R v Gough; Ex parte

[1969] HCA 71

HIGH COURT OF AUSTRALIA

Barwick C.J., Menzies, Windeyer, Owen and Walsh JJ.

REG. V. GOUGH; Ex parte MEAT AND ALLIED TRADES FEDERATION OF AUSTRALIA

(1969) 122 CLR 237

22 December 1969

Constitutional Law (Cth)

Constitutional Law (Cth)—Conciliation and Arbitration—Industrial arbitration—Award—Validity—Judicial power—Arbitral power—Limitation in award of employer's right to dismiss employee—Whether Commonwealth Conciliation and Arbitration Commission may reserve power to direct reinstatement of employee in case of dispute—The Constitution (63 &64 Vict. c. 12), s. 51 (xxxv.)—Conciliation and Arbitration Act 1904-1969 (Cth), ss. 23, 32, 41.

Decisions

December 22.
The following written judgments were delivered : -
BARWICK C.J. The question raised by this application for prohibition is whether the Commonwealth Conciliation and Arbitration Commission is competent to insert in a federal award the second paragraph of a clause in the following terms :

"An employer shall not give notice of termination of employment to a weekly employee or refuse to re-engage a regular daily employee or refuse to re-employ any person employed by him in the preceding twelve (12) months or dismiss an employee without notice harshly or unreasonably. If any dispute arises under this Clause the Commission may on the Application of the Union order the reinstatement in employment or re-engagement or re-employment of any such employee." (at p240)

2. There is no question that a clause confined to the terms of the first paragraph would be within the ambit of a dispute initiated by the logs of claims in evidence in this matter or that the Commission could award it in settlement of such dispute. It appears to provide that an employer bound by the award shall not dismiss a weekly employee with or without notice harshly or unreasonably or refuse harshly or unreasonably to re-engage a regular daily employee or refuse harshly or unreasonably to re-employ any person employed by him in the preceding twelve months. (at p240)

3. If such a provision is awarded, it will impose legal restraints upon the employer's freedom of action and confer commensurate rights on his employees or former employees. The extent of these restraints and rights will be determined by the construction placed upon the words used in expressing the provision. (at p240)

4. The second paragraph of the clause purports to authorize the Commission to settle disputes arising "under this clause" by ordering the reinstatement in employment or re-engagement or re-employment of an employee or former employee. The employee with respect to whom such an order may be made is described as "any such employee" which, in my opinion, necessarily means an employee whose rights created by the first paragraph of the clause have been violated : he must be a weekly employee dismissed whether upon notice or not, in circumstances which were in fact harsh or unreasonable, or he must be a person who had been a regular daily employee of the particular employer and who had been refused re-engagement in circumstances which made such refusal in fact harsh or unreasonable or a person who in the preceding twelve months had been employed by the particular employer and who had been refused re-employment in circumstances which made such refusal harsh or unreasonable. (at p241)

5. However, although an order may only be made in respect of any such employee the dispute in settlement of which it may be made is not in the terms limited to a dispute as to whether or not the rights granted to such employee by the first paragraph of the clause have been violated. But, on any view of the second paragraph, such a dispute must be comprehended in its operation. To determine such a dispute is clearly not an arbitral but a judicial function. It is the ascertainment and enforcement of existing rights, classically at the very heart of the exercise of judicial power. Whether or not there may be disputes arising under the first paragraph of the clause which do not involve the determination of existing rights - and I confess that as at present advised, bearing in mind the reference to any such employee I cannot conceive of any - the purported inclusion of the provision in the Commission to determine legal rights and afford a remedy for the breach of them is enough, in my opinion, to deny validity to that paragraph. (at p241)

6. Accordingly on this ground alone I would make absolute the order for prohibition. (at p241)

MENZIES J. The clause which the Commission has decided that it has power to include in the Federal Meat Industry Interim Award 1965 as part of the settlement of an existing industrial dispute is as follows :

"An employer shall not give notice of termination of employment to a weekly employee or refuse to re-engage a regular daily employee or refuse to re-employ any person employed by him in the preceding twelve (12) months or dismiss an employee without notice harshly or unreasonably. If any dispute arises under this Clause the Commission may on the Application of the Union order the reinstatement in employment or re-engagement or re-employment of any such employee." (at p241)

2. The prosecutor claims that the Commission has no power to make an award including the second part of this clause. (at p241)

3. Before considering whether the Commission has the power in question, it is necessary to decide what the proposed clause, as a whole, means. (at p242)

