s.739 - Dispute resolution

One Rail Australia (FLACH) Pty Ltd T/A One Rail Australia

Alleged dispute about matters arising under the the One Rail Australia (FLACH) Pty Ltd, NSW Coal Haulage Enterprise Agreement 2023 - accrual and payment of days in lieu (DILs) which have been accrued in substitution for public holiday payments - whether DILs can be taken as single days or in blocks (the latter unattached to periods of annual leave) - meaning of the term "single day/s"

• [1] An application has been made by the Australian Rail Tram and Bus Industry Union (RTBU/Applicant) for the Commission to resolve a dispute[1] with One Rail Australia (FLACH) Pty Ltd T/A One Rail Australia (One Rail/Respondent) under the One Rail Australia (FLACH) Pty Ltd, NSW Coal Haulage Enterprise Agreement 2023 (Agreement).[2]

• [2] The Agreement applies to One Rail and its employees (who are employed in one of the classifications contained in the Agreement). The RTBU is covered by the Agreement.

• [3] Conciliation was unsuccessful in resolving the dispute. There is no contest between the parties as to the jurisdiction of the Commission to resolve this dispute by way of arbitration in accordance with clause 72.6.1 of the Agreement,[3] and s.739 of the Fair Work Act 2009 (Act). I equally make this finding.

• [4] Directions were issued for the filing and serving of submissions and evidence, and a hearing was conducted in Sydney. At the hearing, Mr Peter Matthews, RTBU Legal Officer, appeared for the Applicant, and Ms Catherine Bemcrick, of Counsel, instructed by Mr Stephen Price, Partner, and Ms Lucy Morris, Senior Associate, Corrs Chambers Westgarth lawyers, appeared (with permission) for One Rail.

• [5] Clause 62.3 of the Agreement provides that employees (at their election) are (either) paid 7.6 hours for a public holiday, or, accrue (bank) a day in lieu (DIL), to be taken at a later time.

• [6] An employee may bank up to 11 or more DILs each year (i.e. based upon the number of public holidays prescribed in the Agreement, and otherwise additionally proclaimed).

• [7] All DILs banked or accrued must be taken (cleared), or have been arranged to be taken (cleared), by the anniversary date of the Agreement each year (2 August). Otherwise, outstanding DILs are paid out to the employee (in next pay cycle) and cancelled (i.e. as a form of available leave). The anniversary date cut-off for DILs (to be paid out and cancelled) may be extended by mutual agreement between the Respondent and an individual employee.[4] An employee request to clear their DILs by taking them as leave is not to be unreasonably refused by the Respondent.

• [8] Clause 62.3 of the Agreement sets out what an employee becomes entitled to in respect of a public holiday under different roster scenarios. It reads:

62.3 The table below sets out payments for Public Holidays:

Is available to be rostered to work but is given the day off i.e. Transition Day[6]

Penalty of 1.5 and credit equal to the number of hours worked for all hours worked on the Public Holiday, plus:

Works any Overtime shift (including a Book Off Day)

Penalty of 1.7 for all hours worked on the shift and:

• An additional payment of 7.6 hours for the Public Holiday; or,
• the option to bank a DIL.

Has been rostered but job is cancelled on the day and no further work is available

• An additional payment of 7.6 hours for the Public Holiday; or,
• the option to bank a DIL.

• [9] Clause 62.6 of the Agreement concerns the taking and payout of DILs, it reads:

"62.6 Days off (DIL) in lieu can be accumulated or banked as per the above table [clause 62.3] for taking at a later date either as single day/s or with annual leave. Where an employee wishes to attach their days in lieu (DIL) to their annual leave they must advise the company in a reasonable time frame prior to the commencement date of such leave."[8]

(a) the payment for a DIL when it is taken as leave (i.e. 7.6 hours, or the hours the employee would have worked had they been at work on that day/shift); and

(b) the ability of employees to take DILs as either single days, or multiple consecutive days (unattached to annual leave).

• [11] The agreed questions to be answered in this arbitration are:

1. What does "day" mean in the context of an employee's entitlement to a day in lieu (DIL) under clause 62 of the One Rail Australia (FLACH) Pty Ltd, NSW Coal Haulage Enterprise Agreement 2023 (the Agreement)?

1. How do DILs accrue, and at what rate do they accrue?

1. Is One Rail's practice, which is to deduct 7.6 hours from an employee's accumulated DIL bank for each DIL taken, the correct practice?

1. If the answer to question 1(b) is "No", what is the correct treatment when deducting a DIL from an employee's accumulated DIL bank?

2. What is the correct interpretation of "single day/s" in clause 62.6 of the Agreement?

1. Does the reference to "single day/s" mean that One Rail's employees are only entitled to take a DIL as a single, non-consecutive day, unless attached to a period of annual leave?

1. If the answer to question 2(a) is "No", does the reference to "single day/s" confer an entitlement for One Rail's employees to take DILs as multiple, consecutive days, even when not attached to a period of annual leave?[9]

• [12] My determination in this matter applies the principles set out in Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers Union v Berri Pty Ltd[10] and James Cook University v Ridd.[11] Such principles were neatly and helpfully summarised by Deputy President Gostencnik (as he then was) in Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers' Union v Paper Australia Pty Ltd:[12]

"In short compass, much like the approach to construing a statute, the construction of a provision in an enterprise agreement begins with a consideration of the ordinary meaning of the words used, having regard to the context and evident purpose of the provision or expression being construed. Context may be found in the provisions of the agreement taken as a whole, or in their arrangement and place in the agreement being considered. The statutory framework under which the agreement is made may also provide context, as might an antecedent instrument or instruments from which a particular provision or provisions might have been derived. The industrial context in making an enterprise agreement and in which it operates is also relevant."[13]

• [13] The legislative provisions of the Act provide relevant context to the interpretation of enterprise agreements.

