McGrath v Government of New South Wales - TAFE Commission Division of the... [2012] NSWIRComm 129 | Case summary

Grounds of appeal 11The appellant's primary contention on the appeal, and the area of dispute between the parties, was that on and from 1 December 2011 (the date on which the amendments came into operation) he was not a member of staff of the New South Wales Government and, accordingly, the Commission did not cease to have jurisdiction to determine his application for relief under s 84 of the IR Act, whether pursuant to cl 16 of Sch 4 of the TAFE Commission Act, or otherwise. 12In written submissions, the parties identified a number of propositions about which there was no dispute. These have been extracted from the appellant's written submissions: a) prior to 17 October 2011, the appellant was employed by the NSW Government in its TAFE Commission division; b) on 17 October 2011, the NSW Government terminated the appellant's employment and the appellant ceased to be a member of staff of the NSW Government; c) on 4 November 2011, the appellant filed his application for relief, including reinstatement, against the NSW Government and the Industrial Relations Commission had jurisdiction to determine that application; d) on 1 December 2011, the Technical and Further Education Commission Amendment (Staff Employment) Act, 2011 ("the amending Act") commenced and made amendments to the TAFE Commission Act; e) the amending Act had the effect of introducing clause 16 of Schedule 4 into the TAFE Commission Act; f) clause 16 of the amending Act provided that on and from 1 December 2011, the Industrial Relations Commission had no jurisdiction to determine an industrial matter (which would include the relief claimed in the appellant's application) in respect of a member of staff of the TAFE Commission; g) clause 16 is the only basis upon which the NSW Government contends that the Industrial Relations Commission no longer has jurisdiction to determine the appellant's application. 13The appellant acknowledged that the amending Act did not contain any transitional provisions with regard to persons in his position, that is, persons dismissed from the respondent's employment prior to 1 December 2011 and who lodged a claim for relief against unfair dismissal under s 84 of the IR Act. The absence of any such transitional provisions was said to be explicable on the basis that the amending Act operated prospectively, that is, it applied only to persons who were existing staff members on 1 December 2011 and whose employment was transferred under cl 13(a) to the newly constituted TAFE Commission. In this regard, it was said that only by giving the amending Act retrospective effect could it "catch" former, or prior, employees. Such a construction, however, was said to be contrary to judicial authority which has steadily adopted the approach that retrospective operation will not be given to legislation if it has the effect of stripping away accrued rights unless the words are clear and unambiguous. 14In support of his contentions on the constructional issue, the appellant relied on the recent High Court decision of Australian Education Union v General Manager of Fair Work Australia [2012] HCA 19; (2012) 86 ALJR 595 ("Australian Education Union"), in particular, the following passages extracted from the reasons of French CJ, Crennan and Kiefel JJ at [30]: [30] ... In a representative democracy governed by the rule of law, it can be assumed that clear language will be used by the Parliament in enacting a statute which falsifies, retroactively, existing legal rules upon which people have ordered their affairs, exercised their rights and incurred liabilities and obligations. That assumption can be viewed as an aspect of the principle of legality, which also applies the constructional assumption that Parliament will use clear language if it intends to overthrow fundamental principles, infringe rights, or depart from the general system of law. The existence of those assumptions is, in the words of Gleeson CJ in Electrolux Home Products Pty Ltd v Australian Workers' Union [41]: "a working hypothesis, the existence of which is known both to Parliament and the courts, upon which statutory language will be interpreted. The hypothesis is an aspect of the rule of law." 15In reliance on the passage, the appellant sought to emphasise that he had rights as at the date of his dismissal and as at the date his application was lodged. It is only as a result of Ritchie C's finding in giving the amending Act retrospective effect that he is said to have no rights. Such a finding was available only if the words of the legislation upon which the finding purports to be based are clear and unambiguous. 16The appellant contended that he had an accrued right to have his application heard and determined at the date he applied for relief to the Commission. Ritchie C, therefore, fell into error in finding that the absence of transitional provisions evinced an intention on the part of the legislature to remove the jurisdiction of the Commission from 1 December 2011 with regard to persons, "who were or are" employed by the respondent. The true position, according to the appellant, is that the Commission's jurisdiction was removed on that date only with regard to employees who were transferred to the newly constituted TAFE Commission. 