United Firefighters' Union of Australia v Metropolitan Fire and Emergency Services Board
[2013] FWCFB 2301
•3 MAY 2013
[2013] FWCFB 2301 |
FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.604—Appeal of decision
v
Metropolitan Fire and Emergency Services Board
(C2013/3173)
Metropolitan Fire and Emergency Services Board
v
United Firefighters’ Union of Australia
(C2013/3204)
VICE PRESIDENT HATCHER | SYDNEY, 3 MAY 2013 |
Appeal against order [PR533599] of Commissioner Roe at Melbourne on 29 January 2013 in matter numbers C2011/5138 and C2011/5139. Appeal against decisions [2012] FWA 5408, [2012] FWA 9352 and [2013] FWC 354 of Commissioner Roe at Melbourne on 13 July 2012, 5 December 2012 and 17 January 2013 in matter numbers C2011/5138 and C2011/5139.
Background
[1] The proceedings the subject of these appeals arose out of two applications under s.739 of the Fair Work Act 2009 (the Act) filed by the United Firefighters’ Union of Australia (UFU) on 19 July 2011. The applications invoked the dispute resolution procedure contained in clause 19 of the Metropolitan Fire and Emergency Services Board, United Firefighters’ Union of Australia Operational Staff Agreement 2010 (the Agreement). The Agreement was approved under the Act on 23 September 2010, and applies to the Metropolitan Fire and Emergency Services Board (MFB) and its operational workforce. The UFU’s applications identified a range of matters as being in dispute, including the number of firefighter instructors, facilities for training and instructors, qualification levels of instructors, consultation and the ability of instructors to access leave.
[2] The applications were allocated to Commissioner Roe. The Commissioner initially attempted to resolve the disputes the subject of the applications by way of a number of conciliation conferences, and additionally conducted an inspection of the MFB’s training facility at Burnley. A substantial number of the issues in dispute were resolved by way of recommendations issued by the Commissioner. However, there remained outstanding an issue concerning the capacity of the MFB to attract operational firefighter staff to work as instructors at its Burnley training facility, and to retain them in such work. This attraction and retention problem was said to be caused by the fact that operational firefighters ordinarily undertake shift work and consequently receive additional remuneration by way of shift penalties, whereas the training positions at Burnley were day work positions which did not attract any such penalties.
[3] In this context, clause 72 of the Agreement was identified as being critical to the resolution of this outstanding issue, since it contemplated the creation of a progression stream for instructors. Clause 72 provides:
“72. STREAMING
72.1. The parties agree to develop an Instructor/Community Safety stream within the first 6 months of the Agreement. Any such stream shall not result in a reduction or change to the career paths and classifications within this agreement, and will be subject to agreement between the parties. To avoid any doubt, this means that the new stream shall potentially have a title of Instructor/Community Safety Officer or Senior Instructor/Senior Community Safety Officer, but be equivalent in the remuneration and conditions of classifications within this agreement.
72.2. Any employee who undertakes a role within the new stream as instructor or community safety officer shall be paid at a rate of no less than :
72.2.1. Station Officer; or
72.2.2. the equivalent to their substantive classification; for the duration of their secondment/streaming position as an instructor or community safety officer.”
[4] On 4 August 2012, the Commissioner issued a recommendation which, relevantly, stated:
“Further to the Recommendation of 25 July 2011, the following Recommendation was made by Fair Work Australia and is accepted by the parties as a resolution to the disputes subject to the outstanding matter concerning the Assistant Chief Fire Officers being resolved.....
9. The issue of instructor progression will be directly discussed between the parties with a view to resolution within one month. If resolution is not achieved within that time frame it will be resolved through the disputes settlement process at Fair Work Australia.”
[5] It is not in dispute that the reference contained in this recommendation to the “disputes settlement process at Fair Work Australia” was to be understood as a reference to the disputes settlement procedure contained in clause 19 of the Agreement (and was in fact understood by the MFB and the UFU in this way). Clause 19 of the Agreement provides:
“19. DISPUTE RESOLUTION
19.1. This dispute resolution process applies to all matters arising under this agreement, which the parties have agreed includes:
19.1.1. all matters for which express provision is made in this agreement; and
19.1.2. all matters pertaining to the employment relationship, whether or not express provision for any such matter is made in this agreement; and
19.1.3. all matters pertaining to the relationship between the MFESB and UFU, whether or not express provision for any such matter is made in this agreement.
The parties agree that disputes about any such matters shall be dealt with by using the provisions in this clause.
19.2. To ensure effective consultation between the employer, its employee(s) and the union on all matters, the following procedure shall be followed in an effort to achieve a satisfactory resolution of any dispute or grievance:
19.2.1. Step 1 The dispute shall be submitted by the union and/or employee(s) to the employee’s immediate supervisor.
19.2.2. Step 2 If not settled at Step 1, the matter shall be submitted to the appropriate senior officer.
19.2.3. Step 3 If not settled at Step 2, the matter shall be recorded. The matter shall be submitted to the appropriate delegated Industrial Representative of the employer for consultation.
19.2.4. Steps 1 - 3 Must be concluded within a period of ten (10) consecutive days. Disputes are to be resolved at a local level wherever possible.
19.2.5. Step 4 If the matter is not settled at Step 3, the dispute shall be formally submitted in writing to the Manager Employee Relations, setting out details of the dispute and, where appropriate, with supporting documentation. The Manager Employee Relations shall convene a meeting of the employer, employee(s) and the union within a period of one week (7 days) of receipt of such submissions and endeavour to reach a satisfactory settlement.
19.2.6. Step 5 If the matter is not settled following progression through the disputes procedure it may be referred by the union or the employer to FWA. FWA may utilise all its powers in conciliation and arbitration to settle the dispute.
19.3. Notwithstanding the words contained in the above sub-clause, the steps of the procedure apply equally to a dispute raised by an employee, the union or Officer in Charge
19.4. While the above procedures are being followed, including the resolution of any dispute by FWA pursuant to clause 19.2.6, work must continue and the status quo must apply in accordance with the existing situation or practice that existed immediately prior to the subject matter of the grievance or dispute occurring. No party shall be prejudiced as to the final settlement by the continuance of work in accordance with this sub-clause.
19.5. This clause shall not apply to a dispute on a Health and Safety issue.
19.6. A dispute may be submitted, notified or referred under this clause by the UFU.
19.7. A decision of FWA under this clause may be appealed. A dispute is not resolved until any such appeal is determined.”
[6] After further discussions between the parties failed to result in an agreement concerning the establishment of an instructors’ progression scheme, the Commissioner made a further recommendation on 14 November 2011 which stated:
“Point 9 of the Recommendation of 4 August 2011 which was accepted by the parties provided that “The issue of instructor progression will be directly discussed between the parties with a view to resolution within one month. If resolution is not achieved within that time frame it will be resolved through the disputes settlement process at Fair Work Australia.”
The parties agree that there has been a mutual commitment to resolve the matter of instructor progression consistent with Clause 72 of the Agreement. The matter has not progressed within the timetable agreed. The following timetable will now be followed to produce a resolution to the matter.
- The parties will meet directly on 18 November and again in the week beginning 28 November 2011.
- The UFU will provide to Fair Work Australia and to the MFB a statement of its claim in respect to the resolution of this matter by 30 November 2011.
- There will be a conciliation conference at 2.30 pm on Friday December 2
- If the matter is not resolved the UFU will produce any material it wishes to rely on in arbitration including outline of submissions and any witness statements and evidence by 13 December 2011.
