1
Fair Work Act 2009
s.739—Dispute resolution
Transport Workers’ Union of Australia
v
Q Catering Limited
(C2014/4714)
Qantas Airways Limited and Q Catering Limited - Transport Workers
Workplace Determination 2012
[AG895843]
COMMISSIONER HAMPTON ADELAIDE, 21 OCTOBER 2014
Dispute about application of a Workplace Determination - whether prior service as a casual
counts as service for the purposes of redundancy - approach to interpretation considered -
decisions in other instruments considered but determined on their own facts - overall context
and provisions of the Workplace Determination more consistent with prior casual service not
being counted for present purposes - dispute determined.
1. The nature of the dispute and the application before the Commission
[1] This matter concerns a dispute about the application of the Qantas Airways Limited
and Q Catering Limited - Transport Workers Workplace Determination 2012 (the Workplace
Determination). The dispute is essentially whether full-time (or part-time) employees, who
have previously had a period of employment as a casual employee, are entitled to have that
service included for the purpose of calculating compulsory redundancy entitlements under the
terms of the Workplace Determination.
[2] The Workplace Determination was made by a Full Bench of the Commission1 under
s.266 of the Fair Work Act 2009 in August 2012. The background to its making is set out in
the decision of the Full Bench issued at that time.2
[3] The Transport Workers’ Union of Australia (TWU) is covered by the Workplace
Determination and has made application for the Commission to deal with this dispute under
s.739 of the Act. The dispute is focused upon the circumstances of particular employees that
have been made redundant at the Adelaide operations of Q Catering Limited, which is also
covered by Workplace Determination. However, by implication, the dispute concerns the
operation of the Workplace Determination more generally, at least as it might apply in
circumstances similar to those at the Adelaide operations.
[2014] FWC 6160
DECISION
E AUSTRALIA FairWork Commission
[2014] FWC 6160
2
[4] In the lead up to the redundancies, Q Catering provided calculations of the estimated
redundancy payments under the relevant compulsory redundancy provisions of the Workplace
Determination. When some of the employees were made redundant, there was a discrepancy
between the estimates and the actual payments. It was subsequently revealed that in some
cases, a period of prior casual service had been included in the calculation of the estimates
and not reflected in the actual payments.
[5] Clause 12 Procedures for the Settlement of Industrial Disputes of the Workplace
Determination establishes a process culminating in disputes arising under the determination
being referred to the Commission. It is common ground that this process has been followed
and that the Commission has the jurisdiction to determine the dispute in accordance with
clause 12 and s.739 of the Act.
2. The terms of the Workplace Determination
[6] The resolution of this dispute involves the consideration of the Workplace
Determination as a whole. However particular provisions are relied upon by both parties and
these are all apposite.
[7] The provisions applying to compulsory redundancies are established in Appendix A -
Compulsory Redundancy. The full extent of that appendix is attached to this decision for ease
of reference.
[8] Appendix A does not expressly state the scope of employees to be covered by the
provision. However, it is agreed that it does not apply to casual employees in the sense that
such employees do not have an entitlement upon being made redundant.3
[9] For present purposes, the operative parts of Appendix A are as set out below.
“Redundancy payments
For redundancy under the terms of this Workplace Determination, the following
package shall apply:
Three (3) weeks’ pay for each year of service up to and including five (5) year’s
service, with a minimum of four (4) weeks’ pay.
Four (4) weeks‘ pay for each completed year of service in excess of five (5) years;
and
Pro-rata payment for each completed month of service.
The above-mentioned payments do not include payments in lieu of notice.
Pay calculation
For the purposes of this Workplace Determination, ―pay shall be paid at the ordinary
time rate prescribed in this Workplace Determination and shall include regular weekly
payments, such as service increments and supervisory allowances, but shall exclude
shift, overtime and extraneous payments.
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Notice period
An employee will be given the following period of notice of termination on the
grounds of redundancy instead of the period of notice prescribed by Clause 16 –
Termination of Employment.
Completed years of service Notice in weeks
Up to and including 4 years 4
5-9 years 8
10 years and above 12
Provided that an employee who is over 45 years of age will receive no less than 5
weeks notice.
Maximum redundancy payment
Any redundancy payments for full time employees who convert to part-time will
continue to be calculated on full-time equivalent salary with the period of service
being adjusted to reflect the hours actually worked.
Maximum redundancy payment
Part 1: This component shall only be available to employees who commenced their
employment on or prior to 16 October 1996:
The then value of an employee‘s accumulated redundancy payments as at 16
October 1996 shall be frozen in money terms and increased by 2% per annum for
each year of service after 16 October 1996. To this amount shall be added any
redundancy payments that accrue under the new redundancy scheme (see Part 2)
for service from 16 October 1996. An employee‘s actual date of commencement of
service will be used to calculate any redundancy payments under Part 2 (that is, for
the purpose of determining whether 3 weeks or 4 weeks pay per year of service
applies pursuant to the redundancy payments prescribed above for the calculation
under Part 2).
