FEDERAL COURT OF AUSTRALIA
Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union v Ardmona Foods Limited [2006] FCA 1039
AUTOMOTIVE, FOOD, METALS, ENGINEERING, PRINTING AND KINDRED INDUSTRIES UNION v ARDMONA FOODS LIMITED (ACN 004 090 082) and SPC ARDMONA OPERATIONS LIMITED (ACN 004 077 105)
VID 1452 of 2004
RYAN J
11 AUGUST 2006
MELBOURNE
|
IN THE FEDERAL COURT OF AUSTRALIA |
|
|
VICTORIA DISTRICT REGISTRY |
VID 1452 of 2004 |
|
BETWEEN: |
AUTOMOTIVE, FOOD, METALS, ENGINEERING, PRINTING AND KINDRED INDUSTRIES UNION Applicant
|
|
AND: |
ARDMONA FOODS LIMITED (ACN 004 090 082) First Respondent
SPC ARDMONA OPERATIONS LIMITED (ACN 004 077 105) Second Respondent
|
|
JUDGE: |
RYAN J |
|
DATE OF ORDER: |
11 AUGUST 2006 |
|
WHERE MADE: |
MELBOURNE |
THE COURT ORDERS THAT:
1. A penalty of $440.00 be imposed on the second respondent in respect of its breach of cl 15 of the SPC Operations Limited Certified Agreement AMWU (Food and Confectionery Employees) 2001.
2. The said penalty be paid to the applicant within 30 days of this Order.
3. The application be otherwise dismissed.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
|
IN THE FEDERAL COURT OF AUSTRALIA |
|
|
VICTORIA DISTRICT REGISTRY |
VID 1452 of 2004 |
|
BETWEEN: |
AUTOMOTIVE, FOOD, METALS, ENGINEERING, PRINTING AND KINDRED INDUSTRIES UNION Applicant
|
|
AND: |
ARDMONA FOODS LIMITED (ACN 004 090 082) First Respondent
SPC ARDMONA OPERATIONS LIMITED (ACN 004 077 105) Second Respondent
|
|
JUDGE: |
RYAN J |
|
DATE: |
11 AUGUST 2006 |
|
PLACE: |
MELBOURNE |
REASONS FOR JUDGMENT
1 This is an application by the applicant, the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (“the Union”) for the imposition on the first respondent Ardmona Foods Limited (“Ardmona”) and the second respondent SPC Ardmona Operations Limited (“SPC”) of penalties under s 178 of the Workplace Relations Act 1996 (Cth) (“the Act”) for a contravention respectively of cl 7.3(viii) of the Ardmona Foods Limited Certified Agreement AMWU (Food and Confectionery Employee) 2001 (“the Ardmona Agreement”) and cl 15.5.5 of the SPC Operations Limited Certified Agreement AMWU (Food and Confectionery Employees) 2001 (“the Shepparton Agreement”).
The alleged breach of cl 15.5.5 of the Shepparton Agreement affecting Mr Duncan
2 Mr Duncan has been employed as a seasonal worker at the food processing factory of Ardmona at Mooroopna and that of SPC at Shepparton. He has worked at one or other of those factories in each season over most of the last thirty years. The “season” is the period beginning in summer when large quantities of fruit are available for processing. The rest of the year is referred to as the “off-season.” In the ten seasons or so in which he did not work for Ardmona or SPC, Mr Duncan was employed as a mortician at the local hospital. In the course of working at the factories, Mr Duncan undertook a wide range of jobs, encompassing almost every processing machine, and also performed, at times, the duties of a leading hand.
3 During 2000, Mr Duncan worked intermittently for Ardmona during the off-season and he obtained more regular work into the summer of that year after the season had commenced. Towards the end of the season in 2001, he sustained a leg injury which was unrelated to his work for Ardmona. As a result of his injury, he elected not to work for either company during the 2001-2002 summer season. However, at the end of 2002, he applied to each of Ardmona and SPC for work in the 2002-2003 season and accepted an offer from SPC to work at its plant early in 2003. Work during that period was intermittent and, for a time, Mr Duncan was transferred to night shift which he found uncongenial. Nevertheless, he carried out the duties assigned to him until he was returned to work on day shift under the supervision of Mr Maskell. At the end of the 2002-2003 season Mr Duncan was given by Mr Maskell a “ratings slip” which effectively accorded him a “B” rating. Mr Duncan disputed the appropriateness of that rating and pressed Maskell to change it. After that request was declined, Mr Duncan arranged for Mr Campbell, the Union’s organiser, to attend a meeting with Mr Ottrey, who was then the Human Resources Manager for SPC.
4 The meeting occurred on 29 May 2003 and was attended by Mr Duncan, Mr Campbell, Mr Driver, who was the Union’s shop steward at the Shepparton site, and Mr Ottrey. Representations were made to Mr Ottrey to the effect that Mr Duncan’s rating should be changed from “B” to “A”. There is a dispute on the evidence about what happened next. According to Mr Duncan, Ottrey said that he would see what he could do but would first have to confer with Mr Maskell and left the meeting for a short time before returning to say that Duncan’s rating had been upgraded to an “A”. Mr Campbell’s recollection accorded with that of Mr Duncan. Mr Driver’s account was in these terms;
‘Towards the end of the meeting Mr Ottrey said words to the effect, “I’ll have to go out and call Graeme Maskell and Leo Hegarty and I’ll come back in 10 minutes”. After so saying, Mr Ottrey left the meeting and he returned about 10 minutes later. On Mr Ottrey’s return to the meeting he said words to the effect of, “I have spoken to Leo Hegarty and Graeme Maskell and I’ll change the rating to an “A” rating.”’
5 Mr Driver was at first disposed to believe that the meeting had occurred on 19 May rather than 29 May and that he had made a record in the diary which he kept as a shop steward of what had happened at the meeting. However, when the diary was produced on the second day of the hearing it was devoid of a relevant entry for either 19 or 29 May 2003.
