INTERPRETATION OF CLAUSES 3.1.1, 3.1.2 AND 6.7 OF THE PUBLIC TRANSPORT AUTHORITY (TRANSPERTH TRAIN OPERATIONS RAIL CAR DRIVERS) INDUSTRIAL AGREEMENT 2013

WESTERN AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION

CITATION : 2015 WAIRC 00324

DELIVERED : Tuesday, 21 April 2015

FILE NO. : APPL 36 OF 2014

Applicant

AND

Public Transport Authority of Western Australia

Respondent

Catchwords : Industrial law (WA) - Agreement - Interpretation of clauses of the Public Transport Authority (Transperth Train Operations Rail Car Drivers) Industrial Agreement 2013 - Interpretation of cls 3.1.1, 3.1.2 and 6.7 - Principles applied - Method of rostering drivers who take annual leave - Terms of the Agreement read as a whole - Standard hours and ordinary hours - Declaration issued

Legislation  : Industrial Relations Act 1979 (WA) s 46

  Minimum Conditions of Employment Act 1993 (WA) ss 5, 18(1), 23

Result : Declaration issued

Representation:

Counsel:

Applicant : Mr K Singh

Respondent : Mr R Andretich of counsel

Case(s) referred to in reasons:

Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241

BHP Billiton Iron Ore Pty Ltd v The Australian Workers’ Union Western Australian Branch, Industrial Union of Workers & Ors (2006) 86 WAIG 2696

Director General, Department of Education v United Voice WA (2014) 94 WAIG 1

Kucks v CSR Limited (1996) 66 IR 182

Norwest Beef Industries Limited v Australian Meat Industry Employees Union, Industrial Union of Workers, Perth (1984) 64 WAIG 2124

Re Engine Drivers’ Award – State (1980) AILR 314

Re The Vehicle Industry – Repair, Services and Retail – Award 1976 (1979) 38 FLR 267

The Annual Leave Cases 1971 (1972) 144 CAR 528

Reasons for Decision

1          When a railcar driver employed by the Public Transport Authority goes on one week’s annual leave, in the first week of a fortnightly cycle, the practice of the Authority is to deduct 38 hours from the employee’s leave balance and when the employee returns, require the driver to work 42 hours in the second week of the fortnightly roster cycle. For that fortnightly cycle, the driver is paid for 78 hours at their ordinary rate of pay and accumulates two hours towards “credit days”.  Credit days are days that may be taken off work by a driver on full pay.  They result from four hours of each fortnightly roster cycle of 80 hours of work, being credited to the driver.

2          The method of rostering drivers who take annual leave is disputed by the Union.  It contended that on its proper construction, the Public Transport Authority (Transperth Train Operations Rail Car Drivers) Industrial Agreement 2013 requires drivers to be paid overtime for time worked in excess of 40 hours in the second week of the fortnightly roster cycle, after a driver takes one week of annual leave. This is on the basis that in the second week, a driver can only accrue two hours towards a credit day, over and above 38 ordinary hours per week.

3          As the parties cannot agree as to the proper construction of the terms of the Agreement, in particular cls 3.1.1, 3.1.2 and 6.7, the Union brings this application for a formal interpretation by the Commission. Declarations and orders are sought.

Questions posed

4          Apart from question 4.3 in the application, which the parties agree is not necessary to be answered for the purposes of resolving the present disagreement, the questions posed for answer in these proceedings are:

4.1 Are rail car drivers employed on a 76 hour per fortnight basis?

4.2 Do 76 hours per fortnight represent a rail car driver's ordinary hours?

…

4.4 Do rail car drivers, who are regular day shift employees, accrue four weeks' annual leave (with reference to their ordinary hours)?

4.5 Do rail car drivers, who are seven day shift employees, accrue five weeks' annual leave (with reference to their ordinary hours)?

4.6 When a rail car driver takes a week of annual leave, should 38 hours be deduced from their leave balance?

4.7 When a rail car driver takes a week of annual leave in a fortnightly cycle, are they only required to work 38 hours in the following week to make up their ordinary hours?

4.8 When a rail car driver takes a week of annual leave in a fortnightly cycle, can they only accumulate a maximum of two hours towards credit days in the following week?

4.9 When a rail car driver takes a week of annual leave in a fortnightly cycle, is any rostered time above 40 hours in the following week rostered overtime?

Provisions of the Agreement

5          It is convenient to set out the relevant provisions of the Agreement referred to in the application. They are cls 3.1.1, 3.1.2 and 6.7 which are in the following terms:

3.1.1 The ordinary hours of full-time employment shall be seventy six (76) hours per fortnight, and shall consist of up to ten shifts which shall constitute a fortnight's work.

3.1.2 For the purposes of subclause 3.1 the seventy six (76) hour fortnight shall be worked in accordance with the following provisions:

(a) The Standard Hours of full-time employment in each fortnightly cycle will be 80 hours.