Part 2: Applies to Employees engaged after 16 October 1996 and to service after 16
October 1996 for employees engaged on or prior to 16 October 1996:
The new redundancy scheme shall apply to all employees. The maximum benefit
for redundancy pay under the new redundancy scheme shall be ninety-five (95)
weeks pay exclusive of notice periods.
Other entitlements
A. Annual Leave Loading
Accrued annual leave credits, including pro-rata leave due at the date of termination,
will be paid at the greater of the annual leave loading (17.5%) or the projected shift
penalties pertaining to the individual.
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B. Long service leave
Pro-rata long service leave shall be paid to employees with more than twelve (12)
months’ continuous service. For the purpose of these provisions, long service leave
will be applied in accordance with the amount provided under the Company’s long
service leave provisions.
C. Superannuation
Superannuation payments will be as per Company plan rules, plus full vesting of the
Company’s contributions with interest where not already applicable.
D. Preservation
It will be necessary to comply with the government’s regulations in respect of the
preservation of superannuation benefits.
E. Employee Travel
See staff travel policy manual.
F. Redeployment
To other duties. Where an employee has been redeployed to a lower paid position,
the employee shall be given four (4) weeks‘ notice of transfer and receive salary
maintenance (being the difference between the former ordinary time rate and the
new lower rate) for a period of six months following the transfer.
To other ports. Where the Company offers and the employee accepts redeployment
requiring a change of domicile, e.g. Sydney to Perth, Cairns to Brisbane, the
employee shall be entitled to normal transfer costs in accordance with Company
policy.
G. Company Certificate of Service
A statement of service will be issued to each redundant employee, indicating the
employee‘s length of service and that he/she was retrenched from the airline. This
certificate can be collected from the Company on the employee‘s last day of
employment.”
[10] The history of Appendix A is that a provision in similar terms had been included in a
series of enterprise bargaining agreements approved or certified by the Commission and its
predecessors. The Full Bench in making the Workplace Determination was not required to
arbitrate the terms of the Appendix and it was inserted largely in the same terms as the
Certified Agreement applying to these parties at the time.
[11] Previous versions of Appendix A have largely contained the same operative
provisions; albeit that in 2002, the relevant instrument4 expressly provided that the provision
did not apply to “casual employees, or employees engaged by the hour”. Subsequent
agreements have not contained an equivalent provision however there is no evidence to
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suggest that the application or implementation of the provision changed in that regard. There
have also been changes to the level of the benefits over time, however the framework of
entitlements has not changed so as to bear upon the resolution of the particular issue arising in
this dispute.
[12] The provisions in relation to casual employment are set out in clause 15.8 of the
Workplace Determination in the following terms.
“15.8 Casual Employment
15.8.1 Circumstances under which Casuals may be engaged
The future use of casual employment is primarily to meet unplanned or peak
workloads to maintain the efficiency of the Company's operations. Casuals
may be employed as per all relevant provisions of the Workplace
Determination and to cover peak and unplanned workloads.
15.8.2 Definition - A casual employee is an employee engaged as such.
15.8.3 Minimum hours and rates of pay
(a) Except as provided in 15.8.3(b), casual employees must be employed
for a minimum of 7 hours 36 minutes per day. Casual employees must be paid
a minimum amount per day of 1/5 of the weekly wage applicable to the
classification in which they are employed plus 15 per cent.
(b) Casual employees employed in Western Australia, Mount Isa, Alice
Springs, Yulara, Groote Eylandt and Adelaide must be employed for a
minimum of four hours per day. These casual employees must be paid an
hourly rate of 1/38 of the weekly wage of the classification in which they are
employed plus 25 percent.
(c) Any casual employee who is required to work more than 7 hours 36
minutes in any day must be paid in accordance with the overtime provisions in
this Workplace Determination.”
3. The position advanced by the TWU
[13] Mr Laurie, who appeared for the TWU, contends that all years of service count for the
purposes of calculating service under Appendix A. That is, full-time and part-time employees
upon being made redundant are entitled to have any casual years of service included.
[14] The TWU’s relies upon the following propositions:
Appendix A refers only to “completed years of service” and not to “continuous
years of service” and there is no apparent distinction drawn between casual and
other forms of service;
There is no express exclusion of casual service;
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In the absence of a definition of service, it should be given its normal construction
and applied to any contiguous or reasonably contiguous employment;
There was nothing to suggest that Q Catering had not previously recognised casual
service for redundancy purposes; and
The estimates provided prior to the redundancies being confirmed had included
casual service.
[15] The TWU also contends that casual employees in the Adelaide operation were
engaged on a regular and systematic basis and were not treated as “traditional” casuals.
Further, the Workplace Determination does not specify the basis for the additional 25% pay
for casuals and in any event this payment was insufficient to compensate for the loss of access
to redundancy given the significant maximum redundancy payments provided in Appendix A.
[16] Given the nature of the casual service here, the TWU contends that the approach
adopted in s.384 of the Act, to recognise such service for the purposes of unfair dismissal
matters, was a useful insight. In addition, the TWU contends that the casual service would not
be excluded for the purposes of s.22 of the Act.
