//
[155]
[2018] FWC 4667
General information, not legal advice.
Fair Work Commission
2018-08-09
Mr J
Original judgment source is linked above.
s.739 - Dispute resolution
Australian Institute of Marine and Power Engineers, The
Alleged dispute about matters arising under enterprise agreement.
[1] This matter concerns a dispute about the operation of the Port Operating Procedures ("POPs") that apply at Western Port in Victoria. The POPs contain the local agreed rosters and working arrangements that apply at the Port, and are incorporated as a term of the enterprise agreement that covers the parties by clause 5.3.1 of that Agreement, being the Svitzer Australia Pty Limited National Towage Enterprise Agreement 2016 ("the Agreement").[1]
[2] The application is made by the Australian Institute of Marine and Power Engineers ("AIMPE"). It is supported by the Australian Maritime Officers' Union ("the AMOU") and the Maritime Union of Australia ("the MUA") (collectively, "the Unions"). The MUA also provided additional submissions and evidence in support of the application. The Unions claim that when the existing POPs was negotiated it was agreed that weekends would be regarded as duty-free days if the employees were provided with notice by 1 p.m. on Friday that there was no towage required to be performed on that weekend. However, if they were informed that towage was required to be performed, then both Saturday and Sunday would be considered to be duty days, regardless of whether work was required to be performed on both days.
[3] The Unions claim this outcome was viewed as a "win/win" at the time. It gave the employees more guaranteed weekends off work. It also allowed Svitzer to count those weekend days, when work was not required to be performed, toward the number of prescriptive days off it is required to provide to its employees each year.
[4] However, Svitzer submits it would never have agreed to an arrangement whereby an employee was only required to work on one day at the weekend, but both days were still considered to be duty days. It also submits that this arrangement is not suited to the current requirements at Western Port.
[5] The matter was previously dealt with in conference in December last year, and then again in January, however, a mutually agreed resolution was unable to be reached. A Recommendation was also issued following the conference in January but further discussions between the parties failed to resolve the matter. The application was accordingly set down for hearing on 24 May 2018.
[6] However, the proceedings on 24 May were then adjourned into conference while further discussions took place about how the matter should be progressed. A document containing a list of five items that would resolve the matter was put forward by the Unions, however, this outcome was not acceptable to Svitzer.
[7] The matter was accordingly relisted for hearing on 22 June 2018 and the Commission is now required to determine how the Agreement, and the incorporated POPs, should be interpreted. Mr G. Yates appeared on behalf of the AIMPE and the AMOU, together with Mr J. Moran from the AMOU. Ms S. Danalis appeared on behalf of the MUA. Mr J. Gibson with Mr P Cream appeared on behalf of Svitzer.
[8] Mr Niven is a Senior National Organiser for the AIMPE. He was involved in a series of negotiations that took place from October 2014 to renegotiate the existing Western Port POPs. A series of options were discussed in those negotiations, but the initial proposals were rejected by the employees as they involved a significant departure from the 26 week predictable leave arrangement that applied at the time.
[9] In a further meeting in March 2015 the Unions put forward a proposal based on a roster of four weeks on and four weeks off, with 12 weeks of predictable leave each year. This was eventually agreed to by Svitzer. Mr Niven concluded by stating:
"I am of the view that the wording of the 2015 PoP's captured the intention of the Parties, which is that with notice the entire Weekend would be leave and that to cover towage crew members would come in off non-predictable leave without a recall payment. The value of a recall and a weekend were comparable and the arrangement while a unique did meet the desire of the company for more flexibility and monetary savings. The problem has arisen due to the number of ships exceeding the projected number in 2016 and confusion within Svitzer Management as to the nature of the Port."[2]
[10] The Managers who were involved in these negotiations are no longer employed by Svitzer, and Mr Niven said he only became aware that Svitzer intended to apply single days at the weekend as duty days when told about this by the current Victorian Port Manager, Mr Peter Cream. He also indicated in his examination-in-chief that the Union had not made a claim in the 2015 negotiations to amend the POPs to include different recall provisions.[3]
[11] He also indicated in cross-examination that the negotiations for the POPs agreement intended to increase the number of predictable leave weeks in order to reduce the number of opportunities for people to be recalled from leave.[4] He also stated that the intention in regard to how weekends were to be treated was set out in the POPs when it stated:
"If you read down from "Working arrangements", it's "Crews rostered to duty for a 28-day period as per roster"; dot points about maintenance and all shipping to be covered. Start time stands unless deferred. "On the 1300 tape on Friday, indications for weekend towage will be advised. If no towage is indicated, crews will turn to for maintenance on Monday. Crews will ring the 1615 tape on the Sunday."[5]
[12] Mr Niven also indicated in cross-examination that the roster was still built around a 28 day roster, and within that roster there were obviously days that fell at the weekend. The only variation agreed to was that Svitzer now had the ability to advise crews on Friday, immediately prior to the weekend, that there was no requirement for towage at the weekend and they could therefore have the weekend off. A 28 day roster continued to operate, but it also provided some additional flexibility to meet the Port requirements.
