[2015] FWCFB 1889
The attached document replaces the document previously issued with the above code on 31
March 2015.
The document has been edited to correct the last sentence of paragraph [2]. This sentence
originally read: “The investigation into the altercation resulted in a decision not to take any
disciplinary action against Mr Genovese, and his stand-down was lifted on 31 July 2014.”
This sentence now reads: “The stand-down was lifted on 31 July 2014.”
Catherine Taylor
Associate to Vice President Hatcher
Dated 10 April 2015
1
Fair Work Act 2009
s.604 - Appeal of decisions
Lend Lease Project Management and Construction (Australia) Pty Limited
v
Construction, Forestry, Mining and Energy Union
(C2015/1396)
VICE PRESIDENT HATCHER
JUSTICE BOULTON, SENIOR DEPUTY PRESIDENT
DEPUTY PRESIDENT SAMS SYDNEY, 31 MARCH 2015
Appeal against decision [[2015] FWC 257] and Order [PR560380] of Deputy President
Lawrence at Sydney on 22 January 2015 in matter number C2014/6296.
Introduction and background
[1] Lend Lease Project Management and Construction (Australia) Pty Limited (Lend
Lease) has applied for permission to appeal and appeals a decision of Deputy President
Lawrence issued on 22 January 20151 (Decision) and an accompanying order2 (Order) of the
same date. The Decision and Order were made arising from an arbitration conducted pursuant
to the dispute resolution process contained in clause 19, Conflict Resolution, of the Lend
Lease Project Management & Construction/CFMEU Joint Development Agreement Mark 8
2012-16 (Agreement). The dispute the subject of the arbitration had arisen at the Barangaroo
South Project (Barangaroo), and involved the question of whether Mr Peter Genovese, a
Construction, Forestry, Mining and Energy Union (CFMEU) delegate who had been
employed at that project but had gone off work for an extensive period due to a psychological
illness, should return to work to his former role as delegate at Barangaroo or should return to
work at an alternative work site nominated by Lend Lease. The Order made by the Deputy
President, which took effect on 27 January 2015, required that “Mr Peter Genovese be
returned to his normal duties/role at the Lend Lease Barangaroo site, in accordance with the
return to work plan drafted by Ms Irene Bagia, dated 10 October 2014”. Lend Lease contends
that the Decision and Order were attended by appealable error and should be quashed.
[2] The factual background to this appeal may be summarised as follows. Lend Lease is
the developer of Barangaroo. Mr Genovese is employed as a construction worker by Lend
Lease, and in recent years his role has been to act as CFMEU delegate and employee safety
representative at the Barangaroo site. Arising from an altercation with a manager in February
2014, he was stood down from work with pay pending an investigation of the incident on 26
March 2014. During this period, Mr Genovese developed a psychological illness which
required his hospitalisation. The stand-down was lifted on 31 July 2014.
1 [2015] FWC 257
2 PR560380
[2015] FWCFB 1889
DECISION
E AUSTRALIA FairWork Commission
[2015] FWCFB 1889
2
[3] At this point, Mr Genovese’s health having recovered to a significant degree, a dispute
arose about his return to work. Mr Genovese had been cleared to return to work at
Barangaroo, subject to a graduated return to work plan, by his two treating doctors, Dr
Chandler and Dr Paisley. However Lend Lease took the position that it would not permit Mr
Genovese to return to work at Barangaroo until it was satisfied that such a return to work
could be effected in a safe and durable manner. After various communications between Lend
Lease and Mr Genovese’s solicitors, Mr Genovese was required by Lend Lease to attend a
consultation with Dr Lousie Crowle, an occupational physician, on 17 September 2014. Dr
Crowle subsequently issued a report dated 25 September 2014 in which she stated the opinion
that Mr Genovese was medically fit to commence a graded return to the duties of his usual
position and roles at Barangaroo, although he was not yet fit to return to work on a full-time
basis. Dr Crowle made a number of recommendations to support a graduated return to work at
the Project, including the development of an agreed return to work plan. She also stated that if
Lend Lease was unable to support a return to work plan at Barangaroo, alternative work sites
could be considered.
[4] Lend Lease then began to take steps to prepare a return to work plan for Mr Genovese.
Lend Lease directed Mr Genovese to meet with Ms Bagia, an injury management and
assessment consultant hired by Lend Lease, to progress the development of the return to work
plan. After Ms Bagia met with Mr Genovese on 7 and 10 October 2014, and also met with his
treating doctor, Dr Chandler, she sent a draft return to work plan, which provided for Mr
Genovese to return to work at Barangaroo on a graduated basis, to Lend Lease on 13 October
2014. However Mr Murray Coleman, the Managing Director of Lend Lease, did not accept
the plan insofar as it involved a return to work at Barangaroo, and proposed instead that the
return to work plan proposed by Ms Bagia be implemented at a different and much smaller
worksite, namely the Nanoscience project at the University of Sydney. This alternative
proposal was not acceptable to Mr Genovese.
[5] Consequently the dispute about Mr Genovese’s return to work, which had throughout
the course of the events described above been the subject of various conciliation proceedings
before the Commission, was set down for arbitration by the Deputy President in accordance
with clause 19 of the Agreement. The hearing occurred on 6 and 25 November and 2-3
December 2014.
