Fair Work Act 2009

s.739 - Application to deal with a dispute

Dispute about any matters arising under an enterprise agreement - whether employer able to require employees to take rostered days off according to a roster

• [1] Toll Transport Pty Limited provides freight and logistics services for Coles Supermarkets Australia Pty Ltd. It operates a distribution centre for Coles at a site at Kewdale, Western Australia ("Site"). Toll employs truck drivers to transport products from the Site to Coles's supermarkets within Western Australia.

• [2] Those drivers are covered by the Toll - TWU Enterprise Agreement 2023-2026 ("Enterprise Agreement"). The Enterprise Agreement incorporates another agreement that applies to the Site, namely the Toll Logistics, Contract Logistics Division, Coles Western Australia Enterprise Agreement 2008 ("Local Agreement").[1] The Enterprise Agreement also incorporates the Road Transport and Distribution Award 2020 ("Award"), provided that the Enterprise Agreement and the Local Agreement prevail over the Award to the extent of any inconsistency.[2]

• [3] The employees work to a roster under which they accrue rostered days off ("RDOs").[3] In simple terms (and assuming full-time hours of work), an employee works a shift of 8 ordinary hours but is paid for 7.6 hours. The balance of 0.4 hours accrues towards an RDO. In this way, the employee would ordinarily accrue two hours towards an RDO each week. An RDO (7.6 ordinary hours) would accrue after every completed 19 days of work.

• [4] Clause 4.6 of the Local Agreement provides as follows (reproduced verbatim):

4.6.1. Rostered days off (RDO's) are to be taken to suit the needs of the business. RDO's shall not be taken in the two (2) busiest months of the year determined by the business.

4.6.2. Employees are otherwise permitted to accumulate RDO's and provided a minimum bank of 5 days remain available for employer/Employee, allocation blocks of 5 days may be paid, at the rate of time and half, through the payroll system. A maximum of 11 days paid out per annum. This provision shall only apply to all future accruals. Prior accruals shall not form part of this provision.

4.6.3. These can be paid at any time during the year provided one week's notice of the payment request is given.

4.6.4. The Company will allow more than 1 consecutive RDO as long as it does not impact on the business and an experienced driver can be arranged as a replacement, if required.

4.6.5. RDO's will not be unreasonably refused by Management.

• [5] It has generally been left to the employees to decide how they deal with their RDOs. If an employee wishes to take an RDO, the practice has been that they seek management approval at least two weeks prior to the proposed RDO. The relevant manager decides whether to approve the RDO, having regard to the Site's operational needs. Otherwise, employees have been able to accumulate and have their RDOs paid out in accordance with clause 4.6.2.

• [6] In February 2025, Coles requested that Toll optimise the use of its fleet to reduce costs at the Site. In response, Toll proposed to implement introduce a roster under which the employees would be scheduled to take their RDOs on a regular monthly basis during the eight months of the year (February, March and May to October) which are outside the Site's peak periods ("RDO Schedule").

• [7] The Transport Workers' Union of Australia ("TWU") represents employees at the Site. It opposed the introduction of the RDO Schedule. Consultation between Toll, the TWU and affected employees at the Site failed to resolve the dispute.

• [8] Toll referred the dispute to the Commission for conciliation under the dispute resolution clause of the Enterprise Agreement.[4] I conducted a conference with the parties on 24 June 2025, which self-evidently failed to resolve the dispute. Under the terms of the Enterprise Agreement, I proceeded to arbitrate the dispute.[5]

• [9] The parties agreed to the following question for arbitration ("Question"):[6]

"Can Toll Transport Pty Ltd (Toll) direct employees covered by the Toll - TWU Enterprise Agreement 2023 - 2026 (Heads of Agreement) and the Toll Logistics Contract Logistics Division - Coles Western Australia Enterprise Agreement 2008 (Employees) to take rostered days off (RDOs) in accordance with the planned RDO schedule?"

• [10] I note that the premise of the Question is whether Toll is able to ("can") direct the employees to work in accordance with the RDO Schedule, as opposed to whether it should do so.

