Industrial Court of New South Wales CITATION: Barry v Sydney Water Corporation [2007] NSWIRComm 163 APPLICANT: Julie-Anne Barry PARTIES: RESPONDENT: Sydney Water Corporation FILE NUMBER(S): IRC 2883 of 2005 CORAM: Marks J CATCHWORDS: Unfair contract s106 proceedings - work performed through series of term contracts - allegations of unfairness based on lack of security of employment and denial of termination and redundancy payment - necessary to identify a contract or arrangement to which unfairness is attached - no evidence of an understanding or arrangement that there would be continuity of work - employment pursuant to a succession of fixed term contracts does not indicate an understanding of continued employment on an indefinite basis - hope or expectation of continued employment is not sufficient for the Court to interfere in the contract - contract was freely made and the provisions were understood - the contract being for a fixed term does not render it unfair - proceedings dismissed LEGISLATION CITED: Industrial Relations Act 1996 ss105, 106, 108B Fish v Solution 6 Holdings (2006) 225 CLR 180 CASES CITED: Mitchforce Pty Ltd v Starkey (No 2) (2003) 130 IR 378 Schwartz v Sydney City Area Health Service and anor (2002) NSWIRComm 79 HEARING DATES: 12 June, 13 June, 14 June 2007 DATE OF JUDGMENT: 3 July 2007 APPLICANT: Mr M Gibian of counsel Solicitor: Mr J Sefton Employment Lawyers LEGAL REPRESENTATIVES: RESPONDENT: Ms E Brus of counsel Solicitor: Mr J Mattson Bartier Perry Solicitors JUDGMENT: INDUSTRIAL COURT OF NEW SOUTH WALES CORAM: Marks J Tuesday 3 July 2007 Matter No IRC 2883 of 2005 Julie-Anne Barry v Sydney Water Corporation Application under s 106 of the Industrial Relations Act 1996 JUDGMENT [2007] NSWIRComm 163 1 The applicant, Julie-Anne Barry, seeks relief against the respondent, Sydney Water Corporation, pursuant to s 106 of the Industrial Relations Act 1996 ("the Act"). The applicant performed work for the respondent initially through the services of an employment agency commencing on 18 June 2001 and subsequently pursuant to a series of term contracts of employment. Her employment came to an end on 17 December 2004. 2 The applicant alleges that, in the alternative, her contract of employment with the respondent (presumably the last of them) or an arrangement pursuant to which she was to be offered continuing term contracts of employment on an indefinite basis, was unfair for the purposes of s 106 because, essentially, she was denied security of employment and was also denied a termination payment and a redundancy payment when her employment came to an end. 3 Relevantly, ss 105 and 106 of the Act are in the following terms: s 105 Definitions In this Part: "contract" means any contract or arrangement, or any related condition or collateral arrangement, but does not include an industrial instrument. "unfair contract" means a contract: (a) that is unfair, harsh or unconscionable, or (b) that is against the public interest, or (c) that provides a total remuneration that is less than a person performing the work would receive as an employee performing the work, or (d) that is designed to, or does, avoid the provisions of an industrial instrument. s 106 Power of Commission to declare contracts void or varied (1) The Commission may make an order declaring wholly or partly void, or varying, any contract whereby a person performs work in any industry if the Commission finds that the contract is an unfair contract. (2) The Commission may find that it was an unfair contract at the time it was entered into or that it subsequently became an unfair contract because of any conduct of the parties, any variation of the contract or any other reason. (2A) A contract that is a related condition or collateral arrangement may be declared void or varied even though it does not relate to the performance by a person of work in an industry, so long as: (a) the contract to which it is related or collateral is a contract whereby the person performs work in an industry, and (b) the performance of work is a significant purpose of the contractual arrangements made by the person. (3) A contract may be declared wholly or partly void, or varied, either from the commencement of the contract or from some other time. (4) In considering whether a contract is unfair because it is against the public interest, the matters to which the Commission is to have regard must include the effect that the contract, or a series of such contracts, has had, or may have, on any system of apprenticeship and other methods of providing a sufficient and trained labour force. (5) In making an order under this section, the Commission may make such order as to the payment of money in connection with any contract declared wholly or partly void, or varied, as the Commission considers just in the circumstances of the case. (6) In making an order under this section, the Commission must take into account whether or not the applicant (or person on behalf of whom the application is made) took any action to mitigate loss. Factual background 4 The narration that follows is based on the oral and affidavit evidence given in the proceedings as well as on a number of documents, which became evidence. 5 The applicant first worked for the respondent commencing 18 June 2001 when she was placed with it through the services of a personnel company. She worked as an administrative services officer. Some time prior to 24 September 2001, the applicant was approached by a Ms Allen of the respondent and asked whether she was interested in making application to become a direct employee of the respondent. She was told that she could work as an administration services officer for a period of about 18 months and could then apply for permanent employment with the respondent. 