Transport Workers' Union of Australia v Torrens Transit Services Pty Ltd

[2013] FWC 7318

[2013] FWC 7318

FAIR WORK COMMISSION

DECISION

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

Transport Workers' Union of Australia
v
Torrens Transit Services Pty Ltd
(C2013/5511)

TORRENS TRANSIT SERVICES PTY LTD AND TRANSPORT WORKERS’ UNION ENTERPRISE AGREEMENT 2010

(ODN AG2010/12491) (AE879603)

Passenger vehicle transport (non rail) industry
COMMISSIONER HAMPTON	ADELAIDE, 1 OCTOBER 2013

s.739 - application to deal with a dispute under the provisions of an enterprise agreement - jurisdiction - whether dispute resolution procedure applies to disputes raised by the union about the operation of the agreement - whether union has substantively complied with procedure - power derives from the procedure - necessary to comply in order for jurisdiction to be established - application not properly made.

1. Background

[1] The Transport Workers’ Union of Australia (TWU) has made an application for the Fair Work Commission to deal with a dispute concerning the application of the Torrens Transit Services Pty Ltd and Transport Workers’ Union Enterprise Agreement 2010. The application has been made under s.739 of the Fair Work Act 2009.

[2] The application was subject to an initial conference at which time the respondent employer, Torrens Transit Services Pty Ltd, advised that it did not consider the application was valid, and furthermore, it contended that there was no jurisdiction for the Commission to further deal with the application.

[3] The application was adjourned to allow the TWU to confirm its position and potentially to permit it to take whatever actions were necessary in light of the objections raised. Subsequently, the TWU has confirmed its view that the application is properly before the Commission and has contended that the dispute should now be dealt with. In light of Torrens Transit’s position, the parties have now filed written submissions and responses.

[4] Both parties have proposed that the matter could be determined without a hearing and I propose to rely upon the various written submissions now before the Commission.

2. The Enterprise Agreement

[5] The Enterprise Agreement was approved by the Commission under the Act on 30 July 2010 and its nominal life extended until 6 August 2013. The Agreement remains in force under the Act.

[6] There is no dispute that the Enterprise Agreement applies to the relevant parties. The TWU is covered by the Enterprise Agreement as contemplated by s.201(2) of the Act.

[7] The TWU contends that the dispute is about the operation of Clause 7 Hours of Employment of the Enterprise Agreement, which includes various provisions concerning shifts, hours of work and duties associated with the different shifts. This also includes the duties concerning daily shifts and sign-off for duty requirements in sub-clause 7.24 of that provision.

[8] The apparent substance of the concerns held by the TWU is that changes that were made in 2012, regarding the requirements of drivers when signing-off at the end of a shift, do not permit Torrens Transit to apply a reduced sign-off period given the terms of the Enterprise Agreement.

[9] Clause 16 Dispute Settlement Procedures of the Enterprise Agreement provides as follows:

“16. Dispute Settlement Procedures

16.1 Both the Employer and the Employees agree that as the service provided by Torrens Transit is an essential community service and that any disruption to the service could impact on the safety and security of the Employer's customers, it is not in any party's or the community's interest that there are any disruptions to the normal provision of services, despite any disagreement that may arise.

16.2 For the avoidance of doubt this procedure applies in relation to any dispute arising out of this agreement or in relation to the Standard.

16.3 In the event of a grievance or dispute arising at work an Employee shall discuss the matter with their depot Operations Manager.

16.4 In the event that the issue remains in dispute the Employee and their chosen representative will discuss the matter with the Operations Manager.

16.5 In the event that the issue continues to be in dispute the Employee may choose to refer the matter to either an organiser of the Union or to the depot Consultative Committee.

The organiser and/or a representative of the Consultative Committee will discuss the issue with the Area/General Manager.

16.6 If no negotiated settlement can be achieved and the process is exhausted without resolution, the parties shall jointly or individually refer the matter to the Fair Work Australia where the parties shall use their best endeavours to resolve the matter by conciliation.

16.7 If Fair Work Australia is unable to resolve the dispute at the first stage, Fair Work Australia may then arbitrate the dispute and make a determination that is binding on the parties. If Fair Work Australia arbitrates the dispute it must take into consideration the aims and objectives as set out in clause 16.1 as the primary consideration in making any binding determination.

Note: If Fair Work Australia arbitrates the dispute, it may use the procedural powers that are available to it under the Act.

16.8 The decision of Fair Work Australia will be binding on the parties subject to the following:

(a) There shall be a right of appeal to a Full Bench of Fair Work Australia against the decision, which must be exercised within 21 days of the decision being issued or within such other time as the Full Bench may allow.

