Restricted meaning of State Government Instrumentality
91 Before the trial Judge, the appellant submitted in the alternative that if the Trust was a State Government instrumentality within the ordinary meaning of the term, the ordinary meaning was not the proper meaning, having regard to the purpose lying behind the making of the 1994 Award, and that meaning also applied to the 2003 Award.
92 In order to understand the appellant's alternative submission as to the meaning to be attributed to the words, "State Government Instrumentality", it is necessary to say something about the history.
93 It seems that certain buildings on the Arts Centre land were completed in about 1981. From that time, a company called Kennedy Cleaning Services, which the Court was told was the present appellant's predecessor in the sense that it was an earlier name for the appellant, was engaged as a contractor to provide cleaning services in the Centre. The company hired its own employees and the Trust never directly employed cleaners. The cleaners employed by Kennedy Cleaning Services and, later, the appellant, were paid under the Building Services Award during the period it applied and were never paid, what in earlier days was called, a Supplementary Income Payment Scheme amount or SIPS.
94 Cleaners directly employed by the State Government were paid SIPS. At some point, the State Government commenced engaging contractors to perform the cleaning services in its buildings and those contractors employed the cleaners. The relevant award was amended so that the cleaners did not lose part of their existing benefits by reason of the State Government's change of practice.
95 In essence, the appellant's submission is that having regard to these facts (which, to this point, I have only mentioned in broad outline) the reference to State Government Instrumentality in the 1994 award should be read down so that it only applies:
1. "to ensure that superior terms and conditions of employment enjoyed by cleaners employed by the State of Victoria continued to apply when the State contracted out the cleaning of its premises" (the trial Judge's summary of the appellant's submission); or
2. "to the premises of a State Government department or instrumentality where cleaning work has been contracted out which was previously undertaken by direct employees of the department or instrumentality, who had an entitlement to a higher rate of pay (being a paid rate) than the rates prescribed in the minimum rates industry award; that is, the Building Services Award 1992 (Vic) and its predecessors" (the appellant's submission on appeal).
96 Having referred to the fact that, prior to 1992, the terms and conditions of employment in the contract cleaning industry were regulated pursuant to Victorian law and that the two main awards were the Building Services Award and the Building Services (State Government Departments and Instrumentalities) Award, the trial Judge made the following finding:
"In or about 1992, the Victorian Government began to contract out the cleaning of government premises. As a consequence, the applicant or one of its predecessor unions applied to the Industrial Relations Commission of Victoria to vary the Building Services (State Government Departments and Instrumentalities) Award. The variation sought was the insertion of a clause that would ensure that the conditions in that Award, which were superior to those in the Building Services Award, would continue to be available to employees cleaning government premises in Victoria, although those employees were employed by contractors and not by the State of Victoria itself. On 21 September 1992, Commissioner Pimm made an order, inserting into the Building Services (State Government Departments and Instrumentalities) Award a new clause, designated as cl 1A Incidence of Award. So far as is relevant to this proceeding, that clause provided:
'The Building Services (State Government Departments and Instrumentalities) Award applies to the whole of the State of Victoria for persons engaged in the provision of building services in the occupations of building attendant, caretaker, cleaner, lift attendant or security officer, howsoever designated, employed -
(a) By a contractor engaged by a State Government Department or Instrumentality.'"
97 Those findings are challenged by the respondent in a notice of contention it has filed. I will come back to that challenge but, for the moment, it is convenient to follow through the reasoning of the trial Judge.
98 The trial Judge next refers to the fact that when, on 29 October 1992, the Industrial Relations Commission of Victoria, in full session, made a new Building Services (State Government Departments and Instrumentalities) Award, to supersede the former award of that name, the incidence clause appeared in Part A of the Award.
99 The trial Judge referred to the "substantial flight from Victorian state awards to federal awards, as unions attempted to avoid new Victorian legislation". He referred to a decision of a Full Bench of the Commission on 25 October 1993 following a review of wage fixing principles. One of the principles for the making of first federal awards was as follows:
"In awards regulating the employment of workers previously covered by a State award or determination, existing State award rates and conditions prima facie will be the proper award rates and conditions."
100 The trial Judge then referred to the fact that following negotiations about the making of a federal award for the contract cleaning industry, the respondent entered into a memorandum of agreement on 16 March 1994 with the Australian Building Services Association, the Property Services Council of Australia, the Victorian Employers Chamber of Commerce and Industry, the Australian Chamber of Manufacturers and Eski Cleaning Services. The memorandum of agreement provided relevantly as follows:
"The parties agree:
1. To make a joint application for a Federal Award that preserves rates of pay and allowances as they were prescribed for the contract cleaning industry in the expired awards of the former Industrial Relations Commission of Victoria, known as the Building Services Award, the Building Services (State Government Departments & Instrumentalities) Award, the Miscellaneous Workers Post-Secondary Education (TAFE) Award and the Cleaners and Domestic Arts Assistants (Government Schools) Award.
