| [2021] FWCFB 3456 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.604—Appeal of decision
“Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU)
v
Programmed Industrial Maintenance Pty Ltd
(C2020/8143)
DEPUTY PRESIDENT GOSTENCNIK |
MELBOURNE, 17 JUNE 2021 |
Appeal against decision [2020] FWC 5518 of Commissioner Yilmaz at Melbourne on 16 October 2020 in matter number C2020/2793.
[1] The Appellant, the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) applies for permission to appeal and if granted, appeals a decision of Commissioner Yilmaz (Decision) made on 16 October 2020. 1
[2] The Decision related to an application by the AMWU under s.739 of the Fair Work Act 2009 (Cth) (the Act) for the Commission to deal with a dispute in accordance with the dispute settlement procedure at clause 8 of the Programmed Industrial Maintenance Pty Ltd Metals Labour Hire Agreement 2020-2023 (the Agreement). 2
[3] The Agreement is expressed as binding on the following parties: Programmed Industrial Maintenance Pty Ltd (PIM); all employees of PIM engaged in the classifications contained at clause 10 of the Agreement and whose employment is, at any time when the Agreement is in operation, subject to the Agreement (Employees); and the AMWU. 3 The AMWU is noted in the decision approving the Agreement as being covered by it.4
[4] By the provisions of clause 3, the coverage of the Agreement is further defined by reference to Employees who are on-hired to clients of PIM and work under the direction of those clients, under the terms and conditions of the Agreement. This is expressed to mean “straight forward labour hire on an hourly basis for maintenance related tasks”, with included and excluded tasks being specified therein. The Agreement applies to such Employees within the metal and engineering industry who are engaged from or work in the Melbourne metropolitan area bound by a 50 kilometre radius (which may be extended by agreement) from the Melbourne GPO and includes Employees at the Lion Dairy in Morwell Victoria. 5
[5] The Agreement was approved on 28 February 2020. It commenced operating on 6 March 2020 and its nominal expiry date is 30 June 2023.
[6] The dispute related to clause 16 of the Agreement, which provides for a travel allowance to be paid where an Employee is required to attend work (excluding RDO) and starts and finishes work away from “the Company workshop or designated depot(s)”. Specifically, the dispute as expressed in the question for arbitration, concerned whether the expression “the Company workshop or designated depot (s)” should be read to include the place at which the Employees are ordinarily and regularly directed to commence work. 6
[7] Essentially, the AMWU contended that the travel allowance applies to all Employees under the Agreement in the normal course of attending for work because PIM does not own or lease its workshops or depots on client sites and therefore PIM Employees always start and finish work away.
[8] The Commissioner determined that the expression “Company workshop or designated depot(s)”, taking into account the PIM business model, the steps taken by PIM to identify travel allowance as a critical issue for negotiation in the current Agreement and the historical context, should be read to include the place at which the employee is ordinarily and regularly directed to commence work. This conclusion was responsive to the question framed by the parties for arbitration, namely: “In clause 16 of the Enterprise Agreement, should the expression ‘Company workshop or designated depot(s)’ be read to include the place at which the employee is ordinarily and regularly directed to commence work?” The Commissioner also determined that the workshops or depots managed by PIM at client sites are the workshops or depots referred to in clause 16 of the Agreement. 7
[9] The Decision commences with a summary of the dispute and then at [7] to [13] sets out the following uncontentious background facts:
• PIM is a provider of maintenance, shut down and project services to contract clients. It provides complete outsourced maintenance services to six clients in Victoria and is part of the Programmed group of companies which acquired Skilled Group Limited and a subsidiary business ATIVO in or around October 2015 (rebranded as “Programmed Industrial Maintenance Pty Ltd” whilst the rest of Skilled Group Limited was restructured and integrated into the Programmed group of companies);
• The Employees commence and finish their working day at one of the six client sites, of whom most have attended the same site to perform their work for many years including permanent and site casuals who primarily work at a single site (excluding casuals engaged on an ad hoc basis);
• PIM’s registered and corporate offices are, respectively, in Burswood, Perth, Western Australia and Collins Street, Melbourne, Victoria;
• PIM and its predecessor entities held the contracts for each of the six clients for no less than 15 years, with its outsourced maintenance contracts ordinarily being obtained for an initial three year period with options to extend;
• Historically the AMWU has engaged in enterprise agreement-making for “generally standard” terms and conditions with the Victorian metals labour hire industry; and
• In April 2020, PIM issued correspondence to Employees stating that it had decided to cease paying the travel allowance which it considered was not required to be paid (and had previously been paid as an “over award” condition) as part of its strategy to remain competitive.
[10] The respective cases for the AMWU and PIM are outlined at [14] to [32] of the Decision.
[11] An extract of the disputed term at clause 16 of the Agreement, and a summary of other terms going to the Agreement’s application, objectives and principles for flexibility/mobility of labour (at clauses 3, 7 and 11) are set out at [33] to [37], concluding with the Commissioner’s observation that the Agreement “is predicated on the basis that employees are located at client sites, there is no reference [in the Agreement] to PIM owned or leased workshops or depots”.
[12] The Commissioner’s consideration commences with a statement that the principles applicable to the interpretation of agreements are well established and applied to this dispute. 8
[13] The Decision notes at [41]-[42] that the Agreement does not define “Company workshop or designated depot” and that both parties have a different interpretation. The Commissioner finds that the disputed phrase in clause 16 is ambiguous:
“The Agreement contains no other provision that adds to the ambiguity of clause 16, or brings clarity to it.
