Re Pacific Coal Pty Limited; Ex parte: Construction, Forestry, Mining and Energy Union [2000] HCA 34

Re Pacific Coal Pty Limited; Ex parte: Construction, Forestry, Mining and Energy Union [2000] HCA 34 - HCA 2000 case summary — Zoe

[14]

GLEESON CJ. In Federated Saw Mill &c Employés of Australasia v James Moore & Son Proprietary Ltd[1], O'Connor J traced the history of the growing acceptance, during the latter part of the nineteenth century, of the idea that governments should make provision for what would now be called dispute resolution in relation to industrial differences. Before Federation in Australia, legislation was enacted in England, New Zealand, and two of the Australian colonies, setting up public tribunals for the purpose of settling industrial disputes by conciliation and arbitration. O'Connor J described the power intended to be conferred by s 51(xxxv) of the Constitution as a "power to create tribunals invested with jurisdiction to prevent and settle by conciliation and arbitration industrial disputes" extending beyond the limits of any one State. Similarly, Taylor J, in The Queen v Kirby; Ex parte Boilermakers' Society of Australia[2], described the power as one with respect to "the establishment and maintenance of a system, in some form or other, of conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one State".
It is for Parliament to determine the structure and incidents of the system of dispute resolution (using that expression to cover prevention as well as settlement) which is appropriate to current circumstances, subject to the limitations imposed by the terms of s 51(xxxv): the available methods of dispute resolution are conciliation and arbitration; and the disputes must be of a certain kind. The Constitution confers the power to establish and maintain, and, where it is considered appropriate, alter, the system. The Parliament, in the exercise of the power, legislates to institute, vary, modify, or abrogate, the system. The nature of a particular legislative scheme set up in the exercise of the power is not to be confused with the scope of the power itself.
These proceedings result from a decision by the Parliament to change a system of industrial dispute resolution which operated for many years. The arguments relate to some only of the changes; others are conceded to be legally effective.
The two proceedings before the Court challenge the validity of s 3 of the Workplace Relations and Other Legislation Amendment Act 1996 (Cth) ("the WROLA Act") in so far as it purports to give effect either to item 50 in Pt 2 of Sched 5 to that Act or to subitems 51(1), (2) and (3) in the same Part. The first proceeding is an application for writs of certiorari, mandamus and prohibition against the members of the Australian Industrial Relations Commission ("the Commission"); the second is a question reserved for the opinion of the Full Court in a suit commenced in the original jurisdiction.
The WROLA Act was intended to make substantial alterations to the system of industrial dispute resolution in force under the Industrial Relations Act 1988 (Cth), which became the Workplace Relations Act 1996 (Cth) ("the Act"). Schedules to the WROLA Act set out amendments to the legislation.
Before considering the alterations, it is convenient to refer to one feature of the Act which explains the form of some of the amendments. The outcome of a process of arbitration undertaken pursuant to the Act may be the making of an award. The arbitral authority, the Commission, expresses in its awards an opinion as to what the rights and obligations of parties, for the future, should be. What gives legal effect to the award is the statute. It is the Act itself "which gives to an award statutory operation as a prescription of industrial conduct within the area of the dispute which the award settles"[3]. By virtue of s 149 of the Act, awards are binding on parties to the industrial dispute or persons notified thereof, as well as all organisations and persons on whom the award is binding as a common rule and all members of organisations bound by the award. Part VIII of the Act deals with compliance with award provisions. Various provisions of the Act govern the effect of the award, including the period for which it has such effect. (The award the subject of the present case, when it was made, was stated to operate for only six months. It owes its continuing operation to s 148 of the Act.)
The main purpose of the alterations to the system of dispute resolution effected by the WROLA Act was to expand the role of conciliation, involving workplace agreements or enterprise bargaining, and to diminish the role of arbitration.
Item 11 in Pt 1 of Sched 5 to the WROLA Act inserted into the Act s 89A, which took effect from 1 January 1997. The effect of s 89A is to restrict the scope of industrial disputes and thereby to limit the range of "allowable award matters". Sub-section (1) provides:

[19]

The matters covered by s 89A(2) include hours of work, rates of pay, annual leave, long service leave, penalty rates, redundancy pay and superannuation. They do not include a variety of matters which have, in the past, commonly been the subject of awards.
Section 89A(3) provides that the Commission's power to make an award dealing with matters covered by sub-s (2) is limited to making a minimum rates award.
Thus, as from 1 January 1997, the amending legislation restricted the award-making power of the Commission.
The validity of s 89A is conceded. It is the provisions dealing with matters that are now not allowable award matters, where such matters were already included in awards previously made by the Commission under the Act, which are challenged.
The proceedings were instituted by a union which is a registered organisation of employees, and one of its members, and arise out of proceedings in the Commission, pursuant to the amending legislation, directed (amongst other things) at removing matters which are not allowable award matters from an award concerning the coal mining industry.
The way in which the WROLA Act dealt with existing awards, made before 1 January 1997, containing matters that are not allowable award matters, may be summarised as follows. In brief, the object was to limit the effect given by the statute to such awards by confining that effect to allowable award matters.
Part 2 of Sched 5 of the WROLA Act established an interim period, ending on 30 June 1998. Item 49 of Pt 2 provided for variation of an award during the interim period. If a party to an award applied to the Commission for variation of an award, the Commission was empowered to vary the award so that it dealt only with allowable award matters. This has been referred to as a process of award simplification. It was possible for a new industrial dispute to arise during this interim period, resulting in a new award. Such a dispute might have been the consequence of the simplification process. The Commission was required, by item 49, to deal with an application for review by arbitration, if satisfied that those applying for variation had made reasonable attempts to reach agreement with the other parties to the award about how the award should be varied and the treatment of matters that are not allowable award matters. The review was to be conducted by reference to certain criteria.
The manner in which parties to awards would conduct themselves during the interim period would, no doubt, be influenced by what they knew was to occur at the end of the interim period.
Item 47 of Sched 5 stipulated that in exercising its powers under Pt 2, the Commission must have regard to the desirability of assisting parties to awards to agree on appropriate variations to their awards, rather than have parts of awards cease to have effect under item 50.
Subitem 50(1) of Pt 2 of Sched 5 provides:

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It is argued that s 3 of the WROLA Act, in so far as it purports to give effect to item 50 or subitems (1) (2) and (3) of item 51, is invalid, for the reason that it is not a law with respect to conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one State.
It is not in dispute that, if such legislation applied only to future awards, it would be valid as a law within s 51(xxxv). It is also accepted that Parliament could, at the same time, legislate to deprive all existing awards of any effect. But, it is said, what Parliament cannot do in relation to past awards is leave them with effect in relation to some of their provisions, and at the same time, deprive other provisions of effect, and require that they be removed. The reason is said to be that legislation of that kind involves the direct legislative imposition of a new and different settlement of the dispute which led to the original award, and this is beyond the power conferred by s 51(xxxv). It amounts to an attempt to legislate directly as to wages or other terms or conditions of employment. In elaboration of the argument, it is contended that such legislation interferes with the settlement effected by the Commission and alters what might well have been a balance struck, involving an element of give and take in relation to various matters covered by the award. The outcome, it is argued, has been altered from one arbitrated by the Commission to one determined, or partly determined, by Parliament. Whilst it is within the power of Parliament to negate the whole settlement, by depriving it of any effect, it cannot alter the settlement by continuing to give effect to only part of it.
Such an argument does not do complete justice to the legislative context in which items 50 and 51 take their place. Those items came into effect (assuming the validity of s 3) only after an interim period of eighteen months. During that period, items 47 and 49 applied, and, in addition, the parties to an award were able to make their own assessments of the industrial consequences of the impending ineffectiveness of parts of the award, and to respond accordingly. Even so, the substance of the argument must be addressed. The issue is not about the merits of the legislation. It is about its character.
In certain respects, the submissions advanced against validity are similar to those which were unsuccessful in Waterside Workers' Federation of Australia v Commonwealth Steamship Owners' Association[4]. They are forcefully expressed in the dissenting judgment of Isaacs and Rich JJ.
That case was about s 28(2) of the Commonwealth Conciliation and Arbitration Act 1904 (Cth). That section had the effect that, when the period of operation of an award specified in the award expired, then, unless the Court of Conciliation and Arbitration otherwise ordered, the award would continue in force until a new award was made. It applied to existing awards. The dissentients, Isaacs and Rich JJ, made the point that the effect of the section was, by direct legislative provision, to impose on the parties an industrial regime which, in relation to the period of its operation, (a matter that, in a given case, could be important to the settlement effected by the award), was different from that formulated by the arbitral authority. The majority upheld the validity of the provision. Knox CJ[5] treated s 28(2) as a limitation imposed by the Parliament upon the power conferred on the Court of Conciliation and Arbitration to settle disputes. It imposed a condition (related to the time of operation of an award) subject to which the arbitral power was to be exercised. He saw in the legislation no attempt to prescribe conditions of employment by legislative enactment. Starke J said[6]:

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If a law giving force to an award, or depriving an award of force, or specifying the period during which an award shall have force, bears the character referred to by Starke J, it is difficult to see why a law depriving part of an award of force does not bear the same character.
It has been held that Parliament may widen the effect of the provisions of an award. Section 24 of the Commonwealth Conciliation and Arbitration Act 1904 (Cth) was amended by the Commonwealth Conciliation and Arbitration Act 1921 (Cth) to make agreements under that section binding on "any successor, or any assignee or transmittee of the business of a party bound by the agreement". The amendment was held to be valid in George Hudson Ltd v Australian Timber Workers' Union[7].
The practical result achieved by the legislation the subject of the two cases last mentioned turned upon the consideration that, under the legislative scheme by which Parliament had chosen to exercise the power given by s 51(xxxv), the legal effect of an award depended upon, and was governed by, the provisions of the statute. In each case, when awards were made by the arbitral authority in settlement of a dispute, their legal effect was extended by statute. Legislation extending the legal effect of an award made by an arbitrator in settlement of an industrial dispute is a law that bears the character of a law with respect to conciliation and arbitration for the prevention and settlement of industrial disputes. The same is true of legislation restricting the legal effect of such an award.
It has often been pointed out that s 51(xxxv) does not empower the Parliament to legislate directly to regulate conditions of employment[8]. An attempt was made in argument to develop that proposition by adding to it what was described as "[t]he principle that Parliament cannot do indirectly what it cannot do directly". Two points need to be made about that. First, it is one thing to say that the nature of the power is such that it deals with instituting and maintaining a system of conciliation and arbitration, and that it is only through such a system that conditions of employment may be regulated under s 51(xxxv); it is another thing to find some negative implication amounting to a prohibition against the Parliament enacting any law which has the effect of altering conditions of employment. That there is no such negative implication, and no such prohibition, must follow from the acceptance that, where Parliament can rely upon some other power conferred by s 51, it can legislate in relation to conditions of employment. Such an implication was rejected, for example, in Pidoto v Victoria[9]. In the present case, an attempt was made to rely, if necessary, upon the power conferred by s 51(xx). It is unnecessary to deal with that attempt but if, in a given case, legislation were validly enacted pursuant to that power, then it would not be affected by any negative implication or prohibition of the kind mentioned. Secondly, there is no principle that Parliament can never do indirectly what it cannot do directly. Whether or not Parliament can do something indirectly, which it cannot do directly, may depend upon why it cannot do it directly. In law, as in life, there are many examples of things that can be done indirectly, although not directly. The true principle is that "it is not permissible to do indirectly what is prohibited directly"[10]. If there were a constitutional prohibition of the kind earlier considered, then it could not be circumvented by an attempt to do indirectly that which is prohibited directly. There is, however, no such prohibition.
Reference was made in argument to Kartinyeri v Commonwealth[11], and to the effect of item 50 as a partial repeal of s 149. It was argued that s 149, as affected by such partial repeal, would no longer bear the character of a law with respect to the subject matter described in s 51(xxxv). This contention rests upon an unacceptably narrow reading of the words "with respect to"[12]. It also appears to treat as the subject of s 51(xxxv) the settlement of a particular dispute resulting from an arbitration, rather than a system of dispute resolution. We are not here concerned with a question of the power of the Commission to vary an award[13]. We are concerned with the power of the Parliament to alter the legal effect given to awards.
The order nisi should be discharged with costs. The question which asks whether s 3 of the WROLA Act is invalid in so far as it purports to give effect to item 50 or subitems 51(1), (2) and (3) should be answered in the negative. The plaintiffs should pay the defendant's costs of the stated case.
GAUDRON J. These matters were heard together. In the first matter, the Construction, Forestry, Mining and Energy Union ("the Union") and one of its members, Garry William Barnes, seek to have made absolute an order nisi for certiorari, prohibition and mandamus. They seek an order absolute for prohibition to prevent members of the Australian Industrial Relations Commission ("the Commission"), Pacific Coal Pty Limited ("Pacific Coal") and other corporations from giving effect to or relying upon certain decisions and orders of the Commission; for certiorari to quash those decisions and orders; and for mandamus to compel the Commission to hear and determine according to law the applications in respect of which those decisions were given and orders made.
As a result of the decisions in question, the Commission ordered the deletion of various provisions from the Coal Mining Industry (Production and Engineering) Consolidated Award 1997 ("the Award"). As amended, the order nisi for prohibition asserts that the decisions and orders of the Commission were beyond jurisdiction by reason that, to the extent that s 3 of the Workplace Relations and Other Legislation Amendment Act 1996 (Cth) ("the WROLA Act") purports to give effect to item 50 and subitems 51(1), (2) and (3) in Pt 2 of Sched 5 to that Act, it is invalid.
In the second matter, the Union and Mr Barnes seek a declaration that the provisions in issue in the first matter are invalid. The second matter came before the Full Court by way of a question reserved pursuant to s 18 of the Judiciary Act 1903 (Cth)[14]. As amended, that question asks whether s 3 of the WROLA Act is invalid in so far as it purports to give effect either to item 50 in Pt 2 of Sched 5 to that Act or to subitems 51(1), (2) and (3) in the same Part.

