Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales v Industrial Relations Secretary

[2017] NSWSC 1473

Supreme Court

New South Wales

• Amendment notes

Medium Neutral Citation:

Public Service Association and Professional Officers’ Association Amalgamated Union of New South Wales v Industrial Relations Secretary [2017] NSWSC 1473

Hearing dates:

7 May and 26 June 2017; 13 July 2017 (written submissions)

Date of orders:

27 October 2017

Decision date:

27 October 2017

Jurisdiction:

Common Law

Before:

Walton J

Decision:

The Court makes the following orders in the consolidated proceedings:

 

(1) The applications for declaration are dismissed.

 (2) There is no order as to costs.

Catchwords:

DECLARATIONS – industrial law – consolidation – top up provisions – workers compensation entitlements – construction of award provisions – principles of award interpretation – inapplicability of principles governing construction of contracts – applicability of principles of statutory construction – implication of terms in awards – Interpretation Act – corresponding provisions – modifications – contrary intention – applications for declarations refused

Legislation Cited:

Conciliation and Arbitration Act 1904 (Cth)
Government Sector Employment Act 2013 (NSW)
Government Sector Employment Regulation 2014 (NSW)
Industrial Relations (Public Sector Conditions of Employment) Regulation 2014 (NSW)
Industrial Relations (Public Sector Conditions of Employment) Regulation 2011(NSW) (repealed)
Industrial Relations Act 1988 (Cth)
Industrial Relations Act 1996 (NSW)
Interpretation Act 1987 (NSW)
Landcom Corporation Act 2001 (NSW)
Police Act 1990 (NSW)
Public Sector Employment and Management (General) Regulation 1996 (NSW) (repealed)
Public Sector Employment and Management Regulation 2009 (NSW) (repealed)
Public Sector Management Act 1988 (NSW) (repealed)
Public Service (General) Regulation 1984 (NSW)
Public Service (General) Regulation 1988 (NSW) (repealed)
State Owned Corporations Act 1989 (NSW)
Uniform Civil Procedure Act 2005 (NSW)
Workers Compensation Act 1987 (NSW)
Workers Compensation Legislation Amendment Act 2012 (NSW)
Workers Compensation Regulation 2016 (NSW)
Workplace Relations Act 1996 (Cth)

Cases Cited:

Albury City Council v North Albury Shopping Centre Pty Ltd (1985) 1 NSWLR 220
Amcor Ltd v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241; [2005] HCA 10
Autoclenz Ltd v Belcher [2011] 4 All ER 745; [2011] UKSC 41
Blue Metal Industries Ltd v Dilley (1969) 117 CLR 651; [1970] AC 827
Certain Lloyd's Underwriters Subscribing to Contract No IH00AAQS v Cross (2012) 248 CLR 378; [2012] HCA 56
City of Wanneroo v Australian Municipal, Administrative, Clerical And Services Union (2006) 153 IR 426; [2006] FCA 813
Commissioner for Government Transport v Deacon (1975) 97 CLR 535
Downe v Sydney West Area Health Service (No 2) (2008) 71 NSWLR 633; [2008] NSWSC 159
Forsyth v Deputy Commissioner of Taxation (2004) 62 NSWLR 132; [2004] NSWCA 474
Helmos Enterprises Pty Ltd v Jaylor Pty Ltd [2005] NSWCA 235
Hill v Villawood Sheet Metal Pty Ltd [1970] 2 NSWLR 434
Kucks v CSR Ltd (1996) 66 IR 182
Mainteck Services Pty Ltd v Stein Heurtey SA (2015) 87 NSWLR 633; [2014] NSWCA 184
Meehan v Jones (1982) 149 CLR 572; [1982] HCA 52
Mills v Meeking (1990) 169 CLR 214 at 235
Moran Health Care Services v Woods (1997) NSWCCR 449; [1997] NSWSC 147
Newcastle City Council v GIO General Ltd (1987) 191 CLR 85
Notification under section 130 by the New South Wales Teachers Federation of a dispute with Department of Education and Training re changes to TAFE teacher education programs [2008] NSWIRComm 117
Pan Foods Company Importers & Distributers Pty Ltd v Australia and New Zealand Banking Group Ltd (2000) 170 ALR 579
Pan Foods Company Importers & Distributers Pty Ltd v Australia and New Zealand Banking Group Ltd (2000) 170 ALR 579
Plaintiff M47/2012 v Director-General of Security (2012) 251 CLR 1; [2012] HCA 46
Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28
Promenade Investments Pty Ltd v New South Wales (1992) 26 NSWLR 203
Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales v Secretary of the Treasury (2014) 87 NSWLR 41; [2014] NSWIRComm 23
R v PLV (2001) 51 NSWLR 736; [2001] NSWCCA 282
R v Young (1999) 46 NSWLR 681; [1999] NSWCCA 166
Rail Corp (NSW) v Brown (2012) 82 NSWLR 318; (2012) 219 IR 67
Re Operational Ambulance Officers (State) Award (2011) 207 IR 272; [2011] NSWIRComm 61
Repatriation Commission v Donovan (1985) 8 FCR 252
Roads and Maritime Services v Australian Workers' Union, New South Wales [2013] NSWIRComm 105
Short v FW Hercus Pty Ltd (1993) 40 FCR 511
Sin Poh Amalgamated (HK) Ltd v Attorney General of Hong Kong [1965] 1 WLR 62
State of New South Wales v Stockwell [2017] NSWCA 30
State Transit Authority of New South Wales v Australian Rail, Tram and Bus Industry Union, New South Wales Branch, Bus and Tram Division (2014) 247 IR 129; [2014] NSWIRComm 41
Taylor v The Owners – Strata Plan No 11564 (2014) 253 CLR 531; [2014] HCA 9
Wentworth Securities Ltd v Jones [1980] AC 74
Winter v Ministry of Transport [1972] NZLR 539
Woolworths Ltd v Lister [2004] NSWCA 292

Texts Cited:

Macquarie Dictionary, (7th ed, 2017, Pan Macmillan)

Category:

Principal judgment

Parties:

Public Service Association and Professional Officers’ Association Amalgamated Union of New South Wales (Applicant)
Industrial Relations Secretary (First Respondent)
Commissioner of Police (Second Respondent)
Landcom (Third Respondent)

Representation:

Counsel:
M Gibian (Applicant)
I Taylor SC with A Britt (First & Second Respondents)

  Solicitors:
Maurice Blackburn (Applicant)
Crown Solicitor's Office (First & Second Respondents)
Ashurst (Third Respondent)

File Number(s):

2016/333716

Judgment

1. HIS HONOUR: By further amended applications for declaration under s 154 of the Industrial Relations Act 1996 (NSW) (“the IR Act”) filed 16 May 2017 (“the applications”), the Public Service Association and Professional Officers’ Association Amalgamated Union of NSW (“the applicant”) sought declarations with respect to clauses of five public sector awards made pursuant to s 10 of the IR Act (“the subject awards”) which, in industrial parlance, were known as “top up provisions” or “top up clauses”.

2. Broadly speaking, a top up provision is one which permitted employees whose employment was regulated by the subject awards to use any accrued and untaken sick leave entitlement to make up the difference between an amount of workers compensation payable to the employee under the Workers Compensation Act 1987 (NSW) (“the WC Act”) and the employee’s ordinary rate of pay under the subject awards. The sick leave utilised in this way would be debited against the employee’s sick leave accounts (when used collectively the “top up provisions”).

3. The top up provisions reflect long-standing arrangements with respect to the employment of public servants in New South Wales. The Public Service (General) Regulation 1984 (NSW) (“the 1984 Regulation”) made provision, in cl 74(3), for a public servant to be paid the difference between the compensation payable under the WC Act and the ordinary rate of pay of the public servant after a period of 26 weeks with the amount paid to be debited against the employee’s accrued sick leave.

4. Equivalent provisions was subsequently made in cl 64(3) of the Public Service (General) Regulation 1988 (NSW) and cl 91(3) of the Public Sector Employment and Management (General) Regulation 1996 (NSW) (“the 1996 Regulation”), until its repeal in 2009. No such provision was incorporated in the Public Sector Employment and Management Regulation 2009 (NSW) or the Government Sector Employment Regulation 2014 (NSW). On the history of the subject awards provided by the parties, the top up provisions have existed in two such awards since 1997.

5. Each top up provision contains similar qualifying words, namely, that the provision will only apply to “an employee who continues to receive compensation after the completion of the period of 26 weeks referred to in section 36 of [the WC Act]” (this qualification shall hereinafter be referred to as “the condition”).

6. Immediately prior to 1 October 2012, the WC Act provided that for the first 26 weeks of total incapacity an employee was entitled to receive compensation equivalent to his or her current weekly wage rate in respect of any period of total incapacity (“the Pre-Amendment WC Act”). The expression “current weekly wage rate” was, at that time, defined under s 42(1)(a) of that Act as being relevantly the employee’s award rate of pay. As the actual rate of pay for the employee was almost invariably the award rate of pay, the employee by and large received 100% of his or her actual rate of pay during the first 26 weeks (a limited number of employees may not have received 100% of their actual pay, such as, if they were affected by the limitations applying to shift work and the like: see s 42(6)).

7. At that time, s 37 of the Pre-Amendment WC Act provided that the amount of compensation payable in the case of an incapacitated employee was reduced to 90% of the worker’s average weekly earnings or a prescribed statutory rate as a maximum payment. Most public sector award employees received the statutory rate after 26 weeks. Thus, the top up provisions meant that the employees continued to receive, if totally incapacitated, the award rates after 26 weeks until their sick leave was exhausted. Indeed, it was common ground in these proceedings that, immediately before 1 October 2012, the State of New South Wales provided the employees, regulated by the subject awards, with top up payments in accordance with the top up provisions after 26 weeks if totally incapacitated.

8. It may be noted that the concepts of “incapacity” or “total incapacity” were not defined in the Pre-Amendment WC Act. The expression was interpreted such that “incapacity for work upon which the right to compensation depends is a physical incapacity from doing work in the labour market in which the employee was working or might reasonably be expected to work”: Moran Health Care Services v Woods (1997) NSWCCR 449; [1997] NSWSC 147.