6 On 26 September 2001, the applicant accepted a written offer of "temporary term employment" for a period of 24 months. The letter of offer said that "during the period of contract, you may apply for any appropriate full-time vacancies advertised in the Greensheet. There should be no expectation of permanent employment, unless you have been successful with an application for an advertised vacancy. On the expiration of this contract, there will be no entitlement to any benefits associated with the Sydney Water Corporation's Redundancy provisions." 7 On 17 September 2002, the applicant applied for a position of Customer First Ambassador EOI and following an interview and hiring process accepted that position. The applicant accepted a written offer of employment dated 10 October 2002, indicating that the applicant was to be employed in that position commencing 15 October 2002 until 30 June 2003. The applicant said that she was informed at that stage that she was being seconded to this new position and that at the end of the placement she would return to her substantive position of an administrative services officer. Prior to that contract coming to an end, the applicant applied for other positions, but without success. On 1 July 2003, she returned to her substantive position as an administrative services officer. 8 In about August 2003, Ms Allen had applied on the applicant's behalf for her to be classified as a permanent full-time employee, but without success. On 23 September 2003, the applicant applied to be employed as a Water Restriction Community Officer ("WRCO"). 9 The applicant was aware that her last day of employment under her then current term contract was 3 October 2003. That day, she had a telephone conversation with Mr Colin Ridley about the fact that she had not heard whether she was to be appointed as a WRCO. The applicant alleges, and Mr Ridley denies, that Mr Ridley said to her words to the effect that "we can't afford to lose you". In any event, Mr Ridley made enquiries on the applicant's behalf which culminated in her being informed on 3 October 2003 that the fact that her employment was to come to an end that day would not preclude her from applying for the WRCO position. 10 In fact, the applicant was successful in her application and accepted an offer of employment dated 14 October 2003 "for a period of up to four months with the actual period depending upon mandatory drought water restrictions….upon completion of the placement you will return to your substantive position and rate of pay." Of course, the applicant had no other substantive position at that stage and therefore nothing to return to at the completion of the four-month period. 11 The question of an alternative substantive position was clarified in a letter dated 9 February 2004 in which the applicant was offered an extension to her term employment as a WRCO "until 16 April 2004 at which time your employment will cease." The applicant accepted this offer in writing. 12 The WRCO role involved among other things policing water restrictions imposed by the respondent. At all times, the applicant was advised that there was no guarantee of continued employment in this area because it depended upon whether or not water restrictions continued in place and depended on political decisions, presumably directed to whether or not restrictions would be imposed and enforced. 13 The applicant spoke to her supervisor, Mr John Wild, about her continuing employment prospects at some stage prior to 15 March 2004. This motivated her to approach Mr Peter Hartnett, a human resources manager with responsibility in the area in which the applicant was employed to ascertain whether there were any alternative employment prospects available to her. The applicant was advised by email dated 15 March 2004 that an administrative position was available in Corporate Services. The applicant expressed her interest and was advised that she could commence employment in that role on 13 April, replacing another employee who was on sick leave. An email dated 1 April 2004 said "As discussed, we can commit to you working with us full-time for at least 3 months - and we give you regular updates on Claire's progress and her return to her role." There was mention that approval had been granted to keep the applicant in that position until the end of December. 14 In about June 2004, the Minister announced level 2 water restrictions. The applicant was told that all staff were being informed by email of the availability of work as WRCO's. The applicant at that stage applied to be employed in that position. On 1 July 2004, the applicant accepted an offer of employment dated that day appointing her to a "term appointment effective 1/07/04 and will be for a period of up to 17th December 2004 with the actual period depending upon mandatory drought water restrictions remaining in place." The letter also said "This term arrangement supersedes any other previously held term arrangement with Sydney Water Corporation….Upon completion of the placement, your ongoing arrangements will be reviewed. There should be no expectation that this term arrangement will lead to permanent employment." 