T6469
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TASMANIAN INDUSTRIAL COMMISSION Industrial Relations Act 1984 The Community and Public Sector Union
Appeal - decision handed down by Commissioner R J Watling on 8 July 1996 in matter T6226 of 1996 - alleged award breaches - appeal dismissed - decision confirmed REASONS FOR DECISION On 23 May 1996 The Community and Public Sector Union (State Public Services Federation Tasmania) (CPSU) applied to the President pursuant to Section 29(1) of the Act for a hearing in relation to "a dispute with the Minister for Public Sector Management arising from a breach of an award relating to payment of salary". When the matter came on for hearing before Watling C, the Commissioner granted leave to CPSU to amend its application, there being no objection from the respondent Minister. In substance, the amendment added details to the original application to make it clear that the alleged award breaches concern claims for underpayment of salary to two named officers of the State Service, both covered by the Administrative and Clerical Employees Award. There was and is, no contest between the parties concerning the work done by the employees or their respective classification levels. In short form, the basis of the claim is that the employer is paying each of the individual officers concerned at a salary rate less than that prescribed for the relevant classification by subclause (a) of Clause 8 - Salaries of the award. The Order sought by the union, which appears in a CPSU Statement of Contention dated 6 June, takes the following form:
In determining the matter Watling C in effect refused to make the Order, concluding his written Reasons for Decision of 8 July 1996 with the following observations:
It is from this decision that CPSU now appeals pursuant to Section 70(1)(da) of the Act, the grounds as lodged being:
Before us, however, Mr G J Vines, who appeared with Ms S Strugnell for CPSU, proceeded only in respect of grounds 1 to 4 enumerated above. In the course of his submissions Mr Vines directed our attention to principles previously adopted by the Commission in determining appeals of this nature.1 These principles, drawn from the Australian Commission case of "Poon Brothers" 289 CAR 269, essentially reflect those originating in the High Court proceedings of House v The King (1936) 55 CLR 499, concerning appeals against an exercise of discretion. We doubt their appropriateness in proceedings such as the present, which do not concern the exercise of a discretion but require a finding of fact regarding the existence or otherwise of alleged award breaches. Mr Vines began with a brief outline of submissions that the parties put to Commissioner Watling. He then took us through a thorough analysis of the Commissioner's Reasons for Decision, commencing with the following paragraph:
In implying that it was the parties' decision, following point-to-point translation to the new award structure, that employees would "move in stages to the top of the new salary level", Mr Vines submits that the Commissioner did not properly consider the relevant award provision in that he misunderstood and misapplied a fundamental principle relating to the translation process. The firm view of CPSU, Mr Vines says, is that the translation process outlined in Annexure A of the award is a mechanism that concerns only the instant of translation, with no continuing life, necessarily, beyond that instant. Mr Vines contends that CPSU took pains to inform the Commissioner that the purpose of Annexure A was to accommodate the "initial" translation of employees as at 1 March 1996.2 The Commissioner's reference to progression, i.e. "move in stages" , Mr Vines argues, appears to arise from the following Explanatory Note (one of four) contained in Annexure A:
This arrangement, Mr Vines submits, is solely for the protection of certain employees who might otherwise suffer disadvantage by having their salary horizons reduced: its purpose is not to lessen an employee's entitlements. Furthermore, Mr Vines argues, there is nothing in Clause 14 - Award Translation, the provision incorporating Annexure A, that gives it precedence over Clause 8(a). Annexure A is clearly of lesser status than Clause 8(a). In other words, he says, if a classification level determined pursuant to Clause 8(a) is different from that which arises from the translation process, Clause 8(a) must prevail if it provides a greater benefit for the employee concerned. Mr Vines strongly asserts that the purpose of the point-to-point translation process was simply to move employees across to the new salary structure. Thereafter, he says, continued operation of the process depends upon the new classification level and position description being correct. In circumstances where those elements are not correct, the new classification standards set by Clause 8(a) will apply. In such cases, Mr Vines contends, there is one classification for purposes of translation and another that arises subsequently by reference to the classification standards prescribed in Clause 8(a). The above explanation, Mr Vines emphasises, reflects the spirit and intent of all the parties' discussions about translation provisions. The issue, he says, is not about how progression applies, but the circumstances in which it applies. For these reasons, he submits, Watling C erred in that, in misunderstanding and misapplying a fundamental principle relating to translation of employees across to the new salary structure, he did not properly consider the relevant award provisions. Mr T Pearce responded for the Minister for Public Sector Administration. He submits that while Clause 8(a) of the award provides that "An employee appointed to a position classified under this award shall be paid at the salary rate applicable to a level determined in accordance with the classification standards set out in this clause." Clause 14, which concerns "Award Translation", is an equally relevant provision because it directs that:
Mr Pearce submits that Annexure A is a valid part of Clause 14. For that reason, he says, the Annexure is no less compelling than Clause 8(a). Mr Pearce contends that, in considering Clause 14 and Annexure A in relation to Clause 8(a) and concluding, in effect, that the former act as a fetter on the otherwise specific intent of the latter, the Commissioner did not err. Our first point, regarding this ground of appeal, concerns Annexure A. Mr Vines encourages us to accept the view that, since Annexure A attaches to the award because of its incorporation by reference in Clause 14, it is in some way an inferior or lesser award provision than Clause 8(a). In this regard we observe that incorporation of documents by reference into industrial awards and, indeed, into a wide variety of legal instruments generally, is a common drafting - even legislative - device. Many such documents appear as schedules, appendices or, as in this case, an annexure, simply because they contain items more conveniently set out in tabular or list form at the end of a particular instrument rather than within its body. In our view, in the case of industrial awards, the method that parties use to deal with particular award content does not, for that reason alone, detract from or diminish its substance. That content, in our opinion (provided the award is properly made) and contrary to the view expressed by Mr Vines, is as much a part of the award and equally as enforceable at law as, in this instance, Clause 8(a). The next point we make is this. The great weight of submissions put to us (and to Commissioner Watling at first instance) directs our attention to the parties' understanding, or view or intention concerning application of Annexure A and, in particular, application of the Explanatory Note quoted above at page 3 in relation to the translation process. To some extent we think these submissions tend to misunderstand our function. Our task, as was that of Commissioner Watling, is to determine as a matter of fact, on the evidence, whether the employer is in breach of, in this instance, the Administrative and Clerical Employees Award. It is not our task, nor was it the task of Commissioner Watling, to interpret the meaning at law of Annexure A. In that context, what was in the parties' minds at the time of their agreement concerning the translation process, or what each or both of them intended or understood would be the practical outcome of that agreement, is not germane to the issue at hand. We, like Commissioner Watling, can only look at the terms of the award and form a view on that basis: it is not open to us, nor was it to him, to consider the meaning of those terms by reference to materials or evidence extraneous to or outside the award itself. While these observations are relevant to the objection Mr Vines took to the tendering by Mr Pearce of Exhibit P1,3 the debate about Exhibits V1 and P1, in particular, does not help us resolve the question of alleged award breach. In the above light and remembering our earlier finding that each of the relevant clauses is as much a part of the award as the other, we now move to consider the relationship between Clause 8(a) and Clause 14 with its incorporated Annexure A. Clause 14 is quite clear and unambiguous in the direction that it contains, i.e. "Positions ... will be translated ... in accordance with Annexure A of this award." Annexure A contains two translation guidelines, but the one that concerns these proceedings is "Guidelines for Clerical Translation". Appended to those Guidelines are four "Explanatory Notes" - somewhat misnamed, we think, because far from being merely explanatory they are, for the most part, mandatory directions to the employer on how to effect certain translations. The third such Note, quoted earlier, is the important provision for purposes of these proceedings. It is helpful to quote again the operative parts, i.e. "Persons employed in positions on lines ... translate to the next highest salary point. Such persons will progress to the top of the new level ...". Setting aside, as we must, any debate about the parties' intentions concerning the meaning of these instructions, the words used, on their face, appear to be straightforward and unambiguous. Indeed, on the evidence before us, CPSU does not dispute that the employer translated the employees concerned to "the next highest salary point". Although he did not say so, in so many words, we understand that this event comprises the substance of Mr Pearce's submission: in other words, the employer's translation actions demonstrate compliance with the requirements of Annexure