The Maritime Union of Australia v Skilled Group Limited T/A Ativo Maintenance & Project Services

[2015] FWC 8312

[2015] FWC 8312

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739 - Application to deal with a dispute

The Maritime Union of Australia
v
Skilled Group Limited T/A ATIVO Maintenance & Project Services
(C2015/301)

COMMISSIONER CAMBRIDGE SYDNEY, 2 DECEMBER 2015

Dispute settlement procedure - interpretation of terms of enterprise agreement and related Award - disputed terms dealing with payment of accrued personal leave when employees made redundant - further contest about redundancy payments in respect of periods of casual employment - whether terms of relevant Award and enterprise agreement obliged payment - surrounding circumstances - no ambiguity found - application granted in part - Parties to consult as to any Order.

[1] This Decision is made in respect of an application that was taken under section 739 of the Fair Work Act 2009 (the Act) for the Fair Work Commission (the Commission) to deal with a dispute in accordance with a Dispute Settlement Procedure (DSP). The application was lodged at Sydney on 13 February 2015, and it was made by the Maritime Union of Australia (the MUA), and taken against Skilled Group Limited T/A ATIVO Maintenance & Project Services (the employer).

[2] The Commission is empowered to deal with this matter by virtue of a DSP which is found at clause 13 of the Skilled Port Botany (PB) and Fisherman Islands (FIT) Patrick Site Maintenance Enterprise Agreement 2012 - 2015 (the Agreement).

[3] The dispute was unable to be resolved by conciliation and the matter has proceeded to arbitration involving a Hearing conducted in Sydney on 27 August 2015. The MUA was granted permission to be represented by Ms L Doust, a barrister. Ms Doust introduced evidence by way of an agreed statement of facts and two witness statements of Mr W J Giddins, who was called as a witness and cross-examined on the contents of his statements.

[4] The employer was granted permission to be represented by Mr I Latham, a barrister, who indicated that the employer did not seek to introduceevidence at the Hearing as its case would be advanced by way of submissions.

Background

[5] There were two questions in dispute in this instance; both issues involved a claim by the MUA that the employer had adopted an incorrect interpretation of the terms of the Agreement and the related Award which concern the amounts due as entitlements arising in circumstances of redundancy. There was very little significant factual contest about the circumstances which gave rise to the dispute.

[6] The employer relevantly provides maintenance services under contract to Patrick Stevedores at Port Botany. This work is governed by the terms of the Agreement.

[7] On 31 December 2014, the employer terminated the employment of five employees whose work was governed by the Agreement. The termination of the employment of these employees was for reason of redundancy. The five redundant employees were paid redundancy benefits in accordance with clause 15.4 of the Agreement. Each of the five redundant employees had periods of service with the employer on both a casual and weekly (permanent) basis. Further, each of the five redundant employees had accumulated personal leave entitlements of varying amounts, at the time of the termination of their employment.

[8] The employer calculated, and paid, the amounts of redundancy entitlement for each of the five redundant employees, exclusive of any payment in respect of accumulated personal leave, and by calculation of their respective periods of service as weekly (or permanent) employees and not including any casual service. The MUA has asserted that particular terms of the Agreement require payment in respect to any redundancy entitlement to include payment of accumulated personal leave, and that the period of service for the purposes of redundancy entitlement calculations should include any period or periods of casual service.

[9] The employer rejected the claims advanced by the MUA and it contended that it had calculated the redundancy entitlements for the five redundant employees in accordance with the correct interpretation of the relevant terms of the Agreement and the related Award. The contest which emerged as to whether the terms of the Agreement and the related Award required redundancy payments to include accumulated personal leave, and to be calculated to include any periods of service as a casual, was unable to be resolved. Subsequently, the MUA made the application which gave rise to these proceedings.

The MUA Case

[10] At the Hearing, Ms L Doust appeared on behalf of the MUA. Ms Doust made submissions which elaborated upon a written outline of submissions which had been filed on behalf of the MUA.

[11] Ms Doust commenced her submissions by stating that the dispute essentially involved a requirement for the Commission to determine two issues. Ms Doust said that these two issues involved aspects of entitlements which arise is circumstances of redundancy.

