WESTERN AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION

CITATION : 2019 WAIRC 00089

DELIVERED : THURSday, 21 February 2019

FILE NO. : B 52 OF 2018, B 53 OF 2018

Applicant

AND

BHP Billiton Iron Ore Pty Ltd

Respondent

Catchwords : Industrial Relations Law (WA) - Contractual benefits claim - Claim that written notification of shift roster change read with contracts impose benefit of maximum working hours   - Claim that work commences at main gate prior to handover of equipment - Interpretation of contracts - Principles applied - Maximum period of time specified to work under contracts may constitute a benefit - Contracts do not impose limitation as contended by applicants - Applications dismissed - Order issued

Legislation : Industrial Relations Act 1979 (WA)     

Result : Applications dismissed

Representation:

Counsel:

Applicants : Mr C Young as agent

Respondent : Mr R Dalton of counsel and with him Ms O Klimczak of counsel

Solicitors:

Respondent : Herbert Smith Freehills

Case(s) referred to in reasons:

Black Box Control Pty Ltd v Terravision Pty Ltd [2016] WASCA 219

Bowtell v Goldsbrough, Mort & Co Ltd (1905) 3 CLR 444

Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337

Hancock Prospecting Pty Ltd v Wright Prospecting Pty Ltd (2012) 45 WAR 29

Hotcopper Australia Ltd V David Saab (2001) 81 WAIG 2704

King v Griffin Coal Mining Company Pty Ltd (2017) 97 WAIG 527

Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165

Case(s) also cited:

Ahern v Australian Federation of Totally and Permanently Incapacitated Ex-Service Men and Women (WA Branch Inc) (1999) 79 WAIG 1876

Australian Broadcasting Commission v Australasian Performing Right Association Limited [1973] HCA 36

Australian Medical Association (WA) Incorporated v The Minister for Health [2015] WAIRComm 8

Balfour v Travelstrength Ltd (1980) 60 WAIG 1015

Brown v Northern Suburb Hebrew Congregation Inc [2013] WAIRComm 244

CFMMEU v Hay Point Services Pty Ltd [2018] FCAFA 182

Ferguson v TNT Australia Pty Ltd [2014] WAIRComm 21

Gartside v Qantas Airlines Limited [2013] WAIRComm 1083

GEC Marconi Systems Pty Ltd v BHP Information Technology Pty Ltd [2003] FCA 50

Joyce v Qantas Airways Limited [2014] WAIRComm 87

Landsheer v Morris Corporation (WA) Pty Ltd [2014] WAIRComm 34

MacDonald v Shinko Australia Pty Ltd [1999] 2 Qd R 152

Pacific Carriers Ltd v BNP Paribas [2004] HCA 35

Perth Finishing College Pty Ltd v Watts (1989) 69 WAIG 2307

Tamara Bartlett v Brumbys Coogee [2008] WAIRComm 750

Toll (FGCT) Pty Limited v Alphapharm Pty Limited (2004) 219 CLR 165

Tracey Ferguson v The Salvation Army [2014] WAIRComm 370

Triantopoulos v Shell Company of Australia Ltd [2011] WAIRComm 1083

Qantas Airways Limited v Joyce [2014] WAIRComm 1192

Reasons for Decision

The claims and introduction

1         The respondent, BHP Billiton Iron Ore Pty Ltd, mines iron ore in the Pilbara region of the State.  Mount Whaleback is a large open cut mine located close to the town of Newman. It is a complex mining operation and commenced approximately 52 years ago.  It operates on a traditional “truck and shovel” basis, whereby excavators dig material from predetermined mining locations in the pit, which material is then transported by truck to the mine crushers over a lengthy and complex network of haul roads. Mount Whaleback produces approximately 76 million tonnes of iron ore per annum.

2         The mine employs about 470 employees (the majority are employed directly by the respondent), most of whom reside in the local community.  Given the capital investment involved in the mining operations, Mount Whaleback operates on a 24 hour per day, seven days per week basis over the 365 days of the year. Two 12-hour shifts are worked by employees on a “back to back” basis 6 am/pm to 6 pm/am each day. The residential employees have worked on a 4/5 panel even time “lifestyle” roster since February 2018, following discussions with the workforce in late 2017. A part of the shift system, comprises a shift change process involving a “handover” and a “hot seat change”, the meanings of which have some significance and will be explored later in these reasons.

