2025 WAIRC 00015
INDUSTRIAL MAGISTRATES COURT OF WESTERN AUSTRALIA


CITATION
:
2025 WAIRC 00015



CORAM
:
INDUSTRIAL MAGISTRATE D. SCADDAN



HEARD
:
WEDNESDAY, 27 NOVEMBER 2024



DELIVERED
:
FRIDAY, 10 JANUARY 2025



FILE NO.
:
M 19 OF 2024



BETWEEN
:
AUSTRALIAN WORKERS' UNION


CLAIMANT





AND





UGL RESOURCES (CONTRACTING) PTY LTD


RESPONDENT

CatchWords : INDUSTRIAL LAW – Construction of a clause of an enterprise agreement – Entitlement to Shift Over Cycle rate – Determination of when Shift Over Cycle rate is paid
Legislation : Fair Work Act 2009 (Cth)
Industrial Relations Act 1979 (WA)
Superannuation Guarantee (Administration) Act 1992 (Cth)
Instrument : UGL Resources (Contracting) Pty Ltd Karratha Enterprise Agreement 2019
Case(s) referred
to in reasons: : City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union [2006] FCA 813; (2006) 153 IR 426
Transport Workers’ Union of Australia v Linfox Australia Pty Ltd [2014] FCA 829; (2014) 318 ALR 54
Kucks v CSR Ltd [1996] IRCA 166; (1996) 66 IR 182
Amcor Limited v Construction, Forestry, Mining and Energy Union [2005] HCA 10; (2005) 214 ALR 56
King v Melbourne Vicentre Swimming Club Inc [2020] FCA 1173
King v Melbourne Vicentre Swimming Club Inc [2021] FCAFA 123
Mildren v Gabbusch [2014] SAIRC 15
Miller v Minister of Pensions [1947] 2 All ER 372 
Briginshaw v Briginshaw [1938] HCA 34; 60 CLR 336
Fedec v The Minister for Corrective Services [2017] WAIRC 00828; 97 WAIG 1595
Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Excelior Pty Ltd [2013] FCA 638 

Result : Claim dismissed
Representation:
Claimant : Mr K. Sneddon (of counsel)
Respondent : Mr R. Boothman (of counsel)



REASONS FOR DECISION


1 The effects of the novel Coronavirus, COVID-19, and the subsequent global pandemic continues to reverberate years after a return to normalcy. It is trite to say that in March 2020 desperate steps were taken to protect people and infrastructure, and it is reasonable to say that steps were often taken ‘on the fly’. There were no crystal balls.
2 The relevance of this is that in July 2019 when the UGL Resources (Contracting) Pty Ltd Karratha Enterprise Agreement 2019 (UGL Agreement) was approved by the Fair Work Commission, the people and organisations involved in negotiating and approving the UGL Agreement were highly unlikely to have ever turned their mind to how it would operate during a period of nationwide lockdown due to a global pandemic.
3 But, as the uncontroverted evidence reveals, in February and March 2020 the parties to the UGL Agreement worked collaboratively to implement a change of roster cycle designed to keep the workers working at the Karratha Gas Plant and, no doubt, to ensure UGL Resources (Contracting) Pty Ltd (the respondent) maintained its commercial agreement with Woodside Energy Limited (Woodside).
4 On 5 March 2024, the Australian Workers Union (the claimant) lodged a claim alleging the respondent failed to pay Shift Over Cycle rates for time worked over 10 hours in a shift to a group of alleged affected workers (the Affected Workers) from 7 May 2020 to 4 March 2022 (the Claim).
5 In failing to pay Shift Over Cycle rates, the claimant alleges the respondent has contravened s 50 and s 323 of the Fair Work Act 2009 (Cth) (FWA) in that the respondent has contravened cl 14.8 of the UGL Agreement.
6 The claimant claims:
· $34,861.43 (as amended) in underpayment to the Affected Workers;
· interest on the amount claimed; and
· payment of a civil penalty to be paid to the claimant.
7 The respondent denies the alleged contravention and says the controversy between the parties involves interpreting cl 14.8 of the UGL Agreement where the respondent says the Shift Over Cycle rates only applies to hours worked in excess of those contemplated in a given roster cycle.
8 After considering the Claim and the respondent’s evidence (see below), the claimant accepted that it did not have standing to continue the Claim as it related to an alleged contravention of s 50 of the FWA. However, the parties agreed the claimant had standing to continue the Claim as it related to an alleged contravention of s 323 of the FWA The claimant was not a party to the UGL Agreement, and it did not otherwise concern the claimant: for an alleged breach of s 50 of the FWA, see s 539(2), item 4 of the FWA when read with s 540(3) of the FWA. However, for an alleged breach of s 323 of the FWA, see s 539(2), item 10 when read with s 540(2) of the FWA.
.
9 Schedule I of these reasons outlines the jurisdiction, standard of proof and practice and procedure of the Industrial Magistrates Court (IMC or Court).
10 Schedule II of these reasons outlines the principles applicable to construction of an industrial agreement.
Agreed Facts
11 The parties provided a statement of agreed facts Exhibit 1 – Agreed Statement of Facts.
.
12 In summary, the claimant has standing to commence the Claim (as amended), and the respondent is a national systems employer under the FWA. The UGL Agreement covers and applies to the parties and to the Affected Workers after the Fair Work Commission approved it on 3 July 2019 Exhibit 2 – Further Agreed Statement of Facts.
.
13 The following table details the Affected Workers at the Karratha Gas Plant, the dates of their employment relevant to the Claim, the number of shifts each worked of 10.87 hours in length and the amount claimed The respondent does not accept the amounts claimed as it does not accept it has liability to pay these amounts.
in relation to each Affected Worker:

Name
Affected employment dates
Number of shifts
Amount claimed See footnote 2.

