FEDERAL COURT OF AUSTRALIA

National Union of Workers v Qantas Airways Ltd [2013] FCA 976

THE COURT ORDERS THAT:

1.    The application be dismissed.

2.    The parties have liberty to make an application for costs within 21 days.

3.    Should no application be made under order 2 above, there be no order as to costs.

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

REASONS FOR JUDGMENT

1.    The applicant (‘the NUW’) seeks declaratory relief against Qantas Airways Ltd (‘Qantas’). The application is made under the provisions of the Fair Work Act 2009 (Cth) (‘the FW Act’) and is made with the object of determining the relevant industrial agreement or agreements to apply to the employment of certain persons who are engaged at the Sydney Freight Terminal (‘the SFT’) located at Kingsford Smith Airport, Sydney. The relief sought is as follows:

1.    A Declaration pursuant to section 21 of the Federal Court Act 1976 (Cth) that the Qantas Airways Limited (National Union of Workers) Enterprise Agreement 9 applies to the employment of persons engaged by the respondent in the classification of Airline Services Operator, at the Sydney Freight Terminal engaged in freight operations on or after 10 October 2012.

2.    A Declaration pursuant to section 21 of the Federal Court Act 1976 (Cth) that the Enterprise Agreement named in order 1 shall continue to apply to the employment of those persons referred to in order 1 whilst that Enterprise Agreement remains in force pursuant to section 52 of the Fair Work Act 2009 (Cth).

BACKGROUND

2.    Qantas Freight, a division of Qantas, is a cargo terminal operator which has operations in Sydney (namely at the SFT), Melbourne, Brisbane, Perth and Los Angeles. Following a recent merger between Qantas Freight and Australian air Express, Qantas Freight now also operates in Adelaide.

3.    The SFT is made up of three airport freight handling facilities at Sydney, namely an on-airport facility which processes international air freight (‘SFT1’); the Express Handling Unit (‘EHU’) which is a dedicated express facility located adjacent to the SFT1 and which processes express international air freight; and the Mail Handling Unit (‘MHU’) which is similarly located and which processes international mail. The area between the ramp and the SFT1 is generally known as the ULD transfer area.

4.    Two other cargo terminal operators are located at Sydney airport. One is Menzies International Cargo Terminal which is located at the Sydney domestic airport approximately 1.85 km from the SFT1. The other operator is Toll Dnata, with its International Cargo Terminal which is located only 125 metres from the SFT1.

5.    Qantas Freight handles all of the incoming and outgoing freight for all international Qantas flights, Jetstar and Jetstar Asia aircraft. It also manages a fleet of four Boeing 747-400F and one B767-300F freighter aircraft which provide international services. Qantas freight also provides a freight service on behalf of third party airlines.

6.    Prior to October 2012, the terms and conditions of the employment of persons engaged at the SFT1 were governed by the Qantas Airways Limited (National Union of Workers) Enterprise Agreement 9 (‘the NUW EBA’). The persons whose employment was governed by the NUW EBA undertook duties in and around the SFT1 which included receipt, dispatch and storage of loose freight, and the handling of all freight containers entering into or leaving the SFT1. The NUW EBA 9 did not apply to persons engaged in the MHU and the EHU. Their employment conditions were regulated under a TWU industrial instrument.

7.    Qantas claims, and it does not appear to be seriously disputed, that employees at the SFT1 would, as part of their work governed by the NUW EBA, transfer freight which had been processed to a variable area in the ULD transfer area for collection by employees whose work was covered by TWU conditions. The Court will refer to this area as the ‘SFT freight collection/deposit area’. Such freight would then be transported by other employees whose work was covered by TWU conditions to ‘the ramp’ for loading on aircraft. The reverse procedure would apply to freight being imported. The ‘ramp’ or ‘freighter ramp’ is a part of the airport used, inter alia, for the purpose of enabling loading and unloading freight or baggage, and where aircraft are parked. ‘Ramp work’ includes the handling of freight on the ramp.

8.    Qantas submits that the SFT freight collection/deposit area, known by Qantas as the ‘white line’, constituted a notional demarcation, in that employees under the NUW EBA were not to undertake any work beyond the ‘white line’ such as ramp work. The NUW vehemently denies the existence of a ‘white line’ and the assertion that employees covered by the NUW EBA were not supposed to work beyond the SFT freight deposit/collection area. The NUW acknowledges however that in practice freight was usually deposited or collected by employees in such an area.

9.    Qantas claimed that such ‘double handling’ was inefficient. From 1 October 2012 to 31 December 2012 Qantas’ records show that approximately a third of the arrival times for freighter aircraft and a similar proportion of departure times were not in accordance with their schedule. As a result, Qantas Freight encountered difficulty in obtaining sufficient crew to perform the duties of loading and unloading aircraft. Further, management and employees of Qantas Airports (a division of Qantas) who were engaged in loading freight from Atlas and Fedex freighter aircraft were directed to prioritising passenger ground handling instead of freighter ground handling. This resulted from the fact that these employees were not under the control of Qantas Freight. Due to these difficulties, and the demarcations in the handling of freight, Qantas determined that the existing system of freight operations could not continue. The inefficiency was found to lie in part in the fact that SFT1 employees did not undertake transhipment duties (as defined in [11] below) nor ramp duties whilst undertaking work in and around the SFT1.

10.    On or about 18 July 2012 Qantas announced a restructure for its employees engaged in the SFT. The restructure was announced by letter from Qantas, signed by Mr Bob Lugton, Head of Operations, on 18 July 2012 which was accompanied by an information sheet describing the purpose of the restructure. A presentation to Qantas employees provided information that the existing operations of transhipping goods from the SFT1 to the ramp and then from the ramp to aircraft, would henceforth become a single operation.

11.    Transhipment duties relevantly include:

(a)    The transportation of inbound international freight from overseas destinations that is bound for other domestic cities in Australia. Such transportation occurs from a SFT freight collection/deposit area to the domestic terminal to be loaded onto aircraft;

(b)    The transportation of outbound international freight arriving in Sydney from other domestic cities in Australia that is bound for overseas destinations from the domestic terminal to a SFT freight collection/deposit area; and

(c)    Transportation between cargo terminal operators, such as Menzies and Toll.

