FEDERAL COURT OF AUSTRALIA Technical and Further Education Commission v Pykett (No 1) [2014] FCA 727 Citation: Technical and Further Education Commission v Pykett (No 1) [2014] FCA 727 Appeal from: Pykett v Technical and Further Education Commission T/A TAFE NSW [2014] FWC 3177 Parties: TECHNICAL AND FURTHER EDUCATION COMMISSION v LYNDA PYKETT and FAIR WORK COMMISSION File numbers: NSD 654 of 2014 Judge: PERRAM J Date of judgment: 4 July 2014 Catchwords: PRACTICE AND PROCEDURE – application for stay of orders of Fair Work Commission – inherent jurisdiction of the Court – whether there were exceptional circumstances that justified a stay being granted PRACTICE AND PROCEDURE – application for stay of orders of Fair Work Commission – where applicant submitted that orders breached Melbourne Corporation doctrine – circumspection required before granting interim relief on the basis of the constitutional invalidity of a statute Legislation: Fair Work Act 2009 (Cth) ss 385, 389 and 675 Federal Court of Australia Act 1976 (Cth) s 23 Judiciary Act 1903 (Cth) s 39B Cases cited: Anthony Smith & Associates Pty Ltd v Sinclair (1996) 67 IR 240 cited Blackadder v Ramsey Butchering Services Pty Ltd (2005) 221 CLR 539 cited Castlemaine Tooheys Ltd v South Australia (1986) 161 CLR 148 applied EnergyAustralia Yallourn Pty Ltd v CFMEU [2013] FCA 360 cited Re Australian Education Union; ex parte Victoria (1995) 184 CLR 188 considered Re Australian Industrial Relations Commission and CFMEU; ex parte Hail Creek Coal Pty Ltd [2003] FCAFC 322 cited Technical and Further Education Commission T/A TAFE NSW v Pykett [2014] FWCFB 714 cited Date of hearing: 2 July 2014 Date of last submissions: 3 July 2014 Place: Sydney Division: FAIR WORK DIVISION Category: Catchwords Number of paragraphs: 27 Counsel for the Applicant: Mr PM Kite SC and Mr B Miles Solicitor for the Applicant: Crown Solicitor's Office Counsel for the First Respondent: Mr M Gibian Solicitor for the First Respondent: W. G. McNally Jones Staff Lawyers Solicitor for the Second Respondent: The second respondent filed a submitting notice IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY FAIR WORK DIVISION NSD 654 of 2014 BETWEEN: TECHNICAL AND FURTHER EDUCATION COMMISSION Applicant AND: LYNDA PYKETT First Respondent FAIR WORK COMMISSION Second Respondent JUDGE: PERRAM J DATE OF ORDER: 4 JULY 2014 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The stay application be dismissed. 2. There be no order as to costs. 3. The stay granted by Justice Perram on 30 June 2014 be extended to 4 July 2014 at 6:00 pm. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY FAIR WORK DIVISION NSD 654 of 2014 BETWEEN: TECHNICAL AND FURTHER EDUCATION COMMISSION Applicant AND: LYNDA PYKETT First Respondent FAIR WORK COMMISSION Second Respondent JUDGE: PERRAM J DATE: 4 JULY 2014 PLACE: SYDNEY REASONS FOR JUDGMENT 1 This is an application for a stay of orders made by the Fair Work Commission ('the Commission') on 16 June 2014. On that day Commissioner McKenna ordered the applicant in this Court (who I will call 'TAFE') to appoint the applicant before the Commission (who I will call Ms Pykett) to a position of Technical Officer 1/2, Scientific, on terms and conditions no less favourable than those on which she had been employed immediately before her dismissal. I interpolate here that Ms Pykett's employment by TAFE was terminated on 26 October 2012 and she has not worked at TAFE, or elsewhere, since that time. I note however that since November 2013 TAFE has been paying Ms Pykett her salary and it continues to do so. 2 On 30 June 2014 TAFE commenced a proceeding in this Court's original jurisdiction to vacate by certiorari Commissioner McKenna's findings of 4 June 2014 and orders of 16 June 2014. Pending the substantive determination of those proceedings it seeks a stay of the orders. The orders in issue are as follows: '1. pursuant to ss.390 and 391(1)(b) of the Fair Work Act 2009 ("the Act"), the Technical and Further Education Commission T/A TAFE NSW ("TAFE") appoint Lynda Pykett to a position of Technical Officer 1/2, Scientific, on terms and conditions no less favourable than those on which she was employed immediately before the dismissal; and 2. the appointment is to occur within 21 days of the date of the decision in Lynda Pykett v Technical and Further Education Commission T/A TAFE NSW (No. 5) [2014] FWC 3177; and 3. pursuant to s.391(2) of the Act, TAFE treat the period of employment of Ms Pykett with TAFE to have not been broken by the dismissal and the period between dismissal and reinstatement shall be counted for all purposes as a period of employment; and 4. pursuant to s.391(3) of the Act, TAFE pay to Ms Pykett within 14 days an amount of $40,592.74 being the amount agreed between the parties for the purpose of these orders, as remuneration lost because of the dismissal.' 3 It will be seen that the reappointment of Ms Pykett was to occur, according to Order 2, within 21 days of the decision in Pykett (No. 5). That decision was reached on 4 June 2014 so that the effect was to require Ms Pykett's reappointment by Wednesday 25 June 2014. 