PUBLIC TRANSPORT AUTHORITY OF WESTERN AUSTRALIA -v- YOON [2017] WASCA 25

Jurisdiction:	WESTERN AUSTRALIAN INDUSTRIAL APPEAL COURT	Citation No:	[2017] WASCA 25
Case No:	IAC:4/2015	Heard:	20 JULY 2016
Coram:	BUSS J MURPHY J KENNETH MARTIN J	Delivered:	9/02/17
No of pages:	37	Judgment Part:	1 of 1
Result:	Appeal allowed
Category:	A
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Parties:	PUBLIC TRANSPORT AUTHORITY OF WESTERN AUSTRALIA JUNGHEE YOON
Catchwords:	Employment law Long service leave Whether entitlement under both the employee's Industrial Agreement and the Long Service Leave Act 1958 (WA) or whether one or the other applies Statutory construction Proper construction of the Long Service Leave Act Meaning of 'employee' Operation of s 4(3) of the Long Service Leave Act Whether person is, by virtue of industrial agreement or other instrument, 'entitled to, or eligible to become entitled to, long service leave at least equivalent to the entitlement to long service leave under' the Long Service Leave Act Manner and time at which comparison between entitlement under industrial agreement or other instrument, and entitlement under Long Service Leave Act, to be undertaken Whether comparison to be made prospectively by reference only to the terms of the respective instruments or whether comparison to be undertaken from time to time over the course of the employee's working life having regard to the individual's particular circumstances
Legislation:	Long Service Leave Act 1958 (WA)
Case References:	Bull v Attorney-General (NSW) [1913] HCA 60; (1913) 17 CLR 370 City of Kwinana v Lamont [2014] WASCA 112; (2014) 201 LGERA 334 Collins v Charles Marshall Proprietary Limited [1955] HCA 44; (1955) 92 CLR 529 Director General of Department of Transport v McKenzie [2016] WASCA 147 IW v City of Perth [1997] HCA 30; (1997) 191 CLR 1 Kennedy v Board of Fire Commissioners [1967] AR 455 Khoury v Government Insurance Office (NSW) [1984] HCA 55; (1984) 165 CLR 622 New South Wales Aboriginal Land Council v Minister Administering the Crown Lands Act [2016] HCA 50 New South Wales Nurses' Association v Ramsay Health Care Australia Pty Ltd [2009] FMCA 579; (2009) 185 IR 1 Nilsen Development Laboratories Proprietary Limited v The Federal Commissioner of Taxation of the Commonwealth of Australia [1981] HCA 6; (1981) 144 CLR 616 Public Transport Authority of Western Australia v Yoon [2015] WAIRC 00918 Re Municipal Officers (New South Wales Electricity Undertakings) Long Service Leave Award, 1970 (1973) 148 CAR 917 The Queen v Hamilton Knight; Ex parte The Commonwealth Steamship Owners Association [1952] HCA 38; (1952) 86 CLR 283 Victims Compensation Fund Corporation v Brown [2003] HCA 54; (2003) 77 ALJR 1797 Yoon v Public Transport Authority of Western Australia [2015] WAIRC 00411

JURISDICTION : WESTERN AUSTRALIAN INDUSTRIAL APPEAL COURT CITATION : PUBLIC TRANSPORT AUTHORITY OF WESTERN AUSTRALIA -v- YOON [2017] WASCA 25 CORAM : BUSS J

MURPHY J

KENNETH MARTIN J

HEARD : 20 JULY 2016 DELIVERED : 9 FEBRUARY 2017 FILE NO/S : IAC 4 of 2015 BETWEEN : PUBLIC TRANSPORT AUTHORITY OF WESTERN AUSTRALIA

Appellant

AND

JUNGHEE YOON

Respondent

ON APPEAL FROM:

Jurisdiction : WESTERN AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION

Coram : J H SMITH (ACTING PRESIDENT)

A R BEECH (CHIEF COMMISSIONER)

S J KENNER (COMMISSIONER)

Citation : [2015] WAIRC 00918

File No : FBA 7 of 2015

Catchwords:

Employment law - Long service leave - Whether entitlement under both the employee's Industrial Agreement and the Long Service Leave Act 1958 (WA) or whether one or the other applies

Statutory construction - Proper construction of the Long Service Leave Act - Meaning of 'employee' - Operation of s 4(3) of the Long Service Leave Act - Whether person is, by virtue of industrial agreement or other instrument, 'entitled to, or eligible to become entitled to, long service leave at least equivalent to the entitlement to long service leave under' the Long Service Leave Act - Manner and time at which comparison between entitlement under industrial agreement or other instrument, and entitlement under Long Service Leave Act, to be undertaken - Whether comparison to be made prospectively by reference only to the terms of the respective instruments or whether comparison to be undertaken from time to time over the course of the employee's working life having regard to the individual's particular circumstances

Legislation:

Long Service Leave Act 1958 (WA)

Result:

Appeal allowed

Category: A

Representation:

Counsel:

Appellant : Mr G Tannin SC & Ms L Pilot

Respondent : Mr C Fogliani

Solicitors:

Appellant : State Solicitor's Office

Respondent : W G McNally Jones Staff Lawyers

Case(s) referred to in judgment(s):

Bull v Attorney-General (NSW) [1913] HCA 60; (1913) 17 CLR 370
City of Kwinana v Lamont [2014] WASCA 112; (2014) 201 LGERA 334
Collins v Charles Marshall Proprietary Limited [1955] HCA 44; (1955) 92 CLR 529
Director General of Department of Transport v McKenzie [2016] WASCA 147
IW v City of Perth [1997] HCA 30; (1997) 191 CLR 1
Kennedy v Board of Fire Commissioners [1967] AR 455
Khoury v Government Insurance Office (NSW) [1984] HCA 55; (1984) 165 CLR 622
New South Wales Aboriginal Land Council v Minister Administering the Crown Lands Act [2016] HCA 50
New South Wales Nurses' Association v Ramsay Health Care Australia Pty Ltd [2009] FMCA 579; (2009) 185 IR 1
Nilsen Development Laboratories Proprietary Limited v The Federal Commissioner of Taxation of the Commonwealth of Australia [1981] HCA 6; (1981) 144 CLR 616
Public Transport Authority of Western Australia v Yoon [2015] WAIRC 00918
Re Municipal Officers (New South Wales Electricity Undertakings) Long Service Leave Award, 1970 (1973) 148 CAR 917
The Queen v Hamilton Knight; Ex parte The Commonwealth Steamship Owners Association [1952] HCA 38; (1952) 86 CLR 283
Victims Compensation Fund Corporation v Brown [2003] HCA 54; (2003) 77 ALJR 1797
Yoon v Public Transport Authority of Western Australia [2015] WAIRC 00411

BUSS & MURPHY JJ

Introduction

1 This appeal concerns the proper construction of s 4(3) of the Long Service Leave Act 1958 (WA) (LSL Act). It is an appeal from a decision of the Full Bench of the Western Australian Industrial Relations Commission: Public Transport Authority of Western Australia v Yoon1(Full Bench decision).

2 The point of construction arises in a dispute between the respondent (Ms Yoon) and the appellant (the Authority). In summary, Ms Yoon commenced employment with the Authority on 28 May 2007. She worked for the Authority until 26 July 2014, when she resigned. The terms of her employment were contained in an industrial agreement entitled 'Public Transport Authority Railway Employees (Transperth Train Operations) Industrial Agreement 2011' (Agreement). The Agreement contained certain entitlements in relation to long service leave, including, under cl 6.6.5, certain entitlements with respect to pro-rata long service leave.

3 When Ms Yoon left her employment, she was not eligible for the pro-rata entitlements under cl 6.6.5 of the Agreement. She nevertheless contended that she had the benefit of a pro-rata entitlement to long service leave under the LSL Act.

4 Under s 8 of the LSL Act, an 'employee' has an entitlement to long service leave on certain terms. This includes, in broad terms, an entitlement to a payment in lieu of pro-rata long service leave upon termination (in certain circumstances) after 7 years. An 'employee' is defined in s 4(1)(a) to include, subject to subsection (3), a person employed by an employer. Thus, Ms Yoon, as a person employed by the Authority, would be an 'employee', subject, relevantly, to the operation of s 4(3) of the LSL Act.

5 Section 4(3), in broad terms and relevantly, removes from the class of 'employee' for the purposes of the LSL Act, persons who, by virtue of an industrial agreement, are entitled to, or eligible to become entitled to, 'long service leave at least equivalent to the entitlement to long service leave under [the LSL] Act'. Ms Yoon contended that, under the Agreement, she had no long service leave entitlement in relation to pro-rata leave when she resigned and, accordingly, her entitlement was not 'at least equivalent to the entitlement to long service leave under [the LSL] Act' within the meaning of s 4(3) of the LSL Act. She thereby qualified as an 'employee' under the LSL Act, and hence had an entitlement to the pro-rata leave payment provided for in s 8 of the LSL Act. The Authority contended that, on the proper construction of s 4(3) of the LSL Act, Ms Yoon had no entitlement.