12.    Freight may arrive at the SFT in four separate ways, namely:

(a)    Unitised cargo container: this term is used to describe ‘containerised cargo’. It may be one or more smaller individual shipments sent under the same airway bill. Such container is also described as a Unit Load Device (‘ULD’);

(b)    Loose items of freight;

(c)    Outbound Australia Post international mail or parcels;

(d)    Outbound express international freight. Such freight may be unitised or loose and is handled in the EHU.

13.    The restructure was implemented in late July 2012 following the delivery of an extensive information program to employees who were to be affected by the reforms. Under the restructure approximately 20 positions within SFT1 under the NUW EBA were made redundant. The employees occupying those positions were offered the opportunity to apply for employment under the Qantas Airways Limited and QCatering Limited – Transport Workers Workplace Determination (‘the TWU Determination’), including as an Air Services Operator, Level 4, SFT (Freight Operation) (‘ASO 4’), or accept a retrenchment package. All except two of the employees being made redundant accepted the retrenchment package.

14.    It appears that 27 employees (not being the persons referred to immediately above except for two) previously employed under the NUW EBA successfully applied for ASO 4 positions. There is no evidence that any applicant was refused engagement as an ASO 4. The Court has been informed that due to subsequent resignations, approximately 25 of those 27 workers remain engaged in that capacity. These workers will be referred to hereunder as the ‘re-engaged employees’. In addition, 25 employees in the MHU and EHU were already employed in the category of ASO 4, and other employees who were previously engaged by other freight operators at Sydney Airport have joined Qantas Freight in the category of ASO 4. The result is that at the time of the hearing there were approximately 67 employees in that category.

15.    The NUW contends that employees engaged at the SFT1 prior to the restructure were at all times able to engage in ramp and transhipment duties pursuant to the NUW EBA. Further, the NUW submits that the duties of such employees have not changed since the restructure, but are substantially identical to the duties previously performed under the NUW EBA. That is, there has been little or no change in the work performed by the employees since the restructure.

16.    Qantas submits that all those employees who have accepted new employment conditions as an ASO 4 are performing, or when training is completed, will be performing a wider range of duties that never formed part of the duties covered by the NUW EBA, and are subject to the TWU Determination. However, those who perform work solely within the SFT and are not engaged in ramp work remain covered by the NUW EBA.

17.    The parties have formulated the following issues for determination in this proceeding:

1.    Does the NUW EBA (and in particular the classification structure therein) cover the duties being performed by the 27 employees who transferred across to an ASO 4 position in or about October 2012, in their employment as at the date of the hearing?

2.    What industrial instrument (either the TWU Determination or the NUW EBA) applies to the duties required to be performed by the employees of the respondent following the restructure which was announced by the respondent on 18 July 2012 who are managed by Qantas Freight and engaged in the position of Airline Services Operator?

3.    If one or more industrial instruments are found as being capable of applying to the employment of the transferred employees, how does the Court reconcile that potential conflict, in a manner consistent with the FW Act?

4.    Are there any other discretionary reasons for refusing the relief sought by the NUW if it otherwise makes out its case?

18.    Central to these issues is the identification of the duties covered under each of the NUW EBA and the TWU Determination. In considering the application of both the NUW EBA and the TWU Determination, the Court will have regard to the work performed by the re-engaged employees after the restructure. In interpreting both the NUW EBA and the TWU Determination the Court will apply the established principles of interpretation which require it to construe the terms of the respective instruments according to their ordinary and usual meaning whilst avoiding an interpretation that would lead to capricious or unreasonable consequences: Amcor v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241 at 270-271 and 282-283; Kucks v CSR Limited (1996) 66 IR 182 at 184 (‘Kucks’); TCN Channel 9 Pty Ltd v Hayden Enterprises Pty Ltd (1989) 16 NSWLR 130 at 146; Australian Broadcasting Commission v Australasian Performing Rights Association Ltd (1973) 129 CLR 99 at 109-110.

FACTS

19.    The Court held a view of the SFT. The SFT1 comprises a substantial building located inside the Sydney airport tarmac containing offices, a large warehouse for the handling of freight, and a tarmac curtilage.

20.    Containerised freight for overseas destinations arrives at the SFT in ULDs and may be exported without being handled by storepersons within the warehouse area. Such freight is moved directly to the ‘export bypass area’ in the ULD transfer area and is received into the SFT1. The ULDs are offloaded from trucks by a Transfer Vehicle (‘TV’) known as Alpha, and moved to temporary storage or to an area in the ULD transfer area adjacent to the Tarmac 1 TV for dispatch to aircraft within four hours. All ULDs are eventually moved to Tarmac 1 for dispatch.

21.    A TV on Tarmac 1 is used to connect freight for export to a tug. Such a tug is operated by an employee covered by the NUW EBA to transport the ULDs to the SFT freight collection/deposit area (i.e. the area referred to by Qantas as the ‘white line’). From this location, freight, prior to the restructure, would be collected for placement in the aircraft by other staff whose employment was governed by TWU conditions.

22.    Another TV on Tarmac 2, and sometimes a TV on Tarmac 3, is used to convey imported freight from outside the SFT1 building to its interior where it would be processed. An area known as the Import Bypass Area, with the Nobby TV therein, allows freight to bypass the warehouse and be delivered directly to customers’ trucks.

23.    Where loose freight is to be exported, it is brought to the SFT where the goods are assembled on pallets into ULDs which are then transported to the aircraft. The process of building up such a ULD is known as ‘export build-up’. When a ULD has been built-up, it is transferred within the SFT1 by a TV known as Delta to an Elevated Transport Vehicle (‘ETV’) known as Bravo. An ETV operates in much the same way as a TV, but can lift ULDs to a greater height. The Bravo TV then transports the ULD to a mezzanine area for storage or onto Tarmac 1 to later be transported for loading onto aircraft as per [21] above. Export build-up duties remain unaffected by the restructure. That is, such duties are still undertaken by employees covered by the NUW EBA after the restructure.

24.    Inbound and outbound Australia Post international mail is handled in the MHU. Mail is processed inside the MHU according to the flight and placed in containers ready for transportation. It is then moved out to the aircraft.

25.    Inbound and outbound express international freight is handled in the EHU. Such freight may arrive loose or in a ULD. If the freight is in a ULD, the freight is transported to an SFT freight collection/deposit area where it is deposited for onward movement. Loose freight arriving at the EHU is processed inside that unit, then loaded onto containers which are similarly transported out to a place for collection.

