Industrial Relations Commission of New South Wales CITATION: Association of Professional Engineers, Scientists and Managers, Australia (NSW Branch) and Sydney Water re payment of fares allowance [2009] NSWIRComm 1098 APPLICANT Association of Professional Engineers, Scientists and Managers, Australia (NSW Branch) PARTIES: RESPONDENT Sydney Water FILE NUMBER(S): IRC 807 of 2009 CORAM: McKenna C CATCHWORDS: Industrial dispute re entitlement to fares allowance - dispute between APESMA and Sydney Water re interpretation of award concerning certain employees' claimed entitlement to payment of fares allowance - award provisions considered - evidence as to employees' work considered - question of interpretation determined in favour of APESMA's contentions LEGISLATION CITED: Industrial Relations Act 1996 Sydney Water (Professional Engineers) Award 2004 HEARING DATES: 15 December 2009 DATE OF JUDGMENT: 24 December 2009 APPLICANT Ms J Hannan, Legal Officer Association of Professional Engineers, Scientists and Managers, Australia (NSW Branch) LEGAL REPRESENTATIVES: RESPONDENT Mr J Mattson, solicitor Bartier Perry DECISION: NDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES McKENNA C 24 December 2009 Matter No IRC 807 of 2009 NOTIFICATION UNDER SECTION 130 BY THE ASSOCIATION OF PROFESSIONAL ENGINEERS, SCIENTISTS AND MANAGERS, AUSTRALIA (NSW BRANCH) OF A DISPUTE WITH SYDNEY WATER AND ANOTHER RE ALLEGED NON-PAYMENT OF FARES ALLOWANCE DECISION [2009] NSWIRComm 1098 1 The Association of Professional Engineers, Scientists and Managers, Australia ("APESMA") claims Sydney Water has failed to pay a fares allowance to a number its members, contrary to entitlements said by APESMA to arise under the Sydney Water (Professional Engineers) Award 2004 ("the award"), which is a federal industrial instrument. Sydney Water disputes APESMA's view there has been any underpayment, contending there was no relevant entitlement under the award for the employees in question. 2 The matter comes before the Commission by way of a referral agreement under s146A of the Industrial Relations Act 1996. APESMA seeks an interpretation, pursuant to s175 of the Act, concerning the award's fares allowance provisions apropos its members. On the hearing of the matter, Ms J Hannan, Legal Officer, appeared for APESMA. Mr J Mattson, a solicitor, appeared for Sydney Water. The award 3 Clause 33 of the award deal with fares. It relevantly reads as follows: 33. FARES 33.1 Definitions For the purpose of this clause: 33.1.1 Recognised office or depot will mean all premises occupied by the employer, other than temporary construction site accommodation erected on a construction site, for the exclusive use of a construction workforce. 33.1.2 Sent temporarily to work away will mean where employees are required to report to another work location other than their recognised office of depot for a specified period which does not contemplate a permanent placement. 33.1.3 Follow the job will mean where employees are required to work at other than a recognised office or depot and employer's transport is not supplied (and who do not have a recognised office or depot). 33.1.4 Home shall mean the place to which the employee returns each night whilst employed on a particular job, to and from which they are required to travel. 33.2 Entitlement Employees who go regularly to work at a recognised office or depot will bear the cost of travelling to and from their work. 33 … 4 APESMA claims that two of its members, Mirko ("Mick") Bertapelle and Eldon Davison ("the employees") were entitled to be paid the fares allowance for certain periods between 2002 and 2006 when they were working on-site for Sydney Water in connection with major construction/upgrading works then being undertaken at a Sydney Water facility, namely, the Wollongong Sewerage Treatment Plant ("WSTP"). Joint venturers Walter Construction Group Limited and Vivendi Water Systems Pty Ltd ("the contractors") had been contracted by Sydney Water to upgrade the WSTP. 5 Bede Payne, an organiser with APESMA, deposed that he understood the purpose of the fares allowance is to compensate employees for additional travel costs incurred in travelling to different work locations, when directed to "follow the job" by Sydney Water. Raymond Ferrier, Sydney Water's Industrial Relations Manager, deposed that although Sydney Water's awards historically have included fares allowances, there has, in more recent times, been a move away from paying such allowances to all employees. 6 Essentially, the disagreement between the parties turns on the question of the proper application of the award to the employees. APESMA's submissions 7 Ms Hannan submitted the employees' entitlement to payment of the fares allowance arose unambiguously on a plain, ordinary application of cl33 of the award to the employees' employment circumstances at the WSTP. First, the employees were working from temporary construction site accommodation; they were not working at a recognised office or depot. Second, the employees worked in that temporary accommodation on a construction site. Third, the temporary construction site accommodation was for the exclusive use of the construction workforce, and the employees should, she submitted, appropriately be characterised as members of the construction workforce on the WSTP project. 