United Workers' Union v Serco Australia Pty Ltd T/A Serco
[2021] FWC 4010
•26 JULY 2021
| [2021] FWC 4010 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.739—Dispute resolution
United Workers’ Union
v
Serco Australia Pty Ltd T/A Serco
(C2020/7409)
DEPUTY PRESIDENT BOYCE | SYDNEY, 26 JULY 2021 |
Alleged dispute about matters arising under the Serco Immigration Services Agreement 2018 – agreed articulated question to be answered – payment of meal allowances – payment of travel allowances – determination of applicable meal and/or travel allowances payable to relevant employees who travel for the purposes of escorting detainees from one location (in Australia) to another location (overseas).
Introduction
[1] An application has been made by the United Workers Union – New South Wales (UWU) for the Commission to resolve a dispute under the Serco Immigration Services Agreement 2018 (Agreement). 1
[2] The Agreement applies to Serco Australia Pty Ltd T/A Serco (Respondent) and its relevant employees. The UWU is covered by the Agreement. The Respondent is a provider of immigration services, and is relevantly a party to various contracts for the provision of security and detention services to or on behalf of the Commonwealth Department of Home Affairs in Australian immigration detention centres.
[3] Conciliation conferences held between the parties before the Commission failed to resolve the dispute, and Directions were issued to program the matter for hearing. 2 At the hearing, Mr Tom Whiteside, Industrial Officer, and Mr Justin Davis, Industrial Officer, appeared for the UWU. Mr Paul Brown, Partner, Baker McKenzie Lawyers, instructed by Ms Lisa Tran, In-house Senior Legal Counsel, appeared with permission for the Respondent.3
[4] There is no contest between the parties as to the jurisdiction of the Commission to resolve this dispute by way of arbitration in accordance with clause 45 of the Agreement, and s.739 of the Fair Work Act 2009 (Act). 4 I equally make this finding.
Background – Agreed facts and issues
[5] The UWU has brought this application in respect of its member, Mr Ethan Koschel. Mr Koschel is employed by the Respondent as a Detainee Services Officer (DSO) at the Villawood Immigration Detention Centre (VIDC). The Agreement applies to Mr Koschel.
[6] The parties agree upon the following facts and circumstances:
(a) Mr Koschel was, for the purposes of the Agreement, involved in an “escort” (on various occasions (Four Escorts)) that involved the transportation of a detainee to an international destination. In each case, Mr Koschel was travelling as part of an International Escort;
(b) For each of the Four Escorts, Mr Koschel departed from his normal place of work, being the VIDC, on the first day of the escort, and proceeded to Sydney Airport (in company with the detainee) to commence the outward travel leg of the International Escort;
(c) Mr Koschel (on each of the Four Escorts) spent at least one “night” away from his normal place of work/home whilst undertaking the International Escort;
(d) Mr Koschel, on each of the Four Escorts, after delivering the detainee to his/her relevant destination, travelled back to Sydney Airport (absent the company of a detainee), and then travelled back to his place of work (the VIDC), having spent the night travelling on an aircraft from the relevant international location;
(e) Mr Koschel on each of the Four Escorts was paid:
(i) the applicable rates of pay (including penalty rates and overtime) under the Agreement for each of the Four (International) Escorts; and
(ii) the amount prescribed at clause 19(e)(iv) of the Agreement, being the “domestic travel allowance” (otherwise known as the “overnight allowance” and/or “per diem”) (Overnight Allowance). 5
[7] This dispute specifically concerns the payment of:
(a) meal allowance/s [breakfast, lunch, dinner and/or evening meals], as set out under clause 19(e)(iii) of the Agreement;
(b) the Overnight Allowance, as set out under clause 19(e)(iv) of the Agreement; 6 and
(c) whether meal allowances continue to fall due and payable to relevant employees when the Overnight Allowance falls due and is payable (or is paid), and if so, in what circumstances.
Agreed Articulated Question
[8] The parties agree, for the purposes of resolving this dispute, that the Commission answer the following “Agreed Articulated Question”:
“In the circumstances of Mr Koschel, VIDC DSO, with respect to the International Escorts completed by him and set out at Annexure A (below, being the Four Escorts)), was Mr Koschel, at all relevant times:
(a) “travelling” under the instruction of the Respondent in accordance with clause 19(e)(iii) of the Agreement, or
(b) “travelling” under the instruction of the Respondent in accordance with clauses 19(e)(iv) and 19(m)(I) of the Agreement, or
(c) a combination of (a) and (b) above, to the extent any combination may be held to be applicable to each International Escort.”
