Appeal against a decision of the Public Service Arbitrator in matter no. PSACR 5 of 2018 given on 12 July 2018

WESTERN AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION

FULL BENCH

CITATION : 2019 WAIRC 00020

DELIVERED : TUESDAY, 29 JANUARY 2019

FILE NO. : FBA 7 OF 2018

Appellant

AND

Commissioner of Police, WA Police Service

Respondent

ON APPEAL FROM:

Jurisdiction : Public Service Arbitrator

Coram : Senior Commissioner S J Kenner

Citation : [2018] WAIRC 00415; (2018) 98 WAIG 1081

File No : PSACR 5 of 2018

CatchWords : Industrial Law (WA) - Industrial dispute - Arbitrator erred in finding employer entitled to direct an employee to take unpaid personal leave without pay by operation of Public Service and Government Officers CSA General Agreement 2017 when read with Administrative Instruction 601 - Construction of administrative instructions as modified by Public Sector Management Act 1984 (WA) considered - Application of employer's Ill Health Retirement Policy required in the factual circumstances of the case before the Arbitrator that personal leave be with pay

Legislation : Industrial Relations Act 1979 (WA), s 26(3), s 49

Corporations Law (Cth) (repealed), s 583

Interpretation Act 1984 (WA), s 41, s 42

Public Sector Management Act 1994 (WA), s 22A(7), s 29(1)(h), s 30(b), s 39, s 64, s 64(1), s 100(2), s 108

Public Service Act 1978 (WA) (repealed), s 3, s 19

Public Service Regulations 1988

Result : Appeal upheld; decision of Public Service Arbitrator varied

Representation:

Appellant : Mr B Cusack and with him Ms D Larson

Respondent : Mr D Anderson, of counsel

Solicitors:

Respondent : State Solicitor for Western Australia

Case(s) referred to in reasons:

Automatic Fire Sprinklers Pty Ltd v Watson [1946] HCA 25; (1946) 72 CLR 435

Peninsular Group Ltd v Kintsu Co Ltd (1998) 44 NSWLR 534

Reasons for Decision

SMITH AP:

The appeal

1         This is an appeal to the Full Bench instituted pursuant to s 49 of the Industrial Relations Act 1979 (WA) (IR Act) against the decision of the Public Service Arbitrator to dismiss PSACR 5 of 2018 on 12 July 2018 ([2018] WAIRC 00415; (2018) 98 WAIG 1081).

Background

2         PSACR 5 of 2018 was an industrial matter referred for hearing and determination arising out of a dispute between the appellant and the respondent in respect of a direction given by the respondent to one of the appellant's members, Ms Tara-Jayne Richardson, not to attend work and to place Ms Richardson on personal sick leave on 22 December 2017.

3         The schedule of matters referred for hearing and determination were as follows:

1. Ms Tara-Jayne Richardson is a member of the Union and is employed by the Commissioner of Police as a Level 2 Administrator in the Forensic Fingerprint Bureau.

2. Due to significant ill-health, Ms Richardson has utilised all her entitlement to paid personal leave under the Public Service and Government Officers CSA General Agreement 2017. Ms Richardson was granted paid personal leave up to 7 December 2017. Prior to this time, Ms Richardson had been working three days per week and taking personal leave for two days per week.

3. As a result of medical reports obtained by both Ms Richardson and the Commissioner of Police, the parties are in dispute as to Ms Richardson's fitness to resume her full duties and whether she should be called upon to retire in accordance with the terms of s 39 of the Public Sector Management Act 1994 (WA). That remains a separate issue to the present dispute.

4. The present dispute relates to the Union's contention that the Commissioner of Police has unilaterally and unlawfully, placed Ms Richardson on unpaid personal leave. The Union's position is that the Commissioner of Police has no ability to do so without an application being made for such leave by an employee. This is disputed by the Commissioner of Police.

5. The Union contends that the actions of the Commissioner of Police in unilaterally placing Ms Richardson on unpaid personal leave is also contrary to his own policy entitled 'HR ‑ 11.05 Retirement on the Grounds of Ill Health – Police Staff'. The Union contends that the effect of this policy is to require that Ms Richardson be paid whilst unfit for duty.

6. Accordingly, the Union contends that the Commissioner of Police has acted contrary to both the terms of the Agreement and his own policy. The Union seeks a reversal by the Commissioner of Police of his decision to place Ms Richardson on unpaid personal leave for 14, 15, 21 and 22 December 2017 and from 22 December 2017 onwards. The Union also says that Ms Richardson should be reimbursed by the Commissioner of Police for her lost entitlements.

7. The Commissioner of Police objects to and opposes the Union's claim and maintains that at all material times, he has acted in accordance with his rights and obligations.

4         The industrial dispute was essentially whether Ms Richardson's absence from work from 22 December 2017 to 31 January 2018 should have been treated as unpaid leave, or as paid time in accordance with the respondent's HR-11.05 Retirement on Grounds of Ill Health - Police Staff (Ill Health Retirement Policy).

5         The Arbitrator determined the matter on agreed facts and documents.

Agreed facts and material documents

6         Ms Richardson is a public service officer and employed by the respondent as a fingerprint processing officer in the Forensic Fingerprint Bureau.