• [14] For an enterprise agreement to be approved, amongst other requirements, the terms and conditions contained in the enterprise agreement must leave an employee to whom it applies better off overall when compared to the modern award (safety net) that the employee is covered by. The better off overall test (BOOT) is not a line by line analysis, but a global assessment.

• [15] The National Employment Standards (NES) have effect subject to the terms included in an enterprise agreement, provided such enterprise agreement terms are not detrimental to an employee in any respect when compared to the NES. A term will not be detrimental to the NES minimum if it:

(a) has the same (or substantially the same) effect as the NES entitlement in question; or

(b) supplements the NES entitlement, including to provide a greater benefit.

• [16] The Agreement (including its terms) apply to the total exclusion of the Rail Industry Award 2020 (Award). The Award provides that public holiday entitlements are as per the NES.[14] An employee who works on a public holiday under the Award is paid 250% of the employee's ordinary hourly rate of pay for any hours (ordinary and overtime) worked on a public holiday.[15] The Award does not provide for the substitution of public holidays, by agreement or otherwise.

• [17] There is no dispute between the parties that employees will remain better off overall (in respect of public holidays) under the Agreement, than they would be under the Award, whether the RTBU's, or One Rail's, interpretation of clause 62.6 applies.

• [18] Finally, nothing in this dispute turns upon an interpretation arising from an inconsistency with the NES (that needs to be corrected or set straight). Relevantly, by way of outline, the NES provides that:

(a) An award or enterprise agreement may include terms for the averaging of hours of work (including maximum average hours and reasonable additional hours) over a specified period (i.e. across a roster cycle/s, averaged over a specified period of up to one year). An employee's ordinary hours of work (to whom an award or enterprise agreement applies) are determined by reference to the ordinary hours of work terms set out in the applicable award or enterprise agreement (s.63 of the Act).

(b) Employees are entitled to be absent from work on a public holiday (subject to an employer request to work that is reasonable), with such absence to be paid at the employee's base rate of pay for the employee's ordinary hours of work on the day in question (even though the employee does not work that day). The NES does not provide for a penalty rate payment when a public holiday is worked. There is no suggestion in this dispute that clause 62 of the Agreement is other than consistent with (or reflective of) the NES minimum requirements. Section 115(3) of the Act provides that an enterprise agreement may include terms (being supplementary or additional terms, that extend beyond the NES minimum) providing for an employer and employee to agree upon the substitution of a public holiday for another day (that is not a public holiday). In this case, the supplementary term (clause 62.6) is not an NES term, i.e. clause 62.6 of the Agreement is a term in addition to the NES minimum, it is not in and of itself an NES term.

• [19] A full time employee under the Agreement is engaged to work 1976 ordinary hours per year (clause 6 (Definitions) and clause 8.2.1 of the Agreement). Ordinary hours can be worked on any day at any time, and include (or are made up of) ordinary hours worked, public holidays, and any approved leave (as described in the Agreement) (clause 34). The Agreement contains two ordinary hours master rosters, being Roster A (76 ordinary hours rostered over a two week roster cycle), and Roster B (304 ordinary hours rostered over an 8 week roster cycle - being 28 even time shifts of 10.85 hours per shift over an eight week period, 7 working shifts per fortnight, and 7 days off per fortnight (including book days and transition days)).[16] It is not in dispute that the majority of employees to whom the Agreement applies work as Train Crew Drivers pursuant to Roster B.[17]

• [20] Employees are paid on an "annual remuneration" basis, via equal pay instalment amounts over a fortnightly (14 day) pay cycle (clauses 28.1 and 42.2). Such remuneration is inclusive of all shift loadings, annual leave loading, weekend penalties, and other penalties and allowances, but excluding expense and transfer allowances, and overtime (clause 28.5.1). The short point is that an employee is not paid under the Agreement by reference to the number of hours the employee works, but pursuant to an annual salary (paid fortnightly) based upon the set number of ordinary hours that are prescribed in a roster. As Mr Cribb states: "[Under the Agreement] Employees are also guaranteed to be paid for 76 ordinary hours each fortnight, even if they are scheduled to work less than that across the fortnight."[18] I observe that the effect of these payment arrangements points to the RTBU's concerns around the number of hours to be deducted for a DIL (that is taken as leave) being very much academic.

• [21] A DIL is defined in the Agreement as a "Day Off In Lieu", whilst a "Day" is defined as "For the purposes of paid leave, a day means 7.6 hours".[19] Clause 62 (Public Holidays) sits within Part 7 of the Agreement, titled "Leave".

• [22] Clause 62.3 of the Agreement refers to "all hours worked" and "minimum shift length" only in respect of public holiday penalty payments. The additional election to be made between a payment of 7.6 hours, or the banking of a DIL, has no 'express' connection (on the words of clause 62.3) with hours worked or shift length (i.e. the 7.6 hour payment, or the banking of a DIL, is in addition to ("and" or "plus") any penalty rate payment).

• [23] Public holidays fall upon individually named days each year in the annual calendar. Simply because some public holidays may fall consecutively does not change the fact that they are an individual occurrence. The entitlements under clause 62.3 of the Agreement only arise (or fall due) when the named individual public holiday occurs.[20] If an employee wants to take consecutive public holidays, such public holidays need to be taken as leave at the time such public holidays occur. Where such public holidays are banked, they are banked individually (i.e. no matter how or in what sequence such public holidays may have fallen in the annual calendar). To assert otherwise makes absolutely no sense, by reference to the NES, the terms of the Agreement, and/or State public holiday proclamation legislation.

