United Workers' Union v Fenner Dunlop Australia Pty Ltd T/A Fenner Dunlop Engineered Conveyor Solutions

[2021] FWC 950

[2021] FWC 950

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

United Workers’ Union
v
Fenner Dunlop Australia Pty Ltd T/A Fenner Dunlop Engineered Conveyor Solutions
(C2020/7256)

DEPUTY PRESIDENT YOUNG MELBOURNE, 22 FEBRUARY 2021

Dispute arising under an enterprise agreement.

[1] This decision concerns an application made by the United Workers’ Union (UWU) under section 739 of the Fair Work Act 2009 (Act) to deal with a dispute in accordance with the dispute settling procedure in clause 11 of the Fenner Dunlop & NUW (Footscray Manufacturing) Enterprise Agreement 2019 (Agreement).

[2] The dispute concerns the operation of the make up pay clause at clause 44.1 of the Agreement. The parties agreed at the hearing that the question to be determined in resolution of the current dispute is:

“Whether “usual weekly rate” as used in clause 44.1 of the Agreement is to be interpreted so as to include an employee’s overtime earnings.”

[3] Fenner Dunlop Australia Pty Ltd (Fenner Dunlop) says that the answer to the question is ‘no’. The UWU says that it is ‘yes’.

[4] The dispute proceeded to Arbitration hearing before me on 1 December 2020. Ms Sukanya Ananth appeared for the UWU. Mr Johan Myburgh of Ai Group appeared on behalf of Fenner Dunlop.

[5] Witness statements of Mr John Williams and Mr Kevin Hay, both Machine Operators at Fenner Dunlop were tendered by the UWU. Witness statements of Ms Emma Mulhern, Return to Work and Workers Compensation Coordinator at Fenner Dunlop and Mr Francesco (Frank) Spina, National Human Resources Manager at Fenner Dunlop were tendered by Fenner Dunlop. In light of confirmation from the parties that the witnesses would not be required for cross-examination, the witnesses did not attend the hearing.

Initial matters

[6] It is not contested, and I am satisfied that the matter in dispute is a matter that arises under the Agreement. Further, I am satisfied that the dispute settlement procedure at clause 11 of the Agreement has been complied with.

Background

[7] Since 2006 Fenner Dunlop has included in its employee collective/enterprise agreements a clause providing an entitlement to accident make up pay. 1

[8] Clause 46 of the Fenner Dunlop Conveyor Belting Australia & National Union of Workers Certified Agreement 2006 (2006 Agreement) provided for accident make up pay. 2 The provisions of clause 46 of the 2006 Agreement were replicated in the Fenner Dunlop Conveyor Belting Australia & National Union of Workers Certified Agreement 2010 and in the Fenner Dunlop (Footscray) & NUW Agreement 2013 (2103 Agreement) at clause 44.3

[9] Clause 44.2.3(a) of the 2013 Agreement provided for accident make up pay as follows:

“Total incapacity

In the case of an employee who is or deemed to be totally incapacitated within the meaning of the representative Act means a weekly payment of an amount representing the difference between, on the one hand, the total amount of compensation, including other allowances, paid to the employee during incapacity pursuant to the respective Act for the week in question and, on the other hand, the total weekly wage rate and other payments if any being paid to such employee at the date of the injury giving rise to said payment of compensation, together with or less as the case may be any variation in wage rates which would have been applicable to the classification of such employee for the week in question if he/she had been performing his/her normal duties providing that in making such calculation any payment for overtime, shift premiums, attendance bonusses, fares and travelling time allowances, penalty rates and any other ancillary payments payable shall not be taken into account, but piece or bonus work earnings during ordinary hours shall be taken into account.” 4

[10] Subclauses 44.2.3(b) and (c) of the 2013 Agreement provided make up pay for partial incapacity and payment for a part week, respectively. 5 Overtime was excluded from the calculation of make up accident pay in the 2013 Agreement.6

[11] The provisions of clause 44 of the 2013 Agreement were changed in the Fenner Dunlop (Footscray Manufacturing) & NUW Enterprise Agreement 2015 to those currently in clause 44.1 of the Agreement.

Clause 44.1 of the Agreement

[12] Clause 44.1 provides as follows:

“44. MAKE UP PAY

44.1. If an employee has an accident at his or her place of employment and is subject to, qualifies for and continues to receive compensation on a weekly basis under the Accident Compensation Act 1985 (Vic), such employee shall have the amount received by way of compensation increased by the Employer to the amount of the employee's usual weekly rate applying at the time of such accident. The payment made by the Employer shall be limited to a maximum period, or aggregated periods, of 52 weeks.”

