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Note: Decision is under Appeal (Matter T13202 of 2008)
TASMANIAN INDUSTRIAL COMMISSION
Industrial Relations Act 1984
The Community and Public Sector Union (State Public Services Federation Tasmania) Inc. (T13150 of 2008)
and
The Minister administering the State Service Act 2000
Industrial dispute – travelling allowance - Bass Strait Islands – order issued
REASONS FOR DECISION
[1] On 13 May 2008, the Community and Public Sector Union (State Public Services Federation Tasmania) Inc. (the Union), applied to the President, pursuant to s.29(1) of the Industrial Relations Act 1984 (the Act) for a hearing before a Commissioner in respect of an industrial dispute with the Minister administering the State Service Act 2000 (the employer) arising out of the alleged breach of the General Conditions of Employment Award (GCOE) with respect to Mrs L Wilson.
[2] A hearing commenced at the Edward Braddon Commonwealth Law Courts Building, 39-41 Davey Street, Hobart on 3 June and continued on 12 June and 8 July 2008. On these dates Ms K Tyson and Mr M Di Pretoro appeared for the union, with Mrs Wilson on phone link-up. Ms K Steenhuis appeared for the Department of Primary Industries and Water with Mr D Gillie. On 8 July 2008 Mr P Baker appeared for the Minister administering the State Service Act 2000.
[3] This matter concerns the application of clause 13[c][ix], Part IV of the General Conditions of Employment Award [travelling allowance], which reads:
“(ix) Where an employee is stationed on the Bass Strait Islands and enters upon leave of absence the employee shall, three times in every year, be paid the return fare reasonably incurred by the employee for themselves or for any dependent member of their family resident on the Bass Strait Islands, travelling from their station to the nearest seaport or airport on the mainland of this State. Such travel shall include travel via Melbourne when such indirect travel is the most expedient means of travelling to or returning from the nearest seaport or airport on the mainland of this State.
PROVIDED that:
(1) an employee may in substitution for travel to the nearest seaport or airport in this State, travel to any other seaport or airport in this State or to Melbourne;
(2) for the purpose of obtaining emergency medical or dental treatment for an employee or dependent member of their family resident on the Bass Strait Islands an employee shall by way of reimbursement be paid the return fare reasonably incurred for travel from the employee's station to the nearest centre in this State, or to Melbourne, whereat such treatment can be obtained. Such reimbursement shall be in substitution for one or both of the return fares for the person concerned, more particularly set forth in this paragraph;
(3) the above entitlement is not cumulative, each year standing alone;
(4) no employee shall be eligible to receive payment for the return fares as set forth above unless such employee has first completed three months continuous service on one or other of the Bass Strait Islands.”
[4] The uncontested facts are contained in Mrs Wilson’s statement, which reads:[1]
“2. I began permanent employment as a Client Services Officer with the Department of Primary Industries and Water (DPIW) on the 1/09/03 located at Service Tasmania on Flinders Island.
3. As part of my employment conditions under the General Conditions of Employment Award., DPIW have paid 3 return airfares for my husband and I (ie total of 6 airfares) from Flinders Island to the mainland of Tasmania in each year starting from 2004-2007.
4. On the 16/4/2008 I was advised by my manager Sue Bau-Clark that I would no longer receive the award entitlement of 3 airfares for myself and my dependents (being my husband) per year (ie 6 airfares per year). I would only receive 3 airfares per year to be used between my husband and myself.
5. In 2003 DPIW excluded me from the award entitlement of 3 airfares per year. A claim was made through the Tasmanian Industrial Commission T11489, and the order was made by Deputy President P C Shelley that Bass Strait island employees are entitled to the airfares/award entitlement and are to be reimbursed retrospectively.
6. I am now somewhat disillusioned and feel completely devalued as an employee that my employer again is declining to pay my award entitlement of 3 airfares per year for myself and dependant. This impacts on me as an employee living in a remote and isolated community where the cost of living is considerably high and the only practical mode of transport to Tasmania and the mainland of Australia is via air.”
[5] The matter in dispute is whether the reference “three times in any year” refers to each of the staff member and dependent family members, or whether it imposes a cap of three return fares per year, irrespective of who they apply to.
