Taylor, M.H. v The Gordon Frost Organisation P/L Taylor, M.H. v Hayden Attractions P/L Taylor, M.H. v Sydney Dance Company

[1992] FCA 686

Re: MICHAEL HENRY TAYLOR
And: HAYDEN ATTRACTIONS PTY LTD; SYDNEY DANCE COMPANY and THE GORDON FROST
ORGANISATION PTY LIMITED
Nos. N I4 of 1992, N I34 and N I35 of 1991
FED No. 686
Industrial Law

COURT

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY
INDUSTRIAL DIVISION
Wilcox J.(1)

CATCHWORDS

Industrial Law - Alleged contravention of award - Payment to casual theatrical employees for "bump out" work - Applicable hourly rates - Interpretation of award.

Industrial Relations Act 1988, s.178 Theatrical Employees' (Live Theatre and Concert) Award 1982

HEARING

SYDNEY

#DATE 18:9:1992

Counsel for the Applicant: Jim Nolan

Solicitors for the Applicant: Jones Staff and Co

Counsel for the Respondent: David Roff

Solicitors for the Respondent: Mark G Caldwell

ORDER

No. N I4 of 1991

THE COURT ORDERS THAT:

1. Within 21 days the respondent pay to Marcus Kelson the sum of $114.49 being the amount of the underpayment of wages due to him.

No. N I35 of 1991

THE COURT ORDERS THAT:

1. Within 21 days the respondent pay to Marcus Kelson the sum of $27.77 being the amount of the underpayment of wages due to him.

No. N I34 of 1991

THE COURT ORDERS THAT:

1. Within 21 days the respondent pay to Iain Anderson the sum of $59.00 being the amount of the underpayment of wages due to him.

2. Within 21 days the respondent pay to David Johnson the sum of $51.64 being the amount of the underpayment of wages due to him.

3. Within 21 days the respondent pay to Nicholas Germain the sum of $51.64 being the amount of the underpayment of wages due to him.

4. Within 21 days the respondent pay to Andrew Duff the sum of $51.64 being the amount of the underpayment of wages due to him.

5. Within 21 days the respondent pay to Angus Longstaff the sum of $59.00 being the amount of the underpayment of wages due to him.

6. Within 21 days the respondent pay to Pauline Adamak the sum of $54.10 being the amount of the underpayment of wages due to her.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

JUDGE1

By consent of the parties these three matters have been dealt with together. They each raise the same problem: the proper interpretation of clauses 8 and 11(f) of the Theatrical Employees' (Live Theatre and Concert) Award 1982. The facts are not in dispute and, because of the difficulty of arranging an early hearing date convenient to both counsel, the matters were argued by means of written submissions.

1. The applicant, Michael Henry Taylor, is the New South Wales Branch Secretary of the Australian Theatrical and Amusement Employees' Association ("ATAEA"), an organisation of employees registered under the provisions of the Industrial Relations Act 1988.

2. Each of the respondents to the applications, Hayden Attractions Pty Limited, Sydney Dance Company and The Gordon Frost Organisation Pty Limited, is a theatrical entrepreneur and a respondent to the Award. In each case, Mr Taylor alleges that the relevant respondent failed to pay a particular person or persons the amount to which he or they were entitled for "bumping out" work after the closure of a live show. In each case Mr Taylor seeks the imposition upon the respondent of a penalty, pursuant to s.178 of the Industrial Relations Act 1988, and an order for payment to the particular employee or employees of the money allegedly owing. However, although these orders are genuinely sought, a major cause of the proceedings was the union's desire to obtain a ruling upon a matter of interpretation which has long vexed the relationship between the union, and some of its members, and employers in the theatrical industry.

3. The claim against Hayden Attractions arises out of the closure, on Saturday, 26 May 1990, of a production called "Anything Goes". An ATAEA member, Marcus Kelson, was engaged on a casual basis by Hayden Attractions to "bump out" the show. He apparently worked from 11pm on the Saturday night until 1pm on the Sunday, with a one-hour meal break between 8am and 9am. He was paid $17.19 for the first hour, on Saturday evening, and $23.54 per hour for each of the 12 hours worked on the Sunday - a total of $299.67. Mr Taylor claims that Mr Kelson should have been paid $29.12 for the first hour ($14.56 per hour at double time), $38.06 per hour ($19.03 at double time) from midnight until 8am and $20.14 per hour ($10.07 at double time) from 9am until 1pm. The total comes to $414.16, leaving a balance of $114.49 gross wages.

