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Fair Work Commission Transcripts |
TRANSCRIPT OF PROCEEDINGS
Fair Work Act 2009 1052495
COMMISSIONER JOHNS
C2015/3008 C2015/3009 C2015/3010
s.526 - Application to deal with a dispute involving stand down
Mr Timothy Schell
and
Ensign Australia Pty Ltd
(C2015/3008)
Ensign Australia Pty Ltd Onshore Drilling Employees Enterprise Agreement 2014
(ODN AG2014/7033)
[AE409791 Print PR554711]]
s.526 - Application to deal with a dispute involving stand down
Mr Chris Cootes
and
Ensign Australia Pty Ltd
(C2015/3009)
Ensign Australia Pty Ltd Onshore Drilling Employees Enterprise Agreement 2014
(ODN AG2014/7033)
[AE409791 Print PR554711]]
s.526 - Application to deal with a dispute involving stand down
Mr Scott Colwell
and
Ensign Australia Pty Ltd
(C2015/3010)
Ensign Australia Pty Ltd Onshore Drilling Employees Enterprise Agreement 2014
(ODN AG2014/7033)
[AE409791 Print PR554711]]
s.526 - Application to deal with a dispute involving stand down
Mr Nathan John Wollman
and
Ensign Australia Pty Ltd
(C2015/3443)
Sydney
2.20 PM, MONDAY, 7 SEPTEMBER 2015
PN1
THE COMMISSIONER: Appearances please.
PN2
MR I LATHAM: If the Commission please, my name is Latham, initial I. I appear on behalf of the applicants in this matter.
PN3
THE COMMISSIONER: Yes, thank you, Mr Latham.
PN4
MR A JOSEPH: If the Commission pleases, Joseph, initial A, Commissioner. I appear on behalf of Ensign.
PN5
THE COMMISSIONER: Yes, thank you, Mr Joseph. Gentlemen, I've had the opportunity to read the submissions which have been filed in the matter and I'm satisfied that having regard to those the matter is invested with sufficient complexity such that I will be assisted in the efficient conduct of the matter if I allow both parties to be represented by counsel, and I so do under section 596(2)(a) of the Fair Work Act.
PN6
MR LATHAM: Commissioner, there are some other just preliminary matters.
PN7
THE COMMISSIONER: Yes.
PN8
MR LATHAM: There is a matter of - I will probably pronounce this wrongly but Jakubowski which your Honour may have. We would seek that that be joined to these other matters, given that they're all dealing with the same factual stratum. The second issue is neither counsel were involved, there was an earlier conciliation as we understand it at least on behalf of the applicant but there might be some use in assuming that although I've discussed that with my friend and they're not very wedded to that view, but it might need to be considered. The third issue is I was going to seek pursuant to 586 of the Act an amendment to the orders sought, simply that the current orders be deleted and that they now read:
PN9
The respondent pay the applicant an amount that is fair in the circumstances.
PN10
Subject to that, we're ready to proceed, Commissioner.
PN11
MR JOSEPH: Commissioner, can I deal with those - - -
PN12
THE COMMISSIONER: It's interesting, isn't it?
PN13
MR JOSEPH: It's a very interesting - the last comment by my learned friend is very interesting and I should say that's the first time I've heard it, although we've all been in the environment, in the precincts for some time now. Commissioner, I'll deal with the matters in turn.
PN14
Firstly, in relation to the Jakubowski matter. We think they should all travel together.
PN15
THE COMMISSIONER: Yes.
PN16
MR JOSEPH: Certainly for present purposes it makes sense - - -
PN17
THE COMMISSIONER: I understand that that is C2015/3443.
PN18
MR JOSEPH: Yes.
PN19
THE COMMISSIONER: And I will join that with the other matters. Am I right about that?
PN20
MR JOSEPH: I'm sorry.
PN21
MR LATHAM: No, I think that might be the wrong number. 5246 is what I'm told.
PN22
MR JOSEPH: Wollman is 3443 and that's already been joined, I'm told.
PN23
THE COMMISSIONER: Yes. So what's the new one called?
PN24
MR JOSEPH: The new one is called Jakubowski, my learned friend's got the - his name is Tye Jakubowski, I'll spell that for the record, Commissioner. J-a-k-u-b-o-w-s-k-i.
PN25
THE COMMISSIONER: It's C2015.
PN26
MR JOSEPH: Yes.
PN27
THE COMMISSIONER: Yes, what number after that?
PN28
MR LATHAM: 5246, I'm told. 5246.
PN29
THE COMMISSIONER: 5426.
PN30
MR LATHAM: 5246.
PN31
THE COMMISSIONER: Yes, we'll join the C2015/5246 in the matter of Mr Jakubowski to the other four matters. Just bear with us a moment. I'm informed by my Associate the matter has already been allocated to a different member, we just need to see whether - - -
PN32
MR JOSEPH: I see.
PN33
THE COMMISSIONER: The matter has been allocated to another member. What I propose to do is inform the acting panel head that it's a matter that could be more efficiently dealt with if it was re-allocated to me. I don't imagine that there will be any difficulty with that course of action. I'll order that they all be dealt with together.
PN34
MR JOSEPH: Commissioner, I think I should now deal with what I understand to be an application now being made to fundamentally amend the applications.
PN35
THE COMMISSIONER: No, I think I'd like you to deal with the second thing that Mr Latham raised.
PN36
MR JOSEPH: I'm sorry.
PN37
THE COMMISSIONER: Which is whether or not there was any preparedness to have some discussions because we may or may not want to, it's a matter for you and your client, but if I've got jurisdiction to deal with the matter then we could deal with it here. If I don't have jurisdiction to deal with the matter your clients likely to be dealing with it elsewhere anyway so is there any opportunity to have some discussions? Do you need a moment to get some instructions?
PN38
MR JOSEPH: If you just bear with me for one moment.
PN39
THE COMMISSIONER: Yes. Yes, sorry Mr Joseph?
PN40
MR JOSEPH: Yes, Commissioner, the position my client takes is that arising out of the previous conference on 2 July there was some - - -
PN41
MR LATHAM: If there's going to be a discussion about what was said in the conference - - -
PN42
MR JOSEPH: No, no.
PN43
THE COMMISSIONER: No, I think he might be - - -
PN44
MR JOSEPH: Not at all.
PN45
THE COMMISSIONER: I think Mr Joseph's skilled enough not to tell me what was said. He might just be reporting the fact of things occurring as opposed to what was - - -
PN46
MR LATHAM: Sure.
PN47
THE COMMISSIONER: I trust him to be - - -
PN48
MR JOSEPH: Yes, thank you, Commissioner. Commissioner, as I explained to my learned friend before the Commission came on the Bench, my client has two problems with conciliation today and this is before we deal with the third point. The first one is that there were communications between the parties after the last conciliation conference where there was a specific request from the applicants' solicitors for certain information about pay rates and so forth, that might inform what might be put in terms of dollar figures and so forth. That was responded to - that request came I think on 21 July from Mr Maffrey to Ms Rumble. That was responded to on 24 July with the relevant information in relation to each employee, and a request that something be put effectively if that process was going to go any further.
PN49
I am instructed that nothing further, nothing was sent at all. Obviously this jurisdictional point has been raised and whilst the - how can I put it, whilst the applications are on foot in their current form, we say pretty firmly that the Commission does not have jurisdiction for the reasons we've outlined so we'd not be minded to conciliate.
PN50
THE COMMISSIONER: Yes, but if you're right about that then your client will just face this is another place.