[6] The former construction is that which has been applied to Mrs Wilson since 2004. The latter is the construction the employer intends to apply in the future.
[7] The application of the travelling allowance and related Bass Strait Islands Allowance have been the subject of earlier proceedings before the Commission. I refer in particular to T3218 of 1991[2], T11180 of 2003[3] and T11489 of 2004.[4] Mrs Wilson was an applicant in each of the 2004 cases.
[8] In each of the above cases the issue in dispute was whether the allowances were payable to employees who were resident on the island at the time of appointment to the State Service. In each it was found that the allowance was payable, irrespective of residency status at the time of appointment.
[9] In a decision handed down on 17 September 2004[5] Shelley DP determined competing applications from the CPSU and MASSA in relation to both allowances. The order issued reflects the award prescription currently applicable. The Deputy President, however, was not asked to determine the question currently before the Commission. One can only assume that it was not a matter in dispute at the time.
[10] In relation to travelling allowance the Deputy President observed:[6]
“The fares are payable to employees for themselves and their dependent family members when travelling off the islands for leave or, by substitution, for emergency medical or dental treatment. Three such claims can be made in every year. I think it probable that the reason that three claims can be made is to accommodate teachers whose leave periods are determined by the school terms.”
History of the Allowance
[11] The allowance, in various formats, has been a feature of State Service industrial regulation for as long as records are available.
[12] In 1963 the Public Service [Conditions of Service] Principal Award contained the following prescription.[7]
“(10) Where an officer is permanently stationed on the Bass Strait Islands and enters upon leave of absence, he may, on the determination of the controlling authority, be paid a sum not exceeding on-half of the return fare of such officer and any member of his family travelling with him from his station to the nearest seaport or airport on the mainland of this State, or such other seaport or airport as the controlling authority may approve.”
[13] On 1 December 1966 the provision was changed to read as follows:[8]
“10. Where an officer is permanently stationed on the Bass Strait Islands and enters upon leave of absence he may, once in every year, on the determination of the controlling authority, be paid the return fare reasonably incurred by him for himself or for any dependent member of his family travelling from his station to the nearest seaport or airport on the mainland of this State, or, with the approval of the controlling authority, any other seaport or airport.”
[14] From 18 April 1974 the number of fares was increased from “one” to “two”. In addition, the proviso concerning emergency medical or dental treatment was included. Save for the earlier reference to the “determination of the controlling authority”, the proviso retains essentially the same terminology today.
[15] From 1 January 1975 the number of return fares was increased from “two” to “three” along with the introduction of the proviso requiring three months service before becoming eligible for the allowance. The award variation[9] records that the variation was by agreement between the Public Service Board and the Tasmanian Public Service Association.
[16] Unfortunately there are no reasons for decision available for these early Public Service Board decisions.
[17] The prescription remained essentially unchanged until Shelley DP determined the current terminology.[10]
Other State Sector Awards
[18] A number of other Public Sector awards contain a provision in either identical or substantially similar terms to that of the GCOE Award.
[19] The Community and Health Services Award is, in all material respects, identical.
[20] The same can be said of the Teaching Service [Tasmanian Public Sector] Award save that there is neither “or” nor “and” between “himself/herself” and “for any dependent member of his/her family…”.I suspect this is a typographical error which has been perpetuated in successive awards.
[21] The Police Award contains substantially similar terms except that “and” rather than “or” is used between “member” and “for any of that member’s dependent relatives…”.
[22] An internal DHHS memorandum dated 1 May 2008 and titled Administration of Bass Strait Leave Expenses Policy relevantly reads as follows:[11]
“Under the Community and Health Services (Public Sector) Award and the Nurses (Tasmanian Public Sector) Award, employees stationed on the Bass Strait Islands who have completed at least 3 months continuous service are entitled to Leave Expenses as outlined in the respective Awards.
In general terms, each employee is entitled to claim 3 return fares each year for themselves and their dependents for travel from their station to mainland Tasmania or Melbourne. The entitlement to 3 return fares is not cumulative, each year stands alone.
This policy has been developed to ensure King Island and Flinders Island have consistent systems in place for administering the Bass Strait Islands Leave Expenses.”
