United Voice v Wilson Security Pty Ltd

THE BACKGROUND FACTS 9 Those circumstances are not controversial. 10 Wilson Security employs security guards. Mr Norman Davis is an employee of Wilson Security and a member of United Voice. The terms and conditions of employment, at relevant times, were regulated by the Award. 11 Because of the nature of the work, undertaken by security guards, the Award, relevantly permitted Wilson Security to promulgate a roster which contained 152 ordinary hours of work within a roster cycle of four weeks: see cl 21.1(a)(iii). 12 The guards employed by Wilson Security, or some of them, are rostered so as to provide security coverage for clients 24 hours a day, seven days a week. That level of coverage is achieved by rostering guards on seven shifts per fortnight, each of 12 hours' duration. The roster repeats every four weeks and "flips" every fortnight - that is, the day shifts in the first fortnight are night shifts in the second fortnight and vice versa. 13 Prior to 31 October 2016 Wilson Security had constructed the roster for Mr Davis such that overtime rates were not payable until he had worked his full complement of ordinary hours. 14 The roster was then changed to operate in a manner which has given rise to the present proceeding. 15 In order to understand the nature of the variation it will be convenient to set out Mr Davis's revised roster and then to explain the effect of the variation. 16 Mr Davis's roster, in tabular form, was promulgated as follows: Shift Day Start time Finish time Hours Total hours 1 Monday 600 1800 12 12 2 Tuesday 600 1800 12 24 3 Wednesday - - 12 36 4 Thursday - - 12 48 5 Friday 1800 600 12 12 Saturday 1800 600 Sunday 1800 600 6 Monday - - 12 72 7 Tuesday - - 12 84 Wednesday 600 1800 Thursday 600 1800 Friday - - Saturday - - Sunday - - 8 Monday 1800 600 12 96 9 Tuesday 1800 600 12 108 10 Wednesday - - 12 120 11 Thursday - - 12 132 12 Friday 600 1800 12 144 Saturday 600 1800 Sunday 600 1800 13 Monday - - 12 156 14 Tuesday - - 12 168 Wednesday 1800 600 Thursday 1800 600 Friday - - Saturday - - Sunday - -

17 Under Mr Davis's old rostering arrangement the Sunday shifts, worked by him, fell within the first 152 hours in each roster cycle. 18 "Overtime" hours were worked (as to six hours in each) in shifts 13 and 14. These two six hour periods were paid as overtime. 19 After 31 October 2016, Wilson Security varied the roster such that the overtime hours, formerly allocated to shifts 13 and 14 were transferred to shifts 5 and 12 which fell on Sundays. Wilson Security thereupon ceased to pay the overtime penalty in respect to part of those shifts because they already attracted the Sunday loading.