A and, hence, Clause 14 of the award. Mr Vines, however, urges us to go further. He says, in effect, that the employer's actions, in the above sense, only go part of the way to meeting the relevant award obligations. That is, they give effect to "the initial" or "point-to-point" translation, which in the circumstances exhausts the effect of Annexure A, but they do not give effect to Clause 8(a). Since neither Clause 8(a) nor Clause 14 is conditional, one upon the other, they are stand alone clauses. As such, Clause 8(a), which has its specific foundation in Section 49(1) of the Act, must prevail over a facilitative provision like Clause 14. The first comment we make about this submission is that Clause 14 is much more than merely facilitative - it is clearly mandatory in that it directs translations to occur in accordance with Annexure A. Even the Explanatory Notes, as we mentioned earlier, comprise for the most part mandatory directions. We do not see any substance in the argument that Clause 14 is inferior or subordinate to Clause 8(a). We next observe that, in our view and contrary to the views expressed by the parties, there is no necessary ambiguity or conflict between Clauses 14 and 8(a) as to permissible outcomes in terms of Section 49(1) of the Act. On this issue Mr Vines argues that, in the absence of specific words to that effect, we (including Commissioner Watling) cannot read down Clause 8(a) or, alternatively, promote Clause 14 above it, so as to reduce the effect of Section 49(1). To the contrary, Mr Pearce argues that Watling C effectively found that Clause 14 acts as a fetter on Clause 8(a), a course that was open to him because "... clause 14 and Annexure A provided a capacity for the employer to depart from the application of clause 8(a) to the extent that the phased translation progression was permissible under the award ...".4 We think both arguments misconstrue the actual effect of Clause 14 and Annexure A. In that Annexure the relevant direction is that persons employed in certain nominated positions will translate to the next highest salary point and thereafter "progress to the top of the new level" - specifically, Clause 8(a) classification Levels 3, 4 and 5. The strong implication here, consistent with other elements of Mr Pearce's submissions,5 is that Annexure A effects, contemporaneously, both a translation and a reclassification. In other words, employees classified under the old award as Classes II, IV, VI and VII translate across to salary levels equivalent to one or another steps in new award classification Levels 2, 3 and 4, not as employees so classified but as employees classified as new Levels 3, 4 and 5 respectively. In our view this must be the outcome because the relevant employees may each "progress to the top of the new level". The practical effect of such a translation is this. The combined translation and reclassification process creates for the particular employees concerned an extended incremental salary scale that, in terms of progression by years of service, is longer than that provided in Clause 8(a) of the award. In the case of Levels 3 and 4, there is one additional annual increment and, for Level 5, up to two additional annual increments. In other words, for employees translated and reclassified according to the relevant Explanatory Note, award Levels 3 and 4 each contain six annual salary increments and Level 5, either four or five annual salary increments. In our opinion the arrangements expressed in Annexure A, in the above context, simply reflect a shorthand method of describing the interim extended incremental salary scales that apply to the relevant employees. As such, they are not ambiguous and they do not conflict with Clause 8(a); rather, for the particular group of employees, they are an integral supplement to that clause. We test our conclusion this way. If, in the relevant Explanatory Note, instead of the words now used there appeared in detail the extended incremental salary scales, the effect of the translation provision, as we describe it above, would not alter. In our view there is no need to either read down Clause 8(a) or promote Clause 14. Because Annexure A acts as a supplement to Clause 8(a) for the purpose of covering special translation and reclassification circumstances, the two provisions stand together and operate without conflict. Consequently, the employer's translation of the employees concerned, in accordance with Annexure A, does not derogate from the obligations imposed by Section 49(1) of the Act because, in fact, the employer is paying the employees concerned the rate fixed by the award for the particular work. It follows, from what we say above, that in our view it is wrong to suggest, as Mr Pearce does, that Commissioner Watling found that Clause 14 and Annexure A operates as a "fetter" on Clause 8(a). We do not think such an approach was open to the Commissioner or indeed us, because a finding of that nature involves interpreting the award as a matter of law, a function that, as we said earlier, is beyond jurisdiction in the present circumstances. In any event, as we read his Reasons for Decision, the Commissioner made no such finding, either expressly or by implication. For reasons discussed above, our view is that the facts of the case before the