WESTERN AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION

FULL BENCH

CITATION : 2008 WAIRC 00216

DELIVERED : THURSDAY, 10 APRIL 2008

FILE NO. : FBA 18 OF 2007, FBA 19 OF 2007, FBA 20 OF 2007

Appellant

-and-

Commissioner of Police

Respondent

AND

ALAN JOSEPH GORDON

Appellant

-and-

COMMISSIONER OF POLICE

Respondent

AND

JAMES MICHAEL NEVIN

Appellant

-and-

COMMISSIONER OF POLICE

Respondent

ON APPEAL FROM:

Jurisdiction : Industrial Magistrate 

Coram : P M Hogan 

Citation : 87 WAIG 3089

File No : M 47 of 2007

CatchWords:

Industrial Law (WA) – Appeal against decision of Industrial Magistrate pursuant to s84 of the Industrial Relations Act 1979 (WA) – Appellants (retired police officers) sought payment of monies owing under the Western Australian Police Industrial Agreement 2006 (the 2006 Agreement) - Appellants employed under former 2003 agreement - 2006 Agreement to replace former agreement - appellants resigned before registration of the 2006 Agreement –2006 Agreement provided for increased pay and allowances from an earlier date during which appellants were employed.

Principles of construction of industrial agreements – whether an industrial agreement extended to former employees - retrospective application of industrial agreements – equity of payment of employees at different rates

Construction of legislation – whether industrial agreements can apply to former employees – whether any distinction between awards and industrial agreements – appeals dismissed.

Legislation:

Industrial Relations Act 1979 (WA) – ss7, 39(3), 41, 41A, 43, 83, 83A(1), 84,

Police Act 1892 – s7

Police Act 1892

Salaries and Allowances Act 1975 (WA)

Result:

Appeal dismissed

Representation:

Counsel:

Appellant : Mr P Momber, by leave

Respondent : Mr R Bathurst, by leave

Solicitors:

Appellant : Peter Momber, Barristers and Solicitors

Respondent : State Solicitor for Western Australia

Case(s) referred to in reasons:

Australian Timber Workers Union v W Angliss & Co Pty Ltd (1924) 19 CAR 172

Barrass v State of Victoria [1999] FCA 1166

BHP Billiton Iron Ore Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union of Workers (Western Australian Branch) (2006) 153 IR 397

Chief Executive Officer, Department of Agriculture and Food v Wall and Ward, [2008] WAIRC 00079, (2008) 88 WAIG 156

City of Wanneroo v Holmes (1989) 30 IR 362

Corlett Bros Pty Ltd v Transport Workers Union of Australia, WA Branch (1975) 55 WAIG 644

Department of Community Services and Others v Civil Service Association of Western Australia (Inc) (1994) 74 WAIG 1709

Director General of the Ministry for Culture and the Arts v The Civil Service Association of Western Australia Incorporated and Others (2000) 80 WAIG 453

Federated Engine Drivers’ and Firemens’ Association of Australasia v Adelaide Chemical and Fertiliser Company Limited (1920) 28 CLR 1

Geo A Bond & Co Ltd (in liq) v McKenzie [1929] AR (NSW) 498

Kenji Auto Parts Pty Ltd t/a SSS Auto Parts (WA) v Fisk (2007) 87 WAIG 328

Merchant Seamen's Guild of Australia v Sydney Steam Collier Owners and Coal Stevedores Association (1958) 1 FLR 248

Norwest Beef Industries Ltd & Anor v Australian Meat Industry Employees Union of Workers (WA Branch) (1984) 12 IR 314

Picard v John Heine & Son Ltd (1924) 35 CLR 1

Project Blue Sky Inc and Others v Australian Broadcasting Authority (1998) 194 CLR 355

R v Commonwealth Court of Conciliation and Arbitration and the Australian Tramway Employees’ Association (1920) 29 CLR 106

Re Clothing Trades Award (1950) 68 CACR 597

Robe River Iron Associates v Amalgamated Metal Workers & Shipwrights Union of Western Australia (1987) 67 WAIG 1097

Seamen's Union of Australia v Adelaide Steamship Co Ltd (1976) 46 FLR 444

Seymour v Stawell Timber Industries Pty Ltd (1985) 13 IR 289

Telegraph Newspaper Company Pty Ltd v Australian Journalists Association (1962) 3 FLR 39

Wilson v Anderson and Others (2002) 213 CLR 401

Reasons for Decision

RITTER AP:

The Appeal

1          These are three appeals pursuant to s84 of the Industrial Relations Act 1979 (WA) (the Act) against decisions of the Industrial Magistrate’s Court.  In each decision the court dismissed the claim of the appellant.

2          The appeal raises two issues.  The first is whether, as a matter of statutory construction, an “industrial agreement” as defined by the Act can extend to and bind former employees of an employer.  The second is, if it can, whether the Western Australia Police Industrial Agreement 2006 (the 2006 Agreement) applied to the appellants who were police officers employed on and after 1 July 2006 but resigned before the registration of the agreement on 18 December 2006. 

3          This is relevant because by clause 4(2)(a) of the 2006 Agreement employees were to receive payment of increased salary and allowances from 1 July 2006.  The respondent has not made these payments to the appellants because of the timing of their resignations.

The Statutory Framework

4          The Industrial Magistrate’s Court had jurisdiction over the originating claims pursuant to s83 of the Act which is as follows:

“83. Enforcement of certain instruments

(1) Subject to this Act, where a person contravenes or fails to comply with a provision of an instrument to which this section applies any of the following may apply in the prescribed manner to an industrial magistrate’s court for the enforcement of the provision —

(a) the Registrar or a deputy registrar;

(b) an industrial inspector;

(c) in the case of an award or industrial agreement, any organisation or association named as a party to it;

(d) in the case of an award, industrial agreement or order, an employer bound by it;

(e) any person on his or her own behalf who is a party to the instrument or to whom it applies;

(f) if an employee under an employer‑employee agreement is a represented person, a representative acting on his or her behalf.

(2) In this section —

“instrument to which this section applies” means —

(a) an award;

(b) an industrial agreement;

(c) an employer‑employee agreement; and

(d) an order made by the Commission, other than an order made under section 23A, 32, 44(6) or 66.

(3) An application for the enforcement of an instrument to which this section applies shall not be made otherwise than under subsection (1).

(4) On the hearing of an application under subsection (1) the industrial magistrate’s court may, by order —

(a) if the contravention or failure to comply is proved —

(i) issue a caution; or

(ii) impose such penalty as the industrial magistrate’s court thinks just but not exceeding $2 000 in the case of an employer, organisation or association and $500 in any other case;

or

(b) dismiss the application.

(5) If a contravention or failure to comply with a provision of an instrument to which this section applies is proved against a person as mentioned in subsection (4) the industrial magistrate’s court may, in addition to imposing a penalty under that subsection, make an order against the person for the purpose of preventing any further contravention or failure to comply with the provision.

(6) An order under subsection (5) —

(a) may be made subject to any terms and conditions the court thinks appropriate; and

(b) may be revoked at any time.

(7) An interim order may be made under subsection (5) pending final determination of an application under subsection (1).

(8) A person shall comply with an order made against him or her under subsection (5).”

5          Section 83A(1) of the Act generally requires the court to order an employer to pay to an employee any amount which the employee has been underpaid. 

6          Industrial agreements are provided for in Division 2B of Part II of the Act.  An industrial agreement is defined in s7 of the Act to mean “an agreement registered by the Commission under this Act as an industrial agreement”. 

7          Sections 41 and 41A of the Act provide:

“41. Industrial agreements

(1) An agreement with respect to any industrial matter or for the prevention or resolution under this Act of disputes, disagreements, or questions relating thereto may be made between an organisation or association of employees and any employer or organisation or association of employers.

(1a) An agreement may apply to a single enterprise or more than a single enterprise.

(1b) For the purposes of subsection (1a) an agreement applies to more than a single enterprise if it applies to —

(a) more than one business, project or undertaking; or

(b) the activities carried on by more than one public authority.

(2) Subject to subsection (3) and sections 41A and 49N, where the parties to an agreement referred to in subsection (1) apply to the Commission for registration of the agreement as an industrial agreement the Commission shall register the agreement as an industrial agreement.

(3) Before registering an industrial agreement the Commission may require the parties thereto to effect such variation as the Commission considers necessary or desirable for the purpose of giving clear expression to the true intention of the parties.