9. On 27 June 2012 the Workers Compensation Legislation Amendment Act 2012 (NSW) (“the Amendment Act”) received assent. The Amendment Act repealed ss 36 and 37 of the Pre-Amendment WC Act, with effect from 1 October 2012, and inserted in their place provisions substantially altering the entitlements of employees under the WC Act. One such change was that the incapacity period of 26 weeks was no longer axial to the determination of compensation benefit in the sense that the entitlements were not aligned to that period of incapacity. The other changes to the benefits afforded employees under the Pre-Amendment WC Act which will be discussed below including changes to whether benefits were afforded to employees when totally or partially incapacitated. (The form of the WC Act after the Amendment Act shall be referred to as the “Post-Amendment WC Act”).

10. Following the Amendment Act, the State refused to permit employees covered by the subject awards to use accrued and untaken sick leave as top up pay. It denied that the top up provisions may be read as conferring a right to top up pay in the light of the new and different entitlements that arose under the Amendment Act.

11. That position was contested by the applicant and resulted in industrial dispute proceedings pursuant to s 130 of the IR Act before the Industrial Relations Commission of New South Wales (“the Commission”). The parties to those proceedings were unable to resolve the dispute in conciliation.

12. The applicant subsequently filed applications to vary the subject awards. The purpose of the variations were, in substance, to vary the awards so as to permit the continued the operation of the top up provisions following the passage of the Amendment Act.

13. However, as at the date of the hearing of these applications, the top up provisions had not been altered to reflect, in terms, the relevantly amended provisions of the WC Act. The Commission proceedings have been held over awaiting this judgment.

14. The controversy to which the applications were directed was whether, save for some limited exceptions, the top up provisions would cease to apply to the employees regulated by the subject awards after the WC Act was amended with effect from 1 October 2012

15. The resolution of the question essentially involved the construction of the top up provisions aided, to the extent applicable, by the provisions of the Interpretation Act 1987 (NSW).

16. Putting aside momentarily the precise form of the declarations sought, the applicant contended for a construction of the provisions as follows: the top up provisions have, at all relevant times before and after the Amendment Act, entitled employees to use accrued and untaken sick leave to make up for the difference between the amount of compensation payable under the WC Act and the employee’s ordinary rate of pay after a period of 26 weeks in circumstances in which employees were experiencing a total incapacity, meaning that they had no current work capacity.

17. The applicant supported that application upon two bases:

1. Section 68(1) and/or (3) of the Interpretation Act permitted the award provisions to be read as referring to the entitlement to compensation in circumstances of an employee with no current work capacity under the amended provisions of the WC Act;

2. Further, and in any event, the award provisions should be read consistently with the traditional approaches to award interpretation, so as to give effect to the obvious purpose and intent of the provisions, notwithstanding the amendments to the WC Act. When understood in the light of the applicant’s submissions, as to the construction of the top up clause, this contention was, to the effect, that top up provision must be read as referring to the WC Act provisions as a source of entitlement to weekly compensation payments such that, notwithstanding changes brought by the Amendment Act, the top up provision continued to enable an employee, after the passage of 26 weeks, to use such leave to top up compensation payments.

18. Those contentions were refuted by the respondents. It was contended that, upon the proper construction of the subject awards the condition concerned only a particular entitlement that arose for the specific period referred to in the Pre-Amendment WC Act and that the provisions at s 68 of the Interpretation Act did not apply, in part, because of the existence of a contrary intention for the purposes of s 5(2) of that Act. For the purposes of this judgment the joinder of issues by the parties as to the operation of the Interpretation Act (see contention in [17(1)] above) shall be referred to as the “Interpretation Act issue” and the issues concerning the construction of the subject awards, in particular the top up provisions (the second issue raised by the applicant) shall be referred to as, in the case of the issues to be resolved in this judgment, the “construction issue”, or, in the context of submissions developed by the applicant in [17(2)], “the further contention”.

19. The respondents, however, accepted that, for some of the employees, the top up provisions had continued effect without requiring them to be read as incorporating any reference to provisions of the WC Act as it was after the Amendment Act. In other words, the respondents contended that the top up payments were preserved for a class of employee by means of savings and transitional provisions in the WC Act and not as a result of (by construction of the top up provisions and/or the operation of the Interpretation Act). I will return to those contentions under the heading “Transitional Arrangements” below.

THE SUBJECT AWARDS AND CONSOLIDATION

20. The applicant made five applications electing to group together in one application some of the subject awards where dealing with the same employment area. Those awards and their respective groupings are as follows:

1. Crown Employees (Public Service Conditions of Employment) Reviewed Award 2009 (reviewed award published 7 December 2012 and 21 October 2016) (“the Conditions Award”);

2. Crown Employees (School Administrative and Support Staff) Award (reviewed award published 29 June 2012 and 15 January 2016) (“the Schools Award”);

3. Crown Employees (SAS Trustee Corporation) Award 2016, including the following versions: Crown Employees (SAS Trustee Corporation) Award 2015 and Crown Employees (SAS Trustee Corporation) Award 2012 (reviewed award published 3 August 2012 and 15 January 2016) (collectively referred to hereinafter as “the SAS Trustee Award”);

4. Landcom Award 2016, including the following versions: Landcom Award 2015 and Landcom Award 2010 (collectively referred to hereinafter as “the Landcom Award”); and

5. Crown Employees (NSW Police Force Administrative Officers and Temporary Employees Award 2009 (reviewed award published 10 August 2012 and 21 October 2016) (“the Police Award”).

21. After the hearing of this matter an order was made, by consent, consolidating the respective proceedings pursuant to r 28.5 of the Uniform Civil Procedure Act 2005 (NSW). That order was made because the declarations sought sprung from essentially the same question or issue and the submissions made by the parties were common for the respective applications. The one area of distinction was that the applicant placed reliance upon some of the top up provisions in the subject awards having been made after the commencement of the Amendment Act. However, that distinguishing feature was effectively neutralised, for the purposes of consolidation, as a result of the further contention by the applicant that the remainder of the awards (made before the Amendment Act) were in a similar position because they were reviewed, with the top up provisions intact, after the passing of the Amendment Act.

22. The respondents in the consolidated proceedings are as follows:

1. The Industrial Relations Secretary is the first respondent, being the deemed employer of public sector employees pursuant to s 50 of the Government Sector Employment Act 2013 (NSW), covered by the Conditions Award, the Schools Award and the SAS Trustee Award, and a party to the Conditions Award and SAS Trustee Award;

2. The Commissioner of the Police is the second respondent, being the deemed employer of the non-executive officers pursuant to ss 50, 82, 82A and 90 of the Police Act 1990 (NSW) covered by the Police Award and a party to the Police Award.

3. Landcom, the third respondent, is a corporation constituted by the Landcom Corporation Act 2001 (NSW), a statutory State owned corporation under the State Owned Corporations Act 1989 (NSW) and, as an employer, is regulated by the IR Act.

23. This judgment concerns the applications in the consolidated proceedings. However, for convenience the resolution of the issues raised in this matter shall be addressed by attention being directed to one award, namely, the Conditions Award. That course is available as the top up provisions in the subject awards were, as earlier mentioned, in similar terms. In particular, the top up provision in the Conditions Award (cl 82.7) is in very similar terms to the top up provisions in Police Award (cl 83.7), the SAS Trustee Award (cl 71.7), the Schools Award (cl 16.11.3) and the Landcom Award (cl 41(7)), respectively.

24. Clause 82 of the Conditions Award was entitled “Sick Leave – Workers Compensation”. Clause 82.7, thereof, contained a top up provision (hereafter referred to as “the top up provision”) in the following terms:

82.7 An employee who continues to receive compensation after the completion of the period of 26 weeks referred to in section 36 of the Workers Compensation Act 1987 may use any accrued and untaken sick leave to make up the difference between the amount of compensation payable under that Act and the employee's ordinary rate of pay. Sick leave utilised in this way shall be debited against the employee.

25. The Conditions Award generally sets conditions of employment, other than salaries, for public sector employees and was made on 28 May 2009. As mentioned above, it has been the subject of two reviews pursuant to s 19 of the IR Act, which occurred after the commencement of the Amendment Act. However, neither review altered the title of or terms of the top up provision which remained unchanged in all material respects since its inception in 1997.

THE DECLARATION

26. The applicant is an industrial organisation registered under the IR Act which has members employed pursuant to and is a party to the Conditions Award.

27. The applicant sought the following declaration with respect to the Conditions Award:

1. That cl 82.7 of the Crown Employees (Public Service Conditions of Employment) Reviewed Award 2009 permits, and at all times since 1 October 2012 has continued to permit, employees covered by that Award who continue to receive compensation under the Workers Compensation Act 1987 by reason of having no current work capacity after the completion of a period of 26 weeks to use any accrued but untaken sick leave to make up the difference between the amount of compensation payable under that Act and the employee’s ordinary rate of pay. Sick leave utilised in this way shall be debited against the staff member.

2. For the purposes of order 1, the period of 26 weeks referred to in the order included the aggregate period (whether or no consecutive) in respect of which a weekly payment has been paid or is payable to the employee under the Workers Compensation Act 1987.

3. That order 1 is subject to other limitations to the capacity to use sick leave to top up workers compensation imposed in the Award.

4. Such further and other orders as this Honourable Court deems appropriate.

WORKERS COMPENSATION ACT

Pre-Amendment WC Act

28. Part 2 of the Pre-Amendment WC Act prescribed the liability of employers to pay compensation to workers who received injuries. By s 9, that liability was specified, in general terms, as follows:

9 Liability of employers for injuries received by workers – general

(cf former s 7(1)(a))

(1) A worker who has received an injury (and, in the case of the death of the worker, his or her dependants) shall receive compensation from the worker’s employer in accordance with this Act.

(2) Compensation is payable whether the injury was received by the worker at or away from the worker’s place of employment.

29. Part 3 of the WC Act specified compensation benefits payable when a liability to pay compensation arose. The heading to Div 2 of that Part delineated the subject matter of the Division as the provision of weekly compensation by income support. Section 33 provided:

33 Weekly compensation during total or partial incapacity for work

(cf former s 9 (1))

If total or partial incapacity for work results from an injury, the compensation payable by the employer under this Act to the injured worker shall include a weekly payment during the incapacity.

Note. Chapter 3 of the 1998 Act (Workplace injury management) provides that, if a worker fails unreasonably to comply with a requirement of that Chapter after being requested to do so by an insurer, the worker has no entitlement to weekly payments of compensation for the period that the failure continues.