[13] He also confirmed in response to a question from the Commission that once an employee is on a period of predictable leave they are not required to attend at work if asked to come in. He stated:
"In that situation you wouldn't be contacted, because you would get your instructions on the Friday at 1 o'clock that you are going to be on leave for the weekend. Those leave days become part of the predictable leave tally and therefore you wouldn't be contacted to come in. They would have gone to other crews or casual - - - "[6]
[14] He also stated in cross-examination:
"But the weekend days which is part of the roster, the 28-day roster. Within the 28-day roster there would be weekend days. The only alteration that was agreed to was that the company would advise - had the ability to advise the crews on the Friday that there was no towage over the weekend and they could have the weekend off. So there isn't - yes, that's my answer. We haven't gone from Monday to Friday situation to a 28-day roster. We have a 28 day roster which is provided some flexibility to try and meet the port requirements. We haven't worked up; we have worked out."[7]
[15] Mr Webster is a Tug Master employed by Svitzer at the Port of Western Port and has been in that role for the past 24 years. He commenced working for Svitzer when it acquired the existing business in 2007.
[16] There are two permanent three man crews at Western Port and the employees are rostered on duty for 182 days each calendar year in 28 day blocks. The roster also provides for 182 days of rostered leave.
[17] Mr Webster participated in the negotiations for the 2015 POPs, and in those negotiations Svitzer outlined how the projected shipping at the Port was anticipated to decline, and therefore weekend towage would be infrequent. It was accordingly proposed in February 2015 that the crews would be allowed to take weekends as predictable leave when no towage was required. This proposal had some attraction for the employees as it would enable them to spend more time with family at the weekends, but there were still concerns about the reduced amount of predictable leave involved. However, agreement was finally reached to provide for a lesser amount of 12 weeks of predictable leave each year in exchange for the potential ability to have more free weekends available.
[18] Mr Webster continued to state:
"The agreement reached with management at the time was that the weekends could be used as leave but only if the entire week-end was given off to enable crews to spend time away with families/friends etc. Crews would need to be advised ahead of time and it was agreed that 1300 on Friday would be an acceptable time and that if there was no towage over the weekend then crews would" call-in" at 1615hrs on the Sunday for orders turn to for work on Monday morning if no towage was to be undertaken. Single days were never discussed. The concept was premised on the basis that a weekend was equal in cost to a recall. The debate was how many times a crew could be recalled. This is why the number of predictable leave weeks was a negotiation item."[8]
[19] However, in 2016 the number of ships and towage jobs increased beyond those projected, resulting in crew members being on duty for days in excess of 182, meaning Svitzer was required to make additional penalty payments in respect of those additional days.
[20] Mr Webster said that throughout 2017 Svitzer continued to provide appropriate notice by 1300 on Fridays that the weekend was either free of duty or not. It did not stipulate on the tapes that the days were treated as single days. It was either the entire weekend free of duty, or the employees were on duty in accordance with what had been agreed to. He concluded by stating:
"The new Victorian Port Manager Peter Cream has misinterpreted the PoP's agreement by counting the weekend as single days. He has in effect gone back in time and claiming that if towage occurred on Sunday then Saturday was a day of leave. This was not the intention of the agreement and undermines the value of the leave days that crews are recalled for towage duties."[9]
[21] He also indicated in cross-examination:
"The word "recall' was used if we were called back when we were rostered off duty. That's what the recall was. No, a recall is only when you're called back in off predictable leave. That's what our term "recall" is"[10]
[22] He also stated in response to a question from the Commission:
"If you're on predictable leave we are able to come in if we say yes. They can ask us if we would come in and help on predictable leave, and we often get asked if we will come in when we are off on predictable leave. It's up to us to say yes or no."
[23] He also indicated that the call at 1.00pm on Friday simply advises whether an employee is on leave for the entire weekend, and those days then became predictable leave days, or whether they are on duty for the entire weekend, which means they are required to be within two hours' notice of the Port and are required to hold themselves ready to attend for duty, if necessary.
[24] He also indicated in his examination-in-chief that he had never been told to take one days' predictable leave at the weekend, and if he was told on the Friday tape that there was no towage required then the weekend became two days of predictable leave.
[25] It is submitted by the Unions that the essence of the dispute concerns the fact that Svitzer has not recognised duty days at weekends in accordance with the Agreement and the arrangements set out in the POPs. It also submits that it has misconceived what the dispute is about. It is not about additional claims for recall entitlements at the weekends. It is instead about whether both weekend days, when crews are not directed to take leave by means of the tapes on the preceding Friday, are deemed to be duty days regardless of towage.
[26] In its submission recall days are a totally separate entitlement and apply in totally different circumstances when an employee is recalled from predictable leave. That is not what the present dispute is about. The Unions continue to submit that the evidence makes clear the rosters are based around 28 days on/28 days off and "a weekend is a weekend. No weekend is one day."[11]
[27] The Unions also makes reference to the original dispute notification which stated:
"8. Svitzer have now sought to reinterpret the POP's document and undermine the integrity of the 28 day duty roster by treating the weekend as single days. It was always understood that in exchange for the increased flexibility of performing towage during periods of rostered leave that the weekends were either free of duty for two days or continued as part of the 28 day duty roster. Svitzer are now retrospectively treating the weekends as single days, which is contrary to the POP's document."[12]
[28] They submit that the POPs are incorporated as a term of the Agreement at clause 5.3.1, and contain the local agreed details for rosters and local working arrangements. The current dispute is based on the application and interpretation of the Westernport POPs and, in particular, the arrangements to apply at weekends.
