Australia: Do you have to pay an employee when their own conduct prevented them from performing their job?

Last Updated: 4 August 2018
Article by Richard Ottley

An employer might be forgiven for thinking that where an employee's conduct has rendered them unable to perform their role, then there is no obligation to pay them wages for the relevant period of downtime. However, this question is one which is now the subject of a Full Bench decision of the Fair Work Commission in BHP Coal Pty Ltd t/a BHP Billiton v Construction, Forestry, Maritime, Mining and Energy Union [2018] FWCFB 4148 (BHP Decision).

Whilst the final outcome in the BHP Decision aligns with what employers would consider a common-sense approach, the case was nevertheless an interesting one.

FACTS

Mr Goldspring an employee of BHP at Goonyella Riverside Mine in Queensland was employed in the Prestrip Department at the Mine. His duties primarily involved the on-site operation of vehicles and mobile equipment. Under BHP's standard operating procedures Mr Goldspring was required to hold a current Australian driver licence.

Mr Goldspring's driver licence was temporally suspended (again) due to driving whilst suspended for non-payment of fines. The relevant Manager at the Mine determined that Mr Goldspring was unable to perform his duties as he did not have a current driver licence and there was no work for him to perform. He could not return to work until his driver licence was reinstated. In the meantime, he could use all accrued annual leave and then go on unpaid leave. The total loss of pay as a consequence of Mr Goldspring's enforced absence from work totalled around $6,713.33.

Mr Goldspring or rather the CFMMEU on his behalf, challenged the non-payment of these wages. Following an unsuccessful dispute resolution process as required under the relevant Enterprise Agreement, the dispute was referred for arbitration to the Commission.

The two issues for determination were: -

  1. Did BHP have an obligation to provide Mr Goldspring with work other than work involving the operation of vehicles or mobile equipment (during the relevant period); and
  2. In all the circumstances should Mr Goldspring have been paid for the relevant period.

DECISIONS OF THE FAIR WORK COMMISSION

The matter originally came before Ashbury DP, who found in favour of the employee. BHP then appealed to the Full Bench comprising Hatcher VP, Colman DP and Lee C.

Two provisions under the applicable Enterprise Agreement were of particular relevance. They were clauses 4.1 and 4.4. Clause 4.1 stated that employees will perform such tasks as reasonably required by the company without any demarcation of duties while complying with all legal and statutory obligations... Clause 4.4 stated that employees were required to attend work in accordance with the roster and work as directed. An employee would only be entitled to be paid for time worked unless taking authorised leave.

The Full Bench considered that in interpreting an award provision regarding compliance with the "reasonable instructions of the employer or his representative" the judgment of Dixon J in R v Darling Island Stevedoring and Lighterage Company Limited [1938] HCA 44 was apposite, including the following passage.

"Accordingly, when the Award was framed, the expression "reasonable instructions" was adopted in describing the employee's duty to obey. What is reasonable is not to be determined, so to speak, "in vacuo". The nature of the employment, the established usages affecting it, the common practices which exist and the general provisions of the instrument, in this case an award, governing the relationship, supply considerations by which the determination of what is reasonable must be controlled".

The Commission adopted the same approach to clause 4.1 of the Enterprise Agreement. It noted that clause 4.1 required employees to perform the tasks required of them in compliance with "all legal and statutory obligations". It was implicit in such words, that employees must maintain themselves in a position to perform the required duties, lawfully.

The Full Bench found that Mr Goldspring could reasonably be required to perform his duties having regard to the nature of his employment and established usages and common practices. He was also required to hold a driving licence. In essence, Mr Goldspring was not excused from his obligations under clause 4.1 simply because his licence had been suspended, as the maintenance of his licence was a necessary incident to the performance of his duties and a contractual term.
In its words: -

"To reach a contrary conclusion would be to deprive the contract of employment and clause 4.1 of the Agreement, of their efficacy, since it would mean that once an employee puts themselves in a position where they are incapable of performing their contractual obligations, they cannot reasonably be required to discharge them. This would lead to the consequence for example, that an employee with the same duties as Mr Goldspring, if they attended for work in an intoxicated state, would effectively be excused from the contractual obligation to perform those duties because of incapacity."

The Full Bench found that while Mr Goldspring might have been willing to perform his job he was not ready and able to do so due to the suspension of his driver licence. Therefore, he had no contractual entitlement to payment of wages since actual service was required for wages to be earned.

Relevantly the Full Bench dismissed the submission by the CFMMEU that in complying with the direction from BHP not to attend work, Mr Goldspring was actually providing the required service. The Full Bench considered that the "direction" not to attend work was one made in recognition of the fact that Mr Goldspring was not able to provide the required service. Such a direction did not require authorisation under the contract of employment or the Enterprise Agreement, where Mr Goldspring was simply not in a position to carry out his contracted duties.

The Full Bench noted that in terms of the Enterprise Agreement, Mr Goldspring was not in a position to "work as directed" as per clause 4.4. Clause 4.4 also confirmed entitlement to payment only arose in respect of "time worked" unless taking authorised leave. Mr Goldspring was at no time performing work over the relevant period and therefore was not entitled to payment under the Enterprise Agreement.

The Full Bench noted that the position might be otherwise where an employee was ready, willing and able to perform work but was wrongfully not allocated work. However, that was not the situation here.

LESSONS FOR EMPLOYERS

Whilst each case will need to be looked at on its own merits, the Full Bench decision stands for the proposition, that generally speaking, those employees who cease to be in a position to provide the service they are contracted to provide, due to their own actions (or inactions), should not expect wages during the subsistence of the impediment to the provision of their services.

The fact that an employee in such a situation, is ready, willing and able to perform other duties does not guarantee an entitlement to wages, where the employer does not or is not able, to utilise such availability.

For further information please contact:

Richard Ottley, Partner
Phone: +61 2 9233 5544
Email: RBO@SWAAB.COM.AU

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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