30. The terms of s 36 of the WC Act immediately before the Amendment Act were as follows:

36 Weekly payment during total incapacity – first 26 weeks

(1) The weekly payment of compensation to an injured worker in respect of any period of total incapacity for work during the first 26 weeks of incapacity shall be the amount of the worker’s current weekly wage rate.

(2) In this section:

current weekly wage rate, in relation to a worker, means the worker’s current weekly wage rate determined from time to time in accordance with section 42.

31. The first period of 26 weeks was defined in s 34 as follows:

34 Definition of first 26 weeks of incapacity

(1) For the purposes of this Division, the first 26 weeks of incapacity, in relation to a worker, is the period of incapacity for work (whether total or partial, or both) not exceeding 26 weeks after the worker becomes entitled to weekly payments of compensation in respect of the incapacity.

(2) A reference in subsection (1) to a period of incapacity for work includes, in the case of separate periods of incapacity resulting from the same injury, a reference to the aggregate of those periods.

(3) For the avoidance of doubt, the first 26 weeks of incapacity does not include any period during which there is no weekly compensation payable in accordance with this Division, whether because of the operation of section 40 or otherwise.

32. Section 37(1) and (1A) of the WC Act provided at that time:

37 Weekly payment during total incapacity—after first 26 weeks

(cf former s 9 (1), (4))

(1) The weekly payment of compensation to an injured worker in respect of any period of total incapacity for work (not being a period during the first 26 weeks of incapacity) shall be:

(a) 90 per cent of the worker’s average weekly earnings, except that:

(i) the payment shall not exceed $235.20 per week,

(ii) in the case of a worker who is over 21 years of age at the time of payment—the payment shall not be less than $187.10 per week, and

(iii) in the case of a worker whose average weekly earnings do not exceed $170 per week—the payment shall be 100 per cent of those earnings or $153, whichever is the lesser amount,

(b) in addition, $62 per week in respect of:

(i) a dependent wife or dependent husband of the worker, or

(ii) if there is no dependent wife or dependent husband at any time during which weekly payments are payable—any one dependent de facto spouse or other family member of the worker…

(1A) Despite subsection (1), for a maximum of 26 weeks the weekly payment of compensation to an injured worker in respect of any period of total incapacity for work (whether the period is during or after, or partly during and partly after, the first 26 weeks of incapacity) is the amount specified in section 36. This subsection applies even if the injury concerned resulted in any period of partial incapacity for work in respect of which the worker received or receives weekly payments of compensation.

33. Section 42(1), (6) and (8), immediately before the Amendment Act, was as follows:

42 Current weekly wage rate

(cf former s 9 (8)–(13))

(1) Subject to this section, a reference in this Division to the current weekly wage rate of a worker, being a worker who is incapacitated for work and who, immediately before being incapacitated:

(a) was remunerated under an award fixing or providing for the fixing of a rate for a weekly or longer period (not being a worker who belongs to a class of workers prescribed by the regulations for the purposes of paragraph (c))—is, at any time during the incapacity, a reference to the rate of remuneration under that award at that time for 1 week in respect of the work being performed by the worker immediately before being incapacitated,

…

(6) In determining a worker’s current weekly wage rate in accordance with subsection (1) (a) or (b) or (4), any amount paid or payable to the worker:

(a) in respect of shift work, overtime or other penalty rates,

(b) under the terms of the worker’s employment in excess of the ordinary rate fixed by any award for the work performed by the worker, or

(c) to cover special expenses incurred by the worker because of the nature of the worker’s employment,

is, except in so far as the regulations otherwise provide, to be disregarded

…

(8) In this section:

appropriate period, for the purposes of the calculation of “average weekly earnings” in relation to a worker, means the period of 12 months or, if the worker has been employed with the employer concerned for less than 12 months at the time of the injury, that lesser period.

average weekly earnings, in relation to a worker, means the average weekly earnings of the worker determined in accordance with section 43 during the appropriate period before whichever of the following times produces the higher average weekly earnings:

(a) the time of the injury concerned,

(b) the time at which the relevant weekly payment of compensation is due,

with the determination under paragraph (b) made on the assumption that the worker had been earning the wage or salary which the worker would probably have been earning if the worker had remained uninjured and continued to be employed in the same or some comparable employment.

award means:

(a) an award in force under the Industrial Arbitration Act 1940 or an award or industrial agreement, within the meaning of the Conciliation and Arbitration Act 1904 of the Commonwealth, that is in force,

(b) an industrial agreement or enterprise agreement in force under the Industrial Arbitration Act 1940 or the Industrial Relations Act 1991,

(c) an agreement made under the Public Service Act 1979 or an agreement with respect to wages or salaries entered into under the provisions of any other Act by an employer constituted by that other Act with any association or organisation representing any group or class of employees, or

(d) an award made by the Coal Industry Tribunal under the Coal Industry Act 1946,

(e) (without limiting the above) includes a State industrial instrument, and includes any such award, industrial agreement or other agreement or instrument as from time to time amended.

prescribed proportion means 80 per cent or, if the regulations prescribe some other percentage for the purposes of this section, that other percentage.

Post-Amendment WC Act

34. The broad structure of the WC Act remained after the passing of the Amendment Act. Parts 2 and 3 continued to deal, respectively, with the liability and compensation befits payable.

35. The Amendment Act repealed ss 36 and 37 of the Pre-Amendment WC Act, with effect from 1 October 2012, and inserted in their place the following:

36 Weekly payments in first entitlement period (first 13 weeks)

(1) The weekly payment of compensation to which an injured worker who has no current work capacity is entitled during the first entitlement period is to be at the rate of:

(a) (AWE × 95%) − D, or

(b) MAX − D,

whichever is the lesser.

(2) The weekly payment of compensation to which an injured worker who has current work capacity is entitled during the first entitlement period is to be at the rate of:

(a) (AWE × 95%) − (E + D), or

(b) MAX − (E + D),

whichever is the lesser.

37 Weekly payments in second entitlement period (weeks 14-130)

(1) The weekly payment of compensation to which an injured worker who has no current work capacity is entitled during the second entitlement period is to be at the rate of:

(a) (AWE × 80%) − D, or

(b) MAX − D,

whichever is the lesser.

(2) The weekly payment of compensation to which an injured worker who has current work capacity and has returned to work for not less than 15 hours per week is entitled during the second entitlement period is to be at the rate of:

(a) (AWE × 95%) − (E + D), or

(b) MAX − (E + D),

whichever is the lesser.

(3) The weekly payment of compensation to which an injured worker who has current work capacity and has returned to work for less than 15 hours per week (or who has not returned to work) is entitled during the second entitlement period is to be at the rate of:

(a) (AWE × 80%) − (E + D), or

(b) MAX − (E + D),

whichever is the lesser.

36. Section 35 provides the formula necessary to apply ss 36 and 37. That provision is in the following terms:

35 Factors to determine rate of weekly payments

(1) For the purposes of the provisions of this Subdivision used to determine the rate of weekly payments payable to an injured worker in respect of a week:

AWE means the worker’s pre-injury average weekly earnings.

D (or a deductible amount) means the sum of the value of each non-pecuniary benefit (if any) that is provided by the employer to a worker in respect of that week (whether or not received by the worker during the relevant period), being a non-pecuniary benefit provided by the employer for the benefit of the worker or a member of the family of the worker.

E means the amount to be taken into account as the worker’s earnings after the injury, calculated as whichever of the following is the greater amount:

(a) the amount the worker is able to earn in suitable employment,

(b) the workers current weekly earnings.

MAX means the maximum weekly compensation amount.

(2) If the determination of an amount for the purpose of determining the rate of weekly payments payable to an injured worker results in an amount that is less than zero, the amount is to be treated as zero.

37. Sections 38, 40 and 41 provided for special requirements to apply to determine whether the payment of weekly compensation continued after 130 weeks of incapacity.

38. Sections 38(1), (2) and (3) provides:

38 Special requirements for continuation of weekly payments after second entitlement period (after week 130)

(1) A worker’s entitlement to compensation in the form of weekly payments under this Part ceases on the expiry of the second entitlement period unless the worker is entitled to compensation after the second entitlement period under this section.

(2) A worker who is assessed by the insurer as having no current work capacity and likely to continue indefinitely to have no current work capacity is entitled to compensation after the second entitlement period.

(3) A worker (other than a worker with high needs) who is assessed by the insurer as having current work capacity is entitled to compensation after the second entitlement period only if:

(a) the worker has applied to the insurer in writing (in the form approved by the Authority) no earlier than 52 weeks before the end of the second entitlement period for continuation of weekly payments after the second entitlement period, and

(b) the worker has returned to work (whether in self-employment or other employment) for a period of not less than 15 hours per week and is in receipt of current weekly earnings (or current weekly earnings together with a deductible amount) of at least $155 per week, and

(c) the worker is assessed by the insurer as being, and as likely to continue indefinitely to be, incapable of undertaking further additional employment or work that would increase the worker’s current weekly earnings.

39. A number of definitions are set out in s 32A. The concept of work capacity is dealt with as follows:

current work capacity, in relation to a worker, means a present inability arising from an injury such that the worker is not able to return to his or her pre-injury employment but is able to return to work in suitable employment.

no current work capacity, in relation to a worker, means a present inability arising from an injury such that the worker is not able to return to work, either in the worker’s pre-injury employment or in suitable employment.

40. The “entitlement periods” were also defined in s 32A as follows:

first entitlement period, in relation to a claim for compensation in the form of weekly payments made by a worker, means an aggregate period not exceeding 13 weeks (whether or not consecutive) in respect of which a weekly payment has been paid or is payable to the worker.

second entitlement period, in relation to a claim for compensation in the form of weekly payments made by a worker, means an aggregate period of 117 weeks (whether or not consecutive) after the expiry of the first entitlement period in respect of which a weekly payment has been paid or is payable to the worker.

Nature of the Changes Brought About by the Amendment Act

41. It is common ground that, in broad terms, the effect of the aforementioned Amendment Act was that, on and from 1 October 2012, an injured worker with no current work capacity received 95% of his or her average weekly earnings or prescribed maximum rate (whichever is the lesser) for the first 13 weeks of incapacity and 80% of his or her average weekly earnings or a prescribed maximum rate (whichever is the lesser) for weeks 14 to 130 of incapacity. Entitlements to weekly compensation after week 130 ceased, subject to certain exceptions.

