Re Donald Mcd0nald; the Secretary, Building Workers' Industrial Union of Australia, New South Wales Branch v Dylalo Pty Limited T/As Alpine Erections [1992] FCA 299 (25 June 1992)

FEDERAL COURT OF AUSTRALIA

Re: DONALD McD0NALD; THE SECRETARY, BUILDING WORKERS' INDUSTRIAL UNION OF
AUSTRALIA, NEW SOUTH WALES BRANCH
And: DYLALO PTY LIMITED T/AS ALPINE ERECTIONS
No. N I17 of 1991
FED No. 443
Industrial Law

COURT

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY
INDUSTRIAL DIVISION
Einfeld J.(1)

CATCHWORDS

Industrial Law - interpretation of travel allowance provision in National Building and Construction Industry Labourers (On Site) Award 1986 - interpretation of award - travel across county borders from home to work - whether award ambiguous

Commonwealth Industrial Relations Act 1988

Pickard v John Heine and Son Ltd [1924] HCA 38; (1924) 35 CLR 1

Canberra Television Ltd v Australian Theatrical and Amusement Employees Association (1979) 24 ALR 529

Simpson v Australian Telecommunications Commission [1978] FCA 41; (1978) 34 FLR 337

Australian Workers' Union v Abbey (1939) 40 CAR 494

Building Workers Industrial Union of Australia v A.L. Ackland Ltd (1946) 56 CAR 238

The Amalgamated Society of Carpenters and Joiners of Australia v Adelaide Joinery Works (1962) 101 CAR 433

The Amalgamated Society of Carpenters and Joiners of Australia v A.L. Ackland (1967) 118 CAR 197

Geo A. Bond and Co Ltd (In Liquidation) v McKenzie (1929) AR (NSW) 498

Carpenters and Joiners and Bricklayers, Construction (State) Award (1960) AR (NSW) 694

Printing and Kindred Industries Union v Davies Bros Ltd (1986) 18 IR 444

Gregory v Philip Morris Ltd [1988] FCA 100; (1988) 24 IR 397

Bell v Gillen Motors Pty Ltd (1989) 27 IR 324

City of Wanneroo v Holmes [1989] FCA 369; (1989) 30 IR 362

Kirkness v John Hudson and Co Ltd (1955) AC 696

The Operative Painters and Decorators Union of Australia v Australian Federation of Construction Contractors (Nos 2763/74 and 2158/75, Evatt J unreported but digested in 17 AILR(1975) para F 377); (1975) 168 CAR 8 9 (leave to appeal refused)

Girvan Bros Pty Ltd and Civic Constructions Pty Ltd v The Building Workers' Industrial Union of Australia (20 October 1988, Commissioner Bennett - Print H5215)

Application by the Master Builders' Association of New South Wales for an Interpretation of the Building and Construction Industry Labourer's on Site (State) Award (No 1003 of 1989, 6 November 1989 Maidment J unreported)

HEARING

SYDNEY
25:6:1992

Counsel and solicitors
for the applicant: Mr S. Crawshaw instructed by

Taylor and Scott Solicitors

Counsel and solicitors

for the respondent: Mr M.R. Holmes instructed by

Kemp Strang and Chippindal

DECISION

INTRODUCTION
This is an appeal from a decision of the Chief Industrial Magistrate's Court concerning the interpretation of a provision of the National Building and Construction Industry Labourers (On Site) Award 1986 (the Award) dealing with travelling allowances.

2. The case before the Chief Industrial Magistrate, Mr G. Miller, was brought by way of complaint taken pursuant to section 178 of the Commonwealth Industrial Relations Act 1988 (the Act). A District, County, Local or magistrate's court can impose penalties upon a party in breach of an award or an order of the Australian Industrial Relations Commission: s 178(1), (9). Section 178(6) empowers such a court to order an employer to pay an amount to the employee to compensate for any underpayment. The complainant, Donald McDonald, the Secretary of the Building Workers' Industrial Union of Australia, New South Wales branch, sought the imposition of a penalty upon the respondent for an alleged breach of clause 15.11 of the award and an order in favour of Bruce Anderson for $21,599.29 as compensation for underpayment. Mr Anderson was an employee of the respondent at the relevant time.