The Decision
[6] In the Decision, after setting out the background to the dispute and the relevant
provisions of the Agreement and the Fair Work Act 2009 (FW Act), the Deputy President
summarised the evidence before him, including the medical evidence. This included reference
to a certificate of Dr Chandler dated 4 August 2014 in which he stated “I consider he should
resume work in his normal job at Barangaroo as it is important that he succeeds back at the
same job”, and a return to work certificate of Dr Paisley dated 7 August 2014 which stated “It
is important for him to return to his prior position as he is already familiar with the
workplace and colleagues as well as the duties expected of him. A change of workplace may
place additional stress on him which could be detrimental to his recovery.”3 The Deputy
President also quoted at some length a subsequent report by Dr Paisley dated 21 October
2014, which stated:
3 Decision at [24]
[2015] FWCFB 1889
3
“In my opinion Mr Genovese is safe to return to his usual Full-Time employment
position and could safely perform the inherent requirements. However it would be best
if he could be reintroduced on a graduated basis given that he has not worked for the
past 7 months. I have already proposed commencing at 2 days per week and this could
be increased by 1 day per week every 1-2 weeks as tolerated. I predict that he would
be back to his usual full-time within 1-2 months.
I believe the best course of action for Lend Lease to assist Mr Genovese’s wellbeing
would be to enact a return to work plan at the Barangaroo site immediately. The
ongoing uncertainty regarding his work situation, and looming threat of being moved
to another worksite, is likely to have a detrimental effect on his mental health if
unnecessarily prolonged. The loss of role, sense of purpose, identity, control and self-
esteem are factors associated with unemployment being a well recognised risk factor
for Major Depression.
. . .
As long as his workload is effectively managed and he is monitored, I can see no
reason why he couldn’t return to this site again, especially now that he is well. Moving
to another site would mean the loss of the positive aspects of his job at Barangaroo and
may lead to more stress (unfamiliar site, new colleagues, additional uncertainty) as
well as possibly even a sense of feeling ostracised, punished or demoted as a result of
his medical condition. There is no medical reason why he should be shifted to another
workplace and indeed a move may indeed be detrimental to his mental health for the
reasons outlined above.”4
[7] The Deputy President also referred to a witness statement made by Ms Bagia, who
was not required for cross-examination by Lend Lease, in which she stated: “I confirm that in
my professional opinion Mr Genovese will be able to cope with the work and is
psychologically ready and able to return to the Barangaroo site”.5
[8] The evidence of Mr Coleman, who made two statements of evidence for the purpose
of the arbitration on behalf of Lend Lease and was subject to extensive cross-examination,
was summarised in detail in the Decision. The Deputy President’s summary of this evidence
included the following:
“[29] Mr Coleman asserts that he wants Mr Genovese to return to work as soon as
possible. He further asserts that his decision is based on his view of his duty of care to
Mr Genovese and all workers at Barangaroo.
[30] Mr Coleman’s statement sets out in detail the chain of events relating to Mr
Genovese’s return to work from Lend Lease’s viewpoint. He asserts that he has taken
the same approach to Mr Genovese as he would to any employee.
[31] The main issue for Mr Coleman was “the avoidance or effective management of
workplace stress” (Exhibit D1, Para 45). The professional advice did not resolve this
issue for him. Accordingly, he made a decision that a return to work at the smaller
4 Decision at [24]
5 Decision at [26]
[2015] FWCFB 1889
4
University of Sydney site would be less stressful and therefore more appropriate. This
decision was based on his extensive professional knowledge and experience.
. . .
[33] In his supplementary statement (Exhibit D2) Mr Coleman provides further detail
about the size and complexity of the Barangaroo site. He points out that delegates and
safety representatives are required to deal with issues which do not arise on other sites.
These have included bomb-threats, fires and the suicide of a worker. He emphasises
the pressure that is created on all involved by the public attention given to Barangaroo.
All of this contrasts with the much more confined layout and low-key nature of the
University of Sydney site.”
[9] The Decision then set out the parties’ respective submissions. The summary of Lend
Lease’s submissions included the following:
“[44] Lend Lease framed the question which is to be determined by the Commission as
follows: “By not agreeing to a return to work plan that would have Mr Genovese
resume specified duties at the Barangaroo site and by imposing a requirement that the
graduated return to work be at the Nanoscience Project, has the Respondent failed to
treat an Employee Representative fairly and without discrimination as required under
clause 16.1(d) of the JDA8?” (Submission, 27 November 2014, paragraph 1)
[45] Lend Lease submits that the CFMEU has not established that this clause has been
breached. It further submits it is not appropriate for the Commission “to overrule a
judgment call made by a responsible and experienced Managing Director on a
complex safety and rehabilitation issue”. (Submission, 27 November , paragraph 5)
[46] Clause 16.1(d), Lend Lease submits, protects against unfair or discriminatory
treatment in the carrying out of the employee representative function. Mr Genovese
does not have special rights or immunities as a union delegate. The CFMEU needs to
establish that Mr Coleman’s decision is illegitimate or unreasonable. Lend Lease
submits that the decision of Mr Coleman was genuine and responsible.”
[10] The Deputy President introduced his consideration of the matter as follows:
“[50] Ultimately, the issue to be determined in this matter is a narrow one. Both Lend
Lease and the CFMEU agree that Mr Genovese should return to his normal duties in
accordance with Ms Bagia’s return to work plan of 10 October 2014. The difference is
about the location. The CFMEU says at Barangaroo, Lend Lease says at the
Nanoscience Project, University of Sydney.
. . .
