Application by the Australian Federation of Air Pilots
[2021] FWC 1012
•24 FEBRUARY 2021
| [2021] FWC 1012 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work (Registered Organisations) Act 2009
s.158(1) RO Act—Rules of organisations
Application by the Australian Federation of Air Pilots
(D2019/5)
DEPUTY PRESIDENT SAUNDERS | NEWCASTLE, 24 FEBRUARY 2021 |
Application by AFAP for consent to alter eligibility rules – disputed class is comprised of Qantas mainline pilots, part time pilots, and independent contractor pilots – AIPA, Qantas and TWU oppose proposed rule alteration – consent to proposed rule alteration.
[1] The Australian Federation of Air Pilots (AFAP) has applied for consent from the Fair Work Commission (Commission) to alter its eligibility rules in accordance with s 158 of the Fair Work (Registered Organisations) Act 2009 (RO Act).
[2] For the reasons given below, I have decided to exercise my discretion to consent to the rule change proposed by the AFAP.
Index
[3] My reasons are structured and organised as follows:
Content | Paragraph |
Proposed alteration to the AFAP’s eligibility rules | [4] |
Rationale for the proposed alteration to the AFAP’s eligibility rules | [5]-[9] |
Relevant history | [10]-[24] |
Qantas’s business | [25]-[26] |
Current union coverage | [27] |
Legislative scheme | [28]-[32] |
Objections to proposed rule alteration | [33]-[35] |
Hearing | [36]-[40] |
Was the proposed rule alteration made under the AFAP’s rules (s 158(2))? | [41]-[74] |
Identifying the relevant class of persons | [75]-[101] |
More conveniently belong and more effectively represent (s 158(4)) | [102]-[285] |
Undertaking to avoid demarcation disputes (s 154(5)) | [286] |
Would the proposed rule alteration contravene an agreement or understanding (s 158(6))? | [287] |
Would the proposed rule alteration change the effect of any order made under s 133 (s 158(7))? | [288]-[289] |
Discretionary considerations | [290]-[320] |
Conclusion | [321]-[322] |
Proposed amendments to the AFAP’s eligibility rules
[4] The AFAP wishes to alter its eligibility rules as follows (underlining is used to indicate the proposed amendments):
“RULE 2 – MEMBERSHIP
1. QUALIFICATION
(a) Any person (not being a person normally employed as a pilot on regular public transport airline services extending beyond the Commonwealth of Australia operated by an Australian airline principally engaged in providing international regular public transport airline services and not being a person normally employed as a pilot on airlines services within or extending beyond the Commonwealth of Australia operated by any of:
(i) Ansett Australia Ltd or Mayne Nickless Ltd trading as Ipec Aviation (“IPEC”);
(ii) any successor assignee or transmittee (whether immediate or not) to or of any of the business of Ansett Australia Ltd or IPEC including a corporation that has acquired or taken over or acquires or takes over the business or part of the business of Ansett Australia Limited or IPEC, in relation to that business or part of the business; and
(iii) any employer not included in the preceding sub-paragraphs (i) or (ii) who is or becomes a successor assignee or transmittee (whether immediate or not) to or of any of the business of any of Ansett Transport Industries (Operations) Pty Limited (“ATI”), East West airlines (Operations) Pty Ltd (“EWA”) or Mayne Nickless Limited trading as Ipec Aviation (“IPEC”) including a corporation that is acquired or taken over or acquires or takes over the business or part of the business of any of ATI, EWA or IPEC, in relation to that business or part of that business)
who is employed or is usually employed either wholly or partly in the profession of pilot in civil aviation, including a person normally employed as an air pilot by a domestic operator other than those specifically excluded by the foregoing provisions of this Rule, but excluding pilots, seeking, or holding, part time employment, where such pilot, offering his services on a part time basis is, permanently established in a career or interests outside the aviation industry, and who holds a Commercial Pilot’s Licence, Senior Commercial Pilot’s Licence, Airline Transport Pilot’s Licence or such equivalent as may be issued from time to time by the Department of Aviation or other appropriate Authority, is eligible for membership, together with such other persons who have been appointed offices of the Federation or who are honorary members pursuant to Rule 2.2 (c).
(b) Without in any way limiting the generality of any other provision of this rule or being limited thereby, all persons who are normally employed as pilots on airline services within or extending beyond the Commonwealth of Australia operated in whole or in part and under any name by any of:
(i) Virgin Blue Airlines Pty Limited ABN 36 090 670 965;
(ii) Virgin Blue Holdings Limited ABN 54 100 686 226;
(iii) Virgin Blue International (Holdings) Pty Ltd ABN 89 125 398 754;
(iv) Virgin Blue International Airlines Pty Ltd ABN 63 125 580 823;
(v) Express Blue Air Freight Pty Ltd ABN 50 104 355 508;
(vi) Toll Holdings Limited ABN 25 006 592 089;
(vii) Any successor, transmittee or assignee (whether immediate or not) of the whole or a part of the business of any company or entity referred to in any of the preceding sub paragraphs (i) to (vi) above; and/or
(viii) Any subsidiary related body corporate or associated entity (as those words are defined in the Corporations Act 2001) of any company or entity referred to in any of the preceding sub-paragraphs (i) to (vii) above shall be eligible for membership.
(c) Without in any way limiting the generality of any other provision of this rule or being limited thereby, the following persons shall be eligible for membership:
(i) any person who is normally employed or seeking to be employed as a pilot on airline services within or extending beyond the Commonwealth of Australia operated by an Australian airline: and
(ii) any person, who, being an independent contractor, would if as an employee performing the work of the kind they usually perform as an independent contractor, qualify for membership in accordance with this Rule.”
Rationale for the proposed alteration to the AFAP’s eligibility rules
[5] Under the AFAP’s current eligibility rule, it can, subject to the limitations described below (the Exclusions), cover all persons employed or usually employed as pilots. As such, the current rule covers both domestic and international pilots; pilots flying any type of aircraft (helicopters, propeller planes, jets, etc); and all types of flying (eg agricultural, recreational, cargo, passenger transport, emergency service, etc).
Exclusions
[6] Three express exclusions apply to the broad coverage conferred by rule 2.1 of the AFAP rules. In plain language, they are as follows:
(a) first, certain types of pilots flying for any Australian airline principally engaged in scheduled international passenger flying cannot join the AFAP (Qantas Exclusion). 1 In practice, this exception only applies to international and, potentially, domestic2 pilots flying for Qantas Airways Ltd (Qantas). This is because (i) although Jetstar Airways Pty Ltd (Jetstar) operates some international flights, it is principally a domestic airline, with the result that the AFAP can cover its international pilots pursuant to rule 2.1(a) of the AFAP’s rules and (ii) although Virgin Blue International Airlines Pty Ltd is both an Australian and principally international airline, the AFAP can cover its pilots pursuant to rule 2.1(b) of the AFAP’s rules;
(b) secondly, pilots employed by any airline which is the successor to the former businesses of Ansett, Ipec or East West cannot join the AFAP (Pilots’ Dispute Exclusion). 3 I accept that, in practice, this exception has no work to do because following the collapse of Ansett, it (including East West) was broken up and its business disappeared. It had no successor. The same is true for Ipec. Because this exception has no work to do, the s 158(4) question does not have to be answered in respect of it; and
(c) pilots holding advanced licences with a career outside of aviation and who only fly on a part-time basis cannot join the AFAP (Part-Time Exclusion). 4
[7] None of these exclusions apply to pilots employed by the Virgin corporate group or the Toll group. 5 All pilots employed within those businesses may join the AFAP.
[8] Further, as a matter of construction, rule 2.1 of the AFAP’s rules does not cover pilots (such as Approved Testing Officers) who work as long-term independent contractors (Contractor Exclusion). That is because independent contractors are not “employed or usually employed” as pilots.
Purpose of amendment to rule 2.1 of the AFAP’s rules
[9] The AFAP’s intention for its proposal to amend rule 2.1 is to overcome the Exclusions described above so as to provide the AFAP with the ability to operate as an occupational union for all pilots in Australia. The AFAP submits that the Exceptions are historical and there is no present justification for maintaining them. The relevant history is summarised below.
Relevant history
[10] The AFAP was established (under a different name) in 1938. It covered all employed pilots (both domestic and international). A version of the Part Time Exclusion has appeared in the AFAP’s rules for many decades. 6
[11] After World War II, under the “two airlines” policy, there were only two domestic carriers — Ansett and Trans Australia Airlines (TAA) — and one international airline, Qantas. The AFAP had a dedicated overseas branch to cover Qantas pilots. In 1981, the overseas branch broke away and formed the union now known as the Australian and International Pilots’ Association (AIPA).
[12] In 1985 and 1986, respectively, both the AFAP and AIPA became registered organisations. The AFAP was entitled to cover pilots, subject to various exceptions. The AIPA covered only Qantas international pilots. Then, as now, the Transport Workers’ Union (TWU) also had the capacity to cover pilots, but historically it has had only very small numbers of pilot members.
[13] In September 1989, the pilots’ dispute occurred. In support of pay increases beyond those provided for by the Commission’s wage fixing principles, the AFAP organised bans and the resignation en masse of pilots working for the major domestic airlines: Ansett, Australian Airlines (the former TAA), East West and Ipec (a cargo carrier). The employers refused to re-hire the pilots, and replaced them with other pilots who were generally not members of the AFAP.
[14] These four airlines sought demarcation orders against the AFAP under s 118A of the Industrial Relations Act 1988 (Cth) (IR Act). In 1992, Qantas acquired Australian Airlines, and by September 1993 was itself employing pilots to fly domestically under the Australian Airlines brand. On that basis, it became a fifth applicant for demarcation orders.
[15] On 1 May 1995, SDP Hancock made a demarcation order, effective for one year, depriving the AFAP of the right to represent pilots employed by the five applicant airlines. As provided for by s 118A, on 22 February 1996, this demarcation order was then reflected in amendments to the AFAP’s rules, preventing it from covering any pilots employed by the five applicant airlines.
[16] On 12 February 1996, the AIPA obtained a further demarcation order against the AFAP, also operative for one year, which (after retrospective variation by the Full Bench) deprived the AFAP of the right to enrol pilots in any successor business to Ansett, East West or Ipec. Such an order was necessary because of consolidation in the industry which followed deregulation in 1990. Indeed, by 1996, East West had already been absorbed into Ansett, Ipec had ceased to employ any pilots, and Air New Zealand was known to be interested in purchasing Ansett.
[17] Pursuant to s 118A, this second demarcation order was then referred to VP McIntyre for uplifting into the AFAP’s rules. At the hearing, the AIPA (without opposition from the AFAP or Qantas) proposed that a clause in the form of the Pilots’ Dispute Exclusion be inserted into the AFAP’s rules. The same proposal involved the removal of the specific exclusions for Qantas and Australian Airlines pilots. On 16 July 1996, VP McIntyre approved this proposal. 7
[18] The AFAP contends that the exclusion of any reference to Qantas meant that, as a matter of law, once the second demarcation order expired (on 11 February 1997), the AFAP would regain the right to represent Qantas’s domestic pilots. The AIPA opposes this contention and I address it below in my determination of the disputed class of persons impacted by the proposed rule change. In any event, even after 11 February 1997, the AFAP has in practice refrained from seeking to represent Qantas’s domestic pilots.