3. The appeal is brought pursuant to section 56 of the Act. This section provides for an appeal as of right to the Federal Court in its Industrial Division and the jurisdiction of the Court may be exercised by a single judge: s 53(1).
THE AWARD

4. The dispute turns upon the interpretation of clause 15.11(j) of the award. However, it can only be understood in the context of other provisions of clause 15.11:

15.11 New South Wales
The following fares allowance and travelling allowance and
conditions shall apply to employees employed under the terms
and conditions of this Award in New South Wales for travel
patterns and costs peculiar to the industry which include
mobility requirements on employees and the nature of
employment on construction work.
(a) When employed on work located within the County of
Cumberland, Northumberland or Camden - $7.10 per day.
(b) When employed on a distant job as defined in Clause 24
hereof, the foregoing allowance shall be paid for work
performed within a radius of 50 kilometres from the
place where, with employer's approval, the employee is
accommodated for the distant job.
(c) An employer whose business or branch (other than a
construction site) is established in the cities of
Penrith, Newcastle or Campbelltown for the purpose of
engaging in construction work therefrom, shall pay
$7.10 per day to employees engaged on work located
within a radius of 50 kilometres from the principal
post office in such city.
(d) An employer whose business or branch or section
thereof is established in any place (other than on a
construction site) outside the areas mentioned in
15.11(a), (b) and (c) hereof for the purpose of
engaging in construction work therefrom, shall in
respect of employees engaged for work for that
establishment pay the allowance in 15.11(a) for work
located within a radius of 50 kilometres from the post
office nearest to that establishment.
Where the employer has an establishment in more than
one such place, the establishment nearest the
employee's residence shall be the establishment that
shall be taken into account.
...
(g) As required by the employer, employees shall start and
cease work on the job at the usual commencing and
finishing time within which ordinary hours may be
worked and shall transfer from site to site as
directed by the employer.
(h) An employee transferred from one site to another
during ordinary working hours shall be paid for the
time occupied in travelling and, unless transported by
the employer, shall be paid reasonable cost of fares
by convenient public transport between such sites.
Provided that where an employer requests an employee
to use his own car to effect such a transfer and such
employee agrees to do so the employee shall be paid an
allowance at the rate of 37 cents per kilometre.
(i) Where an employee travels daily to a job located
outside the counties of Cumberland, Northumberland or
Camden, or any of the 50 kilometre radial areas
mentioned in 15.11(b), (c) or (d) hereof, he shall be
paid:
(a) the allowance prescribed in 15.11(a), (b), (c) or (d)
(b) in respect of travel from the designated county
boundary or radius to the job and return to that
boundary or radius:
(i) The time outside ordinary working hours
reasonably spent in such travel calculated
at ordinary hourly "on site" rates to the
next quarter of an hour with a minimum
payment of one half an hour per day for
each return journey;
(ii) any expenses necessarily and reasonably
incurred in such travel, which shall be 20
cents per kilometre where the employee
uses his own vehicle.
Residing outside radial areas
An employee on such a job whose residence is outside the
radial areas or Counties prescribed herein shall be entitled
to the provisions of (a) above, but not (b) above.
(j) The provisions of 15.11(i) shall also apply to an
employee who is required by the employer to travel
daily from one of the areas mentioned in 15.11(a) and
(c) hereof to another area, mentioned in 15.11(a) and (b).

5. The Counties of Northumberland, Cumberland, or Camden (the counties) adjoin each other and have the east coast of New South Wales as a boundary. Newcastle stands within the northern boundary and Gosford lies within the southern boundary of the County of Northumberland. The County of Cumberland includes Sydney on its eastern boundary, Penrith near its western boundary and Campbelltown near its southern boundary. The County of Camden is further south of this and Nowra is close to its southern boundary. The counties, then, encompass a substantial area. Claude 15.11 creates what is basically a flat rate regime with sub-clauses (i) and (j) comprising the major relevant exceptions. If the work is within the counties, the employee is at least entitled to $7.10: sub-clause (a). (This amount has subsequently been increased.)

6. However, for Penrith, Newcastle and Campbelltown, the area for the application of the flat rate regime (the relevant area) are the areas contained within a 50 kilometre radius of the post office nearest to the respective business or branch: sub-clause (c). These cities share the characteristics of having substantial populations and being near the boundaries of their counties. Where the employee is accommodated on a distant job (i.e. a job where it is reasonably necessary for the employee to live away from home), the relevant area is within 50 kilometres of where the employee is accommodated, with the employer's approval: sub-clause (b). Where the business, or a branch or section of the business, of the employer (I shall refer to this as the employer's establishment) is outside any of these areas, the relevant area is 50 kilometres from the post office which is nearest that establishment; where there is more than one establishment, the relevant establishment is the one nearest the employee's residence.

7. Sub-clause (i) provides that where an employee travels daily to a job located outside the counties or any of the 50 kilometre radial areas, the employee shall be paid, in addition to the flat rate, an amount which varies according to the time spent in travelling and expenses incurred in travelling to and from the boundary of the relevant country or area.

8. The sub-clause contains a heading followed by a paragraph. As Chief Industrial Magistrate Miller said:

The words appearing between subclauses (i) and (j) of the
Federal Award by their form and context are misleading.
They are obviously intended to be part of paragraph (i) and
not to be read as prefatory words of paragraph (j).

