Federated Engine Drivers’ and Firemens’ Association of Australasia Queensland Branch Union of Employees v Vassallo Constructions Pty Ltd [2002] QIRC 128 (2002) 171 QGIG 7

6 September, 2002 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 7 ########################################################################################################################### QUEENSLAND INDUSTRIAL RELATIONS COMMISSION Industrial Relations Act 1999 – s. 278 – unpaid wages Federated Engine Drivers’ and Firemens’ Association of Australasia Queensland Branch Union of Employees AND Vassallo Constructions Pty Ltd (No. W197 of 2001) COMMISSIONER ASBURY 23 August 2002 Industrial Relations Act 1999 s. 278 – Application for unpaid wages – Leave sought to amend application to include claim for redundancy payments – Issue subject of amendment arising during cross-examination of respondent’s witnesses – Commission required to act in a judicial manner and afford natural justice to parties – Case law in relation to judicial fairness – Amendment to application late in proceedings would be unfair to the respondent – Leave to amend the application refused – Applicant at liberty to make further application for redundancy payments – Civil Construction, Operations and Maintenance General Award – State – Clause 3.5(3) wet weather – Standing down of employees – Industrial Relations Act 1999 s. 98 – History of legislative provisions dealing with rights of employers to stand-down employees without pay – Interaction between s. 98 of the Industrial Relations Act 1999 and clause 3.3(3) of the Civil Construction, Operations and Maintenance General Award – State – Rights of employers to stand employees down due to wet weather not entirely removed by s. 98(2) of the Industrial Relations Act 1999 – Consideration of requirements for stand-down of employee to be permissible under s. 98 of the Industrial Relations Act 1999 – Case law in relation to standing down employees without pay – Onus on employer to establish that stand-down in particular circumstances was permissible under s. 98 of the Industrial Relations Act 1999 – Stand-down of employee in this case not permissible under s. 98 of the Industrial Relations Act 1999 – Flexi-time system implemented by respondent not permissible under the Civil Construction, Operations and Maintenance General Award – State or the Family Leave Award – Employer made and employee accepted payment in lieu of annual leave – Breach by both employer and employee of clause 5.1(3) of the Civil Construction, Operations and Maintenance General Award – State – Employee not entitled to claim benefit for breach of Award – Application granted in part – Respondent to pay employee for stand-downs during periods of wet weather – Offset granted for payment made for annual leave and sick leave – No offset for leave loading or flexi-time. DECISION The application This is an application under s. 278 of the Industrial Relations Act 1999 (the Act) by the Federated Engine Drivers’ and Firemens’ Association of Australasia, Queensland Branch, Union of Employees (FEDFA) on behalf of Mr Allen Sommerfield (the employee). The application seeks an order for unpaid wages in the amount of $10,288.40 against Vassallo Constructions Pty Ltd (the respondent). Mr Price represented the FEDFA. The respondent was represented by Mr Joy of the Queensland Chamber of Commerce and Industry Limited, Industrial Organisation of Employers (QCCI). The application was heard on 9 May 2002. Submissions were made in writing by the FEDFA on 22 May 2002 and for the respondent, on 31 May 2002. Submissions in reply were received from the FEDFA on 7 June 2002. The FEDFA claims the amounts of: $ 705.00 – unpaid meal allowances when overtime was worked by the employee; $3,280.00 – for periods when the employee was stood down; and $4,145.34 – for annual leave and loading; Leave to amend the application The application in its original form, did not include a claim for redundancy payments. The matter of redundancy payments arose during cross- examination of the respondent’s witness, and in submissions the FEDFA sought to amend the application to include a claim of $2,158.06 for redundancy payments. The grant of leave to amend the application was opposed by QCCI on behalf of the respondent. Mr Joy contended that it was not known that this claim would be made until the hearing of the application, and as a result of the amendment being sought after the respondent’s witnesses had given their evidence in chief, the respondent was unable to provide instructions or to call evidence in relation to this point. In my view, there is the additional difficulty, that there was no evidence from the employee about the matter of redundancy payments. It is true that the Commission is not strictly bound by the rules of evidence, but rather must perform its functions in a way that furthers the objects of the Act, avoids -- 1 of 9 -- QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 6 September, 2002 8 unnecessary technicalities and facilitates the conduct of proceedings (s. 173(2)). It is also true that s. 329 of the Act provides wide procedural powers including the power under s. 329(d) to allow claims to be amended. However, that power is to be exercised in a manner which appears to be fair and just. Members of the Commission are required to act in a judicial manner and the principles of natural justice are applicable to hearings before the Commission: R v The Commonwealth Conciliation and Arbitration Commission and others; Ex parte Angliss Group (1969) 122 CLR 546; Re: Australian Bank Employees Union; Ex parte Citicorp Australia Limited (1989) 167 CLR 513. The term “natural justice” in the context of administrative decision making can be equated to an obligation to act fairly or to accord procedural fairness. The requirements of natural justice or procedural fairness are not fixed and in any given situation, depend on the circumstances: Mobil Oil Australia Pty Ltd v Federal Commissioner for Taxation (1963) 113 CLR 475 at 504 per Kitto J: The High Court in Re: Australian Bank Employees Union; Ex parte Citicorp Australia Ltd (1989) 167 CLR 513 at 519, pointed out that one aspect of the duty to act judicially is the duty to hear a party and allow that party a reasonable opportunity to present a case. Further, the duty to act judicially includes a duty to consider the cases put by parties. It follows that the provision to parties of an opportunity to present their cases, requires that they be given notice of the time and place of a hearing, and the issues to be considered. An application should provide information about the case to be met by the respondent: R v North; Ex parte Oakey [1927] 1 KB 491 at 502 per Scrutton LJ. In P&J Trucking Pty Ltd v Toll Transport Pty Ltd t/a Toll Logistics, (2001) 166 QGIG 434 at 437, Blades C highlighted the importance of proper pleadings in applications under s. 276 of the Act. In my view, the comments made in that decision are equally applicable to applications under s. 278, which typically involve claims based on the application of award or legislative provisions to particular facts and circumstances. To permit late claims to be made in such cases, particularly during submissions, is like a “trial by ambush”. Further, in this case, the lateness of the claim made it impracticable to stand the matter over to enable an appropriate response to be formulated and necessary evidence called. In the circumstances, it would be unfair to the respondent if the FEDFA were allowed to pursue the matter of redundancy payments in these proceedings. I decline leave for the FEDFA to amend the application in respect of the claim for $2,158.06 for redundancy payments. I note that this does not preclude the pursuit of the claim for