7         Ms Richardson suffered significant periods of ill health beginning in April 2017.  By 7 December 2017, she had used all of her accrued entitlements to paid personal leave under the Public Service and Government Officers CSA General Agreement 2017 (2017 General Agreement).

8         As at 7 December 2017, Ms Richardson for a period of time had been working three days a week and taking personal leave for two days a week.

9         On 29 November 2017, at the instruction of the respondent, Ms Richardson undertook a medical assessment with Western Australian police consultant occupational physician, Dr Karina Powers.

10      At the assessment, Dr Powers informed Ms Richardson that she would recommend to the respondent that he should consider that she (Ms Richardson) should be retired on the grounds of ill health.

11      In a report by Dr Powers dated 29 November 2017, in answer to a question, 'Please outline any changes to her treatment, and how effective this has been', Dr Powers stated:

Despite multiple specialist involvement and various medication changes, she has been unable to present a durable reliable work return over the long term and the number and complexity of her medical conditions means she is at high risk, based on current information, of further significant time off work and/or significant symptoms affecting her efficiency and focus when at work within the foreseeable future.

12      A copy of Dr Powers' report dated 29 November 2017 was sent to Ms Richardson's general practitioner.

13      On 6 December 2017, Dr Powers produced a supplementary report in which she gave answers to three questions as follows:

1) In your opinion is Ms Richardson currently fit to continue working 3 full days per week in an administrative role?

In my opinion she is currently unfit for work in light of her complex and unpredictable health conditions. Medical retirement is recommended for consideration.

2) If not please explain the reasons why and if there are any risks associated with her being in the workplace.

In my opinion, based on current information, there is risk of moderate to high level for significant aggravation of her symptoms if she remains in the workplace in regard to persistent musculoskeletal and neurological type symptoms, gut symptoms, fatigue in the setting of her complex psychological and physical presentation.

3) Does she have any capacity to continue working whilst The Employee Relations Unit progress with the impending retirement process?

Please see answers above. I am happy for her and her treating doctors to have a copy of this report if requested.

14      On 7 December 2017, a general practitioner, Dr Hui Tan, provided Ms Richardson with a medical certificate stating that she had been receiving medical treatment but is now recovered and is fit to return to full-time normal duties with immediate effect.

15      On 13 December 2017, Dr Powers provided a further supplementary report in which she answered the following questions:

1. In your opinion is Ms Richardson currently fit to work in a reduced capacity as per her previous return to work program at a maximum of 3 days, without the workload demands typically placed on a staff member of her level?

In my opinion, based on all current information available to me, she is currently totally unfit for work in light of her complex and unpredictable health conditions, with moderate to high level of risk if she was to remain in the work place of significant event/exacerbation of symptoms at work requiring medical intervention. Medical retirement is recommended for consideration.

2. Is Ms Richardson fit to be in the workplace in any capacity from a medical perspective? Please identify suitable restrictions/workplace accommodations.

Please see answer above.

3. Please further explain the risks that are associated with Ms Richardson continuing to be in the workplace, how significant these are and whether or not the workplace can do anything to mitigate these.

Please see answer to question 1. I am concerned in particular that there is significant increased risk of falls, musculoskeletal injuries and exacerbation of her symptoms in the setting of her persistent musculoskeletal and neurological type symptoms, gut symptoms and fatigue and her complex psychological and physical presentation. Altogether across her myriad of symptoms/illnesses and pathologies I estimate a moderate to high level of risk if she was to remain in the work place of significant event/exacerbation of symptoms at work requiring medical intervention.

4. If she is totally unfit to be at work in any capacity please explain why.

Please see answer above.

16      On 14 December 2017, general practitioner, Dr Robert Liddell-Melville, wrote to Ms Michelle Bryant, a vocational rehabilitation consultant employed by the respondent.  In the letter Dr Liddell-Melville stated he was totally opposed to any consideration of medical retirement (of Ms Richardson) and made the following points:

(a) He was one of Ms Richardson's treating doctors who had managed her for many years.

(b) Ms Richardson had come through an extremely challenging period with several medical conditions and now has every prospect of a normal working life.

(c) Ms Richardson developed complications relating to surgery and that has been responsible at least in part to her illness.  Ms Richardson is now through that period.

(d) Ms Richardson is exercising and has rejoined a volunteer bushfire brigade and has recommenced training with them.

(e) Ms Richardson lives on her own.  She is motivated and survived medical conditions that would have destroyed others.

17      On 22 December 2017, Acting Inspector Chris Hoath from the respondent's Forensic Fingerprint Bureau wrote to Ms Richardson to inform her that she was being placed on sick leave with immediate effect on grounds that Dr Powers had certified her to be unfit for work, and directed her not to attend work.  The letter stated as follows:

Outcome of Medical Appointment of 29 November 2017

You attended appointment with Western Australia (WA) Police Consultant Physician, Dr Powers on 29 November 2017. This appointment resulted in medical opinion being presented to WA Police Health and Safety Division that you are unfit for work and; that medical retirement should be considered.

You were made aware of the advice resulting from appointment of 29 November 2017 following your attendance, and copy of the associated medical report was sent to your treating doctor by WA Police's Health and Safety Division.

