and Australian Workers' Union, the (AWU) v Monadelphous Engineering Pty Ltd

[2020] FWC 5701

[2020] FWC 5701

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.437 - Application for a protected action ballot order

"Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU);
and
Australian Workers' Union, The (AWU)
v
Monadelphous Engineering Pty Ltd
(B2020/525; B2020/527)

COMMISSIONER SPENCER BRISBANE, 26 OCTOBER 2020

Proposed protected action ballot of employees of Monadelphous Engineering Pty Ltd.

[1] Applications pursuant to s.437 of the Fair Work Act 2009 (the Act) were made by the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) and the Australian Workers’ Union (AWU), (collectively, the Applicants/the Unions). The Applicants sought for both matters to be heard together. There was no objection to this course by the Respondent. The Respondent for both applications is Monadelphous Engineering Pty Ltd (the Respondent/the Employer). The matters related to applications for protected action ballot order for industrial action by employees of the same employer, and in accordance with s.442 of the Act, both matters were heard together, by agreement.

[2] Directions were set in line with the requirements in s.441 of the Act for the Respondent to confirm whether they objected to the application and if so, on what grounds. The Respondent objected, to the Commission making the Protected Action Ballot Order in the terms sought.

[3] The Respondent initially objected to the applications on the basis that the Applicants had not provided sufficient material in support of their applications for the Commission to be satisfied they had and have been genuinely trying to reach agreement. The Respondent then later objected on the basis that the Applicants were each pursuing claims about a non-permitted matter, in terms of a pursuit for a specific income protection provider, (from which each Union would gain an advantage).

[4] The Respondent stated that the Applicants’ logs of claims, in each case, included a claim specifying a particular provider of services in relation to income protection insurance. The Respondent said the Applicants have a financial interest in the income protection provider and would derive significant financial benefit from the provision of the services.

[5] The following directions were set out in response to the Respondent’s objections, primarily in relation the income protection provision:

“DIRECTIONS AND HEARING

[6] The employer is directed to provide a further submission in relation to their objection on the grounds of the income protection provision, taking into account the following provisions of the Fair Work Act:

179 Disclosure by organisations that are bargaining representatives

(1) When a organisation must disclose: If

(a) an organisation is a bargaining representative for a proposed enterprise agreement that is not a greenfields agreement; and

(b) the organisation is not an employer that will be covered by the agreement; and

(c) as a direct or indirect consequence of the operation of one or more terms of the agreement (the beneficial terms), the organisation or a person mentioned in subsection (2) will, or can reasonably be expected to, receive or obtain (directly or indirectly) a section 179 disclosable benefit (each such person is a beneficiary); (emphasis added)

the organisation must take all reasonable steps to ensure that, in the time required by subsection (3), each employer that will be covered by the agreement is given a document in accordance with subsection (4).

Note: This subsection is a civil remedy provision (see Part 4-1).

(2) For the purposes of paragraph (1)(c), the persons are any of the following:

(a) a related party of the organisation (other than a related party prescribed by the regulations);

(b) a person or body prescribed by the regulations for the purposes of this paragraph.

(3) The document must be given to the employers no later than the end of the fourth day of the access period referred to in subsection 180(4) for the agreement.

(4) The document must:

(a) itemise the beneficial terms; and

(b) describe the nature and (as far as reasonably practicable) amount of each section 179 disclosable benefit in relation to each beneficiary; and

(c) name each beneficiary; and

(d) be in accordance with any other requirements prescribed by the regulations for the purposes of this paragraph; and

(e) be given in a manner (if any) prescribed by the regulations.

(5) An organisation that gives a document under subsection (1) must not knowingly or recklessly make a false or misleading representation in the document.

Note: This subsection is a civil remedy provision (see Part 4-1).

(6) A section 179 disclosable benefit is any financial benefit, other than a financial benefit that is:

(a) payable to an individual as an employee covered by the agreement; or

(b) payment of a membership fee for membership of an organisation; or

(c) prescribed by the regulations for the purposes of this paragraph.

[7] The employer is further directed to address the submissions of the unions in relation to permitted matters and in which they provide in their response to the objection in which they indicate they declared their interest with regard to the proposed income protection provision.

[8] This further submission is required to refine the issues between the parties and to assess whether a hearing is required in the matter.

[9] Subject to the response, the parties are also at liberty to make comment in relation to the course to be adopted in this matter. That is, whether the objection is maintained (and if so whether a hearing is required) given the above provisions in the Act.”

[10] In response to these directions, the AWU advised that it withdrew its claim for income protection in its entirety. The AMWU maintained its claim for income protection. The matter was listed for Hearing. No party sought to cross examine the other parties’ witnesses.

LEGISLATIVE PROVISIONS

[11] The application was made under s.437 of the Act, as follows:

“437 Application for a protected action ballot order

Who may apply for a protected action ballot order

(1) A bargaining representative of an employee who will be covered by a proposed enterprise agreement, or 2 or more such bargaining representatives (acting jointly), may apply to the FWC for an order (a protected action ballot order) requiring a protected action ballot to be conducted to determine whether employees wish to engage in particular protected industrial action for the agreement.

(2) Subsection (1) does not apply if the proposed enterprise agreement is:

(a) a greenfields agreement; or

(b) a multi-enterprise agreement.

(2A) Subsection (1) does not apply unless there has been a notification time in relation to the proposed enterprise agreement.

Note: For notification time, see subsection 173(2). Protected industrial action cannot be taken until after bargaining has commenced (including where the scope of the proposed enterprise agreement is the only matter in dispute).

Matters to be specified in application

(3) The application must specify:

(a) the group or groups of employees who are to be balloted; and

(b) the question or questions to be put to the employees who are to be balloted, including the nature of the proposed industrial action.

(4) If the applicant wishes a person other than the Australian Electoral Commission to be the protected action ballot agent for the protected action ballot, the application must specify the name of the person.

Note: The protected action ballot agent will be the Australian Electoral Commission unless the FWC specifies another person in the protected action ballot order as the protected action ballot agent (see subsection 443(4)).