6 Mr Ottrey has denied that he said that he had to confer with Maskell before he could do anything about the rating or that, on returning to the meeting, he said that he had spoken to Maskell. As well, Mr Ottrey has sworn that he did not speak to either Maskell or to Leo Hegarty who, as Shift Controller, was Maskell’s direct supervisor. According to Mr Ottrey, all he did was to instruct Ms Bennett to issue an “A” rating slip which was sent to Mr Duncan under cover of a letter dated 29 May 2003 in the following terms;
‘Please find enclosed your Seasonal Employment Report which has been completed by your Supervisor at the Shepparton Site. It summarises our Company’s assessment of your work performance during the season and also gives you an indication of your prospects for re-employment next season, should you choose to re-register your availability.
If you have any queries, or would like to discuss your assessment, please telephone the Human Resources Department on (03) 58333814.
If you wish, you can ask us to arrange a meeting with your supervisor and/or Shop Steward to clarify any problems you may have, or discuss your appraisal further.’
The letter was signed by Ms Bennett for “Roger Ottrey, HUMAN RESOURCES MANAGER.”
7 In the “Remarks” section of the new slip, which was dated 28 May 2003, it was noted “amended rating as per instructions by Roger Ottrey 28/5/03.” In the space for a supervisor’s signature the word “per” was written followed by Ms Bennett’s signature.
8 It is common ground that, despite the revision at the instance of Mr Ottrey of his rating to an “A”, Mr Duncan was not offered re-employment as a seasonal worker for the 2004 season. That apparently occurred because Mr Bertolus who, in January 2004, succeeded Mr Ottrey as Group Employee Relations Manager, contacted Mr Maskell and put Mr Duncan’s rating “back to the status that it was – as it should have been”. When Mr Duncan complained of SPC’s failure to offer him employment for the new season, Mr Bertolus was unconcerned about the events which had led to the substitution of the “A” rating which he regarded as “irrelevant”. Subsequently, a meeting was held on 17 March 2004 attended by Mr Campbell of the Union, Mr Duncan and his daughter, Fiona Duncan, and Ms Close who was a leading hand on the line on which Mr Duncan had formerly been employed as a seasonal worker. The principal purpose of the meeting was to canvass Ms Duncan’s prospects of re-employment but, in the course of it, Mr Campbell adverted to Mr Duncan’s situation, whereupon Mr Bertolus said words to the effect that he or the company retained the right to decide, or the final say, as to who should be offered re-employment regardless of any rating.
9 The narrow question raised by these facts is whether SPC contravened cl 15.5.5 of the Shepparton Agreement when it declined to re-employ Mr Duncan in spite of his rating having been raised, at the direction of Mr Ottrey, from a “B” to an “A”. However, SPC does not concede that, had Mr Duncan been treated in January 2004 as the holder of an “A” rating, he would have been offered re-employment for that season. On the other hand, it has not been suggested that anything in respect of Mr Duncan was not “considered equal” in terms of cl 15.5.5 of the Shepparton Agreement so as to disentitle him to the higher opportunity for employment which would have attached to an “A” rating had he been treated as holding it.
10 Clause 15 of the Shepparton Agreement was in these terms:
‘15. SEASONAL RECRUITMENT PROCESS
15.1 All seasonal recruitment activity will be conducted by CVGT working as a resource for SPQ
15.2 Registration process to be refined and cards reviewed and changed;
15.3 Induction sessions will need to be longer to cover
* Safety (incl.Footwear provision)
* EEO
15.4 A full review of the total process will be conducted prior to the commencement of the 2002 season with union participation.
15.5 The Temporary Appraisal Process will be as follows-
15.5.1 Supervisors to assess employees as either A, B or C, based on both performance and/or behavior.
15.5.2 Counselling as to performance and/or behavior issues. Corrective strategies will be identified and implemented immediately.
15.5.3 Fortnightly reviews of 'C' rated employees will be conducted by the Factory Management Team to identify performance/behavior below standard and if there are any inconsistent ratings. This will allow 'C' rated employee's opportunities to work in areas of the business where they are best suited. An employee rated 'C' in two consecutive meetings will be counselled and given reasons with a 2-week review period.
15.5.4 Employees will be notified of ratings prior to the completion of their employment period.
15.5.5 Subsequent employment periods will be based on prior ratings and everything Considered equal the higher the rating the more opportunity for reemployment.
This process does not negate the Employee Conduct and Discipline process.
15.6 Where an identified need has arisen to provide training for Temporary or potential Temporary employees the training shall be conducted in the following way;
15.6.1 Payment shall be a minimum of 7.6 hours for day and afternoon shift and 4 hours for night shift.
15.6.2 Training will take the form of theory and/or practical orientation.
i) The theory component shall where possible be conducted on the SPC site and by SPC personnel.
ii) The practical component of the training will be delivered at the applicable line and machine, and shall consist of observing operators and performing functions. When the trainee operator is performing the duties associated with the position, it shall be done so under full supervision and, at no time shall a trainee operator be left unsupervised by the person responsible for training and that the trainee be allowed to continue operating the machine or performing the functions. However, should an employee engaged under this provision be required to perform an actual role then the provisions of sub-clause 8.4.3 shall apply.’
11 The reference in cl 15.5.5 to the “Employment Conduct and Discipline process” was either to cl 40 of the Shepparton Agreement or to an agreement (“the 1987 Agreement”) which had been concluded in about 1987 between the Union and Ardmona to govern the selection of seasonal employees. Clause 40 of the Shepparton Agreement stipulated:
‘DISCIPLINARY PROCESS
40.1 The parties acknowledge the importance of a clear and effective Disciplinary Policy being fundamental in attaining production efficiencies, sound safety and effective employee relations. An Effective Disciplinary Policy is also essential to ensure equity and fairness in situations where the conduct or performance of an employee gives rise to complaint or concern.
