C2007/3711, Transcript of Proceedings [2007] AIRCTrans 687 (21 December 2007)

TRANSCRIPT OF PROCEEDINGS

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Workplace Relations Act 1996 17928-1

SENIOR DEPUTY PRESIDENT HARRISON
SENIOR DEPUTY PRESIDENT CARTWRIGHT
COMMISSIONER FOGGO

C2007/3711

s.120 - Appeal to Full Bench
Appeal by Swire Cold Storage Pty Ltd
(C2007/3711)

MELBOURNE

10.03AM, TUESDAY, 11 DECEMBER 2007

PN1

MR J FORBES: I seek leave to appear on behalf of the appellant.

PN2

MR B JOHNSON: I appear on behalf of the TWU.

PN3

SENIOR DEPUTY PRESIDENT HARRISON: Thank you. Any difficulty with leave being granted to Mr Forbes?

PN4

MR JOHNSON: No, your Honour.

PN5

SENIOR DEPUTY PRESIDENT HARRISON: Leave is granted for you to appear, Mr Forbes. May I identify a couple of documents that we've received, you can let us know, there should have been some other documents before us, from you, Mr Forbes, the appellant's outline of argument dated 28 November, Mr Johnson, your outline of submissions for the respondent dated 10 December. Now, I think they each either contained in the body some authorities or annexed a list of authorities. I don't think there was a separate document filed by either of you. Mr Forbes, should we have received anything more from your side?

PN6

MR FORBES: Your Honour, I think there was a separate list of authorities filed. What I do have for each of the Commission members is a list in the form of a book with the non-Commission authorities.

PN7

SENIOR DEPUTY PRESIDENT HARRISON: All right. Thanks.

PN8

MR FORBES: I am not intending to take the Commission to these at great length.

PN9

SENIOR DEPUTY PRESIDENT HARRISON: You take the folders back again, then, for the time being.

PN10

MR FORBES: All right.

PN11

SENIOR DEPUTY PRESIDENT HARRISON: It is a matter about which I have a strong view. Nothing further from your side?

PN12

MR FORBES: No, your Honour.

PN13

SENIOR DEPUTY PRESIDENT HARRISON: Mr Johnson, anything further from the TWU we should have received?

PN14

MR JOHNSON: Yes, your Honour, just two items. I just before the hearing provided these also to the other side. There was just a further authority that wasn't listed in the list of authorities upon which we rely. There is also a ruling from the Australian Taxation Office which I will during the course of proceedings seek to introduce. I can either provide those to - - -

PN15

SENIOR DEPUTY PRESIDENT HARRISON: No, just hold onto them for the time being.

PN16

MR JOHNSON: Certainly. Other than that, there were no other items which we needed to provide.

PN17

SENIOR DEPUTY PRESIDENT HARRISON: Thanks. Have the two of you had an opportunity to agree on what now are the issues before this Full Bench? What we would like is ideally that to be the subject of agreement between the two of you. If you can reduce it to writing, so be it, but if you can actually record it, that is what we require and, of course, in that respect what we wish to know is, it would seem that some of the grounds are not opposed by you, Mr Johnson. They may well be conceded. We want identification of those grounds and identification then of the matters addressed in each of the written submissions that we do not need to concern ourselves with.

PN18

Similarly, insofar as there are grounds that remain that are pressed by the appellants and opposed by you, Mr Johnson, and they may be confined to the five weeks in the $28 matter, but there might be others, we wish the identification of those grounds and again the parts of the outline of submissions that go to those grounds that we do need to concern ourselves with. Now, additionally it seems that there's an issue relating specifically to the grounds which may be conceded by the TWU that, despite the concession, nonetheless those matters would not be sufficient to persuade us that leave should be granted so we need to know whether that is the position of the TWU. Now, do you need a short time to agree on what you both will then inform this Full Bench what its task is today? Mr Forbes.

PN19

MR FORBES: Your Honour, I have a fairly clear view of that. I haven't spoken to my learned friend, so if we were given a few minutes, I would be fairly confident that we can set the parameters of this appeal within the next 10 minutes or so.

PN20

SENIOR DEPUTY PRESIDENT HARRISON: Yes, and doing so, you will also identify in the document what matters we no longer need to concern ourselves with, which grounds are no longer live?

PN21

MR FORBES: Yes.

PN22

SENIOR DEPUTY PRESIDENT HARRISON: Shall we say 10 minutes, but if you need a longer period, but shall we say adjourn for 10 minutes? Keep my associate informed.

<SHORT ADJOURNMENT [10.08AM]
<RESUMED [10.28AM]

PN23

SENIOR DEPUTY PRESIDENT HARRISON: Mr Forbes.

PN24

MR FORBES: Thank you, your Honour. I think we can considerably narrow the scope of the appeal. Can I ask the members of the bench to go to the notice of appeal which is at page 1 of the appeal book? I can indicate as I walk through this the grounds which are pressed and those which are not. The first ground under the heading jurisdiction generally, that is no longer pressed by the appellant. The next set of grounds which is 2 to 4 under the heading shift allowances jurisdiction, those grounds are pressed, but will not be contested by the union.

PN25

SENIOR DEPUTY PRESIDENT HARRISON: I know this is your summary of the position, both your client and the TWU, but not contested, is that something different to conceded as is contained in the TWU - I know there is a better person to ask this question of, but you're the one that's letting us know what you understand is the agreed position between the parties. Do you understand there's something different in those words, because I would have thought there was, not pressed and conceded?

PN26

MR FORBES: Yes. I think they're conceded. I put it on the basis of pressed, but not contested for a particular reason. Well, perhaps if Mr Johnson - - -

PN27

MR JOHNSON: If it pleases the Commission, I may answer that question. I certainly did intend to use the words not contested because although the matter in relation to grounds 2 and 4 was indicated to be conceded in the submissions in reply of the TWU, this appeal is a different matter altogether and for the purposes of this matter, we use the words not contested. It's entirely up to the Commission as to how it approaches the matters, but I don't use the word conceded in terms of grounds 2 and 4, rather, not contested. We won't be making submissions on those grounds. It's merely a matter of propriety for the union that we've previously put a position of concession in relation to the grounds of shift allowances. We're not going to turn back on that as a matter of propriety. That is all I have to say.

PN28

SENIOR DEPUTY PRESIDENT HARRISON: Mr Forbes.

PN29

MR FORBES: So those grounds 2 to 4 still necessarily are pressed, even though they won't be contested and they are pressed, well, first of all we want findings in relation to those, but also it goes to the question of leave. We say that they are important matters to be taken into account in relation to our application for leave to appeal, but there won't be argument about those points. The next ground is ground 5 and that is also pressed, but again won't be contested. That's an issue that goes to the shift allowance where we say Commissioner Lewin erred by incorrectly construing the agreement in relation to the shift allowance. The union will not contest that point. Ground 6(a) is also not going to be contested.

PN30

SENIOR DEPUTY PRESIDENT CARTWRIGHT: But is pressed?

PN31

MR FORBES: But is pressed. Thank you, your Honour. 6(b) to (d) are not contested in relation to the question of shift allowance, but are contested in relation to the remaining two points which is the $28 and the five weeks. What grounds 6(b) to (d) deal with is the issue of construction and the union wishes to put a different position in relation to construction and they say that a different way of approaching the $28 and five weeks should be adopted compared to the way we say Commissioner Lewin should have done it. The next group, 7 and 8, which is the $28 issue, that's contested between us. 9 and 10 which is the five weeks' notice part of the decision is contested.

PN32

Ground 11 is no longer pressed. We abandon that. That related to the inadequacy of the original decision from Commissioner Lewin, but as the bench would be aware, he issued a subsequent decision so we no longer press the inadequacy of the reasons and then 12 and 13 deal with leave to appeal and disposition and we press those and those are no doubt contested. Now, the upshot of that is that what we're really arguing about here are those parts of Commissioner Lewin's decision that deals with the $28 matter and the five weeks matter. Now, if I can take the Commission to the outline which we filed, that's the outline dated 28 November.

PN33

SENIOR DEPUTY PRESIDENT HARRISON: Shall we mark that?

PN34

MR FORBES: Yes, I am happy for that to be marked.

EXHIBIT #A1 OUTLINE OF SUBMISSIONS

PN35

MR FORBES: Paragraphs 1 to 6 of our outline are introductory and we would ask the Commission to take note of those. They should stay in. Paragraph 7 is no longer relevant. Paragraphs 8 to 25, insofar as the contest about the shift allowances jurisdiction point is concerned, those paragraphs are really no longer necessary, but your Honours and Commissioner, they are relevant to the question of leave and disposition. You may be aware that the point that we raised was that when Commissioner Lewin retired to make his decision, the issue of shift allowances in effect had been agreed between the parties and Commissioner Lewin either overlooked that or didn't pick it up or proceeded in any event and we were going to contend in this appeal that the fact that there had been agreement between the parties before Commissioner Lewin retired meant that there was in fact no dispute between the parties over that point and that that went to jurisdiction.

PN36

Now, my learned friend and the union are no longer going to contest that and therefore we would say that the appeal should be allowed in relation to that point, but what we say at paragraphs 8 to 25 are still relevant to the question of leave. It's an important point which had to be agitated and we say we've been vindicated in agitating it and the Commission should take those paragraphs into account in considering whether or not to grant leave and, of course, we say leave should be granted. Moving on, then, to paragraphs 26 to 34 and that's the group of paragraphs that contain the core of our submissions regarding the principles about construction of certified agreements, they remain relevant, then there is a group of submissions from paragraphs 35 through to 59.

PN37

Now, those paragraphs, your Honours and Commissioner, are under the heading shift allowance, but they contain a discussion about the expressions week's pay and ordinary time rate of pay and those expressions and that discussion are critical to understanding our appeal in relation to the $28 and the five weeks as well, so we can't dispense with those paragraphs and what is said there and I will go to this in a little more detail later is that the expressions week's pay and ordinary time rate of pay are well known expressions in industrial jurisprudence and Commissioner Lewin didn't construe the agreement having regard to the usual and acceptable meaning to those words.

PN38

The group of submissions at 60 through to 67 of course remain relevant and then 68 through to 81 which are our submissions about the five weeks' notice point are relevant, 82 can be dispensed with and then 83 and 84 go to disposition and leave, so we would ask that those remain. Now, I've also discussed with my learned friend his submissions and he informs me and I think it's plain on the reading that he has in fact constructed his submissions having regard to the concessions that were going to be made today and I don't think anything needs to be omitted from the union submissions.

PN39

SENIOR DEPUTY PRESIDENT HARRISON: Mr Johnson.

PN40

MR JOHNSON: Your Honour, the only paragraph that would be omitted is paragraph 3 which is just introductory in any sense. The only point that I would say in reply is that in relation to grounds 2 to 4, I did indicate that the union is not contesting the appeal grounds. That's not to say that we don't believe that there is substantial merit in the decision that was made by Commissioner Lewin below. It's merely the case that we're not contesting the appeal grounds as they have been put. As I indicated before, it's entirely up to the Commission how it treats the appeal as it's been presented to the Commission. If it pleases, your Honour.

PN41

SENIOR DEPUTY PRESIDENT HARRISON: And as I understood what you said earlier, that is the position that is taken because you say it is appropriate given the manner in which it was run below.

PN42

MR JOHNSON: That's entirely correct, your Honour. If it had not been indicated in that way previously, we would certainly be running a different position here.

PN43

SENIOR DEPUTY PRESIDENT HARRISON: I understand.

PN44

MR FORBES: I think that means, your Honour, I will probably have to make good those points in grounds 2 to 4, but won't need to spend a lot of time doing it.

PN45

SENIOR DEPUTY PRESIDENT HARRISON: Well, maybe the Full Bench might have a think about that, as to whether it is inclined to - how it would deal with grounds that are not contested in the context of nonetheless there is an issue about leave and I must say one thing that would be, of course, relevant is the merit of your $28 and five weeks and that overall consideration of leave.

PN46

MR FORBES: Yes, your Honour, I accept that all matters need to be taken into account.

PN47

SENIOR DEPUTY PRESIDENT HARRISON: In any event, I would not have assumed you would spend a long time on those.

PN48

MR FORBES: No, I won't need to.

PN49

SENIOR DEPUTY PRESIDENT HARRISON: And I think you could be fairly safely assuming that this Full Bench is not in a hurry to start setting down principles for all time about what weeks' pay and ordinary rate of time might mean wherever and whenever it turns up in any award and EBA. We might try and confine ourselves to the interesting issues raised by this EBA.

PN50

MR FORBES: Yes. Thank you.

PN51

SENIOR DEPUTY PRESIDENT HARRISON: Proceed.