(b) Four hours in each fortnightly cycle will be accumulated towards Credit Days, which may be cleared in accordance with subclause 6.6 - Taking of Leave or be cashed out in accordance with subclause 6.5 - Cashing out of Leave Entitlements.

6.7 Annual Leave

6.7.1 Regular Day Shift Employees

(a) Except as herein provided a period of four (4) consecutive weeks leave with payment at the employee's base rate of wage, plus a leave loading of seventeen and a half percent (17.5%) shall be allowed annually to an employee by the Employer.

(b) Entitlements to Annual Leave accrue pro rata on a weekly basis.

6.7.2 Seven Day Shift Employees

(a) Shift employees who work other than regular day shift shall be entitled and allowed an additional week's leave on full pay inclusive of leave loading of twenty (20%) percent.

(b) This provision shall also apply to any other employee whose rostered hours of work can be extended over Saturdays and Public Holidays and whose hours of duty vary throughout the twenty-four (24) hours of the day and who may be called upon to work Sundays.

(c) Notwithstanding anything elsewhere contained herein this subclause shall not apply to any employee whose rostered hours of work must be completed between Monday and Friday inclusive and not on Public Holidays.

6.7.3 Part Qualifying Period Seven Day Shift Employee: Where an employee with twelve (12) months' continuous service is engaged for part of a qualifying twelve (12) monthly period as a seven day shift employee, the employee shall be entitled to have the period of Annual Leave to which the employee is otherwise entitled under this subclause increased by one-twelfth of a week for each completed month the employee is continually so engaged, and shall be paid for the Annual Leave plus the extra leave at the employee's Base Rate of Pay, plus a loading calculated at eighteen and three quarter (18.75%) percent for the Annual Leave taken.

6.7.4 Annual Leave Loadings: An employee shall be entitled to:

(a) the amount of loading calculated in accordance with subclauses 6.7.1, 6.7.2 or 6.7.3 as the case may be.

(b) The Annual Leave Loading shall not exceed the Average Weekly Total Earnings of all males in Western Australia as published by the Australian Bureau of Statistics for the September Quarter of the year immediately preceding that in which the leave commences.

6.7.5 The maximum Annual Leave Loading payable to shift employees who are granted an additional week's leave shall not exceed 5/4th of the Average Weekly Total Earnings of all Males in Western Australia, as published by the Australian Bureau of Statistics, for the September quarter of the year immediately preceding that in which the leave commences.

6.7.6 No Deduction: An employee’s entitlement to Annual Leave continues to accrue for the period an employee is off duty through sickness for any continuous period of up to three (3) calendar months.

Contentions

6          Both the Union and the Authority helpfully filed written submissions which they supplemented by oral submissions in the course of the hearing. 

7          In summary the Union contended that on its proper construction, the Agreement in cl 3.1.2 does not provide for the circumstances where a railcar driver is unable to work up to ten shifts in a fortnightly period, because he or she is on annual leave during that time. The submission of the Union was that it would be an absurd result if drivers were required to meet their standard hours of employment of 80 hours in a fortnight, where they are unable to work up to ten shifts over that period.

8          Rather, the Union submitted that where a driver takes a week’s annual leave, and is accordingly unavailable to work five shifts in that fortnightly cycle, then on their return, they should only be required to work 38 hours to meet their ordinary hours’ requirement, plus an additional two hours as accumulated time towards credit days. Thus, a driver is only required to work 40 hours in the second week of a fortnightly cycle, before the requirement to pay overtime applies.

9          On the other hand, the Authority submitted that it is clear from the terms of the Agreement read as a whole, that accrued annual leave is taken at the rate of 38 hours per week, being part of a driver’s ordinary hours of work. In the situation where an employee takes one weeks’ annual leave in the first week of a fortnightly cycle of 80 standard hours, that first week of leave is paid at 38 ordinary hours. The Authority contended that there is no accrual of two hours towards credit days because payment of 38 ordinary hours satisfies the requirements of cl 3.1.1.  In the following week on return from leave, the driver is required to work in accordance with clause 3.1.2, providing for rostered hours of up to 42 in that week prior to overtime rates being applicable. This is on the basis that over the fortnightly cycle, a maximum of 80 ordinary hours may be worked prior to overtime being applied.

Consideration

10       The interpretation of an industrial agreement, as with any other instrument, is essentially a text based activity. The Commission should adopt the ordinary and natural meaning of the provisions in the award or industrial agreement, having regard for the context in which the words in question appear: BHP Billiton Iron Ore Pty Ltd v The Australian Workers’ Union Western Australian Branch, Industrial Union of Workers & Ors (2006) 86 WAIG 2696; Norwest Beef Industries Limited v Australian Meat Industry Employees Union, Industrial Union of Workers, Perth (1984) 64 WAIG 2124. In the case of industrial agreements, the language of an agreement should be construed in accordance with its industrial purpose and context, avoiding a narrow or pedantic approach to interpretation: Director General, Department of Education v United Voice WA (2014) 94 WAIG 1 per Buss J adopting and applying Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241 and Kucks v CSR Limited (1996) 66 IR 182.