40.2 No employee will be unfairly dismissed. Summary dismissal will only be considered in cases of proven gross misconduct: eg: assault.
40.3 Otherwise, any incidents of misconduct or inadequate performance will be subject to the following procedure, the aim of which is to enable the individual to achieve the appropriate work standards and behaviour required.
(i) Counselling: is an essential part of any performance review or employee of a work related problem, to correct the problem and prevent further recurrence. The aim should be to counsel and correct rather than to police and punish. Counselling is an opportunity to clarify with the employee any expected performance or behaviour, thus providing an employee with an opportunity to correct the problem and perform work in a desired mariner [sic].
(ii) A Verbal Warning: will be given by the appropriate departmental manager for any aspects of conduct or inadequate performance which emerge as a problem.
A 3-month time limit will be placed on verbal warnings (with the exception of serious issues such as harassment).
However, if an employee re-offends within a 6-month period (after the expiry of the 3 month warning) the initial warning will be available for inclusion in the process.
(iii) First Written Warning: will be issued if it is clear that a verbal warning has not achieved the desired improvement. This warning will identify the areas of concerns and emphasise that in the absence of future improvement, continued unsatisfactory performance or conduct will result in further disciplinary action up to and including dismissal.
(iv) Final Written Warning : will be issued by Department Managers in the presence of an employee nominated witness and the appropriate Shop Steward. They will be informed that any further unsatisfactory performance or misconduct will result in immediate dismissal. A copy of this warning will be kept by the Department Manager.
(v) Dismissal: After conducting disciplinary interviews to facilitate a thorough investigation of all the issues and facts and giving the employee appropriate opportunity to offer an explanation or respond to any allegations, it shall be open for management to terminate the services of the employee either with or without notice in accordance with the Parent Award. Dismissal will not occur without the presence of General Manager Operations and/or the Manager Human Resources. If both these managers are absent, the relevant Department Manager will conduct any investigation/dismissal procedure.
40.4 Except where summary dismissal is justified after a thorough investigation, this process will precede any decision to dismiss.
40.4 At any stage an appeal can go to the next level of management and an individual will have the right to be represented by the relevant Shop Steward at all stages.’
12 The 1987 Agreement was in these terms:
‘PROPOSED PROCEDURE
SELECTION OF SEASONAL F.P.U. EMPLOYEES
AIMS -
1. To implement a procedure that is fair and reasonable.
2. That is clearly understood and capable or working with the full cooperation of Management, Employees and Union.
3. That assists in the improvement of the overall performance of the seasonal workforce, and therefore the production and quality of Ardmona products.
4. That provides incentive to seasonal employees who have performed well, through a reasonable expection [sic] of re-employment in subsequent seasons.
5. That provides an opportunity for new employees to join the seasonal workforce and an indication of their prospects of re-employment in subsequent seasons.
6. That is sufficiently flexible to adjust to the various factors that affect seasonal operations such as: fruit availability, market conditions, changes to processes and technology, economic factors etc.
7. That continues to provide limited opportunities for employment to post-secondary students to assist in their aim to complete their studies.
SELECTION PROCEDURES -
APPRAISAL -
1. Each Supervisor will, prior to cessation of seasonal employment, summarise the work performance of each employee within his/her area of responsibility. It would be expected that this summary would be completed in consultation with the Leading Hand(s) directly responsible for that employee.
The summary will result in the allocation of a "Grade" to each employee, as follows –
|
A |
- |
SATISFACTORY This employee has contributed a satisfactory level of work performance and reliability throughout the season |
|
B |
- |
IMPROVEMENT NEEDED This employee needs to improve aspects of their work performance or reliability to reach a satisfactory standard. Details of improvement required must be given |
|
C |
- |
UNSATISFACTORY This employee has proven unsuitable for the available work, or has been subject to disciplinary action. Details of unsatisfactory aspects must be given. |
SELECTION PROCEDURES
1. Any person seeking seasonal employment must register their availability with the Personnel Department through correct channels.
2. Supervisors will select from listings of registered applicants, provided by the Personnel Department. Lists will include details of prior work performance and shift preference.
Work performance contributed during the previous season will be the major factor in selecting registered applicants.
|
A |
= |
These employees can have a reasonable expectation that they will be re engaged progressively as processes in which they are experienced 'scale-up'. |
|
B |
= |
These employees can have a reasonable expectation of re engagement, although A rated employees will receive preference. These employees will be expected to improve their work performance as indicated if they seek re engagement in. future seasons. |
|
C |
= |
These employees will be re engaged solely at the discretion of the Company and should have no expectation of re engagement. |
4. NEW EMPLOYEES
New employees assessed as being potentially suitable for the work available will be engaged progressively throughout the season. Re engagement in subsequent seasons will be subject to assessed work performance, as per 3.
5. STUDENTS
Post secondary students (to maximum agreed levels) will be engaged during the vacation period (Dec - Feb). Junior employees, (ie under 18) will be engaged subject to Award and Department of Labour restrictions.
6. DISPUTES OR GRIEVANCES
An employee who believes that their grading allocated is unfair or unreasonable may lodge an objection with their Supervisor.
If the grievance remains unresolved between employee and Supervisor, it will be resolved with the Union through the. agreed disputes procedure.
If the grievance is unresolved after the end of the season, it shall be resolved during the 'off season' and the individual advised of their final grading prior to registrations for the following season.’
13 Annexed to the 1987 Agreement was a pro forma “rating slip” of the kind given to Mr Duncan at the end of the 2002-2003 season. The standard form slip was prefaced by these notes:
‘This report is completed by your Supervisor and summarizes the Company’s assessment of your work during the season.
