SECOND ISSUE
37 The second issue is whether the Director had power to rescind or revoke the decision that the Merivale Agreement did not pass the fairness test. As noted above, the letter from the Acting Director dated 4 June 2009 in fact informed Merivale that a decision had been made to revoke the original notice that the fairness test had not been passed. That was the notice dated 15 December 2008.
38 Merivale submitted that, under s 33(3), or alternatively s 33(1), of the Acts Interpretation Act 1901 (Cth) (AI Act), the Director had power to revoke and remake the earlier decision that the Merivale Agreement did not meet the fairness test or the notice to that effect. Sections 2, 33(1) and (3) of the AI Act (as they stood at the time of the Rescission Decision) provided:
2 Application of Act
(1) Except so far as the contrary intention appears, this Act applies to all Acts, including this Act.
(2) This Act shall bind the Crown.
…
33 Exercise of powers and duties
(1) Where an Act confers a power or imposes a duty, then, unless the contrary intention appears, the power may be exercised and the duty shall be performed from time to time as occasion requires.
…
(3) Where an Act confers a power to make, grant or issue any instrument (including rules, regulations or by-laws) the power shall, unless the contrary intention appears, be construed as including a power exercisable in the like manner and subject to the like conditions (if any) to repeal, rescind, revoke, amend, or vary any such instrument.
39 Merivale submitted that:
(1) the Acting Director validly revoked the First Fairness Test Decision by the Rescission Decision on 4 June 2009;
(2) the effect of the Rescission Decision was that the Merivale Agreement as lodged commenced to operate again, but only prospectively, as from the date of the Rescission Decision;
(3) it remained to be determined whether the Merivale Agreement as lodged passed the fairness test: s 346E(2) and s 346M;
(4) by the Second Fairness Test Decision, the Director provided notification that the Merivale Agreement did not meet the fairness test: s 346P;
(5) Merivale was then entitled to lodge a variation of the Merivale Agreement by undertaking, pursuant to s 346R(2)(b), as it did on 11 June 2009;
(6) that undertaking came into effect when it was lodged: s 346T(2);
(7) the Director was required to decide whether the Merivale Agreement, as varied on 11 June 2009, passed the fairness test: s 346U(1));
(8) by the Second Undertaking Decision, the Director decided that the Merivale Agreement, as varied on 11 June 2009, passed the fairness test: s 346U(2);
(9) the effect of that decision was that the agreement as varied continued in operation: s 346X(a).
40 The applicant submitted that s 346ZB of the Pre-transition WR Act prevented the Merivale Agreement from operating, once it ceased to operate and that s 346ZB prevented what might otherwise be the operation of s 33 of the AI Act because it evidenced a contrary intention for the purposes of s 2(1) of the AI Act. Section 346ZB provided:
346ZB Operation of workplace agreements
A workplace agreement that has ceased to operate because it does not pass the fairness test can never operate again.
41 It is convenient to address the applicant's position first given that, if it is correct, it would not matter what otherwise might be the operation of s 33(1) or (3): s 2(1) of the AI Act.
42 Section 346ZB has not been the subject of any judicial consideration. Merivale submitted that s 346ZB has nothing to say about the operation of an agreement in circumstances where the decision that the agreement does not pass the fairness test is revoked. Merivale submits that, if s 346ZB were read literally, a workplace agreement could never operate again even if the decision that the agreement did not pass the fairness test were set aside by a court. According to Merivale, that plainly cannot be the case and, once it is accepted that s 346ZB does not prevent an agreement from operating, where a decision that the agreement did not pass the fairness test is set aside by a court, it follows that it also does not prevent an agreement from operating again where a decision that the agreement did not pass the fairness test is otherwise revoked. Section 346ZB no longer applies in those circumstances because the agreement is no longer an agreement that does not pass the fairness test.
43 Merivale submitted that, having regard to its context, s 346ZB has a narrower operation than at first appears from the ordinary meaning of the words. Merivale submitted that the provisions which precede s 346ZB (namely ss 346Y to 346ZA) deal with the employment arrangements that apply if a workplace agreement ceases to operate because it does not pass the fairness test and that, in general terms, the effect of those provisions is that the employer and employee become bound by the instrument or instruments that would have applied, but for the agreement that has now been found not to pass the fairness test (see ss 346Y(2) and 346YA(2)). In some circumstances, that has the effect that an agreement that has ceased to operate will revive. Section 346ZB is directed towards whether an agreement that does not pass the fairness test can operate again in that specific context. Merivale contended that this construction is further supported by the fact that there are express exceptions to the operation of s 346ZB contained in those provisions - see: ss 346Y(3) and 346YA(4).
44 Merivale also submitted that there is no good reason to treat the statutory scheme as having been intended to be entirely inflexible, admitting no possibility of mistakes.
45 I do not accept this argument. The concept of a workplace agreement 'ceasing to operate' is central to the operation of Div 5A and, more specifically, to the operation of Subdivision D entitled "Consequences if a workplace agreement does not pass the fairness test". The concept is one used throughout the Subdivision. Section 346ZB is in Div 5A, Subdivision D. It provides the consequence if "a workplace agreement ceases to operate". Section 346R(3), for example, provides:
(3) If the employer does not take the action referred to in subsection (2) within the relevant period in relation to the workplace agreement, then at the end of that period:
(a) the workplace agreement ceases to operate; and
(b) the employee or employees whose employment was at any time subject to the workplace agreement are, after the end of the relevant period in relation to the workplace agreement, entitled to any compensation payable to the employee or employees under section 346ZD.