- The MFB will produce any material in reply by 23 December 2011
- The UFU will produce any material in response by 16 January 2011.
- The matter will be heard at 9.30am on Friday 20 January 2011 (noting that the Commissioner is not available for January 17 to 19).”
[7] The UFU subsequently advanced a proposal for an instructors’ progression stream prior to the conference between the parties on 2 December 2011 which had been contemplated by the Commissioner’s 14 November 2011 recommendation. At the conference on 2 December 2011, a further recommendation was made by the Commissioner which embodied an agreement between the MFB and the UFU:
“The following Recommendation was agreed to by the parties.
1. The Metropolitan Fire and Emergency Services Board (the MFB) shall provide a written proposal concerning instructor progression based upon the County Fire Authority (the CFA) approach including any proposed impact on allowances by 9 December 2011.
2. The United Firefighters’ Union of Australia (the UFU) shall consider the proposal and consult its executive and respond on 12 December 2011.
3. A further conference shall be held on 14 December 2011 at 10 am. In the event that the matter is not resolved on 14 December 2011 the arbitration schedule set out in the Recommendation of 16 November 2011 shall be reprogrammed at that conference.”
[8] In accordance with the above recommendation, the MFB advanced its initial proposal for instructor progression. After a further conference on 14 December 2011, the Commissioner issued directions for the arbitration of the issue of instructor progression which included a timetable for the filing of evidence and submissions and the setting of hearing dates (on 20 and 21 March 2012). As the Commissioner recorded in making his directions, the programming of the matter for arbitration was agreed between the parties at the conference on 14 November 2012.
[9] After the UFU had filed and served its material as required by the above directions, the MFB, by way of correspondence sent to the Commissioner on 15 March 2012, indicated for the first time that it had a jurisdictional objection to the conduct of the arbitration (although the nature of the jurisdictional objection foreshadowed at this time was considerably different to the jurisdictional objection ultimately pressed by the MFB). There followed a controversy between the parties as to the procedural course which ought be taken in the light of the MFB’s new position on jurisdiction. It is not necessary for present purposes to trace the twists and turns of that controversy which was the subject of considerable debate at hearings on 20 March 2012 and 13 June 2012. It is sufficient to say that the approach ultimately taken by the Commissioner was to hear the MFB’s jurisdictional objection and then proceed straight to hearing the parties on the merits (including receiving their witness evidence) in a hearing which commenced on 13 June 2012 and continued on 27 June 2012 and 11 July 2012.
[10] The submissions on jurisdiction made by the MFB on 13 June 2012 canvassed, essentially, two propositions in support of the contention that the Commissioner had no capacity to arbitrate the issue of an instructors’ progression stream, namely that:
(1) Clause 72 of the Agreement, which contemplated the development of such a stream, was merely “aspirational” in nature and created no enforceable legal obligation, and also ceased to have any effect after six months from the commencement in effect of the Agreement. The dispute resolution powers in clause 19 could not operate with respect to a clause which had no ongoing effect.
(2) The power to arbitrate conferred by clause 19 was excluded by reason of the requirement in clause 72.1 that the development of the instructor/community safety stream be “subject to agreement between the parties”.
[11] The MFB also submitted, in the alternative, that if there was power to arbitrate under clause 19, that power was constrained by clause 72 in two ways: firstly, that both an instructor and community safety stream had to be established, not just an instructor stream, and, secondly, that any remuneration and conditions for classifications in the established scheme had to be equivalent to conditions and classifications prescribed elsewhere in the Agreement.
[12] On 13 July 2012, the Commissioner issued a detailed and comprehensive decision 1 (First Decision) in which he rejected the primary submissions of the MFB on jurisdiction, rejected the first alternative submission of the MFB earlier referred to, and in respect of the MFB’s second alternative submission, concluded that clause 72 did require that remuneration levels in the stream to be established be the same as those applicable to classification levels in the Agreement, but with the proviso that employees in the stream would have the opportunity to be paid at higher classification levels if they met “relevant criteria in the specialist area”. The Commissioner went on in the First Decision to determine that a stream for instructors should be established, to identify principles to apply to the instructors stream so established, and to set out the basic model for the stream. He indicated an intention to issue a further decision when the requirements for appointment and progression within the instructor stream were established, made directions for the parties to confer on that issue, and reserved a date for a hearing on that issue should the parties be unable to reach agreement about it.
[13] The parties did not reach an agreement, and a further hearing ultimately occurred on 9 October 2012. On 5 December 2012, the Commissioner issued a further decision 2 (Second Decision) in which he determined the requirements for appointment and progression with respect to each classification in the new stream, and additionally determined transitional arrangements to apply to existing officers within MFB’s training department. He directed the MFB to prepare a draft order giving effect to his determinations, gave the UFU an opportunity to respond, and foreshadowed that he would conduct a further conference or hearing to resolve any differences as to the form of the final order to be made.
[14] There was a further hearing concerning the form of the final order conducted by the Commissioner on 16 January 2013. On 17 January 2013, the Commissioner issued a further short decision 3 (Third Decision) in which he resolved some outstanding issues concerning the form of the order to be made. On 29 January 2013, the Commissioner issued the final order4 (the Order) implementing the instructor stream.
The Appeals
[15] The UFU has appealed against the Order, and the First, Second and Third Decisions. Its Notice of Appeal dated 18 February 2013 contains a single ground, which may be characterised as raising a merits issue. The MFB has also appealed against the Order on a number of grounds. Its Notice of Appeal dated 19 February 2013 identifies eleven grounds of appeal. Grounds 1-4 and 11 raise issues of the jurisdiction and power of the Commissioner to make the Order. Grounds 5-10 raise a number of merits issues. Except as to one discrete matter identified later, each party resisted the other’s appeal.
Permission to Appeal
[16] Both parties have proceeded on the basis that permission to appeal is required under s.604 of the Act. Insofar as the Commissioner had jurisdiction under clause 19 of the Agreement to arbitrate in the proceedings (a contested issue with which we deal later), it might have been argued that permission to appeal was not required because clause 19.7, by providing that “A decision of FWA under this clause may be appealed”, conferred upon the parties an unqualified right of appeal. 5 However, that submission was not put, and we will proceed on the basis that each appeal requires a grant of permission under s.604.
[17] We have decided to grant permission to appeal with respect to both appeals. The subject matter of the Commissioner’s decisions and Order is of public importance, given that it concerns the jurisdiction of the Commission to arbitrate disputes under a dispute resolution procedure in an enterprise agreement, the manner in which powers conferred by such a dispute resolution procedure are to be exercised, and the training of firefighters who provide a public good. Further, the MFB’s appeal challenges the entire validity of the Order, and at least some of the grounds for that challenge appear to be reasonably arguable. We are satisfied therefore that the grant of permission to appeal in each case is in the public interest.
[18] We propose to deal with the MFB appeal first, because of the number and complexity of the issues which it raises. We will then deal with the UFU appeal.
The MFB Appeal - Jurisdictional Issues
[19] Where an enterprise agreement includes a term that provides a procedure for dealing with disputes, s.739 of the Act confers upon the Fair Work Commission jurisdiction to deal with the dispute in accordance with that term. In this connection, subsections (3), (4) and (5) are of particular relevance:
“(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.
(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.”