It also includes an indication of your prospects for future employment, should you register your availability next season.
Please note that prospects for future employment are subject to suitable work being available and seasonal variables.’
It ended with this statement:
‘PLEASE NOTE: If you consider this report is unfair or unreasonable you should discuss it with your Supervisor as soon as possible.’
Respondent’s submissions
14 Dr Jessup QC, who appeared with Mr P Wheelahan of Counsel for the respondents contended that the relevant period at the end of which Mr Duncan was to receive his rating was that which ended on 10 April 2003 when Mr Maskell assigned him a “B”. In a related way, it was said that the “supervisor” who was to assign a rating was, in the context of cl 15 of the Shepparton Agreement, a “persona designata”, so that a rating could not be assigned or changed by anybody other than a “supervisor” of the relevant employee. “Supervisor” in that sense was claimed to connote an employee having “line level responsibility”, such as a foreman or leading hand. In no sense, so the argument went, could it comprehend a human resources manager. The same distinction was preserved, in the respondent’s submission, by cl 7.3 of the Shepparton Agreement which provided for an employee to have discussions at three levels, first with his or her immediate supervisor, then with the department manager and finally with “senior management.” Even if “senior management” were to direct that an employee’s rating be changed, that could only be effected if “the hand that held the pen” were that of an operational supervisor who was the “persona designata” under cl 15.
15 It was next contended on behalf of the respondent that the meeting on 20 May 2003 was not a “disputes procedure meeting” but was simply an initiative taken by Mr Campbell to fix an industrial problem.
16 Finally in relation to Mr Duncan, Dr Jessup argued that SPC could not be estopped from denying that his rating had been changed from “B” to “A” because to recognise an estoppel of that kind would be tantamount to permitting the parties to contract out of the Shepparton Agreement; see eg Welsh v Commercial Travellers Association [1940] VLR 259 and Metropolitan Health Service Board v Australian Nursing Federation (2000) 99 FCR 95. In the latter case, French J said, at 103 [18] and [20];
‘… The award is independent of contract. It is neither incorporated by statute nor by implication into the contract of employment – Byrne v Australian Airlines Ltd (1995) 185 CLR 410. Nor can those bound by an award contract out of it – Josephson v Walker (1914) 18 CLR 691 at 700 (Isaacs J) approved in Byrne at 421. That is not to say that a contract may not be made which confers benefits upon an employee over and above those conferred by the award – Byrne at 421. Nor does it prevent parties from expressly agreeing to incorporate the terms of an award into their contract of employment thus providing remedies over and above those provided by statute – True v Amalgamated Collieries of WA Ltd [1940] AC 537 adopted in Byrne at 420 and 444.
… …
The inability to contract out of an award by virtue of its statutory operation militates against the proposition that parties may be estopped from enforcing its provisions or may waive its benefits in a way that is legally enforceable. The effect of the statutory provisions which give awards their binding force are at least as powerful against the common law and equitable principles of estoppel and waiver as they are against the common law of contract. There is nothing novel in the general proposition that statutes which preclude contracting out of the rights and obligations they confer will defeat the application of estoppel and waiver to like effect – Beckford Nominees Pty Ltd v Shell Co of Australia Ltd (1986) 73 ALR 373 at 378 (Pincus J).’
17 Goldberg J in Textile Clothing and Footwear Union of Australia v Givoni Pty Ltd (2002) 121 IR 250 similarly emphasised that it is not possible to contract out of award obligations and the principles of estoppel and waiver do not apply in relation to those obligations.
18 The corollary of Dr Jessup’s argument in this respect, he acknowledged, is that, if an award or an agreement contemplates the taking of some step such as the change of a “B” rating to an “A”, the party seeking to enforce the award or agreement must first compel that step to be taken in the manner stipulated in the award. That was said to be a reasonable requirement because of the potential impact on other applicants for employment of a change in a rating.
19 The respondents disputed that Mr Ottrey had ostensible authority to change Mr Duncan’s rating. The limits on his ostensible authority were indicated by cl 15.5.1 which required assessments to be made by “supervisors” as was well-known to Mr Campbell and Mr Duncan.
20 As an alternative to his argument that estoppel did not avail the applicant in this case, Dr Jessup contended that if, contrary to his primary position, estoppel were theoretically available, some of the requirements enumerated by the High Court in Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387 had not been satisfied. In that case Brennan J identified the six matters which a plaintiff must prove in order to establish equitable estoppel. His Honour there said;
‘In my opinion, to establish an equitable estoppel, it is necessary for a plaintiff to prove that (1) the plaintiff assumed that a particular legal relationship then existed between the plaintiff and the defendant or expected that a particular legal relationship would exist between them and, in the latter case, that the defendant would not be free to withdraw from the expected legal relationship; (2) the defendant has induced the plaintiff to adopt that assumption or expectation; (3) the plaintiff acts or abstains from acting in reliance on the assumption or expectation; (4) the defendant knew or intended him to do so; (5) the plaintiff's action or inaction will occasion detriment if the assumption or expectation is not fulfilled; and (6) the defendant has failed to act to avoid that detriment whether by fulfilling the assumption or expectation or otherwise. For the purposes of the second element, a defendant who has not actively induced the plaintiff to adopt an assumption or expectation will nevertheless be held to have done so if the assumption or expectation can be fulfilled only by a transfer of the defendant's property, a diminution of his rights or an increase in his obligations and he, knowing that the plaintiff's reliance on the assumption or expectation may cause detriment to the plaintiff if it is not fulfilled, fails to deny to the plaintiff the correctness of the assumption or expectation on which the plaintiff is conducting his affairs.’
21 On behalf of the respondents, it was contended that the third, fourth and fifth of those requirements had not been made out in respect of Mr Duncan. He had not acted, or refrained from acting, on the assumption that he had an “A” rating. Nor had he shown that SPC knew or intended that he should act on that assumption. Finally, Mr Duncan had not been shown to have suffered any detriment as a result of the assumption that he possessed an “A” rating not having been fulfilled.