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There are three general matters that should be noted at the outset with respect to s 51(xxxv) of the Constitution. First, the power to make laws with respect to "conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one State" clearly extends to laws dealing with the processes of conciliation and arbitration, including the authorisation of persons or bodies to perform those functions, and the specification of "the manner in which, and the conditions on which, [they are to] carry out [those] functions"[20]. In this regard, Parliament may make it a condition of the discharge of the functions of conciliation and arbitration that certain matters are or are not to be the subject of one or other or both of those processes. Thus, for example, it may legislate so as to limit the matters that may be the subject of arbitration, or of award provision, so long as the resulting law has the character of a law with respect to conciliation and arbitration for the prevention or settlement of interstate industrial disputes.
The second matter that should be noted is that s 51(xxxv) is not concerned exclusively with the processes of conciliation and arbitration. Those processes lie at the heart of the legislative power conferred by s 51(xxxv) of the Constitution. But as with every legislative power conferred by the Constitution, s 51(xxxv) carries with it the power to enact legislation which is "appropriate to effectuate the exercise of [that] power"[21] - the "implied incidental power", as it has come to be known[22].
The third matter that should be noted with respect to the legislative power conferred by s 51(xxxv) is that, as with other legislative powers, it is not only a power to legislate but, also, a power to repeal or partially repeal earlier laws passed pursuant to that power[23]. However, a question may arise, when an Act purports to partially repeal an earlier Act, whether, if amended, that earlier Act would retain the character which gave it its constitutional validity[24]. If it would not, other questions arise. Those questions will be considered later in these reasons.
It was argued for the respondents in the first matter and the defendant in the second matter that s 3 of the WROLA Act, to the extent in issue in these proceedings, is valid by reason that it is incidental to the power conferred by s 51(xxxv) of the Constitution. Additionally, it was argued that it is valid because it is simply a law that amends or repeals a law validly enacted under s 51(xxxv).

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If the purpose of a legislative measure is to achieve an end within power, then, subject to a qualification shortly to be mentioned, it is within the implied incidental power or, more accurately, it is a law with respect to the subject-matter of the legislative power in question[28]. To ascertain whether a law is within power, it is often necessary to determine whether it has the purpose which is claimed for it. And to ascertain whether it has that purpose, it is sometimes convenient to ask whether it is appropriate and adapted[29] or reasonably capable of being viewed as appropriate and adapted[30] to that purpose. If it is not, it may be taken that it does not have that purpose but has some other and different purpose[31].
There are, however, occasions when the apparent purpose of a law can be ascertained from its terms or its operation. If its terms or its operation reveal a purpose within power, it may still be necessary to ask whether the law in question is appropriate and adapted or reasonably capable of being viewed as appropriate and adapted to that purpose. That is because of the qualification earlier referred to. The qualification is this: a law which has as its purpose some object that is within power will, nonetheless, not be a law with respect to the subject-matter of that power if it is not appropriate and adapted or reasonably capable of being viewed as appropriate and adapted to that purpose[32]. It may be that the better view is not that there is a qualification of the kind stated but that a law which is apparently directed to achieving an end within power will be shown, if it is not appropriate and adapted to that purpose, to have some other purpose which is beyond power.
It is convenient, in light of what has been written, to deal first with the argument that s 3 of the WROLA Act, so far as it purports to give legal effect to item 50 in Pt 2 of Sched 5, is within the implied incidental power because it is appropriate and adapted to the prevention of future disputes. To say that s 3 is, to the extent in issue, appropriate and adapted to the prevention of future disputes is simply to say that it is, to that extent, a law for the prevention of future disputes. But that is not sufficient to bring a law within s 51(xxxv) of the Constitution.
Section 51(xxxv) does not authorise laws for the prevention and settlement of interstate industrial disputes. It authorises laws with respect to the means to be employed for their prevention and settlement, namely, conciliation and arbitration[33]. Thus, even if it can be said that s 3, to the extent presently in issue, is a law for the purpose of preventing future industrial disputes extending beyond the limit of any one State, that does not give it the character of a law with respect to conciliation and arbitration. Accordingly, the argument that s 3 is valid to the extent in issue because it is appropriate and adapted to the prevention of future disputes must be rejected.
The argument that, to the extent in issue, s 3 is within power because there is a relevant connection between the original settlement of the dispute and the award as varied by operation of item 50 in Pt 2 of Sched 5 to the WROLA Act invites some general, preliminary observations. The first is that Parliament does not have power to legislate with respect to settlements of disputes, as such. And that is so whether or not the settlement is embodied in an award. Parliament may validly legislate with respect to the settlement of disputes, including a settlement embodied in an award, only if the law is, relevantly, a law with respect to conciliation and arbitration.
In essence, the argument that there is a relevant connection between the original settlement of the dispute by the Award and the Award as varied by operation of item 50 in Pt 2 of Sched 5 to the WROLA Act is an argument that Parliament may legislate with respect to an award or with respect to the effect to be given to an award. And that proposition invites analysis of the constitutional underpinning of ss 148(1) and 149(1) of the principal Act which give continuing and binding effect to awards.
It is well settled that an industrial dispute is not a dispute as to existing rights and liabilities but a dispute as to what rights and liabilities should exist as between employers and employees[34]. Where the processes of conciliation and arbitration are brought to bear on an industrial dispute, they are brought to bear, in the case of conciliation, for the purpose of reaching agreement or, in the case of arbitration, for determining what those rights and liabilities should be. It may be that, in some cases, the law of contract operates to create binding rights and obligations in the event of a conciliated agreement. That aside, however, the outcome of conciliation and/or arbitration takes effect, not by its own force, but by force of those legislative provisions which give effect to it[35].
Since legislation was first enacted pursuant to s 51(xxxv) of the Constitution, the outcome of the arbitral process has been known as "an award"[36]. And for very many years the outcome of the conciliation process has either been given effect as an award or has been incorporated in an award embodying the outcome of arbitration. That position may have changed somewhat since the enactment of s 143(1A) of the principal Act[37]. Whether or not that is so, a law giving binding effect to the outcome of conciliation and arbitration with respect to an interstate industrial dispute is, clearly, a law with respect to the processes the subject of s 51(xxxv), namely, conciliation and arbitration. A law of that kind is at the heart of the conciliation and arbitration power and raises no question as to the scope of the so-called "implied incidental power".
A law gives effect to the outcome of conciliation or arbitration if the agreement which embodies the outcome of conciliation or the award which embodies the outcome of arbitration "applies to the various parties and persons according to its terms and provisions"[38]. On one view, the question whether Parliament may legislate to give effect to an award (using that word to mean the outcome of the processes of conciliation and arbitration) other than in precise accordance with its terms, was considered in Waterside Workers' Federation of Australia v Commonwealth Steamship Owners' Association ("the Waterside Workers' Case")[39].
The Waterside Workers' Case concerned the validity of a legislative provision to the same effect as s 148(1) of the principal Act which, subject to any order of the Commission to the contrary, continues an award in effect beyond its term and until a new award is made. The provision in question in the Waterside Workers' Case was held valid in its application to an existing award which, in terms, provided for its earlier expiry.
In the Waterside Workers' Case, Isaacs and Rich JJ, in dissent, noted that the Parliament cannot, itself, legislate to "impose any obligations or alter rights by any provision which dispenses with arbitration" and continued:

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So far as concerns future awards and, also, awards which are not expressed to operate for a precise period, there is no difference between a law that makes the outcome of conciliation and/or arbitration binding on the parties and a law that makes that outcome binding for a specified period of time. A law that makes an award binding for a specified period is, simply, a law giving effect to and indicating the period for which effect is given to the outcome of conciliation or arbitration. Subject to a qualification shortly to be mentioned, a law making an award binding for a specified period is a law with respect to conciliation and arbitration and lies at the centre not the circumference of the power conferred by s 51(xxxv) of the Constitution.
The qualification to what has been written above is this: although a law providing that an award shall have effect for a specified time is a law with respect to conciliation and arbitration, it is not, in my view, a law with respect to conciliation and arbitration for the prevention and settlement of industrial disputes unless it allows that the processes of conciliation and arbitration may be brought to bear to set aside or to vary the award, including as to its period of operation, or to make a new award in settlement of a further dispute.
A law that continued an award in effect but did not permit of the courses outlined above would thwart the very purpose which, by s 51(xxxv), conciliation and arbitration is to serve, namely, the prevention and settlement of interstate industrial disputes. Thus, although a law which continued an award in effect but did not permit of the possibilities indicated would properly be characterised as a law with respect to conciliation and arbitration, it would not be a law with respect to conciliation and arbitration for the prevention or settlement of industrial disputes.
A somewhat different analysis is directed in the case of a law which extends the operation of an existing award beyond its expressed term, that being the situation considered in the Waterside Workers' Case[43]. A law that extends the duration of an existing award until set aside or varied, or until a new award is made in exercise of the powers of conciliation and/or arbitration, is, in my view, clearly a law that is appropriate and adapted to the main purpose of s 51(xxxv), namely conciliation and arbitration for the prevention and settlement of interstate industrial disputes. And that is so even if the award is expressed to operate for a precise period. That is because a law of that kind preserves the outcome of the processes of conciliation and arbitration until those processes can again be brought to bear for the purpose of preventing or settling interstate industrial disputes.
It follows that in their unmodified form, ss 148(1) and 149(1) of the principal Act which, respectively, give effect to awards and extend the operation of awards, are valid. They are valid because they give effect to or continue the effect of the outcome of conciliation and arbitration until set aside or a new award is made. However, if Parliament legislates to give effect to some only of the terms of an award, or, more precisely, to deny effect to some terms whilst continuing the effect of others, it is not legislating with respect to the outcome of the processes of conciliation and arbitration. It is creating a new outcome from the combined processes of legislation and arbitration or, perhaps, the combined processes of conciliation, arbitration and legislation. In substance, the position is the same as if Parliament were to legislate directly to supplement the terms of an award. It follows that s 3 of the WROLA Act, to the extent in issue in these proceedings, cannot be supported on the same constitutional basis as ss 148(1) and 149(1) of the principal Act.
As will later appear, Parliament could have amended s 148(1) of the principal Act to withdraw all legislative support from awards containing nonallowable award matters. And it could also have legislated to require the Commission to review awards containing non-allowable award matters to determine whether it was desirable that they should continue to make provision with respect to those matters and directing it, if it found their continued operation undesirable, to vary the awards by deleting those provisions[44]. Of course, the award as varied would be a valid exercise of the conciliation and arbitration power only if it retained a requisite connection with the dispute in respect of which it was made. But Parliament has taken neither course.
In substance, Parliament has attempted, itself, to review the awards of the Commission and to vary them in the exercise of legislative power. It has substituted its decision for that of the arbitrator. A law which substitutes an outcome that is different from the outcome of the processes of conciliation and arbitration is not a law with respect to conciliation and arbitration. Accordingly, the argument that s 3 of the WROLA Act, to the extent in issue in these proceedings, is valid because there is a relevant connection between the original award and the award as varied by item 50 in Pt 2 of Sched 5 to that Act must also be rejected.

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McHUGH J. The question in these two matters is whether s 3 of the Workplace Relations and Other Legislation Amendment Act 1996 (Cth) ("the WROLA Act") is invalid to the extent that it gives effect to item 50 and subitems 51(1), 51(2) and 51(3) of Sched 5 to the WROLA Act. The prosecutors'/plaintiffs' claim that it is invalid because the enactment of that item and those subitems is not supported by s 51(xxxv) of the Constitution or any other head of power in s 51 of the Constitution.
The first matter before the Court which gives rise to this question, S137 of 1998, is an application in the original jurisdiction of the Court for writs of prohibition, certiorari and mandamus directed to Justice Boulton of the Australian Industrial Relations Commission ("the Commission") and others. The application is brought by the Construction, Forestry, Mining and Energy Union ("the CFMEU") and Mr Barnes, a CFMEU member who was employed by Pacific Coal Pty Limited ("Pacific Coal") as a coal mine production worker at its Blair Athol mine in Queensland from 1983 until 17 August 1998. On 19 May 1999, by the consent of the parties, Kirby J made orders nisi for the relief sought, and those orders nisi are now returned before the Full Court.
The prosecutors seek an order that the orders nisi be made absolute on the ground that the variation of the Coal Mining Industry (Production and Engineering) Consolidated Award 1997 ("the award") ordered by Boulton J on 1 July 1998 and other related decisions and orders made by Boulton J were made without jurisdiction. They contend that his Honour had no jurisdiction because the provisions of Sched 5 pursuant to which Boulton J acted (item 50 and subitems 51(1), 51(2) and 51(3)) are invalid. The application seeks relief against members of the Full Bench of the Commission who have heard but not yet determined an appeal from the decision of Boulton J to vary the award. They also seek relief against Pacific Coal and thirty-eight other respondents (who are all employers in the coal industry) to prevent any of them from giving effect to or relying upon the decisions and orders of Boulton J made in connection with the variation of the award.
Justice Boulton varied the award made by deleting, inter alia, the following clauses:

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The respondents contend that under the amendments introduced by the WROLA Act the terms and conditions of the settlement are unaltered. That being so, they argue that Parliament has not directly legislated for the terms and conditions of employment by enacting items 50 and 51 because all subitem 50(1) is doing is withdrawing the enforceability of certain provisions of the award and item 51 is merely a consequential provision.
The prosecutors, on the other hand, argue that "ceases to have effect" in subitem 50(1) means "ceases to have any legal effect whatsoever". On that construction, to the extent that the award affects any legal rights or obligations other than by force of the Act, those rights and obligations are also deprived of that effect. The prosecutors argue that, if the provisions of an award which were not allowable award matters have been incorporated into a contract of employment, subitem 50(1) would deprive them of their contractual effect as well as their effect under the Act.
In my opinion, the contention of neither side of the record correctly describes the effect of items 50 and 51. The two items must be read together. Although subitem 50(1) does not by its terms provide that the award ceases to have effect "for the purposes of the Act" to the extent specified - it simply provides that the award "ceases to have effect" to the extent specified - the respondents' argument would be plausible if subitem 50(1) stood alone. That is particularly so in light of the fact that a construction which leads to validity is to be preferred to one which leads to invalidity[59]. However, subitem 51(2) states that the "Commission must vary the award to remove provisions that ceased to have effect under item 50". That direction makes it clear that the effect of items 50 and 51 is to deprive certain provisions of an award of their legal status as provisions of an award for all purposes. If subitem 50(1) were simply intended to deprive certain provisions of an award of their effectiveness for the purposes of the Act, subitem 51(2) would not be required because the provisions would be part of the award for other purposes. That is, to the extent that enforceable rights and obligations derive from a provision's legal status as a provision of an award, those rights and obligations are rendered ineffective by subitems 50(1) and 51(2).
Sections 149, 178 and 179 of the Act operate upon an award's status as an award, and the deprivation of certain provisions of the award of their legal status means that those provisions cannot be enforced pursuant to ss 149, 178 or 179. But this is not the only effect of subitem 50(1). If another Commonwealth Act (or a State Act which was not inconsistent with Commonwealth legislation for the purposes of s 109 of the Constitution) attached legal consequences to an award provision's legal status as an award provision, those consequences would disappear as the underlying effectiveness of the award provision qua award provision would have been removed by subitem 50(1).
However, the construction that I have adopted does not mean that unallowable award provisions which are "incorporated" into contracts of employment automatically cease to have contractual effect. In Byrne v Australian Airlines Ltd[60], this Court decided that an award provision does not ipso facto become imported into the contract of employment which it regulates. Whether it becomes a term of the contract depends on the intention of the parties. Byrne decided that whether an award provision is a term of the contract of employment is to be determined by reference to the usual principles for ascertaining the terms of a contract. At a given point of time, the text of the award (as opposed to its legal effectiveness) may have contained the text of terms which were subsequently adopted by the express or implied agreement of the parties. If so, the agreement will not usually be affected by the repeal of the award. Accordingly, the deprivation of the legal status of an award provision qua award provision would ordinarily be irrelevant to the effectiveness of a contractual term which corresponded with that award provision. However, in some cases the removal of the award provision may deprive the corresponding contractual term of effect. But that would be the case only where the contractual term is dependent on the continued existence of the award term.

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Similarly, in R v Kirby; Ex parte Boilermakers' Society of Australia[71], this Court held that the concept of "arbitration" does not require that the parties to the arbitration agree as to the identity of the arbitrator - the arbitrator may be a "tribunal to which the parties to industrial disputes of the specified character are compelled to submit their differences".
However, it would be pointless to compel parties to submit to an arbitrator if the arbitrator's subsequent decision could be completely ignored by the parties without legal sanction. In the case of parties voluntarily submitting to arbitration, the parties themselves agree to be "bound by the decision". But at least in the case of compulsory arbitration, legislative provisions are needed to make the outcome of the arbitration binding on the parties.
The passage in the judgment of Isaacs and Rich JJ in Waterside Workers' Federation of Australia v J W Alexander Ltd[72], to which I earlier referred, suggests that Isaacs and Rich JJ did not conceive of an arbitrated award as one which would not be given legal effect by the Parliament. If a statute set up a sophisticated process of non-voluntary arbitration but contained a provision that the arbitrator's award would have no legal effect, it is not easy to accept that it would be an arbitration for the purpose of s 51(xxxv) of the Constitution. Depending on all the circumstances, it might be upheld as a law with respect to conciliation but it is hard to accept that the law provided for arbitration for the settlement of an industrial dispute. If the parties can ignore the "arbitrated" result, the process does not bind them and the arbitration has not settled the dispute. At best, it suspends the continuance of the dispute for as long as the parties agree to act in accordance with the "arbitrated" award.
The prosecutors conceded that it would be open to the Parliament to legislate so as to make a previously enforceable award completely unenforceable by repealing the provisions which allowed the award to be enforced. In my opinion, that concession was properly made, for reasons which are discussed below. However, there is a constitutional difference between such a repeal and a statute which provides no means of enforcing an arbitrator's award at any time after it is made. That is because in the case of a statute repealing the enforceability of an award, at the time the process of arbitration was engaged, it was an arbitration and was an arbitration directed at the settlement of an industrial dispute. The fact that the enforceability of the award has been subsequently withdrawn does not affect the process or the purpose to which the process was directed at the time that it was engaged. Where the "arbitrated" award is never to have binding effect, however, there is no process which can result in a binding decision determining substantive legal rights and obligations in settlement of an industrial dispute.
Because the compound conception of "arbitration for the ... settlement of disputes" in s 51(xxxv) involves some notion of the enforceability of the outcome, I cannot accept the argument of the respondents that the legislation is valid because the impugned provisions do not affect the settlement of the dispute but only its enforceability. That argument seeks to divorce the notion of an arbitrated settlement from its enforceability. The extent to which notions of enforceability of the outcome are tied up in the compound conception of arbitration directed to the settlement of an industrial dispute in s 51(xxxv) needs to be more closely examined.

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The decided cases in this Court on the conciliation and arbitration power show that, if legislation affecting the enforceability of an award retains the integrity of the award as an outcome of conciliation or arbitration, that legislation will generally be a law with respect to s 51(xxxv). That this result flows from the authorities is not surprising. It is a result dictated by a principled application of the text of the Constitution. The compound conception in s 51(xxxv) includes a process and an objective. Assuming that the process meets its constitutional description, then a law with respect to the outcome simpliciter of that process will generally be a law with respect to the compound conception because the outcome is the embodiment of the constitutionally dictated objective.
However, a law which operates upon the outcome in such a way so as to not deal with it as an outcome simpliciter will not necessarily be a law with respect to the compound conception. If the law deals with only part of the outcome, the outcome will not necessarily retain its status as the end of the constitutionally dictated objective of the process. Part only of the outcome may be something which is not referable to the process directed to that objective.
In Australian Boot Trade Employés' Federation v Whybrow & Co[73], this Court held that ss 38(f) and 38(g) of the Commonwealth Conciliation and Arbitration Act 1904 (Cth) were invalid. Section 38(f) purported to authorise the Court of Conciliation and Arbitration to "declare by any award or order that any practice, regulation, rule, custom, term of agreement, condition of employment or dealing whatsoever determined by an award in relation to any industrial matter shall be a common rule of any industry in connection with which the dispute (ie the dispute which gives rise to the award) arises"[74]. Section 38(g) purported to provide that the Court of Conciliation and Arbitration had power to direct that the common rule so declared shall be binding upon the persons engaged in that industry[75].
The Court held that both ss 38(f) and 38(g) were invalid because there were no ascertainable parties in an ascertainable dispute which were requirements for an "arbitration" within the meaning of s 51(xxxv). The Court held that ss 38(f) and 38(g) fell together. It drew no distinction between the "award or order" made by the Court of Conciliation and Arbitration under s 38(f) and the binding effect given to that "award or order" by s 38(g). That was because the Parliament's power to legislate to give an "award or order" binding effect under s 51(xxxv) was dependent upon the "award or order" being the outcome of the constitutional process of arbitration. The Court's finding that the "award or order" made under s 38(f) was not the outcome of "arbitration" - because there was no identifiable dispute - necessarily resulted in s 38(g) (which dealt with enforceability) also being invalid.
In Waterside Workers[76], a majority of this Court held that s 28(2) of the Commonwealth Conciliation and Arbitration Act 1904 (Cth) was a valid enactment under s 51(xxxv). That section provided that, in the absence of an order by the Arbitration Court to the contrary, an award shall continue in force from the date of the expiration of the period specified therein until a new award is made. Knox CJ held that the section was valid. His Honour said[77]:

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In my opinion, the difference between the majority and the minority in Waterside Workers can be explained as follows. The majority held that s 28(2) merely operated upon the award, and preserved its status as the arbitrated settlement of a dispute. As Higgins J expressed it: "[h]ere Parliament does not even say that a certain minimum rate shall 'continue in force,' but what it says is that a certain award shall continue in force"[84]. The minority on the other hand held that the duration of the award was one of its essential terms and that to legislate for the duration of the award was to "alter [the arbitrator's] decision"[85] and to deprive it of its status as an arbitrated outcome.
No member of the Court in Waterside Workers approached s 28(2) on the basis that there is a dichotomy between the terms of an award and its enforceability. Section 28(2) did not by its terms purport to alter the terms of the award. It merely dealt with its enforceability in a given period. It is clear from the judgments in Waterside Workers that it was the legal rights to which s 28(2) gave rise, rather than the award (which remained unchanged) which were examined to determine whether Parliament had directly legislated for the terms and conditions of employment.
Similarly, in George Hudson Ltd v Australian Timber Workers' Union[86], the issue was whether it was within the power of the Parliament to enact that an agreement made between parties to an industrial dispute should be binding not only on those parties, but also on the successor in business or the assignee of the business of any party to the agreement. The provision in question thus only purported to effect the enforceability of the award, not its content. The Court held that the provision was valid.
Knox CJ (with whom Gavan Duffy J agreed) dissented. Knox CJ thought that the decision in Australian Boot Trade Employés' Federation v Whybrow & Co[87] dictated the conclusion that the legislation was invalid. As noted earlier, in Whybrow, the Court held that it was beyond the power of the Parliament to enact that persons who were not parties to an industrial dispute could, by means of an order of the Court of Arbitration, be bound by an award of the Court duly made for the purpose of preventing or settling that dispute. Knox CJ saw no relevant difference between the legislation in Whybrow and that before him.
However, Isaacs J said[88]:

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In relation to provisions requiring the Commission to review and/or vary awards previously made by it, the crucial fact is that it is the Commission which has the ultimate power of variation. The Commission, being the body which made the original award, may be taken to be cognisant of all the various matters which led to the award being promulgated in its original form, and will be in a position to ascertain whether the award as varied maintains a connection with the original industrial dispute. This fact, when coupled with the doctrine that provisions allowing or requiring variation by the Commission have "always been construed, or more accurately, read down by reference to the limits of the power conferred by s 51(xxxv) of the Constitution so as to authorise only those variations which have a relevant connection with the dispute giving rise to the award in question"[95], will generally preserve the validity of legislation requiring or allowing the Commission to vary an award.
In cases where the Commission has a discretion as to the variations to be made, the Commission cannot make the variation if the award as varied does not retain its connection with the original industrial dispute. In cases where the Commission is directed to make a particular variation, the legislation will be invalid to the extent that the award as varied would no longer retain a connection with the original industrial dispute.
In this case, the impugned provisions do not operate upon the outcome of the process simpliciter. They do not, for example, provide that the entire award has legal effect or that the entire award has no legal effect. Given that they only operate selectively upon part of the award, the question which arises is whether they operate so as to deprive the award of its status as the achievement of the constitutionally dictated objective of the process.
In my opinion, items 50 and 51 do operate to deprive the award of its status as the achievement of the constitutionally dictated objective of the process. They are not laws with respect to the outcome of the constitutional process directed at settling the original dispute. The process of reaching an arbitrated settlement necessarily involves trade-offs being made between the competing claims of the parties. The arbitrator may consider that it is just to impose an obligation on a party ("obligation A") in return for granting that party a compensating right ("right B"). In constructing the award, the arbitrator would have been working on the assumption that the term of the award giving effect to right B would have the same legal status and enforceability as the term of the award giving effect to obligation A, and that no single term of the arbitrated outcome would in the future achieve a preferred legal status over any other term. If it were otherwise, the arbitrator could not confidently impose obligation A as the quid pro quo for the granting of right B. The arbitrator would be forced to guess which terms might be unenforceable in the future. In striking of the appropriate balance, the arbitrator would be forced to apply some "discounting factor" to those terms because in the future they may be of no utility to a party - no more substantial in reality than "buildings on a movie set - structures with the appearance of reality but having no substance behind them"[96].
By selectively denying the enforceability of some of the provisions of the award, items 50 and 51 have contradicted an inherent element of the constitutional process directed to settling the original dispute. They are therefore not laws with respect to the process directed to the objective of "settlement" of the original "dispute". They render ineffective the non-distributive enforceability of the terms of the award which were a fundamental driver of the "settlement" of that dispute.
Moreover, items 50 and 51 differ in a fundamental respect from the provisions considered in R v Kelly; Ex parte Australian Railways Union[97] and the Industrial Relations Act Case[98]. By selectively depriving provisions of an award of their status as provisions of an award, and hence of their enforceability, items 50 and 51 transcend the "scope and nature of the original dispute"[99].
For these reasons, items 50 and 51 are invalid. However, it is necessary to address two further arguments made by the respondents to demonstrate why those arguments cannot succeed.

