Victoria Police

Case •

[2015] FWCA 5109

•

6 AUGUST 2015

No judgment structure available for this case.
[2015] FWCA 5109
FAIR WORK COMMISSION

DECISION


Fair Work Act 2009
s.217 - Application to vary an agreement to remove an ambiguity or uncertainty

Victoria Police
(AG2014/8528)

VICTORIA POLICE FORCE ENTERPRISE AGREEMENT 2011

State and Territory government administration

COMMISSIONER WILSON

MELBOURNE, 6 AUGUST 2015

Application for variation of the Victoria Police Force Enterprise Agreement 2011.

[1] There are two applications before the Commission in respect of related matters associated with the Victoria Police Force Enterprise Agreement 2011 1 (the 2011 Agreement).

[2] The first of the applications was made by the Police Federation of Australia, Victoria Police Branch (the Police Federation) on 16 May 2014. That application, C2014/831 (referred to as the Police Federation application), was made pursuant to s.739 of the Fair Work Act 2009 (the Act) and sought resolution of an alleged dispute relating to accommodation at Mt Buller during the 2014 snow season, with the nature of the dispute going to a question of whether shared accommodation as arranged by Victoria Police was adequate accommodation within the meaning of the 2011 Agreement.

[3] The second of the applications, AG2014/8528 (the Victoria Police Application), was made by Victoria Police pursuant to s.217 of the Act and sought the insertion into the above enterprise agreement of a new clause aimed at clarifying entitlements for accommodation. The Victoria Police Application was made on 5 August 2014, after an initial decision by Deputy President Smith on the Police Federation Application. The Victoria Police Application seeks the insertion of a new clause that would clarify that the “Bed” allowance provided for in Schedule C of the agreement should only be paid when Victoria Police does not arrange accommodation for an employee and the employee incurs the cost of that accommodation.

[4] The context to the applications before the Commission is that the Police Federation Application was partially dealt with by Deputy President Smith in the course of a decision given by him in June 2014. 2 That decision found that the share accommodation Victoria Police provided to employees posted to Mt Buller during the 2014 winter ski season was not “adequate accommodation” within the meaning of the existing clause 71.5 and that as a consequence, an inadequate accommodation allowance of $31.67 was payable for each night of the posting. The finding by the Commission about what was “inadequate accommodation” gives rise to the possibility that the 2011 Agreement should be construed as entitling an employee not only to payment of an allowance because they have been accommodated in inadequate accommodation, but also to the Bed allowance.

[5] By way of background, during the 2014 winter ski season certain employees were required to be temporarily located at Mount Buller. In April 2014, the Police Association put the view to the Victoria Police that, for reason of the provisions of the 2011 Agreement, overnight accommodation should be at a “single room three-star, motel-style” standard. Victoria Police rejected that view and argued that a shared apartment with separate bedroom and bathroom facilities complied with the requirements of the agreement about “adequate accommodation”.

[6] Clause 71 of the 2011 Agreement deals with overnight meal and accommodation allowances. Clause 71.1 provides that an employee is entitled to payment for meals, accommodation and incidental expenses for an overnight stay, with the allowances to be in accordance with Schedule C of the agreement; clause 71.2 sets forward a period of time for which certain meal allowances are payable; and clause 71.3 provides for the circumstance of when meals are purchased travelling to and from overnight accommodation. In resolving the matter that was argued before him, Deputy President Smith considered the construction of clause 71.5, which deals with the circumstances of an entitlement to “incidentals” payments, and clause 71.6 which provides for an inadequate accommodation allowance.

[7] The whole of the clause, together with the relevant part of Schedule C, is set out below;

    “71. Overnight Meal and Accommodation Allowance

    71.1. An employee who travels in the course of their duty and is required by the employer to stay overnight is entitled to be paid allowances for meals, accommodation and incidental expenses in accordance with Schedule C.

    71.2. An employee is entitled to be paid an allowance for breakfast, lunch or dinner where the employee commences travelling earlier than or returns later than the following times:

    Time of Leaving

    Time of Returning

    Breakfast

    0700 hours

    0830 hours

    Lunch

    1200 hours

    1400 hours

    Dinner

    1800 hours

    1900 hours

    71.3. Where a meal is purchased whilst travelling to and from overnight accommodation, the meal allowances are payable at the rate applicable to where the overnight accommodation is taken.

    71.4. Payment of incidentals will only be made for each night of accommodation.

    71.5. The employee will still be entitled to receive the incidentals portion of the allowance paid under sub-clause 71.1 where:

      (a) the employer provides adequate accommodation (i.e. of at least three star single motel room standard) and the employee is not entitled to payment of an allowance in relation to the accommodation provided; or

      (b) the employer provides adequate meals, and the employee is not entitled to payment for an allowance in relation to the meals provided; or

      (c) the employee travels by air, boat, rail or other facility, and/or sleeping accommodation is provided and charged for in the fare, and they are not entitled to receive the corresponding expenses prescribed in this clause.

    71.6. Where the employee is required to share accommodation or facilities, with the exception of the Victoria Police Academy, they will be paid an inadequate accommodation allowance as prescribed in Schedule C.”

    Schedule C- Expense Related Allowances

    Clause

    Number

    Expense Related Allowance

    1-Dec-11

    1-Jul-12

    1-Jul-13

    1-Jul-14

    ...