4 TAFE did not so by 25 June 2014 or at all. Following correspondence between the solicitors for the parties, Ms Pykett indicated that she would present herself for work at TAFE's head office at 9 am on Friday 27 June 2014. On Thursday 26 June 2014, after 6 pm, the Crown Solicitor's Office indicated to Ms Pykett's solicitors that she was not required for work the next morning. The email communicating this also indicated that the solicitor ordinarily handling the file within the Crown Solicitor's Office was absent on leave. It was unnecessary for Ms Pykett to present herself for work because, so the Crown Solicitor's Office explained, it had received instructions to commence proceedings in this Court during the course of the following day and to seek at the same time a stay of Commissioner McKenna's orders. 5 As events transpired Ms Pykett did present herself to TAFE on Friday morning but was sent away. This was, of course, a continued breach of the Commission's orders in the sense that TAFE was required to have reappointed Ms Pykett by the Wednesday. 6 Section 675(1) of the Fair Work Act 2009 (Cth) provides: 675 Contravening an FWC order (1) A person commits an offence if: (a) the FWC has made an order under this Act; and (b) either of the following applies: (i) the order applies to the person; (ii) a term of the order applies to the person; and (c) the person engages in conduct; and (d) the conduct contravenes: (i) a term of the order referred to in subparagraph (b)(i); or (ii) the term referred to in subparagraph (b)(ii). … 7 This appears to give rise to a serious matter. What is involved is a deliberate decision to disobey an order of the Commission. As events transpired this Court was not approached until Monday of this week when I granted an interim stay pending the hearing of the present application on Wednesday. 8 I do not discount the difficulties which arose from the fact of the solicitor having the ordinary carriage of the matter being absent on leave but it remains nevertheless a very serious matter for a party, particularly a governmental party, simply to ignore an order of the Fair Work Commission. Further, once the difficulty was appreciated on the evening of Thursday, this Court should have been moved immediately and not, as happened, on Monday of the following week. 9 Because the application to this Court is for orders in the nature of certiorari and mandamus under s 39B of the Judiciary Act 1903 (Cth) the power to grant a stay is located in the Court's inherent jurisdiction to protect the subject of the lis before it. 10 Neither the Federal Court of Australia Act 1976 (Cth) nor the Federal Court Rules confer any express power to grant a stay of proceedings before an administrative tribunal such as the Commission. Authority establishes that this Court will only grant a stay of proceedings before the Commission, when its supervisory jurisdiction is involved, where there are shown to be exceptional circumstances: see Re Australian Industrial Relations Commission and CFMEU; ex parte Hail Creek Coal Pty Ltd [2003] FCAFC 322 at [2] per Lee, Goldberg and Weinberg JJ; EnergyAustralia Yallourn Pty Ltd v CFMEU [2013] FCA 360 at [33]-[38] per Murphy J. 11 TAFE submitted that this principle was inapplicable because the stay was sought pursuant to s 23 of the Federal Court of Australia Act rather than the inherent jurisdiction. I reject this argument. The inherent jurisdiction is an aspect of the power conferred by s 23. 12 What then are the exceptional circumstances put forward in support of its case for writs of certiorari and mandamus? TAFE advanced three arguments. The first argument is as follows: 13 Its case before the Commission was that Ms Pykett's position had become redundant. The Commission rejected this argument. It concluded in terms of the language of s 385 that Ms Pykett's dismissal had not been a case of genuine redundancy. 14 This was an expression defined in s 389(2) of the Fair Work Act as follows: '389 Meaning of genuine redundancy … (2) A person's dismissal was not a case of genuine redundancy if it would have been reasonable in all the circumstances for the person to be redeployed within: (a) the employer's enterprise; or (b) the enterprise of an associated entity of the employer.' 15 TAFE contended that this provision could not operate against it because of the doctrine in Melbourne Corporation that the Commonwealth may not legislate with respect to some of the operations of the States. This principle was fleshed out in a redundancy context by the High Court's decision in Re Australian Education Union; ex parte Victoria (1995) 184 CLR 188 at 232: 'At this point it is convenient to consider South Australia's argument based on impairment of a State's "integrity" or "autonomy". Although these concepts as applied to a State are by no means precise, they direct attention to aspects of a State's functions which are critical to its capacity to function as a government. It seems to us that critical to that capacity of a State is the government's right to determine the number and identity of the persons whom it wishes to employ, the term of appointment of such persons and, as well, the number and identity of the persons whom it wishes to dismiss with or without notice from its employment on redundancy grounds. An impairment of a State's rights in these respects would, in our view, constitute an infringement of the implied limitation. On this view, the prescription by a federal award of minimum wages and working conditions would not infringe the implied limitation, at least if it takes appropriate