• [24] The Agreement replaced an earlier enterprise agreement with the same scope and coverage, being the Freightliner Australia Coal Haulage Pty Ltd Enterprise Agreement 2019 (2019 Agreement). The 2019 Agreement was, like the Agreement, negotiated by the RTBU and One Rail (the latter was then known as Freightliner). The 2019 Agreement covers the RTBU, and commenced operation on 7 May 2019. It applied until it was replaced on 8 August 2023 by the Agreement (which has a nominal expiry date of 2 August 2027).

• [25] The terms DIL and Day are defined exactly the same in both the 2019 Agreement, and the Agreement (i.e. a DIL is defined as "Day Off In Lieu", and a "Day" is defined as "For the purposes of paid leave, a day means 7.6 hours").[21] There is no evidence that these defined terms were ever discussed during bargaining negotiations prior to the making of the Agreement (i.e. no claim was logged (or made) by either party (prior to or during bargaining) to change the way that DILs were taken as leave after their accrual).[22]

• [26] Clause 62.6 of the Agreement was amended from clause 49.2 of the 2019 Agreement. The comparison in this regard is as follows:

Where an Employee has accrued a DIL in accordance with sub-clause 49.4, the Employee has until 31st October to take such days off, or to attach to a period of Annual Leave. If the Employee has not taken the days off prior to this date, the Employee will be paid for all such DIL in the next pay period on or after 15th November and the DIL will be cancelled.

Days off (DIL) in lieu can be accumulated or banked as per the above table [clause 62.3] for taking at a later date either as single day/s or with annual leave. Where an employee wishes to attach their days in lieu (DIL) to their annual leave they must advise the company in a reasonable time frame prior to the commencement date of such leave.

(a) clause 49.2 of the 2019 Agreement provides that accrued or banked DILs must be 'taken' before 31 October each year, or attached to a period of (future) annual leave before 31 October each year, or such DILs will be paid out to the employee in the November payroll; and

(b) clause 62.6 of the Agreement is not in the same terms as clause 49.2 of the 2019 Agreement. Cluse 62.6 provides that accrued or banked DILs can be taken at a later date as single day/s, or with annual leave. Read with clause 62.7 and 62.8, a yearly anniversary date applies to the time by which a DIL is taken, unless otherwise mutually agreed. Clause 62.9 provides that an employee's request to clear (take) their DILs shall not be unreasonably refused by One Rail. Situations in which it may be 'reasonable' for One Rail to refuse an employee request to clear their DILs encompass (for example):

1. the time that a DIL clearance request is made by an employee (e.g. short notice, or an absence of reasonable notice provided by the employee to One Rail, or the request being made close to the anniversary date);

1. the DIL clearance request being made such that it pushes the taking of the DIL past the anniversary date of the Agreement (thus resulting in the DIL being paid at a higher rate of pay when it is taken because of annual wage increases);

1. operational requirements or priorities (including priorities that might arise from time to time);

1. the number of other employees on leave at the same time;

1. the availability of other employees to fill leave absences; and

1. depending upon the particular circumstances from time to time, any other relevant matters.

• [28] Upon the commencement of the Agreement (9 August 2023), previously accrued DILs were disposed of (paid or cleared) pursuant to clause 62.5 of the Agreement. In the 12 months that followed, employees (who made an election) accrued further DILs.

• [29] It appears that various employees failed to take their DILs throughout the year, and started to make requests of the Respondent to fast-track the clearance of their DIL accruals by taking them as leave in blocks (i.e. consecutive days) unattached to annual leave (i.e. prior to the next anniversary date (2 August 2024)), or at least have such clearances approved before the anniversary date (clause 62.7 of the Agreement).

• [30] On 2 August 2024 (Agreement anniversary date), the RTBU raised with the Respondent its concern that the Respondent was refusing requests for employees to take their DILs in blocks (i.e. the taking of more than one DIL together or consecutively, unattached to a period of annual leave).[23]

• [31] The Respondent's position was that a DIL could only be taken on a single day or on single (separate and non-consecutive) days, unless attached to annual leave, in which case more than one DIL can be taken consecutively. In other words, the principle that DILs and annual leave were there to be taken as leave, and not grown into employee nest eggs (via accruals that automatically increased annually with wage rate increases), was not only to be applied, but taken on as an issue to be directly managed by the Respondent from an operational and good governance perspective (in accordance with the terms of the Agreement).[24] This is especially so in circumstances where numerous employees seek to push through a late rush of requests to have their DIL clearances approved, including to take such DILs after the Agreement anniversary date, because the employees have not previously organised themselves (for whatever reason) to take their DILs prior to the anniversary date.[25]

• [32] The RTBU disagreed with the Respondent's position and approach, and was of the view that DILs can be taken in a block of days (i.e. multiple consecutive days), regardless of whether or not such DIL blocks are, or are not, attached to a period of annual leave.[26]

• [33] During bargaining, in the lead up to the making of the Agreement, a claim was made by the RTBU for "improvement to Public Holidays",[27] whilst One Rail sought the "Removal of Public Holiday Day Off In Lieu Bank".[28] At the time (between November 2022 and June 2023), employees had significant DIL leave balances (having not sought to take such DILs during the calendar year they had accumulated), and were pressing for One Rail to approve DILs being taken in blocks (as opposed to utilising their annual leave accruals). One Rail's position was that (now or into the future) it did not want either:

(a) DIL accruals to be automatically carried over into following years, giving rise to excessive DIL accruals and excessive DIL payroll liability (that increased with annual wage rises); or

(b) excessive annual leave accruals, partly or wholly because DILs were being taken in blocks as a substitute for annual leave, leading to excessive annual leave payroll liability (that increased with annual wage rises).