[29] The new 2015 POPs that was negotiated provided for -
"• A roster of 28 Days of duty followed by 28 days of leave (4 weeks on, 4 weeks off)
• Agreement that weekends would be regarded as duty free days upon notice that there was no weekend towage by 1pm Friday."[13]
[30] They continue to submit that these arrangements are clearly outlined at pages 2 and 3 of the 2015 POPs agreement. Two exceptions to the 28 day on/28 day off roster were also agreed to in order to provide additional flexibility at the Port. Firstly, weekends would be free of duty upon notice that there was no towage required at the weekend and, secondly, crews would be available during their non-predictable leave to cover all Western Port towage. This coverage would be provided without the additional recall amount of 200% of the daily rate being paid for each day of recall work if crews were required to be recalled during their non-predicted leave periods.
[31] It submits these arrangements are clearly set out in the POPs when it states:
"On the 1300 tape on Friday, indications for weekend towage will be advised. If no towage is indicated, crews will turn to for maintenance on Monday. Crews will ring the 1615 tape on the Sunday.
• While rostered off crews are to be available to cover all Western Port Towage subject to the working hours, fatigue, notification and break requirements in this agreement, other than when predictable leave has been booked as per Predictable leave clause."[14]
[32] It continues to submit that the evidence of Mr Niven and Mr Webster makes clear that the intention of the new POPs agreement was that, in exchange for the reduction in predictable leave, and the willingness to perform towage duties during periods of unpredictable leave, weekends would either be free of duty for the whole weekend, or they would continue as days of duty as part of the 28 day roster if any towage was required to be performed at the weekend. The reduction in predictable leave, and being able to be recalled during unpredictable leave, was balanced against the benefits of being able to have weekends off.
[33] It continues to submit that Svitzer is now attempting to reinterpret the Agreement by treating the weekend as single days because the number of duty days in 2016 exceeded the ordinary number of 182 duty days. It points to the evidence of Mr Webster in this context when he worked on 197 days in that period, and some other crew members worked in excess of this amount. This entitles those employees to be paid a days' pay and to be credited with a days' leave for each of those days in excess of 182.
[34] It also makes reference to clause 5.3 of the Agreement, which refers to the interaction between the Agreement and the POPs. It also makes reference to clause 3.1.16 which states:
"3.1.16 Port Operating Procedures or POPs means the operating procedures applying in a particular port, which sets out details in respect of the matters referred to in clause 41.2 for that particular port."[15]
[35] It also makes reference to clause 5 .3.1 which states:
5.3.1 The POPs are incorporated as a term of this Agreement for the particular Port concerned. However, this Agreement prevails over applicable Port Operating Procedures, which have no effect to the extent of any inconsistency with any term of this Agreement."[16]
[36] It also submits that the Agreement should be interpreted in accordance with the principles established in the Full Bench decision in Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers Union (AMWU) v Berri Pty Limited ('Berri') [2017] FWC 3005 as well as the decision of Madgwick J in Kucks v CSR Limited [1996] IRCA 166; (1996) 66 IR 182. It refers, in particular, to the principles set out at paragraph 114 in Berri.
[37] It continues to submit that the words in the POPs agreement are plain words which should be accorded their plain and ordinary meaning, as stated in Berri. The construction of the POPs is clearly stated and no ambiguity exists. It continues to submit, in conclusion, that the intention of the 2015 POPs was clear, and involved a unique concept in the maritime industry. However, it also captured the intent of the parties, and worked as intended until the number of ships into Western Port exceeded projected numbers by approximately 100%. However, a further agreement was then reached about additional predictable leave weeks. This reduced the number of potential leave weeks when recalls could occur, meaning the business became even more aware of the requirement to provide notice by 1 p.m. on Friday if no towage was required at the weekends.
[38] Mr Betts is employed by Svitzer as an Integrated Rating at its towage operations at Western Port and has been employed by the business and its predecessors since 1976. He has also been a Union delegate since 1978, and was involved in the POPs negotiations in 2015 and 2016.
[39] The 2015 negotiations resulted in 12 weeks predictable leave being made available for employees on condition that they would ring the tapes at 1300 on Friday to confirm if they were to go on leave or not. Going on leave meant that Saturday and Sunday were both classed as leave days. However, in 2015 the employees rarely had weekends off because the actual volume of work meant they were required to be rostered on duty. This meant the increase in unpredictable leave that had been agreed to reduced the requirement for Svitzer to bring in relief crews, and was a major cost saving for the business.
[40] In 2016 the employees sought to negotiate additional predictable leave, and it was subsequently agreed to increase the amount to 16 weeks each year. However, in 2017 the business also proposed that single days that had not been worked at the weekend would also be treated as leave days. However, this was not what had been agreed to. It was instead agreed that if an employee was told at 1300 on Friday that they were required to be on duty then they were on duty for both days, and were required to ring the work tape on three occasions each day to confirm their work orders. They were also required to be available at all times to attend for work within two hours' notice, if necessary.
[41] Mr Betts said he had never been told on Friday to take a single day off on a weekend, and it has always been two days. In addition, the employees had never agreed to take single leave days on the weekends.[17]
[42] However, Mr Betts also acknowledged in cross-examination that the POPs did not explicitly state that if towage was performed at the weekend then the employee was considered to be on duty for the whole weekend. However, it was "a gentleman's agreement,"[18] and "an understanding between the two parties,"[19] and "we understand what it means and we abide by gentleman's agreements."[20]
[43] The MUA adopts and supports the submissions made by the AIMPE and the AMOU. It continued to indicate in its oral submissions that the evidence of Mr Betts makes clear that as a result of the negotiations for the current POPs the employees would be entitled to 12 weeks of predictable leave, and would be required to call in every Friday at 1p.m. during their rostered on weeks to confirm if they were on leave or not. If they were told they were not on leave for that weekend they would then be required to call in on Saturday and Sunday, three times each day, to confirm their work orders. During this time they had to be ready and available to attend work within two hours.[21]
[44] The understanding all along had been that the weekend was two days, being Saturday and Sunday. If employees were directed to be on leave for the weekend it meant they were free from duties for the whole weekend.
