T8060
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TASMANIAN INDUSTRIAL COMMISSION Industrial Relations Act 1984 Ronald Matthews and Racing Tasmania
Termination of employment - delegation of Ministerial powers to employ and to terminate employment - respondent did not have power to terminate employment - Minister's delegate ordered to comply with terms of contract of employment except for that part beyond power REASONS FOR DECISION Circumstances of the Dispute according to the Applicant Mr Ronald Matthews is the applicant in these proceedings. The respondent former employer is Mr David Hamilton Peters, the Director of Racing, acting as the delegate of the Minister Administering the Tasmanian State Service Act 1984. Racing Tasmania is a statutory authority created under the Racing Act 1983. The authority comprises three specialist councils that cover, respectively, thoroughbred racing, harness racing and greyhound racing. The Director of Racing, at the direction of Racing Tasmania, employed Mr Matthews as a stipendiary steward (Chairman of Stewards - Greyhound Racing) for the Tasmanian Greyhound Racing Council. For that purpose the Director initially engaged him on a three-year contract pursuant to section 38(1)(a) of the Tasmanian State Service Act 1984. When that contract expired, Racing Tasmania offered to renew Mr Matthews' employment on the basis of a twelve-month contract. After some hesitation Mr Matthews reluctantly accepted the offer. He hesitated because of an expectation, based on representations allegedly made to him before he signed the first contract, that Racing Tasmania would automatically offer him a three-year extension. Shortly after he agreed to accept the second contract, Racing Tasmania told Mr Matthews that, in adopting a practice called "cross-coding" or "multi-coding", it would henceforth require him to work as a steward for the thoroughbred and harness racing councils. He was to perform those duties in addition to his Greyhound Racing Council functions. At a meeting of all stewards Mr Matthews informed Racing Tasmania that he could not undertake the new duties because he had a phobia of horses. Further discussions occurred between Mr Matthews and the authority. He agreed that he could do office work associated with the thoroughbred and harness racing councils, provided he did not have to work directly with horses or attend race meetings. Those arrangements were put to Racing Tasmania. However, after considering the proposal, the authority decided that Mr Matthews' contract of employment should be brought to an end. Mr Matthews received two weeks' notice of his termination. Mr Matthews alleged that his termination was for an invalid reason in that: The authority unilaterally varied the terms of his contract of employment. His termination was unlawful in so much as he was unable to perform the extra functions required of him because of a disability, ie a phobia of horses. The Director of Racing (Mr D H Peters) had no statutory power to terminate his contract of employment. By way of remedy Mr Matthews applied for reinstatement. Appearances When the matter first came on for hearing in Hobart on 1 December 1998 Ms J Davidson, a legal practitioner, appeared by leave of the Commission for the applicant. Mr C Willingham appeared with Mr D H Peters for the "employer". Having regard to what follows I assume the "employer" is or was Mr Peters, as Director of Racing, acting as the delegate of the Minister Administering the Tasmanian State Service Act 1984. Approach The parties acknowledged at the outset that, should the Commission find that the Director of Racing did not have the power to terminate Mr Matthews' employment, there would be no need to consider his remaining contentions.1 However, as a matter of procedural utility, I subsequently accepted the applicant's submission that I should hear all the evidence. Nevertheless, it is clear that the first consideration in this matter is the scope of delegated power possessed by the Director of Racing. I now proceed to determine that question. Did the Director of Racing have the power to terminate the applicant's employment? J Davidson for the applicant: The applicant accepts that the Director of Racing possessed power to appoint him as a stipendiary steward. However, he does not accept that the Director had power to terminate his employment. In that regard, there is nothing in the Acts Interpretation Act 1931 that assists the respondent. That is because subsection 5(3) of the Tasmanian State Service Act 1984 expressly provides that, where there is any inconsistency between that Act and any other, the former Act takes precedence. Section 11(1AA) of the Racing Act 1983 provides that "Subject to and in accordance with the Tasmanian State Service Act 1984 such persons may be appointed or employed as may be necessary ...". The enactment talks about appointment. It does not mention termination at all. Section 40A of the Racing and Gaming Act 1952 enacts provisions to protect stipendiary stewards from undue influence. Subsection 40A(1) permits Racing Tasmania to appoint a stipendiary steward. Subsection 40A(3) deals with termination:
When it terminated Mr Matthews' employment, Racing Tasmania did not suggest that the authority no longer required his services because of the appointment of another stipendiary steward. In the circumstances, subsection 40A(3) does not apply to the facts of this case. The Racing Act 1983 and the Racing and Gaming Act 1952 both create the power to employ a stipendiary steward. However, apart from subsection 40A(3) of the Racing and Gaming Act-which has no application in the present case-neither enactment contains a power to terminate the employment of a stipendiary steward. The respondent purported to appoint Mr Matthews under the provisions of section 38(1) of the Tasmanian State Service Act 1984. That enactment provides for temporary employment and section 38(1) expressly deals with the power to employ. Subsection 38(7) expressly deals with the power to terminate the employment of temporary employees, subject to any relevant award. That power resides in the Minister, the Head of a relevant Agency or other persons referred to in subsection 38(2). Subsection 38(2) enables the Minister, by instrument in writing, to delegate-
Sections 3 and 28 of that Act define "Head of an Agency" by reference to Schedule 1. There is no reference in Schedule 1 to Racing Tasmania. If the Director of Racing is to have the authority asserted by the respondent, there must be some chain of connectivity in the written delegations that goes through at least one of the Government departments listed in Part 1 of the Schedule. There does not appear to be such a chain. In the circumstances, only the Minister possessed the power to terminate Mr Matthews' employment. That is because, in the absence of any evidence to the contrary, subsection 38(2) does not enable the Minister to delegate that power to the Director of Racing, a position that is not a "Head of an Agency" within the meaning of the Act. In any event, section 38(2) expressly refers to "the power to employ persons ... and to terminate the employment of persons so employed." The provision clearly separates the power to employ from the power to terminate employment. The respondent's contention-that the power to employ includes the power to terminate employment because of the operation of the Acts Interpretation Act 1931-ignores the separation of the two powers. Clause 8 of Mr Matthews' contract of employment is a remedy provision. The wording of the clause seems to assume that, elsewhere in the contract, there is another clause that provides for termination. However, there is no express power of termination in the contract and no reason for the Commission to imply the existence of such a power. In any event, it was not open to the Director of Racing to assign to himself a power not delegated to him by the Minister. The respondent should be bound by the contract that it proffered to Mr Matthews. If there is any ambiguity in the contract then, as a matter of contract law, its terms should be construed against the party that proffered the document. In this case it was the respondent's responsibility to ensure that the contract was free from ambiguity. Accordingly, the contract should be interpreted against the respondent. C Willingham for the respondent: The Administrative Arrangements Order 19972 assigned to the Department of Primary Industry and Fisheries the responsibility for administration of, among other Acts, the Racing Act 1983. On 24 July 1997 the then Minister for Public Sector Administration, by written Instrument of Delegation, made the following delegation (so far as it concerns these proceedings) in respect of the Department of Primary Industry and Fisheries:
For purposes of this case the relevant Schedule was Schedule B in which the authority delegated appeared in the following terms:
The list of offices or positions to which Schedule B applied expressly included, among others, the Director of Racing. Regarding that delegation the respondent's legal advice is that there is doubt about whether a power to employ, delegated pursuant to section 38(1) of the Tasmanian State Service Act 1984, also includes a concomitant power to terminate employment. However, the advice of the then Commissioner for Public Employment (with which Mr Willingham, as Director of Industrial Relations, concurred)3 is to the contrary. That is, because of the operation of section 21(1) of the Acts Interpretation Act 1931-which should be read in conjunction with section 38(1) of the Tasmanian State Service Act 1984-a delegation of the power to employ does in fact include the power to terminate employment. Any suggestion that the Acts Interpretation Act 1931 does not have an over-arching effect on the Tasmanian State Service Act 1984 misconceives the primacy of statute law in this State. Section 21(1) of the Acts Interpretation Act 1931, so far as is relevant for present purposes, provides that:
Accordingly, in the absence of anything to the contrary, section 21(1) of the Acts Interpretation Act 1931 is sufficient to ensure that a delegation of power to employ, as expressed in section 38(1) of the Tasmanian State Service Act 1984, includes a power to terminate employment. However, if the applicant is correct in arguing that the termination is invalid then, by extension and by definition, Mr Matthews' contract of service must also be invalid. That is to say, if the respondent did not have the power to terminate Mr Matthews' employment, it did not have the power to employ him in the first place. There is clear power under subsection 40A(3) of the Racing and Gaming Act 1952 to terminate a stipendiary steward. The respondent's legal advice is that, although curiously worded, it is not reasonable to assign to it the interpretation for which the applicant argues. Subsection 40A(1) creates a power, but not an obligation, to appoint. It would be an extraordinary interpretation of subsection 40A(3) in the circumstances to suggest that, once appointed, it would then be impossible to remove one steward without appointing another. Such an interpretation is clearly inconsistent with the objects of the Act and the intention of Parliament. Furthermore, and most importantly, Clause 8 of Mr Matthews' contract of employment makes provision for termination. That provision commences with the words "Should the appointment be terminated by the Director of Racing prior to the expiration of the term for any reason other than serious misconduct ..."4 There is no ambiguity at all about that power. In any event, even if there is some deficiency or ambiguity in the contract of employment, the respondent does not accept the proposition that the onus for getting it right rests with the employer. The fact is that it takes two parties to make a contract. In the present case the contract only came into being with considerable reluctance on the applicant's part. Mr Matthews took time to consider the document before agreeing to its terms. His evidence is that he understood its terms although he did concede that perhaps he should have given the contract a second look.5 In the circumstances, Racing Tasmania is not culpable merely because the applicant was not fully aware of his contractual obligations and rights. Findings The evidence satisfies me that the Minister's 24 July 1997 delegation of his power under subsection 38(1) was an effective exercise of the power vested in him to that effect by subsection 38(2) of the Act. I note the applicant did not question the validity of that delegation in so far as it concerned the capacity of the Director of Racing to employ him as a stipendiary steward. One is left to wonder, however, why the Instrument of Delegation expressed the power as an authority "to appoint"-which the Tasmanian State Service Act appears to use in relation to permanent employees rather than contract or temporary employees-whereas the power expressed in subsection 38(1) is "to employ". In any event, should there be doubt, it is arguable, in my opinion, that the delegation clearly promoted the purpose or object of the Tasmanian State Service Act 1984.6 It follows in my view that, among other things and for present purposes, the parties' execution of the second or twelve-month contract established an employer and employee relationship between them-that is to say, between the Director of Racing on behalf of the Crown and Mr Matthews. The facts disclose that one of the issues between employer and employee, or former employee, in these proceedings is the employer's capacity to terminate Mr Matthews' employment. In the circumstances I find that, having regard to the provisions of section 3(1) of the Industrial Relations Act 1984, an "industrial dispute" exists between the parties about an "industrial matter". The evidence shows that Racing Tasmania, through the Director of Racing, employed the applicant, as subsection 11(1AA) of the Racing Act 1983 obliged it to do, in accordance with the Tasmanian State Service Act 1984. The authority did not dispute that fact. Nevertheless, Ms Davidson put some effort into considering section 40A (Appointment of stipendiary stewards by Authority) of the Racing and Gaming Act 1952, particularly the termination provisions of subsection 40A(3). She did so for the purpose of arguing that the provision did not apply to the facts of the present matter. While I have come to the conclusion for which Ms Davidson contended, I have done so for different reasons. The facts clearly show that Racing Tasmania did not appoint Mr Matthews under section 40A of the Racing and Gaming Act 1952. Subsection 40A(3), however, has application only "Where a stipendiary