RELEVANT CLAUSES OF THE AWARD 20 The Award provisions of present relevance appear in Part 5 which is entitled "Hours of Work and Related Matters". 21 Clause 21 deals with ordinary hours and shift rosters. Relevantly it provides: 21. Ordinary hours of work and rostering 21.1 Ordinary hours and roster cycles (a) The ordinary hours of work are 38 hours per week, or where the employer choses to operate a roster, an average of 38 hours per week to be worked on one or more of the following bases at the discretion of the employer: (i) 76 hours within a roster cycle not exceeding two weeks; (ii) 114 hours within a roster cycle not exceeding three weeks; (iii) 152 hours within a roster cycle not exceeding four weeks; or (iv) 304 hours within a roster cycle not exceeding eight weeks. (b) … 21.2 Shift duration (a) Ordinary time shifts must be limited in duration to: (i) for casual employees - a minimum of four and a maximum of 10 ordinary hours; (ii) for full-time employees - a minimum of 7.6 and a maximum of 10 ordinary hours; and (iii) for part-time employees - a minimum of one fifth of the employee's agreed weekly hours or four hours (whichever is the greater) and a maximum of 10 ordinary hours. (b) Notwithstanding clause 21.2(a), by agreement between the employer and the majority of employees concerned in a particular establishment, ordinary working hours exceeding 10 but not exceeding 12 hours per shift may be introduced subject to: (i) proper health monitoring procedures being introduced; (ii) suitable roster arrangements being made; (iii) proper supervision being provided; (iv) adequate breaks being provided ;and (v) an adequate trial or review process being implemented where 12 hour shifts are being introduced for the first time. (c) … (d) Clause 21.2(b) is not intended to prevent an employer implementing 12 hour rosters through the use of regular rostered overtime (subject to the requirements in s.62 of the Act in relation to the right of an employee to require reasonable overtime) or individual flexibility arrangements made pursuant to clause 7 - Award flexibility. 21.3 Break between successive shifts Each ordinary time shift must be separated from any subsequent ordinary time shift by a minimum break of not less than eight hours. 21.4 Long breaks (a) An employee must be given separate long breaks of continuous time off work in each roster cycle as follows: Length of roster cycle Minimum number of breaks 3 weeks 33 breaks of 2 days (48 continuous hours) 4 weeks 3 breaks of 3 days (72 continuous hours); or 4 breaks of 2 days (48 continuous hours) 8 weeks 6 breaks of 3 days (72 continuous hours);or 9 breaks of 2 days (48 continuous hours)

… 21.11 Notice of rosters Employees (other than relieving officers and casual employees) must work their ordinary hours of work in accordance with a roster for which advance notice has been given. A relieving officer or casual employee may also, at the employer's discretion, work their ordinary hours of work in accordance with a roster for which advance notice has been given. 21.12 Display of roster and notice of change of roster The employer must notify employees who work their ordinary hours in accordance with a roster of the commencing and ceasing times of their rostered hours of work either by posting the roster on a noticeboard which is conveniently located at or near the workplace or through electronic means. Such times, once notified, may not be changed without the payment of overtime, or by seven days' notice given in accordance with this clause. However, by agreement between the employer and the employee less than seven days' notice may be substituted. 22. Penalty rates 22.1 In this clause a span refers to a period or periods as follows: Span Period Day span 0600 hrs to 1800 hrs Monday to Friday (excluding hours on a day that is a public holiday) Night span 0000 hrs to 0600 hrs and 1800 hrs to 2400 hrs throughout the period from 0000 hours Monday to 2400 hours Friday (excluding hours on a day that is a public holiday) Saturday span 0000 hrs to 2400 hrs on a Saturday Sunday span 0000 hrs to 2400 hrs on a Sunday Public holiday span 0000 hrs to 2400 hrs on a public holiday

22.2 Permanent night work means work performed during a night span over the whole period of a roster cycle in which more than two thirds of the employee's ordinary shifts include ordinary hours between 0000 hrs and 0600 hrs. 22.3 Penalty rates Penalty rates apply to ordinary hours worked as follows: Hours worked during Penalty rate in addition to ordinary time rate % Night span 21.7 Night span (Permanent night work) 30 Saturday span 50 Sunday span 100 Public holiday span 150

22 Overtime is dealt with in cl 23. It provides: 23. Overtime 23.1 Reasonable overtime is provide for in the NES. 23.2 An employee must not be required to work more than 14 hours (including breaks to which the employee is entitled under this award). 23.3 Overtime rates Where an employee works overtime the employer must pay the employee the ordinary time rate for the period of overtime together with a loading as follows: For overtime worked on Loading payable in addition to ordinary time rate % Monday to Friday - first 2 hours 50 Monday to Friday - thereafter 100 Saturday - first 2 hours 50 Saturday - thereafter 100 Sunday 100 Public Holiday 150 23.4 Where a period of overtime commences on one day and continues into the following day, the portion of the period worked on each day attracts the loading applicable to that day. 23 The term "overtime" is not defined in the Award. Both sides accepted that it is to be bear its ordinary and well understood industrial meaning. Overtime hours are hours that are worked in addition to ordinary hours: see Re Steel Works Employees (Australian Iron and Steel Limited) Conciliation Committee (1941) 40 IR 445 at 460 (Cantor J); Australian Communication Exchange Ltd v Deputy Commissioner of Taxation (2003) 77 ALJR 1806 at 1820; [2003] HCA 55 at [82] (Kirby J).