    71.1

    73.1 (a)

    74.1

    77.2

    Meal/Incidental Allowance - Overnight

    $ 20.06

    $ 20.67

    $21.29

    $ 21.92

    Breakfast

    $ 34.09

    $ 35.12

    $ 36.17

    $ 37.25

    Lunch

    $ 48.04

    $ 49.48

    $ 50.96

    $ 52.49

    Bed

    $ 147.53

    $ 151.95

    $ 156.51

    $ 161.21

    Incidentals

    $ 18.88

    $ 19.45

    $ 20.03

    $ 20.63

    $ -

    $ -

    $ -

    $ -

    71.6

    Inadequate Accommodation Allowance

    $ 28.98

    $ 29.85

    $ 30.75

    $ 31.67

[8] In his decision, Deputy President Smith made following findings about clause 71;

    “[3] I have examined clauses 71, 71.5 and 71.6 of the Victoria Police Force Enterprise Agreement 2011 (the Agreement). I am satisfied that clause 71 does not create an entitlement to accommodation, it creates an entitlement to allowances, and 71.5 creates an entitlement to certain allowances in certain circumstances. Therefore I can now turn to clause 71.6. It reads:

      Where an employee is required to share accommodation or facilities, with the exception of the Victoria Police Academy, they will be paid an inadequate accommodation allowance as prescribed by Schedule C.

    [4] If one looks at the relationship between clauses 71.5(a), which describes “adequate”, and 71.6 which uses the term “inadequate”, it is seen that these two are linked. Accordingly, it is appropriate to examine the history and context of what 71.5(a) seeks to address. Adequate accommodation in clause 71.5 is referred to and then in brackets (ie: of at least 3 star single motel room standard). I am asked by Victoria Police to focus on the word “adequate’ rather than those words in brackets, and simply translate the words “3 star single room motel standard”, and conclude that the provision of accommodation is adequate given that they say it is better than three star single room motel standard.

    [5] I am not persuaded to take this course. I examined the history of the matter and it is clear from the history of the matter, and in this connection I turn to the letter of Acting Commander Peter Bull written on 11 February 2003, which addresses motel accommodation. The second paragraph states:

      Victoria Police restates its position on motel accommodation that where members are required to travel away overnight, they will use contracted motel accommodation wherever possible and that all accommodation shall be of a good commercial standard of at least 3 star and provides for single room occupancy with private facilities.

    [6] The letter uses the word “and” between reference to 3 star accommodation and single room occupancy.

    [7] Given the context of that letter and the history of the dispute which gave rise to the provisions under the Agreement, I do not see the use of the phrase in brackets as being a general standard of which one must determine whether it is adequate or not. It must be read consistent with its history. In my view, accommodation must be of at least 3 star and have single room occupancy with private facilities. This then means that one looks at clause 71.6 and seeks to see whether or not the accommodation that is sought to be provided for the snow season at Mount Buller is adequate. It is not single room accommodation and therefore, in my view, it fails the test of adequacy. I am not persuaded that it is not of three star, but I do hold the view that because it does not provide for single room occupancy with private facilities, then it is inadequate accommodation in terms of the agreement of the parties.

    [8] I now turn to the occupational health and safety matters. I am asked to examine these in two ways. The first by Victoria Police (VicPol) where I am asked to examine them in the way which it looks at the broader concerns of occupational health and safety: namely the adequacy of the accommodation, the cleanliness of the accommodation, other matters which go to the physical location and capacity of the accommodation. In relation to the evidence from the Police Federation of Australia (PFA), I am asked to examine issues going to fatigue, personal habits, preferences and attitudes of persons with whom they may be required to share.

    [9] In relation to the submission by PFA, it is my view that those sorts of occupational health and safety matters are better dealt with at first instance internally and that the approach of Acting Inspector Byers is the correct one, to look broadly at the nature of the accommodation and then deal with personal matters on a case by case approach.

    [10] This means in conclusion, that I find that clause 71 does not create an entitlement for a particular level of accommodation. I find that clause 71.6 does require the payment of an inadequate accommodation allowance as prescribed in Schedule C where and on the facts before me, and using the tests under 71.5(a) and the history of that provision, I find that the accommodation in Mount Buller for this occasion is inadequate.” 3

[9] The Deputy President then turned to the question of the meaning of the phrase “Where an employee is required”, and decided;

    “[12] The PFA argue that the focus should be whether or not there was available accommodation of the relevant standard. If this was the case then inadequate accommodation was not required.

    [13] VicPol argue that the phrase sits more comfortably with where the employer requires a police member to occupy a particular type of accommodation. In my view this understanding is preferred. In the result, for operational or other reasons, the employer may require members of VicPol to locate themselves in a particular venue.” 4

[10] I respectfully concur with these findings. It is to be noted of course that the approach taken by Deputy President Smith focuses upon the entitlement to allowances of an individual police officer rather than the matter as originally characterised by the Police Federation in its originating application, which was to seek an order about the standard of accommodation to be provided to officers and in particular that they could be provided with “single-room three star motel style standard” accommodation.

[11] In proper context I do not view Deputy President Smith as having found that the accommodation was “inadequate” in the sense of it being inappropriate or unsatisfactory, or otherwise not to a fit or proper standard; but rather that the circumstances of the accommodation was such that it met the definition of “inadequate accommodation”.

[12] The dispute between the parties in these matters arises because of the interaction between the clauses referred to above and Schedule C of the 2011 Agreement.

[13] As referred to above, Schedule C provides for a Bed allowance which has been the amount of $161.21 since 1 July 2014.