redundancy payments on behalf of the employee by way of a separate application. Matters Conceded by the Parties Prior to or During Proceedings It appears that the respondent conceded the aspect of the claim in relation to meal allowances, prior to the commencement of the hearing into the application. Rather than formally advising of this concession, Mr Joy of QCCI forwarded a number of pieces of correspondence between himself and Mr Price offering to settle this aspect (and other aspects) of the claim, to the Commission. Mr Joy persisted in copying correspondence between himself and Mr Price to the Commission, notwithstanding my specific advice at a directions hearing on 17 April 2002, that this was inappropriate. On a number of occasions, Mr Joy attached correspondence to Mr Price detailing offers of settlement, to material forwarded to the Commission in response to the Directions Orders for the conduct of the application. This caused great difficulty, as I was required to disregard the correspondence detailing settlement offers, while attempting to extract relevant information, such as witness statements required by the Directions Orders, from that correspondence. During the hearing of this matter it appeared that witnesses for the respondent conceded that the provisions of the Award with respect to the payment of meal allowances when overtime was worked had been misapplied. The FEDFA claim for meal allowances was also reduced due to a miscalculation in relation to the payment of meal allowances for overtime worked on Saturdays. In the submissions filed by QCCI for the respondent, no mention is made of meal allowances. Accordingly, I have concluded that this aspect of the claim has been conceded by the respondent, and that an order for the amount of $705.00 with respect to this aspect of the application should be made against the respondent. Further, during the hearing of this matter, Mr Joy for the respondent appeared to concede that the employee was entitled to be paid for any day when he had reported to work and held himself in readiness to perform work, but had been sent home by a supervisor or manager of the respondent due to wet weather. That this concession is made can also be deduced from the rather convoluted written submissions of Mr Joy for the respondent. Suffice to say that the hearing and determination of this application could have been significantly streamlined, if Mr Joy had complied with the directions issued by the Commission at a preliminary hearing of the application on 17 April 2002, to the effect that the respondent was to file a formal response to the application, and that instead of inappropriately relaying offers of settlement to the Commission, should formally concede any aspects of the claim which were not contested. During the hearing into the application, Mr Price conceded that the claim was not pressed for payment with respect to days when the employee had been absent on paid sick leave, as evidenced by pay slips tendered by the respondent. The Facts There are a number of facts upon which the parties agree (or which were not contested by the respondent). The employee was employed by the respondent under the terms of the Civil Construction, Operations and Maintenance General Award – State (the Civil Construction Award) as an Excavator Operator classified at Level CW7. The employee was employed by the respondent from May 1999 to 6 February 2001. (The employee said in his witness statement that he commenced employment on 25 May 1999, but the first entry in the time docket book used by the employee is dated 5 May 1999). The respondent’s business was impacted from time to time, by the occurrence of wet weather, which would lead to situations where the respondent decided that work could not be performed because of that wet weather. When the respondent formed such a view, the employee would be stood down without pay. There is conflicting evidence about how such a stand-down would be effected. For the respondent it was contended that employees were contacted by telephone and told not to come to work, or alternatively, had a standing instruction during extended periods of wet weather, to contact their supervisor each day, to ascertain whether work was available. The employee on the other hand, contended that there was only one occasion when he was contacted by a supervisor of the respondent and told not to report for work, and approximately two occasions when he had contacted a supervisor and been told not to report for work. On all other occasions the employee said that he had reported for work each day for which a claim for payment was made, and held himself in readiness to perform work. To enable employees to maintain 38 hours payment for any week in which wet weather occurred, the respondent established a system where time worked in excess of forty hours per week was accumulated or “banked” and employees were paid banked time during periods where the respondent determined that work could not be performed because of wet weather. This time was referred to by the respondent as “flexi-time”. Initially, the employee agreed to bank overtime and to access that time as flexi-time during periods when work was not available, due to wet weather. This agreement was oral. At some point during the employee’s employment, he requested payment at overtime rates for work in excess of forty hours per week. When the employee’s banked hours had been exhausted, the employee accessed accrued annual leave, to cover periods of wet weather when the respondent determined that work could not be performed. -- 2 of 9 -- 6 September, 2002 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 9 The employee kept a series of time docket books covering the period from 30 April 1999 to 6 March 2001. These books have the respondent’s business name and contact details printed on each docket. The employee used the dockets to record days upon which he performed work and days when he claimed to have been stood down due to wet weather. The respondent did not produce any other time and wages records to the Commission. The respondent did produce a number of pay slips which had been provided to the employee, indicating that he was absent on annual leave or sick leave, or was paid “flexi-time”, on a number of days for which he was now claiming payment on the basis of the contention that he had been stood down due to wet weather. The Issues for Determination The FEDFA claim is based on the assertion that the employee was entitled to be paid for all time lost due to wet weather, provided that the employee met the requirements of clause 3.5(3) of the Civil Construction Award. The FEDFA maintains that the employer did not have the right to stand the employee down without pay for the reason that work was unable to be performed due to wet weather and claims payment for such stand-downs. It was also contended by the FEDFA that the employer’s system of flexi-time was outside the provisions of the Award, and that the employee was entitled to be paid at ordinary rates, for periods when he was stood down due to wet weather. Accordingly, the use by the respondent of a system of flexi-time to provide payment to the employee for periods when he was stood down, did not meet the respondent’s obligations to pay the employee for ordinary time lost due to wet weather. Further the employee accessed annual leave payments only to avoid being stood down without pay for periods of wet weather, and was not on annual leave. The employee was therefore entitled to reimbursement of annual leave payments including leave loading, used to cover periods when he would not otherwise have been paid, due to the actions of the respondent in standing him down, because of wet weather. For the respondent, it was contended that on many of the days for which payment was claimed by the employee, he was absent on sick leave or annual leave, and was not subject to a stand-down. Further, it was contended that the respondent had the right at all times to determine that work was unable to be performed due to wet weather on a particular day, and to advise employees prior to them reporting for work on that particular day, that work was not available due to wet weather, and that they were to be stood down without pay for that particular day. The respondent maintains that on a number of occasions during the period subject to the claim, the employee reported for work after having been lawfully directed not to do so, and is not entitled to payment for any day upon which this occurred. The manner in which this case was argued has made the identification of the issues for determination difficult. However, in my view they are as follows: 1. What right did the respondent have to stand the employee down without pay for the reason that work was unable to be performed due to wet weather? 