Re State Public Services Federation; Ex parte Attorney General for WA, Qld; Re Electrical Trades Union of Australia & Ors; Ex parte State of NSW; Ex parte Sydney Electricity

[1992] HCATrans 163

.~

IN THE HIGH COURT OF AUSTRALIA	~
Office of the Registry

Perth	No P43 of 1991
In the matter of -

An application for a writ of

prohibition and a writ of

certiorari against the

Honourable JUSTICE PAUL MUNRO

and the Honourable .JO!lli

WILLIAM MACBEAN, Deputy

Presidents of the Australian

Industrial Relations

Commission and COMMISSIONER

BEVAN ROSS JOHNSON, a

Commissioner of the

Australian Industrial

Relations Commission

First Respondents

STATE PUBLIC SERVICES

FEDERATION

Second Respondents

Ex parte -

THE ATTORNEY-GENERAL FOR THE

STATE OF WESTERN AUSTRALIA

Prosecutor/Applicant

Office of the Registry

Brisbane	No B42 of 1991
In the matter of -

An application for a writ of prohibition and a writ of

certiorari against the

Honourable JUSTICE PAUL MUNRO

and the Honourable DEPUTY

PRESIDENT JOHN WILLIAM

MACBEAN, Deputy Presidents of

the Australian Industrial

Relations Commission and

COMMISSIONER BEVAN ROSS

JOHNSON of the Australian

Industrial Relations

Commission

First Respondents

Public 29 3/6/92

STATE PUBLIC SERVICES

FEDERATION

Second Respondent

Ex parte -

HER MAJESTY'S ATTORNEY-
GENERAL FOR THE STATE OF

QUEENSLAND

Prosecutor/Applicant

Office of the Registry

Sydney	No Sl9 of 1992
In the matter of -

An application for a writ of

prohibition and for a writ of

certiorari against

COMMISSIONER BEVAN ROSS

JOHNSON, a Commissioner of

the Australian Industrial

Relations Commission

First Respondent

THE ELECTRICAL TRADES UNION

OF AUSTRALIA, THE ASSOCIATION
OF PROFESSIONAL ENGINEERS AND

SCIENTISTS, AUSTRALIA, THE

FEDERATED MUNICIPAL AND SHIRE

COUNCIL EMPLOYEES UNION OF

AUSTRALIA, THE FEDERATION OF

INDUSTRIAL, MANUFACTURING AND

ENGINEERING EMPLOYEES, THE

METAL AND ENGINEERING WORKERS

UNION, THE FEDERATED ENGINE
DRIVERS, AND FIREMEN'S

ASSOCIATION OF AUSTRALASIA,

THE BUILDING WORKERS

INDUSTRIAL UNION OF

AUSTRALIA, THE OPERATIVE
PAINTERS AND DECORATORS UNION

OF AUSTRALIA, and THE
AUSTRALIAN INSTITUTE OF
MARINE AND POWER ENGINEERS

Second Respondents

Ex parte -

THE STATE OF NEW SOUTH WALES,

and THE ELECTRICITY

COMMISSION OF NEW SOUTH WALES

Applicants/Prosecutors

Public	30	3/6/92
Office of the Registry

Sydney	No S20 of 1992
In the matter of -

An application for a writ of

prohibition and a writ of

certiorari against

COMMISSIONER BEVAN ROSS

JOHNSON, a Commissioner of

the Australian Industrial

Relations Commission

First Respondent

THE ELECTRICAL TRADES UNION

OF AUSTRALIA, THE ASSOCIATION OF PROFESSIONAL ENGINEERS AND

SCIENTISTS, AUSTRALIA, THE

FEDERATED MUNICIPAL AND SHIRE
COUNCIL EMPLOYEES UNION OF
AUSTRALIA, THE FEDERATION OF
INDUSTRIAL, MANUFACTURING AND

ENGINEERING EMPLOYEES, THE

METAL AND ENGINEERING WORKERS

UNION, THE FEDERATED ENGINE
DRIVERS, AND FIREMEN'S

ASSOCIATION OF AUSTRALASIA,

THE BUILDING WORKERS

INDUSTRIAL UNION OF
AUSTRALIA, THE OPERATIVE
PAINTERS AND DECORATORS UNION
OF AUSTRALIA, and THE
AUSTRALIAN MUNICIPAL
TRANSPORT, ENERGY, WATER,
PORTS, COMMUNITY AND

INFORMATION SERVICES UNION

Second Respondents

Ex parte -

SYDNEY ELECTRICITY,
LOCAL GOVERNMENT

ELECTRICITY ASSOCIATION OF

NEW SOUTH WALES,

CENTRAL WEST COUNTY COUNCIL,
ILLAWARRA COUNTY COUNCIL,

MACQUARIE COUNTY COUNCIL,

MONARO COUNTY COUNCIL,
MURRAY RIVER COUNTY COUNCIL,
MURRUMBIDGEE COUNTY COUNCIL,

NAMOI VALLEY COUNTY COUNCIL,

Public 31 3/6/92

NEW ENGLAND COUNTY COUNCIL,

NORTHERN RIVERINA COUNTY

COUNCIL, NORTHERN RIVERS

COUNTY COUNCIL, NORTH WEST

COUNTY COUNCIL,

OPHIR COUNTY COUNCIL, OXLEY

COUNTY COUNCIL, PEEL

CUNNINGHAM COUNTY COUNCIL,

PROSPECT COUNTY COUNCI,

SHORTLAND COUNTY COUNCIL,

SOUTH WEST SLOPES COUNTY

COUNCIL, SOUTHERN MITCHELL

COUNTY COUNCIL, SOUTHERN

RIVERINA COUNTY COUNCIL,

SOUTHERN TABLELANDS COUNTY

COUNCIL, TUMUT COUNTY
COUNCIL, ULAN COUNTY COUNCIL,

TENTERFIELD SHIRE COUNCIL

Applicants/Prosecutors

MASON CJ

BRENNAN J
DEANE J

DAWSON J

TOOHEY J

GAUDRON J

McHUGH J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON WEDNESDAY, 3 JUNE 1992. AT 10.36 AM

(Continued from 2/6/92)

Copyright in the High Court of Australia

Public 32 3/6/92

MASON CJ: Yes, Mr Solicitor.

MR PARKER:  May it please the Court, at the break yesterday

I was inviting consideration of Your Honours to the

relevance of the industry represented by the

employees, or the various industries, to the
question of whether there was a community of

interest in the bringing of this single cause.	In
our submission, the notion of industry in that

context has relevance which will vary according to

the nature of the matter in contention. For

example, were there a dispute over a 35-hour week,

that subject-matter might well bring together

employees from a wide range of occupations. That

issue is not normally closely related to a

particular industry, although of course in the

particular dispute it might arise in such a

context.

We would contrast such a subject-matter of dispute with a dispute over pay. That is a matter

which directly and closely relates to a person's

calling and vocation. A clerk, a radio operator in

the police force, an accountant, a head of a public

service department, do not share a common interest

in their respective remuneration, even though each

may have the same employer and each may want more

pay. The Commission nevertheless, in this

particular case, concluded there was a community of

interest over the very wide range of employees

within the terms of the log. Two matters only

appear to have led to this conclusion, each, in our

submission, erroneously thought to reveal a

community of interest. The first, the fact that

the employers generically were States; a common

industry was seen, the employees of States and

their instrumentalities.

In our respectful submission, the nature and

diversity of work undertaken by the employees of

each State and the diversity of both function and

purpose of the particular employers who were served

is enough to deny the validity of such a glib

analysis. More so is the marked divergence in

these matters, State by State, within the scope of

the log. To say that all are employed in State

public sector employment is no more indicative, in

our submission, of a community of interest in pay

than to say that miners and retail sales staff have
a common interest in that they are each in private

sector employment.

The second factor, which appears to have led

the Commission to the conclusion that there was a

community of interest, was the statement which I

Public 33 3/6/92

had mentioned yesterday, at page 133 line 22 of the

papers, that:

The demand made is literally a demand for

observance within each State of a national

standard rate of pay.

This involves serious misdirection as, in our

submission, there was no literal demand for such a

standard, neither the demand nor the log raised

this; only three States were served; this makes

difficult a view that the claim could have been

intended to set a national standard or, at least,

without other evidence indicating why, if it was a

national standard, that there was a selection of
the three of those governments that are involved in

public sector employment.

It was, in our respect, completely unreal to

the very many and varied types of employees within the scope of the log, and also appears to deny the	think that a standard rate of pay was sought for national standard rate of pay. Your Honours will appreciate that there was just one global demand,
and there was no indication within the demand at
all as to how the various occupational groups might
have any relationship in the matter of
remuneration.

If anything was to be made of what was really

sought - if anything - it was, in our submission,

at the highest that an award or awards providing

for a wide variety of remuneration according to the

very many callings involved. This was

foreshadowed in the Union's submissions to the

Commission, and it finds its place in the written submissions before Your Honours, and there also even is their reference to separate awards for

separate vocations, State by State, in resolution

of this dispute.

Even if it were possible to view the claim in

that way, that is no more a claim for a national

standard rate of pay. At best, hidden within the

single demand there would have to be discerned very

many demands unspecified for very many unspecified

callings for very many national standards.

We ask in that context then what is the common

interest that unites all of these very many and

varied employees in this single claim for a single

rate of remuneration? In our submission, there is

none, and that should have been the finding below.

The proposition that there is such a community of

interest does not bear even limited consideration,

in our submission.

Public 34 3/6/92

Also relevant is whether there is, of course,

a community of interest among employers. At

page 133 lines 28 to 29 the Commission noted that

the respondents have a common "public sector

background". As already submitted, that, without

more cannot evidence that there is in this

non-compliance with this demand a common interest,

especially when the respondents are each State

Governments.

Then, at page 133, lines 31 to 33, the

Commission noted:

there are also several differences of

importance between the functions and

character of employers in the respective

States -

but the Commission otherwise failed to evaluate the

significance of this, perhaps because it was

content to rely upon simply the pronouncement that

there was a public sector background.

While there may exist a number of communities

of interest between some of the respondents

served - that is some of the agencies, some of the

departments in respect of particular activities

that they undertake - whether that is the case or

not has never been considered and determined by the

Commission. The Commission has failed to

appreciate the relevance of that. This, in part,

may be because of the approach taken by the Union

which has not sought to put its case on this basis

because, obviously, to do so would have been to

deny the singleness of the claim.

McHUGH J:  Is it part of your submission that the

relationship between each State in its own public

service is so unique that it is impossible for a
dispute between a State and its public service to

extend beyond the bounds of the particular State?

MR PARKER:  Such a universal proposition we would not

submit, if it please Your Honour. There are cases

where that would not be true but there are cases
where we would put that submission. But, for

example, to take an illustration from the history

of decisions of the Court, if there were teachers

throughout the nation united in a common cause to

secure some new appreciation of the worth of

teachers and proper industrial conditions, the fact

that a substantial segment of those teachers were

employed by States, in our submission, would not

deny the existence of a common cause.

McHUGH J:  How do you distinguish between professional engineers, skilled teachers, railway workers on the

Public 35 3/6/92

one hand, and this category of public servants who

are in a unique category?

MR PARKER:  The issue here is community of interest. I will

be dealing with other aspects of what Your Honour

raises and the more fundamental aspects later, but

the issue is community of interest. In our

submission, one can, given the right industrial

setting, find fairly readily a community of

interest in people united by some special training

or skills, some particular vocation which they

share in the proper appreciation of the industrial

merits of that vocation. So that when one comes to

particular specialized callings: teaching,
engineers, et cetera, that may be the factor which

provides a community of interest.

McHUGH J:  I can understand that at the employee level, but

what about at the employer level?

MR PARKER: 

The nature of a State government, in our

submission, if it is dealing with the function of
governing, is such that it is inherently
intrastate. There seems to us to be extreme

difficulty about saying that there is a community
of interest between distinct governments in our

federation in the way in which their respective
public servants are remunerated and regulated

industrially.

McHUGH J: 

The reason I ask you these questions,

Mr Solicitor, because I have some difficulty at the moment with a half-way house. It seems it is

either all or - - -

MR PARKER:  Yes, yes. Can we leave our submission, if it

please, Your Honour, on the footing that the nearer

one gets to the function of governing - and we will
develop that later - the more difficult it is to

find that distinct governments share any community

of interest in the way their respective public

servants and other officials are regulated in

industrial matters, so that when one gets to the

periphery of modern governmental activity which is
away from the notion of governing and is merely

those things which a modern government may choose

to undertake, that there is more scope for seeing

that there can be a community of interest; for

example, in how nurses, performing a function a

long way from governing, are regulated. If I could

leave it there and indicate that we will return to

that in a little while.

McHUGH J: Thank you, Mr Solicitor.

MR PARKER:  In our submissions, if it please Your Honours,

we would now turn to the issue of genuineness. The

Public 36 3/6/92

claim in terms seeks increases in the order of 2000

per cent for a very significant number of officers

within the scope of the log. A very substantial

segment of the public workforce in each of the

States is remunerated in the order of $20,000 a

year and less, and it is as simple as that that

leads to that figure.

In our submission, it is difficult to regard

such a claim as mere optimism or merely looking to

what might be reasonably sought in the foreseeable

future. In our submission, it is so unreal that it

raises the issue: is this really what is sought,

what is determined upon to be obtained? That

submission is put giving full measure to the ambit

notion.

Further, in respect of the most senior officers, the increases sought are in the order of

300 per cent. The percentages range between 300

and 2000 per cent for the very large number of

officers in between the two extremes. That
disparity suggests that the claim does not disclose
what those affected genuinely desire, whether now

or for the foreseeable future.

Then there is the very great range of

occupations and varied occupational settings within

the scope of the demand. Some are administrative

personnel, some clerical or typing or the like,

some involve a very wide range of technical skills, some a very wide range of professional skills, some

are involved in high level management, some are

statutory office holders, just as glimpses, ranging

from those in a State treasury, in the case of

Western Australia, to a small country hospital.

DAWSON J:	Some would be covered by awards, would they not?
MR PARKER:	Not federal.
DAWSON J: Yes.
MR PARKER:	And ranging from the head of a major department

to an unqualified assistant in a library, yet all

of these without discrimination of any type,

without any indication of any basis on which their

pay aspirations are united or can be linked, are

raised in a single claim which provides the sole

evidentiary foundation for the existence of a
dispute.

In our submission, there was a failure to attach proper significance to the singular nature

of this claim to say merely, as the Commission did

at page 135, lines 38 to 40 - - -

Public 37 3/6/92

DAWSON J:  Mr Solicitor, you have mentioned the authority.

Could you remind me of the authority which says

that it is not a genuine claim if it is merely to

attract the jurisdiction of the Commission.

MR PARKER:  Yes, Your Honour. Caledonian Collieries is the

main reference; I will get Your Honour the
reference to that, if it please you, Your Honour.

What the Commission said of it is that it does

little to reduce the scope for challenges to

genuineness, and we would, in our respectful

submission, suggest that that reveals a serious

failure to appreciate the matters that we have

raised.

TOOHEY J: It is a bit deeper than that, is it not,

Mr Solicitor? On page 135 the Commission says, at

about line 32:

The log could hardly be more generally worded and contains no claim specifically applicable

to any single class of the diverse

classifications within SPSF coverage. But, how does one read the term "minimum" in the

demand? That is a question that should not be

fairly asked of you, but of those who formulated

it. But does it mean that there is a claim for

$5000 a week for each person within constitutional

coverage, plus the allowance, or is it to set a

minimum of $5000 a week, but contemplate that for

certain officers, the amount might be more than

$5000?

MR PARKER:  There are two possible relevances which come to

mind: first is that the minimum is there, having

regard to the last claim that it be indexed for

positive movements.

TOOHEY J: Yes, I understand that but the word "minimum" is

quite unnecessary, if that is all that is sought to	achieve by it, because if $5000 a week is fixed and
then there is a formula for adjustment, well, the
word "minimum" is in a sense meaningless.

MR PARKER:  I agree, Your Honour. The other significance

that comes to mind is the	saying that "and nobody
shall get less", so that,	in effect, it is a claim
for a one figure.

TOOHEY J: Well, not necessarily; no one shall get less, but

some may get more.

MR PARKER: Well, as nothing more has been sought, subject

only to the indexation provision, one comes then to

the conclusion that it may be intended to say, "We

Public 38 l/6/93

want that total figure and nothing less, for

everybody. "

TOOHEY J: Yes, thank you. Just let me pursue that a little

further; I mean, it may be one thing to say, "This

is a demand for $5000 a week minimum for everyone

within the constitutional coverage of the Union",

but in fact the claim may contemplate that some

persons will be paid more than $5000 a week. That

still raises a question of genuineness, but perhaps

that focuses upon the amounts being claimed. If

the demand is that everyone be paid $5000 a week, then the question of genuineness focuses not only on that, but on the absence of any attempt to

differentiate between seniority, skills and all

those factors that might be relevant. As I say, I

suppose it is really not in your hands to explain

what the demand is, but it seems to me to be of

some importance to know what exactly the terms

which are sought by this demand.

MR PARKER:  I can only say that there has been no

development of this to explain those terms in the

position before the Commission, and we would say

that if it is to be read as saying, "Well, nobody

is to have less, but some may have more", that the

unreality becomes more manifest and that if there

is to be a reading that says, "Everybody is to have

the amount claimed and nothing less", the other

aspects to which we were directing attention come

into play.

Now, apart from the considerations we have

identified so far, in our respectful submission,

both the paper dispute doctrine and the ambit

doctrine have a share in leading the Commission to

this wrong result. We have respectfully submitted

at paras 33 to 36 of our submissions that some of

the reasoning in the decision of this Court in

Ludeke has encouraged a lack of attention to what

we submit are the real issues.	I will not go
through those submissions in detail, but we do,

particularly at paragraph 35, respectfully suggest

that a problem with the reasoning is that the

demand and its refusal by the employers never

address the same issue, that is, if the

justification for an optimism of demand is as is

suggested in Ludeke, that it is not what is

actually wanted now but something that may be

wanted in the future.