Robert Clark

11 May 2021 – 4 March 2022
157
$3,833.16
Erwan De Pelseneer

16 June 2021 – 15 February 2022
112
$2,914.92
Peter Fellows

7 May 2020 – 20 January 2022;
2 February 2022 – 15 February 2022
271
$5,770.69
David Hall

18 June 2021 – 4 March 2022
104
$2,802.92
John Hicks

7 May 2020 – 18 July 2020;
11 August 2020 – 26 February 2021;
15 April 2021 – 27 October 2021
135
$4,189.02
Liam O’Donnell

7 May 2020 – 22 February 2022
253
$5,118.41
Michael Pavleka

7 May 2020 – 4 September 2021;
25 October 2021 – 4 March 2022
283
$4,752.75
Matthew Henry Turner

24 March 2021 – 4 March 2022
158
$2,302.96
Mark Williams

16 June 2021 – 16 October 2021;
20 October 2021 – 22 February 2022
93
$3,176.60

14 In each case, the respondent paid each Affected Worker for all time worked but 0.87 hours was paid at the base rate of pay whereas the claimant says 0.87 hours should have been paid at the Shift Over Cycle rate.
15 That is, the respondent paid each Affected Worker 10.87 hours at the base rate of pay rather than on the claimant’s case each Affected Worker should have been paid 10 hours at the base rate of pay and 0.87 hours at the Shift Over Cycle rate.
Other Evidence
16 The respondent relied upon a witness statement by Terence John Clement Elliott (Mr Elliott) signed and dated 27 September 2024 Exhibit 3 – Statement of Terrence John Clement Elliott dated 27 September 2024.
(Elliott Statement). Mr Elliott’s evidence was not contested.
17 Mr Elliott is employed as Group Manager Industrial Relations – Corporate by UGL Pty Ltd and is responsible for overseeing all of the industrial relations activities of entities within the UGL corporate group, which includes the respondent Exhibit 3 at [1] and [2].
.
18 Mr Elliott provides some historical background to the respondent’s services contract with Woodside for the provision of brownfields implementation service at the Karratha Gas Plant and other Woodside-operated sites Exhibit 3 at [7] to [9].
.
19 In February 2018, the respondent commenced bargaining for what was to become the UGL Agreement. The Australian Manufacturing Workers’ Union (AMWU) and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) were the bargaining representatives. Mr Elliott contributed to and signed off on the UGL Agreement Exhibit 3 at [11] to [14].
.
20 The UGL Agreement covered the respondent, the AMWU, the CEPU, and the respondent’s employees who performed work in connection with any Woodside operated facility in Karratha and fell within the UGL Agreement classification structure. This includes the Affected Workers but not the claimant.
21 The UGL Agreement was subsequently replaced by a new enterprise agreement on 19 May 2023 which covered the same parties, but now included the claimant Exhibit 3 at [16].
.
22 Mr Elliott explains the bargaining process around the UGL Agreement Exhibit 3 at [17] to [21].
.
23 In summary, employees at the Karratha Gas Plant were engaged on a 28-day roster cycle of 19 days on and 9 days off (19:9 Roster) and were rostered to work 10 hours per day for 19 days. The total hours worked in 28 days was 190 hours, which comprised 152 ordinary hours (based on an average weekly hours of 38) and 38 overtime hours, and they were paid a flat all-inclusive rate (referred to as a ‘loaded rate’).
24 The effect of the loaded rate was that employees were paid the same rate whether they worked ordinary hours or overtime hours for the 190 hours UGL Agreement at cl 8.1.1 and Appendix 2 (for permanent employees) and Appendix 3 (for casual employees).
.
25 The 19:9 Roster formed the backbone of bargaining to the UGL Agreement, although UGL proposed a future change of roster cycle to 18 days on and 10 days off (18:10 Roster) which comprised 152 ordinary hours and 28 overtime hours (180 hours) with the same flat all-inclusive rate being paid to compensate for the reduction of overtime hours worked.
26 The bargaining team alerted Mr Elliott to the AMWU and CEPU’s concern that Woodside may wish to increase hours of work to an 11 or 12-hour day, consistent with another on-site contractor’s employment conditions. In that case, the loaded rates provided in the proposed agreement may not compensate employees for any extra overtime worked on either a 19:9 Roster or 18:10 Roster.
27 To address this possibility, the bargaining parties agreed to Shift Over Cycle rates UGL Agreement at Appendix 4
, which would compensate employees if the hours per day were to increase as contemplated in cl 14.3 of the UGL Agreement applicable to shutdown work requiring 12-hour days.
28 According to Mr Elliott, the Shift Over Cycle rate was designed to compensate employees for time worked in excess of 190 rostered hours (and the future 180 rostered hours) because the loaded rate did not contemplate or compensate work in excess of 190 hours under the 19:9 Roster. He explains cl 14.8 refers to work in excess of 10 hours per shift meaning employees working in excess of the 190 rostered hours per roster cycle Exhibit 3 at [22].
.
29 The COVID-19 pandemic resulted in negotiations between the respondent, the AMWU, CEPU, Woodside and the respondent’s employees at the Karratha Gas Plant to enable maintenance works and employment to continue involving a 70% FIFO workforce. Ultimately, an even time roster of 14 days on and 14 days off was agreed (14:14 Roster) where Woodside’s sites had been declared an ‘essential asset’ by the Western Australian Government. The 14:14 Roster was modelled on the respondent’s rosters at Esso facilities in Victoria and Barrow Island in Western Australia Exhibit 3 at [23] to [27].