[17] The TWU also contends that the case law reinforces that it is the particular
circumstances of each instrument that must be considered and where prior casual service was
not counted, this was due to express exclusions. In that light, the TWU further contends that if
the Workplace Determination intended to exclude casual service for present purposes, the
parties would have made this express intention clear.
[18] Finally, the TWU contends that “service”, for the purposes of Appendix A, should
simply mean “the action of helping or doing work for someone”.5
[19] The TWU relied upon the evidence of Ms Brydie Maynard and Mr Sheridan Smith,
who were each employed by Q Catering initially as casuals, and subsequently, full-time
employees, before being made redundant.
4. The position advanced by Q Catering
[20] Mr Colgrave, who appeared with permission for Q Catering, contends that prior casual
service does not form part of an employee’s service for present purposes and the employer
was not required to include that service in calculating redundancy payments.
[21] The position of Q Catering was based upon the following approach:
The pay calculation in Appendix A referred only to ordinary time rates and regular
weekly payments and this was not consistent with the parties contemplating
payments for casual service;
There should be no distinction drawn between service and continuous service;
The ordinary meaning of continuous service excludes periods of casual
employment and such employment was characterised by a series of contracts which
would not normally be considered to be continuous; and
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Casual employees are not entitled to severance pay under Appendix A or under any
of the earlier instruments applying to the parties.
[22] Q Catering also contends that the 25% additional payment should be considered to be
a casual loading and that such a loading was intended to compensate for the fact that casuals
are not entitled to redundancy pay. In that light, it argued that the inclusion of casual service
for redundancy purposes would represent double dipping.
[23] Further, Q Catering contends that there was no custom and practice of recognising
casual service for present purposes.
[24] In terms of the case law, Q Catering contends that this reinforces that casual loadings
compensate for non access to redundancy benefits and that casual service was not counted for
the purposes of redundancy payments unless the relevant instrument expressly stated so.
[25] Q Catering also rejected the notion that s.384 or s.22 of the Act were relevant here, or
of assistance to the TWU, if considered.
[26] Q Catering relied upon the evidence of Ms Sharon Marendaz, its Consultant, Human
Resources.
5. The correct approach to the construction of a Workplace
Determination
[27] In AMWU v Silcar [2011] FWAFB 2555, a Full Bench summarised the approach to be
adopted to the interpretation of an Enterprise Agreement in the following way:
“[9] In an oft-cited passage from Kucks v CSR Limited Madgwick J held:
“It is trite that narrow or pedantic approaches to the interpretation of an award
are misplaced. The search is for the meaning intended by the framer(s) of the
document, bearing in mind that such framer(s) were likely of a practical bent of
mind: they may well have been more concerned with expressing an intention in
ways likely to have been understood in the context of the relevant industry and
industrial relations environment than with legal niceties or jargon. Thus, for
example, it is justifiable to read the award to give effect to its evident purposes,
having regard to such context, despite mere inconsistencies or infelicities of
expression which might tend to some other reading. And meanings which
avoid inconvenience or injustice may reasonably be strained for. For reasons
such as these, expressions which have been held in the case of other
instruments to have been used to mean particular things may sensibly and
properly be held to mean something else in the document at hand.
But the task remains one of interpreting a document produced by another or
others. A court is not free to give effect to some anteriorly derived notion of
what would be fair or just, regardless of what has been written into the award.
Deciding what an existing award means is a process quite different from
deciding, as an arbitral body does, what might fairly be put into an award. So,
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for example, ordinary or well-understood words are in general to be accorded
their ordinary or usual meaning.”
[10] In Short v FW Hercus Pty Ltd Burchett J, with whom Drummond J agreed, held
that regard may be had to the history of a provision:
“No one doubts you must read any expression in its context. And if, for
example, an expression was first created by a particularly respected draftsman
for the purpose of stating the substance of a suggested term of an award, was
then adopted in a number of subsequent clauses of awards dealing with the
same general subject, and finally was adopted as a clause dealing with that
same general subject in the award to be construed, the circumstances of the
origin and use of the clause are plainly relevant to an understanding of what is
likely to have been intended by its use. It is in those circumstances that the
author of the award has inserted this particular clause into it, and they may
fairly be regarded as having shaped his decision to do so. The rules of
construction, Mason and Wilson JJ. said in Cooper Brookes (Wollongong)
Proprietary Limited v. The Commissioner of Taxation of the Commonwealth of
Australia (1981) 147 CLR 297 at 320, are really rules of common sense.
Common sense would be much offended by a refusal to look at the facts I have
summarized. As Isaacs J. said in Australian Agricultural Company v.
Federated Engine-Drivers and Firemen’s Association of Australasia (1913) 17
CLR 261 at 272, citing Lord Halsbury L.C.: “The time when, and the
circumstances under which, an instrument is made, supply the best and surest
mode of expounding it.”
