement and includes:
c)“develop a highly motivated, multi-skilled, flexible and adaptable workforce which provides training and career paths for all Employees;
e)remove inefficient work practices and processes in all areas of Linfox’s operations to ensure flexible, timely and reliable delivery of services to Linfox and its customers;”
Clause 17 which deals with continuous improvement states that “flexibility in the deployment of labour is extremely important to ensure the long term future of Linfox and its employees;” and
Clause 32 which is the consultation provision requiring the Respondent to consult with employees about major workplace change likely to have significant effect on employees, including in respect of restructuring of jobs. The Respondent is required to give prompt and genuine consideration to matter raised by employees, but the changes do not require consent. Less significant changes do not require consultation.

The 2014 Agreement incorporates the classifications from the Road Transport and Distribution Award 2010 at appendix 1.2.

Clause 34 of 2014 Agreement provides:

“34. FACILITATIVE CLAUSE FOR FURTHER AGREEMENTS AND LOCAL MATTERS
34.1 If, during the life of this Agreement, a new local matters agreement is made or changes are required in respect of existing local agreements made under this clause, the new local agreement or changes to existing local agreements must be agreed between the parties. The new agreement or changes must be agreed to by:
(a) a majority of Employees at the specific worksite; and
(b) the TWU (agreement is to be indicated by the signature of the relevant branch
secretary).

34.2 In the event that it is proposed that a local workplace agreement depart from or
effectively vary a term of this Agreement, the parties will comply with the requirements of the Act in relation to variation of agreements. The agreement will not come into effect until such compliance is complete and the variation commences operation.”

The fourth in the succession of agreements, is the Agreement under consideration in these proceedings, the 2018 Agreement. The 2018 Agreement includes a custom and practice provision in identical terms to the 2014 Agreement at clause 5.

There are some additional clauses in the 2018 Agreement that are not in the previous Agreements, as the Applicants point out in their final submissions. These clauses are 15.1(f) and clause 15.1(g) detailed below:

(f)enhance the productivity and efficiency of Linfox’s operations;
(g)enhance the safety and fairness of Linfox’s operations

Clauses 15, with the exception of the addition of 15.1 (f) and 15.1 (g) detailed above, 17 and 32.3 have identical provisions to those referred to in the 2014 Agreement and produced above that were referred to by the Full Bench in the third decision. The 2018 Agreement also includes an analogous provision that has been in every agreement since 2011 at 22.1(b), that every employee must at all times comply with reasonable and lawful instructions of management. I note the Applicants submit that none of these additions are relevant to the dispute.[130] This is a curious submission as the Applicants spend some time dealing with clause 32 later in their submissions.[131] In any case, I consider that at least clause 15.1(f) and 15.1 (g) of the 2018 Agreement is contextually relevant in construing the clause in the same way that clause 15.1 (c) and (e) and clause 17 referred to above are. I will return to these provisions later in the decision.

Further, clause 32.3 of the 2018 Agreement provides:

“In addition to the above, where there is a proposed change to Employees regular rosters or ordinary hours of work Linfox must provide information to the Employees about the change and invite the affected Employees to give their views about the impact of the change, including any impact in relation to their family or caring responsibilities.”

The 2018 Agreement also incorporates the classifications from the Road Transport and Distribution Award 2010. The Applicants are presently classified and remunerated as Distribution Facility Employees. The classifications definitions for a distribution facility employee from the incorporated award provisions are as follows:
“Distribution facility employee level 1
B.1.1Skills/Duties
(a)Responsible for the quality of their own work subject to detailed direction.
(b)Works in a team environment and/or under routine supervision.
(c)Undertakes duties in a safe and responsible manner.
(d)Exercises discretion within their level of skills and training.
(e)Possesses basic interpersonal and communication skills.
(f)Must be competent to perform one or more of the following tasks/duties:
(i)storing and packing of goods and materials in accordance with appropriate procedures and/or regulations;
(ii)preparation and receipt of appropriate documentation including liaison with suppliers;
(iii)allocating and retrieving goods from specific warehouse areas;
(iv)basic visual display unit (VDU) operation;
(v)periodic housekeeping and stock-checks; or
(vi)operating company small delivery vehicle.
B.2Distribution facility employee level 2
B.2.1Skills/Duties
(a)Able to work from complex instructions and procedures.
(b)Able to co-ordinate work in a team environment under limited supervision.
(c)Responsible for the quality of their own work.
(d)Possesses sound interpersonal and communication skills.
(e)Must be competent to perform one or more of the following tasks/duties:
(i)inventory and distribution facility control, including:
· licensed operation of all appropriate materials handling equipment;
· use of tools and equipment within the warehouse (basic non-trades maintenance);
(ii)VDU operation; or
(iii)operates three to six tonne truck.
(f)In addition to the above, may possess a duly recognised first aid certificate.
B.3Distribution facility employee level 3
B.3.1Skills/Duties
(a)Understands and is responsible for quality control standards.
(b)Possesses an advanced level of interpersonal and communication skills.
(c)Competent keyboard skills.
(d)Sound working knowledge of all distribution facility duties performed at levels below this grade, exercises discretion within scope of this grade.
(e)May perform work requiring minimal supervision either individually or in a team environment.
(f)Must be competent to perform one or more of the following tasks/duties:
(i)use of a VDU for purposes such as the maintenance of a deposit storage system, information input/retrieval, etc;
(ii)operation of all materials handling equipment under license, where required;
(iii)development and refinement of a distribution facility layout including proper location of goods and their receipt and dispatch; or
(iv)operates truck with a capacity in excess of six tonnes up to and including 13.9 tonnes GVM.
(g)In addition to the above, may be responsible for the proper application and maintenance of appropriate occupational health and safety standards.”