9. This was not in dispute. Where an employee is employed on a job outside the counties or the 50 kilometre radial areas, and he resides outside those areas, he is entitled only to the flat rate regime.

10. The meaning of sub-clause (j) is in dispute. It states that the regime provided in sub-clause (i), that is, a flat rate plus a variable rate, applies where an employee is required by an employer to travel daily from one county or radial area to another county or radial area. The difficulty with this clause arises from the words, "required by the employer". These words are not found in sub-clause (i). The condition governing the application of that sub-clause is merely the fact that the employee travels daily to the job.

11. There is also provision for where the travel is not between work and home. Sub-clause (g) indicates that an employer may transfer an employee from site to site. According to sub-clause (h), if that occurs during ordinary working hours, the employee shall be paid for the time occupied in travelling as well as being paid reasonable costs for travelling by convenient public transport.
THE DECISION

12. The learned magistrate summarised the facts of the case as follows:

On May 1987, Mr Anderson applied at the respondent's office
at Rydalmere for a permanent position with it as a
scaffolder. The following day he commenced working with the
respondent on a permanent basis. He is still employed.
At the time of commencement with the respondent Mr Anderson
lived at Wyoming on the Central Coast. His place of
residence was shown on his application for work.
Approximately two years ago he moved to Narara, still on the
Central Coast. During his employment he has continuously
resided in the County of Northumberland.
The respondent works exclusively in the Sydney metropolitan
area, within the County of Cumberland. Each day the
respondent's area supervisor would tell Mr Anderson either
at work or by telephone where he has to work the next day.
The work performed by him was predominantly on the north
side of the Harbour.

13. Mr Anderson was paid the flat rate, but the appellant argues that under to sub-clause (j), he should have been paid in addition the variable rate stipulated in sub-clause (i).

14. The central paragraphs of the learned magistrate's decision on sub-clause (j) are on page 5:

Because there is a dispute between the parties as to the
interpretation of this clause this does not necessarily mean
the word "required" is ambiguous. In PKIU V Davies Bros
Ltd...Gray J at 449 highlighted the difficulty in
determining whether a word is ambiguous. However, at the
bottom of page 449, he stated "perhaps in a case such as
this the safest course is to assume that ambiguity does
exist, and to see where the application of extrinsic aids to
interpretation lead, in the construction of the document."
Adopting such an approach and resorting to the history of
clause 15 in question, it is evident that history shows that
the intention of the award-makers was to provide an
allowance to an employee who is required to work away from
his normal place of work in another county or radius. Its
intention, as disclosed by its history, was not in my view
to compensate an employee who choses (sic) to reside in one
county and choses (sic) to work in another for whatever
reasons. It certainly was not the intention to deprive an
employee from the Central Coast from work in the city which
would directly be the outcome.
Further in my opinion, the words "required by the employer"
appearing in the subclause must be given meaning. I cannot
agree with the opinion as expressed by Commissioner Bennett
(in Girvan Bros Pty Ltd and Civic Construction Pty Ltd) that
by employing a person who resides outside a county then by
the application of the normal incidents of the employment
contract that is sufficient to comply with the subclause.
The Commissioner stated "if an employer is aware that an
employee normally resides in an area outside the
county...then obviously he is requiring that employee to
travel across a county line". To me the contract of
employment is concerned with the respective rights and
duties after the employee reports for work.
In my view in interpreting the words "required by the
employer" in the context of this subclause it means an
actual request or demand for the employee to work outside
the county in which he is normally employed to work by his
employer.
In this matter I am of the opinion that Mr Anderson,
although required by his employer to work at different sites
within the County of Cumberland, does not come within the
provisions of subclause (j) as he was not required to work
on a site outside the County of Cumberland.

15. The appellant argued that this decision involved errors of law. Firstly, to have considered the history of the award at all was an error because there was no ambiguity in the language of sub-clause (j). The qualification read into the sub-clause relating to the normal place of employment did not arise on the plain language of the sub-clause. Even when the history is taken into account, there is no justification for this qualification. Moreover, the contract of employment is not confined to the respective rights and duties after the employee reports for work, as the contract of employment includes the provisions of the award relating to travel to and from work. In any event, the award provisions apply independently of the contract of employment.
INTERPRETING THE AWARD
Principles of interpretation

16. This award was by consent. The principles of interpretation of awards were explained by Justice French in City of Wanneroo v Holmes [1989] FCA 369; (1989) 30 IR 362 at 378-9. In Geo A. Bond and Co Ltd (In Liquidation) v McKenzie (1929) AR (NSW) 498 at 503-4 Street J, then a member of the Industrial Commission of New South Wales said:

Now speaking generally, awards are to be interpreted as any
other enactment is interpreted. They lay down the law
affecting employers and employees in their relation as such,
and they have to be obeyed to the same extent as any other
statutory enactment. But at the same time, it must be
remembered that awards are made for the various industries
in the light of the customs and working conditions of each
industry, and they frequently result...from an agreement
between parties, couched in terms intelligible to themselves
but often framed without that careful attention to form and
draughtsmanship which one expects to find in an Act of
Parliament. I think, therefore, in construing an award, one
must always be careful to avoid a too literal adherence to
the strict technical meaning of words, and must view the
matter broadly, and after giving consideration and weight to
every part of the award, endeavour to give it a meaning
consistent with the general intention of the parties to be
gathered from the whole award.

17. This passage was referred to by St John J in Simpson v Australian Telecommunications Commission [1978] FCA 41; (1978) 34 FLR 337 when concluding at 340 that "the reported decisions indicate that the approach is one which might be described as partially statutory and partially contractual".

18. Where no question of ambiguity arises, the Court simply applies the ordinary and natural meaning of the words in question. The Court is not restricted to the literal meaning of the words. As Smithers J said in Canberra Television Ltd v Australian Theatrical and Amusement Employees Association (1979) 24 ALR 529 at 535:

In a set of provisions dealing with such complicated matters (as
employment, rosters and shiftwork) it would not be surprising that
what appear to be anomalies might lurk, whatever interpretation is
adopted. Accordingly it appears to me that if an overall
objective of the award, rational and fair in content and without
significant anomalies, can be perceived that objective should be
given considerable weight in the construction of the individual
clauses of the award.

19. On the other hand, it is not part of the duty of the Court to give a meaning to an award, either with the object of prescribing that which it considers to be proper, or for the purpose of carrying out what it supposes to be the intention of the award-making authority, unless the words of the award can reasonably bear that meaning: Australian Workers' Union v Abbey (1939) 40 CAR 494. It must also be remembered that parties are free to apply to the Industrial Relations Commission for a variation of the award.

20. Where there is ambiguity, the Court can look beyond the words and at certain external factors to determine their meaning. Gray J noted in Printing and Kindred Industries Union v Davies Bros Ltd (1986) 18 IR 444 at 449 that there is no clear test laid down for determining when an ambiguity exists. Isaacs A.C.J. in Pickard v John Heine and Son Ltd [1924] HCA 38; (1924) 35 CLR 1 at 9 held that even though he personally did not see an ambiguity, since the interpretation he favoured was disputed at the Bar, there must be ambiguity.

21. On the other hand, in Kirkness v John Hudson and Co Ltd (1955) AC 696 Viscount Simonds stated that a Court could not conclude that there was an ambiguity if, having formed its own clear judgment, the Court concluded that the words in dispute were not open to diverse meanings. Gray J thought that the tests propounded by Isaacs A.C.J. and Viscount Simonds led to different results in the case with which he was dealing. His Honour said, as the Chief Industrial Magistrate noted in his decision here, that the safest course is to assume that an ambiguity does exist, and to see where the application of extrinsic aids to interpretation leads in the construction of the document.

22. Justice Wilcox referred in Bell v Gillen Motors Pty Ltd (1989) 27 IR 324 at 330-1 to the two tests discussed by Gray J. He said at 331, in a passage with which I respectfully associate myself:

The problem, as it seems to me, with the view taken by
Isaacs A.C.J. is that it assumes that counsel for each of the
parties has a genuine personal belief in the correctness of
the submission made by him or her. That will not
necessarily be so. As with any other submission, counsel is
entitled to contend for a particular interpretation of a
statute regardless of any personal belief as to its
correctness. Notwithstanding competing submissions there
may in fact be only one personal view at the bar table as to
the meaning of a particular statutory provision. In my
opinion the approach of Viscount Simonds is correct: the
judge must look at the contentious words and reach a
personal decision as to whether they are ambiguous. Only if
the judge finds an ambiguity is it legitimate for him or her
to go to extrinsic material.

23. In my view, courts should not be too reluctant to admit the possibility that there is an ambiguity in an award, or too artificial or legalistic in the search for its meaning. The Court should only refuse to consider extrinsic material which supports an interpretation, when the alternative interpretation being argued for is quite incapable of being supported by the words. The explanation of Street J in Geo A. Bond and Co Ltd should be kept in mind.

24. I begin then, with a consideration of the award looking purely at the wording of the sub-clause (j) in the context of other sub-clauses of clause 15.11.
The appellant's interpretation

25. The phrase "required by the employer" in the sub-clause quite clearly means that the employer is placing the employee under an obligation to travel from one area to another. The difficulty lies in determining the circumstances when the employee is in fact under that obligation. In many ways, virtually everything done by every employee in the course of employment can be described as the direct or indirect requirement of the employer.