EVIDENCE

NUW Witnesses

26.    The NUW primarily relied on the evidence of three employees, each of whom were employed pursuant to the NUW EBA but accepted ASO 4 positions following the announcement of the restructure, namely John Philip Preston, Glen Alan Scott and James Moanaroa Ranui. Paul Richardson, the Assistant National Secretary of the NUW, also testified.

27.    Mr Preston was classified as a level 4 storeperson under the NUW EBA from 1997 until 2012 when he accepted an ASO 4 position under the TWU Determination. Mr Preston states that he was informed by Mr Lugton that Qantas ramp staff would continue to transfer freight to the aircraft at the international terminal after the restructure and that there would be no area designated for the ‘drop off and pick up of freight’. Mr Preston states that he did not wish to take the voluntary redundancy that was offered, and accordingly decided that he would apply for the position of an ASO 4.

28.    Mr Preston stated that amongst his former duties he would ‘tag-up’ inbound ULDs with stickers for identification and further transport instructions. He would also be required to drive a tug towing inbound freight from designated areas on the tarmac to the SFT1 where it would be pushed inside for import breakdown or to be held at Nobby. On occasions he would tow outbound freight from Tarmac 1 to a holding area on the ramp at the SFT.

29.    In the months immediately preceding Mr Preston being engaged as an ASO4, he was moved to the ULD storage area (near the Import Bypass Area). Mr Preston claims that following the restructure he continued to perform his previous duties in the ULD storage area. After redundancies at the SFT took effect he was transferred back to the work he had been performing on the tarmac, including tug driving and ‘tagging up’ inbound ULDs.

30.    Mr Preston said that he was not aware of the definition of a ‘white line’, but acknowledged that there were variable areas for the deposit or collection of freight. Mr Preston maintains that since the restructure, the system for handling freight has not changed. He states that ‘freight is still being moved from tarmac 1 [in the SFT] (for dispatch) to the drop area and a different person comes and picks up the profiles as needed for loading into the plane.’

31.    Mr Preston also stated that prior to restructure, NUW members would tug freight out to the aircraft from time-to-time. He also states that following training from 14 November 2012 to 27 November 2012 he has worked on approximately five freighter aircraft.

32.    Mr Scott had been employed at the SFT as a level 3 storeperson under the NUW EBA. He recalls a presentation being given on about 18 July 2012 when the restructure was announced. Mr Scott remembers a statement being made either by Mr Lugton or by Frank Ridolfo, Manager of the SFT, to the effect that all machine work, which he understood to include Alpha, Bravo, Charlie, Tarmacs 1, 2 and 3, and Nobby, was going to be allocated to staff under the TWU Determination in the future.

33.    Mr Scott applied for the position of ASO 4, and after being so appointed, remained working in the export section operating Bravo. He states that in late October or early November 2012 he undertook ramp training which involved the loading of freighter planes using a pallet loading machine (known as a ‘FMC’) and the use of a mobile conveyer belt. He states that the training took place over a three week period.

34.    Mr Scott said that following the training he was sent to work at Tarmac 1 to perform the same work which he had done prior to his appointment as an ASO 4 under the TWU Determination, namely working on the TVs pushing freight into the warehouse and removing freight from the export bypass area for delivery to the airport. The latter action involved moving freight onto a ‘spot on the tarmac where it would be picked up by other staff (ramp staff) for delivery to the aircraft’. He also returned to work on the Tarmac 3 TV pushing freight into the Import Bypass Area.

35.    Mr Scott said he had never heard of any reference to a ‘white line’. He states that on some occasions he handled mail and express products in the warehouse, although he recognised that they should have gone direct to the MHU or the EHU.

36.    Prior to the restructure, Mr Ranui was a level 3 storeman under the NUW EBA working in the SFT1. He recalled attending a presentation concerning the restructure and he applied for the position of an ASO 4. In November 2012, he was performing work in the Import Bypass Area when he was required to undertake training for about 10 days in respect of ramp functions. That training related to the loading and unloading of freighter aircraft, operation of the FMC and operating joysticks and switches in the aircraft hold to enable the movement of freight within the aircraft hold. Mr Ranui considered that the FMC performs the same function as Charlie or Bravo in the movement of ULDs.

37.    Mr Ranui stated that since undergoing the training he has been based in the Import Bypass Area, but for about one third of each day on average he performs loading and unloading duties on a 747 Atlas freighter aircraft. Since 19 December 2012, those duties have extended to loading and unloading Fedex freighter aircraft. He also stated that he is only aware of three employees who accepted the offer of employment to be an ASO 4 under the restructure who are now undertaking ramp duties.

38.    Mr Richardson, in his capacity as the Assistant National Secretary of the NUW, deposed to the history of the current NUW EBA by reference to previous versions of that award, and provided his understanding of the operation of the agreement. He stated that the declarations sought were designed ‘to protect members of the NUW who moved over to this new classification in October 2012 or persons who have subsequently joined us, performing that work’. He also stated that to the best of his knowledge there was minimal or no TWU membership amongst other persons performing ASO work.

39.    As to whether the so called ‘white line’ existed Mr Richardson stated:

… I would accept that there has been a broad division of labour as described, but this was not based on ‘white lines’, classifications in EBA’s or a refusal by NUW members to perform any particular work. Rather, it is the manner in which management has organized [sic] the work in the past.

Qantas Witnesses

40.    Qantas primarily relied on the evidence of two witnesses, namely Mr Ridolfo and Peter Edgar Smith, the Industrial Relations Manager of Qantas.

41.    Mr Ridolfo provided evidence of the operations conducted at the SFT and of the restructure. He also explained the process by which freight arrives at the SFT, namely that outbound freight arrives either in a ULD, as loose freight, as Australia Post international mail, or as express international freight. He said that inbound freight arrives predominantly in ULDs, but can also arrive as loose items from passenger aircraft.

42.    In his affidavit sworn 7 February 2013, Mr Ridolfo deposed:

The work after the Restructure

Following the Restructure, the range of work now required to be performed by employees managed by Qantas Freight includes:

(a)    freighter ramp handling;

(b)    transhipping;

(c)    work in the MHU;

(d)    work in the EHU;

(e)    freight transportation activates in the ULD transfer area; and

(f)    the handling of non-containerised freight, including the build-up and breakdown of freight inside the warehouse area.

