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[2013] NSWIRComm 53
Industrial Relations Commission (NSW)
2013-06-17
Boland J, Walton J
Original judgment source is linked above.
Background to the legislation 46We mentioned earlier the principle that whilst consideration of extrinsic materials should not displace the clear meaning of the text of a provision, the purpose of a provision may be elucidated by appropriate reference to them. 47The employer parties are undoubtedly correct in submitting that the purpose of s 146C and the Regulation was to "limit employment costs in the public sector" and to achieve "fiscal restraint". As we noted earlier, Full Benches of this Commission have recognised that purpose. It is evident from the Minister's Second Reading Speech that the Government was concerned to limit the Commission's discretion under the Act in the making of awards and orders so that any increase to public sector wages and salaries and changes to employment conditions was in accordance with the Government's view as to what were appropriate adjustments. 48In the second reading speech the Minister gave an example of the 2008 public servants' salaries case where the previous government accepted the Commission's non-binding recommendation for the settlement of the PSA's claim at the time. The recommendation provided for increases of 4 per cent per annum over three years and once the parties had agreed on that outcome the Commission made appropriate orders varying the relevant awards. This was said to be an example of the Commission rejecting key aspects of the previous government's wages policy, such policy, it might be noted, being aspirational and having no particular status at law in contrast to the Act, which imposed certain functions and duties on the Commission as to how it was to exercise its award making powers. 49Hence, it is apparent that the current Government felt compelled, in the interests of fiscal restraint, to limit the Commission's discretion and to direct the Commission as to what was an appropriate outcome. It did so in the form of s 146C and the Regulation, both which have been held to be constitutionally valid: The Public Service Association and Professional Officers' Association Amalgamated of NSW v Director of Public Employment [2012] HCA 58; (2012) 293 ALR 450 and Public Service Association and Professional Officers' Association Amalgamated Union of NSW v Director of Public Employment [2011] NSWIRComm 143. 50We refer to this background because it assists in understanding the purpose of the legislation, in placing the text in context and in determining whether there is any support for a particular interpretation of the text of the legislation in question. 51In the present case the background to the legislation demonstrates quite clearly that in seeking to achieve fiscal restraint and to manage its Budget according to its priorities, the Government was concerned to do that through the mechanism of limiting the Commission's powers to make orders or awards that increased employee-related costs by more than 2.5 per cent unless any increase beyond 2.5 per cent was offset by employee-related cost savings. That is to say, any increase in remuneration or conditions of employment awarded by the Commission (by way of an order or award) is not to increase employee-related costs by more than 2.5 per cent per annum. 52There is no indication in any of the extrinsic material that suggests it was the legislature's intention in promulgating the Regulation that, in addition to limiting the Commission's powers in the manner described, the ceiling of 2.5 per cent per annum was to be subject to discounting in circumstances where employee-related costs, derived from some source other than an award or order of the Commission, exceeded 2.5 per cent.
Finding 53We find that having regard to our textual analysis of cl 6(1)(a) of the Regulation, the context in which that text appears in the Regulation, the purpose of s 146C and the Regulation and the extrinsic materials that assist in elucidating the purpose of cl 6(1)(a), the increases in remuneration or other conditions of employment referred to in that provision are only those increases resulting from an award or order made or varied by the Commission either by consent or in arbitration proceedings.
Paramount policies 54Reference was made to the paramount policies in cl 5 of the Regulation, one of those being that "Public sector employees are entitled to the guaranteed minimum conditions of employment (being the conditions set out in clause 7)". The "guaranteed minimum conditions of employment" in cl 7 include "employer payments to employee superannuation schemes or funds (being the minimum amount prescribed under the relevant law of the Commonwealth)". 55As we have made plain, what the employer parties seek to do is offset the 2.5 per cent increase in cl 6(1)(a) of the Regulation by the amount of increase in the superannuation charge percentage that is a "guaranteed minimum condition of employment". 56We do not find it necessary to determine this issue in light of our finding regarding the interpretation of cl 6(1)(a). We would observe, however, it does seem curious in the absence of any express intention, that the legislature's intention was to defray any increase in the cost of guaranteed minimum employment conditions by reducing the amount of wage increase available under cl 6(1)(a). There is some merit in the PSA's submission that the guaranteed minimum conditions and the benefit bestowed under cl 6(1)(a) are separate and distinct entitlements and that the 2.5 per cent limit on increases in remuneration or other conditions of employment under cl 6(1)(a) applies only to increases that exceed the "guaranteed minimum conditions of employment", including the making of minimum employer superannuation contributions required by Commonwealth law.
