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[2021] FWC 3656
General information, not legal advice.
Fair Work Commission
2021-06-29
Original judgment source is linked above.
s.739 - Dispute resolution
Application to deal with a dispute in accordance with a procedure in an enterprise agreement.
[1] This decision relates to an application made under section 739 of the Fair Work Act 2009 (Cth) (Act) and the dispute resolution procedure at clause 35 of the Metcash IGA Distribution Victoria Enterprise Agreement 2019[1] (Agreement).
[2] The Agreement is expressed as "binding on": Metcash Trading Limited (Metcash); the National Union of Workers (now the United Worker's Union (UWU)), also noted in the approval decision as "covered"); and all persons employed by Metcash at its premises in Laverton, Victoria in the occupations of freezing or refrigerating goods of any kind for the purpose of trade or sale including the packing, sorting and distribution thereof (Employees).[2]
[3] Essentially, the dispute is about whether a group of Employees working at Metcash's Laverton Distribution Centre should be paid an afternoon shift loading (of 20%) under subclause 8.1 of the Agreement.
[4] It is not contentious and I am satisfied that: the Agreement covers and applies to the Employees in their work for Metcash at its Laverton Distribution Centre; and the pre-requisites of clause 35 of the Agreement have been followed, such that there is jurisdiction to resolve the dispute by way of arbitration pursuant to s.739 of the Act and the agreement of the parties in accordance with the term at clause 35 of the Agreement.
[5] The UWU and Metcash agreed that the Commission should determine the following question in resolution of the dispute:
On the proper construction of the Metcash IGA Distribution Victoria Enterprise Agreement 2019 (the Agreement), whether employees who are the subject of the dispute are entitled to be paid an afternoon shift allowance pursuant to clause 8 of the Agreement?
[6] The provisions of the Agreement primarily subject of the dispute live within clauses 6 -Hours of Work and 8 - Shift Work. These provisions are extracted in full at Attachment A to this decision. Other provisions are referred to where relevant throughout.
[7] The parties agreed that there is a typographical error at subclause 6.1.2 such that the cross-reference to "subclause 8.2" should be "subclause 9.1", and the correct cross-reference is adopted throughout.
[8] The following facts are not contentious and/or were not challenged in evidence:
a) The Employees subject of the dispute work in the cold storage area (packing sorting and distributing frozen and refrigerated goods at the perishables warehouse) of the Laverton Distribution Centre and each commenced employment after 11 May 1998 (Affected Employees).[4]
b) The hours of Affected Employees are arranged across 4 shifts each week: commencing at 0945 hours and concluding at 1945 hours, inclusive of break times.[5]
d) Affected Employees also receive a 5 minute "wind down break", to wash up after finishing their work, taken at 1925 to 1930 hours (clause 21 - Wind Down).[6]
e) The second 15 minute rest break is then taken, from 1930 to 1945 hours. Affected Employees leave (or commence leaving) the Laverton Distribution Centre at 1930.[7]
f) The Affected Employees are classified by Metcash as dayshift workers and are paid ordinary rates for 9.5 hours per shift (38 ordinary hours per week).[8]
[9] The UWU contends that the relevant parts of the Agreement are not ambiguous and should be interpreted based on their plain meaning, without admission of surrounding circumstances. It argues that working afternoon shift is the only criteria that must be met in order to engage the entitlement to afternoon shift loading at subclause 8.1.2 of the Agreement. It says the Affected Employees' shift finishes at 1945 hours, which is after 1800 hours and before 0100 hours, and therefore they are afternoon shift workers as defined at subclause 8.1(a). The UWU acknowledges there is an exception in the definition of "Afternoon Shift" at subclause 8.1(a) of the Agreement, if the Affected Employees are "on dayshift work in accordance with clause 6", but argues that this exception does not apply unless an Employee who commenced after 11 May 1998 concludes their ordinary hours at or before 1930 hours. It says the conclusion of their shift at 1945 means they do not work ordinary hours between 0600 and 1930 as subclause 6.1.2 requires.
[10] In contending that the second paid rest break constitutes ordinary hours of work, the UWU pointed to the undisputed facts about payment. Specifically, that the second rest break (for the period 1930 to 1945 hours) is paid by Metcash and the Agreement requires 4 x 9.5 ordinary hours shifts per week which is paid by Metcash but is a requirement that could not be met if the second rest break is excluded from ordinary hours. It further highlighted an "absurd" consequence if the second break is not counted as ordinary hours worked in that annual and other leave accruals are based on the number of ordinary hours the Employees' work.
[11] The UWU also argued that the words "counted as time worked" in the rest period provision at clause 23 of Storage Services and Wholesale Award 2010 (Award) are to be read "in conjunction with" the disputed term of the Agreement pursuant to clause 4 of the Agreement. The UWU submitted there is no inconsistency between the terms in this respect because clause 20 (Rest Period) of the Agreement is silent as to whether such rest period is to be counted as time worked.