17As we have outlined above, the respondent did not challenge Ritchie C's findings that the appellant was not an existing staff member on 1 December 2011 and that his employment was not, and could not, be transferred under the transitional arrangements. 18The principal area of divergence between the parties emerges from the competing constructions of cl 16. According to the respondent, the Commission ceased to have jurisdiction from 1 December 2011 to determine an "industrial matter ... relating to a member of staff". Because the Commission was deprived of jurisdiction by the legislative amendments, it had no jurisdiction to further entertain the appellant's application. The transitional arrangements, according to the respondent, lend support to this construction. Although they operated to effect a transfer of the employment of existing employees, they also deprived the Commission of jurisdiction, except where jurisdiction was specifically preserved by cl 16(2), that is, in relation to matters the subject of an application under s 146B of the IR Act. The retention of the Commission's jurisdiction to deal with matters falling within s 146B was said to be a "powerful indicator" that the legislature was both aware of and took into account the relevant provisions of the Interpretation Act 1987 (relevantly, the preservation of rights following an amendment or a repeal of legislation) which the appellant relies upon to posit the existence of an accrued right. In contrast, the respondent contended, there is no express reference in cl 16 to rights accrued under s 84 of the IR Act. 19The respondent also disputed the contention that Ritchie C had wrongly construed the legislation as having retrospective operation. Instead, it was contended that the Commissioner had found the legislation had prospective operation. This contention was said to be supported by a simple illustration: if the appellant had had his claim dealt with before 1 December 2011 it could have been litigated under the existing regime. The effect of the legislative changes was to make that litigation impossible from 1 December 2011. In further support of the contention, the respondent pointed to amendments made to s 106 of the IR Act (the unfair contract provisions) which operated to limit, from a certain date, claims to persons with an income below a specific amount. If the claim had been made before that date the remunerative cap did not operate, but, it operated for claims after that date. Importantly, and in marked contrast to the present matter, the transitional provisions pertaining to the amendments to s 106 specifically permitted claims to continue to finality. It follows from this, it was said, that the complaint that the amendment adding cl 16 had retrospective operation, is wrong. 20The parties also addressed that aspect of Ritchie C's decision which proceeded upon the assumption of some residual power to determine the application if his findings as to jurisdiction were wrong. In that regard, Ritchie C examined what enforceable order, or orders, could be made in the event the Commission had residual power. Ultimately, he found that there was no power. His reasons appear at [39] of the decision extracted below: [39] The applicant has accepted that there has been a change of entity of the employer. The entity that employed and subsequently terminated the applicant, Managing Director, TAFE NSW no longer exists. How does this Commission therefore reinstate the applicant to an entity that does no longer exist ? That entity no longer employs TAFE teachers. Through the Amendment Act all members of staff have been transferred to another entity and have vacated the jurisdiction of the Industrial Relations Commission of New South Wales and been transferred to the federal Fair Work Australia industrial system. 21The appellant's application under s 84 seeks reinstatement or financial compensation. It was the appellant's contention that effective relief can be granted because his employer at the time of his dismissal was the State of New South Wales, and in the event reinstatement is impracticable, relief against the State by way of financial compensation is available. According to the respondent, regardless of the jurisdictional question, there is no utility in having the appellant's application granted because it cannot be complied with. This is because the TAFE Commission of New South Wales no longer exists. TAFE teachers are now employed by a constitutional corporation and subject to the supervision of Fair Work Australia. New South Wales no longer employs TAFE teachers and there is, therefore, no place to which the appellant can return. 