(Emphasis added)

[13] It is uncontested that there is no definition of “usual weekly rate” contained in the Agreement.

[14] It is also uncontested that overtime is worked at the site. 7

Submissions

UWU’s submissions

[15] The UWU submits that the ordinary meaning of clause 44.1 and the words “usual weekly rate” is plain and unambiguous. 8 It submits that the clause comprises of three distinct elements, being that it:

1. sets out the circumstances in which an employee shall be entitled to the make up payment;

2. stipulates that the payments required to be made by Fenner Dunlop are such as to increase the compensation received by an eligible employee to the employee’s “usual weekly rate” applying at the time of the accident; and

3. clarifies that the payments made by the Respondent shall be limited to a maximum period, or aggregated periods, of 52 weeks. 9

[16] The UWU submits that the first element makes it clear that the obligation upon Fenner Dunlop to provide accident make up payments to eligible employees exists in conjunction with any entitlements arising under the Accident Compensation Act 1985 (Vic) (AC Act). 10 The UWU therefore says that it reasonably and plainly follows that the obligation on Fenner Dunlop under clause 44.1 is to pay the difference between the amount of compensation provided by the Insurer under the AC Act and the employee’s “usual weekly rate” as defined under the AC Act. Under the AC Act an employee’s usual weekly rate is termed pre-injury average weekly earnings (PIAWE).11 Under the Workplace Injury Rehabilitation and Compensation Act 2013 (Vic) (WIRC Act), PIAWE includes an employee’s overtime earnings.12 Accordingly, it is submitted that “usual weekly rate” in clause 44.1 of the Agreement includes an employee’s overtime earnings.

[17] The UWU submits that the change in the wording of the make up pay provisions in the 2015 Agreement from the 2013 Agreement demonstrates that it was the common intention of the parties that accident make up pay from the 2015 Agreement onwards would be based on the applicable state legislation which presently includes any regular overtime component. 13 The UWU submits14 that such an interpretation would accord with the Commission’s decision in Oktay Gunner v Cranbourne Transit.15 Further, it submits that the calculation of make up pay in the 2013 Agreement reflects the way in which compensation was calculated under relevant workers’ compensation legislation at that time (that is, exclusive of overtime).16 It submits that the workers’ compensation legislation changed substantially prior to the 2015 Agreement and the change to the language of clause 44 in the 2015 Agreement and thereafter is reflective of that legislative change.17

[18] The UWU submits that the term “weekly rate” in clause 44.1 is a referable to the hourly wage rates set out in clause 20 of the Agreement 18 and it is therefore the construction of the word “usual” that is the crux of the dispute.19 It submits that the inescapable conclusion to be reached from the use of the phrases “ordinary rates” and “ordinary hours” in certain other provisions of the 2019 Agreement but not in clause 44.1 is that a separate and distinct meaning must have been intended for the word “usual”.20 It submits that “usual” is defined in the Merriam-Webster Dictionary as that which is “accordant with usage, custom or habit” and “found in ordinary practice or in the ordinary course of events”. It contends that it is the ordinary custom and habit for employees to regularly work overtime hours on site21 and accordingly, the term “usual” is properly construed so as to include overtime earnings.22

[19] In the alternative, the UWU submits that if the phrase “usual weekly rate” is found to be ambiguous, uncertain or capable of more than one meaning, the context and history of clause 44.1 supports an interpretation which includes overtime earnings. Firstly, it submits that the changes to the language of the make up pay clause from the 2013 Agreement, which expressly excluded overtime payments from the calculation of make up pay, to the 2015 Agreement (as continued in the 2019 Agreement) which contains no such express exclusion must objectively be viewed as signifying a changed interpretation to one which includes overtime. 23 Secondly, it submits that evidence of both Mr Williams and Ms Mulhern, most specifically the email of 3 December 2019, discloses a common intention of the parties that overtime earnings be included in make up pay under the Agreement.24 Finally, the UWU submits that accident make up payments made to Mr Williams under the 2015 Agreement and to another employee under the Agreement, inclusive of overtime earnings, is post-agreement conduct of the parties evidencing a common understanding as to the meaning to be given to “usual weekly rate” in clause 44.1 to which the Commission may have regard.25

Fenner Dunlop’s submissions

[20] Fenner Dunlop also submits that the ordinary meaning of clause 44.1 and the words “usual weekly rate” is plain and unambiguous. 26

[21] Fenner Dunlop submits that an entitlement to make up pay arises when an employee is receiving compensation under the AC Act. It submits that the provisions of the AC Act remained unchanged between 2013 and 2019 and consequently the calculation of make up pay under the Agreement ought be construed in the same way as under the 2006, 2010 and 2013 Agreements. 27 Further, had the parties intended for make up pay under the Agreement to be calculated to include overtime, or in the same way in which PIAWE is calculated under the WIRC, this would have been expressly provided for.28

