FEDERAL COURT OF AUSTRALIA

Woolworths Ltd v Shop, Distributive and Allied Employees’ Association

[2013] FCAFC 151

ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA

THE COURT ORDERS THAT:

1.    The appeal is allowed in part.

2.    The declarations made in 1(a), 2(a), 3(a), 4(a) and 5(a) of the orders made by the primary judge on 25 May 2012 are set aside.

3.    The appeal is otherwise dismissed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA

REASONS FOR JUDGMENT

GREENWOOD J:

1    I have had the benefit of reading in draft the reasons for judgment of Buchanan J and also the reasons in draft of Bromberg J. I am grateful to their Honours for the provisions of the legislation set out in their respective reasons and also the relevant provisions of the Enterprise Agreement described as the Woolworths National Supermarket Agreement 2009, negotiated in contemplation of the operation of the Fair Work Act 2009 (Cth) (the “Fair Work Act”).

2    I simply wish to make the following observations.

3    Within the cohort of employees employed by the appellant, Woolworths Limited (“Woolworths”), in Western Australia in the periods December 2010 and January 2011, and December 2011 and January 2012, were employees who were members of the Shop, Distributive and Allied Employees’ Association (the “SDAEA”), or eligible to be members of the SDAEA.

4    Those employees worked hours according to rosters. Some employees were rostered to work hours from Monday to Friday inclusive with Saturday and Sunday rostered free from work hours.

5    Sometimes public holidays fall on a Saturday or Sunday and this appeal is concerned with the entitlements of employees to particular benefits when Christmas Day, Boxing Day and New Year’s Day fell on either Saturday or Sunday in the two periods described earlier, having regard to the rostered hours of work of the particular employees.

6    Section 115(1)(a)(i), (vii) and (viii) of the Fair Work Act provided at the relevant time that 25 December (Christmas Day), 26 December (Boxing Day) and 1 January (New Year’s Day) were each public holidays. These prescribed public holidays formed part of the National Employment Standards under the Fair Work Act: see s 61(3); Divisions 3 to 12 inclusive but particularly Division 10 addressing the topic of “Public holidays” (the “Standards”). The Standards have effect subject to terms (as contemplated by s 55(2)) included in any enterprise agreement that might be made under the Fair Work Act: s 55(3). However, no provision of the Standards can be excluded by an enterprise agreement: s 55(1). An enterprise agreement may include terms ancillary or incidental to the operation of an employee’s entitlement under the Standards or terms that supplement the Standards, but only to the extent that the effect of those terms is “not detrimental to any employee in any respect when compared to the [Standards]” [emphasis added]: s 55(4).

7    Apart from the “public holidays” on 25 December and 26 December and 1 January, a public holiday under the Standards also includes (s 115(1)(b)) any other day or part of a day declared or prescribed under a State law to be observed as a public holiday.

8    Relevantly for this appeal, a law of the State of Western Australia (the Public and Bank Holidays Act 1972 (WA) (the “State Act”)) provides that 25 December, 26 December and 1 January are public holidays in that State. More importantly, the State Act also provides that when 25 December falls on a Saturday or Sunday, the next following Monday “is also a public holiday” (that is to say, “also” conveys “as well as” or “in addition to”) [emphasis added]. As to Boxing Day, should 26 December fall on a Saturday, the next following Monday “is also a public holiday” but should Boxing Day fall on a Sunday (Christmas Day having fallen therefore on a Saturday), the next following Tuesday “is also a public holiday”. When New Year’s Day falls on a Saturday or Sunday, the next following Monday “is also a public holiday” (see s 5 of the State Act in conjunction with Schedule 2 of that Act).

9    It follows that these public holidays falling on either a Monday or a Tuesday having regard to the relevant possibilities as contemplated by the State law, are, relevantly, “any other day … declared or prescribed under a law of a State as a public holiday” [emphasis added] for the purposes of s 115(1)(b) of the Fair Work Act, and thus “public holidays” for the purposes of the Standards.

10    25 December 2010 fell on a Saturday and thus Boxing Day fell on a Sunday. 1 January 2011 was a Saturday. Under the State Act, Monday, 27 December 2010, Tuesday, 28 December 2010 and Monday, 3 January 2011 were also public holidays. Under s 115(1)(b) of the Fair Work Act, these days were “other days” falling within the definition of “public holidays” for the purposes of the Standards.

11    25 December 2011 was a Sunday. Boxing Day therefore fell on a Monday. 1 January 2012 was a Sunday. Under the State Act, Tuesday, 27 December 2011 and Monday, 2 January 2012 were also public holidays. Under s 115(1)(b), of the Fair Work Act, these days were “other days” falling within the definition of “public holidays” for the purposes of the Standards.

12    Although Woolworths contend for a different construction, I am satisfied that the conjunction of the relevant provisions of the Fair Work Act and the State Act operate to bring about the result I have described. I reject the contentions of Woolworths to a contrary construction reliant on the authorities of Shop, Distributive & Allied Employees Association v Woolworths Ltd [2000] FCA 206; and Shop Distributive and Allied Employees’ Association v Woolworths SA Pty Ltd [2011] FCAFC 67 for the reasons identified by Buchanan J.

13    The employees whose entitlements are in issue in this appeal are workers who were rostered to work hours from Monday to Friday inclusive.

14    Clause 7 of the Enterprise Agreement contains terms dealing with the topic of “public holidays”.

15    Clause 7.1 provides that full time and part time employees shall be entitled to a “day off”, without loss of pay, where the employee would ordinarily be rostered to work on Christmas Day, Boxing Day or New Year’s Day or, in the case of Western Australia, Foundation Day. Clause 7.1 recognises the “entitlement” of the employee to a day off without loss of pay in circumstances where the employee would ordinarily be rostered to work on the public holiday. Clause 7.2 provides that when Christmas Day falls on a Saturday or a Sunday, a holiday in lieu of that day shall be observed on 27 December. Should Boxing Day fall on a Saturday or a Sunday, a holiday in lieu of that day shall be observed on 28 December. Should New Year’s Day fall on a Saturday or Sunday, a holiday in lieu of that day shall be observed on the next Monday.