Directions 57The applications that are the subject of these proceedings are referred to Boland J, President for the purpose of disposing of them in accordance with this decision. 58The applications are listed before his Honour at 10.00 am on Friday, 5 July 2013. In the meantime, the parties are directed to confer on the extent of any agreement or disagreement regarding the applications with a view to presenting the Commission with a consent position if that is practicable.
Amendments 26 June 2013 - Appearance omitted Amended paragraphs: Coversheet 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: 26 June 2013
Approach to statutory interpretation 21A Full Bench of this Commission recently considered the correct approach to statutory interpretation in Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales and Department of Education and Communities [2013] NSWIRComm 32 at [24]. In doing so, the Full Bench referred to three decisions of the High Court, namely, Certain Lloyd's Underwriters Subscribing to Contract No IH00AAQS v Thelander [2012] HCA 56; (2012) 293 ALR 412, Australian Education Union v Department of Education and Children's Services [2012] HCA 3; (2012) 285 ALR 27 and Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32; (2012) 220 IR 445; (2012) 290 ALR 647. The key principles distilled by the Full Bench from these authorities were as follows: (1) The legal meaning of a provision of a statute is to be ascertained by processes of statutory construction: Certain Lloyd's Underwriters at [25] per French CJ and Hayne J. Thus, the fundamental object of statutory construction is to ascertain legislative intention: Certain Lloyd's Underwriters at [88] per Kiefel J. However, the use of the metaphor 'legislative intention' must not mislead. This expression must be understood as the intention that the courts will impute to the legislature by a process of construction: Certain Lloyd's Underwriters at [88] per Kiefel J. The duty of a court is to give the words of a statutory provision the meaning that the legislature is taken to have intended them to have: Certain Lloyd's Underwriters at [25] per French CJ and Hayne J (applying Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28; (1998) 194 CLR 355; (1998) 72 ALJR 841; (1998) 153 ALR 490 at [78] per McHugh, Gummow, Kirby and Hayne JJ); (2) Ordinarily, the legal meaning of a provision of a statute will correspond with the grammatical meaning, but not always: Certain Lloyd's Underwriters at [25] per French CJ and Hayne J and at [68] per Crennan and Bell JJ (applying Project Blue Sky at [78] per McHugh, Gummow, Kirby and Hayne JJ). Nontheless, the process of statutory construction must begin with a textual analysis of the words of a provision - that is, a consideration of the ordinary and grammatical meaning of the words: Australian Education Union at [26] per French CJ, Hayne, Kiefel and Bell JJ; Barclay at [41] per French CJ, Crennan, Gummow and Hayne JJ; Certain Lloyd's Underwriters at [23] per French CJ and Hayne J. Although that initial step may involve the construction of the words of a provision in question when read in the context of the statute as a whole: Certain Lloyd's Underwriters at [88] per Kiefel J. Thus, the legal meaning is ascertained by reference to the language of the statute viewed as a whole: Certain Lloyd's Underwriters at [26] per French CJ and Hayne J and [88] per Kiefel J. The purpose of the statute resides in its text and structure: Certain Lloyd's Underwriters at [25] per French CJ and Hayne J; (3) Context may also be considered "in a broader sense as including the general purpose and policy of the legislation, in particular the mischief to which the statute is directed and which the legislature intended to remedy.": Certain Lloyd's Underwriters at [88] per Kiefel J; (4)The context and purpose of a provision are important to its proper construction. Legal meaning may be ascertained by reference to general purpose, consistency and fairness: Certain Lloyd's Underwriters at [24] per French CJ and Hayne J; (5) The determination of the purpose of a statute or a particular statutory provision may be based upon an express statement of purpose in the statute itself, inference from its text and structure and, if appropriate, reference to extrinsic materials: Certain Lloyd's Underwriters at [25] per French CJ and Hayne J. Whilst consideration of extrinsic materials should not displace the clear meaning of the text of a provision, the purpose of a provision may be elucidated by appropriate reference to them: Certain Lloyd's Underwriters at [70] per Crennan and Bell JJ; (6) It is conceivable that the context of the words, the consequences of a literal or grammatical construction, the purpose of the statute or the canons of construction may require the words of a legislative provision to be read in a way that does not correspond with their literal or grammatical meaning: Certain Lloyd's Underwriters at [68] per Crennan and Bell JJ quoting Project Blue Sky at [78] per McHugh, Gummow, Kirby and Hayne JJ; (7) Determination of a statutory purpose neither permits nor requires some search for what those who promoted or passed the legislation may have had in mind when it was enacted: Certain Lloyd's Underwriters at [25] - [26] per French CJ and Hayne J and [70] per Crennan and Bell JJ. In construing a statute it is not for a court to construct its own idea of a desirable policy, impute it to the legislature, and then characterise it as a statutory purpose: Australian Education Union at [27] - [28] per French CJ, Hayne, Kiefel and Bell JJ. 22We adopt those principles for the purpose of these proceedings and we note that both the PSA and the Secretary accepted that the summary of principles in Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales and Department of Education and Communities was a proper reflection of the law.