[52] This case is unusual to say the least. We have the Managing Director of a major
employer personally involved in the return to work plan of an employee following a
medical condition. There was acceptance of Mr Genovese’s role as a virtually full-
time delegate and health and safety representative. This was the role to which, it was
accepted, he would return to as a CW5. Furthermore, the Commission is required to
resolve a dispute about a matter which would usually be dealt with by relatively junior
employees in accordance with established policies and practices and based on medical
and other professional advice.”
[2015] FWCFB 1889
5
[11] The Deputy President then analysed the extent of his power to arbitrate the matter. By
reference to ss.738, 739 and 595 of the FW Act and clause 19 of the Agreement, the Deputy
President determined that he had a general power, without any specified limitation, to deal
with the dispute by arbitration6, and that he should do so having regard to that part of the
object of the FW Act set out in s.3(e).7 In that context, he identified the issue requiring
resolution in the following terms:
“[59] It seems to me that the question to be answered by the Commission, as framed by
Lend Lease, set out in [28] and [44] above is too narrow. Rather, I would frame the
question as: “Is it appropriate for the Commission to exercise its powers by arbitration
to settle the dispute? Further, if the Commission considers it should intervene, what
orders would be fair and practical in all the circumstances?”
[12] The Deputy President’s reasoning as to the conclusion he reached that an order should
issue requiring Mr Genovese to be returned to work at Barangaroo in accordance with Ms
Bagia’s proposed return to work plan was as follows:
“[62] I accept that there is a high bar for the Commission to intervene to overturn the
decision of management in a case such as this. As I have already noted, this case is
very unusual. It should have been resolved by conciliation but in three conferences it
could not be.
[63] I do not doubt the integrity of Mr Coleman or question the veracity of his
evidence. I accept that he is a senior manager with many years of experience in the
construction industry. He has a responsibility to ensure a safe system of work on all
Lend Lease sites including Barangaroo, However, Lend Lease have agreed to the
Commission resolving disputes in an exceptional case such as this.
[64] I have come to the view that it is appropriate to grant the orders sought by the
CFMEU in the circumstances of this case for the following reasons:
(a) Lend Lease set up its own policies and procedures to deal with these
matters but has departed from them. At each step, the choices made, such as
the selection of Dr Crowle and Ms Bagia were Lend Lease’s. Yet, it failed to
follow the process to its conclusion.
(b) All of the medical and professional advice is in favour of a return to work
at Barangaroo. The views of Dr Chandler, Dr Paisley, Dr Crowle and Ms Bagia
are set out in [8], [12], [13], [24] [25] and [26] above.
(c) Mr Coleman’s particular concern was that the nature of the Barangaroo site
would increase Mr Genovese’s workplace stress and therefore impede his
return to full health. It would have a possible negative impact on other
employees. Of course, these are all matters of judgement. There can never be a
100% guarantee in such matters. There was no advice in favour of a return to
work on other sites. Dr Crowle did canvas the pros and cons of other sites but
6 Decision at [53]-[58]
7 Decision at [60]
[2015] FWCFB 1889
6
did not recommend in favour of the University of Sydney or any other
alternative site.
(d) Section 346 and s.347 of the FW Act provide protections for the role of
union delegate. This is not a general protections case. However, Clause 16.1(d)
of the Agreement is relevant, in my view, and should be taken into account. I
do not find, on a formal basis, that there has been a breach of that clause. I do
not believe that is necessary.
I find, however, that Mr Genovese has been treated differently to other
employees as a result of his role as union delegate. I will not speculate as to the
reason for this.
Mr Coleman admitted that he had not been personally involved in the return to
work processes of other employees (See [48] above).
The evidence was that Lend Lease had detailed policies and procedures to deal
with these issues. It had specialist, experienced staff to deal with them, as one
would expect in a large professional employer. There was no evidence that the
usual practices had been departed from in other cases.
I agree with Mr Dalton that clause 16 does not give union delegates special
privileges but it does emphasise that they must be treated fairly. The fact that
they are not treated in the same way as other employees is a factor that the
Commission is entitled to take into account in the exercise of its judgment.
(e) A return to work at the University of Sydney project is relatively short term
and clearly does not involve a role comparable to the role that Lend Lease has
accepted for Mr Genovese over many years. In the absence of professional
advice that this should occur, there is disadvantage to Mr Genovese even with
the resolution of the differential wage issue. Another dispute is likely to arise,
in my view.
(f) There is no evidence that a return to work at Barangaroo will have a
negative effect on industrial harmony on the site.”
Submissions
[13] Lend Lease submitted that the Decision was attended by appealable error in five
respects. First, Lend Lease submitted that the Deputy President erred in characterising the
issue before him as one involving simply a determination of an appropriate outcome, with the
Deputy President thereby stepping into the shoes of the employer and making a choice
between two alternative outcomes. Absent a finding that Lend Lease’s decision to return Mr
Genovese to work at the Nanoscience project was inconsistent with its obligations under the
Agreement, the Deputy President should have determined the matter in accordance with the
principle stated in Australian Federated Union of Locomotive Enginemen v State Rail
Authority (NSW)8 (XPT Case) and affirmed in CFMEU v HWE Mining Pty Ltd9, namely that
8 (1984) 295 CAR 188
9 (2011) 214 IR 194
[2015] FWCFB 1889
7
the Commission should not interfere with the right of an employer to lawfully manage its own
business unless injustice and unreasonableness (which included effects of health and safety)
to employees resulted. No finding in accordance with this principle was made by the Deputy
President.