• [34] It is agreed between the parties that there was no claim during bargaining (from either party) with respect to the accrual or deduction rate of DILs. Nor were there any discussions during bargaining about the rate at which DILs accrue and are deducted when taken (as leave) or paid out.[29] In short, what happened during bargaining does not assist in construing the terms of the Agreement to determine at what rate DILs are paid when they are taken as leave.

• [35] It was the RTBU who first proposed the wording of clause 62.6, with the inclusion of the term "single day/s".[30] There was no discussion during bargaining in relation to this term, nor was the term specifically brought to the attention of One Rail by the RTBU during bargaining. Again, what happened during bargaining does not assist in construing the terms of the Agreement to determine whether or not DILs can be taken in blocks (unattached to annual leave).

• [36] The Respondent's practice regarding the accrual and taking of DILs under the 2019 Agreement, and the Agreement, is appropriately summarised (by reference to the evidence) as follows:

"With respect to the accrual of DILs, the Respondent's practice is to record on an employee's file, 7.6 hours for a DIL that is "banked": Cribb [35]. That is, DILs accrue at a rate of 7.6 hours. The Respondent has taken this approach at all times since at least in the 2019 EA: Cribb [38]. This is the same approach taken to annual leave days: Cribb [39]. When a DIL is taken, the 7.6 hours is deducted from the employee's file: Cribb [39].

DILs are approved when taken as a standalone, single day, or in a block with annual leave: Cribb [97]. The Respondent accepts that in some limited cases, clearance of DILs has been approved in blocks without being attached to annual leave: Cribb [97]-[98]; Cameron [31]-[34]. However, such leave was approved only on an ad hoc basis. There was no agreed or usual practice, either during the term of the 2019 EA or the Agreement: Cribb [96]."[31]

• [37] The Agreement covers, and the 2019 Agreement covered, train crew employees who perform Rail Safety Work within New South Wales (exclusively), within the meaning of the Rail Safety National Law 2012 (RSNL). As a result of the RSNL applying, certain shift limits, rest periods, fatigue management priorities, and other regulatory requirements must be observed at all times.[32] These requirements (in respect of safety and fatigue management) are expressly acknowledged at clauses 19, 23 33, 49, and 51.6 of the Agreement. These RSNL fatigue management requirements apply notwithstanding the terms of the Agreement (clauses 23.3 and 23.4), and there is no evidence as to this dispute (around the accruing and taking, or not taking, of DILs) giving, or having given, rise to any 'specific' safety or fatigue management concerns, risks or issues. I observe that the taking of any type of leave (i.e. having unpaid or paid time off and away from work) undoubtedly assists with fatigue management (and overall safety). But DILs are no stand-alone category of leave in this regard. Further, the taking of a DIL as 'pay' or 'leave' is a matter for individual employee discretion (at their election). There is nothing in the Agreement, or on the evidence, that points to an individual employee needing to make their DIL choice (election) by reference to any fatigue management issues, or workplace safety matters. At its core, the ability of employees to elect between being immediately paid 7.6 hours for a public holiday, and accruing (or banking) a DIL (to be taken at a later time, or paid out at anniversary), is simply a beneficial employee entitlement (controlled by employee election). It follows that the issues in this dispute do not concern themselves with fatigue management or safety (i.e. beyond the peripheral).

• [38] The outcome of bargaining resulted in an agreement (set out in clause 62 of the Agreement) to clear (payout) DILs accumulated during the calendar year on each anniversary date of the Agreement, with any carry over of any DIL accruals requiring One Rail's approval.

How do DILs accrue, and at what rate do they accrue? Is One Rail's practice, which is to deduct 7.6 hours from an employee's accumulated DIL bank for each DIL taken, the correct practice?

• [39] In its written submissions, the RTBU's position as to how DILs accrue and are paid, is explained as follows:

"34. The RTBU's position is that appropriate rate of accrual is derived from the entitlement itself, that is to be absent from work for a 'day'. Therefore, the entitlement accrues on occasion as a whole 'day' and is deducted in the same way.

40. Firstly, the plain wording of the phrase 'bank a DIL' suggests a whole day. 7.6 hours is not a whole shift, so providing 7.6 hours is not providing a whole day. To provide only 7.6 hours as the Respondents suggests ignores the plain wording of the clause and would more accurately phrased 'the option to bank 7.6 hours TOIL'. It is undesirable to ignore the plain meaning of the words actually used.

43. As such, having regarding to the surrounding context, it must be accepted there is no ambiguity or uncertainty in the phrase 'option to bank a DIL' and the entitlement must accrue at rate of 1 day, and be deducted in the same way."

"15. ... The Applicant does not contend that employees accrue more than 7.6 hours of value. Rather, the position is that DILs accrue as whole days, not as hourly units. The entitlement is to a day off and the rostered hours missed to be treated as worked."

• [40] In taking the foregoing position, the RTBU says that it does not dispute that when a DIL is paid out, be that at the time of the public holiday (when an election as to payment is made), or when DILs are cleared each year and cancelled (clause 62.7 of the Agreement), they are paid out at the rate of 7.6 hours.[33] The RTBU's case thus rises and falls upon whether or not the words or terms of the Agreement (including by way of context) identify a basis upon which a DIL taken as leave is to be treated differently. But in seeking to rise to this challenge, the RTBU's position ultimately became incoherent and confusing, in that its submissions, going to the basis upon which it asserts that DILs should be paid (when taken as leave) moved from textual considerations within the Agreement to:

(a) "an issue with the way that, when they're [DILs] actually utilised [taken as leave], how that's reflected in their [employee's] payslips";[34]

(b) NES public holiday entitlements, and unfounded assertions as to breaches of same;[35]

(c) comparisons with NES compassionate leave entitlements (notwithstanding that compassionate leave entitlements do not accrue, and are event (or "occasion") based);[36]

