consideration
13 It is convenient to consider together the two questions of law identified above.
14 HBF contended that the HBF Scheme does not involve discrimination at all and therefore does not involve 'improper discrimination' within the meaning of the Act. This contention was based on the proposition that discrimination generally involves the inappropriate and unequal treatment of equals which is not adapted to the attainment of proper objectives. Further, HBF contended that 'discrimination' in the definition of 'improper discrimination' involves only discrimination against a person and not discrimination between persons.
15 The above contentions are untenable and inconsistent with the authorities concerning the proper interpretation of anti-discrimination legislation.
16 The Act does not contain a definition of the word 'discriminate' in any of its grammatical forms. In its usual or ordinary meaning 'discriminate' does not necessarily carry a pejorative connotation; it simply means to make a distinction between persons or things. For example, it is generally regarded as appropriate for a school principal to discriminate in the level of after‑school care and supervision provided for infants and adolescents respectively. A description of a person as 'discriminating' is generally understood as a positive statement about that person. There is, in our view, no reason to think that the word 'discrimination' is not used in s 66(1) of the Act in its ordinary sense to mean the making of distinctions - relevantly between persons.
17 There is now considerable anti‑discrimination legislation in Australia. For example, the Racial Discrimination Act 1975 (Cth) ('the RDA') by s 15 renders it unlawful for employers to make distinctions based on race, colour or national or ethnic origin in determining who should be offered employment. Although s 15 of the RDA does not use the words 'discriminate' or 'discrimination' it is, as the title of the Act recognises, a provision which proscribes discrimination on the grounds identified in the section. Similarly, the Sex Discrimination Act 1984 (Cth) ('the SDA') by s 14(1) renders it unlawful for employers to make distinctions based on, among other things, sex or marital status in determining who should be offered employment. Section 14(1) of the SDA expressly proscribes 'discrimination against'a person on the grounds of sex or marital status.
18 The authorities, including Waters v Public Transport Corporation (1991) 173 CLR 349 ('Waters'), make it clear that the effect of s 15 of the RDA and s 14(1) of the SDA is to deem race, colour, national or ethnic origin, sex and marital status to be irrelevant to an employer's decision as to who should be offered employment. The employer is, of course, still entitled to choose one candidate over another and in this sense to discriminate between candidates. However, the employer's choice between candidates must be based on grounds that have not been deemed by statute to be irrelevant to that choice. That is, the choice must be made by reference to grounds other than race, colour, national or ethnic origin, sex or marital status. The legislature has, to the extent of its constitutional power, rendered it unlawful for an employer to discriminate againsta person on any of these grounds when choosing an employee.
19 In Waters at 363 Mason CJ and Gaudron J suggested that anti‑discrimination legislation was concerned with discrimination against, rather than discrimination between, persons with different characteristics. Their Honours said that the notion of 'discrimination against' involves differentiation by reason of irrelevant or impermissible considerations. This view was not expressed by any other member of the High Court in Waters. If their Honours intended to convey that discrimination 'between' persons involves the drawing of distinctions on legitimate grounds while discrimination 'against' persons implies the drawing of distinctions on irrelevant or illegitimate grounds, the suggested linguistic convention is not, we suggest, uniformly followed (see, for example, the language adopted by Dawson and Toohey JJ in Waters at 392).
20 More importantly, nothing in Waters, or any other relevant authority, suggests that it is permissible to discriminate between persons on a ground proscribed by legislation as a ground of discrimination because a legitimate reason for drawing a distinction between persons on that ground can be identified. The proposition advanced by HBF (see [14] above) that discrimination generally involves the inappropriate and unequal treatment of equals that is not adapted to the attainment of proper objectives appears to derive from authorities in which the notion of 'discrimination' as manifest in the text and interpretation of the Constitution has been considered (see, for example, Street v Queensland Bar Association (1989) 168 CLR 461 at 570-571; Austin v Commonwealth (2003) 215 CLR 185 and Permanent Trustee Australia Ltd v Commissioner of State Revenue (2004) 211 ALR 18 at [88]-[94]). These authorities are of limited assistance in determining the proper construction of the definition of 'improper discrimination' in s 66(1) of the Act. This is because that definition explicitly refers to discrimination that is related to particular matters; that is, in the more traditional language of anti-discrimination legislation, to discrimination on the grounds identified in the subparagraphs of the definition. The terms of the definition of 'improper discrimination' leave no room for any evaluation of whether a distinction on any of the identified grounds is adapted to the attainment of a proper objective.
