[2019] FWCFB 8

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s 604—Appeal of Decision

University of New England
v
National Tertiary Education Industry Union
(C2018/6103)

VICE PRESIDENT HATCHER
DEPUTY PRESIDENT ANDERSON
DEPUTY PRESIDENT SAUNDERS

SYDNEY, 17 JANUARY 2019

Appeal against Decision [2018] FWC 5592 of Commissioner Johns at Sydney on 10 October 2018 in matter number C2018/1250 – arbitration under dispute resolution procedure in an enterprise agreement – appeal upheld in part – decision quashed in part – matter remitted to Commissioner Johns to determine remaining issues

Introduction and factual background

[1] The University of New England (University) has appealed against a decision made by Commissioner Johns on 10 October 2018 (Decision). 1 The Decision was made in arbitration of a dispute brought before the Commission by the National Tertiary Education Industry Union (NTEU) pursuant to the dispute resolution procedure in clause 58 of the University of New England Academic & ELC Teaching Staff Collective Agreement 2014 – 2017 (Agreement). The dispute the subject of the Decision concerned a direction concerning academic workloads issued on 20 February 2018 by the Dean of the Faculty of Humanities, Arts, Social Sciences and Education.

[2] The factual background to how the dispute arose was not in contest and may briefly be summarised. On 1 January 2018 the University brought a new faculty into existence, namely the Faculty of Humanities, Arts, Social Sciences and Education (HASSE). This faculty comprised two Schools: the School of Education and the School of Humanities, Arts and Social Sciences. This new Faculty of HASSE replaced four Schools (School of Education; School of Behavioural, Cognitive and Social Sciences; School of Humanities; and School of Arts) which were in existence at the time the Agreement commenced operation in 2014.

[3] Clause 20 of the Agreement deals with academic workloads, and specifically clause 20.3.2 which provides:

“Each School, through collegial consultative processes with its academic staff, will develop, implement, review and revise an Academic Workload Policy on a School basis. The Academic Workflow Policy will be considered by the Deputy Vice-Chancellor who will provide input. A School meeting will be called to consider the policy and it will be ratified by consensus. Where consensus cannot be reached, a majority Decision by vote of the applicable School staff, will determine the School Academic Workflow Policy. The School Academic Workload Policy must be consistent with the University’s Strategic Plan and academic mission of the School.”

[4] Prior to the new Faculty of HASSE commencing, an Academic Workload Policy (AWP) had been developed and implemented by the University in consultation with the academic staff for each of the four pre-existing Schools in accordance with clause 20.3.2 of the Agreement. After 1 January 2018, the University attempted to develop and implement new AWPs for the two Schools forming the new faculty of HASSE pursuant to clause 20.3.2. The new AWPs proposed by the University were put to a vote of the academic staff for the two Schools on 13 February 2018. Neither vote was successful. Following this, on 20 February 2018, the Dean of the new Faculty of HASSE issued a direction (the Dean’s Direction) setting out academic workloads for Trimester 1 pending continuation of “the consultative process for a new workload model within the two Schools.” The NTEU contended that the Dean’s Direction was made in contravention of clause 20.3.2 of the Agreement, and that the AWPs which applied before the establishment of the new Faculty of HASSE remained in effect.

[5] The NTEU made its application for the Commission to deal with the dispute on 8 March 2018. After a conference conducted by the Commissioner on 15 March 2018 failed to resolve the dispute, the NTEU made an application for interim orders to maintain the status quo (which it contended was constituted by the application of the four AWPs which were in place immediately prior to 1 January 2018) pending the final arbitration of the dispute. In a decision issued on 9 April 2018 2 (Interim Decision), the Commissioner determined to grant interim orders which required the University not to apply the Dean’s Direction and to continue to apply the pre-existing AWPs until either new AWPs were approved by academic staff, the Agreement was replaced or cancelled, or further order of the Commission.

[6] The dispute then moved to the stage of final arbitration. The University and the NTEU agreed that the dispute should be arbitrated by means of the Commissioner answering the following three questions:

(1) As at 19 February 2018 were there in existence at the University of New England extant Academic Workload Policies that had application to the School of Education and or School of Humanities, Arts and Social Sciences?

(2) If the answer to Question 1 is “Yes”, then were those policies (or any one of them) invalid workload policies by reason of them being inconsistent with either the University’s Strategic Plan or academic mission of the School?