16    Clause 7.3 provides for additional public holidays proclaimed within a State on a day other than the days set out under cls 7.1 and 7.2.

17    Clause 7.4 deals with the topic of “substituted days”. Where a Woolworths store opens for trade on an actual public holiday (that is, the day itself, relevantly, Christmas Day, Boxing Day or New Year’s Day) which has had the cl 7.2 substitution applied of a holiday in lieu to be taken on the nominated dates, the following protocol applies. If a full time or part time employee is ordinarily rostered to work on the actual public holiday and the substituted day, then that employee shall elect which day shall be the public holiday, and the employee shall receive the standard public holiday benefits on that day. The other day shall then be a normal rostered day subject to the operation of cl 7.4.4. If the employee makes an election for the public holiday, under the Enterprise Agreement, to be a day which is not a public holiday under the Fair Work Act, then the employee will also be regarded as having agreed to substitute the holiday under the legislation, to the day the employee so elects. Clause 7.4.4 provides that in the case of Christmas Day, where substitution occurs, work done on 25 December will attract an additional loading of half a normal day’s wage for a full day’s work in addition to the Saturday/Sunday rate, and the employee will also be entitled to the benefits of the substituted public holiday. Clause 7.4.6 makes it plain that the reference to an “actual public holiday” means the day that would otherwise be a public holiday if the substitution contemplated by cl 7.2 had not occurred.

18    Clause 7.7 addresses the topic of a holiday on a non-working day or a rostered day off for full time or part time employees. Clause 7.7.1 provides that a full time employee whose non-working day falls on a public holiday prescribed under cls 7.1, 7.2 or 7.3 (but not cl 7.10.3), and a part time employee (averaging the relevant number of shifts per week whose non-working day falls on a public holiday) prescribed under the cls 7.1, 7.2 or 7.3 (but not cl 7.10.3) shall receive either, another day off in lieu to be taken either within 28 days after the holiday falls (or during the week prior to the holiday), or receive the addition of an equivalent day’s pay, or one extra day added to annual leave.

19    Clause 7.10 deals with rates of pay.

20    Clause 7.10.3 provides that work done by an employee on any day which Woolworths is required to recognise as a public holiday under the Fair Work Act (not being a day otherwise designated as a public holiday for that employee under cls 7.1 to 7.4), will nevertheless be voluntary and paid at the rates set out in cls 7.10.1 and 7.10.2. Clause 7.10.1 provides that work done on any public holiday prescribed under cls 7.1 and 7.2 by a full time or part time employee shall be paid at the rate of 250% with a minimum payment of three hour’s work. Clause 7.10.2 provides that such work done by a casual employee shall be paid at the rate of 270% with a minimum payment of three hour’s work. The cl 7.10.3 circumstances which attract the cls 7.10.1 and 7.10.3 rates of pay are these. First, if Boxing Day falls on a Saturday, the additional holiday falls on either 26 December or 28 December. Second, if Christmas Day falls on a Saturday and Boxing Day falls on a Sunday, the additional holiday(s) falls between 25 December and 28 December (inclusive). Third, if Christmas Day falls on a Sunday, the additional holiday falls between 25 December and 27 December (inclusive). Fourth, if New Year’s Day falls on a Saturday, the additional holiday falls on either 1 January or 3 January. Fifth, if New Year’s Day falls on a Sunday, the additional holiday falls on either 1 January or 2 January.

21    If a full time or part time employee is rostered to work on the days contemplated by cl 7.10.3, and chooses not to work, then the employee will be paid in accordance with the provisions of cls 7.5 and 7.6 which address payment for holidays in circumstances where a store does not open for trade on a public holiday, and also those circumstances where a store opens for trade on a public holiday.

22    As to the intersection between the Standards (as they relate to public holidays having regard to the construction I have adopted) and the Enterprise Agreement in the context of the contentions of the parties as to the entitlement of employees who, on the one hand are rostered to work hours on weekends, and on the other hand, those employees who are not so rostered (being the case of the employees in question in these proceedings), I respectfully agree with the observations of Buchanan J in relation to those questions in terms of the reasoning.

23    I respectfully agree with the orders proposed by Buchanan J in resolution of the appeal.

Associate:

Dated:    5 December 2013

REASONS FOR JUDGMENT

BUCHANAN J:

Background

24    The principal piece of legislation dealing with the regulation of industrial relations across Australia is the Fair Work Act 2009 (Cth) (“the FW Act”). In contrast to earlier periods when federal industrial legislation was based principally upon the constitutional head of power in s 51(xxxv) of the Constitution, federal Parliament may now legislate directly for terms and conditions of employment.

25    Section 43 of the FW Act provides for National Employment Standards to have effect. An employer must not contravene a provision of the National Employment Standards (s 44). An enterprise agreement made under the FW Act must not exclude the National Employment Standards or any provision of the National Employment Standards (s 55(1)). If an enterprise agreement has terms which are ancillary or incidental to the operation of an entitlement under the National Employment Standards, the terms of the agreement may not be detrimental to an employee when compared to the National Employment Standards (s 55(4)).

26    In 2009, the appellant and the respondent made an enterprise agreement which is called the Woolworths National Supermarket Agreement 2009 (“the agreement”). It was negotiated in contemplation of the operation of the FW Act. The agreement commenced to operate on 27 May 2010. It contains provisions which provide for public holidays. Those provisions provide, in some circumstances, for substituted public holidays or holidays in lieu where public holidays (such as Christmas Day, Boxing Day and New Year’s Day) fall on a weekend. In such cases, the provisions of the agreement adjust entitlements in a complex way according to whether employees work or do not work on particular days and permit some election amongst entitlements applying to nominal public holidays and substituted public holidays. The agreement applies throughout Australia. It endeavours to accommodate some local peculiarities. As stated above, under the FW Act the agreement may not be given an operation which reduces entitlements under the National Employment Standards. I shall deal in more detail with the terms of the agreement in due course.