[12] Ms Doust said that the first question was whether a redundant employee was entitled to payment in respect of accumulated personal leave, and whether or not that entitlement was qualified by a requirement of the completion of 10 years’ service. Ms Doust stated that the second issue which required determination involved whether service as a casual employee should be included as service for the purposes of calculation of redundancy benefits.

[13] The submissions made by Ms Doust focused firstly upon clause 24.6.4 of the Agreement which dealt with the issue of payment of accumulated personal leave. Ms Doust submitted that the terms contained in clause 24.6.4 of the Agreement operated to give life to particular terms of the Stevedoring Industry Award 2010 [MA000053] (the 2010 Award). Therefore, according to Ms Doust, the terms of clause 23.2 of the 2010 Award became applicable as the basis for the entitlement to payment of accumulated personal leave in circumstance of, inter alia, redundancy.

[14] Ms Doust submitted that the proper construction of clause 23.2 (a) of the 2010 Award established that the qualification or requirement of 10 years’ service before which an entitlement to payment of accrued personal leave applied, operated as a condition to the entitlement only upon resignation. According to the submissions made by Ms Doust, there was no 10 years’ service qualification in other circumstances of termination of employment, in particular in respect to redundancy. Upon this construction of the terms of clause 23.2 (a) of the 2010 Award, Ms Doust asserted that the five redundant employees were entitled to be paid out there accumulated personal leave, irrespective of any length of service.

[15] The submissions made by Ms Doust also referred to the Full Bench Decision in the case of The Australasian Meat Industry Employees Union v Golden Cockrell Pty Limited  1 (Golden Cockerel). Ms Doust said that the Golden Cockrell Decision summarised the well-known and settled principles to guide the determination required in this matter.

[16] Ms Doust submitted that by way of application of the principles established in the Golden Cockrell Decision, the correct construction for the terms contained in clause 23.2 (a) of the 2010 Award supported the entitlement for payment of accumulated personal leave in circumstances of redundancy and without any 10 years’ service qualification. Ms Doust asserted that the proper construction of clause 23.2 (a) of the 2010 Award established that the 10 years’ service qualification was confined to circumstances where an employee resigned from their employment.

[17] Ms Doust made submissions which referred to the history of the terms contained in clause 23.2 (a) of the 2010 Award. Ms Doust traced the history of the words contained in clause 23.2 (a) of the 2010 Award, to terms contained in clause 28 (f) of the Stevedoring Industry Award 1991 (the 1991 Award). Ms Doust submitted that the terms contained in clause 28 (f) of the 1991 Award clearly established that it was only in cases of resignation that a 10 years’ service qualification operated in respect to payment of accumulated personal leave (or sick leave as it was expressed at that time).

[18] The historical analysis which formed part of the submissions made by Ms Doust, next focused upon changes to the wording of clause 28 (f) of the 1991 Award which occurred when the 1991 Award was the subject of an Award simplification review. The outcome of this Award simplification review was recorded in a Decision of Marsh SDP on 3 August 1999, and the subsequent Order made on 28 October 1999 by which the Stevedoring Industry Award 1999 (the 1999 Award) was created. Clause 23.3.6 (a) of the 1999 Award involved some reconfigured wording of the terms that were contained in clause 28 (f) of the 1991 Award. According to the submissions of Ms Doust, the reconfiguration of the wording that occurred between the 1991 Award and the 1999 Award, represented the genesis of the words which now appear in clause 23.2 (a) of the 2010 Award.

[19] Ms Doust submitted that the historical development of the words which appear in clause 23.2 (a) of the 2010 Award assisted to establish the literal construction that should be provided for those words. Ms Doust asserted that the qualification of 10 years’ service applied only to circumstances of resignation. Ms Doust stressed that resignation was a circumstance unlike the other circumstances mentioned in the clause. The distinction being that the employment was coming to an end at the election of the employee in the case of resignation, as opposed to circumstances such as death, retirement or redundancy.

[20] Ms Doust submitted that the evidence of the historical development of the words contained in clause 23.2 (a) of the 2010 Award could also be considered in the context of evidence regarding the general industry application of payment of accumulated personal (sick) leave in redundancy circumstances. Therefore, according to Ms Doust, the historical development of the particular terminology in the various Awards, and the application of that terminology, represented the surrounding circumstances which should lead to a finding that the contested terms of the 2010 Award did not contain ambiguity and should be given their ordinary meaning. Ms Doust submitted that the ordinary meaning for the words contained in clause 23.2 (a) of the 2010 Award established that the 10 years’ qualification for payment of accrued personal leave applied only to circumstances of resignation. Therefore, Ms Doust said that the clause should be interpreted to provide an entitlement to payment of accrued personal leave in redundancy circumstances without any qualification to the length of service.