You subsequently returned to the workplace and given that prior to this appointment you had been undertaking a Return to Work Program working reduced hours, on adjusted duties, State Crime Division sought further advice from Health and Safety Division as to the impact of the outcome of this appointment upon your ability to continue attendance in the workplace (undertaking adjusted and/or alternative duties).

Two medical certificates where [sic] then submitted by you in support of your continued workplace attendance, these being certificate dated 7 December 2017 from Dr Hui Tan (Appendix 1), and letter dated 14 December 2017 from Dr Robert Liddell (Appendix 2). As a result, these documents were both submitted to Health and Safety Division for their review and consideration whereupon confirmation was provided to State Crime Division that Dr Powers previous report and opinion remained unchanged in respect your fitness to attend work and the appropriateness of progression of retirement on the grounds of ill health.

Requirement to commence Personal Leave (sick) effective immediately

On 21 December 2017 the Assistant Director Health and Safety Division provided advice to State Crime Division via HR Business Partner Robert Pavleski, that upon review of the medical information available to WA Police regarding your fitness to attend work, you are to be placed on personal (sick) leave effective immediately. This determination occurred due the health risks associated with you remaining in the workplace, as identified and represented by Dr Powers.

You are therefore not to attend work at this time, and until advised otherwise. You remain able to access any relevant leave entitlements available to you in line with Public Service and Government Officers CSA General Agreement 2017 and Public Service Award 1992. For advice as to your current paid leave entitlements please contact Personnel Services, via email Personnel.sickleave@police.wa.gov.au.

Referral for Retirement on the Grounds of Ill Health

I can also advise that Health and Safety Division has now referred your case to the Employee Relations Division (within HR) having recommended the commencement of progression of retirement on the ground of ill health as per policy HR-11.05 Retirement on the Grounds of Ill Health – Police Staff (Appendix 3).

Employee Relations Division will review the case whereupon authority will be sought from the Director of Human Resources as to decision of progression via this process which will include calling upon you to retire on the grounds of ill health under Section 39 of the Public Sector Management Act 1979.

18      On 8 January 2018, Ms Renae Lavell, Director of Human Resources, wrote to Ms Richardson and called upon her to retire on the grounds of ill health.  The letter instructed Ms Richardson to advise Ms Lavell, in writing, within seven days, whether she (Ms Richardson) accepted or rejected the call to retire, and to provide her own medical evidence within 28 days from the date of receipt of the letter in the event she did not accept the respondent's medical evidence.

19      On 15 January 2018, Ms Richardson by letter informed the respondent that she rejected the call to retire on medical grounds, and advised that she would provide her own medical evidence.

20      On 19 January 2018, the appellant wrote to the respondent and reiterated that Ms Richardson rejected the medical evidence of the respondent and stated that Ms Richardson had arranged an appointment with Dr Brian Dare, Occupational Physician, for 23 January 2018.  The appellant's letter also initiated the dispute settlement procedure in cl 52 of the 2017 General Agreement in respect of the decision to 'place' Ms Richardson on personal leave.

21      On 31 January 2018, the appellant wrote to the respondent stating that the dispute had escalated in accordance with cl 52.3 of the 2017 General Agreement and attached a copy of a report by Dr Dare dated 24 January 2018 in which Dr Dare concluded that Ms Richardson was fit to perform her full duties and that there were no grounds for retirement on the grounds of ill health.

22      On 7 February 2018, the appellant received an email advising that the respondent would reinstate the payment of Ms Richardson's salary effective from 31 January 2018 (being the date that Dr Dare's report was provided to the respondent).  The email also stated that there was now a dispute about the medical assessment and that the respondent would now seek a further report from an independent medical expert in accordance with the Ill Health Retirement Policy.

23      On 16 February 2018, the appellant filed application PSAC 5 of 2018.

24      On 11 April 2018, Ms Richardson attended a medical assessment with independent Consultant Occupational Physician, Dr Phillip Meyerkort.

25      On 30 April 2018, the respondent received and provided to the appellant a report by Dr Meyerkort in which it was concluded that Ms Richardson was fit to perform the full range of duties within her position description on a full-time basis without restriction.

26      Ms Richardson returned to the workplace in a full-time capacity on 11 May 2018. 

The issue in dispute before the Arbitrator

27      The Arbitrator found the question to be determined was whether the respondent was correct to act as it did by directing Ms Richardson to proceed on unpaid personal leave, having regard to the relevant provisions of the 2017 General Agreement, the respondent's policies and the terms of the Public Sector Commission Administrative Instruction 601.

The relevant provisions of the 2017 General Agreement, the Ill Health Retirement Policy and Administrative Instruction 601

(a) The 2017 General Agreement

28      Clause 5.8 of the 2017 General Agreement provides that (subject to cl 5.7 which is not applicable to the resolution of matters in this appeal) where the provisions of the applicable award (the Public Service Award 1992) and the 2017 General Agreement are inconsistent, the 2017 General Agreement will prevail.

29      Clause 22.1 of the 2017 General Agreement provides that the provisions of this clause (personal leave) replaces cl 31 - Short Leave, cl 27 - Carer's Leave, and cl 26 - Sick Leave of the Public Service Award.