3         Two employees of the respondent, Mr Walton and Mr Frank, are the applicants in these proceedings. Both are equipment operators. They both claim that changes to shift rosters introduced by the respondent in February 2018, and prior, mean they are now required to work longer than their contracts of employment permit. In the case of Mr Walton, he claimed that his contract of employment obliged him to work no more than 42 hours per week. A consequence of the shift roster change is that he is now required to work longer. In the case of Mr Frank, he claims that the respondent now requires him to work greater than 12 hours per day (excluding changeover). One consequence of the 2018 change asserted by the applicants, is that there is an express reference in both cases, to a limit on their working hours to “12 hours plus handover”. Both applicants maintained that the respondent has denied them the benefit of their contracts of employment, that being not working more than these hours.  Declarations and orders are sought.

The mining operations and shift work system

4         The description of the mining operations including the summary outlined above, and the changes to the shift roster, were outlined in some detail by Mr O’Hanlon, the Manager Mining Production at Mount Whaleback. Mr O’Hanlon was previously the Manager Production and Planning at the mine. In his evidence Mr O’Hanlon was taken to exhibit R1, an aerial photo of the Mount Whaleback mine. This provided a general layout of the mine, including its working areas, waste dumps, park up areas and crib rooms. From the layout in exhibit R1, there are considerable distances between the mine front gate where all employees access the mine site and the various points within the mine to which employees are required to travel to commence work each day. Mr O’Hanlon estimated that it takes approximately 15 to 20 minutes to travel from the front gate to various active mining locations within the mine, depending on the mining configuration.

5         Mine haulage times vary from between 30 to 50 minutes from the pit to crushers and return, with the current average cycle time being approximately 27 minutes.  At the front gate of the mine employees enter via turnstiles where they “swipe in and out” electronically each day.  A photo showing the mine entry gate turnstiles was exhibit R2. Once through the turnstiles and behind a shade cloth area, there is a car park from which busses depart to transport employees to their work locations. On the left side after entering, are screens containing information in relation to what equipment employees will be operating and work locations for their upcoming shift (see exhibit R3). In summary, what occurs is employees pass through the turnstiles and check their equipment allocation for the shift displayed on the screens. This information is displayed on a rolling basis, which shows the operator’s name, equipment they are to be operating, such as a truck, and the location to access the equipment. This may be by way of a boarding ramp (see exhibit R6), in which case transport is by bus to the relevant crib room location. Another means of equipment access is by slip lane.  In this case, employees generally travel to the location in a light vehicle as directed by their supervisor. At the time the employees access the screens for information, they may also be spoken to by supervisors or geologists and given information and instructions relevant to their upcoming shift.

6         A typical crib room location is the Rabbit’s Flat crib room, on the far west of the mine layout as marked on exhibit R2. A copy of a photo of this building described by Mr O’Hanlon as typical of crib rooms at the mine, was exhibit R4.  The typical setup is a demountable crib room, park up areas for trucks and boarding ramps.  The boarding ramps are positioned at the level of a truck cab to allow a “hot seat change”.  This involves the interchange of drivers of equipment whilst the machine is in operational mode. The other method of operator changeover is, as mentioned, the use of slip lanes, which are located on the haul routes and enable the drivers to change over “off circuit”. Trucks may also be parked in park up areas, awaiting changeover of operators.

7         In terms of bus transport, employees are required to be at the mine site gate prior to the bus departure time which is 5.40 am/pm. Mr Frank testified that this means he would need to be at the gate by 5.20 to 5.30 am/pm to enter the site, check the screens, receive any necessary information and instructions and be ready to board the bus. As an excavator operator, Mr Frank is also required to find a light vehicle which is then driven to the swap out location. Shift changeover for excavator operators is by way of a hot seat change in the active mining areas.

