Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees v Wilsons Parking Australia 1992 Pty Ltd [2002] ICQ 49 (2002) 171 QGIG 323

323 Vol. 171 FRIDAY, 8 NOVEMBER, 2002 No. 10 ########################################################################################################################## # INDUSTRIAL COURT OF QUEENSLAND Industrial Relations Act – s. 341(1) – appeal against decision of industrial commission Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees AND Wilsons Parking Australia 1992 Pty Ltd (No. C78 of 2002) PRESIDENT HALL 24 October 2002 DECISION This is an appeal against a decision of the Queensland Industrial Relations Commission delivered 13 August 2002 and now reported at 170 QGIG 465. It sufficiently exposes the difficulty to recite the preamble to the Commission’s decision. (The assertions and conclusions of fact are not challenged in the appeal). “The Australian, Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees (ALHMWU) has filed an application seeking an order that Wilson Parking Australia 1992 Pty Ltd (Wilson Parking) pay to Eamonn Burke the sum of $4,518.80, such sum being payment of unpaid long service. The matter is not straight forward. Mr Burke was employed as a Car Park Attendant in the same multistorey car park at 118 Charlotte Street, Brisbane for almost twelve years. That car park, and indeed most other multistorey car parks, operates in a similar way. The owner of the building in which the car park is situated, in this case National Mutual which became AXA, leases the car park to a car park operator. It is usual practice for the building owner to call for tenders to be submitted for the operation of the car park. The successful tenderer then enters into a lease for the operation of the car park facilities for a number of years. Towards the expiration of the lease, the building owner repeats the process. The effect is that the car park operator in one building may change with each new tender. -- 1 of 5 -- QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 8 November, 2002 324 Set out below are the various operators of the car park in which Mr Burke worked and his periods of employment with each of those operators: Kings Parking Company Queensland Pty Ltd – 9 June 1989 to 10 September 1992; Wilson Parking Australia 1992 Pty Ltd – 11 September 1992 to 31 March 1993; KC Melbourne Pty Ltd trading as KC Parksafe – 1 April 1993 to 6 November 1998; Australian Car Parking Pty Ltd t/a Care Parking and then Care Park – 7 November 1998 to 30 June 1999; and Wilson Parking Australia 1992 Pty Ltd – 1 July 1999 to 1 June 2001. Evidence was given by Mr Burke and Barton Staines the State Manager of Wilson Parking. Reference will be made to their evidence throughout this decision. The matter for determination is whether Mr Burke is a transferred employee within the meaning of s. 69 of the Industrial Relations Act 1999 so as to establish continuity of service and hence an entitlement to long service leave.”. It seems to me to be tolerably clear that if the claim had been made under the Industrial Conciliation and Arbitration Act 1961, the claim would have failed. Section 17(16) of that Act provided: “(16) Qd. s. 10B (13). For the purposes of this section – (a) where the calling carried on by a person who is an employer shall have been before, or shall be on or after, the said date transmitted to another person by operation of law or by agreement between them, that transmission shall be deemed not to have broken or otherwise affected, or to break or otherwise affect, the continuity of the service of any employee whose service shall have been or shall be, upon the transmission aforesaid, transmitted from the one to the other person aforesaid; and (b) the respective periods of the service of that employee with each of the aforesaid persons shall be taken into account in calculating the length of the continuous service had by him with the person to whom his service shall have been or shall be transmitted as aforesaid. In this subsection the term ‘transmission’ includes but without limit to the generality of the meaning thereof, transfer, assurance, conveyance, assignment or succession, and derivatives of that term shall have a corresponding meaning. In all proceedings brought in respect of rights conferred by this section on an employee the averment that a calling was at or about a specified time transmitted from one person to another person by operation of law or by agreement between them shall be sufficient evidence of the fact until the contrary is proved.”. (emphasis added) It was held in Tinniswood v. Martin (1958) 43 QGIG 1019 that notwithstanding the definition of “transmission”, the subsection had application only where a calling passed from employer A to employer B by operation of law or by agreement between A and B. Since there was no agreement between e.g. Australian Car Parking Pty Ltd and Wilson Parking Australia 1992 Pty Ltd, it is said that the present claim would have failed. Section 17(16) of the Industrial Conciliation and Arbitration Act 1961, which without the provision about averment had been s. 10B(13) of the Industrial Conciliation and Arbitration Act 1932, was subsequently incorporated in s. 241(1)(c) and (d) of the Industrial Relations Act 1990. The current statutory regime is quite different. The appellant helpfully summarises the current scheme as follows: “The Entitlement 5. The basic entitlement to long service leave is set out in s. 43 of the Act and depends upon the relevant employee having a minimum prescribed period of ‘continuous service’. 