Fair Work Act 2009

s.217 - Enterprise Agreement

s.739 - Application to deal with a dispute

Application by Qantas Airways Limited & QF Cabin Crew Australia Pty Ltd

Qantas Airways Limited & QF Cabin Crew Australia Pty Ltd

Application to vary enterprise agreement to remove ambiguity or uncertainty - Dispute about a matter arising under the enterprise agreement

• [1] This decision concerns two applications relevant to an enterprise agreement known as the Flight Attendants' Association of Australia, Qantas Airways Limited and QF Cabin Crew Australia Pty Limited Enterprise Agreement 2022 (EBA11)[1] (EBA11).

• [2] EBA11 came into operation from 5 April 2022[2] and has a nominal expiry date of 29 March 2026.[3]

[3] On 24 May 2022, the Flight Attendants' Association of Australia (FAAA) made an application pursuant to s.739 of the Fair Work Act 2009 (FW Act) in respect of a dispute with Qantas Airways Limited (QAL) and QF Cabin Crew Australia Pty Ltd (QCCA) (collectively Qantas) (Dispute Application).

[4] The Dispute Application was made in accordance with clause 9 of Part A of EBA11, which sets out the dispute resolution procedure and, following compliance with the steps set out in clauses 9.1.1-9.1.3, confers jurisdiction on the Commission to resolve disputes by conciliation or other methods, and if unsuccessful, by arbitration.

[5] In the Dispute Application, the FAAA set out three matters that were in dispute:

• Whether Qantas' requirement that employees clear from sick leave on or before 8:00am two days prior to their return to duty is inconsistent with clause 25.10 of Part B, and whether Qantas can remove employees from duty that are not cleared from sick leave by that time (Clearance Dispute);

• Whether employees are entitled to a Z day following standby duty under clause 12.2 of Part B (Standby Dispute); and

• Whether Qantas can compel employees to confirm their attendance for duty between 15 hours and 4 hours prior to the commencement of duty under clause 8 of Part B (Contact Dispute).

[6] On 7 October 2022, Qantas made an application pursuant to s.217 of the FW Act to vary EBA11 to remove an ambiguity or uncertainty in relation to clause 12.2 of Part B of EBA11 as it is unclear whether the phrase "non-flying" includes a period of standby (Variation Application).

[7] In early November 2022, both matters were allocated to my chambers and were heard together on 8 March 2023.

• [8] While the parties were entitled to be represented in the Dispute Application,[4] I exercised my discretion to grant permission to both parties to be represented by a lawyer in the Variation Application, as I was satisfied as to the matters set out in s.596(2)(a) of the FW Act. The Applicant was represented by Mr P Boncardo. The Respondent was represented by Mr M Follett.

[9] Witness statements were tendered from the following persons:

• Ms Helen Gray, employed by QAL as Head of Cabin Crew Planning and Crewing Operations (Exhibits 1 and 9);

• Ms Patricia Byrne, employed by QAL as Manager, Cabin Crew Operations (Exhibit 2);

• Mr Steven Reed, employed by the FAAA as Manager Industrial Relations (Exhibits 3 and 4);

• Ms Lauren Fry, employed by QCCA as a Flight Attendant (Exhibit 4);

• Mr David Horsfall, employed by QAL as a Flight Attendant and President of the FAAA (Exhibit 6);

• Ms Julie Moody, employed by QAL as a Customer Service Manager and a Councilor in the FAAA (Exhibit 7); and

• Ms Teri O'Toole, Federal Secretary of the FAAA (Exhibit 8).

• [10] None of the above persons were required for cross examination, and the parties agreed that the evidence filed by the parties will comprise the evidence in both the Dispute Application and the Variation Application.[5]

[11] Prior to the hearing the parties resolved the Contact Dispute. Furthermore, in relation to the Clearance Dispute, Qantas had modified its position to removing an employee's duties if it has not been notified of the employee's return to duties from sick leave on or before 8:00am on the preceding day.

[12] The parties agreed on the following questions to be determined by arbitration in relation to the Clearance Dispute and the Standby Dispute:

1. Is the employer entitled to remove an employee's duties if the employer has not been notified of the employee's return to duties from sick leave on or before 8:00am on the preceding day?

• 2. In clause 12.2 of Part B of EBA11, does "non-flying" duty include "standby"?[6]

• [13] The parties submitted that the Variation Application ought to be determined first.[7] I consider this is an appropriate course, noting that if the Variation Application is granted, it will dispose of the Standby Dispute.[8]

• [14] QAL and QCCA are employers covered by EBA11 and have standing to make the Variation Application.[9]

[15] By the Variation Application, Qantas seeks:

(a) A finding that uncertainty arises in clause 12.2 of Part B of EBA11, as it is unclear whether the phrase "non-flying" in the second row of the first column of the table in clause 12.2 includes a period of standby; and

(b) upon finding that uncertainty arises in clause 12.2 of Part B of EBA11, exercise its discretion to remove that uncertainty by varying the Agreement in the manner proposed by the Qantas entities at Annexure 1.

• [16] Annexure 1 to the Variation Application is set out as follows[10]:

The minimum rest period at home base after completion of a pattern will be:

At home base, an employee will not be required to sign-off and subsequently sign-on on the same calendar day. Rest periods at home base may include designated Days Off.

Z day means a day wholly for minimum rest which has not already been designated as a designated duty free day.

Where an employee is not able to complete the minimum home base rest to which the employee is entitled before the planned report time of their next pattern or duty, the Company will remove the employee from the pattern or duty. An exception to this is where the employee advises the Company that the employee will fly the pattern or perform the duty to maintain their roster.

[17] Qantas also seeks an order that the variation comes into force retrospectively from the date that EBA11 came into operation, namely from 5 April 2022.

• [18] Qantas is an international and domestic airline that operates, on average, approximately 1,120 flights per week to more than 50 destinations.[11]

• [19] Qantas' international (or long haul) operations are primarily crewed by approximately 2,300 flight attendants employed by QAL and QCCA which operate out of three 'home bases' in Sydney, Melbourne, and Brisbane.[12]

• [20] Qantas structures its international fleet as 'Mainline' which refers to operations on the Airbus A330 aircraft, and 'Worldfleet' which refers to operations on the Airbus A380 Aircraft or Boeing 787-9 Dreamliners.[13]

• [21] In order to ensure it has sufficient crew available to crew flights, Qantas keeps a proportion of its crew in reserve, including on standby duties. Standby duties are periods where an employee is not required to attend their home base for the purpose of any other duty, but must be able to attend the airport, sign-on and be ready for departure within 120 minutes of being contacted.[14]

[22] As noted above, EBA11 commenced operation from 5 April 2022. It is structured in two parts:

• Part A, which sets out the framework of the agreement; and
• Part B, which sets out the terms and conditions of employment.

• [23] The structure of EBA11 differed from its three predecessor enterprise agreements[15], which were each structured as follows:

• Part A which set out the framework of the agreement and provisions that applied to all employees; and
• Part 1, which set out the terms and conditions of employment for QAL employees; and
• Part 2, which set out the terms and conditions of employment for QCCA employees.

• [24] The above structure was first implemented in EBA8 to accommodate the introduction of the A380 aircraft. Generally, part 1 contained conditions of employment for QAL crew that worked in Qantas' mainline which included (at that time) the A330, B767 and B747 aircraft, and part 2 contained conditions of employment that applied to QCCA crew that worked on the A380 and on mainline aircraft.[16] There was also the ability for QAL employees to 'transfer' to Part 2 conditions to work on the A380. In these circumstances, the conditions under Part 2 applied to transfer employees.[17]

[25] Clause 28 of Part 1 of EBA8 deals with reserve and standby duties. Clause 28.2.1 provides as follows:

An employee may be allocated to a standby duty of not more than 12 consecutive hours. The duty free time following a standby duty must not be less than 12 hours, provided that not more than one such standby duty shall commence in any one calendar day.

[26] Clause 10 of Part 2 of EBA8 deals with rest periods. Clause 10.2 provides as follows:

The minimum rest period at home base after completion of a pattern will be:

At home base, an employee will not be required to sign-off and subsequently sign-on on the same calendar day.

Rest periods at home base may include designated Days Off.

Where an employee is not able to complete the minimum home base rest to which the employee is entitled before the planned report time of their next pattern or duty, the Company will remove the employee from the pattern or duty.

An exception to this is where the employee advises the Company that the employee will fly the pattern or perform the duty to maintain their roster.

