Transport Workers' Union of Australia v Linfox Australia Pty Ltd

[2014] FWC 1640

[2014] FWC 1640

FAIR WORK COMMISSION

DECISION

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

Transport Workers' Union of Australia
v
Linfox Australia Pty Ltd
(C2013/3378)

SENIOR DEPUTY PRESIDENT DRAKE SYDNEY, 7 MARCH 2014

Alleged dispute about any matters arising under the enterprise agreement and the NES;[s186(6)].

[1] This dispute notification was lodged by the Transport Workers’ Union of Australia (TWU) in relation to a dispute with Linfox Australia Pty Ltd (Linfox) concerning the application of the Linfox New South Wales (Transport, Distribution Centres & Waste) Agreement 2007 (the 2007 Agreement). The dispute relates to the non payment of trip rates from August 2008 to June 2011 (the relevant period). Over all of the relevant period payment of trip rates was provided for in clause 2.2 of the 2007 Agreement and in clause 26 of the Linfox Road Transport and Distribution Centres National Enterprise Agreement 2011 (the 2011 Agreement).

[2] The Settlement of Disputes Procedure in clause 22 of the 2011 Agreement relevantly provides:

“22. SETTLEMENT OF DISPUTES PROCEDURE

22.1 Any dispute or grievance that arises at the workplace between an Employee and Linfox and/or Linfox and the TWU about the Agreement or the employment relationship (including, for the avoidance of doubt, in relation to the NES) shall be dealt with in the following manner:

.........

(d) If the matter remains in dispute, it must next be submitted to FWA for conciliation. For this purpose, it is agreed that the action FWA may take includes:

(i) arranging conferences of the parties or their representatives at which FWA is present; and

(ii) arranging for the parties or their representatives to confer among themselves as conferences at which FWA is not present.

(e) If the matter is not resolved in conciliation conducted by FWA, the parties agree that FWA may proceed to arbitrate the dispute and/or otherwise determine the rights and/or obligations of the parties to the dispute. In relation to such arbitration, the parties agree that:

(i) FWA may give all such directions and do all such things as are necessary for the just resolution of the dispute, including but not limited to those things set out in section 595 of the Act;

(ii) before making a determination FWA will give the parties an opportunity to be heard formally on the matter(s) in dispute;

(iii) in making its determination FWA will only have regard to the materials, including witness evidence, and submissions put before it at the hearing and will disregard any admissions, concessions, offers or claims made in conciliation.”

(my emphasis)

[3] I heard the parties in conference in Newcastle on 16 April 2013. Linfox agreed that it would provide written submissions and any witness statements by 1 May 2013. The TWU agreed that it would provide written submissions. There was a delay in the provision of witness statements and because of the overseas placement of Mr Bayley, a witness for Linfox. I heard the application on 12 December 2013 and 5 February 2014.

[4] The TWU notified the dispute in relation to the application of the agreements to two of its members, Mr Carlaw and Mr Horsey. Mr Horsey is no longer an employee of Linfox. During the relevant period the affected employees ceased to operate from the Linfox site in Warnervale and commenced to operate from a site in Wingham.

[5] The quantum of the trip rates is set out in a document referred to by both parties as Appendix C. Appendix C was created in 1994 following negotiations between Linfox and the TWU, and it was initially applied to a Linfox site in Somersby, New South Wales, which is 77 km north of Sydney. When the Somersby yard was closed in 2006 all of the drivers who had operated from Somersby commenced to operate from a satellite yard at Warnervale, New South Wales, which is 95 km north of Sydney. All parties agree that Appendix C continued to be applied to all of the employees who then operated out of the Warnervale site.

[6] An arrangement was subsequently entered into whereby the two affected employees worked out of Wingham, New South Wales, which is 208 km north of Sydney, and the affected employees were thereafter paid hourly rates rather than trip rates.

[7] The TWU submitted that the affected employees were entitled to trip rates from the time they commenced to work under the new arrangement at Wingham.

[8] The TWU and Linfox have held discussions since July 2011 in an attempt to resolve this issue. The TWU has issued letters of demand in relation to the amounts it alleges are owed to the relevant employees arising from the non-payment of trip rate payments during the relevant period.