[22] Fenner Dunlop contends that the term the Commission must consider is “usual weekly rate” and that it would be erroneous to consider the word “usual” in isolation. 29 It submits that the terms “usually” and “rate” appear in Part 5 of the Agreement (Wages and Related Matters).30 It submits that an employee’s “usual weekly rate” is to be determined by multiplying an employee’s hourly wage rates, as contained in clause 20 of the Agreement for the classification under which an employee is engaged, by the employee’s ordinary weekly hours of work.31 It submits that the word “usual” has the same meaning as “usually”, as used in clause 22(b) of the Agreement, and means “normal, like always”. It submits therefore that in the context of clause 44.1 of the Agreement, “usual” refers to an employee’s weekly wage rate calculated as a multiple of the hours worked by the hourly wage rate for the classification in clause 20, under which the employee is “usually” employed.32 The Respondent relies upon Australian Municipal, Clerical and Services Union – NSW and ACT (Services) Branch v Qantas Flight Catering Ltd33 as authority for the proposition that a document should be construed so far as is possible so as to give the same meaning to the same words where ever they occur and submits that in circumstances where Part 5 of the Agreement provides rates of pay for every classification and that every employee has a classification in which they are “usually” employed, it would be inconsistent to define “usual weekly rate” to include payments not envisaged under that Part.34 It submits that the construction it advances applies a common-sense interdependence in the way the terms “usually”, “rate” and “mixed function” are used in Part 5 of the Agreement.35

[23] In the alternative, Fenner Dunlop submits that the context and history of clause 44.1 and its predecessor clauses supports an interpretation that an employee’s “usual weekly rate” does not include overtime earnings. Fenner Dunlop does not dispute that the wording of clause 44.1 of the 2015 Agreement changed. However, it submits that there is no evidence that the change was to reflect the changes in workers’ compensation legislation, or that this was the common intention of the parties or that the parties intended the operation of the make up pay clause to be altered. Fenner Dunlop relies upon the evidence of Mr Spina in this regard. 36 Further, it submits that overtime has been worked at the site based on operational needs since 2006, however, the 2006, 2010 and 2013 Agreements excluded overtime payments from the calculation of make up pay.

Evidence

[24] Mr Hay and Mr Williams tendered evidence for the UWU. Mr Hay’s evidence was that overtime is worked at the site and was essential to function of the industrial process. 37 Mr Hay’s evidence is that in a “bad year” little overtime is required but in a year “at the top of the mining cycle” employees may work a minimum of 60 hours a week.38 Mr Williams’ evidence was that certain roles at the site required employees to work 60 hours a week in order to keep up with production.39 His evidence was also that when mines where in full production the site runs continuously.40

[25] Mr Spina and Ms Mulhern tendered evidence for Fenner Dunlop. Mr Spina gave evidence that he participated in the negotiation of the 2015 Agreement. 41 His evidence was that the changes that were made to the 2015 Agreement were not made to change the intent or meaning of the relevant clause.42 His further evidence was that at no time was he involved in negotiations to include overtime payments in make up pay.43 Finally, Mr Spina’s evidence was that to his knowledge the Respondent had never mandated employees to work overtime on certain equipment that required continuous running.44 Ms Mulhern’s evidence was that she had made make up payments on the basis of overtime and shift penalties in error,45 including to Mr Williams,46 and that it was not until about August 2020 that she became aware that make up pay did not include overtime.47

Consideration

Legal principles

[26] The principles applicable to the interpretation of enterprise agreements are well settled. These principles, known as the Berri Principles, were established in Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union’ known as the Australian Manufacturing Workers Union (AMWU) v Berri Pty Limited 48(Berri) I set out the Berri Principles below:

“1. The construction of an enterprise agreement, like that of a statute or contract, begins with a consideration of the ordinary meaning of the relevant words. The resolution of a disputed construction of an agreement will turn on the language of the agreement having regard to its context and purpose. Context might appear from:

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

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

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

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

3. The common intention of the parties is sought to be identified objectively, that is by reference to that which a reasonable person would understand by the language the parties have used to express their agreement, without regard to the subjective intentions or expectations of the parties.

4. The fact that the instrument being construed is an enterprise agreement made pursuant to Part 2-4 of the FW Act is itself an important contextual consideration. It may be inferred that such agreements are intended to establish binding obligations.