2. If the respondent had the right to stand the employee down for the reason that work was unable to be performed due to wet weather, did the Civil Construction Award operate to require the employer to pay the employee for the period he was stood down for this reason? 3. If the respondent had the right to stand the employee down without pay for the reason that work was unable to be performed due to wet weather, was the right exercised in a manner which was permissible under the legislative or award provision from which the right was derived? 4. Were the payments of flexi-time and annual leave made to the employee by the respondent sufficient to meet any legislative or award obligations which the respondent may have had to pay the employee during periods when the employee was stood down due to wet weather? Legislative and Award provisions The FEDFA’s case depends on the operation of the provisions of the Act and the Civil Construction Award with respect to payment for periods during which employees are stood down. The provisions of the Act dealing with this matter are contained in s. 98, in the following terms: “98. Permissible stand-down of employee (1) An employer may stand-down an employee on a day, or for part of a day, when the employee cannot be usefully employed because of something that happened – (a) for which the employer is not responsible; or (b) over which the employer has no control. (2) The employer may stand-down the employee without pay, unless an industrial instrument provides otherwise. (3) This section does not apply to an apprentice or a trainee.”. The Civil Construction Award provides as follows at clause 3.5(3): “(3) Wet Weather – subject to the stand-down provisions contained within section 11.5 of the Industrial Relations Act 1990-1991, all time lost through wet weather shall be paid for, provided the employees turn up on the work and hold themselves in readiness. The supervising officer or other person under whose direction the employees are working shall decide whether or not it is too wet to work. Waterproof Clothing – Employees who are compelled to work in rain shall be supplied with oilskin coats or other suitable covering. When employees are prevented by wet weather from following their usual avocation, unless the employees are willing to undertake training as directed by the employer or to perform during such wet weather any work the employer may direct them to do they shall not be entitled to payment for such time lost. When an employee is required to perform work in the rain and by doing so gets wet clothes, the employee shall be paid double rates for all work so performed. Such payment shall continue until such time as the employee finishes work or is able to change into dry clothing: Provided that employees entitled to payment under this clause shall not be entitled to payment under subclause 21 of this clause.”. Subclause 21 of clause 3.5 provides allowances for employees working from a swing scaffold. In all probability the Civil Construction Award contains a typographical error, and the intention is that employees will not be entitled to payment under clause 23 – Wet Places when they are being paid additional rates for working in the rain. However, this proviso is not relevant to the matter I am required to determine. The Act, in its various manifestations, has provided for employees to be stood down without pay in similar circumstances to those currently provided for in ss. 98(1)(a) and (b). The Industrial Conciliation and Arbitration Act 1961–1987 provided at s. 21A(1) that notwithstanding anything in that Act or in -- 3 of 9 -- QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 6 September, 2002 10 any award or industrial agreement, an employer could stand-down an employee without pay, for any day or part of a day on which the employee could not be usefully employed because of the occurrence of anything for which the employer was not responsible or over which the employer had no control. Section 11.5 of the Industrial Relations Act 1990 (which is referred to in clause 3.5(3) of the Civil Construction Award) was in almost identical terms to the previous s. 21A(1). Following further amendments to the Industrial Relations Act 1990 stand-down provisions were contained in s. 224. That section was in almost identical terms to the former provisions, except that reference to certified agreements and enterprise flexibility agreements was included, so that the Act provision operated notwithstanding the provisions of awards and the various forms of agreement which then existed. The provisions with respect to stand-downs subsequently appeared in the Workplace Relations Act 1997 at s. 231, as follows: “Permissible stand-down of employee 231.(1) An employer may stand-down an employee without pay on a day, or for part of a day, when the employee can not be usefully employed because of something that happened – (a) for which the employer is not responsible; or (b) over which the employer has no control. (2) This section applies despite another provision of this Act or an industrial instrument; (3) This section does not apply to an apprentice or a trainee.”. In relation to s. 21A of the Industrial Conciliation and Arbitration Act 1961-1983, then President of the Industrial Court of Queensland, His Honour Justice R. H. Matthews in The Australian Workers’ Union of Employees, Queensland v Mt Isa Mines Limited (1983) 114 QGIG 41, considered a situation where an award contained a stand-down provision introduced before the enactment of s. 21A, which was inconsistent with that section. His Honour held that: “The Award has the force of law (section 29(1)(b) of the Act) but, whether considered from the point of view of inconsistency or variation, is necessarily limited by the Act provisions. The two sets of provisions are not wholly inconsistent, but it is obvious that they may become inconsistent in their application to particular cases and the Act, not only because of its overriding legislative effect is to be given operation, but also because of the more recent enactment of it; (cf. Goodwin v Phillips (1908) 7 CLR 1 per Griffiths CJ at p. 7).”