43.    Mr Ridolfo states that the first four categories of activities listed immediately above were performed prior to the restructure by employees covered by the predecessor instrument to the TWU Determination. He agreed that freight transportation activities around the warehouse were previously undertaken by employees under the NUW EBA, but contended that some of those freight transportation activities were also covered by the TWU Determination.

44.    Mr Ridolfo stated that the role of ASOs was to encompass the activities listed at [42(a)]-[42(e)] above. Mr Ridolfo said that the restructure was necessary:

… to ensure the business was able to roster employees across each of the work groups identified [in [42(a)]-[42(e)] above] in order to achieve efficient gains through cross-utilisation.

45.    Mr Ridolfo further stated that the NUW EBA does not cover employees who perform work at any of Qantas’ other cargo terminals in Australia, that work being covered by the TWU Determination. As to the NUW EBA, Mr Ridolfo expressed his opinion that the words ‘in and around freight terminals’ as referred to in such agreement ‘means the area up to the white line and have not extended to the operation of the equipment referred to in the descriptors to load and unload freighter aircraft, which is on-airport work’.

46.    Mr Ridolfo also provided his understanding of certain phrases within the NUW EBA as follows:

(a)    ‘general handling of freight’ as used in relation to a storeperson level 1 refers to the handling of loose freight, mail and express products brought into the warehouse to be broken down;

(b)    ‘freight acceptance and dispatch airside’ as used in relation to a storeperson level 3 refers to the secure area of the airport not accessible to the public and for which employees need a special security access and authorisation. In the context of the SFT, ‘airside’ is said to mean the area where Tarmacs 1, 2 and 3 operate.

(c)    ‘freight assembly and aircraft pallet restraining’ as used in relation to a storeperson level 3 refers to the process by which the pallets are built up, but does not refer to restraining pallets on an aircraft.

47.    Mr Rildolfo states that Mr Preston has undertaken ramp duties since being re-engaged. Like other employees now engaged under the TWU Determination, upon the completion of relevant training Mr Preston will be cross-utilised to perform ramp duties, transhipping and freight transportation activities around the SFT1, as well as work in the MHU and EHU.

48.    Mr Ridolfo disagreed with Mr Ranui’s statement that the FMC performs basically the same function as Charlie or Bravo. Mr Ridolfo referred to the fact that the FMC is mobile, and an operator of the FMC must be skilled at positioning such equipment around an aircraft. In contrast, Charlie and Bravo operate on rails. Further, the operator of the FMC must also perform additional functions including aircraft door opening and closing, locking and unlocking ULDs and ensuring that ULDs are correctly positioned in the aircraft as per the load instruction report. Additionally an FMC operator must certify that the aircraft has been loaded in accordance with such report. Accordingly a higher degree of skill and training is required.

49.    Mr Smith stated that based on his experience as an Industrial Relations Manager with the responsibility, inter alia, for freight and airports, the words ‘in and around Freight Terminals’ operate as a geographical restraint on the operation of equipment referred to in the classification descriptors and that at the SFT, freight specific functions are performed in the warehouse area and in the immediate area up to the ‘white line’. Mr Smith stated the ‘white line is a term used to describe the physical location at which the NUW covered work stops, and the TWU covered “on airport” work starts’. He said that the work covered by the new category ASO 4 is ‘on-airport work’.

CONSIDERATION

50.    To address the relief sought by the NUW, the Court must undertake two tasks. The first is to establish the duties which are covered by each of the NUW EBA and by the TWU Determination. The second is to ascertain which duties are presently being undertaken by the re-engaged employees.

51.    It is necessary to consider the relevant statutory provisions relating to enterprise agreements and workplace determinations. Section 52 of the FW Act relevantly provides:

When an enterprise agreement applies to an employer, employee or employee organisation

When an enterprise agreement applies to an employee, employer or organisation

(1)     An enterprise agreement applies to an employee, employer or employee organisation if:

(a)     the agreement is in operation; and

(b)     the agreement covers the employee, employer or organisation; and

(c)     no other provision of this Act provides, or has the effect, that the agreement does not apply to the employee, employer or organisation.

…

52.    Section 277 of the FW Act, which operates with respect to workplace determinations, is expressed in similar terms:

Employers, employees and employee organisations covered by a workplace determination

Employers, employees and employee organisations

(1) A workplace determination covers an employer, employee or employee organisation if the determination is expressed to cover the employer, employee or employee organisation.

…

53.    The effect of such sections in respect of the present application may be put simply: the re-engaged employees will either be covered by the NUW EBA or the TWU Determination depending upon the duties they undertake. If the duties fall within the terms of the NUW EBA then the employee will be bound by that agreement. If however, the duties are more properly covered by the TWU Determination, then its terms will apply to the re-engaged employees.

54.    The FW Act readily resolves the issue of competing industrial instruments where two enterprise bargaining agreements apply to the same employment, or where a workplace determination and a subsequent enterprise bargaining agreement apply to the same employment. In relation to both scenarios, the subsequent enterprise bargaining agreement will apply (see ss 58 and 278 of the FW Act respectively). However the FW Act makes no provision for the situation in which an enterprise bargaining agreement and a subsequent workplace determination cover the same employment duties. This is presumably because a determination is only made when enterprise bargaining fails: see Pt 2-5 of the FW Act.

55.    The TWU Determination was made on 8 August 2012 following the termination of industrial action between, inter alia, Qantas Airways Limited and the TWU: Transport Workers’ Union of Australia v Qantas Airways Limited [2012] FWAFB 6612 at [1]. As the parties were unable to settle an enterprise agreement between them within 21 days following the termination, Fair Work Australia (‘FWA’) (as it then was) was required to make a workplace determination in accordance with s 266 of the FW Act.

56.    The NUW notes that s 267(4) of the FW Act requires that a workplace determination cover each employer and employee that would have been covered by the negotiated enterprise agreement had it been formed, together with any employee organisation that was a bargaining representative of the employees. In this context, the NUW emphasises the fact that the re-engaged employees participated in the approval of the NUW EBA, but were not involved in the industrial action preceding the TWU Determination and accordingly, were not involved in the hearing before Fair Work Australia that led to the TWU Determination. This is one of the reasons why the NUW contends that the NUW EBA applies to the re-engaged NUW employees.

