Fair Work Act 2009
s.604 - Appeal of decisions

Appeal against decision [2017] FWC 2298 of Deputy President Clancy at Melbourne on 27 April 2017 in matter number C2016/6167 - construction of agreement - whether permission to appeal required – whether agreement is ambiguous - appeal upheld - matter remitted for rehearing

Introduction

[1] This is an appeal by EnergyAustralia Yallourn Pty Ltd (EnergyAustralia) from a decision of Deputy President Clancy 1 concerning an application by the Construction, Forestry, Mining and Energy Union (CFMEU) under s.739 of the Fair Work Act 2009 (Act) for the Commission to deal with a dispute under the EnergyAustralia Yallourn Enterprise Agreement 2013 (Agreement).

[2] The dispute centred on the interpretation of clause 32.17 of the Agreement, which deals with ‘cross-stage training arrangements’, and the application of that clause to Mr Ashley Schoer, an employee whose employment is covered by the Agreement. Cross-stage training enables employees to work on both ‘stages’ at the Yallourn Power Station; of the four coal fired generators at the Yallourn facility, units 1 and 2 are known as ‘Stage 1’, and units 3 and 4 are known as ‘Stage 2’. 2

[3] The focus of the dispute was the third paragraph of clause 32.17, and in particular the meaning of the words ‘the structured training course’. These words are not defined. The third paragraph of clause 32.17 reads as follows:

“Individuals moving to an AUC or UC level who have not previously completed the structured training course will be provided a structured training course. The program will be a two week course run as 4 x 9 hour days per week on day work.”

[4] EnergyAustralia contended that ‘the structured training course’ refers to a variety of different training ‘pathways’, and that Mr Schoer had previously completed ‘the structured training course’ by undertaking certain training in 2003 and 2012. The CFMEU’s position was that ‘the structured training course’ means the two week course referred to in the last sentence of the third paragraph, and that Mr Schoer is entitled to undergo this training course.

[5] The Deputy President decided that the question he was required to determine was ‘whether, in providing training to Mr Schoer for the purpose of him completing cross-stage training, EnergyAustralia was permitted to depart from the two week course run as 4 x 9 hour days per week outlined in clause 32.17’. 3

[6] The Deputy President decided that the answer to the question as framed by him was ‘no’. 4 He concluded that ‘the Agreement has a plain meaning and requires EnergyAustralia to provide Mr Schoer with a two week cross-stage training course run as 4 x 9 hours per day on day work, together with the consolidation Clause 32.17 requires upon its completion.’5

[7] We note that, following the filing of written submissions, and shortly before the hearing of this matter, a Full Bench of the Commission handed down its decision in AMWU v Berri Pty Ltd 6 (Berri). That decision dealt with principles of interpretation relevant to enterprise agreements, and expanded upon the summary of principles set out in AMIEU v The Golden Cockerel Pty Ltd7 (Golden Cockerel). We drew the decision in Berri to the attention of the parties prior to the hearing of the appeal.

Permission to Appeal

[8] Generally, an appeal of a decision is not as of right and permission to appeal must first be obtained. 8 Subsection 604(2) of the Act requires the Commission to grant permission to appeal if satisfied that it is ‘in the public interest to do so’. The task of assessing whether the public interest test is met is a discretionary one involving a broad value judgment.9

[9] Other than the special case in s.604(2), the grounds for granting permission to appeal are not specified. Considerations that would usually justify the grant of permission to appeal include that the decision is attended with sufficient doubt to warrant its reconsideration, or that substantial injustice may result if leave is refused. 10

[10] EnergyAustralia contends that in the present case, permission to appeal is not required. It says that an appeal lies as of right, pursuant to the terms of the Agreement. 11 Clause 28.3 provides:

“ (a) A party may seek an appeal of the FWC’s decision within fourteen days of

receipt of decision or the provision of reasons for decision whichever
comes later.

(b) An application for an appeal of the FWC’s decision will be provided to the Parties and the FWC in writing detailing the grounds for appeal.

(c) Unless agreed otherwise by the parties to the dispute, the appeal will be conducted according to the principles applying to an appeal under the Act, including where a stay is sought.

(d) The parties to the dispute and the appeal panel of the FWC will use their best endeavours to ensure that the appeal process is expedited.

(e) The decision of the appeal panel of the FWC is final, subject to any other legal right of appeal that might exist.” 12

[11] The CFMEU contends that this clause confers not an independent right to appeal, but merely a right to seek – ‘to request’ or ‘attempt to obtain’ - an appeal. 13 It submits that the clause does not employ the word ‘right’,14 and that it does not otherwise bear out the existence of such a right.

