Spalding v Can't Tear 'Em Pty Ltd

Federal Court of Australia|1999-09-03|Before: Kiefel J, Marshall J, Dowsett JJ, Wilcox J

REASONS FOR JUDGMENT WILCOX J: 1 I have had the advantage of reading in draft form the reasons for judgment of Marshall J. I agree with his Honour that the appeal should be upheld, although I reach that conclusion by a somewhat different route. 2 The appellant's claim for severance payments and sick leave entitlements is based on the certified agreement known as Yakka Pty Ltd Redundancy Agreement December 1994. By cl 5 of that agreement, it is binding upon the respondent "and its employees employed pursuant to the terms and conditions of the Clothing Trades Award 1982 throughout Australia". So the appellant is entitled to the benefits available under the certified agreement if, but only if, she was, prior to her termination, employed pursuant to the terms and conditions of the award. 3 Clause 5 of the award dealt with its incidence. The clause commenced as follows: "(a) This award shall be binding upon the employers named in the Schedules 'A' and 'B' hereto and upon the members of the organisations of employers named in Schedule 'C' hereto in respect of each and every person employed by them in the clothing industry whether members of The Clothing and Allied Trades Union of Australia or not and upon the said union and members thereof." The respondent was named in Schedule A. There was a proviso to para (c) that is not presently relevant. The clause also contained paras (b) and (c). They also are irrelevant. 4 It will be noted that cl 5(a) spoke of "each and every person employed by them in the clothing industry". Also I accept there may be people employed by a clothing manufacturer who are not "employed … in the clothing industry" within the meaning of cl 5(a). Examples offered in argument were a truck driver or lift mechanic. However, throughout the whole of her employment with the respondent, the appellant was involved in the production of clothing; apparently always shirts. She was first engaged in training people in shirt making, then a production manager, in relation to shirts, and finally a product (shirts) development manager. On any interpretation of the term "clothing industry", the appellant was employed by the respondent in that industry. 5 The description of employees in cl 5(a) is extremely broad: "each and every person employed by them in the clothing industry". Provided the employee is employed in the clothing industry, he or she is prima facie covered by the award. There may be express exceptions, as for example in cl 6, which indicates that people involved in the manufacture of knitted piece goods and the making up of clothing therefrom are subject to the Textile Industry Award. However, unless an employee is the subject of a clear exclusion, like this, the employee is covered by the award. It is not enough that it may be difficult to determine what award entitlements the particular employee might have engaged. 6 The respondent argues the appellant was excluded from the operation of the award. It is not able to point to any relevant words of exclusion; its argument is that, when one looks at the pay rates prescribed by the award, it is not possible to fit the appellant into them. This was the argument that found favour with both the magistrate and primary judge. The basis of the argument is that cl 7 of the award, which sets out rates of pay, contains a series of classifications of employee, none of which aptly describes the position of the appellant at the date of her termination. 7 As will be apparent, I have concerns about this whole approach. I do not think that a difficulty in accommodating the appellant to the cl 7 pay scale is a sufficient reason for reading down the clear words of cl 5(a). However, even accepting the approach, I do not think it is clear that the pay rates fail to cover the appellant. In saying that, I do not find it necessary to reach a conclusion about the application of cl 7 to the appellant. Although cl 7 remains in the award, the classifications and pay rates it contains have been superseded by the insertion into the award of cll 7A and 7B. 8 Clauses 7A and 7B were inserted into the award in 1993; no doubt as part of the widespread movement at that time from classification of employees in terms of a particular calling into a classification based on skills. The idea was that employees should be encouraged and assisted to broaden their range of skills and thereby be able to undertake a wider variety of duties. Consistently with this notion, the number of separate classifications was to be reduced. 9 Clause 7A(a) sets out a table showing a minimum weekly wage rate, in ascending order, for each of six classifications of employee: trainee, skill level 1, skill level 2, skill level 3, skill level 4 and skill level 5. Paragraph (a) goes on to describe what is expected of employees at each of skill levels 1, 2, 3 and 4. It does not specify the skills requirements of employees at skill level 5. As the pay rate for skill level 5 is higher than that for skill level 4, those requirements were obviously intended to be more demanding than for skill level 4. 10 I need not set out the lengthy statement of requirements for skill level 4 employees. They fall short of what would be necessary for a position as a production manager or production development manager, but not by much. It is logical to regard the skills level needed by the appellant in those positions as being immediately above skills level 4. 11 In the course of argument, counsel for the respondent suggested the reason why the award did not include a description of the skills necessary at skill level 5 was that it was realised nobody would fall into that category. I do not agree. There would plainly be a need, in a substantial clothing manufacturing business, for some employees who had skills superior to those required for level 4, yet below those needed at senior executive level. The more probable explanation, it seems to me, for the non-specification of level 5 skills is that considerable variety might be expected at that high level, in relation to the needs of individual businesses. It might have been thought specification would create problems for those employers whose businesses had a "different fit". 12 Be that as it may, at the date of the termination of the appellant's employment, the award provided a broadband classification called skill level 5 into which the appellant would have naturally fallen. 13 Class 7B of the award provided for a transition period, between the use of the old (calling) classification system and the new skills based classification system. The transition period was defined as extending from 1 May 1993 to 1 March 1994. Employees were to be paid at cl 7 rates from the beginning of that period until 1 November 1993 and thereafter at cl 7A rates. In the meantime there was to be a translation of employees by a procedure set out in Schedule G to the award. This Schedule detailed requirements for notifying employees of the prospective change in classification and training them in new skills. The schedule also set out requirements for seven skill levels. The purpose of this prescription is unclear. It does not appear to have had any function in terms of fixing pay rates or other conditions of employment. There was nothing in Schedule G that indicates it was drafted with the clothing industry in mind; it might have been a common form document inserted in many awards at that time. Whether or not this is so, there is no correlation between the description of skills at a particular level in Schedule G and the description at the same level in cl 7A. Schedule G was concerned only with the translation procedure. It contained nothing to indicate it was intended to have any effect after the end of the transition period. Contrary to the submission of counsel for the respondent, I do not think the existence of Schedule G derogates from my conclusion that the appellant fell within skills level 5 in cl 7A at the time of termination of her employment. 14 Although it appears some reference was made to cl 7A during the hearings before the magistrate and primary judge, this clause was not put at the forefront of argument. Perhaps for that reason, neither the magistrate nor the primary judge considered its significance. Had they done so, they may have reached a different view about the proper outcome of the case. 15 Once it is accepted that the award applied to the appellant, it follows from cl 5 of the certified agreement that she is entitled to the benefits it provides. Those benefits must be calculated in accordance with the certified agreement. Presumably, the parties will agree on the appropriate amount. 16 I agree with the orders proposed by Marshall J.