While the parties submit that the ordinary application of travel allowance for industrial purposes is to compensate employees required to submit to the inconvenience of travel to workplaces not ordinarily required to attend, which I accept, this dispute concerns an Agreement and arrangements with historical and industrial context. The conditions concerning the application of the travel allowance is ambiguous because the clause in the Agreement allows for ambiguity of the terms Company workshop or designated depot(s) and its application over time”. 9
[14] Consideration is next given to the travel allowance provision in the incorporated Manufacturing and Associated Industries and Occupations Award 2010 (the Award). The Commissioner identified an inconsistency with the Agreement because the start and/or finish location is away from the usual workplace under the Award whereas under the Agreement the start and finish location is away from the Company workshop or designated depot(s). The Commissioner noted that the dispute concerned whether the assigned location (the usual place of work) is a Company workshop or designated depot. 10
[15] Next the Commissioner considered the decision in Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v All In One Contracting Pty Ltd (All In One) 11 also involving an interpretation of the phrase “the Company workshop or designated depot(s)” in a dispute about a travel allowance provision under another enterprise agreement. The Commissioner accepted the reasoning12 in All In One that:
“. . . a contractor may be allocated a workshop by a head contractor or project owner in a compound where the workshop is identifiably the contractor’s and over which it (the contractor) has exclusive use and control over for the duration of a project. This may give the workshop the character of a company workshop without their being a proprietary interest. Less important in my view is the presence of a proprietary interest than is the identity of the workshop, its geographical and operational distinctness and AIO’s exclusive use and control of the workshop that is independent of its client/s.
“… the term ‘the Company workshop’, the plain meaning of the phrase in my view is that the workshop is owned or leased by AIO and/or it is a workshop that is identifiably AIO’s and is operationally and geographically distinct from its clients. Further, AIO has exclusive use of and control over the workshop to the exclusion of its client/s and it would be characterised by the provision of normal facilities/amenities such as a crib room, toilets and shower facilities by AIO. Finally, use of the definite article ‘the’ narrows and directs the description of the workshop to a known and specific workshop, that being ‘the Company workshop’.
My view is fortified by the language used to describe ‘depot/s’ which is discussed below, where the prefacing verb ‘designated’ is used which would allow for different ‘depots’ to be established and designated depending on the volume and geographical spread of AIO’s work. That is not the case with respect to the term ‘the Company workshop’ where the verb ‘designated’ is not used. This supports a construction that ‘the Company workshop’ is a known and specific facility, not one that can be simply altered by way of ‘designation’ for the purpose of the travel allowance entitlement.” 13
[16] The Commissioner also noted at [50] of the Decision that in All In One the Deputy President recognised that more than one depot may be designated depending on the volume and geographical spread of the work and that the word depot in its ordinary and plain meaning denotes a building or room that stores goods, tools, equipment and the like.
[17] However, the Commissioner noted the Deputy President’s construction was undertaken in the context of the business conducted by All In One Contracting and there were substantial differences between that business and the one conducted by PIM. The Commissioner described the differences she found at [48] and [51]-[53] of the Decision.
[18] Relevantly the Commissioner found:
“… PIM has six client contracts where employees (with the exception being ad hoc casuals) start and finish their work at the one site and have done so for the duration since PIM acquired Skilled Group and for some employees the one location predates PIM’s acquisition of Skilled. PIM’s client contractual arrangements include arrangements for the use of and management of workshops or depots on client sites. 14 Mr Cooke gave evidence that it transitioned client contracts to a managed outsource maintenance model which involved PIM supervisory or management staff at each site, and it removed the account manager function. Evidence also included that the workshops were brand signed as PIM. Mr Austin, an employee located at the Boeing site could not recall signage, but admitted the workshop was the responsibility of PIM and the workshop has become a more permanent work location. Mr Austin provided copies of his payslips that identified and designated Boeing as his work site location.15 The evidence of Mr Guglielmini was contrary, and I accept the evidence of PIM.
PIM does not have any site offices, workshops, depots owned or leased in relation to the business operating under the Agreement. The only establishments owned or leased by PIM are the registered office located in Western Australia and corporate office located on Collins Street in Melbourne. Neither of these two sites have any connection to the language in the Agreement that would result in a different meaning of Company workshop or designated depot(s).
The arrangement with client sites is that each has a stand-alone workshop or depot with a dedicated space for the PIM manager, supervisor or team leader, PIM has exclusive possession and control and each location is branded with PIM signage.” 16
[19] These factual findings, which establish relevant context in which the disputed provision operates and is to be applied are not challenged in the notice of appeal but issue is taken with some aspects of these findings in the AMWU’s submission.
