Shop Distributive and Allied Employees' Association v Woolworths SA Pty Ltd

the court 1 The appellant, Shop Distributive and Allied Employees' Association ("SDA") is an organisation of employees registered pursuant to the Fair Work (Registered Organisations) Act 2009 (Cth). The respondent is a major employer in the retail sector in South Australia and elsewhere. SDA appeals from a judgment of a single judge of the Court dismissing its application for a declaration that the respondent breached cl 48 of the Woolworths (SA, NT and Broken Hill) Certified Agreement 2006 ("the Agreement"). 2 Clause 48 of the Agreement concerns public holidays. It sets out the days, or substitute days, on which public holidays are to be observed and provides for payment to employees at specified penalty rates for work performed on such days. 3 The question for determination before the primary judge, and now on appeal, was whether the respondent was bound to pay its employee, Ms Clifford, at public holiday rates for work performed on Anzac Day 2010 in circumstances where she received public holiday rates for work performed on 26 April 2010 and the Sunday rate for work performed on 25 April 2010. 4 Under the Agreement an employee who is required to work on a public holiday, and does perform work, must be paid at the rate of double time and a half with a minimum engagement of four hours. 5 In South Australia, Anzac Day (April 25) amongst other days set out in cl 48.5.1 of the Agreement is a listed public holiday. Immediately prior to setting out the list of public holidays in cl 48.5.1, the Agreement in cl 48.5 provides: Public Holidays are the days (or substitute days) on which the following holidays are observed: 6 Clause 48.5.4 is headed "Additional Holidays" and provides: Any other day which is declared to be a public holiday pursuant to the Holidays Act, 1910 shall be a public holiday for the purposes of this clause. 7 Clause 48.6 provides for "holidays in lieu" when certain public holidays, but not Anzac Day, fall on a weekend day. 8 Clause 48.10 refers to a situation where a full time employee who normally works on weekends as part of ordinary time and where a public holiday falls on a weekend day. In those circumstances, if an employee is required to work on the public holiday, that person is entitled to a substitute day off. But, if the employee works both the public holiday and the substitute day, the employee will only be paid the normal rate for the actual public holiday. That is, the employee does not receive public holiday rates for both days. 9 At all material times s 3A of the Holidays Act 1910 (SA) ("Holidays Act") provided that: Anzac Day In addition to the days mentioned in Schedule 2, 25 April will be a public holiday and bank holiday but when that day falls on a Sunday, that day and the following Monday will be public holidays and bank holidays. 10 It is important to note, at this stage, that the Holidays Act does not govern what are public holidays under the Agreement. The Agreement does that itself. Anzac Day is a public holiday by virtue of cl 48.5.1 and so it was on Sunday 25 April 2010. Monday 26 April 2010 was a public holiday by virtue of cl 48.5.4 of the Agreement. 11 The intention of the Agreement when providing for a public holiday on 26 April 2010 was to allow employees who would not ordinarily be required to work on Sunday 25 April 2010 to have the benefit of a public holiday on 26 April 2010 which otherwise would have been denied to them. It could not have been the intention of the parties to the Agreement to allow employees who were expected to perform their ordinary duties on Sunday 25 April 2010 to have that day as a public holiday as well as the following day, Monday 26 April 2010. "Double dipping" in respect of public holidays in that way would not have been within the reasonable expectation of the parties to the Agreement or the arbitral body which certified it. The treatment of both 25 and 26 April 2010 as public holidays for a person who worked on both days as part of that person's ordinary duties would mean, in effect, that such a person received two Anzac Day holidays. Such an absurd result would not have been in the reasonable contemplation of the parties to the Agreement. 12 The above analysis is supported by the extract from the Anzac Day Holiday Test Case (2004) 134 IR 270 in the Australian Industrial Relations Commission recorded at paragraph [31] of the judgment of the primary judge, especially the final paragraph of the extract which eschewed the concept of "double counting". 13 SDA contends that a literal interpretation provides that both 25 and 26 April 2010 were public holidays. So much cannot be denied. A person who did not ordinarily work on 25 April 2010 was entitled to a public holiday on 26 April 2010, if that person ordinarily worked on that later day. A person who ordinarily worked on 25 April 2010 but not 26 April 2010 was entitled to a public holiday on 25 April 2010. That is why both days were public holidays. To that extent a literal interpretation is one that is consistent with the intention of the makers of the Agreement. However, a literal interpretation that is at odds with the intention of the makers of the Agreement is one where a person who ordinarily worked both days gets public holiday rates for both, in effect two Anzac Days. 14 Support for the position that the industrial context and the intention or purpose of the makers of an industrial instrument should be paramount notwithstanding the strict wording of the document is found in the judgments of members of the High Court in Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241. 