2. That the Award made prescribe common conditions of employment for the industry, other than where to prescribe such common conditions of employment would result in a reduction in income contrary to Point 1 of this agreement.
It is acknowledged by the parties that the implementation of 1 and 2 of this agreement shall be staged as follows:
(a) An initial application to the Commission for a minimum rates award, the scope and Incidence of that award being in similar terms to the Incidence of the former Building Services Award.
(b) A second stage where the paid rates applicable in the former paid rates awards applicable to the cleaning industry are incorporated as separate parts into the Building Services Award'."
101 On 16 March 1994, a representative of the respondent told Deputy President Acton of the Australian Industrial Relations Commission that the respondent sought the making of an award in accordance with the memorandum of agreement. The representative said:
"The award that I would be asking that the commission make, arising out of today's proceedings is a minimum rates award, the incidence of which is in similar terms to the incidence of the former Building Services Award of the former Industrial Relations Commission of Victoria. There will be a second stage in the implementation of this agreement at which time the parties will approach the commission and seek to have the award which we would have made today, amended to incorporate rates of pay which were expressed in the former state awards known as the Building Services State Government Departments and Instrumentalities award, the Miscellaneous Workers Post-secondary Education TAFE Award, and the Cleaners and Domestic Arts Assistance Government Schools Award, and that will be the subject of subsequent application to the commission, and of course there will need to be detailed negotiations between the parties as to the final form of such variations to the award."
102 The representative also said that the proposed award reflected the situation as it was when the Building Services Conciliation and Arbitration Board and Building Services State Government Departments and Instrumentalities Conciliation and Arbitration Board had been restructured by a decision of the Industrial Relations Commission of Victoria on 7 March 1991. The Commission made the consent award sought by the respondent.
103 As foreshadowed to the Commission on 16 March 1994, a further application was made to the Commission to incorporate into the 1994 Award the specific rates derived from several former Victorian Awards, including the Building Services (State Government Departments and Instrumentalities) Award. The application, which was not opposed by representatives of the employers, was made on 20 July 1994 and it ultimately formed the basis of the introduction of cl 8A into the 1994 Award.
104 Having referred to the history, the trial Judge addressed the appellant's submission. He said:
"This history might be of some assistance to the respondent's case if there were any evidence that the non-repayment of rates specified in the Building Services (State Government Departments and Instrumentalities) Award to those employed as cleaners at the Victorian Arts Centre had ever been the result of a conscious decision not to apply those rates, or an awareness that, for some reason, they were inapplicable. For present purposes, I am prepared to accept that the construction of an award can be affected by a common understanding of the parties to it about a particular state of affairs. If such a common understanding existed when the award was made, it should not be departed from when the Court comes to construe the award at a subsequent time. Care must be taken, however, to distinguish a common understanding from common inadvertence. If the only reason why the government instrumentality rates were not paid at the Victorian Arts Centre was that neither the union nor the employer adverted to the possibility that there was an obligation to pay them, no common understanding results. In order to have an understanding, it is necessary that there be a meeting of minds, a consensus. There can be no meeting of minds, no consensus, if no-one has thought about the issue."
105 The trial Judge then said none of the witnesses called before him gave evidence of a common understanding. In his opinion, no one considered the status of the Trust and whether it was a State Government instrumentality for the purposes of either the earlier State award or the 1994 award.
106 The respondent submitted that this Court should not entertain the appellant's submission that the term, State Government Instrumentality should be given a meaning other than its ordinary meaning because this was a new argument raised for the first time on appeal. I reject that submission. It may well be that the argument now put is articulated in a different way and is put in more detail than it was below, but I am satisfied that it was not only put below, but was dealt with by the trial Judge. In any event, largely by agreement of the parties, this Court now has all of the material the respondent would wish to rely on to meet the appellant's argument.
107 The proper approach to the interpretation of the provisions of an award has been the subject of observations in the authorities. In George A Bond and C Ltd (in liq) v McKenzie [1929] AR (NSW) 498, Street J said (at 503-504):
"Now speaking generally, awards are to be interpreted as any other enactment is interpreted. They lay down the law affecting employers and employees in their relations as such, and they have to be obeyed to the same extent as any other statutory enactment. But at the same time, it must be remembered that awards are made for the various industries in the light of the customs and working conditions of each industry, and they frequently result, as this award in fact did, from an agreement between parties, couched in terms intelligible to themselves but often framed without that careful attention to form and draughtsmanship which one expects to find in an Act of Parliament. I think, therefore, in construing an award, one must always be careful to avoid a too literal adherence to the strict technical meaning of words, and must view the matter broadly, and after giving consideration and weight to every part of the award, endeavour to give it a meaning consistent with the general intention of the parties to be gathered from the whole award."