(4) An industrial agreement extends to and binds — 

(a) all employees who are employed — 

(i) in any calling mentioned in the industrial agreement in the industry or industries to which the industrial agreement applies; and

(ii) by an employer who is — 

(I) a party to the industrial agreement; or

(II) a member of an organisation of employers that is a party to the industrial agreement or that is a member of an association of employers that is a party to the industrial agreement;

and

(b) all employers referred to in paragraph (a)(ii),

and no other employee or employer, and its scope shall be expressly so limited in the industrial agreement.

(5) An industrial agreement shall operate — 

(a) in the area specified therein; and

(b) for the term specified therein.

(6) Notwithstanding the expiry of the term of an industrial agreement, it shall, subject to this Act, continue in force in respect of all parties thereto, except those who retire therefrom, until a new agreement or an award in substitution for the first‑mentioned agreement has been made.

(7) At any time after, or not more than 30 days before, the expiry of an industrial agreement any party thereto may file in the office of the Registrar a notice in the prescribed form signifying his intention to retire therefrom at the expiration of 30 days from the date of such filing, and such party shall on the expiration of that period cease to be a party to the agreement.

(8) When a new industrial agreement is made and registered, or an award or enterprise order is made, in substitution for an industrial agreement (“the first agreement”), the first agreement is taken to be cancelled, except to the extent that the new industrial agreement, award or order saves the provisions of the first agreement.

(9) To the extent that an industrial agreement is contrary to or inconsistent with an award, the industrial agreement prevails unless the agreement expressly provides otherwise.

41A. Registration of industrial agreement

(1) The Commission shall not under section 41 register an agreement as an industrial agreement unless the agreement —

(a) specifies a nominal expiry date that is no later than 3 years after the date on which the agreement will come into operation;

(b) includes any provision specified in relation to that agreement by an order referred to in section 42G; and

(c) includes an estimate of the number of employees who will be bound by the agreement upon registration.

(2) The Commission shall not under section 41 register an agreement as an industrial agreement to which an organisation or association of employees is a party, unless the employees who will be bound by the agreement upon registration are members of, or eligible to be members of, that organisation or association.”

8          Sections 42 and 42A-42H of the Act are about bargaining between parties for industrial agreements.  These sections are not relevant to the appeals.

9          Section 43 of the Act provides:

“43. Power to vary, renew or cancel industrial agreement

(1) An industrial agreement may be varied, renewed, or cancelled by a subsequent agreement made by and between all the parties thereto and in so far as the agreement relates to an employer, organisation or association of employers, on the one hand, and to an organisation or association of employees, on the other hand, it may be varied, renewed or cancelled by a subsequent agreement between that employer, organisation or association of employers and that organisation or association of employees.

(2) The Commission may vary an industrial agreement for the purpose of including, omitting or varying a provision, however expressed, that authorises an employer to stand‑down an employee.

(3) An application to the Commission to vary an industrial agreement for a purpose mentioned in subsection (2) may be made by any organisation, association or employer which or who is a party to the agreement.”

Factual Background

10       Each of the appellants filed an originating claim in the Industrial Magistrate’s Court.  Attached to their claims as schedule A was a “Statement of Claim”.  Mr Pooley’s claim said he was a retired Senior Sergeant (Country Officer In-Charge) of the Western Australia Police Force.  He was appointed by the respondent under Part 1, s7 of the Police Act 1892 (WA) to be a member of the police force of Western Australia, on or about 16 June 1969.  The respondent became his employer as at 4 December 2000 pursuant to schedule 3 to the Act, inserted by the Industrial Relations Amendment Act 2000. 

11       Mr Pooley ceased employment by way of retirement on 31 July 2006.  Up to and including that time, Mr Pooley had been paid salary and allowances in accordance with the Western Australia Police Service Enterprise Agreement for Police Act Employees 2003 (the 2003 Agreement).  As set out in clause 4 of the 2003 Agreement, it was operative from 1 July 2003 to 30 June 2006.  In addition, pursuant to clause 4(4) of the 2003 Agreement, it continued in force after the expiry of its term until such time as either party withdrew from the agreement by notification in writing to the other party and to the Commission.  As stated, the 2006 Agreement was registered by the Commission on 18 December 2006.  It replaced the 2003 Agreement.

12       It was asserted that pursuant to clause 4(2)(a) of the 2006 Agreement, Mr Pooley was entitled to an adjustment, so that he was paid the salary and allowances prescribed by the 2006 Agreement for the period 1 July 2006 to 31 July 2006.  Mr Pooley’s claim was for the recovery of unpaid entitlements amounting to $10,668.54, as particularised, plus interest. 

13       There was a similar Statement of Claim attached to the originating claim of Mr Gordon.  He was a retired Senior Sergeant of the Western Australia Police Force.  He was appointed on or about 1 January 1973.  Mr Gordon ceased employment by way of retirement on 26 July 2006.  The total amount which Mr Gordon sought recovery of was $4,922.54, as particularised, plus interest. 

14       There was also a similar Statement of Claim attached to Mr Nevin’s originating claim.  Mr Nevin was a retired Sergeant (First Class) category C, of the Western Australia Police Force.  He was appointed on or about 25 March 1968.  Mr Nevin ceased employment by way of retirement on 24 August 2006.  Mr Nevin sought recovery of unpaid entitlements to the value of $4,946.92, as particularised, plus interest.

The Hearing and the 2006 Agreement

15       Each of the applications of the appellants was heard by the Industrial Magistrate on 31 October 2007.  There was little dispute about the facts.  Neither of the appellants gave evidence.  The respondent called one witness, Ms Renae Lavell, through which a number of documents were tendered.  Ms Lavell’s evidence was given over objection.  The purpose of Ms Lavell giving evidence was to explain the “background factual matrix” (T14, 15) and assist in understanding an ambiguity in the 2006 Agreement.  The ambiguity was said to be in clause 1 of the 2006 Agreement.  This was as follows:

“1.    TITLE. NAMED PARTIES AND ESTIMATED NUMBERS OF EMPLOYEES BOUND UPON

REGISTRATION OF AGREEMENT

(1) This Agreement under section 41 of the Industrial Relations Act 1979 shall be known as the Western Australia Police Industrial Agreement 2006.

(2) This Agreement replaces the Western Australia Police Service Enterprise Agreement for Police Act Employees No PSA 45 of 2003, the Western Australia Police Service Water Police Seagoing Allowance Agreement 2004 No PSAAG 17 of 2004 and the Water Police Motor Vehicle Allowance Agreement No PSAAG 13 of 2005.

(3) The named parties to this Agreement are The Western Australian Police Union of Workers, 639 Murray Street, West Perth 6005, and the Commissioner of Police, 2 Adelaide Terrace, East Perth   WA   6004.

(4) As at 1 July 2006, the number of employees subject to this Agreement totalled 5311.”

16       The asserted ambiguity was that the heading to this clause referred to an “Estimated” number of employees whereas clause 1(4) in its terms set out the total number of employees subject to the 2006 Agreement.  Ms Lavell’s evidence was said to be relevant as one argument of the appellants was based upon them being included within this number as they were employees at 1 July 2006. 

17       Apart from clause 1, clauses 4, 5 and some definitions in clause 6 were important to deciding the applications.  These clauses are:

“4. TERM

(1) This Agreement shall operate from the date of its registration to 30 June 2009.

(2) (a) Despite subclause (1), above, the Employer will pay employees the increased salary and allowances (other than the covert allowance) provided for in this Agreement as from 1 July 2006.

(b) Payment of shift allowance under clause 16 for shifts worked on or after 1 July 2006 but before the registration of this Agreement will be based on the shift definitions set out in the Western Australia Police Service Enterprise Agreement for Police Act Employees 2003. (For example, an employee who works an afternoon shift (as that term is defined in the Western Australia Police Service Enterprise Agreement for Police Act Employees 2003) after 1 July 2006 but before registration of this Agreement will be entitled to payment for that shift at the afternoon rate specified in this Agreement. This is the case irrespective of whether, under this Agreement, the shift worked would have been classified as an afternoon shift or an evening shift.)

(3) The parties shall commence negotiations for a new industrial Agreement six months prior to expiry of the Agreement.

(4) This Agreement will continue in force after the expiry of its term until such time as either party withdraws from the Agreement by notification in writing to the other party and to the Western Australian Industrial Relations Commission.

