Industrial Relations Commission New South Wales

• Medium Neutral Citation: NSW Nurses' Association v Sydney Local Health District [2012] NSWIRComm 52
• Hearing dates: 22 May 2012; 31 May 2012
• Decision date: 27 June 2012
• Before: Boland J, President

Decision

The Court makes the following orders:

(a)The application for declaratory relief is refused.

(b)No order as to costs.

• Catchwords: DECLARATORY RELIEF - AWARDS - Claim by NSW Nurses Association on behalf of seven nurses for declaratory order that it was as an express contractual term of the nurses' employment, that they would not be rostered for night shift - Whether representations were made that nurses would not be required to work night shift - Whether representations constituted binding contractual obligation - Whether persons making representations had the authority to bind the employer - Delegation of power under Health Services Act 1997 - Presumption of regularity - Held application for declaratory relief refused
• Legislation Cited: Health Administration Act 1982; Health Service Act 1997; Industrial Relations Act 1996; Interpretation Act 1987; Public Hospitals Act 1929 (repealed)
• Cases Cited: Air Great Lakes Pty Ltd v K S Easter (Holdings) Pty Ltd (1985) 2 NSWLR 309; Crown in Right of the State of New South Wales (Director-General, NSW Department of Health) in respect of Sydney West Area Health Service v New South Wales Nurses' Association [2011] NSWIRComm 111; Director-General of Education v Suttling [1987] HCA 3; (1987) 162 CLR 427; Downe v Sydney West Area Health Service (No 2) [2008] NSWSC 159; (2008) 71 NSWLR 633; Ermogenous v Greek Orthodox Community of South Australia Inc [2002] HCA 8; (2002) 209 CLR 95 at [25]; Gillies v Health Administration Corporation [2003] NSWIRComm 243; Goldman Sachs JB Were Services Pty Ltd v Nikolich [2007] FCAFC 120; (2007) 163 FCR 62; GR Securities Pty Ltd v Baulkham Hills Private Hospital Pty Ltd (1986) 40 NSWLR 631; Health Administration Corporation v Crocker [2004] NSWIRComm 163; (2004) 138 IR 147; Hill v Woollahra Municipal Council [2003] NSWCA 106; (2003) 127 LGERA 7; Morris v Kanssen [1946] AC 459; Public Service and Professional Officers Association Amalgamated Union of NSW v Director of Public Employment [2011] NSWIRComm 152; Saad v TWT Limited [1998] NSWSC 199; State Rail Authority (NSW) v Heath Outdoor Pty Ltd (1986) 7 NSWLR 170; The Minister for Natural Resources v The New South Wales Aboriginal Land Council and anor (1987) 9 NSWLR 154
• Category: Principal judgment
• Parties: New South Wales Nurses Association (Applicant); Director-General of Health on behalf of the Sydney Local Health District (Respondent)
• Representation: Mr M Gibian of counsel (Applicant); Mr A Britt of counsel (Respondent)
• File Number(s): IRC 358 of 2012

JUDGMENT

1 On 21 February 2012, the New South Wales Nurses' Association notified the existence of an industrial dispute concerning seven members of the Association employed in nursing positions in the Medical Assessment Unit ("MAU") at Canterbury Hospital.

2 The dispute arose following advice by the Sydney Local Health District to the MAU nursing staff in December 2011 that they would be rostered on night shift from February 2012. The Association contended that each of the nursing staff had, as an express contractual term of their employment, a right not to be rostered for night shift and it was not open to the respondent to unilaterally change the terms of the contract. The respondent contended that no such contract was made and, in any event, it had a right under the Public Health System Nurses' and Midwives' (State) Award ("the Award") to transfer employees to night shift, subject to the terms of the Award.

3 The dispute was the subject of conciliation proceedings before the Commission on 22 February, 28 February and 15 March 2012. Attempts at conciliation were unsuccessful and the Commission determined the dispute should go to arbitration. In the meantime, the nursing staff at the MAU would continue to work two night shifts per month on a without prejudice basis in accordance with a Recommendation made by the Commission on 28 February, pending the outcome of the arbitration proceedings. A certificate of attempted conciliation was issued pursuant to s 135 of the Industrial Relations Act 1996.

4 The matter was listed for hearing on 27 April 2012. At that time the relief being sought by the Nurses' Association pursuant to s 136(1)(a), (b), (c) and/or (d) of the Act was as follows:

(a) A determination pursuant to s 175 of the Act that there exists a provision of the contract of employment of MAU nursing staff that provides that such staff cannot be required to work night shifts without their consent; and

(b) A determination pursuant to s 175 of the Act that this contractual provision is more favourable to the MAU nursing staff than the benefits conferred under the Award, and consequently prevails over the terms of the Award; and

(c) An award, direction or other order that the Respondent shall not roster the MAU nursing staff on night shift.

5 In its written submissions filed in the Commission the respondent contended the Commission was without jurisdiction to provide the relief sought. At the commencement of the proceedings on 27 April counsel for the Association indicated that whilst the respondent's contentions regarding the absence of jurisdiction were not accepted, the Association sought to amend its position by seeking declaratory relief and that pursuant to s 176 that the Commission reconstitute itself as the Industrial Court in order to hear and determine the declaratory relief application under s 154 (it being only the Court that could undertake such a function: s 153(1)(b)).

6 In light of the fact that the respondent had been advised of the Association's changed position only the day prior to the hearing and that the respondent was not represented by counsel, the Commission refused the Association's application to amend the relief and to reconstitute the Commission as the Court. Consequently, an adjournment was sought and granted.

7 The matter proceeded on 22 and 31 May and the Commission was reconstituted as the Industrial Court for the purpose of hearing and determining the Association's application for declaratory relief.

8 The amended relief sought was in the following terms:

1. An order declaring that it is a term of the contracts of employment of each of the following employees:

(a)Rekha Limbu;

(b)Jessy Manguzha;

(c)Kelvin Ozurumba;

(d)Budhisara Rai;

(e)Anna Raniga;

(f)Raylynn Singh;

(g)Ingrid Vidler.

that those employees not be rostered to work night shift without their consent whilst working in the medical Assessment Unit (MAU) at Canterbury Hospital.

2. An order declaring that this contractual provision is more favourable to the employees than the provisions of the Public Health Nurses' and Midwives' (State) Award and has effect in addition to the provisions of the Award.

Evidence

Applicant's evidence

9 For the applicant, four witness statements were tendered and each was required for cross-examination. The makers of the statements were: Ms Sandy Dealy, who was the Nurse Unit Manager for the MAU and for the Banksia ward (a medical ward) at Canterbury Hospital between April 2008 and August 2010; Mr Kevin (Kelvin) Ozurumba, registered nurse working in the MAU; Ms Jessy Manguzha, registered nurse working in the MAU; and Ms Ingrid Vidler, registered nurse working in the MAU.