[12] We agree with the CFMEU’s submission. In our view, clause 28.3 does not use language that connotes the existence of an independent right to appeal under the Agreement, unconstrained by s.604. The wording differs from that of dispute settlement procedures found in some other enterprise agreements where the Commission has found those procedures conferred an independent right of appeal. 15 Clause 28.3 appears rather to contemplate that s.604 will apply. ‘Seeking’ an appeal is compatible with the concept of a party requiring the permission of the Commission in order to appeal a decision. Further, clause 28.3(c) confirms that an appeal will be conducted ‘according to the principles applying to an appeal under the Act.’ We consider that such principles include those concerning permission to appeal.

[13] Although clause 28.3 does not confer an independent right of appeal, it has work to do. First, it confirms that the ordinary appeal rights under the Act are available. It is open to the parties to an enterprise agreement, in conferring a power of private arbitration on the Commission, to preclude or modify those rights. Second, certain modifications are made in relation to the timeframe for making an appeal: appeals are to be filed within 14 days, rather than 21 days; and the parties, as well as the Commission, will endeavour to expedite the appeal process (see sub-clause (d)).

[14] As there is no automatic right of appeal, EnergyAustralia must satisfy the requirements in s.604 of the Act.

[15] The CFMEU contends that permission to appeal should not be granted, on the bases that the grounds of appeal were weak; the decision is consistent with established principle; the decision and any appeal may become moot given that the Agreement is nearing its nominal expiry date; and that few employees are affected by the decision – only one, according to the employer. It further says that no issues of broader significance arise. 16

[16] We have decided to grant permission to appeal. As discussed below, we have concluded that EnergyAustralia has established an arguable case of error in relation to the decision the subject of the appeal, such as to warrant the granting of permission to appeal. Further, in relation to the application of principle, the decision of the Full Bench in Berri is relevant to the interpretation of the Agreement; this decision was handed down after the Deputy President’s decision. We discuss the significance of the decision later in these reasons.

Grounds of appeal

[17] The approach of a Full Bench to the determination of an appeal depends on the nature of the decision below. In the present case, the Deputy President was resolving a dispute that involved the interpretation of an enterprise agreement. This task of determining the proper interpretation of the Agreement did not involve the exercise of discretion. Accordingly, the Full Bench must determine whether the interpretation of the Agreement adopted by the Deputy President was correct. 17 Other decisions made during the course of hearing and determining the matter at first instance might involve the exercise of discretion. Such decisions are appealable on the bases identified in House v The King.18

[18] EnergyAustralia advances 8 grounds of appeal. We do not reproduce them in this decision. It is sufficient to summarise them.

[19] Ground 1 concerned permission to appeal, with which we have dealt.

[20] Grounds 2, 3 and 7 were grouped together in EnergyAustralia’s Outline of Submission, and related to contentions that the Deputy President erred in ruling inadmissible certain evidence as to the industrial context and purpose of the relevant provisions of the Agreement.

[21] Ground 4 contended that the Deputy President erred by refusing to admit evidence going to the cross-stage training provided by EnergyAustralia to Mr Schoer.

[22] Ground 5 intersects with grounds 3 and 4. EnergyAustralia claimed that the refusal to admit evidence, as contended in grounds 3 and 4, amounted to a denial of natural justice, on the basis that the inadmissibility of the evidence in question was neither contended for by the parties, nor foreshadowed by the Commission.

[23] Ground 6 concerned the Deputy President’s construction of the Agreement, and in particular the meaning he gives to the expression ‘the structured training course’ in the first sentence of the third paragraph of clause 32.17.

[24] Ground 8 concerns the Deputy President’s application of his conclusion about the construction of clause 32.17 to the circumstances of Mr Schoer, namely that Mr Schoer had not completed ‘the structured training course’.

[25] We address the grounds of appeal in the order in which they were advanced.

Alleged decision not to admit evidence as to the industrial context and purpose

[26] We deal first with the grounds that are concerned with the Deputy President’s alleged refusal to admit evidence as to the industrial context and purpose of clause 32.17. It is convenient to set out grounds 2, 3 and 7:

“2. The learned Deputy President acted on a wrong principle in relation to the interpretation of enterprise agreements, by ruling inadmissible evidence of the industrial context of the Agreement, and the industrial purpose of clause 32.17 and the objects to be achieved by it, in construing the meaning of the Agreement. 19