8 Ms Hannan submitted it was pertinent the award defines the meaning of neither "temporary construction site accommodation" nor "construction workforce" in such a way as to exclude the employees from the ambit of the fares allowance clause in the award. The evidence of the employees demonstrated, Ms Hannan submitted, they had been part of the construction workforce at the WSTP. The employees had been performing work that related, by way of "direct nexus", to the construction project - and their work went beyond an ancillary or supervisory role. For example, Mr Bertapelli's uncontested evidence was that he devoted a significant amount of working time at the WSTP site to construction work, whereas the evidence adduced by Sydney Water's from its witnesses was lacking in direct knowledge of the work the employees actually performed. 9 Ms Hannan submitted that evidence arising in cross-examination reinforced the employees' claims for payment of fares in as much as it indicated Sydney Water in fact undertook some design and construction work for aspects of the WSTP project and that Sydney Water's own employees (as opposed to exclusively the contractors' own employees or subcontractors, or both) were also directly engaged in construction work on the project. Ms Hannan submitted the approach adopted by Sydney Water relied on "artificial definitions", created to deny the employees' entitlements to the fares allowance. 10 Ms Hannan submitted that issues about entitlement to fares payment had not arisen previously for these classifications of employees; the award itself had not changed in decades, even if the jobs have evolved. Payment of the fares allowance typically had been made to Sydney Water's employees under working arrangements relevantly similar to those that applied at the WSTP project – and there were no relevantly distinguishable factors at the WSTP that would operate to disentitle the employees' claim for payment of the fares allowance. Ms Hannan encapsulated her submissions as follows: "It is evident that Mr Bertapelli and Mr Davison were not excluded from the construction workforce. They were working at [temporary] premises that were not a recognised office or depot and, as such, should be entitled to the fares allowance." Sydney Water's submissions 11 Mr Mattson submitted APESMA's case was an attempt to fit "a large square peg into a small round hole". The evidence, he submitted, simply did not establish the employees had been, in any sense that would be relevant to the claimed entitlement, engaged in construction work. The employees may have shovelled dirt on site to check work the contractor had undertaken, but that was not construction work. To the extent Mr Davison's evidence had indicated that Sydney Water's own employees had been directly involved in aspects of the design and construction work for the WSTP project, it appeared that work was undertaken by Sydney Water employees other than the two employees on whose behalf this fares allowance claim is made and, otherwise, the evidence was lacking in specificity. 12 Mr Mattson referred to the contract Sydney Water entered with the contractors to upgrade facilities at the WSTP. Mr Mattson submitted it was clear from the contract that the contractors relevantly had the design and construction responsibilities at the WSTP, rather than Sydney Water employees. The contract cost to Sydney Water of $166m put a clear perspective on where those design and construction responsibilities lay, he submitted. Sydney Water had moved away from undertaking its own construction work. Although Sydney Water once had a construction branch which employed about a thousand people now there are only 40 employees remaining. 13 The employees' role at the WSTP was not as part of a "construction workforce". Rather, the employees' role was, Mr Mattson submitted, as described in the evidence of Malcolm Crabb, Manager, Project Delivery, Asset Services Division. Mr Crabb's evidence indicated that, by 2000, the work of Sydney Water's project engineers and project managers had become administrative and managerial in nature, rather than involving actual construction work; the employees' role was to audit and manage Sydney Water's contractors in the tasks they had been paid to undertake. Mr Mattson submitted that under proper principles of award interpretation, the employees were not entitled to payment for fares and, in so contending, dissected the wording of relevant provisions of the award clause and aspects of the contract between Sydney Water and the contractors in the context of the evidence adduced in the proceedings. Against the background of that analysis, Mr Mattson submitted the two applicants were managing a contract, which happened to be for construction work. The characteristics of the premises/site at the WSTP and a proper consideration of the employees' role would not, Mr Mattson submitted, support a conclusion there was any relevant entitlement to payment of the fares allowance under cl33 of the award. Consideration 14 The competing contentions as to the proper application of the award is at the heart of this dispute. Clause 33.1.1 of the award relevantly refers to "… all premises occupied by the employer, other than temporary construction site accommodation erected on a construction site, for the exclusive use of a construction workforce." I turn now to a consideration of matters relevant to entitlements under the award. 