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In each of the matters S137 of 1998 and S138 of 1998, I would make orders as proposed by Kirby J.
GUMMOW AND HAYNE JJ. The way in which the Commonwealth Parliament has exercised its power under s 51(xxxv) of the Constitution (to make laws with respect to conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one State) has directed the development of industrial law in Australia since 1904[118]. It has meant that the fixing of terms and conditions of employment by arbitrated or conciliated awards of officers of the Commonwealth[119], or State officials having very similar functions, has taken a pre‑eminent place in the regulation of industrial relations in Australia. Those awards have then been enforced by the methods given by the Commonwealth conciliation and arbitration legislation or analogous State provisions.
The importance of arbitrated or conciliated awards in Australia has been at the expense of some features of other systems of industrial relations. Collective bargaining has a different place in Australia, and takes a very different form, from the bargaining that has taken place in the United States, the United Kingdom, or Germany[120]. The enforcement of arrangements struck between organisations of employees and employers or groups of employers has not depended solely on industrial action as it sometimes has in the United Kingdom[121]. Nor has there been the resort to enforcement in the ordinary courts of collectively negotiated contracts that has been seen in the United States[122]. More importantly, there has seldom been the need to focus, at least until recently, upon the terms and conditions of an individual's contract of employment. Identifying the relevant award and its terms has been much more important[123].
These features of the history of industrial relations in Australia must not be permitted to obscure two important matters relevant to the present proceedings. First, while the Commonwealth Parliament has power to make laws with respect to conciliation and arbitration, the fact that it has exercised that power in ways that have had profound effects on the ordering of relations between employers and employees does not mean that the Parliament cannot choose to dismantle the structure it has erected. The power to make a law includes a power of repeal. If that were not so, then as Brennan CJ and McHugh J put it in Kartinyeri v The Commonwealth[124], "a law once enacted would be entrenched and beyond the power of the Parliament to revoke". Secondly, the focus upon awards and their enforcement does not mean that the individual contract of employment between employer and employee cannot be the primary source of the conditions of employment of a particular employee. An objective of the legislation under consideration here is that wages and conditions of employment be determined as far as possible by the agreement of employers and employees.
The changes the Parliament has made by the legislation which gives rise to this litigation involve both the revision of the existing structure and the making of transitional provisions for the passage from the old to the new legal order. The ultimate issue in these matters is the constitutional validity of s 3 of the Workplace Relations and Other Legislation Amendment Act 1996 (Cth) ("the WROLA Act") in so far as it gives effect to items 50 and 51(1), (2), and (3) of Pt 2 of Sched 5 to the WROLA Act. Items 50 and 51 are two of the provisions made for the transition from the Commonwealth industrial relations regime prescribed by the Industrial Relations Act 1988 (Cth) to the new arrangements introduced by the WROLA Act. Under those new arrangements, awards made by the Australian Industrial Relations Commission ("the Commission") deal with a smaller range of subjects than had previously been the case and, in general, provide only for minimum conditions of employment.
The issue of validity is raised in two proceedings - one the return of an order nisi for writs of certiorari, prohibition and mandamus against members of the Commission, and the other, an action in the original jurisdiction of the Court in which a question has been reserved for the opinion of the Full Court. The first of those proceedings is brought by the Construction, Forestry, Mining and Energy Union and one of its members who was, until 17 August 1998, employed at a coal mine operated by the second respondent in the proceeding, Pacific Coal Pty Ltd. The second proceeding is brought by the Union and the same member of the Union against the Commonwealth. Before saying anything further about the facts which give rise to the proceedings, it is convenient to deal first with the relevant legislation.
The WROLA Act made many amendments to the Industrial Relations Act. (Those amendments included changing the short title of the Act to the Workplace Relations Act 1996[125] and it is convenient to refer to the Act in its amended form as the "Workplace Relations Act".) Section 3 of the WROLA Act provides that:

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Schedule 5 to the WROLA Act is headed "Awards" and is divided into two parts. Part 1 (items 1‑45) is headed "Amendments". Items 8‑41 amend provisions of Pt VI of the "Workplace Relations Act 1996" (which in the context means the Industrial Relations Act as then in force). Part VI is headed "Dispute Prevention and Settlement" and comprises ss 88A‑167[126]. These include many provisions central to the legislative scheme first established by the Commonwealth Conciliation and Arbitration Act 1904 (Cth). For example, s 143 requires the Commission, when it makes a decision or determination that, in its opinion, is an award or order affecting an award, promptly to reduce the decision or determination to writing that expresses it to be an award. An award shall specify the period for which it is to continue in force (s 147(1)) and is binding on all parties to the industrial dispute who appeared or were represented before the Commission and upon the other parties identified in s 149. An award prevails over State awards to the extent of any inconsistency between them (s 152).
For present purposes the most relevant changes made by Pt 1 of Sched 5 to the WROLA Act are those which provide for what are called "allowable award matters". These matters are the 20 subjects set out in s 89A(2) of the Workplace Relations Act and include hours of work[127], pay and allowances[128], superannuation[129], and leave entitlements[130]. Subject to some limitations or exceptions which need not now be noticed, s 89A(1) provides that for the purposes of dealing with an industrial dispute by arbitration, of preventing or settling an industrial dispute by making an award or order, or of maintaining the settlement of an industrial dispute by varying an award or order, an "industrial dispute" is taken to include only allowable award matters. The section further provides that the power of the Commission to make an award dealing with those matters is limited to making "a minimum rates award". There is no attack on the validity of any of the provisions of Pt 1 of Sched 5.
The provisions attacked are in Pt 2 of Sched 5. Part 2 (items 46-55), entitled "Transitional provisions", is intended to deal with the way in which the changes made by the WROLA Act would be introduced during the "interim period". That period is defined as "the period of 18 months beginning on the day on which section 89A of the Principal Act commences". The interim period began, therefore, on 1 January 1997[131] and ended on 30 June 1998.
On its face, Pt 2 is designed to produce the result that, upon the conclusion of the interim period, existing awards may include only allowable award matters. Existing awards thereby become subject to the same limitations as new awards made after the changes made to the Workplace Relations Act by Pt 1 of Sched 5. The essence of the attack upon the validity of the provisions of Pt 2 is that they lack sufficient connection with the head of power relied upon, that in s 51(xxxv).
Although the provisions of Pt 1 of Sched 5 are not challenged, it is as well to say something about the provisions of Pt VI of the Industrial Relations Act as amended by items 8‑41 of Pt 1 of Sched 5. Those provisions, which relate to "Dispute Prevention and Settlement", must be understood in the light of the objects of Pt VI. They are stated[132] to be:

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It is clear, then, that the changes introduced by the WROLA Act were intended not only to reduce the subjects with which awards could deal and to limit the power to make awards about those subjects to minimum rates awards, but also to ensure that "primary responsibility for determining matters affecting the relationship between employers and employees rests with the employer and employees at the workplace or enterprise level". Thus, the evident intention of the amendments was that awards of the Commission would no longer be the principal repository (let alone the exclusive repository) of the terms and conditions of employment of individual employees.
This intention was carried into further effect by changes made by item 41 to s 152 of the Workplace Relations Act, the provision dealing with the interrelation between Commonwealth and State industrial law. If the wages and conditions of employment of an employee are governed by a State employment agreement then a subsequent award under federal law will not become binding on any person in respect of that employee whilst regulation under the State agreement continues (s 152(2)). If such an agreement is made after a federal award binds an employer in respect of an employee, the award will not prevent the agreement from coming into force and, whilst the agreement continues to regulate the wages and conditions of an employee, the award will not be binding on any person in respect of the employee (s 152)(3)).
Item 52 of Pt 2 of Sched 5 applies where there has been variation of an award under item 49(1) or the award wholly or partly ceases to have effect by operation of item 50. The result of this contraction in the operation of the federal regime may be to render an employer bound by a State award in respect of an employee. In such circumstances the effect of item 52(1) is that if the employer is a "constitutional corporation"[133], it will only be bound if the employer makes an application to the relevant State industrial authority.
Part 2 of Sched 5 comprises items 46 to 55. Item 47 of Sched 5 provides that:

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Items 50 and 51 must be understood in their context. The parties to the award had had 18 months within which to approach the Commission (pursuant to item 49) to vary the award by removing provisions dealing with matters which were not allowable award matters (and making any necessary consequential changes). If they did not do so, item 50 would produce that result at the end of the interim period. A party to an award who contended that such a variation would, or might, lead to inappropriate consequences in respect of what remained of the award could have sought, during the interim period, a variation of the award as to those matters under s 113 or, as we have said earlier, could have sought to promote a fresh industrial dispute about those allowable award matters.
Something more should be said, at this stage, about the facts which give rise to the present proceedings. Both arise out of the Coal Mining Industry (Production and Engineering) Consolidated Award 1997 ("the Coal Award"), an award of the Commission which contained matters other than allowable award matters. In particular, the Coal Award provided for (among other things) preference to union members in the engagement of labour covered by the award, preference of employment to those retrenched by one employer who was a respondent to the award in seeking employment at the Queensland sites of any of the other respondents, and rights of seniority of employment such that selection of those to be dismissed as part of a reduction of hands would be on the basis of "the last to come the first to go". In addition, the Coal Award provided for authorised union representatives to enter the premises of a respondent to the award. It was accepted that none of these provisions was an allowable award matter and that, therefore, item 50 applied to all of them.
It can be seen that item 50 applied to some provisions which operated directly and immediately upon individual employees. (The second prosecutor in the proceedings seeking certiorari, prohibition and mandamus was retrenched in August 1998 by an employer who was a party to the Coal Award. Had the principle of last to come, first to go been applied, he would not have been made redundant. In addition, if the provisions giving preference of employment to retrenched employees of a respondent to the award had applied, he may have obtained other work.) Other provisions to which item 50 applied (such as the right of entry of authorised union representatives) had a less direct and immediate effect upon the terms of employment of individual employees.
It is necessary to begin any consideration of validity by construing s 3 and items 50 and 51. As Kitto J said in Fairfax v Federal Commissioner of Taxation[138], the question of constitutional validity under s 51 of the Constitution