4. The first part of the clause forbids an employer to do certain things harshly or unreasonably. All kinds of disputes could arise whether or not an employer has acted in breach of this provision. For instance, there could be a dispute whether or not an employer had dismissed an employee or that he had acted harshly or unreasonably or that a worker, whom he had refused to re-employ, had been employed by him in the preceding twelve months. (at p242)

5. The second part of the clause is expressed to operate if any such dispute arises. A dispute bringing the second part into operation would obviously be between the employer and the worker claiming the right to work and asserting his willingness to work as an employee of that employer. In the event of such a dispute arising the union can make an application for an order for reinstatement or re-engagement or re-employment as the case may be "of any such employee". The clause purports to give the Commission the power to make the order sought. (at p242)

6. Independently of the second part of the proposed clause an employer acting in breach of the first part of the clause - the making of which is not in question - would be subject to proceedings in court under ss. 119 and 122 of the Act. The Industrial Court could also, in an appropriate case, order compliance with the award by virtue of s. 109 of the Act. (at p242)

7. As I have already observed, the condition for the hearing of an application under the second part of the proposed clause is simply that a dispute has arisen under the clause. However, although it is not provided in terms that an order may be made only if it be established that an employer is in breach of the clause, the reference at the end to "any such employee" means that an order could be made only if it were to be established that the employee to be reinstated, re-engaged or re-employed was an employee in respect of whom the employer had contravened the first part of the clause. The course of events would, therefore, be a dispute between an employer and an employee, an application to the Commission by the union, a hearing by the Commission, and an order, if the Commission should be satisfied that the employer was in breach of the clause. (at p242)

8. In my opinion the Commission cannot take the power which the proposed clause would confer. An instance will reveal how far the clause goes. An employer, a party to the award, gives a notice of termination to an employee at its works in Sydney. The employee claims to be a weekly employee and that the notice was given harshly. The employer disputes that the employee was a weekly employee. The union makes an application to the Commission. The Commission decides that the employee was a weekly employee, that the notice was given harshly, and makes an order for reinstatement. The employer does not comply with that order. Proceedings are taken in the Industrial Court to order compliance with the order and the making of the order by the Commission, and its non-observance by the employer, are proved. An attempt by the employer to prove that the employee in question was not a weekly employee is met by s. 60 of the Act. Thereupon an order for compliance is made and the employer, if he disobeys, is liable to proceedings for contempt under s. 111 of the Act. (at p243)

9. It is apparent to me that the order of the Commission, made in these circumstances and with the consequences stated, would not be an award made in settlement of an industrial dispute extending beyond the limits of the State. Rather, it would be an order, enforcing the terms of an award already made, whereby an employer is prohibited from giving notice of termination of employment to a weekly employee. I do not see how a dispute between an employer and an employee at Sydney about whether or not the employee is a weekly employee could become part of a preceding industrial dispute extending beyond the limits of the State and in respect of which an award has been made. Nor do I understand how the Commission's determination that a particular employee of a particular employer was a weekly employee and is therefore to be reinstated, can be regarded as an exercise of arbitral power. Such an order cannot be regarded otherwise than as a step in the enforcement against one employer of an existing award of the Commission. It is not, I think, necessary to decide whether or not the making of an order under the proposed clause would be an assumption of judicial power ; it is sufficient to say that it is not an exercise of arbitral power. It is a step in the enforcement of the award and it is open to the objection to which I referred in Reg. v. Commonwealth Conciliation and Arbitration Commission ; Ex parte Melbourne and Metropolitan Tramways Board (1965) 113 CLR 228, at p 256 , viz. :

"The Commission cannot, by making an award, . . . give itself power to make orders for the settlement of local disputes (arising between parties to the award)." (at p243)

10. It was argued that the second part of the proposed clause is of the same character as a bans clause and may be inserted in an award to protect the settlement effected thereby. It seems to me that there is little resemblance between a bans clause and the provision now under consideration. I have already set out the action that this provision would empower the Commission to take. By inserting a bans clause the Commission does not take power to determine for itself whether there has been a contravention of the award by a party thereto and, in the event of an affirmative decision, to make a specific order for compliance against that party as a step in the enforcement of the award. A bans clause is the making of a rule by an arbitrator. This clause is the taking by the Commission of power which is not arbitral. (at p244)

11. Accordingly, it is my opinion that, were the Commission to include in the award a provision such as the second part of the clause in question, it would be acting outside its power to make an award in settlement of an industrial dispute. (at p244)

