FEDERAL COURT OF AUSTRALIA
Construction, Forestry, Mining and Energy Union v Glendell Mining Pty Limited [2017] FCAFC 35
ORDERS
CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION Appellant | ||
AND: | GLENDELL MINING PTY LIMITED ACN 128 511 311 Respondent | |
DATE OF ORDER: |
THE COURT ORDERS THAT:
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
SIOPIS J:
1 Mr Brendan Noyes is and was, at all material times, an employee of the respondent, Glendell Mining Pty Limited. At different times during the period 26 January 2010 to 27 January 2014, Mr Noyes went on paid annual leave. There were six occasions, during that period, when a public holiday fell on a day when Mr Noyes was on a period of paid annual leave. The respondent deducted each of those public holidays from Mr Noyes’ accrued annual leave entitlement. There was also an occasion, during the period, when Mr Noyes was on personal/carer’s leave on a public holiday, and the respondent treated Mr Noyes as being on paid annual leave on that day, and deducted a day from Mr Noyes’ accrued entitlement to paid annual leave.
2 During the period in question, Mr Noyes’ employment conditions were regulated by, initially, an award and, subsequently, two enterprise agreements.
3 Mr Noyes is, and was, at all material times, a member of the Construction, Forestry, Mining and Energy Union (the CFMEU). The CFMEU commenced a proceeding in the Federal Circuit Court of Australia in which it sought a declaration that, contrary to s 44 of the Fair Work Act 2009 (Cth) (the FW Act), the respondent had contravened a provision of the National Employment Standards (NES), being s 89 of the FW Act, by taking Mr Noyes to be on paid annual leave on each of the public holidays in question. The Federal Circuit Court dismissed the application brought by the CFMEU. The appellant sought other declarations which were also dismissed. The CFMEU now appeals to this Court.
4 The appellant advanced two arguments – a primary argument and an alternative argument.
5 I have had the advantage of having read the reasons for decision of White and Bromwich JJ. I agree with White and Bromwich JJ that the alternative argument advanced by the appellant should be dismissed. However, I have the misfortune to have come to a different view to White and Bromwich JJ in relation to the primary argument. I set out my reasons below.
STATUTORY BACKGROUND
6 It is necessary to set out some of the statutory background.
7 Section 44(1) of the FW Act provides as follows:
44(1) An employer must not contravene a provision of the National Employment Standards.
8 Section 12 of the FW Act defines a large number of words and terms used in the FW Act. The term, “National Employment Standards”, is one such term. For the meaning of that term, s 12 directs the reader to s 61(3) of the FW Act.
9 Section 61 of the FW Act provides as follows:
61(1) This Part sets minimum standards that apply to the employment of employees which cannot be displaced, even if an enterprise agreement includes terms of the kind referred to in subsection 55(5).
61(2) The minimum standards relate to the following matters:
…
(d) annual leave (Division 6);
(e) personal/carer’s leave and compassionate leave (Division 7);
…
(h) public holidays (Division 10);
…
61(3) Divisions 3 to 12 constitute the National Employment Standards.
(Original emphasis.)
10 Section 89(1) of the FW Act is a provision of the National Employment Standards and so falls within the ambit of s 44 of the FW Act. No one contended otherwise.
11 Section 89(1) appears in Div 6 of Ch 2 of Pt 2-2 and states:
Public holidays
89(1) If the period during which an employee takes paid annual leave includes a day or part-day that is a public holiday in the place where the employee is based for work purposes, the employee is taken not to be on paid annual leave on that public holiday.
12 Section 87(1) of the FW Act reads as follows:
Amount of leave
87(1) For each year of service with his or her employer, an employee is entitled to:
(a) 4 weeks of paid annual leave; or
(b) 5 weeks of paid annual leave, if:
(i) a modern award applies to the employee and defines or describes the employee as a shiftworker for the purposes of the National Employment Standards; or
(ii) an enterprise agreement applies to the employee and defines or describes the employee as a shiftworker for the purposes of the National Employment Standards; or
(iii) the employee qualifies for the shiftworker annual leave entitlement under subsection (3) (this relates to award/agreement free employees).
13 It was common cause that during the period in question, Mr Noyes was entitled to be paid annual leave of five weeks, and later six weeks, pursuant to the award and enterprise agreements regulating his employment conditions; and that those periods of paid annual leave were, respectively, in excess of the minimum period set out in s 87(1)(a).
14 The respondent accepted that it had deducted from Mr Noyes’ annual leave entitlement, the public holidays on which Mr Noyes was away from work, but contended that s 89(1) had no application to the impugned deductions it had made.
15 The respondent contended that in circumstances where an employee was, pursuant to an award or enterprise agreement, entitled to a period of paid annual leave which exceeded the minimum periods set out in s 87(1), the statutory regime comprising the National Employment Standards applied only in relation to that minimum period of paid annual leave referred to in s 87(1), but had “nothing to say” in relation to that portion of paid annual leave which exceeded the minimum periods. The respondent referred to the minimum period of paid annual leave designated in s 87(1) as the “NES period”, and the period in excess of that period, as the “non-NES period”.
16 There were two major limbs to the respondent’s argument.
17 The first limb was that the term “paid annual leave” as used in s 89(1), and other sections in the FW Act, was not to be given its ordinary meaning, but a limited and specific meaning which was prescribed by the definition of “paid annual leave” in s 12 of the FW Act.
18 The respondent observed that the term “paid annual leave” was defined in s 12 of the FW Act:
[P]aid annual leave means paid annual leave to which a national system employee is entitled under section 87. (Original emphasis.)
19 The respondent contended that the reference to s 87 in the definition was a reference only to the paid annual leave for the minimum periods set out in s 87(1)(a) and (b), and, therefore, the term “paid annual leave”, when used in s 89 of the FW Act and other sections of the FW Act, was to be construed as referring only to paid annual leave for the minimum prescribed periods referred to in s 87(1)(a) and (b).
20 The consequence was, contended the respondent, that the provisions of s 89 applied only to four weeks of the total five or six week periods of Mr Noyes’ paid annual leave provided for in the respective award and enterprise agreements, but not to the additional one week or two weeks of that total period of paid annual leave provided for therein.
21 Accordingly, said the respondent, the appellant should fail because it had not demonstrated that the deductions from Mr Noyes’ annual leave entitlement were not made in respect of public holidays which fell within the additional “non-NES” week or two weeks of Mr Noyes’ annual leave respectively.
22 The second limb of the respondent’s argument is founded on s 55 of the FW Act and, in particular, a note to s 55(6).
23 Section 55 of the FW Act deals with the interaction between the NES and a modern award or enterprise agreement. Section 55(1) prohibits a modern award or enterprise agreement from excluding the NES or any provision of the NES.
24 Subsections 55(4), (5) and (6) provide as follows:
Ancillary and supplementary terms may be included
…
55(4) A modern award or enterprise agreement may also include the following kinds of terms:
(a) terms that are ancillary or incidental to the operation of an entitlement of an employee under the National Employment Standards;
(b) terms that supplement the National Employment Standards;
but only to the extent that the effect of those terms is not detrimental to an employee in any respect, when compared to the National Employment Standards.
