DECISION

Fair Work Act 2009
s.604—Appeal of decision

Flight Attendants' Association of Australia
v
Qantas Airways Limited
QF Cabin Crew Australia Pty Ltd
(C2019/547)

Appeal against decision of Deputy President Sams delivered at Sydney on 3 January 2019 in matter number C2018/7265.

Introduction and factual background

[1] The Flight Attendants’ Association of Australia (FAAA) seeks permission to appeal and appeals a decision of Deputy President Sams delivered on transcript on 3 January 2019 (Decision). The Decision was made pursuant to s 739 of the Fair Work Act (FW Act) and the dispute resolution procedure in the Qantas Airways Limited and QF Cabin Crew Pty Ltd Enterprise Agreement 2017 (Agreement or EBA 10 1). The subject matter of the dispute before the Deputy President concerned the allocation of flight duties to cabin crew on international flights undertaken by Qantas Airways Limited (Qantas).

[2] Some description of the factual context is necessary in order to describe the precise issue which the Deputy President was called on to resolve. There are two entities involved in the employment of cabin crew on Qantas international flights. Flight attendants engaged before December 2007 are employed by Qantas while those engaged from December 2007 onwards are engaged by QF Cabin Crew Australia Pty Ltd (QCCA), a Qantas subsidiary. The approximately 1,900 flight attendants employed by Qantas work on “mainline” operations, consisting of flights using B747-400 and A330 aircraft, while the approximately 500 QCCA flight attendants are used to supplement mainline flying crews and also crew flights using A380 and B787 aircraft.

[3] The Agreement covers flight attendants employed by both entities, and is structured so that Part A contains provisions which are generally applicable to all flight attendants, Part 1 covers Qantas employees only, and Part 2 covers QCCA employees (as well as “Transfer Employees”, who are Qantas employees who have applied for and been granted permission to transfer to the A380 or B787 fleet under Part 2 conditions for a period of at least 2 years). Part 1 preserves to a significant degree the “legacy” conditions of employment of Qantas employees, while the conditions of employment for QCCA employees under Part 2 are less beneficial to the employees in a number of respects to those in Part 1.

[4] One way in which Part 1 and Part 2 conditions are distinct concerns the methods for allocating flying duties to flight attendants. Qantas rosters its flight attendants in 56-day blocks known as “bid periods”. In general terms, Part 1 of the Agreement provides for a system by which Qantas constructs duty patterns for a particular bid period, which are known as “bid lines”, and then flight attendants employed by Qantas may “bid” for their preferred bid lines on mainline operations during an upcoming roster period and are allocated preferred flights in order of seniority. Under Part 2, QCCA flight attendants may indicate their preference for flight patterns but flights are allocated at Qantas/QCCA’s absolute discretion.

[5] The dispute before the Deputy President concerned the allocation of flight duties for bid period 327 commencing on 7 January 2019. In the construction of the roster for this period, Qantas did not allocate flight duties to Qantas flight attendants strictly in accordance with seniority, but rather for reasons of operational convenience “unlocked” the roster so that in one or more cases a QCCA flight attendant was allocated a flight pattern for which a Qantas flight attendant had expressed a preference. The issue was first raised by the FAAA in an email dated 19 December 2018 after Qantas had sent the FAAA the “roster runs” for bid period 327. The FAAA did not receive a satisfactory response and so escalated the dispute to a higher level of Qantas management by email correspondence dated 20 December 2018 in accordance with the disputes procedure in the Agreement. The matter was not resolved, and the dispute was notified to the Commission on 21 December 2018.

[6] The Deputy President conducted a conference in relation to the dispute on 22 December 2018. Because the dispute was unable to be settled, the Deputy President then listed the matter for an urgent hearing on 2 January 2019, and directions were made requiring the parties to file evidence and submissions by 31 December 2018. The parties were unable to agree on the formulation of a single question to be answered by the Deputy President. The FAAA’s proposed question was as follows:

“When Qantas allocates known flying of A330 and B747 to employees covered by the EBA 10, is Qantas prevented from allocating a trip to a QFCC crew member, which a Qantas crew member has already been allocated in the process?”

[7] Qantas’s proposed question was:

“When Qantas allocates known flying of A330 and B747 aircraft to employees covered by EBA 10 and has determined it is necessary to ‘unlock’ rosters to cover known flying, is Qantas prevented from allocating a QCCA flying line holder a pattern which a Qantas flying line holder has expressed a preference for and has been provisionally awarded during the seniority run?”

[8] After the completion of the hearing on 2 January 2019, the Deputy President informed the parties that he would issue his decision the following day and, as earlier stated, the Decision was in fact delivered on 3 January 2019.

Relevant provisions of the Agreement

Part A

[9] We have earlier outlined the broad structure of the Agreement. Clause 4 of Part A of the Agreement relevantly explains that structure in greater detail as follows:

Part 1 of this Agreement will apply to Qantas employees (except a Transfer Employee) and have no application to QCCA employees or Transfer Employees. Cabin crew engaged by QCCA will be covered by Part 2 of this Agreement. Part A of this Agreement applies to both Qantas and QCCA and the employees of each company. For the purposes of Part A only of this Agreement, "Company" shall mean either Qantas or QCCA.

[10] Clause 4 of Part A also provides that the Agreement “consolidates and completely supersedes” a series of previous agreements set out in a list which goes all the way back to Qantas Airways Limited Enterprise Agreement I (1992-1994). It also provides that the terms of the Agreement operate to the full exclusion of all awards that would otherwise be applicable including the Airline Operations – Flight Attendants’ Long Haul (Qantas Airways Limited) Award 2002.

[11] Clause 6, Determination of Flying of Part A relevantly provides:

Known flying on the B747 and A330 fleets to be undertaken by crew employed under this Agreement (EBA 10), will be pooled and then patterned according to the rules contained in Part 1 of this Agreement. This pool of flying patterned under Part 1 will include all crew positions on one flight per day on the Australia London route as long as an aircraft on which Part 1 cabin crew are endorsed to operate (other than the A380 and B787) is scheduled to operate on this route.

