Fair Work Commission|2025-07-02

Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Ausgrid Management Pty Ltd Trading AS Ausgrid [2025] FWC 1896 (2 July 2025)

[2025] FWC 1896 [Note: An appeal pursuant to s.604 (C2025/6828) was lodged against this decision.]

s.739 - Application to deal with a dispute

Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia

[1] This is an application by the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU), operating as the ETU in New South Wales for the Fair Work Commission (Commission) to deal with a dispute with Ausgrid Management Pty Ltd Trading as Ausgrid (Ausgrid) in accordance with a dispute resolution procedure.

[2] The dispute relates to Clause 20 of Appendix 4 of the Ausgrid Enterprise Agreement 2024 (2024 Agreement). Clause 20 contains a table which provides that at commencement of the 2024 Agreement, all employees will progress one level within their band (or receive a payment of $2,500 if they are at the top of their band). This entitlement is expressed in the table as follows:

Progression: 1 Level (single and multi band roles); or

[3] The 2024 Agreement commenced on 14 February 2025. The ETU contends that progression is based on the level employees held on 14 February 2025, that employees are entitled to progress one level on that date and that employees are entitled to payment at this new level backdated to 1 September 2024.

[4] Ausgrid contends that progression is based on the level employees held on 1 September 2024, that employees are entitled to progress one level on that date and that employees are entitled to payment at this new level backdated to 1 September 2024.

[5] The new level held by an employee and the back payment received will be the same for an employee who held the same level during the period from 1 September 2024 to 14 February 2025 regardless of whether the contentions of the ETU or Ausgrid are accepted. However, the positions held by the ETU and Ausgrid result in different consequences for employees who either commenced employment, moved up one level, or were promoted after 1 September 2024 and before the 2024 Agreement commenced.

[6] The parties agree that the question for determination by the Commission is:

Does the first row of the first table in clause 20.1 in Appendix 4 of the 2024 Agreement provide employees with one level of progression based on the level that the employee held on 1 September 2024 or the level they held on the commencement of the Agreement (14 February 2025)?

[7] The dispute resolution procedure is at clause 41 of the 2024 Agreement. There is no dispute between the parties that the dispute resolution procedure has been followed, and that the Commission has jurisdiction to determine the matter pursuant to s.739 of the Fair Work Act 2009 (Cth) (FW Act).

[8] In May 2024, the ETU commenced bargaining with Ausgrid for the 2024 Agreement. The previous enterprise agreement, the Ausgrid Enterprise Agreement 2021 (2021 Agreement) had a nominal expiry date of 1 July 2024.[1] The last pay increase under the 2021 Agreement occurred on 1 September 2023.

[9] The 2021 Agreement covered Ausgrid's frontline employees at its operational depots and corporate offices, as well as the majority of middle and frontline managers and supervisors within Ausgrid. The 2024 Agreement has nearly identical coverage to the 2021 Agreement.[2]

[10] During bargaining, employees were represented by seven unions and four individual bargaining representatives. The majority of employees were represented by the ETU.[3] Ms Tara Koot, ETU Organiser, led the bargaining on behalf of ETU members.[4]

[11] Ms Koot's evidence was that two key issues throughout bargaining were wages and changing the Career Capability and Remuneration (CCR) Framework in Appendix 4 of the 2021 Agreement.[5]

[12] According to the 2021 Agreement, the CCR Framework was a broad-banded pay structure. 'Work Level Standards' provided a framework to differentiate 'Positions' (grouped into 'Bands') based on the complexity of work undertaken by employees. 'Streams' set out the nature of work undertaken by employees and each Band was divided into 'Levels'. Progression to Levels within a Band was based on employee performance as part of the annual performance cycle. Promotion between Bands was through a selection process based on merit.

[13] Clause 11 of the 2021 Agreement provided that an employee who had the minimum capabilities required of their current role would move from:
- Level 1 to Level 2 in their Band only if their performance rating at the conclusion of a completed annual performance cycle at their existing level was 'Meets Expectations' or 'Exceeds Expectations'.
- Level 2 to Level 3, Level 3 to Level 4, or Level 4 to Level 5 in their Band only if their performance rating at the conclusion of a completed annual performance cycle at their existing level was 'Exceeds Expectations'.

[14] Ms Koot explained that the CCR Framework was an important issue for ETU members during bargaining. She said that the wording within the Work Level Standards Framework was very vague and that there was not a simple way to see the differences between the Bands. Many members were not progressing a level within a Band although they received a rating of 'Exceeds Expectations' at the end of their annual performance cycle. Ms Koot said that this was because Ausgrid would only allow a few workers whose performance level was 'Exceeds Expectations' to progress to the next level due to management discretion. One of the claims that the ETU made on behalf of members during bargaining for the 2024 Agreement was to amend the CCR Framework to address their concerns about progression within and between Bands.[6]

[15] Mr Matthew Sweeting, Head of Works Planning and Contract Delivery gave evidence on behalf of Ausgrid. Mr Sweeting said that Ausgrid put forward a number of offers to bargaining representatives over the course of roughly eight months of bargaining. Ausgrid also put two of these offers directly to employees by asking them to vote in relation to a new Agreement at two ballots in September and October 2024, but employees voted to reject those offers.[7] The initial wages proposal from Ausgrid was 7% or CPI on 2 July 2024 then annual increases of CPI in 2025 and 2026.[8] The subsequent wages proposal from Ausgrid increased the 2025 and 2026 increases to 2.7% or CPI (whichever is higher).[9]

[16] The ETU's initial wage claim was 8% per year for three years commencing on 2 July 2024.[10]

[17] On 12 November 2024 during a further bargaining meeting, the ETU put forward a revised wages proposal of:

[18] The ETU's revised offer was rejected by Ausgrid.[12]

[19] On or around 18 November 2024, Ausgrid filed an application pursuant to s.240 of the FW Act with the Commission (s.240 Application). At that time, the key outstanding issues in relation to bargaining for the 2024 Agreement were:

