Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees v Chubb Protective Services (No 2) [2002] QIRC 195

258 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 28 March, 2002 ########################################################################################################################### QUEENSLAND INDUSTRIAL RELATIONS COMMISSION Industrial Relations Act 1999 – s. 276 – application to amend or void contract Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees AND Chubb Protective Services (No 2) (No. B1861 of 2001) COMMISSIONER BLADES 20 March 2002 Unfair contract – Section 276 Industrial Relations Act 1999 – Provision of security services on Nauru – Temporary employment on Nauru – Whether contracts harsh, unjust or unconscionable – Whether against public interest – Remuneration less than under industrial instrument – Avoidance of provisions of industrial instrument – Issues of fact – Contracts brought to an end, one by request, one by direction – Award or Certified Agreement had no application on Nauru – Inappropriate to compare rates of remuneration – Accommodation not as expected or promised – Failure to provide for notice of termination – Failure to pay departure tax as promised – Contracts found to be unfair and amended – Allowance to be made for hardship suffered by overcrowded accommodation – One week’s notice of termination or pay in lieu of notice inserted – Orders made for payment of monies. -- 1 of 6 -- 28 March, 2002 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 259 DECISION Mr Dennis Sullivan and Ms Maria Hiemstra, pursuant to an oral contract of employment with Chubb Protective Services (Chubb) undertook to perform security duties on Nauru when the Federal Government, after the interception of the “Tampa”, decided to process asylum seekers on that Island. It is common ground that the Chubb Protective Services Certified Agreement (Qld) 2000 (Certified Agreement) or the Security Industry (Contractors) Award – State (the Award) did not apply to that employment. An application (subsequently amended) has been brought by the Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees (the Union) on behalf of Mr Sullivan and Ms Hiemstra, alleging that the contracts provided for wages and conditions below those contained in the Certified Agreement, were harsh, unconscionable or unfair, were against the public interest and were designed to avoid the provisions of the Certified Agreement. The application seeks that the contracts be amended so as to treat the work done pursuant to the contract on Nauru as though it were subject to the application of that Certified Agreement. Orders for the payment of $5,327.70 on behalf of Mr Sullivan and $5,275.92 on behalf of Ms Hiemstra are sought although sums higher than that were suggested in the final submissions. The allegations are denied, as also is an allegation that there was an uneven bargaining power between the parties. The monetary amounts are claimed on the basis of the anticipated earnings for work on Nauru for a period of 28 consecutive days being the expected term of the contract. The sums were calculated on rates payable under the Certified Agreement. Ms Hiemstra performed no work at all and Mr Sullivan completed three shifts before they returned to Australia. Under s. 276(1) of the Industrial Relations Act 1999 (the Act), the Commission may amend or declare void a contract if it considers the contract is a contract of service that is not covered by an industrial instrument and the contract is an unfair contract. The only issue under this provision in this case, is whether the contract is an unfair contract. Under ss. (4), a contract may be considered unfair if the Commission considers the contract:– “(a) was an unfair contract when it was entered into; or (b) became an unfair contract after it was entered into because of the conduct of the parties, or a variation to the contract or for any other reason it considers sufficient.”. An unfair contract is defined in ss. (7) to mean a contract that:– “(a) is harsh, unconscionable or unfair; or (b) is against the public interest; or (c) provides, or has provided, a total remuneration less than that which a person performing the work as an employee would receive under an industrial instrument or this Act; or (d) is designed to, or does, avoid the provisions of an industrial instrument.”. Both Mr Sullivan and Ms Hiemstra left for Nauru on 4 October, 2001 with other employees of Chubb to join a contingent already there, arriving at 6.30 a.m. Both employees returned to Australia on Tuesday 9 October 2001. Mr Sullivan alleges that he was originally told by Mr Peter Harwood of Chubb on the weekend of 8 and 9 September that the contract would be for 12 hour shifts at 4 days on with 2 days off for one month to 6 weeks for $1,150 per week or $5,000 per month, including free board and food. He further alleges that on 3 October he was told by Mr Samios that the contract would be for 28 days straight for 12 hours each day with $40 per day for food and $5,000 per month. (The accommodation was also included). Mr Sullivan alleges he complained at the airport about the changed conditions, but nevertheless, went on the journey. Ms Hiemstra alleges that she was told by Mr Garry Hughes of Chubb, prior