I agree with the observation of the Full Bench and in particular that which has been emphasised above. Having regard to the facts determined in this matter, it apparent that the majority of the Applicants have in fact performed picking work during their ordinary duties.[155] While the Full Bench observed that the mere fact that employees have never previously performed a task is not likely to be sufficient to establish that there is a custom and practice, the facts are that the Applicants do not even meet that threshold of having never performed the picking task as part of their ordinary duties. I have found consistent with the earlier finding of Commissioner Gregory that the Applicants do not regularly perform picking work as part of their ordinary duties. The reason this is the case is the continual refusal of the Applicants to pick as a part of their ordinary duties, despite the efforts over the years of the Respondent to have them do so.

This has led in turn to numerous disputes over a number of years and application of the status quo provisions of the various enterprise agreements applying to the Applicants over the period of time. The evidence shows the true state of affairs is ongoing disputation over this matter, not the application of a custom and practice. Thus, applying the first of the observations of the Full Bench to the facts of this matter, it is apparent that the claimed industrial custom and practice of the Applicants not picking as part of their ordinary duties has not been established.

The second observation made by the Full Bench was as follows:

“[35]Further, in an industrial setting, it is often the case that a custom and practice is something that has emerged from an industrial arrangement or settlement, and which is acknowledged by those who were party to or involved in it. We note that the second principle in Con-Stan would probably capture many circumstances that could be described as a ‘custom and practice’ preserved through enterprise agreements – namely, adapting the words, something that is ‘so well-known and acquiesced in that everyone [voting to approve an enterprise agreement] in that situation can reasonably be presumed to have imported that term into [the enterprise agreement].’ This formulation has some appeal in the setting of enterprise agreements; unless the custom and practice is notorious, there will be doubt about whether employees (particularly more recently hired employees) voting on the agreement understood that it was embraced by any reference to ‘custom and practice’ in the instrument.”[156](emphasis added)

I agree with this observation of the Full Bench and in particular that which is emphasised above. I have determined in the consideration above, that the evidence does not demonstrate that there is any industrial arrangement or settlement in existence. The custom and practice held to exist by the Applicants is, having regard to the facts nowhere near being notorious or so well-known and acquiesced in that everyone could be presumed to have imported that term into an enterprise agreement. In that context, employees voting for the agreement could not have understood it to embrace the alleged custom and practice.

The third observation of the Full Bench deals with the proper construction of clause 5 in the context of the entire provision and the Agreement as a whole. The observation of the Full Bench in the third decision is as follows:

“[36] In the present setting, clause 5.1 would need to be interpreted in the context of the entire provision and the Agreement as a whole. Clause 5 states:

“5. CUSTOM AND PRACTICE
5.1 This Agreement is not intended to, nor shall it, alter a custom and practice applicable to the parties.
5.2 It is the intention of the parties to this Agreement to, during the Term, attempt to reduce to writing any custom and practice applicable to Linfox and the Employees.
5.3 The parties will review and where agreed create a local agreement arising from the custom and practice in accordance with Clause 34.
5.4 Any dispute about the operation of this clause is to be dealt with in accordance with the disputes procedure in the Agreement.”