[14] Secondly, Lend Lease submitted that the Deputy President failed to consider the
evidence of Mr Coleman and evaluate his reasoning, and in particular did not engage with the
task of assessing whether the judgment exercised by Mr Coleman was logical, responsible and
reasonable, notwithstanding that at paragraph [63] of the Decision the integrity of Mr
Coleman and the veracity of his evidence was accepted. That evidence articulated the basis of
Mr Coleman’s concerns about Mr Genovese returning to work at Barangaroo by reference to
the size and scale of works there, the number of employees and subcontractors engaged, the
level of public and media scrutiny, the practical difficulties in managing or confining Mr
Genovese’s role to reduce the risks to his health to an acceptable level, and his own
observations that Mr Genovese remained in a fragile emotional state. These issues had not
adequately been addressed by Dr Chandler, Dr Paisley, Dr Crowle or Ms Bagia.
[15] Thirdly, the Deputy President’s conclusion that Lend Lease had departed from its
policies and procedures and had not followed to completion all steps in the return to work
process was not supported by any factual finding, and there was no evidence to support it.
Fourthly, in the absence of any finding that Lend Lease had breached clause 16.1(d) of the
Agreement, there was no basis for the Deputy President stating that clause 16.1(d) was
“relevant”, and the finding that Mr Genovese had been treated “differently” was without
meaning or content because his position was unique.
[16] Finally, it was submitted that the Decision and Order were made in excess of
jurisdiction and without power. By virtue of s.29(2)(b) of the FW Act, the dispute resolution
procedure in cl.19 of the Agreement was subject to applicable State OHS laws, relevantly the
Work Health and Safety Act 2011 (NSW) (WHS Act) and the Workplace Injury Management
and Workers’ Compensation Act 1998 (NSW) (WIMWC Act). Section 19(1) of the WHS Act
imposed a primary obligation to ensure, so far as was reasonably practicable, the health and
safety of workers at the workplace, and Part 5 Division 5 of the WHS Act contained a process
to resolve disputes about that primary obligation. Sections 46-48 of the WIMWC Act
contained relevant obligations upon employers and employees concerning the return to work
of injured workers, and ss.305-310 of that Act established procedures to resolve disputes
about return to work obligations. The relevant obligations under the WIMWC Act applied to
any “injured worker” being an employee who had received a workplace injury, defined as an
injury to a worker in respect of which compensation was or might be payable under the
WIMWC Act. There was evidence that Mr Genovese’s illness was substantially caused by
work, and therefore the WIMWC Act applied. The Decision and Order were made in excess
of jurisdiction and were beyond power because they were made without reference to and
without consideration of the identified obligations in the WHS Act and the WIMWC Act.
Because the Deputy President decided the matter simply on the basis of what was appropriate
and without consideration of the identified obligations under the WHS Act and the WIMWC
Act, the arbitration was not consistent with and therefore not subject to State OHS laws. This
last ground of error was not raised in the notice of appeal, and Lend Lease sought leave to
amend its appeal notice to add this ground. We grant such leave.
[17] Lend Lease submitted that permission to appeal should be granted because of the
significance of the dispute in the context of such a large construction project, the importance
[2015] FWCFB 1889
8
of the questions raised concerning managerial prerogative and the interaction between the
Commission’s disputes resolution powers under federal industrial instruments and State OHS
laws, and the nature and the substance of the errors identified.
[18] The CFMEU, on Mr Genovese’s behalf, submitted that:
(1) The XPT Case was not referred to by Lend Lease in the hearing at first
instance, which explains why it was not referred to in the Decision. In any
event, as disclosed by paragraph [61] of the Decision, the Deputy President
determined the matter by reference to a test of what was fair and reasonable,
which was not inconsistent with the principle stated in the XPT Case. The
Deputy President found, in substance, that Mr Genovese had not been treated
fairly. That was sufficient for the purposes of the principle in the XPT Case.
Having found unfairness, it was not necessary for the Deputy President to
make a separate finding about the reasonableness of Mr Coleman’s decision.
(2) The fact of Mr Coleman’s personal involvement in the process of Mr
Genovese’s return to work was a departure from policy and procedure, and
supported the Deputy President’s finding in paragraphs [61] and [64] of the
Decision that there had been a departure from policy and procedure and a
failure to follow the process to its conclusion.
(3) In relation to clause 16(1)(d), the Commission as an arbitral body was not
empowered to make a finding that the provision had been breached, since this
would constitute an impermissible exercise of judicial power. However the
Deputy President was entitled to treat clause 16(1)(d) as relevant to his inquiry
into the question of fairness for the purpose of determining what rights should
be created.
(4) Lend Lease’s jurisdictional submission (which was not raised at first instance)
was of little merit. A similar point was considered and rejected in the Full
Bench decision in Master Builders Australia Limited.10 In that decision, the
Full Bench had determined that a provision of a modern award which
purported to diminish a right or obligation under a State OHS law was of no
legal effect, but pointed to the Explanatory Memorandum to the Fair Work Bill
2008 as demonstrating that a modern award provision could supplement rights
and obligation under such laws. The disputes resolution procedure in cl.19 of
the Agreement supplemented rather than diminished rights and obligations
under the WHS Act and the WIMWC Act. In respect of the WIMWC Act, the
obligations concerning injury management plans in that Act only applied to
such plans where they were prepared by an employer’s insurer. That was not
relevant here.
(5) Permission to appeal should be refused, or in the alternative the appeal should
be dismissed.