[27] Clause 14 of Part 2 of EBA8 deals with reserve and stand-by duties. Clause 14.3 provides as follows:

Standby periods at home may be rostered for one (1) or more consecutive periods but may not exceed four (4) consecutive periods of standby. The total duration of such standby periods will not exceed twelve (12) continuous hours. Rest provisions will be applied at the end of each standby period.

• [28] EBA9 came into operation from 20 June 2013 and had a nominal expiry date of 17 June 2016.[18]

[29] Clause 27 of Part 1 of EBA9 deals with reserve and standby duties. Clause 27.2.1 provides as follows:

An employee may be allocated to a standby duty of not more than 12 consecutive hours. The duty free time following a standby duty must not be less than 12 hours, provided that not more than one such standby duty shall commence in any one calendar day.

[30] Clause 12 of Part 2 of EBA9 deals with rest periods. Clause 12.2 provides as follows:

The minimum rest period at home base after completion of a pattern will be:

At home base, an employee will not be required to sign-off and subsequently sign-on on the same calendar day.

Rest periods at home base may include designated Days Off.

Where an employee is not able to complete the minimum home base rest to which the employee is entitled before the planned report time of their next pattern or duty, the Company will remove the employee from the pattern or duty.

An exception to this is where the employee advises the Company that the employee will fly the pattern or perform the duty to maintain their roster.

[31] Clause 16 of Part 2 of EBA9 deals with reserve and stand-by duties. Clause 16.3 provides as follows:

Standby periods at home may be rostered for one (1) or more consecutive periods but may not exceed four (4) consecutive periods of standby. The total duration of such standby periods will not exceed twelve (12) continuous hours. Rest provisions will be applied at the end of each standby period.

EBA10

• [32] Mr Reed was involved in the negotiations for EBA10 and stated that as part of negotiations for EBA10, the FAAA made a claim to have rest after non-flying duties 'measured' in days off rather than hours off at home base. Qantas agreed to this and introduced the concept of a "Z day" in Part 2 of EBA10 to reflect a day wholly for minimum rest which has not already been designated as a designated duty free day.[19]

• [33] Ms Byrne was part of the Qantas bargaining team for EBA10 and stated that during discussions for EBA10, the focus of the introduction of a Z day in Part 2 of EBA10 was to provide crew members with at least one full day free from duty in home base following flying patterns or training duties. Ms Byrne stated that there was never any discussion or suggestion that a crew member would be entitled to a Z day following standby duties.[20] Both Ms Gray and Ms Byrne stated it is unlikely Qantas would have agreed to apply a Z day following a period of standby, as it would have a significant cost and operational impact.[21]

[34] As part of its pre-approval steps for EBA10, Qantas provided explanatory material provided to its employees explaining the introduction of the Z day in Part 2 as follows:

Part 2 - Improved rest provisions: "Z days" providing a full day (24 hours) of rest at home base as a minimum will be introduced after all flying patterns along with improved inflight rest breaks. We will also reduce the contactability requirements - instead of being available for 24 hours on an "A" day this will be reduced to two blocks 0900-1100 and 1600-2100.[22]

Current provisions for home base rest are measured in hours. This often makes crew available on the very next day after the completion of a pattern. Introducing the concept of a Z day will ensure a full calendar day (24 hours) of rest in home base before any contact obligations are required.

This will include pattern/duty length of one, two, three & four days. The rest will be indicated on your roster with the letter "Z".

Z day means a day wholly for minimum rest which has not already been designated as a designated duty free day.

Rest periods at home base may include designated days off.[23]

• [36] EBA10 came into operation from 25 July 2017 and had a nominal expiry date of 17 June 2021.[24]

[37] Clause 27 of Part 1 of EBA10 deals with reserve and standby duties. Clause 27.2.1 provides as follows:

An employee may be allocated to a standby duty of not more than 12 consecutive hours. The duty free time following a standby duty must not be less than 12 hours, provided that not more than one such standby duty shall commence in any one calendar day.

[38] Clause 12 of Part 2 of EBA10 deals with rest periods. Clause 12.2 provides as follows:

The minimum rest period at home base after completion of a pattern will be:

At home base, an employee will not be required to sign-off and subsequently sign-on on the same calendar day.

Rest periods at home base may include designated Days Off.

Z day means a day wholly for minimum rest which has not already been designated as a designated duty free day.

Where an employee is not able to complete the minimum home base rest to which the employee is entitled before the planned report time of their next pattern or duty, the Company will remove the employee from the pattern or duty. An exception to this is where the employee advises the Company that the employee will fly the pattern or perform the duty to maintain their roster.

[39] Clause 17 of Part 2 of EBA10 deals with reserve, available spans and stand-by duties. Clause 17.5 provides as follows:

Standby periods at home may be rostered for one (1) or more consecutive periods but may not exceed four (4) consecutive periods of standby. The total duration of such standby periods will not exceed twelve (12) continuous hours. Rest provisions will be applied at the end of each standby period.

• [40] Ms Byrne stated that there were there were no changes to rest periods following standby for any employees upon the commencement of EBA10.[25]

• [41] Mr Reed stated that the FAAA accepted Qantas' way of dealing with days off following duties. Mr Reed also stated that upon the commencement of EBA10, the 12 hour rest period following standby continued to be applied in the same way because the Part 1 crew still had 12 hours rest after standby.[26]

• [42] Ms Gray stated that during negotiations for EBA11, the FAAA did not raise any concerns that the provision of a 12 hour rest after standby was not being correctly applied.[27]

• [43] Although Mr Reed stated that Qantas made it clear that in removing Part 1 that no Part 1 arrangements would be preserved or brought across to Part 2 (Part B in EBA11), he agreed with Ms Gray that at no stage during negotiations for EBA11 was the subject of Z days discussed.[28]

• [44] As part of its pre-approval steps for EBA11, Qantas provided the relevant employees with a range of documentary material. One document was directed to QAL employees to explain which clause in Part B of EBA11 is the corresponding provision in the (former) Part 1 of EBA10.[29] Qantas also provided an information pack explaining the key changes and the effect that the terms and conditions of EBA11 would have on QAL employees and QCCA employees.[30]

[45] The introductory wording under the heading of 'key changes' (in moving from EBA10 to EBA11) stated:

Over 80% of all crew already operate on the fair share rostering system and work rules contained in Part 2 of EBA 10. What we want is for our QAL A330 crew, who currently operate on a seniority system, to come over to the fair share system and work on the same conditions for the same number of hours as everyone else.

This change is important because having everyone on the fair share rostering system will enable crew to operate across all aircraft types (once everyone is multi-endorsed). This will give us crucial flexibility to manage the uncertainty we know we will face as we recover the international business.

To achieve this change, Part 1 of EBA10 (which contains the QAL A330 Seniority system) will no longer exist in EBA 11. All employees will be covered by 'Part B' of EBA 11 which are the same terms and conditions that currently exist in Part 2 of EBA 10 except for the changes identified elsewhere in this information pack.[31]

• [46] In relation to clause 12 rest periods, the explanatory table stated that there would be no change to existing entitlements for both QAL and QCCA employees.[32] In relation to clauses 17.6-17.10, the explanatory table stated that there would be no change to the standby provisions, other than to increase the minimum notice period from 90 minutes to 120 minutes.[33]

[47] As stated above, EBA11 came into operation from 5 April 2022 and has a nominal expiry date of 29 March 2026.

[48] Clause 10 of Part B of EBA11 deals with duty period limitations. Clause 10.4 provides as follows:

10.4 Duty Period Limitations will be as follows:

*Stand-by credits do not contribute to operating or deadheading duty hour period limitations

**provided that the operating sector doesn't exceed 14 hours

***in the event that the employee's nominated ground duty is Emergency Procedures with an examination component, the employee will be positioned the day prior to the ground duty but may position to home base at the completion of the ground duty component.

[49] Clause 12 of Part B of EBA11 deals with rest periods. Clause 12.2 provides as follows:

The minimum rest period at home base after completion of a pattern will be:

At home base, an employee will not be required to sign-off and subsequently sign-on on the same calendar day. Rest periods at home base may include designated Days Off.

Z day means a day wholly for minimum rest which has not already been designated as a designated duty free day.

Where an employee is not able to complete the minimum home base rest to which the employee is entitled before the planned report time of their next pattern or duty, the Company will remove the employee from the pattern or duty. An exception to this is where the employee advises the Company that the employee will fly the pattern or perform the duty to maintain their roster.