8         The evidence was that the prestart (Safety Information Management System – or SIMS) commences at 6 am/pm and is normally conducted on the bus. This prestart is the nominal shift commencement time. Mr O’Hanlon estimated that normally the SIMS takes approximately four to ten minutes, but the respondent aims for an average time of about six minutes.  Just prior to this, employees have a small amount of time to get refreshments for their shift from the crib huts and to assemble prior to the commencement of prestart. Once employees have completed the necessary preliminaries they proceed to the relevant boarding ramp or park up area to get into their designated vehicle. In terms of outgoing employees, the respondent aims to have them on buses to depart between 6.10 am/pm to 6.15 am/pm, to return to the mine front gate.

9         The overall objective of the shift change process is to minimise the time taken so that the mining equipment is operating in production mode for as long as possible on each shift. In this respect, a bar chart tendered as exhibit R13 showed that since changes have been made to the shift change over process, by moving the designated start point to crib rooms and the introduction of boarding ramps and changes to bus timetables, total time involved in shift changeovers per truck has fallen from an average of 366 hours per annum in late 2013 to 58 hours per annum in late 2018. Another consequence of the shift changeover procedures, and 15 minute earlier start time of 6 am/pm to 6.00pm/am, appears to be that employees, including the applicants, have spent fewer total hours on site over the period 2012-2018. This was reflected in the swipe gate records tendered as exhibit R14 and an overall derivative summary document of site access records tendered as exhibit R16. When these contentions were put to him, apart from a few cases where adverse weather or equipment breakdown may have had an impact, Mr Frank accepted that this appeared to be the case.

10      As an overall assessment of the impact of the applicant’s claims, if the limitations contended by them applied across the truck fleet, Mr O’Hanlon estimated that the total cost in terms of unproductive time, could be approximately 600 hours per truck per annum in lost production. Over the total truck fleet this is the equivalent of 6 extra haul trucks at a cost of $2.1 million per truck in lost production or $12 million per annum for all six trucks, plus the capital cost of each truck, at approximately $20 million each.

Contracts of employment

11      As a part of the statement of agreed facts in this case, a copy of the applicant’s written contracts of employment and the letter advising of the variation to shift rosters were annexed. In both claims, the contract documents comprise a standard covering letter of offer enclosing an attached Staff Contract of Employment. It appeared not to be in dispute that the attachment to the letter of offer had contractual effect, which it plainly does. For Mr Walton, the relevant provisions of his contract of employment dated 18 August 2009, which are the Hours of Work and Remuneration clauses, are in the following terms:

HOURS OF WORK

It is expected that your work in this position will be completed on the basis of 42 hours per week. Circumstances may require you to work outside your normal hours to ensure that the full requirements of your role are met. This has been taken into account in setting your Base Salary and Operational Components 1 and 2 where applicable.

It is a requirement that you will perform shift work if required. Additionally, in order to meet operational requirements, the Company reserves the right to, from time to time, change the shift system in operation or require you to transfer from day work to shift work, from shift work to day work or from one shift to another.

REMUNERATION

Base Salary Component

Your commencing base salary will be $77 500 per annum which has been set to reflect the requirements of the job including consideration for unscheduled additional hours as required by this position from time to time. The salary also incorporates consideration for all aspects of working at site operations.

Your salary will be paid fortnightly, directly into your nominated bank, building society or credit union account.

Salaries are reviewed annually and are adjusted at the Company's discretion to take into account the Company's performance, your individual performance and industry salary movements generally. Your salary will next be reviewed in 2010.

Operational Component 1

In consideration of all the additional work time directly associated with your shift roster (eg. handover, hot seat changes, 40-42 hours etc.) you will receive Operational Component 1 of $10 276 per annum paid pro rata on a fortnightly basis.

Defined Salary

Your defined salary of $87 776 is the salary for Superannuation and Incentive Program purposes. This salary is calculated by adding Operational Components (where applicable) to your Base Salary.

Shift Component

For the requirement to perform shift work in accordance with the current shift requirements and roster pattern which operates in your department you will receive a Shift Component of $19 375 per annum which will be paid fortnightly on a pro rata basis in consideration of the demands of this roster.

Total Salary

This is the sum of all applicable remuneration components.

12      In the case of Mr Frank, his contract of employment documents dated 20 May 2010 are in the same terms.

Shift changes and variations

13      As mentioned at the outset of these reasons, the applicants contended that a change to their shift roster as discussed in the workplace in late 2017 and introduced in February 2018, has led to them working more hours than are prescribed by their contracts of employment. To put the variation to the shift roster in context, it is helpful to sketch the prior changes to shift changeover arrangements that occurred in 2012 and 2014.