(d) comparisons with NES personal carer's leave entitlements (despite rejecting that notional days apply to DILs when taken as leave);[37]

(e) comparisons with NES annual leave entitlements (despite rejecting that DILs are akin to an annual leave entitlement);[38] and

(f) employees being paid for the hours they would have 'actually worked' on the day that a DIL is taken, which may be less than 7.6 hours (e.g. between 5 and 12 hours).[39]

• [41] The taking of a DIL gives rise to an authorised (and paid) leave of absence from work for one day. Whilst the entitlement to accrue a DIL is conferred by reference to the table set out under clause 62.3 of the Agreement, the taking of a DIL results in the relevant employee being absent (obtaining a break away) not only from their ordinary hours of work for the day, but that whole day. It follows that the taking of a DIL provides for a leave of absence for a day (irrespective of the length of the shift (rostered or actual) on that day).

• [42] Given that clause 62 of the Agreement does not define the term "Day" differently to the definition found in the clause 6 of the Agreement, and there is no 'context' before me that points to it being defined differently, I find that the definition of Day in clause 6 applies to the definition of a "Day" In Lieu under clause 62. It follows that the term "Day" in clause 62 does not have an ordinary meaning, but a defined meaning (which is both plain and unambiguous). The RTBU has not identified the context in which the term 'Day' is to be given a meaning other than its defined meaning under the Agreement (i.e. when it comes to a Day of leave (including a DIL taken as leave)).[40] A DIL is a paid leave day. A 'Day' of paid leave under the Agreement is expressly defined as 7.6 hours pay.

• [43] In view of my findings in the foregoing paragraph, I further find that a DIL accrues in the amount of 7.6 hours for each public holiday that an employee becomes entitled to under clause 62.3, and makes an election to receive a DIL. A DIL that is thereafter taken as paid leave (time off) is deducted (or paid) at the exact same rate at which it accrued, i.e. 7.6 hours for each DIL (irrespective of the length of the rostered shift or the actual shift (that would have been) worked on that leave day). None of the contentions as to construction advanced by the RTBU overcome or otherwise undermine this conclusion. Indeed, none of the RTBU contentions as to construction, around the ordinary meaning of words, context (within clause 62, the Agreement as a whole, and/or the NES), history (including bargaining history, and the terms of the 2019 Agreement), positively support its position.

• [44] In making my findings in the foregoing two paragraphs, I also rely upon the following matters:

(a) the context within clause 62 itself (especially clause 62.3, whereby an election as to 'payment' is 7.6 hours);

(b) the context within the Agreement as whole (noting the manner in which rostered hours are averaged over a 12 month period under the Agreement, how Roster B is configured and operates, and the basis upon which employees Annual Remuneration is determined and paid);

(c) the context in which this dispute arose, based (at least in part) upon questions of fairness (which are unrelated to questions of construction);[41]

(d) the Respondent's practice in relation to the accrual, deduction and payment of DILs (all at 7.6 hours), being a practice that was occurring or existed at the time that the Agreement was made, and after it was made, and had been occurring for years under the 2019 Agreement;[42] and

(e) the history of bargaining (identifying an absence of any discussion around the payment to be made when a DIL is taken as leave), and the unaltered terms (clause 62.3) and definitions (clause 6) from the 2019 Agreement.

• [45] To be clear, there is no difference whatsoever to the manner in which a DIL accrues or is paid under the Agreement, i.e. all DILs accrue and are paid at the rate of 7.6 hours per day. That 7.6 hour payment is reflective of a whole day's pay, or a whole day off work. The payment for a DIL is always an hours based exercise (7.6), but it entitles the employee to the whole day off. Issues such as shift length or actual hours worked do not come into the equation at all. This is especially so given the ordinary hours of work, rostering requirements, and annual remuneration arrangements, under the Agreement. Whilst it is unnecessary for me to make findings in relation to the "problematic" issues identified by the Respondent with the RTBU's position, such problems remain very much at large and unanswered by the RTBU in these dispute proceedings.[43]

Does the reference to "single day/s" mean that One Rail's employees are only entitled to take a DIL as a single, non-consecutive day, unless attached to a period of annual leave?

• [46] There is no dispute between the parties that under clause 62.6 of the Agreement, multiple DILs can be added as a block to be taken with a period of annual leave (i.e. if the relevant employee advises the Respondent in a reasonable time frame prior to the commencement date of such [annual] leave).

• [47] The RTBU makes the following submissions in support of its contention that clause 62.6 is not ambiguous, and should be construed as providing for DILs to be taken together (or in blocks), unattached to annual leave:

"46. The RTBU's position that 'single day/s' in that clause does not limit the use of DILs in a way that prevents multiple DILs being utilised together. Once again, the focus is on the plain meaning of the text, but also paying particular regard to the context of the clause in the broader agreement.

48. The RTBU submits the phrase "either as single day/s or with annual leave" should, using normal English language conventions, be read as "single day or days or with annual leave."

49. The inclusion of the plural form "day/s" following the word "single" must be read purposively, acknowledging the common drafting convention in industrial instruments where a forward slash ("/") is used to denote flexibility between singular and plural usage. This structure plainly contemplates more than one single day being taken, not merely a single day at a time. If the drafters had intended to restrict the entitlement solely to individual, non-consecutive days, the phrase "single day" would have sufficed.

50. The alternative presented ('or with annual leave') functions as a separate mode of taking DILs, rather than qualifying or limiting the preceding phrase, it confers an improvement confirming leave types can be mixed to maximise their use. To read "single day/s" as only permitting isolated, non-consecutive days would improperly negate the inclusive function of "day/s" and would disregard the flexible, beneficial reading that enterprise agreement interpretation principles favour, especially in this case where the parties have agreed to approach encouraging use of leave.

