The Local Government Engineers Association of New South Wales v MidCoast Council

Industrial Relations Commission (NSW)|2021-09-27

decision

On 30 June 2020, pursuant to s 130 of the Industrial Relations Act 1996 (NSW) ('the Act'), the applicant notified the Commission of an industrial dispute concerning the rate of superannuation certain employees of the respondent should receive.
The substance of the dispute is whether those employees should be entitled to superannuation: 1. At a rate which is fixed at 6% above the minimum statutory superannuation rate, as that minimum rate rises; or 2. At 15.5%, such that increases to the statutory minimum superannuation rate, which is less than 15.5%, are absorbed into that rate.
It is agreed between the parties that the Commission should "arbitrate" to resolve the dispute.
It is not agreed what the Commission may do to conclude that arbitration, and therefore the basis on which the superannuation dispute between the parties will be resolved.
In short, the applicant contends that it was the intention of the parties, set out in an enterprise agreement, that the Commission arbitrate a final outcome, and that this enlivens s 136(1)(d) of the Act such that the Commission may make an order in arbitrating the matter. Alternatively, the Commission may give a direction, pursuant to s 136(1)(a) of the Act, in arbitrating the matter.
The respondent contends that the Commission may only make an award, pursuant to s 136(1)(b) of the Act in arbitrating the matter. The applicant accepts that the Commission may make such an award but observes that such an award would need to comply with the wage fixing principles.
This is a procedural ruling determining what the Commission is empowered, by s 136 of the Act, to do in arbitration proceedings concerning the industrial dispute notified to the Commission by the applicant on 30 June 2020.

The 2019 enterprise agreement

Mr Marzato and Mr Nassif also gave evidence of the negotiations leading to an enterprise agreement between the parties and covering inter alia the relevant employees. In the main this was not controversial between the parties.
Beginning in 2018 and concluding in 2019, the applicant, the respondent and the other parties to these proceedings negotiated an enterprise agreement covering some of the respondent's employees, including the relevant employees. This agreement was approved by the Commission on 20 May 2019 as the MidCoast Council Water Services Enterprise Agreement 2019 ('the Enterprise Agreement').
While all other terms of employment to be covered by the Enterprise Agreement were agreed, the applicant and respondent were unable to agree on the rate of superannuation for the relevant employees under the Enterprise Agreement.
The applicant maintained that the relevant employees should continue to enjoy superannuation contributions at a rate 6% above the prevailing statutory minimum superannuation rate.
The respondent maintained that the relevant employees should continue to enjoy superannuation contributions at a rate of 15.5% but that any increases in the statutory minimum superannuation rate should be absorbed into the 15.5% superannuation rate.
For the purpose of allowing the remaining issues to be finalised in an enterprise agreement to be approved, a superannuation clause which sought to defer decision-making on the rate of superannuation to the Commission was included in the Enterprise Agreement.
Clause 33.1.a. of the Enterprise Agreement, provides that: "An employee's entitlement to 15.5% superannuation shall remain with the employee whilst they remain continuously employed with MidCoast Council. The matter of absorbability will be dealt with by the NSW Industrial Relations Commission by way of arbitration."
It is worth observing that the difference in the position of the parties would not cause any practical difficulties until the statutory minimum superannuation rate increased above 9.5%. At the time the Enterprise Agreement was approved this increase was legislated to begin increasing above 9.5% on 1 July 2021.
On this point, it was put to Mr Marzato that, because there had been some doubt that the government would proceed with increasing the statutory minimum superannuation above 9.5%, it wasn't guaranteed that the Commission would ever be called on to arbitrate. Mr Marzato agreed it would be "pointless" to ask for arbitration if the government "completely back-[flipped]" on the rate increase, but the substance of his evidence was that eventually the issue was one which would have to be addressed.
From the evidence before the Commission it was clear that the process by which the Commission should resolve this question was not considered in detail, or perhaps not at all, by the parties. In her oral submissions, Ms Saunders of Counsel, who appeared for the applicant, summarised this as the parties not considering the "niceties" of the process, a summary description readily adopted by Mr Nassif for the respondent.
In cross-examination, Mr Paul Marzato agreed that in drafting cl 33.1.a. of the Enterprise Agreement no-one considered the technical formalities by which the Commission would arbitrate this matter.
In anticipation of the statutory minimum superannuation rate increasing, the applicant notified an industrial dispute to the Commission pursuant to s 130 of the Act. It sought the assistance of the Commission to resolve the rate of superannuation the relevant employees should receive.