(b) various aspects of Appendix 4 of the 2024 Agreement;

[20] On 22 and 27 November, and 2 and 3 December 2024, the ETU and Ausgrid attended conciliation conferences facilitated by Commissioner Riordan in relation to the s.240 Application.[14] At the end of the conciliation conference held on 3 December 2024, the parties reached an in-principle agreement as to the terms of the 2024 Agreement.[15]

[21] The in-principle agreement was conveyed to employees on 4 December 2024 by way of a joint communication from the ETU and Ausgrid which included the following table:[16]

Three years from 1 September 2024 (expires 1 September 2027)

7% wage increase
0.5% super increase
Guaranteed single level progression including multi-band roles

Guaranteed single level progression including multi-band roles

*to be backpaid following approval by the Fair Work Commission

CPI or 3% (whichever is higher)
0.5% super increase

R&P fully implemented - assessment period for previous 12 months

Early morning shift 7.5%
Afternoon shift 15%
Night shift 22.5%

These new rates come with a guarantee that no worker can be worse off by moving to the above percentages

A one level increase for an entry level Lineworker equates to a 2.34% increase.

The overall average for a one level increase across Bands A1, A2, B1, B2, C1, C2, D1, D2 is 2.08%. This average figure is indicative only and employees will need to determine the actual percentage increase for their relevant Band and level.

The guaranteed wage and level increases over the life of the agreement for a current new to trade (entry) employee (i.e. currently Band A2 Level 3) will be 21.3%  (inclusive of Ausgrid allowance increase).
Should the same new to trade (entry) employee meet the criteria for a level increase on 1 July 2027, the total wage and level increases over the life of the agreement would increase by 23.6% (inclusive of Ausgrid allowance increase).

[22] Mr Sweeting said his understanding of how the in-principle agreement would be implemented in Year One was that:

(a) all eligible employees would receive a wage increase of 7% backdated to 1 September 2024; and

(b) a pay or level progression would be applied from 1 September 2024 of either a single level or a $2,500 payment for those at the top of their band. This progression or payment would be effective from 1 September 2024 and applied to the roles held by employees on 1 September 2024.[17]

[23] Mr Sweeting said that this approach reflected the modelling that Ausgrid undertook during the conference to determine that the in-principle agreement was within its budget envelope across the three years of the 2024 Agreement.[18]

[24] Following the in-principle agreement on 3 December 2024, a full draft of the 2024 Agreement was prepared by Ausgrid and sent to all bargaining representatives by email on 6 December 2024. That draft included clause 20 of Appendix 4 of the 2024 Agreement. The union bargaining representatives provided feedback on the draft 2024 Agreement on 9 December 2024 but did not provide any comments or amendments on the table in clause 20.1 of Appendix 4.[19]

[25] Clause 20 of Appendix 4 of the 2024 Agreement provides:

20.1 The following implementation rules apply and exclude Clause 11.2 (Progression) and Clause 19 (Top of Band) of this Appendix:

Progression: 1 Level (single and multi band roles); or

Clause 20 of this Appendix does not apply to the FY27 annual review & feedback cycle.

* Paid from the first full pay cycle that occurs 7 business days following notification of approval of the Ausgrid Enterprise Agreement 2024 by the FWC

• Where an employee is acting in a Higher Band under this Appendix, the guaranteed 1 level progression or Top of Band payments on 1 September 2024 and 1 July 2025 will be applicable to their substantive role.

• On commencement of this Agreement, Graduates will receive, a payment of $2500 which will be paid within the first full pay cycle that occurs seven (7) business days following notification of approval of the Ausgrid Enterprise Agreement 2024 by the FWC.

• Graduates will only progress as per clause 5.7 of this Appendix

[26] Clause 11.2 of Appendix 4 of the 2024 Agreement is excluded from the implementation rules of the Remuneration and Progression (R & P) Framework. It provides:

An employee will move one (1) Level in their band if:

11.2.1 they have completed at least 6 months of the annual review and feedback cycle at their existing level of that Band; and
11.2.2 they have not underperformed in their current Role.

11.2.3 Subject to Clause 12 of this Appendix, an employee can only move one (1) Level in any one annual review cycle.

[27] Mr Sweeting's evidence was that in the draft version of the 2024 Agreement that Ausgrid sent to bargaining representatives on 6 December 2024, clauses 11.2.2 and 11.2.3 had been excluded for the purposes of the implementation rules in clause 20.1 but clause 11.2.1 had not been.[20]

[28] On 10 December 2024, Mr Sweeting received two emails from Peter Kramel, Engineering Officer and Senior Delegate of the ETU at 1:57pm and 2:03pm. All bargaining representatives were copied into Mr Kramel's emails.[21]

[29] In these emails, Mr Kramel asked for clause 11.2.1 of Appendix 4 to the 2024 Agreement to be excluded for the purposes of the implementation rules in clause 20.1, so that employees who had been recently promoted or appointed to a higher band or level would receive the benefits of clause 20.1 even if they had not been in their new position for six months as at 1 September 2024. Mr Kramel's initial email relevantly provided:

If 11.2.1 of Appendix 4 is not excluded, every employee who got a level increase at the end of the last cycle in July this year and every employee who has been streamlined promoted or merit appointed to a new band and has not had six months in that position at 1/09/2024 will not get a level increase or bonus on approval of the agreement. Is this correct?[22]

[30] A few minutes later, Mr Kramel sent a second email which relevantly provided:

Further to my previous statement/question, given we are not getting an increase or bonus in 25/26 cycle, it stands to reason that the Sept 24 level increase or bonus is being brought forward from then and everyone should be given the first level increase because of that.

