Hough v Caboolture Shire Council & Stevens [1989] HREOCA 6 (22 December 1989)

HUMAN RIGHTS AND EQUAL OPPORTUNITY COMMISSION

SEX DISCRIMINATION ACT 1984

JAQUELINE NORA HOUGH COMPLAINANT

CABOOLTURE SHIRE COUNCIL FIRST RESPONDENT

BRIAN STEVENS SECOND RESPONDENT

22 DECEMBER 1989

REASONS FOR DECISION OF THE HON. JUSTICE EINFELD (PRESIDENT)

The Complaint

A complaint of sexual harassment by Jaqueline Nora Hough was lodged under sections 14 and 28 of the Sex Discrimination Act 1984 (the Act) on 13 June 1987. The first respondent is Caboolture Shire Council who was her employer and the second respondent Mr Brian Stevens, the first respondent's foreman. The first respondent was informed of the complaint on 15 July 1987 and the second respondent was informed on 16 July 1987.

On 11 August 1987 the first respondent claimed that it is an instrumentality of the State of Queensland and therefore immune from the operation of sections 14 and 28 of the Act. The argument is based on section 13 of the Act which provides:

(1) Section 14 does not apply in relation to employment by an instrumentality of a State.

(2) Section 28 does not apply in relation to an act done by an employee of a State or of an instrumentality of a State.

In section 4 of the Act, "Instrumentality of a State" is defined to mean:

a body or authority established for a public purpose by a law of a State and includes a technical and further education institution conducted by or on behalf of the government of a State, but does not include any other institution of tertiary education.

At the hearing of the argument on 29 May 1989, the complainant raised what amounts to a threshold point in reply. It was that the complaint could also be brought under section 26 of the Act and that even if the first respondent is not within the Commission's jurisdiction by virtue of section 13, a complaint under section 26 could still be heard by the Commission.

Although hopelessly out of the times fixed by direction, the Commission recently received written submissions from the parties on the applicability of section 26.

The Facts

Early in 1987 Ms Hough of 143 Mein Street, Scarborough Queensland was referred by the Redcliff Commonwealth Employment Service to the Caboolture Shire Council in connection with a position as a Labourer under the Community Employment Program (CEP). She commenced work as a labourer with the Council under the program on 2 February 1987 and was employed on a project which involved the installation of a stormwater drain in Sumner Street, Deception Bay. Her employment under the program was for six months expiring on 31 July 1987 but she was in fact dismissed on 27 May 1987 and paid until 29 May 1987. Her fundamental complaint is that her dismissal resulted from the fact that she was female and had rejected the sexual overtones of the second respondent, another employee of the first respondent who was Ms Hough's foreman.

Submissions on Section 13 of the Act

First Respondent's Submissions

It is common ground between the parties that if the first respondent is an instrumentality of the State for the purposes of the Act, the Commission is without jurisdiction.

In the first respondent's submission there are three elements all of which must be satisfied to bring an authority within the Act's definition of "Instrumentality of a State":

1. The party must be a body or authority.

2. It must be established by a law of the State.

3. It must be established for a public purpose.

1. Body or Authority

The submission is that, having regard to the terms of section 6(2) of the Local Government Act 1936 (Qld), there is no doubt that the Caboolture Shire Council is a body or authority. I think this submission is correct.

2. Established by a Law of the State

The first respondent submits that it is established by section 6(1)(ii) of the Local Government Act (Qld) which provides that every shire be governed by a Council. Thus, it is said, clearly the first respondent is established by an Act of the State of Queensland. I return to this matter later.

3. Public Purpose

Section 30 of the Queensland Local Government Act, provides that a local authority shall have delegated to it the functions of local government. Section 30 gives examples of the facilities included within the powers and authority of local authorities. Included in the list are roads, pedestrian malls, bridges, tunnels, ferries, public communication, public parks, gardens and playing grounds etc. The fifth paragraph of section 30 lists matters which are included within the functions of local government, and which are therefore included within the matters for which local authorities are established. The involvement of local government includes:

The undertaking, provision, construction, maintenance, management, execution, control, and/or regulation of the use of these various facilities.

In the first respondent's submission, if a local authority may exercise express powers and authority with respect to the undertaking and provision of such facilities, that includes the power itself to undertake or provide those facilities. The first respondent says, in this regard, that no matter what specific construction is placed on section 30, the functions entrusted to local authorities under the section cannot be anything other than public functions, or functions exercised for a public purpose. It says that it is clear that the term "public purposes" refers to purposes created by and required for the purpose of governing the community. It also says that the functions of local authorities are fundamentally for a public purpose, and that to hold otherwise would be to say that local authorities are established for some non-public or private purpose which it says would be absurd.