5. AREA AND SCOPE

(1) This Agreement shall extend to and bind to all Members of the Western Australia Police Force and Aboriginal Police Liaison Officers appointed under the provisions of the Police Act 1892, except those whose salaries are recommended or determined pursuant to the Salaries Allowances Act 1975 and the employer.

(2) This Agreement shall operate over the whole of the State of Western Australia and to localities outside of the State of Western Australia at which a Multi-Functional Policing Facility as specified in clause 28 of this Agreement is located or to where employees travel outside the State on work related business.

6. DEFINITIONS

…

“Employee” means any person appointed under the provisions of the Police Act 1892 as a Member of the Western Australia Police Force or as an Aboriginal Police Liaison Officer.

“Employer” means the Commissioner of Police.

…

“Member of the Police Force” means an employee appointed as such under the provisions of the Police Act 1892.

…

“WA Police” means the Western Australia Police Force (including Aboriginal Police Liaison Officers).

… ”

18       The following is a summary of Ms Lavell’s evidence.  Ms Lavell was the Acting Director of Strategic Services at the Fire and Emergency Services Authority, on secondment from WA Police.  The secondment commenced on 25 June 2007.  At WA Police, her position was as Acting Manager Employee Relations at the Workplace Relations Branch.  Ms Lavell was an industrial advisor and involved in the day to day negotiations with the WA Police Union of Workers (the Union) for the 2006 Agreement, which she drafted.  Ms Lavell explained that the negotiations that led to the 2006 Agreement commenced early that year.  The respondent received in April 2006 what she described as a log of claims, sent as a version of the 2003 Agreement marked up with new claims in red.  A copy of the draft agreement was received as an exhibit.  In this document there was no number in the clause referring to the estimated number of employees covered by the agreement but the date inserted was 1 July 2006.  Ms Lavell said that was the “expected” date of registration of the new agreement.

19       Ms Lavell explained that the April 2006 draft agreement was not acceptable to the respondent.  A response in the form of a marked up version of the April 2006 draft agreement was sent to the Union on 7 July 2006.  In that document there was also reference to the estimated number of employees to be covered by the agreement as at 1 July 2006.  Ms Lavell explained that this was included because of the requirement in the Act to set out the estimated number of employees who would be subject to the agreement.  Ms Lavell said she inserted the number of 5,311.  She received this number from a Mr Rob Boyd, the management information officer at WA Police.  Ms Lavell said the number included all sworn officers at WA Police including the Commissioner of Police, Deputy Commissioners and Assistant Commissioners whose salaries would not be covered by the agreement but determined under the Salaries and Allowances Act 1975 (WA).  The July 2006 draft agreement was also received as an exhibit.

20       The July 2006 draft agreement was not acceptable to the Union.  Accordingly, on 20 September 2006 the Union applied to the Commission for an enterprise order because negotiations between the parties did not appear to be able to reach an agreement.  That application was set for arbitration to commence on 6 December 2006.  Arbitration did not proceed however because the parties formed the view that an industrial agreement could be reached.

21       Ms Lavell explained that prior to 6 December 2006 she had been preparing for the arbitration as she was to be a witness and she was also due to fly to France on Sunday 10 December 2006.  Ms Lavell was instructed to start drafting an industrial agreement on 6 December 2006 and told it needed to be ready for filing on 11 December 2006.  Due to the short timeframe Ms Lavell used the July 2006 draft as the basis for drafting the agreement, even though the final details of the 2006 Agreement were not yet agreed. 

22       Ms Lavell was asked about the number of 5,311 employees inserted in the final version of the 2006 Agreement.  Ms Lavell said that as she had only four days to draft the agreement, she did not change the number from 5,311 because she “knew that that number there only needed to be an estimate and I simply didn’t have time to get an up to date figure.  So I left that as it was and focused on other parts of the agreement” (T18). 

23       Ms Lavell said that as part of the preparation for the hearing of the appellant’s claims, she ascertained that in November 2006 there were 5,263 police officers including the Commissioner, Deputy Commissioners and Assistant Commissioners.  A document which confirmed these figures was received as an exhibit.

24       That concluded Ms Lavell’s evidence in chief and there was no cross-examination.

25       The respondent’s counsel tendered the 2006 Agreement and also a copy of the Western Australian Government Gazette which set out the determination of the salaries and entitlements of 11 officers not covered by the 2006 Agreement.

26       Counsel for both parties made closing oral submissions.  They were supplemented by written outlines of submissions.  It is not necessary to summarise the submissions as they were referred to in the reasons of the Industrial Magistrate and to some extent repeated on appeal.

27       The Industrial Magistrate reserved her decision.

The Reasons for Decision

28       The Industrial Magistrate published her Reasons for Decision on 22 November 2007.

29       The reasons commenced with a summary of the relevant background and the quotation of clause 4 of the 2006 Agreement.

30       The Industrial Magistrate summarised the respondent’s position that employees under the 2006 Agreement were entitled, after registration on 18 December 2006, to retrospectivity from 1 July 2006 in accordance with clause 4(2).  Employees who remained in employment as at 18 December 2006 were paid these amounts.  The appellants were not so paid as the 2006 Agreement was registered after their resignations.  The Industrial Magistrate said the primary issue for resolution was whether each of the appellants were “employees” as defined in the 2006 Agreement.

31       The Industrial Magistrate summarised that counsel for the claimants relied upon the reference in clause 1(4) of the 2006 Agreement to 5,311 employees, being a figure that included each of the claimants, and also the decision of the Western Australian Industrial Appeal Court in Corlett Bros Pty Ltd v Transport Workers Union (1975) 55 WAIG 644. 

32       The Industrial Magistrate discussed clause 1(4) of the 2006 Agreement and the evidence of Ms Lavell.  Her Honour then referred to the definition of “employee” in the 2006 Agreement. 

33       The Industrial Magistrate then said: “In determining whether that definition encompasses any person who was employed as at 1 July 2006 but ceased such employment prior to 18 December 2006 one needs to examine the 2006 Industrial Agreement in its entirety”.

34       The Industrial Magistrate said Ms Lavell’s evidence required the court to “discount the submission by counsel for the claimants that because the claimants were included in that headcount the 2006 Industrial Agreement therefore extended to them”.  Her Honour said that read with clause 4(2), clause 1(4) simply confirmed that as at 1 July 2006 there were approximately 5,311 employees who would be subject to the 2006 Agreement. 

35       The Industrial Magistrate then said:

“There is nothing in the 2006 Industrial Agreement to indicate that the definition of “employee” extends to those who were employed as at 1 July 2006 but ceased their employment prior to 18 December 2006.  If it were intended that the 2006 Industrial Agreement should be operative from the date of its registration (as per clause 4(1)) but should extend to persons who had been previously members of WAPOL then one would expect clause 5(1) and the definition of “employee” to expressly so provide.  Commonsense dictates that clause 5(1) (referred to later in these reasons) and the definition section be read in terms of applying to members as at 18 December 2006.”  (emphasis in original)

36       The Industrial Magistrate next discussed Corlett.  I will refer to this case later but for present purposes it can be summarised that the Industrial Appeal Court decided that an award which was amended on 4 October 1974 to increase rates of pay effective from 22 July 1974 applied to somebody whose employment spanned June 1974 to 30 August 1974.

37       The Industrial Magistrate referred to the submission of the respondent that there was a difference between awards and industrial agreements about retrospectivity.  Her Honour said it was submitted that for awards the Commission has the power to give them retrospective effect pursuant to s39(3) of the Act.  In contrast the respondent argued an agreement between parties could only become an industrial agreement upon registration by the Commission.  The Industrial Magistrate referred to authorities cited by the respondent, being the Industrial Appeal Court decisions in Department of Community Services and Others v Civil Service Association of Western Australia (1994) 74 WAIG 1709 per Franklyn J at 1712 and Director General of the Ministry for Cultural and the Arts v The Civil Service Association of Western Australia Incorporated and Others (2000) 80 WAIG 453 per Anderson J at [38]. 

38       The Industrial Magistrate recorded the appellants’ counsel’s reply that the court had no jurisdiction to consider the validity of actions taken by the Commission.  The Industrial Magistrate accepted this but said the point did not apply to the respondent’s submissions.  The Industrial Magistrate said that in Corlett “the award that actually applied to the worker when she was working was amended retrospectively.  Here the Agreement that actually applied (the 2003 Industrial Agreement) was not amended but was replaced by a renegotiated Agreement which made specific provision as to its date of operation and retrospective payment of salary and allowances” ([26]).

