1
Fair Work Act 2009
s.604—Appeal of decision
Communications, Electrical, Electronic, Energy, Information, Postal,
Plumbing and Allied Services Union of Australia; “Automotive, Food,
Metals, Engineering, Printing and Kindred Industries Union” known as the
Australian Manufacturing Workers’ Union (AMWU); Construction,
Forestry, Mining and Energy Union
v
Mechanical Maintenance Solutions Pty Ltd
(C2015/1018; C2015/1019; C2015/1079)
SENIOR DEPUTY PRESIDENT HARRISON
DEPUTY PRESIDENT SAMS
COMMISSIONER BULL SYDNEY, 19 MARCH 2015
Appeal against decision [2014] FWC 9163 of Deputy President Gostencnik in Melbourne on
17 December 2014 in matter number C2014/361 - s.739 dispute settlement procedure -
interpretation of enterprise agreement.
[1] This decision concerns appeals by the Communications, Electrical, Electronic, Energy,
Information, Postal, Plumbing and Allied Services Union of Australia (CEPU), the
“Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as
the Australian Manufacturing Workers’ Union (AMWU) and the Construction, Forestry,
Mining and Energy Union (CFMEU), against a decision which arose out of an application
made under s.739 of the Fair Work Act 2009 (the Act). The appeals were heard together, the
grounds of appeal in each being the same. They concern a decision of Deputy President
Gostencnik1 about the interpretation of a clause common to two enterprise agreements.2 The
respondent to each of the appeals is Mechanical Maintenance Solutions Pty Ltd (MMS).
[2] In the hearing before us, Mr Terzic appeared for the AMWU and Ms Reid for the
CFMEU. Prior to the hearing, the appellants had filed a joint submission. Ms Zeitz appeared,
with permission, for MMS, which had also filed a written submission.
[2015] FWCFB 1769
DECISION
E AUSTRALIA FairWork Commission
[2015] FWCFB 1769
2
[3] The two enterprise agreements in question are the Mechanical Maintenance Solutions
Pty Ltd (MMS) Latrobe Valley (Victoria) Power Industry Electrical (ETU) Greenfields
Enterprise Agreement 2013 (Electrical Agreement)3 and the Mechanical Maintenance
Solutions P/L (MMS) Latrobe Valley Power Stations (AMWU and CFMEU) Greenfields
Enterprise Bargaining Agreement 2012-2016 (Mechanical Agreement).4
[4] The issue in dispute was described by the Deputy President in these terms:
“[2] The issue in dispute may be simply stated. Each agreement provides for a power
station shutdown/outage allowance which is expressed in each agreement to be an all
purpose allowance. The issue in dispute is whether in circumstances where the power
station shutdown/outage allowance is payable to a casual employee, that allowance is
to be added to the ordinary hourly rate of pay before or after the application of the 25%
casual loading provided for in each agreement. MMS contends that under both
agreements it is the former, the AMWU and the CFMEU contend it is the latter in
relation to the Maintenance Agreement and the CEPU also contends that it is the latter
in relation to the Electrical Agreement.”
[5] The Deputy President preferred the construction of the enterprise agreements for
which MMS contended and he ruled:
“[25] For the reasons given above, in my view the construction of the relevant
provisions of the agreements and consequently the order in which the 25% loading and
the hourly flat rate power station shutdown/outage allowance in each agreement is
applied, is as contended for by MMS. First the relevant classification rate of pay for a
casual employee is identified which is then divided by 36. Next the 25% casual
loading is applied to that classification rate and then in the prescribed circumstances,
the hourly flat rate provided for in the power station shutdown/outage allowance is
applied.”
[6] The appellants challenge the decision, arguing before us, as they did at first instance,
for their construction of the relevant clauses to be accepted. Before turning to the Deputy
President’s reasons for decision, we should indicate that a number of matters are not in issue
in these appeals. It is accepted that the Deputy President correctly described the matter in
issue and the question he was required to answer. It is also accepted that he identified the
correct principles applicable to the construction of an enterprise agreement. In that respect, he
[2015] FWCFB 1769
3
referred to the Full Bench decision in Australasian Meat Industry Employees Union v Golden
Cockerel Pty Limited.5 The grounds of appeal did not challenge the findings made by the
Deputy President about the utility of some affidavit evidence concerning “the surrounding
circumstances”6 and an argument about the relevance of the Electrical Agreement
incorporating certain provisions of the Electrical, Electronic and Communications
Contracting Award 2010.7
[7] We turn the Deputy President’s reasons for his decision. We should reproduce the key
paragraphs. They are as follows:
“[11] Each agreement makes provision for a power station shutdown/outage allowance.