[14] The way the schedule is written indicates that the Bed allowance, and other allowances grouped in the same row of the table, may be payable pursuant to the circumstances of three clauses in addition to clause 71.1; namely clauses 73.1(a), 74.1 and 77.2. Consideration of those clauses shows that;

  • the reference to clause 73.1(a) appears to have no relevance to the matters in consideration in this decision, because that clause relates only to the payment of an incidental allowance for each overnight stay;


  • clause 74.1 is in similar terms to clause 71.1 providing for payment of “accommodation, meals and incidental allowances in accordance with Schedule C” in connection with temporary work at holiday resort locations; and


  • the reference to clause 77.2 appears to have no relevance to the matters in consideration in this decision, because that clause refers only to the payment of meal allowances to employees not provided with meals when camping out.


[15] There is a dispute between the parties about whether and how clause 71 provides for payment of the Bed allowance provided in Schedule C.

[16] Victoria Police submit that the intention of clause 71 is to provide for a scheme of payments to be made to employees, which, in essence, are only payable if the benefit has not been provided to the employee at the expense of Victoria Police. In substance, Victoria Police submits that “the mutual intention of the parties was that the Bed allowance be an allowance which is payable where accommodation was not provided by Victoria Police”. 5

[17] The alternative to that proposition, that the Bed allowance be provided in circumstances of accommodation not being adequate accommodation, stems from one reading of Deputy President Smith’s decision about the circumstances in which the inadequate accommodation allowance should be paid. Specifically, that the terms of clause 71 do not create an entitlement for a particular level of accommodation to be provided to employees, with the corollary expectation being that the inadequate accommodation allowance would be paid where the accommodation falls below an objective level of accommodation. Instead the inadequate accommodation allowance would be paid when other tests, as set out in clause 71, have been met.

[18] Within the Police Federation submissions, the following is argued;

  • “Where adequate accommodation is provided there is no claim for accommodation”, 6 meaning that if Victoria Police provide adequate accommodation to an employee, then the Police Federation concedes no further payments, in respect of the accommodation at least, are payable to the employee;


  • Whereas the 2007 Agreement 7 referred to allowances being a reimbursement,8 the 2011 Agreement no longer makes a reference to reimbursement in relation to travelling allowances and instead the references are to the allowances being an entitlement;9


  • In support of that view, that the allowance is no longer a reimbursement, the Police Federation refers to the quantum of the allowances as militating against it being so. 10


[19] As a result, the matters requiring determination by me are;

  • On the one hand, and in furtherance of the Police Federation’s application for resolution of the dispute pursuant to s.739 of the Act, is whether the proper construction of the 2011 Agreement, is that an employee allocated to “inadequate accommodation should be paid not only the inadequate accommodation allowance but also the “Bed allowance”.


  • In the alternative, and in furtherance of the Victoria Police application whether, for reason of the 2011 Agreement being either uncertain or ambiguous, the discretion of the Commission should be exercised to vary the agreement through the insertion of a new clause in order to clarify its operation.


[20] The Police Federation argue that no uncertainty or ambiguity arises. Clause 71 is not uncertain. The 2011 Agreement’s provision of a Bed allowance is an entitlement and not a reimbursement, and there will be circumstances where both are paid;

    “27. The distinction between allowances paid by way of reimbursement and entitlements is highlighted within clause 71 itself. 71.3 retains the notion or reimbursement otherwise removed from 71.1. In order for an employee to receive greater than the schedule rate it must be reimbursement of actual and necessary expenditure ... that exceed[s] the rates provided in the agreement. The amount is expressed as an additional sum by way of reimbursement. It is not in lieu of the original entitlement.” 11

[21] It follows from the Police Federation’s argument against uncertainty that, if they are correct, further remedy by the Commission is not required for any residual part that remains of the Police Federation Application. In contrast, if they are incorrect and ambiguity is found within the 2011 Agreement, relief could be ordered by the Commission under either the Police Federation Application or the Victoria Police application, depending on the nature of the ambiguity found.

[22] The application by Victoria Police pursuant to s.217 of the Act seeks the insertion of a new clause into the 2011 Agreement in the following terms;

    “71.7 Where the employer does not arrange accommodation for the employee and the employee incurs the cost of that accommodation, the employee will be entitled to be paid the amount prescribed against the item "bed" under the Expense Related Allowances column within Schedule C. To remove any doubt, the amount is not payable where the accommodation is arranged and paid for by the employer but is not adequate. In that case, the inadequate accommodation allowance prescribed in Schedule C is payable.”

[23] Interpretation of the agreement requires application of well-established principles including those set out by the Full Bench within the matter of Golden Cockerel v AMIEU. 12 Relevant to the purposes of this matter, in construing an enterprise agreement it is first necessary to determine whether an agreement has a plain meaning or contains an ambiguity; and regard may be had to evidence of surrounding circumstances to assist in determining whether an ambiguity exists.13

[24] Consideration by the Commission of the Victoria Police Application to vary the agreement requires the threshold determination of ambiguity and/or uncertainty within the agreement that is the subject of the application, with s.217 itself providing the following;

    “217 Variation of an enterprise agreement to remove an ambiguity or uncertainty

    (1) The FWC may vary an enterprise agreement to remove an ambiguity or uncertainty on application by any of the following:

      (a) one or more of the employers covered by the agreement;

      (b) an employee covered by the agreement;

      (c) an employee organisation covered by the agreement.

