Industrial Relations Commission of New South Wales in Court Session CITATION : Irris Makler v Australian Broadcasting Corporation [2001] NSWIRComm 83 APPLICANT: Irris Makler PARTIES : RESPONDENT: Australian Broadcasting Corporation FILE NUMBER: IRC 2296 of 2001 CORAM: Glynn J CATCHWORDS : Unfair contract - applicant employed by Australian Broadcasting Corporation - motion by ABC to dismiss application for want of jurisdiction - inconsistency claimed between s 106 of the Industrial Relations Act 1996 and s 109 of the Australian Constitution - motion by applicant seeking interlocutory relief restraining the ABC from recalling her from Moscow - motion of ABC upheld - motion of applicant dismissed to extent it was before the Commission as presently constituted. Industrial Relations Act 1996 s 105 s 106 LEGISLATION CITED : Australian Broadcasting Corporation Act 1983 s 10 s 32 Australian Constitution s 109 Australian Broadcasting Commission v Industrial Court of South Australia and Anor (1976-1977) 138 CLR 399 Ex parte McLean (1930) 43 CLR 472 Harrison v Australian Meat and Livestock Corporation (unreported) [1993] NSWIRComm 87, 24/11/93 Hudson v Qantas Airways Limited (1985) 10 IR 331 Jackson v Sterling Industries (1987) 162 CLR 612 CASES CITED : Metal Trades Industry Association of Australia v Amalgamated Metal Workers' and Shipwrights' Union (1983) 152 CLR 632 McGowan v Australian Broadcasting Corporation (unreported) [2001] NSWIRComm 49, 30/3/01 Pelechowski v The Registrar (1999) 198 CLR 435 Reich v Client Server Professionals of Australia Pty Ltd (Administrator Appointed) (2000) 99 IR 69 Robert Alan Dawson v Telstra Corporation Limited (unreported) [1998] NSWIRComm 236, 29/5/98 Telstra v Worthing and Anor (1999) 197 CLR 61 Victoria v The Commonwealth (1937) 58 CLR 618 HEARING DATES: 04/09/2001; 04/12/2001 DATE OF JUDGMENT: 04/27/2001 APPLICANT: Mr D Robinson of counsel SOLICITORS: Mr A Salgo Baker & McKenzie LEGAL REPRESENTATIVES: RESPONDENT: Mr H Dixon of counsel SOLICITORS: Ms H McKenzie Blake Dawson Waldron JUDGMENT: - 12 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION CORAM: GLYNN J 27 APRIL 2001 MATTER NO. IRC2296 OF 2001 IRRIS MAKLER v AUSTRALIAN BROADCASTING CORPORATION Application under section 106 of the Industrial Relations Act 1996. INTERLOCUTORY JUDGMENT 1 Irris Makler (the applicant) has made an application pursuant to s 105 and s 106 of the Industrial Relations Act 1996 (the 1996 Act) for orders against the Australian Broadcasting Corporation (the respondent/ABC) in relation to a contract under which the respondent employed the applicant to perform work in the radio and television broadcasting industry. 2 The applicant has been a journalist since 1986. She has worked in Australia and overseas in the public and the private sectors in a number of capacities including that of correspondent and producer. 3 Her current position in which she is employed by the respondent is that of Overseas Correspondent, Moscow. Her employment there commenced on 16 January 2000. She was advised on 17 January 2001 that she was to be recalled as Moscow Correspondent before 31 March 2001. That date was later extended to 21 April 2001. (After decision in this matter was reserved, that date was further extended to 5 May 2001.) 4 The applicant alleges that the contract or arrangement, related condition or collateral arrangement, is unfair in terms of s 105 of the 1996 Act and seeks that the contract or arrangement etc be varied by the inclusion in it of a number of provisions seeking to regulate any requirement by the respondent that the applicant should relocate to Sydney from her present position in Moscow. 5 This application was filed on 28 March 2001 and was allocated in the first instance to Schmidt J who dealt with an accompanying Notice of Motion to the extent she could in the short period available to her. 6 The Court as now presently constituted has before it a portion of the Notice of Motion filed by the applicant, and another filed by the respondent. 7 In this decision I shall refer to the applicant and to the respondent on the basis of their status in the substantive proceedings, rather than to their roles as applicant for and/or respondent to the two Notices of Motion. 8 That part of the applicant's Notice of Motion before the Court in these proceedings is that by which she seeks an interlocutory injunction restraining the respondent from recalling or purporting to recall her from Moscow without further order, or prior to 15 January 2002, with such date to be after the date referred to in order (2), [i.e. a date for conciliation pursuant to s 109] but before 21 April 2001. 9 The respondent in its Notice of Motion seeks orders that the summons filed by the applicant in the proceedings be struck out and for payment of costs. 10 The parties' primary submissions were directed to different aspects of the Court's jurisdiction. 11 It was the respondent's primary submission that the Commission was not seized of jurisdiction to decide the applicant's application in any respect because of inconsistency between s 106 of the 1996 Act and s 109 of the Australian Constitution. 