T8081
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TASMANIAN INDUSTRIAL COMMISSION Industrial Relations Act 1984 Albertus Letter and Pioneer Building Products Pty Ltd
Appeal - decision by Commissioner P A Imlach on 29 October 1998 in matter T7897 of 1998 - no time limit for lodging applications made pursuant to s.29(1A)(b) - appeal upheld - order revoked - application T7897 referred to Deputy President Johnson for hearing and determination REASONS FOR DECISION On 10 August 1998, Mr Albertus Letter made application to the President for a hearing in respect of an industrial dispute lodged pursuant to s.29(1A)(b) of the Industrial Relations Act 1984, concerning the quantum of severance pay paid to him following his dismissal from Pioneer Building Products Pty Ltd when his position was made redundant. The details of his claim for severance pay were set out in his application and read as follows: "I was paid 55 weeks + 4 weeks in lieu of notice plus $8,000.00 compensation for company supplied vehicle which formed part of my salary package - whereas I believe a fair and reasonable redundancy should have been 3 weeks for each year of service (37 x 3 = 111 weeks) plus 4 weeks in lieu of notice plus $8,000.00 compensation for motor vehicle." The matter was referred to Commissioner Imlach, who determined in his Reasons for Decision1 that the application was lodged outside the 14 day limit prescribed in s.29(1B) of the Act and, after applying the general principles enunciated by Wilcox J in Hunter Valley Developments Pty Ltd v Cohen (1984) 3 FCR 344, he decided not to grant an extension of time. Commissioner Imlach went on to say in his decision that "whilst I accept the submission that the merit of Mr Letter's case was not canvassed fully, nonetheless, there was a not insignificant redundancy package accepted by Mr Letter, albeit reluctantly. In these circumstances I am persuaded the substantial merit of the application was not sufficient for me to grant the extension of time." It was against this decision that Mr Letter (the appellant) on 18 November 1998, lodged a Notice of Appeal pursuant to s.70(1) of the Act, which contained the following grounds:
Mr R Pearce of Douglas and Collins, Barristers and Solicitors, who appeared by leave of the Commission on behalf of the appellant, and Mr D Dilger of the Tasmanian Chamber of Commerce and Industry Limited, who appeared on behalf of Pioneer Building Products Pty Ltd (the respondent) were requested to address Ground 1 of the appeal, in the first instance. Appellant's Submission Mr Pearce submitted that the hearing before the Commissioner was conducted on the basis that it was a claim for an increase in severance pay following a redundancy. He said that s.29(1A) of the Act provides:
and s.29(1B) provides:
Mr Pearce contended that s.29(1B) was not applicable to an application under s.29(1A)(b). He said the time limit imposed by s.29(1B) applies only to applications made under s.29(1A)(a). In support for his contention he submitted that:
Respondent's Submission It was Mr Dilger's opening submission that the appellant had not raised the substance of Appeal Ground 1 at first instance. He said, s.71(8) of the Act states:
Mr Dilger submitted that leave should not be granted to the appellant to raise the subject matter of Appeal Ground 1 as it was not dealt with at first instance and, to do so now would greatly prejudice the respondent. In response, Mr Pearce submitted that it was a matter of law as to whether or not the Commissioner, at first instance, should have made the Order he did. Therefore, he said, no leave was required for the Full Bench to consider this argument and, if leave was required then it should be granted because it would otherwise be a situation where the Full Bench was condoning, on a technicality, a clear error of law in the application of the Act. The Full Court of the Supreme Court of Tasmania, in Attorney-General v. Estcourt and The Wilderness Society (1995) 4TAS R 355 confirmed that an administrative tribunal is empowered to determine issues of law relevant to the proper determination of a matter before it. We considered that Ground 1 of the appeal related to the proper application of the Act and, as such, could not be ignored. Accordingly we proceeded to deal with Ground 1 and indicated to the parties that if leave to raise the matter at appeal was required, it was granted. Mr Dilger contended that the fourteen day limit, imposed by section s.29(1B), was intended to apply to industrial disputes relating to termination of employment and paragraphs (a) and (b) of s.29(1A) related to the termination of employment. He identified as being informative the second reading speech by the Minister for Industrial Relations when introducing the Industrial Relations Amendment Bill 1994 into Parliament. Mr Dilger submitted that the rationale for the enactment of the limitation period was to ensure:
He also took comfort for this proposition from J B Wood v Commonwealth Bank of Australia- IRCA- (WI 1022 of 1996) - wherein Ritter JR stated:
We note that was a decision relating to an application for an extension of time when bringing a late claim for an unlawful termination as opposed to a dispute over the quantum of severance pay, as is the case in the application which is the subject of this appeal. Mr Dilger contended that, if the 14-day limit did not apply to s.29(1A)(b) applications, the employer would not be able to make budgetary decisions and get on with their business as the Act intended. In addition, he said:
Mr Dilger directed the attention of the Bench to s.29(1A) which states:
He submitted that the legislation is quite explicit, in that paragraphs (a) and (b) of s.29(1A) deal with termination of employment and therefore have direct application to s.29(1B). Mr Dilger also called in aid the definitions of "industrial dispute" and "industrial matter" as defined by s.3 of the Act. They state: "industrial dispute" means a dispute in relation to an industrial matter - (a) that has arisen; or (b) that is likely to arise or is threatened or impending; "industrial matter" means any matter pertaining to the relations of employers and employees and, without limiting the generality of the foregoing, includes - (a) a matter relating to - (i) the mode, terms and conditions of employment; or (ii) the termination of employment of an employee or former employee; or (iii) the reinstatement of an employee or a former employee who has been unfairly dismissed; or (iv) the payment of compensation to an employee or a former employee if the Commission determines reinstatement is impractical; or (v) severance pay for an employee or a former employee whose employment is to be, or has been, terminated as a result of redundancy; or (b) a breach of an award or a registered agreement - ..." Mr Dilger contended that paragraphs (a)(ii), (iii), (iv), and (v) of the definition of "industrial matter" were all matters relating to the termination of employment or in the circumstances of (iii); (iv); and (v) were triggered by a termination of employment. From this he concluded that, as the original application was dealt with via s.29(1A)(b), it was an "industrial matter" within the meaning of the Act relating to the termination of employment. Mr Dilger further submitted that s.29(1B) stipulates:
He maintained that a dispute over the quantum of severance pay could only arise after a termination had taken place and as such it was "an industrial dispute relating to termination of employment." Mr Dilger said the word "relate" must be given its ordinary meaning, that is, "to be connected with". Therefore, he said, the 14-day time limit required under s.29(1B) must apply to applications lodged pursuant to s.29(1A)(b) of the Act. In addition, Mr Dilger submitted that s.31(1A) requires that:
He said that Article 4 of that ILO Convention requires consideration of two aspects of termination:
The thrust of Mr Dilger's submission, in relation to this aspect of his case, was that, when the applicant in the original hearing (T7897 of 1998) sought a severance payment, he did so as a result of a termination "based on the operational requirements of the undertaking, establishment or service." (Article 4, ILO Convention) Therefore, the original claim related to the termination of employment and s.29(1B) of the Act was applicable. Remedy Section 71(13) of the Act states:
(a) confirm, revoke or vary the award or decision appealed against; (b) make an award or decision dealing with the subject-matter of the award or decision appealed against; (c) direct the Commissioner who made the award or the Commissioner or Registrar whose decision is appealed against, or another Commissioner, to take further action to deal with the subject-matter of the award or decision in accordance with the directions of the Full Bench. Mr Pearce submitted that the Full Bench should revoke the decision of Commissioner Imlach and determine the application itself, on the evidence that was before the Commissioner. However, his secondary submission was that the original decision be revoked and the matter be remitted to another member of the Commission for determination. Mr Pearce said it was inappropriate for the same Commissioner to re-hear the application because to do so would give rise to a perception of bias; especially given the fact that when dismissing the application, Commissioner Imlach made comments about its merit. Mr Dilger submitted that we should not determine this matter without hearing the evidence on oath at first hand. He was of the view that the application should be referred back to Commissioner Imlach or another member of the Commission. Finding Section 29(1A) prescribes the types of industrial disputes in respect of which a former employee may make application to the President for a hearing. They are: "(a) the termination of employment of the former employee; or (b) severance pay in respect of employment of the former employee terminated as a result of redundancy; or (c) a breach of an award or a registered agreement involving the former employee." All of the above mentioned issues are industrial matters within the meaning of s.3 of the Act. Section 29(1B) provides: "An application for a hearing before a Commissioner in respect of an industrial dispute relating to termination of employment is to be made within 14 days of the day of termination or within any further period the Commissioner considers appropriate in the circumstances." Having before it an application pursuant to s.29(1A), the Commission must determine whether or not s.29(1B) is applicable. In our view s.29(1B) clearly applies to applications made pursuant to s.29(1A)(a). There are no clear words to that effect in respect of applications pursuant to s.29(1A)(b) and it is reasonably clear that applications made under s.29(1A)(c) are not envisaged as being caught by s.29(1B). The question, which is the overall thrust of this appeal, is whether an application made pursuant to s.29(1A)(b) of the Act is "an industrial dispute relating to the termination of employment" for the purposes of s.29(1B). The provisions of s.29(1B) are prima facie ambiguous so we consider that it would be legitimate to refer to the Hansard record of debate upon the provision prior to its enactment, which was by s.14 of