Transport Workers' Union of Australia v Linfox Australia Pty Ltd

IN THE FEDERAL COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY FAIR WORK DIVISION VID 246 of 2012

AND: LINFOX AUSTRALIA PTY LTD (ABN 47 004 718 647)

JUDGE: TRACEY J DATE: 8 august 2014 PLACE: MELBOURNE

REASONS FOR JUDGMENT 1 Industrial instruments such as awards and agreements have long been used in Australia to regulate terms and conditions of employment. More often than not they are drafted by non-lawyers. They frequently contain terms which carry a particular meaning to those involved in an industry but which do not have wider currency. Long standing awards and agreements commonly are subject to frequent amendment. Sometimes those amendments, whilst made to meet a particular exigency, have wider implications for the operation of the instrument although this may not be apparent to those responsible for drafting the amendments. 2 There are times during the life of most of these instruments that the parties to them will disagree about the meaning and effect of a particular provision. Each will maintain a bona fide but conflicting belief as to the true meaning of the provision. 3 The present is such a case. A dispute has arisen between the applicant ("the Union") and an employer as to the entitlements of employees to a paid "crib time" of 20 minutes. The Union representing the employees has applied to the Court for orders requiring the employer to pay to each of the employees concerned the amount of the accumulated under-payments and the imposition of a penalty on the employer for contravention of the agreement. The employer maintains that it has satisfied its obligations under the agreement as it understands it and resists the making of any order. 4 In an effort to assist in resolving of the dispute the parties framed a number of agreed questions which they proposed should be answered by the Court. The parties were also agreed that the answers to the questions would render further argument save, perhaps, as to the terms of final orders, unnecessary. I agreed to deal with the proposed questions. 5 In order to understand the questions and the issues which they raised it is first necessary to explain some of the background to the present dispute. In doing so I will draw heavily on an agreed statement of facts. 6 The Union is an organisation registered under the Fair Work (Registered Organisations) Act 2009 (Cth) ("the Act"). The respondent ("Linfox") is a corporation which provides transport services to clients. 7 In about September 2007 Linfox took over a business formerly operated by Westgate Logistics Pty Ltd ("Westgate") at a distribution centre in Altona North known as the Coles Regional Distribution Centre ("the Coles RDC Site"). Linfox has continued to conduct the logistics business formerly operated by Westgate since September 2007. The employees whose entitlements are in question in the proceeding have all been employed by Linfox to perform work at the Coles RDC Site at various times since September 2007. 8 At all material times Linfox has been a respondent to the Transport Workers (Distribution Facilities) Award 2004 ("the 2004 Award"). 9 At all material times prior to 27 March 2006 the 2004 Award bound the Union and Linfox. 10 On 27 March 2006 relevant parts of the Workplace Relations Amendment (Work Choices) Act 2005 (Cth) came into force. Item 4(3) of Schedule 4 provided that the 2004 Award was taken to be replaced by an instrument in the same terms as that Award. By Items 4(3) and (4) of Schedule 5, the Award's terms were, at all material times thereafter, binding on the Union and Linfox. 11 On and after 4 September 2007 all of the employees covered by the present application at some stage performed work covered by the 2004 Award. 12 On 24 November 2005 the Australian Industrial Relations Commission had certified an enterprise agreement under the Workplace Relations Act 1996 (Cth). The parties were Westgate and the Union. The agreement was entitled the Westgate Logistics (G9 Facility) Enterprise Agreement 2005 ("the G9 Agreement"). Linfox became bound by this agreement in September 2007 following its acquisition of Westgate's business at the Coles RDC site. 13 On 10 April 2009 the G9 Agreement was superseded by the Linfox Victoria (Coles RDC) Agreement 2007 ("the Linfox Agreement"). 14 Between 10 April 2009 until 15 May 2011 the Union and Linfox were parties to and bound by the Linfox Agreement. Throughout this period the Linfox Agreement applied to each of the employees whose rights are the subject of the present application. Attached to the Linfox Agreement, as Appendix 2, was the 2004 Award as varied from time to time. By Clause 1.5 of the Agreement all the terms of the 2004 Award were incorporated in the Agreement subject to any inconsistency. It was also provided that the Agreement was to be "read and interpreted wholly in conjunction with" the Award. 15 In 2010 the 2004 Award was merged into a general transport industry award entitled the Road Transport and Distribution Award 2010 ("the 2010 Award"). The provisions which are at the centre of the present proceeding continued in force, albeit it in a modified form. By force of the Linfox Agreement the terms and conditions of the 2004 Award continued to bind the Union and Linfox. 16 Clause 26 of the 2004 Award was entitled "SHIFT WORK". At all relevant times Clause 26.13 provided that: "(a) All shift workers while working on day, afternoon or night shift shall be entitled to a paid crib time of twenty minutes. Such crib time to be allowed and taken as prescribed in clause 26.2.1(d) of this Award. …" 17 Clause 26.2.1(d) provided that: "Crib time on any shift shall be at the time fixed by the employer and shall not be varied except in an emergency and with the consent of the employee; provided, however, that an employee shall not be required to work more than five and a half hours without a crib." 18 These provisions were substantially translated into Clause 24 of the 2010 Award although there was a change in terminology. Clause 24.9 provided that: "All shift workers while working on day, afternoon or night shift will be entitled to a paid meal break of twenty minutes. An employee must not be required to work more than five hours without a meal break." 19 Clause 26.1 of the 2004 Award contained a number of relevant definitions. They were: "26.1.1 'Day shift' means a shift which commences at 5.30 a.m. or later, but finishes at or before 6.30 p.m. 26.1.2 'Afternoon shift' means a shift finishing after 6.30 p.m. but not later than 12.30 a.m. 26.1.3 'Night shift' means a shift which finishes after 12.30 a.m. and at or before 8.30 a.m. … 26.1.7 'Shift work' means work extending for at least two weeks and performed either in daily recurrent periods, wholly or partly between the hours of 6.30 p.m. and 8.30 a.m. or in regular rotating periods." 20 These definitions remained unchanged in the 2010 Award. 21 The Linfox Agreement itself did not make any provision in respect of crib breaks. 22 The relevant employees generally worked from no later than 6:00 am until 2:30 pm each day on five consecutive days each week. Some of these employees also generally work these hours on a sixth day in each week. 23 At no time between September 2007 and May 2011 did Linfox provide a paid crib break of 20 minutes to any of the employees on any day on which the employees worked.