6 The dispute was first determined by Industrial Magistrate G Cicchini on 28 May 2015 (magistrate's decision).2 The Full Bench of the Western Australian Industrial Relations Commission dismissed an appeal by the Authority. The Authority now appeals the Full Bench decision. There is one ground of appeal, to the effect that the Full Bench erred in its interpretation of s 4(3) of the LSL Act. Ms Yoon adopted and relied on the reasons of the Full Bench as being the correct interpretation of s 4(3) of the LSL Act.

Section 4(3) of the LSL Act and the issues in the appeal

7 Section 4(3) of the LSL Act provides:

Where a person is, by virtue of -

(a) an award or industrial agreement;

(b) an employer-employee agreement under Part VID of the Industrial Relations Act 1979 or other agreement between the person and his employer; or

entitled to, or eligible to become entitled to, long service leave at least equivalent to the entitlement to long service leave under this Act, that person is not within the definition of 'employee' in subsection (1).

8 The issues raised by the parties in this appeal in relation to the proper construction of s 4(3) of the LSL Act, are, in essence, as follows.

9 The first issue involves a consideration of the nature of, and circumstances in which, the comparison is to be undertaken for the purposes of s 4(3) between a person's long service leave entitlement under an award, industrial agreement, other agreement, or Commonwealth, State or Territory enactment (collectively 'other instrument') on the one hand, and under the LSL Act on the other hand. The question is whether the comparison in relation to a person's entitlement is to be undertaken prospectively, by reference to the terms of the two competing instruments (ie, the other instrument and the LSL Act) at the time that each potentially applies to the person's employment, or whether it is to be undertaken retrospectively as the person's individual circumstances change from time to time over the course of their employment. The Authority contends for the former approach,3 and Ms Yoon contends for the latter. Ms Yoon contends that the language of s 4(3) 'necessitates a focus on the individual circumstances of the person making the claim'.4

10 The latter approach may be illustrated as follows. Under the LSL Act, an employee after 10 years continuous service has an entitlement to 8^2/3 weeks long service leave and, after 7 years, but less than 10 years, an entitlement to a payment in lieu of pro-rata long service leave in the event of the termination of the person's employment in certain circumstances. Suppose that under the other instrument, an employee has an entitlement to 15 weeks long service leave after 10 years, but has no pro-rata entitlement to a payment in lieu in the meantime. On the latter approach, no prospective comparison is done and s 4(3) involves a 'wait and see' approach. If the person in fact completes 7 years of continuous service and their employment is then terminated, the relevant comparison is undertaken at that stage. Because, at that time, the other instrument made no provision for payment in lieu, the person would be an 'employee' within the meaning of the LSL Act, and would be entitled to the benefit of payment in lieu of pro-rata long service leave as provided for under s 8(3) of the LSL Act. On the other hand, if the person in fact stayed and completed 10 years of continuous service, the comparison would be made at that point. At that time, as their greater entitlement would be under the other instrument (15 weeks as opposed to 8^2/3 weeks after 10 years), they would not then be an 'employee' for the purposes of the LSL Act, and they could claim under the other instrument.

11 The second issue is partly related to the first, but is more concerned with the manner of comparison under s 4(3). The Authority contends that the prospective comparison applied under s 4(3) of the LSL Act is to be undertaken in a 'global' way, by considering and weighing the various aspects of the entitlement to long service leave under the respective instruments. On this approach, s 4(3) calls for an assessment of the pros and cons of the scheme under each instrument, and an objective determination as to whether overall, the other instrument provides for an entitlement 'at least equivalent' to the entitlement to long service leave under the LSL Act. Ms Yoon says that this approach is 'absurd and unworkable'. She submitted, in effect, that, by way of illustration, the magistrate correctly observed that any objective comparison of the terms of the Agreement and the terms of the LSL Act 'would be difficult if not impossible to achieve'.5

12 In response, the Authority says that Ms Yoon's construction produces its own complexity, if not unworkability, in the application of the LSL Act. The Authority refers to the following example. Each of the LSL Act and the Agreement provides for an additional period of leave at intervals after the 10-year benchmark. In the case of the LSL Act, it is a further 4^1/3 weeks at (in effect) 15 years. In the case of the Agreement, it is a further 13 weeks at (in effect) 17 years. The Authority says that on Ms Yoon's construction, an employee could be given 4^1/3 weeks leave under the LSL Act at the 15-year service mark, and a further 13 weeks under the Agreement at the 17-year service mark. Ms Yoon's response to this is discussed later in these reasons. The Authority further says that it would be impossible for an employer to make proper provision for long service liabilities if an employee could, in effect, move in and out of different long service leave schemes over the course of their employment.

The magistrate's decision and the Full Bench decision

13 The learned magistrate's reasons were summarised in the Full Bench decision as follows:6

The Industrial Magistrate found that to ascertain whether the terms of the agreement are at least equivalent to the LSL Act required an analysis of the circumstances of the person applying for long service leave and by having regard to a particular person's entitlement when it was necessary to do so. He found this was necessary as a particular person's entitlement will only crystallise once an applicable milestone is met. In making these findings, the Industrial Magistrate found as follows:

(a) An objective analysis of whether 'on the whole', the terms of the agreement are at least equivalent to the LSL Act, is very difficult, if not impossible to achieve.

(b) The significance of the benefit provided by any particular provision will be dependent upon individual circumstances. For some, it may be more important to reach the subsequent milestone in five years rather than seven years. Others may not want to cash out their long service leave entitlement and therefore such an entitlement is of no particular benefit. For others close to retirement age, reaching the pro-rata qualification will be of more importance than reaching the 10 year milestone which might be unachievable.

(c) Each benefit must be weighed against an employee's personal circumstances. No attempt can be made to weigh up, as a whole, the entitlement under the agreement in comparison to the entitlement under the LSL Act. The only practicable way equivalency can be determined is to weigh the competing applicable benefits relevant to the employee at the time that the milestone giving rise to the benefit is reached. The requirement for equivalency in s 4(3) of the LSL Act is a beneficial provision which imports the setting of minimum standards for each particular benefit.

(d) The entitlement to long service leave is personal and is dependent upon individual circumstances. On the event of a milestone being met or in contemplation of that happening, an assessment has to be made as to whether the particular entitlement to long service leave, under the applicable industrial agreement, is at least equivalent to that provided by the LSL Act. It is only then that consideration must be given to whether a person is an employee for the purposes of the LSL Act or not.

(e) Given that industrial instruments, particularly industrial agreements, may be finite it will be impossible for employers to determine whether a person is an employee for the purposes of the LSL Act until it is necessary to do so. That is, on or about the time that the milestone is met. That process is neither unwieldy nor onerous. Indeed, the employer can only assess each person's entitlement on a case-by-case basis. An analysis or comparison at any other time will be practically impossible.

(f) It follows that if an employer has two employees, one may be an employee within the meaning of the LSL Act and the other may not, dependent upon their circumstances. In the context of the agreement, if a person worked for more than seven years but less than 10 years, that person will be an employee within the meaning of the LSL Act, whereas, if the person worked more than 10 years they will not be an employee within the meaning of the LSL Act.

(g) The submission that the pro-rata provision in s 8(3) of the LSL Act should be read in the context of the less beneficial provisions as to the quantum of leave in s 8(2)(a) of the LSL Act is rejected. The entitlement under s 8(3) of the LSL Act is a discrete benefit contextually different from s 8(2)(a) of the LSL Act. There is no dependency between one provision and the other. Indeed, there is no reason to consider the provisions together.

(h) When the circumstances of Ms Yoon are considered and the terms of the agreement, the pro-rata long service leave entitlement under the agreement is repugnant to, and not at least equivalent to, the entitlement to pro-rata long service leave under the LSL Act. Thus, Ms Yoon was an employee for the purposes of the LSL Act and is eligible to receive a pro-rata long service leave entitlement of 6.17 weeks, valued at $6,108.82.

14 In the Full Bench decision, Smith AP effectively agreed with the reasoning of the industrial magistrate. Her Honour referred to the LSL Act as being beneficial legislation,7 and said:8

It is apparent from the provisions of the LSL Act that 'long service leave' is comprised of a bundle of entitlements, or put another way as a bundle of rights to long service leave which can accrue in varying circumstances. As such it cannot be said that there is a singular or indivisible entitlement or right to long service leave.

…

Without regard to the circumstances of a person no assessment can be made as to whether a particular person is entitled to, or eligible to become entitled to, long service leave under an industrial instrument that is at least equivalent to the entitlement under the LSL Act.

