Arkwood Organic Recycling Pty Ltd T/A Arkwood Organic Recycling v Transport Workers' Union of Australia, Union of Employees (Queensland Branch)(

[2012] FWA 8916

[2012] FWA 8916

FAIR WORK AUSTRALIA

DECISION (3)

Fair Work Act 2009
s.603 - Application to vary or revoke a FWA decision

Arkwood Organic Recycling Pty Ltd T/A Arkwood Organic Recycling
v
Transport Workers' Union of Australia, Union of Employees (Queensland Branch)
(C2012/5488)

COMMISSIONER ASBURY BRISBANE, 18 OCTOBER 2012

Application to revoke orders of Asbury C issued in matter RE2012/1714 - PR529235 and RE2012/1715 - PR529236 - Inspection of non-member records - s.483AA - Fair Work Australia Rules do not require service on employer - Material sought to be inspected directly relevant to suspected breach - Reasonable grounds for suspected breach - Application for revocation refused - Application for amendment of operative date of Orders granted.

[1] The following Decision, now edited, was issued during proceedings on 10 October 2012.

Background

[2] This is an application by Arkwood Organic Recycling Pty Ltd (Arkwood) under section 603 of the Fair Work Act 2009 (the Act) to revoke orders issued by the Tribunal as presently constituted made in RE2012/1714. The Orders subject to these proceedings were made under section 483AA of the Act on 13 September 2012 following an ex parte hearing on that date.

[3] The Orders require Arkwood to produce or provide access to specified non-member records or documents, and to allow Mr Craig Williams and Mr Brendan Bogle, who are permit holders for the purposes of Chapter 3 Part 3-4 of Division 6 of the Act, to inspect and make copies of those records or documents. The documents to which the Orders relate are specified as:

• pay slips;



• other documents and records that relate to individual flexibility agreements; and



• the ability of employments to take their trucks home with them, or to bring their trucks to work in the morning.

[4] The s.483AA Orders were issued in response to applications made by the Transport Workers' Union of Australia on 6 September 2012. Those applications were made at the same time as an application under s.519 of the Act, seeking an exemption certificate with respect to the requirements under s.481 with respect to entry to premises to investigate a suspected contravention of the Act. The application for an exemption certificate was refused.

[5] The applications for Orders and the transcript are confidential and were not provided to Arkwood. My reasons for dealing with the applications on an ex parte basis and for making the orders under s.483AA of the Act are set out in the decision issued on 21 September 2012 1.

[6] In its response opposing Arkwood's application for revocation of the s.483AA orders, the TWU served copies of the applications for those Orders that were before the Tribunal on 13 September 2012, and an affidavit of Mr Craig Williams that set out and appended the evidentiary material that was relied on by the TWU at that hearing, except that the names of persons mentioned in the statements were redacted. The TWU also foreshadowed a counter-application to amend the Orders so that they would operate for an additional month. An application to that effect was formally made at the hearing into this application by Arkwood for revocation of the s.483AA orders.

The applications for revocation of the s.483AA Orders

[7] The submissions in support of the application for revocation of the s.483AA Orders set out what is said to be the factual background, in the following terms:

On 18 September 2012, Arkwood received Entry Notices from two organisers of the TWUQ, Mr Craig Williams (Williams) and Mr Brendan Bogle (Bogle). The Entry Notices stated that the organisers intended to access Arkwood’s premises on 19 September 2012 to investigate alleged contraventions of the Fair Work Act 2009 (Cth) (FW Act). However, the TWUQ failed to provide sufficient particulars regarding the alleged contraventions, as required by section 518 of the FW Act. Accordingly, the TWUQ was told that the Entry Notices were non-compliant with the FW Act and access would not be granted pursuant to the non-complying notices.

On 19 September 2012, the TWUQ served further Entry Notices on Arkwood which were compliant with the FW Act. On 20 September 2012, Williams and Bogle attended upon Arkwood’s premises to exercise their right of entry. At this time, Arkwood was provided with a copy of orders PR529235 and PR529236 dated 14 September 2012 (orde4rs), requiring access to non-member records and documents.

Arkwood subsequently sought clarification from the TWUQ as to the relevance of the documents required under the Orders, to any investigation by the TWUQ into alleged breaches of the FW Act. The TWUQ declined to comment on the relevance or otherwise of the documents sought under the Orders.

[8] Arkwood concedes that the application by the TWU under s.519 of the Act was required to be heard on an ex parte basis, but maintains that upon withdrawal of that application in the proceedings on 13 September 2012, there were no grounds upon which Fair Work Australia could proceed to deal with the s.483AA applications on an ex parte basis.