PN52

MR FORBES: If the bench pleases, can I go first to those grounds 2 to 4? What we contend in this appeal is that Commissioner Lewin made - or part of Commissioner Lewin's - let me withdraw that. I probably should set this up by first of all asking the bench to go to Commissioner Lewin's decision.

PN53

SENIOR DEPUTY PRESIDENT HARRISON: Which one?

PN54

MR FORBES: You would be aware that there were two, the first one being 4 October 2007 and that will be found at pages 5 to 18 of the appeal book. I am just reminded that the second decision is not in the appeal book, but am I right in assuming that you have that?

PN55

SENIOR DEPUTY PRESIDENT HARRISON: Yes.

PN56

MR FORBES: The first decision is in the appeal book from pages 5 through to 18 and if I take you to page 13 of the decision which is page 17 of the appeal book and right at the bottom of the page at paragraph 31 is Commissioner Lewin's - in effect his determination of the section 170LW private arbitration and what led to this was that Commissioner Lewin had been notified of a dispute by the union. The dispute essentially had four claims and I take it the Commission is aware of the general background to this case that effectively - it's a claim for entitlements for certain redundant employees and the claim ran to four discrete points and those four points were that each employee should get five weeks' notice in addition to any other notice entitlements, secondly that the employees should receive as part of their severance pay an amount, or, rather, an amount of $28 should be included in weeks' pay for the purposes of calculating severance entitlements.

PN57

The third point was that shift allowances received by employees for ordinary weekday work ought be taken into account in calculating weeks' pay and the fourth point was that severance pay should be calculated based on an employee's actual hours of work, what was referred to below as the contracted hours, so they were the four points that the union raised and argued for before Commissioner Lewin and each of those particular claims was contested by my client below and what Commissioner Lewin did at paragraph 31 of his decision was to say that for the purposes of clause 13 of the certified agreement which I will go to in a little bit more detail later, but for the purposes of that clause, weeks' pay should include the amount of money which would be paid to an employee for the hours of work in respect of which the hourly rate of pay would be single time, so weeks' pay is the 38-hour rate plus the amounts prescribed as shift allowances and penalties plus the amount of $28.

PN58

However, insofar as the claim related to contracted hours, he did not accede to that claim and I omitted to mention the first dot point which is that employees should get the five weeks' notice, so if the four union claims, Commissioner Lewin granted three of them, did not granted the contracted hours point. Now, what has caused us to agitate the appeal at grounds 2 to 4 is that prior to Commissioner Lewin making his decision about shift allowances, the employer's argument against the inclusion of shift allowances had in fact been conceded by the union, so in argument before Commissioner Lewin, there was an agitation between the parties, but after the hearing or at the end of the hearing, Commissioner Lewin invited the parties to put in further written submissions and the union in its further written submissions conceded the employer's argument regarding shift allowances and I should just take the bench to the evidence of that because it is important to show that there was in fact agreement between the parties.

PN59

SENIOR DEPUTY PRESIDENT HARRISON: Why can't we just accept that?

PN60

MR FORBES: I am sorry?

PN61

SENIOR DEPUTY PRESIDENT HARRISON: Why can't we just accept that that is so and then you can proceed to develop the relevance of that presumably to the leave question which might be the matter that will concern us?

PN62

MR FORBES: Yes, all right, if the bench is content to accept that, that the agreement or rather the employer's shift allowance argument was expressly conceded in written submissions, then what arises from that we say is at the point Commissioner Lewin had to determine the issues in dispute between the parties, at the point at which he exercised his section 170LW private arbitration powers, that there was in fact no dispute between the parties as to shift allowance and that that goes to jurisdiction and we deal with that in our outline of submissions. What we say is that the Commission's jurisdiction in relation to section 170LW is essentially contained within the parameters of the dispute between the parties.

PN63

Section 170LW as each of you will be aware requires that there be a dispute between the employer and employees regarding the application of the agreement and in order for jurisdiction to be founded, it's necessary for the Commission to have a dispute between those parties about the application of the agreement and if there is no dispute about a particular issue, in our submission that issue stands outside the jurisdiction of the Commission when exercising his section 170LW powers.

PN64

We refer and we've set out the extract so I won't hand up the case, but at paragraph 22 we refer to the case of UFU v Metropolitan Fire and Emergency Services Board where the Full Bench of the Commission cited with approval the PKIU High Court case and the essence of what the High Court found is that a dispute can be ambulatory. It can expand and contract depending on the positions the parties adopt in relation to matters from time to time, so a dispute is not a static concept and what happened in this case is that the union came to Commissioner Lewin with four points and at a point - - -

PN65

SENIOR DEPUTY PRESIDENT HARRISON: Having said I wasn't that concerned about something you might have been taking us to earlier, for a short time I am interested and concerned. Take us to the originating application requesting a dispute settlement procedure be undertaken or the 170LW.

PN66

MR FORBES: I am not sure that's in the folder.

PN67

SENIOR DEPUTY PRESIDENT HARRISON: If it's not, come back to it and just - - -

PN68

MR FORBES: I will come back to it, but what I can take you to, your Honour, is if I take you to tab E9, page 235, 235 to 237 of the appeal book and what that is is that prior to this matter going to arbitration, there had been the usual process of some conciliation and some meetings and various other things that the Commission hosted and it got to the point, however, where the issue had to be arbitrated and at 235 to 237 is the submission that the TWU put in prior to the arbitration and, your Honour, if I take you to about a third of the way down the second page, that's 236.

PN69

SENIOR DEPUTY PRESIDENT HARRISON: Yes, I see it.

PN70

MR FORBES: What the union is seeking is those four things.

PN71

SENIOR DEPUTY PRESIDENT HARRISON: Yes, all right, but the manner in which this matter first got off the ground may or may not, the document evidencing that may or may not be in the appeal book?

PN72

MR FORBES: I don't think it's in the appeal book. I can try and turn that up.

PN73

SENIOR DEPUTY PRESIDENT HARRISON: It just concerns me that in effect what you're saying is when one is asked to arbitrate a matter and needs to be alive at all times during the arbitration, right up to when you publish the decision, what are the matters in dispute. I am not very attracted to defining those as being clauses X, Y, Z and subclauses 2, 3 and 4. Once it is clear there is a dispute that has found its way into the Commission and there is a matter to be arbitrated, you generally categorise it, don't you, here it might be categorised as the appropriate redundancy payments or entitlements in accordance with the EBA? The attraction of going too much further and identifying the specific issues which, as you say, may change from time to time I don't like a lot at the moment, Mr Forbes.

PN74

MR FORBES: Your Honour, I accept the difficulty in that for a member of the Commission because the parties do move their positions constantly. However, what I would say, your Honour, is that insofar as section 170LW is concerned, it's a little bit different to the old resolution of a constitution industrial dispute. 170LW discretely targeted as conferring on the Commission a power of private arbitration in relation to a dispute that falls within 170LW, so a dispute between employer and employees about the application of the agreement and in my submission, the dispute that the Commission privately arbitrates needs to be the things that the parties differ on at the point they're asking the Commission to assist and one can in many respects perhaps forgive Commissioner Lewin for what happened here, because the parties essentially came along and in broad terms are saying we have an argument about how clause 13 works.

PN75

That's what we were arguing about and the union has got one view about how it works and we have another view, but as the argument developed and prior to Commissioner Lewin having to make his decision, one discrete area, one discrete part of the union claim in fact was given away and the union conceded and in their document of concession and I should take you to this which is 235 in the appeal book, this was their subsequent written submission - I am sorry, 253 and following, this was the TWU written submission that they put in after being invited by Commissioner Lewin to do so, can I take you to page 256 of that and the bench will see at about three-quarters of the way down the page the heading part I response and what that was was a response to part I of the employer's written submission and not wishing to complicate matters too much, but that's back at page 251, so page 251 is the employer's written submission about weekday shift allowances and in there we contended that shift allowances shouldn't be included for the purposes of week's pay or ordinary time rate of pay and we set that out there and then at 256 the union puts in a written submission to Commissioner Lewin saying, part I response:

PN76

Weekday shift allowances the union would concede underline -

PN77

not by us, by them -

PN78

underline this issue as 13.3.1 of the agreement excludes the payments referred to as allowances.

PN79

And then if I could ask the Commission to go over to page 257 which is the continuation of the union's written submission and at the top of the page the union comes back to addressing its four point claim and it refers to the five weeks, point 2 is the $40.50, that's the $28 which they refer to, point 3, the contracted hours point and then point 4, the weekday shift penalties point and they go on to say:

PN80

The union now concedes item 4 and would seek the Commission to make a decision in relation to matters 1, 2 and 3.

PN81

So our contention is that at the time Commissioner Lewin retired to exercise the arbitral power conferred on him under the Act, he had the employer saying and arguing shift allowances shouldn't be included, the union saying in writing in submission we're only after matters 1, 2 and 3 now, not 4, we concede and in my submission the fact the Commissioner Lewin went on and dealt with the shift allowances claim and indeed granted it involved him operating beyond the jurisdiction he had at the time he was called upon to exercise it, so I understand what you're saying, your Honour, about a dispute may well come to the Commission in one form, but for 170LW it's a different function about assisting the parties arising out of the agreement between the parties for issues between them to be resolved with the assistance of the Commission and when the parties say to the Commission before the decision is made you don't need to deal with that because we agree, it's not a dispute and 170LW does not confer power.

PN82

Now, that's all I intended saying about that point. I understand it's not being contested, but the fact that it does go to an important jurisdictional matter and the fact that Commissioner Lewin in my submission on any view has gone off and done something that the parties didn't want is a matter that very much goes to the public interest and to the question of leave and we say in relation to the shift allowances claim and the fact that Commissioner Lewin in effect granted it, the appeal should be allowed on that point and you ought find that Commissioner Lewin didn't have jurisdiction.

PN83

SENIOR DEPUTY PRESIDENT HARRISON: Would you just pause for a moment, please, Mr Forbes? Do you have a copy of the originating application now because we do?

PN84

MR FORBES: You do?

PN85

SENIOR DEPUTY PRESIDENT HARRISON: Would you like us to give you a copy, too?

PN86

MR FORBES: Yes.

PN87

SENIOR DEPUTY PRESIDENT HARRISON: Just give us a minute. It may or may not give rise to any questions. Otherwise, we know that this point you have dealt with. Yes, I see how the dispute is referred to at least in this document.

PN88

MR FORBES: Yes, it appears to have come into the Commission in the old style, we've got a dispute, please help us type scenario, but you'll see - - -

PN89

SENIOR DEPUTY PRESIDENT HARRISON: Well, he certainly didn't ever lose jurisdiction in relation to dealing with the dispute concerning clause 13. Certain aspects that were in issue and about which relief was sought went away, but we need to consider if that then gives rise as you say to dealing nonetheless with one of those aspects that have gone away is jurisdictional error.

PN90

MR FORBES: I guess simply put, your Honour, what we say is that the fact that the parties have a dispute about construction of a particular clause does not then set the Commission at large to consider the clause as a whole if the parties before him are saying we don't have a dispute about one point.

PN91

SENIOR DEPUTY PRESIDENT HARRISON: Shall we just put this in the appeal book somewhere? You can consider that it's now in the appeal book. It would be good if I indicated on transcript what I am talking about. We've been provided now with a copy of the original form requesting a dispute resolution process be conducted. It's dated 31 May and the questions or the exchange that I've just had with Mr Forbes seems to relate to the description of which clauses of the agreement the dispute related to, clause 13, redundancy is contained in this form. I think the transcript is now adequate to know that that is before the Full Bench.

PN92

MR FORBES: Thank you, your Honour. If I could just make this one final point. The further evidence that this goes to jurisdictional error is the way in which Commissioner Lewin dealt with it and he dealt with this at very great length, the issue of 170LW jurisdiction, particularly in relation to the question of employees who were no longer with the employer. What Commissioner Lewin did correctly I would submit is to observe that the jurisdiction to deal under 170LW is in fact set or the parameters are set by what's in dispute and the way one determines what is in dispute is to have regard to the divergent views between the parties for the contending submissions and I've dealt with this at paragraphs 12 and 13 in the outline and I've extracted paragraph 21 from Commissioner Lewin's second decision and what Commissioner Lewin did is that he observed and I say correctly that it's the divergent views concerning the terms of the agreement that characterises the dispute.

PN93

That makes sense, that a dispute is evidenced by the fact that the parties are contending for different outcomes or that the parties have differing views about the way a clause should be read and Commissioner Lewin acknowledges that that's the evidence of dispute. What he has not picked up on is that there were no longer divergent views or contending submissions about the shift allowance point so that what one would normally look for to evidence the dispute between the parties about a particular matter wasn't there any more and at paragraph 24 of the outline I summarise that by saying that what we say is in the absence of the divergent views or the contending submissions that Commissioner Lewin refers to, there can't be said to be a dispute about that aspect of the agreement and that goes to jurisdiction.

