Court of Appeal Supreme Court New South Wales

• Medium Neutral Citation: Director-General, Department of Premier & Cabinet v HSUeast [2012] NSWCA 111
• Hearing dates: 30 January 2012
• Decision date: 01 May 2012
• Before: Bathurst CJ at [1]; Basten JA at [14]; Barrett JA at [15]

Decision

1. Application dismissed.

2. Applicant to the pay the costs of the first and second respondents.

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

• Catchwords: JUDICIAL REVIEW - Decision of Industrial Relations Commission of NSW - 2.5 per cent salary increase in public health sector employee award - application of Industrial Relations (Public Sector Conditions of Employment) Regulation 2011 - whether decision of Commission reserved right to seek future variation of award - whether jurisdictional error.
• Legislation Cited: Industrial Commission Rules 1996 r 14; Industrial Relations Act 1996 s 16, s 17, s 146C; Industrial Relations (Public Sector Conditions of Employment) Regulation 2011 reg 6; Supreme Court Act 1970 s 48, s 69
• Cases Cited: Attorney General for State of NSW v Quin [1990] HCA 21; (1989) 170 CLR 1; Health Services Union v Director-General NSW Department of Health [2010] NSWIRComm 42; (2010) 193 IR 359
• Category: Principal judgment
• Parties: Director-General, Department of Premier and Cabinet (Applicant); HSU East (First Respondent); Australian Salaried Medical Officers' Federation (NSW) (Second Respondent); Director-General Ministry of Health (Third Respondent); Industrial Relations Commission of New South Wales (Fourth Respondent)
• Representation: Counsel; P Kite SC and M Easton (Applicant); A Moses SC and J Murphy (First and Second Respondents); Solicitors; Crown Solicitors (Applicant); Slater and Gordon (First and Second Respondents)
• File Number(s): 2011/369602

Decision under appeal

• Citation: Health Employees Conditions of Employment (State) Award and other Awards [2011] NSWIRComm 129
• Date of Decision: 2011-09-27 00:00:00
• Before: Boland J, President, Haylen J, Connor C
• File Number(s): IRC 1159 of 2011; IRC 1178 of 2011; IRC 1179 of 2011; IRC 1180 of 2011; IRC 1181 of 2011; IRC 1182 of 2011; IRC 1183 of 2011; IRC 1184 of 2011; IRC 1185 of 2011; IRC 1186 of 2011; IRC 1187 of 2011; IRC 1188 of 2011; IRC 1189 of 2011; IRC 1190 of 2011; IRC 1191 of 2011; IRC 1192 of 2011; IRC 1193 of 2011; IRC 1194 of 2011; IRC 1195 of 2011; IRC 1196 of 2011; IRC 1197 of 2011; IRC 1198 of 2011; IRC 1236 of 2011; IRC 1237 of 2011

Judgment

1 BATHURST CJ: These are proceedings brought by the Director-General, Department of Premier and Cabinet ("the applicant") seeking a declaration that orders made by the fourth respondent, the Industrial Relations Commission of NSW ("the Commission") in Health Employees Conditions of Employment (State) Award and other Awards [2011] NSWIRComm 129 ("the proceedings") is of no effect. Alternatively, the applicant seeks an order in the nature of certiorari quashing the orders made in the proceedings. The application was brought pursuant to the provisions of s 69(1), s 48(2)(d) & (e) of the Supreme Court Act 1970.

2 The order in question was to the following effect:

"(1)Each of the Awards listed in Annexure A to this Decision is varied in the terms of the relevant amended application filed by HSUeast on 16 August 2011.

(2)The variations shall take effect from the beginning of the first pay period to commence on or after 1 July 2011."

Annexure A sets out a series of awards generally relating to employees in the public health sector. The first respondent ("HSU"), who was the applicant for those awards, is an industrial organisation of employees in that sector. The applications referred to in the orders sought increases of 2.5 per cent in rates of pay and allowances in various awards in the health care sector, the increase stated to be to "provide for salary variations permitted in accordance with the NSW State Government's 'NSW Public Sector Wages Policy 2011'".

3 The applicant's principal contention was summarised in par [37] of its written submissions as follows:

"In Health Employees Conditions of Employment (State) Award and other Awards [2011] NSWIRComm 129 the Fourth Respondent found it could make orders awarding a 2.5% salary increase and allow the First Respondent's additional claims to be heard in a later hearing to determine the extent to which, if any, wages and salaries could be increased beyond 2.5 per cent. In doing so the Fourth Respondent has acted beyond its jurisdiction and the orders made by the Fourth Respondent on 27 September 2011 are inconsistent with Regulation 6(1)(d) and have no effect pursuant to s 146D(3) of the Industrial Relations Act."

4 The issue of whether the Commission could, within jurisdiction, make an order awarding a 2.5 per cent salary increase, whilst reserving the right for additional claims for a greater increase to be heard at a later time, would depend on the interrelationship of ss 16 and 17 of the Industrial Relations Act 1996 ("the Act") with s 146C of the Act and reg 6 of the Industrial Relations (Public Sector Conditions of Employment) Regulation 2011 ("the regulations"). Section 146C of the Act so far as relevant provides as follows:

"146CCommission to give effect to certain aspects of government policy on public sector employment

(1)The Commission must, when making or varying any award or order, give effect to any policy on conditions of employment of public sector employees:

(a)that is declared by the regulations to be an aspect of government policy that is required to be given effect to by the Commission, and

(b)that applies to the matter to which the award or order relates.