    (2) If the FWC varies the enterprise agreement, the variation operates from the day specified in the decision to vary the agreement.”

[25] In giving consideration to this section, the Commission has held on previous occasions that before the Commission exercises its discretion to vary an agreement it must first identify an ambiguity or uncertainty: per Tenix. 14 The relevant principles have been summarised in this way;

    “(a) The discretion to vary an agreement to remove ambiguity or uncertainty not enlivened unless and until the tribunal identifies ambiguity or uncertainty.

    (b) Once ambiguity or uncertainty has been identified it is a matter of discretion as to whether or not the agreement should be varied to remove the ambiguity or uncertainty.

    (c) In exercising that discretion the tribunal must have regard to the mutual intention of the parties at the time the agreement was made as a matter to which significant weight should be accorded. In particular:

      (i) The tribunal should have regard to the mutual intention of the parties objectively ascertained. That is, the tribunal should have regard to the construction of the relevant clause that is yielded by an application of the conventional principles of construction of industrial agreements. This will usually, if not invariably, involve the tribunal in considering the objective matrix of facts within which the agreement was made.

      (ii) The tribunal should also have regard to whether there was an mutual subjective intention, that is, whether the subjective intention of the parties coincided. Such an intention may be discerned from the circumstances at the time and the subsequent conduct of the parties.

    (d) Regard should be had to the objects of the Act in which the power to vary is found.

    (e) While the discretion should be exercised having regard to all the circumstances of the case, other matters to which regard may be had include representations as to the effect of the agreement made to employees by the employer, directly or through an agent (which may include a union).” 15

[26] Both Victoria Police and the Police Federation agree that the approach set out in Tenix as to the ascertainment of ambiguity or uncertainty is the correct course to be taken. 16

[27] As referred to earlier, the Police Federation submit that where “adequate accommodation is provided, there is no claim for accommodation”, 17 which I take to be a concession that, in such cases, no further payments are due to an employee, at least in respect of the accommodation. Following from that proposition would be that the Bed allowance is to be paid where accommodation has not been provided, or that the provided accommodation is not adequate accommodation.

[28] In its submissions, Victoria Police state that its primary contention is that the terms of the 2011 Agreement when it comes to payment of the allowance is uncertain, with the uncertainty arising because of what is said to be the lack of prescriptive words in the body of the agreement and the absence of any explanatory words in the schedule. 18 Victoria Police also point to the fact that in the hearing that led to the June 2014 decision of Deputy President Smith, the parties had made competing contentions regarding the circumstances in which the allowance was to be paid.19

[29] As an alternative proposition, Victoria Police contend that if the agreement’s terms are not uncertain, then they are at least ambiguous, with such ambiguity being evidence through the competing contentions of the parties about when the allowance is to be paid.

[30] In support of its contentions, Victoria Police brought forward evidence from Jodie Gilbert, Portfolio Manager Workplace Relations, who is a person who has been involved in the negotiations leading to the formation of the 2011 Agreement. Ms Gilbert’s evidence reinforces the submissions of Victoria Police about uncertainty;

    “14. As I understand, the contention which the Police Federation makes about the Bed allowance is that it is payable even though an away from home employee has incurred no expense on their own account in relation to the accommodation they used. It is enough that the accommodation is not "adequate accommodation" within the meaning of that phrase in clause 71.5(a).

    15. In other words, the money paid under the allowance would not be in any sense a reimbursement of an expense incurred, but an amount paid on the basis that the accommodation was not of an adequate standard. This would suggest that the payment is one in the nature of compensation for the "hardship" in using accommodation that is deemed "not adequate". If that is so, the allowance has been struck at an unusually high daily amount. By comparison, the camping out allowance (clause 77.1 of the Current Agreement) which is payable in circumstances where an employee is required to camp out overnight is $88.53 and is an all-inclusive allowance for accommodation and incidentals.” 20

[31] Ms Gilbert’s evidence canvasses the content of earlier agreements as well as steps in the negotiation of the 2007 and 2011 Agreements. In this regard, her evidence is that in the course of the 2007 Agreement negotiations, a claim had been made by the Police Federation for the payment of an allowance of $108 per night in circumstances where an officer was unable to be accommodated in single room three or 3 ½ star motel standard accommodation. Such claim was not accepted by Victoria Police at that time. Instead;

    “24. The 2007 Agreement did include, however, in clause 13.1.3 (f) provision for payment of an "inadequate accommodation allowance" as prescribed (and itemised by reference to clause 13.1.3 under the heading "Capital City Allowance-Overnight") in Schedule C of that agreement. That allowance was set at an amount (initially $25.75 increasing to $28.14 over the life of the agreement) much less than the allowance which had been sought through clause 60.1 of the log. The inclusion of the payment of an inadequate accommodation allowance in the 2007 Agreement formalised an existing arrangement as per Peter Bull's letter to Police Federation dated 11 February 2003 ...” 21

[32] In relation to the negotiation of the 2011 Agreement, Ms Gilbert’s evidence includes the following;

    “25. I was also involved in the negotiation of the Current Agreement and completed a comprehensive analysis of the Police Federation log of claims. The ... extract of the log of claims served by the Police Federation ... discloses (in clause 13.1.3) that the union sought to include additional wording for the inadequate accommodation allowance and to increase the amount payable to $100.00 as of 1 July 2011. As is apparent from the terms of the Current Agreement, neither claim was agreed through the bargaining process.