PN51
MR LATHAM: With penalties.
PN52
MR JOSEPH: Well my learned friend's suggesting a particular result - - -
PN53
THE COMMISSIONER: Well it might be that the parties prefer to fight it in another place on another day and drag all this out or seeing whether you want to try and fix it all now.
PN54
MR JOSEPH: Well, Commissioner, just bear with me for one moment. Commissioner, I think certainly from my client's point of view it does not want to not continue acting in good faith, however it's fair to point out that any potential resolution in relation to these applications may have broader implications. That's a matter of some concern of my client that would take - it would take some reflection. I think in those circumstances there is a reluctance to go down that path whilst there is on foot applications that we say must fail for want of jurisdiction.
PN55
THE COMMISSIONER: Yes, I understand.
PN56
MR JOSEPH: I think I'm trying to put that in the most proper way, Commissioner.
PN57
THE COMMISSIONER: No, no, I understand. Yes, I understand. It doesn't look like we can take that further then. The third item was the application pursuant to section 586 that I allow correction or amendment to the application in section 4 which is the orders sought or prayer for relief.
PN58
MR JOSEPH: I think with respect, Commissioner, my view is that we've been completely blind-sided by this. This is something that should have been - that the need - well, we deal with it this way. What is being done is so fundamental it is an entirely new application. This isn't an amendment in its normal terms as one would see an amendment, this is an entirely new application and it's an application that if it were to be acceded to will have caused, at the very least, will have caused my client considerable cost in agitating these matters to this point on the question of jurisdiction. That would be a matter we'd wish to be heard on in due course in any event I would imagine.
PN59
The applications would be so fundamentally different as to, in my submission, would require fresh applications to be made. I mean the applicants really ought to go back to square one.
PN60
THE COMMISSIONER: Well - - -
PN61
MR JOSEPH: I should add there's also - there's still the issue of them being ex-employees.
PN62
THE COMMISSIONER: Yes, but there are two limbs to the jurisdictional objection; one I think is they're ex-employees, question one. Question two the orders sought.
PN63
MR JOSEPH: Yes.
PN64
THE COMMISSIONER: Now I accept that in respect of a second argument what's been put by Mr Latham today by way of an amendment, and I don't put it any higher than just maybe I'll put it as a change. Because there may not be an amendment or correction as 586 contemplates. I think that that would likely mean that we just can't deal with the second limb but we can still deal with the first limb. The matter might be resolved on that basis.
PN65
MR JOSEPH: I must say that's entirely - that in itself is unfair to my client. It's not right that somebody turns up - I mean that has been and my learned friend's, on behalf of his clients has put on written submissions, Commissioner.
PN66
THE COMMISSIONER: I guess what I'm proposing - sorry, Mr Joseph, what I'm proposing is why don't I just hear the parties on the ex-employee issue. If I decide against the applicants on that issue then it's all over red rover. If I decide in favour of them on that, then we'll come back and fight the orders issue another day.
PN67
MR JOSEPH: I must say - well, it's a most unsatisfactory turn of events given that the issue's been flagged for several weeks, Commissioner.
PN68
THE COMMISSIONER: I accept that.
PN69
MR JOSEPH: There must be, in my submission, there must be costs implications for this. But I'm not agitating that right now, I'm simply raising it as an issue. Just bear with me for a moment.
PN70
I think one of the problems - I must say, where we don't know what's going to be sought, Commissioner, I suspect the grounds and reasons would also change significantly. I appreciate there's a discreet point. I accept there's a discreet point on the ex-employee matter, Commissioner, but I must say I don't know that you can view it in isolation in the context of the statutory provision we're dealing with from what's being sought. I hope I'm making myself clear to a degree.
PN71
THE COMMISSIONER: Yes.
PN72
MR JOSEPH: Because I'm not sure what might be contemplated in any amended fresh varied application. Not only in terms of the orders sought but also in the grounds and reasons that might be put as well.
PN73
MR LATHAM: We're not seeking to vary the grounds.
PN74
THE COMMISSIONER: If we look at 526, 526(2) deals with, "The FWC may deal with a dispute by arbitration". That is really where, if you like, the prayer for relief or orders sought falls. The ex-employee point is dealt with under 526(3). They do seem to be quite discreet. Why couldn't I deal with the 526(3) matter now. As I say, if it goes your way then that's the end of the matter anyway.
PN75
MR JOSEPH: Well Commissioner, I can really only repeat what I've already said. I appreciate that is - ultimately we're in the Commission's hands as to how you deal with the matter. We've been blindsided by - this is not a minor change, this is a very significant - effectively I think it concedes - my learned friend may not agree with this but I think it concedes the point we're making about the re-cram issue, which I think is appropriate. But I am concerned about - I am concerned that my client should be given a proper opportunity to look at any new application or fresh application if you were going to allow an amendment in its entirety.
PN76
THE COMMISSIONER: Yes, I mean I would want some submissions on whether or not this is properly a 586 amendment or corrections as opposed to a new application.
PN77
MR JOSEPH: Yes.
PN78
THE COMMISSIONER: I mean it can't be that it's said that it's correcting an irregularity, so it's not subparagraph (b). It must be either an amendment or correction and the change, and I use that neutral language at this point, the change in the orders sought, does that create a new application or is it properly an amendment or correction. Mr Latham, what do you say? Do you say it's an amendment or correction or how does it fall within 586 when you've completely moved the goalposts?
PN79
MR LATHAM: It's an amendment. If I can just put this and I think we can deal with this fairly quickly. The Commission is not a court, it's not a court of strict pleading, it's not even a court of pleading. The orders sought, regardless of what they would say, do not determine the way the Commission exercises jurisdiction. The orders themselves at the moment are not entirely clear and they are not clear as to on what basis any such order should be made. We believe that we've got - the Commission's got jurisdiction to deal with this in any event, but it is an amendment that does make the position clearer. It's not a correction and it's not - - -
PN80
THE COMMISSIONER: It doesn't make it clearer to me as to what you want.
PN81
MR JOSEPH: It's fundamentally a new application, Commissioner, I'm sorry.
PN82
THE COMMISSIONER: Hang on, hang on. I'm hearing from Mr Latham.
PN83
MR LATHAM: We can make those submissions about amendment as opposed to a new application later but for example, the Commission has already on a number of occasions amended, for example, an unfair dismissal case into a general protections case. The powers in relation to amendment are very, very broad - - -
PN84
THE COMMISSIONER: No, no, no I think I sat on that Full Bench when we said that that wasn't possible.
PN85
MR LATHAM: That might be a more recent one. But anyway, the powers in relation to amendment are very broad. The discretion under the section is essentially unfettered. We are entitled to seek such an amendment, and we think it's a more efficient way of dealing with this matter, for that amendment to be made.
PN86
THE COMMISSIONER: It's not going to be more efficient, because I'm going to have to adjourn it off and reprogram it in relation to that. It might be ‑ ‑ ‑
PN87
MR LATHAM: I would accept that, Commissioner.
PN88
THE COMMISSIONER: It might be allowable, but at the end of the day I'm still bound by the principles of natural justice, and it coming out of the blue like this for the respondent, I'm going to have to let them have an opportunity to think about ‑ ‑ ‑
PN89
MR LATHAM: I'm not asking you to dismiss it.
PN90
THE COMMISSIONER: ‑ ‑ ‑ whether or not it's properly within 586, and what it means for their case, and what it means for their objections. It's going to have to be adjourned. That aspect of it is going to have to be adjourned off. It's not more efficient at all.
