FEDERAL COURT OF AUSTRALIA

Truck Moves Australia Pty Ltd v Simmonds [2015] FCA 1071

THE COURT ORDERS THAT:

1.    It be declared that the applicant’s employment of each respondent was not covered by the Road Transport and Distribution Award 2010 or the Road Transport (Long Distance Operations) Award 2010.

2.    It be declared that during the period between 1 January 2010 and the respective dates on which his employment by the applicant terminated, the applicant was required to pay each respondent in accordance with the national minimum wage order as in force from time to time made pursuant to the provisions of the Fair Work Act 2009 (Cth) or at any higher rate actually paid to him.

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

REASONS FOR JUDGMENT

1    Truck Moves Australia Pty Ltd seeks declarations that, first, it has not ever been an employer that is covered by each of the Road Transport and Distribution Award 2010 (the RTD Award) and Road Transport (Long Distance Operations) Award 2010 (the RTLDO Award) since they commenced operating as modern awards on 1 January 2010 and secondly, that from 1 January 2010 to the respective dates that the two respondents, Brian Simmonds and John Zader (together “the two drivers”) ceased to be its employees, it had to pay each of them in accordance with the national minimum wage order made under Pt 2-6 of the Fair Work Act 2009 (Cth). Each of Mr Simmonds and Mr Zader asserts that he was entitled to be paid under the RTD Award and not at the lower rate of pay that Truck Moves used to remunerate him for his work.

2    Truck Moves’ business usually, but not exclusively, involved it using its employee drivers, including Mr Simmonds and Mr Zader, to move unladen vehicles for its clients between locations. The vehicles were generally unregistered, but Truck Moves drivers moved them after they had fitted trade (registration) plates. Trade plates have a condition of use that vehicles driven when displaying them not be laden.

3    The central issue in these proceedings is whether the movement of unladen trucks, or other vehicles, with trade plates affixed is itself within the meaning of “the transport by road of goods” as used in the definition of “road transport and distribution industry” in cl 3.1 of the RTD Award (the industry definition). In other words, the issue is whether the trucks or vehicles that Truck Moves’ drivers move between locations are themselves “goods” so that Truck Moves’ business activity is “the transport of goods”, being the movement by road of the trucks or vehicles that its drivers convey between the two locations.

4    All the parties agreed that, first, the RTLDO Award did not apply to the situation of either Mr Simmonds or Mr Zader, and, secondly, if the minimum wage order applied to him, he was not underpaid.

5    I will first set out the relevant statutory scheme under the Act, because it is fundamental to understanding how a modern award made by the Fair Work Commission, and its predecessors including the Australian Industrial Relations Commission (which I will also simply call “the Commission”) should be construed. I will then explain the relevant provisions of the two Awards, before setting out the more elaborate factual context and the process under which those modern awards came to be made and then dealing with the resolution of the issues.

The statutory scheme

6    Relevantly, a modern award is one made under Pt 2-3 of the Act (s 12) and a reference in the Act to such an award applying to an employee is “a reference to the award applying to the employee in relation to particular employment” (s 47(3)). Under s 48(1):

48    When a modern award covers an employer, employee, organisation or outworker entity

When a modern award covers an employee, employer, organisation or outworker entity

(1)    A modern award covers an employee, employer, organisation or outworker entity if the award is expressed to cover the employee, employer, organisation or outworker entity.

7    Part 2-3 deals with modern awards and s 134(1) defines the modern awards objective as requiring the Commission to:

ensure that modern awards, together with the National Employment Standards, provide a fair and relevant minimum safety net of terms and conditions, taking into account:

…

(f)    the likely impact of any exercise of modern award powers on business, including on productivity, employment costs and the regulatory burden; and

(g)    the need to ensure a simple, easy to understand, stable and sustainable modern award system for Australia that avoids unnecessary overlap of modern awards;

8    A modern award can only include terms that are permitted or required by specific provisions of the Act identified in s 136(1). The Commission has the discretion to set out terms in a modern award, including terms:

    about type of employment, such as full-time, casual, regular part-time employment and shift work (s 139(1)(b);

    that are “essential for the purpose of making a particular term operate in a practical way” (s 142(1)(b)).

9    In addition, the Commission must include terms identified in s 143, which, relevantly, provides:

143    Coverage terms of modern awards other than modern enterprise awards and State reference public sector modern awards

Coverage terms must be included

(1)    A modern award must include terms (coverage terms) setting out the employers, employees, organisations and outworker entities that are covered by the award, in accordance with this section.

Employers and employees

(2)    A modern award must be expressed to cover:

(a)    specified employers; and

(b)    specified employees of employers covered by the modern award.

…

How coverage is expressed

(5)    For the purposes of subsections (2) to (4):

(a)    employers may be specified by name or by inclusion in a specified class or specified classes; and

(b)    employees must be specified by inclusion in a specified class or specified classes;

(6)    Without limiting the way in which a class may be described for the purposes of subsection (5), the class may be described by reference to a particular industry or part of an industry, or particular kinds of work.

Employees not traditionally covered by awards etc.

(7)    A modern award must not be expressed to cover classes of employees:

…

(b)    who perform work that is not of a similar nature to work that has traditionally been regulated by such awards.