15 In August 2004, the applicant's immediate supervisor, Mr Geoffrey McNamara, raised with her a number of complaints concerning her performance. In evidence, Mr McNamara said that he dealt with the issues that he raised with the applicant and that having raised them with her, they played no further part in, and did not impact on, the applicant's continuing employment. 16 On 15 September 2004, the applicant applied for the position of a project officer with the respondent. She was not afforded an interview and made complaints accordingly. Subsequently she was told that her experience and qualifications did not justify the granting of an interview for that position. In an email to a person apparently in the human resources area of the respondent, the applicant complained about the process and concluded "I am not sure if you are aware that I have been a 'term-contract' for the past four years (varied projects, currently acting as Water Restriction Control Officer in the field) and I am finding it very frustrating to attain a permanent role within Sydney Water and this is also affecting my capacity to obtain a home loan. I believe that this whole process has been unfair and un-professional. Is there any way of appealing this decision?" 17 In June 2004, the respondent had made an announcement that its offices at Rockdale, Blacktown and Chatswood would close by the end of that year and that Customer Service Centres at Liverpool, Rockdale, Blacktown and Chatswood would also close. The relevant union had agreed to establish a joint working party to discuss issues relating to these developments and the respondent intended to offer voluntary redundancy for the equivalent of 30 customer service representative positions. 18 As a result of that announcement, it became necessary to endeavour to deploy a number of employees who were displaced and to whom redundancy payments would not be offered or accepted in other areas of the respondent's operations. All of the persons who were currently working as WRCO's were employed on term contracts because they were regarded as temporary positions. The use of WRCO's was reviewed regularly and during 2004 at intervals of six months. All of the persons employed as WRCO's had been re-deployed from other substantive positions in the respondent's organisation and all were otherwise full-time employees of the respondent save for the applicant who was the only employee who was on a fixed term contract. From time to time, persons who were on secondment as WRCO's returned to their substantive work area as and when the needs of the respondent's organisation required this. All of the internal documentation referring to WRCO positions and inviting applications to such positions consistently described WRCO positions as being either temporary or term appointments. All of the training and induction processes, on the evidence given by persons called on behalf of the respondent, emphasised the temporary nature of WRCO work and the requirement that term appointments be renewed from time to time consequent upon regular reviews. Although some of the persons who gave evidence on behalf of the respondent could recall the applicant attending a training sessions in 2003, none could recall with any precision having specifically made mention of the temporary nature of these positions to her. Nevertheless, on the preponderance of the evidence, especially that given by Mr Cupitt who interviewed the applicant for her initial appointment as a WRCO, I am persuaded that the applicant was informed that the position would be temporary and that there would be no guarantee of continued work. 19 By letter dated 11 October 2004, the applicant applied for a position of executive assistant with an external organisation. 20 On Monday 29 November 2004, the applicant was requested to meet with Mr McNamara, her team leader. This meeting was arranged by Mr McNamara at the instigation of Mr John Ethell, the Manager, Water Restrictions Enforcement. He was also the Manager of Development Operations of the respondent. In November 2004, Mr Ethell had undertaken a review of the use of WRCO personnel in conjunction with the impact of the restructure in the Customer Operations area, which had been announced in June 2004. This resulted in about 30 Customer Service Representative employees being made surplus to the requirements of the respondent. This was further to another 27 staff who had earlier been identified as surplus to the requirements of Development Operations in about August 2004. The respondent's redundancy policy required it to find alternative employment for employees by way of redeployment into another area. One of the measures that Mr Ethell determined to take was to transfer some of the persons who were surplus to the respondent's requirements into the WRCO area. For this reason and, I am satisfied on the evidence, for this reason alone, Mr Ethell determined that he would not extend the applicant's then current contract and would allow it to come to an end. 21 Mr Ethell said that he had intended to inform the applicant about this personally but was unable to do so having been injured in a motor vehicle accident. He accordingly requested a team leader, Mr John Wild, to meet with the applicant to explain his decision. It was that meeting that the applicant attended on 29 November 2004. Also present at that meeting was Mr McNamara. 22 In order to prepare himself for the meeting, Mr McNamara telephoned Mr Hartnett and discussed with him whether the applicant should perform office duties between 29 November and the date that her contract expired or whether she should continue on as a WRCO. Mr McNamara mentioned to Mr Hartnett the fact that there had been a few complaints concerning the applicant's use of a motor vehicle. Mr Hartnett advised Mr McNamara that the applicant could be given a choice whether to stay in the office or take an early payment including payment which would pay out not only salary but also overtime which the applicant would have earned during the remaining three weeks of her contract. 