Pace v Technical and Further Education Commission t/as TAFE Commission

Industrial Relations Commission (NSW)|2014-04-15|Before: Boland AJ, Commission J

Judgment 1In an amended application the applicant, Alf Pace, seeks declaratory orders pursuant to s 154 of the Industrial Relations Act 1996 ("the IR Act"). The essential purpose of the application is to have declared a right to the benefit of orders made by the Industrial Relations Commission of New South Wales in 2011 reinstating Mr Pace in his employment with the Technical and Further Education Commission (hereinafter referred to as "the TAFE Commission"). The orders sought by Mr Pace were as follows: 1. A Declaration that the Respondent is bound by the orders of the IRC. 2. A Declaration that the Respondent bound (sic) by undertakings given to this Honourable Court. 3. Respondent pay the Applicant compensation. 4. The Respondent pay the Applicants (sic) costs.

Declaratory orders 9The Industrial Court has jurisdiction to make declaratory orders: see s 153(1)(b) of the IR Act. Section 154 provides: 154 Declaratory jurisdiction (1) The Commission in Court Session may make binding declarations of right in relation to a matter in which the Commission (however constituted) has jurisdiction. The Commission in Court Session may do so, whether or not any consequential relief is or could be claimed. (2) Proceedings before the Commission in Court Session are not open to objection on the ground that a declaration of right only is sought. 10Hungerford J considered the scope of s 154 in Ford v SAS Trustee Corporation [2000] NSWIRComm 92; (2000) 98 IR 444. In that case the applicant had sought declarations in relation to the length of his service as a police officer in the Police Service of New South Wales for the purpose of enabling the proper calculation of his statutory superannuation benefits following his medical discharge from the Police Service. At [76] his Honour stated: The fundamental nature of the declaratory power in s.154 of the Industrial Relations Act is, in the opinion I hold, based on the existence of a matter which the Commission (either as the Commission or sitting as the Court) has jurisdiction and even though no consequential relief is or could be claimed. In other words, a declaration of right may be made once there be identified a matter otherwise within the Commission's or the Court's jurisdiction, regardless whether any proceedings exist as to that matter, provided the declaration as sought relates to it. 11At [79]-[80] Hungerford J further stated: [79].... What matters, it seems to me, was the right or entitlement of the applicant to certain leave and whether the declaration sought was in relation thereto, provided the subject matter of the leave was otherwise within power. I think it may be undoubted that the Commission has jurisdiction as an industrial matter in respect of leave for police officers: see Industrial Relations Act in ss 6(1), 6(2)(c) (g) and (h), 10, 136, 404 and 405(1)(b); see also Police Service Act in ss 84, 85(1) and 218(1). [80] It follows, I would conclude, that there is power under s 154 of the Industrial Relations Act to make a declaration as to the true nature of the period of the applicant's leave without pay from 5 August 1989 to 21 September 1995. I would only add, in response to Mr Willis' submission that industrial matters concern the relations of employers and employees, that at the relevant time the applicant was employed by the second respondent, albeit on leave, and as to which a dispute arose as to the nature of the leave. 12The Full Bench in Tempo Services Ltd v Strezouski [2005] NSWIRComm 329, stated (at [43]-[44]): [43] The power to grant declaratory relief under s.154 is provided only to the Commission in Court Session although the power is expressed in extremely wide terms and may be exercised and respect to any matter "in which the Commission (however constituted) has jurisdiction". That phrase means that the Court Session may grant declaratory relief in respect of any matter in which the Court Session of the Industrial Relations Commission has jurisdiction. 13The general principles governing the granting of declaratory relief were set out in the judgments of the High Court in Ainsworth v Criminal Justice Commission [1992] HCA 10; (1992) 175 CLR 564 at 581-582, 595-597. Mason CJ, Dawson, Toohey and Gaudron JJ expressed the principles as follows: It is now accepted that superior courts have inherent power to grant declaratory relief. It is a discretionary power which "(i)t is neither possible nor desirable to fetter ... by laying down rules as to the manner of its exercise."(26) Forster v. Jododex Aust. Pty. Ltd. [1972] HCA 61; (1972) 127 CLR 421, per Gibbs J. at p 437. However, it is confined by the considerations which mark out the boundaries of judicial power. Hence, declaratory relief must be directed to the determination of legal controversies and not to answering abstract or hypothetical questions (27). See In re Judiciary and Navigation Acts [1921] HCA 20; [1921] HCA 20; (1921) 29 CLR 257. The person seeking relief must have "a real interest"(28) Forster (1972) 127 CLR, per Gibbs J. at p 437; Russian Commercial and Industrial Bank v. British Bank for Foreign Trade, Ltd. (1921) 2 AC 438, per Lord Dunedin at p 448. and relief will not be granted if the question "is purely hypothetical", if relief is "claimed in relation to circumstances that (have) not occurred and might never happen"(29) University of New South Wales v. Moorhouse [1975] HCA 26; (1975) 133 CLR 1, per Gibbs J. at p 10 or if "the Court's declaration will produce no foreseeable consequences for the parties"(30). Gardner v. Dairy Industry Authority (N.S.W.) (1977) 52 ALJR 180, per Mason J. at p 188; see also per Aickin J. at p 189; 18 ALR 55 at pp 69, 71 respectively. 14Whilst it was stated in Ainsworth that relief will not be granted if 'the Court's declaration will produce no foreseeable consequences for the parties', the consequences may be legal or practical: Ainsworth at 582. Thus, the court may refuse to grant declaratory relief if the result of the proceedings would be of little practical value: Integrated Lighting and Ceilings Pty Ltd v Philips Electrical Pty Ltd (1969) 90 WN (Pt 1) (NSW) 693 at 702, per Hope J; P W Young, Declaratory Orders, 2nd ed, 1984 at 61 ff. 15The term "right" is to be given a broad construction to include privileges, powers and immunities: Sankey v Whitlam [1978] HCA 43; (1978) 142 CLR 1 at 23 per Gibbs ACJ. 16Finally, I should mention that whilst the Court has a discretionary power to refuse declaratory relief (eg where a declaration will produce no foreseeable legal or practical consequences for the parties) P W Young in his text expressed a note of caution as to a refusal to exercise discretion (at [720]) as follows: [720] Although the courts say that in a proper case relief will be refused in its discretion, it is sometimes very hard indeed to make the submission that in a particular case, although the court has come to the conclusion that the plaintiff is in the right, it should not declare that right. There usually has to be some public interest which cancels the plaintiff's prima facie right to have the court declare for him. ... Other public interests that will mean the plaintiff should not get a declaration occur in cases almost exactly similar to those which have been summarised earlier in this chapter as matters of jurisdiction. The court may hold that there is jurisdiction to deal with the subject-matter, but because of the inutility of it all, no declaration should be made.