14      Prior to about mid-2012, operations employees at Mount Whaleback swiped in at the main gate as they do now.  However, instead of getting buses or light vehicles to the relevant work areas, employees were able to drive their own vehicles to a location known as a “shift change building”.  Employees had to be at this location by 6.15 am/pm, as the then nominal shift start time.  At this location, employees undertook the prestart (SIMS). The same process that now occurs at the front gate, i.e. the reading of screens and the receiving of information and instruction from supervisors and geologists etc, took place at the shift change building.  Employees then travelled into the pit by bus or light vehicle. Mr Frank agreed that under this system employees still had to get to the shift change building by 6 am/pm.

15      In mid-2002, because of safety considerations, employees were no longer permitted to drive their own vehicles onto the mine site. Buses were used instead, and they departed the main gate between 5.55 am/pm to 6.05 am/pm to get to the shift change area. This required employees to be at the main gate in time to catch one of the buses. The buses then departed the shift change point at 6.15 am/pm and the SIMS took place on the bus, en route to the designated work area. This change was set out in a presentation to the employees (see exhibits R9 and R10).  The respondent’s objective at the time with these changes was to have employees on their equipment by about 6.30 am/pm.

16      In early 2014, the requirement for employees to be transported to a shift change building in the mine was removed. Instead, the process that occurred at the shift change building, that being the allocation of work areas, equipment and provision of relevant information, moved to the front gate, which is the current procedure.  At the same time, in response to employee preferences, the nominal start time was brought forward from 6.15 am/pm to 6 am/pm. This meant that, to catch the buses in time to get to the designated starting points in the mine by about 6 am/pm, employees would be required to be at the mine gate in time to read the information screens and be on the bus for departure at 5.40 am/pm. Following the usual SIMS process and equipment handover by about 6.05 am/pm to 6.10 am/pm, employees would be expected to be operating the equipment shortly after.

17      These changes to shift start arrangements were also covered in the evidence of Mr Frank.  After being taken through the stages of the changes from prior to 2012 to early 2014, Mr Frank accepted that they had led to improvements in the way the respondent had managed shift changeovers. The data put in evidence as to time spent on the mine site by employees, showed that generally, employees have been able to leave the mine site more promptly than under former arrangements.  Mr Frank accepted that it was not part of the applicants’ cases, that changes made prior to 2017, that being the shift roster change, were in some way outside of the applicants’ contracts of employment at that time.

18      The 2017 shift roster variation was set out in a letter to the applicants dated 7 November 2017. Relevantly, formal parts omitted, that letter was in the following terms:

ROSTER CHANGE

In October 2017, it was announced that Whaleback will implement changes to the operational rosters undertaken by our residential, frontline workforce. These changes aim to implement a simplified suite of rosters to improve integration and alignment across departments, manage fatigue, improve productivity and enable a culture of high engagement and flexibility for our workforce.

The following letter outlines the details of your new roster arrangement, including any impacts to the terms and conditions of your employment.

Roster Arrangement

As you transition from your current roster pattern to your new roster pattern, your working days will be adjusted to ensure a smooth transition . Please refer to the attached roster pattern for your rostered working days through this period.

Terms and Conditions

Your current terms and conditions of employment, including remuneration remain unchanged.

Should you have any questions regarding this change, please continue to discuss with your leader in the first instance. Our Employee Assistance Program, a free, confidential. third party counselling service is also available to you and your family members, in person in Newman or via phone on 1800 30 30 90.

Thank you for your continued contribution and commitment and I look forward to a smooth transition.

19      It was not contended by the applicants that the shift roster change set out above, was not permitted by the applicants’ contract of employment. In his evidence, Mr Frank accepted that the change introduced at this time, only affected the shift roster and all else remained the same.