46 As can be seen, once "the workplace agreement ceases to operate", s 346R(3)(b) provides that an employee whose employment was subject to the workplace agreement will be entitled to compensation. It is plain that s 346ZB was intended to state the consequences if a "workplace agreement ceases to operate" by reason of s 346R(3)(a). The fact that, upon the workplace ceasing to operate, employees became entitled to compensation also tells against a power to rescind. It is not a complete answer to this fact that, because a decision to revoke is only prospective in operation (see Minister for Indigenous Affairs v MJD Foundation Ltd (2017) 250 FCR 31 at [42]-[47] (Perram J)), the employee remains entitled to compensation.
47 Another example - perhaps closer to the applicant's heart - is s 346W, which provided:
346W Effect if varied agreement does not pass fairness test - agreement in operation
If the Workplace Authority Director decides under subsection 346U(1) that a workplace agreement as varied does not pass the fairness test:
(a) the workplace agreement ceases to operate on the date of issue specified in the notice under that section in respect of the workplace agreement; and
(b) the employee or employees whose employment was at any time subject to the workplace agreement are, on and from the date of issue specified in the notice under section 346U in relation to the workplace agreement, entitled to any compensation payable to the employee or employees under section 346ZD.
48 Again, it is plain that s 346ZB was intended to state the consequences if "a workplace agreement ceases to operate" by reason of s 346W(a).
49 The operation of s 346ZB would not have prevented the coming into existence of a new workplace agreement. But it does prevent the one which had been lodged from ever operating again. There is nothing about the statutory scheme or the structure of the provisions which suggests that s 346ZB should not be read in accordance with its ordinary meaning. Section 346ZB supplies the consequences if a workplace agreement "ceases to operate". The provision should be given its natural and ordinary meaning.
50 Further, in highly regulated statutory schemes such as this, it is usual to see the consequences of particular events, and the methods (if any) by which those events can be reviewed or undone, fully set out. If it were intended that fairness test decisions could be revoked and remade one would expect that to have been dealt with expressly in the legislation given the highly regulated structure shown in Div 5A. Merivale submitted that s 33 of the AI Act works hand in hand with the statute and supplies the missing power. I accept that would be the case if Div 5A had not indicated that it was not intended that there be a power to revoke or rescind a fairness test decision.
51 In my view, Div 5A of the Pre-transition WR Act, read in context, indicates that the legislature should be taken to have intended that:
(1) If an employer did not take action under s 346R(2), within the relevant 14 day period (s 346R(7)), then - at the end of the period - the workplace agreement "ceases to operate" and "can never operate again": s 346R(3)(a); s 346ZB;
(2) once a decision was made under s 346U that an agreement varied under s 346R(2)(b) did not meet the fairness test, then the varied agreement "ceases to operate" and "can never operate again": s 346W(a); s 346ZB.
52 This reveals an intention that there not be power on the part of the Director to rescind a decision that a workplace agreement does not pass the fairness test.
53 It follows that it is not necessary to consider whether, if the contrary intention had not appeared in the Pre-transition WR Act, s 33(3) or (1) would have operated such that the Director could revoke and remake a fairness test decision under Div 5A of the Pre-transition WR Act.
54 Nevertheless, I will state my views briefly in relation to s 33(3). In relation to s 33(1), Mortimer J (with whom Perry J agreed) expressed an obiter view in MJD which would have the result that Merivale's argument should be rejected. Perram J expressed a view about the operation of s 33(1), embraced by Merivale, which would have the result that Merivale's argument should be accepted. Given that I have concluded that there is a contrary indication such that s 33(1) of the AI Act cannot apply (by reason of s 2(1) of the AI Act), and that both sides of the argument are fully set out in MJD, I prefer to express a view about that issue in a case where it is necessary to be decided.
55 Merivale submitted that the relevant power for the purposes of s 33(3) was one furnished by a combination of ss 346E(2), 346M and 346P. This power was, in Merivale's submission, a power to issue an instrument, namely a notice under s 346P. In my view, the better construction of the provisions is that the relevant power is to make a decision about whether a collective agreement passes the fairness test: s 346E(2). The Director must notify the decision reached by reason of s 346P, and that notification has a series of consequences, including setting the time for the purposes of s 346R(2)(b) for lodging a variation by way of undertaking to vary: s 346P(3), (5); s 346R(7). The fact that the notification has legal consequences does not, of itself, imply that the notification is to be regarded as part of the relevant power. The power here is to determine whether the fairness test was passed. Once exercised there was an obligation to notify the result - cf: Flaherty v Secretary, Department of Health and Ageing (2010) 184 FCR 564 at [58]-[63]. This case is distinguishable from one in which, for example, the power is to grant a licence which pursuant to the power conferred will create legal rights and liabilities.
56 Merivale also submitted that s 33(3) furnished power to revoke the notice under s 346P, as opposed to the decision under s 346E(2). The problem with this submission is that, assuming that were correct, that would leave in place the decision under s 346E(2). The Director was under a statutory obligation to notify that decision: s 346P(2). It would be a nonsense to conclude that there is a power to revoke a notification of a decision which cannot itself be revoked and which the statute expressly requires be notified.
57 It follows that the Rescission Decision and the subsequent decisions were not authorised and were beyond power.