15 First, the evidence established, unambiguously in my opinion, the employees were working from "temporary construction site accommodation" in as much as they were housed in a temporary building when working on the WSTP project. The site location was, for all relevant purposes, then under the effective occupation, control or possession of the contractors. 16 Second, the evidence also unambiguously established the accommodation was erected on what was then part of a construction site, given the upgrade/construction works being undertaken at the time at the WSTP. The evidence further indicated the accommodation and where it was located appropriately could be described as being for the "exclusive use" of the WSTP construction workforce. 17 The question, thirdly, of whether the evidence established the employees appropriately could be characterised as members of "a construction workforce" is, in my view, more ambiguous. I turn to that matter. Over the decades since the 1970s, Sydney Water has significantly reduced the size of its construction branch from approximately one thousand employees to around 40 employees, consequent upon its decision increasingly to engage third parties to perform major works that formerly had been undertaken by that branch. As a result, it may be accepted the role of the remaining employees, such as Mr Bertapelle and Mr Davison, had, at the time of the WSTP project, had characteristics differing from the days when major construction works were all undertaken in-house, as it were, by Sydney Water's own employees. Here, Sydney Water had paid a substantial amount of money for the contractors to undertake design and construction work for the WSTP project. In those circumstances, it is reasonable to accept that Sydney Water did not expect that part of the employees' duties would necessarily or inherently involve design and construction work itself, because the contractors had been paid to undertake those responsibilities. 18 The specific classifications of the employees during the period relevant to the claim for fares was unclear, but their jobs relevantly involved project delivery responsibilities. As described in Mr Crabb's evidence, Sydney Water considered the employees' role in the WSTP project as involving duties of an administrative, managerial and auditing nature, rather than being part of a construction workforce. 19 Despite the evidence and submissions for Sydney Water, I accept APESMA's submissions that the employees appropriately may be characterised as having been part of the construction workforce for the WSTP project – even accepting Sydney Water's evidence and submissions at their highest in relation to the administrative, managerial and auditing role that was ascribed by Sydney Water to the employees' duties. It seems to me that various aspects of the employees' duties envisaged by Sydney Water in their "project delivery" role for the WSTP project, coupled with the employees' own evidence as to the roles and work they in fact performed, comfortably may be described as being well-integrated with that of the construction workforce generally in relation to the WTSP project. For example, an on-site role ensuring that the design and construction work being undertaken by the contractors according to Sydney Water's specifications and standards seems inherently to involve the employees as part of the construction workforce, albeit even if only in an oversighting or supervisory capacity. It would be artificial, I think, to conclude otherwise. It would be artificial also, I think, to read-down the meaning of a construction workforce to only those employees who were involved in manual labour on the site to the exclusion of other classes of employees whose on-site work was integral to the construction project. 20 There would be a broad spectrum of employees who aptly could be described as being part of a construction workforce on any given project even if they are not involved in the manual labour aspects of construction work. But in any event, the employees' uncontested evidence was that they in fact had "hand-on" construction-related involvement in a practical sense, as well as involvement in other relevant matters such as participation with occupational health and safety-related issues. Conclusion 21 Initially, APESMA had proposed to progress this dispute by way of a small claims application seeking an order for payment of the amounts claimed on behalf of the employees. For reasons related to certain jurisdictional objections raised by Sydney Water, APESMA, in the end, sought only a determination pursuant to s175 of the Act in relation to the following question: Pursuant to Clause 33 [of the award], were Mr Mirko Bertapelle and Mr Eldon Davison entitled to payment under the Fares Allowance Clause during the relevant periods? Section 175 of the Act provides as follows: 175 Powers of interpretation The Commission may, for the purpose of exercising its functions in connection with a matter before it, determine any question concerning the interpretation, application or operation of any relevant law or instrument (including the industrial relations legislation or instrument). Pursuant to s175 of the Act, I determine that Mirko Bertapelle and Eldon Davison were entitled to payment of the fares allowance under cl33 of the award in relation to the period/s of time they respectively worked on the WSTP project. _______________________ 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.