Raymond Hegarty v Commonwealth of Australia (acting through and represented by the Bureau of Meteorology)

[2015] FWC 5372

[2015] FWC 5372

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

Raymond Hegarty
v
Commonwealth of Australia (acting through and represented by the Bureau of Meteorology)
(C2014/5457)

Commonwealth employment
COMMISSIONER BISSETT	MELBOURNE, 10 AUGUST 2015

Alleged dispute about any matters arising under the enterprise agreement and the NES;[s186(6)] - jurisdictional - correct characterisation of the dispute - superannuation guarantee and rent free accommodation .

[1] On 17 July 2014 Mr Raymond Hegarty made an application for the Commission to deal with a dispute in accordance with the dispute settling procedures of the Bureau of Meteorology Enterprise Agreement 2011-2014 (the Agreement). The matter in dispute between Mr Hegarty and Bureau of Meteorology (the Bureau) goes to whether or not the Bureau is required to make superannuation contributions in respect of the value of rent free housing received by National Field Officers Pool (NFOP) employees of the Bureau.

[2] The dispute resolution procedure of the Agreement is at clause 49 and states:

49 Dispute Resolution Procedures

49.1 If a dispute relates to:

(a) a matter arising under this agreement; or
(b) the National Employment Standards (NES); or
(c) a matter relating to a request for flexible working arrangements under the NES; or
(d) a matter arising from an application for extended parental leave under the NES (beyond the first 12 months)

this clause sets out the procedure to settle the dispute

[3] Clause 29 of the Agreement sets out arrangements in relation to NFOP employees with clause 29.4 specifying that such employees receive rent free housing.

[4] Clause 19 of the Agreement states as follows:

19 Superannuation

19.1 In recognition of Superannuation Choice, the Bureau will advise all new employees of their options regarding superannuation and provide access to information on the available options.

19.2 The Bureau will make compulsory contributions as required by the applicable legislation and fund requirements. When employer contributions are the PSSap or an alternative accumulation superannuation fund the employer contributions will be 15.4% of the fortnightly superannuation contribution salary…

[5] The dispute, in essence, goes to what is included in the ‘fortnightly superannuation contribution salary’ for an employee in the NFOP. Whilst initially Mr Hegarty sought many other outcomes from his application, following conciliation of the application it is clear that this is the matter in dispute.

[6] The Bureau has indicated that it has a jurisdictional objection to the Commission dealing with the dispute. After further conciliation I issued direction for the filing of material in relation to the objection. Both Mr Hegarty and the Bureau indicated that they were content for the matter to be determined based on the written submissions already made and those made in accordance with the directions issued by me.

The Bureau’s objection

[7] The Bureau agrees that the dispute is over whether it is required to include the value of rent free accommodation in the calculation of superannuation contributions for NFOP employees.

[8] It submits that the correct approach to the question requires the Fair Work Commission (the Commission) ‘to identify the true character of the dispute.’ 1 Applying the approach in McCallum v Tenix Solutions Pty Ltd2 it submits leads to a conclusion that the dispute relates to the correct interpretation of the relevant superannuation legislation. Even if the dispute does relate to an obligation arising under the Agreement the Bureau submits that the dispute can only be resolved by interpreting the terms of the superannuation legislation.

[9] The Bureau submits that the decision in AWU v Etheridge Shire Council 3 does not support Mr Hegarty’s case.

Mr Hegarty’s submissions

[10] Mr Hegarty submits that all he seeks is the correct calculation of his salary for superannuation purposes in accordance with the Agreement and the Superannuation Act 1990. He says that the matter is one clearly arising under clause 19.2 of the Agreement.
[11] In support of his submission Mr Hegarty has provided an extract of legal advice he has received from Counsel on the matter. That advice is that:

• A dispute as to whether the employer is making contributions in accordance with its obligations is properly characterised as a dispute arising under the Agreement;



• A matter arises under the Agreement when a party to the Agreement has invoked the Agreement to support its claim and the invocation is not merely ‘colourable’ (Etherdige);



• The obligation to pay the correct superannuation contributions is incorporated into the Agreement.

[12] Mr Hegarty also submits that the area of disagreement between himself and the Bureau goes to whether the employment conditions of NFOP employees (by which I understand he is referring to the value of rent free housing) satisfy certain conditions in the superannuation legislation.

Determination of jurisdiction

[13] The dispute resolution procedure of the Agreement confers jurisdiction on the Commission to deal with disputes in relation to a number of matters including ‘a matter arising under this agreement’. There is nothing in the disputes resolution procedures that would operate to limit the Commission’s powers with respect to any particular matter arising under the Agreement.

[14] It is well accepted that, prior to exercising any power to resolve a dispute said to arise under an agreement the Commission must correctly characterise that dispute.