THE AGREED QUESTIONS 24 The questions which the parties posed for consideration of the Court were: "Question 1: Were the Employees as defined in the amended statement of claim dated 27 June 2012 (the ASOC) who worked the hours and days alleged in paragraphs 32-35 of the ASOC (the Employees) "shift workers" within the meaning of clause 26.13(a) of the Transport Workers' (Distribution Facility) Award 2004 (the Award)? Question 2 (needs to be answered if the answer to Question 1 is "yes"): 2.1 In respect of the period 4 September 2007 until 9 April 2009, did clause 26.13(a) of the Awards apply to the Employees? 2.2 In respect of the period 10 April 2009 until on or around 15 May 2011, did clause 26.13(a) of the Award as set out in Appendix 2 of the Linfox Victoria (Coles RDC) Agreement 2008 apply to the Employees? Question 3 (needs to be answered if the answer to Question 1 is "yes" and the answer to Question 2.1 and/or 2.2 is "yes"): If the Employees were not provided with paid crib time of 20 minutes on a day that they worked, are they entitled to be paid an amount in respect of that crib time? Question 4 (needs to be answered if the answer to Question 3 is "yes"): Is the amount the Employees are entitled to be paid in respect of the 20 minute crib time calculated by reference to their ordinary hourly rate of pay or to the overtime rate of pay?" The "employees" referred to in each of the questions are defined, in Question 1, by reference to the provisions of paragraphs 32 to 35 of the amended statement of claim. Each of the employees covered by those paragraphs were employees of Linfox who, at relevant times, commenced work at 6.00 am or no later than 6.00 am on five or six consecutive days each week.

THE APPLICANT'S SUBMISSIONS 25 The Union contended for a literal construction of Clause 26.13(a) and related provisions. It submitted that all of the workers, on whose behalf the proceeding was brought, were "shift workers". Specifically, they were "day shift" workers within the meaning of Clause 26.1.1 because they commenced work at 5.30 am or later each day. As a result they were entitled to crib time in accordance with Clause 26.2.1(d). Reliance was placed on the definition of "shift work" in Clause 26.1.7. The employees worked from no later than 6.00 am until 2.30 pm each day on five consecutive days each week. Their work was, therefore, performed in daily recurrent periods and partly between the prescribed hours. 26 It was common ground that crib time had not been provided to the employees. It followed, so it was contended, that the relevant workers were entitled to be compensated by Linfox for the monetary loss sustained by them by reason of this failure.

THE RESPONDENT'S SUBMISSIONS 27 The respondent tacitly accepted that, on a literal construction of the Award, day workers who commenced work prior to 6.00 am, were bound to be treated as day shift workers who were entitled to the 20 minutes crib time provided for in Clause 26.13 of the 2004 Award. It contended, however, that the relevant provisions had to be read and understood in the light of their historical development, the understanding of them by the principal representative organisations in the transport industry and the conduct of the parties to the relevant industrial instruments and their precursors. 28 These circumstances, it was said, disclosed a common understanding of the relevant provisions that day workers were not "day shift" workers. As day workers the relevant employees were not entitled to crib time or compensation.