Annexure A
International Escort Periods | Escort Details | Allowances Paid pursuant to clause 19(e)(iv), and clause 19(m)(I) | Allowances Paid pursuant to clause 19(e)(iii) |
| START: 11.45 am 30 January 2019 | Sydney to Nepal | 30 January 2019 - $107.39 | Nil |
| START: 2.00 pm 23 October 2019 | Sydney to Tonga | 23 October 2019 - $107.39 | Nil |
| START: 8.30 am 25 November 2019 | Sydney to Fiji | 25 November 2019 - $107.39 | Nil |
| START: 4.30 am 16 January 2020 | Sydney to India | 16 January 2020 - $109.54 | Nil |
Interpretation of enterprise agreements
[9] My determination in this matter applies the principles set out in Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers Union v Berri Pty Ltd (Berri). 7 Such principles were summarised by Deputy President Gostencnik in Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers’ Union v Paper Australia Pty Ltd8:
“In short compass, much like the approach to construing a statute, the construction of a provision in an enterprise agreement begins with a consideration of the ordinary meaning of the words used, having regard to the context and evident purpose of the provision or expression being construed. Context may be found in the provisions of the agreement taken as a whole, or in their arrangement and place in the agreement being considered. The statutory framework under which the agreement is made may also provide context, as might an antecedent instrument or instruments from which a particular provision or provisions might have been derived. The industrial context in making an enterprise agreement and in which it operates is also relevant”. 9
Relevant terms of the Agreement
[10] For the purposes of this dispute, the relevant terms of the Agreement read:
“Clause 19(b) – Overtime Meal Allowance
If an Employee is required to perform overtime duty for more than two hours after his/her usual ceasing time, that Employee will either be provided with a meal of suitable quality or paid $15.44 as a meal allowance. Meal allowances, and the provision of meals, shall apply to both day and night shifts. The provisions of this subclause do not apply when the provisions of sub-clauses 19(e), (f) and (m) apply in relation to the same meal event (e.g. when an Employee works overtime whilst travelling away from their normal place of work).”
…
“Clause 19(e)(iii) – Meal allowances
Where an Employee is travelling under the instructions of the Company or is required to perform duty other than at his/her normal place of work and does not require an overnight stay or is not on a secondment, they will be entitled to the following allowances.
Breakfast - leaving before 6.00am and arriving back after 8.00am | $23.53 |
Lunch - leaving before 11.00am and arriving back after 1.00pm | $26.09 |
Dinner- leaving before 6.00pm and arriving back after 8.00pm | $45.01 |
Evening - leaving before 11.00pm and arriving back after 1.00am | $26.09 |
Clause 19(e)(iv) – Overnight Allowance
Where an Employee is travelling under the instructions of the Company or is required to perform duty other than at his/her normal place of work, and does require an overnight stay, the Company will pay the cost of accommodation, and the Employee will be paid domestic travel allowance expenses of $105.39 [with indexation now $109.54] 10 for each night he/she is away from home. This amount covers the cost of all meals. Accordingly, the travelling meal allowance in19(e)(iii) and the overtime meal allowance in clause 19(b) will not apply.”
…
“Clause 19(i) – Transport and Escort (T & E)
When an Employee undertakes transport and escort duties away from his/her normal place of work, the provisions of sub-clauses 19(e)(iii), 19(j), 19(k) and (m) apply. The provisions of this sub-clause do not apply when the provisions of sub-clauses 19(e)(iv) and/or (f) [applicable to Secondments] apply.”
…
“Clause 19(j) – Transport and Escort (T & E)
When an Employee is on escort within Australia normal rates of pay will apply when escorting with a detainee, including overtime rates if applicable, but an Employee will be paid ordinary time (without overtime) where the escort is returning without a detainee. This ordinary time worked will be used for the accrual of ordinary time within the roster. Payment does not apply to periods of stand down (time not traveling or worked; e.g. overnight accommodation time).
Clause 19(k) – Transport and Escort (T & E)
When an Employee is on international escort then normal rates of pay shall apply when escorting with a detainee, including overtime rates if applicable, but an Employee will be paid ordinary time (without overtime) where the escort is returning without a detainee. This ordinary time worked will be used for the accrual of ordinary time within the roster.
Clause 19(l) – Transport and Escort (T & E)
Payment does not apply to periods of up to 10 hours duration in any 24 hours as a stand down time (i.e. overnight accommodation time} but does not include traveling time, time in transit, time waiting to travel or time otherwise worked on Serco duties. Where an Employee's roster permits and the Employee elects to stay over for additional time (subject to Company approval), this time will be unpaid and any additional costs will be borne by the Employee.
Clause 19(m) – Escorts requiring an overnight stay
“(I) Where an Employee performs duty away from his/her normal place of work, and requires an overnight stay during a period of stand down whilst off duty, the Company will pay the cost of accommodation, and the Employee will be paid the domestic travel allowance expenses in clause 19(e)(iv) for each night he/she is away from home. This amount covers the cost of all meals. Meal allowances in clauses 19(b) and 19(e)(iii) will not apply.
(II) Where an Employee remains on duty overnight, and no accommodation is required, the domestic travel allowance expenses in sub-clause 19(e)(iv) will not apply. The T&E meal allowance in sub-clause 19(e)(iii) hereof will still apply, unless a meal is provided to the Employee.”
[11] I note that clauses 19(e), (i), (ii), and (v), of the Agreement all concern the payment by the Respondent of an employee’s travel (e.g. airfare) and accommodation costs, and excess travel time. In other words, the payment of the Overnight Allowance is not related to, and does not concern, for example, the payment of an allowance to a relevant employee for the purposes of reimbursing the employee (in whole or in part) for the costs of airfares, hotels, and/or excess travel time. Nor does the Overnight Allowance concern payment for work performed (e.g. ordinary time or overtime), which are dealt with (in terms of travel and escorts) under clauses 19(j), (k), and (l) of the Agreement.