16.9 While the above procedure is being followed work shall continue normally without interruption.”

[10] The Consultative Committee referred to in clause 16 is established by sub-clause 18.6 as follows:

“18.6 Employee Representation

(a) A Consultative Committee shall represent the Employees with representatives elected from each depot.

(b) The Employees shall elect members of the Consultative Committee for a term of two years.

(c) In the instance where the Consultative Committee meets to represent Employees its members who meet shall receive payment for one portion of their shift for that day.

... ....”

3. The steps taken by the TWU prior to making the application

[11] The TWU wrote to the General Manager of Torrens Transit on 25 and 26 July 2013, alleging that the employer had “breached” clause 7.24(e) of the Enterprise Agreement. It contended that this was based upon discussions at the Drivers Consultative Committee on 10 July 2013 and it sought that Torrens Transit remedy the issue by adhering to the terms of the Enterprise Agreement.

[12] A series of letters were then exchanged between the TWU and Torrens Transit. This included the employer referring the Union to the requirements of the dispute resolution procedure within the Enterprise Agreement and rejecting the notion that it had breached that instrument. There were also exchanges about when and in what context the parties would meet to discuss the alleged breach.

[13] The TWU lodged this application on 8 August 2013.

[14] On Friday 9 August 2013, a meeting was held between the TWU and Torrens Transit to discuss the issue. The meeting was also attended by some representatives of the consultative committee. No agreement was reached on the issue.

[15] There was debate at that time as to whether the issue had the support of the drivers given the agreed operational change in 2012. Torrens Transit reserved its rights in relation to what it described as the failure of the TWU to follow the dispute resolution procedure of the Enterprise Agreement. The TWU confirmed that the issue was whether the reduced time paid for signing-off was in breach of the Enterprise Agreement given that no formal variation of that instrument had occurred.

4. The contentions of the parties

[16] The TWU contends as follows:

● It is covered by the Enterprise Agreement and has an entitlement to take actions to enforce the agreement;
● The provisions of clause 16 of the Enterprise Agreement make explicit reference to any disputes arising out of the Agreement and the procedure contemplates disputes being referred to the Fair Work Commission;
● The threshold for a referral to the Commission is that the parties have been unable to resolve the issue, which is the case here;
● The provisions do not require that all disputes must be progressed through the procedure in clause 16 and it is silent on disputes raised by employee organisations; and in that context
● The requirement that all disputes had to be progressed through every level of that procedure would be impracticable and would deny jurisdiction to the Commission to deal with appropriate disputes.

[17] The TWU also contends that the Act, in s.739, confers power on the Commission to deal with the dispute, and the terms of the Enterprise Agreement do not require strict compliance with the procedure in relation to all disputes. In particular, a dispute taken by the Union requires only that it was raised with management, discussions took place involving it and management and/or the consultative committee, and the issue remains unresolved.

[18] As this had all occurred, the TWU contends that the Commission should now deal with the substance of the dispute.

[19] The TWU did however accept that where an employee raises a grievance or dispute, it would be necessary for the various steps in clause 16 to be followed. This, it was argued, did not extend to circumstances where the dispute was being raised by the TWU as an organisation covered by the Enterprise Agreement.

[20] Torrens Transit contends that the Commission does not have jurisdiction to deal with the application on two grounds: namely, the mandatory preconditions in clause 16 of the Enterprise Agreement have not been met; and in the alternative, any alleged dispute has (already) been resolved.

[21] In relation to the requirements of clause 16, Torrens Transit contends that:

● Sub-clauses 16.3 to 16.7 set out the procedures that must be followed for the settlement of all relevant disputes;
● The procedure requires one or more employees to discuss their grievance or dispute with their Depot Manager as a first step;
● Unless an employee does raise the dispute or grievance, the issue cannot be progressed through the balance of the procedure and the terms of the agreement do not permit a party to bypass any of the steps; and in this case
● The alleged dispute has not been raised or progressed through the necessary steps.

[22] As a result, Torrens Transit contends that s.595 and s.739 of the Act make it clear that the Commission has no power to deal with this dispute. Further, it argues that it has not waived its rights to require compliance with the agreement process.

[23] The alternative proposition advanced by Torrens Transit is that any grievance or dispute was resolved as part of an agreement made through the consultative committee process in mid August 2013 confirming that the employees did not consider that there was a dispute, and if there was, it was now resolved.

[24] I note that the TWU does not accept that the alleged agreement made in mid August 2013 was a genuine reflection of the views of the Torrens Transit employees and contends that it has the support of many employees in relation to the dispute.

