2024 WAIRC 01067
INTERPRETATION OF THE WESTERN AUSTRALIAN TAFE LECTURERS’ GENERAL AGREEMENT 2021
WESTERN AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION

CITATION : 2024 WAIRC 01067

CORAM
: COMMISSIONER C TSANG

HEARD
:
THURSDAY, 29 FEBRUARY 2024

DELIVERED : FRIDAY, 20 DECEMBER 2024

FILE NO. : APPL 71 OF 2023

BETWEEN
:
THE STATE SCHOOL TEACHERS' UNION OF W.A.
Applicant

AND

GOVERNING COUNCIL OF NORTH METROPOLITAN TAFE, GOVERNING COUNCIL OF SOUTH METROPOLITAN TAFE, GOVERNING COUNCIL OF CENTRAL REGIONAL TAFE, GOVERNING COUNCIL OF NORTH REGIONAL TAFE, GOVERNING COUNCIL OF SOUTH REGIONAL TAFE, DIRECTOR GENERAL OF THE DEPARTMENT OF TRAINING AND WORKFORCE DEVELOPMENT
Respondents

CatchWords : Application for declaration of the true interpretation of an industrial agreement – Whether employee absent from work and receiving workers’ compensation payments entitled to accrue annual leave – Whether provisions of the agreement have the effect of limiting annual leave entitlements – Whether ambiguity exists – Whether Administrative Instruction 610 is admissible – Whether s 23(1) of the Minimum Conditions of Employment Act 1993 (WA) entitling employees to paid annual leave for each ‘year of service’ is implied into the agreement to include a period when an employee is absent from work and receiving workers’ compensation payments
Legislation : Industrial Relations Act 1979 (WA) ss 46, 46(1)(a), 46(1)(b)
Interpretation Act 1984 (WA), s 56
Minimum Conditions of Employment Act 1993 (WA) ss 5(1), 5(2), 9A(1), 9A(2), 9A(4)(c), 23, 23(1)

Workers’ Compensation and Injury Management Act 1981 (WA) ss 5, 18, 80(1), 80(2), 84AA(1), Schedule 1 – ss 7(5), 11(2)   
Instrument : Western Australian TAFE Lecturers’ General Agreement 2021
Result : Application dismissed
REPRESENTATION:

APPLICANT : MR D RAFFERTY (OF COUNSEL)
RESPONDENT : MR J CARROLL (OF COUNSEL)

Cases referred to in reasons:
Black Box Control Pty Ltd v Terravision Pty Ltd [2016] WASCA 219
Brett v Sharyn O’Neill, Director General, Department of Education [2015] WASCA 66
Browne v Director General, Department of Water and Environmental Regulation [2020] WASCA 16
Director General, Department of Education v United Voice WA [2013] WASCA 287
Fedec v The Minister for Corrective Services [2017] WAIRC 00828
FreshFood Management Services Pty Ltd v “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) [2023] FWCFB 97
Graham v Baker [1961] HCA 48
Hall v Medical Imaging Queensland Pty Ltd [2015] FCCA 326
James Cook University v Ridd [2020] FCAFC 123
Jones v Barminco Pty Ltd (2001) 81 WAIG 1183
Minister for Corrective Services v Western Australian Prison Officers’ Union of Workers [2023] WAIRC 00909
Minister for Corrective Services v Western Australian Prison Officers’ Union of Workers [2024] WAIRC 00758
Minister for Corrective Services v Western Australian Prison Officers’ Union of Workers [2024] WAIRC 00825
Minister for Corrective Services v Western Australian Prison Officers’ Union of Workers; Western Australian Prison Officers’ Union of Workers v Minister for Corrective Services [2024] WAIRC 01034
Pearce v Commissioner of Police, Western Australia Police [2019] WAIRC 00201
Rankin v State of Queensland (Queensland Health) [2021] QIRC 048
Re Harrison; Ex parte Hames [2015] WASC 247
Short v FW Hercus Pty Ltd [1993] FCA 51
The Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch v Public Transport Authority of Western Australia [2015] WAIRC 00324
The Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch v Public Transport Authority of Western Australia [2017] WAIRC 00830
Touhey v Salini Australia Pty Ltd [2022] FCA 55
United Workers Union v Child and Adolescent Health Service and others [2023] WAIRC 00666
Western Australian Prison Officers’ Union of Workers v Minister for Corrective Services [2024] WAIRC 00139
Western Australian Prison Officers’ Union of Workers v Minister for Corrective Services [2024] WAIRC 00227
WorkPac Pty Ltd v Bambach [2012] FWAFB 3206
WorkPac Pty Ltd v Skene [2018] FCAFC 131

Reasons for Decision
Background
1 On 18 September 2023, the applicant (Union) filed an application pursuant to s 46(1)(a) of the Industrial Relations Act 1979 (WA) (Act) for the Commission to declare the true interpretation of cl 45.1(a) of the Western Australian TAFE Lecturers’ General Agreement 2021 (Agreement).
2 The application was heard on 29 February 2024, at which time the matter was adjourned to:
(a) Await the Full Bench’s decision in FBA 9 of 2023 regarding the appeal of Minister for Corrective Services v Western Australian Prison Officers’ Union of Workers [2023] WAIRC 00909 (Minister for Corrective Services); and
(b) Allow the parties to discuss the terms of the declaration sought.
3 On 18 September 2024, the Full Bench delivered its decision in FBA 9 of 2023: Minister for Corrective Services v Western Australian Prison Officers’ Union of Workers [2024] WAIRC 00825.
4 On 24 September 2024, the parties:
(a) Confirmed that they did not seek to make any further submissions on the decision at [3] above.
(b) Submitted that the following revised declaration could be validly made if the Commission agreed with the Union’s case:
The Commission declares that on a proper interpretation of the Agreement:
1. for the purpose of calculating an employee’s annual leave entitlement, ‘year of service’ in clause 45.1(a) includes a period during which time an employee is absent from work and receiving compensation payments under the Workers’ Compensation and Injury Management Act 1981 (WA) (WCIM Act); and
2. clauses 51.4(b) and 51.8 do not apply to clause 45.1(a) or otherwise have the effect of limiting annual leave entitlements when an employee is absent from work and receiving compensation payments under the WCIM Act.
5 Clauses 45.1(a), 51.4(b) and 51.8 of the Agreement state:
45 ANNUAL LEAVE
45.1 Entitlement
(a) Each employee is entitled to four (4) weeks paid leave for each year of service. Annual leave will be calculated on a calendar year basis commencing on January 1 in each year.
51 PERSONAL LEAVE
51.4 Personal Leave Without Pay
(b) Personal leave without pay not exceeding a period of three (3) months in a continuous absence does not affect salary increment dates, anniversary date of sick leave credits, long service leave entitlements or annual leave entitlements. Where a period of personal leave without pay exceeds three (3) months in a continuous absence, the period in excess of three (3) months is excised from qualifying service.
51.8 Workers’ Compensation
Where an employee suffers a disability within the meaning of section 5 of the [WCIM Act] which necessitates that employee being absent from duty, personal leave with pay shall be granted to the extent of personal leave credits. In accordance with section 80(2) of the [WCIM Act] where the claim for workers’ compensation is decided in favour of the employee, personal leave credit is to be reinstated and the period of absence shall be granted as personal leave without pay.
6 The WCIM Act was repealed on 1 July 2024. For the purposes of this application, the relevant version of the WCIM Act is the one with a currency start date of 5 April 2023 and a currency end date of 23 October 2023.
Principles for construction of the Agreement
7 The Union relies upon the principles for interpretating industrial agreements set out in:
(a) WorkPac Pty Ltd v Skene [2018] FCAFC 131 (Skene) [197]:
The starting point for interpretation of an enterprise agreement is the ordinary meaning of the words, read as a whole and in context: City of Wanneroo v Holmes (1989) 30 IR 362 [(Holmes)] at 378 (French J). The interpretation ‘… turns on the language of the particular agreement, understood in the light of its industrial context and purpose …’: Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241 [(Amcor)] at [2] (Gleeson CJ and McHugh J). The words are not to be interpreted in a vacuum divorced from industrial realities (Holmes at 378); rather, industrial agreements are made for various industries in the light of the customs and working conditions of each, and they are frequently couched in terms intelligible to the parties but without the careful attention to form and draftsmanship that one expects to find in an Act of Parliament (Holmes at 378–9, citing Geo A Bond & Co Ltd (in liq) v McKenzie [1929] AR(NSW) 498 [(Geo)] at 503 (Street J)). To similar effect, it has been said that the framers of such documents were likely of a ‘practical bent of mind’ and may well have been more concerned with expressing an intention in a way likely to be understood in the relevant industry rather than with legal niceties and jargon, so that a purposive approach to interpretation is appropriate and a narrow or pedantic approach is misplaced: see Kucks v CSR Limited (1996) 66 IR 182 [(Kucks)] at 184 (Madgwick J); Shop Distributive and Allied Employees’ Association v Woolworths SA Pty Ltd [2011] FCAFC 67 [(Woolworths)] at [16] (Marshall, Tracey and Flick JJ); Amcor at [96] (Kirby J).
(b) Director General, Department of Education v United Voice WA [2013] WASCA 287 (Director General), per Buss J [81]–‍‍[83] (original emphasis):
81 The construction of an industrial agreement involves ascertaining what a reasonable person would have understood the parties to the agreement to mean. The language of the agreement should be understood in the light of its industrial context and purpose. See [Amcor] [2] (Gleeson CJ & McHugh J).
82 In [Kucks], Madgwick J observed:
It is trite that narrow or pedantic approaches to the interpretation of an award are misplaced. The search is for the meaning intended by the framer(s) of the document, bearing in mind that such framer(s) were likely of a practical bent of mind: they may well have been more concerned with expressing an intention in ways likely to have been understood in the context of the relevant industry and industrial relations environment than with legal niceties or jargon. Thus, for example, it is justifiable to read the award to give effect to its evident purposes, having regard to such context, despite mere inconsistencies or infelicities of expression which might tend to some other reading. And meanings which avoid inconvenience or injustice may reasonably be strained for. For reasons such as these, expressions which have been held in the case of other instruments to have been used to mean particular things may sensibly and properly be held to mean something else in the document at hand (184).
See also [Holmes], 378–379 (French J); Amcor [96] (Kirby J), [129]–‍[130] (Callinan J).
83 The words of a clause in a written agreement are to be given the most appropriate meaning which they can legitimately bear. A court must have regard to all of the provisions of the agreement with a view to achieving harmony among them. See Australian Broadcasting Commission v Australasian Performing Right Association Ltd [1973] HCA 36; (1973) 129 CLR 99 [(ABC)], 109–‍110 (Gibbs J). These propositions are applicable to instruments generally, subject to any particular rules of construction which have been developed in relation to a particular kind of provision or instrument.
(c) James Cook University v Ridd [2020] FCAFC 123 (Ridd) [65]:
The relevant principles applicable to the interpretation of an enterprise agreement may be stated as follows:
(i) The starting point is the ordinary meaning of the words, read as a whole and in context ([Holmes], 378; City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union [2006] FCA 813; 153 IR 426 [(Wanneroo)] [53]; [Skene] [197]).
(ii) A purposive approach is preferred to a narrow or pedantic approach – the framers of such documents were likely to be of a ‘practical bent of mind’ ([Kucks], 184; Woolworths [16]; [Skene] [197]). The interpretation ‘turns upon the language of the particular agreement, understood in the light of its industrial context and purpose’ ([Amcor] [2]).
(iii) Context is not confined to the words of the instrument surrounding the expression to be construed ([Wanneroo] [53]). It may extend to ‘… the entire document of which it is a part, or to other documents with which there is an association’ (Short v FW Hercus Pty Ltd [1993] FCA 51; 40 FCR 511 [(Hercus)], 518; Australian Municipal, Administrative, Clerical and Services Union v Treasurer of the Commonwealth of Australia [1998] FCA 249; 82 FCR 175, 178).
(iv) Context may include ‘… ideas that gave rise to an expression in a document from which it has been taken’ ([Hercus], 518).
(v) Recourse may be had to the history of a particular clause ‘Where the circumstances allow the court to conclude that a clause in an award is the product of a history, out of which it grew to be adopted in its present form…’ ([Hercus], 518).
(vi) A generous construction is preferred over a strictly literal approach ([Geo], 503–‍4; [Wanneroo] [57]), but ‘Awards, whether made by consent or otherwise, should make sense according to the basic conventions of the English language. They bind the parties on pain of pecuniary penalties’ ([Holmes], 380).
(vii) Words are not to be interpreted in a vacuum divorced from industrial realities but in the light of the customs and working conditions of the particular industry ([Holmes] 378–9; Skene [197]).
8 The respondents rely upon the principles for interpreting industrial agreements set out in:
(a) Fedec v The Minister for Corrective Services [2017] WAIRC 00828 (Fedec) [21]–‍‍‍[23]:
21 The approach that is to be applied when interpreting an industrial agreement is well established. This is:
(a) Industrial agreements are usually not drafted with careful attention to form by persons who are experienced in drafting documents that have legal effect.
(b) The task of construction of an industrial agreement is to be approached in a way that allows for a generous construction: [Holmes].
(c) Industrial agreements are made for industries in light of the customs and working conditions of each industry and must not be interpreted in a vacuum divorced from industrial realities: [Geo]; [Holmes] (378–379) (French J).
22 The general principles that apply to the construction of contracts and other instruments also apply to the construction of an industrial agreement. In Re Harrison; Ex parte Hames [2015] WASC 247 [(Re Harrison)], Beech J said [50]–[51]:
The general principles relevant to the proper construction of instruments are well-known. In summary:
(1) the primary duty of the court in construing an instrument is to endeavour to discover the intention of the parties as embodied in the words they have used in the instrument;
(2) it is the objectively ascertained intention of the parties, as it is expressed in the instrument, that matters; not the parties’ subjective intentions. The meaning of the terms of an instrument is to be determined by what a reasonable person would have understood the terms to mean;
(3) the objectively ascertained purpose and objective of the transaction that is the subject of a commercial instrument may be taken into account in construing that instrument. This may invite attention to the genesis of the transaction, its background and context;
(4) the apparent purpose or object of the relevant transaction can be inferred from the express and implied terms of the instrument, and from any admissible evidence of surrounding circumstances;
(5) an instrument should be construed so as to avoid it making commercial nonsense or giving rise to commercial inconvenience. However, it must be borne in mind that business common sense may be a topic on which minds may differ; and
(6) an instrument should be construed as a whole. A construction that makes the various parts of an instrument harmonious is preferable. If possible, each part of an instrument should be construed so as to have some operation (Electricity Generation Corporation v Woodside Energy Ltd [2014] HCA 7; (2014) 251 CLR 640 [35] (French CJ, Hayne, Crennan & Kiefel JJ); Kidd v The State of Western Australia [2014] WASC 99 [122]; Red Hill Iron Ltd v API Management Pty Ltd [2012] WASC 323 [106]–[112]; Primewest (Mandurah) Pty Ltd v Ryom Pty Ltd [2014] WASCA 28 [55] (Martin CJ, Pullin & Murphy JJA agreeing)).
These general principles apply in the construction of an industrial agreement ([Director General] [18]–[20] (Pullin J, Le Miere J agreeing), [83] (Buss J)). The industrial character and purpose of an industrial agreement is part of the context in which it is to be construed ([Amcor] [2] (Gleeson CJ and McHugh J); [Director General] [81]; see also [Amcor] (Kirby J), 129–130 (Callinan J)).
23 To these principles, the following observations made by Pullin J in [Director General] [18]–‍‍‍‍[19] should be added:
The Agreement has to be construed to determine what the intention of the parties was at the time the Agreement was entered into. This has to be determined by ascertaining what a reasonable person would have understood the words of the Agreement to mean taking into account the text, the surrounding circumstances known to the parties and the purpose and object of the transaction: Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; (2004) 219 CLR 165 [40]; Pacific Carriers Ltd v BNP Paribas [2004] HCA 35; (2004) 218 CLR 451 [22].
Surrounding circumstances may only be taken into account if the ordinary meaning of the words used by the parties is ambiguous or susceptible of more than one meaning: Codelfa Construction Pty Ltd v State Rail Authority of New South Wales [1982] HCA 24; (1982) 149 CLR 337 [(Codelfa)], 352; McCourt v Cranston [2012] WASCA 60 [(McCourt)] [23].
(b) Director General [19]–‍[20] (Pullin J, with whom Le Miere J agreed):
19 Surrounding circumstances may only be taken into account if the ordinary meaning of the words used by the parties is ambiguous or susceptible of more than one meaning: [Codelfa], 352; [McCourt] [23].
20 The phrase ‘district office’ is ambiguous if considered alone, but it would be wrong to concentrate only on that phrase. The phrase has to be construed in the context of the Agreement read as a whole: [ABC], 109. Even then, however, the phrase is ambiguous.
(c) Re Harrison [50(6)] and [51] (Beech J) (footnotes omitted):
50 The general principles relevant to the proper construction of instruments are well-known. In summary:
(6) an instrument should be construed as a whole. A construction that makes the various parts of an instrument harmonious is preferable. If possible, each part of an instrument should be construed so as to have some operation.
51 These general principles apply in the construction of an industrial agreement. The industrial character and purpose of an industrial agreement is part of the context in which it is to be construed.
The Union’s contentions
The Union’s principal contention
9 The Union submits that the term ‘year of service’ in cl 45.1(a) of the Agreement (at [5] above) should be interpreted to include periods when an employee is absent from work receiving workers’ compensation payments under the WCIM Act, for the following reasons:
(a) The Agreement does not define the terms ‘service’ or ‘continuous service’ in relation to cl 45 – Annual Leave. Therefore, these terms should be interpreted according to their ordinary meanings.
