Orica Australia Pty Ltd v Coal Mining Industry
[2023] FCA 1515
At a glance
Source factsCourt
Federal Court of Australia
Decision date
2023-12-05
Before
Mr J, Perram J
Source
Original judgment source is linked above.
Judgment (13 paragraphs)
- The costs of the proceeding to date be reserved. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Introduction 1 The question in this case is whether shotfirers who work for the Applicant ('Orica') at open cut black coal mines in New South Wales are 'eligible employees' within the meaning of s 4(1) of the Coal Mining Industry (Long Service Leave) Administration Act 1992 (Cth) ('the Administration Act'). In open cut black coal mining , shotfiring is a collection of activities by which a black coal seam is exposed by the detonation in holes in the ground of high-powered explosives (usually, but not always, ammonium nitrate). Although it is convenient to refer to the personnel involved in this activity as shotfirers there are, in fact, several roles involved in the process which leads to the firing of the 'shot'. I will refer to all the employees engaged in these activities as 'shotfirers' although strictly only the individual who presses the button is the shotfirer. 2 As a matter of mining engineering the efficient extraction of coal requires the process of exposing the coal to be highly integrated with the process of extracting it. There is no point in exposing coal which is not going to be promptly extracted and only waste, which commerce abhors, results from having expensive mining equipment sitting around waiting for the coal to be exposed. Likewise, issues of occupational health and safety, always prominent in the mining sector, are especially significant where large quantities of high explosives are being shuttled around a mine and then detonated. This is so not only for those who are engaged in the exciting vocation of shotfiring but also for anyone else in the vicinity. Thus, whilst shotfiring is a distinct activity plainly different to, for example, digging up and putting coal in a truck, it is nevertheless directly involved in the process of extracting coal and, as I have said, necessarily integrated into that process to a significant degree. 3 The black coal mining industry has, over a long period, been the subject of industrial disputation and complex regulation. The fronts over which this has ranged have included matters of safety and the benefits due to those whose work results in the extraction of the coal. Industrial instruments of various descriptions have frequently been jurisdictionally delimited by the concept of the 'coal mining industry' or more recently the 'black coal mining industry'. 4 In 1949 there was a period of intense industrial disharmony which culminated in the great coal miners' strike of that year. After the declaration of a national emergency and the passage of the National Emergency (Coal Strike) Act 1949 (Cth), the strike was eventually broken when the Chifley government sent in the army to operate the coal mines. Following the cessation of hostilities those working in the black coal mining industry won from those operating the coal mines a portable long service leave benefit which operated by reference to the length of service in the black coal mining industry rather than the length of service with an employer. It was and is a generous scheme. 5 This scheme has been through several iterations. Between 1949 and 1992 it was regulated under various industrial instruments and funded by an excise imposed by the Commonwealth on the production of coal. In 1992 this source of funding was replaced by a payroll tax imposed on, loosely speaking, employers in the black coal mining industry. At the same time the opportunity was taken to regulate the benefit using the taxation power under s 51(ii) of the Constitution, thereby avoiding the coverage pitfalls inherent in the use of the s 51(xxxv) power to legislate with respect to the conciliation and arbitration of industrial disputes extending beyond the limits of any one State. Following this development, the reach of the benefit was much greater than the reach of the Commonwealth's power to regulate the industrial affairs of the industry in which the benefit was conferred. 6 In 2006 the Commonwealth's ability to regulate the black coal mining industry under the corporations power in s 51(xx) of the Constitution caught up with its ability to impose a payroll tax on that industry (and thereby provide the long service leave benefit). In 2010 this resulted, for the first time, in a single instrument which regulated the industrial affairs of the black coal mining industry. This occurred when the Australian Industrial Relations Commission made the Black Coal Mining Industry Award 2010 ('the Award'). I will call the Commission and its successor 'the Commission'. At this point the legislation providing for the payroll tax was dovetailed with the Award so that both operated by reference to the black coal mining industry. For the first time the Commission introduced a definition of 'black coal mining industry'. 7 There has been intermittent litigation about the long service leave benefit which appears to have increased after the Commission's decision to define the industry in the face of earlier decisions which had described the industry as not being susceptible to precise definition. Because the benefit is funded by means of a tax on employers it has engendered in those from whom it is collected an ambition so far as is possible to reduce their liability to its exaction. This has brought the tax lawyer's eye to bear on the formerly amorphous concept of the black coal mining industry and this has resulted, in turn, in several bouts of litigation between the regulator of the scheme (i.e. the Respondent) and employers anxious not to pay the payroll tax if possible. 