57.    The Court rejects this submission. Section 267(4) contains a statement of those persons who must be included to be covered by a determination. In this way, it is a section directed toward the exercise of Fair Work Australia’s jurisdiction. Once a determination has been made however, s 277 is the operative section of the FW Act in respect of establishing which employees are covered by the determination. Employees so covered are those which the determination is expressed to cover: see [52] above. This does not preclude other persons who were not part of formation of a workplace determination from being covered should such determination be expressed to cover their duties.

58.     The NUW also raised other sections of the FW Act in support of its arguments. It submits that the NUW EBA could only cease to operate if it was terminated in accordance with ss 224 or 227, or if it was superseded by another enterprise agreement as per s 54. Such submission does not however address the primary submission of Qantas; namely that the duties of the re-engaged employees have changed so as to bring their work duties within the coverage of the TWU Determination, and that the roles and responsibilities of an employee under the TWU Determination are not the same as those covered by the NUW EBA. Further, the operation of ss 52 and 277 is, as was submitted by Qantas, such that:

An enterprise agreement is not an agreement to continue to employ persons for the term of the agreement. More so, it is an industrial instrument which determines the pay and conditions of persons when the coverage of the enterprise agreement extends to their current employment. If an employee’s duties change, to take them outside of the coverage clause of the agreement, the agreement ceases to apply [to that employee]. The principle is the same for workplace determinations.

59.    The same reasoning also applies to the contention of the NUW that an ‘agreed outcome’, being an enterprise agreement, should be preferred over an ‘imposed outcome’, being a workplace determination, in accordance with the objects of the FW Act. The relevant object in this context is contained in s 3(f), which states:

The object of this Act is to provide a balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians by:

…

(f)    achieving productivity and fairness through an emphasis on enterprise-level collective bargaining underpinned by simple good faith bargaining obligations and clear rules governing industrial action;

…

(Emphasis added)

60.    The fact that a workplace determination can only be made in limited circumstances, including relevantly where employers and employees cannot agree to an enterprise bargaining agreement following the termination of industrial action, accords with this object. Where a workplace determination has been made however, the effect of ss 52 and 277, as outlined at [58] above, is clear. The Court must look to the scope of the duties of each instrument, the ‘plain words’ of their terms and any clear meaning that they convey: Kanes Hire Pty Ltd v Mitchell (2010) 203 IR 37 at [25]-[27]; Kingmill Australia Pty Ltd t/a Thrifty Car Rental v Federated Clerks' Union of Australia (NSW Branch) (2001) 106 IR 217 at [70].

Scope of the NUW EBA

61.    The NUW EBA is an enterprise agreement made between the NUW and Qantas. The parties applied to Fair Work Australia for its approval pursuant to s 185 of the FW Act. It was approved by FWA pursuant to Chapter 2, Part 2-4, Division 4 of the FW Act (see s 186 and following) on 8 November 2011, and has a nominal expiry date on 30 June 2013.

62.    The NUW EBA represents the culmination of previous versions of the agreement extending back to 1998. The classification structure in the NUW EBA contains five storeperson classifications each with a description applicable to its level. Such classification structure envisages a broad variety of activities in which the employee might be engaged at the SFT1, and the highest levels of classification reflect the increased level of responsibility, complexity of operation and supervisory requirements. For example, Appendix A Table 1 – Classification structure contains the descriptions of each category of employee. Relevantly, the job description is as follows for each:

(a)    A storeperson level 1:

    Operation of, and care for basic freight equipment e.g. fork-lifts, tugs, belt loaders etc. in and around freight terminals;

    Basic import and export freight procedures;

    Special handling requirements e.g. livestock and perishables;

    General handling of freight (including but not limited to cargo, mail and express products).

(b)    A storeperson level 2 is one who spent a minimum of 12 months at level 1 and has demonstrated satisfactory performance. The freight specific functions of such an employee are:

    Operation of freight equipment including but not limited to hoists, by-pass machines, rolling stock and transfer vehicles in and around freight terminals;

    Export acceptance procedures;

    Retrieval and build-up procedures;

    Export dispatch and import check in procedures;

    Import loose and ULD delivery procedures including confirmation of freight delivered;

    ULD serviceability and contour checks.

(c)    A storeperson level 3 is an employee who has more experience than level 2 persons. They undertake storeperson level 2 functions, and have the following freight functions:

    ETV driving;

    Freight assembly and aircraft pallet restraining; and

    Cargo pick list assembly.

(d)    A storeperson level 4 is responsible for a group of staff in a work area. They undertake all the duties of a level 3 person, as well as the following freight functions:

    Coordinate the movement of freight to meet aircraft schedules;

    Ensure full confirmation/verification procedures are carried out by staff for all acceptance/delivery, inbound or outbound and tranship freight/mail; and

    Import and export ULD control.

(e)    A storeperson level 5 is responsible for a number of groups and performs all the duties of a level 4 storeperson and specifically, with respect to freight specific functions, such employees organise space on aircraft to dispatch to company stores worldwide.

63.    ‘Company’, as used in the storeperson level 5 description, is defined as Qantas Airways Limited and QCatering Limited, with the context in which ‘company’ is used determining which corporate body is being referred to. It is not clear which corporate body is being referred to under the storeperson level 5 description, however nothing turns on this point.

Scope of the TWU Determination

64.    Part 4 – Classifications, Wages and Allowances of the TWU Determination defines the classifications of employees working under the determination. Similar to the NUW EBA, the TWU Determination has classifications of ASO 1, ASO 2 and ASO 3, each of which relate to work of a more elementary nature than that of an ASO 4. Relevantly the levels include the following duties:

ASO – Level 2

    Baggage and freight function (non-aircraft).

ASO – Level 3

    Hands-on activities in all areas of work including that which is both directly and indirectly associated with aircraft handling and/or AAF PUD drivers.

    Operate equipment and vehicles including tow motors, small vans, tarmac buses, mobile steps, belts, non-tarmac forklift and equipment requiring similar operational skills associated with ramp, cargo, freight … and general transport operations.

65.    Relevantly, cl 18.3.5, contained in Part 4 defines the duties of an ASO 4 employee as:

    Operate all in hold aircraft systems and all ground handling and commercial type airport equipment;

    Ground handling equipment means all equipment associated with ramp, freight/cargo, catering, aircraft servicing and general transport operations;

    Operate communication and computer aids;

    Compile reports and documents;

    Work without direction supervision; and

    Carry out basic serviceability and maintenance checks of vehicles and/or equipment, including refuelling of vehicles.