(b) The ordinary meaning of ‘service’ is a period during which an employee is employed by the employer: Browne v Director General, Department of Water and Environmental Regulation [2020] WASCA 16 (Browne) [119] (Le Miere J); Construction, Forestry, Maritime, Mining and Energy Union v Peabody CHPP Pty Ltd [2020] FWC 6287 (Peabody) [36], [46] (Riordan C):
[36] I have taken into account, the opposing submissions in relation to the plain and ordinary meaning of ‘service’. I note that the Concise Oxford Dictionary (tenth edition) defines ‘service’ to mean:
Service – a period of employment with a company or organisation.
[46] I do not accept that the definition of service in section 22 of the [Fair Work Act 2009 (Cth)] can be automatically transported into an enterprise agreement. The principles of interpretation determined in Ridd require words to be given their plain and ordinary meaning. I endorse the definition from the Oxford Dictionary in providing the plain and ordinary meaning of this term, that is, service is the period of time where an employee is employed by an organisation.
(c) The ordinary meaning of ‘continuous service’ is a period of unbroken service with an employer: Browne [119] (Le Miere J):
119 The meaning of ‘continuous service’ in the General Order must be determined by considering the terms of the General Order as a whole. The General Order makes provision for long service leave for government wage employees employed by a Public Authority. Clause 1 provides that employees employed by a Public Authority shall become entitled to specified long service leave after a specified period of ‘continuous service’. The natural and ordinary meaning of service is a period during which an employee is employed by an employer. The natural and ordinary meaning of ‘continuous service’ is a period of unbroken service with an employer by an employee. The General Order enlarges the natural and ordinary meaning of both ‘service’ and ‘continuous’.
(d) While the term ‘service’ can be attributed an ordinary meaning that is confined to the performance of work pursuant to the following definition in the Macquarie Dictionary, attributing this narrower literal meaning to cl 45.1(a) would impermissibly require discarding the more generous, and equally valid and available literal meaning that service is a period during which an employee is employed by an employer:
6. the performance of duties as a servant; occupation or employment as a servant.
7. employment in any duties or work for another, a government, etc.
(e) Sections 18, 7(5) and 11(2) of Schedule 1, and 84AA(1) of the WCIM Act operate to require an employer to maintain an employee’s employment while they are in receipt of workers’ compensation:
18. Employers liable to pay compensation for injuries to workers
(1) If an injury of a worker occurs, the employer shall, subject to this Act, be liable to pay compensation in accordance with Schedule 1.
Schedule 1 — Compensation entitlements
7. Total or partial incapacity
(5) Unless otherwise authorised by WorkCover WA, compensation shall be paid by the employer to the worker at the employer’s usual place of payment of wages on the employer’s usual pay days or, at the request of the worker shall be sent by prepaid post to the worker’s address.
11. Terms used
(2) In this Schedule –
Amount A means the rate of weekly earnings payable, at the time of the incapacity, for the appropriate classification under the relevant industrial award …
84AA. Employer to keep position available during worker’s incapacity
(1) Where a worker who has been incapacitated by injury attains partial or total capacity for work in the 12 months from the day the worker becomes entitled to receive weekly payments of compensation from the employer, the employer shall provide to the worker –
(a) the position the worker held immediately before that day if it is reasonably practicable to provide that position to the worker; or
(b) if the position is not available, or if the worker does not have the capacity to work in that position, a position –
(i) for which the worker is qualified; and
(ii) that the worker is capable of performing,
most comparable in status and pay to the position mentioned in paragraph (a).
Penalty: $5 000.
(f) Under the WCIM Act, an employer is required to maintain an employee’s employment while they are receiving workers’ compensation. As a result, the employee continues to be considered as completing their ‘service’ for the purposes of cl 45.1(a) (at [5] above), notwithstanding that they are excused from performing work. This means that cl 45.1(a) entitles the employee to accrue annual leave during their absence from work whilst on workers’ compensation.
(g) As it is an agreed fact that the Agreement is an ‘industrial agreement’ for the purposes of the WCIM Act, this outcome is permitted by s 80(1) of the WCIM Act (emphasis added):
80. Effect of leave entitlements; effect on sick leave
(1) Compensation is payable in accordance with this Act to a worker in respect of any period of incapacity notwithstanding that the worker has received or is entitled to receive in respect of such period any payment, allowance, or benefit for annual leave or long service leave under any Act of the Commonwealth or of the State, any industrial award under any such Act, or any other industrial agreement applicable to his employment, and the amount of compensation so payable shall be the amount which would have been payable to the worker had he not received or been entitled to receive in respect of such period any such payment, allowance, or benefit.
(h) There is nothing in the text of cl 45 – Annual Leave that limits the accrual of annual leave during an employee’s absence from work on workers’ compensation.
(i) The Union’s interpretation is supported by cls 51.3(a) and 51.9 of the Agreement, which state that personal leave entitlements are based on ‘continuous service’ and recognise that the term ‘service’ extends to paid and unpaid absences, which would include a period of workers’ compensation:
51. PERSONAL LEAVE
51.3 Entitlement
(a) The employer shall credit each permanent employee with the following personal leave credits:

Personal Leave Cumulative
Personal Leave NonCumulative
On the day of initial appointment
48.75 hours
15 hours
On the completion of 6 months continuous service
48.75 hours
0 hours
On the completion of 12 months continuous service
97.5 hours
15 hours
On the completion of each further period of 12 months continuous service
97.5 hours
15 hours
51.9 Continuous Service
(a) For the purposes of this clause ‘service’ shall not include:
(i) any period exceeding 14 calendar days during which an employee is absent on leave without pay. In the case of leave without pay which exceeds 14 calendar days, the entire period of such leave without pay is excised in full;
(ii) any period which exceeds six (6) months in one continuous period during which an employee is absent on workers’ compensation. Provided that only that portion of such continuous absence which exceeds six months shall not count as ‘service’;
(iii) any period which exceeds three (3) months in one continuous period during which an employee is absent on personal leave without pay. Provided that only that portion of such continuous absence which exceeds three (3) months shall not count as ‘service’.
10 The Union contends that cls 51.4(b) and 51.8 (at [5] above), do not apply to cl 45.1(a) (at [5] above) or otherwise have the effect of limiting annual leave entitlements when an employee is absent from work on workers’ compensation, because:
(a) Clause 51.8 reproduces the substance of s 80(2) of the WCIM Act, which prohibits the payment of sick leave entitlements during a compensation period, and preserves sick leave entitlements by reinstating any sick leave that was initially accessed:
80. Effect of leave entitlements; effect on sick leave
(2) A worker is not entitled to receive from any employer payments for sick leave entitlements for any period for which he receives weekly payments of compensation for injury under this Act, and where the first-mentioned payments are made and the second-mentioned payments are subsequently made in respect of the same period, the worker shall reimburse to the employer the first-mentioned payments and the employer shall reinstate the worker’s sick leave entitlements as a credit to the extent that the worker does so reimburse the employer.
(b) The final words in cl 51.8 that ‘personal leave credit is to be reinstated and the period of absence shall be granted as personal leave without pay’ does not engage cl 51.4 for the following reasons.
(c) Clause 51.4 deals with ‘Personal Leave Without Pay’. The purpose of cl 51.4 is set out in cl 51.4(a) and is to provide for an authorised absence where an employee has ‘exhausted all of their personal leave entitlements and are ill or injured’:
51 PERSONAL LEAVE
51.4 Personal Leave Without Pay
(a) 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 produce medical evidence to the satisfaction of the Managing Director.
(d) Clause 51.4(b) (at [5] above) excludes periods of ‘personal leave without pay’ of more than three months from ‘qualifying service’ for the purpose of sick leave, long service leave and annual leave entitlements. Clause 51.4(b) is not directed towards a period of workers’ compensation.
(e) Presumably, cl 51.4 was intended to reproduce ‘Sick Leave Without Pay – Normal Illness’ of Administrative Instruction 610 (AI 610), which is not directed towards a period of workers’ compensation.
(f) Clause 51.8 (at [5] above) engaging with cl 51.4 would produce textual and contextual conflicts between:
(i) Clauses 51.4(b) and 51.9(a)(ii) (emphasis added):
51 PERSONAL LEAVE
51.4 Personal Leave Without Pay
(b) Personal leave without pay not exceeding a period of three (3) months in a continuous absence does not affect salary increment dates, anniversary date of sick leave credits, long service leave entitlements or annual leave entitlements. Where a period of personal leave without pay exceeds three (3) months in a continuous absence, the period in excess of three (3) months is excised from qualifying service.
51.9 Continuous Service
(a) For the purposes of this clause ‘service’ shall not include:
(ii) any period which exceeds six (6) months in one continuous period during which an employee is absent on workers’ compensation. Provided that only that portion of such continuous absence which exceeds six months shall not count as ‘service’.
(ii) Clauses 51.4(b) (at [5] and [10(f)(i)] above) and AI 610 (emphasis added):
Sick Leave Without Pay
Normal Illness
Sick leave without pay not exceeding a period of three months in a continuous absence does not affect salary increment dates, anniversary date of sick leave credits, long service leave entitlements or annual leave entitlements. Where a period of sick leave without pay exceeds three months in a continuous absence, the period in excess of three months is excised from qualifying service.
Workers’ Compensation
Since January 1, 1953, a period of sick leave without pay granted to an officer on account of an illness compensable under the provisions of the [WCIM Act], does not affect salary increment dates, the anniversary date of sick leave credits, long service leave entitlements or annual leave entitlements provided the period of leave granted does not exceed six months in a continuous absence. Where the period of sick leave granted does not exceed six months in a continuous absence, only the period in excess of six months is excised from qualifying service.
NOTE: Salary increments payable according to age are not affected by grants of sick leave without pay.
(g) It is unlikely, objectively, that the parties would have negotiated terms in the Agreement that are less favourable to the employee than AI 610.
(h) Instead, the purpose of the final words in cl 51.8 (at [5] above) is limited to engaging the six month cap in cl 51.9(a)(ii) (at [9(i)] and [10(f)(i)] above) solely for the purpose of determining personal leave credits in accordance with clause 51.3(a) (at [9(i)] above) during a period of workers’ compensation exceeding six months.
(i) This outcome is consistent with AI 610 ‘Sick Leave Without Pay – Workers’ Compensation’ concerning ‘sick leave credits’.
(j) This outcome is also consistent with AI 610 ‘Sick Leave Without Pay – Workers’ Compensation’ concerning ‘long service leave entitlements or annual leave entitlements’, which caps service during workers’ compensation to six months, while cls 55 – Long Service Leave and 45 – Annual Leave does not cap service during workers’ compensation. It is a far more cogent, industrially sensible and likely outcome that the parties would agree to more generous arrangements for long service leave and annual leave entitlements during workers’ compensation in the Agreement than AI 610, by not including in the Agreement a cap on these entitlements while an employee is absent on workers’ compensation.
The Union’s alternative contention
11 In the alternative, the Union contends that ss 5(1) and 5(2) of the Minimum Conditions of Employment Act 1993 (WA) (MCE Act) operate such that the entitlement to paid annual leave in s 23 of the MCE Act are implied in the Agreement:
5. Minimum conditions implied in awards etc.
(1) The minimum conditions of employment extend to and bind all employees and employers and are taken to be implied –
(a) in an industrial instrument; or
(b) if a contract of employment is not governed by an industrial instrument – in that contract.
(2) A provision in, or condition of, an employer-employee agreement, an award or a contract of employment that is less favourable to the employee than a minimum condition of employment has no effect.
23. Paid annual leave, entitlement to
(1) An employee, other than a casual employee, is entitled for each year of service, to paid annual leave for the number of hours the employee is required ordinarily to work in a 4 week period during that year, up to 152 hours.
(2) An entitlement under subsection (1) accrues pro rata on a weekly basis.
(2a) Entitlements under subsection (1) are cumulative.
(3) In subsection (1), year does not include any period of unpaid leave.
(4) Subsection (1) does not apply to an employee of a class prescribed by the regulations.
12 The Union contends that ‘year of service’ in s 23(1) of the MCE Act (at [11] above), should be interpreted consistently with the ordinary meaning of ‘service’ as a year of employment, in accordance with Browne [119] (Le Miere J) and Peabody (at [9(b)–‍(c)] above). The only proviso being that ‘unpaid leave’ is not to be counted pursuant to s 23(3) of the MCE Act.
13 The Union contends that the narrow interpretation of ‘year of service’ as a year of performance of work can be ruled out, because:
(a) If that was the intention, there would have been no need to exclude ‘unpaid leave’ in s 23(3) from s 23(1), as an employee is not performing work when they are on unpaid leave.
(b) That would require excluding recognised situations where an employee may be excused from performing work but is still giving service, such as:
(i) Sick leave: Graham v Baker [1961] HCA 48 (Graham) [8] (footnotes omitted):
… we are concerned with a contract pursuant to which, generally speaking, the employee was bound to work for his wages. But the contract contemplates the possibility that circumstances of a defined character may arise and prevent the employee from performing his duties. In those circumstances he is to be entitled to absent himself on sick leave and, subject to specified limits, to receive ‘full pay’ whilst on leave. In our view the respondent’s contract says no more and no less than that, if he becomes unable by reason of sickness or other specified causes to perform his ordinary duties, nevertheless his right to ‘full pay’ or, in other words, his ordinary wages, shall continue to be payable, subject to the limits specified, during the period of his absence. If, therefore, the claim be made, as it was, that the respondent lost the whole of his wages between the date of the accident and the date of trial then the appellant was entitled to answer it by showing that for a period of 178 days he received his full wages.
(ii) Annual leave: The Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch v Public Transport Authoriy of Western Australia [2015] WAIRC 00324 (PTA) [14]:
As a matter of long standing industrial principle, a period of annual leave is to be generally regarded as time worked and service performed by an employee. An employee whilst on annual leave is entitled to receive, subject to the terms of any industrial instrument applicable to their employment, the payments they would otherwise have received for ordinary working hours, had they not been on leave: The Annual Leave Cases 1971 (1972) 144 CAR 528; Re The Vehicle Industry – Repair, Services and Retail – Award 1976 (1979) 38 FLR 267; Re Engine Drivers’ Award – State (1980) AILR 314. This may extend to over award payments, shift loadings and various allowances payable for working ordinary hours. Thus the annual leave benefit, whether conferred by industrial instrument or statutory provision, relieves an employee from the obligation to attend at work, whilst receiving remuneration for an ordinary week’s work (see too s 18(1) MCE Act).
14 Instead, ‘year of service’ extends to situations where an employee is being paid but not working, which would include a period an employee is absent and receiving paid workers’ compensation.
15 The Union relies on the following Federal and Queensland decisions in support of its contention that an absence on workers’ compensation under the WCIM Act is ‘paid’, and therefore not ‘unpaid leave’ under s 23(3) and excluded from the entitlement under s 23(1) of the MCE Act:
(a) WorkPac Pty Ltd v Bambach [2012] FWAFB 3206 (Bambach) [32] (original emphasis):
The word ‘unpaid’ presents an insurmountable problem for the appellant in this case. The period during which Mr [Bambach] was absent due to his work related injury was not ‘unpaid’. During the relevant period Mr Bambach received compensation payments in accordance with the provisions of the Workers’ Compensation Act 1987 (NSW) (the Workers’ Compensation Act). Those payments were made pursuant to a legal obligation upon Mr Bambach’s employer, WorkPac. Section 9(1) of the Workers’ Compensation Act provides:
A worker who has received an injury ... shall receive compensation from the worker’s employer in accordance with this Act.
(b) Hall v Medical Imaging Queensland Pty Ltd [2015] FCCA 326 (Hall) [25]–[26]:
25. What then differentiates between an employee who is absent and paid compensation by reason of a statute like the Workers’ Compensation Act (Qld) and a worker who receives payment because of a private insurance arrangement or a statutory ‘no fault’ compensation scheme? The answer is supplied by Bambach. That decision demonstrates that, if the employer has an obligation to pay the employee whilst he is absent, then whether the employer pays the employee, or another does on the employer’s behalf does not matter. The [absence] is not unpaid for the purposes of s 22(2)(b) of the Fair Work Act.
26. Bambach does not bind me but it is I think, with respect, correct. What is important is the existence of an obligation on the employer to pay the employee whilst he or she is absent.
(c) Rankin v State of Queensland (Queensland Health) [2021] QIRC 048 (Rankin) [61]–‍‍[63]:
[61] It is clear from the legal framework established in Bambach, Hall and recently in this jurisdiction by [Leonard v State of Queensland (Queensland Health) [2020] QIRC 207], that Workers’ Compensation payments constitute ‘pay’.
[62] It follows that while the Applicant was not receiving salary or wages during the time she was receiving workers’ compensation payments, she was receiving ‘pay’ in the form of compensation.
[63] This means that the Applicant was not ‘absent without pay’ for the purposes of s 32 of the [Industrial Relations Act 2016 (Qld)] and therefore meets the ‘completed year of employment’ required to be entitled to annual leave under s 31 of the [Industrial Relations Act 2016 (Qld)].
(d) Touhey v Salini Australia Pty Ltd [2022] FCA 55 (Touhey) [44]:
The effect of s 87 is that an employee is entitled to accrue four weeks’ paid annual leave for each year of ‘service’ with an employer. The term ‘service’ is relevantly defined in s 22 of the FW Act as a period of service by an employee during which time the employee is employed by the employer, but does not include any ‘excluded period’. Excluded periods are set out in s 22(2) and include any period of unauthorised absence, any period of unpaid leave or unpaid unauthorised absence (other than a period of community service leave under Division 8 or Part 2-2 or a period of stand down), or any other period of a kind prescribed by the regulations. None of the excluded periods are applicable in this matter. Importantly, time spent absent from work but whilst receiving workers’ compensation payments are not excluded by s 22(2).