30      Clause 22.24 of the 2017 General Agreement provides:

Reasonable and legitimate requests for personal leave will be approved subject to available credits. Subject to clause 22.8 the Employer may grant personal leave in the following circumstances:

(a) where the Employee is ill or injured;

(b) to provide care or support to a member of the Employee's family or household who requires care or support because of an illness or injury to the member; or an unexpected emergency affecting the member;

(c) for unanticipated matters of a compassionate or pressing nature which arise without notice and require immediate attention;

(d) by prior approval of the Employer having regard for Agency requirements and the needs of the Employee, planned matters where arrangements cannot be organised outside of normal working hours or be accommodated by the utilisation of flexi time credits by Employees working according to approved flexible working hours arrangements or other leave. Planned personal leave will not be approved for regular ongoing situations.

31      Clause 22.33 of the 2017 General Agreement provides:

If the Employer has reason to believe that an Employee is in such a state of health as to render a danger to themselves, fellow Employees or the public, the Employee may be required to obtain and furnish a report as to the Employee's condition from a registered medical practitioner nominated by the Employer. The Employer shall pay the fee for any such examination.

32      Clause 22.36 of the 2017 General Agreement provides:

Employees who have exhausted all of their personal leave entitlements and are ill or injured may apply for personal leave without pay. Employees are required to complete the necessary application and provide evidence to satisfy a reasonable person. The Employer shall not unreasonably withhold this leave.

33      Clause 22.37 of the 2017 General Agreement provides:

Personal leave without pay not exceeding a period of three months in a continuous absence does not affect salary increment dates, anniversary date of personal leave credits, long service leave entitlements or annual leave entitlements. Where a period of personal leave without pay exceeds three months in a continuous absence, the period in excess of three months is excised from qualifying service.

(b) Administrative Instruction 601

34      Administrative Instruction 601 – Sick Leave provides as follows:

1. Entitlement

Entitlements to sick leave are prescribed in the Public Service Regulations, 1988 and the Public Service Award, 1992.

2. Delegation

The chief executive officer has the authority to approve sick leave with pay to the extent of the officer's entitlement or without pay for any period.

3. Application

Applications for sick leave shall be submitted in writing.

4. Requirements of Certificate

a) Where the certificate of a registered medical practitioner or a registered dentist is required in accordance with Award provisions, such certificate must:

i) be on the normal letterhead stationery of the medical practitioner or dentist; and

ii) include the name of the officer for whom it is issued; and

iii) indicate the period during which the officer is or was unfit to perform his/her normal duties.

b) The chief executive officer may require the officer to obtain and provide a further certificate from a registered medical practitioner nominated by the chief executive officer and if that certificate does not confirm or substantially confirm the original certificate:

i) the officer making the application for sick leave shall pay the fee of the nominated registered practitioner in respect of the certificate; and

ii) if the sick leave had been approved with pay, such approval may be revoked.

Disciplinary action may also follow.

5. Officer Not Fit to Resume Duty

Where it appears unlikely that an officer will be fit to resume duty, the chief executive officer should give consideration to recommending to the Public Service Commissioner that the officer be retired on the grounds of ill health or that the officer's employment be terminated.

6. Officer Considered to be a Danger to Others

a) Where a chief executive officer has reason to believe that an officer is in such state of health as to be or to become a danger to colleagues or members of the public, the chief executive officer shall, in accordance with Award provisions, require the officer to obtain and provide a report as to his/her condition from a registered medical practitioner, or by a registered medical practitioner nominated by the chief executive officer. The fee for any such examination shall be paid by the department.

b) Upon receipt of the medical report, the chief executive officer may direct the officer to be absent from duty for a specified period, or if already absent on leave, the officer may be directed to continue on leave for a specified period. Such absence shall be regarded as sick leave.

7. Infectious Diseases

a) Upon report by a registered medical practitioner that, by reason of contact with a person suffering from an infectious disease and through the operation of restrictions imposed by Commonwealth or State law in respect of that disease, an officer is unable to attend for duty, the officer concerned may be granted sick leave or, at the option of the officer, the whole or any portion of the leave may be deducted from accrued annual leave or long service leave.

b) Leave shall not be granted for any period beyond the earliest date at which it would be practicable for the officer to resume duty, having regard to the restrictions imposed by law.

8. Credits for Previous Employment

a) Entitlements to claim credits for previous employment in a State body or statutory authority prescribed by Administrative Instruction 611 or in the service of the Commonwealth or of any other State of Australia, are prescribed in the Public Service Award.

b) This matter should be negotiated and documented as part of the recruitment process.

(c) HR-11.05 Retirement on Grounds of Ill Health – Police Staff

35      The policy is composed of three parts, the policy, procedures and guidelines.

36      The purpose of the policy, procedures and guidelines is to:

● Provide consistent advice about the management of employees whose health is believed to be significantly impacting on their ability to fulfil their work function

● Outline a consistent process for both employer and employee in dealing with the ill health retirement process.

37      The policy is 'to effectively manage employee health and welfare needs including where necessary, calling upon employees to retire on the grounds of ill health'.

38      The procedures (relevant to this appeal) are that:

Where WA Police is strongly of the opinion that an employee's:

a. Permanent or intermittent failure to attend work due to ill health

b. The employees inability to undertake the full range of duties within the appropriate position description

c. Sustained poor performance is directly attributed to the employee's ill health

d. Where there is sufficient evidence to suggest that an employee's sustained poor health poses a significant risk to the welfare of themselves and/or other staff or the public

the agency may seek its own medical advice as to the employee's ability to continue in current employment.