The applicant's submissions

The applicant's primary submission was that the Commission may make an order "in respect of the question of absorbability" pursuant to s 136(1)(d).
In written submissions dated 24 May 2021, the applicant submitted that (references omitted): "12. It is uncontroversial that the Commission is not at large to make orders in the resolution of industrial disputes. Its authority must bring from somewhere. Most easily this power is found in the residue of the Act; which expressly permits certain orders (e.g. secret ballots) to be made. Less directly, the authority can arise expressly or by implication from dispute resolution procedures in approved industrial instruments. 13. More broadly, the power can arise from the proper exercise of the Commission's functions. As Newall C said in New South Wales Local Government, Clerical, Administrative, Energy, Airlines and Utilities Union v Warringah Council [2015] NSWIRComm 1012 at [53], considering s.136(1)(d): [53] However, in my view the Commission is authorised to make an order that the parties to an industrial dispute maintain the status quo ante in relation to, for example, terms and conditions of employment that have operated between them: Broken Hill Chamber of Commerce and CFMEU (NSW Branch) [2002] NSWIRComm 244. The Commission is equally able to make an order that operates to provide fairness: Health Services Union NSW and Central Coast Local Health District re Regrade Policy [2013] NSWIRComm 44, which in this case would hold parties to representations they have made to each other in relation to the subject matter of a dispute. Were I wrong about that, the Commission has in my view power to make orders as it sees appropriate to fulfil the Objects of the Act, in this case particularly the Objects set out in subs.3 (a), (g) and (h). 14. The critical similarity across all the potential orders made is their link to arbitral rather than judicial power: the focus is on creating new rights and obligations rather than enforcing existing entitlements. 15. Section 136(1)(d) additionally does not limit the type of orders that may be made; indeed, by the words 'any kind' it can be seen that the drafters contemplated a range of options. This indicates that a broad interpretation of the word 'order' should be preferred. The ordinary meaning of the word is 'an authoritative command or instruction': that is, it is a determination that must be followed. 16. At issue, then, is whether cl.33(1)(a) provides the necessary authority. Although the parties and not use the word 'order' expressly, it is nevertheless tolerably clear that: a. cl 33(1)(a) reflects an intention of the parties to outsource the determination of the question of whether grandfathered above-minimum superannuation payments should absorb any increase to the minimum rate; and b. such determination was intended to be final, the latter shown by the use of the word 'arbitration', which in its ordinary sense in the context of industrial dispute resolution conveys the final resolution of the matter."
At paragraph 5 of the applicant's submissions in reply the applicant further submitted that (references omitted): "5. While, as a general proposition, evidence of the subjective intention of the parties would not be admissible as an aid to construction of an enterprise agreement, an exception exists where the evidence is strong enough to demonstrate a degree of mutuality such that a common understanding arises. That is so here. It confirms what is apparent on the text: the clause, correctly interpreted, reflects a consent to arbitration such that the Commission may finally determine the matter."
In her oral submissions Ms Saunders reiterated that cl 33.1.a. of the Enterprise Agreement provided the authority which would permit the Commission to make an order pursuant to s 136(1)(d).
Ms Saunders took the Commission to NSW Teachers Federation v Department of Education and Training (2003) 121 IR 177; [2003] NSWIRComm 145, at [31] and [32], submitting that the power of the Commission to make orders pursuant to s 136(1)(d) must have a source somewhere other than s 136 itself. She submitted that the power may be "elsewhere in the Act or simply elsewhere", noting that Acts other than the Industrial Relations Act give powers to the Commission.
Ms Saunders took the Commission to the use of the word 'arbitration', and to the use of the words 'will be dealt with' in cl 33.1 a. of the Enterprise Agreement, to demonstrate that the parties both intended and consented to the Commission providing a binding resolution of an otherwise "intractable matter which was … impeding the timely conclusion of negotiations".