PN91
MR LATHAM: I accept that, Commissioner.
PN92
MR JOSEPH: Commissioner, my submission would be that the commission could dismiss the current application. If my learned friend's client isn't prepared to withdraw and start again the commission could dismiss the application by hearing the application as it currently stands and hearing my client's views in relation to jurisdiction.
PN93
THE COMMISSIONER: What I propose to do, having heard from counsel in the matter on both sides, is to proceed on the basis that I will hear the full argument today in relation to both 526 subparagraphs (3) and (2) on the basis that in relation to (2) there has been a change sought in relation to the orders sought; and then having heard all of that, I would allow the respondent additional time if they want to make further submissions or call the matter back on to make further submissions in respect of that issue of the orders.
PN94
I will allow you a week to consider your position. It might be that you're happy with how things have gone and you don't want to further ventilate the issue of the orders being changed; but if you do, then I will bring it back on and allow submissions to be made.
PN95
MR JOSEPH: I'm sorry, Commissioner, I'm not meaning to be difficult, but I think we would be entitled to see what the orders ‑ ‑ ‑
PN96
THE COMMISSIONER: We know what the order is that they want. They want me to pull something out of thin air and order them money. That's how read the minute of orders.
PN97
MR JOSEPH: No, I understand. I'm not trying to be difficult, Commissioner, but I'm simply perhaps amplifying or putting a different way what you've just put. We're entitled to see something in black and white.
PN98
THE COMMISSIONER: It's:
PN99
The respondent pay the applicant an amount that is fair in the circumstances.
PN100
That's the note that I took.
PN101
MR LATHAM: Yes, that's correct.
PN102
THE COMMISSIONER: That's what they want. As I say, let's bat on. But I will allow you till the end of the week to notify my chambers as to whether you want to make further submissions just on that issue, or whether you want the matter brought on. I will be entirely in your hands as to, from a natural justice perspective, how we deal with that issue after today.
PN103
MR JOSEPH: Yes. Thank you. Is that solely on the jurisdictional question, or also on my friend's application to actually amend in itself?
PN104
THE COMMISSIONER: Yes, both.
PN105
MR JOSEPH: Thank you.
PN106
THE COMMISSIONER: All right. So I have the submissions and I've read those. What do I need to do with the witness evidence? We're not going to hear from the witness, we're just going to receive all of that. It's really just factual matters, isn't it?
PN107
MR JOSEPH: They are. They are. I must say, my learned ‑ ‑ ‑
PN108
MR LATHAM: We have about two questions of the witness.
PN109
MR JOSEPH: And I must say, in those circumstances I'm very firmly of the view that cross‑examination - it's not appropriate for cross‑examination to take place on a jurisdictional application. So we weren't intending to tender - if that was going to be an issue, we weren't intending to ‑ ‑ ‑
PN110
THE COMMISSIONER: So I should just mark them.
PN111
MR JOSEPH: That would be our preferred view, that they should be marked, but cross‑examination shouldn't be allowed. I would have thought everybody's rights are reserved on any final hearing, if we ever get there, Commissioner, to put on evidence and to have the case heard.
PN112
THE COMMISSIONER: What I plan to do is mark all the documents. Mr Latham, you said you wanted to cross‑examine someone, did you?
PN113
MR LATHAM: I wanted to cross‑examine Mr Ackland by about two questions. I'm not quite sure what my friend is proposing, but if my friend proposing that the evidence just go in and be accepted on its face? Is that what's being said?
PN114
THE COMMISSIONER: It's like an interlocutory ‑ ‑ ‑
PN115
MR JOSEPH: Exactly.
PN116
THE COMMISSIONER: It's like an interlocutory matter.
PN117
MR JOSEPH: Precisely.
PN118
MR LATHAM: If that's a practice, I'm happy to deal with it on that basis, then. There are just two objections that we do wish to make. The last sentence of paragraph 4 and paragraph 6 are conclusions as to law.
PN119
MR JOSEPH: No, I accept that.
PN120
MR LATHAM: So perhaps if they might be deleted.
PN121
MR JOSEPH: Yes.
PN122
THE COMMISSIONER: Sorry, paragraph 4 where it says, "the assistant driller position is not covered by an industrial instrument". Is that ‑ ‑ ‑ ?
PN123
MR LATHAM: Yes. And to the same effect in paragraph 6.
PN124
THE COMMISSIONER: That's agreed to, is it, Mr Joseph.
PN125
MR JOSEPH: And also paragraph 8, if I can help.
PN126
MR LATHAM: Sorry, that's right.
PN127
MR JOSEPH: We don't read those; don't rely on those sentences for present purposes.
THE COMMISSIONER: Yes, I understand. All right. The respondent's submissions regarding jurisdictional objection dated 14 August 2015 will be exhibit R1.
EXHIBIT #R1 RESPONDENT'S SUBMISSIONS REGARDING JURISDICTIONAL OBJECTION DATED 14/08/2015
THE COMMISSIONER: The affidavit of James Ackland will be exhibit R2.
EXHIBIT #R2 AFFIDAVIT OF JAMES ACKLAND
THE COMMISSIONER: The applicant's submissions regarding jurisdictional objection dated 21 August 2015 will be exhibit A1.
EXHIBIT #A1 APPLICANT'S SUBMISSIONS REGARDING JURISDICTIONAL OBJECTION DATED 21/08/2015
THE COMMISSIONER: The statement of Timothy Schell will be A2.
EXHIBIT #A2 STATEMENT OF TIMOTHY SCHELL
THE COMMISSIONER: The statement of Nathan Wollman will be A3.
EXHIBIT #A3 STATEMENT OF NATHAN WOLLMAN
THE COMMISSIONER: The statement of Scott Colwell will be A4.
EXHIBIT #A4 STATEMENT OF SCOTT COLWELL
THE COMMISSIONER: The statement of Chris Cootes will be A5.
EXHIBIT #A5 STATEMENT OF CHRIS COOTES
THE COMMISSIONER: And the respondent's reply submissions dated 28 August 2015 will be R3.
EXHIBIT #R3 RESPONDENT'S SUBMISSIONS IN REPLY DATED 28/08/2015
PN136
THE COMMISSIONER: Thank you. Mr Joseph.
PN137
MR JOSEPH: Can I just clarify, my client's submissions that were 14 August, was that R1 or R2?
PN138
THE COMMISSIONER: 14 August is R1.
PN139
MR JOSEPH: And then Mr Ackland's statement is R2.
PN140
THE COMMISSIONER: R2.
PN141
MR JOSEPH: Thank you. Commissioner, I think I'm likely to be reasonably brief. Can I hand up - I won't take you to it at any length, but can I hand up a copy of Re Cram.
PN142
THE COMMISSIONER: Yes. Thank you, Mr Joseph.
PN143
MR JOSEPH: I will come to that case in a moment, Commissioner. Does the commission have - all the applications are currently in the same terms - does the commission have Mr Schell's application?
PN144
THE COMMISSIONER: I do. That's the leading file, and that's the one I'm generally working off, yes.
PN145
MR JOSEPH: We see that presently - and again, I don't want to labour the point because of what my learned friend has flagged, but we see the orders sought are that the respondent pay the applicant an amount owed from 16 December 2014 to 15 May 2015, to be calculated; secondly that the respondent pay the applicant the usual entitlements that would have accrued but for the stand-down. I presume what that means is accrued annual leave or something of that nature, Commissioner; and thirdly, costs, although I don't know that - anyway.