    26. I respectfully suggest that what I have related regarding the objective circumstances in which relevant negotiations relating to the Bed allowance occurred and the basic objective facts regarding the negotiations themselves indicate that:

      (a) when the 2007 Agreement and Current Agreements were negotiated it was well understood and accepted that the Bed allowance was an allowance paid where an Actual accommodation expense was incurred by an away from home employee.

      (b) claims were made by the Police Federation in negotiations for a change in that situation by the inclusion in the agreement of terms that provided that the Bed allowance or an equivalent allowance would be payable where the accommodation booked and paid for by Victoria Police was not adequate accommodation, but Victoria Police did not accede to those claims and terms to the effect of the claims were not incorporated in the resulting agreements.” 22

[33] Victoria Police also submit the following about the surrounding context of the relevant clauses;

    “14. Victoria Police's contentions based on the text of the relevant terms and related matters are as follows:

      (a) Clauses 70.1 and 70.3 read together exhibit a general intention that the allowances payable to an away from home employee under Part 12 are allowances paid as reimbursement of an actual expense incurred by an employee; and therefore unless an away from home employee is placed in a position where they pay for the accommodation they use, they have no entitlement to be paid the Bed allowance. In this regard, the only apparent exception is the prescription in Schedule C of an allowance where the accommodation provided is not adequate.

      (b) The quantum of the allowance is large given especially that it is a per diem allowance and would therefore have significant economic consequences for both employees and employer. In that case, it would be expected that if it was payable where no reimbursement of an expense was involved, there would be clear words conveying that this was the case (see also the contentions made regarding history below).

      (c) The expression bed in Schedule C is apt shorthand to describe an entitlement tied to the cost of obtaining accommodation for a night. On the other hand, it is inapt and/or insufficient to describe an entitlement connected to some dis-amenity or hardship.

      (d) It is prescribed as an absolute amount regardless of the degree or respect in which accommodation is below the requisite standard. It is implausible that an allowance of that size involved would be so constructed.

      (e) The 2011 Agreement prescribes an allowance called an "Inadequate Accommodation Allowance". That allowance is payable (with one exception) where an away from home employee is required to share accommodation. Plainly, a case of sharing accommodation is a case where the Police Federation maintains that accommodation provided by Victoria Police is not adequate and therefore an employee is entitled to the Bed allowance. That is the position that was put by it in submissions on 17 June 2014. Accordingly, the contention advanced by the Police Federation that the Bed allowance is payable where the accommodation provided is not adequate entails the contention that an away from home employee who is sharing accommodation is entitled to both the Bed allowance and the Inadequate Accommodation Allowance for each night. That is implausible also.” 23 (original emphasis)

[34] In relation to the proposition that the Bed allowance was payable in circumstances where the inadequate accommodation allowance also was to be paid, Ms Gilbert gave the following evidence about the operation of the 2007 Agreement;

    “20. I am not aware of the basis upon which the rate for the Bed allowance was originally based, except that as I indicate above, I am not aware of them being established on a hardship or disadvantage basis, and, further the amounts do appear to broadly correspond to what might be expected to be the cost per night for reasonable accommodation.

    21. I have made inquiries of administrative staff responsible for the processing of claims by away from home employees for the payment of allowances in the period in which the 2007 Agreement applied, being 28 October 2007 until 1 December 2011. I have been informed and believe that according to their recollection and on their examination of the records, payment of the Bed allowance was made where the away from home employee claiming it had themselves been required to pay for relevant accommodation and it was not claimed in circumstances where accommodation booked in Victoria Police's name and paid for by Victoria Police was said to be not adequate. They are not able to recall an instance where it was claimed or paid on the basis that accommodation provided and paid for by Victoria Police was claimed to be not adequate.

    22. Accordingly, I say that that it was well understood by employees and the Police Federation at the time of negotiation of the Current Agreement (and also the 2007 Agreement) that the existing position was that the allowance called the Bed allowance was an allowance claimable and payable in circumstances where the away from home employee themselves incurred the liability for paying for the accommodation they used.” 24

[35] For its part, the Police Federation resists the proposition of uncertainty, saying that clause 71.1 creates a general entitlement to travel allowances which are then clarified through the subsequent sub-clauses. In respect of clauses 71.5 and 71.6, which are the focus of this decision, the Police Federation makes the following submission;

    “14. 71.5 deals with the circumstances when an employee will not be entitled to specific allowance.

    15. Where adequate accommodation is provided there is no claim for accommodation; Where adequate meals are provided there is no claim for meals; Where accommodation and/or meals are provided as part of the transport arrangements there is no claim for accommodation or meals respectively.

    16. Contrary to the submission of Victoria Police at par 7 there is no uncertainty as to when the allowances are payable at what rate. In the submissions of Victoria Police they do not identify what is not definitely known or perfectly clear; the state of doubtfulness or irresolution.” 25

[36] In relation to the general principle of “uncertainty”, the Police Federation refer to an earlier decision of Commissioner Gay in the matter of Media, Entertainment and Arts Alliance, in which it was found;

    “Clearly rival contentions alone are insufficient to have the Commission find an ambiguity or uncertainty. In this case there is uncertainty in the requisite sense to have the Commission consider exercising the discretion open to it to remove the uncertainty. Mr Wicks took up the point made by GU that, because the application asserted the existence of an uncertainty "(but not ambiguity)" the Commission was precluded from finding an ambiguity. The Alliance contend in reply, that the outcomes of applications "are not bound by the grounds which appear on the application (which anyway includes the "other reasons" catch all)". It is not necessary for these issues raised by the Alliance to be dealt with to finalise the application. The Commission is conscious that Mr Murdoch answered the case brought by the applicant which in terms, specified that there was not an ambiguity claimed.