Full Bench decision in McGrath 17At this point I should refer to the decision of the Full Bench in McGrath v Government of New South Wales - TAFE Commission Division of the Government Service [2012] NSWIRComm 129. In that case the appellant had been dismissed from his employment by the Government of New South Wales - TAFE Commission Division of the Government Service, that is, the same entity as the employer of Mr Pace. On 4 November 2011, the appellant applied to the Commission for relief against unfair dismissal under the provisions of Pt 6 of Ch 2 of the IR Act. The application was conciliated on 29 November 2011 and was stood over, part heard, until 7 December 2011. On 1 December 2011, of course, the amending Act commenced. 18By notice of motion the respondent asserted that the Commission was without jurisdiction to hear the appellant's application as a result of cl 16 of Sch 4 of the TAFE Commission Act. The motion was heard by Ritchie C, who made findings, as summarised by the Full Bench, to the following effect: (i) at 1 December 2011, existing staff as referred to in Pt 4 of Sch 5 of the TAFE Commission Act were transferred to the TAFE Commission; (ii) the appellant's employment was terminated on 17 October 2011 and, therefore, he was not an existing staff member (as at 1 December 2011) and could not be transferred; (iii) the amending Act effected a change in the entity of the employer; (iv) at 1 December 2011, the Commission ceased to have jurisdiction to determine an "industrial matter ... relating to a member of staff" under cl 16(1)(a) because of s 26 of the Fair Work Act 2009 (Cth) ("the FW Act") (which applied to the exclusion of the IR Act so far as it would otherwise apply in relation to national system employees in respect of, "providing for rights and remedies connected with termination of employment" (see s 26(2)(b)(v) of the FW Act)); (v) the Commission had jurisdiction to hear and determine the appellant's application from the date it was filed until 1 December 2011; (vi) the amendments to the TAFE Commission Act did not "catch" the appellant because he was not an existing staff member as at 1 December 2011. 19At [34] of the Commissioner's decision (McGrath v Managing Director TAFE. [2012] NSWIRComm 1006) the Commissioner stated: I accept the submission of the respondent in that the lack of transitional arrangements makes it quite clear what the intention of the legislature was, that is, to remove the jurisdiction of this Commission from 1 December 2011 in regard to persons who were or are employed by the respondent. 20As the Full Bench observed, Ritchie C then examined, in the event his findings as to jurisdiction were wrong, whether there existed some residual power to determine the matter and, if so, what enforceable order, if any, could be made. It was noted that the application for relief sought both reinstatement and compensation. The Commissioner considered two authorities which dealt with the notion of reinstatement: Commissioner of Police for New South Wales v Lawrance & Anor [2011] NSWCA 377 and Retail Traders Assn v SDAEA (1989-1991) 36 IR 38. In the first-mentioned authority, Ritchie C extracted the following passage: [50] Section 89(1) of the IR Act empowers the IRC to order the employer (in this case the Commissioner) to "reinstate the applicant to his or her former position on terms not less favourable" than those that would have applied had the applicant been dismissed. To "reinstate" means to restore the applicant to the employment situation as it existed immediately before the applicant was removed from his or her position: Blackadder v Ramsey Butchering Services Pty Ltd [2005] HCA 22; 221 CLR 539, at 544 [14], per McHugh J; at 549-550 [33]-[34], per Kirby J; at 552-553 [43]-[46], per Hayne J; at 565 [75], per Callinan and Heydon JJ. Section 89(1) does not confer power on the IRC to do anything other than reinstate the applicant to his or her former position and to do so on "terms not less favourable" than those the applicant previously enjoyed. 21Again, as the Full Bench observed, based on the foregoing observations and observations made to similar effect in Retail Traders Assn v SDAEA (at [46]), Ritchie C made the following additional findings (at [39] and [40]): [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. [40] It is my finding that this Commission does not have the jurisdiction to reinstate the applicant back to his position as a TAFE teacher, as the entity that once employed the applicant no longer exists and therefore the relationship can no longer be re-established. 22On appeal, the Full Bench made the following relevant findings: (1)Clause 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" (at [25]). (2)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 (at [27]). (3)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... 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 (at [28]). (4)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. 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]) (at [37]). (5)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 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 (at [40]). (6)The appellant's application sought two alternative forms of relief: reinstatement or compensation. There is 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 (at [42]). 23The Full Bench allowed the appeal and remitted the matter to a Member of the Commission to be determined in accordance with the law.