3. The learned Deputy President erred by refusing to admit evidence going to:

a. the industrial context of clause 32.17, and the industrial purpose and objects to be achieved by it, including the history of cross-stage training provided by the Appellant to its employees prior to the making of the Agreement; 20

b. the surrounding circumstances of clause 32.17, including the Appellant's rejection during negotiation of the Agreement of the CFMEU's initial proposal that cross-stage training "will be provided to all Operations personnel in the AUC and UC ranks ... " (emphasis added). 21
…

7. Further and in the alternative, the learned Deputy President erred by failing to have regard to relevant matters in construing the Agreement and determining the dispute, being the evidence referred to in paragraphs 3 and 4 above.” 22

[27] In its contentions relating to these grounds of appeal, EnergyAustralia framed its argument by reference to the principles of interpretation that are applicable to enterprise agreements, including the summary of principles set out by the Full Bench in Golden Cockerel, and the authorities referred to in that decision. EnergyAustralia contended that the task of the Commission in construing enterprise agreements is to identify the objective meaning of the agreement, and that this requires the Commission to construe the words of the agreement having regard to its context. 23

[28] EnergyAustralia then addressed the scope of the concept of ‘context’. It contended that context is not confined to linguistic context, but includes the industrial context, purpose and objectives of the instrument. 24 Reliance was placed on the decision of Mortimer J in Polan v Goulbourn Valley Health25 (Polan), where her Honour summarised relevant principles of interpretation, and noted that “considerations of context include the wider industrial circumstances in which a particular agreement has been negotiated and concluded”.26

[29] EnergyAustralia also referred to the recent decision of the majority of the High Court in Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd 27(Ecosse), where Kiefel, Bell and Gordon JJ stated that the terms of a commercial contract are to be understood objectively, by what a reasonable businessperson would have understood them to mean, and that this requires a reasonable businessperson to be placed in the position of the parties. It is “from that perspective that the court considers the circumstances surrounding the contract and the commercial purpose and objects to be achieved by it.”28

[30] The question of what forms part of the context of a particular provision is important. The interpretation of an agreement must have regard to context. By contrast, the authorities indicate that it is only in connection with ambiguity in the text that the surrounding circumstances can be considered. 29

[31] In Golden Cockerel and Berri, the Full Bench considered the question of context in relation to the interpretation of enterprise agreements, in the light of previous authorities, including those concerning contracts at common law. In both decisions, the Full Bench stated that context might appear from the text of the agreement as a whole, the disputed provision’s place and arrangement in the agreement, and the legislative framework under which the agreement was made. 30 The examples cited in these decisions of what might constitute context are not in our view intended to be exclusive. However, each of the examples mentioned pertains to textual matters. This is compatible with the decision of French CJ, Nettle and Gordon JJ in Mount Bruce Mining Pty Limited v Wright Prospecting Pty Limited and Another,31 where their Honours state that the provisions of a contract are determined objectively, by reference to “text, context (the entire text of the contract as well as any contract, document or statutory provision referred to in the text of the contract) and purpose.” It would appear to us that the context of an instrument will usually be of a textual nature, and that context and surrounding circumstances are distinct concepts. We do not read the passages from Polan and Ecosse as merging them.

[32] We do not propose to delineate the bounds of what may constitute context, and precisely how this is to be distinguished from surrounding circumstances. It is not necessary for us to do so, for the reasons that follow.

[33] Energy Australia contended that evidence was led concerning matters that related either to context or surrounding circumstances (including evidence of the training that had been undertaken previously by Mr Schoer), and that the Deputy President was wrong to exclude and not have regard to it.

[34] EnergyAustralia set out in its submissions that which it contends were the industrial context, purpose and objects of clause 32.17. First, it noted that the Agreement introduced a new classification system whereby classifications PC1 to PC3 were replaced with classifications AUC and UC, and that arrangements were made for the transition of employees to the new classification. 32 This transition is referred to in the first paragraph of clause 32.17: ‘Individuals moving to an AUC or UC level …’

[35] We agree with EnergyAustralia that this is a point of context which is relevant to the interpretation of the Agreement. It informs the meaning of ‘the structured training course’. However, we consider that the Deputy President had regard to this contextual consideration. The entire clause was set out in the decision, and he specifically referred to new classification and transition arrangements 33.

[36] EnergyAustralia also refers to five head points, in respect of which evidence was led, of what it describes as context pertaining to clause 32.17. 34 We set this out in full as it assists in understanding EnergyAustralia’s concerns in this matter and our analysis of the grounds of appeal.