Where the only evidence of dispute is the

paper log and its non-acceptance, it would appear

that the consequence is that there really is no

evidence that the parties are now in disagreement

over the only issue which is identified as being

the subject-matter of the dispute, and there is no

Public 39 3/6/92

evidence in this case of any other subject-matter

of dispute.

BRENNAN J: What do you say, Mr Solicitor, to the notion

that the interpretation of the log is to be

considered in the context of existing industrial

situation, so that a claim, for example, of $5000 a

week is to be understood as a claim for something above what is being obtained now, being a sum not

in excess of $5000 a week?

MR PARKER:  In our respectful submission, if one is looking

in a situation where the only evidence is that of

the terms of the log, it is not a reasonable or

valid view to take that the terms in which the

dispute is expressed should be so ignored and

treated really as though they were saying something

which is quite utterly different, that - - -

DAWSON J:  Why could you not have a claim for more money, or

why could you not?

MR PARKER:  Subject to the decisions of this Court that have

so far indicated that the limits of the
jurisdiction of the Court have a lot to do with the
way in which the dispute is formulated, there could
be a lot in that although, with respect, one would

say that that is hardly an adequate identification of the subject of dispute, that is the aspiration. What then do they say is the basis upon which more

money is required, and, we would suggest, really,

one needs to go to something of that nature before

there is adequately identified the basis about

which the employers and employees are really in

dispute.

BRENNAN J:  I suppose you could also answer both

Justice Dawson and myself by saying it could be

acceded to in the sum of one cent?

MR PARKER:  Yes, I was dealing with industrial realities

which is the context of your question, sir.

MASON CJ: It is an unusual context.

MR PARKER:  It was prefaced that way, as I understood it.

Now, while for reasons that we have developed in paragraph 44 we do not at all question the decision

in Ludeke, we have respectfully submitted that part

of the reasoning, that part to which we have

referred, should not be followed.

At paragraph 32 we have submitted,

particularly in the second paragraph of that

submission, a more constitutionally appropriate

role for the ambit doctrine. That matter was

canvassed in the course of yesterday's proceedings

Public 40 3/6/92

and I think in the interests of time that I do not

need to develop that further.

At paragraph 36 we have respectfully submitted

that the ambit doctrine has now, for the reasons

that are being developed in these written

submissions, reached the point where as it is

presently applied it has become a fiction which

allows the Commission regularly to exceed the

constitutional limits of its jurisdiction, that is,

by arbitrating in respect of disputes which are not

disputes or threatened disputes.

DEANE J:  Mr Solicitor, why is not a dispute about whether

there should be a federal award, putting aside

interstateness, an industrial dispute?

MR PARKER:  The subject-matter of an industrial dispute has

to be the terms and conditions of the relationship

between an employer and employee is one aspect of

the answer, if it please Your Honour.

DEANE J: Let me put it differently. Why should not the

dispute about whether the relationship between an
employer and an employee should or should not be

governed by a federal award be an industrial

dispute?

MR PARKER:  If one developed enough real industrial facts

about such a notion there could be found to be an

industrial dispute, not because of the claim for

there to be simply federal coverage, but because

federal coverage was desired for some genuine

industrial reason. If it is merely an issue

whether union A or union B, another federal or a

State union, will have the capacity to represe~t a certain group of workers which is if there is

nothing else available usually the basic reason why

federal coverage is sought, in our respectful

submission, there is absent an industrial issue in

the sense that is relevant to industrial dispute in

section Sl(xxxv).

Your Honours will have noticed that

substantially out of consideration for time, I am

tending to rely upon the fairly substantial

references that have been given in our written

submissions to authority, rather than take

Your Honours to it, and with one or two exceptions

that will be the approach that I take.

Just before leaving genuineness, I failed to

point out to Your Honours, and I apologize, that at
paragraphs 45, 46 and 47 we have considered firstly

the factors which the Commission below articulated

in reaching the conclusion that there was here a

dispute and, in respect of them, we have

Public 41 3/6/92

respectfully submitted the error which we see in

the treatment given that subject-matter by the

Commission. And at paragraph 47 we have identified

matters which we say were relevant to the issue

whether there was a genuine dispute extending

beyond the limits of a State and which were not

considered by the Commission in that finding.

The result of our submissions as to

genuineness, if it please the Court, is that there

should be seen here to be a lack of any basis for

an inclusion properly directed by the Commission

that there was a genuine dispute extending beyond

the limits of any one State.

I turn now, if it please Your Honours, to our submissions concerning discrimination which is

ground (d) of the order. Between paragraphs 48 and

56 we develop a submission which, in outline, I can

put in this way: firstly, Commonwealth law will be
invalid if it discriminates against a State or
States in the sense that it singles out a State or

States for the imposition of some special burden or

disability; secondly, that section 51(xxxv) is

subject to that principle; thirdly, that the

Commonwealth Parliament cannot authorize any
discrimination which infringes that principle;

fourthly, in this case, the finding of dispute is a

step in the exercise of jurisdiction which has been

invoked for the making of an award; next, that an

award prevails over inconsistent State laws and

awards in virtue of section 152 of the Industrial Relations Act; next, that in this case the award

sought or any award that might be made would bind

only State governments; and finally, that involves
the singling out of a State or States for the

imposition of a special burden or disability.

I would like to develop only one aspect of

this, that is what is the most contentious issue,

whether the proper analysis is that an award as

sought is merely a particular working out or

application of a statute of general application.

That is, one which involves no singling out but merely subjects the States to the general body of law applicable to the community or whether there is

a singling out in the prohibited sense.

BRENNAN J:  Does that mean you are not developing 48(a), is

that the proposition?

MR PARKER: For discrimination, Your Honour, we would simply

rely upon the authorities that are there cited for

that proposition. We will be developing the

content of 48(a) in our next set of submissions

dealing with the next ground.

Public 42 3/6/92

BRENNAN J:	I see.
MR PARKER:	It should be made clear that this submission

only arises because the sole respondents to the proposed awards are States. If other non-State

governmental parties were genuinely parties to a

dispute found in the proceedings and an award in

settlement of the dispute did not burden the States

as against the non-government respondents, there

would be no foundation for this submission.

GAUDRON J:  Mr Solicitor, I do not know if you are going to

go to it but I would be assisted if you would say

why it is the States are singled out simply because

they are the only parties to the dispute or to an

award that may be made. In that respect, they seem

to be put on precisely the same basis as employers

generally. There is always a singling out.

MR PARKER:  That is precisely the point that our submission

will deal with, if it please Your Honour. We

submit this position then is really the consequence

of the uniqueness of the dispute said to be

evidenced by this log in that it involves only

State government respondents. In our submission,

it is a superficial analysis to view this as the

making of an award in respect of this dispute as

merely a particular application of a general law.

The whole of the award-making process and the

effect given an award is part of the one

legislative scheme of the Commonwealth. An award

is relevantly a critical step in the legislative

scheme. Attention needs to be focused on the

nature of an award and its effect. An award under

the Act is a novel creation, it is of prospective

effect. What it does is to create new rights and

obligations as between employer and employee.

It is not a reflection of existing law or of

existing legal rights, nor an application of

prescribed statutory principles. It is the product

of the exercise by an administrative agency of the

Commonwealth of a wide and substantially unfettered

discretion, a discretion the object and purpose of

which is to determine those new rights as between

employer and employee.

It is the scheme and effect of the Act that

the statement of newly created rights and

obligations which comprise an award will be given

the force of paramount federal law. The statutory

scheme allows and makes no attempt to inhibit

discrimination against States in the relevant sense

in an award. Therefore, in our submission, under

the special scheme of this statute, the significant

issue should not be the generality of the Act,

Public 43 3/6/92

which we accept as non-discriminatory, but the

force of law it purports to give to an award which

is a creature of the Act itself where that award

singles out a State or States for the burdens

created by and imposed pursuant to the award. The

statutory scheme as a whole, not one technical step

in its operation, should determine whether there

has been discrimination.

We would further submit that in the relevant sense, these are special burdens, because they are

unique to the particular award and therefore

necessarily in this case uniquely applicable to the

State respondents, and they are a burden because it

imposes new obligations not previously existing. Alternatively, I suppose, it could be said the

award sought contemplates remuneration only to

State government employees and at rates vastly

superior to that prevailing in any other area of

comparable employment. To make an award which

imposes an obligation to pay more than prevails

elsewhere in respect of comparable employment is to

impose a special discriminatory burden on the State

respondents.

DAWSON J:  You go further than that. You say to impose a

rate of pay which is prohibitive, do you not?

MR PARKER:  We would certainly say that as well,

Your Honour, yes. Therefore, at the least, we

would submit, and this is our alternative

submission not our primary, no award could be made

in this case which granted more than prevailing

rates for comparable employment without there being

a singling out for a special burden of the State

respondents.

BRENNAN J: That rather seems to accept that there is

comparable employment.

MR PARKER: It is an alternative submission. There clearly

can be comparable employment in some parts of State

government. I have identified teachers and nurses

as classic example, and one might say there could
comparable employment of a typist, without going

more deeply into the nuances, so the scope exists

for such a finding to be made.

BRENNAN J: Then what is the implication of your argument

for the seeking of a federal award covering State

school teachers?

MR PARKER:	If it deals only with State school teachers, our primary submission is that it is not possible for
an award to be made.  If State school teachers are
part of a dispute which involves other teachers,

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then so long as no separate and more burdensome

provision is made in respect of the State

respondents an award can be made.

BRENNAN J: What about shunters, guards and drivers on

trains?

MR PARKER:	The same, if it please, Your Honour.
BRENNAN J:	So a federal award for them is impossible simply because their employer is the State?
MR PARKER:	Yes, where that is the only issue. This, in our

respectful submission, is what flows from a true

appreciation of what the scheme of this Act is in

its application to those particular situations that

arise where the only respondents are States.

BRENNAN J: What then is the nature of the discrimination

upon which you rely being other than the exposure

of the States to the jurisdiction of the

Commission, or do you challenge - - -

MR PARKER:	The discrimination is that the States are singled out for a special or particular burden.
BRENNAN J:	The singling out consisting in what?
MR PARKER:	A special burden is created upon the States

which are not created or placed upon others.

BRENNAN J:  The burden consists simply of the liability to

be bound by an award made in the exercise of what,

State apart, would be an ordinary exercise of jurisdiction.

MR PARKER: Yes.

BRENNAN J: That seems to allege the existence of

discrimination simply because the State is itself

argument? subject to that jurisdiction, or do I mistake the

MR PARKER: That is a consequence, Your Honour. It is not

the analysis of why there is discrimination. That

arises, in our submission, from the scheme of the

Act which is - - -

BRENNAN J: Is it not a consequence which is inconsistent

with the Engineers' case?

MR PARKER:  We would not have thought, if it please

Your Honour.

GAUDRON J: What I do not understand is this notion of

special burden, if all that you are doing is

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treating the State as employer in exactly the same

way as you treat any other employer.

MR PARKER:	Our submission, if it please Your Honour, is that because what is created under the scheme of
the statute and given the force of law is a new set
of obligations, that imposes necessarily burdens
upon an employer which are different from those
previously existing or generally applying.

GAUDRON J: Yes, but why do you look to the position of the

State before and after? What is there about the

notion of discrimination that makes that a valid

form of analysis?

MR PARKER:	Well, it is a prohibition on what can be done in respect of a State in the exercise of the
legislative power of the Commonwealth. If it
happens that it is the State that is the party upon whom that burden is imposed, that attracts the prohibition, if it please Your Honour.

GAUDRON J: Which prohibition is that?

MR PARKER:  The principle that a Commonwealth law will be

invalid if it discriminates against the States, or

some of them, in the sense that it imposes some

special burden or disability - that it singles them

out, as it is often put.

GAUDRON J: Well, you are saying that the authorities, when

saying some special burden or disability, are not

looking to the general picture, but are looking to

the historical position of the States, because it

is a very odd notion of discrimination if that is

what is involved.

MR PARKER:  If it please Your Honour, perhaps it is odd

because it is something that has not been the focus

of direct attention before, and while the previous

cases such as Engineers' have raised the amenability of State governments to federal awards,	they have all arisen in the context where there are
non-State respondents involved in the same dispute,
and there has not been attention focussed - - -

GAUDRON J: Well you say that there is no possibility even

for the piecemeal settlement of a dispute, contrary

to authority; that in this regard, a State employer

has to be treated differently from any other

employer.

MR PARKER: Well, it may well be the consequence of our

submission that the approach which has some current

fashion of having found that there is a dispute

that is interstate in character, to then

immediately deal with it as discrete disputes State

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by State and resolve them on that basis as though

the stateness was determinative of a significant aspect of the dispute, and that if that approach

were taken and there was only an award in favour of

or against State government respondents, then the

submission that we put would resolve.

GAUDRON J: There must be a lot of invalid awards - all the

railway awards must be invalid, on your basis.

MR PARKER:  Yes, that may be so, Your Honour. There is one

distinction which I perhaps should have put to

His Honour Justice Brennan, that where there is no

comparable employment, on our alternative

submission then it may be possible, say, in the
case as railways, if there were no non-government

railways, to reach the position that an award could

be made.

DAWSON J:  I was going to ask you about that because it is

hardly discrimination when you are the only one.

MR PARKER:  Yes.

DAWSON J: But it is different to say, "We have singled you

out as an employer, and it is the very fact of your

being the employer which is the basis for the

award".

MR PARKER:  Yes. That is the position here, of course, the

respondents are identified in virtue of their being

State governments.

GAUDRON J: But why is that different from identifying

employers by virtue of their operating in the meat

industry?

MR PARKER: With respect, because it is giving rise to a

very different dispute. Here, it is the business

of being involved in State government, in its

fullest sense, which is the focus of this award or

this dispute.

DEANE J:  But do you really need to distinguish. I mean, as

I follow your argument would not the answer be that an award which imposes a burden on an employer by

reference to a discrimen that its employees are

employees of butchers, does discriminate against

butchers.

MR PARKER: That would be correct, sir.

DEANE J: And as I follow your argument it is that here the

award imposes the burden upon State governments and

instrumentalities by reason and by reference to the

fact that their employees are employees of States

and State instrumentalities.

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MR PARKER: If it please, Your Honour, yes.

DEANE J:  I am not suggesting it is right, but it seems to

me that is the way the argument needs to be put.

MR PARKER:  Yes, I am grateful to Your Honour. The other

aspect of discrimination we have dealt with in

paragraphs 57 to 60. My learned friend, the

Solicitor for New South Wales, will develop those

submissions which we would, respectfully, adopt in

anticipation.

Could I just pause to give to Your Honour

Justice Dawson references Caledonian Collieries,

first, 42 CLR 527 at 579 to 80; the Crown
v Blakeley, 82 CLR 54 at 69; Brisbane Tramways,

19 CLR 43, and perhaps see Cohen, 157 CLR 331 at

338 to 9, there it was suggesting that an increase

in membership of the Union is a non-genuine

purpose, and Ludeke, 159 CLR 178.

DAWSON J: Thank you.

MR PARKER:  Ground (e) is in two limbs and it deals with

laws impairing States and the administrative

services of a State, and our submissions, from

paragraphs 61 to 77, deal with this. If I could

refer Your Honours to paragraph 74, where we have

set out the recent statements of the limitation by

this Court, the limitation, of course, being first

fully articulated - it had been evident in other

forms earlier - but fully articulated in

Melbourne Corporation, 74 CLR 31, especially at

pages 52 to 3, 67, 75 and 101.

Now, we will not stop to analyse whether there

are particular differences in the recent
statements. Generally, Your Honours will see from

them that what is comprehended is that an

implication arises in view of the place of the

States as governments in the Federation which

precludes an exercise of legislative power by the continued existence of the States or their capacity to function as governments, or as it is sometimes

put, to perform their constitutional powers.

In the CYSS case, 153 CLR 297, at page 313, it

was noted that the fresh approach to the definition

of "industrial dispute" had the consequence that if

section 5l(xxxv) is not to be applied to the

administrative services of the State, then that

limitation must now rest on an implication to be

drawn from the federal structure. It may be that

the statements we have set out at paragraph 74 are

the basis of that implication.

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DAWSON J:  Mr Solicitor, can I just detain you for a moment.

It is said, of course, by most people that

discrimination is a separate ground for denying

legislation validity in relation to the States.

Why is it a separate ground? What is the

justification for saying that? Why does it not

rest in the same foundation as the restriction you

are now speaking about?

MR PARKER:  It may well, if there is fuller consideration of

this matter, be revealed that there is in truth a

single basis for these various statements just as

we have ventured that it may be that the older

notion of administrative services of the State has

its genesis in a similar notion to the Melbourne

Corporation principle. The singling out may be

grounded in just that same sort of notion, or

it - - -

DAWSON J: Well, if it is not grounded in that, what is it

grounded in?

MR PARKER:  It may be out of a realization that running

alongside of the Melbourne Corporation is the
notion that if there are a number of governments
which together form the governmental structure of a

Federation, that necessarily there should be seen

to be a specific implication that, as it were,

those governments should each respect the

separateness and the coherence and integrity of the

other, and should not single them out for some

special adverse treatment. It may be that it can

be seen to be a separate doctrine, or it may be a

more full development of the Melbourne Corporation

doctrine ..... to ground it.

DAWSON J:	It would only be adverse if it interferes with the performance of their functions, so you come
back - - -
MR PARKER:	Yes, they come very close together, do they not,

Your Honour. In the present context, however the

impairment principle is precisely expressed, it

requires an inquiry into what is involved in the

existence of a State in what is involved in being a

State at all, and also into what is involved in the

functioning of a State government or performing the

constitutional functions of a State.

These inquiries, in our submission, are

necessitated by the very nature of the implication

which has been identified. The authorities have

not got very far down the road of exploring the
notion. In our respectful submission, nevertheless

the task must be faced.