[31] Mr Paul York, Head of Employee Relations at Ausgrid, responded to both emails. Mr York's response relevantly provided:

As discussed, the intent of excluding 11.2.1 was to avoid a new employee (eg someone who commences in March 25) getting a bump up in July 25 when they have less than 6 months service. To simply [sic], we will exclude 11.2.1. On further consideration, new employees will be eligible for July25 bump noting the next progression point is July 27.[23]

[32] Mr Sweeting said that he understood from these emails that Mr Kramel's request was made to ensure that employees who had recently been promoted or appointed to a higher band or level would be assessed on the basis of the role they held as at 1 September 2024 for the purposes of the first instance of single level progression, regardless of how long they had held their role.[24] Mr Kramel gave evidence that he does not recall why he phrased the email in the way that he did. Mr Kramel said that there was a lot going on at the time with plenty of back and forth between the bargaining representatives to finalise various clauses of the 2024 Agreement before it was put to a vote. Mr Kramel said that he certainly did not mean to suggest that the first level increase would be applied to the roles held by employees on 1 September 2024.[25]

[33] Following the access period, the voting period for the 2024 Agreement ran from 18 to 20 December 2024. 89% of employees who participated in the ballot voted to approve the 2024 Agreement.[26] On 3 January 2025, Ausgrid made an application to the Commission for the approval of the 2024 Agreement. The 2024 Agreement was approved by the Commission on 7 February 2025 and commenced operation on 14 February 2025.[27]

[34] Since the commencement of the 2024 Agreement, Ausgrid has taken the position that the first guaranteed level increase is based on employees' substantive position as at 1 September 2024, not 14 February 2025. According to the ETU, this has resulted in:

(a) new employees, who were employed in the period between 1 September 2024 and 14 February 2025, not receiving the benefit of the first guaranteed level increase and equivalent 2.08% increase (on average). These employees did not receive a one level increase (or $2,500 top of band payment) on commencement of the 2024 Agreement; and

(b) existing employees, who were promoted in the period between 1 September 2024 and 14 February 2025, not receiving the benefit of the first guaranteed level increase and equivalent 2.08% increase (on average). These employees did not receive a guaranteed level increase on commencement of the 2024 Agreement and only received back pay with respect to the period between 1 September 2024 and the date they were promoted, based on their position as at 1 September 2024.[28]

[35] Ms Koot gave evidence that the ETU has members that fall within both categories.[29]

[36] The ETU submitted that clause 20 of Appendix 4 of the 2024 Agreement is unambiguous. The emboldened words 'Commencement of Agreement' above the words 'Progression: 1 Level (single and multi band roles); or Top of Band $2,500' make clear that the first single level progression came into effect on 14 February 2025. It follows that the date of '1 September 2024' is the relevant back payment date for that single level progression.

[37] The ETU submitted that this construction is strengthened when clause 20 is read within the context of Appendix 4 as a whole. The ETU submitted that the first single level progression (and top of band payment) subject to this dispute occurred in accordance with the R&P Framework not the CCR. If the R&P Framework did not come into effect until the commencement of the 2024 Agreement, progression under that framework could not take place at an earlier date. If the first single level progression took effect at an earlier date, clause 1.3 of Appendix 4 and the emboldened words 'Commencement of Agreement' of Appendix 4 in clause 20 would have no work to do.

[38] The ETU submitted that other contextual aspects of the 2024 Agreement which support this construction of clause 20 of Appendix 4 include:

(a) clause 4 of Appendix 4, which states that the R&P Framework applies to all employees covered by the 2024 Agreement except for those employees in four defined categories (which are irrelevant for the purpose of the dispute). The only further carve outs in clause 20 of Appendix 4 relate to graduates. There is nothing in clause 20 which suggests that the first single level progression would not apply to new or recently promoted employees or that the clause would apply differently to those employees;

(b) the relevant 'back payment adjustment' date in clause 14.1 of the 2024 Agreement is 1 September 2024. This supports an interpretation of clause 20 of Appendix 4 such that the date '1 September 2024' is relevant in terms of back pay only.

[39] The ETU submitted that on a plain reading of the words, the first row of the first table in clause 20.1 in Appendix 4 must mean that the first single level progression came into effect on the 'Commencement of Agreement' with back payment for that single level progression to 1 September 2024.

[40] The ETU submitted that the above construction is supported by the industrial context in which the 2024 Agreement was made and operates. In the s.240 conferences, an agreement was reached which provided for a 13% increase to wages over 3 years. It is clear from the evidence that both parties viewed this figure of 13% as being supplemented or 'topped up' by the two 'guaranteed' single level progressions (or top of band payments) in clause 20 of Appendix 4.

[41] The ETU submitted that if the purpose of the two 'guaranteed' single level progressions in clause 20 of Appendix 4 was to bridge the gap between the ETU and Ausgrid's wages claim, it would not make sense to construe clause 20 of Appendix 4 such that only those employed as at September 2024 received the benefit of the first single level progression. Ausgrid's construction would mean that not all employees employed by Ausgrid at the commencement of the 2024 Agreement (and to whom clause 20.1 of Appendix 4 of the 2024 Agreement applied) would receive the benefit of the first single level progression.

[42] The ETU submitted that the obvious intent of the parties was to replace the CCR with the R&P Framework. The CCR was still in operation on 1 September 2024. It would not make sense for the first single level progression to take effect while the CCR was still in operation.

[43] Ausgrid contended that clause 20.1 of Appendix 4 provides for a straightforward and entirely conventional back pay arrangement - employees are to be put in the position that they would have been in had the agreement commenced operation on the date chosen by the parties, that is, 1 September 2024.

[44] Ausgrid submitted that the Commission's task in construing clause 20.1 of Appendix 4 of the Agreement, and thus answering the question for determination, is two-fold:

(a) to determine the ordinary meaning of the words used in the first row of the first table in clause 20.1; and

(b) if the meaning of clause 20.1 is ambiguous such that the ordinary meaning is not identifiable, to consider admissible extrinsic evidence as an aide to construing the provision.