. It will be noted that this is no longer the case. The principal point of difference between s. 98 of the current Act and s. 231 of the former Workplace Relations Act 1997, is the impact of an inconsistent provision of an award or industrial instrument on the right of the employer to stand the employee down without pay. The current Act, (as did its 1997 and 1990 predecessors) provides at s. 344 for an appeal against a stand-down under s. 98, to be made to the Commission. Given that the FEDFA’s case was that s. 98 did not have application because the Award dealt exclusively with wet weather stand-downs, s. 344 of the Act was not addressed by the applicant. However, despite the fact that the respondent’s case was that s. 98, had some application in this case, Mr Joy’s submissions completely ignored s. 344 and the question of whether the application should have been brought under that section. The application by the FEDFA was brought under s. 278 of the Act. After giving consideration to this matter, I have determined to deal with this application under s. 278 for the following reasons. Section 344 provides that an employee who is stood down may appeal to the Commission either during the period of the stand-down or subsequently. There is no indication that s. 344 is the only mechanism by which an employee may seek payment of wages for periods during which the employee was stood down without pay. In this case, the FEDFA is claiming that annual leave to cover periods during which the employee was stood down should be re-credited, and that the respondent has incorrectly applied the provisions of the Civil Construction Award with respect to the method for working a 38 hour week and payment of overtime. In my view, these are equally matters which might be dealt with by way of an application seeking an order for unpaid wages, under s. 278. The operation of the Act and Civil Construction Award provisions with respect to wet weather stand-downs The case for the FEDFA relied on clause 3.5(3) of the Civil Construction Award contending that it requires all time lost through wet weather to be paid. Mr Price for the FEDFA argued that this is a positive statement, which removes the capacity of employers to stand-down employees under the Civil Construction Award without pay, for the reason that work is unable to be performed due to wet weather. The FEDFA also relies on s. 98(2) of the Act, which provides that the right of an employee to stand-down an employee without pay, operates subject to the provisions of an award. It was contended by the FEDFA that the combined effect of clause 3.5(3) of the Civil Construction Award, and s. 98(2) of the Act, is to remove the rights of employers to stand-down employees covered by the Award, when work is unable to be performed due to wet weather. Mr Price argued that this is the case even where the employer advises the employee prior to the commencement of work, that work is not required due to wet weather. In support of this proposition, Mr Price referred to the decision of Bloomfield C in AMIEU v McClymonts Holdings Pty Ltd (2001) 167 QGIG 253 where it was noted that s. 98(2) of the Act is in different terms to predecessor legislation (at 254), and that “the employer’s statutory right to withhold payment is defeated if an industrial instrument provides otherwise.”. It was also argued by Mr Price that the respondent did not have the right at common law to stand the employee down without pay, during periods when he could not be usefully employed. The respondent’s argument on the other hand was directed at demonstrating that s. 98 of the Act still had some application to standing down employees. The argument appeared to be that if the right to stand employees down existed under the Act, that the employee in this case would not be entitled to payment for any full day upon which he was stood down. In this regard, Mr Joy for the respondent put a somewhat convoluted argument about the interaction between s. 98 of the Act and clause 3.5(3) of the Civil Construction Award. Essentially, the argument was that notwithstanding s. 98(2) of the Act, s. 3.5(3) of the Civil Construction Award provides that it operates subject to the provisions of the Act with respect to stand-downs. This means that the right to stand employees down without pay under the Act is still available, and the Civil Construction Award does not totally override the Act. Mr Joy argued that the combined effect of the Civil Construction Award provision, requiring that employees are to be paid for time lost through wet weather, subject to turning up to work and holding themselves in readiness for work, and s. 98(2) of the Act, is that the employer is not permitted to use the provisions of s. 98(2) of the Act to stand an employee down for part of a day. Mr Joy argued that by virtue of the Award provision dealing with stand-downs operating subject to the provisions of the Act, that the employer retained the right to notify employees prior to the commencement of work, that they were to be stood down without pay, due to wet weather. -- 4 of 9 -- 6 September, 2002 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 11 Accordingly, the respondent was entitled to determine that work was not possible due to wet weather, and to issue an instruction to employees on the preceding day, not to report for work. Such an instruction would constitute a lawful direction, and any employee who had wilfully failed to comply, would not be entitled to payment. In my view, the starting point for the determination of this issue, is s. 98 of the Act. That section establishes the right of an employer the right to stand an employee down on a day or part of a day, when the employee cannot be usefully employed. That right is subject to something happening necessitating the stand-down, for which the employer is not responsible, or over which the employer has no control. Section 98(1) does not give the employer the right to withhold payment from the employee for the period of the stand-down. (c.f s. 231(1) of the previous Workplace Relations Act (1997) which provided for the right to stand an employee down without pay). The right for the employer to withhold payment from the employee for the period of the stand-down, is now found under s. 98(2). By virtue of s. 98(2) the employer may not withhold payment from an employee stood down under s. 98(1), when an industrial instrument provides for payment, in the circumstances which give rise to the stand-down. The difficulty that I have with the arguments in this case, is that the FEDFA contends that clause 3.5(3) deals with the stand-down of employees when work is unable to be performed during periods of wet weather, to the exclusion of the provisions of s. 98 of the Act. The QCCI contends that the Civil Construction Award deals with stand-downs for part of a day, to the exclusion of s. 98(2) of the Act, but that s. 98(2) applies to stand-downs for full days. In my view, neither argument is correct. Clause 3.5(3) of the Civil Construction Award does not deal with stand-downs, but rather the circumstances in which employees must be paid for periods when they are stood down. Similarly, s. 98(2) deals only with payment for a period when an employee is stood down, and provides that employees must be paid when an industrial instrument requires payment in the circumstances in which the employee is stood down. In this regard, I agree with the decision of Bloomfield C who held in AMIEU v McClymonts Holdings Pty Ltd (2001) 167 QGIG 253 that: “Section 98 of the Act deals with an employers right to withhold payment to an employee – who is otherwise ready willing and able to work – if certain conditions are met. It thus overrides an employee’s common law right to be paid whilst s/he is ready willing and able to work (see “The Law of Employment” Macken, O’Grady and Sappideen, 4th Edition, p. 159-160). By virtue of s. 98(2) the employer’s statutory right to withhold payment is defeated if an industrial instrument provides otherwise. For that to occur, the industrial instrument, in my view, would need to specifically and intentionally deal with the matter of payment in circumstances which would otherwise permit the employer to stand employees down.”