Roderick, D.J. v Australian Telecommunications Commission

Re: DAVID JAMES RODERICK
And: AUSTRALIAN TELECOMMUNICATIONS COMMISSION
No. S G21 of 1991
FED No. 398
Administrative Law - Telecommunications
(1991) 40 IR 217

COURT

IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIAN DISTRICT REGISTRY
GENERAL DIVISION
Von Doussa J.(1)

CATCHWORDS

Administrative Law - judicial review - notice of objection to competency - decision by respondent to terminate employment of the applicant - whether the decision was one to which the Administrative Decisions (Judicial Review) Act 1977 applied - whether the decision was one made under an instrument or under an implied power in the contract of employment - whether the decision was excluded from judicial review as being a decision under the Industrial Relations Act 1988 - whether decision made under an Award.

Telecommunications - Determinations made under the Telecommunications Act 1975 as amended by the Telecommunications Amendment Act 1988, and under the Australian Telecommunications Corporations Act 1989 - whether terms and conditions of employment applied by those determinations empowered termination of employment - whether the determinations were instruments within the meaning of the Administrative Decisions (Judicial Review) Act 1977 - whether the termination of the applicant's employment was made under the determinations.

Administrative Decisions (Judicial Review) Act 1977, s.3, Schedule 1

Telecommunications Act 1975, ss.40, 43, 55, 56

Telecommunications Amendment Act 1988, ss.14, 32

Telecommunications and Postal Services (Transitional Provisions and Consequential Amendments) Act 1989, ss.88, 90

Australian Telecommunications Corporations Act 1989, ss.85, 86

HEARING

ADELAIDE

#DATE 11:7:1991

Counsel for the applicant: Mr N.G. Buckworth

Solicitor for the applicant: Stanley and Partners

Counsel for the respondent: Dr G. Flick with Mr S. Walsh

Solicitor for the respondent: Ward and Partners

ORDER

The objection to competency in relation to the decisions made by Telecom alleged on 21 June 1990 and 2 November 1990, and in relation to the conduct of Telecom alleged from the month of May 1990 to February 1991 be upheld.

The objection to competency is otherwise dismissed.

Question of costs adjourned for further consideration.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

The respondent ("Telecom") objects to the competency of the application which seeks to review decisions made on 21 June 1990, 2 November 1990 and 21 February 1991, and conduct from the month of May 1990 until February 1991, of Telecom which had the effect of bringing the applicant's employment with Telecom to an end on 22 February 1991. The primary ground of objection to competency contends that the decisions sought to be reviewed are not decisions to which the Administrative Decisions (Judicial Review) Act 1977 ("the ADJR Act") applies. The objection to competency also asserts that the decisions alleged on 21 June 1990 and 2 November 1990 are not reviewable decisions; that the application is brought out of time in respect of those decisions; and that the impugned conduct was not "conduct for the purpose of making a decision to which this Act applies" within the meaning of s.6 of the ADJR act. Argument has proceeded on the footing that the resolution of the objection to competency turns on the primary ground of objection, and the additional grounds received little attention, although it will be necessary to refer briefly to them later in these reasons.

Sub-section 3(1) of the ADJR Act relevantly provides:

"'Decision to which this Act applies' means a decision of an administrative character made, proposed to be made, or required to be made, as the case may be (whether in the exercise of a discretion or not) under an enactment, other than a decision by the Governor-General or a decision included in any of the classes of decisions set out in Schedule I."

Schedule I of the ADJR Act is headed "CLASSES OF DECISIONS THAT ARE NOT DECISIONS TO WHICH THIS ACT APPLIES" and includes:

"(a) Decisions under the Conciliation and Arbitration Act 1904 or the Industrial Relations Act 1988".

The primary ground of objection to competency is based on alternative arguments. It is contended that the operative decision which brought about the termination of the applicant's employment, the decision made on 21 February 1991, was not "made...under an enactment" or, alternatively was a decision included in one of the "classes of decisions set out in Schedule I" being a decision made under the Industrial Relations Act 1988. If either argument succeeds the decision is not a "decision to which this Act applies" as defined in sub.s.3(1).
The following facts are not in dispute. On 28 August 1989 the applicant applied to the respondent for employment as a Radio Lineman. On 6 September 1989 he attended the interview. By letter dated 18 September 1989 the applicant was advised of his appointment which he was to take up on 25 September 1989. The letter indicated conditions of employment. In the material part it read:

"As previously discussed at your interview the 'Conditions of Employment' are as follows:

- 6 months probation, during which your ability to satisfy the job requirements will be assessed.

- a satisfactory Conduct, Diligence and Efficiency Report. - a satisfactory Commonwealth medical Officers report. - you must contribute to a Superannuation scheme upon commencement."

As a result of restructuring under an Award, the applicant's job title was changed on about 8 December 1989 to Communications Officer Grade II.
On or about 16 February 1990 the applicant received a document from Telecom bearing that date headed "Appointment Advice" which commenced:

"I am pleased to advise that you have been appointed as a permanent officer of the AUSTRALIAN TELECOMMUNICATIONS CORPORATION. All details relating to your Appointment are outlined below:

--------------------------------------------------------- APPOINTMENT DETAILS

APPOINTED AS: COMMUNICATIONS OFFICER GRADE 2 DATE OF PERMANENT APPOINTMENT 05/01/90

..."