[23] I note that the CAHS Award uses the conjunctive “or” [as does the GCOE Award], whereas the Nurses Award uses the conjunctive “and”. Notwithstanding the Agency applies both awards in an identical manner.
[24] A number of e-mails from State Service employees who had previously worked on Flinders Island supported the contention that the practice has been to pay up to three fares per year for both the staff member and his/her dependant family.[12] These employees had been employed by DPIW and the Parks and Wildlife Service. This evidence was not contested by the respondent.
[25] Mr Baker submitted that other awards, and the manner in which they are applied, is irrelevant to the application before the Commission. The only consideration is the words contained in the GCOE Award.
[26] Whilst I understand this submission, it does seem at odds with the position adopted by the Minister in the 2004 proceedings before Shelley DP. In that matter Mr Pearce, for the Minister, said:[13]
“MR PEARCE: There are, as I understand it and I stand to be corrected, the agencies that do have people located in remote areas such as the west coast, such as the islands, would be education, health, DPIWE - sorry, Department of Primary Industries, Water and Energy - or the Environment, sorry - the Department of Tourism, Parks, Heritage and the Arts and police. They are all bound by various awards which have the same prescription as the general conditions of employment award. We have not at this juncture sought to amend those awards such as the Community and Health Services Award which has similar provisions for district allowance and air travel.
Education and teaching awards I understand will be in the same vein, the same as the nurses' awards. We haven't done any proactive applications in that area using this as a vehicle to endeavour to persuade the Commission that the view we have is the correct view. If the Commission is minded to accept what it is that we put and favour our application then it would follow that we would severally seek to at a later stage and in the not-too-distant future make application to vary those other awards in the same manner.”
[27] It would seem that the Minister’s position in 2004 was that firstly, the relevant clauses in the various awards were the same, and secondly, if the employer was successful in its application, it would seek to vary the other awards in the same vein.
Other Submissions
Ms Tyson, for the applicant:
[28] This matter is not being pursued as an alleged award breach, but rather as an industrial dispute pursuant to s.29[1] of the Act.
[29] DPIW and other Government Agencies have, hitherto, consistently applied the provision in a manner whereby the three fares were paid for both the employee and dependant family members.
[30] The provision, when read as a whole, leads to a conclusion that this is the correct application. For example, when the prescription changed from one fare to two, the proviso relating to medical emergencies states:
“Such reimbursement shall be in substitution for one or both of the return fares for the person concerned...”
[31] If the cap was intended to apply in a cumulative rather than individual sense, then reference to “the person concerned” would be superfluous. The fact that this was not changed to read “for one or all of the fares” when the cap changed to three, was a drafting oversight.
[32] For DPIW to change a long standing custom and practice, which was consistent with the wider public sector, is inequitable.
[33] The additional financial costs imposed by the change in policy will inhibit the ability of employees and their families to absent themselves from the islands during a period of leave. This will impact negatively, not just on existing employees, but also on the ability of the agency to attract and retain quality staff in remote locations.
Mr Baker, for the Minister:
[34] Whilst the Commission has jurisdiction to hear the matter, it does not have jurisdiction to make an order as sought by the applicant. Specifically, s31[4] states:
“(4) An order under this section does not have effect so as to require any person to contravene, or fail to comply with, an award or to commit an offence, or to do an act which, if the order had not been made, would render that person liable to any legal proceedings.”
[35] The order sought is in fact a contravention of the Award as it is currently constructed.
[36] Section 31 is to be read in conjunction with s.38[1] of the State Service Act 2000, which reads:
“(1) The terms and conditions of employment of employees are to be those specified in an award relating to persons engaged in the work for which they are employed or, if no such award is in force, are to be determined by the Minister.”
[37] On any reading, the employer is not in breach of the award.
[38] If there is to be an interpretation of the provision, the applicant should file an application pursuant to s.43 of the Act.
[39] In the alternative, the principles of interpretation as determined by Keorbin P[14] should be applied.
[40] Applying the principles of interpretation, the Macquarie Dictionary defines ‘and’ as:
“Word used to connect words; phrases or clauses that have the same grammatical function in, or in their construction…”
[41] Whereas “or” again is used to connect words as a conjunction, but it’s to connect alternative terms; used to indicate an alternative. Eg hot or cold.