    I have taken the meaning of uncertainty given in Volume 11 of the Shorter Oxford Dictionary (Third Edition) where, unlike in the definition of the word uncertain, `ambiguity' is not given as a meaning. I have taken uncertainty to mean the state of not being definitely known or perfectly clear, the state of doubtfulness or irresolution. The Commission has not relied on a finding of ambiguity.” 26 (original emphasis; references omitted)

[37] This approach to the meaning of “uncertainty” was applied by Deputy President Smith in another matter involving an application to vary in order to remove ambiguity or uncertainty. 27

[38] While the Police Federation endorsed the approach previously taken by the Commission in Tenix, it submitted however that Victoria Police have erroneously formed the view that ambiguity exists based solely on the basis that there are competing contentions. In this regard, the Police Federation notes the findings about ambiguity set out by Senior Deputy President Williams in S J Higgins Pty Ltd and others v Construction, Forestry, Mining and Energy Union;

    “[6] As to the proper approach to be applied to applications to vary agreements for the purpose of removing ambiguity or uncertainty, a Full Bench, in Re Victorian Public Transport Corporation3, having noted the observations of Gray J in Printing and Kindred Industries Union and Another v Davies Bros Ltd, stated -

      ... the Commission would generally err on the side of finding an ambiguity or uncertainty in circumstances where there are rival contentions advanced before it and an arguable case can be made out for more than one contention.

    [7] It must be noted, however, that, immediately prior to its reference to the observations of Gray J, that Full Bench stated that the first part of the process "involves an objective assessment as to whether or not an ambiguity or uncertainty exists". In my view, it is not enough that there are or may be rival contentions as to the proper construction of the terms of an award or agreement. Nor is it enough that claims may have been made in the field for the application of a particular provision in circumstances and its applicability of the provision is disputed. Such contentions and claims may well be self serving. The correct approach, as applied by the Full Bench, requires the making of an objective judgment as to whether, on the proper construction of the relevant provision of an agreement, the wording of that provision is susceptible to more than one meaning.” 28 (references omitted)

[39] The Police Federation submit that Victoria Police had not put forward alternative meaning of the words contained in the 2011 Agreement and have not pointed to any internal inconsistency that could be said to create an ambiguity. 29

[40] In contrast to the Victoria Police arguments that allowances are paid as a reimbursement, 30 the Police Federation point to the development of travelling allowances from the time of the 2001 Agreement and 2007 Agreement and contrast those provisions with what is set out in the 2011 Agreement;

    “23. The 2001 agreement expressly provided that travelling allowances were by way of reimbursement

      Clause 5.1.2.12 Subject to the provision of this clause members shall be entitled by way of reimbursement to allowances for fro travelling, incidental and meal expenses

    24. The 2007 Agreement was in similar terms

      13.1.1.(a) Employees will be entitled, in accordance with this clause by way of reimbursement to allowances for trave/ling, incidental and meal expenses

    25. The 2011 Agreement makes no reference to reimbursement in relation to travelling allowances rather it is expressed as an entitlement.

      71.1 An employee who travels in the course of their duty and is required to by the employer to stay overnight is entitled to be paid allowances for meals, accommodation and incidental expenses in accordance with schedule c

    26. This provision can be contrasted with provisions that retain reimbursement; 72.1 fares associated with overnight courses, 82 reimbursement of drivers licence, 83 reimbursement of telephone costs, 84 out of pocket expenses, 89, 90 relocation expenses.

    27. The distinction between allowances paid by way of reimbursement and entitlements is highlighted within clause 71 itself. 71.3 retains the notion or reimbursement otherwise removed from 71.1. In order for an employee to receive greater than the schedule rate it must be reimbursement of actual and necessary expenditure ... that exceed[s] the rates provided in the agreement. The amount is expressed as an additional sum by way of reimbursement. It is not in lieu of the original entitlement.” 31

[41] Overall, the Police Federation submits that;

    “22. At their heart Victoria Police's submissions are directed to cost to the employer and some kind of unjust enrichment to employees. That an agreement may operate, in the view of one party, inconveniently doesn't enliven the jurisdiction of the Commission. It is appropriate to deal with the balance of Victoria Police's submissions contained in paragraphs 14 and 15 in order.” 32

[42] The material and evidence provided in this matter permit the following findings;

  • Some of the documents demonstrate an intention of the parties, dating from 1992, to ensure an accommodation service provider is tendered and maintained, so as to allow an employee to have access to the services provided by a nominated contractor without having to be troubled as to cost standard or purchasing authority;


  • There is variation between the 2007 and 2011 Agreements, with the former referring to allowances in this way;


      • “13.1 Accommodation, Meal, Incidental Expense and Travelling Allowances

      13.1.1 Eligibility

        (a) Employees will be entitled, in accordance with this clause, by way of reimbursement to allowances for travelling, incidental and meal expenses.

        (b) Where, in the opinion of the Employer, special circumstances exist in respect of accommodation, meals, incidental expenses and travel and for which provision is not made in this Agreement, the Employer may pay such allowances as it considers are reasonable under the circumstances.