Commissioner, i.e. alleged breaches of an award, did not require him to go beyond the award itself for the purpose of investigating what was in the parties' minds at the time of their agreement concerning the meaning of, or the principles said to underlie, the translation arrangements referred to in Annexure A. It is, we concede, unclear on the face of his Reasons for Decision what consideration the Commissioner gave to CPSU's submissions regarding Clause 8(a) and its relationship to Clause 14 and Annexure A. However, because the Commissioner's ultimate decision is consistent with our view that there is no conflict between the two award provisions, we are not in a position to say, in terms of CPSU's appeal ground, that he did not properly consider the issue. For these reasons we reject CPSU's contention that Commissioner Watling erred in that he did not properly consider the relevant award provision. Mr Vines' next major contention, on appeal, is that Commissioner Watling seriously erred in not giving due regard, in terms of application and adherence, to the provisions of Sections 49(1) and 85(1) of the Industrial Relations Act 1984 and to Clause 8(a) of the award. A key point of CPSU's case before Watling C, Mr Vines says, is the Union's reliance on the provisions of Section 49(1) of the Act and its relationship to Clause 8(a) of the award.6 In brief, he explains, the Act provides that where, concerning a particular class of work, an award fixes a rate of remuneration, in this case Clause 8(a) of the Administrative and Clerical Employees Award, an employee is entitled to that rate while performing the particular class of work. In addition, Section 85(1) of the Act, in shorthand terms, Mr Vines says, makes provision for an award to prevail over a contract of service so far as there is any inconsistency between the two instruments. Mr Vines contends that, before Commissioner Watling, the Union argued that the translation process agreement between CPSU and the Minister effectively created a contract of employment prior to the award coming into operation.7 In those circumstances, Mr Vines submits, the award must prevail over the translation agreement in cases, such as the present, where the award provides an employee with a greater benefit. Mr Vines contends that the Commissioner's decision gives no indication of what regard, if any, he gave to the above aspects of CPSU's submissions at first instance. Being matters of law, Mr Vines submits, the Commissioner, in exercising a discretion to apparently disregard the submissions concerning Sections 49(1) and 85(1) of the Act, together with the effect of Clause 8(a) of the award, erred in that he purported to exercise a discretion not available to him in the circumstances. Mr Pearce, in reply, concedes that Clause 8(a) of the award and Sections 49(1) and 85(1) of the Act would be relevant considerations if all the Commissioner had before him was "a bald faced failure to pay in accordance with Clause 8(a)." However, he submits, the circumstances of this case are that Clause 14 and Annexure A enable the employer to depart from the specific application of Clause 8(a) to the extent that a phased translation on a non work value basis is permissible under the award. It follows, he argues, that there is no conflict with either Section 49(1) or Section 85(1) of the Act. Accordingly, the Commissioner did not err in his consideration of the relevant parts of the Act put to him by CPSU. From our reading of the Commissioner's Reasons for Decision it seems clear enough that his conclusion or decision rests squarely on the words of the award itself. For that reason, apparently, he saw no need to direct his attention to the Sections of the Act put to him by CPSU since, on his view, at least by inference, there exists no conflict of the type referred to by the Union. On this issue our view, as discussed above,8 is that there is nothing in the translation process, in the circumstances, that calls into consideration the provisions of Section 49(1) of the Act. We mention Section 85(1) of the Act only briefly. While Mr Vines did not "... rely on Section 85(1) to any significant extent ..."9 he did offer the view that the enactment is supportive of the proposition that an award must prevail over matters that are extraneous to it in circumstances where there is a conflict. We do not see how the parties' administrative arrangements concerning translation could amount to a contract of service. But, in any event, given that we believe there is no conflict between Annexure A and Clause 8(a), the point is of little relevance. For these reasons, in the circumstances, we cannot say that Commissioner Watling erred by not giving due consideration to the provisions of the Act. In the matter before us, the grounds upon which the Commissioner chose to resolve the question put to him did not, in the circumstances, require him to then go on and consider CPSU's submissions regarding Sections 49(1) and 85(1) of the Act. For the above reasons we find that, in all the circumstances, Commissioner Watling committed no error in choosing not to give due regard to the provisions of the Act put to him by CPSU. Mr Vines, moving on to CPSU's appeal contention that Watling C did not give due regard to the facts, directs our attention to the following statement in the Commissioner's Reasons for Decision:
He contends that, in placing significant weight on the document referred to as Exhibit P1 (in the proceedings before us, Exhibit V1), Commissioner Watling seriously erred because the document bears no relevance to the present issue. Exhibit V1 is a letter and attachment of 24 May 1993 from the then Acting Director, Public Sector Management Office to the General Secretary, Tasmanian Public Service Association. The attachment, which bears the heading "TPSA APPLICATION - CLERICAL AWARD Sample Translation Showing `Phasing'" sets out a range of sample award translations. The entire Exhibit, Mr Vines submits, originates in different circumstances from the present and relates to a translation process then under consideration by CPSU. The process outlined in the document bears no resemblance to the translation process agreed to by the parties in the current proceedings. Mr Vines explains that, in 1993, CPSU pursued a translation process, known as the standard translation procedure, which matched old classifications with new classifications and contained an anomalies procedure. The Government, he said, opposed that concept from its introduction in 1988 until the start of 1996, when it reached agreement with the Union on an alternative translation process. That alternative translation process, now implemented, rests on the notion of point-to-point salary translation, i.e. the employee concerned moves to the nearest, but not lower, salary level. The process, Mr Vines emphasises, is not the classification based translation process outlined in Exhibit V1. The two translation processes, Mr Vines contends, rely on very different procedures and principles. Accordingly, Exhibit V1 is of no relevance whatsoever in these proceedings. In the circumstances, he says, Commissioner Watling erred in concluding, as a matter of fact, that the document "clearly indicates the intention of the parties" in relation to, in effect, the translation process set out in Annexure A. For the Minister, Mr Pearce argues that Exhibits P1 and P3 (V1 and P1 respectively in these proceedings) are important Exhibits in that they form the basis of Watling C's conclusions. Exhibit P3, he explains, is a Public Sector Management Office document of 30 January 1996 titled "Guidelines for the Translation of Positions to the `Three Stream' Classification Structure."10 The purpose of the Exhibits, Mr Pearce says, was to demonstrate to the Commissioner the nature of the parties' intentions at a point of time in 1993 and at another point of time in 1996. For that reason, Mr Pearce invites us to compare the salary charts attached to each of exhibits V1 and P1. He submits that the translation principle depicted in the 1993 document reflects the same translation principle outlined in the 1996 document, i.e. that "there was a translation process to be put into place which would enable the progression to that new level to take place over time."11 Both Exhibits, he says, were before Watling C and referred to in submissions argued on behalf of the Minister.12 Mr Pearce further argues that, in asking us to dismiss Exhibit V1 as irrelevant, Mr Vines overlooks the fact that the same chart was part of the Full Bench proceedings in T5741 of 1995 that ultimately gave rise to Annexure A and its accompanying Explanatory Notes. Then and subsequently, before Watling C, he contends, CPSU did not take exception to or rebut the notion of incremental progression of employees - indeed, before the Full Bench in the earlier matter the Union appears to endorse the concept.13 Finally, Mr Pearce submits, because of the passage of time since Full Bench approval of the "three streams proposal" in 1991, the translation process and the classification process occurred contemporaneously. When the translation process occurred, he says, most of the classification exercise was complete - it was not as if the translation process would take place on one day and then, at some future time, an all-embracing classification exercise would occur. Mr Pearce submits that the evidence and submissions before Commissioner Watling that tend to show that translation processes described respectively in Exhibits V1(P1) and P1(P3) are one and the same process, properly allowed him to have regard to and rely upon, as he did, the content of what is now Exhibit V1. In the circumstances, Mr Pearce says, the Commissioner did not err in his understanding of the facts put to him. In this context the great weight of CPSU's submissions, before both us and Watling C, went to explaining the Union's understandings and intentions, at the time it agreed to the translation process, about the reasons for, method of application of, and expected outcomes from, that process. We make it very plain, in our discussion above,14 that such matters do not fall for consideration in an application that alleges breach of award - a point that we reiterate here. While Watling C mentions Exhibit P1 (V1 before us), it appears to us that he does so only as a matter of narrative in describing the submissions put to him by Mr Pearce. There is no evidence that he put particular weight, if any at all, on the document. To the contrary, the focus of the Commissioner's decision seems to us to clearly rest on the consideration that he gave to the wording of the