[45] In relation to ordinary meaning, Ausgrid submits that when read left to right, the ordinary meaning of the first row of the first table in clause 20.1 of Appendix 4 to the Agreement is clear:

(a) the column on the left-hand side of the table, labelled 'Date', sets out the effective date for each of the events in that row of the table, that is, the date on which each event is to be assessed and back paid to, if required; and

(b) the column on the right-hand side, labelled 'Progression & Top of Band', sets out what events, being level progressions and top of band payments, will occur on the dates specified. The heading in bold and italics in each row of the table in the column on the right-hand side provides details as to when those progressions and payments will be implemented.

[46] Ausgrid submitted this ordinary meaning of clause 20.1 of Appendix 4 to the Agreement is supported by the purpose and industrial context of that clause. Ausgrid's construction of clause 20.1 is informed by the evident purpose and industrial context of the clause - that is, to put employees covered by the Agreement into the position they would have been in had the Agreement been in place and commenced its operation from 1 September 2024. That evident purpose confirms that the ordinary meaning of the clause is that which Ausgrid contends - that the events set out in the right-hand column of the first row of the table are to be assessed at and effective from 1 September 2024.

[47] Ausgrid submitted that the ETU's construction seeks to circumvent this evident purpose of clause 20.1 and put employees in a different, and better, position than they would have been in had the Agreement been in place from 1 September 2024. Further, the purpose that the ETU attempts to import into clause 20.1, that of 'bridg[ing] a gap between the ETU and Ausgrid's wages claim', is not aligned to the text and ordinary meaning of clause 20.1, nor is it supported by any evidence.

[48] Ausgrid submitted that the ETU's construction of clause 20.1 ignores the plain reading and purpose of the clause, as well as the surrounding context when clause 20 and the 2024 Agreement is read as a whole. Ausgrid submitted that the ETU's construction is misconceived for several reasons:

(a) firstly, there is no language in clause 20 of Appendix 4 to the Agreement to suggest that the dates given in the left-hand column of the first table only apply to back pay and not for the purposes of assessing level progression or top of band payments;

(b) secondly, on the ETU's construction of clause 20.1, the words that govern the timing of events in the right-hand column are the headings in bold and italics in the right-hand column itself. The corollary of that construction is that the dates in the lefthand column are left with no work to do in the second to fourth rows of the table, because those dates are the same as the timings that are bold and italicised in the right-hand column;

(c) thirdly, the date on which the Agreement commences is unknown and out of the parties' control, in that it depends entirely on when the Commission approves the Agreement. The date on which the Agreement commenced, being 14 February 2025, was neither in the contemplation of the parties at all when the in principle agreement was reached on 3 December 2024 nor when the Agreement was made on 20 December 2024. However, the ETU's construction attempts to imbue that date with additional meaning by suggesting that the parties' intention was for employees employed on or before 14 February 2025 to have benefits that those employed from 15 February 2025 would not be entitled to. There is no basis whatsoever to divine that intention from the text of clause 20;

(d) fourthly, the ETU's construction seeks to incorporate into clause 20.1 a distinction between the time at which back pay is to be paid, on the one hand, and the time at which the rate of pay to be used in making the payment is determined, on the other hand. In other words, a rate of pay at some unidentified time after 1 September 2024 can be used for the purposes of determining the amount of back pay to be paid on 1 September 2024. This distinction simply does not arise. There is only one date referenced in the clause. If the parties had intended to provide for events occurring after 1 September 2024 to influence the calculation of back pay, they would have used clear words to indicate this intention; and

(e) fifthly, the ETU's construction would see existing employees who were promoted between 1 September 2024 and 14 February 2025 receive back pay at the rate of one level above the level they were not yet appointed to as at 1 September 2024. This is inconsistent with the evident purpose of the clause, as outlined above. It is also inconsistent with clause 14.1 of the Agreement, which provides that "[e]mployees covered by this Agreement...are to be paid the appropriate wages or salary according to their appointed position" (emphasis added).

[49] Ausgrid noted that the ETU's suggestion that Ausgrid's construction means that the one level progression provided in the first row of the first table at clause 20.1 of the Agreement takes place on 1 September 2024, before the R&P Framework commenced operation. Ausgrid submitted that this is not its position. Ausgrid submitted that the one level progression takes place at the commencement of the Agreement, as specified in clause 20.1, but is given effect in terms of a back payment or top of band payment, by the language of clause 20.1, to 1 September 2024. There is no need for the machinery of the R&P Framework to be in place for this to occur; the progression is guaranteed and automatic and not dependent on the application of a process such as that found in the R&P Framework.

[50] Ausgrid submitted that for these reasons, the ordinary meaning of clause 20.1 can be ascertained on a plain reading of that clause. Ausgrid's construction of clause 20.1 in Appendix 4 of the Agreement, being that the first row of the first table in clause 20.1 provide employees with one level of progression based on the level that the employee held on 1 September 2024, aligns with the ordinary meaning and evident purpose of the clause. Accordingly, Ausgrid has met its obligations under clause 20.1 by making back payments so that the wage increase and one level progression were effective from 1 September 2024 and based on an employee's role as at 1 September 2024.

[51] Ausgrid submitted that in the alternative, if the Commission finds that the language of clause 20.1 of Appendix 4 to the Agreement is 'ambiguous or susceptible of more than one meaning', the Commission may have regard to extrinsic evidence that 'establish[es] objective background facts which were known to both parties'. Ausgrid submits that this evidence supports its construction of clause 20.1. Evidence of the 'objective background facts which were known to both parties' when the in-principle agreement was reached on 3 December 2024 is set out in the correspondence between the parties and in the joint statement that was issued to Ausgrid employees immediately following the conference, specifically:

(a) the document which Mr Hicks emailed to Mr Sweeting at 10:58am on 4 December 2024 that 'outlines the in-principle agreement reached last night in the FWC' and Mr Sweeting's amendments to that document;

(b) the joint statement that was mutually agreed by Ausgrid and the ETU and issued to employees on 4 December 2024; and

(c) the email chain between Mr Sweeting, Mr Kramel and Mr York on 10 December 2024.

