| [2019] FWC 4122 [Note: An appeal pursuant to s.604 (C2019/4194) was lodged against this decision.] |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.739—Dispute resolution
Robert Battye
v
John Holland Pty Ltd
(C2017/4132)
COMMISSIONER BISSETT |
MELBOURNE, 20 JUNE 2019 |
Alleged dispute about any matters arising under the enterprise agreement and the NES;[s186(6)].
[1] Mr Robert Battye notified the Fair Work Commission (Commission) of an industrial dispute with John Holland Pty Ltd (John Holland) on 27 July 2017. The dispute is said to arise under the Territoria Collective Agreement 2013 1 (2013 Agreement). The Form F10 filed by Mr Battye says that the dispute is in relation to the correct classification of Mr Battye and the payment of particular allowances to Mr Battye.
[2] Mr Battye commenced employment with John Holland on 1 January 2016. His employment ended on 16 October 2017.
[3] The matter was first listed for conference in August 2017 in Darwin. The dispute was not resolved at that conference. Following the conference Mr Battye had no correspondence with the Commission until 20 December 2018 when he requested that his application be re-listed for the purpose of programming in 2019.
[4] The application was listed for conference on 18 February 2019 by telephone. At that conference I requested that the parties have further discussion to determine if the matter could be resolved. John Holland indicated that it had a jurisdictional objection to the dispute proceeding but indicated it was prepared to have further discussions with Mr Battye.
[5] On 27 February 2019 the Commission received advice from Mr Battye that further discussions had been unsuccessful in resolving the dispute and requested that the jurisdictional matter be dealt with.
[6] The parties have consented to the Commission dealing with the jurisdictional objection on the basis of submissions filed in accordance with directions issued by the Commission.
There are three aspects to the dispute notified by Mr Battye. These are:
1. The classification dispute
Mr Battye claims that he should have been classified (and paid) at Level 5 and not Level 4 on and from his commencement date with John Holland (clause 13.3 of the 2013 Agreement).
2. The demotion dispute
Mr Battye claims that he was unilaterally and improperly demoted from Level 5 duties to Level 4 duties on 27 April 2017 by the actions of Mr Aaron Sacagio (Project Manager).
3. The multi-skilled allowance dispute
Mr Battye says he was entitled to receive the multi-skilled allowance from his commencement date with John Holland (clause 19 of the 2013 Agreement).
[7] To the extent necessary I am satisfied that these are matters that arise under the 2013 Agreement.
[8] John Holland submits that as of 16 May 2018 the Commission ceased to have jurisdiction to deal with the dispute subject to the application currently before the Commission because on this date the 2013 Agreement ceased to operate because the Territoria Collective Agreement 2017 2 (2017 Agreement) had commenced to operate.
[9] John Holland submits that the Commission will no longer have jurisdiction to deal with a dispute if the agreement under which the dispute arose ceases to operate while the dispute is on foot unless the successor agreement allows the dispute to continue through a savings provision.
[10] In this case John Holland submits that clause 45 of the 2013 Agreement empowered the Commission to deal with disputes in relation to the 2013 Agreement; the 2013 Agreement ceased to operate on 16 May 2018 when the 2017 Agreement commenced; the 2017 Agreement does not have a savings clause and the dispute notified to the Commission was in relation to matters arising under the 2013 Agreement and not the 2017 Agreement.
[11] Further, John Holland submits that even if the 2017 Agreement was not limited to dealing with disputes arising under that agreement, Mr Battye was not employed at the time the 2017 Agreement commenced to operate, the 2017 Agreement never applied to Mr Battye and he therefore could not raise a dispute pursuant to the 2017 Agreement.
[12] John Holland also submits that even if Mr Battye did have a right to have his dispute dealt with under the 2013 Agreement after his employment ended this right was extinguished when the 2013 Agreement ceased to operate.
[13] John Holland submits that even if the Commission finds that it does have jurisdiction to deal with the dispute it should, as a matter of discretion, decline to do so. It submits that Mr Battye has taken no action to prosecute this application between August 2017 and December 2018 and he should not be permitted to make an application, “warehouse” it and enliven it then at some time of his choosing. It says that the conduct of Mr Battye undermines the purpose and effectiveness of the dispute settlement procedure in the 2013 Agreement.