to her receiving her vaccination shots, that the contract was for one month of 12 hour shifts of 4 days on with 4 days off for $5,000 cash that was tax free. Accommodation and food were included in the package as was the travel. She alleges that it was not until two days after her return from Nauru that she was told by Mr Samios that the contract was for 28 days straight. Mr Samios, the Operations Manager of Chubb alleges that he addressed a group of prospective candidates at Chubb’s offices at Salisbury on 1 October. Ms Hiemstra was among the group. Mr Samios said that he told the group that the contract was for 28 days straight, 12 hour shifts, included accommodation and meals for an amount of $5,000. He alleges he then met each candidate individually and in Ms Hiemstra’s case, asked her whether she realised the work was 28 days straight with 12 hour shifts, together with accommodation and meals and payment of $5,000. He alleges that Ms Hiemstra agreed. Mr Samios said that he telephoned Mr Sullivan who was holidaying at Airlie Beach, but on stand-by, on 2 October wherein he queried Mr Sullivan whether he understood the conditions. He alleges that Mr Sullivan replied “Peter Harwood told me 4 on/4 off and $5,000”. Mr Samios said he told Mr Sullivan “No, its 28 days straight, 12 hour shifts for the $5,000”. Mr Samios alleged that Mr Sullivan told him that while that was a bit different to what he had been told, he said he was still interested and that he wanted to be in the front line with the troops. There was another telephone call on 3 October when Mr Samios added that on top of the information given the day before, there was to be $40 cash a day for meals. Mr Samios says he next saw Mr Sullivan at the airport when Mr Sullivan again told him “You know I was originally told by Peter Harwood 4 on/4 off” to which Mr Samios replied “Dennis, the conditions are what I told you yesterday – 28 days straight”. Mr Harwood’s allegations were that he spoke with Mr Sullivan in mid September in response to conversations initiated by Mr Sullivan who prompted him that the 12 hour shifts would be 4 on, 4 off. Mr Harwood said he was not sure because he had received no confirmation from Sydney. Mr Harwood also alleged that he told Mr Sullivan that Chubb Sydney had notified that flights, accommodation and meals would be provided and that the payment would be $5,000 per month gross, incurring the usual tax. Mr Garry Hughes of Chubb conceded that he understood that some people may have been told that the hours and days involved were 4 on and 4 off, 12 hours a day. However, he alleged that prior to their departure for Nauru on 4 October 2001, all guards, including Ms Hiemstra and Mr Sullivan were advised that working hours were 12 per day for 28 consecutive days. He alleges that at no stage was the $5,000 to be tax free. He confirmed that he was present at almost all of the one on one interviews on 1 October where employees were told that they would work 12 hours a day, 28 days straight. Mr Cameron Judson is the National Operations Manager of Chubb. He alleges that on 7 September 2001, he prepared an outline of the terms and conditions for the employees who would be working on Nauru. Those terms and conditions included $1,150 gross per week based on a roster cycle of 28 days x 12 hour shifts and the payment by Chubb of all travel costs to and from Nauru, including accommodation and meals. All persons selected for the work in Nauru were volunteers. -- 2 of 6 -- 260 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 28 March, 2002 There is considerable conflict in the evidence. The onus of proof is upon the applicant on the balance of probabilities. There is no doubt that there was confusion as to the terms and conditions of employment at about this time. Written examples were introduced into evidence. One contract dated 7 September 2001 provided for the payment of $1,150 gross per week for a minimum time of 4-6 weeks. Nothing was said about the shifts. At this time, there were no asylum seekers on the Island. A later contract dated 23 October 2001 provided for 28 days x 10 hour shifts, followed by a return to Australia for 8 days unpaid leave followed by another tour of duty to Nauru. Payment was at the rate of $182.14 per day. When Mr Sullivan and Ms Hiemstra went to Nauru, there were no written contracts as these had not arrived from Sydney and none were signed because of their early return. Other employees accompanying them to Nauru were eventually provided with written contracts, one of which has been exhibited, dated 11 October 2001. That document provides for the payment of $166.67 per day for 28 days x 12 hour shifts. Applicants’ evidence that they were initially told 12 hour shifts with 4 days on/2 days off (Ms Hiemstra’s evidence was 4 days on/4 days off) is partly corroborated by Mr Hughes and Mr Harwood and is accepted. I am also satisfied that the duties expected to be performed changed once the contingent reached Nauru. I am satisfied on the balance of probabilities on the whole of the evidence that when Mr Sullivan left for Nauru, he understood that the contract was for $5,000 per month with 12 hour shifts for 28 days straight, together with $40 per day for food, accommodation and air travel provided. I