relevant Explanatory Note in Annexure A. To our mind that appears plainly enough in the finding set out in the first paragraph of what is, effectively, his decision (see above, at page 1) and the reference he makes in the preceding paragraph to his understanding of the word "progress". It is abundantly clear from the transcript of proceedings before Commissioner Watling, if not from his decision, that he was at all times alert to the fact that his task was not to interpret the award but to determine on the facts, as indeed he did do, whether there was, in the circumstances, a breach by the employer of the award. In the circumstances we reject CPSU's contention that Commissioner Watling erred in that he failed to give due regard to the facts of the matter before him. Turning to his final point of appeal, that Commissioner Watling erred in that he did not give due regard to the law, Mr Vines took us to the last paragraph of Watling C's Reasons for Decision:
The Commissioner's conclusions, Mr Vines argues, were not reasonably available on the evidence and law that he had before him. In so finding, the Commissioner erred in his application of Clause 14 by interpreting it to have a broader effect than the words actually permit. Annexure A, Mr Vines says, is no more than its title suggests, i.e. Guidelines for Clerical Translation. Furthermore, he argues, where there is conflict between such Guidelines and a specific award provision, e.g. Clause 8(a), the specific award provision must prevail. Similarly, if any conflict arises between the Guidelines and specific legislative enactments, like Section 49(1) of the Act, the Act must prevail. In these circumstances, Mr Vines contends, Commissioner Watling erred as a matter of law because the employer, in failing to meet its obligations under Clause 8(a) of the award or by operation of Section 49(1) of the Act, is clearly in breach of the award. At its simplest level, Mr Vines concludes, the basic question incorrectly answered by Commissioner Watling is that which relates to the status of Clause 8(a). The clause, he says, is the principle or dominant award provision that contains nothing to suggest its operation is subject to Clause 14. Furthermore, Clause 14 does not contain any expression to the effect that it operates "notwithstanding Clause 8". In the circumstances, he argues, the award entitles the employees concerned to all the benefits of Clause 8(a). Mr Pearce submits simply that, in his application of the Act and relevant award clauses, Watling C properly applied the law and did not err on that basis. We believe that the approach adopted by the Commissioner in his decision allows us to infer that he took the view that no conflict exists between Annexure A and Clause 8(a) or between the award and Section 49(1) of the Act. The Commissioner's decision also shows that he applied the law in determining the matter before him in that he applied the award provisions themselves. For these reasons we do not believe Commissioner Watling misapplied the law or that he attempted to enlarge the scope of Clause 14 and Annexure A. Our view, as mentioned earlier, is that the course he took in determining the dispute was one reasonably open to him. In the circumstances, we reject CPSU's contention that Commissioner Watling erred in that he did not give due regard to the law in determining the matter before him. In summary, we repeat our finding that, for reasons outlined and discussed, there is no conflict between Clause 8(a) and Clause 14 and Annexure A; rather the provisions of Annexure A, for the group of employees concerned, comprise an integral supplement to Clause 8(a). The two provisions each stand and apply in their own right and operate together without ambiguity or conflict. Consequently, as we said earlier,15 there is nothing in the facts before us that calls Section 49(1) of the Act into operation. As such, the employer's translation of the employees pursuant to Clause 14 and Annexure A fulfils award obligations and does not, in our opinion and in the circumstances, constitute any breach or breaches of the Administrative and Clerical Employees Award. For this reason and others that we advance in response to the appeal grounds put before us, we are firmly of the view that while Commissioner Watling found, in a manner somewhat more direct than the approach we take, that the employer is not in breach of the relevant award, the course he took, nonetheless, was reasonably open to him in all the circumstances. Accordingly, we dismiss the appeal application and confirm Commissioner Watling's decision. Having taken our decision we mention one further matter. At the conclusion of proceedings Mr Pearce informed us, without prejudice, that "... we do accept the fact ... that an anomaly exists, but it is not for this appeal bench ... to take that into account in determining whether or not Commissioner Watling erred in the decision that he made." Mr Vines did not disagree with this advice. We strongly recommend that the parties apply their minds and resources to resolving the issue.
F D Westwood Appearances: Date and Place of Hearing: 1 T1429 of 1988: In the Matter of an Appeal by the Tasmanian Confederation of Industries against a Decision of Commissioner Watling in matter T1117 of 1988 re Sea Based Fin Fish Farm Employees. |