Julia Thornthwaite v Australian National Credit Union Ltd

Constitution s 109 LEGISLATION CITED : Conciliation and Arbitration Act 1904 (Cth) s 252 Industrial Relations Act 1996 s 106 Workplace Relations Act 1996 s 152 s 170LZ s 170LCM Ansett Transport Industries (Operations) Pty Ltd v Wardley (1978 - 1979) 142 CLR 237 Australian Broadcasting Commission v Industrial Court (SA) (1977) 138 CLR 339 Barclays Australia Investments Services Ltd v Nordby (1995) 99 IR 258 at 279 Barry v Australian Broadcasting Commission [2002] NSWIRComm 14 at [26] Beahan v Bush Boake Allen Australia Ltd (1999) 47 NSWLR 648 Blackley v Devondale Cream (Vic) Pty Ltd (1967-68) 117 CLR 253 Burgess v Mount Thorley Operations Pty Ltd [2002] NSWIRComm 106 Byrne v Australian Airlines Ltd (1995) 185 CLR 410 Casey v Wentworthville Memorial RSL Club (1986) 16 IR 337 Davies v General Transport Development Pty Ltd [1967] AR NSW 371 at 374 Dawson v Telstra Corp. Ltd (1998) 44 AILR 5-176 Ex parte McLean (1930) 43 CLR 427 at 483 Felman v Law Institute of Victoria (1997) 142 FLR 362 at 381 Garde v WorkCover Authority of New South Wales (1993) AILR 79 Harrison v Australian Meat and Livestock Corporation (1994) AILR 174 Health and Research Employees' Association of Australia (NSW) v Youth and Community Services (1986) AILR 408 Hudson v Qantas Airways Ltd (1985) 10 IR 331 Huskisson RSL Sub Branch Club Ltd v Sullivan (1990) 32 IR 404 CASES CITED : Hussman v Walker (1993) 31 NSWLR 189 ICI Australia Operations Pty Ltd (t/as Dulux Australia) v Hutton (1993) 47 IR 288 Incitec Ltd and anor v Berry & ors (1992) 29 NSWLR 83 J Green and Courtesy Real Estate Pty Ltd (1981) AILR 65 Kanan v APTU (1991) AILR 46) Majik Markets v Brake Services Centre Drummoyne Pty Ltd & ors (1992) 28 NSWLR 443 Metal Trades Industry Association of Australia v Amalgamated Metal Workers and Shipwrights' Union (1983) 152 CLR 632 at 641 and 648 Metrocall Inc v Electronic Tracking Systems Pty Ltd (2000) 101 IR 66 at 76-7 Mt Thorley Operations Pty Ltd v Burgess & ors (2001) 103 IR 184 Nagle v Tilburg & anor (1993) 51 IR 8 Renard Constructions (ME) Pty Ltd v Minister for Public Works (1992) 26 NSWLR 234 Sharkey v MWSBB (1981) AILR 297 State of New South Wales v Health and Research Employees Association of NSW (unreported, Fisher CJ, Bauer & Hill JJ, 31 March 1993 Stevenson v Barnham (1977) 136 CLR 190 at 192 T.A. Robinson & Sons Pty Ltd v Haylor (1957) 97 CLR 177 Telstra Corp Ltd v Worthing (1999) 197 CLR 61 Virtue v New South Wales Department of Education and Training (1999) 92 IR 428 Westfield Holdings v Adams (2001) NSWIRComm 293

HEARING DATES: 08/14/2002 DATE OF JUDGMENT: 09/17/2002

APPLICANT: Mr J de Meyrick of counsel SOLICITORS: Mr D Alder Lincoln Smith and Company LEGAL REPRESENTATIVES:

RESPONDENT: Mr John Fernon of counsel SOLICITORS: Mr E Haggerty Toomey Pegg Drevikovsky

JUDGMENT: - 55 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION

17 September 2002 Matter No. IRC 2391 of 2002 JULIA THORNTHWAITE v AUSTRALIAN NATIONAL CREDIT UNION LTD Application under s 106 of the Industrial Relations Act 1996 JUDGMENT [2002] NSWIRComm 240 1 In April 2002, the applicant filed a summons for relief under s 106 of the Industrial Relations Act 1996 seeking certain orders arising from the termination of her employment by the respondent. The respondent company was the result of a merger which occurred after the applicant says that she was effectively headhunted out of secure public service employment to take up a position in the predecessor credit union. She alleges that representations were made to her that her job would be permanent even if the merger, which was then a possibility, was to take place. Amongst the orders sought was, by way of variation of the contract, the provision of 12 months' notice of termination or payment in lieu; retrenchment benefits on the basis of six weeks' pay per year of service, outplacement service for a period of six months and financial counselling; the payment of annual leave, long service leave, superannuation and other statutory or contractual entitlements for the period of notice and the payment of all of these amounts on the total remuneration package.

2 The summons contained the following paragraph: There is no award, agreement or determination by reference to which this claim or any part of it is based, although the contract or arrangement which the application seeks to have varied or voided as the Commission considers just, bears in some respect a reference to the Endeavour Credit Union Enterprise Agreement 1997 and the Credit Union Award 1998

3 In the section of the summons dealing with the facts alleged it was stated the applicant commenced employment with the respondent on 5 June 2000 and that the merger did take place in January 2001. The summons then explains in some detail the circumstances of the respondent following the merger and the various roles given to the applicant in the newly structured organisation. At one point, the applicant deals with her role in organising staff training nights in May 2001 and in dealing with a problem which had arisen in arranging for staff to attend, and noted that staff in Melbourne were required in their enterprise agreement with Advantage Credit Union (which was said to be still current) to attend information nights without pay while staff in Sydney had never had an information night and were not required to attend under the terms of the Endeavour Credit Union Enterprise Agreement. It is in this context that the enterprise agreements were mentioned. On 5 July 2001, the applicant was told that she had been made redundant effective immediately. On the hearing of the respondent's notice of motion, it was common ground that the applicant had been given payments on account of redundancy and severance calculated in accordance with the relevant enterprise agreement.

4 The summons for relief also made it clear that a significant part of the applicant's case was the employer's alleged misleading and deceptive conduct with references being made to not only the law as to misrepresentation in s 106 cases but also to provisions of the Fair Trading Act (NSW) and the Trade Practices Act (Commonwealth).

5 The summons had annexed to it the offer of employment made by the pre-merger entity. The letter of offer set out the position, the location of the work, the grade of the position and the fact that it would be full time employment. It specified a gross salary per annum and provided for 20 days' annual leave at the completion of each 12 months of continuous service, made provision for eight days' sick leave, nominated the person to whom the applicant would report and required a probationary period of three months. The letter of offer also set out a brief description of the duties, the fact that there would be a confidentiality undertaking required, that the applicant would be required to sign a document agreeing to comply with the policy of maintaining a smoke-free workplace and that there was a no conflict of interest provision such that any private activity was not to conflict with the interests of the credit union. There was a mobility clause entitling the employer to transfer the applicant at any time to any branch or department on a temporary or permanent basis, the provision of superannuation under a specified superannuation plan, a prohibition on working for any other credit union, a prohibition on dealing with the media and a provision that, although the nature and role of the applicant and her responsibilities may be significantly varied throughout the period of service, nevertheless, the terms and conditions set out in the letter of offer would continue to apply as contractual provisions unless otherwise amended in writing. The letter of offer also noted that the position of employment was an "exempt position under Clause 6 of the Endeavour Credit Union Enterprise Agreement 1997". It was further provided that: "all other terms and conditions of employment will be covered by the Endeavour Credit Union, Enterprise Agreement, 1997 and the Credit Union Award, 1998". The letter of offer required a signed acknowledgement of the terms and conditions of employment. It appears that the applicant signed that acknowledgment on 15 May 2000. Of importance for the purpose of the present debate is the following provision in the offer of employment:

5. Termination of Employment Your employment may be terminated in accordance with the notice requirements set out in the Endeavour Credit Union Enterprise Agreement, 1997.

6 A further annexure to the summons was the respondent's letter terminating the applicant's employment. That letter contained the following: As a result, a redundancy package payment will be paid in accordance with EACU policy. The attached sheet details the redundancy payment amounts. A separate sheet annexed to the summons detailed payments made on termination of the applicant under the heading: "EACU Redundancy calculation as per EACU Redundancy Agreement". That document dealt with notice and severance pay but under the heading "other payments due" also dealt with annual leave and long service leave. A further document was annexed to the summons for relief which appears to be an extract from the Endeavour Advantage Credit Union Employment and Redundancy Policy books. The document was headed "EACU redeployment and redundancy policy" which contained several definitions, provisions relating to redeployment, periods of notice, the redundancy package and other payments. The document also dealt with payments of annual leave, long service leave and superannuation. Under a sub-heading "Disputes" the following was provided: Any dispute arising out of the interpretation, application or operation of this agreement shall be settled pursuant to the disputes settlement procedures prescribed in this EACU human resources policy and the SCC terms of reference. The documents entitled "EACU Redeployment and Redundancy Policy" was a document handed to the applicant on the day of termination together with the letter of termination and her final pay calculation documents.

7 By notice of motion, the respondent claimed an order that the proceedings commenced by the applicant be struck out or dismissed and consequential orders as to costs. The grounds and reasons specified in the notice of motion were as follows: 1. The respondent commenced employment with the applicant on or about 5 June 2000. 2. The Endeavour Credit Union Limited Enterprise Agreement 1997 ("the Agreement") is a certified agreement of the Australian Industrial Relations Commission made pursuant to the Workplace Relations Act 1996 ("WR Act"). 3. At all material times the applicant and respondent were bound by the provisions of the Agreement in respect of termination of employment and redundancy, which provisions were comprehensive. 4. The Agreement is a commonwealth law for the purposes of section 109 of the Constitution and section 170LZ of the WR Act. The Industrial Relations Act 1996 (NSW) ("IR Act") is a State law for the purposes of those sections. 5. The effect of the claim made by the applicant in these proceedings and any order of the Commission sought to be made in these proceedings would interfere with, alter, impair or detract from the terms of the Agreement relating to termination and redundancy. 6. As a consequence the Agreement prevails over section 106 of the IR Act and any order made pursuant to section 106 which are invalid to that extent. 7. The Commission does not have jurisdiction to hear or determine these proceedings.

8 The 1997 Enterprise Agreement contained an exemption clause which had the effect of removing the applicant from the benefits of a number of provisions of the agreement and the award. A number of those matters were governed by the employer's letter of offer of employment which were signed and accepted by the applicant. Award and agreement provisions which appeared to apply to the applicant included those dealing with termination of employment and providing for periods of notice. An annexure under the heading "Redeployment and Redundancy Agreement", presumably part of the enterprise agreement, provided in clause 2 that the agreement between the Credit Union and the Finance Sector Union would "… apply to members of the union employed by the ECU as full time or part-time employees". It also appeared to apply to employees for a fixed term or specific project, a provision which does not, on the material before the Court, appear to apply to the applicant. There was no evidence as to whether or not the applicant was a member of the Finance Sector Union, however the submissions proceeded on the basis that the redeployment and redundancy provisions applied either from the agreement or the award.

9 The respondent's submissions proceeded on the basis that the 1997 Enterprise Agreement applied to the applicant and that the Agreement made specific provision with respect to the very matters which were the subject of claims made by the applicant in the summons filed under s 106 of the New South Wales Act. It was submitted that the Agreement provided the rate of pay to be applied in calculating a payment in lieu of notice and specified the rights and obligations of an employee in a redundancy situation.

