The Association of Professional Engineers, Scientists and Managers, Australia v Jemena Asset Management Pty Ltd

[2013] FWC 5617

[2013] FWC 5617

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

The Association of Professional Engineers, Scientists and Managers, Australia
v
Jemena Asset Management Pty Ltd
(C2013/200)

COMMISSIONER BISSETT MELBOURNE, 21 AUGUST 2013

Alleged dispute concerning Clause 10 Introduction of Change and Technology and Clause 15 Redundancy of the Agreement.

[1] The Association of Professional Engineers, Scientists and Managers, Australia (APESMA) has made an application for the Commission to deal with a dispute pursuant to the Jemena Asset Management Agreement (Vic) 2009 (the JAM Agreement).

[2] The dispute was notified to the Commission on 11 February 2013.

[3] In essence it appears that the dispute goes to matters associated with the work allocated to APESMA member Mr Doug Hardy, and the implications this has as to the enterprise agreement that applies to Mr Hardy.

[4] Mr Hardy works for Jemena Asset Management Pty Ltd (Jemena).

[5] Prior to dealing with the merits of the matter in dispute Jemena raise two jurisdictional objections to the matter being dealt with. It is appropriate that these objections be dealt with in the first instance.

The JAM Agreement ceased to apply and operate with respect to Hardy on 22 February 2013

[6] Jemena submit that on 22 February 2013 the JAM Agreement ceased to apply and operate with respect to Mr Hardy because, on that date, the ZNX Victorian Staff Enterprise Agreement 2012 (the Zinfra Agreement) commenced to operate and that agreement applies to Mr Hardy’s employment.

[7] Mr Hardy was covered by the JAM Agreement. The Zinfra Agreement came into operation on 22 February 2013. The Zinfra Agreement, at clause 2 states that it applies to ZNX and JAM (the employers) and ZNX employees engaged in roles outlined in the classification structure in Schedule A.

[8] Clause 3 of the Zinfra Agreement defines ‘ZNX employee’s (sic)’ to ‘mean employees engaged in line with the scope of the agreement in the ZNX organisation structure.’

[9] JAM submits that Mr Hardy falls within the scope of the Zinfra Agreement by definition.

[10] Jemena submits that, as a consequence of Mr Hardy being covered by the Zinfra Agreement on and from 22 February 2013, the Commission ceased to have jurisdiction to deal with the dispute under the JAM Agreement. Jemena rely on Senator the Honourable Eric Abetz v Stephenson 1(Stephenson), Pulle v Commonwealth of Australia2(Pulle) and de Jong v Australian Broadcasting Corporation3(de Jong) in support of its contention.

[11] APESMA submits that Mr Hardy is not covered by the Zinfra Agreement and hence the jurisdictional objection of Jemena has no substance.

Consideration

[12] The JAM Agreement came into operation on and from 25 January 2010. Its nominal expiry date is 31 December 2011. 4

[13] The Zinfra Agreement came into operation on 22 February 2013 with a nominal expiry date of 1 July 2014. 5

Does the Zinfra Agreement apply to Mr Hardy?

[14] The Zinfra Agreement states, in respect of coverage:

2. APPLICATION AND COVERAGE OF THIS AGREEMENT

2.1 This Agreement covers and applies to:

a) ZNX & JAM

b) ZNX employees engaged in Victoria in accordance with the roles outlined in the classification structure in Schedule A

together, ‘Parties’.

[15] Clause 3 of the Zinfra Agreement contains a number of definitions including the following:

3. DEFINITIONS

Jemena Asset Management

(JAM)

shall mean Jemena Asset Management Pty Ltd ABN 53 086 013 461

ZNX

ZNX Pty Ltd (ZNX) ABN 82 073 613 733

ZNX (2) Pty Ltd (ZNX2) ABN 52 104 352 650

ZNX Employee’s (sic)

Shall mean employees engaged in line with the scope of the agreement in the ZNX organisation structure

[16] Mr Hardy is employed by Jemena Asset Management. This is the same company as is covered by the Zinfra Agreement (see definition above). I am therefore satisfied that the company Mr Hardy is employed by is covered by the Zinfra Agreement.

[17] Mr Hardy is employed as an Electrical Protection and Control Design Engineer. 6

[18] The classification structure relevant to coverage of the Zinfra Agreement is in Schedule A to the Agreement. That classification structure includes the following:

Professional specialists Class 1 (P2)

An employee engaged at this level will have achieved the skills/ knowledge and qualifications of the graduate engineering levels. A professional employee at this level performs duties requiring the application of mature knowledge. The employee is an experienced professional who plans and conducts work without detailed supervision but with guidance on unusual features of work and who is usually engaged on more responsible assignments.

An employee may plan, direct, co-ordinate and supervise the work of other professional or technical employees.

A specialist employee at this level works independently as a specialist and or a senior member of a project team, exercising limited managerial responsibility where they are accountable for output.