[52] Ausgrid submitted that each of these documents indicate that the single level progression would be effective as of 1 September 2024. Nothing in these documents suggest that progression would be assessed on, or be effective from, the date the Agreement commenced operation.

[53] Ausgrid submitted that the correspondence outlined above also constitutes 'subsequent conduct' that is 'relevant to the interpretation of an industrial instrument', in accordance with Berri Principle 15, because it is 'post-agreement conduct' that 'show[s] that there [was] a meeting of minds, a consensus between the parties'. It is clear from this correspondence that the parties were proceeding on the basis that the Agreement was effectively made on 1 September 2024 and would apply from that date.

[54] Ausgrid submitted that its construction is also supported by the evidence that Mr Sweeting gives about the way in which the negotiations were conducted. Mr Sweeting says that Ausgrid had a budget envelope for the overall cost of the Agreement and that any in principle agreement needed to remain within that budget envelope. The position adopted by the ETU would have ratcheted up the cost of the in principle agreement. Mr Sweeting's evidence was that if the ETU had put its current position to Ausgrid, it would have rejected that position due to the additional cost involved.

[55] Ausgrid submitted that the authorities make it clear that the Commission's task in answering the question for determination is solely to apply the principles of enterprise agreement interpretation. Any consideration of the fairness, justice or merit of a particular construction of clause 20.1 would lead the Commission into error in performing its task. In this regard, the practical effect of Ausgrid's construction of clause 20.1 of Appendix 4 to the Agreement on certain cohorts of employees, being:

(a) existing employees, who were promoted in the period between 1 September 2024

(b) new employees, who were employed by Ausgrid in the period between 1 September

is irrelevant. The Commission should give effect to the words used in the Agreement, aided by the admissible extrinsic evidence should it find that the words are ambiguous or capable of more than one meaning.

[56] The principles in relation to the construction of enterprise agreements are well established. Enterprise agreements are to be construed as practical instruments that will apply to the working conditions known to employers and employees who work in the circumstances to which the instrument will apply.[30] The interpretation of an enterprise agreement begins with a consideration of the natural and ordinary meaning of its words. The words are to be read as a whole and in context. Ambiguity is to be resolved by a consideration of the history and subject matter of the award. Consideration of negotiations is of dubious assistance and evidence of the conduct of the parties subsequent to the making of the award cannot be used to construe it.[31]

[57] Narrow or pedantic approaches to interpretation should be avoided. The search is for the meaning intended by the framers of the document, bearing in mind that the framers were likely of a practical bent of mind. They may have been concerned with expressing an intention in ways understood in the context of the relevant industry or industrial relations environment. The document can be read to give effect to its purpose, having regard to the industrial context despite inconsistencies which might give rise to a different reading.[32] The main guides to construction are text, context and purpose and there is utility in bearing in mind the facts as they are known at the time the instrument is drafted.[33]

[58] The history of provisions of an industrial instrument may demonstrate that particular expressions have been the subject of interpretation by the courts or industrial tribunals, which may then be taken to have an accepted meaning when, in the same or a similar context, they find their way into later instruments. Context may shed light on the proper meaning to be given to expressions that take their colour from the industrial context.[34]

[59] However, it may not be appropriate for surrounding circumstances to be brought to account unless they rise to the level of matters that would be notorious or known to those intended to be bound by the instrument who did not participate in the negotiations or dealings by which the terms were formulated.[35]

[60] Enterprise bargaining will often involve a competition between disparate interests. The general objective of employees is to increase wages and improve entitlements while the general objective of the employer is to reduce or resist an increase in employment costs. Where the economic power of the bargaining parties is not equal, the resulting agreement may more likely reflect the inequality of bargaining strength than industrial fairness. Further, an enterprise agreement will likely reflect the compromises made in the bargaining process. An industrial bargaining process will not always produce an agreement where each entitlement provided will be either objectively reasonable or rational and in harmony with other entitlements, or based on some objectively discernible purpose that may have explained the reason for its adoption in a predecessor agreement made under a different bargaining process.[36]

[61] In AMA (Victoria) Ltd and Australian Salaried Medical Officers Federation v The Royal Women's Hospital[37] a Full Bench of the Commission distilled principles from the majority judgment of the Full Court of the Federal Court in James Cook University v Ridd[38] as follows:

The starting point is the ordinary meaning of the words, read as a whole and in context.

A purposive approach is preferred to a narrow or pedantic approach - the framers of such documents were likely to be of a practical bent of mind. The interpretation turns upon the language of the particular agreement, understood in the light of its industrial context and purpose.

Context is not confined to the words of the instrument surrounding the expression to be construed. It may extend to the entire document of which it is a part, or to other documents with which there is an association.

Context may include ideas that gave rise to an expression in a document from which it has been taken.

Recourse may be had to the history of a particular clause where the circumstances allow the court to conclude that a clause in an award is the product of a history, out of which it grew to be adopted in its present form.

A generous construction is preferred over a strictly literal approach but agreements should make sense according to the basic conventions of the English language.

Words are not to be interpreted in a vacuum divorced from industrial realities but in the light of the customs and working conditions of the particular industry.

[62] Clause 14 of the 2024 Agreement deals with wages and salaries. Clause 14.1 provides:

Employees covered by this Agreement as classified in Appendix 1A, 1B, 1C 1D, 1E and Appendix 4 are to be paid the appropriate wages or salary according to their appointed position as per Appendix 1 or Appendix 4. Wages and salaries under this agreement are shown in Appendix 1 and Appendix 4. They reflect the increases and dates of effect set out in the table below.