42. The parties put further submissions delineating the effect of the statutory change. Bearing in mind those submissions, I consider the following represents a relevant summary of the amendments introduced to the WC Act in 2012:

1. An employee at no stage received 100% of their pre-injury average weekly earnings. It was submitted by the respondents that this was consistent with a new legislative policy to encourage workers back to work as early as possibly by giving them a financial incentive to return to work. The applicant did not dispute the effect of the change, in that respect, but submitted that the respondents had overstated the significance of the change. The applicant submitted that, whilst the Amendment Act altered the timing of adjustments to weekly compensation payments, the provisions under the Pre-Amendment WC Act ultimately provided for weekly compensation payments less than the ordinary earnings of an employee after 26 weeks of incapacity and that the awards nonetheless incorporated workers compensation top up provisions specifically to allow employees to use accrued sick leave to top up weekly compensation payments. That much may be accepted but it does not alter the correctness of the respondents’ submission as to the effect of the change to the WC Act.

2. There is no period of 26 weeks referred to in the Post-Amendment WC Act. The reference in s 36 to the “first entitlement period” is a reference to the first 13 weeks. The reference in s 37 to the “second entitlement period” is a reference to a period of 116 weeks (being weeks 14 to 130 inclusive).

3. For the first 13 weeks of incapacity (whether a worker was totally or partially incapacitated) the worker received 95% of the worker’s pre-injury weekly earnings (which included overtime and shift work payments). The weekly payments in the second entitlement period varied and may include a payment of 80% or 95% of the worker’s pre-injury average weekly earnings. The quantum of compensation under the Pre-Amendment WC Act paid from 26 weeks, thereafter, was different to the amount paid for the same period under the Post-Amendment WC Act so the amount of sick leave that would be applied to top up would be different. The respondents submitted, without demur from the applicant, that from week 27 onwards the amount of top up payment was less but the period it applies was, therefore, longer.

4. The entitlement to workers compensation after 130 weeks ceased, save for the special circumstances provisions under s 38. One such circumstance occurred if a worker was assessed “as having no current work capacity and likely to continue indefinitely to have no current work capacity”: s 38(2). In that case, the worker was entitled to weekly compensation and, accordingly, paid 80% of the worker’s pre-injury average weekly earnings or the maximum statutory rate (whichever is the lesser): s 38(6). Further, pursuant to s 38(3), a worker continues to receive compensation after 130 weeks upon the worker being assessed as having “current work capacity” if three conditions are met one of which is that the worker has returned to work for at least 15 hours per week and was in receipt of current weekly earning of a certain amount per week. In that case compensation was assessed under s 38(7).

5. In any event, weekly compensation will not be payable to a worker after 5 years of weekly payments (with an exception of injured workers with more than 20% whole person impairment): s 39.

6. Those workers who are partially incapacitated are now addressed in s 36 and are not treated differently to totally incapacitated workers for the first 13 weeks. There is a higher rate of compensation thereafter for those that work a minimum 15 hours per week: s 37(2).

7. Calculation of compensation is based on a worker’s “pre-injury average weekly earnings” which is not calculated in the same way as the “current weekly wage rate” under the Pre-Amendment WC Act. The calculation differs depending on the period of time from the date of injury and the employment of the worker: see s 44C of the Post-Amendment WC Act and s 42 of the Pre-Amendment WC Act.

1. The applicant also submitted, correctly in my view, that:

1. The WC Act continued after the Amendment Act to provide an entitlement to the payment of weekly compensation in circumstances of an employee who is totally incapacitated;

2. The amount of weekly compensation payments continued to be determined by reference to the period of incapacity being the aggregate period the worker had been entitled to weekly payments in respect of incapacity.

Transitional Arrangements

43. I return to the question as to whether the top up provisions have any operation after 1 October 2012.

44. Both parties accepted that, for a particular class of employees under Pt 3 Div 2 of the WC Act, the Pre-Amendment WC Act top up payments would continue pursuant to Sch 6 Pt 19H Div 2 cl 6 of the WC Act.

45. It is appropriate, in this respect, to refer to Div 1 cl 3 and Div 2 cl 6 which are in the following terms:

3 Application of amendments generally

(1)  Except as provided by this Part or the regulations, an amendment made by the 2012 amending Act extends to:

(a) an injury received before the commencement of the amendment, and

(b) a claim for compensation made before the commencement of the amendment, and

(c) proceedings pending in the Commission or a court immediately before the commencement of the amendment.

(2) An amendment made by the 2012 amending Act does not apply to compensation paid or payable in respect of any period before the commencement of the amendment, except as otherwise provided by this Part.

…

6   Application of weekly payments amendments to existing claimants

An existing recipient of weekly payments remains entitled to compensation under Division 2 of Part 3 of the 1987 Act as if the weekly payments amendments had not been made, but only until the weekly payments amendments apply to the compensation payable to the person as provided by this Division.

46. The respondents made the following submission, in respect of this class of employees, as follows:

[11] It is not in dispute that employees who met the qualifying requirement under s 36 of the WC Act as it was before the October 2012 amendments were entitled to obtain the benefit of the relevant Award top up provisions before that date and continued to be able to obtain the benefit of the provisions after the October 2012 amendments. In other words, it is not in dispute that clause 82.7 of the Conditions Award (and the same clauses in the other Awards) had the effect asserted by the proposed declaration in respect of employees who had, prior to 1 October 2012, completed the period of 26 weeks referred to in s 36 of the WC Act or who had commenced the period referred to in s 36 before 1 October 2012 and who, as a consequence of transitional provisions, continued to obtain compensation after that date pursuant to s 36 as it was prior to the amendments and who then subsequently completed the 26 week period referred to in that section.

47. The applicant submitted that the potential application of the preceding provisions would be limited to a maximum period of 15 months after 1 October 2012. That contention was advanced on the following bases:

1. The applicant submitted that the continuance of Pre-Amendment WC Act provisions was governed by Sch 6 Pt 19H Div 2 cll 3, 6, 8 and 9 of the WC Act. There was no dispute as to the class of employees caught by the transitional provisions as described by the respondents at [19] above and in the immediately preceding paragraph of this judgment.

2. Pursuant to cl 9(1) of the Post-Amendment WC Act, the weekly payment amendments apply 3 months after a work capacity assessment.

3. A work capacity assessment is to be conducted no later than 12 months (or such longer period as may be prescribed by the regulations) after the commencement of the weekly payment amendments: see cl 8 of the Post-Amendment WC Act.

4. The limit of the operation of the award after 1 October 2012 was 15 months.

48. In my view, the submissions of the applicant (incorporating, as they do, the class of employees (referred to in [46] and [47(1)] above) to whom the transitional provisions of the Amendment Act apply) may be accepted, save for the following:

1. The applicant’s limitation of 15 months is predicated on the basis that the weekly payment amendments apply upon the expiration of a period of 3 months after a work capacity assessment, pursuant to Sch 6 Pt 19H Div 2 cl 9(1), and that such a work capacity assessment must be conducted no later than 12 months after the commencement of the weekly payment amendments on 1 October 2012. In this respect, the applicant neglected to consider the relevance of the Workers Compensation Regulation 2016 (NSW), which was given effect by virtue of Sch 6 Pt 19H Div 2 cl 5(4) of the Post-Amendment WC Act. The operation of the Workers Compensation Regulation 2016 is such that the weekly payment amendments do not apply to the compensation payable in respect of injury until 1 January 2013 if a claim was made before 1 October 2012. Thus, this would have the effect of extending the period for an additional 3 months.

2. Notwithstanding what seems to be an 18 month limitation (arising from the analysis of [47(1)] above), the provisions of Sch 8 Pt 1 cl 17 of the Workers Compensation Regulation 2016 contemplate the savings provisions operating, in some circumstances, to 1 September 2015. This provision appears to concern seriously injured workers who, pursuant to Sch 6 Pt 19H Div 2 cl 8(3) of the Post-Amendment WC Act, may not have had a work capacity assessment conducted. The weekly payment amendments, therefore, would not apply within the time frame specified in [47(1)] (although the ultimate date was that specified in 2015). No submissions were addressed to this question and as nothing in this matter would seem to turn on its resolution I will refrain from expressing any final view.

PRINCIPLES OF AWARD INTERPRETATION

49. The principles applicable to the interpretation of industrial awards were recently discussed by McColl JA (with whom Leeming and Simpson JJA agreed) in State of New South Wales v Stockwell [2017] NSWCA 30 (“Stockwell”). Her Honour stated (at [68]):

[68] When construing an industrial agreement such as the 2006 Award, in particular the primary requirement and the proviso, the Court must have regard to the language of the particular agreement, understood in the light of its industrial context and purpose and its operation as a whole as well as the legislative background against which it was made and in which it was to operate.

50. In this matter the respondents placed reliance upon the distillation of principles by the Industrial Court in Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales v Secretary of the Treasury (2014) 87 NSWLR 41; [2014] NSWIRComm 23 (“Secretary of the Treasury”) (at [115]) (see also State Transit Authority of New South Wales v Australian Rail, Tram and Bus Industry Union, New South Wales Branch, Bus and Tram Division (2014) 247 IR 129; [2014] NSWIRComm 41 at [26]-[31]). No demur to those principles was expressed by the applicant; although emphasis was placed on authorities to the effect that award should receive a generous construction and authorities concerning the interpretation of commercial contracts. I have, in that event, applied the principles of award construction, as distilled in Secretary of the Treasury, in this matter.

51. However, it will be useful to return to some earlier passages from the Secretary of the Treasury which underpinned the formulation of aforementioned distilled principles. Those passages are found at [102]-[108] of that judgment and are extracted below:

[102] In George A. Bond & Co Ltd (in liq) v McKenzie at 503-504, Street J, then a judge of the Industrial Commission of New South Wales, succinctly stated the principles applicable to the interpretation of awards which have been long applied in the industrial jurisprudence of this State as follows:

Now speaking generally, awards are to be interpreted as any other enactment is interpreted. They lay down the law affecting employers and employees in their relations as such, and they have to be obeyed to the same extent as any other statutory enactment. But at the same time, it must be remembered that awards are made for the various industries in the light of the customs and working conditions of each industry, and they frequently result, as this award in fact did, from an agreement between parties, couched in terms intelligible to themselves but often framed without that careful attention to form and draughtsmanship which one expects to find in an Act of Parliament. I think, therefore, in construing an award one must always be careful to avoid a too literal adherence to the strict technical meaning of words, and must view the matter broadly, and after giving consideration and weight to every part of the award, endeavour to give it a meaning consistent with the general intention of the parties to be gathered from the whole award.