[37] Several textual considerations should be noted. First, clause 5.1 states that ‘this Agreement is not intended to, nor shall it, alter a custom and practice applicable to the parties.’ It would be necessary to ascertain precisely which clause or clauses in the Agreement were said to alter the alleged custom and practice. Perhaps clause 22 of the Agreement could be said to be such a provision. This requires employees to comply with reasonable and lawful instructions of management at all times. However, as discussed below, clause 22 has existed in the same terms in the past three enterprise agreements, unlike clause 5, which is a new provision. In our view it is not meaningful to speak of the Agreement ‘altering custom and practice’ in this way. Through clause 22 the Agreement does not appear to have altered anything.
[38] Secondly, there is some question as to the identity of the ‘parties’ referred to in clause 5.1. The term is not defined. Under the FW Act, there are, strictly speaking, no ‘parties’ to enterprise agreements, a point noted by the Full Bench in Berri. When clause 5.1 is read with clause 5.2, it appears that the ‘parties’ in question are ‘Linfox and the Employees’. This could include some of the employees at only one of the many sites covered by the Agreement. However, clause 5.3 calls up clause 34, which provides that new ‘local matters agreements’ must be agreed by a majority of employees at the worksite and the TWU, suggesting that the union might also be a ‘party’. We note that clause 5.2 refers to the ‘intention of the parties’ to attempt to reduce to writing any custom and practice applicable to them. The fact that they might not succeed in doing so does not affect the question of whether the custom and practice exists.

[39] We have earlier addressed the significance of clause 22.1(b), which requires that employees comply with lawful and reasonable instructions of management. Another contextually relevant provision is clause 15.1 of the agreement, which sets out the objectives of the Agreement. These include to ‘develop a highly motivated, multi-skilled, flexible and adaptable workforce’ and to ‘remove inefficient work practices and processes in all areas of Linfox’s operations’. Furthermore, clause 17, which deals with continuous improvement, states that ‘flexibility in the deployment of labour is extremely important to ensure the long term future of Linfox and its employees’. In addition, the Agreement contains a consultation provision (clause 32) that requires the company to consult with employees about major workplace change likely to have significant effect on employees, including in respect of the restructuring of jobs. The company is required to give prompt and genuine consideration to matters raised by employees, but the changes do not require consent. Less significant changes do not require consultation at all under these clauses.
[40] In our view, these provisions are contextually relevant to the question of interpreting what is meant by ‘custom and practice’ for the purposes of clause 5.1 of the Agreement. An agreement that seeks to develop a flexible and adaptable workforce, specifically in relation to the deployment of labour, and requiring consultation (but not consent) about major change points in favour of a construction of clause 5.1 that would not too readily recognise prohibitions on changes to working arrangements and employees’ duties. Of course, the true extent of such changes would be relevant. However, returning to the judgment in Con-Stan as a source of interpretative inspiration (rather than formal application), we note the Court’s observation that the ‘presumed intention of the parties, on which the importation of the custom rests, … must yield to their actual intention as embodied in the express terms of the contract ..’[157] As noted in Berri, there are no parties to enterprise agreements, and analogies with contract law should be approached with caution. But in respect of those who made the Agreement under s.182 of the FW Act, it is relevant to consider whether they really intended clause 5.1 to preserve the type of practice (or rather non-practice) that is said by the appellants to exist here, given the other provision to which we have referred above. We think this is unlikely.” [158]

I agree with and adopt the observations of the Full Bench as the correct approach to determining the construction of the Agreement. As to the first matter raised above, in relation to what clause or clauses in the Agreement were said to alter the alleged custom and practice, it is not clear from the Applicants submissions, what they contend in this regard. As the Full Bench points out in respect to the 2014 Agreement, clause 22 requires employees to comply with lawful and reasonable instructions of management has existed in the same terms (and exists in the same terms in the 2018 Agreement) in the past three enterprise agreements unlike clause 5 which was a new provision in the 2014 Agreement. In that context, clause 22 has not altered anything. There are some new provisions in the 2018 Agreement, as is pointed out by the Applicants in their final submissions as set out in above.[159] However, the Applicants submit that none of those matters concern the dispute currently before the Commission. I accept the submissions of the Applicants on this point. It is not apparent that there are any clauses in the 2018 Agreement which could be said to alter the alleged custom and practice even if one were to exist.

