ASC Pty Ltd v Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia

[2017] FWC 5375

[2017] FWC 5375

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
Section 418 - Application for an order that industrial action by employees or employers stop etc.

Section 229 - Application for a bargaining order

Section 425 - Application to suspend protected industrial action, cooling off

ASC Pty Ltd
v
Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia
(C2017/5600)

ASC Pty Ltd
v
Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia
(B2017/953)

ASC Pty Ltd
v
Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia
(B2017/952)

DEPUTY PRESIDENT ANDERSON ADELAIDE, 17 OCTOBER 2017

Protected industrial action at ASC Pty Ltd – advanced stage of bargaining for replacement enterprise agreement - action being engaged in during access period and in lead-up to vote – appropriate to order cooling-off having regard to factors in section 425 – suspension order made

Claim of unprotected industrial action – assertion by ASC Pty Ltd that CEPU not genuinely trying to reach agreement – orders sought under section 418 – conduct to date insufficient to warrant orders – inappropriate to make interim orders under section 420 - application adjourned

[1] These are the reasons for a decision and Order made at the hearing of this matter in Adelaide on 17 October 2017.

[2] This matter concerns applications made by the ASC Pty Ltd (ASC) under the Fair Work Act (FW Act) seeking orders against the Communications Electrical Electronic Energy Information Postal Plumbing and Allied Services Union of Australia - Electrical Energy and Services Division South Australian Branch (CEPU) and its members employed by ASC.

[3] On 6 October 2017 the CEPU served on the employer a notice under section 414 of the FW Act of intention to take industrial action in the form of an unlimited number of stop work meetings of varying times and duration between 12 October and 8 November 2017 (inclusive). It is this industrial action which the ASC seeks to have suspended or terminated by order of the Commission.

[4] In a decision dated 13 October 2017 1 (the earlier decision) I adjourned the ASC’s application for an order for suspension or termination of protected industrial action under section 425 of the FW Act. I concluded, on the evidence then before me, that the Commission’s power to make an order under section 425 had not been enlivened because, whilst a Notice of intention to take industrial action under section 414 had been issued by the union, the CEPU and its members had not then taken action in accordance with that notice. Accordingly, I found that the industrial action was not “being engaged in” within the meaning of section 425.

[5] I adjourned the applications part heard to a date after 20 October 2017 for a further report back by the parties. I provided liberty to both the ASC and the CEPU to call the matter on for further hearing at shorter notice should facts or circumstances arise which warrant that course.

[6] On 16 October ASC sought a further and urgent hearing of its application for orders suspending protected industrial action under section 425. At the hearing it also pressed its application for orders to stop unprotected industrial action under section 418.

[7] I listed the matter for hearing for 17 October. I did so in a timely manner having regard to the evidence already before me including the fact that a vote on a proposed replacement enterprise agreement is scheduled for 19 and 20 October.

[8] The background to this decision is set out in my earlier decision and need not be repeated. In arriving at this decision I have taken into account all of the evidence before me at the earlier hearing (12 October) as well as the further evidence now placed before me concerning developments over the past 36 hours. That further evidence taken at the 17 October hearing included a further witness statement of Nicole Kidman (tendered by ASC), a further statutory declaration of CEPU State Secretary John Adley, and oral evidence of CEPU Assistant Branch Secretary Simon Pisoni.

[9] In summary, the evidence now before me is that members of the CEPU employed by ASC stopped work for rolling half hour periods commencing at 12.45am Monday 16 October and continued on rolling periods throughout nightshift, dayshift and afternoon shift on that day, and then into 17 October. In total, fourteen stop work meetings have been held in the 36 hours prior to the hearing at 12.15pm 17 October.

[10] ASC submit that the stop work meetings constitute industrial action and that the industrial action (as well as its notification) is having an adverse effect on production schedules. The second witness statement of Nicole Kidman 2 appends advice from the ASC’s Electrical Trades Manager Mr Tauchnitz concerning material impacts in the first 24 hours of this action. ASC says that suspending the industrial action would limit damage to production and its commercial reputation including its contractual obligation to deliver a submarine product to the Australian Navy on 6 December. It says these are relevant factors the Commission should have regard to under section 425(1)(d).

[11] ASC also submit that in the context of the history of negotiation of the proposed replacement Agreement, it is likely to be beneficial to the bargaining representatives (which include all the unions, not just the CEPU) and assist the resolution of the matter if both the remainder of the Access Period and the voting period are conducted in an environment free from industrial action. It says this is a factor that should be taken into account under section 425(1)(a).

[12] The CEPU contend that its members are exercising their lawful right to take protected industrial action in support of their bargaining position. They say that the industrial action has not been for a prolonged duration and this should be taken into account under section 425(1)(b). It also says that as there is no likelihood of further negotiation on the terms of the proposed replacement Agreement before the scheduled vote by employees on 19 and 20 October then it could not be concluded that a suspension would either be beneficial to the bargaining representatives or assist in resolving the matters at issue.