The principles to apply in construing the Local Agreement

• [11] At its heart, the dispute centres on the proper construction of clause 4.6 of the Local Agreement.[7] In particular, whether it precludes Toll from mandating the implementation of the RDO Schedule.

• [12] The principles to be applied in relation to the construction of enterprise agreements are well established.[8] In Svitzer Australia Pty Limited v Construction, Forestry, Maritime, Mining and Energy Union, The Australian Institute of Marine and Power Engineers and Another the Full Bench observed:[9]

"[109] The approach and the principles relevant to the task of construing the terms of enterprise agreements were set out in a Decision of a Full Bench of the Commission in 'Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union' known as the Australian Manufacturing Workers' Union (AMWU) v Berri Pty Ltd (Berri). The relevant passage setting out the principles is well known, and it is not necessary to repeat it. More recently, in AMA (Victoria) Ltd and Australian Salaried Medical Officers Federation v The Royal Women's Hospital, a Full Bench of the Commission distilled principles from the majority judgment of the Full Court of the Federal Court in James Cook University v Ridd as follows:

'The starting point is the ordinary meaning of the words, read as a whole and in context.

A purposive approach is preferred to a narrow or pedantic approach - the framers of such documents were likely to be of a practical bent of mind. The interpretation turns upon the language of the particular agreement, understood in the light of its industrial context and purpose.

Context is not confined to the words of the instrument surrounding the expression to be construed. It may extend to the entire document of which it is a part, or to other documents with which there is an association.

Context may include ideas that gave rise to an expression in a document from which it has been taken.

Recourse may be had to the history of a particular clause where the circumstances allow the court to conclude that a clause in an award is the product of a history, out of which it grew to be adopted in its present form.

A generous construction is preferred over a strictly literal approach but agreements should make sense according to the basic conventions of the English language.

Words are not to be interpreted in a vacuum divorced from industrial realities but in the light of the customs and working conditions of the particular industry.'"

• [13] In construing an enterprise agreement in its industrial context and purpose, the Commission should adopt an approach that contributes to a sensible industrial outcome.[10] Put differently, construction of ambiguous terms should, where possible, favour a sensible and practical industrial result.[11] Meanings which avoid inconvenience or injustice may reasonably be strained for.[12]

• [14] James Kee is Toll's State Manager Retail Transport and Linehaul (WA). He gave evidence, which I accept, that the Site's two busiest months are December and January, coinciding with the Christmas/New Year period. The next busiest months are November (leading into that period) and April (the Easter period).

• [15] The effect of the RDO Schedule is that employees would be rostered to take RDOs in the other eight months of the year. No employee would be rostered, or permitted to take, an RDO in December or January. Whether an employee would be permitted to take an RDO in November or April would depend on the needs of the business and be subject to management approval.

• [16] Toll contended that the opening sentence of clause 4.6.1 - "Rostered days off (RDO's) are to be taken to suit the needs of the business" - confers a right on it to roster RDOs or to direct employees to take them, provided that it suits the needs of its business. This is the crux of its case. Its position was that the RDO Schedule is designed to address Coles's request that Toll optimise its fleet and reduce costs at the Site. Toll argued that the RDO Schedule meets those objectives and as a result suits the needs of the business. It followed that the RDO Schedule is therefore permitted by and otherwise consistent with clause 4.6.

• [17] The TWU's response, in essence, was that clause 4.6 is directed towards the circumstances in which an employee can take an RDO, or have accumulated RDOs paid out. It submitted that the clause says nothing about Toll being permitted to direct an employee to take an RDO, whether in the terms of the RDO Schedule or otherwise. It contended that the RDO Schedule is, as a consequence, contrary to clause 4.6. It further argued that the RDO Schedule does not meet the needs of Toll's business.

• [18] At the outset, I will address the rationale that Toll put forward for introducing the RDO Schedule. I will do so briefly. The evidence led by the parties in this regard seemed more directed to whether Toll should implement the RDO Schedule as opposed to whether it could do so, which is not particularly germane to the Question.[13] That evidence is only relevant to addressing Toll's contention that the RDO Schedule would meet the needs of the business, thus purportedly enlivening its right to implement it under clause 4.6.1.