“The context included the following:

(a) by 2013 many Operators (previously classified as PC1-PC3, but under the Agreement to be classified in the AUC and UC classifications) had only become competent in one Stage;

(b) this was despite an expectation (reflected in the Agreement’s predecessors which were made in 2004 and 2008) that Operators would be able to work across both Stages;

(c) the Respondent and the Appellant expressly acknowledged as part of the 2013 Agreement negotiations that cross-stage training of Operators needed to be completed, so that Operators could be rostered across both Stages;

(d) some operators were already cross-stage trained, and did not require further cross-stage training; and

(e) prior to 5 December 2013 (when the Agreement commenced operation), there had been several pathways taken by Operators to become cross-stage trained. Those pathways to cross-stage training included:

(i) completion of the AUC course which involved training in both Stages: Justin Felsbourg, Peter Clark and Glen Gibson are examples of employees who completed the AUC course and then subsequently worked on both Stages without completing a further cross-stage course;

(ii) self-paced training: Adrian Klose (a witness called by the union) gave evidence regarding his self-paced training under a type of mentor system;

(iii) completion of a traineeship across both Stages: Dan Chapple was an example;

(iv) completion of a training course offered in 2012 on day work for three weeks amounting to 72 hours of theory and 36 hours of on the job training: Geoff Aitken, David Somerville, Rob McKenzie and Terry Fogarty were examples; and

(v) a one-on-one cross-stage training course that was provided to Mr Schoer in 2012.”

[37] EnergyAustralia contended that these matters relating to the history of cross-stage training are part of the industrial context, purpose and objects of clause 32.17. Being part of the context, they should have been considered. Alternatively, it contends that these matters go to the surrounding circumstances, in so far as they evidence objective background facts known to the parties; they are therefore relevant to the Commission’s role in assessing whether the Agreement is ambiguous and if so, in resolving the ambiguity. 35 We are inclined to view the matters above as relating to the surrounding circumstances, rather than context, however it is not necessary for us to decide this question.

[38] EnergyAustralia submits that the Deputy President had no regard to the matters referred to in [36] above, and that he expressly ruled this evidence inadmissible at [53] of his decision. 36

[39] We do not agree. At [53] of his decision, the Deputy President states:

“Notwithstanding the volume of evidence in this case concerning the nature and extent of the training Mr Schoer had undertaken and the circumstances surrounding it and Mr Hogarth’s evidence going to the surrounding circumstances of the Agreement and its negotiation, there is no basis for me to admit evidence of these matters to contradict the plain language of the Agreement. I draw on the fourth principle articulated in the Golden Cockerel in this regard because I have found Clause 32.17 has a plain meaning and there is no ambiguity.” (Emphasis added)

[40] In our view, this passage does not reflect a decision to refuse to admit the evidence. Rather, the highlighted sentence indicates that it is for the limited purpose of contradicting what the Deputy President considered to be the plain meaning that the evidence was not admitted. It is clear from the transcript that the evidence was heard. No submission was made by either party that it should not be admitted. There is nothing in the decision or the transcript that would suggest to us that the evidence in question was ruled inadmissible. The Deputy President’s observations above go only to the limitations on the purpose for which the evidence has been admitted.

[41] The next issue is whether the Deputy President had regard to the evidence.

[42] It is clear from the face of the Deputy President’s decision that he considered the evidence. At [48] of the decision the Deputy President states: “I consider the words of Clause 32.17 of the Agreement have a plain meaning and there is no ambiguity. Mr Hogarth’s evidence regarding the Agreement’s negotiation process and drafting does not persuade me otherwise”. It should be noted that Mr Hogarth’s evidence addressed the issues of training requirements for operations roles, the history of cross-stage training, negotiations concerning clause 32.17 of the Agreement, and the implementation of that clause. 37 Further, the witnesses who gave oral evidence and statements in the hearing at first instance are set out in paragraphs 6 and 7 of the Deputy President’s decision. The evidence of Mr Schoer is referred to in [17] of the decision; that of Mr Martin and Mr Eason at [24] and [25]; and evidence of the different ‘pathways’ to cross-training is referred to at[44] of the decision. Given the above, we consider that the Deputy President had regard to the evidence at issue.

[43] We accept the CFMEU’s contention that the Deputy President admitted and considered the evidence of context and of surrounding circumstances to assist him in determining whether an ambiguity existed. 38 We reject grounds of appeal 2 and 3.

[44] In its Outline of Submission, EnergyAustralia put ground 7 in the alternative. That is, in the event that we considered that the Deputy President’s decision involving the interpretation of the Agreement was a discretionary decision to which House v The King applies then error of that kind is established, because the Deputy President acted on wrong principle and did not take into account material considerations in relation to the evidence.