● Where that medical advice supports the employee's retirement on the grounds of ill health, WA Police may call upon the employee to retire in accordance with section 39 of the Public Sector Management Act 1994.

● Where WA Police has called upon an employee to retire in accordance with section 39 of the Public Sector Management Act 1994, WA Police shall also advise the employee to obtain advice from their superannuation fund.

● If the employee accepts the medical evidence but does not agree to retire on the grounds of ill health, the WA Police will instruct the employee to retire from the Public Service forthwith.

● Failure to retire forthwith, on the grounds of ill health, will be treated as failure to comply with a lawful order and may lead to disciplinary action being progressed.

● If the employee does not agree with the medical evidence, the employee may provide the agency with his or her own medical evidence. This medical evidence must be supplied within 28 days of being called upon to retire. Consideration may be given to extend the 28 day period upon application by the employee.

● If the employee's own medical evidence contradicts the agency's advice that the employee should retire on the grounds of ill health, a dispute will be recorded and the employee will be directed not to attend work. During this period the employee will remain on the same pay as they would have received had they not been directed to not attend work. The employee will not be required to attend work until revoked or until the medical advice supports the employee's safe return to work.

● If a dispute arises regarding the advice as to whether an employee should retire on the grounds of ill health, both the agency and employee must agree to a medical report being sought from an independent medical expert. That report will be commissioned and paid for by WA Police. The employee must attend any medical appointment arranged as part of this process.

39      Guidelines 1 and 2 provide:

1. At any time should WA Police deem there is sufficient evidence to suggest that an employee's sustained poor health poses a significant risk to the welfare of themselves and/or other staff, the agency may direct the employee not to attend work. During this period the employee will remain on the same pay as they would have received had they not been directed to not attend work. The employee will not be required to attend work until revoked or until the medical advice supports the employee's safe return to work.

2. At any point in the process, an employee can be required to attend medical appointment(s).

The Arbitrator's reasons for decision

40      After setting out the factual background and the issue in dispute, the Arbitrator made the following findings which are relevant to the disposition of this appeal:

(a) The first point to be considered is whether the terms of the 2017 General Agreement in relation to personal leave supported the respondent's decision in relation to Ms Richardson.

(b) Clause 22 of the 2017 General Agreement replaces short leave, carers' leave and sick leave provisions of the Public Service Award and combines them into one entitlement as personal leave.

(c) To the extent that cl 22.33 is inconsistent with cl 26(4) of the Public Service Award, insofar as the latter does not include reference to an officer being a danger to themselves, cl 22.33 of the 2017 General Agreement prevails.

(d) The provisions of the 2017 General Agreement as to personal leave do not enable an employer to 'place' or to direct an employee to proceed on personal leave.  To do so would require express provision which is absent.

(e) By cl 5 of 2017 General Agreement, the terms of the 2017 General Agreement and the Public Service Award are to be read together.  Both form part of the scheme as to the terms and conditions of employment for public servants in this State.  The presence of an express right of an employer to direct an employee to take annual leave and long service leave, with the sanction of disciplinary action if not complied with, reinforces the need for a corresponding express provision in either the 2017 General Agreement or the Public Service Award, or other instrument, for an employer to direct an employee to take personal leave.

(f) Whilst the respondent made much of the fact that as a matter of logic and common sense, the obtaining of a medical report under cl 22.33 of the 2017 General Agreement must be able to be acted upon, the absence of a right of the employer to place an employee on sick leave by the terms of the 2017 General Agreement itself, does not mean the employer may not take steps.  The facts of this case show that the employer may use the report to, for example, require a public service officer to retire on the grounds of ill health under s 39 of the Public Sector Management Act 1994 (WA) (PSM Act) or act in accordance with Administrative Instruction 601.

(g) By cl 5(1) of sch 5 of the PSM Act, the terms of Administrative Instruction 601 are preserved as a transitional instrument, until it is repealed by a Commissioner's instruction or by regulations under s 108 of the PSM Act.

(h) Administrative instructions, as continued in effect by cl 5(1), will continue to apply, subject to 'such modifications as are necessary'.  Phrases such as 'with such modifications as are necessary' and 'with such adaptations as are necessary' in legislation, extend beyond matters of mere nomenclature and description and may embrace substantive provisions:  Peninsular Group Ltd v Kintsu Co Ltd (1998) 44 NSWLR 534.

(i) Section 64(1) of the PSM Act provides that employment of a person in accordance with Commissioner's instructions as a public service officer is subject to any binding award, order or industrial agreement made under the IR Act.  Any conflict must be resolved in favour of the 2017 Agreement.  Section 64(1) of the PSM Act should be construed as a reference to both Commissioner's instructions and administrative instructions, as both instruments have the same character and effect.  Thus, any inconsistency between a prior administrative instruction made under the former Public Service Act 1978 (WA) and preserved by the PSM Act, must give way to the terms of any award or agreement made under the IR Act.  Any conflict must be resolved in favour of the 2017 Agreement.