The context of an expression may thus be much more than the words that are
its immediate neighbours. Context may extend to the entire document of which
it is a part, or to other documents with which there is an association. Context
may also include, in some cases, ideas that gave rise to an expression in a
document from which it has been taken. When the expression was transplanted,
it may have brought with it some of the soil in which it once grew, retaining a
special strength and colour in its new environment. There is no inherent
necessity to read it as uprooted and stripped of every trace of its former
significance, standing bare in alien ground. True, sometimes it does stand as if
alone. But that should not be just assumed, in the case of an expression with a
known source, without looking at its creation, understanding its original
meaning, and then seeing how it is now used. Very frequently, perhaps most
often, the immediate context is the clearest guide, but the court should not deny
itself all other guidance in those cases where it can be seen that more is needed.
In literature, Milton and Joyce could not be read in ignorance of the source of
their language, nor should a legal document, including an award, be so read.
...Where the circumstances allow the court to conclude that a clause in an
award is the product of a history, out of which it grew to be adopted in its
present form, only a kind of wilful judicial blindness could lead the court to
deny itself the light of that history, and to prefer to peer unaided at some
obscurity in the language. “Sometimes”, McHugh J. said in Saraswati v. R
(1991) 172 CLR 1 at 21, the purpose of legislation “can be discerned only by
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reference to the history of the legislation and the state of the law when it was
enacted”. Awards must be in the same position.”
[11] It is well established that these principles, stated in relation to the interpretation of
awards, are equally applicable to the interpretation of industrial agreements. They
have application in the present case.”
[28] Although the task is to identify the common intention of the parties as expressed in the
terms of “their” agreement, the subjective intentions or expectations of the parties are
irrelevant. In Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd6 the High Court described the task,
in the context of commercial contracts, as follows:
“It is not the subjective beliefs or understandings of the parties about their rights and
liabilities that govern their contractual relations. What matters is what each party by
words and conduct would have led a reasonable person in the position of the other
party to believe. References to the common intention of the parties to a contract are to
be understood as referring to what a reasonable person would understand by the
language in which the parties have expressed their agreement. The meaning of the
terms of a contractual document is to be determined by what a reasonable person
would have understood them to mean. That, normally requires consideration not only
of the text, but also of the surrounding circumstances known to the parties, and the
purpose and object of the transaction.”
[29] I also note that in National Tertiary Education Industry Union v University of Western
Sydney [2014] FWCFB 2836 the Full Bench also stated:
“[28] ... It is permissible to look to the operation of an instrument when construing it.
The authorities emphasising this point in respect of industrial instruments are
numerous and uncontroversial: it has been said that the words of an award “must not
be interpreted in a vacuum divorced from industrial realities” and that the process of
construction should be one which “contributes to a sensible industrial outcome such as
should be attributed to the parties.”
[30] Further, Mason J affirmed in K & S Lake City Freighters Pty Ltd v Gordon & Gotch
Ltd:7
“Problems of legal interpretation are not solved satisfactorily by ritual incantations
which emphasise the clarity of meaning which words have when viewed in isolation,
divorced from their context. The modern approach to interpretation insists that the
context be considered in the first instance, especially in the case of general words, and
not merely at some later stage when ambiguity might be thought to arise.”8
[31] It appears to me that with one qualification, which I add for completeness, the above
approach is applicable to the construction of a Workplace Determination. Given the nature of
such an instrument, in circumstances where the Commission has arbitrated a provision, an
important part of the context would be set by the decision issued by the Full Bench as part of
making the determination. This should operate in the same manner as reasons for decisions
issued in the award making jurisdiction of the Commission.9 This aspect is not of direct
assistance in this matter.
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[32] I also add that consistent with s.739 of the Act, any decision arbitrating the dispute
must not be inconsistent with the Act or the relevant instrument.10
6. The facts
[33] It is not necessary to make extensive findings of fact for present purposes. I found
each of the witnesses were truthful and gave evidence in relation to the matters in which they
were directly involved in, with confidence and clarity.
[34] It is clear that both Ms Maynard and Mr Smith were initially engaged as casual
employees under one of the predecessors of the Workplace Determination. This was
confirmed in their letters of appointment. They were each employed at the Adelaide
operations of Q Catering for many years and became full or part-time employees during that
time.
[35] Whilst engaged as a casual, they were regularly and systematically engaged, however
their hours would fluctuate to a degree depending upon work requirements and peak periods
for airline operations.
[36] Each employee was compulsorily made redundant in March 2014 under the terms of
Appendix A of the Workplace Determination. Both had their final redundancy payments
calculated based only upon their full and part-time service and the periods of prior casual
service were not included.
[37] In each case, earlier estimates of the likely redundancy payments provided by
Q Catering had included the period of prior casual service. In the case of Mr Smith, the
Certificate of Service provided by Q Catering upon his redundancy referred to a period of
service that included the original commencement date when he started as a casual employee.
[38] There is evidence11 to support the notion that the original calculations were provided
by mistake, at least as far as Q Catering was concerned.
[39] There is no evidence that Q Catering has included prior casual service for the purposes
of Appendix A (or its predecessor) in any other cases of compulsory redundancy.
