Tempo Security v Bolton

[2007] FCA 2027

FEDERAL COURT OF AUSTRALIA

Tempo Security v Bolton [2007] FCA 2027

CORRIGENDUM

TEMPO SECURITY PTY LTD v PAUL BOLTON
NSD 1608 OF 2007

BUCHANAN J
19 DECEMBER 2007
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 1608 OF 2007

ON APPEAL FROM THE CHIEF INDUSTRIAL MAGISTRATE OF NEW SOUTH WALES

BETWEEN:	TEMPO SECURITY PTY LTD Appellant
AND:	PAUL BOLTON Respondent

JUDGE:	BUCHANAN J
DATE OF ORDER:	19 DECEMBER 2007
WHERE MADE:	SYDNEY

CORRIGENDUM

1.In the heading of the orders page and first page of the judgment please replace:

‘On appeal from the Federal Magistrates Court of Australia’

with:

‘On appeal from the Chief Industrial Magistrate of New South Wales’.

I certify that the preceding paragraph is a true copy of the Corrigendum to the Reasons for Judgment of the Honourable Justice Buchanan.

Associate:
Dated:       20 December 2007

FEDERAL COURT OF AUSTRALIA

Tempo Security v Bolton [2007] FCA 2027

TEMPO SECURITY PTY LTD v PAUL BOLTON
NSD 1608 OF 2007

BUCHANAN J
19 DECEMBER 2007
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 1608 OF 2007

ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA

BETWEEN:	TEMPO SECURITY PTY LTD Appellant
AND:	PAUL BOLTON Respondent

JUDGE:	BUCHANAN J
DATE OF ORDER:	19 DECEMBER 2007
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1.The appeal is dismissed.

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

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 1608 OF 2007

ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA

BETWEEN:	TEMPO SECURITY PTY LTD Appellant
AND:	PAUL BOLTON Respondent

JUDGE:	BUCHANAN J
DATE:	19 DECEMBER 2007
PLACE:	SYDNEY

REASONS FOR JUDGMENT

BUCHANAN J:

1. This appeal is brought against a decision of the Chief Industrial Magistrate of New South Wales ordering that the appellant remedy an underpayment of wages to the respondent. 

2. Mr Bolton worked as a security officer.  He was rostered to work for 168 hours in each four-week period.  Having regard to the operation of the Certified Agreement which applied to his employment (The Group 4 NSW Enterprise Agreement 2002-2005 (‘the Certified Agreement’)) 152 of these total rostered hours must be regarded ‘ordinary hours’ representing an average of 38 hours per week.

3. Clause 1.7 Definitions of the Certified Agreement provided:

   ‘Resident Officer:  means an Officer whose hours of work are specified in a known regular roster determined by the Company and issued to the Officer at least seven days prior to the beginning of the roster cycle.

   Reserve Officer:  means an Officer who is not issued with a regular known roster but who is available to be allocated work on at least six days each week and who is advised by the Company of his/her actual hours of work as soon as practical after the requirement to have the work performed by that Officer becomes known to the Company.’

4. Mr Bolton was submitted by the appellant, at first instance, to be a ‘Resident Officer’.  That was not disputed. 

5. Clause 1.7 Definitions of the Certified Agreement also provided:

   ‘Ordinary Hours:  means the hours winch [sic] an employee is rostered to work during shifts for which the required period of notice has been given and winch [sic] are:

   (a)      not in excess of 12 hours during any one shift;

   (b)not more than one shift in any 24 hour period;

   (c)not more than an average of 38 hours in any one week over the four week roster cycle;

   (d)not more than 1976 hours in ally [sic] one year

   (e)is included within the span of hours encompassed by the employees Base Pay Level;

   (f)in the case of a Resident Officer, is included in the employee’s regular roster.

   Overtime Hours: means any hours worked outside of and/or in excess of the limits prescribed for ordinary hours (as defined).’

6. Clause 4.1 and 4.2 (which appear in Part 4 – Ordinary Hours of Work of the Certified Agreement) provided:

   ‘4.1     Ordinary Hours:
   All Security Officers may be rostered to work ordinary hours (as defined) on any shifts including weekends and public holidays.