.
30 The respondent’s employees were declared ‘essential workers’ under the Resources Industry Worker (Restriction on Access) Directions and were able to continue to travel subject to quarantine restrictions Exhibit 3 at [28].
.
31 Mr Elliott recounts two concerns raised by Glenn McLaren, AMWU Assistant State Secretary about the 14:14 Roster. The first was that if the respondent maintained 10-hour shifts under the 14:14 Roster, employees may be worse off where they would not complete the full-time hours within the 28-day cycle and lose up to 12 hours superannuation. The second was that employees would be working on a part time basis because their hours would be less than the full time equivalent Exhibit 3 at [29].
.
32 Mr Elliott states the respondent, the AMWU and the CEPU agreed a resolution where Exhibit 3 at [30] and [31].
:
· the respondent retained the all-inclusive pay rates, notwithstanding employees worked 152 hours rather than 190 hours and earn less pay, but would have more recreational days off and retain their jobs during the COVID pandemic restrictions; and
· the shift length would increase from 10 hours to 10.867 hours on a temporary basis so as to ensure employees met the base requirement of working 152 hours (based on an average 38 hour working week in a roster cycle). This also enabled the accrual of annual and personal leave based on an average 38 hour working week.
33 In February 2020, the respondent notified employees of its intention to vary the roster cycle to the 14:14 Roster under cl 14.5 of the UGL Agreement and on or around 7 March 2020 the roster cycle was changed Exhibit 3 at [32] and [33].
.
34 Mr Elliott explains that under the 14:14 Roster, the respondent continued to pay employees at the all-inclusive rate specified in Appendix 2 of the UGL Agreement even though this rate contemplated employees working 38 hours of overtime. Employees did not work overtime during the 14:14 Roster so while they were paid less than on the 19:9 Roster, they were paid a proportional amount more because of what the all-inclusive rate was designed to compensate for Exhibit 3 at [34a-c].
.
35 In addition, the respondent made superannuation contributions for each of the 10.87 hours worked per shift and employees accrued annual and personal leave on 10.87 hours worked per shift Exhibit 3 at [34d-e].
.
36 In respect of the Shift Over Cycle rates, Mr Elliott explains that under the 14:14 Roster and the 19:9 Roster the respondent paid employees for all work performed in excess of their rostered hours within a roster cycle. Accordingly, Shift Over Cycle rates were paid for all work performed either over 152 rostered hours or 190 rostered hours, respectively Exhibit 3 at [35].
.
37 The respondent did not make superannuation contributions and employees did not accrue annual and personal leave for work paid at the Shift Over Cycle rate consistent with cl 14.8 and cl 17.1 of the UGL Agreement Exhibit 3 at [36]-[37].
.
38 Mr Elliott’s understanding, based on his experience in the oil and gas industry, is that it is widely accepted the phrase ‘over cycle’ refers to hours or work performed in addition to either the normal shift length in a roster cycle or for days worked in excess of an ‘on cycle’. The purpose of an over cycle payment being to compensate an employee for having to work additional hours or days reducing available recreational time Exhibit 3 at [38].
.
The Parties’ Contentions
39 The principles applicable to the interpretation of industrial agreements are well known. In summary, the interpretation of an industrial instrument begins with consideration of the natural and ordinary meaning of the words used City of Wanneroo v Australian Municipal, Administrative, Clerical and Services Union [2006] FCA 813; (2006) 153 IR 426, 438 (City of Wanneroo).
. An industrial instrument is to be interpreted in light of its industrial context and purpose and must not be interpreted in a vacuum divorced from industrial realities City of Wanneroo 438, 440.
. An industrial agreement must make sense according to the basic conventions of the English language City of Wanneroo 440.
. The circumstances of the origin and use of a clause is relevant to an understanding of what is likely to have been intended by its use Transport Workers’ Union of Australia v Linfox Australia Pty Ltd [2014] FCA 829; (2014) 318 ALR 54.
. Narrow and pedantic approaches to the interpretation of an industrial agreement are misplaced Kucks v CSR Ltd [1996] IRCA 166; (1996) 66 IR 182; Amcor Limited v Construction, Forestry, Mining and Energy Union [2005] HCA 10; (2005) 214 ALR 56.
.
The claimant’s submissions
40 The claimant relies upon the ordinary words of cl 14.8 of the UGL Agreement read as a whole and in context. However, the claimant says that while context may assist in the interpretative task, it does not displace the primacy of the language used. The ‘inquiry is directed to the proper construction of what the instrument says, and not what it was meant to say.’ King v Melbourne Vicentre Swimming Club Inc [2020] FCA 1173 at [122] (King).

