IN THE TASMANIAN INDUSTRIAL COMMISSION

Industrial Relations Act 1984

REASONS FOR DECISION

DATE AND PLACE OF HEARING:

27.08.85                      Hobart
30.10.85
01.11.85
04.02.86

The Commission has for determination two appeals against the decision of Mr. Commissioner Gozzi, dated 19 July 1985. In that decision he decided to exempt from award coverage a number of bodies or agencies collectively referred to as the Association of Christian Care Agencies.

The appellants in these matters are the Australian Social Welfare Union, Tasmanian Branch, and the Federated Miscellaneous Workers' Union of Australia, Tasmanian Branch.

Appeal notices were drawn in identical terms and filed with the Registry on 8 and 9 August 1985. Unfortunately determination of these complex applications has taken some considerable time. Apart from the complexities involved, delay has been due to a combination of factors, including the heavy workload on individuals and the consequent inability of all members of this Bench to give uninterrupted consideration to the great volume of material before us.

Having now applied our minds to all matters relevant to these appeals, we are in a position to publish our reasons for decision which now follow.

BACKGROUND TO APPEAL

It appears that at various dates in 1984 attempts were made by the appellants in these matters to secure award coverage for "community service workers" in accordance with the provisions of the now repealed Industrial Relations Act 1975.

In the event, although it was apparently resolved that an award would be made to take effect on 1 April 1985, in fact this did not occur. Moreover, no part of earlier proceedings came forward to this Commission in accordance with the transitional provisions set out in the Industrial Relations Act 1984.

In due course, however, an application came before the Commission for de novo consideration of those issues said to have been either resolved or to have been in need of resolution at the conclusion of proceedings in 1984.

The matter was assigned to Commissioner Gozzi in accordance with Section 15(1)(a) of the Industrial Relations Act 1984. After nine sitting days of hearing the Commissioner announced his findings on what was, in reality, a threshold issue regarding exemption or non-exemption of certain members of the Association of Christian Care Agencies. It is clear to us that the exemption given was from the entire operation of any award he may make at some later date. In fact it was the application seeking such an award that was used as a vehicle for consideration and determination of the issues giving rise to these appeals.

In passing, it could be said that the question of exemption or otherwise from a proposed Community Services Workers' Award was apparently the subject of much debate in 1984, but had not been resolved when proceedings concluded in 1984.

It is against Commissioner Gozzi's decision on the narrow question of exemptions that these appeals have been taken.

In determining the issue, the Commissioner decided to exempt all nominated members of the Christian Care Agencies in respect of whom application was made by the Tasmanian Chamber of Industries.

At pages 25 to 26 of his decision of 19 July 1985, under the heading "Conclusion", the Commissioner said:

"I have endeavoured to canvass the main aspects of this matter which I consider particularly important in reaching my decision that the Association of Christian Care Agencies should be permitted to have award-free operation in those areas sought to be covered by the proposed "Community Services Award" if that award should be made in future 1."

"I summarise my reasons for decision as follows: -

1. It would be contrary to the public interest to burden A.C.C.A. with increased financial hardship with the distinct possibility that increased labour costs will result in curtailment of community services. In this regard I place great weight on the evidence of Father Kilby and Mr. Batchelor.

A.C.C.A. agencies operate within extremely tight financial parameters, and there is no guarantee that outside funding, e.g. limited government funding, will be readily made available to offset increased costs. The philosophy of A.C.C.A. and their desire to remain essentially autonomous must also be respected here.

2. The underlying philosophy of A.C.C.A. is that emphasis is placed on the recipients, rather than on the providers, of the services. The evidence suggests that those persons providing the services identify strongly with this philosophy and the underlying "contributing" spirit. It would again be contrary to the public interest if award regulation impinged on this entrenched and identifying philosophy and the choice that Christian Care agencies provide to the community, and particularly those who are in need of the range of services provided.