am further satisfied that he was told this by Mr Samios when he was on leave in the Whitsundays when Mr Samios telephoned him on 2 October 2001 and then on 3 October in another telephone call. Mr Sullivan conceded he was told that it was for 28 days straight with 12 hour shifts for $5,000. He’d had a conversation with the Union about the arrangement and while he voiced his concerns to Mr Samios that the deal had previously been mentioned to him at 4 days on/2 days off, he had plenty of time to change his mind and decline the offer. I am satisfied that when he travelled to Nauru he freely and voluntarily accepted, if not explicitly, then by implication, the deal as outlined by Mr Samios. Whether he expected to be able to negotiate some changes on behalf of his Union once he was there is beside the point. There was no representation made to that effect. Mr Sullivan conceded that neither Mr Samios nor Mr Hughes told him he could negotiate different conditions when he got to Nauru and I am satisfied that there was no indication given to him that he could do that. Had the terms and conditions of the contract only been made evident at the Airport shortly before leaving, considerations of voluntariness would have been relevant but that was not the case. Mr Sullivan had plenty of time to change his mind, he had work available with Chubb in Brisbane should he choose to stay and his free and voluntary acceptance of the terms and conditions outlined by Samios can only be inferred. Ms Hiemstra denied any knowledge of the requirement to work 28 days straight in 12 hour shifts. She denied she was told at any meeting at Chubb’s offices at Salisbury on 1 October, either by Mr Hughes or by Mr Samios or following that meeting by Mr Samios in a one on one interview. She says she understood that the tour of duty was for 28 days but there was no reference to 12 hour shifts each day. She thought it was 12 hours a day, 4 days on, 4 days off. The difficulty I have with her evidence arises when her written and oral evidence is compared. In her written statement, she said that she did not dare to question the rate of pay or the hours of work or anything else about the work in Nauru before she got there. She told the Commission under cross-examination that the statement was wrong and wished to change it. I do not accept that the statement was wrong. If her understanding was that it was 4 days on, 4 days off, there was no need for her to make that remark in the statement. If on the other hand she was aware that the arrangement was 28 days by 12 hour shifts, I can understand her making the statement because there was at least one person (Mr Sullivan) raising objections. It was also inconsistent (even taking into account the confusion that had existed) that while Mr Sullivan was being offered 28 days with 12 hour shifts on 2 October, she was being offered 4 days on and 4 days off on 1 October. I am satisfied on the probabilities that on 1 October, Ms Hiemstra was told of the conditions of 28 days with 12 hour shifts and that she freely and voluntarily accepted those conditions. Ms Hiemstra’s allegation that the payment was tax free is also not accepted. Her allegation was denied. Mr Hughes evidence was to the effect that no one knew what the tax situation was and I would have thought that there would be some difficulty in formulating a payment as a net amount as she alleged in oral evidence. However, there is also written evidence contained in the contract dated 7 September that earlier payments were of a gross amount and I find it unlikely that some other representation was made to Ms Hiemstra. There is also a dispute as to the circumstances under which both applicants returned to Australia. Chubb alleges in both cases they returned because it was their wish. Both applicants allege their contract was terminated by Chubb. Ms Hiemstra became ill almost as soon as she arrived. She suffered headaches, vomiting and diarrhoea after her first meal. She alleged that the food was disgusting, that she saw rats, cats and dogs in and near the dining room. She had expected single room accommodation but because of a shortage, was forced to share with two others. She could not sleep. She thought the operation was very disorganised. Before she left Brisbane, the duties were supposed to be perimeter security, changed to interaction with the refugees upon her arrival. The first night she was there, she alleges sexual harassment against a Supervisor about which a subsequent complaint was made. Under cross-examination, Ms Hiemstra said she did not want to come home after she became ill. She also said in her written statement that on that night she went looking for a manager to ask some questions. While she denied it had anything to do with her wanting to come home, the following passages appear in a statement she wrote about the sexual harassment complaint. She said:– “At about 22.30 on the Thursday night (being the night she arrived on 4 th October) I was in my room and went looking for Garry Hughes about getting of (sic) the Island. . . . I started explaining to him (Shaun Oliver) that I am not suitable for this place and I do not want to be here.”