41 In summary, there is no room for subjectivity or a search for the makers’ subjective intent. It is not open for these proceedings to rewrite the clause. Further, the claimant says there is no common understanding where the respondent’s evidence is only evidence of the respondent’s intention or unilateral understanding. The claimant disputes there was a meeting of the minds.
42 Clause 14.8 of the UGL Agreement is unambiguous and is not qualified in any way. That is, once an employee works over 10 hours, they are entitled to the Shift Over Cycle rate, and the only condition is the length of the shift.
43 It is unnecessary for an employee or the employer to read any other words into the clause, which would introduce ambiguity where it otherwise does not exist. The respondent’s suggested interpretation introduces words and a nexus to a roster cycle, which does not exist and complicates an otherwise easily understood meaning. The respondent’s position is a ridiculous situation where 10 hours does not mean 10 hours but means something other than 10 hours.
The respondent’s submissions
44 The respondent says the claimant was not a party to the UGL Agreement and the claimant lacks an understanding of the surrounding circumstances in the making of the UGL Agreement and in the introduction of the 14:14 Roster.
45 Fundamentally, the respondent says the parties to the UGL Agreement agreed a different roster cycle with shift hours varied to 10.87 hours at the commencement of the COVID-19 pandemic restrictions.
46 The respondent further says the claimant’s construction of cl 14.8 of the UGL Agreement does not pay due regard to the context of the Agreement as a whole and the purpose of the Shift Over Cycle rates contemplated between the parties at the time the UGL Agreement was made. According to the respondent, when properly considered it is apparent that cl 14.8 conferred an entitlement when employees worked in excess of their Rostered Hours on a shift.
47 The respondent refers to the lack of clear definition of ‘Shift Over Cycle rate’ and ‘Over Cycle’ in the UGL Agreement and says both should be construed having regard to its industry meaning as provided in the Elliott Statement. Further, the combined reading of cl 14.8 and cl 14.9 of the UGL Agreement evinces an intention for the Shift Over Cycle rate to compensate employees for time worked in excess of the Rostered Hours within the Roster Cycle.
48 The effect, on the respondent’s submission, is where an employee is rostered to work in excess of 10.87 hours on a shift on a 14:14 Roster they are entitled to payment at the Shift Over Cycle rate.
49 The respondent also refers to the two types of hours worked under the UGL Agreement and, in essence, says that Shift Over Cycle rate is only payable on Overtime Hours not on Ordinary Hours worked during Rostered Hours or on Rostered Shift.
50 Additionally, if the claimant’s construction of cl 14.8 of the UGL Agreement is accepted, the payment of Shift Over Cycle rate payable on Ordinary Hours means that for the Affected Workers 0.87 hours of Ordinary Hours do not attract superannuation contrary to the Superannuation Guarantee (Administration) Act 1992 (Cth) (SGA Act) (and which was paid by the respondent).
51 The UGL Agreement was bargained for and made with the 19:9 Roster (and 18:10 Roster) in mind. When this context is properly regarded, it is clear that the reference in cl 14.8 to an employee being regarded to work in excess of 10 hours per shift was intended to reflect the shift length under the 19:9 Roster (and 18:10 Roster) and was confined to that roster structure.
52 The respondent accepts that cl 14.8 of the UGL Agreement was not drafted more clearly to reflect the intention behind the reference to ’10 hours’. However, this should not prevent the Court from, or be relied upon to, not giving effect to its evident purpose. The respondent says the evident purpose was to compensate employees for hours worked in excess of their Rostered Hours (as that term is defined) on a given shift.
53 Where the Roster Cycle was permissibly changed to a 14:14 Roster and the Rostered Hours were permissibly changed to 10.87 hours, the reference to 10 hours in cl 14.8 should now be read to reflect the shift length under the new Roster Cycle.
54 The respondent outlines a hypothetical roster involving 20 days on and 8 days off where the employee works 7.6 Ordinary Hours (152 hours over a four-week period). On the hypothetical roster, the respondent says that on the claimant’s construction an employee who worked 10 hours on a shift would not be entitled to Shift Over Cycle rate for the additional 2.4 hours, whereas on the respondent’s view they would.
55 The respondent says this supports the preferred construction that cl 14.8 renders the Shift Over Cycle rate payable when an employee works in excess of their Rostered Hours (as that term is defined) on a given shift.
What is the preferred construction of when the entitlement to Shift Over Cycle rates applies?
UGL Agreement
56 The UGL Agreement provides for two classes of employees; Full Time and Casual. A Full Time Employee is engaged to work an average of 38 ordinary hours per week averaged over a four-week period. The effect of this is that a Full Time Employee is required to work 152 ordinary hours over a four-week period Clause 5.2.1 and 5.2.2 of the UGL Agreement and cl 1.1 definitions.
.
57 The Ordinary Hours and Overtime Hours will be worked in accordance with the Rostered Hours at a Site Clause 5.2.2 of the UGL Agreement.
.
58 Rostered Hours or Rostered Shift means the number of Ordinary Hours and Overtime Hours required to be worked by employees in the Roster Cycle. Work may be rostered 10 hours per day or as otherwise amended from time to time Clause 1.1 of the UGL Agreement.
.
59 Consistent with Mr Elliott’s evidence, but subject to cl 14.15 of the UGL Agreement, the hours of work are ordinarily worked over a roster cycle on a compressed basis. The subject to is that there are three roster cycles referred to in the UGL Agreement: the 19:9 Roster (and future 18:10 Roster) also referred to as the FIFO or Non-Local roster; five days worked Monday to Friday and two days off also referred to as the Local roster; and six days on and one day off also referred to as the Shutdown roster.