(5) A group of employees specified under paragraph (3)(a) is taken to include only employees who:

(a) will be covered by the proposed enterprise agreement; and

(b) either:

(i) are represented by a bargaining representative who is an applicant for the protected action ballot order; or

(ii) are bargaining representatives for themselves but are members of an employee organisation that is an applicant for the protected action ballot order.

Documents to accompany application

(6) The application must be accompanied by any documents and other information prescribed by the regulations.”

[12] Section 443 of the Act sets out when the Commission must make a protected action ballot order:

“443 When the FWC must make a protected action ballot order

(1) The FWC must make a protected action ballot order in relation to a proposed enterprise agreement if:

(a) an application has been made under section 437; and

(c) the FWC is satisfied that each applicant has been, and is, genuinely trying to reach an agreement with the employer of the employees who are to be balloted.

(emphasis added)

(2) The FWC must not make a protected action ballot order in relation to a proposed enterprise agreement except in the circumstances referred to in subsection (1).

(3) A protected action ballot order must specify the following:

(a) the name of each applicant for the order;

(b) the group or groups of employees who are to be balloted;

(c) the date by which voting in the protected action ballot closes;

(d) the question or questions to be put to the employees who are to be balloted, including the nature of the proposed industrial action.

(3A) For the purposes of paragraph (3)(c), the FWC must specify a date that will enable the protected action ballot to be conducted as expeditiously as practicable.

(4) If the FWC decides that a person other than the Australian Electoral Commission is to be the protected action ballot agent for the protected action ballot, the protected action ballot order must also specify:

(a) the person that the FWC decides, under subsection 444(1), is to be the protected action ballot agent; and

(b) the person (if any) that the FWC decides, under subsection 444(3), is to be the independent advisor for the ballot.

(5) If the FWC is satisfied, in relation to the proposed industrial action that is the subject of the protected action ballot, that there are exceptional circumstances justifying the period of written notice referred to in paragraph 414(2)(a) being longer than 3 working days, the protected action ballot order may specify a longer period of up to 7 working days.

Note: Under subsection 414(1), before a person engages in employee claim action for a proposed enterprise agreement, a bargaining representative of an employee who will be covered by the agreement must give written notice of the action to the employer of the employee.”

(emphasis added)

[13] Section 414 of the Act provides:

“414 Notice requirements for industrial action

Notice requirements—employee claim action

(1) Before a person engages in employee claim action for a proposed enterprise agreement, a bargaining representative of an employee who will be covered by the agreement must give written notice of the action to the employer of the employee.

(2) The period of notice must be at least:

(a) 3 working days; or

(b) if a protected action ballot order for the employee claim action specifies a longer period of notice for the purposes of this paragraph—that period of notice.

Notice of employee claim action not to be given until ballot results declared

(3) A notice under subsection (1) must not be given until after the results of the protected action ballot for the employee claim action have been declared.

Notice requirements—employee response action

(4) Before a person engages in employee response action for a proposed enterprise agreement, a bargaining representative of an employee who will be covered by the agreement must give written notice of the action to the employer of the employee.

Notice requirements—employer response action

(5) Before an employer engages in employer response action for a proposed enterprise agreement, the employer must:

(a) give written notice of the action to each bargaining representative of an employee who will be covered by the agreement; and

(b) take all reasonable steps to notify the employees who will be covered by the agreement of the action.

(6) A notice given under this section must specify the nature of the action and the day on which it will start.”

[14] Also relevant to this application is s. 179 of the Act which reads:

“179 Disclosure by organisations that are bargaining representatives

(1) When a organisation must disclose: If

(a) an organisation is a bargaining representative for a proposed enterprise agreement that is not a greenfields agreement; and

(b) the organisation is not an employer that will be covered by the agreement; and

(c) as a direct or indirect consequence of the operation of one or more terms of the agreement (the beneficial terms), the organisation or a person mentioned in subsection (2) will, or can reasonably be expected to, receive or obtain (directly or indirectly) a section 179 disclosable benefit (each such person is a beneficiary);

the organisation must take all reasonable steps to ensure that, in the time required by subsection (3), each employer that will be covered by the agreement is given a document in accordance with subsection (4).

Note: This subsection is a civil remedy provision (see Part 4-1).

(2) For the purposes of paragraph (1)(c), the persons are any of the following:

(a) a related party of the organisation (other than a related party prescribed by the regulations);

(b) a person or body prescribed by the regulations for the purposes of this paragraph.

(3) The document must be given to the employers no later than the end of the fourth day of the access period referred to in subsection 180(4) for the agreement.

(4) The document must:

(5) An organisation that gives a document under subsection (1) must not knowingly or recklessly make a false or misleading representation in the document.

Note: This subsection is a civil remedy provision (see Part 4-1).

(6) A section 179 disclosable benefit is any financial benefit, other than a financial benefit that is:

(a) payable to an individual as an employee covered by the agreement; or

(b) payment of a membership fee for membership of an organisation; or

(c) prescribed by the regulations for the purposes of this paragraph.”

[15] Section 172 of the Act relevantly provides:

“Making an enterprise agreement

Enterprise agreements may be made about permitted matters

(1)  An agreement (an enterprise agreement ) that is about one or more of the following matters (the permitted matters ) may be made in accordance with this Part:

(a)  matters pertaining to the relationship between an employer that will be covered by the agreement and that employer's employees who will be covered by the agreement;

(b)  matters pertaining to the relationship between the employer or employers, and the employee organisation or employee organisations, that will be covered by the agreement;

(c)  deductions from wages for any purpose authorised by an employee who will be covered by the agreement;

(d)  how the agreement will operate.

Note 1:       For when an enterprise agreement covers an employer, employee or employee organisation, see section 53.

Note 2:       An employee organisation that was a bargaining representative for a proposed enterprise agreement that is not a greenfields agreement will be covered by the agreement if the organisation notifies the FWC under section 183 that it wants to be covered.

Single-enterprise agreements

(2)  An employer, or 2 or more employers that are single interest employers, may make an enterprise agreement (a single-enterprise agreement ):

(a)  with the employees who are employed at the time the agreement is made and who will be covered by the agreement; or

(b)  with one or more relevant employee organisations if:

(i)  the agreement relates to a genuine new enterprise that the employer or employers are establishing or propose to establish; and

(ii)  the employer or employers have not employed any of the persons who will be necessary for the normal conduct of that enterprise and will be covered by the agreement.