22 An independent argument advanced on behalf of SPC in relation to Mr Duncan was that if, contrary to its principal argument, Mr Ottrey, as Human Resources Manager, had the power to change a rating from “B” to “A” “by the stroke of a pen” then Mr Bertolus, as his successor, could equally easily reverse the effect of Ottrey’s action.
23 It was also contended on behalf of SPC that cl 15.5 of the Shepparton Agreement attached no consequences to the possession of an “A” rating in the event that a selection had to be made between two former employees each holding an “A” rating or between a former employee holding an “A” rating and an applicant with no prior history of employment who, consequently, held no rating at all. Because Mr Maskell had made a selection for the ensuing 2004 season from a cohort of former employees who all held “A” ratings, Mr Duncan could not have complained of his non-selection even if he had been regarded as having held an “A” rating.
24 Against the possibility that all its exculpatory arguments might be rejected, SPC contended that any contravention of cl 15.5.5 which could be found to have occurred was a merely technical breach arising out of the same course of conduct and ought, accordingly, to be treated as a single breach for the purposes of s 178(2) of the Act.
Reasoning
25 I do not accept that, on the proper interpretation of the Shepparton Agreement, the rating assigned to a seasonal employee during, or at the end of, a particular season cannot afterwards be changed. In my view, the practice recognised in cl 6 of the 1987 Agreement clearly contemplates that a grievance by a former employee about the rating or grading which he or she had been allocated may be resolved by invocation of the agreed disputes procedure and, if necessary, that resolution may occur during the “off season” after which the employee is to be advised of his or her “final grading.” This view is also consistent with cl 7 of the Shepparton Agreement which was substantially identical with cl 7 of the Ardmona Agreement reproduced at [44] below. That clause provided for an ascending hierarchy of steps for the resolution of “any grievance of concern to an employee” (emphasis added). The first step involved “constructive discussion” between the employee and his or her immediate supervisor. The available steps then progressed from reference to the relevant departmental manager and shop steward through a review by the State Secretary (or appointed representative) of the Union and Senior Management on site to a reference to a mutually acceptable independent mediator or arbitrator and, in default of agreement on such a person, to the Australian Industrial Relations Commission (“the Commission”) by means of notification of a dispute. There is nothing to suggest that the procedure laid down by cl 7 was inapplicable to a grievance which a seasonal employee harboured about the allocation to him or her under cl 15.5.1 of a grading less than “A”. Since it was highly unlikely that the whole procedure ordained by cl 7 could be completed between the allocation of the original grading and the end of the season to which it referred, it follows that a change could have been effected to such a grading at any time or, at least, before recruitment was completed for the next season.
‘It is trite that narrow or pedantic approaches to the interpretation of an award are misplaced. The search is for the meaning intended by the framer(s) of the document, bearing in mind that such framer(s) were likely of a practical bent of mind: they may well have been more concerned with expressing an intention in ways likely to have been understood in the context of the relevant industry and industrial relations environment than with legal niceties or jargon. Thus, for example, it is justifiable to read the award to give effect to its evident purposes, having regard to such context, despite mere inconsistencies or infelicities of expression which might tend to some other reading. And meanings which avoid inconvenience or injustice may reasonably be strained for. For reasons such as these, expressions which have been held in the case of other instruments to have been used to mean particular things may sensibly and properly be held to mean something else in the document at hand.
But the task remains one of interpreting a document produced by another or others. A court is not free to give effect to some anteriorly derived notion of what would be fair or just, regardless of what has been written into the award. Deciding what an existing award means is a process quite different from deciding, as an arbitral body does, what might fairly be put into an award. So, for example, ordinary or well-understood words are in general to be accorded their ordinary or usual meaning.’
28 This construction does not detract, I consider, from the commonsense expectation articulated by Counsel for the respondents that the original assessment or allocation of an “A”, “B” or “C” grading would be made by the foreman, leading hand or other “line supervisor” of the employee concerned as a “persona designata”.
29 I have also concluded, for reasons similar to those outlined at [25]-[26] above, that rigid adherence to the formal mechanisms involved at a given stage of the settlement of disputes procedure is not necessary to give rise to an effective agreement to change the grading of a particular seasonal employee or former employee. In other words, appropriately authorised representatives of the Union and SPC could have informally agreed on a resolution of a dispute about grading even though their deliberations did not fit squarely within the description of one or other of the stages noted at [25] of these reasons. That, I find, is what happened at or immediately after the meeting of 29 May 2003 when Mr Ottrey had actual or ostensible authority to represent SPC and to make on its behalf any commitment necessary to resolve the dispute.
30 I regard the issue of whether Mr Duncan held an “A” grading when the selection of seasonal employees for the 2004 as essentially one of fact to be resolved in light of the interpretation of cl 15.5.1 which I have already discussed. Doctrines of estoppel bear on the resolution of that question only in the sense used by Brennan J in Waltons Stores at 415 where his Honour noted that “It has been said that estoppel in pais is merely a rule of evidence and not a cause of action.”