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Nor is this a case where the subject of the law can at best only be incidental to the exercise of the head of power. Where the subject is incidental in this way, the "end or purpose" of the law will "give the key" to the adequacy of the connection with that head of power[148]. Item 50, the primary provision whose validity is attacked, deals only with the effect the pre-existing legislation, itself founded upon s 51(xxxv), gave an award, and item 50 itself is a law at the centre, not the circumference, of the power. Notions of "end or purpose" are inapplicable. Nor is it suggested that this is a case where legislation is invalid because it infringes a limitation upon legislative power which is expressed or implied in the Constitution. In Nationwide News[149], s 299(1)(d)(ii) of the Industrial Relations Act 1988 (Cth)[150] was held on such a ground to be invalid. In that realm of discourse, questions of proportionality and reasonable adaptation may arise, as is illustrated by several of the judgments in Nationwide News[151].
Unlike Pt 1, Pt 2 of Sched 5 is not drafted in the form of amending or repealing provisions. Each provision in Pt 1 begins with the word "repeal", "insert", "omit", or "add" and then specifies the provision or expression in respect of which that step is to be taken. By contrast, Pt 2 of Sched 5 is drafted in the same way as substantive provisions of an Act would ordinarily be drawn and is not drafted so as to suggest an intention to change the manner of operation of other particular provisions. On its face then, what might be called the first half of s 3[152] operates to give effect to the items in Pt 1 of Sched 5 and it is the second half of s 3[153] which gives effect to the items in Pt 2 of Sched 5.
What, then, does item 50 mean when it says that at the end of the interim period "each award ceases to have effect to the extent that it provides for matters other than allowable award matters"? In particular, what does "ceases to have effect" mean in this context?
Two competing constructions of item 50 emerged from the debate in the oral argument of the proceedings. One was that item 50 meant that, at the end of the interim period, provisions of awards which provided for matters other than allowable award matters ceased to have any legal effect whatsoever, whether pursuant to the Workplace Relations Act or contracts of employment between individual employers and employees. The competing construction was that item 50 meant only that whatever effect was given by the Workplace Relations Act to those provisions of awards that were not allowable award matters ceased at the end of the interim period. This debate lay behind the competing characterisations of item 50. Those who alleged invalidity sought to characterise it (or, more accurately, s 3 in so far as it gave effect to the item) as a law with respect to the particular terms and conditions of employment of individual employees, rather than a law with respect to conciliation and arbitration for the prevention and settlement of industrial disputes. Those who denied invalidity sought to attribute the latter characterisation to the provisions on the basis that s 3 and item 50 were no more than a repeal or amendment of laws that had previously been passed on that subject.
Having regard to the various provisions of the WROLA Act and the Workplace Relations Act that we have mentioned, we do not consider that item 50 should be read as intending to do more than remove any support (that is, any "effect") which the Workplace Relations Act may otherwise have given to those provisions of awards which were not allowable award matters. To understand why that is so, it is necessary to consider what is meant by giving "effect" to an award. First (and obviously) the effect in question is legal effect. That is, when it is said that effect is given to an award, it means that the provisions of the award are of legal significance; legally enforceable rights, duties, powers and privileges are created.
Secondly, it is necessary to recall that an award is the arbitrated or conciliated outcome of a process that takes place, usually, between employers, or groups of employers, and one or more registered organisations representing the interests of employees. As is apparent from what we have said about the Coal Award, an award will often contain provisions that would find no place in an individual contract of employment. That may be because one employer cannot bind another (for example, to give preference to retrenched employees) or because the terms are intended to give rights or privileges to organisations rather than individuals. The award is therefore cast in terms of generality rather than in terms of the stipulations which together make up a particular contract of employment between an employer and an employee.
Thus, when "effect" is given to an award, it is given legal consequences which attach to individuals, groups or organisations because of the particular status which the award is given by the legislation pursuant to which it was made. When that legislation gives rights to, or imposes obligations on, individuals that are rights or obligations referable to the award, they are rights and obligations conferred by the legislation.
That is not to say that the making of an award may not have other important consequences. It is commonplace for persons to be employed pursuant to a contract of employment whose terms incorporate by reference part or all of the identified award, either as it stands at a particular time, or more usually, as it is varied from time to time. Employment on those terms will mean that the content of the obligations and rights of the employer and employee are found in the award (or the award as varied). But again, not all of the terms of an award may be apt to constitute contractual stipulations binding the employer or the employee. For present purposes, what is important is that to the extent that the obligations and rights described in an award are expressly incorporated in a contract of employment, their binding effect as contractual stipulations derives from their incorporation in the contract, not from the award or the legislation which supports the award.
To read item 50 as intended to deny any and all legal effect to the award provisions with which it dealt, no matter whether that effect was legislative or contractual, would attribute to it an intention to regulate the terms and conditions of employment of individual employees which would be entirely antithetical to the stated object of the Workplace Relations Act as being to ensure that primary responsibility for such matters "rests … at the workplace or enterprise level"[154]. In addition, if reading it in that way would lead to invalidity, that would be a further, perhaps even conclusive, reason not to do so if there were some other available construction consistent with validity[155]. But we need not, and do not, base our construction of s 3 and item 50 on those last‑mentioned considerations. Rather, we consider that the "effect" with which item 50 was concerned was the legal effect given to awards by the Commonwealth conciliation and arbitration legislation, and not any wider legal effect that would be attributable to the incorporation of particular awards or provisions of awards in individual contracts of employment. Nor is item 50 concerned with the question whether any legal effect may be given, as a contract, to the bargain struck between the parties who negotiated the outcome of the industrial dispute which lies behind the award. It is only the effect given to awards by the legislation which can properly be described as the effect of an award. The legal consequences of incorporation in contracts of employment and any legal consequences that may attach to a collective bargain are consequences of the contract or bargain, not the award.
It follows from the construction of item 50 which we favour, that the answer to the question whether those parts of awards which are not allowable award provisions would have any continued legal effect as terms or conditions of employment after the end of the interim period, would depend upon whether they were terms of the contract of employment of an employee. Further, whether the provisions would, in some way, be enforceable (outside the provisions of the Workplace Relations Act) by the parties to any agreement that gave rise to the making of the award, would depend on other questions. Those questions would include, most importantly, whether the agreement (which would often have one or more industrial organisations as a party) was one intended to create, and was capable of creating, legal relations other than those provided for by the Workplace Relations Act[156].
What, historically, has been the pervasive and dominating influence of the award system leads to no different conclusion. No doubt the breadth and significance of that influence underpinned the submissions, put unsuccessfully in Byrne v Australian Airlines Ltd[157], that award provisions were imported into individual contracts of employment independently of the intention of the parties, or as a matter of custom or usage, or as implied terms. But those submissions were rejected in Byrne and the Court held that the obligation to observe the provisions of the award which were in issue in that matter, arose only by force of statute; the award was not incorporated into the contracts of employment. A construction of item 50 which would give it an operation defeating contractually agreed terms would attribute an "effect" to awards which the Court held in Byrne that they do not have.
Once it is recognised that item 50 deals only with the effect which the legislation has given to an award, it becomes evident that it is not necessary or helpful to the task of constitutional characterisation to consider some of the questions that were raised in argument. In particular, it is not necessary or helpful to consider whether terminating the legislative effect given to awards in respect of some, but not all, of the terms of a consent award will upset the balance at which the parties to a dispute arrived when they struck the bargain reflected in the award. That is, it is not necessary or helpful to consider examples in which statutory effect continues to be given to some of the terms of that bargain (more or less onerous to one side of the bargain) but not other terms which might be said to have been the price exacted for undertaking the burden.
Such questions may have significance for other purposes but they do not assist the task of constitutional characterisation. That task requires consideration of "the nature of the rights, duties, powers and privileges which [the legislation] changes, regulates or abolishes"[158]. Here the rights, duties, powers and privileges which are changed, regulated or abolished are some of those which were given by the Parliament in respect of the outcome of the process of conciliation and arbitration carried on under legislation enacted pursuant to s 51(xxxv). The effect of the changes may be very large, and may even be classified by some as unjust. But neither the size of that effect, nor any qualitative description of it, means that some other rights or duties are properly identified as having been the subject of the legislative change.
Further, it is not useful to seek to identify a connection between the original settlement of the dispute and the resulting award, as affected by the deletion of certain provisions. Nor is it useful to ask whether the award, as affected, is appropriate or adapted to the prevention of future disputes. These questions appear to proceed from the premise that s 51(xxxv) provides that there shall be a system of conciliation and arbitration for the prevention and settlement of interstate industrial disputes and then seek to test the validity of the impugned provisions against that assumed constitutional purpose. But, as noted earlier, s 51(xxxv) is not a purposive power. Item 50 deals with the legal effect given to awards by the Commonwealth conciliation and arbitration legislation. No question arises, then, of whether the law was appropriate and adapted to a purpose of the prevention of future disputes, or the settlement of existing disputes, by conciliation and arbitration.
The understanding of the operation of item 50 that we have described is reinforced when item 51 is considered. The duty which item 51(1) (as given effect by s 3) imposes on the Commission is a duty that arises "[a]s soon as practicable after the end of the interim period" and it is a duty to review each award that "the Commission is satisfied has been affected by item 50". What the Commission must then do is "vary the award to remove provisions that ceased to have effect under item 50"[159]. These provisions of item 51 are intended, then, to make the award (in the sense of the written record which the Workplace Relations Act requires the Commission to make[160]) reflect the provisions to which that Act then attributes legal significance. (Item 51(3) does no more than make plain that the task of the Commission in varying an award is not to be confined to applying a "blue pencil" to provisions that ceased to have effect; the task extends to altering the expression of the award in a way that "reasonably represents" the entitlements of employees in relation to allowable award matters.) For present purposes item 51 can be put to one side. To adopt the expression used during oral argument, items 51(1), (2) and (3) are provisions to "tidy up" the award.
If the removal of provisions from the award (or the cessation of effect of those provisions) has consequences greater than the removal of the legislative support for those provisions, the reason for those consequences must be sought elsewhere than in the legislation. In particular, if the removal of provisions has consequences for individual contracts of employment, those consequences will arise from the terms of the contract which the parties made. The contract is the relevant source of the rights, duties, powers and privileges of the parties. The award made pursuant to the statute is no more than the articulation of the terms that the contracting parties agreed would be incorporated by reference. It is the agreement which regulates what is, or is not, to be imported as a contractual stipulation.
Once the nature of the rights, duties, powers and privileges which the legislation changes, regulates or abolishes are properly identified, it is apparent that s 3 of the WROLA Act (in so far as it gives effect to items 50 and 51(1), (2) and (3)) is a law with respect to conciliation and arbitration within s 51(xxxv). It is a law the subject matter of which is the extent to which legislatively prescribed consequences are to attach to the outcome of conciliation and arbitration processes carried out by persons and bodies established and regulated by legislation enacted within power. That is, it is a law taking away part of what the legislature had validly given, namely, legal effect to awards resulting from processes of conciliation and arbitration that had been legislatively prescribed and regulated within power.
It is not necessary to attempt to classify item 50 as a repealing or amending provision to reach the conclusion that s 3 is not beyond power. As is apparent from what we have said earlier, item 50 is a provision to which s 3 "gives effect" and it is not a provision that is cast in the terms of an amendment or repeal of other legislation. It may therefore be very much doubted that it is properly described as a repealing or amending provision. In Kartinyeri[161], it was said that to seek to distinguish between amendment and repeal of legislation may suggest or assume a false dichotomy. Similarly, seeking to decide whether the classification "amendment" or "repeal" can properly apply to the legislation now in question may distract attention from the relevant inquiry. As we have said, that inquiry must identify the rights, duties, powers and privileges which, on the true construction of the provisions in question, those provisions are intended to change, regulate or abolish.
Counsel for those alleging invalidity all accepted, expressly or implicitly, that there would be no constitutional impediment to the Parliament withdrawing, from all of the awards made under Commonwealth conciliation and arbitration legislation, all of the legal effect which Commonwealth legislation gave to those awards. Counsel contended, however, that it was impermissible to withdraw from only some provisions of awards the legal effect given by Commonwealth legislation. This, it was said, constituted the regulation of conditions of employment by direct legislation[162].
The contention is flawed in at least two ways. First, it seeks to equate the prescription of terms and conditions of employment (or the prescription of the details of the award which an arbitrator is to make) with the denial of particular statutory legal significance to the terms already prescribed. There is a real and radical difference between the Parliament prescribing what the terms of employment of workers in an industry or in a particular workplace shall be and the Parliament declining to give legislative support to some kinds of provisions in an award reached as the result of a process of conciliation or arbitration. That difference lies in the rights and duties which are created in the two cases. In the former case, the rights and duties that are created are not rights that result from, or are in any real way connected with, a process of conciliation or arbitration for the prevention and settlement of industrial disputes. They are rights and duties that stem entirely from the legislative fiat. In the second case, the rights and duties that are regulated are those that are to attach to the result of a process of conciliation or arbitration.
The second flaw in the contention is that it seeks to attach constitutional (as opposed to legislative) significance to the outcome of a process of conciliation or arbitration. It is, of course, essential to bear well in mind that the constitutional power in question is a power to make laws with respect to conciliation and arbitration, not a power to make laws with respect to interstate industrial disputes[163]. That is, the constitutionally prescribed process about which the Parliament may legislate is conciliation and arbitration. But that cannot be understood as requiring that, no matter what the outcome a legislatively appointed arbitrator may choose to adopt, that outcome is for all time untouchable by Parliament. Indeed, the Waterside Workers' Case and later cases make plain that, within some limits, the Parliament can make laws permitting adjustments to the outcome of the process, whether by extending the term of the award[164], changing the parties to an award[165], or permitting the arbitrator later to vary an award made in settlement of a dispute[166]. The Parliament may provide that if the registration of an industrial organisation is cancelled, its members cease to be entitled to the benefits they otherwise would have had under an award which applied to that organisation and its members[167]. These decisions deny any absolute proposition that an arbitrated award can never be affected by what the Parliament does pursuant to s 51(xxxv).
A deal of attention was directed in argument to the Court's decision in Victoria v The Commonwealth (Industrial Relations Act Case)[168] about the then provisions of s 150A of the Industrial Relations Act. That section, and regulations made under sub‑s (3) of that section, required the Commission to review awards and identify whether they were deficient because they included (among other things) discriminatory provisions. The Commission was then obliged to remedy any deficiency in the award by varying it or taking such other action in relation to the award as it considered appropriate. It was pointed out in the joint judgment[169] that:

[255]

Those who challenged validity contended that because item 50 sought to terminate the effect of some, but not all, provisions of the Coal Award, the award as varied (whether by the cessation of effect of provisions under item 50 or the variation contemplated by item 51) would be significantly different from the award as it was originally made. It was contended that the variation could not be characterised as having any relevant connection with the original interstate industrial dispute that gave rise to the award and that, for that reason, the variation fell outside the ambit of s 51(xxxv).
As was pointed out in the Industrial Relations Act Case, variation of an award could, conceivably, result in the award no longer having the requisite connection with the dispute on which it was founded. The question in the present case is not whether the Commission has power to vary an award by determining that certain provisions are to have no effect. That step is taken by the legislature, not the Commission. It is, therefore, not to the point to ask whether the Commission would have power to do it. The question is one of legislative power. And that directs attention to the issues that have been discussed earlier.
If there is any consequence that follows from the cessation of the effect of certain provisions on the question of connection between award and dispute, it is a question that requires consideration of the connections between the remaining, effective provisions of the award and the dispute. It was submitted that the remaining, effective provisions of the award could not be said to be the product of a process of conciliation and arbitration for the prevention and settlement of interstate industrial disputes. It was said that those provisions were not the product of that process because that process had produced an altogether different award from the award to which the Act would give effect after the interim period. Thus, so it was argued, the provisions now in question were not laws with respect to conciliation and arbitration because they produced a "result" different from the result of conciliation and arbitration. An analogy appears to have been drawn between this and the hypothetical case postulated in argument in Kartinyeri[173] but not resolved. This was "of a repealing or amending Act which so changed the character of an earlier Act as to deprive that Act of its constitutional support".
This way of putting the argument can be seen to be no more than a restatement, in other words, of arguments with which we have dealt above. Speaking of the "result" of conciliation and arbitration distracts attention from the relevant inquiry: to identify the rights, duties, powers and privileges that have been changed, regulated or abolished. The relevant "result", then, is not just what has previously been published as an arbitrator's award or as a conciliated consent award; the relevant "result" is the rights, duties, powers and privileges to which that process gave rise. And the question that must be asked about the legislation that now is in question is what rights, duties, powers and privileges that legislation changes. The argument about difference in result when examined, can be seen to be one which, directly or indirectly, seeks to attribute relevant legal significance to particular provisions of awards other than the significance that was given to those provisions by the legislation. For the reasons we have given earlier, we do not accept that s 3 and the relevant items of Sched 5 deal with more than that legislative effect. Alternatively it is an argument which seeks to attach constitutional significance to the outcome of a process of conciliation and arbitration. Again, for the reasons given earlier, we do not consider that this is right.
We consider that the challenge to the validity of s 3 fails. It is, therefore, not necessary to consider the alternative argument advanced by some respondents to the proceedings for prerogative relief in which it was alleged that constitutional support for some operation of s 3 could be found in s 51(xx), the corporations power.
The order nisi for writs of certiorari, prohibition and mandamus should be discharged with costs. The amended question reserved for the consideration of the Full Court, namely,