Note 1: Ancillary or incidental terms permitted by paragraph (a) include (for example) terms:
(a) under which, instead of taking paid annual leave at the rate of pay required by section 90, an employee may take twice as much leave at half that rate of pay; or
(b) that specify when payment under section 90 for paid annual leave must be made.
Note 2: Supplementary terms permitted by paragraph (b) include (for example) terms:
(a) that increase the amount of paid annual leave to which an employee is entitled beyond the number of weeks that applies under section 87; or
(b) that provide for an employee to be paid for taking a period of paid annual leave or paid/personal carer’s [sic] leave at a rate of pay that is higher than the employee’s base rate of pay (which is the rate required by sections 90 and 99).
Note 3: Terms that would not be permitted by paragraph (a) or (b) include (for example) terms requiring an employee to give more notice of the taking of unpaid parental leave than is required by section 74.
Enterprise agreements may include terms that have the same effect as provisions of the National Employment Standards
55(5) An enterprise agreement may include terms that have the same (or substantially the same) effect as provisions of the National Employment Standards, whether or not ancillary or supplementary terms are included as referred to in subsection (4).
Effect of terms that give an employee the same entitlement as under the National Employment Standards
55(6) To avoid doubt, if a modern award includes terms permitted by subsection (4), or an enterprise agreement includes terms permitted by subsection (4) or (5), then, to the extent that the terms give an employee an entitlement (the award or agreement entitlement) that is the same as an entitlement (the NES entitlement) of the employee under the National Employment Standards:
(a) those terms operate in parallel with the employee’s NES entitlement, but not so as to give the employee a double benefit; and
(b) the provisions of the National Employment Standards relating to the NES entitlement apply, as a minimum standard, to the award or agreement entitlement. (Original emphasis.)
Note: For example, if the award or agreement entitlement is to 6 weeks of paid annual leave per year, the provisions of the National Employment Standards relating to the accrual and taking of paid annual leave will apply, as a minimum standard, to 4 weeks of that leave. (Emphasis added.)
25 The respondent contended that the note to s 55(6) of the FW Act supported the construction of the FW Act for which it contended because it recognised that the NES only applied to the minimum periods of paid annual leave referred to in s 87(1) of the FW Act.
26 The respondent went on to contend that, on its proper construction, the FW Act contemplated that for affected employees there would be a two-tiered system of paid annual leave. Pursuant to that two-tiered structure, a four week tranche of the leave would be NES protected paid annual leave; and the supplementary tranche of paid annual leave in excess of the minimum s 87(1) periods, would be unprotected by s 89 of the FW Act, and the other NES provisions in the FW Act.
27 I am, for the following reasons, not able to accept the construction of s 89(1) of the FW Act contended for by the respondent.
28 First, the respondent’s construction of the term “paid annual leave”, would introduce an element of complexity in relation to the taking and recording of paid annual leave for affected employers and employees, which would not arise if the term “paid annual leave” was given its ordinary meaning.
29 The complexity arises from the attribution of different entitlements depending upon whether the leave applied for, and taken, is characterised as falling within the “NES protected” tranche or the “non-NES protected” tranche of paid annual leave. This differentiation in entitlement would be of major practical significance to all affected employees and their employers. This is because one would expect that, because of the degraded protection attendant upon the non-NES protected tranche of paid annual leave, employees intending to take a period of paid annual leave which included a public holiday, would normally seek to ensure that he or she nominated that period of leave as being within the classification of NES protected leave, and would then take non-NES protected leave during a period which did not include a public holiday.
30 The construction contended for by the respondent would, therefore, introduce the complication that an affected employee, when applying for paid annual leave, would need to advise the employer whether the period of paid annual leave he or she intended to take fell within his or her “NES protected” tranche of leave or the “non-NES protected” tranche of leave. Further, affected employers would need to inform their employees of the two-tiered structure for the taking of paid annual leave, and provide a facility for the affected employee applying for leave to nominate whether the proposed leave was to be deducted from the “NES protected” tranche or the “non-NES protected” tranche.
31 Further, of course, the affected employers would be required to keep records which differentiated between the classification of the annual leave taken for each employee.
32 In my view, Parliament did not, in enacting what it considered to be beneficial employment legislation, intend to introduce this level of complexity into the basic employment practice of applying for, and taking, paid annual leave.
33 In my view, the unsatisfactory practical consequences for affected employers and their employees which flows from the construction contended for by the respondent, militates against the acceptance of that construction.
34 I observe, in passing, that the terms in the enterprise agreements covering Mr Noyes’ employment do not refer to the two-tiered structure of paid annual leave entitlement for which the respondent contends.
35 Further, in my view, the note to s 55(6) provides only limited support for the respondent’s contention that the words “paid annual leave” in s 89 of the FW Act, are to be given the confined meaning for which the respondent contended.
36 First, s 40A(1) of the FW Act provides, in effect, that the notes are not to form part of the FW Act.
37 Secondly, the note to s 55(6) is itself equivocal in relation to the question of whether the term “paid annual leave” is to be construed as a term of art, being confined only to that tranche of paid annual leave comprising the minimum period prescribed by s 87(1). It is apparent that the note to s 55(6) does not use the term “paid annual leave” as a term of art, because it contemplates that that term can also be applied to a period of annual leave provided for in an award or enterprise agreement that is in excess of the minimum periods set out in s 87(1). Thus, the note states that:
[I]f the award or agreement entitlement is to 6 weeks of paid annual leave per year, the provisions of the National Employment Standards relating to the accrual and taking of paid annual leave will apply, as a minimum standard, to 4 weeks of that leave. (Emphasis added.)
38 Further, there is also a reference in another note, namely, note 2 to s 55(4), which uses the term “paid annual leave” to describe a period of paid annual leave given in an award or enterprise agreement in excess of the minimum periods referred to in s 87(1) of the FW Act.
39 Thus, note 2 to s 55(4) provides:
Supplementary terms permitted by paragraph (b) include (for example) terms:
(a) that increase the amount of paid annual leave to which an employee is entitled beyond the number of weeks that applies under section 87;…
40 In my view, the proper construction of s 89 of the FW Act is not to be derived by giving the definition of “paid annual leave” in s 12 of the FW Act, the meaning contended for by the respondent, and then applying it to s 89. In this regard, the following observations of McHugh J in Kelly v The Queen (2004) 218 CLR 216 at [103] are germane:
[T]he function of a definition is not to enact substantive law. It is to provide aid in construing the statute. Nothing is more likely to defeat the intention of the legislature than to give a definition a narrow, literal meaning and then use that meaning to negate the evident policy or purpose of a substantive enactment.
41 I agree with the Full Court in Centennial Northern Mining Services Pty Ltd v Construction, Forestry, Mining and Energy Union (2015) 231 FCR 298 at [8] which described the definition of “paid annual leave” in the FW Act as not being particularly helpful.
42 Rather, in my view, the proper construction of s 89 is to be derived from considering the section in the context of the FW Act as a whole.
