C2012/6579, Transcript of Proceedings [2013] FWCTrans 453 (4 June 2013)

TRANSCRIPT OF PROCEEDINGS

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Fair Work Act 2009 1048116-1

DEPUTY PRESIDENT SAMS

C2012/6579

s.739 - Application to deal with a dispute

Ferrymen Pty Ltd
and
Maritime Union of Australia, The
(C2012/6579)
FPL Enterprise Agreement

(ODN AG2010/13396)
[AE878862 Print ]]



Sydney

10.03AM, FRIDAY, 24 MAY 2013

Reserved for Decision

Continued from 23/05/2013

PN1233

THE DEPUTY PRESIDENT: Yes, Ms Doust.

PN1234

MS L. DOUST: Yes, your Honour, if I can tender the witness statement of Paul Garrett.

PN1235

THE DEPUTY PRESIDENT: Any objection?

PN1236

MR A. MOSES: No, your Honour. Your Honour would have seen that much of the statement is basically a collation of what Mr Garrett understands to be the appropriate legislative and regulatory framework within what he understands to be the industry. That’s just a matter of submission, which I’ll see how it’s deployed by my learned friend in her submissions but we’ll reply if necessary.

PN1237

THE DEPUTY PRESIDENT: Yes. All right, I’ll mark the witness statement of Paul Garrett exhibit Q.

EXHIBIT #Q WITNESS STATEMENT OF PAUL GARRETT

PN1238

MS DOUST: Thank you. I have a copy if the commission requires one.

PN1239

THE DEPUTY PRESIDENT: I have it.

PN1240

MS DOUST: Yes, thank you. Your Honour, there’s one more thing and I propose to tender an extract from the Australian Fair Pay Commission Wage Setting decision and reasons for decision from July 2009, just the extract showing what the minimum wage was at the relevant time, which was $14.31 an hour, which on a weekly basis at 38 hours was $543.78.

PN1241

THE DEPUTY PRESIDENT: Any objection?

PN1242

MR MOSES: No, your Honour.

PN1243

THE DEPUTY PRESIDENT: I’ll mark the extract from the Australian Fair Pay Commission decision of July 2009 exhibit R.

EXHIBIT #R EXTRACT FROM THE AUSTRALIAN FAIR PAY COMMISSION DECISION OF JULY 2009

PN1244

MS DOUST: Thank you. That’s all that the respondent has to rely upon apart from the written submissions, which I hope your Honour has a copy of.

PN1245

THE DEPUTY PRESIDENT: Yes, I’ll come to those.

PN1246

MS DOUST: Thank you, your Honour.

PN1247

MR MOSES: Yes, thank you, your Honour. Your Honour, the parties have filed witness submissions so I won’t seek to traverse those issues but we have a few matters that we wish to emphasise. As I indicated at the outset yesterday there are two issues which arise in this application that require resolution by the commission, and that is the interpretation of clause 12.2 of the enterprise agreement and clause 14(c). In order to resolve the first issue the commission of course will need to apply the interpretation principles that arise from decisions of this commission and the High Court and the Federal Court concerning the interpretation of industrial instruments. The applicant contends that clause 12.2 cannot impose the obligations on it contended by the respondent union as indicated, as I said yesterday, your Honour, in paragraph 128 of their written submissions.

PN1248

The respondent appears to assert that clause 12.2 is ambiguous such that the commission is permitted to look at extrinsic material concerning the surrounding circumstances of the clause and to that end yesterday, your Honour heard much cross-examination of the witnesses of the applicant, Ms Cooper and Mr Eades. It’s important to note at the outset, your Honour, that the applicant never agreed to the term that is contended for by the respondent union in their submissions. In fact the applicant was of the view, as indicated by Mr Eades yesterday the modern award did not apply and so too, your Honour, did the other parties to the agreement - at least the representative of the employees, the solicitor, and I took your Honour yesterday at the outset to page 12 of Ms Cooper’s statement which indicated there the letter from the solicitors for the employees that it was also his view.

PN1249

So there was a position by both parties to the agreement at the time that it was agreed and then proposed before the commission that the modern award did not apply. There were musings that went on prior to the matter and discussions between the solicitor, Ms Cooper and Mr Eades Senior in respect of the applicability of the award but there was uncertainty concerning the matter. The evidence demonstrates that certainly by 13 May, which is exhibit O in these proceedings, a position had been reached by Ms Cooper of expressing a view that the modern award did not apply. Following that was the correspondence from the solicitors for the employees.

PN1250

What paragraph 128 of our learned friend’s submissions is said to do is urge upon the commission an interpretation of the clause that neither party to the agreement contended for at the time, it was not within their contemplation and no evidence led by the respondent union from any person on that issue. Of course, your Honour, there are occasions where it is not possible to resolve terms in a statute or instrument even in circumstances where the commission has before it the relevant extrinsic material and can I just provide your Honour with the bundle of authorities.

PN1251

Can I ask your Honour to have recourse to the first judgment in the bundle, which is that of Justice North in Automotive Food Metals Engineering, Printing and Kindred Industries Union v Qantas Airways Ltd [2001] FCA 547; (2001) 106 IR 307. I’ll just draw your Honour’s attention to paragraph 66, which makes the point of course that the onus is on the party asserting a construction for which they contend is correct. In that case, of course, your Honour would note, there was a finding by the judge that the language and structure of the clauses there within the enterprise agreement were ambiguous and susceptible of multiple interpretations. We don’t accept that’s the case here. But going on, your Honour, that in order to resolve that issue evidence was adduced.

PN1252

What his Honour determined, as your Honour would note, at paragraph 66 is that his Honour was unable to come to a conclusion as to the meaning of the clause and that’s found again at paragraph 68, that the court ultimately is dependent upon the matters that are before it and if it doesn’t allow the court to find in favour of the construction urged upon it then it’s bound to reject that application. And that’s the position here, your Honour, because in essence and in truth what this application is by the respondent union, that is the urging of its interpretation upon your Honour, is to embed into this agreement a provision that the parties to the agreement did not agree to and to change the nature of the agreement. If they seek to attack the enterprise agreement and to transform it into something that it is not then they have other remedies that they can seek to follow in respect of the matter and seek to have it done in the appropriate forum. This is not the appropriate forum for what they’re trying to do.

PN1253

The obligations, as I indicated, your Honour, that are being sought to be imposed upon the applicant are those set out at paragraph 128 of their written submissions. That interpretation is not to be viewed through the prism of the contentions of the union, who was not a participant of the negotiations concerning the enterprise agreement or has led any evidence concerning that issue. It’s to be interpreted in accordance with the ordinary meaning of the words in that clause and the ordinary meaning, of course, is the most fundamental semantic rule of interpretation. As indeed Justice Scalia of the US Supreme Court has recently commented in a text published, “Reading Law: The Interpretation of Legal Text,” interpreters of statutes, rules and instruments are not required to divine arcane nuances or to discover hidden meanings in instruments. They are to interpret the words as they appear.