[19] The aviation industry changed significantly after the 1996 rule change. In 2000, Virgin commenced flying domestically, and later started international flying. In 2001, Ansett collapsed. In 2004, Jetstar (owned by the Qantas group) started flying domestically, and in 2006 it began international flying. In 2007, Tiger commenced domestic flying.
[20] In 2007, the Commission permitted the AIPA to alter its rules so as to cover pilots employed by Jetstar, and other subsidiaries within the Qantas group. In that case, it was the AFAP which was the incumbent union. The AFAP objected on the basis that it could more conveniently and effectively represent these pilots, but the objection was dismissed by SDP Kaufman, effectively because the AIPA would be an equally convenient and effective union. 8
[21] In 2009, an organisation known as VIPA was registered. Its rules permit it to represent all pilots employed by the Virgin group.
[22] In 2013, Virgin acquired a majority stake in Tiger, and so VIPA became eligible to represent Tiger pilots, as well as the AFAP.
[23] On 6 October 2017, the AFAP’s Convention purportedly voted to amend its eligibility rule in accordance with its current proposal to amend rule 2.1 of its rules, and an application was made to the Commission for consent to the change. However, on 18 June 2018, the application was refused by SDP Hamberger, on grounds that the resolution had not attracted the special majority required by the AFAP’s rules.
[24] On 19 October 2018, another Convention was held, and this time the AFAP contends that its proposal to amend rule 2.1 of its rules was passed by a special majority. The Convention also authorised a delegation to meet with the AIPA with a view to merging and thereby creating a “single pilot union” for Australia.
Qantas’s business
[25] Since at least 2019, the Qantas group has conducted a range of complex businesses. Its Australian-based operations include the following activities:
• Qantas operates scheduled international and domestic passenger flights under the Qantas brand, generally using pilots employed by Qantas;
• Jetstar operates domestic and international passenger flights, generally using pilots employed by Jetstar;
• Sunstate and Eastern Airlines operate scheduled regional domestic flights under the Qantaslink brand, generally using pilots employed by those subsidiaries;
• Network Aviation operates charter passenger flights for fly-in fly-out workers from Perth airport under the Network Aviation brand, generally using pilots employed by that subsidiary; and
• Express Freighters Australia (formerly named Qantas Ltd) operates domestic cargo flights under the Qantas Freight brand, generally using pilots employed by that subsidiary.
[26] There is capacity for the movement of pilots between different companies in the Qantas group, either on a temporary or a permanent basis. Since Qantas lifted a hiring freeze in 2016 there has been significant movement within the group.
Current union coverage
[27] Putting aside the position of the TWU, the position with respect to union coverage, at present, is as follows:
Virgin Group
• Virgin: pilots (international and domestic) may join the AFAP or VIPA. (Under its rules, international pilots may also join the AIPA, but the AIPA has never recruited these pilots);
• Tiger: passenger pilots (domestic) may join the AFAP or VIPA;
• Cargo flying: pilots (domestic or international) may join the AFAP or VIPA;
Qantas Group
• Qantas: pilots (international and domestic) may join the AIPA. (The AFAP contends that under its rules, domestic pilots may also join the AFAP, although the AFAP has not actively recruited them in recent times);
• Jetstar: pilots (international and domestic) may join the AIPA or the AFAP;
• Qantaslink (ie, Eastern or Sunstate): pilots (domestic) may join the AIPA or the AFAP;
• Network Aviation: pilots (domestic) may join the AIPA or the AFAP;
• Express Freighters Australia (trading as Qantas Freight): cargo pilots (international and domestic) may join the AIPA or the AFAP;
Other flying (apart from the flying described above)
• All other international pilots (flying cargo planes, VIP/private planes, etc) may join the AFAP; and
• All other domestic pilots may join the AFAP, subject to the Exclusions.
Legislative scheme
[28] Section 158 of the RO Act governs a proposed alteration to the eligibility rules of an organisation registered under the RO Act, such as the AFAP. Section 158 provides:
“158 Change of name or alteration of eligibility rules of organisation
(1) A change in the name of an organisation, or an alteration of the eligibility rules of an organisation, does not take effect unless:
(a) in the case of a change in the name of the organisation – the FWC consents to the change under this section; or
(b) in the case of an alteration of the eligibility rules of the organisation:
(i) the FWC consents to the alteration under this section; or
(ii) the General Manager consents to the alteration under section 158A.
(2) The FWC may consent to a change or alteration in whole or part, but must not consent unless the FWC is satisfied that the change or alteration has been made under the rules of the organisation.
(3) The FWC must not consent to a change in the name of an organisation unless the FWC is satisfied that the proposed new name of the organisation:
(a) this is not the same as the name of another organisation; and
(b) is not so similar to the name of another organisation as to be likely to cause confusion.
(4) The FWC must not consent to an alteration of the eligibility rules of an organisation if, in relation to persons who would be eligible for membership because of the alteration, there is, in the opinion of the FWC, another organisation:
(a) to which those persons could more conveniently belong; and
(b) that would more effectively represent those members.
(5) However, subsection (4) does not apply if the FWC accepts an undertaking from the organisation seeking the alteration that the FWC considers appropriate to avoid demarcation disputes that might otherwise arise from an overlap between the eligibility rules of that organisation and the eligibility rules of the other organisation.
(6) The FWC may refuse to consent to an alteration of the eligibility rules of an organisation if satisfied that the alteration would contravene an agreement or understanding to which the organisation is a party and that deals with the organisation’s right to represent under this Act and the Fair Work Act the industrial interests of a particular class or group of persons.
(7) The FWC may also refuse to consent to an alteration of the eligibility rules of an organisation if it:
(a) is satisfied that the alteration would change the effect of any order made by the FWC under section 133 about the right of the organisation to represent under this Act and the Fair Work Act the industrial interests of a particular class or group of employees; and
(b) considers that such a change would give rise to a serious risk of a demarcation dispute which would prevent, obstruct or restrict the performance of work in an industry, or harm the business of an employer.
(8) Subsections (6) and (7) do not limit the grounds on which the FWC may refuse to consent to an alteration of the eligibility rules of an organisation.
(9) Where the FWC consents, under subsection (1) to a change or alteration, the change or alteration takes effect on:
(a) where a date is specified in the consent – that date; or
(b) in any other case – the day of the consent.
(10) This section does not apply to a change in the name, or an alteration of the eligibility rules, of an organisation that is:
(a) determined by the FWC under subsection 163(7); or
(b) proposed to be made for the purposes of an amalgamation under Part 2 of Chapter 3 or Division 4 of Part 7 of Chapter 11; or
(c) proposed to be made for the purposes of a withdrawal from amalgamation under Part 3 of Chapter 3.”
[29] Regulation 124 of the Fair Work (Registered Organisations) Regulations 2009 (RO Regulations) permits certain persons to object to the grant of consent to an eligibility rule change under s 158 as follows:
“124 Change of name or alteration of eligibility rules of organisation - objections (s 158)
(1) Any interested organisation, association or person (the objector) may, no later than 35 days after a notice of the receipt of an application under subregulation 121(1) (the original application) is published in the Gazette, lodge with the FWC a notice of objection to the change of name, or the alteration of the eligibility rules, to which the original application relates.
(2) The notice of objection must:
(a) be lodged with the FWC; and
(b) comply with the requirements of regulation 14.
(3) The FWC may allow an objector to amend a notice of objection if:
(a) a further application is made; and
(b) the objector satisfies the FWC that the objector has further grounds for objection arising from the application mentioned in paragraph (a).
(4) Within 7 days after a notice of objection is lodged with the FWC, the objector must serve a copy of the notice on the organisation that lodged the original application.
(5) An organisation:
(a) may, no later than 14 days after service on it under subregulation (4) of a copy of the notice of objection, lodge with the FWC, in answer to the objection, a written statement signed by an officer of the organisation authorised to sign the statement; and
(b) must, no later than 7 days after lodging a written statement under paragraph (a), serve a copy of the statement on the objector.”
General principles
[30] In AMWU v ResMed Limited, 9 a Full Bench of the Commission adopted the following statement from Re Australian Licenced Aircraft Engineers Association10concerning the general principles which are applicable to the interpretation and application of s 158 of the RO Act [references omitted]:
“[12] Section 158, in respect of alterations to eligibility rules, is the same in substance as s.204 of the former Workplace Relations Act 1996 (WR Act). In Re CPSU, Community and Public Sector Union a Full Bench of the Australian Industrial Relations Commission (AIRC) considered the nature of the discretionary power exercised in relation to eligibility rules alterations under s.204 of the WR Act. The Full Bench said:
‘[71] The discretion under section 204 is exercisable by reference to several ‘statutory’ considerations, some of which if satisfied condition the exercise of the discretion. Some other considerations are also prescribed by the section and may be given determinative weight at the discretion of the decision maker. The discretion may also be exercised by reference to considerations that are not directly specified by the section...
[72] ... However subsections 204(2), (3), and (4) require consent to be refused if the designated Presidential Member is satisfied or of the opinion as to the criteria specified. In relation to those criteria at least, and subject to the qualification in subsection 204(5), the discretion under section 204 may be said to be structured, although, as his Honour observed: ‘On the other hand, the failure to satisfy those requirements (the subsection 204(4) criteria) does not oblige a designated Presidential member to give consent to such an alteration.’ The criteria in subsections 204(6A) and 204(6B) are expressed in less mandatory terms. Subsection 204(6C) explicitly opens the exercise of the discretion to consideration of grounds that are not limited to those grounds. Moreover, as Williams SDP held ‘in determining an application for consent … the public interest as provided for in s.90 is a relevant and significant consideration’. Although Mr Bromberg in his submissions suggested there was doubt about whether the public interest could relevantly be considered, we consider that the weight of Commission precedents, established practice, and the combined effect of subsection 204(6C) and Regulation 51 leave little room for any such doubt.’
[13] Subsections 204(2), (3), (4) and (5) of the WR Act referred to in the above passage correspond with the same numbered subsections in the current s.158. Subsections 204(6A), (6B) and (6C) correspond with the current subsections 158(6), (7) and (8). The Regulation 51 referred to (that is, reg.51 of the Workplace Relations Regulations) corresponds with regs.124 and 14 of the RO Regulations.
[14] I consider that the Full Bench’s analysis in Re CPSU is, subject to one proviso, fully applicable to s.158 of the RO Act. Section 158(2) provides that the Commission “may” consent (relevantly) to a change or alteration to the eligibility rules of an organisation. Where a statutory conferral of power uses the word “may”, the exercise of the power is discretionary, unless the statute demonstrates a contrary intention. The discretion conferred by s.158(2) is conditioned in a number of respects. Subsection (2) requires that consent not be granted unless the Commission is satisfied that the rules alteration has been made under the rules of the organisation. Subsection (4) also requires that consent not be granted if, in the Commission’s opinion, the persons who would become eligible for membership because of the alteration could more conveniently belong to and be more effectively represented by another organisation. However, subsections (2) and (4) do not limit the grounds upon which consent may be refused, as subsections (6), (7) and (8) make clear. Subsections (6) and (7) identify specific grounds upon which the Commission, in the exercise of its discretion, may refuse consent, and subsection (8) makes it clear that the Commission has a general discretion as to the grounds upon which it may refuse to grant its consent.