In Ms Saunders' submissions the clear evidence before the Commission was that there was a common understanding that the clause was inserted to ensure the question of superannuation would be resolved by the Commission in some way.
Ms Saunders argued that requiring the applicant to meet the wage fixing principles, which would be required if the Commission was to make an award pursuant to s 136(1)(b), would add a threshold question to the task. This, Ms Saunders submitted, was not what the parties had contemplated in cl 33.1.a.
In the alternative, the applicant submitted that the Commission may resolve the dispute by giving a direction pursuant to s 136(1)(a).
In written submissions dated 24 May 2021, the applicant submitted that (references omitted): "19. The word 'direction' is inherently mandatory: it is an instruction as to how to do something. That it is intended to be so can be seen from its immediate documentary context. It is a counterpoint, placed in the direct alternative by the word 'or', to a recommendation - i.e. a suggestion. 20. This interpretation is further bolstered when one considers the underlying purpose of s.136: it is to facilitate the final step in the Commission's dispute resolution processes, i.e. the arbitration of disputes, which as set out above is a process which necessarily confers finality. In an employment context, disputes are most commonly resolved by one party being told to, moving forward, do or not do something. 21. To the extent that it is occasionally suggested that this power concerns procedural directions only, this is unlikely to be correct. There is no such thing as a procedural 'recommendation'. The residue of the powers granted are directed at substantive matters and, with the exception of the references to interim orders, finality. These are strong contextual indicators that the word 'direction' should be similarly imbued with substance: the word takes its character from its surroundings. 22. Further, it is inconsistent with the way the phrase is used elsewhere in Part 1 of Chapter 3. Per s.134(2), in conciliation the Commission is equally empowered to make recommendations or directions. That subsection continues: 'Failure to comply with any such recommendation or direction may not be penalized but may be taken into account by the Commission in exercising its functions under this Act.' 23. This cannot be sensibly read as referring to matters of procedure rather than substance. 24. Finally, the Commission's power to control its own procedures is found elsewhere in the Act - in Part 5 of Chapter 4, appropriately titled 'procedure and powers of the Commission'. A separate power within s136 to make procedural orders is not necessary. Indeed such an interpretation gives it no work to do, and additionally hampers the practical dispute resolution processes of the Commission."
In an exchange with the Commission, Ms Saunders agreed that a 'direction' pursuant to s 136(1)(a) of the Act was different from an 'order' pursuant to s 136(1)(d), but submitted that for current purposes, the permitted scope of a direction pursuant to s 136(1)(a) of the Act was sufficiently broad that the Commission could give a direction which would answer the question of the superannuation rate the relevant employees should enjoy.
In response to suggestions that directions given pursuant to s 136(1)(a) of the Act should relate only to procedural matters, the applicant's position is summarised within paragraph 10 of its submissions in reply: "10. … For one thing, there is a tacit acceptance that a recommendation would be concerned with substance rather than procedure. It cannot be said that a recommendation would not be capable of finally resolving a dispute. Although not necessary guaranteeing finality in that a party would be free to ignore it, a recommendation as an outcome of arbitration would necessarily be directed at resolving the substance of the dispute rather than merely facilitating it being heard. There is no reason why the power to issue directions conferred within the same subsection would not be similarly directed."
In both the applicant's written submissions, and in the oral submissions of Ms Saunders, the applicant agreed that it was open to the Commission to resolve the superannuation dispute by making an award pursuant to s 136(1)(b) of the Act. However, this would come with the obligation on the Commission to proceed in accordance with the wage fixing principles.