Act No. 18 of 1997. Prior to that time, subsection (1A) allowed an application by a former employee in relation only to the termination of the employment of that employee. In other words, the right to apply in respect of severance pay and breach of an award first appeared in the 1997 amendment. The 1997 amendment also modified the provisions of s.29(1B), by allowing a Commissioner to extend time for the making of an application under subsection (1). However, although the same amending provision added to subsection (1A) new grounds for an application, it did not in terms subject those grounds to the provisions of subsection (1B). That, we consider, is an inexplicable omission if it was the intention of the legislature that time limits should apply to the new grounds. We have reviewed the Hansard record of the debate both in the Lower and in the Upper House, but they were unhelpful because there was simply no discussion of clause 14 of the Bill. Reverting therefore to the context in which s.29(1B) appears, the phraseology "in respect of an industrial dispute relating to termination" is identical to that used in paragraph (a) of subsection (1A). Given that the other paragraphs of that subsection were subsequently added, and yet the scope of subsection (1B) was not extended, our prima facie position is that the subsection should not be read as applying to the additional grounds added to subsection (1A) in 1997. The addition of those grounds should be seen as having some purpose - viz. to add something to that which is already there. Having accepted that, it follows that Parliament saw that a dispute relating to severance pay in respect of employment which has been terminated as a result of redundancy was something different from termination of employment, otherwise there would have been no need to add paragraph (b). Finally, we consider there is a legitimate basis for placing a time limit on applications under paragraph (a) but not on those under paragraph (b). An application under paragraph (a) could lead to an order that a terminated employee be reinstated. Because of the impact that might have upon an employer's staffing arrangements, it is reasonable that such an application should be made promptly. On the other hand, there is no prima facie reason why an issue relating to severance pay has to be dealt with quickly, because any delay in pursuing an application is more likely to impact adversely upon the applicant than upon the respondent employer. We consider that Mr Dilger's reliance on earlier decisions of this jurisdiction are of no relevance to this particular matter as each of the applications that gave rise to those decisions was a dispute about the unfairness of a termination of employment. It is also inappropriate, we consider, to rely on the ILO Convention for support. That is because s.31(1A) requires the Commission to take the Convention into account only before it decides whether or not to make an order arising out of a s.29 application in respect of an industrial dispute relating to termination of employment. In that respect it is perhaps timely to point out that Article 4 of the Convention deals only with the need for there to be a valid reason to justify a termination. Article 4 is not relevant to the current circumstances in which the validity of the termination is not in question. The sole issue of concern in this case is the adequacy of the redundancy payment made to Mr Letter. The question of severance pay, which we consider may include a component for redundancy, is dealt with by s.31(1C) and Article 12 of the Convention. There is no direction in that subsection for the Commission to have regard to the Convention, but it is convenient in that context for the Commission to consider factors contained in Article 12 such as the dismissed employee's length of service and level of wages when determining a severance allowance or other separation benefits. From our consideration of the construction of s.29(1A), we conclude that the three paragraphs contained therein "stand alone". We consider it is open to a former employee to make application in respect of one or any combination of the three matters. However, where there exists a dispute relating to the validity of the termination of employment itself [whether it be about the capacity or conduct of the employee, or in respect of a redundancy resulting from the operational requirements of the business] then the application must be made within 14 days of the date of termination in accordance with s.29(1B). The original application being the subject of this appeal was made under s.29(1A)(b). There was no suggestion that a dispute existed relating to the termination of employment itself, and there was no challenge as to the reason for the termination. The dispute was solely about the quantum of severance pay and, as such, we conclude that the application was not subject to the time limit imposed by s.29(1B) of the Act. For all the above reasons, we are of the opinion that Commissioner Imlach should not have dismissed the application by Mr Letter on the ground that the application was out of time and accordingly we uphold Appeal Ground 1 and revoke the order of the Commissioner arising out of his decision in T7897 of 1998. Having considered the submissions of the parties in respect of remedy, we conclude that it would be inappropriate for this Full Bench to determine the final outcome of application T.7897 of 1998. Therefore, pursuant to s.71(13) of the Act, the matter will be referred to Deputy President Johnson to hear and determine in due course.
F D Westwood Appearances: Date and Place of Hearing: 1 T7897 of 1998 |