(See also Perisher Blue Pty Ltd v Australian Workers' Union (1999) 91 IR 274 at 283; Transport Workers' Union (NSW Branch) v Walker Civil Engineering (1999) 91 IR 153 at 166; Health and Research Employees' Association of New South Wales v Baptist Community Services NSW and ACT [2002] NSWIRComm 32; (2002) 122 IR 178 at [61]; Health and Research Employees Association of New South Wales, Re Dispute with Northern Rivers Health Service re Payment to Part-time Employees [2004] NSWIRComm 10; (2004) 135 IR 132 at [9]; Kingmill at [67]; Director of Public Employment (by her Agent the Commissioner of New South Wales Fire Brigades) v New South Wales Fire Brigades Employees' Union (2008) 180 IR 170; [2008] NSWIRComm 158 at [38], [39] and [59] ('NSW Fire Brigades') and Re Hospital Employees Administrative and Clerical (State) Award (1982) 2 IR 123 at 125.)

[103] The expression 'interpreted as any other enactment' in this passage is plainly a reference to statutory interpretation and has consistently been approached in that fashion: see NSW Fire Brigade at [38] and [39], such that Street J considered the principles of statutory interpretation should be applied to the interpretation of industrial instruments with specific refinements. (These principles have been applied in other jurisdictions, see, for example, City of Wanneroo at [107] with respect to the interpretation of awards and Australasian Meat Industry Employees Union (WA Branch) v Woolworths Ltd [2007] FCAFC 201; (2007) 164 FCR 420; (2007) 244 ALR 658; (2007) 170 IR 403 at 21 in the context of construing industrial agreements. Ultimately, the principles have been adopted by the High Court of Australia, albeit in the context of industrial agreements: see, for example, Amcor at [66].)

[104] These principles were given effect in the following two passages from the judgment of French J (as he then was) in City of Wanneroo at [53] and [57], as follows:

[53] The construction of an award, like that of a statute, begins with a consideration of the ordinary meaning of its words. As with the task of statutory construction regard must be paid to the context and purpose of the provision or expression being construed. Context may appear from the text of the instrument taken as a whole, its arrangement and the place in it of the provision under construction. It is not confined to the words of the relevant Act or instrument surrounding the expression to be construed. It may extend to "... the entire document of which it is a part or to other documents with which there is an association". It may also include "... ideas that gave rise to an expression in a document from which it has been taken" - Short v FW Hercus Pty Ltd (1993) 40 FCR 511 at 518; 46 IR 128 at 134 (Burchett J);Australian Municipal, Administrative, Clerical and Services Union v Treasurer of Commonwealth (1998) 82 FCR 175; 80 IR 345 (Marshall J).

...

[57] It is of course necessary, in the construction of an award, to remember, as a contextual consideration, that it is an award under consideration. Its words must not be interpreted in a vacuum divorced from industrial realities - City of Wanneroo v Holmes (1989) 30 IR 362 at 378-379 and cases there cited. There is a long tradition of generous construction over a strictly literal approach where industrial awards are concerned – see eg George A Bond & Co Ltd (in liq) v McKenzie [1929] AR (NSW) 498 at 503-504 (Street J). It may be that this means no more than that courts and tribunals will not make too much of infelicitous expression in the drafting of an award nor be astute to discern absurdity or illogicality or apparent inconsistencies.

[105] The principles stated in City of Wanneroo stemmed from a consideration that an award made under the Workplace Relations Act 1996 (Cth) had the force of law of the Commonwealth (see at [51]) and attracted the operation of that Act for the purposes of interpretation by virtue of s 46 of the Acts Interpretation Act 1901 (Cth). French J thereby proceeded to give effect to the provisions of ss 15AA and 15AB of the Acts Interpretation Act.

[106] In NSW Fire Brigades, the Full Bench stated that the Interpretation Act 1987 (NSW), by virtue of s 3(1) of that Act, applied to the interpretation of awards and thereby "entrenched" the long held principles stated in George A Bond & Co (see at [38]). Subject, to one reservation, I agree, with respect, with that conclusion.

[107] Section 5 of the Interpretation Act provides, inter alia, that that Act applies to 'instruments'. That word is defined in s 3(1) to mean "an instrument (including a statutory rule or an environmental planning instrument) made under an Act...". There would seem to be little doubt that an award is an instrument (see City of Wanneroo at [53]). Further, I consider that an award is an instrument made under an Act. Section 10 of the Act provides that the Commission "may make an award in accordance with this Act". Section 11 makes the award binding on all parties and an award, when made, is given the force of law by being made enforceable under the Act (see s 357): see Australian Communication Exchange Ltd v Deputy Commissioner of Taxation [2003] HCA 55; (2003) 201 ALR 271 at [61] and footnote (27).

[108] There may be some doubt, however, as to whether s 33 of the Interpretation Act, has application with respect to the interpretation of awards.

52. Paragraph [107] of the above extract was followed in Stockwell (at [69]). That reasoning was adopted by the parties in these proceedings as the basis upon which the applicant was entitled to place reliance upon s 68(1) and (3) of the Interpretation Act, namely, that an award is an instrument for the purposes of that Act.

53. I also note the observations of McColl JA in Stockwell regarding the application of s 33 of the Interpretation Act, to award interpretation, as follows (at [71]):

[71] The application of s 33 was not debated by the parties. I assume for present purposes that s 33 does not apply. Nevertheless, that provision is a re-statement of the common law mischief rule, which is “a valid approach to statutory interpretation so as to ensure that the purpose of the legislature is achieved.” It is proper to seek to give the 2006 Award a meaning which advances its purpose, so far as that can be done consistently with the text.

54. As the above discussion disclosed, the principles of award interpretation bear a relationship to the principles of statutory interpretation, albeit with recognition of the circumstances in which industrial instruments are brought into existence. I propose then to briefly interpose a discussion of those latter principles.

55. I will commence by reference to the judgment of Bathurst CJ in Rail Corp (NSW) v Brown (2012) 82 NSWLR 318; (2012) 219 IR 67 (with whom Beazley and Basten JJA agreed) at [39]-[40] in which his Honour stated as follows:

[39] As has recently been pointed out by the High Court on a number of occasions, the process of construction begins with the construction of the ordinary and grammatical meaning of the words in question, having regard to their context and legislative purpose: Australian Education Union v Department of Education and Children’s Services (2012) 86 ALJR 217 at [26]; Roadshow Films Pty Ltd v iiNet Ltd (2012) 86 ALJR 494 at [22]; Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at [41], [45]-[48].

[40] Further, although the legislative purpose in enacting the provision and the mischief to be remedied are factors which are to be taken into account in construing the provision in question (see the cases cited above; CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384 at 408; Interpretation Act 1987 (NSW), ss 33, 34) it is not for a court to construe its own idea of a desirable policy, impute that to the legislature and then characterise it as a statutory purpose: Australian Education Union at [26] and the cases there cited; Alcan at [46].

56. I refer also to the principles of statutory construction outlined by French CJ and Hayne J (with whom Kiefel J agreed in this respect) in Certain Lloyd's Underwriters Subscribing to Contract No IH00AAQS v Cross (2012) 248 CLR 378; [2012] HCA 56 at [23]-[26] as follows:

[23] It is as well to begin consideration of this issue by re-stating some basic principles. It is convenient to do that by reference to the reasons of the plurality in Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue:

“This Court has stated on many occasions that the task of statutory construction must begin with a consideration of the text itself. Historical considerations and extrinsic materials cannot be relied on to displace the clear meaning of the text. The language which has actually been employed in the text of legislation is the surest guide to legislative intention. The meaning of the text may require consideration of the context, which includes the general purpose and policy of a provision, in particular the mischief it is seeking to remedy.”

[24] The context and purpose of a provision are important to its proper construction because, as the plurality said in Project Blue Sky Inc v Australian Broadcasting Authority, “[t]he primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute” (emphasis added). That is, statutory construction requires deciding what is the legal meaning of the relevant provision “by reference to the language of the instrument viewed as a whole”, and “the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed”.

[25] Determination of the purpose of a statute or of particular provisions in a statute may be based upon an express statement of purpose in the statute itself, inference from its text and structure and, where appropriate, reference to extrinsic materials. The purpose of a statute resides in its text and structure. Determination of a statutory purpose neither permits nor requires some search for what those who promoted or passed the legislation may have had in mind when it was enacted…

[26] A second and not unrelated danger that must be avoided in identifying a statute's purpose is the making of some a priori assumption about its purpose…

[Footnotes omitted.]

57. I will resume the discussion of the principles of statutory construction (at [74]-[79] of this judgment), and its relationship to the interpretation of awards, in the context of a consideration of submissions by the applicant; in which reliance was placed upon principles associated with construing commercial contracts.

58. Returning to Secretary of the Treasury, reference should also be made to further passages of that judgment which concerned the following: first, recourse to the circumstances surrounding the making of the award, for the purposes of construction, and secondly, the aforementioned generosity of approach to construction in such a case.

57. In the first case, I refer to [128] and [129] of Secretary of the Treasury, which was as follows:

[128] In order to ascertain the meaning of a provision of an award which is susceptible to more than one meaning, even after the consideration of the immediate context of a provision, recourse may be had to the circumstances surrounding the making of an award in order to see what the circumstances were with reference to which the words of the award provision were used. Within those parameters, reference may be had to a mutually known factual matrix present at the making of the award, including the conduct of prior negotiations, the forming of an agreement and, more generally, the history of the provision. Evidence is not admissible to ascertain the subjective intentions of the parties. Nor is evidence of their conduct subsequent to the commencement of the instrument admissible.

[129] Some further short reference should be given to the consideration of the history of a provision of an award. An examination of the actual history of the provisions of an award, the subject of an application for declaratory relief, may form part of the consideration of context.

(Reliance, in this respect, was placed upon the judgment of Short v FW Hercus Pty Ltd (1993) 40 FCR 511 at 517-518 (per Burchett J with whom Drummond J agreed)).

60. As to the second reference, a liberal approach to the construction of awards, the applicant placed reliance upon three judgments (all of which were addressed in Secretary of the Treasury): Amcor Ltd v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241; [2005] HCA 10 at [94]-[96] (per Kirby J), in Kucks v CSR Ltd (1996) 66 IR 182 at 184 (per Madgwick J) and City of Wanneroo v Australian Municipal, Administrative, Clerical And Services Union (2006) 153 IR 426; [2006] FCA 813 at [57] (per French J).