43 It is well accepted that in in construing a provision of an Act the provision must be viewed in the context of the whole of the Act. In the case of Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at [69], McHugh, Gummow, Kirby and Hayne JJ observed:
The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute. The meaning of the provision must be determined “by reference to the language of the instrument viewed as a whole”. In Commissioner for Railways (NSW) v Agalianos, Dixon CJ pointed out that “the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed”. Thus, the process of construction must always begin by examining the context of the provision that is being construed. (Footnotes omitted.)
44 In construing s 89(1) in the context of the FW Act as a whole, it is, in my view, necessary to have regard to other sections of the FW Act. These include ss 88, 98 and 114(1).
45 Section 88 provides:
88(1) Paid annual leave may be taken for a period agreed between an employee and his or her employer.
88(2) The employer must not unreasonably refuse to agree to a request by the employee to take paid annual leave.
46 Section 98 provides:
If the period during which an employee takes paid personal/carer’s leave includes a day or part-day that is a public holiday in the place where the employee is based for work purposes, the employee is taken not to be on paid personal/carer’s leave on that public holiday.
47 Section 114 provides:
Employee entitled to be absent on public holiday
114(1) An employee is entitled to be absent from his or her employment on a day or part-day that is a public holiday in the place where the employee is based for work purposes.
Reasonable requests to work on public holidays
114(2) However, an employer may request an employee to work on a public holiday if the request is reasonable.
114(3) If an employer requests an employee to work on a public holiday, the employee may refuse the request if:
(a) the request is not reasonable; or
(b) the refusal is reasonable.
114(4) In determining whether a request, or a refusal of a request, to work on a public holiday is reasonable, the following must be taken into account:
(a) the nature of the employer’s workplace or enterprise (including its operational requirements), and the nature of the work performed by the employee;
(b) the employee’s personal circumstances, including family responsibilities;
(c) whether the employee could reasonably expect that the employer might request work on the public holiday;
(d) whether the employee is entitled to receive overtime payments, penalty rates or other compensation for, or a level of remuneration that reflects an expectation of, work on the public holiday;
(e) the type of employment of the employee (for example, whether full-time, part-time, casual or shiftwork);
(f) the amount of notice in advance of the public holiday given by the employer when making the request;
(g) in relation to the refusal of a request—the amount of notice in advance of the public holiday given by the employee when refusing the request;
(h) any other relevant matter.
48 Further, s 115 identifies specific days as comprising “public holidays”, and s 116 of the FW Act goes on to provide that if an employee is absent from work on a public holiday, the employer must pay the employee the employee’s base rate of pay for the employee’s ordinary hours.
49 In outline, therefore, the FW Act contemplates that paid annual leave will be taken at a time agreed between the employer and the employee; and that an employee will be entitled to be absent from work on a public holiday, unless he or she has agreed to work on that public holiday.
50 In construing s 89 of the FW Act, s 114(1) of the FW Act is, in my view, of particular importance.
51 The FW Act clearly contemplates by s 114(1) and s 116 that an employee is to have an entitlement to paid public holiday leave; and further, that the entitlement is to be independent of, and additional to, an entitlement to paid annual leave, or any other entitlement (such as personal/carer’s leave) to be paid whilst being absent from work.
52 Further, as mentioned, the entitlement to paid public holiday leave entitlement is date specific.
53 Thus, if an employer were to treat an employee who is absent from work on a public holiday because he or she is exercising his or her entitlement under s 114(1), as being absent from work for some other reason, for example, by being on paid annual leave, or paid personal/carer’s leave, that action would be a derogation from the independent standing of the s 114(1) entitlement. Accordingly, such conduct by an employer would constitute an infringement of an NES.
54 It is important to note that the language of s 89(1) is prescriptive in that it prescribes how date specific absences from work, namely, public holidays, are to be treated by an employer. In my view, the legislative intent of s 89(1) is to confirm and entrench the separate and independent standing of the entitlement to paid public holiday leave; and, thereby, to ensure that the separate and independent standing of that benefit is not otherwise diminished or undermined by being merged with other entitlements to a paid absence from the workplace.
55 That same rationale, in my view, explains the presence in the FW Act of s 98 in relation to paid personal/carer’s leave.
56 It would, in my view, be incongruous with the independent and date specific status of the s 114(1) entitlement, if s 89 was to be construed as sanctioning the right of an employer to recharacterise an employee’s absence from work on some, but not other, public holidays, as an absence for some other reason. It would be a very strange result if a section which has been included in the FW Act for the very purpose of entrenching the independent and separate status of the s 114(1) entitlement, could, therefore, be construed as an enactment sanctioning the undermining of that status.
57 Accordingly, in my view, for s 114(1) and s 89(1) to be read in a harmonious manner, the words “paid annual leave” in s 89(1) are not to be construed in the limited manner contended for by the respondent.
58 In my view, on its proper construction, the FW Act contemplates that s 89(1) will apply as a minimum standard in relation to the whole of the period of paid annual leave provided for in the appropriate award or enterprise agreement. Thus, in my view, s 89(1) will continue to apply even in respect of a public holiday falling within any portion of paid annual leave in an award or enterprise agreement which exceeds the minimum prescribed periods referred to in s 87(1) of the FW Act.
59 The same reasoning, in my view, applies to the construction of s 98 of the FW Act.
60 I now turn to the facts of this case.
61 During the period in question, Mr Noyes’ employment conditions were regulated by the Black Coal Mine Industry Award 2010, the Xstrata Glendell Mine Operations Employee Enterprise Agreement 2010 and the 2010 Agreement’s successor, the Glendell Mine Operations Employee Enterprise Agreement 2013.
62 Between January 2010 and October 2010, Mr Noyes worked under a six day roster system with no work roster on Sundays. From October 2010, Mr Noyes worked a seven day continuous roster system. Mr Noyes was required to work in accordance with a roster which included work on some public holidays. Mr Noyes’ overall remuneration was calculated on a basis which included compensation at a triple-time pay scale for work he undertook on those public holidays.
63 During the period 26 January 2010 to 27 January 2014, there were six occasions upon which public holidays fell during the period when Mr Noyes was on paid annual leave. Mr Noyes was originally rostered to work on each of those six public holidays.
64 The respondent contended that it would be an absurd outcome if Mr Noyes could be absent from a shift he would have otherwise have worked on each of those public holidays, be paid his full pay (which was calculated on the basis he would work on some public holidays) and also have no diminution of his annual leave entitlements.
65 The FW Act also contemplates an employee will only be away from work on paid annual leave at a time that he or she has agreed with the employer. Further, the evidence of Mr Noyes and Ms Frew was that the respondent operated such a system, namely, a system whereby an employee was required to apply to go on paid annual leave during a nominated period, and for the employer to approve or reject the employee’s application to be away from work on paid annual leave during that period. There is no suggestion in this case that the respondent had not approved Mr Noyes’ application to be on annual leave during any of the periods in which the six contentious public holidays fell.