[45] As noted earlier, the task of a Full Bench in reviewing the interpretation of an agreement is to determine whether the interpretation is correct. However, in the course of hearing and determining an application under s.739, a member at first instance might make other decisions, aside from determining the interpretation of the agreement. If such decisions entail discretionary considerations, an appeal against them may enliven the principles in House v The King. The question does not arise in the present case. As we have noted, the Deputy President did admit the evidence in question, and had regard to it.

Alleged refusal to admit evidence of the cross-stage training of Mr Schoer

[46] The fourth ground of appeal also concerns the alleged refusal of the Deputy President to admit evidence, but focuses on evidence about the nature and extent of the cross-stage training engaged in by Mr Schoer prior to 5 December 2013. 39 EnergyAustralia again relies on [53] of the decision in support of this contention. We reject it for the same reason set out at above. The Deputy President did not refuse to admit the evidence in question. Further, the Deputy President had regard to Mr Schoer’s evidence.40

[47] The fourth ground of appeal is rejected.

Alleged failure to provide procedural fairness

[48] Ground 5 contended that the Deputy President denied EnergyAustralia natural justice by refusing to admit the evidence referred to in paragraphs 3 and 4 of the Notice of Appeal, in circumstances where neither party contended that the evidence was inadmissible, and the Commission did not foreshadow its decision on admissibility to the parties. 41

[49] Given our conclusion that the Deputy President admitted the evidence, this ground of appeal must fail.

Error in construction of clause 32.17 of the Agreement

[50] We now come to ground 6 of the Notice of Appeal, which contended that the Deputy President erred in his construction of clause 32.17 of the Agreement. The error is said to lie in the finding that ‘the structured training course’ in the first sentence of the third paragraph means the 2 week course run as 4 x 9 hour days per week, on day work, referred to in the second sentence of that paragraph. 42

[51] Each party contended that clause 32.17 had a plain meaning that accorded with their respective interpretations. EnergyAustralia relied on evidence which it says goes to context that supports its plain interpretation, or in the alternative, goes to the surrounding circumstances to resolve an ambiguity. 43

[52] The CFMEU submitted that EnergyAustralia was seeking to depart from the case it ran at first instance and advance new arguments regarding the interpretation of the Agreement. It contends that at first instance, EnergyAustralia submitted that the meaning of the dispute clause was clear and that it was unnecessary to go beyond the words of the clause to examine the surrounding circumstances. 44 EnergyAustralia did make this submission at first instance.45 However, it appears to us that EnergyAustralia advanced this position as a primary, rather than an exclusive, submission. Its submissions of 25 January 2017 cover an alternative position, namely ‘if regard were had to the surrounding circumstances, this would confirm that not all of the UCs and AUCs are required to undergo the two-week training course referred to in the third paragraph of clause 32.17’.46

[53] Accordingly, we reject the CFMEU’s submission that EnergyAustralia is seeking to depart from its case at first instance.

[54] We now turn to consider the construction of clause 32.17. It is convenient to set out the clause 32.17 in its entirety:

“32.17 TRANSITIONAL CROSS-STAGE TRAINING ARRANGEMENTS

All personnel currently in the PC1 to PC3 classifications will be provided the opportunity to declare their intent to complete cross-stage training. This will be done as part of the PDP process. Those individuals who choose not to declare a commitment to cross-stage train will be immediately classified into the pay classification commensurate with the skills currently possessed. All others will maintain at their current pay rate and have their cross-stage training commitments recorded in their PDP.

The Company will provide a scheduled training program identifying when the training will be provided.

Individuals moving to an AUC or UC level who have not previously completed the structured training course will be provided a structured training course. The program will be a two week course run as 4 x 9 hour days per week on day work.

On completion of the structured training program all individuals will be required to consolidate the training. Each individual will be rostered for 2 shift rounds on the new stage for this consolidation.

• Those at AUC level will be rostered for an additional 2 rounds in an AUC role by which time they will be expected to be deemed competent and have successfully completed the training, resulting in reclassification.


• Those moving to UC level will be rostered for an additional 3 months in a UC role by which time they will be expected to be deemed competent and have successfully completed the training, resulting in reclassification.

It is expected individuals will utilise opportunities to consolidate their newly acquired skills where appropriate.

Where a person has failed to complete the cross-stage training, in the process described above, they will be reclassified immediately into the pay classification commensurate with the skills possessed and they will be rostered for 3 shift rounds in the alternate stage to retrofit the skills required in their new pay classification after which they will be deemed competent.” [Emphasis added]

[55] As noted earlier, the dispute turned on the proper construction of the third paragraph, and in particular what is meant by ‘the structured training course’. The Agreement does not contain any definition of the words ‘structured training course’.