The Full Bench considers the question of the identity of the parties to the 2014 Agreement and considers that some of the employees at one of the many sites covered by the 2018 Agreement could be a party and that the the TWU might also be a party given the operation of clause 34. All of these clauses are in identical terms to the 2018 Agreement under consideration in this decision. It is apparent that in respect to the 2018 Agreement, that the parties, be it a group of employees or the union, have not reduced to writing any custom and practice applicable to them. I agree with the Full Bench that this does not affect whether the custom and practice exists. However, for the reasons set out elsewhere above, I am not satisfied there is an industrial custom and practice.

As to the contextual consideration of the Full Bench above in respect to the other provisions in the 2014 Agreement including clause 22.1(b); clause 15(c) and (e) and clause 32 which requires the company to consult with employees about major workplace changes. All of these clauses are identical in the 2018 Agreement, with the exception of the additional provisions at clause 15.1 (f) and (g) and clause 32.2, which in the 2018 Agreement includes the requirement to consult about changes to regular rosters or ordinary hours of work. However, again as was the case and observed by the Full Bench with reference to the 2014 Agreement, the changes do not require consent and less significant changes to major change do not require consultation at all. Therefore, the contextual observations the Full Bench made in respect to these provisions are equally applicable to a consideration of the 2018 Agreement. I agree with observations of the Full Bench that the various clauses cited are contextually relevant to the question of interpreting what is meant by custom and practice for the purposes of clause 5.1 of the Agreement. Having regard to and adopting the consideration of that matter, in paragraphs [39] and [40] of the Full Bench decision, one must consider if those that made the Agreement intended clause 5.1 to preserve the alleged non-practice of not performing picking work as part of the Applicants’ ordinary duties given the other provisions referred to. The Full Bench thought it was unlikely that it would be so.[160] In my view, it is apparent from the foregoing contextual consideration that it cannot be the case that those who made the Agreement, could have had that intention. Further, the addition of clauses 15.1 (f) and 15.1 (g) in the 2018 Agreement which refer to enhancing productivity, safety and fairness of the Respondent’s operations as objectives of the agreement, add further weight to that contextual consideration.

Finally, the Full Bench considered the matter of the chronology of the various Agreements that have covered and applied to the employees during the relevant time. Their observations on this point were as follows:

“[41] A further significant matter is that the custom and practice referred to in clause 5 must be one that existed at the time the Agreement was made, rather than one that developed after the Agreement was made. This seems to us clear from the ordinary meaning of the words in clause 5. The Agreement cannot alter that which did not exist when the Agreement was made. Further, were it otherwise, the clause would likely purport to authorise a variation to the Agreement otherwise than in accordance with Division 7 of Part 2-4 of the FW Act (see the decision of Full Court of the Federal Court in Toyota Motor Corporation Australia Ltd v Marmara.[161] Further, on the first day of the Agreement’s operation, ‘custom and practice’ could only refer to something that had become established prior to that point. This directs attention to the enterprise agreement that applied before the Agreement came into operation; and, as the custom and practice in the present matter is said to be one of long standing, to earlier predecessor agreements.
[42] In this regard, prior to the Agreement coming into operation, the employment of the employees in question was covered by the Linfox Road Transport and Distribution Centres National Enterprise Agreement 2011 (2011 Agreement). This instrument contained no provision relating to custom and practice. However, clause 29.1 of that agreement stated that ‘every employee must at all times comply with reasonable and lawful instructions of management’ (see clause 29.1(b), which is in the same terms as clause 22.1(c) of the 2015 Agreement).
[43] The collective agreement that applied to the relevant employees prior to the commencement of the 2011 Agreement was the Linfox Victoria (Coles RDC) Agreement 2008 (2008 Agreement). It too contained no custom and practice provision. Like the Agreement and 2011 Agreement, it contained a provision (clause 3.1.1(b)) that required employees to comply with reasonable and lawful instructions of management. It also incorporated the Transport Workers (Distribution Facilities) Award 2004 (2004 Award) at Appendix 2. Clause 14.1 of the incorporated Award stated that the employer may direct employees to carry out such duties as are within the limits of their skill, competence and training, consistent with the classification structure of the award, provided they are not designed to promote de-skilling.
The classification structure in clause 18 of the 2004 Award was based on skills and duties; it did not provide for designated roles, such as ‘forklift driver’.
[44] Accordingly, when the new ‘custom and practice’ provision appeared in the Agreement, it did so against a background of industrial regulation that afforded Linfox the right to direct employees to follow lawful and reasonable instructions and, at least from 2008 to 2011, additional discretion to have employees carry out such duties as were within the limits of their ‘skill, competence and training’.
[45] Any fresh dispute that might be brought to the Commission seeking to establish that there exists an ‘industrial’, rather than ‘contractual’, custom and practice for the purposes of clause 5 of the Agreement, to the effect that the employees in question do not do pick work as part of their ordinary duties, would need to explain how the alleged custom and practice developed or survived in the context of the industrial instruments discussed above, including in particular, the Agreement itself.”