[15] The proviso is that there is no equivalent in the RO Act to s.90 of the WR Act, which required the AIRC to take the public interest into account in the performance of its functions. The Commission’s discretion under s.158 must, however, be exercised in accordance with usual principles - that is, it must be exercised in a bona fide fashion having regard to the policy and purpose of the statute. In this respect, s.5 of the RO Act is of significance, in that it sets out the legislature’s intention in enacting the RO Act. Section 5 provides (excluding the note):
Parliament’s intention in enacting this Act
(1) It is Parliament's intention in enacting this Act to enhance relations within workplaces between federal system employers and federal system employees and to reduce the adverse effects of industrial disputation.
(2) Parliament considers that those relations will be enhanced and those adverse effects will be reduced, if associations of employers and employees are required to meet the standards set out in this Act in order to gain the rights and privileges accorded to associations under this Act and the Fair Work Act.
(3) The standards set out in this Act:
(a) ensure that employer and employee organisations registered under this Act are representative of and accountable to their members, and are able to operate effectively; and
(b) encourage members to participate in the affairs of organisations to which they belong; and
(c) encourage the efficient management of organisations and high standards of accountability of organisations to their members; and
(d) provide for the democratic functioning and control of organisations; and
(e) facilitate the registration of a diverse range of employer and employee organisations.
(4) It is also Parliament's intention in enacting this Act to assist employers and employees to promote and protect their economic and social interests through the formation of employer and employee organisations, by providing for the registration of those associations and according rights and privileges to them once registered.
(5) Parliament recognises and respects the role of employer and employee organisations in facilitating the operation of the workplace relations system.
[16] Leaving aside the mandatory provisions in subsections (2) and (4), the Commission would endeavour to exercise its discretionary power to grant or refuse consent to alterations to eligibility rules in a way which gives effect to the legislature’s intention as expressed in s.5 and as otherwise expressed in the text of the RO Act.
[17] Section 158(2) provides that the Commission may consent to a change or alteration “in whole or part”. Section 204(2) of the WR Act made provision to the same effect, as did the Industrial Relations Act 1988 and the Conciliation and Arbitration Act 1904. In National Tertiary Education Industry Union v Community and Public Sector Union the AIRC (Williams SDP) determined that power to consent to an alteration in part was not confined to the “blue pencil test” - that is, “the physical deletion or striking out of parts of the proposed alteration”…
[18] Where it has been determined that partial consent should be given to an alteration to an eligibility rule by way of the addition of a textual limitation, it was held in NTEU v CPSU and in Re Shop, Distributive and Allied Employees’ Association (Boulton J) that it was not necessary that the partial alteration again be approved in accordance with the organisation’s rules.”
[31] The Full Court of the Federal Court 11 dismissed an application by Resmed for judicial review of the decision of the Full Bench of the Commission in ResMed, albeit the Full Court did not consider the general principles set out above.
[32] I will apply the general principles set out in paragraph [30] above in determining the AFAP’s application for consent to alter its eligibility rules. In addition to those general principles, I make the following observations in relation to the way in which my task under s 158 of the RO Act must be performed:
(a) Unlike the union monopoly coverage situation conferred by the relevant legislation prior to the enactment of the Workplace Relations and Other Legislation Amendment Act 1996 (Cth), 12 the current statutory regime permits competition between unions for members, provided the requirements of s 158 of the RO Act are met. In Re CPSU, the Full Bench held that it was a purpose of the Workplace Relations Act 1996 (WR Act) “to allow for competition between organisations; and, to discourage primarily, if not only, that kind of competition which manifests as a demarcation dispute. That purpose may properly be said to be consistent with encouraging competition between organisations”.13 The reasons the Full Bench reached that conclusion included the terms of s 204(4) of the WR Act (which are materially the same as s 158(4) of the RO Act) and the inclusion of a new object in the WR Act directed to ensuring “freedom of association, including the rights of employees and employers to join an organisation or association of their choice…”14 [emphasis added]. At the time Re CPSU was decided, the statutory regime concerning amendments to an organisation’s rules were contained within the WR Act. In contrast, the statutory regime concerning amendments to an organisation’s rules is now contained in the RO Act. The objects of the RO Act do not include joining an organisation of an employee’s “choice” or any form of “freedom of association”. The objects of the Fair Work Act 2009 (Cth) (FW Act) include “enabling fairness and representation at work and the prevention of discrimination by recognising the right to freedom of association and the right to be represented”,15 but do not expressly include the right to join an organisation of an employee’s “choice”. Notwithstanding this difference between the objects of the WR Act and the FW Act/RO Act, it is clear from, inter alia, s 158(4) of the RO Act that the current statutory regime permits competition between unions for members, provided the requirements of s 158 of the RO Act are met.16 It follows, in my view, that the intended purpose and effect of s 158 of the RO Act is to allow for competition between organisations; and, to discourage primarily, if not only, that kind of competition which manifests as a demarcation dispute.
(b) The application of s 158(4) of the RO Act involves a comparative exercise between the relative capacities of the organisations in question. 17 The expression “more conveniently belong” in s 158(4) is oriented towards the perceived convenience of the employees who would become eligible because of the proposed alteration.18 The expression “more effectively represent” concerns the relative capability of the organisations in question to effectively represent the industrial interests of that class of employees.19 The two limbs of the one test are connected and many of the considerations relevant to assessing the “effectively represent” limb may be relevant to the “conveniently belong” limb and vice versa.20
(c) To refuse an application under s 158(4), the relevant employees must more conveniently belong to the other organisation, and it must also be the case that the other organisation would represent them more effectively. 21
(d) To apply s 158(4) of the RO Act, it is necessary to identify the class of “persons who would be eligible for membership because of the alteration” in order that the specified statutory tests for consent may be applied to that class. 22 Identification of that class requires a comparison of the existing coverage of the organisation to the coverage it would have if the Commission were to consent to the proposed rule alteration.
(e) Section 158(4) of the RO Act is conditional: it does not apply if the Commission accepts an undertaking from the applicant organisation that it considers appropriate to avoid demarcation disputes that might otherwise arise. 23
(f) If (and only if 24) the Commission forms the view that a “better organisation” exists for all or part of the relevant employees, then the Commission must consider whether to accept an undertaking under s 158(5). If any such undertaking is not accepted, the proposed rule alteration must be refused insofar as it applies to the class of persons for which a “better organisation” exists, save that an applicant may be afforded an opportunity to provide a different undertaking which may be acceptable.25
(g) The test of which is the better organisation under s 158(4) is to be applied at the time of the decision by the Commission. The test involves broad value judgments. 26
Objections to proposed rule change
[33] The AIPA objects to the Application on the following grounds (particulars omitted): 27
1. That, in relation to subsection 158(4) persons who would be eligible for membership of the applicant because of the alteration could:
i. more conveniently belong to AIPA, and
ii. AIPA would more effectively represent those members.
2. That the alteration would be contrary to the objects of the Act and contrary to the public interest.
3. That the Commission would not set aside an arrangement for the representation of Qantas Pilots.
4. That the Commission would not set aside a previous Order of the Australian Industrial Relations Commission.
5. That in the circumstances, the Commission would not accept the undertaking by the AFAP that it will avoid demarcation disputes.
6. That the prescribed conditions for the application for consent of the Fair Work Commission have not been complied with by the applicant.
7. The proposed alterations do not clearly disclose the intended expansion of the applicant's coverage.
[34] Qantas objects to the Application on the following grounds (particulars omitted): 28
1. It is not readily apparent whether the proposed alteration to the eligibility rule (Rule 2.1) of the registered rules of the AFAP set out in the Application was made in accordance with the AFAP Rules. If it was not, the proposed alteration must not be consented to by the Commission pursuant to section 158(2) of the Fair Work (Registered Organisations) Act 2009 (Cth).
2. The proposed alteration to the eligibility rule of the AFAP Rules set out in the Application must not be consented to by the Commission pursuant to section 158(4) of the FW (RO) Act because, in relation to persons who would be eligible for membership of the AFAP because of the alteration, there is another organisation:
(a) To which those persons could more conveniently belong; and
(b) That would more effectively represent those members.
3. The proposed alteration to the eligibility rule in the AFAP Rules is vague and fails to specify:
(a) the reason for the proposal; and/or
(b) the effect of the proposal,
with sufficient particularity to allow the proposal to be properly considered, as required by Regulation 121(2)(b)(ii) of the Fair Work (Registered Organisation) Regulations 2009 (Cth).
4. The Application, if consented to, would likely give rise to demarcation and other disputes which would cause industrial disharmony and be contrary to the public interest.
5. The Application, if consented to, would extend the eligibility rule in the AFAP Rules to cover a class of persons whom the AFAP is not currently eligible to represent.
6. The Application does not properly represent the current position in relation to the ability or otherwise of the AFAP to represent Australian air pilots.
7. The Application, if consented to, would contravene:
(a) an agreement or understanding to which the AFAP is a party that deals with the AFAP's rights to represent the industrial interests of persons who would be eligible to become members of AFAP; and
(b) an Order of the Fair Work Commission that deals with the AFAP's rights to represent the industrial interests of persons who would be eligible to become members of AFAP.
[35] The TWU objects to the Application on the following grounds: 29
1. In relation to those persons who would otherwise be eligible for membership of the AFAP because in relation to the proposed alteration there is another organisation:
(a) to which those persons could more conveniently belong; and
(b) which could more effectively represent those persons.
Particulars
(i) The TWU is a registered organisation to which a number of persons sought to be covered by the proposed alteration might more conveniently belong;
(ii) The TWU has particular knowledge and experience in the representation of independent contractors than the AFAP;
(iii) The proposed alteration would enable persons covered by the eligibility rules of the TWU to become members of the AFAP;
(iv) The AIPA also has coverage of pilots directly engaged by Qantas;
(v) No other registered organisation has coverage rights of pilots directly employed by Qantas;
(vi) Persons who would be eligible for membership of the AFAP because of the proposed alteration may already be members of the AIPA or the TWU;
(vii) The TWU has the experience, facilities, resources and officials to advance the industrial interests of those persons who are eligible to be members of the TWU better than the AFAP; and
(viii) The TWU would more effectively represent those persons who are eligible to be members of the TWU than the AFAP.
2. The application would increase the risk of industrial disharmony.
Particulars
(i) The proposed alteration to the eligibility rules of the AFAP is likely to lead to competition for membership with the TWU and other registered organisations including the AIPA, resulting in the potential for demarcation disputes between the three registered organisations which would have a consequential effect on the Australian aviation industry.
(ii) Any industrial dispute may have the effect of obstructing or restricting the performance of work in the industry, may harm the business of an employer and may be contrary to the public interest.
3. The alteration of the eligibility rules of the AFAP would be contrary to the objects of the Fair Work (Registered Organisations) Act 2009 in that it is contrary to the public interest.
Hearing
[36] The Application was the subject of a hearing before the Commission, by video conference, on 3 – 4 August, 19 – 20 and 23 – 24 November, and 7 – 8 December 2020. The AFAP adduced evidence from the following witnesses:
(a) Simon Jon Lutton, Executive Director of the AFAP;
(b) Captain David Harget, Check Captain with Eastern Australian Airlines and Chairman of the Board of Directors of the Australian Air Pilots Mutual Benefit Fund;
(c) Captain Louise Pole, President of the AFAP;
(d) Marcus Kent Diamond, Safety and Technical Manager of the AFAP;
(e) Andrew Zoltan Molnar, Legal Counsel of the AFAP;
(f) Captain Benjamin Bollen, Captain with Jetstar, Airways, Chair of the Council of the AFAP and Federal Vice President – Administration and Finance of the AFAP; and
(g) Deanna Louise Cain, Senior Industrial/Legal Officer of the AFAP.