23 Mr McNamara prepared a document outlining the matters that he wished to discuss with the applicant being, in effect, a script which he intended to follow. His evidence was that he followed that document while conducting the interview with the applicant. The document is in evidence. 24 Mr McNamara said, and I accept, that he informed the applicant that there had been a restructure and a closure of customer service centres resulting in excess staff and that they needed to be placed in jobs. Accordingly, the applicant's contract would not be renewed after it expired on 17 December 2004. He then discussed with her payment out of the remainder of her contract of three weeks. The applicant indicated that she would leave straight away. 25 On the following day, the applicant telephoned Mr McNamara asserting that there were a number of complaints about her that had impacted upon the decision not to renew her contract. Mr McNamara said, and I accept, that the complaints had been dealt with and that the reason for non-renewal of the contract was confined to the need to find duties for surplus staff. 26 On 1 December 2004, the applicant telephoned Mr Ethell when she again raised the issue of the complaints that had been made against her and as to whether they had been a reason for the non-renewal of her contract. Mr Ethell denied that the matter of the complaints had had any relevance to his decision. 27 The applicant conceded in her evidence that at all times she was aware that each of the successive contracts under which she performed work for the respondent was of a fixed term and temporary nature. Nevertheless, she believed, on the basis of what she said had been told to her from time to time by supervisors and others, that there would be an availability of work for her as a WRCO for so long as water restrictions remained. However, whilst, on the totality of the evidence, I find that comments of this kind were made by a number of the respondent's personnel, all of whom were senior to the applicant, they were made in the context of an expectation of what might occur rather than an indication of what would occur. I am satisfied also that there was never at any stage any communication made by any person, either orally or in writing, to the applicant to the effect that the clear provisions in her successive contracts of employment would not be adhered to by the respondent and would not apply to her. 28 Consequent upon the findings of unfairness that the applicant urged should be made in her favour, she sought payment of monetary compensation of about $55,000 being 20 weeks remuneration as payment in lieu of notice and 18 weeks remuneration by way of a redundancy payment, alleging that, in effect, she had been made redundant. 29 In general terms, the applicant's submissions as to unfairness were formulated on the following bases: 1) The continuation of employment over a period of more than three years constituted by successive fixed term contracts operated unfairly on the applicant. "Long term insecure employment either on a casual basis or through a series of fixed terms contracts can have serious disadvantageous effects for the individual employee concerned." 2) The respondent had breached its own policies in engaging the applicant from October 2001 on a contract for a term of 24 months. 3) There were no reasons why the respondent should offer the applicant fixed term contracts rather than permanent employment by reference to the respondent's operational requirements or by reference to any particular project or task undertaken by the respondent. 4) The respondent had the benefit of the applicant's skills, work and organisational knowledge acquired over the time of her employment and yet the applicant was deprived of the advantages of security of employment. 5) On each occasion a particular contract on which the applicant was employed came to an end, the respondent's personnel had taken steps to find alternative employment for her and this, coupled with remarks made by the respondent's personnel, created an expectation in the applicant that she would continue to be employed by the respondent. 6) The circumstances of the applicant's employment by the respondent permitted the respondent to dispense with her services upon the expiry of any particular contract as a matter of discretion and without any requirement to give notice or make any severance or redundancy payment to her upon termination. 7) The applicant at all stages of her employment as a WRCO was under the impression that her work would continue for so long as the water restrictions remained in force. 8) The applicant was made redundant and should be entitled not only to compensation referrable to notice of termination but also a redundancy payment in accordance with the respondent's redundancy policy. 