[56] It was common ground that the reference to ‘a structured training course’ in the middle of the third paragraph is the two week course referred to at the end of the paragraph. 47 That is, where the clause says: ‘… a structured training course. The program will be …’, the word ‘program’ is describing what ‘a structured training course’ will be.

[57] However, EnergyAustralia contends that ‘the structured training course’ means something different from ‘a structured training course’. The CFMEU says they mean the same thing, and both refer to the two week course.

[58] EnergyAustralia submitted that the words that begin paragraph 3 give the expression ‘the structured training course’ a temporal setting. It contemplates that there are employees moving from one level to another who ‘have not previously [before the Agreement commenced] completed the structured training course…’ Such employees will be provided ‘a [different] structured training course’. On EnergyAustralia’s argument, when the Agreement commenced operation, it already looked into the past to employees who had not ‘previously completed’ the structured training course. Such a meaning is said to be consistent with the context of the clause, which introduces new classification arrangements and speaks of ‘transitional cross-stage training arrangements’ (see the heading to clause 32.17). According to EnergyAustralia, ‘the structured training course’ must mean whatever it meant before the Agreement was made, when such training was conducted. 48 This contention has some attraction; however the reference to ‘employees who have not previously completed the structured training course’ could also refer to new employees employed after the Agreement was made.

[59] EnergyAustralia further submitted that, based on the evidence before the Commission at first instance, the meaning that ‘the structured training course’ had, before the Agreement was made, ‘included any and all of the different pathways to cross-stage training’ referred to in [36] above. It submitted that there was no evidence of a 2 week 4 x 9 cross-stage course existing prior to the Agreement commencing operation. 49 It was said that ‘the structured training course’, which had a meaning from the past, could not be read as meaning ‘a structured training course’ of 2 weeks x 4 x 9, which was introduced for the first time by the Agreement.

[60] On EnergyAustralia’s argument, it would be odd for the clause to be read as meaning: ‘Anyone who has not completed the 2 week 4 x 9 training program will receive this training.’ This is because, at the time the Agreement was made, no employees had completed this training.’

[61] EnergyAustralia also points to the bargaining history, and an earlier draft clause, that was ultimately abandoned, under which all relevant employees would have been required to undergo a structured training course, regardless of whether they had completed one in the past. 50

[62] For its part, the CFMEU maintained that the interpretation arrived at by the Deputy President was correct, and that the provision has a clear meaning.

[63] The first challenge confronting the reader of the third paragraph of clause 32.17 is the use of the definite article (‘the’) before the words ‘structured training course’. The definite article conveys to the reader that what follows is familiar or specified. However, the expression the ‘structured training course’ is not defined anywhere in the Agreement. Having found no definition of the term in the Agreement, or any immediately compelling logical inference as to its meaning, the reader concludes that ‘the structured training course’ has a meaning outside the Agreement: that the meaning is familiar to those who understand the industry or work in question.

[64] However, a confounding element in this case is that the first sentence of paragraph 3, having just used the definite article, then uses the indefinite article in conjunction with the same expression: individuals who have not completed the structured training course will be provided a structured training course. The confusion is compounded because the definite article has been used in respect of something that is itself quite particular – not just ‘the course’, or ‘the training course’, but ‘the structured training course’.

[65] The Deputy President reached the conclusion that the references to ‘the structured training course’ and ‘a structured training course’ were references to one and the same structured training course. At [50] of the decision, the Deputy President stated:

“The use of the term ‘the structured training course’ (my emphasis) in the first sentence of the third paragraph is telling. If an individual moving to an AUC or UC level has not previously completed ‘the structured training course’, the first sentence requires they be provided with one. The second sentence defines what ‘the structured training course’ referred to in the first sentence is: a two week course run as 4 x 9 hour days per week on day work. The result is that if Mr Schoer, being an individual moving to an AUC or UC level, has not previously completed ‘the structured training course’ as defined in the second sentence of the third paragraph, he is to be provided it.”

[66] We can appreciate why the Deputy President was attracted to this interpretation. An expression comprising three words has been used twice in the same sentence. Why use the same formulation to refer to two different things? Why would not different expressions be used to refer to different things? On the construction adopted by the Deputy President, the clause states that if employees have not previously completed the structured training course, they will be provided with a structured training course - i.e. another iteration of the same course. The program (for the course) will be a two week course run as 4 x 9 hour days.