Consideration
10 [2012] FWAFB 10080
[2015] FWCFB 1889
9
Arbitration power under the Agreement
[19] It is convenient to commence our consideration of Lend Lease’s appeal by
ascertaining the nature and scope of the arbitration power that was exercised by the Deputy
President under cl.19 of the Agreement.
[20] Section 595(3) of the FW Act provides that the Commission “may deal with a dispute
by arbitration (including by making any orders it considers appropriate) only if the FWC is
expressly authorised to do so under or in accordance with another provision of this Act”. One
express source of such an arbitration power is contained in Div.2 of Pt.6-2 of the FW Act.
Section 738(b) provides (relevantly) that the Division applies if “an enterprise agreement
includes a term that provides a procedure for dealing with disputes, including a term referred
to in subsection 186(6)”. In relation to such a term, s.739(4) provides: “If, in accordance with
the term, the parties have agreed that the FWC may arbitrate (however described) the
dispute, the FWC may do so”. However, s.739(5) imposes a limitation upon this power of
arbitration by providing: “Despite subsection (4), the FWC must not make a decision that is
inconsistent with this Act, or a fair work instrument that applies to the parties”. One effect of
the limitation in s.739(5) is that, in arbitrating a dispute in accordance with the disputes
resolution procedure in an enterprise agreement, the Commission may not make a decision
which is inconsistent with any provision of the enterprise agreement. Further, s.739(3)
provides that “In dealing with a dispute, the FWC must not exercise any powers limited by the
term”, so that if, for example, any arbitration power in the disputes resolution procedure of an
enterprise agreement may be exercised only in relation to certain specified categories of
dispute (such as disputes about the application of the agreement or the NES), the Commission
is not permitted to arbitrate any dispute falling outside these categories.
[21] The disputes resolution procedure in the Agreement is contained in clause 19,
Conflict Resolution, which relevantly provides:
“19.1 The Parties recognise that one of the aims of the Agreement is to eliminate lost
time in the event of a dispute and to achieve prompt resolution. The most effective
procedure is for the responsibility for resolution to remain as close to the source of the
dispute as possible. To this end, the following processes are agreed:
(a) Disputes Procedure
In the event of a dispute occurring, the following procedure will be adopted:
(i) Discussion between those directly affected;
(ii) Discussion on the project between the site management and the Employee
affected or a representative nominated by the employee (including Union
delegate);
(iii) Discussion between senior Company management and the Employee
affected, or if nominated by the Employee their Representative or appropriate
union official;
[2015] FWCFB 1889
10
(iv) The relevant Union official commits to make him/herself available to be
involved at any stage of the procedure as required, or in respect of any
potential dispute. The Company agrees to facilitating access to the project for
the relevant Union official to represent Employees under this procedure subject
to the Union official complying with all site rules and reasonable requests and
reasonable directions of site management.
A dispute will not be referred to the next level of the above procedure until a genuine
attempt to resolve the matter has been made at the appropriate level.
(b) Reference to the relevant State Board or Panel
. . .
(c) Reference to Fair Work Australia
A dispute may be referred to FWA for conciliation and if required, arbitration, in
either of the following circumstances:
(i) If the dispute still exists after the above disputes procedure has been carried
out, the dispute may be referred by any of the parties to the dispute to FWA; or
(ii) If any party to the dispute refuses or fails to follow any step of the above
disputes procedure the non breaching party will not be obligated to continue
through the remaining steps and may immediately refer the matter to FWA.
(d) Notice of Disputes
Should a dispute arise and it does not appear to be one which can be settled
immediately, the party raising the matter will notify the other party or parties by
telephone within 48 hours of the dispute arising and confirm it in writing.”
[22] No relevant limitation on the scope of the Commission’s power to arbitrate a dispute
under clause 19 may be identified in the terms of clause 19 itself. It is not necessary to explore
the outer limits of what might constitute a “dispute” for the purpose of clause 19, since there
was no issue that the dispute concerning Mr Genovese’s return to work was one to which
clause 19 applied. We consider that an unrestricted power to arbitrate a dispute involves the
conferral on the decision-maker of a broad discretion. Lend Lease accepted in its submissions
that the power exercised by the Deputy President was discretionary in nature and that (leaving
aside for present purposes Lend Lease’s jurisdictional ground of appeal based on alleged
inconsistency with State OHS laws), it was necessary for it to demonstrate error of the type
identified in House v The King.11
[23] As earlier stated, the relevant effect of s.739(5) was that, in exercising his
discretionary arbitral power under cl.19, the Deputy President was not permitted to make a
decision which was inconsistent with any provision of the Agreement. Three provisions of the
Agreement were relevant to the dispute involving Mr Genovese’s return to work. The first
was clause 14, which deals with “Environmental Health and Safety”. Subclause (c) of clause
14 provides:
11 (1936) 55 CLR 499 at 504-5
[2015] FWCFB 1889
11
“(c) Organising work so that the health and safety of all Employees and protection of
the environment are recognised as being of paramount importance and is therefore
integrated into the Environmental Health and Safety Plan”.
[24] Second, clause 16 of the Agreement concerns “Employee Representatives”, and
specifies the rights of such representatives. Subclause 16.1(d) provides that elected employee
representatives will “Be treated fairly and to perform their role as Employee Representative
without any discrimination in their employment”. Third, Appendix E of the Agreement sets
out Lend Lease’s Environmental, Health and Safety Policy, and provides among other things
as follows:
“We are committed to eliminating harm to people and minimising any environmental
impact and will comply with all environmental work and health and safety legislation,
regulation and other requirements as a minimum. We will move well beyond
compliance to get new benchmarks in environmental, health and safety management
wherever possible.”