[50] Clause 16 of Part B of EBA11 deals with reassignable hours and pay protection. Clause 16.1 provides as follows:

On return from sick/carer's leave Qantas/QCCA will aim to reassign an employee's duties within the timeframe of their original planned pattern plus any available days immediately following the completion of the pattern. However, Qantas/QCCA reserves the right to utilise any available day to commence a duty (either a flying duty, stand by duty or ground duty) to reclaim work lost after an employee has reported fit for duty, up to a maximum of 21 days (offset period), exclusive of leave, from the first day the employee Is available duties after returning from sick/carers leave. This may result in roster disruption.

Recovery that extends into the next roster period shall be limited to one recovered flying offset per recovery occasion. This limitation does not apply to non-flying duties (e.g. stand-by or ground duties).

[51] Clause 17 of Part B of EBA11 deals with reserve, available spans and stand-by duties. Clause 17.8 provides as follows:

Standby periods at home may be rostered for one (1) or more consecutive periods but may not exceed four (4) consecutive periods of standby. The total duration of such standby periods will not exceed twelve (12) continuous hours. Rest provisions will be applied at the end of each standby period.

[52] Clause 25 of Part B of EBA11 deals with personal/carers leave. Clauses 25.7-25.17 deal specifically with sick leave. Clause 25.15 provides as follows:

An employee who, through personal illness, is unfit for flying duty but is declared fit for non-flying duty by a Company doctor may continue on sick leave or if a temporary ground staff position is available and is accepted by the employee, he or she must be paid the rate of pay prescribed in the relevant award or agreement.

• [53] Following the commencement of EBA11, Qantas provided information to relevant employees regarding the implementation of EBA11. In relation to standby, the information stated "12 hours rest is currently applied after a standby duty".[34]

[54] Qantas submitted that clause 12.2 of Part B of EBA11 provides for rest periods at an employee's home base "after the completion of a pattern". A pattern is defined in clause 34 of Part B of EBA11 as "a flight duty period, or sequence of flight duty periods with intervening rest periods, commencing and completing at the employee's home base".

[55] Qantas submitted that the minimum rest period after a "non-flying" duty type is a "Z day" which is a full day of rest not already designated as a duty free day.

[56] Qantas submitted that the parties are in dispute as to whether periods of "standby" constitute a "non-flying" duty, which is not defined in EBA11. Qantas submitted that the dispute has arisen because of the ambiguity or uncertainty on the face of the disputed clause, read in the context of EBA11 as a whole.

• [57] Qantas submitted that the relevant principles which apply to s.217 of the FW Act are well settled.[35] Qantas submitted that the Commission is not required to interpret the disputed clause to ascertain its actual or true meaning. Rather, the task before the Commission is to determine whether the disputed clause is capable of more than one meaning (ambiguity), or is in a state of not being definitely known or perfectly clear, or is doubtful or vague in its application (uncertainty).

[58] Qantas submitted that both parties seek the use of proxies to aid the proper construction. Qantas referred to the submissions of the FAAA and submitted that there is one proxy which suggests that standby duties are a form of non-flying duties and there are several others which suggest that standby duty is not a non-flying duty. In support of this submission, Qantas cited clauses 10.4, 12.2, and 25.15 of Part B of EBA11 which suggest standby duty is not a non-flying duty.

[59] Qantas submits that the ambiguity or uncertainty present in clause 12.2 of Part B of EBA11 is to be resolved by reference to the mutual intention of the parties who negotiated the clause. In this respect, Qantas submitted that the evidence as to the negotiations of EBA10 and EBA11 demonstrate that the mutual intention of the parties was not to provide a Z day following a period of standby, a practice which has not been disputed for at least five years.

[60] Qantas referred to the evidence of Ms Gray and Ms Byrne and cited the decision in United Voice v MSS Security in support for the proposition that if it can be concluded that the employer would not have agreed to an additional cost or benefit, it is an appropriate course to vary the agreement to ensure that the benefit is not payable.

[61] Qantas submitted that the proposed variation accords with the mutual intention of the parties and should be made to take effect from 5 April 2022.

[62] The FAAA submitted that s.217 of the FW Act confers a discretionary power on the Commission to vary an enterprise agreement to remove an ambiguity or uncertainty, subject to the precondition that the enterprise agreement contains ambiguity or uncertainty.

• [63] The FAAA submitted that the approach to ascertaining whether a provision was ambiguous or uncertain was summarised by March SDP in Beltana Highwall Mining Pty Ltd re Beltana No.1 Salaried Staff Certified Agreement 2001[36] and endorsed by the Federal Court in Bianco Walling.

[64] The FAAA submitted that the power is discretionary insofar as the Commission is not compelled, if it finds ambiguity or uncertainty, to make a determination varying the agreement. However, the power to vary an agreement is limited to removing the ambiguity or uncertainty.

[65] The FAAA submitted that relevant to the exercise of discretion will be any communications provided to employees prior to the vote in compliance (or attempted compliance) with s.180(5), and that any variation that removes or impacts the accrued rights of employees may be a factor militating against the exercise of the power or determining that any variation should only operate prospectively.

[66] The FAAA submitted that beyond merely pointing out that the construction of clause 12.2 of EBA11 is in dispute, Qantas has not demonstrated any ambiguity or uncertainty, and that any contention that the clause is ambiguous or uncertain is without merit.

[67] The FAAA submitted that clause 12.2 of Part B of EBA11 deals with rest periods and sets out in tabular form, the minimum rest periods which are afforded to employees after performing particular work patterns. The FAAA submitted that where an employee undertakes a "non-flying" duty type, they are entitled to a Z day, being a day wholly for minimum rest that has not already been designated as a designated duty free day.

[68] The FAAA submitted that the words "non-flying duty" plainly include a standby duty, referring to the final words in clause 16.1 of Part B of EBA11 which state "...This limitation does not apply to non-flying duties (e.g. stand-by or ground duties)."

[69] The FAAA submitted that clause 12.2 of Part B of EBA11 is pellucidly clear, is not capable of more than one meaning and that its meaning is definitely and surely known. In this respect, the FAAA submitted that the clause is neither ambiguous or uncertain and that the Variation Application should be dismissed.

[70] The FAAA submitted that while clause 10.4 of Part B of EBA11 differentiates between standby and non-flying for the purposes of duty limitation periods, non-flying in clause 12.2 is to be read in light of the definition which includes standby duty.

• [71] The FAAA cited the decisions Bradnams and Bianco Walling and submitted that the Commission will generally err on the side of finding ambiguity or uncertainty where there are arguable rival contentions advanced.[37]

[72] The FAAA submitted that the phrase "flight duty" is defined and that a duty that is not a species of flight duty is a non-flying duty, which is reflected in clause 16.1 of Part B of EBA11.

[73] The FAAA submitted that there is no evidence of any mutual intention between Qantas the employees to whom EBA11 covers and applies and that any reliance on mutual understanding of Z days and their use under EBA10 is misplaced as that approach was informed by Part 1 of EBA10 which was entirely expunged.

[74] In relation to the exercise of discretion, the FAAA submitted that the effect of Qantas' proposed variation is that it will result in no rest period following a period of standby - whether that is a Z day, 12 hours or otherwise, and that this weighs against the exercise of discretion to vary the clause in the event that ambiguity or uncertainty is found.

• [75] The FAAA did not oppose any variation operating retrospectively if the Variation Application is granted and the Commission determines to exercise its discretion to vary EBA11.[38]

[76] Qantas submitted that the true effect of the FAAA's submissions is to demonstrate the uncertainty (or ambiguity) in clause 12.2 of Part B of EBA11.

[77] Qantas submitted that while clause 16.1 identifies standby as a form of non-flying duties, clause 10.4 identifies standby as separate and distinct from non-flying duties, and that a similar observation can be made about clause 25.15. Qantas submitted that these clauses demonstrate, at the very least, that clause 12.2 is uncertain in that it is "doubtful" or "not definitively or surely known" as to whether non-flying duty includes standby duty.

[78] Qantas submitted that there was no amendment to clauses 12.2 or 17.8 in Part 2 of EBA10 in moving to EBA11, that there was no change to the custom or practice of applying a 12 hour rest period following a period of standby, and the explanatory material provided to employees supports Qantas' contentions.

[79] Qantas submitted that a variation consistent with clause 10.4 of Part B of EBA11 would resolve the matter, as well as resolving the issue raised by the FAAA concerning Qantas' proposed variation.

[80] Section 217 of the Act provides as follows:

217 Variation of an enterprise agreement to remove an ambiguity or uncertainty

• (1) The FWC may vary an enterprise agreement to remove an ambiguity or uncertainty on application by any of the following:

(a) one or more of the employers covered by the agreement;

(c) an employee organisation covered by the agreement.

• (2) If the FWC varies the enterprise agreement, the variation operates from the day specified in the decision to vary the agreement.