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While the earlier cases have generally turned

on the concept of industry in this section 5l(xxxv)

context they do contain discussion and exploration

of notions which may prove informative. May I just

give Your Honours three particular references:

firstly, to Justice Higgins in the Merchant Service

Guild, 28 CLR 436, at 454; to Mr Justice Isaacs in

the School Teachers' case, 41 CLR 569, at 583 to

585, noting that His Honour there was in dissent

but he was in dissent on the very point that has

come to be right with CYSS decision, so that his

discussion may be more pertinent than some others;

and the decision of Mr Justice Williams in which Mr

Justice Rich concurred in the State Public

Servants' case, 66 CLR 488, at 533.

In our submission, in trying to approach this

against the background of the authorities decided

in respect of section 5l(xxxv) which, may I frank

say, necessarily limits the breadth of that which I

might otherwise have been inclined to put to

Your Honours. I am necessarily coming at it, in

our respectful submission, fully respecting the
authority that has been expounded and, as a

consequence, significantly curtailing other notions

of which might seem to be the constitutional role
of the government of a State.

At the bottom, in our submission, and the core of it is the notion that government exists to

govern. A government may choose to do more but our

inquiry is directed to its purpose of governing.

Any analysis, in our submission, would start with

the accepted concepts that the essential components

of government, in the context of our Constitution,

at least, and of our constitutional history,

consists of a legislative, a judicial and an

executive function, each in some relationship with

the Crown.

The existence of these functions or components

can, in our submission, in our context, be seen to

be essential to the existence of a State

government. Simply put, a government, in our

context, may not govern without each of them.

However, the functions of each component differ and

that will lead to difference in determining what is essential to the constitutional functioning of each

component.

With the judiciary and the legislature, our

system incorporates fundamental notions of
independence - perhaps not perfectly, but they are

important to the function of being performed. For

the judiciary and the Parliament to function, in

our submission, it is self-evident that they

require staff of all levels in their support,

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ranging in the case of courts from masters or

registrars or equivalent officers to registry

staff, tipstaves et cetera. These are necessary,
albeit in most cases simply in a supportive or

incidental way, to the fulfilment of the function

of the judiciary and the Parliament.

In our submission, for relevant purposes those

staff are equally therefore involved in the

function of government. We would submit that the

judiciary and the Parliament, together with the

governor and his or her establishment, including

their establishments which enable them to fulfil

their function are in the relevant sense essential

to the constitutional functioning of a State.

The executive raises different considerations.

In part the executive can be seen to be carrying out the primary function of governing. In this

respect, it can be seen to be essential to the

existence of government and to the performance of

its essential function of governing. The executive

may also undertake other and extremely varied

activities which are not part of governing, but

which functions the government in the public

interest may choose to undertake.

It is only to that primary or essential

functioning of governing that our submissions in

respect of the executive are directed.	By focus on
the activity of governing, the sorts of

difficulties which are identified, for example, by

Mr Justice Windeyer in the Professional Engineers'

case, 107 CLR, particularly at 274 to 275, are

largely avoided.

That discussion, which has been oft-cited of course, in the Professional Engineers' is largely

directed to the different question: what should be

the functions of government and the sphere of the

State, the answers to which will of course be

influenced by fashions or schools of political
philosophy.	Of course, His Honour's discussion is

influenced by his realization that the functions

. which government in fact undertakes vary with time

in history and the country and its polity.

It is in this type of context, if one asked

questions such as, "What is a normal function of

government or what is an essential function of

government?", that considerable difficulty is said

and readily seen to be involved. Your Honours will

be familiar with the discussions, for example, in

the Payroll Tax case, 122 CLR, particularly at

pages 82 to 83 by the then Chief Justice, and

page 398, Mr Justice Windeyer again, 410 to 411,

Mr Justice Walsh, and page 424, Mr Justice Gibbs.

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Of course, there has been a canvassing of some of

this recently in the decision of Lee, 160 CLR.	The
passage is at page 452.
In the American dialogue the issue arises differently, of course, under the commerce power,

and focuses on the historical or traditional

functions of government; a quite different and much

wider concept from that which we propose, although

of course overlapping in part. Your Honours will

be aware that there the concept was eventually

abandoned, although only by a five four majority

and with strong dissent, and some of my learned

friends will be dealing with that, but the point we

make is that it has there been considered in the

history of judicial consideration, looking at what

are the historical or traditional functions of

government.

We would respectfully invite Your Honours

therefore to consider this narrower notion: what is

it that is encompassed in the function of
governing? And we would direct our attention

particularly to the executive, because in the sense

of a government of the State the functions that I
have already identified of the judiciary and the

legislature and the Crown are each part of the

function of governing. I am now considering the

executive's role in that governing.

We have identified a number of aspects. They

are not entirely discrete, there is some overlap

which will assist in an analysis of the executive's

role in the function of governing. Firstly, there

is the administration of the laws of the

government. However those laws may be made that

process includes, of course, a role in the making

of the laws; the formulation of policy; policy for

change and improvement; formulation of strategies

for the implementation of laws; directing their

implementation and their enforcement.

TOOHEY J:  Mr Solicitor, I am just having some difficulty in

seeing which direction the argument is taking. Is
it suggested that the intrusion by the Commission
through the making of an award into the affairs of
the State, in the sense that you have described
them, of itself impairs the function of the State,

or is it the potential for the making of an award

which, in terms, financially would make it

impossible for the State to operate, but said to

constitute the impairment of function?

MR PARKER:  Our primary submission, if it please

Your Honours, which we will be developing, is that

the capacity to regulate the industrial relations of those components of the State that perform the

Public 52 3/6/92

function of governing is a direct intrusion into
the government of a State, is, in fact, the

exercise of a part of the function of governing

itself.

TOOHEY J: So, as you put it then, it is not the amounts

sought in the demand which give rise to this

objection.

MR PARKER:	Not at all, no.
TOOHEY J:	It would not matter even if the amounts sought were, ·on their face, reasonable.

MR PARKER:  Yes. The core of our submission is that to be

regulating industrially those who govern is,

itself, a function of the government of the State.

TOOHEY J: Yes, thank you.

MR PARKER:  We were mentioning that administering the laws

was a component. Of course, there is the process,

as it were, of filling in the gaps, which is part

of the process of implementation, that is the
formulating of practical administrative policies
within the framework of the law which enables it

then to be applied efficiently or effectively.

There is a function of the executive in the

legislative process; the making of delegated law,
including, of course, the policy formulation which

that involves. There is the maintenance of public

order, self-evidently a primary State governmental

function, equivalent in States perhaps to the
federal defence power. It is specifically
recognized in section 119 of the Constitution. It

is traditionally, primarily, the role of the

police, but other authorities are involved and just

to distract for a moment, we would just, in our

respectful submission, remind Your Honours that the

McHUGH J: But, both these illustrations that you have just	of the laws and in the maintenance of public order. judiciary are involved both in the administration	given were mentioned by Lord Blackburn in Combe v
Justices of Burkes, were they not, and have they
not been rejected as a workable test?

MR PARKER:  In our respectful submission, they are mentioned

in a quite different context. We would like to

give to Your Honour the full scope of what we say

is governing and its relevance to the executive,

and the result, in our submission, is a quite

manageable test.·

The next activity is raising and managing the

revenue; revenue necessary for the whole of

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government, recognized of course in Melbourne

Corporation, and it is recognized specifically in

the constitutions of the various States in matters

such as consolidated revenue, loans, appropriation

procedure and the like.

Then there is the, in a sense, more

housekeeping function, but nevertheless one without

which the business of governing may not occur; that
is providing the facilities and services necessary

for the other executive functions involved in

governing and for the legislature and the judiciary

and, of course, ensuring that they are provided in

an efficient and competent manner.

McHUGH J: But, Mr Solicitor, when you talk about employees,

are you talking about all employees involved in,

for example, raising the revenue in those

departments? Do you distinguish between the

typists and the assessor in the revenue department

of a State government?

MR PARKER:  Your Honour, in our submission, the nature of

some of these functions indicates that the whole of
some departments or agencies may be dedicated to

them. Their function -

McHUGH J: Including the typist, the word processor?

MR PARKER:  Yes, if it please Your Honour; the whole range

of people, whose function is to be part, for
example, in the case of Treasury or the Tax

Department, it exists for the purpose of revenue,

and all the functions of that department, from the

cleaner to the head, are directed in the process of

government to revenue. And, for example, the whole

of the police force is directed to law and order.

Of course, in other cases, distinct sections of a department or agencies will be dedicated to a

with which Your Honours will be familiar are the	particular function of governing. Simple examples
Parliamentary Counsel's office or a law reform commission. In other cases, a relatively small number, generally among the more senior, but with necessary support staff for their function to be
fulfilled, may be engaged in policy formulation,
whether legislative or executive, and in directing
the implementation of law and policy. Now, typical examples are in the fields of education and health,
where really it is only the policy makers and the
directors, those giving the direction to the
department, that are engaged in governing.

McHUGH J:  I got the impression, obviously wrongly, from

your written submissions that the distinction that

you were seeking to make was between those who were

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appointed by, say, the Governor in Council and

other employees but that is wrong?

MR PARKER:  I am sorry, that is not our submission,

Your Honour. I am sorry if the written submissions

gave that impression.

McHUGH J:	It would be my reading of it.
MR PARKER:	We would proceed from that brief but, in our

respectful submission, a sufficiently indicative

analysis of what we say is the function of

governing and an analysis of how components of a

State government are involved in governing but

other components of the executive are not, and
quite substantial components to a further stage in
our submission and that is that it is an integral

or an inherent quality of governing to determine

how a government is to govern.

This, we submit, requires and includes determination by government how it is to perform

the various functions involved in governing. That

is, in one sense, a starting point of government in

that the first policy to be determined is who and how is it that policy is to be determined for the

future.

McHUGH J: But what do you say about Sir Owen Dixon's dictum

in the Professional Engineers' case, at page 234,

where he said that what naturally falls within

5l(xxxv) cannot be excluded because it answers the

description "governmental"? Are we to put a gloss

on that or are we to reject that dictum?

MR PARKER:  We would respectfully say that is a very

different question that His Honour is answering

there. We are attempting to take account of views

such as that and many others in identifying that

part of the whole structure of State government

which can be seen to be involved in the function of
government and only government.	How governing is

performed involves, inevitably, by whom and in what

circumstances the functions involved in governing

are to be performed.

McHUGH J:  I am sure it is my fault, Mr Solicitor, but it

really does seem to me that I am hearing arguments

in a different form but which have substantially

been rejected for the last 70 years.

MR PARKER:	In our respectful submission, the issue has been asked in the past quite usually in a very different
context, that is what is the function of State
government embracing within the notion then those aspects which a State government chooses to
undertake and which it is free to undertake. There

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have been some discussions which have sought to
narrow down to the core of governing and the

passages that I have cited to Your Honours earlier

are among them. But those views have not prevailed

or those views have not been taken up and analysed

and developed, because the occasion for doing it

has, until CYSS, been masked.

DAWSON J: That is right, is it not, the questions are asked

against a background of there being industrial and

non-industrial employment? Now that that has gone,

you have got to take another look.

MR PARKER:	It it please Your Honour, this flower has now come out from under the umbrella, and it has now
got to be looked at in, what as we presently
understand it to be, its true light. Before it was
almost an aside of industry in section 5l(xxxv).
MASON CJ:	Can you say that of the passage in the joint

judgment of Justices Brennan, Deane and myself in

re Lee, page 452?

MR PARKER:  I do not believe I can, sir, because you were

already out from under the umbrella, yes.

MASON CJ: Exactly.

MR PARKER:  And Your Honours there were, though, in our

respectful submission - 453, was it not?

MASON CJ: Page 452, it goes over to 453, but the basic

thrust of it is on 452.

MR PARKER:  Your Honours had canvassed the history and had

given consideration to the views of

Justice Windeyer, and Your Honours were looking at

the American position, it was traditional

government, and looking at the discredited

distinction between functions of government which

are essential or truly governmental. And the point

we would make, if it please Your Honours, is that

those considerations were directed not to what we

are propounding, those considerations of what is

essential or truly governmental were directed

generally in the context of whether something was

within an industry or not, and identifying as those

things that were essential or truly governmental as

outside an industry, and were also in their

discussions when they are looked at, for the most

part, embracing not only governing but that which

governments choose also to do.

So that, in our respectful submission, if one

comes to analyse, as we attempt to do, what is

governing, what we are embarked upon is something

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that is different from what was being focused upon

in these decisions and discussion.

DAWSON J:  It is true to say that previously there were some

positions of employees in government employment

which you would say clearly were not industrial,

before the CYSS case.

MR PARKER:	Yes.
DAWSON J:	Now, perhaps, you could no longer say that, but

there may be another reason why the Commission -

its reach does not extend to them.

MR PARKER:  Yes. Thank you, Your Honour. And, in

particular, a comment to Your Honour the

Chief Justice, the discussion in Lee is, in our submission, not rejecting our test. There it is

the dual meaning of the word "function" which masks

the difference between what we are putting and

what, as we understand it, was being considered in

that passage. And it is the function, which we

have respectfully put to Your Honours for

consideration, of governing which is that which we

are now developing, and it is that, in our

submission, which is the essential quality of State

government.

MASON CJ:  I suppose you can make the additional point that

this passage is really directed to a wider class

than the class of public servants that you are

seeking to identify, it is dealing with the wider

class of those engaged in the administrative

services estate who had formerly remained, to use

your expression, within the umbrella in pre-Social

Welfare Union days.

MR PARKER:  Thank you, Your Honour. Moving on, how

governing is performed, we were submitting,

involves inevitably by whom and in what

part of governing. Let me seek by illustration to circumstances the functions involved in governing are performed. That, in our submission, is itself spell that out.

I was moving, Your Honours, to develop by

illustration the submission that it is itself a

part of governing to determine by whom and in what

circumstances the functions involved in governing

are performed. The illustrations can run these

ways: take first that in shaping for its purposes

the form of the executive, there is a very wide

range of policy decision by government. That is

implemented in part and can be directly influenced

or negatived by considerations normally within the

reach of the industrial relations power.

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For example, what type of public service is

the State to prefer? Is it a career public

service, in which case tenure is secured? A formal

structure usually exists with elaborate appeal and

review procedures. All of that is thought

generally desirable to establish what might be

thought to be the more traditional model of a

career and substantially independent public

service, one which serves governments as they come

and go impartially.

The more it is thought important that the

service should be independent of the government of

the day in its advice and administration, the more

attention is paid to isolating recruitment and

promotion and dismissal and remuneration decisions

from the direction or influence of ministers.

Often the ideals of fairness and independence will

lead to a government exercising its autonomy by placing some of those decisions in the hands of

independent arbiters. While that occurs at the

will of the government, and while the government

may determine the policies to be applied by those

arbiters, and while it is within the capacity of

the government to change those arrangements if some

different organization comes to be preferred, then

there is no loss of governmental autonomy. In our

respectful submission it is different if another

government, by its agency, is able to exercise its

will and determine such matters despite the wishes

and needs of the State. An alternative approach to

basic structure of a public service is to have an executive in the current idiom more responsive to the needs of government.

This leads to a structure in which tenure is

of short term. Recruitment and promotion can be

directly influenced by the ministry. In

determining your models or implementing them, the

selection and shaping of the public service is

significantly influenced by salary and conditions.

They affect substantially the nature and quality of

persons who can be found to perform what government
determines needs to be done.

Independent career-minded professional administrators, for example, might be attracted in

a sufficient number and quality at one level of

salary structure in a permanently tenured career
service. Successful performers responsive to the aspirations of a present government might require

an entirely different basis or quantity of

remuneration to attract them from their successful

activities elsewhere for a shorter tenure directed

to the time of the current administration.

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Those factors indicate, in our respectful

submission, how relevant industrial considerations are to fundamental policy issues of how government

is to be performed, how the governing, and by whom

the governing is to be conducted, because

industrial considerations can go as far as

determining who will occupy positions. Preference
to Union membership in appointment, promotional
opportunities, appeals et cetera and dismissal

rights may all be affected by industrial

considerations.

Next, we would observe that to ensure that the function of governing is performed, disciplinary

provisions are a usual feature of government

service. They often include, as in Western

Australia, suspension without pay, a loss of pay or
a reduction in pay on a permanent basis. These are

measures seen by a government to be relevant to

ensuring that its function of governing is

performed by those charged with the responsibility.

Next, we would observe that there is a very

careful balance often struck in the relationships

within the executive and between the executive and,

for example, the judiciary and the legislature and

in the shaping of the judicial and legislative arms

of government; matters which can be directly

affected by industrial relations considerations.

Your Honours are all familiar with the relevance of

security of tenure and of assured salary and

conditions to judicial independence.

What other officers involved in the judicial

arm of government should enjoy something of these

qualities and in what measure can have a real
effect on the constitutional position and

effectiveness of the judiciary. Determining those

matters are matters of fundamental governmental

policy; they are part of governing.

One can go a very opposite extreme, still in

the judicial example. There may be a deliberate

excluding of security of tenure for some staff who

are directly associated with the judiciary. For

example, the personal staff, where it is considered

that only those who enjoy the complete confidence

of the judges as to their discretion and

trustworthiness, should occupy such a position.	An
important aspect of policy formulation of

government touching industrial relations matters is

in determining the relationship between those

members of the executive who, for example, support
the judiciary, and the rest of the executive. To
what extent, if. at all, should the members of the

executive supporting the judiciary be accountable

to external control, whether executive or

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parliamentary, account outside the judiciary

itself, in some or all aspects of their

functions.Your Honours will see that industrial

considerations can effect all of those issues.

Turning this in the executive itself, for

example, a government needs the capacity to
organize its resources to meet its governmental

priorities. For example, if it sees there is need

for a different policy approach to financial

management, it may wish to deal with treasury

staffing and recruitment on a very different

footing from other parts of its executive. It may

want to do that from the highest to the lowest of

the department, or just the mid and upper range

economists, or simply the very head of the

department, all of those matters being determined

in light of and by virtue of and necessarily to

enable fundamental policy issues of government to

be implemented effectively.

The government may perceive the need to

emphasize recruitment and the advancement of

officers with special qualities or expertise. It

may perceive the importance of responding t~

special needs, for example, a wealth of mining

accidents of significance might require that there

be a significant boosting in quality and in

quantity of those involved in mining inspection and

supervision which is part of governing.