[20] The MFB submitted that the Commissioner had no jurisdiction, or alternatively, no power to make the Order based on various limitations or restrictions it identified in the terms of the Agreement. Five grounds were advanced in support of that submission. Those grounds were identified in paragraph 13 of the MFB’s written submissions on its appeal, which is extracted for convenience below:
“13. MFB submits that the exercise of the power under clause 19.1.1 is subject to any limitations contained in clause 72 and must be consistent with the FW Act. As such, the power under clause 19.1.1 is subject to the following:
(i) clause 72 imposes no enforceable obligation upon the MFB and UFU to develop an Instructor stream within the first 6 months of the Agreement;
(ii) alternatively, if clause 72 does create an enforceable obligation it lapsed on 23 March 2011 being 6 months from the date of approval of the Agreement;
(iii) any obligation to develop an Instructor stream was subject to the agreement of the parties as to the title, remuneration, and conditions of classification applicable within the Instructor stream;
(iv) the exercise of the power under clause 19.1.1 cannot:
(a) vary the terms of the Agreement in a manner inconsistent with Division 7 of Part 2 - 4 FW Act;
(b) have the effect that contrary to the statutory scheme regulating approval of enterprise agreements in Division 4 of Part 2 – 4 of the Act, the Agreement as approved on 23 September 2010, did not contain all of the terms to have effect as an enterprise agreement as at the date of approval;
(v) clause 19.1.1 cannot be a vehicle for a work value claim contrary to the express prohibition in clause 70.6.
[21] It may be doubted whether each of these grounds is in truth a challenge to both jurisdiction and power. In the context of the proceedings before the Commissioner, “jurisdiction” may relevantly be characterised as the authority of the Commissioner under clause 19 of the Agreement to arbitrate upon the issue of the instructor stream, while “power” concerned the nature of the determination or order which the Agreement permitted to be made as an outcome of any such arbitration. 6 The MFB’s grounds (i) to (iii) appear to challenge the jurisdiction of the Commissioner to embark upon any arbitration about the instructor stream at all, whereas grounds (iv) and (v) do not appear in themselves to deny the jurisdiction of the Commissioner to arbitrate upon that issue, but challenge the power of the Commissioner to make the particular order which he did.
[22] The MFB’s grounds (i) and (ii) proceed on the premise that it was necessary, in order for the Commissioner to be authorised to conduct an arbitration under clause 19.1.1 of the Agreement concerning the subject matter of clause 72, that clause 72 give rise to an “enforceable obligation”. Thus, the MFB submitted, because clause 72 was merely, “an agreement to agree”, and had no effect after six months, there could be no arbitration concerning it under clause 19.1.1.
[23] We reject the premise of the MFB argument so identified. Clause 19.1.1 applies the dispute resolution process to “all matters for which express provision is made in this agreement”. As a matter of ordinary language, the development of an instructors’ stream was a matter for which there was an express provision in clause 72 of the Agreement. This remained the case regardless of whether clause 72 gave rise to an enforceable obligation or not, and regardless of whether it had work to do after the first six months of the term of the Agreement or not. Enterprise agreements approved under the Act often contain provisions which may not give rise in themselves to substantive enforceable obligations, such as general statements of intent or policy, agreements to review matters, machinery provisions and so forth. As long as such provisions are “permitted matters” under s.172 - for example, because they are “about” matters pertaining to the relationship between the employer and the employees - then this does not affect their status as legitimate provisions of an enterprise agreement (provided they do not offend any other relevant provision of the statutory scheme, such as the prohibition on unlawful terms in s.186(4)). There is therefore no basis to disregard clause 72 as an express provision of the Agreement for the purpose of clause 19.1.1 based on a characterisation of its legal enforceability.
[24] There are some earlier decisions in which the capacity of the Commission, or its predecessors, to arbitrate a dispute about particular matter under the dispute resolution of an agreement was considered in the light of whether the matter was the subject of a legally enforceable obligation in that agreement. An example of such decisions is Australian Municipal, Administrative, Clerical and Services Union v Australian Taxation Office 7. However, such cases must be understood in the context of the particular terms of the dispute resolution procedure of the agreement in question, as well as the statutory context applying to that agreement. In the example referred to, the dispute procedure operated, relevantly, where the question was one of “whether or not a person bound by this Agreement has complied with any procedural obligation, employee entitlement or condition under the Agreement”8. That being the source of power, it was necessary to examine whether the provision about which non-compliance was complained of was a provision which established an obligation, entitlement or condition. But no such limiting words are contained in clause 19.1.1.
[25] Additionally, and in any event, clause 19.1.2 of the Agreement extends the application of the dispute resolution procedure to “all matters pertaining to the employment relationship, whether or not provision for any such matter is made in this agreement”. The MFB did not dispute that the establishment of an instructors’ stream was a matter pertaining to the employment relationship. However, the MFB submitted that arbitration of the instructors’ stream was not permissible under this provision because of the “no extra claims” provision in clause 23. Clause 23 of the Agreement provides:
“23.1. There shall be no extra claims by either party.”
[26] We do not accept this submission. Clause 72 contemplates that the parties would at least endeavour to establish an instructors’ stream. For the clause to be effective in respect of that contemplated endeavour, the parties must by necessary implication have been able to advance proposals concerning the instructors’ stream. For that reason, a proposal of that nature cannot properly be characterised as an “extra claim” for the purpose of clause 23, because it is not “extra” in the sense of being additional to the matters already provided for by the Agreement. For the same reason, to the extent that the Commissioner in his decisions and Order acted upon the proposals advanced by the UFU and the MFB in the arbitration, he cannot be said to have done anything contrary to clause 23 of the Agreement.
[27] We therefore reject grounds (i) and (ii) of the MFB’s jurisdictional objections.
[28] MFB’s ground (iii) proceeds on the basis that the words “Any such stream ... will be subject to agreement between the parties” in clause 72.1 operate to prevent the introduction of a non-consensual instructors’ stream by way of an arbitration hearing conducted under clause 19. Implicit in this submission is the contention that the general conferral of jurisdiction to arbitrate disputes in clause 19 of the Agreement is to be construed as being confined by the specific requirement for agreement in relation to an instructors’ stream in clause 72.1. Seen this way, the argument is analogous to the following principle of statutory interpretation enunciated in Anthony Hordern and Sons Ltd v The Amalgamated Clothing and Allied Trades Union of Australia 9:
“When the Legislature explicitly gives a power by a particular provision which prescribes the mode in which it shall be exercised and the conditions and restrictions which must be observed, it excludes the operation of general expressions in the same instrument which might otherwise have been relied upon for the same power.”
[29] The UFU in its submissions accepted that there was an overriding requirement for agreement in relation to the instructors’ stream. We accept the submission jointly advanced by the parties in this respect. The position here seems to us to be the same as that considered by the Full Bench in Sydney Ferries Corporation v Australian Maritime Officers’ Association 10. In that case, the workplace agreement under consideration included a dispute settlement procedure (clause 4.3) which provided for the mediation, conciliation and, if necessary, arbitration of disputes in relation to matters arising under the agreement. The workplace agreement also included a separate provision concerning rostering which referred to any changes to rosters being by agreement. The question which the Full Bench had to determine was whether, in the absence of agreement, any dispute concerning changes to rosters could be the subject of arbitration at the initiation of one party. The Full Bench held that it could not, stating:
“[20] While cl.4.3 confers a power of arbitration, the agreement must be interpreted as a whole. The power to arbitrate conferred in general terms by cl.4.3 must be interpreted in light of the specific provisions dealing with rosters. There are a number of indications in the roster provisions that the parties did not intend that the Commission could exercise a power of arbitration if they failed to reach agreement on new rosters. First, there is no provision expressly giving the Commission the power of arbitrating new rosters. Secondly, the Agreement provides for the manner in which new rosters will be reached – by agreement between the parties. Thirdly, as the Commissioner pointed out, the Agreement provides a dispute resolution role for the Commission in relation to the implementation or proposed implementation of new rosters, by implication excluding the Commission from the role of arbitrating the rosters themselves. These specific indications of the parties’ intention lead us to conclude that, determined objectively, the parties did not intend the power of arbitration conferred on the Commission by cl.4.3 to extend to arbitrating the new rosters if they were not agreed.”