30 It is quite clear from the evidence that the applicant regarded the respondent's failure to renew or offer her a further employment contract to work as a WRCO as being unfair. Indeed, the applicant considered that the totality of the circumstances of her employment by the respondent involving, as it did, a series of successive contracts and depriving her of the benefits of security of employment was, in all the circumstances, unfair. However, a lack of security of employment engendered by "flexible employment arrangements" is now a hallmark of employment generally. In addition to the utilisation of short-term contracts, employers generally now make use of labour hire arrangements, part-time employees, casuals and consultancies to complement and supplement a core group of full-time employees with the aim of minimising the cost of hiring labour. These situations might be said to create unfairness in the minds of persons seeking permanent full-time employment because they lessen the incidence of full-time employment. But it would be a strange result if such arrangements could per se cause such contracts of employment to be characterised as unfair. 31 Circumstances that are perceived by persons to be unfair do not necessarily attract the jurisdiction of this Court under s 106 of the Act. Jurisdiction and power to make orders under s 106 is directed to a contract as defined in s 105 of the Act. Relevantly, for the purposes of these proceedings, it is necessary for the applicant to identify an arrangement or contract of the requisite kind to which she and the respondent were parties and to convince the Court that a finding of unfairness may be attached thereto. So much was emphasised by the majority judgment of the High Court of Australia in Fish v Solution 6 Holdings (2006) 225 CLR 180. Was there an arrangement? 32 What constitutes an arrangement for the purpose of s 106 has been discussed in a number of authorities. A convenient, comprehensive and succinct summary is to be found in the joint judgment of Wright J, President and Walton J, Vice-President in Mitchforce Pty Ltd v Starkey (No 2) (2003) 130 IR 378. 33 In essence, it is necessary for the applicant to demonstrate that there was some understanding or meeting of the minds between her and a person or persons on behalf of the respondent to the effect that she would be offered continuing work for the respondent despite the use of successive term contracts. 34 In attempting to point to evidence of such an understanding, Mr Gibian, counsel for the applicant, relied upon a discussion which the applicant said she had at the time that she commenced to be employed directly by the respondent that even though she was being offered a term of up to 24 months, her manager "regarded permanency as an appropriate mode of employment for her." It is true, on the evidence of the applicant, that Ms Allen said to her that she would attempt to secure full-time, permanent employment for the applicant. However, this did not eventuate and all that the applicant was offered was a fixed term 24-month contract. There is no other evidence of any further involvement with Ms Allen or anyone else that is indicative of any understanding between the applicant and representatives of the respondent that there would be a continuity of work made available to the applicant. 35 The applicant then submitted that the arrangement was evidenced by the fact that the applicant was given continuous employment pursuant to a succession of fixed term contracts. However, the fact that this occurred is, in my opinion, equivocal. It is not necessarily consistent with any understanding between the applicant and representatives of the respondent that she would continue to be offered fixed term contracts on an indefinite basis. Indeed, the provisions of the letters of appointment, which I have earlier set out, are more indicative of the continued availability of work on a succession of fixed term contracts simpliciter. They do not, of their own terms, and in the totality of the circumstances in which these contracts were made available to the applicant, point to the existence of any arrangement of the kind upon which the applicant seeks to rely in these proceedings. 36 Accordingly, I find that no such arrangement as alleged by the applicant existed at any time relevant to these proceedings. Contract 37 The applicant alleged that each of the contracts of employment was unfair because she was employed in circumstances that denied her security of employment. There was no submission made on behalf of the applicant that she was, in effect, employed under the one contract of employment which commenced on 8 October 2001 and came to an end on 17 December 2004. The applicant submitted that each of the successive contracts of employment was unfair in the manner indicated. The respondent submitted that the applicant was precluded from relying on any contract of employment which had been terminated beyond 12 months from the date of issue of the summons, namely 3 June 2005, because of the provisions of s 108B of the Act which is in the following terms: s 108B Time for making Application (1) An application for an order under this Division in relation to a contract that has been terminated must be made not later than 12 months after the termination of the contract. (2) The Commission does not have jurisdiction to extend the time for making any such application or, subject to subsection (3), to accept an application made after the time prescribed by subsection (1). (3) The Commission may accept an application made within 3 months after the time prescribed by subsection (1) if the applicant satisfies the Commission that there are exceptional circumstances justifying the making of the late application. 