PN146
That's the way the applications currently present themselves. Whilst we dealt with this matter secondly, Commissioner, I think I should deal with this issue first in this way: you will see in our first written submissions, commencing at paragraph 22, we've dealt with the issue as to whether the commission can make monetary orders. And I won't repeat what's written at 22 to 26, but I think there are two issues. And again, these may disappear, depending on what happens with the applications.
PN147
But dealing with the most important issue first, if I can take the commission to Re Cram, which I handed to you. The commission will, of course, be aware that after the Boilermakers case in 1956 it was made clear by the High Court that a commission in its various guises could undertake arbitral powers or could undertake arbitral functions but not judicial functions. There's a clear distinction. That remains to this day.
PN148
MR LATHAM: Clear distinction?
PN149
MR JOSEPH: Well, sorry. There's a distinction that remains to this day. Perhaps it's not always clear, as my learned friend says. But in this case we would say it is.
PN150
THE COMMISSIONER: But isn't the judicial function the resolution of immediate or past rights; and the arbitral function the creation of a future right?
PN151
MR JOSEPH: In short form, that's a pretty neat summary, Commissioner. That's a pretty neat summary. The commission will see, commencing at page 148 at about point 2, that the joint judgments there in Re Cram identifies that:
PN152
A claim for the payment of wages due and payable by an employer to an employee is a claim for the enforcement of an existing legal right. Likewise, a claim for the enforcement of a provision of an award is the enforcement of an existing legal right.
PN153
The court then goes on to identify that that is an exercise of the judicial power of the Commonwealth that can only be undertaken by a Chapter III court. And it then goes on to say that the commission - well, it was then dealing with another body - but to say that a body, of which the commission is one, is not armed with judicial power.
PN154
Then at about point 7:
PN155
The result is that the Authority had no jurisdiction to determine or enforce a legal right to payment of wages on the part of employees in respect of a past period during which they had been stood down or refused work or to enforce the provisions of an award regulating the right to payment of wages of employees for such a period.
PN156
Based on - certainly at least based on what the orders say that are being sought in the applications at present, that particular passage is entirely on point. There's no question, in my submission, that the orders, as they are currently framed, effectively seek back-pay.
PN157
There's nothing in the way that the applications are drafted that would suggest otherwise. You will see, without me taking you back to the - well, perhaps if I take you back to the application - Mr Schell's application - just briefly, Commissioner, before I go on. You will see there at point 11 there's an allegation of breach of section 524 in relation to the stand-down.
PN158
If one reads the grounds, there's an allegation that the enterprise agreement - there was an enterprise agreement that was in force and that the Act has been breached. And I think reading that in context, the only possible conclusion can be that what is being sought here is the enforcement of an existing legal right.
PN159
True it is that on the following page, page 149 at about point 4, that in the same joint judgement the Court goes on to say:
PN160
A tribunal may find it necessary to form an opinion as to existing legal rights as a step in arriving at the ultimate conclusions on which the tribunal bases the making of an award intended to regulate the future rights of the parties ... of course, the formation of such an opinion does not bind the parties and cannot operate as a binding declaration of rights.
PN161
MR LATHAM: Read the next five lines.
PN162
THE COMMISSIONER: Mr Latham.
PN163
MR LATHAM: Sorry. I apologise. I withdraw that.
PN164
MR JOSEPH: I will leave it. The commission has had it identified for you. If the commission wants me to take you to it, I shall.
PN165
THE COMMISSIONER: Maybe go to it and tell me what you say about it.
PN166
MR JOSEPH: That needs to be read in - the determination - what's being said there is a reference to Kitto J's comments in another case where he says:
PN167
The distinction between a power of arbitral decision in respect of the future and a power of judicial determination of existing rights and obligations.
PN168
Despite that reference:
PN169
The arbitral function includes the determination of a dispute relating to past transactions, events and conduct.
PN170
I don't think there's anything too remarkable about that. That would be read in the context of what is earlier said, Commissioner, about the fact that the tribunal might be forced to form a view about things that have happened in the past, but can't change what powers the commission, in exercising of arbitral function, would be able to do by way of binding the parties before it.
PN171
THE COMMISSIONER: Yes.
PN172
MR JOSEPH: I mean, the commission might form a view - the commission might form a view - - -
PN173
THE COMMISSIONER: In order to create the future rights we have got to look at what has happened in the past.
PN174
MR JOSEPH: Of course.
PN175
THE COMMISSIONER: That's all it is saying, isn't it?
PN176
MR JOSEPH: Of course. Exactly. But the commission can't, for example, say, "I find that clause 9 of the enterprise agreement has been breached." You could say that, Commissioner, but I wouldn't have any legal effect, in that it couldn't bind the parties is a right, for example. But you could form that view, and that view could form the basis of something that you're otherwise entitled to do.
PN177
Just further on this point, Commissioner, if I go to the outline of submissions in reply, which is R3. I refer you to paragraph 12 of those submissions, because one of the ‑ ‑ ‑
PN178
MR LATHAM: Sorry, paragraph?
PN179
MR JOSEPH: Paragraph 12 of the submissions. That's effectively, I suppose, a repeat of what has already been said, but there was an issue there about the manner in which the application was being put before the authority in question, and the court was effectively going to the very nub of the dispute and saying, "Well look, what's being sought here is payment for a past period that hasn't been made on the basis of an alleged entitlement," and we say that that would apply here.
PN180
Unless you need to hear from me further, or subject to anything in reply on the Re Cram point, if I can say that, Commissioner, I will move on. The next point that I wanted to deal with it, this is again, I suppose, connected in the context of the orders as they are currently being sought, to the extent that they seek, effectively, compensation. The power of the tribunal, Commissioner, in this provision, in section 526 subsection (2), is to deal with a dispute by way of arbitration.
PN181
That's helpful and unhelpful in that the provisions do not identify what the tribunal can do; not in any real, meaningful, or dare I say helpful sense. It is entirely different to, for example, the unfair dismissal provisions.
PN182
THE COMMISSIONER: Have there been many decisions in this area?
PN183
MR JOSEPH: Not many - sorry.
PN184
THE COMMISSIONER: And how have other members dealt with them by arbitration? What have been the outcomes?
PN185
MR JOSEPH: I might need to take that one on notice, Commissioner. There is a suggestion - I've only seen two applications, both of which were dismissed, but I'm sure there have been others. So I might take that on notice, if I may. But I didn't find - in the time I had available I didn't find anything particularly helpful in the way of jurisprudence to assist the commission in this present matter. However, if I can just continue.
PN186
And the examples that are provided in the explanatory memorandum don't really fit this situation, if I can put it that way. I didn't see anything in that provision - in that document that was particularly helpful either. My point is this, I suppose, Commissioner: if you go to section 595 subsection (3), it says that:
PN187
The commission may deal with a dispute by arbitration -
PN188
and then in parenthesis -
PN189
(including by making any orders it considers appropriate) only if the FWC is expressly authorised to do so under or in accordance with another provision of this Act.
PN190
That provision in in itself also raises some interesting questions as to whether the phrase "expressly authorised" means simply being expressly authorised to arbitrate, or expressly authorised to do some particular things in the conduct of an arbitration. In my client's submission, as we've set out in the written outline, the ability - what's being sought here well after the - - -
PN191
THE COMMISSIONER: What if the application had been made - what if the application had been made in March? What orders could I have made: an order that the employer no longer stand down the employees?