SUBMISSIONS 24 Both sides sought to support their construction arguments by reference to extraneous matters. United Voice and Mr Davis argued that a finding by the Court that the revised rostering arrangements were permissible under the Award would give rise to what was said to be "an industrially repugnant result". This was because employees were entitled to be compensated both for the disutility of weekend work and for being required to work overtime. 25 Wilson Security, for its part, emphasised the competitive nature of the security industry and the low profit margins available to participants. 26 The Court's decision must, however, depend on the text and context of the Award. In the event that the proper construction of the Award is unacceptable to one or both of the parties there is always scope for an application for amendment. 27 Both parties placed reliance on decisions of industrial tribunals relating to provisions of the kind under consideration. As will be seen some of these decisions provide assistance in construing the Award. None was, however, decisive. 28 United Voice and Mr Davis contended that: It was open to an employer, under the Award, to adopt a four week roster cycle: see cl 21.1(a)(iii). Overtime penalties are payable in respect of hours above 152 hours in that four week cycle. Clauses 22 and 23 of the Award have the effect that: The first 152 hours worked in the four week roster cycle are ordinary hours; and Hours in excess of an average of 152 are overtime and payable at the overtime rates prescribed by cl 23.3. 29 Implicit in these submissions are the propositions that: The overtime hours are not worked until all 152 ordinary hours are worked in a four week period. That is, no overtime can be worked until all ordinary hours have been completed. In this sense the two sets of hours are mutually exclusive and sequential. There is, as a result, no scope for the working of, and payment for, overtime hours before all ordinary hours have been worked. It is not open to an employer to fix the rostering arrangements such that workers are prevented from being paid both weekend penalty rates and overtime during the four week cycle. 30 The question then becomes whether these implied restrictions on rostering find support in the text of the Award.

PRINCIPLES OF CONSTRUCTION 31 In dealing with the construction of awards in Kucks v CSR Limited (1996) 66 IR 182 at 184; [1996] IRCA 141 at 4-5 Madgwick J made the oft-repeated observation 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. 32 This passage was quoted with approval by two members of the High Court in Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241 at 271, 282-283; [2005] HCA 10 at [96] (Kirby J), [129]-[130] (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; [2006] FCA 813 at [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. See also: Construction, Forestry, Mining and Energy Union v John Holland Pty Ltd (2010) 186 FCR 88 at 111-113; [2010] FCAFC 90 at [90]-[92] (Logan J); United Firefighters' Union of Australia v Metropolitan Fire and Emergency Services Board (2006) 152 FCR 18 at 26; [2006] FCAFC 84 at [51]-[53] (Nicholson, Jacobson and Lander JJ).