5. The FW Act does not speak in terms of the ‘parties’ to enterprise agreements made pursuant to Part 2-4 agreements, rather it refers to the persons and organisations who are ‘covered by’ such agreements. Relevantly s.172(2)(a) provides that an employer may make an enterprise agreement ‘with the employees who are employed at the time the agreement is made and who will be covered by the agreement’. Section 182(1) provides that an agreement is ‘made’ if the employees to be covered by the agreement ‘have been asked to approve the agreement and a majority of those employees who cast a valid vote approve the agreement’. This is so because an enterprise agreement is ‘made’ when a majority of the employees asked to approve the agreement cast a valid vote to approve the agreement.

6. Enterprise agreements are not instruments to which the Acts Interpretation Act 1901 (Cth) applies, however the modes of textual analysis developed in the general law may assist in the interpretation of enterprise agreements. An overly technical approach to interpretation should be avoided and consequently some general principles of statutory construction may have less force in the context of construing an enterprise agreement.

7. In construing an enterprise agreement it is first necessary to determine whether an agreement has a plain meaning or it is ambiguous or susceptible of more than one meaning.

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

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

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

11. The admissibility of evidence of the surrounding circumstances is limited to evidence tending to establish objective background facts which were known to both parties which inform and the subject matter of the agreement. Evidence of such objective facts is to be distinguished from evidence of the subjective intentions of the parties, such as statements and actions of the parties which are reflective of their actual intentions and expectations.

12. Evidence of objective background facts will include:

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

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

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

13. The diversity of interests involved in the negotiation and making of enterprise agreements (see point 4 above) warrants the adoption of a cautious approach to the admission and reliance upon the evidence of prior negotiations and the positions advanced during the negotiation process. Evidence as to what the employees covered by the agreement were told (either during the course of the negotiations or pursuant to s.180(5) of the FW Act) may be of more assistance than evidence of the bargaining positions taken by the employer or a bargaining representative during the negotiation of the agreement.

14. Admissible extrinsic material may be used to aid the interpretation of a provision in an enterprise agreement with a disputed meaning, but it cannot be used to disregard or rewrite the provision in order to give effect to an externally derived conception of what the parties’ intention or purpose was.

15. In the industrial context it has been accepted that, in some circumstances, subsequent conduct may be relevant to the interpretation of an industrial instrument. But such post-agreement conduct must be such as to show that there has been a meeting of minds, a consensus. Post-agreement conduct which amounts to little more than the absence of a complaint or common inadvertence is insufficient to establish a common understanding.”

[27] The Full Bench of the Commission in Construction, Forestry, Mining and Energy Union v Endeavour Coal Pty Ltd T/A Appin Mine 49 (Endeavour Coal), considered Australian Meat Industry Employees Union v Golden Cockerel Pty Ltd50 (Golden Cockerel) and Berri in the following terms:

“[42] In Golden Cockerel, the Full Bench set out authorities which make it clear that while the task of construction begins with consideration of the ordinary meaning of the words of the agreement, regard must be paid to the context and purpose of the provision or expression being construed. Those authorities make clear that context and purpose are relevant to construction and must be considered even where the words of the provision being construed appear, on their face, to have a clear and unambiguous meaning.

[43] In this regard, the Full Bench in Golden Cockerel had set out at [29] the explanation of this point by the NSW Court of Appeal in Mainteck Services Pty Ltd v Stein Heurtey SA. Relevantly, that explanation emphasises the following matters:

•  Until a word or phrase is understood in the light of the surrounding circumstances, it is rarely possible to know what it means and there is always some context to any statement;

•  Language considered in its context will often have a clear meaning and context will often not displace that meaning – “but not always”;

•  To state that a legal text is clear reflects the outcome of an interpretation process and means that there is nothing in the context that detracts from the ordinary literal meaning and cannot mean that context can be put to one side;

•  The phrase used by Mason J in Codelfa “if the language is ambiguous or susceptible of more than one meaning” does not mean that the susceptibility of the language to more than one meaning must be assessed without reference to the surrounding circumstances and in order to determine whether more than one meaning is available it may be necessary to turn to context; and

•  Context has also been described as surrounding circumstances and the meaning of terms normally requires consideration not only of the text, but of the surrounding circumstances known to the parties and the purpose and object of the transaction.” (footnotes omitted)

[28] Further, the Full Bench of the Commission in United Firefighters Union of Australia v Emergency Services Telecommunications Authority T/A ESTA, 51 stated:

“[35] As stipulated in Berri, the starting point for interpreting an enterprise agreement is to have regard to the ordinary meaning of the words used. Further, the text must be interpreted in the context of the agreement as a whole. Principles 7 and 10 elicited in Berri emphasise that ambiguity in a provision within an enterprise agreement must be identified before one is to have regard to evidence of the surrounding circumstances. However, principle 8 makes it clear that, in determining whether ambiguity exists, one may have regard to evidence of the surrounding circumstances. That is, such evidence can be used to identify and resolve any ambiguity.”