(3) If the answer to:

(A) Question 1 is “No”, or

(B) both Questions 1 & 2 are “Yes”, then,

in the absence of a valid Workload Policy being agreed in accordance with clause 20.3.2 of the University of New England Academic and ELC Teaching Staff Collective Agreement 2014-2017 was the Dean’s Direction on 20 February 2018 a lawful exercise of managerial prerogative (XPT Case: Australian Federated Union of Locomotive Enginemen and State Rail Authority of New South Wales (1984) 295 CAR 188).

The Decision

[7] In the Decision the Commissioner gave the answer “yes” to the first question. In doing so, he first addressed the fact that the pre-existing AWPs for the School of Education and the School of Behavioural, Cognitive and Social Sciences (BCSS) specified expiry dates that were prior to 1 January 2018. In respect of these AWPs, the Commissioner concluded:

“[32] It is common ground between the parties that the School of Education had an Academic Workload Policy effective from January 2017. It is stated to be “interim”, but nonetheless was in operation as at 19 February 2018. However, noting that under the terms of the Agreement an AWP is to be developed, reviewed and revised through a collegial consultative process, it is inconsistent with the terms of the Agreement for an AWP to have an effective expiry date. To the extent that the School of Education AWP has an expiry date it must operate like a nominal expiry date operates in relation to an enterprise agreement. That is to say, until an AWP is reviewed and revised and ratified by consensus or determined by a majority (as required by clause 20.3.2 of the Agreement) it continues to apply. There is no scope within the plain and ordinary construction of clause 20.3.2 for an AWP to expiry.

. . .

[36] The School of Behavioural, Cognitive and Social Sciences (which included the Social Sciences staff that became a part of the School of HASS and the Faculty of HASSE) had an AWP dated “(2016-2017)”. It was said to operate “to the end of Trimester 3 2017 (in early 2018).” However, for the reasons already explained above, the concept of an AWP having an effective expiry date (as opposed to a nominal expiry date) it foreign to the operation of the Agreement which expressly provides for a collegial process to “develop, review and revise” AWPs. It was, therefore, extant on 19 February 2018.”

[8] In relation to the University’s contention that the pre-existing AWPs ceased operation once the Faculty of HASSE, with its two constituted Schools, was established, the Commissioner concluded:

“[38] The commencement of HASSE on 1 January 2018 did not come from nowhere. It was not a completely new creature without context or history. To suggest that the Faculty (and the two Schools that it comprises) began afresh and that all that occurred before was a nullity is as flawed as the doctrine of terra nullius (that for many years was thought to apply Australia following European settlement).

[39] While is to true that the Agreement does not expressly provide for the creation of a new Faculty or new Schools it would require a complete re-writing of the Agreement to allow for the Dean’s Direction. Such a re-writing is inconsistent with the Berri principles. The parties are stuck with the bargain they struck. The present circumstances must fit within the terms of the Agreement and clause 20.3.2 is the only clause that can be of use in this endeavour. In point of fact, the University knows this to be true. It applied clause 20.3.2 in an attempt to implement new AWPs. It was correct to employ this device. However, once it failed to replace the Attachment 2 Workloads, it was not entitled to act unilaterally by way of the Dean’s Direction.

[40] In order for an existing Academic Workload Policy to be replaced it must occur through the operation of clause 20.3.2. That is to say, it must be by a collegiate process and, absent consensus, determined by majority vote. There is nothing ambiguous about the language of the clause. The requirements to bring about a new Academic Workload Policy have not occurred at the University. Attempts were made (because the University knew the process that was required of it), but they failed. This did not give licence to the Dean to act unilaterally and impose any “interim” measure. Consequently, the Attachment 2 Workloads continue to apply.”

[9] The Commissioner answered “no” to the second question. Because the University’s appeal did not challenge the Commissioner’s answer to this question, it is not necessary to refer to the Commissioner’s reasons for giving this answer. As a result of the Commissioner’s answer to the first two questions, it was unnecessary for him to consider question 3.