61. I propose to adopt the following passages from the Secretary of the Treasury, bearing upon the notion of a liberal construction of awards (at [142]-[144]):

[142] Of course, a difference in the relative bargaining power of the parties is not relevant to the present matter but the requirement to have regard to all the circumstances of the case in which the actual words used are in harmony with the jurisprudence which I have reviewed above. In short, in the construction of an award, this methodology requires the Court to utilise a broad approach to the relevant words in their context, particularly their industrial context (and this may include relevant permissible extrinsic evidence but must disregard impermissible extrinsic evidence) in order to discern the meaning of those words which the drafters are properly taken to have intended.

[143] The adoption of these principles will result, in my view, in avoidance, in the construction of awards, of a strict but unintended technical meaning being attributed to the particular words of an award or too much attention being given to mere infelicitous expression or inconsistencies. The Court should not strive for the discernment of an absurdity. The Court should endeavour to give a provision of an award a meaning consistent with the intention of the parties gathered from the words of the provision and from the whole award, having regard to the industry and industrial relations environment in which the award came to be made. As Kirby J put it, the construction should be one which contributes to a sensible industrial outcome, provided, as discussed below (and earlier in relation to the extrapolation of principle), such an interpretation may reasonably be available from the language used in the provision (that is, from the text of an award).

[144] Ultimately, the adoption of such an approach to the construction of awards has limits. As I have mentioned, the principles of award interpretation cannot lead to an attempt to construe the terms of an award according to the subjective intention of the parties or result in an unreasonable or unnatural construction being placed on the words of an award. Attention must be fixed upon the ordinary meaning of the words used when read in context. As French J stated in City of Wanneroo at [57]:

...while fractured and illogical prose may be met by a generous and liberal approach to construction, I repeat what I said in City of Wanneroo v Holmes (at 380):

Awards, whether made by consent or otherwise, should make sense according to the basic conventions of the English language.

62. As mentioned, the applicant submitted in support of the further contention, that guidance as to the construction of industrial instruments may be obtained by reference to principles which apply to the construction of commercial contracts.

63. Reliance was placed on a number of authorities, in that respect, commencing with the general observations of Kirby J as to the construction of commercial agreements in Pan Foods Company Importers & Distributers Pty Ltd v Australia and New Zealand Banking Group Ltd (2000) 170 ALR 579 (“Pan Foods”) at [24].

64. In written submissions, the applicant submitted that:

[42] A commercial contract will be interpreted so as to avoid the conclusion that a provision is void by reason of uncertainty by giving effect to the apparent intentions of the parties. …

[43] The courts should be "astute to adopt a construction which will preserve the validity of the contract", and where parties to a commercial dealing have acted in the belief that they had a binding contract, "the courts are willing to imply terms, where that is possible, to enable the contract to be carried out." [Meehan v Jones [1982] HCA 52; (1982) 149 CLR 572 at 589; Helmos Enterprises Pty Ltd v Jaylor Pty Ltd [2005] NSWCA 235 at [97]-[111]]. The first imperative must be that the law "ought to uphold rather than destroy apparent contracts." [Associated Japanese Bank (International) Ltd v Credit du Nord SA [1989] 1 WLR 255 at 268; Mainteck Services Pty Ltd v Stein Heurtey SA [2014] NSWCA 184; (2014) 89 NSWLR 633 at [55]-[56]].

65. In reply, the respondents submitted:

[60] The Applicant's submissions at paragraphs [25]-[27] seek to place reliance on authority as to the construction of commercial contracts, and in particular on the principle that a contract will be interpreted so as to avoid a conclusion that a provision is void by reason of uncertainty by giving effect to the apparent intention of the parties. As to that:

a. The principles of interpretation of commercial contracts, involving agreement between parties, are not readily applied to instruments made by a tribunal;

b. The well settled principles of award interpretation do not incorporate reference to principles of interpretation drawn from interpretation of commercial contracts;

c. Where the Interpretation Act applies, the Court applies that rather than principles that derive from interpretation of contracts;

d. The interpretation for which the Respondents contend does not render the top up provisions void; they continue to have the effect set out at [11] above; and

e. In any event, the clear intent of the top up provisions is to provide a specific and limited entitlement, namely one limited to those totally incapacitated, to top up from the amount that was to be paid as compensation pursuant to the WC Act as it was prior to the Amendment Act. The precise words used do not allow for a conclusion that the intent of the tribunal was to create a general entitlement to access sick leave to top up from any level of compensation by any employee who is entitled to claim compensation.

66. The general observations made by Kirby J, in that context, are clearly consistent with the aforementioned principles to the interpretation of industrial instruments. His Honour referred to a practical approach to construction giving effect to the evident purpose of the instrument and the need to avoid the achievement of that purpose by an excessively narrow and artificial restricted construction.

67. In Pan Foods, Kirby J was concerned to avoid the importation into the construction of the subject contract of the strict approach “[which had] produced such artificialities in the case of commercial agreements with compensated sureties” (at [23]). For example, in that matter it had been argued that, notwithstanding that a bank officer had attended the plaintiff’s premises to serve a notice of demand himself, the notice was not “given” to the plaintiff (in accordance with the terms of the contract) because the notice did not, inter alia, contain the authorised officer’s name or signature, even though the general conditions of the contract required no such conditions.

68. However, caution should be exercised in applying the principles associated with the construction of commercial contracts to the construction of industrial instruments for the following reasons:

1. Even if it was assumed that the same approach should be adopted to the construction of the employment contracts, upon which an industrial award operates, as that applying to arm’s length commercial contracts (a proposition about which considerable doubt may be expressed: see Autoclenz Ltd v Belcher [2011] 4 All ER 745; [2011] UKSC 41 at [33]-[35] (per Lord Clarke SCJ, with whom Lord Hope DP, Lord Walker, Lord Collins and Lord Wilson SCJJ agreed), an award has a distinctly different legal character to a commercial contract, particularly with respect to principles associated with the formation of a contract (such as mutuality of assent and offer and acceptance), privity of contract and construing the terms of a contract). Section 12 of the IR Act makes the award binding upon all employees and employers to which it relates, whether or not they were a party to the making of the award (see Secretary of the Treasury at [12]). Further, there is no necessity for persons who might be affected by a proposed award to be made parties to the proceedings in order for an industrial Tribunal to have jurisdiction to make an award: Notification under section 130 by the New South Wales Teachers Federation of a dispute with Department of Education and Training re changes to TAFE teacher education programs [2008] NSWIRComm 117 at [20].

2. An award does not require an understanding of the parties or a meeting of the minds of those persons bound by it; given it is a common rule it is impossible to have an understanding between all the participants bound by the award: Downe v Sydney West Area Health Service (No 2) (2008) 71 NSWLR 633; [2008] NSWSC 159 at [252] (per Rothman J).

3. The terms of an industrial award will not necessarily reflect conditions drafted by parties in making an agreement as the terms may represent the outcome of the conciliation processes within the purview of the IR Act in which the Commission, in addition to assisting the parties to reach agreement, may influence both the form of the award provision and its substance (by reference to minimum statutory requirements and relevant principles).

4. An award may be made, repealed or varied with or without the consent of a party: see ss 17(1), 17(3)(c) and 17(3)(d). Employees to awards have no right to make an application to make, vary or rescind an award (s 11(2)) and, generally speaking, have no right to be heard in a proceeding regarding the same: Re Operational Ambulance Officers (State) Award (2011) 207 IR 272; [2011] NSWIRComm 61 at [44], [51] and [58].

5. In all such cases (consentual or otherwise) the Commission may impact, itself, upon the terms of the award. The Commission must have regard to whether, in the making of an award the award meets the statutory criteria in s 10 (the award sets fair and reasonable conditions of employment for employees) and s 146(2) (requiring the Commission to take into account the public interest in the exercise of functions including the state of the economy, and the likely effect of its decisions on the economy).

6. It may be doubted that notions such as “commercial purposes” referred to by Kirby J in Pan Foods or Leeming JA in Mainteck Services Pty Ltd v Stein Heurtey SA (2015) 87 NSWLR 633; [2014] NSWCA 184 (“Mainteck Services”) at [71], the adoption of a “commercially realistic approach” to the enforcement of contracts referred to in Helmos Enterprises Pty Ltd v Jaylor Pty Ltd [2005] NSWCA 235 (“Helmos Enterprises”) at [98] (per Young CJ at EQ, with whom Hodgson JA and Stein AJA agreed) or the objective reality by which a “lengthy contract is bought into existence to record a bargain”: Mainteck Services at [53], may be readily equated to notions such as an industrial purpose, an industrial reality or an industrial relations environment referred to in the aforementioned authorities in which it is opined that a liberal approach should be adopted to the construction of awards.

69. These considerations must be borne in mind when approaching the submission advanced by applicant that (based upon principles relating to the construction of commercial contracts) the Court should be “astute to adopt a construction which will preserve the validity of the contract and where the parties to a commercial dealing have acted in the belief that they had a binding contract, the Courts are willing to imply terms, where that is possible, to enable to contracts to be carried out” (relying upon Meehan v Jones (1982) 149 CLR 572; [1982] HCA 52 (“Meehan”) at 589 and Helmos Enterprises at [97]-[111]). It was also submitted that the first imperative is that the law “ought to uphold rather than destroy apparent contracts” (Mainteck Services at [55]-[56]).

70. Each of the decisions in Meehan, Helmos Enterprises and Mainteck Services concerned a question as to whether there was an intention to create contractual relations. Mainteck concerned the quantum as to whether a contract had formed, where the main contract permitted a final design, which might vary from those in existence at the time of the making of the contract thereby varying the obligations which Mainteck was promising to perform. Helmos Enterprises concerned whether a contract was void for uncertainty or incompleteness, as did the relevant passage in Meehan (see [589] per Mason J).

71. None of those issues arise in the present matter as there was no challenge to the validity of the award or the top up provisions. If such challenge had been brought it would have given rise to different issues than those concerned with the law of contract. This is not a matter where there exists any question as to the binding effect of the award upon the parties to it or the employees regulated by it, but rather, whether an award provision continues to have effect, by its terms, save for a limited exception to the subject employees. The award exists independently of individual employment contracts and may be varied or rescinded upon considerations entirely outside the immediate interests of the parties to those contracts.