60 Also consistent with Mr Elliott’s evidence about the bargaining and making of the UGL Agreement, the employees on the 19:9 Roster were paid for 190 hours of work each roster cycle where the rostered hours on each day was ‘currently 10 hours in duration’ made up of ordinary hours and overtime hours Clause 14.4 of the UGL Agreement.
. That is, the employees on the 19:9 Roster were paid for 152 ordinary hours worked and 38 overtime hours worked.
61 However, all employees were paid at a flat all-inclusive rate which compensated for ordinary and overtime hours, irrespective of whether the employee was on the 19:9 Roster, a Local roster or Shutdown roster. Thus, an employee working on a Local roster was being paid at the same rate as an employee on the 19:9 Roster, notwithstanding they may not work more than 152 ordinary hours in a four-week period, but they would continue to be paid the same rate if they worked overtime Clause 8.1.1 of the UGL Agreement and cl 1.1 definitions.
.
62 Clause 14.3 of the UGL Agreement refers to the Shutdown roster which requires employees to work 12 hours per day and provides ‘[t]he Shift Over Cycle rate shall be paid to Employees for hours worked in excess of 10 hours per day on Shutdowns.’
63 Superannuation is paid in accordance with the SGA Act ‘on Ordinary Time Earnings at the all-inclusive rate which incorporates all allowances and penalties’: cl 13.1 and cl 13.2 of the UGL Agreement. Ordinary Time Earnings is not defined in the UGL Agreement, and the respondent says it should be construed consistently with the SGA Act.
64 Section 6(1) of the SGA Act defines ‘ordinary time earnings’ as:
(a) the total of:
(i) earnings in respect of ordinary hours of work other than earnings consisting of a lump sum payment of any of the following kinds made to the employee on the termination of his or her employment:
(A) a payment in lieu of unused sick leave;
(B) an unused annual leave payment, or unused long service leave payment, within the meaning of the Income Tax Assessment Act 1997; and
(ii) earnings consisting of over - award payments, shift - loading or commission; or
(b) if the total ascertained in accordance with paragraph (a) would be greater than the maximum contribution base for the quarter --the maximum contribution base.
65 The UGL Agreement provides for the introduction of new rosters based on operational requirements: cl 14.15. Clause 23 of the UGL Agreement required the respondent to consult with employees or their nominated representatives in the event of, amongst other things, a proposal to introduce a change to the regular roster or ordinary hours of work of employees. For proposed changes to regular rosters or ordinary hours of work, the respondent is to comply with subclauses 23.10 to 23.15. Mr Elliott’s evidence, while not expressly referring to cl 23, demonstrated the respondent complied with the clauses when the respondent moved to the 14:14 Roster.
Shift Over Cycle rate
66 Clause 14.8 of the UGL Agreement states:
If an employee is required to work in excess of 10 hours per shift, the employee will be paid the flat Shift Over Cycle rate at Appendix 4(b) for those hours. Shift Over Cycle rates do not attract superannuation as they do not form part of the Ordinary Time Earnings. For example, where the rostered hours are 10 hours per day and an employee is required to work an additional one hour then this one hour shall be paid at the Shift Over Cycle Rate.
67 In addition to cl 14.3 of the UGL Agreement, cl 14.9 and cl 14.13 also refer to Shift Over Cycle rates with cl 14.9 providing another example:
14.9 If an employee is required to work additional days in excess of the normal roster pattern, the employee will be paid the flat Ordinary Hours hourly rate and Overtime Hours hourly rate as applicable at Appendix 2 for those additional days. For example, where the normal roster pattern is 19 days on, 9 days off, 10 hours per day and an employee is required to work on the 20th day for 12 hours, the employee is paid for the flat Ordinary Hours and Overtime Hours hourly rates for 10 hours and is paid the Shift Over Cycle rate for the remaining 2 hours.
14.13 UGL may roster Employees to work shift work and shall give such Employees twenty four (24) hours’ notice of the commencement of a shift or to change from one shift to another. Where such notice is not given, the appropriate Shift Over Cycle Rate will be paid for all time worked until the expiration of the notice period.
68 The payment of the Shift Over Cycle rate is not only referrable to cl 14.8, but also applies to cl 14.13 of the UGL Agreement, which does not tie the payment of the Shift Over Cycle rate to working over 10 hours per shift.
69 Clause 1.1 of the UGL Agreement in the definition of ‘Overtime Hours’ provides that all Overtime Hours (meaning all time worked in excess of Ordinary Hours) is paid at the flat overtime hourly rate of pay in Appendix 2 or 3 or at the Shift Over Cycle rate as applicable. Similarly, cl 8.1.3 provides that casual employees who work in excess of Ordinary Hours shall be paid the applicable flat Overtime Hours Hourly Rate, or Training Rate, or Shift Over Cycle rate, as applicable.
Determination on construction
70 The claimant refers to King in relying upon the words in cl 14.8 of the UGL Agreement to advance its preferred construction of the clause. The primary judge’s decision was overturned on appeal in King v Melbourne Vicentre Swimming Club Inc [2021] FCAFA 123 (King Appeal) with the Full Bench summarising the principles of construction of awards, which also apply to enterprise agreements. It is useful to set out the relevant parts of King Appeal, at [40] - [43], in full:
40. The principles governing the construction of awards are well-established and the primary judge’s exposition of them was not challenged on appeal. The construction of an industrial instrument depends on its language, understood in light of its industrial context and purpose: see Amcor Ltd v Construction, Forestry, Mining and Energy Union [2005] HCA 10; (2005) 222 CLR 241 at [2] (Gleeson CJ and McHugh J). In City of Wanneroo v Holmes [1989] FCA 369; (1989) 30 IR 362 at 378379, French J said (most citations removed);