• [81] In Brockman Engineering Pty Ltd[39], Millhouse DP set out a helpful summary of the approach to ambiguity or uncertainty in the context of an application pursuant to s.217 as follows:

[13] The Commission's consideration of an application under s 217 involves two steps. The Commission must first identify whether there is an uncertainty or ambiguity in the Agreement, which is a jurisdictional pre-requisite to the exercise of discretion to vary the instrument. Secondly, if an ambiguity or uncertainty is identified, the Commission should consider whether to exercise its discretion to vary the Agreement. As to the first step, while there is some relationship between the terms ambiguity and uncertainty they are not synonyms. Both uncertainty and ambiguity may exist where a provision is capable of more than one construction. However, the mere existence of rival contentions is not a sufficient basis to conclude that there is ambiguity or uncertainty. There may be uncertainty in an enterprise agreement even when its terms are not ambiguous. The uncertainty may arise from the application of the unambiguous terms to a given set of circumstances. Further, "an" uncertainty in s 217 may be uncertainty of the enterprise agreement as a whole.

[14] The process of identifying ambiguity or uncertainty involves making an objective assessment of the relevant provision. As to that objective consideration, the Full Federal Court rejected the proposition that an examination of context and extrinsic material was not permissible until an ambiguity or uncertainty was first found to exist:

"In that objective consideration, an assessment of the matters relied upon for the competing contentions will be important, including evidence that the parties to the agreement had a common understanding as to the meaning of the terms they used in their agreement. A reading of the enterprise agreement as a whole may indicate ambiguity or uncertainty in one or more of its clauses. And, as was noted by the Full Bench in Tenix, "the [FWC] will generally err on the side of finding an ambiguity or uncertainty where there are rival contentions advanced and an arguable case is made out for more than one contention", at [31]."

[15] If an ambiguity or an uncertainty is identified, the Commission must consider whether to exercise its discretion to vary the Agreement to remove such ambiguity or uncertainty. This is distinct from giving effect to a new and substantive change not present when the enterprise agreement was made. In exercising its discretion, the Commission is to have regard to the mutual intention of the parties at the time the Agreement was made.

• [82] In relation to the identification of ambiguity or uncertainty, in Monash University T/A Monash University (Monash)[40], Bell DP distilled the relevant principles as follows:

[85] As to the 'first step', the following principles are discernible from the authorities:

1. The process of ascertaining ambiguity or uncertainty in an enterprise agreement is "distinct" from the process of construction, the latter of which involves determining the "true meaning" of a provision: Bianco Walling, [66] - [67].

1. Ambiguity exists when a provision in an enterprise agreement is capable of more than one meaning: Bianco Walling, [67].

1. Ambiguity may be apparent on the face of the document or may only become apparent when extrinsic evidence is adduced: Bianco Walling, [67].

1. A provision may be ambiguous even though capable of interpretation: Bianco Walling, [67].

1. Evidence of the parties "common intention" and the history of the impugned provisions are matters the Commission is permitted to have regard to in ascertaining whether ambiguity or uncertainty exists: Bianco Walling, [68].

1. The mere existence of rival contentions as to the meaning or application of a provision or provisions in an enterprise agreement is unlikely to be sufficient to indicate ambiguity or uncertainty for the purposes of s.217: Bianco Walling, [70].

1. And while the mere existence of rival contentions is insufficient to permit a finding of ambiguity or uncertainty, the Commission "will generally err on the side of finding an ambiguity or uncertainty where there are rival contentions advanced and an arguable case is made out for more than one contention" (original emphasis): Bianco Walling, [70].

1. The words "ambiguity" and "uncertainty" are not synonymous: Bianco Walling, [75].

"There may, for example, be uncertainty in an enterprise agreement even when its terms are not ambiguous. The uncertainty may arise from the application of the unambiguous terms to a given set of circumstances. The distinction between patent ambiguity (linguistic ambiguity) and latent ambiguity (ambiguity in application) provides an illustration by analogy" (citations omitted).

1. A form of "uncertainty" can extend to the common law analogy of uncertainty, where a provision might be found to be void, because no definite meaning can be put on that provision. However, "uncertainty" in s.217 is not so limited: Bianco Walling, [77].

[83] Applying the above principles, I am satisfied that the phrase "non-flying" in the table in clause 12.2 of Part B of EBA11 is ambiguous and uncertain for the following reasons.

[84] As set out above, the phrase "non-flying" is not defined in EBA11. Throughout EBA11, the phrase "non-flying" has been used inconsistently with different meanings. For example, in clauses 8.2 and 10.4 of Part B of EBA11, it is abundantly clear that "non-flying" duty does not include "standby" duty. Conversely, in clause 16.1 of Part B of EBA11, it is abundantly clear that "non-flying" incorporates "standby" duty. In relation to clause 25.15 of Part B of EBA11, I accept the submissions of Qantas that "non-flying" does not include standby. This is clear from the context that if an employee is unfit for flying duties but declared fit for a "non-flying" duty, that could not include "standby" duty, as the purpose of standby is to be ready and available to perform a flying duty if called upon.

[85] Both Qantas and the FAAA have pointed to one or more of the above clauses to support their (rival) contentions that "non-flying" duty in clause 12.2 of Part B of EBA11 includes, or does not include, standby duty.

[86] Unlike clauses 8.2, 10.4 and 16.1, clause 12.2 does not contain any express reference as to whether "non-flying" duty includes standby or not. Nor does the context assist in determining whether "non-flying" duty includes standby or not, as it does in clause 25.15.

• [87] In Tenix Defence Pty Limited re Tenix Defence Systems Pty Limited Certified Agreement 2001-2004[41], a Full Bench of the Australian Industrial Relations Commission accepted that context is important and that the identification of ambiguity or uncertainty is not confined to a word or words of a clause, but rather a combination of clauses may have that effect.[42]

• [88] In Shop Distributive and Allied Employees' Association v Woolworths Limited,[43] inconsistency in the use of the same or similar words arose where Gray ACJ stated:

...Typically, [enterprise] agreements are the product of hard negotiation, in which wording of particular clauses is often agreed without reference to other provisions of the same document. Provisions are commonly transmitted from one agreement to the next in a series, without regard to whether their terminology sits well with the words used in newly adopted terms. The use of other agreements, and awards, as precedents can often result in the borrowing of provisions, again without regard to whether the words used in them are consistent with the rest of the agreement under consideration. For these and other reasons, consistency will often be absent. It is easy to see that the same word can be used in different provisions with different meanings.[44]

• [89] In Bianco Walling, the Full Court held that ambiguity exists when a provision in an enterprise agreement is capable of more than one meaning, which may be apparent on the face of the document.[45] Furthermore, the threshold for finding ambiguity or uncertainty is not a high one.[46]

• [90] On an objective assessment of EBA11, when read as a whole,[47] I am satisfied that the phrase "non-flying" duty as it appears in clause 12.2 of Part B of EBA11 is ambiguous as it is capable of more than one meaning.

• [91] I am also satisfied that "non-flying" duty in clause 12.2 of Part B of EBA11 is uncertain in that it is not definitely or surely known and is doubtful or vague[48] as to whether it includes "standby" duty. As stated in Bianco Walling, if it is not possible to put any definite meaning on a clause, it is uncertain.[49]

• [92] As I have identified ambiguity and uncertainty in EBA11, it is now a matter of discretion as to whether EBA11 should be varied to remove the ambiguity or uncertainty. In exercising such a discretion, the Commission is to have regard to the mutual intention of the parties at the time EBA11 was made.[50]

• [93] In Australia Liquor, Hospitality and Miscellaneous Workers Union v Prestige Property Services Pty Ltd[51], Gray J held that the search for common (or mutual) intention is not to be found lightly, stating:

...For present purposes, I am prepared to accept that the construction of an award can be affected by a common understanding of the parties to it about a particular state of affairs. If such a common understanding existed when the award was made, it should not be departed from when the Court comes to construe the award at a subsequent time. Care must be taken, however, to distinguish a common understanding from common inadvertence. If the only reason why the government instrumentality rates were not paid at the Victorian Arts Centre was that neither the union nor the employer adverted to the possibility that there was an obligation to pay them, no common understanding results. In order to have an understanding, it is necessary that there be a meeting of minds, a consensus. There can be no meeting of minds, no consensus, if no-one has thought about the issue.[52]

[94] In SDA v Woolworths, in another decision by Gray ACJ, His Honour stated:

...There is authority that, if a provision has appeared in a series of agreements between the same parties, and if they can be shown to have conducted themselves according to a common understanding of the meaning of that provision, then it can be taken that they have agreed that the term should continue to have the commonly understood meaning in the current agreement. See Merchant Service Guild of Australia v Sydney Steam Collier Owners & Coal Stevedores Association (1958) 1 FLR 248 at 251 per Spicer CJ, 254 per Dunphy J and 257 per Morgan J, and Printing & Kindred Industries Union v Davies Bros Ltd (1986) 18 IR 444 at 452-453. It is necessary to take great care in the application of this limited principle, to avoid infringing the general principle that the conduct of parties to an agreement cannot be taken into account in construing the agreement. For the limited principle to operate, there must be clear evidence that the parties have acted upon a common understanding as to the meaning of the relevant provision and not for other reasons, such as common inadvertence as to its true meaning. See Australian Liquor, Hospitality and Miscellaneous Workers Union v Prestige Property Services Pty Ltd [2006] FCA 11 at [44].