. The right to stand an employee down, is still found within s. 98 of the Act and not in clause 3.5(3) of the Civil Construction Award. In my view, this case was not about the right of the respondent to stand the employee down in the circumstances which occurred. The respondent had the right to stand the employees down under s. 98(1) of the Act for any reason, including the occurrence of wet weather, provided that the conditions in subsections (a) and (b) were met. The real issue in this case, is whether the industrial instrument applicable to the employee provided an entitlement to payment, in the circumstances under which the employee was stood down. To resolve this question, consideration must be given to the terms of the Civil Construction Award, and whether the employee had the right to be paid under that Award for the period where the respondent stood him down without pay. Clearly, in circumstances where an employee covered by the Civil Construction Award reports to work or commences work on a particular day, and is prevented from working by wet weather, clause 3.5(3) of that Award entitles the employee to be paid for that day, provided that the other conditions in the clause are met. The Civil Construction Award therefore provides otherwise than s. 98(2) of the Act. Thus, notwithstanding that the employer may have the right to stand the employee down under s. 98(1) of the Act, the employee is entitled to payment for the period of the stand-down, by virtue of the combined operation of s. 98(2) and clause 3.5(3) of the Civil Construction Award, provided that the conditions in clause 3.5(3) are met. If employees hold themselves in readiness to perform work, and a supervisor decides that it is too wet to work, and does not require the employees to undertake training or alternative work, they will be entitled to payment for the remaining ordinary hours work which would, but for the occurrence of wet weather have been performed on the day in question. I am also of the view, that an employer could not avoid payment by simply doing nothing, when employees turned up ready to work, or by failing to have a supervisor present to provide direction to employees. The fact that an employer does not exercise its rights under clause 3.5(3) to determine whether or not work can be performed, or to provide alternative work or training, will not mean that an employee who is ready to work, will become disentitled to payment. The additional question which arises in this case, is whether, as the FEDFA submits, clause 3.5(3) of the Civil Construction Award precludes an employee from being stood down in circumstances where the employer notifies of the stand-down due to wet weather, prior to the employee reporting for or commencing work. I am unable to accept this submission. When clause 3.5(3) is considered as a whole, it is clear that what Mr Price referred to as the “positive statement” that all time lost through wet weather shall be paid for, is subject to the provisos which I have referred to above. Further, clause 3.5(3) is to operate subject to the stand-down provisions in the Act. At first glance, it appears that this is a circular argument, in that clause 3.5(3) of the Civil Construction Award operates subject to the stand-down provisions in s. 98 of the Act, and s. 98(2) of the Act makes the stand-down provisions of the Act subject to clause 3.5(3) of the Award. On closer examination, this is not the case. As I have stated above, clause 3.5(3) of the Civil Construction Award does not give employers the right to stand-down employees without pay for any reason, including wet weather. The right to stand employees down without pay does not exist at common law. Rather, to the extent that the right to stand employees down without pay exists, it is established by s. 98(1) of the Act. The effect of clause 3.5(3) of the Civil Construction Award is to give employees stood down under the Act, due to wet weather, the right to be paid, when the conditions in clause 3.5(3) are met. Otherwise, clause 3.5(3) of the Award does not have any application in circumstances where employees are stood down pursuant to s. 98 of the Act. In my view, the rights of the employer to stand employees down without pay under ss. 98(1) and (2) of the Act, in situations where work is not able to be performed due to wet weather, are not entirely displaced by clause 3.5(3) of the Civil Construction Award. The right of an employer not to pay an employee stood down under s. 98 of the Act, is only displaced to the extent that it does not apply when the circumstances in s. 3.5(3) are met. Employers are still entitled under ss. 98(1) and (2) of the Act to stand-down employees covered by the Civil Construction Award, without pay, by determining that work is not available due to wet weather, or for some other reason beyond the employer’s control, and advising employees of this prior to them reporting to site. This does not mean that employers have carte blanche to stand-down employees whenever it rains. There is no over-arching right at common law to stand an employee down without pay, when the employee cannot be usefully employed. It should be noted that s. 98(1) of the Act imposes obligations upon employers before the right to stand-down employees is exercised, and employees have rights to challenge the validity of the stand-down. When an employee claims payment for a period when the employer purported to stand the employee down, the onus is on the employer to establish that the stand-down was permissible in terms of s. 98 of the Act. -- 5 of 9 -- QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 6 September, 2002 12 The difficulty I have in this case, is that the focus on behalf of the respondent has been directed to establishing that s. 98 of the Act applied to the circumstances in which the employee was stood down, and has not focused on the equally important question of whether the stand-down was effected in a manner and for the reasons permitted by that section. Case law in relation to standing down employees under the Act The circumstances where a stand-down will be permissible under the Act (and its earlier manifestations) have been well established. While much of the case law relates to s. 21A of the Industrial Conciliation and Arbitration Act 1961-1987, much of it is still relevant to the current provisions of the Act, notwithstanding the amendment reflected in s. 98(2). A very useful discussion of the case law relating to stand-downs can be found in Hall and Watson, Industrial Laws of Queensland Second Edition, (Government Printer Queensland 1998). As pointed out by the authors of that publication, the case law establishes that an employee stood down is entitled to have his or her individual circumstances considered and not to be treated as part of a “bloc” in determining whether a stand-down in particular circumstances was permissible: The Australian Workers’ Union of Employees v Cattle Creek Co-operative Sugar Milling Association Limited (1987) 125 QGIG 891. It has also been held that in order to determine whether useful work is available, the employer must first determine whether there is work which would occupy the particular employee on the day in question, and then whether that work would be of net benefit to the employer’s business: Federated Clerks Union of Employees v Mary Kathleen Uranium Ltd (1980) 104 QGIG 5. In that decision at 104 QGIG 6, a Full Bench of the Commission noted: “The evidence in this case is that the employer continued the clerks in employment for some time after the production unions went on strike and that before making a decision [to stand-down employees] the employer caused heads of departments and supervisors to investigate and report on whether useful work was available to the clerks. In our opinion, a decision of that nature is one which should not be set aside unless the adjudicator is satisfied that the decision was capricious or one which was not substantiated by the facts.”