I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Wilcox.

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

17 This is an appeal from the judgment of a judge of this Court ("the primary judge") given on 14 April 1999. The matter before the primary judge was an appeal by the appellant, Angelita Spalding, from the judgment of an Industrial Magistrate in an application brought pursuant to s179 of the Workplace Relations Act 1996 (Cth) ("the WR Act") for the payment of benefits allegedly owing under a certified agreement.

18 Ms Spalding was first employed by the respondent company, Can't Tear 'Em Pty Ltd ("the Company"), in November 1988. When she was made redundant on 2 July 1997, she occupied the position of product development manager.

19 At the time of the termination of Ms Spalding's employment the Company was a respondent to the Yakka Pty Ltd Redundancy Agreement December 1994 ("the Certified Agreement"). This agreement had been certified by the Australian Industrial Relations Commission pursuant to what was then s 170MC of the Industrial Relations Act 1988. The operation of the certified agreement was preserved by Sch 8 to the Workplace Relations and Other Legislation Amendment Act 1996, as was explained by Moore J in Construction Forestry Mining and Energy Union v Mount Thorley Operations (1997) 79 FCR 96 at 102-104. 20 The Certified Agreement contained a "parties bound" clause which identified, inter alia, the following persons as being bound by its terms: · the company · the Textile Clothing and Footwear Union of Australia ("the Union") and · "each and every person employed by the company pursuant to the terms of the Clothing Trades Award 1982 …." 21 Clause 5 of the Certified Agreement provided in its opening paragraph as follows: "This agreement shall be binding upon the company and its employees employed pursuant to the terms and conditions of the Clothing Trades Award 1982 throughout Australia."

22 Clause 14 of the Certified Agreement provided for the payment to employees of severance payments of three weeks pay for each year of service for employees with more than 1 years' service. 23 Clause 16 of the Certified Agreement provided for the receipt by employees of "all untaken sick leave entitlements" on redundancy occurring. 24 The Clothing Trades Award 1982 ("the Award") applied to persons employed by respondents to the Award "in the clothing industry". 25 Upon the termination of her employment, Ms Spalding did not receive severance pay or unused sick leave as provided by cll 14 and 16 of the Certified Agreement. The Company's position was that the Certified Agreement did not apply to Ms Spalding, notwithstanding that she was employed in the clothing industry, because the Award failed to prescribe a wage rate for persons in supervisory or managerial positions. Accordingly, the Company argued, the Award had no application to such persons and, in turn, the Certified Agreement had no application. The Industrial Magistrate accepted that contention. In his reasons for decision the magistrate said: "The defendant says it would be absurd to apply the award to each and every person employed in the clothing industry, that is to include persons such as clerical staff, managers, fitters et cetera where there is no pay rate applicable to the type of work that those particular people might do. I find that I agree with this submission."