108 In Short v FW Hercus Pty Ltd (1993) 40 FCR 511, Burchett J said (at 518):
"The context of an expression may thus be much more than the words that are its immediate neighbours. Context may extend to the entire document of which it is a part, or to other documents with which there is an association. Context may also include, in some cases, ideas that gave rise to an expression in a document from which it has been taken. When the expression was transplanted, it may have brought with it some of the soil in which it once grew, retaining a special strength and colour in its new environment. There is no inherent necessity to read it as uprooted and stripped of every trace of its former significance, standing bare in alien ground. True, sometimes it does stand as if alone. But that should not be just assumed, in the case of an expression with a known source, without looking at its creation, understanding its original meaning, and then seeing how it is now used. Very frequently, perhaps most often, the immediate context is the clearest guide, but the court should not deny itself all other guidance in those cases where it can be seen that more is needed. In literature, Milton and Joyce could not be read in ignorance of the source of their language, nor should a legal document, including an award, be so read."
109 In Amcor Ltd v Construction, Forestry, Mining and Energy Union (2005) 79 ALJR 703 at 705 [2], Gleeson CJ and McHugh J referred to the fact that interpreting an industrial agreement turned on its language understood in the light of its industrial context and purpose.
110 French J discussed the proper approach to the interpretation of an award in City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union [2006] FCA 813 at [50]-[57]. His Honour made the point that it is not necessary to identify an ambiguity in the language under consideration before regard may be had to the purpose of the award.
111 The provisions of the Acts Interpretation Act 1901 (Cth) are also relevant: see s 46 and the Legislative Instruments Act 2003 (Cth) (see s 7(1) item 18 of that Act).
112 In considering the appellant's alternative submission, the following matters should be borne in mind. First, although it is not necessary to identify an ambiguity in the words used before reference may be made to contextual matters, the ordinary meaning of "State Government Instrumentality" is clear and there would need to be good reason to depart from it. Secondly, there was no evidence before the trial Judge and there is no evidence before this Court as to whether there were any other bodies at the relevant time which would be caught by the ordinary meaning but not by the more restricted meaning advanced by the appellant. Thirdly, the qualification the appellant seeks to place on the ordinary meaning of State Government instrumentality may itself be expressed in different ways and this is a weakness in the appellant's submission.
113 The evidence would seem to support the conclusion that the 1994 Award was intended to have no greater field of operation than the State awards it replaced. It then becomes necessary to look at the context in which the relevant State awards were made. In my opinion, there is no difficulty in saying that the purpose of the insertion of cl 1A (Incidence of Award) in the Building Services (State Government Departments and Instrumentalities) Award was to ensure that cleaners employed by contractors engaged by a State Government Departments or Instrumentalities were covered by that award. However, that leaves for consideration by reference to ordinary principles of construction the question of what was a State Government Department or instrumentality. The fact that the State Government may have started to contract out cleaning services may explain why the parties were moved to act, but it cannot control the meaning of the words used. Even if, in theory, it could have that effect, it is by no means clear on the evidence that that was the only purpose which motivated the amendment. In the absence of clear evidence of the purpose of the parties or the Industrial Relations Commission of Victoria, the appellant's submission must fail. In other words, it is open on the facts to conclude that the parties or the Commission were not directing their attention to what was a State Government Department or instrumentality but, rather, to the fact that, whatever the definition of such a body, a cleaner employed by a contractor engaged by such a body was to be in the same position as a cleaner directly employed by such a body.
114 In my opinion, the trial Judge was right to reject the appellant's alternative submission.
115 The respondent filed a notice of contention challenging the findings of the trial Judge set out in [96] above. The respondent submitted that there was no evidence that contracting out occurred in 1992 and that there was evidence that it occurred in the 1960's. The respondent submitted that there was no evidence that the variation of the Building Services (State Government Departments and Instrumentalities) Award was as a consequence of contracting out. The respondent submitted that there was no evidence that the variation sought was to ensure that the conditions in that award, which were superior to those in the Building Services Award, would continue to be available to employees cleaning government premises in Victoria, although those employees were employed by contractors and not by the State of Victoria itself. If these contentions are correct, there is even less support for the appellant's alternative submission because there is simply no evidence of the precise context or purpose.