[42] What has been applied in the past is in the nature of an over award payment and there is no basis for the continuation of an over award payment. Further the Commission has no jurisdiction to deal with over award payments. See ALHMWU v Rams Management Group.[15]
[43] Further, for an Agency to pay over-award payments is in breach of the Financial Management and Audit Act 1990 and clause 6 of Treasury Instruction 701, unless there exists some specific lawful authority to make such over award payments.
[44] Questions of merit and equity are not relevant to this application. The matter should only be determined on the interpretation of the award as it currently stands.
Findings
[45] This application was lodged pursuant to s.29[1] of the Act, which relates to existence of an industrial dispute. The statement in support of the application does however allege a breach of clause 32[sic] of the GCOE Award. Notwithstanding, Ms Tyson made it clear during proceedings that the union was not pursuing the matter as an award breach, but rather as an industrial dispute, for which an order pursuant to s.31 of the Act was sought.
[46] Mr Baker submits that whilst the Commission has jurisdiction to hear the dispute, it does not have jurisdiction to make an order in the manner sought by the applicant. Specifically, Mr Baker contended that such an order would be contrary to s.31[4].
[47] The extent of jurisdiction available under s.31 was considered by Blow J in Blue Ribbon Products Pty Ltd v TIC in which he said:[16]
“The language of the relevant provisions of the Act could hardly be wider. I refer in particular to s31(1) which requires the Commissioner presiding at a hearing under s29, if he or she is of the opinion “that anything should be required to be done, or that any action should be required to be taken, for the purpose of…settling the industrial dispute in respect of which the hearing was convened”, to “direct that that thing is to be done or that action is to be taken.” I also refer particularly to the requirement of s20(10)(a) that the Commission “act according to equity, good conscience and the merits of the case without regard to technicalities or legal forms”; to the requirement of s20(1)(b) that the Commission “do such things as appear to it to be right and proper…for preventing and settling industrial disputes”; and to the flexible procedural provisions to be found in ss21(1),(2) and 20(3), to which I will refer again later.
Counsel for the applicants suggested that a power to make orders binding upon entities other than employers could have alarming and inappropriate consequences. Mr O’Farrell suggested that if the Commission had powers to bind non-employers in disputes relating to the termination or proposed termination of employment, it could make an order requiring a bank to reverse a decision to cancel an employer’s overdraft, or make an order restraining a human resources consultant form recommending changes that might produce efficiencies by requiring less labour, or make an order requiring a profitable subsidiary company to provide financial support to an unprofitable holding company wishing to reduce its workforce. Counsel for Newemploy, Mr McDermott, suggested that such an interpretation could result in the Commission ordering a customer of an employer not to withdraw an order whose withdrawal might result in the reduction of the employer’s workforce, or to making an order compelling a supplier to continue providing supplies to an employer against its will. There are a number of answers to these suggestions. If the power to make orders in such situations existed, it is hardly likely that the Commission would make orders that were unfair to the sorts of entities referred to by counsel, given the requirement of s20(1)(a) to “act according to equity, good conscience, and the merits of the case”, the requirement of s20(1)(b) to “do such things as appear…to be right and proper”, and the provisions in s30(3)(b) whereby the operational requirements of an employer’s business can result in the termination of an employee’s employment being permissible even when that employee has a reasonable expectation of continuing employment. More fundamentally, it is necessary to draw a distinction between decisions made by employers and others as to industrial relations questions and decisions made by employers and others as to other questions that have industrial relations consequences. The general words of the Act should “be understood in their context as applying only in the area of industrial relations”: Federated Clerks’ Union of Australia v Victorian Employers’ Federation (supra) per Gibbs CJ at 480. A commissioner’s power under s31(1) to order that a “thing is to be done”, or that an “action is to be taken” must be understood as limited to things and action in the area of industrial relations.”
[48] And later:
“Having regard to the purpose of the relevant provisions in the Act, the ordinary meaning of s31(1), the history of the relevant legislative provisions, and the other matters I have referred to, I think that Parliament intended s31(1) to operate very widely in its scope, and to enable orders to be made imposing requirements to take positive action upon such persons or entities as commissioners think appropriate according to the circumstances of particular cases, provided only that there must be some industrial character to any thing required to be done or action required to be taken.”