[261]

Two proceedings are before the Court. The first proceeding is an application in the original jurisdiction of this Court that the order nisi for writs of certiorari, prohibition and mandamus be made absolute. The order nisi, as amended, was issued to members of the Australian Industrial Relations Commission ("the Commission") upon the grounds that they had acted outside their lawful jurisdiction in so far as they had given effect to s 3 of the Workplace Relations and Other Legislation Amendment Act 1996 (Cth) ("the WROLA Act") which in turn gave effect to item 50 and subitems 51(1), 51(2) and 51(3) of Pt 2 of Sched 5 to the WROLA Act ("item 50 and subitems 51(1), 51(2) and 51(3)"). In the second proceeding, also in the original jurisdiction of this Court, the plaintiffs sought a declaration that s 3 of the WROLA Act was invalid to the extent that it purported to give effect to item 50 and subitems 51(1), 51(2) and 51(3). Pursuant to s 18 of the Judiciary Act 1903 (Cth), this question was reserved for the opinion of the Full Court. As the grounds upon which relief is sought in both proceedings are substantially the same[181], it is convenient to deal with them together.
The Construction, Forestry, Mining and Energy Union ("the Union") is the first prosecutor in the proceedings on the order nisi and the first plaintiff in the proceedings giving rise to the question reserved. Mr Garry Barnes is the second prosecutor and second plaintiff respectively. He is a member of the Union and was employed by Pacific Coal Pty Ltd ("Pacific Coal"). That company is the second respondent in the proceedings on the order nisi. The first respondent to the proceedings on the order nisi is Boulton J, a Senior Deputy President of the Commission, together with the members of the Full Bench of the Commission who decided an appeal from Boulton J's orders. The members of the Commission have submitted to the orders of this Court. The Commonwealth has appeared in both matters to support the validity of the legislation. Various States intervened in the proceedings on the order nisi: Western Australia to support the validity of the legislation; and New South Wales and Queensland to support the prosecutors' contentions of invalidity.

[262]

In September 1990, in the exercise of the power of conciliation and arbitration for the prevention and settlement of an industrial dispute extending beyond the limits of a single State, the Commission made the Coal Mining Industry (Production and Engineering) Interim Consent Award ("the interim award"). On 10 December 1997, Boulton J made the Coal Mining Industry (Production and Engineering) Consolidated Award 1997[182] ("the consolidated award") which consolidated the interim award together with variations to that time. Both awards applied to persons engaged in work in the coal mining industry in New South Wales, Queensland and Tasmania. There were approximately 149 employer respondents to the awards, being companies with employees in the coal mining industry in those States. The Union represented the industrial interests of most of the employees employed in those mines. Pacific Coal was a respondent to both awards.
On 8 December 1997, the Commission, of its own motion[183], summoned the parties to the awards before it. It did so with a view to considering the requirements of the Workplace Relations Act 1996 (Cth) ("the Workplace Relations Act"), as amended by the WROLA Act, and having regard to the terms of items 47, 49, 50 and 51 of Pt 2 of Sched 5 to the WROLA Act. On 23 February 1998, application was also made on behalf of the respondents to vary the consolidated award to ensure that it would thereafter contain only "allowable award matters"[184]. The application of the respondents was joined with the award simplification proceedings commenced by the Commission itself[185]. The proceedings were heard together by Boulton J.
On 19 March 1998, Boulton J decided to separate consideration of the removal of non-allowable award matters from the award as required by subitem 49(1) of Sched 5 to the WROLA Act and s 89A of the Workplace Relations Act from "wider simplification issues" arising under subitems 49(7) and 49(8)[186]. In his decision of 26 May 1998, Boulton J made it clear that his decision to alter the consolidated award was designed to give effect to item 50 and subitems 51(1), 51(2) and 51(3). It did not necessarily reflect "any conclusion as to the merits of the relevant clauses … in providing rights and obligations in relation to the treatment of retrenched workers in the coal industry"[187]. The variations so ordered were to take effect from 1 July 1998 in relation to both the interim award and the consolidated award[188].
Appeals were lodged against the orders of Boulton J both by the Union and by the industrial organisation which represented the respondents. The appeal by the Union was dismissed[189]. The appeal by the respondents succeeded to the extent that the Full Bench of the Commission overturned part of the decision of Boulton J and ordered that cl 9, which related to conditions not dealt with by the award, should be deleted[190]. It was common ground that, in varying the award in the manner stated, the members of the Commission were exercising powers purportedly arising under item 51, and not under s 113 of the Workplace Relations Act nor under item 49 of Sched 5 to the WROLA Act[191].
Apart from cl 9, the variation of the consolidated award included the deletion of the following clauses: cl 10 (the right to be consulted over major changes affecting employees); cl 16.1 (the right to discussions before termination of employees); cl 16.2 (reduction of employees on the principle "the last to come, the first to go"); cl 39 (preference to unionists); cl 40 (preference to retrenched members of specified unions); cl 41 (right of entry of authorised Union representatives onto the premises of employers); cl 42 (preference of employment in re-engagement); and cl 44 (the right of a union steward, such as Mr Barnes, to interview employer and employee representatives during working hours)[192]. These variations to the award affected both the Union and Mr Barnes.
Matters came to a head in July 1998 when Pacific Coal decided to retrench a number of employees then working at its Blair Athol mine in Queensland with effect from August 1998. Mr Barnes was one of those chosen for redundancy. This would not have happened had "the last to come, the first to go" principle of selection for retrenchment been observed, as was required by the former cl 16.2 of the consolidated award. Upon his retrenchment, Mr Barnes enjoyed no rights to preference of employment at other Queensland mine sites, as was required under the former cl 39 of the award. The Union and Mr Barnes submitted that the Commission, in varying the award, and Pacific Coal, in retrenching Mr Barnes, had acted unlawfully. If s 3 of the WROLA Act, in so far as it purported to give effect to item 50 and subitems 51(1), 51(2) and 51(3), were unconstitutional, the alterations of the consolidated award effected in pursuance of its requirements were invalid. If this were so, the Union and Mr Barnes would continue to be entitled to the benefits of the consolidated award as it stood prior to the invalid alterations.
At the commencement of the hearing in this Court, a number of companies sought, and were granted, leave to be joined as parties to the proceedings on the return of the order nisi. Each of them is bound by the awards and each was thus affected by the outcome of the proceedings. They wished to make submissions additional to those advanced by Pacific Coal to support the validity of the impugned section of the WROLA Act by reference to s 51(xxxv) of the Constitution. But they also wished to advance an argument which Pacific Coal, the Commonwealth and Western Australia declined to support. That argument was to the effect that the impugned section of the WROLA Act, and consequently the variations made pursuant to that section, could, if necessary, be supported by reference to the power with respect to constitutional corporations in s 51(xx) of the Constitution. It was argued that this was so by virtue of s 7A of the Workplace Relations Act. It will be convenient to deal with this alternative submission after the principal arguments concerning the requirements of s 51(xxxv), together with s 51(xxxix), have been considered.
One final point should be noticed in this outline of the facts. Originally, the Union and Mr Barnes relied on another argument to attack the constitutional validity of item 50 and subitems 51(1), 51(2) and 51(3). This was the contention that, if otherwise valid, those items (and, to that extent, s 3 of the WROLA Act giving effect to them) would have had the effect of acquiring property otherwise than on just terms contrary to s 51(xxxi) of the Constitution. The order nisi included a question addressed to that ground of objection. It was also one of the suggested grounds of invalidity asserted in the statement of claim upon the basis of which the question of constitutional law was reserved for the opinion of this Court. On the return of the proceedings, the Union and Mr Barnes did not argue this additional suggested basis of invalidity. It can therefore be disregarded.

[263]

The WROLA Act was designed to introduce major changes to federal legislation governing industrial relations. The stated purpose, as set out in the Minister's Second Reading Speech[193], was to alter the system of industrial relations established by the Parliament from one heavily reliant upon awards and orders achieved as the outcome of conciliation and arbitration to one where most industrial disputes would be settled by local agreement either in the form of a certified agreement[194] or an Australian workplace agreement[195]. The recast statement of the principal objects of the Workplace Relations Act[196] asserts a deliberate shift of focus away from arbitration to conciliation and a general confinement of the Commission's arbitral functions enjoyed under the previous legislation[197]. The legislation was, once again, renamed to symbolise these further changes of direction[198]. Changes throughout the Workplace Relations Act are designed to carry these general objectives into effect.
Section 89 of the Workplace Relations Act defines the general functions of the Commission as being to "prevent and settle industrial disputes". Following the amendments, a key new section of the Workplace Relations Act is s 89A, which is headed "Scope of industrial disputes"[199]. There was no such section in the Industrial Relations Act 1988 (Cth). Sub-section 1 defines an "industrial dispute" as including only those matters covered by sub-s 2 and sub-s 3, and subs 2 limits these matters to 20 "allowable award matters". Although sub-s 7 allows an exemption for an "exceptional matter" and sub-s 8 provides that nothing in the section prevents the Commission from including a model anti-discrimination clause in an award, clearly the basic object of s 89A is to narrow substantially the matters that can be classified as an industrial dispute. It therefore reduces the scope of matters which may be made the subject of an award or order, or the variation of an award or order, by the Commission, under the general powers given to it by the Workplace Relations Act. Some of the other items of Sched 5 to the WROLA Act, such as item 35[200], subitem 49(8)(d) and subitem 51(7)(d), are concerned with the removal of obsolete or ineffective provisions from awards. Item 50 and subitems 51(1), 51(2) and 51(3) must be understood in the context of these policy and legislative changes.
If s 89A of the Workplace Relations Act had been added without more, its sole effect would have been to limit the subject matters with which the Commission might deal in any future award, or variation of an existing award, in the exercise of its powers[201]. Section 89A would not, in its own terms, have affected the provisions of existing awards (such as the interim award or the consolidated award). Such provisions as were not "allowable award matters"[202] would have continued to be effective. By the terms of s 89A, and the conventional principle of prospective operation of legislation, the section would have affected only the making of new awards and variation by the Commission.
By subitem 49(1) of Sched 5, it is provided:

[267]

By item 46 of Sched 5 to the WROLA Act, the phrase "interim period" in the above items is defined to mean "the period of 18 months beginning on the day on which section 89A of the Principal Act commences". In the same item, the "Principal Act" is defined to mean the Workplace Relations Act. Section 89A was effective from 1 January 1997. Accordingly, the "interim period" began on that day. It extended until 30 June 1998.
Neither the Union nor Mr Barnes submitted that s 89A of the Workplace Relations Act itself was invalid. In so far as that section controlled the future conduct of the Commission, whether in making or varying awards, the Union and Mr Barnes accepted that this was within the law-making power of the Parliament under s 51(xxxv) of the Constitution. They also acknowledged that, following the amendments to the Workplace Relations Act effected by the WROLA Act, various avenues would have been available to Pacific Coal, including to seek the cancellation of the awards, the making of a new award following notification of a new dispute, or the exercise by the Commission of its power of variation which, after the interim period, would have had to conform to s 89A of the Workplace Relations Act. None of this, it was said, could have been contested on constitutional grounds. So much is therefore undisputed in these proceedings.
However, the Union and Mr Barnes argued that it was not competent for the Parliament to purport to alter by legislative fiat (as they described it) the force and effect of an award previously made by the Commission. Nor was it within the power of the Parliament, by legislative prescription, to withdraw the operation and enforceability of particular terms of an existing award that was in force. They submitted that what was thereafter enforceable no longer matched the description of an award of the Commission at all. Most importantly, it was not competent for the Parliament to alter the outcome of conciliation and arbitration in a way that resulted in binding rules on industrial conditions when such rules were not made for the prevention and settlement of an interstate industrial dispute, as was required both by the Workplace Relations Act and by the Constitution[204].

