Industrial Relations Commission of New South Wales CITATION : State Rail Authority Firefighters Award 2001, Re [2002] NSWIRComm 159 APPELLANT New South Wales Fire Brigade Employees' Union PARTIES : RESPONDENT State Rail Authority of New South Wales FILE NUMBER: IRC 8497 of 2001 CORAM: Wright J President; Walton J Vice-President; O'Neill C Appeal - Award - Award interpretation - Leave to appeal - Appeal against a decision of Deputy President staying award application - Stay granted because of conflicting federal award - Whether federal award applied to subject classfication - Approach to be adopted - Principles of award interpretation - Maxim "ut res magis valeat quam pereat" - Principles of beneficial or remedial construction - Leave to appeal granted - Appeal dismissed CATCHWORDS : Award - Award interpretation - Appeal - Leave to appeal - Appeal against a decision of Deputy President staying award application - Stay granted because of conflicting federal award - Whether federal award applied to subject classfication - Approach to be adopted - Principles of award interpretation - Maxim "ut res magis valeat quam pereat" - Principles of beneficial or remedial construction - Leave to appeal granted - Appeal dismissed Award interpretation - Appeal - Leave to appeal - Appeal against a decision of Deputy President staying award application - Stay granted because of conflicting federal award - Whether federal award applied to subject classfication - Approach to be adopted - Principles of award interpretation - Maxim "ut res magis valeat quam pereat" - Principles of beneficial or remedial construction - Leave to appeal granted - Appeal dismissed Government and Related Employees Appeal Tribunal Act 1980 s 20 s 21 LEGISLATION CITED : Industrial Relations Act 1996 s 188 s 191 s 192 Workplace Relations Act 1996 (Cth) s 152 s 170LZ Blackley v Devondale Cream (Vic) Pty Ltd (1967) 117 CLR 253 Bryce v Apperley (1998) 82 IR 448 Clyde Engineering Co Ltd v Cowburn (1926) 37 CLR 466 Cole v Director-General of Department of Youth and Community Services (1987) 7 NSWLR 543 Comdox (No 272) Pty Limited (t/as Ronald Stead Golf) v Dawson (1993) 49 IR 458 CSR Limited Officers' Association v CSR Limited (1997) 76 IR 310 Elconnex Pty Limited v Gerard Industries Pty Limited (1991) 105 ALR 247 CASES CITED : Kingmill Australia Pty Ltd t/as Thrifty Car Rental v Federated Clerks Union of Australia, New South Wales Branch (2001) 106 IR 217 Knowles v The Anglican Property Trust (No 2) (1999) 95 IR 380 Martin v Scribal Pty Ltd (1954) 92 CLR 17 Nestle Australia Limited and Jim Patatou ((unreported, Fisher P, Cullen J and Connor CC, IRC92/2492, 16 July 1993) Nokes v Doncaster Amalgamated Collieries Limited [1940] AC 1014 R v Portus, Ex parte City of Perth (1973) 129 CLR 312 San Remo (Southland) Pty Ltd v Farrell (1987) 22 IR 291 State Rail Authority Fire Fighters Award 2000, Re [2001] NSWIRComm 310 Wright v Gibbons (1948) 78 CLR 313 HEARING DATES: 04/17/2002 DATE OF JUDGMENT: 12/20/2002 APPELLANT Mr J H Pearce of counsel (Mr G Maniatis, New South Wales Fire Brigade Employees' Union) RESPONDENT LEGAL REPRESENTATIVES: Mr R F Crow of counsel (Mr K Mackie, State Rail Authority of NSW Ms L Carruthers Australian Rail Tram Bus Industry Union JUDGMENT: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES FULL BENCH CORAM: WRIGHT J, President WALTON J, Vice President O'NEILL C Friday 20 December 2002 Matter No IRC 8497 of 2001 STATE RAIL AUTHORITY FIREFIGHTERS' AWARD 2001 Application for leave to appeal and appeal by the New South Wales Fire Brigade Employees' Union against a decision of Deputy President Grayson given on 31 December 2001 in Matter No IRC 5001 of 2000 DECISION OF THE COMMISSION [2002] NSWIRComm 159 1 This matter involves an application for leave to appeal and, subject to leave being granted, an appeal by the New South Wales Fire Brigade Employees' Union against a decision of Grayson DP given on 3 December 2001: Re State Rail Authority Fire Fighters Award 2000 [2001] NSWIRComm 310, in which it was held that the appellant's application for a new award should be stayed indefinitely on the basis that the Commission could not make an operative and valid award due to inconsistency with existing federal instruments. 2 The appellant had originally made an application pursuant to s 11 of the Industrial Relations Act 1996 for the making of a new award to be known as the State Rail Authority Fire Fighters Award. The award was to cover employees engaged in the Fire Protection Unit (the FPU) of the respondent to the appeal, the State Rail Authority of New South Wales (SRA). By motion filed 3 April 2000, the SRA sought to have the proceedings permanently stayed on the grounds that the employees to be covered by the proposed award were already covered by a number of federal awards and agreements, and therefore, any award made by this Commission would be invalid and inoperative by reason of s 109 of the Constitution and ss 152 and 170LZ of the Workplace Relations Act 1996 (Cth). For this reason also, it was said that the making of the proposed Award would be against the public interest. 