The interpretation of an award begins with a consideration of the natural and ordinary meaning of its words. The words are to be read as a whole and in context. Ambiguity if any, may be resolved by a consideration, inter alia, of the history and subject matter of the award. Resort to such matters as prefatory statements and negotiations is of dubious assistance if admissible at all. The logs of claim and arbitrator’s reasons for decision may be referred to determine the ambit of the dispute which led to the making of the award so that where there are two possible interpretations, one within the ambit and one without, the former may be preferred. ... That is not to say the words must be interpreted in a vacuum divorced from industry realities. As Street J said in Geo A Bond & Co Ltd (in liq) v McKenzie [1929] AR(NSW) 498 at 503:
it must be remembered that awards are made for the various industries in the light of the customs and working conditions of each industry, and they frequently result ... from an agreement between the parties, couched in terms intelligible to themselves but often framed without that careful attention to form and draughtsmanship which one expects to find in an Act of Parliament. I think, therefore in construing an award, one must always be careful to avoid a too literal adherence to the strict technical meaning of words, and must view the matter broadly, and after giving consideration and weight to every part of the award, endeavour to give it a meaning consistent with the general intention of the parties to be gathered from the whole award.
41. We agree with the primary judge’s observation (at PJ [127]) that:
Practices in the relevant industry may provide material context. An illustration is Transport Workers Union v Linfox Australia Pty Ltd [2014] FCA 829; 318 ALR 54, where Tracey J held that evidence about the morning commencement time of work in the transport industry, together with an examination of the history of relevant award provisions, informed the construction of the term ‘day shift’ with the consequence that ordinary day workers were not to be regarded as shift workers for the purposes of the award, and were therefore not entitled to ‘crib time’.
42. Hence the framers of documents such as awards may well have been more concerned with expressing their intention in a way likely to be understood in the relevant industry rather than with legal niceties or jargon, so a purposive approach to interpretation is appropriate and a narrow or pedantic approach is misplaced: see WorkPac Pty Ltd v Skene [2018] FCAFC 131; (2018) 264 FCR 536 at [197] (Tracey, Bromberg and Rangiah JJ) applying Kucks v CSR Ltd [1996] IRCA 166; (1996) 66 IR 182 at 184 (Madgwick J). An award may be read that way 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’: Kucks at 184.
43. The circumstances may lead the court to conclude that a clause in an award is a product of history; in such circumstances it may be possible to discern the purpose of the award only by reference to its history: see Short v FW Hercus Pty Ltd (1993) 40 FCR 511 at 518 (Burchett J). But there are limits to that; as the primary judge said in the present case (at PJ [128][129]), the texts of modern awards are widely available to members of the public and should be reasonably capable of being understood and implemented by participants in the relevant industry by reference to the language of the award itself, without having to delve into the pedigree of the instrument. That is especially so where, as here, non-compliance with an award can expose a person to pecuniary penalties: see Wanneroo at 380.
71 The difficulty with considering only the words in cl 14.8, without more, is that it risks a constrained construction without regard to the context in which the clause appears and the agreement as a whole.
72 That is, cl 14 and cl 23 of the UGL Agreement contemplate a change in the hours of work. The fact that the change in the hours of work in this case was the consequence of a global pandemic is not to the point. That is, a global pandemic is merely one reason, albeit a reason which was arguably not reasonably foreseeable at the time the agreement was made by the parties, that the respondent could introduce change to the regular roster or ordinary hours of work of employees.
73 Further, the definition of ‘Roster Cycle’ in cl 1 contemplates the roster cycle as it relates to the FIFO or Non-Local roster may be varied via consultation with employees, along with the Rostered Hours or Rostered Shift.
74 The starting point is to determine the minimum working requirement under the UGL Agreement.
75 Full time employees are engaged to work an average of 38 Ordinary Hours per week averaged over a four-week period where Ordinary Hours are defined as 38 hours per week, or 76 hours per fortnight or 152 hours per four-week period. The clear intention associated with the definition, when regard is had to the rostering structures employed in the similar industries, is that FIFO or non-local employees work something other than Monday to Friday with Saturday and Sunday off, but the employer is required to adhere to certain employment standards.
76 However, under the UGL Agreement, consistent with the bargaining and agreement between the bargaining parties, full time FIFO or non-local employees worked and were paid for additional 38 hours worked outside of the Ordinary Hours, referred to as Overtime Hours. The agreed payment for doing so was an all-inclusive rate for all time worked for the Rostered Hours. The Rostered Hours were the Ordinary Hours and Overtime Hours in the Roster Cycle, with the work being rostered 10 hours per day or as amended from time to time.
77 The Roster Cycle is a four-week cycle See cl 1.1 under definition of ‘Roster Cycle’.
, which, relevant to when the UGL Agreement was made, was the 19:9 Roster (with the 18:10 Roster in contemplation) but with the scope to implement a different roster cycle.