10 In relation to this situation, the respondent submitted that, while the Enterprise Agreement was not a law of the Commonwealth (cf Metal Trades Industry Association of Australia v Amalgamated Metal Workers and Shipwrights' Union (1983) 152 CLR 632 at 641 and 648), Parliament had nevertheless made a specific provision in s 170LZ of the Workplace Relations Act, namely: (1) Subject to this section, a certified agreement prevails over terms and conditions of employment specified in a State Law, State Award or State Employment Agreement to the extent of any inconsistency. (2) Provisions in a certified agreement that deal with the following matters operates subject to the provisions of a State law that deals with the matter: (a) Occupational Health and Safety; (b) Workers Compensation; (c) Apprenticeship; (d) any other law prescribed by the regulations . (3) If a State law provides protection for an employee against harsh, unjust or unreasonable termination of employment (however described in the law), subsection (1) is not intended to affect the provisions of that law that provides that protection, so far as those provisions are able to operate concurrently with the certified agreement.

11 The respondent submitted that s 106 of the Act and any order made under it was not a "State law" providing protection against harsh, unjust or reasonable termination of employment as referred to in s 170LZ of the Workplace Relations Act (Beahan v Bush Boake Allen Australia Ltd (1999) 47 NSWLR 648 and Barry v Australian Broadcasting Commission [2002] NSWIRComm 14 at [26]). It was further submitted that there were no relevant matters prescribed by the regulation, which was identified as being Regulation 30ZE.

12 Attention was drawn to the judgment of Kirby P in Majik Markets v Brake and Service Centre Drummoyne Pty Ltd (1992) 28 NSWLR 443 as explaining the operation of the various tests used by the courts to assess whether an inconsistency existed under s 109 of the Constitution in a particular case. It was said that his Honour's judgment demonstrated that there was inconsistency where there existed a "textual collision" between the provisions of a Commonwealth and State Act. Even when there was no such collision, an inconsistency arose where the intention of the paramount legislature is, by its enactment, to completely, exhaustively or exclusively express the law governing a particular conduct or matter (Majik Markets at 448F-450A, also Felman v Law Institute of Victoria (1997) 142 FLR 362 at 381; Metrocall Inc v Electronic Tracking Systems Pty Ltd (2000) 101 IR 66 at 76-7. An inconsistency also arose where a law purports to confer a legal right, privilege or entitlement which the other law purports to take away or diminish.

13 Reference was also made to the more recent decision of the High Court in Telstra Corp Ltd v Worthing (1999) 197 CLR 61 where it was stated: In Victoria v The Commonwealth, Dixon J stated two propositions which are presently material. The first was: When a State law, if valid, would alter, impair or detract from the operation of a law of the Commonwealth Parliament, then to that extent it is invalid. The second, which followed almost immediately in the same passage was: Moreover, if it appears from the terms, the nature or the subject matter of a Federal enactment that it was intended as a complete statement of the law governing a particular matter or set of rights and duties, then for a State law to regulate or apply to the same matter or relation is regarded as a detraction from the full operation of the Commonwealth law and so is inconsistent. The second proposition may apply in a given case where the first does not, yet, contrary to the approach taken in the Court of Appeal, if the first proposition applies, then s 109 of the Constitution operates even if, and without the occasion to consider whether, the second proposition applies. (paragraph [28], page 76-7).

14 It was submitted that Worthing was authority for the proposition that there may be inconsistency even where it is possible to obey both laws, where for example a State law, if allowed to operate, would impose an obligation greater than that for which the Federal law provided (at paragraph [27], p 76). Reference was made to the joint judgment of Gibbs CJ, Wilson and Dawson JJ in MTIA, namely: A law of a State will be inconsistent with an award and consequently with a law of the Commonwealth if its effect, if enforced, would be to destroy or vary the adjustment of industrial relations established by the award with respect to the matters formally in dispute … .

15 The respondent argued that there was a clear intention evinced that the terms of the Enterprise Agreement were to prevail over terms and conditions of employment specified in a State law to the extent of any consistency. The operation of 170LZ of the Workplace Relations Act and the certified agreement had "established the precise content of the rights and obligations of the parties in these proceedings with respect to termination of employment and redundancy". The Federal legislation had considered what provisions of State law could apply (s 170LZ(2)) and termination of employment and redundancy payments were not amongst those matters.

16 An order made in the present proceedings would provide terms and conditions pursuant to a State law. Such an order would impose upon the respondent employer obligations to the applicant in relation to termination of employment and redundancy. Such an order would affect the rights of the parties inter se. Such an order dealing with those terms and conditions would therefore be inconsistent with the provisions of the Enterprise Agreement. The rights of the employer under the Agreement to terminate an employee by the giving of the specified notice or payment in lieu would be altered, impaired or detracted from by an order made by the Court in these proceedings. The same applied to any order made in relation to redundancy payments.

17 It was noted that, in Burgess v Mount Thorley Operations Pty Ltd [2002] NSWIRComm 106, Schmidt J had considered the intention expressed by the legislature in s 152 of the Industrial Relations Act 1996. It was pointed out that, while her Honour concluded that s 170LZ of the Workplace Relations Act did not arise for consideration in connection with the Enterprise Agreement under consideration in that particular case, her Honour nevertheless concluded that, even if she were to reach a different view, she doubted that the inconsistency would have been resolved. 18 The respondent accepted that there were differences in the terms of s 152 of the Industrial Relations Act 1988 and s 170LZ of the Workplace Relations Act. In particular, it was accepted that s 170LZ did not include the phrase "or deals with a matter dealt with in an award". However, it was submitted that notwithstanding the different terms it was clear that s 170LZ was intended to "cover the field". Indeed, by specifying the matters that a State law may deal with, the paramount legislature expressed the intention to otherwise deal exhaustively and exclusively with other terms and conditions specified in certified agreements. That intention was confirmed by sub-section 3, where a particular category of State law, namely, one providing for protection against harsh, unjust or unreasonable termination of employment may operate concurrently with a certified agreement.

19 In oral argument, the respondent accepted that there was a separate contract of employment but hastened to add that any order made pursuant to the State law, s 106 of the Act, would operate inconsistently with the Federal regulation. The fact that there was a separate contract of employment was said to be not to the point. It was also accepted that there was no prohibition on the parties contracting for what they wished but there was, in effect, a prohibition on the State law operating inconsistently with the Federal instrument, which was the situation in this case.

20 In the same vein, it was accepted by the respondent that its redundancy policy operated separately from the enterprise agreement but that did not change the circumstances that confronted the applicant here.

21 Annexure 2 to the certified agreement was part of that agreement and was called the "Redeployment and Redundancy Agreement". While it was accepted that there was no evidence as to whether the applicant was a member of the Union and the agreement stated that it applied to members of the Union, it was submitted that, viewing the certified agreement as a whole, it made provision in respect of redundancy in relation to members by providing benefits in that agreement and thereby made provision in respect of non-members by confining the redundancy provisions to members. If that was not correct then the award provisions applied. It was accepted that the award was a minimum rates award.

22 If the award applied, as the only relevant Federal instrument, then the respondent submitted that s 152 of the Workplace Relations Act was relevant. It was accepted that s 152 was not identical to but similar to the previous provisions ie. s 65 as dealt with in the cases. Section 152 is in the following terms: [s 152] Awards to prevail over State Laws and State awards 152(1) [Awards to prevail] Subject to this section if a State law or a State award is inconsistent with, or deals with a matter dealt with in, an award, the latter prevails and the former, to the extent of the inconsistency or in relation to the matter dealt with, is invalid. (1A) [State laws making provision in respect of termination] If a State law provides protection for an employee against harsh, unjust or unreasonable termination of employment (however described in the law), subsection (1) is not intended to affect the provisions of that law that provide that protection, so far as those provisions are able to operate concurrently with the award. (2) [State employment agreement previously in force] If: (a) but for this subsection, an award would become binding on an employer in respect of an employee at a particular time; and (b) immediately before that time, the wages and conditions of employment of the employee were regulated by a State employment agreement; then the award is not binding on any person in respect of the employee, while the wages and conditions of employment of the employee continue to be regulated by the agreement. (3) [State employment agreement made after commencement of subsection (3)]. If, at a particular time, a State employment agreement that is made after the commencement of this subsection would regulate wages and conditions of employment of an employee but for the fact that an award is binding on an employer in respect of the employee, then: (a) the award does not prevent the agreement from coming into force and regulating the wages and conditions of employment of the employee; and (b) while the agreement continues to regulate those wages and conditions, the award is not binding on any person in respect of the employee. (4) ["award"] In subsection (3), "award" does not include an award made under subsection 170MX(3) (5) [Requirements for application of subsections (2) and (3)]. Subsection (2) and (3) do not apply to a State employment agreement unless the agreement is one that was approved by a State industrial authority under a State Act that required the authority, before approving the agreement, to be satisfied: (a) that the employees covered by the agreement are not disadvantaged in comparison to their entitlement under the relevant award; and (b) that the agreement was genuinely made, or that the agreement was not made under duress or that the agreement was made without coercion; and (c) that the agreement covers all the employees whom it would be reasonable for the agreement to cover, having regard to matters (if any) specified in the State Act (such as the nature of the work performed under the agreement and the relationship between the employees in the part of the business covered by the agreement and the remainder of the employees in the business).

23 A consideration of the orders sought made it clear that any order made by this Court would operate inconsistently with the terms and conditions set out in the certified agreement. The two tests specified by Dixon J, of direct conflict and covering the field, were met in this particular case.

24 For the applicant, it was submitted that the respondent's strike out application was based upon considerations dealt with in Burgess and Ors v Mount Thorley Operations Pty Ltd. The history of industrial relations, in that case, prior to the filing of applications under s106 of the New South Wales Act were complex and involved a notification of an industrial dispute and an application for interpretation of an enterprise agreement in the Federal Court. It was suggested that, in essence, the case for the applicants in Burgess was that the terms of the enterprise agreement were unfair and that those terms should be regarded as implied terms of the employees' contracts and, as such, could then be voided or varied pursuant to s 106 of the New South Wales Act. In effect, this was a "back door" way of seeking to vary the terms of the enterprise agreement "dressed up" as implied terms of a contract of employment. It was said that her Honour's rejection of the claim, although the case related to a Federal enterprise agreement, would have been the same if it was a Federal award or any State registered enterprise agreement or award. In the applicant's submission, what her Honour did not find, however, was that just because an applicant's contract had been subject to an award or registered agreement per se, whether Federal or State, the Commission lacked jurisdiction under s 106 of the Act.

25 The applicant propounded the relevant test for inconsistency in the following terms: inconsistency of law arises in cases pursuant to s 106 where the facts of alleged unfairness in the applicant's contract are wholly regulated by an instrument or provisions having paramount statutory force (that is, to the express exclusion of s 106) but not if that instrument or those provisions have only concurrent and complimentary force, and/or are merely conducive to the terms of the contract.