27    The proceedings before the primary judge concerned claims by the respondent for declarations regarding the entitlements of certain employees who were employed by the appellant in Western Australia and who were either members or eligible to be members of the respondent. Those employees work their normal rostered hours Monday to Friday, with weekends normally off work. Their conditions of employment are governed by the agreement. The particular claims concerned entitlements in relation to public holidays (Christmas Day, Boxing Day and New Year’s Day) which fell wholly or partly on weekends in 2010/2011 and 2011/2012, and in relation to “additional” days granted to accommodate that circumstance.

28    The most important specific claim was that employees were entitled to the benefit of any additional public holiday (time off without loss of pay or payment at penalty rates) and, as well, entitled to a further day off (or payment of an equivalent day’s pay) to replace the original public holiday which fell during a weekend.

The legislation

29    The FW Act provides for National Employment Standards dealing with public holidays in the following way in s 115(1) and (2):

115(1)    The following are public holidays:

(a)    each of these days:

(i)     1 January (New Year’s Day);

(ii)     26 January (Australia Day);

(iii)    Good Friday;

(iv)    Easter Monday;

(v)    25 April (Anzac Day);

(vi)    the Queen’s birthday holiday (on the day on which it is celebrated in a State or Territory or a region of a State or Territory);

(vii)    25 December (Christmas Day);

(viii)    26 December (Boxing Day);

(b)    any other day, or part-day, declared or prescribed by or under a law of a State or Territory to be observed generally within the State or Territory, or a region of the State or Territory, as a public holiday, other than a day or part-day, or a kind of day or part-day, that is excluded by the regulations from counting as a public holiday.

(2)    If, under (or in accordance with a procedure under) a law of a State or Territory, a day or part-day is substituted for a day or part-day that would otherwise be a public holiday because of subsection (1), then the substituted day or part-day is the public holiday.

(Emphasis added.)

30    The Public and Bank Holidays Act 1972 (WA) (“WA PBH Act”) provides inter alia (by s 5 and Schedule 2) that the following are public holidays in Western Australia:

New Year’s Day (1st January)

…

Christmas Day (25th December).

Boxing Day (26th December).

When New Year’s Day … or Christmas Day falls on a Saturday or Sunday the next following Monday is also a public holiday and bank holiday.

When Boxing Day falls on a Saturday the next following Monday is also a public holiday and bank holiday.

When Boxing Day falls on a Sunday or Monday the next following Tuesday is also a public holiday and bank holiday.

(Emphasis added.)

31    It is convenient to say at once that, in my view, as a result of the WA PBH Act, on the occasions in Western Australia when New Year’s Day or Christmas Day falls on a Saturday or Sunday or Boxing Day falls on a Saturday, it is followed by an additional public holiday on the next Monday within the meaning of s 115(1)(b) of the FW Act. Similarly, on the occasions when Boxing Day falls on a Sunday or Monday, it is followed by an additional public holiday on the next Tuesday within the meaning of s 115(1)(b) of the FW Act. None of those Mondays or Tuesdays are days referred to in s 115(2) of the FW Act as days which are substituted for the original holiday and become the public holiday.

32    At the end of 2010, Christmas Day fell on a Saturday, Boxing Day fell on a Sunday and 1 January 2011 fell on a Saturday. Accordingly, under the WA PBH Act and the National Employment Standards in s 115 of the FW Act, each of Monday 27 December 2010, Tuesday 28 December 2010 and Monday 3 January 2011 were also public holidays – i.e. not holidays in substitution for or in lieu of Christmas Day, Boxing Day or New Year’s Day but other additional days which were public holidays in their own right.

33    Similarly, at the end of 2011 Christmas Day fell on a Sunday, Boxing Day fell on a Monday and 1 January 2012 was also a Sunday. Accordingly, Tuesday 27 December 2011 and Monday 2 January 2012 were each in Western Australia and, for the purpose of the National Employment Standards in s 115 of the FW Act, public holidays in their own right.

34    The appellant argued against this construction. It contended that the FW Act should not be construed so as to give effect to the prescription by the WA PBH Act of additional public holidays granted in relation to the public holidays identified in s 115(1)(a) of the FW Act.

Prior authorities

35    The appellant relied on two prior decisions of this Court which are said to relate to the present issues – Shop Distributive and Allied Employees Association v Woolworths Ltd [2000] FCA 206 and Shop Distributive and Allied Employees’ Association v Woolworths SA Pty Ltd [2011] FCAFC 67 (as well as the decision at first instance considered by the Full Court). The first case involved the construction of the Woolworths Supermarkets NSW/ACT Agreement 1998. While it involved a consideration of provisions in that agreement dealing with additional holidays, it did not involve resolution of the issues of construction which arise in the present case from the interaction of s 115 of the FW Act and the WA PBH Act. The second case concerned construction of the Woolworths (SA, NT and Broken Hill) Certified Agreement 2006. Section 3A of the Holidays Act 1910 (SA) provided:

Anzac Day

In addition to the days mentioned in Schedule 2, 25 April will be a public holiday and bank holiday but when that day falls on a Sunday, that day and the following Monday will be public holidays and bank holidays.

36    Importantly, the Full Court said (at [10]):

10    It is important to note, at this stage, that the Holidays Act does not govern what are public holidays under the Agreement. The Agreement does that itself.

37    As a matter of construction, informed by history, the Full Court posed and answered the following question at [18]:

The issue currently in contest between the parties may fairly be resolved by asking the following question: given the purpose of public holiday provisions and the purpose of creating additional public holidays, could it be reasonably intended by industrial parties to an industrial instrument that a person would be entitled to the benefit of a public holiday for Anzac Day and on the very next day the provision of another public holiday for Anzac Day? The answer is obvious and must be no.