(j) Both Administrative Instruction 601 and the sick leave provisions of the Public Service Award were plainly intended to be read together and to operate as part of a scheme.  Both cl 26(4) of the Public Service Award and Administrative Instruction 601 cover the circumstances of an employee being in such a state of ill health as to render themselves a danger to fellow officers and the public at large.  Both also refer to the employer's right to direct the employee to obtain a medical report.  Clause 6(b) of Administrative Instruction 601, however, goes a step further.  Clause 6(b) must be construed as meaning if cl 6(a) is satisfied, a chief executive officer has the authority to direct an employee to remain away from the workplace and such absence is to be regarded as sick leave.

(k) The only change introduced by the 2017 General Agreement in cl 22.3 (the form of which seemed to have been successive industrial agreements since at least 2006, if not earlier) is to enable the employer to direct a medical report to be obtained in circumstances where the employer considers the employee's state of ill health to be a danger to themselves, in addition to any danger to fellow employees or the public.

(l) Administrative Instruction 601 should be read as modified by cl 22.33 of the 2017 General Agreement, to include the situation where an employee is in such a state of ill health as to constitute a danger to themselves, as well as to fellow employees or the public.

(m) Whilst the terms of the Ill Health Retirement Policy in relation to 'procedures' and 'guidelines' are somewhat confusing, the policy does not assist the appellant in this case.  When the payment provision was triggered in this case, following the disputed medical reports being received (being the date of the receipt of Dr Dare's report by the respondent), Ms Richardson was paid accordingly.  The Ill Health Retirement Policy, when construed as a whole in accordance with its evident intention, does not support the payment of Ms Richardson at any point prior to the dispute arising on the medical reports.

(n) Accordingly, it was open for the respondent to rely upon the terms of the 2017 General Agreement read with Administrative Instruction 601 (to direct Ms Richardson not to remain at work and the absence to be regarded as sick leave).

41      For these reasons, the Arbitrator dismissed the application for relief sought by the appellant.

The grounds of appeal

42      In ground 1 of the appeal, it is contended that the Arbitrator made an error of law when he considered that it was open for the respondent to rely upon the terms of the 2017 General Agreement when read with Administrative Instruction 601.

43      In ground 2 of the appeal, the appellant contends that the Arbitrator made an error of law and fact when he concluded that the respondent's Ill Health Retirement Policy did not support the payment of Ms Richardson at any point prior to the dispute arising on the medical reports.

44      In ground 3 of the appeal, the appellant attempts to claim that it was denied procedural fairness in that the Arbitrator made an error of law by failing to consider the operation of s 26(3) of the IR Act with respect to the findings made as to the construction of Administrative Instruction 601.

Disposition of the appeal

45      The relevant provisions of the 2017 General Agreement make it clear that the terms of the Public Service Award that apply to sick leave are rendered inoperative whilst the 2017 General Agreement remains in force.

46      Importantly, the Arbitrator was correct to find that there is no right for an employer to direct an employee to take personal leave on grounds of ill health in cl 22 of the 2017 General Agreement.  Clause 22.24 only applies to applications for leave by employees.  Clause 22.32 and cl 22.33 only empowers an employer to direct an employee to submit to a medical examination.

47      As noted at [27] of these reasons the question was whether the respondent was correct to act as he did by directing Ms Richardson to proceed on unpaid personal leave, having regard to the relevant provisions of the 2017 General Agreement, the respondent's policies and the terms of Administrative Instruction 601.  It is not about other action the respondent may have taken under other legislation, instruments or regimes, but did not do so.  It is limited to the circumstances and the action actually taken by the respondent in the context of the instruments upon which he relied.

48      Whilst cl 26 of the Public Service Award does not apply whilst the 2017 General Agreement is operative, even if it could be said to apply by operation of the effect of Administrative Instruction 601 there is nothing in cl 26 of the Public Service Award that provided a power to direct an employee not to work and to take sick leave.

49      It was not in dispute at the hearing before the Arbitrator that Administrative Instruction 601 remains in force and effect.  The appellant, however, attempted to depart from this concession at the hearing of the appeal.  The appellant sought to argue that by operation of s 3 of the Public Service Act 1978 (repealed), the provisions of Administrative Instruction 601 that provides a power to public sector agencies to direct an employee to take sick leave have no effect, as Administrative Instruction 601 was inconsistent with the provisions of the Public Service Award.  This argument has no merit.  Leaving aside the effect of s 3 of the Public Service Act 1978 (in relation to which I do not find it necessary to make any finding) it is conceded by the appellant, cl 26 of the Public Service Award does not and did not contain any provision that allowed or allows public sector agencies to direct an employee to take sick leave.  Consequently, the argument sought to be put by the appellant is not open.

50      Prior to the enactment of the PSM Act, s 19 of the Public Service Act 1978 provided that the Public Service Commissioner may perform his or her functions by administrative instructions, published, notwithstanding s 41 of the Interpretation Act 1984 (WA), in public service notices but not in the Gazette.  Further, by operation of s 19, administrative instructions were deemed to be subsidiary legislation, but s 42 of the Interpretation Act did not apply to, or in relation to, them.

51      Pursuant to cl 5(1) of sch 5 of the PSM Act, administrative instructions continue in operation, with such modifications as are necessary, after commencement of the PSM Act until repealed by a Commissioner's instruction or regulations made under s 108 of the PSM Act.