15 Beech CC said, amongst other things:9

Contrary to the submissions of the [Authority] … [s 4(3)] does not involve an objective comparison to determine whether, on the whole, the agreement is at least equivalent to the LSL Act. The language of s 4(3) of the Act does not require such an approach.

Section 4(3) commences by referring to 'a person'. It concludes by saying that where a person is entitled to, or eligible to become entitled to, long service leave under an award, agreement, [etc] … that is at least equivalent to the entitlement under the LSL Act, it is that person who is not within the definition of 'employee' under the LSL Act. This suggests that the determination to be made is in relation to individual circumstances rather than by comparing the entitlements as a whole.

Section 4(3) also refers to where a person is 'entitled to, or eligible to become entitled to', long service leave under an award [etc] but does not refer [to] an eligibility to become entitled to long service leave under the LSL Act. In relation to the LSL Act, s 4(3) does not use the words 'or eligible to become entitled to'. The comparison required by s 4(3) is not of an entitlement or eligibility to become entitled under an award [etc] and an entitlement or eligibility to become entitled under the LSL Act; it is between:

- an entitlement or eligibility to become entitled under an award [etc]; and

- an entitlement under the LSL Act.

This, in my view, also suggests that the determination is not made by comparing the entitlements under an award [etc] as a whole with the entitlements under the LSL Act as a whole.

16 Kenner C joined in dismissing the appeal, but took a somewhat different approach insofar as his Honour said that s 4(3) 'does not necessarily require the crystallisation of the entitlement or a 'milestone' event to be reached, as found by the … Magistrate, but it may do'.10

The LSL Act

The terms of the LSL Act11

17 According to its long title, the LSL Act is '[a]n Act to provide for the granting of long service leave to certain Western Australian employees and for matters incidental thereto'.

18 Part II of the LSL Act is entitled 'Construction and application of this Act'. It contains s 4 - s 7. Section 4(1) sets out defined terms, which are to apply unless the context requires otherwise.

19 Section 4(1) defines 'employee' as follows:

employee

means, subject to subsection (3) -

(a) any person employed by an employer to do work for hire or reward including an apprentice;

(b) any person whose usual status is that of an employee;

(c) any person employed as a canvasser whose services are remunerated wholly or partly by commission or percentage reward; or

(d) any person who is the lessee of any tools or other implements of production or of any vehicle used in the delivery of goods or who is the owner, whether wholly or partly, of any vehicle used in the transport of goods or passengers if the person is in all other respects an employee.

20 Section 4(3) has been set out earlier.

21 Section 5 provides that an employer and employee may agree that the employee may forgo his entitlement to long service leave under the LSL Act if the employee is given 'an adequate benefit in lieu of the entitlement', and the agreement is in writing.

22 Section 8 of the LSL Act, referred to below, provides for the entitlement to long service leave in respect of 'continuous employment' with either the same employer, or a person 'deemed' to be the same employer: s 8(1). In general terms, an employer is 'deemed' to be the same employer where a business has been 'transmitted' from one employer to another employer: s 6(4) and s 6(5).

23 The concepts of 'employment' and 'continuous' employment are addressed in s 6(1) - (3) of the LSL Act. For the purposes of the LSL Act, 'employment' of an employee, whether before or after the commencement of the LSL Act, is deemed to include, by s 6(1)(a) - (c), periods of absence from duty for annual leave, long service leave, public holidays, sickness (up to 15 days per year) and any period following any termination of the employment where such termination has been effected by the employer to avoid its long service leave obligations under the LSL Act. By s 6(d), 'employment' also includes any period where the employment of the employee was or is interrupted by certain military service.

24 For the purposes of the LSL Act, the employment of an employee, whether before or after the commencement of the LSL Act, is deemed to be, by s 6(2), 'continuous' notwithstanding the 'transmission' of a business, any interruption referred to in s 6(1), absences authorised by the employer, the standing down of an employee under certain Commonwealth statutes, absence from duty (subject to certain matters) arising from an industrial dispute, termination from employment by the employer in specified circumstances where the employee is subsequently re-employed by the same employer within certain time frames, and reasonable absence on legitimate union business. It is also deemed to be 'continuous', notwithstanding any absence of the employee from his employment after the coming into operation of the LSL Act by reason of any cause not specified in subsections (1) or (2) unless the employer, during the absence or within 14 days of the termination of the absence, gives written notice to the employee that the continuity of his employment has been broken by the absence. In such a case, the absence is deemed to have broken the continuity of employment.12

25 Section 7 contains three subsections. The heading to s 7 is 'Employment before commencement of this Act'. However, only s 7(1) deals with that topic exclusively, and the heading to a section is taken not to be part of the written law: s 32 of the Interpretation Act 1984 (WA).

26 Section 7(1) provides, in effect, as follows. Where an employee is employed by an employer at the time the LSL Act comes into operation (ie, 24 December 1958), for the purposes of the LSL Act, the 'employment' by that employer is deemed to have commenced when the employee first commenced employment by that employer. However, in calculating the employee's entitlement to long service leave under the LSL Act, no more than 20 years continuous employment prior to the commencement of the operation of the LSL Act, is to be counted.

27 Section 7(2) of the LSL Act provides:

Any leave, in the nature of long service leave or, as the case may be, payment in lieu thereof, granted, whether before or after the coming into operation of this Act, under any long service leave scheme and irrespective of this Act to an employee in respect of any period of continuous employment with his employer, shall be taken into account in the calculation of the employee's entitlement to long service leave under this Act as if it were long service leave taken under this Act, or, as the case may be, payment in lieu of long service leave under this Act and to be satisfaction to the extent thereof of any entitlement of the employee under this Act.

28 Section 7(3) of the LSL Act provides:

The entitlement to leave under this Act shall be in substitution for and satisfaction of any long service leave to which the employee may be entitled in respect of employment of the employee by the employer.

29 Part III of the LSL Act is entitled 'Entitlements to long service leave or to payment in lieu thereof'. It contains s 8 - s 10.

30 Section 8 of the LSL Act provides:

8. Long service leave

(1)

An employee

is entitled

in accordance with, and subject to, the provisions of this Act,

to long service leave

on ordinary pay in respect of

continuous employment

with one and the same employer, or with a person who, being a transmittee, is deemed pursuant to section 6(4) to be one and the same employer.

(2) An employee who has completed at least 10 years of such continuous employment, as is referred to in subsection (1), is entitled to an amount of long service leave as follows -

(a)

in respect of 10 years so completed, 8 2/3 weeks

;

(b) in respect of each 5 years' continuous employment so completed after such 10 years, 4 1/3 weeks; and

(i)

by his death

;

(ii) in any circumstances otherwise than by his employer for serious misconduct,

in respect of the number of years

of such continuous employment

completed since the employee last became entitled under this Act to an amount of long service leave, a

proportionate amount on the basis of 8 2/3 weeks for 10 years of such continuous employment

(3) Where an employee has

completed at least 7 years of such continuous employment

since the commencement thereof, but less than 10 years, and

the employment is terminated

(a)

by his death

; or

(b) for any reason other than serious misconduct,

the amount of leave to which the employee is entitled shall be a proportionate amount on the basis of 8 2/3 weeks for 10 years of such continuous employment.

(4) If an employee has completed at least 9 but less than 15 years continuous employment prior to the commencement day, then, despite subsection (2)(a), the employee cannot take long service leave under subsection (2)(a) until after -

(a) if the employee has completed at least 14 years continuous employment prior to the commencement day - completing 15 years continuous employment; or

(b) in any other case - 12 months after the commencement day.

(5) Subsection (4) does not apply if the employee and his or her employer agree to that effect in writing.

(6) Subsection (4) does not apply in respect of a period of continuous employment prior to the commencement day in respect of which the employee has become entitled to take long service leave.

(7) An employee who becomes entitled to take long service leave under subsection (2)(a) in accordance with subsection (4) or (5) also becomes entitled to take long service leave under subsection (2)(b), in respect of the period of continuous employment that exceeds 10 years, pro rata.

(8) Subsection (7) does not apply to an employee if, before being granted the long service leave, the employee completes 15 years continuous employment.

(9) If an employee takes long service leave in accordance with subsection (7), the employee is entitled, after completing 15 years continuous employment, to take the remainder of his or her entitlement under subsection (2)(b) not already taken in accordance with subsection (7).

(10) In subsections (4) and (6) -

commencement

day

means the day on which the

Labour Relations Legislation Amendment Act 2006

Part 7 Division 2 came into operation. (emphasis added) (footnotes omitted)

31 Section 9 of the LSL Act provides:

9. Commencement of long service leave

(1) Where an employee becomes entitled to a period of long service leave under this Act the leave is to be granted and taken -

(a) subject to any agreement between the employer and the employee, as soon as reasonably practicable after it becomes due; and

(b) in one continuous period, or if the employer and the employee so agree, in separate periods of not less than one week.