PN192
MR JOSEPH: Yes, I think that's right.
PN193
THE COMMISSIONER: An order that in respect of the period up to that order, they be paid wages?
PN194
MR JOSEPH: I'm not sure that that's right, Commissioner. I was thinking about this, and there's an example given in the explanatory memorandum where somebody was on annual leave and they're not paid for the two days of annual leave, and the explanatory memorandum says during a five-day stand-down where somebody was already on leave, that an order could be made ordering the employer to pay them for the two days' leave.
PN195
THE COMMISSIONER: Re-credit their leave?
PN196
MR JOSEPH: Re-credit their leave, yes. That's not really very helpful, because there's a particular provision in 525 that deals with the interplay between stand-downs and leave. I must say, I think the better view is absent a specific power, in my submission, to order compensation, which is effectively back-pay, the commission would not have the power to do that; as distinct from an order that the stand-down cease.
PN197
If one looks at 527, one sees that there is a civil remedy provision about contravening a term of an order dealing with a dispute about the operation of the Part. I must say again there isn't necessarily a lot of contextual help one way or another, but it suggests that what is being envisaged is to resolve a dispute - resolve an existing real dispute about stand-down going forward.
PN198
THE COMMISSIONER: Creating an obligation in the future to either re-employ them or pay them or - - -
PN199
MR JOSEPH: Yes. Yes. But I think - I must say, if you look at it the other way, Commissioner, it seems to me that one would be going into an area of what must be existing legal entitlements. I mean - - -
PN200
THE COMMISSIONER: It's a bit like - maybe I should explore this more with Mr Latham - it's a bit like when a classification dispute comes before the commission under section 739.
PN201
MR JOSEPH: Yes.
PN202
THE COMMISSIONER: And the employee says, "I should be classified as a higher level." What the commission determines then is: what is the classification of the employee moving forward?
PN203
MR JOSEPH: Yes.
PN204
THE COMMISSIONER: But it doesn't decide - having decided that the employee should be at the higher level moving forward, the commission then doesn't say, "Well, in respect of the period before I decided that, you should get back-pay."
PN205
MR JOSEPH: Yes.
PN206
THE COMMISSIONER: The employee still has to go off somewhere else to get that.
PN207
MR JOSEPH: That's exactly right. That's exactly right. I think that's - and I must say, I think that's - - -
PN208
THE COMMISSIONER: Isn't that analogous?
PN209
MR JOSEPH: I think it is, because it is - we're being told at section 526 that the commission may deal with a dispute by arbitration. That is the classic arbitral function - the award-creating function going forward. I mean, it may be that - and is often the case - that things get resolved between parties in relation to past matters once the commission has formed a view and determined what should happen going forward.
PN210
But I must say, given that there has been, in Australia, this distinction between judicial and arbitral functions going back to 1956 at least, one would have thought that if this provision was to suggest that the commission could do something which clearly goes into the other area, you would think there would be a lot more to the provision or there would be a lot more detail in relation to the provision.
PN211
We suggested this in the written submission, that that's clearly set out in relation to unfair dismissals. As I'm sure you know, Commissioner, the unfair dismissal provision is written in a particular way which says that the commission - I mean, often as a matter of practice if the commission reinstates somebody, then it will make an order for what we call back-pay, but it's not really - it's not a determination of a contractual dispute, it's taking a whole series of things into account where there's an express power to make an award, as it were, in relation to a period of time past.
PN212
This must be a different provision, and we say that power just isn't there, other than in relation to future matters. Obviously that second - depending on what the commission allows to be done in relation to the application, this second argument that we're making subject to, perhaps, a bit of time for reflection on the submission as I put it, would apply to an amended application as well, I would say.
PN213
If I can then - and I note the time, Commissioner, so if I can deal with the first question. I think I've dealt with it in part by my - because I think this issue of being able to distinguish between an arbitral function and a judicial function is relevant to determining the manner in which the division, or this particular part of the Act is meant to operate.
PN214
Whilst I acknowledge that the definition of employee in the Act includes the difficult term "usually an employee" in - I think it's section 14 of Act, which has the potential to broaden who might bring an application - I don't think, with respect, that is the appropriate manner in which to define - I don't think that's the proper way in which employee should be defined in this particular division or part of the Act. My learned friend put, in his written outline, well what happens if a person goes to make a, and I'm paraphrasing so I don't want it to be seen to not properly represent what he's saying, somebody who was employed and then identified that they were going to make an application, for example, and got dismissed.
PN215
In my submission, someone who's been dismissed for whatever reason has remedies one way or another but not through this provision. If the remedy is in relation to being dismissed, then there are other powers that the Tribunal has in relation to that. If the remedy is in relation to somebody who's been dismissed but is in relation to a past period, then we say the remedies are somewhere else if they allege that they were stood down other than in a manner that complies with the law. And that would be the case whether it was in reliance on an enterprise agreement, an award or a contract.
PN216
It's a matter of context and I must say I also couldn't find any decisions, Commissioner, which helped in this context. Certainly all of the examples in the explanatory memorandum all pre-suppose, and I don't put it any higher than this, I'm not suggesting that that determines the matter, but they all pre-suppose an ongoing or an existing relationship and I had dealt with this briefly in the context of the use of the phrase in 526(3)(a), which is applicable in this case, which says that:
PN217
The FWC may deal with the application only on application by any of the following: an employee who has been or is going to be stood down under section 524(1),
PN218
and so on. I concede that the phrase has been - clearly identifies a situation where the stand-down has already occurred. I think as a matter of logic and reality I have to accept that that's one of the positions. The issue is who is an employee in that context? Is it an existing employee or can it include an ex-employee? Because I don't think if the Tribunal, if we think our way through this, Commissioner, if the Tribunal had the power to reinstate somebody in this provision, in this part of the Act, one would think something like that would be clearly identified.
PN219
In my respectful submission, what is being intended in this part of the Act when the Commission deals with a matter by way of arbitration it is dealing with, in effect, a dispute about a stand-down where there is an existing - an employment relationship on foot. Just bear with me for a moment. We're just undertaking some searches just in terms of the scope but I think perhaps we might need to deal with this at some time in the next few days. Just in terms of the scope of the provision as it's being utilised by the Commission in the past, the types of order, that doesn't necessarily tell the Commission one way or another what the outer limit of your powers are but certainly the manner in which the stand-down provision's been exercised in the past might help to illuminate, to some degree.
PN220
I think the only other thing I can add now, subject to hearing from my learned friend, is that we acknowledge that in other contexts, as I've said in the written - we've said in the first written outline, for example, in relation to the freedom of association provisions, there's clearly a legislative or an intent to allow, quite properly, former employees to agitate for entitlements or to exercise rights in relation to their past employment. But again, that's actually clearly identified in that - - -
PN221
COMMISSIONER JOHNS: It says express power.
PN222
MR JOSEPH: Yes, yes. And I must say, absent that, we say that's just not available to the Commission here, Commissioner. Unless I can be of assistance further, and subject to how we go for time, I'll leave our submissions at that point.
PN223
COMMISSIONER JOHNS: Thank you, Mr Joseph.
PN224
MR JOSEPH: Thank you.
PN225
COMMISSIONER JOHNS: Mr Latham.
PN226
MR LATHAM: Commissioner, could I deal with this in a fairly thematic sort of way. There seemed to be three major issues raised by my friend. The first issue is the notion of employee in terms of the Act. The second is in relation to the need or otherwise for an express power as to compensation before compensation can be ordered, and then the third issue is whether the Commission is, or would be, exercising judicial power in these proceedings. I might just deal with them in that order.