This would be the case wherever the term "instrumentality of a State" was used as it is in this legislation. If an instrumentality is excluded, it is not necessary to look at the specific nature or purpose of a transaction which gives rise to a dispute. The exclusion is simply the end of the matter. It would be different if the legislation focussed upon transactions or specific types of activity. In this case it only focuses upon the description of the purposes for which the authority is established.

Response to matters raised by Counsel for the Commission

The first respondent also addressed some matters relevant to section 13 which were raised in written submissions by counsel assisting the Commission. They include:

1. The dictionary meaning of "instrumentality" and the use of the term in another part of the Act in contradistinction to the expressions 'government authority' and 'local government body'.

The first respondent dismisses these matters as irrelevant, as the problem is not what the terms mean in isolation but what definition is applied to that term by the Act.

2. The Commission's decision in Janette Robyn Aston v Queensland Ambulance Transport Brigade, Brisbane Committee 26 November 1987.

The first respondent says that the reasons in that decision are helpful to its case, because a review of the legislation establishing the Ambulance Brigade showed that it was conducted for a public cause. The first respondent says the distinction between that case and this is that although Caboolture Shire Council is not a true instrumentality of the State in the traditional sense of shield of the Crown, it is nevertheless conducted for a public purpose and is accordingly an instrumentality of the State within the Act.

3. Section 15AA of the Acts Interpretation Act 1901.

The wider the application of the Act, the more its objects are promoted. The first respondent says that while section 15AA of the Acts Interpretation Act is an aid to construction, it may not be relied upon to exclude the plain text of the legislation. It is a provision which may be relied upon to determine which of a number of available constructions should be preferred where the primary provision is ambiguous: Queen v Bolton; Ex Parte Beane [1987] HCA 12; [1987] 70 ALR 225.

The first respondent says that if Parliament had intended that this legislation merely exclude a State instrumentality in the common law sense of a body shielding the Crown, there are many well established formulations of words which could have been used. Statutes regularly refer to bodies as representing the Crown or enjoying the powers, privileges and immunities of the

Crown. The legislature has not sought to take that course in this Act, but has used words which are plain of meaning and unambiguous in intent. They lead to the conclusion that Caboolture Shire Council is an instrumentality of the State.

Complainant's Submissions

Instrumentality of a State

The complainant submits that if the first respondent is right, the hitherto accepted concept of "instrumentality of a State" has been expanded. She referred to the Report of the Australian Bureau of Statistics on Employed Wage and Salary Earners in Australia for the December quarter, 1988. This shows that if the respondent is right, at least 27,000 local government employees are not protected by the Act in Queensland. The first respondent says that this example of the mischief rule must be subsidiary to the primary rule of taking the plain meaning of the words. Also the figures on unprotected employees are irrelevant because if true, it has come about because, of Queensland's failure to enact companion legislation to the Act.

The complainant says that if the first respondent is correct, not only has there been an expansion of the established notion of Crown immunity but it has been achieved without any legislative indication of such an intent and without any reference in the second reading speech of the Sex Discrimination Bill: see (Hansard, House of Representatives, 28 February 1989, pages 66-69).

As I see it, the problem with this argument is that "instrumentality of a State" in the present context is a statutory creation into which there is little room for the injection of concepts of Crown immunity as traditionally known.

Public Purpose

In reference to the first respondent's argument that it has been established for a public purpose, the complainant says that it is important to recognise the autonomous nature of local government. It is subject to certain intervention in certain circumstances by a State Government but it is nonetheless autonomous and established for its own purposes. The complainant submits that the public purpose referred to in the definition of instrumentality of a State must mean a public purpose of the State and not a public purpose of the local shire council.

Shire Councils are not agents, emanations or instrumentalities of the Crown in right of a State: Federated Municipal and ShireCouncil Employees Union of Australia v Melbourne Corporation [1918] 26 CLR 527 where Isaacs and Rich JJ said at 526:

The duties and functions of the corporation are, at least in the main, entirely local and for the benefit and advantage of the inhabitants of the locality or persons transiently coming there.

and at 538 per Higgins J:

But even if the Crown and its agents were immune from the Act, municipalities are not agents of the Crown so as to share in the immunity. The fact that

municipalities exist for public purposes does not make them immune. In England they have always been held liable to church rates, to sewers rates, to poor rates, to income tax, to land tax (see Rawlinson, Municipal Corporation Act 1883, 8th ed., p.220). The same principle is applied to municipal corporations as to the trustees of the Mersey Docks (Mersey Docks v Cameron [1865] EngR 610; 11 HLC 443), to the University of Edinburgh (Greigh v University of Edinburgh LR 1 HL (Sc). 348), to Trinity House (Gilbert v Trinity House 17 QBD 795). The distinction between governmental purposes and purposes of local government is emphatically shown in the case of the County Council of Middlesex v Assessment Committeeof St Georges Union [1896] 2 QB 143. In that case, the guild-hall of a county council was used for a double purpose - the administration of justice (quarter sessions), and municipal purposes; and it was held that the guild-hall was rateable so far as it was occupied for municipal purposes, not rateable so far as it was occupied for the administration of justice - a strictly governmental purpose, a function of the Crown. Therefore, so far as the English authorities are concerned, there seems to be no possible ground for the contention that municipalities are not subject to this Act.

The Local Government Act makes it clear in sections 4-4C that aside from certain limited circumstances, the Queensland Government cannot interfere in local government affairs and is essentially distinct and apart.

Thus it is proper to draw the conclusion that Shire Councils are independent and that the first respondent is in no way an emanation, instrumentality or agent of the Crown. Leaving aside the definition in the Act, it could not possibly attract the immunities of the Crown.

Other sections of the Queensland Local Government Act support this proposition. one of them is section 33 which provides that councils have no power to enforce overdue rates against "the Crown or instrumentalities of the Crown". The complainant argues

that if the first respondent was an instrumentality of the State for the purposes of the Act, the Local Government Act would speak of "or other instrumentalities of the Crown".

The complainant points to another pervasive proposition of law which is found throughout the authorities that if the legislature intends to grant Crown immunity to a statutory corporation then it does so by express grant. Nor is the first respondent proclaimed as a statutory body representing the Crown in right of the State of Queensland.

In Townsville Hospitals Board v Townsville City Council [1982] HCA 48; [1982] 149 CLR 282 at 291 Gibbs CJ said:

It has more than once been said in this Court that "there is evidence of a strong tendency to regard a statutory corporation formed to carry on public functions as distinct from the Crown unless parliament has by express provision given it the character of a servant of the Crown": Launceston Corporation v Hydro-Electric Commission [1959] HCA 12; [1959] 100 CLR 654 at 662; State Electricity Commission (Vic) v City of South Melbourne [1968] 118 CLR 50-4 at 510. All persons should prima facie be regarded as equal before the law, and no statutory body should be accorded special privileges and immunities unless it clearly appears that it was the intention of the legislature to confer them. It is not difficult for the legislature to provide in express terms that a corporation shall have the privileges and immunities of the Crown, and where it does not do so it should not readily be concluded that it had that intention.

In Crouch v Commissioner for Railways of Queensland [1985] HCA 69; [1985] 62 ALR 1 the High Court held that State railways were not only under the control and supervision of the State Government, but were for a State Government purpose. By analogy the complainant submits that the first respondent was not created for a public purpose.

It is not discharging State Government functions, it is discharging its own functions. The complainant contends that if the Act were to expand the notion of Crown protection, the definition of "instrumentality of a State" in the Act would read "a body or authority established for any public purpose". The complainant says that there are all sorts of bodies which do not have the protection of the Crown but which are established for a public purpose.

The complainant distinguished Aston on the basis that hospitals or ambulance boards are entirely funded by the State except for odd fund-raising activities, whereas the first respondent has external funding mechanisms which make it substantially independent of the Government. In addition, it may only be dismissed by the Government for misconduct.

My view is that "public purpose" should not be read down as suggested by the complainant. It means what it says, viz. for the purpose(s) of the public. It would be surprising that a local government authority, primarily responsible to the public which elects its governing body, conducted activities and provided services and facilities which were not for the purposes of at least "its" public, ie. the residents and ratepayers of its area. If the authority's activities are not for public purposes, they must presumably be for the private purposes of the Council. I do not believe that this is a possible conclusion.

Established by a Law of the State

During the hearing I raised with counsel the Act's words "a body or authority established by", not under or pursuant to, "a law of a State". I was told that Caboolture Shire Council was gazetted by the Governor in Council on 11 November 1879, and that section 6 of the Queensland Local Government Act provides that each shire shall be governed by a Council composed of a number of persons as the Governor in Council from time to time declares by order in Council.

The first respondent submits that Shire Councils are thus established by the Local Government Act in relation to the area identified under section 5(1). Section 6(2) provides that the local authority shall be a body corporate, without mention of its membership. The members are elected pursuant to the Act but do not take office by virtue of its terms.