6. ‘Continuous service’ is defined in s. 42 of the Act to mean, relevantly, ‘the employee’s continuous service with the same employer’. 7. By virtue of s. 68 of the Act, s. 69 of the Act preserves an employee’s continuity of service with successive employers if the employee is a ‘transferred employee’, namely ‘a person who becomes an employee of an employer (the “new employer”) because of the transfer of a calling to the new employer from another employer (the “former employer”)’. 8. In schedule 5 to the Act, ‘transfer’ of a calling includes the transmission, assurance, conveyance, assignment or succession of the calling: (a) either by:- i) operation of law; or ii) agreement, including an agreement effected by a third person; and iii) either before or after the commencement of this Act.’ 9. ‘Calling’ is defined in schedule 5 to mean:- ‘(a) A craft, manufacture, occupation, trade, undertaking or vocation; or (b) A section of something mentioned in paragraph (a)’.”. [For fullness one should interpolate that the change in language was an innovation of the Workplace Relations Act 1997, see s. 197(1)(c) and (d), save that (importantly) the current extension of the definition of “transfer” to include “an agreement effected by a third person” was not made under the Workplace Relations Act 1997]. Counsel have searched the extrinsic materials to which regard may be had pursuant to s. 14B of the Acts Interpretation Act 1954 in interpreting the Industrial Relations Act 1999. The attempt to identify the purpose of the new definition of “transfer” was of no avail. The materials are silent. The Commission went further and (properly in my view) had regard to the Report of the Industrial Relations Taskforce of December 1998. Again, the document is unhelpful. Only recommendation 32 was relevant. Recommendation 32 was: “That there be further legal investigation of the implications of widening the definition of transfer of business to deal with contrived circumstances where employee entitlements are lost.”. -- 2 of 5 -- 8 November, 2002 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 325 That recommendation is inherently uninformative. Understandably counsel sought enlightenment in developments in other jurisdictions. In recent times the High Court and the Federal Court of Australia have been called upon to examine the operation of ss. 149 and 170 MB of the Workplace Relations Act 1996 (C‘wth) in a variety of circumstances to determine whether a particular employer is bound by an award or certified agreement as a “successor, assignee or transmittee . . . to or of the business or part of the business” of an earlier employer. A useful starting point is the decision of the High Court in PP Consultants Pty Ltd v. Finance Sector Union of Australia (2000) 201 CLR 648. The reporter summarised the facts of that case as follows: “PP Consultants Pty Ltd conducted a pharmacy business at Shop 5 in the Byron Bay Shopping Plaza. On 12 September 1997, St George Bank Ltd (the Bank) closed its branch agency, which it had conducted from Shop 4B in the Plaza. PP Consultants took an assignment of the Bank’s lease of Shop 4B and commenced building work to combine Shop 4B and Shop 5 into a single shop. From Monday 15 September 1997 PP Consultants conducted the branch agency for the Bank in conjunction with its pharmacy from the combined premises pursuant to an agreement with the Bank. By that agreement PP Consultants was required to collect deposits, transact withdrawals and to open deposit accounts for customers. PP Consultants offered employment to two former employees of the Bank at the same rates of pay as they had had from the Bank, and they performed substantially the same work. On 23 September 1998 the Finance Sector Union of Australia commenced proceedings against PP Consultants in the Federal Court of Australia for declarations, including a declaration that PP Consultants was a successor, assignee or transmittee of the business or part of the business of the Bank within the meaning of s. 149(1)(d) of the Workplace Relations Act 1996 (Cth). Mathews J held that PP Consultants had not succeeded to the Bank’s business within the meaning of the Act and dismissed the application with costs. The Union appealed to a Full Court of the Federal Court (Wilcox, Ryan and Madgwick JJ) which on 10 September 1999 allowed the appeal. PP Consultants then appealed to the High Court from the judgment and orders of the Full Court, by special leave granted by Gleeson CJ and Callinan J.”. The High Court unanimously allowed the appeal. Gleeson CJ, Gaudron, McHugh and Gummow JJ published a joint judgment in the course of which the following passage occurs (at 654 to 655): “12 As was pointed out in Australia Transport Officers Federation (28), ‘the word “business” is notorious for taking its colour and its content from its surroundings’. Thus, for example, the expression ‘the business of government’ signifies something quite different from the expression ‘the business of grazing’ which was considered in Hope v Bathurst City Council (29). In the latter case, it was held that the expression ‘carrying on the business of grazing’ meant ‘grazing activities undertaken as a commercial enterprise in the nature of a going concern, that is, activities engaged in for the purpose of profit on a continuous and repetitive basis’ (30). 