16 The Union contends that it would undermine the beneficial and remedial purpose of s 23(1) of the MCE Act (at [11] above), for paid sick leave, one form of statutory income protection, to be included in ‘year of service’, but for workers’ compensation, another form of statutory income protection, to be excluded. Especially where sick leave applies to non-work related injuries and absences, and workers’ compensation applies to work-related injuries and absences.
17 The Union contends that its interpretation of ‘year of service’ is supported by the definition of authorised leave in s 9A(4)(c) of the MCE Act capturing the WCIM Act in the words ‘by or under a law … of the State’, thereby capturing workers’ compensation absences in an employee’s maximum weekly ordinary hours of work in ss 9A(1) and 9A(2) (emphasis added):
9A. Maximum hours of work
(1) An employee is not to be required or requested by an employer to work more than –
(a) either –
(i) the employee’s ordinary hours of work as specified in an industrial instrument that applies to the employment of the employee; or
(ii) if there is no industrial instrument that specifies the employee’s ordinary hours of work, 38 hours per week;
and
(b) reasonable additional hours as determined under section 9B.
(2) For the purpose of subsection (1), in calculating the number of hours that an employee has worked in a particular week, the hours worked by the employee are taken to include any hours of authorised leave taken by the employee during the week.
(3) Nothing in this section, or section 5(2), restricts the number of ordinary hours of work that may be specified in an industrial instrument.
(4) In this section –
authorised leave means leave, or an absence, whether paid or unpaid, that is authorised –
(a) by an employee’s employer; or
(b) by or under a term or condition of an employee’s employment; or
(c) by or under a law, or an instrument in force under a law, of the State or the Commonwealth.
18 Therefore, the Union contends that Cicchini IM wrongly decided in Jones v Barminco Pty Ltd (2001) WAIG 1183 (Jones), 1188–1189 that ‘year of service’ in s 23(1) of the MCE Act (at [11] above) does not extend to workers’ compensation:
I now turn to consider whether the complainant accrued leave whilst on workers’ compensation. In this regard the complainant argues that clause 21(10) of the award is inconsistent with section 23(1) of the MCE Act and that to the extent that it is it has no effect. Section 5(2) of the MCE Act provides –
(2) A provision in, or condition of, a workplace agreement, an award or a contract of employment that is less favourable to the employee than a minimum condition of employment has no effect.
The complainant argues that he is entitled to payment of annual leave for the period of annual leave accrued whilst on workers’ compensation. The defendant for its part denies that the complainant is entitled to accrue annual leave whilst on workers’ compensation. It says that there is no inconsistency between the MCE Act and the award. It says that an employee is only entitled to annual leave for ‘each year of service’ accrued pro rata on a weekly basis. It contends that whilst on workers’ compensation the employee cannot be said to be in the service of the employer.
The complainant argues for the reasons previously stated that ‘each year of service’ is to be read ‘each year of employment’. I respectfully disagree. The word ‘service’ has been specifically used by the legislature. It is not appropriate to substitute it with another word. ‘Service’ is capable of definition and has its own particular meaning. The CCH Macquarie Dictionary of Employment and Industrial Relations defines ‘service’ to mean –
the performance of duties as a servant; employment in duties or work for another.
It is apparent from the definition referred to above that the word ‘service’ connotes more than the contractual relationship between the employer and employee. Indeed it expressly addresses the performance of duties and the carrying out of work. It is axiomatic that duties are not performed and an employee does not carry out work whilst on workers’ compensation. Annual leave can only accrue whilst the employee is engaged in the regular performance of duties as a servant and during any consensual rest period that relates thereto. If an employee is precluded from carrying out such duties on account of injury, then during such period of incapacity the employee cannot be said to be providing a service to his or her employer notwithstanding that the employee remains within the employment relationship.
The complainant’s argument with respect to entitlement to annual leave whilst on workers’ compensation is contingent on my acceptance of the argument that the word ‘service’ in section 23(1) of the MCE Act should be read as ‘employment’. I do not accept that argument. The words are distinct and have distinct meanings. I do not accept the complainant’s argument that annual leave accrued to him whilst he was receiving weekly workers’ compensation payments. Accordingly I hold that the MCE Act and the award are not inconsistent with each other. The claim for unpaid annual leave cannot succeed.
The respondents’ contentions
19 The respondents note that cl 45.1(a) (at [5] above) provides that each employee covered by the Agreement is entitled to four weeks paid leave ‘for each year of service’. However, ‘service’ and ‘year of service’ are not defined for the purposes of cl 45.1(a). Further, the term ‘continuous service’ is only defined for the purposes of cl 51 – Personal Leave.
20 The respondents contend that while there is no definition of ‘service’ or ‘year of service’, cls 51.4(b), 54.1, 54.3 and 54.4 expressly carve out periods from being periods of ‘service’ (emphasis added):
51.4 Personal Leave Without Pay
(b) Personal leave without pay not exceeding a period of three (3) months in a continuous absence does not affect salary increment dates, anniversary date of sick leave credits, long service leave entitlements or annual leave entitlements. Where a period of personal leave without pay exceeds three (3) months in a continuous absence, the period in excess of three (3) months is excised from qualifying service.
54 LEAVE WITHOUT PAY
54.1. Entitlement
(d) Any continuous period of leave without pay exceeding 10 working days granted under this clause:
(i) does not count as service, and
(ii) does not constitute a break in continuous service.
54.3 Leave Without Pay for Full Time Study
(c) Leave without pay for this purpose will not count as qualifying service for leave purposes.
54.4 Leave Without Pay for Australian Institute of Sport Scholarships
(b) Leave without pay for this purpose will count as qualifying service for all purposes except annual leave and professional leave.
21 The respondents argue that it is not necessary to determine what ‘service’ or ‘year of service’ in cl 45.1(a) means, because cl 51.4(b) (at [5] above) makes it clear that periods of personal leave without pay exceeding three months are excluded from qualifying service for the purposes of accruing annual leave.
22 The respondents argue that it is apparent from cl 51.8 (at [5] above), that the parties to the Agreement objectively intended for periods of leave on workers’ compensation to be deemed personal leave without pay for the purposes of the Agreement, and therefore for the purposes of accruing annual leave under the Agreement. In that regard, cl 51.8 is mandatory, requiring the employer to grant personal leave without pay in such circumstances.
23 It follows from the combined effect of cls 51.4(b) and 51.8 that where an employee is absent on workers’ compensation for more than three months, the period in excess of three months is excised from qualifying service for the purposes of accruing annual leave (and personal leave and long service leave).
24 The respondents disagree that there is any inconsistency between cls 51.4(b) and 51.9(a)(ii) (at [10(f)(i)] above). Clause 51.4(b) deals with sick leave (and annual leave and long service leave) and cl 51.9(a)(ii) deals with the meaning of ‘continuous service’ for the purposes of cl 51, which deals with personal leave. They are not the same.
25 Clause 51 of the Agreement replaces cl 27 – Sick Leave of the Award, with the exception of cl 27(23) – war caused illnesses of the Award. Accordingly, sick leave is still accrued under cl 27(23) of the Award, and cl 51.4(b) (at [5] above) impacts upon the accrual of that sick leave, but it does not impact upon the accrual of personal leave.
26 While, as a matter of policy, employees are afforded more beneficial arrangements under AI 610, AI 610 has no bearing on the proper construction of the Agreement. Furthermore, the Union’s submission that it is unlikely the parties negotiated terms less generous than AI 610 should be rejected for the following reasons:
(a) Firstly, AI 610 can be repealed at any time, rendering its terms irrelevant. In such a scenario, the less generous terms of the Agreement would apply.
(b) While the Union may not agree to less generous terms, it is obvious why the respondents would. Nevertheless, enquiring into the subjective intentions of the parties is not the proper approach to the construction of the Agreement.
(c) Secondly, AI 610 arguably has no application, because Administrative Instructions were made under s 19 of the now repealed Public Service Act 1978 (WA) (PS Act), under which, the Public Service Board (PSB) could ‘discharge its functions and exercise its powers by Administrative Instructions’. The PSB’s functions were to ‘promote and maintain effective, efficient, and economic management of the Public Service of the State’. The Public Service was constituted by Departments and SubDepartments established under s 21 of the PS Act, which did not include the respondents’ predecessors, some of which were established under the now repealed Colleges Act 1978 (WA) and not the PS Act.
(d) Even if AI 610 were to apply to the respondents, it deals with sick leave and not personal leave, and cl 51 of the Agreement replaces the cl 27 – Sick Leave entitlement in the Award, rendering AI 610’s provisions inapplicable.
(e) Thirdly, extrinsic material should only be considered for constructional purposes if ambiguity is first identified in the Agreement.
27 The respondents submit that the Full Bench decision of The Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch v Public Transport Authority of Western Australia [2017] WAIRC 00830 (ARTBIU) is binding on the Commission, and requires the establishment of ambiguity before an enquiry into the history, custom and practice or any extrinsic material is permissible [100]:
From the authorities referred to above and the express provisions of s 46 and s 83 of the Act, the following principles emerge in respect of an award as defined in s 46(5):
(a) The power to interpret the true meaning of an award, pursuant to the power conferred by s 46, is to enable a determination of whether ambiguity arises and to resolve it, if it does.
(b) If a provision in question is capable in the ordinary sense of not having an ambiguous meaning, then consideration of the expressed or supposed intention of the provision does not fall to be considered under s 46.
(c) If a provision is found to be ambiguous, the Commission acting pursuant to s 46 can embark upon a factfinding exercise to determine the surrounding circumstances that existed when the award or industrial agreement was made. These surrounding circumstances can include ascertaining the object of the provision by:
(i) inquiring into the history of the award;
(ii) any established custom, practice or usage which led to the making of the award and any relevant established custom, usage and practice since the award was made.
(d) If ambiguity is found and after ascertaining the true meaning of the award and declaring its effect it is found the words in the provision in question are defective, in that the words do not put into effect or reflect that meaning or it is found that the words used require amendment to give fuller effect to the true meaning, the Commission is authorised to exercise arbitral power to amend the provision.
(e) The power to interpret an award or industrial agreement pursuant to s 46 of the Act is, except for the power to amend a provision in s 46(1)(b), merely declaratory and any declaration made cannot be made as an order to enforce a right.
(f) The determination of whether a particular employee has an entitlement pursuant to the provisions of an award is an enforcement matter in relation to which the Industrial Magistrate has exclusive jurisdiction to determine, pursuant to the power conferred by s 83 of the Act.
28 The Commission is also bound by the decision of Director General ‍[19], which cites the High Court decision of Codelfa, that surrounding circumstances can only be taken into account if the ordinary meaning of the words is ambiguous or susceptible to more than one meaning: [8(b)] above, also cited in Fedec [23] at [8(a)] above.
29 The respondents submit that it would be unsafe for the Commission to construe the Agreement in accordance with the principles outlined in the federal authorities relied upon by the Union, as the decisions binding on the Commission have consistently followed the strict approach to contract interpretation, requiring ambiguity before considering surrounding circumstances or extrinsic material.
30 The Union’s reliance on United Workers Union v Child and Adolescent Health Service [2023] WAIRC 00666 (UWU) [47] as the basis for not needing to establish an ambiguity to have regard to AI 610, is misplaced. This is because the historical context referred to in UWU, is the historical context of the same agreement, in circumstances where each agreement referenced the prior agreement it was cancelling: UWU [45]. This is the context in which the Senior Commissioner in UWU had regard to the earlier versions of the agreement without finding there to be ambiguity. This is the exception to the rule requiring ambiguity before having regard to extrinsic circumstances – where the agreement itself references the other document: Black Box Control Pty Ltd v Terravision Pty Ltd [2016] WASCA 219 (Black Box) [42(6)] (footnotes omitted):
The principles relevant to the proper construction of instruments are well known, and were not in dispute in this case. In summary:
…
(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.
31 The Union’s submission that ‘service’ is synonymous with being employed, should be rejected for the following reasons:
(a) The accuracy of Cicchini IM’s analysis in Jones concerning the distinction between service and continuous employment, was accepted in UWU [36].
(b) As Jones has recently been referred to with approval in UWU by the Commission, Jones should be followed unless it is determined to be ‘plainly wrong’.
(c) The Agreement distinguishes between ‘service’ and ‘employment’ and that distinction needs to be given work to do. For example, while annual leave (and some other forms of leave) accrue by reference to ‘service’, an employee is eligible for higher duties by reference to being ‘continuously employed’, and cultural leave and family and domestic violence leave is afforded by reference to a ‘calendar year’ or a ‘year’, without any reference to service (emphasis added):
32 HIGHER DUTIES
32.1 An employee continuously employed for more than five (5) consecutive days in a position, for which the salary is higher than that prescribed for the employee’s permanent position, will be paid the salary, to which he, or she, would be entitled, if the employee held that position permanently for the full period of time so worked.
50 CULTURAL LEAVE FOR ABORIGINAL AND TORRES STRAIT ISLANDERS
50.2 Up to five days of paid cultural leave per calendar year will be available under this clause. The leave need not be taken in one continuous period. Paid cultural leave will not accrue from year to year and will not be paid out on termination.
52 FAMILY AND DOMESTIC VIOLENCE LEAVE
52.7 Subject to clause 52.5 and 52.6, an employee experiencing family and domestic violence will have access to ten (10) non-cumulative days per year of paid family and domestic violence leave, in addition to their existing leave entitlements.
32 Furthermore, cls 45.2(c) and 45.5(b) of the Agreement, referring to ‘ceasing duty’ and ‘returns to that region to complete the necessary service’, suggest that ‘service’ in the Agreement is centred on the performance of work or duty, rather than simply referring to the fact of employment:
45.2 Pro rata Annua Leave
(c) An employee who has been permitted to proceed on annual leave and who ceases duty before completing the required continuous service to accrue the leave, must refund the value of the unearned pro rata portion, calculated at the rate of salary as at the date the leave was taken, but no refund is required in the event of the death of an employee.
45.5 Additional leave for the North West
(b) An employee who proceeds on annual leave before having completed the necessary year of continuous service may be given approval for the additional five (5) working days leave provided the leave is taken at college convenience and provided the employee returns to that region to complete the necessary service.
33 The respondents submit that regardless of the meaning of ‘service’, it does not apply to an employee absent on workers’ compensation, due to cl 51.4(b) (at [5] above).
34 The respondents submit that there is no ambiguity in cl 45.1(a) (at [5] above). The ordinary meaning of ‘continuous service’ requires ‘performing duties for an employer’: UWU [34]:
The term ‘continuous service’ has a commonly understood, plain, industrial meaning derived from the combination of the ordinary common sense meaning of the two words that it comprises: ‘continuous’ meaning a connected and unbroken period and ‘service’ meaning experience performing duties for an employer: see [Browne] [119], Holland v UGL Resources Pty Ltd T/A UGL Resources [2012] FWA 3453 at [20]–[22] and McCallum, R. C, Butterworths Employment and Law Dictionary, (1997).
35 The Senior Commissioner in UWU [34] references Browne [119] in support of the view that ‘service’ requires the performance of duties. However, the Union relies on Browne [119] (at [9(c)] above) to argue that ‘service’ has a meaning synonymous with employment, which is a more expansive definition than the performance of duties. This discrepancy necessitates a closer examination of Browne.
36 Browne involved the construction of a General Order. Clauses 2(a) and 2(b) of the General Order state:
2(a) For the purpose of these conditions ‘service’ means service as an employee of a Public Authority and shall be deemed to include:-
(i) absence of the employee on annual leave or public holidays;
(ii) absence of the employee on paid sick leave or on an approved rostered day off;
(iii) absence of the employee on approved sick leave without pay except that portion of a continuous absence which exceeds three months. Provided that prior to 1 July 1957 only two weeks in any year shall be allowed and provided that prior to 1 April 1974 and after 1 July 1957 only six weeks in any year shall be allowed;
(iv) absence of the employee on approved leave without pay, other than sick leave without pay but not exceeding two weeks in any qualifying period;
(v) absence of the employee on National Service or other military training, but only if the difference between the employees’ military pay and his civilian pay is made up, or would, but for the fact that his military pay exceeds his civilian pay, be made up by his employer;
(vi) absence of the employee on workers’ compensation for any period not exceeding six months, or for such greater period as the Minister for Industrial Relations may allow;
(vii) absence of the employee on long service leave which accrues on or after 1 April 1974;
(viii) absence of an employee on approved leave to attend Trade Union training courses or on approved leave to attend Trade Union business; and
(ix) employment in the service of the Commonwealth or another State of Australia as provided in Clause 16 hereof, when employment in the State Government commences on or after 1 April 1974.
2(b) The Service of an employee shall be deemed NOT to include:-
(i) service of an employee after the day on which he has become entitled to 26 weeks’ long service leave until the day on which he commences the taking of 13 weeks of that leave;
(ii) any period of service with an employer of less than 12 months. Provided where after 1 April 1974 an employee has service of a month or more but less than 12 months immediately prior to being transferred by one State Government employer to another; becoming redundant or qualifying for pro rata payment in lieu of leave pursuant to Clause 11, then such period of service shall count;
(iii) any period during which an employee has been paid as a casual;
(iv) any other absence of the employee except such absences as are included in service by virtue of subclause (a) hereof; and
(v) any service of an employee prior to 1 April 1974 where that employee was less than 18 years of age.