PN1254

The primary contention of the applicant is that the words in clause 12.2 are clear and have no operation because of the legislative changes in respect of the Workplace Relations legislation and now the Fair Work Act. This observation of course, is consistent with the observations of the now Chief Justice of the High Court. Justice French when sitting in the Federal Court in the City of Wanneroo which is in the bundle of authorities that we’ve provided to your Honour, which is reported at [2006] FCA 813; (2006) 153 IR 426.

PN1255

Your Honour, of course, has recently dealt with the authorities on the interpretation of enterprise agreements in an exhaustive manner. We’ve included that judgment in the bundle which is TWU v Toll Dnata Airport Services [2012] FWA 5605 at paragraphs 45 to 51 and we respectfully adopt your Honour’s analysis of the law including your Honour’s reliance on French J’s decision in that case. The principles are that the provisions of an instrument which are clear and unambiguous are to be construed according to the basic conventions of the English language as they bind the parties on pain of pecuniary penalties.

PN1256

It is said against us that in respect of clause 12.2 we apprehend that somehow this commission is meant to divine an interpretation of that clause so that it conforms with the legislation and the instruments that existed at the time. But that was not the intention of the parties and it was certainly not in the minds of either parties to the agreement. What your Honour is entitled to do in terms of the extrinsic material, including this judgment, in the folder, and that is that decision of Spigelman CJ in County Securities Pty Ltd v Challenger Group Holdings (2008) NSWCA 193 – and this is paragraph 21 of his Honour’s judgment is to:

PN1257

look at extrinsic evidence to identify the subject matter of a written contract or instrument.

PN1258

The Chief Justice noted there that one can determine that in order to identify what was this instrument about. What we do know the instrument was about, your Honour, was not to include the modern award. That was very clear on the evidence of Mr Eades.

PN1259

Our friend may criticise Ms Cooper and say that she didn’t properly examine the material. She may say that Ms Cooper got it wrong but that does not then alter what was the state of mind of Ms Cooper and her instructions from her client in respect of the F17 document that was ultimately executed by Mr Phillip Eades, who gave his evidence in a straightforward manner, transparent in terms of the way that he answered the questions, which was consistent with the way that this company has approached this matter before the commission; bearing in mind it is this company that brought this matter back to the commission as a result of the dispute. His evidence was clear. At the time that they entered into this enterprise agreement they did not regard the modern award to be applicable, full stop.

PN1260

THE DEPUTY PRESIDENT: But what if that was a mistake?

PN1261

MR MOSES: Well, this is the issue, your Honour, if it’s a mistake - - -

PN1262

THE DEPUTY PRESIDENT: And there’s some authority I just can’t put my head around that at the moment but I did deal with it a couple of years ago - - -

PN1263

MR MOSES: Yes.

PN1264

THE DEPUTY PRESIDENT: - - -about a genuine mistake.

PN1265

MR MOSES: Sure.

PN1266

THE DEPUTY PRESIDENT: I think it went on appeal eventually but - - -

PN1267

MR MOSES: But your Honour, there has to be a mistake where the parties meant it to mean X but it turned out in the document to be Y. Deputy President Hamberger dealt with that situation in Pacific National Coal which was in our bundle of authorities to your Honour. It’s the last decision. That was an application under section 217, where the solicitors for Pacific National Coal, Clayton Utz, incorrectly included a provision in the agreement which did not reflect their understanding with the trade union. The trade union opposed the alteration in the opportunistic way because it was (indistinct) their membership required a windfall benefit. And Hamberger DP of course acceded to the application and amended it because it was clear that that was not the intention of the parties. But that’s section 217 which would permit that to occur.

PN1268

But that’s not the case here. They intended that the modern award would not apply to clause 12 but if they formed that view mistakenly that’s a different question from having had the intent to include it in there, but then it doesn’t appear there. That’s a mistake, your Honour. But what we’re talking about here is that there is an assertion that the company incorrectly formed the view that the modern award didn’t apply but you can’t then go back and engage in historic revisionism to say, “Well, they had that intention” because they never did. That would change the complete structure of the enterprise agreement because it’s meant to be an agreement between two parties with mutual intention. They never had that intention and neither did the other parties to the agreement.

PN1269

If the MUA in a pragmatic way, your Honour, if they wish to take the view that what occurred here was an error and that somehow the employees were inadvertently misled when the enterprise agreement was put to them, if that’s what their contention is, then they can go and put an application on and try their luck. They can say that it’s invalid and they can go to the membership that they have with this company and say, “We’re about to have declared war on this enterprise agreement and we’re going to start afresh.” They can do that. If that’s the application they want to make, go and do it elsewhere but don’t try and have this commission rewrite the agreement and impose upon the parties something that they never agreed to at the time, which is what they’re doing here and that’s the problem with their application in terms of their urging upon you the interpretation that they want and that’s our position. If they want to go and do it, they can go and do it somehow and they can justify to their membership that’s what they’re doing and then we’ll see where the cards fall when they take whatever steps they want to take in terms of the matter, and put whatever position they want to put and whatever allegation they want to make.

PN1270

One thing is clear. This company at the end of the day did not in any way, and there’s no evidence at all that would justify this, set out to deliberately mislead its membership, that is the employees, the membership of its company. In no way did it seek to in any way do anything other than being transparent. There is evidence, in any event, that the modern award, together with a bundle of other documents were provided to the employees at the time. The only person who came back from the employees to raise the modern award was the solicitor who said it didn’t apply so they both form that view. At common law, if this were a common law contract and it was argued that there was a mistake then would there be a rectification remedy available at common law? That would depend on whether they could make out their grounds but that’s not the application here. Your Honour, they’re asking you to interpret a clause. They’re saying it’s ambiguous. We say it’s not. And then they’re saying it should mean X, not Y.

PN1271

I used yesterday, your Honour – I wasn’t meaning to be flippant – but it really does remind you of the Humpty Dumpty terms that the words are what I choose them to mean. That’s what an interpretation case is about, the words - - -

PN1272

MS DOUST: It’s Alice in Wonderland.

PN1273

MR MOSES: Well, Humpty Dumpty said it in Alice in Wonderland, chapter 6 of (indistinct), he said it. All those times as a Dad you remember having to read those books. So that’s the position that they do take, your Honour, in respect of this matter, which we say your Honour would not adopt. Your Honour, what we say here is that it is also well-accepted, and can I just draw your Honour’s attention to the observations of Hayne J in Australian Communication Exchange Ltd v Deputy Commissioner of Taxation. I think your Honour it’s the second last case in the bundle we’ve provided to your Honour[2003] HCA 55; , (2003) 201 ALR 271 at page 298 at paragraph 115. Basically, your Honour, the provisions of an industrial instrument are not to be strained to achieve a result that is considered to be fair and desirable according to some standard of fairness or proper employment practice. That’s what we glean from his Honour’s decision which really, in many ways seems to be the last word from the High Court following the Amcor as to the approach to the interpretation of industrial instruments.