(1a) Where an employer and employee have not agreed when the employee is to take the employee's long service leave, subject to subsection (1b), the employer is not to refuse the employee taking, at any time suitable to the employee, any period of long service leave to which the employee became entitled more than 12 months before that time.

(1b) The employee is to give to the employer at least 2 weeks' notice of the period during which the employee intends to take the long service leave.

(2) In a case to which section 8(2)(c) or section 8(3) applies the employee shall be deemed to have been entitled to and to have commenced leave immediately prior to such termination. In such cases and in any case in which the employment of the employee who has become entitled to leave hereunder is terminated before such leave is taken or fully taken the employer shall, upon termination of his employment otherwise than by death pay to the employee and upon termination of employment by death pay to the personal representative of the employee upon request by the personal representative, a sum equivalent to the amount which would have been payable in respect of the period of leave to which he is entitled or deemed to have been entitled and which would have been taken but for such termination. Such payment shall be deemed to have satisfied the obligation of the employer in respect of leave hereunder.

(3) An employee is to be paid for a period of long service leave at the time payment is made in the normal course of the employment, unless -

(a) the employee requests in writing to be paid before the period of leave commences, in which case the employee is to be so paid; or

(b) the employee and employer agree to another method of payment.

(4) If -

(a) a public holiday occurs during a period of long service leave taken by an employee under section 8(2)(a) or (b); and

(b) the employee is otherwise entitled to that holiday under the employee's conditions of employment,

the period of long service leave is increased by one day for each such public holiday.

32 Section 10 of the LSL Act provides:

10. Taking leave in advance

(1) Any employer may by agreement with an employee allow leave to such an employee before the right thereto has accrued due, but where leave is taken in such a case the employee shall not become entitled to any further leave hereunder in respect of any period until after the expiration of the period in respect of which such leave had been taken before it accrued due.

(2) Where leave has been granted to an employee pursuant to subsection (1) before the right thereto has accrued due, and the employment to which the leave relates subsequently is terminated, the employer may deduct from whatever remuneration is payable upon the termination of the employment such amount as represents payment for any period for which the employee has been granted long service leave to which he was not at the date of termination of the employment or prior thereto entitled.

33 By s 11(1)(a), an industrial magistrate's court has jurisdiction to hear and determine all questions and disputes, including 'whether a person is or is not an employee, or an employer, to whom this Act applies'. Section 11 is part of pt IV entitled 'Enforcement of the provisions of the Act'.

34 Part VII of the LSL Act is entitled 'Miscellaneous provisions'. It includes s 26 and s 27.

35 Section 26 provides:

26. Keeping of employment records

(1) An employer must ensure that details are recorded of -

(a) each employee's name and, if the employee is under 21 years of age, the employee's date of birth;

(b) the date on which the employee commenced employment with the employer;

(c) the gross and net amounts paid to the employee under the contract of employment, and all deductions and the reasons for them;

(d) all leave taken by the employee, whether paid, partly paid or unpaid;

(e) details of any agreement made under section 5 between the employer and the employee;

(f) such other details as are necessary for the calculation of the entitlement to, and payment for, long service leave under this Act; and

(g) other matters prescribed by the regulations.

(2) The employer must ensure that -

(a) the records are kept in accordance with the regulations; and

(b) each entry is retained during the employment of the employee and for not less than 7 years thereafter.

(3) A contravention of subsection (2) is not an offence but that subsection is a civil penalty provision for the purposes of the

Industrial Relations Act 1979

section 83E.

(4) Subsection (3) extends to a contravention that occurred within the period of 12 months ending on the coming into operation of the Labour Relations Legislation Amendment Act 2006 Part 7 Division 2 unless the employer was charged with an offence in respect of that contravention. (emphasis added) (footnotes omitted)

36 Section 27 provides:

27. Prohibition of employment during long service leave

(1) An employee shall not, during any period when he is on long service leave, engage in any employment for reward in substitution for the employment from which he is on leave.

(2) If an employee, during any period when he is on long service leave, engages in any employment for reward in substitution for the employment from which he is on leave the employee shall thereupon forfeit his right to leave hereunder in respect of the unexpired period of leave upon which he has entered, and the employer shall be entitled to withhold any further payment in respect of the period and to reclaim any payments already made on account of such period of leave.

(3) The provisions of this section shall not apply to an employee who, pursuant to section 9(2), is deemed to commence a period of leave on the day of the termination of his employment.

The history of s 4(3) of the LSL Act

37 Prior to the introduction of s 4(3) by s 46 of the Industrial Relations Legislation Amendment and Repeal Act 1995 (WA) (Amendment Act), s 4(1) of the LSL Act excluded persons from the definition of 'employee' by providing that an 'employee':

(i) if and while the person is entitled, or eligible to become entitled, to long service leave rights as a member of

the Public Service of the State;

the Teaching Service of the State;

the Railway Service of the State;

the Police Force of the State;

a Fire Brigade which is a 'permanent fire brigade' according to the interpretation given to that expression by section four of the Fire Brigades Act, 1942; or

(ii) if and while the person is employed by the Crown in the right of the State or by any agency or instrumentality of the Crown in the right of the State as a wage employee who is entitled, or eligible to become entitled, to long service leave rights; or

(iii) if and while the person is employed under the terms of an award or industrial agreement in force under the Industrial Arbitration Act, 1912; or

(iv) if and while the person is the subject of an exemption granted under the provisions of section five of this Act; or

(v) if and while the person is entitled or eligible to become entitled to long service leave under an award or industrial agreement referred to in subparagraph (iv) of paragraph (b) of this interpretation; or

(vi) if and while the person is less than the maximum age for compulsory attendance of children at a Government or efficient school as provided by the Education Act, 1928 or any proclamation made thereunder.

38 As Kenner C noted in the Full Bench decision:13

The LSL Act, when first made, provided that it was an Act to grant long service leave to employees whose employment was not regulated under the then

Industrial Arbitration Act 1912

(WA). The then s 4 of the Act set out a definition of 'employee' which contained a number of exclusions, one of which in s 4(c)(iii), included a person whose terms and conditions of employment were regulated by an award or industrial agreement under the then

Industrial Arbitration Act 1912

. A number of other exclusions to the definition of 'employee' applied to persons who were 'entitled, or eligible to become entitled' to long service leave elsewhere, such as in employment in the public sector or those covered by the Commonwealth awards etc.

In 1995 the Industrial Relations Legislation Amendment and Repeal Act 1995 (WA), among other things, amended s 4 of the LSL Act to insert the current s 4(3). This amendment, which took effect on 16 January 1996, introduced for the first time, the concept of 'equivalence' between entitlements under a relevant industrial instrument and those under the LSL Act, to determine who was to be covered by the legislation.

39 In other words, prior to the commencement of s 4(3) of the LSL Act, persons were excluded from the entitlement to long service leave under the LSL Act if their terms of employment were regulated by certain awards or industrial agreements, which may not have provided for long service leave. A person was also excluded from the statutory entitlement under the LSL Act if, in effect, he or she was covered for long service leave elsewhere, irrespective of the nature and scope of any benefit contained in the other instrument.

The operation of s 8 of the LSL Act

40 The effect of s 8 of the LSL Act is to confer on an 'employee' an entitlement to 'long service leave' in accordance with, and subject to the provisions of, the LSL Act. The term 'long service leave', as used in s 8 and elsewhere in the LSL Act, is not defined. Nevertheless (as senior counsel for the Authority acknowledged),14 when s 8 is read as a whole, it is apparent that the term encompasses two aspects of entitlement. The first is in the granting and taking of 'leave away from the employment whilst maintaining its continuity':15 s 6(1)(a)(ii), s 8(1), s 8(2)(a) and (b). The second is a conditional right to payment in lieu of pro-rata long service leave where the employment is terminated before the leave is taken: s 8(2)(c), s 8(3). Adopting the words of the majority of the High Court in Collins v Charles Marshall Proprietary Limited,16 (in relation to the long service legislation under consideration in that case) s 8 of the LSL Act:

begins so to speak with a primary period of long service leave to which a worker is to be entitled and it is subject to variations if his employment is terminated before he takes his leave.

41 In its latter aspect (ie, payment in lieu where the employment is terminated), the employee is deemed to have been entitled to the leave and to have commenced the leave immediately prior to termination: s 9(2). The relevant payment in such a case is 'deemed to have satisfied the obligation of the employer in respect of leave' under the LSL Act: s 9(2). The entitlement also contains its own qualifying period of continuous employment, and is contingent on the termination of the employment arising either by the death of the employee or (broadly speaking) otherwise than by reason of serious misconduct: s 8(2)(c)(i) - (ii), s 8(3)(a) - (b).