PN227
The question about employee is a matter that has been floating around the industrial system now for decades and is dealt with in the case of Belandra. I'll just hand up the relevant parts of that case that deal with this point. As the Commission will know, that's a decision in relation to freedom of association provisions and the question in that case was whether the freedom of association provisions applied to people who were ex-employees in the sense that they had been terminated and were not working at that stage.
PN228
His Honour, North J, goes in some detail - sorry, I should just cite it, this version is at 126 IR 165, and the Commission will find the arguments set out at paragraph 29 and 30 of the respondents in that case, and the argument you'll see at paragraph 29 at page 176 is that, this is relation to Belandra being the employer, was not whether it was an actual employer but whether it was usually an employer at the time within the meaning of section 4(1), and you'll see that, in particular, there's a reference at paragraph 30 to Mr Parry SC who referred to:
PN229
The definition of employee made in 1910 to include any person whose usual occupation is that of employee in any industry.
PN230
The Commission will find at page 178 at paragraph 38, a reference to the case of North West Exports at the top of the page referring to:
PN231
Seasonal shutdowns and variable supply of stock, that employment in the meat industry exhibited special characteristics, in particular the notion of regular daily hire and how at a normal common law proposition that regular daily hire would mean that the person was no longer an employee at the end of the regular daily hire.
PN232
As the Commission will know, there are similar cases in relation to casual waterside workers and casual employees generally. The point is then made at paragraph 42 in conclusion whether the facts of the case demonstrated that Belandra was usually an employer or not, and you'll see references to the arguments of Belandra there. His Honour goes on at paragraph 43 to say:
PN233
Whether a person is usually an employer is a question of fact to be determined in light of all the circumstances in each case. There is no formula. It may be relevant to know how long a person ceased to be an employee,
PN234
and so on. If one uses the obverse of those terms and puts in the word employee instead, the principles are the same.
PN235
COMMISSIONER JOHNS: But just deal with it in this context, we're looking at 526(3)(a) about who can make the application and it says an employee. The common law presumption applies to that definition of employee unless there's something else, should be said it's defined somewhere else, somehow else. How should I define it differently than the common law definition?
PN236
MR LATHAM: Because at the beginning of the chapter ‑ sorry, Commissioner, could I just have one moment. Actually can I just borrow my friend's very excellent service. Section 523 defines employee for the purposes of this part, being part 345, to mean a national system employee and national system employee is, in turn, defined in the - - -
PN237
COMMISSIONER JOHNS: Section 14.
PN238
MR LATHAM: Yes and that is a broader proposition than the notion of employer at common law. That's the argument on that point. Could I just say in relation to the facts of this case, there is clear evidence that these people, the applicants in the case, both were - - -
PN239
COMMISSIONER JOHNS: No, no, no. I'm still not there.
PN240
MR LATHAM: Sorry.
PN241
COMMISSIONER JOHNS: I accept that the employee in 526(3)(a) is to be a national system employee by virtue of 523. I then come to section 13:
PN242
A national system employee is an individual so far as he or she is employed or usually employed as described in the definition of a national system employer in section 14 by a national system employer except on a vocational placement.
PN243
How is it said that the applicants in these matters - well it can't be said that they are employed by the national system employer can it?
PN244
MR LATHAM: No.
PN245
COMMISSIONER JOHNS: You say they're usually employed?
PN246
MR LATHAM: Yes.
PN247
COMMISSIONER JOHNS: At the time they made the application?
PN248
MR LATHAM: Yes. Because they have had work and they are seeking work and that's - - -
PN249
COMMISSIONER JOHNS: No, they have to be usually employed by the national system employer.
PN250
MR LATHAM: Yes. In the same way that a meat worker has to be usually employed and was not at a particular time employed but was still held to be subject to the usual employer. It's the same concept. Could I just put some examples so that the position might be made clearer. One example might be a person who ceases work and who never seeks work again and who never achieves work again.
PN251
There would be a strong factual argument in relation to North J's proposition that that person is not usually an employee and what his Honour says is one needs to look at the factual context, there's no formula but in those circumstances you could legitimately say this person is not in work and they are not seeking work and therefore they are not usually an employee. But that is not this situation.
PN252
This situation, we have employees who are seeking work and we have an employer who has said we will try and get work for these people.
PN253
COMMISSIONER JOHNS: But if they were so aggrieved by this stand-down, why didn't they bring the application during the period of the stand-down?
PN254
MR LATHAM: I don't know and I'm not being coy and I wasn't involved.
PN255
COMMISSIONER JOHNS: Because if you're right about the construction, the employee gets to sit on their hands and then bring the application any time they like later in time after the employment relationship's ended and claim some measure of back pay or something referable to that. Surely the whole public purpose behind 526 is where it says an employee who has been, it means is, the employee who is being stood down or the employee who is going to be stood down so that they can complain about it and stop it from occurring so that they can stop the adverse consequence of the stand-down which are they don't get paid.
PN256
MR LATHAM: Commissioner, the Parliament would have been quite entitled to put that proposition but they didn't and the words 'has been' - - -
PN257
COMMISSIONER JOHNS: Means is.
PN258
MR LATHAM: No, no. The words 'has been' means that it has happened in the past, not is.
PN259
COMMISSIONER JOHNS: Yes, the act of stand-down occurred.
PN260
MR LATHAM: Has occurred, yes.
PN261
COMMISSIONER JOHNS: And so the employee's currently in a state of stand-down and therefore can bring the application or is about to be stood down, they're the two bases upon which the application can be brought, surely.
PN262
MR LATHAM: Well that requires the implication of the words 'and is no longer employed' and that's not justified contextually.
PN263
COMMISSIONER JOHNS: Yes, all right.
PN264
MR LATHAM: But anyway, I'll leave it at that just for the moment. Could I just say, if one goes to the evidence of Mr Ackland, you will see at attachments JA5 and JA6 the reference to work declining and that it is hoped that that decline will be only temporary and that work will be re‑assigned. We put this proposition simply that in terms of the factual context of this case, while these people are not actually working as employees at the moment, there's a contemplation on both sides that that may occur in the future and that's part of the factual background that the Commission has to take account of. In relation to the compensation point, that can be - - -
PN265
COMMISSIONER JOHNS: But no, I mean I must say that had this application been brought during the period of the stand-down I think I might have been with you in the view that this is not properly a stand-down situation, that this was not for any cause that the employer could not reasonably have been held responsible. Otherwise, every time there's an economic downturn, employers would be allowed to rely upon this section and have people stood down without pay just because they didn't contemplate that the dollar was going to slide to 70 cents or just because they didn't contemplate that something else might happen in the terms of trade or whatever.
PN266
That can't possibly have been the intention of the stand-down provision. Had it been brought during the life of the stand-down period, well likely or not I would have been with you. What I'm really struggling with is whether or not the application had been brought after the stand-down period once they ceased to be employees. That's the real issue that I'm particularly struggling with.
PN267
MR LATHAM: No, I understand the proposition. We just say, and it's always difficult to interpret legislation, we just say on the ordinary reading of the words in the section, the sort of proposition that the Commission's putting is one that requires indication of further words. There's no warrant for that to occur.
PN268
COMMISSIONER JOHNS: Yes, I understand what you say.