[20] Next the Commissioner deals with evidence about the negotiations for the Agreement, and of the historical practice of paying the travel allowance at [55] to [61] of the Decision and at [62] said:
“In my opinion there is no clear evidence that the parties had a common understanding that the payment of the travel allowance applied regardless of whether the employee regularly attended the same location. The evidence does not bear out a common understanding. The objective evidence is that the Agreement clause was available, was strongly negotiated, that the employees sought to maintain the clause as close to the 2016 Agreement as possible, that Mr Cooke informed employees at the Boeing and Bega sites (he relied on his site and operations managers to inform the remaining four sites) that PIM would consider ceasing the practice of paying the allowance, and what was also evidence was that the documentation supplied by PIM in the pre-approval phase, and in the December memorandum, was not clear that PIM would cease payment of the allowance where it is not payable under the clause.” 17
[21] A similar conclusion is reached as to the evidence about the explanation given to Employees voting to approve the Agreement. 18
[22] At [64] and [65] of the Decision the Commissioner reasoned:
“The travel allowance as provided in clause 16 is ordinarily paid consistent with common provisions where employees are disadvantaged by the requirement to travel away from their workplace. The clause identifies the Company workshop or depot, but as PIM has no workshop or depot owned or leased, therefore for the clause to apply there must be a distance point. The logical conclusion must be the workshop or the depot controlled or managed by PIM. Clauses that rely on a distance from the CBD, such words are ordinarily stated, this clause relies on the distance point being the workshop or depot and not the CBD. The clause further refers to conditions such as travel within a 35 km radius and reimbursement of toll charges by PIM. There was no evidence of any payments made other than the daily rate to demonstrate the utility of the clause. Each of the provisions in the clause raise the serious question how the clause is applied taking into account its ordinary meaning. These provisions in my view can only apply where the distance point is the Company workshop or depot(s), and as such brings logical and plain meaning to the clause.
The complication arises in clause 16 from the disputed expression Company workshop or designated depot(s). The relevant principles summarized by Golden Cockerel and Berri are that ‘surrounding circumstances will not be admitted that contradict the plain language of the agreement’ and ‘surrounding circumstances will be admissible to aide the interpretation of the agreement’. 19 Having considered the relevant principles and the findings in All In One Contracting, the admissible evidence concerns the PIM business model in the context of the Agreement as a whole which aids in the interpretation of the plain meaning of the disputed expression Company workshop or designated depot(s).”
[23] The last sentence in the above passage with its reference to an “interpretation of the plain meaning of the disputed expression” is at odds with an earlier finding at [44] that “the clause on the Agreement allows for ambiguity of the terms “Company workshop or designated depot(s)”.
[24] At [66] and [67] the Commissioner concludes:
“The question to be determined was:
In clause 16 of the Enterprise Agreement, should the expression ‘Company workshop or designated depot(s)’ be read to include the place at which the employee is ordinarily and regularly directed to commence work?
After having considered the expression Company workshop or designated depot(s), the PIM business model, the steps taken by PIM to identify travel allowance as a critical issue for negotiation in the current agreement and the historical context, the answer to the question is ‘yes’, and further the workshops or depots managed by PIM at client sites are the workshops or depots referred to in clause 16.”
Appeal grounds and summary of contentions
[25] Although containing three enumerated paragraphs alleging error, the way in which AMWU’s notice of appeal is framed suggests only two appeal grounds are advanced because the third ground suggests overall error by reason of the first two grounds.
[26] The first contends that the Commissioner erred:
“by giving an interpretation of the term ‘Company workshop or designated depot(s)’ (Term) that went impermissibly beyond a literal reading of the Term:
a. The Commissioner held at [44] that the Term was ambiguous; and
b. The Commissioner then gave an interpretation of the Term that aligned with the respondent’s business’s operations rather than an interpretation that fell reasonably within a literal meaning of the Term.”
[27] The second contends that to the extent that there was ambiguity in the Term, the Commissioner erred:
“by failing to give proper or appropriate weight to admissible evidence of the surrounding circumstances in the period before the Agreement was made:
a. The Commissioner failed to give proper or appropriate weight to the applicant’s/appellant’s, relevant employees’ and respondent’s conduct in applying provisions materially the same as the Term in earlier industrial agreements; and
b. The Commissioner failed to give proper or appropriate weight to the evidence of how the application of the Term was explained to the relevant employees by the respondent in the Agreement’s pre-approval process.”
[28] The third paragraph in the appeal grounds simply contends that the Commissioner’s construction of the disputed term was wrong by reason of the first two grounds. In fairness however, we take this to be a contention that the construction of the Agreement adopted by the Commissioner was incorrect simpliciter.
AMWU’s submissions
[29] The AMWU argues that it is in the public interest for the Commission to grant permission for the appeal because:
• The appeal allows for the Commission to correct a decision that is both wrong and arrived at by erroneous reasoning;
• The disputed term is materially the same as or similar to expressions used in numerous enterprise agreements, thus the Decision has implications beyond the immediate dispute;
• An analogue of the disputed term has been interpreted in a different way by a single member of the Commission in All In One, and another single member of the Commission has reserved a decision in an arbitration of a term that is materially similar to the disputed term; and
• A ruling by a Full Bench of the Commission on the interpretation of the disputed term may prevent future disputation over the application and interpretation of provisions that contain like terms to that presently in dispute.