37 Browne [119] must be understood in the context of the deeming provisions (at [36] above), which broaden the natural and ordinary meaning of ‘service’. Furthermore, the absences outlined in cl 2(a) of the General Order similarly broaden the natural and ordinary meaning of ‘service’. It follows that those absences, which include paid leave, do not fall within the natural and ordinary meaning of ‘service’.
38 The respondents submit that the different characterisation of Browne [119] possibly arises from the ambiguity in the words ‘employed by an employer’ in the sentence: ‘The natural and ordinary meaning of service is a period during which an employee is employed by an employer.’
39 The respondents submit that ‘employed’ can mean the performance of work, or the mere existence of an employment relationship. In Brett v Sharyn O’Neill, Director General, Department of Education [2015] WASCA 66 [40], it was found that ‘employed’ in the Working With Children (Criminal Record Checking) Act 2004 (WA), meant the performance of work (emphasis added):
The WWC Act s 23 provides that if a person holds a current interim negative notice the person must not be ‘employed’ in childrelated employment. The purpose of s 23 is to prevent a person who holds a current interim negative notice from carrying out child-related work by prohibiting people who have been charged with or convicted of relevant offences from carrying out childrelated work whilst in an employmentlike relationship. The WWC Act is concerned with a person holding a current interim negative notice carrying out childrelated work, not regulating the contract of employment between an employer and an employee or requiring contracts of employment to be terminated. If an employer suspends an employee from carrying out childrelated work, or all work, or orders the employee to stay away from the premises on which childrelated work is carried out then the employer would not be contravening WWC Act s 22(3) notwithstanding that the contract of employment continued to subsist. The terms ‘employ’ in s 22(3) and ‘employed’ in s 23(a) relate to the work performed or to be performed by the person in question, as distinct from the contractual or other relationship between the person and the employer.
40 The respondents submit that Browne should be read as a whole, and that Le Miere J in Browne [119] intended to use the term ‘employed’ in the sense of performing work, rather than simply referring to employment in general. Otherwise, Browne [120] would make no sense:
120 Clause 2 of the General Order enlarges the natural and ordinary meaning of service in a number of ways, including by deeming the service as an employee of a Public Authority to include periods during which the employee is not employed by the employer. That is the effect of cl 2(a) which provides that for the purpose of these conditions ‘service’ means service as an employee of a Public Authority and shall be deemed to include:
…
(v) absence of the employee on National Service or other military training, but only if the difference between the employees’ military pay and his civilian pay is made up, or would, but for the fact that his military pay exceeds his civilian pay, be made up by his employer;
… and
(ix) employment in the service of the Commonwealth or another State of Australia as provided in Clause 16 hereof, when employment in the State Government commences on or after 1 April 1974.
41 The respondents submit that this is the sense in which the Senior Commissioner relied on Browne [119] in UWU [34].
42 Furthermore, this interpretation is consistent with the sense in which ‘service’ should be understood in the Agreement; as the performance of work. The Union’s submission that ‘service’ should mean ‘employment’ should be rejected.
43 The respondents submit that s 46 of the Act is not intended to enable the Commission to declare the true meaning of terms implied by statute: Minister for Corrective Services [27]–‍‍[46].
44 The respondents submit that the decisions of Jones, UWU and Minister for Corrective Services should be followed, as a matter of comity, unless found to be plainly wrong.
45 Even if found to be wrong, the respondents submit that the Commission should not, as a matter of discretion, declare the true meaning of the implied terms, for the reasons outlined in Minister for Corrective Services [44].
The Union’s response to the respondents’ contentions
46 The Union contends that the respondents’ submission is to the effect that, despite cl 51.8 (at [5] above) being located within cl 51 – Personal Leave, it applies for all purposes beyond personal leave. If that was the intention, cl 51.8 would not have been included as a subclause of cl 51 but inserted as a standalone clause with general operation. Alternatively, language such as that used in cl 54.3(c) (at [20] above) that ‘[l]eave without pay for this purpose will not count as qualifying service for leave purposes’, or in cl 54.4(b) (at [20] above) that ‘[l]eave without pay for this purpose will count as qualifying service for all purposes…’, could have been used.
47 Therefore, and contrary to the respondents’ submissions, cls 51.8 (at [5] above) and 51.9(a)(ii) (at [9(i)] above) work together, to provide a cap of six months on workers’ compensation as counting as ‘service’ only for periods of personal leave. The cl 51.9(a) definition of ‘service’ does not apply to annual leave.
48 The respondents argue that cl 51.8 directs the reader to cl 51.4. While the Union agrees that cl 51.4 applies to employees who are ill or injured, the Union says cl 51.4 only applies to employees who have exhausted all of their personal leave. An employee exhausting all of their personal leave is not what occurs in a situation of workers’ compensation, thus cl 51.4 is not intended to apply to a workers’ compensation situation.
49 Further, the respondents’ contention that cl 51.8 directs the reader to cl 51.4 such that annual leave accruals are capped at three months, produces a textual clash between cl 51.4(b) capping the period of personal leave without pay at three months for the anniversary date of sick leave credits, and cl 51.9(a)(ii) capping the period of absences on workers’ compensation at six months for the definition of ‘service’ for the purpose of personal leave: [10(f)(i)] above.
50 Further, the respondents’ contention produces a textual clash with AI 610. While AI 610 caps sick leave, annual leave and long service leave at six months during a period of workers’ compensation, the Agreement only adopts the six months cap for the purposes of personal leave (cl 51.9(a)(ii)). The Agreement does not contain any cap for the purposes of annual leave and long service leave.
51 While there may have been historical changes to AI 610, the relevant condition in AI 610 capping sick leave, annual leave and long service leave at six months during a period of workers’ compensation has been in place for 35 or 40 years. As such, the Union submits that the possibility of AI 610 being repealed should have no bearing on the construction of the Agreement.
52 The Union disagrees that it needs to be established that AI 610 applies with legal force to all respondents. If AI 610 does not apply with legal force to some respondents, it is more likely than the alternative that those respondents would treat themselves as bound for comity with the other respondents during agreement negotiations.
53 In any event, it is an agreed fact that the respondents have been treating themselves as bound by AI 610 (ts 11).
54 Clause 51.2 of the Agreement states that there is no distinction between sick leave and personal leave (emphasis added):
The intention of personal leave is to give employees and employers greater flexibility by providing leave on full pay for a variety of personal purposes. Personal leave replaces sick, carers and short leave. Personal leave is not for circumstances normally met by other forms of leave.
55 The reference to ‘sick leave credits’ in cl 51.4(b) (at [5] above) is likely a slip. It is the only reference in the Agreement to ‘sick leave credits’. On the contrary, there are six references to ‘personal leave credits’ at cls 51.3(a), 51.3(f), 51.3(k), 51.7(a), 51.8 and 59.8.
56 The Union relies upon UWU [47] as the basis for which regard may be had to AI 610 in considering the industrial context. The Union submits that AI 610 does not have the character of extrinsic material alleged by the respondents. Rather, AI 610 is part of the fabric of the Agreement; part of the industrial context in which the text of cl 45.1(a) (at [5] above) is to be construed. The parties have, in places, directly lifted the conditions of AI 610 and inserted them into the Agreement:
AI 610
Agreement
Leave without pay:
Leave without pay and suspension from duty without pay which exceed 14 days in a continuous period is excised in full from qualifying service.
Clause 54.1(d):
Any continuous period of leave without pay exceeding 10 working days granted under this clause:
(i) does not count as service; and
(ii) does not constitute a break in continuous service.
Long service leave:
Any period during which an officer is absent from duty on long service leave is excised from qualifying leave.
Clause 55.6(a)(ii):
For the purpose of determining an employee’s long service leave entitlement, the expression ‘continuous service’ includes any period during which the employee is absent on full pay or part pay from duties in the College, but does not include:
(ii) any period during which an employee is taking long service leave entitlement or any portion thereof except in the case of sub-clause 55.7 when the period excised will equate to a full entitlement of 13 weeks;
Sick Leave Without Pay – Normal Illness:
Sick leave without pay not exceeding a period of three months in a continuous absence does not affect salary increment dates, anniversary date of sick leave credits, long service leave entitlements or annual leave entitlements. Where a period of sick leave without pay exceeds three months in a continuous absence, the period in excess of three months is excised from qualifying service.
Clause 51.4(b):
Personal leave without pay not exceeding a period of three (3) months in a continuous absence does not affect salary increment dates, anniversary date of sick leave credits, long service leave entitlements or annual leave entitlements. Where a period of personal leave without pay exceeds three (3) months in a continuous absence, the period in excess of three (3) months is excised from qualifying service.
Sick Leave Without Pay – Workers’ Compensation:
Since January 1, 1953, a period of sick leave without pay granted to an officer on account of an illness compensable under the provisions of the [WCIM Act], does not affect salary increment dates, the anniversary date of sick leave credits, long service leave entitlements or annual leave entitlements provided the period of leave granted does not exceed six months in a continuous absence. Where the period of sick leave granted does not exceed six months in a continuous absence, only the period in excess of six months is excised from qualifying service.
Clause 51.9(a)(ii):
any period which exceeds six (6) months in one continuous period during which an employee is absent on workers’ compensation. Provided that only that portion of such continuous absence which exceeds six months shall not count as ‘service’.
Leave Without Pay for Full Time Study
Where the chief executive officer agrees to grant leave without pay for full time studies, the officer who is granted leave without pay shall not have the absence count as qualifying service for leave purposes, unless the officer undertakes the study as a form of award or scholarship which has been competed for in which case consideration may be given to the absence counting as qualifying service for all purposes except annual leave.
Clause 54.3(c):
Leave without pay for this purpose will not count as qualifying service for leave purposes.
Leave Without Pay – Australian Institute of Sport Scholarship
An officer who is granted leave without pay to accept a scholarship from the Australian Institute of Sport shall have that absence count as qualifying service for all purposes except annual leave.
Clause 54.4(b):
Leave without pay for this purpose will count as qualifying service for all purposes except annual leave and professional leave.
57 The ‘Sick Leave Without Pay – Normal Illness’ provision in AI 610 has been adopted verbatim in cl 51.4(b), with the references in AI 610 to ‘sick leave without pay’ amended to ‘personal leave without pay’ to reflect the nomenclature of the Agreement. However, the reference to ‘sick leave credits’ has remained. This slip arose when the provision was copied from AI 610 into the Agreement.
58 AI 610 ‘Sick Leave Without Pay – Workers’ Compensation’ involving a six month cap for ‘sick leave credits, long service leave entitlements or annual leave entitlements’, is only partly reflected in the Agreement in cl 51.9(a)(ii) (at [56] above) for personal leave. The Union submits that this was a deliberate choice, made to provide more generous benefits in the Agreement.
59 However, if AI 610 cannot be considered as part of the industrial context of the Agreement, the word ‘service’ in cl 45.1(a) (at [5] above) is susceptible of more than one meaning – a broad meaning consistent with a period of employment, and a narrow meaning confined to the performance of work – which opens the gateway to have regard to AI 610 as extrinsic material.
60 The respondents’ submissions that the Agreement distinguishes between ‘service’ and ‘employment’ should be rejected because:
(a) Clause 32.1 (at [31(c)] above) deals with higher duties; it does not deal with a leave entitlement, and different terminology is adopted to better capture the situation being dealt with.
(b) Cultural leave and family and domestic violence leave in cls 50.2 and 52.7 (at [31(c)] above) do not carry over from year to year; they are not service-based since employees simply receive a yearly allocation to this leave of five days and 10 days respectively. They receive this allocation whether they are employed on a fulltime or a parttime basis. In the case of family and domestic violence leave, casuals also receive this allocation. It would be impossible for a casual employee to be allocated the full quota of 10 days family and domestic violence leave if the allocation was determined by anything other than a period of time, which in the case of cl 52.7 is a calendar year.
(c) The higher duties, cultural leave and the family and domestic violence leave clauses at (a)–(b) above involve different concepts which do not bear upon the meaning of cl 45.1(a); which should be determined by reference to the comparison with the personal leave arrangements and by comparison to AI 610.
(d) Clause 22.3 is headed ‘Contract of Employment’ but the clause itself uses ‘contract of service’. The clause uses the word ‘employment’ and ‘service’ interchangeably to mean the same thing:
22.3 Contract of Employment
In the absence of any other period of notice specified in the contract of service, the provision of this clause will also apply to fixed term contract employees.
61 The Union submits that Jones is not binding on the Commission for the following reasons. Firstly, it is a decision of an inferior court (ts 18). Secondly, the Industrial Magistrate only superficially considered s 23(1) of the MCE Act as Jones involved the worker bringing a number of different claims. Thirdly, the Senior Commissioner in UWU appears to refer to Jones only in obiter.
62 Despite this, the Commission must still engage with the correctness of Jones because the MCE Act in its own right is part of the industrial context in which the Agreement was made; the MCE Act forms part of the context within which cl 45.1(a) must be construed: Minister for Corrective Services [26]:
26 Of course, in construing the terms of an Industrial Agreement, the Commission may be required to consider and determine the meaning of a statute, including the provisions of the [MCE Act], as relevant context and a step in the construction process: Western Australian Prison Officers’ Union of Workers v Minister for Corrective Services [2023] WAIRC 00773; and The Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch v Public Transport Authority of Western Australia [2015] WAIRC 00797.
63 Accordingly, if s 23(1) of the MCE Act extends to workers’ compensation absences, it follows that, objectively, the parties would have intended cl 45.1(a) (at [5] above) to extend to workers’ compensation absences. If s 23(1) of the MCE Act is found not to extend to workers’ compensation absences, then in the alternative, the Union submits that the term ‘service’ in cl 45.1(a) was in any event meant to extend to workers’ compensation absences for the reasons outlined regarding the context of the Agreement itself and the broader context of AI 610. This is because the same term can have different meanings in different instruments: Kucks.
Consideration
64 I agree with the respondents’ submissions that the following decisions of the Industrial Appeal Court (IAC) and Full Bench are binding on the Commission: Director General, Fedec and ARTBIU.
65 Director General is an IAC decision delivered on 18 December 2013, in which Pullin J (with Le Miere J agreeing) outlined the principles for construing an industrial agreement known as the Education Assistants’ (Government) General Agreement 2010 at [18]–[20] and [22].
66 Director General [18]–[19] is cited in Fedec [23] (at [8(a)] above). Director General [19]–‍‍[20] is cited at [8(b)] above. In Director General [22], Pullin J cites Geo as follows:
Allowing for the fact that industrial agreements are not always framed with that careful attention to form and draftsmanship which one expects to find in an Act of Parliament (see [Geo], 503), it is clear by reading the whole of cl 10 that the parties intended that the Director General would be obliged to ensure that all new employees and redeployees would attend induction sessions (cl 10.1) and that the Department, of which the Director General was CEO, would develop an induction ‘package’ for education assistants (cl 10.2). Clause 10.3 of the Agreement should be interpreted as providing that the induction package developed by departmental officers would be presented to new employees and redeployees at places then described as district offices by employees of the Department who were qualified to carry out the induction. A building cannot be ‘responsible’ for inductions. Neither party contended otherwise on this appeal. Thus ‘district offices’ meant the places which at the time the Agreement was entered into, were called district offices or district education offices and which were staffed by persons with the qualifications to carry out inductions. The Director General was obliged to ensure that such persons would carry out the inductions at those places.
67 Fedec is a Full Bench decision delivered on 19 September 2017, in which Smith AP and Scott CC outlined the approach to be applied when interpreting an industrial agreement, under the heading ‘Interpreting an industrial agreement – general principles of interpretation’: Fedec [21]–‍[23] at [8(a)] above.
68 Fedec [21] cites Geo as authority for the ‘well established’ ‘approach that is to be applied when interpreting an industrial agreement’ that ‘industrial agreements are made for industries in light of the customs and working conditions of each industry and must not be interpreted in a vacuum divorced from industrial realities’.
69 Fedec [22] cites the Supreme Court of Western Australia decision of Re Harrison [50]–‍[51]. Re Harrison involved an application for a writ of certiorari quashing a particular clause of an industrial agreement. In Re Harrison [50], Beech J outlines six ‘well-known’ ‘general principles relevant to the proper construction of instruments’. In Re Harrison ‍[51], Beech J cites Director General [18]–‍[20] (Pullin J, Le Miere J agreeing) and Director General [83] (Buss J) as authority for the conclusion that the general principles in Re Harrison [50] ‘apply in the construction of an industrial agreement’.
70 Fedec [23] cites Director General [18]–‍[19] as the principles to be added to those at Fedec [22].
71 ARTBIU is a Full Bench decision delivered on the same day as Fedec. In ARTBIU [78]–‍‍[79], Smith AP with Scott CC agreeing, under the heading ‘Interpreting an industrial agreement – general principles of interpretation’, cites the principles in Director General as ‘to be applied by the Commission when hearing and determining an application for the true interpretation of an award as defined under s 46 of the Act, which includes an industrial agreement’. In ARTBIU [78]–‍[79], the majority summarise Director General [18]–[22], before citing Re Harrison [50]–‍[51], and concluding (at ARTBIU [80]) that:
Thus, it appears clear that, in interpreting industrial agreements, they are:
(a) to be interpreted generously;
(b) drafted without the careful attention given to the form of a statutory instrument;
(c) enforceable at law within a statutory context and a person bound cannot be freed or discharged from any liability or penalty or from the obligation by reasons of any contractual provision (s 114(1) of the Act); and
(d) to be interpreted in light of the context of the industrial character and purpose of an industrial agreement not divorced from industrial realities in the industry to which an industrial agreement extends.