All Part 1 employees (other than Part 1 crew allocated to the A380 or B787) employed by Qantas as cabin crew on or before 17 December 2007 must be given priority in bidding for and be allocated flying from this pool, in accordance with clause 26 ALLOCATION OF DUTIES of Part 1.

Flying on the B747 and A330 fleets not allocated to Part 1 employees in accordance with the provision of this clause may then be allocated to employees employed under Part 2 of this Agreement.

Known flying on the A380 and B787 fleets to be undertaken by crew employed under this Agreement (EBA 10) will be pooled and then patterned according to the rules contained in Part 2 of this Agreement.

. . .

[12] The dispute resolution procedure is contained in clause 9 of Part A of the Agreement. In respect of the role of the Commission in dealing with disputes which cannot be settled at the workplace level, clause 9 relevantly provides:

9.4 If a dispute is referred to the Commission for resolution, the Commission can take any or all of the following actions as it considers appropriate to resolve the dispute:

9.4.1 convene conciliation conferences of the parties or their representatives at which the Commission is present;

9.4.2 require the parties or their representatives to confer among themselves at conferences at which the Commission is not present;

9.4.3 request, but not compel, a person to attend proceedings;

9.4.4 request, but not compel, a person to produce documents;

9.4.5 where either party requests, make recommendations about particular aspects of a matter about which they are unable to reach agreement;

9.4.6 where the matter, or matters, in dispute cannot be resolved (including by conciliation) and one party or both request, arbitrate or otherwise determine the matter, or matters, in dispute.

9.5 The Commission must follow due process and allow each party a fair and adequate opportunity to present their case.

9.6 Any determination by the Commission under paragraph 9.4.6 must be in writing if either party so requests, and must give reasons for the determination.

9.7 Any determination made by the Commission under paragraph 9.4.6 must be consistent with applicable law and must not require a party to act in contravention of an applicable industrial instrument or law. Where relevant, and circumstances warrant, the Commission can consider previous decisions of the Commission.

9.8 The Commission must approach matters regarding management decisions in accordance with the general principles set out in the XPT case [(1984) 295 CAR 188].

9.9 The Commission must not issue interim orders, 'status quo' orders or interim determinations.

9.10 The parties are entitled to be represented including by legal representatives, in proceedings pursuant to this dispute resolution procedure.

Part 1 provisions

[13] The preamble to Part 1 provides:

The clauses contained in Part 1 of this Agreement apply to all employees of Qantas Airways Limited (Qantas) who are performing work patterned under Part 1 in accordance with clause 6 - DETERMINATION OF FLYING of Part A of this Agreement. Part 1 of this Agreement shall have no application to employees of QF Cabin Crew Australia Pty Limited (QCCA) or Transfer Employees.

[14] Clause 25, Construction of Bid Lines, of Part 1 relevantly provides:

25. CONSTRUCTION OF BID LINES

25.1 Length of bid period

Bid periods are 56 days duration; … 2

25.2 Flying lines and reserve lines

Bid lines must be constructed as flying lines and reserve lines. Bid lines must be constructed at each base for all employees who are eligible to hold a bid line.

25.3 Determination of flying line requirements

25.3.1 The Company must determine the number of flying lines for each category at each base in a bid period. The number of flying lines will be maximised, subject to known flying to ensure adequate reserve line coverage consistent with clause 26.4.

25.3.2 The Company must determine the number of part-time flying lines at each base in a bid period. For resource planning purposes, forecast part-time employee known flying lines must be planned to operate at the part-time divisor.

25.3.3 Representative flying may be withdrawn from known flying in a bid period and assigned or allocated to employees for coach flying as required by the Company prior to the determination of flying line requirements as specified in subclause 25.3.1 above provided that no more than 2% of employees may be identified to receive coach flying in any single bid period.

25.4 Divisor

The full-time divisor must be within the range of 186 to 193 duty hour credits and may be varied, by hourly increments, within this range, for any or all categories at the Company's discretion. The divisor for part-time cabin crew is always 100 duty hour credits for 50% part time cabin crew and is always 139 for 75% part time crew members.

. . .

25.6 Flying lines to be constructed within range

25.6.1 All flying lines must be constructed in the range from the Company minimum hours to the Company maximum hours as applicable to the nominated divisor.

25.6.2 The Company must endeavour to construct part-time flying lines in the range from the part-time Company minimum hours to the part-time Company maximum hours.

25.6.3 The Company may ignore a preference(s) in reverse order of expressed preference(s) to construct all flying lines within the range prescribed in this subclause.

. . .

25.8 Consultation

Following consultation with the Association, reasonable special arrangements for the construction of bid lines may be implemented to meet unforeseen operational circumstances not accommodated by this Agreement.

[15] A number of the expressions used in clause 25 (and elsewhere in Part 1) are defined in clause 4 of Part 1. “The Company” is defined to mean Qantas, and an “Employee” is a person employed under a classification in Part 1, but does not include a Transfer Employee. “Known flying” is defined in clause 4.37 to mean “all flying for which the date and time of departure and return are known and from which a pattern(s) can be constructed”. A “flying line” is defined in clause 4.33 as a bid line which includes a “…planned sequences of patterns…”, with a “pattern” being defined in clause 4.4.4 as “a flight duty period, or sequence of flight duty periods with intervening rest periods, commencing and completing at the employee's base”. By contrast, a “reserve line” (defined in clause 4.51) does not include patterns and primarily consists of ground duties. “Representative flying” (defined in clause 4.50) is the flying which a “coach” could reasonably have expected to achieve through bidding based on his or her seniority; “coach flying” (defined in clause 4.14) is instruction, coaching or training provided to an employee whilst operating an aircraft in order to improve performance. “Category” refers to an employee’s classification (clause 4.13).

[16] The expressions “Company minimum hours” and “Company maximum hours” are defined in clauses 4.17 and 4.18 of Part 1 respectively as follows:

4.17 Company maximum hours means 193 duty hour credits for each 56-day bid period when the divisor is 186. For each hour the divisor is above 186, the Company maximum hours is also increased by one hour, to a maximum of 199 duty hour credits. An exception applies for part-time employees, where the Company maximum hours are always 106.

