Are the awards formerly binding on the CES and EAA incapable of applying to employees of EN or ENA?
178 It was next submitted on behalf of the appellant Minister that s 149(1) of the WR Act was incapable of creating an entitlement in employees of a successor to a government business to wages and conditions of employment prescribed by awards which could not, as a matter of construction, apply to those employees. The relevant awards in the present case were:
· Australian Public Service, General Employment Conditions Award 1995 ("GECA");
· Australian Public Service, Administrative Services Officers (Salaries and Specific Conditions) Award 1995 ("the ASOs Award");
· Australian Public Service, Professional Officers (Salaries and Specific Conditions) Award 1995; and
· Australian Public Service, Senior Executive Service (Salaries and Specific Conditions Award 1995.
179 It was said that each of those awards was confined in its application to those employees employed pursuant to the provisions of the Public Service Act. In a related way, it was contended that the foundational dispute in settlement of which the awards had been made had been confined in its ambit to one between the CPSU and the Commonwealth as the employer of persons employed pursuant to the Public Service Act.
180 Counsel for the appellant Minister pointed to the fact that the Awards listed in [173] above ("the Awards") had been made in settlement of an industrial dispute between the CPSU and the Commonwealth as the employer of persons pursuant to the Public Service Act. That was said to explain the statement under the sub-heading "Employers" in sub-cl 5.2 of the "Parties Bound" clause of GECA that;
"This award will apply and be binding upon all Ministers of the Crown for the Commonwealth and the presiding officer(s) in respect of employees under the Act."
181 In cl 3.1 of GECA, "Act" is defined to mean "the Public Service Act 1922 as amended from time to time." On behalf of the Minister it was also pointed out that certain provisions in GECA were incapable of applying to persons other than those employed under the Public Service Act. Accordingly, so the submission went, the proviso to s 149 that the binding affect of any award is "subject to any order of the Commission" has been satisfied in respect of GECA, amongst other awards, because its application has been limited by order of the Commission to persons employed under the Public Service Act.
182 In aid of this argument, Mr Robertson SC, who appeared with Mr Bennett for the Minister, sought to distinguish North Western on the ground that the awards in that case were expressed to be binding "in respect of all employees of the Department of Health and Community Services (Victoria) eligible to be members of .....[relevant unions]." The Awards, by contrast, were expressed to be binding on "all Ministers of the Crown for the Commonwealth and the presiding officer(s) in respect of employees under the Act." (ie. the Public Service Act).
183 The CPSU's response to these arguments is that they do not preclude awards like those in question from applying by force of s 149(1) to employees of a transmittee insofar as those awards are capable of applying to those employees. If they are incapable of so applying, the Awards are to that extent unenforceable but that does not mean that they are deprived of the pro tanto application preserved by s 149(1)(d) of the WR Act. Support for that view is said to be derived from the fact that, in the form in which it appeared in the Industrial Relations Act 1988 (Act No 86 of 1988), s 149 differed from the corresponding provision, s 61, of the Conciliation and Arbitration Act 1904 by the presence, at the beginning of the prefatory words of the section, of the expression "Subject to any order of the Commission ....". At the same time there were inserted in par (d) of what became s 149(1) the words "or part of the business .....". By expressly stipulating that the binding effect of an award was "subject to any order of the Commission", the new section, it was submitted on behalf of the CPSU, effectively removed the possibility that limitations on the binding effect of a particular award, including its effect on a presumptive assignee or transmittee of the business or part of the business of a party to the dispute, might arise by implication from the terms of the award or the circumstances in which it was made. In the event, it is unnecessary to do more than note this submission because Counsel for each of the Minister and EN have disavowed any contention that any of the Awards contains a provision amounting to a contrary order of the kind contemplated by the prefatory words in s 149(1).
184 The CPSU sought to meet the appellants' contention that the foundational dispute had been confined to employees covered by the Public Service Act by pointing out that the finding of dispute made on 24 November 1992 recorded:
"1. That an industrial dispute exists between the Public Sector, Professional, Technical, Communications, Aviation and Broadcasting Union and the employers named in Annexure "A" to this finding of dispute.
2. The matters in dispute are set out in a letter of demand dated 18 September 1992 and a log of claims attached thereto.
3. The dispute extends beyond the limits of any one state of Australia."
185 The employers named in Annexure "A" to the finding of dispute included eighteen Ministers of the Crown in right of the Commonwealth, parliamentary officers and chairpersons, managing directors and directors of certain statutory bodies as well as the Chief Justice of the High Court and the Chief Minister of the "ACT Government". In the log of claims itself, the word "employee" was defined to mean "a person who:
(i) is a member of the union,
(ii) is eligible to be a member of the union, or
(iii) becomes eligible to be a member of the union by an order of the Australian Industrial Relations Commission."