        (c) Where the actual and necessary expenses incurred by an Employee exceed the rates provided in this Agreement, an additional sum by way of reimbursement may be granted by the Employer.

        (d) Where it is reasonable to believe an Employee will be away from their normal station or place of employment for three days or more, travelling expenses may be paid in advance.” (emphasis added)

  • The 2011 Agreement employs different language, principally in the following clause;


      “71. Overnight Meal and Accommodation Allowance

      71.1. An employee who travels in the course of their duty and is required by the employer to stay overnight is entitled to be paid allowances for meals, accommodation and incidental expenses in accordance with Schedule C.”

  • While there might now be rival contentions as to the proper construction of the agreement, that appears to be a relatively new circumstance, with there being insufficient evidence that this has been a controversy that has been around for some time and at least from the time of the negotiations for the 2011 Agreement.


[43] After consideration of all the material supplied to the Commission, and notwithstanding the differences between the 2007 Agreement and 2011 Agreement, I do not rely on those differences for a finding of uncertainty or ambiguity in the 2011 Agreement, which is the instrument before me.

[44] However I am satisfied from the language of the 2011 Agreement that its terms are uncertain. This arises for the reason that the 2011 Agreement does not refer to a Bed allowance within the body of clause 71 and the same clause does not elaborate on what is meant by the reference in clause 71.1 to an entitlement to “be paid allowances for meals, accommodation and incidental expenses in accordance with schedule C”. (emphasis added)

[45] There is no guidance within clause 71 or Schedule C to be able to ascertain when the Bed allowance should be paid.

[46] The extrinsic material provided by the parties does not greatly assist the task of establishing the meaning of “Bed allowance” within Schedule C of the 2011 Agreement. In this regard, I have given consideration to the different contents of the 2007 and 2011 Agreements; those parts of the respective logs of claim submitted in evidence; and the exchanges between the parties as to their desire to establish a contract for accommodation providers, and the subsequent decision to do so.

[47] It is possible that the decision of the Commission on the specific arrangements for accommodation at Mt Buller may have changed the understanding of one or other of the parties about when the inadequate accommodation allowance is payable. This in turn may have highlighted whether the Bed allowance should be paid in circumstances where “inadequate accommodation” is provided, leading to an allowance being payable for that purpose as well.

[48] The historical practices of the parties, as set out in Ms Gilbert’s evidence, would indicate that they took the conjunction of clauses 71.5 and 71.6, and in similar clauses in antecedent agreements, to mean that;

  • Whenever the employer provided accommodation, which was not inadequate accommodation, the Bed allowance would not be paid;


  • Whenever the employer provided accommodation, but which was inadequate accommodation, the inadequate accommodation allowance would be paid and the Bed allowance would not be paid; and


  • The Bed allowance would only be paid whenever the employer did not provide accommodation, in which case the inadequate accommodation allowance would be a moot issue for the reason that it was up to the employee to choose their standard of accommodation.


[49] That is, the totality of the evidence leaves me persuaded it is more likely than not that Ms Gilbert is correct when she gives evidence that;

    “that the existing position was that the allowance called the Bed allowance was an allowance claimable and payable in circumstances where the away from home employee themselves incurred the liability for paying for the accommodation they used.” 33

[50] Whilst there is merit in the Police Federation position that the 2011 Agreement makes no reference to reimbursement in relation to travelling allowance and instead is expressed only as an entitlement, the submission does not lead to an acceptance that the mutual intention of the parties was to allow for the allowance to be payable when inadequate accommodation has been provided, the corollary of the Police Federation submission that “where adequate accommodation is provided there is no claim for accommodation.” 34

[51] I therefore consider that the 2011 Agreement is uncertain about when the Bed allowance is to be paid, and that the extrinsic material before me does not lead to a certain construction of the agreement. That is, the material before me does not lead to the construction of the 2011 Agreement favoured by the Police Federation.

[52] Overall, I consider it appropriate to resolve the uncertainty through a variation to the agreement having regard to the mutual intention of the parties at the time the agreement was made.

[53] In considering the best means by which to resolve the uncertainty to which I have referred, I note the following submissions of the Police Federation;

    “46. The amendment proposed by the employer doesn't go to the intention of the parties and merely seeks to avoid the cost. It clearly leaves it open for the employer under any circumstances to arrange inadequate accommodation.

    47. The Police Federation submits that any amendment should go to the mischief the parties originally sought to rectify. That is if there is an uncertainty then its rectification it includes clarifying the obligation on the employer to provide adequate accommodation where it chooses to provide accommodation since all of the evidence points to this being the mutual intention of the parties

    48. The PFAs view on a proposed amendment is that it should have three components;

      a. The obligation to provide adequate accommodation;
      b. Payment to employees where adequate accommodation is not provided; and
      c. Payment to employees where required to share facilities”35

[54] The Police Federation have put forward an alternative Draft Order to that proposed by Victoria Police which would amend clause 71.5 and insert a new 71.6, with the consequential renumbering of the existing clause 71.6 to 71.7. Their proposal in this regard is as follows;

    “1. Delete the text contained within 71.5 and replace with;

      Where an employee is required to stay overnight the employer will arrange adequate accommodation. Adequate accommodation means a minimum of three star single motel room standard with private facilities.