4. The Sydney Dance Company case involves six ATAEA members, Iain Anderson, David Johnson, Andrew Duff, Nicholas Germain, Angus Longstaff and Pauline Adamak. They were each casual employees engaged to "bump out" the dance production "Woman" which closed on Saturday, 11 August 1990. They worked after the show, commencing at various times between 10pm and 10.30pm, and all finishing at 3am on the Sunday morning. For the period until midnight each employee was paid at the rate of $17.06 per hour, after midnight at $22.25 per hour. Mr Taylor says that they should each have been paid at the rate of $14.71 per hour until 11pm, thereafter double time, $29.42, for the hour until midnight and at the rate of $38.58 per hour ($19.29 at double time) until 3am. In the result, he says the six members were short-paid various sums of money ranging from $51.64 to $59.00.

5. The final claim, against Gordon Frost Organisation, also involves Mr Kelson. It relates to an earlier closure, that of "Dancin' Man" on Sunday, 25 March. Here also, Mr Kelson was a casual employee. It seems that he worked from midnight on Sunday until 1pm on the following day, with a meal break between 8am and 9am; and then again from 11.30 that evening until 8.30am the following day. He was paid a gross wage of $476.22. Mr Taylor says that he should have been paid $503.99, so he was underpaid $27.77.

6. It is not easy to reconcile the various figures given to me. One of the complications is that Hayden Attractions and Gordon Frost are respectively respondents to two "second tier" awards made in February 1992 but back-dated to December 1989. The Sydney Dance Company is not a respondent to either of those awards, or any equivalent, but the present claims against that company are subject to a variation in the parent (1982) award effected on 15 August 1990 but back-dated to 17 April 1990. Perhaps largely because of these retrospective amendments, counsel for the parties, even with the assistance of their instructing solicitors and informed officers of their client organisations, found difficulty in determining what amounts they contended to be properly payable. There seems to be a strong case for simplifying the relevant award provisions and for reducing retrospectivity by more rapidly processing agreed variations.

7. The award was made by Commissioner McLagan on 20 October 1982. It was appended to a decision in which the Commissioner stated reasons for aspects of the award. That decision is reported: see (1982) 283 CAR 109. In relation to casual "bumping out" work, Commissioner McLagan stated, at 113:
   

"A further claim concerned casual back stage employees required for 'Bumping Out Work.'

After hearing the parties and also the submissions for the inclusion of the new paragraphs 8(1)(i) and (ii) the Commission is not prepared to amend subclauses 8(j) and (k) except to include in subclause 8(k) provision for a minimum payment for three and a half hours. The rates set out in subclauses 8(j) and (k) are in the award by agreement between the parties and the history associated therewith is clearly understood within the industry."

1. Clauses 1 to 6 of the award deal with formal matters: title, arrangement of contents, application of the award, operation and duration, supersession of previous awards and preservation of existing conditions. Clause 7 sets out minimum weekly rates of pay for employees in various classifications. Clause 8 deals with terms of engagement. Sub-clause (a) requires that all employees on a permanent staff be engaged by the week "unless a longer period of engagement be agreed to between the parties concerned". Sub-clauses (b), (c), (d) and (e) deal with aspects of weekly employees' employment. They are presently immaterial. Sub-clauses (f) to (l) relate to casual employees. As originally framed, they read:
   

"(f) The appropriate per hour rate for casual employees is calculated by dividing the total per week rate (as specified in clause 7) for the relevant classification by the total number of ordinary hours required to be worked by a weekly employee in that classification and adding a 20 per cent loading on such hourly rates so calculated.

(g) Casual employees shall be engaged for a minimum period of three and a half hours.