[45] It continues to submit that Svitzer has more recently sought to reinterpret the POPs so as to treat the weekend as meaning single days. However, it also acknowledged that the POPs do not specifically state that a weekend is two days, but all the evidence about what was agreed at the time makes clear this was how they were intended to apply.
[46] Svitzer submits at the outset that it was agreed in the negotiations for the existing POPs that 12 weeks of predictable leave would be provided for, and payment for a recall on Saturday would also mean payment for Sunday, representing payments of 200% on each occasion. It submits in response that this is contrary to clause 24.1.3 of the Agreement, and no documentary evidence has been provided in support of any agreement about double penalty payments applying for a weekend. Sub clause 24.1.3 is contained in the Clause headed "Salaries" and states:
"24.1.3 An employee who is recalled for a period of leave will be paid 200% of the daily salary rate for the relevant Port for each day of recall work (in addition to the employee's salary). An employee may elect to receive this payment as follows:
(ii) as one day's pay plus one day of accrued leave."[22]
[47] It continues to submit that while certain terms in the POPs are binding on the parties, they are not binding to the extent they are inconsistent with the terms of the Agreement. It also submits that the principles relied on by the Unions in Berri in regard to the interpretation of enterprise agreements should not extend to POPs.
[48] Svitzer next makes reference to Clause 5.3.1 of the Agreement which states:
5.3.1 The POPs are incorporated as a term of this Agreement for the particular Port concerned. However, this Agreement prevails over applicable Port Operating Procedures, which have no effect to the extent of any inconsistency with any term of this Agreement."[23]
[49] It continues to submit that not all of the terms in the POPs can be binding, and its content must be limited to the scope stipulated in clause 41.2 of the Agreement. Those provisions set out the limitations on the terms that can be included in the POPs. It also makes particular reference to the provisions in clause 41.2.5 which state:
"41.2.5 Employees must not work more than 14 days in excess of the number of days a full-time employee is required to work in a calendar year under the operating roster in the port (Maximum Days). For the purpose of this clause 41.2.5, the following days will be disregarded in calculating the Maximum Days:
• Work days when the employee does not perform ship-assist operations on a tugboat in any port (harbour towage);"[24]
[50] It continues to submit that while it does not deny that the negotiations in 2015 concerned the number of predictable leave days the POP's are silent on the issue in dispute, and the discussions essentially revolved around constructing a roster in the context of low volumes at the Port, and the anticipated reduction in towage jobs. It continues to submit that it would never have agreed to penalty payments being applicable for the entire two days of the weekend, in circumstances where an employee only works on one of those days. In addition, the incorporated terms in the POPs when read in their plain meaning are inconsistent with the terms in the Agreement. It also submits that the claims for additional payments represent an extra claim, which is again in breach of the terms of the Agreement.
[51] Svitzer also makes reference to the principles in Berri and agrees the wording in the POPs and the Agreement are clear, and no ambiguity exists in regard to their meaning. On the proper construction of clause 24.1.3 the relevant wording provides for daily penalty payments for employees who are recalled to work while they are on leave. However, it does not stipulate payment for a block of days, or provide for penalty payments for days not worked.
[52] It continues to submit that the Unions are instead attempting to introduce a concept whereby weekends become a block of days, and payment is required to be made for both Saturday and Sunday. It submits instead that the plain meaning should not be read in this way, and it is also inconsistent with the provisions in clause 41.2.5.
[53] Svitzer also makes reference in its submissions to the rostering challenges it faces at Western Port, being a Port with "low-volume."[25] It continued to state:
"The challenge for the organisation is how do we have the two crews providing seamless towage to our customers in Westernport without disrupting the port and ensuring that we meet the quality and safety standards in that port."[26]
[54] This application was first lodged in December last year and since that time the Commission has been involved in a series of discussions in conference in an endeavour to reach an agreed outcome. The parties have also been involved in direct discussions themselves. On 24 May the Unions provided an indication on behalf of their members about what would resolve the dispute, and this was summarised in a document prepared by the Commission. However, this outcome was not acceptable to Svitzer and the dispute was not able to be resolved. This is not intended to be a criticism of anyone involved.
[55] The Unions continue to maintain that it was never intended in the arrangements set out in the existing POPs that weekends, which fall within an employee's 28 day roster, are to be treated as single days. It was instead agreed that if they are required to work at the weekends they are on duty for both days, and if they are not required to work they are off duty on both days, and those days are then treated as part of their predictable leave days.
[56] Svitzer submits, in response, that this intention is not expressly stated in the POPs. It also submits that it would never have agreed to this arrangement because it involves employees being on duty when no towage is required to be performed. It is also not suited to the requirements at the Port of Western Port.
[57] The Commission is accordingly now required to determine how the Agreement and the Port Operating Procedures, which exist in conjunction with the Agreement, are to be interpreted.
[58] It is appropriate at the outset to set out the principles to be applied to the interpretation of an industrial instrument. This is one matter where the parties are in agreement. Both have acknowledged in their submissions that the principles enunciated by the Full Bench in Berri are to be applied in this context, and it is worthwhile to set out these principles at this point.
