Nz Tramways and Public Passenger Transport Employees Union v Wellington City Transport Ltd

• Jurisdiction: New Zealand
• Judge: A D Ford
• Judgment Date: 06 July 2011
• Court: Employment Court
• Docket Number: WRC 35/10
• Date: 06 July 2011

In The Matter Of An Application For Special Leave To Remove Authority proceedings

BETWEEN

NZ Tramways and Public Passenger Transport Employees Union

First Applicant

And

Christopher Rupapera

Second Applicant

And

Faaiuaso Pakau

Third Applicant

and

Wellington City Transport Limited

Respondent

[2011] NZEmpC78

WRC 35/10

IN THE EMPLOYMENT COURT WELLINGTON

Application pursuant to s178(3) Employment Relations Act 2000 for special leave to remove an employment relationship problem from the Employment Relations Authority to the Employment Court on the grounds that important questions of law (s178(2)(a)) were likely to arise in the matter other than incidentally and that the case was of such a nature and of such urgenc(s178(2)(b)) that it was in the public interest that it be removed immediately to the Court — issue surrounded interpretation of a collective employment agreement (“CEA”) — whether the case involved a “routine matter of contractual interpretation” of particular clauses in the CEA and as they were a well settled area of law, not appropriateto require transfer to the Employment Court under s178.

Appearances:

Ms Tanya Kennedy, counsel for the applicants

Mr Bernard Banks, counsel for the respondent

JUDGMENT OF JUDGE A D Ford

The application

1 The applicants have made application, pursuant to s 178(3) of the Employment Relations Act 2000 (the Act), for special leave to remove an employment relationship problem from the Employment Relations Authority (the Authority) to this Court. The first applicant is the New Zealand Tramways and Public Passenger Transport Employees Union (the union) and the second and third applicants are two affected members of the union. The stated grounds for the application are that important questions of law (s 178(2)(a) of the Act) are likely to arise in the matter other than incidentally and that the case is of such a nature and of such urgency (s 178(2)(b)) that it is in the public interest that it be removed immediately to the Court. The respondent, Wellington City Transport Limited, previously traded as “Stagecoach Wellington” and presently trades as “Go Wellington”. It opposes the removal.

2 Application for the matter to be removed to the Court was initially made to the Authority but, in a determination 1 dated 28 October 2010, the Authority declined the application for removal concluding on the facts that nothing had emerged from its investigation to suggest that an important question of law was likely to arise otherthan incidentally and that it had not been shown there was any identifiable public interest and urgency.

3 When the Authority declines to remove any matter to the Court, the party applying for removal may, pursuant to s 178(3), seek special leave of the Court for removal and in that event the Court must apply the same criteria as that which applied to the Authority apart from that criterion contained in s 178(2)(d).

The background facts

4 Prior to 1 July 1991, bus drivers in Wellington were employed directly by Wellington City Council under terms and conditions of employment agreed between the council and the union. Their employment was also covered by the Wellington City Council Employee Regulations which prescribed certain resignation and retirement gratuities. In 1991 local authorities ceased to have the power to conduct passenger transport services but they were able to continue to be involved in the industry through a local authority trading enterprise.

5 In July 1991, Wellington City Council established the respondent company, Wellington City Transport Limited, as a local authority trading enterprise. All resignation and retirement gratuities contained in the earlier regulations were

retained. The statement of problem filed on behalf of the applicants records subsequent developments:

All subsequent agreements with Wellington City Transport Limited (both under Wellington City Council and private ownership as Stagecoach & Infratil) through to the current agreement, contained the same wording as the current clauses 79 and80. These clauses reflect the entitlements that existed as at 30 June 1991 under the WCC Employee Regulations and were frozen at that point.