3 The Federal instruments said to cover the employees are as follows: (a) Salaried Officers Award 1955 (b) State Rail Authority of New South Wales Enterprise Agreement 1992 ("the 1992 Agreement") (c) State Rail Authority of New South Wales Enterprise Agreement 1994 ("the 1994 Agreement") (d) State Rail Authority of New South Wales Enterprise Agreement 1996 ("the 1996 Agreement") (e) State Rail Authority of New South Wales Enterprise Agreement 1997 ("the 1997 Agreement") (f) State Rail Authority of New South Wales Enterprise Agreement, 1999 Towards 2000 ("the 1999 Agreement") 4 The history of the employees and the FPU may be briefly stated as one involving a number of reviews, alterations and recommendations. An appropriate starting point is the review conducted in 1988 which resulted in the new classification of Senior Fire Equipment Officer being inserted into the Salaried Officers Award 1955. The duty statement attached to the classification described the duties of the Senior Fire Equipment Officer as including supervision and testing of fixed installations in compliance with the required standards and regulations, the supervision of certain staff to maintain thermal and sprinkler installations, fire hydrants and power and water supplied to fire hydrants, assistance to the Fire Protection Manager and investigations and reporting in relation to causes of fire and other emergency situations. 5 Further reviews were carried out in 1991, 1996 and 1999. The 1991 review recommended the decentralisation of the FPU and reallocated the positions to other business units of the respondent. The 1996 review resulted in the re-establishment of a centralised FPU with responsibility for incident co-ordination, consultancy to external agencies, equipment installation and maintenance, training and inspections of all premises of the respondent for compliance with safety standards and the inspection of fire fighting equipment. The 1999 review, carried out by an organisation independent of the respondent, made certain recommendations which led to the abolition of the FPU and the reallocation of staff to other positions. 6 The final outcome of the 1999 review was to establish a small unit consisting of one manager classified as Senior Officer Class 6 under the federal Senior Officer Award 1977 and other staff classified as Senior Fire Equipment Officers under the Salaried Officers Award, with the subsequent enterprise agreements referring back to that classification. The challenged decision 7 The case put before Grayson DP on behalf of the SRA was that the duties of the employees to be covered by the proposed award were the same as those set out in the duty statement attached to the classification of Senior Fire Equipment Officer in the Salaried Officers Award. His Honour thereby approached the issue before him by examining the current duties of FPU employees and comparing them to those described in the Senior Fire Equipment Officer duty statement. His Honour found that although some changes had occurred over time, the primary function or principal purpose of the employees remained relatively unchanged and the current duties had the same purpose and function as they did in 1989. These duties including checking the functioning of fire protection equipment, providing training and protection to the respondent's staff and assisting the NSW Fire Brigade in emergency situations. 8 His Honour also agreed with the submissions of the SRA to the effect that the Unit's current managerial role engaged in the same duties and activities as that set out in the relevant federal award, namely the Senior Officer Award 1977. His Honour further agreed with the SRA that changes the appellant claimed had occurred in the position of Senior Fire Equipment Officer were changes going to work value rather than the applicability of the Award. 9 The Deputy President then turned to the issue of whether all of the federal agreements were applicable to FPU employees. After considering the instruments in light of changes in the federal legislation pertaining to the agreements, including a number of transitional legislative arrangements, his Honour concluded that all were applicable to the employment of those in the FPU. Given this finding, his Honour foreshadowed that if the proposed award and the federal awards and agreements dealt with the same matters, then the proposed award was not capable of being validly made. 10 His Honour then examined the matters in the proposed award and those found in the federal awards and agreements and concluded that the proposed award dealt with matters contemplated in the federal instruments. His Honour considered that inconsistency would thereby arise if the proposed award were made. Even if the Federal instruments were to be interpreted as providing minimum entitlements and the proposed award to be more generous, his Honour held this would still amount to inconsistency given the High Court's decisions in Clyde Engineering Co Ltd v Cowburn (1926) 37 CLR 466 and Blackley v Devondale Cream (Vic) Pty Ltd (1967) 117 CLR 253. 