51. Contrary to the Respondent's submission, it is the RTBU's interpretation that gives proper effect to all elements in the impugned phrase. The Respondent contends that "single day/s" should be read as "single day or single days" - a construction which renders the "/s" effectively meaningless. That reading offers no practical distinction between "day" and "day/s", and as such, the forward slash adds nothing of substance to the clause.

52. In contrast, the RTBU's interpretation, that "day/s" contemplates both singular and plural uses, including consecutive days, ensures that each element of the phrase has identifiable work to do and reflects a flexible, purposive reading consistent with industrial drafting conventions."[44]

"19. It is in this sense that the Respondent's case is fundamentally flawed. The Applicant's construction is not only available on the text and preferable on an ordinary reading of the language, but it also aligns with the Respondent's own long-standing and continuing practice. To now contend that such approvals are inconsistent with the Agreement is not only unsupported by the text but is also inconsistent with the industrial reality observed by employees when voting to approve the current enterprise agreement."

20. ... The suggestion that the word "single" would be rendered otiose under the Applicant's construction is incorrect. "Single" serves to distinguish between DILs taken independently and those taken in conjunction with annual leave, which is the alternative expressly provided for in the same sentence. The structure of the clause is conjunctive: it permits DILs to be taken as single day or days, or attached to a period of annual leave. The word "single" operates to clarify that DILs need not be part of a broader leave period in order to be exercised, not to impose a prohibition on multiple consecutive DILs."[45]

• [48] In addition to its submissions as to text and context,[46] the Respondent makes the following submissions in support of its contention that clause 62.6 is not ambiguous, and should be construed as providing for DILs to be taken as single days only (when unattached to annual leave), or in blocks (attached to annual leave):

(a) the word "single" means free-standing, and is in contradistinction to words such as "consecutive" or "multiple";

(b) if the RTBU's construction of clause 62.6 is correct, there would be no need for the words "either as single day/s or with annual leave", i.e. these words would be completely otiose in that DILs can be taken as leave howsoever an employee requests, subject only to questions of unreasonable refusal by One Rail; and

(c) the RTBU's contention that annual leave cannot be taken in single days under the Agreement is plainly wrong. The use of the word 'single day/s' in clause 62.6 is not motivated by any restrictions associated with the taking of annual leave in single days.

• [49] From a textual perspective in relation to clause 62.6, I make the following findings:

(a) the term "single" must be given work to do. Of course, context is important, but that context must does not make the word single invisible or otiose, or give rise to it meaning something other than its ordinary meaning (i.e. unless there is a clear intention to the contrary). The ordinary meaning of the word "single" is "only one; not one of several" and "an individual person or thing rather than part of a pair or a group" and "only one in number; one only; unique; sole";

(b) the slash (/) and the "s" after the word 'day' identify two outcomes, a single day being taken as leave, or (the plural) more than one single day being taken as leave. In short, the slash is a reference to a single day, or single days. On both applications, the ordinary meaning of the word single has work to do;

(c) the term single day/s and the words "with annual leave" are separated by the word "or", and are prefaced by the word "either". They are two alternatives, being two alternatives that are not the same thing. These two alternatives are for DILs to be taken as (either) a single day, or, as something other than a single day (the latter with annual leave). Absent express words to the contrary, the alternative to (or opposite of) a single day, or single days, is multiple or consecutive days "with [attached to] annual leave".

• [50] From a context perspective, in relation to the Agreement as a whole, I make the following findings:

(a) The Agreement uses the term "blocks" to describe multiple days or hours together (e.g. 4 on, 4 off,[47] 8 hour blocks,[48] one week or more[49]).

(b) Clause 67.6 of the Agreement makes an express distinction between "single" and "multiple" days of leave. It reads:

"Employees can access the full amount of leave from the day they start work. The leave can be taken a [sic] single or multiple days or as part days by agreement. An employee's leave balance renews each year on their work anniversary but doesn't accumulate from year to year if it is not used."[50]

(c) Clause 73.4 of the Agreement makes an express distinction between "single days" and "blocks" of leave. It reads:

"As part of the ERC the parties will monitor and discuss issues of significance regarding the EBA and the implementation and effectiveness of the Roster. As part of this process, the Company will review how annual leave and DIL days are approved and will consult with the ERC and consider opportunities for improvement. The Company will also consult the ERC as to the process for taking leave in both single days and blocks of leave."[51]

(d) DILs are a separate and different entitlement to annual leave.[52]

(e) Annual leave can be taken in single days. Indeed, nothing in the Agreement says otherwise.

• [51] Beyond the ad hoc, there is no established custom and practice (on the evidence) as to the approval for DILs to be taken in blocks (unconnected to annual leave). The resolution of this dispute does not concern itself with what the Respondent might have done, or might do (as a matter of its absolute discretion) from time to time. Such exercise of discretion, or past practice, made on a case by case basis, does not set up some form of precedent as to the interpretation of the Agreement, or the application of the words in clause 62 of the Agreement. Rather, the issues in this dispute seek to determine what the Agreement says and requires. Importantly, there is simply no evidence as to the circumstances in which DILs were approved in blocks previously for any specific employee/s, such that the Respondent's past practices in this regard arise for scrutiny and consideration, or can be given any substantive weight.