As discussed, the 2018 Agreement, the subject of this dispute, contains an analogous provision to the custom and practice provision in clause 5 of the 2014 Agreement that the Full Bench considered and therefore their observations continue to be relevant to the consideration here. That is, there needs to be an explanation of how the alleged custom and practice developed or survived in the context of the industrial instruments that preceded the 2014 Agreement including the 2014 Agreement itself. The short point is that there is no acceptable explanation forthcoming from the Applicants to address this matter. The evidence shows that prior to the coming into the effect of the 2014 Agreement, the Applicants performed some picking work as part of their ordinary duties. The evidence also shows that the reason this was the case was that the Applicants and the Respondent were in frequent dispute over the matter with the Applicants refusing to undertake requests of the Respondent that they perform picking work as part of their ordinary duties. Further, the evidence does not support a finding that there was any industrial agreement, arrangement or settlement of the type alluded to by the Applicants.

Moreover, leading up to the time that the 2014 Agreement commenced operation, the Respondent had the discretion, pursuant to the relevant industrial instruments and the Applicants’ contracts of employment, to direct the Applicants to perform picking work as part of their ordinary duties and also had the discretion to alter the employees roles and duties subject to the de-skilling issue and general reasonableness. Neither of those limitations, in my view, inhibited the right of the Respondent to have the Applicants perform the picking task as part of their ordinary duties. This fresh dispute that the Full Bench contemplated might be brought has manifestly failed to explain how the alleged custom and practice developed or survived in the context of the industrial instruments that applied to the Applicants since 2008, including the 2014 Agreement and the 2018 Agreement.

Conclusion

The question posed in this arbitration to be answered to resolve the dispute is:

“Is there an “industrial” rather than a “contractual” custom and practice for the purposes of clause 5 of the Agreement, to the effect that the 30 Applicants do not perform picking work as part of their ordinary duties?”

Having regard to the consideration above, the answer to this question is clearly NO. Therefore, the dispute is resolved and the Applicants are forthwith required to comply with a direction from the Respondent to perform picking work as part of their ordinary duties.

In the alternative, the second question to be answered is as follows:

“If the answer to the question is “yes”, is Linfox Australia Pty Ltd prevented from discontinuing that custom and practice?”

The answer to the second question must also be NO. That is, if I am wrong as to the first question and there is in fact an industrial custom and practice to the effect that the 30 Applicants do not perform picking work as part of their ordinary duties, then the Respondent is not prevented from discontinuing that custom and practice.

The reason for reaching that conclusion should be clear from the foregoing consideration of the proper construction of the terms of the agreement set out above. That is, those that made the Agreement cannot have really intended clause 5.1 to preserve the alleged non-practice of not performing picking work as part of the Applicants’ ordinary duties given the other provisions referred to. The reading of those provisions referred to together compel that conclusion. Also, pursuant to the 2018 Agreement, the Applicants are remunerated in accordance with their respective classification levels rate of pay. The entitlement to these rates of pay arise from clause 90.2(c) of the 2018 Agreement. When clause 90.2 (c) and clause 90.2 (f) (which incorporates the Road Transport and Distribution Award 2010, including its classification structure) and clause 90.4 and clause 22.1(b) are read together, then the Respondent can instruct employees in accordance with their classification level to comply with reasonable and lawful instructions of management which they must follow at all times.

Further, the express terms of the Applicants’ employment contracts provide that their “…duties and responsibilities…may change from time to time point” and “…you may be required to work…in an alternative warehousing and distribution position.”[162] It follows that even if there is a custom and practice, the terms of the 2018 Agreement and the Applicants’ contracts of employment do not prevent the Respondent from discontinuing that custom and practice.

I note that, consistent with terms of clause 33.1(f) of the Dispute Resolution term of the 2018 Agreement, this decision is a determination that is binding on the parties.

COMMISSIONER

Appearances:

Ms Jardine, Counsel for the Applicants

Mr Jones for the Respondent

Hearing details:

2018

Melbourne:

June 14, 15

August 6, 7

2019

Melbourne:

April 1, 4

May, 18

Appendix 1: Annexures to Exhibit A1, Witness Statement of Arthur Breggianis

Annexure AB5

Wednesday, 5 February 201 7:54PM

Hey Phill,

Fair enough, I am only trying to save time and hassle from all ensuing arguments we had back them.