7. The application of Appendix A to prior casual service
[40] The essential question is whether Appendix A should be applied such that “service”
for the purposes of the redundancy payments is taken to include the prior periods of
employment undertaken by the employees when they were casuals.
[41] The starting point for the construction of the provision is the consideration of the
language of the instrument understood in the light of the industrial context and purpose of that
instrument. In this case, the Workplace Determination in Appendix A refers to each “year of
service” in relation to the redundancy entitlements and there is no qualifier or other express
guidance provided by the clause. It does not refer to the notion of continuous service or define
which service is to be included. If given the widest import, that expression could include
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service of any kind. However, some consideration of the context of the provision and its
ramifications is important.
[42] That broader industrial context is set in part by two factors.
[43] Firstly, casual employees are paid a loading to recognise the nature of that
employment and to compensate for the loss of access to certain entitlements that apply to
other employees. Although the 25% applicable to the casual employees in Adelaide under
clause 15.8.3(b) is not expressly identified as a casual loading, it is payable only to those
employees and is consistent with casual loadings now applying more generally.
[44] It is therefore reasonable to treat the 25% as a casual loading compensating for the
normal factors embraced by such a loading. These include the loss of access to redundancy
benefits.12
[45] In terms of the double-counting as relied upon by Q Catering, I have considered that
the loading in this context may not be seen as sufficient to “buy out” the relatively generous
redundancy payments here. However, this depends upon the circumstances. For instance, if an
employee had a long period of employment as a casual with the loading, and then became a
full-time employee just prior to being made redundant, the inclusion of the casually loaded
service might appear to be a curious result.
[46] Secondly, Appendix A does not apply to casuals. This common understanding, which
is not expressly stated in the present Workplace Determination, but is consistent with the
normal approach to redundancy provisions found in other instruments, tends to indicate that
the normal approach to such provisions more generally may also be appropriate.
[47] As part of the broader consideration of context, it is therefore also appropriate to
consider the approach taken by Courts and Tribunals to the issue more generally. In doing so,
it is evident that each instrument must be considered on its own terms and some of these
approaches have been impacted by the express terms of the agreements or other instruments
concerned.
[48] In National Tertiary Education Industry Union v La Trobe University [2009] AIRC
576 Whelan C held that in the absence of an express intention to include periods of casual
employment for the purposes of the redundancy pay provisions of the relevant agreement, the
Commission was not satisfied that any periods of casual employment should be taken into
account in calculating an employee's entitlements to redundancy pay under the agreement.
The Commission did so in the following manner:
“[62] Madgwick J in Kucks v CSR Limited stated that in interpreting an award “ordinary
or well understood words are in general to be accorded their ordinary or usual
meaning”. He also suggested that awards (and I would suggest that this is even more
likely to be the case with agreements) may have been expressed in ways likely to have
been understood in the industry. An expression such as continuous service is used
frequently in industrial instruments. In the absence of any definition expressing a
contrary intention, the context in which the Agreement was made would suggest that
the terms should be given its ordinary meaning.
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[63] In my view, the ordinary meaning of continuous service excludes periods of
casual employment because such employment is characterised by a series of contracts
or engagements which would not normally be considered as continuous employment
or continuous service.
[64]In the absence of an expressed intention to include periods of casual employment
as service for the purposes of clause 41, I am not satisfied that any periods of casual
employment can be taken into account in calculating an employee's entitlement under
that section.”
[49] In Australian Municipal, Administrative, Clerical and Services Union v Fairfax
Regional Media – Newcastle Newspapers (Herald) [2014] FWC 5631, Sams DP, was dealing
with a dispute as to whether a particular redundancy provision applied only to “permanent”
employees, and stated:13
“...the fact is that throughout (the relevant) time (the casual employees) had received a
20% casual loading on their base rates of pay. Casual loadings are intended to
compensate a casual employee for the benefits and entitlements otherwise available to
permanent part time and full time employees such as annual leave, sick leave and
redundancy payments. This has been a long held and well known principle under
workplace law.”
[50] Some instruments do expressly provide that casual, or similar service, may be included
for the purposes of redundancy payments. As relied upon by the TWU, in “Automotive, Food,
Metals, Engineering, Printing and Kindred Industries Union” known as the Australian
Manufacturing Workers’ Union (AMWU) v Safries Pty Ltd [2014] FWC 2352, O’Callaghan
SDP was dealing with an enterprise agreement which stated (in Appendix 1) that "periods of
short term employment will accumulate from year to year included for the purpose of
calculating length of service under this agreement. Provided that the break between periods of
short term or casual employment does not exceed six months." The issue to be resolved was
whether the redundancy provision applied to casual employees.
[51] After reviewing the history of casual loadings and the nature of the relevant modern
award referred to in the enterprise agreement, the SDP observed:
“[38] Consequently, in terms of the Agreement, unless Appendix 1 can be read as
establishing an entitlement for redundancy pay, I do not consider that any such right
can be inferred. ......
... ...
[40] I think that Appendix 1 must be read as establishing an entitlement to redundancy
payments for weekly employees on the basis that these payments recognise periods of
short-term or casual employment within the limitations established by clause 14.