Commission's jurisdiction not affected 24It follows from the decision in McGrath that as the execution of the order of MacDonald C reinstating Mr Pace had been stayed on 15 November 2011, Mr Pace was not an "existing staff member" and, therefore, not a "transferred staff member" as at 1 December 2011. Accordingly, cl 15 of Pt 5 of Sch 4 of the TAFE Commission Act did not apply to Mr Pace and he was not a "member of staff" within the meaning of cl 16(1). 25As Mr Pace was not a member of staff of the TAFE Commission, the Commission's jurisdiction in respect of Mr Pace was, and is, unaffected by cl 16(1).

Stay order 26As I earlier mentioned, the stay order has not been lifted or revoked. The order was expressed to be that: the orders in the decision of Commissioner MacDonald given on 18 October 2011 be stayed until further order of the Commission. 27It is perhaps arguable that the stay was lifted upon leave being granted to discontinue the appeal proceedings, there being no reason to continue the stay. However, I am inclined to the view that the stay order, having been made, remained effective until a further specific order was made revoking the stay order. I do not think an order of the Commission can be revoked by implication. If that is correct, the stay order is in place to this day. 28If the stay order is still in place, none of the orders sought by Mr Pace in his application for declaratory relief could be made in terms. For instance, an order could not be made that "...the Respondent is bound by the orders of the IRC" if one accepts that the "orders" referred to are the orders of MacDonald C, which must surely be the case. Those orders are stayed. That is, they have not been executed and, therefore, are not yet binding.