PN94

Now, also before I leave shift allowances, the Commission will also see that we also contend that in granting the shift allowance claim as part of ordinary pay or weeks' pay, Commissioner Lewin has misconstrued the agreement. Perhaps it's appropriate that I now go to the question of construction because that's what the remaining points of appeal rely on, the $28 and the five weeks claim. Essentially what Commissioner Lewin had before him was a dispute between two parties about how clause 13.3 or clause 13 of the certified agreement should work. I am not sure whether the Commission has had an opportunity to look at the agreement, but I should take you to it. It commences at page 198 of the appeal book and the particular clause in question you will find at page 205, so this is the Swires Cold Storage Pty Ltd Victorian Transport Workers Agreement 2005.

PN95

That's the section 170LJ agreement between my client and the union and that was operative at the time. In fact, I don't think that's been replaced. At page 205 there is a clause 13 headed redundancy and that travels over about two pages and the real contest between the parties centred on clause 13.3, the one that's headed severance pay. The factual background is reasonably straightforward. My client was making a fairly considerable number of employees redundant. There was disagreement between the company and the union as to what the redundant employees should get and 13.3 sets out severance - - -

PN96

SENIOR DEPUTY PRESIDENT HARRISON: On those facts, there is something I am not clear about. In all cases where the employee is told at least five weeks prior to the redundancy occurring that they would be made redundant, so - it might give rise to a question later, but in all cases there was five weeks' notice that their positions would be declared redundant.

PN97

MR FORBES: I think that's right.

PN98

SENIOR DEPUTY PRESIDENT HARRISON: Thank you.

PN99

MR FORBES: It was a redundancy that was rolled out over a period of months and so in fact the dispute which arose between the parties I think actually arose before anybody had been made redundant, but the dispute continued on and people were made redundant while we were in the Commission and beyond, I think.

PN100

SENIOR DEPUTY PRESIDENT HARRISON: So there was no question at least that clause 12 standing alone needed to be considered? Well, certainly that part of it that requires notice didn't create a problem, nor in the circumstances did that part of the clause which requires payment in lieu arise. It's the clause 13 requirements which, because of 13, might take you back to 12.

PN101

MR FORBES: Yes, well, what we will say is that 13 is a code and you don't go to 12 at all. I am instructed that all the redundancies were in fact voluntary and all well in advance of five weeks.

PN102

SENIOR DEPUTY PRESIDENT HARRISON: Yes, and then just another fact which may or may not be of any relevance, but were any of those employees, well, I think I probably know the answer to this. Clause 13.4 deals with employees that leave during the notice period. It says something about that. Those factual circumstances weren't enlivened on your instructions?

PN103

MR FORBES: No.

PN104

SENIOR DEPUTY PRESIDENT HARRISON: None of these employees left earlier?

PN105

MR FORBES: Not that I'm aware of, no.

PN106

SENIOR DEPUTY PRESIDENT HARRISON: Thank you.

PN107

MR FORBES: It was all very well orchestrated and planned. It was a matter of volunteering and then a date was picked and people went. Now, severance pay, so 13.3, severance pay, is at the kernel of what we've been arguing about in this case to date and the Commission will see that the first point, 13.3.1 under another heading, severance payment, refers to five weeks' pay for each full year of permanent service up to a maximum of 80 weeks, so that at least on its face seems fairly straightforward, so an employee made redundant gets five weeks' pay for each full year of permanent service up to a maximum of 80 weeks and then it's followed by what I think all parties concede is probably a paragraph of some confusion which says in this paragraph:

PN108

Weeks' rate of pay means the current company rate for level 4 and level 6 drivers plus shift penalties and where applicable but devoid of any allowances.

PN109

The shift allowance point that we've been discussing in effect is excluded by those words. The union I think accepts that because it says devoid of any allowances, it means devoid of shift allowances and it's an appropriate concession to have made, then 13.3.2 and you'll see under the heading notice of termination it says:

PN110

Five weeks' pay, weeks' pay as per point 1 in lieu for each employee.

PN111

And there has been an argument between us as to what that means and the union says and Commissioner Lewin agreed that basically that means that if you're terminated by reason of redundancy, you get an extra five weeks' pay. That's the essence of it, then we can skip over long service leave, sick leave and annual leave simply because they're not matters which have been live in this case, but then I take you to 13.3.6 and my instructor reminds me that Commissioner Lewin wasn't asked to nor did he deal with long service leave, sick leave or annual leave. They weren't matters in dispute, but 13.3.6 was and it will be seen there that 13.3.6 says:

PN112

Week's pay means the ordinary time rate of pay for the employee concerned.

PN113

I will come back to address this in some detail in a moment, but it's the interaction between 13.3.6 and 13.3.1 which goes to the $28 argument. The $28 argument is that there is an amount of $28 that every full-time employee gets which the union contended should form part of weeks' pay for the purposes of calculating the severance entitlement and we say that you don't take that into account because weeks' pay is defined in 13.3.6. It defines weeks' pay as meaning the ordinary time rate of pay. That's the only function 13.3.6 has got. It's to define weeks' pay and the cases tell us that ordinary time rate of pay, the expression ordinary time rate of pay is an expression with a technical meaning in industrial jurisprudence.

PN114

This is an expression which has been to the High Court and the Federal Court and the Commission and everywhere in between. You'll find it in the Macquarie Dictionary. Ordinary time rate of pay is a concept with a simple, plain, well known meaning and it doesn't include things that fall outside the normal 38-hour base rate and I will come back to that in a moment, so that's what the $28 dispute was about is whether the $28 falls within ordinary time rate of pay. The five weeks dispute, the notice dispute, comes down to whether 13.3.2 confers on every employee an entitlement to five weeks' pay irrespective of whether they have received notice in time and Commissioner Lewin found against us on that point and he found that 13.3.2 in effect confers on employees who are terminated by reason of redundancy an entitlement which is additional to the standard notice provision in clause 12 and the Commission will see back at page 204 in the appeal book there is clause 12 and that's got the usual one week, two week, three week type notice provision. Commissioner Lewin found that the existence of the notice provision in clause 13 is additional to that, not in substitution for it and we say, no, it's in substitution for it.

PN115

SENIOR DEPUTY PRESIDENT HARRISON: It could have been made a bit clearer if that's what was meant, for example, clause 13 being made - for example, any other clause being made subject to 13 or vice versa regardless of what is said elsewhere, when an employee goes by reason of redundancy, these are the rules.

PN116

MR FORBES: Your Honour, I certainly agree it could have been made clearer, no doubt about that, but what we contended for is that clause 13 in effect is a code that says exactly what you say, that if you go for redundancy, these are the things you get and Commissioner Lewin - - -

PN117

SENIOR DEPUTY PRESIDENT HARRISON: Why doesn't it make perfectly good sense as it is? When it's redundancy, there are certain moneys you will receive. In this case, the employer gave at least five weeks' notice that the employment relationship would cease, so it didn't have to consider whether there would be a payment in lieu a la clause 12. It gave the five weeks' notice, but when you parted ways, it was by reason of redundancy and why doesn't one read that, that one of the components of the moneys you receive is a five weeks payment?

PN118

MR FORBES: Because what we say, your Honour, is that it doesn't make sense because, (1) if it's just a five weeks payment, it's not notice, it's a severance payment, it's not notice and the words are five weeks' pay in lieu for each employee. In lieu of what? It must be in lieu of notice, that is in lieu of notice in time. What Commissioner Lewin found, your Honour, is in effect that that provision is not about notice at all, it's about a payment.

PN119

SENIOR DEPUTY PRESIDENT HARRISON: Just staying with your construction, it so happened in this occasion the employer didn't want to effect the redundancies promptly and for that it is to be congratulated, as long as possible lead time that your position is going to be made redundant is good, but there might have been a consequence for the employer doing that and that the issue of in lieu just doesn't arise and nonetheless you have this clause that requires a payment of five weeks' pay.

PN120

MR FORBES: In lieu and that's the issue, your Honour. The task for the Commission, of course, is that we have to try and make sense of this and it's clearly confusing, but Commissioner Lewin agreed with us I think in saying that clause 13 is a code, so it's a code, it's a code that deals with redundancy. Now, if it's a code, it should be read as a code. That's what codes are about. You read them as a discrete set of paragraphs to deal with a particular eventuality. It's headed redundancy, it's all about people who are made redundant and therefore one would expect to see in a clause like this a provision regarding severance pay, that's there, a provision about giving notice and we say that's there, provisions about what happens if you leave during notice and you'll see that at 13.4, a provision about taking time off during notice to go and look for another job, that's at 13.5, so all the things are there that one would ordinarily expect to find in a redundancy type code, but we say to the extent that there's any confusion about what 13.3.2 means, it is that it confers an obligation on us to give five weeks' notice to employees.

PN121

The consequence, your Honour, is if we don't give it, we pay and that's why it refers to in lieu, but if we do give it, if we do give the time notice, in our submission you don't then pay the extra five weeks on top. Now, Commissioner Lewin said you do, it's one of the benefits of redundancy. Now that we're talking about that, I should perhaps complete my argument about the five weeks' notice and you'll see that I've dealt with the five weeks' notice claim from paragraph 68 through to 81 of our outline.

PN122

One of the things that clearly influenced Commissioner Lewin to construe the notice clause the way he did was a document which went in and I will just turn it up for you, page 90. The bench will see that page 90 and 91 is a 1998 document headed Clelands total inventory management. That was the predecessor to my client and Clelands entered into an agreement obviously back in 1998 about some redundancies that were going to occur at that time and you'll see at paragraph 2 the heading notice of termination and if we omit the crossing out, it reads the way we contend that it should be read and that is it's five weeks' notice or pay in lieu for each employee. That makes sense.

PN123

Now, we don't know what happened in 1998 and there was no evidence about the problems of this document, but it is what it is and it can be seen that a hand-written amendment was made to that clause so that the words notice or were taken out and that when you omit those words, those are now the words which have trickled through subsequent agreements and found their way into the 2005 agreement. Now, all sorts of things might have happened in 1998. There was no evidence before Commissioner - - -

PN124

SENIOR DEPUTY PRESIDENT HARRISON: What about paragraph 9 of that document? That's not called notice of termination, but it rather assumes there is additionally a notice period that is to be observed a la clause 12, for example.

PN125

MR FORBES: That may well be why the hand-written amendment was made.

PN126

SENIOR DEPUTY PRESIDENT HARRISON: What was said about this document? It went in for some reason. If you both agree when it went in and what was said about it, you don't need to take us to the document, to the transcript, for example, but how did this go in?

PN127

MR FORBES: It went in as part of the written submission from the union prior to the hearing.

PN128

SENIOR DEPUTY PRESIDENT HARRISON: You can make a note to yourself to assist us with that, Mr Johnson, and what you said the weight should be given to that and how it comes in.

PN129

MR FORBES: What we did, your Honour, we contended that, well, it's a document from 1988 - - -

PN130

SENIOR DEPUTY PRESIDENT HARRISON: 1998.

PN131

MR FORBES: Sorry, 1998. There was no evidence about who made this agreement or what they intended, so we made those points, but Commissioner Lewin has taken the view that this is a document which goes to construction of the 2005 agreement. It's appropriate to be taken into account in terms of the historical provenance of clause 13 generally and he took the view that particularly because of the hand-written amendment, it must have been the intention then and now that it's a five-week payment. I think I observed without any evidence, but one of the suggestions that I made is that, well, this could well have been a deal that was done in 1998. They just decided that, all right, we'll give you your five weeks.

PN132

It has that look about it, but I haven't got any evidence, but what we say is that if the Commission looks at the words as they were before the hand-written amendment, they make sense and that's what was always intended and it's probably the cut and paste in later years that have just involved picking up and transferring as unfortunately these things do, but that the proper construction, the only construction that makes sense is that in clause 13.3.2 it appears under the heading notice of termination. That's got to be what it's about. It expresses a payment to be in lieu, it must be in lieu of something and if it's not to be construed as meaning notice in time or money in lieu, then it shouldn't be expressed as a notice provision at all, it's just about pay. It should be part of the severance payment.

PN133

SENIOR DEPUTY PRESIDENT CARTWRIGHT: What is the significance where it talks about the fact that the parties have changed between 1998 and 2005?

PN134

MR FORBES: Well, the significance, your Honour, is that the proper rules of construction obviously require the Commission to approach the agreement it has before it so the 2005 agreement and what the cases tell us, Kucks v CSR and the other cases I refer to is that industrial parties tend to be imperfect in their language, but the first step in construing an agreement is to look at that agreement and to construe it in accordance with its words. That's step one, so if the words make sense, you don't look beyond it. You don't take into account other extraneous material.