Note:    For example, in some industries, managerial employees have traditionally not been covered by awards.

The RTD Award

10    Clause 3.1 provided definitions of the meaning of terms used in the RTD Award that applied unless the contrary intention appeared, including:

ancillary vehicles and/or equipment means mechanically powered vehicles and/or equipment (other than trucks) used by employers in the loading, unloading, stacking, moving, sorting or handling of goods and/or materials in connection with work which is part of or ancillary to the business of the employer

distribution facility means a facility from which goods are distributed by road (and at which such goods may be stored for the purposes of subsequent distribution) which is operated by an employer as part of or in connection with a road transport business of that employer

employee means national system employee within the meaning of the Act

employer means national system employer within the meaning of the Act

road transport and distribution industry means:

(a)    the transport by road of goods, wares, merchandise, material or anything whatsoever whether in its raw state or natural state, wholly or partly manufactured state or of a solid or liquid or gaseous nature or otherwise, and/or livestock, including where the work performed is ancillary to the principal business, undertaking or industry of the employer;

(b)    the receiving, handling or storing of goods, wares, merchandise, material or anything whatsoever whether in its raw state or natural state, wholly or partly manufactured state or of a solid or liquid or gaseous nature or otherwise in a distribution facility;

(c)    the storage and distribution of goods, wares, merchandise, materials or anything whatsoever whether in its raw state or natural state, wholly or partly manufactured state or of a solid or liquid or gaseous nature or otherwise, and/or livestock where the storage and distribution activities are carried out in connection with air freight forwarding and customs clearance;

(d)    the wholesale transport and delivery by road of meat from abattoirs, slaughterhouses, and wholesale meat depots;

(e)    mobile food vending;

(f)    the cartage and/or distribution, in tankers, of petrol or bulk petroleum products (in the raw or manufactured state) from refineries, terminals or depots of oil companies and/or distributors; the cartage and/or distribution on road vehicles of packaged petroleum products (in the raw or manufactured state) from refineries, terminals or depots of oil companies and/or distributors and the transport and/or distribution of petrol and petroleum products (in the raw or manufactured state) for distributors of oil companies or for contractors or sub–contractors to such distributors;

(g)    the road transport of crude oil or gas condensate;

(h)    the transport on public roads of milk and cream in bulk, and the transport, vending and distribution of milk, cream, butter, cheese and their derivatives (including fruit juices, yoghurt and custard); and/or

(i)    the cartage by road of quarried materials. (bold emphasis added)

11    In addition, cl 3.1 also defined:

    “articulated vehicle”, “double-articulated vehicle”, “low loader” and “road-train vehicle”, each of which dealt with the characteristics of a vehicle and semitrailer or, in the latter case, a rigid vehicle to which two or more trailers were coupled or an articulated vehicle to which one or more trailers were coupled;

    “interstate operation” as meaning an operation involving a vehicle moving livestock or materials from one State or Territory to a different State or Territory;

    “long distance operation” as meaning any interstate operation, or return journey, where the distance travelled exceeded 500 kilometres;

    “truck loading crane” as a crane mounted on a truck or trailer used for the purpose of loading onto, or unloading from, it loads.

12    Clauses 4.1, 4.2 and 4.8 relevantly provided:

4    Coverage

4.1    This industry award covers employers throughout Australia in the road transport and distribution industry and their employees in the classifications listed in clause 15 – Classifications and minimum wage rates to the exclusion of any other modern award.

4.2    This award does not cover employers and employees covered by the following awards:

…

•    Road Transport (Long Distance Operations) Award 2010 whilst undertaking long distance operations

4.8    Where an employer is covered by more than one award, an employee of that employer is covered by the award classification which is most appropriate to the work performed by the employee and to the environment in which the employee normally performs the work.

NOTE:    Where there is no classification for a particular employee in this award it is possible that the employer and that employee are covered by an award with occupational coverage.

13    Clause 15.1 provided that Sch B set out the classification definitions for distribution facility employees, and Sch C set out the classification structure and minimum rates of pay. Clause 15.2 set out minimum rates of pay for full-time adult transport workers in grades 1-10. Various allowances were set out in cl 16, including those payable to employees required to drive motor vehicles with particular characteristics, such as having a truck loading crane (cl 16.2(b)(ii)), or of a particular size or in a particular trade or business. Ordinary hours of work were prescribed in cl 22.1, but these were subject to exceptions in cl 22.4 based on particular businesses, such as newspaper, meat or live poultry deliveries, or fish, fruit or vegetable stores.

14    Clause 19 provided:

19    Higher duties

Where an employee is required to perform two or more grades of work on any one day the employee is to be paid the minimum wage for the highest grade for the whole day.

15    Schedule A dealt with transitional provisions, including those in item A.2.1 that applied to an employer that, immediately before the RTD Award commenced, was obliged to pay a minimum wage lower than that provided for in the RTD Award pursuant to, relevantly, an award-based transitional instrument (such as a notional agreement preserving State awards (NAPSA))

16    Schedule B included some classifications for distribution facility employees who had to operate trucks with particular characteristics (items B2.1(e)(iii), B3.1(f)(iv)). Similarly, Sch C provided that three of its 10 grades of transport workers included drivers of vehicles with particular characteristics that involved cranes, namely a mobile crane lifting up to and including 25 tonnes (grade 6), between 25 and 50 tonnes (grade 8) and in excess of 50 tonnes or a gantry crane (grade 9). Some of the classifications prescribed additional rates of pay based on characteristics such as, first, the load carried, varying with each extra tonne in excess of 43 tonnes of gross combination mass, being the maximum permissible mass for the motor vehicle and its load allowed under the law of any State or Territory (grade 7), or secondly, driving multi-axle platform trailing equipment with carrying capacities varying for each extra 10 tonnes in excess of 70 tonnes and up to 300 tonnes (grade 10).