52      The words 'with such modifications as are necessary' must be read as if the administrative instructions were made as Commissioner's instructions under the PSM Act and not modified at large, such as modified by any incorporation of the provisions of an industrial agreement made under the IR Act.  Insofar as the Arbitrator found otherwise in respect of the statutory text in cl 5(1) of sch 5 of the PSM Act ([40] - [41]), I respectfully do not agree with this approach.

53      The observations made by the New South Wales Court of Appeal in Kintsu does not support such a construction as applied by the Arbitrator.  In Kintsu, the New South Wales Court of Appeal was called upon to consider whether s 583 of the Corporations Law (Cth) (repealed) dealt with winding up of a company on grounds of insolvency where the company was a foreign company.  Section 583 of the Corporations Law provided that chapter 5 applied to a pt 5.7 body with such adaptations as are necessary.  Section 583 went on to prescribe an exclusive list of modifications that were found by the New South Wales Court of Appeal to constitute a code.  What was considered by the Court of Appeal was whether the provisions of chapter 5 of the Corporations Law applied to a foreign company. 

54      It was not in issue in Kintsu whether the provisions of any other instrument should apply to a foreign company.  Yet, this is the issue squarely raised in this matter.

55      It is clear that cl 5(1) of sch 5 of the PSM Act should be construed as applying necessary modifications to an administrative instruction to render such administrative instruction to be consistent with the effect of instructions issued by the Public Sector Commissioner.

56      When this approach is applied, it can be seen that insofar as cl 1 of Administrative Instruction 601 states that the entitlements to sick leave are prescribed in the Public Service Regulations 1988 and the Public Service Award, this provision is to be read as necessarily 'modified' because there are now no regulations that prescribe sick leave entitlements.  This provision could also be said to be modified by s 64 of the PSM Act.

57      Section 64 of the PSM Act provides:

(1) Subject to this section and to any binding award, order or industrial agreement under the Industrial Relations Act 1979 or employer‑employee agreement under Part VID of the Industrial Relations Act 1979, the employing authority of a department or organisation may in accordance with the Commissioner's instructions appoint for and on behalf of the State a person as a public service officer (otherwise than as an executive officer) on a full-time or part-time basis –

(a) for an indefinite period as a permanent officer; or

(b) for such term not exceeding 5 years as is specified in the instrument of his or her appointment.

(2) An appointment under subsection (1) shall be to such level of classification and remuneration as is determined by the relevant employing authority –

(a) in accordance with the Commissioner's instructions; and

(b) as being appropriate to the functions to be performed by the person so appointed.

(3) The employing authority of a department or organisation shall –

(a) in accordance with the Commissioner's instructions; and

(b) at the time of the appointment of a person under subsection (1) or, if that employing authority considers it impracticable to make the appointment concerned at that time, at a later time,

appoint the person to fill a vacancy in an office, post or position in the department or organisation.

(4) Subject to subsection (5), a person appointed under subsection (1)(b) cannot apply for an appointment under subsection (1)(a) unless the relevant vacancy has first been advertised as a public sector notice in accordance with the Commissioner's instructions or in a daily newspaper circulating throughout the State.

(5) Subsection (4) does not apply to a person –

(a) appointed under subsection (1)(b); and

(b) having, or occupying an office, post or position having, the lowest level of classification at which persons of the same prescribed class as that person are at the relevant time recruited into the Public Service.

(6) The employing authority of an organisation shall not make an appointment under subsection (1) unless the written law under which the organisation is established or continued authorises or requires the appointment or employment of public service officers for the purposes of that organisation.

(7) Nothing in this section prevents a public service officer who holds an office, post or position in one department or organisation from being appointed, whether by way of promotion or otherwise, to an office, post or position in another department or organisation.

58      Section 64 empowers an employing authority of a department to appoint public service officers, subject to any binding award, order or industrial agreement, in accordance with the Commissioner's instructions.  Whilst it is not necessary to decide the point, and without any argument on this point, I am not persuaded that it could be said by operation of s 64(1) of the PSM Act that any provision of an administrative instruction or a Commissioner's instruction that is inconsistent with the provisions of an award or industrial agreement is rendered inoperative by s 64(1) (see, for example, the relationship between, and the effect of, an award, order or industrial agreement and Commissioner's instructions in s 29(1)(h), s 30(b) and s 100(2) of the PSM Act.)

59      It is also not necessary to decide the point for the purposes of this appeal whether administrative instructions have ceased to be subsidiary legislation for the purposes of the Interpretation Act.  However, it is arguable that the effect of an administrative instruction is so modified by s 22A(7) of the PSM Act which provides that Commissioner's instructions are not subsidiary legislation for the purposes of the Interpretation Act.

60      It is clear, however, that cl 2 of Administrative Instruction 601 would have no operative effect as it would also be modified.  Prior to the enactment of the PSM Act, the Public Service Commissioner was the employer of all public service officers.  On coming into operation of the PSM Act, chief executive officers became the employers of public service officers in departments.  In these circumstances, cl 2 of Administrative Instruction 601 has no work to do as there is no necessity to delegate an employer's power (that is, the power of the former Public Service Commissioner as the employer of public service officers) to a chief executive officer, who by operation of the provisions of the PSM Act, are employing authorities of public service officers in departments.