26 It was accepted by the applicant that the Commission's jurisdiction under s 106 was ineffective where the applicant's contract was wholly regulated by a Federal Act (as in Harrison v Australian Meat and Livestock Corporation (1994) AILR 174; Dawson v Telstra Corp. Ltd (1998) 44 AILR 5-176) or by a State Act (as in Garde v WorkCover Authority of New South Wales (1993) AILR 79; Health and Research Employees' Association of Australia (NSW) v Youth and Community Services (1986) AILR 408). Thus, it was submitted, an employee's contract may be wholly regulated by some statutory provisions and outside the reach of s 106 of the Act even though it is otherwise regulated by an award or agreement made under the New South Wales Industrial Relations Act or the federal Workplace Relations Act. In these cases, the Commission looked to the particular instrument or statutory provisions to ascertain if its jurisdiction under s 106 was expressly or impliedly excluded. The fact that the respondent is a statutory body established under an Act of Parliament may not, of itself, preclude jurisdiction (Sharkey v MWSBB (1981) AILR 297). In some cases, the Act may have express provisions purporting to avoid inconsistencies (as in Majik Markets v Brake Services Centre Drummoyne Pty Ltd & ors

27 Uncertainty had arisen, so it was submitted, in cases where an Act, award or recent agreement was involved and where it is not clear whether and, if so, how, those statutory provisions interfere with the jurisdiction conferred by s 106 of the Act. In these cases, it was not just a matter of applying the various "cover the field" tests that have been developed in order to discern between conflicting Federal and State law but rather it was necessary to discern whether the factors of the alleged unfairness in terms of the contract, or the way it operated, or the way it had been brought to an end, were wholly regulated by that Act, award or registered agreement, Federal or State.

28 The applicant drew attention to a number of decided cases to demonstrate how the Commission had dealt with these situations: (a) in Huskisson RSL Sub Branch Club Ltd v Sullivan (1990) 32 IR 404 the alleged unfairness was in the fact that the applicant received less remuneration than the relevant award provided. That unfairness was regulated by the award and the Act provided elsewhere in its provisions for the appropriate remedy. However, the jurisdiction of s 88F (as it then was) was not precluded because it was deemed also unfair that the respondent had subverted provisions of the award by characterising the applicant as a contractor and therefore s 88F(e) applied. In that case, there were concurrent and complimentary, not inconsistent, provisions; (b) similarly, in Hussman v Walker (1993) 31 NSWLR 189 it was held that the unfair dismissal provisions of the New South Wales Act did not preclude the jurisdiction of what was then s 275; (c) on the other hand, in J Green and Courtesy Real Estate Pty Ltd (1981) AILR 65, the matters complained of by the applicant were held to be wholly regulated by a conciliation committee expressly established to deal with such compliance;

(d) in Casey v Wentworthville Memorial RSL Club ( 1986) 16 IR 337, it was held that the whole of the applicant's contract was regulated by an award. In matters involving Federal awards, it has been held that the unfairness that was complained about was exhaustively covered by the Federal Award (Richard James Hudson v Qantas Airways Ltd (1984) AILR 105; 1985 AILR 274; Kanan v APTU (1991) AILR 46). (e) in regard to a redundancy, the Commission has held that, even though the New South Wales Parliament had provided specific legislation for redundancy in the Employment Protection Act 1982, that did not preclude the operation of s 88F ( Incitec Ltd and anor v Barry & ors (1992) 29 NSWLR 83); (f) where a Federal Award provided for redundancy in respect of an application under s 88F; it did not deal entirely with the issue and there was no inconsistency involved ( ICI Australia Operating Ltd v Hutton (1993) AILR 218).

29 The applicant submitted that the following facts distinguished the present case from Burgess: (a) in Burgess, the applicants were retrenched and there was no issue as to that fact. What the applicants pleaded was the unfairness of the terms of the redundancy provisions of the enterprise agreement involved; (b) the applicant in the present case does not say the enterprise agreement was unfair, she says the functions of her position were not redundant nor was her contract of employment validly terminated for reasons of redundancy; (c) in Burgess, the applicants had not been promised permanency of employment - the opposite seems to have been the case. The company had entered into an elaborate arrangement with the unions on terms designed to avoid the closure of a mine by the introduction of short term measures involving the employment of additional temporary staff under a plan that might hopefully have led to the long term viability of the enterprise. When that failed and the staff had to be retrenched, the issue of "first on last off" arose, together with the right to compensation; (d) in the present case, the applicant was "headhunted" to fill a specific position. She had a secure job in the Public Service with generous maternity leave provisions. She was about to marry and planning to start a family. In the knowledge that the respondent was in the process of amalgamating with another credit union, she sought particular assurance that the position offered to her was to be permanent. She was given that assurance. After the amalgamation was finalised she was made "redundant"; (e) in Burgess, the applicants' contracts were wholly regulated by their enterprise agreement, as were the factors of unfairness about which they complained. To have granted the orders they sought would have, in effect, "re-written" the terms of that agreement as it applied to them; and (f) in the present case, the applicant's contract was not wholly regulated by the enterprise agreement and the orders sought did not affect the agreement as it related to her, nor did the agreement regulate in any way the factors of alleged unfairness involved.

30 In oral submissions, counsel for the applicant claimed that there was a fundamental error in the approach of the respondent: the Federal industrial agreement simply directed attention to basic rights of employer and employee while the Court under s 106 of the Act would be directing its attention to the contract and what should be paid by way of a form of compensation or a form of remedy which was deemed to be just in the circumstances of the case.

31 The essential unfairness claimed by the applicant was that, having been head hunted from secure employment at a vital time in her life, she sought and was guaranteed that her employment with the respondent would be permanent regardless of the fact that a merger or amalgamation of credit unions took place. The assurance of permanence and the representations made in that regard were not covered by the award or the agreement. In this case, the applicant was saying that she was not redundant and that the provisions of the award and the agreement did not apply to her because of the assurance of her permanent position - the circumstances of her being head hunted and promised redundancy would result in a grant of some monetary amount in compensation under s 106 of the Act.

32 When it was pointed out to counsel for the applicant that the orders as filed did not appear to contemplate a compensation order made on the basis of being head hunted, lured from secure employment and promised permanency and compensation for the unfairness of the representations made, it brought forth a response that may be, in the course of dealing with the matter, those precise orders would need to be looked at. The following submission was then made: This case is based squarely, if not pleaded too succinctly or accurately in the unfairness of the circumstances that require the Commission with the Act itself under the section of the Act that allows the Commission to grant a sum of money whether by way of compensation or by way of restitution, but certainly it is not a case based on the fact that she did not get redundancy. She is not arguing about the agreement, the industrial agreement nor is she seeking to re-write it in her case or anybody else as in Burgess. She is simply saying that on the facts she got an overt deal and is the kind of case that s 106 addresses.

33 Not surprisingly, counsel for the respondent in reply stated that he could not respond definitively to this submission because it depended on the nature of any amendment and the way such an application could be made - in short, and not unreasonably, he needed to consider any amended order sought by the applicant.

34 This development clearly raised the Full Court's caution against entertaining issues going to jurisdiction at too early a stage of s 106 proceedings (see Nagle v Tilburg & anor (1993) 51 IR 8).

THE CASE LAW CONSIDERED 35 It can be seen from the respondent's submissions that some emphasis was placed upon the judgment of the High Court in Metal Trades Industry Association of Australia and ors. v The Amalgamated Metal Workers and Shipwrights' Union and ors. That case dealt with the direct conflict between the provisions of the Metal Trades Industry Award 1971 made under the Conciliation and Arbitration Act 1904 (Cth) and the provisions of the Employment Protection Act 1982 (NSW). While the court held that there was inconsistency within the meaning of s 109 of the Constitution, the discussion touched upon not only the appropriate principles where issues of inconsistency arose but also dealt with a variety of circumstances where difficult situations could arise for the application of those principles. 36 In the joint judgment of Gibbs CJ, Wilson and Dawson JJ, the position of the Federal Award and how it was to be treated under s 109 was discussed at 641, as follows: The Metal Industry Awards were made under the authority of a Commonwealth Act. They are not themselves laws of the Commonwealth and without more could not attract the operation of Section 109 of the Constitution so as to override inconsistent State laws or awards. However, the Parliament has made specific provision in this regard in Section 65 of the Commonwealth Act, which reads as follows: Where a State law, or an order, award, decision or determination of a State Industrial Authority, is inconsistent with, or deals with a matter dealt with In an award, the latter prevails and the former, to the extent of the inconsistency or in relation to the matter dealt with, is invalid. The word 'or deals with a matter dealt with in' and 'or in relation to the matter dealt with' were added by amending Act in 1928. In Ansett Transport Industries (Operations) Pty Ltd v Wardley (1980) 142 CLR 237 at 278, Aicken J observed that: [The] added words have given rise to some difficulty as they appear to go beyond Section 109 and if so, would be beyond power'. In making that observation, his Honour was reinforcing the reservation expressed in the joint judgment of Dixon CJ, McTiernan, Williams, Webb, Fullagar and Kitto JJ in Collins v Charles Marshall Pty Ltd (1955) 92 CLR 429 at 549, where their Honours said: ' In terms this provision goes beyond any operation possessed by Section 109 because it relates not only to inconsistencies but to the valid application of State law to a matter dealt with in an order or award. It may be that no contrast was intended between the latter conception and the conception of actual inconsistencies. But if a distinction is intended the extension seems unwarranted … the provision may be used as indicating an intention on the part of the Federal Parliament that the power of the arbitrator to determine an industrial dispute enables him to make an exhaustive provision completely governing matters within the ambit of the dispute to the exclusion of any other regulation. But it is difficult to support the provision as directly operating to amplify or extend Section 109.' See also T.A. Robinson & Sons Pty Ltd v Haylor (1957) 97CLR 177. The problem therefore is to be approached on the basis that the alleged inconsistency is between the Commonwealth Act which authorises the making of the awards and the State law and the solution is to be found in application of s 109 and the well-established doctrine of inconsistency derived therefrom. At the heart of the doctrine is the call to take the law or the award with which the State law is alleged to be inconsistent and discern precisely the matters which it is the intention of the Parliament, or the Commonwealth arbitrator as the case may be, are to be exhaustively determined thereby. In the case of an award which deals with a dispute between parties whose relations apart from the award are ordinarily governed by State law including the common law, the existence of the State law is for the most part assumed and this assumption will be relevant to discerning any inconsistency (cf Wardley, per Wilson J at 287-288). The contract of employment itself is the most obvious illustration. To the extent that it is not varied by the award, its obligations will ultimately be derived from State law. The question will often be whether the award provisions are intended to supplement or modify rather than supplant State law (at 641-642).

37 In dealing with the appropriate tests in cases of inconsistency their Honours stated: A law of the State will be inconsistent with an award and consequently with a law of the Commonwealth if, "its effect, if enforced, would be to destroy or vary the adjustment of industrial relations established by the award with respect to the matters formerly in dispute": (per Isaacs J in Clyde Engineering v Cowburn (1926) 37 CLR 466 at 499). Another helpful formulation of the relevant test of inconsistency was expressed by Dixon J, at pp 642 -643, in Victoria v The Commonwealth (1937) 58 CLR 518 at 630: When a State law, if valid, would alter, impair or detract from the operation of a law of the Commonwealth Parliament, then to that extent it is invalid.

38 Their Honours were of the view that the distinction between the right to dismiss and the machinery of termination, which had caused some members of the court in Wardley to express different opinions on the effect of the award provision there under consideration, was not material in relation to the present circumstances. This was because their Honours were of the opinion that the provisions of the State Act plainly interfered with the relationship of employer and employees established by the awards with respect to the termination of the employment. Part 2 of the State Act was dealing precisely with the same topic as covered by the awards, namely, the procedure which the employer must observe if he wished to terminate the employment. They concluded that, on their proper construction, the awards did not leave any room for State law to attach additional obligations to an employer (at 644).