26 The primary judge took a similar approach. 27 In my opinion both the Industrial Magistrate and the primary judge fell into error. On its face, the Award applies to all persons engaged in the clothing industry. It is common ground that Ms Spalding was so engaged. Rates of pay were provided in the Award at the material time for persons who performed work "in connection with" the making of shirts. See Group H in cl 7 of the Award. Classification no 119 listed in that group was, "All others not herein classified". A relatively low rate of pay was assigned to that classification. 28 The effect of the existence of an "all others classification" in the context of an industry-wide award is that it embraces all persons employed in the industry, including those who do not otherwise fit within a named classification. The "all others classification" attracts a relatively low rate of pay under the Award, but there was, of course, nothing to stop an employer paying an over award component to increase that rate. That is what the Company chose to do in offering Ms Spalding a higher rate of pay from that to which she would have been entitled under the Award. 29 The consequence of the above analysis is that the primary judge erred in holding that Ms Spalding had no entitlement to the benefit of the Award, and therefore, the Certified Agreement. Once Ms Spalding is accepted as being entitled to the benefit of the Award the Certified Agreement operates upon her employment. 30 This approach to the question before the Court is consistent with what limited authority there is in this area of federal industrial jurisprudence. 31 In De Havilland Aircraft Pty Ltd v Boyd (1948) 61 CAR 735 a Full Court of the Commonwealth Court of Conciliation and Arbitration held that a detailing draughtsman was covered by the Aircraft Industry Award notwithstanding that there was no classification in that award that related to the worker's employment. 32 Kelly J said (at 737): "Reading the Aircraft Industry award in accordance with this principle it covered the work of any employee of the company "employed in any capacity whatsoever in or in connexion with or incidental to the industry or industries of manufacturing, assembling, repairing or maintaining aircraft or parts thereof". It thus covered the work of the employee Baird. It dealt with the matter of the obligation of the Company towards him in respect of the minimum rate of wages to be paid, for although his work is not described in any of the specific classifications included in sub-clause (a) of clause 3 it certainly falls within the "classification" of "all others"."

33 Foster and Kirby JJ, in separate reasons for judgment, agreed with the conclusion of Kelly J. 34 Boyd was applied in Re Graphic Arts Award 1948 (1952) 75 CAR 138 where there was no specific classification in the relevant award for lift drivers. Foster J, with whom Dunphy and McIntyre JJ agreed, after referring to Boyd and an earlier case said (at 140): "In my view, since the lift drivers in this case were part of the industry, though without a classification, the reasoning in both these cases is such as to compel me to the conclusion that a rate of wages has been prescribed by this award for "all others" including this particular class of workers. Some confirmation of that view comes to mind when one looks at it from the other angle: suppose J. Fielding and Co. Ltd. was prosecuted for failure to pay to the lift drivers either the prescribed rate for "any other adult employee" or for failure to afford some prescribed conditions, could they hope to succeed by saying - "these persons are not covered by the award although they worked in the industry, are part of the industry, and a rate for 'all others' is prescribed".

35 See also O'Toole v Fairey Aviation Co of Australasia Pty Ltd (1953) 78 CAR 143. 36 In Re Rubber Plastic & Cable Making Industry Award (1963) 8 FLR 395, the Commonwealth Industrial Court accepted an interpretation of the relevant award which had been contended for by Dunlop Rubber Australia Ltd. 37 The Court said that (at 396): "The contention of the applicant company was that certain cleaners employed by the applicant at its rubber factories in the cleaning of lavatories, changing rooms, dining rooms and the like were covered by the relevant "all others" classifications in clauses 9 and 9A of the award."