[12] Metcash submits that the Employees are not performing "work" during the period 1930 to 1945 hours and that period is not part of their "hours of work". It contends that, once that conclusion is reached, it is apparent that the Affected Employees are working "dayshift" (not "Afternoon Shift"). Metcash urges the Commission to find that the textual meaning of the relevant provisions, having regard to the context of the Agreement as a whole, points to such conclusion for reasons which are detailed in its submissions, summarised in the following 5 points:
The Agreement expressly provides when particular "down time" is to be counted as time "worked", as is evident from clause 21 (Wind Down) (which so provides, in contrast to clauses 19 (Meal Break) and 20 (Rest Period)).
Payment or non-payment of "down time" is not relevant to whether it is to be regarded as time worked or working time, which can be seen from clause 22 - Waiting Time.
The grouping of the series of "down time" clauses of the Agreement (clauses 19, 20, 21 and 22) and their proximity to each other accentuates the contrast between clause 21 from the others and strengthens the submission that the down time provided by clause 21 was to be treated as "time worked" whereas the down time provided by clauses 19, 20 and 22 was not (irrespective of the payment consequences).
A comparison of subclauses 19.1 and 20.1 supports the contention that the paid rest breaks cannot be regarded as working time because, in essence, there is no financial consequence or penalty for working during the paid rest breaks - the Agreement effectively prohibits work during this period.
As a matter of fact, none of the Employees perform any work during the second rest break nor are they expected, required or directed to perform any work in that period. The UWU's construction requires acceptance of the proposition that the Affected Employees, employed "in the occupations of freezing or refrigerating goods" (including by packing, sorting and distributing) at the Laverton Distribution Centre were "working" in those occupations at a time when they are not even present at the Laverton Distribution Centre.
[13] The principles that apply to the interpretation of an enterprise agreement were summarised by a Full Bench of the Commission in AMWU v Berri Pty Ltd,[9] drawing on the earlier Full Bench decision in AMIEU v Golden Cockerel Pty Ltd.[10] The Full Bench in Berri affirmed that the interpretation of an enterprise agreement, like that of a statute or contract, begins with a consideration of the ordinary meaning of the relevant words. The resolution of a dispute over the interpretation of an enterprise agreement will turn on the language of the agreement, having regard to its context and purpose. Context might appear from the text of the agreement as a whole, the place and arrangement of the disputed provision in the agreement, and the legislative framework under which the agreement was made.[11]
[14] The Question is whether, on a proper construction of the Agreement, the employees who are subject of this dispute (earlier defined as the Affected Employees) are entitled to be paid an afternoon shift allowance pursuant to clause 8 of the Agreement.
[15] Clause 8 provides for shift work. Under subclause 8.1, Metcash "may require any employee to perform his or her work in shifts, Monday to Friday worked as 4 x 9.5 hour days". "Afternoon Shift" is then defined at subclause 8.1(a) to mean "..any shift finishing after 1800 and at or before 0100 except where employees on dayshift work in accordance with clause 6".
[16] Clause 6 provides for hours of work. Under subclause 6.1, the "ordinary hours of work for day workers shall be an average of 38-hours per week, to be worked by means of 4 x 9.5-hour days: ...". The colon indicates that the introductory words at subclause 6.1 are to be read with the following subclauses. Relevantly, subclause 6.1.2, such that these "ordinary hours of work for day workers" are "..to be worked as 4 x 9.5 hours days: .. Between the hours of 0600 and 1930 Monday to Saturday in accordance with subclause [9.1] by new employees employed after 11 May 1998". The subclause referenced is to the work rosters at subclause 9.1 (within clause 9 - Work Rosters), relevantly:
0600 to 1930 Monday to Friday Day Shift (6 Day Roster)
[17] The shifts of Affected Employees span the hours of 0945 to 1945. During this span, Affected Employees are entitled to a 30 minute unpaid meal break (clause 19 (Meal Break)) plus two paid 15 minute breaks (clause 20 (Rest Period)). The second of the paid 15 minute breaks is to be taken "at the end of the ordinary hours of work for the day".
[18] The competing contentions focus, in my view correctly, on a central issue: whether, on a proper construction of the Agreement, the second 15 minute paid rest break is regarded as working time or working hours. If the answer is:
"yes", as the UWU contends, then the Affected Employees are shiftworkers working an afternoon shift and should be paid a 20% loading pursuant to subclause 8.2; or
"no", as Metcash contends, then the Affected Employees are working dayshift work within the exception at subclause 8.1(a) and are not entitled to any afternoon shift loading.