. Case law also establishes that “gainfully” and “usefully” are not synonymous, but the distinction is very fine. In this regard, in The Australian Workers’ Union of Employees, Queensland v Mt Isa Mines Limited (1983) 114 QGIG 41 at 42 the then President of the Commission, His Honour Justice Matthews, said: “Both ‘gainfully’ and ‘usefully’ in the context necessarily refer to the business of the employer. ‘Gainfully’ to my mind introduces the concept of profit to the employer, whilst ‘usefully’ is more general in its scope but still carries with it the idea that some sort of advantage for the employer is possible.”. The financial position of the employer is relevant to the determination of whether the employee can be usefully employed: The Australian Workers’ Union of Employees v Cattle Creek Co-operative Sugar Milling Association Limited (1987) 125 QGIG 891 at 893. Were the stand-downs permissible? The FEDFA contends that the employer purported to stand the employee down without pay on each of the days listed in the last schedule to the application, some 63 in total (disregarding the occasions upon which the employee was stood down for part of a day). The evidence of the employee was that on each of those days, he reported for work and he was ready. The employee said that on some occasions he was sent home by a supervisor, and on other occasions, there was no supervisor on site to provide any direction to him. Under cross-examination, and in response to questions from the Commission, the employee maintained that there was only one occasion when he had been contacted by a manager of the respondent and told not to come to work due to wet weather. Further there were only two occasions when he had contacted the respondent before reporting to work, and been told not to report for work due to wet weather. The employee maintained that on all other occasions he had reported to work ready to perform work. Even on days when he had subsequently used annual leave to obtain payment because of being stood down by the respondent, the employee maintained that he had reported for work, and been ready to work. It was submitted by Mr Price that the respondent had not put any evidence before the Commission to contest the employee’s assertion in this regard, and the employee’s evidence should be accepted. Further, there was no evidence that the employee had been subject to any direction about alternative work or training, or that the employee had refused to comply with such a direction. Very little evidence about the circumstances in which the employee was stood down was called by the respondent. Indeed much of the evidence in this regard, was in response to questions from me, rather than being elicited during evidence in chief. Further, the evidence that was put before the Commission consisted of general statements about what would have happened, rather than what actually did happen, on days when the employee was stood down. Essentially the evidence of Mr and Mrs Vassallo was that the employee should have known that in extended periods of wet weather, work would not have been available for him, and that this was “common sense”. Further, the employee should have known that he was required to contact his supervisor in the event of wet weather, prior to reporting to work, to establish whether work was available on each day when wet weather occurred. There was no direct evidence to counter the employee’s contention that he had reported to work on each day for which payment was claimed. The evidence for the respondent in this regard was limited to Mrs Vassallo stating under cross-examination, that on many of the days when the employee claimed that he had shown up at the work-site, there would have been no-one there to send him home. Mr Vassallo also said that most employees would not have shown up, and that Mr Sommerfeld may have read the Award, known of the provisions about wet weather and turned up at site simply to claim payment. Mr Vassallo said under cross-examination, that occasionally he would have been at a site where the employee was working, “probably more not than so”, and could not vouch for whether the employee had turned up for work every morning. No direct evidence was called from either Mr or Mrs Vassallo about the process that was used to establish that no useful work was available due to the occurrence of wet weather on each of the days for which payment was claimed. Further there was no evidence upon which I could be reasonably satisfied that no useful work was available on days when the employee was stood down due to wet weather. In this regard evidence might have been called to establish matters such as: • the size of the respondent’s operations; • the type of work performed by the respondent; • procedures which the respondent had in place and had clearly articulated to employees about how stand-downs in the event of wet weather would be effected; • that a supervisor of the respondent contacted the employee on all or even some of the days for which payment was claimed to advise him that work was not available on that day; • the sites upon which the respondent was performing work on days when the employee was stood down; • the nature and extent of the wet weather on those days; • the process which was followed by the respondent in determining that work could not be performed on the days in question; -- 6 of 9 -- 6 September, 2002 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 13 • the availability of alternative work such as maintenance; and • the capacity of the respondent to provide such alternative work. The only “evidence” before the Commission about any of these matters was put by Mrs Vassallo in response to questions from me. There was a lack of clarity and certainty about Mrs Vassallo’s answers to these questions, and I did not find those answers particularly compelling. The respondent in this case was facing a substantial claim by the employee involving a significant amount of money. The claim identified each day upon which the employee claimed to have been stood down without pay, in a manner which was not permissible. The respondent’s defence to the claim was that s. 98 of the Act applied to the standing down of the employee. On the respondent’s own case, the respondent carried the onus of demonstrating that the standing down of the employee in the circumstances in which it occurred was permissible. The respondent has not met that onus. Mr Joy raised a number of matters in his submissions about the location of one particular site at which the respondent was working and the improbability of him having transported himself to that site on the days for which payment was claimed. It was further contended by Mr Joy that the employee had failed to prove that he had turned up on site on each of the days for which payment was claimed, and that a person with authority to act on behalf of the respondent, had sent him home, and that “considerable weight should apply to that deficiency.”. Later in the submission, Mr Joy stated that the evidence showed that mostly, there would have been no person with authority to act on behalf of the respondent and to instruct employees to go home, present on site on wet days, and made the following submission about the conduct of the employee and his evidence: “The applicant clearly admitted that he was aware of his instructions, being not to turn up on the job, but to ring to see if work was possible. He stated that he specifically chose to contravene that instruction, in order to create a liability on the employer to pay for such days on the basis that the Award says ‘all time lost through wet weather shall be paid for provided that employees turn up on the work and hold themselves in readiness.”