The Appointment Advice contained no reference to the conditions of employment set out in the letter dated 18 September 1989. It did not assert that those conditions had been fulfilled. One of the issues in dispute between the parties on the merits is whether the Appointment Advice constitutes a binding and irrevocable acknowledgment by Telecom that the conditions of employment as to probation had been fulfilled. The applicant asserts that proposition. Telecom denies it, saying that the Appointment Advice was issued in relation to superannuation requirements. Telecom contends that it still remained for the applicant to fulfil those conditions.

On 21 June 1990 Telecom wrote to the applicant saying:

"Confirmation of permanent appointment is dependent upon a number of factors, and these are listed on the attached copy of the Human Resources Employment Policy, C2/2/2.

In particular, satisfactory Conduct, Diligence and Efficiency during the probation period is essential before confirmation can proceed.

I have been advised that you have not satisfied this criterion, despite being counselled regarding your performance, and in accordance with HRP C2/2/5, attached, I hereby advise you that your employment with Telecom will be terminated as from the close of business Thursday 28 June 1990. ..."

The letter went on to advise the applicant that he could have the decision reviewed, a matter which he apparently took up with Telecom. The Human Resources Employment Policy, C2/2/2 set out conditions which must be met during a probationary period before confirmation of employment. One condition required a satisfactory conduct, diligence and efficiency report. Policy C2/2/5 reads:

"An employee's engagement will be terminated at the completion of the initial probationary period, or the extended probationary period, where all of the above conditions have not been met."

Telecom allege, and the applicant denies, that his employment would have been validly terminated at the completion of the probationary period on the ground stated in the letter of 21 June 1990.

As the applicant sought a review of the decision conveyed in the letter of 21 June 1990, his employment continued pending the outcome of that review. On 12 September 1990 Telecom wrote to the applicant saying, in part,:

"I refer to my letter of 21 June 1990 in which you were advised that your appointment would be annulled and your service with Telecom would be terminated...

Due to the delay in finalising this matter, I have revoked my previous decision to annul your appointment and have requested a further report on your conduct, diligence and efficiency. The annulment is therefore still being considered and a decision will be made in the light of all the reports I have received and any comments or submissions you wish to make. ..."

The applicant was advised of the outcome of the further consideration by Telecom by letter dated 2 November 1990. The letter said that the applicant had not met the criteria for confirmation of appointment with regard to satisfactory conduct, diligence and efficiency, and concluded:

"I have therefore decided to annul your appointment and terminate your employment with effect from the close of business on 19 November 1990.

If you wish to have this decision reviewed, you may apply in writing, within fourteen days of receipt of this advice, to the Chairman, Review Tribunal, care of the Promotions Appeal Board, ..."

The applicant sought to have the decision reviewed. A review was conducted by "the Review Tribunal" which reported the outcome in a letter to Telecom dated 21 February 1991. The formal decision of the Review Tribunal, unanimously reached, is expressed as follows:

"The decision of Telecom Australia (South Australian Administration) to annul the appointment of Mr Roderick under the existing guidelines of the Telecommunications Act is correct, and the matter should proceed to finality."

Telecom forwarded a copy of this decision to the applicant by letter dated 21 February 1991 which read:

"I have attached a copy of the decision of the Review Tribunal confirming Telecom's decision to annul your appointment and terminate your service with Telecom.

Your employment with Telecom ceases at 4.10pm on 22 February 1991. ..."

The application for an order of review under the ADJR Act was filed in this Court on 19 March 1991. It challenges not the decision of the Review Tribunal made on 21 February 1991, but the decision of Telecom to implement that decision.
The primary ground of objection to competency turns on the effect of amendments to the Telecommunications Act 1975 ("the 1975 Act") which came into operation in 1989. Spender J. described those amendments as labyrinthine in Hudson v Australian Telecommunications Corporation and Anor (judgment of Spender J., 22 November 1990).
Prior to the amendments, Part V of the 1975 Act dealt extensively with the staff of the Australian Telecommunications Commission. In particular, Division 2 provided for the establishment of the Australian Telecommunications Commission Service (s.38); Division 3 dealt with officers and employees, including their appointment and terms and conditions of employment (ss.39-43); Division 4 dealt with classifications, appointments and promotions (ss.44-53); Division 5 dealt with tenure of office (ss.54-56); Division 6 dealt with dismissals and punishments (ss.57-64); and Division 7 dealt with forfeiture of office (s.65). The following provisions are directly material to this appeal:

"39.(1) The Commission may appoint as officers such number of persons as it thinks necessary for the purposes of this Act. ...

40.(1) Unless the Commission, in a particular case, otherwise directs, the appointment of every officer shall be on probation for a period of 6 months commencing on the day on which the officer commences duties in pursuance of his appointment.

(2) A person appointed as an officer on probation remains a probationer until his appointment is confirmed or terminated in accordance with this section.