38 The award applied to all persons (with certain immaterial exceptions) who were engaged in or in connection with the manufacture of rubber. The employees in question were cleaners in rubber factories. The Court held that the award incidence clause applied to them on the basis that their work was "in connection with" or "incidental to" the manufacture of rubber goods. 39 Further in Cutmore v Bianchin (1974) 22 FLR 127 the Australian Industrial Court held that a youth who was employed to perform the functions of a general butcher and who did not fall within any classification in the relevant award was entitled to be paid at the adult rate applicable to "all others". Clause 13(b)(ii) of that award had the effect that if an employer failed to lodge the required indenture for apprenticeship the apprentice shall be paid the appropriate adult rate prescribed by the award by reference to "general butcher" and "all others". 40 After March 1994 a new clause cl 7A was introduced into the Award which had the effect of establishing a broad banded 5 level classification structure. That broad banded structure did not supplant the classifications contained in cl 7 of the Award but provided a path for wage increases in circumstances where individual employees came within any of the various skill levels set out in the 5 band structure. 41 To answer the question whether Ms Spalding was covered by the Award it remains legitimate to examine the provisions of cl 7 to ascertain if the Award applies. To the extent that cl 7A is relevant it contemplates that employees entitled to wages at the highest band level would be employees engaged in the most responsible positions in the industry including supervisory ones. An employee is nonetheless an employee even if employed in a managerial role. Any contention to the contrary is not supported by authority and denies the reality of the existence of a contract of employment. 42 The most appropriate course is for the matter to be remitted to the trial judge for her to receive submissions on the quantum of the entitlements owing to Ms Spalding for unused sick leave and redundancy pay in accordance with these reasons. 43 I would order as follows: 1. The appeal be upheld.

The matter be remitted to the trial judge for the purpose of calculation of the relevant entitlements of the appellant in accordance with these reasons. I certify that the preceding twenty-seven (27) numbered paragraphs (17 to 43) are a true copy of the Reasons for Judgment herein of the Honourable Justice Marshall.