The RTLDO Award

17    As noted above at [4] and [12], cl 4.2 of the RTD Award did not cover employers and employees covered by the RTLDO Award whilst undertaking long distance operations, and the parties agreed that the latter Award did not apply to either Mr Simmonds or Mr Zader. However, the provisions of the RTLDO Award were intended to apply to persons who would otherwise have been covered by the RTD Award, but for its cl 4.2. Thus, the RTLDO Award is to be read together with, and may aid in the construction of, the RTD Award.

18    The RTLDO Award provided, relevantly in cl 3.1, substantially the same definitions of “interstate operation”, “long distance operation” and the various types of vehicles as the RTD Award, and defined “private transport industry” as meaning “the transportation by road of all materials whether in a raw or manufactured state, or of livestock, throughout Australia”. Clauses 4.1 and 4.2 of the RTLDO Award provided:

4    Coverage

4.1    This industry award covers employers throughout Australia in the private transport industry engaged in long distance operations and their employees in the classifications listed in Schedule A – Classification Structure to the exclusion of any other modern award.

[New 4.2 inserted by PR551128 ppc 08Jul14]

4.2    The award does not cover an employee while they are temporarily required by their employer to perform driving duties which are not on a long distance operation, provided the employee is covered by the Road Transport and Distribution Award 2010 while performing such duties.

19    Because cl 4.2 of the RTLDO Award was only inserted after each of the two drivers ceased to be employed by Truck Moves, it is not presently relevant. Clause 4.8 was in the same terms as its counterpart in the RTD Award. Schedule A set out a classification structure based on tonnage capacity or vehicle type.

Background

20    Truck Moves brought these proceedings after each of the drivers complained to the Fair Work Ombudsman that they had been underpaid. They had claimed that the RTD Award applied to them while they were employees of Truck Moves but that they had not been paid in accordance with that award. Truck Moves’ sole director and shareholder is Matthew Whitnall.

21    Mr Simmonds worked for Truck Moves between 29 March 2012 and about 11 November 2013 as a casual driver. Mr Zader first commenced employment with Truck Moves on 15 August 2005 as a casual driver when he was based in Sydney. In about 2008, Mr Zader moved to live in Melbourne and continued to drive trucks for Truck Moves, but in around 2009 he had several months break before resuming this work. Then, in May 2011, Mr Zader suffered a heart attack and was unable to work for two and a half months. He said that he last worked for Truck Moves on 25 March 2013 although Mr Whitnall said that his last day was 25 August 2013. It is not necessary to resolve that discrepancy.

22    Truck Moves’ contract of employment under which each of the drivers worked contained the following terms:

You are employed on a casual basis. As such, Truck Moves is under no obligation to provide you with any number of shifts, hours or jobs.

…

These terms and conditions are the written authorisation you require to operate various traders plates in your capacity as a driver working exclusively as directed by Truck Moves …

23    Mr Whitnall explained that Truck Moves’ business predominantly was to ferry commercial vehicles that were brand new, not registered or partially built from importers to wholesalers. Truck Moves took possession, and so became bailee for reward, of the vehicles. Mr Whitnall said that the vehicles did not carry any freight or goods. The vehicles were driven unladen both locally and interstate as the client required. He said that the types of vehicles varied, but they were predominantly unregistered or in a pre-registration state and that, when its drivers drove them, in the majority of cases they fitted trade plates owned by Truck Moves as the vehicles’ number plates. The vehicles could be of any size or type, including rigid vehicles with varying gross vehicle mass (GVM), two or more axle rigid vehicles or larger trucks. Truck Moves also moved passenger cars, such as fleet vehicles between yards or to auctions, or delivered new vehicles and returned with the traded-in vehicles that they replaced, again using trade plates, including where such vehicles were registered. Mr Whitnall understood that under State and Territory laws, a vehicle being driven with trade plates cannot carry freight or a load.

24    Mr Whitnall said that Truck Moves engaged its drivers as casual employees and paid them in accordance with the national minimum wage order made by the Commission under the Act, including in respect of the applicable casual loading.