PN1274

Really, what the respondent union is seeking to do is to achieve a result in this case what they consider to be fair and desirable rather than the interpretation of the industrial instrument and that’s something that we respectfully submit, your Honour would not do. Your Honour’s decisions are replete with orthodox application of well-settled principles when it comes to the area of the interpretation of industrial, such as Toll v Dnata which we would respectfully submit is the appropriate way to approach this matter.

PN1275

Your Honour, can I then deal briefly with the second issue in this case which relates to clause 14(c). We have, your Honour, filed our written submissions in relation to that issue as well. Can I just ask your Honour to note in particular what we say about that at paragraph 68 through to paragraph 78 of our written submissions which were lodged on 19 April in this matter. The simple proposition, your Honour, that we seek to advance in respect of that issue is that in looking at clause 14(c) which deals with the correct rate of pay for the purposes of determining the personal leave entitlements of an employee, the guiding provisions are section 16(1) and section 99 of the Fair Work Act which sets out the rate at which employees are to be found. We say that that accords with items (a) and (b) of schedule 1 to the enterprise agreement.

PN1276

The contentions of our friends set out at paragraph 121 of their submissions do not grapple with these provisions of the Act and ought to be rejected by your Honour. Your Honour, those are the submissions that we wish to advance orally in respect of the matter in conjunction of course with the written submissions we’ve lodged. Thank you, your Honour.

PN1277

THE DEPUTY PRESIDENT: Well, I’ll mark the outline of submissions as S1 and the outline of submissions in reply S2.

EXHIBIT #S1 APPLICANT'S OUTLINE OF SUBMISSIONS
EXHIBIT #S2 APPLICANT'S OUTLINE OF SUBMISSIONS IN REPLY

PN1278

MR MOSES: May it please the commission.

PN1279

THE DEPUTY PRESIDENT: Thank you.

PN1280

MS DOUST: Thank you, your Honour. Can I start by handing up a copy of a recent decision of the full bench of this commission which deals with the principles applicable to the interpretation of instruments that are before the commission and that’s Shop, Distributive and Allied Employees Association (Queensland Branch Union of Employees) v Woolworths Ltd Trading As Woolworths. That’s a decision of Hatcher VP and Asbury DP, Commissioner Simpson, dated 17 May 2013. Your Honour, in that matter, the full bench was called upon to consider the meaning of the Woolworths Ltd Brisbane Regional Distribution Centre Collective Agreement 2011.

PN1281

The question before the commission, your Honour, was the operation of clause 7.2 of that agreement which is set out at paragraph 6 of the decision. That paragraph referred to the public holidays that were available to employees and included a clause 7.2.5 as to the maximum number of public holidays available. Your Honour can see clause 7.2.5 right down at the end of that passage, just before paragraph 7 commences. So there is an issue there about whether or not there was a restriction of public holidays to 10 public holidays only in circumstances where Queenslanders had endured the good fortune of two additional public holidays in a year, being the EKKA public holiday and the Queen’s Diamond Jubilee public holiday which was a one-off in that state.

PN1282

The relevant issue that presented itself for the consideration of the full bench is set out at paragraph 11 of the full bench’s decision, your Honour. The full bench there says:

PN1283

The SDA’s case, both before the Commissioner and on appeal, essentially called for the second sentence in clause 7.2.5 to be read in the following way: “All permanent employees will be entitled to 10 public holidays only but any additional days gazetted as public holidays under clause 7.2.1 should not be counted for this purpose.”

PN1284

The argument is characterised as requiring the commission to disregard the subheading to clause 7.2.5 which is about the maximum number of public holidays. At paragraph 12 of the full bench’s decision the full bench there sets out the principles relevant to interpretation and this is particularly relevant in the current circumstances, your Honour, because there’s clearly an issue which has been identified in the parties respective submissions about the extent to which your Honour would have regard to the subjective intention of the applicant, or even the subjective intention of the applicant and those employees who were represented by Mr Martin, which of course did not constitute the entirety of all of the employee parties to the agreement. That, we say, is a significant matter for your Honour to consider in this case if your Honour is persuaded that your Honour can have some regard to what’s described as a mutual intention in the applicant’s case. We say there is no mutuality.

PN1285

In paragraph 12 the full bench says:

PN1286

It’s undoubtedly the case that in resolving a dispute as to the interpretation of a provision of an enterprise agreement approved under the Fair Work Act 2009 it is permissible to take into account the industrial context and purpose of the agreement. However, there are two important limitations upon this approach relevant to the determination of this appeal. The first is that the process of interpretative analysis must focus first and foremost upon the language of the agreement itself.

PN1287

And it’s that principle, we say, your Honour, which is quite significant in this matter because your Honour has heard a great deal about what it is the applicant thought about the modern award or wanted in relation to the modern award but that really hasn’t been put to your Honour in terms of the precise terms of this clause. Your Honour’s task is to look at the terms of the clause and to interpret those words. The full bench there refers to the passage from Amcor which is set out below. It’s about the interpretation of a document and:

PN1288

Admissible extrinsic material may be used to aid the interpretation of a provision in an enterprise agreement with a disputed meaning but it cannot be used to disregard or rewrite the provision.

PN1289

Paragraph 13 continues and the full bench says:

PN1290

The second limitation in relation to the use of extrinsic material is this. Regard cannot be had to the respective subjective intentions and expectations of the parties as demonstrated by their statements and actions in negotiating the agreement. Rather the task is to identify the common intention of the parties as they have expressed it in the terms of their agreement.

PN1291

The full bench there quotes from the passage in Toll v Alphapharm. So we rely upon that recent decision of the full bench as the appropriate statement of the principles or the approach to be taken by your Honour in considering the agreement which is before your Honour.

PN1292

THE DEPUTY PRESIDENT: Well, that decision doesn’t alter the principles as they’ve been stated for some time.

PN1293

MS DOUST: No, no, but to the extent that in my submission the applicant’s case is put in a way which departs from those principles. We say that’s the correct statement. To the extent there’s an attempt to diverge from that, your Honour shouldn’t accept that invitation. Even putting to one side the dispute about subjective intention, your Honour, the meaning that was contended by the applicant for this clause was put at paragraph 27 of its submissions as clause 12.2 being drafted to provide a mechanism to ensure that during the term of the agreement the base weekly wage could not fall below the national minimal wage set by the Australian Fair Pay Commission.

PN1294

So it’s in fact the applicant’s contention which asks your Honour to depart from the words of the agreement. It appears now that the applicant’s case is one in which it’s said your Honour can’t ultimately be satisfied as to the meaning and so your Honour should determine that this clause is to be given no effect and given no meaning. It’s to be regarded as otiose, something to that effect. That is an approach that we would submit your Honour shouldn’t take. Your Honour should, if possible, give the words in the agreement some meaning and in particular for this reason. This was an agreement which was approved by this commission in accordance with the application of principles established under the Act and your Honour couldn’t be satisfied in the circumstances that the words of 12.2 weren’t influential in persuading the Commissioner that the agreement in fact satisfied the better-off-overall test and satisfied him as to the approval of the agreement.