[25] Lend Lease did not contend that the Decision or Order were inconsistent with these
provisions of the Agreement or with any other provision of the Agreement. Accordingly,
subject to the determination of Lend Lease’s jurisdictional point, the relevant question
remains whether the Deputy President erred in the exercise of his discretion.
XPT Case
[26] The principle stated in the XPT Case was as follows:
“It seems to us that the proper test to be applied and which has been applied for many
years by the Commission is for the Commission to examine all the facts and not to
interfere with the right of an employer to manage his own business unless he is seeking
from the employees something which is unjust or unreasonable. The test of injustice or
unreasonableness would embrace matters of safety and health because a requirement
by an employer for an employee to perform work which was unsafe or might damage
the health of the employee would be both unjust and unreasonable.”12
[27] It may be accepted that the above principle is one which should be taken into account
and given significant weight in the exercise of an arbitral discretion concerning whether the
Commission should intervene in relation to a lawful business management decision by an
employer. However to elevate the XPT Case principle into an immutable rule applicable to
any employer decision is to overstate the effect of the principle. In this case, the question of
Mr Genovese’s fitness to return to work at Barangaroo was, we consider, primarily a medical
one and for that reason any management decision concerning that matter did not readily fall
within the ordinary run of business management decisions about which the XPT Case
principle was concerned. The opinion on that question of qualified medical practitioners was
inevitably a matter which would have to be given significant weight.
[28] Although the Deputy President was not expressly taken by Lend Lease to the XPT
Case or any subsequent decision which affirmed or applied the principle stated in that case,
nonetheless he recognised that the management decision of Mr Coleman not to allow Mr
12 (1984) 295 CAR 188 at 191
[2015] FWCFB 1889
12
Genovese to return to work at Barangaroo should not lightly be interfered with when he
referred to there being a “high bar for the Commission to intervene to overturn the decision of
management in a case such as this”.13 That, in substance, afforded appropriate weight to the
XPT Case principle in the circumstances. Nonetheless it is clear from the Deputy President’s
reasoning in the Decision that he regarded the weight of the medical evidence as being such
as to justify intervention in the matter against the decision taken by Mr Coleman.
[29] We consider that this approach was reasonably open to the Deputy President. The
medical evidence before him, which was not contested, all went one way. Dr Chalmers, Dr
Paisley and Dr Crowle all expressed the view that Mr Genovese was fit to return to work at
Barangaroo on a graduated basis. This view was supported by Ms Bagia, who although not a
medical practitioner had demonstrated expertise and experience in the area of workplace
injury management and had been nominated by Lend Lease to prepare a return to work
program for Mr Genovese. Not only, as the Deputy President found, was there no medical or
expert opinion in favour of Mr Genovese returning to work at the Nanoscience project, Dr
Paisley had expressed the view that a return to work at a site other than Barangaroo would
pose a risk to Mr Genovese’s mental health.
[30] We therefore reject Lend Lease’s submission that the Deputy President erred in the
exercise of his discretion by failing to take into account the XPT Case principle.
Consideration of Mr Coleman’s evidence
[31] For similar reasons, we reject Lend Lease’s submission that the Deputy President
erred in failing to consider and evaluate the evidence of Mr Coleman. As we have earlier
recited, the Deputy President at paragraph [63] of the Decision accepted the integrity and
veracity of Mr Coleman’s evidence, as well as his seniority as a manager and the extent of his
experience in the construction industry. In doing so, we consider that the Deputy President
accepted that Mr Coleman’s evidence concerning the decision he had taken and the reasons
for it was given in good faith and was to be accorded weight. However, it overstates the
matter to submit that the Deputy President thereby “accepted” Mr Coleman’s evidence. The
gravamen of Mr Coleman’s evidence - that is, his concern that the nature of the Barangaroo
site would detrimentally affect Mr Genovese’s level of workplace stress and endanger a full
and durable recovery - was specifically considered by the Deputy President in paragraph
[64](c) of the Decision, but it is clear that the Deputy President preferred the “medical and
professional advice in favour of a return to work at Barangaroo”14 and the lack of any such
advice in favour of a return to work at any other site.15 Such a conclusion was reasonably
available.
Departure from policies and procedures
[32] Read in the context of paragraph [64] as a whole, the Deputy President’s finding that,
in dealing with Mr Genovese’s return to work, Lend Lease had departed from its own policies
and procedures appears to be, in substance, a conclusion that the decision-making role of Mr
Coleman in the process in lieu of its own “specialist, experienced staff” represented a
13 Decision at [62]
14 Decision at [64](b)
15 Decision at [64](c)
[2015] FWCFB 1889
13
departure from the “usual practices”.16 That conclusion was well supported by the evidence.
Mr Coleman’s lack of any prior involvement in the return to work process of any other
employees, referred to by the Deputy President in paragraph [64](d) of the Decision, was
conceded by him in cross-examination.17 Lend Lease had a head of injury management,
Michael Stoddart, who was usually involved in making decisions in relation to return to work
plans18, but in this case he was not the decision-maker and his recommendation that Mr
Genovese should return to work at Barangaroo was overridden.19 The process it followed in
Mr Genovese’s case whereby it selected Dr Crowle and Ms Bagia to provide expert advice
concerning Mr Genovese’s return to work but then failed to heed that advice was also clearly
unusual. We do not consider that the Deputy President erred in finding that Lend Lease
departed from its own policies and procedures.