4.18 Company minimum hours means 181.3 duty hour credits for each 56-day bid period when the divisor is 186. For each hour the divisor is above 186, the Company minimum hours is also increased by one hour, to a maximum of 188.3 duty hour credits. An exception applies for part-time employees, where the Company minimum hours are always 95 for 50% part time and 139 for 75% part time.

[17] Clause 26, Allocation of Duties, sets out in detail the mechanism by which flight attendants employed by Qantas may bid for and be allocated flying lines and reserve lines in accordance with their preferences. First, clause 26.1 establishes the entitlement to bid for flying lines and reserve lines in the following terms:

26.1 Submission of bid or preferences

An employee allocated to a category and base who will be qualified and available in that category and base on or before the first day of a bid period, is eligible to hold a flying or reserve line and may submit preferences in that category at that base prior to the closing date of bids for that bid period. A written specific bid is acceptable in the circumstances agreed between the Association and the Company from time to time.

[18] Clause 26.2 permits Qantas to determine whether a flight attendant is to be designated as a reserve line holder or flying line holder. This designation is provisional at the time bids are invited and is made definitive at the close of bidding. Clauses 26.3 and 26.4 set out procedures applicable to the designation of flying line holders and reserve line holders respectively. Significantly, clause 26.4 also establishes a specific preferential system for the allocation of reserve lines, and for that purpose clause 26.4.1 expressly provides: “... Part 1 and Part 2 employees (except for those operating on the A380 or B787), will be treated as one group”. Clause 26.5 concerns the circumstances of flight attendants returning from parental leave.

[19] Much of the focus of the Decision and this appeal was upon clause 26.6 which provides for the allocation of preferences in response to bids submitted pursuant to clause 26.1 as follows:

26.6 Allocation of preferences

The Company must allocate preferences to employees in order of seniority of those who have submitted a bid.

26.6.1 The number of reserve lines awarded in a category in a bid period must not exceed the number of reserve lines required in that category in that bid period.

26.6.2 Where an employee submits a bid for reserve or for flying line holder preferences, the bid for reserve must take priority unless that employee has been identified by the Company for coach flying or in accordance with clause 26.4.2.

26.6.3 A flying line holder's preferences must be satisfied, where possible, in the order indicated in the bid. Where a particular preference cannot be satisfied the Company must attempt to satisfy the flying line holders next expressed preference.

26.6.4 An employee eligible to bid and who fails to submit a sufficient number of preferences is deemed to have no further preferences and must be awarded any duty that has not otherwise been awarded.

26.6.5 An employee eligible to bid and who fails to submit a bid is deemed to have no preference(s) and must be awarded any duty that has not otherwise been awarded.

[20] Clause 26.7 concerns flight attendants who are required to perform coach flying in a bid period. In summary, clause 26.7 provides that such flight attendants are to be notified of their coach flying patterns before the opening of bids for a bid period. Such coach flying patterns are not to exceed 140 duty hour credits in a bid period, and a flight attendant may submit bids for the remainder of the bid period.

[21] Clauses 26.8 and 26.9 concern the allocation of flights to flight attendants who are “language speakers” – that is, who speak a foreign language – on flights where such language use is required. Of relevance for present purpose are clauses 26.8.1, 26.8.2, 26.8.3 and 26.9.1, which provide:

26.8.1 The Company may assign QCCA employees to language patterns to ensure any vacant language slots are filled, after the awarding of Qantas language speaker flying line holder bids but prior to assigning Qantas language speaker flying line holders language trips.

26.8.2 The pattern preferences of a priority one language speaker flying line holder may be overridden by the Company or the Company may override the preference of the most junior flying line holder who would otherwise have been awarded such pattern(s) such that his/her flying line in each bid period contains up to 110 duty hour credits or a full language line as per clause 26.9 or in accordance with 7.4.

26.8.3 The pattern preferences of a priority two language speaker flying line holder may be overridden by the Company or the Company may override the preference of the most junior flying line holder who would otherwise have been awarded such pattern(s) such that his/her flying line in each bid period contains up to 55 duty hour credits appropriate to his/her language qualifications.

. . .

26.9.1 The bidding preferences of all Hindi, Mandarin and Cantonese speakers and, other language speakers as discussed, recruited from 22 December 2004 may be overridden by the Company to ensure that their flying lines in each bid period contain a full designated language allocation or in accordance with clause 7.4.

[22] Clause 26.10, 26.11 and 26.12 establish further requirements concerning the allocation of duties in response to bids. Of relevance are the following provisions:

26.10 Qualified and available in category

26.10.1 A flying line must not be awarded to an employee who is not allocated to the category and base for which that flying line is constructed nor to an employee undergoing promotional training, unless there is reasonable expectation on the part of the Company that the employee will be qualified and available in that category and base on or before the first day of the bid period.

. . .

26.12 Duties allocated with regard to preferences

Duties must be allocated having regard to preferences expressed in the employee's bid and subject to any limitation contained in this clause.

Part 2 provisions

[23] Clause 1 of Part 2 of the Agreement provides that it applies to all employees of QCCA covered by the Agreement and to any Transfer Employees. Clause 9.2 provides that employees covered by Part 2 will have planned duty hours of up to 240 hours per 56-day roster period (the expression “bid period” is not used in Part 2). Clause 13 concerns the allocation of work to Part 2 employees, and relevantly provides:

13. ALLOCATION OF WORK

13.1 Employees will be allocated rosters on a fair share basis. The Company will consult the Association on the fair share parameters prior to the introduction of a new IT system.

13.2 Employees will be assigned a roster which may comprise of flying patterns, reserve and/or available spans (AV span) (or ground duties or leave days in accordance with this Agreement)

. . .

13.5 Employees must fly each pattern he/she is allocated unless they are removed from the pattern by Qantas/QCCA or with the approval of Qantas/QCCA.

. . .

13.7 Qantas/QCCA will implement a system by no later than December 2017 which allows employees to express roster preferences. Employees will be provided with information on the preference options and parameters. The P&S Scheduling Committee may review the parameters. Employees are not guaranteed their preferences in roster construction and awarding of preferences will be subject to operational requirements and at Qantas/QCCA's absolute discretion.