38    That is not the question which arises in the present case. The intention of industrial parties to an industrial instrument is not the only issue that requires attention. It is not the issue which requires attention so far as the interaction between s 115 of the FW Act and the WA PBH Act is concerned. In my view, the cases relied on do not determine, or assist in the resolution of, the question of statutory construction which arises from that interaction. In my view, the primary judge was correct in his conclusion that under the WA PBH Act (in the two periods referred to earlier) additional public holidays were created when Christmas Day, Boxing Day or New Year’s Day fell on a weekend (and/or Monday in the case of Boxing Day) and that those additional public holidays formed part of the National Employment Standards by virtue of s 115 of the FW Act.

The National Employment Standards

39    One aspect of the matter may now be disposed of. Sections 114(1) and 116 of the FW Act provide:

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.

…

116    If, in accordance with this Division, an employee is absent from his or her employment on a day or part-day that is a public holiday, the employer must pay the employee at the employee’s base rate of pay for the employee’s ordinary hours of work on the day or part-day.

40    Those provisions gave no extra entitlement for the original public holiday to the employees in question, who were, as I have said, Monday to Friday workers. They were absent normally on Christmas Day, Boxing Day and New Year’s Day on the occasions in question, where those days fell on weekends. The claim which was made on their behalf for recognition of those public holidays by further time off, or pay, did not depend directly on the National Employment Standards, even though s 115(1)(b) of the FW Act “picked up” the provisions of the WA PBH Act. The claim depends on the operation and terms of the agreement.

The operative terms of the enterprise agreement

41    In order to understand the basis for the precise claims which arise under the agreement, it is necessary to refer to some particular terms of the agreement. Unfortunately, there is no alternative to setting those terms out in some detail. Clause 7 of the agreement provides as follows:

7.    PUBLIC HOLIDAYS

7.1    HOLIDAYS

Full Time and Part Time employees shall be entitled to a day off, without loss of pay, where the employee would ordinarily be rostered to work on the following days:

7.1.1    The following days shall be taken in addition to the days named above, or in lieu of where stated:

7.2    HOLIDAYS IN LIEU

7.2.1    When Christmas Day is a Saturday or a Sunday, a holiday in lieu thereof shall be observed on 27 December.

7.2.2    When Boxing Day is a Saturday or a Sunday, a holiday in lieu thereof shall be observed on 28 December.

7.2.3    When New Year's Day or Australia Day is a Saturday or a Sunday, a holiday in lieu thereof shall be observed on the next Monday.

7.3    ADDITIONAL HOLIDAYS

Full-time and part-time employees shall be entitled without loss of pay to an additional public holiday or half day within the State, Territory or Locality, when such public holiday or half day public holiday is legislated, proclaimed or gazetted other than on a day set out in subclauses 7.1 or 7.2, and is to be observed generally by persons through the State, Territory or Locality.

Provided that, in NSW (excluding the County of Yancowinna) and the ACT, such additional public holiday or half day public holiday shall be treated as additional paid time off or pay in lieu, but work performed on those days or half days shall not attract public holiday penalty rates (although in other States and Territories any work on such a day or half day will be paid in accordance with subclause 7.10).

7.4    SUBSTITUTED DAYS

Where a store opens for trade on an actual public holiday which has had the substitution provision of subclause 7.2 applied, the following shall apply:

7.4.1    If a full-time or part-time employee is ordinarily rostered to work on the actual public holiday and the substituted day, then that employee shall elect which day shall be the public holiday and receive the standard public holiday benefits on that day. The other day shall then be a normal rostered day subject to paragraph 7.4.4 below. If the employee elects for the Public Holiday under this Agreement to be on a day which is not a public holiday under the Fair Work Act 2009 (or in 2009, the Workplace Relations Act 1996) then the employee will also be regarded as having agreed to substitute the holiday under the legislation to the day so elected.

7.4.2    If a weekly employee is rostered to work on the actual public holiday and not the substituted day, the employee shall receive the standard public holiday benefits on the actual day.

7.4.3     If a full time or part time employee is rostered to work on the substituted day and not the actual Public Holiday, the employee shall receive the public holiday benefits on the substituted day.

7.4.4    In the case of Christmas Day where substitution occurs, work on the 25th December will attract an additional loading of half a normal day's wage for a full day's work in addition to the Saturday/Sunday rate and the employee will also be entitled to the benefits of the substituted public holiday.

7.4.5    Casual employees employed on the actual day of the prescribed holiday shall be paid at the normal rate for the day and be paid the relevant holiday rate for the substituted day.

7.4.6     “Actual public holiday” means the day that would otherwise be a public holiday if substitution as provided in subclause 7.2 had not occurred.

7.5    PAYMENT FOR HOLIDAYS NOT TRADED

Where a store does not open for trade on a public holiday and an employee would have been rostered to work on such a day but does not work, the employee shall be entitled:

7.5.1    in NSW/ACT, Queensland and SA/NT, to payment for the day based upon their ordinary single hourly rate of pay for the hours normally rostered to work; and

7.5.2    in Victoria, Tasmania and Western Australia, to the day without loss of pay, inclusive of any applicable penalties the employee would have received.

Provided that an employee may elect to work with the agreement of the employer and be paid at the rate prescribed by subclause 7.10.

7.6    HOLIDAYS TRADED

Where a store opens for trade on a public holiday, employees who would normally be rostered to work may volunteer to work the day or part thereof and shall be paid the appropriate penalty for time so worked. Provided that when an employee chooses not to work they shall be paid in accordance with subclause 7.5.

7.7    HOLIDAY ON A NON-WORKING DAY OR A ROSTERED DAY OFF

7.7.1    A full-time employee whose non-working day falls on a public holiday prescribed under subclauses 7.1, 7.2, or 7.3 (but not 7.10.3) and a part-time employee who works an average of 5 shifts per week whose non-working day falls on a public holiday prescribed under 7.1 , 7.2, or 7.3 (but not 7.10.3) shall receive by mutual agreement either:

-    another day off in lieu to be taken either within 28 days after the holiday falls or during the week prior to the holiday; or

-    the addition of an equivalent day's pay; or

-    1 extra day added to annual leave.

Provided that the above shall not apply to Anzac Day or Easter Saturday for NSW/ACT and SA/NT.