10 The effect of Ms Dealy's evidence was that a decision was made on or around February 2008 by Canterbury Hospital to establish the MAU within the physical space of the Banksia ward and this would be a permanent arrangement. Further, that Ms Vicki Manning, who at the time was the Director of Nursing and Midwifery Services at Canterbury Hospital, made a decision that the nurses working in the MAU "will not need to work night duty just day and evening shift".

11 Ms Dealy said all of the nurses "hired for the MAU" by her were offered positions on the understanding coverage would be over seven days but only day and evening shifts would be required to be worked by the staff. The seven staff Ms Dealy advised that there would be no night shift in the MAU were Ms Vidler, Mr Ozurumba, Ms Rekha Limbu, Ms Anna Raniga, Ms Raylynn Singh, Ms Manguzha and Ms Budhisara Rai.

12 The effect of the evidence of Mr Ozurumba, Ms Vidler and Ms Manguzha was that they and the other four nurses currently employed in the MAU had been offered and had accepted employment in the MAU on the basis that they would not be required to work night shift. Without prior consultation the MAU nurses then received a letter dated 12 December 2011 advising them that a review of the Banksia staff profile and operational requirements had been undertaken and that it had been established that:

[T]o provide a safe level of care in the MAU and a fair distribution of shifts amongst all nursing staff, nurses working within the MAU will now be required to work on the 24 hour rotating roster which includes night duty.

This will take effect on the roster commencing 30th January 2012.

13 The evidence was that the nurses in the MAU objected to any requirement to work night shift. Their objections were made known to the respondent via Ms Hayley Sciuriaga, the Nurse Unit Manager ("NUM") who had replaced Ms Dealy. The nurses expressed concern at the respondent's failure to consult with them prior to giving notice of the change to their shift arrangements.

Respondent's evidence

14 For the respondent statements by the following persons were tendered: Ms Clair Harris, who up to October 2008 was the Acting Operational Nurse Manager at Canterbury, then Acting Director of Nursing and Midwifery Services (October to November 2008) and from November 2008 to the present, Director of Nursing and Midwifery Services; Ms Sciuriaga; and Ms Manning. Each of these persons was required for cross-examination.

15 Ms Manning's evidence in her written statement was relevantly that:

(a)in discussions with nursing staff Ms Manning advised them that the MAU was to be a new, model of care and indicated that it would be a roster comprising a day and afternoon shift. Ms Manning advised staff of the principles of how the MAU model was meant to function. Ms Manning further informed staff that the exact details of how the MAU would function at Canterbury Hospital would be determined when the medical governance was finalised. At no time did she indicate that staff would never again be required to work night shift;

(b)on or around early April 2008 Ms Manning drafted secondment letters to five staff to work in the MAU;

(c)Ms Manning authorised the secondment of nursing staff to the MAU. In her discussions with staff Ms Manning indicated that their transfer would be treated as a secondment because the establishment of the MAU was a newly model of care. As such this approach would enable them the future option of returning to their substantive positions. It was stated in the correspondence that they would be expected to commit to a minimum period of 6 months in the MAU;

(d)in or around July 2008 Ms Manning sought to recruit extra nursing staff;

(e)at no time in discussions with Ms Dealy did Ms Manning specify that nursing staff would be permanently allocated to the morning and evening shift and never again be required to work a night shift.

16 The main elements of Ms Harris' written statement were that:

(a) Ms Manning had advised her that initially the MAU would have 2 nursing staff for morning shift, and two for afternoon shift and medical registrar coverage between the hours of 0800 to 1630 hours. Further, there would be a single nursing staff member to be brought over from Banksia Ward for the night shift from 2130 to 0730 hours;

(b) Ms Harris had asked why they were using the Banksia staff for night duty and Ms Manning replied:

"The proposed roster would involve the night shift being covered by an employee from the Banksia Ward because at this time, staff are only seconded to the unit, and while the model is evolving, we will place the funded FTE for the night duty MAU staffing into Banksia until the unit is established. Eventually the MAU will have its own staff, 24/7 as per the funding arrangement and expectations of the Department of Health".

(c) Ms Harris was advised by Ms Manning that she had decided to second five employees, following their response to the Expression of Interest, from other wards at Canterbury Hospital. Ms Harris signed the secondment letters on behalf of Ms Manning for Mr Kevin Ozurumba, Ms Raylynn Singh, Ms Anna Raniga, Ms Rekha Limbu and Ms Ingrid Vidler. The secondment letter for the employees was identical identifying the commencement date of the MAU being 28 April 2008 and that staff would be seconded for a minimum period of 6 months.

(d) each of the nursing staff the subject of the dispute signed acceptances of offers of employment at various times between 1987 and 2004. The letters provided to the abovementioned employees are standard in nursing recruitment practices and were consistent with the Award conditions and obligations;

(e) in or around August 2011 Ms Harris had a discussion with Ms Sciuriaga. Ms Harris indicated a belief believe that the patients would have a greater continuity of care and improved safety if the MAU staff were caring for them 24 hours per day;

(f) Ms Harris determined that on the basis of safe and improved clinical management, in addition to issues of staff equity, a night shift should be introduced to the roster for the staff of the Medical Assessment Unit.

17 Ms Sciuriaga's evidence in her written statement was, inter alia, that:

(a) in or around the middle of 2011, Ms Sciuriaga had informal discussions with some staff who were working in the MAU as to why night shift was not being worked;

(b) Ms Sciuriaga started to make enquiries about the possibility of changing the roster;

(c) as a result of the safety and equity concerns Ms Sciuriaga sought advice from Human Resources at Canterbury Hospital about progressing a change for the roster and providing the requisite notice under the Award. In or around December 2011, Ms Sciuriaga began to draft a letter to staff indicating to them that she was planning to change the roster because of my safety concerns for patients and equity concerns for the staff because of how the roster was being worked.

18 It is to be noted that the oral evidence of Ms Dealy, Ms Manning and of Ms Harris was that they had no specific delegated authority from the Director General of Health, the Chief Executive of Sydney South West Health Authority or the General Manager of Canterbury Hospital to set terms and conditions of employment for nurses.

Applicant's evidence in reply

19 Ms Dealy, Mr Ozurumba, Ms Vidler and Ms Manguzha responded in writing to the statements of Ms Manning, Ms Harris and Ms Sciuriaga.

20 In response to Ms Manning's statement, Ms Dealy stated there was never any suggestion that non-working of night shift was a temporary arrangement.

21 In response to Ms Manning's statement, Mr Ozurumba stated that he was never told, "not working night shift wasn't a permanent arrangement."

22 Ms Manguzha said in reply that:

"I do not recall Vicky Manning at this discussion ever referring to the MAU as an evolving model of care. I do not recall her ever saying that the arrangements were temporary and that we would be required to work nights. I do recall her clearly stating that it was only morning and afternoon shift for anyone interested in working in MAU."