It may have to decide which areas have

priority in tight budgeting times. That will go to

matters of staff, levels of remuneration, numbers

of officers; for example, the enforcement of some

laws may, for financial reasons, have to be put on

a lower level of priority and given less staff and

less well paid staff than others because of the

financial management of the State.

Hours of work may be very material to how the

government is able to manage any part of the

performance of its functions of governing. In the

field of law and order, a State government may

choose to ensure, as a matter of policy, a

substantial independence of its police force from

the rest of the executive. Some systems will

emphasize the independence of individual officers

within the structure of the force in critical

decision making, for example, what charges to lay

and against whom.

Other governments may try other models of

police control, including the complete subjection

of all police to ministerial direction. Some

prefer police to be engaged at pleasure,

essentially to ensure propriety of conduct and

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public confidence. Others offer various levels of
security of tenure. Those matters go directly of

course, and indirectly, to the shaping of

fundamental rights in the community.

Some governments may prefer a recruitment or

promotion policy which encourages more highly

educated persons to join the police force. All of

these sorts of considerations, in our submission,

are inherent and essential if a government is to be

able to govern. It involves being able to

determine those matters because they, in their
various ways, can directly affect governing.

It should not be overlooked, in our

submission, that it is part of the function of
governing to see that these functions are

performed. For example, if for some industrial

reason law and order is not maintained or revenue

is not collected, it is appropriate for government

to compel their performance or arrange alternative

performance.

McHUGH J: But in what way does the making of an award

impinge on these, other than the bo_ttom line so far

as the budget is concerned? Is that what it is all

about?

MR PARKER:  It is not the making of an award, Your Honour; I

am just about to come to the answer to the question

Your Honour is contemplating. We submit that to

function as a government, a government must be able

to determine who will be engaged in governing and

on what terms and with what responsibility and with

what accountability. The industrial relations

power, if it extended to those who perform the

functions of governing, would come between the

government in its corporate sense and those engaged

in governing, in ways capable of affecting who may

perform those functions, when and how, on what

terms, and it would, in various degrees, inhibit or

more.

preclude the matters we have identified, and many

The exercise of industrial control coercively,

under section Sl(xxxv), is simply inconsistent with

an inherent attribute of State government.

DAWSON J:  You can test it more easily by contemplating, not

an award which involves a certain process, but

really, could the Commonwealth Government legislate

directly with respect to these matters? And of

course, it could if what you are saying is not

correct; to settle or prevent a particular

industrial dispute in this area.

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MR PARKER:  Yes. In our submission, the core of it is that

it is part of the business of governing to decide

who governs and how.

McHUGH J: All of these arguments of yours might suggest the

Engineers' case was wrongly decided, but once you accepted the Engineers' case is correct, how can

you distinguish? Surely the States have got an

interest in what rail services they provide; what

sort of transport services they provide, yet, even

on your argument, these areas would be covered by

the Sl(xxxv) power.

MR PARKER: Indeed, Your Honour, and - - -

McHUGH J:	How do you distinguish between the State's right to choose who it will employ in its railways, and
what services, what terms and conditions they will be employed at, and the environmental department or
the taxation department?
MR PARKER:	If it please, Your Honour, the point of our

distinction is contained in the very test which

Melbourne Corporation and the later cases have

propounded: "What is it that is the essential

functioning of government?", and we have said of

that instead of looking at the question, "What are

the functions that government chooses to perform",

we respectfully say that at bottom of that a proper

test is what is it that is governing.

McHUGH J: It is a very shifting test. What about the

environment, what about public health, are they

forward in your protective categories?

MR PARKER:  In our respectful submission, that is not the

right question. Our test and its operation, as we

have tried to expound it, does not have regard to

those matters. It says, of activities such as

that, "Are these people implementing law; are these people administering law?", et cetera. I am

saying of those natures, those types of

consideration, that they are each merely matters

which a government may choose, in the course of its

ongoing exercise of responsibility, to become

involved in. When it chooses to become involved in

them a part of the function of governing, a limited

part, is to do with them. Policy formulation, direct administration, supervision, direction,

et cetera.

For the rest, delivery of services and what have you, it is not part of governing, and we have

sought separately to identify those functions of

government which are essential to any government

and, therefore, by virtue of their function

inherently and necessarily part of governing.

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DAWSON J: Given that there is a line to draw, do you have

to draw it in this case?

MR PARKER:  We do not have to draw it in this case,

Your Honours, but we have thought it important,

particularly because of the discussion in Lee, with

respect, to try and point out that there is a

reasonable and, we would submit, quite workable
approach which focuses on the core activity of

governing which does - - -

McHUGH J: Well, that sounds very much the same as

inalienable functions of government to me.

MR PARKER: Well, it has a close relationship, if it please

Your Honour. That was only ever tested though

previously in the context of juxtaposition with

industry and, of course, it has taken some

different shapes and notions since then. But it

has much to do with it, and we would respectfully

submit that it really has not, in the context of

the present test, ever been considered or rejected.

BRENNAN J:  Mr Solicitor, I do not know whether this is part

of your argument, but does it lead to this, that the appointment of the officers of government to

perform what in your terms would be the core

functions of government creates such a unique

relationship between the State and the person so

appointed as distinct from other persons employed

by the same government that it is impossible for an

interstate dispute to exist with respect to the

first class of persons so appointed?

MR PARKER:  We recognize that as one way in which the sort

of notion that we are exploring could be put. We

have put it though, I think, on a different basis.

BRENNAN J: Yes. You have put it on a far broader

constitutional basis, as I understand it, which is

one of constitutional immunity, and that runs into

some difficulties, but your concern is, as I

understand it, immunity from the exercise

of Sl(xxxv) power and it may be that the way in

which the immunity operates, if immunity there be,

is in the way which I have indicated.

MR PARKER:  Yes, we would accept that as one way the matter

can be viewed.

McHUGH J: That is why I put it to you, much earlier this

morning except I used the word "public services"

generally, but at least for the moment it is

attractive to me if you can confine publicly unique

relationship in some special way, but I am having

difficulty in seeing how you can find a

satisfactory and workable line of demarcation

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between public service generally and employees in

it, and I know you are struggling - I should not

say "struggle" - I am struggling to understand it.

MR PARKER:  The struggle is in my ineptitude, if it please

Your Honour, I am sure. Authority necessarily has

precluded the most natural response to the sort of question, if it is asked, "What do governments do;

what are the functions of government?" And one is

left then with, "Does the Constitution do anything,

by implication, to ensure that States are able to

function as governments or not?" Our submission to

that is that it does and it must and, in light of

authority, our submission is that what it does is

to ensure that the function of governing of a State

is beyond the reach of the industrial relations

power.

The function of governing is a concept far

narrower than the things which a State may choose

to do. We have sought, in our submissions, to

identify what is involved in governing as opposed to administering those other things which a State

may choose to become involved in.

We say that in respect of those who perform

the function of governing, and they include the

judiciary, the legislature and parts of the

executive, it is a part of governing not only to

make the decisions of government but to decide who
will perform those functions that are part of

governing and to do so in a way that determines who

and how with what responsibility and what

accountability and that the ability of another

government to be able to affect any aspect of the

industrial relations of those who are performing

the function of governing is to itself have another

government perform part of the function of State

government; that is, part of the business of

governing. That, in our submission, is the

fundamental constitutional objection to Sl(xxxv)

reaching those who are involved in governing in a

State.

McHUGH J: If your argument is wrong, there would be nothing

to stop the Commonwealth under Sl(xxxv) legislating

to appoint the Federal Minister for Industrial

Relations to arbitrate on these disputes.

MR PARKER:	Yes, if it please Your Honour.
DAWSON J:	On the other hand, the conciliation and

arbitration power has always been held not to reach

into management, and really what you are talking

about is the management of the State, but you live
with that by saying the management of an enterprise

must be conducted within industrial conditions

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which have been laid down and we can still make

that distinction. I do not know how that works out

after the Social Welfare Union case when the

managing directors or the boards of directors get

together and ask for an award.	We have not thought
about that.

MR PARKER:  Our respectful submission is that be they

managing directors or others, if their function in

the government of the State is to be governing,

then they are beyond the reach of the industrial

relations power.

DAWSON J: Would you say the same thing in industry, that if

their function is to manage, then they are beyond

the reach of the arbitration - - -

MR PARKER:  No, Your Honour, this arises because what is

protected from the reach of the industrial

relations power is the essential function of a

State government.

DAWSON J:  The essential function of a State government is

the managing of the State. It is an analogy.

MR PARKER: Free of authority, we would embrace that

submission, if it please Your Honour. With

authority, we must curtail the reach of that but

still identify some clear and workable basis for

saying that which it is that is protected.	In our
respectful submission, it is the function of

governing shorn of all its add-on trimmings that

governments may indulge in which is protected.

Because of that submission it is the existence of a capacity in another government to regulate,

industrially, those who govern in a State which

offends the protection which we say, by

implication, is afforded a State from the reach of

this power.

BRENNAN J:  Do you go to the extent of saying, amongst those

who might be members of a public service there is

one class who can be described as employees of the

State and another class which can be described as officers of the State not being employees?

MR PARKER:  With respect, we would not see the label as

helpful. We think that what is critical is the

function, whether the person is engaged in

governing, and however labelled - - -

BRENNAN J: Perhaps it is important to the purpose of

discovering whether it is possible to have an

industrial dispute?

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MR PARKER:	Yes, I see Your Honour's point, yes.	Thank you,

Your Honour.

BRENNAN J: It is not a gift, I - - -

MR PARKER:  I know, Your Honour, but it is a thought that is

worth exploring, and this goes something along the

road of those thoughts which Mr Justice Windeyer

expressed, that one can never say in the end that

his beloved soldier is an employee, or that a

mutiny is a strike even though - - -

DAWSON J: What you are saying is that even post Social

Welfare Union case there are still some employer/employee relationships which are not

industrial in character.

MR PARKER:  Yes, well, this is the thought that I have

picked up from what Justice Brennan put to me.

There is scope for that. And the reason for that

may be that because the officers that we are

looking at have the function of governing they are

not employees in any industrial sense.

DAWSON J:  Maybe management in industry is the same that

way.

MR PARKER:  It may have a relationship to that. But when

the task of an employee is to govern there is a

difficulty with the notion that they are involved

in an industrial dispute if they have some concern

with their State in respect of the way in which
they are remunerated or their other industrial

conditions.

We had wanted to quickly contrast what we had

put to Your Honours from the sort of issue raised by the Payroll Tax case. It is one thing, as the Payroll Tax case tells us, to take an aspect of

employer/employee relationship of a State, for

example, the salary and wages that it pays, and

without in any way directly interfering with that,

to impose by reference to it a tax which is a tax

also imposed on the rest of the community. That

case as identified is merely a financial burden,

and it happens to operate by reference to what a

State is paying an employee.

In our submission, it is fundamentally

different in character to step between a government

and its employees to direct the terms of the

employment relationship in the very many ways that

come within the scope of the industrial relations

power. It is to interfere with and reshape - that

is the capacity of the power - the

employer/employee relationship. In our submission,

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that is the present case. The issue is whether the

capacity available to the industrial relations

power can intrude itself into the regulation of

those who govern a State. If it does, in our

submission it is itself involved in governing a

State. We would distinguish that fundamentally in

principle from the mere imposition of a tax by

reference to what a government pays its employees.

The analysis we have proposed also avoids the

problem otherwise presented by the cumulative

effect of many discrete exercises of industrial

control of those involved in governing. For

example, it is tempting to say of this case that

there is only money involved, but if there is
industrial control here, there is scope for

different and fuller measure of industrial control

to be sought to be effected. It can be at the

hands of a variety of unions over a number of years

progressively.

If one accepts the prospect that some

exercises may be within power and others not in
respect of the same types of workers, one must
inevitably reach the difficulty of saying when is

too much too much, when is the camel's back broken,

when is it that one reaches an impermissible

intrusion? Is it then the whole of the awards that

have in cumulation reached that impermissible

level, or is it just the last one that is affected,

et cetera?

All of that, in our respectful submission, is

a discourse that becomes irrelevant if what we have

put to the Court is accepted. Now the older notion

of the administrative services of government may,

of course, be seen to be substantially similar in

result to our identification of those performing

the essential function of governing. This may

serve, in part, to explain why it has been of

utility in the development of the understandings in

this field, particularly in the older industry

context.

Were it to be thought relevant in light of the course of authority those whom we have identified

as performing in the executive and in the other

arms of government, the function of governing could

serve as a statement of the administrative services

of government, at least in the context that we are

presently dealing.

We would draw attention to one other

consequence of what we have proposed. Whereas in

the old dialogue of which government officers were

in industry, where one found State officers

performing functions which were partly within

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industry and partly not, the industrial relations

power could be seen to extend to those officers,
but if the issue is properly to be seen to be

whether a State officer is engaged in governing so

as to attract the implied limitation on

Commonwealth power, then to find that an officer,

in part, performs the function of governing is

enough to bring that officer within the protection;

at least, of course, if it is not merely some

incidental or peripheral act of governing.

There is one distinct aspect raised in our

submissions to which we would address some
comments. That concerns the decision in Re Lee;

this time at page 430. That is 160 CLR,

particularly, I should say, at page 453.

Your Honours will be familiar with what three of Your Honours described as the "preliminary view" which you had formed, and it is the two main

paragraphs on page 453 which are the essence:

There is accordingly much to be said for the proposition that, assuming that there is

no discrimination against a State or singling

out, such as occurred in Queensland

Electricity Commission v The Commonwealth, the

exercise of the arbitration power in the
ordinary course of events will not transgress

the implied limitations on Commonwealth

legislative power. The exercise by the

Commission of its authority with respect to

the employment relationship between a State

and its employees in the course of settling an

interstate industrial dispute appears to fall

withins. 5l(xxxv). Although the purpose of

the implied limitations is to impose some

limit on the exercise of Commonwealth power in

the interest of preserving the existence of
the States as constituent elements in the

federation, the implied limitations must be

read subject to the express provisions of the

Constitution. Where a head of Commonwealth

power, on its true construction, authorizes

legislation the effect of which is to

interfere with the exercise by the States of

their powers to regulate a particular

subject-matter, there can be no room for the

application of the implied limitations.

The same point may be expressed in

another way by saying that in deciding whether
Commonwealth legislation has the effect of
impairing or inhibiting the continued

existence of the States or their capacity to

govern, we must look to the role which the

States have to play under the Constitution.

If the Constitution contemplates that the

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States will be subject to control or

regulation by the Commonwealth or its agencies

in particular respects, their subjection to

that control or regulation cannot amount to a

relevant impairment or inhibition of their

capacity to govern. On the view which we are

presently inclined to take of the implied the Constitution which contemplate their
limitations, they do not protect the States
from the consequences of the exercise by the

application to the States. Nor do they

protect the States from an erosion in their
status occasioned by the increasing regulation

of community affairs by the Commonwealth in

accordance with its powers.

The last sentence, in our submission, may well

indicate the point at which this discussion was

directed. I must respectfully indicate to

Your Honours, though, that there is some difficulty and difference of opinion as to precisely what is

intended to be the reach of those two passages.

Our submission is directed to the view which,

on one reading, is intended, that no limitation

arising by implication from the position of the

States as essential components within the

Commonwealth can limit what might otherwise be

thought to be the full ambit of section Sl(xxxv). The passage which perhaps particularly gives rise

to this is that in the first paragraph:

the implied limitations must be read subject
to the express provisions of the

Constitution -

and the rest of the reasoning that builds upon

that. Whether or not that may have been

contemplated by those who are party to this

discussion - - -

MASON CJ:	You have got to read that sentence with the next sentence.
MR PARKER:	Indeed, Your Honour, I know. There will

be -

MASON CJ:  Mr Solicitor, we may adjourn now. We will resume

at 2.15.

AT 12.49 PM LUNCHEON ADJOURNMENT

Public 69 3/6/92

UPON RESUMING AT 2.17 PM:

MASON CJ: Yes, Mr Solicitor?

MR PARKER:  At the break, if it please Your Honours, I was

dealing with the decision in Lee against the

background that if the passages to which I have

directed Your Honours attention, at page 453, are

intended to contain within them the view that no

limitation arising by implication would limit what

would.otherwise be within the ambit of

section 5l(xxxv), we would contrast that possible

intention of these two paragraphs with what,

without necessarily turning Your Honours to it,
what was said by Your Honour the Chief Justice in

the Dam's case, if I could just read to you two or

three lines from 158 CLR 129:

As Social Welfare Union demonstrates, a head

of power under s. 51 should be given its

natural meaning; the exercise of the power is

then subject to the express and implied

prohibitions in the Constitution, including

the implied prohibition enunciated in

Melbourne Corporation.

Without labouring the point more, we would

respectfully submit that that is the correct

approach and is applicable to the operation of this

limitation, it being the Melbourne Corporation

limitation to 5l(xxxv).

McHUGH J: Well, Chief Justice Gibbs expressed the principle

in much the same terms in Lee's case at page 442.

MR PARKER:  Thank you, Your Honour. There is some direct

relevance of this and the passage in Lee to which I

have directed attention in the reasons of the

Commission, simply to say that after an extensive

citation from Lee and the preferred view, at

page 146 the Commission came to the position that

the preliminary view in Lee, to use their exact

words at line 20:

affords a basis upon which we should act in

this matter.

It would seem from the understanding they had of

the preliminary view is that therefore there was no limit on the scope of the reach of section 5l(xxxv)

in respect of the administrative services of

government, and for that reason they did not

proceed to give any consideration in finding a

dispute whether those within the dispute were

within the notion of administrative services of

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government or not. And the paragraph that follows

that reference at page 146 line 20 simply says as

an afterthought or an aside, "Well, even if there

is something wrong with that, we can go on now and

it would not invalidate our finding because of some

other considerations."