• [19] Mr Kee gave evidence to the following effect:

(1) Toll has an "open book" contract with Coles. This requires Toll to provide Coles with details of the costs that Toll is incurring on the Site and charging to Coles. If Toll does not control its costs in the manner agreed with Coles, it will be liable to a financial penalty.

(2) Toll has budgeted for 45 employed drivers at the site. As freight volumes can vary from day to day, or week to week, Toll supplements its employee fleet with casual drivers or subcontracted drivers when required.

(3) In February 2025, Coles requested that Toll optimise the use of its own (employed) fleet in order to reduce costs.

(4) The RDO Schedule was designed to meet Coles's request, by addressing the following concerns:

(a) Having more employed drivers at the Site during non-peak periods than required to meet volumes.

(b) Employed drivers taking blocks of RDOs in conjunction with other leave, requiring Toll to engage casual or subcontracted labour. This comes at a cost to the business, including a loss of productivity as the driver undertakes the necessary Site-specific training.

(c) A lack of stability and predictability in the availability of the employed drivers.

(d) The additional costs associated with employees accumulating RDOs and having them paid out at time and a half.

• [20] The TWU sought to challenge Mr Kee's evidence. It relied on a statement from Kanwaljit Singh, a driver at the Site, who disputed the business reasons that Mr Kee described. Mr Kee was also challenged in cross-examination, particularly on the basis of an asserted failure to produce documentary evidence to corroborate his testimony.

• [21] Mr Kee described his experience working at Toll in various positions since 2001. His evidence as to the operational needs of the Site and the purpose and intended effect of the RDO Schedule was both credible and more persuasive than the TWU's evidence. I accept Mr Kee's evidence.

• [22] I find that if it were implemented, the RDO Schedule would meet the needs of Toll's business. But it does not follow that Toll is therefore permitted to mandate its introduction.

• [23] Toll submitted that clause 4.6.1 "expressly creates a right for Toll to roster or direct the Employees to take RDOs".[14] That is not correct. Clause 4.6.1 says nothing expressly about Toll being able to do either of those things.

• [24] Toll further submitted:[15]

"Were clause 4.6 interpreted to provide only for the taking of RDOs requested by an employee, there would be no way to require RDOs be taken to suit the needs of the business. RDOs could only be refused by Toll in accordance with clauses 4.6.4 and 4.6.5 once they were requested by an employee. Employees would also have an unfettered right to accumulate RDOs in accordance with clause 4.6.2 indefinitely. Toll submits that this would have the effect of rendering the first sentence of clause 4.6.1 substantively inoperative..." (Emphasis in original)

• [25] The premise of these submissions is that to be "substantively operative", clause 4.6.1 must be read as permitting Toll to require RDOs to be taken as it considers necessary to suit the needs of its business. Toll submitted that the fact that the clause directs attention to Toll's business needs supports the inference that the clause prescribes a right exercisable by Toll, not by an employee. As Toll knows best what its business requires, it must have the ability to compel the taking of RDOs to meet those needs. To the extent that RDOs are not rostered or scheduled, an employee can accumulate them and have them paid out (clauses 4.6.2 and 4.6.3) or request further RDOs (subject to management approval under clause 4.6.5).

• [26] There is some support in the language of clause 4.6 for such a construction. The reference in clause 4.6.2 to a bank of five RDOs remaining "available for employer/Employee allocation"[16] suggests that Toll is able to "allocate" RDOs. But it is not clear from the language of the clause what "allocation" means, noting that the clause anticipates both Toll and employees "allocating" RDOs.

• [27] However, I do not accept that the first sentence of clause 4.6.1 should be construed in the manner for which Toll contends. In my view, the clause on its terms, and in the context of clause 4.6 and the Local Agreement more generally, is to be read as placing limitations on when an employee may take an RDO. That is, it signals to employees that there are caveats on their ability to take an RDO. I have formed this view for several reasons.