Contentions of the parties

20      In short, the applicants submitted that the 2017 roster variation imposed a restriction on the respondent to the effect that their shift hours were to be “12 hours plus handover”. In context, the applicants contended that “handover” means the same thing as a “hot seat change” and refers to the physical handover of a piece of equipment from one operator to another.  The applicants maintained that in effect, by arriving at the main gate in time to catch a departing bus at 5.40 am/pm and being required to accept instructions and review allocation screens, they are “working” from this time. As this occurs prior to the actual “handover” of the equipment, either a truck or excavator, to the incoming shift worker, then according to the applicants, they are working about 12.5 hours per day “plus handover”. On the applicants’ construction of their contracts of employment, they are only obliged to work a maximum of 12 hours per shift plus handover. This benefit of a maximum number of working hours per shift, has been denied to them by the respondent, as the argument went.

21      The respondent maintained that the applicants could not make out their contention that words used in the 2017 shift roster variation letter being “12 hours plus handover” established any entitlement and imposed a restriction on the respondent in terms of the handover process from one shift to another. The respondent maintained that the one line relied on by the applicants in the 2017 roster variation letter, must be read in the context of the applicants’ contracts of employment, when read as a whole. The 2017 variation, when it referred to “handover”, must be understood in the context of how shift changeovers have been performed at Mount Whaleback as an established process over a lengthy period. The submission was that this has always involved a designated starting point and a nominated shift start time, with one being referable to the other. The respondent therefore contended that the shift changeover arrangement has not changed since 2014. This system is part of the “current roster arrangement” referred to in the 2017 shift roster variation letter.

22      In other respects, the respondent also submitted that the relevant terms of the applicants’ contracts of employment, should be read expansively and not in a restrictive fashion, as contended by the applicant. So construed, the respondent contended that there is ample scope in the applicants’ contracts of employment to accommodate their current working arrangements.

Consideration

23      The principles in relation to denied contractual benefits claims are well settled.  The relevant claim must relate to an “industrial matter”; the claimant must be an employee; the claimed benefit must be a “contractual benefit” as being one to which the employee is entitled under their contract of service; the relevant contract must be one of service; the benefit must not arise under an award or order of the Commission; and the benefit must have been denied by the employer: Hotcopper Australia Ltd v David Saab [2001] WAIRC 00102; (2001) 81 WAIG 2704 at 2707.

24      As to the approach to the interpretation of contracts generally, in King v Griffin Coal Mining Company Pty Ltd (2017) 97 WAIG 527 I said at pars 11-13 as follows:

11 Some rules have been developed in the cases as to the approach to adopt in construing the terms of a contract. A recent summary of the relevant principles to be applied was set out by the Court of Appeal (WA) in Black Box Control Pty Ltd v Terravision Pty Ltd [2016] WASCA 219. In this case, Newnes and Murphy JJA and Beech J observed at par 42:

Construction of contracts: general principles

42 The principles relevant to the proper construction of instruments are well known, and were not in dispute in this case. In summary:

(1) The process of construction is objective. The meaning of the terms of an instrument is to be determined by what a reasonable person would have understood the terms to mean.50

(2) The construction of a contract involves determination of the meaning of the words of the contract by reference to its text, context and purpose.51

(3) The commercial purpose or objects sought to be secured by the contract will often be apparent from a consideration of the provisions of the contract read as a whole.52 Extrinsic evidence may nevertheless assist in identifying the commercial purpose or objects of the contract where that task is facilitated by an understanding of the genesis of the transaction, its background, the context and the market in which the parties are operating.53

(4) Extrinsic evidence may also assist in determining the proper construction where there is a constructional choice, although it is not necessary in this case to determine the question of whether matters external to a contract can be resorted to in order to identify the existence of the constructional choice.54

(5) If an expression in a contract is unambiguous and susceptible of only one meaning, evidence of surrounding circumstances cannot be adduced to contradict its plain meaning.55

(6) To the extent that a contract, document or statutory provision is referred to, expressly or impliedly, in an instrument, that contract, document or statutory provision can be considered in construing the instrument, without any need for ambiguity or uncertainty of meaning.56

(7) There are important limits on the extent to which evidence of surrounding circumstances (when admissible) can influence the proper construction of an instrument. Reliance on surrounding circumstances must be tempered by loyalty to the text of the instrument. Reference to background facts is not a licence to ignore or rewrite the text.57 The search is for the meaning of what the parties said in the instrument, not what the parties meant to say.58