(3) The Commission may, at any time during the period of 6 months, terminate the appointment.

(4) As soon as practicable after the expiration of the period of 6 months, the Commission shall -

(a) confirm the appointment;

(b) terminate the appointment; or

(c) direct that the probationer continue on probation for such further period (not being a period exceeding 6 months) as the Commission determines.

(5) Where the Commission directs that a probationer continue on probation for a further period, the Commission may confirm or terminate the appointment of the probationer at any time during that further period and, if it does not confirm or terminate the appointment before the expiration of that period, shall do so as soon as practicable after the expiration of that period.

(6) Where the appointment of a probationer is to be terminated, the Commission shall notify the probationer in writing of the reasons for the termination of the probation.

(7) The regulations shall make provision for and in relation to the review of a decision of the Commission under paragraph (4)(b). ...

43.(1) Subject to this Part, officers and employees hold office on such respective terms and conditions as the Commission determines.

(2) ...

...

56.(1) If an officer appears to the Commission to be inefficient or incompetent, or unable to discharge or incapable of discharging the duties of his position, the Commission may -

(a) transfer him to another position having the same classification as the position held (whether in the same or a different locality);

(b) reduce him to a lower position and salary; or

(c) retire him from the Service.

(2) The regulations shall make provision for and in relation to the review of a decision of the Commission under this section upon application by an officer affected by it."

For the purposes of reviews of decisions by the Commission under, inter alia, para 40(4)(b) and sub.s.56(1) the Telecommunications Regulations, Part V, established Review Tribunals.
By the Telecommunications Amendment Act 1988 (No. 121 of 1988) the Australian Telecommunications Commission became the Australian Telecommunications Corporation. Section 14 of that Act repealed Divisions 2-7 inclusive of Part V of the 1975 Act and substituted ss.38 and 39. By s.32 of Act No. 121 of 1988 the distinction between officers and employees which had hitherto existed was abolished. Sections 38 and 39 as amended read:

"38. (1) The Corporation may engage such employees as are necessary for the performance of its functions and the exercise of its powers.

(2) The terms and conditions of employment shall be determined by the Corporation.

39. The Corporation shall endeavour to achieve and maintain high standards as an employer in relation to terms and conditions of employment, occupational health, industrial safety, industrial democracy, non-discriminatory employment practices and other matters."

The amendments for changing the Commission into a Corporation came into operation on 1 January 1989. The amendments concerning staffing, including s.14 of Act No. 121 of 1988 came into operation on 30 June 1989.
The effect of the amendments was to take terms and conditions of employment out of the 1975 Act and to provide for them in a determination made under s.38. A determination was made under that section on 29 June 1989 by the Managing Director of Telecom which had effect from 30 June 1989 after the proclamation which brought s.14 of Act No. 121 of 1988 into operation. In material respects the determination ("the s.38 Determination") reads:

"COMMONWEALTH OF AUSTRALIA

TELECOMMUNICATIONS ACT 1975 SECTION 38 DETERMINATION

Whereas:

(a) Section 14 of the Telecommunications Amendment Act 1988 is, under subsection 2(3) of that Act, to commence on a day to be fixed by Proclamation for the purposes of that subsection;

(b) Section 14 of that Act will, when proclaimed, insert a new section 38 in the Telecommunications Act 1975;

(c) Under section 4 of the Acts Interpretation Act 1901, the power of the Corporation to determine terms and conditions of employment pursuant to section 38 may be exercised before the proclamation date; and

(d) Under section 29 of the Telecommunications Act 1975, all acts and things done in the name of the Corporation by the Managing Director shall be taken to have been done by the Corporation:

The Australian Telecommunications Corporation hereby determines under section 38 of the Telecommunications Act 1975:

1. ...

2. The terms and conditions of employment applicable from the proclamation date to staff employed after that date and staff continued in employment under section 32 of the Telecommunications Amendment Act 1988 shall be:

(a) ...

(b) ...

(c) ...

(d) in respect of other staff - the terms and conditions applicable to an officer immediately before the proclamation date.

3. A reference in paragraph 2 to the terms and conditions in force immediately before the proclamation date is a reference to terms and conditions applicable under:

(a) the Telecommunications Act 1975, and the Telecommunications Regulations, as in force immediately before the proclamation date;

(b) the Telecommunications (Staff) By-laws and the Telecommunications Staff (Salaries) By-laws;

(c) any determination, made under section 43 of the Telecommunications Act 1975 as so in force, which was in force immediately before the proclamation date; and

(d) any conditions relating to the calculation of, or payments for, terms and conditions which were contained in the Personnel and Industrial Relations Departments Guidelines and Procedures, or in Accounting Instructions, in force immediately before the proclamation date.

4. The terms and conditions made applicable by paragraph 2 do not include:

(a) to the extent that substitute disciplinary procedures have been prescribed by or under an Award of the Industrial Relations Commission - the disciplinary procedures in Division 6 of Part V of the Telecommunications Act 1975 and the Telecommunications Regulations made under that Act; or

(b) to the extent that substitute complaint procedures have been agreed between a relevant organization and the Corporation - the provisions in By-law 15 of the Telecommunications

(Staff) By-laws.