13.8 Exchange of rostered duties

Flight attendants may exchange duties and days off between themselves with the agreement of the Company or Qantas. Provided:

a) there is no reduction in operational coverage;

b) there is no additional cost to the Company or Qantas; and

13.8.1 In accordance with 13.8 (a) and (b) and subject to the approval of Qantas, flight attendants operating on the B747 and A330 fleets may exchange duties with flight attendants employed by Qantas operating on the B747 and A330 fleets.

The Decision

[24] In his Decision, the Deputy President noted the differing questions proposed for resolution by the parties, but identified the question to be resolved by him as simply being: “whether in preparing roster BP327 did Qantas comply with its obligations under EBA 10?”. 3 The Deputy President’s reasoning and conclusion with respect to this question and the parties’ questions was as follows:

“In my view the answer to these questions lie in the Commissioner determining the meaning of clause 26.6.3 of the agreement, which reads: (reproduction of clause omitted).

I note that generally Part 1 of EBA 10 covers employees only of Qantas Airways Ltd, and Part 2 generally only covers employees of QCCA, but there are exceptions and cross-overs, for example in respect to language skills.  Ultimately the association's dispute is really about Qantas' use of QCCA flight attendants in preference to more senior Qantas Airways employees.

It is trite to observe that roster preparation for Qantas flight attendants is an extremely complex process involving many weeks' planning based on numerous inputs into a computer system known as Jeppesen.  These inputs include an employee's seniority, their bid preferences, points allocation, bid satisfaction, trip swapping, training, and planned leave, amongst other matters.  In my opinion these considerations must always be balanced with Qantas' ability to cover its known flying by maximising its efficiency and ensuring its operational requirements are met.

In applying the principles in AMWU v Berri, known as Berri, and related authorities, and considering the submissions of the parties, I consider that the words in clause 26.6.3 in EBA 10 are clear and unambiguous when read in the context of the clause itself, which is headed Allocation of Duties; and the agreement when read as a whole.

The inclusion of the words "where possible" and "must attempt" in clause 26.6.3 cannot mean Qantas is prohibited from utilising QCCR employees when determining rosters on mainline aircraft in circumstances where a Qantas Airways employee has already been provisionally allocated a trip in the roster process.  This is consistent with industrial reality and does not mean Qantas can ignore seniority, which is understandably so highly valued by employees.  On the other hand, the practical reality of rostering flight attendants cannot guarantee absolute seniority preference or ensure bid preferences are able to be met in every case.

In my opinion the answers to the questions pressed by both parties is no.  While not necessarily relevant to the construction exercise, I am also conscious that if Qantas is forced to abandon the proposed roster starting on 7 January it could disrupt the existing plans of hundreds of flight attendants, not to mention the unlikelihood of Qantas being able to comply with its EBA obligations if it is required to re-undertake the roster process in time to ensure known flying in three days.” 4

[25] The Deputy President noted in his decision that it was being issued without detailed reasons in order to deal with the urgent circumstances of the dispute before him. 5 He indicated at the conclusion of the decision that if either party requested more detailed reasons, they should advise his chambers within seven days.6 We note that the FAAA initially requested that the Deputy President provide his detailed reasons, but subsequently retracted this request.

Submissions

[26] The FAAA submitted that the Deputy President erred in placing reliance on the words “where possible” and “must attempt” in clause 26.6.3 in concluding that Qantas was permitted to “unlock” the roster and allocate flying lines to QCCA employees ahead of Qantas employees at its discretion, and failed to consider the other relevant clauses of the Agreement and interpret clause 26.6.3 in the context of the Agreement as a whole. The correct approach, it submitted, was as follows:

•  clause 6 of Part A , which is expressed in mandatory terms, obliges Qantas to pool and pattern known flying, allow Qantas employees to bid first for trips within this pool, allocate flying to Qantas employees from the pool in accordance with clause 26 of Part 1, and then and only then allocate flying to QCCA employees;

•  clause 26.6 requires that flight attendants employed by Qantas be awarded duties in accordance with the preferences expressed by those who have submitted a bid in order of seniority;

•  the default position where employees have submitted a bid is that Qantas is required to award them those duties, conditioned by the primacy of seniority and subject to any further limitation to be found in clause 26 itself;

•  the expression “where possible” in clause 26.6.3 does not mean where convenient or operationally suitable, but that absent impossibility the preference must be satisfied;

•  it is not possible to read the provision as introducing a general discretion to refuse employees’ preferences;

•  clauses 25.6.3, 26.7, 26.8 and 26.10 of Part 1 of the Agreement provide flexibility to Qantas to depart from the operation of the preference system in certain circumstances, and demonstrate that where any such departure was intended to be permitted, it was expressly stated;

•  treating clause 26 as permitting Qantas to depart from the preference regime where operationally convenient would reduce the detailed and highly prescriptive provision of clause 26 to being merely aspirational in nature.

[27] Permission to appeal should be granted, the FAAA submitted, because there was a dispute between the parties as to the proper interpretation of clause 26. In support of this, the FAAA tendered in the appeal a witness statement of Michael Nguyen, an industrial officer employed by the FAAA, which indicated that the issues which arose with respect to bid period 327 were likely to arise again with respect to bid period 328 which commenced on 4 March 2019.