[37] The following witnesses were called by the AIPA to give evidence:
(a) Captain Shane Loney, Captain with Qantas and Vice President Safety and Technical Director of the AIPA;
(b) Sonia Chandra, Senior In-House Lawyer of the AIPA;
(c) Hugh Martin Windsor, Welfare Liaison Officer of the AIPA;
(d) Captain Alric Jason Beavan, Captain with Qantas and Vice President of the AIPA; and
(e) Captain Alan Pickering, Captain with Qantas.
[38] The following witnesses were called by Qantas to give evidence:
(a) Wayne Francis Kearns, retired Check and Training Pilot formerly with Qantas; and
(b) Douglas Peter Alley, Head of Base Operations, Flight Operations with Qantas.
[39] The TWU did not call any witnesses or tender any evidence. The TWU filed written submissions but did not otherwise take any part in the hearing.
[40] In determining the Application and forming the necessary broad value judgments required by s 158 of the RO Act, I have paid careful attention to all the evidence adduced, 30 even though I have not included express references to all such evidence in the reasons for my decision. I have also had regard to the oral and written submissions made on behalf of the AFAP, AIPA, Qantas and the TWU.
Was the proposed rule alteration made under the AFAP’s rules (s 158(2))?
AIPA’s submissions re non-compliance with the AFAP’s rules
[41] The AIPA commences its submissions on this issue by observing that only 22 out of 32 votes were cast in support of the rule amendment proposal at the AFAP’s Annual Convention on 19 October 2018. Because a two-third majority was required, the vote of 22 out of 32 (or 68.75%) was within one vote of failing.
[42] The AIPA submits that amendments to an organisation’s rules are of great importance and there should be strict compliance with the procedures set down to achieve them (Wright v McLeod [1983] FCA 351; 51 ALR 483; Squires, Richard James v Stephenson, Keith (1983) 4 IR 1).
[43] The AIPA submits that in these proceedings the Commission will be mindful not only of the mandatory nature of the relevant rules but of the recent litigation involving the parties emphasising the need for strict compliance with the AFAP’s alteration rules. As to the latter point, reference is made to the issue of the AFAP’s compliance with its rules in Australian Federation of Air Pilots, 31 where SDP Hamberger said:
“… There are a number of features in the Rules designed to ensure maximum attendance at meetings of the Convention. Indeed, Rule 1 expressly provides that representation of all members of the AFAP at meetings of the Convention is ‘mandatory’. There are significant restrictions placed on the use of proxies. The quorum for the Convention is set at 75 per cent. There are also penalties for Councils who fail to send their full complement of representatives. If all elected representatives had complied with their obligation to attend the meeting of the Convention (or send a proxy), alterations to the Rules could have been approved by the votes of only two-thirds of those attending.”
[44] The AIPA submits that rule 7 of the AFAP’s rules deals with the Convention of the AFAP and rule 1.14 deals with the amendments to the AFAP’s rules. Those rules cannot be amended except by resolution of the Convention. There are rules governing the calling of the Convention. Rule 7.3(c) states:
“Members of the Convention including the duly elected Council Committee Representatives, Federal Officers and others nominated to be in attendance (as provided under clause 1 of this rule) shall be notified in writing a minimum of 42 days in advance of such Annual Convention. Notification shall clearly specify the time of commencement, the venue, the schedule to be followed and a preliminary agenda. A minimum of 21 days before Convention sits all relevant final working papers will be distributed to Convention delegates.”
[45] The Convention was held on 19 October 2018. As a result, the AIPA submits that members of the Convention had to be provided with two documents:
(a) first, the notification in writing a minimum of 42 days in advance - in this case by 6 September 2018. The notification must state the time of commencement of the convention, the venue, the schedule and an agenda; and
(b) secondly, the final working papers which must be provided a minimum of 21 days in advance - in this case by 27 September 2018.
[46] The AIPA refers to the evidence of Captain Pole in which she states:
• 25 July 2018 - Captain Gravitis was not a Convention member. Nor was Captain Baynham. There were at that time 38 identified Convention members.
• 13 August 2018 - the Convention members on the identified list received the notification in writing. Captain Gravitis did not. Captain Baynham did not. The notification stated the time of commencement of the Convention, the venue, the schedule and an agenda.
• 24 September 2018 - all members of the council committees received the working papers. This included Captain Gravitis. It did not include Captain Baynham. The working papers did not state the time of commencement of the Convention, the venue, the schedule or an agenda.
• 2 October 2018 - Captain Gravitas was appointed Vice Chair of the Rex Pilot Council Committee (becoming a Convention vote holder).
• 2 October 2018 - Captain Gravitis was provided with written notification of the Convention (distributed via email and post on 2 October 2018).
• 5 October 2018 - Captain Baynham was appointed Vice Chair of Cobham Council (becoming a Convention vote holder).
• 19 October 2018 - Captain Gravitis appointed Captain Darroch as his proxy at the Convention.
• 19 October 2018 - Captain Darroch was present at the Convention. He voted. His vote and the vote of Captain Gravitis (cast by proxy) were among the 32 votes cast. Captain Baynham was present at the Convention. She voted.
[47] On the basis of these facts the AIPA submits that the Commission should find that:
• Captain Gravitas was not ‘notified in writing a minimum of 42 days in advance of such Annual Convention’ for the purpose of rule 7.3(c) of the AFAP’s rules. The document he received 42 days in advance was the working papers. It did not state the time of commencement of the Convention, the venue, the schedule and an agenda; and
• Captain Baynham was not ‘notified in writing a minimum of 42 days in advance of such Annual Convention’ for the purpose of rule 7.3(c) of the AFAP’s rules.
[48] The AIPA relies on AD Lang’s leading text, Horsley’s Meetings: Procedure, Law and Practice, 5th edition, in which it is stated that:
“proper notice of meeting is one of the requisites of a validly constituted meeting. It is essential that a meeting be properly convened. Where a meeting is convened without proper notice, the meeting is null and void to all intents and purposes, and no business can be validly transacted at the meeting…. The courts have tended to interpret requirements as to notice strictly, and accordingly every such requirement set out in the body’s rules and any applicable statute should be complied with precisely… The prima facie rule is that, in the absence of express provision to the contrary, meetings must be summoned in some such way as will bring notice of them to every member … if rules do not stipulate a procedure to be adopted when calling meetings, they need to be convened in a way that will bring notice of each meeting to every member.”
[49] The AIPA also relies on a recent judgment of the Federal Court in which it was held:
“It was not obviously in contest that the meeting at which the Divisional Executive Resolution was passed would be a nullity if it was called contrary to the requirements of the Divisional Rules. The respondents referred the court in that respect to Myer Queenstown Garden Plaza Pty Ltd v Port Adelaide City Corp (1975) 11 SASR 504, 527 (Wells J). I accept that proposition, as well as the related proposition that, subject to any later ratification, the business conducted at such a meeting would also be a nullity. The validity of the Divisional Executive Resolution thus depends upon the validity of the meeting from which it emerged. ”32
[50] Applying these principles to this case, the AIPA submits that the law results in the following:
• the rules governing the amendment of rules, including meetings at which rules are amended, are strictly construed and are mandatory;
• the notification given to Captain Gravitas and Captain Baynham was inadequate under the AFAP’s rules;
• the business conducted at the meeting, being convened without proper notice, was a nullity; and
• there were two simple available solutions to the AFAP to deal with the possibility that a committee might appoint a new person entitled to be a Convention delegate in the weeks leading to the Convention. The first is that all of the members of the various council committees could have been sent the notification in August, just as all of the members of the council committees were sent the working papers in September. That way, if one council committee decided to appoint a new person in the weeks leading to the Convention, the notification would already have been provided to him or her containing the time of commencement of the Convention, the venue, the schedule and an agenda. Second, one could clarify from Convention representatives in July whether or not they were going to attend the Convention or resign their position prior to the Convention. That way, any replacement would not be given short notice.
[51] In the alternative, the AIPA submits that there is another available construction of the AFAP’s rules. It is that the persons who must be given notice are the members of the Convention 42 days in advance of the Convention. The members of the Convention who received notice are those who are entitled to vote in the Convention. As Captain Gravitis and Captain Baynham were not members of the Convention 42 days in advance of the Convention, they were not entitled to vote. As a consequence, because the resolution was only passed by one vote, it is submitted that the AFAP cannot satisfy the Commission that it was a validly passed resolution.
[52] As to proxies, the AIPA submits that Captain Pole’s second statement indicates that only 29 of the 38 Convention members attended in person with nine submitting an apology and appointing proxies. The “Voting Strength” of the various councils is set out in the minutes under agenda item 8. The table in those minutes identifies who purported to hold proxies for those absent.
[53] The AIPA submits that rule 1.12 of the AFAP’s rules provides that representation of all members at duly convened meetings is expected and makes it clear that proxies shall be used only in a manner specifically provided for in the Constitution.This is a presumption in favour of attendance. The AIPA further submits that, for the purpose of Convention, rule 7.5 of the AFAP’s rules provides for proxies in limited circumstances and once certain preconditions are met. Rule 7.5 provides:
(a) At any Convention it is desirable that proper representation is accomplished in accordance with these Rules.
Proxies may be issued only for good and sufficient cause. E.g.
(i) a member's incapacity to attend as a result of illness;
(ii) a member's family illness or bereavement;
(iii) a member absent from home on vacation;
(iv) a member absent from home on duty who was unable to be relieved from that duty.
(b) Each proxy must be in writing addressed to the President and shall state the cause of the elected representative's non-attendance.
(c) All proxies at Convention shall be declared at the first Agenda Item after the opening of the Convention and subsequently on each day of the Convention.
(d) The President shall on presentation of proxies check each one and ensure that it complies absolutely with the intent of this rule.
(e) The President shall rule as to the validity of a proxy, but his ruling shall be subject to ratification by the Convention.
(f) Details of all proxies held shall be duly recorded in the Convention Minutes of each day.
[54] The AIPA submits that Captain Pole failed to provide any evidence as to the reason proxies were issued for the purpose of rule 7.5(a). No evidence was provided of each proxy being in writing addressed to the President stating the cause of the non-attendance. As to paragraph 7.5(c), the minutes record that proxies were declared as the second agenda item on 19 October 2018. No evidence is given of the President checking the proxies under rule 7.5(d). As to rule 7.5(e), no evidence was given of any ruling by the President, and the minutes do not record any ratification of any ruling by the President on proxies by the Convention. Rule 7.5(f) requires the minutes to record the details of the proxies. The minutes only record the names of those for whom proxies were issued.
[55] The TWU supports the submissions made by the AIPA.
Qantas’s submissions re non-compliance with the AFAP’s rules
[56] Qantas submits that the AFAP has not adduced any evidence as to the steps taken by the President of the AFAP in compliance with the requirements of rule 7.5 of the AFAP’s rules concerning proxies. In these circumstances, Qantas submits that the Commission cannot be satisfied that the proxies were valid and that, consequently, the vote which occurred at the Convention on 19 October 2018 was in accordance with the AFAP’s rules.