72. The applicant submitted that courts have been willing to imply terms, where possible, in commercial contracts in order to enable such contracts to be carried out. That proposition may be accepted but the implications of that principle, in the present matter, were not made clear. Presumably, it was intended to convey that the Court may imply, as part of the construction of the top up provision, terms that are consistent with the aforementioned principles for the construction of commercial contracts in order for the provision to wholly continue to operate, notwithstanding the amendments to WC Act in 2012. Again just how those principles may be translated into the construction of instruments created under statute, such as an award, was not fully explained.

73. In any event, there are a number of difficulties, in my view, with the applicant’s contention in this respect for the following reasons:

1. Having regard to the aforementioned line of authorities, with respect to the proper approach to award construction, the applicable principles as to the implication of terms is to be found in the realm of statutory construction as will be discussed below.

2. As will be seen below, in my view, the submissions of the applicant, in its further contention, impermissibly construed the words of the top up provision, as having ambulatory operation with too great a variance from the text of the provision such that the top up provision would continue to operate by reference to the Post-Amendment WC Act provisions, ss 36, 37 and 38, albeit constrained by the limitations the Pre-Amendment WC Act (a 26 week period for persons suffering total incapacity). No different conclusion follows from a purposive approach.

74. The proper approach to implying terms in statutes was discussed in the judgment of the High Court in Taylor v The Owners – Strata Plan No 11564 (2014) 253 CLR 531; [2014] HCA 9 (“Taylor”) and by the New South Wales Court of Criminal Appeal in two judgments: R v Young (1999) 46 NSWLR 681; [1999] NSWCCA 166 (per Spigelman CJ, with whom Abadee and Barr JJ agreed) and R v PLV (2001) 51 NSWLR 736; [2001] NSWCCA 282 (per Spigelman CJ, with whom Simpson J and Smart AJ agreed).

75. The relevant passage of the majority (French CJ, Crennan and Bell JJ) in Taylor is found at [35]-[40] as follows:

[35] In Young Spigelman CJ suggested that the authorities do not warrant the court supplying words in a statute that have been “omitted” by inadvertence per se. Construing the words actually used by the legislature in “their total context”, Spigelman CJ suggested that the process of construction admits of reading down of general words or giving the words used an ambulatory operation. His Honour cited Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation as an instance of the former and Bermingham v Corrective Services Commission (NSW) as an instance of the latter. In R v PLV his Honour expanded on his analysis in Young, observing:

“The authorities which have expressed the process of construction in terms of ‘introducing’ words to an Act or ‘adding’ words have all, so far as I have been able to determine, been concerned to confine the sphere of operation of a statute more narrowly than the full scope of the dictionary definition of the words would suggest. I am unaware of any authority in which a court has ‘introduced’ words to or ‘deleted’ words from an Act, with the effect of expanding the sphere of operation that could be given to the words actually used … There are many cases in which words have been read down. I know of no case in which words have been read up.” (Emphasis in original).

[36] In Leys the Victorian Court of Appeal was critical of Spigelman CJ’s characterisation of purposive construction as a process of construing “the words actually used” (emphasis in original). Their Honours said that the process requires the court to determine whether the modified construction is reasonably open in light of the statutory scheme and against a background of the satisfaction of Lord Diplock’s three conditions. Their Honours questioned the utility of the distinction between “reading up” and “reading down” and rejected the proposition that a purposive construction may not result in an expanded operation of a provision.

[37] Consistently with this Court’s rejection of the adoption of rigid rules in statutory construction, it should not be accepted that purposive construction may never allow of reading a provision as if it contained additional words (or omitted words) with the effect of expanding its field of operation. As the review of the authorities in Leys demonstrates, it is possible to point to decisions in which courts have adopted a purposive construction having that effect. And as their Honours observed by reference to the legislation considered in Carr v Western Australia, the question of whether a construction “reads up” a provision, giving it an extended operation, or “reads down” a provision, confining its operation, may be moot.

[38] The question whether the court is justified in reading a statutory provision as if it contained additional words or omitted words involves a judgment of matters of degree. That judgment is readily answered in favour of addition or omission in the case of simple, grammatical, drafting errors which if uncorrected would defeat the object of the provision. It is answered against a construction that fills “gaps disclosed in legislation” or makes an insertion which is “too big, or too much at variance with the language in fact used by the legislature”.

Contrary Intention

159. Section 5(2) of the Interpretation Act relevantly provides that the Interpretation Act will apply to the Conditions Award except insofar as the contrary intention appears “in this Act or in… [the award]”. Thus, s 68(3) will not apply to the top up provision if a contrary intention appears in that provision.

160. Thus, a contrary legal intention must relevantly be established from the text of the top up provision. That contrary intention need not be stated expressly and may appear from the scope, nature and subject matter of the award: Forsyth at [28]. Nonetheless, the Court should be slow to find a contrary intention with respect to the operation of s 68 of the Interpretation Act: Forsyth at [29].

161. As to the principles applicable to the ascertainment of contrary intention both parties relied upon the following passages from the judgement of Handley JA in Lister (at [24]-[27]):

[24] The Interpretation Act and cognate legislation elsewhere has long provided that words in the singular include the plural unless the contrary intention appears. The operation of this provision in the Interpretation Act 1899 (NSW) was considered in Blue Metal Industries Ltd v Dilley [1970] AC 827. The Companies Act 1961 authorised the compulsory acquisition of the remaining shares in a company if the holders of 90% accepted a takeover offer. A takeover offer made by two companies acting jointly was accepted by the holders of over 90% of the shares in the target company and the offerors wished to compulsorily acquire the balance. The Companies Act did not apply in terms to takeover offers made by two or more companies acting jointly but the offerors argued that the Interpretation Act authorised a plural construction. Lord Morris, delivering the judgment of the Board said at 848:

“The Interpretation Act is a drafting convenience. It is not to be expected that it would be used … to change the character of legislation. Acquisition of shares by two or more companies is not merely the plural of acquisition by one. It is quite a different kind of acquisition with different consequences. It would pre-suppose a different legislative policy.”

[25] Earlier Lord Morris had approved the following passage from the judgment of Lord Pearce in Sin Poh Amalgamated (HK) Ltd v Attorney General of Hong Kong [1965] 1 WLR 62, 67:

“The Interpretation Ordinance was intended to avoid multiplicity of verbiage and to make the plural cover the singular except in such cases as one finds in the context of the legislation reason to suppose that the legislature, if offered such amendment to the Bill, would have rejected it.”

[26] These principles are relevant here because s 68(3) applies to s 42(8) “except insofar as the contrary intention appears”. Any contrary intention must be found in s 42(8) as enacted in 1987, and the question posed by Lord Pearce is whether there are reasons to suppose that the Parliament, if offered an amendment to s 42(8) at any time after the 1904 Commonwealth Act had been repealed would have rejected it. Using the language of Lord Morris one asks whether an amendment to s 42(8) to insert a reference to the 1988 or 1996 Acts would change the character of the section to reflect a different legislative policy.

[27] In my judgment a construction of s 42(8), with the aid of s 68(3), to include references to the 1988 and now the 1996 Commonwealth Acts would not involve any change in the legislative policy apparent in the section and there is no reason to suppose that the Parliament would have rejected such an amendment. The appeal therefore succeeds on this point.

162. My reasons for the finding of a contrary intention for the purposes of s 5(2) of the Interpretation Act may be briefly stated.

163. In Lister, Handley JA posed two related tests or principles for the determination of contrary intention. By application to the circumstances of the present matter, the first was to use the language of Lord Morris in Blue Metal Industries Ltd v Dilley (1969) 117 CLR 651; [1970] AC 827 (“Blue Metal Industries”), whether an amendment to the top up provision to insert (on the applicant’s case) the re-enacted provisions, ss 36 and 37 (and s 38) of the Post-Amendment WC Act would change the character of that provision so as to reflect a different policy for that clause of the subject awards.

164. It is instructive, in that respect, to briefly further explore Lord Morris’ judgment.

165. The issue in Blue Metal Industries was described by his Lordship as follows (at 440):

The substantial issue in the appeal is whether the provisions of s 185 apply to a take-over offer made by two companies jointly or whether they only apply in the case of such an offer when made by one company. If the provisions apply to a take-over offer made by two companies jointly then they would apply to a take-over offer made by a number of companies jointly. So the problem must be approached by considering whether it was the intention of the legislature to enact that the compulsive powers given by s 185 could operate so that against the will of certain shareholders their shares may be transferred not to one transferee company but to a number of companies acting jointly.

166. His Lordship observed that an inquiry by the Court as to contrary intention was not confined to an examination of one particular section of an Act. The Court may consider the substance and tenor of the legislation as a whole.

167. It was in the context of those observations (at 441), that his Lordship approved the passage from the judgment of Lord Pearce in Sin Poh (at 228) (which is set out in Lister at [25]). This is the further test or means of ascertaining whether the contrary intention may be ascertained from the text of a provision. It is counterpart of the test posed by Lord Morris and raises very similar issues.

168. His Lordship’s reasoning as to the ascertainment of contrary intention is instructive (at 442):

If regard is being had to the substance and tenor of the provisions in s 185(1) their Lordships think that there is great force in the submission that whereas there are many policy considerations making it appropriate that if an offer which a company has made has proved acceptable to nine-tenths or more of those to whom the offer was addressed the company should be given powers of acquisition there may not be equal policy considerations making it appropriate to give the powers to a group of companies acting jointly. It would seem unlikely that the legislature would solely depend on the provisions of the Interpretation Act if there was an intention to legislate with such important consequences as to give powers of compulsory acquisition not to a single acquiring company but to a group of companies. The Interpretation Act is a drafting convenience. It is not to be expected that it would be used so as to change the character of legislation. Acquisition of shares by two or more companies is not merely the plural of acquisition by one. It is quite a different kind of acquisition with different consequences. It would presuppose a different legislative policy. [Emphasis added.]

169. The amendment of the top up provision to insert a reference, as contended by the applicant, to the re-enacted provisions of the Post-Amendment WC Act would, in my view, change the character of the top up provision such that a different policy was reflected in the provision (the counterpart of “legislative policy” change referred to in Lister at [27]).

170. The contrary intention arises from the text of the top up provision, as demonstrated from the earlier construction of that provision, to which I will now briefly return, in order to demonstrate the connection between that construction and contrary intention.