15 In Amcor, Gleeson CJ and Mc Hugh J stressed at paragraph [2] that: (t)he resolution of the issue turns upon the language of the particular agreement, understood in the light of its industrial context and purpose, and the nature of the particular reorganisation. (Emphasis added.) See also at paragraph [13], where their Honours referred to: …the industrial purpose of the agreement, and the commercial and legislative context in which it applies. 16 Further, the purposive approach to the construction of industrial instruments was persuasively illustrated by Kirby J in Amcor at paragraph [96] where his Honour said: The nature of the document, the manner of its expression, the context in which it operated and the industrial purpose it served combine to suggest that the construction to be given to cl 55.1.1 should not be a strict one but one that contributes to a sensible industrial outcome such as should be attributed to the parties who negotiated and executed the Agreement. Approaching the interpretation of the clause in that way accords with the proper way, adopted by this Court, of interpreting industrial instruments and especially certified agreements. I agree with the following passage in the reasons of Madgwick J in Kucks v CSR Ltd, where his Honour observed: It is trite that narrow or pedantic approaches to the interpretation of an award are misplaced. The search is for the meaning intended by the framer(s) of the document, bearing in mind that such framer(s) were likely of a practical bent of mind: they may well have been more concerned with expressing an intention in ways likely to have been understood in the context of the relevant industry and industrial relations environment than with legal niceties or jargon. Thus, for example, it is justifiable to read the award to give effect to its evident purposes, having regard to such context, despite mere inconsistencies or infelicities of expression which might tend to some other reading. And meanings which avoid inconvenience or injustice may reasonably be strained for. For reasons such as these, expressions which have been held in the case of other instruments to have been used to mean particular things may sensibly and properly be held to mean something else in the document at hand. (Original emphasis.) See also per Gummow, Hayne and Heydon JJ at [30]. 17 The approach of the High Court in Amcor is consistent with the modern approach to interpretation of commercial agreements where context and surrounding circumstances will be taken into account "even if the words at issue are not ambiguous, or susceptible of more than one meaning"; see Lion Nathan Australia Pty Ltd v Coopers Brewery Ltd (2006) 156 FCR 1 at paragraph [46], per Weinberg J and see also at paragraph [251] where Lander J said: It is now clear and settled law that the meaning of commercial contracts and documents is to be determined objectively. To determine the objective intention of the parties regard must be had, of course, to the words in the document themselves, but regard should also be had to all of the surrounding circumstances which were known to the contracting parties at the time the document was created including the underlying purpose and object of the commercial transaction: Pacific Carriers per Gleeson CJ, Gummow, Hayne, Callinan and Heydon JJ at [22]. 18 What is true of commercial contracts and their construction is also true of the construction of industrial agreements where regard must be had to the industrial context and the purpose of the provisions in question. In that regard, see also Short v FW Hercus Pty Ltd (1993) 40 FCR 511, especially at 518 to 520 per Burchett J, and City of Wanneroo v Holmes (1989) 30 IR 362 at 378 per French J. The issue currently in contest between the parties may fairly be resolved by asking the following question: given the purpose of public holiday provisions and the purpose of creating additional public holidays, could it be reasonably intended by industrial parties to an industrial instrument that a person would be entitled to the benefit of a public holiday for Anzac Day and on the very next day the provision of another public holiday for Anzac Day? The answer is obvious and must be no. 19 Accordingly, the primary judge was correct to dismiss the SDA's application for a declaration of entitlement for Ms Clifford to a public holiday rates for work performed on 25 April 2010 in addition to her payment, at public holiday rates, for work performed on 26 April 2010. The appeal must be dismissed. I certify that the preceding nineteen (19) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Marshall, Tracey and Flick.