11 Consequent upon these findings, his Honour granted the order sought in the respondent's notice of motion, thereby indefinitely staying the proceedings. Leave to appeal 12 This appeal is brought pursuant to the provisions in Part 7 Chapter 4 of the Act, and in particular, ss 188, 191 and 192. Leave to appeal is therefore required. Section 188(1) relevantly provides that the Full Bench is to grant leave to appeal if, in its opinion, the matter is of such importance that, in the public interest, leave should be granted. The principles applicable to the grant of leave to appeal are well settled and it is trite to observe that leave will not be lightly or automatically granted. A matter of importance which may satisfy the public interest test for leave may include substantial questions of law and principle or something of importance for the jurisprudence of the Commission: Knowles v The Anglican Property Trust (No 2) (1999) 95 IR 380. 13 In this instance we have determined that leave to appeal should be granted to the extent necessary to deal with what we consider was an incorrect approach to the issues, both at first instance and on appeal. Rather than approaching the issue as one of inconsistency between federal and State law, we consider that the matter is more appropriately approached as an issue of award construction and interpretation. The relevant and crucial proposition may be stated in this way: where a position, established by an award classification and duty statement, becomes vacant for some time and is later occupied under the same classification title but with (slightly) altered duties, should that award be construed as no longer applying to that employment? A shorter version of this question might be stated as whether or not an alteration in duties for a classification under an award results in the award no longer applying to that classification. The submissions 14 The issues arising from these questions were raised with the parties during the hearing of the appeal. Mr Pearce, for the appellant, submitted that the duties performed by the recently reconstituted Fire Protection Unit cannot accurately be described as those found under the classification of Senior Fire Equipment Officer in the Salaried Officers Award 1955. As such, the current Senior Fire Equipment Officers cannot not be characterised as engaged in that classification or calling and, therefore, are not covered by that award or the subsequent agreements made in the years following the introduction of the Senior Fire Equipment Officer classification. Mr Pearce submitted that this was the case because the coverage of the award is, upon the ordinary meaning of the words used, described and determined by specific classifications rather than phrases such as "in or in connection with". Mr Pearce contended that the award could have been drafted otherwise, presumably in order to be broader and more widely inclusive, but it has not been drafted in that manner and therefore coverage is expressed by way of the inclusion of particular classifications and duty statements in the award. Turning to the current Senior Fire Equipment Officers, Mr Pearce submitted in substance that, as there were some differences in the duties as presently carried out and those set out in the award, the award and subsequent agreements did not cover the employees in the current FPU. As a result it is submitted the appellant is able to bring application for a new award pursuant to s 11 of the Industrial Relations Act Consideration 15 For reasons we shall give, the Full Bench does not consider that a different result would have been achieved, had the proceedings at first instance followed the appropriate approach. We do not accept the appellant's submissions as to the interpretation of the award. Further, we consider that the employees currently engaged as Senior Fire Equipment Officers in the respondent's Fire Protection Unit are properly covered by the federal awards and agreements referred to earlier. 16 The starting point for this conclusion is the plain language of the federal instruments. The most recent of the agreements is that entitled the "State Rail Authority of New South Wales Enterprise Agreement 1999 Towards 2000". Section 2 cl 2.2(i) of that instrument lists the parties bound as the: State Rail Authority of New South Wales and employees employed in the relevant callings and classifications specified in Part II of the State Rail Authority Agreement of New South Wales Enterprise Agreement 1992 (as amended). The terms of that provision read in its context, which includes its title, make clear that the provision also describes the coverage of the instrument. 