[30] As to the first ground, the AMWU contends that there is no ambiguity in the disputed provision and the Commissioner’s interpretation is an “excessive departure from the Agreement’s terms”. The AMWU accepts that at least 60 (and up to 76) Employees were engaged by PIM under the Agreement, were deployed to dedicated client sites and did not “as a rule” move about but says the consequence was that the Commissioner had to decide whether the travel allowance term nonetheless generated an entitlement due to the Employees not being engaged at a Company workshop or designated depot(s). It does not assert error in the finding that PIM did not own or lease any workshops or depots at the Employees’ places of work (which was agreed in the proceedings below) but rather says the error arose by the Commissioner’s finding that there was a sufficient connection between workshops where the Employees were deployed and PIM. The AMWU argues that it was wrong to accept the testimony of PIM as to its “exclusive possession and control of the client’s on-site workshop” given that there was no production or exposition of the said contract; a conclusion that a contractual arrangement could amount to exclusive possession was not expounded upon; and the evidence in any event should not be accepted because it was vague, contradictory and unconvincing. The AMWU contends that the Commissioner misapplied the reasoning in All In One and erred in finding that the workshops marry into the travel allowance term because they are in PIM’s business model which it likened to bending and moulding the words in the travel allowance term as to fit a square peg into a round hole. 20
[31] The second ground of appeal is pressed in the alternative, proceeding on the basis that there is an ambiguity. Essentially, the AMWU argues that the Commissioner’s construction is a departure from a longstanding understanding of the disputed term’s meaning, an argument pressed by reference to the weight given to the historical context in PIM (and its predecessors) paying the travel allowance to Employees and the explanation provided to the Employees as part of the statutory pre-approval process before voting to approve the Agreement. The AMWU highlights parts of the evidence before the Commissioner about the explanation of the travel allowance provision in the Agreement and whether or not it would continue to be paid and acknowledges that subjective understanding or impression of the Employees is not determinative. It says additional relevant factors were that a group of labour hire employers who bargained as an industry group had negotiated a reduction in the travel allowance provision and that this development was relayed to PIM along with an explanation of the artificiality of the travel allowance payment being made regardless of any requirement to travel. The revised industry provision (a two-tier structure) was put to PIM Employees who voted against approving that proposed agreement. On a second vote, the PIM Employees ultimately voted to approve the Agreement with the travel allowance provision in “materially the same” form as the predecessor agreement. The AMWU said this evidence established that there was an attempt to change the travel allowance provision which was not agreed and so the parties reverted to the standard form provision with a long-standing and industry-wide application in labour hire consistent with the construction for which the AMWU contends. 21
PIM’s submissions
[32] PIM argued that permission to appeal is not warranted and should be denied. 22
[33] PIM submits that the first ground of appeal is misconceived. It says that to read the disputed term in the manner for which the AMWU contends would be to do so in a vacuum, devoid of context, known facts, logic and industrial purpose – contrary to the established principles in Golden Cockerel and Berri. 23 PIM argues there was no error in the Commissioner’s acceptance of the evidence of PIM’s arrangements with its clients as one important contextual matter and it is apparent from her reasoning that this was just one finding about the surrounding circumstances which contextualised the proper construction of clause 16. PIM contends that the ambiguity is “patent”.24
[34] As to the second ground of appeal, PIM argues that the Commission should not presume the words and intent from a similar pattern agreement bear a particular meaning and then require the parties to another agreement to establish otherwise. Rather, it said the Commission should concern itself only with the parties to the instant agreement and what, objectively, they intended by the words they agreed. It was submitted that the Commissioner was correct in distinguishing the All In One decision. Further, that although past conduct may serve as an aid to interpretation that is only one of many aids and cannot contradict the plain meaning of the words and the findings of objective fact in relation to explanations given to Employees were consistent with the evidence - which the AMWU now seeks to “mischaracterise” or to argue without support in the evidence that was before the Commissioner. 25
[35] PIM’s submissions contend there was no error as set out in the first two grounds and therefore there was no error in the conclusion reached.
[36] The approach of a Full Bench to the determination of an appeal depends on the nature of the decision below. In the present case, the Commissioner was resolving a dispute that involved the interpretation of an enterprise agreement. The Commissioner’s interpretive decision the subject of the appeal is not a discretionary decision. The Commissioner determined the dispute by construing the Agreement to determine the meaning of the disputed term and then applied factual findings made to resolve the underlying dispute which was concerned with whether the Employees had an entitlement to be paid the travel allowance for which clause 16 makes provision. If permission is granted, the task on appeal is to consider whether the Commissioner’s construction of the Agreement is correct. Error of the kind identified in House v The King 26 need not be shown for that purpose. However, the factual findings made might be shown to have been erroneously made in the House v The King sense - in that the findings made were mistaken such that, if the erroneous findings were material, we may review the determination and exercise our own discretion in substitution for that of the Commissioner if on the materials that would be permitted.
[37] Section 739(5) of the Act has the effect that the Commission is prohibited from making a decision which is inconsistent with the terms of an enterprise agreement (being a species of “fair work instrument”), properly construed. This means that, where an appellant raises a seriously arguable contention that a decision made pursuant to s 739(4) involves a misconstruction of the enterprise agreement to which the decision relates, it may be necessary to grant permission to appeal to ensure compliance with s 739(5).
[38] The construction of provisions of an enterprise agreement begins with a consideration of the ordinary meaning of the words, read in context, taking account of the evident purpose of the provisions or expressions being construed. Context may be found in the provisions of the agreement taken as a whole, or in their arrangement and place in the agreement. The statutory framework under which the agreement is made or in which it operates may also provide context, as might an antecedent instrument or instruments from which a particular provision or provisions might have been derived. The industrial context in which an agreement is made and operates is also relevant. Thus, the language of an agreement is to be understood in the light of its industrial context and purpose, not in a vacuum or divorced from industrial realities. But context is not itself an end and a consideration of the language contained in the text of the agreement being considered remains the starting point and the end point to the task of construction. A purposive approach to interpretation is appropriate, not a narrow or pedantic approach.27
[39] It is convenient to begin by setting out clause 16 of the Agreement in full:
16. TRAVEL ALLOWANCE
The following rates of travel allowance shall apply where an employee is required to attend work (excluding RDO) and starts and finishes work away from the Company workshop or designated depot (s), not using Company transport:
• $27.56 per day within a 35 kilometer radius.