66 In other words, the position appears to be that rosters were issued which rostered Mr Noyes to be working on each of the contentious public holidays. Mr Noyes applied for annual leave for a period which included the contentious public holiday and the respondent approved Mr Noyes’ application to be away from work on paid annual leave for the period which included the public holiday. The effect of the respondent’s approval was to release Mr Noyes from his agreement to work on the public holiday for which he had initially been rostered to work. This circumstance undermines the respondent’s “absurdity” argument, as it was in the respondent’s control whether or not to approve Mr Noyes’ application for paid annual leave for the period in question.
67 In my view, on the basis of those facts and the construction of s 89 of the FW Act to which I have referred above, s 89 took effect according to its terms, such that Mr Noyes’ entitlement to be away from work under s 114(1) was not merged into an entitlement to be away from work on paid annual leave. As mentioned, s 114(1) provides for a date specific entitlement. It was not open to the respondent to recharacterise Mr Noyes’ absence on each specific public holiday as being an absence on paid annual leave, when s 89 mandated otherwise.
68 The same reasoning applies in relation to the day when Mr Noyes was away on a public holiday during the period when he was on paid personal/carer’s leave.
69 I would, therefore, allow the appeal.
I certify that the preceding sixty-nine (69) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Siopis. |
Associate:
REASONS FOR JUDGMENT
WHITE AND BROMWICH JJ:
70 Section 89 of the Fair Work Act 2009 (Cth) (the FW Act), which is one of the provisions in the National Employment Standards (NES) in Pt 2-2 of the FW Act, has the effect that, when a public holiday occurs during the period in which an employee is on “paid annual leave”, the employee is to be taken not to have been on annual leave on that day. Section 98 of the FW Act has a similar effect with respect to personal/carer’s leave.
71 The principal issue on this appeal concerns the application of ss 89 and 98 when an employee’s entitlements to annual leave and personal/carer’s leave under an enterprise agreement are greater than the entitlements to those forms of leave contained in the NES. In particular, the appeal involves consideration of whether ss 89 and 98 apply to the whole of an employee’s entitlements to annual leave and personal/carer’s leave or only to the extent that these entitlements do not exceed the NES minima. There are other issues which will be identified in the course of these reasons.
Background
72 Mr Brendan Noyes has been employed by the respondent (Glendell) since 2008 as an operator at the Glendell Mine near Ravensworth in New South Wales. He works shift work.
73 It was common ground that Mr Noyes’ employment has been governed by industrial instruments as follows:
(a) in the period from 1 January 2010 until 15 July 2010, by the Black Coal Mining Industry Award 2010 (the Black Coal Award), this being a modern award made under the FW Act;
(b) in the period from 16 July 2010 until 17 November 2013, by the Xstrata Glendell Mine Operations Employee Enterprise Agreement 2010 (the 2010 EA);
(c) in the period from 18 November 2013 until the present time, by the Glendell Mine Operations Employee Enterprise Agreement 2013 (the 2013 EA).
74 A number of other matters were also common ground:
(a) Mr Noyes had been absent from work on paid annual leave on 26 January, 14 June and 26 December 2010, on 3 January 2011, on 1 January 2013 and on 27 January 2014 and that each of these six days was a public holiday as defined in s 115 of the FW Act;
(b) Glendell had treated Mr Noyes as having been on annual leave on each of those public holidays by making a deduction from his accrued annual leave entitlement in respect of his absences from work on those days;
(c) Mr Noyes had been absent from work on personal/carer’s leave on 26 January 2011, which was the Australia Day public holiday;
(d) Glendell had treated Mr Noyes as being on personal/carer’s leave on that day by making a deduction from his accrued personal/carer’s leave balance.
75 The appellant (the CFMEU), of which Mr Noyes is a member, contends that in treating Mr Noyes as having been on annual leave on the public holidays and on personal/carer’s leave on 26 January 2011, Glendell contravened s 44 of the FW Act (which proscribes contraventions of the NES) and, in the case of the public holiday on 27 January 2014, had contravened s 50 of the FW Act (which proscribes contraventions of terms in an enterprise agreement). The contraventions had occurred, it was said, because ss 89 and 98 of the FW Act required Glendell to treat Mr Noyes as not having been on paid annual leave or personal/carer’s leave on days which were public holidays. Glendell disputed that ss 89 and 98 applied to periods of paid annual leave or personal/carer’s leave which exceeded the NES minima, which it said had been the case in each period of leave taken by Mr Noyes.
76 The CFMEU commenced proceedings in the Federal Circuit Court (the FCC) seeking declarations of the contraventions it alleged, orders for the adjustment of Mr Noyes’ annual leave and personal/carer’s leave entitlements and the imposition of pecuniary penalties.
77 At the trial, the CFMEU abandoned an additional claim it had made in respect of 25 April 2014, the Anzac Day public holiday. It also abandoned the claim of accessorial liability which it had made against the second respondent (Glendell’s Operation Manager) in the proceedings at first instance.
78 The FCC dismissed the CFMEU application: Construction, Forestry, Mining and Energy Union v Glendell Mining Pty Ltd [2015] FCCA 3152. The CFMEU now appeals against that judgment.
Statutory provisions
79 Section 43(1) of the FW Act identifies the main terms and conditions of employment for which the FW Act provides as being those set out in the NES and those contained (relevantly) in a modern award or in an enterprise agreement.
80 The NES are specified to be the minimum standards applicable to the employment of national system employees which cannot be displaced, even if an enterprise agreement includes terms which have the same, or substantially the same, effect (FW Act, ss 55(1), 61(1)). It was common ground that Mr Noyes is a national system employee and Glendell is a national system employer.
81 Division 6 of Pt 2-2 contains the NES relating to the annual leave of national system employees. Section 87 prescribes the entitlement:
87 Entitlement to annual leave
Amount of leave
(1) For each year of service with his or her employer, an employee is entitled to:
(a) 4 weeks of paid annual leave; or
(b) 5 weeks of paid annual leave, if:
(i) a modern award applies to the employee and defines or describes the employee as a shiftworker for the purposes of the National Employment Standards; or
(ii) an enterprise agreement applies to the employee and defines or describes the employee as a shiftworker for the purposes of the National Employment Standards; or
(iii) the employee qualifies for the shiftworker annual leave entitlement under subsection (3) (this relates to award/agreement free employees).
Note: Section 196 affects whether the FWC may approve an enterprise agreement covering an employee, if the employee is covered by a modern award that is in operation and defines or describes the employee as a shiftworker for the purposes of the National Employment Standards.
Accrual of leave
(2) An employee’s entitlement to paid annual leave accrues progressively during a year of service according to the employee’s ordinary hours of work, and accumulates from year to year.
Note: If an employee’s employment ends during what would otherwise have been a year of service, the employee accrues paid annual leave up to when the employment ends.
…
82 As can be seen, the NES entitlement is four weeks of paid annual leave for each year of service unless the employee is a shiftworker to whom subs (1)(b) applies. It was common ground that, while Mr Noyes is a shiftworker, subs (1)(b) did not apply in his case. Section 87(2) has the effect that Mr Noyes’ entitlement to annual leave accrued progressively during each year of service according to his ordinary hours of work, and accumulated from year to year.