But the important thing is that it would

appear from the decision of the Commission that it

directed itself, in our submission, contrary to the correct constructional approach, to the effect that

there was no limitation arising by implication that

would contract the operation of section 52(xxxv),

and were then proceeding, not only in the finding

but in their future conduct of the case, to deal

with it on that basis, so that the notion as they
were directly looking at, the administrative

services of government - - -

GAUDRON J:  Do you make any specific submission about that

following paragraph on page 146?

MR PARKER:  We had not thought to at this point, if if

please Your Honour.

GAUDRON J: It does seem to be a boot straps.conferral of

authority to hear and determine matters.

MR PARKER: Well, if it please Your Honour, that is a proper

view and we would respectfully adopt it, but we

would prefer though to go back to the more

fundamental views that in this respect and some

others, there would appear to be a clear

misdirection in more fundamental issues and that

that has infected the way that they have proceeded

into a consideration of the assessment of whether

there is within their power the capacity to deal

with the proceedings for an award in respect of the

dispute revealed here by this log.

Now, we would also in reference to the

way of an alternative submission, draw attention to	preliminary view in Lee at page 453, and perhaps by
the phrase near the commencement of the first
paragraph on that page:

the exercise of the arbitration power in the
ordinary course of events will not transgress

the implied limitations on Commonwealth

legislative power.

We would simply draw attention, if it please

the Court, to the facts that this case is anything
but the ordinary course, unique in the history of

industrial arbitration, as a log directed solely to State governments involving, in at least two of the

States, the whole, or substantially the whole, of

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the public service and statutory offices, and in

this context we would refer Your Honours to the

passage in the CYSS case, Reg v Coldham, 153 CLR

297, at page 313, where at about the middle of the

first paragraph on 313, the Court, referring to

Melbourne Corporation and the Pay-roll Tax case,

in discussing the nature of the limitations

considered in those cases, which is the one we are

now focusing upon, said:

If at least some of the views expressed in those cases are accepted, a Commonwealth law

which permitted an instrumentality of the

Commonwealth to control the pay, hours of work

and conditions of employment of all State

public servants could not be sustained as

valid -

May I just delay Your Honours for a moment by

attempting to put very briefly once again to

Your Honour Justice McHugh the reason why we are

down this path. I am concerned that our minds have

not even started to understand each other on the

point. Melbourne Corporation and Queensland

Electricity Commission have set the distinction

between existing as a government and the activities

essential to the existence of a government, on the

one hand, and those many other functions which

governments may choose to engage in.

Only the first of those two alternatives is,

on the authorities, denied to the reach of

Commonwealth legislative power. It is necessary

therefore to face up to this distinction to discern

where the line which is required to be drawn by

those decisions is to be drawn. That is what we

have attempted to do.

We have focused on governing as the essential

function, the generic description of the essential

of a government as such, and the generic function, that which is essential to the existence
description of the activities essential to the

existence of a government. Another formulation

often used but often in a different context is the

essential functions of government.

In our submissions, whenever we use these

notions of existing as a government, the essential
functions of a government or, particularly,

governing, we are only intending to comprehend

those parts of what governments actually do which

relates to their existence as governments and their essential activities as governments within the test

formulated in Melbourne Corporation and Queensland

Electricity Commission.

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For the vast part, the discussion in the cases

has been dealing with the essential functions of

government on a much broader canvas than the test,

as we understand it, in those cases requires us now

to concentrate on.

McHUGH J: But what is the criterion for determining between

the two categories of government?

MR PARKER:  We have tried to answer that, if it please

Your Honour, and perhaps we can do it in this sort

of simple language.	What is it that a government
is about?	We have used the word "governing" and

that is making decisions, decisions for the

community, carrying them out, seeing that they are

carried out. It is about getting the money to do

it and it is about maintaining law and order in the

community. And that is what is governing.

When you are governing, whether you decide, for example, to be conscious of the environment or

to, as it were, allow the State to fall to waste

out of some commercial interest is not the business

of governing; that is what the State then decides

it will do in the course - the part that is

governing is deciding what it will do or will not

do; giving effect to that is not governing.

McHUGH J: That seems to me to be an almost 19th century

would think that protection of the environment by governments is as important as any other function,

view about the functions of government to do that.

in fact more important than most functions.

MR PARKER:  If it please Your Honour, yes, and that line of

thought would lead us, inevitably, to invite the

Court to overrule much that might have fallen from

the Court. We have tried to frame our submissions

within the lines of authority, and clearly and

certainly within both Engineers and Professional

Engineers, the cases that were concerning

Your Honour, and to deal with then what is it that

is essential to the existence of a government and

the functioning of a government as such.

They, if it please the Court, are our

submissions.

MASON CJ: Thank you, Mr Solicitor. Mr Douglas, are you

going to follow at this stage?

MR DOUGLAS:  Yes, Your Honour.

MASON CJ: Very well.

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MR DOUGLAS:  Can I say, initially, that we adopt generally

what has been said already by the learned

Solicitor-General for Western Australia.

MASON CJ: Yes.

MR DOUGLAS:  I should outline to you some of the salient

differences between the case for Queensland and the
case for Western Australia relating to the facts,

and for that you will need the application book, and particularly the log of claims starting from

page 173. You will also need our written

submissions which contain as annexures extracts

containing our submissions.

from one of the exhibits before the Industrial

The essential difference, in a nutshell, is

that whereas in Western Australia and Tasmania, as

you have already heard, the bulk of the public service generally were the subject of a log of claims. In Queensland the respondents served and

the callings, in respect of which the log is
relevant because of the rules of the then

Professional Officers Association, are narrow in

compass and perhaps also more focused on issues

perhaps more central to governmental functions in

the sense that, as the Full Bench said, the persons

referred to in the list of callings reflect

generally professional and semi-professional

callings.

I will take you to, first of all, in the application book starting at page 189, the list of

the Queensland respondents. They are listed over

the pages going up to page 195, and it can be

described briefly and generally as the Queen in

right of the State of Queensland, all of the then
relevant ministers of the Crown, and the then

relevant heads of public service departments. So

the concentration was upon the core of the public

service as such - the officers of the public

service, as that term would be generally known. You then have to go to annexure B to our

written submissions. Attachment A appears
immediately after page 44. Unfortunately the
attachments are not numbered in sequence, but

attachment Bis about twelve pages further on. It

contains relevant parts of the rules of the

Professional Officers (State Public Services and

Instrumentalities) Association, which was the Union

which served the log of claims on the Queensland

respondents.

I will be referring to these rules for two

purposes: one, to show the nature of the

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eligibility rule of the Union, and secondly, in

respect of our second point in our case which is

that this log of claims was served on Queensland

respondents by a Union whose eligibility rule

relevantly only covered Queensland; whereas in

respect of Western Australia the log of claims

covered Western Australian respondents and

Tasmanian respondents.

You can see the second point from the "Constitution and conditions of eligibility for

Membership", which is clause 2(1):

The Association shall consist of an unlimited number of persons employed, or usually

employed by or on behalf of

(a) The Crown in the right of the States of

New South Wales and Queensland -

and, of course, New South Wales was not the subject of a log of claims; only Queensland was. And that

limitation in respect to Queensland is carried

through, and further down on the same page are set

out the sorts of persons who may be covered by the
eligibility rule in Queensland without limiting the

unlimited reference above. Then when you go to the

second page the limitation comes from the words on

the third and fourth lines:

In or in connection with any one or more of

the following industries or industrial

pursuits in -

then you go to page 3 Queensland, and over that

page and the following page are listed the callings

relevant to this Union.

TOOHEY J:	Mr Douglas, what are the words of limitation that dictate that only professionals and
semi-professionals are eligible for membership.
MR DOUGLAS:	It seems to be a conclusion the Full Bench drew

from a general view of the list of occupations set

out in this list.

TOOHEY J: That seems to be prefaced by the words "without

limiting the generality of the foregoing"

unless -

MR DOUGLAS:	Yes, that is so.
TOOHEY J:	- - - it is to be construed rather differently

from what it appears to be at first blush at any

rate. But there is a general statement of

employment by the Crown, and then the

identification of various occupations but within

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the framework of "without limiting the generality",

unless you read "without limiting the generality"

as somehow only qualifying the two headings, New

South Wales and Queensland.

MR DOUGLAS:  We must confess to having made an assumption

that that was the appropriate interpretation below.

We have been convinced by our learned friends and by the Full Bench that the manner in which you

should read it is that there is an unlimited number

of persons employed on behalf of the Crown in the

right of the State of Queensland, including certain

people set out in the first page listed under

Queensland, but then -

in or in connection with ..... the following

industries or industrial pursuits -

seems to qualify an unlimited number of persons.

So that you then read that with the lists on

page 3, accountants, actuaries, architects, et

cetera.

TOOHEY J: It seems an odd process of construction.

MR DOUGLAS:  Yes, it does, and we were initially confused in that fashion ourselves, Your Honour.

TOOHEY J: At any rate, it is common ground, is it?

MR DOUGLAS:	It seems to be, and the Union below certainly said they did not want to claim people outside this
list of callings.
TOOHEY J:	If you gave the Constitution a broad sweep that

it appears to have, then presumably there is no

real difference between Queensland and Western

Australia.

MR DOUGLAS:  Yes, and that was our submission below. It was

rejected and the Full Bench interpreted it in this

limited fashion. When one looks at the list of

callings, however, one can understand from them

that they certainly do cover a very large number of occupations within any normal State Public Service: accountants, architects, advisers, auditors - I am

selecting a few - computer programmers,

economists - and we all know how prevalent they are

in the higher reaches of government - editors,

engineers -	we have not yet been able to work out
what the role is of head attendants at asylums.	We
considered that to some extent below, but we
thought that that probably did not equate to
psychiatrists - journalists, legal officers,
marketing officers, systems analysts, et cetera.

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So there is a very wide range of employees

covered by this eligibility rule, even if it is

limited in the fashion the Full Bench said. The

way in which the Full Bench interpreted it led them

to conclude that it was in effect a collection of,

in the main, professional and semi-professional

callings.

Your Honours, having said that, could I also

then direct you to the terms of attachment A to

complete the evidence relevant to the second point

we wish to make on interstateness, which we will

come to later.

BRENNAN J:  Mr Douglas, before you leave that, could I take

you to page 5 of attachment Band to ask whether

there is any agreed construction of the proviso

which appears at about point 8 of that page?

MR DOUGLAS:  Is this the proviso, "NOR persons covered by

awards"?

BRENNAN J: Yes:

covered by Federal or State awards and

agreements or Federal or State determinations

of the printing industry.

Does "of the printing industry" relate to awards

and agreements as well as to determinations?

MR DOUGLAS:  I do not know that there is any agreed

consideration of that.	I do not know that we have
considered it before.

BRENNAN J: What does the POA cover if it does not cover

those who are already covered by federal or State

awards?

MR DOUGLAS:  One assumes that "of the printing industry"

covers federal or State awards of the printing

awards generally, but Your Honour has raised a	industry. That does not mean federal or State
point which I do not think anybody has thought of
before. My short answer to that is: I do not
know. Attachment A is part of exhibit H2 and
contains in this instance rules of the State Public Services Federation before it merged with the Professional Officers Association, so they were the
rules that were relevant at the ti.me of the service
of the log of claims. On the first page, you can
see from clause 3(A) that:

The Federation shall consist of an unlimited

number of employees employed by -

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(i) the Crown in right of any State or States

(other than the State of Queensland);

Those words, "other than the State of Queensland"

refer through subclauses (i) to (iv) and again in

clause 3(B) down the bottom of the right-hand

column and also about 12 pages further over in the

description of the industry in clause 4, Half-way

down the left-hand column there is a heading, "4.

Description of Industry". Under that is a
subclause (A) setting out the industries covered by
the federation.

So the simple conclusion from that is that there were two unions serving logs of claims. One

of them could not cover employees in Queensland;
one of them could. The one that served Queensland

did not serve a log of claims on respondents in

other States, but the one that could not serve

Queensland served the log of claims on respondents

in Tasmania and Western Australia. We will develop

our submission in respect of that factual issue

later.

Your Honours, we handed to the.Court Crier before lunch a further slim outline of submissions,

meant to be something to which we will talk, and

which really formulates in a more compressed

fashion some of the submissions we have already

made in our written submissions.

MASON CJ: Yes.

MR DOUGLAS:  We would like to commence with something that

arose in some of the exchanges between

Mr Justice McHugh and the Solicitor-General for
Western Australia, and it deals with the relevance to this dispute of the Engineers' case and, in our submission, the Engineers' case certainly remains

authority for the general principles of statutory

difficulty to do it in any meaningful way, because	construction expressed in it, but when you try to apply it to this case in modern ti.mes it is very	the later developments in the law have, to some
extent, marginalized it in the area of section Sl(xxxv), and that arises from two separate
developments. The first in time was the
recognition of the implications arising from the
federal nature of the Constitution, particularly
expressed in the Melbourne Corporation case. The
second in time was the radical reassessment of the
meaning of section Sl(xxxv) in Coldham's case, and
there has been some discussion about that already. In our submission, you have to look at the
Engineers' case facts to help realize the
significance of the difference and to try to

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compare it with the facts in this case shows why it

is really very difficult now to rely upon the

conclusions that were arrived at in that decision.

In Engineers there were more than 800 respondents, three of whom were, in effect, trading enterprises

carried on by the West Australian Government. So

there were three out of a very much larger number

of respondents.

The issue was whether persons employed in

those trading concerns, even though they were

employed by the West Australian Crown, could be

covered by a Commonwealth award, and the issue

turned, not on so much the fact that they were

public servants but, on the fact that they were

employees engaged in trading enterprises because at

that stage "industrial dispute", as is well known,

was limited. It came from a different dictionary

than it does now. It meant "disputes", in effect,
"in commercial or trading enterprises", not
disputes between employer and employee, as now is

the case. That is illustrated best, in our

submission, by the examination of the facts

conducted by Mr Justice Higgins, who formed part of

the majority, but who gave separate reasons, and

his analysis of the facts appears at pages 161 to

163, and you can see what was concerning His Honour

about point 7 of page 161, (1920) 28 CLR, where

His Honour says:

Putting on one side any difficulty as to the precise force of the expression "industrial disputes" (for we have here definite

industries carried on for profit and in

competition), it is clear that the expression

means the same thing whoever is the employer -

person or firm or company or State. Fitters

pass from an engineering firm to the

Government railway shops; they do the same

kind of work in both places; they claim the

same rates in both places; the dispute is the

same in both places; the union acts as to both
places.	It is quite as much to the interests

of the community to preserve the continuity of

operations in the railway shops as in the

works of the firm. The fundamental rule of

interpretatipn, to which all others are

subordinate, is that a statute is to be

expounded according to the intent of the

Parliament that made it; and that intention has to be found by an examination of the language used in the statute as a whole.

Now, His Honour also considered something

closer to the point we are concerned with at

page 171, and we should draw your attention to

that. This is in the first full paragraph on the

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page, about a third of the way down, where he is

really referring to the previous decision of

Collector v Day, and he says:

The position, therefore, is that even in

the country of its origin, the United States,

the doctrine of the exemption of State

activities from Commonwealth legislation is

held not to apply to commercial undertakings

of the Sate or created by the State, but to
apply to strictly governmental functions only,

of the kind which had been stated.

He refers back to something he had said on the

previous page and he says:

But, personally, I desire not to be understood as regarding the case of Collector v Day as applying to our Constitution even with the limitations which have been given to it bythe

subsequent cases. My view is that, on the

true construction of section 51, the State

activities which are not distinctly excluded

from the Federal powers by the Constitution

are subject to the Federal laws, to the full

extent of their meaning; and that there is no

exemption from Federal Acts unless and until

they pass beyond the limits of the Federal

powers on their true construction.

Now that perhaps is some sort of intimation of what

was developed later in Melbourne Corporation:

there is no exemption from Federal Acts unless

and until they pass beyond the limits of the

Federal powers on their true construction.

There is not much else in the decision which attempts to come to grips with what was discussed

in the Melbourne Corporation case, apart perhaps

from a passage at pages 143 to 144 in the judgment

of the majority judges, Sir Adrian Knox and

Justices Isaacs, Rich and Starke. And there

Their Honours do appear to consider that there may

be scope in another case in the future for the

reading down of the scope of Commonwealth power

which they applied in this decision. They said:

If in any future case concerning the

prerogative in the broader sense, or arising

under some other Commonwealth power - for

instance, taxation, - the extent of that power

should come under consideration so as to

involve the effect of the principle stated in

the passage just quoted from the Bonanza Creek

case, and its application to the prerogative

or to the legislative or executive power of

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the States in relation to the specific

Commonwealth power concerned, the special

nature of the power may have to be taken into

account. That this must be so is patent from

the circumstance that the legislative powers

given to the Commonwealth Parliament are all

prefaced with one general express limitation,

namely, "subject to this Constitution," and

consequently those words, which have to be

applied seriatim to each placitum, require the

Court to consider with respect to each

separate placitum, over and beyond the general

fundamental considerations applying to all the

placita, whether there is anything in the

Constitution which falls within the express

limitation referred to in the governing words

of section 51. That inquiry, however, must

proceed consistently with the principles upon

which we determine this case, for they apply

generally to all powers contained in that

section.

So, we say, and have said, that the decision is

difficult to apply in these circumstances, because

of the change in interpretation of the industrial

power. It is also difficult to apply, because it

did not really consider the implications arising

from the federal nature of the power, and we also

say that in one respect it was wrong and it follows

really from the discussion we have just read to you

misconstrued the effect of section 107 by making it subject to section 51,

and the proper reading of section 107 of the misinterpreted or

when clearly section 51, in its own words, is made

subject to the Constitution; section 107 forms part of the Constitution to which section 51 is subject,

and section 107 preserves State powers:

unless it is by this Constitution exclusively

vested in the Parliament of the Commonwealth

or withdrawn from the Parliament of the

State -

That appears to be have been recognized, to

some extent, by Sir Owen Dixon in the Melbourne

Corporation case, (1947) 74 CLR 31, at page 83.

BRENNAN J: That is preservation of concurrent powers, is it

not?

MR DOUGLAS:  Preservation of powers of the States is what

the section says. It has to be concurrent powers

because the - - -

BRENNAN J: It is a clear concurrent power.