...

● Protection and Control Design Engineer

An employee technically qualified to provide the protection and control design with the planning, coordination and management of material, human and capital resources and under guidance to resolve complex engineering assignments from concept through to design implementation, entailing technical specifications and detailed planning, and provide technical engineering advice to key stakeholders across multiple departments as required.

[19] Absent any submissions to the contrary by APESMA I accept the submissions of Jemena that Mr Hardy performs duties and work in accordance with the classification structure in Schedule A to the Zinfra Agreement.

[20] A ZNX employee, as used in the coverage clause of the Zinfra Agreement, is one ‘engaged in line with the scope of the agreement in the ZNX organisation structure.’

[21] In this instance Mr Hardy is engaged in line with the scope of the Zinfra Agreement.

[22] The question remains as to whether or not he is ‘in the ZNX organisation structure.’

[23] The evidence of Mr Antoniou, a Team Leader with Jemena, is that around 2008 there was a restructure of the work groups within which Mr Hardy worked. This occurred at the time groups moved from Collins Street and Moorabbin to Clayton. These separate work groups had previously worked for Jemena (on the Jemena Electrical Network (JEN)) or for Alinta (on the United Energy Network). These employees were divided between ‘primary protection and control’ group and a ‘secondary’ group with each group working across both JEN and United Energy assets within the primary or secondary work. Mr Hardy worked in the secondary group. He was generally allocated work on the JEN assets as this was his area of knowledge (having come from the Jemena side of the business). Mr Antoniou was his supervisor at this time. 7 In 2011 there was a further restructure which resulted in the formation of two groups – one to look after exclusively JEN assets and the other to look after United Energy and third party assets. Mr Hardy was allocated to the design team looking after United Energy and third party assets.8 At this time Mr Antoniou ceased supervising Mr Hardy as Mr Antoniou supervised those employees working on JEN assets.

[24] The evidence of Mr Colin Harrison, Manager Southern Engineering for Zinfra, is that the 2011 reorganisation was undertaken in preparation for the separation of the Jemena and Zinfra businesses. 9 Mr Harrison’s evidence is that Mr Hardy was allocated to the United Energy team.10 Following this reorganisation employees working on the JEN assets were relocated to Mt Waverly. Mr Hardy remained at the Clayton site.

[25] On the basis of this evidence I conclude that Mr Hardy did, following the organisational change of 2011, work in the ‘ZNX organisation structure’ as he was allocated to work primarily on United Energy assets. It is the case that Mr Hardy remains employed by Jemena Asset Management. 11 Mr Hardy is not employed by Zinfra and there is no claim that he is (although it appears that Zinfra have taken over responsibility for the provision of, for example, HR services for Mr Hardy).

[26] I accept that Mr Hardy was aware of the impending separation of the Jemena and Zinfra work. 12 While it was not a matter of argument before me it is not clear that it was fully apparent to employees affected by the reorganisation such as Mr Hardy what the real and practical effect of the changes over the period 2011 and 2012 would be.

[27] I am, however, satisfied and find that Mr Hardy is working in the ‘ZNX organisation structure’ (noting that this does not affect who actually employs him).

[28] I therefore find that Mr Hardy is employed by JAM (which is an employer covered by the Zinfra Agreement and to which the Agreement applies), he is a ZNX employee (as defined by the Zinfra Agreement) and he is engaged in Victoria in accordance with the roles in the classification structure in Schedule A to the Zinfra Agreement. I am therefore satisfied that Mr Hardy is covered by the Zinfra Agreement and it applies to him and his employment.

Can Mr Hardy pursue a dispute under the JAM Agreement?

[29] In Stephenson the Full Bench determined that it was not possible to arbitrate under the dispute settling provisions of an enterprise agreement unless that agreement existed. In that case the enterprise agreement under which the dispute had been notified had been replaced by a new agreement and the later agreement made it explicit that the previous agreement was excluded from operation.

[30] The Full Bench in Stephenson concluded that:

...if a certified agreement empowering the Commission to settle disputes over the application of the agreement ceases to operate because of the provision of s.170LX of the Act, then the Commission no longer has jurisdiction to exercise that private arbitration power in the agreement. 13

[31] The relevant principle to be drawn from Stephenson is that the Commission’s jurisdiction to deal with a dispute over the application of an agreement is a jurisdiction that must be conferred by the agreement itself and any limits imposed by the Act.

[32] Section 170LX in the Workplace Relations Act 1996, as applied at the time of the decision in Stephenson, states:

170LX When a certified agreement is in operation

(1) A certified agreement comes into operation when it is certified and, subject to this section, remains in operation at all times afterwards.

(2) The agreement ceases to be in operation if:

(a) its nominal expiry date has passed; and

(b) it is replaced by another certified agreement.

[33] Section 58 of the FW Act states:

58 Only one enterprise agreement can apply to an employee

Only one enterprise agreement can apply to an employee

(1) Only one enterprise agreement can apply to an employee at a particular time.