6 The relevant “current agreement” referred to in [5] is the Go Wellington Collective Employment Agreement 2008 – 2010 (the CEA). Under cl 79 of the CEA there is provision for a discretionary retirement gratuity. The clause reads:

79 Retiring Gratuities for Employees Employed Prior to 1 July 1991

On retirement of any employee who had continuous service with Wellington City Council up to 30 June 1991, the Company may pay to that employee by way of a gratuity, an amount calculated in accordance with the following scale:

Three weeks? pay increasing by one week for each additional year's service after 10 years until a maximum of twenty six weeks? pay is reached after thirty three years? service.

7 Clause 80 provides for a discretionary resigning gratuity:

80 Employees Employed Prior to 1 July 1991 Resigning for Private Reasons

Employees employed by the Company as at 1 July 1991, who resign for private reasons may, at the discretion of the Company, be granted resigning leave on full pay as follows:

After ten years' continuous service	-	3 weeks
After fourteen years' continuous service	-	4 weeks
After seventeen years' continuous service	-	5 weeks
After twenty years'continuous service	-	6 weeks

8 Up until their retirement in 2010, the second and third applicants were bus drivers employed by the respondent and its predecessor. During their employment they were both members of the union employed under the relevant agreement or CEA. The second applicant, Mr Rupapera, was employed as a bus driver for 20 years from 7 May 1990 until 8 May 2010 when he retired. The third applicant, Mr Pakau, was employed as a bus driver for 20 years and seven months between 18 September 1989 and 8 May 2010 when he retired. Mr Rupapera and Mr Pakau contend that they should have been paid 19 weeks? pay and 20 weeks? pay respectively under cls 79 and 80 of the CEA. Instead, each received a payment described by the respondent as a “gratuity payment” of three weeks? pay.

9 The respondent's position, as set out in its statement in reply, is that upon the resignation of the second and third applicants, it considered whether to pay a gratuity pursuant to cl 79 of the CEA or resigning leave pursuant to cl 80 of the CEA but in each case it decided not to make any such payment. Instead it made what it referred to as “an additional ‘gratuity payment’ of $3,715.20” to each applicant being equal to three weeks? pay. The respondent stated that the payment “was a purely discretionary payment beyond anything required by the Collective Agreement.”

The legal principles

10 The legal principles relevant to applications for special leave to remove are well established. They were summarised by this Court in McAlister v Air New Zealand Ltd: 2

• 1. An applicant for special leave under s 178 of the Employment Relations Act 2000 carries the burden of persuading the Court that an important question of law is likely to arise in the matter other than incidentally, or the case is of such a nature and of such an urgency that the public interest calls for its immediate removal to the Court.

• 2. It is necessary to identify a question of law arising in the case other than incidentally.

• 3. It is necessary to decide the importance of the question.

• 4. It is not necessary that the question should be difficult or novel.

• 5. The importance of a question of law can be gauged by factors such as whether its resolution can affect large numbers of employers or employees or both. Or the consequences of the answer to the question are of major significance to employment law generally. But importance is a relative matter and has to be measured in relation to the case in which it arises. It will be important if it is decisive of the case or some important aspect of it or strongly influential in bringing aboutadecision of the case or a material part of it.

• Even if an important question is likely to arise, the removal of a matter to the Court is discretionary. Factors which have been considered relevant to the exercise of that discretion have been whether any useful purpose would be served byordering the removal to the Court; whether

  the case is one which turns on a number of disputed facts which can be more properly dealt with in the Authority; whether the case is of such urgency that it should be dealt with properly in the Employment Relations Authority;and whether this is a case which will inevitably come to the Court by way of a challenge in any event.

11 In Virtual Warehouse Ltd v Hormann, 3 Judge Couch noted, in relation to whether an important question of law is likely to arise, that the Court must be able to “properly conclude” that such an important issue will in fact likely arise in the proceeding.

Important question of law

12 Section 178(2)(a) of the Act provides that a matter may be removed to the Court, if “an important question of law is likely to arise in the matter other than incidentally”. In relation to this...