Note:          The expression genuine new enterprise includes a genuine new business, activity, project or undertaking (see the definition of enterprise in section 12).

Multi-enterprise agreements

(3)  Two or more employers that are not all single interest employers may make an enterprise agreement (a multi-enterprise agreement ):

(a)  with the employees who are employed at the time the agreement is made and who will be covered by the agreement; or

(b)  with one or more relevant employee organisations if:

(i)  the agreement relates to a genuine new enterprise that the employers are establishing or propose to establish; and

(ii)  the employers have not employed any of the persons who will be necessary for the normal conduct of that enterprise and will be covered by the agreement.

Note:          The expression genuine new enterprise includes a genuine new business, activity, project or undertaking (see the definition of enterprise in section 12).

Greenfields agreements

(4)  A single-enterprise agreement made as referred to in paragraph (2)(b), or a multi-enterprise agreement made as referred to in paragraph (3)(b), is a greenfields agreement .

Single interest employers

(5)  Two or more employers are single interest employers if:

(a)  the employers are engaged in a joint venture or common enterprise; or

(b)  the employers are related bodies corporate; or

(c)  the employers are specified in a single interest employer authorisation that is in operation in relation to the proposed enterprise agreement concerned.

Requirement that there be at least 2 employees

(6)  An enterprise agreement cannot be made with a single employee.”

DRAFT ORDER

[16] The draft orders, as sought by the Unions, was made in identical terms (other than the name of the relevant Unions), and read as follows:

“Pursuant to s.443 of the Fair Work Act 2009 (the Act) the Fair Work Commission orders:

1. PROTECTED ACTION BALLOT TO BE HELD

The Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union, known as the Australian Manufacturing Workers’ Union (AMWU) is to hold a protected action ballot of employees of Monadelphous Engineering Pty Ltd.

2. NAME OF PERSON AUTHORISED TO CONDUCT THE BALLOT

The ballot is to be conducted by the Australian Electoral Commission.

3. GROUP OR GROUPS OF EMPLOYEES TO BE BALLOTED

The employees to be balloted are those employees of Monadelphous Engineering Pty Ltd who are members of the Automotive, Foods, Metals, Engineering, Printing and kindred Industries Union known as the Australian Manufacturing Workers’ Union (‘AMWU’) who are covered by the Monadelphous Engineering Pty Ltd Central Queensland Operations Enterprise Agreement 2018 – 2020 and would be covered by the proposed agreement.

4. DATE VOTING CLOSES

20 business days following the date on which this order is issued by the Commission.

5. QUESTIONS

Do you support the following industrial action being approved?

Question 1:

An unlimited number of stoppages of work, including consecutive stoppages of work, of one (1) hour in duration?

YES / NO

Question 2:

An unlimited number of stoppages of work, including consecutive stoppages of work, of two (2) hours in duration?

YES / NO

Question 3:

An unlimited number of stoppages of work, including consecutive stoppages of work, of four (4) hours in duration?

YES / NO

Question 4:

An unlimited number of stoppages of work, including consecutive stoppages of work, of six (6) hours in duration?

YES / NO

Question 5:

An unlimited number of stoppages of work, including consecutive stoppages of work, of twelve (12) hours in duration?

YES / NO

Question 6:

An unlimited number of stoppages of work, including consecutive stoppages of work, of twenty-four (24) hours in duration?

YES / NO

Question 7:

An indefinite or periodic ban on the performance of overtime?

YES / NO

Question 8:

An indefinite or periodic ban on the performance of pre-shift overtime?

YES / NO

Question 9:

An indefinite or periodic ban on performing call outs?

YES / NO”

RESPONDENT’S OBJECTION

[17] The Respondent submitted that the objection to the granting of the applications is not about whether or not its employees should enjoy the benefits of income protection, but rather that the conduct of the Applicants during the bargaining process of bargaining for the nomination of particular providers of income protection insurance, of which the Applicants have a significant financial interest in.

[18] The Respondent submitted that because the Applicants are seeking a particular supplier or suppliers to provide income protection insurance, and not income protection generally, that the Applicants are seeking a non-permitted matter and thereby not genuinely seeking to reach agreement, such that the applications should not be granted.

[19] The Respondent submitted that the Commission should dismiss the applications as the
Applicants have failed to demonstrate that they are and have been genuinely trying to reach an agreement, in accordance with s.443(1) of the Act.

Genuine attempts to reach agreement

[20] The Respondent submitted that s.443(1) of the Act provides that the Commission must be satisfied that each Applicant to a protected action ballot application has been and is genuinely trying to reach an agreement with the relevant employer of employees, who are to be balloted. The Respondent submitted that an Applicant for an Order should put sufficient probative evidence before the Commission for the Commission to be so satisfied. The relevant Form to be provided under the Commission’s Rules for the required declaration clearly provides for an Applicant to include details in the declaration.

[21] The Respondent cited a Full Bench of the Fair Work Commission in Esso Australia Pty Ltd v AMWU, CEPU and AWU, 1 submitting this decision provided a detailed consideration of the existing authorities regarding the application of s443(1)(b) of the Act amongst other things. The Respondent said the Full Bench held that a finding of fact that an applicant for a protected action ballot order has been, or is, pursuing a claim about non-permitted matters is relevant to determining whether that applicant is genuinely trying to reach an agreement, but it is not, by itself, determinative, quoting from paragraph [59] of that decision:

‘There is no legislative warrant for the adoption of a decision rule that an applicant is, or has been, pursuing a substantive claim which is not about a permitted matter it is not genuinely trying to reach an agreement within the meaning of s443(1)(b). The fact that an applicant is, or has been, pursuing a claim about a non-permitted matter is relevant to whether the test posited by s443(1)(b) has been met, but is not determinative of the issue. A range of factual considerations may potentially be relevant in that context, including but not limited to the subject matter of the claim, the timing of the advancement of the claim, the basis upon which the claim is advanced, the significance of the claim in the course of the negotiations, the claimant’s belief as to whether the claim is about a non-permitted matter or not, where there is legal clarity about the permitted status of the claim, whether the other party has placed in contest whether the claim is about a permitted matter, and whether such a claim has been withdrawn and, if so, when and in what circumstances. The diversity of factual circumstances and nuances which will be found in different cases means that it is not possible to say that any particular factor or consideration will be determinative of the result.”