13 Whilst the notions of ‘profit’ and ‘commercial enterprise’ will ordinarily be significant in determining whether the activities of a private individual or corporation constitute a business (31), they play little, if any, role in identifying whether one government agency is engaged in the business of government previously undertaken by another government agency. In that situation, it is sufficient to ascertain whether or not the activities of the former are substantially identical to the activities or some part of the activities previously undertaken by the latter. That is because the word ‘business’ takes on a special or particular meaning in the expression ‘the business of government’. It is not because, as a matter of ordinary language, ‘business’ means or includes activities undertaken in the course of business. 14 The question whether one person has taken over or succeeded to the business or part of the business of another is a mixed question of fact and law. For this reason and, also, because ‘business’ is a chameleon-like word, it is not possible to formulate any general test to ascertain whether, for the purposes of s. 149(1)(d) of the Act, one employer has succeeded to the business or part of the business of another. Even so it is possible to indicate the manner in which that question should generally be approached, at least when a non-government employer succeeds to the commercial activities of another non-government employer. As already indicated, special considerations apply when one government agency succeeds to the activities of another. And there may well be other considerations where a government contracts with a non-government body for the performance of functions previously carried out by a government authority. 15 As a general rule, the question whether a non-government employer who has taken over the commercial activities of another non-government employer has succeeded to the business or part of the business of that other employer will require the identification or characterisation of the business or the relevant part of the business of the first employer, as a first step. The second step is the identification of the character of the transferred business activities in the hands of the new employer. The final step is to compare the two. If, in substance, they bear the same character, then it will usually be the case that the new employer has succeeded to the business or part of the business of the previous employer.”. (emphasis added) If that test was applied here one would be forced to the conclusion that Wilson Parking Australia 1992 Pty Ltd had succeeded to the business of Australian Car Parking Pty Ltd. The same activity was being carried out, on the same site, with the same equipment and without break in time. Many of the Federal Court authorities deal with the privatisation of public services. Such cases are not directly on point. However, the analysis of the passage drawn from PP Consultants Pty Ltd v. Finance Sector Union of Australia (2000) 201 CLR 648 undertaken by the Federal Court is both helpful and persuasive. In Australian Rail, Tram and Bus Industry Union v. Torrens Transit Services Pty Ltd (2000) 105 FCR 88 at [54] to [55] and at [62] Mansfield J found nothing in the High Court passage to disturb the proposition in North Western Health Care Network v. Health Services Union of Australia (1999) 164 ALR 147 that the expression “successor, transmittee or assignee … of the business” is to be interpreted in a broad and practical way rather than in a technical way. Similarly, in Minister of State for Employment, Workplace Relations and Small Business v. Community and Public Sector Union (2001) 109 FCR 303 at [169] Ryan and Madgwick JJ said: “The issue of succession, transmission or assignment, as distinct from the issue concerning ‘part of a business’ received little express attention in PP Consultants. However, it is apparent from the primacy accorded (at para 5); to the ‘before and after’ comparison and from the use of the lay terms ‘taken over’ (at para 14) and ‘disposed of’ (at para 19) in considering whether anything had passed from the first employer, that the joint judgment implies an aversion from any narrow or technical reading of the phrase ‘successor, assignee or transmittee’. Neither did Callinan J appear attracted to a technical approach: see para 29, para 39-para 43.”. Like Mansfield J op. cit. at [54], their Honours were content to put aside Bransgrove v. Ward and Syred [1931] AR (NSW) 272 where the New South Wales Industrial Commission (in dealing with a precursor to s. 149 of the Workplace Relations Act 1996 (C’wth) had held: “To constitute successorship there must be some definite legal nexus or privity between a respondent to the Federal award who is the predecessor, and a successor who then, by virtue of the Commonwealth statute, becomes bound by the award. The existence of that nexus or privity must be evidenced either by direct proof of a transaction or by facts from which the conclusion may be drawn of some transference of right to the business from the predecessor to the successor.”