PN135

If the words are ambiguous or don't make sense, then it is permissible to look beyond it to other extraneous material, but essentially the task is to ascertain the mutual intention of the parties to the current agreement. It's about getting into the minds of Swire and the TWU as to what they mean when they made the 2005 agreement. The fact that something happened back in 1998 in the hands of a predecessor employer doesn't necessarily mean that you can attribute that to the current employer.

PN136

There's probably not a great deal turns on the change of name or the fact that the businesses moved from one to the other, but that fact, that it has moved from one company to another company, the fact that seven or eight years has transpired between the new agreement being made and the old and the fact that parties to the new agreement are different people to what occurred back in 1998 in my submission all goes to say that one can't place too much weight on what happened in 1998 without direct evidence about it. There was no evidence from anybody who made that agreement in 1998, there's no evidence from anybody who made the agreement in 2005.

PN137

SENIOR DEPUTY PRESIDENT CARTWRIGHT: On that point?

PN138

MR FORBES: On that point or at all. Sorry, on that point, on that point. Now, this matter like any other, the union bears an onus and could well have come along and said, well, here are the people who are in the room in 2005 making the latest enterprise agreement and clause 13.3.2, notice of termination, should be read in a particular way because that's the way we intended and we wanted it to be the same as what happened in 1998, but they didn't discharge that onus.

PN139

SENIOR DEPUTY PRESIDENT HARRISON: I don't think I like the idea of onus when the question is one of construction and the Commissioner was faced with competing constructions, but a document to which a predecessor to your company signed and the TWU signed. If we're going to buy into onus, maybe it was open to both of you, you to distance yourself or them to call it to their aid.

PN140

MR FORBES: That's a fair point, your Honour. I put it on this basis, however, that where a party contends that one should be looking at extraneous documents and other material, then there is an onus on that party to bring it along and we contended that this can be read without having to look at anything else. It's clearly - there is a way of reading this so that it makes sense.

PN141

SENIOR DEPUTY PRESIDENT HARRISON: To read words into it.

PN142

MR FORBES: You have to simply put the words back in that were scribbled out.

PN143

SENIOR DEPUTY PRESIDENT HARRISON: You call to your aid that of the document that you like and you distance yourself from that of the document you don't, though, Mr Forbes, don't you?

PN144

MR FORBES: Your Honour, not entirely. Yes, we can say we'll have a look at 1998, those words were there and it makes sense. Putting that to one side, your Honour, we would say one clearly applies those words in there. That's how it makes sense.

PN145

SENIOR DEPUTY PRESIDENT HARRISON: I understand your clause 13 argument.

PN146

MR FORBES: The error that Commissioner Lewin made in our submission is to place the weight he did on the 1998 agreement to conclude that the notice provision was an additional payment. Commissioner Lewin seemed to adopt the view that when one looks to clauses 13.4 and 13.5 which are the mechanical provisions regarding notice and leaving and so forth, he adopts the view that, well, none of those things excludes his interpretation that it's an additional payment. However, none of those things excludes our interpretation that it's a replacement payment.

PN147

Well, we say it's a replacement rather than an additional payment and Commissioner Lewin seems on the one hand to say that clause 13 is a code, yet on the other hand he says, well, you read it with clause 12 and there's just an internal inconsistency in all of that. Your Honour, we say simply that when it comes to notice, it ought to be given real meaning, it ought to operate within the code that deals with redundancy. It sits under a heading which one would expect it to sit under and the obligation on the company is to give employees five weeks and if you don't, to pay in lieu the shortfall of notice.

PN148

SENIOR DEPUTY PRESIDENT CARTWRIGHT: So when we come to clause 13.4 and 13.5, both of which refer to in the case of 13.4 the period of notice, 13.5, period of notice on termination and 13.5.2, during the notice period, what do you say that's referring to and why?

PN149

MR FORBES: It's referring to the five weeks. It's referring to the five weeks' notice period in 13.3.2. What we contended below and perhaps I can simplify it this way, that we say that 13.3.2 should read five weeks' notice or, so it's five weeks' notice or pay in lieu for each employee, so that sets the - - -

PN150

SENIOR DEPUTY PRESIDENT CARTWRIGHT: It's always adventurous to read words in that aren't there, isn't it?

PN151

MR FORBES: To make it make sense, your Honour. It doesn't make sense otherwise in my submission. What Commissioner Lewin did is to say that the notice referred to in 13.4 and 13.5 is clause 12 notice. That's how Commissioner Lewin cured that dilemma.

PN152

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Despite the heading of 13.3.2, notice of termination?

PN153

MR FORBES: Yes, so Commissioner Lewin on the one hand said clause 13, redundancy, is a code to deal with redundancy. Now, we agree with that. 13.3.2 is the notice for employees who are made redundant and, your Honour, not unusually, it's a better notice period than you'll get under clause 12. That's what normally happens in redundancies, that employers will give an extra week or an extra whatever it may be over and above the standard notice period, so that's a special notice period for employees who are terminated by reason of redundancy, so that sets the notice and then you go to 13.4 and 13.5 and they work perfectly well if an employee is given five weeks' notice and leaves early or wants time off. My instructor has just pointed out something in relation to 13.4 that I should draw to your attention and it will be seen that it refers to leaving during notice, so that if an employee is terminated for reasons set out in 13.1, so that's if you're terminated for reasons of redundancy, then -

PN154

you shall be entitled to the same benefits and payments under this clause as if you had remained with the employer until the expiry of such notice.

PN155

So it's a clause which is contained to the notice within the clause, so that you're entitled to certain benefits and payments under the clause, but if you go early, you will keep those benefits and payments as if you had stayed until the expiry of the notice.

PN156

COMMISSIONER FOGGO: And the last sentence?

PN157

MR FORBES: Sorry, but you don't get the notice payment itself. What Commissioner Lewin has done is to say that all of this has to operate in conjunction with clause 12. We say it doesn't. That's the essence of the dispute.

PN158

SENIOR DEPUTY PRESIDENT CARTWRIGHT: So when it says such notice in 13.4, what is that referring to?

PN159

MR FORBES: In my submission it's a reference to the notice entitlement under 13.3.2 which is the time notice.

PN160

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Why isn't it the notice in clause 12?

PN161

MR FORBES: It could be, but we say it's not because everything about clause 13 has the look of a code about it, including 13.3.2 which if it's to have any purpose at all, the purpose is described by the heading. It's the notice of termination.

PN162

SENIOR DEPUTY PRESIDENT CARTWRIGHT: That being a more generous provision than in clause 12?

PN163

MR FORBES: Yes, so an obvious example would be if there had been an employee there for one year or less, under 12 he would get a week, if we make him redundant, he gets five.

PN164

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Under clause 12, the maximum anyone gets is four, isn't it?

PN165

MR FORBES: I think it's four plus the over 45 week.

PN166

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Yes, it's four plus one if you're over 45 and have 10 years' continuous service.

PN167

MR FORBES: That's right.

PN168

SENIOR DEPUTY PRESIDENT CARTWRIGHT: And your contention is that 13.3.2 operates as a more general provision to extend that five weeks to everybody?

PN169

MR FORBES: It does and the experience of industrial relations is such that that's fairly typical that in a redundancy situation, a more beneficial redundancy entitlement will be extended to employees.

PN170

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Yes, I was going to say that's not an unusual arrangement, is it?

PN171

MR FORBES: No, it's not unusual and, your Honour, we say that Commissioner Lewin has in fact had to engage in greater gymnastics than I have to come to the conclusion that he has in saying this is intended to be really just another payment, just a payment of five weeks.

PN172

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Someone makes the point - no, sorry, that's relevant to the $28.

PN173

MR FORBES: As I say, we've made submissions in relation to the five weeks. I've dealt with those and I would rely upon what we say at 68 through to 81. There remains then the one further issue and that is the $28. Can I take your Honours and Commissioner to page 229 and 230 of the appeal book and that's the tail end of the certified agreement and the way the certified agreement works is that the rates of pay are not in the body of the agreement, they're at the end, recorded as a memorandum of understanding. I don't think that's particularly relevant in this case. It's just the way it's been done and I think been done for years.

PN174

SENIOR DEPUTY PRESIDENT CARTWRIGHT: I note that clause 9.1.1 refers to the memorandum of understanding dated July 2002 and it's actually a memorandum that's undated, but appears to be 2005 that's attached. Presumably there is no significance to that.

PN175

MR FORBES: I hadn't noticed that, your Honour. That's a good pick-up and I think that's what happens with cutting and pasting, I suspect. The memorandum of understanding that the parties certainly adhere to is the one that's bolted onto the end of the certified agreement that you will see at 229 and 230 and I suspect that this is probably a remnant of the days when the parties did something on memoranda of understanding and some things in agreements. My instructor just points out that the previous certified agreement used those clause 9 words.

PN176

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Yes, I assumed that was the case and therefore has got no significance.

PN177

MR FORBES: No significance, no. You will see that point 1 refers to rates of pay and it sets out a schedule of various grades of employee, grades of driver, from grade 4 through to grade 8 and the payments, the hourly rate that will be paid for ordinary hours of work at various times during the life of this agreement and below that there is a prescription of how certain increases will be effected during the life of this agreement and it's basically five per cent per year in consideration of various productivity and other movements and that type of schedule is the way in which pay and the hourly rate has been dealt with in predecessor agreements, that kind of thing, then if I take you over to the following page at 1.2 and you'll see that there prescribed is an amount of $40.50 will be paid weekly to full-time employees with $12.50 being sacrificed to cover accident make up premium payment referred to in clause 18.3.

PN178

Now, $40.50 minus $12.50 gets you the $28, so what that clause has done is to give each full-time employee an extra $28 in their pay over and above the hourly rate times 38 type arrangement and the issue at stake below was that the union argued that the $28 that employees get should form a component of weeks' pay for the purposes of calculating severance payments, notice payments and other things. In other words, they get this $28, it should be taken into account, that ups the amount and it obviously increases the severance payment that's received and what the employer contended is that that amount should not be included in the expression weeks' pay because it doesn't form part of each employee's ordinary time rate of pay.

PN179

It requires a little bit of sort of cross referencing back and forward, but 13.3.1 provides for severance pay of five weeks' pay per year of service, 13.3.6 defines weeks' pay to mean ordinary time rate of pay and we say that this $28 amount is not part of ordinary time rate of pay when one looks at how that expression has been construed in industry for many, many years. Now, there was some evidence given about this $28 and the evidence was given by Mr Jury and his affidavit is included in the appeal book at page 92 and in particular at paragraphs 29 through to 35.

PN180

What Mr Jury came along to the Commission to say was that this amount which is expressed as $40.50 minus an insurance premium has its genesis back in the late 1980s and that back in the late 1980s, this company or rather the predecessors in business, it was called Greenways Transport - I am sorry, it was Clelands and then Clelands bought a company called Greenways Transport and the drivers over at Greenways Transport and we're talking nearly 20 years ago, the drivers over at Greenways Transport were getting an allowance called a drop rate and that was $40.50 and in order to merge the two groups of employees - sorry, I apologise.

PN181

The employees at Greenways were getting a drop rate which varied, so if you like it was an over award payment or an allowance, an incentive based performance allowance and in order to merge the two groups of employees, an averaging process was gone through and it was agreed to give everybody $40.50 on top of your award rate and so that payment of $40.50 was an incentive or an allowance payment which in order to ensure consistency across two groups of employees was tacked on as an additional payment and it's been referred to by Mr Jury as an incentive payment or an incentive allowance elsewhere, but it's an amount of money that has never been incorporated into the base rate of pay and at page 108, for example, in one of the predecessor agreements, this is the 1998 certified agreement, you'll be able to see at 10.1.2 a reference to the weekly incentive payment and at 10.2:

PN182

Allowances other than those referred to above shall be paid.

PN183

It has always been and Mr Jury's evidence was that the $40.50 payment is not part of the base rate of pay. It's only paid to full-time employees, it's paid irrespective of what your roster might be or however many hours you work and it's never been adjusted from $40.50. It's been $40.50 forever. The only change that's been made over time is that it has been whittled away by an increasing amount of it being directed toward an accident insurance payment.

PN184

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Why isn't it paid to part-time employees?

PN185

MR FORBES: I don't know.

PN186

SENIOR DEPUTY PRESIDENT CARTWRIGHT: I note that it's paid to full-time employees, but under contract of employment, the agreement provides for full-time employment, part-time employment, it goes over to casual employment and it also covers specified time or specified task employment which actually may be full-time or part-time. Why is this only to full-time employees?