[59] The Full Bench in Berri commenced its review of those principles by noting, "The construction of an enterprise Agreement, like that of a statute or a contract, begins with a consideration of the ordinary meaning of the relevant words. The disputed words must be construed in the context of the agreement as a whole."[27] It continued to refer to the decision in Amcor Limited v CFMEU.[28]
[60] It also noted that, as a general principle, all of the words contained in an industrial instrument, such as an enterprise agreement, must prima facie be given some meaning and effect. It continued to note:
"Such an approach accords with the principles of statutory construction, and, as a general proposition, the principles developed in the general law in the context of the interpretation of statutes are applicable to the interpretation of enterprise agreements."[29]
"There is a long line of authority in support of the proposition that a 'narrow or pedantic' approach to the interpretation of industrial instruments (such as enterprise agreements) is to be avoided, and that 'fractured and illogical prose may be met by a generous and liberal approach to construction."[30]
"A consequence of such an approach may be that some principles of statutory construction have less force in the context of construing an enterprise agreement."[31]
[63] In this context it referred to the decision in Shop, Distributive and Allied Employees' Association v Woolworths Limited,[32] which observed that the processes of bargaining and agreement making can mean that consistency of wording is often absent, and the same words can be used in different provisions with different meanings.
[64] The Full Bench in Berri finally decided to confirm the principles to be applied to the interpretation of an enterprise agreement. It accordingly concluded:
"[114] The principles relevant to the task of construing a single enterprise agreement may be summarised 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:
(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.
2. 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.
3. 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.
4. 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.
5. 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.
6. 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.
7. 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.
8. Regard may be had to evidence of surrounding circumstances to assist in determining whether an ambiguity exists.
9. If the agreement has a plain meaning, evidence of the surrounding circumstances will not be admitted to contradict the plain language of the agreement.
10. 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.
11. 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 and 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.
12. 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.
13. 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.
14. 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.
15. 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."[33]
[65] I turn now to consider the relevant provisions in the Agreement and the incorporated POPs based on the principles in Berri. The first requirement is obviously to determine whether the relevant terms, and their place in the overall structure of the Agreement, can be said to have a plain and ordinary meaning and are to be applied in that way, or whether they evidence ambiguity or are susceptible of more than one meaning.
[66] Clause 3 of the Agreement "Definitions and Interpretation" contains a definition of the Port Operating Procedures at 3.1.16. It states:
"3.1.16 Port Operating Procedures or POPs means the operating procedures applying in a particular port, which sets out details in respect of the matters referred to in clause 41.2 for that particular port."[34]
[67] Clause 5 is headed "Operation and Relationship with other industrial instruments," and states at 5.3 "Interaction with POP's":
5.3.1 The POPs are incorporated as a term of this Agreement for the particular Port concerned. However, this Agreement prevails over applicable Port Operating Procedures, which have no effect to the extent of any inconsistency with any term of this Agreement."[35]
[68] Clause 41 of the Agreement then deals at length with the Port Operating Procedures that are intended to be in place at each Port, and what those procedures are intended to encompass. It states in full:
41.1 There will be a set of Port Operating Procedures in each port. Port Operating Procedures must be reviewed at least annually. Svitzer will prepare and distribute to the Unions a report on the status of the Port Operating Procedures by 31 March. Subject to clause 41.4, the annual review must be completed by 30 April. Following the review Svitzer will prepare another status report by 14 May.
41.2 The Port Operating Procedures (when made or varied) will set out details in respect of the following subject matter, which provide a foundation for the guidance to the parties in developing Port Operating Procedures:
(i) Towage operations are carried out over 24 hours per day on every day of the year;
(ii) rosters will as far as practicable include the detail of work days, the component of predictable leave days, and the number of crews on duty and on leave required to man the roster;
(iii) Off-duty periods for permanent full-time employees:
(iv) Off-duty periods for permanent part-time employees:
Permanent full-time employees are the main source of crewing the port roster and permanent part-time employees supplement the roster. Where a port cannot support a roster for permanent part-time employees, off-duty periods will be programmed as follows:
Permanent part-time employees must otherwise be available for relief work duty in accordance with clause 41.2.7(i)A.
(i) should include details of the procedures to be used for the giving, receipt and acknowledgement of work orders;
(ii) SMS messages may be used to communicate orders for the purpose of minimising off-duty disruption to employees;
(iii) Employees should not be contacted unnecessarily during breaks.
The objective of any duty roster is to ensure that sufficient employees are available at any time to satisfy customers' requirements on no more than 2 hours notice, unless the Port Operating Procedures specify otherwise to meet those requirements.
41.2.4 Hours of work, regular duty requirements and off-duty periods
(i) Scheduled hours of work should not exceed 12 hours. That is:
The parameters for scheduling the last job in the period must be set out in the Port Operating Procedures.
(ii) If an employee is required to be on continuous duty for 14 hours or more, the employee must be given a rest break of 10 hours at the cessation of that period of duty before the commencement of the next period of duty.
(iii) A period of continuous duty must not exceed 16 hours.
(iv) A nominated rest break of 6 hours or more breaks the continuity of a period of duty.
(v) Employees will be entitled to a meal break on completion of 5 hours' duty. Meal breaks must be taken flexibly. For the avoidance of doubt meal breaks must not be taken in a manner or at a time that would interrupt port operations.