[21] Ms Doust made further submissions in respect to the second question of contested interpretation of terms in the Agreement. This second contest involved the question of service for the purposes of a redundancy payment under clause 15.4 of the Agreement. Specifically, Ms Doust submitted that the term “service” should be construed to include service as a casual employee, rather than confined to service as a weekly hired (permanent) employee.

[22] Ms Doust referred to the particular words in clause 15.4 of the Agreement which included mention of “… completed year of service…” and “… any incomplete year as a weekly employee…” According to the submissions of Ms Doust, this distinction between a “year of service” and a “year as a weekly employee” supported an interpretation that the redundancy payments prescribed by clause 15.4 treated service to comprehend both service as a casual and service as a weekly employee. Therefore, Ms Doust submitted that the Agreement provided for the entitlement to redundancy payments to be calculated by reference to an employee’s entire period of service, including any period as a casual employee.

[23] Ms Doust also made submissions which were aimed at rebutting a submission made by the employer which involved the suggestion that payment of accumulated personal leave under clause 23.2 of the 2010 Award, may represent a cashing out of personal leave in breach of s. 101 of the Act. Ms Doust said that s. 101 of the Act dealt with the cashing out of personal leave when there was continuing employment, rather than in circumstances of a termination of employment, as was clearly contemplated by clause 23.2 of the 2010 Award. Therefore, according to Ms Doust, s. 101 of the Act had no application to the payment of accrued personal leave on termination as was prescribed by clause 23.2 of the 2010 Award.

[24] In summary, Ms Doust submitted that the relevant terms of the Agreement (clause 24.6.4) and those terms in the 2010 Award to which the Agreement referred (clause 23.2), provided for an interpretation which established an entitlement for payment of accrued personal leave in redundancy circumstances without any length of service qualification. Further, Ms Doust urged that the Commission find that the terms of the Agreement, clause 15.4 in particular, established that redundancy payments were to be calculated on service which included any period of service as a casual employee.

The Employer’s Case

[25] Mr I Latham, barrister, was granted permission to appear on behalf of the employer. Mr Latham referred to and relied upon written submissions which had been filed on behalf of the employer. Mr Latham made further oral submissions in elaboration of the earlier filed material and in response to the submissions made on behalf of the MUA.

[26] The submissions made by Mr Latham acknowledged that the first issue in dispute involved a contest as to whether the terms of clause 23.2 of the 2010 Award provided an entitlement for employees covered by the Agreement, and whose employment was terminated for reason of redundancy, (like the five redundant employees) to payment of accrued personal leave if they have less than 10 years’ service. Mr Latham also made submissions which addressed the second aspect of the dispute concerning whether the terms of the Agreement required that redundancy payments be calculated to include periods of service as a casual employee.

[27] Mr Latham submitted that the resolution of the two issues in contest involved a case about English words and what they mean, and how the meaning of those words is derived. Mr Latham submitted that the determination of the correct construction for the words in contest involved providing the particular text with its plain and ordinary meaning. Mr Latham stressed that the Commission should avoid any interpretation of the words in question in a manner that might achieve some sort of policy outcome that was considered desirable. Further, Mr Latham said that the particular words could not be determined by reference to what other people have construed those words to mean, nor could the words be given a meaning that led to an absurd outcome.

[28] Mr Latham made further submissions which focused upon the particular arrangement of the words contained in of clause 23.2 of the 2010 Award. Mr Latham said that the Commission should disregard evidence about the history of the development of these words and the meaning that other people may have adopted for those words. In particular, Mr Latham stressed that the Commission should not accept that what the Parties may have done since the creation of those words in the Award in the early 1990s, represented proper basis to establish the correct construction for the terms of clause 23.2 of the 2010 Award.

[29] Mr Latham made further submissions which asserted that the terms of clause 23.2 (a) of the 2010 Award were very straightforward. Mr Latham submitted that upon a very straightforward reading of these words it was clear that all of the particular circumstances that were mentioned, death, retirement, redundancy or resignation, were all caught by a qualification of 10 years’ service, before an entitlement to payment of accrued personal/carer’s leave was established.