Employees will receive a back payment adjustment to 1 September 2024 and this will be paid within the first full pay cycle that occurs 7 business days following notification of approval of the Ausgrid Enterprise Agreement 2024 by the FWC.

[63] Appendix 1 does not appear to be relevant to the dispute before me as it refers to the following:

Appendix 1A - Ausgrid Professionals, Managers & Specialists Pay Rates

[64] Appendix 4 is headed 'Remuneration and Progression (RP) Framework' and attaches different pay rates tables for the Power Worker Stream, the Engineering Stream and the Functional Services Stream. Each of the tables have rates of pay from 1 September 2024, from 1 September 2025 and 1 September 2026.

[65] Clauses 1.1 - 1.3 of Appendix 4 explain that the R & P Framework is a broad-banded pay and classification structure to provide opportunity for career progression which comes into effect on commencement of the 2024 Agreement, in accordance with Clause 20 of Appendix 4, and replaces the previous CCR framework. Clause 1.6 explains that progression to Levels (pay levels) within a Band (single or multi banded) will occur each year unless the employee has underperformed pursuant to Clause 10.1 of Appendix 4.

[66] Clause 10 of Appendix 4 deals with the annual review and feedback cycle. Clause 10.2 provides that the review and feedback process is an annual cycle, based on the Financial Year from July 1 to 30 June. If it were not for clause 20 of Appendix 4, the feedback cycles during the nominal term of the 2024 Agreement would be from 1 July 2024-30 June 2025, 1 July 2025-30 June 2026, and 1 July 2026-30 June 2027. Clause 10.3 provides that following the conclusion of the annual review and feedback cycle, employees will receive notification of their outcome which will include eligibility for progression.

[67] Under clause 11.1 of Appendix 4, progression to a higher Level in a Band is based on the employee's annual overall outcome. As noted above, clauses 11.2.1 and 11.2.2 provide that an employee will move one level in their band if they have completed at least 6 months of the annual review and feedback cycle at their existing level of that Band and they have not underperformed in their current Role. Clause 11.2.3 provides that subject to Clause 12 of Appendix 4, (which deals with Merit and Streamlined Promotion to a higher Band) an employee can only move one level in any one annual review cycle.

[68] Clause 19 provides that employees are eligible for a 'Top of Band' Recognition Incentive Payment of $2,500, if they have satisfied requirements of the annual review and feedback cycle, been at the highest Level within their respective Band, for the 12 month period prior to 30 June and are not eligible to progress to another Band or eligible for progression due to salary maintenance or grandparenting arrangements.

[69] Clauses 11.1 and 19 are modified by clause 20 of Appendix 4. If clause 20 did not apply, employees would complete an annual review and feedback cycle for the financial years ending 30 June 2025 and 30 June 2026 and employees would be eligible to progress one level on 1 July 2025 and again on 1 July 2026. The effect of clause 20 is that employees progress one level on the date that the 2024 Agreement commences (although the date that this takes effect is in dispute) and on 1 July 2025 but do not progress on 1 July 2026. The initial level increase at commencement of the 2024 Agreement is not referable to an annual review and feedback cycle as the cycle for the financial years ending 30 June 2024 is covered by the 2021 Agreement.

[70] Clause 20 does not apply to the annual review and feedback cycle for the financial year ending 30 June 2027, so employees are required to satisfy the requirements of 11.1 and 19 to be eligible for progression or a 'Top of Band' Recognition Incentive Payment of $2,500 on 1 July 2027.

[71] It is helpful to consider the practical implications of the parties' respective positions by reference to circumstances of Mr Ryan Pike, who gave evidence in the proceedings. Although Ausgrid submits that these considerations are not relevant to determining the matter before me, it assists in considering the ETU's submissions that nothing in clause 20 suggests that the first single level progression would not apply to new or recently promoted employees or that the clause would apply differently to those employees. Further it gives contexts to the purpose of clause 20.1 in creating an exception to the usual way that progression occurs under clause 11.2.

[72] Mr Pike works as an Engineering Officer for Ausgrid and is a member of the ETU.[39] On 21 October 2024, Mr Pike was appointed to a Band D2 Level 1 position. Prior to this, Mr Pike was classified at Band D1 Level 4.[40]

[73] Mr Pike explained that he was appointed to Band D2 in accordance with the CCR under the 2021 Agreement. A Band D2 role became vacant within his depot due to a resignation within the business. Mr Pike applied for the role and was required to participate in a selection process which involved being short listed and attending an interview. Mr Pike was selected for the Band D2 role based on merit and following the completion of an advanced diploma of electrical engineering which he commenced in 2023.[41]

[74] Prior to the commencement of the 2024 Agreement, Mr Pike received $130,242 from 1 September 2024 in the Band D1 Level 4 role. On 21 October 2024, when appointed to Band D2 Level 1, Mr Pike's salary was $135,140.

[75] If there was no clause 20 appendix 4, the effect of the 2024 Agreement is that Mr Pike would have received a 7% increase to his Band D1 Level 4 salary after the Agreement commenced, backdated to 1 September 2024 for the period from 1 September 2024 to 20 October 2024. This amount is $139,795. Mr Pike would have also received a 7% increase to his Band D2 Level 1 salary backdated to the date of appointment to that position being 20 October 2024. This amount is $145,036.

[76] Assuming that there are no performance issues, under clause 11.2, Mr Pike would have been eligible to progress to Band D2 Level 2 on 1 July 2025, to Band D2 Level 3 on 1 July 2026 and to Band D2 Level 4 on 1 July 2027.

[77] Under Ausgrid's interpretation of Clause 20 appendix 4, Mr Pike would progress to Band D2 Level 2 on 1 July 2025 but would stay at that grade for two years. Under the ETU's interpretation, Mr Pike would be appointed to Band D2 Level 2 on commencement of the Agreement but back paid to 1 September 2024 then appointed to Band D2 Level 3 on 1 July 2025. Mr Pike is worse off under Ausgrid's interpretation of clause 20 compared to if 11.2 applied. The following table shows Mr Pike' s entitlements under these various scenarios:

Clause 20 Appendix 4 does not apply to the FY27 annual review & feedback cycle

[78] The table above also accurately describes the different scenarios which would apply if Mr Pike was a new employee who commenced employment in a D2 Level 1 position on 21 October 2024 (however the horizontal row which commences '1 September 2024' would not apply if clause 11 applies or to Ausgrid's position).