41.2.5 Employees must not work more than 14 days in excess of the number of days a full-time employee is required to work in a calendar year under the operating roster in the port (Maximum Days). For the purpose of this clause 41.2.5, the following days will be disregarded in calculating the Maximum Days:
41.2.6 The parties will keep fatigue management and the operation of the roster under review in each port, through the local Work Health and Safety committee, so as to ensure the proper and efficient management of fatigue. Because of the unpredictability of vessel movements the strict application of the STCW Code as above may not always be possible, however, an employee must be provided with minimum aggregate rest of 77 hours in 7 days consistently with Marine Orders Part 28, section 4.
41.2.7 Relief arrangements to be utilised in the Port and casual usage.
(i) Relief work requirements to supplement the roster will usually be covered:
(ii) Permanent full-time employees on rostered leave are not obliged to be available for relief work, however subject to clause 41.2.5, every employee and the Unions will ensure that, under normal circumstances as described in the Port Operating Procedures, the port operations are not compromised by unavailability of relief personnel to cover short term or unplanned absences.
The incidence of relief days, measured over a representative period (say 6 months), shall be reviewed in conjunction with the annual review of the Port Operating Procedures.
41.2.8 Other issues of an operational nature, specific to the Port.
Port Operating Procedures should not prevent or unreasonably restrict Svitzer's ability to meet customer and port requirements on Saturdays, Sundays or Public Holidays.
41.3 Port Operating Procedures must be signed by the Port Manager and authorised union representatives.
41.4 Changes to Port Operating Procedures may be made by agreement following consultation, or as follows:
(i) Where Svitzer is proposing the change it will notify the Union in writing of the proposed changes and where the Union is proposing the change it will likewise notify Svitzer in writing;
(ii) The parties will commence consultation at a local level about the matters set out above within seven days of such notification.
(iii) Consultation at local level will continue with a view to reaching consensus about the changes, and then at national level if the matter cannot be resolved locally.
(iv) In the event that the parties cannot achieve a consensus within a reasonable timeframe, the party proposing the change may give 28 days notice requiring that the change be implemented.
(v) During the notice period, either party may make application in accordance with the Dispute Resolution Procedure and if such application is made, the status quo will remain until the matter is settled.
41.5 A copy of this Agreement and the Port Operating Procedures will be kept in a convenient location at the Port.
41.6 During the term of this Agreement, the Company and the Unions will meet to develop a Port Operating Procedures template."[36]
[69] Clause 42 of the Agreement continues to set out the provisions in regard to "Leave," which also have some relevance in the context of the this dispute. It states:
42.1 This clause operates in conjunction with the NES. The provisions of this clause are intended to satisfy the provisions in the NES concerning maximum weekly hours of work, annual leave and public holidays.
42.2 The roster that prevails in the port under the applicable Port Operating Procedures will provide for the number of days free of duty set out in clause 42.3 averaged over the applicable roster cycle.
42.3.1 A permanent full-time Employee will be entitled to 182 days free of duty in each year (which may be averaged over the applicable roster cycle), or to proportionate leave for any continuous service of less than a year.
42.3.2 A permanent part-time Employee will be entitled to the leave granted to a full-time Employee on a pro-rata basis. (For example, an employee who is engaged in a 50% permanent part-time role will be entitled to 91 days free of duty in each year of continuous service.)
42.3.3 An Employee who is engaged for a specified period of time or a specified task, will be entitled pro-rata, to the leave granted to a full-time Employee based on the period of the respective engagement.
42.4 The leave prescribed in this clause 42 includes the following entitlements of full-time employees (who may otherwise have been engaged on a Monday to Friday basis in accordance with the terms of the Award):
(ii) 5 weeks of paid annual leave for shiftworkers;
(iv) an additional 28 days leave in recognition of the 35-hour week.
42.5 For each day of absence referred to in clause 38, an employee's leave entitlement under this clause 42 will be debited by one day."[37]
[70] The Port Operating Procedures at Western Port are then set out in a separate document. The parties agreed that the relevant version of the document in the context of these proceedings is the POPs dated 15 November 2016. It is entitled:
[71] The relevant extracts from the document are set out below, beginning with the opening paragraphs:
"These Port Operating Procedures have been developed pursuant to the Svitzer Australia PTY Limited National Towage Enterprise Agreement 2016. The EA's set out the subject matter of the Port Operating Procedures. The procedures apply to the Tugboat employees in the Victorian Port of Western Port.
These procedures will be reviewed by April 30 2017 or as necessary.
These Procedures will not operate inconsistently with the principles in clause 41.2.4 of the EAs.
This document describes the locally agreed procedures in relation to:
• Predictable Leave."[39]
[72] It then continues to state under the heading "Western Port Duty & Non-Duty W1 & W2":
• The Western Port roster will allocate one duty crew to W1 and one non Duty crew to W2."[40]
[73] The next extract from the POPs is relied on by the Unions, as indicated by the evidence of Mr Niven, in support of their submissions about how the arrangements are to be interpreted. They are set out under the heading "Working Arrangements," and the following relevant extracts state as follows:
• On the 1300 tape on Friday, indications for weekend towage will be advised. If no towage is indicated, crews will turn to for maintenance on Monday. Crews will ring the 1615 tape on the Sunday."[41]
[74] The document then continues to indicate in regard to the crew that is rostered off:
"While rostered off crews are to be available to cover all Western Port Towage subject to the working hours, fatigue, notification and break requirements in this agreement, other than when predictable leave has been booked as per Predictable leave clause."[42]
[75] The concluding paragraph of the POPs document also indicates, in part, under the heading "Predictable Leave":
• "12 weeks (84 days p.a.) of predictable leave per year may be booked during rostered off periods (each year starts as of 01 Jan)."[43]
[76] Svitzer submits at the outset that the interpretation placed on the POPs by the Unions is in breach of the terms in the Agreement, and must be rejected because of the effect of clause 5 of the Agreement, which states at sub clause 5.3 that the "Agreement prevails over applicable POPs, which have no effect to the extent of any inconsistency with any term of this Agreement."[44] It relies, in particular, on the terms contained in sub clause 24.1.3 of the Agreement, which have been set out at an earlier point in this decision and are not restated now.