[19] The Affected Employees in fact commence work at 0945 each day. During the course of the shift, they take the first 15 minute paid break, then the 30 minute unpaid meal break, then a wind down break to wash up etc at 1925 to 1930 and then the second paid 15 minute break at 1930 to 1945. From 1930, the Affected Employees are not required to remain at, and in fact, commence departure and depart the Laverton Distribution Centre.
[20] There is no dispute that the Affected Employees are in fact paid at the rate of 38 ordinary hours per week under the Agreement. The Affected Employees' shift of 0945 to 1945 hours spans a total period of 10 hours. It is also not contentious that the 30 minute unpaid meal break is not counted as time worked or ordinary hours and the shift hours equate to 9.5 hours per day x 4 days per week (38 hours per week) if the 30 minute unpaid meal break is deducted but the two paid 15 minute breaks are counted.
[21] That Metcash pays the Affected Employees for 38 ordinary hours per week including the two paid 15 minute breaks per day is not, in my view, determinative or conclusive of whether these breaks are to be treated as working time when regard is had to the text of the Agreement as a whole. To the contrary, by subclause 23.1 of the Agreement (within clause 23 - Minimum Hours of Work), Metcash is required to either give or pay the Affected Employees required to work on any day within the hours set out in clauses 6 (Hours of Work), 7 (Types of Employment and Related Matters) and 8 (Shift Work) of the Agreement the minimum number of hours normally worked on such day in accordance with clause 7 (9.5 hours per day and an average of 38 ordinary hours per week). The obligation is therefore for Metcash to pay at the rate of 38 ordinary hours per week, regardless of whether it requires employees to work 38 ordinary hours per week.
[22] In contrast, the distinction in the Agreement between an "afternoon shift" and "dayshift" worker, for the purposes of clause 8 and the exception under clause 6, turns on the commencing and finishing times in relation to performance of work and hours worked.
[23] The two 15 minute paid rest breaks are provided for at clause 20 (Rest Periods). This is plainly expressed as a "paid" entitlement to a "break". Subclause 20.1 provides that the first 15 minute paid break to which an Employee is entitled is "between the commencement of ordinary hours of work for the day and the designated meal break" and the second is "at the end of the ordinary hours of work for the day". In my view, the words "at the end of" designate the point in time at which the break is to be taken and neither this expression, nor anything in the express drafting of clause 20 of the Agreement, provides that these breaks are to be regarded as work or time worked for the purposes of the shiftwork provisions or otherwise.
[24] The general legal principle was enunciated by the High Court of Australia in R v Galvin; Ex parte Metal Trades Employers' Association as follows:
[...] During a non-working period, the employees are not subject to the control of the employer in relation to the work for doing which they are employed. An hour during which no work is to be done cannot be called an hour of work. So also a shorter period during which no work is to be done is not part of "hours of work". Thus a luncheon interval is not a period of work. [...][12]
[25] The parties properly acknowledged that an enterprise agreement may be struck to reflect a different intention and so this principle only takes matters so far. Similarly, it was acknowledged that the findings in AMWU v Downer EDI Engineering Power Pty Ltd[13] are not determinative as although the second "afternoon commute" break in that case was analogous to the second 15 minute break in this case, that case turned on the particular drafting of a different enterprise agreement with different context.
[26] Metcash pointed to the absence of the phrase "to be counted as time worked" at clause 20, being a phrase found elsewhere in the Agreement and in the incorporated Award. I accept that this phrase was within contemplation of the drafters but do not regard its absence in clause 20 as of interpretative assistance, when these provisions are viewed in their proper context. Clause 21 (Wind Down) provides that 5 minutes of paid "wind down time" (a period all Employees shall be allowed "at the end of the day's work" to wash up and prepare to finish work) is "to be counted as time worked". But clause 21 does not otherwise provide for payment of the "wind down time" and in this context the phrase is relevant to establishing the payment obligation for such time. The Award, to the extent it is part of the admissible statutory and industrial context, also includes provision for paid meal breaks at clause 23 (Rest Period). Again, in that particular context, the words "such rest break is to be counted as time worked" reflects no more than an obligation that the rest break be paid.
[27] I do not accept the Union's contention that these words from the equivalent term at clause 23 of the Award should effectively be read into clause 20 of the Agreement. By providing at clause 20 of the Agreement for a rest break with differently expressed duration of the break and times at which the rest break is to be taken, and by expressing the payment obligation in different language there is a direct inconsistency between the term of the Agreement and the Award term. Pursuant to clause 4.1 of the Agreement, the provision at clause 20 prevails to the extent of the inconsistency. It follows that clause 23 of the incorporated Award may not be read into clause 20 to effectively supplement the drafting in this respect.
[28] I accept that, other than perhaps the exception of overtime (subject to the specific provisions of clause 11 - Overtime), the Agreement does not contemplate financial penalty for or indeed permit work to be required to be performed during the second paid 15 minute break and it does not logically follow that a time in which work is prohibited would be regarded as time worked or work.