[28] Qantas/QCCA submitted that permission to appeal should be refused because the appeal lacked utility, in that the FAAA’s dispute resolution application only related to a specific dispute concerning bid period 327, which at the time of the hearing of the appeal had commenced and was operating in accordance with the published roster. In relation to the merits of the appeal, Qantas/QCCA submitted:

•  the Deputy President had correctly construed the relevant provisions of the Agreement (namely clause 6 of Part A and cause 26 of Part 1);

•  Qantas’ rostering process had the objective of covering known flying, and any construction of the Agreement which prevented or made it operationally unfeasible for Qantas to cover known flying would be inconsistent with industrial reality, would be wholly un-business-like and should be avoided;

•  clause 26.1 of Part 1 of the Agreement confers on flight attendants employed by Qantas priority in bidding for flying patters over QCCA flights attendants, and clause 26 next deals with priority in allocation;

•  clause 26.6 deals with the allocation of preferences to flying line holders, but the priority of Qantas employees in this respect is not afforded any absolute protection (otherwise the Agreement would be unworkable and the purpose of covering known flying would rarely be satisfied);

•  clause 26.6.3 recognises that the preference of Qantas employees will not always be achieved, but it does not identify when or in what circumstances the preferences will not be satisfied and it does not give content to the attempts which Qantas must make to satisfy the flying line holder’s next preference;

•  satisfaction of the overriding objective of covering known flying provides the necessary content, so that employee preferences in flying allocation take account of, or and are to be read consistent with, operational necessity;

•  the process and methodology of “unlocking” the roster were manifestations of Qantas’ decision-making process within the framework of the rostering process in the Agreement to cover known flying while satisfying Qantas employees’ preferences where possible and as much as possible; and

•  clause 26 is drafted in non-absolute and non-definitional terms because it recognises that there are circumstances where absolute, mandatory preferences cannot be fulfilled.

Consideration

Permission to appeal

[29] We have decided to grant permission to appeal. Although the matter the subject of the proceedings before the Deputy President nominally concerned a specific dispute about the proposed roster for bid period 327, it is apparent that underlying that specific dispute is a broader issue concerning the interpretation of the rostering provisions of the Agreement. The interpretation of the Agreement preferred by the Deputy President, which upheld Qantas’ position, will in all likelihood inform future Qantas rostering decisions. Accordingly we consider that in order to avoid future disputes about the same issue and to properly resolve the underlying interpretational issue, the Deputy President’s decision should be subject to appellate review.

The appeal

[30] The Deputy President’s decision proceeded on the basis that the issue in dispute was to be resolved by reference to the terms of clause 26.6.3 of Part 1 of the Agreement. However we consider that clause 26.6.3 cannot properly be understood other than in the context of the entirety of clause 26 and the Agreement as a whole. 7

[31] The appropriate starting point for consideration is the structure of the Agreement. As earlier outlined, only Part A applies to both Qantas and QCCA flight attendants. Part 1, in which the provision relied upon by the Deputy President is located, is expressly described by clause 4 of Part A as applying only to Qantas employees (other than Transfer Employees) and as having no application to QCCA employees (or Transfer Employees). That creates tension at the outset with the proposition advanced by Qantas and inherent in the interpretation preferred by the Deputy President that clause 26.6.3 has anything to say about the rostering of QCCA employees such that in some circumstances they may be allocated flying patterns in preference to Qantas employees. Clause 4 of Part A establishes, we consider, a presumption that the provisions of Part 1 are to be read as speaking only to the circumstances of Qantas employees unless there is express language to the contrary. This is confirmed by the introductory provision in Part 1 itself, which states that Part 1 will have no application to QCCA employees or Transfer Employees.

[32] Clause 6 of Part A requires close attention because it specifically describes in an overarching way the methodology for the allocation of flying duties under the Agreement. The first three paragraphs of clause 6 are concerned with the allocation of known flying on the B747 and A330 fleets (that is, mainline operations), and the fourth paragraph is concerned with known flying on the A380 and B787 fleets. As earlier stated, we are only concerned here with the allocation of flying duties on mainline operations; allocation of duties on the A380 and B787 fleets is, as the fourth sentence makes clear, to be undertaken entirely in accordance with the relevant provisions of Part 2 of the Agreement.

[33] The first sentence of clause 6 of Part A requires known flying on the B747 and A330 fleets to be “pooled and patterned according to the rules contained in Part 1 of this Agreement”, and this provision at first blush appears to give general application to the provisions concerning allocation of flight duties in Part 1. However the provisions in the following two paragraphs give clarity to the position in this respect. First, the second paragraph of clause 6 requires that Qantas employees be given priority in both submitting bids and being allocated flying duties in mainline operations in accordance with clause 26 of Part 1. Second, the third paragraph requires that it is only flying duties on mainline operations that have not been allocated in accordance with clause 26 that may then be allocated to QCCA employees under Part 2 of the Agreement. The use of the expression “may then be allocated” in the third paragraph is strongly indicative of a sequential system of allocation, under which Qantas employees must first be allocated flying duties on mainline operations pursuant to the preferential bidding system established by clause 26, and then and only then may the flying duties which are left over be allocated to QCCA employees under Part 2.

[34] The framework established by Part A of the Agreement therefore simply does not contemplate a situation whereby a QCCA employee may be allocated a flying pattern on mainline operations ahead of a Qantas employee. It unambiguously requires that the allocation of B747 and A330 flying duties to Qantas employees pursuant to the system established by clause 26 of Part 1 be exhausted before any such duties are allocated to QCCA employees under Part 2. Accordingly we consider that clause 26 and any other relevant clause of Part 1 must be interpreted in a manner consistent with this framework unless there is express provision to the contrary.

[35] We now turn to clauses 25 and 26 of Part 1. In broad terms, clause 25 requires the construction of flying lines and reserve lines for each 56-day bid period for which Qantas employees may bid. Flying lines must, for full-time employees, be constructed to fit within the range of Qantas’ minimum and maximum hours for a bid period, and Qantas must endeavour to do the same with respect to part-time flying lines. The number of flying lines for each base must be determined, and the number of flying lines must be maximised subject to known flying to ensure adequate reserve line coverage.

[36] Clause 26 establishes the regime by which Qantas employees may bid for flying and reserve lines and be allocated bid lines in accordance with their seniority and order of preference. The first step is that Qantas provisionally designates its employees as being reserve line holders or flying line holders pursuant to clause 26.2 and subject to clauses 26.3 and 26.4 prior to the commencement of bidding. Qantas employees may then submit bids indicating their preference for the flying lines or reserve lines available in their classification and at their base pursuant to clause 26.1. The designation of employees as reserve or flying line holders must be made definitive by Qantas at the close of the bidding period.