78 Thus, the combined effect of the Roster Cycle and the Rostered Hours is a full time FIFO (or non-local) employee was paid for 190 hours consistent with cl 14.4 of the UGL Agreement. This combined Roster Cycle and Rostered Hours was due to change on 30 July 2019 to the 18:10 Roster, however, the proposed change was a reduction in the number of workdays from 19 to 18. The all-inclusive rate remained the same as did the proposed number of working hours per shift.
79 As seen in Appendix 2 of the UGL Agreement, the Ordinary Hour and Overtime Hour rate of hourly pay is the same for full time employees (save for a night shift increase). Appendix 3 of the UGL Agreement shows the same Ordinary Hour and Overtime Hour rate of hourly pay is the same for casual employees.
80 While Overtime Hours are included in the Rostered Hours, the working of unrostered overtime is contemplated in cl 1.1 of the UGL Agreement where all Overtime Hours are paid at the rates specified in Appendix 2 or 3 or at the Shift Over Cycle rate as applicable.
81 Further, where cl 14.8 of the UGL Agreement specifically provides that superannuation does not apply to the Shift Over Cycle rate as the rate does not form part of Ordinary Time Earnings, consistent with s 6(1) of the SGA Act, but it is paid on the all-inclusive rate which includes a component for Overtime Hours Clause 13.2 of the UGL Agreement.
, this supports the Shift Over Cycle rate applying to hours of work undertaken outside of the Rostered Hours in the Roster Cycle.
82 Further, the examples provided in cl 14.8 and cl 14.9, are broadly consistent with the payment of the Shift Over Cycle rate for work undertaken outside of the Rostered Hours in the Roster Cycle, noting that there is no other overtime hourly rate provided. That is, full time employees who work outside of the Rostered Hours in the Roster Cycle are either paid at the all-inclusive rate or at the Shift Over Cycle rate.
83 The use of the words ‘Shift Over Cycle rate’ clearly has meaning in the industry in which the term is used Exhibit 3 at [38].
.
84 When regard is had to the entire agreement taken in context, I find that the payment of the Shift Over Cycle rate applied to work required to be undertaken outside of the Rostered Hours or Rostered Shift in the Roster Cycle.
85 However, what does this mean if there is a change in Roster Hours or Roster Cycle, in particular if there is an increase in Roster Hours over 10 hours?
86 For the Shutdown Roster, cl 14.3 of the UGL Agreement specifies the Shift Over Cycle rate applies to hours worked over 10 hours per day on Shutdowns, which is also consistent with the example in cl 14.9 of the UGL Agreement. However, this example refers to the normal roster pattern being the 19:9 Roster, 10 hours per day.
87 For the following reasons, and notwithstanding the words used in cl 14.8, I find that the Shift Over Cycle rate did not apply to 0.87 hours worked by the Affected Workers, which was over 10 hours:
· the intention to the Shift Over Cycle rate is to compensate employees for something more than overtime, otherwise the payment of unrostered overtime in cl 1.1 at the all-inclusive rate or at the Shift Over Cycle rate as applicable is unnecessary;
· this also accords with cl 14.13 of the UGL Agreement where the Shift Over Cycle rate is, in effect, a penalty rate where the respondent fails to give the notice specified in the clause;
· similarly, the Shift Over Cycle rate compensates employees who are required to work outside the duration of ordinary rostered hours;
· to that end, superannuation does not apply to the Shift Over Cycle rate because it is work required to be done outside of work designated Ordinary Time Earnings;
· therefore, the Shift Over Cycle rate is not intended to further compensate employees for undertaking Ordinary Hours of work;
· the change from the 19:9 Roster to the 14:14 Roster, irrespective of the reason for the change, altered by agreement, as contemplated under the UGL Agreement, not only applied to the Roster Cycle but also applied to the Roster Hours or Roster Shift;
· the effect of the combined change was that FIFO or non-local employees were required to work their minimum 38 Ordinary Hours per week or 152 Ordinary Hours per four week period by working new Roster Hours or Roster Shifts of 10.87 hours per day;
· under the 14:14 Roster the Shift Over Cycle rate contemplated in cl 14.8 did not apply unless an employee was required to work in excess of the 10.87 hours per shift; and
· to find otherwise would make commercial nonsense in that FIFO or non-local employees would be further compensated to do no more than the minimum requirement under the UGL Agreement and would be, arguably, liable to repay to the respondent superannuation paid on 0.87 hours to which they are not entitled.
88 While not determinative, the negotiations surrounding the change to the 14:14 Roster and the hours of work are consistent with the preferred construction. That is, based on the uncontroverted evidence of Mr Elliott, one of the issues occupying the relevant representative union was the ‘underpayment of superannuation’ if employees worked 140 ordinary hours rather than 152 ordinary hours. Given the union involved was also one of the bargaining parties to the UGL Agreement, it is reasonable to infer that the relevant union was aware of cl 14.8 and did not seek to substitute this clause in lieu of the 12 hours of superannuation. Failing the relevant union and the respondent forgetting about cl 14.8, it is also reasonable to infer that cl 14.8 was not invoked because it was always intended to apply to work outside Rostered Hours on the Roster Cycle.
Conclusion
89 I am satisfied, and I find, albeit for different reasons, that the preferred construction of cl 14.8 of the UGL Agreement is consistent with the respondent’s construction, in that the Shift Over Cycle rate did not apply to the 0.87 hours worked by the Affected Workers between the dates identified.
90 Accordingly, I find that the respondent did not contravene cl 14.8 of the UGL Agreement as it relates to the Affected Workers and, therefore, did not contravene s 323 of the FWA.
91 The claimant’s claim is dismissed.