23 In Ms Vidler's reply she stated:

I had a discussion with Ms Sandy Dealy. I rely on my statement at paragraph 11 and I add that we had a discussion to the following effect:

She said: "The MAU staff will only be rostered on morning and afternoon shifts and Banksia staff will be covering the night shifts. A roster will come out and you will be able to make requests. I am going to be doing the roster. Do you have any requests for this roster?"

I said: "I don't have any requests for this roster but I do prefer mornings."

I remember I was more excited about the fact that I no longer had to do nights.

Submissions of the parties

Applicant

24 The parties each provided a written outline of their submissions, which were supplemented by oral submissions.

25 For the applicant the central contention was that the question of whether a representation made in connection with the employment of an employee has contractual force will depend upon an assessment of the intentions of the parties. Clear representations were made to the nurses who accepted positions within the MAU that their conditions of employment would be that they would not be required to work night shifts The intention of the parties is to be judged objectively and not by reference to the subjective understandings or beliefs of the parties: Ermogenous v Greek Orthodox Community of South Australia Inc [2002] HCA 8; (2002) 209 CLR 95 at [25]; Air Great Lakes Pty Ltd v K S Easter (Holdings) Pty Ltd (1985) 2 NSWLR 309 at 332-334; GR Securities Pty Ltd v Baulkham Hills Private Hospital Pty Ltd (1986) 40 NSWLR 631 at 634; Goldman Sachs JB Were Services Pty Ltd v Nikolich [2007] FCAFC 120; (2007) 163 FCR 62 per Black CJ at [23]; Public Service and Professional Officers Association Amalgamated Union of NSW v Director of Public Employment [2011] NSWIRComm 152 at [87]-[103]; State Rail Authority (NSW) v Heath Outdoor Pty Ltd (1986) 7 NSWLR 170; Saad v TWT Limited [1998] NSWSC 199.

26 Counsel submitted clear representations were made to the nurses who accepted positions within the MAU that their conditions of employment would be that they would not be required to work night shifts. The Commission should conclude that the parties intended (judged objectively) that the representations made that nurses employed in the MAU would not be required to work night shifts were intended to be contractually binding.

27 Reference was made to letters of appointment and documents setting out "terms and conditions of appointment" for the MAU nurses. The earlier documents relating to Nurses Ozurumba, Vidler, Limbu, Raniga and Singh, do not refer to hours of work at all other than noting that the hours of work will be 38 hours. To the extent that the documents provided to nurses upon commencement of employment referred to hours of work, it was by way of a generic position description which noted simply "rotating roster". These documents could not prevent subsequent agreement for particular conditions to apply upon taking up a new position. In respect of Nurse Rai, the position description signed by her did not contain any reference to working a rotating roster. This left room for agreement to be reached orally in relation to the hours of work to apply in the particular position and that is what occurred. Ms Manguzha did not have any letter of appointment or similar documentation.

28 It was submitted none of the terms of the Award entitled the employer to change working hours unilaterally.

29 It was next submitted there was nothing inconsistent with s116 or s116A of the Health Service Act 1997 in making it an express contractual term of employment that nurses in the MAU would not be required to work night shifts. It was further submitted:

To the extent that it is submitted that Ms Manning acted outside her authority, the Association and the Court are entitled to rely upon the presumption of regularity: Minister for Natural Resources v NSW Aboriginal Land Council (1987) 9 NSWLR 154 at 164; Sydney West Area Health Service v New South Wales Nurses' Association [2011] NSWIRComm 111 at [222]. Ms Manning and Ms Harris habitually undertook the task of approving the appointment of nurses and preparing and signing documentation which set out the conditions of employment of employees. The Court is entitled to infer that they were authorised to do so.

Respondent

30 The principal contention of the respondent was that there was no contractual term as alleged by the applicant since such a term did not comply with s116 and s116A of the Health Service Act. Essentially, the argument was that the employment function in the Health Service was vested in the Director-General and as the Director-General had not delegated the function of fixing employment conditions to Ms Manning, Ms Harris or Ms Dealy. Thus, no contract had been made as claimed by the applicant.

31 It was further submitted:

• there was no evidence that the proposed condition concerning no night shift without an employee's approval was made in accordance with Department of Health approval and policy.
• the proposed contractual term concerning no night shift without an employee's approval was not in accordance with the Award.

32 Counsel for the respondent made further submissions as follows:

• no representation of the nature alleged was made to Ms Rai;
• in respect of Ms Limbu, Ms Raniga, Ms Singh and Ms Vidler the Court should accept the evidence of Ms Manning that no representation was made that they would never have to work night shift;
• there was no evidence that any staff member was told that the provisions of the Award would not apply or the initial employees would never have to work night shift or that there was any discussion to that effect;
• even if the Court were to find representation was made there was no intention of the parties that the limitation on working night shift would form part of the contracts of employment of the employees.

Consideration

Whether representations were made

33 It is established that prior to the five seconded nursing staff (Mr Ozurumba, Ms Singh, Ms Raniga, Ms Limbu and Ms Vidler) moving to the MAU in April 2008, each of them worked on rotating rosters in the course of their employment that included shifts and did so in accordance with the terms of the Award. In the absence of any contradictory evidence I think that is sufficient to establish that the five staff were shift workers for the purposes of cl 4 of the Award prior to their appointment to the MAU. Up to that point, there was nothing to indicate that their status as shift workers excluded a requirement to work night shift.

34 In July 2008, it appears that Ms Rai was offered and accepted a position in the MAU. Ms Rai signed a document described as a "Job Description" that in having been selected for a position she "must be able to undertake rotating roster (unless otherwise specified)" and that in relation to her employment the applicable Award was the Public Health System Nurses' and Midwives' (State) Award. Ms Dealy said in her written statement:

I was on the interview panel for Sara [Ms Rai] and on the interview panel for Jessy.

During the interviews for Jessy Manguzha and Sara Rai some nursing scenarios were put to test how nurses responded using critical thinking and what skills they had.

I confirmed for the nurses at these interviews that the pattern of work offered at MAU was for morning and afternoon shifts only over seven days rotating.

35 The evidence of representations being made to Ms Rai is not as strong as it is in the case of the other six nurses. This is perhaps because Ms Rai did not provide a statement in the proceedings for the reason that the parties were requested to be economical about the evidence to be called. Nevertheless, Ms Dealy's evidence is that a representation was made to Ms Rai that "the pattern of work offered at MAU was for morning and afternoon shifts only over seven days rotating."

36 In 2009, Ms Manguzha worked in the MAU for six weeks. During that period she was not required to work night shift. Ms Manguzha was initially reluctant to take up a position in the MAU but following discussions with other nurses in the MAU in which she was told the MAU did not work night shifts and after being advised, in the course of an interview for the position, that she would not be required to work night shift, Ms Manguzha transferred to the MAU in May 2010. The advertisement for the MAU position answered by Ms Manguzha indicated the hours to be worked in the MAU were "am and pm", which was universally understood by the nurses to mean day and afternoon shift.