83 Section 88 concerns the time at which the paid annual leave for which s 87 provides may be taken. An employer must not refuse unreasonably to agree to an employee’s request to take paid annual leave (subs (2)), and the leave may be taken for a period agreed between the employer and the employee (subs (1)).
84 Section 89 provides for the inter-relationship between paid annual leave and public holidays:
89 Employee not taken to be on paid annual leave at certain times
Public holidays
(1) If the period during which an employee takes paid annual leave includes a day or part-day that is a public holiday in the place where the employee is based for work purposes, the employee is taken not to be on paid annual leave on that public holiday.
Other periods of leave
(2) If the period during which an employee takes paid annual leave includes a period of any other leave (other than unpaid parental leave) under this Part, or a period of absence from employment under Division 8 (which deals with community service leave), the employee is taken not to be on paid annual leave for the period of that other leave or absence.
85 The effect of s 89(1) is that an employee is taken not to have been on paid annual leave on a public holiday occurring during his or her period of paid annual leave.
86 Other provisions in Div 6 contain prescriptions concerning the taking of annual leave and the payment for it.
87 Division 7 of Pt 2-2, which concerns personal/carer’s leave and compassionate leave, contains provisions corresponding with those in Div 6. Employees have an entitlement to 10 days of personal/carer’s leave for each year of service (s 96(1)), the entitlement accrues progressively during a year of service according to the employee’s ordinary hours of work, and the entitlement accrues from year to year (s 96(2)). Employees may take personal/carer’s leave when they are unfit for work by reason of illness or injury or to provide care or support to an immediate family or household member who is ill or injured or the subject of an unexpected emergency (s 97).
88 Section 98 is in terms which are relevantly identical to those of s 89(1):
98 Employee taken not to be on paid personal/carer’s leave on public holiday
If the period during which an employee takes paid personal/carer’s leave includes a day or part-day that is a public holiday in the place where the employee is based for work purposes, the employee is taken not to be on paid personal/carer’s leave on that public holiday.
Mr Noyes’ entitlements to annual leave
89 It is convenient to consider first the CFMEU appeal with respect to Mr Noyes’ annual leave entitlements.
90 The provisions in the 2010 EA and the 2013 EA (jointly, the EAs) concerning annual leave are, in the respects which are material to this appeal, identical so that it is not necessary to distinguish between them.
91 By cl 21 in both EAs, shiftworkers on a “six day roster” are entitled to five weeks paid annual leave each year (accruing at the rate of 3.3654 hours per week). Those working a seven day roster are entitled to six weeks of paid annual leave each year (accruing at the rate of 4.0385 hours per week). Under the Black Coal Award, Mr Noyes had had an entitlement to annual leave of five weeks per year.
92 It was common ground at trial that from 2008 until 10 October 2010, Mr Noyes had been a shiftworker on a six day roster and from 11 October 2010 until at least January 2015, on a seven day roster. Accordingly, since 11 October 2010 he had been entitled to six weeks of paid annual leave each year. Obviously enough, Mr Noyes’ entitlements to annual leave since 2008 have been superior to those prescribed in the NES.
The effect of s 89 of the FW Act
93 As already noted, Mr Noyes was absent from work on paid annual leave on the day of each of the public holidays to which the CFMEU appeal relates (other than 26 January 2011 when he was absent on personal/carer’s leave). On a literal reading, s 89 would have the effect that Mr Noyes should have been taken not to have been on paid annual leave on those days. This was the effect for which the CFMEU contends. Glendell, on the other hand, contends that s 89 applies only to leave which is the NES minimum. It had dealt with Mr Noyes’ leave entitlements on that basis.
94 The question is one of statutory construction to be resolved in the familiar way. The provisions in the FW Act must be read as a whole having regard to both text and context, as well as to purpose: Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (Northern Territory) [2009] HCA 41, (2009) 239 CLR 27 at [47]; Centennial Northern Mining Services Pty Ltd v Construction, Forestry, Mining and Energy Union [2015] FCAFC 100, (2015) 231 FCR 298 (Centennial Mining) at [12]-[13], [27] and C v Commonwealth of Australia [2015] FCAFC 113, (2015) 234 FCR 81 at [40].
95 The CFMEU submitted that s 89 refers to “paid annual leave” without making any distinction based on the source of the entitlement. This being so the expression “paid annual leave” should be understood as referring to all paid annual leave.
96 Secondly, the CFMEU submitted that s 89 manifests a clear policy that employees should have the benefit of leave on public holidays in addition to their annual leave or, put another way, that the periods during which an employee is entitled to be absent from work on leave should not be reduced by the coincidence of entitlements occurring on the same day. It then contends that full effect should be given to this policy by construing s 89 so as to apply to all annual leave to which an employee is entitled, irrespective of the source of the entitlement.
97 Thirdly, the CFMEU submitted that s 89 should be understood as having been legislated with regard to the practicalities of the workplace situations in which it will operate and should be construed accordingly. In particular, regard should be had to the practical difficulties for employers and employees in determining whether a particular public holiday occurs on a day of annual leave which is part of the NES minimum or part of the greater entitlement for which an enterprise agreement may provide. Related to this is the reality that, under an enterprise agreement providing for an annual leave entitlement which is superior to the NES, the entitlement to annual leave is a single entitlement, irrespective that part of the entitlement matches the NES entitlement.
98 Fourthly, the CFMEU referred to other provisions in the FW Act which it submitted were examples of the term “paid annual leave” being used to refer to all paid annual leave and not just to the NES minimum.
99 Finally, the CFMEU sought to draw support from the decision of this Court in Centennial Mining, which it submitted was an example of provisions in the NES being held to apply to entitlements in excess of those for which the NES provided.
100 Glendell submitted that, on the proper construction of s 89, the issue of practical difficulty raised by the CFMEU did not arise. There is no need, it submitted, for an employer to identify whether a particular public holiday falls during a period of leave derived from the NES or from the additional period for which an award or enterprise agreement provides. Instead, all that is necessary is that an employer be able to demonstrate that an employee has had at least the minimum NES entitlement of four weeks paid annual leave each year.
101 In our opinion, this particular answer to the CFMEU’s submissions should not be accepted. The terminology of s 89 indicates that it operates with respect to public holidays occurring during the particular period (“the period”) in which the employee takes paid annual leave and with respect to the particular public holiday (“that public holiday”) occurring during the period. The construction proposed by Glendell in this respect does not give effect to these features of s 89.
102 Further, it is reasonable to infer, in our opinion, that s 89 is intended to be capable of application at the time the leave is taken, so that both employers and employees know the position as at that time. This enables each to plan appropriately in relation to employee absences. At the very least, there is no indication in s 89 that it is to operate only in retrospect in the manner for which Glendell contends, that is, as a form of stocktake at the end of a given year.