AFAP’s submissions re non-compliance with its rules
[57] The AFAP submits that the AIPA and Qantas raised new technical objections in relation to the s 158(2) requirement after the close of the parties’ cases, and did not give notice of their intention to raise such objections in accordance with the Regulations.
[58] As to the contention that Captain Gravitis did not receive notice of the meeting 42 days before the Convention, as required by rule 7.3(c), the AFAP submits that there are two problems with this submission. The first is that what s 158(2) requires is compliance with the rule concerning constitutional amendments, which is rule 1.14. That rule does not require 42 days’ notice of meeting. In support of this argument, the AFAP relies on the Australian Rail, Tram and Bus Industry Union 33 and AEU v Australian Principals’ Federation34. In the RTBU case, it was held that s 158(2) did not require compliance with notice requirements appearing outside of the rule-amendment provision of the RTBU’s rules. Secondly, the AFAP submits that even if compliance with rule 7.3(c) was required for s 158(2), rule 7.3(c) can only require notification of persons who are Convention members as at the notification date to be given notice of meeting. Captain Gravitis was not a Convention member on that date, and did not need to be notified. The suggestion that the AFAP should have anticipated or guessed that he might later become a Convention member and notified him on that basis, is, so the AFAP submits, absurd.
[59] As to the AIPA’s alternative argument to the effect that since Captain Gravitis joined the Convention after the meeting notification date, he was not entitled to vote, the AFAP submits that the AIPA does not refer to any rule to support this argument and it is directly inconsistent with rules 7.1, 7.8(a) and 1.14(b), which regulate who may vote at Convention, and make no exclusion for persons not given 42 days’ notice of meetings.
[60] As to the AIPA’s submissions concerning Captain Baynham and the giving of 42 days’ notice of the Convention meeting, the AFAP contends that, in their opening submission, the AIPA made no mention of Captain Baynham and did not put her in issue, and so Captain Pole did not initially give any evidence about when she received the various notices. In those circumstances, the AFAP submits it would be procedurally unfair for the Commission to entertain any submission about Captain Baynham. Secondly, in any event, it is submitted that the evidence which is before the Commission shows that Captain Baynham was in the same position as Captain Gravitis: she joined the Convention on 5 October 2018, well after the deadline under rule 7.3(c) for giving notice of meeting. As such, if the Commission is to entertain any challenge based on her not receiving the notice of meeting, it must be dismissed.
[61] The AFAP also submits that it is clear from the third witness statement of Captain Pole dated 7 December 2020 35 that Captain Baynham received both the notice and working paper in the time provided by the AFAP’s rules.
[62] The AFAP submits that the challenge to the proxies is a new objection, not raised in the AIPA or Qantas’s opening submission. It has never been “put in issue”, and so the AFAP should not be expected to respond to it now. It is submitted that the Commission should not entertain the submission. In any event, the AFAP submits that the challenge has no merit because:
(a) proxy-checking is not required by rule 1.14 itself;
(b) compliance with proxy-checking rules, etc, is not required under s 158(2), as these are entirely peripheral to the rule change with which s 158(2) is concerned; and
(c) the only question of substance relating to proxies which is conceivably connected to the s 158(2) question is whether the proxies who actually voted were permitted to be cast. That must be answered in the affirmative. Under rule 7.5(e), the Convention as a whole ultimately decides and ratifies which proxies are to be accepted. It is clear from Captain Pole’s evidence that the Convention accepted all of the proxies notified.
Consideration of compliance with AFAP’s rules
[63] Section 158(2) of the RO Act requires satisfaction that the rule change has been made “under the rules of the organisation”.
[64] In Australian Principals Federation, 36 a Full Bench of the Australian Industrial Relations Commission considered an appeal from a decision of Vice President Ross (as his Honour then was) in which the Vice President granted registration of the Australian Principals Federation as an organisation of employees under Schedule 1B of the Workplace Relations Act 1996 (Cth), s 19(1)(h) of which required, inter alia, that a majority of members had “passed, under the rules of the association, a resolution in favour of registration of the association as an organisation”. The Full Bench relevantly held (at [61] and following) as follows:
“It seems to us that the expression “under the rules of the association” in s 19(1)(h) in relation to the passing of a resolution, requires no more and no less than that the resolution has been passed in conformity with such of the rules of the association as are, on their face, directly concerned with the passage of resolutions by the committee of management. In our view it does not permit a collateral challenge based on breaches of other rules of the association at a time far removed from the passage of the resolution in question.
Specifically, in our view, s 19(1)(h) does not permit a challenge in the form of an attack on the validity of the status of persons who are said to form the committee of management where the evidence suggests that those persons have been accepted as valid members of the association and as members of the committee of management and the breaches said to impugn their status as members of the association or the committee of management occurred at a time far removed from the passage of the resolution in question.
We will shortly turn in greater detail to our reasons for reaching this conclusion, however it seems to us that when s 19(1)(h) is construed in the context of s 19(1), the RAO Schedule and WR Act as a whole (and the predecessors to s 19(1)(h) viewed in the context of the legislation as it then stood) the intent of the Parliament in enacting s 19(1)(h) and its predecessors was to ensure that applications for registration could not be lodged by some official engaged in a frolic of his or her own or by a minority group of members or officials against the wishes of the majority. They are to be made only pursuant to a considered decision of the association or its committee of management. In our view, the Parliament did not intend to authorise an objector to undertake the sort of attack made by the AEU in the present case.
The rules of the APF contain only two rules that directly relate to the passage of resolutions by the committee of management, namely rules 30 and 31:
30. Voting
(a) Voting at all meeting of Council and Executive and general meetings of members shall be by show of hands, except as Council shall decide otherwise.
(b) In the event that a member of Council or Executive being for any reason or at any time unable to be present at any meeting of the same or unable to exercise his/her vote as a delegate under these rules;
(i) he/she may appoint in writing another member of Council or Executive as the case may be as his/her proxy to exercise his/her vote at such meeting;
(ii) at meetings of Council and Executive, the Chairperson shall have the deliberative and casting vote.
31. Quorums
The quorum for any meeting of Council or Executive shall be one half of the persons entitled to attend and vote, provided that at least one member of both sectors is present.
…
There is no appellate authority in which the nature of the requirement imposed by s 19(1) has been directly considered or which clearly supports the strict, technical approach of the AEU based on alleged breaches of the rules at a time far removed from the purported resolution in favour of registration…
…
We think that a confined construction of the requirement in s 19(1)(h) that we have adopted is to be preferred to the broad and strict operation of s 19(1)(h) for which the AEU contends for the following reasons:
(a) The confined approach we have adopted is more consistent with the scheme of the Act;
(b) The AEU’s approach is apt to lead to an outcome that is inconsistent with practical reality and first principles in relation to unincorporated associations; and
(c) The approach urged by the AEU increases the potential for embarrassment arising from the same factual situation giving rise to different outcomes in the Commission and the Courts.”
[65] The requirement to be satisfied, in accordance with s 19(1)(h) of the Workplace Relations Act, that a majority of members had “passed, under the rules of the association, a resolution in favour of registration of the association as an organisation” is similar to the requirement in s 158(2) of the RO Act that a rule change “has been made under the rules of the organisation”. The reasons given by the Full Bench in Australian Principals Federation for its interpretation of the expression “under the rules of the association” in s 19(1)(h) of the Workplace Relations Act are, in my opinion, broadly applicable to s 158(2) of the RO Act.
[66] In my view, the expression “under the rules of the organisation” in s 158(2) of the RO Act requires that the rule change has been made in conformity with such of the rules of the organisation as are, on their face, directly concerned with the amendment of the organisation’s rules. This construction is consistent with that adopted by the Full Bench in Australian Principals Federation, in connection with a provision similar to s 158(2) of the RO Act. Further, this construction of s 158(2) is supported by the express requirement in the provision that the rule change must be made “under the rules of the organisation”. That necessarily focuses attention on the rules of the organisation which govern any amendment to those rules. Section 158(2) does not require that some other act or event which has a connection to the proposal to change the organisation’s rules takes place in accordance with the rules of the organisation.
[67] Rule 1.14 governs amendments to the AFAP’s rules. It relevantly provides:
“(a) The … Rules of the Federation shall not be altered, amended, added to, or replaced, except by resolution of the Convention.
(b) Not less than twenty one days’ notice in writing of any proposed alteration, amendment, addition to or repeal of the … Rules of the Federation shall be given to all Council Committees and no such alteration, amendment, addition or repeal shall be effective unless a majority representing at least two thirds of the total votes available to all Councils and Officers present and entitled to vote at Convention, including any proxies held, cast a vote in favour of the alteration, amendment, addition or repeal.”
[68] It is apparent from rule 1.14 of the AFAP’s rules that it contains rules of the organisation which are, on their face, directly concerned with the amendment of the organisation’s rules. Rule 1.14 requires that:
• the AFAP’s rules can only be changed by resolution of the Convention;
• 21 days’ written notice of the proposed change to the rules must be given to all Council Committees; and
• a majority representing at least two thirds of the total votes available to all Councils and Officers present and entitled to vote at the Convention, including any proxies held, must vote in favour of the rule change.
[69] The requirements imposed by rule 1.14 may give rise to questions or issues in particular cases. For example, there may be a factual issue in a particular case as to whether particular proxies were “held” within the meaning of rule 1.14(b). In another case there may be an issue as to whether there was a “resolution of the Convention” within the meaning of rule 1.14(a). That may, in turn, give rise to a question as to whether there was a quorum for the Convention, as required by rule 7(a) of the AFAP’s rules. If there was not such a quorum present, rule 7(b) of the AFAP’s rules provides that “the Convention shall lapse”. In those circumstances, there could not have been a “resolution of the Convention” within the meaning of rule 1.14(a) because the Convention lapsed.
[70] Rule 1.14 of the AFAP’s rules imposes its own notice requirements to ensure appropriate persons are given adequate notice of any proposal to change the rules of the organisation. Rule 1.14 does not impose additional requirements that members of the Convention must be given at least 42 days’ notice of an annual convention or that, at least 21 days before the Convention sits, all relevant final working papers must be distributed to Convention delegates. Those requirements are imposed by rule 7.3 of the AFAP’s rules, which deals with meetings and notice of meetings for Conventions. Rule 7.3 is not directly concerned with the amendment of the organisation’s rules.
[71] Similarly, although rule 1.14 requires that any proxies be “held”, it does not impose technical requirements for the checking, etc, of proxies by the President, such as those imposed by rule 7.5 of the AFAP’s rules. Rule 7.5 is not directly concerned with the amendment of the organisation’s rules. I accept the AFAP’s submission that compliance with proxy-checking rules, etc, is not required under s 158(2) of the RO Act, as these are entirely peripheral to the rule change with which s 158(2) is concerned.
[72] I am satisfied on the basis of the evidence given by Captain Pole that the requirements set out in paragraph [68] above were met in relation to the proposal to amend rule 2.1 of the AFAP’s rules. In particular:
• a Convention (with the requisite quorum) was held on 19 October 2018;
• 21 days’ written notice of the proposed change to rule 2.1 of the AFAP’s rules was given to all Council Committees; and
• at the Convention on 19 October 2018 a majority representing at least two thirds of the total votes available to all Councils and Officers present and entitled to vote at the Convention voted in favour of the proposed change to rule 2.1 of the AFAP’s rules (22 voted in favour and 10 voted against the rule change proposal. 22/32 = 68.75%). The votes in favour of the proposed rule change included nine proxies held on behalf of persons entitled to vote, including Captain Baynham and Captain Gravitas. The nine proxies were permitted to be cast.