That allowance is payable to employees working in connection with the power station
shutdown or outage. It is paid for each hour an employee is engaged in the work
during for the period of the shutdown or outage and during periods an employee is
engaged in pre-outage and post-outage work. The allowance is also expressed to be an
all purpose allowance with the effect that it is added to an employee’s ordinary hourly
rate of pay and then becomes the base from which other penalties and allowances are
calculated.
[12] The power station/outage allowance is expressed as a flat dollar amount. If it
were expressed as a percentage then whether or not it is to be applied, in the case of a
casual employee, to the hourly rate of pay before or after the calculation of the 25%
casual loading, the result would be the same. However the application of a flat dollar
amount to the rate of pay before calculation of the 25% casual loading yields a higher
result and therefore higher all purpose rate of pay than if the flat dollar value of the
allowance is applied after the 25% casual loading is calculated and added.
[13] Clause 7.1.2 of the Mechanical Agreement and clause 8.3.1 of the Electrical
Agreement relevantly establish the rate of pay per hour for a casual employee for work
performed during ordinary hours work. This is clear from the introductory words of
the second sentence in each clause, namely, “a casual employee for working ordinary
time shall be paid . . .” That rate of pay includes a casual loading of 25%.
[14] When a casual employee performs work during ordinary hours that is also work
which attracts the power station shutdown/outage allowance provided for in each of
the agreements, the flat dollar hourly allowance is added to the hourly rate of pay to
[2015] FWCFB 1769
4
which a casual employee is entitled for working ordinary hours. As the rate of pay to
which a casual employee becomes entitled for working those ordinary hours already
includes a 25% loading by reason of clause 7.1.2 of the Mechanical Agreement and
clause 8.3.1 of the Electrical Agreement, it follows that the hourly power station
shutdown/outage allowance is added to that rate of pay.
[15] The construction contended for by the unions would result in the rate of pay to
which a casual employee is entitled for working ordinary hours being higher than that
provided for in clause 7.1.2 of the Mechanical Agreement and clause 8.3.1 of the
Electrical Agreement by reason of the multiplier effect of the 25% loading being
calculated after the addition of the allowance. Alternatively it results in the value of
the allowance being higher for casual employees than for other employees by reason
of the multiplier effect. This would be inconsistent with the fixed flat dollar rate of the
allowance. There is in my view no sound reason to be discerned from the text of the
provisions why this should be the result and in my view is inconsistent with the plain
language of clauses 7.12 of Mechanical Agreement and 8.3.1 of the Electrical
Agreement which clearly establish a consistent hourly rate of pay for a casual
employee working ordinary hours and with the fixed value nature of the allowance set
out in clauses 36.6.3 of the Mechanical Agreement and 19.3.11 of the Electrical
Agreement.
[16] Furthermore the construction I prefer is consistent with the all purpose nature of
power station shutdown/outage allowance because ultimately it is added to the
ordinary time rate of pay for a casual employee (which includes a 25% loading) and
thereafter is included as a base in the calculation of other penalties of allowances that
might become payable, for example, overtime. This is exactly the same method used
for non casual employees and there is nothing in the text of the agreement that would
suggest a contrary approach.
[17] An all purpose allowance forms part of an employee’s ordinary time base rate of
pay. A casual employee’s ordinary time base rate of pay is established relevantly by
clause 7.1.2 of the Mechanical Agreement and clause 8.3.1 of the Electrical
Agreement. This includes the 25% casual loading. The hourly power station
shutdown/outage allowance, being an all purpose allowance is applied to that ordinary
[2015] FWCFB 1769
5
time base rate of pay with the result in the case of a casual employee, it is applied after
the casual loading has been applied.”
[8] We have considered the written and oral submissions of the appellants. We are not
persuaded that they identify any appealable error in the Deputy President’s reasons. In our
opinion, the construction of the two agreements adopted by him is correct.