3. The persons employed by A.C.C.A. readily accept the present arrangements where rates of pay are ultimately determined by capacity to pay. There was no evidence of any discontent of any kind that standard conditions, such as penalty rates, were not presently being paid. There was no evidence of any exploitation of any kind and I concluded that the agencies are caring employers, well tuned to the needs of their employees. I do not consider that I should interfere with the general caring and harmonious relationship that currently exists.

For the above reasons I am of the opinion that it would not be in the public interest to determine that the existing arrangements in the Christian Care Agencies as represented by A.C.C.A. should be altered by including them as respondents to a Community Services Award (if in fact an award is indeed made)."

The appeals were prosecuted on the following grounds:

1. The conclusions of the Commissioner are not supported by the evidence and were not reasonably open to him upon the material before him.

2. The findings of fact made by the Commissioner are not supported by the evidence.

3. The Commissioner erred in that he determined the threshold matter without proper regard for the onus which lay upon the parties seeking the exemption.

4. The Commissioner erred in that he failed to have proper regard for the totality of the evidence and submissions placed before him.

5. The Commissioner erred in that he failed to have proper regard for proceedings previously conducted in accordance with the law.

6. Such further or other reasons as the Commission may deem fit.

Each of the appellants presented vigorous argument in support of grounds set out in their respective appeal documents. In addition, the Secretary of the Tasmanian Trades and Labor Council intervened in support of the appellants. And while debate ranged across the whole of the Commissioner's decision, it would be true to say Ms. Fox and Mr. O'Brien placed great emphasis on their assertions that the Commissioner transgressed beyond the levels of the discretion reposed in him in upholding the request for exclusion on grounds related to incapacity to pay.

It was also argued before us that Commissioner Gozzi erred in attaching the weight indicated in his decision to "the underlying philosophy of the A.C.C.A.", which we understood him to interpret to include "those persons (employees and volunteers) providing the services (who) identified rather strongly with this philosophy and the underlying contributing spirit".

In this regard the Commissioner concluded:

"It would again be contrary to the public interest if award regulation impinged on this entrenchment and identifying philosophy and the choice that Christian Care agencies provide to the community, and particularly those who are in need of the range of services provided."

In addition we were referred to apparent conflict in Commissioner Gozzi's finding on the question of employer attitude, or agency attitude, to the notion of award regulation in the areas exempted by the Commissioner from future award regulation.

In this regard we tend to agree that some confusion appears to exist although not to an extent sufficient to find that the Commissioner necessarily misdirected himself. There was evidence that some agencies are already bound by rates and conditions prescribed by common rule or general application awards.

To a greater or lesser extent it would appear some agencies tend to observe or adapt private industry and Public Service Awards while others may well be award free.

However we have been unable to discover whether the Commissioner would have been prepared to exempt certain agencies from existing award coverage.

Other supportive arguments were presented but were, we believe, of lesser importance than those to which we have referred.

Mr. Lennon, for the T.T.L.C. (intervening), largely reiterated the arguments of Ms. Fox and Mr. O'Brien. He also submitted that the Commissioner should have dealt with the application for an award first and considered questions of exemption later. It was not to the point, he submitted, that present employees might be content with their existing (non-award) wages and conditions, and that therefore no future award coverage should be ordered. He argued that future employees may not be content with this arrangement and posed the rhetorical question: "What would the position of the Commission be in those circumstances?"

Mr Fitzgerald, appearing for the respondents to these appeals, stoutly defended the decision taken by Mr. Commissioner Gozzi.

Among other things he submitted:

"It is my submission that both appellants have clearly missed the thrust of our submissions at the hearing at first instance."

And later, in response to a question from the Bench:

"Yes, certainly I understand what you are saying, but in general industrial terms an incapacity-to-pay case requires that the books of account are in fact open for complete inspection.