31 To apply the doctrine in that way is not to countenance either party’s contracting out of the Shepparton Agreement. All it does is to impose an evidentiary constraint on the proof of a matter relevant to the application of the Shepparton Agreement according to its terms. By contrast, resort to estoppel to deny one party a benefit prescribed by an award or agreement, or to deflect from another party a liability imposed by an award or agreement would be “unconscientious” in the sense discussed in this context by Lee and Carr JJ in their joint judgment in Metropolitan Health Services Board v Australian Nursing Federation (supra)at 113 [59]-[60]. As Dixon J observed in Thompson v Palmer (1933) 49 CLR 507, at 547;
‘The object of estoppel in pais is to prevent an unjust departure by one person from an assumption adopted by another as the basis of some act or omission which, unless the assumption be adhered to, would operate to that other's detriment. Whether a departure by a party from the assumption should be considered unjust and inadmissible depends on the part taken by him in occasioning its adoption by the other party. He may be required to abide by the assumption because it formed the conventional basis upon which the parties entered into contractual or other mutual relations, such as bailment; or because he has exercised against the other party rights which would exist only if the assumption were correct, as in Yorkshire Insurance Co. v. Craine (1922) 2 A.C. 541, at pp.546-547; cp. Cave v. Mills (1862) 7 H. & N. 913, at pp. 927-928; 158 E.R. 740 , at pp. 746-747; Smith v. Baker (1873) L.R. 8 C.P. 350, at p.357; Verschures Creameries Ltd. v. Hull and Netherlands Steamship Co. (1921) 2 K.B. 608, at p. 612; and Ambu Nair v. Kelu Nair (1933) 60 I.A. 266, at p.271; or because knowing the mistake the other laboured under, he refrained from correcting him when it was his duty to do so; or because his imprudence, where care was required of him, was a proximate cause of the other party's adopting and acting upon the faith of the assumption; or because he directly made representations upon which the other party founded the assumption. But, in each case, he is not bound to adhere to the assumption unless, as a result of adopting it as the basis of action or inaction, the other party will have placed himself in a position of material disadvantage if departure from the assumption be permitted.’
32 In the present case SPC, through Mr Ottrey and Ms Bennett, directly made representations upon which the Union and Mr Duncan founded an assumption that the latter’s grading had been changed from a “B” to an “A”. They acted upon that assumption by ceasing to press for a resolution of the dispute to which the original allocation of a “B” had given rise, and by Mr Duncan’s presenting for selection for the 2004 season in the belief that he would be accorded the priority or preference attaching to the holder of an “A” grading.
33 I am further satisfied that SPC, through Mr Ottrey and Ms Bennett, knew or intended that the Union and Mr Duncan should act in the ways just described on the representations made at the meeting on 29 May 2003 and contained in the letter of the same date.
34 It follows that SPC is estopped from denying that Mr Duncan was, after 29 May 2003, the holder of an “A” grading. In that sense the doctrine is applied as an exclusionary rule of evidence preventing SPC from establishing one fact relevant to its defence to the present prosecution. It does not operate to permit either party to the Shepparton Agreement to “contract out” of that agreement or to deny its application according to its terms to the relevant facts proved by admissible evidence.
35 The interpretation which I have placed on the events of 29 May 2003 also precludes SPC from relying on the notion that Mr Bertolus was able to change Mr Duncan’s grading back from an “A” to a “B” “by the stroke of a pen”. Implicit in the assumptions which Ottrey’s representation induced was that the substituted “A” grading would remain operative at least until the selection of seasonal employees for the 2004 season had been completed.
36 It is true that, since all the seasonal workers for the 2004 season selected by Mr Maskell in the area for which Mr Duncan was qualified for appointment also held “A” gradings, the substituted “A” grading would not have guaranteed Mr Duncan selection for that season.
37 However, SPC’s refusal to recognise him as possessing the substituted “A” grading meant that he lost the chance of being considered for selection on an equal footing with other applicants holding a similar grading. It is unnecessary to try to measure the value of that loss of a chance in monetary terms because there has been no suggestion that the breach which I have found gave rise to a requirement on SPC to pay any amount to Mr Duncan under the Shepparton Agreement.
38 I regard the breach which occurred when Mr Duncan was treated for the 2004 season as the holder of a “B” grading, as a single breach occurring once and for all, or, at worst, as arising out of a course of conduct within s 178(2) of the Act. The breach was at the lower end of the spectrum of breaches of certified agreements indicated by the maximum penalty of 300 penalty units for a body corporate stipulated by s 178(4)(a)(iib) of the Act. I consider that it resulted primarily from a breakdown of communication including that between SPC and the Union, which was a consequence of the transfer of responsibility for human resources from Mr Ottrey to Mr Bertolus. I am not persuaded that it reflected a high-handed determination by the latter to set at naught the agreement which had been reached on 29 May 2003. In view of SPC’s good record, as attested by the absence of any prior convictions, I shall impose a penalty of four penalty units or $440.
Alleged breach of cl 7.3(vii) of the Ardmona Agreement affecting Mr James
39 Mr James has been employed as a forklift driver by Ardmona and later SPC for almost thirty years. For many of those years, he worked on afternoon shift but, early in May 2004, he was told by his supervisor, Mr Snow, that he was required to work on day shift because there was nobody else available to do it. Mr James tried to suggest that there were four other workers who could be transferred and indicated that he would not, and could not, be compelled to go on to day shift. A few days later, Mr Snow tried to hand Mr James a piece of paper and repeated that he (James) was required to go on to day shift. Mr James refused to accept the paper and again insisted that he could not be compelled to go on to day shift. According to Mr James, Mr Snow then screwed up the paper and put it in his pocket.
40 Later, on 12 May 2004, Mr Campbell telephoned Mr Bertolus who by then had succeeded Mr Ottrey as Human Resources Manager for SPC and advised him that the Union intended to invoke the Grievance and Dispute Resolution Procedure in cl 7 of the Ardmona Agreement in relation to the transfer of Mr James from afternoon to day shift. That advice was confirmed by correspondence from the Union to which Mr Bertolus replied in these terms in a letter to Mr Campbell of 13 May 2004;
‘In respect of your request for confirmation of the process by which this matter is to be resolved, it is clear that the process detailed in the current Agreement is the only one open if you intend to place this matter in dispute. It is our understanding the matter is in dispute.
You are aware that the matter you raise was initially set in train on the 7th of this month when Mr. James was handed a notice, in accordance with the provisions of the certified agreement, requiring him to change his hours of work from the current arrangements to 7am to 3.30 pm.