72 In ARTBIU [99], under the heading ‘Interpretation or a decision on the facts for enforcement?’, Smith AP with Scott CC agreeing say the following, before concluding at ARTBIU [100] (at [27] above) on the principles that ‘emerge in respect of an award as defined in s 46(5)’ (which defines an ‘award’ in s 46 to include an industrial agreement):
99 It is plain that by the enactment of the power to vary an award (as defined in s 46(5)), the power to declare the true meaning of an award is wider than the power to interpret that was conferred on the Federal Court by s 110 of the Conciliation and Arbitration Act and successive provisions of the Industrial Relations Act 1988 and the Workplace Relations Act.
73 Relevantly, ARTBIU [100] (at [27] above) provides that:
(a) The power under s 46 is first to determine whether ambiguity arises.
(b) Only if there is ambiguity, can the Commission embark upon a factfinding exercise to determine the surrounding circumstances that existed when the industrial agreement was made.
(c) If there is no ambiguity, then the surrounding circumstances do not fall to be considered under s 46.
74 Fedec [21]–‍‍[23] has been adopted and applied by the Full Bench in:
(a) Pearce v Commissioner of Police, Western Australia Police [2019] WAIRC 00201 [14].
(b) Western Australian Prison Officers’ Union of Workers v Minister for Corrective Services [2024] WAIRC 00139 [34].
(c) Western Australian Prison Officers’ Union of Workers v Minister for Corrective Services [2024] WAIRC 00227 [16].
(d) Minister for Corrective Services v Western Australian Prison Officers’ Union of Workers [2024] WAIRC 00758 [20].
(e) Minister for Corrective Services v Western Australian Prison Officers’ Union of Workers [2024] WAIRC 00825 [28].
(f) Minister for Corrective Services v Western Australian Prison Officers’ Union of Workers; Western Australian Prison Officers’ Union of Workers v Minister for Corrective Services [2024] WAIRC 01034 [201].
75 Relevantly, Fedec [23] (at [8(a)] above) states that the Commission can only take into account surrounding circumstances if the ordinary meaning of the words is ambiguous or susceptible of more than one meaning.
76 Applying Fedec and ARTBIU, the starting point for interpreting cls 45.1(a), 51.4(b) and 51.8 is the ordinary meaning of the words, taken as a whole and considered in the context of the Agreement’s industrial context and purpose. If this approach does not reveal ambiguity, it would be impermissible to consider surrounding circumstances, including AI 610.
Clause 51.8 – Workers’ Compensation
77 Clause 51.8 (at [5] above), headed ‘Workers’ Compensation’, is a sub-clause of cl 51 – Personal Leave, and applies ‘Where an employee suffers a disability within the meaning of section 5 of the [WCIM Act]’.
78 Research undertaken by the Commission indicates that:
(a) Section 5 of the original WCIM Act as passed in 1981 included the following definition of ‘disability’:
‘disability’ means –
(a) a personal injury by accident arising out of or in the course of the employment, or whilst the worker is acting under the employer’s instructions;
(b) a disabling disease to which Part III Division 3 applies;
(c) a disease contracted by a worker in the course of his employment at or away from his place of employment and to which the employment was a contributing factor and contributed to a recognizable degree;
(d) the recurrence, aggravation, or acceleration of any pre-existing disease where the employment was a contributing factor to that recurrence, aggravation, or acceleration and contributed to a recognizable degree; or
(e) a disabling loss of function to which Part III Division 4 applies;
(b) The definition of ‘disability’ was replaced with the following definition of ‘injury’ by s 8 of the Workers’ Compensation Reform Act 2004 (WA):
‘injury’ means –
(a) a personal injury by accident arising out of or in the course of the employment, or whilst the worker is acting under the employer’s instructions;
(b) a disease because of which an injury occurs under section 32 or 33;
(c) a disease contracted by a worker in the course of his employment at or away from his place of employment and to which the employment was a contributing factor and contributed to a significant degree;
(d) the recurrence, aggravation, or acceleration of any pre-existing disease where the employment was a contributing factor to that recurrence, aggravation, or acceleration and contributed to a significant degree; or
(e) a loss of function that occurs in the circumstances mentioned in section 49,
but does not include a disease caused by stress if the stress wholly or predominantly arises from a matter mentioned in subsection (4) unless the matter is mentioned in paragraph (a) or (b) of that subsection and is unreasonable and harsh on the part of the employer;
(c) The Explanatory Memorandum to the Workers’ Compensation Reform Bill 2004 (WA) states:
The existing definition of ‘disability’ is replaced with ‘injury’ which is consistent with the term used in other States. It is not intended to change the meaning of the current definition, only the title.
(d) Except to add the word ‘or’ at the end of subparagraphs (a), (b) and (c) of the definition of ‘injury’ in the version of the WCIM Act at [6] above, the definition of ‘injury’ has remained unchanged since introduced.
79 Therefore, in cl 51.8, the words ‘Where an employee suffers a disability within the meaning of section 5 of the [WCIM Act]’ should be understood as ‘Where an employee suffers an injury within the meaning of section 5 of the [WCIM Act]’.
80 The Macquarie Dictionary defines ‘suffer’ as including:
2. to sustain injury, disadvantage or loss.
6. to undergo, experience, or be subjected to (pain, distress, injury, loss, or anything unpleasant).
81 Applying the ordinary meaning of ‘suffer’ to cl 51.8, the clause applies where an employee sustains injury compensable under the WCIM Act. If the injury is not compensable under the WCIM Act, the employee would not suffer an injury within the meaning of s 5 of the WCIM Act. In such cases, the employee may sustain an injury, but it is not an injury ‘within the meaning of s 5 of the WCIM Act’.
82 This interpretation is wholly consistent with the agreed permissible revised declaration (at [4(b)] above) concerning periods when ‘an employee is absent from work and receiving compensation payments under the WCIM Act.’
83 Clause 51.8 contains two sentences:
(a) The first sentence states that, where an employee is absent from duty because of a WCIM Act compensable injury, the employer shall grant the employee personal leave with pay, to the extent of the employee’s personal leave credits (Part 1 of cl 51.8).
(b) The second sentence states that, once the workers’ compensation claim is decided in the employee’s favour, the employer is to reinstate the employee’s personal leave credits and shall grant the period of absence as personal leave without pay (Part 2 of cl 51.8).
84 The Union submits that cl 51.8 does not extend to annual leave because it is a sub-clause of a clause concerning personal leave. I do not accept this submission for the following reasons.
85 It is clear, based on the ordinary meaning of the words, that cl 51.8 is part of cl 51 – Personal Leave, because Part 1 of cl 51.8 states that an employee who is absent because of a compensable injury under the WCIM Act, ‘shall be granted’ personal leave with pay. The grant of personal leave with pay is subject to the employee’s personal leave credits.
86 Under s 56 of the Interpretation Act 1984 (WA), the word ‘shall’ in the context of conferring a function, means the function ‘must’ be performed:
56. ‘May’ imports a discretion, ‘shall’ is imperative
(1) Where in a written law the word may is used in conferring a power, such word shall be interpreted to imply that the power so conferred may be exercised or not, at discretion.
(2) Where in a written law the word shall is used in conferring a function, such word shall be interpreted to mean that the function so conferred must be performed.
87 There is nothing to suggest that the word ‘shall’ in cl 51.8 should be read as conveying anything other than ‘must’. This means, where an employee suffers a compensable injury under the WCIM Act, the employer must grant them personal leave with pay, subject only to the employee’s personal leave credits.
88 As such, if the employee has personal leave credits covering the entire period of their absence, the employer must grant them personal leave with pay for the entire period (Scenario 1). If the employee only has personal leave credits covering a portion of their absence, the employer must grant them personal leave with pay for that portion (Scenario 2). If the employee does not have any personal leave credits, the employee has no entitlement to personal leave with pay for any part of their absence (Scenario 3).
89 Part 2 of cl 51.8 provides that, when the employee’s claim for workers’ compensation is decided in their favour, the employer is to reinstate their personal leave credit, and the ‘period of absence shall be granted as personal leave without pay’.
90 In the case of Scenario 1, cl 51.8 mandates the employer to treat the entire period of the absence as personal leave with pay, and when the workers’ compensation claim is decided in the employee’s favour, to reinstate the employee’s personal leave credit and treat the absence as personal leave without pay.
91 Which provision or provisions of the Agreement apply once cl 51.8 mandates the absence being treated as personal leave without pay upon the workers’ compensation claim being decided in the employee’s favour? In my view, this is necessarily cl 51.4 – Personal Leave Without Pay.
Clause 51.4 – Personal Leave Without Pay
92 In the case of Scenario 1, since the employer must treat the absence as personal leave without pay, cl 51.4(a) (at [10(c)] above) would not apply, as the employee would not be required to apply for personal leave without pay. However, cl 51.4(b) (at [5] above) would apply. This means that only three months of the employee’s absence due to their injury under the WCIM Act is counted for the purposes of salary increment dates, and the anniversary date of sick leave credits, long service leave entitlements and annual leave entitlements. The period of absence exceeding three months is excised from qualifying as service for the purposes of salary increment dates, and the anniversary date of sick leave credits, long service leave entitlements and annual leave entitlements.
93 In the case of Scenario 2, the employee has a portion of their absence covered by their personal leave credits and a portion of their absence that is not. Clause 51.8 (at [5] above) provides that the portion covered by their credits and granted as personal leave with pay, is to be reinstated upon the employee’s workers’ compensation claim being decided in their favour, and instead of being granted as personal leave with pay, it must be granted as personal leave without pay. This is the same outcome as Scenario 1. What about the portion of the employee’s absence that is not covered by their personal leave credits and not originally granted as personal leave with pay? The employee ‘may apply’ for personal leave without pay under cl 51.4 because they would ‘have exhausted all of their personal leave entitlements and are ill or injured’ (cl 51.4(a) at [10(c)] above). They would need to ‘complete the necessary application and produce medical evidence’ to support their application. If the employee’s application for personal leave without pay is approved, cl 51.4(b) (at [5] above) would apply to the period of absence, such that only three months of the personal leave without pay is counted for the purposes of salary increment dates, and the anniversary date of sick leave credits, long service leave entitlements and annual leave entitlements.
94 Likewise in the case of Scenario 3, the employee ‘may apply’ for personal leave without pay under cl 51.4(a). If approved, cl 51.4(b) applies, such that only three months of the personal leave without pay is counted for the purposes of salary increment dates, and the anniversary date of sick leave credits, long service leave entitlements and annual leave entitlements.
95 The application of cl 51.4(b) to cl 51.8 (at [5] above) in the above scenarios is consistent with cl 51.9(a)(iii) (emphasis added):
51 PERSONAL LEAVE
51.9 Continuous Service
(a) For the purposes of this clause ‘service’ shall not include:
…
(iii) any period which exceeds three (3) months in one continuous period during which an employee is absent on personal leave without pay. Provided that only that portion of such continuous absence which exceeds three (3) months shall not count as ‘service’.
Contextual clashes?
96 The Union submits that an interpretation that cl 51.8 directs the reader to cl 51.4(b) produces contextual clashes between cls 51.4(b) and 51.9(a)(ii):
51 PERSONAL LEAVE
51.9 Continuous Service
(a) For the purposes of this clause ‘service’ shall not include:
…
(ii) any period which exceeds six (6) months in one continuous period during which an employee is absent on workers’ compensation. Provided that only that portion of such continuous absence which exceeds six months shall not count as ‘service’;
97 The respondents deny this is the case, arguing that cl 51.4(b) involves sick leave credits and cl 51.9(a)(ii) (at [96] above) involves the definition of continuous service for the purposes of personal leave. The respondents rely on cl 51.1 that the provisions of cl 51 replaces the sick leave clause of the Award ‘with the exception of sub-clause 27(23) (war caused illnesses)’ in support of its argument that cl 51.4(b) refers to sick leave credits accrued under cl 27(23) of the Award.
98 The Union relies on cl 51.2 (at [54] above) that ‘personal leave replaces sick, carers and short leave’ in support of its argument that personal leave credits and sick leave credits mean the same thing under the Agreement and the reference to sick leave credits in cl 54.1(b) is a slip.
99 Clause 51.1 states that it replaces cls 27 – Sick Leave and 30 – Short Leave of the Award, and that cl 27(23) (war caused illnesses) of the Award continues to apply. The Agreement defines ‘Award’ as meaning ‘the Teachers (Public Sector Technical and Further Education) Award 1993, and/or the Community Colleges Award 1990, or any replacement awards’. The references in cl 51.1 to the Award, refers only to the Teachers (Public Sector Technical and Further Education) Award 1993, for the reasons that follow.
100 The first sentence in cl 51.2 (at [54] above) states the intention of personal leave. The second sentence in cl 51.2 states that ‘personal leave replaces sick, carers and short leave’. While this sentence does not reference either Award, the combined effect of cls 51.1 and 51.2 should be understood as cl 51 of the Agreement replacing:
(a) Clauses 27 – Sick Leave and 30 – Short Leave of the Teachers (Public Sector Technical and Further Education) Award 1993, other than cl 27(23), as this award does not contain a provision providing for carer’s leave.
(b) Clause 14 – Sick Leave of the Community Colleges Award 1990, as this award does not contain a provision providing for carer’s leave, short leave or war caused illnesses leave.
101 It is clear that cl 51.1 preserves the entitlement to war caused illnesses leave under cl 27(23) of the Teachers (Public Sector Technical and Further Education) Award 1993. This clause provides that an employee ‘who is absent from duty because of a war-caused injury or disability is entitled, in addition to any other sick leave credit provided for under this award, to an additional credit in working days towards sick leave on full pay’. The balance of the clause defines a ‘war-caused injury or disability’ and outlines the use of this sick leave credit.
102 While I agree that cl 51.4 applies to the anniversary date of the warcaused injury sick leave credit, I disagree that the clause only applies to the anniversary date of this type of sick leave credit. Instead, I agree with the Union that the reference to sick leave credits in cl 51.4(b) (at [5] above) is more likely a slip and should refer to personal leave credits for the following reasons.
103 Firstly, cl 51.4(c) provides that personal leave without pay is only available to employees who have exhausted their personal leave entitlements and are seeking leave for a circumstance other than those outlined in cls 51.5(a)(ii)–(iv). The only other circumstance in cl 51.5(a) is specified in cl 51.5(a)(i), namely ‘where the employee is ill or injured’. This aligns with cl 51.4(a) (at [10(c)] above) which limits the applications for personal leave without pay to employees ‘who have exhausted all of their personal leave entitlements and are ill or injured’.
104 Read as a whole, it is more likely that cl 51.4(b) operates to limit the accrual of personal leave credits under cl 51.3(a) of the Agreement (at [9(i)] above), rather than limit sick leave credits under cl 27(23) of the Teachers (Public Sector Technical and Further Education) Award 1993, where an employee is on personal leave without pay exceeding three months.
105 Secondly, this interpretation is consistent with cl 51.9(a)(iii) (at [9(i)] above), which explicitly states that ‘service’ for the purposes of cl 51 – Personal Leave, does not include periods exceeding three months of an employee’s absence on personal leave without pay.
106 Thirdly, the other occasion where ‘sick leave credits’ is used is at cl 51.10 (emphasis added):
51.10 Portability
Where an employee was, immediately prior to being employed in the public authority, employed in the service of the public service of Western Australia or any other State body of Western Australia and the period between the date when the employee ceased previous employment and the date of commencing employment in the public authority does not exceed one (1) week or such other period as approved by the Managing Director, the Managing Director may credit that employee additional sick leave credits up to those held at the date the employee ceased previous employment.
107 The parties did not provide any submissions on whether the reference to ‘sick leave credits’ in cl 51.10 (at [106] above) should have the same or a different meaning to the reference to ‘sick leave credits’ in cl 51.4(b) (at [5] above). However, in my view, it would be consistent with the principles in Re Harrison [50(5)–‍(6)] as cited in Fedec [22] at [8(a)] above, and avoid nonsense and inconvenience, for both of the references to ‘sick leave credits’ in cls 51.4(b) and 51.10 to be understood as a slip and to be construed as a reference to ‘personal leave credits’.
108 Such an interpretation is consistent with each of the other instances of ‘personal leave credits’ identified by the Union at [55] above.
109 The significance of this interpretation is that where an employee is on leave without pay under cl 51.4 for a period exceeding three months, in addition to ceasing to accrue long service leave entitlements under cl 55.1(a) and annual leave entitlements under cl 45.1(a) (at [5] above), they will cease accruing personal leave credits under cl 51.3(a) (at [9(i)] above) of the Agreement.
110 As outlined at [83] above, cl 51.8 (at [5] above) contains two parts. Part 1 of cl 51.8 only applies if the employee has personal leave credits. If the employee does not have personal leave credits, the employee may apply for personal leave without pay under cl 51.4(a) (at [10(c)] above), resulting in cl 51.4(b) applying to limit the accrual of personal leave, annual leave and long service leave entitlements to three months of the employee’s absence on personal leave without pay. This is consistent with cl 51.9(a)(iii) (at [9(i)] above).
111 Part 2 of cl 51.8 only applies where the employee’s claim for workers’ compensation is decided in their favour. At that time, the employer is required to convert the employee’s personal leave with pay to personal leave without pay, resulting in cl 51.4(b) limiting the accrual of personal leave, annual leave and long service leave entitlements to three months of the employee’s absence on personal leave without pay. This is consistent with cl 51.9(a)(iii).
112 Clauses 51.4(b), 51.8 and 51.9(a)(iii) operate harmoniously where:
(a) Either Part 1 of cl 51.8 or Part 2 of cl 51.8 applies but the employee has no, or insufficient, personal leave credits to cover their absence on workers’ compensation and applies for personal leave without pay under cl 51.4(a).
(b) Part 2 of cl 51.8 applies and the employee has personal leave credits to cover their absence on workers’ compensation.