39       The Industrial Magistrate quoted clause 5 of the 2006 Agreement and then said:

“As with the definition of “employee”, commonsense dictates that the members and officers referred to be those appointed as at the date of registration, rather than all members and officers appointed since the commencement of the Police Act 1892.  Such an interpretation is reinforced by section 41(4) of the Act …”  (emphasis in original)

40       The Industrial Magistrate set out a summary of her reasons under the heading “Conclusion”.  Her Honour said she was not persuaded by the submissions made by the appellants. The inclusion of the figure of 5,311 employees in clause 1(4) was clearly an estimate and could not support a conclusion that clause 4(2) extended to all officers employed at 1 July 2006.  Her Honour said the Corlett decision was about the application of retrospective amendments to an award and was of no assistance in interpreting the provisions of the 2006 Agreement ([31]). 

41       Her Honour concluded:

“The retrospectivity provided for by clause 4(2) of the Agreement clearly extends only to those caught by the definition of “employee” as at the date of registration of the 2006 Industrial Agreement.  The provisions of the Agreement itself, read together with section 41 of the Act, (along with notions of commonsense) indicate that there can be no provision in the Agreement for members and officers who had ceased their employment prior to 18 December 2006.”  ([32], emphasis in original)

The Notice of Appeal

42       Each of the appellants filed notices of appeal to the Full Bench with an attached schedule.  The schedule was in identical form except for the details specific to that appellant.  The schedule was set out in narrative form but asserted the Industrial Magistrate erred in law and fact in finding the 2006 Agreement did not apply to the appellants.

43       In summary, the errors asserted were:

(a) The Court ought to have found the appellants had a nexus with the respondent following their retirement and the retrospective effect of the 2006 Agreement entitled them to the benefit of that agreement.

(b) An error of fact in not finding the appellants were one of the respondent’s employees at all material times, as referred to in clause 1(4) of the 2006 Agreement. 

(c) An error of law in not finding that industrial agreements under s41 of the Act could have retrospective effect and that the extent of that effect was defined exclusively by the terms of the retrospective provisions. 

(d) An error of law in not finding that the clear and unambiguous terms of clauses 4 and 1 of the 2006 Agreement had a retrospective effect with the clear intention that the 2006 Agreement should apply to the appellants. 

The Submissions on Appeal

44       Both the appellants and respondent were represented by counsel who in accordance with the relevant practice direction filed an outline of written submissions.  These submissions were adopted and amplified at the hearing of the appeals.

45       In summary, the appellants’ submissions were:

(a) Industrial agreements registered under ss41 and 41A of the Act can have retrospective effect.

(b) The extent of that effect is defined exclusively by the terms of the retrospective provisions of the agreement.

(c) The Commission is not to impose any terms on the parties and is to accept the agreement for registration pursuant to s41 of the Act, subject to s41(3), under which the Commission may require any variation of the agreement it considers necessary or desirable for the purpose of giving clear expression to the true intention of the parties.

(d) It was commonplace for an award or agreement which resolved a past dispute to have a retrospective component, as here.

(e) The words in clauses 4(2)(a) and (b) of the 2006 Agreement were clear and unambiguous and gave a retrospective effect to the 2006 Agreement.

(f) This is supported by clause 1(4) in which the appellants are included in the number of employees who were subject to and entitled to the benefits of clause 4 of the 2006 Agreement.

(g) The 2006 Agreement does not expressly exclude retired employees.  This was contrasted to clause 45 of the Corruption and Crime Commission Agreement 2005.

(h) Corlett was authority for the proposition that an award, by its wording can operate retrospectively and include former employees.  By analogy this also applied to an industrial agreement.

(i) The Federated Engine Drivers’ and Firemens’ Association of Australasia v Adelaide Chemical and Fertiliser Company Limited (1920) 28 CLR 1, R v Commonwealth Court of Conciliation and Arbitration and the Australian Tramway Employees’ Association (1920) 29 CLR 106, Barrass v State of Victoria [1999] FCA 1166, and Telegraph Newspaper Company Pty Ltd v Australian Journalists Association (1962) 3 FLR 39 also supported this proposition. 

(j) The Industrial Magistrate should have found there was a “nexus” between the parties at the time when the 2006 Agreement retrospectively applied.

(k) Although it could not be clearly shown where the Industrial Magistrate erred in her process of reasoning, the conclusions reached were clearly in error. 

46       In summary, the respondent’s submissions were:

(a) There was a fundamental difference in the Act between retrospectivity for awards and industrial agreements.  The Commission has limited power to order that an award has retrospective effect under s39(3) but not power to order an industrial agreement has effect earlier than the date of registration.

(b) It was arguable that, although an industrial agreement has effect from the date of registration, the parties may agree that certain entitlements are to begin from an earlier date.

(c) The 2006 Agreement became an industrial agreement on 18 December 2006.  At that time the appellants were not employed in any calling mentioned in the 2006 Agreement nor were they employed by an employer who was a party to the 2006 Agreement.  Therefore by the terms of s41(4) of the Act the 2006 Agreement did not apply to the appellants. 

(d) The authorities relied on by the appellants were fundamentally different to the present position because the 2006 Agreement took effect from the date of registration.

(e) Pursuant to clause 4(2) of the 2006 Agreement, the respondent agreed to pay employees, as defined in that agreement, the increased salary and allowances provided for in that agreement, from 1 July 2006.  Clause 6 of the 2006 Agreement which defined “employee” only came into effect on the registration of the 2006 Agreement, on 18 December 2006.  Therefore for purpose of clause 4(2) the term “employee” must mean a person who comes within that definition on 18 December 2006.  Accordingly, a person who was not an employee as at 18 December 2006 was not entitled to payment under clause 4(2) of the 2006 Agreement.

(f) Therefore, the Industrial Magistrate was correct in finding the definition of “employee” must be read as at 18 December 2006. 

(g) The estimate of the number of employees contained in clause 1(4) of the 2006 Agreement does not lead to the conclusion that it applied to the appellants.  Section 41A(1)(c) of the Act required an industrial agreement to contain an estimate of the number of employees who will be bound upon registration. 

(h) Due to the evidence of Ms Lavell the submission that the appellants were covered by the 2006 Agreement because they were within the 5,311 employees as at 30 June 2006 was correctly rejected by the Industrial Magistrate. 

The Construction of the Act

47       The first issue on the appeal is about the construction of the Act.  In Chief Executive Officer, Department of Agriculture and Food v Wall and Ward [2008] WAIRC 00079, (2008) 88 WAIG 156 at [107] I said:

“In my supplementary reasons in Kenji Auto Parts Pty Ltd t/a SSS Auto Parts (WA) v Fisk (2007) 87 WAIG 328 (agreed with by Smith SC and Scott C) I referred to this issue at paragraph [38].  As there stated, statutory construction involves a consideration and analysis of the meaning of the words used in a section in the context of the legislation and legislative scheme as a whole, to try to discern the intention of the legislature (Project Blue Sky Inc and Others v Australian Broadcasting Authority (1998) 194 CLR 355 at paragraph [69]; and Wilson v Anderson and Others (2002) 213 CLR 401 at paragraph [8]).”

Industrial Agreements

48       In Wall and Ward at [121]-[124] I discussed the legislative history of industrial agreements.  In these paragraphs WAA referred to the Workplace Agreements Act 1993 (WA) and LRRA referred to the Labour Relations Reform Act 2002.  The relevant parts of these paragraphs is as follows:

“121 … From 1993, when the WAA was enacted, to the present, the meaning of “industrial agreement” in the Act has not changed.  It is defined in s7 to mean “an agreement registered by the Commission under this Act as an industrial Agreement”.  The registration of an industrial agreement is provided for in s41 of the Act, which was first inserted by s26 of the Acts Amendment and Repeal (Industrial Relations) Act (No. 2) 1984 (WA).  The nature of agreements which could be registered was changed by the Industrial Relations Amendment Act 1993 (WA).  This amendment act amended s41, and inserted s41A into the Act.  The scheme governing “industrial agreements” was changed again by amendments made by the LRRA to s41 and the repeal and replacement of s41A.  Section 130 of the LRRA inserted Part II Division 2B into the Act.  This division is headed “Industrial agreements” and comprises ss40C – 43 of the Act.