66.    The evidence establishes that the employees managed by Qantas Freight employed as an ASO 4 total 67, made up as follows:

(a)    25 employees who were previously covered by NUW EBA 9 and who applied for the position of ASO 4;

(b)    17 employees who were recruited from Qantas Airports (i.e. were previously employed by the Respondent but managed by Qantas Airports), Menzies and agency casuals such as labour hire and having applied for the position of ASO 4; and

(c)    25 employees who were previously employed in the EHU or the MHU and who were already engaged in the position of ASO 4 and paid in accordance with the TWU Determination.

Comparison of the NUW EBA and TWU Determination

67.    There is no doubt that the NUW EBA provisions apply to work being undertaken within the SFT1 and in the immediate surrounding area, including:

    Functions relating to the dispatch, receipt and storage of freight within the SFT1;

    Handling freight containers within and around the SFT1, including moving the freight on or off tarmac areas using TVs;

    Handling freight for short term storage by use of ETV’s;

    Handling empty unit load devices around the container park; and

    Moving freight between the SFT1 and the SFT freight collection/deposit area.

68.    The duties specified in the TWU Determination are similar to those of the NUW EBA, but must cover a more extensive range of duties. For example, certain duties explicitly cover ramp work and transhipment as reflected by the references to ramp equipment and general transport operations in ASO 4, and the operation of various equipment associated with ramp, cargo and freight within ASO Level 3. As referred to previously, work undertaken in the MHU and EHU is covered by a TWU enterprise bargaining agreement.

69.    Qantas did not contest that the NUW EBA extended to employees engaged in work within and around SFT1; similarly the NUW did not contest that the TWU Determination covered transhipment and ramp work. Rather, each party argued that the terms of the instrument for which they contended extended further than those duties; namely the NUW contended that the NUW EBA covered work in the MHU and EHU, and ramp and transhipment work, and Qantas contended that the TWU Determination applied to work in the ULD transfer area where that work was performed as part of the duties of an ASO 4 employee under the TWU Determination.

70.    Dealing with each instrument in turn, it is important to note that terms of the NUW EBA within storeperson levels 1 and 2 are limited by the words ‘in and around the Freight Terminals’.

71.    It is significant that the duties outlined in the NUW EBA contain no reference to loading of aircraft, nor to aircraft generally (save for meeting aircraft schedules). Whilst the NUW submits that some of the equipment referred to in the NUW EBA is used in ramp and transhipment duties, the NUW EBA makes no reference to the use of such equipment for ramp and transhipment duties. Rather, the repeated references to the movement of freight are confined to locations in and around the SFT1. Such omissions indicate that these duties were never to be part of the duties of employees under the NUW EBA.

72.    Ramp and transhipment duties explicitly form part of the duties contained within the TWU Determination. This is made clear by the reference to the operation of all ground handling equipment, which includes, inter alia, all equipment associated with ramp operations and general transport.

73.    Furthermore, the TWU Determination work categories extend to the operation of all in-hold aircraft systems which are necessarily involved in the loading and unloading of aircraft. The latter duty requires the utilisation of specialised equipment such as conveyors and pallet loaders, and involves the highly important responsibility of ensuring that freight is loaded and unloaded correctly into and from aircraft. Such responsibility necessitates precision to ensure that the aircraft does not sustain damage in the process, but also requires the placement of freight in the correct positions within the aircraft hold to ensure safe weight distribution. In contrast, no such provisions exist in the NUW EBA.

74.    With regard to the ramp work which might have been performed by employees engaged at the SFT1 prior to the restructure, Mr Preston stated that on occasions he would be involved in tagging inbound ULDs on the tarmac area of the SFT and that he was involved in towing inbound freight ‘from designated areas on the tarmac’. He does not state how such ‘designated areas’ were defined, and nor does he suggest that such work was routine. None of the NUW witnesses suggest that they were ever involved in the loading and unloading of aircraft. Messrs Preston, Scott and Ranui said that since the restructure they have either received training or have in fact worked loading aircraft. It was not suggested that they have previously been so trained or engaged.

75.    The fact that some of the re-engaged employees may have done limited ramp or transhipment work when employed under the NUW EBA does not mean that such duties were properly covered by the NUW EBA. Even a broad interpretation of the NUW EBA in accordance with the principle referred to in Kucks at 184 and City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union (2006) 153 IR 426 at [57], does not justify the conclusion that ramp and transhipment work was intended to be covered by the NUW EBA.

76.    This conclusion is reinforced by the fact that prior to this application, the NUW had never previously sought to have employees of Qantas who worked on the ramp, in transhipment or in the MHU or EHU covered by the NUW EBA. This is reflected in the following excerpt of the cross-examination of Mr Richardson:

MR WARREN:    It is so, isn’t it, that you have never raised with Qantas a claim that the employees in the express handling unit, the mail handling unit, the ramp should be covered by the NUW EBA9 up until this case?

MR RICHARDSON:     In respect of the first two, that’s correct.

MR WARREN:        And in respect of - - -?

MR RICHARDSON:    In respect of ramp, as I said, I recall circumstances where our members have been subject to disciplinary action working on the ramp.

MR WARREN:        Yes. That - - -?

MR RICHARDSON:    But in short, no.

MR WARREN:    Leave aside whether one of your – I think you call it “on the tarmac” - - -?

MR RICHARDSON:    Why would I claim – why would I claim something when I was of the impression based on those events that persons were performing work on the ramp? That’s what I’m trying to say, Mr Warren.

MR WARREN:        I’m talking about the NUW EBA9 and its predecessors?

MR RICHARDSON:     Well, I believe - - - 

MR WARREN:    You had, at no stage, gone to Qantas and said, “Hey, you’re paying under the wrong instrument”?

MR RICHARDSON:    I’m sorry, Mr Warren, I thought you were asking me whether I had made that claim in respect to the numerous dealings I had had with management that I’ve referred to at page 25 – at paragraph 25.

MR WARREN:    No, I’m sorry if I’ve mislead you. I was taking you to the fact that you’ve had numerous dealings with Qantas?

MR RICHARDSON:    Yes.

MR WARREN:    I’m then saying, in all those numerous dealings, you have never said to Qantas, “You’re paying people in the express handling unit, mail handling unit or working on ramp equipment under the wrong EBA or industrial instrument?

MR RICHARDSON:    No.