Evidence of the parties
[12] The UWU relied upon the following evidence in this matter:
(a) Witness Statement of Mr Terry Hugo, DSO at the VIDC, and UWU delegate at the VIDC, dated 23 March 2021;
(b) Witness Statement of Mr Michael Vance, Industrial Officer, UWU, dated 26 March 2021;
(c) Witness Statement of Mr Koschel, DSO at the VIDC, dated 25 March 2021; and
(d) A bundle of emails (one email dated 20 October 2015, two emails dated 21 October 2015, two emails dated 22 October 2015, and one email dated 21 December 2015). 11
[13] Mr Vance’s evidence is (relevantly) that no changes to what are now clauses 19(e)(iv) and 19(m) of the Agreement were explained to relevant employees leading up the making of the Serco Immigration Services Agreement 2015 (2015 Agreement), which is the predecessor enterprise agreement to the Agreement which is the subject of this dispute. 12
[14] The evidence of Mr Hugo and Mr Koschel is (relevantly) that before late 2015, the Respondent paid both the Overnight Allowance and meal allowances (the latter when the last day of an overseas stay did not require a further overnight stay). They both give evidence of purchasing meals on a return trip from an overnight stay. 13
[15] The Respondent relied upon the following evidence in this matter:
(a) Witness Statement of Mr Colin Joseph Graham, the Respondent’s National Industrial Relations Manager, dated 9 April 2021; and
(b) Additional Witness Statement of Mr Graham, dated 22 April 2021.
[16] Mr Graham’s evidence is (relevantly) that:
(a) He has no recollection of a discussion with Mr Vance in 2014 or 2015 relating to enterprise agreement negotiations about meal allowances, or the payment of same where an overnight stay occurs. 14
(b) An International Escort begins when a DSO is briefed and leaves the Respondent’s (detention centre) site, and concludes when the DSO arrives back at that site. 15
(c) The UWU’s claim, as it concerns Mr Koschel, relates to four days where Mr Koschel, the night before each day, was “in the air” on an international flight en route back to Sydney and paid the Overnight Allowance. 16
(d) Having undertaken relevant searches, the Respondent has no records of Mr Koschel performing an overnight stay and being paid the Overnight Allowance and meal allowance/s prior to 2015 (i.e. as asserted by Mr Koschel in his witness statement). 17
(e) In relation to the bundle of emails tendered by the UWU (Exhibit UWU-4), such emails, dated 21 and 22 October 2015, concern the payment of allowances for attendance at training in Canberra, i.e. they do not concern International or Domestic Travel and/or Escort events. 18
Cross-examination of witnesses
[17] Neither Mr Vance, nor Mr Hugo were cross-examined. Both Mr Koschel and Mr Graham were briefly cross-examined. Having reviewed the transcript, I do not consider that the cross-examination of Mr Koschel or Mr Graham in any way altered their evidence in-chief.
UWU’s submissions
[18] The substance of the UWU’s submissions, as to the interaction between clauses 19(e)(iii) and 19(e)(iv), are as follows:
(a) “Clauses 19(e)(iv) and 19(m)(I) of the Agreement have an equivalent meaning that are intended to capture the same circumstances, with clause 19(m)(I) explicitly referring to clause 19(e)(iv). However, whilst this might be uncontroversial, it does not mean that the terms of these clauses, and/or their interaction with clause 19(e)(iii), are unambiguous.” 19
(b) “[C]lauses [19(e)(iv) and 19(m)(I)] operate to exclude the operation of clause 19(e)(iii) only for each night he/she (the employee) is away from home and not the entire period of travel. As a consequence, the employee’s travel for the return leg of the trip – travel which is away from the employee’s normal place of work but does not require an overnight stay – is travel under clause 19(e)(iii) of the Agreement. There is also nothing in the Agreement which suggests a combination cannot apply in relation to a single instance of travel. The clauses explicitly attach the payment of the travel allowance – to the exclusion of the meal allowance - to each night the employee is away from home and not to the entire period of travel. The sentence should not be understood, as Serco contends, as referring to all meals during the travel but instead understood in its textual context.” 20
(c) “[C]lause 19(e)(iv) and clause 19(e)(iii) can, as a general proposition, apply to the same instance of travel (e.g. day 1 and day 2 of a travel requiring an overnight stay). Relevantly, clause 19(e)(iv) states, “the Employee will be paid domestic allowance expenses of [the relevant sum] for each night he/she is away from home. This amount covers the cost of all meals. Accordingly, the travelling meal allowance in 19(e)(iii) will not apply”. Therefore the UWU submits clause 19(e)(iv) should be understood to only replace the meal allowance where meals are actually covered (…for each night he/she is away from home…) and not where they are not. The extension of this is that because the clause 19(e)(iv) domestic travel allowance is only paid for each night the employee is away – and explicitly covers the cost of all meals when paid – clause 19(e)(iv) can only be said to (sic) good (sic) to replace or ouster clause 19(e)(iii) for each night the domestic travel allowance is paid and meals for the period are covered. Clause 19(e)(iii) then logically comes back into operation for the remainder of the trip because the domestic travel allowance is not paid in relation to the last day of travel. This is because on the last day of travel clause 19(e)(iv) is no longer doing any work, the cost of meals is no longer covered.” 21
(d) [In respect of the articulated question before the Commission] “a combination of (a) and (b) applied in relation to the international escorts [undertaken by Mr Koschel as set out in Annexure A to the articulated question]. The practical effect of this interpretation is [that] the meal allowance at clause 19(e)(iii) [of the Agreement] is payable to Koschel for the following periods:
a. 12.00am to 8.45am on 3 February 2019;
b. 12.00am to 12.15pm on 24 October 2019;
c. 12.00am to 3.30pm on 26 November 2019; and
d. 12.00am to 10.00am on 19 January 2020.” 22