[29] The principles applying to the interpretation of an enterprise agreement have also been the subject of much Federal Court exegesis. The Full Court of the Federal Court in WorkPac Pty Ltd v Skene 52said at [197]:

“The starting point for interpretation of an enterprise agreement is the ordinary meaning of the words, read as a whole and in context: City of Wanneroo v Holmes (1989) 30 IR 362 at 378 (French J). The interpretation “… turns on the language of the particular agreement, understood in the light of its industrial context and purpose …”: Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241 at [2] (Gleeson CJ and McHugh J). The words are not to be interpreted in a vacuum divorced from industrial realities (Holmes at 378); rather, industrial agreements are made for various industries in the light of the customs and working conditions of each, and they are frequently couched in terms intelligible to the parties but without the careful attention to form and draftsmanship that one expects to find in an Act of Parliament (Holmes at 378–9, citing Geo A Bond & Co Ltd (in liq) v McKenzie [1929] AR(NSW) 498 at 503 (Street J)). To similar effect, it has been said that the framers of such documents were likely of a “practical bent of mind” and may well have been more concerned with expressing an intention in a way likely to be understood in the relevant industry rather than with legal niceties and jargon, so that a purposive approach to interpretation is appropriate and a narrow or pedantic approach is misplaced: see Kucks v CSR Limited (1996) 66 IR 182 at 184 (Madgwick J); Shop Distributive and Allied Employees’ Association v Woolworths SA Pty Ltd [2011] FCAFC 67 at [16] (Marshall, Tracey and Flick JJ); Amcor at [96] (Kirby J).”

(footnotes omitted)

[30] In summary, it is well accepted that the construction of an enterprise agreement begins with ordinary meaning of the words used; see: Berri at [114]. Where there is a dispute about the construction of an enterprise agreement, the resolution will turn on the language of the agreement, having regard to its context and purpose; see: Golden Cockerel. Context might appear from the text of the agreement when viewed as a whole, the disputed provision’s place and arrangement in the agreement and the legislative framework under which the agreement was made; see: Berri Principle 1 at [114] and Golden Cockerel Principle 8 at [41]. However, the task of interpreting an agreement does not involve rewriting the agreement to achieve what might be regarded as a fair or just outcome; see: Berri Principle 2 at [114].

Ordinary meaning of clause 44.1

[31] I first address the UWU’s submissions set out at paragraphs [15-18] above regarding the ordinary meaning of clause 44.1.

[32] In support of its construction of clause 44.1, the UWU submits that clause 44.1 comprises three elements, as set out in paragraph [15] above. I accept that submission. I also accept the UWU’s submission as to the composition of those three elements as set out in paragraph [15] above. However, I reject the submission that the obligation to provide accident make up payments under clause 44.1 exists “in conjunction” with any entitlements arising under the AC Act, in the sense submitted by the UWU, and that it therefore “plainly follows” that the obligation on the employer under clause 44.1 is to pay the difference between the amount of compensation paid by the insurer and PIAWE. Firstly, I consider the obligation to provide make up pay under clause 44.1 is more properly construed as a contingent obligation that arises upon an employee being entitled to and receiving workers’ compensation payments on a weekly basis. Accordingly, entitlement to and receipt of workers’ compensation payments is a pre-condition to the obligation to provide make up payments arising. It is only to that extent that the obligations under clause 44.1 exist “in conjunction” with entitlements arising under the AC Act. Secondly, the provisions of the AC Act are not incorporated or otherwise expressly adopted by the Agreement such that definitions used in that legislation, without more, apply to phrases used in the Agreement. Thirdly, there is nothing in the plain language of clause 44.1 that lends support for the contention that the phrase “usual weekly rate” is necessarily to be defined as PIAWE pursuant to the relevant legislation. Had that been intended, I consider it would have been expressly provided for. It is not. Fourthly, the phrase “usual weekly rate” is not used in the AC Act and PIAWE is not used in clause 44.1.