77.    This was reaffirmed by Mr Richardson with respect to work in the EHU and MHU. His evidence reveals that in respect of negotiations for NUW EBA 8, there was no discussion concerning work being performed in the EHU, nor the MHU.

78.    The Court finds that the terms of the NUW EBA describe the duties to be undertaken in and around the SFT1, which include operating TVs and ETVs in the SFT1; handling freight that is received at, or processed through, the SFT1; and driving tugs for the purpose of either taking inbound international freight to a SFT freight collection/deposit area, or collecting outbound international freight from a SFT freight collection/deposit area.

79.    The terms of the TWU Determination are not so limited. The ASO 4 category encompasses the lower levels 1, 2 and 3. Level 3 specifically addresses ‘[h]ands-on activities in all areas of work, including that which is both directly and indirectly associated with aircraft handling…’. Such a broad scope would clearly encompass work conducted both on the ramp, in the ULD Transfer Area, and in between those locations.

80.    The Court accordingly concludes that the duties of an ASO 4 are clearly intended to encompass not only the freight handling around the SFT1, but to extend to all ramp operations with the object of ensuring the uninterrupted movement of freight from the SFT1 to the loading of that freight into the aircraft hold; the reverse movement of such freight from aircraft to the SFT1; and transhipment duties. Ramp and transhipment duties were not included in the employees duties under the NUW EBA. However, this finding does not have the consequence that the Court is satisfied that all of the employees classified as ASO 4 are in fact yet fulfilling such duties, as is considered below.

Categorisation of work being undertaken by re-engaged employees

81.    The crux of the NUW’s submission is that the work currently being performed by the employees who have been re-engaged in the position of ASO 4 is no different from that which they were performing prior to the restructure.

82.    The NUW refers to the predecessor agreements to the NUW EBA and submits that the NUW EBA classifications have evolved since 2005 when the first NUW EBA agreement was created and which in part was based upon the previous Airline Operations (Qantas Airways Limited) Award 1999. Prior to 1999, the NUW and Qantas had entered into an enterprise agreement for the SFT in 1997 known as the SFT Restructure Agreement, and the team structure resulting from that agreement provided for work to be done outside the SFT1, the ULD transfer area, and which included some ramp functions. Accordingly, it is submitted that there was a common intention of creating a team-based structure designed to maximise flexibility, allowing those covered by the NUW EBA to work on the tarmac. The fact that such work could be undertaken by storepersons covered by the NUW EBA was also consistent with a former agreement known as the Sydney Freight Terminal Temporary Storepersons Agreement made between the NUW and Qantas and which took effect from 14 May 2004.

83.    The NUW submitted that the principal change brought about by the restructure relates to the issue of ramp and transhipment work; that based upon the evidence of Mr Scott, Mr Ranui and Mr Preston, the roles and functions of the re-engaged employees have not substantially changed since October 2012. Whilst some employees might have undergone training on ramp duties since that date and have also performed such duties intermittently, the NUW submits that there is no evidence of those employees being asked to do work in the MHU or the EHU or to do transhipment work. The NUW submits that not even Qantas suggests that any of the re-engaged employees are presently spending significant time performing duties other than those which they were performing when covered by the NUW EBA.

84.    Accordingly, the NUW submits that as long as the NUW EBA is in operation, and by extension of the reasoning above, as long as the work of the re-engaged employees remains the same, the NUW EBA covers those employees. The NUW also relies upon other submissions and submits that no estoppel would operate to deny an employee entitlements owed under a registered industrial agreement and that no discretionary reasons for denying the relief sought arises. Such considerations fall away should the Court find that the work of the re-engaged employees does not come within the scope of the NUW EBA. For the reasons that follow, the Court so finds.

85.    The Court accepts that Messrs Preston, Scott and Ranui are undertaking many duties that they previously completed under the NUW EBA. Mr Ridolfo testified that the purpose of the restructure was to provide a workforce which was multi-skilled, in the sense that an ASO 4 would be competent to undertake not only the work around the SFT1 but would also be qualified to work on the ramp and be engaged in the ramp activities of loading and unloading aircraft and transporting freight directly from the SFT1 to the aircraft and return. By this process, SFT freight collection/deposit areas would be eliminated. This was the intended consequence of the restructure. A more efficient use of manpower, by having a team ‘multi-skilled’ to perform a variety of functions, was at the heart of the reforms.

86.    It follows that the re-engaged employees were required to be re-trained for their expanded duties, and the evidence suggests that training may extend for up to 18 months. The necessity for training in the new role was specifically referred to in the information provided to employees prior to the restructure. As stated in the information sheet, the role of an ASO 4 was described as follows:

Located within Qantas Freight, this role will involve operating all relevant machinery and servicing of aircraft in compliance with agreed service standards.

You will be responsible for:

•    All apron mail and express operation procedures and the operation of relevant machinery in accordance with KPI’s and policies, procedures and awards

•    Aircraft receipt and despatch duties on various aircraft types

•    Adhering to aviation legislative requirements in relation to ramp loading procedures

•    Handling of mail services in a timely, accurate and secure manner

•    Remaining compliant with Corporate, Divisional and Service Standards

87.    Although the NUW argued that certain equipment on the ramp performed ‘basically’ the same function as equipment within the SFT, the Court is satisfied that the training for ramp work is necessary for the duties of an ASO 4 and for purposes different to those carried out around the SFT1. Significantly, Messrs Preston, Scott and Ranui each testified that after accepting the ASO 4 positions under the TWU Determination, they received training for their expanded duties. For instance:

    Mr Preston has undertaken approximately eight days training in loading and unloading aircraft including baggage belt loading and operating a FMC;

    Mr Scott has undertaken training in ramp work for approximately three weeks. This involved the use of FMCs and the mobile conveyer belt; and

    Mr Ranui has undertaken training for approximately 10 days in relation to the unloading and loading of freighter aircraft. This included operating the joystick and switches in the aircraft hold to move freight within the aircraft hold, along with operating a FMC.

88.    The Court notes the evidence of Mr Preston that he is undertaking the same work under the TWU Determination that he did under the NUW EBA, being predominantly the tagging and moving of ULDs. This may be explained by the fact that at the time of swearing his affidavit on 21 January 2013, he had not yet been certified to load and unload aircraft despite the training he had undertaken. Mr Scott had also not yet been certified for loading or unloading aircraft as of 21 January 2013, but the evidence shows that his training has continued. Immediately before the hearing, Mr Scott was certified to use belt loaders in the course of ramp work.