account of any special functions or responsibilities which attach to the employees in question. There may be a question, in some areas of employment, whether an award regulating promotion and transfer would amount to an infringement. That is a question which need not be considered. As with other provisions in a comprehensive award, the answer would turn on matters of degree, including the character and responsibilities of the employee. In our view, also critical to a State's capacity to function as a government is its ability, not only to determine the number and identity of those whom it wishes to engage at the higher levels of government, but also to determine the terms and conditions on which those persons shall be engaged. Hence, Ministers, ministerial assistants and advisers, heads of departments and high level statutory office holders, parliamentary officers and judges would clearly fall within this group. The implied limitation would protect the States from the exercise by the Commission of power to fix minimum wages and working conditions in respect of such persons and possibly others as well (216). And, in any event, Ministers and judges are not employees of a State.' 16 It was therefore said that s 389(2) could not apply to TAFE, or could not result in orders which had that effect. 17 I accept, at least, that the former is arguable. 18 TAFE's second and third arguments were essentially the same. These were that the Commissioner was required to identify and establish a position into which Ms Pykett was to be placed under s 389(2). This proposition was rejected by the Full Bench of the Commission in an earlier appeal from Commissioner McKenna: see Technical and Further Education Commission T/A TAFE NSW v Pykett [2014] FWCFB 714 at [53]. The resolution of that debate depends upon whether one thinks the High Court's decision in Blackadder v Ramsey Butchering Services Pty Ltd (2005) 221 CLR 539 has undermined the authority of Anthony Smith & Associates Pty Ltd v Sinclair (1996) 67 IR 240 on this issue. 19 I accept, again, that TAFE has an arguable case on these points. 20 I therefore accept that the applicant has a proper case for determination in this Court. I propose, however, to give less weight to the constitutional argument. Although TAFE denied that it was saying that s 389(2) was invalid in relation to its operation on TAFE, submitting instead that what was invalid were the orders made by Commissioner McKenna, I do not accept this. In truth the argument is that the orders were ultra vires to the Act because s 389(2) is invalid. If s 389(2) is valid, then the orders of the Commission will necessarily also be valid. 21 This means that the principle in Castlemaine Tooheys Ltd v South Australia (1986) 161 CLR 148 at 154 is applicable. It suggests that ordinarily considerable circumspection is required before granting interim relief on the basis of the constitutional invalidity of a statute. 22 Even so, I shall accept that TAFE has an arguable case for relief, although not an overwhelming one. 23 It seems to me that the balance of convenience is against TAFE. It argued that unless a stay were granted it would be required to place Ms Pykett in a position which did not exist. I am not sure this is consistent with the facts found by Commissioner McKenna, which seemed to be to the contrary despite the arguments of Mr Kite SC for TAFE. 24 But regardless, I do not think that giving Ms Pykett paid employment during this case is a significant form of prejudice even if the position does not exist. I reject also TAFE's argument that it was exposed to prejudice arising from ambiguity in Order 1. That ambiguity was being required to guess what 'conditions which were no less favourable' might mean. I do so because I do not see any particular difficulty in interpreting those words. Further, I do not accept that TAFE is especially concerned about disobeying Commission orders in light of the events that have led up to the current stay application. 25 For Ms Pykett, on the other hand, the prejudice is clear. Although she is currently being paid, she has not worked for almost two years, despite wanting to remain in employment. 26 In those circumstances, I do not find exceptional circumstances exist which justify the grant of a stay. Even if a lower standard which is applicable in the case of applications for interlocutory injunctions or stays in this Court's appellate jurisdiction were to be applied, I would reach the same conclusion. Although there is an arguable case for relief, the balance of convenience plainly does not favour TAFE. Finally, even if I had otherwise been satisfied that TAFE was entitled to a stay, I would refuse the application due to its delay in applying. 27 The order was made by Commissioner McKenna on 16 June 2014. It was at that time that TAFE should have moved. Waiting for two weeks, until such time as it had already committed an offence under the Fair Work Act, was a delay which is simply inexcusable in an application such as the present, where urgent relief is sought. I dismiss the application. I make no order as to costs. I continue the stay to 6 pm today, so that TAFE's obligation to engage Ms Pykett does not fall on a partial day. I certify that the preceding twenty-seven (27) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Perram. Associate: Dated: 9 July 2014