PN1295

In fact, if your Honour was to think anything about a clause such as 12.1 and 12.2 your Honour would think that those sorts of clauses are precisely the sort of clause that are likely to have a powerful impact on a Commissioner considering the better-off-overall test. So a statement that appears to peg the rates under the agreement to first of all the APCS that was established, or such other rates as are established by a later body is precisely the sort of provision that would give a Commissioner some confidence that the agreement meets the better-off-overall test.

PN1296

We say the plain meaning of the clause is a reference to the Australian Pay and Classification Scales, relevant to the Wire Drawn Ferries Award, that that is what your Honour would conclude having regard properly to the context in these proceedings, and that is the wrong application of the Wire Drawn Ferries Award to the operation prior to the commencement of the modern award.

PN1297

THE DEPUTY PRESIDENT: Well, at that point in time what status did that award have?

PN1298

MS DOUST: We say that it no longer operated because the modern award took effect at that time, so it no longer operated in relation to these employees. But dealing with the contention that clause 12.2 was directed to dealing with the national minimum wage, the respondent submits that the basis upon which that argument is advanced, first of all, is entirely dependent upon it being Ms Cooper’s subjective intent. There’s no evidence at all of any mutuality in relation to the view that the clause should operate to peg the agreement to the national minimum wage. But even if your Honour was inclined to accept the idea that Ms Cooper’s subjective intent could inform your Honour as to the meaning to be given to the words in clause 12.2, in my submission, it cannot be maintained seriously by the applicant in these proceedings that that was in fact Ms Cooper’s intent.

PN1299

The suggestion that the national minimum wage played any role in Ms Cooper’s thinking, as she suggests at paragraph 45 of her statement, is belied by the reality. And that reality was this. Ms Cooper was entirely unaware of the minimum wage at the time of drafting the agreement. She was unable to say whether it was $10 or $100 less than the rates in the agreement. In fact at the time of drafting, the national minimum wage was, as I’ve indicated, $14.31 an hour or $543.78 per week, some $126 shy of the rate in the agreement. So the suggestion that there could have been any realistic cause for concern that the national minimum wage would catch up is fanciful. Your Honour will recall that Ms Cooper accepted there was nothing in her file which showed she’d undertaken any consideration of the national minimum wage.

PN1300

The second matter which contradicts that explanation of the clause is this. Ms Cooper was not the original drafter of this clause. This clause was something that came in from another agreement, and that’s clause 5.2.3 of the O’Connor Ferry Service Collective Agreement, an agreement which was made in 2009 and your Honour will recall Ms Cooper made a small amendment to that clause to remove the reference to Fair Work Australia in the clause. So the suggestion that this was a clause which had been put together with the purpose of achieving some end in relation to the minimum wage is one which doesn’t stack up in those circumstances.

PN1301

The third matter to contradict Ms Cooper’s claim in relation to the intent or meaning of the clause is this. Ms Cooper accepted in her evidence that she was aware of the term “Australian Pay and Classification Scales” and she knew that it referred to rates relevant to an award or NAPSA. She also indicated she was familiar with the notion of the term “minimum wage” and there is no coherent explanation given for why, having knowledge of those two different concepts, she would not make reference to minimum wage in clause 12.2 if it’s her intention that the clause should operate to peg the agreement to that minimum wage as in effect the safety net for it. In the respondent’s submission your Honour would not be persuaded at all that clause 12.2 was something which was directed to ensuring that the wages never dropped below the minimum wage rates as set from time to time.

PN1302

Really what the applicant’s argument boils down to in the matter is this: “don’t adopt an interpretation of clause 12.2 that would give some force to the modern award rates because it was never our intention that the modern award should apply.” The question that arises in those circumstances is this. To what extent should the commission rely upon such a desire to inform it as to the proper interpretation of clause 12.2? First of all, without doubt, the modern award did, without any question, cover the application’s operations from the time it came into effect. There can be no question of that.

PN1303

So much is made clear in the decision of the full bench in the stage three Award Modernisation and I’ve just extracted the relevant paragraph. It’s quite lengthy and I didn’t want to trouble your Honour with the entire document. Your Honour can see from below paragraph 218 on the third page of that extract, there’s reference to the Ports, Harbours and Enclosed Vessels Award 2010. Over the page there’s some discussion about the title for the award and the coverage of the award and deletion of definitions for classifications. So there’s some information here that your Honour would expect would be well-known within the industry. Significantly, paragraph 221 says this:

PN1304

We recognise the impact of the wage rates we have established for this award on employers covered by the Motor Ferries State Award and Wire Drawn Ferries (State) Award. However, a consideration of the wage rates for all current awards has led us to the conclusion that the rates we have adopted are more representative of rates in existing minimum rates prescriptions. Transitional arrangements will ameliorate the impact to some extent.

PN1305

So absolutely clear that the Wire Drawn Ferries Award had – and I’ll borrow from Mr Paul Eades – been swallowed up into the modern award. This was, as your Honour saw from exhibit B, which is the letter from Mr Eades to Ms Cooper, appreciated. Your Honour might recall looking at exhibit B, that Mr Eades at that stage had the benefit of an advice from the Industrial Relations Commission of New South Wales. That advice wasn’t produced in the course of the applicant’s evidence in these proceedings. Nor did Mr Paul Eades give any evidence about these matters and in our submission your Honour might have expected him to, given that it appeared from the evidence of Mr Phillip Eades that Mr Paul Eades had been the person who had been more engaged with these issues at the relevant time.

PN1306

There was no question really that the applicant did not want it to be the case that it was covered by the modern award. Many of us would not like to have the obligations which the law imposes upon us but that does not render that desire something that the law would recognise and give effect to. In my submission it cannot be suggested that the applicant was, in the way in which it proceeded, simply relying on the advice of its solicitor in this matter. Your Honour can see at exhibit J, which is the email of 8 May 2010 from Mr Eades to Ms Cooper that Mr Eades says:

PN1307

When do we have to disregard the state award and work under the modern award? And if so, is it possible to make application to vary the modern award and bring it closer in form to the Wire Drawn Ferries Award?

PN1308

It says further in that email:

PN1309

I would like to proceed with our enterprise agreement as a matter of urgency because if we don’t we will run out of time and be caught in no-man’s land.

PN1310

So your Honour might recall, I can’t recall whether it’s Ms Cooper or Mr Eades or both of them were asked whether at this stage there was any urgency which led to the issuing of the agreement and the attached documentation to employees and that suggestion was denied by both parties. But Mr Eades’ email certainly gives that impression. Mr Eades’ email also gives the impression of someone who is a fairly canny operator. Ms Cooper claimed at one stage in her evidence that upon reading the email of Ms Wilson which had been attached to Mr Eades’ email, that she formed the conclusive view that the modern award did not apply. In my submission the commission would not accept that evidence because it is belied by every piece of documentary evidence available at the time.