[30] Mr Latham also submitted that the straightforward reading that he urged for the terms contained in clause 23.2 (a) of the 2010 Award, was supported by the underlying purpose for an entitlement such as sick leave. Mr Latham said that sick leave was a benefit established to protect people who were sick, and it would be contrary to the fundamental principle which underpins sick leave to provide for some windfall monetary benefit. Mr Latham submitted that the purpose of sick leave underpinned a construction which restricted access to payment of accrued sick leave. Therefore, according to the submissions of Mr Latham, it would be consistent with the purpose of sick leave to establish a 10 years’ service qualification to any payment made for accrued sick leave.

[31] Mr Latham made further submissions which strongly opposed the proposition that redundancy payment calculations, as contemplated by clause 15.4 of the Agreement, should be based on service which included periods of service as a casual employee. Mr Latham referred to s. 123 of the Act which he said made it utterly clear that casual employees are not entitled to redundancy pay, and that the 25% casual loading compensated in part, for the absence of any redundancy entitlements. Mr Latham also submitted that something of an absurd outcome would eventuate if the calculation of redundancy entitlements was taken to commence from the date of first engagement as a casual, when there may have been significant periods after that date when an individual did not perform any work.

[32] In conclusion, Mr Latham submitted that the dispute in this instance should be determined on the basis that the plain and ordinary meaning which should be attributed to the terms of clause 23.2 (a) of the 2010 Award, established that any payment for accrued personal leave was qualified by a 10 years’ service requirement. Further, Mr Latham submitted that there was no proper basis to construe the terms of clause 15.4 of the Agreement to provide for the calculation of redundancy payments to include periods of casual employment as service. Mr Latham urged the Commission to reject the interpretation of the contested terms of the 2010 Award and the Agreement, as had been advanced by the MUA.

Consideration

[33] The dispute in this instance has involved a contest regarding the correct interpretation or construction that should apply to particular terms of the Agreement and the 2010 Award.

[34] The principles that are to apply to resolving questions of contested interpretation/construction of the terms contained in an Enterprise Agreement has been the subject of an authoritative Decision of a Full Bench of this Commission in the matter of The Australasian Meat Industry Employees Union v Golden Cockrell Pty Limited  2 (Golden Cockerel). At paragraph 41 of the Golden Cockerel Decision, the Full Bench set out the following principles that apply to the approach to resolving questions of contested interpretation/construction of terms of an Enterprise Agreement:

“[41] From the foregoing, the following principles may be distilled:

1. The AI Act does not apply to the construction of an enterprise agreement made under the Act.

2. In construing an enterprise agreement it is first necessary to determine whether an agreement has a plain meaning or contains an ambiguity.

3. Regard may be had to evidence of surrounding circumstances to assist in determining whether an ambiguity exists.

4. If the agreement has a plain meaning, evidence of the surrounding circumstances will not be admitted to contradict the plain language of the agreement.

5. If the language of the agreement is ambiguous or susceptible to more than one meaning then evidence of the surrounding circumstance will be admissible to aide the interpretation of the agreement.

6. Admissible evidence of the surrounding circumstances is evidence of the objective framework of fact and will include:

(a) evidence of prior negotiations to the extent that the negotiations tend to establish objective background facts known to all parties and the subject matter of the agreement;

(b) notorious facts of which knowledge is to be presumed;

(c) evidence of matters in common contemplation and constituting a common assumption.

7. The resolution of a disputed construction of an agreement will turn on the language of the Agreement understood having regard to its context and purpose.

8. Context might appear from:

(a) the text of the agreement viewed as a whole;

(b) the disputed provision’s place and arrangement in the agreement;

(c) the legislative context under which the agreement was made and in which it operates.

9. Where the common intention of the parties is sought to be identified, regard is not to be had to the subjective intentions or expectations of the parties. A common intention is identified objectively, that is by reference to that which a reasonable person would understand by the language the parties have used to express their agreement.

10. The task of interpreting an agreement does not involve rewriting the agreement to achieve what might be regarded as a fair or just outcome. The task is always one of interpreting the agreement produced by parties.”

