Police Federation of Australia v Victoria Police/Chief Commissioner of Police
[2013] FWC 2649
•10 MAY 2013
[2013] FWC 2649 |
FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.739—Application to deal with a dispute
Police Federation of Australia
v
Victoria Police/Chief Commissioner of Police
(C2012/3824)
State and Territory government administration | |
DEPUTY PRESIDENT SMITH | MELBOURNE, 10 MAY 2013 |
Reimbursement of relocation expenses.
Introduction
[1] The Police Federation of Australia (PFA) have notified a dispute about the proper application of Clause 90 of the Victorian Police Force Enterprise Agreement 2011 (the Agreement). Clause 90 deals with relocation expenses as a result of a transfer.
[2] The controversy between the PFA and Victoria Police is whether or not the clause comprehends the payment of the Goods and Services Tax on the construction of their residence.
[3] There is no jurisdictional issue to the Commission hearing this matter under clause 11—dispute resolution.
The clause and the Agreement
[4] The focus is clause 90.14, 90.15 and 90.16 which provides:
“90.14 Purchase costs will not be reimbursed until an employee has sold the residence at the old location and received reimbursement for sale costs as specified in sub-clause 90.11. This provision does not apply to employees who are vacating a required to occupy residence.
90.15 The employee must purchase or enter into a contract to purchase a residence, land on which to build a residence, or build a residence within four years from the date of notification of the transfer in the Police Gazette.
90.16 An employee may be reimbursed the costs associated with the purchase of a residence for an employee’s permanent occupation at the new location, up to a maximum price as specified in Schedule C, including:
(a) professional costs and disbursements paid to a solicitor; and
(b) all other costs incurred (including but not limited to stamp duty and registration fees on the transfer and any mortgages, valuation fees but not a procuration fee associated with a mortgage).”
[5] It is argued by the PFA that the GST component is a cost associated with constructing their residential homes. It is submitted that whilst there is a discretion contained in clause 90.16 that discretion must be exercised reasonably [see Pulle v. Commonwealth of Australia [2011] FWA 7462].
[6] Victoria Police submitted that the clause provided a discretion as to whether or not to reimburse an employee for GST costs associated with the purchase of a residential property and that Victoria Police had decided that it would not exercise its discretion at any stage to reimburse the GST component.
[7] The second aspect of the argument was that GST was not covered by the clause because the examples given in clause 90.16(b) did not include GST. Victoria Police also rejected the argument that Victoria Police had accepted that GST was a cost associated with the purchase of a residential property as this was done on a misunderstanding of the proper operation of clause 90.16.
The Approach to Construction of an Agreement
[8] There is no disagreement that the well known decisions of Amcor v. Construction, Forestry, Mining and Energy Union [[2005] 214 ALR 56] and Kucks v. CSR Ltd [[1996] 66IR 182] are relevant cases upon which to approach the task of construction.
[9] In Kucks Justice Madwick stated, amongst other things:
“It is trite that narrow or pedantic approaches to the interpretation of an award are misplaced” [[1993] 40 FCR at 511].
[10] Justice Mason in K & S Lake City Freighters Pty Ltd v. Gordon & Gotch stated:
“Problems of legal interpretation are not solved satisfactorily by ritual incantations which emphasize the clarity of meaning which words have when viewed in isolation divorced from their context” [[1985] 157 CLR 309].
Conclusion
[11] If I take the first proposition advanced by Victoria Police that a discretion exists then it accepts that GST can be comprehended by the phrase “costs associated with the purchase of a residence”.
[12] Such a construction would be consistent with the earlier practice by Victoria Police until it believed that it was making a factual error.
[13] The second line of argument appears to me to fall foul of the approach in Kucks namely the narrow or pedantic approach to the interpretation of the instrument is misplaced.
[14] There is no reason, in my view, to read clause 90.16 narrowly. Applying the language of the clause in a way which uses the ordinary and natural meaning of a “cost associated” would mean that the GST can properly be considered a cost associated with the purchase of a residence including the alternatives referred to in clause 90.15. It can be seen that Clause 90.16(b) contains examples after the words “including but not limited to”. This is not a constraining provision indeed it is the reverse.
[15] However, I am now presented with a problem. Victoria Police take the view that it will never exercise its discretion in favour of paying the GST component and the PFA have the expectation that it will always be paid. Both positions are inconsistent with a discretionary judgement which must admit of a yes or no answer in particular circumstances—some guidance may be obtained when consideration is given to how the discretion is exercised in the matters contained in 90.16(a) and (b).
[16] I do not comment on the cases of the specific Officers at this stage but prefer instead to refer the parties into conference now having the benefit of this decision so that consideration can be given to each claim.
DEPUTY PRESIDENT
Appearances:
P. Gouliakas for the Police Federation of Australia.
J. Baker on behalf of Victoria Police.
Hearing details:
2012.
Melbourne:
September, 18.
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