Provided that the above shall not apply to Anzac Day for Victoria or Tasmania.

Provided that the above will not apply to additional holidays legislated,

proclaimed or gazetted by a State or Territory as provided in clause 7.10.3.

7.7.2    A full time employee whose RDO falls on a public holiday shall receive by mutual agreement either:

-    another day off in lieu to be taken either within 28 days after the holiday falls or during the week prior to the holiday; or

-    the addition of an equivalent day's pay; or

-    1 extra day added to annual leave.

7.7.3    A full-time or part-time employee shall be entitled to the above provisions where the employee works an alternating roster and the public holiday falls on a day on which the employee works in any week of their roster cycle.

For the purpose of this subclause for full-time employees, “day” shall mean 8 hours. In respect of part-time employees "day" shall mean the average number of contract hours rostered per day for the employee prior to the public holiday in the 4 week cycle.

7.8    ABSENCE PRIOR TO/OR FOLLOWING A HOLIDAY

An employee who fails to attend for a rostered shift on the day before or the day after any public holiday shall provide to the Company documentation in accordance with the relevant leave provision of this Agreement.

7.9    WORK ON A PUBLIC HOLIDAY

Work on a public holiday is voluntary for all employees. An employee who elects to

work shall be paid at the rate prescribed by subclause 7.10.

7.10    RATE OF PAY

7.10.1    Work done on any public holiday prescribed in subclause 7.1 and 7.2 by a full-time or part-time employee shall be paid at the rate of 250% with a minimum payment as for 3 hours work.

7.10.2 Work done on any public holiday prescribed in subclause 7.1 and 7.2 by a casual employee shall be paid at the rate of 270% with a minimum payment as for 3 hours work.

7.10.3 Work done by an employee on any day which the Company is required to recognise as a public holiday under the Fair Work Act 2009 in respect of that employee (not being a day otherwise designated as a public holiday for that employee under subclauses 7.1 to 7.4) will nevertheless be voluntary and paid at the rates set out in subclauses 7.10.1 and 7.10.2 where:

(a)    if Boxing Day falls on a Saturday, the additional holiday falls on either 26 December or 28 December;

(b)    if Christmas Day falls on a Saturday and Boxing Day falls on a Sunday, the additional holiday(s) falls between 25 December and 28 December (inclusive);

(c)    if Christmas Day falls on a Sunday, the additional holiday falls between 25 December and 27 December (inclusive);

(d)    if New Year's Day falls on a Saturday, the additional holiday falls on either 1 January or 3 January; or

(e)    if New Year's Day falls on a Sunday, the additional holiday falls on either 1 January or 2 January.

If a full-time or part-time employee is rostered to work on such a day, and chooses not to work, then the employee will be paid in accordance with subclauses 7.5 and 7.6.

Entitlements under the enterprise agreement

42    Under the agreement, Monday to Friday workers were entitled to elect to have the substituted days treated as public holidays, but no continuing entitlement would arise under the agreement itself with respect to the original public holidays. The employees in the present case, having regard to the interaction between the FW Act and WA PBH Act, were already entitled to have the days substituted by the agreement treated as additional public holidays in their own right and to the benefit of any entitlement that arose as a result. Consequently, they were entitled to elect under the agreement to retain the original days as public holidays for the purpose of the agreement and take any benefit arising from them as well. However, for the reasons which follow, that would give them no additional entitlement in practical terms.

43    The claim made by the respondent was two-fold. First, employees were entitled to be absent without loss of pay on each of the days which were identified in the WA PBH Act. In practice, the appellant had no difficulty with that (although it did not accept that the FW Act interacted with the WA PBH Act in the manner claimed by the respondent) because the original days all fell on a weekend (non-working time) and the additional days were all recognised by the agreement as substitute days in any event (clause 7.2). Employees were therefore entitled to be absent on those additional/substitute days without loss of pay (clause 7.1/7.2) or be paid in accordance with clause 7.10.

44    In light of the conclusions earlier expressed, the rate of pay for work done on an additional holiday of the kind earlier discussed (i.e. on a Monday or Tuesday) is governed by clause 7.10.3 of the Agreement. That is not the source of obligation accepted by the appellant, but it leads to the same result because clause 7.10.3 applies the same rate as work “on any public holiday prescribed in subclause 7.1 and 7.2” (clause 7.10.1). Additionally, clause 7.10.3 guarantees that the additional holiday may be taken as a day off paid in accordance with clause 7.5 – i.e. in Western Australia “without loss of pay, inclusive of any applicable penalties the employee would have received” (clause 7.5.2).

45    If the earlier question of construction is decided in the way I favour, there does not appear to remain any practical issue between the parties about an entitlement to be absent without loss of pay or payment at penalty rates for working on the additional holidays. It does not make a difference either that the payment is determined in accordance with clause 7.10.3. There is, however, a very real issue about what happens in respect of the weekend public holidays (Saturday or Sunday) which are not worked because they are normal days off.

46    The second claim by the respondent was at the heart of the issues between the parties. It was that, in addition to the public holiday on the additional days (recognised by time off or payment at penalty rates), employees were entitled to further time off (or payment) because the original days corresponded with non-working days i.e. weekends. This claim depends on clause 7.7.1 of the agreement. The claim by the respondent is that an entitlement arises under clause 7.7.1 to one of the alternative benefits prescribed by that clause. That entitlement is said to arise because the original public holidays are preserved while additional public holidays (to which clause 7.10.3 applies) are created.

47    Clause 7.7.1 must be given effect in accordance with its own terms and the other terms of the agreement. Clause 7.7.1 only applies to public holidays “prescribed under subclauses 7.1, 7.2 or 7.3”. The terms of clause 7.7.1 make it clear that its benefits do not apply to public holidays “prescribed under” clause 7.10.3 or additional holidays “as provided in” clause 7.10.3. That does not take the matter very far because those additional days are not days which fall on weekends. They are additional days falling on a Monday or Tuesday. In order to resolve the question of whether clause 7.7.1 has any application to the weekend days on which Christmas Day, Boxing Day or New Year’s Day actually fall, it is necessary to turn first to the operation of clauses 7.1, 7.1.1, 7.2 and 7.3.