11       There is a distinction in the Agreement between “ordinary hours” and “standard hours”.  By cl 3.1.1 ordinary hours are 76 hours per fortnight.  By extension, this means 38 ordinary hours are the ordinary hours per week, having regard to the definition of a “day” in cl 1.5.8 of 7.6 hours. On the other hand, “standard hours”, are by cl 1.5.28, defined as those specified in cl 3.1.2.  Standard hours are paid at “base rates only”.  By cl 1.5.5, “base rate of pay” is that set out in cl 4.1.  This base rate of pay is the ordinary weekly rate for a railcar driver.

12       Construed as a whole, as the Agreement must be, it seems clear that the distinction between ordinary hours and standard hours, is for the purposes of enabling a work cycle of hours to include a “credit day” as it is defined in cl 1.5.6, on the basis that a driver works 80 hours in a fortnightly cycle, and accrues four hours per fortnight, or eight hours per month, to be taken as time off at a later date.  That in itself is wholly unremarkable.  Many awards and industrial agreements make provision for how a 38 hour week may be worked, this being one of them.  Importantly, for present purposes, the Authority may roster a railcar driver to work 80 ordinary hours, prior to the obligation to pay overtime in any fortnightly period.

13       From the combined effect of cls 6.7.1, 3.1.1, 1.5.8, 1.5.5 and 4.1, in my view, a weeks’ annual leave must be construed as a period of absence for five working days of 38 ordinary hours. This is on the additional basis that by s 23 of the Minimum Conditions of Employment Act 1993, implied into all awards and industrial agreements by s 5 of the MCE Act, is an entitlement to four weeks’ annual leave based on an employee’s ordinary hours of work.

14       As a matter of long standing industrial principle, a period of annual leave is to be generally regarded as time worked and service performed by an employee. An employee whilst on annual leave is entitled to receive, subject to the terms of any industrial instrument applicable to their employment, the payments they would otherwise have received for ordinary working hours, had they not been on leave:  The Annual Leave Cases 1971 (1972) 144 CAR 528; Re The Vehicle Industry – Repair, Services and Retail – Award 1976 (1979) 38 FLR 267; Re Engine Drivers’ Award – State (1980) AILR 314. This may extend to over award payments, shift loadings and various allowances payable for working ordinary hours. Thus the annual leave benefit, whether conferred by industrial instrument or statutory provision, relieves an employee from the obligation to attend at work, whilst receiving remuneration for an ordinary week’s work (see too s 18(1) MCE Act).

15       In my view, this principle assists in answering the central proposition thrown up by this matter. Whilst a railcar driver is on annual leave for one week of a fortnightly cycle, they are still, for the purposes of the Agreement, regarded as being “at work”. Their service, for award or benefit purposes, is continuous.  However, as they are not actually required to work 40 hours, as part of the standard hours of work for the purposes of cl 3.1.2 of the Agreement, they do not accumulate two hours towards credit days. A railcar driver whilst on leave is paid his or her ordinary hours for a week as prescribed in cl 3.1.1 which is 38 hours pay.

16       It follows from this, that when a railcar driver returns to work in the second week of a fortnightly work cycle, the Authority, consistent with its rights under cl 3.1.2, is able to roster the driver such that the standard hours are met over the fortnightly period, of 80 hours. This means, having “worked” 38 hours in the first week while on annual leave, the Authority may roster a driver for up to 42 hours in the second week, to meet the standard hours requirement in cl 3.1.2, prior to overtime hours becoming payable. The approach to construction adopted by the Union in effect means, that when a driver takes a period of leave in a fortnightly cycle, then their standard hours revert to only 78 for that fortnightly period. In my view, that is not consistent with the scheme of hours of work as contemplated by the relevant clauses in the Agreement.

17       In my view, the approach I have adopted in this matter is consistent with the terms of the Agreement, considered as a whole. It is consistent with the dual concepts of “ordinary hours” and “standard hours” in cls 3.1.1 and 3.1.2 of the Agreement, and preserves the integrity of both.  It is an approach that does not involve any absurdity or repugnancy with the terms of the Agreement as a whole.  The Agreement provides for 38 hours to be an ordinary working week, but also provides for 80 hours in a fortnight to be worked prior to the payment of overtime, to account for the accumulation of credit days. The interpretation adopted in this matter is consistent with these two concepts.

Answers to questions posed

18       Based upon the above consideration, the answers to the questions posed are:

(a) 4.1 – yes

(b) 4.2 – yes

(c) 4.3 – unnecessary to answer

(d) 4.4 – yes

(e) 4.5 – yes

(f) 4.6 – yes

(g) 4.7 – no.  A driver is required to work 40 hours.

(h) 4.8 – yes

(i) 4.9 – no.  Overtime will only apply after 42 hours is worked

19       A declaration now issues.