26. The appellant referred to the decision of the Australian Conciliation and Arbitration Commission in Girvan Bros Pty Ltd and Civic Constructions Pty Ltd v The Building Workers' Industrial Union of Australia (20 October, 1988 - Print H5215) in which Commissioner Bennett considered the equivalent clause in the National Building Trades Construction Award 1975. The Commissioner stated:

The words "required by the employer" are probably
unnecessary in the terms of this award in that the employee
in any event is required by the employer to do many things.
The employer on engaging an employee requires that employee
to carry out the functions of the award, the employer
requires the employee to turn up for work at the appointed
time, the employer requires the employee to take his crib
break at a certain time.
In other words the award provides that an employer on
employing a person obviously requires him to do something
and I feel that the words mentioned in clause 15(11)(j) do
not go beyond this.
Now an employer in my view does not have the right to say
that employee A is required to work here by coming daily
across a county line on the one hand and to say that
employee B is not required. The act of engagement
automatically calls for a requirement.

27. The appellant also referred to a decision of the Industrial Commission of New South Wales in an Application by the Master Builders' Association of New South Wales for an Interpretation of the Building and Construction Industry Labourer's on Site (State) Award (6 November 1989, No 1003 of 1989). The wording of this award is different from the award under consideration here, in that the equivalent of sub-clause (j) did not apply to an employee when required to work at his regular place of employment at a carpentry and joinery shop or builder's yard: clause 10.2(b)(i). However, Maidment J said:

The clause when read as a whole seems to me to be in
contemplation of travel from the employee(')s place of
residence to the location of the work required of him by his
employer. It also contemplates circumstances where an
employee is required to travel from one work location to
another. It seems to me that if an employer, who knows that
an employee resides in an area...requires him to perform his
work at a location in another area...then, that employee
becomes entitled to the payments envisaged in (the
equivalent of sub-clause (j)). In such circumstances, in my
view, the employee is required by his employer to travel
within the meaning of the award.

28. It was suggested in argument here that where an employer is unaware of where the employee lives, for example, because the employee gives a false address, there is no liability under sub-clause (j). However, if Mr Anderson had been offered or given the job while he lived in Sydney, and he later moved to the central coast, the employer would then be liable to pay the extra travel allowance.

29. The fact is that the employer's requirements of him involved travel from the central coast even though it was Mr Anderson who made the choice to live there. In this situation, a specific requirement that the employer must have knowledge of where the employee lives does not advantage the employer in any appreciable way. I agree with Commissioner Bennett that the phrase "required by the employer" accomplishes little.

30. An employer's knowledge may be useful in some circumstances. For example, where an employer has several construction sites operating simultaneously, knowledge of where his employees reside could allow for a more efficient allocation of the employees, and a minimisation of travel allowances. The knowledge that one employee lives outside and another employee lives inside a county, might be useful in deciding which of two equally qualified employees to send to a job outside the county, since using the former would cost less in travel allowances than the latter. As this situation applies equally to sub-clause (i), it seems to me that if "requirement" simply means knowledge, the imposition of this condition in sub-clause (j) only is arbitrary and inexplicable.

31. This suggested interpretation requires attention to the compensation principle behind the uncontentious provisions of clause 15.11, to see whether they are helpful in determining the meaning of sub-clause (j).
The principle of compensation applied by the uncontentious provisions of the award

32. It was argued that sub-clauses (a), (c) and (d) define the relevant area to be considered in relation to the employer's establishment. When the establishment is outside a county, the relevant area is defined from the nearest post office to the employer's establishment. Where the employer's establishment is one of the three major cities which are near the boundaries of counties, the relevant area is the radial area around the GPO of that city.

33. So far as concerns the relevance of the location of an employee's residence, sub-clause (d) deals with the situation where there is more than one establishment. Here, the relevant establishment is the one closest to the employee's place of residence. Sub-clause (b) is the only provision to define the area from the place of accommodation of the employee, and not the employer's establishment. This deals with distant jobs. However, there is a significant qualification to this provision the employee must be located with the approval of the employer. This requirement is not present in any of the other sub-clauses.

34. The principle of pay or compensation, then, is that employees are entitled at least to the flat rate. The argument is that the entitlement to additional compensation is determined by whether the job is outside the relevant area, not whether the employee lives outside the relevant area.
Applying this argument on the principle of compensation to sub-clause (j)

35. Beginning with an uncontentious application of sub-clause (j), where the employer's establishment and employee's residence is in a county and the job is in another county, the sub-clause entitles the employee to the variable rate for his travel within that other county. In this context, sub-clause (j) effectively limits the relevant area to the county in which both employer and employee are located, as opposed to the area which comprises all three counties.