[35] Further, in respect to resolving matters of contested construction, the question of the conduct of the Parties in connection with the contested terms, has been examined in the following extract from the Full Bench Decision in Essential Energy v Australian Municipal, Administrative, Clerical and Services Union and Others  3 (Essential Energy):

“[23] In addition, there is one well-established further principle relevant to the interpretation of industrial instruments, including enterprise agreements, which we consider to be relevant, namely that it is not permissible to take into account the conduct of parties which occurs after an industrial instrument is made as an aid to interpret that industrial instrument.”

[36] It is also relevant to refer to the paragraphs which immediately precede the extract quoted above from the Essential Energy Decision and which includes the often cited extract from a Judgement of Madgwick J in Kucks v CSR Limited  4 (Kucks):

“But the task remains one of interpreting a document produced by another or others. A court is not free to give effect to some anteriorly derived notion of what would be fair or just, regardless of what has been written into the award. Deciding what an existing award means is a process quite different from deciding, as an arbitral body does, what might fairly be put into an award. So, for example, ordinary or well-understood words are in general to be accorded their ordinary or usual meaning.”

[37] Accordingly, the principles as established by the Full Bench Decisions in Golden Cockerel and Essential Energy have been adopted and relevantly applied in this instance to the contested construction of the terms of the Agreement and the 2010 Award. Further, the approach to the interpretation of the terms of the Agreement and the 2010 Award has been undertaken cognisant of the guidance provided by various Judgments including that in Kucks.

Clause 23.2 of the 2010 Award

[38] The first contested construction question has involved the terms contained in clause 23.2 of the 2010 Award. The terms of the 2010 Award become applicable by virtue of the operation of clause 24.6.4 of the Agreement. There was no dispute that the Commission was required to determine the correct construction of the terms of the 2010 Award in so much as, for practical purposes, these terms had been considered to have become terms of the Agreement. Relevantly, clause 24.6.4 of the Agreement states:

“24.6.4. Clause 23.2 and Clause 23.3 of the Award relating to payment of accumulated sick leave shall apply for the purposes of this Agreement in relation to an employee who seeks payment of excess personal leave. Such payment will be made at the rate referred to in Clause 16.1.3 of this Agreement. An employee who resigns/retires and/or is made redundant shall be paid at the respective salary rate as contained in the appendix(s).”

[39] Clauses 23.2 and 23.3 of the Award read as follows:

“23.2 Payment for accrued personal/carer’s leave on retirement

Where an employee:

(a) dies, retires, is made redundant or resigns their employment after 10 years’ service; or

(b) is accepted by their superannuation fund as totally or permanently disabled;

the employee (or in the case of death, the employee’s personal legal representative) will be paid an amount equivalent to the employee’s unused accumulated sick leave entitlement at the ordinary rate of pay.

23.3 Payment for excess accrued sick leave

Where an employee has accumulated as at 1 July of any year more than 28 days unused sick leave, the employee may elect to receive an amount equivalent to all or part of the accumulated sick leave in excess of 28 days at the ordinary rate of pay instead of actual leave.”

[40] The contest has focussed upon the construction that should be given to the words: “dies, retires, is made redundant or resigns their employment after 10 years’ service” appearing in paragraph (a) of clause 23.2. This sentence describes the circumstances which give rise to an entitlement for an employee to receive payment for accrued personal/carer’s leave. The Parties were in agreement that in circumstances involving the resignation of an employee, there was a requirement for that employee to have completed 10 years’ service in order to obtain the entitlement. However, the crucial point of contest was whether the 10 years’ service requirement also applied to the other circumstances which are mentioned in the sentence, namely, death, retirement or redundancy. In this case the particular circumstances involved the redundancy of the five redundant employees.

[41] The MUA has asserted that the words of the contested provisions should be given their plain meaning, having regard for evidence of surrounding circumstances, and in particular, having regard for the historical development of the words that now appear in paragraph (a) of clause 23.2 of the 2010 Award. The MUA has contended that on the basis of regard for the evidence of the surrounding circumstances, also involving what was said to be broad industry practice, the terms of paragraph (a) of clause 23.2 should be given a plain meaning which establishes that the 10 years’ service requirement was confined to circumstances of resignation of an employee. According to the MUA, the other circumstances which are mentioned in paragraph (a) of clause 23.2; death, retirement and redundancy, have no length of service requirement in order to obtain the entitlement to payment for accrued personal/carer’s leave.