[14] John Holland submits that s.739(4) of the Fair Work Act 2009 (FW Act) does not confer an unqualified, indefinite jurisdiction on the Commission to arbitrate a but that this dispute arising under an agreement where that agreement has ceased to operate. John Holland says that s.595 of the FW Act is the source of the Commission’s power to arbitrate a dispute but that this is limited by s.739. Section 739(1) of the FW Act states that the section applies if a term referred to in s.738 “requires or allows” the Commission to deal with a dispute. Section 738 of the FW Act refers to terms in an enterprise agreement that provide procedures for dealing with a dispute. From 16 May 2018 the 2013 Agreement ceased to operate (see s.54(2)(b), s.54(3) and s.58(2)(e) of the FW Act) so from that point in time the 2013 Agreement did not require or allow anything. Because the 2013 Agreement has ceased to operate there is, therefore, no operative term of the 2013 Agreement that would allow the Commission to arbitrate the dispute under the 2013 Agreement.
[15] The argument that John Holland gave “advanced consent” to have disputes arbitrated by the dispute settlement procedure of the 2013 Agreement must fail because the dispute settlement procedure of the 2013 Agreement remains subject to the limitations imposed by the FW Act.
[16] Mr Battye says that:
• He made his application to the Commission to deal with a dispute pursuant to the 2013 Agreement before he resigned his employment;
• The Commission has power to deal with the dispute even though his employment has ended;
• His dispute has not been settled by the making of the 2017 Agreement;
• In making the 2013 Agreement John Holland gave advanced consent through clause 45.1.4 of the 2013 Agreement to having a dispute under that 2013 Agreement settled by arbitration;
• The 2017 Agreement never covered his employment and therefore could not have extinguished his rights pursuant to the 2013 Agreement;
• Only s.58(1) and s.58(2)(a) of the FW Act apply in this case and s.58(2)(b), s.58(2)(d) and s.58(e) do not apply.
[17] There are a number of factual matters that are not in dispute between the parties. These are:
1. Mr Battye commenced employment on 1 January 2016;
2. Mr Battye resigned from his employment on 16 October 2017;
3. Mr Batty made his application to the Commission on 27 July 2017, before his employment ended;
4. The 2013 Agreement ceased to operate on 16 May 2018 when the 2017 Agreement commenced operation;
5. Clause 45 of the 2013 Agreement is the dispute settlement procedure. It relevantly states:
45. DISPUTES AND GRIEVANCE PROCEDURE
45.1 If there is a dispute arising from a matter dealt with by this Agreement or the National Employment Standards (except s.65(5) and s.76(4) of the FW Act), it shall be dealt with in the following manner:
45.1.1 as soon as practicable after the dispute or claim has arisen, the Employee concerned shall notify his or her immediate supervisor, affording that supervisor the opportunity to remedy the cause of the dispute or claim;
45.1.2 if no resolution for the Employee's grievance is reached, then the Employee shall seek further discussions and attempt to resolve the grievance with the Project Manager as prescribed by the Company from time to time;
45.1.3 if the matter is still unresolved, the Employee's grievance may be referred to the Company's Human Resources Manager and/or the relevant Business Manager, for resolution;
45.1.4 If the matter is not resolved at this stage, the matter may be referred to Fair Work Commission for conciliation and/or arbitration for resolution. The decision made by Fair Work Commission shall be binding to both the Company and affected Employee(s).
45.1.5 The Company reserves the right to be legally represented for all matters before FWC.
45.2 It is agreed that during the time when the affected Employee(s) and the Company attempt to resolve the matter:
45.2.1 work shall continue as normal in accordance with this Agreement;
45.2.2 no industrial action shall be commenced or taken;
45.2.3 nothing in this Clause shall effect the ability of the Company to terminate an Employee pursuant to the termination Clause(s) in this Agreement.
45.2.4 the affected Employee(s) and the Company must co-operate to ensure that the dispute resolution procedures are carried out as expeditiously as is reasonably possible.