[67] However, it is also possible to read the clause in the manner contended for by EnergyAustralia. The two references to ‘structured training course’ could be read as different courses: there are employees who have not completed ‘the structured training course’, which has been provided in the past (albeit in several different guises); such employees will be provided a (different) structured training course, namely the two week 4 x 9 hour day course.

[68] Other questions can be raised about the intended meaning of various terms in clause 32.17 and how they might affect the interpretation of the words ‘the structured training course’ and ‘a structured training course’. Those terms include ‘cross-stage training’, ‘scheduled training program’, ‘structured training program’, ‘program’, and ‘process.’ We need not inquire further into them. They only serve to underscore the lack of clarity which pervades the clause.

[69] We have reached the conclusion that clause 32.17 is ambiguous. It is open to more than one meaning. The Deputy President’s conclusion that the clause had a plain meaning was in our respectful opinion not correct.

[70] In light of this conclusion, it is not necessary for us to consider the eighth ground of appeal, namely that the Deputy President erred in concluding that Mr Schoer had not "completed the structured training course" (within the meaning of the first sentence of the third paragraph of clause 32.17) before the Agreement was made in 2013.

[71] It follows from our conclusion that the appeal must be upheld.

Remittal

[72] There was disagreement between the parties as to the course the Full Bench should adopt in the event that it upheld the appeal.

[73] EnergyAustralia contended that the Full Bench should find that the expression ‘the structured training course’ carries whatever meaning it had at the time the Agreement was made, and that the matter should be remitted to the Deputy President for further hearing on that basis. EnergyAustralia opposed the possibility of further evidence being led upon remittal, on the basis that the evidence is in. The role of the Full Bench, according to EnergyAustralia, is to determine the meaning of the Agreement, rather than simply to find it ambiguous and remit it. 51

[74] The CFMEU submitted that the appropriate course would be to remit the matter to the Deputy President to conduct a rehearing, and that the parties have the opportunity to lead further evidence. 52

[75] Our consideration of these competing contentions is affected by our view of the significance of the decision in Berri, which was handed down after the Deputy President’s decision, but before the hearing of the appeal in this matter.

[76] One important aspect of the decision in Berri is its discussion of the nature of enterprise agreements made under the Act, and the fact that, unlike the position that obtained under earlier legislation, there are no ‘parties’ to enterprise agreements. An enterprise agreement is made not between an employer and a union or other bargaining representative, but by an employer and its employees. 53 Accordingly, principles of interpretation that pertain to intention, objectives, and purpose must take into account the position of employees and their understanding of the proposed agreement leading up to, and in particular immediately prior to, the vote to approve the agreement. Evidence of communications between the employer and employees either during negotiations, or as part of the employer explanation required by s.180(5), may be of more interpretative assistance than evidence of negotiations between employers and bargaining representatives.54

[77] In light of the decision in Berri, and the ambiguity we have found to exist, it may be necessary upon remittal for the parties to consider what further evidence might need to be led as to the surrounding circumstances, and in particular the knowledge and understanding of the employees who voted on the Agreement in relation to the issue in dispute. The parties should be afforded the opportunity to consider their evidentiary case accordingly.

Conclusion

[78] We have decided to grant permission to appeal, uphold the appeal and quash the decision. We remit the CFMEU’s s.739 application to Deputy President Clancy for rehearing and determination.

[79] Finally, we note that EnergyAustralia and the CFMEU are currently negotiating a new enterprise agreement. We encourage them to endeavour to resolve the matter that is raised in the s739 application as a part of those negotiations. The Commission is available to the assist in this process.

Order

[80] We order as follows:

(a) Permission to appeal is granted;
(b) The appeal is upheld;
(c) The decision in [2017] FWC 2298 is quashed; and
(d) The application by the CFMEU under s.739 of the Act is remitted to Deputy President Clancy for rehearing and determination.

DEPUTY PRESIDENT

Appearances:

B. Avallone of counsel for EnergyAustralia.

Y. Bakri of counsel for the CFMEU.

Hearing details:

2017.
Melbourne.
15 June.

 1   Construction, Forestry, Mining and Energy Union v EnergyAustralia Yallourn Pty Ltd [2017] FWC 2298, 27 April 2017.

 2   EnergyAustralia’s Closing Submissions, 2 March 2017, paragraph 3.1.

 3   See paragraph 54 of the decision.

 4   Ibid.

 5   Ibid at [55].

 6   [2017] FWCFB 3005.