• [52] The RTBU's interpretation of clause 62.6 is not counterbalanced by clause 62.9 (reasonable refusal). Clause 62.6 governs the parameters of what can be requested. In other words, clause 62.6 concerns itself with what type of request for DILs (as leave) can be made, i.e. the taking of a DIL as a single day, or, in blocks (or consecutive DILs attached to) annual leave. If a request is made for DILs to be taken in blocks unconnected to annual leave, issues of reasonable refusal do not arise because the request is not permitted in the first place under clause 62.6. Thus, the request to take DILs in blocks unconnected to annual leave is a request that clause 62.6 does not permit to be made in the first place. It can simply be refused, absent any requirement to consider the reasonableness of such a request under clause 62.9. To be clear, issues of reasonable refusal do not arise unless there is a valid request made within the parameters set by clause 62.6.

• [53] Both parties submit that the term "single day/s" in clause 62.6 of the Agreement is unambiguous, i.e. that it is not susceptible to more than one meaning. I concur with the position of the parties in this regard. However, to the extent that there might be said to be ambiguity (patent or latent) that is not resolved by the other words set out in clause 62 of the Agreement, evidence of "surrounding circumstances" is admissible to assist in the interpretation of the Agreement. Such surrounding circumstances are limited to the "objective framework of facts", being objective background facts known to both parties (being notorious facts to which knowledge is presumed), matters of common contemplation and assumption, and mutual intentions (i.e. the mutuality makes the evidence of intention admissible). What cannot be taken into account is evidence of statements and actions of the parties which are reflective of their own intentions and expectations.[53]

• [54] In terms of surrounding circumstances, the following matters are relevant:

(a) with respect to DILs, it is evident that the communications between the parties in and around bargaining were focussed upon whether or not a DIL could be retained past the anniversary date.[54] Such discussions did not extend to the taking of DILs as a single day, or in blocks.

(b) the evidence does not disclose some form of common understanding or common contemplation as to the approval for DILs to be taken in blocks (unconnected to annual leave).

(c) the wording used to explain the terms and effect of the terms of the Agreement to relevant employees was drafted by Mr Cameron of the RTBU, and later picked up by One Rail.[55] Relevantly, that wording states: "DILs can be taken as single days or with annual leave".[56] This takes the construction no further as it concerns clause 62.6.

(d) as I understand it, the RSW (NSW) Annual Leave & DIL Principles (or Guidelines)[57] have not been agreed between the parties. In any event, the terms of these Principles do not form part of the terms of the Agreement. At best, they are One Rail's internal guidelines, being guidelines that cannot override the express terms of the Agreement.[58] The Principles take the construction of clause 62.6 no further.

• [55] It follows that even if a finding was made as to ambiguity in relation to clause 62.6, surrounding circumstances (including extrinsic evidence) do not assist in resolving such ambiguity (i.e. the resolution of any such asserted ambiguity reverts back to the text of clause 62.6 read in the context of the Agreement as a whole).

• [56] The RTBU says that One Rail's interpretation of clause 62.6 gives rise to a non-negotiable barrier to the taking of DILs. I disagree. There is nothing stopping DILs being taken in blocks provided they are attached to annual leave. The question in this dispute is whether employees can demand or require that One Rail consider a request for an employee to take DILs in blocks unattached to annual leave subject to issues of reasonableness. The answer is that they cannot. Rather, the employee must make a request for annual leave (which is subject to such annual leave being taken at a "mutually convenient time" (clause 57.4.1 of the Agreement), or at a time determine by One Rail (clause 57.4.2 of the Agreement)). As part of such request for annual leave, the employee may also (at the same time) make a request for multiple DILs to be added to such annual leave. One Rail must not unreasonably refuse such a request in respect of DILs being cleared.

• [57] On the basis of the reasons set out in this decision, I answer the questions posed in this dispute, as follows:

1. What does "day" mean in the context of an employee's entitlement to a day in lieu (DIL) under clause 62 of the One Rail Australia (FLACH) Pty Ltd, NSW Coal Haulage Enterprise Agreement 2023 (the Agreement)?

Answer: 7.6 hours for each day (DIL) paid, paid out at Agreement anniversary each year, or taken as leave.

1. How do DILs accrue, and at what rate do they accrue?

Answer: At the rate of 7.6 hours for each day (DIL).

1. Is One Rail's practice, which is to deduct 7.6 hours from an employee's accumulated DIL bank for each DIL taken, the correct practice?

1. If the answer to question 1(b) is "No", what is the correct treatment when deducting a DIL from an employee's accumulated DIL bank?

2. What is the correct interpretation of "single day/s" in clause 62.6 of the Agreement?

1. Does the reference to "single day/s" mean that One Rail's employees are only entitled to take a DIL as a single, non-consecutive day, unless attached to a period of annual leave?

1. If the answer to question 2(a) is "No", does the reference to "single day/s" confer an entitlement for One Rail's employees to take DILs as multiple, consecutive days, even when not attached to a period of annual leave?

Mr Peter Matthews, RTBU Legal Officer, appeared for the Australian Rail Tram and Bus Industry Union (Applicant)

Ms Catherine Bemcrick, of Counsel, instructed by Mr Stephen Price, Partner, Corrs Chambers Westgarth lawyers, appeared (with permission) for One Rail Australia (FLACH) Pty Ltd T/A One Rail Australia (Respondent).

[1] Digital Hearing Book (Court Book, CB), pp. 13-56. See also Respondent's (initial) Response: CB, pp.57-182.

[2] One Rail Australia (FLACH) Pty Ltd, NSW Coal Haulage Enterprise Agreement 2023 (Agreement) [2023] FWCA 2402 (2 August 2023, Beaumont DP), AE520974 , PR764831. CB, pp.65-117.

[3] CB, pp.109-110. Respondent's Submissions, at [5], CB, pp.292-293.

[4] Clauses 62.5 and 62.7 of the Agreement, CB, p.106, noting the ability to mutually agree to retain accrued DILs post Agreement anniversary date (clause 62.8, CB, p.106).