[37] Clause 26.6 then provides for the allocation of bid lines once bids have been received and the bidding period has closed. Clause 26.6 seems to us to be constructed so that the opening sentence - “The Company must allocate preferences to employees in order of seniority of those who have submitted a bid” - establishes the paramount operating principle, and the numbered subclauses then elucidate how the allocation system is to operate in particular respects. The paramount principle referred to is expressed in unqualified terms. Although its requirement for allocation of preferences in order of seniority is expressed to apply only to those who have submitted a bid, who are by definition Qantas employees, it would be difficult to read it as leaving room for QCCA employees, who will necessarily be less senior than the most junior Qantas employee, to be allocated flying or reserve lines ahead of a Qantas employee who has submitted a bid.

[38] The numbered subclauses in clause 26, apart from clause 26.6.3, establish the following requirements:

•  clause 26.6.1 requires that the number of reserve lines awarded in a category not exceed the number of bid lines required in that category in the bid period;

•  clause 26.6.2 requires that any bid made by an employee for reserve line preference take priority, except where the employee has been identified for coach flying and subject to clause 26.4.2;

•  clause 26.6.4 provides that where an employee has failed to submit a sufficient number of preferences, the employee is deemed to have no further preferences and must be awarded any duty not otherwise awarded (presumably where the employee does not achieve any of their nominated preference because of the operation of the paramount seniority principle); and

•  clause 26.6.5 provides that where an employee does not submit a bid, they are deemed to have no preferences and are to be allocated work that has not been otherwise awarded.

[39] It may be seen that the above provisions flesh out the detail of the preferential allocation system, and do so in a way that is consistent with the overarching framework established by Part A and the paramount seniority principle in the opening sentence in clause 26. The operation of the provisions are in terms confined to “employees” – that is, Qantas employees, not QCCA employees in accordance with the definition of the term in clause 4.29. There is no contemplation in any of these provisions of any circumstance in which a QCCA employee might be allocated a flying line ahead of a Qantas employee – even where the Qantas employee has not been allocated their preferred flying lines or where the Qantas employee has not submitted a bid. In that context, it would be surprising if clause 26.6.3 alone operated to subvert the framework established by Part A, the paramount seniority principle and the detailed construct of the preferential bidding and allocation scheme by conferring upon Qantas a general discretion to depart from the scheme and give priority to QCCA employees over Qantas employees by reason of perceived operational necessity or convenience.

[40] Having regard to the context of the Agreement as we have described it, we do not consider, with respect, that clause 26.6.3 can be interpreted in the overarching manner determined by the Deputy President. Rather, its text and its place in the structure of clause 26 as a whole indicate that it has the specific purpose of establishing how the order of preferences in a bid by a Qantas employee who is a flying line holder is to be dealt with for allocation purposes. The first sentence provides that the preferences “must be” satisfied in the order indicated in the bid, but subject to the caveat “where possible”. We consider that the caveat operates in the context of the paramount seniority principle, so that the allocation of a particular preference for a flying line will not be possible when the application of the principle requires that the flying line in question be allocated to a more senior employee. The consequence of a particular preference not being able to be met is then elaborated in the second sentence of clause 26.6.3. Qantas in that circumstance “must then” attempt to satisfy the next expressed preference. Again, this is to be read in the context of the paramount seniority principle, so that the requirement is for the Qantas employee to receive their next preference provided that this preference is not overridden by the preference of a more senior employee. There is nothing in the text of clause 26.6.3 which suggests a displacement of the presumption that Part 1 provisions speak to the circumstances of Qantas employees only; to the contrary, its terms confine its operation to Qantas employees and it contains no express or implied reference to QCCA employees.

[41] That clause 26.6.3 is not to be read as allowing for general departures from the preferential bidding and allocation scheme at Qantas’ discretion is confirmed by the fact that clauses 25 and 26 provide in express terms for departures from the scheme in a number of specific and limited circumstances. These are comprised of the following:

•  clause 25.3.3 provides that representative flying may be withdrawn for known flying in a bid period and assigned for coach flying “as required by the Company” but subject to the limitation that no more than 2% of employees may be subject to training in a bid period;

•  clause 25.6.3 provides that Qantas may ignore a preference in reverse order of expressed preferences in order to be able to construct a flying line within the range of minimum and maximum hours;

•  clause 25.8 allows for reasonable special arrangements for the construction of bid lines to be implemented after consultation with the FAAA to meet unforeseen operational circumstances not accommodated by the Agreement;

•  clause 26.4.1 provides that for the purpose of allocation of reserve lines, Qantas and QCCA employees are to be treated as one group, and the allocation order provided for in clause 26.4.2 would appear to allow in some circumstances a QCCA employee to be allocated a reserve line ahead of a Qantas employee (if the QCCA employee is “without awarded carry” but the Qantas employee has “awarded carry”);

•  clause 26.7 permits Qantas to assign particular employees for coach flying of up to four flying patterns and 140 duty hour credits in a bid period in advance of the submission of employee’s submissions of bid preferences;

•  clauses 26.8 and 26.9 provide for a detailed scheme in which employees who are foreign language speakers may be assigned by Qantas to particular flight patterns requiring particular language skills, and as part of that scheme clause 26.8.1 expressly allows for QCCA employees who are foreign language speakers to be assigned ahead of Qantas employees and clauses 26.8.2 and 26.9.1 expressly allow for the preferences of Qantas employees to be overridden in identified circumstances;

•  clause 26.10.1 forbids the award of a flying line to an employee not allocated to the “category” (classification) and base for the flying line or to an employee undergoing promotional training, unless there is a reasonable expectation that the employee will be qualified and available in the category and base at or before the first day of the bid period; and

•  clause 26.10.2 forbids the award of a flying line to an employee who is on prolonged personal leave, parental leave or leave of absence without pay unless there is evidence to the satisfaction of Qantas that the employee will be qualified and available in the category and base at or before the first day of the bid period.