(8) There are also limits on the kind of evidence which is admissible as background to the construction of a contract, and the purposes for which it is admissible. Insofar as such evidence establishes objective background facts known to the parties or the genesis, purpose or objective of the relevant transaction, it is admissible. Insofar as it consists of statements and actions of the parties reflecting their actual intentions and expectations it is inadmissible. Such statements reveal the terms of the contract which the parties intended or hoped to make, and which are superseded by, or merged into, the contract.59

(9) An instrument should be construed so as to avoid it making commercial nonsense or giving rise to commercial inconvenience.60 However, it must be borne in mind that business common sense may be a topic on which minds may differ.61

(10) An instrument should be construed as a whole. A construction that makes the various parts of an instrument harmonious is preferable.62 If possible, each part of an instrument should be construed so as to have some operation.63

(11) Definitions do not have substantive effect. A definition is not to be construed in isolation from the operative provision(s) in which the defined term is used. Rather, the operative provision is ordinarily to be read by inserting the definition into it.64

12 One question addressed in this matter was the most recent debate in the cases in relation to the need for ambiguity or differences in meaning, in order for a court to have regard to extrinsic evidence. This arises from the principles discussed in Codelfa Construction Pty Ltd v State Rail Authority of New South Wales (1982) 149 CLR 337. In this case, Mason J, in what is described as the “true rule” said at par 22:

22 The true rule is that evidence of surrounding circumstances is admissible to assist in the interpretation of the contract if the language is ambiguous or susceptible of more than one meaning. But it is not admissible to contradict the language of the contract when it has a plain meaning.

13 As to the application of the “true rule”, in Hancock Prospecting Pty Ltd v Wright Prospecting Pty Ltd (2012) 45 WAR 29 McLure P observed as follows at pars 74-80:

The scope of the “true rule” of construction

74 Both parties rely on extrinsic material in support of their submissions as to the proper construction of the 1984 and 1989 Agreements. Accordingly, it is necessary to enlarge on the scope of the “true rule” in Codelfa.

75 The role of the court in construing a written contract is to give effect to the common intention of the parties. The common intention of the parties is to be ascertained objectively. That is, the meaning of the terms of a contract in writing is to be determined by what a reasonable person would have understood them to mean: Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165. The subjective intention or actual understanding of the parties as to their contractual rights and liabilities are irrelevant in the construction exercise.

76 The practical limitation flowing from the Codelfa true rule is that surrounding circumstances cannot be relied on to give rise to an ambiguity that does not otherwise emerge from a consideration of the text of the document as a whole, including whatever can be gleaned from that source as to the purpose or object of the contract.

77 The word “ambiguous”, when juxtaposed by Mason J with the expression “or susceptible of more than one meaning”, means any situation in which the scope or applicability of a contract is doubtful: Bowtell v Goldsbrough, Mort & Co Ltd (1905) 3 CLR 444, 456 - 457. Ambiguity is not confined to lexical, grammatical or syntactical ambiguity.

78 Moreover, the extent to which admissible evidence of surrounding circumstances can influence the interpretation of a contract depends, in the final analysis, on how far the language of the contract is legitimately capable of stretching. Generally, the language can never be construed as having a meaning it cannot reasonably bear. There are exceptions (absurdity or a special meaning as the result of trade, custom or usage) that are of no relevance in this context.

79 Further, on my reading of Codelfa, pre-contractual surrounding circumstances are admissible for the purpose of determining whether a term is implied in fact. That may be because the stringent test for the implication of a term in fact excludes any possibility of an implied term contradicting the express terms.

80 If extrinsic evidence is admissible, the next issue is the scope of the “surrounding circumstances” for the purpose of construction. Mason J in Codelfa also answered that question. He said:

“Generally speaking facts existing when the contract was made will not be receivable as part of the surrounding circumstances as an aid to construction, unless they were known to both parties, although … if the facts are notorious knowledge of them will be presumed.

It is here that a difficulty arises with respect to the evidence of prior negotiations. Obviously the prior negotiations will tend to establish objective background facts which were known to both parties and the subject matter of the contract. To the extent to which they have this tendency they are admissible. But in so far as they consist of statements and actions of the parties which are reflective of their actual intentions and expectations they are not receivable (352).”