[269]

The terms in which the law-making power conferred on the Parliament by s 51(xxxv) of the Constitution are expressed impose "profoundly important limitations"[205] on the shape of federal legislation that is reliant on that power. The most important of these is the limitation restricting the power to make laws for the prevention and settlement of interstate industrial disputes to laws involving particular processes, namely "conciliation and arbitration". These words connote the settlement of a question in dispute by reference to a third party or parties when those immediately involved have failed to agree[206]. The process for such settlement must answer to the description of "conciliation" or "arbitration" or both. The opinion which the conciliator or arbitrator reaches "may take any form the law provides; it may be called an order, or an award"[207]. It has no legal force or effect (unless the parties exceptionally contract to give it such). Ordinarily, therefore, an Act of the Parliament is required to attach legal rights and obligations to the award or order of the conciliator or arbitrator which will carry it into effect. This Court has emphasised that, however flexible may be the procedures adopted[208] and however large the ambit of the power once engaged, they do not extend to the regulation of industrial conditions by direct legislation[209]. If the Parliament legislates at all in reliance on s 51(xxxv), it must do so in the particular way that s 51(xxxv) obliges.
This point was made both by the majority and the minority in the Waterside Workers' Case[210]. In issue in that case was the constitutional validity of a statutory provision which stated that, in the absence of an order of the Court of Conciliation and Arbitration to the contrary, an award should continue in force from the date of the expiration of the period provided in it until a new award was made[211]. This Court divided over whether it was competent for the Parliament to extend the duration of an award in such a way. The dissenting joint reasons of Isaacs and Rich JJ argued forcefully that the Parliament could not, by legislative prescription, so provide[212]. The majority held that Parliament could so legislate[213].
Both the majority and the minority in that case found common ground in the limited character of the legislative power conferred by s 51(xxxv) of the Constitution. Thus Knox CJ[214] emphasised the way in which the legislation had constituted the tribunal (then called a court) with plenary power to act according to its unfettered discretion in settling industrial disputes of a given character. His Honour considered that it was open to the Parliament to circumscribe and define the powers which that tribunal might exercise in performing its functions. This included the specification of machinery provisions fixing the duration of any award which the tribunal, in its discretion, had made. Knox CJ went on[215]:

[275]

The large degree of agreement in the Waterside Workers' Case was also reflected in the opinion of Higgins J, a member of the majority. He classified the disputed section as nothing more than a continuance of the duration of the award, it being "agreed on all sides that Parliament cannot affirmatively or directly prescribe conditions of employment by its own enactment"[218]. The majority were prepared to regard the continuance of the award beyond its original date by the statutory tribunal, and subject to the tribunal's power to order otherwise, as a law "with respect to" conciliation and arbitration[219]. But none of the participating Justices suggested that legislation which altered an existing award by changing its terms and thereby disturbing its balances and imposing different obligations on the parties to it would be permissible. To the contrary, the reasoning of the entire Court suggests the opposite conclusion.
Since that decision in 1920, a number of cases have come before this Court in which the power of the Parliament under s 51(xxxv) (together, where necessary, with the incidental powers under s 51(xxxix)) to make laws affecting an award of the statutory tribunal has been explored. I leave aside the exceptional cases in which, during and immediately after wartime, the defence power has been invoked in relation to the powers of the statutory tribunal[220]. The exceptional character of the decision in the Waterside Workers' Case, and the fact that s 28(2) of the Commonwealth Conciliation and Arbitration Act 1904 (Cth) had "escaped being held unconstitutional" but "only by the narrowest of margins"[221], encouraged the restatement by this Court that the Parliament could not make "laws simply for the prevention and settlement of such industrial disputes; they must be laws for the prevention and settlement thereof by means of conciliation and arbitration"[222].
In every case in which the issue has been revisited, legislation relating to the order or award of the statutory tribunal had to be brought back to the prevention or settlement of some particular interstate industrial dispute in order to maintain its constitutional validity. For example, in R v Commonwealth Court of Conciliation and Arbitration and Australian Railways Union; Ex parte Victorian Railways Commissioners[223], Dixon J emphasised the importance for the decision in the Waterside Workers' Case of the fact that s 28 of the Commonwealth Conciliation and Arbitration Act preserved to the tribunal the power of variation, should that be considered necessary. His Honour said[224]:

[277]

A decision in some ways analogous to the Waterside Workers' Case was George Hudson Ltd v Australian Timber Workers' Union[225]. There the Court, again by majority[226], upheld as valid s 24(1) of the Commonwealth Conciliation and Arbitration Act when it was amended to include the words "or any successor, or any assignee or transmittee of the business of a party bound by the agreement, including any corporation which has acquired or taken over the business of such party"[227]. The effect of this change was to increase the parties bound by the agreement settling an interstate dispute. In that case, a fortnight after the original agreement was registered in the tribunal, a party called "George Hudson and Son Limited" changed its name to "George Hudson Limited".
The dissentients in Hudson argued powerfully[228] that the combined effects of s 51(xxxv) and s 51(xxxix) of the Constitution did not suffice "to impose, either by direct enactment or through the medium of an arbitrator, obligations on persons who are not parties to an existing or probable industrial dispute"[229]. However, Isaacs J, in the majority, pointed out that "the only difference, so far as appears, is a mere change in name"[230]. Were it not possible by legislation to apply the agreement to the renamed company, his Honour considered, "the whole fabric of the constitutional power may be, and in actual practice must be, utterly ineffective and useless"[231]. The agreement duly made could thus be extended to the successors and assignees of those originally bound by it. But this accepted the agreement as it stood in its entirety. True, it enlarged the parties to whom it applied. But it did not purport to alter its contents in any way.
In 1953, the question arose as to whether an award might be varied without the necessity of a fresh interstate industrial dispute arising. In an extension of the logic which had sustained the statutory provisions for the continuance of an award in force after its initial term, this Court held in R v Kelly; Ex parte Australian Railways Union[232] that it was not necessary that a fresh dispute exist. Awards might be varied by the statutory tribunal to ensure that the original settlement remained appropriate in the light of changed industrial circumstances. However, the power which was upheld[233] was one which authorised the tribunal, of its own motion and without the consent of the parties, to vary the award, so long as the revision or review remained within the limits of the subject matter and the boundaries of the original interstate industrial dispute[234]. This Court read down the power conferred on the tribunal by legislation to vary an award "for any reason", so that the phrase was "restrained by construction to the purpose of preventing or settling industrial disputes"[235]. Dixon CJ[236] was at pains to emphasise the limitation imposed upon the tribunal by the fact that it derived its authority from the exercise of legislative power, which was in turn dependent upon s 51(xxxv) of the Constitution[237]. The reasoning of all members of this Court is therefore consistent only with alteration or adjustment of the detailed provisions of an award by the body which originally made the award, namely the statutory tribunal. It is inconsistent with any direct enactment by the Parliament of a common rule or any other terms of national application which affect particular industrial conditions in an award.
The extent to which the Parliament could direct the statutory tribunal as to the level of wages to be prescribed was considered in R v Commonwealth Conciliation and Arbitration Commission; Ex parte Amalgamated Engineering Union (Australian Section)[238]. In that case, Barwick CJ[239] restated the proposition that s 51(xxxv) did not afford the Parliament a general power to legislate the level of wages to be paid under an award. However, his Honour[240] accepted that it was permissible to prescribe a given procedure or manner of dealing with alterations, as the impugned section had done in that case[241]. In the opinion of Windeyer J[242]:

[284]

What follows from the foregoing history of the authority of this Court? First, and this is common ground between the parties, pursuant to s 51(xxxv) of the Constitution, including as enhanced by s 51(xxxix), it is not competent for the Parliament to enact general laws directly governing the industrial conditions of employers and employees in Australia. Any such laws must, in the terms of s 51(xxxv), be laws with respect to the prevention and settlement of interstate industrial disputes by means of conciliation and arbitration.
Secondly, the Parliament cannot itself, under such powers, legislatively mandate the outcome of conciliation or arbitration. It can only legislate to enable such processes, the limits within which the process will be carried out, the incidents of their outcome and the application of the outcome of that process for a longer period or to additional or different parties than originally ordered.
Thirdly, after the outcome is concluded by conciliation or arbitration, the Parliament can direct the Commission to conduct reviews and even require it to vary an existing award. But this direction will be valid only if three conditions apply: (1) that any variation of the award preserves an outcome which can still be characterised as connected with the interstate industrial dispute on which the original award was founded; (2) that standards are stated, reflecting current industrial standards by reference to which the Commission is obliged to act; and (3) that the task of variation is reserved to the Commission, which retains a discretion to act or not to act. The task of variation, deprived of any discretion, cannot be imposed on the Commission, for that would be inimical to the essential character of conciliation and arbitration which the Constitution mandates.
Fourthly, where legislative provisions operate on the outcome of conciliation or arbitration (such as to continue its operation beyond its original term; to extend its application to the successors and assignees of original parties; to contemplate its variation; or to require review and the consideration of variation by reference to new standards), the outcome so altered must still be capable of characterisation as arising from conciliation or arbitration for the prevention and settlement of an interstate industrial dispute. Its title as an "award" or "order" of the Commission is immaterial. It is its character as the outcome of the process that is essential, for otherwise the necessary connection with the posited constitutional powers will have been lost. If it cannot be so characterised, the Parliament will have attempted to legislate by direct enactment on the subject of industrial conditions. No invocation of the incidental power in s 51(xxxix) could cure such an impermissible attempt to legislate in a way beyond that permitted by s 51(xxxv) of the Constitution.
Tested by these standards, s 3 of the WROLA Act to the extent that it purports to give effect to item 50 and subitems 51(1), 51(2) and 51(3), appears to exceed the law-making powers of the Parliament under s 51(xxxv) as supplemented by s 51(xxxix). On the face of it, item 50 appears to be a direct attempt by the Parliament to legislate upon the industrial conditions of persons subject to the awards affected, and specifically in relation to the provisions of such awards that are defined as being outside "allowable award matters". This has been done in respect of industrial disputes having a definition, scope and content which existed prior to the enactment of the WROLA Act. No attempt has been made in sub-item 50(1) to provide criteria for, or to reserve a discretion to, the Commission as conciliator or arbitrator. Whilst it is true that subitems 51(1), 51(2) and 51(3) confer power on the Commission, and, in the case of subitem 51(3), a discretion, all of these subitems are ancillary to item 50. They are designed to implement the purpose of that item and subitems 51(1) and 51(2) impose duties on the Commission to that end.
Therefore, the alteration or deletion of provisions from awards is purportedly performed by force of sub-item 50(1) itself as it is given effect by s 3 of the WROLA Act. No function whatsoever is reserved to the Commission. It is by the operation of sub-item 50(1) that awards cease to have effect to the extent that they provide for matters other than "allowable award matters". On the face of things, this means provisions of the award deemed to be other than "allowable award matters" cease to have effect whether as a provision of the award or otherwise, eg as a condition of the contract of employment imported into the relationship of employer and employee by reason of the award provisions[246].
Whilst sub-item 51(1) is expressed in terms of requiring the Commission to review each award, its operation is dependent upon item 50 by reason of par (b) of subitem 51(1). Similarly, subitem 51(2) is posited on the assumption of the operation of item 50. Subitem 51(3) being, in its turn, inextricably linked to the obligation of variation under subitem 51(2), it is also dependent on the operation of item 50. Because, in my view, s 3 of the WROLA Act is invalid to the extent that it purports to give effect to item 50, item 50 is inoperative. Therefore, subitems 51(1), 51(2) and 51(3) are also inoperative. The items fall together.

[289]

There is no doubt that the words "with respect to" in s 51 of the Constitution confer a most ample power to make laws. This is so in respect of every head of legislative power, as befits a Constitution[247]. It is so in the particular case of the power to make laws with respect to conciliation and arbitration provided by s 51(xxxv)[248]. It is sufficient that the law in question has an appropriate relevance to, or connection with, the subject specified[249]. Anything reasonably and properly incidental to the effectuation of the purpose embodied in the power is within the legislative grant[250]. The task of this Court, where the constitutionality of a law is challenged, is one commonly described as characterisation of the law in question[251]. It is not necessary, in order to establish the constitutional validity of a law, that it should be shown to be essential or indispensable to the fulfilment of the power. It is enough that it is appropriate to give effect to the exercise of the power[252]. If this is shown, the law is within the constitutional grant. That is so without invoking the express constitutional provision of s 51(xxxix) in relation to matters incidental to the execution of a power.
Pacific Coal submitted that items 50 and 51, as given effect by s 3 of the WROLA Act, were laws with respect to conciliation and arbitration because they operated upon awards made in the past by a process answering that description. The fact that their operation involved the undoing of part of the outcome of that process was, so it was submitted, irrelevant to the impugned law's constitutional validity. Western Australia added to this argument that items 50 and 51 were to be viewed as part of a legislative scheme by which the Parliament was reforming the Workplace Relations Act in a manner designed to lay more emphasis upon conciliation rather than arbitration and to prevent interstate industrial disputes by means of workplace and other agreements instead of settling them by means of arbitrated awards. As it was open to the Parliament, in accordance with s 51(xxxv) of the Constitution, to refocus the priorities of federal law in such a way, so it was said, then s 3 of the WROLA Act which was designed to give effect to the changes contained in items 50 and 51 was within power.
These submissions are rejected. The power afforded to the Parliament by s 51(xxxv) is not simply one to make laws with respect to conciliation and arbitration. The "conciliation and arbitration" referred to in s 51(xxxv) is qualified by a descriptive limitation requiring that any law reliant on that paragraph be "for the prevention and settlement of industrial disputes extending beyond the limits of any one State". Accordingly, it is not open to the Parliament, by a direct legislative attempt, to impose new and different terms and conditions of employment on those subject to an existing award or order simply because the law in question targets, as its legislative objective, the alteration of an award or order of the Commission. It remains necessary that, for the law to be valid, it should still answer to the description contained in s 51(xxxv) in all of its elements.
Were it otherwise, it would necessarily follow that once an award or order was made by a process of conciliation or arbitration to prevent or settle an interstate dispute, the Parliament would thereafter enjoy the uncontrolled, or virtually uncontrolled, power to legislate to alter some or all of the matters dealt with in the award as it saw fit. By doing so, it could completely change the balance struck by the conditions established by the award or order in question. Thus, it could effectively delete all of the provisions in an award which had been included as the outcome of conciliation or arbitration. An award might contain provisions for higher than standard wages in compensation for obligations to work longer than standard overtime hours. If part of the industrial balance were altered and, say, the provision relating to hours was effectively deleted by legislation, the result would not be the partial enforcement of the award made by the process of conciliation and arbitration. It would be the creation of an entirely new binding rule, made in effect by the Parliament and owing nothing but history to the origins of the original award made as part of an interstate industrial dispute.
In the present case, provisions of existing awards have been effectively deleted by the Parliament which might be thought to have been generally favourable to the Union and to workers such as Mr Barnes. But if the deletion of such provisions is constitutionally permissible, it necessarily means that, on a future occasion, the Parliament could delete provisions favourable to, or protective of, employers. This would amount to a most substantial enlargement of the powers of the Parliament under s 51(xxxv) of the Constitution because it would allow the Parliament to make laws directly concerned with industrial conditions in employment throughout Australia. It would permit this in a way contrary to the limited power which the founders included in the constitutional text[253]. It would also do so in the face of the repeated refusal of the electors at referendums to enlarge that power[254]. And it would do so in a way wholly inconsistent with the unbroken line of decisions of this Court from the earliest days of its existence[255].
No doubt there is substantial constitutional power for the Parliament to make laws with a greater emphasis on conciliation and on the prevention of interstate industrial disputes[256]. So far as the amendments to the Workplace Relations Act introduced by the WROLA Act were said to be for that purpose, neither the Union nor Mr Barnes contested the validity of s 89A of the Workplace Relations Act. However, that provision operates prospectively to limit the matters that may constitute an "industrial dispute" for the purposes of the federal legislation. Section 89A does not attempt in any way to interfere with a previous settlement, by conciliation or arbitration, of an interstate industrial dispute, whereas item 50, as given effect by s 3 of the WROLA Act, intrudes directly into such a settlement. It attempts to redraw the terms of such a settlement and thereby necessarily imposes on the parties, as the purported will of the Parliament, something that amounts to a new industrial settlement. The resulting rule is not the outcome of conciliation and arbitration. It is the outcome of direct federal legislation, which is not constitutionally permissible under s 51(xxxv).