steward is appointed under this section ...". Accordingly I find that, as a matter of fact, the provision did not apply to Mr Matthews. That is because the authority did not appoint him under section 40A of the Racing and Gaming Act 1952, but under subsection 38(1) of the Tasmanian State Service Act 1984. It is not clear to me if it was Mr Willingham's submission that subsection 40A(3) actually empowered the Director of Racing to terminate the applicant's employment in the present circumstances. If that was his contention, I reject it for the reasons already mentioned. I now turn to the respondent's contention that the Minister's delegation to the Director of Racing included a power to terminate employment by reason of section 21(1) of the Acts Interpretation Act 1931. In considering this issue I observe, as a matter of caution, that it is not the Commission's task to exercise a judicial function, ie to purport to interpret legislation or to make declaratory statements as to what the law might be. However, in exercising its jurisdiction to "hear and determine any matter arising from, or relating to, an industrial matter"7 it is permissible for the Commission to form an opinion as to the meaning of any applicable legislative enactment. That is the approach I take in the present matter. I begin with the Tasmanian State Service Act 1984. The scheme of the Act in so far as it concerns temporary employment is quite clear. Subsection 38(1) empowers the Minister on behalf of the Crown to employ persons for a specified period or on either a general or special contract of service. Subsection 38(7) empowers the Minister, and other persons to whom he may delegate that power, to terminate the employment of persons employed under subsection 38(1) of the Act. Subsection 38(2) empowers the Minister, by instrument in writing, to delegate to certain persons the power to employ persons in a temporary capacity and to terminate the employment of persons so employed. It is plain that, in relation to temporary employment, the Act expressly creates separate powers: a power to employ-subsection 38(1)-and a power to terminate that employment-subsection 38(7). Subsection 38(2) expressly enables the Minister, at his or her discretion, to delegate either or both those powers, since each is specifically and separately mentioned in that provision. The Minister's written Instrument of Delegation (above, page 4) plainly states that it was made pursuant to, among other sections but relevantly for present purposes, subsection 38(2) of the Tasmanian State Service Act 1984. The power thereby delegated, again among others but relevantly for present purposes, is that contained in subsection 38(1), ie the power to employ persons in a temporary capacity. Schedule B (above, page 5), to which the Minister's delegation refers, is consistent with that authority in that it specifically delegates the power "to appoint Temporary Employees in accordance with Section 38(1) of the Tasmanian State Service Act 1984". I pause here to mention a point that I discussed earlier regarding the wording of this authority (above, page 6). I assume that, at least for present purposes, the words "to appoint"-as used in the delegation-are synonymous with the words "to employ"-as used in subsection 38(2) of the Act. Returning to the Instrument of Delegation, it is apparent that nowhere in the recitals or in Schedule B is there to be found a reference to subsection 38(7) of the Tasmanian State Service Act, ie the power to terminate the employment of persons employed in a temporary capacity. Prima facie the Instrument of Delegation contains no expression of intention on the part of the Minister to delegate the power to terminate the employment of persons employed under subsection 38(1) of the Act. In my opinion it is not open to imply the existence of such a power in the delegation, since subsection 38(2) specifically requires such a delegation to be in writing. However, the respondent's contention is that the Instrument of Delegation effectively contains the power to terminate employment because of the operation of section 21(1) of the Acts Interpretation Act 1931 (above, p. 5). That is to say, in short terms, a power to make any appointment to an office or a position includes a power to remove a person appointed under that power. The scheme of the Tasmanian State Service Act 1984 however, as noted already, specifically and expressly provides separate heads of power enabling the employment and the termination of employment of temporary employees. In my opinion, there is no need to resort to section 21(1) of the Acts Interpretation Act 1931 to find or clarify the existence of a power to terminate the employment of temporary employees appointed under the Tasmanian State Service Act. That is because section 38(7) of that Act clearly expresses such a power. I find support for that conclusion in subsection 4(1) of the Acts Interpretation Act, which, as to application of the Act, provides that:
In all the circumstances I do not accept the respondent's contention that section 21(1) of the Acts Interpretation Act 1931 applies in the present case to "ensure that a delegation of power to employ, as expressed in section 38(1) of the Tasmanian State Service Act 1984, includes a power to terminate employment".8 Accordingly, I find that the Director of Racing did not derive the power to terminate the applicant's employment from the Minister's Instrument of Delegation of 24 July 1997. That finding brings me to Clause 8 of the applicant's contract of employment. The respondent placed considerable weight on this provision as expressing a power of termination that the Director of Racing ultimately exercised in bringing Mr Matthews' contract to an end. While the wording of the provision is clumsy, I believe its intention is clear enough to permit me to safely conclude that the proper construction of Clause 8 implies a power of termination. However, that finding does not, in my view, improve the respondent's position vis-à-vis the termination of Mr Matthews' contract of employment. I have already found that the Minister did not delegate to the Director of Racing his power to terminate the employment of persons employed pursuant to subsection 38(1) of the Act. However, that is not to say that Racing Tasmania's employment of the applicant might not otherwise have been effected on terms directly approved by the Minister. In the circumstances, a direct approval by the Minister of the terms set out in Mr Matthews' contract of employment, particularly Clause 8, would in my opinion vest in the Director of Racing the power to bring the contract to an end. However, no such evidence was put to me and there is nothing on the face of the document itself that suggests the Minister directly and specifically approved the terms set out in the applicant's twelve-month contract of employment. The evidence satisfies me that, in the absence of a relevant Ministerial delegation of power or specific approval of the terms of Mr Matthews' contract of employment, it was not open to the Director of Racing to purport to give himself the power to terminate the applicant's contract of employment. In other words, in the absence of direct Ministerial approval of the terms of Mr Matthews' contract of employment, the inclusion of a termination power in Clause 8 was ultra vires the Minister's 24 July 1997 delegation of authority to appoint temporary employees. I find to that effect. Conclusion Having regard to the parties' submissions and evidence and after taking into account the foregoing discussions and findings I have come to the following conclusion. I find that the Director of Racing did not have the power to terminate the applicant's employment. Consequently, I believe the purported termination was void ab initio. Because of that finding I do not find it necessary to consider the other grounds upon which the applicant relied in these proceedings. Order Ms Davidson did not give me the benefit of any submissions regarding the form and substance of the order sought by her client in the event that the Commission should decide this issue in his favour. I noted earlier that Mr Matthews claimed reinstatement. However, in light of my finding that the purported termination was void ab initio, reinstatement is plainly inappropriate because, in effect, there was no termination. Because there was no actual termination of employment it follows, in my view, that the dispute that comprises these proceedings is not "an industrial dispute relating to termination of employment" as contemplated by section 31(1A) and 31(1B) of the Industrial Relations Act 1984. In those circumstances, I now turn my attention to section 31(1) of the Act, which provides that:
After hearing the parties' submissions and considering the views put to me, I have formed the opinion that I should make the following order in settlement of the industrial dispute that comprises the subject of these proceedings: ORDER PURSUANT TO the power conferred on the Commission by Section 31(1) of the Industrial Relations Act 1984 I HEREBY ORDER that the respondent employer, Mr David Hamilton Peters, Director of Racing, as the delegate of the Minister Administering the Tasmanian State Service Act 1984, in full and final settlement of the industrial dispute referred to in application T No 8060 of 1998, comply with terms of the General Contract of Service executed by him as Director of Racing-SAVE AND EXCEPT so much of Clause 8 of that Contract as was beyond the power delegated to him by the Minister-for the purpose of employing Mr Ronald Denham Matthews as Chairman of Stewards - Greyhound Racing for a period of one year commencing on 19 September 1998 and terminating on 18 September 1999.
B R Johnson Appearances: Date and Place of Hearing: 1 Transcript 1/12/98, p. 15. |