(e) “the Commission should find that in the circumstances of Mr Koschel, with respect to the International Escorts completed and set out at Annexure A, Mr Koschel, at all times was travelling in accordance with a combination of clauses 19(e)(iv) and 19(m)(I), and clause 19(e)(iii).” 23
[19] The UWU also advanced the following propositions and arguments:
(a) There is ambiguity as to the meaning and interaction of clauses 19(e)(iii), 19(e)(iv) and 19(m)(I) of the Agreement. 24 In this regard:
“While it should be uncontroversial that clauses 19(e)(iv) and 19(m)(I) are equivalent clauses designed to capture the same circumstances, this does not mean the clauses are not ambiguous, in the sense [that] it is not clear as to what exactly the travel allowance at clause 19(e)iv) attaches (i.e. the travel, or the overnight stay) and to at what degree the meal allowance at clause 19(e)(iii) is excluded.” 25
(b) Viewed as a whole, by reference to the common intention of the parties who made the Agreement:
“[C]lause 19(m)(I) must be understood within the text of the Agreement as a whole and with a view to the clause’s placement within the 2018 Agreement. It should not be controversial that the effect of clause 19(m)(I) is to confirm the domestic travel allowance set out in clause 19(e)(iv) applies in the circumstances of employees performing “escorts requiring an overnight stay”. To put it another way, clause 19(m)(I) does not set out a different or separate allowance, it incorporates the existing domestic travel allowance at clause 19(e)(iv) into the circumstances described at clause 19(m)(I), being escorts requiring an overnight stay. Clause 19(m)(I) is subservient to clause 19(e)(iv) because it has clause 19(e)(iv) built into it. It is for this reason [that] the UWU submits [that] a reasonable person would understand 19(e)(iv) as needing to operate in a consistent manner across the whole of 2018 Agreement, including where it is incorporated into the context of international escort work at clause 19(m)(I).” 26
(c) The proposition that, by virtue of the words of clause 19(m)(I), clause 19(e)(iv) interacts and operates radically differently with clause 19(e)(iii), is to construe (erroneously) clause 19(m)(I) of the Agreement in isolation. Clause 19(m)(I) simply attaches the entitlement to the Overnight Allowance (under clause 19(e)(iv)) to a different circumstance. In this regard:
“[C]lause 19(m)(I) does not set out an entitlement to a new allowance it simply attaches an existing allowance (the domestic travel allowance), to a different circumstance (escorts requiring an overnight stay). If the Commission accepts the need for clause 19(e)(iv) to operate consistently across the Agreement, it follows that for clause 19(m)(I) to interact with clause 19(e)(iii) differently to clause 19(e)(iv), as Serco contends, this produces an absurd result, a result which is not consistent with the text when viewed as a whole. The result is absurd because, under Serco’s interpretation, the meal allowance apparently is paid on the final day of travel requiring an overnight stay where there is no escort (e.g. day 2 of interstate travel to attend training events), but not enlivened where an escort requiring an overnight stay is performed. Given it is the same travel allowance interacting with the same meal allowance, this interpretation cannot be correct. If the final day of overnight non-escort travel enlivens the meal allowances at clause 19(e)(iii), the UWU submits the same must be true when applied during an escort requiring an overnight stay. The final sentence of clause 19(m)(I) should therefore be understood as simply reiterating clause 19(e)(iv) operates in its normal way, where clause 19(e)(iv) covers the cost of meals clause 19(e)(iii) does not apply - but only to the point the meals are indeed covered.” 27
(d) On the issue of whether or not an aircraft carrier provides meals (e.g. onboard food and beverages), or a hotel provides breakfast as part of an accommodation package, the UWU submits:
“It was put to Mr Koschel at the hearing that he was offered food and beverage on the aeroplane during the four escorts in Annexure A and Mr Koschel confirmed this was the case. Mr Koschel also confirmed that during the four escorts he purchased additional food and beverage items (i.e. beyond what was provided during the flights). Mr Hugo put forward similar evidence to Mr Koschel on this issue, stating:
‘Sometimes a hotel includes breakfast in the charge for the room. Otherwise I purchase my meals from restaurants and other retail outlets if we are in accommodation. Other DSOs I have worked with do that same. Sometimes we are on a flight with ex gratia meals and I generally eat those.’” 28
(e) The purpose of the Overnight Allowance and the meal allowances is to cover the “disability” associated with an employee’s inability to consume homemade meals on the second day of travel (i.e. on the return to home/work leg of an escort). Further, these allowances have the purpose of seeking to compensate an employee for meals that they (themselves) needed to purchase during travel or transit. 29
(f) Clauses 19(e)(iv) and 19(m)(I) of the Agreement:
(i) “operate to exclude the operation of clause 19(e)(iii) only for each night he/she (the employee) is away from home and not the entire period of travel. As a consequence, the employee’s travel for the return leg of the trip – travel which is away from the employee’s normal place of work but does not require an overnight stay – is travel under clause 19(e)(iii) of the Agreement. There is also nothing in the Agreement which suggests a combination cannot apply in relation to a single instance of travel”; 30 and
(ii) “explicitly attach the payment of the [Overnight Allowance] – to the exclusion of the meal allowance - to each night the employee is away from home and not to the entire period of travel. The sentence should not be understood, as [the Respondent] contends, as referring to all meals during the travel but instead understood in its textual context.” 31
(g) The words “leaving” and “arriving” in clause 19(e)(iii) have an open ended and general meaning. 32 As I understand it, the UWU submits that these terms may be readily applied to leaving and arriving in respect of an overnight escort (e.g. arriving back to work after an overnight stay), and/or apply during an International Escort (i.e. on the second day of an overnight stay).