12 On the other hand, the applicant argues that the Commission not only has the jurisdiction to grant the relief sought, but also has the jurisdiction to grant interlocutory relief in the injunctive form sought by it (a claim also rejected by the respondent). 13 It is obvious that if the respondent's submission succeeds, then it will not be open to the Commission to examine the applicant's claim for injunctive relief. I therefore deal first with the respondent's Notice of Motion. 14 In the light of my decision and in view of the urgency to advise of the Court's decision as early as possible even with the benefit of the extended deadline, I set out a truncated version only of the parties' submissions as to jurisdiction. Whether set out or not they have all been considered. Submissions - Jurisdiction - Respondent 15 The grounds and reasons advanced by Mr H Dixon of counsel on behalf of the respondent to support its Notice of Motion were: 1. The Commission is without jurisdiction to grant the relief claimed by the Applicant in the proceedings, (Respondent to this motion) in her Summons for Relief pursuant to section 106 of the Industrial Relations Act 1996 (NSW), such jurisdiction being excluded by operation of section 109 of the Constitution. 2. Each of the orders sought by the Applicant in the proceedings, (Respondent to this motion), in her Summons for Relief requires of the Commission the exercise of powers under a State law inconsistent and/or in conflict with and/or which impair or detract from the operation of the rights and obligations contained in the [sic] section 32 of the Australian Broadcasting Corporation Act 1983 (Cth). 16 A third ground based on the existence of an award or certified agreement of the Australian Industrial Relations Commission was not pressed at this time, it being noted by Mr Dixon that that argument was an argument that is available to the respondent should the Court in these proceedings decide against the ABC on its present application. 17 The respondent, the Australian Broadcasting Corporation (the ABC), is a body corporate that is in existence by virtue of s 30 of the Broadcasting Television Act 1932 (Cth) and which continues its existence under the Australian Broadcasting Corporation Act 1983, (Cth) (the ABC Act) as amended. 18 Section 32(2) of the ABC Act invests the ABC with the unfettered power to determine the terms and conditions of employment of its employees. That power is in the exclusive province of the ABC Act. 19 The powers conferred by s 32 of the ABC Act are plenary in nature and raise an inconsistency with s 109 of the Constitution, such that any orders made by the Commission in these proceedings would be inconsistent with the scope of those powers and are inoperative. [This submission is taken exactly from the respondent's written submissions.] 20 The relief sought by the applicant requires the Commission to exercise powers under Part 9, Division 2 of the Industrial Relations Act 1996 (NSW) which are directly inconsistent and/or in conflict with and/or which impair or detract from the operation of the rights and obligations conferred on the ABC pursuant to the ABC Act. The inconsistency in this case is both direct and indirect and is patent. It is of the kind which renders the operation of the State law invalid. The position falls squarely within the oft recognised dicta of Dixon J in Victoria v The Commonwealth (1937) 58 CLR 618 at 630. 21 Pursuant to the provisions of s 32, the Corporation has exercised its powers to engage employees, including the applicant, and has determined the terms and conditions of employment upon which she, and they, are employed. 22 The terms and conditions of employment determined by the ABC for the applicant from time to time are those contained in written agreements made between the applicant and the ABC, including agreements dated 21 July 1999, 22 November 1999 and 6 December 1999 and a determination made by the Corporation on 6 April 2001. 23 The respondent relied upon the line of authority represented by the following decisions to support its submissions as to the lack of jurisdiction in the Commission to grant the relief sought: McGowan v Australian Broadcasting Corporation ( McGowan ) (unreported) [2001 NSWIRComm 49, 30 March 2001. Australian Broadcasting Commission v Industrial Court of South Australia and Anor (1976-1977) 138 CLR 399. Telstra v Worthing and Anor ( Worthing ) (1999) 197 CLR 61. Robert Alan Dawson v Telstra Corporation Limited ( Dawson ) (unreported) [1998] NSWIRComm 236, 29 May 1998. Harrison v Australian Meat and Livestock Corporation (unreported) [1993] NSWIRComm 87, 24 November 1993. Victoria v The Commonwealth (1937) 58 CLR 618. Ex parte McLean (1930) 43 CLR 472 and Metal Trades Industry Association of Australia v Amalgamated Metal Workers' and Shipwrights' Union (1983) 152 CLR 632. Submissions - Jurisdiction - Applicant 24 The grounds and reasons supporting the applicant's Notice of Motion canvassed the applicant's background in the radio and television industry and, in particular, the events both leading up to her appointment as Moscow Correspondent by the respondent and those relating to her being advised by the respondent of her recall from that post. 25 As to jurisdiction, the applicant, represented by Mr D Robinson of counsel, submitted that: 1. The Commission has jurisdiction to determine Makler's Aplication. Jurisdiction is authority to decide. ( Pelechowski v The Registrar (1999) 198 CLR 435 at 459; Jackson v Sterling Industries (1987) 162 CLR 612 at 627.) 