[30] In the First Decision, the Commissioner accepted that the conduct of any process of dispute resolution concerning the instructors’ stream had to be subject to the provisions of clause 72, including the requirement for agreement. However, the Commissioner determined that no inconsistency arose between the notion of conducting an arbitration under clause 19 and the requirement for agreement in clause 72 because of the fact that the MFB and the UFU had agreed that there should be an arbitration on the issue of the establishment of an instructors’ stream. The Commissioner reasoned as follows:
“[58] I accept that the second sentence of Clause 72 that “any such stream shall ... be subject to agreement between the parties” means that FWA can arbitrate a dispute where the parties fail to agree on the details of the stream and where the parties agree that the matter or part of the matter should be resolved by utilising Clause 19. In such circumstances the stream is subject to agreement between the parties, that is, an agreement that FWA should determine the outstanding issues between the parties. This is consistent with the “subject to agreement” requirement in Clause 72. The determination of FWA would then constitute the agreement between the parties.
[59] The history of this matter which I have set out in detail in the first part of the decision puts beyond doubt that a dispute which was in part about instructor progression was subject to the steps required in Clause 19 disputes settlement procedure to allow the matter to be dealt with by conciliation. In conciliation part of the resolution of the dispute was that the parties and FWA agreed that “the issue of instructor progression ... will be resolved through the disputes settlement process at Fair Work Australia”.
[60] The issue of instructor progression if resolved will establish an instructor/community safety stream if the MFB preferred solution is adopted. It will establish an instructor stream if the UFU preferred solution is adopted. In March 2012 the parties agreed that the matter of instructor progression should be arbitrated and they also agreed that in doing so it would be consistent with Clause 72. Therefore I am satisfied that the requirement that “any such stream shall ... be subject to agreement between the parties” has been satisfied by the agreement of the parties to have the matter of instructor progression arbitrated. In this context an agreement to arbitrate utilising Clause 19 satisfies the requirement in Clause 72.”
[31] The MFB criticised the Commissioner’s reasoning above on the basis that it was inconsistent with the plain meaning of the words “subject to agreement between the parties” in clause 72, and that the Order was plainly not an agreement between the parties. The MFB further submitted that if it was intended in clause 72 that the parties could agree to have the matter of streaming arbitrated, there would have been express language to this effect. In support of this submission, the MFB contrasted clause 72 with clause 97.1 of the Agreement, which provides:
“97.1. Commander Reliever Allowance
The parties agree to review conditions of designated Commander Relievers in the first 12 months of this agreement. Any outcomes from such review will be discussed between the parties and subject to dispute resolution if no agreement is reached.”
[32] We reject the MFB’s submission in this respect. The words “subject to agreement between the parties” are broad in scope and contain no restriction upon the nature of the agreement which the parties may choose to reach between themselves (provided that the other conditions expressly stated in clause 72 are complied with). What the parties have done in agreeing to arbitration by the Commissioner may properly be characterised as an agreement that the instructors’ stream to be implemented by the parties would be that which would be determined as an outcome of an arbitration conducted under clause 19. There is nothing in the language of clause 72 which suggests that an agreement of this nature is not a relevant “agreement between the parties”. In the general law, a contract which leaves certain terms, even essential terms, to be determined by a third person constitutes an effective and enforceable agreement. 11 Under the Act, the terms of an enterprise agreement being negotiated may be resolved by a process of arbitration conducted by consent of the bargaining representatives under s.240(4).12 Bearing these concepts in mind, it could not be said that in using the words “agreement between the parties” in clause 72, the parties did not intend or contemplate that that might include an agreement to an outcome determined by a consent arbitration.
[33] The MFB’s submission based on clause 97.1 does not dictate a different conclusion. The reference in that provision to the utilisation of dispute resolution if agreement was not reached about a certain identified matter does not provide any proper basis to read down the plain words of clause 72.1. We conclude that the Commissioner’s reasoning in the First Decision was correct, and we reject the MFB’s ground (iii).
[34] Ground (iv) may be dealt with briefly. The MFB’s submission was that the Order “effects a substantive variation to the Agreement other than in accordance with Division 7 of Part 2-4 of the FW Act”. 13 We reject this. A determination that results from a private arbitration conducted pursuant to the dispute resolution procedure in an enterprise agreement does not operate to vary an enterprise agreement in any sense. Such a determination is not enforceable as if it were itself a term of the enterprise agreement; it is binding by force of the agreement of the parties to accept it as such.14 The terms of the enterprise agreement remain in effect and enforceable pursuant to the compliance and enforcement scheme prescribed in Chapter 4 of the Act, notwithstanding the determination of the private arbitration. Section 739(5) operates to prevent any inconsistency between any such determination and the enterprise agreement from which it arose. In circumstances where the Act authorises parties to enter into enterprise agreements which may confer on the Fair Work Commission wide powers of private arbitration, including the power to arbitrate upon a dispute about any matter pertaining to the employment relationship15, it is obvious that such arbitral determinations may potentially impose new obligations on the parties which are not inconsistent with the terms of the enterprise agreement.16 It simply does not follow, however, that by doing so, the enterprise agreement has been varied. Ground (iv) is rejected.
[35] For similar reasons we reject the MFB’s further submission that a consequence of a construction of clause 72 which permitted the Commissioner to conduct an arbitration concerning the instructors’ stream meant that the Agreement did not contain all the terms which were to have effect as at the date of its approval, contrary to the statutory scheme for approval of enterprise agreements in Division 4 of Part 2-4 of the Act. A determination which results from a private arbitration conducted pursuant to a dispute resolution procedure in an enterprise agreement does not create any new terms of that agreement.
[36] In its submissions in support of ground (v) of its jurisdictional objection, the MFB, by way of a detailed analysis in its written submissions 17, characterised the UFU proposal for an instructors’ stream advanced in its case before the Commissioner as “a work value claim contrary to clause 70.6 of the Agreement”. Clause 70.6 provides:
“70.6. The parties acknowledge the UFUs right to pursue a work value / anomaly type exercise within the 2005 MFB UFU Operational Staff Agreement. However in light of the parties agreeing on the new relativities referred to in clause 70.5 the UFU agrees to defer any work value claim until the nominal expiry date of this agreement.”
[37] The MFB submissions went on to contend that the Commissioner erred in taking into account, as he apparently did at paragraph [131] of the First Decision, work value changes as established by the evidence, because this was inconsistent with clause 70.6 of the Agreement and thus not permitted by s.739(5) of the Act.
[38] Whether or not the UFU’s proposal for an instructors’ stream can be characterised as a work value claim advanced contrary to clause 70.6 seems to us to be beside the point. What the Commissioner ultimately did (by way of the Order) bore little resemblance to the UFU proposal, such that he cannot be said to have acceded to the UFU’s claim, however it be characterised. The real question must be whether the Order was inconsistent with clause 70.6 and was therefore made contrary to s.739(5).