5. Section 40 of the Telecommunications Act 1975 as in force immediately before the proclamation date shall apply, pursuant to this determination, as if:

(a) references in it to an 'officer' were references to an employee engaged otherwise than as a casual or fixed-term employee; and

(b) references in subsection 40(7) to review of decisions were references to review by a review tribunal established in accordance with paragraph 7 of this determination.

6. Sections 55 and 56 of the Telecommunications Act 1975 as in force immediately before the proclamation date shall apply, pursuant to this determination, as if the following provision were substituted for them:

'(1) If an employee:

(a) appears to the Corporation to be inefficient or incompetent, or unable to discharge or incapable of discharging the duties of the employee's work assignment; or

(b) is found by the Corporation to be excess to the requirements of the Corporation, the Corporation may:

(c) transfer the employee to another work assignment, at the same or another locality, having the same classification level as the work assignment from which the employee is transferred;

(d) transfer the employee to another work assignment, at the same or another locality, having a lower classification level than the work assignment from which the employee is transferred; or

(e) retire the employee.

(2) An employee affected by a decision made under subsection (1) shall have a right to have the decision reviewed by a Review Board.'

Review Boards

(3) There shall be established, as required, Review Boards, whose function will be to review decisions of the Corporation and recommend appropriate action. A review Board shall be constituted of:-

(a) a Chairperson being a person who performs the function of a Chairperson Promotion Appeal Board;

(b) an employee nominated by the Corporation for the purpose of the appeal; and

(c) an employee nominated by the appropriate staff organisation prescribed under Clause 36 of the General Conditions of Employment Award. Conduct of Reviews

(4) A Review Board shall exercise its power having regard to the principles of natural justice.

7. Where a reference in a term or condition detailed in paragraph 3 relates to proceedings instituted or to be instituted before a Promotions Appeal Board, Disciplinary Appeal Board or Review Tribunal established under the Telecommunications Act or the Telecommunications Regulations, the reference shall be read as a reference to a board or tribunal, however named, established under a determination made by the Corporation under section 38.

8. ..."

That is not the end of the legislative amendments. On 1 July 1989, the day after the s.38 Determination came into effect, the Australian Telecommunications Corporation Act 1989 ("the 1989 Act") was brought into operation by proclamation. The 1975 Act and the Telecommunications Amendment Act 1988 were repealed by s.90 of the Telecommunications and Postal Services (Transitional Provisions and Consequential Amendments) Act 1989 which also came into operation on 1 July 1989.
The 1989 Act, by s.12, continues Telecom in existence. Sections 85 and 86 provide:

"85.(1) Telecom may engage such employees as are necessary for the performance of its functions.

(2) The terms and conditions of employment shall be determined by Telecom.

86. Telecom shall endeavour to achieve and maintain high standards as an employer in relation to terms and conditions of employment, occupational health, industrial safety, industrial democracy, non-discriminatory employment practices and other matters."

On 30 June 1989 the Managing Director of Telecom made a determination under s.85 of the Australian Telecommunications Corporation Act (the S.85 Determination) which, in material parts reads:

"COMMONWEALTH OF AUSTRALIA

AUSTRALIAN TELECOMMUNICATIONS CORPORATION ACT 1989 SECTION 85 DETERMINATION

Whereas:

(a) Section 85 of the Australian Telecommunications Corporation Act 1989 ('the Act') is, under section 2 of the Act, to commence on a day to be fixed by proclamation.

(b) Under section 4 of the Acts Interpretation Act 1901, the power of the Corporation to determine terms and conditions of employment pursuant to section 85 may be exercised before the proclamation referred to in (a);

(c) On 29th June 1989 a determination was made by the Australian Telecommunications Corporation under section 38 of the Telecommunications Act 1975 as in force following the proclamation made under subsection 2(3) of the Telecommunications Amendment Act 1988 ('the first determination'); and

(c) Under section 24 of the Act all acts and things done in the name of the Corporation by the Managing Director shall be taken to have been done by the Corporation: The Australian Telecommunications Corporation hereby determines under section 85 of the Act:

1. ...

2. The terms and conditions of employment applicable from the date on which the Act is proclaimed to commence to staff employed after that date and staff continued in employment under section 88 of the Telecommunications and Postal Services (Transitional Provisions and Consequential Amendments) Act 1989 shall be the terms and conditions determined under the first determination.

3. In the application of the first determination under this determination, a reference in the first determination to a board or tribunal established under a determination made by the Corporation under section 38 shall be read as a reference to a board or tribunal established under a determination made by the Corporation under section 38 or under section 85 of the Act.

4. ..."