2. It is clear that the Applicant has invoked the jurisdiction of the Industrial Relations Commission in Court Session claiming an unfair contract and seeking relief which the Commission in Court Session has authority to grant. … 6. No evidence of the Corporation making a determination under s 32 of the terms and conditions of the Applicants employment has been led by the Respondent (see s 10(3) and s 32). 7. As a matter of construction the section only applies to regulate the terms and conditions of employment. 8. Ms Makler's complaint is outside of the field covered by s 32. It is a complaint not about the terms and conditions of employment but of an "arrangement, related condition or collateral arrangement" as those words are used in s 105 of the Industrial Relations Act 1996. This point is more fully developed in Reich v Client Server Professionals (2000) 49 NSWLR 551 at 561. 9. The cases of Robert Alan Dawson v Telstra Corporation Limited (unreported, [1998] NSWIRComm 236, 25 May 1998) and McGowan v Australian Broadcasting Corporation (unreported, [2001] NSWIRComm 49, 30 March 2001) are both distinguishable, although for slightly different reasons. Consideration 26 The starting point for consideration is s 32 of the Australian Broadcasting Corporation Act 1983 (the ABC Act) which provides that: (1) The Corporation may engage such employees as are necessary for the performance of its functions and the exercise of its powers. (2) The terms and conditions of employment shall be determined by the Corporation. 27 Section 10 of the ABC Act as set out in McGowan (at 17-18) is in the following terms: 10 Duties of the Managing Director (1) The affairs of the Corporation shall, subject to subsection (2), be managed by the Managing Director. (2) The Managing Director shall, in managing any of the affairs of the Corporation and in exercising any powers conferred on him or her by this Act, act in accordance with any policies determined, and any directions given to him or her, by the Board. (3) All acts and things done in the name of, or on behalf of, the Corporation by the Managing Director shall be taken to have been done by the Corporation. 28 The decision of Peterson J in McGowan was the subject of strong submissions by both counsel. In that case, Hugh McGowan commenced proceedings under s 106 against his employer, the ABC, seeking various orders and declarations, including compensatory relief, in relation to an alleged unfair contract of employment between himself and the ABC. In an interlocutory judgment delivered on 30 March 2001, Peterson J upheld the submissions of the ABC that this Commission is without jurisdiction to grant the relief claimed by Mr McGowan pursuant to s 106, such jurisdiction being excluded by operation of s 109 of the Australian Constitution. 29 Apart from the changes made necessary by there being a different applicant, the grounds and reasons advanced by the ABC in McGowan in relation to the jurisdictional argument, are identical to those advanced by it in these proceedings. However, one difference between this case and McGowan, is that the respondent, in this case, did not press the alternative third ground set out in its Notice of Motion, that relating to the existence of an award or certified agreement of the AIRC. 30 The applicant rejected what it says was the respondent's submission, that submission being that pars 1 - 57 of McGowan set out the proper ambit of s 32 of the ABC Act, and, in so doing, completely block out relief for the applicant. In par 57 of McGowan, Peterson J had found that those parts of the relief there sought which seek to amend the contractual terms and so the obligations arising under the contract of employment must be viewed as beyond jurisdiction. 31 The applicant submitted that the ambit of s 32 was to engage employees and set terms and conditions of employment, but claimed that s 32 does not necessarily apply to every aspect of conditions of employment. It permits the engagement of employees on terms and conditions determined by the Corporation. It does not permit repudiation of contracts. It does not permit unilateral changes to the terms and conditions by which employees are engaged. Its proper ambit is properly dealt with as a matter of construction by looking at s 32(1) and then looking at s 32(2) in light of that. 32 The applicant distinguished McGowan, pointing out that in this case, the applicant was not seeking monetary orders. 