Tasmanian Railway Pty Ltd T/A TasRail

[2015] FWCA 319

[2015] FWCA 319

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.217—Enterprise agreement

Tasmanian Railway Pty Ltd T/A TasRail
(AG2014/10083)

TASMANIAN RAILWAY PTY LIMITED GENERAL ENTERPRISE AGREEMENT 2013

Tasmania
COMMISSIONER LEE	MELBOURNE, 14 JANUARY 2015

Application for variation of the Tasmanian Railway Pty Limited General Enterprise Agreement 2013.

[1] This is an application to vary the Tasmanian Railway Pty Limited General Enterprise Agreement 2013 (the Agreement) pursuant to section 217 of the Fair Work Act2009 (the Act). The application has been made by the Tasmanian Railway Pty Ltd T/A TasRail.

[2] The Agreement was approved by me on 1 May 2014. The Agreement covers two employee organisations, the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) and the Australian Rail, Tram and Bus Industry Union (ARTBIU).

[3] On 3 December 2014, my chambers wrote to both the CEPU and the ARTBIU asking that they indicate whether they sought to make submissions or be heard in the matter. The CEPU advised on 8 December 2014 that they agreed with the variation and did not seek to be heard. The ARTBIU did not respond.

[4] The Applicant asks that the Fair Work Commission (the Commission) order that the Agreement be varied by;

“(a) Removing the table headed “Rates as at 12 November 2014” in Section C page 81 of the Agreement; and [by]

(b) Inserting the table in the variation attached to this application and marked “A” in Section C page 81 of the Agreement...”

[5] The Applicant also asks that the variation ordered operate from 12 November 2014.

[6] The grounds for this application are set out in the Form F1 which was provided by the Applicant in this matter. Those grounds are as follows:

“1. The Agreement was approved by Commissioner Lee pursuant to an order dated 1 May 2014.

2. Clause 19.1 of the Agreement provides that:

Wage Rates that apply during the life of the Agreement are detailed in the Aggregate Salary Tables included in the Remuneration clauses contained in Section A, B and C of this Agreement. These rates are based upon a 2.5% increase in Year 1, and a 3% increase in Year 2.

3. In Section C of the Agreement there is a table of remuneration rates headed “Rates as at Operational Date of Agreement” page 80 of the Agreement (Table 1). This is followed by a table of remuneration rates headed “Rates as at 12 November 2014” page 81 of the Agreement (Table 2).

4. In accordance with Clause 19.1 of the Agreement, the rates in Table 2 should reflect a 3% increase to the Base Salary compared to the rates in Table 1. The rates in Section A and B reflect a 3% increase for Year 2 (i.e. 12 November 2014).

5. However, due to an administrative error, the rates in Table 2 provide an increase of approximately 5.5%.

6. The result is that Clause 19.1 of the Agreement conflicts with the rates set out in Table 2. Therefore there is uncertainty as to whether or not the rates of pay should be increased as set out in Clause 19.1 or rates of pay should be as set out in Table 2.

7. The Applicant submits that the intention of the parties is clearly for the 3% increase to apply from 12 November 2014 as per clause 19.1. This was the basis for the negotiations and was communicated to the employees during the bargaining process.

8. The Applicant seeks an order varying the Agreement to substitute Table 2 with the table in the attached variation marked “A”. The variation will provide certainty as to the rates of pay applicable and reflects the intention of the parties to the Agreement at the time of negotiating and seeking approval of the Agreement.

9. The Commission has dealt with a similar application in Uniting Church in Australia Synod of Victoria and Tasmania, Commission for Mission, Uniting Church Camping Unit [2014] FWCA 4862 (Uniting Church).

10. In Uniting Church, Commissioner Roe found that an uncertainty arose as to whether or not rates of pay should increase pursuant to an incremental increase or in accordance with a table of remuneration where:

(a) The enterprise agreement provided for an incremental increase (i.e. 2%); and
(b) A table of remuneration rates in the enterprise agreement was inconsistent with the prescribed incremental increase (see para 11-12 of the Uniting Church decision).