[42] Alternatively, the employer has contended that the words contained in paragraph (a) of clause 23.2, cannot be given the plain meaning as was advanced by the MUA. The employer has asserted that a proper construction of the words contained in paragraph (a) of clause 23.2 of the 2010 Award provides for a plain meaning. According to the employer, that plain meaning is that the 10 years’ service requirement applies to all of the circumstances which precede the mention of that requirement in the sentence. The employer asserted that the plain meaning for the sentence as it contended for, was a matter of application of the proper grammatical construction for a sentence which did not separate the various circumstances first described, before the concluding qualification involving 10 years’ service.

[43] Consequently, the contested construction involved two competing but allegedly plain meanings that could be given to the sentence contained in paragraph (a) of clause 23.2 of the 2010 Award.

The Question of Ambiguity

[44] The approach to resolving the contested construction question should logically commence with an examination of the relevant words so as to discern whether or not these words contain some ambiguity. It is well established that the approach to resolving questions of contested construction should focus upon providing the words under examination with their plain and ordinary meaning, unless for some cogent reason such ordinary meaning is inappropriate and unavailable.

[45] Further, in order to determine whether the words contained in paragraph (a) of clause 23.2 of the 2010 Award can be given a plain meaning, principle number three from the Golden Cockrell Decision invites evidence of surrounding circumstances to assist in determining whether ambiguity exists. In this regard, it is important to examine the history of the development of the words “dies, retires, is made redundant or resigns their employment after 10 years’ service” which are found in paragraph (a) of clause 23.2 of the 2010 Award.

[46] The terms of paragraph (a) of clause 23.2 of the 2010 Award, can be relevantly traced backwards in time to predecessor terms contained in the 1991 Award. The 1991 Award contained the following terms as clause 28 (f):

“(f) Where an employee retires, is made redundant, or resigns his or her employment after 10 years’ service, or dies or leaves under circumstances where the employee has been accepted by his or her Superannuation Fund as totally and permanently disabled, the employee shall be paid (or in the case of death the legal personal representative shall be paid) the ordinary rate of pay prescribed by clause 13 of this award in respect of any balance of accumulated sick leave entitlement of which the employee had not availed himself or herself.”

[47] It is important to note the particular arrangement of the first part of the sentence in clause 28 (f) of the 1991 Award. Specifically, the circumstance involving the death of an employee was mentioned after the 10 years’ service qualification appears in the sentence. Consequently, on any construction, the terms of clause 28 (f) of the 1991 Award did not stipulate a requirement for 10 years’ service to apply in the case of the death of an employee in order to have that employee (or their “legal personal representative”) obtain the entitlement to payment in respect of accumulated sick leave, as it was then described.

[48] Further, it is relevant that the first part of the first sentence of clause 28 (f) of the 1991 Award includes a comma after the word “redundant”. The existence of this comma provides support for the proposition that the sentence was constructed in a manner which attempted to separate the various circumstances which operated to provide an entitlement to the payment of accumulated sick leave. Such a separation would seem to logically confine the 10 years’ service qualification to the circumstance of the resignation of an employee, and not operate in respect to circumstances of retirement or redundancy.

[49] In 1999, clause 28 (f) of the 1991 Award was recast as part of a review conducted under Item 51 of the Workplace Relations and Other Legislation Amendment Act 1996 (WROLA Act). The review conducted under Item 51 of the WROLA Act applied the Award Simplification Principles and consequently the 1991 Award was, in effect, subjected to an Award simplification review, and in its reviewed form, it became the 1999 Award. As part of the Award simplification review, the terms of clause 28 (f) of the 1991 Award were transformed into terms which were differently expressed as clause 23.3.6 of the 1999 Award.

[50] Clause 23.3.6 of the 1999 Award is in the following terms:

“23.3.6 Payment for accrued sick leave on retirement

Where an employee:

23.3.6(a) dies, retires, is made redundant or resigns his or her employment after 10 years service; or

23.3.6(b) is accepted by his or her superannuation fund as totally or permanently disabled;

the employee (or in the case of death, the employee’s personal legal representative) will be paid an amount equivalent to the employee’s unused accumulated sick leave entitlement at the ordinary rate of pay.”