…

123 It is notable that an industrial agreement can only be made by an organisation or association of employees and not an individual employee.  This is consistent with an amendment to the objects of the Act which was also enacted by the LRRA.  The “principal objects” of the Act are contained in s6.  By s127 of the LRRA, paragraphs 6(aa) – (ag) were added.  Paragraph 6(ad) was “to promote collective bargaining and to establish the primacy of collective agreements over individual agreements”.

124 Linked to this was the insertion of s41(1a) into the Act by the LRRA and the repeal and replacement of s41A.  Section 41(1a) provided that “[a]n agreement may apply to a single enterprise or more than a single enterprise”.  Under the repealed s41A an agreement could not be registered as an industrial agreement if it applied to “more than a single enterprise”.  The amendments made by the LRRA therefore permitted wider scope for industrial agreements, made by organisations or associations of employees, as part of the new object of the Act to promote collective bargaining and establish the “primacy of collective agreements”.”  (emphasis in original)

49       Section 41(9) of the Act establishes the primacy of an industrial agreement if contrary to or inconsistent with an award.

50       The nature of industrial agreements was also discussed in the Department of Community Services and Director General of the Ministry for Cultural and Arts cases cited above.  In Department of Community Services, the Industrial Appeal Court confirmed that under the Act an agreement becomes an industrial agreement only if and when it is registered as such by the Commission (per Franklyn J at 1711 and 1712; Nicholson J at 1713).  Franklyn J at 1712 said that to “order that on registration it have effect from a date prior to its registration is to purport to give effect to it as an industrial agreement over a period of time when it was not in fact such.  That in my opinion, is clearly contrary to the provisions of ss7 and 41.  In my opinion, the industrial agreement took effect as such only from the date of its registration”. 

51       In Director General of the Ministry for Cultural and Arts, Kennedy J at [10] and Anderson J at [36]-[38] and [40] reiterated this point.  (Scott J agreed with the reasons of Kennedy and Anderson JJ). 

52       Anderson J at [38]-[40] also relevantly said:

“In this connection, of course, a distinction may be made between what the parties have agreed to and what the Commission may order.  To say that the Commission has no power to order that an industrial agreement should commence from a date earlier than the date on which the agreement came into existence is not to say that an industrial agreement may not have any retroactivity.  It might well be possible for parties to agree that certain entitlements are to begin from some earlier date.  That agreement will not have effect until it is registered and then only from the date of registration and in that sense it does not commence to operate until registered; but, arguably, once it becomes effective, the parties are bound by its terms, including those terms which impose obligations and confer rights of a retrospective nature.  I would not wish to be taken as deciding this point, but raise it only to say that it is not the issue in the case under consideration. 

…

The whole scheme of the Act in relation to industrial agreements is based upon the notion of consensus.  The idea that terms of an industrial agreement can be arbitrated is at odds with the fundamental principle of consensus.  Put simply, an arbitrated “agreement” is not an agreement.  I cannot see how it falls within s 41(1). 

…

There is nothing in s 7, which is the definition of “industrial agreement”, or s 41 which would support the notion that an industrial agreement can be created in whole or in part by coercive order of the Commission.” 

53       As set out earlier, the appellants cited a number of authorities for the proposition that an award, and a registered industrial agreement, may by their wording operate retrospectively and include former employees.  The cases relied upon do not in their terms support this proposition.  This is because none of the cases were about industrial agreements.  They were all about awards.  The potential scope and effect of an industrial agreement must be gleaned from the terms of the Act, not authorities dealing with different industrial relations systems and/or species of industrial instrument. 

54       Corlett was the authority most heavily relied upon by the appellants.  I have briefly summarised the facts and outcome above.  Corlett was decided in 1975.  The applicable legislation was the Industrial Arbitration Act 1912-1973 (WA) (the IAA).  It was about the Breadcarters (Metropolitan and Collie) Award No 35 of 1963 made by the Industrial Commission under the former legislation.  The award applied during the period when the worker was employed and continued to apply after the cessation of her employment.  The relevant amendment to the award also occurred after the cessation of her employment.  The order of the Industrial Commission which affected the amendment said the award was “further amended in accordance with the following schedule, and that such amendment shall take effect in respect of the rates set out in column A as from the first pay period commencing on and after 22 July 1974”.  Burt J at 644/645 said:

“The appellant’s contention however before the Industrial Magistrate and before us was that the retrospective amendment made to the award only applied to workers who were in employment during the period to which it related back and who were still in employment as at the date upon which the order was made.  This was said to be so because an industrial award places an obligation on an employer to his employee by operating upon the relationship of employer and employee.  That relationship, it was contended, and rightly so, was created by contract, that is to say, by the contract of employment and not by the award.  From this it was said to follow that when in the present case the amendment was made the relationship did not exist and therefore there was nothing upon which the amendment including its retrospective effect could operate.

This submission in my opinion is based upon a fundamental misconception.  Notwithstanding the form of the complaint as made in the present case, the essence of it was not that upon the award being amended, that is to say on 4th October 1974 or on the pay-day next following the appellant then or thereafter failed to pay the worker the difference between the old and the new rates of wage for the period to which the amendment was made to relate back.  The complaint was that on the pay-days falling within the period 22nd July to 30th August the appellant had failed to pay the worker at the then award rate.  And the amendments having been given true retrospective operation, the wage rates during that period were the rates set out in the amending order, and this because being retrospective one is required, as to the past date and to the past period to which it relates, to take the award to have been that which it was not.”

55       Wickham J at 645 said that the “submission that there was no relationship of employer and worker at the date when the award was in force simply denies its provision that it shall take effect as from the first pay period commencing on or after 22nd July 1974” (emphasis in original).  Wallace J also rejected the appellant’s contention.  His Honour at 646 acknowledged that the existence of the obligations under an award depend on the existence of a contract between employer and employee, however that was not the end of the matter because to solely focus on it would “deny the Commission’s statutory right to legislate retrospectively under its powers in [the IAA] and thus in effect to deny validity to the amending award”. 

56       There are numerous distinctions between the facts and law discussed in Corlett as opposed to the scheme of the Act applicable to industrial agreements.  They include:

(a) Corlett involved a different industrial relations system.

(b) The relevant industrial instrument in Corlett was an award.

(c) The award was amended.  Here the 2006 Agreement replaced the 2003 Agreement.

(d) The award as amended applied retrospectively.  The 2006 Agreement did not have this effect.  As stated it did not amend the 2003 Agreement, but replaced it with an agreement that entitled “employees” to be paid an increased salary and allowances from a date earlier than registration.

(e) In Corlett the award applied during the employees’ employment.  The 2006 Agreement did not apply during the appellants’ employment.

57       The following are the relevant features of the scheme of the Act in relation to industrial agreements:

(a) The purpose of an industrial agreement is to prevent or resolve disputes, disagreements or questions relating to an industrial matter (s41(1)).

(b) An industrial agreement may only be made between an organisation or association of employees and an employer or organisation or association of employers (s41(1)).

(c) An industrial agreement may apply to one or more enterprises (s41(1)(a)).

(d) Where the parties to an agreement apply to the Commission for registration of the agreement as an industrial agreement the Commission shall register the agreement as such (s41(2)).

(e) The only exception to this is that the Commission may require the parties to effect variations as the Commission considers necessary or desirable to give clear expression to the parties’ intentions (s41(3)).

(f) An industrial agreement extends to and binds employees and employers of a particular type only (s41(4)). 

(g) With respect to employees they must be employed in any calling mentioned in the industrial agreement in the industry or industries to which it applies and by an employer who is party to the agreement or a member of an organisation or association of employers that is a party to the agreement (s41(4)(a)(i) and (ii)). 

(h) The agreement also extends to and binds only employers of the type as just referred to (s41(4)(b)).

(i) An industrial agreement extends to and binds these employees and employers “and no other employee or employer, and its scope shall be expressly so limited in the industrial agreement” (s41(4)).

(j) An industrial agreement operates for a term as specified but continues in force in respect of all parties except any who have retired therefrom, until a new agreement or award is made in substitution (s41(5) and (6)).

(k) When a new industrial agreement is made and registered, or an award or enterprise order is made in substitution for a previous industrial agreement, that agreement is taken to be cancelled, except to the extent that the new agreement saves the provisions of the previous agreement (s41(8)).

(l) As stated earlier, an industrial agreement has primacy over an award (s41(9)).

(m) The Commission shall not register an agreement as an industrial agreement to which an organisation or association or employees is a party, unless the employees who will be bound by the agreement on registration are members of, or eligible to be members of, that organisation or association (s41A(2)).