39 The joint judgment then explained why the decision in Wardley did not result in rejection of the alleged inconsistency between the State law and the Federal award in this case. In that case, it was said that the Equal Opportunity Act 1977 (Vic) was inconsistent with the Airline Pilots Agreement 1978, an agreement which had been certified under the Commonwealth Act. By majority, the court thought that the Agreement provided for the services of a pilot to be terminated on notice subject, in the case of some pilots, to resort to grievance procedures. Section 18 of the Act rendered it unlawful for an employer to discriminate against an employee on the ground of sex or marital status. Stephen J regarded the right of termination of the contract of employment under the agreement as conferring no absolute right in that regard: the right which the agreement conferred was not one which was capable of exercise regardless of the unlawfulness, under State law, of the ground for its exercise. It was a right which was to be understood against the background of its operation which general laws of the land, whether State or Federal in origin, provided. Other members of the court held that the agreement did not confer an unqualified right to dismiss a pilot regardless of the general law. Importantly, their Honours, at p 646, then stated: It is also to be observed, as Stephen J emphasised (1980) 142 CLR at 248 - 249, that the agreement and the Act dealt with entirely disparate subject matters, the former being narrowly confined to employment relationships determined in settlement of an industrial dispute and the latter with the general social question of equality of opportunity between men and women.

40 The joint judgment continued that it was not to the point that both the State law and the award could be obeyed. They referred to the joint judgment of Dixon CJ, McTiernan, Williams, Webb, Kitto and Taylor JJ in T.A. Robinson and Sons Pty Ltd v Haylor (1957) 97 CLR 177 namely:

The theory upon which the operation of State law gives way in favour of an award providing an inconsistent industrial regulation imputes to the Conciliation and Arbitration Act an intention to confer power upon the arbitrator to make on a subject of dispute an exhaustive determination containing an industrial regulation that, on the subject with which it deals, will cover the ground to the exclusion of any different or further provision. In their Honours' view there could be no question of the State Act having a subject matter which was separate and distinct from the subject with which the awards dealt - the State Act had to give way to the metal awards.

41 Although concurring in the result, Mason, Brennan and Deane JJ considered the issues which arose in a separate joint judgment. Their Honours, at p 648, stated their approach as follows: For the purposes of Section 109 of the Constitution the doctrine of inconsistency has, to a significant extent, been expounded by this Court in the context of conflicts or supposed conflicts between the federal awards on the one hand and State laws or awards on the other. It was in this very context that Isaacs J first formulated the 'covering the field' test (Clyde Engineering Co. Ltd v Cowburn (1926) 37 CLR 466 at 489), a test which was later taken up and elaborated by Dixon J in Ex parte McLean (1930) 43 CLR 472 at 483, and Stock Motor Ploughs Ltd v Forsyth (1932) 48 CLR 128 - 136; see also Victoria v The Commonwealth ('The Kakariki') (1937) 58 CLR 618 at 630). Dixon J pointed out in Stock Motor Ploughs that inconsistency will result if the State law varies, impairs or detracts from the operation of a law of the Commonwealth and that if the Commonwealth law is on its true construction intended to be a complete statement of law governing a particular matter or relation then for a State law to affect the same matter or relation is regarded as a detraction from the full operation of the Commonwealth law.

42 Their Honours accepted that, although a Federal award was not a law of the Commonwealth within the meaning of s 109, alleged inconsistency between an award and a State law had to be reduced to inconsistency between the State law and the provision in the Act authorising the making of the award so as to constitute it as an exhaustive and exclusive regulation of the relevant subject matter, referring to T.A. Robinson & Sons Pty Ltd. Their Honours, at pp 648 - 649, then stated: In this respect Section 65 of the Act (Section 30 of the Act of 1904) is of paramount importance for it is the expression of the statutory intention that the arbitrator's exercise of power is to operate to the exclusion of any State law. Unfortunately, s 65, like s 109, is couched in terms which purport to invalidate an inconsistent State law, rather than in terms of a declaration that the award is to have an exclusive operation. Moreover, its language goes beyond the language of s 109. Their Honours noted that in Wardley and the cases referred to in that judgment, s 65 was to be regarded as evincing a statutory intention that an award made pursuant to the Act was to operate to the exclusion of any State law. This was made evident by the inclusion in s 65 of the words not found in s 109 which related to the operation of a State law which "deals with a matter dealt with in" an award.

43 Their Honours, at 649, then posed the question to be determined: The critical question then is:

What is the conduct or matter with which the relevant awards deal? For the effect of Section 65 is to make the provisions of the award exclusive in relation to that conduct or matter and must make it inconsistent for the law of the State to govern what is dealt with by the award. The section contradicts the hypothesis that the award provisions are intended to operate side by side with the provisions of a State law dealing with that conduct or matter.

44 In looking at the field of operation of s 65 of the Commonwealth Act, the joint judgment noted that generally industry awards had steadily become more comprehensive in their reach, regulating in a detailed fashion the terms and conditions of employment. The award was the final product of a complex process of conciliation and arbitration set in train by the service of a log of claims and its non acceptance. The settlement reached was intended to be enduring and in such a situation it was 'natural and convenient' that the award should be regarded to the exclusion of the State law, as expressing the relations of the parties governing the matters with which it dealt. Nevertheless, their Honours regarded it as "inevitable" that there would be some matters with which a comprehensive general industry award failed to deal either because the parties were content to accept the application of State law (in relation, for example, to workers' compensation) or because it has been considered that an award cannot validly deal with the matter. Their Honours continued: It may appear from the terms and nature of an award, or from the subject - matter with which it deals, that, notwithstanding that it contains provisions dealing with a particular matter, it is not intended to deal with the matter to the exclusion of any other law. At first glance there might seem to be a problem in accommodating such an award to the language of Section 65. But in such a case it will be found that the award fails to deal with the particular conduct or matter which is regulated by the State Statutes. In this respect it is important to note that an award which apparently regulates an entire subject - matter may leave some small area of it untouched. This area may then become the relevant field capable of regulation by State law. An award which provides for the terms and conditions of employment and termination on notice but not dismissal for misconduct fails to deal with this misconduct and leaves that particular matter or conduct to be regulated by State law (Reg. v Clarkson; ex parte General Motors - Holden's Pty Ltd (1976) 134 CLR 56).

45 The joint judgment then stated that, in order to decide whether the award dealt with a particular matter and thereby excluded State law may necessitate looking beyond the actual terms of the award to the log of claims on which the award was based. Their Honours, at p 641, then turned to particular cases, where for the first time, State legislation provided benefits that may not have been contemplated by the parties when making their award arrangements: The difficult case, as we indicated earlier, is that of an award apparently complete on its face and a subsequent State Statute which confers new rights on employees in the sense that the new rights have not previously been accorded generally by industrial awards or contracts of employment. It might be said that the Court should not be too ready to conclude that the new statutory rights are consistent with the award because this may disturb the settlement effected by the award. Such an approach is not acceptable, however, for the reason that it disregards the fact that awards are framed to operate in the context of general law, both State and Federal. The correct approach in such a case is that the award fails to deal with the matter provided for by the Statute, and unless the award exhibits an intention there is to be no benefit of that kind or, alternatively, that the benefits for which it provides are to be a complete and exclusive statement of the employee's entitlement in the relevant area. Such an intention cannot be ascribed lightly to an award. It will not often transpire that the class of benefits provided by the Statute was demanded by the log of claims or otherwise made part of the industrial dispute settled by the award. In this respect we need to keep steadily in mind the limited nature of the Commonwealth Parliament's legislative power under Section 51(XXXV). The consequence is that to attribute to an award an intention to exclude benefits for which it makes no provision may be to prevent any Australian legislature from making provisions for them in the case of parties bound by the relevant award, unless in a particular case another head of Commonwealth power is available. It therefore comes as no surprise to find that, in general, statutory rights of the kind mentioned have been treated as standing outside the matters or relations dealt with by awards, unless specific provisions is made with respect to them. This is because the subject matter of the new statutory rights has not been within the purview of the award. The matter was not within contemplation when the award was made or when the dispute arose … .

46 On analysis, their Honours were of the view that the award had the appearance both in form and in substance of being a complete statement of the rights of the parties with respect to termination of employment in the ordinary course of affairs. On this analysis the State law was inconsistent with the Federal award.

47 The close scrutiny of the field covered by the Federal award, referred to in the judgment of MTIA above, was reflected in the approach of a Full Bench of the Commission in Hudson v Qantas Airways Ltd (1985) 10 IR 331. In that case, the applicant under the then s 88F of the Industrial Arbitration Act 1940 sought an order that an agreement with his employer with respect to leave without pay be avoided on the grounds that it was unfair, harsh and unconscionable. The agreement arose in circumstances where his conditions of employment were regulated by a Federal award and where he was "held out of service without loss of pay" while certain apparently criminal charges were pending against him. When he was convicted of one charge, there was an agreement he be allowed to take leave without pay pending his appeal. That is the agreement the appellant sought to have the subject of orders under s 88F. After his appeal was successful, the employee sought the payment of his wages lost while he was being treated as on leave without pay. The Federal award made no provision for leave to be taken without pay or for suspension of the contract of employment.

48 The employer raised the provisions of s 65 of the Australian Conciliation and Arbitration Act bringing about the operation of s 109 of the Constitution in relation to this claim under s 88F of the State Act. The employer submitted that the claim was simply one for wages for the period of absence and travelling allowances which were regulated by the award and therefore no effective order could be made. Any claim for recovery of award entitlements could be pursued only under the Conciliation and Arbitration Act.

49 In relation to these arguments the Full Bench of the Court stated at pages 333 - 334:

In the light of the many authorities concerning the question of inconsistency where a Federal award is involved, (see, in particular, Metal Trades Industry Employers Association v Amalgamated Metal Workers Union (1983) 4 IR 284; 48 ALR 385 and the cases there discussed), it cannot be said that, as a general rule, inconsistency would arise simply because a Federal award regulates a particular employment in respect of which an order may be sought under s 88F(1) avoiding or varying the contract of employment or any collateral contract or arrangement, or, under Section 88F(2), to rectify or adjust, by the payment of money sums, any unfairness or the like which may have been suffered. Apart from the need to examine the declaration or orders which might be made under s 88F in the light of what is embraced by the particular award and the settlement achieved by it, the special nature and purpose of Section 88F makes inconsistency potentially unlikely to arise, especially where an alleged unfair situation relates to aspects of the employment relationship extraneous to the specific subject matters regulated by the award. Logs of claims and Federal awards are normally formulated against the background of the general law and its continued application (see Employment Protection Case (1983) 4 AR 284; 48 ALR 385 and Ansett Industries v Wardley (1980) 142 CLR 237. This, as earlier stated, is something which … the award expressly recognises. What may be the type of issue capable of resolution under Section 88F, where a Federal award exists, need not be precisely defined, however, for the purposes of this appeal. For it is clear that, with one exception, this is not a case which deals with disparate or extraneous subject matters so far as the substance of the orders sought are concerned. It is not, for example, a situation where a State enactment is being invoked to deal with the subject of leave without pay, either in a general way or even in a confined sense of the standing down or suspension of employment rights and obligations in disciplinary situations, as a specific subject matter. If so, it may have been arguable that the orders sought under Section 88F concerned a subject matter outside the purview of the award, as, for example, was held to be the position concerning long service leave (see Charles Marsh Pty Ltd v Collins (1957) 96 CLR 1) … Ultimately their Honours were able to deal with the case by looking at the substance of the claim and determining that, regardless of how it might be described, in fact it was a claim for the payment of money in relation to matters directly covered by the Federal award. Thus the court, at page 336, concluded:

What is sought, in reality, is a sum to embrace salary and travelling allowances which are matters prescribed by a Federal award. That Section 88F is directed at a special type of case does not necessarily alter the consequence which flows from that situation. After citing authority, their Honours, at pages 336 - 337, continued: Here, however, the order for payment claimed, to the extent that it relates to compensation for loss of travelling allowances, would make the respondent liable, in effect, to pay this allowance in circumstances beyond those specified in the award as the basis for entitlement. With respect to the salary component, account must be taken of the fact that the award is merely one method of prescribing the remuneration applicable to the employment relationship on which, together with the performance of services, any claim for payment of remuneration depends (see Mallinson v Scottish Australian Investment Company Ltd (1920) 28 CLR 66 at 73). In the context of this case, however, the order which is sought under Section 88F(2), to the extent that it relates to restitution of salary lost during the period of leave without pay, is based on what is prescribed by the award, not some contracted amount. On that basis, an award under Section 88F(2) would, in effect, impose an obligation to pay the award salary in respect of a period during which, because of the particular circumstances of the case, there was no obligation under the award to pay such salary. Furthermore, such an order could be said to involve the prescription of an additional and distinct mode of recovery beyond the Conciliation and Arbitration Act. Their Honours were of the view that the exclusive operation of the award therefore applied to travelling allowances and salary such that valid orders under the New South Wales Act could not be made in relation to those matters. However, the matter of superannuation was held to be different because it was "part of the contractual relationship between the respondent and the applicant which cannot be said to be the subject of regulation by the relevant Federal award or otherwise be capable of giving rise to inconsistency on the material before us". That matter was left to the trial judge to consider what orders could be validly made.