PN187

MR FORBES: Your Honour, I can't answer that question, but what I can say is that the point you raise goes very much to the point I am seeking to make and that is that this is a special deal that was done donkey's years ago which has in effect been quarantined and it was a payment agreed to by way of averaging some performance based payments and it was obviously granted to those who existed at the time who one can probably assume were full-time employees, but from that date on it's been quarantined. It's never intended to be, nor can it sensibly be read as forming part of the rate.

PN188

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Well, Mr Forbes, the reason I ask is that it refers to premium payment referred to in clause 18.3 and when you go to clause 18.3, it says:

PN189

Transport employees will contribute $12.50 per week pre-tax or pro rata for part-time employees.

PN190

So it doesn't appear they get the $40.50, but under 18.3 they have to contribute pro rata for this $12.50 contribution and then under (iii) within 18.3:

PN191

The employee wishing to withdraw from the coverage can do so after formally providing the company -

PN192

et cetera, et cetera:

PN193

Upon doing so, the dollar contribution will remain in your weekly pay.

PN194

What is all that doing?

PN195

MR FORBES: I think what that's doing is - your Honour is right, the amount under the memorandum of understanding is $40.50 and the reason we talk of - - -

PN196

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Only for full-time employees.

PN197

MR FORBES: For full-time employees.

PN198

SENIOR DEPUTY PRESIDENT CARTWRIGHT: But part-time employees have to pay this pro rata contribution.

PN199

MR FORBES: It looks like it, yes, it appears that way, so the amount for full-time employees is $40.50 under the memorandum of understanding. Clause 18 provides for the accident make up income protection insurance arrangement which you correctly point out appears to apply to all. In practice, what has happened is that the $12.50 gets taken off the $40.50 in the payroll office, so the $12.50 goes into the insurance scheme and the employees get $28 in their pay packet and when they get their pay slip, that amount is separately itemised. There was evidence about that before Commissioner Lewin, so there's your rate of pay, your hours, et cetera, et cetera, and then a separate amount of $28.

PN200

SENIOR DEPUTY PRESIDENT CARTWRIGHT: So what is the significance of this last sentence in (iii):

PN201

Upon doing so, the dollar contribution will remain in your weekly pay.

PN202

In other words, if you withdraw from the coverage, the income protection coverage requiring the $12.50 or pro rata if you're a part-timer, it says:

PN203

The dollar contribution will remain in your weekly pay.

PN204

MR FORBES: Yes, so you get to keep it.

PN205

SENIOR DEPUTY PRESIDENT HARRISON: In your weekly pay.

PN206

SENIOR DEPUTY PRESIDENT CARTWRIGHT: In your weekly pay, yes. That's what I'm asking about.

PN207

MR FORBES: Yes, in your weekly pay. It's a different question, with respect, as to whether that amount forms part of ordinary time rate of pay.

PN208

SENIOR DEPUTY PRESIDENT HARRISON: Is there any evidence as to whether it was taken into account when calculating and/or paying long service leave, paid sick leave or annual leave?

PN209

MR FORBES: There wasn't any evidence about that.

PN210

SENIOR DEPUTY PRESIDENT HARRISON: I don't remember reading anything.

PN211

MR FORBES: No.

PN212

SENIOR DEPUTY PRESIDENT HARRISON: Where is this pay slip that you mentioned was before the Commissioner?

PN213

MR FORBES: I think it's an attachment to Mr Jury's affidavit. I will ask my instructor to hunt that down.

PN214

SENIOR DEPUTY PRESIDENT CARTWRIGHT: How does the $40 a week figure in the employer's superannuation contribution obligations?

PN215

MR FORBES: I don't know. Superannuation contributions, of course, are determined - I am pre-empting I suspect something my learned friend is going to submit, but they're calculated by reference to an expression ordinary time earnings which has a special meaning for the superannuation guarantee legislation and that includes all sorts of things that are not included in the well accepted definition of ordinary time rate of pay.

PN216

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Yes, I understand that, but you referring to the pay slip triggered the question. Does the pay slip make any of that clear?

PN217

MR FORBES: I am not sure. It's page 82. My instructor tells me that it's not included. Annual leave, sick leave, RDO and long service you will see are calculated based on hours.

PN218

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Sorry, where is that?

PN219

MR FORBES: Page 82, there's various entitlements and they're based on hours, so you'll see at the top of the pay, it prescribes the normal number of hours, times the rate of pay which is in the MOU to give you a particular value and then there's obviously a time and a half payment which is overtime for that particular person and then you'll see the heading additions and the first addition is incent TRSP $40.50.

PN220

SENIOR DEPUTY PRESIDENT CARTWRIGHT: TRSP?

PN221

MR FORBES: So that will be incentive transport or something, but that's the incentive we're referring to, $40.50, so that's in addition and then when you continue on down the page, you'll see the heading deductions which is partly obscured, but then there is a deduction of $12.50 INC PRT TRSP which I think is code for income insurance payment or something like that, but that's $12.50 deduction so how employees are paid and this was in evidence is that you get your rate of pay times your number of hours, then there's certain things added on, certain things taken off and that's what you take home. Now, what the cases tell us is that the add-ons and the $40.50 is an add on, the add ons do not form part of ordinary time rate of pay and in my submissions I have referred you to a number of decisions, the Scott v Sun Alliance case, paragraph 47 of my submission, a case which dealt squarely with the issue of ordinary time and ordinary time rate of pay. I've got copies of these in the bundle if that would assist.

PN222

SENIOR DEPUTY PRESIDENT HARRISON: The reason probably annual leave was expressed that way on the pay slip was because of the annual leave clause and may not necessarily resolve the dilemma that you now take us to, because the annual leave clause told you that that was calculated by reference to eight hours, because otherwise I was about to say maybe neither of you necessarily will want to have a decision on this point if it might require the revisiting of the manner in which annual leave has been paid for years, but we won't have that additional complication, it seems, because that's the reason, so for myself I don't know that that would necessarily assist one way or the other in the proper consideration of whether you bring $28 to account or not.

PN223

MR FORBES: No. Your Honour, the more direct route to the solution is simply that there is evidence about the provenance of this payment and it is paid as an addition to ordinary time and there is evidence that it's an amount which hasn't varied for years. It's been red circled, it's been contained and quarantined for a period of time and it's been whittled away as the insurance premium increases, but whether one calls it an allowance or an additional payment or an incentive really matters not. It's clearly a payment that sits outside ordinary time rate of pay. Now, as I say, I've referred to a number of authorities in the submission from paragraphs 47 through to about 54 and the authorities that your Honours ought take into account in particular and I am happy to hand up - I am a bit worried about handing up my bundle of cases, your Honour, you don't seem to want it.

PN224

SENIOR DEPUTY PRESIDENT HARRISON: I haven't singled you out, Mr Forbes. It's one of my least favourite things, to have cases before me that are either not referred to at all or stand for propositions that are, well, not notorious, but unarguable, so you can just make the proposition and we'll go back to our chambers and find our own copy, but if there's something that doesn't fall into those categories, you give us the case by all means. I would not want to be seen as depriving you of an opportunity.

PN225

MR FORBES: Thank you, your Honour. I would like to think that the authorities that I would like you to have a look at, which are Scott v Sun Alliance, a High Court decision, Kucks v CSR which is the very well known decision of Madgwick J in the Federal Court, the Commission's 2004 redundancy case and SDA v Woolworths and that's (2006) 152 IR 95. That's a decision of Gray J.

PN226

COMMISSIONER FOGGO: But, Mr Forbes, haven't you pulled out the relevant section from those three decisions you've mentioned and put them in your written submissions from paragraphs 49 through to 54?

PN227

MR FORBES: I have in essence, yes.

PN228

COMMISSIONER FOGGO: Isn't that what you're going to? Isn't that what you're asking us - - -

PN229

MR FORBES: That's what I would ask you to have a look at. Each of the cases differs slightly. The SDA v Woolworths case - - -

PN230

COMMISSIONER FOGGO: I think you can take the written submissions as read. Start from that assumption.

PN231

MR FORBES: Thank you, Commissioner. The SDA v Woolworths case is of particular significance, a recent case involving what gets taken into account in ordinary time rate of pay. What the cases have said, your Honours and Commissioner, is that this expression ordinary time rate of pay has over time become a word of science, I mean, it's got a technical meaning now and when it's used in industrial jurisprudence, unless it's qualified in some way, it's got a pretty clear meaning and the Commission's 2004 redundancy case, I've extracted something from that decision at paragraph 52, but what happened there was that the employers said, look, week's pay is an expression which has been used in the TCR provisions for donkey's years, but it could use a bit of clarification and where it needs clarification is to expressly exclude certain things, just so that there's no doubt about what's in and what's out and what the employers asked the Full Bench to do was to make it clear that a week's pay excludes various payments, namely overtime, penalty rates, disability allowances, shift allowances, special rates, fares and travelling time allowances, bonuses and any other ancillary payment of a like nature and the $40.50 that we're referring to here, well, if we can't find another name for it, it's certainly an ancillary payment of a like nature. It's one of those things that it's got a history to it, it's bolted on, it's not to the point, with respect, as Commissioner Lewin found, that everybody gets it every week. Well, everybody might get - - -

PN232

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Not everybody gets it. Part-time employees don't get it.

PN233

MR FORBES: Correct, it's only full-time employees.

PN234

SENIOR DEPUTY PRESIDENT CARTWRIGHT: They've got to pay the insurance premium, but they don't get this payment.

PN235

MR FORBES: I can't assist your Honour as to how that works. I don't know, but you're right, that's what it appears to say, so in our submission what Commissioner Lewin did was to really overlook or not take into account what we said about ordinary time rate of pay and I've said all this before, before Commissioner Lewin and he didn't really take it into account, it would appear and he found that because all the redundant employees were getting the $28 every week, well, that's part of a week's pay. My central point on all of this is that clause 13.3.6 is the clause which says week's pay means ordinary time rate of pay. It actually says ordinary time rate of pay for the employee concerned and the only work that that clause can have to do is that it must define week's pay. If it doesn't do that, it shouldn't be there.

PN236

What Commissioner Lewin appears to have done is to give a special meaning to ordinary time rate of pay because he said that the words for the employee concerned tacked on means it has to be given a special meaning. Now, with respect, those words are always there and invisible ink, anyway, because an ordinary time rate of pay must be an ordinary time rate of pay for someone, but Commissioner Lewin has said that those words for the employee concerned means or opens the door to take into account other things. In my submission, he just got that wrong and the reason he got it wrong in my submission is that and I say this with respect to Commissioner Lewin, but he brought a great deal of difficulty in construction to something that really is pretty simple and he oughtn't have left it alone. Ordinary time rate of pay is something that the parties should - that their understanding and knowledge of that expression should simply be inferred because of its notoriety.

PN237

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Doesn't the difficulty come from the interaction of that one with 13.3.1, the second paragraph, as you said before and then the fact that in 13.3.2, you've got week's pay as per point 1 and someone, I think it was you, made the point in the submissions that 13.3.6 was a later addition to this clause than the amendment to 13.3.2?

PN238

MR FORBES: I think that's right. That second paragraph presents a real dilemma because it doesn't seem to mean anything. It says that in this paragraph, week's rate of pay.

PN239

SENIOR DEPUTY PRESIDENT CARTWRIGHT: What I was getting at in asking the question is are there in fact two definitions in this clause 13.3.6 and the second paragraph, 13.3.1? When you say 13.3.6 is the definition, is that the only definition?

PN240

MR FORBES: It's the only definition of week's pay. You'll see, your Honour, that - - -

PN241

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Yes, 13.3.1, the second paragraph, is week's rate of pay.

PN242

MR FORBES: Week's rate of pay and you won't find that anywhere else. That's the dilemma. You won't find that week's rate of pay anywhere else. These things obviously have a life and a history of their own and we wouldn't be here if we all understood what it meant, but certainly week's pay, that expression is defined in 13.3.6 and in my submission, week's rate of pay is something that probably belongs to an earlier agreement, but ought be read as meaning week's pay. For this to work, there can only be one definition. The way in which 13.3.6 stands tall there on its own is in my submission in the context of this clause fairly apparent.

PN243

It's saying that's what a week's pay is, it's the ordinary time rate of pay for an employee and that makes sense because the ordinary time rate of pay or week's pay, whichever one you want to use, is the normal criteria used in the Commission's redundancy case and redundancy clauses. Pretty well everywhere you'll find the way in which - well, in all manner of things that the authorities refer to. What we say in conclusion is that, your Honour, Senior Deputy President Harrison I think or Senior Deputy President Cartwright raised the issue of annual leave and there was some evidence on that and that will be found at Mr Jury's affidavit page 96 at 26 and 27 and Senior Deputy President Harrison, you were right, it refers to those leaves being calculated in lots of eight hours and paid.