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

DOWSETT J: 44 I have had the opportunity of reading the separate reasons prepared by Wilcox J and Marshall J in this matter. Unfortunately I find myself in disagreement with the orders proposed and with their Honours' reasons. I am, however, able to adopt those parts of the judgment prepared by Marshall J which set out the nature of the present application. 45 To resolve this matter, it is necessary to identify two factual matters, namely:- · The nature of the duties undertaken by the appellant in the course of her employment with the respondent; and · The nature of the business conducted by the respondent. 46 At first instance, the magistrate found that the appellant was employed in a managerial role, firstly as Factory Manager and then as Product Development Manager. As to the employer's business, the only finding was that the respondent did not manufacture trousers as had Carters, a company which previously employed the appellant. These rather sparse findings of fact necessitate my having regard to the evidence which appears to have been generally undisputed. In her curriculum vitae, the appellant described her duties as Product Development Manager (a position which she occupied from 1993 until her termination on 2 July 1997) as:- Responsibilities included effective management of the introduction of all new products and the change in any existing products. Other duties included planning and directing the manufacturing operation, including financial management, scheduling of product, production maintenance, quality control, compensation, rehabilitation and safety. In addition, I organised and managed General Sewing Data. Assembly instructions and specifications to ensure cost effective and quality assured production. In carrying out this role, I was selected to introduce all new products, eg Just In Time 47 She described her achievements in this role as including:- · Designed and implemented a quality control system by introducing specifications which were non existent, therefore eliminating waste. · Increased productivity and reduced costs by motivating and training staff to work according to the General Sewing Data system. · Created and maintained a team environment by introducing a sense of ownership and belonging. · Introduced 'Just In Time' systems in a stand up line to perform at 110% unsupervised. · Maintained good customer relationships with outside contracts, always meeting deadlines. · Co-ordinated a number of team building seminars successfully for both managers and staff in both Melbourne and Brisbane. 48 She also provided the following particulars as to her responsibilities as Factory Manager between 1988 and 1993:- Duties: My responsibilities included supervision of 90 machinists and three supervisors. I did all the hiring and firing and training. Other duties, were purchase of all trims, maintaining budget, production scheduling, liaison with contractors and clients and quality auditing in-house. Achievements in this role include:- Initiated and planned the first manufacturing plant for Can't Team 'Em to be productive within the first three months. Successfully improved methods to reduce compensation and increase productivity. Maintained control of all procedures in our Quality Manual to ensure continual accreditation. Maintained a happy staff environment to control staff turnover. Successfully met all deadlines in a good quality standard. Ensured all required trims were readily available at all times to avoid any loss in production. 49 The respondent's job descriptions for these positions were also in evidence. The Product Development Manager worked under the supervision of the Operations Manager and, when requested, was to deputise for that person in all manufacturing areas. Her duties included:- · Develop and maintain GSD (General Sewing Data) time studies for all garments. · Develop and maintain Shirt Specification on all shirts. · Process all requests for New Style form NSR to final pattern - GSD, Costing and completed Samples through to Production, ensuring all steps are completed within timeframe requested. · Provide complete technical specifications on all products (including fit and tolerance, garment constructions, packaging and presentation) to the requirements of contracts and special customer orders. · Ensure production samples are available and current prior to the production of any customer orders. · Develop production specifications for all garments with due regard to ease of construction by factory personnel and achievement of customer specifications. · Liaise with Operations Manager, Factory Manager, or Cutting Supervisor and Mechanics to achieve Quality Improvements in garments design, construction, equipment utilisation and work methods. · Liaise with Quality Assurance Manager on potential or identified quality problems and take appropriate steps, following up to ensure that action has in fact averted or solved the problem. · Regularly appraise production methods and machinery availability to ensure efficiency is maximised. · Develop and maintain method analyses to include inspection points and all quality requirements for use in operator training. 50 At the time that the appellant was appointed to the position, the incumbent was expected to have practical experience in a wide range of sewing operations associated with complete garment construction, with at least two years' experience at a supervisory level. The incumbent was also to have personnel management skills and should have completed courses related to the clothing industry, including:- · Train the Trainers course; and · Basic Sewing Mechanics course. 51 It was also desirable that the incumbent hold a "GSD Certificate". "GSD" is the abbreviated form of General Sewing Data. The actual meaning of this expression is unclear. 