[42] We consider that three contextual inferences may be drawn from the above provisions. First, permitted departures from the general preferential bidding and allocation scheme are provided for in express terms. Second, clauses 26.4.1 and 26.8 refer to QCCA employees in express terms where it is necessary to give effect to an intention that the provisions have application to them and for them to have priority in allocation ahead of Qantas employees in specified circumstances. By contrast, the permitted departure from the scheme in clause 25.6.3 for example does not refer to QCCA employees (and cannot be read as applicable to them because it is based on the need to construct flying lines within the range of minimum and maximum hours – a concept which has no application to QCCA employees because under clause 9.2 of Part 2 such employees do not have a range of hours for a bid period, only a maximum number of hours). Absent any such express reference to QCCA employees, the presumption that Part 1 provisions only have applicability to Qantas employees must operate. Third, the fact that these departures are spelled out in such specificity supports the conclusion that otherwise the requirements of the scheme for preferential bidding and allocation are intended to be absolute in nature.

[43] Clause 26.12 – the final provision in the scheme – encapsulates and thereby confirms the construction we prefer. It expresses in mandatory terms (“must be”) a requirement that duties be allocated having regard to one matter only: the (Qantas) employee’s bid preferences. However this requirement operates “subject to any limitation contained in this clause”. This is strongly indicative of a mandatory scheme of allocation according to the preference and seniority of Qantas employees, subject only to permitted departures in specific circumstances which are identified in express terms.

[44] An interpretation of clause 26.6.3 by which it confers on Qantas a general and unconfined power to depart from the scheme in circumstances of perceived operational necessity is inconsistent with the structure of the Agreement as a whole, the overarching framework for the allocation of duties provided for in clause 6 of Part A and the context provided by the provision in clauses 25 and 26 for departures from the scheme in limited and specified circumstances. We consider that there is considerable substance to the submission advanced by the FAAA that the interpretation of clause 26.6.3 contended for by Qantas and adopted by the Deputy President would leave Qantas employees in a position that was in no way superior to that of QCCA employees under clause 13 of Part 2: they could express preferences, but the ultimate allocation of work would be determined according to operational requirements and at Qantas’s discretion. Such an approach would render otiose or vitiate the effect of clause 6 of Part A and most of clauses 25 and 26 of Part 1, and is unsustainable for that reason.

[45] The fact that the particular “unlocking” approach adopted by Qantas with respect to bid period 327 still resulted in a high percentage of the bid preferences of Qantas employees being satisfied is, we consider, beside the point. On the approach to the construction of the interpretation of the Agreement which we prefer, the satisfaction of Qantas’ employees bid preferences is to be determined by reference to their entitlements, and the limitations to those entitlements, provided for in clause 26 of Part A, and not at Qantas’ discretion. On the same basis, we reject Qantas’ submission that clause 26 is to be interpreted by reference solely to considerations of Qantas’ operational convenience and business efficacy. It is clear, we consider, that these provisions are constructed carefully and with precision to balance, on the one hand, an entitlement for Qantas employees to have their duties allocated according to employee seniority and their personal preferences and, on the other hand, the need for Qantas’ operational requirements to have priority in specified circumstances. It may be accepted that clause 26 does not constitute the most efficient means to allocate duties from Qantas’ perspective, and that staffing mainline operations with Qantas flight attendants in the first instance in accordance with clause 26 of Part 1 and then filling the leftover flight patterns with QCCA flight attendants involves a significant degree of complexity. However, these are the agreed arrangements and Qantas has not advanced anything which would persuade us to consider that the outcome of the interpretation of clause 26 and the provisions more generally we prefer would lead to an operationally absurd or impracticable outcome (as distinct from one which is less operationally convenient and cost efficient for Qantas than it would like).

[46] Although we consider that the text of the relevant provisions of the Agreement, considered in the context of the Agreement as a whole, is sufficient to resolve the issue in dispute between the parties, the historical context provides additional support for the interpretation of the Agreement which we prefer. Clause 26 of the Agreement (or, in the historical context, EBA 10) has its origins in a variation made by the then Australian Conciliation and Arbitration Commission (Leary C) to the Airline Flight Attendants’ (Qantas) Award (Consolidated) 1986 (1986 Award). The variation, which was made arising from a decision issued on 23 March 1988, 8 among other things added as a Schedule to the 1986 Award “Work Rules” concerning the allocation of work to Qantas flight attendants. This established a bid system for available work with the objective to “reduce roster disruption and improve stability for flight attendants and provide efficiency for the Company”. The Work Rules provided for a scheme which was largely the same as that now found in Part 1 of EBA 10 for Qantas employees, and contained provisions concerning allocation on the basis of seniority and bid preference which were expressed in terms highly similar to the current clause 26 of Part 1. Of particular relevance is that the Work Rules contained a provision in the following terms: “The Company shall allocate preferences to flight attendants in order of seniority who have submitted a bid sheet. Preferences shall be satisfied where possible in the order indicated on the bid sheet. Where a particular preference cannot be satisfied the Company shall attempt to satisfy the flight attendant’s next expressed preference”. It can be seen that the first sentence of this provision is in terms virtually identical to the opening sentence of the current clause 26.6 of Part 1, and the second and third sentences are virtually identical to the current clause 26.6.3. This demonstrates two things: first, that the original equivalent to clause 26.6.3 was not drawn with QCCA employees in mind, since QCCA was not established until 2007, but was rather a purely internal feature of the Qantas allocation scheme and, second, that it operated as an adjunct to the paramount principle of allocation according to seniority expressed in the first sentence. It is clear therefore that the original provision in the Work Rules in the 1986 Award connected the capacity to satisfy a flight attendant’s preferences with the overriding requirement to allocate preference in accordance with the seniority of flight attendants.