37 I find that representations were made to Ms Manguzha by Ms Dealy to the effect that there was no night shift in the MAU and that Ms Manguzha accepted a position in the MAU on the basis she would not be required to work night shift in the MAU.

38 In relation to the five staff that were seconded to the MAU, it may be taken that they accepted the position on the understanding it was a temporary placement. The letters advising each of the staff that their application to work in the MAU had been accepted, indicated that they were being seconded to the Unit. "Secondment" is defined in the online edition of the Macquarie Dictionary as "to transfer... temporarily to another post, organisation, or responsibility...." The five staff accepted the secondment based on representations made to them that they would not be required to work night shift whilst at the MAU. The evidence of Mr Ozurumba describes how Ms Manning made the representation:

I attended one of these forums along with all the nurses working on that day on Boronia - all nurses working the morning and afternoon shift attended the meeting. The meeting was held in the maternity ward (Waratah) education room. I think this meeting took place around the middle of February. The meeting lasted for 30 minutes. It was the first time we had the opportunity to ask first hand about how the MAU would function.

At this meeting Vicki Manning said to us that there would be no night shifts. She said words to the effect:

"The good side of it is there will be no night shifts. It will be staffed morning and afternoons. We have increased the full time equivalent in Banksia from three to four to cover for MAU at night. The staffing has been calculated for morning and afternoon to work in the MAU."

39 In her statement Ms Manning described the representations she made to the nursing staff regarding working hours in the MAU:

In those discussions I advised the nursing staff that this was to be a new, evolving model of care and indicated that initially it would be a roster comprising a day and afternoon shift. I advised staff of the principles of how the MAU model was meant to function. I further informed staff that the exact details of how the MAU would function at Canterbury Hospital would be determined when the medical governance was finalised. At no time did I indicate that staff would never again be required to work night shift.

40 However, under cross-examination Ms Manning conceded that she could not recall using the word "evolving model of care", nor could she recall using the word "initial". The seconded nurses did not recall Ms Manning mentioning an "evolving model of care" or that they would only "initially" be required to work day and afternoon shift. In addition, Ms Manning expressly stated that she could not "recall exactly the content" of the discussions and conceded in oral evidence that she did not have a clear recollection of the discussions.

41 The evidence of Ms Dealy supports those of the seconded nurses. Ms Dealy said in her statement:

I remember on or around February 2008 I had a meeting with Vicki Manning in her office at Canterbury hospital to discuss staffing arrangements for the MAU. We had a conversation to the following effect:

She said: "I have decided that the nurses working in MAU will not need to work night duty just day and evening shift."

I said: "Okay."

She said: "To cover MAU for night duty the Banksia ward will get more full time equivalents".

...

I remember in or about March 2008, Ingrid Vidler coming and talking to me and asking me questions. We had a conversation to the following effect:

She said: "I work night shifts and this will be an adjustment for me. I am looking forward to it".

I said: "It will be fine for you to come in and give it a try because you can always go back to your other position if you find it doesn't work for you - if you are not happy with the shift pattern or the work within the MAU."

I remember Kelvin Ozurumba, Rekha Limbu, Una, Anna Raniga and Raylynn Singh came to me because they had to come to me to get rostered. I reiterated with all the new MAU staff that there would be no night shift. I confirmed that the shifts were only for morning and afternoon. During talks with individual nurses around the time I had to organise the first roster for MAU I explained how the request roster was to work and I explained to them what they could request so that each of them would do it the same and use the existing guidelines to guide them in what they could request. They could not request nights which they already knew before they came to talk with me.

42 In addition, the advertisement seeking expressions of interest to work in the MAU included the notation referred to above to the effect that registered nurses and endorsed enrolled nurses would be required to work am and pm shifts. This was understood by the five nurses to indicate that the position did not involve a requirement to work on night shift.

43 I find that, in respect of the seven nurses, Ms Manning and/or Ms Dealy made representations to them to the effect that they would not be required to work night shift in the MAU.

44 Over the objection of the nursing staff in the MAU the employer decided, in December 2011, to change the shift arrangements within the MAU to require the nursing staff to work night shift.

45 The question is whether the representations made to the seven nurses, that nurses employed in the MAU would not be required to work night shifts, were intended by the parties to be contractually binding. In this respect, the authorities relied upon by counsel for the applicant are apposite. In Goldman Sachs JB Were Services Pty Ltd v Nikolich, Black CJ at [23] stated the principles as follows (see also Marshall J at [118]-[119]):

It is well established that if a reasonable person in the position of a promisee would conclude that a promisor intended to be contractually bound by a particular statement, then the promisor will be so bound. This objective theory of contract has been repeatedly affirmed as representing Australian law by the High Court. Thus, in Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 51; (2004) 219 CLR 165, 179, the Court said:

It is not the subjective beliefs or understandings of the parties about their rights and liabilities that govern their contractual relations. What matters is what each party by words and conduct would have led a reasonable person in the position of the other party to believe. References to the common intention of the parties to a contract are to be understood as referring to what a reasonable person would understand by the language in which the parties have expressed their agreement. The meaning of the terms of a contractual document is to be determined by what a reasonable person would have understood them to mean. That, normally, requires consideration not only of the text, but also of the surrounding circumstances known to the parties, and the purpose and object of the transaction.

46 Nikolich and other relevant authorities regarding intention to contract were considered at length in Public Service and Professional Officers Association Amalgamated Union of NSW v Director of Public Employment at [90]-[103]. I adopt what was there stated.

47 As the applicant submitted, the question is whether a reasonable person in the position of the employees who are subject of these proceedings would have concluded that the hospital intended to be bound by the representations made as to the shifts to be worked in the MAU. If so, the hospital will be so bound.

Whether those who made the representations had the authority to bind the employer

48 The respondent contended the representations made to the seven nurses, if found to have been made, could not be contractually binding because those who made the representations had no authority to bind the employer. Moreover, it was submitted, even if the Court were to find representation was made (in the terms of the applicant's proposed order), there was no intention of the parties that the limitation would form part of the contracts of employment of the employees.

49 The respondent acknowledged that the relevant terms of employment of the seven nurses may be determined partly by statute and partly by contract as well as by industrial instruments: see Gillies v Health Administration Corporation [2003] NSWIRComm 243 and, on appeal, Health Administration Corporation v Crocker [2004] NSWIRComm 163; (2004) 138 IR 147 at [32] and Downe v Sydney West Area Health Service (No 2) [2008] NSWSC 159; (2008) 71 NSWLR 633.