52 The duty statement for the appellant's position as Factory Manager provided that she should:- · Direct the factory to achieve budgets in respect of volumes, costs and overhead expenses. · Control productivity by constantly monitoring labour performance. · Implement and maintain Quality System and ensure that all work is carried out in conformance with Australian Standard AS3902. · Regularly appraise production methods and machinery availability to ensure efficiency is maximised. · Ensure adequate supervision of all activities within the factory. · Hire and fire staff, where and when necessary. · Ensure all factory personnel are adequately trained in both Quality requirements and multi-skilling to meet demands upon the factory. · Control receipt, storage and issue of all raw materials and accessories, including the relevant procedures and product specifications. · Ensure adequate maintenance by mechanics of plant and equipment. · Liaise with Quality Officer on potential for identified quality problems and take appropriate steps, following up to ensure action has in fact averted or solved the problem. · Facilitate the commitment and effort of all factory employees toward on-going quality and productivity improvement. · Provide complete technical specifications on all products (including, fit and tolerance, garment construction, packaging and presentation) to the requirements of contracts and special customer orders. · Develop production specifications on all garments with due regard to ease of construction by factory personnel and achievement of customer specifications. · Develop and maintain method analyses to include inspection points and all quality requirements for use in operator training. · Ensure production samples are available and current prior to the production of any customer order. · Liaise with Operations Manager and Factory Supervisors to achieve Quality Improvements in garment design and construction, equipment utilisation, and work methods. · Identify and implement strategies for improved resource utilisation on all products. · To release conforming product from the factory to warehouse. · To develop, approve, authorise, maintain and revise specifications, checklists, records and forms. · Apply solutions where quality problems occur and ensure corrective action is taken. · Ensure that at all times proper housekeeping practices are adopted and applied and that the workplace conforms with all minimum standards required by regulation. · Develop and maintain employee moral (sic) and motivation levels. · Develop and maintain GSD time studies for all garments. · Develop and maintain shirt specification sheets on all shirts. 53 These duties appear to include many of those subsequently undertaken by the Product Development Manager. It seems that when the appellant was appointed to the latter position, she undertook part of the work previously performed by her as Factory Manager whilst another person undertook the balance. 54 The appellant was first employed by the respondent to train staff who were hired to make shirts. Subsequently, she was employed in supervisory roles. She received four weeks' annual leave, sick leave, and a travelling allowance. She was not required to "clock on" or "clock off", and was paid overtime. During cross-examination, she said that she was initially retained to perform planning duties and then became a supervisor. I am not entirely sure if this is consistent with her earlier evidence as to her training role, but it probably does not matter much. She described her supervisory functions as:- "keeping the factory floor in work and keeping the flow running." Her salary was reviewed annually on the basis of an annual assessment of her performance. She said that she became Factory Manager after about two years with the respondent. She was asked:- "Now, did anything significantly change in your job after two years? She replied:- "Other than having more supervisors under me and more staff." 55 She was responsible for engaging and dismissing employees. The appellant was responsible to a Mr Bill Moore. 56 Mr Winlaw was the Queensland General Manager of the respondent in the 1980s and early 1990s. He said that when the respondent engaged the appellant, it had not previously been engaged in manufacturing clothing, but had been a distributor of items made under contract. For this reason, the appellant was employed as "someone to run the factory - to get it up and running - up to speed as quickly as possible". It appears that the respondent acquired assets from Carters, a company for whom the appellant had been working and heard of her and her ability in the course of that acquisition. Immediately after her appointment, the appellant spent some time being trained in shirt production. Her previous experience had been in the manufacture of trousers. Mr Winlaw said that this was "an induction process", as the factory was to manufacture shirts. 57 Mr Cuffell is the current Queensland General Manager of the respondent. He became Managing Director in March 1989. From that time the appellant was part of the "management team". He was asked about the structure "below Mrs Spalding" and said that there were line supervisors. The factory was divided into various "lines", including "polycotton" and "drill". In 1992 the respondent merged with a Melbourne company called Jones Workwear. The Jones product mix was different from that previously undertaken by the respondent, including a large number of different types of shirt. The appellant was thereafter involved in providing "stays and specifications and that sort of information" about the new products. This seems to have involved her working at more than one factory or other workplace. 58 After she became Product Development Manager:- Rather than have a hundred machinists or factory people under her, she had the authority - not so much over the factory, but to introduce the new products into the line for trial and measuring and time studies, etc, as well as overseeing the cutting room and - they weren't as efficient as we would have liked and Angie - to pull that team together and get up to the efficiencies we expected. 59 The appellant became redundant when the respondent ceased developing a substantial flow of new products. Mr Cuffell considered that she had been in charge of the whole factory. As to her responsibility for engaging and dismissing staff, he said that she was actively involved in the process but may not have had ultimate authority in this respect. 60 Finally, evidence was given by William Harry Moore who was the Operations Manager of the respondent. He said that initially, the appellant's duties as Factory Manager were to engage and dismiss "all staff on the floor, to run the floor on a day-to-day basis and to evaluate in time studies any new construction that was required". He said that in 1995, the respondent increased staff levels and started many new designs and styles. At this stage, the Factory Manager's job was split into two with the appellant becoming Product Development Manager. Her duties included updating all time studies, re-evaluating methods and expanding "our administrative role". She was also responsible for building up morale at the Moorooka plant and developing specifications for the various styles of shirt. When she was Factory Manager, the appellant was supervising about 80 employees and was responsible for engaging and dismissing staff. The Factory Manager retained that responsibility after the appellant became Product Development Manager. In cross-examination Mr Moore said that if the appellant were to hire staff, she would have to go through "a justification procedure of why she'd hired". Similarly "If it was firing, the same would apply, she would put forward the case of why it had to happen and as long as it had gone through the warning procedures, then the firing would go ahead." He said that she might demonstrate a machine function to an operator in connection with a new product. 