The respondent's submissions

The respondent agreed that the substance of the issue between the parties, being the "question of absorbability", was the issue set out in paragraph 3 of this decision.
The respondent agreed with the applicant that the Commission's arbitral powers in s 136 are not at large. The respondent took the Commission to the same decision cited by the applicant, being NSW Teachers Federation v Department of Education and Training, at [31] and [32]: 31. While the Commission undoubtedly has very wide powers to deal with disputes notified unders130 of the Act, in arbitration it is not empowered to make any kind of order which might seem just in the circumstances of the particular case. In this respect, the power stands in contrast to the predecessor legislation, such as s25 of the Industrial Arbitration Act 1940 (NSW), where, for example, orders or awards could simply be made about "industry disputes". Section 136 contains a more restricted power. 32. Apart from disputes, s136(1)(d) contemplates the making of various types of orders which the Commission is "otherwise authorised to make". This includes orders of reinstatement, re-employment and compensation under s 89, in relation to unfair dismissal; orders for reinstatement of injured workers under s 94; even demarcation orders under s 294.
The respondent's written submissions accordingly argued, at paragraph 23, that: 23. As such it is not open to the [applicant] to adopt an expansive interpretation to the words "… of any kind"; indeed it cannot be claimed that section 136(1)(d) provides for unfettered and unlimited types of orders that may be made by the Commission.
The respondent's written submissions in respect of s 136(1)(d) of the Act also submitted that: 20. Section 136(1)(d) is self-regulating in providing that in arbitral proceedings the Commission may make any kind of order that is authorised to make. The reference in section 136(1)(d) to the authority of the Commission to make orders is a reference to the statutory authority under which the Commission operates. The authority of the Commission to make orders does not arise from an inference contained in an industrial instrument nor does it come from the whim or desire of a party to an enterprise agreement. … 24. In Fire Brigade Employees' Union of New South Wales (on behalf of Rampling) v Industrial Relations Secretary (Fire & Rescue NSW) (No 2) [2020] NSWIRComm 1060, Sloan C dealt with a notice of motion that sought the making of an interim order pursuant to section 136(1)(d). In that instance the applicant union relied upon section 136(1)(d) in claiming that the legislative provision empowers the Commission in arbitration proceedings to "make any other kind of order it is authorised to make (including an order made on an interim basis)". At [12] of the decision Sloan C held that: "In my opinion, the word 'authorised' is key. The legislature did not use words such as 'necessary' or 'appropriate', but 'authorised'. In the context of a tribunal such as the Commission, which is a creature of statute, the word 'authorised' must be referrable to a power conferred by legislation, whether the Industrial Relations Act or one of the other acts conferring jurisdiction on it". In this regard and consistent with the observations of Sloan C above, the respondent submits that nothing in the Industrial Relations Act (1996) (NSW) confers on the Commission the power to make an order of the kind sought by the [applicant], that being an order that addresses the matter of absorbability. 25. The Respondent's view is also supported by the observations of Newall C in Public Service Association of NSW o/b Ferns v Fire and Rescue NSW [2018] NSWIRComm 1014 at [20]. The Commissioner considered the nature of the orders that were available to resolve a dispute and held that: "There is ample authority for the proposition that 'any other order the Commission is authorised to make' under the Act means one of the orders specifically set out in the statute."
In reply, Ms Saunders referred the Commission back to Ferns decision, at the paragraph cited by the respondent [1] . Commissioner Newall's next sentence begins "It might also conceivably mean an order which the Commission has an implied power to make …". In that matter, Commissioner Newall determined that no relevant implied relevant power could be found in the Act.
The respondent's written submissions on the contention that the Commission may give a binding direction pursuant to s 136(1)(a) of the Act in this matter were that: "28. The [applicant] views the provisions of section 136(1)(a), specifically a 'direction' of the Commission, to be a viable alternative to an order pursuant to section 136(1)(d). In this regard it is contended at paragraph 19 of the [applicant's] submissions that a direction confers finality in the context of a dispute. The Respondent Council opposes this interpretation of section 136(1)(a). 29. While the notifying union believes its position is supported by the observation that there is no such thing as a procedural recommendation, the observation can alternatively be framed to note that a recommendation does not necessarily confer finality in the context of an industrial dispute. Therefore, the reference to the Commission 'giving a direction' in the context of a provision that also contemplates the commission 'making of a recommendation' suggests that the reference is more appropriately viewed as a power to make a procedural direction. A procedural direction that has the same efficacy as the directions that are made by the commission when articulating the timetable, processes and procedures that will need to be adhered to for a matter to be arbitrated in a timely manner. 30. In Fire Brigade Employees' Union of New South Wales (o/b Rampling) v Industrial Relations Secretary (Fire & Rescue NSW) (No 2) [2020] NSWIRComm 1060, Counsel appearing on behalf of the applicant union sought to equate the concept of an order with that of a direction. In response to that submission the Commission observed at [14]: "It is enough to dispose of that argument to observe that s 136(1)(a) confers on the Commission a specific power to make a direction which stands apart from an order such as referred to in s 136(1)(d)." 31. Clearly, a direction cannot be viewed in the same light as an order. It cannot be characterised in the same way as an order in that it is not meant to be viewed as a conferring finality in the same way that is contemplated by an order of the Commission."