8 Largely these debates have concerned the position of third-party contractors in relation to coal mining operators. For example, in Coal Mining Industry (Long Service Leave Funding) Corporation v Hitachi Construction Machinery (Australia) Pty Ltd [2023] FCA 68; 322 IR 129 ('Hitachi') the question was whether employees of a supplier and repairer of earth moving equipment were caught by the scheme. A feature of this genre of litigation is that it is becoming more complex. The Commission's decision to define the black coal mining industry has exacerbated this problem, as this case shows. 9 The scheme operates by reference to the concept of an 'eligible employee'. On 21 May 2019, the Respondent issued a notice to Orica requiring it to produce information and documents relating, in effect, to the question of whether its shotfirers were eligible employees for the period from 2010. Orica contends that the notice is invalid because its shotfirers were not 'eligible employees' over whom the Respondent's remit extended during that period. 10 The parties agree that it would be advantageous to have the Court's conclusions on the shotfirers' eligibility before further debating the validity of the notice. Accordingly, the eligibility question has been severed from the remainder of the proceeding and is to be determined first. The parties were ably represented by experienced counsel. Mr Murdoch KC and Mr Fuller appeared for Orica and Mr Clarke SC and Mr Meehan (as Mr Meehan SC then was) appeared for the Respondent. 11 An 'eligible employee' is defined in s 4(1) of the Administration Act in these terms: eligible employee means: (a) an employee who is employed in the black coal mining industry by an employer engaged in the black coal mining industry, whose duties are directly connected with the day to day operation of a black coal mine; or (b) an employee who is employed in the black coal mining industry, whose duties are carried out at or about a place where black coal is mined and are directly connected with the day to day operation of a black coal mine; or (c) an employee permanently employed with a mine rescue service for the purposes of the black coal mining industry; or (d) a prescribed person who is employed in the black coal mining industry; but does not include a person declared by the regulations not to be an eligible employee for the purposes of this Act. 12 It will thus be seen that the Administration Act is concerned only with the black coal mining industry. For those who are interested, the mining of brown coal seems to be largely integrated into the electricity sector and is subject to separate industrial regulation. Returning to the case at hand, sub-ss (c) and (d) of the above definition can be put to one side. There is no dispute that the shotfirers performed their duties at black coal mines or that the performance of their duties was directly connected with the day to day operation of a black coal mine. The question is whether the shotfirers were 'employed in the black coal mining industry' for the purposes of sub-s (b) ('the location limb'). Sub-section (a) ('the employer limb') does not arise for consideration in this case. If the shotfirers were employed in the black coal mining industry then the location limb will be satisfied and the employer limb will not matter. If they were not employed in the black coal mining industry neither limb will be satisfied. 13 Nevertheless, the relationship between these two limbs contemplated by the definition in s 4(1) has important ramifications. The employer limb differs from the location limb inasmuch as it requires an employer to have a particular quality ('engaged in the black coal mining industry') whereas the location limb does not mention the employer at all but requires instead that the employee work at or near a particular location (unsurprisingly, a black coal mine). Accordingly, an employee who works for an employer engaged in the black coal mining industry does not need to work at or near a black coal mine and, if an employee is employed in the black coal mining industry at or near a black coal mine, it does not matter at all who their employer is or in which industry that employer happens to be engaged. 14 If the analysis were to end there, it would be clear that the shotfirers were employed in the black coal mining industry all other things being equal. However, the antipodean fascination with definitional exactitude has given rise to an implausible, yet entirely respectable, argument that they were not. This case, and the definition which the Award provides of the black coal mining industry, perhaps illustrate why, where drafting is concerned, a zeal for conceptual precision is unwise. This is particularly so where, as here, the concept sought to be delineated is inherently fuzzy. Drafting is complex. The more components there are in it the more susceptible it is to Murphy's Law which holds that if something can go wrong it will eventually do so. The more elements there are in a scheme of regulation the more ways it can go off the rails and the greater the likelihood that it will do so. In this case, as will be seen, the rails are only indistinctly visible in the rear vision mirror. 15 To have been within the location limb the shotfirers must have been 'employed in the black coal mining industry'. The black coal mining industry is defined in s 4(1) this way: black coal mining industry has the same meaning as in the Black Coal Mining Industry Award 2010 as in force on 1 January 2010. 16 The black coal mining industry is defined in the Award in cll 4.2 and 4.3: 4.2 For the purposes of this award, black coal mining industry has the meaning applied by the courts and industrial tribunals, including the Coal Industry Tribunal. Subject to the foregoing, the black coal mining industry includes: (a) the extraction or mining of black coal on a coal mining lease by means of underground or surface mining methods; (b) the processing of black coal at a coal handling or coal processing plant on or adjacent to a coal mining lease; (c) the transportation of black coal on a coal mining lease; and (d) other work on a coal mining lease directly connected with the extraction, mining and processing of black coal. 4.3 The black coal mining industry does not include: (a) the mining of brown coal in conjunction with the operation of a power station; (b) the work of employees employed in head offices or corporation administration offices (but excluding work in town offices associated with the day-to-day operation of a local mine or mines) of employers engaged in the black coal mining industry; (c) the operation of a coal export terminal; (d) construction work on or adjacent to a coal mine site; (e) catering and other domestic services; (f) haulage of coal off a coal mining lease (unless such haulage is to wash a plant or char plan in the vicinity of the mine); or (g) the supply of shotfiring or other explosive services by an employer not otherwise engaged in the black coal mining industry. 