61 From this summary of the evidence it appears that the respondent was engaged primarily, or even exclusively in shirt-making and that the appellant's duties were of a managerial kind, initially involving a substantial degree of supervision, and subsequently, product development. She was not a low level supervisor, but rather a "middle manager". 62 The present question is whether or not the respondent was bound to observe the Yakka Pty Ltd Redundancy Agreement dated December 1994 in connection with the appellant's dismissal on 2 July 1997. It is common ground that it was so bound if, at the relevant time, it was bound by the terms of the Clothing Trades Award 1982 in so far as concerns its contract of employment with the appellant. 63 Paragraph 5(a) of that award provides:- This award shall be binding upon the employers named in the Schedules "A" and "B" hereto, and upon the members of the organisations of employers named in Schedule "C" hereto, in respect of each and every person employed by them in the clothing industry whether members of the Clothing and Allied Trades Union of Australia or not, and upon the said union and the members thereof." 64 The word "employed" might well encompass the appellant's relationship with the respondent, but there is a more limited sense in which the word may be used. The Oxford English Dictionary (2nd ed) Vol V suggests that it may also describe "the wage-earning class", giving the example "Attachment to the class of the employed, rather than of the employers." The term "wage" may describe a payment for services to any employee, but there is also a more restricted meaning which is found in the Shorter Oxford Dictionary Vol 2, namely "a fixed regular payment, usually daily or weekly, by an employer to an unskilled or manual worker", to be compared to the use of the word "salary" which is defined as "payment made for professional or non-manual work". 65 One hears frequently during industrial disputes of the stance taken by "management", which appears generally to mean the stance taken by managerial staff who, one would infer, are probably, themselves, employees. Their stance is, of course, taken on behalf of the employer. No doubt, in the course of industrial disputes, there is a need to distinguish between those who are demanding improvements in their conditions and those who are responding on behalf of the employer. It is, I believe, a matter of course in industrial undertakings to distinguish between wage earners, or employees on the one hand and "staff", or "salaried staff" on the other. Of course, from a legal point of view, all of these people are employees. My point is simply that in some contexts the word "employee" may have a narrower meaning which excludes "managerial" or "salaried" employees. The word "employed" may possibly also have this variation in meaning. The respondent submits that the word is used in that narrower sense in the present context. 66 The proviso to par 5(a) of the award demonstrates that it was not intended to have as wide a meaning as appears at first reading. The proviso excludes employees of the Government Clothing Factory Branch of the Government Stores Department of New South Wales. Clause 6 also excludes certain persons who would otherwise have been included within the ambit of operation of par 5(a). However these exclusions are express. It is the respondent's submission that on the proper reading of the award as a whole, there are other compelling reasons for giving the expression "employed by them in the clothing industry" a narrower meaning than might otherwise appear to be appropriate. 67 The award prescribed various conditions of employment and in particular, cl 7 prescribed rates of pay for what appears to have been an exhaustive list of relevant employees. Paragraph 7(a) provides:- The rates of pay in this Award have been broad-banded as an interim step towards the introduction of a new skills based classification structure. 68 The words The rates of pay in this Award suggest that all rates payable pursuant to the award were to be found in what followed. This implies that any person for whom there was no appropriate pay rate was not a person employed in the clothing industry for the purposes of par 5(a). This conclusion is supported by the provisions of par 7(e) which provided for increased payments in certain circumstances. Those provisions assumed that all relevant employees would have pay entitlements pursuant to pars 7(a) and (b). Sub-paragraph 7(b)(i) created "Wage Bands" 1A, 1B, 2A, 2B, 3A, 3B, 4 and 5. Sub-paragraph 7(b)(ii) identified various classifications of work in thirteen "Groups" as follows:- · Group A - Order Tailoring for Males; · Group B - Order Tailoring for Females; · Group C - Readymade Clothing for Males; · Group D - Order Dressmaking; · Group E - Readymade Dressmaking and Readymade Tailoring for Females; · Group F - Underclothing; · Group G - Whitework; · Group H - Collars, Shirts, Ties, Scarves and Pyjamas; · Group I - Industrial Clothing; · Group J - Headwear; · Group K - Umbrellas; · Group L - Fur trading; and · Group M - Artificial Flowers and Brushed Silk Emblems. 69 Because the respondent was primarily engaged in shirt manufacture, this case has focused upon Group H. It provided that:- The weekly wage for every description of work done in connection with the making, and/or altering, and/or repairing, and/or adorning, and or work incidental thereto of collars, ties, scarves, cuffs, shirts, shirt fronts, pyjamas for males, singlets or underpants (except knitted goods) shall be as follows: 110 Cutter, marking in and/or cutting out. 4 111 Die cutter in cutting room. 4 112 Head of a table or bench of machines, in charge of four or more persons above machinist rate. $8.45 113 Machinist and or table-hand and or adornment worker. 2A 114 Presser and or ironer operating Hoffman type press or hand iron more than 3.63 kgs (8 lbs) in weight (not counter-balanced). 3A 115 Presser and or ironer - other. 2A 116 Fuser. 2A 117 Examiner examining for faults in construction. 2A 118 Transport operator, ie employee operating console. 2A 119 All others not herein classified. 