. I reject those submissions, on the basis that the evidence did not demonstrate any of the matters contended by Mr Joy, and the employee made no such admission. Quite simply, there was no evidence about the sites the employee was working on or where they were located. There was no evidence from supervisors or other employees about the practices of the respondent when wet weather occurred. More significantly, the matters raised in Mr Joy’s submission were not put to the employee during cross-examination. There was no direct evidence upon which I could be satisfied that there was a standing instruction to employees to contact supervisors to ascertain whether work was available on days when wet weather occurred. No evidence in this regard was called from any supervisor or other employee. There was no evidence of any such direction in writing. Further, I am unable to be satisfied that the employee was ever advised not to report for work, on each of the days for which he is claiming payment. I can accept that employers in the civil construction industry may have limited resources or ability to find alternative useful work for employees, particularly when there are extended periods of wet weather. However, when an employee appeals against a stand-down, or a claim is otherwise made for payment of the period during which an employee was stood down, it will not be sufficient for the employer to justify the stand-down simply on the basis of wet weather. The employer must establish with respect to each individual employee who was stood down under s. 98 of the Act, that there was no useful work available. The occurrence of wet weather will not in itself, be sufficient to establish this. The employer will also be required to demonstrate that its operations were such that no useful work was available, and that reasonable steps were taken to investigate the possibility of useful alternative work, before the decision to stand the employee down was made. Where the employer contends that employees were contacted prior to commencing ordinary work and advised not to report for work, additional evidence will be required of the manner in which that advice was provided to employees, and the circumstances upon which the decision that useful work was not available, was made. Further, the fact that an employer has contacted the employee the day before a stand-down will mean that the evidentiary requirements about the reasons for the stand-down – such as the impact of wet weather – may be more onerous, as the severity of the weather would need to be such that the employer could demonstrate that a view that no useful work was available, formed well in advance of the time that the stand-down would take effect, was reasonable in the circumstances. I am also of the view that as s. 98 of the Act gives the employer the right to stand an employee down on any day or part of a day, that the question of whether useful work is available, must be determined on a daily basis. It is not open for an employer to decide at some point that work will not be available for a period in excess of a day and to advise employees of this at the beginning of that period. In my view, the employer should advise each employee of the need to effect a stand-down on the first day or part of a day, and then put in place a clearly understood and articulated process, to review the availability of useful work and the status of each employee in this regard, on each day that the employee is stood down, or at very least, for the following day. In this case, due to lack of evidence from the respondent, the evidence of the employee about reporting to work on each day for which payment is claimed is essentially uncontested. I accept that the evidence of the employee, including the time docket books, demonstrates that he was stood down without pay for 500.25 hours during the period subject of the claim. I am further of the view that on days when the time docket books indicate that some work was performed before the employee was stood down, the employee was entitled to payment for the entire day, by virtue of clause 3.5(3) of the Civil Construction Award, and I note that this point appears to have been conceded by the respondent. On days when the employee was stood down and performed no work, I am also reasonably satisfied that the stand-down was not permissible under s. 98(1) of the Act and that the employee is entitled to payment for such days. I am also of the view, that the question of whether or not the employee reported for work on days when no work was performed is not determinative of his entitlement to payment. What is determinative is whether the standing down of the employee on such days was effected in a manner which was permissible under s. 98 of the Act. For the reasons stated above, I am unable to be reasonably satisfied that it was. Accordingly for each of the 500.25 hours subject to the claim, I am satisfied that the employee was entitled to payment at ordinary rates. Payments for sick leave, annual leave, rostered days off and flexi-time made to the employee The respondent contends that for a significant number of days when the employee was stood down and for which he is claiming payment, the employee was accessing other paid leave entitlements such as sick leave, annual leave, rostered days off and flexi-time. The final issue for determination is whether such payments can be set off against the claim for underpayment of wages with respect to periods during which the employee was stood down. I reject the submissions of Mr Joy that the system of flexi-time operated by the respondent was allowable under clause 4.1(5)(a) of the Civil Construction Award which provides for the banking of up to five rostered days off. The Award does not provide for the banking of hours, but rather for the banking of rostered days off. Rostered days off accrue by virtue of hours in excess of 38 per week being banked to enable a rostered day off to be taken periodically. Quite simply, the respondent did not operate such a system. This was conceded by both witnesses for the respondent. I fail to see how an employee -- 7 of 9 -- QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 6 September, 2002 S:\QIRCDEV-BASE\QGIG\2002\VOL 171\NO.1 06.09.02.DOC 14 could be said to have agreed to bank rostered days off and take them at some future time to cover periods of wet weather, when the employee was not even aware that he had an entitlement to rostered days off in the first place, and the respondent did not operate a system of scheduled rostered days off in accordance with the Civil Construction Award. I do not accept Mr Joy’s argument that the terms of the Family Leave Award enabled the implementation of a system of flexi-time to provide payment for periods when work was unable to be performed due to wet weather. The time off in lieu of overtime provisions in the Family Leave Award clearly only apply where the employee elects with the consent of the employer, to take time off to discharge a responsibility to care for a member of the employee’s immediate family or household: refer clause 3.4 and clause 3.15. The employee was entitled to payment at ordinary time rates, for periods subject of this application, when he was stood down because of wet weather. The employee was also entitled to be paid overtime at overtime rates when overtime was worked. Overtime could not be banked and used to offset lack of payment for days when the employee was stood down due to wet weather. The result of the system of flexi-time introduced by the respondent, is that the employee has not been paid at ordinary rates, in circumstances where he was entitled to such payment. The employee has thus lost