(h) The employment of a casual employee may be terminated without notice by either side subject to the payment of any prescribed minimum amount of wages and subject to the employee working the time covered by such a minimum amount if required to do so.

(i) (1) A casual employee who works more than eight hours on any day shall be paid overtime at the rate of time and a half for the first two hours and double time thereafter.

(2) A casual employee who works more than 40 hours (excluding overtime worked on a daily basis) in any one week shall be paid for all hours in excess of forty time and a half for the first four hours and double time thereafter.

(j) Casual employees not engaged to work a performance shall be paid at the following hourly rates which include loading for casual work, with a minimum payment for three and one half hours. $

8 a.m. to 6 p.m. 6.89

6 p.m. to midnight 10.34

midnight to 8 a.m. 13.78

(k) Casual back stage employees engaged for a performance when required for bumping-out work between the conclusion of the performance on Saturday night and 8 a.m. Sunday shall be paid $17.21 per hour with a minimum payment of three and a half hours.

(l) (i) If engaged for a performance, additional work associated with that performance shall be paid in accordance with subclause 8(f). Such engagement shall be continuous.

(ii) Casual employees engaged for work not associated with a performance who work in excess of three and a half hours and then work a performance shall continue to be paid as prescribed in subclause 8(j) for all work on that day."

1. The hourly amounts shown in cl. 8(j) were amended by the 15 August 1990 variation to be, respectively, $10.22, $14.71 and $19.29. The "second tier" rates were $10.07, $14.56 and $19.03.

2. Clause 9 is headed "Hours of Work and Time Off". Subclauses (a) to (g) seem to be directed exclusively to permanent employees. sub-clause (h) applies to all employees. It provides, subject to two exceptions, that no employee shall be permitted to work on more than six days in any one week. Clause 10 deals with overtime. For the most part, it relates only to permanent employees; but there may be some provisions of the clause which apply to casuals. The clause is immaterial to this case.

3. Clause 11 is entitled "Sundays". It opens with the words: "For any work done between 11pm on Saturday and 5.45am on Monday, payment shall be as follows:". Then follow sub-clauses (a) to (d), dealing with weekly employees, and sub-clause (e) relating to night cleaners. Sub-clause (f) reads:
   

"(f) If the employee is engaged otherwise than by the week - double the ordinary prescribed rate. Provided that, in the case of an employee employed in connection with a performance on Saturday night continuing work, double time will commence as from midnight for that portion of work time after midnight. Provided also that in the case of an employee commencing work on Monday before 5.45 a.m. double time will be payable for that portion of working time before 5.45 a.m."

1. Sub-clauses (g) and (h) revert to the subject of weekly employees. Accordingly, cl.11(f) is the only provision arguably concerned with Sunday rates for casual employees. The problem in these cases arises out of the interaction of that sub-clause with cl.8.

2. The award goes on to deal with other matters; none of them touch the present problem.

3. The critical question is the meaning of the words in cl 11(f), "the ordinary prescribed rate". Counsel for the applicant submits that the words refer to what he calls the "three-tiered" rate structure provided by cl 8(j); each tier being the ordinary rate for that part of the day during which the employee worked. Counsel puts as an example an employee who works for a ten hour period from 4pm one day until 2am the next. That employee would be entitled to be paid at the lowest rate, $6.89 in 1982, for each of the two hours from 4pm till 6pm, at the intermediate rate, $10.34, for each of the six hours from 6pm until midnight and at the highest rate, $13.78, for each of the two hours from midnight until 2am. The effect of cl.11(f), says counsel, is to require that these hourly rates be doubled in respect of any hours worked which happen to fall between 11pm on Saturday (midnight if the employee has been engaged in connection with a performance that evening) and 5.45am on Monday.