1A 70 The right-hand column gives the relevant Wage Band number, with the exception of item 112, which provides for an additional cash payment. This appears to be a loading for responsibility as head of table or bench. As I understand it, the appellant does not suggest that she would have fallen into any of these categories with the possible exception of "All others not herein classified", which was placed in Wage Band 1A, the lowest-paid band. There were no positions in the Group falling within Wage Band 5, it being apparently reserved for the most highly skilled employees in the industry, specifically cutters in Groups A, B, D and L. 71 The category "All others not herein classified" was inappropriate for the appellant. It seems most unlikely that a highly skilled and experienced supervisor was to be so classified. In any event, she could only fit within that description if she could be accurately described as performing "… work done in connection with the making and/or altering, and/or repairing, and/or adorning, and/or work incidental thereto of … shirts". In one sense, she was so working, but when one considers the other categories of employee in this Group, one sees that they were all performing physical work (with varying degrees of skill) in connection with the making of shirts. To the extent that the appellant was involved in the manufacture of shirts, she was performing at a supervisory level or in developing systems for the manufacture of new products. She was not, in any relevant sense, employed to manufacture shirts by use of physical skills. For this reason, and because it seems quite unlikely that a supervisor would be placed in the lowest of all Wage Bands, I conclude that reading cl 5 with cl 7, a person performing the functions performed by the appellant was not a person employed in the clothing industry whilst the cl 7 wage structure was in operation. 72 With regard to the cases cited by Marshall J, I point out, with all respect to his Honour, that they appear to have involved employees whose duties were such that they could appropriately be included in "all others" clauses in the relevant awards. 73 From the early 1990s, although cl 7 remained in the award, it operated in conjunction with cl 7A. In order to understand cl 7A it is necessary to understand certain changes effected in the industry wage structure. As I have already demonstrated, that structure was previously based on a system of Wage Bands, with 1A at the bottom and 5 at the top. Clause 7A provided instead for four "classification skill levels" and provided criteria for inclusion in each. The appellant submits that some of these criteria reflected elements of supervision. It is true that there were references to co‑ordination, quality control and instruction, but it is quite clear that the criteria for each of these skill levels described a person employed in physical labour. The appellant's job description would not have fitted fairly into the criteria for any of the four skill levels. 74 There was no skill level 5 although the table of skill levels showed a classification bearing the number 5. The footnote made it clear that this was a "Wage Band", apparently a reference to the structure prescribed by cl 7. Thus cl 7A prescribed four skill levels and also retained Wage Band 5. It prescribed no criteria for entry to Wage Band 5. This raises questions as to its intended use. Some light is thrown upon this by reference to Schedule G to the award which prescribed "Translation Procedures", apparently for the transition from the "old" wage structure (cl 7) to the "new" (cl 7A). The Schedule appears to have been prepared for purposes beyond those of the present award because it identified seven skill levels rather than four. The criteria identified for skill levels 1 - 4 were, however, similar to, although not identical with those prescribed in cl 7A. 75 Schedule G prescribed the process for identifying the appropriate skill level for each employee. Step 5 of that process provided for a committee to perform this task. Each worker was to be allocated a minimum skill level by reference to his or her current Wage Band. A table established comparability between Wage Bands and skill levels. The committee was then to consider whether the worker's demonstrated skills justified a higher skill level. Allocation to a higher skill level was dependent upon the employee meeting the criteria prescribed for that higher level. It follows that nobody could have been assigned to a skill level higher than skill level 4 as a result of this process because no criteria were prescribed for any higher level. However the table to which I have referred showed that persons previously in Wage Band 5 were to remain there. To my mind, this indicates clearly that the only persons who were to be assigned to Wage Band 5 were those who were already in that Wage Band pursuant to cl 7. As I have noted previously, those in Wage Band 5 appear to have been the most highly skilled workers. There may have been any number of reasons for continuing the old Wage Band structure to accommodate them. They undoubtedly would have enjoyed higher status within the operation which they would have been reluctant to forego. There may have been peculiar difficulties in dealing with them, leading to a decision to do so at a later stage. Perhaps Wage Band 5 was to be phased out and not replaced by an equivalent skill level. For whatever reason, it is quite clear that the only persons to be included in Wage Band 5 pursuant to cl 7A were those so included pursuant to cl 7. 76 As with cl 7, cl 7A seems to have been designed to list exhaustively all persons subject to the award. As the appellant did not sensibly fit into the criteria for any of the skill levels, and as she could not be placed in Wage Band 5, it seems that the award was not intended to apply to her employment. 77 It would, in any event, have been a curious result if the wage restructuring exercise effected by the adoption of cl 7A were to result in an extension of the operation of the award. In the absence of express words to that effect, I would be reluctant to reach such a conclusion. However the problem does not arise because the structure prescribed by cl 7A was as inconsistent with its application to the appellant as was that prescribed by cl 7. The award must be read as a whole. The wage structures prescribed by cll 7 and 7A, were intended to be exhaustive in prescribing wage rates for persons whose employment was governed by the award. It follows that the appellant's terms of employment were not governed by the award. For those reasons, I would dismiss the appeal. I certify that the preceding thirty-four (34) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Dowsett.

Associate: Dated: 3 September 1999 Counsel for the Applicant: Mr S Howells

Industrial Relations Act 1988(Cth)s 170MC

Workplace Relations Act 1996(Cth)

Workplace Relations and Other Legislation Amendment Act 1996(Cth)

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Judgment (15 paragraphs)

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