[25] As will become clear, I have not found it necessary to deal with the alterative proposition advanced by Torrens Transit.

5. Is there jurisdiction for the Commission to deal with the present dispute application?

[26] In order to determine this question, it is necessary to consider the following issues.

5.1 Where does the Commission’s power to potentially deal with the application arise?

[27] An Enterprise Agreement cannot be approved without containing a term (the procedure) to deal with disputes about matters arising under the agreement and in relation to the National Employment Standards (NES). That procedure must require or allow the Fair Work Commission, or another independent body, to settle such disputes. 1

[28] Clause 16 of the Enterprise Agreement is such a provision.

[29] The functions of the Commission include dealing with disputes as referred to in s.595 of the Act. 2

[30] Section 595 provides as follows:

“595 FWC’s power to deal with disputes

(1) The FWC may deal with a dispute only if the FWC is expressly authorised to do so under or in accordance with another provision of this Act.

(2) The FWC may deal with a dispute (other than by arbitration) as it considers appropriate, including in the following ways:

(a) by mediation or conciliation;

(b) by making a recommendation or expressing an opinion.

(3) The FWC may deal with a dispute by arbitration (including by making any orders it considers appropriate) only if the FWC is expressly authorised to do so under or in accordance with another provision of this Act.

Example: Parties may consent to the FWC arbitrating a bargaining dispute (see subsection 240(4)).

(4) In dealing with a dispute, the FWC may exercise any powers it has under this Subdivision.

Example: The FWC could direct a person to attend a conference under section 592.

(5) To avoid doubt, the FWC must not exercise any of the powers referred to in subsection (2) or (3) in relation to a matter before the FWC except as authorised by this section.”

[31] Sections 738 and 739 of the Act deal with circumstances where an industrial instrument, including an enterprise agreement, contains a dispute resolution term. They provide as follows:

“738 Application of this Division

This Division applies if:

(a) a modern award includes a term that provides a procedure for dealing with disputes, including a term in accordance with section 146; or

(b) an enterprise agreement includes a term that provides a procedure for dealing with disputes, including a term referred to in subsection 186(6); or

(c) a contract of employment or other written agreement includes a term that provides a procedure for dealing with disputes between the employer and the employee, to the extent that the dispute is about any matters in relation to the National Employment Standards or a safety net contractual entitlement; or

(d) a determination under the Public Service Act 1999 includes a term that provides a procedure for dealing with disputes arising under the determination or in relation to the National Employment Standards.

739 Disputes dealt with by the FWC

(1) This section applies if a term referred to in section 738 requires or allows the FWC to deal with a dispute.

(2) The FWC must not deal with a dispute to the extent that the dispute is about whether an employer had reasonable business grounds under subsection 65(5) or 76(4), unless:

(a) the parties have agreed in a contract of employment, enterprise agreement or other written agreement to the FWC dealing with the matter; or

(b) a determination under the Public Service Act 1999 authorises the FWC to deal with the matter.

Note: This does not prevent the FWC from dealing with a dispute relating to a term of an enterprise agreement that has the same (or substantially the same) effect as subsection 65(5) or 76(4) (see also subsection 55(5)).

(3) In dealing with a dispute, the FWC must not exercise any powers limited by the term.

(4) If, in accordance with the term, the parties have agreed that the FWC may arbitrate (however described) the dispute, the FWC may do so.

Note: The FWC may also deal with a dispute by mediation or conciliation, or by making a recommendation or expressing an opinion (see subsection 595(2)).

(5) Despite subsection (4), the FWC must not make a decision that is inconsistent with this Act, or a fair work instrument that applies to the parties.

(6) The FWC may deal with a dispute only on application by a party to the dispute.”

[32] The combination of these provisions means that the Commission’s power to deal with a dispute in a matter such as this must be expressly authorised by the Act via a term of an industrial instrument giving it that function.

[33] Where the Commission is authorised to deal with a dispute through a procedure, it may, subject to the terms of the (agreement) provision, mediate, conciliate or express a view about the matter provided that it does not exercise a power that is limited by that provision. It cannot arbitrate a matter unless it is expressly empowered to do so by the terms of the provision. 3 Any decision must not be inconsistent with the Act or the relevant instrument.

[34] Any application must be made by a party to the dispute. I proceed on the basis that as the TWU is covered by Enterprise Agreement and has raised the issue, it is a party to the dispute for present purposes.

[35] There is no suggestion here that the Commission is authorised to deal with the dispute other than as a result of the existence of the Enterprise Agreement.

5.2 Does clause 16 of the Enterprise Agreement require that all disputes follow the procedure?

[36] In effect, the TWU contends that the application of clause 16 to every dispute was not intended and is not practical.