Those periods of short-term or casual employment entitle the weekly hire employee to
receive redundancy payments calculated at a lesser rate of accrual for that period.
There is no specific entitlement to redundancy pay for employees who, at the time of
the redundancy, were not weekly hire employees.”
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[52] It is evident in this analysis that in the absence of this specific provision, such casual
service would not have figured in the calculation of the length of service for redundancy
entitlement under that agreement.
[53] In a matter more on foot with the earlier cases, the Industrial Relations Court of South
Australia in Schuman v Pace Trading Pty Ltd (2007) 169 IR 101, held that the employee’s
prior casual service should not be recognised as continuous service for the purposes of
calculating severance pay entitlements. Hardy IM found:
“[57] I am also of the view that if the applicant is to be considered to be a casual
employee during the first period of her employment and I certainly consider that to be
the case, there would have been no question that she would not have qualified for a
redundancy payment had her employment been terminated during that period of casual
employment. The applicant’s submissions depend in part upon the fact that she was
terminated as a permanent employee so that the previous casual service can be
included but I do not agree. If the casual service did not qualify her for a redundancy
during the currency of that service it makes no sense to me that it would do so at a later
juncture after some permanent service.”
[54] These cases demonstrate that the conventional approach is that in the absence of an
express provision, prior service as a casual does not count for the purposes of redundancy
entitlements. However, the particular terms of each instrument need to be considered.
[55] Against that background, I return to the specific provisions of the Workplace
Determination.
[56] Item G of Appendix A refers to a statement of service being provided to a redundant
employee. At least in the case of Mr Smith, the statement given to him reflected the entire
duration of his employment including that period when he was a casual employee. Whilst this
is a consideration, the statement is clearly intended to be a benefit to assist the redundant
employee and I do not consider that the arguably more generous approach taken to the
statement in some cases is determinative of whether that period should count for the purposes
of the redundancy calculation.
[57] There is also a provision in Appendix A dealing with the circumstances where an
employee converts from full-time to part-time. The fact that there is no similar provision
relating to how the casual service is to be treated, which could by definition fluctuate more
widely than part-time work, is more consistent with that form of service not being
contemplated.
[58] The pay calculation for redundancy payments is based upon the ordinary time rate and
includes regular weekly payments. This is consistent with the agreed position that the
redundancy benefits apply only to part and full-time employees. However, it is not of any real
assistance in dealing with the prior service issue.
[59] The inclusion of the casual service as part of the initial calculations provided to the
employees is also not decisive given the evidence including the absence of previous
recognition of casual service for present purposes.
[2014] FWC 6160
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[60] There is evidence to suggest that at least some, and potentially most, casual employees
at the Adelaide operations of Q Catering in past years were engaged on a relatively regular
and consistent basis. Clause 15.8 contemplates casual employees being primarily used to meet
unplanned or peak workloads to maintain the efficiency of the Company's operations.
However, the provision is not written in exclusive terms and the casual employees here were
engaged and paid as casuals for the relevant initial periods of their employment.
[61] Some insight into the notion of service by casual employees can be gained from the
consideration of the Full Bench in Wayne Shortland v The Smiths Snackfood Co Ltd,14
(Shortland) which said:
“[10] As a matter of the common law of employment, and in the absence of an
agreement to the contrary, each occasion that a casual employee works is viewed as a
separate engagement pursuant to a separate contract of employment. Casual employees
may be engaged from week to week, day to day, shift to shift, hour to hour or for any
other agreed short period. In this sense no casual employee has a continuous period of
employment beyond any single engagement. Moreover, it is common for a casual
employee to transition between a period in which their engagements with a particular
employer are intermittent and a period in which their engagements are regular and
systematic and vice versa. It is against that background that s.384 must be construed.”
[62] I note that this decision was in the context of the provisions of the Act dealing with the
period of employment necessary to be protected from unfair dismissal, and the rest of the
decision deals with the particular statutory provisions which are not relevant here.
[63] Shortland suggests that the traditional approach to the nature and treatment of casual
non-continuous employment and service, in the absence of an express contrary provision -
which is not found here, is capable of extending to the kind of service undertaken by the
casuals at Q Catering.
[64] I would however accept that the kind of casual employment here is more consistent
with the nature of service that might, at least conceptually, be recognised for the purposes of
redundancy.
[65] In the end, there is a balance of considerations. Although “year of service” may be
given the widest import to include service of any kind, there is no express provision
confirming that the prior casual service is to be counted and there is no history of such service
being included for present purposes. Further, the nature of casual employment, the general
context for the operation of redundancy provisions, and the fact that it is agreed that Appendix
A does not apply to casual employees, are important factors. Despite some contrary
considerations set out above, I do not consider that the intention of the Workplace
Determination should be taken to operate in that manner.
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8. Conclusions
[66] On balance, I do not consider that full-time (or part-time) employees, who have
previously had a period of employment as a casual employee, are entitled to have the prior
service as a casual employee included for the purpose of calculating compulsory redundancy
entitlements under the terms of the Workplace Determination.