21 The submissions of HBF identified in [14] above were in part founded on a misunderstanding of certain observations contained in the joint judgment of Gaudron, Gummow and Callinan JJ in Cameron v The Queen (2002) 209 CLR 339 at [15]. The High Court in Cameron v The Queen was concerned with principles of sentencing. One such principle is that a convicted person may not be penalised by way of increased sentence for having insisted on his or her right to trial (Siganto v The Queen (1998) 194 CLR 656 at [22]).
22 The observations from the joint judgment in Cameron v The Queen upon which HBF placed reliance can only be understood if they are read in the context provided by the preceding paragraph (ie [14]). The relevant passage is thus:
'Reconciliation of the requirement that a person not be penalised for pleading not guilty with the rule that a plea of guilty may be taken into account in mitigation requires that the rationale for that rule, so far as it depends on factors other than remorse and acceptance of responsibility, be expressed in terms of willingness to facilitate the course of justice and not on the basis that the plea has saved the community the expense of a contested hearing.
… One aspect of the legal notion of discrimination "lies in the unequal treatment of equals". The "equals" here are those required to plead guilty or not guilty; they stand as equals before the criminal law and processes of Western Australia. But is the differential treatment of such persons and the unequal outcome with respect to sentence the product of a distinction which is appropriate and adapted to the attainment of a proper objective, here the facilitation of the course of justice by the willingness of the accused to plead in a particular fashion? The answer … is in the affirmative.' (citation omitted)
23 As their Honours concluded in the above passage, no principle of sentencing proscribes the drawing of a distinction for sentencing purposes between accused persons who facilitate the course of justice by pleading guilty and those who do not so facilitate the course of justice. As the facilitation of the course of justice is a proper sentencing objective, and as mitigation of sentence for those who plead guilty is appropriate and adapted to achieve that objective, the differential treatment involved in mitigating the sentences of those who plead guilty, while not mitigating the sentences of those who plead not guilty, is permissible - albeit that it would be impermissible to increase the sentences of those who plead not guilty because they have insisted on their right to trial.
24 Nothing said by Gaudron, Gummow and Callinan JJ in Cameron v The Queen provides support for the contention that the unequal treatment of equals can only involve discrimination when it is not the product of a distinction which is appropriate and adapted to the attainment of a proper objective. Where the law proscribes discrimination on a particular ground, consideration of whether discrimination on that ground might be in the public interest is, as their Honours recognised, foreclosed.
25 Another authority on which HBF placed reliance was Bayside City Council v Telstra Corporation Limited (2004) 216 CLR 595 ('Bayside'). That case concerned the application of clause 44(1)(a) of Schedule 3 of the Telecommunications Act 1997 (Cth) which provides that a law of a State or Territory has no effect to the extent that it discriminates against a particular carrier. That is, the legislation in question was not concerned to proscribe discrimination on particular grounds but rather to render ineffective laws which discriminated generally against a particular carrier. In this sense the legislation under consideration was comparable to provisions such as s 117 of the Constitution. It was in that context that Gleeson CJ, Gummow, Kirby, Hayne and Heydon JJ at [40] said:
'Discrimination is a concept that arises for consideration in a variety of constitutional and legislative contexts. It involves a comparison, and, where a certain kind of differential treatment is put forward as the basis of a claim of discrimination, it may require an examination of the relevance, appropriateness, or permissibility of some distinction by reference to which such treatment occurs, or by reference to which it is sought to be explained or justified. In the selection of comparable cases, and in forming a view as to the relevance, appropriateness, or permissibility of a distinction, a judgment may be influenced strongly by the particular context in which the issue arises. Questions of degree may be involved.' (citation omitted)
26 Section 66(1) of the Act (see [9] above), in contrast to the legislation considered in Bayside, is concerned with discrimination on particular grounds. It characterises as 'improper discrimination' any discrimination that is related to the age of a person and any discrimination that is related to the amount, or extent, of the benefits to which a person becomes, or has become, entitled during a period. Consequently, any rules of a registered organisation which permit the organisation to discriminate against a person on the basis of his or her age (whether it be a young or an old age) or on the basis of the amount, or extent, of the benefits to which the person becomes, or has become, entitled during a period will not be consistent with the principles of community rating (see s 73AAH(2)). Section 73AAH(1) (see [8] above) requires the rules of a registered organisation to be consistent with the principles of community rating.