48    Clause 7.1 provides a “core” entitlement to nine (in the case of Tasmania) or ten (in every other State or Territory) public holidays. Clause 7.1.1 provides for stated additional public holidays. None of the additional days are specifically identified as days in lieu of a day stated in clause 7.1.

49    Clause 7.2 then provides for substitution (or holidays in lieu) of Christmas Day, Boxing Day and New Year’s Day where any of those days fall on a weekend. Clause 7.4 makes provision for an election about which day shall be treated as the public holiday for certain entitlements under the Agreement, but further attention need not be given to those arrangements for the purpose of the present case.

50    So far as the agreement is concerned, clause 7.1 is clearly subject to clause 7.2. No entitlement to observance of Christmas Day, Boxing Day or New Year’s Day can arise under clause 7.1 once clause 7.2 is allowed to operate, as it must be, for the purposes of clause 7.7.1. The only possibility for an entitlement therefore is if clause 7.3 is given a construction which is effective to recognise all the holidays prescribed by the WA PBH Act. Even then, there is an immediate problem. Clause 7.3 gives entitlements with respect to “additional” public holidays. Under the WA PBH Act, the “additional” public holidays are not those which fall on weekends. Therefore, even if clause 7.3 was construed in this fashion, in my opinion it does not bring Christmas Day, Boxing Day or New Year’s Day within clause 7.7.1 when they fall on a weekend.

51    In any event, I do not think that clause 7.3 should be construed to refer to the situation arising under s 5 and Schedule 2 of the WA PBH Act referred to earlier. The answer to the question whether clause 7.3 has a meaning which brings into the operation of clause 7.7.1 the additional days prescribed by the WA PBH Act must commence with attention to the phrase “public holiday prescribed under … 7.3” in clause 7.7.1. Clause 7.3 refers to additional public holidays which occur on days “other than a day set out in subclauses 7.1 or 7.2”. As clause 7.1 refers to all the core public holidays, as clause 7.2 refers to substituted holidays (i.e. for Christmas Day, Boxing Day and New Year’s Day) and as the substituted days prescribed by clause 7.2 match exactly those additional days referred to in the WA PBH Act, in my view, the WA PBH Act does not prescribe as public holidays days “other than … a day set out in subclauses 7.1 or 7.2”.

52    Such a construction does not deprive clause 7.3 of its meaning or significance. From time to time there are additional public holidays prescribed for specific purposes. By way of example, the website of the Fair Work Ombudsman lists as public holidays for 2012, additional to those referred to in clauses 7.1, 7.1.1 or 7.2, the following: ACT – nil, NSW – Easter Sunday; Northern Territory – May Day; Queensland – Queen’s Diamond Jubilee; South Australia – Christmas Eve (half day), New Year’s Eve (half day); Tasmania – nil; Victoria – nil; Western Australia – nil. Those identified in NSW, the Northern Territory, Queensland and South Australia for 2012 appear to me to be the types of additional “public holiday or half day” referred to in clause 7.3.

53    It follows from the view I take of the operation of clause 7.3 that the reference in clause 7.7.1 to public holidays prescribed under clauses 7.1, 7.2 or 7.3 is only a reference to core public holidays (or those substituted therefore under clause 7.2), the additional public holidays stipulated in clause 7.1.1 and additional holidays under clause 7.3 which are truly additional ones of the kind I have identified. This construction does not accommodate the additional holidays falling under the WA PBH Act.

54    In any event, even if clause 7.3 has a wider operation it does not bring the original public holidays into clause 7.7.1. Neither does clause 7.1 because it is subject to clause 7.2. The provisions of the FW Act do not assist the respondent. There was no failure, as I earlier observed, to give entitlements arising under the National Employment Standards.

55    By way of contrast, employees whose normal working days include weekends and Mondays and Tuesdays (e.g. Friday – Tuesday workers; Saturday – Wednesday workers or Sunday – Thursday workers) would be entitled to an extra benefit. Such employees (who are not the employees in question in the present case) would be entitled to a double set of benefits by electing to retain the public holidays on their original days under clause 7.4. Those days would attract an entitlement to be absent without loss of pay under clause 7.1 or payment at penalty rates under clause 7.10.1, and the additional days which arose from the interaction between the FW Act and the WA PBH Act would be compensated under clause 7.10.3. Unlike such employees, the employees in the present case do not work on weekends. The public holidays which fall on weekends do not fall on a working day for them and the additional benefits which follow from the operation of the WA PBH Act do not operate in their case.

Conclusion

56    The views I have expressed do not correspond with all of the conclusions of the primary judge. In particular, I do not, with respect, agree that the employees in question are entitled to additional benefits in relation to the original public holidays.

57    With respect to each of the public holidays (Christmas Day, Boxing Day and New Year’s Day) falling on a Saturday or Sunday in 2010/2011 and 2011/2012, the primary judge was asked to make, and did make, declarations to the following effect:

b    the nominal public holiday gave rise to benefits for relevant employees under clause 7.7.1 of the agreement;

b    employees were entitled also to the additional public holiday prescribed by the WA PBH Act;

b    if employees worked on the additional public holiday they were entitled to payment in accordance with clause 7.10.3 of the agreement.

58    I agree that the respondent was entitled to the second and third of the declarations referred to above (a declaration was also made about the circumstances of part-time employees which does not require attention on the appeal). I do not agree that the respondent was entitled to the first declaration. In my respectful view, the primary judge made an error in concluding that clause 7.7.1 applied to Christmas Day, Boxing Day or New Year’s Day where it fell on a weekend in the case of the employees in the present case.

Orders

59    I would allow the appeal in part and set aside the declarations made in 1(a), 2(a), 3(a), 4(a) and 5(a) of the orders made by the primary judge on 25 May 2012.