CONSTRUCTION OF INDUSTRIAL INSTRUMENTS 29 As is often the case with industrial awards and agreements which have been drafted by non-lawyers, the drafting of the instruments presently under consideration lack the precision and clarity which one would expect to find in a commercial contract. As a result it has been necessary for courts to develop principles to guide the construction of such instruments when, as happens all too often, their meaning and application are in dispute. 30 In dealing with the construction of awards in Kucks v CSR Limited (1996) 66 IR 182 at 184 Madgwick J observed that: "It is trite that narrow or pedantic approaches to the interpretation of an award are misplaced. The search is for the meaning intended by the framer(s) of the document, bearing in mind that such framer(s) were likely of a practical bent of mind: they may well have been more concerned with expressing an intention in ways likely to have been understood in the context of the relevant industry and industrial relations environment than with legal niceties or jargon. Thus, for example, it is justifiable to read the award to give effect to its evident purposes, having regard to such context, despite mere inconsistencies or infelicities of expression which might tend to some other reading. And meanings which avoid inconvenience or injustice may reasonably be strained for. For reasons such as these, expressions which have been held in the case of other instruments to have been used to mean particular things may sensibly and properly be held to mean something else in the document at hand." 31 This passage was quoted with approval by two members of the High Court in Amcor Ltd v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241 at 271 (Kirby J), 282-3 (Callinan J). Shortly afterwards these principles were restated by French J in City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union (2006) 153 IR 426 at 440 [57]: "It is of course necessary, in the construction of an award, to remember, as a contextual consideration, that it is an award under consideration. Its words must not be interpreted in a vacuum divorced from industrial realities - City of Wanneroo v Holmes (1989) 30 IR 362 at 378-379 and cases there cited. There is a long tradition of generous construction over a strictly literal approach where industrial awards are concerned - see eg George A Bond & Co Ltd (in liq) v McKenzie [1929] AR (NSW) 498 at 503-504 (Street J). It may be that this means no more than that courts and tribunals will not make too much of infelicitous expression in the drafting of an award nor be astute to discern absurdity or illogicality or apparent inconsistencies. But while fractured and illogical prose may be met by a generous and liberal approach to construction, I repeat what I said in City of Wanneroo v Holmes (at 380): Awards, whether made by consent or otherwise, should make sense according to the basic conventions of the English language. They bind the parties on pain of pecuniary penalties." 32 In Australasian Meat Industry Employees Union v Coles Supermarkets Australia Pty Ltd (1998) 80 IR 208 at 212 Northrop J expressly agreed with what had been said by Madgwick J in Kucks and held that Madgwick J's observations had even stronger application to certified agreements than they did to awards. 33 In my view, these principles have application to the construction of the instruments which are presently in dispute. 34 Guidance as to the construction of industrial instruments may also be obtained by reference to principles which courts apply to the construction of commercial contracts. Commercial contracts should, as Kirby J held in Pan Foods Company Importers & Distributors Pty Ltd v Australia and New Zealand Banking Group Ltd (2000) 170 ALR 579 at 584 "be construed practically, so as to give effect to their presumed commercial purposes and so as not to defeat the achievement of such purposes by an excessively narrow and artificially restricted construction." An interpretation which accords with business common sense will be preferred to one which does not: see Upper Hunter County District Council v Australian Chilling and Freezing Co Ltd (1968) 118 CLR 429 at 437. 35 In determining whether a commercial document imposes contractual obligations regard is had to the intention of the parties: would a reasonable person conclude that the person making the alleged binding promise intend to be contractually bound by that promise. In Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165 at 179 the High Court summarised the position as follows: "It is not the subjective beliefs or understanding of the parties about their rights and liabilities that govern their contractual relations. What matters is what each party by words and conduct would have led a reasonable person in the position of the other party to believe … That, normally requires consideration not only of the text, but also of the surrounding circumstances known to the parties, and the purpose and object of the transaction." 36 A further aid to construction was referred to in submissions. It related to the possibility that the parties had, historically, adopted a common understanding as to the meaning and effect of disputed provisions in the relevant instruments. 37 Decisions of the Court accept that, in some circumstances, resort may be had to the manner in which a particular industrial instrument or provision in it, has evolved. Differences, however, have emerged as to matters such as whether such an approach is permissible only in order to resolve ambiguity and as to how willing the Court should be to enter this field. 38 In Short v FW Hercus Pty Ltd (1993) 40 FCR 511 Burchett J (with whom Drummond J agreed on this point) affirmed that any provision appearing in an industrial instrument had to be read "in its context". He cited the example of "an expression [that] was first created by a particularly respected draftsman for the purpose of stating the substance of a suggested term of an award, [which] was then adopted in a number of subsequent clauses of awards dealing with the same general subject, and finally was adopted as a clause dealing with that same general subject in the award …". In construing such a provision, his Honour said, "the circumstances of the origin and use of the clause are plainly relevant to an understanding of what is likely to have been intended by its use." (at 517). In supporting this proposition his Honour referred to the dictum of Isaacs J in Australian Agricultural Company Limited v Federated Engine-driver's and Firemen's Association of Australasia (1913) 17 CLR 261 at 272 in which Isaacs J cited Lord Halsbury LC as saying: "The time when, and the circumstances under which, an instrument is made, supply the best and surest mode of expounding it." His Honour concluded (at 518) that: "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, only a kind of wilful judicial blindness could lead the court to deny itself the light of that history, and to prefer to peer unaided at some obscurity in the language. 