33 Mr Robinson drew attention in particular to pars 58 - 60 of McGowan, relying on what was said by Peterson J in those paragraphs to support a submission that there was a residual capacity for an order to be made under s 106: However, there remains a question whether such a contract which may not in terms be variable at the instance of the litigant under s 106, may nevertheless be made relevantly unfair by the conduct of one party. … It would not be inconsistent with either the terms of the agreement or the provisions of s 32(2) of the ABC Act that the consequences of conduct held to be unfair which did not impact upon the express terms of the employment agreement be dealt with here, providing there is a statutory power so to do provided by s 106. (par 58) This question involves the issue whether there is any room left for s 106 to operate not in relation to an amendment of the terms of employment but solely in relation to the alleged repudiatory conduct of the ABC and other, consequential matters such as compensation for loss of opportunity, disappointment, distress, frustration, humiliation and upset. … In considering that subject matter, repudiatory conduct was referred to by the Full Bench in Reich v Client Server Professionals of Australia Pty Ltd (Administrator Appointed) (2000) 99 IR 69 at p 77. … It follows that, should the evidence establish repudiation, as it appears to do on its face in this uncontested evidentiary stage, the case would arguably come within the scope of what I might call 'conduct unfairness'. (par 59) However, as I understand s 106, there remains an obstacle which must defeat the summons. That is, by s 106(5), the power to make an order for the payment of money depends upon an underpinning order which affects "any contract declared wholly or partly void, or varied …". If the Court is unable, as the result of the constitutional protection afforded to a determination of the ABC, to make an order voiding in whole or in part or varying the contract, no order for a money payment can be made (See Reich at 83.1). Accordingly, conduct unfairness can, in a case such as this, give rise to no remedy. (par 60) 34 That submission does not, in my view, assist the applicant. 35 The essence of the orders sought by the applicant was contained in par 3A of the Amended Summons for Relief, handed up in Court on 9 April 2001. 36 Claim 3A seeks: An order declaring the arrangement, related condition or collateral arrangement void from 17 January 2001 whereby the Respondent directed the Applicant to return from her posting in Moscow on 31 March 2001 (or as later extended to 21 April 2001). 37 The relief the applicant here seeks is to vary existing terms and conditions of employment. No monetary claim is made. That being so, pars 58-60 of McGowan are not relevant to the present consideration. 38 The applicant contended that the application of s 32 had been easier to determine in McGowan because, in that case, Mr McGowan's written contracts of employment had been signed by the Managing Director (see s 10 of the ABC Act). In this case, the applicant accepted that the offers by the respondent in the November and December letters were contracts of employment, but submitted that they were not contract determinations in terms of s 32 of the ABC Act. They had not been signed and executed by the Managing Director. There was no proof of delegation to the signatories of the letters or of the "determination" of 6 April 2001. 39 As to that point, the respondent stressed that the applicant had not suggested that the November 1999 and December 1999 letters were not valid agreements, and had in fact relied upon them. It had not been suggested that those ABC officers involved did not have the authority of the Corporation so to act. All that the Court has to be satisfied of, is that, if those letters are valid, that they constitute "determinations" of terms and conditions under s 32. 40 The verb "to determine" (ABC Act s 32(2) ) has a number of meanings, as is shown by reference to the Macquarie Dictionary, 2nd ed. The first definition there given is "to settle or decide (a dispute, question etc) by an authoritative decision". The tenth definition is "to come to a decision or resolution; decide". The term "determine" is not defined in the ABC Act. In the absence of definition, I see no reason why the term should be given the narrow and specialised meaning contended for by the applicant. 41 Insofar as are relevant to that particular matter, Peterson J decided: 54. The first issue in this context is whether there is evidence of a determination by the ABC of the terms and conditions of employment of Mr McGowan, or any relevant industrial instrument, with which an inconsistency arises. 