25    Mr Whitnall described the typical work that a driver would perform on any given day. On occasion, the driver could perform short and long distance operations on the same day. Often, a driver would drive a vehicle between two locations and would be driven in a taxi or Truck Moves’ shuttle vehicle to or from those locations. Sometimes, the driver would take a taxi to an airport, fly to another location, take a taxi or shuttle to the vehicle’s location and then drive it to the desired destination whence the driver, again, would be taken to his or her next destination. Mr Whitnall said, basing his trip times on information that he obtained from Google maps, that an example of a regular day for Mr Zader was 30 April 2012. He said that on that day:

Mr Zader completed five deliveries for Truck Moves:

(a)    Mr Zader first picked up an unregistered Mercedes cab chassis in Derrimut, and drove it 44 kilometres to Mulgrave. This trip takes around 49 minutes;

(b)    Mr Zader was then picked up by a Truck Moves shuttle bus and driven to his next job in Dandenong, a trip that takes around 12 minutes;

(c)    in Dandenong, Mr Zader picked up an unregistered UD cab chassis and drove it 53 kilometres to Laverton, this trip takes around one hour;

(d)    Mr Zader was then picked up by a Truck Moves shuttle bus and driven to his next job in Bayswater, about one hour's drive away;

(e)    In Bayswater, Mr Zader picked up an unregistered DAF cab chassis and drove it 63 kilometres to Laverton, this trip takes around 53 minutes;

(f)    Mr Zader was then picked up by a Truck Moves shuttle bus and driven approximately 10 minutes to his next job in Laverton;

(g)    In Laverton, Mr Zader picked up an unregistered UD cab chassis and drove it 17 kilometres to Appleton Dock, this trip takes around 18 minutes;

(h)    Mr Zader was picked up by a Truck Moves shuttle bus and driven to his next job in Derrimut, a trip that takes around 19 minutes;

(i)    In Derrimut, Mr Zader picked up an unregistered Mercedes cab chassis and drove it 9 kilometres to Laverton, this trip takes around 14 minutes; and

(j)    Mr Zader was then picked up by a Truck Moves shuttle bus and driven back to the Truck Moves yard in Derrimut where he completed his work for the day.

26    Mr Zader was driving for only about three hours, or 35% of that work day (which was less than usual), and was in a shuttle vehicle for about two hours, or 23% of that day. Mr Whitnall said that Mr Zader would have spent the rest of that day on breaks, checking the vehicles for pre-existing damage, fitting and removing the trade plates, completing paperwork or waiting for the vehicle to be made available for him to drive. Mr Whitnall said that on average Mr Zader spent about 50% of each working day ferrying vehicles and I infer that so did Mr Simmonds other than when he was driving the shuttle vehicle. It may be that, as Mr Simmonds estimated, drivers spent longer ferrying vehicles, but I do not consider that anything turns on this.

27    There were rare occasions on which Truck Moves drivers drove vehicles that were loaded. However, Mr Whitnall denied that Truck Moves was in the freight industry and I accept his evidence. He analysed Truck Moves records for the period between January 2007 and April 2013, when at least one of the two drivers were its employees, searching for the words “freight”, “goods” and “load”. Mr Whitnall found that in that period Truck Moves had performed a total of 62,600 jobs and only had a record of 26 occasions, neither of which involved Mr Simmonds or Mr Zader, where the word “loaded” appeared. There were no records of the words “freight” or “goods”. He said that the 26 occasions occurred over a short period of time and they were caused because an employee had misunderstood his functions. Mr Whitnall said that when he became aware of this situation he pointed out the error to the employee to ensure that the misunderstanding ceased. I accept Mr Whitnall’s evidence generally, and this evidence in particular.

28    Mr Whitnall said, and I find, that:

Truck Moves' drivers are directed not to drive vehicles that are laden with any freight or goods. I know this because I have regularly conveyed this instruction to drivers, I have also conveyed to state operations managers to convey that message to drivers, and I have observed operations managers conveying this message to drivers. If a driver arrives at a job and encounters a vehicle that is loaded, Truck Moves’ drivers are directed to contact Truck Moves and seek advice as to what to do. I can only recall one occasion where I received a call from a Truck Moves’ driver who had arrived at a job to find a vehicle that was loaded with goods. On that occasion, the driver (I do not now recall who) called the Truck Moves’ base. I answered the call and managed the situation. I called the client and said to them “our service does not move loaded vehicles. I am removing the driver and charging you a futile”. A ‘futile’ is a charge to the client where a driver has had to attend the job site, but the vehicle was un-driveable, un-roadworthy, or otherwise not ready at the agreed time or place, or in the condition expected, that is, unladen and able to be driven.

29    Mr Whitnall also analysed the business records for work performed by each of Mr Simmonds and Mr Zader and prepared the following tables:

30    In addition, Mr Whitnall noted that Truck Moves was not insured for the carriage of freight, consistently with the restrictions imposed by the requirements relating to its use of trade plates. However, he noted that customers occasionally required an unregistered trailer to be moved and that Truck Moves did this using the customer’s vehicle. Mr Whitnall said that examples of this appeared in the table of Mr Zader’s work above, in the 41 movements recorded for “Truck & Trailer” or 3.5% of his total jobs.

31    Mr Whitnall’s analysis showed that about 96% of Mr Zader’s jobs involved the relocation of unregistered vehicles. The reference to “Interflow” in the table concerned work performed for a company that had specialised pipe lining equipment permanently fitted to its vehicles. Truck Moves’ drivers ferried the Interflow vehicles to a job site or airport and then handed them over as Interflow had directed. I find that equipment fixed to the Interflow trucks formed part of the trucks and could not be classified as goods carried on them, any more than could a crane or a cement mixer fixed to a truck.