[79] An employee whose classification did not change during the period from 1 September 2024 to 13 February 2025 is better off under Ausgrid's interpretation compared to if 11.2 applied. The following table shows under various scenarios if Mr Pike was appointed to the D2 Level 1 role seven weeks earlier on 1 September 2024.

Clause 20 Appendix 4 does not apply to the FY27 annual review & feedback cycle

[80] The table in Clause 20.1 comprises of two columns, the first with a heading 'Date' and the second with a heading 'Progression & Top of Band'. Putting to one side the first row commencing 1 September 2024, which is the subject of the dispute, each of the other three rows refer to dates which correspond with the words in bold italics in the second column. '1 July 2025' is the day after the conclusion of the 'FY25 Annual Review and Feedback Cycle' which would ordinarily run from 1 July 2024-30 June 2025 and '1 July 2026' is the day after the conclusion of the 'FY26 Annual Review and Feedback Cycle' which would ordinarily run from 1 July 2025-30 June 2026. As clause 11.2 of the 2024 Agreement is excluded from the operation of clause 20, there is no annual review and feedback cycle for the 2025 financial year and the 2026 financial year, with employees receiving a level increase on 1 July 2025 and no level increase on 1 July 2026.

[81] The language is different with respect to the last date to reflect that there will be a feedback cycle from 1 July 2026 to 30 June 2027 for the 2027 financial year and that clause 20 will not apply. The consequence of this is that clauses 11.2 and 19 will apply rather than Clause 20.

[82] Turning back to the first row, the date in the first column does not correspond with the words in bold italics in the second column, in that 1 September 2024 is not the 'Commencement of Agreement'. However, the parties agree the words below 'Commencement of Agreement' reflect what was required to occur at that time, namely, progression by one level or a payment of $2,500 if the person is at the top of their band. The issue which arises is the meaning of '1 September 2024' and whether:

it refers to the date from which an employee should be paid the level they are appointed to at commencement of the 2024 Agreement; or
it refers to the date that the first 'one level' progression takes effect.

[83] If '1 September 2024' refers to the date that the first one level progression takes effect, this results in only employees covered by the 2024 Agreement who were employed on 1 September 2024 receiving the first one level progression. However, there is nothing in the text of the document which provides that such employees are excluded from this entitlement. In the original version of the 2024 Agreement which was circulated to the bargaining representatives by Ausgrid on 6 December 2024, such employees were excluded from the first level progression because clause 11.2.1, which required employees to have completed at least 6 months of the annual review and feedback cycle at their existing level of their Band applied to clause 20. Similarly, employees such as Mr Pike who were promoted during this time, were also excluded. However, following the email exchange between Mr Kramel and Mr York, clause 20 was amended to exclude Clause 11.2 in its entirety so clause 11.2.1 no longer applied. It does not matter that Mr York said in his email to Mr Kramel that the reason that clause 11.2.1 initially applied to clause 20 was to exclude employees who commenced employment after the approval of the Agreement from the July 2025 one level progression. Once clause 11.2.1 no longer applied to clause 20, there is no specific provision which excludes certain employees from the first level increase, therefore the reference to '1 September 2024' needs to be read in that context.

[84] Further context which is relevant to the construction of clause 20.1 is the interaction between clause 11.2 and clause 20. Clause 11.2 is more beneficial to employees than the corresponding clause in the 2021 Agreement. The requirement that an employee not underperform in their current role in clause 11.2.2 is another way of saying that an employee either 'Meets Expectations' or 'Exceeds Expectations', which was the language used in Appendix 4 of the 2021 Agreement. Under clause 11.2 of the 2024 Agreement an employee can progress beyond level 2 of their Band if they simply 'Meet Expectations', whereas this was not available under the 2021 Agreement which required an employee to 'Exceed Expectations' to progress beyond this level. Clause 20 appears to provide an additional benefit. Under clause 11, an employee would be entitled to progress one level each year during the term of the 2024 Agreement on 1 July 2025, 1 July 2026 and 1 July 2027 if there are no performance issues. Clause 20 does not provide for level progression on 1 July 2026 but provides for it to occur on commencement of the 2024 Agreement. In his email to Mr York, Mr Kramel said that 'it stands to reason' that 'the Sept 24 level increase or bonus is being brought forward from [the 25/26 cycle].' Although Mr Sweeting disputed during the hearing that the first level increase was the 1 July 2026 increase 'brought forward,' he said,

In the s.240 conference, there was a proposition put forward for four progression points across the three years. And in consideration of that, we ran that through our models and valued that, and realised that that was unaffordable. So when we went back to the table to negotiate an outcome, we said we couldn't afford four progression points and we could only afford three. So the decision was taken around the table to take out the one in 2026. It was never intended that we were bringing 2026 forward. It was always we will take one progression point out, and that was the one that we decided, which was obviously - would cost Ausgrid more money, because we were giving people a progression point at the beginning.[42]

[85] I understand from Mr Sweeting's evidence that one of the purposes of clause 20 in 'giving people a progression point at the beginning' was to provide employees with a benefit, namely two consecutive level increases at an earlier stage than provided by clause 11. In many ways this is self-evident from the timing of the level progressions in clause 20 compared to clause 11. However, on Ausgrid's construction of clause 20, employees who were not employed or were promoted during the period from 1 September 2024 to 14 February 2025 are worse off than if clause 11 applied. In my view, clause 20 should be construed in a way that gives effect to its purpose to be more beneficial to employees than clause 11 in relation to level progression, which favours the ETU's construction of the clause.