89.    In any event, Mr Preston’s experience may be atypical of the experiences of the other employees who were re-engaged in ASO 4 positions. This is reflected in the work of Mr Ranui, who testified that he performs ramp work, specifically loading and unloading duties on 747 Atlas freighter aircraft, for approximately a third of each day.

90.    The evidence of Mr Ridolfo indicates that work now being undertaken on the ramp, freight transportation in the ULD transfer area and transhipping, is conducted by at least some of the employees in the category ASO 4, whilst other employees now under the TWU Determination are still being trained. The process of converting to a seamless operation for the movement of freight to and from the ramp by the training of all ASO 4 employees is still being implemented.

91.    Only three employees have provided evidence on behalf of the NUW, and each of them have undergone ramp training and undertaken some ramp duties. Mr Ranui in particular spends a significant part of each day loading and unloading an aircraft and Mr Preston has worked on five freighter aircraft. The Court is left to speculate whether the assertions of those three workers that the duties of others are indeed little different to the work they undertook prior to the restructure. In summary, the evidence of Messrs Preston, Scott and Ranui falls short of the evidence necessary to satisfy the Court that the relief sought by the NUW should be granted.

92.    In reaching the above conclusion, the Court has applied the test referred to in J Fenwick & Company Pty Ltd v Merchant Service Guild of Australia (1973) 150 CAR 99 at 101-102 where Ludeke J held:

To ascertain the course of the calling of particular employees, is not enough merely to make a quantitative assessment of the time spent in carrying out the various duties. In my opinion, not only should the nature of the work done by the class of employee be examined but it is equally relevant to consider the circumstances in which they are employed to do the work; if a worker is required by his employer to carry out diverse duties, the enquiry should be directed to ascertain the principal purpose for which the worker is employed.

93.    A similar test was adopted in Carpenter v Corona Manufacturing Pty Ltd (2002) 122 IR 387 by the Full Bench of the Australian Industrial Relations Commission at [9] as follows:

In our view, in determining whether or not a particular award applies to identified employment, more is required than a mere quantitative assessment of the time spent in carrying out various duties. An examination must be made of the nature of the work and the circumstances in which the employees employed to do the work with a view to ascertaining the principal purpose for which the employee is employed.

(Reference removed)

94.    The NUW EBA will continue to apply to those employees who are engaged solely within or around the SFT and who have not elected to become ASO 4 employees. There is no conflict of coverage in view of the different duties which are to be performed in the differing roles. Conflict of coverage is avoided when recognition is given to the fact that the operations involve different skills. Within the SFT1, duties are confined to the skills of a storeperson. In contrast, an ASO 4 performs a much wider range of tasks, some of which take place around the SFT1.

95.    The Court also observes that no direct evidence by the Qantas employees exists to shed light on the question whether the work of the re-engaged workers is typical of the remaining 24 and in what way the work of those 24 differs from the work which they were performing before the restructure. Mr Ridolfo could only address the work which was intended by the restructure and which he believed was being performed. It would have been of greater assistance had there been evidence of persons with first-hand knowledge of the regular duties of the employees. By way of example, in his affidavit sworn 7 February 2013 Mr Ridolfo testified that from an analysis based upon data provided to him by Jim Buschkens, Demand Planning Coordinator at SFT, approximately 30% of the work of freight transportation occurs in the ULD transfer area; 51% is attributable to the MHU and EHU; 8% is attributable to transhipment; and 10% of the work is attributable to freighter ramp handling. However, in cross-examination, when asked about the work which was being performed, his evidence was remarkably vague. Mr Ridolfo could only say that the re-engaged employees were doing a ‘combination’ of duties; when asked whether such employees were predominantly performing functions on a day to day basis within the ULD transfer area as they were prior to the restructure, Mr Ridolfo responded:

I think my answer to that would be no because I know they’re doing other things. I suppose what percentage is predominant, I’m not sure, so.

96.    The following exchange then occurred:

MR JOSEPH:    So – I’m not sure I understand your evidence, sir. You’re saying they’re doing – as a group they’re doing – they’re not predominantly doing work within the ULD area?

MR RIDOLFO:    They are doing work within the ULD area, they’re not denying that but they’re doing other functions as well. So the word “predominant” I suppose is – what’s predominant?

97.    Shortly thereafter the following evidence was provided by Mr Ridolfo:

MR RIDOLFO:     So if we look at our skill base, we’ve employed employees – employed and had employees with certain skill bases, i.e. 10 mail and express employees. They obviously have – the permanent ones I’m talking about – skill base in that. We have employees that have come over from Qantas airports, i.e. ramp and Menzies who have a skill base on the aircraft. And we have our employees that transferred within the ULD transfer area and they have that skill base. In addition to that, we have employees that have started that had no skill base. So we’ve undergone, obviously, a big training program where we need to train those people up. So the people that have had those skills haven’t rotated as much as the people who have no skills, because we’ve been training them up and moving them around first, if that helps clarify the picture.

MR JOSEPH:    I think that might mean that the persons I’m referring to, the NUW covered people, have in fact predominantly remained working in the ULD transfer area. I’m not saying none of them – I’m not putting to you that none of them have worked on a freighter aircraft since the restructure. I’m not putting that. What I’m putting, that as a group predominantly, for the larger amount of their time, they have continued to be doing work in the ULD transfer area?

MR RIDOLFO:    They may have, yes.

98.    This evidence tends to confirm that the training of the ASO 4 personnel is continuing and that the implementation of the restructure remains incomplete. However, this fact does not detract from the finding of the Court that the duties of an ASO 4 are distinct from those covered by the NUW EBA. The evidence which has been adduced establishes that the critical duties of an ASO 4 such as the loading and unloading of an aircraft are being undertaken by re-engaged employees.

99.    In these circumstances the Court declines to answer the specific issues proposed by the parties, save as to decline to grant the declaratory relief sought in the application by the NUW.

CONCLUSION

100.    Additionally, the Court notes that some evidence was led by the NUW concerning pay rates and conditions for the employees covered by the NUW EBA compared to those engaged under the TWU Determination. In view of the Court’s decision it is unnecessary to refer to such evidence.

101.    For the above reasons the Court dismisses the application.

Associate:

Dated:    27 September 2013