(2)Any such regulation may declare a policy by setting out the policy in the regulation or by adopting a policy set out in a relevant document referred to in the regulation.

(3)An award or order of the Commission does not have effect to the extent that it is inconsistent with the obligation of the Commission under this section.

...

(7)This section has effect despite section 10 or 146 or any other provision of this or any other Act."

5 Reg 6, so far as relevant, is in the following terms:

"6Other policies

(1)The following policies are also declared, but are subject to compliance with the declared paramount policies:

(a)Public sector employees may be awarded increases in remuneration or other conditions of employment that do not increase employee-related costs by more than 2.5% per annum.

(b)Increases in remuneration or other conditions of employment that increase employee-related costs by more than 2.5% per annum can be awarded, but only if sufficient employee-related cost savings have been achieved to fully offset the increased employee-related costs. For this purpose:

(i)whether relevant savings have been achieved is to be determined by agreement of the relevant parties or, in the absence of agreement, by the Commission, and

(ii)increases may be awarded before the relevant savings have been achieved, but are not payable until they are achieved, and

(iii)the full savings are not required to be awarded as increases in remuneration or other conditions of employment.

...

(d)Awards and orders are to resolve all issues the subject of the proceedings (and not reserve leave for a matter to be dealt with at a later time or allow extra claims to be made during the term of the award or order). However, this does not prevent variations made with the agreement of the relevant parties."

6 The applicant contends the Commission had no power to make an award whilst reserving the right to the HSU and the second respondent Australian Salaried Medical Officers Federation (NSW) ("ASMOF") to make additional claims because of the provisions of reg 6(1)(d), which requires awards to resolve all issues the subject of the proceedings.

7 However, a threshold question which arises is whether the Commission made an order of the nature complained of.

Procedural background

8 On 2 February 2011 the HSU filed an application to vary the awards listed in Schedule A to the application by increasing rates of pay by 6 per cent.

9 Section 146C and reg 6 commenced operation in June 2011. On 2 July 2011 and 30 June 2011 respectively, HSU and ASMOF filed new applications to increase rates of payments and allowances by 2.5 percent. There was a separate new application in relation to each relevant award. The applications provided for a "No Extra Claims" clause in the awards. This is commonly understood to refer to provisions designed to prevent changes to the award during its currency: Health Services Union v Director-General NSW Department of Health [2010] NSWIRComm 42; (2010) 193 IR 359 at [42]-[43]. The July 2011 applications were amended by the filing of amended applications by HSU on 16 August 2011 and subsequently by ASMOF. The amended applications sought a similar 2.5 per cent increase but did not contain a "No Extra Claims" clause. The significance of this was said to be that it effectively reserved a right to seek a variation of the award. Be that as it may, the amended applications did not foreshadow the making of any claims beyond those expressly made in them.

Consideration

10 It follows from the procedural history to which I have referred above, that all the Commission had before it at the time it made the orders was the amended application seeking an increase of 2.5 percent in pay and allowances. That is what the Commission ordered. There is no issue that it had jurisdiction to make such an award.

11 However, in the course of its determination the Commission considered the question of whether it had the jurisdiction to make an interim award. It concluded that a two-stage process involving interim increases was permissible (Decision par [42]-[46]). Notwithstanding this, the orders of the Commission are not, in their terms, cast in the form of an interim award. They simply give effect to what the Commission was empowered to do, namely grant a 2.5 per cent increase in pay and allowances.

12 In these circumstances, the order made was an order within jurisdiction. The fact that the Commission, during the course of its reasoning process, expounded the possibly erroneous view that notwithstanding reg 6(1)(d) it had a general power to vary the award in the future does not affect the position. In this regard it is important to remember that the subject matter of the review is not the steps taken preliminary to the exercise of the power to make an award, but the legality of the award itself: c/f Attorney General for State of NSW v Quin [1990] HCA 21; (1989) 170 CLR 1 at 26.

13 In these circumstances, in my opinion, the order made was within jurisdiction. There is no application for prohibition and no suggestion that there is any application pending to vary the award. The question of whether the Commission has power to vary the award in the manner it suggested can be dealt with when the question arises. It follows that the application should be dismissed. The applicant should pay the costs of the first and second respondents.

14 BASTEN JA: I agree with the orders proposed by the Chief Justice; I also agree with his reasons.

15 BARRETT JA: I agree with the Chief Justice and would add only this. The twenty-three amended applications filed by HSU on 16 August 2011 continued twenty-three separate proceedings each of which had been commenced in July 2011 by the filing of an application in accordance with rule 14 of the Industrial Commission Rules 1996. Each of the twenty-three proceedings related to a single award. There was a separate application (also subsequently amended) by ASMOF in relation to another award. All of the amended applications were determined by the Commission's decision of 27 September 2011. In none of the proceedings was the limit imposed by clause 6(1)(a) of the Industrial Relations (Public Sector Conditions of Employment) Regulation 2011 exceeded; and in every case the Commission's decision, consistently with clause 6(1)(d), resolved all issues the subject of the particular proceeding. To the extent that any claim in the application filed on 2 February 2011 may in future be pressed by the applicant thereunder, it will be for the Commission to deal with that matter according to law.

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Decision last updated: 01 May 2012