[22] The Respondent further referred to the Explanatory Memorandum to the Fair Work Bill 2008, which it submitted provides guidance as to the operation of s.172 of the Act. The Respondent specifically referred to 672 and 673 which read (Respondent’s emphasis):

“672. It is intended that the following terms would be within the scope of permitted matters for the purpose of paragraph 172(1)(a):

•  terms relating to particular staffing levels (subject to any other applicable legislative requirements or limitations) particularly if those terms are aimed at ensuring the health, safety and well-being of employees;

•  terms relating to conditions or requirements about employing casual employees or engaging labour hire or contractors if those terms sufficiently relate to employees' job security - e.g. a term which provided that contractors must not be engaged on terms and conditions that would undercut the enterprise agreement;

•  terms that would provide that casual employees are converted to permanent employees after a set period of time;

•  terms that would prevent an employer from seeking a contribution or indemnity from an employee in respect of personal injuries or losses suffered by that person where such injuries or losses were cause by the employee in the course of their employment.

673. The following terms would not be intended to be within the scope of permitted matters for the purpose of paragraph 172(1)(a):

•  terms that would contain a general prohibition on the employer engaging labour hire employees or contractors;

•  terms that would contain a general prohibition on the employer employing casual employees;

•  terms that would require an employer or employee covered by to the enterprise agreement to make a donation to a political party or charity;

•  terms that would require an employer to source only products from a particular supplier or Australian made products (unless, e.g., such a term was directly related to employees' job security); (emphasis added)

•  terms that would require an employer to engage or not engage particular clients, customers or suppliers who had agreed to commit to certain employment, environmental or ethical standards (unless, e.g., such a terms was directly related to employees' health and safety);

•  terms that relate to corporate social responsibility, e.g., terms requiring an employer to participate in charity events or commit to climate change initiatives.

Non-permitted matters

[23] The Respondent submitted that because the Applicants are seeking particular supplier to provide income protection insurance, and not income protection generally, that they are seeking a non-permitted matter and thereby not genuinely seeking to reach agreement such that the applications should not be granted.

[24] The Respondent identified that the particular supplier of income protection is WageGuard for the AWMU and Chifley Financial Services for the AWU. The Respondent submitted that should the Applicants pursue these applications with these providers, they should be required to provide copies of all documents relating to the WageGuard and Chifley Financial Services and any persons or entities associated with WageGuard and Chifley Financial Services, including full details of the financial benefits obtained by the Applicants and any of their employees or officers, including any commissions or fees, including any directors fees or remuneration.

[25] The Respondent submitted that the Applicants receive significant financial benefits from the inclusion in the Agreement of these particular suppliers in the Enterprise Agreements. Ms Chantal Tobin, Operations Manager for the Respondent, provided a witness statement (she was not required for cross examination), stating that as part of the bargaining process, she reviewed documentation regarding both income protection providers nominated by the Applicants.

[26] Ms Tobin stated that she reviewed the WageGuard Product Disclosure Statement and identified that the AMWU had a 49% ownership of U-Cover Pty Ltd, the company that provided the WageGuard product. She said that U-Cover Pty Ltd acted as trustee for the U-Cover Trust, which is a joint venture between the AMWU and another business named CoverForce. Ms Tobin gave evidence that the AMWU’s share of net surplus as a result of this ownership was $2,480,108 for the year ended June 2019.

[27] Ms Tobin stated that she also reviewed the Financial Services Guide for Chifley Services Pty Ltd and identified it is a trustee for the Chifley Trading Trust (ACN 630 582 857) and is a corporate authorised representative for Coverforce Pty Limited and Coverforce Partners Pty Ltd. Ms Tobin said the Current & Historical Company Extract, as prepared by the Australian Securities & Investment Commission (ASIC), indicates that the AWU holds a 30 per cent share in Chifley Services Pty Ltd, and that the Australian Workers Union (National Office) Annual Financial Report for the year ended June 2019 (the AWU Financial Report) indicates that the AWU has a $375,000 investment in Chifley Financial Services and a $165,000 investment in Chifley Services Pty Ltd as trustee for the Chifley Trading Trust.

[28] Ms Tobin said that the AWU Financial Report indicated that the AWU received income of $30,020, dividends of $165,000 and commission fees of $16,435 were received from Chifley Financial Services and that Chifley Financial Services were invoiced $55,000 (ex GST) as a supporter of the AWU’s 2019 National Conference.

[29] The Respondent submitted that throughout the course of negotiations the Applicants had pressed for the inclusion of the provision with the particular suppliers from the outset and failed to provide any disclosure as to their interests or relationship with either supplier. The Respondent argued that the Applicants had unrelentingly maintained their claims for these particular suppliers, including up to the point of making the applications and had placed significant importance on the inclusion of these particular suppliers such that the identity of the supplier and not the entitlements provided by the suppliers is the key focus of bargaining regarding income protection.

[30] The Respondent argued that the Applicants had not provided any alternatives to their nominated suppliers and submitted that the Applicants would only support a term in the negotiated enterprise agreement that places their nominated supplier as the provider of the benefit. The Respondent said that income protection benefits had been provided for in the existing enterprise agreement and multiple predecessors. Ms Tobin stated that the Applicant’s had not been genuinely trying to reach agreement because of their pursuit of the income protection providers, that the Respondent considered to be a non-permitted matter.

APPLICANTS’ SUBMISSIONS AND EVIDENCE

[31] Both the AMWU and AWU made submissions in relation to the application which were on similar terms and are summarised below.

[32] Ultimately, prior to the Hearing, the AWU in response to the submissions, withdrew its pursuit for the income protection, but did not concede they were pursuing a non-permitted matter. In correspondence, in response to the Directions on the income protection providers, both Applicants stated that they had been transparent about the interest in the providers and would declare such consistent with the Statutory Agreement approval requirements.