50 As can be seen from the above paragraphs, in both the MTIA case and the Hudson case reference was made to the earlier decision of the High Court in Ansett Transport Industries (Operations) Pty Ltd v Wardley (1978 - 1979) 142 CLR 237. In that case, Ms Wardley, on the grounds of alleged sex discrimination, had challenged Ansett's refusal to employ her as a pilot. She obtained orders under the Equal Opportunity Act 1977 (Vic) including an order that Ansett should engage her as a trainee pilot not later than its next intake of pilots. Ansett challenged the orders in the Supreme Court and, after failing to obtain a stay, offered employment to Ms Wardley as a pilot. Ms Wardley was a member of the Australian Federation of Air Pilots which had obtained the certified agreement with Ansett under the provisions which created the Flight Crew Officers Industrial Tribunal. In the High Court, Ansett argued that as it was now unwillingly employing Ms Wardley as a trainee pilot it could nevertheless lawfully dismiss her upon the openly avowed ground that she was a woman although to do so would contravene the terms of the State Act. Ansett argued that an agreement certified under the Conciliation and Arbitration Act covered pilots in relation to dismissal. The Equal Opportunity Act significantly altered rights established by the certified agreement, and the agreement covered the field of employment or the field of the right of the employer to dismiss and deal with any objections pilots could make to dismissal.

51 Stephen J noted that the employer argued that there was a direct conflict arising from the present circumstances - what was permitted by the Commonwealth law was forbidden by the State law. His Honour preferred to focus on the real effect of Clause 6 of the Agreement. In his Honour's view, Clause 6 of the Agreement did not operate regardless of unlawfulness under State law: the Clause created a right in the employer to be understood against the background of the general law of the land both State or Federal.

52 Dealing with the nature of the certified agreement Stephen J stated (at 247): The present industrial agreement, made in settlement of an industrial dispute, is concerned with industrial matters and its terms should be construed accordingly; they should not be regarded as trespassing upon alien areas remote from its purpose and subject matter, whether those areas concern the nation's foreign affairs or social evils such as discrimination upon the ground of sex. When the power of termination which cl 6 confers upon the parties to the contract of employment comes to be construed it can be seen to contain nothing in its quite unexceptional wording to suggest that it should stand inviolate, unresponsive to a general law applicable to the community at large and directed to the prevention of some evil practice, which, of its nature, may manifest itself in a variety of ways, including the exercise by an employer of his power of dismissal. The concern of the agreement is, after all, entirely unremarkable, being exclusively devoted to the settlement of an industrial dispute. This is an inherently improbably source in which to discover, in the form of a simple power to bring the contract to an end conferred upon both parties to a contract of employment, a right on the employer's part to practice discrimination upon the grounds of sex, contrary to, and immune from the prohibition of, State law.

53 In his Honour's view, the question was one of search for the legislative intent: both the agreement and the State Act broadly covered engagement and dismissal but they were essentially dissimilar both in character and in general content. The agreement did not deal with general social questions as to equality of opportunity between men and women or discrimination based on sex or marital status. For the same reasons, the agreement could not be construed as covering the field such that the State Act came into collision with the Commonwealth law.

54 Mason J noted that Ansett's argument was that this was a case of direct inconsistency: it could not obey both laws and it was the agreement which contained the absolute right to dismiss employees. This approach was considered in the context of the various tests which had been applied in s 109 cases with his Honour stating (at 260): As the various tests which have been applied by the Court are all designed to elucidate the issue of inconsistency it is not surprising that they are interrelated and that in a given case more than one test is capable of being applied so as to establish consistency. Especially is this so when it is the giving of a permission or the grant of a right by Commonwealth law that is the foundation of a claim of inconsistency. If, according the true construction of the Commonwealth law, the right is absolute, then it inevitably follows that the right is intended to prevail to the exclusion of any other law. A State law which takes away the right is inconsistent because it is in conflict with the absolute right and because the Commonwealth law relevantly occupies the field. So also with a Commonwealth law that grants a permission by way of positive authority. The Commonwealth legislative intention which sustains the conclusion that the permission is granted by way of positive authority also sustains the conclusion that the positive authority was to take effect to the exclusion of any other law. Again it produces inconsistency on both grounds: cf Airlines of New South Wales Pty Ltd v New South Wales (1965) 113 CLR 54), where the permission for which the Commonwealth law provided was neither absolute nor comprehensive. Inconsistency between a Commonwealth award or an agreement having the force of an award and a State law involves special consideration. They were discussed in Robinson (TA) & Sons Pty Ltd v Haylor (1957) 95 CLR 177 at pp 182 - 183), and they explain the presence of Section 65 in the Act. In truth the case which Ansett makes is one of inconsistency between the Act and the State Acts, Section 109 giving paramountcy to the Act with the result that the State Act cannot operate if, pursuant to the Act, the Commission has exercised its power to the exclusion of provisions made by the State law on the topic. The issue therefore turns upon the interpretation of the Agreement and, despite the emphasis given to the claim of direct inconsistency, the question is whether the provisions of the Agreement were intended to operate, subject to, or in disregard of, the general law.

55 Viewing the agreement as a whole, Mason J concluded that it was not a general industry award seeking to determine exhaustively the respective rights of employer and employee. This agreement contained some matters usually found in an award but there was an emphasis on seniority and advancement. Clause 6B did not invest in the employer an unfettered right of dismissal - rather, it sought to regulate periods of notice assuming a right to dismiss under the general law. That general law had been altered by the Victorian Act and the agreement had to be read in the light of that alteration to the general law. On this analysis the agreement did not seek to cover the field.

56 Murphy J was also of the view that no inconsistency arose. The agreement did not give an unqualified right to the employer to terminate employment and those provisions in the agreement were subject to the provisions of the general law, that is, the common law as modified by any Act including a State Act.

57 Wilson J also made observations about the nature of a general award and stated (at 287): It will be seldom, in my opinion, that an award will lend itself to the "covering the field" test of inconsistency on the subject of the contract of employment. Few, if any, awards reflect an intention to express completely, exhaustively or exclusively the law governing that contract between the parties. It will generally be a case of specific provisions which will, of course, have the effect rendering inoperative any provisions of subordinate law, whether common law or statutory, touching that employment with which they are inconsistent. In Reg v Industrial Court of South Australia; ex parte General Motor-Holden's Pty. Ltd. (1975) 10 SASR 582 at 599 Walters and Wells JJ, in a passage with which I respectfully agree, discuss the relationship of an award to the common law and to statute law and refer to approval to the following passage from Webb: Industrial Relations and the Contract of Employment (1974), p.21: The significance of the common law can be recognised if contracts of employment are seen to be stratified. First, there is a foundation strata being the common law. Superimposed on this are State Acts, regulations and State industrial determinations; in places such State law cuts through and replaces the common law foundational strata. Above this again are Commonwealth Acts, regulations and awards of the Arbitration Commission. Federal law cuts through State law in places, sometimes at the point where State law has already cut through common law, sometimes direct into common law. His Honour saw the task as to examine the two pieces of legislation in question, mindful to secure to the paramount law that full and free operation which its proper construction required. Nevertheless, his Honour was of the view that the certified agreement did not deal with sex discrimination but dealt with notice where there was termination of employment. It was significant that the Victorian Act did not deny or vary a right, power or privilege conferred by the certified agreement nor did it grant employees a right denied by the agreement.

58 As earlier indicated, the respondent in its submissions dealing with inconsistency referred to the judgment of the High Court in Telstra v Worthing. That case dealt with legislation governing the operations of AOTC, Telstra and its successors and the interaction of the Workers Compensation Act 1987 (NSW) and similar State legislation. The Court dealt with the principles in paragraph 27 and following: 27. The applicable principles are well settled. Cases still arise where one law requires what the other forbids. It was held in Wallis v Downard-Pickford (North Queensland) Pty Ltd (1994) 179 CLR 388 at 398) that a State law which incorporated into certain contracts the terms which the law of the Commonwealth forbade was invalid. However, it is clearly established that there may be inconsistency within the meaning of s 109 although it is possible to obey the Commonwealth law and the State law (Viskauskas v Niland (1983) 153 CLR 280 at 291 - 292). Further, there will be what Barwick CJ identified as "direct collision" where the State law, if allowed to operate, would impose an obligation greater than that for which the Federal law has provided … thus, in Australian Mutual Providence Society v Goulden (1986) 160 CLR 330 at 339), in a joint judgment, the Court determined the issue before it by stating that the provision of the State law in question would qualify, impair and, in a significant respect, negate the essential legislative scheme of the Life Insurance Act 1995 (Cth). A different result obtains if the Commonwealth law operates within the setting of other laws so that it is supplementary to or cumulative upon the State law in question (ex parte McLean (1930) 43 CLR 472 at 483; Commercial Radio Coffs Harbour v Fuller (1986) 161 CLR 47 at 57-58). But that is not this case. 28. In Victoria v The Commonwealth (1937) 58 CLR 618 at 630), Dixon J stated two propositions which are presently material. The first was: When a State law, if valid, would alter, impair or detract from the operation of a law of the Commonwealth Parliament, then to that extent it is invalid. The second, which followed immediately in the same passage, was: Moreover, if it appears from the terms, the nature or the subject matter of a Federal enactment that it was intended as a complete statement of the law governing a particular matter or set of rights and duties, then for a State law to regulate or apply to the same matter or relation is regarded as a detraction from the full operation of the Commonwealth law and so as inconsistent. The second proposition may apply in a given case where the first does not, yet, contrary to the approach taken in the Court of Appeal, if the first proposition applies, then s 109 of the Constitution operates even if, and without the occasion to consider whether, the second proposition applies.

59 The Court of Appeal had conducted an analysis in Worthing's case which demonstrated that the State Act provided superior benefits for the same injury than under Federal legislation. That situation alone, said the High Court, was sufficient to establish inconsistency within s 109 of the Constitution. However, the Court of Appeal went on to consider whether the Federal legislation "covered the field" and saw indications in the legislation which indicated that it did not do so. In any event, the High Court also determined that the Court of Appeal was wrong about the Federal legislation not "covering the field".