[86] In addition to clause 20 of Appendix 4, '1 September 2024' is also referred to in numerous provisions of the 2024 Agreement, including the pay rates tables and clause 14.1. In these provisions, 1 September 2024 is generally the date that new pay rates, superannuation and allowances take effect from. However, 1 September 2024 is also referred to in Clause 14.1 in the context of a back payment adjustment. Clause 14.1 states that 'Employees covered by this Agreement as classified in....Appendix 4 ...are to be paid the appropriate wages or salary according to their appointed position as per....Appendix 4.' In clause 20 of Appendix 4, employees are to progress by one level upon 'Commencement of Agreement' which is the employee's 'appointed position' as provided by clause 14.1. The employee then 'receive[s] a backpay adjustment to 1 September 2024 [which] will be paid within the first full pay cycle that occurs 7 business days following notification of approval of the Ausgrid Enterprise Agreement 2024 by the FWC.' In my view, when clause 14.1 and clause 20 of Appendix 4 are read together, this favours the construction advanced by the ETU that '1 September 2024' refers to the date which an employee should be paid the level they are appointed to at commencement of the 2024 Agreement. However, I do not accept that an employee who commenced employment or was promoted after 1 September 2024 is entitled to receive backpay to 1 September 2024.

[87] Putting aside the issue of progression, an employee who was employed prior to 1 September 2024 would expect to receive a 'backpay adjustment' to their wages covering the whole period of their employment from 1 September 2024 to February 2025. If an employee commenced employment after 1 September 2024, they would expect to receive a 'backpay adjustment' from commencement of employment to February 2025. Such an employee would not receive a backpay adjustment to 1 September 2024 in respect of a period that they are not employed despite the language in clause 14.1 suggesting that this could occur. Similarly, an employee who was promoted after 1 September 2024 would not receive a backpay adjustment to 1 September 2024 in respect of the classification for the new position but only up to the date that they were promoted to the position. The 'backpay adjustment' for the former position would be made at the classification of the former position from 1 September 2024 to the date that the employee was promoted.

[88] In my view, the 'backpay adjustment' in clause 14.1 applies to an employee's 'appointed position' which is referable to the one level progression in clause 20. In the same way that the 'backpay adjustment' for wages ordinarily applies to employees for the duration of their employment, I do not accept the ETU's contention that an employee who commences employment after 1 September 2024 is entitled to receive backpay to 1 September 2024. That employee should receive backpay for the level one progression only to the date that they commenced employment with Ausgrid. Similarly, a person who was promoted after 1 September 2024 and received a one level progression based upon the classification of their new position should only receive backpay for the level one progression to the date that they were appointed to the position from which the one level progression in made. This approach is consistent with the way that backpay adjustments are usually made with respect to wages in industrial instruments.

[89] Having regard to the ordinary meaning of the words in clause 20 of Appendix 4 read as a whole and in context I have determined that employees are entitled to one level of progression based on the level that the employee held on the commencement of the 2024 Agreement. In reaching this conclusion, I have had regard to the following:

There is nothing in the text of the document which provides that employees who were employed after 1 September 2024 are excluded from this entitlement;
This construction gives effect to the purpose of clause 20 to be more beneficial to employees than clause 11 in relation to level progression; and
When clause 14.1 and clause 20 of Appendix 4 are read together, this favours a construction of clause 20 that '1 September 2024' refers to the date which an employee should be paid the level they are appointed to at commencement of the 2024 Agreement.

[90] In relation to the parties' agreed question for determination, I have determined that the first row of the first table in clause 20.1 in Appendix 4 of the 2024 Agreement provides employees with one level of progression based on the level that the employee held on the commencement of the Agreement (14 February 2025). However, for the reasons stated, I believe that employees who commenced employment or were promoted after 1 September 2024 are entitled to a backpay adjustment in respect of the level progression from the date or commencement of employment or promotion.

Ms Emily Strachan, Senior Legal Officer for the Applicant

Mr Stephen Crilly, Counsel from Seyfarth Shaw for the Respondent

[1] Statement of Tara Koot dated 27 May 2025 (Koot Statement) [4]

[2] Witness Statement of Matthew Sweeting dated 4 June 2025 (Sweeting Statement) [9]

[25] Statement of Peter Kramel dated 6 June 2025 [13]

[30] Sheehan v Thiess Pty Ltd [2019] FCA 1762, [20]

[31] City of Wanneroo v Holmes [1989] FCA 369; (1989) 30 IR 362 at [379]

[32] Kucks v CSR (1996) 66 IR 182, 184; Transport Workers' Union of Australia v Coles Supermarkets Australia Pty Ltd [2014] FCAFC 148; (2014) 245 IR 449

[33] Amcor Ltd v Construction, Forestry, Mining and Energy Union [2005] HCA 10; (2005) 222 CLR 241; 138 IR 286 at [2] per Gleeson CJ and McHugh J; at [30] per Gummow, Hayne and Heydon JJ; at [64] and [96] per Kirby J; at [129]-[131] per Callinan J

[34] King v Melbourne Vicentre Swimming Club Inc [2020] FCA 1173 at [127]

[35] Sheehan v Thiess Pty Ltd [2019] FCA 1762 at [22]

[36] Target Australia Pty Ltd v SDA [2023] FCAFC 66; (2023) 324 IR 304 at [54], [55]

[38] [2020] FCAFC 123, 298 IR 50 at [65] per Griffiths and SC Derrington JJ at [65].

[39] Statement of Ryan Pike dated 27 May 2025 [1]

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Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Ausgrid Management Pty Ltd Trading AS Ausgrid [2025] FWC 1896

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Judgment (167 paragraphs)

Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Ausgrid Management Pty Ltd Trading AS Ausgrid [2025] FWC 1896 (2 July 2025)

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Legislation Cited (1)

Cases Cited (5)