[47] The primary mode of industrial regulation of Qantas international flight attendants substantially shifted to enterprise bargaining in 1992 when the Qantas Enterprise Agreement 1992 (EBA 1) was made. EBA 1 did not contain a provision concerning work allocation, but operated in conjunction with the 1986 Award including its work rules. In 1993 the 1986 Award was replaced by the Airline Flight Attendants’ (Qantas) Award 1993 (1993 Award) which in clause 10 (with associated definitions in clause 4) retained the previous Work Rules in a modified form which brought them closer to their current form in Part A of EBA 10. The next two enterprise agreements, Qantas Airways Limited Enterprise Agreement II 1994-1996 (EBA 2) and Qantas Airways Limited Flight Attendants’ (International Division) Enterprise Agreement III (EBA 3), did not contain work allocation provisions but operated in conjunction with the 1993 Award. The Flight Attendants’ Association of Australia – Long Haul Division (Qantas Airways Limited) Enterprise Agreement IV (EBA 4), made in 1999, incorporated the Work Rules in further modified form as clause 32. This included clause 32.3 which was in relevantly identical terms to the current clause 26.6 in its entirety. The 1993 Award was replaced by the Airline Operations – Flight Attendants Long Haul (Qantas Airways Limited) Award 2000 (2000 Award), which largely reproduced in clause 18 (with associated definitions in clause 4) the provisions of clause 32 of the 1993 Award. The Flight Attendants’ Association of Australia – Long Haul Division (Qantas Airways Limited) Enterprise Agreement V (EBA 5), entered into in 2000, did not contain work allocation provisions but was expressed to operate in conjunction with, inter alia, EBA 4 and the 2000 Award. That position was maintained in the Flight Attendants’ Association of Australia – Long Haul Division and Qantas Airways Limited Enterprise Agreement VI (EBA 6), entered into in 2003, and the Flight Attendants’ Association of Australia – Long Haul Division and Qantas Airways Limited Enterprise Agreement VII (EBA 7), entered into in 2004.

[48] The position was altered in the Flight Attendants’ Association of Australia – International Division, Qantas Airways Limited and QF Cabin Crew Australia Pty Ltd Workplace Agreement 2007 (EBA 8), which was the first agreement made after the establishment of QCCA. EBA 8 marked the introduction of the current structure with an overarching Part A (including provisions in substantially the same form as current clauses 4 and 6 of Part A of EBA 10), Part 1 applicable to Qantas employees only on mainline operations and Part 2 applicable to QCCA employees and Transfer Employees only. In Part 1, the existing allocation scheme applicable to Qantas employees was largely carried over, but provisions which expressly reference QCCA employees were added for the first time. With some small modifications, the provisions in EBA were carried over into the Flight Attendants’ Association of Australia – International Division, Qantas Airways Limited and QF Cabin Crew Australia Pty Ltd Workplace Agreement 2012 (EBA 9) and EBA 10.

[49] This history demonstrates that clause 26.6.3 has its origins in provisions which long pre-date the establishment of QCCA and were concerned with the way in which the allocation of work to individual Qantas flight attendants in accordance with their bid preferences operated in a subordinate fashion to the paramount principle of allocation by seniority. The provision was clearly not fashioned for the purpose, or in contemplation, of QCCA employees being allocated flying lines ahead of Qantas employees to meet Qantas’ perceived operational needs. The provisions which can most clearly be associated with the establishment of QCCA (apart from Part 2) are the Part A provisions, which establish an overarching requirement that Qantas employees be fully allocated with duties on mainline operations pursuant to clause 26 of Part 1 before any such duties are allocated to QCCA employees, and the provisions of Part 1 which refer to QCCA employees in express terms and set out the strictly limited circumstances in which the overarching provisions of Part A will not apply.

Conclusion

[50] For the reasons set out above, we consider that the Deputy President’s conclusion regarding the interpretational issue underlying the dispute concerning bid period 327 was not correct. We note however that the Deputy President dealt with the dispute primarily as one of industrial merit, in the context of an application for urgent relief in respect of the imminent commencement of the bid period over the Christmas/New Year period, rather than as one centred upon the proper interpretation of the Agreement. The dispute resolution procedure in clause 9 of Part A of the Agreement, which we have earlier set out, provides (in clause 9.8) that the Commission in the exercise of its powers under the procedure must approach matters in accordance with the general principles in the XPT Case. 9 The XPT Case was, for relevant purposes, concerned with the need for restraint in any arbitral interference with discretionary managerial decision-making. However, as we have endeavoured to explain above, the relevant provisions of the Agreement did not confer upon Qantas any general managerial discretion to “unlock” rosters and assign flight lines to QCCA employees ahead of Qantas employees’ preferences. In the exercise of arbitral powers pursuant to a dispute resolution procedure in an enterprise agreement, the Commission does not have the power to determine a dispute by reference to its view as to the industrial merits irrespective of the applicable terms of the enterprise agreement, since s 739(5) forbids the Commission to make a decision which is inconsistent with that agreement.

[51] In our opinion, the correct answer to the question posed by the FAAA in the dispute is “Yes”. Qantas’ proposed question did not appropriately frame the issue in the dispute because it contains invalid premises supportive of the position it seeks to advance. In response to the Deputy President’s own formulation of the question, namely “whether in preparing roster BP327 did Qantas comply with its obligations under EBA 10?”, we consider that the correct answer is “No”. Accordingly permission to appeal is granted, the appeal is upheld, and the dispute is determined in accordance with the conclusions we have reached in this decision concerning the interpretation of the Agreement.

VICE PRESIDENT

Appearances:

Ms L Saunders of Counsel and Mr M Nguyen for the Flight Attendants’ Association of Australia

Mr M Follett of Counsel and Ms L Grey for Qantas Airways Limited

Hearing details:

2019.

Sydney:

22 February.

Printed by authority of the Commonwealth Government Printer

<PR705694>

 1   The parties have assigned either officially or colloquially a sequential number to each enterprise bargaining agreement (EBA) entered into under the statutory regimes applicable at various times since they commenced enterprise bargaining in the early 1990s.

 2   Although not relevant for present purposes, the remainder of clause 25.1 contemplates a possible future move to 28-day bid periods.

 3   Transcript 3 January 2019 PN5

 4   Transcript 3 January 2019 PNs 10-16

 5   Transcript 3 January 2019 PN5

 6   Transcript 3 January 2019 PN17. This approach is consistent with clause 9.6 of the Agreement.

 7   See AMWU v Berri Pty Ltd [2017] FWCFB 3005, 268 IR 285 at [114]; WorkPac Pty Ltd v Skene [2018] FCAFC 131, 280 IR 191 at [197]

 8   Print H1554

 9   Australian Federated Union of Locomotive Enginemen v State Rail Authority of New South Wales (1984) 295 CAR 188