[33] The UWU submits that the legislative provisions of the AC Act have changed over time and that the amendment of the Agreement from 2015 onwards is reflective of a common intention of the parties that make up pay would be based on the manner in which compensation under the applicable state legislation is calculated. Fenner Dunlop dispute that the relevant provisions have changed over time. In the present circumstances, it is not necessary for me to determine that issue, as even if it be the case that the AC Act did change over time as contended for by the UWU, for the following reasons I reject that UWU’s submissions as to this matter. Firstly, clause 44.1 references the AC Act, notwithstanding that the relevant legislation when the 2015 Agreement and the Agreement was entered into was, and remains, the WIRC Act. In those circumstances, I do not consider the changes to the make up pay provisions in the 2015 Agreement can be said to reflect the intention contended for. Secondly, the changes to the make up provisions in the 2015 Agreement are extensive and go far beyond the deletion of the express overtime exclusion. They are significant and comprehensive. The provisions of the 2013 Agreement in relation to make up pay are consolidated from three subclauses into one. The clause has been significantly simplified and a much plainer approach to drafting adopted. The language used in the clause is also significantly altered. Further, the basis for the make up pay calculation under the 2013 Agreement, and from which overtime is excluded, is the employee’s “total weekly wage rate”, in contradistinction to the use of the phrase “usual weekly rate” in the 2015 Agreement onwards. As such, I do not consider that the absence of an express exclusion of overtime from the provisions of the 2015 Agreement and clause 44.1, in and of itself, gives rise to the consequence contended for by the UWU.

Ordinary meaning of “usual weekly rate”

[34] I consider that clause 44.1 and the words “usual weekly rate” have a plain meaning and are unambiguous. For the reasons that follow, I consider that the ordinary meaning of “usual weekly rate” in clause 44.1, when read as a whole and in the context of the Agreement, includes an employee’s overtime earnings.

[35] I reject the submission that the word “usual” is the crux of the current dispute. I consider that the entire phrase in dispute must be considered, in the context of clause 44.1 and the Agreement as a whole.

[36] Clause 44.1 is included in Part 10 of the Agreement. Part 10 is headed “Occupational Health and Safety Matters, Equipment and Tools”.

[37] The term “usual weekly rate” is not defined in Part 10 or, indeed, elsewhere in the Agreement. Nor is there any reference in the Agreement to “usual” rates of pay.

[38] Rates of pay are included in Part 5 of the Agreement. Part 5 is headed “Wage Rates and Classification Descriptors”. Clause 20.1 is included in Part 5 and provides “hourly wage rates” for each classification in which employees may be engaged. Clause 20.2 provides that the “rates of pay” contained in clause 20.1 are all-purposes rates. I consider it clear that references throughout the agreement to “rates” are references to the hourly rates of pay set out in clause 20.1. The Agreement, however, does not contain any weekly rates of pay and provides for hourly rates of pay only. 53 I accept the submission that weekly rates of pay are calculable by reference to the hourly rates set out in clause 20 of the Agreement.54 I also consider it clear that the rates in clause 20 are for ordinary hours of work and form the basis for the calculation of any overtime and shift work payments that may apply.

[39] At issue therefore is whether the phrase “usual weekly rate” as used in clause 44.1 is to be construed as a reference to the weekly rate extrapolated from the hourly rates in clause 20.1 for each classification for ordinary hours worked or, alternatively, as the weekly rate payable to an employee for the weekly hours actually worked. I have concluded it is the latter.

[40] Firstly, in the context of the Agreement as a whole, and in particular the working arrangements provided in the Agreement, I do not consider that the phrase “usual weekly rate” evidently or plainly excludes overtime earnings, or necessarily leads to the conclusion that as a matter of plain reading it is limited to payment for ordinary hours of work only.

[41] Secondly, whilst I accept that the word “rate” is used in Part 5 of the Agreement and takes some meaning form that, the disputed words are a composite phrase of which the word “rate” is but one component.