[9] Arkwood contends that s.483AA does not contemplate the hearing of such an application on an ex parte basis and that it has a right to be heard in respect of the Orders sought under that section. It is further contended that the failure to provide Arkwood with the right to be heard before the Order under s.483AA was issued, was a denial of natural justice.

[10] In relation to the orders, it is submitted that the Tribunal could not make the orders unless there was sufficient evidence to demonstrate that they were necessary to investigate suspected breaches of the Act. According to Arkwood's submissions, the applications made by the TWU under s.483AA of the Act are a “fishing exercise” not supported by tangible evidence in the form of witness statements. It is further submitted that the “reasonable suspicion” asserted by the TWU is founded upon oral statements made by unnamed TWU members to other unnamed TWU members, and that the applications seek access to non-member records and individual flexibility agreements which evidence private matters between Arkwood and its employees.

[11] Arkwood contends that the Tribunal should exercise its discretion under s.603 of the Act to revoke the Orders as the relevant preconditions for the making of the Orders have not been established, and the TWU has failed to demonstrate on the balance of probabilities that the Orders were necessary to investigate alleged contraventions of the Act. In its oral submissions, Arkwood conceded that the affidavit of Mr Williams and the statements appended to it may give rise to a reasonable suspicion of breaches of the Act. However, Arkwood maintained that there was no direct link between the materials sought to be inspected and the reasonable suspicion held by the TWU.

[12] Arkwood contends that the breaches suspected by the TWU were in relation to one employee, Mr Burton, and related to an inducement to enter into an individual flexibility agreement. The terms of the individual flexibility agreements entered into by Arkwood and its employees are irrelevant to the alleged breach. It was further submitted that the terms of the individual flexibility agreements are required to provide a benefit to employees by virtue of the Award provisions under which they were made, and that the agreements themselves were not evidence of inducement.

[13] It was submitted that if the submissions of Arkwood in relation to the revocation of the s.483AA Orders were rejected, then those Orders should be amended so that any disclosure of individual flexibility agreements was made in such a way that the identity of those employees who had entered into them was not disclosed. It was also submitted that the Orders should be amended so that the TWU could not use the information for a collateral purpose, evidence of which was said to be found in a statement of Mr Burton, a delegate of the TWU, to the effect that employees covered by the individual flexibility agreements were being underpaid.

[14] The TWU submitted that the power of the Tribunal to revoke an order is discretionary and has been exercised on very few occasions. The authorities in relation to the exercise of the discretion establish that reasons for making the order no longer prevail. 2 Other circumstances in which orders have been revoked include where an order has been made without disclosure of material facts3, or where there are changed circumstances4.

[15] In the present case it was submitted that Arkwood must satisfy the Tribunal that there can be no reasonable basis for the TWU's suspicion in relation to breaches of the Act. The evidence of Mr Carter in the original proceedings to obtain the orders was sufficient to satisfy the Tribunal that the orders should be granted; and it is submitted that that evidence is substantially the same as the evidence given by Mr Williams in these proceedings save that information that would reveal the identity of the employees has been removed.

[16] It was also submitted that there is no evidence before the Tribunal to suggest that the TWU requires the documents for any other reason than to substantiate or dispel the suspicion that members of the TWU are, or have been, subjected to adverse action, or offered inducements to resign their membership of the union. The confidential evidence relied on by the TWU to obtain the Orders and the evidence of Mr Williams in these proceedings is sufficient to cause a reasonable person to believe that there are grounds to suspect breaches of the Act in relation to either or both adverse action or inducements.

[17] The TWU further submits that the suspected breaches do not relate only to Mr Burton and that the terms of the individual flexibility agreements may substantiate the reasonable suspicion held by the union that there have been breaches of the Act on the part of Arkwood. The essence of the alleged breaches is that through a combination of offering individual flexibility agreements to some employees and removal of benefits previously enjoyed by other employees, Arkwood has used a “carrot and sticks” approach that constitutes adverse action under the terms of the Act.

[18] In relation to the relevance of the documents sought to be inspected, the TWU submits that they are directly relevant to its investigation of alleged contraventions of the Act. The TWU further submits that there is no requirement for a respondent in an application under s.483AA of the Act to be heard, and that the procedural rules of Fair Work Australia allow for such an application to be heard on an ex parte basis. While Arkwood has an interest in the matter, it does not have a right that has been removed or modified by the Orders granted on 13 September 2012, and they should not be revoked.

[19] The TWU also seeks a variation of the Orders so that they will operate for a further month, to enable it to carry out the investigations that it is entitled to carry out under those orders.