36. The difficulty arises when the employer's establishment and the employee's residence are in different counties. As I have said, one view is that the relevant area must be the county in which the employer's establishment is situated. This view would hold that any other conclusion is inconsistent with the compensation principle discerned from the other sub-clauses, and creates anomalies which would make the provisions as a whole illogical and arbitrary. There is no reason why an employee should be compensated for the fact that he lives outside the relevant county because he happens to live in another county rather than outside any county at all.

37. However, this interpretation does not avoid anomalies in the award. The very existence of a flat rate regime, combined with the definitions of the relevant areas, means that there can only be a crude application of the principle that employees should be compensated for above-normal amounts of travel. For example, an employee who lives outside a county is only entitled to the flat rate if assigned to work outside that county and the most direct route does not go through that county: see paragraph above sub-clause (j). However, an employee who lives outside the county may live only one kilometre away from another employee who lives just within the county, and this could lead to a substantial difference in entitlement to travelling allowances, a difference disproportionate to their respective times and expenses in getting to work.

38. While there is no particular problem in anomalies which are inherent in the regime agreed by the parties, and no doubt agreed for good reason such as ease of administration, it is a very different matter when an interpretation leads to an anomaly which is in fact inconsistent with the logic of the regime adopted. On one view the anomaly which results from this interpretation of sub-clauses (i) and (j) is in this category.

39. If sub-clause (j) contemplates the circumstance of an employee being sent to a different area from what might be described as the "normal area of work", it could be argued to be a perverse application of the clause to apply it in the converse situation of an employee living outside this normal area of work, and then travelling to a job which is inside that area. The question is whether it involves an impermissible stretch of interpretation to regard the words "required by the employer" as aimed at preventing this application. It would mean that working inside and outside the relevant area corresponds to voluntary and involuntary travel.
The rationale behind the principle of compensation

40. It could also be argued that the rationale behind the principle of compensation, discernible from the uncontentious sub-clauses, is that the employer's establishment should be regarded as the "normal area of work" for the purpose of determining compensation. This last qualification is important: it may well be that in a particular case, most of the employer's jobs are outside the area in which the employer is established. However, if the normal area of work is within a reasonable proximity of the employer's establishment, it could be said that employees know this before accepting the job and accept freely the additional cost of travelling to and from the normal area of employment if they choose to live outside it. Obviously these concepts would not apply where the empl2oyer assigns the employee to a job which is outside the normal area of work.

41. This is not a case of an employee choosing to live outside the normal area of work and accepting the cost of the additional travel. No employee can be expected to move house because a particular job happens to be away from the normal area of work. In reality, employees do not have perfect freedom to choose their normal area of work and residence, and may face substantial constraints with respect to both factors.

42. On the other hand, the respondent's argument is that the uncontentious sub-clauses are based on the assumption that the employee should only obtain additional compensation for travel when it is outside the normal area of work. According to this construction, additional costs from living away from the normal area of employment are voluntary costs adopted by the employee, while the costs of going to a job outside this area involve costs imposed by the employer. I doubt that the award admits of such a simple construction or conceptual basis.

43. A more complex situation arises where the relevant area is the County of Camden, the employee resides in the County of Cumberland, and the job is in the County of Northumberland. The appropriate allowance in such a case does not have to be decided here, but it is useful to consider it as a possible source of assistance in the interpretation of the award. Once again, I begin with the principles contained in the uncontentious clauses. If an employee lives outside the relevant county, and is assigned to a job which is also outside that county, the employee is only entitled to the flat rate: see the paragraph above sub-clause (j). This may not seem fair: as mentioned earlier, it leads to anomalies, although this type of anomaly is inherent in the award with its use of defined areas and a flat rate regime.

44. Applying the same principle here, the employee going to Northumberland from Cumberland would only be entitled to the flat rate. Of course, if the relevant area is Cumberland and the employee lives in Camden and the job is in Northumberland, the employee must pass through Cumberland and is entitled to the variable rate for the journey within Northumberland. "Required by the employer" means required to travel from the relevant area to another area.

45. This interpretation might explain why the language of requirement is not found in the sub-clauses other than (g). Where the work is outside the relevant area, there is an element of compulsion in being sent to work outside the normal area of work. There is therefore no need to use the language of requirement. However, in (j), there is a need to use this language to distinguish between being sent outside the area of the employer's establishment, as opposed to residing outside that area and being sent to a job within that area. The respondent says that this interpretation avoids the serious anomaly between sub-clauses (i) and (j) from which it says the alternative interpretation suffers.