38 This, in turn, created a difference of opinion between the parties as to what was the relevant contract of employment. The respondent stated that the relevant contract was that which commenced on 1 July 2004. The applicant, on the other hand, relied upon a letter of 1 April 2004, when the applicant was appointed to the project support position as an administration officer, which referred to an offer to "an extension to your term employment from 13 April 2004 until 31 December 2004." However, the letter went on to say, "…up to 31 December the ongoing need for the role will be quarterly. At each review point the ongoing need of this temporary arrangement will be assessed. Any further continuation in this role will be dependent upon the availability of the substantive position holder. If at each review it is determined that the role is no longer required, then the termination of this term arrangement will be as per below." There was then reference to termination on two weeks' notice by either party. 39 In my opinion, the effect of the extension of the applicant's substantive underlying term employment to 31 December 2004, referred to in the 1 April 2004 letter, was overtaken by the 1 July 2004 letter which created a term appointment from that date up to 17 December 2004 in the position of a WRCO. This appointment obviously terminated the applicant's temporary employment in the project officer position and constituted, relevantly, a new contract of employment. It is only this contract that the applicant may rely upon for the purpose these proceedings. If, however, I was incorrect in this analysis, this would not, in my opinion, affect the ultimate disposal of these proceedings. I would reach the same conclusion no matter which contract was appropriate to be considered. Was there any relevant unfairness? 40 In Schwartz v Sydney City Area Health Service and anor (2002) NSWIRComm 79, I summarised my understanding of the approach to the determination of whether the requisite unfairness exists for the purpose of s 106 and the principles to be adopted in the following way: "71 It is a trite observation that a pre-condition for the exercise of any power under s 106 is a finding that the relevant contract is unfair. A helpful discussion as to the approach of the predecessor tribunals to this Court to the determination of whether a contract etc is unfair is contained within the joint judgment of Fisher CJ and Hungerford J in the Industrial Court of New South Wales Full Court in Baker v National Distribution Services Ltd (1993) 50 IR 254. At 271 their Honours said: "The test of unfairness within the meaning of s 88F of the Industrial Arbitration Act , and hence s 275 of the present Act, has received much attention by the Court and by the previous Industrial Commission over very many years, but, in our review of the cases, the approach stated by Sheldon J in Davies v General Transport Development Pty Ltd [1967] AR (NSW) 371 over 26 years ago has endured; his Honour commented (at 374) that unfairness of a contract or arrangement was to be determined according to "the common sense approach characteristic of the ordinary juryman ....It is a plain matter of morals not law." His Honour cautioned, however, (at 374,375) that the section's "massive power makes it imperative that it should be exercised with proper restraint ... it should not permit itself to become a refuge for those who are merely disgruntled with a bargain entered into on even terms. ... the discretion should be exercised to protect victims of wrong dealing not to prescribe anodynes." Those words by his Honour echoed what had been said earlier by Beattie J in Agius v Arrow Freightways Pty Ltd [1965] AR (NSW) 77 at 89 that it was a matter of deciding "in each particular case by the application of the tribunal's common sense and sense of justice whether a particular transaction is unfair, harsh and unconscionable"'. The nature of the unfairness attracted by s 88F was considered later by the Industrial Commission in Court Session (Perrignon and Dey JJ, Cahill J dissenting) in A & M Thompson Pty Ltd v Total Australia Limited [1980] 2 NSWLR 1 at 13 as follows: 'It has been said that fairness is determined by the commonsense approach of a juryman and that it is a moral and not a legal issue (Davies' case). Whether this be so or not, it does seem that in distinguishing between what is fair and what is not fair the Judge must apply standards which appear to him to provide a proper balance or division of advantage and disadvantage between the parties who have made the contract or arrangement. In doing so he would always have to bear in mind the conduct of the parties, their capability to appreciate the bargain they had made and their comparative bargaining positions when entering into the contract or arrangement.' (at 271-2). 72 It is my understanding that in determining whether there is unfair conduct for the purpose of proceedings brought under s 106 and especially under sub s(2), the Court is required to exercise a value judgment reflecting contemporary community values. The contemporary values may be derived from the commonsense approach characteristic of the ordinary, reasonable, hypothetical 'standard' member of the community. Such a person will be neither an employer nor an employee, must be careful to weigh up the competing interests of the applicant as an employee and the respondent as an employer and those interests must be accommodated and viewed objectively and balanced within the context of the factual matrix which applies to them. Such a process will accommodate the reasonable requirements and understanding of an applicant as an employee and the reasonable requirements and understanding of a respondent as an employer in the context of the needs of the employer to undertake its activities in an efficient, effective and competent manner. 