Appearances:
E Lawrie for the Transport Workers’ Union of Australia.
I Colgrave of Counsel, with permission for the Q Catering Limited.
Hearing details:
2014.
Adelaide.
September 5.
Printed by authority of the Commonwealth Government Printer
Price code C, PR555119
1 Then known as Fair Work Australia.
2 [2012] FWAFB 6612.
3 The scope of Appendix A was confirmed by both parties at the commencement of the hearing in this matter.
4 Transport Workers’ Union of Australia (Qantas Airways Limited) Enterprise Agreement V.
5 TWU written outline of submissions.
6 (2004) 219 CLR 165.
7 (1985) 60 ALR 509 at 514.
8 Also see Solution 6 Holdings Ltd v Industrial Relations Commission of NSW (2004) 208 ALR 328 at 348 per
Spigelmann CJ.
9 See Australian and International Pilots Association v Qantas Airways Limited [2014] FWC 6201.
10 S.739(5) of the Act.
11 Statement of Ms Marendaz - exhibit Q1.
[2014] FWC 6160
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12 The history of casual loading and the basis of the 25% loading now found in modern awards is set out in Metal,
Engineering and Associated Industries Award 1998 [2008] AIRCFB 1000, [47]-[52].
13 Although Sams DP was giving an opinion in the matter rather than making a determination, the observations are illustrative
of the approach taken by the Commission in other matters.
14 [2010] FWAFB 5709.
17
APPENDIX A - COMPULSORY REDUNDANCY
Redundancy occurs if the Company has made a definite decision that the Company no longer
wishes the job the employee has been doing done by anyone; and the decision is not due to
the ordinary and customary turnover of labour.
The Company and where the redundancy impacts a member of the Union, the Union agrees to
seek to manage all necessary staff reductions in a manner aimed at minimising the need for
redundancies. Only after these means have been exhausted will a redundancy program be
embarked upon.
Notwithstanding any obligations for notification that accrue as a result of the Act, where the
Company decides to terminate the employment of employees on account of redundancy, then
as soon as practicable after so deciding, and before the terminations take place, employees
and where the redundancy impacts a member of the Union, the Union will be advised of the
decision, together with:
● The terminations and the reasons for them;
● The number and categories of employees likely to be affected; and
● The time when, or the period over which, the Company intends to carry out the
terminations.
Further, prior to termination of employment and prior to the final determination, the Company
will meet as a minimum its statutory obligations to consult employees and where the
redundancy impacts a member of the Union, the Union on measures to avert or minimise the
terminations, and implement measures (such as finding alternative employment) to mitigate
the adverse effects of the terminations.
The redundancy program shall have regard to:
● Retaining an age, skill and experience balance within areas of employment in each
employment category;
● No discrimination against employees; and
● Special efforts to minimise retrenchment of apprentices or trainees.
The Company will consult with the Union where the redundancy impacts a member of the
Union, on the process to be adopted on a case-by-case basis.
Redundancy payments
For redundancy under the terms of this Workplace Determination, the following package shall
apply:
● Three (3) weeks’ pay for each year of service up to and including five (5) year’s
service, with a minimum of four (4) weeks’ pay.
● Four (4) weeks‘ pay for each completed year of service in excess of five (5) years;
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and
● Pro-rata payment for each completed month of service.
● The above-mentioned payments do not include payments in lieu of notice.
Pay calculation
For the purposes of this Workplace Determination, ―pay shall be paid at the ordinary time
rate prescribed in this Workplace Determination and shall include regular weekly payments,
such as service increments and supervisory allowances, but shall exclude shift, overtime and
extraneous payments.
Notice period
An employee will be given the following period of notice of termination on the grounds of
redundancy instead of the period of notice prescribed by Clause 16 – Termination of
Employment.
Completed years of service Notice in weeks
Up to and including 4 years 4
5-9 years 8
10 years and above 12
Provided that an employee who is over 45 years of age will receive no less than 5 weeks
notice.
Maximum redundancy payment
Any redundancy payments for full time employees who convert to part-time will continue to
be calculated on full-time equivalent salary with the period of service being adjusted to reflect
the hours actually worked.
Maximum redundancy payment
Part 1: This component shall only be available to employees who commenced their
employment on or prior to 16 October 1996:
● The then value of an employee‘s accumulated redundancy payments as at 16
October 1996 shall be frozen in money terms and increased by 2% per annum for each
year of service after 16 October 1996. To this amount shall be added any redundancy
payments that accrue under the new redundancy scheme (see Part 2) for service from
16 October 1996. An employee‘s actual date of commencement of service will be used
to calculate any redundancy payments under Part 2 (that is, for the purpose of
determining whether 3 weeks or 4 weeks pay per year of service applies pursuant to
the redundancy payments prescribed above for the calculation under Part 2).
Part 2: Applies to Employees engaged after 16 October 1996 and to service after 16 October
1996 for employees engaged on or prior to 16 October 1996:
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● The new redundancy scheme shall apply to all employees. The maximum benefit for
redundancy pay under the new redundancy scheme shall be ninety-five (95) weeks pay
exclusive of notice periods.