Differential treatment of Mr Genovese
[33] For the reasons we have just stated, there was a sound basis for the Deputy President
to conclude, as he did in paragraph [64](d) of the Decision, that Mr Genovese had been
treated differently. The Deputy President further found that this was a result of his role as a
union delegate. Lend Lease does not challenge the correctness of this finding in its appeal, but
contends that the Deputy President erred by treating clause 16.1(d) of the Agreement as
relevant in circumstances where he made no finding of any breach of that clause, and that the
finding that Mr Genovese was treated differently had no meaning or content because his
position was unique.
[34] We do not agree. Clause 16.1(d) of the Agreement, which we have earlier quoted,
required union delegates such as Mr Genovese to be treated fairly and without discrimination.
It was clearly relevant in circumstances where Mr Genovese had been found to be subject to
differential treatment. While the Deputy President would have been entitled to express the
opinion in the course of exercising his arbitral function that Lend Lease had contravened
clause 16.1(d), the fact that he decided to refrain from doing so did not have the effect of
rendering clause 16.1(d) irrelevant. We consider that the fact that Mr Genovese was subject to
differential treatment when, consistent with medical advice, he sought to return to his work as
the delegate at Barangaroo was a significant matter which the Deputy President was entitled
to take into account.
Jurisdictional issue - interaction with State OHS laws
[35] Section 29 of the FW Act deals with the interaction of, relevantly, enterprise
agreements with State and Territory laws as follows:
29 Interaction of modern awards and enterprise agreements with State and
Territory laws
(1) A modern award or enterprise agreement prevails over a law of a State or
Territory, to the extent of any inconsistency.
16 See Decision at [64](d)
17 Transcript, 2 December 2014, PN426-432
18Transcript, 2 December 2014, PN699-700
19 Transcript, 2 December 2014, PN697
[2015] FWCFB 1889
14
(2) Despite subsection (1), a term of a modern award or enterprise agreement applies
subject to the following:
(a) any law covered by subsection 27(1A);
(b) any law of a State or Territory so far as it is covered by paragraph 27(1)(b), (c) or
(d).
(3) Despite subsection (2), a term of a modern award or enterprise agreement does not
apply subject to a law of a State or Territory that is prescribed by the regulations as a
law to which modern awards and enterprise agreements are not subject.
[36] In relation to s.29(2)(b), s.27(1)(c) covers any State or Territory law which “deals with
any non-excluded matters”. Under s.27(2), the “non-excluded matters” referred to include, in
paragraph (b), workers compensation, and paragraph (c), occupational health and safety. No
relevant regulation has been made pursuant to s.29(3) to displace the operation of s.29(2)(b)
in respect to State and Territory laws dealing with workers compensation or occupational
health and safety. Therefore, to the extent that there is any inconsistency between an
enterprise agreement and any State or Territory law dealing with workers compensation or
occupational health and safety, the State or Territory law prevails and the inconsistent
provision of the enterprise agreement is rendered of no legal effect.20 The Explanatory
Memorandum for the Fair Work Bill 2008 explained that the intended effect of s.29(2) was
(relevantly) that an enterprise agreement “cannot diminish, but may supplement, rights and
obligations under these laws”. This is consistent with the ordinary meaning of s.29(2).
[37] Lend Lease’s jurisdictional challenge to the Decision alleged inconsistency with two
NSW statutes, the WHS Act and the WIMWC Act. The WHS Act is plainly a State law which
deals with occupational health and safety, and the CFMEU did not submit otherwise. The
WIMWC Act deals with both workers compensation and occupational health and safety, and
again there was no submission to the contrary. Therefore, by force of s.29(2)(b), the
Agreement applies subject to the WHS Act and the WIMWC Act.
[38] The nature and effect of the inconsistency alleged by Lend Lease to exist between the
Agreement, the WHS Act and/or the WIMWC Act was somewhat elusive. It was not
suggested that, because of any alleged inconsistency, there was no legal capacity at all for the
Commission to arbitrate the dispute concerning Mr Genovese under clause 19 of the
Agreement. Lend Lease appears to have accepted that there was jurisdiction to deal with the
dispute under clause 19. Rather, Lend Lease’s contention was that clause 19 did not authorise
the Commission to arbitrate the dispute “simply by reference to what the Commission
regarded as appropriate in the circumstances”.21 That proposition appeared to suggest that
there was some constraint upon the conduct of the arbitration by the Deputy President under
clause 19 of the Agreement by virtue of that provision being subject to the WHS Act and the
WIMWC Act.
[39] In relation to the WHS Act, Lend Lease relied upon s.19(1), which relevantly imposes
upon Lend Lease, as a person conducting a business or undertaking, a primary obligation to
ensure, so far as is reasonably practicable, the health and safety of workers at its workplace.
20 See Armacell Australia Pty Ltd and others [2010] FWAFB 9985 at [30]
21 Lend Lease’s written appeal submissions, paragraph 40.
[2015] FWCFB 1889
15
Lend Lease also identified Div.5 of Pt.5 (ss.80-82) of the WHS Act, which establishes a
resolution process for health and safety issues arising at a workplace, as relevant, and
contended that disputes about the primary obligation in s.19(1) were amenable to this
resolution process. It is important to observe that Lend Lease did not submit that the mere
existence of the resolution process for health and safety issues in Div.5 of Pt.5 of the WHS
Act gave rise to an inconsistency with the different dispute resolution procedure in clause 19
of the Agreement insofar as health and safety disputes were concerned such that s.29(2)(b) of
the FW Act operated to render cl.19 legally ineffective in relation to disputes of that nature.