the benefit of overtime payments, and is entitled to be reimbursed at the ordinary time rate for the hours which he was paid under the flexi-time system. The FEDFA also claims that the employee is entitled to be reimbursed for 240.16 hours of annual leave and loading on that leave of 17.5%, on the basis of “improper use of annual leave”. The time docket books (Exhibit A2) and the time and wages slips (Exhibit R3) demonstrate that the employee was paid for 158.95 hours of annual leave during the period of his employment with the respondent. There is no evidence or any material to explain the discrepancy between the amount claimed and the amount paid during the period of employment. Accordingly, I intend to deal only with the 158.95 hours of annual leave in respect of which there is evidence before me. That evidence shows that the employee “cashed in” some part of his annual leave entitlement. The employee did this to make up a full week’s wage, during periods when he was stood down due to wet weather. Mr Vassallo giving evidence for the respondent, conceded that had the employee not used his annual leave entitlement to cover periods when he was stood down due to wet weather, he would not have been paid for those periods. There is also evidence that the employee actually took approximately ten days of annual leave during the period of his employment with the respondent. Clause 5.1(3) of the Civil Construction Award makes it unlawful for the employer to give or the employee to receive payment in lieu of annual holidays. The conduct of both the respondent and the employee is in breach of the Award. This can be contrasted with other findings I have made in this case to the effect that the respondent alone has breached the Award and the Act. On the one hand, to order payment of annual leave in these circumstances could be seen as allowing the employee to benefit from his own breach of the Civil Construction Award. On the other hand, I accept that the employee, had no other option but to cash in his annual leave, if he was to be paid for the periods during which he was stood down. Further, I have found that the standing down of the employee was not permissible under the Act. On balance, I have determined that the employee is entitled to recover the annual leave that he was paid for periods when he would otherwise have been stood down because of wet weather. The employee is not entitled to recover the payment for the period of annual leave which he concedes that he took as annual leave. Having reached this view, I have found support for it in a decision of a Full Bench of the Commission (Birch, Ashwood and McDonnell CC) in The Australian Workers’ Union of Employees, Queensland v Mount Isa Mines Limited (1987) 126 QGIG 462, which is exactly on point. In that case, the Full Bench was considering an appeal by The Australian Workers’ Union of Employees, Queensland (AWU) against a decision of an Industrial Magistrate, ordering payment to employees of Mount Isa Mines Limited, under the former section 21A(4)(b) of the Industrial Conciliation and Arbitration Act 1961-1987, for a period when they had been stood down without pay. The Magistrate had held inter alia that where employees subsequent to the stand-down, elected to take annual leave, they were not stood down, but were on annual leave. In upholding the appeal by AWU the Full Bench stated at 462: “We have reached the firm conclusion that where an employee is stood down and it is subsequently agreed between the employer and the employee that the whole or part of the period of the stand-down shall be taken as annual leave then that fact alone does not deprive the Industrial Magistrate of jurisdiction to make an order under Section 21A(4)(b). We find that in the circumstance the employee has lost remuneration because of his being stood down in that the period of his annual leave has been decreased by the period of the stand-down. We find that the Magistrate was wrong in law insofar as he ruled that employees who were stood down and subsequently by agreement with the employer availed themselves of annual leave can no longer be regarded as being stood down.”. In my view, there is nothing in the provisions of s. 98 of the Act or the facts of this case, which would enable me to distinguish the Full Bench Decision, and decline to follow it. Conclusions Mr Price conceded that the claim was not pressed with respect to days when the employee had been absent on sick leave, and reduced the amount of the claim from 507.85 hours to 500.25 hours to reflect sick leave which the employee had taken. After reviewing the documentary evidence including the time docket books and the pay slips, I am satisfied that the employee was paid sick leave for an additional three days. I also accept the evidence of the employee that he took approximately two weeks of annual leave during the course of his employment. The pay slips (Exhibit A3) and the time docket books (Exhibit A2) show that in the week of 20 December 2000, the employee was paid 68.40 hours of annual leave. It is more probable than not that this is the period when the employee actually took annual leave. Accordingly, 68.40 hours are to be set off against the claim of payment for 500.25. I am also satisfied on the basis of the time docket books and the payslips that the employee took a total of 4 days of sick leave amounting to 30.4 hours (7-9 February and 14 February 2001). The FEDFA conceded that only 7.6 hours of sick leave had been taken and adjusted the claim by that amount. Therefore, a further 22.8 hours is to be set off against the 500.25 hours claimed by the employee. There is to be no set off for annual leave loading paid by the respondent. The employee was paid annual leave loading at the time that he was paid for the annual leave. Consistent with the reasoning of the Full Bench in The Australian Workers’ Union of Employees, Queensland v Mount Isa Mines Limited (1987) 126 QGIG 462 the loss to the employee was the benefit of the annual leave, not the loading on that leave which was paid to him by the respondent. The Award rate increased with effect from 1 September 2000. The hours for which an off set has been allowed fell after that date, and accordingly are to be off set at the rate of $15.13 per hour. I have recalculated the claim on this basis. The employee is entitled to be paid the amounts of $705.00 for meal allowances and $7,425.34 for periods when the employee was stood down without pay. The respondent is entitled to set off that amount by the amount of $1,379.85 (22.8 hours of sick leave and 68.40 hours of annual leave calculated at the rate of $15.13 per hour). Accordingly, I order Vassallo Constructions Pty Ltd to pay to Allan Sommerfeld the amount of $6,750.49. After considering the submissions of Mr Joy in relation to capacity to pay, and the fact that no evidence was called for the respondent on this point, I have determined that the amount ordered, is to be -- 8 of 9 -- 6 September, 2002 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 15 paid in 4 equal instalments, with the first instalment being payable by 30 August 2002; the second instalment by 30 September 2002; the third instalment by 30 October 2002 and the fourth instalment by 30 November 2002. Any default on the part of the respondent in making payments of instalments in accordance with this order, will result in the balance of the total amount becoming immediately due and payable. I.C. ASBURY, Commissioner. Released: 23 August 2002 Appearances: Mr C. Price of the Federated Engine Drivers’ and Firemens’ Association of Australasia, Queensland Branch, Union of Employees. Mr C. Joy of the Queensland Chamber of Commerce and Industry Limited, Industrial Organisation of Employers for the respondent. -- 9 of 9 --