The Local Government Act directs that, upon gazettal of an area, an election of the members be required by order in Council. It seems that a Council therefore has an existence outside its elected members, because it is the body corporate which counts and an administrator can be appointed as the body corporate. Thus the first respondent says that as soon as an area is gazetted, the body corporate exists.

The matter is not without doubt but my inclination is that Shire Councils are established by State law, treating "law" as meaning

not only legislation but legal and legally enforceable State Government activities such as orders in council, gazettals, regulations and the like.

The Section 26 argument

This section provides:

26 (1) It is unlawful for a person who performs any functions or exercises any power under a Commonwealth law or for the purposes of a Commonwealth program, or has any other responsibility for the administration of a Commonwealth law or conduct of a Commonwealth program, to discriminate against another person, on the ground of the other person's sex, marital status or pregnancy, in the performance of that function, the exercise of that power or the fulfilment of that responsibility.

(2) This section binds the Crown in right of a State.

Complainant's Submissions on Section 26

The Community Employment Act 1983 provides for the creation of additional employment throughout Australia. Sections 4 and 5 of that Act provide:

Approval of Projects

4 (1) The Minister, or an officer of the Department who is authorised by the Minister by instrument in writing, may approve projects for the creation of employment.

(2) In approving projects for the purposes of sub-section (1), particular regard shall be had to the creation of employment for the long term unemployed and for unemployed persons who are specially disadvantaged.

The States

5 (1) The Minister may, on behalf of the Commonwealth, enter into an agreement with a State for the carrying out of approved projects in the State.

(2) Without in any way limiting the matters that may be provided for in an agreement with a State, such an agreement shall include provision for and in relation to

(a) the manner of carrying out the approved projects to which the agreement relates;

(b) payments to be made to the State under this Act; and

(c) the conditions subject to which those payments shall be made.

The Community Employment Program (CEP) was created pursuant to the Community Employment Act under the auspices of the Commonwealth Department of Employment and Industrial Relations (the Department). Section 9 of that Act provides financial assistance from the Commonwealth to the relevant State and section 11 makes payments by the Commonwealth pursuant to the scheme dependant on the State showing that the monies so allocated are expended on such projects as may be approved under the scheme. It also obliges the payee of moneys under the scheme to provide the Minister with reports in respect of the project. If the payee fails to report, or the Minister is satisfied that the approved project has not been undertaken, the monies advanced by the Commonwealth must be repaid.

In "Guidelines for Project Sponsors" published by the Department in October 1986, there is stated:

The Community Employment Program (CEP) is a major initiative of the Commonwealth Government to create employment opportunities. CEP operates under the Community Employment Act (1983).It involves the Commonwealth Government and State/Territory Governments in constructive partnership with Local Government Authorities and Community Groups. This booklet contains guidelines which are for use by Local Government Authorities and Community Groups who wish to participate as project sponsors under the Program.

As a local government authority and instrumentality thus made eligible for CEP grants, the first respondent applied, for the purpose of constructing stormwater drainage between Sumner Street and the Esplanade, Deception Bay, within the Shire of Caboolture. The application was approved in a letter of 28 November 1986 from the joint secretariat of the Program. The approval was conditional upon the first respondent employing a number of long term unemployed adults, including three women, and a number of other conditions.

The complainant submitted that the first respondent thus became responsible for the administration and conduct of a Commonwealth program within section 26 of the Act and that this was the basis of her employment.

The objects of the Act are specified in section 3. They include:

(b) to eliminate, so far as possible, discrimination against persons on the ground of sex, marital status or pregnancy in the areas of work ................and the administration of Commonwealth laws and

programs

(c) to eliminate, so far as possible, discrimination involving sexual harassment in the workplace and in educational institutions.

Sexual harassment is one form of discrimination which the Act outlaws. The sexual harassment the complainant alleges she has

suffered at the hands of the second respondent would, if proven, constitute discrimination by the first respondent on the ground of sex. The first respondent is vicariously liable for the actions of the second respondent by reason of section 106 of the Act.

The complainant's allegations are of both direct (s.5(1)) and indirect (s.5(2)) discrimination. The indirect discrimination arises out of the allegation that she was "not muscular enough to lift heavy weights and push wheelbarrows". The complainant argues that these requirements of her were unreasonable in the circumstances, as she was and could be employed in a number of tasks associated with the project which did not involve heavy lifting.

First Respondent's Submissions on Section 26

1. The section deals only with direct discrimination and has no relevance to allegations of sexual harassment.

2. On any view of the evidence, there was nothing done by the first respondent or any person in the first respondent's employment which can in any way be related to a specific provision of any Commonwealth legislation. The question is whether or not the alleged discrimination has been carried out by any person performing a function or exercising a power for the purposes of a Commonwealth program or having any other responsibility for the conduct of a Commonwealth program.