(n) The Commission has powers to vary, renew, or cancel an industrial agreement in the circumstances as described in s43 of the Act (s43),

58       In my opinion an industrial agreement under the Act cannot bind an employer to make payments to former employees even if by the terms of the agreement there is an obligation to make increased payments to employees for a period prior to its commencement.  The words of s41(4) are clear when it refers to “employees who are employed”.  This does not encompass a past tense to include people who were employees.  The concluding words of s41(4) specifically say that “no other employee or employer” is bound by an industrial agreement.  Additionally, s41A(2) prohibits the Commission registering an industrial agreement to which an organisation or association of employees is a party, unless the employees who will be bound by the agreement upon registration are members or eligible to be members of that organisation or association.  This subsection is consistent with the scope of an industrial agreement covering only present and not past employees or members of organisations or associations of employees.  As set out above, an industrial agreement can continue after the expiry of its term but is then cancelled by the registration of a new industrial agreement.  This is what occurred in the present case. 

59       This regime is inconsistent with a new industrial agreement applying to former employees who resigned prior to that agreement and whose employment was covered by the terms of the previous industrial agreement until the cessation of the relationship of employer and employee.  As stated this regime is different from the amendment of an award as considered in Corlett and the other cases relied upon by the appellants.

60       Accordingly, in my opinion, the Industrial Magistrate was not in error in dismissing the applications.  Due to the contents of the Act, the 2006 Agreement could not have applied to the appellants as former employees of the respondent, who had ceased their employment by the date of its registration.

61       The Industrial Magistrate did not specifically dismiss the claims on this basis but said the construction her Honour placed on the 2006 Agreement was reinforced by s41(4) of the Act.

62       It is clear however that the respondent in part based its case before the Industrial Magistrate on this point and the appellants did not submit it was something the respondent could not rely upon on appeal, or only rely upon if notice was given prior to the hearing.  (See Ward and Wall for an example of an appropriate procedure of this type).

63       As I have said the appeals must be dismissed on this basis.  For completeness however I will consider the second issue, about the construction of the 2006 Agreement.

Construction of the 2006 Agreement

64       I have earlier set out the relevant clauses of the 2006 Agreement, the reasons of the Industrial Magistrate and the submissions of the parties on appeal.

65       In my opinion the approach which should be taken to the construction of an industrial agreement is the same as that which applies to an award.  This  was described by Pullin J in BHP Billiton Iron Ore Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union of Workers (Western Australian Branch) (2006) 153 IR 397 at [19]-[23] as follows:

“19 For my part, I adopt what was said in two decisions of this Court in Norwest Beef Industries Ltd & Anor v Australian Meat Industry Employees Union of Workers (WA Branch) (1984) 12 IR 314 and Robe River Iron Associates v Amalgamated Metal Workers & Shipwrights Union of Western Australia (1987) 67 WAIG 1097.

20 In the Norwest case, Brinsden J said (at 319) that, in interpreting an award, if the terms are clear and unambiguous, it is not permissible to look to extrinsic material to qualify that meaning.  To the same effect see Kennedy J at 324 and Olney J at 331.  In the Robe River case, Brinsden J (at 1098) referred again to his observations in the Norwest case and added, drawing on contractual principles, that in a case where the issue is about which of two or more possible meanings is to be given to a provision, it is not permissible to look at actual intentions, aspirations or expectations of the parties, but to look only at the objective framework of facts within which the contract came into existence and to the parties' presumed intentions in that setting. 

21 I also refer to City of Wanneroo v Holmes (1989) 30 IR 362 at 378 where French J said:

“The interpretation of an award begins with a consideration of the natural and ordinary meaning of its words: Re Clothing Trades Award (1950) 68 CACR 597 (Aust Indus Ct, Full Ct).  The words are to be read as a whole and in context: Australian Timber Workers Union v W Angliss & Co Pty Ltd  (1924) 19 CAR 172.  Ambiguity if any, may be resolved by a consideration, inter alia, of the history and subject matter of the award: Picard v John Heine & Son Ltd (1924) 35 CLR 1.  Resort to such matters as prefatory statements and negotiations is of dubious assistance if admissible at all: Seymour v Stawell Timber Industries Pty Ltd  (1985) 13 IR 289 at 290; 9 FCR 241 at 244 (Northrop J) (13 IR at 299; 9 FCR at 254) (Keely J) cf 13 IR at 309; 9 FCR at 265 (Gray J).  The logs of claim and arbitrator's reasons for decision may be referred to to determine the ambit of the dispute which led to the making of the award so that where there are two possible interpretations, one within the ambit and one without, the former may be preferred.  Evidence of the conduct of the parties subsequent to the making of the award however, cannot be relied upon to construe it: Seamen's Union of Australia v Adelaide Steamship Co Ltd (1976) 46 FLR 444, 446, disapproving Merchant Seamen's Guild of Australia v Sydney Steam Collier Owners and Coal Stevedores Association  (1958) 1 FLR 248.  That is not to say the words must be interpreted in a vacuum divorced from industry realities. …”

…

23 French J in City of Wanneroo v Holmes case, also referred to what Street J had said in Geo A Bond & Co Ltd (in liq) v McKenzie [1929] AR (NSW) 498 at 503, reminding courts that awards were made in the light of customs and working conditions of each industry and that they frequently result from an agreement between parties couched in terms intelligible to themselves but often framed without that careful attention to form and draftsmanship which one expects to find in an Act of Parliament.  Street J said that in construing an award, one must always be careful to avoid too literal adherence to the strict technical meaning of words and must view the matter broadly and after giving consideration and weight to every part of the award in giving meaning to it consistent with the general intention of the parties gathered from the whole award.” 

66       I am not attracted to any argument of the appellants based upon the terms of clause 1(4) of the 2006 Agreement.  As to the meaning and effect of this clause, the Industrial Magistrate allowed Ms Lavell to give evidence and in part based her reasons for decision upon that evidence.  There is no ground of appeal asserting the evidence was not admissible or the Industrial Magistrate erred in relying upon it. 

67       In its terms clause 1(4) simply contains an assertion of the total number of employees subject to the Agreement as at 1 July 2006.  I do not find this to be material to the construction of an agreement which as a matter of law under the Act, only took effect upon its registration on 18 December 2006. 

68       I also note the clause does not comply with s41A(1)(c) because:

(a) The statement in clause 1(4) ignored the fact that the agreement would not become effective until registration, and registration ended up taking place more than five months after 1 July 2006.

(b) As a result the number of employees set out in clause 1(4) could and did include employees who because of the terms of ss41 and 41A of the Act, were no longer capable of being covered by the 2006 Agreement when registered.

(c) Ms Lavell’s evidence indicates that clause 1(4) was not an attempt to comply with s41A(1)(c) of the Act as the number included police officers which she knew were not going to be bound by the 2006 Agreement upon registration. 

69       There is no point in the appeal which requires further consideration of the consequences of this.  I simply reiterate that I do not accept clause 1(4) supports the appeals. 

70       Clause 4(2)(a) of the 2006 Agreement was heavily relied upon by the appellants.  In its terms it applies to “employees”.  Clause 4(1) provides consistently with the legislation that the 2006 Agreement is to operate from the date of its registration, which was 18 December 2006.  Clause 4(2) has a retrospective (or what Anderson J described in the Director General of the Ministry for Cultural and the Arts case as “retroactive”) operation in that it provides benefits for employees referable to a period of work prior to the registration and operation of the 2006 Agreement.  Whilst this may be so, the entitlement is only that of “employees” and not former employees.  The effect of this clause in my opinion is that somebody who was an employee at the date of registration of the Agreement and who also worked during 1 July 2006 to 18 December 2006 was entitled to the increased payments referred to in the clause and the 2006 Agreement.  The definition of “employee” is consistent with this construction.  The same may be said about the area and scope clause of the 2006 Agreement.

71       As submitted by the appellants, they had a nexus with the employer over a period which included the period covered by the 2006 Agreement.  But that cannot detract from the feature of the 2006 Agreement that it only applied to “employees” when it took effect upon registration.  This was the nexus which the 2006 Agreement required for it to apply and the appellants were no longer so related to the respondent.

72       In my opinion this attack upon the decision of the Industrial Magistrate fails and the appeals should also be dismissed on this basis. 

Equity of the Situation

73       Initially I was somewhat concerned about what I perceived to be an unfairness from the decision of the Industrial Magistrate and the position of the respondent.  This was that the effect would be that two police officers of the same rank who worked side by side doing the same job would end up being paid different salaries and allowances.  There was something which rankled about this.