60 In argument, reference was also made to the decision in Blackley v Devondale Cream (Vic) Pty Ltd (1967-68) 117 CLR 253. In that case, a determination of a Victorian State Wages Board prescribed minimum wages payable to employees who were also covered by an award made under the Conciliation and Arbitration Act 1904-1961, which prescribed minimum rates at a lower level. It was attempted to be argued that because the Federal award could not be enforced by non-unionists, there was no direct conflict and that the State award may give non-union employees rights against thier employer which imposed upon the employer different and larger obligations than those laid upon him by the Federal Act and the award made under it. The minimum wage nature of the Federal award was not regarded by Barwick CJ as affecting the issue of inconsistency: the award prescribed the wage which was the largest wage which the employer was required by the Act and the award to pay. The award clearly intended to cover the field exclusively and exhaustively in regulating the obligations of the employers bound by the awards or their employees as to all matters within the ambit of the dispute in settlement of which the award was made. McTiernan J concurred in the judgment of the Chief Justice while Taylor and Menzies JJ, in separate judgments, reached conclusions similar to the manner in which the Chief Justice decided the case.

61 A review of the relevant authorities would not be complete without reference to the recent decision of a Full Court of the Commission in Court Session in Barry v The Australian Broadcasting Commission [2002] NSWIRComm 14. Although that case involved conflict between s 106 of the Act and s 32 of the Australian Broadcasting Corporation Act 1983 (Cth) rather than conflict with an award or industrial instrument made under Commonwealth legislation, the discussion is relevant to the present matter.

62 Counsel for the applicant in Barry had emphasised the approach of Dixon J (with whom Rich J agreed) in Ex parte McLean (1930) 43 CLR 427 at 483, that an inconsistency: … does not lie in the mere co-existence of two laws which are susceptible of simultaneous obedience. It depends upon the intention of the paramount Legislature to express by its enactment, completely, exhaustively or exclusively, what shall be the law governing the particular conduct or matter to which its attention is directed. The further explanation of that principle by Dixon J in Victoria v The Commonwealth has been referred to earlier. The Full Court was able to conclude that, although the Federal legislation was not detailed, High Court authority required a conclusion that the legislative intent was that the provisions of the Federal Act such as they were, nevertheless, were intended to cover the field and left no room for orders to be made under s 106 of the Act.

63 The Full Court, after considering the nature of the Federal Act and its provisions, then turned its focus to the nature and operation of s 106, stating: 24. Section 106 of the State Act has about it all the appearances of a provision quite different in substance to that contained in Pt V of the Commonwealth Act. The section is concerned to confer power on this Court to deal with a particular aspect of the industrial relationship, albeit one of general application, namely, unfair contracts whereby a person performs work in an industry. The nature of the power so given has been the subject of much judicial attention over the years and was recently re-stated by the Full Bench in Reich v Clients Services Professionals (49 NSWLR at pp 561-562; 99 IR at pp 77-78 in para [19]) as follows: Given the definitions of 'contract' and 'unfair contract' in Section 105, the power exercisable by the Court under s 106 is to 'make an order declaring wholly or partly void, or varying any contract whereby a person performs work in any industry if the Commission finds that the contract is an unfair contract: sub-s(1). The impugned transaction (contract or arrangement, or any related condition or collateral arrangement) may be found to be unfair 'at the time it was entered into or that it subsequently became an unfair contract because of any conduct of the parties, any variation of the contract or any other reason': sub-s(2). A declaration of avoidance or an order of variation may be made 'either from the commencement of the contract or from some other time': sub-s(3). Where an order is made under the section, a further order may be made 'as to the payment of money in connection with any contract declared wholly or partly void, or varied, as the Commission considers just in the circumstances of the case' sub-s(5). In the earlier case of Huskisson RSL Sub Branch Club Limited v Sullivan (1990) 20 NSWLR 332 at p 345: [1990] 32 IR 404 at p 414, the former Industrial Commission in Court Session (Fisher P, Hill and Hungerford JJ) dealt with the scope of Section 88F of the Industrial Arbitration Act 1940, the statutory predecessor to the present Section 106 and relevantly in the same terms, to this effect: The subject matter of Section 88F may be broadly characterised as dealing with the rights of a party or an interested person:

(i) have declared or varied any contract or arrangement (whereby work is performed in an industry) which is unfair, harsh or unconscionable, or against the public interest, or which provides to a person less remuneration than an employee would have received for performing the work in question, or is designed to or does avoid the provisions of an award or industrial agreement; and (ii) to recover any losses connected with such contract or arrangement; The Commission is vested with a discretion under Section 88F(2) as to the making of an order for the payment of any monies in connection with any contract or arrangement declared void or varied. 25. It is to be emphasised, therefore, that the subject matter of Section 106 is directed to a contract answering the relevant description as to the performance of work which is found to be an unfair contract on the specified grounds so as to enable the Court to declare it void or to vary it and to order the payment of money for the recovery of losses connected with such avoided or varied contract. In other words, it seems clear to us, on the ground of unfairness being established, the subject matter of the section essentially relates to the power to make an order as affecting the challenged contract so as to adjust its terms to remedy the unfairness found. It need only be added, by reason of sub-s(2) of s 106, that a contract may be found as unfair at the time it was entered into or that it subsequently became unfair because of any conduct of the parties, any variation of the contract or any other reasons. 26 . Having in mind the subject matter so identified, the legal operation or form of Section 106, again adopting the analysis of Brennan CJ in Residential Tenancies Tribunal (190) CLR at p 426) in assessing the existence of inconsistency, was comprehensively reviewed by a Full Bench of the Court in Beahan v Bush Boake Allen Australia Limited (1999) 47 NSWLR 648 at p 685; (1999) 93 IR 1 at p 35 in this way: What emerges from the above authorities, we think, is the now settled view that s 106 (as with the previous Section 88F of the 1940 Act and Section 275 of the 1991 Act) is directed to an impugned contract of employment, whether existing or terminated, as to the fairness of its express or implied terms. Such unfairness will depend upon the facts of each particular case by focusing attention on the contractual relationship between a particular employer and employee and where the unfairness might arise from the terms of the contract itself, the surrounding circumstances and/or the manner of performance or operation of the contract. The Section, we emphasise, is not concerned with re-establishing an employment relationship which has ended nor with compensating an employee for the loss of his employment contract. In other words, the Section is properly concerned with the fairness of the terms of a contract of employment in its various respects, and if relevantly found to be unfair, to provide remedial relief by avoiding or varying the terms of that contract and to order the payment of money in connection with any contract so avoided or varied as is considered just in the circumstances of the case. 27. In summary, the subject matter of Section 106 is the power of the Court in relation to a relevant contract, including as here, a contract of employment, as being one whereby work is performed in any industry. The operation of the Section on the ground of unfairness being found is to declare the subject contract void or to vary it and to make an order for the payment of money in connection with the contract so declared void or varied. Howsoever one views Section 106, either in substance or in form, it is clear that an inherent and fundamental aspect is the contract itself as to its terms and conditions, including any adjustment thereof. The payment of money in connection with the contract so declared void or varied is dependent upon such a declaration being made: see Tana v Baxter (1986) 160 CLR 527 at p 578 and BMY Australia Ltd v James (1992) 26 NSWLR 57 at pp 83, 95; [1992] 40 IR 1 at 25,38. Also, any order for the payment of money is to be one with a necessary connection with the contract: see Brown v Rezitis (127 CLR at pp 166, 170). The subject matter of Section 32 is the arrangement put in place for the staffing of the respondent to enable to it to perform its functions and to exercise its powers. The operation or form of the Section is to empower the respondent itself to engage such employees as are necessary for the purpose and to require it to determine the terms and conditions of employment of the employees so engaged. Central to Section 32, therefore, are the terms and conditions of employment, or, in other words, those matters forming the contract of employment. 28. It follows, in our view, that although the competing sections are different in substance, and in the way they operate, central to both is the contract of employment as to the terms and conditions of employment.

64 The Full Court pointed out the difficulties that arose with the various approaches to inconsistency as highlighted by the separate judgments of the High Court in Australian Broadcasting Commission v Industrial Court (SA) (1977) 138 CLR 339. On analysis, it appeared that, while all of the Members of the Court were of the view that the State statute impermissibly intruded upon the Federal legislation, two of the Justices thought that result flowed from direct inconsistency while three Justices (and in part a fourth) thought the inconsistency arose indirectly by application of the cover the field test. In that case, Murphy J made the additional point that, where the Federal law is on a topic of "dominant Federal interest", an intention to legislate exclusively, if not express, will generally be implied. Thus, the industrial relations of Commonwealth agencies and instrumentalities, particularly ones operating nationwide, were of dominant Federal interest.

65 It is of interest that, in its conclusions, the Full Court made the following comparison: 43. It should be explained, in light of Mr Shaw's submissions in seeking to distinguish Australian Broadcasting Commission by its different subject matter and statutory provisions, we see no relevant distinction between Section 15(1)(e) of the South Australian statute and Section 106 of the State Act here. The former, it is true, was concerned with unfair dismissals and the latter with unfair contracts, but whilst the subject matter and purposes may differ it is plain that the process in giving effect to the respective schemes is conceptually similar - first, a finding of unfairness; second, a declaration or order which affects the terms of the employment; and third, an order for the payment of money in connection with the second step of the process. Also, the effective similarity in terms between the power granted to the Australian Broadcasting Commission by Section 43(2) and (6) in relation to the engagement and determination of the terms and conditions of employment for temporary employees and that granted to the respondent here by Section 32 of the Commonwealth Act is obvious. The reasoning of the High Court in Australian Broadcasting Commission is, therefore, directly in point, and so to, we would conclude, the circumstances in Dao have conceptual similarity to the case before us.

66 Some mention should also be made of the decision of the Full Industrial Court in ICI Australia Operations Pty Ltd (t/as Dulux Australia) v Hutton (1993) 47 IR 288. In that case, an issue arose as to inconsistency between an order under the State Act (s 88F) and the Federal award governing the employment. The claim had been made that the contract of employment was unfair in that it did not provide for redundancy payments. The Full Court noted that clauses of the Agreement were similar to those found in Wardley, were not very comprehensive in their terms, and seemed to be directed to the subject of notice. In rejecting the challenge based upon inconsistency the Full Court, at page 309, stated: Section 88F gave power to the Commission to avoid or vary contracts or arrangements including contracts and/or arrangements of employment and was restricted to the circumstances of the particular contract or arrangement involved. Section 88F did not provide a vehicle for general changes to employment conditions. The legislation considered in Wardley was characterised as dealing with social questions in contrast to 'being narrowly confined to employment relationships determined in the settlement of an industrial dispute'…; the same might also be said about legislation such as Section 88F which deals with the unfairness, harshness and unconscionability of a particular contract or arrangement. 67 Apart from the cases dealing with inconsistency referred to above, it is appropriate to consider the observations made by the Full Bench in Westfield Holdings v Adams (2001) NSWIRComm 293, in dealing with the general nature of s 106 of the Act and the nature of the orders which may be made following a finding of unfairness. It was accepted that s 106(5) provided a wide power to grant compensation which was not limited by common law concepts of assessment of damages. The breadth of the provision, when it was s 88F, was described by Barwick CJ in Stevenson v Barham (1977) 136 CLR 190 at 192, in the following terms:

… the language of Section 88F of the Act is intractable and must be given effect according to its width and generality. Reference is also made to the famous judgment of Sheldon J in Davies v General Transport Development Pty Ltd [1967] AR NSW 371 at 374, in which his Honour said of Section 88F(2): By adding sub-s(2), it gave the Commission power, when avoiding or altering a transaction to 'make such orders as to the payment of money … as may appear to the Commission to be just in the circumstances of the case. Not only can no wider discretion by conceived, but the whole subject of right and remedy under this section was thus committed exclusively to the Industrial Tribunal'. In relation to the width of the power available, a Full Bench of the Industrial Court in Barclays Australia Investments Services Ltd v Nordby (1995) 99 IR 258 at 279 said: The task of assessing a 'just' monetary amount is one which, not infrequently, involves the exercise of a broad judgment without the assistance of defined and identifiable parameters or heads of loss or damage.