[42] Thirdly, as already set out, there is no reference in the Agreement to “usual”rates of pay, hourly or otherwise. However, theAgreement does, at various points, speak of “ordinary rates”. Clause 31.3 provides for four-day roster employees to be paid their “ordinary base hourly pay rate” on non-rostered public holidays. Clause 31.6 of the Agreement, which deals with shiftwork penalties, refers to an employee’s “ordinary rate” as the basis for the calculation of shift penalties. Clause 33 of the Agreement provides for payment of work on a Sunday, in certain circumstances, to be at “ordinary rates”rather than Sunday rates. Clause 35.12 which deals with make up time, makes reference to “ordinary rates of pay”, while clause 42.1 also speaks of an employee’s “ordinary rate”. In the context of the Agreement, I consider it clear that these are all references to the hourly rates contained in clause 20.1 of the Agreement for ordinary hours of work. Further, I accept the UWU’s submission that “ordinary rates of pay” has a well-established industrial meaning, being payment for ordinary hours of work and excluding any amount payable for shift work, overtime or other penalties. 55 I consider that the use of these phrases in other provisions of the Agreement but not in clause 44.1 indicates, prima facie, that a separate and distinct meaning is to be given to the phrase “usual weekly rate” and in particular that “usual” is not synonymous with “ordinary”. Consequently, I consider that “usual weekly rate” in clause 44.1 means something other than the weekly rate extrapolated under clause 20 by calculating an employee’s hourly rate for each classification and multiplying it by ordinary hours of work. Had it been intended that the obligations under clause 44.1 were to be by reference to an employee’s ordinary rate, given its use elsewhere in that Agreement, clause 44.1 could have easily so provided. I therefore reject Fenner Dunlop’s submission that the term “usual” in the context of clause 44.1, refers to an employee’s weekly wage rate calculated as a multiple of hours worked by the hourly wage rate for the classification in clause 20, under which an employee is “usually” employed and that it would be inconsistent to define “usual weekly rate” to include payments not envisaged under Part 5. For my part I find no particular assistance is to be gained from the use of “usually” in clause 22(b) in the context of the phrase “usual weekly rate”. The former is concerned with the classification in which an employee is employed, while the latter is concerned with that employee’s rate of pay. Further, such an approach is primarily concerned with determining what the employee’s hourly rate is, not with what meaning is to be ascribed to the phrase “usual weekly rate”. In addition, clause 23.3 of the 2013 Agreement is worded in the same way as clause 22(b) of the Agreement, yet the make up pay provisions of the 2013 Agreement contain no reference to “usual” hourly or weekly rates. In this regard, I consider Fenner Dunlop’s reliance on Australian Municipal, Clerical and Services Union – New South Wales and ACT (Services) Branch v Qantas Flight Catering Limited56 to be misconceived.

[43] Fourthly, clause 44.1 refers to the usual weekly rate “applying” at the time of the accident. The word “applying” is in the present tense and, in my view, creates a nexus between the usual weekly rate to be paid under clause 44.1 and that which is actually being paid to the employee at the time of the accident. Accordingly, where an employee is receiving payment for overtime at the time of the accident, that is the usual weekly rate that is “applying” at that time.

[44] Finally, the Agreement provides for a range of shift patterns. Clause 31.1(a) provides that employees work 4 x 9.5 hour shifts per week, Monday to Thursday inclusive. Clause 31.1(b) of the Agreement provides that all hours in excess of 9.5 hours, or on a Friday, Saturday or Sunday are paid at overtime rates. Clause 31.2 provides that the shift arrangements in clause 31.1(a)(i) may be altered to a Tuesday to Friday shift pattern, in which case clause 31.2(a)(v) requires overtime to be paid for all time regularly and customarily worked on a Friday. Clause 31.4 of the Agreement provides for the mandatory rostering of two hours overtime during “peak periods”. Clause 31.6 provides that employees may work continuous work shifts, afternoon and night shifts, and seven day shift rosters, all of which attract shift penalty rates. 57 In light of the provisions of clause 31, even adopting Fenner Dunlop’s preferred interpretation of the word “usual”, it cannot be said that the “normal, like always” weekly wage rate for employees working the roster patterns provided for under clause 31 is the weekly rate of pay extrapolated from the hourly rates of pay for ordinary hours in 20.1. In this context to construe “usual weekly rate” as being payment for ordinary hours only would, in my view, led to an illogical outcome and one which does not accord any meaning to the word “usual”. Such a construction ought not be preferred.

Submissions in the alternative

[45] In light of the above, it is not necessary that I address the parties’ submissions made in the alternative. Further, I have not had regard to the evidence of the witnesses as to their subjective views as to what the clause was intended to achieve or their understanding of the clause’s operation. Berri establishes that the common intention of the parties is to be identified objectively, by reference to what a reasonable person would understand by the language the parties have used to express their agreement, without regard to the subjective intention of the parties or expectations of the parties. Further, if clause 44.1 has a plain meaning, as I have found, evidence of surrounding circumstances will not be admitted to contradict the plain language of the agreement. Additionally, I consider that Mr Hay’s evidence as to what is “usual” is opinion evidence, and if admissible at all, ought be given little, if any, weight.