. She conceded in other evidence that she retrieved her own passport and arranged her flight home. She also said that she was abused at the airport for taking other persons’ seats. I am satisfied on the whole of the evidence that Ms Hiemstra voluntarily left Nauru because of her dissatisfaction with the environment and her conditions. Ms Hiemstra also alleges that on Friday 5 October, she was stood down because she made a sexual harassment complaint. Chubb denied the allegation and Mr Hughes said that if she was stood down, it was because of her illness. She was offered some work later on that Friday but declined and I would have thought that had she been stood down because of the complaint, no work at all would have been offered. She complained of being ill and her illness continued for some weeks after her return to Australia, backed up by a medical certificate. I accept the evidence that if she was “stood down”, it was because of her illness. It should be said that the Nauru Hotel had 353 rooms, 2 tennis courts, a swimming pool, licensed restaurant, bar, barbeque area, gaming room, convenience store and hotel security. The rooms were air conditioned with a balcony, refrigerator, television in every room, in-house videos, toilet, shower and the rooms were cleaned every morning. The Hotel was described in evidence as a 3 or 4 star Hotel. Photographs supported the description. I am satisfied that Ms Hiemstra’s evidence as to her conditions was exaggerated. After considering all of the evidence, I am satisfied that Mr Sullivan was removed because of his agitation and disruptive behaviour. He was a problem and it was easier to deal with it by way of his removal from the Island. When he spoke with Mr Samios on 2 October, while he was aware of the conditions, he told Samios that Mr Harwood had told him 4 days on, 2 days off. When they spoke on 3 October he again told Samios “You know I was originally told by Peter Harwood 4 on/2 off” – (there was an irrelevant conflict about whether it was 4 on/4 off). On Saturday 6 October, there was a poolside meeting where Mr Sullivan spoke in favour of employees joining the -- 3 of 6 -- 28 March, 2002 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 261 union – (he was the delegate). Mr Hughes gave evidence that Mr Sullivan did most of the objecting at that meeting. He was of the view that Mr Sullivan was a disruptive element and should have been helping get the “young blokes” through the early period instead of threatening him with the Unions. Mr Hughes’ problem with Mr Sullivan was not the grievances he was raising but the manner in which he was conducting himself. He made derogatory remarks about Chubb and Chubb’s Executives and it wasn’t so much his complaints but his total abuse to which Mr Hughes took umbrage. Mr Hughes eventually conceded that he would have passed on to Mr Oliver the Supervisor that Mr Sullivan was abusive, disruptive and argumentative. Mr Sullivan was very unhappy about his conditions and made it known. Soon after this conversation, Mr Hughes himself became ill and was not aware of the departure from the Island of Mr Sullivan and Ms Hiemstra. Other people instrumental in their removal, namely Mr Oliver and a shift boss named Denise were not called although there may have been some explanations for the failure to call Mr Oliver. It may have been possible for the applicant Union to have called Denise. Aside from what inferences (if any) can be drawn from the failure to call these witnesses, Mr Hughes, who alleged he asked the question “Who wants to go home” whereby Mr Sullivan replied “I want out” says he noted those comments into a notebook, yet left that notebook amongst his papers on Nauru. I thought that explanation was rather too convenient. On the whole of the evidence, I am satisfied that Mr Sullivan did not voluntarily return to Australia but was directed to return home. To summarise these findings, I am satisfied that both Mr Sullivan and Ms Hiemstra freely and voluntarily accepted terms and conditions of an oral contract which included 12 hour shifts for 28 days straight for $5,000 per month with accommodation and travel and $40 per day food allowance. I am satisfied that due to illness and dissatisfaction with the environment and the conditions, Ms Hiemstra voluntarily returned to Australia. I am satisfied that Mr Sullivan, due to his disruptive and abusive attitude and obvious dissatisfaction with his conditions was directed to return to Australia. Unfairness: Samuels JA in Antonovic v Volker (1986) 7 NSWLR 151 described “unjust” like “unfair” as “a slippery word of uncertain content”. Principles espoused by Sheldon J in Davies & Anor v General Transport Development Pty Ltd & Ors (1967) A.R. (N.S.W.) 371 as to the meaning of unfairness have been applied a number of times in decisions of this Commission. Sheldon J, speaking of a former provision (s. 88F of the N.S.W. Industrial Arbitration Act 1940-1966) said:– “To determine this (that it is unfair, or harsh or unconscionable), requires no more than the common sense approach characteristic of the ordinary juryman and this cannot be communicated – indeed it may be clouded – by an analysis of decided cases even where there is some analogy in the facts. It is a plain matter of morals not law.”