• [28] First, Toll's proposed construction of clause 4.6.1 does not flow easily from the terms the parties adopted. On Toll's case, the first sentence of the clause has to be construed as if it read, in effect: "To suits the needs of Toll's business, RDOs must be taken. Toll may determine when RDOs will be taken."

• [29] Second, the first sentence of clause 4.6.1 refers to RDOs being "taken". I do not accept Toll's submission that "taken" is to be construed as a "counterpoint to the concept of accumulate".[17] The verb "take" can mean "to avail oneself of (an opportunity, etc.)", "to receive, or be the recipient of (something bestowed, administered, etc.)" or "to have, undergo, enjoy, etc., as for one's benefit".[18] It is the employee who takes an RDO. The clause does not in terms permit Toll to direct an employee to take an RDO.

• [30] Third, were Toll's construction of the first sentence of clause 4.6.1 accepted, the second sentence would be redundant. The "needs of the business" would presumably dictate that RDOs not be rostered in the two busiest months of the year.

• [31] Fourth, the second sentence of clause 4.6.1 makes it clear when employees may not take RDOs. It is consistent with clause 4.6.1 as a whole being read as placing limitations on an employee's ability to take an RDO, rather than conferring a right to mandate the taking of RDOs. That is, Toll determines when RDOs may not be taken (by determining the two busiest months of the year); it does not dictate when they must be taken.

• [32] Fifth, other terms in clause 4.6 demonstrate a consistency in approach, by referring or alluding to an entitlement on the part of an employee, and placing limitations on the exercise of that entitlement. That is:

(1) Clause 4.6.2 "permits" employees to accumulate RDOs to the extent that they have not been taken under clause 4.6.1 and have them paid out, subject to restrictions.

(2) Clause 4.6.3 requires an employee to provide minimum notice of a request to have RDOs paid out.

(3) Clause 4.6.4 states that Toll may "allow" more than one consecutive RDO. This language presumes a request having been made by an employee. The clause specifies the conditions precedent to Toll agreeing to that request.

(4) Clause 4.6.5 provides that RDOs will not unreasonably be refused by management. Again, that language presumes that a request has been made. The clause makes it clear that request may be refused, provided the refusal is not unreasonable.

"...Toll has placed significant emphasis on the first sentence of clause 4.6.1 as providing for such a direction. However, a plain and ordinary reading of the line 'RDOs are to be taken to suit the needs of the business' (First Sentence) indicates (at its highest) that when RDOs are taken by the Employee, the way in which they are taken (including when they are taken) must be acceptable or appropriate to Toll's business operations. It is simply a condition under which RDOs may be taken. In fact, it contemplates the exact system which is currently in operation at the Coles Site and in evidence whereby the Employees request to take RDOs on particular days and these requests are either accepted or refused by Toll based on suitability. This also supports and gives meaning to clause 4.6.5 and indicates that the objective and purpose of clause 4.6 was to allow a

system whereby Employees request RDOs to be taken on specific days in the first instance which Toll can then refuse based on business suitability. ..."

• [34] Toll rejected any suggestion that the operation of clause 4.6.5 was informed by clause 4.6.1. It argued that the former "covered the field" as to Toll's powers to refuse an employee's request for an RDO.[20] By contrast, it contended, clause 4.6.1 was concerned with when RDOs may be taken. I do not accept that distinction. To my mind, the needs of Toll's business would be relevant to a consideration as to whether any refusal of an application for an RDO was unreasonable.

• [35] In addition to these considerations, I accept the TWU's submission that the absence of an express power in clause 4.6 for Toll to mandate the taking of RDOs stands in contrast with other provisions of the Local Agreement. For example, clause 7 deal with annual leave. It has some similarity with clause 4.6, in that it requires annual leave to be taken in line with Toll's operational needs. However, in contrast with clause 4.6, clause 7 requires employees to take annual leave and permits Toll to compel the taking of annual leave if they do not do so.[21] The clause relevantly provides:

7.1.4 The Parties acknowledge the seasonality of the Coles operations and the need for leave to be taken in operationally quiet periods.

7.1.5 The four weeks prior to New Years Day and the two weeks prior to the following Easter are specifically recognised as period when leave would not normally be granted.