171. The words of the top up provision express an intention that entitlement within the provision be referrable to the particular provisions of the WC Act as it was prior to the Amendment Act. The provision was intended to refer to a specific type of entitlement by which employees caught by the subject award, who had been in receipt of the full rate of pay, during a period of total incapacity, in the first 26 weeks of such incapacity as referred to in s 36 of the Pre-Amendment WC Act (and defined in s 34) thereafter, would continue to receive the same rate (100% of the employee’s ordinary rate of pay) during the periods of such incapacity, thereafter, in consequence of the top up provision (so long as there was sick leave to do it for that purpose). The text of the top up provision thereby exposed the purpose of the provision, namely, the provision of recourse to a special class of sick leave in order to redress the loss of an employee’s ordinary rate of pay under the Pre-Amendment WC Act after the first 26 weeks of incapacity (as defined in s 34 of the WC Act) of (total) incapacity.

172. Had the construction proposed by the applicant been accepted, the prospect of a finding of contrary intention may have been lessened. On that approach, the top up benefits would represent a broad entitlement to top up any difference between compensation and the ordinary rate of pay of an employee under the subject awards such that the period of 26 weeks was simply an overlay on the new workers compensation scheme, even though, as the respondents put it, there would be no longer any prescription that employees would receive a particular benefit based upon the foundation of a 26 week period of incapacity (as defined by s 34 of the Pre-Amendment WC Act).

173. However, upon the proper construction of the top up provisions, having regard to the text of the provision, the context of the whole of cl 82 of the Conditions Award (and equivalent, but not identical, provisions under the remaining subject awards) and its purpose, the adoption into the top up provision of the re-enacted provisions for weekly compensation (from the Post-Amendment WC Act), would be incompatible with the intended operation of the top up provision, namely, to operate by reference to a particular set of entitlements under the Pre-Amendment WC Act which no longer existed.

174. That incompatibility is heightened by the repeal of s 34, because that provision gave meaning to the expression “the first 26 weeks [of incapacity]” in s 36 of the Pre-Amendment WC Act, and, therefore, the meaning of the expression the period of 26 weeks in the top up provision (due to its relationship to particular entitlements under the Pre-Amendment WC Act). This consideration resonates with the earlier discussion of the repeal of s 34 in the context of considering whether the re-enacted provisions of the Post-Amendment WC Act were “corresponding provisions” for the purposes of s 68(3) of the Interpretation Act.

175. The applicant contended that the reliance by the respondents upon changes to the WC Act brought about by the Amendment Act misunderstood the applicable test for contrary intention, which must be based upon the text of the top up provision.

176. The immediately preceding analysis within this judgment is, of course, predicated upon the text of the provision as it is dependent upon the construction of the amended provisions and whether the provision, so understood, would indicate a contrary intention.

177. I do not consider, however, the respondents’ reliance on changes brought by the Amendment Act to be erroneous, so long as that reliance fixed upon, as it did, the effect of the changes brought by the re-enacted provisions, which were then said to be introduced or referred to in the top up provisions by s 68(3). Thus, the analysis by the respondents was, in my view, confined to a permissible examination of the nature and the scope of the changes brought about by the re-enacted provisions so as to understand whether the insertion of a reference to those provisions in the top up provision (extended from the existing reference to s 36) would indicate a change in the character of the top up provision.

178. Bearing in mind those considerations, I consider that the changes brought about by or reflected in the re-enacted provisions would, if the top up provision was amended to incorporate the re-enacted provisions, change the character of the provision to reflect a new “legislative policy”. That analysis also reflects why, under the further test posed by Handley JA out of Sin Poh, there was reason to suppose the Commission may have rejected the amendments. Those changes and the relevant effect on the policy of the top up provisions are outlined below:

1. The Post-Amendment WC Act scheme for workers compensation was underpinned by a policy that the provision of less than 100% of the worker’s pre-injury weekly earnings (as defined in s 44C of the Post-Amendment WC Act) would encourage a return to work at the earliest available time. The policy generally underpinning the top up provision was different, in that, when married with s 36, and subject to available sick leave, the provision would permit employees to retain 100% of the current weekly wage rate (see as defined in s 36(2) of the Pre-Amendment WC Act) or the employee’s ordinary rate of pay (see cll 3.42 and 82.2 of the Conditions Award). The reference to a worker continuing to receive compensation after the period of 26 weeks under s 36 of the Pre-Amendment WC Act is a reference to the period under the Pre-Amendment WC Act where the compensation fell below 100% of the worker’s ordinary rate of pay. As the respondents submitted, in relation to the Post-Amendment WC Act scheme, “there is a quite different policy decision underpinning the question of top up”.

2. There was no demur that the effect of the reference to the re-enacted provisions would be to significantly extend the period that an employee might be in receipt of 100% compensation via top up payments principally because the amount of top up payment would most likely be less in the post 26 week period under the Post-Amendment WC Act (the period contemplated by the declaration under which the top up provision would operate in the Post-Amendment WC Act). Thus, there would be a change to the policy of the top up provision as to the scope of operation of the provision.

3. The provisions of the WC Act for weekly compensation after the Amendment Act extended to partially incapacitated workers, whereas the top up provision continues to concern, by reference to s 36 of the Pre-Amendment WC Act, only totally incapacitated workers.

4. The respondents submitted, correctly, in my view, that a “quite different quantum… is claimable” and there were “different circumstances in which it was claimable” under the Post-Amendment WC Act.

179. The combination of the entirety of the considerations under this heading reveals that, upon the proper construction of the top up provision, and the operation of s 68(3) (assuming the provision applies contrary to my earlier preliminary observations) the inclusion of a reference to the re-enacted provisions, ss 36 and 37 (and potentially, under the applicant’s contentions, s 38) of the Post-Amendment WC Act, by way of amendment to the reference to s 36 of the WC Act in the top up provisions, would involve, in my view, a change in the award maker’s policy apparent in the top up provision.

180. To once again adopt the language of Lord Morris, it is unlikely the legislature would solely depend upon the provisions of the Interpretation Act if there was an intention to “legislate” with such important consequences involved in the change in the character of the top up provision brought about by the re-enacted provisions. The respondents were correct to submit that the changes introduced to the top up provisions by the operation of the Interpretation Act in the manner proposed by the applicant would effectively re-write the top up provision. A further consideration, and one not addressed by the applicant, was how the reference to s 36 of the WC Act may be extended to a reference to s 38 of the Post-Amendment WC Act when that section dealt with materially different considerations to the Pre-Amendment WC Act. For example, s 38 effectively created a statutory cap on weekly compensation payments, which was unknown under the Pre-Amendment WC Act.

181. The further test referred to by Handley JA in Lister (derived from Sin Poh) is not easily applied in the present context. The Court is here required to consider the operation upon an award which, whilst derived from an exercise of a power which is legislative in nature, was made by a Tribunal that was conferred with broad discretionary powers exercised judicially within legislative constraints (and the constraints of delegated legislation). Thus, there are difficulties in applying a test under which an inquiry is made, in the context of the award, as to whether there is reason to suppose that the Commission (in substitution for the “legislature” in the test annunciated in Sin Poh), if offered the amendment to a “Bill” (read the making or variation of an award) would have rejected it. Undertaking such analysis is further complicated by the fact the Commission has before it extant applications to vary the, subject awards, so as to reflect that which the applicant seeks in the declarations.

182. In applying this test, it should be emphasised, however, that the relevant question is whether, as submitted for the applicant, if the policy evident in the existing provision was applied or followed, there are grounds to believe that a variation would be rejected.

183. Bearing in mind those aforementioned constraints, I consider that there are two factors which should result in the conclusion that there is reason to support the Commission would have rejected the “amendments” (that is the reference to the re-enacted provisions) if they were offered, as follows:

1. It is most unlikely that the Commission, without more, would have approved of a top up provision which had the effect of supplementing the wages of employees in receipt of weekly compensation payments under the WC Act which operated upon the basis of an eligibility (and temporal) requirement, namely, a period of 26 weeks, which bore no relationship to the system of workers compensation under that Act. I agree with the respondents, for the reason given in (2) below, that the Commission would not simply replace, in that context, the existing reference to s 36 of the WC Act with the re-enacted provisions, which were not compatible with the policy reflected in the top up provision.

2. The amendment to the top up provision would not be made without a fresh consideration of the terms of the provision because the reference to the re-enacted provisions would significantly change the “legislative” policy (in the sense of policy of the drafters of the subject awards) underpinning the top up provision.

184. Given that those conclusions amply demonstrate why contrary intention should be found, as arising under the further test stated in Lister, it is unnecessary, and in fact, undesirable to make a determination as to the further relevant factors relied upon, in that respect, by the respondents, namely, the prospect that the application of the top up provision in the context of the Post-Amendment WC Act provisions will lead to increased economic cost and/or invoke the operation of s 146C of the IR Act. Those issues will no doubt feature in the extant proceedings before the Commission concerning applications to vary the top up provisions (reflecting, it would appear, the terms of the declarations) where the Commission will apply, upon the evidence before it, its specialist knowledge of the subject awards and the areas of employment governed by them to the resolution of those questions as well as the merits of creating fresh rights under the subject awards vis-à-vis top up payments.

185. It follows that the ambulatory approach in s 68(3) (and s 68(1)) do not apply to the top up provisions. Accordingly, the common law presumption applies, namely, that any reference to the WC Act in the award is taken to be a reference to the form of the legislation as it was enacted: see Forsyth (at [27]) and Deacon.

184. The contention of the applicant summarised in [17(1)], as elaborated in its submissions summarised above, must fail.

CONCLUSIONS

187. In the circumstances, upon the proper construction of the subject awards, and the provisions of s 68(1) and (3) of the Interpretation Act, having no application to the top up provisions upon the passing of the Amendment Act due to the existence of a contrary intention for the purposes of s 5(2) of the Interpretation Act (as found in the top up provisions), the declarations sought with respect to the top up provisions of the subject awards must be rejected.

188. On 29 June 2017, the final day of hearing, the parties agreed that “each party should bear their own costs of the proceedings” and sought no order as to costs.

ORDERS

189. The Court makes the following orders in the consolidated proceedings:

1. The applications for declaration are dismissed.

2. There is no order as to costs.

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Amendments

18 October 2018 - Typographical error corrected at [49].

Decision last updated: 18 October 2018