[9] The TWU seeks a finding that the trip rate provisions applied to both the affected employees during the relevant period. Linfox denies that the arrangements covered the work performed by the affected employees after August 2008.

[10] Linfox raised a jurisdictional objection in relation to one of the affected employees who ceased working with Linfox around 16 December 2011. Linfox submits that the Fair Work Commission (FWC) does not have jurisdiction to deal with the dispute in relation to the former employee. The TWU argue that the dispute arose during the course of the affected employees’ working relationship with Linfox, and that there is nothing in either the 2011 Agreement or the Act that specifies that dispute resolution is only available to current employees.

[11] I do not think it is necessary to determine this issue. A finding in this application in relation to the current employee would apply to both employees if enforcement was necessary. In any event, the TWU submits that it has brought the dispute on behalf of its members, which it is entitled to do under clauses 2 and 22 of the 2011 Agreement.

[12] During the period spanning August 2008 to June 2011 the affected employees were covered by different industrial instruments. Between July 2008 and 16 May 2011 the affected employees were covered by the 2007 Agreement. Trip rates were covered by clause 2.2 of that agreement, which is set out below:

“2.2.1 Subject to approval of the appropriate Linfox manager, trip rates can be negotiated to suit the particular needs of the customers, Linfox or the task.

2.2.2 Where it is agreed that such work shall be done by employees covered by this agreement, a written schedule of work, destinations, distances and rates shall be prepared and held on file in the Linfox’s offices and such work shall apply in lieu of the Award. In respect of employees covered by this agreement such agreed trip rates shall be no less favourable than those conditions contained in this agreement.”

(my emphasis)

[13] From 17 May 2011 to date, the relevant industrial instrument was the 2011 Agreement. Trip rates are governed by clause 26, which relevantly reads:

“26.1 Subject to approval of the appropriate Linfox manager, trip rates can be negotiated to suit the particular needs of the customers, Linfox or the task.

26.2 Where it is agreed that such work shall be performed by Employees, a written schedule of work, destinations, distances and trip rates shall be prepared and held on file in the Linfox’s offices and such work and trip rates shall apply in lieu of the provisions of this Agreement (such as base rates of pay, shift penalties and overtime). The trip rates shall be no less than the amount the Employee would have received under this Agreement for the work performed.”

(my emphasis)

[14] Both parties agree that Appendix C operated under clause 2.2 of the 2007 Agreement and operates currently under clause 26 of the 2011 Agreement. Appendix C is extracted below.

“APPENDIX C

The purpose of this schedule is to set out payment for designated country trips.

LOCATION	KILOMETRES	TRIP RATE
Forster/Taree/Wingham	470	$148.00
Laurieton	628	$175.00
Port Macquarie	658	$190.00
Tamworth	694	$183.00
Gunnedah	710	$191.00
Tamworth via Gunnedah	783	$216.00
Armidale	916	$228.00
Coffs Harbour/Toormina	943	$235.00
Narromine via Mudgee	953	$273.00
Narromine	953	$238.00
Mudgee	627	$200.00

Note:

1. Unloading time of 60 minutes per store is absorbed within the trip rate - all payments in excess of one hour at store will be paid at Award rate but must be verified with Linfox office and signed off by store personnel. Additional drops will be paid at the rate of $20.00 per drop.

2. Future increases will be as per the quanta and dates set out in Clause 8 and as applicable as on and from 1 June, 1996.

3. All work performed prior to the start of a trip will be paid at Award rate.

4. All breakdown time will be paid at Award rate.

5. Late departures ie. In excess of 4.5 hours after normal start time will be granted a 10% loading.

6. All of the above trips will be entitled to a $15.00 daily meal allowance paid separately.

7. Country trips performed on weekends and public holidays will have an additional $65.00 allowance, with the exception of Forster/Taree/Wingham which will be $45.00.”

