[2021] FWC 356

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.229—Bargaining order

Association of Professional Engineers, Scientists and Managers, Australia
v
Mt Arthur Coal Pty Ltd
(B2020/18)

DEPUTY PRESIDENT SAUNDERS

NEWCASTLE, 25 JANUARY 2021

Good faith bargaining requirements – attending and participating in meetings at reasonable times – capricious or unfair conduct that undermines freedom of association or collective bargaining – recognising and bargaining with the other bargaining representatives for the agreement.

Introduction and background

[1] The Association of Professional Engineers, Scientists and Managers, Australia (APESMA) represents a number of the supervisors employed by Mt Arthur Coal Pty Ltd (Mt Arthur) at its open cut coal mine in the Hunter Valley of New South Wales (Supervisors). APESMA has been attempting to negotiate an enterprise agreement with Mt Arthur covering the Supervisors since about May 2018. Mt Arthur has not previously had an enterprise agreement covering the Supervisors.

[2] Mt Arthur is a subsidiary of BHP Group Limited (BHP).

[3] Operators employed by Mt Arthur to work at its mine in the Hunter Valley are covered by a separate enterprise agreement.

[4] In addition to APESMA, there were, until recently, two other employee bargaining representatives for the proposed agreement covering Supervisors: first, the CFMMEU represents a number of Supervisors; and secondly, Mr Mathew Kinross appointed himself as his bargaining representative. By email dated 20 November 2020, Mr Kinross informed the Fair Work Commission (Commission) and the other bargaining representatives that he was no longer representing himself in bargaining for the proposed enterprise agreement because he had changed roles. It is accepted that Mr Kinross is no longer in the position of Supervisor, with the result that he would not be covered by the proposed agreement. It follows that Mr Kinross is no longer a bargaining representative for the proposed agreement.

[5] In January 2020 APESMA made an application to the Commission for bargaining orders. Terms of settlement were reached on 30 March 2020 but they did not resolve all issues in the proceedings. On 11 September 2020 APESMA asked for its application for bargaining orders to be listed for hearing. The application was heard, by video conference, on 30 November 2020, and 1 and 11 December 2020. Evidence was given on behalf of APESMA by Ms Marisa Whitington, Senior Industrial Officer/Organiser of APESMA, and Mr Matthew Smith, Maintenance Field Supervisor of Mr Arthur. Mt Arthur adduced evidence from Ms Sally McLellan, Manager Employee Relations, and Mr Callum Baxter-Walters, Principal Employee Relations, and Ms Sophie Beaman, Senior Associate of Herbert Smith Freehills.

[6] In light of my significant involvement in conciliating this matter and related matters concerning bargaining for an enterprise agreement to cover the Supervisors, I gave each party the opportunity to object if they did not wish for me to determine the present application. Neither APESMA nor Mt Arthur made such an objection.

Statutory framework

[7] The relevant statutory provisions are found at sections 228 to 231 and 255(1) of the Act. They provide:

“228 Bargaining representatives must meet the good faith bargaining requirements

(1) The following are the good faith bargaining requirements that a bargaining representative for a proposed enterprise agreement must meet:

(a) attending, and participating in, meetings at reasonable times;

(b) disclosing relevant information (other than confidential or commercially sensitive information) in a timely manner;

(d) giving genuine consideration to the proposals of other bargaining representatives for the agreement, and giving reasons for the bargaining representative’s responses to those proposals;

(e) refraining from capricious or unfair conduct that undermines freedom of association or collective bargaining;

(f) recognising and bargaining with the other bargaining representatives for the agreement.

Note: See also section 255A (limitations relating to greenfields agreements).

(2) The good faith bargaining requirements do not require:

(a) a bargaining representative to make concessions during bargaining for the agreement; or

(b) a bargaining representative to reach agreement on the terms that are to be included in the agreement.