PN1311

First there is the email from Ms Wilson itself, dated 7 May, which speaks in terms of the application of the Ports, Harbour and Enclosed Water Vessels modern award to these operations and its relevance for any new agreements that are to be made. It does, of course, indicate a qualification at the end of the email but that is not a qualification which in my submission either Mr Eades or Ms Cooper would have read as meaning, “Oh, it’s quite clear now. The modern award doesn’t apply.” What’s suggested there is perhaps there’s some possibility that there is another award with occupational coverage and “we’ll get back to you.” No evidence of any attempt to follow that up. So the terms of Ms Wilson’s email don’t lead to the conclusion that the award has no application in any sort of conclusive sense.

PN1312

The terms of Mr Eades’ email don’t suggest that he’s taken from Ms Wilson’s email that it’s beyond doubt the award has no application. The terms of Ms Cooper’s letter, dated 11 May 2010, which is exhibit 1, which says at the outset:

PN1313

The awards that apply are the Wire Drawn Ferries NAPSA and the modern award being the Ports, Harbours and Enclosed Water Vessels Award 2010 -

PN1314

and it goes over to advise that a copy of the modern award would need to be provided to employees in the course of getting the agreement approved. Other references are made to the modern award throughout. There’s a comparison undertaken in the letter. In my submission, your Honour wouldn’t think that based on Ms Wilson’s email Ms Cooper had on receiving it on about 10 May formed some conclusive view about the modern award having no application in the circumstances.

PN1315

Ms Cooper later gave advice to the applicant about the issue of award coverage and that was her email dated 13 May 2010 which is exhibit O. That advice was really based on the conclusion that there was no category for wire drawn engine drivers under the modern award. Your Honour might recall that Ms Cooper made the admission in cross-examination in relation to the basis of this advice that she was reliant upon the information that she was being given by Mr Eades to form the view that she had formed. But in any event, the advice is couched, at its end with the qualifier:

PN1316

This is an evolving area of the law -

PN1317

this is in the final paragraph of exhibit O -

PN1318

This is an evolving area of the law and it may be that if the matter were litigated that a different view would emerge from the bench.

PN1319

So in the respondent’s submission the applicant always appreciated that there was at least, at the very least, appreciated that there was a real prospect that the modern award applied to it. What appears to be said against that is that the evidence of the applicant’s intent that the modern award was not to apply was the fact that it entered into an agreement which would have the effect of ousting its operation. To the extent that that was the applicant’s intention it was almost entirely invisible at the time, save for, and your Honour will recall the reference in clause 13 of the agreement, in respect of allowances. The reference in clause 13 where:

PN1320

And these allowances incorporate all penalty rates allowances and loadings referred to in the modern award or the state award and the NES insofar as these are relevant.

PN1321

You might think it’s curious in circumstances where it’s claimed that there was a concluded view formed that the modern award didn’t apply, that there is a clause which is designed to oust the operation of the allowances under that award. At best, it’s the applicant having had two bob each way. But if it was the applicant’s intention by this agreement to oust the operation of the modern award one would have expected to have seen the modern award identified as the reference award in the documentation which was provided to the commission.

PN1322

The modern award had certainly been provided to employees and your Honour saw that there were references to the modern award, both as the reference award and in relation to informing the commission about steps which had been taken to notify the employees in some versions – it might be duplicates of a single version – of the form 17 which had initially been prepared in the name of Mr Paul Eades, the senior Mr Eades.

PN1323

So in some versions of that document reference was made to the modern award. The final version that was provided to the commission excluded those references. And the exclusion, this came about in circumstances, which the respondent submits are not explained in the evidence. Ms Cooper, I think, gave no explanation for how the references to the modern award came to not appear in the form 17 document which was ultimately submitted. Although I think the tenor of her evidence was that she and Mr Phillip Eades had drafted the document together. Mr Eades at one stage said that he relied upon Ms Cooper for the drafting of those aspects of the document.

PN1324

Having taken what must have been the conscious decision to make no reference to the modern award in those documents in support of its application for approval of the agreement it lies ill in the mouth of the applicant, the respondent submits, to call in aid an intention to oust the operation of the modern award in aid of an interpretation of clause 12.2 which is in the respondent’s submission contrary to an ordinary interpretation that would be given to the words that are contained in clause 12.2 of the agreement.

PN1325

In particular, what is of significance in clause 12.2 is the reference at its conclusion to “other designated government bodies.” That’s a form of words that your Honour would be well familiar with over the years and what it anticipates is that whichever government body is named in a particular provision will at some stage be renamed or replaced by a different body or the duties will be handed over to a different body. That is precisely what has occurred in relation to the Australian Pay and Classification Scales which were contained in the Wire Drawn Ferries Award and which continued to exist throughout that period from 2006 to the end of 2009. It’s precisely what has happened. After that time what has occurred is the modern award has come into effect from 1 January 2010 and by virtue of the transitional provisions, the transitional rates take an effect by 1 July 2010. We say, far is it from what’s contended by the applicant. It’s good that I can remember the names of the parties - - -

PN1326

MR MOSES: There’s no sledging or (indistinct) to my learned friend.

PN1327

MS DOUST: It’s like having Mark Waugh sitting at the table next to me, your Honour.

PN1328

MR MOSES: That’s not true.

PN1329

MS DOUST: It’s so far from the case that the respondent is asking your Honour to strain what would be the ordinary interpretation of these words. What is contended for by the respondent in this matter is a simple reading of clause 12.2 to consider what were the Australian Pay and Classification Scales relevant to these employees as those associated with the Wire Drawn Ferries NAPSA? What’s the other designated government body now in charge of that? Well, as your Honour can see from the Award Modernisation decision Wire Drawn Ferries NAPSA became part of the modern award and the rates are those which are provided for under that award, which by virtue of the transitional provisions means that there’s a gradual increase up to the full rates over quite a substantial period.

PN1330

THE DEPUTY PRESIDENT: Well, if it is as simple as you suggest - - -

PN1331

MS DOUST: Yes.

PN1332

THE DEPUTY PRESIDENT: - - -merely that I just look at the words - - -

PN1333

MS DOUST: Yes.

PN1334

THE DEPUTY PRESIDENT: - - -and draw the conclusion that you have drawn why is it necessary to go to all this extrinsic material?

PN1335

MS DOUST: Well, to meet the case which is being advanced by the applicant.

PN1336

THE DEPUTY PRESIDENT: I see.

PN1337

MS DOUST: It’s really a case in response because we say it’s a matter of the plain words of clause 12.2. What’s put against us is competing contentions, either a) this is about the federal minimum wage because Ms Cooper says it is, or you can’t be sure so don’t give this clause any effect, or “no, we never wanted the modern award to apply so we would never have signed up to something that meant that it could apply.” Now, my principal submission is that one just has to read the words, but secondary to that I’d say one wouldn’t be swayed in this by the suggestion that’s made by the applicant, “No, we never had this intention and therefore this should never be interpreted in that way.” So it’s really in response to that case.