'Sometimes', McHugh J said in Saraswati v The Queen (1991) 172 CLR 1 at 21, the purpose of legislation 'can be discerned only by reference to the history of the legislation and the state of the law when it was enacted.' Awards must be in the same position." 39 Gray J addressed the issue in Australian Liquor, Hospitality and Miscellaneous Workers' Union v Prestige Property Services Pty Ltd (2006) 149 FCR 209, and Shop Distributive and Allied Employees' Association v Woolworths Limited (2006) 151 FCR 513. 40 In ALHMWU his Honour was concerned to determine whether the Victorian Arts Centre Trust was an "instrumentality" within the meaning of two awards. The respondent had argued that it was not. His Honour said (at 222) that: "For present purposes, I am prepared to accept that the construction of an award can be affected by a common understanding of the parties to it about a particular state of affairs. If such a common understanding existed when the award was made, it should not be departed from when the Court comes to construe the award at a subsequent time. Care must be taken, however, to distinguish a common understanding from common inadvertence. If the only reason why the government instrumentality rates were not paid at the Centre was that neither the union nor the employer adverted to the possibility that there was an obligation to pay them, no common understanding results. In order to have an understanding, it is necessary that there be a meeting of minds, a consensus. There can be no meeting of mind, no consensus, if no-one has thought about the issue." 41 His Honour expressed similar caution in the SDAEA case. He there said (at 520) that: "Counsel for the applicant contended that the past conduct of the parties could be relied upon as an aid in the construction of the Certified Agreement. There is authority that, if a provision has appeared in a series of agreements between the same parties, and if they can be shown to have conducted themselves according to a common understanding of the meaning of that provision, then it can be taken that they have agreed that the term should continue to have the commonly understood meaning in the current agreement. See Merchant Service Guild of Australia v Sydney Steam Collier Owners and Coal Stevedores Assn (1958) 1 FLR 248 at 251 per Spicer CJ, 254 per Dunphy J and 257 per Morgan J, and Printing and Kindred Industries Union v Davies Bros Ltd (1986) 18 IR 444 at 452-453. It is necessary to take great care in the application of this limited principle, to avoid infringing the general principle that the conduct of parties to an agreement cannot be taken into account in construing the agreement. For the limited principle to operate, there must be clear evidence that the parties have acted upon a common understanding as to the meaning of the relevant provision and not for other reasons, such as common inadvertence to its true meaning."

HISTORICAL DEVELOPMENT OF CRIB TIME PROVISIONS 42 With these principles in mind I turn first to the historical antecedents of the provisions presently under consideration. 43 The starting point is the Transport Workers' Award 1983 ("the 1983 Award"). This was an industry award to which the Linfox Transport Group was a respondent. The Award contained no shift work provisions. By Clause 18(a) ordinary hours of work were fixed at 40 per week. Subject to certain exceptions those hours were to be worked in five days of not more than eight hours each between 6.30 am and 6.00 pm on Mondays to Fridays: see Clause 18(b). Exceptions were made for newspaper and food deliveries in Clause 18(d). In such cases the employer could require the employee to commence ordinary hours of work between 12.01 am and 6.30 am. If an employer chose to do so the weekly rate for such an employee was to be increased by 30%. 44 Clause 21(a) provided for regular meal breaks during ordinary hours of work "except where unforeseen extraordinary circumstances arise which make the allowance of the regular meal break impracticable." 45 Not long after the 1983 award commenced Clause 18 was varied to provide for a 38 hour week for employees of respondent employers who were members of the Australian Road Transport Federation. The spread of hours provided for in Clause 18(b) was extended to cover the period 6.00 am to 6.30 pm. In its reasons for making the variation the Full Bench of the Conciliation and Arbitration Commission ("the Commission") said that the purpose of extending the spread by 30 minutes at each end of the day was "to allow greater flexibility without incurring overtime penalty.": see Print F2705 at 3. 46 There was no dispute that the majority of employees in the transport industry were not shift workers. Their terms and conditions of employment and, in particular, their hours of work, were governed by the 1983 Award. 47 The regulation of shift work was dealt with by agreement between the union and employers. On 30 September 1983 the Transport Workers' (Shift Work) Consolidated Agreement 1983 ("the 1983 Shift Work Agreement") was made. The Linfox Transport Group was a party to the agreement. Clause 4 provided that: "(a) The ordinary hours of work of employees on shift work shall not exceed 40 in any week to be worked in five shifts of eight hours on Monday to Friday inclusive. Provided that any shift which commences on or after 11.00 p.m. on a Sunday shall be deemed to be part of the Monday shift and paid accordingly. Such ordinary hours shall be worked continuously except for crib time. (b) Crib time on any shift shall be at the time fixed by the employer and shall not be varied except in an emergency and with the consent of the employee; provided, however, that an employee shall not be required to work more than five and a half hours without a crib." 48 Clause 3 provided definitions of "afternoon shift" and "night shift". The former was defined to mean "any shift finishing after 6.00 p.m. and at or before midnight" and the latter to mean "any shift finishing after midnight and at or before 8.00 a.m." 49 It is also noteworthy that, in September 1983, the Commission handed down its decision in that year's National Wage Case: see (1983) 4 IR 429. The Commission determined that there should be a return to a centralised system of wage fixation. That system was to be governed by prescribed principles. The first paragraph of the principles read: "In considering whether wages and salaries or conditions should be awarded or changed for any reason either by consent or arbitration, the Commission will guard against any contrived arrangement which would circumvent these principles." The Commission went on to state that adjustments to wages and salaries "must constitute a very small addition to overall labour costs." This stipulation was reinforced by the terms of Principle 11 which read: "Applications for changes in conditions other than those provided elsewhere in the Principles must be considered in the light of their cost implications both directly and through flow-ons. Where such cost increases are not negligible, we would expect the relevant employers to make application for the claims to be heard by a Full Bench." 