[13] The CEPU also contend that pre-existing protected action in the form of bans on interstate travel to Western Australia, bans on working split shifts or staggered starts and bans on higher duties are continuing bans being taken by the collective unions (AMWU, AWU and CEPU) at the discretion of individual members. It says that an order suspending the CEPU protected action notified on 6 October (the stop-work meetings) would not render the environment free of industrial action.

[14] In response, the ASC say that the pre-existing bans (other than the CEPU stop-work meetings) are either not being actively engaged in or of a very minor nature. They say the employer is not rostering split shifts or staggered starts. They say there are no current travel requirements to Western Australia, and no ascertainable impact of the higher duties ban. They say that the CEPU stop-work meetings are, in practice, the only industrial action that is currently impacting the industrial environment and production.

[15] The nature of an agreement between the ASC and the collective unions (including the CEPU) on 26 September 2017 to provide two paid stop work meetings in return for the unions not notifying a new round of industrial action was in dispute in these proceedings. The evidence of Ms Kidman for the ASC is that she reached an agreement with the bargaining representatives of each of the unions (including Mr Pisoni of the CEPU) on 26 September, and confirmed that agreement in an email sent that day in the following terms:

“These paid meetings are subject to the following caveat consistent with your verbal undertaking this morning. The combined Unions agree that they will not notify ASC of any new industrial action effective from today 26 September until after 13 October 2017.” 3

[16] Mr Pisoni in his evidence accepted that he had been party to an undertaking of some form and that he had seen and read this written confirmation on the day but said that he had not then anticipated that CEPU members would move a motion on 5 October to notify new protected action. His evidence was that he had endeavoured to explain to Ms Kidman that the union position was that the position of delegates or bargaining representatives was always subject to the decisions of members.

[17] I find that the bargaining representatives of the collective unions, including the CEPU, reached an agreement with ASC on 26 September in the form set out by Ms Kidman in her email of that day. I find that ASC implemented its obligation under that agreement to provide two paid stop work meetings. I find that neither the AMWU nor the AWU notified fresh industrial action between 26 September and 13 October. I find that the CEPU did, by notice dated 6 October. That notice was inconsistent with the undertaking which Mr Pisoni had given to the ASC and the other unions on 26 September. I do not find however that Mr Pisoni gave that undertaking in bad faith. I accept his evidence that he did not anticipate, at that time, that CEPU members employed by ASC would authorise fresh industrial action at their meeting on 5 October.

Consideration of section 425 application

[18] Section 425 of the FW Act provides as follows:

“425 FWC must suspend protected industrial action--cooling off

(1) The FWC must make an order suspending protected industrial action for a proposed enterprise agreement that is being engaged in if the FWC is satisfied that the suspension is appropriate taking into account the following matters:

(a) whether the suspension would be beneficial to the bargaining representatives for the agreement because it would assist in resolving the matters at issue;

(b) the duration of the protected industrial action;

(c) whether the suspension would be contrary to the public interest or inconsistent with the objects of this Act;

(d) any other matters that the FWC considers relevant.

(2) The FWC may make the order only on application by:

(a) a bargaining representative for the agreement; or

(b) a person prescribed by the regulations.”

[19] As noted in my earlier decision, ASC is a bargaining representative for the Agreement. It has standing to make an application under subsection (2)(a). As further noted in my earlier decision, ASC acknowledges that protected action has been authorised by a vote of employees arising from a protected action ballot order issued by this Commission in 2016 and that protected action has been taken by the CEPU. Until the events of this week, the most recent prior protected action had been collective protected action taken by the three unions in the form of stop work meetings on 26 to 28 September 2017.

[20] It does not automatically follow that because industrial action is “being engaged in” then orders under section 425 should be made. Making an order is a discretionary matter and should only be made having regard to each of the matters set out in subsections (1)(a) to (d). Indeed, considerable weight should be given to the statutory scheme which provides a basis for industrial action taken in pursuit of bargaining to be protected. Section 425 is a statutory check to what is otherwise a collective bargaining right under the statutory scheme, should that right be lawfully exercised. A suspension order should not be issued lightly and only decided upon where it is clearly appropriate to do so.

[21] Having regard to the evidence before me, including the fact that fourteen stop-work meetings have been held in the past 36 hours, the agreement reached between the ASC and the bargaining representatives of the collective unions (including the CEPU) on 26 September, the history of negotiations between the collective unions and the ASC, the prior incidence of protected action and the advanced stage that the bargaining process has now reached I consider this a case in which it is appropriate to issue orders for a cooling off period under section 425.

[22] I consider that a suspension of protected action would be of benefit to the bargaining representatives in that it would permit the remainder of the Access Period and the voting period on 19 and 20 October to be conducted in an environment largely free from industrial action. This was the general intention of the agreement reached between the parties on 26 September. I consider this would allow employees the opportunity to consider and vote on the proposed Agreement in a relatively stable environment not significantly disrupted by industrial action. To this extent, I consider that it would assist in resolving the matters in issue.