73 Of course the identification of contemporary community values is not without its own difficulties. Some insight as to the difficulties involved may be gained from the discussion by Professor John Braithwaite in the article entitled 'Symposium on Community Values in Law' published in vol.17 of the Sydney Law Review at 351. Professor Braithwaite draws on a body of literature to make a distinction between community attitudes and community values, the former not necessarily assisting a court in determining a matter, the latter having much greater relevance. An obvious example of an attitudinal matter is the debate concerning abortion. The corollary and underlying value against which such debate is conducted is 'respect for human life, health, freedom of choice'. 81 I have already referred to the process which is involved in determining whether a contract or arrangement etc or conduct is unfair. In the context of this process it is important to observe that there will be many cases where there is no absolute defining boundary which delineates what is fair from what is unfair. Often a range of conduct or activities may be said to fall within the limits of what is assessed to be fair, and, by corollary not unfair. This is because of the lack of absolute and scientifically determined criteria which differentiate the concepts of what is unfair. 82 The assessment which is to be made judged by the standard of the ordinary, reasonable, hypothetical 'standard' member of the community is not capable of precise analysis and delineation. There will be a variety of opinions held by such a person. The exercise of a value judgment in these circumstances is obviously made more difficult, but it is a difficulty which is not confined to judges of this Court. By way of analogy, evaluations of what is 'reasonable' are made daily by judges in all courts determining claims based on breach of duty of care in negligence, and those brought under certain provisions of the Trade Practices legislation. 83 It must be also be observed that the determinative process by which a judge ascertains whether the relevant unfairness exists cannot be undertaken in a factual vacuum. There has to be a contextual framework within which the value judgment may be made, as with any judgment. I am unable to ascertain how a value judgment can be made concerning conduct of persons without considering as a potentially important contextual matter the circumstances of any relationship between them. Where the parties are employer and employee, in many, but not necessarily all, cases the fact of employment and the circumstances surrounding the employment situation will be important contextual matters. In the case of conduct, there may be circumstances where it is appropriate to consider that conduct without having regard in any way to the fact that the parties involved in the proceedings are employer and employee. Examples would include allegations of brutality and vilification. Here, fundamental community values would be involved without necessarily, as a matter of logic, having regard to the employment relationship. However there will be many cases where the fact that there is an employment relationship and the circumstances of that relationship will be critical contextual factors in determining whether the relevant or requisite unfairness exists. In many cases, the consensual nature of the relationship will impact on the circumstances of that relationship. It is quite clear that employment is based on contract, rather than status. (See for example the decision of the High Court of Australia in Byrne v Australian Airlines Ltd (1995) 185 CLR 410.) Once circumstances arise which necessitate the contractual basis of the relationship being taken into account in the exercise of a value judgment leading up to a determination of whether conduct is unfair, difficulties emerge in applying in an absolute sense all of the observations of the majority judgment in Reich about the place that conduct per se plays in s 106(2). No doubt it was considerations of this kind which led to the observations of the Full Bench in Origin Energy , to which I have previously referred. As the Full Bench pointed out in Origin , the contract itself assumes significance because the power to award the payment of money is consequential upon the principal relief available under s 106, namely orders declaring the contract void or varying it. That is, there must be an appropriate and relevant nexus between the declaration that a contract is unfair, the avoidance or variation of the contract and the awarding of monetary compensation." 41 Of course, the finding of unfairness must be confined to one that applies to a contract or arrangement as defined in s 105. This necessary nexus requires the Court to go beyond a consideration of whether, in all the circumstances, the applicant's treatment by the respondent was in general terms unfair or brought about an unfair situation. As I have previously commented, it is arguably unfair that a person is denied the opportunity of security of employment with all that attaches to those circumstances. 