Jurisdiction to make first order sought 29Proceeding on the premise that the stay order will be revoked at some future time, the question becomes whether, in that event, the Court has jurisdiction to make the orders sought. As I have noted, the first order sought was "A Declaration that the Respondent is bound by the orders of the IRC." The order was not framed in the most precise terms, but it is clear enough, as I have found, that the reference to the "orders of the IRC" is a reference to those made by MacDonald C on 18 October 2011. Those orders, it will be recalled, were that: (a) Mr Alf Pace is to be reinstated by the managing Director, TAFE Commission into his former position occupied by him immediately prior to his dismissal. (b) The employment of Mr Pace is to be taken not to have been broken by his dismissal. (c) The orders of the Commission shall take effect within twenty-eight days from the date of this Decision. 30The Court has power to "make binding declarations of right in relation to a matter in which the Commission (however constituted) has jurisdiction." MacDonald C made an order under s 89(1) of the IR Act reinstating Mr Pace, a consequential order under s 89(4) that Mr Pace's period of employment had not been broken by the dismissal and an order specifying the date by which Mr Pace was to be reinstated. There is no doubt that in making these orders the Commissioner was exercising his power in relation to an industrial matter as defined in s 6 of the IR Act; it was an exercise of power within the Commission's jurisdiction. What the Court is now being asked is to make a declaratory order that the respondent, named as the TAFE Commission in the notice of motion, is bound by the Commissioner's orders. 31The words "in relation to" constitute an "expression of broad import": O'Grady v Northern Queensland Co Ltd [1990] HCA 16; (1990) 169 CLR 356 at 374 per Toohey and Gaudron JJ, although it imports a requirement for a relationship between subject matters: PMT Partners Pty Ltd (In Liq) v Australian National Parks and Wildlife Service [1995] HCA 36; (1995) 184 CLR 301 at 330 - 331. Even on a narrow reading of those words, however, a declaratory order to the effect the respondent is bound by Commissioner MacDonald's orders would be an order in relation to a matter in which the Commission has jurisdiction.

Discretionary considerations in respect of first order sought 32Accepting then, that the Court has jurisdiction to make the first order sought by Mr Pace, and assuming the stay order may be lifted, the question is whether the Court should exercise its discretion in the applicant's favour. 33Section 89(1) of the IR Act provides: (1) Reinstatement The Commission may order the employer to reinstate the applicant in his or her former position on terms not less favourable to the applicant than those that would have been applicable if the applicant had not been dismissed. 34The Court of Appeal considered that provision in Commissioner of Police for New South Wales v Lawrance & Anor [2011] NSWCA 377. At [50] Sackville AJA (Beazley P and McColl JA agreeing) stated: Section 89(1) of the IR Act empowers the IRC to order the employer (in this case the Commissioner) to " reinstate the applicant to his or her former position on terms not less favourable " than those that would have applied had the applicant been dismissed. To " reinstate " means to restore the applicant to the employment situation as it existed immediately before the applicant was removed from his or her position: Blackadder v Ramsey Butchering Services Pty Ltd [2005] HCA 22; 221 CLR 539, at 544 [14], per McHugh J; at 549-550 [33]-[34], per Kirby J; at 552-553 [43]-[46], per Hayne J; at 565 [75], per Callinan and Heydon JJ. Section 89(1) does not confer power on the IRC to do anything other than reinstate the applicant to his or her former position and to do so on " terms not less favourable " than those the applicant previously enjoyed. 35Assuming that the "Respondent" referred to in the first of the declaratory orders sought by Mr Pace is the New South Wales Government, the difficulty that arises is that whilst Mr Pace was a teacher employed by Government of New South Wales, his "former position" was in the TAFE Commission Division of the Government Service. That position no longer exists because the role of that Division has been transferred to the TAFE Commission, a constitutional corporation not subject to the jurisdiction of the Industrial Relations Commission of New South Wales. According to Lawrance, there can be no reinstatement because there is no "former position". On this basis there would be no utility in making the first order sought by the applicant. 36Moreover, a declaratory order to the effect that the respondent is bound by the order that "Mr Alf Pace is to be reinstated by the Managing Director, TAFE Commission..." would not be enforceable against the managing director because he or she was not the employer of Mr Pace. Mr Pace would have no "right" to be reinstated by the managing director. 37Assuming, in the alternative, that the "Respondent" referred to in the first of the declaratory orders sought by Mr Pace is the TAFE Commission (the amended application named the respondent as the "Technical and Further Education Commission T/A TAFE Commission"), the difficulties that arise are: (i) the TAFE Commission, not being subject to the Commission's jurisdiction, would not be bound by Commissioner MacDonald's reinstatement order and it would be unenforceable against that entity; and (ii) the TAFE Commission could not reinstate Mr Pace to his former position because the former position was not one provided for by the TAFE Commission. Again, there would be no utility in making the order sought. 38Sections 89(2) and 89(5) of the IR Act respectively provide: (2) Re-employment If the Commission considers that it would be impracticable to reinstate the applicant, the Commission may order the employer to re-employ the applicant in another position that the employer has available and that, in the Commission's opinion, is suitable. (5) Compensation If the Commission considers that it would be impracticable to make an order for reinstatement or re-employment, the Commission may order the employer to pay to the applicant an amount of compensation not exceeding the amount of remuneration of the applicant during the period of 6 months immediately before being dismissed. If the applicant was on leave without full pay during any part of that period, the maximum amount of compensation is to be determined as if the applicant had received full pay while on leave. 39Even if the Court had power to make a declaratory order in the alternative to the first order sought by the applicant, and which relied on ss 89(2) or 89(5), no such order was sought. 40Nevertheless, it seems to me that there may be utility in making an order, subject to the stay being lifted, that the Government of New South Wales (being the proper respondent before MacDonald C) is bound by the Commissioner's first order. For one thing, it would at least enable the applicant to seek to recover monies owed for the period between when the orders of MacDonald C took effect (at the latest on 15 November 2011) and 1 December 2011. It may also have utility if the applicant were to seek to amend the orders made by MacDonald C on the grounds that reinstatement is impracticable and consideration should be given to alternative relief. Given the orders of MacDonald C have not taken effect because of the stay order, it may be arguable no final orders have been made and that the Commission is at liberty to amend. 41The difficulty, however, is that the Government of New South Wales is not the named respondent in these proceedings: it is the TAFE Commission that filed a notice of appearance and appeared in the proceedings and that body is a separate entity to the Government. If I were to make such an order it would be in the absence of the Government of New South Wales having been given an opportunity to put its case. That would be a denial of natural justice. Accordingly, I decline to make the order.