42 It appears that a general objective of the LSL Act is to reward long service, as all benefits increase proportionately to length of service: Kennedy v Board of Fire Commissioners.17 However, the entitlement to time away from employment whilst the employment continues also appears designed (subject to the operation of s 5), to serve the more specific purpose of providing 'thorough respite from work for recuperative purposes'.18 That appears from the requirement that leave 'is to be granted and taken' (emphasis added) (s 9(1)), and from the prohibition on alternative employment whilst the employee is on long service leave (s 27(1)). Nevertheless, respite from service is not mandated if the employee and the employer agree, under s 5, for the employee to forgo the long service leave entitlement. In other words, the entitlement may be monetised, but only if it is in the interests of both parties for the employee to forgo the entitlement, and only if the consideration in lieu is 'adequate'.

43 In both its aspects, the entitlement to long service leave is expressed in terms of the 'amount' of leave to which the employee is entitled: s 8(2), s 8(3).

44 A feature of s 8 is the consistent ratio used for calculating an entitlement. At the stipulated leave intervals, the entitlement is, in effect, 0.866 of a week of leave, for every year of continuous service. That feature is manifested in the entitlement of 8^2/3 weeks leave for 10 years of continuous service (s 8(2)(a)), and in the entitlement to 4^1/3 weeks at each 5-year interval thereafter (s 8(2)(b)). It is reflected in pro-rata entitlements available on termination following the first benchmark period of 10 years and each 5-year interval thereafter (s 8(2)(c)). It is also manifested in the pro-rata entitlement available upon termination after at least 7 years but less than 10 years of continuous employment (s 8(3)).

The Agreement

45 The Agreement, according to its terms, applies to, and binds, approximately 210 employees of the Authority. These 210 employees are members, or eligible to be members, of the Australian Rail, Tram and Bus Industry Union of Employees, Western Australian Branch (Union). The Agreement also binds the Authority and the Union. It is a comprehensive agreement of 86 pages, plus five schedules. It includes provisions concerning the contract of employment, the hours to be worked, wages and dispute resolution. It also contains a part relating to leave entitlements. In addition to long service leave, the Agreement provides for a large variety of other forms of approved leave, family leave, cultural and ceremonial leave, blood donor leave, maternity leave, adoption leave, partner leave, study leave, purchased leave and leave without pay. In total there are 21 types of leave under the Agreement, of which long service leave is one.

46 Clause 6.6 of the Agreement provides as follows:

6.6.1. An employee shall be

entitled to thirteen weeks paid long service leave on the completion of ten years continuous service and an additional thirteen weeks paid long service leave for each subsequent period of seven years

of continuous service completed by the employee.

6.6.2. Where a public holiday falls within an employee's period of long service leave such day shall be deemed to be a portion of the long service leave and no other payment or benefit shall apply.

6.6.3. Long service leave may be taken in periods of 4 weeks or more, at a mutually agreed time.

6.6.4. Long service leave shall be paid at the employee's rate of pay as prescribed in the wages clause or as specified for rostered employees.. [sic]

6.6.5. An employee will only be entitled to pro rata long service leave if his or her employment is terminated:

(a)

by the Employer for other than disciplinary reasons

; or

(b) due to the retirement of the employee on the grounds of ill health; or

(d) due to employee's retirement at the age of 55 years or over, provided 12 months continuous service has been completed prior to the day from which the retirement takes effect; or

(e) for the purpose of entering an Invitro Fertilisation Programme, provided the employee has completed three years service and produces written confirmation from an appropriate medical authority of the dates of involvement in the programme; or

(f) due to employees resignation for pregnancy, provided the employee has completed more than three years and produces certification of such pregnancy and the expected date of birth from a legally qualified medical practitioner.

6.6.6. For the purposes of determining long service leave entitlement, the expression 'continuous service' includes any period during which the employee is absent on paid leave but does not include any period exceeding two continuous weeks during which the employee is absent on parental leave or leave without pay.

6.6.7. Continuity of service shall not be broken by the absence of the employee on any form of approved paid leave or by the standing down of an employee under the terms of this Agreement.

6.6.8. The employer may direct an employee to take a long service entitlement that has been accrued for more than 3 years.

6.6.9. Where an employee is directed to take long service leave entitlement, it will be taken within 12 months of the direction, at a time agreed between the employer and the employee.

6.6.10. Where a time cannot be agreed within the 12 month period, the employer will determine the date on which the employee will be required to start long service leave. Provided that the Employer shall give at least 30 days notice to the employee of the day on which the long service leave is to commence. (emphasis added)

47 Employees covered by the terms of the Agreement also have, on specified terms and with the agreement of their employer, the capacity to 'cash out' accrued long service leave under cl 6.7.

Differences between the LSL Act and the Agreement

48 The following differences, at least, may be observed between the LSL Act and the Agreement.

49 Prior to the 7-year mark of completed continuous employment, the LSL Act provides for no long service leave entitlement if the person's employment is terminated. The Agreement under cl 6.6.5, on the other hand, provides persons in certain circumstances with a pro-rata long service leave. The pro-rata rate is 1.3 weeks per year of continuous service. Clause 6.6.5 includes a provision concerning the circumstance where the employment is terminated by the employer, for other than disciplinary reasons.

50 After 7 years of continuous employment, the LSL Act provides a pro-rata entitlement upon termination (other than for serious misconduct) on the basis of 0.866 weeks per year of continuous employment. This increases the scope for entitlement beyond that under cl 6.6.5 of the Agreement, in that unlike the Agreement, it operates where the employee has resigned from his or her employment. But it applies a lower rate of leave per year of service and, unlike the Agreement, it can have no operation during the first 7 years of employment.

51 At 10 years, the Agreement provides for 13 weeks long service leave, compared with 8^2/3 weeks under the LSL Act.

52 With respect to the position where employment is terminated after 10 years and prior to 17 years continuous service, under the Agreement the cl 6.6.5 benefits continue to apply at the rate of 1.3 weeks per year of continuous service. The LSL Act in relation to payment in lieu continues with its broader scope for application, but at the lower rate of 0.866 weeks per year of continuous employment completed since the employee last became entitled under the LSL Act to an amount of long service leave. As noted above, at 10 years that entitlement is only 8^2/3 weeks under the LSL Act, but is 13 weeks under the Agreement.

53 Under the LSL Act, at the completion of the 15-year mark, the employee will have accrued, overall, 13 weeks leave, being 8^2/3 weeks after 10 years, and 4^1/3 weeks after the completion of the next 5 years. In other words, under the Agreement it takes 10 years to accrue 13 weeks long service leave, whereas it takes 15 years to accrue the same amount of long service leave under the LSL Act.

54 Under the LSL Act, the overall leave entitlement at the completion of 17 years of service stands at 14.732 weeks (13 weeks at 15 years plus 0.866 weeks multiplied by 2 years), whereas under the Agreement it is 26 weeks (13 weeks at 10 years, plus another 13 weeks at 17 years). Under the LSL Act the leave cannot yet be taken at the 17-year mark.

55 Generally under the LSL Act, the rate used for the purpose of calculating long service leave, including after year 17, is 0.866 weeks per year. Under the Agreement, for each 7 years additional service after 10 years, the effective rate is 1.857 weeks per year of service, which is approximately double the rate under the LSL Act.

The proper construction of s 4(3) of the LSL Act

56 The general principles of statutory construction were not in contest. They have been set out, relatively recently, by the Court of Appeal in, eg, City of Kwinana v Lamont19 and Director General of Department of Transport v McKenzie.20 Ms Yoon also relied upon the principle that remedial legislation should be construed beneficially. That principle, where it applies, requires that the provision in question be construed so as to give the fullest relief which the fair meaning of its language will allow, but not that its true signification should be strained or exceeded: Bull v Attorney-General (NSW);21Khoury v Government Insurance Office (NSW).22 The court is not at liberty to give the provision a construction that is unreasonable or unnatural: IW v City of Perth.23 Further, in Victims Compensation Fund Corporation v Brown24 it was said that to commence the process of construction by posing the type of construction to be afforded - liberal, broad or narrow - may obscure the essential question regarding the meaning of the words used in the text.

57 In this case, the task of construction concerns the meaning of s 4(3) of the LSL Act. The following observations may be made. First, what is to be compared under s 4(3) is a person's entitlement, or eligibility to become entitled, to long service leave 'by virtue' of an award, industrial agreement, statutory instrument etc, with the 'entitlement' to long service leave under the LSL Act. It invites attention to the provisions of the respective instruments for comparison purposes. Secondly, the words 'a person' do not, in this context, direct attention to the personal circumstances of an individual in the course of their employment history. The words 'a person' in s 4(3) are to be read in the context of s 4(1), which defines (subject to subsection (3)) an employee as being 'any person' falling within certain broadly stated categories of person. Section 4(3) involves the identification of a person by reference to their entitlement, or eligibility to become entitled, to long service leave under another instrument. This identification effectively creates its own class of persons who fall outside of the s 4(1) categories of 'employee'. Also, it is difficult to see that the focus of s 4(3) is on the circumstances of 'the person making the claim' (as Ms Yoon submitted), when s 4(3) refers to 'a person' without the added complexion of such a person being in the position of a claimant, asserting an existing right.