Findings as to Facts

While some energy was expended in taking the Commission to differences over the facts, there was, in reality, very little on which the parties disagreed.
It was common ground that: 1. The parties could not agree on whether any increases in the statutory minimum rate of superannuation would be absorbed into the prevailing rate of 15.5% paid to the relevant employees; 2. In order to have the Commission approve the Enterprise Agreement, this question was deferred; 3. The question was to be resolved by arbitration, that is by the Commission deciding which outcome would prevail; and 4. The parties did not give detailed, or perhaps any, consideration to the process by which the Commission would decide the question.
To the extent that it was suggested that the Commission may never need to address the question of absorbability, this misses the point of the agreement between the parties. Whether because the statutory minimum rate was raised, or because the applicant asked the Commission to address the question in advance of such a rise, it is clear that the parties intended the Commission to decide the question of absorbability.
The plain text of cl 33.1.a. of the Enterprise Agreement makes this clear on its face by use of the words "will be dealt with by the NSW Industrial Relations Commission by way of arbitration". The evidence of both Mr Marzato and Mr Nassif was that the Commission would decide the question by 'arbitration'.
In context, and to the extent it is relevant to the current issue before the Commission, this can only mean a process where the outcome, although likely informed by submissions of the parties, is a binding decision of the Commission outside the power of the parties to determine, negotiate or veto.
The wording of cl 33.1.a. of the Enterprise Agreement made clear that the parties did not expect conciliation would resolve the question, and this was also clear from the evidence.
For completeness, I find that a letter from the respondent to the relevant employees dated 29 May 2019, marked MFI1 during the hearing, does not assist understanding of cl 33.1.a. of the Enterprise Agreement. It was created after the Enterprise Agreement was finalised. In any event, in its terms it adds or subtracts nothing from the findings as to facts set out above at [47] to [52].

The question before the Commission

The question is whether, in resolving the superannuation dispute, the Commission: 1. May make an order pursuant to s 136(1)(d) or give a direction pursuant to s 136(1)(a); or 2. Is confined to making an award pursuant to s 136(1)(b).
Pursuant to the authority given to the Commission by s 175 of the Act I now answer that question.

Section 136 (1)(d)