11. Commissioner Roe determined that in the case of such uncertainty it was appropriate to exercise the discretion in section 217 of the Act to vary the Agreement and to order that the variation operate from the date the rates were due to increase under the relevant Agreement (see para 17 and 22 of the Uniting Church decision).

12. The Applicant submits that this is a matter appropriate for the Commission to find that an uncertainty arises in the Agreement and that it is appropriate for the Commission to exercise its discretion to vary the Agreement in accordance with this application.”

THE LAW TO BE APPLIED

[7] Section 217 of the Act provides as follows:

“Subdivision B—Variations of enterprise agreements where there is ambiguity, uncertainty or discrimination

217 Variation of an enterprise agreement to remove an ambiguity or uncertainty

(1) The FWC may vary an enterprise agreement to remove an ambiguity or uncertainty on application by any of the following:

(a) one or more of the employers covered by the agreement;

(b) an employee covered by the agreement;

(c) an employee organisation covered by the agreement.

(2) If the FWC varies the enterprise agreement, the variation operates from the day specified in the decision to vary the agreement.”

[8] The application is made by an employer covered by the Agreement and accordingly the application is properly made as s.217(1)(a) of the Act is satisfied.

[9] Consideration needs to be given to the proper approach to determining applications under this section of the Act.

[10] In Fosterville Gold Mine Pty Ltd 1 (Fosterville) the Commission dealt with an application to vary an agreement pursuant to section 217 of the Act. In that decision there is reproduced a summary of part of the submissions of the respondent in that case, said by the respondent in that matter to be a summary of the proper approach to be applied in determining applications under section 217 of the Act. Commissioner Lewin agreed with that summary and applied it in his decision in Fosterville. The relevant provisions of paragraph 5 of Fosterville are reproduced below:

“a. The Tribunal should approach the matter by way of two stages. Firstly, as a jurisdictional pre-requisite, identify whether there is an uncertainty or ambiguity. Secondly, if an ambiguity or uncertainty has been identified, FWA has discretion whether or not to vary the agreement. Re Tenix Defence Systems Pty Ltd Certified Agreement 2001 - 2004 (Full Bench, 9 May 2002, PR917548) at [28], [32] & [35].

b. The first part of the process (ie identifying ambiguity or uncertainty) involves an objective assessment of the words used in the provisions under examination. The words used are construed having regard to their context. See Re Tenix at [29].

c. The Tribunal will generally err on the side of finding an ambiguity or uncertainty where there are rival contentions advanced and arguable case is made out for more than one contention. See Re Tenix at [31].

d. However, the Tribunal must make a positive finding that the agreement is uncertain or ambiguous. Being satisfied of ambiguity or uncertainty on a prima facie basis is not sufficient. See Colnvest Ltd v Visionstream Pty Ltd (2004) 134 IR 43 at [57].

e. It is not sufficient that there are rival contentions as to the proper construction of the terms of the agreement. Such contentions may be self serving. The Tribunal’s task is to mark an objective judgment as to whether the wording of a provision is susceptible to more than one meaning. See Re Civil Construction Corporation Enterprise Agreement (Ross VP, 13 October 2002, PR939346); SJ Higgins v CFMEU (Williams SDP, 2 May 2001, PR903843); RE CFMEU Appeal (Full Bench, 25 February 1999, Print R2431).

f. In terms of the second stage of the process, once an ambiguity or uncertainty has been identified, in exercising the discretion of the Tribunal whether or not to vary the agreement, the Tribunal is to have regard to the mutual intention of the parties at the time the agreement was made. See Re Tenix at [32].” 2

[11] I agree with Commissioner Lewin that the paragraphs above are an accurate summary of the proper approach to take in determining this matter. The first stage is to determine if, as a jurisdictional pre-requisite, an ambiguity or uncertainty exists. At paragraph 5(e) it says as follows:

“It is not sufficient that there are rival contentions as to the proper construction of the terms of the agreement. Such contentions may be self serving. The tribunal’s task is to mark an objective judgment as to whether the wording of a provision is susceptible to more than one meaning.” 3

[12] Munro J in Construction, Forestry, Mining and Energy Union v Linfox Transport (Australia) Pty Limited 4 (Linfox) dealt with an application under section 170MD(6) of the Workplace Relations Act 1996 (the WR Act). Section 170MD(6) of the WR Act is an analogous provision to that now provided in section 217 of the current legislation.

[13] I refer to paragraph 29 of the Linfox decision, which reads as follows:

“It is manifest that the power to vary the agreement in this instance is dependent upon there being an "ambiguity or uncertainty" in the agreement. Moreover, the power in section 170MD(6) is to be used "for the purpose of removing" the ambiguity so identified. In my view, the analysis applied by a recent full bench decision to the limits on the power in section 298Z to vary an award or agreement to "remove" an objectionable provision, apply by analogy to the power in section 170MD(6). In other words, the power must be exercised to remove any ambiguity. It may not appropriately be used to re-write an agreement to install something that was not inherent to the agreement when it was made.” 5

[14] It follows that in order to establish jurisdiction to exercise the power under section 217, I have to be satisfied that an ambiguity or uncertainty exists. In this case it is said by the Applicant that the uncertainty arises because Clause 19.1 of the Agreement conflicts with the rates set out in Table 2 Section C. Therefore there is uncertainty as to whether or not the rates of pay should be increased as set out in Clause 19.1 or rates of pay should be as set out in Table 2 Section C. It is evident that the rates set out in Table 2 Section C do not reflect a 3% increase on first year rates, as contemplated in clause 19.1. Instead they reflect an increase of slightly more than 5.5% on the rates in the first table. Therefore, the situation arises where in looking to source the entitlement the correct rate of pay from 12 November 2014 for an employee in a classification covered by Section C of the Agreement, that entitlement could be said to be either the rates actually listed in Section C (the higher rate) or it could be 3% more than the rates in table 1 in Section C (the lower rate), as contemplated by clause 19.1 of the agreement. I am satisfied that there is uncertainty as to whether the rates of pay should be increased as set out in clause 19.1 or paid in accordance with the rates set out in Section C.

[15] The Applicant submits that it was the mutual intention of the parties that the rates in Table 2 of Section C would reflect a 3% increase on the first year rates, rather than the apparent 5.5% increase. This is consistent with the text of clause 19.1 and from the calculations in table 2 in both schedule A and B. I note that both unions who are covered by and named as parties bound by the Agreement were provided with this application to vary the agreement. Having been asked by my Chambers to advise if they sought to make submissions or sought to be heard, the CEPU advised, “[t]he CEPU agrees to vary the agreement and does not seek to make submissions nor be heard.” The ARTBIU did not reply to the email from my Chambers.

[16] I am satisfied that the mutual intention of the parties was that the rates in Table 2 of Section C would reflect a 3% increase on the first year rates, rather than the apparent 5.5% increase.

[17] I therefore consider it appropriate to exercise my discretion pursuant to section 217 to vary the Agreement to substitute Table 2 in Section C of the Agreement with the table marked A attached to the variation application. That table is also appended to this decision.

[18] The Applicant seeks that the variation operates with effect from 12 November 2014. I am satisfied this is appropriate given that a wage adjustment is applicable from that date. A consolidated version of the Agreement is attached to this decision.

COMMISSIONER

Attachment A:

 1   [2011] FWA 316

 2   Fosterville Gold Mine Pty Ltd [2011] FWA 316, [5]

 3   Ibid

 4   Print Q2603

 5   Construction, Forestry, Mining and Energy Union v Linfox Transport (Australia) Pty Limited Print Q2603, [29]

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<Price code C, AE407937  PR560031>