The Industrial Appeal Court has upheld an appeal against a decision of the Full Bench of the Commission and found that The Shop and Warehouse (Wholesale and Retail Establishments) State Award 1977 (the Award) remains applicable to workers and employers in the retail pharmacy industry.

Background

When the Award issued in 1977, the inclusion of a number of retail pharmacies as respondents to the Award meant that the retail pharmacy industry was captured within the scope of award coverage.

In 1995, the Commission struck out the name of the last then remaining retail pharmacy industry participant under s 47(2) of the Industrial Relations Act 1979 (WA) (the Act) and replaced the schedule to the Award with a fresh list of scheduled employers. None of the employers in the replaced schedule were engaged in the retail pharmacy industry.

At first instance

The Shop Distributive and Allied Employees’ Association of Western Australia applied to the Commission and sought a declaration under s 46(1)(a) of the IR Act to the effect that the Award applied to workers and employers in the retail pharmacy industry.

Commissioner Emmanuel heard the application and made a declaration that the Award applied to the retail pharmacy industry in WA. She found that, where the scope of an award is to be varied, certain steps are required to occur under s 29A of the Act. No evidence or argument were put that those steps occurred.

Emmanuel C also found that the Commission exercises a ‘special power’ when removing a listed respondent that no longer carries on business in an industry to which the award applies. She found that such an order does not have the effect of removing an industry, thereby reducing the award’s scope.

The Pharmacy Guild of Western Australia and Samuel Gance t/as Chemist Warehouse appealed this decision.

Appeal to the Full Bench

By majority, Chief Commissioner Scott and Senior Commissioner Kenner upheld the appeal and found that the Award had ceased to cover workers and employers in the retail pharmacy industry during 1995.

The majority concluded that the requirements of s 29(A)(2) of the Act were not applicable to the striking out order issued by the Commission in 1995 under s 47(2) of the Act, as they found that the application to remove the named respondents from the Award was made by the Commission acting on its own motion.

The majority also found that the removal of the last-named respondent engaged in the retail pharmacy industry in 1995 had the effect of removing that industry from the scope of the Award at that time.

Appeal to the IAC

Justice Kenneth Martin rejected the conclusion expressed by the majority of the Full Bench that the removal of the last-named respondent of the retail pharmacy industry to the Award ‘had the effect of removing that industry from the scope of the Award from that time’.

Kenneth Martin J found that the Full Bench majority misread s 47(2) of the IR Act beyond its proper context and determined that it was not a stand-alone variation power that enabled the Commission to act of its own motion to impact against the scope of an award.

His Honour determined that s 47 provides the power to strike out a party as a named party to an award but does not change the scope of application of the award. His Honour rejected the Full Bench majority’s approach that a reduction in scope outcome is the necessary and logical legal consequence of the Award’s adoption of a Glover clause.

A Glover clause is a drafting technique that expressed an award’s coverage as being applicable to all workers within an industry or industries that were then the industries of the schedules respondents to the award.    

Kenneth Martin J found that a variation in the scope of an award must first need to be meticulously progressed through onerous publication, notification and service requirements under s 29A(2) of the Act. His Honour found that these requirements were not met in 1995 and, consequently, the Commission never obtained jurisdiction to validly issue an order that could vary the scope of the Award.

Conclusion

The appeal was allowed.

The Shop and Warehouse (Wholesale and Retail Establishments) State Award 1977 remains applicable to workers employed in any calling or callings as mentioned in the retail pharmacy industry and to employers employing those workers.

The decision can be read here.