[20] I have considered all of the submissions and the material that is before me, both in these proceedings and in the original proceedings, and I am satisfied that the affidavit filed by Mr Williams in these proceedings is substantially identical to that of Mr Carter in the original proceedings that gave rise to the Orders; and that in the circumstances if there has been a denial of natural justice to Arkwood, that has been more than overcome by the manner in which these proceedings have developed.

[21] I accept that members of Fair Work Australia are bound to act in a judicial manner and apply the rules of natural justice. However the requirements of natural justice are not fixed and depend upon the nature of the inquiry, the circumstances of the case, the subject matter being ruled on and other relevant matters.

Conclusion

[22] The procedural rules relating to an application under s.483AA of the Act make it clear that the application is made on an ex parte basis. That is contained on the form F43 which has an instruction stating:

This application is made ex parte. That is, the application is not served on the relevant employer. Fair Work Australia will determine whether the employer and / or any wronged members should be served and given an opportunity to be heard.

[23] Rule 8 of the Fair Work Rules requires that applications must be served in accordance with the instructions as to service on the form for the application. The instruction on Form F43 makes it clear that there is no automatic requirement for the employer the subject of the application, to be served with the application. It is also clear from Rule 8 and the instruction on form F43 that Fair Work Australia has discretion as to whether the respondent to an application under s.483AA or any employee involved will be served and given an opportunity to be heard.

[24] On the basis of the material contained in the application, the original applications for the s.483AA Orders, and the s.519 application made at the same time, I determined that both applications would be heard on an ex parte basis and that the evidentiary material would remain confidential. I did so because of the nature of the allegations and the fact that the material identified employees of Arkwood. In all of the circumstances there was no requirement to allow Arkwood to be heard in relation to the applications, and in all of the circumstances that did not constitute a denial of natural justice.

[25] The material that was before me on the occasion when those Orders were issued was sufficient to ground a reasonable suspicion of a breach of the Act, in that it set out facts sufficient to induce that state of mind in a reasonable person; that suspicion is more than an idle wondering; and is an opinion that is without sufficient evidence. 5 That evidence may or may not be provided by the TWU inspecting the documents that it seeks to inspect. When the application for the Orders was heard, I was of the view that the documents sought to be inspected directly related to the contraventions alleged and tended to prove or disprove the allegations, and that was sufficient to allow for the documents to be inspected.6

[26] The essence of the allegations is that Arkwood has used individual flexibility agreements as an inducement to employees to resign their membership of the TWU and / or fail to offer individual flexibility agreements to employees who are members. The terms of the individual flexibility agreements and the identities of those who have entered into them could, in my view, tend to prove or disprove the allegations. I was also of the view that the documents sought to be inspected by the TWU were documents that the employer was required to keep as time and wages records, and also to provide to employees.

[27] Individual flexibility agreements which do not meet the requirements of the award would constitute a breach of the award. No right of Arkwood is affected by the order requiring that it make documents which it is otherwise required to keep as time and wages records available for inspection by the TWU.

[28] Because of the manner in which this matter has developed, Arkwood has now been provided with all of the material upon which the original decision to make the orders was based, notwithstanding that there was no requirement for this to occur.

[29] I have carefully considered the submissions advanced by Arkwood. There is nothing in those submissions that would have resulted in a different outcome had those submissions been made on 13 September 2012 before the orders were issued. Further, Arkwood has not established that reasons for making the orders no longer prevail or that they were made in the absence of some material fact.

[30] I do not accept that a statement by Mr Burton to the effect that in his view employees are underpaid, notwithstanding that they have entered into individual flexibility agreements, is a valid basis upon which I could be satisfied that the TWU is using the rights subject of this application for some collateral purpose, or would misuse any information that it obtains during its inspections. I also note that there are detailed provisions in the Fair Work Act to address such conduct.

[31] The application for revocation of the Orders is refused. I have also determined that the Orders should be amended in terms sought by the TWU in that their operative date should be extended by a period of one month. 7

COMMISSIONER

 1   [2012] FWA 8247

 2   BHP Coal Pty Ltd [2012] FWA 7187 at [6]; Rheem Rydalmere Plant Industrial Action Order 2002 [PR929970].

 3   Rubber, Plastic and Cable Making Industry Award 1972 (1975) 167 CAR 929.

 4   Re: United Fire Fighters Union of Australia (2002) 113 IR 60.

 5   National Tertiary Education Union v Central Queensland University [2009] FWA 780.

 6   Robson v Reb Engineering Pty Ltd (1997) 2 Qd R 102.

 7   Orders to this effect were issued on 11 October 2012 [PR530073 and PR530074]

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