AMWU’s submissions

[33] The AMWU rejected that they had sought a particular income protection provider, and submitted that throughout the bargaining process, the Applicants had been genuinely trying to reach agreement with the Respondent regarding an appropriate level of income protection benefits for the Respondent’s employees. The AMWU submitted that the intent of the bargaining representatives has been to negotiate an improved scope of income protection insurance cover, which is distinct from the Respondent’s assertion that the Applicant is pursuing a claim that would compel the Company to use specific providers of services in relation to income protection insurance.

[34] The AMWU submitted that Ms Tobin stated that the Applicant’s claims were solely aimed at securing a specific provider of services in relation to income protection insurance, yet the Respondent provided no direct evidence to support this contention other than to rely on the wording within the AMWU log of claims.

[35] The AMWU submitted that there is a historical context to the AMWU naming WageGuard in the Log of Claims during bargaining and said that WageGuard was named in the Log of Claims for the previous Agreement with the Respondent. The AMWU submitted that the outcome of previous negotiations did not result in the Respondent being compelled to use specific providers of services in relation to income protection insurance, and it is misleading to suggest the claim is about a non-permitted matter, or that the purpose of the Applicant’s conduct is to overpower the Respondent to impose a defined provider upon it.

[36] The AMWU relied on the evidence of Mr Phil Golby, an Organiser for the AMWU. Mr Golby referred in his statement to the minutes of a bargaining meeting dated 24 February 2020.
Mr Golby said that during the meeting he was asked by Mr Tyler Clews, Senior IR Advisor for the Respondent, about the income protection clause and provided the following in response:

“During that discussion, Mr Clews said: “You didn’t specify Wage Guard in the clause?” and I responded:

‘No I didn’t, as we want to make sure that we get the best IP insurance for our Employees. It can be written in there if you wish, but I have left it blank for the time being. That is for discussion and negotiation.’” 2

[37] The AMWU submitted that the minutes of that meeting clearly show that Mr Golby responded directly to a question about the Applicant’s income protection claim and he stated the bargaining reps were focussed on securing “the best IP insurance for … employees” as distinct from pursuing a specific provider to be named in the proposed agreement. The AMWU submitted that the minutes of the bargaining on 24 August 2020, show the Respondent had acknowledged the employees were dissatisfied, with the existing income protection insurance cover and the Respondent was proposing to make changes to the policy.

[38] The AMWU submitted that it considered this activity supported the contention that the parties were meaningfully engaged in a process whereby employee claims were being advanced, and the employer was seeking to accommodate those claims in relation to the standard of income protection offered.

Income protection as a permitted matter

[39] The AMWU submitted that the claim relating to income protection benefits advanced by the Applicant’s bargaining representatives, when appropriately characterised as above, is a ‘permitted matter’ in accordance with s.172(1)(a) of the Act. The AMWU argued that income protection benefits and the payment of premiums by the employer on an employee’s behalf is a matter that pertains to the employment relationship between the employer and employees.

[40] The AMWU referred to the Decision of Australian Maritime Officers Union v Sydney Ferries Corporation 3:

“A term directed to the protection of income in the event of illness or injury may pertain to the relationship of employers and employees in the same way as those other forms of employment benefit and may do so where the protection endures after the obligation to make the payment which secures it has ended. Whether or not the term pertains to the relationship of employers and employees depends upon all the circumstances.”

[41] In contrast, the Respondent has relied on the Explanatory Memorandum to the Fair Work Bill 2008 to substantiate their submission that the Applicant has been pursuing a non-permitted matter, namely terms within the proposed Agreement that would require the Respondent to source only products from a particular supplier. The AMWU denied that there was the requirement of the provision being pursued.

[42] The AMWU submitted that the list of exclusions in the legislative provisions itself should be treated with caution. The AMWU said its position is that the Explanatory Memorandum and the exclusions listed therein are irrelevant because the Applicant’s bargaining representatives have never sought ‘a particular supplier/s to provide income protection insurance’. Instead, the AMWU argued its bargaining representatives have advanced claims for a particular standardof income protection insurance, and this is a distinct concept and claim that the Respondent appears to have confused.

Genuinely trying to reach agreement

[43] The AMWU submitted that, if the Commission is not satisfied that Applicant’s claim for income protection is a permitted matter, then the pursuit of this claim is not determinative that the Applicant has not been genuinely trying to reach an agreement with the Respondent.

[44] The AMWU referred to Esso Australia Pty Ltd v AMWU, CEPU and AWU [2015] FWCFB 210 (Esso) at [59]:

“‘There is no legislative warrant for the adoption of a decision rule that an applicant is, or has been, pursuing a substantive claim which is not about a permitted matter it is not genuinely trying to reach an agreement within the meaning of s443(1)(b). The fact that an applicant is, or has been, pursuing a claim about a non-permitted matter is relevant to whether the test posited by s443(1)(b) has been met, but is not determinative of the issue. A range of factual considerations may potentially be relevant in that context, including but not limited to the subject matter of the claim, the timing of the advancement of the claim, the basis upon which the claim is advanced, the significance of the claim in the course of the negotiations, the claimant’s belief as to whether the claim is about a non-permitted matter or not, where there is legal clarity about the permitted status of the claim, whether the other party has placed in contest whether the claim is about a permitted matter, and whether such a claim has been withdrawn and, if so, when and in what circumstances. The diversity of factual circumstances and nuances which will be found in different cases means that it is not possible to say that any particular factor or consideration will be determinative of the result.’ (Our emphasis)”

[45] The AMWU submitted that when each of the relevant factual considerations referred to in Esso are applied to the facts of the current matter, the Respondent’s claims that the Applicant has not and is not genuinely trying to reach an agreement, steadily erode to the point where opposition to the applications has no effective basis. The AMWU made submissions on each of the considerations as outlined below:

Subject matter of the claim

[46] The AMWU submitted that the subject matter of the claim is that employees are seeking improved income protection insurance, and that the allegation that this outcome is being pursued through a request, that the employer provide insurance equivalent to an existing product is unremarkable. The AMWU said that Income protection insurance has become a common feature of Australian collective agreements, and naming a service provider is an accepted convention because particular service providers offer different standards of service. The Applicant submitted it is reasonable that employee representatives who are not trained lawyers should reference a product, as being representative of the scope of insurance cover they seek to secure.