Associate:

Dated:    5 December 2013

REASONS FOR JUDGMENT

BROMBERG J:

60    Both Christmas Day and Boxing Day fell on a weekend in 2010. In 2011, New Year’s Day fell on a Saturday. Later in 2011, Christmas Day fell on a Sunday. In 2012, New Year’s Day also fell on a Sunday. As these were the days on which each of those particular religious or other occasions were celebrated, for ease of identification I shall call them the “Celebration Days”.

61    This appeal raises an issue about the public holiday entitlements some of the appellant’s (“Woolworths”) Western Australian employees had in relation to the Celebration Days. The determination of that issue requires consideration of the Fair Work Act 2009 (Cth) (“the FW Act”); the Public and Bank Holidays Act 1972 (WA) (“the WA PBH Act”); and an industrial agreement made between Woolworths and its employees known as the Woolworths National Supermarket Agreement 2009 (“the Agreement”).

62    The reasons for judgment of Buchanan J set out the relevant facts, the relevant legislative provisions and the relevant clauses of the Agreement. I need not repeat that exercise.

63    I respectfully agree with Buchanan J, for the reasons he has given, that the primary judge correctly concluded that the WA PBH Act had the effect of designating an additional (rather than a substituted) public holiday in relation to each of the Celebration Days (“the Additional Days”). I also agree that the Additional Days were each recognised “public holidays” for the purposes of the public holiday entitlements of the National Employment Standards (“the NES”) prescribed by the FW Act. Those conclusions dispose of grounds 8 and 9 of Woolworth’s appeal.

64    There is then left, as the reasons for judgment of Buchanan J recognise, a single practical issue between the parties. That issue is whether Woolworth’s Monday to Friday employees in Western Australia (“the WA Monday to Friday employees”), who were not rostered to work on a Celebration Day, were entitled to the benefits of sub-cl 7.7.1 of the Agreement in relation to such a day. The respondent union (“the SDA”) claimed on behalf of each of those employees that as well as the entitlement to an Additional Day (recognised either by time off or payment), the employee was, in relation to each of the Celebration Days, entitled under sub-cl 7.7.1 of the Agreement to:

-    another day off in lieu to be taken either within 28 days after the holiday falls or during the week prior to the holiday; or

-    the addition of an equivalent day’s pay; or

-    1 extra day added to annual leave.

65    The answer to that question in relation to each of the Celebration Days depends on whether, in respect of the WA Monday to Friday employees, the day fell on a public holiday recognised as such for the purposes of sub-cl 7.7.1 of the Agreement.

66    The primary judge rejected Woolworth’s contention that the benefits afforded by sub-cl 7.7.1 are limited to public holidays recognised expressly by the terms of the Agreement. In arriving at that view, the primary judge construed the word “prescribed” as used in sub-cl 7.7.1 to mean “referred to”. His Honour reasoned that as each of the Celebration Days was referred to in sub-cl 7.1, a WA Monday to Friday employee was entitled to claim the benefit of sub-cl 7.7.1 in respect of a Celebration Day that fell on a non-working day.

67    By grounds 3 and 4 of the grounds of appeal, Woolworths contests those findings. Woolworths contended that the expression “prescribed under” has the meaning of “designated by” such that each of sub-cls 7.1, 7.2 or 7.3 of the Agreement is to be given operative effect. It further contended that, in the circumstances postulated, cl 7.2 “worked an automatic substitution in accordance with its terms and accordingly sub-cl 7.7.1 had no application”.

68    Clause 7 is a badly drafted clause. It is not a clause to which a technical or literalist approach to construction should be adopted because, if there is one thing which is clear, it is that the clause was not drafted by a technician.

69    The eligibility criteria for the benefits which sub-cl 7.7.1 affords is found in the opening words of sub-cl 7.7.1 as qualified by the provisos which appear at the foot of the sub-clause. The relevant opening words extend the benefits of sub-cl 7.7.1 to employees “whose non-working day falls on a public holiday prescribed under sub-cls 7.1, 7.2 or 7.3 (but not 7.10.3)”. Those words and the provisos later found in the sub-clause, must be considered in the context of cl 7 as a whole and also by reference to the nature of the Agreement.

70    As to the nature of the Agreement, the primary judge found that the parties may be taken to have made the Agreement accepting the operation and force of the FW Act. He determined that cl 7 should be construed in the knowledge that it operates in the context of the NES provided by the FW Act. I agree with that approach to the construction of cl 7. That seems to me to be a consideration of some importance.

71    A second consideration of some significance is that cl 7 is dealing with public holiday related benefits which may flow to an employee when, on the one hand, the public holiday falls on a working day for that employee (sub-cls 7.1, 7.2 and 7.3) and, on the other hand, the public holiday falls on a non-working day for that employee (sub-cl 7.7.1). All of those sub-clauses specify eligibility for a benefit by reference to a criteria which poses two essential questions. First, whether the day in question is a working or non-working day for the employee. Secondly, whether or not the day is recognised as a public holiday for that employee.

72    It would ordinarily be expected that an Agreement dealing with public holiday benefits across a number of different provisions, would consistently across all of those provisions, recognise a day as a public holiday in respect of a particular employee, unless it expressly provided to the contrary. That scheme seems to be adopted by clause 7. The reference to “sub-cls 7.1, 7.2 or 7.3” in the eligibility criteria for sub-cl 7.7.1 reflects that approach and the three provisos contained in sub-cl 7.7.1 expressly identify the extent to which consistency was not intended.

73    The first proviso excludes Anzac Day and Easter Saturday for employees employed in New South Wales, the Australian Capital Territory, South Australia and the Northern Territory. The second proviso excludes Anzac Day for employees in Victoria and Tasmania. The third states:

Provided that the above will not apply to additional holidays legislated, proclaimed or gazetted by a State or Territory as provided in cl 7.10.3.