[51] It is immediately apparent that as part of the Award simplification review process, clause 28 (f) of the 1991 Award was the subject of some reconfiguration when it became clause 23.3.6 of the 1999 Award. Significantly, the circumstance involving the death of an employee was moved from appearing in the sentence after the 10 years’ service qualification, and it was placed as the very first circumstance for which the entitlement to payment of unused accumulated sick leave would be obtained. It should also be noted that the comma that appeared after the word “redundant” in clause 28 (f) of the 1991 Award was removed from the corresponding position in clause 23.3.6 of the 1999 Award.

[52] Subsequently, the terms of clause 23.2 of the 2010 Award have repeated the reconfiguration which occurred in the transition between the relevant terms of the 1991 and 1999 Awards. The terms of clause 23.2 of the 2010 Award can be described as being materially the same as the terms of clause 23.3.6 of the 1999 Award, save for cosmetic changes in terminology such as the removal of reference to sick leave and its replacement with personal/carer’s leave.

[53] The examination of the history of the development of the words which now appear in clause 23.2 of the 2010 Award assists in resolving the competing propositions for the construction that should be provided for these terms. It was uncontested that because of the positioning of the words in clause 28 (f) of the 1991 Award which dealt with the circumstance of the death of an employee, the 10 years’ service qualification did not apply in respect to death. However, because of the repositioning of the words that deal with the circumstance of death which first changed in clause 23.3.6 of the 1999 Award, and which have continued in clause 23.2 of the 2010 Award, it was asserted that the construction that should be given to these terms would mean that the 10 years’ service qualification would apply in respect to death.

[54] Consequently, the particular configuration of the words as they now appear in clause 23.2 (a) of the 2010 Award, has evolved as an imperfect attempt to describe the particular circumstances which have historically provided an entitlement for an employee to be paid accrued personal/carer’s leave when their employment is terminated. These circumstances have logically made a distinction between the termination of employment at the will of the employee, as opposed to termination of employment imposed against the will of the employee. Unfortunately, none of the incarnations of the relevant terms in any of the 1991, 1999 or 2010 Awards have expressed the particular circumstances that provide for an entitlement to the payment of accrued personal/carer’s leave in a manner which is unequivocal, such that it could not be open to argument.

[55] Despite the imprecision with the terms that have appeared in the various Awards, the repositioning of the words in respect to the circumstance involving the death of an employee was clearly not intended to introduce the 10 years’ service qualification to any of the other circumstances that the clauses were attempting to describe. Consequently, an examination of the surrounding circumstances involving the historical development of the contested terms of the 2010 Award, has provided for the identification of a plain and unambiguous meaning for these terms.

[56] Therefore, each of the particular circumstances which give rise to the entitlement to payment of accrued personal/carer’s leave should be construed separately. The correct construction for the words contained in clause 23.2 (a) of the 2010 Award establish that in any of the following circumstances, an entitlement to payment for accrued personal/carer’s leave arises: death; retirement; redundancy; resignation after 10 years’ service. The 10 years’ service requirement is confined to circumstances of resignation.

Clause 15.4 of the Agreement

[57] There was further contest about the construction that should be provided for the terms of clause 15.4 of the Agreement. Clause 15.4 of the Agreement is in the following terms:

“15.4. Redundancy payments shall be calculated on the basis of three weeks pay for each completed year of service and pro-rata for any incomplete year as a weekly employee at the weekly salary rate to a maximum payment, including notice of termination payments, not exceeding the equivalent of forty weeks at the salary rate.”

[58] The MUA asserted that the terms of clause 15.4 of the Agreement established a distinction which applied to pro rata payments for incomplete years of service as a weekly employee. The distinction that was said to arise involved an inference that completed years of service would not be confined to service as a weekly employee, and would thus incorporate periods of service as a casual employee. The result of such a construction for these terms would mean that redundancy payments would be paid in respect of periods of employment as a casual employee.

[59] The proposition that redundancy payments would apply in respect to periods of employment as a casual is counterintuitive, and it is contrary to other unambiguous terms which are contained in the Agreement. Further, the construction for the terms of clause 15.4 of the Agreement as was urged by the MUA would provide potential for an absurd outcome.

[60] Perhaps little more needs to be said about this issue of contest, other than to refer to the following provisions of clause 10.3 of the Agreement:

“Casual employees are not subject to any redundancy arrangements or severance.”