4. In support of his interpretation, counsel draws attention to a decision of the Full Bench of the Australian Conciliation and Arbitration Commission (Cohen J, Deputy President Keogh, Commissioner Sheather). The Full Bench dismissed an appeal by the Theatre Proprietors' and Entrepreneurs' Association ("TPEA") against the award made by Commissioner McLagan on 20 October 1982. That decision, which is reported at (1983) 288 CAR 254, reveals that the major point of contention was cl 8(j). TPEA said that this clause was ambiguous and argued that it should be amended so as to provide for work between 8am and 6pm being at single time (the rate being calculated by reference to the hourly rate provided by cl.8(f)), work between 6pm and midnight being at time and a half and work between midnight and 8am being at double time. TPEA suggested that there was conflict between the terms of sub-clauses (f) and (j) and the terms of sub-clauses (j) and (k). In dealing with this latter matter, the Full Bench referred to cl.11(f) commenting, at 256:
   

"The application of penalty rates under subclause 11(f), double time for Sunday work, to subclause 8(j) results in payment of $27.56 per hour for non performance employees doing bump out work between midnight Saturday and 8 a.m. Sunday, while those who have already worked a performance receive $17.21 per hour for the same work under subclause 8(k)."

1. Apparently, the accuracy of this interpretation of the subclause - which is, of course, consistent with the present applicant's argument - was accepted by all parties before the Full Bench and the Full Bench itself. I say this because the Full Bench decision, at 257, discuss the reasonableness of this result:
   

"It was argued that the Commissioner should have recognised the inequity of this situation and amended subclauses 8(j) and (k) to ensure that the rate of $13.78 per hour for non-performance employees did not attract double time on Sunday morning. Subclause 8(j) already provides penalties of time and a half for work performed between 6 p.m. to midnight and double time from midnight to 8 a.m. and it was submitted that an additional penalty of double time for bump out work carried out between Saturday midnight and 8 a.m. Sunday amounted to a penalty on a penalty.

The Commissioner was aware of the differential basis of payment between performance and non-performance employees for bump-out work between Saturday midnight and 8 a.m. Sunday. There was evidence before him that $27.56 per hour was being paid to non-performance employees for this work in the Theatre Royal in Sydney and the Comedy and Her Majesty's Theatres in Melbourne. The rate had evidently been paid in the Theatre Royal since 1973.

There was a conflict of evidence both before him and before us as to how extensively the higher rate is paid in the industry. In the appeal proceedings the employers stated that the rate is no longer being paid in the Melbourne theatres. Whatever the incidence of the payment, it is clear that the higher rate has been paid and is still being paid in some theatres.

The Commissioner understood the 'inequity' of the situation as the union had sought for this reason to bring everyone up to $27.56 per hour for bump-out work between Saturday midnight and 8 a.m. Sunday. While he was unwilling to do this, he was also unwilling to bring about an amendment which would have the effect of reducing rates where the higher amounts were being paid by $10 per hour. A suggestion that everyone should be placed on the same rate of $17.21 per hour was rejected by the parties. Faced with the alternatives before him, the Commissioner refused both the employers' and the union's applications and stated: 'The rates set out in subclauses 8(j) and (k) are in the award by agreement between the parties and the history associated therewith is clearly understood within the industry.'

The appellant argued before us that subclause 8(j) was not agreed, that the subclause just 'slipped through'. We do not accept this submission. The parties were some four years negotiating the draft award which was finally handed up to Mr Justice Robinson on 9 March 1981 as a consent document, subclauses 8(j) and (k) being part of that document. On 11 March 1982 the TPEA circularised its members informing them of the contents of the new award and in that circular, it specifically referred to the fact that casual employees not engaged to work a performance were not covered by subclause 8(f), but by subclause 8(j). Although the provision did not come into operation for another month, these matters were not raised in that time. It is our view that in these circumstances the employers cannot establish lack of consent."

1. The argument put in the present cases on behalf of the respondents is that subclauses (f) to (l) of cl 8 constitute a code as to the rates of remuneration payable to casuals. Therefore, it is said, cl 11 does not apply to casuals; cl 11(f) is not concerned with casuals but with employees engaged for longer than a week, a possibility envisaged by cl 8(a). Counsel says that this is the sensible and logical construction of the award; if it is not adopted there are a number of direct conflicts between award provisions: between cl 8(k) and cl 11(f), between cl 8(l)(i) and 11(f); between cl 8(j) and 11(f). Moreover, if cl 8(k) operates exclusively of cl 11(f), but cl 8(j) does not, persons engaged under cl 8(j) would be paid considerably more than those engaged under cl 8(k). Finally, it is said that cl 8(l)(ii) makes cl 8(j) applicable to all time worked by casual employees engaged for work not associated with a performance but subsequently required to work a performance on that day.