[37] The construction of the terms of the enterprise agreement should be undertaken in light of the decision of the High Court in Amcor Ltd v Construction, Forestry, Mining and Energy Union 4 as applied in Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Telstra Corporation Ltd5 and Kucks v CSR Ltd.6

[38] As a result, the approach begins with a consideration of the ordinary meaning of the words of the enterprise agreement. Further, I am obliged to take a purposive approach having regard to the whole of the particular clauses, the agreement as a whole and the context in which it was made and approved. In addition, a narrow or pedantic approach is not to be taken and the intention of the framers of the document is to be ascertained objectively.

[39] The importance of parties complying with their agreed dispute resolution procedures has been emphasised by the Commission in a number of matters. 7

[40] On its face, sub-clause 16.2 makes it clear that the procedure is to be applied to any dispute arising out of the Enterprise Agreement. The issue being raised by the TWU clearly arises out of the agreement. 8

[41] The TWU relies in part upon its status as an organisation covered by the Enterprise Agreement to support the notion that it was not intended that clause 16 be applied to every dispute. In particular, it relies upon the relevant Explanatory Memorandum in relation to s.183 of the Act.

[42] The Explanatory Memorandum states as follows:

“753. After an enterprise agreement has been made, an employee organisation that was a bargaining representative for a proposed agreement may notify FWA, in writing that it wants to be covered by the agreement. (For the rules on coverage, see clause 53.) When an employee organisation is covered by an agreement, it will have certain entitlements that it would not otherwise have. For example, an employee organisation that is covered by an agreement would be able to enforce the agreement to ensure that the employer is meeting its obligations. Furthermore, the permitted matters that may be included in an agreement include matters pertaining to the relationship between the employer or employers and the employee organisations that will be covered by the agreement.” 9

[43] This would be consistent with potentially treating the TWU as a “party” to the dispute for the purposes of s.739(6) of the Act and perhaps more broadly. However, this would not provide justification for reading the agreement provision so broadly as to put aside its actual requirements. I note also that there are a range of enforcement options 10 available to parties, including the TWU, outside of the application of the dispute settlement procedure.

[44] The Enterprise Agreement applies to the Union, by virtue of ss.51 and 183 of the Act, but the agreement is made by the employer and the defined group of its employees (see s.182). This is part of the context for the construction of the provision. 11

[45] The absence of an express capacity for the TWU to independently raise matters outside of this procedure must mean that either it is implied that the Union can act in the place of an employee, or alternatively, there is no such capacity comprehended by the provision.

[46] On the first approach, it is evident that the provision requires that relevant disputes and grievances must follow the procedure in order that the subject of the dispute may, where not resolved, ultimately be referred to the Commission. If this is not done, the potential jurisdiction and powers provided by s.739 of the Act are not engaged.

[47] If the second approach is adopted, there is no capacity for the TWU to bring this application independently of an employee raising a grievance in the workplace.

[48] Under either scenario, the dispute resolution process of clause 16 must be followed.

5.3 What are the requirements of the dispute resolution procedure in this Enterprise Agreement?

[49] I observe that unlike many dispute resolution provisions in other enterprise agreements, clause 16 of this Enterprise Agreement does not permit the various stages to be by-passed or expedited in certain circumstances.

[50] Amongst other issues, the TWU contends that a literal approach to clause 16 would require every employee with a grievance or dispute about a matter to raise it through the process. I do not consider that this follows.

[51] When a dispute has been raised in accordance with the procedure and is collective in nature, the outcomes of that dispute when determined by the Commission would be binding upon the parties to the agreement (clause 16.7).

[52] The relevant requirements of clause 16 are therefore as follows:

● Where the dispute or grievance arises from the agreement or in relation to the NES, it must be dealt with in accordance with the procedure in order to provide the basis for a potential referral to the Commission;
● The first step is for one or more employees to raise the matter with the relevant depot Operations Manager;
● Where the matter is not resolved, it is to be escalated to the (general) Operations Manager where the employee and their chosen representative will discuss the matter;
● Where still not resolved, the employee may choose to refer the matter to an Organiser of the Union or the depot Consultative Committee, who will then discuss the issue with relevant General Manager; and
● If the process has then been exhausted without a resolution, the parties may then jointly or individually refer the matter to the Commission.

[53] References in the provision to “Fair Work Australia” would all be read as meaning the Fair Work Commission.