Other entitlements
A. Annual Leave Loading
Accrued annual leave credits, including pro-rata leave due at the date of termination, will be
paid at the greater of the annual leave loading (17.5%) or the projected shift penalties
pertaining to the individual.
B. Long service leave
Pro-rata long service leave shall be paid to employees with more than twelve (12) months’
continuous service. For the purpose of these provisions, long service leave will be applied in
accordance with the amount provided under the Company’s long service leave provisions.
C. Superannuation
Superannuation payments will be as per Company plan rules, plus full vesting of
the Company’s contributions with interest where not already applicable.
D. Preservation
It will be necessary to comply with the government’s regulations in respect of the
preservation of superannuation benefits.
E. Employee Travel
See staff travel policy manual.
F. Redeployment
● To other duties. Where an employee has been redeployed to a lower paid position,
the employee shall be given four (4) weeks‘ notice of transfer and receive salary
maintenance (being the difference between the former ordinary time rate and the new
lower rate) for a period of six months following the transfer.
● To other ports. Where the Company offers and the employee accepts redeployment
requiring a change of domicile, e.g. Sydney to Perth, Cairns to Brisbane, the employee
shall be entitled to normal transfer costs in accordance with Company policy.
G. Company Certificate of Service
A statement of service will be issued to each redundant employee, indicating the employee‘s
length of service and that he/she was retrenched from the airline. This certificate can be
collected from the Company on the employee‘s last day of employment.
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H. Notification to Relevant Authorities
The Company shall notify relevant authorities as required by the Act as soon as possible of
relevant information in respect of those employees’ compulsory retrenchment and arrange
visits by the relevant authorities to appropriate Company premises.
I. Outplacement Services
The Company will provide outplacement service for all retrenched employees. The level of
outplacement service provided will be determined by the Company in consultation with
relevant authorities and will include a detailed work history of the employee and assistance
towards the preparation of CVs. Where practicable, outplacement services will be provided
during the period of special paid leave and prior to cessation of employment with the
Company.
J. Financial Counselling
All employees nominated for retrenchment will be provided with a detailed estimate of the
redundancy pay and superannuation entitlements, at the time of their nomination.
Employees who are retrenched will have access to financial counselling.
Where practicable, financial services will be provided to the employee during the period of
special paid leave.
Where practicable, this service will be provided on Company premises.
K. Welfare Services
The services of the Company‘s employee assistance counsellors will be available
on request for an appropriate period to any employee compulsorily retrenched.
L. Appeal Rights
An employee who receives notice of redundancy and wishes to continue in employment with
the Company may apply for a review of the decision within four (4) working days of
receiving that notice. The Company shall complete the review process within two weeks. The
notice period shall be suspended for the period of the review.
M. Employment
A retrenched employee will be given preference for re-employment where it is advertised
externally, subject to meeting the requirements of the position.
This provision shall not apply where an employee has rejected suitable and reasonable
redeployment. Where redeployment has been rejected, a Company employee is ineligible to
be offered re-employment under the terms of this clause until a period of twelve (12) months
has elapsed from the employee‘s date of retrenchment on account of redundancy.
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This twelve (12) month period does not apply to redundant employees seeking employment
with the Company as casuals under the casuals’ clause of this Workplace Determination.
N. Time off during the period of Notice
If the Company gives an employee notice of termination, the Company must allow the
employee up to one day’s paid leave during each week of notice to seek other employment.
If more than one day’s leave is taken, the employee must, at the Company‘s request provide
proof of attendance at an interview. If proof is not provided, the employee must not be paid
for the time off.
O. Employee leaving during the Notice period
An employee whose employment is terminated by reason of redundancy may terminate
his/her employment during the notice period. If the employee does so, the employee is
entitled to the same benefits and payments under this clause had the employee remained with
the Company until the expiry of the notice period. The employee is not, however, entitled to
payment in lieu of notice.
P. Retraining
Where practicable retraining opportunities will be provided to employees declared redundant.
Q. Suitable Alternative Employment
The Company will take reasonable steps to arrange or assist in obtaining suitable alternative
employment for employees who would otherwise be retrenched.
The Company, in any particular redundancy case may make an application to FWA pursuant
to Clause 12, Procedures for the Settlement of Industrial Disputes, to vary the redundancy pay
prescription if the Company obtains acceptable alternative employment for an employee.
R. Transfer of business
If a transfer of business occurs, and an employee of the Company becomes a transferring
employee :
(a) an employee‘s continuity of service is deemed not to have been broken by reason
of the transmission; and
(b) the employee‘s period of employment with the Company or any other prior
transmittor is deemed to be service of the employee with the new employer.
Immediately prior to the transfer of business, the Company will provide transferring
employees with a statement of their accrued and untaken personal, annual and long service
leave.
S. Savings
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Nothing contained within this Workplace Determination shall reduce any statutory protections
with respect to redundancy related arrangements unless otherwise expressly agreed by
exchange of correspondence.