45.3 Safety issues shall be isolated from industrial matters and any issue or dispute relating to safety shall be dealt with in accordance with Company policy, procedure and relevant safety legislation.
45.4 Final settlement of the dispute will not be prejudiced by continuance of work under the dispute and grievance procedure in this Agreement.
45.5 An Employee may choose to be represented at any stage of this procedure or in relation to any matters dealt with under this procedure.
45.6 Any decision or suggested resolution of a grievance under this Clause shall not be inconsistent with the Fair Work (Building Industry) Act 2012 (Cth) or legislative obligations.
6. Mr Battye does not seek to progress his dispute under the 2017 Agreement.
[18] Both parties put substantial authorities before me. The power of the Commission to arbitrate a dispute in the circumstances before me has been widely canvassed by the Commission such that some consideration of the authorities is necessary. I have only considered below those authorities relevant to the matters I need to determine so that I have not considered, for example, authorities in relation to the power to make an application once employment has ended (as Mr Battye made his application before his employment ended).
[19] The authorities in relation to jurisdiction of the Commission in circumstances where an agreement under which a dispute is notified ceases to apply are clear. The Commission does not have jurisdiction to deal with a dispute in circumstances where the agreement to which the dispute relates ceases to operate. Stephenson v Senator the Honourable Eric Abetz (Special Minister of State) 3 (Stephenson) remains Full Bench authority for this proposition. This decision was endorsed and followed by subsequent Full Benches in Pulle v Commonwealth4 (Pulle) and de Jong v Australian Broadcasting Corporation.5 That authority has not been disturbed. In Stephenson the applicant was covered by the 2001 agreement at the time he made his application for the Commission to deal with a dispute. The 2001 agreement was replaced soon after the dispute was notified by the 2003 agreement. It was in these circumstances it was determined that the Commission no longer had jurisdiction to deal with the application.
[20] In The Association of Professional Engineers, Scientists and Managers, Australia v Jemena Asset Management Pty Ltd 6 (Jemena) I considered the application of the principles in Stephenson in circumstances where a dispute had been notified under an agreement which applied to the employee concerned at the time it was notified but no longer applied at the time the dispute went to hearing. The issue to be determined was if the Commission had jurisdiction to deal with the dispute under an agreement which no longer applied.
[21] In Jemena I set out the relevant considerations as follows:
[29] In Stephenson the Full Bench determined that it was not possible to arbitrate under the dispute settling provisions of an enterprise agreement unless that agreement existed. In that case the enterprise agreement under which the dispute had been notified had been replaced by a new agreement and the later agreement made it explicit that the previous agreement was excluded from operation.
[30] The Full Bench in Stephenson concluded that:
...if a certified agreement empowering the Commission to settle disputes over the application of the agreement ceases to operate because of the provision of s.170LX of the Act, then the Commission no longer has jurisdiction to exercise that private arbitration power in the agreement.
[31] The relevant principle to be drawn from Stephenson is that the Commissions jurisdiction to deal with a dispute over the application of an agreement is a jurisdiction that must be conferred by the agreement itself and any limits imposed by the Act.
[32] Section 170LX in the Workplace Relations Act 1996, as applied at the time of the decision in Stephenson, states:
170LX When a certified agreement is in operation
(1) A certified agreement comes into operation when it is certified and, subject to this section, remains in operation at all times afterwards.
(2) The agreement ceases to be in operation if:
(a) its nominal expiry date has passed; and
(b) it is replaced by another certified agreement.
[33] Section 58 of the FW Act states:
58 Only one enterprise agreement can apply to an employee
Only one enterprise agreement can apply to an employee
(1) Only one enterprise agreement can apply to an employee at a particular time.