12. Prohibition should, therefore, go now. (at p244)

WINDEYER J. In order to decide the matter before us it is necessary to know first how the proposed clause is to be understood. Unfortunately clarity has been sacrificed by the draftsman in the interest of brevity. The first paragraph suffers from the ambiguous placing of the words "harshly or unreasonably". However, counsel agreed that these adverbs qualified all the preceding verbs, not only their immediate antecedent. This paragraph is therefore, I take it, to be read as follows : An employer shall not harshly or unreasonably (a) give notice of termination of employment to a weekly employee ; or (b) refuse to re-engage a regular daily employee ; or (c) refuse to employ any person employed by him in the preceding twelve months ; or (d) dismiss an employee without notice. The argument for the applicant made the meaning of the second paragraph obscure. It was said that the words "any dispute under this clause" would comprehend any dispute which might arise from the provisions of the clause, not merely a dispute as to whether an employer had acted in contravention of the first paragraph. The expression "any such employee" was described by counsel as ambiguous : but he did not say what were the alternative meanings that in his view it could bear. I do not think the phrase is ambiguous, although it is so elliptical as to be syntactically censurable. It seems to me that it casts back to the first paragraph : I then read it as meaning "any employee as aforesaid who in manner aforesaid was given notice of termination or was not re-engaged or was not employed or was dismissed". A dispute "under this clause" relates then to a disputed allegation that some requirement of the first paragraph had been disobeyed. The remedies for which the second paragraph provides make this clear. They correspond distributively to breaches of the several requirements of the first paragraphs as I have set them out above : "reinstatement in employment" to (a) ; "re-engagement" to (b) ; "re-employment" to (c) and (d). (at p245)

2. In short, the second paragraph contemplates an order by the Commission requiring an employer to rectify a particular breach of one of the provisions of the first paragraph. I do not need nor do I intend to consider what might be the position if the proposed clause were differently framed and thus bore a different meaning from that which, as propounded, it has. It was said that the dispute comtemplated might be a new industrial dispute extending beyond the boundaries of any one State. But such a dispute would not readily answer the description of "any dispute under this clause". Moreover if a new industrial dispute arose and extended beyond the boundaries of any one State, then the Commission would have a constitutional jurisdiction with respect to it exercisable within the limits conferred by the Conciliation and Arbitration Act 1904-1969 (Cth). The proposed clause would be needless to confer jurisdiction in such a case. (at p245)

3. It is not denied - and in the face of par. (k) of the definition of "industrial matters" it could not be questioned - that if the first paragraph stood alone it could properly have a place in an award. The second paragraph is then to be seen as a provision for enforcing compliance with the requirements of the first paragraph. I agree with my brother Owen, whose judgment I have read, that this is so. Making orders for the enforcement of awards is outside the province of the Commission and for this reason the second paragraph would be invalid. The enforcement of awards is a matter for the Commonwealth Industrial Court under Pt V of the Act. In the present case what the second paragraph contemplates is an exercise of judicial power. To say whether in a particular case there has been a breach of the stipulations of an award, by an employer by his acting harshly or unreasonably in a particular matter, involves a judicial determination. (at p245)

4. It was urged for the respondent that to give this judicial power to the Commission might make for harmony in industry, as it would enable the administration of the relevant industrial award to be supervised promptly and satisfactorily by a member of the Commission having a close acquaintance with the particular industry. The seasonal character of employment in that industry in some parts of Australia gives rise, it was said, to special problems to which the clause is directed. But we cannot allow the Commission to trespass beyond the law to reach what it is said would be a good end. We are not to consider whether the clause would be beneficial, nor have we the knowledge necessary to express any opinion as to that. We are only concerned with whether the provision is one which can lawfully be inserted in an award. If it is a provision which the Commission can lawfully enact, it is for the Commission to consider whether adopting it would conduce to prevention or the settlement of industrial disputes. (at p246)

5. I do not find it necessary to examine the proposition that the second paragraph of the clause is invalid because it might be invoked in the case of a new and purely local and intrastate dispute. That might be so, if one aspect of the construction propounded by the respondent were adopted. But the question need not arise, for the provision is, as I have said, bad as it would involve an assumption by the Commission of a function which is not committed to it, and which, as I see it, could not constitutionally be committed to it. (at p246)