The parties agreed that the Commission's power to make orders pursuant to s 136 (1)(d) in the resolution of industrial disputes is not "at large"; some source of authority outside s 136 is required.
This is both an orthodox position, given that the Commission is a creature of statute, and one clear from a plain reading of s 136 (1)(d). If authority were required for this view, it can, of course, be found in the passages of the NSW Teachers Federation v Department of Education and Training case cited by both parties, at [31] and [32] (Schmidt J).
Ms Saunders specifically pointed the Commission to the parties having agreed to "arbitration", not the full spectrum of powers available to the Commission to resolve an industrial dispute, noting that cl 33.1.a. of the Enterprise Agreement did not "park [the question] and run a dispute with the full spectrum of conciliation, mediation, the variety of options that are available …".
That the parties submitted the question to the Commission for arbitration, and that arbitration is a conceptually well understood process before the Commission, nevertheless still begs the question of whether there is a legislative source of authority for the Commission to make an order pursuant to s 136 (1)(d).
All of the authorities cited proceeded on the basis that some legislative authority is required as the source for the Commission's power to make an order pursuant to s 136(1)(d). I agree that some legislative basis must ultimately be the source of that power.
Neither party referred the Commission to an express authority to make an order based on the intention of the parties as expressed in the Enterprise Agreement. I can find no such express authority.
The authorities cited by the applicant do suggest that an implied power may be a source of authority, but none of the previous cases cited by the applicant involved matters where section 136(1)(d) was used to directly set conditions of employment. They involved cases where the Commission found that s 136(1)(d): 1. Did not extend to the making of injunctions [2] ; 2. Did extend to orders that would require parties to maintain the status quo ante, or uphold prior commitments [3] ; and 3. Might include an implied power, but in that case the power required could not be implied into s 136(1)(d), as the power to make the particular order sought expressly existed elsewhere in the Act [4] .
The applicant emphasised that s 136(1)(d) uses the words "any kind of order" in describing the kind of order the Commission may make pursuant to that provision. I agree with the reasons for decision of Commissioner Sloan in FBEU on behalf of Rampling at [12]: "In my opinion, the word 'authorised' is key. The type of order which can be made by the Commission pursuant to s136(1)(d) is 'any kind of order which is authorised …'". [5]
The Act needs to be read in its full context, taking into account the objects of the Act and specifically the clear purpose of s 136 generally being directed to the resolution of industrial disputes. A meaning which would give effect to these outcomes should doubtless be preferred over one which does not give such effect. However, that outcome must be one that the words of the Act are capable of bearing.
There exists in s 136(1)(b) an appropriate power to set a condition of employment, and so it is not necessary, or obvious, that the Commission should have an implied power pursuant to s 136(1)(d) to set a condition of employment, based on an express referral by parties in an approved enterprise agreement.
It was not the subject of any submission, but I note that the definition of "award" in the Act provides that an award " … includes any order of the Commission under this Act that sets conditions of employment." [6] Accordingly it must be that any order purportedly made under s 136(1)(d) which sets the rate of superannuation would, by definition, be an award. While somewhat circular logic, this does reinforce that the appropriate process in this matter is the making of an award pursuant to s 136(1)(b).
It is clear to me that even if the parties had expressly articulated an agreement to have their dispute resolved by the Commission making an order pursuant to s 136 (1)(d), the Commission would not have the power to make such an order.

Section 136 (1)(a)