103 Further still, Glendell’s submission assumes, inappropriately, that the position will be capable of assessment at the end of a year. That view of the matter does not account for the fact that the entitlement to annual leave accrues progressively during a year of service (s 87(2)) and may be taken at any time during a year, subject to the ability of an employer to refuse an employee’s request on a reasonable basis (s 88). Accordingly, s 89 may be important in determining whether an employee has any entitlement to annual leave at any given time.
104 Nevertheless, we consider that the construction of s 89 for which the CFMEU contends should not succeed. That follows from the terms of s 89 itself and from a consideration of the provisions in the FW Act providing for the inter-relationship of the NES with entitlements within awards and enterprise agreements which exceed those standards.
105 Two separate lines of reasoning indicate that the construction proposed by the CFMEU is not appropriate.
106 The first is that the term “paid annual leave” used in s 89 is a defined term in the FW Act. Section 12 defines “paid annual leave” to mean “paid annual leave to which a national system employee is entitled under section 87”. Glendell submitted that, in accordance with ordinary canons of construction, the term should be understood as being used with the same meaning in each of the succeeding provisions in Div 6, including s 89. This is especially so given that Div 6 is concerned with the establishment of minimum entitlements. This made it appropriate to infer that the succeeding provisions in Div 6 are directed to aspects of the same minimum entitlement and, conversely, improbable that it is directed to entitlements arising other than pursuant to Div 6.
107 The incorporation of the s 12 definition into s 89 has the effect that s 89 applies only to the four or five weeks of annual leave, as the case may be, to which an employee is entitled under the NES set out in s 87, and, accordingly, does not have any application to Mr Noyes’ additional entitlement under the EAs.
108 The CFMEU sought to avoid this conclusion by referring to the statement of the Full Court (Tracey, Flick and Katzmann JJ) in Centennial Mining at [8] that the definition of “paid annual leave” is unhelpful. However, on our understanding, their Honours were referring to the assistance which the definition provided in the circumstances being considered in Centennial Mining and were not intending to express a view that the definition was unhelpful generally. The utility of a statutory definition depends on the context and purpose for which it is sought to be used in any given case.
109 In our opinion, the first line of reasoning has force and supports the conclusion reached by the FCC Judge.
110 The second line of reasoning turns on the inter-relationship between provisions in enterprise agreements on the one hand, and provisions in the NES, on the other.
111 Section 55 of the FW Act provides for that inter-relationship. Subsection (1) provides that a modern award or enterprise agreement must not exclude the NES or any provision of the NES. However, s 55(4) permits modern awards and enterprise agreements to include terms which are “ancillary” or “incidental” to the operation of an entitlement of an employee under the NES, and which “supplement” the NES, providing that such terms are not detrimental to an employee. Section 55(5) permits an enterprise agreement to include terms which have the same effect as provisions in the NES. These subsections provide:
Ancillary and supplementary terms may be included
(4) A modern award or enterprise agreement may also include the following kinds of terms:
(a) terms that are ancillary or incidental to the operation of an entitlement of an employee under the National Employment Standards;
(b) terms that supplement the National Employment Standards;
but only to the extent that the effect of those terms is not detrimental to an employee in any respect, when compared to the National Employment Standards.
Note 1: Ancillary or incidental terms permitted by paragraph (a) include (for example) terms:
(a) under which, instead of taking paid annual leave at the rate of pay required by section 90, an employee may take twice as much leave at half that rate of pay; or
(b) that specify when payment under section 90 for paid annual leave must be made.
Note 2: Supplementary terms permitted by paragraph (b) include (for example) terms:
(a) that increase the amount of paid annual leave to which an employee is entitled beyond the number of weeks that applies under section 87; or
(b) that provide for an employee to be paid for taking a period of paid annual leave or paid/personal carer’s leave at a rate of pay that is higher than the employee’s base rate of pay (which is the rate required by sections 90 and 99).
Note 3: Terms that would not be permitted by paragraph (a) or (b) include (for example) terms requiring an employee to give more notice of the taking of unpaid parental leave than is required by section 74.
Enterprise agreements may include terms that have the same effect as provisions of the National Employment Standards
(5) An enterprise agreement may include terms that have the same (or substantially the same) effect as provisions of the National Employment Standards, whether or not ancillary or supplementary terms are included as referred to in subsection (4).
112 Subsections (6) and (7) of s 55 then provide for the inter-relationship between the NES and terms of the kind permitted by subss (4) and (5):
Effect of terms that give an employee the same entitlement as under the National Employment Standards
(6) To avoid doubt, if a modern award includes terms permitted by subsection (4), or an enterprise agreement includes terms permitted by subsection (4) or (5), then, to the extent that the terms give an employee an entitlement (the award or agreement entitlement) that is the same as an entitlement (the NES entitlement) of the employee under the National Employment Standards:
(a) those terms operate in parallel with the employee’s NES entitlement, but not so as to give the employee a double benefit; and
(b) the provisions of the National Employment Standards relating to the NES entitlement apply, as a minimum standard, to the award or agreement entitlement.
Note: For example, if the award or agreement entitlement is to 6 weeks of paid annual leave per year, the provisions of the National Employment Standards relating to the accrual and taking of paid annual leave will apply, as a minimum standard, to 4 weeks of that leave.
Terms permitted by subsection (4) or (5) do not contravene subsection (1)
(7) To the extent that a term of a modern award or enterprise agreement is permitted by subsection (4) or (5), the term does not contravene subsection (1).
Note: A term of a modern award has no effect to the extent that it contravenes this section (see section 56). An enterprise agreement that includes a term that contravenes this section must not be approved (see section 186) and a term of an enterprise agreement has no effect to the extent that it contravenes this section (see section 56).
113 Glendell contended that the annual leave entitlements in the Black Coal Award and in the EAs bestowing superior annual leave entitlements were terms which “supplemented” the NES and were accordingly permitted by s 55(4)(b). That being so, the terms did not offend s 55(1) and were binding and enforceable.
114 Glendell placed particular emphasis on the terms of s 55(6), submitting that it made plain that an employee’s entitlement to paid annual leave may derive from separate sources, both of which are enforceable under the FW Act. Further, to the extent that the terms in a modern award or enterprise agreement give employees entitlements which are the same as the NES entitlements, those terms operate “in parallel” with the employee’s NES entitlements (but not so as to give the employee a double benefit). The provisions of the NES apply as a minimum standard to the award or agreement entitlements but, again, only to the extent that the award or agreement entitlements are the same as the NES entitlements. By implication, Glendell submitted, the NES entitlements (and in particular s 89) do not extend to entitlements under an award or enterprise agreement which exceed the NES.
115 At first instance, the FCC Judge upheld Glendell’s submissions to this effect. In our opinion, he was correct to do so.
116 The provisions outlined above indicate that the terms and conditions of employment for which the FW Act provides may be those in the NES and (relevantly) supplementary terms in a modern award or in an enterprise agreement. To the extent that the award or enterprise agreement entitlement is the same as the NES entitlement, the two entitlements operate in parallel. The NES standards do apply to the award or enterprise agreement entitlements, but only to the extent to which the entitlements in the latter match those in the former. That follows from the preface in s 55(6) which indicates that the NES apply to terms in the modern award or enterprise agreement “to the extent” that those terms give the employee an entitlement which is “the same as” the NES entitlement.