. That language and that reasoning is, of course, reminiscent of Tinniswood v. Martin (1958) 43 QGIG 1019. -- 3 of 5 -- QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 8 November, 2002 326 In Health Services Union of Australia v. Gribbles Radiology [2002] FCA 856, Gray J applied the observations in the privitisation cases to a private sector transaction observing at [52]: “[52] If the Court were to take a technical approach, and to hold that some direct transaction between the two employers were necessary to satisfy s. 149(1)(d), the object of the provision would be evaded easily. For instance, it would be a simple matter for the first employer to transfer the right to conduct the business to a third party, not an employer, who could then transfer it to the new employer. There would be no direct transaction between the two employers, but the result would be precisely the same as if there had been. The presence of a third party cannot of itself exclude a factual situation from amounting to a succession, assignment or transmission. The use of the word ‘successor’ in s. 149(1)(d) suggests that there is not a need for a direct transaction. It is possible, even in the technical sense of the word, for one person to be the ‘successor’ of another without any direct transaction between them.”. (Health Services Union of Australia v. Gribbles Radiology Pty Ltd, ibid, is subject to appeal). Counsel for the respondent rightly drew the Court’s attention to the circumstance that in Australian Rail, Tram and Bus Industry Union v. Torrens Transit Services Pty Ltd (2000) 105 FCR 88 at [54] Mansfield J said, “[T]he ‘substantial identity of activities’ test is not of itself a sufficient test to determine if there has been a succession transmission or assignment of a business. I think that is plain enough in any event. For example, if the business of a local hardware store were simply to come to an end, and the premises were then some months later purchased and then operated by an entirely new and independent operator as a local hardware store in much the same way, with some one or more of the same employees, I do not think s. 149(1)(d) would then have been intended to apply to the new operator of the hardware business simply because there was a substantial identity of activities being performed in the two business.”, and that in Health Services Union of Australia v. Gribbles Radiology Pty Ltd [2002] FCA 856 at [513] Gray J observed, “Mansfield J’s example in Torrens Transit Services, clearly obiter, may well be right.”. But with respect to counsel, the passage assists the respondent not at all. Here, so soon as the lease of Australian Car Parking Pty Ltd came to an end, Wilson Parking Australia 1992 Pty Ltd took possession of the site in Charlotte Street and, pursuant to a lease requiring the company to do so, began to conduct the very business previously conducted by Australian Car Parking Pty Ltd. There was no gap in time. The site, the equipment and the lessor were the same. Further, whilst the lessor gave no guarantee of earnings and, indeed, no representations about future income, the lessor did enable Wilson Parking Australia 1992 Pty Ltd to induce itself to contract by including in the invitation to treat a breakdown of the monthly transactions of the business operated by Australian Car Parking Pty Ltd. I am satisfied that if the “tests” in the federal authorities be applied Wilson Parking Australia 1992 Pty Ltd is the “successor” to Australian Car Parking Pty Ltd. Counsel for the respondent rightly stresses that s. 69 of the Industrial Relations Act 1999 and the definition of “transfer” were not the subject of consideration in any of the federal cases and that the language of s. 69 and the language of the definition is not the language of the Workplace Relations Act 1996 (C’wth). However, because “transfer” is defined inclusively there is no apparent reason for denying the application of the authorities referred to. Indeed, because the concept of “calling” of an employer is also sometimes utilised in determining entitlement to union membership and scope of award, there is room for argument that the suggestion of the Full Court of the Federal Court in Finance Sector Union v. PP Consultants Pty Ltd (1999) 91 FCR 337 is to be applied. Federally, in Stellar Call Centres Pty Ltd v. Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union (2001) 106 FCR 302 at [30] the Full Court of the Federal Court has now, of course, rejected that approach, observing: “The High Court must be taken impliedly to have rejected the suggestion of the Full Court in Finance Sector Union v. PP Consultants at 352 [33] that ‘it is logical to focus on the nature of the activities undertaken by the two employers and the question whether there is any material change in the nature of the employees’ duties or working conditions’. As we understand it, even if there be complete identity between the duties and working conditions of the relevant employees of both employers, that will not attract the application of s. 149(1) unless the business in which those duties are performed for the new employer is in substance identical in character with the business, or a distinct part of the business, of the presumptive transmittor.”