PN244

Insofar as disposition of the appeal is concerned, we submit that the appeal should be allowed on the grounds that we advance, so those that have not been abandoned by us. The appropriate disposition ought be that the decision of Commissioner Lewin made on 4 October, the first decision, that that decision ought be quashed and in its place an order that the section 170LW application be dismissed in its entirety. As to leave, our submission is that it really ought be self evident in this case that leave ought be allowed. There are matters which have been raised, errors which have been identified which have been conceded by the union and the fact that the appeal ought be allowed or should be allowed on at least those conceded grounds in my submission shows that there is a clear public interest that that occur.

PN245

The questions raised in the appeal, your Honour, in particular the question going to the expression ordinary time rate of pay, is such that if this decision were allowed to stand, it would involve a departure from a line of authority and established industrial jurisprudence which is likely to cause confusion for those that follow and what Commissioner Lewin has done here is to depart from a clear line of authority and it's clearly in the public interest that it be brought back into line in that respect. There are jurisdictional arguments that I spoke about earlier, an important jurisdictional argument regarding what it is that the Commission can do when exercising its powers of private arbitration and the ventilation of that point on appeal and the fact that my opponent does not contest it in my submission shows that it's a matter of some gravity and it is a matter which corrupted what Commissioner Lewin did.

PN246

In my submission, leave to appeal ought be granted and the appeal should be allowed. Can I just indicate for the sake of completeness that if the Commission is against me on the shift allowance jurisdictional point, we do rely on our submissions to say that the shift allowance ought not have been allowed as a matter of construction because the shift allowance is one of those types of payments that falls outside ordinary time rate of pay and on the authorities, shift allowances is absolutely clear. That never gets counted. Unless there's any questions, those are my submissions.

PN247

SENIOR DEPUTY PRESIDENT HARRISON: Mr Johnson, how long do you think you might be?

PN248

MR JOHNSON: Your Honour, I would imagine I would probably take in the order of an hour or so.

PN249

SENIOR DEPUTY PRESIDENT HARRISON: Would it inconvenience either of you if we took a very short break now and sat on until we completed the matter?

PN250

MR JOHNSON: It won't inconvenience me, your Honour.

PN251

SENIOR DEPUTY PRESIDENT HARRISON: That would be our preference. We might just take a five minute break now.

<SHORT ADJOURNMENT [12.29PM]
<RESUMED [12.41PM]

PN252

SENIOR DEPUTY PRESIDENT HARRISON: Mr Johnson.

PN253

MR JOHNSON: Thank you, your Honour. Your Honour, it's our contention that the decision below by Commissioner Lewin was correctly decided. I've already indicated to the Commission that in relation to appeal grounds 2 to 4 that we are not contesting the basis upon which those appeal grounds have been put, but that is not a concession that the legitimacy of the decision may very well stand as the Commission sees it. This appeal matter really does go to an issue of construction in relation to clause 13 of the agreement and the interpretation by the Commissioner below of the historical provenance of that clause.

PN254

There's ancillary references to the accident make up clause and income insurance clause and also to the termination of employment clause, but the real crux of this matter is with clause 13. The TWU submits that when clause 13.3.1 and 13.3.2 are read by themselves, they make perfect sense in the way that the Commissioner below has construed them. We submit that clause 13.3.6 was an additional inclusion into the clause which only confuses issues and provides as my learned friend puts it an ultimate explanation or possible interpretation of the agreement.

PN255

I think my friend put it that there's only one possible definition that can be applied in relation to clause 13 in relation to week's pay. However, the problem is that the clause actually includes two such definitions and this was the problem that confronted Commissioner Lewin below in that he needed to examine the extrinsic material in order to provide meaning to what the intention of the parties was, the objective intention of the parties and the mutual understanding when making the agreement.

PN256

Clearly the Commissioner below decided that the words of clause 13.3 did not have a plain and ordinary meaning when read in the context of the clause and in the context of the agreement as a whole. The appellants have put the proposition in Kucks v CSR that words must be given their ordinary and usual meaning and it's my submission that to do so in this clause, clause 13, would be to merely provide a mechanical recitation of the words which does not actually provide an adequate meaning for the agreement to be properly construed by the Commission.

PN257

The formulaic approach to these sorts of matters is not what is generally regarded as sufficient when dealing with agreements that are often imperfectly made and where errors are sometimes made in drafting. This obviously was the point that the High Court - sorry, the court was making in Kucks, that the parties to an industrial agreement are not necessarily proficient lawyers who used to the fine tuning of words and are aware of all of the meanings that are accorded to them. The appellants make the point that the construction that ought be afforded clause 13 in particular is one where consistency of use is necessary in order to properly provide a basis for the decision that would on the appellant's contention follow. In the case cited by the appellants, SDAEA v Woolworths, Gray J made clear that:

PN258

In statutory construction, consistency of use is no more than a presumption and a fragile one at that.

PN259

The appellants have provided a copy of that decision at tab 2 in a binder that was provided to me. I am not sure whether that binder has equally been provided to you.

PN260

SENIOR DEPUTY PRESIDENT HARRISON: Usually that is something that we wouldn't allow Mr Forbes to, but is referred to in the submissions, is it not and as a result, of course, it will be considered.

PN261

MR JOHNSON: The reference is (2006) FCA 616. It's 152 IR 95. What I would draw the Commission's attention to in particular in that decision is the discussion at paragraphs 25 and 26 where the court says at the bottom of page 100:

PN262

It is easy to construe clause 38 as involving the importation of provisions relating to long service leave as a code on that subject, the content of which does not have to fit within the framework of the rest of the certified agreement as if the imported provisions contained a term other than ordinary pay with a different meaning.

PN263

In paragraph 26, the court goes on to discuss the decision in Clyne v Deputy Commissioner of Taxation and in particular the decision of Gibbs CJ where he described it as not a presumption of very much weight, being the presumption that a word used in one provision of a statute has the same meaning in another and he said:

PN264

There is no rigid rule. It all depends on the context.

PN265

And in the same case, Mason J said that:

PN266

The presumption readily yields to the context.

PN267

What we say is that this case here is all about the context. We're talking about a redundancy provision clause that was intended to provide specific entitlements to employees upon them being made redundant and what we would also say is that the point made by Gray J in relation to certified agreements where provisions are imported and contain other terms is a pertinent one because that's what we say has occurred here. In the hearing below, I don't believe that reference was made to this issue. However, when the Transport Workers Award 1983 existed, it contained clause 14 which was the clause on redundancy and what is obvious when you read the award as it existed then is that the entire slab of text from the award has been picked up and placed into clause 13 of the agreement with some amendments to numbering in terms of the numbering of the clauses. One of the terms that was picked up was clause 14.3.2 as it existed prior to its amendment by the redundancy test case decision and 14.3.2 is the sentence that reads:

PN268

Week's pay means the ordinary time rate of pay for the employee concerned.

PN269

When we look at the order by Commissioner Lewin in relation to varying that award on 9 August 2004 to ensure compliance with the redundancy test case provision, as noted by the appellants, the definition of that clause is amended and it's amended to reflect obviously the test case provision and the exceptions to the definition of ordinary time rate of pay expanded upon in that order. What the parties to this agreement chose not to do was to pick up in clause 13 the exceptions that were detailed in the award and as highlighted by the appellants. They chose to retain the text of the award as it had been picked up and put into the agreement similarly in nature to the way that they had picked up the text from the 1998 Clelands agreement on redundancy and put that into clause 13 of the agreement.

PN270

Commissioner Lewin has been faced with a position where there are conflicting definitions in terms of week's pay. As your Honour Senior Deputy President Cartwright correctly pointed out, there was an inclusion in clause 13.3.1 in the second paragraph of week's pay and the meaning of week's pay which the appellants have conceded preceded the inclusion in that clause of 13.3.6. What we say is that 13.3.1 in the second paragraph has a reference to in this paragraph at the start of that sentence and that carries particular weight because it is specifically relating or linking that sentence to the entirety of clause 13.

PN271

SENIOR DEPUTY PRESIDENT CARTWRIGHT: 13, rather than 13.3?

PN272

MR JOHNSON: Sorry, the entirety of clause 13, I would say.

PN273

SENIOR DEPUTY PRESIDENT CARTWRIGHT: But why do you say clause 13 as opposed to 13.3, because it says in this paragraph? Paragraph 13.3 or all of 13?

PN274

MR JOHNSON: I would have said all of 13 because I think for the sentence to be given proper meaning, the clarity with which those words have been used is perhaps not at the highest level. However, I believe that the intention would be for it to carry throughout the entirety of the clause. Often in my experience, the use of paragraph and clause are interchangeable terms between parties when they're referring to a particular clause of an agreement.

PN275

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Yes. The reason I ask is if you read 13.2, 13.2 is interesting in that it's talking about notice and so there appears to be in it a reaction between 13.2 and 13.3.2, but there's also an interaction between 13.2 and 13.3.6 because when you're doing the calculations under 13.2, the reference is to ordinary time rate of pay which appears to be the term used in 13.3.6.

PN276

MR JOHNSON: Yes, my apologies, your Honour. Thank you for pointing that out. On reading that, it's become clear to me that 13.3 is in fact the clause which has been lifted from the 1998 redundancy agreement with Clelands, whereas the remainder of clause 13 is the slab which was lifted from the award and thank you for raising that to my awareness because after reviewing that, I would submit that the second paragraph of clause 13.3.1 refers to the week's pay within clause 13.3.

PN277

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Yes, so paragraph there is restricted to 13.3?

PN278

MR JOHNSON: Yes, that would be my submission, your Honour.

PN279

SENIOR DEPUTY PRESIDENT CARTWRIGHT: But read as a whole, if you look at 13, what do you say is the interaction between 13.2 and 13.3 and, you see, thinking about notice, 13.4 and 13.5 also refer to period of notice, notice of termination, et cetera, et cetera and so I asked the same thing of Mr Forbes and you don't need to address it now, just wherever it's relevant in how you want to tackle this, you might talk about the interaction of those clauses and what it all means.

PN280

MR JOHNSON: I had intended to do that, your Honour, but superficially I would indicate that clause 13.2 relates to obviously the transfer to lower paid duties. It doesn't necessarily have a direct relationship to 13.3.2. As the Commissioner below found and we say correctly, 13.3.2 provides an additional entitlement that essentially stands alone in circumstances where an employee is made redundant such that the other provisions relating to notice within that clause 13, such as 13.4 and 13.5, relate to the notice period provided for by clause 12 of the agreement.

PN281

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Why do you say that? Why isn't 13.2 referring to the notice of termination in 13.3.2?

PN282

MR JOHNSON: Because there is no provision for notice in there. It's a provision for payment, not for notice. There are no provisions for notice in a clause. The only provisions for notice exist in clause 12.

PN283

SENIOR DEPUTY PRESIDENT CARTWRIGHT: What is the purpose of the heading, then, 13.3.2, notice of termination?

PN284

MR JOHNSON: I would submit that that's a loose adoption of the words of the award which have merely been cut and pasted, similarly to the way in which the words have been cut and pasted from the redundancy agreement, the 1998 agreement. I would say that really the provision there is talking about payment and this goes to the intention of the parties which Commissioner Lewin referred to when the parties created the 1998 redundancy agreement and deleted the words notice or from that provision in that redundancy agreement.

PN285

SENIOR DEPUTY PRESIDENT CARTWRIGHT: When you follow the logic of clause 13, paragraph 13.1 talks about essentially when redundancy occurs, 13.2 then says, well - I mean, this is a very broad characterisation, but instead of being made redundant, you can be transferred to lower paid duties. Now, if you are, there is a provision there about what the notice should be for that transfer and any payment that should be made and then you come on to 13.3 so if you are made redundant, 13.3 then deals with what happens and then you've got 13.4 and 13.5 which also have references to periods of notice.

PN286

MR JOHNSON: Yes. However, the difficulty as I see it is that there is no provision for notice, whereas in clause 12 there is, so I would say that those provisions cannot operate without reference to clause 12 and as the Commissioner below decided, necessarily I would say, clause 13 does operate as a code. However, it operates as a code which incorporates the relevant clauses regarding the notice in clause 12. We further say that clause 13.3.2 was therefore intended by the parties when read in the context of the 1998 agreement to provide a further additional benefit to employees in the circumstances where they're made redundant and as your Honour has noted before, that's not an unusual circumstance for that to arise where redundancies are being implemented.

PN287

COMMISSIONER FOGGO: But would you say it's an unusual circumstance to the extent that as this agreement does, it has various categories of termination of employment, as a termination of employment arising under clause 12 which has various periods of notice you've got a different type of termination under redundancy and that's dealt with by its own clauses? I mean, why do you make this link that because the five weeks is given for redundancy that it flows that it's in addition to 12.1.1?