74       Having now considered the issue in more depth however, I am not satisfied that this concern about inequity means that the appeals must be decided in any way other than by their dismissal.  It is of course the role of the Full Bench, as I have said earlier, to seek to elicit the intention of the legislature by considering the language used in the Act.  In this process a relevant consideration is the consequence of a particular construction.  Consequences which judicial officers may think to be unfair at one level however cannot override the obligation to construe legislation in accordance with the meaning of the language expressed.  For the reasons I have set out earlier, in my opinion the legislature has clearly expressed an intention that industrial agreements are not to apply to people who are no longer employees of the relevant employer.  As mentioned earlier, unlike an amendment to an award, a key aspect of industrial agreements is that the registration of a new agreement cancels a previous one.  In this case, that meant the 2006 Agreement cancelled the 2003 Agreement but only upon registration.  Whilst the dispute which gave rise to the 2006 Agreement originated and continued during the course of the appellants’ employment with the respondent, prior to the coming into existence of the 2006 Agreement they resigned.

75       Therefore the last period of the appellants’ employment with the respondent was wholly governed by the 2003 Agreement.  At no time was it governed by the 2006 Agreement.  Police officers who continued to be employed on and after 18 December 2006 had by the 2006 Agreement a benefit which was referrable to something that happened before its commencement.  But this did not apply to those who were no longer employees as at that latter date.  Analysed in this way, what appeared at first blush to be an inequitable position is explicable and in any event the consequence of what I believe to be the proper construction of the legislation. 

76       Since preparing my reasons in draft I have had the opportunity to read in draft form the reasons of Beech CC and Scott C.  With respect I agree with the observations of Scott C.

77       I have carefully considered the reasons of Beech CC which reach a different conclusion to mine.  With great respect the Chief Commissioner’s reasons have not caused me to change my opinions.  This is primarily for two reasons. 

78       Firstly, as I said earlier, I do not with respect think that the statement in the 2006 Agreement about the estimate of employees to be covered is a significant constructional aid.  This is especially so given the terms of s41A(1)(c) and the evidence of Ms Lavell.  Also the 2006 Agreement is not drafted in a way which links its coverage to the estimate. 

79       Secondly, the Chief Commissioner reasons that when the date on which the increased salary and allowances took effect there was (as per Wickham J in Corlett at 645) a relevant contract of employment existing.  With respect I do not agree.  In my opinion the increased salary and allowances took effect on 18 December 2006 and at that time there was no contract of employment between the appellants and the respondent.  Clause (4)(1) of the 2006 Agreement said, consistently with s41(5) of the Act, that it “shall operate” from the date of its registration, which was 18 December 2006.  On and from that date the respondent was bound to pay “employees” the amount of the increased salary and allowances. This was to apply for the future and also for work which had been done after 1 July 2006.  The appellants were not “employees” of the respondent on 18 December 2006 however and therefore the 2006 Agreement did not apply to them. Put slightly differently the payment of the increased salary and allowances to the “employees” of the appellants for work done from 1 July 2006 was an entitlement that they had because of the coming into being of the 2006 Agreement. As the appellants were no longer “employees” of the respondent when that occurred, on 18 December 2006, they could not obtain the benefit of this entitlement

Disposition of Appeals and Assistance from Counsel

80       For these reasons in my opinion each of the appeals must be dismissed.

81       At the conclusion of the hearing I thanked both counsel for the nature and quality of their submissions which clearly articulated the case for their clients.  It is appropriate to also record this in my reasons.

BEECH CC:

82      The essence of the appellants' grounds of appeal is that the Industrial Magistrate erred in fact in not finding that the appellants were employees of the Commissioner of Police at all material times referred to in clause 1(4) of the 2006 industrial agreement, and erred in law in not finding that the extent of the retrospective effect of industrial agreements registered under s 41 of the Act is defined exclusively by the terms of the retrospective provisions, and that the clear and unambiguous terms of clauses 1 and 4 of the 2006 industrial agreement had retrospective effect with the intention that the 2006 industrial agreement should apply to the appellants. 

83      The facts of the matter are able to be shortly stated.  Each of the appellants was a police officer and member of the WA Police Union until their retirements which occurred respectively on 26 July 2006, 31 July 2006 and 24 August 2006.

84      Until their retirement they had been paid the salary and allowances as provided by the 2003 industrial agreement.  The 2003 industrial agreement expired on 30 June 2006 but continued in existence until it was replaced by the 2006 industrial agreement.

85      It is agreed that the 2006 industrial agreement was registered by the Commission on 18 December 2006. 

86      In the 2006 agreement, subclause 4(1) provides that the agreement shall operate from the date of its registration to 30 June 2009.  Paragraph 4(2)(a) provides:

“4(2)(a) Despite subclause (1) above, the Employer will pay employees the increased salary and allowances (other than the covert allowance) provided for in this Agreement as from 1 July 2006.”

87      The Industrial Magistrate dismissed the complaints of the appellants that the Commissioner of Police had breached the terms of the 2006 industrial agreement by not paying them the increased salary and allowances provided for in the 2006 industrial agreement as from 1 July 2006 until their retirements.  It is against the dismissal of their complaints that these appeals are now brought.

88      It is common ground that the Commission itself does not have the power to order the retrospective operation of an industrial agreement.  An industrial agreement takes effect only from the date of its registration: Department of Community Services and Others v Civil Service Association of WA (Inc) (1994) 74 WAIG 1709 at 1712.

89      Any retrospective effect to be given to any part of the 2006 industrial agreement can only occur as a result of the parties' agreement that certain entitlements are to begin from some earlier date: Director General of the Ministry for Culture and the Arts v The Civil Service Association of WA Inc and Others (2000) 80 WAIG 453 at 456.  This is to be contrasted with the power of the Commission in s 39 of the Act to give retrospective effect to the whole or any part of an award subject to the requirements inherent in s 39(3) of the Act.  If, instead of the parties expressing their agreement in an industrial agreement, they had instead amended the Police Award to reflect the terms of their agreement, which they could readily have done, the Commission could at their request have varied the award from 1 July 2006 and this issue would not have arisen.  That has not occurred and in this case the retrospective effect at the heart of the complaints does not arise from a Commission order.  The order of the Commission merely registered the industrial agreement and in doing so replaced the 2003 industrial agreement with it. 

90      As any retrospective effect to be given to any part of the 2006 industrial agreement can only occur as a result of the parties' agreement that certain entitlements are to begin from some earlier date, whether the 2006 industrial agreement obliged the Commissioner of Police to pay the three appellants can only be ascertained by a consideration of the industrial agreement as a whole and its language; it will depend upon the meaning of the word “employees” in the context of the parties’ agreement. 

91      In this respect, I agree with the conclusion of her Honour when she stated at p 6 of her Reasons:

“In determining whether [the definition of employee within the agreement] encompasses any person who was employed as at 1 July 2006 but ceased such employment prior to 18 December 2006 one needs to examine the 2006 Industrial Agreement in its entirety.” 

92      However I must respectfully disagree with the conclusion of her Honour when she stated:

“There is nothing in the 2006 Industrial Agreement to indicate that the definition of “employee” extends to those who were employed as at 1 July 2006 but ceased their employment prior to 18 December 2006.  If it were intended that the 2006 Industrial Agreement should be operative from the date of its registration (as per clause 4(1)) but should extend to persons who had been previously members of WAPOL then one would expect clause 5(1) and the definition of “employee” to expressly so provide.  Commonsense dictates that clause 5(1) (referred to later in these reasons) and the definition section be read in terms of applying to members as at 18 December 2006.”

93      On the evidence, it is certainly open to conclude that the parties' use of the word “employee” did indeed include those police officers who were employed as at 1 July 2006 but ceased their employment prior to 18 December 2006.  First, by subclause 5(1) of the 2006 industrial agreement, the agreement extends to and binds all Members of the WA Police Force and Aboriginal Police Liaison Officers appointed under the provisions of the Police Act 1892. 

94      During the appeal, the respondent's counsel suggested that this provision should not be taken to have the agreement extend to all members of the WA Police Force no matter when they were members of the WA Police Force.  However, the wording speaks for itself: the agreement extends to and binds all members of the WA Police Force.  It is agreed that the appellants were members of the WA Police Force even if they were not so at the time of registration.  They were certainly members of the WA Police Force during the period from 1 July 2006 until their respective retirements. 