[95] The evidence establishes that at the time EBA11 was made neither Qantas, the FAAA or the employees, agitated any variation to the existing (EBA10) rest provisions following a period of standby. Furthermore, Qantas communicated to its employees (and the FAAA) in unambiguous terms as part of its access period materials for EBA11, that there would not be any change to the existing (EBA10) rest provisions following periods of standby. This explanation was relevant to QAL employees working under Part 1 of EBA10 and QCCA employees and QAL Transfer Employees working under Part 2 of EBA10.

• [96] In relation to EBA10, although clause 17.5 of Part 2 of EBA10 is silent on the rest provision that follows a period of standby, the evidence of Mr Reed was that notwithstanding the introduction of a Z day in clause 12.2 of Part 2 of EBA10, the FAAA and Qantas had an arrangement (or common understanding) that the rest provision to be applied under clause 17.5 was to be consistent with the rest provision following a period standby under clause 27.2.1 of Part 1 of EBA10, namely 12 hours.[53] The effect of that common understanding is that "non-flying" duty in clause 12.2 of Part 2 of EBA10 does not include standby duty. The evidence is clear that that common understanding was maintained in moving from EBA10 to EBA11.

• [97] There is no suggestion by the FAAA that the way in which the rest provisions following standby under Part 2 of EBA10 were applied over a period of almost five years was contrary to the terms of EBA10.[54]

[98] Rather, the FAAA contends that as the express reference to 12 hours in Part 1 of EBA10 no longer exists, the common understanding that existed from the commencement of EBA10 (when the concept of the Z day was introduced) should now be abandoned. As stated by Gray J in LHMWU v Prestige Property, "if a common understanding existed when the award was made, it should not be departed from."

• [99] For these reasons, it is my view that the objectively ascertained mutual intention of parties is that "non-flying" duty in clause 12.2 of Part B of EBA11 does not include a period of standby duty. This is consistent with how the parties have historically applied the provision, and the explanation that was provided by Qantas to the employees who voted to approve EBA11.[55]

[100] Having found that the jurisidictional pre-requisite for the exercise of discretion under s.217 has been satisfied, and having objectively ascertained the mutual intention of the parties at the time EBA11 was made, I am satisfied that I should exercise my discretion to vary EBA to remove the ambiguity or uncertainty.

• [101] In terms of the variation proposed by Qantas in the Variation Application, I am not satisfied that will remove the ambiguity or uncertainty. However, the Commission is not limited to the form of an application before it. Having identified an ambiguity or uncertainty, the Commission is empowered to remove it in a manner which gives effect to the mutual intention of the parties.[56]

[102] In my view, and as proposed by counsel for Qantas in submissions in reply, the table in clause 12.2 of Part B of EBA11 should be varied in a manner similar to the table in clause 10.4 of Part B of EBA11, to insert an additional row for standby as follows:

The minimum rest period at home base after completion of a pattern will be:

• [103] In relation to the operative date of the variation, the FAAA did not oppose any order operating retrospectively. Noting that the mutual intention of the parties is to be objectively ascertained as at the time the agreement is made, it is my view the variation should operate retrospectively from the date of commencement of EBA11, namely 5 April 2022.[57]

• [104] For the reasons set out above, I find there is ambiguity and uncertainty in EBA11 that the ambiguity and uncertainty can be removed by varying EBA11in the terms of the Order[58] issued with this decision.

[105] The variation will take effect from 5 April 2022.

[106] Having regard to my determination of the Variation Application, the only matter for determination pursuant to the Dispute Application is the Clearance Dispute.

[107] As noted above, the Clearance Dispute concerns whether Qantas' requirement that employees clear from sick leave on or before 8:00am on the day preceding their return to duty is inconsistent with clause 25.10 of Part B of EBA11 (or otherwise) and whether Qantas can remove employees from duty that are not cleared from sick leave by that time.

[108] The relevant background is undisputed and can be set out as follows.

• [109] Prior to the commencement of EBA11, employees covered by Part 1 conditions could 'bid' for trips in Open Time. For Part 1 employees, bids for Open Time closed at 8:00am two days prior to the day of the trip. If an employee was on personal leave, their pattern or duty would be removed and placed into Open time at the normal closure of Open Time for that 24 hour period. In contrast, employees covered by Part 2 conditions could 'bid' for trips in Open Time right up to the time of departure.[59]

[110] The requirement that a pattern or duty be placed into Open Time at 8:00am two days prior to the day of trip for employees on personal provided an express provision under the enterprise agreement permitting the removal employees from trips if they had not cleared from sick leave by that time.

[111] The Open Time provision as it appeared in Part 1 of EBA8, EBA9 and EBA10, no longer exists in EBA11. The Open Time provision in EBA11 essentially replicates the former Part 2 provision.

• [112] Following the approval of EBA11 by the Commission, Qantas and the FAAA had various meetings and/or discussions regarding the implementation of EBA11. Arising out of those discussions, Qantas sent correspondence to the FAAA on 16 May 2022 explaining its position in relation clearance from sick leave with reference to the practice that had been in place throughout EBA8, EBA9 and EBA10.[60]

• [113] On 19 May 2022, Qantas provided the FAAA with documentation that it proposed to issue to employees covered by EBA11 regarding the implementation of EBA11.[61] One of the documents Qantas provided to the FAAA was a slide presentation (Slide Deck) which included the following information:

• • Crew should continue to clear from sick leave before 0800 two days prior to your next duty. If you have not confirmed by this time, we will need to remove your trip for inclusion in the open time allocation process.[62]

• [114] On 20 May 2023, the FAAA sent correspondence to Qantas disputing Qantas' position on the basis that the clearing from sick leave requirement is inconsistent with EBA11.[63]

• [115] It is not in dispute that Qantas has removed employees from trips where they have not cleared from sick leave by 8:00am two days prior to their next duty.[64]

[116] Clause 3.13 of Part B of EBA11 provides as follows:

3.13 Removal (or dropping of duties) or pay protection

(a) Fails to meet or fulfill a recognised responsibility;

(b) Fails to provide a medical certificate as provided in clause 25.7; or

When an employee is deemed unavailable for the first day of the duty from which he/she was removed and for any subsequent day of such, until such time as the employee notifies the company of his/her availability. Availability commences on the first full calendar day following the notification of availability.

The employee does not accrue either projected hours or hours for additional hourly pay during the period of unavailability.

The employee's company maximum hours, projected hours and hours for the purpose of triggering additional hourly pay (under clause 3.) must be adjusted by deducting the duty hour credits lost due to unavailability. The duty hour credits lost are the applicable duty hour credits value of the duty divided by the days of such duty multiplied by the days of unavailability.

For the purposes of this clause, the employee's projected hours for the purposes of triggering additional hourly pay (under clause 3.5) are reduced by deducting 220 (the average line value) divided by 38 for each day of such unavailability.

This may result in a negative pay adjustment as outlined in clause 3.11.

(a) requests, with the approval of the company, to remove (or drop) pattern/s down to 165 hours per 56 day bid period for a full time employee, 124 hours for 75% part-time employees and 83 hours for 50% part-time employees; or

(b) rejects or elects to drop pay protection (recoverable hours) under clause 16, the employee's company maximum hours, projected hours and hours for the purpose of triggering additional hourly pay (under clause 3,5) must be adjusted by the hours dropped.

This may result in a negative pay adjustment as outlined in clause 3.11.

[117] Clause 8.3 of Part B of EBA11 provides as follows:

8.3 Contactability-for the purpose of assigning a duty or pattern during Available Span (AV Span), Reserve Line or for Pay Protection

On an 'A' day at home base, crew must remain contactable during 0900 - 1100 and 1600 - 2100. Qantas/QCCA will make contact up to 1100 or 2100 to offer or assign a duty.