Jurisdiction to make second order and discretion 42The second order sought by Mr Pace was "A Declaration that the Respondent bound (sic) by undertakings given to this Honourable Court". The "undertakings" referred to related to statements by the appellant's solicitor recorded in the transcript of proceedings on 15 November 2011 where the Commission was dealing with the question of a stay of MacDonald C's orders pending the appeal by Mr Pace's employer. The undertaking was that in the event the appellant was unsuccessful in its appeal it would pay to Mr Pace his salary from 15 November 2011, that is, the date by which he was to be reinstated according to the orders of MacDonald C, up to the date the appeal was determined. 43It may be concluded the appeal was unsuccessful because the appellant discontinued it on 14 February 2012. 44There would be no jurisdictional obstacle to making a declaration to the effect that the Government of New South Wales (which was the proper appellant in Matter No IRC 1723 of 2011) is bound by the undertaking or promise it gave in proceedings on 15 November 2011 that it would pay to Mr Pace his salary from 15 November 2011 up to the date the appeal was discontinued, namely, 14 February 2012. However, the same difficulty arises as with the first order: the Government of New South Wales has not been heard. 45The applicant's second order is refused.

Jurisdiction to make third order 46The third order sought by Mr Pace was that: Respondent pay the Applicant compensation. 47Apart from the fact the respondent on the notice of motion (the TAFE Commission) could never be held liable to pay compensation to Mr Pace because there was never any relevant relationship between the two, the Court's declaratory jurisdiction, whilst broad, does not extend to the making of orders in respect of a matter outside the Commission's jurisdiction. Other than in certain specified circumstances (for example, under s 89(5) s 106(5), s 270(1), s 314(4)) the Commission does not have power to make orders of a general nature for compensation. 48Even if the Court was inclined to the view that reinstatement was impracticable and a compensation order against the Government of New South Wales was appropriate under s 89(5), the Government has not been heard. In any event, this Court has no jurisdiction to make such orders (it being a matter for the Commission). 49The applicant's third order is refused.

Jurisdiction to make fourth order 50The fourth order sought by the applicant was that: The Respondent pay the Applicants (sic) costs. 51The Court's power to award costs is provided by s 181 of the Act. Costs are at the discretion of the Court. The applicant has been unsuccessful in his application. The Court makes no order as to costs.

Orders 52The Court makes the following orders: (1)The applicant's amended application is dismissed. (2)No order as to costs.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 19 May 2014

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