61      When regard is had to s 64(1) of the PSM Act, Administrative Instruction 601 is to be construed as an instruction to the respondent as an employing authority that is to be complied with, together with the provisions of any binding award or industrial agreement.  As there is no binding award provision that applies whilst cl 22 of the 2017 General Agreement remains in force, the relevant instruments that applied to the conditions of sick leave of a public service officer in a position of Ms Richardson are Administrative Instruction 601 and cl 22 of the 2017 General Agreement. 

62      Clause 6 of Administrative Instruction 601 cannot be relied upon by the respondent to direct Ms Richardson not to attend work as cl 6(a) only applies where a chief executive officer has reason to believe that an officer is in such state of health as to be or to become a danger to colleagues or members of the public.  There is nothing in the PSM Act which would enable the scope of the direction given in Administrative Instruction 601(6) to be any wider.  Even if Administrative Instruction 601 is subject to and can be overridden by the provisions of cl 22 of the 2017 General Agreement, there is nothing in the 2017 General Agreement that enables an employer to direct a public service officer to be absent from duty on sick leave.

63      Importantly, when regard is had to the express terms of Administrative Instruction 601, there is nothing in the various medical reports that were considered by the respondent's officers prior to giving the direction to Ms Richardson on 22 December 2017 which indicate the state of health of Ms Richardson was such as to be or to become a danger to colleagues or members of the public.  All of the reports by Dr Powers that the respondent had before it on 22 December 2017 indicated only that Ms Richardson was at high risk if she was to remain at work of a significant event or exacerbation of her symptoms requiring medical intervention.

64      When regard is had to the medical reports of Dr Powers and to the medical evidence provided by Dr Tan and Dr Liddell-Melville, the Ill Health Retirement Policy had application to Ms Richardson as at the date that Acting Inspector Hoath sent the letter.

65      I do not agree that the Ill Health Retirement Policy did not require the respondent to pay Ms Richardson for the period from 22 December 2017 to 31 January 2018.

66      The express terms of the Ill Health Retirement Policy do not support a construction that it was not until Dr Dare's report dated 23 January 2018 was received by the respondent, there was a 'dispute' on the medical evidence as to whether Ms Richardson should retire on the grounds of ill health. 

67      Clearly, Ms Richardson had provided medical evidence upon which a 'dispute' arose prior to 22 December 2017.  The medical certificate provided by Dr Tan dated 7 December 2017 and the report of Dr Liddell-Melville dated 14 December 2017, constituted medical evidence and grounds upon which a 'dispute' could objectively be said to have arisen as contemplated by the sixth dot point of the procedures and guideline 1 of the Ill Health Retirement Policy.

68      Importantly, there is nothing in the Ill Health Retirement Policy that allows the respondent to direct an employee not to attend work without pay. 

69      The Ill Health Retirement Policy applies where there is sufficient evidence to suggest that an employee's sustained poor health poses a significant risk to themselves.  This was squarely the opinion of Dr Powers prior to 22 December 2017.

70      Of importance, in the letter dated 22 December 2017 to Ms Richardson directing her not to attend work, Acting Inspector Hoath stated that the process of retirement on grounds of ill health had commenced (in respect of Ms Richardson) as per the Ill Health Retirement Policy.

71      It is clear that as the respondent is a public sector employing authority, a model litigant and public sector employer, he should be bound by his policies and procedures.

72      Whilst the respondent attempted to raise an argument that relies upon the ordinary application of the 'no work, no pay' principle leads to a conclusion that there is no entitlement to wages, I am not satisfied that such an argument may be open on the facts that were before the Arbitrator:  Automatic Fire Sprinklers Pty Ltd v Watson [1946] HCA 25; (1946) 72 CLR 435.

73      Firstly, whilst there is an independence of service and wages in a claim for wages following a breach of contract by an employer, resulting in the discharge of employment of an employee, the industrial dispute referred for hearing and determination by the Arbitrator in this matter was not a claim for contractual benefits and turned on the effect of Administrative Instruction 601 and the 2017 General Agreement and the proper application of the respondent's Ill Health Retirement Policy.

74      Secondly, in Watson's case, an issue arises in respect of public service officers as to whether the terms of a person's employment provide that the payment of salary attaches to the office, or whether it is conditional on the performance of the duties of the office.  In the former case, the principle in Watson does not apply.  Whether Ms Richardson's terms of employment provides for salary that attaches to her office as a Level 2 Administrator was not a matter that was the subject of evidence nor argument before the Arbitrator (see the discussion on this point by G J McCarry, Aspects of Public Sector Employment Law (1988) pp 186 - 203).

75      For these reasons, I am on the opinion that ground 1 and ground 2 of the appeal have been made out.  I do not find it necessary to deal with the procedural fairness point raised in ground 3 of the appeal.

Conclusion

76      I would uphold the appeal and make an order to vary the decision of the Arbitrator by making an order that the direction given to Ms Richardson to be absent from duty from 22 December 2017 to 31 January 2018 be treated as, and recorded as, paid time (as if she had not been directed to not attend work in that period).

SCOTT CC:

77      I have had the benefit of reading the draft reasons of her Honour, the Acting President.  I agree with those reasons and have nothing to add.

MATTHEWS C:

78      I have had the benefit of reading the draft reasons of her Honour, the Acting President.  I agree with those reasons and have nothing to add.