3. It is true that the immunities provided in sections 12 and 13 have no relation to any issue under section 26 and that section 26 binds the first respondent. It is also correct that if an act of discrimination falling within the prohibition of section 26 has been committed by an employee of the first respondent, then the Act applies in relation to the first respondent as if it had itself committed the act, by virtue of section l06 of the Act.

4. But section 26 of the Act does not operate to bring it within the Commission's jurisdiction because the first respondent and its employees were not performing any function or exercising any power for the purposes of a Commonwealth program, or had any other responsibility for the conduct of a Commonwealth program when it dismissed the complainant.

5. It is conceded that the complainant was employed on a project partly funded by a Commonwealth grant under the Community Employment Act 1983. In relation to that Act the first respondent submits section 5(1), (2)(a)(b)(c), and (9) and section 11 are relevant. These provisions show that administration of the provisions of the Community Employment Act was a matter between the Commonwealth and the State. It is also conceded that this does not end the matter because a party may form a function or exercise a power for the purposes of a Commonwealth program notwithstanding that the party is not specifically identified in the legislation under which the program is established. Accordingly it is necessary to determine the content of the program set up under the Community Employment Act.

6. The Community Employment Act provides no real assistance in this regard other than to set the broad parameters of the purpose of allocations. The scope and intent of the program are contained in the guidelines. The program does not extend to the carrying out of projects but only to the financing of certain projects on particular terms.

7. The crux of the submission is thus based on a distinction between participation in the program and administration of the program. The first respondent says it is only to the second aspect (administration) that section 26 applies. To do something "for the purpose" or "for the administration" of a program, the doer must be an agent of the party responsible for the implementation of the program and not merely a recipient of its benefits or burdens, which are unilaterally imposed. It is submitted that the words are unambiguous and do not go so far as to mean participation in a Commonwealth program or expenditure of funds received under a Commonwealth program.

8. The program exists to fund projects but the carrying out of the projects is not part of the program. The guidelines (section 3.4) indicate that a sponsor must be capable of carrying out the project without assistance (except in

relation to finance) and without direction, control or guidance from the secretariat. Section 5.5 of the guidelines provides:

Where it is intended to publicly promote CEP projects, sponsors should ensure that appropriate acknowledgment is made of the Program as a source of funding. The Program should be promoted as a Commonwealth Government initiative jointly administered by the Commonwealth and State or Territory governments.

9. Accordingly the program only involves allocation of funds subject to certain conditions and accounting of funds. It is only the Commonwealth and State governments working through the secretariat which do acts in relation to the program which are capable of falling within section 26 of the Act.

10. In making its decision (through an authorised employee) to dismiss the complainant, the respondent was complying with the requirement that it assume overall responsibility for the administration and operation of the project, but was doing nothing related to the administration of the program.

I am unable to accept these submissions. There can be no doubt that sexual harassment is a form of sex discrimination: see Aldridge v Booth [1988] FCA 170; [1988] 80 ALR 1; and the authorities collected in Bennett and Anor v Everitt and Anor [1988] EOC 92-244 at page 77,279. There is no reason to read down section 26 to exclude cases of sexual harassment. Indeed, it would make somewhat of a nonsense of the Act to read section 26 in that way.

The CEP is undoubtedly a Commonwealth program within the meaning of section 26. There is equally no doubt that the first respondent was performing functions and exercising powers for the purposes of the CEP or had other responsibilities for its conduct. The question for present purposes is whether a complaint of dismissal on relevant discriminatory grounds could be an act of discrimination "in the performance of" the functions, or "in the exercise of" the powers or "in the fulfilment" of the responsibilities. In my view, the section does contemplate such conclusions. Clearly the functions, powers and responsibilities under CEP projects include the employment of labour. Indeed that was the object of the CEP. The requirement that the labour employed in this instance specifically include some women is a reflection of the need to provide equal or at least some affirmative opportunity for females in CEP projects. The employment of staff includes the way in which they are treated at work and the terms and conditions of their employment. Unless their employers are exempted from the Act, all employees are entitled by law to a workplace free of sexual harassment and sex discrimination. Regardless of section 13, 14 and 28, the beneficiaries of Commonwealth programs are entitled to this protection by section 26. A person working under such a program dismissed by reason of sex discrimination, including one entitled to the protection provided by virtue of the provisions on sexual harassment, is denied the benefits and protection of the Act.

The application for summary dismissal is refused.