PN269
MR LATHAM: Dealing with the issue of compensation, the argument can be very simply put. My friend puts an argument that because there is no express power to order compensation, the Commission cannot do so. That's really an argument about - -
PN270
COMMISSIONER JOHNS: Tell me another time, other than in the unfair dismissal jurisdiction, where I have the power to order compensation, or commissioners or other members of the Tribunal have ordered compensation, outside of the unfair dismissal jurisdiction.
PN271
MR LATHAM: The dispute settlement procedures, Commissioner.
PN272
COMMISSIONER JOHNS: Well, where's a decision where there's been an order of compensation?
PN273
MR LATHAM: I don't have one here but I can, within 24 hours, produce that to the Commission. Could I just say, I mean this is a shorthand way of putting it, contextually these provisions are very similar to the dispute settlement provisions in the Act. The dispute settlement provisions in the Act do not set out an express power to award compensation. They do talk about arbitration and they have a very general power, in the same way that this is a very general power, to deal with these matters.
PN274
By contrast, if one looks at the bullying provisions, what is it, 789AF and so on, those provisions specifically say that compensation is not to be awarded. If my friend was correct contextually about saying there is a need for these matters to be express, sorry a power for compensation to be expressed, there would be no need in the bullying provisions to say compensation may not be awarded.
PN275
COMMISSIONER JOHNS: But do you accept the analogy that I drew with the section 739 application where there's a dispute about the interpretation of an enterprise agreement or classification dispute or whatever, and the only power the Commission has is to decide what will be the classification of employee moving forward. The Commission cannot say and therefore up until the date of my decision you have to back pay.
PN276
MR LATHAM: I'm not sure that that's correct, just for this reason - - -
PN277
COMMISSIONER JOHNS: It might be that just that I've never done it.
PN278
MR LATHAM: Yes. That's correct but - - -
PN279
COMMISSIONER JOHNS: Because I have formed the view, and generally I've been of the view, that that is the exercise of judicial power. It's not arbitral.
PN280
MR LATHAM: Perhaps we might move to that in just a moment because that's perhaps the most substantial issue in all of this. Could I just say this, my friend said that the distinction between judicial power and arbitral power is clear. That's a brave assertion, it's not one that I make. The distinction between arbitral power and judicial power is very complex and very ill-defined but what the courts have made clear, there are a number of issues that need to be taken into account when dealing with the matter.
PN281
One thing that does need to be taken into account, as counterintuitive as this seems, is that the body hearing the application, or whatever it may be, whether it is an arbitral body or a judicial body, to some extent may inform the debate about what powers are being exercised. For example, in Dingen, which my friend's referred to, that was a power that went from, I may have got this slightly wrong, but I think it went from the Federal Court to the Commission and then back to the Federal Court or perhaps it went from the Commission to the Federal Court, but in that case, for example, the fact that the powers being exercised by an arbitral body was used by the court to say well that indicates that this is an arbitral power.
PN282
The second thing, I think, is this, it depends, to some extent, on the powers being exercised and it's often difficult to define what is an arbitral power as opposed to a judicial power. But to give an example, if the matter relates to matters that are readily ascertainable legal rights, so, for example, a right under a contract is normally readily ascertainable by reference to legal principles, that is normally seen as the exercise of judicial power. If one is looking - - -
PN283
COMMISSIONER JOHNS: Isn't that what you want in this case? In a sense you want a declaration that what they did on 16 December in relation to Mr Schell was a breach of the Act.
PN284
MR LATHAM: No - - -
PN285
COMMISSIONER JOHNS: That they could not have lawfully stood him down on that day. You want that finding of fact don't you?
PN286
MR LATHAM: No, we don't want or need that, Commissioner. We want the Commission to deal with this dispute and that's the essence of the application.
PN287
COMMISSIONER JOHNS: But how do I deal with that without making a finding about what the respondent did on a particular date and whether that was consistent with what they were entitled to do under the Act?
PN288
MR LATHAM: That's a very good question, I'll answer that now. The Commission is entitled to make findings, such findings, that might be seen in other places as legal findings and that's set out in Cram and it's also set out in the Tristar case which I can hand up, we're all familiar with.
PN289
COMMISSIONER JOHNS: Tristar is very well known to me.
PN290
MR LATHAM: We're all familiar with that aren't we. Sorry, I should say one of the Tristar cases, that might be a better way of putting it. But as you might remember, in ‑ ‑ ‑
PN291
COMMISSIONER JOHNS: This is not the one that I'm familiar with.
PN292
MR LATHAM: No, no, no. Commissioner, in this part of the Tristar case, what was being discussed was whether a tribunal, being the - sorry, I think it was the AIRC at that stage, had the power to make findings in relation to breaches of various pieces of legislation as part of its arbitral function and if the Commission goes to paragraph 18, there's a very good summary of the law at the third sentence where the Full Bench stated:
PN293
It is well established, however, that the functions of a court or a tribunal may be classified as judicial or not according to the way in which they are to be exercised.
PN294
Hopefully I've made that clear already. You'll see then:
PN295
The power of inquiry and determination is a power which properly takes its legal character from the purpose for which it is undertaken. Thus inquiry into determination of matters in issue is a judicial function if its object is the ascertainment of legal rights and obligations. But if its object is to ascertain what rights and obligations should exist, it is properly characterised as an arbitral function when performed by a body charged with the resolution of disputes by arbitration.
PN296
The Commission there is quoted in the High Court saying two issues that are important are (1) is whether a judicial function is being exercised in those terms and secondly, which body is charged with the resolution of the dispute. Then you'll find out, and this is the important part in the second paragraph:
PN297
Inquiry into a determination of facts, for the purpose of ascertaining what rights and obligations should be brought into existence in settlement of an industrial dispute, does not cease to be an exercise of arbitral power merely because in the course thereof the Commission may form an opinion as to the existing legal rights and obligations of the parties.
PN298
You'll see there's a reference to Cram where it says:
PN299
The formation of an opinion as to legal rights and obligations does not involve the exercise of a judicial power at least if it is a step in arriving at the ultimate conclusion which is based on the making of an award intended to regulate the future rights of the parties.
PN300
COMMISSIONER JOHNS: Yes, that's the whole point isn't it?
PN301
MR LATHAM: Yes.
PN302
COMMISSIONER JOHNS: That's the whole point that what you would have me do is to ascertain a legal right. Did the respondent have a legal right on 16 December, if I've got that date right, to stand Mr Schell down and then you want me to award some compensation or something referrable to that finding and it's not about a future right. It's entirely about past conduct.
PN303
MR LATHAM: The question about future right is this, the future right is a right created by the order of the Commission, that's the first point. The second point is in relation to past conduct, and we had this discussion earlier on, as set out in Cram at page 149:
PN304
The arbitral function includes a determination of a dispute relating to past transactions, events and conduct.
PN305
If the Commission turns to the next page at the top of paragraph 19, the Commission there said:
PN306
In the course of determining that question, it's open to the Commission to form an opinion as to whether a party has breached a term of the agreement or not
PN307
sorry:
PN308
in question, such an opinion would not have the status of a judicial finding and would not be legally binding but for those reasons, it would not be beyond power for the Commission to form an opinion of the alleged breaches.
PN309
COMMISSIONER JOHNS: Yes, so that's exactly the 739 example I've used where the Commission says the employee should be classified higher than the employer does and that classification should have been that way for months.
PN310
MR LATHAM: Yes.