50 Principle 5(a) dealt with hours of work. It provided that: "In dealing with agreements and unopposed claims for a reduction in standard hours to 38 per week, the cost impact of the shorter week should be minimized [sic]. Accordingly, the Commission should satisfy itself that as much as possible of the required cost offset is achieved by changes in work practices. Opposed claims should be rejected." 51 The Principles were invoked when, later in 1983, when the Union sought to vary the 1983 Award so as to extend the benefit of the 38 hour week to the employees of all of the respondent employers. The application was refused under Principle 5(a) because the employers had objected. The Commission noted that there had been "no real discussion" between the Union and the objecting employers. It suggested that the Union negotiate with the objecting employers with a view to reaching agreement. 52 In the meantime, discussions took place between the Australian Road Transport Federation and the Union about extending the 38 hour week to employees covered by the 1983 Shift Work Agreement. On 24 October 1983 the Federation wrote to the Union advising that it agreed, in principle, to the extension of the 38 hour to shift workers "but on the basis of utmost flexibility in implementation." It sought cost offsets. It provided the Union with a draft agreement for consideration. In the draft, it was provided that employees engaged in shift work should have ordinary hours averaged at 38 per week over a 28 day period. The draft also made changes to the definitions of "afternoon shift" and "night shift". An afternoon shift was to be one "finishing after 6.30 p.m. and at or before 12.30 a.m." and a night shift was to be any shift "finishing after 1.00 a.m. and at or before 8.30 a.m." 53 These proposed changes were given effect to by a consent order which was made by the Commission on 7 September 1984: see Print F7388. 54 In 1985 the Commission made two National Wage Case decisions: see (1985) 9 IR 192 and 12 IR 137. The first took the form of a Statement. In it the Commission continued the operation of the principles and recorded its expectation that they would be strictly adhered to by unions and employers: see at 195. The Commission conducted a review and, in its second decision, reaffirmed its view that the Principles should continue to operate. 55 On 27 May 1986 the Australian Road Transport Industrial Organisation ("ARTIO") wrote to the Union and proposed that the shift work provisions which were contained in the 1983 Shift Work Agreement (as amended) should be incorporated in the 1983 Award. 56 On the following day the Union responded to ARTIO's proposal. It expressed a willingness to consider the proposal subject to certain provisos. 57 In handing down its National Wage Case decision in June 1986 (see 14 IR 187) the Commission (at 191-2) expressed its concern that there had been instances in which the Principles had been circumvented or stretched. It reiterated its determination that labour cost increases outside the national wage regime should be minimised. The Commission also drew attention (at 212) to what it considered had been breaches of commitments, given by unions, not to make additional claims outside the framework of the Principles. It, therefore, incorporated a revised Principle that no application for a National Wage adjustment to an award would be approved "unless all the unions concerned in the award give an undertaking that until the next National Wage case decision they [would] not pursue any extra claims, award or over award, except in compliance with the Principles": see at 256. Condition 11 was left in its original form. 58 In July 1986 the Union sought to have the 1983 Award varied to increase wages in accordance with the National Wage case decision. The Union provided the necessary no extra claims undertaking and the variation was approved: see Print G3781. 59 In December 1986 ARTIO again raised with the Union the issue of incorporating shift work provisions in the 1983 Award. It proposed the insertion of a new Clause 18A headed "Shift Work". The draft of this proposed clause included the 38 hour per week averaging provision and the crib time provision from the Agreement. It provided for shift rosters. A new Clause 18A(ii)(d) was proposed. The draft read: "Transfer of Day Worker to or from Shift Work Day workers, given at least ten hours off duty immediately before commencing, or after ceasing shift work, may be transferred to, or from shift work on forty-eight hours notice. In default of such notice shall be paid overtime rates for all work done outside previous ordinary working hours within forty-eight hours of the time notified of the change." 60 ARTIO's draft also proposed the addition of new definitions in Clause 8 of the 1983 Shift Work Agreement. Those definitions were: "Day shift means a shift which commences at 6.00 am or later, but finished at or before 6.30 pm. Afternoon shift means a shift finishing after 6.30 pm but not later than 12.30 am. Night shift means a shift which finishes after 12.30 am and at or before 8.30 am. … 'Shift work' - means work extending for at least two weeks and performed either in daily recurrent periods, wholly or partly between the hours of 6.30 pm and 8.30 am or in regular rotating periods." 61 ARTIO also suggested the insertion of a new Clause 21(e) under the heading "Meal Times" which was to read: "All shift workers whilst working on day, afternoon or night shift shall be entitled to a paid crib time of twenty minutes. Such crib time to be allowed and taken as prescribed in sub-clause 1 (d) hereof. (1) Unless the period of overtime is less than one and a half hours an employee before starting overtime after working ordinary hours shall be allowed a meal break of twenty minutes which shall be paid for at ordinary rates. An employer and employee may agree to any variation of this provision to meet the circumstances of the work in hand provided that the employer shall not be required to make any payment in respect of any time allowed in excess of twenty minutes." 62 These proposals clearly drew a distinction between day workers and shift workers. Although no definition of day worker appeared among the draft amendments it was tolerably clear in the context that ARTIO was referring to workers who performed their duties within the range of ordinary hours as "day workers". 63 In its 1987 National Wage case decision, handed down in March 1987 (see 17 IR 65), the Commission reviewed and amended the Principles. It emphasised the need for "proper restraint" in relation to wages (at 98) and stipulated that any movements in wages and improvements in conditions had to fall within the limits prescribed by the Principles. The Commission granted what it described as a "First Tier" National Wage increase of $10 per week. It also provided for "Second Tier" adjustments subject to certain conditions including a 4% ceiling (at 99). A "restructuring and efficiency" principle was included. It contemplated that Second Tier wage increases might be justified as a result of efficiency improvements to work and management practices and it expressly referred to the possibility of changes to working patterns being necessary. 