[39] We do not think there was any such inconsistency. It is clear that the Commissioner, in all three decisions, was concerned with establishing an instructors’ stream that accorded with the requirements of clause 72 of the Agreement, as the parties had asked him to do. It is equally clear that the Commissioner had regard, amongst a range of matters, to the work value of instructors, as at least paragraphs [130] and [131] of the First Decision disclose. However, this can hardly be said to have been a consideration extraneous to the establishment of an instructors’ stream pursuant to clause 72. Because it was determined by the Commissioner that particular instructor roles should have pay parity with particular ranks, regardless of the substantive rank of the person carrying out the role - in accordance with the MFB proposal and over the opposition of the UFU - then work value was of obvious relevance in determining which role should have pay parity with which rank. Indeed, to establish a new instructors’ stream based on the identified attraction and retention problems alone, without regard to work value, would have been contrary to long-established principles of industrial arbitration. 18 In that context, the proposition that what the Commissioner was doing was doing was granting a work value claim as such contrary to clause 74.1 must be rejected.
[40] Accordingly we reject the MFB’s challenges to the jurisdiction and power of the Commissioner to make the Order.
The MFB Appeal - Merits Issues
[41] The MFB raised, in substance, four merits issues in its appeal (encompassing grounds 5-10 in its Notice of Appeal). We propose to deal with those issues in the order in which they appear in the MFB’s written submissions.
[42] First, the MFB contended that there was “insufficient evidence” to support the conclusion that it was necessary to increase the salaries of instructors in order to achieve the objective of attracting operational staff to the Burnley training facility and retaining them in positions at that facility. Its submission in this regard focused on one aspect of a finding made by the Commissioner in the First Decision that “there are some difficulties associated with the attraction and retention of instructors” 19. The MFB acknowledged that there was at least some evidence of an attraction and retention problem. This evidence went to the rate of turnover of instructor staff at Burnley and difficulty which the MFB had in filling its quota of 49 instructor positions through the course of the year. However, the MFB also pointed to evidence which it contended diminished the extent of any attraction and retention problem, including evidence which it said demonstrated that most instructors complete their two year term at Burnley, and that the MFB’s current promotion program was successfully attracting operational staff to work at Burnley.
[43] The full finding made by the Commissioner identifying the existence of an attraction and retention problem at Burnley was expressed in the following terms:
“[132] I also accept that there are some difficulties associated with the attraction and retention of instructors. The fact that the instructors are well motivated and dedicated does not detract from this point. The evidence supports the conclusion that a number of instructors have left the role despite their commitment to the work for financial reasons and because of the pressures associated with the work as an instructor. There is uncontested evidence that new more intensive measures are being utilised to attract further instructors. At various times the department has operated with less than the desirable number of instructors.”
[44] The UFU pointed to evidence which supported the particular factual matters identified in the Commissioner’s finding. For example, the UFU referred to the following evidence of Bruce Simpson:
“By June 2011, I was no longer able to justify the personal, professional and financial sacrifices required in being an instructor and I decided to return to operational firefighting.” 20
[45] The UFU further referred to the evidence of Tony Martin. At paragraph 4 of his witness statement, Mr Martin stated as follows:
“About five years ago, I went back to working as an operational firefighter for 5-6 months. I had become tired of the workload and the hours spent working outside the classroom in preparing training materials, assessing participants and reviewing courses. Whilst I am genuinely committed to training and thoroughly enjoy working as an instructor, our work is becoming increasingly onerous. In July 2011, the strain of being over worked and under resourced took its toll and I was forced to take 3 weeks sick leave through Workcover.” 21
[46] The UFU also referred to the oral evidence of Brian Whittaker during cross-examination on 27 June 2012:
“No?---We'd like to think we had 49 staff constantly throughout a year. We struggle to fill these positions. For whatever reason people aren't attracted to it, but we're running a promotion program now that is attracting people to training.
It is? All right. So you've had some recent ?---Applications.
- - - applications. You've filled how many positions recently?---Probably about six.
So what level have those people come in at?---Station officer and senior station officer.
All right. When you talk about you'd like to have 49 - sorry. You've recently had some courses and you've currently got courses running and you're running with a complement of about 43 instructors?---Correct.
You say you've been able to deliver the course with that number of instructors. Ideally you would like to have another half dozen or so?---Yes, and that's what we're aiming at.
You are in the midst of a promotional - promoting at the moment, recruitment?---Yes.
You are getting - you have had a favourable response to that initially?---Yes, we have. Not enough, but they still come through.
They're coming through? Can you just give the Commissioner a sense as to how many have come through?---Look, we're probably sitting on two at the moment, but we're still, as I say, probably four to six down.” 22
[47] We are satisfied that the Commissioner’s finding concerning the existence of an attraction and retention problem was reasonably open to him, having regard to the evidence such as that referred to above. Indeed, as the UFU submitted, that at least an attraction if not a retention problem of some degree existed was not in contest, nor was it in contest that some form of salary enhancement, whether immediately upon appointment at Burnley or through subsequent progression, was necessary to address that problem. The MFB’s own proposal, as summarised in the First Decision, 23 involved existing instructors holding the rank of Leading Firefighter being paid as Station Officers, and also gave instructors further opportunities to move to higher pay grades subject to meeting identified criteria and there being vacant positions to move to. When the MFB’s proposal was initially sent to the Commissioner, it was in the form of a letter from Mr Rau, the MFB’s Executive Director, which included the following statement24:
“As you are aware the matter of instructor progression was first raised in conciliation by the MFB during proceedings in relation to the Burnley training facilities dispute. Specifically, the MFB highlighted the difficulty of attracting sufficient numbers of qualified trainers to the Burnley training facility. This resulted in the parties agreeing to meet and consult on the streaming reserved matter within the operational staff agreement as a potential way of addressing the matter.”
[48] Mr Wright also gave evidence that the MFB’s proposal would “result in better attraction and improved retention in non-operational roles”. Thus the MFB itself identified before the Commissioner the existence of an attraction and retention problem requiring address. Accordingly, we reject the MFB’s first merit argument.
[49] The second argument was that the Commissioner erred in making the instructors’ progression scheme, the subject of the Order, applicable to existing employees in the training department as at 1 January 2013. The MFB contended that a potential result of the Order would be to entrench existing instructors in their positions at Burnley and thus diminish the capacity of the MFB’s Chief Officer to move operational shift workers into streamed day work training positions in the future. It also argued that there was:
“... no evidence ... to support the conclusion that the mutual intention of the MFB and the UFU when negotiating cl.72 was that the Instructor Stream could be the vehicle for an across the board appointment and reclassification of firefighters currently employed in the Training Department.” 25
[50] Both parties in the proceeding below adduced witness evidence as to their respective subjective intentions in the negotiation of clause 72 of the Agreement. It is apparent that the parties had widely differing perspectives as to how the general concept of an instructors’ stream could actually be realised. This is demonstrated by the evidence of Mr Wright, relied upon by the MFB, that streaming was intended to deal with a limited set of circumstances that would result in no more than 15% of the current training workforce being allocated as streamed positions. 26
[51] Mr Wright’s evidence in this respect cannot be used in aid of the interpretation of clause 72 of the Agreement, even presuming that the clause can be regarded as ambiguous. The principles concerning the use of extrinsic materials to resolve ambiguity in contracts stated in Codelfa Construction Pty Ltd v State Rail Authority (NSW) 27 have been applied to the interpretation of collective industrial agreements.28 Those principles allow regard to be had to the objective background of facts applying at the time the agreement was negotiated, including evidence of prior negotiations so far as they tend to establish objective background facts known to both parties and the subject matter of the contract, notorious facts the knowledge of which can be presumed, and evidence of matters in common contemplation and constituting a common assumption.29 But “[w]hat cannot be taken into account is evidence of statements and actions of the parties which are reflective of their actual intentions and expectations”.30 Mr Wright’s evidence falls into this latter category.