58 Thirdly, the words 'entitled to, or eligible to become entitled to' in s 4(3) require consideration. They appear to be a vestige of the language of exclusion in the former version of the LSL Act, which referred to the person not being an employee 'if and while the person is entitled, or eligible to become entitled, to long service leave [elsewhere]' (emphasis added). The words in question are contained within that part of s 4(3) which provides 'a person is, by virtue of [another instrument] entitled to, or eligible to become entitled to, long service leave'.

59 These words are to be read in the context of s 4(3) and the LSL Act as a whole, including s 8 and s 9. The words 'entitled to, or eligible to become entitled to' form a composite phrase upon which, as a whole, the preceding words operate. The preceding words are 'a person' who is 'by virtue of [an agreement] …'. Read as a whole, and in this context, it appears to be used as an expansive phrase to comprehend an actual or contingent entitlement under another instrument, irrespective of whether it has accrued, or has not yet accrued. In other words, in its context, the phrase appears to be a comprehensive one used by the legislature to refer to an actual or contingent entitlement which any person has under another instrument to long service leave, irrespective of whether it has been accrued or not. Accordingly, it indicates that the comparison required by s 4(3) does not have its focus on the individual's employment history from time to time (as the comparison is to be undertaken irrespective of any accrual of entitlement), but, rather, on the person's entitlement as appears from the terms of the two respective instruments (the LSL Act and the other instrument).

60 Fourthly, the use of the definite article in the phrase 'the entitlement to long service leave under this Act' suggests that s 4(3) is intended to operate on the basis that the LSL Act provides for a comprehensive entitlement, albeit comprising successive specific entitlements or benefits with increasing longevity of service. That is consistent with the structure of s 8, under which s 8(1) provides that an employee 'is entitled in accordance with, and subject to, the provisions of this Act, to long service leave'. The specific entitlements or benefits which make up 'the entitlement to long service leave under' the LSL Act are specified in s 8(2) and s 8(3). The words '[t]he entitlement' with respect to leave under the LSL Act, also appear in s 7(3), discussed below.

61 The foregoing considerations indicate that the comparison required by s 4(3) is to be made prospectively by reference to the terms of the respective instruments, rather than from time to time during the course of the employment history of a particular employee. That construction is confirmed by a consideration of s 7 of the LSL Act.

62 As noted earlier, s 7(3) provides:

63 In other words, where the s 4(3) comparison results in the person being an 'employee' for the purposes of the LSL Act, and thereby entitled to leave under the LSL Act, '[t]he entitlement' under the LSL Act applies in substitution for, and satisfaction of, 'any' long service leave entitlement under the other instrument. There appears to be no dual operation intended. Section 7(1) is complemented by s 7(2), which refers to the grant of leave 'under any long service leave scheme and irrespective of this Act' (emphasis added). The effect of s 7(2) is that where, by virtue of s 4(3), the LSL Act applies, but, in fact, there has been a grant of leave (or a payment in lieu) under any other long service leave 'scheme', then that is taken into account in calculating the employee's entitlement to long service leave under the LSL Act as if it were long service leave taken (or payment in lieu made) under the LSL Act. Sections 7(2) and (3) indicate that when the statutory entitlement applies, it applies to the exclusion of the scheme under the other instrument. In other words, it appears that the legislature did not (objectively) intend that the two schemes should operate in tandem. On that basis, there could be no prospect of any doubling-up between the two.

64 That conclusion tends to be confirmed by reference to the long title to the LSL Act. The expression 'the granting of long service leave to certain Western Australian employees' denotes the provision of statutory long service leave to some employees only. Ms Yoon's approach to construction suggests an enactment of a different character. On Ms Yoon's approach, statutory long service leave is provided to virtually all employees (having regard to the breadth of the definition) in order, effectively, to 'top up' aspects of their existing benefits from time to time over the course of their working lives.

65 The following observations in Kennedy are also pertinent in this context, notwithstanding certain differences in the statutory language. In Kennedy, the Commission was dealing with a submission that an employee whose industrial agreement provided for long service leave was nevertheless entitled to a particular long service leave benefit included in the relevant NSW legislation (certain payment in lieu), which was not included in her industrial agreement. The submission was made in the context of a provision which precluded the application of the long service entitlement provided by the statute where there was an award or an industrial agreement 'with provisions … more favourable to the worker than those' under the relevant statute. The Commission said:

In effect, the submission of … the complainant, is that the overriding intention of the Act is that no worker shall in any circumstances be entitled to long service leave benefits which are less favourable than those provided in the Act. It was submitted that each individual case must be considered at the point of time when, if s 4 [the conferral of the statutory entitlement] were applicable, some benefit under it would arise. If, at this time, the Act provides a more favourable benefit than the industrial agreement, the Act must prevail and that benefit must be granted irrespective of the provisions of the agreement. This involves a submission that, except in a stage of his service when the agreement is more favourable, the worker is no part of a class for which more favourable provisions have been made.

This means that individual workers may move backward and forward between the Act and the agreement according to relative favourableness at many different points of time. This is surely unrealistic when it is remembered that provisions for long service leave in industrial agreements, awards and Acts of Parliament contain composite schemes covering the whole range of employment

. In fact, the word 'scheme' is used in the Act (s 5(2)(a)) to describe similar arrangements by employers which may be exempted (457). (emphasis added)

66 The above reasons would suggest that the first of the two constructional issues referred to in [9] above should be resolved in favour of the Authority, subject to a consideration of the second issue below.

67 The second issue raises a question as to how the comparison is to be made under s 4(3). It may be accepted that there is some force in Ms Yoon's contention concerning the difficulties which may arise in the application of s 4(3) if the comparison is not made by reference to the individual circumstances of the person at various times in their working life. Ms Yoon's construction would no doubt make the task of comparison easier in one sense, although the degree of difficulty in any prospective comparison would, of course, vary depending upon the terms of the other instrument. Further, as the Authority submitted, Ms Yoon's construction produces its own potential difficulties in the application of the LSL Act.

68 If one were to look at the position under the Agreement compared with the position under the LSL Act (as both parties suggested for illustration purposes), prima facie, Ms Yoon's approach would have the following result. An employee, after 10 years continuous service, would be entitled to 13 weeks long service leave under the Agreement. After a further 5 years continuous service, the employee would be entitled, under the LSL Act, to take a further 4^1/3 weeks, given that there is no long service leave entitlement at the 15-year mark under the Agreement. Two years later, after 17 years continuous service, the employee would be entitled, under the Agreement, to a further 13 weeks long service leave.

69 Nevertheless, Ms Yoon contended that this would not be the consequence of her construction, and adopted the reasoning of Beech CC in that regard. Beech CC25 said that in such a case, the person would not be an 'employee' within the meaning of the LSL Act at the 15-year service mark. That is because, at that point, the employee was 'eligible to become entitled' to a further 13 weeks after only 2 more years continuous service. In other words, the person is 'eligible to become entitled' under the Agreement to long service leave, at least equivalent to the 4^1/3 weeks given by the LSL Act at year 15, because of the future entitlement to 13 weeks at the end of year 17 under the Agreement.

70 Two observations may be made about Beech CC's reasoning on this point. The first is that it involves a prospective comparison, at least at the point of the 15-year service mark, with the difficulties inherent in any prospective exercise. It is, in substance, inconsistent with the underlying hypothesis that s 4(3) requires a comparison based on the person's employment history as it exists at the time that they make a claim for long service leave entitlement for the purpose of identifying any accrued rights they may then have under either instrument. The second is that it is implicit, in the reasons of Beech CC as a whole, that the words 'eligible to become entitled to' long service leave in s 4(3) have a prospective operation in relation to an entitlement to days off, but not in relation to payment in lieu on termination. If the person resigned after 15 years, the person would, at that point, receive payment in lieu of 4^1/3 weeks, even though they would not be entitled to take that amount of leave. It is, however, difficult to see that the LSL Act is, objectively, intended to operate differentially between the two types of long service leave entitlement.

71 Whilst the parties' references to the Agreement serve to illustrate the competing constructions of the LSL Act for which they contended, ultimately, of course, the difficulties (or otherwise) in comparing the long service leave entitlement under the Agreement with the long service leave entitlement under the LSL Act, are irrelevant to the proper construction of the LSL Act. The construction is to be determined in accordance with the principles referred to earlier in these reasons.