[77] The Unions reject this submission and claim that Svitzer has misconceived what the dispute is about when suggesting that it concerns additional claims for recall entitlements at the weekends. In their submission it is instead about whether all weekend days, when crews are not directed to take leave by means of the tapes on the preceding Friday, are deemed to both be duty days regardless of towage and, vice versa, when crews are directed to take leave by means of the tapes both days are deemed to be leave days.
[78] I am also satisfied that it is not appropriate to categorise the dispute as being one about additional claims for recall entitlements. Therefore, Svitzer's submission that the application should be dismissed because the entitlement claimed is inconsistent with the Agreement is rejected. The dispute is instead encompassed by matters that clause 41.2 intends to be the subject of POPs, as referred to more specifically in sub clause 41.2.1 "Port Rosters." For example, it refers to "rosters will as far as practicable include the detail of work days, the component of predictable leave days, and the number of crews on duty and on leave required to man the roster".[45] It also makes reference to the POPs dealing with "Off-duty periods for permanent full-time employees," and continues to indicate that "leave for permanent full-time employees should to the greatest practical extent to be predictable".[46] It also makes reference to the means of communicating work orders, and to dealing with "Availability" in order "to satisfy customers' requirements on no more than 2 hours notice, unless the Port Operating Procedures specify otherwise to meet those requirements."[47]
[79] It also states at 41.2.8 in regard to "Other issues of an operational nature, specific to the Port," that "Port Operating Procedures should not prevent or unreasonably restrict Svitzer's ability to meet customer and port requirements on Saturdays, Sundays or public holidays."[48]
[80] I am accordingly satisfied that the subject matter of the dispute, which concerns rosters, duty at the weekends, and predictable leave entitlements, does concern matters that clause 41 intends to be the subject of localised POPs at an individual Port. In addition, I am not satisfied that the way in which the Unions' claim the POPs at Western Port are to be interpreted is inconsistent with the Agreement.
[81] It follows that the Commission is now required to determine whether the POPs at Western Port should be interpreted and applied in the way the Unions' now contend, or whether some other interpretation is to be preferred.
[82] As indicated, the Unions' rely on the following wording in the POPs, in particular, in support of how it is intended to be interpreted and applied. These extracts are set out under the heading "Working Arrangements" and Western Port - Duty Crew W 1 and relevantly state:
"• Crew rostered to duty for a 28 day period as per roster.
• On the 1300 tape on Friday, indications for weekend towage will be advised. If no towage is indicated, crews will turn to for maintenance on Monday. Crews will ring the 1615 tape on the Sunday." [49]
[83] These provisions, firstly, make clear that the rosters are to be based around a roster involving 28 days on duty, followed by 28 days off duty. The second point makes clear that the requirement for weekend work during the 28 day on duty roster period will be made clear by each employee contacting "the 1300 tape on Friday" to confirm whether weekend towage is required, given maintenance work is not required to be performed at the weekend, as the Agreement makes clear.
[84] It is also clear that if the tape indicates that no towage is required at the weekend then the employee is not required for duty at the weekend, and they are then required to ring the tape again at 1615 on Sunday to ascertain what will be required on the following day as in either towage or maintenance.
[85] However, it is also clear, as Svitzer submits, that the wording in the POPs is not explicit in terms of making clear what is to occur if an employee is required to attend for duty on only one, but not both of the weekend days. It is also not clear in terms of how the days are to be treated when an employee is not required to attend for duty at the weekend. For example, are they to be treated as predictable leave days, and counted towards the amount of predictable leave to be required to be provided to employees during a calendar year, or are they to be treated as non-predictable leave days?
[86] The Unions submit that when the POPs was negotiated it was understood that if an employee was required by the Friday tape to be on duty for the weekend then they are considered to be on duty for both of those weekend days, regardless of what work was required to be performed. However, if the tape did not require them to be on duty then both of those weekend days are treated as predictable leave days, and count toward the total amount of predictable leave required to be provided to the employees in that calendar year. However, as Svitzer quite rightly points out this is not specifically stated in the actual wording in the POPs.
[87] It follows that the words do not have a plain and ordinary meaning, and are instead ambiguous or susceptible of more than one meaning. The Commission is therefore required to have regard to the relevant principles in Berri to determine how the POPs should now be interpreted. Those principles relevantly make clear at the outset that the Commission is not to be involved in rewriting the terms of an Agreement or other industrial instrument to achieve what might be regarded as a fair or just outcome. The task is instead to interpret the Agreement produced by the parties. That common intention is also to be identified objectively, based on what a reasonable person would understand by the language used. An overly technical approach to interpretation is also to be avoided.