PN1338

THE DEPUTY PRESIDENT: Well, your submissions say that the relief that’s sought by the applicant and I presume it goes back to the application itself or the notification itself - - -

PN1339

MS DOUST: Yes.

PN1340

THE DEPUTY PRESIDENT: - - -is not available.

PN1341

MS DOUST: Yes.

PN1342

THE DEPUTY PRESIDENT: But I had understood that there had been some sort of consent about the question that was to be asked that the commission would answer.

PN1343

MS DOUST: I think that the position is this, your Honour. If your Honour has the application?

PN1344

THE DEPUTY PRESIDENT: Yes.

PN1345

MS DOUST: Going to the third page in, it was initially the – I’m sorry, going to paragraph 7 the relief sought - - -

PN1346

THE DEPUTY PRESIDENT: Yes.

PN1347

MS DOUST: - - -it was initially the applicant’s case that the applicant sought the approval of a change to be implemented to the agreement in the terms set out at paragraph 1 there and also sought relief in the terms of paragraph 2. That’s now been abandoned in the reply submissions so it really does become now, your Honour, a question of interpretation pure and simple of clause 12.2 and paragraph 14.

PN1348

MR MOSES: If I can interrupt my learned friend, both parties, your Honour, agree, to answer your Honour’s question, that your Honour is properly seised of the matter pursuant to section 739 to resolve the dispute in terms of what is the interpretation of the clause and our friends have urged a particular - - -

PN1349

THE DEPUTY PRESIDENT: Of both clauses?

PN1350

MR MOSES: I’m sorry, yes. And our friends have urged an interpretation of clause 12.2 which we have disputed, if it please, your Honour. And there’s no dispute that your Honour has jurisdiction to deal with the dispute in those terms.

PN1351

THE DEPUTY PRESIDENT: Thank you.

PN1352

MS DOUST: So unless your Honour has any further questions about clause 12.2 issue, I was proposing to turn to deal with the question of clause 14. Can I add, your Honour, my submissions are in addition, obviously, to the lengthy written submissions that have already been filed and served on behalf of the applicant but I didn’t think it would be a good use of your Honour’s time today for me to read through them all and go through them in any further detail. They’re obviously quite comprehensive, particularly about the operation of the transitional provisions. Can I highlight this to your Honour? The applicant’s reply submissions concede the correctness of paragraphs 40 to 53 of the respondent’s submissions which were filed by the respondent in these proceedings. That is accepted by the applicant. Thank you, your Honour.

PN1353

Dealing now with the question of personal leave, if I can just briefly take your Honour to the relevant provisions? Personal leave is at clause 14 of the agreement and the relevant provision is 14(c), which provides:

PN1354

Personal leave is defined in accordance with the terms of the National Employment Standards.

PN1355

Can I take your Honour next to section 99 of the Fair Work Act, which provides:

PN1356

If in accordance with this subdivision an employee takes a period of paid personal/carer’s leave the employer must pay the employee at the employee’s base rate of pay for the employee’s ordinary hours of work in the period.

PN1357

Section 99 sets out the basis upon which payment is made when the accrued leave is taken. Can I emphasise to your Honour there the reference to “the employees’ ordinary hours of work in the period.” It’s a reference to that employee’s ordinary hours of work, not some external notion of the ordinary hours under the award or anything like that. It’s that employee’s ordinary hours.

PN1358

Section 16 of the Act defines the term “base rate of pay.” That provision, your Honour, includes a similar emphasis. In the preamble the section states:

PN1359

The base rate of pay of a national system employee is the rate of pay payable to the employee for his or her ordinary hours of work but not including any of the following -

PN1360

and so on. And it’s those exceptions which come into play in this matter, that the emphasis being there’s a focus on the ordinary hours of work of that employee. Going to clause 11 of the agreement, your Honour – and can I just interpose there by drawing your Honour’s attention to the helpful reference in the submissions, in the respondent’s submissions, and I can talk them up because I didn’t produce them myself, but there’s a helpful reference there to the explanatory memorandum as to how these provisions are to be interpreted. In particular there’s some material in the explanatory memorandum that suggests that an employee is to receive payment as if at work. Your Honour can find that part of the submissions and it’s set out in full, the extract from the explanatory memorandum.

PN1361

The respondent’s submission in this matter is simply this. When one looks at the rate which is relevant, one looks at the weekly rate of pay applicable to seven-day rotational shift workers, and that’s a rate of pay which is described at clause 11.2(h) of the agreement, one can see there that there is nothing paid to an employee as an allowance or loading. What occurs at 11.2(h) is that a total has been reached by adding up the weekly rate of pay, that’s A plus J plus O. So that’s payment for the week. Your Honour will see these amounts are set out in schedule 1 at the back of the agreement. Your Honour can see A is the base weekly wage, J is the daily rate, eight hours for Saturday hours, O is the daily rate, eight hours for Sunday hours. So those amounts are added up.

PN1362

Flexibility allowance, being F plus L plus Q, that’s a flexibility allowance at the weekly rate plus the Saturday daily rate and the Sunday daily rate. Then crib allowances, the weekly rate, that’s D; the daily rate for Saturday, K; and the daily rate for Sunday included in the initial calculation. Then what happens is that amount is divided by seven and multiplied by five. Really what’s occurred here is there’s a process whereby an aggregate pay has been determined and it’s transparent as to the matters that have been taken into account in making that calculation but nothing is paid as a loading, a monetary allowance, an overtime or penalty rate.

PN1363

It is certainly not the case that it’s appropriate in these circumstances, your Honour, for an employee who is working a seven-day rotational shift to have the base rate, $670, payable in respect of an employee on ordinary hours rotational shift, that that is the payment in respect of their ordinary hours. That’s certainly not the case. So that’s the way in which the argument proceeds, that what one has in respect of the seven-day rotational shift employees is an overall rate which has been arrived at by carrying out an initial addition and then applying a further discounting effect to render it a lesser amount than the entire aggregate amount.

PN1364

THE DEPUTY PRESIDENT: So it doesn’t include overtime or penalty rates?

PN1365

MS DOUST: No.

PN1366

THE DEPUTY PRESIDENT: No.

PN1367

MS DOUST: In my submission it doesn’t. It is just simply the rate applicable for those employees.

PN1368

THE DEPUTY PRESIDENT: Doesn’t the confusion seemingly arise because there’s a conflation of two concepts, a base rate of pay under the Act and the ordinary hours of work and then if you look at 2(h) it talks about a weekly rate of pay but then you go back to 1(d) and it talks about a base weekly wage.

PN1369

MS DOUST: Yes.

PN1370

THE DEPUTY PRESIDENT: So it’s interchanging terms that are quite separate.

PN1371

MS DOUST: Yes.

PN1372

THE DEPUTY PRESIDENT: This is where the argument arises, doesn’t it? But you say it’s clear on its face?