50 The respondent explained, correctly with respect, the operation of the Health Services Act in relation to the employment of the seven nurses:

The NSW Health Service consists of those persons who are "employed" under Part 1 of Chapter 9 of the Health Services Act. The "employer" functions are to be exercised by the Director-General (see s 116(3) of the Health Services Act) with some limitations (see s 116(3) of the Health Services Act). Each of the employees covered by the declaration were employed within the SLHD under Ch 9 of the Health Services Act. Under s 116(2) of the Act employment of staff in the New South Wales Health Service, including the exercise of employer functions in relation to that staff, is subject to the requirements of the Health Service Act or any other Act relating to that staff. Under 116(3) the Director-General, subject to sub-section 2, is to exercise on behalf of the Government of New South Wales the employer function to the Government in relation to the staff employed in the New South Wales Health Service. Under s 116A(1) the Director-General may fix salary, wages and conditions of employment of staff employed under Pt 9 insofar as they are not fixed by or under any other law. Under 116A(3) the Director-General may enter into an agreement with any association or organisation representing a group or class of members of the New South Wales Health Service with respect to the conditions of employment, including salaries, wages or remuneration of that group or class.

51 The respondent submitted there was no contractual term as alleged by the applicant since such a term did not comply with s116 and s116A of the Health Service Act. The staff of the Health Service are appointed pursuant to the Act and their rights must be ascertained by reference to its provisions, it was submitted. Any contract must be consistent with any statutory provision that affects the relationship. No agent of the Crown has authority to engage a servant on terms at variance with the statute (see Director-General of Education v Suttling [1987] HCA 3; (1987) 162 CLR 427 per Brennan J at 437).

52 The respondent submitted there was no evidence that the Director-General reached any agreement with any of the seven employees to limit their rostering arrangements contrary to the Award or authorised any such person on the Director-General's behalf to do that. Thus, there was no offer made pursuant to s116 or s116A of the Health Service Act or contractual term that complied with these sections.

53 The respondent submitted that the evidence was that neither Ms Manning, Ms Harris nor Ms Dealy had the delegated authority to set terms and conditions for the relevant employees and even if they did they were not empowered to create positions and/or determine conditions of employment that were not in accordance with Department of Health approval and policy or an award or determination.

54 Counsel for the respondent further submitted:

The statutory scheme does not permit the contractual terms claimed based upon alleged representations of Ms Manning and/or Ms Dealy. They are not the persons under the Health Service Act who have legislative ability to set the employees' terms and conditions of employment. On the evidence, there was no basis for concluding that there had ever been any intention on the part of the Director General to make the contract claimed with the employees.

55 The applicant would have it that the transaction between the respondent and the nurses, except Ms Rai, is to be categorised as an offer by the employer to change an aspect of the nurses' working conditions, namely, there would be no requirement to work night shift whilst in the MAU, and an acceptance of that offer, such transaction being contractually binding. In Ms Rai's case, it seems that what is put is that Ms Rai was employed on the basis of a preparedness to work a rotating roster (including night shift), but, as permitted by her contract of employment, it was specified she would not be required to work night shift in the MAU.

56 Under 116(3) of the Health Services Act, the Director-General, subject to ss 116(2), is to exercise on behalf of the Government of New South Wales the employer function for the Government in relation to the staff employed in the New South Wales Health Service. Under s 116A(1) the Director-General may fix salary, wages and conditions of employment of staff employed under Pt 9 insofar as they are not fixed by or under any other law. Under s 21 of the Health Administration Act 1982 the Director-General's functions under the Health Services Act or any other Act may be delegated to any person.

57 As the applicant contended, there is no evidence of the Director-General fixing employment conditions inconsistent with an agreed arrangement between the respondent and the seven nurses that the nurses would not be required to work night shift whilst working in the MAU. Thus, no inconsistency of the nature referred to in Suttling arises.

58 The respondent's central contention, however, was that neither Ms Harris, Ms Manning nor Ms Dealy were empowered to come to the arrangement they, or any one of them, did with the seven nurses because they did not have the necessary delegated authority to do so.

59 There was no written (or oral) authority in evidence indicating that the Director-General had delegated his or her authority to Ms Harris, Ms Manning or Ms Dealy to negotiate and agree to a contractually binding term of employment that the seven nurses would not be required to work night shift whilst working in the MAU.

Presumption of regularity

60 Accordingly, the applicant sought to rely on the presumption of regularity. The applicant submitted that Ms Manning and Ms Harris habitually undertook the task of approving the appointment of nurses and preparing and signing documentation that set out the conditions of employment of employees. It was submitted the Court was entitled to infer that they were authorised to do so. Presumably, in relation to Ms Dealy, the applicant contends that in orally advising Ms Rai and Ms Manguzha there would be no requirement to work night shift, Ms Dealy was merely the conduit for Ms Manning's authority.

61 The Interpretation Act 1987 at s 49 relevantly provides that:

49 Delegation of functions

(1) If an Act or instrument confers a power on any person or body to delegate a function, the person or body may, in accordance with the Act or instrument, delegate the function to a person or body by name or to a particular officer or the holder of a particular office by reference to the title of the office concerned.

(2) A delegation:

(a) may be general or limited,

(b) shall be in, or be evidenced by, writing signed by the delegator or, if the delegator is a body, by a person authorised by the body for that purpose, and

(c) may be revoked, wholly or partly, by the delegator.

(3) A delegated function may be exercised only in accordance with any conditions to which the delegation is subject.

(4) A delegate may, in the exercise of a delegated function, exercise any other function that is incidental to the delegated function.

(5) A delegated function that purports to have been exercised by a delegate shall, until the contrary is proved, be taken to have been duly exercised by the delegate.

(6) A delegated function that is duly exercised by a delegate shall be taken to have been exercised by the delegator.

...

62 In The Minister for Natural Resources v The New South Wales Aboriginal Land Council and anor (1987) 9 NSWLR 154 the Court of Appeal held that the presumption of regularity was applicable. McHugh JA stated at 164:

The Secretary of the Western Lands Commission was the holder of one of the prescribed offices. The Secretary had purported to grant the permissive occupancy to Mr Mooring. So the only question of the Secretary's authority which was outstanding was whether, in purporting to grant the occupancy, the Secretary was acting pursuant to a delegation by the Minister.

In my opinion, this was a classic case of the application of the maxim whose rationale was explained by Lord Simonds in Morris v Kanssen [1946] AC 459, a company case, where his Lordship said (at 475):

... one of the fundamental maxims of the law is the maximum 'omnia praesumuntur rite esse acta'. It has many applications ... the wheels of business will not go smoothly around unless it may be assumed that that is in order which appears to be in order.