[88] As indicated already I am satisfied that the relevant words can be said to be ambiguous or susceptible of more than one meaning. The principles in Berri make clear in this context that evidence of the surrounding circumstances can be admissible to aid interpretation. However, the admissibility of such evidence is limited to that tending to establish objective background facts which were known to both parties, and is to be distinguished from evidence about the subjective intentions of the parties. The principles in Berri continue to indicate that evidence of objective background facts will include evidence of prior negotiations to the extent that they tend to establish objective background facts known to the parties, as well as notorious facts of which knowledge is to be presumed. Regard can also be had to evidence of matters in common contemplation and constituting a common assumption.
[89] I am satisfied, in response, that the evidence of Mr Niven, Mr Webster and Mr Betts can be considered in this context. Each was involved in the negotiations that led to the establishment of the existing Port Operations Procedures at Western Port. Their evidence is consistent, and I am satisfied that it tends to establish objective background facts which were known to both parties at the time of the negotiations.
[90] For example, the evidence of Mr Webster indicates that at the time the negotiations for the current POPs were taking place Svitzer was of the view that the projected volume of shipping at Western Port was to decline, and weekend towage would be infrequent. Various options were considered in this context until a proposal was developed by the Unions and finally accepted by all parties.
[91] It enabled the crew on duty as part of their 28 day roster to take the weekends as predictable leave when no towage was required. This had significant attraction for the employees as it created the potential for them to spend more time with family at the weekends, and it was accepted by them despite their concerns about the reduced amount of predictable leave involved. The outcome finally agreed upon involved the reduced amount of 12 weeks of predictable leave each year balanced by the potential to have additional duty free weekends during the roster.
[92] The associated benefit for Svitzer derived from the fact that, when an employee was told on the Friday tapes that that they were not required for duty on the weekend, then those days became part of the predictable leave tally and could be deducted from the amount of predictable leave Svitzer was required to provide to employees each calendar year.
[93] It was also made clear in the evidence of Mr Niven, Mr Webster and Mr Betts that single days were never discussed in these negotiations, and this arrangement would not have been acceptable to the employees if this had of been the case as it would have removed the potential benefit of having additional free weekends.
[94] Mr Webster's evidence also made clear that this is how the arrangement was applied in practice, and throughout 2016 and 2017 Svitzer continued to provide appropriate notice by 1300 on Fridays that the weekend was either free of duty or not for the crew rostered on at that time. It was never stipulated on the tapes that the days were to be treated as a single days, and it is only in more recent times that Svitzer has sought to suggest that this is not how the POPs is intended to be interpreted and applied.
[95] It is also noted that Svitzer did not call any evidence to refute the suggestion that the evidence referred to above established objective background facts which were generally known to both parties.
[96] I am satisfied, in conclusion, that the existing POPs at Western Port are to be interpreted and applied as the Unions contend, and accordingly all weekend days when crew are advised on the Friday tape to take leave and turn to Monday are to be deemed as leave days. Those days are also considered to be predictable leave days. Conversely, all weekend days when crew are not directed to take leave on the Friday 1300 tape are to be deemed as duty days, regardless of towage.
[97] It is acknowledged that Svitzer submits that these arrangements are not suited to the current operations at Western Port. I make no comment about that submission other than to say that it is not a matter that the Commission is required to have regard to at this time. Its task was instead to interpret the terms and conditions contained in the Agreement that covers the parties, together with those contained in the POPs that currently have application at Western Port.
[98] The Agreement and the POPs obviously provide for regular reviews of the POPs and that is the way that changes in the Port operating requirements are to be addressed. This is not to suggest that it is necessarily an easy task to arrive at outcomes in these negotiations that satisfy the requirements of all involved.
[99] However, I am satisfied that this was the outcome that was arrived at in the negotiations took place in 2015 and for the reasons indicated I am satisfied that the existing Port Operating Procedures at Western Port are to be applied and interpreted in the way that the Unions' contend.
G Yates for the Australian Institute of Marine and Power Engineers and the Australian Maritime Officers' Union.
J Moran for the Australian Maritime Officers' Union.
A Jacka, S Danalis and P Betts for the Maritime Union of Australia.
J Gibson and P Cream for Svitzer Australia Pty Ltd.
[12] Form F10 Application, filed 20 November 2017, q 2.1.
[14] Ibid, Attachment "Union 1", p 2-3.
[15] Svitzer Australia Pty Limited National Towage Enterprise Agreement 2016, cl 3.1.16.
[22] Svitzer Australia Pty Limited National Towage Enterprise Agreement 2016, cl 24.1.3.
[24] Svitzer Australia Pty Limited National Towage Enterprise Agreement 2016, cl 41.2.5.
[27] "Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU) v Berri Pty Limited [2017] FWCFB 3005, [41].
[34] Svitzer Australia Pty Limited National Towage Enterprise Agreement 2016, cl 3.1.16.
[36] Svitzer Australia Pty Limited National Towage Enterprise Agreement 2016, cl 41.
[38] Exhibit S1, Attachment "Port Operating Procedures for Western Port Start date 15/11/2016", p 1.
[44] Svitzer Australia Pty Limited National Towage Enterprise Agreement 2016, cl 5.3.1.
[49] Exhibit S1, Attachment "Port Operating Procedures for Western Port Start date 15/11/2016", p 3.
Printed by authority of the Commonwealth Government Printer
Australian Institute of Marine and Power Engineers, The
Svitzer Australia Pty Ltd [2018] FWC 4667
(1996) 66 IR 182
(2005) 222 CLR 241