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Qualifications a floor, but not a ceiling, for award coverage: FCAFC
In a decision that has affirmed what those working in the industrial relations space already knew – that fitting an employee’s role into an award classification is hard – a full court of the Federal Court in King v Melbourne Vicentre Swimming Club Inc [2021] FCAFC 123 has overturned a decision of Justice Wheelahan that found a swimming coach was not covered by the Fitness Industry Award 2010 (the Award).
Background
The applicant had made an underpayment claim based on penalty rates and allowances he alleged were owed to him under the Award.
The relevant classification (Level 4) sets out general requirements in relation to supervision and judgment, which were not contested. It goes on to say that to fit within the Level 4 classification an employee (as relevant to the applicant) “may also be” a coach of beginner swimmers holding a current recognised ‘Bronze Licence for Coaching’ qualification who has delivered the number of coaching hours specified.
The applicant, who has a Silver Licence qualification and coached middle level squads of swimmers, had argued that the words “may also be” meant someone did not have to possess the exact experience and qualifications listed in the classification descriptors and that, although they imposed a “floor” that must be met to fall within the classification, the classification descriptors did not impose a “ceiling”. That meant, according to the applicant, a swimming coach with qualifications and experience in excess of the classification descriptors was not outside of its coverage.
Wheelahan J disagreed with the applicant’s interpretation.
In reaching his decision his Honour considered the history of the Award to provide the industrial context to the classification structures, as well as the text of the Award itself (to give it meaning consistent with that history). However his Honour also acknowledged that modern awards, like any industrial instrument, need to be understood separate from their history so that they may be used and interpreted by participants in particular industries; particularly when, as was the case here, there is the threat of pecuniary penalties for non-compliance with an award provision.
In light of the above, and when considering the Award as a whole, his Honour construed the words “may also be” as a requirement to have the qualifications and experience set out in the Level 4 classification. That was based predominately on the fact the Award prescribes mandatory qualifications and experience for swimming teachers and coaches for accreditation purposes, and because the Level 4 classification provisions are so specific. Accordingly, the applicant’s qualifications and experience was held to be outside the scope of the Award.
Appeal
The Full Court agreed with the analysis of his Honour at first instance that although industrial history and practices may provide context, and are important in the event of ambiguity in the interpretation of an award provision, interpreting an award should begin with an analysis of the ordinary meaning of the words used (citing City of Wanneroo v Holmes [1989] FCA 369).
Having regard to “the architecture of the classification structure” of the Award, the Full Court agreed with Wheelahan J that in order to fall within the Level 4 classification an employee must meet all of the requirements for the classification Level, and that the words “may also be” should be interpreted to mean the specific requirements in relation to experience and qualifications were not optional.
However, the Full Court disagreed with Wheelahan J’s construction of what is required in terms of experience and qualifications to fall within the Level 4 classification, and accepted the submissions of the applicant that the classification descriptors only prescribe a minimum requirement. That was based on an analysis of the structure and words used in the classification schedule, the text of the Award itself and the industry in which the Award operates.
The Full Court considered it particularly relevant that while other Levels in the classification structure have “ceilings” and the descriptors in Level 4 are evidently the “ceiling” for Level 3, there is no discernible “ceiling” for Level 4 (and, indeed, nothing in the classification Levels about swim coaches at all after Level 4).
In terms of the practical operation of the Award, their Honours considered the situation where an employee already covered by Level 4 coaches hours, or obtains qualifications, in excess of what is required by that classification. It would be nonsensical, in the view of the Full Court, for that employee to then fall outside the scope of Level 4 coverage.
Importantly, in reaching their conclusion, the Full Court placed little relevance on the history of the Award (despite the amount of time Wheelahan J had dedicated to that issue at first instance) noting at [87] that:
“There will of course be cases where the history of an industrial instrument sheds light on constructional choices presented by its text, so as to illuminate meanings that might otherwise be obscure. This is not one of those cases.”
It was emphasised by their Honours that given the risk of penalties for non-compliance, employers and employees in an industry should not need to know the industrial history of a modern award for it to be reasonably understood.
Observations
Although on the face of it this decision seems relevant to an interpretation of the classifications of the Award, it does have broader applicability to the exercise of fitting an employee’s role into an award classification.
It is notable that both Wheelahan J and the Full Court emphasised the importance of modern awards being accessible to those in the industry who use them. For that reason, employers should think twice before adopting an overly legalistic or complicated approach to fitting employees into an award classification. Although the history of an award will be relevant in some cases and particularly in the event of ambiguity, employers should not underestimate the importance of taking a broad or purposive approach to award interpretation, as well as taking the words used in a modern award classification at face value.
This case is also a reminder to employers that, when considering an appropriate classification for an employee’s experience and qualifications, consideration should be given to whether the next Level in the classification structure sets a clear “ceiling”. That will assist in avoiding questions about whether more senior employees fall out of scope.