(h) Up until mid-December 2015, the Respondent routinely paid the meal allowance under the applicable predecessor enterprise agreement (pursuant to clauses in the same terms as clauses 19(e)(iii) and 19(e)(iv) of the Agreement) 33 in relation to the final day of an escort that required an overnight stay (i.e. in addition to an overnight allowance payable under the predecessor enterprise agreement). This is supported on the evidence. The evidence further discloses that employees were not consulted with, or otherwise advised, as to the Respondent’s decision to cease paying the meal allowances (on the final day of a trip) for employees in receipt of the Overnight Allowance. This demonstrates a change in position by the Respondent, being a change from what was previously a shared interpretation.34
(i) Adopting the interpretation advanced by the Respondent would be inconsistent with the intended purpose of each of the meal and overnight allowances, and result in an unjust outcome. For example, on the Respondent’s interpretation, an employee who departs from an overnight stay at 4.00am one morning, and arrives back in Sydney that same evening at 10.00pm, would not be entitled to any meal allowances, or a further Overnight Allowance. 35
Respondent’s submissions
[20] The Respondent submits 36 that the dispute in this matter is to be resolved as follows:
(a) By reference to each of the Four Escorts (the subject of these dispute proceedings) Mr Koschel was:
“‘travelling’ under the instruction of (Serco) in accordance with clause 19(e)(iv) and clause 19(m}(i) of the Serco Immigration Services Enterprise Agreement 2018”
and that in the context of any individual “Escort” the Agreement does not permit “a combination” of (a) or (b) (of the Articulated Question). Subclause l9(e)(iii) of the Agreement, in the context of the Four Escorts, is not engaged. 37
(b) Clause 19(e)(iv) of the Agreement is engaged in respect of each of the Four Escorts undertaken by Mr Koschel. Clause 19(m) expressly states that clause 19(e)(iii) does not apply when clause 19(e)(iv) applies. 38
(c) Given that clause 19(e)(iii) specifically excludes an escort who “does not require” an overnight stay, if an escort does require an overnight stay, there can be no entitlement to the separate breakfast, lunch, dinner and evening allowances. 39
(d) “An “International Escort” involves the [relevant DSO] applying for and accepting a temporary assignment to “escort” to a foreign country a person who is no longer permitted to remain in Australia (the Detainee). An International Escort:
(i) starts at the point at which the DSO leaves the [Respondent’s] Site [in this case the VIDC] with the Detainee to travel to the international point of departure from Australia; and
(ii) concludes when the DSO arrives back at the [VIDC] to debrief and return Serco equipment (known as the debrief).
This fact was conceded by Mr Koschel in cross examination. [Transcript PN 54, 59, 60, 61, 69 and 77].” 40
(e) Clause 19(e)(iii) of the Agreement can have no application to the Four Escorts as it would be impossible for Mr Koschel, on such an escort, to leave from his “normal place of work” on a day which immediately follows any overnight flight. Clause 19(e)(iv) of the Agreement is engaged where the overnight stay occurs. The employee is paid the sum of $109.541 for each night that he or she is away from home. To make this clear, the same clause states that the amount of $109.54 covers the cost of “all meals”. To reinforce the issue, clause 19(e)(iv) specifically states that the travelling meal allowances in clause 19(e)(iii) and the overtime meal allowance in clause 19(b) will not apply. 41
(f) “The practical effect of the [Agreement] provisions may be summarised as follows and with reference to the particular “day” of any escort:
(i) if the escort does not involve an overnight stay, the employee assisting Serco in the escort on the day of the Escort is reimbursed for meals in accordance with the "travelling meal allowances" with reference to clause 19(e)(iii). As such:
• •f he or she leaves before 6.00 am from their “normal place of work” and arrives back at their “normal place of work” after 8.00 am, he or she has not been involved in an escort that required an “overnight stay” he/she receives the Breakfast Allowance;
• if he or she leaves before 11.00 am from their “normal place of work” and arrives back at their “normal place of work” after 1.00 pm, he or she has not been involved in an escort that required an “overnight stay” and he/she receives the Lunch Allowance;
• if he or she leaves before 6.00 pm from their “normal place of work” and arrives back at their “normal place of work” after 8.00 pm, he or she has not been involved in an escort that “required an overnight stay” and he/she receives the Dinner Allowance; and
• if he or she leaves before 11.00 pm from their “normal place of work” and arrives back at their “normal place of work” after 1.00 am, he or she has not been involved in an escort that required an “overnight stay” and he/she receives the Evening Allowance.