46. The learned magistrate did not refer to a "normal area of work", but rather to a "normal place of work". The respondent also referred to a "normal place of work". The appellant argued that the concept of a normal place of work was inconsistent with sub-clause (g) which empowers the employer to direct employees from site to site. I agree that there is no normal place of work in the sense of work site. The award speaks of "areas", such as counties or "radial areas", and also refers to "sites" between which employees can be directed. The word "place" is not found in clause 15.11, and I do not think it is an appropriate term to use.
Whether the award is ambiguous

47. It cannot be said that either of the two suggested interpretations is incapable of being supported by the language of the award. Both interpretations have plausibility. The clause must therefore be regarded as ambiguous and subject to the consideration of extrinsic material. I do not think that the learned magistrate fell into error in so determining.
The history of the award

48. Where the provision of an award is ambiguous, the history and subject matter of the award may be considered: Isaacs A.C.J. in Pickard approved by Justice French in City of Wanneroo at 378. The first federal award in this industry was made by Kelly J who introduced a "radial system" with a graded scale of payments: Building Workers Industrial Union of Australia v A.L. Ackland Ltd (1946) 56 CAR 238 at 249. For example, in Victoria, radial areas were defined with reference to the GPO in Melbourne or the principal post offices at Ballarat, Bendigo or Geelong. The rate varied depending on whether the construction site was over 2, over 5 or over 12 miles, but less than 30 miles, from the relevant GPO. A different regime was provided for distant jobs, that is where the site is in a location which makes it reasonably necessary that the employee should live and sleep away from his usual place of residence.

49. In 1961 the radial system was changed to a flat rate: The Amalgamated Society of Carpenters and Joiners of Australia v Adelaide Joinery Works (1962) 101 CAR 433. (This case is referred to in The Amalgamated Society of Carpenters and Joiners of Australia v A.L. Ackland (1967) 118 CAR 197 at 199.) The union had submitted that tremendous building development had taken place in the outer metropolitan area in Melbourne and Adelaide, resulting in carpenters having to travel greater distances than formerly, and that fares on all forms of transport had risen (p. 455). The union relied upon statistics compiled by the Bureau of Census and Statistics and a survey it conducted to demonstrate the travel habits of the community in general, and claimed that this showed that the carpenter in following his occupation incurred more time and more cost than other sections of the community. Commissioner Webb said at 459-60:

Although the Commission cannot come to the point of
accepting the submission that the time incurred by a
carpenter or builder's labourer is not in excess of other
workers, it must say that there is considerable doubt as to
what is the factual position. The only factor which seems
clear is that both Unions and the employers are agreed on
the abandonment of the radial system currently operating in
favour of a flat rate. In this regard the Commission cannot
accept the rate of 7s. 6d. claimed by the Carpenters Union.
For many years the payment of this allowance has continued
on the assumption that the building worker, because his work
place is variable, must necessarily incur more time and more
in fares than a worker whose work place is not variable. In
this case this has not been positively proved or disproved.
However, the employers were not opposed to the continuance
of a payment provided that it was a flat rate representing a
weighted average (taken from the survey) of the three rates
currently payable.
In the circumstances, the Commission proposes to adopt a
rounded-off arithmetical average of the rates currently
prescribed for Victoria and South Australia.

50. Until 1975, employees in New South Wales were covered by a State award with a similar history. In Carpenters and Joiners and Bricklayers, Construction (State) Award (1960) AR (NSW) 694 Taylor J, the President of the Industrial Commission, said at 702:

The present award provides for payment of one rate on places
of work within a radius of up to and including twelve miles
from the GPO, Sydney, etc., a further rate for work done on
places of work over 12 and up to 20 miles distant and a
third rate for work performed on places of work over 20 and
up to 30 miles distant. All parties now seek the deletion
of the three rates and the insertion instead of one flat
rate of 6s per day. It will be noted that the rates payable
relate not to an employee's place of residence or to the
amount of excess fares and travelling time incurred by him,
but only to the situation of the place of work. With the
spread of building operations, this seems to me to have
become unreal and I think the alternative method proposed of
one flat rate for fares and travelling time is desirable.
(He then considered the allowance for distant work.)

51. In 1975, Justice Elizabeth Evatt in The Operative Painters and Decorators Union of Australia v Australian Federation of Construction Contractors (Nos 2763/74 and 2158/75, unreported but digested in 17 AILR (1975) para F 377) included New South Wales for the first time in a federal award. Her Honour said at 12 that the unions:

...proposed that for work within the Counties of Cumberland,
Northumberland or Camden the flat rate of $1.40 should
(apply). Where an employers (sic) headquarters were outside
those areas the flat rate would be paid for work within a 50
kilometre radius. Employees travelling to a job outside
those areas or that radius would receive extra payments for
time and expenses.