. Under ss. (4) of the Act, the unfairness may arise after the contract was entered into because of the conduct of the parties, a variation to the contract or for any other reason the Commission considers sufficient. There are few restraints placed upon the exercise of the power and Sheldon J points out that the fact that the Commission has been given such massive power makes it imperative that it should be exercised with proper restraint. In A & M Thompson Pty Limited v Total Australia Limited (1980) 2 NSWLR 1, it was said that it should always be borne in mind the conduct of the parties, their capability to appreciate the bargain they had made and their comparative bargaining positions when entering into the contract. The Union submits that the proper starting point for a consideration of unfairness is the relevant Certified Agreement because Chubb, by entering into that Certified Agreement has acknowledged terms which are fair and reasonable for its employees in Queensland. It seems to me that submission ignores the fact that this employment was to be carried out in a foreign land for a short period of time in rather emergent circumstances. Accommodation in a 3 or 4 star resort Hotel was to be fully paid for together with food and travel. There is no evidence as to comparable income on the Island and as to the value of the Australian dollar and its buying power on that Island. The submission makes no allowance for the exploratory nature of the venture and the excitement and challenge which must have been present, some unfavourable climatic conditions notwithstanding. Living expenses in Australia for the period of the trip were affected. There were hidden advantages. Mr Sullivan was seen to pack a fishing line. It is not a valid comparison in my view to compare the Award or the Certified Agreement to the contracts in question, provided of course that the employees were not being exploited. These oral contracts provided for payment of $166.67 per day (being $5,000 for 28 days and two days travel) or $13.89 per hour. The Award rate for Security Officer Level 1 is $11.91 per hour. The remuneration paid to the employees, while in excess of the lowest Award classification, makes no allowance for overtime or penalties and annual leave or sick leave were not mentioned in the oral agreement. The subsequent written agreement (dated 11 October) provides that the daily remuneration is all inclusive. There is no evidence that these employees have been exploited. Granted the hours were long but the tour of duty was short and the decision to undertake the tour of duty was entirely optional. Ms Hiemstra performed no work on the Island yet was paid the same amount as Mr Sullivan who performed only three shifts. While the contract did not mention sick leave, it appears to have been paid. The Union has also submitted that there was no provision in the contracts for a reasonable period of notice. I consider that this is a valid argument. In BNY Australia Ltd v James (1992) 26 NSWLR 57, Hill J held that the contract was unfair in that it did not expressly provide for certain periods of notice and/or payment in lieu which would have been fair in the circumstances. While these contracts may have been for a fixed term of 28 days, in view of the hostile and unknown environment (the evidence indicated heat, humidity, mosquitos) into which the employees were placed, reasonable periods of notice should have been part of the contracts and the failure to do so renders the contracts unfair. I am also of the view that Mr Sullivan’s contract became unfair because of the conduct of the respondent in terminating it without giving any notice. It is noted that the subsequent written contracts illustrated by the letter dated 23 October provided for one weeks notice of termination or payment in lieu and it seems to me that that period of notice is a just measure of fairness. It is also submitted by the Union that the conditions on Nauru fell far short of what should be expected in a civilised workplace. The Union relied upon evidence which related to the accommodation, living conditions and oppressive shift rosters. I am satisfied on the evidence that the employees thought and expected single room accommodation at this Hotel. I have previously described the Hotel. However, the rooms did not have a separate bedroom, but contained a refrigerator, wardrobe and toilet all contained in the one room. To expect employees to share three to a room in my view rendered the contract unfair by the manner in which it operated. Mr Hughes was the Team Leader. He was not aware that three to a room were required until his arrival on the Island. While it was claimed that the employees were told the accommodation would be two to a room, Mr Hughes evidence suggests he was aware that it was to be single room accommodation. I prefer to accept the evidence that the employees expected single room accommodation. I accept that the overcrowded accommodation was one of the significant gripes of Mr Sullivan. This was the only suitable accommodation for numerous workers participating in this exercise and while there was no evidence as to the number of personnel attending to camp construction and other support, the population of the Island must have been swelled considerably. While it may have been somewhat difficult for Chubb to have been able to provide single