25      I am prepared to accept, and the respondent concedes, in my view properly so, that a limit on the time over which an employee may be required to work could constitute a “benefit” under s 29(1)(b)(ii) of the Industrial Relations Act 1979 (WA). Nonetheless, such a restriction or limitation must still be found in the terms of the contract itself, express or implied. An applicant must also establish, even if the threshold requirements above have been met, that the relevant benefit has been denied. For the applicants to succeed in relation to the denied contractual benefit claims they assert, they need to be able to identify with certainty and precision, the entitlement to work “not more than” the maximum hours contended and the contractual basis for this. 

26      The applicants place most reliance on the words in the 2017 roster variation letter “12 hours plus handover”. As I understood the applicants’ contentions, it was submitted that at least for the two applicants, this was the first occasion where specific reference was made in writing to shift length and in some manner, this constituted a contractual limitation on the applicants’ hours of work, despite the evidence that shifts have for a long time, been 12 hours in length.

27      It needs to be noted at this point, that the letters of 7 November 2017 to the applicants, were about the notification of a change in roster. This notification of change in roster was in accordance with the second paragraph of the Hours of Work clause in the applicants’ contract of employment documents, as set out above. So characterised, the letters from the respondent to the applicants, about which there seems to have been considerable discussion on site in late 2017, involved the exercise by the respondent of a contractual right to change the shift system in operation at Mount Whaleback for “residential frontline workers”, as described in the letter.

28      The purpose of the letter, from the first paragraph, was to inform the applicants of the reasons for the change in rosters and what the new roster would be. The terms of the new “roster arrangement” were outlined. Under that heading, the letter was clearly intended, in my view, to provide a short summary of the proposed change for the information of the recipient. The reference to shift length of “12 hours plus handover” does not appear to be a change in any meaningful sense. The evidence of all those who testified in this case, was that the production employees at Mount Whaleback have always, over at least recent history, worked two 12 hour shifts back to back, seven days per week all year round. The start and finish times were not changed. Importantly, there is reference to the “roster arrangement” on two occasions in the letter. The letter expressly states that current “terms and conditions of employment including remuneration, remain unchanged”. This tends to emphasise the purpose of the letter as relating to notification under the applicants’ contracts of employment of the change of roster.

29      It is trite to observe that contracts are generally not forged in a vacuum. As is noted in Blackbox Control, cited above, background and context are important, especially in the case of ambiguity in terms of contracts. An important part of the background and context in this case, is arrangements for shift changeovers at Mount Whaleback. This is so because the mine is a large and complex operation.  One is not dealing with employees arriving at work at a shop, factory or office building. It was clear on the evidence, and it seemed well understood by those who gave evidence and from the considerable documentary material in evidence too, that the process of a shift changeover for operations employees at Mount Whaleback is a significant logistical exercise involving the movement of a substantial number of people in a coordinated fashion to achieve a change in operators of trucks and excavators in the most efficient manner possible. Various iterations of the shift change process were outlined in the evidence, from prior to 2012, in mid-2012 and from early 2014.

30      In short and simply put, what has changed over this period is that instead of employees driving themselves to the designated shift start points, they are now transported in buses and light vehicles. Secondly, instead of receiving information from screens as to work locations etc at designated start points, they now receive that information at the front gate, when swiping in at the turnstile.  On either system, employees still had and now must arrive at the mine in time to either formerly drive themselves to the designated start point or now, to get the bus or light vehicle to the same location. The evidence seemed to be, and I accept, that one consequence of these changes since 2012, is that now, employees spend less time on the mine site in total, not more.

31      It is in this context that the concept of a “handover” must be understood.  It is not a term defined in the contract of employment documents. It is referred to separately from “hot seat change” and in my view is not to be regarded as synonymous with the latter concept. Its meaning is informed by practice and custom on the site. That is, the concept of a “handover”, should be construed as part and parcel of the shift change process. To divorce the concept of handover and to isolate it in some way from the process of a change from one shift to another at Mount Whaleback, is in my view, not in accordance with what a reasonable person in the position of the parties to the transaction, at the time they entered into it, that being the shift roster variation, and with the knowledge they then possessed, would conclude. It was common ground that the process of handover, so construed, as part of the shift change as it now operates, had been in place for nearly five years at the time of the hearing of these proceedings. Thus, the words in the roster change variation letter, “Shift Length: ….. 12hrs plus handover”, are to be understood in this context. Whilst nominally so, the total length of a shift is not limited to just 12 hours, as it includes the “handover” process too.   