2. I prefer the submissions put on behalf of the applicant. There is no justification for confining the application of cl 11(f) to employees engaged for longer than a week. A casual employee is an "employee engaged otherwise than by the week". It having been thought proper, in terms of policy, to grant a special allowance for Sunday work, there is no discernible reason why that policy should not apply to casual employees. It is true that casual back stage employees engaged for a performance do not receive double time under cl 11(f); but cl 8(k) provides them with a special rate for their work until 8am Sunday.

1. I do not think that the conflicts suggested by counsel really exist. As to cl 8(k) and cl 11(f), the position is not one of conflict but rather of the specific provision of cl 8(k) applying to the exclusion of the generally worded cl 11(f). Some might think the result anomalous but the Full Bench decision makes plain that it was specifically intended. Clause 8(l)(i) does not conflict with cl 11(f). The former provision sets a standard rate. The latter doubles it for Sunday work; similarly with cl 8(j) and cl 11(f). Clause 8(l)(ii) also sets a rate. It too is subject to the effect of cl 11(f) for Sunday work.

2. The respondents put an alternative submission: that, if cl 11(f) does apply to casuals, the "ordinary prescribed rate" is, for non-performance casuals and cleaners, the 8am - 6pm rate and, for performance casuals, the rate prescribed by cl 8(f). I prefer to say nothing about performance casuals or cleaners; their cases do not presently arise. But in relation to non-performance casuals, I see no justification for this interpretation. The "ordinary prescribed rate" referred to in cl 11(f) is the ordinary hourly rate for the particular category of employee working at the relevant time of day. For non-performance casuals, there is not a single ordinary rate. There are three different ordinary rates, the relevant rate depending when the work is done. In its application to any particular case, cl 11(f) requires the ascertainment of the hourly rate applicable to the time when the work is done and the doubling of that rate for Sunday work.

3. Applying the above interpretation, I return to the applicant's claims. In relation to Mr Kelson's work for Hayden Attractions, he started at 11pm on the Saturday night. As he was not engaged to work a performance cl 8(j) applied but with the rates substituted by the 1992 "second tier" variation. For the hour until midnight he was entitled to double the ordinary 6pm-midnight prescribed rate, that is twice $14.56 or $29.12. For the eight hours until 8am Mr Kelson was entitled to twice the midnight-8am ordinary rate ($19.03 per hour), that is $38.06 per hour. For the final four hours he was entitled to twice the 8am to 6pm rate of $10.07 per hour, that is $20.14. This is all as claimed by the applicant. There is a balance of $114.49 payable to Mr Kelson. I will order Hayden Attractions to pay this balance.

4. The rates relevant to the employees of Sydney Dance Company are different. But, once again, the claim made by Mr Taylor on their behalf is accurate. I propose to make orders in accordance with his calculations.

5. The claim against Gordon Frost involves "Sunday work" only for the first 5 1/4 hours, from midnight on the Sunday until 5.45am on Monday: see the opening words to cl.11 of the award. The subsequent computation is complicated by the employee's entitlement to different penalty loadings, because of having worked more than eight hours (and then ten hours) in a shift. But, once again, Mr Taylor's calculation is correct. There is a deficiency of $27.77 and an order for payment of this amount should be made.

6. I do not think that penalties should be imposed in these cases. In calculating the payments which they made to their employees, the three respondents apparently acted on the advice of TPEA, genuinely believing that advice to be correct. Although I have concluded that TPEA's interpretation is wrong, there is no reason to doubt that TPEA genuinely believed it to be correct. The award is not easy to construe. I take the view that substantial penalties ought to be imposed on employers who deliberately flout award provisions or who act with careless disregard of the question whether or not they are complying with their award obligations. But, equally, I think it is wrong to penalise employers who genuinely attempt to comply with an award, acting reasonably on the advice of their trade association, simply because this advice is held incorrect.