General rule—later agreement does not apply until earlier agreement passes its nominal expiry date

(2) If:

(a) an enterprise agreement (the earlier agreement) applies to an employee in relation to particular employment; and

(b) another enterprise agreement (the later agreement) that covers the employee in relation to the same employment comes into operation; and

(c) subsection (3) (which deals with a single-enterprise agreement replacing a multi-enterprise agreement) does not apply;

then:

(d) if the earlier agreement has not passed its nominal expiry date:

(i) the later agreement cannot apply to the employee in relation to that employment until the earlier agreement passes its nominal expiry date; and

(ii) the earlier agreement ceases to apply to the employee in relation to that employment when the earlier agreement passes its nominal expiry date, and can never so apply again; or

(e) if the earlier agreement has passed its nominal expiry date—the earlier agreement ceases to apply to the employee when the later agreement comes into operation, and can never so apply again.

[34] Section 58(2)(e) of the FW Act has the same effect as 170LX(2)(b). That is, once an agreement which has passed its nominal expiry date is replaced, the old agreement ceases to operate (or, in the new parlance, the old agreement ceases to apply and can never apply again).

[35] In this case the earlier agreement (the JAM Agreement) had passed its nominal expiry date at the time the later agreement (the Zinfra Agreement) came into operation. By virtue of s.58(2)(e) the JAM Agreement ceased to apply to Mr Hardy at the time the Zinfra Agreement came into operation and can never apply again.

[36] Section 51 of the FW Act states:

51 The significance of an enterprise agreement applying to a person

(1) An enterprise agreement does not impose obligations on a person, and a person does not contravene a term of an enterprise agreement, unless the agreement applies to the person.

(2) An enterprise agreement does not give a person an entitlement unless the agreement applies to the person.

[37] Once the JAM Agreement ceased to apply to Mr Hardy any entitlements available to Mr Hardy pursuant to that agreement ceased to exist.

[38] There is nothing discernible in the FW Act that suggests any general savings provision with respect to an application made pursuant to a dispute settling procedure once the agreement that contains that procedure ceases to apply. In this respect the general limits in the FW Act have not changed from those in existence in the Workplace Relations Act 1996. As such, the principles in Stephenson remain apposite.

[39] There is no savings provision in the Zinfra Agreement such that a dispute raised under the JAM Agreement can continue to be prosecuted once the JAM Agreement ceased to apply.

[40] Absent any saving provision in the Zinfra Agreement and taking into account the limits in the FW Act, on the basis of the authority in Stephenson, the JAM Agreement cannot continue to apply to Mr Hardy such that the dispute settling procedure under the JAM agreement could be invoked with respect to matters arising under the JAM Agreement.

[41] This conclusion is further supported by the decisions of the Commission in Pulle and de Jong. No submissions to the contrary were put to me by APESMA.

Conclusion

[42] On this basis I must find that the Commission has no jurisdiction to deal with the dispute.

[43] Having reached this conclusion with respect to the first jurisdictional matter raised by Jemena there is no call to consider the further jurisdiction objection.

[44] Having reached the conclusion that jurisdiction does not exist there is nothing to warrant the consideration of the merits of the case put by APESMA. I make no finding as to those merits.

[45] I appreciate that this conclusion may not satisfy Mr Hardy. He is strongly of the view that he cannot be ‘allocated’ to Zinfra nor that he could be required to work on Zinfra assets. It seems to me that these matters flow from organisational decisions taken by Jemena a number of years ago and from the scope of the Zinfra Agreement. It was, perhaps, at the time the Zinfra Agreement was negotiated (which I understand Mr Hardy participated in) and during the approval process for that Agreement that issues associated with the scope of the Zinfra Agreement should have been, and was best, addressed. It is too late, once the Agreement has been approved, to cavil with the express scope of the Agreement.

[46] In these circumstances the application made by APESMA to have the Commission deal with a dispute pursuant to the dispute settling procedure of the JAM Agreement is dismissed.

COMMISSIONER

Appearances:

Baulch, J for the Applicant.

Follett, M of counsel for the Respondent.

Hearing details:

2013.

Melbourne;

31 July.

 1   AIRC PR952743.

 2 (2009) 190 IR 365, [14].

 3 (2010) 196 IR 145, [16].

 4   Jemena Asset Management Agreement (Vic) 2009 [2010] FWAA 214.

 5   ZNX Victorian Staff Enterprise Agreement 2012 [2013] FWCA 1103.

 6   Exhibit APESMA 2, attachment DWH1.

 7   Transcript PN576-87.

 8   Transcript PN590-2.

 9   Exhibit JAM4, paragraph 13.

 10   Exhibit JAM 4, paragraph 13.

 11   See, for example, Exhibit APESMA2, attachment DWH6.

 12   Exhibit JAM4, paragraphs 16-22.

 13   AIRC PR952743 [49].

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