22The appeal raises a constructional issue as to the proper interpretation and application of cl 16. In order to place the issue in its legislative context, it is helpful to set out, briefly, some consequences of the legislative changes made to the employment of TAFE staff. 23One consequence of the amendments to s 3(1) (definition of "staff member") and s 15 of the TAFE Commission Act was that the TAFE Commission was empowered to employ staff directly, whereas formerly, TAFE staff were public sector employees of the New South Wales Government Service under the PSEM Act. As a result of the amendments, TAFE staff became subject to the Fair Work regime as contained in the FW Act and the Commission ceased to have jurisdiction with respect to an "industrial matter" relating to those staff. This consequence arises from the referral by the State of New South Wales of "industrial matters" to the Commonwealth on 1 January 2010 under s 5 of the Industrial Relations (Commonwealth Powers) Act 2009. The reference at that time excluded "state public sector employees", under s 6 of the latter Act. Prior to 1 December 2011, TAFE staff, being "state public sector employees", were covered by the exclusion in s 6. After that date, they were no longer "state public sector employees" and, accordingly, s 6 no longer applied. On and from 1 December 2011, TAFE Commission staff became "national system employees", as defined in s 13 of the FW Act and subject to s 26 of that Act, which provides, relevantly, that the FW Act is intended to apply to the exclusion of the IR Act. Consequently, the Commission ceased to have jurisdiction over those staff. 24Returning to the constructional issue, we propose to consider whether the legislation, in its plain terms (see Australian Education Union v Department of Education and Children's Services [2012] HCA 3; (2012) 285 ALR 27 at [26] ("AEU"), supports the appellant's construction that cl 16 only applies to those persons whose employment was transferred to the newly constituted TAFE Commission on 1 December 2011. In doing so, we also propose to consider whether there is anything contra-indicative of this construction by reference to the text, context and purpose of the amendments: AEU at [26] and [27]; Board of Bendigo Regional Institute and Further Education v Barclay [2012] HCA 32; (2012) 86 ALJR 1044 at [41]. In this regard, the respondent points to three matters. They are the absence of any transitional provisions with regard to persons in the circumstances of the appellant; the transitional provisions concerning the application of s 146B of the IR Act in cl 16(2) and the non-availability of relief. 25Clause 16(1) is expressed to apply on and from 1 December 2011 to an, "industrial matter ... relating to a member of staff". There was no contest between the parties that an application for relief against unfair dismissal made under Pt 6 of Ch 4 of the IR Act constitutes an "industrial matter" (see s 6(1) and (2)(e) of the IR Act). There was also no contest between the parties that, at the commencement date of the amendments, the appellant was not a "member of staff". This conclusion, in any event, finds strong support in other provisions of the amending Act, to which we will refer. 26Under cl 13(a), an "existing staff member" is defined as a person who, "immediately before the commencement date", was employed by the respondent. As the appellant ceased to be employed by the respondent on 17 October 2011 he did not fall within the definition and, accordingly, cl 13(a) could not apply to him. Consequently, the appellant did not fall within the definition of "transferred staff member" in cl 13 because he was not an "existing staff member" who was transferred to the employment of the newly constituted TAFE Commission by operation of cl 14, that is, "transferred on the commencement date". 27The language of these clauses, including cl 16(1), is explicit and clear. It compels one conclusion which is that the circumstances of the appellant do not fall within the ambit of cl 16(1) which is expressed to apply to "a member of staff". Accordingly, on a plain reading of the text, cl 16(1) does not operate to deprive the Commission of jurisdiction to hear and determine the appellant's application. 28In reaching this conclusion, we also place reliance on the presumptive rule of construction which is against reading a piece of legislation in such a way as to change vested rights, or rights already obtained. There was no real challenge to the appellant's characterisation of the right to have his application heard and determined as one which had accrued prior to 1 December 2011. In this regard, we agree with the appellant, subject to further matters considered below, that it is only by giving the amending Act retrospective operation that it can "catch" the appellant as a prior employee. This is precisely what Ritchie C did when he found that the jurisdiction of the Commission was removed from 1 December 2011 with regard to persons who "were ... employed" by the respondent. In the absence of clear words in the legislative text, however, the presumption against retrospectivity will normally apply. 