72 Ultimately, the potential for difficulties associated with the Authority's suggested construction does not seem to weigh so greatly as to require a different conclusion from that suggested above in relation to the resolution of the first issue. The word 'equivalent' ordinarily means equal in value, measure, effect or significance.26 The task of identifying whether there is at least equivalence between the two instruments is necessarily a broad and evaluative one involving the overall weighing of the benefits provided under the two respective instruments. The evaluation is to be undertaken having regard to the objectives of the LSL Act, referred to in [42] above.

73 That conclusion is confirmed by, but not dependent upon, the further observation that a legislative intention that a comparison be undertaken prospectively between a legislative entitlement to long service leave on the one hand, and an entitlement under an award or industrial agreement on the other, is not a novel one, as the decision in Kennedy indicates. In Kennedy, the Commission observed:27

As this comparison has to be made without advance knowledge of how particular individuals may fare ultimately in their employment, it must be based on an estimate of what is likely to be best for the majority of individuals involved - in other words, on the principle of the greatest good for the greatest number. The only way to do this is to examine each set of provisions as a whole, weighing the various pros and cons and arriving at a final balance on an overall basis. This means that the workers have to be considered as a group over the whole range of their possible employment. This may involve speculation often on imprecise material but, in the end, the answer must be 'Yes' or 'No'. To answer 'Yes and No' is not permissible.

74 The approach taken in Kennedy has been applied, relatively recently, in, for example, New South Wales Nurses' Association v Ramsay Health Care Australia Pty Ltd.28 In that case, the relevant union sought a determination as to the proper construction of an award. The employer raised a jurisdictional issue as to whether the entitlement to long service leave contained in the award applied exclusively to the relevant employees, or whether the employees' legal entitlement to long service leave was to be ascertained by reference both to the award and the entitlement provided for in the Long Service Leave Act 1955 (NSW) (NSW LSL Act). In what was, in substance, a reversal of the roles taken in this appeal, the union contended that the employees had an entitlement under the award only, and not an entitlement through the combined operation of the award and the NSW LSL Act. The employer took the contrary position.29 The court resolved that issue in favour of the union by applying the observations in Kennedy.30

75 The second issue should also be resolved in favour of the Authority.

76 A different conclusion is not warranted by reference to the principles with respect to the construction of beneficial legislation referred to earlier. The LSL Act is not intended to confer an entitlement to long service leave in any circumstances where, by virtue of another instrument, a person has at least the equivalent entitlement to long service leave. The question is what does the statutory language of s 4(3) mean in that regard. The construction advanced by Ms Yoon is not, in light of the foregoing considerations, one which is reasonably open. The mere fact that, in the events which have happened, the LSL Act may not apply to Ms Yoon (or someone in her position) does not mean that the preferred construction does not give the statute the fullest scope for operation as beneficial legislation which its terms allow.

77 Finally, at the hearing of the appeal, senior counsel for the Authority sought to rely on a document entitled 'Industrial Relations Legislation Amendment and Repeal Bill 1995 Explanatory Notes (Notes)'. Page 28 of the Notes referred to cl 54 of the Amendment Act, which was the clause that introduced s 4(3) into the LSL Act. Senior counsel for the Authority submitted that the Notes showed that there is 'nothing … that supports the kind of construction determined by [the Full Bench] in this case'.31 Counsel for Ms Yoon contended that the Notes were not admissible on the question of construction.32 In particular, counsel referred to a statement at the foot of each page in the Notes, which stated:

These Explanatory Notes on the Industrial Relations Legislation Amendment and Repeal Bill 1995 have been prepared by the Department of Productivity and Labour Relations as a general aid to understanding the Bill and its relationship with other industrial legislation. These Notes are not part of the Bill and should not be used to interpret any provision of the legislation.

78 It is unnecessary for present purposes to determine its admissibility, because even if the material could be considered, it sheds no light on the proper construction of s 4(3) of the LSL Act.

Conclusion

79 The Authority has established its ground of appeal. There has been an error in the construction of the LSL Act by the Full Bench. The error leads to injustice to the Authority, and there is no occasion to confirm the decision, notwithstanding the error, under s 90(3a) of the Industrial Relations Act 1979 (WA).

80 The appeal should be allowed. The Full Bench's decision should be set aside. The Full Bench has failed to address the relevant issue on the true construction of the relevant legislation. As the Full Bench is a specialist tribunal and as this court has not had the benefit of full submissions on whether Ms Yoon's entitlement under the Agreement is at least equivalent to her entitlement under the LSL Act on its proper construction, the matter should be remitted to the Full Bench for further hearing and determination according to law, pursuant to s 90(3) of the Industrial Relations Act.

81 KENNETH MARTIN J: I have had the advantage of reading the draft reasons of Buss and Murphy JJ. I am in agreement with all that their Honours have written, save as regards remitting of the matter back to the Full Bench for a further hearing. I do not, with respect, favour that course.

82 By my assessment, this court may, by s 90(3) of the Industrial Relations Act 1979, 'reverse' the Full Bench's decision and by that route allow (rather than dismiss) the appeal to the Full Bench which was taken by the PTA against the first instance decision of Cicchini IM - thereby setting aside the payment order which he made to Ms Yoon of $6,108.82 and, in lieu, rejecting her payment claim in its entirety.

83 By my assessment, the above course, rather than that of a remittal, should be taken, since it is clear to me that objectively assessed at the commencement of the industrial agreement applicable to her employment, Ms Yoon's position as an employee under the terms of the Public Transport Authority Railway Employees (Transperth Train Operators) Industrial Agreement 2011 is, for the purposes of s 4(3) of the Long Service Leave Act 1958 (WA) (LSL Act), 'at least equivalent to' any entitlement to long service leave that Ms Yoon might otherwise have enjoyed as an employee under the LSL Act.

84 By my assessment, there are only two possible areas where it might be argued by Ms Yoon that her overall long service leave position under the 2011 industrial agreement, is not at least equivalent to the position under the LSL Act.

85 First, it might be argued that an enjoyment of a second tranche of long service paid holidays after 15 years of continuous employment under the LSL Act, is superior to the position than under the 2011 industrial agreement - where the second tranche of long service leave holidays is enjoyed after 17 (not 15) years of continuous service.

86 However, the first argument is not ultimately persuasive, once it is appreciated that under the LSL Act, an employee's first and second tranches of paid holidays, when they are reached after 15 years of continuous service, will, if added, only amount then to (8 2/3 + 4 1/3 weeks) 13 weeks paid long service holidays.

87 But that same amount of long service leave (ie, 13 weeks of paid holidays) by contrast, is earlier reached to then be enjoyed by the employee regulated under the 2011 industrial agreement. Their first tranche of 13 weeks long service leave entitlement is available after only 10 years of continuous service. The employee under the 2011 industrial agreement then has the opportunity to reach and enjoy (13 + 13) 26 weeks of aggregated paid holidays, upon seventeen (17) years of continuous service. At 15 years of continuous service the employee regulated by the 2011 industrial agreement has earlier reached (at 10 years) the entitlement of 13 weeks paid long service leave and is then only two years away from being entitled to another 13 weeks of paid leave.

88 Hence, the overall aggregated amounts of long service holidays capable of being reached under the 2011 industrial agreement, viewed overall, are superior to the periods of holidays achievable under the LSL Act.

89 A second possible argument favouring the LSL Act over the 2011 industrial agreement that might be made, would be to the benefit of the broader coverage scope of the circumstances open under the LSL Act to receive pro rata payments in lieu of long service leave not taken, following a termination of the employment relationship - being a termination effected at the behest of the employee.

90 A voluntarily terminating employee's pro rata hypothetical payment in lieu position under the LSL Act is to be assessed by reference to either s 8(2)(c)(ii) or by s 8(3)(b).

91 The payment in lieu regime of the LSL Act may be argued to be superior to what is a less plenary termination payment in lieu coverage of the 2011 industrial agreement. This is because for the employee under the 2011 industrial agreement to be entitled to receive a pro rata payout payment via cl 6.6.5, the employee needs, in all cases, to first meet one of six (6) nominated cl 6.6.5 situations ((a) to (f)), to be eligible to receive a pro rata payment in lieu of long service leave not taken at the time of the employment termination.

92 Two of the six scenarios (ie, employer dismissal for other than disciplinary reasons and a death of the employee) are broadly analogous to the coverage of the LSL Act.

93 But the remaining four specified cl 6.6.5 situations in aggregate can be seen to be less expansive in their pro rata payment in lieu entitlement coverage, in contrast to the LSL Act's payment in lieu criteria of 'any circumstances' otherwise than employer dismissal for 'serious misconduct' - as the LSL Act specifies under s 8(2)(c)(ii) (after 10 years of continuous employment), or by s 8(3)(b) (after seven years of continuous employment 'for any reason other than serious misconduct').