[15] The TWU submits that the trip rates in Appendix C were payable to the affected employees during the relevant period for two reasons. Firstly, Appendix C does not specify that designated country trips must start and finish at Warnervale rather, Appendix C simply outlines that a designated country trip is a journey to the destination listed. Further, the TWU submits that, even if the commencement point of the journey was material in determining what a designated country trip was, the affected drivers satisfied this requirement because they would typically drive by Warnervale on the way from Sydney to the Manning Region, change over and rest at Wingham, then return back past Warnervale.

[16] Secondly, during the relevant period, the two affected employees were still attached to the Warnervale yard for the purposes of Appendix C. In support, the TWU rely on a statement in the letter confirming the new arrangement as follows “Driver’s will remain attached to the Warnervale Site, based at Wingham”; references to “Linfox Warnervale” on payslips and Drivers Daily Worksheets; the fact that there was no Linfox office at the Wingham yard; the fact that Wingham was not listed as a site in appendix 5 of the 2011 Agreement; the fact that the manager responsible for the Warnervale site gave directions to the employees, and that representations from an officer of Linfox were made to the affected employees that Wingham was not a site, but more of a changeover point.

[17] Linfox submits that during the relevant period, the affected employees did not perform the country trips as set out in Appendix C and therefore they were not entitled to the trip rates set out in that document.

[18] Linfox submits that clause 2.2 of the 2007 Agreement and clause 26 of the 2011 Agreement state that trip rates may be negotiated to suit the particular needs of customers, Linfox or the task. Therefore, any trip rate arrangements must refer to a specific, unique set of circumstances. In 1994 the intention of the parties when negotiating Appendix C was to create trip rates for specific journeys or “designated country trips” from the Warnervale site to specific destinations. Linfox submitted that this is apparent from the drafting of Appendix C. A specific location is outlined in the location column. Each location coincides with an agreed return trip distance in kilometres and an agreed trip rate. Linfox submitted that it was intended that Appendix C operate to cover trips originating from the Warnervale site and no other. It is “geographically impossible” to conclude that Appendix C applied to the affected employees during the relevant period because the vehicle and the affected employees were based in Wingham and not Warnervale.

[19] Linfox also submitted that the affected employees were not entitled to payments under Appendix C because they were not based at and did not operate from the Warnervale site. Linfox submitted that the relevant employees were attached to the Warnervale site for administrative purposes only. Linfox denied that its officer had ever made any representations to either of the affected employees to the effect that they would be paid trip rates during the relevant period.

Conclusion

[20] I am not persuaded that the trip rates in Appendix C applied to the journeys performed by the two employees from Wingham to the various destinations to which they travelled.

[21] I am satisfied that, pursuant to both agreements, for trip rates to have applied, there had to be an arrangement which was "... Subject to approval of the appropriate Linfox manager... negotiated to suit the particular needs of customers, Linfox or the task". In addition, that arrangement had to be set out in a written schedule of work pursuant to clause 2.2.2 of the 2007 Agreement or clause 26.2 of the 2011 Agreement. These requirements did not arise accidentally. They were specifically entered into to make an arrangement by which trip rates could be established. It was a scheme intended to cover agreed arrangements. There is no contemplation of additional arrangements by which trip rates could be entered into. I am satisfied and find that a written schedule of work was required for its implementation and none existed. I am satisfied and find that, absent compliance with the scheme set out in the agreement, there could be no arrangement to pay trip rates which could be enforced against Linfox.

[22] However, for greater caution, I will deal with the suggestion, denied by Linfox, that there was an undertaking to pay trip rates to these particular TWU members.

[23] Should I have had to resolve the evidentiary conflict between the parties concerning the arrangement on the basis of the witness evidence I would have resolved it in favour of Linfox.

[24] This is for two reasons. Firstly Mr Bayley's evidence was, on balance, more consistent with the industrial arrangements in place. Secondly, the extensive period of time over which trip rates were not paid without objection by either member speaks against such an arrangement. The TWU, as the applicant, had the burden to establish the arrangement relied on, and I am not satisfied that it discharged that burden.

[25] The application is dismissed.

SENIOR DEPUTY PRESIDENT

Appearances:

G Roger for Transport Workers’ Union

D Jones for Linfox Australia Pty Ltd

Hearing details:

2013

Newcastle

April 10

Sydney

April 7 and April 12

2014

Sydney

February 5

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