“Casual employees shall be given or shall give, as the case may be, one hour's notice of termination of employment. No other termination payments will be made except for the notice period of one hour referred to herein.”

“Clauses in this Agreement and in the Award relating to overtime, annual leave, sick leave, public holidays, compassionate leave, parental leave, long service leave and jury service do not apply to casual employees.” [emphasis added]

[61] In addition, if clause 15.4 of the Agreement was to have application in the manner proposed by the MUA, it is conceivable that in the case of a weekly employee who had previous periods of service as a casual, and the date of the first engagement as a casual became the basis for calculating completed years of service, that period could encompass significant periods when that employee was not engaged by the employer at all, and perhaps working elsewhere. It would be absurd to make redundancy payments in respect of a period or periods, when there was no employment relationship in existence between the Parties and perhaps, instead, employment with a different employer.

Conclusion

[62] The determination of the dispute in this instance has involved a requirement to settle contested construction questions arising from particular terms contained in the Agreement and the 2010 Award. The first contest has focussed upon the terms of clause 23.2 of the 2010 Award, and has involved competing propositions as to whether the words: “Where an employee: dies, retires, is made redundant or resigns their employment after 10 years’ service” provide an entitlement for payment of accrued personal leave which in each circumstance of; death, retirement, redundancy or resignation, is qualified by a requirement to have attained 10 years’ service or, in the alternative, confines the 10 years’ service requirement to only the circumstance of resignation.

[63] The competing propositions for construction of the terms of clause 23.2 of the 2010 Award have been evaluated and balanced. The contested terms of the 2010 Award have been examined having regard for evidence of surrounding circumstances so as to determine whether an ambiguity exists. In particular, the historical developments of the terms of the 2010 Award have been carefully examined. The historical position has established a contextual framework which has assisted in providing foundation for the correct construction of these terms.

[64] Upon analysis, and application of the principles for resolution of questions of contested construction as primarily established by the Golden Cockerel Decision, I have concluded that the disputed terms of the 2010 Award should be given a plain and ordinary meaning as was contended for by the MUA.

[65] The correct construction of clause 23.2 of the 2010 Award results in an entitlement for an employee to receive payment of accrued personal/carer’s leave when their employment is terminated in the circumstances of: (a) death; or (b) retirement; or (c) redundancy; or (d) resignation, provided that in the case of resignation only, the employee must have completed at least 10 years’ service. The 10 years’ service requirement does not apply to the circumstances of death, or retirement, or redundancy.

[66] The second contested construction question has involved clause 15.4 of the Agreement, and the proposition advanced by the MUA that redundancy payments should be made in respect to periods of employment as a casual. This proposition is rejected and the employer’s construction for the terms of clause 15.4 of the Agreement is confirmed.

[67] As a consequence of the conclusions that have been reached, the Commission determines that the application made by the MUA in respect to the combined operation of clause 24.6.4 of the Agreement and clause 23.2 of the 2010 Award, is granted. The application as it was made in respect to clause 15.4 of the Agreement is refused.

[68] In view of the determinations made as to the correct construction and interpretation that should be given to the contested terms of the Agreement and the 2010 Award, it may be unnecessary to formulate any Orders to supplement this Decision.

[69] The Parties are required to consult in respect to any requirement for an Order to be issued to reflect the determination of the dispute and advise the Commission accordingly within 21 days from the date of this Decision.

COMMISSIONER

Appearances:

Ms L Doust of Counsel, with Mr A Jacka, appeared for The Maritime Union of Australia.

Mr I Latham of Counsel appeared for Skilled Group Limited T/A ATIVO Maintenance & Project Services.

Hearing details:

2015.

Sydney:

August, 27.

 1   The Australasian Meat Industry Employees Union v Golden Cockrell Pty Limited [2014] FWCFB 7447.

 2   The Australasian Meat Industry Employees Union v Golden Cockrell Pty Limited [2014] FWCFB 7447.

 3   Essential Energy v Australian Municipal, Administrative, Clerical and Services Union; Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia; The Association of Professional Engineers, Scientists and Managers, Australia [2015] FWCFB 1981.

 4 Kucks v CSR Limited [1996] IRCA 166 (19 April 1996), 66IR182.

Printed by authority of the Commonwealth Government Printer

<Price code C, PR574595>