[52] The text of clause 72 itself discloses no limitation of the type referred to by Mr Wright and relied upon by the MFB. The reference in clause 72 to the development of an instructors’ stream clearly allows for the possibility of such a stream applying to all instructors, present and future. The Commissioner’s Order is entirely consistent with the clause in this respect.
[53] As to the submission that the Order would entrench existing instructors in their positions, that can only be regarded as speculative. The evidence of Mr Wright relied upon by the MFB in support of this submission 31 concerned the UFU proposal, not the Order, and is therefore of little assistance. In any event, as the UFU pointed out in its submissions32, only 14 of the existing 65 instructors received an immediate pay increase under the Order, which makes it unlikely that there is potential for “entrenchment” of the current workforce at Burnley. It was open for the Commissioner to determine that the new instructors’ stream should apply to all instructors at Burnley, present and future, and we can discern no error in this respect.
[54] The MFB’s third argument was that the Commissioner erred in determining, as part of the transitional arrangements in the Order, that existing instructors who, as at 1 January 2013, have held the rank of Station Officer for five or more years and have served as instructors in the training program for five or more years, shall, subject to the satisfaction of certain conditions concerning a recognition of prior learning assessment and completion of such further educational requirements as may be necessary, be advanced to the streamed position of Senior Instructor and be paid at the level of a Senior Station Officer. The MFB submitted, without contradiction from the UFU, that there were ten officers who would benefit from this transitional arrangement and who would receive an annual pay increase in the order of $7000 as a result. The error the MFB identifies is that the automatic progression benefit conferred by this aspect of the transitional arrangement does not extend to any current Instructors who have not yet reached the prescribed five year period of service at rank and experience but will do so in the future (of which there are 33 33). This, the MFB submitted, was highly anomalous, because it would lead to a situation whereby, at some future point, there would be persons of the same rank of Station Officer, all performing the same work, and all meeting the prescription of five years’ service at rank and experience as well as the same educational criteria, who are paid substantially different rates of pay. The MFB submitted that the decisions provided no explanation for this.
[55] The UFU did not attempt to defend this aspect of the Order. Rather, the UFU accepted that this amounted to an error on the part of the Commissioner, and submitted that the anomaly was the result of an unintended “slip” by the Commissioner.
[56] Somewhat unusually therefore we are left with the position where both parties contend that the Commissioner erred in the relevant respect. Be that as it may, we need to be satisfied ourselves that the Commissioner erred in the way identified by the parties.
[57] We accept that that the transitional arrangement for Station Officers is likely to lead to arbitrary differentials in pay for persons meeting the same criteria in terms of role, rank, service and education, in the way explained by the MFB. Further, we cannot identify in any of the decisions any relevant rationale for this outcome. The Commissioner’s reasons for, in effect, “deeming” Station Officers with five or more years experience in training to be Senior Instructors is contained in paragraphs [64] and [65] of the Second Decision as follows:
“[64] I observe that the MFB changed their position somewhat during the process of the case. The MFB earlier envisaged that existing employees in the training department would have some opportunity of overtime to acquire the necessary skills and qualifications to advance within the stream, however, their position at the hearing was to only allow access to streamed positions where and when a vacancy in a separate streamed position occurred. In their proposed draft Order and submission of 26 November 2012 the MFB proposed that Station Officers who have 5 or more years of experience in the training department would be given priority for senior instructor vacancies which may arise in the next six months. The MFB proposed that these “employee’s experience and prior learning would be assessed (either internally or externally by an accredited organisation as determined by the MFESB) to be equivalent to the core units of the Diploma of Training Design and Development or equivalent.”
[65] Having considered the content of the core units of the Diploma and the evidence of those who work in the training department about the duties that they perform I consider that the MFB is correct that those Station Officers who have 5 or more years of experience in the training department would be likely to be assessed as achieving the equivalent of the core units of the Diploma. It is possible that there may be some gaps for some individuals but given the employees’ experience these could be readily filled within a defined period. I am satisfied that it would be reasonable to deem that the existing Station Officers who have 5 or more years experience meet the requirements for the senior instructor level in the stream.”
[58] That paragraph does not reveal any basis for distinguishing between Station Officers who reach their five years’ service as at 1 January 2013 and those who do so at a later date. There is nothing in the Second Decision that takes the matter any further until one sees, at paragraph [73] subparagraph (10), the Commissioner’s statement of his conclusion concerning the transitional arrangement for Station Officers with five years’ service at rank and experience. The Commissioner does not appear, therefore, to have considered the anomalous and arbitrary consequences which are likely to flow from the transitional arrangement which he constructed for Station Officers. This amounts to an error in the exercise of the Commissioner’s discretion, in that he failed to take into account a material consideration.
[59] The parties were, not surprisingly, at odds as to what should be done about the error. The MFB submitted that this was a fundamental flaw in the Order, requiring it to be quashed. The MFB did concede however that it was open to the Full Bench to then remit the matter to the Commissioner. The UFU submitted that the matter was capable of correction by way of a variation to the Order extending the “deeming” provision for Station Officers to those who reach five years’ service at rank and experience after 1 January 2013. However, as the MFB pointed out, this would necessarily have cost consequences for it, in circumstances where the Commissioner in a general way clearly took “budgetary constraints and limitations” into account in a significant way. 34
[60] In respect to the error we have identified, we are currently minded to remit the matter to Commissioner Roe to the extent necessary to re-hear this aspect of the matter. However, we propose to give the opportunity to the parties to make short further submissions on the course that should be taken in the light of these reasons for decision. Our orders will reflect this.
[61] The MFB had a further sub-argument that the transitional arrangement deeming Station Officers with five years’ service at rank and experience to be Senior Instructors was also flawed because it did not require them to complete the core units of the Diploma of Training Design and Development or the Diploma of Vocational Education and Training, which at paragraphs [30] and [32] of the Second Decision the Commissioner found were appropriate qualifications for appointment as a Senior Instructor. However, we think that the Commissioner’s reasoning in paragraphs [64] and [65] of the Second Decision, which we set out earlier, satisfactorily explains the rationale for this. The MFB did not identify any error in that reasoning. This submission is rejected.
[62] The fourth error contended for by the MFB was that the Order exempted Senior Station Officers from the diploma requirements for the position of Senior Instructor, and also exempted Commanders from the diploma requirements for the position of Manager, Learning and Development. This was said to be erroneous because the Commissioner had earlier, at paragraphs [28], [30] and [32] of the Second Decision, found that those diploma requirements, which had been advanced by the MFB, were appropriate for the positions in question. There was, submitted the MFB, no subsequent reasoning to be found in the Second Decision or the Third Decision explaining why the Order departed from this finding.
[63] In reply, the UFU submitted that it was open to the Commissioner to include the identified exemptions in the order, but it was unable to identify any part of the Second or Third Decisions which set out the rationale for the exemptions.