General rule—later agreement does not apply until earlier agreement passes its nominal expiry date
(2) If:
(a) an enterprise agreement (the earlier agreement) applies to an employee in relation to particular employment; and
(b) another enterprise agreement (the later agreement) that covers the employee in relation to the same employment comes into operation; and
(c) subsection (3) (which deals with a single-enterprise agreement replacing a multi-enterprise agreement) does not apply;
then:
(d) if the earlier agreement has not passed its nominal expiry date:
(i) the later agreement cannot apply to the employee in relation to that employment until the earlier agreement passes its nominal expiry date; and
(ii) the earlier agreement ceases to apply to the employee in relation to that employment when the earlier agreement passes its nominal expiry date, and can never so apply again; or
(e) if the earlier agreement has passed its nominal expiry date—the earlier agreement ceases to apply to the employee when the later agreement comes into operation, and can never so apply again.
[34] Section 58(2)(e) of the FW Act has the same effect as 170LX(2)(b). That is, once an agreement which has passed its nominal expiry date is replaced, the old agreement ceases to operate (or, in the new parlance, the old agreement ceases to apply and can never apply again).
[35] In this case the earlier agreement (the JAM Agreement) had passed its nominal expiry date at the time the later agreement (the Zinfra Agreement) came into operation. By virtue of s.58(2)(e) the JAM Agreement ceased to apply to Mr Hardy at the time the Zinfra Agreement came into operation and can never apply again.
[36] Section 51 of the FW Act states:
51 The significance of an enterprise agreement applying to a person
(1) An enterprise agreement does not impose obligations on a person, and a person does not contravene a term of an enterprise agreement, unless the agreement applies to the person.
(2) An enterprise agreement does not give a person an entitlement unless the agreement applies to the person.
[37] Once the JAM Agreement ceased to apply to Mr Hardy any entitlements available to Mr Hardy pursuant to that agreement ceased to exist.
[38] There is nothing discernible in the FW Act that suggests any general savings provision with respect to an application made pursuant to a dispute settling procedure once the agreement that contains that procedure ceases to apply. In this respect the general limits in the FW Act have not changed from those in existence in the Workplace Relations Act 1996. As such, the principles in Stephenson remain apposite.
[39] There is no savings provision in the Zinfra Agreement such that a dispute raised under the JAM Agreement can continue to be prosecuted once the JAM Agreement ceased to apply. [Footnotes omitted]
[22] I adopt the reasoning in Jemena in this matter.
[23] In Queensland Services, Industrial Union of Employees v Ergon Energy Corporation Ltd 7 (Ergon Energy) Deputy President Asbury considered an application to deal with a dispute in relation to the operation of an agreement which had, at the time the dispute was notified, been replaced and was no longer in operation pursuant to the provisions of the FW Act. The Deputy President considered a number of decisions including Stephenson and Pulle and concluded that a number of principles could be drawn from these cases:
[53] The principles set down in the cases are that:
• Absent a savings provision in either the legislation dealing with an agreement ceasing to operate or in the successor agreement, or a provision in relation to the same matter in a successor agreement, a right does not survive the cessation of an agreement.
• Where a dispute clause in an agreement empowers the Commission to settle a dispute in relation to that agreement, and a dispute is commenced, the Commission will no longer have jurisdiction to deal with the dispute if the agreement ceases to operate while the dispute is on foot, unless the successor agreement has a savings clause, or the legislation preserves rights in this respect.
• Where a series of agreements contains the same provision, the Commission may have jurisdiction to deal with a dispute about that provision in accordance with a dispute procedure in a current agreement, notwithstanding that the dispute also relates to a period of time where predecessor agreements containing the same or a similar provision, operated.
• The terms of a dispute procedure, including whether it is expressed to apply to all disputes or those arising under the current agreement, are critical, and may limit the jurisdiction of the Commission to deal with a dispute that relates to a provision that has been included in both the current and predecessor agreements.
[24] I respectfully agree with the principles as outlined by the Deputy President.
[25] Mr Battye relies on the decision of Commissioner Lee in Michael Stevens v Australian Federal Police 8 (Stevens). I consider that decision distinguishable from the case before me on the facts. In Stevens the Commissioner found that he had jurisdiction to deal with the matter even though the old agreement no longer had effect. He, importantly, found that he did not have power to arbitrate the matter under the dispute settlement procedure of the old agreement as it no longer had legal effect.9 Rather, the Commissioner found that the new agreement incorporated the relevant provisions of the old agreement and he found that he therefore had jurisdiction under the new agreement to arbitrate the dispute.10
[26] It was precisely because of the incorporation of provisions of the old agreement into the new agreement that the Commissioner found he could arbitrate the matter in dispute. It would be erroneous to see this decision as providing authority for the proposition that the Commission generally retains the power to arbitrate under an agreement which has ceased to apply.