[49] The capacity to make orders pursuant to s.31 is broad, and for reasons that will become apparent, I am quite satisfied that jurisdiction exists to make an order in settlement of this dispute which does not offend s.31[4], or for that matter, any other statute or relevant industrial principle.
[50] I do not accept Mr Baker’s contention that matters of merit and equity are of no consequence. Indeed s.20 requires the Commission, in exercising its jurisdiction, to act according to equity, good conscience, and the merits of the case without regard to technicalities or legal forms.”
[51] That said, I readily acknowledge that the plain meaning of the words in the relevant clause must be the uppermost consideration. However this does not, in my view, preclude the Commission from looking for what might be the commonsense meaning and intent of the clause, notwithstanding a degree of drafting inelegance, and indeed, oversight.[see last sentence of proviso [2] in clause 13[c][ix]].
[52] It is plain from the uncontested evidence that Agencies in the wider public sector apply the fare cap of three, separately to both the employee and individual family dependents. This construction applies notwithstanding that, of the range in awards in question, some use the conjunction “or” and others use “and”. To complete the picture, the Teaching Service Award omits the conjunction altogether! There was no evidence produced of any Agency employing staff on the islands, applying the cap in a cumulative manner.
[53] Indeed, up until April 2008, DPIW applied the cap separately to each member of the family. No reason was advanced as to why the change was made.
[54] Whilst no reasons for decision are available for the earlier Public Service Board determinations, it is plainly obvious that, at least since 1963, that the allowance was intended to be available to both the employee and dependent family members. The only things of substance that have changed over succeeding years are the number of fares available, the inclusion of certain provisos, and the removal of a discretion previously residing in the Controlling Authority.
[55] In 1966 the cap was increased from half to one fare per annum. If I am to accept the respondent’s position, the following would apply. The employee proceeds on leave. This would provide the trigger for one dependent to be paid a return fare. However if this occurred the employee would be disentitled to the allowance. I have a huge difficulty in accepting that this was the intent of the award makers at the time, or indeed the plain meaning of the words.
[56] In 1974 the cap was increased to two, and the proviso relating to emergency medical treatment included. This proviso uses the expression:
“‘such reimbursement shall be in substitution for one or both of the return fares for the person concerned.”
[57] I readily accept Ms Tyson’s submission that if the cap was to apply in a cumulative sense, the words underlined above are superfluous.
[58] I have no doubt that the purpose of the allowance is to allow families in isolated communities the opportunity to absent the island for purposes of leave or medical emergency. If the cap is to apply in a cumulative sense, it would seriously negate this objective.
[59] The wording of the clause is inelegant, perhaps even clumsy. Nonetheless it is, in my view, capable of sensible construction as evidenced by an apparent universal application across the public sector for nearly fifty years, perhaps longer. In my view the same construction is open, irrespective of whether “and” or “or” is used as the conjunction.
[60] I do not accept that construction that has hitherto applied is in the nature of an over award payment. It is, in my view, no more than the proper and sensible construction of the words used. It is therefore unnecessary to answer Mr Baker’s submission about the Commission’s jurisdiction on such matters other than to refer again to Blow J’s observations in Blue Ribbon.
[61] Of course it would be open for a provision of this nature to apply a cap in a cumulative sense. However if this was to be the case, the proper approach would be to express such an intent in explicit terms.
[62] I intend to issue an order in favour of Mrs Wilson. I did consider issuing a direction pursuant to s31[3] to put the issue beyond doubt, but have concluded that that is a matter for the parties.
Order
Pursuant to section 31 of the Industrial Relations Act 1984 I hereby order that the Minister Administering the State Service Act 2000, upon application, pay to both Lynette Wilson and any dependent member/s of her family, up to three return fares each incurred in each year in accordance with Clause 13, Travel Allowances, Part IV of the General Conditions of Employment Award and existing administrative arrangements applicable in the Department of Primary Industries and Water.
Tim Abey
Appearances:
Date and place of hearing:
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