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MR DOUGLAS:  Yes, it has to be from concurrent powers

because - - -

BRENNAN J:  - - - and in the event of the exercise, both by

State and Commonwealth of concurrent powers,

section 109 operates.

MR DOUGLAS:	Yes, but still preserves State powers.
BRENNAN J:	For what they are worth after the exercise of

Commonwealth power and the operation of

section 109.

MR DOUGLAS:  Yes. In our submission, too, it also helps

form the ground work for the conclusions reached in

the Melbourne Corporation case about the existence

of implied prohibitions on the extent of

Commonwealth power to the extent that they would

affect the continued existence of State

governments. That is really the effect of one of

the passages in Melbourne Corporation I was going
to take you to. It is at page 83. Sir Owen Dixon

says, about section 107, this:

For the attempt to reads 107 as the

equivalent of a specific grant or reservation

of power lacked a foundation in logic.

Accordingly the considerations upon which the

States' title to protection from Commonwealth

control depends arise not from the character

of the powers retained by the States but from

their position as separate governments in the

system exercising independent functions. But,

to my mind, the efficacy of the system logically demands that, unless a given

legislative power appears from its content,

context or subject matter so to intend, it

should not be understood as authorizing the

Commonwealth to make a law aimed at -

and we emphasize those words -

the restriction or control of a State in the
exercise of its executive authority. In

whatever way it may be expressed an intention

of this sort is, in my opinion, to be plainly
seen in the very frame of the Constitution.

His Honour said, briefly, before then, at page 78,

what the effect of the Engineers' decision was:

stripped of embellishment and reduced to the

form of a legal proposition.

It is that:

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The prima facie rule is that a power to

legislate with respect to a given subject
enables the Parliament to make laws which,
upon that subject, affect the operations of
the States and their agencies. That, as I
have pointed out more than once, is the effect

of the Engineers' case.

But we do submit that, apart from that, it is

very difficult to apply the Engineers' decision to

this one, particularly where it says that the

Commonwealth conciliation and arbitration power

enables the Commonwealth Commission to make awards

binding State governments, because the effect of it

really was that the Commonwealth Commission could

make awards binding persons employed in trading

enterprises of State governments and it did not

address the issues that have arisen here.

The only occasion on which, since Coldham's

case, that issue has arisen even marginally is in

Re Lee; Ex parte Harper. The application there was

an application for registration as a union and,

from recollection, the unions applying covered not

only government but non-government employment and

it was particularly made clear during the argument
in the case that no discrimination point arose. So

that, really, this case focuses attention as never

before on what is the appropriate test to adopt
since Coldham's case, taking into account the
existence of implications arising from the federal

nature of the Constitution.

In our submission, one useful test to apply in

approaching that problem is the passage from the Melbourne Corporation case to which we have just

referred. In our submission, this log of claims

can only be viewed as an attempt to create an award

whose aim is to restrict or control Queensland, in

that aspect of its executive power by which it

determines what it pays its public servants.

Queensland, of course; has legislated in the past

to exercise that power, most recently in the Public

Service Management and Employment Act, previously

in a series of public service Acts.

In our submission, interference with that

power creates a substantial interference with the

State's capacity to govern, to apply the test

Your Honour formulated in the Tasmanian Dam's case

at page 139 of that decision, and in our submission

it follows from the Melbourne Corporation decision

that if the aim or the object of the law is to

exercise control over the State by an actual
attempt to restrict or control the State in the

exercise of a function forming part of its

executive power it will be struck down, and that is

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the passage from Melbourne Corporation we have just

read.

McHUGH J: But how widely do you define executive power?

MR DOUGLAS:  In this case it certainly should cover all the

employees covered by the log of claims, able to be
covered by the eligibility rule of the Union, for
the reasons we outlined when describing their

nature.

McHUGH J:  You say it does, but upon what basis does one

decide that it does? What is the difference

between those employees and clerks, or for that

matter between bus drivers in a government

transport service?

MR DOUGLAS: That can depend, to some extent, upon the

nature in which the claim is made. We have said

initially here that if the aim appears to be to

control the State in the exercise of that executive

power, in our submission it should go wholly. If

there is a discrimination involved in the attempt

to create an award, again it should go wholly

because of the tests expressed in Melbourne

Corporation and Queensland Electricity Commission.

There may be a case that if it is an attempt to

create a general law which intersects with some

State government employees along with employees in

private occupations, that the law can stand. That

is really the effect of the decisions until now, if

you try to impose a benefit of hindsight on them,

because what has happened normally in the past is

that there has been a general log of claims

covering people in industry and in government doing

similar functions - generally speaking - and there

has been an intersection there, no discriminatory

effect of the law and perhaps not a burden imposed

on the government.

McHUGH J: But how do you draw the distinction, or what is

of the State are just as impaired by a general law the basis of the distinction because the functions like that as a special law or a special award.,

MR DOUGLAS:  I appreciate that, I am trying to formulate it

in reliance upon the decisions of the Court, and

the Court has recognized that that can be done in

the past.

McHUGH J: Cases are but illustrations of principle.

MR DOUGLAS:	Yes.
McHUGH J:	It is better to concentrate on the principles rather than the cases.

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MR DOUGLAS:  The proper principle, in our submission, is

that there should be no interference with the

capacity of Queensland to govern itself by the

Commonwealth, in terms similar to those formulated

by the learned Solicitor-General for Western

Australia when he was answering, or attempting to

answer, Your Honour's same question. If I could

then turn to - - -

McHUGH J: Just before you do, in one of the cases

Mr Justice Menzies referred to the "constitutional

functions" of government. Is that a test you would

accept or is that too narrow from your point of

view?

MR DOUGLAS: In our submission, that is too narrow. If one

thinks of constitutional functions perhaps as

relating to the legislature, the judiciary

certainly, and if it is to be limited simply to,

say, the higher levels of the executive, it would
be very difficult, one would think, to properly
control the government of a State if you only had

the governance of that handful of individuals. So,

in our submission, it could be too narrow.

GAUDRON J:	I must say I have heard what was said by the Solicitor-General for Western Australia, but there
is a big assumption about this, is there not, that
there is going to be an interference with the
government of a State?

MR DOUGLAS: Is this on the basis, Your Honour, that - - -

GAUDRON J: 

On any basis.

will be, if this application was disallowed, a
section lll(l)(g) application?

MR DOUGLAS: 

Is Your Honour considering the fact that there

GAUDRON J: Let us assume that an award were made with

respect to wage rates in conformity with general

wage fixing principles, which seems to me to be

about the only assumption you can look forward on.

MR DOUGLAS: Yes, but that still does not remove the fact

that the Queensland Government is then limited in

what it can do about the control of the wage rates.

GAUDRON J:  It is limited in what it can do in terms of

payment.	The log of claim claims only for
wages - - -

MR DOUGLAS: Yes.

GAUDRON J:  - - - and unless someone can tell me why I

should not approach it on the basis that an award,

if made, will be made in conformity with general

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wage fixing principles, I do not see what basis
there is for assuming an interference with the

function of governing.

MR DOUGLAS: Say, for instance, Your Honour, the Queensland

Government had been elected on a platform of

reducing public service salaries by 10 per cent,

and they were voted into Parliament. Because of

that election promise they went in. They passed

legislation to effect that and the Commonwealth

Commissioner said No, so they have lost their power

to that extent.

GAUDRON J: Yes, but it does not seem to me to have anything

to do with the functions of governing.

MR DOUGLAS: With respect, it does. It has reference to how

much money Parliament appropriates to the

government for expenditure on that topic.

GAUDRON J:  But that must be so with respect to the railways

awards.

MR DOUGLAS:	Yes.
GAUDRON J:	You have to put it that the fixation of a wage

in accordance with ordinary wage principles

operating throughout the community is an

interference with the right to govern.

MR DOUGLAS:  Yes, and of course, Your Honour, that really

assumes, for example, that the existing federal

arbitration power will continue to be exercised
into the future as it has been in the past, that

there will be normal wage fixation principles.

GAUDRON J: Although there are limitations to the notion of

arbitration. I mean, the very notion of

arbitration imports limitations that decisions will

be made reasonably, not arbitrarily, not

capriciously, not discriminatorily, does it not? Does it not carry all those limitations?

MR DOUGLAS:  It certainly does, but it reposes them in an

officer of another government. It is the function of the Queensland Government to determine how much

it should spend and how it should reward its public

servants. That is, in our submission, an answer to

a question Your Honour raised earlier about the

argument going to discrimination, and I think

Your Honour asked the learned Solicitor-General for

Western Australia how does it differ from an

ordinary employer. In our submission, you have to
take into account the nature of the respondent as
well because a State Government is not an ordinary

employer. A State Government is bound by other

constitutional rules, principles and laws of its

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own, both within the federal Constitution and its

own Constitution.

GAUDRON J: Well, you must make that point, must you not, in

relation to every single employee of the Queensland

Government?

MR DOUGLAS:	Yes, that is right.
DAWSON J:	Do you not draw a distinction between ordinary

wage fixing principles which do apply in the case

of some employees, and those employees for which

there are no ordinary wage fixing principles?

MR DOUGLAS:  Yes. With respect, Your Honour is correct. Of

course, there will be many persons in the positions

referred to in this log of claims who would not be

covered by ordinary wage fixing principles: heads
of departments and people like that, who are

presently covered by particular contracts entered

into -

McHUGH J: What about foreman of the printing shop? I

notice he is one of those that is caught up here.

MR DOUGLAS:  Yes, and no doubt the head of the Government

Printing Office as well, Your Honour. One of the

significant differences as employers which, in our

submission, highlights the discriminatory effect of

an award of this nature is the prohibition on a

State government spending money which has not been

appropriated, and that was referred to in the

Railways Union case which is referred to in our

outline.

In our submission, as well here one has to

consider that the power to determine the amounts to

be paid to its servants will be a particular

impediment on a State functioning as such, as a

State, where the log of claims is directed only at

officers of the Queensland Public Service and

amongst them is directed at in the main

professional or semi-professional callings from

heads of departments down. So in that sense as

well, there is a discrimination by the choice of

the subject-matter.

GAUDRON J:  What is the difference between the State and an

authority of this State for the purposes of your

argument, for example, Brisbane City Council which

is created by the State and performs a whole lot of

functions in Brisbane that are in other areas

performed by State governments. As I recollect it,

it provides the buses and the water and sewerage

and all sorts of things. Is there some of

distinction between State governments and their

creatures who operate at a local government level?

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MR DOUGLAS: There is an obvious distinction in the fact

that they are not performing services - - -

GAUDRON J:  But they do not appear in the Constitution. I

suppose that is one.

MR DOUGLAS:	Yes, and they also are performing services separately from the government of the State as
such. They are simply performing local government
services.

GAUDRON J: The consequence of your argument might be, might

it, that bus drivers in Brisbane can be regulated

by federal award because they are employed by the

Brisbane City Council, so long as they are combined

in a log with private bus drivers, but no bus

driver in a State who is employed by a bus

department could be covered by a federal award?

MR DOUGLAS: That is one possible consequence.

McHUGH J: Why do you say that? After all, in the Melbourne

Corporation case, the Melbourne Corporation was

held to have the benefit of the State

limitation - - -

MR DOUGLAS:	Yes, it was. There is a distinction perhaps here though that when you apply the conciliation
and arbitration power, there is no employment by
the State government in any fashion of a city council bus driver. There might be, in the cases
of some statutory authorities, employment by or on
behalf of the State government.

GAUDRON J: Yes, but I am looking to the fact that they are

creatures of the State government.

MR DOUGLAS:	They are employees of a body created by the State government. They are not in themselves
employees of the Crown or the State government. So
there is no doubt a possible distinction there.
Might I say, too, that the example of freezing
government salaries is not one plucked out of the
air.  I think there was a Western Australian
statute referred to in the evidence below which did
have that effect.

GAUDRON J: Could I just stop you there. I am sorry, I am

troubled. What is the difference between the

harbour boards? When we look at the State

government, do we look just at the State government

itself or do we go back to these notions of

instrumentalities having the shield of the Crown?

MR DOUGLAS:  Yes, if the Harbour Board is a representative

of the government of the State, its employees

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presumably are employed either by or on behalf of

the State.

GAUDRON J: So, on your argument, in the case of every

instrumentality there would have to be an analysis

as to whether the shield of the Crown, to use that

expression, applies, or whether they are agents of

the Crown -

MR DOUGLAS:  I think the West Australian case covers

instrumentalities to a large extent. Many of the

West Australian Crown instrumentalities are

respondents to the log of claims. We do not have

that situation in the log of claims against us.

GAUDRON J:  No, but your argument does extend to them if

they were - - -

MR DOUGLAS:  Yes. And one of the principal reasons why it

does extend to them focuses on the aim of the

servers of the log which really can only be, in our

submission, an aim directed towards control of the

State government. It makes no sense otherwise.

GAUDRON J:	I can read it another way.
MR DOUGLAS:	But, Your Honour, it only seizes upon State

government employees in their capacity as State

government employees.

GAUDRON J: Yes, well if there is a log of claims directed

to the BHP it only seizes on the BHP in relation to

its employees in their capacity as employees of the

BHP - - -

MR DOUGLAS:  Yes, but there is no constitutional prohibition

against the Commonwealth law aiming to control BHP.

GAUDRON J:  No, but the question is the aiming to control -

there are other ways of reading it.

MR DOUGLAS:  Yes. If I can leave the question of aim, can I

also remind Your Honours that that is not the only

determinant, because it is also the case that if

the substantial effect of a law is to discriminate

against a State, or the States, or a particular
State, then it also will be struck down.

Justice Deane made that point in the Queensland

Electricity Commission case, (1985) 159 CLR, and

the relevant passage is on page 249, towards the

foot of the page in the last paragraph, His Honour

says:

Nor is the question whether an impugned

resolution merely by reference to whether the

law relevantly discriminates against the

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formal criterion of its operation satisfies

the requirements of some formularized test.

The fact that the formal operation of a law is

to impose a burden or disability upon the

States or State instrumentalities by reference to their character as such will ordinarily

suffice to establish that, as a matter of

substance, the law relevantly discriminates

against the States. The failure of a law to

operate by reference to such a formal
criterion of liability will not, however,
preclude a conclusion that, as a matter of
substance, the law relevantly so

discriminates. That question of substance

must ultimately be resolved by reference to

the actual operation of the law in the

circumstances.

And perhaps I should read the rest of it as well:

If, as a matter of substance, the actual operation of the law is to discriminate

against the States or a particular State in

the relevant sense, it will be within the

scope of the reservation regardless of how

disguised the substance may be by ingenious

expression or outward form.

We do not accuse our learned friends of disguise here. They have made a full frontal assault, or

have attempted to and, in our submission, they

should not be allowed to.

GAUDRON J: And in your submission, that is because the log

is directed only to State governments?

MR DOUGLAS: Yes, that is one of our submissions.

GAUDRON J: But the discrimination arises for that reason?

MR DOUGLAS:

Yes, for that reason. We also adopt the

submissions already made in respect of section 121

of the Industrial Relations Act. We also say there

is discrimination because of the nature of the

employer which is, in a way, restating the first

point and the nature of the employer is different

from an ordinary employer.

The next submission we wish to make, Your Honours, is made already to a large extent in

our written submissions and that is the submission

relating to interstateness or whether the dispute

is one in truth extending beyond the boundaries of

a State.

In our submission, because of the peculiar

nature of the circumstances which existed at the

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time of service of the log, there is no common

dispute, claim or cause between the employee

organizations. I have already pointed out why we

say that on the facts because the coverage of the

Union which served the Crown in Queensland was

limited only to Queensland. The Union would serve

the other State Crowns, it could not cover

employees of the Queensland Government.

So there is no commonality there in potential

for employing or having as members people in common

between the Union. So that, really, all that they

have in common, perhaps, is sympathy with each

other's aims and, in our submission, that should

not be confounded with material interest which was

said in Jumbunna, one of the earliest decisions on

this point, in Mr Justice Barton's judgment, from

recollection, at about page 342. It is in

(1908) 6 CLR 309, at page 342.	I am reading now
from the sixth line down:

Surely disputants in different States may make

common cause to defend a common interest when

it is attacked or threatened, provided that

mere sympathy is not confounded with material

interest.

In our submission, these unions can only have

sympathy in common with each other, they have no

material interest in each other's claims because

they cannot cover the employees, the people whom

they have logged.

McHUGH J: Except that wage rates in one public service can

have an effect on employers in other. They may

want to transfer employment and move to the higher

paying States, in the same way as wage rates can

effect competition among employers.

MR DOUGLAS: In our submission, though, that really falls

into the category of a sympathetic interest rather

on your side. than a real interest in the other disputing party,

McHUGH J:  I think we are permitted to know that in recent

times there has been a wide movement of senior

public servants from State public services to
federal and vice versa and from one State public

service to another.

MR DOUGLAS:  Yes, I think one could conclude that on common

knowledge.

BRENNAN J: Mr Douglas, what was the situation so far as

coverage is concerned as at the date of the finding

of the dispute - - -

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MR DOUGLAS:	By then there had been a merger.
BRENNAN J:	- - - and does your argument propose to come to

that?

MR DOUGLAS:  Yes, by then there had been a merger of the

Union but, in our submission, that does not affect the question whether or not there was a properly constituted dispute. If you look at the log of

claims again, the dispute -

BRENNAN J: What was the coverage as at that date of the

merged Union?

MR DOUGLAS: 

In effect, the merged Union covered people in

these callings in Queensland still and it also
covered people with the callings relevant to

Western Australia and Tasmania in those States. So

the callings remain the same.

BRENNAN J: But the coverage was a simple agglomeration of

the two coverages of the constituent unions?

MR DOUGLAS:  Yes. So in effect had the old rules of each

organization stapled together basically, but they

formed one union.

BRENNAN J:	No change in the text of the coverage clauses?
MR DOUGLAS:	No material change that I can think of.

BRENNAN J: Yes.