113 If an employee has personal leave credits but their workers’ compensation claim has yet to be decided in their favour, only Part 1 of cl 51.8 applies. The employee is absent on personal leave with pay. The employee is yet to be absent on personal leave without pay in accordance with Part 2 of cl 51.8, read consistently with cl 51.9(a)(iii). In my view, and for the reasons that follow, the employee would be ‘absent on workers’ compensation’ in accordance with cl 51.9(a)(ii) (at [9(i)] above).
114 An employee in the situation outlined in [113] above, who is only covered by Part 1 of cl 51.8, is on personal leave with pay. While on personal leave with pay, the employee is credited personal leave credits under cl 51.3(a). However, cl 51.9(a)(ii) applies to limit the employee’s personal leave credits to six months of service when the employee is absent on workers’ compensation for a period exceeding six months.
115 When the employee’s workers’ compensation claim is decided in their favour, their personal leave credit is reinstated, and the period of absence is converted to personal leave without pay pursuant to Part 2 of cl 51.8, at which time cl 51.4(b) applies.
116 Upon this interpretation, cls 51.8 and 51.9(a)(ii) operate in harmony with each other. Furthermore, there is no inconsistency in the operation of cls 51.4(a), 51.4(b), 51.8, 51.9(a)(ii) and 51.9(a)(iii), as each provision works in conjunction with the others to provide a clear and consistent framework for personal leave entitlements.
117 This construction ensures harmony between:
(a) Clauses 51.9(a)(i) (at [9(i)] above), 54.1(d) (at [20] above) and 55.6(a)(i), that periods exceeding 14 calendar days (or 10 working days or two weeks) of leave without pay, do not count as service for any purpose (cl 54.1(d)), for the purpose of personal leave (cl 51.9(a)(i)), and for the purpose of determining an employee’s long service leave entitlement (cl 55.6(a)(i)).
(b) Clauses 51.9(a)(ii) (at [9(i)] above) and 51.8 (at [5] above), that periods exceeding six months workers’ compensation absences do not count as service for the purpose of personal leave (cl 51.9(a)(ii)).
(c) Clauses 51.9(a)(iii) (at [9(i)] above), 51.8 and 51.4(b) (at [5] above), that periods exceeding three months personal leave without pay do not count as service for salary increment dates, personal leave credits, long service leave entitlements or annual leave entitlements (cl 51.4(b)), and for the purpose of personal leave (cl 51.9(a)(iii)).
118 This construction ensures regard to the Agreement as a whole, with a view to achieving harmony across the various parts of the Agreement, ensuring each part of the Agreement has operation: Director General [83] at [7(b)] above; Fedec [22] at [8(a)] above; Re Harrison [50(6)] at [8(b)] above; Black Box [42(6)] at [30] above.
119 Contrary to the second paragraph of the proposed declaration at [4(b)] above, I find that, upon proper interpretation of the Agreement, cls 51.4(b) and 51.8 apply to limit annual leave entitlements in situations where an employee is absent from work and receiving workers’ compensation payments.
120 This interpretation is supported by the ordinary meaning of the words, which reveals no ambiguity. As such, it would be impermissible to consider surrounding circumstances, including AI 610, in support of the Union’s argument: Fedec [23] at [8(a)] above; Director General [19] at [8(b)] and [28] above; ARTBIU [100] at [27] above.
121 Having arrived at this construction, I agree with the respondents’ submission that it is unnecessary to engage with the Union’s submissions regarding the definition of ‘year of service’ in cl 45.1(a).
AI 610
122 As to the Union’s argument that AI 610 can be considered as part of the Agreement’s industrial context, this is rejected for the following reasons.
123 Firstly, the Union’s argument appears to rely upon the statement in UWU [47], that ‘it is legitimate to look at the history of the clause for the purpose of construing it’.
124 Two cases are cited in UWU [47] as authority for this proposition: Hercus and FreshFood Management Services Pty Ltd v ‘Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union’ known as the Australian Manufacturing Workers’ Union (AMWU) [2023] FWCFB 97 (FreshFood).
125 Hercus is a decision of the Federal Court of Australia (FCA) delivered on 23 February 1993 involving the interpretation of the redundancy provision in a federal award. FreshFood is a decision of the Full Bench of the FWC (FWCFB) delivered on 29 June 2023, involving the interpretation of the personal leave and compassionate/bereavement leave provisions of a federal enterprise agreement. Being decisions in the federal jurisdiction, neither Hercus nor FreshFood strictly adopt and apply the principles to interpretation of an industrial agreement outlined at [64] above that is binding on the Commission.
126 Furthermore, on a reading of UWU as a whole, I agree with the respondents’ submission that the Union’s reliance on UWU [47] is misplaced, for the following reasons.
127 In UWU [47], the Commission refers to Hercus and FreshFood in the context of addressing the approach taken by the respondents (UWU [44]) of arguing for their purported construction by ‘carefully tracking the interaction between the applicable awards, industrial agreement and the LSL Act’.
128 In the paragraph immediately following UWU [47], the Commission said:
48 However, the [respondents] reliance on the history of the casual LSL clause involves a non sequitur. The conclusion that there is ambiguity does not follow from the premise. The history does not reveal some nuances of language or a problem with the ordinary meaning. The history does not reveal that the phrase now in question, ‘continuous service’, has historically been used to mean something other than its ordinary meaning, or that the parties had some common understanding about what the phrase meant. The history does not indicate a purpose or intent that is not apparent from the text of the agreement.
129 In UWU, the Commission concludes by stating that:
(a) The purported construction, argued to be ‘fair and reasonable in light of the historical position’, is ‘no basis to conclude the contended for construction is the correct construction’: UWU [134].
(b) The parties reading an industrial agreement should be able to work out what entitlement there is at a point in time, without having to go behind the industrial agreement to the history of the leave: UWU [136].
130 From the passages of UWU at [128]–‍[129] above, it is apparent that while UWU makes reference to Hercus and FreshFood as providing legitimacy for considering the history of a clause when construing it, the Commission in UWU does not adopt and apply the Hercus and FreshFood approach. Rather, the Commission concludes in UWU [136] (at [129(b)] above) that when it comes to interpreting provisions of an industrial agreement, the focus should be on the agreement itself and it should not be construed by going behind the agreement to the history of the provision.
131 Secondly, as outlined at [64] and [69] above, Fedec citing Re Harrison [50(3)–(4)] at [8(a)] above is binding on the Commission. In construing an agreement, the Commission may take into account the objectively ascertained purpose, which may invite attention to the genesis, background and context, which can be inferred from any admissible evidence of surrounding circumstances.
132 However, AI 610 does not rise to the standard of ‘admissible evidence’ of the objectively ascertained ‘genesis, background and context’, for the following reasons.
133 On 22 January 2024, the parties filed a Statement of Agreed Facts, setting out the evidence that is agreed as relevant to the task of construing the Agreement:
1. The applicant and the respondents have jointly prepared this Statement of Agreed Facts in accordance with direction 2 of the directions issued by Commissioner Tsang on 2 November 2023.
2. The applicant, [the Union], has standing to make this application pursuant to s 46(1) of the [Act] because the Union is an ‘organisation’ within the meaning of that term in the [Act]; and the Union is bound by the [Agreement] to which this application relates.
Facts giving rise to the dispute which resulted in the application
3. The following agreed facts in paragraph 4 to 8 are facts which are agreed for the purposes of giving context to the application which has been made, but it is not agreed that those facts are relevant for the purposes of construing the [Agreement].
…
Dispute about Disputed Period
9. The following agreed facts at paragraphs 10 to 12 are to give context to the dispute and the parties’ respective positions as to the dispute, but it is not agreed that those facts are relevant for the purposes of construing the [Agreement].
…
Bundle of Agreed Documents
13. A copy of the [Agreement] is included as Document 1 in the Bundle of Agreed Documents.
14. A copy of the 2019 Agreement is included as Document 2 in the Bundle of Agreed Documents.
15. The [Agreement] is, and the 2019 Agreement was:
15.1. an ‘industrial agreement’ within the meaning of that term in the [Act];
15.2. an ‘award’ within the meaning of that term in s 46 of the [Act]; and
15.3. by reason of the matters in paragraph [15.1]:
15.3.1. an ‘award’ and an ‘industrial instrument’ within the meaning of those terms in the MCE Act;
15.3.2. an ‘industrial award’ and ‘industrial agreement’ within the meaning of those terms in the WCIM Act.
16. A copy of [AI 610] is included as Document 3 in the Bundle of Agreed Documents.
134 Given the facts agreed by the parties as ‘relevant for the purposes of construing the [Agreement]’ are limited to those in the Statement of Agreed Facts and outlined at [133] above, I agree with the respondents that there is no evidence before the Commission that the parties had regard to AI 610 when drafting the Agreement (ts 32).
135 I also agree with the respondents that, while there may be similarities between the relevant sections of AI 610 and certain clauses of the Agreement, these similarities are insufficient to constitute evidence from which an inference can be drawn that the source of the Agreement’s clauses is AI 610, or that the parties made deliberate choices to include or exclude certain sections of AI 610 in the Agreement: (ts 32–33).
The Union’s alternative contention
136 The Union’s alternative contention is that:
(a) By ss 5(1) and 5(2) of the MCE Act, s 23(1) of the MCE Act (at [11] above) is taken to be implied in the Agreement, and any provision in the Agreement that is less favourable to an employee than s 23(1) of the MCE Act has no effect;
(b) An employee absent from work and receiving compensation payments under the WCIM Act is not on ‘unpaid leave’ under s 23(3) of the MCE Act. Therefore, the period of their absence is included in the reference to ‘year’ under s 23(1) of the MCE Act;
(c) Further, ‘year of service’ in s 23(1) of the MCE Act should be interpreted as ‘year of employment’;
(d) The import of (a)–‍(c) above is that an employee absent from work and receiving compensation payments under the WCIM Act is entitled to accrue paid annual leave under s 23(1) of the MCE Act during their absence, and to the extent that provisions of the Agreement provide otherwise, those provisions have no effect.
137 The difficulty with this alternative contention is that a very similar argument is raised in Jones, a decision delivered by Cicchini IM on 2 May 2001, and Cicchini IM found to the contrary.
138 The only difference between the current version of s 23(1) of the MCE Act and the version cited in Jones, is that s 23(1) currently refers to employees being entitled to up to 152 hours of paid annual leave for each year of service, whilst the version in Jones refers to the entitlement as being up to 160 hours for each year of service.
139 In Jones, Mr Jones argued that cl 21(10) of the AWU Gold (Mining and Processing) Award No A1 of 1992 (AWU Award) is inconsistent with s 23(1) of the MCE Act, and to the extent of the inconsistency, cl 21(10) of the AWU Award has no effect by virtue of s 5(2) of the MCE Act. Clause 21(10) of the AWU Award states:
(10) Any time in respect of which an employee is absent from work, except time which the employee entitled to claim sick pay, or time spent on holidays or annual leave as prescribed by this award shall not count for the purpose of determining an entitlement to annual leave.
140 Mr Jones argued that he is entitled to payment of annual leave for the period of annual leave accrued whilst on workers’ compensation. The employer denied that Mr Jones is entitled to accrue annual leave whilst on workers’ compensation. The employer said that there is no inconsistency between the MCE Act and the AWU Award. The employer argued that Mr Jones is only entitled to annual leave for ‘each year of service’ (s 23(1) of the MCE Act), accrued pro rata on a weekly basis (s 23(2) of the MCE Act). The employer argued that whilst on workers’ compensation, it cannot be said that Mr Jones is in the service of the employer.
141 Mr Jones argued that ‘each year of service’ in s 23(1) of the MCE Act is to be read ‘each year of employment’. Cicchini IM disagreed, and said:
The word ‘service’ has been specifically used by the legislature. It is not appropriate to substitute it with another word. ‘Service’ is capable of definition and has its own particular meaning. The CCH Macquarie Dictionary of Employment and Industrial Relations defines ‘service’ to mean –
the performance of duties as a servant; employment in duties or work for another.
It is apparent from the definition referred to above that the word ‘service’ connotes more than the contractual relationship between the employer and employee. Indeed it expressly addresses the performance of duties and the carrying out of work. It is axiomatic that duties are not performed and an employee does not carry out work whilst on workers’ compensation. Annual leave can only accrue whilst the employee is engaged in the regular performance of duties as a servant and during any consensual rest period that relates thereto. If an employee is precluded from carrying out such duties on account of injury, then during such period of incapacity the employee cannot be said to be providing a service to his or her employer notwithstanding that the employee remains within the employment relationship.
The complainant’s argument with respect to entitlement to annual leave whilst on workers’ compensation is contingent on my acceptance of the argument that the word ‘service’ in section 23(1) of the MCE Act should be read as ‘employment’. I do not accept that argument. The words are distinct and have distinct meanings. I do not accept the complainant’s argument that annual leave accrued to him whilst he was receiving weekly workers’ compensation payments. Accordingly I hold that the MCE Act and the award are not inconsistent with each other. The claim for unpaid annual leave cannot succeed.
142 Jones is cited in UWU, a decision of the Commission delivered on 9 August 2023. UWU involved an application under s 46 of the Act, for the Commission to declare the true interpretation of the ‘casual LSL clauses’ in two industrial agreements, defined in UWU as the Enrolled Nurses Agreement and the Hospital Support Workers Agreement. Specifically, the Commission was asked to decide the correct meaning of the phrase ‘continuous service’ in the casual LSL clauses.
143 The parties in UWU were in dispute about the way service should be recognised for the purpose of long serve leave under the casual LSL clauses, and contended for the following competing approaches:
6 UWU says that ‘continuous service’ under the casual LSL clauses includes all qualifying service with the relevant employer prior to the registration of the industrial agreements.
7 The HSPs say that ‘continuous service’ under the casual LSL clauses excludes service with the relevant employer prior to the registration of an industrial agreement which contained long service leave for casual employees.
144 Under the heading ‘Is there ambiguity?’, the Senior Commissioner said: UWU [33]–[42]:
Is there ambiguity?
33 The Enrolled Nurses Agreement uses the term ‘continuous service’ in several places. It defines ‘service’ for some specific clauses, but it does not define ‘service’ or ‘continuous service’ for general purposes.
34 The term ‘continuous service’ has a commonly understood, plain, industrial meaning derived from the combination of the ordinary common sense meaning of the two words that it comprises: ‘continuous’ meaning a connected and unbroken period and ‘service’ meaning experience performing duties for an employer: see [Browne] [119], Holland v UGL Resources Pty Ltd T/A UGL Resources [2012] FWA 3453 at [20][22] and McCallum, R. C, Butterworths Employment and Law Dictionary, (1997).
35 ‘Continuous service’ ordinarily means a period of unbroken service to an employer by an employee.
36 In some places, the Enrolled Nurses Agreement uses the different phrase ‘continuous employment’. The distinction between ‘service’ and ‘employment’ was considered by Cicchini IM in [Jones]. The issue in that case was whether annual leave accrued under the MCE Act while an employee was not at work but in receipt of workers’ compensation payments. The MCE Act provided for annual leave to accrue for ‘each year of service’. The learned Industrial Magistrate said at 11881189 (original emphasis):
The complainant argues for the reasons previously stated that ‘each year of service’ is to be read ‘each year of employment’. I respectfully disagree. The word ‘service’ has been specifically used by the legislature. It is not appropriate to substitute it with another word. ‘Service’ is capable of definition and has its own particular meaning. The CCH Macquarie Dictionary of Employment and Industrial Relations defines ‘service’ to mean:
the performance of duties as a servant; employment in duties or work for another.
It is apparent from the definition referred to above that the word ‘service’ connotes more than the contractual relationship between the employer and employee. Indeed it expressly addresses the performance of duties and the carrying out of work. It is axiomatic that duties are not performed and an employee does not carry out work whilst on workers’ compensation. Annual leave can only accrue whilst the employee is engaged in the regular performance of duties as a servant and during any consensual rest period that relates thereto. If an employee is precluded from carrying out such duties on account of injury, then during such period of incapacity the employee cannot be said to be providing a service to his or her employer notwithstanding that the employee remains within the employment relationship.
37 The HSPs have not pointed to anything in the text of the Enrolled Nurses Agreement, read as a whole, that suggests the term does not have its ordinary meaning.
38 I find nothing in the agreement, read as a whole, which tells against it having its ordinary meaning. Rather, there are several factors which favour the ordinary meaning.
39 First, the frequency of the use of the term throughout the agreement is itself an indication that the term has a plain and commonly understood meaning, and that the ordinary meaning is being invoked.
40 Second, there are instances where the ordinary meaning is expressly enlarged or qualified: cl 24, cl 32 and cl 43. This indicates that in the absence of qualification or enlargement, the term is intended to have its ordinary meaning.
41 Third, the nature of service related entitlements themselves indicate that the term is intended to have its ordinary meaning. For example, it would be industrially nonsensical for notice of termination of employment to be determined by continuous service if the term meant something other than unbroken consecutive service with the employer. If continuous service was limited to post2020 service, the whole idea of notice of termination being linked to longevity of service is undermined.
42 Words used in an industrial agreement should be given meaning so as to operate consistently and harmoniously, with the agreement read as a whole. It would be contrary to this principle to give the term ‘continuous service’ its ordinary meaning for some purposes, but a different, qualified meaning in the casual LSL clause.
145 It is apparent from UWU [33]–[42], that Jones is cited as support for ‘continuous service’ in the respective casual LSL clauses having its ordinary meaning, which Cicchini IM references in Jones as ‘the performance of duties as a servant; employment in duties or work for another’ as defined by the CCH Macquarie Dictionary of Employment and Industrial Relations, and which the Senior Commissioner said at UWU [34], has a commonly understood, plain, industrial meaning as ‘performing duties for an employer’.