The appointment of the applicant, subject to the probationary conditions, was made after the 1989 Act and the s.85 Determination came into effect. The "Review Tribunal" which reviewed Telecom's decision "to annul (the applicant's) appointment and terminate (his) service" was a Review Board established under a determination made by Telecom. It is not entirely clear that the "Review Tribunal" was not established under a separate determination to which no reference is made in the above discussion, although the inference from the material before the Court is that the establishment occurred by force of clauses 6(3) and 7 of the s.38 Determination and clause 3 of the s.85 Determination. Nothing turns on this for present purposes.
For the consideration of the alternative limb of Telecom's primary ground of objection to competency it is also necessary to record that the Industrial Relations Act 1988 came into operation on 1 March 1989. The Telecom General Conditions of Employment Award 1989 ("the TGCE Award") was made by consent by the Industrial Relations Commission on 4 September 1989 with effect from 14 July 1989. It will be necessary later to refer to clauses in that Award.
Counsel for Telecom addressed argument on the primary ground of objection to the decision made on 21 February 1991. Counsel did so on the footing that that was the operative decision: Australian Broadcasting Tribunal v Bond (1990) 170 CLR 321. However the arguments would also apply to the decisions alleged on 21 June 1990 and 2 November 1990. Furthermore if the decisions under challenge are not reviewable decisions it would follow that the alleged conduct which it is sought to review under s.6 of the ADJR Act was not conduct for the purpose of making a decision to which the ADJR Act applies. If the primary ground of objection is made out the application is defeated in its entirety.
The first contention of Telecom is as follows. Telecom entered into a contract of employment with the applicant. The later termination of the applicant's employment was effected under an implied power in that contract to dismiss an unsatisfactory employee. The decision in exercise of the implied power was not a decision made under an enactment, but one made under the contract of employment: cf Australian National University v Burns (1982) 43 ALR 25.
On this approach it is immaterial whether the applicant's appointment was still probationary when the decision was made.
It is conceded that if the appointment of the applicant, and the termination of his employment, had occurred whilst the 1975 Act was in force, the decision to terminate would have been reviewable under the ADJR Act. If the applicant were still on probation, the decision would have been one made under a power in s.40. If the period of probation had come to an end by the confirmation of his appointment, the power to terminate his employment for unsatisfactory performance would have arisen under s.56 of the 1975 Act (retirement on the ground of inefficiency or incompetence).
The effect of the legislative changes which culminated in the 1989 Act, it is submitted, was to abolish these sources of power to terminate the employment of an employee. It is conceded that the s.85 Determination, which incorporates the s.38 Determination, is "an enactment" within the meaning of the ADJR Act: see Chittick v Ackland (1984) 1 FCR 254 at pp 262-264. However whilst the effect of the Determinations is to carry forward "terms and conditions of employment" which applied immediately before the legislative amendments, it is submitted that, as a matter of construction, the Determinations do not carry forward from the old regime powers in Telecom to terminate contracts of employment on the grounds formerly existing, and in particular those under ss.40 and 56.
The central issue raised by these submissions is to identify the source of power under which Telecom made its decision to terminate the applicant's employment. Whereas Telecom contends that the source of power is an implied contractual term, the applicant contends that the power arose under the s.85 Determination.
It is contended that the expression "terms and conditions of employment" in the Determinations has a narrow meaning which does not include the power to terminate a contract of employment. This meaning is said to have its genesis in the 1975 Act. Section 43 of that Act provided that "officers and employees hold office on such respective terms and conditions as the Commission determines". In the context of the 1975 Act it is contended that the expression "terms and conditions" in s.43 did not include powers to terminate an appointment of an officer. These powers resided in other sections within Part V, including, in particular ss.40 and 56. It is submitted that a clear distinction is drawn between powers to terminate on the one hand and terms and conditions of employment on the other hand, a distinction which the language of ss.40 and 43 of the 1975 Act emphasises.
I am unable to accept this argument. The expression "terms and conditions of employment" is one frequently used in matters concerning industrial relations. In normal use the expression does not carry a technical meaning. It is a wide expression which includes not only contractual terms and conditions but all "those terms which are understood and applied by the parties in practice or habitually, or by common consent, without ever being incorporated into the contract": British Broadcasting Corporation v Hearn and Ors (1977) 1 WLR 1004 per Lord Denning at 1010; see also Roskill L.J. at 1015. In my view "terms and conditions of employment" in the two Determinations should receive a similar, wide, interpretation. The Determinations recognise that many of the terms under which people who were formerly officers under the 1975 Act were employed were not consensual terms and conditions, but were terms imposed by statute, by regulation, or unilaterally by determination under sub.s.43(1). The obvious intent of the s.38 Determination and the s.85 Determination is to transpose to the new regime, with a minimum of technicality and verbage, all the terms and conditions of every kind which had previously governed the employment relationship.