[291]

The second argument for the validity of s 3 of the WROLA Act, to the extent that it gives effect to item 50 and subitems 51(1), 51(2) and 51(3), commenced from the undisputed proposition that an award of the statutory tribunal has no binding force in law, as such, except to the extent that the Parliament endows it with legal significance and provides for its enforcement[257]. Based on this proposition, it was open to the Parliament to provide for the enforcement of award provisions, or to provide that either none or only some of the provisions would be enforced. An analogy was drawn with the decision of this Court which held that an award might continue to operate beyond the duration originally fixed for it[258].
It was pointed out that the award in question here operated for six months only from 4 December 1997[259]. Thereafter, its effectiveness was continued by s 148(1) of the Workplace Relations Act, the successor to s 28(2) of the Commonwealth Conciliation and Arbitration Act which was upheld in the Waterside Workers' Case[260]. Because the only operation of the award to which items 50 and 51 applied was a legislative extension of what had originally been done by way of conciliation and arbitration, it was submitted that any limitation of such a legislative extension must equally be valid. This included, so the submission ran, a partial confinement in respect of some of the matters covered by the award, being the non-allowable award matters as defined by the Parliament.
These arguments are also rejected. So far as the enforceability of awards of the Commission is concerned, it is true that they are reliant upon the Workplace Relations Act in several ways[261]. But the factum to which the Parliament may attach statutory consequences must remain recognisably the outcome of conciliation and arbitration of the kind described in s 51(xxxv) of the Constitution. To the extent that the Parliament chooses to withdraw selectively enforcement of an award or order of the Commission achieved through these processes, it runs the risk that the result will not truly answer to the description of an outcome of conciliation and arbitration. Thus, to the extent that the Parliament has legislated that identified non-allowable award matters cease to have effect in item 50, as given effect by s 3 of the WROLA Act, it has produced a new outcome of binding provisions not decided by the Commission but selected by the Parliament. At least where the excisions are as substantial as those that have occurred in the present case, affecting as they do the valuable pre-existing rights of the Union, Mr Barnes and other employees, the resulting hybrid is no longer capable of classification as the outcome of conciliation and arbitration of a pre-existing interstate industrial dispute. Indeed, the result is not the product of conciliation and arbitration at all. It is the product of legislation. And, most importantly, it has no connection, as such, with the interstate industrial dispute which first gave rise to conciliation and arbitration.
The result must therefore depend entirely on some other source of law-making power for its constitutional validity. The only one of present relevance is s 51(xxxix). But as that head of power is itself limited to "[m]atters incidental to the execution of any power vested by this Constitution in the Parliament", items 50 and 51, as given effect by s 3 of the WROLA Act, cannot be made valid by reference to s 51(xxxix). The purpose of these items is to prevent execution of the pre-existing outcome of conciliation and arbitration, not to execute the award made by that process. It is to do so selectively and by reference to a legislative judgment, rather than by reference to the process outlined in the Constitution and undertaken by a statutory tribunal that is independent of the parties and of the Parliament.
There is a world of difference between continuing in operation an entire award after the initial duration fixed in the award (and subject always to the power of the statutory tribunal to order otherwise) and the selective extinguishment of particular provisions of an award as determined by the Parliament. Such partial extinguishment is incompatible with the decision of this Court in the Industrial Relations Act Case[262]. It would have been open to the Parliament to have specified an obligation to review awards, criteria for variation, and a time limit for this to be performed by the Commission, all of which would have been permissible under s 51(xxxv) of the Constitution. But this is not what it did.

[299]

The second step, assuming the first to be safely negotiated, is to ask, in the case of a posited amendment or partial repeal, whether, if effected, it would have the consequence of depriving the relevant legislation of some element necessary to its constitutional validity. An obvious example would arise in the case of federal legislation involving acquisition of property on just terms, as required by the Constitution[267], but which amending legislation purported to alter by deleting the essential provisions for compensation. Plainly, there will be borderline cases where an amendment would have a similar invalidating result and others where it would be within the power of the Parliament. The total repeal of an Act is different from amendment or partial repeal. But, to be effective, partial repeal or amendment must leave in place a law which can still answer to all of the applicable constitutional requirements.
Item 50 fails on both steps. Properly characterised, in the way Kitto J explained in Fairfax, it is not a partial repeal or amendment of the enforcement sections of the Workplace Relations Act as to awards generally. It is a particular enactment with respect to itemised subject matters of awards whereby, contrary to authority, the Parliament has purported to make a law directly binding on industrial conditions otherwise than by way of conciliation and arbitration for the prevention and settlement of an interstate industrial dispute. Moreover, were item 50 to be treated as a partial repeal or amendment of the general sections of the Workplace Relations Act governing the enforcement of award provisions, it would still be invalid. This is because it would take the Workplace Relations Act, as so amended, outside the constitutionally permitted boundaries in at least two respects. It would effectively impose a new settlement on the parties to an award by legislative fiat, and not by conciliation or arbitration. It would do so without reference to the interstate industrial dispute which was the foundation of the original award, replacing the settlement of such dispute with a general statutory provision for which no warrant exists in s 51(xxxv) of the Constitution.
For these reasons, none of the arguments to sustain the constitutional validity of s 3 of the WROLA Act to the extent that it purports to give effect to item 50 and subitems 51(1), 51(2) and 51(3) succeeds. The section and the items are unsupported either by s 51(xxxv) or s 51(xxxix) of the Constitution. Unless they can be supported in the manner suggested by the added respondents in the order nisi proceedings, it will be necessary to sever item 50 and subitems 51(1), 51(2) and 51(3) from the rest of the WROLA Act. In my view, that could be done without requiring any substantial rewriting of the WROLA Act. The items in question do not purport to have more than a limited and transitional operation. Other provisions of the Workplace Relations Act exist which would permit the Commission to repair the suggested defects in current awards in the exercise of its general power. When the offending items are excised, there is no invalidity in the operation of s 3 of the WROLA Act. At least there is none to which attention was drawn in these proceedings.

[307]

Sub-section 5 defines an "invalid application" in relation to a provision as one which exceeds the Commonwealth's legislative power and a "valid application" in relation to a provision, if it is the only application, as one within the Commonwealth's legislative power. Pacific Coal did not rely upon s 7A. Nor did the Commonwealth or Western Australia support this argument.
The added respondents sought to invoke s 7A of the Workplace Relations Act so as to afford a constitutional foundation for so much of s 3 of the WROLA Act and item 50 and subitems 51(1), 51(2) and 51(3) as applied to awards binding upon constitutional corporations such as themselves. It was conceded that such awards, in their terms, made no differentiation between parties which were corporations and parties which were not. On the face of the items (and also the Workplace Relations Act, in so far as it deals with the variation, cancellation and enforcement of awards containing provisions dealing with matters other than "allowable award matters"), it is clear that no relevant differentiation is made by the Parliament between treatment of corporations and non-corporations. Yet it was said that s 7A of the Workplace Relations Act evinced the intention of the Parliament, in a case such as the present, to sustain the valid application of the impugned items in relation to award parties which were corporations and, by inference, to require severance of the award provisions so far as they would otherwise apply to respondents which were not corporations and for whom s 51(xxxv) afforded no basis for constitutional validity.
There are a number of insurmountable difficulties with this argument. In its terms, s 7A of the Workplace Relations Act is expressed to apply "unless the contrary intention appears". The principal objects of the Workplace Relations Act in s 3 do not suggest a purpose to institute, in effect, a completely different regime of industrial relations in respect of awards covering employees of constitutional corporations formed within the limits of the Commonwealth, on the one hand, and employees of everybody else affected, on the other. Nor is there anything in the terms of s 3 of the WROLA Act or item 50 or subitems 51(1), 51(2) or 51(3) which suggests a legislative purpose to confine the operation of those items to constitutional corporations. Those propounding this argument conceded that the contrary was the case. But they submitted that s 7A nonetheless obliged courts, faced with a challenge to constitutional validity, to perform the task of severance in order to rescue those parts of the Workplace Relations Act which might have a valid operation.
A more fundamental difficulty encountered in the invocation of s 7A is that, of itself, it has no operative force or effect. It does no more than to state the intention of the Parliament. Whilst that might, in a particular case, be of some relevance to the analysis by a court, it has no relevance to a case such as the present where the operative provisions of s 3 of the WROLA Act and of item 50 and subitems 51(1), 51(2) and 51(3) do not discriminate between corporations and other parties to awards and therefore afford no foothold for a court to give effect to a parliamentary intention, even assuming that it was relevant and appropriate for a court to do so. Having reached this conclusion, it is unnecessary to explore deeper questions such as the constitutional foundation, in the context of the Workplace Relations Act, for the enactment of a provision in the terms in which s 7A appears[268]. Or whether it is competent for the Parliament, when it does not itself identify its reliance on a particular constitutional head of power, to oblige a court such as this Court to search for a relevant head of power for a provision such as s 7A[269].
In the circumstances, I do not consider it necessary to explore this question further. The provisions of s 7A of the Workplace Relations Act afford no alternative foundation to permit this Court to redraw item 50 or subitems 51(1), 51(2) or 51(3) and s 3 of the WROLA Act so as to confine their operation to constitutional corporations. No other head of constitutional power being relied upon or appearing, those items, and s 3 of the WROLA Act to the extent that it purported to give effect to those items, are of no effect. The offending items should be, and can be, excised, leaving s 3 of the WROLA Act otherwise operative and valid.

[312]

CALLINAN J. Whilst it may, with respect, be accepted, as McHugh J says in his reasons for judgment in this case[270], that if the Commissioner's discretion is confined too narrowly it may reach a point where it is proper to say that it is the Parliament, and not the Commission, which is determining the issue which is the subject of the purported discretion, whether that was so in this case was not, so far as the operation of s 89A of the Workplace Relations and Other Legislation Amendment Act 1996 (Cth) ("the Act") is concerned, in contention. All parties argued the case upon the basis that the section was a valid enactment. The only challenge that was mounted by the prosecutors was to s 3 of the Act to the extent that it operated to give effect to item 50 and subitems 51(1), (2) and (3) in Pt 2 of Sched 5 to the Act. It is apparent that the scheme of the legislation is to confine the operation of awards to allowable award matters as defined by s 89A of the Act both past and prospective, by, in effect withdrawing legislative coercive power in respect of the former to the extent that such awards would otherwise extend beyond these matters. That this is the purpose, how it is to be achieved, and that its achievement is within constitutional power are explained in the reasons for judgment of Gummow and Hayne JJ.
Against the background of the common assumption of the validity of s 89A of the Act, and having regard to the fact that s 51(xxxv) of the Constitution confers power with respect to the prevention as well as the settlement of industrial disputes, I would regard s 3 and the challenged items as a legitimate exercise of the power which s 51(xxxv) grants to the Commonwealth to do two things: first to withdraw legislative support for parts of awards previously binding the parties under the industrial legislation in force when they were made; and, to redefine the extent to which awards so made will enjoy the support of underpinning legislative effect.
There may very well be, as McHugh J points out, elements of compromise in the affected award some of which may not readily be able to be isolated. But it might equally be said that an award such as this one may contain elements repugnant to parties bound by it. It may even be anathematical in whole to some parties, but the industrial regime in this country has nonetheless for a very long time operated to impose awards upon such parties. It does not therefore seem to me to be anomalous that the challenged provisions might in some way affect the balance of compromises (if any) contained in it. However, in any event subitem 51(3) provides that the Commission when varying an award may also vary it, so that in relation to an allowable award matter, the award is expressed in a way that reasonably represents the entitlements of employees in respect of that matter as provided in the award in force immediately before the interim period. In short, it might confidently be expected that any concern about the prospective loss of a benefit achieved by a compromise would usually be the subject of debate and argument in the Commission. Furthermore, such a matter could also in all probability be the subject of a bona fide interstate industrial dispute.
Subject only to the matters which I have mentioned I agree with the reasons for judgment of Gummow and Hayne JJ and would join in the answers and orders their Honours propose.

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