Ordinary and grammatical meaning of words in cl 6(1)(a) 26Consistent with the High Court authorities referred to above, the process of statutory construction must begin with a textual analysis of the words of a provision - that is, a consideration of the ordinary and grammatical meaning of the words. Context may also be considered "in a broader sense as including the general purpose and policy of the legislation, in particular the mischief to which the statute is directed and which the legislature intended to remedy". Whilst consideration of extrinsic materials should not displace the clear meaning of the text of a provision, the purpose of a provision may be elucidated by appropriate reference to them: Certain Lloyd's Underwriters at [70] per Crennan and Bell JJ. 27Moreover, we agree with the PSA's submission that: It is relevant to the process of construction that the effect of section 146C and the Regulation is to limit the jurisdiction of the Commission. The conferral on a court or tribunal of a statutory power to make orders should be construed broadly, not confined by implications not apparent from the words of the conferral themselves: Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue (Vic) (2001) 207 CLR 72 at [11]; Owners of Shin Kobe Maru v Empire Shipping Company Inc (1994) 181 CLR 404 at 421; Knight v FP Special Assets Ltd (1992) 174 CLR 178 at 185, 202-203 and 205. A conferral of jurisdiction upon a court or tribunal will not be taken to have been withdrawn, unless the withdrawal of jurisdiction is clear and unmistakeable. In this last respect, the PSA referred to Shergold v Tanner [2002] HCA 19; (2002) 209 CLR 126 at [34]. 28Clause 6(1)(a) of the Regulation provides: Public sector employees may be awarded increases in remuneration or other conditions of employment that do not increase employee-related costs by more than 2.5% per annum (our emphasis). 29 Public sector employees may be awarded increases in remuneration or other employment conditions, but it is those "awarded increases" "that" are not to increase employee-related costs by more than 2.5 per cent per annum. The increase in the superannuation charge percentage of 0.25 per cent is not an "awarded increase"; it is an increase that has no connection whatsoever with an order or award of the Commission. It is an increase derived from Commonwealth legislation. 30This approach to the construction of cl 6(1)(a) is supported by cl 6(1)(b), which declares as a policy that "Increases in remuneration or other conditions of employment that increase employee-related costs by more than 2.5% per annum can be awarded", but "only if sufficient employee-related costs savings have been achieved to fully offset the increased employee-related costs." It is clear that the increases in remuneration, etc, that increase employee-related costs are those increases awarded by the Commission. 31Further support is found in s 146C(1), which requires the Commission, "when making or varying any award or order", to give effect to any policy on conditions of employment "that is declared by the regulations to be an aspect of government policy that is required to be given effect to by the Commission" and "applies to the matter to which the award or order relates." That is, as the PSA submitted, s 146C(1) (and any policy declared by Regulation) is directed only at the making or varying of an award or order by the Commission.
(2012) 285 ALR 27
(2012) 220 IR 445
(2012) 290 ALR 647
(2012) 293 ALR 412
(2011) 208 IR 201
(2011) 210 IR 458
(2002) 209 CLR 126
(2012) 293 ALR 450
(1998) 194 CLR 355
(1998) 72 ALJR 841
(1998) 153 ALR 490
(2001) 207 CLR 72
(1994) 181 CLR 404
(1992) 174 CLR 178
[2012] HCA 3