room accommodation, the unfairness I think emerges in the absence of any additional payment for the hardship. Clearly a provision in a contract that accommodation in single room accommodation would be provided is not an unfair provision. However, it became unfair by reason of the manner in which it operated and, if it can -- 4 of 6 -- 262 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 28 March, 2002 be said that there was a variation which was accepted by conduct, by that variation. Although it may have been impossible for the employer to do otherwise, fairness required in the circumstances that some allowance be made for the hardship. There is no aspect of unfairness in a contract which provided that the employees would be paid all travel expenses. However, it was said by the Industrial Commission of NSW in Court Session in Reich v Client Server Professionals of Australia Pty Ltd (2000) 49 NSWLR 551, dealing with a provision similar to s. 276(4) of the Act, that a contract may be found to be unfair because of any conduct of the parties. The Commission said that conduct by an employer which is unfair and which breaches the employment contract, even though not permitted by the terms of that contract would nevertheless render such contract unfair and amenable to relief. That Mr Sullivan and Ms Hiemstra were required to pay their own departure tax when they left the Island in breach of the condition that all travel expenses would be paid renders the contract unfair because of the conduct of the employer. The public interest: The cases indicate a reluctance to define the concept and “public interest” is not defined in the Act. Because only the interests of an individual are affected does not mean that something is not against the public interest (Sinclair v Maryborough Mining Warden (1975) 132 CLR 473) and the concept of the “public interest” is of the widest import (Doyles Construction Lawyers v Serratore (2002) 169 QGIG 196. Dey J in Federated Miscellaneous Workers’ Union re Wilson Parking (N.S.W.) Pty Ltd and C. Whalan & Anor 1980 AILR 280 considered matters relevant to a public interest test in the unfair contracts jurisdiction of the N.S.W. Industrial Commission. In the judgment, Dey J mentioned the following in a consideration of the public interest:– • the protection of the rights of Union members from an erosion of their employment prospects by the employment of persons at less than award rates; • the defeat of the industrial objectives of the legislation; • protection against those who seek to avoid the regulation of wages and conditions of employment by award, by getting their work done for them in a way which gives them a “business advantage over competitors so bound”; • minimum rates of pay also protects fair employers from inequitable competition from employers who pay less than just wages; • the circumvention of obligations which would otherwise arise under the award. Sheldon J in Davies thought that the most relevant “public interest” were transactions which threaten general industrial standards. It is also a matter of public interest that parties should generally be kept to agreements entered between them – Baltic Shipping Company v Dillon (Mikhail Lermontov) (1991) 22 NSWLR 1 at 9 and 20. It could probably be said that agreements which were unfair would also be against the public interest. In this respect, it is my view that the unfairness reflected in previous paragraphs of this decision offend against the public interest test but only to the extent already identified. There is no evidence that this employer sought to gain an economic advantage over a competitor through these agreements and I do not consider that there was an exploitation of these employees. Neither the Award nor the Certified Agreement had any application on Nauru and the Industrial Relations Act 1999 has no general extra-territorial application to the services rendered on Nauru (not to be confused with the contract itself) – see Mynott v Barnard (1939) 62 C.L.R. 68 and other cases cited in ALHMWU v Chubb Protective Services (2002) 169 QGIG 103-5. Remuneration less than industrial instrument or avoidance of the provisions of an industrial instrument: Neither the Award nor the Certified Agreement apply to employment on Nauru. At the time that either was made, there was no contemplation that the respondent would engage employees to perform work on Nauru. In those circumstances, the contracts were not designed to nor did they avoid the provisions of an industrial instrument. While the contracts may have provided for a remuneration which was less than that which a person performing work as an employee would receive under an industrial instrument in Australia, this performance was not in Australia but in a foreign environment where accommodation and living expenses were met by the employer. In this regard, I am unable to conclude that unfairness resulted because of the rate of remuneration as compared to the Award or the Certified Agreement. I consider it inappropriate in these circumstances to draw negative conclusions from those comparisons. Conclusion: The end result is that I am satisfied that the contracts became unfair because of the conduct of the respondent and the manner in which they eventually operated. Should