29There is a wealth of judicial authority dealing with the presumptive rule of construction. The appellant directed our attention to one recent High Court authority, Australian Education Union. The majority judgment of French CJ, Crennan and Kiefel JJ (at [26]), emphasises that statutory interference with existing rights does not make a statute retrospective. In support of this proposition, the majority quoted Fullagar J in Maxwell v Murphy [1957] HCA 7; (1957) 96 CLR 261 at 285 where his Honour said: I think that the word 'retrospective' has acquired an extended meaning in this connexion. It is not synonymous with 'ex post facto', but is used to describe the operation of any statute which affects the legal character, or the legal consequences, of events which happened before it became law. 30The respondent's submissions were to similar effect, that is, the amending Act does not have retrospective operation merely because it interferes with existing rights, which is a relatively commonplace effect of legislative change. One formulation of the general rule of construction by Dixon CJ in Maxwell v Murphy was repeated by the Chief Justice in a passage from Chang Jeeng v Nuffield (Australia) Pty Ltd (1959) 101 CLR 629 and adopted by the majority in Australian Education Union at [26]. In the passage extracted from Chang Jeeng, Dixon CJ said (at 639): The general rule of the common law is that a statute changing the law ought not, unless the intention appears with reasonable certainty, to be understood as applying to facts or events that have already occurred in such a way as to confer or impose or otherwise affect rights or liabilities which the law had defined by reference to the past events. 31A consideration of the common law principles of statutory construction should also involve a consideration of whether statutory rules of interpretation have any application: Australian Education Union at [23]. 32In this jurisdiction, s 30(1) of the Interpretation Act 1987 is applicable. It provides, relevantly: [30] Effect of amendment or repeal of Acts and statutory rules (1) The amendment or repeal of an Act or statutory rule does not: (c) affect any right, privilege, obligation or liability acquired, accrued or incurred under the Act or statutory rule, or ... (e) affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability or penalty, and any such penalty may be imposed and enforced, and any such investigation, legal proceeding or remedy may be instituted, continued or enforced, as if the Act or statutory rule had not been amended or repealed. 33As we adverted to earlier, we do not understand the respondent to challenge the appellant's contention that he had an accrued right on and from 1 December 2011 to have his application heard and determined by the Commission. In support of the contention, the appellant relied on the High Court decision of Esber v The Commonwealth of Australia [1991-1992] 174 CLR 430. 34In Esber, proceedings had been instituted but not determined before the commencement of a new Act which repealed the Act under which the proceedings were instituted. The High Court held that the proceedings were to be continued as if the new Act had not come into force: Mason CJ, Deane, Toohey and Gaudron JJ at 438. 35The respondent sought to distinguish Esber as having no application to the facts the subject of this appeal on the basis that the legislation under consideration in Esber contained savings and transitional provisions which expressly preserved the subject right. 36Esber, we note, was decided on a secondary basis which involved the application of s 8 of the Acts Interpretation Act 1901 (Cth), an Act which deals with the general rule about preservation of rights etc in a way similar to s 30(1) of the Interpretation Act 1987: see discussion by the majority commencing at 438. Two rights were under consideration in Esber, although the focus of the argument was on the second right characterised as the right of the appellant to have the Tribunal determine his application to review a decision of the delegate (the primary decision-maker). In allowing the appeal (at 440-441) the majority said: Once the appellant lodged an application to the Tribunal to review the delegate's decision, he had a right to have the decision of the delegate reconsidered and determined by the Tribunal. It was not merely "a power to take advantage of an enactment" (18). Nor was it a mere matter of procedure (19); it was a substantive right (20). Section 8 of the Acts Interpretation Act protects anything that may truly be described as a right, "although that right might fairly be called inchoate or contingent" (21). This was such a right. It was a right in existence at the time the 1971 Act was repealed. That being so, and in the absence of a contrary intention, the right was protected by s. 8 of the Acts Interpretation Act and was not affected by the repeal of the 1971 Act. 37We have concluded at this stage of our analysis that the text of cl 16(1), on a plain reading, does not evince an intention on the part of the