   4.2      Rosters:
   Provided that the flexibility inherent in clause 4.1 is not undermined and the parameters are not breached it is agreed that the company will use its best endeavours to implement rosters in the following manner:

   4.2.1    Work will be rostered over an [sic] four (4) week 28 day cycle with a standard roster(s) applying to full time employees.

   4.2.2    The duration of shifts for employees will be a maximum of 12 hours rostered to average 38 hours per week calculated over the roster cycle.

   4.2.3    No more than 1976 hours rostered over any 12 month period.

   4.2.4    No more than one shift shall be rostered to commence during any period of 24 consecutive hours.
   (emphasis added)

7. Clauses 5.1 and 5.2 (which appear in Part 5 – Overtime) provided (relevantly):

   ‘5.1     “Overtime hours” means all hours of work not encompassed by the definition of ordinary hours.

   5.2      “Overtime Rate ‘A’ means the rate payable for overtime winch [sic] is, in the case of Resident Officers, included within the employee’s regular roster and which is, in any case, not in excess of 24-hours in any fortnight.’

8. The Certified Agreement required payment as a Level 1, Level 2 or Level 3 employee in accordance with the percentage of ordinary hours worked as ‘day work on week days’.  If less than 36% of Mr Bolton's ordinary hours fell into this category he was entitled to be paid as a Level 3 employee.

9. Clause 1.7 Definitions and Clause 3 - Payment of Wages of the Certified Agreement each provided:

   ‘Level 1 is the rate payable to Employees who work ordinary hours only on week days and with at least 51% of their ordinary hours as day work on week days;

   Level 2 is the rate payable to Employees who work ordinary hours either;

   (i)       only on week days and with less than 51% of their ordinary hours as day work on week days, or

   (ii)      on both week days and weekends and with at least 36% of their ordinary hours as day work oil [on] week days.

   Level 3 is the rate payable to Employees who work ordinary hours on both week days and weekends and with less than 36% of their ordinary hours as day work on week days.’
   (emphasis added)

10. No roster published by the appellant, showing any allocation of work to Mr Bolton as ordinary hours and rostered overtime in the roster period, was in evidence.  However, timesheets prepared by Mr Bolton each fortnight were in evidence.  They identified some work as ordinary hours, some as rostered overtime and some as unrostered overtime.  These time sheets were countersigned as correct by a supervisor.  Mr Bolton's calculations were made using the period 17 January 2005 to 13 February 2005 as an example.  This period corresponds in both starting date and finishing date to the first and last days of completed timesheets.   The timesheets showed eight hours overtime being worked on one Friday day shift and eight hours overtime being worked on one Friday night shift in each roster period.  The calculations showed that Mr Bolton worked 52 out of 152 ordinary hours on day shift on week days (34.2105%).  In accordance with Mr Bolton's calculations he should have been paid as a Level 3 employee but he was paid instead as a Level 2 employee.

11. The respondent’s calculations proceeded by reference to a standard set of roster ‘lines’ although there was no evidence that the allocation of hours as ordinary hours or rostered overtime which they contained had been published in advance.  The effect of these documents (which were advanced before the Chief Industrial Magistrate as part of the appellant’s submissions to him) was to allocate Mr Bolton’s rostered overtime exclusively to Sundays.  They attributed overtime hours to the first and third weeks in a standard roster period.  This was done on the basis that those weeks involved working hours of 48 (of which two hours were carried forward as ordinary hours and eight hours were overtime) while the second and fourth weeks involved working hours of 36 (all ordinary hours to which 2 hours were notionally added from the previous week).  On this approach the overtime fell always on a Sunday in the first and third ‘lines’.  The result was that Mr Bolton was shown as working 59 out of 152 ordinary hours on day shift on week days (38.82%).  On this calculation, Mr Bolton was correctly paid at level 2.

12. Each party agreed that the other's calculations were mathematically correct.  The difference between them arose because they selected a different starting time for the period under examination.

13. The Chief Industrial Magistrate came to the view that the Certified Agreement was deficient because it did not adequately identify the appropriate starting point for the calculation.  He also concluded that the agreement was deficient and arbitrary because it excluded rostered overtime from the calculation.  Rather than decide whether Mr Bolton's calculations were correct or those of the respondent he decided to independently calculate the hours worked on day shift on week days with rostered overtime included.  Such an approach appeared to resolve the problem of selecting an appropriate starting point and the difference in result which was thereby thrown up.