MR DOUGLAS: But, in our submission, one has to focus on

whether there was a dispute giving rise to

jurisdiction in the Industrial Relations Commission

and the dispute is created on the case sought to be put forward by the respondents in reliance on their

log which reads, and this is on page 173 of the

application book:

Failing the granting of these claims or a

settlement of these claims within seven days

from the date of this letter of demand, it

will be assumed that the claims have been

refused and a Registrar will be
notified ..... of the existence of an industrial

dispute within the meaning of the said Act.

Now, at that stage the unions were still in their

unmerged form and we say you would have to focus on

the condition then and the fact that they may have

merged later cannot enliven jurisdiction in the

Commission when the jurisdiction depends upon the

existence of a dispute, when at the time of the

dispute the situation was affected by the

limitations to which I have referred.

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DAWSON J:  I am not sure that I follow, Mr Douglas;

originally, the claim in Queensland was with

respect to a limited number of employees of a

broadly professional type. That was because of the

eligibility clause of the POA.

MR DOUGLAS:	Yes.
DAWSON J:	The claim in Western Australia would cover

employees of that type, but also employees of a

much wider range?

MR DOUGLAS:  Yes, but not in Queensland, because the

eligibility rule of the Union said, "except in

Queensland" in its rule, so they could not cover

Queensland employees.

DAWSON J:  I see, so it may cover, for instance, draftsman,

if that is one of the professional classifications,

but only - I do not follow that. After the

amalgamation it would cover both Queensland

draftsmen and Western Australian draftsmen.

MR DOUGLAS:  As long as draftsmen were in both sets of

eligibility rules. ·

DAWSON J: Where is the exclusivity after the amalgamation?

MR DOUGLAS:  I am sorry, Your Honour.

DAWSON J: Where is the claim, exclusively Queensland, after

the amalgamation? I mean, the claim in Queensland

only concerns Queensland employees, but the class

of employees in Queensland in relation to which a
claim was made is a class of employees in relation

to a claim which was made in Western Australia.

MR DOUGLAS:  But not at the time of the dispute finding -

not at the time the dispute was - - -

DAWSON J: Afterwards.

MR DOUGLAS: Afterwards?

DAWSON J: Yes.

MR DOUGLAS: But, in our submission, you have to focus on

when the dispute was created and see what the

condition of the parties was then.

DAWSON J:	Why?
MR DOUGLAS:	Because the jurisdiction of the Industrial

Relations Commission depends upon the existence of

a dispute.

DAWSON J: Under the section or - not generally - - -

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MR DOUGLAS: Well, really under the Constitution and under

the section.

DAWSON J:  I mean, the dispute can widen, can differ, can it

not, as time goes by?

MR DOUGLAS:  The dispute can be widened, but there must be a

dispute to be widened, and our submission is that,

relevantly speaking, there is not a dispute

extending beyond the boundaries of a State, because

this log of claims cannot give rise to one.

DAWSON J:  Why can it not extend beyond the boundaries of

one State, because the two bodies become one?

MR DOUGLAS:  Because those two bodies who have become one

might be able to initiate one then, but they are

now trying to rely upon one initiated at an earlier

stage, when they were two separate bodies which had

no congruence of membership.

DAWSON J: Very formal, the whole thing, is it not?

MR DOUGLAS:  It is formal, yes, and it can be rectified, no

doubt readily by the Union serving another log of claims, but we are here fighting this case at the

moment, and in our submission the point is good

because at the time of the service of the log of

claims there was no interstateness vis-a-vis

Queensland. And I might say that this issue only

affects Queensland because Western Australia and

Tasmania were served by the one Union which had

power to cover members in both States.

GAUDRON J: But does not the presence of the new amalgamated

body here today indicate that that new body is
pursuing, and hence adopting and asserting as its

own what was previously asserted, and does not your

presence indicate that you are denying it?

MR DOUGLAS:

Yes, but, in our submission, it cannot by that

means only make something real which was not real

originally.

Can we then go on to a passage in Lee v Harper

on this topic, in the judgrnemt of the Chief Justice

Sir Harry Gibbs, (1986) 160 CLR 444, and I am still

concentrating on the interstateness element of the

submission. There is a passage in His Honour's

decision there, in the second-last paragraph, where

he raises a question and does not answer it but

which, in our submission, does come up for

consideration here. He says:

In particular, the questions whether it is possible to have a genuine interstate dispute involving the officials of one State who are

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\	doing no more than carrying out the
administrative services of that State, and
whether the artificial doctrine concerning paper disputes needs modification in the light
of the illumination thrown on s. Sl(xxxv) by Reg. v. Coldham: Ex parte Australian Social
Welfare Union, remain open for definitive
discussion.

Could we focus on the first part of that sentence,

where His Honour asked:

whether it is possible to have a genuine

interstate dispute involving the officials of

one State who are doing no more than carrying out the administrative services of that State.

In our submission, this log of claims in the

factual circumstances which gave rise to it, focus

attention on that because here you have a Union,

which relevantly is only covering Queensland

employees because it has not served New South

Wales, seeking to have an interstate dispute

involving officials in Queensland, who, when you
look at the log of claims and the list of callings,

one suspects a person is doing no more than

carrying out the administrative services of that

State, so that, in our submission, that dispute

should not be regarded as one extending beyond

Queensland. To do so would be artificial and would

be an extension of the constitutional power beyond

a sensible application of it.

We adopt the submissions made on behalf of Western Australia, about the genuineness of the

dispute and simply say, on top of what was said by

the learned Solicitor-General, that the word

"genuine" focuses attention on the need to have a

demand for terms and conditions of employment which are wanted for themselves, not because the employer

or employees have some other motive, and the

traditional motive might be that an employer might

wish to change the coverage of his employees from a

State Union to a federal Union, but not wish to

change the terms and conditions of employment.	A
dispute provoked in those circumstances may well

not be genuine if there is no wish to have improved

terms and conditions of employment, and it requires

a focus, not only on the question of whether the
genuineness extends to an interstate component of

the dispute, but as to whether there really is

disagreement between the employer and the

employees.

Finally, can we say that the limited

eligibility rules to which we have referred also

show that there is no community of interest among

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the public servants in the three States so as to

found a genuine dispute. They are our submissions,

if the Court please.

MASON CJ: Thank you, Mr Douglas. Mr Solicitor for New

South Wales?

MR MASON:	Your Honours, it was thought convenient at the bar table that I should follow, but I propose to
say what I wish to say by way of intervention in
the SPSF case first.  There will only be about one
minute left in the other case once I have dealt
with what I wish to say in the present case. Do
Your Honours have an outline of submissions of five
pages in length that were handed up today?

MASON CJ: Yes.

MR MASON:  Your Honours, we adopt the submissions of the Solicitor-General for Western Australia. We would

submit that there is essentially no difference

between money, property and people when it comes to

the description of each as means whereby both State

and federal governments carry out their

constitutional functions. Within limits, any

interference with any of those three agencies is

capable of amounting to an unconstitutional

interference if it otherwise satisfies the
appropriate tests based upon the federal

implications.

This Court has recognized the integrity of the

State's need to raise money and the integrity of

the State's position as owners of vital pieces of

real estate, such as court-houses, Parliament

houses and the like, and what the present case, the

SPSF case, really involves in the post-Coldham era,

when it may be recognized that a dispute is

industrial, even, for example, if it involved the

pay rates of judges, today would be regarded as an

certain people as agents of government in carrying industrial dispute, nevertheless the position of	out constitutional functions which have their
support in the Constitution itself is such as to
create an immunity from the exercise of the section Sl(xxxv) power.

Your Honours, the findings in the SPSF case

make no attempt to draw what is admittedly a

difficult line which recognizes that constitutional

reality. This is not, in our submission, a return

to the discredited notion of essential governmental

functions or Lord Blackburn in the Combe case.

McHUGH J:  Lord Watson. I said Lord Blackburn; I think it

was Lord Watson.

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MR MASON: Lord Watson. It is a recognition of that which

the Constitution says is essential, namely the

States as governmental organs. Your Honours,

whilst the present case, the SPSF case, involves a

claim for money alone and perhaps attracts the

comment that fell from Your Honour Justice Gaudron

that why should the Court assume that the wage

fixing will be other than in accordance with
appropriate principles, because of the breadth of
the coverage of the unions concerned, we are
contemplating the possibility of a federal body

fixing the wages of the highest organs of the

governmental functions of the States, both

legislative, judicial and executive. But the case

also creates - - -

GAUDRON J: Providing, of course, that they are employees.

MR MASON: Well, for the time being, because of that

limitation being in the Industrial Arbitration Act,

but -

GAUDRON J:  It might be imported by the terms of Sl(xxxv)

itself.

MR MASON: It might be, without, of course, presumably

letting in by the back door what the Coldham case,

as it were, closed at the front. If the Coldham

case really means that that which is industrial is

that which appears to the man in the street - and I

am referring to the passage at 311 - presumably the

man in the street today, rather than the man in the
street in 1900 would regard as an industrial

dispute, then why should one confine it to persons

who can be characterized necessarily as employees.

But even if one does confine it to employees -

GAUDRON J: Well, at the moment one must, must one not,

given the definition in the Act?

MR MASON:  Yes. They would include employees at the highest

level of the executive arm of the government and

employees who were involved in assistance to those

who were at the highest level of any of the three

arms of State government in the exercise of their

constitutional functions, and whilst the present

case is confined to monetary matters, the
principles involved, as we perceive this case

involves, must encompass the fact that the

award-making power of the Commission _can extend to

the range of matters referred to at the top of

page 2 of our outline, which must necessarily mean

that one is contemplating a Commonwealth body being

armed with power to go well above any financial

bottom line, but effectively controlling the whole

gamut of how the State organizes its governmental functions through its necessary agency of people.

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Your Honours, in our submission, in

paragraph 6, we refer to a passage in Your Honour

Mr Justice Brennan's judgment in Tasmanian Dam,

158 CLR 1, at page 214, where Your Honour said that

the Commonwealth legislation in this case, striking

as it did at portions of the wastelands of

Tasmania, is distinguishable from Commonwealth

legislation that struck at, for example Parliament

House and the supreme court, and we would say that

if a federal implication can say that real estate

must attract in an appropriate case an immunity

from Commonwealth overriding, or acquisition, if it

would have the effect of impairing the exercise of

constitutional functions then why are people to be

treated any differently?

Your Honours, it may be said, and in one sense

Your Honour Justice Gaudron's question, "Well, why

do we assume this will not be done according to

fair and reasonable principles?", raises this

issue; well, the impact is only very slight, so why

should the State be concerned, as it were, at

drawing the line at this stage.

The QEC case addressed this to some extent and

we have given Your Honours three passages at the

bottom of page 2 of our outline, and in particular

in the judgment of Mr Justice Gibbs, 159 CLR 192,

at pages 208 and 209 where His Honour said, about

point seven of the page:

to leave it to the Parliament to decide that

discrimination against a State is necessary to

achieve the settlement of a particular

industrial dispute would be to erode the whole

principle established by the cases to which I

have referred. The exception indicated by

Dixon J. relates to the nature of the power or

the provision conferring it and not to the

circumstances of a particular case which might

be thought to justify particular

discriminatory treatment of a State.

There, of course, that is talking of the discrimination exception, but the rationale which

His Honour - - -

GAUDRON J:  It does seem to me that - to interrupt you on

this point - there have been assumptions in the

argument that are not necessarily correct; for

example, I think the Solicitor-General for Western

Australia referred to it as an administrative

organ. I accept it is not a court, has not been a

court and so on, but the Commission is not, at
least in legal theory, a bare administrative organ

of the Commonwealth. And the States, for example,

have been the Crown - let us talk about the Crown,

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if you like, has been subject to the authority of

the courts and, indeed, section 64 of the Judiciary

Act, a Commonwealth law, a federal law,

specifically subjects the courts to certain

consequences in so far as federal jurisdiction is
involved. If you look at the Commission as

something other than an administrative body,

something that is not a court but operates in much

the same way, why does one not start asking the

same sort of questions about it as you would ask

about the subjection of the States to the authority

of the courts?

MR MASON:  The courts administer the law whose validity is

assumed, unless challenged on constitutional

grounds. The Commission creates law within the

authority given to it by the Industrial Relations

Act.

GAUDRON J: And the Grants Commission? I suppose you do not

have to accept the grants?

MR MASON:  I am sorry, I am not - - -

GAUDRON J: No, do not worry about that.

MR MASON:  Are you inviting me to put submissions about

section 96, Your Honour?

GAUDRON J: These are matters which, really, to my mind,

tell on the precise nature of any limitation or

implication that is to be drawn from the

Constitution in this area.

MR MASON:  But we are ultimately talking of a limitation

upon the law-making power of the Commonwealth

Parliament because - - -

GAUDRON J:  I know that is how it has been said and, in one

sense, that is correct but, at the end of the day,

you are talking about, and your submissions in

terms are talking about, what the Commission will

or might do within the general authority conferred

upon it.

MR MASON:  The difficulty, from the States' point of view,

is that when the Commission makes an award, the

award, as it were, relates back to the Act and

thereby attracts section 109 superiority over State

law over a wide-ranging area of scope and thereby

affects legislation and through that means affects

the way the State Parliament has ordered the

exercise of its constitutional functions and the

way it has ordered its own legislative, judicial

and executive arms.

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So to say that the Commission is obliged to

act fairly, justly, is really no comfort, with
respect, to the States. One assumes that. The

question is whether the federal Parliament has

power to subject the States to that regime.

DAWSON J:	One really does come in at an earlier point, does one not, and one does not look to implications.
You would concede, I suppose, that there are a
number of persons employed by the State who are
employed in an industry and who could be covered by
an award of the Commission; nurses, railway workers and so on.
But at some point you come to employees between whom and the State there is a special
relationship and even if you regard that relationship as industrial, in a sense, that is it
is an employer/employee relationship, it is so
special that it is not the same relationship as the
relationship with an employee of equal level in another State. And this is bound up with the idea
that the States are autonomous entities and,
therefore, do have control in a very special sense
of those people at that level of employment.

So you say, from this, simply that you cannot

have an interstate industrial dispute when you are

dealing with separate entities with that degree of

autonomy in relation to employees at that level.

You need no implications, it is just simply that

the restriction is to be found in (xxxv).

MR MASON:  Well, they are the State when carrying out

particular functions.

DAWSON J:  That is another way of putting it. I mean, this

has been popping up all through the discussion.	Is
that not really the proper way to look at it?

MR MASON:

If one were analogizing from company law, they

would be the company doing it rather than agents of

the company.

DAWSON J: The board of directors.

MR MASON:  Yes. Now, there is difficulty in drawing the

line, but in the present dispute finding function

no attempt was made to do so, and in the

submissions put by the respondents the assertion is

that the CYSS case means it does not matter any

more, that provided you can characterize the

dispute as industrial as you would, as I have

submitted, for a judges' pay dispute, that is the

end of the matter, perhaps subject to them being

employees. But we submit that the federal

implication reads itself back into the power

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itself, and in the Queensland Electricity case the

rationale, as we read it, for the

anti-discrimination principle which was stated

particularly at pages 208 and 209, 234 and 235 in

the judgment of Justice Brennan, and 248 in the

judgment of Justice Deane, is that one reads the

grant of power as itself being subject to a

non-discrimination principle which recognizes the

federal nature of the Constitution.

DAWSON J: But that is not answering the point I was putting

to you. I am not talking about discrimination.

MR MASON:	I appreciate that, but I am -
DAWSON J:	I am not talking about even not harming essential

governmental functions. I am just saying that if

they are unique, which is the foundation of most of
the argument we have been listening to, then you

cannot have an interstate element in it. Well now,

what do you say about that?

MR MASON:  I certainly adopt that. That is one of a number

of means whereby section Sl(xxxv) does not apply.

DAWSON J:  But is it not what really underlies it all? I

mean, if you say that the relationship of employees

at this level -

MR MASON:  The principle that underlies it all is the

integrity of the States and the recognition of that

by the Constitution. The means whereby we

recognize that is either to say they are not

interstate - - -

DAWSON J: But implicit in that argument is that each State

has its own integrity.

MR MASON: Yes.

DAWSON J:  You do not have the integrity of the States as a

whole. You are talking about the integrity of the

individual States, and that will differ from State

to State, and therefore you cannot have an

interstate dispute when you get to a certain level

of relationship between the State and an employee.

MR MASON: Well, of course, it speaks of spreading beyond

the confines of one State, and if we put all our

eggs into that basket that Your Honour is offering

me - - -

DAWSON J: Yes, I understand that.

MR MASON:  - - - one could perhaps envisage situations where

two States would be perhaps carrying on activities

perhaps in the one State.

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MASON CJ:  How are you putting it - as no interstate

industrial dispute, or are you putting it as a

limitation on the authority and power of the

Commission to settle such a dispute?

MR MASON:  I was embracing the offer from Justice Dawson,

but the way I was putting it and our preferred way
of putting it would be to say that the federal
implication means that one reads Sl(xxxv) as not
authorizing the settlement of disputes, even though

they be industrial, if they strike at the States

either in a discriminatory way or in a way that

undermines the capacity of the State to function. administrative services of the State is perhaps a slightly inexact way of recognizing the fact that

certain people when performing certain functions in

either executive, legislative or judicial work, are

themselves performing the State's work, and in

doing that - it is quite different from the State

having extended itself into a particular activity

such as a commercial activity.

The principle which we are seeking to describe

would extend to a departmental head, for example,

whether or not that person was at the time

directing a traditional function, such as police,
or a non-traditional function, such as a trading

enterprise, or a purely private function, such as a

government department that was regulating some

private industry. The important thing is that a

governmental function is being performed, however

one describes governmental function, and we are

content to put it as being a governmental function

that is recognized in the Constitution; something

that is so close to the role of being a State, that

it derives its support from the Constitution

itself.

BRENNAN J: This rather sounds like a kind of board of

directors argument, and if so, then the scope of

the immunity which you seek is extremely limited,

is it not?

MR MASON:  No, because directors need assistance too.

BRENNAN J: Well they may, but is there any reason why, if

the argument is as you have just put it, there

should be any immunity to the purchase of

assistance - the hiring of people who can render

that assistance?