146 UWU does not cite Jones as endorsement of Cicchini IM’s conclusion that an employee does not accrue annual leave under s 23(1) of the MCE Act while receiving workers’ compensation payments. The accrual of annual leave under s 23(1) of the MCE Act while receiving workers’ compensation payments is not a matter that arose in UWU. Both counsel agree that Jones is the only decision known to them where the issue of the accrual of annual leave under s 23(1) of the MCE Act while receiving workers’ compensation payments under the WCIM Act has arisen.
147 It is not in dispute that ss 49 and 84 of the Act provide that appeals lie to the Full Bench from decisions of the Industrial Magistrates Court and decisions of the Commission, thereby creating a common appellate hierarchy.
148 The Union contends that Jones should not be followed because Cicchini IM is ‘plainly wrong’. The respondents contend that Jones should be followed unless Cicchini IM is ‘plainly wrong’.
149 The Union contends that Jones is wrongly decided because the words ‘year of service’ in s 23(1) of the MCE Act is not interpreted consistently with the ordinary meaning of ‘service’, as meaning a year of employment, consistently with the following cases that the Union relies upon:
(a) Browne at [9(b)–‍(c)] and [12] above;
(b) Peabody at [9(b)] and [12] above;
(c) Graham at [13(b)(i)] above;
(d) PTA at [13(b)(ii)] above;
(e) Bambach at [15(a)] above;
(f) Hall at [15(b)] above;
(g) Rankin [15(c)] above; and
(h) Touhey at [15(d)] above.
150 Browne, Peabody and Graham do not support the Union’s contentions for the following reasons.
151 Browne is a decision of the IAC, delivered on 11 February 2020, involving an appeal to the IAC on the question of whether Mr Browne’s prior service in the Tasmanian public service should be taken into account with his service in the Western Australian public service when calculating his entitlement to a severance payment. The appeal involved the proper construction of the phrase ‘each complete year of continuous service served by the employee in the Public Sector’ in reg 13(2) of the Public Sector Management (Redeployment and Redundancy) Regulations 2014 (WA) (Redundancy Regulations), in circumstances where reg 3 defines ‘continuous service’ as having the same meaning as it has in the repealed Award Wages Employees’ Long Service Leave General Order (General Order).
152 Buss & Murphy JJ (Browne [46]) noted that the phrase ‘continuous service’ is not defined in the General Order, but that the word ‘continuous’ in its ordinary meaning includes ‘unbroken’, and in the context of cl 1 of the General Order, applies both to unbroken years of service, and to service within a year of service which is unbroken. Their Honours noted (Browne [47]–‍‍[49]) that cl 2(a) of the General Order states that the word ‘service’ means ‘service as an employee of a Public Authority and shall be deemed to include’ the matters in cl 2(a)(i)–‍(ix) of the General Order: (footnotes omitted)
47 Clause 2(a) provides that the word ‘service’, for the purposes of the [General Order], means ‘service as an employee of a Public Authority’. The content of its meaning is not defined, but its scope is enlarged upon by cl 2(a), which also provides that ‘service’ shall ‘be deemed to include’ the matters in pars (i) to (ix) of cl 2(a). As a result, and in general terms, ‘service as an employee of a Public Authority’ is deemed to include:
1. Where the employee employed by a Public Authority:
(a) is absent whilst on specified types of leave;
(b) is absent whilst engaged in National Service; and
(c) is absent whilst on workers compensation.
2. Where the employee employed by the Public Authority has been employed in the service of the Commonwealth or another State of Australia, employment in the service of the Commonwealth or that other State as provided in cl 16.
48 Clause 2(b) limits the ambit of ‘service’ for the purposes of the [General Order] by providing that certain matters are deemed ‘NOT’ to be included in the term ‘service’.
49 Clause 3, in general terms, provides that, subject to cl 2, the service of an employee ‘shall not be deemed to have been broken’ by three specified matters which concern, in effect, (1) where the employee has ceased employment (by resignation or termination), and (2) where his absence from employment is treated as leave by the employer. The words ‘shall not be deemed to have been broken’ indicate that without them, the matters referred to would impair continuity of service. …
153 Buss & Murphy JJ (Browne [70]) noted that ‘the deeming provisions in cl 2 are a significant and integral feature of the meaning which the [General Order] ascribes to “continuous service”.’ Their Honours conclude at Browne [75] that:
75 Accordingly, the better view, which is open on the language of reg 13(2) read with the definition of ‘continuous service’ in reg 3, is that the reference to ‘continuous’, within the meaning of the [General Order], is intended to pick up the actual period of any service which is deemed service under the [General Order], and that the words ‘served by the employee in the Public Sector’ are to be understood in that light. On that view, the words ‘for each complete year of continuous service served by the employee in the Public Sector’ are, objectively, to be read as ‘for each complete year of service served or which would be deemed to be served by the employee in the Public Sector if the Public Sector were a Public Authority and the relevant employee was an employee of a Public Authority for the purposes of the [General Order]’.
154 Therefore, it is within the following context of the General Order, that Le Miere J in Browne [119] should be understood as referring to the natural and ordinary meaning of ‘service’:
(a) Clause 1 of the General Order states that ‘all Government wages employees employed by a Public Authority shall become entitled to 13 weeks’ long service leave’ after a defined period of continuous service.
(b) The General Order does not define the phrase ‘continuous service’.
(c) Clause 2(a) of the General Order states, that for the purposes of the General Order, ‘service’ is defined to mean ‘service as an employee of a Public Authority’ and outlines nine circumstances that are deemed to be included in the meaning of ‘service’. These include eight absences. The nineth circumstance is employment in the service of the Commonwealth or another State of Australia as provided in cl 16 of the General Order, when employment in the State Government commences on or after 1 April 1974.
(d) Clause 2(b) of the General Order outlines five circumstances that are deemed not to be included in the meaning of ‘service’. The circumstances are service where the employee accrues 26 weeks of long service leave, service of less than 12 months, casual service, service prior to 1 April 1974 where the employee was a minor, and any other absence not covered in cl 2(a) of the General Order.
(e) Clause 3 of the General Order outlines three circumstances where the service of an employee is deemed not to have been broken. These include resignation where the employee is reemployed within one week by another Public Authority in the State, termination by the employer other than for misconduct where the employee is reemployed with the Government within six months, and any approved leave whether paid or unpaid.
155 Given the context of Browne as outlined at [154] above, I agree with the respondents that the Union’s contention that Browne [119] is authority for the natural and ordinary meaning of ‘service’ meaning a period of employment, renders Browne [120] nonsensical.
156 In Browne [120] (at [40] above), Le Miere J refers to cl 2 of the General Order as enlarging the natural and ordinary meaning of service, including by deeming service as an employee of a Public Authority to include periods during which the employee is not employed. His Honour provides two examples of this: cl 2(a)(v) and cl 2(a)(ix). While the cl 2(a)(ix) reference to employment in the service of the Commonwealth or another State of Australia is an example of when an employee is ‘not employed’ by the employer, the same cannot be said for the absence referred to in cl 2(a)(v). This is because it cannot be said that while the employee is absent on National Service or other military training, that the employee ‘is not employed by the employer’.
157 Therefore, I agree with the respondents that the references in Browne [119] to ‘the natural and ordinary meaning of service is a period during which an employee is employed by an employer’, and in Browne [120] to ‘the General Order enlarges the natural and ordinary meaning of service … including by deeming the service as an employee … to include periods during which the employee is not employed by the employer’, only make sense if the references to ‘employed by an employer’ and ‘employed by the employer’ refer to the performance of work. I agree with the respondents that these references would make no sense if ‘employed’ refers to the existence of an employment relationship, and if ‘service’, as the Union contends at [9(b)] above, refers to the period during which an employee is employed by the employer.
158 Peabody is a decision of the Fair Work Commission (FWC), delivered on 21 December 2020. The applicant (CFMMEU) argued that cl 29 of the transferring enterprise agreement applicable to four transferring employees upon Peabody insourcing the works of these employees from their former employer (first employer), obliged Peabody (second employer), to recognise their service with the first employer when calculating their entitlement to redundancy pay under cl 29. Peabody only recognised the employees’ employment with it, of approximately 14 months, when calculating their redundancy pay, while the employees had been employed by the first employer for various periods ranging from eight years to 21 years. Clause 29 relevantly states (emphasis added):
Where full time employees are terminated due to redundancy, they will receive payment equal to three weeks’ pay for each completed year of employment. Regardless of the length of employment, the minimum payment to an employee will be three weeks for every completed year of service.
159 In Peabody, the CFMMEU argued that the words ‘employment’ and ‘service’ in cl 29 are not interchangeable, and that the FWC should apply the ordinary meaning to those words and adopt the s 22 Fair Work Act 2009 (Cth) (FW Act) definition of ‘service’ which counts any period of service with the first employer as service with the second employer on a transfer of employment. Peabody argued that the words ‘employment’ and ‘service’ in cl 29 are interchangeable, and that the FWC should give the words their plain and ordinary meaning, and not the meaning given by s 22 of the FW Act.
160 The FWC agreed with Peabody’s contention, that the words ‘employment’ and ‘service’ in cl 29 are interchangeable, such that cl 29 does not contain an obligation for Peabody to recognise and reward the employees’ service with the first employer: Peabody [45]. In effect, the FWC agreed with Peabody that the word ‘service’ should be read as ‘employment’ such that the employees’ redundancy pay is calculated on the period of their employment with Peabody. The FWC rejected the CFMMEU’s argument that the employees’ period of service had the meaning given by s 22 of the FW Act which counts service with the first employer as service with the second employer in circumstances involving a transfer of employment.
161 The Union relies on Peabody to support its contention that ‘service’ should have the broad meaning of ‘employment’. While the FWC agreed the cl 29 reference to ‘service’ is interchangeable with ‘employment’, the FWC effectively applies an interpretation that narrows, not broadens, the meaning of ‘service’ to limit the meaning to the employees’ employment with Peabody, and to exclude their prior employment with the first employer.
162 In any event, it is apparent from Peabody [45] that the FWC is deciding the matter in the context of cl 29 which uses the terms ‘year of employment’, ‘length of employment’ and ‘year of service’ in close proximity within the one clause. The FWC is not deciding the meaning of ‘service’ in the context of a principle of general import. This is evident from the extrinsic material that the FWC took into account in reaching its conclusion, comprising of the Explanatory Memorandum for the FW Act, the letter of offer that Peabody provided to the employees, and the employees’ evidence about the settlement of their employment entitlements with the first employer.
163 Graham is a decision of the High Court delivered on 11 August 1961, involving the assessment of damages for personal injuries to an employee compulsorily retired due to such injuries. At the time of his premature retirement, the employee had received 178 days of sick leave payments, which the appellant argued should be deducted from the damages award. At first instance, and on appeal to the Supreme Court of New South Wales, the courts considered the sick leave payments received to be irrelevant to the assessment of damages because the amounts constituted sick pay and not wages. The High Court noted that: Graham [7]:
Involved in these brief observations is the notion that the performance of the services called for by a contract of employment is a condition precedent to a right to wages arising and that since the respondent did not, and was not required to, work during the relevant period the remuneration which he received could not be characterized as wages. Then, having so decided, both the learned trial judge and the Full Court were at some pains to show that the amount received could not be set off against the proved loss of wages before trial.
164 The High Court found the trial judge and the Full Court fell into error. The High Court said that while generally, the performance of services is a condition precedent to the right to wages, this is not universally true. It is correct only in cases in which, by the contract of employment, the actual doing of work is made a condition precedent to the right of wages. The High Court said (footnotes omitted) (emphasis added): Graham [8]–[9]:
8. [W]ages, in every sense of the word, may become payable according to the terms of a contract of employment even though the employee is not called upon to, and does not, in fact, render service. Perhaps, it should also be said that in the present case we are not so much concerned with the fact that an arrangement of such a character may sometimes be found as one of the incidents of a contract of service; we are concerned with a contract pursuant to which, generally speaking, the employee was bound to work for his wages. But the contract contemplates the possibility that circumstances of a defined character may arise and prevent the employee from performing his duties. In those circumstances he is to be entitled to absent himself on sick leave and, subject to specified limits, to receive ‘full pay’ whilst on leave. In our view the respondent’s contract says no more and no less than that, if he becomes unable by reason of sickness or other specified causes to perform his ordinary duties, nevertheless his right to ‘full pay’ or, in other words, his ordinary wages, shall continue to be payable, subject to the limits specified, during the period of his absence. If, therefore, the claim be made, as it was, that the respondent lost the whole of his wages between the date of the accident and the date of trial then the appellant was entitled to answer it by showing that for a period of 178 days he received his full wages.
9. The conclusion that the respondent’s socalled ‘sick pay’ constituted wages in every sense of the word is completely in accord with a long line of authority concerning the right of an employee to receive his ordinary wages in respect of a period during which he is unable, by reason of sickness or accident, to perform his duties. … This line of authority, in spite of some differences of expression on matters with which we need not concern ourselves, clearly shows that where, by virtue of an implied term of the contract of employment, ‘wages’ are payable to an employee who, by reason of illness, is absent from work, the amounts which he receives during the period of his absence are his ordinary wages and not something additional thereto or of any different character. The position is, of course, precisely the same where, as here, the matter is not left to implication and the contract of employment provides expressly for ‘sick leave on full pay’.
165 The High Court found the employee’s sick leave payments were not a reward for past services, but a right secured by the contract of service as part of the consideration for the employee’s services generally. The right was to absent himself from work on full pay in specified circumstances. The High Court allowed the appeal and remitted the matter to a new trial on the issue of damages.
166 It is evident from the passages at [163]–‍[165] above, that Graham involved the question of whether the sick leave payments received by the employee constituted his ‘wages’, such that the amounts should be deducted from the award of damages for personal injury. Graham is not authority for the contention advanced by the Union that the narrow interpretation (that ‘service’ means the performance of work) should be rejected because it excludes recognised situations (such as sick leave in Graham) where an employee may be excused from performing work but still be providing service.
167 Contrary to the Union’s contention, the High Court considered an employee absent on sick leave is not called upon to ‘render service’; which is a usage of the word ‘service’ consistent with the respondent’s position that ‘service’ means the performance of work: Graham [8]:
[W]ages, in every sense of the word, may become payable according to the terms of a contract of employment even though the employee is not called upon to, and does not, in fact, render service.
168 PTA is a decision of the Commission delivered on 21 April 2015, involving an application under s 46 of the Act, for the Commission to declare the true interpretation of various clauses of an industrial agreement. The issue for determination was whether railcar drivers were entitled to overtime for working in excess of 40 standard hours in the second week of a fortnightly cycle, after taking annual leave at 38 ordinary hours in the first week, where the agreement provided standard hours of fulltime employment in each fortnightly cycle of 80 hours. In this context, Kenner C said (emphasis added):
14 As a matter of long standing industrial principle, a period of annual leave is to be generally regarded as time worked and service performed by an employee. An employee whilst on annual leave is entitled to receive, subject to the terms of any industrial instrument applicable to their employment, the payments they would otherwise have received for ordinary working hours, had they not been on leave: The Annual Leave Cases 1971 (1972) 144 CAR 528; Re The Vehicle Industry – Repair, Services and Retail – Award 1976 (1979) 38 FLR 267; Re Engine Drivers’ Award – State (1980) AILR 314. This may extend to over award payments, shift loadings and various allowances payable for working ordinary hours. Thus the annual leave benefit, whether conferred by industrial instrument or statutory provision, relieves an employee from the obligation to attend at work, whilst receiving remuneration for an ordinary week’s work (see too s 18(1) MCE Act).
15 In my view, this principle assists in answering the central proposition thrown up by this matter. Whilst a railcar driver is on annual leave for one week of a fortnightly cycle, they are still, for the purposes of the Agreement, regarded as being ‘at work’. Their service, for award or benefit purposes, is continuous. However, as they are not actually required to work 40 hours, as part of the standard hours of work for the purposes of cl 3.1.2 of the Agreement, they do not accumulate two hours towards credit days. A railcar driver whilst on leave is paid his or her ordinary hours for a week as prescribed in cl 3.1.1 which is 38 hours pay.
16 It follows from this, that when a railcar driver returns to work in the second week of a fortnightly work cycle, the Authority, consistent with its rights under cl 3.1.2, is able to roster the driver such that the standard hours are met over the fortnightly period, of 80 hours. This means, having ‘worked’ 38 hours in the first week while on annual leave, the Authority may roster a driver for up to 42 hours in the second week, to meet the standard hours requirement in cl 3.1.2, prior to overtime hours becoming payable. The approach to construction adopted by the Union in effect means, that when a driver takes a period of leave in a fortnightly cycle, then their standard hours revert to only 78 for that fortnightly period. In my view, that is not consistent with the scheme of hours of work as contemplated by the relevant clauses in the Agreement.
17 In my view, the approach I have adopted in this matter is consistent with the terms of the Agreement, considered as a whole. It is consistent with the dual concepts of ‘ordinary hours’ and ‘standard hours’ in cls 3.1.1 and 3.1.2 of the Agreement, and preserves the integrity of both. It is an approach that does not involve any absurdity or repugnancy with the terms of the Agreement as a whole. The Agreement provides for 38 hours to be an ordinary working week, but also provides for 80 hours in a fortnight to be worked prior to the payment of overtime, to account for the accumulation of credit days. The interpretation adopted in this matter is consistent with these two concepts.
169 The Union relies on PTA in support of its contention that a ‘year of service’ in s 23(1) of the MCE Act should be understood as ‘year of employment’ because PTA is authority for the contention that an employee on annual leave is excused from performing work but is still considered as giving service.