32    Truck Moves also performed, and advertised itself as available to perform, work moving outside broadcasting and satellite vehicles. These vehicles were fitted with fixed equipment that the Truck Moves drivers drove to or from major sporting events or concerts. Mr Whitnall found 20 instances (or 0.0319%) of such jobs in his analysis that Truck Moves performed for a company called Globe Cast, none of which, he said, appeared to involve Mr Zader. However, Mr Zader gave unchallenged evidence, that I accept, that he had delivered registered trucks of this kind for Globe Cast. I find that the fixed equipment on such a vehicle is a part of the vehicle and not in the nature of goods or freight carried on it.

The process leading to the making of the RTD and RTLDO Awards

33    The Commission began the process that led to the making of the RTD and RTLDO Awards (the two Awards) before the commencement of the Act following a request from the Minister under s 576C(1) of the now repealed. On 23 January 2009 the Commission published exposure drafts of 24 modern awards, including drafts of the two Awards, and a statement for doing so: [2009] AIRCFB 50 (the Statement).

34    It explained that each of those drafts was a broad industry award that described coverage by reference to the industry of the relevant employers. It said that the draft RTD Award had a broad definition of the road transport and distribution industry that was “intended to incorporate the scope of the pre-reform Transport Workers Award 1998 … and NAPSAs operating in each state as the general industry transport award” and other specialised awards. The Commission said that those comprised a subset only of the sectors covered by the draft and “the parties should give close consideration to the definition of the industry” ([2009] AIRCFB 50 at [97]-[98]). The draft definition of the industry in cl 3.1(a) did not include the words “by road” after “transport” and, as I will explain, it added these when it made the final version of the RTD Award. The Commission stated that the parties should give consideration to whether there was a need to identify other activities in the definition and continued ([2009] AIRCFB 50 at [99]-[100]):

[99]    … In this respect, however, we note the breadth of paragraph 3.1(a) of the definition and it may not be necessary to specifically identify the various subcategories of those goods, wares and merchandise, etc.

[100]    The coverage of the award also extends to the transport of goods, etc. where the work performed is ancillary to the principal business, undertaking or industry of the employer ...

35    The Commission also noted the coverage in the draft extended to activities previously covered by distribution awards (at [101]).

36    Relevantly, the Transport Workers Award 1998 provided in cll 6.1 and 7.1:

6.1    The industry covered by this award is or is in connection with the transport of goods, wares, merchandise, material or anything whatsoever whether in its raw state or natural state, wholly or partly manufactured state or of a solid or liquid or gaseous nature or otherwise, and/or livestock.

7.1    This award shall be binding on the Transport Workers’ Union of Australia, its officers and its members, and on those employers whose names are set out in Schedule “A” hereto in respect of all their employees whether members of the Union or not and who are required to perform work covered by this award. (emphasis added)

37    Next, on 3 April 2009, the Commission published its Decision to make, among others, the two Awards ([2009] AIRCFB 345). The Commission recorded that no party had submitted that any additional paragraphs needed to be added to the definition of the road transport and distribution industry in its exposure draft of the RTD Award, but it stated that ([2009] AIRCFB 345 at [168]-[169], [171]):

[168]    … No party submitted that any additional paragraphs needed to be added to the definition and accordingly it retains paragraphs (a) to (i) however we have made some variations to make it clear that the award relates to the transport of goods etc by road. We have also adopted the definition of a distribution facility as proposed by the Transport Workers’ Union (TWU) so it is clear that they are facilities which are operated by an employer as part of its road transport business.

[169]    We have retained the reference in paragraph (a) of the definition of the road transport and distribution industry to the transport of goods etc where that work is ancillary to the principal business, undertaking or industry of the employer …

[171]    We also gave consideration to a number of other matters. Even though the RT&D Modern Award is an industry award it is clear that the practical effect of the various existing private transport awards it encompasses is that they operate by reference to a structure of types, models and classes of vehicle and, it follows, to the driver of those vehicles thereby having occupational coverage. We note that there are very few transport classifications in the modern awards made to date and it is likely that any transport functions of any significance are carried out by dedicated transport operators. If the transport of goods etc as defined in the RT&D Modern Award is ancillary to an employer’s business but it is carried out by an employee in one of the classifications in the award it should be covered by the award. In this respect we are not persuaded that an employer will loose [sic] the ability to have those drivers, who may be a small number only of its workforce, work hours which the employer’s business requirements dictate. The RT&D Modern Award contains numerous facilitative provisions which relate to matters like hours of work, shifts and spread of hours. (emphasis added)

38    In 2008 and 2009, Mr Whitnall was aware of the ongoing award modernisation process being undertaken by the Commission. He kept himself informed of it but did not involve Truck Moves in it. He said that this was because he did not understand that the modern award would affect matters to cause a change in his belief that Truck Moves’ business and employees were not covered by any award. Mr Whitnall said that, as a result, Truck Moves paid its drivers in accordance with the national minimum wage order and continued to organise and carry on its business on the basis that its drivers were not covered by the RTD Award or any other award.