116 Although it is not strictly necessary for me to consider the notice of contention, it is appropriate to say that I would have upheld it. In fairness to the trial Judge, the evidence as to the history of the relevant awards was not such that it facilitated the making of clear findings. Even with the additional information presented on appeal, the relevant history has not been clearly presented.
117 Mr Terrence Breheny is the assistant secretary of the respondent. He gave evidence that although he was not in a position to say that contract cleaning in the government sector commenced in the early 1960's, it was happening when he started employment with the Federated Miscellaneous Workers Union in 1982. Mr Breheny said that there was a common rule award from at least since 1982 which covered employees of cleaning contractors in State Government Departments and Instrumentalities. Mr John Lazzari is the group general manager of the appellant in Victoria and Tasmania. His evidence was that he first entered the contract cleaning industry in December 1962 and that, at about that time, the State Government started to outsource the cleaning of its own buildings and that was done through the Public Works Department. Mr John Grant was on the State Executive of the Building Services Contractors Association for 12 years, he was president of the State body for three years and on the national executive for eight years. He said that certain buildings occupied by government "went from in-house government cleaners in the late 1960's to being contracted out to contract cleaning companies".
118 On or about 14 March 1991 the Federated Miscellaneous Workers Union (Victorian Branch) applied to the Building Services (State Government Departments and Instrumentalities) Conciliation and Arbitration Board for the making of an award for the trades for which the Board was constituted. The background to the application was described by the chairperson of the Board (Ms J Bornstein) as follows:
"The application follows Decision D91/0067 of the Commission in Full Session which, on application by the FMWU; and arising from an agreement between the parties, abolished the Cleaners Conciliation and Arbitration Board, the Lift Conciliation and Arbitration Board and the Caretakers Conciliation and Arbitration Board at the conclusion of 13 March 1991 and established the Building Services (State Government Departments and Instrumentalities) Conciliation and Arbitration Board to operate on and from 14 March 1991. The jurisdiction of the Board applies to:
'Persons engaged in the provision of building services in the occupations of building attendant, caretaker, cleaner and lift attendant a security officer howsoever designated -
(a) By a contractor engaged by a State Government Department or Instrumentality, or
(b) Pursuant to s 41A of the Public Service Act 1974, by a State Government department; or
(c) By a State Government Instrumentality
The jurisdiction of the Board does not apply to persons subject to the jurisdiction of the Boarding School Employees Board, the Builders Labourers Board, the Cleaners and Domestic Arts Assistants (Government Schools) Board and the Miscellaneous Workers Post-Secondary Education (TAFE) Board, and persons, engaged other than by a contractor, who are covered by the Health and Allied Services Board or the Restaurant, Catering and Accommodation Board.'"
119 On 14 March 1991, the Board resolved to make an award to incorporate the jurisdiction of the Board and to incorporate all provisions of, inter alia, the Cleaners Award. In her reasons, the chairperson said:
"The award of the Board ensures that, as a consequence of the abolition of three pre-existing Boards and the creation of the Building Services (State Government Departments and Instrumentalities) Board, continuity of rates of pay, conditions of employment and other provisions previously applicable to Cleaners, Caretakers, Lift attendants and Security Employees employed in the State Government Departments and Instrumentalities previously covered by the jurisdiction of the Cleaners, Caretakers, Lift and Security Employees Conciliation and Arbitration Boards, are maintained through the creation of a new four part award which is identical in all respects, save for jurisdiction, to the pre-existing Cleaners, Caretakers, Life and Security Employees Awards. The operative date of the award of 14 March 1991 also ensures that continuity prevails."
120 An award of the Board was made accordingly.
121 In the reasons of the Industrial Relations Commission of Victoria in Full Session dated 29 September 1992, the Commission referred to the initial award made on 14 March 1991 and said that it reflected provisions which applied under pre-existing awards, and it referred to the over-award payments made under the SIPS.
122 Furthermore, it would seem to be relevant to the history that the order made by Commissioner Pimm on 21 September 1992 inserting cl 1A (Incidence of Award) was made in the context of the abolition of conciliation and arbitration boards on or about 1 August 1992 so that there was nothing, absent an incidence of award clause, to define the scope of the Building Services (State Government Departments and Instrumentalities) Award.
123 Having regard to no more than the evidence I have outlined, it seems to me that contracting out by the Victorian State Government commenced before 1992, and probably well before that time, and that there was an award providing for payment of the supplementary payment to cleaners employed by a contractor engaged by a State Government Department or Instrumentality before 1992, perhaps some time before that date. If that is so, then, as I have said, there would be even less support for the appellant's alternative submission because there is no evidence of the circumstances surrounding the making of the relevant amendment to the award. However, it is not necessary to pursue the notice of contention further because the decision of the trial Judge should be upheld on the findings made by him.