55. The written employment agreement operating at the time of termination is in evidence. There is nothing on its face which suggests the agreement is a "determination", but s 32(2) of the ABC Act merely provides the terms and conditions of employment "shall be determined by the Corporation". While Mr Moses submitted that the evidence is not conclusive on this point, I consider that there can be no doubting the written employment agreement conforms with that requirement. … 56. In these circumstances, the conclusion is inevitable that aspects of the relief sought would raise a direct inconsistency with the power exercised pursuant to s 32 of the ABC Act … 57. It seems to me that the authorities are clear that an attempt to invoke the Commission's jurisdiction to vary a contract which constitutes a determination of the kind provided for by s 32 of the ABC Act directly impinges upon and is inconsistent with a law of the Commonwealth (See Dawson ). Those parts of the relief sought in these proceedings which seek to amend the contractual terms and so the obligations arising under the contract of employment, I consider must be viewed as beyond jurisdiction. … 42 I concur with the approach taken by Peterson J to the term "determination" in s 32(2). 43 Section 109 of the Constitution provides: When a law of a State is inconsistent with a law of the Commonwealth, the latter shall prevail, and the former shall to the extent of the inconsistency, be invalid. 44 In Worthing (197 CLR at par 28) the High Court said: In Victoria v The Commonwealth (63), [(1937) 58 CLR 618 at 630] Dixon J stated two propositions which are presently material. The first was: "When a State law, if valid, would alter, impair or detract from the operation of a law of the Commonwealth Parliament, then to that extent it is invalid." The second, which followed immediately in the same passage, was: "Moreover, if it appears from the terms, the nature or the subject matter of a Federal enactment that it was intended as a complete statement of the law governing a particular matter or set of rights and duties, then for a State law to regulate or apply to the same matter or relation is regarded as a detraction from the full operation of the Commonwealth law and so as inconsistent." The second proposition may apply in a given case where the first does not, yet, contrary to the approach taken in the Court of Appeal, if the first proposition applies, then s 109 of the Constitution operates even if, and without the occasion to consider whether, the second proposition applies. 45 The conclusions of Peterson J in McGowan are set out in pars 46 to 57. In coming to those conclusions, he took into account a number of the same authorities as to the jurisdictional issue that were relied upon, and have been taken into account, in these proceedings: Hudson v Qantas Airways Limited [(1985) 10 IR 331]; Victoria v The Commonwealth [(1937) 58 CLR 618 at 630]; Dawson v Telstra Corporation Limited [unreported; Peterson J; IRC96/5521; 29/5/98] and Australian Broadcasting Commission v The Industrial Court of South Australia [(1976-77) 138 CLR 399]. I adopt those conclusions. 46 Section 32(2) of the ABC Act states that "the terms and conditions of employment shall be determined by the Corporation". No limitation is placed on that power, nor is there anything in the way that it is expressed that would suggest it did not necessarily apply to every aspect of conditions of employment, that being a contention of the applicant. 47 I have difficulty seeing that the location to which employees are directed to undertake the work for which they are employed and the duration of that employment are other than matters which fall within the "terms and conditions of employment", in terms of s 32(2). 48 I find that the November and December 1999 letters and that of 6 April 2001 are determinations under s 32. They determine "terms and conditions", namely, the occupancy by the applicant of the position of Moscow Correspondent for the period 16 January 2000 to 15 January 2001. That being so, for this Court to vary or avoid those terms and conditions under s 106 of the 1996 Act would constitute a direct inconsistency with s 32 of the ABC Act. 49 On that basis I also find that the interlocutory relief sought by the applicant to vary the contract of employment between the respondent and herself as embodied in the November 1999 and December 1999 letters and in the document dated 6 April 2001 in relation to relocation of position and its duration, is beyond the jurisdiction of this Court to grant. I make no finding as to whether the Court would otherwise have the jurisdiction to grant the relief sought. 50 In relation to the Notice of Motion filed by the respondent, the Court orders: 1. The summons filed in the proceedings by the applicant be struck out. 51 The Court dismisses the Notice of Motion filed by the applicant on 28 March 2001, as to the order specifically sought in these proceedings, that being that the Court make an interlocutory injunction restraining the respondent from recalling or purporting to recall the applicant from Moscow before 21 April 2001. 52 The parties are to confer as to costs. In the light of the fact that there has already been some progression of the two Notices of Motion before Schmidt J, I leave it open to the parties to seek to make submissions to the Commission, however constituted, in the event that agreement as to costs cannot be reached. ************** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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