The two drivers’ submissions

39    The two drivers argued that the trucks or other vehicles that Truck Moves ordinarily had its drivers deliver to, or convey for, its customers, were themselves “goods” that were transported by road as a result of that operation, within the meaning of the definition in cl 3.1 of the RTD Award of “road transport and distribution industry”. The two drivers argued that the Commission intended that the RTD Award would have a broad application and relied on the decision of Judge Burchardt in Rooth v S. Brady Industries Pty Ltd t/as Vehicle Relocators [2014] FCCA 1435 who had held that, in respect of a business similar to that of Truck Moves, vehicles were goods for the purposes of the industry definition. They contended that because Truck Moves was a bailee for reward to convey the vehicles to the customer, the vehicles, as the goods bailed, were “goods” moved as freight for the purposes of the definition.

40    The two drivers contended that the RTD Award was expressed to cover Truck Moves’ business for the purposes of s 48(1) of the Act. They contended that the RTD Award should be construed so as to preserve its operation as regulating the road transport and distribution industry. They submitted that the ordinary meaning of “transport” given in the New Shorter Oxford Dictionary was to “move or carry from one place or person to another; convey across” and that the business of Truck Moves was to transport trucks and other motor vehicles by road from one location to another under a contract with its customers to do so.

41    The two drivers contended that paragraphs (d)-(i) of the industry definition were intended to avoid doubt and to ensure coverage of areas previously covered by multiple individual awards applying to a variety of sectors in the newly defined road transport and distribution industry. They argued that the transport and delivery of meat or cartage of petrol or bulk petroleum products in tankers would in any event be covered by paragraph (a) of the industry definition. And, they contended that cl 19 of the RTD Award ensured that whatever variety there may have been in the two drivers’ daily work, they would be remunerated at the highest applicable grade in Sch C for the relevant day. Moreover, the two drivers submitted that if Truck Moves were not covered by the RTD Award, its employees would have no award protection whatsoever and they would have no safety net (ZWS 23-24). They contended that, accordingly, Truck Moves’ business fell within the coverage of the RTD Award.

42    The two drivers also argued that because each of them had on occasion driven a truck that had a trailer or a load, Truck Moves’ business fell within the industry definition. They contended that Truck Moves’ use of trade plates as a necessary incident of its performance of its operations did not preclude the application of the definition to its business.

43    The two drivers argued that the Commission’s reasons for proposing the exposure draft of and final RTD Award demonstrated that it intended that the modern award would apply to, at least, the same industry as cl 6.1 of the Transport Workers Award 1998 and NAPSAs operating in each State. They contended that the pre-existing award coverage was broad enough, including having regard to s 143(7)(b) of the Act, to cover Truck Moves’ business and that, likewise, it was covered by the RTD Award.

44    The two drivers argued that in any event, the fact that Truck Moves, on occasion, had agreed to move loaded trucks for its customers, meant that that work was “ancillary to the principal business” within the meaning of paragraph (a) of the industry definition and so they were covered by the RTD Award.

Consideration – principles for construction of modern awards

45    Part 2-3 of the Act prescribes a process for the Commission to follow when it makes a modern award. The process requires the Commission to decide upon how the award will deal with the matters for which such an award may and must provide. The making of a modern award does not involve, as a necessary contextual element, the resolution of an industrial dispute between an individual employer and its employees, or an organisation or organisations representing one or particular employers or employees, or employers or employees in the relevant industry or trade.

46    The Commission’s functions under Pt 2-3 of the Act are unlike those exercised historically by its predecessors in the conciliation and arbitration of industrial disputes, although the Act contemplates that the Commission will have such or similar functions in other circumstances. Rather, under Pt 2-3, the Commission must undertake the task of formulating the terms of a general award that will regulate the relationship of employers and their employees nationally, so as to achieve the modern awards objective in respect of an entire industry or particular persons or classes of persons covered by the award (ss 134, 143).

47    The Act contemplates that a modern award will be made by the Commission under Pt 2-3 in terms that it, as opposed to disputant industrial parties, formulates to regulate identified industrial relationships generally in order to provide a fair and relevant minimum safety net of conditions in accordance with s 134. The function of making a modern award under Pt 2-3 must be exercised by a Full Bench of the Commission (s 616).

48    Siopis, Buchanan and Flick JJ held in Transport Workers’ Union of Australia v Coles Supermarkets Australia Pty Ltd (2014) 245 IR 449 at 455 [22] that the test for construing a modern award (indeed, in that case, the RTD Award):

is to discern the objective meaning of the words used bearing in mind the context in which they appear and the purpose they are intended to serve.

49    Their Honours noted that principles that had been used in times past to construe awards may be relevant to awards that reflect a form of bargain between agreeing parties and to other statutory processes made under other provisions of the Act, such as enterprise agreements under s 172 (245 IR at 458-461 [39]-[46]), adding (at [46]):

However, giving primacy to the text does not deny the importance of understanding the context in which an instrument is made, and which it is intended to address, nor the utility of bearing in mind the facts as they are known at the time the instrument is drafted.

50    This is similar to, but not exactly the same as, the task of statutory construction namely, as French CJ, Hayne, Crennan, Bell and Gageler JJ explained in Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503 at 519 [39]:

“This Court has stated on many occasions that the task of statutory construction must begin with a consideration of the [statutory] text” [Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at 46 [47]]. So must the task of statutory construction end. The statutory text must be considered in its context. That context includes legislative history and extrinsic materials. Understanding context has utility if, and in so far as, it assists in fixing the meaning of the statutory text. Legislative history and extrinsic materials cannot displace the meaning of the statutory text. Nor is their examination an end in itself.