[5] A Book Off Day is a day that is not worked, i.e. a day that is rostered off during the roster cycle and does not count as a roster shift. See Clause 6 (Definitions), CB, p.72.

[6] A 'Transition Day" (or T Day) is a day that an employee does not work, but is paid. It is used to allow for changes to shift patterns between night and morning shifts, and to balance out annual leave payments. See Clause 6 (Definitions), CB, p.72, and Cribb Statement, at [27], CB, p.309: "They are also deducted at 7.6 hours when attached to annual leave, for payroll purposes."

[9] CB, p.9. I accept that these questions are the correct questions to be asked and answered in resolving this dispute.

[10] [2017] FWCFB 3005, at [114].

[11] [2020] FCAFC 123; (2020) 278 FCR 566, at [65].

[12] [2020] FWC 2130.

[14] Rail Industry Award 2020 (Award), at clause 27.

[17] Cribb Statement, at [12] and [16]. CB, pp.306-307.

[19] Clause 6 of the Agreement, CB, p.72.

[20] Compare, Applicant's Submissions, at [60], CB, p.199; Applicant's Reply Submissions, at [21], CB, p.578.

[21] Clause 6 of the Freightliner Australia Coal Haulage Pty Ltd Enterprise Agreement 2019 (2019 Agreement), CB, p.129. See also paragraph [21] of this decision.

[22] Cribb Statement, at [100], CB, pp.320-321; Cameron Statement, at [21], CB, p.194. Compare dispute resolution outcome in 2021, Respondent's Submissions, at [22], CB, p.295.

[23] Cribb Statement, at [84]. CB, p.318.

[26] Cribb Statement, at [84]-[91], CB, pp.318-319, and Cameron Statement, at [37], CB, p.196.

[29] Applicant's Submissions, at [23], CB, p.186. Cribb Statement, at [100], CB, pp.320-321; Cameron Statement, at [21], CB, p.194. Compare dispute resolution outcome in 2021, Respondent's Submissions, at [22], CB, p.295.

[30] Cribb Statement, at [77], CB, p.317. Draft version of the Agreement circulated by Mr Greogory Cameron, RTBU Organiser, in May 2023. Transcript, PN61.

[31] Respondent's Submissions, 17 April 2025, at [30]-[31], CB, pp.296. I make findings consistent with these submissions (and the evidence referred to therein) for the purposes of this decision.

[32] By application and operation of the Rail Safety National Law 2012, and s.27 of the Fair Work Act 2009. Cribb Statement, at [24(c)], CB, pp.308-309.

[40] The modes of textual analysis developed in the general law may assist in the interpretation of enterprise agreements. The RTBU's submissions do not support a conclusion that the presumption that the defined term "Day" under clause 6 of the Agreement is to be applied other than consistently under clause 62.3 of the Agreement. In other words, the RTBU has not pointed to anything probative (by way of context, purpose, or surrounding text) that results in a rebuttal of this consistency presumption. See Registrar of Titles (WA) v Franzon [1975] HCA 41; (1975) 132 CLR 611, at 618 (per Mason J); Tabcorp Holdings Ltd v Victoria [2016] HCA 4; (2016) 90 ALJR 376, at [65] (per French CJ, Kiefel, Bell, Keane and Gordon JJ); Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs [2021] HCA 19; (2021) 273 CLR 21, at [25]. Compare: Clyne v Deputy Federal Commissioner of Taxation (1981) 150 IR 1, at 15 (per Mason J); Federal Commissioner of Taxation v Australian Building Systems Pty Ltd (in liq) [2015] HCA 48; (2015) 257 CLR 544, at [27] (French CJ and Kiefel J); Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union and Others (The Laverton North and Cheltenham Premises Case) [2018] FCAFC 88; (2018) 262 FCR 473, at [3] (per Allsop CJ).

[41] The RTBU says that the context to this dispute (as to payment for a DIL when it is taken as leave) arises (at least in part) via one of its members stating: "It's not fair because the roster's based on 11 hours. You only get deducted 7.6 [hours]" (see Transcript, PN309). Again, this dispute does not concern itself with resolving questions of fairness.

[42] Cribb Statement, at [36]-[40], CB, p.311.

[43] Respondent's Submissions, at [46]-[62], CB, pp.298-300. Transcript, PN346-PN375. Applicant's Reply Submissions, at [8]-[17], CB, pp.576-578.

[44] Applicant's Submissions, at [46], and [48]-[52], CB, pp.188-189.

[45] Applicant's Reply Submissions, at [19]-[20], CB, p.578.

[46] Respondent's Submissions, at [63]-[87], CB, pp.300-303.

[47] Clause 6, definition of "Roster B" of the Agreement, CB, p.73.

[48] Clause 32.3.1 (Temporary Transfer) of the Agreement, CB, p.91.

[49] Clause 57.5.3 (Annual Leave) of the Agreement, CB, p.99.

[50] Clause 67.6 of the Agreement, CB, p.107.

[51] Clause 73.4 of the Agreement, CB, p.111.

[52] Clause 57.5.1 of the Agreement, CB, p.99.

[53] Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union' known as the Australian Manufacturing Workers Union (AMWU) v Berri Pty Limited [2017] FWCFB 3005; (2017) 268 IR 285, at [60]-[65], [98], and [114]. BP Australia Pty Ltd v Nyran Pty Ltd [2003] FCA 520, at [33]-[34].

[54] Cribb Statement, at [72]-[75], CB, p.316-317; Cameron Statement, at [26], CB, p.195.

[55] Cameron Statement, at [29]-[30], CB, p.195.

[58] CB, p.36: "These guidelines work in conjunction with the EA. Where there is conflict between the Annual Leave Policy and the, the terms of the Enterprise Agreement shall prevail."

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