PN288

MR JOHNSON: Commissioner, because it stands separate to 12.1.1, this is a clause which has been inserted specifically into the redundancy clause.

PN289

COMMISSIONER FOGGO: To deal with redundancy?

PN290

MR JOHNSON: To deal with redundancy, but in addition to their termination because there is the termination and then there's the redundancy that occurs as well, so the termination is by way of redundancy. If the termination was to occur in any event, the obligation would fall to the appellant to either pay the notice or make the payment in lieu of the notice in accordance with clause 12 of the agreement, but where the termination is by way of redundancy, then additional obligations fall upon the appellant to provide what we say is the five weeks' pay.

PN291

SENIOR DEPUTY PRESIDENT CARTWRIGHT: So does that mean in 13.2 if an employee who has been employed one year, but less than two, is to be transferred to a lower paid job, they get two weeks' notice of that transfer?

PN292

MR JOHNSON: That's how I would read it, your Honour, and I believe that that's how Commissioner Lewin read the provision as well. However, what the Commissioner found was that if that person was then made redundant, that they would be entitled to the five weeks in addition to that notice of two weeks which would otherwise be entitled to them.

PN293

SENIOR DEPUTY PRESIDENT CARTWRIGHT: I understand what the decision dealt with. I guess I was just looking for your submission on what the interaction is between 13.2 and 13.3 and 13.4 and 13.5 relating to those different notice periods. Essentially, are you putting that in 13.2 the reference to notice has got to be back to clause 12, similarly in 13.4 and 13.5 the reference would be back to clause 12, but 13.3.2, notice of termination, is not taken to deal with notice at all?

PN294

MR JOHNSON: I would submit, your Honour, that it's merely a result of that picking up of terminology from the 1998 agreement which perhaps should have been expressed as an entitlement to payment rather than with the heading notice of termination because it does introduce an element of confusion. However, what I think we need to look at is the substance of what the intention of the parties was when viewed objectively as opposed to the words, in particular the words notice of termination in the heading of 13.3.2.

PN295

SENIOR DEPUTY PRESIDENT CARTWRIGHT: What was the heading back in 1998? I recognise that you only get to extrinsic materials if you need to get there, but what did it say? I've just forgotten, where is the - what page was that? Here we are, it's page 90. The heading then was notice of termination and presumably the heading always since has been notice of termination.

PN296

MR JOHNSON: That's consistent with what I am saying, your Honour, in that it's merely something which has been picked up as a slab of text and inserted into clause 13, similarly to the way in which the award provisions relating to the other entitlements have been.

PN297

SENIOR DEPUTY PRESIDENT CARTWRIGHT: So are you saying that essentially you've got clause 13 here and it follows a logical structure in how it's laid out and 13.2 and 13.4 and 13.5 when they talk about periods of notice, et cetera, they refer to clause 12, but when you plonk down 13.3 in the middle of this clause, the notice of termination in the heading now doesn't refer to anything.

PN298

MR JOHNSON: That's correct, your Honour, that is my submission and just on that point as well, the appellants sought to have the Commission imply the words notice or back into the clause 13.3.2 which obviously had its heritage in clause 2 of the 1998 agreement and what we submit is that the rules regarding the implication of terms into contracts are relatively strict and we would say that the appellants have not discharged the necessary requirements that exist for such an implication of terms to be made.

PN299

We say that on the basis that - I haven't got the case with me, but in the case of BP v The Shire of Hastings, the High Court very clearly set out the requirements needed for the implication of terms to be made and that's where there is no other explanation that is otherwise available on the face of the document and we would say that there certainly is an explanation which is available and the explanation is available by way of the definition that's provided for week's pay in the second sentence of paragraph 13.3.1.

PN300

You don't need to imply the words in 13.3.2, notice or, in order to give that clause meaning or effect. When the heritage of the clause is examined and we can see that there is on the face of the document a very clear notation which is initialled by both parties to the 1998 agreement, the deletion has been made of those exact words, notice or and we submit as was submitted in the matter below that that was done with the intention of providing an entitlement of five weeks' pay to people upon them being made redundant or terminated by way of redundancy.

PN301

SENIOR DEPUTY PRESIDENT CARTWRIGHT: But it's now been put into the middle of a clause that does other things as well, so why would we think that the meaning - in putting it into a clause which has a different context, why would we still import the same meaning that was devoid of that context? Sorry, that's not putting it very elegantly.

PN302

MR JOHNSON: I understand the point you're making, but I think it goes to what the objective - - -

PN303

SENIOR DEPUTY PRESIDENT CARTWRIGHT: In other words, going into the context of the meaning change.

PN304

MR JOHNSON: I think it goes to the objective intention of the parties when they've done that and I think it is clear that the intention was to provide as the Commissioner below found a further additional entitlement upon the circumstances where someone is terminated by way of redundancy that exists in addition to the notice that would otherwise be available in any ordinary termination by way of clause 12.

PN305

COMMISSIONER FOGGO: Yes, it's a superior amount that's provided at redundancy, but what do you say to the notion that, taking your view on it, that there's a double dipping that's occurring?

PN306

MR JOHNSON: I don't agree that it's a double dipping in any sense because it's a specific provision that's been included by the parties for the purpose of providing additional benefits upon someone being made redundant. I would say that the notice of termination provided in clause 12 exists as a natural course in any termination and that the five weeks' pay referred to in 13.3.2 is an additional entitlement that was agreed between the parties.

PN307

COMMISSIONER FOGGO: As a special provision to take into account the circumstances of redundancy?

PN308

MR JOHNSON: That's right. Now, I have made reference to the principles of construction and interpretation in my outline of submissions and I rely on my outline of submissions in that sense and also draw the Commission's attention in particular to the decision of the Full Bench in Telstra Corporation Ltd which is referred to and the principles for ascertaining the mutual intention of parties. Now, that was in relation to an application under section 170MD(6)(a) of the Act, but it does on my submission provide the proper principles for the approach that should be adopted in this case.

PN309

That extract is drawn out in paragraph 10 of my outline, but in particular I wish to address the ground of appeal that relates to a purported error by Commissioner Lewin insofar as he failed to have regard to - I withdraw that - in that he was not entitled to examine the extrinsic material that existed by way of the 1998 agreement. It's our submission that the 1998 agreement was open for Commissioner Lewin to examine on the basis that it represented surrounding circumstances which evidenced prior negotiations and established the objective background facts which were known to both parties and also the subject matter of the agreement. It is an entirely proper and ordinary approach for him to take given the conflict that exists between the operation of clause 13.3.6 and clause 13.3.1 and 2.

PN310

I made reference earlier to the grounds 2 and 4 which as I indicated are not being contested. However, the Commission indicated that there is some reluctance to approach these issues in a more general basis. We would submit that whilst we're not contesting the issue because it was previously conceded that if the Commission turns its mind to this issue, it ought limit the circumstances in which parties may affect their rights in the prosecution of a case, particularly where all of the evidence has been heard. I won't go further than that, but the company has made the submission that the Commissioner below should not have considered as I mention the 1998 agreement and that no evidence was heard in relation to the making of that agreement or the basis upon which the parties agreed to it and that therefore no mutual intention can be attributed by the Commissioner to the parties.

PN311

However, what we say is that there is a concession by the appellants that no direct evidence of any negotiation exists, so in light of the appellant's own submission that no evidence exists, it was open to Commissioner Lewin to examine the existence of the 1998 agreement as he did on its face without considering any other evidence which ought have been put before the Commission. It is impossible to put evidence that does not exist. In relation to the $28, the first thing that I would note is that it was the union's submission in the matter below that the amount that ought to have been included as part of the week's pay for the purposes of the severance payment was $40.50.

PN312

That is the payment that was indicated in paragraph 1.2 of the memorandum of understanding as being the entitlement of employees. The deduction of $12.50 for the accident make up premium would have absolutely no work to do or would serve no purpose in the circumstances of redundancy because the employee is no longer performing work during the course of that period, so it's our submission that the amount which ought to have been included for the purposes of the severance payment was in fact $40.50, not $28.

PN313

SENIOR DEPUTY PRESIDENT HARRISON: That was your position before the Commissioner, was it?

PN314

MR JOHNSON: Yes. I think that that is indicated in the outline of argument. I will just find that for your Honour.

PN315

SENIOR DEPUTY PRESIDENT CARTWRIGHT: You will find Mr Forbes took us to that in the listing of the claims.

PN316

MR JOHNSON: Yes. It's at page 236 of the appeal book and it's point number 2 that:

PN317

The union is seeking that the company pay the $40.50 per week.

PN318

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Does this mean it's a cross appeal, Mr Johnson?

PN319

SENIOR DEPUTY PRESIDENT HARRISON: No, I am sure there is not.

PN320

MR JOHNSON: No. That's correct, your Honour. I merely note it for the attention of the Commission. The evidence of Mr Jury regarding the $28 was that on the words of the appellants this was an over award payment or incentive. What we say is that this fits very clearly into the definitions that are provided by a ruling by the Australian Taxation Office which is a superannuation guarantee ruling on ordinary time earnings, SGR94/4. What I would seek to do is to hand up copies of this ruling for the benefit of the Commission. I have previously provided a copy of this to the appellant's representative and I would seek to tender this, your Honour. This is a document which we say is further evidence relevant to the decision which the Commission will be required to make in this matter and that it falls within the parameters of documents that are able to be tendered in appeals.

PN321

SENIOR DEPUTY PRESIDENT HARRISON: Mr Johnson, I've had a little bit to do with rulings on ordinary time earnings and definitions of ordinary time earnings in awards, not surprisingly transport workers' awards, so take me back again how this relates to the construction you urge that we place on clause 1.2 in the rates of pay clause, given that there is no cross appeal, so in effect what you're doing is supporting the correctness of the Commissioner's dealing of $28. What has this got to do with that?

PN322

MR JOHNSON: Your Honour, this contains definitions of allowances which work in quite a limited scope.

PN323

SENIOR DEPUTY PRESIDENT HARRISON: There is a free-standing transport workers' superannuation award, isn't there?

PN324

MR JOHNSON: Yes, there is.

PN325

SENIOR DEPUTY PRESIDENT HARRISON: I can't remember if it's the default award or how precisely it is to be read in conjunction with other awards, then in turn EBAs. I just don't know.

PN326

MR JOHNSON: I can't inform your Honour further on that particular point.

PN327

SENIOR DEPUTY PRESIDENT HARRISON: These are some of the reasons why I am very nervous about the context of the discrete issue before us, buying into this, because I do know the significance, potential significance. Anyway, I will stay with what you're arguing. This is going to help us with - - -

PN328

MR JOHNSON: This is in relation to the $28 or what we would say should properly be the $40.50.

PN329

SENIOR DEPUTY PRESIDENT HARRISON: Mr Johnson, you can't just make that submission. There is no cross appeal.

PN330

MR JOHNSON: That's correct, your Honour.

PN331

SENIOR DEPUTY PRESIDENT HARRISON: So don't do that to us. Either raise it fair and square and we'll ask Mr Forbes what his attitude is to a cross appeal being raised at this stage or don't say it again.

PN332

MR JOHNSON: Certainly. Thank you, your Honour.

PN333

SENIOR DEPUTY PRESIDENT HARRISON: Just support the $28 or say what you want to about supporting that.

PN334

MR JOHNSON: Yes. In relation to the $28, your Honour, paragraph 20 talks about what is an allowance and it says:

PN335

An allowance is a payment of a definite predetermined amount to cover an estimated expense paid regardless of whether the employee incurs the expected expense, the employee has the discretion whether or not expend the expense.

PN336

And it talks about reimbursements. Over on the next page at paragraph 24, it talks about bonuses and it says:

PN337

Bonuses will form part of an employee's ordinary time earnings where the bonus is paid in respect of ordinary hours of work.

PN338

And it goes to a CCH Macquarie Dictionary of Employment and Industrial Relations definition which says:

PN339

A payment above the regular basic rate or standard of pay, eg. a payment for overtime or shift work for attendance and allowance for work under exceptional conditions as well as an incentive payment made under a piecework system for incentive scheme or as a production bonus.

PN340

Paragraph 25 says:

PN341

All of these payments, excluding payments for overtime, would form part of an employee's ordinary time earnings.

PN342

And it's that clause which we say indicates that certainly the $28 referred to is capable of definition not as an allowance, as the appellant seeks to do, but more so as a bonus which under this ruling would form part of the employee's ordinary time earnings. We say that the $28 is an amount which is payable regardless of the work that's performed. It's not payable in reference to any disability or industry allowance. It's not payable in terms of a compensatory element. It's not paid as some sort of reimbursement. It's paid as an absolute entitlement regardless of the number of hours a full-time employee works.