[27] Mr Battye also relies on the Full Bench majority decision in BlueScope Steel (AIS) Port Kembla v The Australian Workers’ Union & the Australian Manufacturing Workers’ Union & the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia 11 (BlueScope) in which he suggests the majority decision supports the proposition that a dispute notified under an earlier agreement could continue to be dealt with subsequent to the making of a later agreement.
[28] I consider the decision in Bluescope distinguishable on the facts to the matter before me. In Bluescope the Commissioner at first instance had dealt with a dispute under the 2012 Agreement and issued a decision in relation to that dispute. Subsequent to the Commissioner’s decision the 2015 Agreement commenced operation and the 2012 Agreement ceased to operate by virtue of s.58 of the FW Act. A review contemplated in the decision of the Commission had not been undertaken prior to the 2015 Agreement commencing to operate. The unions sought to have the review occur and the employer objected on jurisdictional grounds. The Commissioner subsequently found he could conduct the review and the employer appealed that decision. In refusing permission to appeal the Full Bench majority said that:
• It would be premature to grant permission given that all that flowed from the later decision of the Commission was the conduct of a review;
• It was not considered the appeal had practical utility;
• The contemplated review was a part of the outcome of the first decision and the decision was conditional on the review;
• The critical question was complex and the majority had not been provided with the degree of assistance necessary to correctly resolve that question. 12
[29] The majority in BlueScope did not ultimately address the question before me. To the extent that Deputy President Colman found, in the minority, that there was no jurisdiction for the Commission to continue to deal with the dispute, this is of no benefit to Mr Battye and supports the submissions of John Holland.
[30] Mr Battye also seeks to rely on the decision of the High Court in Westralian Farmers Limited v Commonwealth Agriculture Service Engineers Limited 13 in support of his proposition that John Holland had given “advanced consent” to the arbitration under the 2013 Agreement but has not taken me to the reasoning of that decision or its application in circumstances where the power to arbitrate is conditioned by the terms of an agreement and legislative limitations as outlined in Jemena.
[31] On the basis of the authorities outlined above it is readily apparent that, on its face, the Commission lacks jurisdiction to deal with Mr Battye’s application because the 2013 Agreement, from which the Commission draws the power to deal with the dispute, has ceased to operate.
[32] In a novel argument Mr Battye contends that, because he ceased employment prior to the commencement of the 2017 Agreement, s.58(2)(b), s.58(2)(d) and s.58(2)(e) of the FW Act do not apply in his case and, for this reason, he still has a valid application before the Commission. Mr Battye also suggests that his case can be distinguished from the authorities set out above as those cases are all based on a factual matrix that includes the employee still being employed by the same employer at the time they sought to have their dispute arbitrated. He was not so employed.
[33] Section 58 of the FW Act states as follows:
58 Only one enterprise agreement can apply to an employee
Only one enterprise agreement can apply to an employee
(1) Only one enterprise agreement can apply to an employee at a particular time.
General rule—later agreement does not apply until earlier agreement passes its nominal expiry date
(2) If:
(a) an enterprise agreement (the earlier agreement) applies to an employee in relation to particular employment; and
(b) another enterprise agreement (the later agreement) that covers the employee in relation to the same employment comes into operation; and
(c) subsection (3) (which deals with a single-enterprise agreement replacing a multi-enterprise agreement) does not apply;
then:
(d) if the earlier agreement has not passed its nominal expiry date:
(i) the later agreement cannot apply to the employee in relation to that employment until the earlier agreement passes its nominal expiry date; and
(ii) the earlier agreement ceases to apply to the employee in relation to that employment when the earlier agreement passes its nominal expiry date, and can never so apply again; or
(e) if the earlier agreement has passed its nominal expiry date—the earlier agreement ceases to apply to the employee when the later agreement comes into operation, and can never so apply again.