PN311
COMMISSIONER JOHNS: The Commission there is issuing an opinion that there has been a breach of the agreement in the past. It can do nothing to remedy it. It can only decide that from that point in the future, the employee is paid at the correct classification. The finding that there's been the breach in the past by the Commission does not help the employee at all by way of remedy.
PN312
MR LATHAM: Can I raise an analogy or, sorry, a contrary analogy?
PN313
COMMISSIONER JOHNS: Yes.
PN314
MR LATHAM: In relation to an unfair dismissal application, the Commission has a number of things it can do. It can make a finding, for example, of compensation which occurs prospectively, inevitably but it may make a finding in relation to re‑instatement which occurs retrospectively and it may also make a finding in relation to compensation or re‑engagement that also occurs as to the past. The Commission is not bound to only make orders that are prospective and could I give a really good - - -
PN315
COMMISSIONER JOHNS: That's a very different jurisdiction that's provided for expressly - - -
PN316
MR LATHAM: Could I give a better example then, an award, the making of an award which is a classic exercise of arbitral theory, sorry of arbitral - sorry, a classic exercise of arbitral power, an award may be made prospectively or it may be made retrospectively and that occurs regularly. In relation to an award with a retrospective operative date, that award changes past rights inevitably and the Commission has got power to do that and has dealt with it on that basis many, many times before. So the Commission should not let itself be led astray by a view that orders can only exist prospectively because that's not the case.
PN317
THE COMMISSIONER: Yes, thank you.
PN318
MR LATHAM: And, finally, could I just say this in relation to the question of the powers? If one looks at the order itself - sorry, the powers of the Commission under the section - those powers are extremely broad that the only criteria that seems to be relevant in relation to this question of fairness. That is a classic exercise of arbitral power. That is by reference to unascertainable policy conditions. That's exactly what arbitration is about.
PN319
And when the Commission is determining whether it has jurisdiction to deal with the matter or not it has to look at its own powers. And in relation to its own powers those powers, under the section are clearly arbitral. Commissioner, I don't think I've got anything further. Could I just have one moment?
PN320
THE COMMISSIONER: Yes.
PN321
MR LATHAM: I don't have anything further. Unless there's any questions, your Honour.
PN322
THE COMMISSIONER: All right. Thanks, Mr Latham. Mr Joseph?
PN323
MR JOSEPH: Yes, just subject to what you've said earlier about our being able to I suppose take a few days to deal with a couple of other points which I will clarify. I'd just like to make the following points, Commissioner. Arising from my learned friend's submission about the context in which section 13 is said to operate there is no evidence in these proceedings, there's no suggestion that there was any intention on anybody's part after I think the - all of the employees were terminated in May 2015 on the grounds of redundancy. There's no suggestion from anybody's witness statement that there was an intention beyond that date.
PN324
THE COMMISSIONER: No, I don't read that.
PN325
MR JOSEPH: To re-engage or recreate the relationship. In that context we would say that even if the - well, in that context we would say that employee for the purpose of section 526(3)(a) "employee" means somebody who is employed or usually employed by the employer in question and clearly the employees or the persons in this case do not fit into that category.
PN326
Secondly, on the question of the ability of the Commission in dispute resolution proceedings to make orders for compensation. In my experience, if I can put it this way, Commissioner, the making of any orders or determinations by the Commission which have involved compensation in relation to the past have arisen in the context where there has been an agreement by the parties that the Commission can determine those matters. And I think that's consistent with what the High Court said about the nature of the dispute resolution power in the CFMEU cases.
PN327
THE COMMISSIONER: They're private, yes.
PN328
MR JOSEPH: Yes, that's right. One thing I must say that struck me, Commissioner, the question that was raised and perhaps remiss of me not to raise this in the first instance that certainly these employees, whilst they were employees had several months to make the applications in question and one might ask why they didn't do so.
PN329
THE COMMISSIONER: I did ask that.
PN330
MR JOSEPH: Well, indeed, you did. But it struck me that for former employees there doesn't appear to be any time limit at all. And this may sound like - your Honour - the Commission might think this is a triviality or a formality that I'm raising but it does the raise the question. There is no time limit at all that is set for these applications to be made and there's no time limit because they're meant to be made, because the applications will need to be made while the stand-down is occurring.
PN331
THE COMMISSIONER: Or about to.
PN332
MR JOSEPH: Or about to occur. Because this is a classic - stand-downs are a classic industrial situation and it's about the determination of the rights to parties to an industrial dispute as it is traditionally understood, not some broader arrangement.
PN333
I think subject to the rights if we retain those to put something to you by the end of the week just in relation to certainly this last point that's been raised about an amendment to the application, and anything that might arise from that, particularly in relation to also some past decisions which we'll endeavour to look at. Those are the submissions for the respondent.
PN334
THE COMMISSIONER: Thank you, Mr Joseph. Well, you have until 4.00 pm on Friday to file any additional submissions either in relation to the matter or this issue about whether or not the application is capable of being changed in the way that the applicants seek.
PN335
MR JOSEPH: Yes, if the tribunal pleases.
PN336
THE COMMISSIONER: If there's nothing further then we are - sorry, Mr Latham?
PN337
MR LATHAM: Yes. Sorry, Commissioner. There was one issue. I was asked a question as to - - -
PN338
THE COMMISSIONER: You took on notice whether or not the Commission had ordered compensation in matters.
PN339
MR LATHAM: Yes.
PN340
THE COMMISSIONER: Yes. If you wanted to send a note to my Chambers about that I'd appreciate that as well.
PN341
MR LATHAM: I'll do so and I'll send a copy.
PN342
THE COMMISSIONER: But it's outside of the context of unfair dismissal.
PN343
MR LATHAM: No, no. Accept that.
PN344
THE COMMISSIONER: And it's outside of the context of - you know - private arbitration.
PN345
MR LATHAM: Yes.
PN346
MR JOSEPH: Yes, thank you. Yes, your Honour.
PN347
MR LATHAM: Well, sorry, private arbitration separate to the Act? Or - - -
PN348
THE COMMISSIONER: Well, the dispute resolution clauses in enterprise agreements are private arbitration clauses vested in jurisdiction by the parties in the Commission.
PN349
MR LATHAM: Yes.
PN350
THE COMMISSIONER: I want to know whether our examples, where the arbitration power derives from the Act and has resulted in the Commission awarding compensation.
PN351
MR LATHAM: I understand that essentially. No, I'll do what I can on that, your Honour.
PN352
THE COMMISSIONER: Yes, very good. We are adjourned.
ADJOURNED INDEFINITELY [3.47 PM]
LIST OF WITNESSES, EXHIBITS AND MFIs
EXHIBIT #R1 RESPONDENT'S SUBMISSIONS REGARDING JURISDICTIONAL OBJECTION DATED 14/08/2015....................................................................... PN128
EXHIBIT #R2 AFFIDAVIT OF JAMES ACKLAND..................................... PN129
EXHIBIT #A1 APPLICANT'S SUBMISSIONS REGARDING JURISDICTIONAL OBJECTION DATED 21/08/2015....................................................................... PN130
EXHIBIT #A2 STATEMENT OF TIMOTHY SCHELL................................. PN131
EXHIBIT #A3 STATEMENT OF NATHAN WOLLMAN............................. PN132
EXHIBIT #A4 STATEMENT OF SCOTT COLWELL.................................. PN133
EXHIBIT #A5 STATEMENT OF CHRIS COOTES....................................... PN134
EXHIBIT #R3 RESPONDENT'S SUBMISSIONS IN REPLY DATED 28/08/2015 PN135
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