14. Mr Bolton worked, including rostered overtime, 14 x 12 hour shifts each four weeks (168 hours).  The Chief Industrial Magistrate observed that five of these shifts were day shifts worked on week days.  This equated to 35.72% of total rostered hours.  On this basis the Chief Industrial Magistrate concluded that Mr Bolton was entitled to be paid as a Level 3 employee.

15. The immediate difficulty revealed by this approach is that it does not accord with the calculation directed by the Certified Agreement.  In my view, adopting this approach went beyond interpreting the Certified Agreement and amounted to a judicial variation of its terms.

16. The Certified Agreement assumed the existence of identifiable fortnightly pay periods.  For example, it provided for three wage increases during its life.  They took effect, respectively from the beginning of the first pay periods to commence on or after 1 July 2003, 1 March 2004 and 1 January 2005.  Furthermore, Clause 3.11 provided (relevantly):

    ‘3.11    Pay period:  Salaries will be paid by EFT into a nominated account within 72 hours of the completion of each fortnightly pay period.’
    (emphasis added)

17. The fact that Mr Bolton was a Resident Officer engaged a further provision of the Certified Agreement.  Clause 4.5 provided:

    ‘Rosters for Resident Officers will include an average of 38 ordinary hours per week (averaged over the full roster cycle) and may also include up to 12 hours of rostered overtime in any one week.  If rostered overtime is included then the shifts and/or parts thereof which constitute overtime shall be clearly identified as such on the roster.’
    (emphasis added)

18. The parties were agreed that in each roster period there was both ordinary time and rostered overtime included in Mr Bolton’s rostered hours but there is no evidence that any rostered overtime was clearly indicated, as required, in rosters published in advance by the appellant.  Had such rosters been in evidence the necessary calculations would need to be made in accordance with them.  In the absence of any identification, as required by clause 4.5, of how much rostered overtime (and when) in each fortnight or roster period Mr Bolton was to work, other methods of resolving the issue must be considered.  In my view it should be accepted that the fortnightly pattern of work shown in Mr Bolton’s timesheets reflects actual working arrangements and is in accordance with pay periods observed at the workplace.  That pattern of work is not inconsistent with the requirements of the Certified Agreement.  Mr Bolton’s timesheets showed the last 8 hours in each pay period (i.e. over and above 76 ordinary hours) as rostered overtime.  In the absence of any evidence to the contrary I think these records should be accepted.  The result is, as he contends, that less than 36% of his rostered ordinary hours were worked on day shift on a weekday.

19. Were the timesheets not accepted the matter would fall to be determined by a strict application of the Certified Agreement.  Under the Certified Agreement work was to be rostered over a four-week 28 day cycle.  Shifts were ‘a maximum of 12 hours rostered to average 38 hours per week calculated over the roster cycle’.  Overtime was ‘all hours of work not encompassed by the definition of ordinary hours’.  In the absence of evidence to the contrary, the first 152 hours in a roster cycle should be counted as ordinary hours and the remaining 16 hours should be counted as overtime hours.  Whether the respondent’s roster ‘lines’, which were advanced in submissions, are referred to or Mr Bolton's timesheets the 16 hours of overtime notionally fall on a Thursday (four hours) and on a Friday (12 hours) at the end of each roster period.  The result would be that 44 hours of Mr Bolton's 152 ordinary hours in each roster cycle fell on day shift on a week day.  This is 29% of his ordinary hours.  This alternative approach supports his claim also.

20. Although not for the reasons given by the Chief Industrial Magistrate which, with respect, I am unable to share, the appeal must be dismissed.  I will so order.

I certify that the preceding twenty (20) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Buchanan.

Associate:
Dated:        19 December 2007

Counsel for the Appellant:	R Manuel
Solicitor for the Appellant:	EMA Workplace Lawyers
Counsel for the Respondent:	J Nolan
Representative for the Respondent:	Liquor, Hospitality and Miscellaneous Union (NSW Branch)
Date of Hearing:	7 December 2007
Date of Judgment:	19 December 2007