(ii) on no occasion on any of the Four Escorts did Mr Koschel leave from his “normal place of work” (VIDC) on the day which is referred to in the Applicant Union's Submissions (that being the day that immediately follows the overnight international flight);
(iii) subclause 19(e)(iii) of the [Agreement] can have no application to an International Escort as it would be impossible for the employee on such an escort to leave from their “normal place of work” on a day which immediately follows an overnight flight;
(iv) if the escort does involve an overnight stay, then there is no reference to the relevant leaving and arriving back times on the day as set out in clause 19(e)(iii). In lieu, clause l9(e)(iv) of the [Agreement] is engaged and the employee is paid the sum of $109.541 for each night that he or she is away from home. To make this clear, the same clause states that the amount of $109.54 covers the cost of “all meals”. To reinforce the issue, subclause 19(e)(iv) specifically states that the travelling meal allowances in subclause 19(e)(iii) and the overtime meal allowance in subclause 19(b) will not apply.” 42
(g) By reference to the principles summarised in Berri:
(i) Principle 7 states that 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. Serco submits that, with reference to the Articulated Questions, the meaning of the [Agreement] is plain. There is no ambiguity. There are no facts and circumstances or interpretation that would suggest that the Agreement is susceptible to more than one meaning. The only surrounding circumstances that the Applicant Union appears to rely upon is:
• anecdotal evidence of alleged payment of the singular allowances prior to 2015; and
• perceived silence on the part of Serco with respect to its interpretation of the relevant clauses in and around the making of the [Agreement].
(ii) none of these alleged “surrounding circumstances” suggests any ambiguity in the ordinary or plain meaning of [the Agreement].
(iii) Principles 8 and 9 state that regard may only be had to evidence and surrounding circumstances to assist in whether any ambiguity exists, however, if the agreement has plain meaning, evidence of the surrounding circumstances will not be admitted to contradict the plain language of the agreement.
(iv) the evidence relied upon by the Applicant Union may well go to the Applicant Union's subjective intentions and/or may come as a disappointment to the Applicant Union, however, Principle 2 states that the task of interpreting an agreement does not involve re-writing the agreement to achieve what may be regarded as a fair or just outcome. The task is always one of interpreting the agreement produced by the parties.
(v) whilst Serco submits that any reference to the facts and circumstances of the negotiation of a previous enterprise agreement in 2015 would be of little assistance to the Commission, Principles 11 and 12 are relevant to the Commission's consideration and provide as follows:
“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 of which knowledge is to be presumed; and
(iii) evidence of matters in common contemplation and constituting a common assumption.”
(vi) in this case, it would appear to be at its highest a suggestion as to what the employees were not told by Serco in 2015. This issue, if relevant to the Four Escorts, is dealt with at Principles 13, 14 and 15 as follows:
“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.” 43
(h) In response to the UWU’s submissions generally, the Respondent states:
“It is the submission of the Respondent that the Applicant Union’s case fails first and foremost on the finding that there is no ambiguity that would otherwise permit the Commission to attempt to interpret the Enterprise Agreement in a manner that results in the allowances being paid in the context of an International Escort that required an overnight stay. The alternative submission appears to be that the final day of the Escort should now be regarded as a passage of time that is separate and distinct from the International Escort itself. This conclusion is simply not available to the Commission on the plain text of the document and, in the submission of the Respondent, fails to grapple with both the evidence and the content of the industrial instrument as to what constitutes an “Escort”. Mr Koschel, in cross examination, accepted that in the case of each of the Four Escorts, the International Escort finished at the time that he arrived back at VIDC and conducted the debrief and returned [the Respondent’s] property.” 44
UWU reply submissions
[21] The UWU’s reply submissions join issue with the Respondent’s arguments. 45
Consideration
[22] In my view, the context and evident purpose of clauses 19(e)(iii), 19(e)(iv) and 19(m) of the Agreement are to differentiate between the respective allowances payable to employees “travelling under the instructions of the Company”, based upon whether the travel involves or does not involve an “overnight stay”, domestically or internationally.
[23] The UWU’s interpretation of these clauses is inconsistent with the ordinary and natural meaning of the words:
(a) “does not require an overnight stay” (clause 19(e)(iii);
(b) “This amount covers the cost of all meals. Accordingly, the traveling meal allowance in 19(e)(iii) and the overtime meal allowance in clause 19(b) will not apply.” (clause 19(e)(iv)); and
(c) “This amount covers the cost of all meals. Meal allowances in clause 19(b) and 19(e)(iii) will not apply.” (clause 19(m)(I)).
[24] The foregoing words represent unambiguous qualifying exclusionary language. They are specific and significant words, that must be applied so as to reflect their manifest (exclusionary) meaning. In my view, the contention that clause 19(e)(iii) can apply to an employee in receipt of an Overnight Allowance is unable to be reconciled with the foregoing words of clauses 19(e)(iv) and 19(m)(I).