[73] It follows that I am satisfied that the change to rule 2.1 of the AFAP’s rules was made “under” the AFAP’s rules within the meaning of s 158(2) of the RO Act.
[74] In the event that I am wrong in my conclusion as to what is required in order to comply with s 158(2) of the RO Act and compliance with the technical requirements imposed by rules 7.3(c) and 7.5 of the AFAP’s rules was necessary for the rule change to have “been made under the rules of the organisation” within the meaning of s 158(2), I make the following observations and findings:
(a) Regardless of whether any objection or submission has been made in relation to compliance with the AFAP’s rules, I am required by s 158(2) of the RO Act to be satisfied that the rule change has been made under the rules of the organisation.
(b) Rule 7.3(c) of the AFAP’s rules requires that “Members of the Convention including the duly elected Council Committee Representatives, Federal Officers and others nominated to be in attendance (as provided under clause 1 of this rule) shall be notified in writing a minimum of 42 days in advance of such Annual Convention. Notification shall clearly specify the time of commencement, the venue, the schedule to be followed and a preliminary agenda”. It is clear from this rule that the obligation to provide at least 42 days’ notice of the Convention only applies to persons who were “Members of the Convention including the duly elected Council Committee Representatives, Federal Officers and others nominated to be in attendance” at the time the notice was required to be given. There is no dispute that Captain Gravitas and Captain Baynham were not Convention members at the time the notice was required to be given under rule 7.3(c). Accordingly, there was no obligation to provide Captain Gravitas or Captain Baynham with at least 42 days’ written notice of the Convention pursuant to rule 7.3(c) of the AFAP’s rules.
(c) I do not accept the AIPA’s alternative argument that only members of the Convention who received at least 42 days’ written notice of the Convention were entitled to vote at the Convention on 19 October 2018, with the result that Captain Gravitis and Captain Baynham were not entitled to vote because they were not members of the Convention 42 days in advance of the Convention. This contention is inconsistent with rules 7.1, 7.8(a), 7.8(d) and 1.14(b) of the AFAP’s rules, which regulate who may vote at Convention, and make no exclusion for persons not given 42 days’ notice of meetings. It is notable that rule 7.8(d) expressly states that “voting at Conventions shall be carried out exclusively by the duly elected representatives of the Council Committee or their proxy”.
(d) On 5 October 2018 Rohan Smith resigned as Chair of AFAP’s Cobham Council. The Cobham Council appointed the Vice Chair, Rohan Ward, to replace him, and appointed Captain Baynham as Vice Chair. Accordingly, Captain Baynham became a Convention member on 5 October 2018. Notwithstanding that she was not a Convention member on 25 July 2018, Captain Baynham attended an Executive meeting of the AFAP on 25 July 2018 as a proxy holder. At that meeting Captain Baynham was given a copy of a publication which provided written notice of the Convention to be held on 19 October 2018. The publication included the time of commencement, the venue, the schedule to be followed and a preliminary agenda for the Convention. In addition, written notice of the Convention was emailed to Captain Baynham on 13 August 2018, and posted to her on 23 August 2018. The working papers, containing the proposal to amend rule 2.1 of the AFAP’s rules, were sent to Captain Baynham by post on 24 September 2018, and by email on 25 September 2018. Captain Baynham attended the National Convention meeting on 19 October 2018 and voted on the proposal to amend rule 2.1 of the AFAP’s rules.
(e) On 24 September 2018 the working papers for the Convention, containing the proposal to amend rule 2.1 of the AFAP’s rules, were posted to all 38 Convention members, and also all council committee members including Captain Gravitas. On 25 September 2018 the working papers for the Convention, containing the proposal to amend rule 2.1 of the AFAP’s rules, were emailed to all 38 Convention members, and also all council committee members including Captain Gravitas. On 2 October 2018 Captain Gravitas replaced Mark Bennett as Vice Chair of AFAP’s Rex Council and, as such, became a Convention member. On 2 October 2018 Captain Gravitas was sent written notice of the Convention, by email and post. On the morning of the National Convention meeting on 19 October 2018, Captain Gravitas submitted an apology and appointed Robin Darroch as his proxy. Robin Darroch attended the National Convention meeting on 19 October 2018 and voted, by way of proxy, on behalf of Captain Gravitas on the proposal to amend rule 2.1 of the AFAP’s rules.
(f) Although Captain Pole asserted in her first witness statement that the alteration to rule 2.1 was made in accordance with the AFAP’s rules, the evidence does not disclose whether each or any of the nine proxies issued in relation to the Convention on 19 October 2018 met the technical requirements of rule 7.5 of the AFAP’s rules, such as whether each proxy was in writing addressed to the President and stated the cause of the elected representative’s non-attendance, whether the President checked each proxy, whether the President made a ruling as to the validity of each proxy, or whether any ruling made by the President in relation to one or more proxies was ratified by the Convention. I am, however, satisfied on the evidence that the nine proxies issued in relation to the Convention on 19 October 2018 were issued by members of the Convention, were permitted to be cast, were accepted by the Convention, and were included in the vote for the proposal to amend rule 2.1 of the AFAP’s rules.
Identifying the relevant class of persons
[75] In order to identify the class of persons who would be eligible for membership because of the alteration, it is necessary to compare the existing coverage of the organisation with the coverage it would have if the Commission were to consent to the proposed rule alteration.
The differing contentions as to the class
[76] There is no dispute that the class of persons who would be eligible for membership of the AFAP because of the rule alteration includes part time pilots and pilots engaged as independent contractors. The AIPA also submits that the class would include persons “seeking to be employed as a pilot”. The AFAP rejects that contention.
[77] There are three different contentions before the Commission regarding the extent of AFAP’s coverage of Qantas pilots under its rules prior to the proposed amendment:
(a) the AFAP contends that it can presently cover Qantas’s domestic pilots, but not its international pilots, so that the class in issue in this case covers only Qantas’s international pilots;
(b) the AIPA contends that the AFAP can cover neither Qantas’s domestic nor international pilots, so that the class in issue covers all Qantas pilots; and
(c) Qantas contends that the relevant class of persons are the Qantas mainline pilots which are comprised principally of the international or long haul pilots. Qantas does not concede that the AFAP is eligible to cover its domestic pilots.
[78] The parties accept that this issue is to be determined by the proper construction of the AFAP’s current eligibility rules, particularly rule 2.1(a). Rule 2 is set out in paragraph [4] above.
Principles as to the construction of union rules
[79] The proper approach to the interpretation of union rules was summarised by the Full Bench in AMWU v Resmed Limited 37 as follows (references omitted):
“(1) Union eligibility rules will be construed objectively.
(2) The nature of union eligibility rules means that they should be construed liberally rather than narrowly or technically.
(3) It is permissible to have regard to any common understanding among people concerned with relevant industries and particularly with industrial matters of the ordinary application of the words used, and to the previous use of the words in the relevant organisation’s rules and in statutory provisions, decisions, determinations, awards, reports and other papers concerned with the relevant industry or industries. Federal awards, including consent awards, made by Commonwealth industrial tribunals at a time when the legislative award-making power was founded upon the industrial disputes power in s.51(xxxv) of the Constitution, are important sources in this respect since a union may only be a party to an industrial dispute involving employees eligible to be its members.
(4) If there is ambiguity as to the meaning of words in the eligibility rules, assistance may be sought in the terms of the industry rule (subject to it being understood that the scope of the eligibility rule is not restricted by the scope of the industry rule).
(5) Words in an eligibility rule should not be read in isolation such as to give the rule a wide and indefinite scope of operation that is unlikely to have been intended.
(6) Terms used in union eligibility rules should not be interpreted statically in accordance with the meaning they bore at the time that they were first introduced into the rules. Although such terms will have a fixed connotation, they bear a changing denotation - that is, they may be interpreted in accordance with their appropriate current meaning, taking into account changing technologies and methods of work. This may mean that eligibility rules may cover industries or callings not known when the rules were originally drafted.
(7) The words “in or in connection with” are words of expansion. However, for the requisite connection to be established, the work of the employees in question must be referable or significant to the work of the second group of employees with whom there is said to be a connection. It is not sufficient that the work of the relevant employees makes it possible for an employer to conduct a business involving the performance of work by the second group of employees.”
[80] Further to principles (1) and (2) in the previous paragraph, while union rules are to be construed objectively, a liberal and purposive approach should be taken to the construction of the rules. 38
Consideration re short haul and long haul pilots
[81] The part of rule 2.1(a) of the AFAP’s rules which requires consideration to determine the scope of the disputed class is as follows:
“… a person normally employed as a pilot on regular public transport airline services extending beyond the Commonwealth of Australia operated by an Australian airline principally engaged in providing international regular public transport airline services …”
[82] There is no dispute and I accept on the evidence that Qantas is “an Australian airline principally engaged in providing international regular public transport airline services”. Accordingly, the question is whether a Qantas pilot is “a person normally employed as a pilot on regular public transport airline services extending beyond the Commonwealth of Australia operated by” Qantas. In my view, this part of the rule is ambiguous because it is susceptible to different interpretations. First, the adverb “normally” may be construed to only relate to the person’s employment as a pilot. Secondly, the adverb “normally” may apply to the composite expression “employed as a pilot on regular public transport airline services extending beyond the Commonwealth of Australia …”, so that it is relevant to inquire as to whether the pilot normally conducts an airline service extending beyond the Commonwealth of Australia. Even if the first of these constructions is preferred, it remains necessary to determine whether the person normally employed as a pilot is employed “on regular public transport airline services extending beyond the Commonwealth of Australia”. The word “on” in this context means “membership or association”. By way of illustration, a person may be employed “on the staff of a newspaper”. 39 The adjective “regular” qualifies the airline services under consideration, not the person’s employment on those services. Hence the question is whether the pilot is employed on public transport airline services extending beyond the Commonwealth of Australia, and if so, are those services “regular”. In this context, the ordinary meaning of regular is “recurring at fixed times; periodic”.40
[293] The AFAP is well placed to offer competition and choice for pilots in the Class, in that the evidence establishes that the AFAP is a well-run and effective pilots’ union. I do not accept the contention that Qantas pilots already have available to them a choice to join another effective union for pilots, namely the TWU. I accept Captain Bevan’s evidence that (a) the TWU does not have any international pilot members employed at Qantas, (b) he has never competed with the TWU, (c) he has not seen the TWU actively entering bargaining or the like, and (d) he is not aware of the TWU having had any involvement with pilots in the Class. There is no evidence of the TWU’s resources, staffing, structures or capacity to represent pilots in the Class, save for Mr Lutton’s estimation that the TWU has about 20 member pilots employed by Qantas and the total number of TWU pilot members to be less than 200. 60
[294] I accept the hearsay evidence given by Mr Lutton 61 and Captain Bollen62 that there are a number of Qantas pilots who would join the AFAP if the AFAP had coverage over Qantas pilots. This evidence is supported by the fact that about 65 members of the AFAP have elected to remain members of the AFAP since they were recruited by Qantas from other Qantas group airlines.