117 Any doubt as to the effect of s 55(6) in this respect is removed by the note to that subsection. That note indicates that the provisions in the NES “relating to” the accrual “and taking” of paid annual leave apply to the NES minimum period of leave but not to the additional entitlement arising under an award or enterprise agreement.
118 We acknowledge that the note does not form part of the FW Act. This is because s 13(3) of the Acts Interpretation Act 1901 (Cth), as in force as at 25 June 2009 provided that marginal notes, footnotes or endnotes, are not part of an Act. The effect of s 40A of the FW Act is that it is the Acts Interpretation Act in that form which applies in the present case. However, s 15AB of the Acts Interpretation Act allows the Court to have regard to notes as extrinsic material, if the criteria in that section is met: Director of the Fair Work Building Inspectorate v McCullough [2016] FCA 1291 at [125]-[126] (Barker J), that is, “to confirm that the meaning of the provision is the ordinary meaning conveyed by the text of the provision”. See also IMF (Australia) Ltd v Sons of Gwalia Ltd [2005] FCAFC 75, (2005) 143 FCR 274 at [61]; Evans v Minister for Immigration and Multicultural and Indigenous Affairs [2003] FCAFC 276, (2003) 135 FCR 306 at [45] and X v Australian Prudential Regulation Authority [2007] HCA 7, (2007) 226 CLR 630 at [34]-[38], [114]. It is appropriate, therefore, to have regard to the note to s 55(6). This is especially so having regard to the fact that the note formed part of the FW Act when it was enacted by Parliament: The Ombudsman v Moroney (1983) 1 NSWLR 317 at 323-325.
119 Accordingly, s 55(6) has the effect that the NES contained in s 89 is concerned with the entitlements to paid annual leave arising under the NES itself, and not with all entitlements to paid annual leave.
120 This, by itself, suggests that the CFMEU submission based on the purpose of s 89 should not be accepted. Instead, when s 89 is construed in the context of the FW Act as a whole, a more limited purpose is evident, namely, that it is only the entitlement to the NES minimum leave which is not to be reduced on account of a public holiday occurring during the period of the leave.
121 Nor, in our opinion, do the practical difficulties to which the CFMEU adverted indicate that a different construction is appropriate. We agree that difficulties of these kinds are likely to exist unless employers take care to specify in respect of any leave taken by an employee whether it is part of the four week NES minimum or part of the additional leave to which the employee is entitled under a modern award or enterprise agreement. This may mean that employers in particular should maintain appropriate records of the leave taken by employees so as to be able to make this distinction. However, we do not consider that these practical difficulties should control the construction of the FW Act. In particular, they do not warrant this Court concluding that, despite the terms of s 55(6)(b), the provisions of the NES are to apply to the whole of an employee’s entitlement to annual leave and not just to the minimum entitlement prescribed in the NES.
122 The provisions in the FW Act to which the CFMEU pointed as examples of the term “paid annual leave” being used in a way which encompassed leave entitlements other than the NES minimum were ss 126 and 199. We do not regard these provisions as being of assistance. First, it is not readily apparent that those provisions do use the term “paid annual leave” in the way for which the CFMEU contends. Secondly, those provisions are concerned with the leave entitlements of a particular class of employees being school-based apprentices and school-based trainees. Having regard to the particular circumstances of the employment of such employees, it is understandable that there are specific provisions relating to their annual leave entitlements, so that it is inappropriate to draw inferences of a more general kind from the provisions relating to them.
123 Finally, the decision in Centennial Mining does not assist the CFMEU. That decision concerned s 90 of the FW Act which provides for the rate at which annual leave is to be paid: subs (1) is directed to the rate to be paid when leave is taken and subs (2) to the rate at which accrued annual leave is to be paid on the termination of an employee’s entitlement. The Full Court explained the way in which these two provisions are to be read together, saying at [38]:
… Section 90(1) creates the minimum standard: payment at the base rate for ordinary hours worked. The effect of s 90(2) is that if that is the rate at which the employee is paid when he or she takes annual leave, then that is the minimum amount that must be paid for any accrued untaken annual leave. If, on the other hand, there is a modern award or enterprise agreement which provides for payment at a higher rate for annual leave that is taken, then s 90(2) stipulates that that is the rate which is payable where annual leave has accrued but has not been taken. …
124 Thus, the decision in Centennial Mining turned on the language used in the two differently worded subsections in s 90 to address two circumstances. This being so, Centennial Mining is not an example of the one expression being used to address two subsections, let alone authority for the proposition that the NES minima apply generally to entitlements exceeding those minima. Clear words would be necessary for that to be so, and none are apparent in s 89.
125 In summary, we consider that the decision of the FCC Judge in this respect has not been shown to be wrong.
The alternative argument
126 The CFMEU submitted, in the alternative, that even if the construction of ss 89 and 98 of the FW Act for which Glendell contended was correct, Glendell had nevertheless not been entitled to make “all the deductions … from Mr Noyes’ leave balances” which it had. This was so because the paid annual leave taken by Mr Noyes on each occasion had been part of the NES minimum and not part of the additional entitlement for which the EAs provided.
127 The FCC Judge said that he had difficulty understanding this submission but, nevertheless, rejected it. The difficulties which the Judge had are understandable as the argument involves some complexity. It turned in part on the inter-relationship between the entitlement to annual leave (which in both the NES and in the EAs is expressed in weeks) and the taking of annual leave (which cl 21 of the EAs requires to be deducted in ordinary hours).
