Interpreting industrial instruments

Many employment disputes, particularly between unions and employers are about the meaning of enterprise agreements. This is how they are interpreted.

“The Principles Relevant to the Construction of the Enterprise Agreements

  1. At the heart of the appeal and cross-appeal is the proper construction and application of the relevant clauses in the enterprise agreements.  The primary judge set out the principles of construction in Qantas (No 2) (at [14]–[17]) and no complaint is made about his Honour’s statement of the relevant principles.
  1. In the circumstances, it is sufficient for me to refer to the following.
  1. In Kucks v CSR Ltd [1996] IRCA 166; (1996) 66 IR 182 (Kucks), Madgwick J said (at 184):

It is trite that narrow or pedantic approaches to the interpretation of an award are misplaced. The search is for the meaning intended by the framer(s) of the document, bearing in mind that such framer(s) were likely of a practical bent of mind: they may well have been more concerned with expressing an intention in ways likely to have been understood in the context of the relevant industry and industrial relations environment than with legal niceties or jargon. Thus, for example, it is justifiable to read the award to give effect to its evident purposes, having regard to such context, despite mere inconsistencies or infelicities of expression which might tend to some other reading. And meanings which avoid inconvenience or injustice may reasonably be strained for. For reasons such as these, expressions which have been held in the case of other instruments to have been used to mean particular things may sensibly and properly be held to mean something else in the document at hand.

But the task remains one of interpreting a document produced by another or others. A court is not free to give effect to some anteriorly derived notion of what would be fair or just, regardless of what has been written into the award. Deciding what an existing award means is a process quite different from deciding, as an arbitral body does, what might fairly be put into an award. So, for example, ordinary or well-understood words are in general to be accorded their ordinary or usual meaning.

  1. The Full Court of this Court observed in Transport Workers’ Union of Australia v Coles Supermarkets Australia Pty Ltd [2014] FCAFC 148; (2014) 245 IR 449 (TWU v Coles) that, although the observations in Kucks were made in dealing with the construction of awards, they apply equally to industrial agreements subject to one additional observation.   Enterprise agreements are agreements in name only and their construction should not proceed on the premise that they are a form of bargain between agreeing parties (TWU v Coles at [40]; Toyota Motor Corp Australia Ltd v Marmara [2014] FCAFC 84; (2014) 222 FCR 152 at [88]–[89]). In other words, because of the circumstances in which they are made and the consequences of contravention (i.e., penal consequences for contravention: s 50 of the FW Act), enterprise agreements have a legislative character.
  1. The main guides to construction are text, context and purpose and there is utility in bearing in mind the facts as they are known at the time the instrument is drafted (Amcor Limited v Construction, Forestry, Mining and Energy Union [2005] HCA 10; (2005) 222 CLR 241 at [2] per Gleeson CJ and McHugh J; at [30] per Gummow, Hayne and Heydon JJ; at [64] and [96] per Kirby J; at [129]–[131] per Callinan J; TWU v Coles at [46]; see also Herzfeld P and Prince T, Interpretation (2nd ed, Lawbook Co, 2020) at [16.160] et seq).”


Australian Licensed Aircraft Engineers Association v Qantas Airways Limited [2022] FCAFC 50 delivered 1 April 2022 per Besanko, Bromberg and Wheelahan J)