[15] In The Maritime Union of Australia v Australian Plant Services Pty Ltd 4Lacy SDP said:

An important limitation on the Commission's powers under s 170LW is the kind of disputes that may be subject to resolution by the Commission. Parliament has authorised the Commission to exercise powers under an agreement ‘to settle disputes over the application of the agreement’ and, accordingly, its powers are limited to disputes of that kind. Therefore it is necessary for the Commission, in each case where it is asked to deal with a matter arising under the dispute settling procedure in an agreement, to ascertain the character of the dispute that is before it in order determine whether the matter is a dispute over the application of the agreement. And, importantly, the character of the dispute is distinguishable from the orders that may be made in settlement of the dispute. 5

[16] In Seven Network v CPSU 6 a Full Bench of the AIRC was considering an appeal against an Order issued by a single member. In allowing the appeal the Full bench considered the process of determining jurisdiction. The Full Bench said:

…that to determine whether a dispute is over the application of the agreement requires a finding which characterises the dispute. This requires a finding as to jurisdictional fact. The first issue on appeal which the Full Bench must be concerned with is whether a dispute existed, on the evidence, over the application of the agreement. There is a need to characterise the dispute and then to decide whether the dispute, thus characterised, has nexus or sufficient nexus to the provisions of the agreement itself…

[17] In Skurnik v ABC 7 Lewin C considered the extent of the inquiry it was permissible for him to make and those things he could take into account in characterising the dispute. He said:

In order to properly characterise the dispute in the circumstances of this case I should have regard to the information and knowledge that I have of the dispute including the original notification, the relevant factual circumstances, my understanding of the various dimensions of the dispute derived during the conciliation process, the various submissions of the parties and the terms of the Agreement. This broad approach was endorsed by a Full Bench of the Australian Industrial Relations Commission in the case of Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v Holden Ltdwhere the following is stated:

[45] A dispute referred to the Commission must be properly characterised before powers conferred by a dispute settlement provision in a certified agreement are exercised. This is necessary in order to determine whether the dispute is ‘over the application of the agreement’ within the meaning of s 170LW of the WR Act. As noted by a majority of the Full Bench in Automated Reading Services (AMRS) v ASU, this expression has not been judicially considered. The majority went on to observe that:

‘A relationship between the provisions of the relevant agreement and the subject matters in dispute would appear to be an essential element in the identification of any dispute over the application of the agreement…

[46] We adopt these observations. Further, in our view the expression should not be narrowly construed. In this context we agree with the observation of the Full Bench in Shop, Distributive and Allied Employees Association v Big W Discount Department Stores that:

‘ …what comprises a dispute over the application of the agreement should not be narrowly construed; to do so would be contrary to the notion that certified agreements are intended to facilitate the harmonious working relationship of the parties during the operation of the agreement.

[47] In characterising the nature of the dispute in this matter the Commission is not confined to the dispute notification document. The entire factual background is relevant, including matters such as the submissions advanced. In this context we note that in TWU v Mayne Nickless Ltd the Full Court of the Federal Court held that in determining whether an application calls on the Commission to exercise judicial, as opposed to arbitral, power “a court should review the entire factual background to properly characterise the claim and the power sought to be invoked”.

(Original citations omitted)

[18] I have adopted this approach. I do not consider the decision in Tenix referred to by the Bureau is contrary to these authorities.

[19] The steps, therefore, to determining if the dispute is a matter arising under the agreement (as required by clause 49.1(a) of the Agreement) are to firstly characterise the dispute having regard to the application made by Mr Hegarty and information obtained through the conciliation process, including material provided by both parties. It then falls to consider if the dispute so characterised has sufficient nexus to the agreement. The consideration of this nexus should not be done with a narrow focus.

Is there jurisdiction?

[20] The dispute can be characterised as one relating to whether the value of rent free housing provided to NFOP employees should be included in salary for superannuation purposes.

[21] The Agreement provides for the provision of rent-free housing to NFOP employees and places an obligation on the Bureau to make superannuation payments of 15.4% of the fortnightly superannuation contribution salary. The dispute so notified clearly has a relationship to those matters in the Agreement.

[22] I am satisfied that the dispute, so characterised, has sufficient nexus to the agreement.

[23] I am also satisfied that the dispute resolution procedure in the Agreement has been complied with.

[24] This is not a dispute about whether rent free housing is provided but whether its value is included in the ‘superannuation contribution salary’ which forms the basis for clause 19.2 of the Agreement. That the determination of the dispute will possibly require some consideration of the relevant superannuation legislation and/or regulation does not mean that there is not a sufficient relationship between the matter in dispute and the Agreement. In this respect I would observe that it is not unusual to refer to materials external to an agreement in attempting to resolve a dispute between parties to an agreement.

[25] Of course a matter not yet canvassed is what relief the Commission may grant should the application be successful given the limitations imposed by s.739(5) of the Act which states that the Commission ‘must not make a decision that is inconsistent with this Act, or a fair work instrument that applies to the parties.’ That is, any decision in the matter cannot be inconsistent with the Agreement.

[26] The jurisdictional objection at this point is if the Commission has jurisdiction to hear the matter. The relief Mr Hegarty indicated he was seeking in his original application to the Commission is broad. Should this matter proceed to hearing it would be expected that Mr Hegarty would provide some more specificity of the relief he seeks. In doing so he should be mindful of course of the limitations imposed by s.739(5) of the Act.

Conclusion

[27] The jurisdictional objection of the Bureau is dismissed.

[28] The matter will be listed for mention by phone for the purpose of finalising directions for the hearing of the dispute.

COMMISSIONER

Written submissions:

Respondent: 3 June 2015

Applicant: 10 July 2015.

 1   Bureau submission 2 June 2015, paragraph 11.

 2   PR 940630, 19 November 2003.

 3 (2009) 178 FCR 252.

 4   PR908236.

 5   Ibid, [57].

 6 (2003) 122 IR 98.

 7 (2011) 217 IR 13.

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