We were simply not attempting to prove that exercise in any way at all.2

Clear evidence was presented and properly accepted by Commissioner Gozzi that the effect of an award would curtail services and this would offend the public interest criteria of the Industrial Relations Act 1984, because simply the needy and suffering of our community would be disadvantaged.

I would submit that it was not necessary to present a fully-scaled incapacity-to-pay argument as was suggested by the appellants."3

Transcript, pp.334-335

Mr. Fitzgerald reminded the Commission that in the original proceedings emphasis had been laid on the likely effect penalty payments would have on agencies bound to observe the terms of any award to be made. He said:

"Now there was costing which was completed by one of the agencies concerned. That was Centacare, which indicated a clear increase would apply in respect to the clerical employees.

In my submission it would have been impossible to make a precise financial assessment of the effect of the proposed award.4

But without going into the history of the proceedings before this jurisdiction, there is a natural presumption, I believe, which could be relied upon to indicate that if an award came into existence the actual rates of pay and conditions sought by the unions would, I suggest, be aligned somewhere in the public sector.

Now the problems which were identified by the Christian agencies before Commissioner Gozzi were those aspects particularly relating to penalties. And I am talking about overtime, Saturday, Sunday work etc."

Transcript, p.340

He then submitted that the evidence clearly showed at the hearing at first instance that "it is the norm for employees of the agencies to respond to the needs of their clients."

We take this to mean that if help is required it is given, regardless of the time of the day or the day of the week. Therefore if penalty rates were to be prescribed for "call out" (our terminology), the consequential financial burden on agencies would be such as to necessitate curtailment of services.

Mr. Fitzgerald also made passing reference to a question from the Bench directed toward identification of the "industry of the employer."

And in relation to the matter of the general philosophy of the agencies, and the fact that that same philosophy was accepted and embraced by employees of Christian Care agencies, Mr. Fitzgerald submitted:

"I now wish to turn to the philosophical arguments which have been presented by the appellants.

It will be my submission that extensive evidence was led by the Association agencies and referred to in Commissioner Gozzi's decision, and in my submission it was properly assessed by Commissioner Gozzi and properly open to him on the evidence.

I would like to refer to Commissioner Gozzi's decision at page 21, and I quote from the top of the page -

`This specific issue was raised with Father Kilby who left no doubt in my mind as to the acceptance and commitment of employees to the philosophies expressed.

Father Kilby said: "So it is a very general kind of philosophy which may be seen by some in a good secular sense that it is good to do things for people, but there is no antipathy or antagonism or conflict in relation to the basic philosophy of the agency."'

On the material presented to me I am also of the opinion that in terms of remuneration the philosophy is accepted by the vast majority of employees."

Transcript, pp.342/343

Mr. Fitzgerald rejected Mr. O'Brien's assertion that market forces would determine the level of funding available to non-profit agencies of the kind considered by the Commissioner. He said Commissioner Gozzi did not take this factor into account, as non-profit organizations expended all their funds in giving assistance to the needy.

As mentioned earlier, other matters were debated before us including the alleged status of earlier proceedings conducted before the (then) Assistant Deputy Chairman of Industrial Boards, Mr. Holden. It was argued by the appellants and refuted by the respondent that Commissioner Gozzi should have had regard for the detail and agreement reached in relation to earlier matters that had been before Mr. Holden.

We dispose of this aspect by indicating now that while it may have been within the Commissioner's discretion to accept or reject this information, we do not believe he was in any sense obliged to consider himself bound by past events. The simple fact is that no award carried forward to the Commission. Earlier proceedings before another tribunal which resulted in no award, order or valid agreement being made, has no binding force upon this Commission.

We therefore reject item 5. of the appeal documents to the extent that it was relied upon as a foundation simpliciter for these appeals.

As to the remaining grounds, we find as follows:

Grounds 1 and 2:

We are of the opinion that the Commissioner erred in accepting as fact what amounted to suppositious assertion regarding possible curtailment of services as a direct consequence of additional direct labour costs. Those costs he concluded could result from an obligation by agencies to meet higher salaries and penalty payments due to award regulation.