Special rule—single-enterprise agreement replaces multi-enterprise agreement
(3) Despite subsection (2), if:
(a) a multi-enterprise agreement applies to an employee in relation to particular employment; and
(b) a single-enterprise agreement that covers the employee in relation to the same employment comes into operation;
the multi-enterprise agreement ceases to apply to the employee in relation to that employment when the single-enterprise agreement comes into operation, and can never so apply again.
[34] Mr Battye says that the 2013 Agreement (the earlier agreement) applied in relation to his employment with John Holland but, because he left his employment before the 2017 Agreement (the later agreement) commenced operation, the 2017 Agreement never applied to him such that there is no “later agreement” that displaces the 2013 Agreement in his case. Mr Battye suggests therefore that the 2013 Agreement continues to apply to him.
[35] Mr Battye can only gain comfort from this line of reasoning if he is still an employee of John Holland. This is because an agreement covers an employee (or employer) only if it is expressed to cover the employee or employer (s.53(1) of the FW Act). An agreement cannot therefore cover a person who is not an employee even if that person was previously an employee.
[36] The scope and application clause of the 2013 Agreement states that it is binding on John Holland and employees employed by John Holland carrying out specified works and in the classifications listed.
[37] By virtue of s.52(1) of the FW Act an agreement applies to an employee only if the agreement is in operation, and it covers the employee and it is not otherwise excluded from applying. Mr Battye is not an employee of John Holland such that any agreement of John Holland cannot apply to him. Lest there be any confusion the FW Act is clear at s.52(2) that a reference to an agreement applying to an employee “is a reference to the agreement applying to the employee in relation to particular employment.” Mr Battye was no longer in the “particular employment” to which the 2013 Agreement applied (even if it had continued to operate).
[38] Mr Battye’s submissions with respect to s.58 of the FW Act must therefore fail.
[39] Once Mr Battye ceased employment with John Holland the 2013 Agreement ceased to apply to him when he resigned his employment on 16 October 2017. By virtue of s.58 of the FW Act the 2013 Agreement ceased operating on 16 May 2018.
[40] The Disputes and Grievance Procedure clause of the 2017 Agreement states that it applies to “a dispute arising from a matter dealt with by this Agreement…”. Neither the procedure or any other provision of the 2017 Agreement contain any savings provision that suggest Mr Battye can continue to prosecute his dispute under the 2017 Agreement.
[41] On the basis of the authorities considered and the factual circumstances of this case I am satisfied that the Commission does not have jurisdiction to deal with Mr Battye’s application.
[42] The 2013 Agreement covered Mr Battye’s employment for the period he was an employee of John Holland. It applied at the time Mr Battye made his application for the Commission to deal with his dispute. It ceased to apply to him when he resigned his employment.
[43] These circumstances alone would not have been fatal to Mr Battye’s application had he pursued it at the time he first made his application to the Commission in 2017. On 16 May 2018 the 2017 Agreement commenced operation and by virtue of the FW Act the 2013 Agreement ceased operation at that time. Having ceased operation the 2013 Agreement ceased to apply (if Mr Battye was an employee at that time).
[44] Mr Battye finds himself in these circumstances purely of his own making. He made his application in July 2017. It was first dealt with by the Commission in August 2017. He then chose to take no action in relation to the matter until December 2018, and then only because of a follow up note from my chambers. His dispute clearly was not of such a pressing nature that he gave it anything but scant attention.
[45] For these reasons the application of Mr Battye is dismissed for want of jurisdiction.
COMMISSIONER
Printed by authority of the Commonwealth Government Printer
<PR709341>
1 AE404581.
2 AE428192.
3 PR952743 (20 October 2004).
4 (2009) 190 IR 365.
5 (2010) 196 IR 145.
7 [2013] FWC 7025 cited in Freeman v State of Victoria [2018] FWC 212 at [27].
9 Ibid at [33].
10 Ibid at [46].
12 Ibid at [59].
13 (1936) 54 CLR 361.