It is our understanding that this is the correct process for notification.
I am instructed that Mr. James was selected for transfer for the following reasons:
1. The area in which he works will be shut down on afternoon shift due to lack of available work
2. That all operators in the adjacent areas were asked about their capacity to transfer and all refused to transfer on the basis of hardship.
3. The selection process for transfer was made on the basis of skills required for the day shift. Mr. James has the requisite skills.
I have noted the period of time that Mr. James has worked in this position and that the shift from afternoon to night shift would not allow Mr. James to claim the shift allowance for that shift.
Nevertheless there will be no work available for Mr. James in the area due to the manner in which the organisation has chosen to conduct its production arrangements into the foreseeable future due to adverse seasonal conditions and changed production arrangements. Furthermore the organisation has a position available on the day shift that will utilise his skills.
As I pointed out today, it is the Company's belief that Mr. James is the most suited to the transfer and the reasons put by you do not appear adequate to overcome that belief.
I have acceded, as part of the dispute resolution process, to your request to a meeting between a representative of the Union and myself as the representative of Senior Management. The intent of the meeting is to try to identify settlement options. The meeting is scheduled for 3 pm Friday the 14th of May 2004.’
41 A meeting was then arranged which was held at the Shepparton site on 14 May 2004. It was attended by Mr James, Mr Campbell, Mr Hale, another officer of the Union, and Mr Bertolus. According to Mr James, Mr Bertolus became agitated and insisted that unless he (James) were to report for work at the commencement of the day shift on the following Monday, 17 May 2004, he would be regarded as having abandoned his employment. Mr Campbell disputed that contention and the meeting then ended.
42 At the time fixed for commencement of the afternoon shift on 17 May 2004, Mr James attended at the Shepparton site accompanied by Mr Campbell but was told by Mr Bertolus, who was accompanied by Mr Rogers, the warehouse supervisor who was Mr Snow’s immediate superior, that his (James’) work was on day shift. By not reporting for work at the commencement of the shift, Mr Bertolus said, James had abandoned his employment. Mr James disputed that contention and insisted that he worked on afternoon shift, that it was not an afternoon shift and there was no more work there. Upon being requested to leave the premises, Mr James and Mr Campbell then departed.
43 About two and a half weeks later, a meeting occurred between Mr James, Mr Campbell and Mr Schubert, who was the General Manager for SPC. Mr Schubert then said that the whole incident had been unfortunate and that, on the following Wednesday, James could return to his old job on afternoon shift. After Mr James recommenced work, Mr Rogers apologised for what he had said on 17 May 2004. Thereafter, SPC reimbursed Mr James at the rate applicable for afternoon shift for the time lost between 17 May 2004 and his return to that shift.
44 Clause 7 of the Ardmona Agreement was in these terms;
‘7. GRIEVANCE AND DISPUTE RESOLUTION PROCEDURE
7.1 Ardmona Foods Limited and its employees recognise that the need for continuous processing without unnecessary and avoidable interruption, will be critical to the success of the enterprise and of future job security and reward.
7.2 All parties commit themselves in good faith and trust, to the successful re-solution of grievances and disputes through the following procedure.
7.3(i) Any grievance of concern to an employee will be the subject of constructive discussion between that employee and his or her immediate Supervisor. The Supervisor will attempt to resolve the matter speedily and equitably.
(ii) In the absence of a mutually acceptable resolution, the dispute will then be referred to the relevant Department Manager and Shop Steward for resolution.
(iii) Should the matter remain unresolved the State Secretary or appointed representative of the union and Senior Management on site will review jointly the merits of the dispute and identify settlement options.
(iv) If (i) and (11) [sic] are unsuccessful, the parties may refer the matter to an independent mediator or arbitrator acceptable to the parties, otherwise a dispute may be notified with the Australian Indus=trial Relations Commission.
(v) At each stage of the dispute process an employee has the choice to involve an appropriate union shop steward or delegate.
(vi) Without prejudice to each party, work shall continue in accordance with the agreement while the matter in dispute is dealt with.
(vii) In order to allow for the peaceful resolution of grievances the parties will continue with normal operations while this process is being followed and the - status quo as existed immediately before the dispute will remain while the dispute is being resolved.
(viii) The parties commit to adhere to this procedure and make every effort to minimise resolution time frames.’
45 As in force in May 2004, cl 26.6 of the Food Preservers’ Interim Award 1986 (“the Food Preservers’ Award”) to which the Union and Ardmona were both parties, stipulated;
‘26.6 Shift transfers
An employee on afternoon or night shift may be transferred to day work, day shift or another shift on at least 48 hours notice by the employer. Where such an employee is so transferred without at least 48 hours notice any day or shift or part thereof worked without that notice shall, for the purpose of this clause, be deemed to be part of the ordinary 38 hours of work. Such work shall be paid for at an extra half rate for the first three hours and an extra full rate thereafter on a daily basis in addition to the employee's ordinary rate of pay and shift penalties, if applicable. Provided that this subclause shall not apply where, with the consent of the employer, an employee agrees with another employee independently to exchange a rostered shift to suit the mutual convenience of the employees concerned.’
Submissions on behalf of Ardmona
46 In relation to Mr James, Counsel for Ardmona submitted that cl 26.6 of the Food Preservers’ Award entitled Ardmona to transfer an employee from one shift to another on 48 hours notice. Clause 7.3.1 should be read as recognising the existence of that entitlement. If, contrary to that principal submission, the disputes procedure were held to apply in respect of the transfer of Mr James to day shift, by the time when the procedure was invoked his employment on day shift constituted the status quo. That entailed that Mr James was required to continue working on day shift until the disputes procedure had been fully implemented. As a variant of this alternative submission, it was contended that, on the proper construction of cl 7.3(vii), Mr James was obliged to work as directed on day shift in accordance with the Ardmona Agreement without prejudice to his claim while it was being processed in accordance with the dispute resolution procedure.