All assignments will require a minimum of 8 hours' notice commencing from either 1100 or 2100:

• 0900 to 1100 (8 hours from completion of period, ie, 0900+10 hrs, 1100+8 hrs)

• 1600 to 2100 (8 hours from completion of period, ie. 2100+8 hrs, 1600+13 hrs)

If an employee fails to be contactable during these times, they will forgoe the minimum 8 hours' notice and it will be considered to have commenced from either 1100 or 2100 (whichever contactable period Qantas/QCCA attempted to make contact).

Once an employee has accepted a duty, the employee is no longer required to be contactable during these periods, including where an employee accepts a duty for the A day earlier or outside these the contact periods.

[118] Clause 9.3 of Part B of EBA11 provides as follows:

9.3 The total hours of an employee's planned roster as allocated prior to the start of the bid period may not be changed by the Company except as a result of unplanned changes to an employee's allocated patterns after the commencement of the roster period, such as sick leave, pattern cancellation or change, upline disruption, operationally urgent requirements or at the request of the employee.

[119] Clauses 13.1-13.3 of Part B of EBA11 provide as follows:

13.1 Employees will be allocated rosters on a fair share basis.

13.2 Employees will be allocated a roster which may comprise of flying patterns, reserve and/or available spans (AV span) (or ground duties or leave days in accordance with this Agreement).

13.3 Employees must fly each pattern he/she is allocated unless they are removed from the by Qantas/QCCA or with the approval of Qantas/QCCA.

[120] Clauses 25.10 and 25.11 of Part B of EBA11 provide as follows:

25.10 An employee resuming duty after any period of sick leave must advise the Company on the day preceding the return to duty.

25.11 Sick leave commences on the first day of scheduled availability to the Company and continues until, but not including, the first full day on which the Company has been notified that the employee is ready and physically qualified for duty.

[121] Clause 34 of Part B of EBA11 defines "pattern" as follows:

Pattern means a flight duty period, or sequence of flight duty periods with intervening rest periods, commencing and completing at the employee's base.

[122] The FAAA submitted that clause 25.10 of Part B of EBA11 does not stipulate that employees are to contact Qantas by 8:00am on the day prior to returning to work after a period of sick leave but obliges the employee to contact Qantas prior to 11:59pm on the day preceding any return to duty.

[123] The FAAA submitted that Qantas' direction to its employees to do so by 8:00am (or otherwise prior to 11:59pm) on the day before they return to duty is unlawful as it is not authorised by, and is otherwise contrary to, EBA11.

[124] The FAAA submitted that once the notification of return to duty is given, then clause 25.11 determines that the employee is no longer on sick leave from the next day.

[125] The FAAA referred to clauses 3.13 and 9.3 and submitted that neither of those clauses permit Qantas to remove an employee from duty in circumstances where the employee does not provide notification by 8:00am on the day prior to their return to duty, but otherwise complies with clause 25.10 by giving notice prior by 11:59pm.

[126] In relation to clause 3.13, the FAA submitted that it sets out (exhaustively) the circumstances in which an employee can be removed from duty and that none of the circumstances contained therein permit the removal from duty in the manner contended for by Qantas. However, the FAAA accepted that if an employee did not comply with clause 25.10, that would permit removal from duty as it would constitute a failure to meet or fulfil a responsibility.

• [127] In relation to clause 9.3, the FAAA submitted that an employee complying with clause 25.10 does not constitute an unplanned change, but accepted in some circumstances a late notification may constitute an operationally urgent requirement to change a roster.[65]

• [128] The FAAA submitted that the resolution of the dispute requires the Commission to determine the proper construction of clause 25.10. The FAAA submitted that the principles applicable to the construction of enterprise agreements are well settled and were compendiously stated by Bromwich J in ARTBUI v Sydney Trains.[66]

[129] The FAAA submitted that the Commission should resolve the dispute by determining that employees are not required to contact Qantas by 8:00am on the day preceding their return from sick leave, and that Qantas is not entitled to remove an employee's duties where they have been notified at any time on the day preceding a return from sick leave.

[130] Qantas accepts that the Slide Deck does inform employees that they should continue to clear for duty before 8:00am two days prior to their next duty, but submits this was not intended to be, and is not, a direction to do so, or a contention that clause 25.10 requires it.

[131] Qantas agrees with the FAAA that clause 25.10 only requires employees to clear from sick leave "at some point on the day prior."

• [132] However, Qantas submitted that the FAAA has not identified any provision in EBA11 prohibiting Qantas from removing duties from employees who do not clear from sick leave by 8:00am on the preceding day, a course of action which is open to it in the exercise of its managerial prerogative. Qantas referred to the decisions in Bruce Steenstra v J.J. Richards & Sons Pty Ltd[67] and Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Telstra Corporation Limited[68] in support of its contention that the arrangement of hours of work, consistent with industrial instruments, is a matter falling within the scope of managerial prerogative.

[133] Qantas submitted that clause 3.13 is not relevant to the circumstances as it relates to the protection of pay and circumstances that may lead to a negative pay adjustment. Qantas submitted that in the event an employee is removed from duties as a result of not clearing for duty by 8:00am on the preceding day, they would lose a pattern (or part of a pattern) but there would not be any loss of pay.

[134] In relation to clause 9.3, Qantas submitted that while the clause permits a change of total hours over a planned roster due to an unplanned change such as sick leave or an operationally urgent requirement, the clause does not apply if the reduced hours were reassigned elsewhere within the planned roster.

[135] Qantas submitted that the cut-off time of 8:00am on the day prior is set so that Qantas knows which employees will not be returning in order to contact replacement employees within the 9:00am to 11:00am contact window in clause 8.3.

[136] Qantas submitted that clause 13.3 exclusively recognises its prerogative to remove an employee from any pattern at any time.

[137] Qantas submitted that there is no reasonable basis for the contention that it is precluded or prohibited from removing trips from employees who do not clear from sick leave by 8:00am on the day before their return to duty.

[138] In reply, the FAAA submitted that clause 9.3 sets out the rule, and exceptions to the rule, when an employee can have hours taken off them and removed from duty. The FAAA further submitted that clause 9.3 sets out when Qantas can change an employee's allocated patterns and that an employee complying with clause 25.10 cannot be a matter that triggers clause 9.3.

[139] The FAAA submitted that clause 13.3 does not give any power or authority for Qantas to remove an employee from a pattern. It simply states that an employee is required to fly their pattern unless they have been removed.

[140] The FAA submitted that clause 8.3 does not advance the matter and whether an employee can be removed from duty after returning from sick leave is determined by reference to clauses 25.10 and clause 9.3.

Principles of construction of enterprise agreements

[141] The dispute before the Commission concerns the proper construction of clauses in the 2020 Agreement.

• [142] The principles relevant to the approach that the Commission should take to the construction of enterprise agreements was set out in the decision of a Full Bench of the Commission in "Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU) v Berri Pty Ltd[69] (Berri) as follows:

1. The construction of an enterprise agreement, like that of a statute or contract, begins with a consideration of the ordinary meaning of the relevant words. The resolution of a disputed construction of an agreement will turn on the language of the agreement having regard to its context and purpose. Context might appear from: (i) the text of the agreement viewed as a whole; (ii) the disputed provision's place and arrangement in the agreement; (iii) the legislative context under which the agreement was made and in which it operates.

1. The task of interpreting an agreement does not involve rewriting the agreement to achieve what might be regarded as a fair or just outcome. The task is always one of interpreting the agreement produced by parties.

1. The common intention of the parties is sought to be identified objectively, that is by reference to that which a reasonable person would understand by the language the parties have used to express their agreement, without regard to the subjective intentions or expectations of the parties.

1. The fact that the instrument being construed is an enterprise agreement made pursuant to Part 2-4 of the FW Act is itself an important contextual consideration. It may be inferred that such agreements are intended to establish binding obligations.

1. The FW Act does not speak in terms of the 'parties' to enterprise agreements made pursuant to Part 2-4 agreements, rather it refers to the persons and organisations who are 'covered by' such agreements. Relevantly s.172(2)(a) provides that an employer may make an enterprise agreement 'with the employees who are employed at the time the agreement is made and who will be covered by the agreement'. Section 182(1) provides that an agreement is 'made' if the employees to be covered by the agreement 'have been asked to approve the agreement and a majority of those employees who cast a valid vote approve the agreement'. This is so because an enterprise agreement is 'made' when a majority of the employees asked to approve the agreement cast a valid vote to approve the agreement.