RELATED DECISIONS OF INDUSTRIAL TRIBUNALS 33 In supporting its construction argument United Voice placed some reliance on the decision of the Full Bench of the Fair Work Commission ("the FWC") in United Voice (Qld Branch) v MSS Security Pty Ltd (2017) 266 IR 231; [2017] FWCFB 651. 34 The issue in MSS Security was whether a Commissioner had erred in finding that an enterprise agreement passed the better off overall test ("the BOOT test"): see ss 186(2)(d) and 193(1) of the FW Act. This required a comparison between the relevant Award provision and the related provisions in the agreement with a view to forming "an impressionist assessment" of whether or not employees would be better off were the agreement to be approved and become operative: see University of New South Wales (Professional Staff) Enterprise Agreement 2010 [2010] FWAA 9588 at [96]. 35 The Commissioner had approved an enterprise agreement which provided for the allocation of overtime to Sundays regardless of where in the roster those hours fell. United Voice challenged the approval on the basis that the "allocation" provision would permit the employer to avoid payment of the overtime penalties which would otherwise be payable under the Award. As a result, the union contended, the enterprise agreement did not leave employees better off overall compared to the Award and could not be approved. 36 The respondent in that proceeding, MSS Security, submitted that there was no provision of the Award which determined how or when the "averaged" hours were to be worked within the roster cycle and that there was no provision of the Award which prohibited or prevented an employer from allocating overtime within the roster cycle on any day it sought fit (see at [24]). As a result, it contended, no adverse comparison should be made between the Award and the agreement. 37 The Full Bench of the FWC accepted the union's submissions, saying: 34 Clause 21.1 of the Award prescribes that hours in excess of 304 hours over an eight week roster are treated as overtime. Clause 23.3 of the Award prescribes that when an employee works overtime, the employer must pay the employee the ordinary time rate for the period of overtime together with the following loadings: For overtime worked on Loading payable in addition to Ordinary time rate % Monday to Friday - first 2 hours 50 Monday to Friday - thereafter 100 Saturday - first 2 hours 50 Saturday - thereafter 100 Sunday 100 Public Holiday 150 35 By comparison, cl 4.3.5(a) of the Agreement provides that overtime in a 12-hour rotating roster cycle will generally be allocated to hours that fall on a Sunday: at the end of a Saturday and a Sunday day shift. The effect of cl 4.3.5 of the Agreement is that over the period of the roster, the overtime hours are assigned to Sunday work, regardless of when in the roster those hours actually fell. Therefore, no additional penalty over that which applied to Sunday work would be payable. 36 Pursuant to the Award, overtime is payable when the hours in excess of the maximum have been worked. By shifting those hours from the end of the roster, to Sundays earlier in the roster, the Agreement reduced the number of overtime hours for which loading would be payable. We are of the view that this is disadvantageous to the non-aggregated wage employees of the Respondent when compared to what these employees are offered under the Award. It follows that non-aggregated wage employees are better off under cll 21.1 and 23.3 of the Award than under cl 4.3.5 of the Agreement. 38 United Voice asserted that, the necessary, although unstated, premise of the conclusion of the Full Bench was that the "allocation" process purported to be authorised under the agreement was not available under the Award. The failure to make that point explicit demonstrated, so it was submitted, that it was self-evident, and that Wilson Security's present submissions were untenable. 39 Wilson Security, for its part, also relied on an earlier decision of the FWC. That decision was Harland v MSS Security Pty Ltd [2013] FWC 8064. This was a consent arbitration by a Commissioner under s 739 of the FW Act. One of the issues in dispute was the calculation of payments for the applicants under a roster constructed pursuant to the Award presently under consideration. 40 In dealing with this aspect of the dispute the Commissioner said that: [70] The applicants submit that they do not object to working 12 hour shifts but do object to the manner in which the respondent sets the roster so that the Sunday is a shift of 12 hours overtime. [71] This aspect of the respondent's roster minimises the wage cost to the respondent. [72] If the roster was arranged differently the 12 hours of overtime which under the respondent's roster falls on a Sunday would be spread across a number of different shifts and these overtime hours could be paid at double time and in addition the ordinary hours worked on the Sunday would also be paid at double time. [73] The applicants submit that the roster should show only 10 ordinary hours for each 12 hour shift and the balance, 2 hours, would be overtime. The applicants see the respondent's approach to rostering as reducing their wages. [74] In [Award Modernisation Decision - Decision - Full Bench] [2008] AIRCFB 1000 a Full Bench of the Commission dealing with award modernisation and in particular the making of priority modern awards specifically considered the terms of the new Security Services Industry Award 2010 [MA000016] (the Award in this matter) and the exposure draft that was available for the parties comment, and dealt with the issue of 12 hour ordinary time shifts as follows: "Ordinary hours of work and rostering [296] We have been persuaded by the submissions of ASIAL that provision should be made for 12 hour ordinary time shifts. We recognise that the security services industry