PN343

I note Senior Deputy President Cartwright's observation that the payment does not apply to part-time employees and I cannot further illuminate the Commission as to why that is the case. However, it does not change the entitlement which we say should properly fall to full-time employees in circumstances where they're made redundant. We say that the $28 ought properly be considered part of the week's pay for the purposes of clause 13.3.1.

PN344

SENIOR DEPUTY PRESIDENT CARTWRIGHT: So does it follow that if a part-time employee was made redundant, it wouldn't form part of the week's pay there?

PN345

MR JOHNSON: It's only applicable to full-time employees, so for all intents and purposes, part-time employees and full-time employees have different rates of pay in that sense, yes.

PN346

SENIOR DEPUTY PRESIDENT CARTWRIGHT: I mean, they have different rates of pay in that the part-time is pro rata, but in the calculation, this would be excluded altogether for a part-timer whereas it would be part of the calculation for a full-time employee?

PN347

MR JOHNSON: That would necessarily be the case, yes, your Honour.

PN348

SENIOR DEPUTY PRESIDENT CARTWRIGHT: It logically follows, doesn't it?

PN349

MR JOHNSON: Yes, and we say that that payment, it's not contingent on the performance of any work as such. For the Commission's benefit, there is a further decision which I did not outline earlier in terms of our submissions and list of authorities, but that is a decision of the Industrial Relations Commission of New South Wales in Police Association of New South Wales v Commissioner of Police. The reference is (2002) NSWIRC 126 and it's 123 IR 301. This decision deals in part with the payment of a loading for a police officer that was suspended with pay and part of the issue there was whether or not that 10 per cent loading ought properly form part of the pay to which the police officer was entitled when suspended.

PN350

The court found that the 10 per cent salary loading was payable to him and during the decision considered the principles to be applied in constructing or construing legislative provisions. I draw the Commission's attention in particular to paragraph 41 of the decision in relation to the construction issue and my point about the context being relevant to clause 13 and in particular the citation of the High Court decision in Scott v Commissioner of Taxation and K and S Lake City Freighters Pty Ltd v Gordon and Gotch Ltd where the court refers to the problems of ritual incantations of terms which emphasise the clarity of meaning of words when read in isolation, but when they're divorced from their context and how that is not helpful to gaining a meaning that ought properly be arrived at. In relation to the $28 question, this decision deals with the concept of pay as distinguished from the concept of salary and other types of payment such as income or remuneration and concludes that:

PN351

The term pay is wide enough to include and is intended to include both the salary and the loading set out in the respective award clauses.

PN352

And that is on page 323 of the decision, about halfway down at paragraph 60.

PN353

SENIOR DEPUTY PRESIDENT CARTWRIGHT: I am just thinking, Mr Johnson, your reference to needing to interpret within the context and going back to 13.3.2, doesn't that give you a problem in the way you submitted 13.3.2 should therefore be interpreted in that to come up with the meaning you suggest, you have to withdraw it from its context, where the context is notice of termination and 13.3.2 appears to deal with notice of termination?

PN354

MR JOHNSON: I agree that there are contradictory terms in the clause which give rise to the confusion that we're now seeking to deal with. However, I think that the principles of construction remain in that the authorities generally talk about terms needing to be read in their context rather than pulled out and read as the High Court said, a ritual incantation of terms.

PN355

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Yes, sorry, I don't want to distract you from your current line, but you referring to that really brought back to mind the difficulty of 13.3.2.

PN356

MR JOHNSON: Your Honour, what I would say is that the entirety of clause 13 needs to be read within the context of the 1998 redundancy agreement and the inclusion of terms in clause 13 from that agreement and also the award provisions and the inclusion of terms from the award in the remainder of clause 13. It would be self serving I suppose to say that you ought therefore prefer my approach as opposed to the appellant's. However, that's what I intend to do, but it's on the basis of several points, namely the words in this paragraph preceding the words week's pay in the second sentence of clause 13.3.1 and also as I've referred to earlier, the incorporation of 13.3.6 from the award and the failure to amend 13.3.6 to reflect the subsequent amendments that were made when the redundancy test case was conducted. I am not sure if that assists your Honour.

PN357

SENIOR DEPUTY PRESIDENT CARTWRIGHT: Yes. Sorry, I didn't want to distract you, but just your reference immediately cast my mind back to the previous discussion we had.

PN358

MR JOHNSON: Yes. Suffice to say that we submit that authority as the basis that the term pay and in particular week's pay does have some authority behind it as representing an expansive definition of pay which we submit has the capacity of having included within it the $28 referenced in clause 1.2 of the memorandum of understanding.

PN359

SENIOR DEPUTY PRESIDENT CARTWRIGHT: What do you do with - the memorandum of understanding really only has one heading. It's 1, rates of pay and then in separate sections of 1 it deals with - there is the table then there is the $40.50, then there's the reference to hours in 3 and 4 and you go on to 2 which deals with essentially retaining understandings that are operating at the workplace as I take it. What does rates of pay apply to there? Put more correctly, does the heading do any work, given that it appears to apply to a multitude of things, some of which are not paid?

PN360

MR JOHNSON: Your Honour, we would submit that the heading rates of pay indicates that those provisions within the clause that relate to the rates of pay are inclusive within the definition of rates of pay for the purposes of the agreement and in particular obviously 1.2 specifies an amount which is included within the rates of pay and as I indicated before, it's an entitlement. This is a very good example of the imprecise nature of industrial agreements and the way in which they don't necessarily accord with normal principles of contracts that may be more precisely expressed.

PN361

However, once again I think we need to look at the intention of the parties and the intention of the parties is very clearly to provide a minimum entitlement which employees get regardless of the performance of additional work or specific work and what we say is that when it is examined in that context that the rate of pay incorporates the $28 found to be applicable as part of the week's pay definition by the Commissioner below. Your Honour Senior Deputy President Cartwright correctly identified that clause 18.3.3 entitled an employee to retain their weekly pay should they choose not to have income insurance and we would say that that is a further indication of this requirement that the employer pay as a minimum the rate of pay inclusive of the $28.

PN362

The union submits that the Commissioner has followed the processes that were open to him and has correctly construed the agreement in terms of the inclusion of $28 as the payment which forms part of the week's pay for the purposes of the severance payment and also in relation to the payment of five weeks' pay upon making an employee redundant which operates as an additional or further entitlement to that notice period which exists in clause 12 of the agreement. We submit that at least in relation to those grounds of appeal that relate to those issues, there was no error engaged in by the Commissioner and that certainly those grounds of appeal ought be dismissed.

PN363

That is not to say that we concede that leave to appeal should be granted. However, obviously that is a matter for the Commission to determine in any event. What we do say about the leave to appeal is that this is a matter which is limited in its application to the parties to this agreement and has no wider ramification or implication for other parties. It's only the parties to this agreement that are affected by it. There's no public interest served by leave to appeal being granted on that basis and unless the Commission has any further questions for me, I believe that is the end of my submission.

PN364

SENIOR DEPUTY PRESIDENT HARRISON: Thanks, Mr Johnson.

PN365

MR JOHNSON: Thank you.

PN366

SENIOR DEPUTY PRESIDENT HARRISON: Anything in reply, Mr Forbes?

PN367

MR FORBES: Just a few brief points, your Honour. Can I just say the Commission won't be assisted by either the superannuation guarantee ruling or the Police Association case that my learned friend took you to. The superannuation guarantee ruling deals with the issue of ordinary time earnings. That's not what we're dealing with here. In this case we're dealing with ordinary time rate of pay. It has its own industrial wording behind it. The fact that the commonwealth government has decided to define an expression ordinary time earnings to include all manner of things might have more to do with the tax they want to raise than what it really means, so we're not dealing with that expression, so it's simply irrelevant.

PN368

The Police Association case when the Commission gets a chance to have a look at it as I have only briefly deals with first of all statutory construction which is a different matter to construction of enterprise agreements. Construction of enterprise agreements with Kucks, Telstra and other cases again has its own learning behind it and it is a different approach, but more importantly, the Police Association case deals with the expressions pay and salary which again is not what we're dealing with here. What we are dealing with as I have already said probably enough is that 13.3.6 is a section of definition put in there so that if there's any argument about what week's pay means in the context of clause 13, it means ordinary time rate of pay.

PN369

SENIOR DEPUTY PRESIDENT CARTWRIGHT: What do you say if anything about the significance of that term being used in 13.2?

PN370

MR FORBES: I think the significance of it is that as my learned friend said, that's probably been cut out of the TWU award, the Transport Workers Award, but the significance of it would be that if you interpret week's pay to mean ordinary time rate of pay as we say, it brings a consistency to all of clause 13. There's then a nice consistency that flows through the entire clause. Now, Senior Deputy President Cartwright put a proposition which, with respect, I think brings the union's submissions into very sharp focus and that was that 13.2, 13.4 and 13.5 all need to be read in conjunction with clause 12 on the union's submission and that clause 13.3.2 which deals with notice of termination doesn't deal with notice at all.

PN371

Now, that observation is with respect a very astute one. It shows the ridiculous nature of the submissions being put. Insofar as the principles of construction and interpretation of enterprise agreements are concerned, I note that the union's submission relies or cites various authorities such as Codelfa and so forth which deal with contractual construction. That's not to say that that is irrelevant. Certainly the Federal Court seems to be more and more inclined to look at contractual principles for the purpose of constructive industrial agreements, but there is a body of accepted or well accepted learning with Kucks and other decisions that there is a way of reading an enterprise agreement and one reads it primarily to give life to the words that are actually used. One doesn't go looking for meaning in other documents unless one has to.

PN372

A point was made that no words ought be implied into the notice provision and as you will be aware, we say for it to make sense, one should imply the words notice or and my learned friend mentioned the BP Westernport case. That, of course, is a case which deals with the implication of terms into contracts, but in any event, one of the bases on which the High Court says one can imply things into documents is where it is so notorious as to go without saying and in our submission it almost goes without saying that when you look at 13.3.2, the words notice or are there in invisible ink or ought be there in invisible ink.

PN373

Insofar as 13.3.6 is concerned, the definitional provision, I think it's common ground between us that that was introduced into the series of enterprise agreements in 2000. It wasn't there before 2000 so insofar as it is a definitional provision introduced into the agreement in 2000, one should regard it as a specific provision and, of course, the normal canons of construction would provide that the specific will override the general. That's why it's there and it points to the importance of clause 13.3.6 as setting the parameters of what week's pay mean for the purposes of 13.

PN374

My learned friend made some comments about the TWU award and amendments to the award and various other things, but none of that seems to have been part of the evidence considered by Commissioner Lewin in any event and I simply don't think it's relevant. Insofar as the $28 is concerned, just so that there is no misunderstanding of what we say, whilst it's been referred to as an incentive allowance in the past, in my submission it's not necessary for us to establish that it's actually an allowance for it to fall outside ordinary time earnings. It's a payment of a different character to ordinary time earnings.

PN375

It's the sort of thing that the Full Bench in the 2004 redundancy case referred to as an ancillary payment or something of that kind, so whether it's an allowance or not really isn't to the point. Just one final point that I picked up in my learned friend's written submission and that is that he referred to the fact that in 2003 and this is at paragraph 20 of his written submissions dealing with the five weeks payment and the $28, he made the comment that back in 2003 six employees were made redundant and that they were paid the five weeks and the $28. That in my submission carries very little probative value. When you have an opportunity to look at the SDA v Woolworths case, the decision of Gray J, you will see that Gray J made the observation that that kind of evidence, that is the evidence of what parties might have done in the past is in fact liable to mislead. It needs to be treated with very great caution. It may be that the parties operated both under a misapprehension, these things happen, but when it comes to construing an agreement, one has to tread extremely cautiously about relying on what happened in the past. That's all I have in reply.

PN376

SENIOR DEPUTY PRESIDENT HARRISON: I don't think I marked your submissions, Mr Johnson. I overlooked that.

EXHIBIT #R1 OUTLINE OF SUBMISSIONS

PN377

COMMISSIONER FOGGO: Isn't it wonderful that the parties are going to have an opportunity in their future to correct all these errors that appear in their industrial agreements.

PN378

MR FORBES: Mid next year, I think.

PN379

SENIOR DEPUTY PRESIDENT HARRISON: Thank you for the submissions. The Full Bench will reserve its decision. Before I adjourn, may I indicate that I wish to have a brief conversation with Mr Johnson and Mr Smith. You can, of course, assume it has nothing at all to do with this appeal and something to do with the matter raised by Commissioner Foggo, so I might just come back into the court room after we adjourn for a short period for that sole purpose. The Commission now adjourns.

<ADJOURNED INDEFINITELY [1.50PM]

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #A1 OUTLINE OF SUBMISSIONS PN34
EXHIBIT #R1 OUTLINE OF SUBMISSIONS PN376