95      Secondly, the appellants were included in subclause 1(4) of the industrial agreement which provides:

“As at 1 July 2006, the number of employees subject to this Agreement totalled 5311.”

96      The evidence before the learned Industrial Magistrate, and accepted by her, was that the figure of 5311 was not an accurate figure because it includes persons who would not be covered by the agreement.  The significant points however, in my respectful view, are that:

• it is a provision which relates directly to the “employees” to be covered by the agreement.  That is, is an aid in construing the parties' use of the word “employee” in the agreement;
• the figure is estimated as at 1 July 2006 and not from the date of registration in December 2006.  It is exactly the same date as the date in subclause 4(2)(a) which is the source of the obligation on the Commissioner of Police to pay employees the increased salary and allowances provided; and
• it was irrelevant whether the figure included persons who would not be covered by the agreement.  What was relevant was that it included the appellants because they were police officers at that date whereas a figure estimated as at the date of registration would not have included them.

97      Whether or not that date is now seen as not complying with the requirement in s 41A(1)(c) of the Act which requires the estimate to be upon registration, or whether the figure was not able to be corrected because of a shortage of time prior to the registration is, with respect, quite beside the point.  It is a valid term of a registered industrial agreement and it must be treated as such. 

98      Therefore, subclause 1(4) is a strong indication that the parties' use of the word “employee” did indeed include those who were employed as at 1 July 2006 but ceased their employment prior to 18 December 2006 and the learned Industrial Magistrate erred in my respectful view in not so finding. 

99      Thirdly, it is significant that clause 4(1) of the 2006 industrial agreement provides that it operates not for 3 years from the date of its registration, but to 30 June 2009.  It shows the parties' intention that notwithstanding its registration on a date after the expiry of the 2003 industrial agreement, the 2006 industrial agreement, and particularly the increased salary and allowances (other than the covert allowance) provided for in it, was to be seen as being as operating for 3 years from 1 July 2006 even though it did not come into existence as an industrial agreement until its registration in December.   If that is so, then it is another indication that the parties saw the “employees” to be covered by it as extending to those who were employed as at 1 July 2006 but who ceased their employment prior to 18 December 2006.

100   It is easily said that the definition of “employee” in the Act refers in the present tense to persons who are, not were, in employment.  It is also correct to say, with respect, that whilst the appellants were employees when they were serving police officers, they did not remain employees after they retired, but with respect, in my view that is not decisive because the intention of the parties from their own agreement does not turn upon whether the appellants were employees at the date of registration of the agreement.   To hold to the contrary is to create the manifest inequity referred to by the appellants in the proceedings before the Industrial Magistrate (see transcript at first instance p 6) where police officers doing the same work will receive different rates of pay for that work. 

101   Further, during the period from 1 July 2006 and the date of registration, there were relevant contracts of employment between the appellants and the Commissioner of Police to which the requirement on the Commissioner of Police in subclause 4(2)(a) of the industrial agreement attached.  They were “relevant” in the sense used in the decision of the Industrial Appeal Court in Corlett Bros Pty Ltd v Transport Workers Union of Australia, WA Branch (1975) 55 WAIG 644. 

102   In that matter, the employee concerned was employed under an award which was varied retrospectively by the Commission.  The employee had left employment by the time the Commission amended the award but had been employed under the award during the period of retrospective operation of the award increase.  In this appeal, the respondent suggested strongly that Corlett's case can be distinguished because it concerned an award which applied to the employee and was amended retrospectively in contrast to the present circumstances where the industrial agreement which provides for the retrospective payment of salaries did not come into existence until it was registered on a date after the appellants had ceased to be employees. 

103   The distinction on the facts is sound.  The appellants never worked under the 2006 industrial agreement and it was not made to operate from a retrospective date by order of the Commission.   However, the reasoning in Corlett remains quite relevant.

104   In Corlett, Burt J (as he then was) noted that the contention was that the retrospective amendment made to the award only applied to employees who were in employment during the period to which it related back and who was still in employment as at the date upon which the retrospective order was made.  His Honour stated at 645:

“This was said to be so because an industrial award places an obligation on an employer to his employee by operating upon the relationship of employer and employee.  That relationship, it was contended, and rightly so, was created by contract, that is to say, by the contract of employment and not by the award.  From this it was said to follow that when in the present case the amendment was made the relationship did not exist and therefore there was nothing upon which the amendment including its retrospective effect could operate.”

105   I interrupt the quote to say that thus far, I consider that the argument being put to his Honour is entirely consistent with the argument being put before this appeal bench.  That is, the relationship of employer and employee is created by the contract of employment, not by an award or an industrial agreement.  Thus, so the argument goes, when the 2006 industrial agreement was registered, their relationship did not exist and therefore there was nothing upon which the requirement upon the Commissioner of Police to pay salaries to employees retrospectively could operate. 

106   The answer in Corlett, and the answer to the argument, lies in what follows.  Burt J continued:

“This submission in my opinion was based upon a fundamental misconception.  Notwithstanding the form of the complaint as made in the present case, the essence of it was not that upon the award being amended, that is to say on 4th October 1974 or on the pay-day next following the appellant then or thereafter failed to pay the worker the difference between the old and the new rates of wage for the period to which the amendment was made to relate back.  The complaint was that on the pay-days falling within the period 22nd July to 30th August the appellant had failed to pay the worker at the then award rate.  And the amendments having been given true retrospective operation, the wage rates during that period were the rates set out in the amending order, and this because being retrospective one is required, as to the past date and to the past period to which it relates, to take the award to have being that which it was not.”

107   In the present case, the increased salary and allowances (other than the covert allowance)  under the 2006 industrial agreement having been given true retrospective effect by virtue of paragraph 4(2)(a), the salary and allowances payable from 1 July 2006 are the salary and allowances as set out in the 2006 industrial agreement.  There having been a contract of employment between each of the appellants and the Commissioner of Police during the period of the retrospective payment required under the 2006 agreement, there was a contract of employment existing and therefore there was indeed something upon which the retrospective operation of the industrial agreement could operate. 

108   It is no answer, in my respectful observation, to say that there was no employment relationship between the Commissioner of Police and the appellants at the date when the agreement was registered.  At the date the increased salary and allowances took effect there was, to paraphrase the closing words of Wickham J in Corlett at 645, a relevant contract of employment existing and the employee was entitled to be paid in accordance with the terms of the 2006 industrial agreement.

109   While I respectfully agree with the concluding comments of the Hon Acting President in reference to my own reasons that on 18 December 2006 there was no contract of employment between the appellants and the respondent, I respectfully disagree with his Honour’s reasoning that the appellants were not “employees” of the respondent on 18 December 2006 and therefore the 2006 Agreement did not apply to them.  In Corlett, when the award was amended on 4 October 1974 the employee the subject of that matter was not an employee of Corlett Bros either; that fact was not determinative of the issue in that matter and it is not determinative of the issue in this matter.  In this matter, the retrospective payment of the increased salary and allowances (other than the covert allowance) is a creature of the 2006 industrial agreement, not the Commission’s order, and the meaning of the word "employees" is to be determined by examining the use of the word in the 2006 industrial agreement.  As the appellants were included in the number of employees subject to the agreement in subclause 1(4), they must have been “employees” during the period covered by the retrospective payment and they had an entitlement because of the coming into being of the 2006 industrial agreement.

Conclusion

110   In my view, the appellants' grounds 4(b) to (e) are made out.  I consider that the learned Industrial Magistrate erred in not finding that the 2006 industrial agreement required the Commissioner of Police to pay employees the increased salary and allowances (other than the covert allowance) provided for in this agreement as from 1 July 2006. 

111   I would uphold the appeal and remit the matter to the Industrial Magistrate to further deal with according to this decision.

SCOTT C:

112    I have had the benefit of reading the Reasons for Decision of His Honour, the Acting President.  For the reasons he has set out, the appeals ought to be dismissed.  I add the following comments:

1. The legislative scheme dealing with the application of awards and agreements is separate and distinct.  Therefore authorities which deal with retrospectivity as it applies to awards are of little assistance.

2. Although the Appellants suggested that the 2006 Agreement had retrospective effect, it had effect from the date of registration.  Certain increased payments were to have retrospective effect.  The Agreement as a whole did not.  Therefore, the Appellants were not at any time subject to the 2006 Agreement as they were not employees at the time it came into effect.  On that basis the retrospectively applied payments were not applicable to the Appellants.