7.1.7 Each Employee must take their accrued annual leave within 12 months of the date on which the Employee's entitlement to that leave accrued.

7.1.8 If an Employee fails to comply with clause 7.1.7, the Company may:

7.1.8.1 Direct that Employee to take any overdue annual leave; and

7.1.8.2 Determine the timing of that period of annual leave.

• [36] Toll directed me to the "general objectives" of the Local Agreement set out in clause 2.2.1. These include the development of a "flexible and adaptable workforce" and the removal of "inefficient work practices". I have considered those terms, but they do not detract from the ordinary meaning of the words of clause 4.6, which was agreed at the same time as the "general objectives".

• [37] Toll also directed me to the objectives in clause 2 of the Enterprise Agreement. However, I do not consider that the objectives of an enterprise agreement made in 2013 greatly assists in understanding what the parties intended when creating the Local Agreement in 2008.

• [38] For all of the reasons, I do not accept Toll's contention that clause 4.6.1 creates a right for it to require employees to take RDOs to suit the needs of its business. I acknowledge that the consequence of this conclusion is that an employee may accumulate RDOs indefinitely and request that they be paid out at time and a half, and that this is not in Toll's best interests. But this was the deal that it struck in 2008. A sensible and practical industrial outcome is that the parties be kept to their bargain.

Matters arising from the terms of the RDO Schedule

• [39] In large part, that conclusion disposes of the dispute. However, as the Question relates specifically to "the planned RDO schedule" (noting the use of the definite article) there are three particular matters to address regarding the RDO Schedule.

• [40] First, the RDO Schedule mandates an employee taking eight RDOs each year. Even were the phrase "available for employer/Employee allocation" in clause 4.6.2 be taken to contemplate Toll directing an employee to take an RDO, the clause does not anticipate the roster proposed by the RDO Schedule. The clause requires only that five days (as a minimum) be available for "allocation" by either Toll or the employee.

• [41] Second, the TWU submitted that the RDO Schedule is inconsistent with the employees' rights to accumulate and have RDOs paid out under clause 4.6.2. It contended that the reference in that clause to a "maximum of 11 days paid out per annum" suggests that the clause anticipates an accrual of RDOs that would allow for 11 days to be paid out each year.

• [42] However, any payout of RDOs is conditional on a "bank" of five RDOs remaining. Putting to one side how to reconcile an 11 day maximum with the apparent requirement that RDOs be paid out in "blocks of 5 days", I cannot see how an employee could cash out 11 RDOs each year and still be left with such a bank. This is particularly the case as the clause expressly excludes "prior accruals". The clause is better read as providing for a maximum payout in any year.

• [43] That said, under the RDO Schedule, an employee is likely to accrue a maximum of four RDOs a year. If they apply for and are permitted to take an RDO in November or April, their accrual will be less. To allow for the requirements that RDOs be paid out in blocks of five days and that a bank of five days remain, an employee must have a minimum accumulation of 10 RDOs. Assuming a zero balance at the time the RDO Schedule is implemented, an employee would have no entitlement to have their RDOs paid out until the third year after that implementation at the earliest. This seems to be at odds with the intention of the provision, noting that clause 4.6.3 allows for accumulated RDOs to be "paid at any time during the year", as opposed to during a year.

• [44] Third, the TWU submitted that the RDO Schedule is inconsistent with clause 4.6.1 as it precludes RDOs being taken during four months of the year, as opposed to the two busiest months of the year (December and January). In a de facto sense, that is likely to be right.

• [45] I accept Toll's submission that an employee would be able to apply for an RDO in any month other than December and January. But on the evidence, it is likely only to be a theoretical possibility that an employee would be allowed to take an RDO in November and April. In his oral evidence, Mr Kee accepted that as a general rule, employees are not permitted to take RDOs during the peak periods involving November, December, January and April. He stated that it would be "the ideal state" not to have employees on RDOs during those months.[22]

• [46] However, this is not material. The need to have employees available during peak periods is likely to provide a reasonable basis for a refusal under clause 4.6.5 of an application for an RDO in November or April.

