THE OBJECT AND PURPOSE OF CLAUSE 41
14 The principles to be applied in construing an industrial agreement were not put in issue on the appeal. Nor was the object and purpose of redundancy provisions generally put in issue.
15 What was said to be in issue was the correct construction of the particular terms of cl 41 and its application to the facts.
16 At a very general level it was thus common ground that the words used in an agreement are to be given their "natural and ordinary meaning": cf. City of Wanneroo v Holmes (1989) 30 IR 362 at 378 per French J (as his Honour then was). See also: BHP Billiton Iron Ore Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union of Workers (Western Australian Branch) [2006] WASCA 124 at [20]-[21], 153 IR 397 at 401-402 per Pullin J (Wheeler and Roberts-Smith JJ agreeing). Any other approach, it has been said, "would lead to industrial anarchy": Norwest Beef Industries Limited v Australian Meat Industry Employees Union of Workers (WA Branch) (1984) 12 IR 314 at 331 per Olney J. "If the words of an award have an unambiguous meaning, then that is the meaning that should be ascribed to them and there is no need for the court to consider the expressed or supposed intention of the drafters of the award": Manildra Flour Mills (Manufacturing) Pty Ltd v National Union of Workers [2012] FCA 1010 at [50] per Cowdroy J. See: Boncardo, 'Enterprise Agreements and Contracts: Convergent and Divergent Approaches To Interpretation' (2011) 18 JCULR 56 at 60-63.
17 The terms of industrial agreements, it was also accepted, are to be understood in the industrial context in which they appear: AMCOR Limited v Construction, Forestry, Mining and Energy Union [2005] HCA 10, 222 CLR 241. Gleeson CJ and McHugh J there observed:
[2] The resolution of the issue turns upon the language of the particular agreement, understood in the light of its industrial context and purpose, and the nature of the particular reorganisation. There is nothing inherent in the idea of redundancy that justifies an expectation either that redundancy payments will, or that they will not, become payable in the event of a reconstruction, merger, or takeover …
Redundancy payments were there sought pursuant to cl 55 of the Australian Paper/Amcor Fibre Packaging Agreement 1997. Gummow, Hayne and Heydon JJ there also similarly observed:
[30] Clause 55.1.1 must be read in context. It is necessary, therefore, to have regard not only to the text of cl 55.1.1, but also to a number of other matters: first, the other provisions made by cl 55; secondly, the text and operation of the Agreement both as a whole and by reference to other particular provisions made by it; and, thirdly, the legislative background against which the Agreement was made and in which it was to operate.
Kirby J there said of the Agreement there under consideration that it:
[94] … bears the common hallmarks of colloquial language and a measure of imprecision. Doubtless this is a result of the background of the drafters, the circumstances and possibly the urging of the preparation, the process of negotiation and the omission to hammer out every detail - including possibly because such an endeavour would endanger the accord necessary to consensus and certification by the Commission.
His Honour continued:
[96] The nature of the document, the manner of its expression, the context in which it operated and the industrial purpose it served combine to suggest that the construction to be given to cl 55.1.1 should not be a strict one but one that contributes to a sensible industrial outcome such as should be attributed to the parties who negotiated and executed the Agreement. Approaching the interpretation of the clause in that way accords with the proper way, adopted by this Court, of interpreting industrial instruments and especially certified agreements. I agree with the following passage in the reasons of Madgwick J in Kucks v CSR Ltd [(1996) 66 IR 182 at 184], where his Honour observed:
"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."
See also: Shop Distributive and Allied Employees' Association v Woolworths SA Pty Ltd [2011] FCAFC 67 at [14]-[18] per Marshall, Tracey and Flick JJ; Public Service Association (SA) Inc v South Australia [2012] SASCFC 66 at [32] to [38], 113 SASR 49 at 57-58 per Stanley J (Doyle CJ and Vanstone J agreeing).
18 The "industrial heritage" of the present Collective Agreement, it was further accepted, was to be found in the Sydney Light Rail (State) Award 1997 - an award of the Industrial Relations Commission of New South Wales. It was further accepted that provisions such as cl 41 could be traced back to the Termination, Change and Redundancy Case (1984) 8 IR 34 and the Termination, Change and Redundancy Case (Supplementary Decision) (1984) 9 IR 115.
19 In AMCOR Limited, Gummow, Hayne and Heydon JJ set forth the "Legislative background" to such redundancy provisions as follows:
The legislative background - awards and redundancy
[42] In 1981, the Australian Council of Trade Unions made claims that led, ultimately, to the making of awards providing terms governing the termination of employment, providing for consultation about major changes likely to have significant effects on employees, and providing for terms governing what was to happen in cases of redundancy. The Commission first published reasons determining issues of principle. Having heard further submissions from the parties, the Commission then published a supplementary decision in which it settled the form of order to be made.
[43] The Commission said, in its supplementary decision, that it had "some difficulty in finding a suitable expression" to make its intention clear about what constituted "redundancy". In its earlier decision, it had referred to a number of definitions of redundancy. Chief among those was the decision by Bray CJ in R v Industrial Commission (SA); Ex parte Adelaide Milk Supply Co-operative Ltd [(1977) 16 SASR 6 at 8] which was understood [(1984) 8 IR 34 at 56] as emphasising that redundancy refers "to a job becoming redundant and not to a worker becoming redundant".
[44] For present purposes, what is important is that the Commission appears to have been seeking a form of words that would accommodate two features. First, as was said in the Commission's supplementary decision [(1984) 9 IR 115 at 128], it "did not intend the redundancy provisions to apply where an employee is dismissed for reasons relating to his/her performance, or where termination is due to a normal feature of a business". Secondly, the Commission did not intend redundancy provisions to be engaged by the transmission of a business. In its earlier decision, the Commission had emphasised that it did "not envisage severance payments being made in cases of succession, assignment or transmission of a business". That is, the Commission regarded termination of employment by a particular employer as not sufficient to engage the redundancy obligations, even if that employer was ceasing any participation in the particular business. The focus of the provision was upon the work undertaken by the employee (the "job"), not upon the identity of either the employee or the employer. The relevant inquiry was whether employment in a particular kind of work then being undertaken was to come to an end. If that employment was to come to an end, it was necessary to consider why that was to happen. Was it because the employer no longer wanted the job, then being done by the employee, done by anyone? Or was it "due to the ordinary and customary turnover of labour"? And, as the Commission's evident concerns about drafting show, these alternatives were not, and are not to be, understood as exhausting the cases that might have to be considered.
20 The terms of cl 41, it was thus accepted, were to be construed largely by reference to the terms used in the clause itself, the object and purpose of such provisions, the Collective Agreement as a whole and the "industrial heritage" from which such provisions emerged.