51    The construction of a modern award requires the Court to ascertain the objective meaning of the relevant provision considered in the context of the instrument as a whole, the statutory provisions under which it was made and to which it seeks to give effect in light of the industrial context and background of which the Commission objectively may be taken to have been aware (cf too the approach to the construction of contracts in Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 at 656-657 [35] per French CJ, Hayne, Crennan and Kiefel JJ).

Consideration – the industry definition in the RTD Award

52    The natural and ordinary meaning of the noun “transport” is:

    the act or method of transporting or conveying [from one place to another] (Macquarie Dictionary online: sense 5);

    the action of carrying or conveying a thing or person from one place to another (Oxford English Dictionary online: sense 1a).

53    I am of opinion that the expression “the transport by road of goods” as used in paragraph (a) of the industry definition in the RTD Award means the carriage of goods by road and does not extend to the mere driving or ferrying of vehicles between locations.

54    That is because the definition, read as a whole in the context of the RTD Award and the circumstances in which it was made, including the RTLDO Award, identifies an industry that engages in the carriage and distribution of goods by road, as opposed to the mere driving of vehicles on roads. The qualifying words “of goods” distinguish the area of industrial activity caught by the initial words of paragraph (a) from the transport by road of passengers. The transport of goods and passengers are distinct and well understood forms of entrepreneurial activity that can be undertaken by road, sea or air.

55    A pilot who flies a plane could not be said to be engaged in the transportation of the plane itself. Rather, the plane is the means of transportation. So too, in the context of the RTD Award, the industry definition is intended to cover the means by which goods are carried from one place to another by road, but not to treat the vehicle of conveyance itself as the goods transported.

56    This construction is reinforced by the definitions of interstate operation and long distance operation together with the interrelationship of cl 4.2 between the RTD Award and the RTLDO Award. If the construction propounded by the two drivers were correct, it would mean that if one drove a vehicle that moved livestock or materials interstate then that would attract the operation of provisions in one of the two Awards dealing with interstate operations, but if the person drove an unladen vehicle on exactly the same route, those provisions would not apply. Yet, paragraph (a) of the industry definition also includes “the transport by road of … material … and/or livestock”, so that the RTD Award always would apply to an operation involving such carriage, unless cl 4.2 caused the RTLDO to apply to it. As McHugh, Gummow, Kirby and Hayne JJ said in Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 381-382 [69]-[70]:

The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute [Taylor v Public Service Board (NSW) (1976) 137 CLR 208 at 213, per Barwick CJ] . The meaning of the provision must be determined “by reference to the language of the instrument viewed as a whole” [Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation (1981) 147 CLR 297 at 320, per Mason and Wilson JJ. See also South West Water Authority v Rumble’s [1985] AC 609 at 617, per Lord Scarman, “in the context of the legislation read as a whole”]. In Commissioner for Railways (NSW) v Agalianos [(1955) 92 CLR 390 at 397], Dixon CJ pointed out that “the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed”. Thus, the process of construction must always begin by examining the context of the provision that is being construed [Toronto Suburban Railway Co v Toronto Corporation [1915] AC 590 at 597; Minister for Lands (NSW) v Jeremias (1917) 23 CLR 322 at 332; K & S Lake City Freighters Pty Ltd v Gordon & Gotch Ltd (1985) 157 CLR 309 at 312, per Gibbs CJ; at 315, per Mason J; at 321, per Deane J].

A legislative instrument must be construed on the prima facie basis that its provisions are intended to give effect to harmonious goals [Ross v The Queen (1979) 141 CLR 432 at 440, per Gibbs J]. (emphasis added)

57    While, “material” may be something different to “goods”, the general purpose and policy of the industry definition is to cover the carriage of all things that can be carried by road. Indeed, in its natural and ordinary meaning the word “goods” means “things that are produced for sale; commodities and manufactured items to be bought and sold; merchandise, wares … economic assets which have a tangible, physical form (contrasted with services” and “commodities, merchandise, etc., (as distinct from passengers) to be transported by road, rail, etc; freight” (Oxford English Dictionary online senses 10a and b). And, of course, in the final sense, the word “goods” is associated with carriage by rail by means of a goods train. Although a train is manufactured, no one would regard the expression ‘the transport by rail of goods” to refer to an empty goods train as goods or to its movement on rails as “the transport by rail of goods”.

58    It is likely that the Commission chose to set out the many examples of the possible categories of things that could be transported by road in paragraphs (a), (d), (f), (g) (h) and (i) of the industry definition because of the plethora of narrow, specialised and individual Commonwealth, State and Territory awards and other forms of industrial regulation that the two modern awards were replacing. And, as the Commission itself explained in its Decision [2009] AIRCFB 345 at [168], [171] promulgating the RTD Award, it had decided to add the qualification “by road” in paragraph (a) of the industry definition. It said that it had done this to “make it clear that the [new] award relates to the transport of goods etc by road”. Nothing in the Commission’s reasons there, or in its earlier Statement [2009] AIRCFB 50, suggested that it had in mind that either of the two Awards would cover a business of the kind operated by Truck Moves.