In s.43 of the 1975 Act "terms and conditions" refers not only to terms and conditions other than termination in the case of officers, but to all terms and conditions including those which provide for termination in the case of employees who did not have the benefit of the tenure of office accorded to officers under the provisions of Part V. In my view, there is every reason to think that "terms and conditions" was an expression intended to have a wide, comprehensive meaning in s.43.
Moreover, in the s.38 Determination I consider it is clear that the expression "terms and conditions" in force immediately before the proclamation date is not restricted in the manner which Telecom contends. By para 3(a) the words include terms and conditions applicable under the 1975 Act and regulations. As terms and conditions arising under determinations made under s.43 of the 1975 Act are separately included in para 3(c) there is no reason why "terms and conditions" under the 1975 Act should not include provisions as to termination such as those contained in ss.40, and 56, and those relating to termination in the event of established misconduct contained in Division 6 of Part V. The terms of para 4 also confirm that the terms and conditions made applicable by para 2 are not limited to those which arose under determinations made under s.43 of the 1975 Act. Paragraphs 5 and 6 of the s.38 Determination are of particular importance. As I read these paragraphs they do not limit the meaning of "terms and conditions". Express reference to ss.40, 55 and 56 of the 1975 Act is made, not because the subject matter of the sections is otherwise outside the scope of paras. 2 and 3, but because the terms and conditions created by those sections were expressed to apply to "officers". The package of amendments in 1988-1989 abolished the classification of "officer", and the sections had to be recast to enable the terms and conditions created by them to be made applicable to "employees". The wording of para 6 is, to say the least, strange, but the intent is clear enough.
Paragraph 5 of the s.38 Determination expressly applies s.40 of the 1975 Act, subject to the alterations stated, as "terms and conditions of employment" under sub.s.38(2) of the 1975 Act as amended by Act No. 121 of 1988. In turn, by force of the s.85 Determination, s.40 of the 1975 Act, as altered by the s.38 Determination, is applied as part of the "terms and conditions of employment" under sub.s.85(2) of the 1989 Act.
The broad contention that Telecom terminated the applicant's employment under an implied contractual power to dismiss an unsatisfactory employee conveniently developed the primary ground of objection to competency in a way which covered both versions of the disputed facts, but does not sit comfortably with the correspondence which has been accepted by the parties as common ground for the purposes of argument. The correspondence leaves little doubt that when Telecom decided to terminate the employment of the applicant it purported to act under the applied provisions of s.40 of the 1975 Act. The applicant was appointed on probation. Telecom purported to exercise a power to terminate his employment at the completion of the probationary period (see the letter of 21 June 1990 and its reference to HRP C2/2/5), a power similar to that arising under sub.s.40(4). Then, on the decision being made on 2 November 1990 to "annul your appointment and terminate your employment", the applicant was informed that he could have the decision reviewed. It is reasonable to assume that he was so advised because Telecom considered he had that right under the terms and conditions of his employment. Such a right could arise under the applied provisions of sub.s.40(7). The material before the court discloses no other source of such a right. In my opinion the right does not arise under the terms of the TGCE Award (a matter which is discussed below), and it is not a right which the law or the circumstances of the case would imply into the contract of employment. In short, the most likely interpretation of the material before the court is that Telecom made the decision to terminate the applicant's employment in purported exercise of a term or condition of employment imposed by the application of s.40 under the s.85 Determination. The source of power for the decision, and the source of the legal effect of the decision, was that Determination. As such it was a decision made under an instrument, and therefore a decision made under "an enactment" as defined in the ADJR Act: Hudson v Australian Telecommunications Corporation and Anor at p 20. The implimentation of that decision, after the review, flowed from the applied provisions of s.40 of the 1975 Act, not from an implied contractual term.
In the material before the court the contention that Telecom made the decision to terminate the applicant's employment under an implied term in the contract of employment finds no support. Nowhere in the correspondence between the parties is that suggestion made. On the contrary, the power referred to is one to terminate an appointment which has not been confirmed as permanent on the ground that the employee has not fulfilled a condition of the probation. Reference is made in the correspondence to the Human Resources Employment Policy. The nature and status of this document is not disclosed. The limited information available suggests that the document contains guidelines for compliance with terms and conditions of employment that are otherwise created, presumably under a determination made under s.85 of the 1989 Act. As the only such determination placed before the court is the s.85 Determination, that remains the probable source of power. As I have already observed, Telecom's advice to the applicant in its letter of 2 November 1990 that he could have the decision reviewed is against the contention that the decision was made under an implied term in the contract of employment.
Counsel for Telecom relied heavily on Australian National University v Burns. The University was established by the Australian National University Act 1946. Section 23 empowered the Council to appoint officers. It was held that this power, in conjunction with the power of "entire control and management" given to the Council by the Act included the power to dismiss officers. However the dismissal of Professor Burns by the Council was held to be a decision made under his contract of engagement and not under the powers conferred by s.23. Bowen C.J. and Lockhart J. at p 32 said:

"Notwithstanding that s 23 was the source of the Council's power to appoint and dismiss the respondent in 1966, it does not follow that the decision to dismiss him was made under the University Act. The answer to the question lies in the true characterization of the decision itself. It was not a decision to dismiss the respondent simpliciter. It was a decision to dismiss him on a particular ground namely, that he had become permanently incapacitated from performing the duties of his office. This was one of the grounds expressly provided for in condition 2(b)(ii) of the conditions of appointment which formed part of the respondent's contract of engagement. The University Act prescribes no essential procedural requirements to be observed before a professor is dismissed and lays down no incidents of a professor's employment.

In our opinion the rights and duties of the parties to the contract of engagement were derived under the contract and not under the University Act. Section 23 empowered the Council to enter into the contract on behalf of the appellant. Even if the Council, in considering the position of the appellant under the contract, might be said to be acting under s 23, the effective decision for dismissal taken and notified to the respondent was directly under the contract."

Later their Honours said, at p 36:

"...to decide in the present case that the Council's decision to dismiss the respondent was made 'under' the University Act rests on too frail a branch - s.23. Parliament, if it wished, could have laid down essential procedural requirements to be observed before professors are removed from office or prescribed incidents of the employment of professors or otherwise specified particular rights or privileges to be enjoyed by them. But Parliament did not do this. Nor has the Council made any statutes touching these matters."

In the present case Telecom made the decision to engage the applicant in exercise of its power under s.85 of the 1989 Act. That power, in conjunction with the general powers of Telecom (see ss.17 and 19 of the 1989 Act), and construed in accordance with sub.s.33(4) of the Acts Interpretation Act 1901, must include a power to terminate the engagement. But it does not follow that the decision to terminate the applicant's employment was made under the 1989 Act. The applicant's appointment was confirmed by letter which recorded the terms of his probationary appointment, and, as in Australian National University v Burns, the view could be taken, if the letter stood alone, that the effective decision was made directly under the contract of employment. However the letter does not stand alone. Regard must also be had to the s.85 Determination which prescribes terms and conditions of employment which in my view cover the events which happened, and to the correspondence between the parties which indicates a likelihood that it was under those terms and conditions that the decision was made.
On the factual footing asserted by Telecom that the applicant's appointment remained a probationary one, in my opinion Telecom has not made out the first limb of its primary ground of objection to competency.
The submissions of counsel for Telecom were not confined to the factual assertion that the applicant's appointment remained probationary, but extended to cover the applicant's contention that his appointment had been confirmed. The applied provisions of s.40 could have no application in that case. Again the advice to the applicant that the decision could be reviewed by the Review Tribunal is against the contention that the decision was made under an implied contractual power. Rather, it points to the source of power as being a term and condition of employment which included a right of review. Paragraph 6 of the s.38 Determination would, according to its terms, cover the situation and provide both the source of power to terminate employment, and a right of review of a decision to do so.
A similar power hitherto existed under s.56 of the 1975 Act, and the regulations, as required by sub.s.56(2), made provision for a right of review to a Review Tribunal. The altered terms of s.56 applied by para 6 of the s.38 Determination substitute the title "Review Board" for the reviewing body. But in light of the terms of paras 3, 6, and 7 in particular, of the s.38 Determination I consider nothing turns on this change of name.
The source of power for the decision and its legal effect would again be the s.85 Determination, and the decision would be one made under that instrument. Even on the facts as asserted by the applicant, the materials before the court do not support the first limb of the primary ground of objection to competency.
The second limb of the Tribunal's primary ground contends that if the decision to terminate the applicant's contract of employment was one made under an enactment within the meaning of the ADJR Act the relevant enactment was not the s.85 Determination but the TGCE Award, and is therefore a decision excluded from review by Schedule 1 of the ADJR Act: Hudson v Australian Telecommunications Commission and Anor.
The TGCE Award was made by consent as part of the complex transition from the relationship which existed between the Commission and officers of the Australian Telecommunications Commission Service under the 1975 Act to the relationship between the Corporation and employees under the 1989 Act. Clauses 41 and 42 of the TGCE Award indicate that the Award is an interim measure not intended to encompass all the terms and conditions of employment of members of the organisations which are parties to it. The Award is not intended to constitute a complete code of the terms and conditions of employment. Insofar as the Award imposes terms and conditions, it governs the subject matter to which it relates. In Hudson v Australian Telecommunications Corporation and Anor Spender J. held that a decision by Telecom to dismiss an employee for misconduct was a decision made under the TGCE Award, and therefore one made "under...the Industrial Relations Act 1988", a class of decision that is not a decision to which the ADJR Act applies.
The question in the present case is whether the TGCE Award contains terms which provide a source of power for termination of a contract of employment on the ground of unsatisfactory performance. The Award provides, among many other clauses:

"5 - INCONSISTENCY WITH ACT AND DETERMINATIONS

(1) This award shall be read in conjunction with the Australian Telecommunications Corporation Act 1989 as amended from time to time and determinations.

(2) Where the said Act and determinations are inconsistent with the provisions of this award the latter shall prevail. ...

8 - STAFF

The Corporation may appoint a person as an employee, or transfer or advance/promote an employee within the Corporation provided that such appointment,, transfer or advancement/promotion is made in accordance with the provisions of this award.

(1) All employment will be as an employee;

(2) ...

(3) ...

(4) an employee may continue in the employment of the Corporation until attaining the age of 65 years but is entitled to retire from employment on or after attaining the age of 55 years; and

(5) an employee's employment with the Corporation shall normally cease when the employee attains the age of 65 years. 9 - ADVANCEMENT/PROMOTION APPEALS

Selection criteria

(1) Selection for advancement/promotion or temporary performance shall be on the ground of relative efficiency or equal efficiency and seniority.

(The balance of the clause provides for a right of appeal against a provisional promotion or a direction for temporary performance of duties, and for the establishment of promotions appeal boards).