the contracts be amended: Section 276(2) provides for certain considerations for the Commission when deciding whether to amend or declare void a contract or part of a contract. In an application under s. 276 there are three separate and distinct issues. Once a contract is found to be unfair, it does not automatically follow that an amendment or avoidance will be ordered. That is entirely an exercise of judicial discretion unfettered even by the terms of ss. (2). If a contract is amended or avoided, the third discretion then arises as to whether orders should be made under ss. (5) – Autobake Pty Ltd v Budd & Anor (1986) 19 IR 18. Mr Sullivan had recourse to the Union after he was advised of the 28 days by 12 hour shift requirement and Ms Hiemstra was present with fifteen or so other employees when told of the package. She went along with them. While it was alleged that there was an uneven bargaining power, an allegation which was not developed further, Dowsett J in Buchmueller v Allied Express Transport (1999) 88 IR 465 doubted that the provisions of the Act were intended to mean that the relationship of employer on the one hand as compared to a potential employee on the other gave rise to inferences of weakness in the bargaining process or the exercise of undue influence or pressure. In my view there was no disparity in the relative bargaining power or any undue influence or pressure or unfair tactics used against the employees. There was no evidence that either employee lacked the moral strength of an ordinary person. Subsection (2) is entirely open ended as to the considerations applicable in deciding whether to amend or declare void a contract. While the evidence is not clear when Chubb became aware of or should have become aware of the accommodation problems on Nauru, no effort was made to placate those employees suddenly affected by the crowded conditions. Those employees expected something different and, it seems, so too did Chubb. The employees were misled although it would seem, unintentionally. The contract lacked a reference to any period of notice of termination in circumstances of a hostile foreign environment where the unexpected might well arise. This is a situation which clearly needs rectification. In my view, the unusual circumstances which came about require that the contracts be amended. I am of the view that the contract should be amended in Mr Sullivan’s case, to provide for the giving of one weeks notice of termination and in both cases, to provide for a recompense or recognition of the hardship suffered by the overcrowded accommodation. The failure to pay the departure tax -- 5 of 6 -- 28 March, 2002 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 263 should also be addressed, perhaps by an amendment for an appropriate provision providing for payment in the event of a breach occurring – Reich at p. 567. Orders: This is the third step of the process referred to. Section 276(5) of the Act allows the Commission to make any order it considers appropriate about payment of an amount for a contract amended or declared void. As Ms Hiemstra’s return to Australia was at her request, I do not consider she is entitled to any recompense in respect of a lack of notice. However, Mr Sullivan should be provided with compensation in lieu of that one weeks notice. The hardship associated with the overcrowded accommodation is difficult to evaluate in monetary terms. Chubb experienced some difficulty in finding employees willing to return to Nauru after their initial 28 day stint. The 23 October contract provided for 10 hour shifts and $182.14 per day. The employees were 2 hours a day and $14.47 a day better off. Under this new arrangement, the hourly value was $18.21 or $51.85 per day extra. It can be inferred I think that some of the difficulty in having employees return to Nauru was the overcrowded accommodation and the additional payment recognised that fact. It seems to me to be appropriate for an order for the payment of an additional $52.00 per day in respect of both employees required to sleep three to a room. Mr Sullivan should be paid an additional amount of $1,150 in lieu of one weeks notice of termination of his contract. Both Mr Sullivan and Ms Hiemstra were paid an amount of $1,478.58 gross for the time spent on Nauru. There is no evidence as to how this sum was calculated but appears to cover more than the work that could have been required. They were only there for 6 days and as indicated before, Mr Sullivan completed three shifts and Ms Hiemstra none. There may have been an amount included for meals and expenses but there is no evidence as to what was included in the payment. Each employee spent five nights on the Island. I assess the following sums to be payable:– Ms Hiemstra – 5 nights at $52 per night, plus departure tax $25 = $285.00 Mr Sullivan – 5 nights at $52 per night, plus one week at $1,150, plus departure tax of $25 = $1,435.00 Those amounts should be paid within 14 days. I order accordingly. B.J. BLADES, Commissioner. Released: 20 March 2002 Appearances:– Mr J. Nolan, Counsel, with him Mr K. Crank for the Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees. Mr N. Chadwick, instructed by Fisher Cartwright Berriman, for Chubb Protective Services. -- 6 of 6 --