[10] The Commissioner made orders giving effect to his Decision which made final the interim orders made in the Interim Decision. He also determined that where the Dean’s Direction resulted in employees undertaking additional teaching beyond that provided for in the AWPs, their workloads for the balance of the year had to be adjusted. 3

Submissions in the appeal

[11] The University submitted that:

● the Commissioner’s answer to question 1 was incorrect;

● the Commissioner erred in determining that the pre-existing AWPs for the Schools of Education and BCSS did not cease effect once they reached their specified expiry dates;

● there was nothing in the language of clause 20.3.2 which prevented the University and academic staff agreeing upon an AWP which operated for a limited period of time;

● the prescription in clause 20.3.2 of a process for revising AWPs was not inconsistent with an AWP operating for an agreed limited period;

● there was no proper basis for the Commissioner to draw a parallel between the expiry dates in the two AWPs and the nominal expiry dates for enterprise agreements under the Fair Work Act 2009 (FW Act);

● additionally and in any event, the Schools of Humanities, Arts and BCSS ceased to exist upon the establishment of the School of Humanities, Arts and Social Sciences as part of the new Faculty of HASSE, and the AWPs which were expressed to apply to the previous schools could not be read as applicable to the new School;

● the result of the approach taken by the Commissioner was that multiple AWPs would apply to a Single school, in circumstances where it was clear that clause 20.3.2 of the Agreement only contemplated one AWP applying to a School;

● accordingly permission to appeal should be granted, the Decision (including the consequential orders) quashed, and the matter returned to the Commissioner for the determination of question 3.

[12] The NTEU submitted that:

● there was no public interest consideration or other matter which would justify the grant of permission to appeal;

● the Commissioner correctly interpreted the agreement consistent with the principles stated in the Full Bench decision in AMWU v Berri Pty Ltd 4 (Berri);

● clause 20.3.2 did not provide for or contemplate the termination of an AWP; rather it required a School to implement an AWP which had been approved by academic staff, and once implemented it could only be reviewed and revised;

● the AWPs took their force from clause 20.3.2 of the Agreement, so that any term in an AWP which was inconsistent with that clause (such as a termination date) would not have effect;

● in any event, the pre-existing AWP for the School of Education did not contain an express term that it would cease to apply, and the AWP for the former School of BCSS only contained an “expected period of operation”;

● the establishment of the new Faculty of HASSE did not involve any restructure beyond a change in the reporting line, and the University continued to allocate academic workloads in accordance with the AWPs after 1 January 2018 and until 19 January 2018;

● because clause 20.3.2 required AWPs to continue to apply until they were reviewed or revised, the pre-existing AWPs could not have ceased to have effect when the Faculty of HASSE (including the new School of Humanities, Arts and Social Sciences) were established;

● employees the subject of an AWP whose School is re-named cannot be denied the application of clause 20.3.2;

● Question 1 was correctly determined by the Commissioner, and therefore the appeal should be dismissed.

Consideration

Permission to appeal

[13] Although there may have been an argument available that the disputes settlement procedure in the Agreement, which at clause 58.3.4 provides that “the parties to the dispute will be bound by and implement any recommendation or Decision of the FWC subject to an appeal to the Full Bench of the FWC”, confers an independent right of appeal, both parties proceeded on the basis that permission to appeal was required. We will therefore proceed on the basis that permission to appeal is required. We consider that permission to appeal should be granted because we are satisfied, for the reasons that follow, that the Decision is attended with sufficient doubt to warrant its reconsideration and that substantial injustice may result if permission to appeal is refused.

Merits of the appeal

[14] In considering the correctness of the Commissioner’s answer to Question 1, it is necessary to consider the position of the School of Education separately from that of the other pre-existing schools. This is because, notwithstanding the establishment of the new Faculty of HASSE, the School of Education remained in existence as a separate entity within the new faculty. No argument is therefore available that the pre-existing AWP applicable to the School of Education ceased operation because of the abolition of the school, in contrast to the former Schools of Humanities, Arts and BCSS. Accordingly the critical issue in respect of the School of Education AWP is whether it ceased operation prior to 1 January 2018 because its terms provided for an expiry date.

[15] The School of Education AWP entered into pursuant to clause 20.3.2 of the Agreement states in the header on each page that it was “endorsed at the SOE Meeting 24 November 2014”. In it heading it states that it is “Effective 01 January 2015 to 31 December 2016”. That appears to represent an agreed position that it would not be applicable after 31 December 2016. However clause 1.7 of the AWP provides:

“Review – This policy and implementation plan will be reviewed in two years (2016) for the School’s endorsement. Any proposed refinements will be discussed within the School and any resulting revision of the policy and implementation will be determined by consensus or by majority among the Academic staff of the School. A special meeting of the SOE Workload Committee can be called if any urgent matters to be discussed arise during the year. Noted that a special meeting can be called at any time by any member of the School or the HOS.”