1. Enterprise agreements are not instruments to which the Acts Interpretation Act 1901 (Cth) applies, however the modes of textual analysis developed in the general law may assist in the interpretation of enterprise agreements. An overly technical approach to interpretation should be avoided and consequently some general principles of statutory construction may have less force in the context of construing an enterprise agreement.

1. In construing an enterprise agreement it is first necessary to determine whether an agreement has a plain meaning or it is ambiguous or susceptible of more than one meaning.

1. Regard may be had to evidence of surrounding circumstances to assist in determining whether an ambiguity exists.

1. If the agreement has a plain meaning, evidence of the surrounding circumstances will not be admitted to contradict the plain language of the agreement.

1. If the language of the agreement is ambiguous or susceptible of more than one meaning then evidence of the surrounding circumstance will be admissible to aide the interpretation of the agreement.

1. The admissibility of evidence of the surrounding circumstances is limited to evidence tending to establish objective background facts which were known to both parties which inform the subject matter of the agreement. Evidence of such objective facts is to be distinguished from evidence of the subjective intentions of the parties, such as statements and actions of the parties which are reflective of their actual intentions and expectations.

1. Evidence of objective background facts will include: (i) evidence of prior negotiations to the extent that the negotiations tend to establish objective background facts known to all parties and the subject matter of the agreement; (ii) notorious facts of which knowledge is to be presumed; and (iii) evidence of matters in common contemplation and constituting a common assumption.

1. The diversity of interests involved in the negotiation and making of enterprise agreements (see point 4 above) warrants the adoption of a cautious approach to the admission and reliance upon the evidence of prior negotiations and the positions advanced during the negotiation process. Evidence as to what the employees covered by the agreement were told (either during the course of the negotiations or pursuant to s.180(5) of the FW Act) may be of more assistance than evidence of the bargaining positions taken by the employer or a bargaining representative during the negotiation of the agreement.

1. Admissible extrinsic material may be used to aid the interpretation of a provision in an enterprise agreement with a disputed meaning, but it cannot be used to disregard or rewrite the provision in order to give effect to an externally derived conception of what the parties' intention or purpose was.

1. In the industrial context it has been accepted that, in some circumstances, subsequent conduct may be relevant to the interpretation of an industrial instrument. But such post-agreement conduct must be such as to show that there has been a meeting of minds, a consensus. Post-agreement conduct which amounts to little more than the absence of a complaint or common inadvertence is insufficient to establish a common understanding.

• [143] In Workpac[70], the Full Court of the Federal Court in Skene succinctly restated the principles as follows:

"The starting point for interpretation of an enterprise agreement is the ordinary meaning of the words, read as a whole and in context. The interpretation "...turns on the language of the particular agreement, understood in the light of its industrial context and purpose ...". The words are not to be interpreted in a vacuum divorced from industrial realities; rather, industrial agreements are made for various industries in the light of the customs and working conditions of each, and they are frequently couched in terms intelligible to the parties but without the careful attention to form and draftsmanship that one expects to find in an Act of Parliament. To similar effect, it has been said that the framers of such documents were likely of a "practical bent of mind" and may well have been more concerned with expressing an intention in a way likely to be understood in the relevant industry rather than with legal niceties and jargon, so that a purposive approach to interpretation is appropriate and a narrow or pedantic approach is misplaced."

[144] The Clearance Dispute concerns whether Qantas' requirement that employees clear from sick leave on or before 8:00am on the day preceding their return to duty is inconsistent with clause 25.10 of Part B of EBA11 (or otherwise) and whether Qantas can remove employees from duty that are not cleared from sick leave by that time.

• [145] As stated above where an employee does not clear from sick leave by 8:00am on the preceding day, if Qantas removes an employee from a pattern (or flight duty), the employee will not receive any loss of pay and will get the full hours credited to them.[71]

[146] The resolution of the Clearance Dispute necessarily involves the proper construction of the relevant provisions of EBA11.

[147] As set out in Berri, the construction of an enterprise agreement begins with a consideration of the ordinary meaning of the relevant words. Further, it is necessary to determine whether an agreement has a plain meaning or if it is ambiguous or susceptible of more than one meaning.

[148] For the reasons that follow, Qantas' requirement that employees clear from sick leave on or before 8:00am on the day preceding their return to duty is not inconsistent with clause 25.10 of Part B of EBA11 (or otherwise). Furthermore, Qantas can remove employees from duty that are not cleared from sick leave by that time.

[149] Clause 25.10 of Part B of EBA11 is unambiguously clear. It simply requires employees to advise Qantas of their return from sick leave on the day preceding the return to duty. There is no time limitation prescribed under the clause as to when that notification must be made. It is clear, and Qantas accepts, that it can occur at any point on the preceding day.

[150] The crux of the FAAA's case is that so long as an employee clears from sick leave by 11:59pm on the preceding day, then they have complied with the requirement of clause 25.10 and cannot be removed from flight duty, unless one of circumstances in clause 9.3 arises. In this respect, the FAAA submits that compliance with clause 25.10 (at any time throughout preceding day) would not trigger an unplanned change.

[151] While it is correct to say that in those circumstances an employee will have complied with clause 25.10, that does not mean that they cannot be removed from a pattern if they have not cleared from sick leave by a time (in this case 8:00am) reasonably stipulated by Qantas.

[152] The effect of the FAAA's submissions is that they overlook the minimum notice period that Qantas is required to provide to employees under clause 8.3.

[153] Clause 8.3 of Part B of EBA11 requires Qantas to provide employees with a minimum of 8 hours' notice when assigning a duty or pattern to an employee on an 'A' day and provides for two contact windows to assign employees a duty or pattern: 9:00am to 11:00am and 4:00pm to 9:00pm.

[154] It is clear the purpose of clause 8.3 is to ensure that a sufficient number of employees can be assigned duty or pattern in response to Qantas' operational requirements. If at the commencement of the contact window in clause 8.3, Qantas does not have certainty as to whether an employee will return from a period of sick leave by the next day, Qantas can remove the employee from a pattern pursuant to clause 13.3 and/or through the exercise of managerial prerogative.

• [155] While the FAAA submitted that clause 13.3 does not give any power or authority for Qantas to remove an employee from a pattern and that it simply states that an employee is required to fly their pattern unless they have been removed, I do not accept that submission. In my view clause 13.3 is clear on the ordinary meaning of its words and provides for three matters: (i) that an employee must fly each pattern allocated; (2) that it permits Qantas to remove an employee from any pattern at any time, subject to the constraint in clause 9.3;[72] and (3) that it permits Qantas to approve an employee not to fly a pattern.

[156] If my construction of clause 13.3 is wrong, it nonetheless contemplates that an employee may be removed from a pattern by Qantas under some other provision or principle.

• [157] In Construction, Forestry, Mining and Energy Union v HWE Mining Pty Limited[73] Lawler VP set out a summary of the law of managerial prerogative as follows:

'[7] The law recognises that there is an area of managerial prerogative in which an employer has the right to make decisions on how to manage their business. In Re Cram, ex parte N.S.W. Colliery Proprietors Association Limited the High Court observed that "many management decisions, once viewed as the sole prerogative of management, are now correctly seen as directly affecting the relationship of employer and employee". That case was concerned with whether the jurisdiction of the federal tribunal (under the then legislation based on s.51(xxxv) of the Constitution) to make an award in settlement of a dispute was constitutionally limited so as to prevent any interference with managerial decisions. The High Court rejected any such limitation, observing:

"... we reject the suggestion, based on the remarks of Barwick C.J. in Melbourne & Metropolitan Tramways Board, that managerial decisions stand wholly outside the area of industrial disputes and industrial matters. There is no basis for making such an implication. It is an implication which is so imprecise as to be incapable of yielding any satisfactory criterion of jurisdiction: see Federated Clerks Union. Indeed, the difficulty of making such an implication is accentuated by the fact that the extended definition of 'industrial matters' proceeds on the footing that many management decisions are capable of generating an industrial dispute.

These considerations indicate that the objection voiced by O'Connor J. in Clancy to the regulation and control of business enterprises by industrial tribunals is not a matter that goes to the jurisdiction of the tribunals. Rather it is an argument why an industrial tribunal should exercise caution before it makes an award in settlement of a dispute where that award amounts to a substantial interference with the autonomy of management to decide how the business enterprise shall be efficiently conducted."

[8] Subject to express terms, there is an implied term in the contract of employment that the employee will comply with the lawful and reasonable directions of the employer. This is one of the principal ways in which the employer's managerial prerogative arises from a legal perspective and forms the basis on which an employer may be said to have a right to make and vary policies that employees are required to observe.