    2. Insert a new clause 71.6;

      Where an employee resides overnight and;

      (a) The employer provides adequate accommodation the employee is not entitled to payment of an allowance in relation to the accommodation provided;

      (b) The employer provides adequate meals, the employee is not entitled to payment of an allowance in relation to the adequate meal provided; or

      (c) The employee travels by air, boat, rail or other facility, and sleeping accommodation is provided and charged for in the fare, the employee is not entitled to payment of an allowance in relation to the accommodation provided.” 36

    3. Renumber the existing clause 71.6 accordingly

[55] This stands in contrast to the proposal from Victoria Police which is for a single new clause 71.7 in terms referred to above.

[56] In considering the alternative, I do not favour that put forward by the Police Federation in respect of the amendments to clause 71.5. In my opinion clause 71.5 has more work to do than merely to direct that Victoria Police is to provide adequate accommodation and to define what that might mean. In particular, the clause deals with the subject matter of when the incidentals portion of the allowances provided for within clause 71.1 are to be paid.

[57] I do not consider that the Police Federation proposal for a renumbered clause 71.6 entirely resolves the issues between the parties. Whereas the proposal is expansive in respect of payments for adequate accommodation, the question of payment of the Bed allowance for inadequate accommodation is left unresolved.

[58] For this reason, I have decided to exercise the Commission’s discretion to vary the 2011 Agreement in the manner proposed by Victoria Police. I consider the clause to be consistent with the parties’ intent when drafting the 2011 Agreement, which I discern to be;

  • An intention that the primary responsibility for the arrangement of accommodation rests with Victoria Police with its well established provider contract arrangements. It is more likely than not that all concerned expected the contract to be the dominant framework for provision of overnight accommodation bookings well into the future.


  • That when provided accommodation falls beneath an objective standard and becomes “inadequate accommodation”, it was more likely than not that the parties expected this payment would be in part a disability allowance payable to the employee recompensing them for needing to experience less than standard accommodation; and in part that it was intended to be a disincentive on the employer against commonly arranging such accommodation;


  • That when an employee has to arrange their own accommodation, they are paid an allowance for the cost of the accommodation, being the Bed Allowance in Schedule C. It also appears more likely than not that the parties’ expectation at the time of concluding the 2011 Agreement was that in providing for the allowance it went with an expectation that employees could make their own choice about the quality of the accommodation they booked.


  • It appears unlikely that the Bed Allowance was intended to be a payment to an employee who had their accommodation arranged and provided by their employer.


[59] Accordingly, I consider it appropriate to insert within the agreement a new clause 71.7 in the following terms;

    “71.7 Where the employer does not arrange accommodation for the employee and the employee incurs the cost of that accommodation, the employee will be entitled to be paid the amount prescribed against the item "bed" under the Expense Related Allowances column within Schedule C. To remove any doubt, the amount is not payable where the accommodation is arranged and paid for by the employer but is not adequate. In that case, the inadequate accommodation allowance prescribed in Schedule C is payable.”

[60] In making a decision to vary the 2011 Agreement, it follows that I dismiss the Police Federation application to deal with a dispute, C2014/831.

[61] Orders consistent with the above will be issued at the same time as this decision.

COMMISSIONER

Appearances:

Mr A Nicolaou, Ms J Baker and Ms J Gilbert for Victoria Police

Mr C Kennedy for the Police Federation of Australia

Hearing Details:

2015.

Melbourne

28 April

 1   AG2011/12253, AE889678

 2   [2014] FWC 3737

 3   [2014] FWC 3737, [3] – [10]

 4   Ibid, [12] – [13]

 5   Victoria Police correspondence to Fair Work Commission, 30 June 2014

 6   Exhibit P1, para 15

 7   Victoria Police Workplace Agreement 2007; AC310674, CAUN073745495

 8   Exhibit P1, para 24 ; see also 2007 Agreement clause 13.1.1 (a)

 9   Ibid, para 25; see also 2011 Agreement clause 71.1

 10   Ibid, para 30

 11   Ibid, para 27

 12   [2014] FWCFB 7447

 13   Ibid, at [41]

 14   Re Tenix Defence Systems Pty Limited Certified Agreement 2001-2004 (2002) AIRCFB PR917548, at [28]; confirmed in CPSU v Telstra Corp Ltd, (2005) 139 IR 141, at [17]

 15   APESMA v Oceanic Coal Australia Pty Ltd[2011] FWA 3146, at [9]

 16   Exhibit V2, para 3; Exhibit P1, para 4

 17   Exhibit P1, para 15

 18   Exhibit V2, paras 5 – 7

 19   Ibid, para 8

 20   Exhibit V1, paras 14 – 15

 21   Ibid, para 24

 22   Ibid, paras 25 – 26, as amended in oral evidence

 23   Exhibit V2, para 14

 24   Exhibit V1, paras 20 – 22

 25   Exhibit P1, paras 14 – 16

 26   Media, Entertainment and Arts Alliance, Re The Greater Union Organisation Pty Limited Cinema Agreement 1996 (1998) AIRC Print Q0099

 27   2014 FWC 48, at [26]

 28   (2001) PR903843; cited with approval in Grocon v CFMEU PR924146 and Beltana Highwall Mining PL PR932468

 29   Exhibit P1, para 20

 30   Exhibit V2, para 14 (a)

 31   Exhibit P1, paras 23 – 27

 32   Ibid, para 22

 33   Exhibit V1, paras 20 – 22

 34   Exhibit P1, para 15

35 Ibid, paras 46 – 48

 36   Exhibit P1, Attachment PFA 4

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