D. SCADDAN
INDUSTRIAL MAGISTRATE



SCHEDULE I: Jurisdiction, Practice and Procedure of the Industrial Magistrates Court (WA)
Jurisdiction
[1] An employee, an employee organization or an inspector may apply to an eligible state or territory court for orders regarding a contravention of the civil penalty provisions identified in s 539(2) of the FWA.
[2] The IMC, being a Court constituted by an industrial magistrate, is ‘an eligible State or Territory court’: FWA, s 12 (see definitions of ‘eligible State or Territory court’ and ‘magistrates court’); Industrial Relations Act 1979 (WA), s 81 and s 81B.
[3] The application to the IMC must be made within six years after the day on which the contravention of the civil penalty provision occurred: FWA, s 544.
[4] The civil penalty provisions identified in s 539 of the FWA include the requirement to pay an employee amounts payable to the employee in relation to the performance of work in full: FWA, s 323(1)(a).
[5] An obligation upon an ‘employer’ covered by an agreement is an obligation upon a ‘national system employer’ and that term, relevantly, is defined to include ‘a corporation to which paragraph 51(xx) of the Constitution applies’: FWA, s 42, s 53, s 14 and s 12. An entitlement of an employee covered by an agreement is an entitlement of an ‘employee’ who is a ‘national system employee’ and that term, relevantly, is defined to include ‘an individual so far as he or she is employed … by a national system employer’: FWA, s 42, s 53 and s 13.
Contravention
[6] Where the IMC is satisfied that there has been a contravention of a civil penalty provision, the Court may make orders for an employer to pay to an employee an amount that the employer was required to pay under the modern award: FWA, s 545(3)(a).
[7] The civil penalty provisions identified in s 539 of the FWA include:
· Failing to pay an employee amounts payable in full in relation to the performance of work: FWA, s 323(1).
[8] An ‘employer’ has the statutory obligations noted above if the employer is a ‘national system employer’ and that term, relevantly, is defined to include ‘a corporation to which paragraph 51(xx) of the Constitution applies’: FWA, s 14 and s 12. The obligation is to an ‘employee’ who is a ‘national system employee’ and that term, relevantly, is defined to include ‘an individual so far as he or she is employed … by a national system employer’: FWA, s 13
[9] Where the IMC is satisfied that there has been a contravention of a civil penalty provision, the Court may make orders for:
· An employer to pay to an employee an amount that the employer was required to pay under the FWA: FWA, s 545(3).
· A person to pay a pecuniary penalty: FWA, s 546.
[10] In contrast to the powers of the Federal Court and the Federal Circuit Court, an eligible State or Territory court has no power to order payment by an entity other than the employer of amounts that the employer was required to pay under the FWA. For example, the IMC has no power to order that the director of an employer company make payments of amounts payable under the FWA: Mildren v Gabbusch [2014] SAIRC 15.
Burden and standard of proof
[11] In an application under the FWA, the party making an allegation to enforce a legal right or to relieve the party of a legal obligation carries the burden of proving the allegation. The standard of proof required to discharge the burden is proof ‘on the balance of probabilities’. In Miller v Minister of Pensions [1947] 2 All ER 372, 374, Lord Denning explained the standard in the following terms:
It must carry a reasonable degree of probability but not so high as is required in a criminal case. If the evidence is such that the tribunal can say: ‘We think it more probable than not,’ the burden is discharged, but, if the probabilities are equal, it is not.
[12] In the context of an allegation of the breach of a civil penalty provision of the Act it is also relevant to recall the observation of Dixon J, said in Briginshaw v Briginshaw [1938] HCA 34; 60 CLR 336:
The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters ‘reasonable satisfaction’ should not be produced by inexact proofs, indefinite testimony, or indirect inferences. (362)

SCHEDULE II: Construction of Industrial Instruments
[1] This case involves, in part, construing industrial agreements. The relevant principles to be applied when interpreting an industrial instrument are set out by the Full Bench of the Western Australian Industrial Relations Commission in Fedec v The Minister for Corrective Services [2017] WAIRC 00828; 97 WAIG 1595 [21] - [23].
[2] In summary (omitting citations), the Full Bench stated:
The general principles that apply to the construction of contracts and other instruments also apply to the construction of an industrial agreement;
(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’;
(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; and
(7) Industrial agreements are usually not drafted with careful attention to form by persons who are experienced in drafting documents that have legal effect.
[3] The following is also relevant:
· Ascertaining the intention of the parties begins with a consideration of the ordinary meaning of the words of the instrument. Ascertaining the ordinary meaning of the words requires attention to the context and purpose of the clause being construed. City of Wanneroo at [53] - [57] (French J).
· Context may appear from the text of the instrument taken as a whole, its arrangement and the place of the provision under construction. The context includes the history of the instrument and the legal background against which the instrument was made and in which it was to operate. City of Wanneroo [53] - [57] (French J); Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Excelior Pty Ltd [2013] FCA 638 [28] - [30] (Katzmann J).