27 The Tribunal, in our view, rightly rejected the submission that s 73AAJ of the Act discloses an intention to modify the operation of s 73AAH(1) in respect of ancillary health benefits. Section 73AAJ is concerned to proscribe 'improper discrimination' in certain classes of decisions made by registered organisations. Decisions concerning ancillary benefits do not fall within the terms of s 73AAJ. However, this does not, in our view, give rise to an implication that decisions of registered organisations concerning ancillary benefits are not required to be consistent with the principles of community rating. Indeed s 73AAH(4) makes clear that, generally speaking, decisions concerning ancillary health benefits must be consistent with the principles of community rating. Section 73AAH(4) effectively deems limitations on entitlements to ancillary health benefits in respect of a period by reference solely to the quantum of ancillary health benefits already claimed in respect of that period to be consistent with the principles of community rating. If decisions concerning ancillary health benefits were not otherwise required to be consistent with the principles of community rating s 73AAH(4) would be unnecessary.
28 The effect of the provisions of the Act concerning principles of community rating is to require the rules of registered organisations to attach no significance to the age of a person - except to the extent authorised by s 66(1)(ba). Similarly, the principles of community rating require that, subject to s 73AAH(4), no significance is to be attached to the amount, or extent, of the benefits to which a person becomes, or has become, entitled during a period.
29 Paragraph (mb) of Schedule 1 of the Act renders it impermissible for a registered organisation, in determining whether a contributor or a dependent of a contributor may participate in a loyalty bonus scheme, to have regard to the age of the contributor or the dependent or the amount, or extent, of the benefits to which the contributor becomes, or has become entitled during a period. Age and benefit entitlements are deemed by paragraph (mb) of Schedule 1 to be irrelevant to participation in a loyalty benefit scheme.
30 Provisions of a loyalty benefits scheme which require a contributor to attain the age of 65 years before he or she can utilise the financial benefits offered by the scheme attach significance to the person's age. Any rules of a registered organisation which seek to implement such provisions will therefore contravene s 73AAH of the Act. A registered organisation which determines whether a contributor or a dependent of a contributor may participate in a loyalty benefit scheme by reference to the age of the contributor or dependent will contravene paragraph (mb) of Schedule 1 of the Act.
31 The same analysis applies to provisions of a loyalty benefits scheme which attach significance to the level of claims made for ancillary benefits by a contributor over a three year rolling period. Such provisions will give rise to discrimination that is related to 'the amount, or extent, of the benefits to which a person becomes, or has become, entitled during a period' within the meaning of s 66(1) of the Act. They will not fall within the protection of s 73AAH(4).
32 It is not necessary for the purpose of answering the questions of law which may be understood to constitute the subject matter of this appeal to give consideration to the numerous arguments advanced by HBF in support of the contention that the HBF Scheme is consistent with the policy objectives of the Act. The Act by, amongst other provisions, s 66(1), s 73AAH and paragraph (mb) of Schedule 1, discloses a clear intention that a registered organisation may not operate a loyalty benefit scheme that discriminates against a contributor by reason of his or her age or the amount, or extent, of the benefits to which he or she becomes, or has become, entitled during a period. It is not open to a registered organisation to argue that its particular loyalty benefit scheme, whilst discriminating in the above ways, is not proscribed by the Act because it will advance certain other policy objectives of the Act. The Act has foreclosed any such argument.