32      In view of these observations, I return then to the specific terms of the applicants’ contracts of employment. The first thing to note in relation to the contracts as a general observation, is that they are drafted in language which expresses breadth of meaning and not limitation. Nowhere is it stated in the Hours of Work provision for example, that there is a “maximum” or “not more than” or words to this effect, where reference is made to, for example, “normal hours” as 42 per week. The clause starts with the words “it is expected that …”. The paragraph then goes on to state that “Circumstances may …”. Again, these are words of expansion and not of contraction. Importantly, the last sentence, which reads “This has been taken into account in setting your Base Salary …” makes it clear in my view, that the Hours of Work clause and the Remuneration clause of the contracts are to be read together.

33      Accepting this to be correct, I move then to the Remuneration clauses in the contracts of employment. I start with the last subclause first, that dealing with the Shift Component. Shift work is an essential feature of the operations at Mount Whaleback. The words “in accordance with the current shift requirements and roster pattern” sensibly understood, must include, again taken in context, not only the demands of night shift and the disabilities associated with it, but also the “shift requirements”.  The words “shift requirements”, in my view, must be taken to also include the arrangements necessary to attend for the relevant working shift, whether it be day or night shift.

34      The Operational Component 1 clause has an even more emphatic link between the salaries paid to the applicants and their hours of work. This subclause directly refers to “all additional work time directly associated with your shift roster”. It must be the case that getting to the designated start point, at the beginning of a shift, in the context of a large and complex open cut mining operation, from the front gate, is time “associated with” a shift roster.  In my view those words are in and of themselves, broad enough to cover time spent by employees getting from the mine main gate to the designated start point, as a part of the shift change process. This conclusion implicitly accepts the applicants’ contention that when receiving instructions and reading information after having entered the mine site, employees are at work and are working. In my view such instructions and taking directions as to work could only be reasonably seen as lawful directions given by the respondent to employees, as an incident of the common law contract of employment. 

35      Moreover, the language that follows in this same sentence is even more specific, when it refers by way of example to “handover, hot seat change, 40-42 hours etc …”.  I have already discussed above my view as to how “handover” should be construed. In the case of excavators and in some cases trucks too, on the evidence, a hot seat change occurs where the outgoing operator gets out of the machine and the incoming operator gets into it, whilst it is in operating mode.  This is of course, to minimise non-productive time and in the case of excavators, occurs in active mining locations in the pit. Thus, this has a specific and well understood meaning. Logically, again in the context of the evidence, “additional work time associated with” a hot seat change, must include the time to get from the mine entrance to the location of the machine, having regard to the nominal shift start time of 6 am/pm. This must mean, in the context of the evidence in these proceedings, the need to be at the location of the buses for a 5.40 am/pm departure, all of which is time “associated with” this process.

36      As to the Base Salary component subclause, I accept the applicants’ contention that the words “unscheduled additional hours” are not applicable in this case.  This contemplates, for example, an unplanned interruption to operations of some kind that may require an employee to work additional hours. This could be weather related, a breakdown or some such event. This is not the case here. However, other aspects of this clause, such as the words “considerations for all aspects of working at site operations”, are very broad in scope.

37      When one considers these provisions of the applicants’ contracts of employment as a whole, which one must do, and accepting the contention that the applicants, when “swiping in” at the turnstiles and receiving information and instructions about the shift work ahead, are “working”, there is ample to conclude that such time on the mine site when engaging in such activities, is within the scope of the applicants’ contracts of employment. It is for the applicants to establish that their contracts of employment contain the claimed limitation on working hours and that this limitation has been denied to them by the respondent. I am not persuaded that the applicants have established this.

Other issues

38      The respondent also raised two other contentions in their submission. The first related to the effect of s 23(3) of the Act on the applicants’ claim. The second related to the operation of s 26(1)(a) and (d) of the Act.  Given my conclusions in relation to the applicants’ denied contractual benefits claims, it is not necessary for me to consider these issues further.

Conclusion

39      For the foregoing reasons the applications must be dismissed.