Instead, Lend Lease submitted that the outcome arbitrated by the Deputy President involved
an excess of jurisdiction because it was not reached by reference to the primary health and
safety obligation under s.19(1) of the WHS Act.
[40] Lend Lease did not in its appeal submissions, as we understood them, contend that
there was any actual inconsistency between the Decision and Order made pursuant to clause
19 of the Agreement and the primary obligation in s.19(1) of the WHS Act in the sense that
the Decision and Order conflicted with or diminished Lend Lease’s obligation under s.19(1).
Indeed, to the extent that the Decision made it clear that the outcome determined by the
Deputy President was to a substantial degree based on the medical and professional advice of
Dr Chandler, Dr Paisley, Dr Crowle and Ms Bagia that Mr Genovese was fit for a graduated
return to work at Barangaroo, and the lack of any such advice in favour of a return to work
anywhere else, we consider that it was consistent with Lend Lease’s obligation under s.19(1)
to ensure so far as practicable Mr Genovese’s health and safety at the workplace. In the
absence of any identified inconsistency, we do not consider that Lend Lease’s submission in
the terms that it was put raises in substance a jurisdictional issue at all. It really only amounts
to a proposition that the Deputy President erred in the exercise of his discretion by not taking
into account s.19(1) of the WHS Act. However, given that Lend Lease did not submit at first
instance that s.19(1) should be taken into account in the decision to be made, or even draw the
Deputy President’s attention to that provision, no error can arise in this respect.
[41] In relation to the WIMWC Act, Lend Lease pointed to Div.3 of Ch.7 (ss.305-310) of
that Act which, as stated in s.305, “applies in respect of a dispute that concerns a failure by a
party to the dispute to comply with an obligation imposed by or under Chapter 3”. Division 3
of Ch.7 sets out a procedure for the resolution of such disputes by the Workers Compensation
Commission established by the WIMWC Act. Provisions under Ch.3 of the WIMWC Act
which might give rise to a dispute to which Div.3 of Ch.7 applied which were identified by
Lend Lease as relevant to Mr Genovese’s case were s.46, which deals with an employer’s
injury management plan obligations, s.47, which deals with a worker’s injury management
plan obligations, and s.48, which deals with a worker’s return to work obligation.
[42] Again, it was not contended by Lend Lease that the mere existence of this dispute
resolution procedure meant that there was no jurisdiction for the Commission to arbitrate Mr
Genovese’s dispute under clause 19 of the Agreement at all, but only that an arbitration which
did not resolve the dispute by reference to the content of the return to work obligations
imposed by the WIMWC Act was in excess of jurisdiction. For the same reasons as already
stated in relation to the WHS Act point, we do not consider this submission raises any real
jurisdictional issue. No actual inconsistency between the Decision and Order made pursuant
to clause 19 of the Agreement and the obligations imposed by ss.46-48 of the WIMWC Act
was identified by Lend Lease, nor do we consider that there was any such inconsistency;
accordingly no issue under s.29(2)(b) of the FW Act arises. Nor, given that neither party
suggested at first instance that those obligations should be taken into account such as to
[2015] FWCFB 1889
16
support a particular outcome, can it be suggested that there was any error in the Deputy
President’s exercise of the discretion in this connection.
[43] In any event, we do not consider that the identified provisions of the WIMWC Act had
any relevant application to Mr Genovese’s dispute. Sections 46 and 47 concern the
employer’s and the injured worker’s obligations under an “injury management plan”. As s.45
of the WIMWC Act makes clear, an “injury management plan” for the purposes of ss.46 and
47 is one established by the employer’s workers compensation insurer. There was no question
of an insurer preparing an injury management plan for Mr Genovese because, apparently, he
never made a workers’ compensation claim in the first place, and there was nothing in the
evidence to suggest that Lend Lease’s insurer had any role in the return to work process for
Mr Genovese. In relation to s.48, there was never any suggestion that Mr Genovese had failed
to comply with his obligation (under s.48(1)) to “make reasonable efforts to return to work in
suitable employment or pre-injury employment”; indeed the evidence demonstrated that it was
Mr Genovese’s agitation to return to work at Barangaroo which gave rise to the dispute.
Therefore the dispute before the Deputy President simply did not concern any of the matters
dealt with by ss.46-48A of the WIMWC Act, and consequently there could be no
inconsistency to which s.29(2)(b) of the FW Act applied.
[44] We therefore reject the submission that the Decision was made in excess of
jurisdiction or that the Order was beyond power.
Conclusion
[45] Lend Lease has not succeeded in establishing any appealable error in the Decision or
Order. We do not consider that there are any public interest grounds requiring the grant of
permission to appeal under s.604(2) of the FW Act, and we do not consider that there is any
discretionary ground justifying the grant of permission to appeal.
[46] Accordingly permission to appeal is refused.
VICE PRESIDENT
Appearances:
F. Parry QC and R. Dalton of counsel, for the Appellant.
I. Latham of counsel with T. McCauley, solicitor for the Respondent.
Hearing details:
2015.
Sydney:
2 February.
Printed by authority of the Commonwealth Government Printer
Price code C, PR562182
OF THE FAIR WORK MISSION THE