[29] There is also some textual support for the proposition that payment is not necessarily indicative of the calculation of working time and in this respect Metcash's contentions about clause 22 (Waiting Time) are persuasive.
[30] Finally, there was some conjecture in oral submissions about the purpose and use of the 5 minute down time from 1925 to 1930 but it was not disputed that Affected Employees are released from duty and either depart or commence departing the workplace from 1930 hours (other than where there is a separate request to work overtime, which is outside the scope of this dispute). This fact is crucial in the context of the words of this particular Agreement. No Affected Employee is required or directed to perform any ordinary hours of work after 1930 hours. No Affected Employee does perform work after 1930 (other than overtime). Whilst the shift might be scheduled to finish at 1945, when viewed in context, the time from 1930 to 1945 can not be considered time worked or work as there is no performance of any work or even attendance in the workplace during this time.
[31] For completeness, the expression of leave accruals at clauses 15 and 16 (Annual Leave and Personal/carer's Leave, respectively) by reference to "the number of ordinary hours they work" and "ordinary hours worked" appear in a particular context and it may be observed are part of a matrix of obligations including payment at the "employee's applicable ordinary rate" (and, in the case of annual leave, plus a loading). These terms have a specific industrial meaning, and indeed the National Employment Standards will prevail to the extent of any inconsistency pursuant to clause 4 of the Agreement. I do not consider that the wording of these terms in the Agreement aides in the construction of the disputed clause and I otherwise make no finding in this respect.
[32] In the present matter, I have had regard to the text of the Agreement as a whole, the disputed provision's place and arrangement in the Agreement, the legislative context and the objective facts as admissible surrounding circumstances and conclude that the provisions in dispute have a plain meaning and are not ambiguous. The fact that the two parties have presented different interpretations does not mean that the provisions concerned must be ambiguous.[14] In this case, there are contentions in favour of the UWU's interpretation but I prefer Metcash's interpretation as correct.
[33] When the text of the Agreement is read as a whole, I consider the better view is that the second 15 minute paid rest break is not time worked by the Affected Employees.
[34] For the above reasons, on the facts presently before the Commission, I find that the answer to the Question posed is "no": the employees subject of the dispute (herein defined as Affected Employees) are not entitled to be paid an afternoon shift allowance pursuant to clause 8 of the Agreement.
6.1 The ordinary hours of work for day workers shall be an average of 38-hours per week, to be worked by means of 4 x 9.5-hour days:
6.1.1 Between the hours of 0600 and 1700 Monday to Friday by employees employed before 11 May 1998; and
6.1.2 Between the hours of 0600 and 1930 Monday to Saturday in accordance with subclause [9.1] by new employees employed after 11 May 1998.
6.2 If the company requires it, permanent employees will be consulted in the first instance to seek interest in volunteering to work on their rostered day off (minimum four hours) at ordinary time plus 34%.
8.1 The Company may require any employee to perform his or her work in shifts, Monday to Friday worked as 4 x 9.5 hour days.
8.1.1 Except where a higher rate of pay is provided for at clause 13 of this Agreement:
8.1.2 Payment for the ordinary hours on any afternoon shift shall be at ordinary time plus twenty per cent (20%).
8.1.3 Payment for the ordinary hours on any night shift shall be at ordinary time plus 30 per cent (30%).
8.1.4 A paid meal break of thirty minutes shall be allowed to shift workers on all shifts to be taken as near as possible in the middle of the shift.
8.1.5 The commencing and finishing times of shifts shall be fixed by the Company and shall not be altered except by one weeks' notice given by the Company.
[2] Clause 2.1 of the Agreement; see also [2020] FWCA 643 at [4].
[3] Applicant's Outline of Submissions at [5].
[4] Statement of Daniel Simonoski at [1] and [10]; Statement of Emma Addison at [8], at least one of whom is represented by the UWU in this dispute.
[5] Statement of Daniel Simonoski at [11]-[13]; Statement of Emma Addison at [9].
[6] Statement of Emma Addison at [12]-[13].
[7] Statement of Daniel Simonoski at [14]; Statement of Emma Addison at [12]-[13].
[8] Statement of Daniel Simonoski at [15]; Statement of Emma Addison at [10].
[9] [2017] FWCFB 3005 (Berri).
[10] [2014] FWCFB 7447 (Golden Cockerel).
[11] Berri at [114] and Golden Cockerel at [41].
[12] [1949] HCA 12; (1949) 77 CLR 432 at 447.
[14] National Union of Workers v CHEP Australia Limited [2018] FWC 3797 at [44].
Printed by authority of the Commonwealth Government Printer
United Workers' Union
Metcash Trading Limited [2021] FWC 3656
(1949) 77 CLR 432