Timing

[47] The AMWU submitted the timing of the advancement of the claim is uncontroversial and that the income protection claim, has been pursued consistently, since the first log of claims was tabled. The AMWU said a draft clause was currently with the Respondent awaiting consideration at the next bargaining meeting. By contrast, the AMWU argued the Respondent has not led any evidence to show the Applicant has taken constructive steps to have WageGuard named in the proposed Agreement

The basis on which the claim is advanced

[48] The AMWU said its bargaining representatives based the claim for improved income protection benefits, under the proposed Agreement, on employee feedback, regarding the unsatisfactory income protection coverage, provided under the current Agreement. The AMWU rejected the Respondent’s allegation that the Applicants had actively pursued a false claim for enhanced income protection insurance, while a real claim for a specific provider has been kept in abeyance, waiting for the time when the false claim can be dropped and the alleged claim can be secured. The AMWU argued that there is no evidence to support this proposition because it has not and is not happening.

The significance of the claim in the course of negotiations

[49] The AMWU rejected the proposition that income protection is thesignificant outstanding matter, in the negotiations, citing Mr Golby’s evidence that at the time of the last bargaining meeting on 25 August, there were a number of outstanding claims. The AMWU accepted the income protection claim is an important claim for the employees, but it does not hold the level of significance the Respondent is seeking to attribute to it.

The claimant’s belief as to whether the claim is about a non-permitted matter

[50] The AMWU submitted that the evidence of Mr Golby is that he does not agree that any aspect of the claim is about a non-permitted matter, including the naming of WageGuard within the log of claims as an insurance provider that supplies a product to the market that employees believe is superior to the existing income protection product.

[51] The AMWU submitted that in arguing the claim for income protection is a non-permitted matter, the Respondent referenced the Explanatory Memorandum to the Fair Work Bill 2008 and has extrapolated a part of the Memorandum that is unlikely to be directly related to the claim for income protection being pursued by the Applicant. The AMWU stated that whilst Mr Golby is an experienced negotiator, he is not a lawyer, and that given the absence of any existing authorities, that address the specific issue, alleged by the Respondent, it is unsurprising that Mr Golby fervently believes the claim is a permitted matter.

Whether the other party has placed in contest whether the claim is about a permitted matter

[52] The AMWU submitted that the Respondent has provided evidence that Ms Tobin believes the claim is a non-permitted matter, but no evidence has been provided to show the Respondent ever contested the issue on those grounds during the course of bargaining. In contrast, the AMWU said Mr Golby’s evidence is that the claims relating to income protection were not contested as non-permitted matters.

[53] The AMWU submitted this is a crucial factor in the Commission’s consideration of the veracity of the Respondent’s claim, arguing that the evidence of Ms Tobin shows she strongly believed the Applicant was not genuinely bargaining and yet, despite many opportunities to address the issue, it was never contested by the Respondent. The AMWU submitted that it believes the Respondent has for some time erroneously held the view that the Applicant’s claim for income protection insurance, was a non-permitted matter, but continued to negotiate whilst simultaneously maintaining a view that it could withdraw from any possible commitments on the basis that the claim was about a non-permitted matter. The AMWU submitted that this was duplicitous and struck at the very heart of the negotiating process and highlights the challenges currently confronting the collective bargaining process.

Matters not requiring consideration at this time

[54] The AMWU submitted that a great deal of attention had been given to the connections between the AMWU and WageGuard. The AMWU submitted that this information is of limited relevance to the consideration of the applications, submitting that when the Respondent first provided limited particulars of their grounds for objecting to the applications, the focus appeared to be on the absence of a Corrupting Benefits Declaration. The AMWU said that when this basis was shown to be erroneous, the Respondent shifted the objection to it being about a claim for non-permitted content.

[55] The AMWU submitted that no weight should be afforded to the Respondent’s inferences that the nexus between the AMWU and WageGuard should be regarded as evidence, or that the AMWU has or is pursuing a claim for non-permitted content. The AMWU said that it would comply with the requirements of s.179 of the Fair Work Act 2009 if that is necessary at any future time, but as there is currently no requirement for the AMWU to make the type of declaration previously demanded by the Respondent, the arguments made by the Respondent regarding these issues should be disregarded.

AWU’s submissions

[56] The AWU provided submissions on 15 September 2020 and then further submissions in reply to the Respondent’s material on 30 September 2020. The AWU submitted that it supported and agreed with the AMWU’s submissions.

Income protection

[57] The AWU acknowledged it did put a claim for their own income protection provider being Chiefly, and the AWU requested that the same to be included into the proposed enterprise bargaining agreement and it was rejected by the Respondent. The AWU stated that it had transparently disclosed its interest and followed all of its obligations under the Act.

Non-permitted/permitted matters and genuinely trying to reach an agreement

[58] The AWU referred to Alcoa and the Full Bench’s consideration of whether non-permitted and/or permitted matters affected s.443(1)(b). The AWU, in support of its position, quoted the Full Bench in Alcoa of Australia Ltd v Australian Workers Union (WA) 4 as follows:

“[18] ...the mere fact that a proposed agreement contains non-permitted matters is not fatal to a conclusion that the bargaining representative who propounded it is genuinely trying to reach agreement…” 5

[59] The AWU further quoted paragraphs [23] and [24]:

“[23] It is readily apparent that s 443 (1), on its face, does not contain any requirement relating to permitted matters. As may be discerned from our analysis of the Australia Post case, the issue of permitted matters is but one of the factors to be taken into account in determining whether an applicant has been genuinely trying to reach an agreement.

[24] It is not only satisfaction that a proposed agreement does not contain claims about, or reasonably be believed to be about, permitted matters that informs a judgement as to whether an application has been genuinely trying to reach an agreement.” 6

[60] The AWU submitted that while it is confident, it is pursuing permitted matters, it should not be the only and sole consideration of the Commission, in determining the dispute between the parties under section 443 (1) (b) of the Act.