64 The Principles continued to provide that no adjustments would be made to Awards without Unions making the no extra claims commitment. The Union gave the necessary commitment in order to obtain a variation of the 1983 Award: see Print G7109. 65 On 19 May 1987 ARTIO applied to the Commission to vary the 1983 Award. It sought the insertion of an appendix to deal with shift work. The appendix contained the provisions which ARTIO had proposed to the Union in December 1986. The application was made on a few terse grounds: the changes were in the public interest; provisions of the 1983 Shift Work Agreement were being incorporated in the Award; and the proposed provisions would allow all employers to conduct shift work in any of their operations. This latter ground was, it would seem, intended to convey that, if the appendix was added to the Award, respondency problems would be obviated. 66 ARTIO's application came on for hearing before a Commissioner on 16 June 1987. Both ARTIO and the Union were represented. ARTIO's representative outlined the provisions in the proposed appendix. Having done so he advised the Commission that: "We believe that the application itself does no more than incorporate the current provisions of the agreement between ARTIO and the TWU and where it has been extended that extension is consistent with the practice in respect of shift work generally within the community and the major extension, the major difference, between the current agreement and this agreement is that we have reached agreement with the TWU for the introduction of shift work on the basis of seven days. The old agreement was Monday to Friday only." He went on to say that ARTIO did not consider the variations which it was seeking were in any way inconsistent with the applicable wage fixation Principles. 67 The representative of the Union directed attention to ARTIO's third ground which related to the advantages to employers of being able to operate shifts. In this regard he said: "The only point I make in respect of that is that the union and ARTIO have not valued that advantage in respect of the restructuring and efficiency principles of the national wage decision of March 1987 and we may wish to take that into account in the future." 68 He went on to advise the Commission that it would be very difficult to provide any costings in respect to advantages flowing from the wider availability of shift work. 69 At this time most employees covered by the 1983 Award were day workers. Neither side advised the Commission that the incorporation of the shift work provisions in the Award would have the effect of changing the status of day workers to shift workers. Any such change would have had significant financial implications for employers. It is highly unlikely that ARTIO would have applied for variations which would have produced this outcome and sought the variations on the ground that it would advantage employers. Furthermore, had the Commission been advised of such an outcome, serious questions would have arisen as to whether the proposed variations could have been made consistently with the then operative wage fixation Principles. 70 Having heard the submissions the Commissioner determined that he could see nothing in the proposed appendix "which offends the standards of the commission, the national wage principles, and I think under all the circumstances, taking into account the explanation [ARTIO] has given as to the detail of the document, that the application for variation should be granted and an order will be issued in those terms." The appendix only applied to ARTIO members and their employees. 71 The Union and ARTIO then entered into negotiations about a Second Tier wage rise. In December 1987 they proposed that the 1983 Award be varied to increase wage rates. This increase was, in part, said to be justified pursuant to the restructuring and efficiency Principle. A series of variations to the Award were proposed in order to improve the efficiency of work practices. These included bringing forward the spread of hours in Clause 18(b) from 6.00 am to 5.30 am and by facilitating consensual application of the shift work provisions in the appendix to employers who were not members of ARTIO. These variations were made: see Prints H0407 and H2853. 72 In its 1988 National Wage case the Commission determined that there should be a new structural efficiency Principle: see (1988) 25 IR 170 at 175. 73 In July 1989 the Union applied to the Commission to set aside the 1983 Shift Work Agreement on the ground that it had become obsolete once the appendix had been added to the 1983 Award. ARTIO supported the application. The application was granted by the Commission as a practical application of the structural efficiency Principle: see Print H9515. 74 In August 1990 the Commission, again acting pursuant to the structural efficiency Principle, varied the 1983 Award by deleting the appendix and incorporating the shift work provisions as Clause 41 in the Award. 75 In June 1996 the Union served a log of claims on Linfox Transport (Aust) Pty Ltd. The log of claims included a demand that employees should not be required to work more than 32 hours per week. These hours were to be worked "in the case of day workers, between the hours of 8.00 am and 4.00 pm Monday to Friday." A four day week was also claimed. Separate claims were made in relation to shift work. The dispute to which the service of this log gave rise led to the making of the Transport Workers (Distribution Facilities) Award 1996 (the "1996 Award") in July of that year. Clause 26 of this new Award contained provisions in the same terms as those presently under consideration. 76 In applying for the making of the Award the representatives of both the Union and Linfox assured the Commissioner that the terms of the proposed Award did not offend then existing wage fixation principles. The Union's representative went on to say that the Union did not consider that the proposed Award varied any terms and conditions of employment which existed at the time. Neither party suggested that workers who had previously been considered to be day workers would have their status changed to shift workers. The Commissioner made the 1996 Award saying that it was within or in accordance with the wage fixing Principles. 77 In November 1998 the 1983 Award was rewritten following a review conducted under the Workplace Relations and Other Legislation Amendment Act 1996 (Cth). It was renamed the Transport Workers Award 1998. Despite the extensive redrafting the provisions relating to ordinary hours and shift work were not changed. They appeared in new Clauses 33 and 34: see Print Q8693. 78 In February 2004 the 1996 Award was substantially (but not relevantly) changed as part of an award simplification process. It was renamed the Transport Workers (Distribution Facilities) Award 2004 (Cth), that is, the 2004 Award which contained the disputed provisions relating to crib time entitlements. 79 As noted above at [15] the 2004 Award was superseded, in 2010, by the 2010 Award.