[64] The issue of these exemptions did arise in the proceedings in a limited way after the Second Decision had been issued but before the Third Decision. At paragraph [74] of the Second Decision, the Commission set out in tabular form his conclusions as to requirements for appointment and progression for each of the stream roles he proposed to establish. In respect of the roles of Senior Instructor and Manager, Learning and Development, the table clearly identifies the diploma exemptions for Senior Station Officers and Commanders respectively. The Commissioner then concluded the Second Decision with a direction to the MFB to prepare an order reflecting his decision, and further gave the UFU an opportunity to reply to that draft order.
[65] The MFB prepared a draft order in response to that direction. That draft order did not contain the diploma exemptions. The UFU then responded by modifying the MFB draft in a “track changes” format, which showed that it put the diploma exemptions into the draft consistent with paragraph [74] of the Second Decision. There was then, as earlier explained, a further short hearing on 16 January 2013. The transcript does not disclose any real debate about the issue; indeed, arguably, it shows that the MFB accepted that the UFU draft order accurately reflected what the Commissioner had decided at paragraph [74] subparagraph (1) of the Second Decision. 35 The fact that the MFB subsequently filed a further draft order which contained the diploma exemptions for Senior Station Officers and Commanders is consistent with this. The Third Decision makes no reference to the issue.
[66] We are left therefore in the position where the basis for a significant aspect of the educational qualifications set out in the Order is not explained in any of the decisions the subject of the MFB’s appeal. The diploma exemptions cannot be explained by reference to some concept of recognition of prior learning, since that is separately provided for in the Order. They are inconsistent with the evidentiary findings made by the Commissioner in the Second Decision identified in the MFB’s submissions concerning what were the appropriate educational qualifications for the positions of Senior Instructor and Manager, Learning and Development. The only evidence which the UFU identified as supporting this aspect of the Order was in the statement of evidence of Mr Kenneth Edwards as follows:
“In my view, where a person holds both the relevant Vocational Competencies and a relevant education or training qualification, such as a Certificate IV or a Diploma, that individual should be adequately equipped with the requisite skills to train and assess without supervision. That person would not, in my view, require supervision to deliver and assess a unit of study.” 36
That evidence does not, in our view, go to that aspect of the Order concerning diploma exemptions for Senior Station Officers and Commanders.
[67] We accept therefore the MFB’s submission that this aspect of the Order was erroneous. We propose to take the same approach with respect to this error as identified in paragraph 60 above.
The UFU Appeal
[68] In its written submissions in support of its appeal, the UFU contended that the Commissioner had erred in the exercise of his discretion in the making of the order, firstly, by failing to take into account evidence adduced by the UFU that the titles and roles held by instructors in the MFB’s training department at Burnley were “inextricably linked” to particular ranks as specified by the Agreement and, secondly, by failing to properly interpret and apply clause 74 of the Agreement such as to give effect to what was said to be the parties’ intention to preserve the integrity of the rank and file promotional structure for firefighters under the Agreement. The UFU characterised these as errors in discretionary decision-making of the type identified in House v The King 37- in the first case, a failure to take into account a material consideration, and in the second case, acting upon a wrong principle.
[69] We shall deal with each of these alleged errors in turn.
[70] As to the first, the UFU pointed to evidence which it adduced following the Commissioner’s statement in the First Decision 38 that he lacked sufficient evidence about the current organisation of work at the training department:
“[139] I was not satisfied that there was sufficient evidence before me as to how work is currently organised in the training department. Do all firefighters at a particular substantive rank in the training department engaged in training delivery currently do the same work? Does the same apply to those engaged in training development? Do all of those who are engaged at a higher substantive rank direct the training work of those at a lower rank? Do some firefighters have specialist or more responsible roles due to their qualifications and or length and depth of experience in training? There was insufficient evidence before me of what changes, if any, to the current way in which the training department operates would flow from the introduction of a particular streaming proposal. There was insufficient evidence of what changes were a necessary consequence of the introduction of a particular streaming proposal?”
[71] The evidence relied upon by the UFU, drawn from the witness statements of Brendan Angwin, Mark Lyons, Tony Martin and Greg Whatley, in general described the way in which particular roles at the training department were currently carried out by persons of particular rank. However, with the possible exception of Mr Martin, the evidence referred to by the UFU does not express any apprehension about the consequences for the rank structure if the MFB proposal for an instructors’ stream was to be adopted. 39
[72] The fact that the Commissioner in the First Decision identified the need for evidence concerning the existing arrangements as to work roles at Burnley and their relationship to the rank structure demonstrates that he understood the significance of these matters. Likewise, evidence as to these matters having been adduced by the UFU, it is apparent that the Commissioner took this evidence into account in the Second Decision. The Commissioner expressly recorded that he had considered it, 40 referred to the UFU witnesses as “experts” concerning their knowledge of the existing arrangements,41 and, critically, reasoned from that evidence to conclude that the development of specialised training roles for Burnley would not undermine the existing classification structure:
“[14] The evidence demonstrates that a number of informal or internal titles are attributed to roles within the training department. For example, there are six Senior Station Officers working at the Burnley College who have a role as Training Coordinators. The Commanders at the Burnley College also have particular training management role titles allocated to them. The use of these titles with their accompanying educational and educational development roles does not undermine the integrity of the classification and promotional structure. The expansion of educational development roles and expertise in this respect is no different from the introduction of other new firefighting skills and equipment and the requirement to deal with new situations, hazards and protocols.” 42
[73] As the UFU developed its submissions in oral argument, it became apparent that the UFU’s complaint was not in truth that the Commissioner had failed to take this evidence into account - indeed, counsel for the UFU conceded, properly, that the Commissioner had taken the evidence into account - but rather that the Commissioner had failed to treat that evidence as determinative of the outcome.
[74] As developed in this way, the UFU’s first ground of appeal cannot succeed. The essence of a discretionary decision-making process is that no one consideration and no combination of considerations is necessarily determinative of the result and that the decision-maker is allowed latitude as to the choice of the decision to be made. 43 Here, the Commissioner was asked by the parties to develop an instructors’ progression stream for the Burnley training facility by way of the conduct of a dispute resolution process. Subject only to any relevant requirements or conditions stated in the Agreement itself, it was open to the Commissioner to establish an instructors’ stream which did not strictly adhere to a rigid relationship between rank and role. That the Commissioner did not treat the UFU’s evidence earlier referred to as requiring the result urged upon him by the UFU does not amount to appealable error.
[75] Indeed, it may be observed that it is doubtful that the UFU’s evidence in this regard provided much support for the outcome for which it contended in any event. Most of that evidence, as earlier stated, was merely descriptive of the status quo. It did not provide any real basis for the conclusion that there should be no change to the existing arrangements, and indeed it is difficult to envisage how the Commissioner could have performed the task of determining an instructors’ progression stream without making some form of change to those arrangements.
[76] The UFU’s second argument turns upon clause 74 of the Agreement. Clause 74 provides:
“74. MAINTENANCE OF CLASSIFICATIONS
74.1. In addition to the protections provided in Part A, it is the intention of the parties to preserve the integrity of the rank and promotional structure for firefighters.
74.2. Work currently performed by employees in the classifications in this agreement, including that of training facilities, will continue to be performed by employees in these classifications who are directly employed by the MFESB. Such employees will be employed under:
74.2.1. the Classifications referred to in this agreement, and/or
74.2.2. Position Descriptions agreed by the parties.
74.3. Work now or in the future able to be performed by employee(s) in 74.2.1 to 74.2.2 above will be performed by employee(s) engaged in classification(s) in 74.2.1 to 74.2.2 above and directly employed by the MFESB.