PN1373

MS DOUST: We say one looks at it, one considers what is the base rate of pay for these employees and that’s the rate of pay in respect of that employee’s ordinary hours of work. Now, the base weekly wage which is set at A is a rate which really is associated with a person on ordinary hours’ rotational shift. So that’s a different category of employee altogether to the seven-day rotational shift worker. And ordinary hours, of course, to some extent they’re defined in this agreement because there’s a reference, your Honour will see in clause 10. There’s “ordinary hours constituting work between midnight on Sunday and midnight on Friday.” But that doesn’t mean - - -

PN1374

THE DEPUTY PRESIDENT: So what the employer says here is that the NES, to go back to the Act - - -

PN1375

MS DOUST: Yes.

PN1376

THE DEPUTY PRESIDENT: - - -is exclusive of flexibility allowance and crib allowance?

PN1377

MS DOUST: Yes, and payments in respect of Saturday and Sunday.

PN1378

THE DEPUTY PRESIDENT: Weekend, Saturday and Sunday.

PN1379

MS DOUST: Yes. That’s in the agreement a simply a daily rate.

PN1380

THE DEPUTY PRESIDENT: Well, have there been any authorities on this question because presumably there are plenty of industries and employees who work rotating seven-day shifts?

PN1381

MS DOUST: I must say, your Honour, I haven’t – I’m sure there are, but I’m not able to point your Honour to any. I simply rely upon the, I think, what’s a reasonably well-accepted principle, the idea that once someone is paid something like an annualised salary or an aggregate wage that it is no longer paid as penalties or the like and that’s in my submission a fairly well-accepted principle. Unless there’s anything further, your Honour?

PN1382

THE DEPUTY PRESIDENT: The corollary of your submissions on both questions - - -

PN1383

MS DOUST: Yes.

PN1384

THE DEPUTY PRESIDENT: - - -no doubt is that there would be significant underpayment claims. Isn’t that the case?

PN1385

MS DOUST: It may be and obviously it may well be the case – clearly the personal leave matter is likely to be substantially less than the clause 12.2 matter.

PN1386

THE DEPUTY PRESIDENT: Yes, but nevertheless how does the union propose to address that in the event that you’re successful?

PN1387

MS DOUST: Well, I don’t have specific instructions at this stage. I think it would be a matter of awaiting your Honour’s decision and then proceeding with such course as is appropriate then. I think it would be the hope of many parties that come before the commission in these sorts of proceedings that and consistently with the terms of the dispute resolution clause which oblige the parties to accept decisions of the commission, that it would be the hope that the employer would then abide by the decision.

PN1388

THE DEPUTY PRESIDENT: Well, yes, but in these circumstances, there is a contract and a tender that was awarded on one basis - - -

PN1389

MS DOUST: Yes.

PN1390

THE DEPUTY PRESIDENT: - - -which on your submission should have been awarded on another basis - - -

PN1391

MS DOUST: Yes.

PN1392

THE DEPUTY PRESIDENT: - - -and that calls into question that tender, doesn’t it?

PN1393

MS DOUST: It doesn’t call into question the tender and there are a number of reasons why I’d say your Honour wouldn’t be persuaded by that consideration in your Honour’s approach to this matter. First of all, your Honour is simply interpreting the terms of the agreement and that’s your Honour’s task. But dealing with the question of the contract that was entered into, what your Honour does know is that this was a party that was certainly on notice, on very substantial notice, throughout this period that there was a prospect that the modern award would have some application to it.

PN1394

Your Honour will see I think it’s clear from Ms Cooper’s statement and her evidence that the contract has been taken up with the RTA or the RMS. Your Honour can see throughout the materials that the RTA or RMS were aware of this issue throughout. There’s some discussion, I think, in the email from Mr Eades, dated 8 May. At exhibit J your Honour can see there’s a reference by Mr Eades:

PN1395

The RTA seems willing to support an application to vary the modern award in conjunction with us but is this necessary at this stage?

PN1396

Your Honour will recall the evidence about the email from Ms Wilson. That was sent to a number of persons who were at the RTA who were involved in contracts management. So both the RTA and the applicant were alive to these issues throughout, your Honour.

PN1397

THE DEPUTY PRESIDENT: Well, does that mean that – and perhaps I’m going beyond what’s entirely necessary – but does that mean that there’s a variation term within the contract for any decisions which might affect the monetary value of the contract?

PN1398

MS DOUST: We don’t know that, your Honour.

PN1399

THE DEPUTY PRESIDENT: No.

PN1400

MS DOUST: But what we do know is certainly the applicant went into any contract that it entered into with its eyes open about the issue of the modern award and the party that it contracted with was very alive to those issues and was in fact, appeared to be agitating that a particular approach be taken to the modern award and it’s - - -

PN1401

THE DEPUTY PRESIDENT: It might be interesting to see on what basis the unsuccessful tenderers put their tender in.

PN1402

MS DOUST: It would be, it would be. But in our submission your Honour doesn’t have to feel obliged to - - -

PN1403

THE DEPUTY PRESIDENT: No, no.

PN1404

MS DOUST: - - -protect the applicant from the consequences of the calculated decisions it’s made throughout.

PN1405

THE DEPUTY PRESIDENT: No, but I always like to consider what the consequences of - - -

PN1406

MS DOUST: Of course.

PN1407

THE DEPUTY PRESIDENT: - - -my decisions are.

PN1408

MS DOUST: Of course.

PN1409

THE DEPUTY PRESIDENT: I guess to put it crudely if this employer lost a contract or something of that nature happened, it wouldn’t matter because these ferries still have to run.

PN1410

MS DOUST: Yes.

PN1411

THE DEPUTY PRESIDENT: And someone has to run them.

PN1412

MS DOUST: Dare say it might be the people who currently are.

PN1413

THE DEPUTY PRESIDENT: It’s not as if they’re a Ford.

PN1414

MS DOUST: Not expecting the withdrawal of all wire drawn ferries from Australia in a hurry, your Honour.

PN1415

THE DEPUTY PRESIDENT: The good people of Port Macquarie would probably not be happy about that.

PN1416

MS DOUST: Not at all.

PN1417

THE DEPUTY PRESIDENT: All right, thank you.

PN1418

MS DOUST: Thank you, your Honour.

PN1419

MR MOSES: Your Honour, just briefly in reply, with all due respect to my learned friend, the fallacy in her argument was exposed in the questioning by your Honour in terms of the interpretation of clause 12.2 as sought to be imposed upon the parties to the enterprise agreement. My learned friend, of course, answered in response to your Honour’s question that if it was all relatively straightforward, why was there the need for there to be a review of the extrinsic material because that’s what our friend has to do in order to rewrite clause 12.2 in a manner that of course is impermissible.