47 Finally, it was urged that since the dispute had eventually been resolved amicably and to Mr James’ satisfaction, any breach by Ardmona of the Ardmona Agreement was purely technical in character.
Submissions on behalf of the Union
48 Mr Terzic for the Union contended that, once the settlement of disputes procedure had been invoked, Ardmona’s discretion to implement shift changes in accordance with cl 26.6 of the Food Preservers’ Award was “frozen” until the dispute had been resolved or the process for resolving it had been exhausted. It was said that, to the extent of any inconsistency, cl 7.3(vii) of the Ardmona Agreement prevailed over the Food Preservers Award. That, it was submitted, was the effect of sub-cll 6.1 and 6.2 of the Ardmona Agreement which provided:
‘6.1 This Agreement shall be read wholly in conjunction with the Food Preservers’ Award 2000, provided that where there is any inconsistency between this Agreement and the above named Award, this Agreement shall take precedence to the extent of any inconsistency.
6.2 However, the parties to this Agreement shall maintain all rights and entitlements contained within the Food Preservers’ Interim Award 1986 (except Clause 36) as it stood on 1st May 1996 provided that where there is an inconsistency between the Food Preservers Interim Award 1986, and Agreements, this Agreement shall take precedence to the extent to any inconsistency.’
49 The same effect was said to be achieved by s 170LY(1) of the Act which provided:
‘While a certified agreement is in operation:
(a) subject to this section, it prevails over an award or order of the Commission, to the extent of any inconsistency with the award or order; and
(b) it has no effect to the extent of any inconsistency with another agreement certified before it, whose nominal expiry date has not passed.’
‘[14] As to the contention that the removal of the long prong fork lifts after the risk assessment process had been carried out was contrary to clause 7.3(vii) of the Agreement, the AMWU contends that the relevant status quo was the situation that pertained immediately prior to the dispute arising, namely that the relevant work would be performed by persons employed as and operating long prong fork lifts. On the other hand, the employer contends that the relevant status quo is that which existed immediately prior to the dispute notification, namely the work being performed without the use of long prong fork lifts.
[15] As a matter of construction of the Agreement, I must concur with the AMWU’s submission. The relevant dispute was always about the performance of the relevant work, i.e. whether or nor it should continue to be done with long prong fork lifts. Whilst that dispute continued and was the subject of the application of the disputes resolution clause, the employer was obliged, in my view, by Clause 7.3(vii) to continue to have the work performed in the manner in which it was being performed before the dispute arose. An employer cannot arbitrarily alter the status quo. Notwithstanding any health and safety issues, the employer was obliged to comply with the Agreement. It has failed to do so. It was, in my opinion, obliged by the Agreement to continue to carry out the work in the manner in which it was so doing prior to February 2002 until the dispute was finally resolved in accordance with Clause 7.3.’
51 According to Mr Terzic, the “status quo” for the purposes of cl 7.3(vii) was the situation which obtained immediately before the dispute arose. That occurred, he contended, at the moment when Mr James was given notice of a change to a shift that was unacceptable to him. The breach of cl 3(vii) was said to be constituted by Ardmona’s insistence on Mr James working a shift different from that worked during the presumptive “status quo”.
Reasoning
52 In my view, the key to this part of the Union’s claim is to be found in the expression “normal operations” in cl 7.3. In its context in a clause construed in accordance with the principles outlined at[26]-[27] above it signifies that work will continue without any exceptional or unusual action on either side; see eg Peak Trailer & Chassis v Jackson [1967] 1 WLR 155. In the case discussed at [50] above, the withdrawal of the long prong forklift drivers from an area in which they had usually been employed was not normal in this sense. On the other hand, the susceptibility of employees to work different shifts at the direction of Ardmona was, I consider, a normal incident of employment as recognised by cl 26.6 of the Food Preservers’ Award. It did not cease to be “normal”, in the meaning I have accorded to the word, upon a particular employee’s protesting about a specific direction.
53 I am reinforced in this conclusion by the consideration that the contrary construction would allow an individual employee, by protesting against a permissible direction of the employer, to compel the employer to preserve in minute detail the entire pre-direction working environment of that employee until, possibly, the whole dispute resolution process described at [25] above had been exhausted upon the making of a decision or recommendation by the Commission.
54 Even if the construction of cl 7.3 which I favour be wrong, I would decline, in the exercise of the discretion conferred by s 178 of the Act to impose a penalty on Ardmona in respect of its conduct in relation to Mr James. That is because the Union and Mr James effectively availed themselves of the dispute settlement mechanism provided by cl 7 by procuring his transfer back to afternoon shift without any loss of remuneration.
55 For the reasons which I have endeavoured to explain that part of the application which seeks the imposition of a penalty on Ardmona in relation to Mr James will be dismissed.
Conclusion
56 As I have already indicated, a penalty of $440 will be imposed on SPC for the breach of cl 15 of the Shepparton Agreement in respect of Mr Duncan. I shall order that the amount of that penalty be paid to the Union. In light of my conclusion on the claim for a penalty in relation to Mr James, the application will otherwise be dismissed.
|
I certify that the preceding fifty-six (56) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Ryan. |
Associate:
Dated: 11 August 2006
|
Mr B Terzic of the Australian Miscellaneous Workers’ Union appeared on behalf of the Applicant. |
|
|
Counsel for the Respondents: |
Dr C Jessup QC with Mr P Wheelahan |
|
Solicitor for the Respondents: |
Allens Arthur Robinson |
|
Dates of Hearing: |
19, 20 and 21 July 2005 |
|
Date of filing of written submissions by the Applicant: |
4 August 2005. |
|
Date of Judgment: |
11 August 2006 |