And that one meeting, and subsequent versions of the FL tracker gave reduced arguments/ disharmony significantly.

I also forgot to mention Steve Peterson, he should attend as well.

Regards,

AB.

Annexure AB8

Monday, 5 May 2014 3:59PM

Hey Guys,

Can we please ensure that the contractors are being communicated of the 4 and 4 weekend work please. I have been told that there were 5 in on the Sunday.

1.Ante
2.Ian Kin
3.Colin Sherrot
4.Boom Boom (Than Vo)
5.Loc Tran

Can we please ensure that these guys are communicated that the quote of4 has beeb filled up when it happens.

Kind regards,

Arthur Bregiannis

Monday, 10 February 2014 9:53PM

Hey guys,

Just a catchup, the management of the contract FLD, the 4 Sat and 4 Sun, how are they being managed lately?

Kind regards,

Arthur Bregiannis

Annexure AB9

Wednesday, 3 September 2014 3:27PM

Hey Luke,

The contract fork lift drivers have voted to contest the weekend overtime.

Kind regards,

Arthur Bregiannis

Wednesday, 20 August 2014 9:43PM

It seems a big inconvenience to get me out there at 11 and a small inconvenience to get them in at 2, but if that’s what they want I should be able to make it. However if I’m to do an 11pm meeting I have to arrange some other evening meetings with other arvo shifts to make the most out of the late finish, so probably Wednesday next week.

Cheers

Luke McCrone

Tuesday, 19 August 2014 9:25PM

Hey Luke,

The guys are overwhelmingly for a meeting at 2300 this Thursday.

Please let us know if you are able to attend.

AB.

Annexure AB19

Sunday, 14 September 2014 7:07AM

Ian,

Are you ok with me forwarding this to Management,

Friday, 12 September 2014 11:12AM

Hi Arthur, don’t know if this will help much but the conversation with Greg Plummer is summarized below…

Basically he stated that the roster written by Dave Farrell and Tristan will provide for the daily expected needs.

If an individual believes they are not being fairly rotated they should come and see him and he will address the issue.

However if there arises an urgent need for more forkies then the floor manager is allowance to put whoever they want.

When I questions manager Dab as to why he was putting Alan Valencia on the fork he said that he just grabbed the nearest person. So I would say that Dan and Greg are working together on this.

Greg also stated that your roster will not be used as a resource to provide information to the floor manager as to who deserves to be on the forklift, that its too complicated and something that you don’t have any need to be involved in.

Hope this helps in some way.

Ian Morison.

Annexure AB20

Monday, 20 October 2014 8:47PM

Arthur,

Of the 18, none were 4 days.

Of these, those who were on site for 5 days (Mon-Fri), none were one day only.

Don’t understand your comments.

It is not representing the 7 week roster, below is a snapshot of one week, of which I am sure you are aware of.

You have not included the backups in your care of a rotation.

The spreadsheet is not a recognised tool within the business, therefore there is no requirement or expectations to compete by the management team.

David

[1] Exhibit A6, Statement of Agreed Facts document.

[2] Exhibit R8, Witness Statement of Brendan Milburn dated 1 April 2019 as amended, AnnexureBM-7.

[3] Exhibit A6, Statement of Agreed Facts document.

[4] Transcript 1 April 2019, PN979.

[5] Exhibit FWC1, Questions to be answered.

[6] [2016] FWC 3039.

[7] [2017] FWC 5751.

[8] [2018] FWCFB 1563.

[9] [2016] FWC 3039 at [2].

[10] AE406887.

[11] [2016] FWC 3039 at [7].

[12] Ibid at [14] – [15].

[13] Ibid at [40].

[14] Construction, Forestry, Mining and Energy Union v Blair Athol Coal [1996] AIRC 1778, Print N4979.

[15] [2016] FWC 3039 at [73].

[16] Ibid at [75].

[17] [2017] FWC 5751.

[18] Con-Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Australia) Ltd (1986) 160 CLR 226.

[19] [2017] FWC 5751 at [67].

[20] [2017] FWC 5751 at [75].

[21] Ibid at [79].

[22] Ibid at [83].

[23] [2016] FWCFB 443.

[24] Ibid at [28].

[25] [2018] FWCFB 1563 at [19].

[26] [2018] FWCFB 1563.