PN1420

My friend took your Honour at the outset to the decision of the full bench of 17 May 2013 in SDA v Woolworths Ltd and took your Honour to paragraph 12 as if to somehow suggest in her submissions that what we, that is the applicant, were seeking to impose upon the commission was something at odds with paragraphs 12 and 13. There are three points to be made. Paragraphs 12 and 13 are just a rehash and application of principles that have been set forth in decisions of members of this commission time and time again, including your Honour’s decision in Toll. It doesn’t say anything different.

PN1421

Number two, paragraph 12 is exactly what our friend is asking your Honour to do which has been held by the High Court to be impermissible, that is, to attempt to use extrinsic material to disregard or rewrite a provision in order to give effect to some externally-derived conception. That’s what my friend is asking your Honour to do. There are no two ways of looking at her submissions other than that. The third proposition in respect of this case, your Honour, is where one gets to paragraph 13 we say it permissibly allows the court to look at what was the subject matter of the parties in terms of their common intention and that’s what your Honour needs to do in respect of this matter.

PN1422

My learned friend then moved on to say, let’s go to paragraph 45 of Ms Cooper’s statement and her submissions were a bit difficult to follow, with no disrespect to my learned friend, because it’s not clear whether she was saying, “You shouldn’t believe Ms Cooper when she says she had an understanding” or “Her understanding was wrong.” But either way, it’s irrelevant. The question is what was the intention of the parties at the time? The intention was that the modern award was not applicable to clause 12.2. Whether she wants to say that Ms Cooper was wrong, that’s irrelevant. If she wants to say that a solicitor of the Supreme Court in giving her evidence was not truthful in paragraph 45, well, that wasn’t put to the witness directly.

PN1423

She went on then to attack in a collateral way the evidence of Mr Eades but Mr Eades was quite firm in his evidence and very blunt in his evidence in terms of his understanding about whether the award applied at the time of the F17 declaration being made. It’s not uncommon for parties to express views in their internal musings about whether or not something complies or not, but at the end of the day when they come to put a position to a court or a commission they nail their colours to a particular mast and they run with it and that’s what they did in respect of having a formal view as to whether or not the modern award applied or not.

PN1424

That was their intention and the intention of at least the representative of some of the employees. No evidence has been led to the contrary by the respondent union which is rather curious. But if my learned friend says, “Well, that was the representative of some of the employees,” well, where are the other employees that would somehow assist our learned friend in terms of her argument? There was nothing put in respect to that issue.

PN1425

In respect of clause 14(c) your Honour is correct in terms of schedule 1 and clause 14(c) there perhaps having been what appears to be a conflating of issues in terms of the concept of ordinary hours. But it’s quite apparent, your Honour, we say on our reading of schedule 1 that the ordinary hours relates to those matters that are set out at 1(a) and that’s the position. Now, our friends wish to read something further in respect of the interpretation of the schedule which we say is not available, both on the face of the enterprise agreement as well as the terms of the statute.

PN1426

The other matter that I wanted to address your Honour briefly is this. If your Honour could got to exhibit L, your Honour asked my learned friend a direct question concerning whether at the time the enterprise agreement was approved by the Commissioner the Wire Drawn Ferries (State) Award had no applicability. If your Honour goes to the last page of exhibit L your Honour will see the note there that the award was terminated on 27 July after the enterprise agreement was made by the Commissioner in accordance with item 3 of schedule 5 of the Fair Work Transitional Provisions and Consequential Amendments Act. So her statement is not correct. It still was operative at the time.

PN1427

The other matter that I wanted to just briefly address your Honour related to and this really relates to the clause 12.2 point. I omitted to draw to your Honour’s attention on that point page 36 which is relevant to the position of the company and statements that were being made to the employees at the time. Page 36 of Mr Eades’ statement makes it clear at the time that the letters were going out that there appeared to be no applicable modern award to date and he expressly drew their attention to the Ports, Harbour and Enclosed Water Vessels Award. It wasn’t being hidden. He said it doesn’t deal with wire drawn ferries. So insofar as it can be suggested that this case involved some bad faith dealings or whatever by the company, that’s not the case at all.

PN1428

As for the discretionary issues, I think that your Honour raised, concerning possible impact of this determination on the company, your Honour, the simple fact is there was an agreement that was entered into with the RTA which they approved which referenced the enterprise agreement rates. There is no mechanism within that contract that would permit there to be a variation to take into account any new labour rates that will be imposed upon the company for the life of that contract. It’s something that the company would have to wear at the end of the day.

PN1429

I know that there’s been some implied comments made about the Commissioner in this case and his approval of the enterprise agreement but the fact is, your Honour, it was approved by the Commissioner and the applicant has acted in good faith moving forward. When this issue was drawn to its attention in October 2012 it sought to bring it to a head by bringing it to this commission to have the dispute resolved because it does not agree with the respondent union’s interpretation and with respect, what the respondent union is seeking to do here is to rewrite the terms of the agreement which is impermissible.

PN1430

If they want to attack the enterprise agreement in some other way then they should do it in accordance with the terms of the Act, rather than seeking to have your Honour do something which is contrary to the application of the principles of industrial interpretation as your Honour has made clear in a series of decisions. Those are our submissions, your Honour.

PN1431

THE DEPUTY PRESIDENT: Thank you. I thank both counsel for their helpful submission - - -

PN1432

MS DOUST: I’m sorry to interrupt, your Honour, I just wanted to clarify one matter because I think my friend was perhaps not directly suggesting but it might have been implied in what he’d said that I’d misled your Honour. I’d understood your Honour’s question to me about the Wire Drawn Ferries Award related to its status in relation to these employees at the time and that’s a matter which is addressed. I’ll just give your Honour the references in the submissions. It’s at paragraph 69 and 70 of the written submissions which deal with the transitional provisions and how NAPSA ceases to cover an employee when the modern award starts to cover an employee. So the references to the schedules are contained in there. If your Honour was asking something else - - -

PN1433

THE DEPUTY PRESIDENT: I was asking what its legal effect was at the time.

PN1434

MS DOUST: Well, the legal effect is in my submission, your Honour, it didn’t cover the employees from the time the modern award came into effect on 1 January 2010 and that’s clear from both the terms of the modern award, the decision I referred your Honour to and those transitional provisions which are helpfully extracted in those submissions.

PN1435

THE DEPUTY PRESIDENT: Yes, thank you.

PN1436

MS DOUST: Thank you, your Honour.

PN1437

THE DEPUTY PRESIDENT: Again, I thank you again for your helpful submissions, the efficient and orderly conduct of the proceedings and I intend to reserve my decision in the matter. I now adjourn.

<ADJOURNED INDEFINITELY [11.32AM]

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #Q WITNESS STATEMENT OF PAUL GARRETT PN1238
EXHIBIT #R EXTRACT FROM THE AUSTRALIAN FAIR PAY COMMISSION DECISION OF JULY 2009 PN1244
EXHIBIT #S1 APPLICANT'S OUTLINE OF SUBMISSIONS PN1278
EXHIBIT #S2 APPLICANT'S OUTLINE OF SUBMISSIONS IN REPLY PN1278