[9] As was observed by the Full Bench in Woolworths v Brown:

"[24] In the modern era employers face an often bewildering array of statutory obligations in relation to matters such as health and safety, discrimination, taxation, trade practices and fair trading to mention the most obvious examples. Employers face potential liability arising from their common law duty of care to their employees and to members of the public. Employers may be subject to contractual obligations that require them to conduct their business in a particular way or to meet particular standards or observe particular constraints. For these reasons it is entirely reasonable, and often necessary, for employers to put in place policies, with which employees must comply, to facilitate the employer's compliance with its obligations and duties."

[10] However, managerial prerogative in relation to employees (including the employer's right to make and vary policies that employees are required to observe) is subject to legal constraints. It may be constrained by statute or the terms of an award. It may also be constrained by the terms of a contract of employment or a statutory agreement that the employer chooses to make. For example, an enterprise agreement might provide that all work must be carried out in accordance with a roster pattern specified in the agreement. In that example, unless the agreement also confers a right on the employer to vary the roster pattern, the employer has bound itself not to require employees to work a different roster pattern. In particular, an employer can bind itself in a statutory collective agreement not to change a policy or policies without, for example, the agreement of a relevant union or a majority of employees.

[11] If an employer's exercise of managerial prerogative is not prevented by statute, an award, a statutory agreement or the contract of employment, the basis for a tribunal such as Fair Work Australia, acting as an arbitrator of a dispute, interfering with what would otherwise be a lawful exercise of managerial prerogative (such as the making or varying of a policy which employees are required to observe) was laid down Australian Federated Union of Locomotive Enginemen v State Rail Authority of New South Wales (XPT case):

"It seems to us that the proper test to be applied and which has been applied for many years by the Commission is for the Commission to examine all the facts and not to interfere with the right of an employer to manage his own business unless he is seeking from the employees something which is unjust or unreasonable. The test of injustice or unreasonableness would embrace matters of safety and health because a requirement by an employer for an employee to perform work which was unsafe or might damage the health of the employee would be both unjust and unreasonable. The ACTU submitted to us that we should apply the test as to whether the demand of the employer was just and equitable having regard to all the circumstances. It is our view that under any given set of facts the test suggested by the ACTU would not lead to a different decision from the test which the Commission has applied over time. Accordingly in reaching our decision we have approached the matter from the point of view of making a judgement whether the request of the SRA that the XPT be manned by one man is unjust or unreasonable."

[12] I proceed on the basis that an exercise of managerial prerogative will not be unreasonable in this sense if a reasonable person in the position of the employer, could have made the decision in question.

[158] In CEPU v Telstra, Smith C held that the arrangement of hours of work, consistent with industrial instruments, is clearly a matter falling within the scope of managerial prerogative.

[159] In the absence of an express provision to the contrary, I accept that submissions of Qantas that its requirement for employees clear from sick leave by 8:00am on the preceding day falls within the scope of managerial prerogative.

[160] However, the exercise of managerial prerogative is subject to any constraints in the terms of EBA11. One such constraint is found in clause 9.3. Clause 9.3 of Part B of EBA11 does not allow Qantas to change the total hours of an employee's planned roster except as a result of unplanned changes to the employee's allocated patterns after the commencement of the roster period such as sick leave, pattern cancellation or change, upline disruption, operationally urgent requirements or at the request of the employee.

[161] Where the removal of a pattern results in a change to the total hours of the employee's planned roster after the commencement of the roster, then in my view that would constitute an unplanned change under clause 9.3 to the employee's allocated patterns due to sick leave and/or an operationally urgent requirement.

[162] Finally in relation to clause 3.13, I accept the Qantas' submission that this has no bearing on the matter before me.

[163] For the foregoing reasons, Qantas' requirement that employees clear from sick leave on or before 8:00am on the day preceding their return to duty is not inconsistent with clause 25.10 of Part B of EBA11 (or any other provision of EBA11). Furthermore, the terms of EBA11 do not prohibit Qantas from removing an employee from a pattern where they have not cleared from sick leave by that time.

[164] The answer to the agreed question for arbitration is:

Is the employer entitled to remove an employee's duties if the employer has not been notified of the employee's return to duties from sick leave on or before 8:00am on the preceding day?

P Boncardo of counsel for the Flight Attendants' Association of Australia.

M Follett of counsel for the Qantas Airways Limited and QF Cabin Crew Australia Pty Ltd_._

[2] [2022] FWCA 1099 at [4].

[4] See clause 9.10 of the 2022 Agreement.

[8] A similar approach was adopted by the Full Bench in The Hon. Christian Porter MP, Attorney General and Minister for Industrial Relations v Metropolitan Fire and Emergency Services Board; United Firefighters' Union of Australia [2019] FWCFB 6255 at [55]. See also "Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU) v Toyota Motor Corporation Australia [2011] FWAFB 2132 at [15].

[9] See s.217(1)(a) of the FW Act and clause 4 of EBA11.

[10] Qantas' proposed variation is highlighted in yellow.

[15] Flight Attendants' Association of Australia - International Division, Qantas Airways Limited and QF Cabin Crew Australia Pty Limited Workplace Agreement 2007 (EBA8) (EBA8); Flight Attendants' Association of Australia - International Division, Qantas Airways Limited and QF Cabin Crew Australia Pty Limited Enterprise Agreement 2012 (EBA9) (EBA9); Flight Attendants' Association of Australia - International Division, Qantas Airways Limited and QF Cabin Crew Australia Pty Limited Enterprise Agreement 2017 (EBA10) (EBA10).

[16] Exhibit 1 at [18]-[19]; Exhibit 4 at [6]- [11].

[17] See EBA8 (Part A, clauses 4 and 7; Part 1, clauses 1 and 7; Part 2, clause 1); EBA9 (Part A, clauses 4 and 6; Part 1, clause 4; Part 2, clauses 1, 4 and 32); EBA10 (Part A, clauses 4 and 6; Part 1, clauses 1 and 4; Part 2, clauses 1, 4 and 33).

[18] [2013] FWCA 3786 at [6].

[21] Exhibit 2 at [23]-[29], Exhibit 9 at [5], [23]-[34].

[24] [2017] FWCA 3775 at [5].

[28] Exhibit 1 at [49]-[51]; Exhibit 3 at [18]-[24].

[29] Exhibit 4 at [28], Annexure SR5.

[30] Exhibit 4 at [29], Annexure SR6.

[31] Exhibit 4 at [30], Annexure SR6 at p.2.

[34] Exhibit 4 at [64]-[65], Annexure SR8.

[35] Citing United Voice v MSS Security Pty Ltd t/as MSS Security [2016] FWCFB 4979 (United Voice v MSS Security); Re Bradnams Windows and Doors Pty Ltd [2019] FWCA 979 (Bradnams) and Bianco Walling Pty Ltd v Construction, Forestry, Maritime, Mining and Energy Union [2020] FCAFC 50 (Bianco Walling).

[36] [2003] AIRC 608 at [23].

[37] See Bradnams at [11] and Bianco Walling at [70].

[39] [2022] FWC 462.

[40] [2023] FWC 1148.

[41] [2002] AIRC 531 (PR917548) (Tenix)

[43] [2006] FCA 616 (SDA v Woolworths).

[46] United Voice v MSS Security at [19].

[49] Ibid at [77] citing Meehan v Jones [1982] HCA 52.

[50] Tenix at [32] citing Re Victorian Public Transport Enterprise Agreement 1994 (Print M2454) at [4]; Re Telstra Corporation Ltd (PR954989) at [39]-[41].

[51] [2006] FCA 11 (LHMWU v Prestige Property).

[53] See Exhibit 3 at [16]. This was consistent with how the Part 2 provision had been applied under EBA8 and EBA9.

[57] Aged Care Services Australia Group Pty Ltd v Health Services union & Australian Nursing and Midwifery Federation [2017] FWCFB 2806 at [22]- [23].

[59] Exhibit 4 at [35]-[38]; Exhibit 6 at [5]-[9]; Clauses 32.3 and 32.4 of Part 1 of EBA10.

[60] FAAA Submissions 27 January 2023, Annexure A.

[61] Exhibit 4 at [65], Annexures SR7 and SR8.

[63] Exhibit 4 at [65], Annexure SR9.

[64] Exhibit 5; Exhibit 7 and Exhibit 8.

[65] Transcript at PN244-PN247; PN256-PN257.

[66] [2022] FCA 86 at [20]- [23].

[67] [2015] FWC 7918

[68] PR958009 (CEPU v Telstra).

[69] [2017] FWCFB 3005 at [114].

[70] [2018] FCAFC 131 at [97].

[73] [2011] FWA 8288

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