• Therefore, 1.875 cents per kilometer car allowance to the site and return. Beyond this distance the provisions of the Award shall apply.
• Should an employee commence work at the designated site and then be required/requested to travel to an alternative site during work time and using their own vehicle, any toll charges (E-Tag) reasonably incurred will be reimbursed by the company upon presentation of invoice/receipt.
[40] As the Commissioner correctly identified, at the heart of this dispute is the meaning of the phrase “the Company workshop or designated depot (s)” which is the reference point from which an entitlement to payment of a “travel allowance” is determined. The term “the Company” is defined at clause 4 to mean “Programmed Industrial Maintenance Pty Ltd”. Other words in the disputed phrase are not defined in the Agreement itself and the phrase is not used elsewhere in the Agreement.
[41] By providing at clause 16 of the Agreement for a daily travel allowance with differently expressed reference points to that in the incorporated Award and expressly providing that it is only for travel beyond a 35 kilometre radius that the Award shall apply, there is a direct inconsistency between the express term of the Agreement and the Award incorporated term. Pursuant to clause 6.1 of the Agreement, the provision at clause 16 of the Agreement prevails to the extent of the inconsistency. It follows that the incorporated terms of the Award may not be read into clause 16 to supplement the drafting of the disputed term. Parts of the Award would however continue to apply to fill the gap identified in the second sentence of the second dot point of clause 16 of the Agreement. The Commissioner was thus correct in finding relevant ambiguity.
[42] Relevant context may be found in the Agreement when read as a whole. Specifically, the introductory provision at clause 3.1 of the Agreement contextualises that which is not in dispute – that this Agreement applies only to employees who work on-hire for clients of PIM, performing maintenance-related tasks, at client sites within a 50 kilometre radius of the Melbourne GPO and at the Lion Dairy in Morwell. The Agreement also includes various references to the work of Employees being performed at client-owned sites, for example: clause 12, providing that casual employees engaged at “a specific client site” for a continuous period of 6 months will be converted to full time employment; clause 26, providing that induction will be specific to a client’s site; and clause 34, providing for relativity with the normal client rate of pay where PIM provides supplementary labour “at a client site”. Clause 11, titled “Flexibility/Mobility of Labour”, contemplates that in the course of a three-month period Employees could work at up to twenty different workplaces and Employees’ work practices and start and finish times may differ as required by the clients. From these provisions it is clear the Agreement only operates upon Employees who are on-hired to work for a client of PIM, at client sites that are not owned or operated by PIM. It was common ground before the Commissioner that PIM as a labour hire provider does not own or lease any workshops or depots either at any of the six client sites where its Employees start and finish work performed under the Agreement or elsewhere and most Employees do not move around in the manner contemplated at clause 11 but rather have tended to be based at the same client site for many years. 28
[43] Before returning to the proper construction of the disputed phrase, we will deal with the appeal grounds as framed in the notice of appeal.
Appeal ground one
[44] It is from the earlier mentioned uncontroversial factual context that the two competing constructions arise: the AMWU arguing that the travel allowance is payable to all Employees wheresoever they start and finish work, because PIM does not own the workshops or depots; and PIM arguing that the travel allowance is only payable to Employees who it requires to start and finish work away from the place where they ordinarily and regularly work (a place that is not owned or leased by, but within PIM’s possession or control). Although PIM’s contention is framed by reference to the agreed question that required determination, the substance of its contention is that the disputed phrase must mean the workshop or depot at a client’s premises managed or controlled by PIM. 29 Whilst the mere existence of rival contentions as to the proper construction of the terms of an enterprise agreement is not a sufficient basis to conclude that there is ambiguity, regard may be had to the surrounding circumstances to assist in determining whether an ambiguity exists. It would appear to us unnecessary to look further at the surrounding circumstances in order to identify an ambiguity in this case. Against the context of these objective facts, the disputed provision is plainly susceptible of more than one interpretation. Ambiguity arises from the use in clause 16 of the undefined phrase “the Company workshop or designated depot(s)”. The decision on which the AMWU rely – All In One – also found, and we think correctly found, that there was ambiguity in the phrase.30 Before the Commissioner, the AMWU advanced the following construction of the disputed phrase. First it said that “the Company workshop” meant a workshop owned or leased by PIM.31 Second, it contended that the word “Company” applied as a limitation to both the workshop and any designated depot.32 Third, and contrary to that which it now put on appeal, the AMWU said that the word “designated” was ambiguous.33 Fourth, absent any agreement with a particular Employee to the contrary, the AMWU said that PIM was able to designate a depot or depots, provided the depot was a depot properly described.34 Fifth, the AMWU contended that a “depot” in the context of the Agreement was a storehouse where PIM keeps tools, materials, consumables, vehicles etc.35
[45] Thus, on the AMWU’s construction, the disputed phrase means “the Company owned or leased workshop or the Company owned, leased or designated (usually determined by the Company) depot(s) (which is a storehouse at which the Company keeps tools, materials, consumables, vehicles etc)”.