[25] The UWU’s interpretation of these clauses essentially relies upon the insertion of new words, or qualifying language, that cannot be reconciled with the ordinary and natural meaning of the exclusionary words of the clauses. In this regard, the UWU’s interpretation would require that the Overnight Allowance have a specific time limit or end point, at which time clause 19(e)(iii) would apply, notwithstanding that an overnight stay has occurred the night before. Further, such an interpretation would require the words “leaving” and “arriving” to be characterised (and construed) contrary to the facts applying during an International Escort (i.e. an Internal Escort commences when the DSO leaves the VIDC, and ends when he/she returns to the VIDC). A DSO undertaking an Domestic or International Escort does not:
(a) leave and/or arrive at specific (or different) points in time throughout or during the period of an escort; or
(b) leave and/or arrive at their “normal place of work” whilst travelling during an escort, or whilst otherwise waiting to return to their normal place of work at the conclusion of an escort (to return property and debrief). 46
[26] The UWU’s approach to the interpretation of clauses 19(e)(iii), 19(e)(iv) and 19(m) of the Agreement is very much contrary to principles of interpretation set out in Berri. Rather, I accept and concur with the submissions of the Respondent as to the application of the principles in Berri to this dispute (as set out at paragraph [20(g)] of this decision).
[27] In my view, a construction of clauses 19(e)(iii), 19(e)(iv) and 19(m) of the Agreement that gives proper effect to the exclusionary words extracted at paragraph [23] of this decision does not contradict any of the other express words of these clauses, and gives these clauses a meaning which is in harmony with their context and evident stated purpose under the Agreement.
[28] I note that the UWU has sought to rely upon the evidence of Mr Vance, Mr Hugo, Mr Koschel and the emails contained in Exhibit UWU-4 as advancing its arguments as to ambiguity, common intention, and the construction of clauses 19(e)(iii), 19(e)(iv) and 19(m) of the Agreement. Given my findings as to the ordinary and natural meaning of the words of these clauses, and the absence of ambiguity, I do not consider such evidence to be useful for the purposes of the resolution of these proceedings.
[29] However, even if I am wrong as to the absence of ambiguity, I have also given consideration to the resolution of such ambiguity in the Agreement, having regard to the evidence before me. In this regard, I am not persuaded by the arguments advanced by the UWU based upon such evidence. In short, the admissible extrinsic evidence of the surrounding circumstances in these proceedings is of limited assistance. There is no evidence regarding the negotiation of the Agreement and what, if anything, the employees covered by the Agreement were told about the meaning of the clauses in dispute. More specifically, there is no evidence of the explanation provided to the relevant employees, pursuant to s.180(5) of the Act, of the terms of the Agreement and the effect of those terms. Mr Vance’s evidence as to his discussions with Mr Graham in relation to the negotiation of 2015 Agreement occurred after the relevant bargaining meeting had finished, and was a discussion of no more than 10 seconds, conducted as Mr Vance was walking out the door. The substance of that conversation identifies no common understanding. The explanation document annexed to Mr Vance’s witness statement does not refer to the effect of the meal or overnight allowances. Mr Hugo’s evidence does not concern the Four Escorts, and Mr Koschel’s evidence is based upon his recollection and belief, but is unsupported by documentary evidence. The summary is that the evidence relied upon by the UWU in these proceedings does not put me in a position to make relevant findings that would contradict the plain and ordinary meanings of the clauses in issue; objectively identify background facts known to both parties; highlight matters in common contemplation and constituting a common assumption; or otherwise aide in the interpretation of these clauses.
Disposal of proceedings
[30] I answer the Articulated Question in these proceedings as follows:
“In the circumstances of Mr Koschel, VIDC DSO, with respect to the International Escorts completed by him and set out at Annexure A (being the Four Escorts)), was Mr Koschel, at all relevant times:
(a) “travelling” under the instruction of the Respondent in accordance with clause 19(e)(iii) of the Agreement, or
Answer: No. Mr Koschel, in relation to each of the Four Escorts, based upon the evidence, and having regard to my findings as to the proper construction of clauses 19(e)(iii), 19(e)(iv) and 19(m) of the Agreement (as set out in this decision) was not “travelling” under the instruction of the Respondent in accordance with clause 19(e)(iii) of the Agreement.
(b) “travelling” under the instruction of the Respondent in accordance with clauses 19(e)(iv) and 19(m)(I) of the Agreement, or
Answer: Yes. Mr Koschel, in relation to each of the Four Escorts, based upon the evidence, and having regard to my findings as to the proper construction of clauses 19(e)(iii), 19(e)(iv) and 19(m) of the Agreement (as set out in this decision) was “travelling” under the instruction of the Respondent in accordance with clauses 19(m)(I) and 19(e)(iv) of the Agreement.
(c) a combination of (a) and (b) above, to the extent any combination may be held to be applicable to each International Escort.”
Answer: No. Based upon the evidence, and having regard to my findings as to the proper construction of clauses 19(e)(iii), 19(e)(iv) and 19(m) of the Agreement (as set out in this decision), there was no “combination of (a) and (b) above” that applied in relation to each of the Four Escorts undertaken by Mr Koschel (i.e. only (b) applied).
[31] This dispute application is otherwise dismissed. An Order to this effect will issue separately to this decision.