94 But effectively counterbalancing any objectively perceived initial superiority in the pro rata long service leave payment position of the LSL Act over the 2011 industrial agreement are, in my view, the following rival considerations, all favouring the 2011 industrial agreement over the LSL Act:

(a) Under the 2011 industrial agreement there is no required (seven year, ten year, or otherwise) minimum qualifying period of continuous service needed by an employee, in order for them to be eligible to receive a pro rata payout at their termination, in respect of long service leave not taken at that time. Eligibility arises, provided they can meet one or other of the six specified scenarios under cl 6.6.5, immediately following a commencement of the employment relationship. Hypothetically then, the employee under the 2011 industrial agreement could be eligible for a pro rata termination payout in year two of their employment.

(b) Under the 2011 industrial agreement the quantitative amount of the pro rata money payout in lieu calculation for a terminated employee (who is within cl 6.5.5) starts from a higher monetary base, for the amount of paid long service holiday leave enjoyed post 10 years of continuous service - namely, from the higher base of 13 weeks (not 8 2/3 weeks as per the 10 year entitlement of the LSL Act) paid holiday leave that is available after 10 years of service. The 2011 industrial agreement termination pro rata payout position is calculated on a higher and therefore superior base of 13 weeks paid holiday leave.

By illustration, at seven years of continuous service, the terminating employee under the LSL Act would, at that point, have enlivened a potential eligibility for a termination pro rata monetary payout, calculated at the worth of 70% of 8 2/3 weeks paid leave. In contrast, the same employee governed by the 2011 industrial agreement (if eligible by meeting one of the six situations open under cl 6.6.5) would enjoy a higher pro rata payment in lieu of long service leave calculated at the worth of 70% of 13 weeks (not 8 2/3 weeks) of paid holidays.

(c) The voluntary termination scenarios specified under cl 6.6.5 as (c) (employee termination for ill health), (d) (retirement at age 55 following a minimum of 12 months' continuous service), (e) (retirement for a purpose of entering into an in vitro fertilisation programme), and (f) (resignation for reason of pregnancy), are all seen to reflect what must be the negotiated termination coverage bargain outcomes, reached no doubt by reason of a specific industry sector utility for those chosen termination situations, to the 2011 industrial agreement's cohort of employees. The utility of a tailored termination pro rata payment in lieu coverage to meet chosen situations on a bespoken basis, is a positive factor to be weighed favouring the 2011 industrial agreement over the LSL Act.

(d) The 2011 industrial agreement, as regards pro rata termination payments in lieu of long service leave not taken, displays the underlying, industry sector objective of encouraging covered employees to actually take their long service paid holidays close to after the entitlement accrues, that is, first at post ten (10) years of continuous service and then at subsequent seven-year intervals of continuous service.

95 Clause 6.6.5 of the 2011 industrial agreement reflects a workplace objective. Rather than incentivising, as the LSL Act might be assessed to do, a pursuit of lump sum termination amounts in lieu of long service leave not taken by the time of a voluntary termination, the 2011 industrial agreement provides for greater periods of leave, but it then narrows the range of pro rata payment in lieu opportunities.

96 Pro rata lump sums in lieu of long service leave not taken are only available under the 2011 industrial agreement to meet the six chosen termination scenarios, as negotiated. Outside those six specified situations, however, an overall industry sector workplace welfare policy of the 2011 industrial agreement is clear. A covered employee either takes their accrued long service holidays as they are earned, or possibly risks losing them if they are not taken. It is legitimate for an industry sector to incentivise its workforce by a negotiated outcome to actually take their long service leave paid holidays as they accrue as an overall reasonable welfare objective.

97 Taking those counterbalancing factors into account as regards the second argument, it is not established that the pro rata in lieu long service leave eligibility position for the employee under the 2011 agreement, objectively assessed at 2011 when the industrial agreement took effect, is worse than the LSL Act. The employee is in a position for pro rata payments in lieu under the 2011 industrial agreement, overall, to at least equivalent to the position of the employee - as regards eligibility for a pro rata termination payout of long service leave not taken under the LSL Act.

98 Aside from those two rejected arguments for the superiority of the LSL Act over the 2011 industrial agreement now discussed, no other comparative factor considerations present towards supporting the contention that the overall long service leave entitlement position under the 2011 industrial agreement objectively assessed at 2011, was not at least equivalent to the entitlement position under the LSL Act. The long service leave regimes are different. But it simply cannot be rationally contended, taking a broad pragmatic view of all the long service related benefits, namely holidays as well as payments in lieu, as one aggregate package of rival long service leave entitlements, that an employee under the LSL Act is in an any better overall long service leave entitlement position than under the 2011 industrial agreement. Each has its attractions and its positive and negative features. But overall, there is no proven lack of equivalence in the package of benefits viewed comparatively as a whole.

99 On an objective comparison approach, taking an holistic view of all eligibilities to enjoy all long service leave related entitlements under both regimes, does not deliver a persuasive comparative conclusion that the long service leave benefits available to a person covered by the 2011 industrial agreement are, overall, not at least equivalent to those long service leave benefits afforded to employees by the LSL Act.

100 The only basis by which an opposing conclusion as to a superiority of the overall benefits under the LSL Act can be reached (in way of a s 4(3) LSL Act comparison), is by taking a wholly confined and subjective view of Ms Yoon's personal position, temporally focused solely and specifically at the time of her voluntary retirement, at seven years and three months into her employment with the PTA, then conducting a subjective outcomes assessment towards just one aspect of all her long service benefits under the 2011 industrial agreement, namely her pro rata long service payment at that particular time - on a basis that she then in her personal situation did not meet any of the cl 6.6.5 situations. Such a comparison approach is wrong in concept, as the joint reasons have explained. It is neither feasible nor warranted by the terms of s 4(3) of the LSL Act, in my view.

101 By my assessment then, this appeal must be allowed and the decision of the Full Bench reversed, with the consequence that the PTA's appeal against the first instance decision of Cicchini IM is then allowed and with the allied consequence that the payment order for $6,108.82 favouring Ms Yoon be set aside, with her application consequently dismissed.

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1Public Transport Authority of Western Australia v Yoon [2015] WAIRC 00918.
2Yoon v Public Transport Authority of Western Australia [2015] WAIRC 00411.
3 Presumably, on the Authority's approach, the comparative exercise would need to be re-done if the other instrument were subsequently materially amended.
4 Ms Yoon's written submissions, par 19.
5 See Ms Yoon's written submissions, pars 21 - 23.
6 Full Bench decision [14].
7 Full Bench decision [34].
8 Full Bench decision [50], [57].
9 Full Bench decision [65] - [68].
10 Full Bench decision [91].
11 The LSL Act as it stood at the date of the Agreement.
12 Section 6(2)(i) of the LSL Act.
13 Full Bench decision [85] - [86].
14 Appeal ts 16.
15 In the language of Barwick CJ in Nilsen Development Laboratories Proprietary Limited v The Federal Commissioner of Taxation of the Commonwealth of Australia [1981] HCA 6; (1981) 144 CLR 616, 624.
16Collins v Charles Marshall Proprietary Limited [1955] HCA 44; (1955) 92 CLR 529, 551.
17Kennedy v Board of Fire Commissioners [1967] AR 455, 456.
18 In the language of Williams J in The Queen v Hamilton Knight; Ex parte The Commonwealth Steamship Owners Association [1952] HCA 38; (1952) 86 CLR 283, 303, albeit with respect to 'annual or other periodical leave'. See also Re Municipal Officers (New South Wales Electricity Undertakings) Long Service Leave Award, 1970 (1973) 148 CAR 917, 919.
19City of Kwinana v Lamont [2014] WASCA 112; (2014) 201 LGERA 334 [47].
20Director General of Department of Transport v McKenzie [2016] WASCA 147 [45] - [48].
21Bull v Attorney-General (NSW) [1913] HCA 60; (1913) 17 CLR 370, 384.
22Khoury v Government Insurance Office (NSW) [1984] HCA 55; (1984) 165 CLR 622, 638.
23IW v City of Perth [1997] HCA 30; (1997) 191 CLR 1, 12.
24Victims Compensation Fund Corporation v Brown [2003] HCA 54; (2003) 77 ALJR 1797 [33]; New South Wales Aboriginal Land Council v Minister Administering the Crown Lands Act [2016] HCA 50 [33].
25 Full Bench reasons [71].
26Macquarie Online Dictionary.
27Kennedy (459).
28New South Wales Nurses' Association v Ramsay Health Care Australia Pty Ltd [2009] FMCA 579; (2009) 185 IR 1.
29New South Wales Nurses' Association [56] - [58], [61] - [64], [79] - [81], [89] - [91].
30New South Wales Nurses' Association [98] - [102].
31 Appeal ts 8 - 9.
32 Appeal ts 8, 38 - 39.