The natural home of the maxim is public law. Where a public official or authority purports to exercise a power or to do an act in the course of his or its duties, a presumption arises that all conditions necessary to the exercise of that power or the doing of that act have been fulfilled. Thus a person who acts in a public office is presumed to have been validly appointed to that office: M'gahey v Alston (1836) 2 MNW 206 at 211; [1836] EngR 150; 150 ER 731 at 733; R v Brewer (1942) 66 CLR 435 at 548; Hardess v Beaumont [1952] VLR 315 at 318-319 and a council which must form an opinion as to whether there will be any detriment upon the granting of a planning permit is presumed to have formed the opinion before granting the permit: Pearce v City of Coburg [1973] VR 483. The maxim was applied in a statutory context in this court in Western Stores Ltd v Orange City Council [1971] 2 NSWLR 36 where objection was taken to the validity of the imposition of 'parking area rates' on the ground that the resolutions, which imposed the rates, did not recite that in the opinion of the Council certain works or services would be of special benefit to the areas rated. The formation of such an opinion was a pre-requisite to the valid exercise of the power to make the rate under the Local Government Act 1919, s 121. Moffitt JA, giving the judgment of the court, applied the maxim. His Honour said (at 46-47):

... as the case is one where the opinion required by s 121(1) was open to be held, it is to be presumed, in default of reason to conclude to the contrary, that the rate was regularly made and therefore was made upon the pre-requisite opinion having been formed ... . In applying the presumption, I do not think that any distinction should be drawn between the exercise of a power by an individual and the exercise of such a power by a body or group which acts by way of resolution, or vote.

63 Lord Simonds also said of the presumption in Morris v Kanssen [1946] AC 459 at 475:

It is a rule designed for the protection of those who are entitled to assume, just because they cannot know, that the person with whom they deal has the authority which he claims...

64 In Hill v Woollahra Municipal Council [2003] NSWCA 106; (2003) 127 LGERA 7 per Hodgson JA (Ipp JA and Davies AJA agreeing) said of the presumption at [52]:

The presumption is a presumption of fact, associated with a reasonable inference based on what ordinarily happens in the ordinary course of human affairs: see McLean Brothers & Rigg Ltd. v. Grice (1906) 4 CLR 835 at 849-51 per Griffiths CJ. In deciding whether the presumption of regularity is rebutted, this inference from the ordinary course of human affairs carries some weight, which may vary according to the proved circumstances.

65 As I have mentioned, in support of the applicability of the presumption in this case the applicant submitted, "Ms Manning and Ms Harris habitually undertook the task of approving the appointment of nurses and preparing and signing documentation which set out the conditions of employment of employees." The evidence relied upon in this respect included letters of appointment of Mr Ozurumba in 2001 and Ms Rai in 2008 signed by Ms Manning as Director of Nursing Services. The letters required the addressee to indicate by signature whether they accepted the appointments. Attached to the letters were terms and conditions of the appointment and the position description. Ms Manning also signed a letter of offer of employment to Ms Raniga in February 2004 "for Dr Diana Horvath, Chief Executive Officer of the Central Sydney Area Health Service". In 2010 Ms Harris signed off on a position description for Ms Manguzha. There was no letter of appointment in evidence in respect of Ms Manguzha.

66 The applicant also referred to Ms Manning's written statement where she said: "As the Director of Nursing and Midwifery the authority to appoint staff was under my delegation." However, in answer to a question from counsel for the respondent: "As the Director of Nursing at Canterbury Hospital had you received a delegation from the DirectorGeneral of Health authorising you to set terms and conditions of employment?" Ms Manning said "No". Ms Manning also answered in the negative as to delegations from the "Sydney South West Area Health Service CEO" and "general manager of Canterbury Hospital". Ms Harris answered the questions in the same way.

67 There were other statements in Ms Manning's evidence that the applicant claimed supported the presumption of regularity:

I determined the nursing staff profile of the Medical Assessment Unit. I determined that there would be approximately 6.5 full time equivalents to work a day and afternoon shift roster and an additional 1.8 full time equivalents to cover 1 additional nursing staff member on the Banksia Unit.

My decision to initially commence a rotating roster across only the morning and afternoon shifts over 7 days was because this mapped with the medical coverage for the MAU.

...

On or around early April 2008 I drafted secondment letters to five staff to work in the Medical Assessment Unit.

I authorised the secondment of nursing staff to the MAU. In my discussions with staff I indicated that their transfer would be treated as a secondment because the establishment of the MAU was a newly evolving model of care. As such this approach would enable them the future option of returning to their substantive positions. It was stated in the correspondence that they would be expected to commit to a minimum period of 6 months in the MAU.

68 The position description of Ms Manning's position of Director of Nursing was in evidence. Under the heading "HUMAN RESOURCE MANAGEMENT" the description stated, inter alia:

• Recruit suitable qualified nurses within the available resources
• Establish and monitor, in liaison with Nursing Unit Managers, the nurse staffing requirements for each unit in accordance with activity data and available resources

69 The applicant referred to a "Delegations Manual" that was in evidence. The Manual purportedly conferred authority upon the Director of Nursing to sign off on the appointment of staff. The applicant submitted that in the context of the evidence of the practices of the Hospital, this must be taken to include the capacity to negotiate the terms and conditions of employment of those employees, subject to any "fixation" by the Director-General. It was further submitted:

The Delegations Manual contains no other delegation to negotiate terms and conditions of employment. If the Delegations Manual were understood any other way, it would be necessary for the Director-General to directly negotiate terms and conditions of employment with each employee throughout the Health Service. That is self-evidently absurd.

The employment of an individual employee and the negotiation of the conditions of employment for that employee does not constitute the "fixation" of salary, wages and conditions of employment "of staff employed under this Part" for the purposes of s 116A of the Health Services Act. Section 116A is referring to the "fixation" of salary, wages and conditions of employment applying the staff employed under the Part generally not to the engagement of individual employees. The Area Health Service was separately conferred with capacity to make "contracts" (Health Services Act 1997, s 37(1). If a relevant "fixation" of salary, wages and conditions of employment had been made which was inconsistent with the contract said to exist, a question might arise: see Sydney West Area Health Service v New South Wales Nurses' Association [2011] NSWIRComm 111 at [40]. However, that is not this case. As has been mentioned, there is no evidence that any such fixation of conditions of employment by the Director-General has occurred.

If Ms Manning and Ms Harris acted outside their authority in purporting to negotiate the terms and conditions of employment, the employees are not bound by the terms and conditions agreed. For example, the employees are not bound by the code of conduct, privacy and confidentiality obligations, to perform the duties in their position descriptions or undertake performance reviews because Ms Manning or Ms Harris had no authority to so determine. Again, the Court would not infer such an extraordinary result from the material put forward by the respondent and it is surprising the respondent advances the submission.

70 In seeking to rebut the presumption the respondent relied, obviously, on the evidence of Ms Manning and Ms Harris that they had not received any relevant delegation authorising them to set terms and conditions of employment. The respondent also relied on the "Delegations Manual". The Manual sets out the delegations made by the Chief Executive of Sydney South West Area Health Service (the predecessor organisation to the respondent) to various staff for the period following October 2007. The purpose of the Manual was to detail:

(a) the authority of the Chief Executive;

(b) the authority delegated by the Chief Executive to specified staff positions and various committees; and

(c) the authority delegated by the Chief Executive to incur expenditure to specified staff positions and various committees.