42 The need to direct the focus of attention to the contract in turn throws up for consideration the respective rights, duties and obligations of the parties to the contract established by reason of the provisions of the contract (or in some cases, by what a contract may fail to provide). One approach that is often adopted in considering whether there is relevant unfairness is to consider the respective bargaining positions of the parties. In the circumstances of these proceedings it was argued on behalf of the applicant that she was in an unequal and inferior bargaining position with the respondent in terms of what she was able to attain by way of negotiation. Whilst such an approach may yield a certain result, I do not find it particularly helpful in determining whether the contract is unfair in its terms. What is more appropriate than the bargaining positions of the parties is the way in which that position is reflected in the provisions of the contract. One is always driven back to the contract itself. 43 It is possible, in my opinion, to test the fairness or otherwise of the provisions of a contract by reference to what it has achieved in terms of "equality" used in the sense of "fairness". That is, no matter what the respective strengths and weaknesses of the parties, is the result "fair"? The most appropriate discussion of this concept which readily comes to mind is found within a text of Professor André Comte-Sponville, a Professor of Philosophy at the Sorbonne entitled "A Short Treatise on the Great Virtues" (Vintage 2003). In discussing the virtue of justice in the sense of fairness, Professor Comte-Sponville said, "Justice is equality, but it is an equality in rights, whether established juridically or required morally. Alain, following Aristotle, concurs on this point and amplifies: 'Justice is equality. By this I don't mean a chimera, some far-off goal; I mean the relationship that any fair exchange immediately establishes between the stronger and the weaker, between the informed and the ignorant, which consists in this: through a deeper and entirely generous exchange, the strong or knowledgeable person proceeds as though the other person possessed a strength and knowledge equal to his own, thereby becoming an advisor, judge and instrument of redress.' Someone who sells his used car understands this principle very well, and so does the buyer; it is for this reason that they can almost always agree on what constitutes a just deal, even though they may not do all they can to ensure that it actually is entirely just. How can someone be unjust without knowing what justice means? What they both know, if they think about it, is that their transaction is just if and only if equals - in power, knowledge, and rights - might have agreed to it. The conditional tense is most appropriate, for justice assumes a condition of equality, which our exchanges must submit to." (At p. 70) 44 When one translates these observations into the proper approach to the determination of whether the provisions of a contract are unfair, one is driven to look at whether and to what extent each of the parties was empowered to understand and appreciate the nature of the bargain that was made and, in all the circumstances that pertained to them, the resulting bargain was fair. In one sense, the determination that the Court is asked to make in the circumstances of these proceedings is whether, if the applicant had put herself in the position of the respondent, she would, on behalf of the respondent, have entered into the contract that she seeks to impugn. 45 The factual situation is this: 1) At all times during the period of the last contract, the applicant was aware that it was to expire on a certain date. 2) Indeed, the applicant applied for at least one internal full-time position with the respondent during the period of that contract and one external full-time position. 3) There is no evidence that the applicant would not have entered into the contract if she had thought that her relationship with the respondent would come to an end when it expired. 4) There is no suggestion that the applicant was misled or was the subject of any misrepresentation by anyone on behalf of the respondent that her employment with the respondent would (as opposed to could) continue beyond the expiry of the term of the contract. 46 At most, the applicant had a hope or expectation that she might gain employment with the respondent beyond the term of the contract but that is not sufficient, in my opinion, to enable this Court to interfere with the contract in the manner sought by the applicant. In all the circumstances I would conclude that the contract, which the applicant seeks to impugn, was freely made between her and the respondent and that she understood and was fully aware of all of its provisions, including when it would come to an end. The contract was not unfair in any sense just because it was made for a fixed term. There is no other characteristic of the contract that renders it unfair for the purpose of s 106. 47 Whilst, as I have said, the contemporary employment milieu may be said to be unfortunate, or even unfair, with the emphasis on casualisation, fragmentation, a denial of long-term secure employment prospects, all in the name of "flexibility" and the advancement of the interests of industry and government, these circumstances cannot be transmitted in the context of these proceedings into the contract between the applicant and the respondent so as to render it unfair for the purpose of s 106 of the Act. 48 It follows, therefore, that the contract not being unfair, the proceedings should be dismissed. 49 The parties asked that I reserve costs and I shall do so accordingly. Orders 50 I make the following orders: 1) The applicant's summons is dismissed. 2) Costs are reserved. 3) Liberty to apply with respect to costs. 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