186 The first sentence of the standard form letter addressed to each employer served with the log recited:
"The Australian Public Sector, Professional and Broadcasting Union, Australian Government Employment (PSU), on behalf of its members and persons eligible to be members now engaged in employment or hereafter to be engaged in employment in your department/agency, claims that the employment of such persons and each of them shall be under and subject to the provisions and upon the terms and conditions set out in the attached Schedule A and that all payments, allowances and benefits shall in the circumstances and under the terms and conditions set forth in the said Schedule A be made and accorded to each and all such persons."
187 In the light of the conclusions reached on the issues discussed above, this question ultimately turns on whether the Awards evince an intention so to limit the obligations of the Commonwealth, as represented by the Ministers, as to indicate that the Awards can or should, exceptionally in the light of ss 149 and 170MB, have no operation following a transmission or assignment of part of the business of the Commonwealth to a corporation or corporations beneficially owned and controlled by the Commonwealth.
188 In favour of an affirmative answer, the following may be said:
· The Awards in terms bind the Minister only "in respect of employees [including, by virtue of interpretation clauses in the Awards, officers] under the [Public Service] Act";
· That Act and other legislation (e.g. the Long Service Leave (Commonwealth Employees) Act 1976 ("the LSL Act") and the Superannuation Act 1976 ("the Superannuation Act")) provided, especially for officers, but also to an extent for employees, a specific regime of employment rights and responsibilities dissimilar in some important respects from those commonly found in employment contracts to which the Commonwealth is not directly a party;
· Each of the Awards is expressed to form "part of a set of integrated paid rates awards". That is, the employees would ordinarily not expect to receive benefits from the Commonwealth in excess of those provided by the Awards (and relevant legislation). The position may not be the same in the new "corporatised" environment; and
· Section 149(1)(d) does not provide that employees shall continue, after a transmission, to enjoy the same remuneration and conditions prescribed by an award as binding on a former employer. What the section says is that the "award … is binding on a [transmittee etc] of the business or part of the business". But the Awards never did regulate the salaries and conditions of persons not appointed or employed under the Public Service Act. Neither do they, after the transmission.
189 However, there are countervailing considerations which, in our view, outweigh these matters.
190 As indicated above, the Prime Ministerial certificate contemplated by s 81C(1) was duly given (see [174] above). The declaration of the [successor of the Public Service] Board also contemplated by subs (1) was likewise given: on 1 May 1998 the Board's successor declared that the relevant officers "are in the employment of [ENA]" with effect from that day.
191 While s 81C may be said to have various purposes, subs (3) seems to contemplate that the receiving authority would, or at least may, make its determination before the instantaneous transfer effected by subs (2). This appears to indicate an assumption and intention that the transferred officers should continue to have the protection of any pre-transfer public service award as well as, in the light of s 149(1)(d), that of any private sector award to which the receiving authority might be subject (although s 81C would normally apply to a new authority, as yet without any (or many) employees and unlikely to be covered by an existing award). Such an intention is conformable with Division 3 ("Rights of certain former officers") of Part IV of the Public Service Act. That Division has the evident purpose, in respect of s 81C officers (see s 87K(2A)), of preserving certain of their rights accrued whilst in the Service, for example long service leave (s 87L), and a right to be transferred or promoted to a Public Service position. Moreover, it was thought necessary in s 81C(3) specifically to empower the authority to determine only "special" terms or conditions for the single limited purpose of facilitating the transfer. Plainly, the assumption and intendment were that the ordinary operation of an award would not be affected. Such operation is prescribed by s 149, not only in relation to succession assignment or transmission situations, but generally. In general, fair dealing with, and a considerable measure of protection of the existing entitlements of, officers transferred out of the Public Service under s 81C but still, so to speak, working within the Commonwealth's direct sphere of influence, were among the legislative purposes.
192 This analysis is also consistent with the general history of the determination of the employment entitlements and obligations of officers and employees of the Commonwealth Public Service. Some of these have been prescribed by statutory provisions, some by delegated legislation and some by industrial awards. However, over time, both the scope of award (as distinct from non-award) regulation and the ease with which award prescriptions might override provisions of the Public Service Act have exhibited a marked tendency to increase.
193 So far as is presently relevant s 81C(3) was intended to provide a means of fair, just and effective preservation, or appropriate adaptation, of the non-award rights and liabilities of officers and employees upon their transfer from the public service proper to a Commonwealth authority. S 81C(3) was not intended to be a means of displacing the pre-transfer award entitlements of officers and employees, notwithstanding that the availability of those rights against the authority might depend upon a succession mechanism (like that embodied in s 149) in the law setting up the award system, since awards are creatures of statute.
194 There was no need for the Parliament to provide as it did by s 81C in order to enable orderly preservation and adaptation of award entitlements. The terms of the Workplace Relations Act and its predecessors, among other things, have given broad powers to the Australian Industrial Relations Commission, including the ability to vary awards. Moreover, s 149 was itself sufficient to preserve existing award entitlement against the transferee authority .