[295] On the basis of the evidence adduced in these proceedings, I do not accept the AFAP’s contention that there is any significant dissatisfaction among AIPA’s members with the leadership of the AIPA. First, there has been no material exodus of members from the AIPA to the TWU or to become union-free employees. In the period from 19 March 2020 to 12 November 2020, there were 12 resignations from the AIPA. The reasons for their resignations included financial difficulties, retirements, leave without pay, as well as five pilots who were disappointed with the AIPA’s response to Qantas’s actions during the pandemic, particularly Qantas’s decision not to offer voluntary redundancy to pilots aged 63 and over. In the same period (19 March 2020 to 12 November 2020), the AIPA gained 17 new pilot members in Qantas mainline. 63 Secondly, there will always be different views amongst a large group of educated members, such as pilots who are members of the AIPA, in relation to matters such as bargaining strategy. In that context, it is not surprising that a relatively small group (33) of AIPA members called for a Special General Meeting in relation to the AIPA’s bargaining with Qantas and Captain Smith proposed motions seeking to ensure that members received information about bargaining from persons other than Executive members. In addition, I am not persuaded on the evidence that the fact that a recent “change ticket” won 15 out of 20 seats on the AIPA Committee of Management demonstrates any significant dissatisfaction with the AIPA leadership or poor performance on the part of the AIPA leadership team. The evidence establishes that the AIPA has been successful, over a long period of time, in negotiating “gold standard” enterprise agreements (from the perspective of employees) with Qantas and working with Qantas in a cooperative and effective manner for the benefit of both Qantas pilots and Qantas.
[296] The existence of a desire on the part of at least some Qantas pilots to join the AFAP - a well-run and effective pilots’ union - coupled with the benefits which competition and choice will provide to Qantas pilots, are discretionary factors which weigh in favour of consenting to the proposed rule change.
Effect on the AIPA
[297] The AIPA contends that allowing the application will cause it to have an “existential crisis”. I do not accept that contention. The AIPA has just over 90% of Qantas pilots as members. Any Qantas pilot who joins the AFAP is likely to be a pilot who has ceased their membership of the AIPA in order to join the AFAP. It follows that consenting to the AFAP’s application will almost certainly reduce the number of Qantas pilots the AIPA has as members and thereby decrease its revenue. However, the AIPA is an effective and experienced pilots’ union, and it is likely to retain many Qantas members; its extinction is unlikely. To that end, Captain Bevan gave evidence, which I accept, that he believed the AIPA “would be able to compete quite well” with the AFAP. 64
Effect on pilot collective power
[298] It is contended that consenting to the application would diminish Qantas’s international pilots’ collective power, to their detriment. I do not accept this argument. The entry of the AFAP into the market for Qantas pilots as members is not likely, in my view, to reduce the collective power of the unionised pilots. I have formed that opinion for the following reasons.
[299] First, the AFAP has over 90% coverage in both Eastern and Sunstate. 65 Both the AIPA and the TWU also have member pilots employed by Eastern and Sunstate.66 At the time the AIPA Rules Case was heard by SDP Kaufman in 2007, the AFAP had 82% coverage of pilots in Eastern and 90% coverage of pilots in Sunstate.67 It is apparent from this analysis that following the amendment to the AIPA’s rules to permit it to have member pilots employed by Qantas group airlines such as Eastern and Sunstate, union density increased at Eastern and remained roughly the same at Sunstate. As was the case in Sunstate and Eastern, I consider it likely that union density among Qantas pilots will remain fairly constant, and is unlikely to decrease by any significant number, if the AFAP’s rules are amended to permit it to have Qantas pilots as members. Maintaining a high level of union density usually results in strong collective power for the unionised group of employees.
[300] Secondly, the existence of a second active union, the AFAP, for Qantas pilots is unlikely to reduce the collective power of the unionised pilots. To the contrary, I am of the opinion that the introduction of an active, well-resourced pilots’ union with extensive industry-wide experience (the AFAP) for Qantas pilots to join will increase the collective power of unionised pilots at Qantas. The AFAP will be able to bring its extensive experience from across the aviation sector to the table, in conjunction with the deep experience the AIPA has in negotiating and dealing with Qantas, to enhance the collective power of unionised pilots at Qantas.
[301] Thirdly, I accept it is possible that there could be disputation between the AIPA and the AFAP which may diminish the collective power of the unionised pilots at Qantas. There is also the prospect that Qantas could seek to “play off” one union against the other and thereby diminish the collective power of the whole group of unionised pilots at Qantas. However, I do not consider that either of those outcomes is likely. Ultimately those pilots, as members of the AIPA or AFAP (or the TWU), will be keen to ensure that their unions act in their best interests and do not permit any disputes between the unions or tactics adopted by Qantas to cause them any material detriment. Any union leader who puts their own self-interest or the interests of their union over the interests of the members they represent, particularly educated, experienced and long-term union members such as most of the Qantas pilots, is likely to be removed from office or not have their proposals endorsed by the governing bodies within the union. Further, the AFAP and the AIPA have proven themselves to be able to work together constructively, and without damaging disputation, at Jetstar and other Qantas group airlines, for many years. On the two occasions over the last 13 years in which there has been a disagreement between the two unions, the differences have not resulted in any material damage. Both organisations were able to move on from the disagreements and focus on their task of acting in the best interests of their members. It is also relevant that the AFAP is by no means a militant union which cannot tolerate competition or co-existence with other unions; it has worked peaceably with VIPA and the TWU for a number of years.
Harm to pilot conditions
[302] The AIPA submits that granting this application would harm pilots’ enjoyment of their conditions under the Current Long Haul Agreement (as committees become unworkable, etc) and raise the serious prospect that pilot conditions will be lost in the next enterprise agreement, or the one after that. I do not accept that either of these things is likely to occur. The AIPA’s rights under the Current Long Haul Agreement to have its nominees sit on various committees and make various decisions will not change by reason of an amendment to the AFAP’s rules. Those exclusive rights will remain in place for at least so long as the Current Long Haul Agreement remains in operation. I have already expressed the opinion that it is very difficult to speculate on what will happen in the next round of bargaining negotiations, or the one after that. I am, however, confident that Qantas’s pilots will be keen to ensure that the rights and protections they have bargained for over a significant period of time are not diminished in future rounds of bargaining.
AIPA’s arguments re objects of the FW Act and the RO Act
[303] The AIPA submits that if the application is granted, it will remain opposed to the conferral on the AFAP of the rights the AIPA currently enjoys under the Qantas enterprise agreements, but will comply with the requirements of the FW Act about the bargaining process. As a consequence, it is contended that the AFAP will remain in its less important subsidiary position. This will lead, so the AIPA submits, to the establishment of a two tier system of employment within Qantas – with one organisation and its members having a superior set of rights. The AIPA submits that one of the matters relevant to the general discretion is the purpose of enhancing relations within workplaces between federal system employers and federal system employees. The purposes of the federal scheme (s 3 of the FW Act) include providing a framework for cooperative and productive workplace relations and achieving productivity and fairness through an emphasis on enterprise level collective bargaining. The AIPA contends that the establishment of a two tier system would not promote fairness.
[304] It is correct that the AFAP will not have the same rights as the AIPA has under the current enterprise agreements at Qantas, for at least so long as those enterprise agreements remain in operation. Whether the AIPA will be able to retain all of its exclusive rights in the next round of bargaining, or the one after that, is too speculative to assess for the reasons discussed above. But even assuming that the AIPA will retain all of its exclusive rights for a considerable period of time, I do not accept that consenting to the AFAP’s application would be contrary to, or inconsistent with, the objects of the FW Act or the RO Act. The overall objective of the FW Act is to “provide a balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians”. 68 One of the ways this objective may be met is by “achieving productivity and fairness through an emphasis on enterprise-level collective bargaining underpinned by simple good faith bargaining obligations and clear rules governing industrial action”.69 For the reasons already given, I do not consider that the continuation of the AIPA’s exclusive rights under the applicable enterprise agreements at Qantas will be likely to have any material impact on the provision of a balanced framework for cooperative and productive workplace relations at Qantas’s workplace. Further, all Qantas pilots have a shared interest in maintaining and improving the conditions under which they perform work. I am confident that both the AIPA and the AFAP will act in the best interests of their members to achieve this shared interest, including by acting in a cooperative and productive manner. I am also confident that there will continue to be an emphasis on enterprise-level collective bargaining, underpinned by the parties’ respective good faith bargaining obligations, at Qantas, with the objective of achieving productivity and fairness for all parties concerned.
[305] The AIPA also submits that one of the matters relevant to the general discretion is that Parliament “recognises and respects the role of employee organisations in facilitating the operation of the workplace relations system”. 70 That is the system established by the FW Act. The AIPA contends that the role of an organisation under the system established by the FW Act includes entering into and enforcing enterprise agreements and the benefits in them, thereby enhancing employment conditions of employees and ensuring that they are enjoyed. The AIPA contends that establishing a system in which the AFAP is reduced by operation of the enmeshment provisions to a subordinate role is contrary to that object. I do not accept this argument. The AFAP will be a bargaining representative for its members in the next round of bargaining relating to the Current Short Haul Agreement and the Current Long Haul Agreement. The fact that the AFAP does not currently have the exclusive rights and duties conferred and imposed on the AIPA by those current agreements will not change the status of the AFAP as a bargaining representative in the next round of bargaining, nor will it, in my opinion, have any material impact on the effectiveness of the AFAP as either a bargaining representative for its members or as a representative of one or more members seeking to ensure the benefits of the current enterprise agreements are enjoyed by pursuing a claim for an unpaid entitlement under those instruments.
[306] Parliament’s intention in enacting the RO Act was to “enhance relations within workplaces between federal system employers and federal system employees and to reduce the adverse effects of industrial disputation”. 71 For the reasons already given, I do not believe that consenting to the AFAP’s proposed rule change will give rise to any material increase or decrease in industrial disputation at Qantas. As to enhancing relations between Qantas and its pilots, giving those pilots who wish to join the AFAP the ability to do so will, in my view:
• enhance the relations between those pilots and Qantas, because they will be represented by an experienced and effective union of their choice; and
• not have a material impact on the relations between the pilots who remain members of the AIPA, another experienced and effective pilots’ union, and Qantas, or the relations between the (relatively few) non-union Qantas pilots and Qantas.
Assumptions as to coverage of Qantas pilots
[307] A relevant discretionary consideration is whether the application should be refused because it will upset the AIPA’s assumption, following the demarcation orders made by SDP Hancock in 1995 and 1996, that the AFAP would not ever enter, or seek to enter, Qantas’s business, whether in domestic or international flying.
[308] I am not persuaded by the evidence that the AIPA has suffered any material detriment by reason of its assumption that the AFAP would remain out of Qantas’s business. The absence of any such material detriment tells against giving this factor any significant weight.
Has the AFAP been “lazy”?
[309] The AIPA submits that the AFAP’s “laziness” in not actively enrolling Qantas domestic pilots weighs against the exercise of a discretion to consent to the proposed rule change.
[310] For the reasons given in paragraph [275] above, I have found that it was reasonable in the circumstances for the AFAP to wait until this application is heard and determined by the Commission before recruiting Qantas pilots as members. I therefore do not accept that the AFAP has been “lazy” in not actively enrolling or representing Qantas pilots. I consider this to be a neutral consideration.