[46] For completeness, I address two final matters. Firstly, the UWU placed reliance upon the decision of Guner v Cranbourne Transit Pty Ltd. 58 I accept Fenner Dunlop’s submission that Guner is distinguishable from the present case. In Gunner, the terms of a former award were incorporated into the agreement and contained a definition of average weekly earnings for the purposes of make up pay which expressly excluded overtime earnings. The relevant definition in the body of the agreement made no refence to the exclusion of overtime earnings from the entitlements to make up pay. At issue, therefore, was whether the definition under the award or the agreement applied. Upon determination of that question, the question of whether overtime earnings were included in Mr Guner’s accident make up pay was also determined. No such issue presently arises. Accordingly, I find no assistance from the decision in Guner in the present circumstances. Secondly, the UWU submits that “the amount of [an] employee’s usual weekly rate applying at the time of [an] accident”under clause 44.1 is to be calculated by applying an employee’s hourly rate of pay for the classification in which the employee is employed and under which they “usually” perform work, averaged across a 12-month period and including overtime and shift penalties, in line with the manner in which an eligible employee’s PIAWE is calculated under the WIRC Act.59 Whilst I accept that an eligible employee’s “usual weekly rate” for the purpose of clause 44.1 includes overtime earnings, if any, applying at the time of the accident, I reject the submission that clause 44.1 requires such earnings are to be averaged over a 12-month period. Firstly, for the reasons set out earlier in this decision I reject that clause 44.1 is intended to reflect the provisions of the WIRC Act and the concept of PIAWE. Secondly, I consider clear words would be required before “usual weekly rate” in clause 44.1 could be interpreted so as to require averaging of earnings over a 12-month period as submitted. In the absence of such clear language such a construction must, in my view, be rejected.

Conclusion

[47] An employee’s overtime earnings applying at the time of the accident are included in the “usual weekly rate” upon which make up payment are calculated under clause 44.1 of the 2019 Agreement.

DEPUTY PRESIDENT

Appearances:

S Ananth for the Applicant
J Myburgh, Ai Group, on behalf of the Respondent

Hearing details:

2020.
Melbourne (by telephone):
1 December.

Printed by authority of the Commonwealth Government Printer

<PR727189>

 1   Applicant’s submissions filed 29 October 2020 at [7], [9] and [11]; Respondent’s submissions filed 12 November 2020 at [21]

 2   Applicant’s submissions filed 29 October 2020 at [7]

 3   Ibid at [9]

 4   Respondent’s submissions filed 12 November 2020 at [11]

 5   Ibid at [12]

 6   Applicant’s submissions filed 29 October 2020 at [8-9]; Respondent’s submissions filed 12 November 2020 at [13]; 2013 Agreement, clause 44.2.3(a)

 7   Respondent’s submissions filed 12 November 2020 at [64]

 8   Applicant’s submissions filed 29 October 2020 at [16]

 9   Ibid at [17-18]

 10   Ibid at [19]

 11   Ibid at [21]

 12   Ibid at [22]

 13   Ibid at [23]

 14   Ibid at [24]

 15   [2018] FWC 327

 16   Applicant’s reply submissions at [7]

 17   Ibid at [6-7]

 18   Applicant’s submissions filed 29 October 2020 at [26]

 19   Ibid at [28]

 20   Ibid at [26-33]

 21   Ibid at [34] and [36-40]

 22   Ibid at [42-43]

 23   Ibid at [45]

 24   Ibid at [46]

 25   Ibid at [47-48]

 26   Respondent’s submissions filed 12 November 2020 at [15]

 27   Ibid at [17-20], [47(ii)]

 28   Ibid at [47(iv)]

 29   Ibid at [41], [48]

 30   Ibid at [32]

 31   Ibid at [45]

 32   Ibid at [32-46]

 33   [2003] AIRC 1311

 34   Respondent’s submissions filed 12 November 2020 at 47(i), [51-54]

 35   Ibid at 47(iii)

 36   Ibid at [55-60]

 37   Witness Statement of Kevin Hay dated 29 October 2020 at [2-4]

 38   Ibid dated 29 October 2020 at [5]

 39   Witness Statement of John Williams dated 29 October 2020 at [1], [3]

 40   Ibid dated 29 October 2020 at [3]

 41   Witness Statement of Francesco Spina dated 11 November 2020 at [5]

 42   Ibid at [11-12], [20]

 43   Ibid at [16]

 44   Ibid at [17-18]

 45   Witness Statement of Emma Mulhern dated 12 November 2020 at [11], [19]

 46   Ibid at [23], [25-26]

 47   Ibid at [12]

 48   [2017] FWCFB 3005 (Berri)

 49   [2017] FWCFB 4487 (Endeavour Coal)

 50   [2014] FWCFB 7447 (Golden Cockerel)

 51   [2017] FWCFB 4537

 52 [2018] FCAFC 131

 53   Agreement, Part 5, clause 20

 54   Applicant’s submissions filed 29 October 2020 at [26]

 55   Ibid at [31], [35]; Applicant’s submissions in reply filed 24 November 2020 at [31]

 56 [2003] AIRC 131 (Print PR939695)

 57   Agreement, Part 6, clause 31.6

 58   [2018] FWC 327 (Guner)

 59   Applicant’s submissions in reply filed 24 November 2020 at [37]