68 Similarly, the Full Industrial Court in State of New South Wales v Health and Research Employees Association of New South Wales (unreported, Fisher CJ, Bauer and Hill JJ, 31 March 1993) stated: It is clear that an instruction for the payment of a sum ' just in the circumstances' in Section 88F(2) has a wider base than that generally available under the principles of common law damages. Indeed, the existence of Section 88F indicates that the legislature found that common law remedies are not necessarily appropriate and it seems to follows, insofar as argument by analogy might be useful, that though persuasive, reliance solely upon common law rules as to 'damages' may well be inappropriate. Further, Kirby P in Walker v The Industrial Court of New South Wales (1994) 53 IR 121 at 135 said: The High Court of Australia, and this Court, have repeatedly stressed the very wide discretion conferred by Section 88F upon the former Industrial Commission (and now the Court). Once Section 88F(1) attaches, the remedies that are then at the disposal of the Commission (now the Court) are also extremely wide. There is no warrant for confining this very large power, or for narrowing the circumstances of its exercise, except as statute provides …

69 Also noted was the judgment of the Court of Appeal in Incitec Ltd where the following was said about the nature of s 88F: Section 88F is concerned with alleged unfairness or harshness or unconscionability of individual contracts of employment. The focus of attention is the contractual relationship between a particular employer and employee. The Employment Protection legislation, concerned, as it is, with the matter of awards and industrial agreements, directs attention to more general industrial issues. Hill J, said, in his judgment at first instance (Barry v Incitec Ltd (1991) 45 IR 146: On the other hand Section 88F of the Act deals with the matter of what for present purposes may be briefly described as unfair contracts. It applies to a contract or arrangement between the particular persons who are a party thereto. Unfairness may arise either from the terms of the contract itself, the surrounding circumstances, and/or from the manner of performance or operation of the contract. The section deals largely with private rights inter partes. Despite the general and relevant industrial prescription governing benefits payable to employees in termination of employment situations may exist, unfairness in relation to a particular contract or employment may nevertheless arise if the situation of redundancy or termination of employment for reasons unrelated to or not relevant to the basis of award prescription of an objective and fair benefit. It may arise simply in the special circumstances of and surrounding the particular contract.

70 The Full Bench then dealt with principles which were appropriate to be applied under s 106(5) of the Act and raised the following matters: 161. … (4) Any order shall be what the Commission considers just in the circumstances of the case. While such orders should not be limited by drawing some analogy with contractual, tort or equitable remedies it is proper to have regard to the common law or equitable principles, but recognising that in particulars cases those principles may be inappropriate … (8) … ultimately, the relevant guiding principles for the Commission in Court Session under s 106(5) is not confined to a question of what loss or damage an aggrieved party has suffered but rather a wider test, namely, what is just in the circumstances of the case. (9) In assessing whether unfairness has occurred and in making money orders under s 106(5) it would be appropriate to have regard to the following principles regarding the relevance of general industrial standards. In doing so, however, the individual contract or arrangement concerned remains the primary consideration: (a) whether or not a contract or arrangement is unfair within the meaning of Section 105 and 106 is a matter to be decided upon examination of the facts of each particular case; Section 106 deals largely with private rights inter partes; the focus of attention is the contractual relationship between a particular employer and employee. (b) subject to the primary focus being the particular circumstances of the individual contract or arrangement concerned, in assessing whether unfairness has occurred, general standards or levels of what is considered to be fair, including general standards of redundancy pay applying to employees covered by industrial awards or legislation, will be factors to be considered. (c) despite that a general and relevant industrial prescription governing benefits payable to employees in termination of employment situations may exist, unfairness in relation to a particular contract of employment may nevertheless arise in the situation of redundancy or termination of employment for reasons unrelated to or not relevant to the basis of award prescription of an objective and fair benefit …

PROVISIONS OF THE CONTRACT, THE AGREEMENT AND THE AWARD 71 It was accepted by counsel for the respondent that there was a separate contract of employment operating alongside a Federal instrument whether it be an agreement or an award, although he submitted that nothing turned on that fact. Bearing in mind the early stage at which this point is taken, however, the terms of the contract warrant attention. In paragraph [5], I summarised the matters covered by the offer of employment which when signed (as it was in this case), appeared to have become the terms of the contract of employment. It is clear that Clause 5 dealt with termination of employment and provided for the applicant's employment to be terminated "in accordance with the notice requirement set out in the Endeavour Credit Union Enterprise Agreement 1997". In these terms the provision merely deals with notice by incorporating the notice provisions of the agreement. As earlier indicated, the applicant's position was by the letter of offer an exempt position under Clause 6 of the Endeavour Credit Union Enterprise Agreement 1997, meaning that conditions of employment, relieving in higher and lower grades, hours of work, Sunday work, payment for public holidays and rostered days off under the agreement did not apply to her, nor did stand by/call back allowances, overtime, travel expenses, preference and shift work under the award apply to her. The letter then noted that all other terms and conditions of employment would be covered by the Endeavour Credit Union Enterprise Agreement 1997 and the Credit Union Award 1998. A question arises as to what this position meant in relation to Clause 5 of the offer of employment. On one view, Clause 5 appears to deal with the subject of termination of employment but only makes provision for termination to be in accordance with the notice requirements set out in the agreement. The question arises: Does the contract thus deal with the termination of employment exhaustively, even though only choosing to regulate notice requirements and leaving the termination of employment open to the operation of the general law, or does the clause operate only in relation to the notice provisions leaving the other provisions in relation to termination to be found in the agreement and the award? This last possibility seems less likely because there would be little or no point in making the specification in Clause 5 at all. To my mind, Clause 5 has the appearance of intending to incorporate only the notice requirements of the agreement, excluding the other requirements as determined in the agreement and the award (so far as that was possible at law), thus leaving termination of employment open to the operation of the general law.

72 Reference has also been made to the EACU Redeployment and Redundancy Policy, extracts of which were provided to the applicant on termination. That document apparently was meant to be contractual in nature although how that arose has not yet been established on any evidence currently available to the Court. That document lists a number of definitions for "redundancy" and "redundancy package" and defines the award to mean the Credit Union Award of 1998 and the agreement meaning any current agreement certified by the Federal Commission which governs the terms and conditions of employment of staff with EACU. The policy deals with issues of redeployment, notice periods, the composition of the redundancy package and also payments of annual leave, long service and superannuation. The document says that any disputes arising out of the interpretation, application or operation of this "agreement" are to be settled pursuant to the Dispute Settlement Procedures described in EACU Human Resources Policy and the "SCC Terms of Reference". The "SCC Terms of Reference" do not seem to be contractual in nature but reflect the respondent's policy. The effect of the policy is difficult to establish especially since the letter of offer required the applicant to sign that offer "… in acknowledgement of the above terms and conditions of employment". There is nothing in that letter of offer which refers to the application of the respondent's policies. Adding to the confusion, the letter of termination informed the applicant that "… a redundancy package payment will be paid in accordance with EACU policy". The attached sheet details the redundancy payment amounts. It seems strange that the letter of termination does not refer to either the contract of employment or to the terms of the agreement or the award but pays the applicant "in accordance with EACU policy". The confusion is heightened by the fact that the calculation sheet which apparently accompanied the letter of termination carries a heading "Redundancy calculation as per EACU redundancy agreement". It then refers to other payments under annual leave and long service leave.

73 The Endeavour Credit Union Limited Enterprise Agreement, 1997 by Clause 1, bound the Credit Union, its employees and the Finance Sector Union. By Clause 2(a), the agreement was to be read in conjunction with the Credit Union Award 1992 with the agreement to prevail to the extent of any inconsistency between the two documents. Clause 11 of the Agreement dealt with termination of employment and initially sets out periods of notice by reference to years of service. Clause 11 however is subject to any other arrangement for notice of termination which has been mutually agreed between the Credit Union and the employee or specified elsewhere in the agreement. It is to be noted that here that the letter of offer which contained the conditions and terms of employment picked up the notice provisions of the agreement. Clause 11 then contains a provision that the employer may terminate employment by any combination of notice and payment in lieu of notice; that, in calculating the payment in lieu of notice, the actual rate of pay that the employee would have received in respect of ordinary time that he/she would have worked during the period of notice would be paid; that the period of notice in the Clause would not apply to employees engaged for a specific period or for a specific task or tasks; that casual employees could be terminated without notice; that where an employee had been terminated for serious and wilful misconduct the notice periods would not apply; and concludes that for all other matters related to termination of employment "reference should be made to the relevant clause in the Workplace Relations Act 1996 or any instrument that varies it." Bearing in mind the discussion in a number of the High Court cases including Wardley , Clause 11 does not appear to provide a particular power of termination but provides various notice periods and excludes certain classes of persons from notice periods. Thus, on its face it appears to leave the matter of termination to the general law.

74 Annexure 1 appears to provide for salary increases at specified dates and sets out a grading structure and salary scale. Annexure 2 is headed "Redeployment and Redundancy Agreement". As earlier indicated the Redeployment and Redundancy Agreement is specified to apply to members of the FSU employed by the Credit Union as full time or part time employees. It seems that, as a separate category, the agreement was also to apply to employees recruited for a fixed term or specific project except that an officer would not be deemed to be redundant at the scheduled completion of that period of employment. In Clause 5 of this annexure, provision is made for notice to enable consultation where retrenchment situations arise. Clause 6 provides severance payments where there is "termination through retrenchment" with a payment of a special lump sum severance payment to be "full settlement of all claims for additional notice, retrenchment pay etc" calculated by reference to provisions which then follow.

75 The Credit Union Award 1992 as varied in November 1998 appears to have been varied having regard to the award simplification decision of the Industrial Relations Commission, and issued on 23 December 1997. It became known as the Credit Union Award 1998. The award was binding on all employers named in the respondents' schedule (which included the respondent in the proceedings in this Court) and did so in relation to all their employees and on the Finance Sector Union of Australia. The award superseded and rescinded the Credit Union Award 1992. The award provided for annual leave but long service leave in New South Wales was to be governed by the Long Service Leave Act 1955 (NSW). By Clause 11, minimum rates of salary were provided. Clause 17 under the heading "Termination, Change and Redundancy" provided for notice of termination calculated by reference to years of service. Again, the clause seems to address primarily issues of notice rather than specifying the circumstances in which the employer may exercise the power of termination. The clause also dealt with redundancy and severance pay arising from redundancy, although these payments were not to be made where employment was terminated as a consequence of conduct justifying instant dismissal including malingering, inefficiency and neglect of duty, nor were they to apply to cases of casual employees, apprentices or employees engaged for a specific period of time of a specified task or tasks.

76 The respondent also appeared to rely on the 1992 Award although, in part, that may have been merely a matter of award history. The 1992 Award had been rescinded by the time the applicant commenced employment in June 2000 and the applicable award at that time was the 1998 award. Indeed, as earlier recorded, the offer of employment which became the terms and conditions of employment noted that, for all other matters expressly set out in that letter, the terms of the Enterprise Agreement 1997 and the 1998 would apply. Although not mentioned by the respondent, Clause 27 of the 1992 Award dealt with terms of engagement. This clause dealt with casual employment and the ability of the employer to direct employees to carry out work within their skills. The clause also provided some exemptions from other provisions of the Award. This clause made no provision in relation to the employer's right to terminate full time employees such as the applicant. Clause 40 dealt with termination, change and redundancy and provided that a termination of employment by an employer should not be harsh, unjust or unreasonable. In relation to redundancy, the clause dealt with discussions before termination and notice calculated by reference to years of service. This clause appears to operate on the basis of the employer exercising its rights of termination in accordance with the general law and then deals with the consequences of such a decision.