17 It is agreed that during the relevant period Orica conducted a business which included the supply of shotfiring and explosive services and that it did so at a number of black coal mines in New South Wales and Queensland. It is also agreed that the work being done by the operators of these mines included the mining and extraction of black coal on a black coal mining lease (cl 4.2(a)), the transportation and processing of black coal on such a lease (cll 4.2(b) and (c)) and other work on a coal mining lease directly connected with the extraction, mining and processing of black coal (cl 4.2(d)). Thus it is inevitable that the operators of these open cut black coal mines were 'engaged in the black coal mining industry'. 18 It is also agreed that Orica's provision of shotfiring and explosive services at these black coal mines was an integral part of the operation of those mines. The evidence of Professor Bruce Hebblewhite made this inevitable. Professor Hebblewhite is an Emeritus Professor at the University of New South Wales specialising in mining engineering. He described in detail the manner in which shotfiring is used to remove overburden from above a coal seam. In particular, he explained that blast design and scheduling are critical parts of the mining operation. This is because a smooth blasting process ensures that the overburden is removed at a sufficient rate to permit the coal to be extracted in accordance with the mine's production schedule: Court Book 707. 19 Whilst the provision by Orica of its shotfiring services at these mines did not involve the actual extraction of black coal by the shotfirers there can be no shadow of a doubt that it was 'work on a coal mining lease directly connected with the extraction, mining and processing of black coal' within the meaning of cl 4.2(d). Thus, the provision by Orica of these services falls within the definition of the black coal mining industry in cl 4.2(d). For the same reasons, the work done by Orica's shotfirers necessarily meant that they were employed in the black coal mining industry at least so far as cl 4.2(d) is concerned. 20 The question which divides the parties is the impact, if any, on this conclusion of the excision from the black coal mining industry referred to in cl 4.3(g). 21 In my view, cl 4.3(g) has no application in this case. The definitions in s 4(1), including that of the black coal mining industry, do not apply if the contrary intention appears from the face of the statute ('In this Act, unless the contrary intention appears:'). The structure of the definition of 'eligible employee' in s 4(1), specifically the inclusion of disjunctive employer and location limbs, gives rise to a clear implication that the character of an employer was not intended to be relevant to the location limb. 22 Clause 4.3(g) excises from the black coal mining industry the provision of shotfiring services by an employer unless the employer is 'otherwise engaged in the black coal mining industry'. Thus, the excision in cl 4.3(g) has the consequence that consideration of whether shotfirers are 'employed in the black coal mining industry' for the purposes of the location limb necessarily, and in my view impermissibly, involves two inquiries concerning the employer: i) whether the employer provides shotfiring services; and ii) whether it is otherwise engaged in the black coal mining industry. By these means the effect of cl 4.3(g) is to make these qualities of the employer inopportunely appear as requirements in the location limb in the definition of 'eligible employee' in s 4(1). However, as I have explained, the relationship between the employer limb in sub-s (a) and the location limb in sub-s (b) of that definition demonstrates that Parliament intended that the qualities of the employer were to be irrelevant to the location limb. 23 It follows that to the extent that the definition in s 4(1) of the 'black coal mining industry' includes cl 4.3(g) it cannot be reconciled with the location limb in the definition of 'eligible employee' in s 4(1). Consequently, a contrary intention is demonstrated on the face of the location limb and the 'black coal mining industry' referred to in that limb cannot be the black coal mining industry defined in the Award. On the other hand, s 4(1) of the Administration Act also clearly shows that the Parliament intended the legislative scheme to operate by reference to the same black coal mining industry as the Award does. Whilst one must give effect to the structural imperatives of the location limb, one should do so in a way which does as little violence to that concept as possible. These conflicting aims may be reconciled by reading the reference to the 'black coal mining industry' in the location limb as having the same meaning as it bears in the Award but without cl 4.3(g). 24 Read that way, the excision in cl 4.3(g) is not relevant to the location limb. Since the shotfirers are plainly employed in the black coal mining industry defined in the Award when cl 4.3(g) is disregarded, and are so employed at black coal mines in direct connection with the day to day operation of those mines, they are necessarily eligible employees under the location limb. 25 That conclusion resolves the case. If I were wrong in that view, it would be necessary to resolve a number of other issues between the parties.