operates 24 hours a day, seven days a week and that 12 hour shifts are a ubiquitous feature of the industry throughout Australia. The exposure draft provided for 12 hour shifts but only on the basis of 10 hours of ordinary time and two hours of rostered overtime. The absence of provision for 12 hour ordinary time shifts would result in increased costs to many employers and result in many employees working more overtime than they may wish to work. The pre-reform awards in NSW, Victoria and Western Australia contain facilitative clauses that allow for 12 hour ordinary time shifts to be worked by agreement with a majority of employees, as does the relevant NSW NAPSA. We have included such a clause based on the clause in the Victorian pre-reform award." (Underlining added) [75] The applicants' approach to their calculations is based on each 12 hour shift being assumed to comprise 10 ordinary hours and 2 hours overtime. It is significant that the Full Bench of the Commission at the time of making the Award expressly identified that this method of working would result in increased costs to many employers and deliberately provided for 12 hour ordinary time shifts to avoid this cost impost on employers and the Full Bench recognised that amongst others the Western Australian pre-reform award provided for 12 hour ordinary time shifts already. [76] The Roster design in any workplace is at the discretion of the employer subject to the Award requirements. [77] There is nothing inappropriate in the respondent designing its rosters to minimise its costs as the Full Bench has clearly recognised. In terms of the respondent's approach to rostering ordinary hours and consequently where overtime hours fall in that roster, I am satisfied the respondent is entitled to operate under the roster it has designed in this case. [78] The rostering approach of the respondent is consistent with the terms of the Award. There is nothing in the Award that prohibits Sunday shifts being 12 hours of overtime. I am satisfied that the respondent's calculations, in terms of ordinary hours and overtime under their roster, meet the requirements of the Award. 41 Harland was referred to in argument before the Full Bench in MSS Security. The Full Bench's reasons record (at [13]-[14]) that United Voice, in that case, had advanced a number of arguments in support of the proposition that Harland was distinguishable. When, however, the Full Bench came to the section of its reasons headed "Consideration" (in which the quoted paragraphs [34]-[36]) appear no mention is made of Harland or of the arguments advanced suggesting that it was distinguishable. It is also notable that the Full Bench in MSS Security did not engage with MSS's submissions, based on Harland and what the Full Bench had said in the Award Modernisation Decision - Decision - Full Bench [2008] AIRCFB 1000, about the provisions of the Award dealing with rostering and overtime payments. 42 Another earlier decision of the former Australian Industrial Relations Commission which was of potential relevance but was not, apparently, referred to or considered by the Full Bench in MSS Security was Liquor, Hospitality and Miscellaneous Union v Chubb Security Australia Limited [2009] AIRC 4. This was a private arbitration about the same issue which arises the present case. It dealt with equivalent provisions under the forerunner of the present Award, the Security Employees (ACT) Award 1996. The union had complained that rostering overtime on Sunday shifts throughout the cycle was in breach of the Award and a related agreement and that overtime should be paid only on the last 32 hours of a 336 hour roster cycle, regardless of the days of which those 32 hours fell. 43 The Senior Deputy President who conducted the private arbitration rejected this submission. He said: [11] Chubb has adopted the practice of rostering specific Sunday shifts as scheduled overtime throughout rotating 12 hours rosters since the introduction of 12 hour shifts in the ACT … Over the eight week cycle, guards work exactly the same shifts as each other, but at different times through the cycle. Over the cycle, the guards will work either three 12 hour shifts or four 12 hour shifts per week. This averages out to 42 hours per week. In a 12 hour rotating roster, each guard is rostered to work 336 hours over an eight week period. 304 hours are rostered as ordinary hours and 32 hours as overtime hours. The overtime hours are rostered on two Sunday shifts and eight hours of a Saturday night/Sunday morning shift. Each guard is rostered to work each of the overtime shifts once during the eight week cycle. The overtime shifts occur at specific instances in the eight week roster period. … [12] Rostering overtime in this way is the most effective arrangement for Chubb. Mr Myers gave evidence that rostering and paying overtime in the manner sought by LHMU would increase Chubb's costs of operating the 12 hour roster system by approximately 4% … … [18] On the basis of the evidence, I find the following facts form part of the relevant circumstances within which the overtime provisions of the 2004 agreement should be construed. • There is a long-standing and well recognized practice by many companies in the security industry to ensure, where services are provided on a seven days a week basis, that overtime falls on Sunday; • This is done to minimize costs as the ordinary and overtime rates on Sundays are effectively the same; • … [19] All these considerations support a construction of the agreement that permits the allocation of overtime to Sundays over the course of the roster cycle. 44 None of these decisions is, of course, binding on the Court. They do, however, provide assistance in understanding the long and ongoing discord between unions and employers about the proper construction and application of the Award.