Disadvantages for Qantas
[311] Qantas contends that amending the AFAP’s rules to permit it to have Qantas pilots as members would mean that Qantas would have to consult with an additional union, thereby introducing complexity in its business and slowing down its decision making. I do not accept that this weighs against exercising a discretion to consent to the AFAP’s proposed change to its rules.
[312] First, in respect of matters where the AFAP is obliged to consult with both the AFAP and the AIPA because, for example, members of both organisations are affected by a proposal or decision which Qantas wishes to make, Qantas may be able to organise a consultation meeting at which representatives of both the AFAP and the AIPA can attend. If such a joint consultation meeting cannot be organised, holding separate consultation meetings with each of the AFAP and the AIPA is unlikely to cause a significant delay to the making of a decision by Qantas.
[313] Secondly, Qantas is a large and well-resourced organisation. It will, no doubt, have the resources required to ensure that consultation meetings are organised and held within reasonable periods of time, so that decisions can be made in a timely manner. Mr Alley did not suggest that holding additional consultation meetings with the AFAP would be incompatible with Qantas running a profitable business.
[314] Thirdly, having regard to the focus in the FW Act on freedom of association, I agree with the AFAP’s submission that the Commission should be slow to accept disadvantage to an employer as a proper basis for rejecting an application to amend an organisation’s rules under s 158. I accept that there may be cases where the impact of the rule alteration is likely to be so significant to one or more employers that it may justify exercising a discretion to refuse a proposed rule alteration. This is not such a case.
[315] Relatedly, the AIPA submits, and I accept for the most part, that it has a close, cooperative, trusting, open and effective working relationship with Qantas. Interfering with this model is not, so the AIPA contends, in the interests of Qantas, its employees, or in the public interest. I do not accept that permitting the AFAP to amend its rules so that it can have Qantas pilots join as members will have a material impact on the relationship between the AIPA and Qantas, nor will it have a material negative impact on the interests of Qantas, its pilots, or the public. History supports this view. There is no suggestion in the evidence that (a) allowing the AIPA to amend its rules in 2007 to have pilots from Qantas group airlines join the AIPA or (b) permitting VIPA to compete with the AFAP for Virgin’s pilots as members had any material negative impact on the relevant employers, their pilots, or the public.
The impact of COVID-19
[316] The AIPA and Qantas submit that the COVID-19 pandemic has had a colossal impact on Qantas’s business and its pilots. They say that Qantas’s international operations have been reduced to a small number of freight and repatriation flights; domestic flights remain at a fraction of normal levels; the entire fleet of Qantas’s A380s have been placed in storage and are unlikely to fly for three years; 80% of short haul pilots and 95% of long haul pilots have been stood down; and announcements have been made to reduce Qantas pilot numbers by significant number. The AIPA submits that it has worked cooperatively and collaboratively with Qantas in relation to various issues associated with these significant changes. The AIPA also submits that both the AFAP and the AIPA have been detrimentally affected by the dramatic and sudden change in circumstances, including by reductions in union fees.
[317] The AIPA contends that there is uncertainty as to Qantas’s operations, both now and in the immediate future; there is a strong need for pilot representation; there is no time for competition between unions; no time for the building of new relationships with the AFAP; no time to be spent listening to a new voice with different motives; and the crucial role that the AIPA is currently playing on behalf of the whole Qantas pilot body in working with Qantas as it responds to these changes would be undermined by the granting of an application for a new player to enter the field. It is submitted that these matters are significant, and they provide a compelling basis for the Commission to dismiss the application as a matter of discretion. It is contended that granting the application at this time, or in the foreseeable future, will not promote or protect the economic and social interests of Qantas’s pilots or Qantas.
[318] Qantas submits that the difficulties and challenges presented by COVID-19 have made it critical for Qantas to be responsive and efficient in addressing the challenges, including collaborating and consulting with the AIPA in order to meet future operational challenges in a flexible and practical way. At times, this has required agreeing to variations to the processes contained in the applicable enterprise agreements. The introduction of another industrial organisation at this time will, so Qantas contends, likely give rise to further complexity and practical difficulties in communicating with, and implementing any arrangements involving, multiple industrial organisations.
[319] The AFAP makes three submissions in response to the reliance on the impact of the COVID-19 pandemic. First, the AFAP contends that it is in challenging times that the advantages of a second union choice are strongest. It is in challenging times that “two heads” are a great advantage over one. It is in resource-constrained times that “two bank accounts” are better than one. Tellingly, it is contended that there has been no evidence in the case, and no attempt to do so, to show that Virgin or Jetstar have been crippled in responding to the pandemic by having to deal with multiple unions. Secondly, in light of the principles concerning s 158 encouraging competition between unions, the AFAP submits that there is, and can be, no suggestion that that approach is to apply only in prosperous times. Indeed, since the aviation industry is a volatile one, affected by terrorist attacks, pandemics, industrial disputation, and business collapses, it may be difficult to identify when those “prosperous” times occur. Thirdly, the AFAP submits that it cannot be assumed that the pandemic will remain indefinitely; regard must be had to post-pandemic circumstances.
[320] I accept that the COVID-19 pandemic has had, and will continue to have for some material time, a significant impact on Qantas, its operations, and its pilots. I also accept that the AIPA has worked effectively and cooperatively with Qantas during the pandemic to reach agreement on a range of variations to the processes contained in the applicable enterprise agreements. I do not expect any change on these fronts if the AFAP’s rules are amended as proposed. Moreover, although the AFAP does not have any of the exclusive rights the AIPA has under the applicable enterprise agreements, and therefore does not need to consent to variations proposed by Qantas, I am confident that when Qantas needs to consult with the AFAP about potential changes or other material matters connected with the COVID-19 pandemic, or any other disrupter to the aviation industry, the AFAP will act in a timely and cooperative manner, and will not cause any significant delay to a decision which needs to be made in connection with the impact of the pandemic. My confidence on this score is based on the AFAP’s track record of communicating and working with other airlines, including in the Qantas group, in response to significant events such as COVID-19. 72 Many of those airlines have to deal with multiple unions.73 Finally, although the pandemic has reduced the revenue of the AIPA and the AFAP (because they are receiving less in union dues), the evidence demonstrates that each union should have sufficient reserves to survive the pandemic and I do not consider that consenting to, or refusing, the AFAP’s application will result in either union suffering significant financial stress.
Conclusion
[321] In all the circumstances and for the reasons set out above, I consent to the application by the AFAP to amend its rules in the manner and form proposed by it.
[322] In accordance with s 158(9) of the RO Act, the Commission’s consent to the AFAP’s application will take effect on 3 March 2021.
DEPUTY PRESIDENT
Appearances:
C Dowling SC with J Fetter, counsel, for the AFAP
M Irving QC with T Slevin, counsel, for the AIPA
B Rauf, counsel, with T Brookes, solicitor, for QANTAS
Hearing details:
2020.
Newcastle (by video conference):
3 – 4 August, 19 – 20 and 23 – 24 November, and 7 – 8 December.
Printed by authority of the Commonwealth Government Printer
<PR727263>
1 Rule 2.1(a)(i)-(iii) of the AFAP rules
2 See paragraphs [81] to [83] below
3 Rule 2.1(a) of the AFAP rules
4 Rule 2.1(a) of the AFAP rules
5 Rule 2.1(b) of the AFAP rules
6 See the eligibility rule quoted in R v Stanton; ex parte Associated Airlines Pty Ltd (1978) 141 CLR 281 at 281.
7 Print N3320
8 AIPA Rules Case[2007] AIRC 420 (AIPA Rules Case)
9 [2016] FWCFB 22 (Resmed) at [96]
10 [2014] FWC 3658 (ALAEA) at [12]-[18]
11 ResMed Limited v AMWU (No 2)[2017] FCAFC 14
12 Re CPSU (2000) 100 IR 296 (Re CPSU) at [14]-[81]
13 Re CPSU at [80]
14 Re CPSU at [81]
15 Section 3(e) of the FW Act
16 Re CPSU at [81]
17 NTEIU v CPSU (1999) 93 IR 365 at [203]
18 CPSU[2016] FWC 985 at [29]
19 Ibid; Re CPSU at [95]
20 Re CPSU at [95]
21 CPSU[2016] FWC 985 at [28]-[30]; ALAEA at [19]
22 Re AWU; Ex parte CFMEU (2002) 120 FCR 527 at [44]-[52]
23 Section 158(5) of the RO Act
24 ResMed at [123]
25 ALAEA at [64]
26 Re CPSU at [85]-[96]; ALAEA at [19]-[22]
27 Notice of Objection dated 1 July 2019 filed on behalf of the APIA
28 Notice of Objection dated 3 July 2019 filed on behalf of Qantas
29 Notice of Objection dated 26 June 2019 filed on behalf of the TWU
30 38 exhibits and 4285 paragraphs of transcript
31 [2018] FWC 2624
32 Rayner v Riley [2020] FCA 587 at [75]
33 [2020] FWC 1489 (RTBU) at [52]
34 (2006) 158 IR 360 (Australian Principals Federation) at [61] and generally
35 Ex 32
36 (2006) 158 IR 360
37 [2014] FWCFB 3501 at [34]
38 R v Cohen; Ex parte Motor Accidents Insurance Board (1979) 141 CLR 577 at 587; Co-operative Bulk Handling Ltd v Waterside Workers’ Federation of Australia (1980) 49 FLR 355 at 361-2; Electrical Trades Union of Australia v Waterside Workers’ Federation of Australia (No. 2) (1982) 59 FLR 78 at 87
39 Macquarie Dictionary, Revised Third Edition, “On … 15. membership or association; on the staff of a newspaper; to serve on a jury …”
40 Macquarie Dictionary, Revised Third Edition
41 Ansett Transport Industries (Operations) Pty Ltd & Ors v Australian Federation of Air Pilots [1991] 1 VR 637
42 Appeal against a decision of SDP Hancock (2607/1995) Print N7298 at p 29
43 Appeal against a decision of SDP Hancock (2607/1995) Print N7298 at p 48
44 M9403
45 Ex 15 at [14]
46 Ex 15 at [19]
47 Ex 15 at [16]-[17]
48 Ex 15 at [62]
49 Ex 15 at [16]
50 s 531 of the Fair Work Act
51 For example, PN496 & PN501-503
52 NTEU v CPSU (1999) 93 IR 365 (NTEU) at [212]-[213]
53 AIPA’s closing written submissions at [220]
54 Ibid
55 AIPA’s closing written submissions at [350]
56 AIPA’s closing written submissions at [541(b)]
57 NTEU at [209]
58 Resmed at [96], applying ALAEA at [12]-[18]
59 Transcript, 23 November 2020, PN249
60 Ex 1 at [39] & [54]
61 Ex 1 at [101]
62 Ex 12 at [37]
63 Ex 23 at [11]-[12]
64 Transcript, 25 November 2020, PN1567
65 Ex 1 at [43]
66 Ex 21 at [73]
67 AIPA Rules Case at [17]-[18]
68 s 3 of the FW Act
69 s 3(f) of the FW Act
70 s 5(5) of the RO Act
71 s 5(1) of the RO Act
72 See, for example, Ex 3 at [3]-[7]
73 Ibid
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