THE TRANSPORT INDUSTRY 80 Linfox called evidence from Mr Paul Ryan, an industrial relations adviser with 25 years' experience of industrial relations in the transport industry. He deposed that, historically, the "entire industry [had] structured itself on the basis that workers engaged in day operations commenced [work] between 5:30 am to 7:00 am and fall within the ordinary hours clause of the [2004] award." These workers had never been treated as shift workers under successive awards. He was not aware of any employer in the industry who accorded paid crib breaks to employees in this category. Were such workers to be treated as shift workers under the 2004 Award the result would be, he said, that "99.9% of the industry would be defined as shift workers." This evidence was not challenged by the Union.

CONSIDERATION 81 A literal reading of the definition of "day shift" in Clause 26.1.1, when read with Clause 26.1.7, renders each of the relevant employees a shift worker working the day shift. As a day shift worker each was entitled to a paid crib time of 20 minutes in accordance with Clause 26.13(a). 82 Support for a literal reading of the relevant provisions is to be found in the decision of Moore J in Australian Liquor Hospitality and Miscellaneous Workers' Union v Broadlex Cleaning Australia Pty Ltd (1997) 78 IR 464. He held that an employee who regularly commenced work at 6.00 am and finished work at 2.30 pm each weekday satisfied the definition of "shift work" in the relevant award. The term was defined to mean "a shift on which an employee is rostered to commence before 6.30 am or rostered to finish after 8.00 pm." His Honour found that, not only did the employee satisfy the temporal elements of the definition: he was also to be regarded as someone who was rostered on a "shift". In the context of the award rostering did not imply movement between different periods of work. It comprehended a regular period of work each day from week to week. 83 Some further support for the Union's construction may also be derived from Wilcox J's decision in Durnford v Allen Taylor and Company Limited (1990) 34 IR 423. His Honour was called on to determine whether workers who were required to work, on a regular basis, during the span of ordinary working hours, were "shift workers". Although the relevant award contained definitions of "afternoon shift" and "night shift", it did not contain a definition of "day shift". Notwithstanding the absence of such a definition, his Honour was prepared to treat day workers as "shift workers". As such their entitlement to a meal break was regulated by the clause of the award which dealt with shift work rather than that which dealt with ordinary hours of work. 84 In Duncans Holdings Limited v Cross (1997) 76 IR 261 Wilcox J dealt with a claim by three boilermakers that they were entitled to a one hour lunch break which the relevant Award prescribed (in Clause 30(h)(i)) for those performing "non-continuous shift work". Each of the workers attended a boiler which operated continuously over five days per week. They worked five 12 hour shifts each week. His Honour held that they could not be regarded as non-continuous shift workers. Rather, they fell within the award category of those performing "continuous shifts" who were entitled under Clause 30(h)(ii) to a 20 minutes paid crib break. His Honour said (at 263-4) that: "Policy reasons support the view that the work done by the present respondents fell within cl 30(h)(ii) rather than cl 30(h)(i). Where cl 30(h)(i) applies, the employee is entitled to a one hour, unpaid 'lunch break'. Where cl 30(h)(ii) applies, a one hour meal break is not provided, merely a 20 minute crib break. The difference between the two breaks extends beyond duration. A 'lunch break' is a period of time during which employees are free, not only to eat a meal, but to leave their immediate workplace - in this case the boiler room - and socialise with other workers elsewhere in the establishment, or even leave the employer's premises altogether on business of their own. A 'crib break', in contrast, is a period during which the employee may 'down tools' and eat but must remain in the immediate workplace and available in case of any emergency …" 85 Each of the award provision in issue in these cases bore some similarity to those which presently fall for consideration. There were, however, contextual differences. The purpose served by the crib break provision, which was considered in Duncans Holdings, for example, took account of the need for the boilermakers to remain close by the boilers which they attended, during the break period. No similar purpose is served by the crib break provision in Clause 26.13(a) of the 2004 Award. Although the time is limited there would be no reason why a truck driver could not leave his or her vehicle parked securely for 20 minutes whilst he or she attended to personal business such as banking or shopping. 86 The broader context is also significant. In none of these cases was attention directed to the development of the provisions in question with a view to ascertaining whether or not a common understanding of the meaning of the provision could be discerned from its origin and its subsequent application. 87 The evidence in the present case establishes that the benefit of a crib break was, historically, made available to shift workers, as was and is the case in many industrial instruments. It was not made available to those working within the ordinary span of hours provided for in the 2004 and 2010 Awards and their predecessors. Plainly, it was a benefit which had implications for the way in which employers organised working arrangements within their businesses. The 2004 Award, like its predecessors, contains many provisions which distinguish between "day workers" and "shift workers". Clause 26.4, for example, makes provision for a day worker to transfer to shift work. Clause 26.5 deals with the problem created where a shift worker fails to report for duty and it is necessary for a day worker to replace that shift worker on the shift. Separate provisions are made, in Clause 29.3, for the payment of annual leave loadings to day and shift workers. Each of these provisions carried with them financial consequences for the employer. Workers engaged on afternoon and night shifts were, pursuant to Clause 26.7, paid at a higher rate than other workers. 