[16] Clause 1.7 in its terms contemplates a review process to occur at or towards the end of the period of operation identified in the heading to the AWP. It is necessarily implicit in the clause that this review process might lead to the AWP continuing in effect beyond the end of 2016, otherwise the provision would serve no practical purpose. There are two express conditions attached to the review process:

(1) The review was subject to “the School’s endorsement”. We read that to mean that the reviewed AWP could not continue to operate unless endorsed by the School of Education.

(2) If the AWP was the subject of any “refinements” or “revision” – that is, if it was to be altered – this had to be the subject of discussion within the School and accepted by “consensus” or a majority vote of academic staff.

[17] The evidence before the Commissioner demonstrated that a review process for the purpose of extending the operation of the AWP beyond 31 December 2016 occurred in late 2016. On 1 December 2016, academic staff in the School of Education were advised that there would be an electronic vote for a 2017 workload policy. The document in question to be voted upon was headed “Interim 2017 Workload Policy” and was stated to be effective from 1 January 2017. It did not contain any expiry date. Clause 1.7 was modified to provide for the review to be conducted “annually” (rather than “in two years (2016)”), but was otherwise unchanged. There were some other minor changes in the document.

[18] On 7 December 2016 the Head of the School of Education sent an email to staff which stated:

“The vote for the 2017 Workload Policy closed at 12noon today (07 December 2016). A number of emails were received from staff advising they were unable to lodge their vote this morning due to a system failure that was unable to be rectified before voting closed. From a total of 59 eligible staff, 34 votes were recorded in the period from opening last week up to the system failure this morning. This leaves 25 votes still outstanding.

Given this situation, and that there were a substantial number of votes unable to be registered, it leaves me with no other option than to declare this voting process invalid. With only weeks to go before the Christmas break I will not be calling another vote this year.

Consequently, the current 2016 academic workload policy will carry forward into 2017. This will enable staff Advised EFTSL to be developed and sent out to staff for 2017 workloads.

I thank all those staff who have participated in the workload committee meetings and associated discussions. It has been a constructive and informative process. One the new academic year commences I encourage you to support the (yet to be appointed) interim Head of School in revisiting the workload policy in 2017.”

[19] It is important to note that it was the 2016 AWP, not the “interim” 2017 policy that was put to the aborted vote, that was carried forward. This AWP remained in place into the 2018 academic year and up until the time of the Dean’s Direction. There is nothing in the text of clause 20.3.2 or clause 20 as a whole which supports the proposition that an AWP which had been formed in the manner contemplated by clause 20.3.2 and which continues to apply to a School ceases to operate simply because that School is placed into a newly formed faculty. We consider therefore that it was plainly established on the evidence that the original AWP for the School of Education remained extant as at 19 February 2018, and that in respect of this School the Commissioner’s answer of “yes” to Question 1 was correct.

[20] In respect of the School of Humanities, Arts and Social Sciences (HASS) the situation is different. Upon the formation of the new faculty, the three former Schools (School of Behavioural, Cognitive and Social Sciences; School of Humanities; and School of Arts) ceased to exist and became a single School of Humanities, Arts and Social Sciences.

[21] Although the AWPs applicable to the three former Schools were each made by the University and the academic staff of each of those Schools in a collegiate manner under clause 20.3.2 of the Agreement, they were not made between the University and the academic staff of the newly formed School. Upon the formation of that new School and the disbandment of the three former Schools, only the combined effort of the University and the collective academic staff of the new School could create an AWP that meets the requirements of clause 20.3.2.

[22] There is nothing in the language or context of clause 20.3.2 which would permit an AWP made by the bodies of academic staff in disbanded Schools to apply to a new School with a differently constituted body of academic staff. Clause 20.3.2 is prefaced with the words “Each School”. It refers to an AWP being made “on a School basis”, the calling of “A School meeting” and a vote by “the applicable School staff”. The provision therefore contemplates only that there would be a single AWP applicable to each established School in the University, and not that there could be multiple AWPs carried over from abolished Schools to a new School. While it might be considered unsatisfactory that clause 20.3.2 does not address the situation where there is a restructuring of Schools, there is simply nothing in the language of clause 20.3.2 or clause 20 as a whole that provides for any transitional arrangement for the continuation of an historic but inoperative AWP in a newly formed School.