[46] The AMWU properly accepted below that the word “designated” is ambiguous. But so too is the remainder of the phrase. What is meant by “the Company workshop” is plainly ambiguous. Although no apostrophe “s” is attached to the noun “Company” there can be little doubt it is used as a possessive noun signifying some form of possession of the workshop. It may have the limited meaning ascribed to it by the AMWU, but it may be broader, for example, a workshop which is neither owned nor leased by the Company, but one over which it has control, or is entitled to use or is entitled to call or describe a workshop as the Company workshop. Similarly, the phrase “designated depot(s)” is ambiguous. It may have the meaning for which the AMWU contends, but it may be broader. Accepting for a moment that in the context of the Agreement a “depot” means a place for the storage of equipment etc, it need not be confined to a “storehouse”. It may be a place at one or more of PIM’s clients’ premises at which PIM is permitted or entitled to store equipment etc.
[47] Therefore, to the extent the AMWU contends the Commissioner erroneously concluded that the travel allowance term containing the disputed phrase was ambiguous, the first appeal ground must fail.
[48] The second part of the first appeal ground contends that the Commissioner erred in interpreting the disputed phrase by reference to PIM’s business operations rather than finding a meaning which fell reasonably within the literal meaning of clause 16 of the Agreement. We do not accept that this is correct. If one is to accept the AMWU’s construction of the disputed phrase, then considering the undisputed fact that PIM does not own or lease any workshops or depots either at any of the six client sites where its Employees start and finish work performed under the Agreement or elsewhere, much of clause 16 would never have any application. This is because entitlement would depend entirely on starting and finishing away from a place which is non-existent. This, on the AMWU’s case, is the literal meaning and effect of clause 16. A construction that renders nugatory a provision of an enterprise agreement should be avoided. There is no basis for suggesting, as is inherent in the AWMU’s contention, that a meaning which fell reasonably within the literal meaning of clause 16 of the Agreement is that absent a company owned or leased workshop or designated depot, all Employees become entitled to a travel allowance. This would require a re-writing of the provision and to give it an effect travelling well beyond its evident operation as disclosed by the text. The entitlement to a travel allowance is contingent on the existence of a particular state of affairs. Absent that state of affairs no entitlement can arise because the precondition has not been met.
[49] In order to give operative meaning to the provision, the Commissioner was entitled to consider the context in which the Agreement operated, including the nature and organisation of PIM’s business in which the Employees performed work and were employed. This is part of the industrial context in which the Agreement and the disputed term is to be understood 36 and part of the industrial reality in which the Agreement operates, remembering that enterprise agreements are made in light of the prevailing customs and working conditions.37 We are therefore not persuaded that the second part of the first ground of appeal is made out.
[50] If follows that the first appeal ground fails.
Appeal ground two
[51] By this appeal ground the AMWU contends the Commissioner fell into error by failing to give “proper or appropriate weight” to admissible evidence of the surrounding circumstances in the period before the Agreement was made. Two categories of evidence are identified. First, it is said that the Commissioner failed to give proper and appropriate weight to evidence about PIM’s conduct in applying relevantly the same allowance term in earlier industrial agreements. Second, it is said that the Commissioner failed to give proper and appropriate weight to the evidence about how the application of the disputed term was explained to relevant Employees in the Agreement’s preapproval process.
[52] The first thing that must be said about this appeal ground is that the AMWU does not allege any error of primary fact-finding. Rather it contends a failure to give proper or appropriate weight to particular evidence. A contention that appropriate weight has not been given to one or more evidentiary matters is not a proper contention of appealable error. Rather it is no more than a complaint that the Commissioner did not make the evaluative assessment which the AMWU would have preferred. Thus, unless it can be shown that the Commissioner failed to give weight to relevant considerations to such a degree that her exercise of a discretion miscarried, the errors alleged in substance, amount to little more than an invitation we re-evaluate the evidence by giving it different, and presumably greater, weight.
[53] As to the first category, the Commissioner found at [55] of the Decision that it was relevant that PIM paid the travel allowance under the predecessor agreement because it continued the practice adopted by the business operated by “Skilled” (which PIM had acquired during the operation of the predecessor agreement). No challenge is made to this finding. Indeed, during the hearing of the appeal, the AMWU accepted that PIM took the view that there was no obligation to pay travel allowance under the predecessor agreement. 38 In that context it would appear the Commissioner gave PIM’s conduct under the predecessor agreement little weight. We do not consider that weight ascribed by the Commissioner was so inadequate as to rise to the level of showing appealable error.
[54] As to the second category, the Commissioner deals with a memorandum circulated to Employees as part of the pre-approval process for the Agreement at [57]-[58] of the Decision. Therein the Commissioner finds that the language of the memorandum concerning the continuation of a travel allowance payment under the proposed agreement was not clear. The Commissioner also finds that despite the potential uncertainty of the memorandum, relevant Employees were aware throughout the negotiations for the Agreement that PIM maintained there would be no travel allowance entitlement unless the conditions in clause 16 were met. Neither of these findings is challenged. The Commissioner concluded that there was “no clear evidence that the parties had a common understanding that the payment of the travel allowance applied regardless of whether the employee regularly attended the same location . . . [and] [T]he evidence does not bear out a common understanding”. 39 No challenge is made to this finding. In light of the Commissioner’s unchallenged findings the weight she ascribed to this evidence is not only understandable but correct and so no appealable error is made out.
[55] It follows from the above that appeal ground two fails.
Appeal ground three
[56] Although appeal ground three is expressed as relying on the errors alleged in appeal grounds one and two, in truth, it contends the Commissioner’s construction of the disputed term was incorrect. We return therefore to the proper construction of the term.