59    The use of etcetera after “goods” by the Commission at [168] suggests that it intended the word “transport” in the RTD Award to have the meaning at which I have arrived, namely “carriage” of goods and other things by road. And the insertion of “by road” in paragraph (a) had the effect of confining the operation of coverage to that form of transport, unlike the potentially wider reach of cll 6.1 and 7.1 of the supplanted Transport Workers Award 1998.

60    I also reject the two drivers’ argument that, because Truck Moves agreed from time to time on a one off basis to move a truck that had a load, this was “work performed [that] is ancillary to the principal business” of Truck Moves.

61    The evidence demonstrated that such occurrences were outside the ordinary business operations of Truck Moves and of an inherently occasional nature. Those occurrences were not essential or relevant to the support or the functioning of Truck Moves’ business. They did not play any substantive role in supporting that business. Therefore, I do not consider that the very small number of instances in which Truck Moves agreed that a driver would drive a truck to which a trailer was attached, or with a trailer or other load on its tray, involved the performance of work that was ancillary to its business. A total of 95 trailer movements over more than six years cannot be categorised as ancillary to a business that completed over 62,500 other vehicle movements in that period.

62    Nor does the inclusion of drivers of mobile cranes in the grades of transport worker in Sch C of the RTD Award support the construction of paragraph (a) in the industry definition for which the two drivers contended. Obviously, the business of an employer of such drivers would not involve merely moving such vehicles from place to place. The Commission recognised in its Decision [2009] AIRCFB 345 at [171] that the practical effect of the existing awards (that would be encompassed by the RTD Award) was that the supplanted awards operated by reference to a structure of types, models and classes of vehicle and to drivers of them.

63    I have found that the driving of a vehicle that comprises, or has as part of its structure, equipment, such as fitted broadcast or pipe lining equipment, or cranes, does not involve the transport by road of goods. That is because the equipment in those cases formed part of the vehicle itself.

64    The Commission made the Mobile Crane Hiring Award 2010 as a modern award at the same time as the RTD Award that broadly reflected the terms and conditions of the pre-existing Mobile Crane Hiring Award 2002: Decision [2009] AIRCFB 345 at [67], [114]-[126], esp at [114]. The Commission did not discuss in its Decision [2009] AIRCFB 345 why it also included drivers of cranes in the classifications in Sch C of the RTD Award. However, I am of opinion that it did so principally to cover employees who drove vehicles capable of loading and unloading their employers’ cargoes from trucks, as the inclusion of the definition of “truck loading crane” in cl 3.1 of the RTD Award would suggest. Such work of driving vehicles equipped with cranes to perform this task readily falls into the category of work that is ancillary to the employer’s principal business of carrying goods by road.

65    The RTD Award also dealt with allowances for employees who were “required to drive a motor vehicle with a truck loading crane mounted on the vehicle” (cl 16.2(b)(ii)) or a side lifter crane so mounted (cl 16.2(b)(iii)). Although there was no evidence as to why grade 9 in Sch C included the driver of a gantry crane, I infer that such cranes would be used to load and unload large and heavy loads such as machinery, prefabricated components of buildings, rails or pipes, that the employer transported by road, as ancillary and necessary work in carrying on its principal business.

66    Ordinarily, a person employed to drive mobile cranes who was not involved in the transport or distribution of goods by road would be covered by the specific modern award that the Commission made contemporaneously with the RTD Award, namely, the Mobile Crane Hiring Award 2010. As the Commission noted when it said (Decision [2009] AIRCFB 345 at [114]):

We have published a separate award for the mobile crane hiring industry – the Mobile Crane Hiring Award 2010. We accept there is a need for a separate award for the industry reflecting the existence of a distinct industry servicing a range of other industries. (emphasis added)

67    Accordingly, the presence in Sch C of classifications for drivers of mobile and gantry cranes does not suggest that the work performed by the two drivers as employees of Truck Moves was covered by the RTD Award.

68    I also reject the two drivers’ argument that, somehow, the bailment of the vehicles that Truck Moves’ drivers ferried between locations fell within paragraph (a) of the industry definition. The mere possession of the vehicle does not mean that the driver carried it by road: rather, he or she drove the vehicle while in possession of it in the same way as every person lawfully in possession of a vehicle does when he or she drives it on a road. That does not amount to the transport by road of a vehicle. The vehicle moves on the road and is not carried or transported by road.

69    In Rooth [2014] FCCA 1435 at [26], Judge Burchardt held that drivers working for a similar business to that of Truck Moves were covered by the RTD Award. He found that the work of the drivers in ferrying unregistered trucks and vehicles constituted the transport by road of goods, being those vehicles themselves.

70    For the reasons I have given, his Honour erred in so finding.

Conclusion

71    The “particular employment” of Truck Moves drivers, including Mr Simmonds and Mr Zader, whom the RTD Award covered for the purposes of ss 47(3) and 48(5) of the Act, was to ferry unladen trucks or other vehicles using, and subject to the conditions of use of, trade plates. It was not the carriage of goods by road. Truck Moves was involved in the industry of driving unladen trucks and vehicles on roads between places as specified by its customers. The RTD Award did not apply to the employment of Mr Simmonds and Mr Zader.

72    For these reasons, Truck Moves should be granted declaratory relief to reflect this position.

Associate:    

Dated:    2 October 2015