MR MASON:  Well, if those persons are being engaged to

assist in the performance of constitutional

functions, then certainly they would, on this

argument, be outside the scope of section Sl(xxxv),

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such that an award could not be made preventing

their dismissal, for example.

BRENNAN J: Well, I do not quite appreciate at the moment

why that should be so. I know the analogy is

imperfect between the classes of public servants

whom you ..... in this argument is intended to

embrace and directors, but a director might have a

typist.

MR MASON:  Yes.

BRENNAN J: One would not think for a moment that it would

be beyond the power of the Commission to settle an

industrial dispute involving typists, just because

this typist was working for a director, whereas

another typist is working for an invoice clerk.

MR MASON:  Yes.

BRENNAN J: But, as I understand it, you say that there is a

difference in government. Why is there such a

difference, if your argument is, as I understand

it, limited in that fashion?

MR MASON:  Yes, well I certainly put it in an alternative

way. Obviously, if I am driven back to the

departmental heads, the board, that is where I

would remain, but the principle is that what puts a

restraint on the federal power is the capacity to

control the way the State exercises constitutional

functions, be it exercising it through money,

people or land, and if the particular award

threatens to impinge upon that freedom to exercise

it as the State would wish to do so, then it does

extend to secretaries, on that argument.

Just as, perhaps to take a more familiar

example, it would extend to a judge's associate.

If one asks is the integrity of the court affected

if certain external control over the dismissal of

an associate were imposed, the answer might be

"Yes", and that flows from the function the person

is performing in relation to the State or the

Commonwealth, and that function being described as a judge's associate rather than the function of typing or whatever an associate might otherwise do.

DEANE J:  You still have not answered the Chief Justice's

question. I mean, say, for example, this dispute

escalated until all the public servants in every

State of the Commonwealth were out on strike, would you say the Commission has no power to deal with

that dispute and to order people back to work even
though, I would have thought it is obviously an

interstate industrial dispute, or would you say the

Commission is limited in the orders it can make in

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terms of the exercise of its conciliation and

arbitration powers or both?

MR MASON: 

It would have power to find a dispute in relation

to those persons who are not themselves performing
these constitutional functions for the State.

DEANE J: But the dispute is about the failure to accede to

the log relating to the people who are employees of
the three States, and the only people who are out

on strike are all the employees of all the States.

MR MASON:  I would still say that - if you are asking me

whether there could be an award that would embrace

all of the employees - - -

DEANE J: No, what I am asking you is: do you say that

there is no relevant interstate industrial dispute

even then, or do you say that the Commission has no

jurisdiction to deal with that interstate

industrial dispute, or do you say what the

Commission can do in dealing with that interstate

industrial dispute is limited?

MR MASON:  It is the last of those. I am assuming, of

course, that the genuineness point is overcome?

DEANE J: Yes.

MR MASON:  Yes. In the present case the Cornrnission has not

attempted to differentiate between the persons and

the functions whom it can embrace within its

award-making powers.

GAUDRON J: But why would it? If the only question it has

had to answer so far is whether there is a dispute,
on your argument or on your concession, the

limitation is not one that stops a dispute corning into existence; it is one on the exercise of the

powers of conciliation and arbitration.

MR MASON:  But as I understand the facts here, the

Commission has found a dispute that involves all of the employers and all of the employees within the

scope of the membership rules. At that point of

time it has misdirected itself because it has, in

effect, asserted power to make an award that would

include - maybe we are debating the form of relief

that is appropriate.

GAUDRON J:  You may be talking about the time, too, at which

relief can be sought.

MR MASON:	The prohibition - I think it is called prohibition quousque - can go in order to direct
and confine - - -

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GAUDRON J: Because what you are talking about on your

concession to Justice Deane, as I understood it,

was the limitation on the power of conciliation and

arbitration arising by implication from the

Constitution.

MR MASON:	Yes.
McHUGH J:	On that basis, we should not have much trouble

disposing of your own application in the next case.

MR MASON:  I told you it would be very short, Your Honour.

We do not say that any of the employees within the scope of that dispute are within the constitutional functioning of the State.

GAUDRON J:  I must say, I should put you on notice, I will

want to know in that case, having referred the

matter to a Full Court, what the provisions are

about awarding costs.

MR MASON:  There is another point in that case and I will

come to it.

GAUDRON J: There is?

MR MASON:  It is not quite that short but I will be covering

it in these submissions. Your Honours, at the

bottom of 208 and 209 in the Queensland Electricity

case, there is a statement by the Chief Justice

and, as Your Honour Justice Dawson pointed out, he

is dealing with discrimination at this stage but I

am seeking to make more general use of it. These

federal implications, if they apply, apply, in our

submission, at the outset. There is not to be a

slow destruction of the States and they go to the

exercise of power.

In paragraph 8, Your Honours, we have referred to some authorities which I certainly shall not

read about the lack of the Commonwealth legislative

power to commandeer the law making executive and

judicial powers of the State and we submit that the

same principle really informs the limitation which

survives in Sl(xxxv) post the Coldha.m case. That

same principle also finds a parallel or a

reflection in the doctrine relating to

section 77(iii) and the fact that when vesting

federal jurisdiction in State courts the federal

Parliament must take the State courts as they find

them, within limits.

We say that the same principle relates to

raising of money, that the power to raise taxes
itself does not extend to reaching into the
exercise of the constitutional powers of the States
and there is a reference to a defence case where

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the defence power, itself, was held not to carry
with it the power to control government

administration.

Your Honours, in the passage in Lee v Harper

which has been read, there are two points which we
would wish to address: the first is the suggestion

by Your Honours that the sort of submissions that I

and others are making today are an attempt to

breathe life into the discredited notion of

essential and truly governmental functions. That

notion has been discredited, in our submission, as

a guide to what is the shield of the Crown. It was

discredited in the Professional Engineers' case as

a guide to what is industrial and non-industrial,

but it cannot be discredited if the notion itself

is reflected in the federal Constitution, and if
the States are recognized in the Constitution and

the three arms of government of States are

recognized there, then there is the necessity to

grapple with its implications.

In Professional Engineers' itself, 107 CLR at

page 275 point 7, Mr Justice Windeyer, in our

submission, recognized the very distinction which

Your Honours in Lee v Harper were, with respect, overlooking. At page 275 - and the judgment
contained lengthy discussion about how States

extend and contract their role, and how one cannot

use that notion, but at 175 point 6 or 7,

His Honour said:

This is not to say that there is not a difference between the industrial and trading

activities of government and its other
activities. There is, and it is fundamental

to this case. The fallacy lies in supposing

that this difference can in some way to be

made to correspond with a distinction between

functions which are properly or essentially

governmental and those which are not.

Elsewhere in the judgment His Honour had made it

very plain that the army and the police were

themselves to be seen as outside of the industrial

power.

Your Honours, in this judgment, and in one or

two other judgments, Your Honours referred to the

American Supreme Court decision of Garcia, and I think Your Honours will have a copy of the judgment

in the bundle of papers I handed up; that is Garcia

v San Antonio Metro, (1985) 469 US 528. That is

the judgment in which the Supreme Court reversed,

National connnerce power the congress had the power and

by a 5:4 majority, an earlier decision,

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authority to pass labour standards which were

is perhaps to be found at page 1037 in the

applicable to the San Antonio Metropolitan Transit majority

lawyers edition, or 556 US, in the short paragraph

commencing:

Of course, we continue to recognize that

the States occupy a special and specific

position in our constitutional system. That paragraph summarizes a number of pages of the

reasoning of the majority judgment and, in effect,

what they are saying is that under the American

system the States are protected through the role

that they play in the political framework of

government in the United States.

McHUGH J: Well, that is just reflecting the Engineers'

doctrine, is it not? That is what the High Court

said in the Engineers' case, and rely on the

political arena.

MR MASON:  Yes, and my submission is that this Court has

always taken a firmer view of the judicial function

in protecting the States and protecting the

Constitution.

In the minority reasoning at page 1044, 469 US

567, the judgment of Justice Powell, is a sentence:

The States' role in our system of government

is a matter of constitutional law, not of

legislative grace.

And that is the principle which we submit this

Court has followed and this Court should follow in

these sorts of matters.

Your Honours, the remaining matter addressed

in paragraphs 11 and 12 of our submissions is the

matter which is common to both sets of proceedings

and it is an argument that section 6 and 121 of the

Industrial Relations Act, together indicate that that Act discriminates against the States, because

it effectively insulates the Commonwealth Crown

from the operation of the award-making powers of

Conciliation and
the Commission. Under the subject to that Act, but that occurred by implication because of the definition of

"industrial dispute", which made it plain that it

included disputes relating to employment relations

of people in the Crown.

However, federal employees were always dealt

with under a separate Act, which was called the

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Public Service Arbitration Act of 1920, which had a provision, section 22, which corresponds with section 121 of the Industrial Relations Act.

McHUGH J:  But could I ask you to define "discriminatory" in

that passage because there cannot be any

discrimination, can there, unless there is an
equality between the Commonwealth public servants

and the State public servants? It is contrary to

your major argument.

MR MASON:  The equality is between the Commonwealth Crown as

a public sector employer and the State Crowns, who

are, in one sense, competitors but, certainly, on a
par as public sector employers. What section 121
of the Industrial Relations Act brings about is the
fact that the award-making power of the Commission

can, at the will of the Commonwealth executive, be

frustrated, whereas the State Crown does not have

that benefit and, therefore, on the face of the

Industrial Relations Act is a discrimination. It

is a different sort of discrimination to that which

was dealt with in QEC because it is a

discrimination where the States have been singled

out for differential treatment, vis-a-vis the

Commonwealth.

We do not argue that every time that occurs

there is an unconstitutional discrimination because

some powers such as tax necessarily import that

capacity to discriminate. But if one looks at the

early statements of the discrimination principle,

and if I may just read them on to the record - in

West v Commissioner of Taxation, 56 CLR 657 at 682,
Justice Dixon; Melbourne Corporation,
(1947) 74 CLR 31 at 79, Mr Justice Dixon; Victoria

v BLF, (1982) 152 CLR 25 at 93, Mr Justice Mason, and Tasmanian Dam, 158 CLR 128, Mr Justice Mason, 213 and 214 Mr Justice Brennan, and 254 and 281

Mr Justice Deane. In all of the statements of

discrimination there, the principle was simply that

the Commonwealth may not pass laws which

discriminate against the States or their agencies.

True it is when that principle came to be

applied in Melbourne Corporation v QEC, one was

dealing with a particular form of discrimination

whereby the States were singled out viz-a-viz

employers generally, but that just happened to be

the application of the principle, in our

submission.

In the QEC case at 217, Your Honour the

Chief Justice contemplated that there could be a singling out by one State being dealt with

differently to another State, and in that case as

well it was obviously contemplated that there could

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be an unlawful discrimination even though it was

confined to affecting the legislative or the
executive or the judicial powers of the State.

The ultimate rationale, in our submission, is

that the law-making power given to the federal application to the State or their agencies, a power

to discriminate.

GAUDRON J: But, Mr Solicitor, does it? You are talking

about section 121, are you not?

MR MASON: Yes.

GAUDRON J:  Does section 121 do anything other than put the

Commonwealth as employer in the same position as

State employers? Does it not provide that the

Commission may, in relation to Commonwealth

employees and Territory employees, make awards

inconsistent with Commonwealth laws or Territory

laws, which presumably would apply to those employees, because they would have no other
operation, putting the Commonwealth therefore in

the same position as State employees who will take
the benefit of an award over and above State

legislation.

MR MASON:  But "relevant law" is defined in subsection (2)

to mean, "A law other than", and then some stated

laws are spelt out, "or a prescribed enactment".

So the Commonwealth has reserved to itself through

the power to prescribe enactments the power to say

"Well, the award-making power does not apply if it

would conflict with any of the following

enactments". Your Honours, I have handed the Court

a bundle of the federal enactments relating to

employment conditions for Commonwealth public

servants. They cover virtually the entire gamut of

activities that could be covered by an award,

including salary. That is Division l0A of the

Public Service Act 1922. So by the stroke of the

pen, any one of these Acts could be prescribed and

the award-making power would yield to these Acts

and the powers conferred under them.

GAUDRON J: Have any been prescribed?

MR MASON: Regulation 14 prescribes, I think, only one.

There are a couple in relation to the Territories,

and one of general import, the Superannuation

Interim Benefits Act.	It is the power to prescribe
that we complain about.

GAUDRON J: Yes, is the consequence of your argument, if

accepted, that the regulation-making power is

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invalid to the extent that it applies to

section 121(2)?

MR MASON:  No, the consequence of this argument is that

section - - -

GAUDRON J: Perhaps the whole Act is invalid?

MR MASON:  No, no, section 6 of the Act which subjects the

State Crown, or subjects the Crown in all of its manifestations to the Act is, in its application to

the State, invalid because it purports to subject
the State to the whole Act and the whole Act has in

section 121 this discriminatory vice.

McHUGH J: But 121(1) enables the Commission to make an

order even though it is inconsistent with the

relevant law?

MR MASON: Unless it is prescribed, but once it is

prescribed the Commission cannot make an

inconsistent award.

McHUGH J: Where does that come from? I must have an

out-of-date copy of the Act.

MR MASON:	It may make an award for order that is not, in its opinion, consistent with a relevant law, and relevant law is defined to mean "any law other
than", and then one has certain named Acts and then
a general power to prescribe.  Now, those other
laws would operate presumably under expressio unius
principle, and if one goes, for example, to the
Public Service Act 1922, section 82D, which is in the bundle, in effect, the power to fix salaries in
the federal public service, is with a board.

DEANE J: There is a bit of a problem with that as to

timing, is there not, in that if the award is made,

which means as things are at present, and the

legislation is then prescribed, presumably the

award would still be valid?

MR MASON:  The award in its impact to the federal public service?

DEANE J: Yes. Well now, if that is so, there is a query

whether the relevant timing on your argument is

only after a particular law is prescribed. It may

be that the exceptions in (a) are sufficient to get

you there, if the argument be right.

MASON CJ:  The way that this present argument, if correct,

is conceptually different to the others, is that it

would appear to invalidate the whole exercise being

commenced by the Commission and one does not need

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,,

to be concerned about whether they are going too

far in their power - - -

DEANE J: Well, I think I have been obscure. Presume that

(a) was not there.

MR MASON:  We would say that the presence of (b) is enough

because if the Commonwealth were logged with the

same sort of log we have here, they would have the

power immediately to deprive the Commission of

jurisdiction by prescribing section 82D of the

Public Service Act -

DEANE J:  I follow that. The query of my question is

directed to, as if your argument be otherwise

correct, whether the objection is only valid after

the law has been prescribed, or whether the power

to create a regime which precludes, or which allows

discrimination and which the Commonwealth of

necessity will always have, itself suffices?

MR MASON:	I think it is just assertion but my submission is that it is the presence of the power that is the
vice, rather than its exercise, and it is the vice
that really relates back to section, 6 of the Act.

DEANE J: Because it vests the power to create a

discriminatory regime in the Commonwealth executive

as distinct from the Commonwealth Parliament.

MR MASON: Well, I would put it another way; it makes the

Act discriminatory on its face, just as the QEC Act was discriminatory on its face. It would have been

no answer to an award made under the regime that,

in fact, it took the ordinary time. It was the

capacity to fast-track it that led to the

legislation being struck down by this Court.	If
this argument is valid, in my submission, it

invalidates, we say, under appropriate principles,

section 6 in its application to the States.

DEANE J: If one does not accept your submission as to

timing, do you rest a separate argument on the

exemptions in (a)?

MR MASON:	Your Honours, certainly, yes, I do, yes.
GAUDRON J:	Even though they have no relevance to the log? There is no claim here for employee compensation
entitlements - workers' compensation entitlements.
MR MASON:	Yes, because the presence of the discrimination

on the face of the Act invalidates the Act. Now,

one does not, unless one has to, invalidate the

whole Act - - -

DEANE J: It invalidate section 6, does it not?

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3/6/92

MR MASON: 

And would invalidate section 6, and without

section 6 none of the disputes in either of the two
sets of proceedings can get off the ground.

GAUDRON J: 

I would be interested as to why it should be

section 6 rather than section 121 that is

invalidated?

MR MASON:	Because if one were, as it were - - -
GAUDRON J: Or the Act as a whole.	I mean, from my point of

view, assuming there is a discrimination, I do not

know whether the legislature would wish to preserve

its right if it had to chose between legislating

for the workers' compensation entitlements of its

employees, or giving the Commission power to

arbitrate with respect to industrial disputes

affecting the States.	How do I know which choice
it would make?

MR MASON: Well, maybe on the very principle of

discrimination which section 121 betrays, the

Commonwealth would rather keep its bit and let the

States go, than have the Act as a whole brought

down or to have its right under section 121 taken

out and leave the States.

GAUDRON J: Well why not, yes. There is a real severance

problem, is there not, on your argument?

MR MASON:	There is a real severance problem, and in opting for section 6 we have obviously endeavoured to
choose that which will cause the least disruption
and the most benefit to ourselves alone.

GAUDRON J: Would not one way in to the discrimination

aspect be discretionary power of the Commission,

and what used to be 4l(l)(d) of the Conciliation

and Arbitration Act, which I daresay not exists

under a different number, to preserve - - -

MR MASON: lll(l)(g), I think.
GAUDRON J: Yes.
MR MASON:	Is that the power to say it should stay in the State system?

GAUDRON J: Yes.

MR MASON: Well, we submit that a constitutional principle

cannot stand on an administrative discretion.

GAUDRON J:  On an arbitral discretion perhaps.

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MR MASON:	An arbitral discretion, yes.	I am sorry I have

gone over time, Your Honours.	I believe that is
all that I wish to say.

DEANE J:  We have taken you over time rather than you going

over time.

MASON CJ:  Or some of us have taken you over time.

MR MASON: If the Court pleases.

MASON CJ: Thank you, Mr Solicitor. The Court will adjourn

now.

AT 4.28 PM THE MATTER WAS ADJOURNED

UNTIL THURSDAY, 4 JUNE 1992

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