195 Further, it is very unlikely that Parliament would have intended by s 81C to deprive officers and employees (and their registered organisations) of such award rights as would or might otherwise be preserved for them by s 149 without expressly and clearly saying so. Such a deprivation would have reflected an important legislative policy and one philosophically apparently at odds with the preservative approach to officers' and employees' rights adopted by the Public Service Act generally: see, for example, the references in [191] above.
196 The Awards are expressed to be "read in conjunction with the [Public Service] Act and regulations …, determinations and terms and conditions made thereunder from time to time" and "[w]here the Act, its regulations, determinations and terms and conditions made thereunder are inconsistent with the provisions of [the awards], the latter will prevail". (See e.g. cl 6.2 of the GECA) Thus if the awards were inconsistent with any non-award action taken pursuant to s 81C(3) the Awards would prevail. That accords with the specific contemplation of s 121 of the Workplace Relations Act.
197 This is a case where no relevant pre-transmission employee was anything other than an officer or employee under the Public Service Act. The use of the phrase "in respect of employees under the Act" in the Awards was therefore not to mark out some classes of "employees" directly engaged by the Commonwealth from others. The point was to ensure that these awards did not reach to the particular,named "Commonwealth agencies" which were also parties to the underlying dispute, in part settlement of which the subject awards were made. Hence, it is fair to say that, in the present context, that phrase had no work at all to do. It was, in context, no more than a way of saying that, in respect of direct engagement by the Commonwealth, the Awards should extend to all officers and employees. Moreover, it seems highly unlikely that anyone connected with the making of the awards - the Commission, any of the Ministers, or (quite certainly) the appellant CPSU - would have had any interest in so delimiting the binding force of each award as to deny officers and employees the benefit of s 149(1)(d).
198 The Commonwealth's activities were and are very diverse. As history shows, the policies and views of Parliament and governments are likely, from time to time, to fluctuate as to whether particular activities are best carried out by a corps of directly employed public servants, by a Commonwealth statutory authority, by a Commonwealth owned or controlled corporation or entirely by the private sector. Sections 149(1)(d) and 170MB are, in principle, available to protect the continuity of an industrial settlement and employees' rights in every other transmission of business to which a federal award or agreement applies. It would be odd if the vagaries of the wording of an "incidence" or "parties bound" clause of an award, clearly enough aimed at excluding other particular employers from its scope, were to be able, inadvertently to create industrial confusion or uncertainty in respect of such a large body of employees, virtually any of whom might find the Commonwealth's relevant activities and their work "outsourced" in some way. Section 149 has been enacted, we consider, to avoid difficulties of that kind, among others.
199 As to the Awards being "paid rates" awards, although a new industrial environment, like that created by the introduction of EN, should and would not necessarily prevent some individual employees receiving more remuneration than that provided by a general prescription, one of the purposes of s 149 is to prevent the occurrence of a hiatus in general prescription of minimum entitlements for employees, so that industrial peace might be preserved: George Hudson Ltd v Australian Timber Workers Union (1923) 32 CLR 413. Section 149 does not contemplate that the new employing entity is not, after transmission, or even in anticipation of it, free to negotiate, or obtain by arbitration, any variation to the relevant award which might be thought necessary for the new circumstances.
200 Further, if those new circumstances do truly make some of the award provisions quite unworkable, then so be it. But that is not determinative of the present question. The ordinary principle is that courts should strive to give effect to a legal instrument if effect can be given to it. In Darling Point Securities Pty Ltd v Industrial Equity Pty Ltd (1991) NSWConvR 55-589, Clarke JA said (Priestley and Handley JJA agreeing):
"There is, in my opinion, a general principle of construction which applies to the present agreement. This principle has been described in a number of ways but is to the effect that courts should be astute, if possible, to adopt a construction which upholds the validity of the contract."
201 In the context of interpreting a statutory instrument, Cross J said in Clyne v Federal Commissioner of Taxation (1980) 49 FLR 25:
"… it appears to me not unreasonable for a court in construing an instrument affecting the requirements of citizens to furnish returns of income…to seek to give that instrument validity."
202 This would indicate that the Awards should apply so far as they are capable of doing so, and that a commonsense, adaptive construction of the Awards should be adopted to enable this to occur. The Awards can, simply, apply mutatis mutandis to employees of EN. For example, the ASOs Award prescribed pay rates by broad public service classifications, notably by "classes" of Administrative Service Officer. But the CES and EAA had "local" designations for particular "jobs", and it would not generally be a matter of difficulty to assign by analogy a post-transmission job to the appropriate class , even if the particular job had changed to some extent in the new environment. A similar process can, if necessary, be undertaken in respect of the "conditions" prescribed, e.g. by GECA.