10 - EMPLOYEE CONDUCT AND DISCIPLINE

(1) Behaviour by an employee shall be regarded as constituting misconduct if the employee:

(a) Wilfully disobeys or wilfully disregards a direction given them as an employee and given by a person having authority to give the direction;

(b) is inefficient or incompetent by reason of causes within their own control;

(c) ...

(d) ...

(e) ...

(f) ...

(g) ...

(2) Where the corporation initiates disciplinary action against an employee in connection with alleged misconduct, the matter shall be handled in accordance with procedures agreed between the parties which are set out in the exhibit 'Procedures agreed between the Australian Telecommunications Corporation and the staff organisations respondent to the Telecom General Conditions of Employment Award 1989' and which was tendered in the proceedings which lead to the making of this award. An employee upon whom the corporation has imposed disciplinary action shall have the right to appeal to a disciplinary appeal board against such disciplinary action in accordance with the above procedures agreed between the parties.

(3) ...

...

41 - CONSULT AND NEGOTIATE

Telecom and relevant staff organisations will consult and negotiate before making any changes to conditions of service prescribed within the Telecommunications Act 1975, Regulations and By-laws, which were in force on 28 June 1989. 42 - SAVINGS CLAUSE

Nothing in this award shall in itself operate to reduce the conditions of employment of an employee which were in existence immediately prior to or at the commencement of this award."

The decision by Telecom considered in Hudson v Australian Telecommunications Corporation and Anor was made under clause 10. In the present case no disciplinary proceedings were instituted by Telecom against the applicant, and Telecom does not seek to rely on clause 10. It is contended however that the power under clause 8 to appoint a person as an employee carries with it by implication a power to terminate the appointment, and that the applicant's employment was terminated under that implied power. In some circumstances an express power of appointment may imply a power to terminate the appointment, particularly where a power to terminate would not otherwise exist. This is likely to be the case with a statutory power contained in an Act which creates a legal entity which would otherwise be powerless to act. The Award however does not create Telecom. It assumes each of the parties to the Award has full legal capacity to contract.
Nor does the Award speak in a vacuum. It operates as part of the wider transitional scheme, and is subject to the express provisions of clauses 41 and 42. In particular clause 42 provides that the Award shall not in itself operate to reduce the conditions of employment which were in existence immediately prior to or at the commencement of the Award. Those conditions included the terms and conditions of employment applied by the s.85 Determination, and in turn by the s.38 Determination. The terms and conditions applied by the s.38 Determination in my opinion include all those provisions which applied to an officer under the 1975 Act and regulations including the provisions of ss.40 and 56 (as altered by paras 5 and 6). The 1975 Act and regulations provided comprehensive terms and conditions of employment covering the circumstances where a contract of employment could be terminated, and established rights for review of decisions adverse to an officer. Against this background I consider it would be contrary to the intention expressed in clauses 41 and 42 to imply into clause 8 a general power to terminate employment, as such a power would permit the terms and conditions of employment applied by the s.85 Determination to be side-stepped.
Clauses 9 and 10 make provision for an employee to have an adverse decision reviewed by an appeal board. These clauses do not cover the circumstances of the applicant's dismissal, and are not the source of the right of review by a "Review Tribunal" which the applicant exercised.
For these reasons I also reject the second limb of Telecom's primary ground of objection to competency. I hold that the decision to terminate the applicant's employment made on 21 February 1991 was a decision to which the ADJR Act applies.
The other grounds of objection to competency relate to the decisions alleged on 21 June 1990 and 2 November 1990 and the alleged conduct of Telecom from the month of May 1990 to February 1991. On the face of the application, it is brought well out of time in respect of these two decisions, and there is no application to extend time. Furthermore neither of these decisions, nor the conduct alleged, would seem to be operative causes of the aggrievement to the applicant. These shortcomings were pointed out by counsel for Telecom, and no argument to the contrary was advanced by counsel for the applicant. Even though the events surrounding these decisions, and the conduct of Telecom, constitute part of the background history that is likely to be agitated on the review of the decision made on 21 February 1991, I consider the objection to competency should be upheld in relation to the decisions alleged on 21 June 1990 and 2 November 1990, and to the alleged conduct.
Finally I refer to an observation made by counsel for Telecom in the course of argument that if the decision made on 21 February 1991 were held to be a decision to which the ADJR Act applies, that would be an odd situation having regard to the decision in Hudson v Australian Telecommunications Corporation and Anor - the two decisions would not sit comfortably together. I note that Spender J. was minded at the end of his judgment to note that the conclusion which he had reached "sits a little awkwardly" with an assurance of the Minister for Transport and Communications given in the second reading speech of the Telecommunications Amendment Act 1988. Be that as it may, the circumstances of the two cases are very different, and are readily distinguishable.
The objection to competency in relation to the decisions made by Telecom alleged on 21 June 1990 and 2 November 1990, and in relation to the conduct of Telecom alleged from the month of May 1990 to February 1991 is upheld, otherwise the objection to competency is dismissed. I will hear the parties on costs.

[1991] FCA 398

11 JULY 1991