. However, in the absence of full argument and because it is unnecessary to do so in order to deal with this appeal, I do not go so far. It is useful to be repetitious and reproduce s. 69(1) of the Act and the definition of “transfer”: “69 Continuity of service – transfer of calling (1) A “transferred employee” is a person who becomes an employee of an employer (the ‘new employer’) because of the transfer of a calling to the new employer from another employer (the ‘former employer’). ‘transfer’ of a calling includes the transmission, assurance, conveyance, assignment or succession of the calling – (a) either by – (i) operation of law; or (ii) agreement, including an agreement effected by a third person; and (b) either before or after the commencement of this Act.”. (emphasis added) The reference to “an agreement effected by a third person” cannot be a reference to an agreement between the first employer and the second employer brokered or otherwise introduced by a third party. Such an agreement would simply be “an agreement” pursuant to which the second employer succeeds to the calling of the first employer. The reference has to include the case in which the succession of the second employer to the previous calling of the first employer is effected by an agreement entered into by a third party with the second employer. That is what occurred here. It was the lease entered into between AXA and Wilson Parking Australia 1992 Pty Ltd which put Wilson Parking 1992 Pty Ltd into possession of the multistorey car park at 118 Charlotte Street, and into possession of the equipment previously used by Australian Car Parking Pty Ltd to operate a car park. It was that lease which subjected Wilson Car Parking 1992 Pty Ltd to an obligation to conduct the business of a car park at 118 Charlotte Street. It was that combination of circumstances which, without gap in time, led to Wilson Parking 1992 Pty Ltd conducting the “undertaking” (or “calling”) previously conducted by Australian Car Parking Australia Pty Ltd. -- 4 of 5 -- 8 November, 2002 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 327 Tinniswood v. Martin (1958) 43 QGIG 1019 is not a venerable decision. It was decided under the Industrial Conciliation and Arbitration Act 1932. It was actually a case about reconstitution of a partnership. If it had arisen under the Industrial Conciliation and Arbitration Act 1961 or any of the subsequent Acts it would almost certainly have been dealt with (quite differently) under provisions preserving continuity of employment where a partnership is reconstituted. Further, a case determined under the Industrial Conciliation and Arbitration Act 1932 shortly after the addition of the long service leave provisions in 1952 had determined that it was not essential to a finding that a calling had been transmitted from a first to a second employer, that the agreement between the first and the second employer describe the transaction as the sale of a business, contain a restraint of trade clause binding on the vendor or deal with the matter of goodwill: see Re Mechanical Engineering Award – State (1954) 39 QGIG 933 and G M Ashwood v. The Oban Pastoral Company Pty Ltd (1958) 43 QGIG 1173. Henceforth, as federally, the question whether there was a transmission was treated as a question of mixed law and fact: provided that there was an agreement between the first employer and the second employer. Once that rule was established, the purpose to be achieved by restricting the protection of continuity to cases where a calling was transferred from a first to a second employer by agreement between them became a little elusive. If the purpose was to give the second employer the chance to confront the problem of potential liability for long service leave, that opportunity continues to be observed by the extension of the scheme about “transmission” to the case where an agreement between the second employer and a third party brings about succession of the second employer to the previous calling of the first employer. In my view within the meaning of s. 69(1) the calling of Australian Car Parking Pty Ltd was transferred to Wilson Parking Australia Pty Ltd on or about 30 June 1999/1 July 1999. There is a paucity of detail about the earlier “transfers”. However, the case has been conducted throughout on the basis that the transaction between Australian Car Parking Pty Ltd and Wilson Parking 1992 Pty Ltd is representative. Given the small amount of money involved and the cost of litigation, I can understand why that step was taken. It seems to me that the parties are bound by the way in which they have chosen to conduct their case. The final element is that for the scheme at Part 6 of the Industrial Relations Act 1999 to attach Mr Burke must have been employed by Wilson Parking 1992 Pty Ltd because of the transfer of the calling to it from Australian Car Parking Pty Ltd. On the facts, it is plain that the only reason that Mr Burke became an employee of Wilson Parking 1992 Pty Ltd was because on or about 30 June 1999/1 July 1999 Wilson Parking 1992 Pty Ltd succeeded to the car parking business of Australian Car Parking Pty Ltd at 118 Charlotte Street, Brisbane. I allow the appeal. I set aside the decision of the Queensland Industrial Relations Commission. In lieu thereof I order that Wilson Parking 1992 Pty Ltd pay to Eamonn Burke the sum of $4,518.80 by way of payment in lieu of long service leave. Dated 24 October 2002. D.R. HALL, President. Released: 24 October 2002 Appearances: Mr R. E. Reed, instructed by Hall Payne Solicitors, for the appellant. Mr M. Brady, instructed by Deacons Solicitors, for the respondent. -- 5 of 5 --