[23] In concluding otherwise we consider the Commissioner to have fallen into error. The Commissioner observed that “the work of the academics in each of these Schools did not change”. 5 This is not a relevant consideration in assessing whether a School existed at the relevant date or in assessing the academic constitution of that School. The Commissioner was also incorrect to conclude that “the present circumstances must fit within the terms of the Agreement”,6 since what was required by Question 1 was to determine whether, under clause 20.3.2 properly construed, the relevant AWPs were extant. Straining clause 20 of the Agreement to give it operation in respect of something it does not provide for (the creation of a new School) was not a proper application of the Berri principles. Doing so was akin to making a presumption that an historic AWP was extant simply because the alternative (no AWP made in accordance with clause 20.3.2) might arise and was considered undesirable. Such an approach was in error. Nor was it correct for the Commissioner to characterise the Dean’s Direction of 20 February 2018 as having “replaced”7 the historic AWP. The historic AWPs did not survive the creation of the new Faculty and School on 1 January 2018. Not having been in existence on 19 February 2018, they could not have been replaced the next day.

[24] Further, to the extent the Commissioner surmised that a construction other than the one he preferred could allow a University to defeat an AWP by restructuring a School, 8 he fell into error. As earlier stated, the language of the Agreement makes no reference to nor contemplates a set of special arrangements for the preservation of previous AWPs in a newly formed School. The Agreement simply provides for AWPs to be made in accordance with clause 20.3.2, and accordingly the new School of Humanities, Arts and Social Sciences remains under an obligation to develop and implement a new AWP in accordance with the provision. There is no alternative construction of clause 20.3.2 that is reasonably available which supports the conclusion reached by the Commissioner. In any event, there was no evidence to support the conclusion that the faculty restructure was intended by the University to “defeat” the existing AWPs.

[25] For these reasons, Question 1 should have been answered “no” with respect to the School of Humanities, Arts and Social Sciences and “yes” with respect to the School of Education.

[26] The consequence of this conclusion is that it is necessary for Question 3 to be answered with respect to the School of Humanities, Arts and Social Sciences – that is, whether the Dean’s Direction of 20 February 2018 for the purposes of that School represented a lawful exercise of managerial prerogative. We consider the Commissioner to be best placed to answer that question. He did not do so in the Decision because of his answers to questions 1 and 2. We will remit that aspect of the dispute back to the Commissioner for determination. He has taken evidence enabling that question to be answered and in light of this Decision may consider it appropriate to give the parties an opportunity to tender further evidence or make additional submissions. We will leave those procedural assessments to the Commissioner.

[27] In terms of the orders made by the Commissioner, in light of this Decision, there may be grounds to quash the Commissioner’s orders with respect to the School of Humanities, Arts and Social Sciences (HASS). However, to do so in advance of determining Question 3 would be premature. With respect to HASS, the balance of convenience favours the retention of the Commissioner’s orders as a holding position until such time as Question 3 is determined. The effect of quashing the order with respect to the School of Humanities, Arts and Social Sciences would be to give immediate effect to the Dean’s Direction. With a new academic year approaching, it would not be desirable to do so in advance of a Decision as to its lawful status. Whilst this means the continuation for a period of time of the historic AWPs (which we have found was wrongly held to be extant) this is the industrially preferable course.

[28] We do not consider that the Commissioner was in error with respect to the School of Education. Accordingly the order continues to apply in that regard.

Conclusion

[29] For the reasons given, we:

(a) grant permission to appeal to the extent required;

(b) uphold the appeal with respect to the School of Humanities, Arts and Social Sciences;

(c) remit to the Commissioner the determination of Question 3 with respect to the School of Humanities, Arts and Social Sciences;

(d) preserve in effect the orders made by the Commissioner with respect to the School of Humanities, Arts and Social Sciences pending the final determination of Question 3; and

(e) otherwise dismiss the appeal.

scription: Seal of the Fair Work Commission with the member's signature.