It is clear to us that before there could be any such finding of fact sufficient to justify the wide-ranging exemptions granted by the Commissioner, there would first need to be a proper costing. That costing would need to be factual and based upon an established award or agreement identifying salary rates, overtime or other penalty payments, along with employment conditions binding upon employers and employees in the industry. In truth no such award or agreement exists.

We believe the error becomes more manifest when regard is had for the fact that it was then, and remains now, the prerogative of Commissioner Gozzi ultimately to decide to make an award or to refuse to make an award covering the industry. And here we assume, without being called upon to so decide, that the definition of "industry" and the definition of "private employer" in the Industrial Relations Act 1984 would have application to all the agencies sought to be covered by any award to be made.

Moreover, if salary rates, penalty payments or other employment conditions likely to be included in any award were individually or in combination considered to be contrary to the public interest, because agencies would be unable to meet award obligations without curtailment of services to needy people, that would surely be a factor to be considered at the time a decision was being taken as to whether an award should be made or not.

We fail to see how the question of exemption could have been decided in vacuo, supported only by assumed information about costs, funding, likely curtailment of services and other considerations. Without there firstly being established an award upon which to base actual costing, we think any other conclusions would, of necessity, border on the speculative.

Ground 3:

We tend to agree that no objection was raised by the appellants to the question of future exemption being determined as a threshold matter, and in this regard we sympathize with the Commissioner. But having put the Commissioner in this invidious position, the very heavy onus of proving a case which then rested upon the applicants, in those unusual circumstances, was not discharged. As it was, the evidence was necessarily based upon no more than apprehension and supposition. We reject this approach and find in favour of the appellants.

Ground 4:

We cannot accept the assertion that the Commissioner failed to take account of the totality of evidence before him. We do agree, however, that on the whole of the evidence available he fell into error in assuming services could or would be curtailed by all agencies. Evidence relating to such agencies was scant and unsupported by fact.

Ground 6:

We find no settled doctrine of industrial practice that would lend support to the postulation that Christian or other philosophies, however laudable and however well accepted by the community at large could, or should, per se, found the basis for award exemption.

That is not to say that agencies and employees supportive of those philosophies could not and should not be granted partial or total exemption from any award to be made. But there would need to be more substantial reasons than agency philosophies to sustain such an order for exclusion. However the time to consider that question, including any necessary award modification is, we feel, after the scope and contents of any award have been first determined.

In our opinion it is only then that such questions as incapacity to pay, likely curtailment of services to the homeless, helpless and needy, together with other fundamental questions that might arise from examination of the definitions of "industry" and "employer" can and should be decided.

Accordingly we allow the appeal. We have decided to refer back to the Commissioner the entire question of exemption or exclusion of individual or collective members of what has been referred to as the Association of Christian Care Agencies. As none of these bodies is registered, we also refer back to the Commissioner the question of appropriate identification should he, in the passage of time, decide to make an award which, by its terms, might exclude all or some employers, whether identified as Christian Care agencies or otherwise.

Finally, as we were asked to lay down guidelines to be observed by appellants and respondents to appeals taken against decisions of members of this Commission, we are able to say now that we generally find nothing incompatible with those pronouncements of other tribunals that were referred to us during proceedings by Mr. Fitzgerald. However we do not necessarily adopt all or any of those pronouncements or procedures as our own.

Nevertheless our decision on these appeals is not inconsistent with any of those references. Indeed we borrow some of the words used by Quick D.P. in re Australian Railway Union v. Railway Commissioners (1925) 21 C.A.R. @ 800 when we say that discretionary power is one which should be exercised with care, and then only in cases where it is clear that the degree of discretion exercised is in accordance with the source of power being invoked at the time. In this case Section 21(2)(c) was relied upon in conjunction with Section 36.

1 Underlining ours
2 Underlining ours
3 Underlining ours
4 Underlining ours