[27] Ibid at [33] – [45].

[28] Transcript 6 August 2018, PN1631; PN1641; PN1673; PN1686.

[29] Transcript 1 April 2019, PN152 -PN153.

[30] Transcript 1 April 2019, PN271-4; PN282; PN307-9; PN338-9; PN347; PN360; PN363-5; PN378; PN390; PN400; PN406; PN415; PN421; PN427; PN433-4.

[31] Transcript 1 April 2019, PN1440; PN1463.

[32] Respondent’s Final Submissions, filed 13 May 2019, at [36] – [42].

[33] Applicants’ Final Submissions, filed 29 April 2019 at [28]; Transcript 1/4/19, PN443.

[34] Transcript 4 April 2019, PN1985-88.

[35] Exhibit A14, Witness Statement of Mel Bailey dated 7 June 2018, Annexure MB5.

[36] Transcript 4 April 2019, PN2100.

[37]Applicants’ Final Submissions, filed 29 April 2019 at [29].

[38] Exhibit A10, First Witness Statement of Frank Pisano dated 4 May 2018, Annexure FP3.

[39] Ibid.

[40] Transcript 1 April 2019, PN660-PN661; PN652- PN653.

[41] Transcript 1 April 2019, PN177.

[42] Transcript 1 April 2019, PN464-465.

[43] Exhibit A14, Witness Statement of Mel Bailey dated 7 June 2018, Annexure MB1.

[44] Transcript 1 April 2019, PN512.

[45] Transcript 1 April 2019, PN551.

[46] Transcript 1 April 2019, PN553.

[47] Transcript 1 April 2019, PN580.

[48] Transcript 1 April 2019, PN585.

[49] Transcript 1 April 2019, PN596.

[50] Transcript 1 April 2019, PN605.

[51] Transcript 1 April 2019, PN611.

[52] Transcript 1 April 2019, PN619 - PN622.

[53] Transcript 1 April 2019, PN628.

[54] Transcript 1 April 2019, PN660.

[55] Transcript 1 April 2019, PN647 - PN651.

[56] Applicants’ Final Submissions, filed 29 April 2019 at [34].

[57] Applicants’ Final Submissions, filed 29 April 2019 at [34].

[58] Transcript 7 August 2019, PN4268.

[59] Transcript 7 August 2019, PN4274.

[60] Transcript 7 August 2019, PN4338-41.

[61] Transcript 7 August 2019, PN4322.

[62] Transcript 7 August 2019, PN4332.

[63] Transcript 7 August 2019, PN4338.

[64] Transcript 7 August 2019, PN3053 - PN3058.

[65] Transcript 7 August 2019, PN3106; PN3111; PN3121.

[66] Exhibit R8, Witness Statement of Brendan Milburn dated 1 April 2019 as amended, at [234].

[67] Transcript 4 April 2019, PN2433.

[68] [2018] FWCFB 3989.

[69] Transcript 7 August 2018, PN3937-3938.

[70] Exhibit A13, Witness Statement of Melt Bailey dated 9 May 2018 at [5].

[71] Applicants’ Final Submissions, filed 29 April 2019 at [42].

[72] Transcript 1 April 2019, PN511-12; PN1142-3.

[73] Ibid.

[74] Transcript 14 June 2018, PN738 - PN739.

[75] Exhibit R8, Witness Statement of Brenden Milburn dated 1 April 2019, as amended, Annexure BM76.

[76] Transcript 14 June 2018, PN768-775.

[77] Transcript 14 June 2018, PN776.

[78] Exhibit R8, Witness Statement of Brenden Milburn dated 1 April 2019, as amended, Annexure BM76.

[79] Transcript 14 June 2018, PN780.

[80] Transcript 14 June 2018, PN828

[81] Transcript 14 June 2018, PN384.

[82] Transcript 14 June 2018, PN884.

[83] Transcript 14 June 2018, PN884.

[84] Transcript 14 June 2018, PN854.

[85] Transcript 14 June 2018, PN924 - PN925

[86] Exhibit A4, Witness Statement of Luke McCrone dated 8 May 2018 at [8].

[87] Transcript 14 June 2018, PN936

[88] Transcript 14 June 2018, PN1116.

[89] Exhibit A7, Witness statement of Stephen Peterson, at [6].

[90] Ibid.

[91] Ibid.

[92] Transcript 7 August 2018, PN3093.

[93] Transcript 7 August 2018, PN3184.