74    The third proviso reflects the words in parenthesis “but not 7.10.3” found in the opening words of sub-cl 7.7.1. The two references to sub-cl 7.10.3 should be viewed as dealing with the same single exclusion. That exclusion identifies the nature of the days to be excluded as “additional holidays legislated, proclaimed or gazetted by a State or Territory”. That description applies also to the nature of the days recognised by sub-cl 7.3. However, rather than referring to sub-cl 7.3, the proviso ends with “as provided in cl 7.10.3”. That reference and the identification in paragraphs (a) to (e) of sub-cl 7.10.3 of particular “additional” public holidays, makes it clear that only the “additional” holidays legislated, proclaimed or gazetted by a State or Territory which are specified in paragraphs (a) to (e) are to be excluded.

75    The terms of sub-cl 7.10.3 acknowledged that the parties to the Agreement understood that the requirement to recognise a day as a public holiday may be sourced in the FW Act. Those terms together with the third proviso in sub-cl 7.7.1 suggest that the parties operated on the understanding that despite such a requirement, the benefits afforded by sub-cl 7.7.1 were supplemental to the benefits required by the FW Act (through the NES) and could be excluded in relation to a day that the FW Act required be recognised as a public holiday. On that understanding, sub-cl 7.10.3 shows that the parties selected some days (“additional days”) for such exclusion but not others. They did so in the knowledge that pursuant to the WA PBH Act, other days such as New Year’s Day, Christmas Day and Boxing Day were recognised public holidays.

76    All of that, together with the inclusion in sub-cl 7.7.1 of the first two provisos, shows that a considered approach was taken by the parties to the Agreement in selecting those recognised public holidays to which the benefits of sub-cl 7.7.1 would or would not flow. New Year’s Day, Christmas Day and Boxing Day for WA employees were not expressly selected.

77    The benefits provided by sub-cl 7.1 of the Agreement are, by reference to the terms of the Agreement, subject to the substitution provisions of sub-cl 7.2. However, as the primary judge determined, the provisions of sub-cl 7.2 are inconsistent with the FW Act in relation to Western Australian employees and insofar as those provisions reduce, alter or affect the entitlement of a Western Australian employee under the NES, are of no effect.

78    In relation to the Celebration Days, that is because each of those days was recognised as a public holiday by s 115(1) of the FW Act and there has been no substitution of the day made by a law of a State or Territory pursuant to s 115(2). For Western Australian employees substitution of the kind contemplated by sub-cl 7.2 would be inconsistent with the NES and rendered ineffective by ss 55(1), 55(4) and 55(7) of the FW Act.

79    The Agreement was made in the knowledge that it would operate in the context of the FW Act and the NES. The Agreement was also made in circumstances where a considered approach was taken to which days recognised as public holidays by the FW Act would be excluded from the benefits accorded by sub-cl 7.7.1. The chosen exclusions were identified expressly. The terms of the Agreement support the conclusion that the likely intent of the parties was that a public holiday recognised in respect of a particular employee would be so recognised consistently across cl 7 for all purposes, unless the contrary intent was expressly stated. In that context, it seems to me that sub-cl 7.7.1 intends that if by operation of the Agreement in accordance with the FW Act, a day is recognised as a public holiday for a particular employee for the purposes of sub-cl 7.1, 7.2 or 7.3, is also to be recognised under sub-cl 7.7.1 unless expressly excluded by a proviso in that sub-clause.

80    For the Western Australian Monday to Friday employees, each of the Celebration Days were recognised as public holidays by sub-cl 7.1 and not excluded by the operation of sub-cl 7.2. Those days were brought into sub-cl 7.7.1 by the reference in that sub-clause to sub-cl 7.1. None of those days were excluded by the provisos in sub-cl 7.7.1.

81    If, despite the construction which I prefer, sub-clause 7.1 is to be construed as subject to sub-clause 7.2, the result would nevertheless be the same. On that basis, the Celebration Days were not days recognised as public holidays for Western Australian employees by the terms of sub-clauses 7.1 and 7.2. As such, the Celebration Days were “additional” public holidays for Western Australian employees within the meaning of sub-clause 7.3 and by that route brought into sub-cl 7.7.1.

82    I have come to that conclusion appreciating that there are two competing constructions open as to the meaning of the word “additional” in sub-cl 7.3. On one construction, “additional” is to be read to mean a day recognised as a public holiday by a State, Territory or locality which is additional to a day already referred to by sub-cls 7.1 and 7.2. If the day in question is already referred to by those sub-clauses (whether recognised by them as a public holiday or not) it is not to be regarded as “additional”. The alternative construction, which I prefer, is that a day recognised as a public holiday by a State, Territory or locality is to be regarded as “additional” when the day has not already been recognised as a public holiday by sub-cls 7.1 and 7.2.

83    Sub-clauses 7.1 and 7.2 do not contain a list of public holidays which have universal application to all employees across Australia. The recognition of many of the public holidays referred to varies from place to place and is, in that respect, location specific. Many of the public holidays referred to and in particular those that are locality specific are not ‘core’ pubic holidays in the sense that the use of the word “additional” in sub-cl 7.3 should be regarded as intending to indicate a day additional to the ordinary or, in other words, an ‘extra-ordinary’ public holiday. In my view, the word “additional” in sub-cl 7.3 is used in its ordinary sense of ‘added, extra or supplemental’ to what is already provided for. The word “additional” or the phrase “in addition” is clearly used in that sense in sub-cl 7.1.1. The clause is dealing with the provision of an additional benefit. In that context, it seems to me that a limitation based on what has already been provided for is more consistent with the purpose of the clause than a limitation based simply on what has earlier been referred to.

84    Unlike the use made of “additional” in sub-cl 7.10.3, the use of the word “additional” in sub-cl 7.3 is not confined to days characterised as “additional” by the State, Territory or locality which has proclaimed the public holiday.

85    Although my reasoning differs from that preferred by the primary judge, it follows that in my view the primary judge was right to conclude that a WA Monday to Friday employee was entitled to claim one or other of the benefits provided by sub-cl 7.7.1 in respect of a Celebration Day which fell on a non-working day for that employee.

86    The respondent was entitled to the declarations made by the primary judge. I would dismiss the appeal.

Associate:

Dated:    5 December 2013