[23] I take into account that the CEPU as a bargaining representative does not consider that an order would be beneficial to it or its members. I accept that further negotiation with the employer is not likely prior to the scheduled vote. However, whether an order would be beneficial to the bargaining representatives in that it would assist in resolving the dispute is to be objectively considered. At this advanced stage of bargaining it is not surprising that a relatively stable industrial environment for the vote is more likely to assist in resolving the matters than further negotiation on what is to be put to the vote. I also note that of the four bargaining representatives, only the CEPU is actively taking protected action at this advanced stage of the process. The employer is opposing it; the AMWU and the AWU are currently not doing so to any material extent. Hence, if orders are made it is possible that a more stable industrial environment in the days prior to the vote could be achieved. I further consider that an order enabling that climate to continue for a short period after the vote is taken to be appropriate. This would enable the outcome of the vote to be known and communicated, and next steps considered.

[24] I also consider the operational and commercial impacts on ASC to be relevant. The evidence before me is that the adverse impacts are real, are caused by the stop work meetings (and the future prospect of more) and that those impacts risk serious compromise to ASC meeting its contractual obligations. While the operational impacts of protected action are just one factor to be taken into account, in this case (and together with the aforementioned issues) they weigh in favour of orders being made.

[25] Accordingly, an order suspending protected industrial action taken by the CEPU and its members employed by ASC pursuant to its notice of 6 October 2017 is made in conjunction with this decision. The order will apply to all protected industrial action set out in the Notice of 6 October taken from 4.00pm today 17 October and apply until midnight Monday 23 October 2017.

Consideration of section 418 application

[26] ASC also pressed for its application for orders to stop unprotected industrial action under section 418 to be determined. Somewhat incongruously, the industrial action ASC rely upon is the same industrial action which it sought its order under section 425.

[27] ASC advance this case on two grounds. It says that the CEPU’s original notice of protected action of 6 October under section 414 contained a typographical error in that it referred to industrial action being taken from 12 September 2017 rather than 12 October 2017. However, ASC acknowledges that the CEPU cured that error quickly with a fresh notice of 6 October, and that the current industrial action is being taken under that fresh notice. Hence, that ground for asserting the action is unprotected action is not made out.

[28] The more substantive ground on which the ASC claim the CEPU’s current action is unprotected is that it claims that the CEPU is not genuinely trying to reach an agreement. It contends that this is one of the common requirements for industrial action to be protected under section 413 of the FW Act. In support of this ground it claims that the CEPU breached the undertaking given by its bargaining representative Mr Pisoni on 26 September not to give notice of new industrial action until after 13 October.

[29] I have found that the CEPU’s notice of 6 October was in breach of that undertaking. However, in assessing whether a person is genuinely trying to reach an agreement all of the relevant facts and circumstances must be taken into account. I have found that Mr Pisoni was acting in good faith on 26 September in that he did not anticipate that CEPU members would, in the days that followed, move of their own volition to instruct its officials to give notice of new industrial action. While the evidence suggests that Mr Pisoni did not counsel his members against that course on the ground that it would be a breach of the undertaking he had given as their bargaining representative, I do not consider that this is sufficient conduct to find that Mr Pisoni or the CEPU has not been, and is not, genuinely trying to reach an agreement. While ASC understandably consider a breach of trust between the bargaining parties to have occurred, Mr Pisoni himself was placed in a difficult position once his members decided to act of their own volition on 5 October.

[30] Accordingly, without more substantive evidence of bad faith or serious neglect to its responsibilities or compromise to the bargaining process I do not consider that the conduct of Mr Pisoni or other officials of the CEPU is currently sufficient to warrant a finding that the union is not genuinely trying to reach an agreement.

[31] Accordingly, sufficient grounds do not currently exist for an order to be made pursuant to section 418 of the FW Act. I will however further adjourn that application given that the bargaining process, including the conduct of the CEPU, remains ongoing. Having issued an Order under section 425 and for the reasons expressed I consider it would be unnecessary and contrary to the public interest to make interim orders under section 420.

[32] ASC’s application for bargaining orders under section 229 remains adjourned on the basis set out in my earlier decision.

DEPUTY PRESIDENT

Appearances:

Mr I. Colgrave, with permission, for the Applicant.

Mr J. Adley, Mr S. Pisoni and Mr P. Skeer, for the Respondent.

Hearing details:

2017.

Adelaide.

17 October.

 1   [2017] FWC 5295, DP Anderson, 13 October 2017

 2   Exhibit A3 Second witness statement of Nicole Kidman 16 October 2017 at paragraphs 3, 4 and 5 and NC2

 3   Exhibit A1 Statement of Nicole Kidman 12 October 2017 Attachment NK1

Printed by authority of the Commonwealth Government Printer

<Price code C, PR596878>