170 Kenner C states the following in PTA [14]:
(a) It is a matter of long standing industrial principle that a period of annual leave is to be regarded as time worked and service performed by an employee.
(b) An employee on annual leave is entitled to be paid the amounts they would otherwise have received for ordinary working hours, inclusive of any loadings and allowances they would have received for working ordinary hours.
(c) ‘Thus the annual leave benefit, whether conferred by industrial instrument or statutory provision, relieves an employee from the obligation to attend at work, whilst receiving remuneration for an ordinary week’s work’.
171 It is apparent by Kenner C’s use of the word ‘thus’, that the statement at [170(c)] above, is the result of the matters outlined in [170(a)–‍(b)] above. Namely that an employee on paid annual leave is not required to attend at work ([170(c)]), in order to receive the pay they would ordinarily receive for working their ordinary hours of work ([170(b)]), because the time they are on paid annual leave is ‘regarded as time worked and service performed’ ([170(a)]).
172 Kenner C’s comments should be understood as being made in the context of determining the issue that arose in PTA, namely to determine whether an employee on paid annual leave should be considered to be working their ordinary hours or their standard hours under the industrial agreement, for the purposes of the fortnightly roster and the entitlement to overtime pay for working in excess of the 80 standard hours of work in a fortnight. This is reinforced in PTA [15], where Kenner C states that a railcar driver on annual leave is not required to work their 40 standard hours a week but is regarded as being at work and providing continuous service and therefore entitled to payment for 38 ordinary hours of work.
173 It is evident from [170]–[172] above, that PTA does not support the Union’s contention at [169] above. Furthermore, Kenner C said that ‘a period of annual leave is to be generally regarded as time worked and service performed by an employee’. This is a usage of the word ‘service’ as synonymous with ‘time worked’.
174 The Union relies upon Bambach, Hall, Rankin and Touhey as supporting its contention that workers’ compensation absences are not ‘unpaid leave’, and therefore should not be excluded from the accrual of annual leave under s 23(1) of the MCE Act. However, these cases do not support the Union’s contention for the following reasons.
175 Bambach is a decision of the FWCFB delivered on 31 May 2012, involving an appeal of an FWC decision that Mr Bambach is a person protected from unfair dismissal within the terms of s 382 of the FW Act for having completed a period of employment of at least the minimum employment period (of six months). Mr Bambach was employed as a casual from 7 March 2010 to 25 September 2011. On 1 June 2010, Mr Bambach was injured at work. Consequently, WorkPac argued that Mr Bambach’s period of employment is only the preinjury period of twoandaahal HALD j f half months, as the period he was receiving workers’ compensation is not a ‘period of service as a casual employee’ under s 384(2)(a) of the FW Act. Sections 384(1) and 384(2)(a) of the FW Act relevantly state (emphasis added):
384 Period of employment
(1) An employee’s period of employment with an employer at a particular time is the period of continuous service the employee has completed with the employer at that time as an employee.
(2) However:
(a) a period of service as a casual employee does not count towards the employee’s period of employment unless:
(i) the employment as a casual employee was on a regular and systematic basis; and
(ii) during the period of service as a casual employee, the employee had a reasonable expectation of continuing employment by the employer on a regular and systematic basis; and
176 Section 22 of the FW Act defines ‘service’ and ‘continuous service’ relevantly as:
22 Meanings of service and continuous service
General meaning
(1) A period of service by a national system employee with his or her national system employer is a period during which the employee is employed by the employer, but does not include any period (an excluded period) that does not count as service because of subsection (2).
(2) The following periods do not count as service:
(a) any period of unauthorised absence;
(b) any period of unpaid leave or unpaid authorised absence, other than:
(i) a period of absence under Division 8 of Part 2-2 (which deals with community service leave); or
(ii) a period of stand down under Part 3-5, under an enterprise agreement that applies to the employee, or under the employee’s contract of employment; or
(iii) a period of leave or absence of a kind prescribed by the regulations;
(c) any other period of a kind prescribed by the regulations.
(3) An excluded period does not break a national system employee’s continuous service with his or her national system employer, but does not count towards the length of the employee’s continuous service.
(3A) Regulations made for the purposes of paragraph (2)(c) may prescribe different kinds of periods for the purposes of different provisions of this Act (other than provisions to which subsection (4) applies). If they do so, subsection (3) applies accordingly.
(4) For the purposes of Divisions 4 and 5, and Subdivision A of Division 11, of Part 2-2:
(a) a period of service by a national system employee with his or her national system employer is a period during which the employee is employed by the employer, but does not include:
(i) any period of unauthorised absence; or
(ii) any other period of a kind prescribed by the regulations; and
(b) a period referred to in subparagraph (a)(i) or (ii) does not break a national system employee’s continuous service with his or her national system employer, but does not count towards the length of the employee’s continuous service; and
(c) subsections (1), (2) and (3) do not apply.
177 WorkPac argued that an absence on workers’ compensation is an ‘excluded period’ because the absence is an ‘unpaid authorised absence’ within the meaning of s 22(2)(b) of the FW Act. The FWCFB said:
[31] At issue in these proceedings is the proper construction of the expression ‘unpaid authorised absence’ in s 22(2)(b). The starting point is to construe these words according to their ordinary meaning, having regard to their context and purpose. ‘Absence’ in this context means absence from work. The Oxford Dictionary defines ‘authorised’ to mean, among other things, ‘legally or formally sanctioned’. An absence due to work related injury may be regarded as being legally sanctioned.
[32] The word ‘unpaid’ presents an insurmountable problem for the appellant in this case. The period during which [Mr Bambach] was absent due to his work related injury was not ‘unpaid’. During the relevant period Mr Bambach received compensation payments in accordance with the provisions of the Workers’ Compensation Act 1987 (NSW) (the Workers’ Compensation Act). Those payments were made pursuant to a legal obligation upon Mr Bambach’s employer, WorkPac. Section 9(1) of the Workers’ Compensation Act provides:
A worker who has received an injury ... shall receive compensation from the worker’s employer in accordance with this Act [original emphasis]
178 In rejecting a contention that ‘paid’ in the context of the FW Act refers to the work/wages bargain, the FWCFB said:
[47] Further, the Act does not adopt a consistent approach in relation to what constitutes ‘service’ for the purpose of accruing statutory entitlements. There are numerous circumstances where employees accrue entitlements to paid leave when they are engaged in activities which are entirely unrelated to the performance of work for their employer. In particular, the Act provides that an employee’s leave entitlements continue to accrue when the employee is:
· absent from work and engaged in an ‘eligible community service activity’ (s 22(2)(b)(i) and s 108);
· absent from work for a period because of jury service (s 22(2)(b)(i) and s 111); and
· ‘stood down’ because they cannot be usefully employed (s 22(2)(b)(ii) and s 524).
[48] Nor is there any consistency in relation to what constitutes service for the purpose of accruing statutory entitlements. On the one hand ‘unpaid leave and unpaid authorised absences’ do not count as ‘service’ for the purpose of calculating an employee’s entitlement to annual leave, personal carer’s leave or redundancy pay. But this is to be contrasted with the fact that ‘unpaid leave and unpaid authorised absences’ do count as ‘service’ for the following purposes:
· calculating the 12 months’ continuous service required before an employee can request a change of working arrangements pursuant to s 65;
· calculating the 12 months’ continuous service required before an employee is entitled to parental leave pursuant to s 67; and
· calculating the notice of termination required to be given to the employee pursuant to s 117.
179 The FWCFB concluded that an absence on workers’ compensation is not an ‘excluded period’ within the meaning of s 22 of the FW Act. However, it is evident from the passages at [177]–‍‍[178] above, that the issue to be determined in Bambach is the proper interpretation of the expression ‘unpaid authorised absence’ and not ‘unpaid leave’. Further, within the expression ‘unpaid authorised absence’, the FWCFB considered the meaning of ‘unpaid’ in the context of the FW Act’s approach to what constitutes ‘service’ for accruing statutory entitlements, including provisions of the FW Act where ‘service’ is related to the performance of work and provisions of the FW Act where ‘service’ is unrelated to the performance of work. The FWCFB also considered provisions of the FW Act where an unpaid authorised absence counts as ‘service’ and provisions of the FW Act where an unpaid authorised absence does not count as ‘service’. These are features specific to the FW Act. They are not features of the MCE Act.
180 Hall is a decision of the Federal Circuit Court of Australia (FCC), delivered on 17 February 2015, in which the issue for determination is whether Mr Hall is entitled to accrue annual leave under s 87 of the FW Act during a period on workers’ compensation under the Workers’ Compensation and Rehabilitation Act 2003 (Qld) (WCRA), where s 119A of the WCRA states:
119A Compensation entitlement does not restrict taking or accrual of leave
(1) This section applies to a worker who is entitled to compensation, including compensation payable as weekly payments.
(2) The worker is entitled to take or accrue annual leave, sick leave and long service leave under an Industrial Act or industrial instrument during the period to which the compensation applies.
Note – In relation to entitlements under the Fair Work Act 2009 (Cwlth), this section removes the restriction under section 130(1) of that Act.
181 The FCC noted that s 87 of the FW Act states that annual leave accrues with ‘service’, which is term that is defined in s 22 of the FW Act. The FCC said (Hall [33]):
The respondent points out that annual leave is something which accrues as a consequence of the performance of work or the performance of service and not by the fact of the employment relationship alone. In that respect the respondent’s argument is plainly correct. Annual leave accrues by reason of service: s 87(1) of the [FW Act]. It accrues incrementally over the course of a year of service: s 87(2) of the [FW Act]. Other types of leave, unpaid carer’s leave (s 102 of the [FW Act]) and community service leave (s 108 of the [FW Act]) for example, do not accrue by reason of service.
182 The FCC found that Mr Hall’s entitlement to accrue annual leave arises under the Health Professionals and Support Services Award 2010 for the purposes of s 119A(2) of the WCRA, because the award incorporates s 87 of the FW Act by its reference to the National Employment Standards. There is no equivalent of s 119A(2) of the WCRA in the WCIM Act. There is also no equivalent of s 22 of the FW Act in the MCE Act. Accordingly, I do not consider that Hall is of assistance to the Union.
183 Rankin is a decision of the Queensland Industrial Relations Commission (QIRC) delivered on 10 February 2021, in which the issue for determination is whether Ms Rankin is entitled to accrue annual leave and sick leave under the Industrial Relations Act 2016 (Qld) (IRA) whilst receiving workers’ compensation payments under the WCRA.
184 Sections 31(1), 32 and 40 of the IRA state (emphasis added):
31 Entitlement
(1) For each completed year of employment with an employer, an employee is entitled to–
(a) if the employee is not a shift worker–at least 4 weeks annual leave; or
(b) if the employee is a shift worker–at least 5 weeks annual leave.
32 Working out a completed year of employment
(1) This section applies for working out a completed year of employment for section 31.
(2) The following periods when an employee is absent without pay are not to be taken into account –
(a) a period of more than 3 months when an employer is absent with the employer’s approval;
(b) a period when an employee is absent without the employer’s approval, unless the employee is absent for not more than 3 months because of illness of injury that is certified by a doctor.
40 Entitlement to sick leave
(1) An employee is entitled to at least 10 days sick leave on full pay for each completed year of employment with an employer.
185 The QIRC noted that the IRA did not define ‘pay’; nor does the Acts Interpretation Act 1954 (Qld). Referring to the Macquarie Dictionary definition of ‘pay’ as including to ‘give compensation for’, the QIRC found that workers’ compensation payments constitute ‘pay’.
186 The QIRC found that while Ms Rankin is not receiving salary or wages during the time she is receiving workers’ compensation payments, she is receiving ‘pay’ in the form of compensation. The QIRC found that this meant Ms Rankin is not ‘absent without pay’ for the purposes of s 32(2) of the IRA, and therefore met the ‘completed year of employment’ required to be entitled to annual leave under s 31 of the IRA.
187 In relation to sick leave under s 40 of the IRA, the QIRC noted that, unlike ss 31 and 32, s 40 is not accompanied by a section to work out what a ‘completed year of employment’ is. Therefore, the QIRC found that for the purposes of s 40, ‘completed year of employment’ should be given its ordinary meaning. This meant that as Ms Rankin continued to be employed by the respondent, there was no break in her employment, and therefore, the time receiving workers’ compensation payments contributes to a ‘completed year of employment’.
188 It is evident from the passages at [184]–‍[187] above, that Rankin involved the determination of the term ‘absent without pay’ in the context of the IRA which provided for an entitlement to annual leave and sick leave ‘for each completed year of employment’. This is not the case under the MCE Act which provides for an entitlement to paid annual leave (and paid personal leave) ‘for each year of service’ and provides that the meaning of ‘year’ does not include any period of ‘unpaid leave’. Accordingly, I do not consider that Rankin is of assistance to the Union.
189 Touhey is a decision of the FCA delivered on 4 February 2022, in which the issue for determination is whether Mr Touhey is receiving compensation under a ‘compensation law’ for the purposes of s 130(1) of the FW Act, and if so, whether annual leave accruals are ‘permitted’ for the purposes of s 130(2) of the FW Act. Section 130 of the FW Act states:
130 Restriction on taking or accruing leave of absence while receiving workers’ compensation
(1) An employee is not entitled to take or accrue any leave or absence (whether paid or unpaid) under this Part during a period (a compensation period) when the employee is absent from work because of a personal illness, or a personal injury, for which the employee is receiving compensation payable under a law (a compensation law) of the Commonwealth, a State or a Territory that is about workers’ compensation.
(2) Subsection (1) does not prevent an employee from taking or accruing leave during a compensation period if the taking or accruing of the leave is permitted by a compensation law.
(3) Subsection (1) does not prevent an employee from taking unpaid parental leave during a compensation period.
190 The FCA noted that Mr Touhey was receiving compensation under the WCIM Act. The FCA found that the WCIM Act is a ‘compensation law’ for the purposes of s 130(1) of the FW Act. Therefore, the FCA found that the period which Mr Touhey was absent from work receiving workers’ compensation under the WCIM Act is a ‘compensation period’ within the meaning of s 130(1) of the FW Act.
191 The FCA noted s 80(1) of the WCIM Act states:
Compensation is payable in accordance with this Act to a worker in respect of any period of incapacity notwithstanding that the worker has received or is entitled to receive in respect of such period any payment, allowance, or benefit for annual leave or long service leave under any Act of the Commonwealth or of the State, any industrial award under any such Act, or any other industrial agreement applicable to his employment, and the amount of compensation so payable shall be the amount which would have been payable to the worker had he not received or been entitled to receive in respect of such period any such payment, allowance, or benefit.
192 Following and applying Anglican Care v NSW Nurses and Midwives’ Association [2015] FCAFC 81, the FCA found that s 80(1) of the WCIM Act ‘sanctioned, condoned or countenanced’ and thus ‘permitted’ the dual receipt of compensation and annual leave benefits to Mr Touhey for the purposes of s 130(2) of the FW Act. Therefore, the FCA found that Mr Touhey is entitled to accrue annual leave under the FW Act during the period he is absent from work and receiving workers’ compensation payments.
193 However, I do not consider that Touhey assists the Union for the following reasons. At Touhey [56], the FCA said that s 80(1) of the WCIM Act ‘does not expressly provide or confer any entitlement to take or accrue annual leave’. The source of the entitlement to accrue annual leave therefore arises elsewhere, and in Touhey, this is the FW Act. As Touhey involves the interaction of the WCIM Act with the FW Act, Touhey consequently makes no mention of whether an entitlement to accrue annual leave during a period of workers’ compensation arises under the MCE Act.
194 I am not persuaded that Browne, Peabody, Graham, PTA, Bambach, Hall, Rankin and Touhey support the Union’s contentions. Notably, these cases do not support the Union’s contentions that ‘year of service’ in s 23(1) of the MCE Act should mean a period during which an employee is employed. Similarly, these cases do not support the Union’s contention that Jones is wrong and should not be followed.
195 In the circumstances, the Union has not convinced me that the ordinary meaning of ‘service’, as requiring the performance of duties, as outlined in Jones and in UWU [34] referencing Browne [119], is wrong and should not be followed.
196 Given this, I am not convinced by the Union’s arguments at [62]–[63] above, regarding cl 45.1(a) (at [5] above) of the Agreement. I also remain unconvinced that the Union has established that ‘year of service’ in s 23(1) of the MCE Act (at [11] above), read together with s 23(3), has a meaning synonymous with employment and includes a period during which an employee is absent from work and receiving workers’ compensation payments.
197 Despite the Union’s contentions at [16]–[17] above, I am also not persuaded that the Union’s purported beneficial and remedial purpose of s 23(1) of the MCE Act requires a contrary finding. Furthermore, s 9A of the MCE Act addresses the meaning of authorised leave for the purposes of the prohibition from requiring or requesting an employee to work more than their maximum hours of work; it does not address the meaning of year of service for the purposes of accruing annual leave.
198 As outlined in [4(b)] above, the parties agreed that the revised declaration could be validly made if I agreed with the Union’s case. However, for the preceding reasons, I do not agree with the Union’s case, and therefore decline to make the declaration.
199 In the circumstances, it becomes unnecessary to consider the parties’ submissions regarding Minister for Corrective Services and the analysis therein regarding the Commission’s power to declare the true meaning of a term implied by the MCE Act.
Conclusion
200 The parties submitted that the declaration at [4(b)] above could be validly made if I agreed with the Union’s case.
201 For the preceding reasons, I do not agree with the Union’s case, and therefore decline to make the declaration.
202 Accordingly, application APPL 71 of 2023 will be dismissed.