Genuinely trying to reach an agreement

[61] The AWU submitted that throughout the bargaining process with the Respondent, the AWU has been genuinely attempting to reach an agreement and thus satisfying section 443 (1) (b) of the Act.

[62] The AWU submitted that at all times, it had cooperated and worked with the Respondent in reaching an enterprise bargaining agreement that would be acceptable to both parties and as such had satisfied section 443 (1) (b) of the Act. The AWU sought that the Respondent’s objection be dismissed and the protected action ballot order be allowed.

CONSIDERATION

Are the income protection claims permitted matters?

[63] In accordance with s.172 of the Act, Enterprise Agreements may be made about permitted matters. The various types of permitted matters are set out in s.172(1).

[64] The Respondent submitted that because the Applicants are seeking particular suppliers to provide income protection insurance, and not income protection generally, that they are seeking a non-permitted matter and thereby not genuinely seeking to reach agreement such that the applications should not be granted.

[65] The AWU submitted that the income protection insurance relates to the employee and employer relationship, in accordance with s.172(1)(a) of the Act, on the basis that income protection is providing insurance to an individual’s wages in such circumstances as to if they are unable to work, such as injury. The AWU submitted that the request was that there be an array of options available and not only one single choice.

[66] The AWU submitted that income protection should be a permitted matter covered by section 172(1)(a) of the Act, and on the basis that the request from the AWU was for an array, not just one choice available to the employees of the Respondent.

[67] The AMWU submitted that, if the Commission is not satisfied that Applicant’s claim for income protection is a permitted matter, then the pursuit of this claim is not determinative that the Applicant has not been genuinely trying to reach an agreement with the Respondent, in accordance with the decision of Alcoa. 7

Permitted matters

[68] The AWU submitted that the permitted matters in dispute and for the Protect Action Ballot relate to section 172(1)(a) of the Act and are not only in relation to the income protection insurance. In particular, the AWU stated that it had requested:

•  Night Shift Loading of 30% on all hours, and the Respondent’s offer was to 20%;

•  Rope Allowances on all hours, and the Respondent’s position was for hours worked only; and

•  Payment for Dual Tickets, wherein a payment existed but the operator is required to have both tickets at advanced level and the AWU sought to have the clause worded differently in order to provide flexibility and expanded access to the said payment.

[69] In consideration of the items outlined in paragraph four of this submissions, the AWU submitted that the permitted matters and the reason for the protected action ballot was mainly due to matters of wages and there was a request regarding income protection insurance, and thus meets the definition of the employee and employer relationship reiterated in section 172 (1) (a) of the Act as it relates to the employer and employee relationship.

[70] The AWU submitted key remuneration issues have not been resolved despite the AWU genuinely attempting to resolve the issues between the parties, being the allowance or payment for Dual Tickets.

[71] The AWU referred to the minutes of the bargaining meeting dated 25 August 2020 and referenced by the Respondent’s witness, Ms Tobin. In particular, the AWU relied on a statement of Mr Peter Osborne, an Organiser for the AWU, in the minutes, which reads:

“If you do nothing different you will get the same result. I am no sure whether it is or isn’t beneficial. We accepted the air-fed helmet, the sticking point for the non-trades guys was the dual-ticketed trades people. We feel that from the non-trades side of thing we feel left out. You have made adjustments that are more generous for the trades rather than the non-trades. I don’t think the results are going to change. We want and advanced rigger or and advanced scaffolder paid at the 100% rate.” 8

[72] The AWU submitted that it is evident Mr Osborne communicated to the Respondent that the affected employees would not agree to the draft enterprise agreement due to the minimal differences made by 25 August 2020, and further, that the key outstanding items were not resolved, (being the payment for dual tickets and rigger and/or advanced scaffolder paid at 100% rate).

[73] It is considered that the criteria of s.172 of the Act were satisfied, and that the outstanding matters are within the scope of the Protected Action Ballot Order on the basis that they relate to wages, allowances and employment terms.

Genuine attempts to reach agreement

[74] The persons organising or engaging in industrial action, including where there are bargaining representatives for a proposed enterprise agreement, must be genuinely trying to reach agreement. There are no rigid rules regarding the required point of negotiation that must be reached before this requirement is met. Taking into account all of the relevant circumstances must be assessed to establish whether this test has been met, 9 I consider that all of the statutory tests have been met.

[75] As set out in Construction, Forestry, Mining and Energy Union-Mining and Energy Division v AGL Loy Yang Pty Ltd T/A AGL Loy Yang [2016] FWCFB 6332, the Full Bench of the Commission found that the existence of claims for non-permitted matters does not support a finding that an organisation was not genuinely trying to reach an agreement.

“[40] We are not persuaded that the Deputy President’s failure to make particular findings about each matter that was alleged to be non-permissible is an error. The existence of claims for non-permitted matters does not support a finding that an organisation was not genuinely trying to reach an agreement. If the Deputy President had found that the pursuit of nonpermitted matters meant that the CFMEU was not genuinely trying to reach an agreement he would have been in error. The Deputy President’s findings must on this issue be considered in the context of his overall findings and must be read in conjunction with those findings. Further, it is apparent that regardless of whether the claims were or were not in relation to permitted matters, the Deputy President considered the fact that they were pressed for a period and then withdrawn was relevant to the overall context he had to consider in order to reach his conclusion concerning the genuineness of the CFMEU’s attempts to reach an agreement.”

[76] The AWU stated that it understood that genuinely trying to reach an agreement with the employer requires an assessment of the circumstances in each case. The reasoning in the decision of Total Marine Services Pty Ltd v Maritime Union of Australia 10is adopted, that noted that some form of steps have to be taken, in order to ensure that there was a proper review of the circumstances between the parties regarding the enterprise bargaining negotiations:

“[31] In our view the concept of genuinely trying to reach an agreement involves a finding of fact applied by reference to the circumstances of the particular negotiations. It is not useful to formulate any alternative test or criteria for applying the statutory test because it is the words of s 443 which must be applied. In the course of examining all of the circumstances it may be relevant to consider related matters but ultimately the test in s 443 must be applied.