52. Justice Evatt upheld this claim, against the opposition of the employers who argued for a flat rate clause without extra payments for travel outside an area or a radius. An application for leave to appeal against this decision was refused: (1975) 168 CAR 89. The 1986 award at issue here followed.
The meaning of clause 15.11 in the context of the history of the award

53. Thus it seems that the determining factor for the travel allowance under the radial system was the distance of the place of work from the GPO of a major city. The question of which city is the relevant one appears to be determined by where the employer's business is, or to use the language in Justice Evatt's decision, the employer's headquarters. There was no reference to the place of residence of the employees.

54. The actual allowance was determined by radial bands around the city. Under the flat rate system, the underlying concept appears to have been similar: the flat rate averaged the different allowances, no doubt with consideration of the frequency with which employees were required to go to more distant and closer work sites. The averaging method produced an administratively simpler mechanism for determining allowances.

55. But there appears to be an assumption that employees do in fact live near the city. Thus the argument by the unions in Amalgamated Society of Carpenters and Joiners of Australia v Adelaide Joinery Works that the tremendous building development in the outer metropolitan area of Melbourne and Adelaide had resulted in carpenters having to travel greater distances than formerly.

56. With the present award, the regime has become more complex, but its essential aspects remain similar. There remains the definition of an area within which a flat rate regime applies, and the concept of distant work is still used. The added complexity comes from considering circumstances which lie between these extremes. There is the possibility of travelling outside the area, although not to a distant job: a regime which provides for variable rates is then applied. There is also the possibility of being employed in a different area: again the variable rates apply. It is possible that behind all this is that the employee is being sent away from the area of the employer's establishment to more distant work, either outside the county, or in a different county. But I do not think so.

57. It is true that the history of the award does not indicate that it was intended to encompass the possibility of an employee living outside the county or other area of the employer's establishment, and then picking up extra benefits travelling to it. But I doubt that the history shows the opposite. I do not agree that it demonstrates an entitlement to the extra pay where workers are sent away from and outside the area of the employer's establishment and not the converse situation of living outside this area, and going inside it for work. In my view the history adds little to what can be gleaned from interpreting the present award without regard to its precursors.

58. The respondent pointed to evidence that while the award was made in 1986, from 1975 to 1986 it was applied in the way that the employers are advancing. However, to my mind this evidence establishes, not that there was no payment of the award between 1975 and 1986 but rather that there were no disputes about the payment of the allowance during that time. This evidence is not in truth of much assistance.
SOME OTHER ISSUES

59. One of the grounds upon which the magistrate relied in disagreeing with Commissioner Bennett was that "the contract of employment is concerned with the respective rights and duties after the employee reports for work". But award provisions may be part of the contract of employment as a matter of implication: Gregory v Philip Morris Ltd [1988] FCA 100; (1988) 24 IR 397 at 422, and awards such as the present cover matters which occur before and after the employee reports to work. As I see the position, it is irrelevant in any event: this case concerns whether there have been breaches of the award, not of the contract of employment.

60. The Chief Industrial Magistrate said that it was certainly not the intention of the award-makers that an employee from the central coast would be deprived of work in the city, which, the learned magistrate claimed, would be the direct outcome of accepting the employee's interpretation. Firstly, there is nothing improper in considering the consequences of different interpretations of a provision against the intentions of the award-makers. Secondly, while I would not myself state so boldly the consequence that the appellant's interpretation would have upon the employment prospects of people living on the central coast, it would seem obvious that the provision of extra travel allowances to people in the central coast may well feature in a decision by an employer, whose work is in Sydney, to employ somebody with similar skills, reliability and integrity who lives in the County of Cumberland, assuming he has the choice. Depending on the distance and travel times involved, and the compensation payable, it might also affect the employee's decision to accept the job. It is not necessary to express an opinion on whether this factor is consistent or inconsistent with the intentions of the award-makers in this particular instance.
CONCLUSIONS

61. As it seems to me, there is no way to interpret this award without some difficulties and anomalies. On balance I believe that the intention of the relevant provision was to achieve the result enunciated by Justice Maidment and Commissioner Bennett. On its proper construction sub-clause (j) ought not to be encumbered with concepts such as the place of the employer's headquarters or normal area or place of work in terms of where the employer's administration is situated. The sub-clause says simply that the additional allowance is payable where the employee's obligation to turn up for work in accordance with the employer's instructions, require him to travel, inter alia, from one of the three counties to another of them. For this purpose, the relevant area is the county where he lives and which he must leave to enter the county where he is "required" to work.

62. I will therefore uphold the appeal. The respondent should pay the costs of the appellant. The parties should bring in appropriate orders to give effect to these conclusions, or organise a date with my Associate to argue what orders should be made in the light of my conclusions.