[57] Apart from the context provided by other parts of the Agreement to which we have earlier referred, the relevant context in which the Agreement was made and operated is also important. It is uncontroversial that when the Agreement was made each relevant Employee commences and finishes their work at a PIM client manufacturing site, and that most of these Employees have attended the same place of work for several years. As we have already noted, it is also uncontroversial that at the time the Agreement was made PIM did not (nor does it now) own or lease any workshops or depots at any of its client sites where its Employees start and finish work performed under the Agreement or elsewhere.
[58] As adopting the construction of the disputed term for which the AMWU contends would render nugatory the provision, in order to give meaning and effect to clause 16 of the Agreement, the construction task requires finding meaning in the phrase “the Company workshop or designated depot(s)” in a clause prescribing a travel allowance which is payable to Employees who are required to attend work and start and finish away from that point. Having regard to the contextual matters to which we have referred we consider that the meaning of the phrase “the Company workshop or designated depot(s)”, includes a company owned or leased workshop or designated depot but is not limited to these. The context allows for the phrase to also include a workshop or depot at a client’s premises in relation to which PIM is given control or management or is otherwise permitted to use as a workshop or depot. It is to be accepted that “the Company workshop or designated depot(s)” requires a link between the Company and the workshop or depot and this must necessarily be identifiable so the parties know the reference point from which the travel allowance is to be calculated and enforced as a term of the Agreement. However, there is no reason to read the phrase “the Company workshop or designated depot(s)” as being confined to a place over which PIM has a proprietorial interest. The phrase is broad enough to encompass the types of rights – control, management or right of use - to which we have referred. Such a construction is consistent with the text of the provision read in the context of the Agreement as a whole. It avoids the consequence for the operation of the clause that would ensue by reading the phrase more narrowly and does not result in doing violence to the language of clause 16 which would necessarily result by adopting the AMWU’s broad-brush entitlement contention.
[59] It must next be determined whether there are any Company workshops or designated depot(s) within the meaning of clause 16 at any of PIM clients’ establishments at which the Employees work.
[60] Mr Benjamin Cooke (PIM’s General Manager VIC/TAS/SA) gave evidence below that:
• PIM adopted a different approach to managing and servicing the six clients following its acquisition of Skilled. Where Skilled had treated these clients as labour hire clients managed by an Account Manager from a local branch, PIM transitioned the management of those clients to a “managed outsourced maintenance model” and embedded PIM’s supervisory or management at each site. 40
• At each of the six client sites, there is a “workshop, a store and a dedicated office space for PIM’s manager, supervisor or team leader (as applicable)” and “the store is a dedicated area for PIM to store spare parts, uniforms and equipment”. 41
• PIM’s contractual arrangements with each client give PIM exclusive possession and control of the client’s on-site workshop. The workshops contain PIM documentation, each office is branded with PIM signage and is supplied with PIM laptops and PIM stationery. 42
• All Employees at each site are assigned a locker or mobile tool chest in which to store their personal effects. 43
• Since the acquisition, Employees remained working at their previously assigned site. Employees who have joined since then have been issued with a PIM contract that designates the relevant client site where they are required to attend for work each day. 44
• In case of any confusion, PIM issued a letter to each Employee (other than to ad hoc casuals) in May 2020 that confirmed the location of their “regular workplace” and an explanation of PIM’s view that the Company workshop or designated depot is their regular workplace for the purposes of clause 16 of the Agreement. 45
[61] In cross examination, Mr Cooke was questioned about the Nestle site and said: “So PIM have exclusive control of the workshop there and Nestle insourced some maintenance which then had Nestle mechanical people allocated a certain area of that workshop”. Mr Cooke also explained that although direct employees of PIM’s clients might also access these areas PIM’s permission was required because it was fundamentally responsible for those areas. 46 Mr Cooke was also unwavering in his evidence that PIM has signage for its workshops or offices on client sites. He further clarified the signage will have the PIM company name, it will have the manager in charge and the safety advisor as well.47
[62] Mr Norman Austin (PIM Employee at the Boeing site) gave evidence that over the course of his employment with PIM and its predecessor entities, since 1989, he had worked at about one hundred different sites, most recently and for five years at the Boeing site in Port Melbourne. 48 He said that there is no PIM depot or workshop at Boeing’s Port Melbourne site.49 Under cross examination he clarified his understanding that there is a mechanical workshop; and further clarified, “It’s Boeing’s workshop but they allow us to use it”, that PIM are responsible for this area and “there could well be” PIM signage but he had never noticed it.50 Mr Austin also confirmed he has not been asked to report for or attend work at a workshop or depot other than that at the client site.51
[63] Mr Guglielmini (PIM Employee at the Nestle site) was not cross-examined but prepared a written witness statement which said that for the duration of his employment with PIM and its predecessor entities, since about 1997, he had been employed at Nestle’s Campbellfield site. In his statement, he described that the site has a small workshop with some machine tools and work benches and a tool store which are run by Nestle and further said he had “a vague idea” of a Skilled/PIM workshop but had never gone there. 52
[64] As to this evidence (which as is evident from [51]-[53] of the Decision the Commissioner accepted), the AMWU contends (although not in any appeal ground) that the evidence ought not have been accepted because it was “unsupported testimony” without production or exposition of any contract. 53 The evidence above, particularly as it concerns the nature of any workshop or depot used by PIM at the various premises of clients, was given under oath and was subject to cross-examination. The AMWU did not make any application for the contract to be produced. The AMWU was served with PIM’s witness statements well before the hearing and so was on notice that evidence about a contractual right would be given. There is no reason why the evidence about arrangements at each workplace vis-à-vis use by PIM of a workshop or depot should not be accepted. Indeed, evidence given by Employees tends to confirm rather than detract from the evidence given by PIM’s witnesses. We are therefore comfortably satisfied that the arrangements in each of the six workplaces as described in the evidence fall within the meaning of the phrase “the Company workshop or designated depot(s)” in clause 16 of the Agreement. After answering the question posed, that which we have just described is the essence to the Commissioner’s further conclusion at [67] of the Decision. The third appeal ground therefore fails.