The applicant and respondent agreed that there is a difference between an order pursuant to s 136(1)(d) and a direction pursuant to s 136(1)(a). It is clear there must be a difference since the legislature enacted the sections with different words, albeit that both have the character of words which are "mandatory", as Ms Saunders submitted.
It was uncontroversial that the Commission may give what were referred to as procedural directions pursuant to s 136(1)(a).
The applicant submitted that the Commission's power to give directions, while different from an order, could in, this case, extend to a direction which would determine the appropriate superannuation to be paid to the relevant employees.
The only authority cited by the parties which bore specifically on directions pursuant to s 136(1)(a) was the Full Bench decision in Public Service Association and Professional Officers' Association Amalgamated Union of NSW South Wales v Secretary for Industrial Relations [2018] NSWIRComm 1061, at [86] and [87]: 86. This Full Bench acknowledges that the Commission may make directions pursuant to 136(1)(a) of the Act which have coercive force, in the sense that a failure to comply may give rise to proceedings for contempt of the Commission, much in the same way as a failure to comply with summons to appear and/or produce documents may have that consequence. As already indicated, such directions will, in most cases, be of an administrative or facilitative kind, such as a direction to an individual to attend a compulsory conference, a direction that the parties to a dispute confer or a direction that certain individuals take steps to ensure publication and compliance with dispute orders made by the Commission. 87. Directions of that kind are qualitatively different from a direction that an employer pay money to an employee. Further where such an outcome is not permitted by way of a dispute order (sub 137(3)), or the Commission's powers to order an employer to pay money to an employee as specifically provided for by way of the small claims procedure (ss 379 and 380), it appears to us that the legislature did not intend the directions power in s 136(1)(a) to extend that far.
In both written and oral submissions, the applicant posited that it would be a bizarre outcome that a recommendation could be made under s 136(1)(a), but a direction in essentially the same terms, and pursuant to the same section, could not be given. I do not see why this would be a bizarre outcome.
In s 136 generally, and in the remainder of the Act, the Commission has been given a range of tools to resolve industrial disputes. These include the tools in s 136(1)(b) and (c), which it might be said are fundamental to a tribunal such as the Commission, but also expressly include the more flexible tools in s 136(1)(a).
Unlike a court, the Commission has a power of recommendation. Clearly, one reason that power exists is so that in appropriate cases the Commission may make a suggestion, using the Commission's moral authority. It might be thought that the power to make a suggestion was obvious enough to be available to the Commission without being express, but the legislature expressly gave it.
The applicant's submissions also took the Commission to s162 of the Act, arguing that because s 162 gave the Commission authority to control its own procedures, it would be wrong to confine directions pursuant to s 136(1)(a) to largely procedural matters.
In an exchange with the Commission, Ms Saunders rejected the idea that s 162 was more particularly concerned with the processes within the Commission, and that s 136(1)(a) about conduct of the parties, submitting that the Commission's procedure is always externally focused.
Ms Saunders' submissions correctly point to s 162 and s136(1)(a) likely both providing similar power to the Commission in some factual circumstances. Nevertheless, while it might be relatively easy to envisage a factual circumstance where either section could be utilised, the former is directed to the procedure of the Commission, the latter to resolution of an industrial dispute directly, and cases where one or the other is more appropriate are also relatively easily envisaged.
The better section in the Act for comparison and contrast is s 134(2), which has essentially identical wording to that found in s 136(1)(a). It would be incongruous that the Commission in conciliation proceedings could give a direction which purported to pronounce in finality on the substance of a dispute about conditions of employment.
There is, of course, a difference in consequence between s 134(2) and s 136(1)(a) in that a direction pursuant to s 134(2) has no direct consequence, as s 134(2) provides that failure to comply with such a direction "… may not be penalised …". A breach of a direction pursuant to s 136(1)(a) has a consequence, which, as Ms Saunders submitted, is proceedings for contempt. Proceedings for contempt are not a readily useful means to enforce a condition of employment, whereas they are more readily obvious as a consequence for failure to comply with a direction of an administrative or facilitative kind.
Turning to the Objects of the Act, I cannot see that any of them bear on the breadth of a direction pursuant to s 136(1)(a) strongly either way in this matter. Ms Saunders took the Commission to Object (g) in particular, but that objective could readily be met via the making of an award.
While not bearing directly on the breadth of a direction pursuant to s 136(1)(a) Object (e) provides that the Act shall "… facilitate appropriate regulation of employment through awards, enterprise agreements and other industrial instruments". Given the definitions of each of these instruments, Object (e) points to the primacy of specific forms of regulation for conditions of employment over a process such as a direction pursuant to s 136(1)(a).
To the extent that the Commission has the power to give a direction pursuant to s 136(1)(a) for matters beyond administrative and facilitative matters, and the cited Full Bench decision suggests this is at least a possibility, it is sufficient for current purposes to determine that it is too great a stretch that the power extends to a direction which would set conditions of employment.
It follows that the only option open to the Commission in arbitrating the superannuation dispute is to make an award pursuant to s 136(1)(b).
The Commission: 1. Does not have the power to make an order pursuant to s 136(1)(d) in arbitrating this industrial dispute; 2. Does not have the power to give a direction pursuant to s 136(1)(a) in arbitrating this industrial dispute; and 3. Does have the power to make an award pursuant to s 136(1)(b) in arbitrating this industrial dispute. Chris Muir Commissioner

Endnotes

Public Service Association of NSW o/b Ferns v Fire and Rescue NSW [2018] NSWIRComm 1014 at [20]
Notification under section 130 by the New South Wales Local Government, Clerical, Administrative, Energy, Airlines and Utilities Union of a dispute with the Sydney City Council [2003] NSWIRComm 223.
NSW Local Government, Clerical, Administrative, Energy, Airlines and Utilities Union v Marrickville Council [2014] NSWIRComm 1006.
Public Service Association of NSW o/b Ferns v Fire and Rescue NSW [2018] NSWIRComm 1014.
[2020] NSWIRComm 1060 at [12]
Dictionary, Industrial Relations Act 1996 (NSW).

Amendments 20 June 2022 - In the Title added the word "The" in the cover sheet DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 20 June 2022

Industrial Arbitration Act 1940(NSW)

Dictionary, Industrial Relations Act 1996(NSW)

At a glance

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Judgment (11 paragraphs)

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Legislation Cited (3)

Cases Cited (10)

Cited By (6)