legislature to deprive the Commission of jurisdiction to hear and determine the appellant's application. Ritchie C came to a different conclusion, holding that the amendment had retrospective operation and accordingly the jurisdiction of the Commission to hear and determine the application was removed from 1 December 2011. We have also concluded that the appellant had an accrued right to have his application heard and determined by the Commission. In this matter, the 'right' is one which accrued, or which subsisted in law, once the appellant had been dismissed from his employment, by virtue of s 84 of the IR Act (see, by analogy, the right discussed in Speirs v Industrial Relations Commission of New South Wales [2011] NSWCA 206; (2011) 210 IR 337 at [80] and [85]). 38It remains to consider whether the amending Act evinces a contrary intention to that proposed by the appellant. This brings us to a consideration of the significance of the absence of transitional provisions in the amending Act dealing with persons in circumstances similar to those of the appellant. 39The parties presented two competing arguments directed to the significance of the absence of transitional provisions in the amending Act. According to the appellant, there was no necessity for transitional provisions with respect to former or prior staff because the amending Act only dealt with existing staff who were transferred on the commencement date. According to the respondent, the absence of transitional provisions dealing with prior employees stands in stark contrast to the specific preservation of the jurisdiction of the Commission under cl 16(2) of Sch 4 of the TAFE Commission Act with regard to matters the subject of an application under s 146B. 40It is our view that the mere absence of transitional provisions is an insufficient basis upon which to conclude that the legislature intended to remove from the Commission the jurisdiction to hear and determine applications filed under s 84 of the IR Act before the commencement date. Clear words are necessary in order to be comfortably satisfied that the legislative intention was consistent with the removal of jurisdiction to hear and determine such applications. The text of the amendments, for reasons we have already expressed, evinces a clear intention on the part of the legislature to remove the jurisdiction of the Commission only with regard to persons who were "members of staff" on the commencement date and whose employment was transferred to the newly constituted TAFE Commission. 41Moreover, the reference in cl 16(2) to the preservation of jurisdiction with regard to matters the subject of an application under s 146B does not alter our conclusion. We agree with the appellant on this particular issue that cl 16(2) deals with a prospective matter, that is, it creates rights prospectively to facilitate transferred employees to make applications to the Commission in relation to matters under s 146B of the IR Act. 42Nor do we agree with the respondent that regardless of jurisdictional questions there is no utility in an order being made for relief against unfair dismissal because it cannot be complied with. The appellant's application to the Commission sought two alternative forms of relief: reinstatement or compensation. We see no difficulty with relief being ordered in the form of compensation to the appellant should his application ultimately be successful. The appellant's employer prior to his dismissal was the State of New South Wales, although in a particular division. There can be no impediment to the State paying any amount that may be awarded to the appellant by way of compensation. 43These conclusions are sufficient to dispose of the appeal in favour of the appellant. However, one further matter should be mentioned. Reliance was also sought to be placed by the appellant upon certain savings and transitional provisions in the FW Act in support of the contention that Ritchie C erred in his conclusion that the absence of transitional provisions in the amending Act must mean that the jurisdiction of the Commission was excluded in respect of persons "who were" employed by the respondent before 1 December 2011. Because of the conclusions we have reached, it is unnecessary to resort to the FW Act provisions as an aid to construction. In oral submissions, the appellant informed the Full Bench that it relied on the Commonwealth legislation only in the event his primary contention as to the construction of the amending Act provisions was not accepted. The respondent relied on the FW Act provisions only to show that the power to hear and determine dismissal applications no longer exists within the Commission's jurisdiction, but resides in the Federal jurisdiction. However, as our conclusions have demonstrated, we do not agree with the respondent's contention with regard to the construction of cl 16 of Sch 4 of the TAFE Commission Act.

McGrath v Government of New South Wales - TAFE Commission Division of the Government Service

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