[32] We agree that it is not appropriate or possible to establish rigid rules for the required point of negotiations that must be reached. All the relevant circumstances must be assessed to establish whether the applicant has met the test or not. This will frequently involve considering the extent of progress in negotiations and the steps taken in order to try and reach an agreement. At the very least one would normally expect the applicant to be able to demonstrate that it has clearly articulated the major items it is seeking for inclusion int the agreement and to have provided a considered response to any demands made by the other side. Premature applications, where sufficient steps have not been taken to satisfy the test that the applicant has genuinely tried to reach an agreement, cannot be granted.” 11

[77] The AWU submitted that Mr Osborne, genuinely attempted to reach an agreement with the employer, and in particular relied on the minutes of the meeting dated 25 August 2020. The AWU submitted that the minutes outlined that the AWU had made concessions with the Respondent in order to reach an agreement. The AWU also relied on paragraphs 19 and 20 of the Form F34B statutory declaration wherein Mr Osborne stated the AWU is genuinely trying to reach an agreement. The evidence of the negotiations and the matters being pursued were compliant with the required tests.

[78] The Full Bench in Alcoa of Australia Ltd v Australian Workers Union (WA) 12 examined the existing authorities relating to whether a party was genuinely trying to reach an agreement is relevant, quoting (AMWU’s emphasis included):

‘It must be borne in mind that a negotiating process is fluid. … Whether the last draft does, or does not, contain permitted matters is not determinative of the issue. In our view, this is not a case where, on any reasonable view, the claims in question clearly involve non-permitted matters. On the contrary, it is strongly arguable that they do not. But, as was pointed out in Australia Post that is not an issue that need be determined on the hearing of an application for a protected ballot order.

We note that a recent Full Bench decision reached a similar conclusion. On the face of the clause in question, it cannot be said that the union is clearly making claims for non-permitted matters and it is strongly arguable that it is not. Further, the union has sought to clarify that it has no such intention. In those circumstances a finding that the union had been and was genuinely trying to reach an agreement was appropriate.’ (Emphasis added)” 13

[79] In the Esso decision, the Full Bench considered the extent to which the Commission is expected to assess claims made during the bargaining process. The Full Bench stated at [63]-[64]:

“It is also relevant to observe that the object of Division 8 of Part 3-3 and scheme of the FW Act reflects the legislative intention that applications for protected action ballot orders be heard and determined quickly. Such an intention is manifested in the following provisions:

(i) the Commission must, as far as practicable, determine such applications within 2 working days after the application is made (s.441(1));

(ii) the Commission may deal with 2 or more applications at the same time if it is satisfied that doing so will not ‘unreasonably delay the determination of any of the applications’ (s.442(b));

(iii) a protected action ballot order must specify a date by which voting in the ballot closes that will enable the ballot ‘to be conducted as expeditiously as practicable’ (s.443(3A)); and

(iv) there is no power to stay a decision to make a protected action ballot order pending the hearing of an appeal (s.606(3)).

The adoption of a construction of s.443(1)(b) which would require the Commission to scrutinise each of the claims advanced by the applicant to determine whether they are about permitted matters is inconsistent with the object of Division 8 of Part 3-3 and the scheme of the FW Act. (Our emphasis)”

[80] The AMWU further cited the Full Bench’s contemplation of the tests that may apply to protected industrial action taken in support of a claim where the representative considered the claim was a permitted matter. The Full Bench’s reasoning is adopted, as per the posited scenario at [65] of the decision:

“A decision rule of the type arguably proposed in Australia Post No.1 and Airport Fuel Services would give rise give rise to the incongruous result that the test posited for the grant of a protected action ballot order (a precondition to the taking of protected industrial action) would be more stringent than the conditions attached to the taking of protected industrial action. It is unlikely that such a result would have been intended by the legislature. (Our emphasis)”

[81] The Full Bench conclusions in Esso and Alcoa have application in the current circumstances. The objections do not undermine that the parties were genuinely trying to reach agreement.

CONCLUSION

[82] I have considered and taken into account all of the submissions and evidence in this matter. For the reasons set out above, the Respondent has failed to discharge the objections against the legislative tests, that is that they have not demonstrated that the Applicants pursuit of the income protection insurance provider was a non-permitted matter for the purposes of s.172 of the Act, and subsequently failed to demonstrate that the objections raised to the application provide a basis for opposing the granting of the applications for a protected action ballot order.

[83] On the basis of the evidence and submissions, as set out, I am satisfied that the applications have been made in accordance with s.437 of the Act. Further, for the reasons set out, I am satisfied that the Applicants have been, and are, genuinely trying to reach an agreement with the employer of the employees who are to be balloted. The Commission is also satisfied that the requirements of s.438 and s.440 of the Act have also been satisfied.

[84] Therefore, pursuant to subsection 443(1)(a) and (b) of the Act, the Commission must make a protected action ballot Order. The Orders shall be made in the terms as sought by the Applicants.

[85] Both Orders have been issued separately, in PR723782 and PR723897.

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

<PR723904>

 1   [2015] FWCFB 210.

 2   Witness Statement of Phil Golby dated 6 October 2020 at 24

 3 [2009] FCAFC 145 at [22].

 4   Alcoa of Australia Ltd v Australian Workers Union (WA)[2010] FWAFB 4889 at [23].

 5   Ibid.

 6   Ibid at [24]

 7   Alcoa of Australia Ltd v Australian Workers Union (WA)[2010] FWAFB 4889 at [23].

 8   AWU Form F34B dated 30 September 2020, Annexure PB-03 at page 3

 9   Total Marine Services Pty Ltd v Maritime Union of Australia [2009] FWAFB 368.

 10   Total Marine Services Pty Ltd v Maritime Union of Australia (2009) 189 IR 407; 62 AILR 101-180; [2009] FWAFB 368

 11   Ibid at [31]-[32]

 12   [2010] FWAFB 4889.

 13   Alcoa of Australia Ltd v Australian Workers Union (WA)[2010] FWAFB 4889 at [28]