71 The Manual provided that: a delegation could not be transferred by the delegate; a delegation may apply to a person acting in a position; and that it applied to Canterbury Hospital.

72 The respondent referred to the delegations in the Manual concerning human resources and payroll matters in Part 7. Part 7.1 provided the following notation under the heading "Regrading of positions at any level":

Under no circumstances are public health organisations to create positions and/or determine conditions of employment that are not in accordance with:

(i)Department of Health approval and policy.

(ii)An award or determination.

73 The respondent submitted that even if Ms Manning and Ms Harris did have the power to set conditions of employment (which was denied) such a power was restricted by the notation above. In that respect it was submitted there was no evidence that the proposed condition concerning no night shift without an employee's approval was made in accordance with Department of Health approval and policy and further, the proposed contractual term concerning no night shift without an employee's approval was not in accordance with the Award.

74 But for the delegation issue, which I shall address shortly, I would have come to the view that in respect of each of the seven nurses that are the subject of these proceedings it was a term of their contract of employment not be rostered to work night shift without their consent whilst working in the Medical Assessment Unit (MAU) at Canterbury Hospital.

75 As far as I have been able to ascertain, nothing in the Award would give the employer the right to unilaterally dispense with or overrule the variation to the employment contract. There is nothing in the hours clause, for example, or the clause dealing with rosters that provides the employer with the unilateral right to direct employees who have agreed with the employer they will not be required to work night shift whilst placed in a particular unit, to henceforth work night shift in that unit.

76 Clause 8(iii) of the Award does provide that:

Notwithstanding the foregoing provisions of this clause, a roster may be altered at any time to enable the nursing service of the public hospital or public health organisation to be carried on where another employee is absent from duty on account of illness or in an emergency: Provided that where any such alteration involves an employee working on a day which would otherwise have been such employee's day off, the day off in lieu thereof shall be as mutually arranged.

77 The fact that the Award only gives the employer the right to alter a roster at any time where another employee is absent from duty would suggest that otherwise there is no such right.

78 Clauses 8(i) and (ii) of the Award provide:

(i) The ordinary hours of work for each employee, other than the Director of Nursing, shall be displayed on a roster in a place conveniently accessible to employees.

(ii) The roster shall be displayed at least two weeks prior to the commencing date of the first working period in the roster.

79 In my opinion, these provisions are directed at normal rostering arrangements where the nurses have accepted they are on a rotating roster and that changes will be made from time to time in the normal roster cycle applicable to their place of work. The provisions are not intended to provide the employer with a unilateral right to significantly alter the hours of work of a group or class of employees contrary to a term of the employment contract.

80 Reference was made to cl 46(i) of the Award, Labour Flexibility, which provides:

(i) An employer may direct an employee to carry out such duties as are reasonable and within the limits of the employee's skill, competence and training provided that such duties are not designed to promote deskilling.

81 Clause 46 was not meant to and could not be construed as giving the employer the right to impose hours of work arrangements at will. For example, it would not be open to an employer to direct a day worker to work continuous night shift on the basis of cl 46. The clause was originally designed to overcome demarcations in the federal Metal Industry Award that had developed in metal and engineering workshops between award classifications, to promote multiskilling and to provide the employer with more flexibility to deploy workers in such a way as to make the most of their skills, competence and training; it had nothing to do with working hours. The clause has been adopted in the Award without modification.

Delegation issue

82 That brings me to the delegation issue. The Director-General is for relevant purposes the employer: s 116(3) of the Health Services Act. It is the Director-General who may fix the salary, wages and conditions of employment of staff employed under Pt 1 of Ch 9 of the Health Services Act in so far as they are not fixed by or under any other law. To "fix" salary, wages and conditions of employment means to settle definitely or set those things or determine what they shall be. Section 21 of the Health Administration Act, enables the Director-General to delegate his or her functions under the Health Services Act to any person. The section provides:

21 Delegation

(1) The Minister, Director-General or Corporation may, by instrument in writing, under seal (in the case of the Corporation), delegate such of their functions (other than this power of delegation) conferred or imposed by or under this or any other Act as are specified in the instrument to any person, and may, by such an instrument, revoke wholly or in part any such delegation.

(2) A delegation under subsection (1) may be made to:

(a) a specified person (whether a natural person or a corporation), or

(b) a person for the time being holding a specified office.

(3) Except in so far as the instrument of delegation otherwise provides, a person to whom a function has been delegated under subsection (1) may:

(a) in the case of a natural person-by writing under the person's hand, or

(b) in the case of a corporation-by writing under its seal,

authorise another person to exercise the function so delegated, and may, in like manner, revoke wholly or in part any such authority.

(4) An authority under subsection (3) may be given to:

(a) a specified person, or

(b) a person for the time being holding a specified office.

...

There are no relevant regulations.

83 Section 49(5) of the Interpretation Act provides that a delegated function that purports to have been exercised by a delegate shall, until the contrary is proved, be taken to have been duly exercised by the delegate. Thus, any presumption of regularity is rebuttable.

84 There was no instrument of delegation in evidence from the Director-General giving authority to Ms Manning, Ms Harris and Ms Dealy to set terms and conditions of employment. The evidence of Ms Manning, Ms Harris and Ms Dealy was that they had received no delegation from the Director-General authorising them to set terms and conditions of employment.

85 In my opinion, to alter a contract of employment to provide for no requirement to work night shift without the nurse's consent is to set or fix a condition of employment. The evidence of Ms Manning, Ms Harris and Ms Dealy that they had received no delegation from the Director-General authorising them to set terms and conditions of employment weighs against the presumption of regularity applying in this case.

86 It was submitted for the applicant that Ms Manning and Ms Harris habitually undertook the task of approving the appointment of nurses and preparing and signing documentation, which set out the conditions of employment of employees and, therefore, the Court was entitled to infer that they were authorised to do so.

87 The documents referred to were in the main letters of confirmation of appointment. In Mr Ozurumba's case, for example, the letter, signed by Ms Manning, stated: "I am pleased to confirm you have been successful in your application for the abovementioned position...." In signing the letter Ms Manning was not fixing conditions of employment. Ms Manning was merely conveying to Mr Ozurumba what were to be his conditions of appointment if he accepted them by signing in the space provided. These conditions were attached to the letter in what appeared to be a standard format.