[54] I note that an issue may arise where the other party (in this case - Torrens Transit) refuses to cooperate in the necessary steps. This would be in breach of the terms of the Enterprise Agreement and could be addressed in a number of ways but could potentially leave open the question as to how the issue can be escalated. I doubt that the procedure would be interpreted in such a manner to deny the matter being progressed. However, this is an issue that ideally would be considered when the actual term is being negotiated. Importantly, this has not occurred here and indeed Torrens Transit offered to, and did, discuss the issue despite the apparent absence of the proper process.

5.4 Has the TWU followed the disputes procedure?

[55] The TWU contends, in effect, that it has followed the substance of the procedure and that this was sufficient in this case.

[56] There is no evidence that the issue underlying the dispute was raised by or on behalf of an employee with the depot Operations Manager.

[57] The TWU directly raised the matter with the General Manager (as an alleged breach of the General Protections provisions of the Act).

[58] The subsequent dealings between the parties were then focused upon the propriety of that approach and the different views as to whether the matter said to be in dispute had been dealt with as part of the consultative committee process in 2012.

[59] The application was lodged prior to the discussions with the management of Torrens Transit.

[60] Even if I accepted that the TWU could make the initial approach to the depot Operations Manager on behalf of one or more employees, which I would be inclined to do, the required procedure within the agreement has not been followed in this case.

6. Conclusions

[61] The matter in dispute has not proceeded in accordance with the requirements of clause 16 of the Enterprise Agreement.

[62] As a result, there is presently no jurisdiction for the Commission to further deal with this application.

[63] I would however make some additional observations. Raising jurisdictional issues at the outset of Commission proceedings in these matters is not always helpful or constructive as the substance of the issues can, in many cases, ultimately be dealt with. However, the parties are subject to an agreement setting out how these matters are to be dealt with and the Act makes it clear that it is the term of the Enterprise Agreement that provides the jurisdiction and power for the Commission to intervene.

[64] A party seeking that the Commission intervene should ensure that the necessary steps have been followed before making the application. In that context, it is perhaps curious that the TWU did not take the options readily available to it earlier to neutralise the issue when it was drawn to their attention very early in the process. In light of its position that many employees support the concerns, one or more of the employees, or potentially the TWU acting on their behalf, could have raised the dispute with the relevant depot Operations Manager and taken the issue through the required process.

[65] More broadly, it appears that when negotiating agreements, parties do not as a general rule take sufficient care to ensure that their agreed dispute resolution provisions adequately allow for the different classes of disputes that may arise, or the various circumstances where the provisions may be needed. This is particularly so when provisions are modelled on terms that were made under former legislative schemes.

[66] I have, for reasons that would be clear, not dealt with the substance of the alleged dispute. There are apparently valid issues concerning the application of clause 7.24 given the changes in operational requirements at Torrens Transit. These include how the changes that have been implemented should be considered under the terms of the present Enterprise Agreement.

[67] I note that the Enterprise Agreement has passed its nominal expiry date and is apparently being renegotiated. Whatever other steps are taken, it would be prudent for clause 7.24 to be reviewed in light of recent developments and its intended operation agreed and expressly confirmed in any subsequent enterprise agreement.

Appearances:

E Lawrie of the Transport Workers’ Union of Australia.

D Ey of counsel with permission, with D Lamont for Torrens Transit Services Pty Ltd.

Conference details:

2012

Adelaide

August 29.

Final written submissions:

2012

September 16, 18, 20 and 23.

 1   S.186(6) of the Act.

 2   S.576(2)(a) of the Act.

 3   See Woolworths Ltd trading as Produce and Recycling Distribution Centre [2010] FWAFB 1464 at par [19]. See also Cape Australia Holdings Pty Ltd T/A Total Corrosion Control Pty Ltd v Construction, Forestry, Mining and Energy Union[2012] FWAFB 3994 at [15] to [24].

 4 (2005) 222 CLR 241.

 5 [2007] FCA 1515.

 6 (1996) 66 IR 182. See also City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union (2006) 153 IR 426, per French J and Cape Australia Holdings Pty Ltd T/A Total Corrosion Control Pty Ltd v Construction, Forestry, Mining and Energy Union [2012] FWAFB 3994.

 7   See for example Boral Cement Ltd v Australian Workers’ Union[2012] FWAFB 350 at [6].

 8   See Hay Point Services Pty Ltd v Construction, Forestry, Mining and Energy Union[2012] FWAFB 9173.

 9   Explanatory Memorandum to the Fair Work Bill 2008.

 10   Such as enforcement proceedings before a Court of competent jurisdiction.

 11   See Cape Australia Holdings Pty Ltd T/A Total Corrosion Control Pty Ltd v Construction, Forestry, Mining and Energy Union [2012] FWAFB 3994 at [42].

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