[65] It follows that as relevant Employees covered by the Agreement start and finish work at a location at which there is “the Company workshop or designated depot(s)” within the meaning of clause 16, this is not a place which is “away from the Company workshop or designated depot(s)”. Consequently, no entitlement to a travel allowance to and from that location arises.
[66] We return to the question of whether the Commissioner correctly answered the question posed by the parties. Strictly speaking the answer to the question must be “no”. This is because there is no basis to read into the disputed phrase the additional words suggested by the question. The phrase is to be construed in the manner we have outlined earlier. Ultimately, if the place at which an Employee is ordinarily and regularly directed to commence work is not a place which is away from “the Company workshop or designated depot(s)” no entitlement to an allowance arises. That is the present case. But if such a place is away from “the Company workshop or designated depot(s)” the entitlement to the allowance is engaged. That the Employee is ordinarily and regularly directed to commence work at that place is beside the point.
[67] However, that the question posed was incorrectly answered is not enough in the present circumstances to result in upholding the appeal. This is because, as is evident from [67] of the Decision, the Commissioner also concluded that “the workshops or depots managed by PIM at client sites are the workshops or depots referred to in clause 16”. For the reasons already given, this conclusion was correct.
[68] Accordingly, we consider that permission to appeal should be granted because of the erroneous answer given to the question posed, however, for the reasons given, because the second and ultimate conclusion was correct, the appeal should be dismissed.
[69] We order that:
1. Permission to appeal is granted; and
2. The appeal is dismissed.
DEPUTY PRESIDENT
Appearances:
B Terzic of the AMWU for the Appellant
J Forbes of Counsel for the Respondent
Hearing details:
2021
Melbourne (via video link)
28 January
Written submissions:
Appellant, 14 December 2020
Respondent, 14 January 2021
Printed by authority of the Commonwealth Government Printer
<PR730760>
2 AE507274
3 Agreement at clause 4, see also the Decision at [6]
4 Programmed Industrial Maintenance Pty Ltd [2020] FWCA 1105 at [6]
5 Agreement at clause 3.1
6 Appeal Book at p.91
7 [2020] FWC 5518 at [67]
8 Ibid at [38]
9 Ibid at [43]-[44]
10 Ibid at [46] and [47]
12 [2020] FWC 5518 at [49]
13 Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v All In One Contracting Pty Ltd [2020] FWC 2530 at [56]-[58]
14 Citing the Transcript recording at 1.20.
15 Citing the Transcript recording at 11.07, 13.00, 15.23 and 25.01.
16 Citing Exhibit R1 at [2]-[31]
17 Ibid at [62]
18 Ibid at [63]
19 Citing AMWU v Berri Pty Limited [2017] FWCFB 3005 (Berri) at [38]
20 Appellant’s Outline of Submissions at [12]-[19]
21 Appellant’s Outline of Submissions at [20]-[40]
22 Respondent’s Outline of Submissions at[16]-[24]
23 AMIEU v Golden Cockerel Pty Ltd [2014] FWCFB 7447 (Golden Cockerel) at [19]-[41]; Berri at [114]
24 Respondent’s Outline of Submissions at [40]-[51]
25 Respondent’s Outline of Submissions at [52]-[76]
26 [1936] 55 CLR 499 at [505].
27 See WorkPac Pty Ltd v Skene [2018] FCAFC 131 at [197] and the authorities referred to therein; see also King v Melbourne Vicentre Swimming Club Inc [2020] FCA 1173 at [122]-[130] and the authorities referred to therein.
28 Appeal Book at p.162
29 Appeal Book at p.193 at [54]-[55]
30 Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v All In One Contracting Pty Ltd [2020] FWC 2530 at [37]-[38]
31 Appeal Book at p.98 at [21]
32 Ibid at [22]
33 Ibid at [23]
34 Ibid at [24]
35 Ibid
36 Amcor Limited v Construction, Forestry, Mining and Energy Union [2005] HCA 10; (2005) 222 CLR 241 at [2]
37 City of Wanneroo v Holmes [1989] FCA 369; (1989) 30 IR 362 at 378-379
38 Transcript PN41-PN44
39 [2020] FWC 5518 at [62]
40 Appeal Book at p.211
41 Appeal Book at p.213
42 Ibid
43 Appeal Book at p.214
44 Ibid
45 Appeal Book at p.226
46 Appeal Book at p.53
47 Appeal Book at p.54
48 Appeal Book at pp.151 and 152
49 Appeal Book at p.153
50 Appeal Book at p.30 (Transcript at PN113, 117)
51 Appeal Book at p.32
52 Appeal Book at pp.182 and 183
53 Appellant’s Outline of Submissions at [17] – [18]