 7   AMIEU v Golden Cockerel Pty Ltd (Golden Cockerel).

 8   Section 604(1) Fair Work Act 2009 (Cth).

 9   GlaxoSmithKline Australia Pty Ltd v Making [2010] FWAFB 5343 at [26]-[27]; Lawrence v Coal & Allied Mining Services Pty Ltd t/as Mt Thorley Operations/Warkworth [2010] FWAFB 10089 at [28], affirmed on judicial review; Coal & Allied Mining Services Pty Ltd v Lawler [2011] FCAFC 54; Ferrymen Pty Ltd v Maritime Union of Australia [2013] FWCFB 8025; and NSW Bar Association v Brett McAuliffe; Commonwealth of Australia represented by the Australian Taxation Office [2014] FWCFB 1663.

 10   Also see CFMEU v AIRC (1998) 89 FCR 200; and Wan v AIRC (2001) 116 FCR 481. Also see the Explanatory Memorandum to what is now s.604, at paragraph 2328.

 11   Appellant’s Outline of Submissions, dated 2 June 2017 at [7.1].

 12   EnergyAustralia Yallourn Enterprise Agreement 2013 at 28.3.

 13   Respondent’s Outline of Submissions, dated 13 June 2017 at [29].

 14   Ibid at [31].

 15   See Australian Manufacturing Workers’ Union (AMWU) v Silcar, Shop, Distributive and Allied Employees Association (Queensland Branch) Union of Employees v Woolworths. See also DP World Brisbane Pty Ltd v Maritime Union of Australia.

 16   Respondent’s Outline of Submissions, 13 June 2017, paragraphs 34-39.

 17   Pawel v AIRC [1999] FCA 1660.

 18   House v The King (1936) 55 CLR 499.

 19   Form F7 – Notice of Appeal, dated 10 May 2017 at question 2.1 at 2; see also appellant’s Outline of Submissions, dated 2 June 2017 at [2.13].

 20   Ibid at question 2.1 at 3(a); Ibid at [2.14].

 21   Ibid at question 2.1 at 3(b); Ibid at [2.14].

 22   Ibid at question 2.1 at 7; Ibid at [2.1] – [2.4] and [2.15].

 23   EnergyAustralia’s Outline of Submission, paragraph 2.3. See City of Wanneroo v ASU [2006] 153 IR 426 at 438; Amcor Ltd v CFMEU (2005) 222 CLR 241 at [2].

 24   Transcript at [PN57].

 25   Polan v Goulbourn Valley Health [2016] FCA 440 at [34].

 26   See appellant’s Outline of Submissions at 2.5.

 27   Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd [2017] HCA 12 at [16]-[17].

 28   Ibid at paragraph 16. See paragraph 160 of transcript.

 29   See Berri, points 8 to 12 at paragraph 114, and the authorities considered in Golden Cockerel from paragraph 23 to 41. Note also Mount Bruce Mining Pty Limited v Wright Prospecting Pty Limited and Anoth, [2015] HCA 37 at 110 and 111, concerning the question of ambiguity and the surrounding circumstances raised in the judgment of Mason J in Codelfa Construction Pty Ltd v State Rail Authority (NSW) (1982) 149 CLR 337, leaving open the question of whether it is first necessary to identify an ambiguity in a contract before having regard to such circumstances.

 30   See point 1 in paragraph 114 of Berri; and point 8 of paragraph 41 of Golden Cockerel.

 31   [2015] HCA 37, at paragraph 46.

 32   Appellant’s Outline of Submissions at 2.10 and 2.11.

 33   See paragraph 49 of the decision.

 34   Ibid at 2.12. These had been set out in the appellant’s final submissions dated 2 March 2017 at first instance.

 35   Appellant’s Outline of Submissions at paragraph 2.14.

 36   Ibid at 2.13.

 37   Statement of Dale Hogarth, 25 January 2017.

 38   CFMEU Outline of Submissions, paragraph 45.

 39   Appellant’s Outline of Submission’s paragraphs 4.1-4.3.

 40   see [17].

 41   Ibid at [5.1] – [5.2].

 42   Ibid at [3.1] – [3.8].

 43   EnergyAustralia’s Outline of Submissions, paragraphs 2.14, 3.7.

 44   Ibid at [48] – [50].

 45   EnergyAustralia’s Closing Submissions, 2 March 2017, at 8.9.

 46  , Energy Australia’s Outline of Submissions at paragraph 6.9.

 47   Transcript at [PN35].

 48   Appellant’s Outline of Submissions, paragraph 3.4.

 49   at 1.8.

 50   EnergyAustralia’s Outline of Submission, 25 January 2017, paragraph 6.10.

 51   Transcript at [PN378].

 52   Transcript at [PN347, 348].

 53   Principle 5, paragraph 114.

 54   Principle 13, paragraph 114.

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