88 Ms Manning did sign a letter dated 7 July 2008 to Ms Rai that purported to be an offer of employment. The letter was signed "for and on behalf of the Director-General NSW Department of Health". That would seem to be a recognition on Ms Manning's part that she had no authority to make offers of employment in her own name. How Ms Manning was able to sign for and on behalf of the Director-General was not explained

89 In any event, the fact Ms Manning conveyed an offer to Ms Rai of employment by "the Government of NSW" is not conclusive evidence of the fixing of conditions of employment by Ms Manning. It may have been the case, and probably was, that the employment conditions offered had been fixed by the Award and in accordance with the Health Service's policies. The fact that Ms Manning signed for the Director-General tends to indicate she did not fix the conditions of employment.

90 I note that on 2 February 2004 Ms Manning signed a letter of offer of employment to Ms Raniga. The letter was signed by Ms Manning "for Dr Diana Horvath AO" who at the time was Chief Executive Officer of the Central Sydney Area Health Service. In what circumstance Ms Manning was able to sign for Dr Horvath was not explained. However, the terms and conditions of employment for Ms Raniga were in a standard form and very similar to those applicable to Ms Rai. The fact that Ms Manning signed for Dr Horvath tends to indicate Ms Manning did not fix the conditions of employment.

91 The applicant referred to Ms Manning's position description and the fact it gave Ms Manning the responsibility to "recruit suitable qualified nurses within available resources." Recruitment of nurses is not the same thing as fixing their employment conditions.

92 Nowhere in Ms Manning's evidence did she claim that her authority extended to fixing conditions of employment. Ms Manning was clearly under the impression, albeit wrongly so, that the Award enabled the Hospital to dictate whether a nurse was to work night shift and that that did not amount to fixing an employment condition by way of a variation to employment contracts. Further, the claim by Ms Manning that she had the authority to appoint staff does not necessarily amount to a proposition that in doing so she had authority to fix their conditions of employment.

93 Reference was made to the Delegations Manual. The Manual details the authority of the Chief Executive of Sydney South West Area Health Service and the authority delegated by the Chief Executive to specified staff. One would not regard it as an instrument of delegation made under s 21 of the Health Administration Act because it purports to be an exercise of power under the Public Hospitals Act 1929 (repealed). The Manual is also not a "Policy Directive" made pursuant to s 116A(1) of the Health Services Act given that there is no reference in it to delegations by the Director-General. The Manual appears to be merely a statement of policy without statutory force related to a condition of subsidy: see Crown in Right of the State of New South Wales (Director-General, NSW Department of Health) in respect of Sydney West Area Health Service v New South Wales Nurses' Association [2011] NSWIRComm 111 at [46]-[48].

94 If the Manual was a valid instrument of delegation delegating the Director-General's authority to the Chief Executive and in turn the Chief Executive's authority to specified persons it would show conclusively that Ms Manning as a Director of Nursing at Canterbury Hospital had no delegated authority to fix conditions of employment. Nowhere in the Manual does it permit a Director of Nursing (categorised in the Manual as a "Service Manager - Facility Based") to fix employment conditions by the negotiation of contracts of employment with individual nursing personnel.

95 The applicant sought to rely on the function of "Signing of Confirmation of Appointment Letters" for "Other Positions" by "Service Managers" to contend that Ms Manning could make an agreement with nurses to vary their contracts of employment to provide that they would not be required to work night shift without their consent. It does not follow that such a function encompasses the fixing of conditions of employment under an employment contract and in my opinion, in the absence of evidenc to the contrary, signing confirmation of appointment letters does not amount to fixing employment conditions.

96 The applicant further contended that unless the Delegations Manual was accepted as providing Ms Manning with the authority to negotiate employment conditions it would lead to the absurd result that the Director-General would be required to "directly negotiate terms and conditions of employment with each employee throughout the Health Service." I cannot accept that contention. The conditions of employment of nurses in the public health system are in large measure fixed by an award. Other conditions may be fixed by the Director-General or by his or her delegates. It would be a matter for the Director-General to determine who were to be the authorised delegates to fix those conditions (including by agreement with relevant staff). Thus, if one were to take the Delegations Manual as a guide (and it would appear the Manual reflected the practice) the authority to offer and approve a voluntary redundancy package to an employee was limited to the Chief Executive of an Area Health Service or the Director Clinical Operations, who under s 21 of the Health Administration Act could sub-delegate the authority, subject to the extent of their delegated authority. It would not be a case of the Director-General being required to directly negotiate terms and conditions of employment with each employee throughout the Health Service.

97 What may border on the absurd would be if Directors of Nursing in hospitals were delegated with authority to negotiate the terms of employment contracts with individual nurses. That would lead to a chaotic situation.

98 Whilst the Delegations Manual is not an instrument of delegation under the Health Services Act it would appear to reflect the practice and adds weight to the respondent's case that it did not intend to enter into a binding contract with the nurses regarding no requirement to work night shift because it tends to indicate that if the Manual had been a valid instrument of delegation Ms Manning would not have had the authority to enter into such a contract.

99 It seems to me that there is sufficient evidence to the contrary to prove that the necessary pre-condition for Ms Manning to enter into the claimed binding contractual arrangement with the five secondees, namely, delegated authority to do so, did not exist. That being so, and as Ms Dealy made her representations only on the basis of Ms Manning's instructions, Ms Dealy had no authority to make the representation that there would be no requirement to work night shift in the MAU.

100 Ms Harris' position is indistinguishable from that of Ms Manning. She did not receive any relevant delegated authority to fix conditions of employment for Ms Manguzha and the high probability was that no relevant delegation was made to her.

101 As there is no evidence that Ms Manning, Ms Harris or Ms Dealy had the authority to fix conditions of employment or did do so as a matter of course in their dealings with nursing staff and as the evidence tends to show no authority existed, it cannot follow that in the "ordinary course of human affairs" it is to be presumed these individuals had the authority to fix employment conditions by entering into binding contracts of employment with individual nurses.

102 Moreover, the notion of Directors of Nursing and Midwifery Services, Directors of Nursing or Nursing Unit Managers having a general authority to negotiate contracts or variations to contracts fixing employment conditions for individual nurses is inconsistent with the scheme of the Health Services Act. It is the Director-General who may, subject to s 116A(1), fix the salary, wages and conditions of employment of staff subject to that function, or part of it, being delegated in accordance with s 21 of the Health Administration Act. A purpose of such a scheme must be to ensure a high measure of consistency in a large and diverse public sector organisation.

Concluding remarks

103 The state of affairs is quite unsatisfactory. Seven nurses were promised they would not be required to work night shift whilst in the MAU. That promise was made without authority, which means that it is not a binding contractual obligation on the respondent. Now the respondent is proposing to impose a night shift on the nurses, which it is entitled to do because the contracts of employment of each of the nurses requires them to undertake rotating shifts.

104 This has created discontent amongst the nurses within the MAU at Canterbury Hospital. I think the respondent should confer in good faith with the applicant as to what means might be available to avoid ongoing disharmony within the MAU.

Orders

105 The Court makes the following orders:

(a) .The application for declaratory relief is refused.

(b) No order as to costs.

**********

Decision last updated: 27 June 2012