DEPUTY PRESIDENT
Appearances:
Mr Tom Whiteside, Industrial Officer, and Mr Justin Davis, Industrial Officer, appeared for the United Workers Union (Applicant).
Mr Paul Brown, Partner, Baker McKenzie lawyers, instructed by Ms Lisa Tran, Serco Senior Legal Counsel, appeared with permission for Serco Australia Pty Ltd T/A Serco (Respondent).
Printed by authority of the Commonwealth Government Printer
<PR731513>
1 [2018] FWCA 7046, AE500783, PR702386, 16 November 2018, McKenna C.
2 See summary in UWU Opening Submissions, 26 March 2021, at [6]-[14].
3 Permission for the Respondent to be legally represented was not opposed. I granted the Respondent permission to be legally represented generally in this matter. I did so having had regard to the criteria in s.596 of the Fair Work Act 2009, specifically noting that the issues in this matter are complex as they concern the proper construction of the terms of an enterprise agreement, with my view that the matter would be conducted more efficiently with the assistance of an external legal representative on behalf of Respondent (s.596(2)(a)).
4 Respondent’s Outline of Submissions, 9 April 2021, at [2]-[3].
5 Ibid at [6]. The “domestic travel allowance” is used for overnight stays involving domestic escorts (clause 19(e)(iv)), and for international escorts (clause 19(m)(I), referring back to clause 19(e)(iv)).
6 Recorded on employee payslips as “[number] per diems”.
7 Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers Union v Berri Pty Ltd[2017] FWCFB 3005 (especially at [114]). See also AMIEU v Golden Cockerel Pty Ltd [2014] FWCFB 7447, at [19]-[41]; WorkPac Pty Ltd v Skene [2018] FCAFC 131, 264 FCR 536, at [197].
8 [2020] FWC 2130.
9 Ibid at [8].
10 See clause 19(r)(i) of the Agreement.
11 Exhibit UWU-4.
12 Exhibit UWU-1 (Mr Vance Statement, 26 March 2021).
13 Exhibit UWU-2 (Mr Hugo Statement, 23 March 2021); Exhibit UWU-3 (Mr Koschel Statement, 25 March 2021).
14 Exhibit Serco-1, Mr Graham Statement, 9 April 2021, at [20].
15 Ibid at [4].
16 Ibid at [13]-[16].
17 Ibid at [18].
18 Exhibit Serco-2, Mr Graham Additional Statement, 22 April 2021, at [5(c)]-[7]. It is noted that Mr Graham was not cross-examined on the 20 October 2015 email contained in Exhibit UWU-4.
19 UWU Opening Submissions, 26 March 2021, at [30]-[33].
20 UWU Opening Submissions, 26 March 2021, at [40]-[41], see also at [42]-[44].
21 UWU Closing Submissions, 10 May 2021, at [19], noting also [[18] and [20]-[22]. See also UWU Opening Submissions, 26 March 2021, at [34]-[38], concerning the UWU’s submissions as to the meaning of the terms “travel” and “travelling under instruction”.
22 UWU Opening Submissions, 26 March 2021, at [23].
23 UWU Opening Submissions, 26 March 2021, at [58].
24 Ibid at [35]; UWU Closing Submissions, 10 May 2021, at [6]-[14].
25 UWU Opening Submissions, 26 March 2021, at [33].
26 UWU Closing Submissions, 10 May 2021, at [17], noting also [15] and [16].
27 Ibid at [24] (footnote omitted), noting also [23].
28 Ibid at [26] (footnotes omitted).
29 Ibid at [27].
30 UWU Opening Submissions, 26 March 2021, at [40].
31 Ibid at [41].
32 UWU Closing Submissions, 10 May 2021, at [28]-[30].
33 See 2015 Agreement; UWU Opening Submissions, 26 March 2021, at [48]-[53]. Note the differences between the 2015 Agreement and the 2018 Agreement as identified in the Graham Additional Statement, 22 April 2021, at [5(b)].
34 UWU Closing Submissions, 10 May 2021, at [31]-[38] (The UWU submits that this makes the UWU’s interpretation more “plausible”). See also UWU Opening Submissions, 26 March 2021, at [54]-[57].
35 UWU Opening Submissions, 26 March 2021, at [45].
36 I note that many of the Respondent’s Final Submissions (17 May 2021) repeat or reiterate those contained in the Respondent’s Outline of Submissions (9 April 2021).
37 Respondent’s Outline of Submissions, 9 April 2021, at [5]. See also at [27].
38 Ibid at [11]-[14].
39 Ibid at [16].
40 Ibid at [17].
41 Respondent’s Final Submissions, 17 May 2021, at [31]-[32].
42 Respondent’s Outline of Submissions, 9 April 2021, at [19].
43 Respondent’s Outline of Submissions, 9 April 2021, at [25].
44 Respondent’s Final Submissions, 17 May 2021, at [46].
45 See UWU Reply Submissions, 16 April 2021, and UWU Reply Submissions, 24 May 2021.
46 As Wheelan J has pointed out in King v Melbourne Swimming Club Inc 2020 FCA 1173 (at 140), the construction of the words in an industrial instrument requires more than taking the text of the instrument in one hand, and a dictionary in the other.
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