88 In order to make good its contention that workers who performed duties within the ordinary hours of work prescribed by the Awards were shift workers, the Union relied on a literal construction of the definition of "day shift". There can be no doubt that, if a literal construction is applied, a consequence will be that workers in this category whose normal working days start about 5.30 am will be taken to be day shift workers. An examination of the history of the provision, however, suggests that it was never intended by the parties to have this effect. 89 The concept of a "day shift" was introduced into the 1983 Award for the first time in August 1987: see Print G8355. The variation was proposed jointly by the Union and the relevant employer organisation. Had it been intended that employees, who had hitherto been treated as day workers who performed their duties in the ordinary span of hours, were thereafter to be treated as being shift workers, to whom specific provisions of the Award were to apply, it would have been necessary for the parties to so advise the Commission in order that it could be satisfied that the proposed variations complied with the wage fixation principles. No such advice was provided. 90 It might also have been expected that, immediately after the revised Award came into force, the respondent employers would have provided the workers, whose status had changed to shift workers, with the enhanced benefits which that status attracted. Had they failed to do so it would also reasonably be expected that the Union would have sought to enforce the performance of the obligations. Neither the employers nor the Union reacted in this way. It was not until March 2012 when the present demands were made that the Union, for the first time, advocated the construction for which it now contends. Not surprisingly the employers reacted with bemusement. 91 Had matters rested there, it may have been possible to argue that both the Union and the employers (including Linfox) had failed to appreciate the significance of the changes and that their inaction resulted from "common inadvertence". Subsequent events, however, render such an argument unsustainable. 92 Almost a decade later the Union served a log of claims which clearly drew a distinction between day workers, who worked within the ordinary range of hours, and shift workers in respect of whom separate claims were made. The dispute created by this log led to the making of the 1996 Award which contained clauses in the same terms as those which are centrally relevant in the present proceeding. The parties again assured the Commission that the terms of the proposed Award satisfied the then applicable wage fixation principles (including the "no extra claims" commitment) and no intimation was given that a consequence of the making of the Award would be that the majority of workers covered by it would cease to be day workers and become shift workers. Indeed, the Union's representative informed the Commission that the Union did not consider that the proposed Award effected any change to the then extant terms and conditions of employment. 93 When the 2004 Award was made it incorporated the same provisions relating to crib time entitlements for shift workers as had appeared in the 1996 Award. This latter award, in turn, incorporated similar provisions which had previously been found in an appendix to the 1983 Award. The fact that the parties had, at each stage, agreed on the terms of the relevant provision which had consistently been applied in the manner contended for by Linfox in the present proceeding, supports its argument that a common understanding existed. That common understanding should inform the construction of the relevant provisions of the 2004 Award. 94 It is also to be borne in mind that the relevant provisions were incorporated in successive instruments during a period in which changes to awards and agreements were constrained by principles which restricted the granting of wage increases to employees and, more generally, additions to the cost of labour. To this end, it was necessary that parties, who sought adjustments to wages and conditions, satisfy the Commission that such adjustments could be made consistently with the principles. Had the Commission been advised, during the currency of the principles, that successive amendments had the effect of converting the bulk of the workforce covered by the 2004 Award and the Linfox Agreement from day workers to day shift workers with the attendant financial and other consequences, it may be doubted that the Commission's imprimatur would have been forthcoming. 95 This review supports the conclusion that, between the advent of the 1983 award and, in particular, since the introduction into it in 1987 of the shift work provisions, and March 2012, the parties had, by their conduct, demonstrated that they held a common understanding that the provisions relating to crib time applied only to shift workers and that the large majority of workers who were treated as "day workers" were not "day shift" workers within the meaning of the award. In such circumstances the literal construction of Clause 26 must give way to the common understanding, over almost a quarter of a century, of the parties whose conduct it regulated.

DISPOSITION 96 For these reasons I would answer the first question posed by the parties: No. Having done so it is not necessary to answer the remaining questions. 97 It follows, in my provisional view, that the only order that will be necessary, following the answering of the question will be that the Union's application be dismissed. I will hear the parties before making such an order. I certify that the preceding ninety-seven (97) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Tracey.