DELIBERATION 77 From the various cases which have been reviewed it may be said that the following matters provide guidance as to whether there is an inconsistency between a Federal award and a State enactment such as s 106 of the Act: (a) firstly, take the law or award with which the State law is allegedly inconsistent and discern precisely the matter which it is the intent of the Parliament or the Commonwealth arbitrator are to be exhaustively determined thereby; (b) where an award is involved dealing with a dispute between parties whose relations apart from the award are ordinarily governed by State law including the common law, the existence of the State law is for the most part assumed and the assumption will be relevant to discerning any inconsistency.; The contract of employment itself is the most obvious illustration - to the extent it is not varied by the award its obligations will ultimately be derived from State law; (c) the distinction between the right to dismiss and the machinery for termination may be material; (d) the industrial agreement and the State Act may deal with entirely disparate subject matters - an industrial agreement is confined narrowly to employment relationships determined in settlement of an industrial dispute while legislation may deal with a separate and distinct matter dealing with a general social question of equality; (e) the critical question is - what is the conduct or matter with which the relevant award deals?; (f) even where there are comprehensive awards there may be some matters which are left to the operation of State laws; (g) awards usually operate in the context of the general law both State and Federal. Where an award fails to deal with a matter provided for by Statute, unless the award exhibits an intention there is to be no benefit of that kind or alternatively that the benefit for which it provides are to be a complete and exclusive statement of the employee's entitlement in the relevant area, there will be no inconsistency. Such an intention cannot be ascribed lightly to an award; (h) generally statutory rights have been treated as standing outside the matters dealt with by awards unless a specific provision is made with respect to them; (i) as a general rule inconsistency will not arise simply because the Federal award regulates a particular employment in respect of which an order may be sought under s 88F(1) varying the award or under Section 88F(2) rectifying or adjusting the arrangements by payment of a money sum; (j) the special nature of Section 106 is such that it is highly unlikely that there would be inconsistency with the Federal award; (k) the Federal award is to be examined to see if it operates regardless of State law; (l) awards are not to trespass on alien areas remote from its purpose and subject matter; (m) while an award may be broadly similar in coverage of the engagement and dismissal, it may be essentially dissimilar in character and general content to a statutory provision; the award may not be a general industry award dealing exhaustively with the respective rights of the employer and employee and claiming an unfettered right of dismissal - in such circumstances there is room for the operation of the general law; (n) seldom will an award lend itself to the covering of the field test on the subject of the contract of employment; (o) inconsistency depends upon the intention of the paramount legislature to express by its enactment completely, exhaustively or exclusively, what shall be the law governing the particular conduct or matter to which attention is directed.

78 Having regard to these matters I am unable to accept the respondent's submission that, at this stage of the proceedings, it can be demonstrated that there is relevant inconsistency between the certified agreement or the award and the orders which may be made under s 106 in this matter.

79 There is persuasive authority in this jurisdiction that the nature of s 106 is so dissimilar to the award making power and the purpose behind the exercise of that power that, similar to the approach in Wardley, it cannot be said that orders made for the payment of money under s 106 are an abrogation of any right or obligation under the Federal award. That different purpose is highlighted by the discussion conducted by Priestley JA in Renard Constructions (ME) Pty Ltd v Minister for Public Works (1992) 26 NSWLR 234. His Honour dealt extensively with the development of "good faith" provisions being implied into contractual arrangements and how there had been a steady movement towards such a recognition. Developments in New South Wales included statutes permitting courts to remould particular kinds of contracts in the interest of fairness, with specific reference to s 88F of the Industrial Arbitration Act, the Moneylenders and Infants Loans Act 1905, the Hire Purchase Agreement Acts of 1941 and 1960, the Contracts Review Act 1980 the Credit Act 1984 and also the provisions of the Trade Practices Act 1974. His Honour then continued: Although each of these statutes dealt with carefully defined types of contract, in their totality they covered contractual situations affecting a great many people, so that, to repeat something I have said elsewhere, 'a very large area of everyday contract law is now directly affected by statutory unconscionability provisions carrying with them broad remedies. As the words used in the sequence of statutes show, the ideas of unconscionability, unfairness and lack of good faith have a great deal in common. The result is that people generally, including Judges and other lawyers, from all strands of the community, have grown used to the courts applying standards of fairness to contracts which are wholly consistent with the existence in all contracts of a duty upon the parties of good faith and fair dealing in its performance. In my view this is in these days the expected standard, and anything less is contrary to prevailing community expectations . In my view that passage emphasises the distinctly different and separate field occupied by s 106 of the Act compared with the award making functions and agreement certifying functions of the Workplace Relations Act. In no sense are orders under s 106 dealing with award making or agreement making for a specified class of employees: the section is not a vehicle for general changes to employment conditions, does not provide for re-instatement and does not provide compensation for the loss of an employment contract. Nor would an order in these proceedings, as suggested by the respondent, provide terms and conditions of employment. As has been pointed out in the cases referred to earlier, the focus of s 106 is upon the contract of employment and usually involves litigation inter partes: its field of operation is contractual unconscionability. This position is further emphasised by the fact that s 105 defines "contract" to exclude an industrial instrument, albeit made under the Act. 80 Nor can I ignore the effect of the judgment in Byrne v Australian Airlines Ltd. Contrary to what might have been the understanding of industrial lawyers for many years, it is now clearly established that the contract of employment operates separately from an award or certified agreement and is not automatically subsumed into the contract of employment. Orders made under s 106, especially for the payment of money, are not in the nature of an award or the provision of an agreement. As the discussion in Westfield v Adams discloses, while concepts from the general law and general industrial standards may be relevant in reaching a determination on what money amount is just in the circumstances of the case, the result is not to order damages, nor does it simply amount to restitution or, for that matter, can it be considered the equivalent of making an "award" for the payment of more money. This will be so even if there is an award in existence and the Court has taken into consideration general award and industrial standards in arriving at the amount of money to be paid as being just in the circumstances of the case. All of those surrounding circumstances will not, ultimately, alter the true nature of the order made. As pointed out in Westfield v Adams, it is a mistake to treat the considerations which inform the determination of a money order which is "just in the circumstances of the case" as resulting in the Court ordering, in some strict legal sense, for example, damages in lieu of reasonable notice. Tests and approaches from various areas of the law may be utilised in the task of determining a money order. However, it masks the true nature of the exercise to simply equate those matters with an order "for notice" or "due to redundancy" or "for severance pay". The focus will always remain on the unfairness demonstrated to be associated with the contract impugned.

81 Approached on the basis of the judgments in Byrne v Australian Airlines Ltd, it may be said that the award alone (or certified agreement) is not the contract of employment. Section 106 deals with unconscionability associated with the contract of employment or any related arrangement, using that term broadly. It is for this reason, in my view, that orders made under s 106 of the Act would not usually be inconsistent with a law of the Commonwealth, namely the provisions of a certified agreement or award.

82 If a more particularised analysis is undertaken it appears that the award and the agreement are not comprehensive in nature and are not intended to cover the field. The provisions in relation to redundancy appear to be concerned primarily with notice. The award and the agreement also has the appearance of operating against the general law of which s 106 of the New South Wales Act forms a part.

83 A further matter to be considered in light of recent legislative developments is the nature of Federal award regulation. While it was appropriate for the court in the Metal Trades Industry Association case to describe, in 1982, the awards of the Federal Commission as being comprehensive in nature and regulating terms and conditions of employment in a detailed fashion, that description is no longer apt. The Workplace Relations Act 1996 brought about a most significant change. Section 89A limited, in a decisive way, the matters which may be contained in an award of the Commission. One of the principal objects of the Act was to ensure that the primary responsibility for determining matters affecting the relationship with employers and employees rested with the employer and employees at the workplace or enterprise levels. Awards were not only no longer to be comprehensive but were relegated to safety net arrangements to be supplemented by enterprise arrangements. In that context and having regard to the minimum rates nature of both the agreement and the award relied on by the respondent in these proceedings, it is not possible to say that there is a legislative intent that those instruments are to cover the field in relation to every subject matter with which they deal. Section 152 of the Workplace Relations Act will, therefore, not assist the respondent's argument. Amendments to s 152 made in 1996 and 1997 (and particularly the introduction of ss 1A) suggest that the field of exclusive coverage of federal awards has been considerably narrowed in comparison with the operation of s 65 of the Conciliation and Arbitration Act. Further, s 152 will not apply when the State law deals with a different matter, namely, the contract of employment at common law.

84 There are other difficulties which raise a significant barrier for the respondent's argument in these proceedings. There is no evidence at the moment that allows it to be determined that the applicant is covered by the certified agreement. The respondent is therefore left with the provisions of the 1998 minimum rates award covering in a limited way issues of termination by reference to notice. There is no material before the Court as to the scope of the dispute which may assist in determining whether or not the award is intended to cover the field and what field it is addressing. Even the field occupied by the contract of employment is unclear; on the present state of the evidence some provisions are confusing or contradictory. A further matter is the issue raised during argument by counsel for the applicant indicating that it may be appropriate to reframe the orders sought: the attack was not on the terms of the agreement or the award but concerned the representations as to permanency. All of these matters underline the wisdom of the approach of the Full Bench in Nagle v Tilburg and of Wright J, President in Virtue v New South Wales Department of Education and Training (1999) 92 IR 428 at 447 - 448 . In my view, it is too early to finally determine these issues raised by the respondent, notwithstanding the general observations I have made about the different nature of s 106 and the unlikelihood that there can be inconsistency with a Federal award or certified agreement. This approach is also consistent with the course adopted by Moore J in Mt Thorley Operations Pty Ltd v Burgess & ors (2001) 103 IR 184. His Honour, in that case, declined to make a declaration that relief sought under s 106 of the New South Wales Act would be inconsistent with the terms of an enterprise agreement on the basis that it would be premature to do so before this Court had made any orders in the proceedings: potential inconsistency could not arise until such orders were made. At an interlocutory stage in Burgess , Marks J adopted the same approach, stating that it would be premature to determine whether inconsistency arose until orders were made under the New South Wales Act.

85 To the extent that the respondent relies upon the provisions of s 170LZ and s 170CH of the Workplace Relations Act, further difficulties arise. Section 170LZ provides for certified agreements to "prevail over terms and conditions of employment specified in a State law …". Section 106 does not specify any term or condition of employment. It is also arguable that s 106 may be broadly described as a State law providing protection for an employee against harsh, unjust and unreasonable termination (see Barry at [43] as to conceptually similar approaches): and thus, pursuant to s 170LZ(3), sub-section(1) would not operate to affect the State law insofar as the two provisions could operate concurrently. Similar considerations arise in relation to s 152(1A). No final determination of this question is necessary in this case, especially in view of the unproven application of the certified agreement. In general, I also agree with the thrust of the comments made by Marks J in Burgess regarding s 170LZ and s 170CB, s 170CH and s 170GB of the Workplace Relations Act 1996 especially having regard to the terms of s 170HA and s 170HB. Further, it is significant that s 170LZ does not contain the words "or deals with a matter dealt with" as were found in s 152 of the 1988 Commonwealth Act and the present Workplace Relations Act

86 The appropriate order to make, in all the circumstances, is to refuse the orders sought in the respondent's notice of motion. I will hear the parties, in due course, in relation to the issue of costs.

ORDER 87 The respondent's notice of motion is dismissed.

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