128 As we understood it, the steps in the CFMEU’s submission are these:
(a) the NES (s 87(1)(a)) states the entitlement of employees to paid annual leave in terms of days of paid annual leave per year (being 20 days);
(b) Mr Noyes’ entitlements to annual leave had accrued as follows:
(i) in respect of his work in the period from 1 January to 15 July 2010, cl 25 of the Black Coal Award had the effect that employees had an annual leave entitlement of 20 days per year;
(ii) in respect of his employment from 16 July 2010 to 11 October 2010, the 2010 EA had the effect that Mr Noyes was entitled to five weeks of annual leave per year, accruing at the rate of 3.3654 hours per week. The CFMEU said that this was equivalent to 175 hours of annual leave and to five weeks leave at 35 hours per week;
(iii) in respect of his employment from 11 October 2010 until 17 November 2013, the 2010 EA had the effect that Mr Noyes was entitled to six weeks annual leave per year, accruing at the rate of 4.0385 hours per week. The CFMEU said that this was equivalent to 210 hours of annual leave and to six weeks leave at 35 hours per week;
(iv) in respect of his employment from 18 November 2013, the 2013 EA had the effect that Mr Noyes was entitled to six weeks annual leave per year accruing at the rate of 4.0385 hours per week. The CFMEU said that this was equivalent to 210 hours of annual leave and to six weeks leave at 35 hours per week;
(c) as to the taking of annual leave, cl 21.1 of the EAs provided that “[a]nnual leave taken will be deducted in ordinary hours”. This required an identification of Mr Noyes’ ordinary hours;
(d) clause 2.10 in each of the EAs defined “ordinary hours” to mean “the hours required to be worked by an employee for the payment of their classification rate”. The term “classification rate” is defined in cl 2.4 to mean “the ordinary hourly rate”. Clause 11 of both EAs provides for the manner in which ordinary hours are to be worked and the rate at which they are to be paid, as follows:
11.1 the ordinary hours of work will be an average of 35 hours per week, averaged over the roster cycle;
11.2 the ordinary hours worked by an employee on the following days will be paid in accordance with the following rates:
Day of week | Rate of Pay |
Mon-Fri | Single time |
Saturday | Double Time |
Sunday | Double time |
(e) the CFMEU submitted next that it was necessary to ascertain how the 35 ordinary hours each week are averaged over the roster cycle. It referred to evidence from a witness for Glendell (Ms Frew) that, before 11 October 2010, Mr Noyes had worked a six day roster in which the “ordinary hours’ component” was 8.75 hours. This meant that in respect of this work, Mr Noyes was entitled to the equivalent of 20 shifts of annual leave representing 8.75 hours per shift. Ms Frew said that on the seven day roster which Mr Noyes had worked since 11 October 2010, the ordinary hours’ component was 10 hours, meaning that Mr Noyes was entitled to 21 shifts of annual leave, representing 10 ordinary hours per shift;
(f) this meant that Mr Noyes’ entitlements to annual leave until 11 October 2010 had been 20 days, that is, no more than the 20 days for which s 87(1)(a) provides, and since 11 October 2010, 21 days, being only one day more than the s 87(1)(a) entitlement;
(g) it followed that there had been only one day in excess of the NES minima which, (if falling on a public holiday) could on Glendell’s construction of s 87(1)(a), be deducted from Mr Noyes’ annual leave, and yet it had made the deduction on four days.
129 In our opinion, this submission breaks down at a number of stages. First, contrary to the CFMEU’s starting proposition, s 87(1)(a) states the employees’ entitlement to paid annual leave in terms of weeks, and not in terms of days per year. The prescription in cl 21.1 that annual leave taken is to be deducted in ordinary hours does not alter the underlying entitlement. This means that the premise upon which the CFMEU submission is based is unsound. It also means that the conclusion summarised in (f) above is unsound. It is inappropriate to infer the extent of the entitlement to annual leave from a particular way in which the annual leave may be taken.
130 Secondly, cl 21 of the EAs expresses the entitlement to annual leave in terms of weeks. They do not express the entitlement in terms of hours or in terms of a number of weeks at a number of hours per week. Clause 25 of the Black Coal Award expressed the entitlement in terms of ordinary hours with the equivalent in weeks (175 hours/five weeks) unless the employee worked a seven day roster or a roster which required an “ordinary shift” to be worked on public holidays, in which case the entitlement included an additional 35 ordinary hours (one week), but the CFMEU analysis did not turn on this. We also observe that the annual leave entitlement under the Black Coal Award was greater than the CFMEU submission supposed (five weeks rather than 20 days, per cl 25.2).
131 Thirdly, the ways in which the ordinary hours of work are performed in a seven day roster of 12 hour shifts are set out in “Indicative Rosters” in Table 3 of the EAs. These show the employees working 14 days out of each 28 days in sequences of two or three consecutive days separated by days off which are also in sequences of two or three consecutive days. The employees work three and four shifts per week in alternating weeks. Accordingly, when employees have a week of paid annual leave to which the NES or the EAs apply, they are relieved from working the three or four shifts in each week, as the case may be, which they would otherwise have worked in that week.
132 Under the NES, the entitlement to four weeks paid annual leave means that employees may have 14 shifts away from work whereas the entitlement to six weeks paid annual leave of employees working a seven day shift roster means that they will be entitled to 21 shifts away from work.
133 This approach is consistent with that adopted by the Full Bench in the Fair Work Commission in RACV Road Service Pty Ltd v Australian Municipal, Administrative, Clerical and Services Union [2015] FWCFB 2881:
[32] [W]e consider that a “week” of leave is to be understood as meaning an authorised absence from the working days falling in a seven day period, and a “day” of leave is an authorised absence from the working time in a 24 hour period. ...
…
[82] Accordingly we conclude that in the NES provisions of the FW Act, a “week” of annual leave is an authorised absence from work during the working days falling in a seven day period, and a “day” of leave (whether of annual or personal/carer’s leave) is an authorised absence from the working time in a 24 hour period. We reject RACV’s submission that “week” and “day” are to be read as terms of art referring to a specific number of working hours that may not constitute an actual week or day in a given case. We further conclude that the amount of leave deducted from an employee’s leave balance necessarily correlates with the amount of leave taken, so that if a week’s annual leave is taken, a week is deducted from the employee’s accrued annual leave balance, and if a day of annual leave or personal/carer’s leave is taken, a day is deducted from the employee’s accrued annual leave or personal/carer’s leave balance.
134 The ordinary hours can still be deducted from an employee’s leave balance as provided for in the EAs. At 10 ordinary hours per shift, 21 shifts equate to 210 hours (or six weeks of 35 hours each). Ten ordinary hours can be deducted for each shift for which the employee is absent on leave. At 8.75 ordinary hours per shift, 20 shifts equate to 175 hours (or five weeks of 35 hours per week). Eight and three-quarter hours can be deducted for each shift for which the employee is absent on leave.
135 In Mr Noyes’ case, his annual leave entitlement from 1 July 2010 under the Black Coal Award and since 16 July 2010 under the EAs has exceeded his NES entitlement, initially by one week (three or four shifts depending on the week in the roster cycle in which the leave was taken) and from 11 October 2010, by two weeks (seven shifts). There was, accordingly, a non-NES entitlement from which the annual leave he took on the public holidays could have been deducted (assuming that that entitlement had not previously been used). Accordingly, this alternative argument of the CFMEU fails.
136 The CFMEU appeal with respect to Mr Noyes’ paid annual leave fails.
The Personal/Carer’s Leave
137 The appeal with respect to alleged contravention of s 44 of the FW Act in relation to Mr Noyes’ absence on the public holiday on 26 January 2011 also fails. The reasons are the same as those applying in respect of the paid annual leave.
138 Earlier in these reasons, we set out the terms of s 98 of the FW Act concerning personal/carer’s leave. As indicated, it is relevantly in the same terms as s 89(1).
139 Clause 22.2.1 of the EAs entitles workers to three weeks paid personal leave per year, which is more than the 10 days per year to which employees are entitled under the NES (s 96). The reasoning set out above indicates that s 98 applies only to that portion of the personal/carer’s leave which matches the NES entitlement. It does not apply to the excess.
Conclusion
140 For the reasons given above, we consider that the appeal should be dismissed. Having regard to s 570 of the FW Act, there should be no order as to costs.
I certify that the preceding seventy-one (71) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices White and Bromwich. |
Associate:
Dated: 28 February 2017