CONSIDERATION 45 The issue raised by the present application is more concerned with what are said to be implied limitations on the application of certain provisions of the Award than with the verbiage of the Award itself. 46 There may well be cases in which it is appropriate to read in words of limitation in an award. Such may be the case where, for example, there has been an established and mutually agreed understanding of the manner in which certain provisions will operate. 47 This is not such a case. The decisions of the FWC and its predecessor, to which reference has been made, establish that the construction issues involved in this case have been agitated for over the past decade without definitive resolution. Conflicting views have been expressed by members of industrial tribunals who have been called on to adjudicate in these ongoing disputes. 48 It is very difficult to read the decision in MSS Security as supporting the existence of an unstated premise that employers were precluded, by the Award, from allocating overtime hours to shift periods prior to the worker's completion of the full complement of ordinary hours. This is so, particularly, when it is borne in mind that the Full Bench: Did not, in its reasons, deal with the construction issues presently under consideration, despite them having been specifically raised by the respondent MSS Security. Made no reference to authorities relating to the principles of award construction. Failed to distinguish or overrule Harland. Did not refer to Chubb Security and the observations of the Full Bench in the Award Modernisation Decision. 49 The Award provides for ordinary hours (that is, 38 hours per week) to be averaged over two, three, four or eight week roster cycles "at the discretion of the employer": cl 21.1(a). It also provides for additional payments for the working of overtime hours: cl 23.3. 50 Rostering arrangements are within the discretion of the employer. Consistently with the existence of this discretion the Award does not contain any express restrictions on the exercise of that power. In particular it is open to an employer: to choose the day on which a roster is to begin; to decide whether overtime hours can be included in the roster at a point before which all ordinary hours have been worked; to decide on the number of days on which ordinary hours can be worked; and to fix the number of days of the week on which ordinary hours are to be worked (subject to the limitations prescribed by cls 21.3 and 21.4). 51 Absent such express restrictions, the ordinary and natural language of the Award, in my view, permits an employer to act in the manner in which the respondent has done in the present case. 52 The language employed by the draftsman of the Award does not compel the reading in of the kind of restrictions contended for by United Voice. Nor is this rendered necessary in order to ensure the effective operation of the Award provisions. Decisions of industrial tribunals of long standing have favoured contrary constructions. The catalyst for the present application would appear to have been the more recent decision in MSS Security. For the reasons explained above at [48] I do not consider that that decision assists United Voice's construction arguments in the present proceeding. What these conflicting decisions highlight is the absence of any clearly understood and mutually accepted understanding of the operation of the rostering provisions and the allocation of overtime to Sundays. Given these circumstances it is all the harder to support the implication of terms in the Award which do not appear. 53 The Court should be hesitant to read in restrictions in an award which, if not complied with, might give rise to penal consequences under the FW Act. 54 The constructional dispute is, as I have already observed, one of long standing. Throughout that period it has been open to either party to apply to the FWC for an amendment to the Award to make it clear, one way or another, whether or not employers should be restricted in the manner contended for by United Voice. That option remains open.

DISPOSITION 55 The application must be dismissed. I certify that the preceding fifty-five (55) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Tracey.