17 The 1992 Agreement in clause 2 lists the employees bound as including those employees: ... engaged in the callings specified in the State Rail Authority of New South Wales Salaries and Wages (Interim) Award, 1992 (Part II), and whose conditions of employment are prescribed by the State Rail Authority of New South Wales Consolidated Conditions of Employment Award, 1992 (Part IV). 18 Part II of the Salaries and Wages (Interim) Award, includes the classification of Senior Fire Equipment Officer. The 1996 and 1997 Agreements, whilst containing salary points to identify classifications, also describe their coverage as binding on the respondent and the employees engaged in the "callings and classifications specified in Part II of the State Rail Authority of New South Wales Enterprise Agreement, 1992." The classification of Senior Fire Equipment Officer is covered, in terms, by the relevant agreements. 19 We also note that the "Towards 2000 Agreement" as made in 1999 uses the terms "callings and classifications", while the 1992 Agreement uses only the term "callings"; however, we do not consider that anything turns on the slight difference in verbiage. 20 The principles applying to the interpretation of awards were authoritatively stated in this jurisdiction in Kingmill Australia Pty Ltd t/a Thrifty Car Rental v Federated Clerks Union of Australia, New South Wales Branch (2001) 106 IR 217 where the Commission emphasised the need to approach the construction of an instrument by reference to the actual words used and their plain, ordinary English meaning. The relevant sections of the agreements referred to, state in terms that the position of Senior Fire Equipment Officer is covered by the instrument in question. It can also be seen that the Senior Fire Equipment Officer classification has been consistently referred to over time and this would appear to be indicative of a consistent intention to subject the employees of the FPU to coverage by the federal instruments. 21 This does not, however, completely dispose of the appellant's argument. Essentially the appellant contends for an interpretation of the relevant industrial instruments which would have the effect of an exclusive, rather than inclusive, approach. On the appellant's approach, an employer would have enormous scope to exclude an employee from award coverage merely by altering that employee's duties or classification. 22 We consider that the approach is wrong in principle. An award or agreement is an instrument created to include and benefit employees and should be interpreted in accordance with that purpose. This was recognised by Macken J in San Remo (Southland) Pty Ltd v Farrell (1987) 22 IR 291 where his Honour stated (at 294 - 295): [I]ndustrial tribunals have always tended to lean toward construction of awards and employment circumstances which would preserve the operation of instruments of regulation such as awards rather than against their operation. In so stating, his Honour was doing no more than applying, in the specific industrial context, the well known and often applied approach to interpretation epitomised in the Latinism ut res magis valeat quam pereat. 23 Some judges and writers appear to treat this approach as part of the general purposive or beneficial approach to interpretation whilst others treat it as a separate rule stated as "interpretation to ensure validity and attainment of object of legislation [or instrument]" see for example Pearce and Geddes, Statutory Interpretation in Australia, 5th Ed 2001, pp 48 - 49; Gifford, Statutory Interpretation 1990 p 69; Odgers, Construction of Deeds and Statutes 5th Ed 1967, pp 32 - 33; Edgar, Craies on Statute Law, 7th Ed 1971, pp 95, 103ff; Nokes v Doncaster Amalgamated Collieries Limited [1940] AC 1014 at 1022 (Viscount Simon LC); R v Portus; Ex parte City of Perth (1973) 129 CLR 312 at 317 - 318 (McTiernan J); Martin v Scribal Pty Ltd (1954) 92 CLR 17 at 97 (Taylor J), Wright v Gibbons (1948) 78 CLR 313 at 324 - 325 and Elconnex Pty Limited v Gerard Industries Pty Limited (1991) 105 ALR 247 at 268 (Burchett J). Notwithstanding some subsequent judicial issue taken with Macken J's approach, we consider his Honour's approach as entirely unexceptional and, particularly so, when its pedigree and conceptual basis are properly understood. 24 Indeed the Full Bench in Nestle Australia Limited and Patatou (unreported, Fisher P, Cullen J and Connor CC, 16 July 1993), acknowledged the basis for the approach of Macken J when it was found at first instance that the respondent to the appeal was covered by the Clerks (State) Award. The decision at first instance was influenced by the approach of Macken J in San Remo set out above. The Full Bench characterised Macken J's statement in this way: The rationale in San Remo (Southland Pty Ltd) v Farrell was the adoption of a beneficial construction of awards and employment circumstances in order to preserve the operation of awards rather than against their operation. 