[9] An issue was addressed in the parties’ submissions as to the nature of these appeals
and whether permission to appeal is required. The issue is whether the dispute resolution
procedures in the two enterprise agreements give rise to an independent right of appeal and,
accordingly, permission to appeal need not first be sought and granted. The appellants
contend that the provisions of each enterprise agreement were sufficiently similar to those
considered in the Full Bench decision in AMWU v Silcar Pty Ltd (Silcar),8 so that they had a
right to appeal. The relevant clause considered in Silcar was that “[t]he decision of FWA will
bind the parties, subject to either party exercising a right of appeal against the decision to a
Full Bench.”9 About the effect of that clause the Full Bench said:
“[27] Subject to the observations in paragraph [17] above, when a dispute resolution
procedure in an enterprise agreement simply makes provision for an “appeal” this
should generally be interpreted as an appeal in accordance with the appeal provisions
in the FW Act. Such an appeal is an appeal by way of rehearing. Where, as here, the
parties have conferred a “right” of appeal, this language suggests an intention that the
appeal be as of right (that is, without the need for permission to appeal) but otherwise
in accordance with the appeal processes in the FW Act. However, the question remains
one of interpreting the agreement to ascertain the intention of the parties, objectively
determined, and the use of the word “right” may not be determinative.”
[10] We note the same approach to an enterprise agreement appeal clause, in the same
terms as Silcar, has been recently taken by a Full Bench decision in Presbyterian Care
Tasmania Incorporated.10
[11] The relevant clause in the dispute settlement provision of the Maintenance Agreement
which deals with appeals reads:
“31.3.1
...
[2015] FWCFB 1769
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(e) At the end of the cooling off period if the matter remains unresolved either party
may submit it to FWA for conciliation or arbitration, whose decision, subject to the
parties’ rights of appeal, shall be accepted.
...”.
[12] The comparable clause in the Electrical Agreement provides:
“ ...
32.7. Where a matter does progress to FWA for arbitration or review, its decision shall
be final and binding on the parties, subject to either party exercising any right of
appeal against the decision to a Full Bench.”
[13] It is to be noted that neither of the above clauses is in exactly the same terms as the
clause considered in Silcar. In our opinion, the provisions in the Electrical Agreement in
particular being “subject to either party exercising any right of appeal”, do not immediately
persuade us that they should be interpreted as providing an appeal as of right rather than being
an acknowledgement that an appeal consistent with s.604, including the need to gain
permission, is intended. We have decided this is not the occasion to attempt to identify which
form of words should be accepted to constitute a right to appeal and which form does not. In
our opinion, in these appeals, it matters not whether the appellants have a right to appeal or
are first required to obtain the grant of permission to do so. Assuming each enterprise
agreement gives a right of appeal, in light of our finding that the Deputy President’s decision
was correct, the appropriate order for us to make is to dismiss the appeals. If, in the
alternative, the appellants are required to seek permission to appeal, there is nothing raised in
the grounds of appeal or submissions which persuades us that the public interest is enlivened,
nor that permission for any other reason11 is warranted.
[14] The appeals are dismissed.
SENIOR DEPUTY PRESIDENT
[2015] FWCFB 1769
7
Appearances:
Mr B Terzic for the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries
Union” known as the Australian Manufacturing Workers’ Union (AMWU).
Ms K Reid for the Construction, Forestry, Mining and Energy Union.
Ms S Zeitz for Mechanical Maintenance Solutions Pty Ltd.
Hearing details:
Sydney.
2015.
March 17.
Printed by authority of the Commonwealth Government Printer
Price code C, PR562016
1 [2014] FWC 9163.
2 The CEPU is covered by the Mechanical Maintenance Solutions Pty Ltd (MMS) Latrobe Valley (Victoria) Power Industry
Electrical (ETU) Greenfields Enterprise Agreement 2013 (AE404396). The AMWU and CFMEU are covered by the
Mechanical Maintenance Solutions P/L (MMS) Latrobe Valley Power Stations (AMWU and CFMEU) Greenfields
Enterprise Bargaining Agreement 2012-2016 (AE404438).
3 AE404396.
4 AE404438.
5 [2014] FWCFB 7447.
6 [2014] FWC 9163, [5].
7 MA000025.
8 [2011] FWAFB 2555.
9 Ibid [16].
10 [2013] FWCFB 8166.
11 For example, that the decision is attended with sufficient doubt to warrant its reconsideration, or that substantial injustice
may result if leave is refused.