74.4. Further it is agreed between the parties that this agreement is intended to cover all activities of the MFESB within the scope of clause 74.2 or within the scope of work that is performed by employees, or capable of being performed by employees within the occupations specified in this agreement.
74.5. Should there be any consideration for any of the activities of the MFESB or any activities usually or capable of being carried out by the MFESB to be delegated or assigned to, or to be provided by, another party, other than the MFESB, then the MFESB will consult with the UFU to reach agreement on the arrangements for and the manner in which the activity shall by carried out prior to implementation of any proposal or change.”
[77] The UFU’s submission focused upon the reference in clause 74.1 to the intention to preserve the integrity of the rank and promotional structure, and the reference in clause 74.2 to the requirement for work, including work at training facilities, to be continued to be performed by MFB employees in the classifications in the Agreement and/or agreed position descriptions.
[78] Read as a whole, we think it is doubtful that clause 74 had any substantial relevance to the task undertaken by the Commissioner. The actual obligations it imposes (as distinct from the mere statement of the parties’ intention in clause 74.1) are concerned with the prevention or prohibition of the outsourcing of any work functions currently performed by MFB employees under the Agreement. Nothing done by the Commissioner in the Order was inconsistent with these provisions.
[79] It was submitted by the UFU that, by establishing roles in the instructors’ stream which were not rigidly tied to rank, the Commissioner acted inconsistently with clause 74.2 by allowing employees to be classified other than under the classifications in the Agreement. We reject this submission. The classification structure in the Agreement is contained in clause 69. Clause 69 does no more than identify classification titles, the basic appointment criteria for each classification, and the rank attaching to each classification. Clause 69 does not identify that any particular types or categories of work are to be performed by any particular classifications or ranks. The Commissioner clearly identified in the Order that persons undertaking any role in the instructors’ stream would retain their substantive classification and rank. This was stated as one of the underlying principles upon which the Commissioner proceeded in the First Decision: “Employees will retain their substantive operational classification and will return to that classification if they cease working within the stream and returned to operational duties” 44. The UFU’s submission that clause 74 of the Agreement “requires not only that firefighters hold a substantive rank but also that the roles they perform and the responsibilities they hold are determined by that rank”45 is simply not supported by the text of the Agreement.
[80] The UFU’s appeal must therefore be dismissed.
Conclusion
[81] We direct and order as follows:
(1) Permission to appeal is granted to the MFB and the UFU.
(2) Grounds 8 and 9 of the MFB’s appeal are upheld. The MFB appeal is otherwise dismissed.
(3) The UFU appeal is dismissed.
(4) The parties are directed, within 14 days of the date of this decision, to file and serve a short submission setting out what further orders they propose that the Full Bench should make, having regard to the above reasons for decision, and the reasons why those proposed orders should be made.
VICE PRESIDENT
Appearances:
M. McDonald SC with C. Symons of counsel for the Metropolitan Fire and Emergency Services Board
A. Forsyth of counsel with T. Sakkas for the United Firefighters’ Union of Australia
Hearing details:
2013.
Melbourne.
17 April.
1 United Firefighters’ Union of Australia v Metropolitan Fire and Emergency Services Board [2012] FWA 5408
2 United Firefighters’ Union of Australia v Metropolitan Fire and Emergency Services Board [2012] FWA 9352
3 United Firefighters’ Union of Australia v Metropolitan Fire and Emergency Services Board [2013] FWC 354
4 PR533599
5 See University of Western Sydney v Prof Richard Fletcher [2009] AIRCFB 368 at [6]-[8]; Dr F Tiver v University of South Australia [2010] FWAFB 3544 AT [5]; Australian Manufacturing Workers’ Union v Silcar Pty Ltd [2011] FWAFB 2555 at [15]-[28]
6 See Harris v Caladine [1991] HCA 9; (1991) 172 CLR 84 at [136].
7 (2005) 144 IR 85
8 See [6] and [15]-[17]
9 (1932) 47 CLR 1
10 [2007] AIRCFB 909
11 Godecke v Kirwan (1973) 129 CLR 629 at 645 per Gibbs J; Booker Industries Pty Ltd v Wilson Parking (Qld) Pty Ltd (1982) 149 CLR 600 at 609 per Brennan J
12 See for example Boral Resources (NSW) Pty Ltd v Transport Workers’ Union of Australia [2010] FWAFB 8437 at [2]-[5] and [30]
13 MFB written submissions at paragraph 27
14 Construction, Forestry, Mining and Energy Union v Australian Industrial Relations Commission (2000) 203 CLR 645at 658[31]-[34]; Australian Municipal, Administrative, Clerical and Services Union v Australian Taxation Office (2003) 121 IR 333 at [10]
15 Boral Resources (NSW) Pty Ltd v Transport Workers’ Union of Australia [2010] FWAFB 8437 at [2]-[19].
16 See Metropolitan Fire and Emergency Services Board v United Firefighters’ Union of Australia, Victorian Branch[2012] FWAFB 9555 at [23]: “Albeit this might have the effect that the settlement of pertaining disputes results in the creation of new rights and obligations, as is the case here, that is a result of the parties specifically agreeing that disputes that extend beyond matters dealt with by the Agreement are amenable to resolution under the dispute settlement procedure in the Agreement.”
17 At paragraphs 30-31
18 See e.g. Re Railways Professional Officers Award (1958) 89 CAR 40 and Re Metal Trades Award; Re State Electricity Commission of Victoria (1964) 106 CAR 535.
19 First Decision at [132]
20 Exhibit UFU-3 - Statement of Bruce Simpson at paragraph 6
21 Exhibit UFU-6 - Statement of Tony Martin at paragraph 4
22 Transcript of Proceedings C2011/5138 - 27 June 2012 at PN1043-1051
23 First Decision at [93]-[96]
24 Reproduced in the First Decision at [12]
25 MFB written submission at paragraph 41
26 Exhibit MFB-5 - Second Statement of Shane Wright at paragraph 16
27 (1982) 149 CLR 337 at 352 per Mason J
28 Community and Public Sector Union v Telstra Corporation Ltd (2005) 139 IR 141 at 152 [38]
29 Ibid at 153 [34], quoting BP Australia Pty Ltd v Nyran Pty Ltd (2003) 198 ALR 442 at 452-453 [34]
30 BP Australia Pty Ltd v Nyran Pty Ltd at 453 [34]
31 Exhibit MFB-5 - Second Statement of Shane Wright at paragraphs 9-17
32 UFU submissions at paragraph 33
33 See Second Decision at [70]
34 See e.g. Second Decision at [56]
35 Transcript 19 January 2013 at PNs 2552, 2593
36 Exhibit MFB 7, Statement of Kenneth Edwards, paragraph 20
37 (1936) 55 CLR 499 at 505 per Dixon, Evatt and McTiernan JJ
38 At [139]
39 Exhibit UFU-12 - Statement of Tony Martin at paragraph 9
40 Second Decision at [5]
41 Second Decision at [7]
42 Second Decision at [14]
43 Coal and Allied Operations Pty Limited v Australian Industrial Relations Commission (2000) 203 CLR 194 at 204-5 [19] per Gleeson CJ and Gaudron and Hayne JJ
44 First Decision at [157]
45 UFU’s written submissions at paragraph 26.
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