6. I wish to make two further observations arising out of the arguments we heard. The first is that the first paragraph of the clause would create new rights as between master and servant superimposed on the common law incidents of their relationship. It seems therefore that an action for wrongful dismissal or for a refusal of employment might be brought at common law by an employee based upon a non-compliance with the clause. Certainly proceedings could be instituted in the Industrial Court, or proceedings for a penalty taken in one of the courts mentioned in s. 119 of the Act. To give to a union the right to initiate proceedings before the Commission for the same complaint as an individual could make to a court seems to emphasize that the proceedings would have a judicial character. (at p246)

7. Finally, it was said that what the second paragraph comtemplated was comparable with the authority given in some awards to boards of reference. I certainly do not cast any doubt on the validity of provisions for such boards. Their function, as I understand it from what was said to us, is ordinarily to "fill out" the provisions of an award by deciding whether a particular concrete entity satisfies, for a particular locality, abstract and general requirements in an industry award. For example, a board may have to say whether particular physical things, equipment or premises meet requirements for the convenience or safety of employees expressed in general terms in an award. But determinations of that sort are altogether different from deciding whether conduct, not inherently unlawful, became unlawful because harsh or unreasonable - and then exercising a discretion whether or not to direct a particular remedy. (at p247)

8. I consider that the order nisi should be made absolute. (at p247)

OWEN J. In proceedings before Mr. Commissioner Gough, the Australasian Meat Industry Employees' Union (the union) sought to have included in the Federal Meat Industry Interim Award 1965 a clause in the following terms :

"An employer shall not give notice of termination of employment to a weekly employee or refuse to re-engage a regular daily employee or refuse to re-employ any person employed by him in the preceding twelve (12) months or dismiss an employee without notice harshly or unreasonably. If any dispute arises under this Clause the Commission may on the Application of the Union order the reinstatement in employment or re-engagement or re-employment of any such employee."

Counsel for the Meat and Allied Trades Federation of Australia, a party to the award and the prosecutor in the proceedings before us, submitted to the Commissioner that he had no jurisdiction to include in the award the second paragraph of the clause but, after hearing argument, the Commission overruled the objection and the prosecutor now seeks to make absolute an order nisi for prohibition restraining the Commissioner and the union from proceeding further with the union's application to have the proposed clause included in the award. (at p247)

2. It is not suggested that the Commissioner would not have jurisdiction to insert in the award the first paragraph of the clause. But it was said that, for several reasons, he could not validly incorporate in it the second paragraph of the proposed clause. It was submitted, in the first place, that the Conciliation and Arbitration Act does not confer power upon the Commission to enforce its awards and that even if it purported to do so any such provision would be invalid for constitutional reasons. It was then said that the paragraph in question seeks to provide a means whereby the obligations imposed upon an employer and the rights conferred upon an employee by the first paragraph may be enforced by the Commission since, if a dispute should arise under the clause and the Commission should decide that an employer had failed to comply with the obligations which would be imposed upon him by the first paragraph, it could order the employer to reinstate, re-engage or re-employ the person whose rights had, in the opinion of the Commission, been infringed. Further it was said that the paragraph purported to empower the Commission to deal with disputes arising in the future which might be purely intrastate disputes. (at p248)

3. As to the first of these contentions, it is conceded that the Conciliation and Arbitration Act does not and could not empower the Commission to enforce its awards and the question then seems to me to be whether, if the clause were incorporated in the award, its second paragraph would properly be described as an enforcement provision. I am compelled to the conclusion that it would. If, for example, employer A dismissed employee B without notice and a dispute arose under the clause as to whether A had acted harshly or unreasonably, the Commission, if application were made to it by the union, would be called upon to deal with the dispute and decide whether A had acted harshly or unreasonably and thereby committed a breach of the first paragraph of the clause. If the Commission decided that A had done so and had therefore wrongfully dismissed B and went on to order A to take B back into his employ, the order would, in my opinion, be one made for the purpose of enforcing the right given to B by the first paragraph to continue in A's employ until such time as his services were terminated in accordance with the terms of that paragraph. (at p248)

4. In these circumstances it is unnecessary for me to consider the other submissions made on behalf of the prosecutor. I would make the order absolute. (at p248)

WALSH J. For the reasons which have been stated by the Chief Justice and with which I agree I am of opinion that the order for prohibition should be made absolute. (at p248)

Orders

Order that the order nisi for prohibition be made absolute, prosecutor's costs to be paid by the respondent, the Australasian Meat Industry Employees' Union.