• [47] For the sake of completeness, I observe that Toll led evidence as to the existence of an RDO roster on the site from February 2019 until March 2020 (excluding the Easter/ANZAC Day period in 2019 and the Christmas/New Year period in 2019/2020). The TWU led evidence from three drivers disputing the existence of such a roster. This is not a controversy that I need to resolve.

• [48] Toll submitted that its evidence in this regard was not led to "demonstrate that the existence of a...roster proves that it is possible under the EA".[23] Rather, the evidence "supports the bona fides of the thought process".[24] I have found above that the RDO Schedule would meet the needs of Toll's business. I do not consider that the TWU properly called Toll's "thought process" into question. But again, this is more a matter as to whether Toll should implement the RDO Schedule as opposed to whether it can do so.

• [49] I was asked by the parties to answer this question:

Can Toll Transport Pty Ltd direct employees covered by the Toll - TWU Enterprise Agreement 2023 - 2026 and the Toll Logistics Contract Logistics Division - Coles Western Australia Enterprise Agreement 2008 (Employees) to take rostered days off in accordance with the planned RDO schedule?

• [50] For the reasons set out in this decision, the answer to that question is "No".

[1] Clause 8.1(a) and Part B (item 43) of the Enterprise Agreement

[2] Clause 6(a) of the Enterprise Agreement

[3] It seems uncontroversial that the source of the entitlement to accrue RDOs is clause 13.7(a) of the Award. Neither the Enterprise Agreement nor the Local Agreement contains terms providing for the accrual of RDOs

[4] Clause 15(c). There was no controversy that it was entitled to do so, or that the Commission is allowed to deal with the dispute under section 739 of the Fair Work Act 2009

[5] Again, there was no controversy as to the Commission's jurisdiction to arbitrate the dispute - see clause 15(d)

[6] Initially, the parties proposed a further three questions for determination. However, they later agreed that it was not necessary for me to consider those questions

[7] I accept Toll's submission that clause 4.6 of the Local Agreement is inconsistent with clause 13.7(a) of the Award to the extent that the latter concerns how RDOs are taken. It follows that under clause 6(a) of the Enterprise Agreement, clause 4.6 prevails over the Award term

[8] Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union' known as the Australian Manufacturing Workers Union (AMWU) v Berri Pty Limited [2017] FWCFB 3005 at [114]. See also Linfox Armaguard Pty Ltd T/A Linfox Armaguard v Transport Workers' Union of Australia [2024] FWCFB 373 at [38]- [43]; WorkPac Pty Ltd v Skene (2018) 264 FCR 536; [2018] FCAFC 131 at [197]

[9] [2023] FWCFB 259, see also [110]-[115]

[10] Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241; [2005] HCA 10 at [2] (Gleeson CJ and McHugh J); [96] (Kirby J)

[11] Linfox Armaguard Pty Ltd T/A Linfox Armaguard v Transport Workers' Union of Australia [2024] FWCFB 373 at [39]

[12] Kucks v CSR Ltd (1996) 66 IR 182 at 184, quoted with approval in Svitzer Australia Pty Limited v Construction, Forestry, Maritime, Mining and Energy Union, The Australian Institute of Marine and Power Engineers and Another [2023] FWCFB 259 at [114]

[13] The evidence led by the TWU in the Statement of Kanwaljit Singh of 29 July 2025 as to the potential detrimental impacts of the RDO Schedule on drivers falls into the same category

[14] Applicant's Outline of Submissions, 17 July 2025, par 38

[15] Applicant's Outline of Submissions, 17 July 2025, par 37

[16] It is reasonably clear to me that the comma in this phrase as it appears in the clause is misplaced. To make grammatical sense of the sentence, the sentence must be read as if the comma appeared after "allocation"

[19] Respondent's Outline of Submissions, 31 July 2025, par 30

[20] Applicant's Outline of Submissions in Reply, 7 August 2025, par

[21] It is not necessary to consider the enforceability of this provision in light of the National Employment Standards in Part 2-2 Division 6 of the Fair Work Act 2009. I am considering the clause as part of the context in which the Local Agreement was made in April 2008.

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