[94] Transcript 7 August 2018, PN3185-3196

[95] Transcript 7 August 2018PN3538

[96] Exhibit A8, Witness Statement of Peter Whitney at [6].

[97] Ibid.

[98] Transcript 7 August 2018, PN3826 - PN3831.

[99] Transcript 7 August 2018, PN3826.

[100] Transcript 7 August 2018, PN3927.

[101] Transcript 7 August 2018, PN3930.

[102] Transcript 4 April 2019, PN2331 - PN2332; PN2483.

[103] Transcript 1 April 2019, PN463 -PN465, PN511 -PN512.

[104] Transcript 14 June 2018, PN432

[105] Transcript 14 June 2018, PN321-345.

[106] Transcript 14 June 2018, PN445

[107]Transcript 14 June 2018, PN446.

[108] Transcript 14 June 2018, PN512.

[109] Transcript 6 August 2018, PN1705; PN1764.

[110] Transcript 6 August 2018, PN2008; PN2069.

[111] Transcript 6 August 2018, PN2004.

[112] Transcript 6 August 2018, PN2026.

[113] Transcript 6 August 2018, PN2079.

[114]Transcript 6 August 2018, PN2082.

[115] Transcript 6 August 2018, PN2115.

[116] Transcript 6 August 2018, PN2322.

[117] Transcript 6 August 2018, PN2155.

[118] Transcript 6 August 2018, PN2166.

[119] Transcript 6 August 2018, PN2398.

[120] Transcript 6 August 2018, PN2542

[121] Transcript 6 August 2018, PN2481

[122] Transcript 6 August 2018, PN2474

[123] Transcript 7 August 2018, PN2773

[124] Transcript 7 August 2018, PN2793.

[125] Transcript 6 August 2018, PN1931 - PN1938

[126] Exhibit A10, First Witness Statement of Frank Pisano dated 4 May 2018 at [8].

[127] Exhibit A10, First Witness Statement of Frank Pisano dated 4 May 2018, Annexure FP5.

[128] Exhibit R8, Witness Statement of Brenden Milburn dated 1 April 2019, as amended, at [212].

[129] Exhibit R8, Witness Statement of Brenden Milburn dated 1 April 2019, as amended, Annexure BM47.

[130] Applicants’ Final Submissions, filed 39 April 2019 at [20].

[131] Applicants’ Final Submissions, filed 39 April 2019 at [105] – [113].

[132] Exhibit A1, Witness Statement of Arthur Bregiannis 7 May 2018 at [6], [11] & [13]; Transcript 14 June 2018, PN458-9, PN504-8, PN642; Transcript 6 August 2018, PN1916; PN2198-2234.

[133] Transcript 14 June 2018, PN924; PN1056-7.

[134] Transcript 7 August 2018, PN3460.

[135] Transcript 7 June 2018, PN3655-6; PN3794-5; PN3807-9.

[136] Transcript June 2018, PN4274.

[137] Transcript 1 April 2019, PN660-1, PN1652-3

[138] Exhibit A13, Witness Statement of Melt Bailey dated 9 May 2018 at [9] - [10]; Transcript 1 April 2019 PN1190-3

[139] Respondent’s Final Submissions, filed 13 May 2019 at [27] - [34].

[140] Transcript 4 April 2019, PN1931-PN1942.

[141] Exhibit R8, Witness Statement of Brenden Milburn dated 1 April 2019, as amended, Annexure BM76.

[142] Transcript 1 April 2019, PN1156 – PN1160.

[143] Exhibit R8, Witness Statement of Brenden Milburn dated 1 April 2019, as amended, at [217].

[144] [2019] FCA 51.

[145] Ibid.

[146] Ibid.

[147] Ibid.

[148] Transcript 17 May 2019, PN2772.

[149] Transcript 17 May 2019, PN2783.

[150] [2017] FWCFB 3005.

[151] [2017] FWCFB 4487.

[152] [2017] FWCFB 3005 at [114].

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

[154] [2018] FWCFB 1563.

[155] [2019] FWC 7345 at [139]

[156] [2018] FWCFB 1563 at [35].

[157] Con-Stan Industries of Australia Pty Ltd v Norwich Winterthur Insurance (Australia) Ltd (1986) 160 CLR 226 at 237.

[158] [2018] FWCFB 1563 at [36] – [40].

[159] Applicants’ Final Submissions, filed 29 April 2019 at [19].

[160] [2018] FWCFB 1563 at [40]

[161] (2014) 222 FCR 152.

[162] [2017] FWC 5751 at [78] – [80].

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