25 We also mention the decision of CSR Limited Officers' Association v CSR Limited (1997) 76 IR 310 where a Full Bench of the Australian Industrial Relations Commission dealt with an appeal against a refusal to certify two agreements under Div 4 Part VIB of the Workplace Relations Act 1996 (Cth). At first instance, the Commissioner refused to certify the agreements because he was not satisfied that the appellant was an organisation able to represent the industrial interests of the employees as required in s 170LJ(1) of the Workplace Relations Act. The relevant question on appeal was whether the appellant was entitled to represent the industrial interests of at least one of its members whose employment would be subject to the agreements (at 312). Although the Full Bench disagreed with the Commissioner's findings as to the capacity of the appellant, there was acceptance of the Commissioner's approach to the issue of "whether an employer can contract out of an award merely by changing the name of a position without materially changing the function?". The Full Bench held that "an employer cannot escape award coverage by merely changing the name of a position". Likewise in this matter, an award which is expressed to cover a certain classification of employees does not cease to apply merely because there is an alteration in duties. 26 For completeness, we refer to the observations of Maidment J in Comdox (No 272) Pty Limited (T/as Ronald Stead Golf) v Dawson (1993) 49 IR 458 where his Honour disagreed with the statement of Macken J in San Remo. Relevantly, Maidment J stated at 461: The observation by Macken J that: "… industrial tribunals have always tended to lean toward construction of awards and employment circumstances which would preserve the operation of instruments of regulation such as awards rather than against their operation." is unsupported by cited authority. I know of no tendency, in recovery proceedings, to widen the scope of awards beyond that intended by the award maker in circumstances where no alternative coverage has been pointed to. Any such tendency would seem to me to be inconsistent with the approach of the full bench of the Industrial Commission of New South Wales in re Race Course Totalisators Employees' Association of New South Wales in determining whether the work of totalisator employees was covered by an award. 27 Although we may not need to resolve explicitly the apparent tension between San Remo and Comdox, we consider that an award should not be interpreted as ceasing to have effect merely because of an alteration in the duties of a particular classification. In this sense, the statement made by Macken J is one which accords with the principle of ut res magis valeat quam pereat - it is preferable to interpret so as to give effect or operation to an instrument rather than interpret in a way that is destructive of that effect or operation. We also note that Pearce and Geddes refer to the principles as to beneficial or remedial construction in this way (at [9.2]): A remedial or beneficial provision is one that gives some benefit to a person and thereby remedies some injustice. The most commonly cited examples are social welfare and pensions legislation, workers' compensation Acts, safety legislation and so on. However, any legislation that is taken to make a change in existing law or adopt new provisions that are advantageous to an individual or to the public is likely to be regarded as falling within the description of remedial or beneficial…. The orthodox view of the approach to be adopted in relation to the interpretation of this type of legislation is provided by Isaacs J (dissenting) in Bull v Attorney-General (NSW) (1913) 17 CLR 370. The case concerned the interpretation of a section of the Crown Lands Act of 1895 validating certain transactions. It was held by the majority of the court not to validate all transactions under Crown lands legislation but only those that independently of the operation of the legislation were defective. Isaacs J took the view that the section was intended to validate all transactions concerning Crown lands. At 384, he said: In the first place, this is a remedial Act, and therefore, if any ambiguity existed, like all such Acts should be construed beneficially…This means, of course, not that the true signification of the provision should be strained or exceeded, but that it should be construed so as to give the fullest relief which the fair meaning of its language will allow. It should not be thought from the reference to ambiguity in this extract that Isaacs J was suggesting that the beneficial interpretation approach only applied where there was an ambiguity in the legislation. It is apparent from his endorsement of the view of Lord Shaw in Butler (or Black) v Fife Coal Co [1912] AC 149 that the reference to ambiguity is intended as an example of the general approach to remedial provisions - ambiguous provisions are to be interpreted in a manner favourable to those who are to benefit from the legislation: see R v Kearney; Ex parte Jurlama (1894) 52 ALR 24 at 28; Zangzinchai v Milanta (1994) 125 ALR 265 at 272. ... The approach to interpretation of beneficial provisions enunciated here is subject to the rider that the interpretation adopted 'must be restrained within the confines of the actual language employed and what is fairly open on the words used': Khoury (M&S v Government Insurance Office of NSW (1984) 54 ALR 639 at 650; Accident Insurance Mutual Ltd v Sullivan (1986) 7 NSWLR 65 at 68; Secretary, Department of Social Security v Knight (1996) 44 ALD 283 at 289. 28 Thus, where a law is beneficial in nature an approach to interpretation which confines or narrows the beneficial or remedial operation is to be avoided. This approach was applied by Kirby P in Cole v Director-General of Department of Youth and Community Services (1987) 7 NSWLR 543 in interpreting provisions of the Government and Related Employees Appeal Tribunal Act 1980 conferring appeal rights upon public servants. Section 20 of that Act granted appeal rights to an employee who had failed to gain an appointment because the employer appointed or recommended another employees to fill the vacancy. Section 21 qualified the rights of s 20 by providing, inter alia, that the appeal may only be brought where the maximum salary applicable to the position is greater than the salary paid to the appellant. 29 The respondent urged a construction of those provisions that would have the effect of barring the appellant from appealing to the Tribunal. Kirby P considered this approach was incorrect as it failed to approach the matter in terms of the principle of beneficial interpretation. His Honour stated (at 543): Thirdly, and most importantly, the provision for appeals is a beneficial one, conferring on employees of the Public Service entitlements to the review of decisions which were not enjoyed by Crown servants by the prerogative or at common law and which are not generally enjoyed, at least to the same extent, by employees in the private sector: see Suttling v Director-General of Education (1985) 3 NSWLR 427. The entitlement to appeal conferred by s 20 is a beneficial entitlement of employment. It should not be excluded or confined by the exceptions provided in s 21, except to the extent that those exceptions are clear. Any doubt about the scope of s 21(1)(e) should be resolved in favour of the enhancement of the right of appeal and against its diminution by the operation of the exclusion. In the present case it is not essential to rely upon this rule of construction. The language, context and legislative history of s 21(1)(e) make the meaning sufficiently clear. But the recognition of the beneficial operation of the statute provides another reason for giving the paragraph the construction urged by the appellant and for rejecting the respondent's appeal to the suggested general purpose and intended operation of the Act. 30 We consider that these observations have some analogy to the present matter. The language, context and history of the federal instruments make it very clear that the classification of Senior Fire Equipment Officer is covered by those instruments. The recognition of the operative and inclusive nature of an award and its intention to benefit a defined group of employees supports a beneficial approach to construction which discourages the kind of narrow interpretation urged by the appellant. As noted earlier, the construction urged by the appellant would enable an employer to effectively exclude employees from the benefits derived from an award's coverage. In any event, the appellant has not demonstrated such a distinction between the existing and proposed classifications as to warrant any different approach although, as we have said, that is not the real issue in this matter. 31 A purposive approach to interpretation supports the same conclusion. In Cole, McHugh JA emphasised the importance of interpreting legislation with the general purpose of the legislation in mind. As the terms of the objects provisions of the Government and Related Employees Tribunal Act provided for appeal rights against promotion and recommended appointment, his Honour was of the view that an appeal may lie even where the employee would receive no rise in salary. Interpreting the provisions in the context of the Act and its general purposes, his Honour held (at 579) that there was no justification for finding that the general words of the appeal rights in s 20 should be read down so as to require an element of promotion to be present to enable access to those rights. 32 Likewise, there is no justification for reading the award and agreements in a manner which effectively narrows coverage. The purpose and underlying objects of an award or agreement is the provision of employment conditions for a particular group of employees. In this case, those employees include those classified as Senior Fire Equipment Officer. 33 The conclusion reached by Grayson DP was correct. The appeal must be dismissed. We accordingly order: 1. Leave to appeal is granted. 2. The appeal is dismissed. ________________________ DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.