229 Applications for bargaining orders

Persons who may apply for a bargaining order

(1) A bargaining representative for a proposed enterprise agreement may apply to the FWC for an order (a bargaining order) under section 230 in relation to the agreement.

Note: See also section 255A (limitations relating to greenfields agreements).

Multi-enterprise agreements

(2) An application for a bargaining order must not be made in relation to a proposed multi-enterprise agreement unless a low-paid authorisation is in operation in relation to the agreement.

Timing of applications

(3) The application may only be made at whichever of the following times applies:

(a) if one or more enterprise agreements apply to an employee, or employees, who will be covered by the proposed enterprise agreement:

(i) not more than 90 days before the nominal expiry date of the enterprise agreement, or the latest nominal expiry date of those enterprise agreements (as the case may be); or

(ii) after an employer that will be covered by the proposed enterprise agreement has requested under subsection 181(1) that employees approve the agreement, but before the agreement is so approved;

(b) otherwise—at any time.

Note: An employer cannot request employees to approve the agreement under subsection 181(1) until 21 days after the last notice of employee representational rights is given.

Prerequisites for making an application

(4) The bargaining representative may only apply for the bargaining order if the bargaining representative:

(a) has concerns that:

(i) one or more of the bargaining representatives for the agreement have not met, or are not meeting, the good faith bargaining requirements; or

(ii) the bargaining process is not proceeding efficiently or fairly because there are multiple bargaining representatives for the agreement; and

(b) has given a written notice setting out those concerns to the relevant bargaining representatives; and

(d) considers that the relevant bargaining representatives have not responded appropriately to those concerns.

Non-compliance with notice requirements may be permitted

(5) The FWC may consider the application even if it does not comply with paragraph (4)(b) or (c) if the FWC is satisfied that it is appropriate in all the circumstances to do so.

230 When the FWC may make a bargaining order

Bargaining orders

(1) The FWC may make a bargaining order under this section in relation to a proposed enterprise agreement if:

(a) an application for the order has been made; and

(b) the requirements of this section are met in relation to the agreement; and

Note: See also section 255A (limitations relating to greenfields agreements).

Agreement to bargain or certain instruments in operation

(2) The FWC must be satisfied in all cases that one of the following applies:

(a) the employer or employers have agreed to bargain, or have initiated bargaining, for the agreement;

(b) a majority support determination in relation to the agreement is in operation;

(d) all of the employers are specified in a low-paid authorisation that is in operation in relation to the agreement.

Good faith bargaining requirements not met

(3) The FWC must in all cases be satisfied:

(a) that:

(i) one or more of the relevant bargaining representatives for the agreement have not met, or are not meeting, the good faith bargaining requirements; or

(ii) the bargaining process is not proceeding efficiently or fairly because there are multiple bargaining representatives for the agreement; and

(b) that the applicant has complied with the requirements of subsection 229(4) (which deals with notifying relevant bargaining representatives of concerns), unless subsection 229(5) permitted the applicant to make the application without complying with those requirements.

Bargaining order must be in accordance with section 231

(4) The bargaining order must be in accordance with section 231 (which deals with what a bargaining order must specify).

231 What a bargaining order must specify

(1) A bargaining order in relation to a proposed enterprise agreement must specify all or any of the following:

(a) the actions to be taken by, and requirements imposed upon, the bargaining representatives for the agreement, for the purpose of ensuring that they meet the good faith bargaining requirements;

(b) requirements imposed upon those bargaining representatives not to take action that would constitute capricious or unfair conduct that undermines freedom of association or collective bargaining;

(c) the actions to be taken by those bargaining representatives to deal with the effects of such capricious or unfair conduct;

(d) such matters, actions or requirements as the FWC considers appropriate, taking into account subparagraph 230(3)(a)(ii) (which deals with multiple bargaining representatives), for the purpose of promoting the efficient or fair conduct of bargaining for the agreement.

(2) The kinds of bargaining orders that the FWC may make in relation to a proposed enterprise agreement include the following:

(a) an order excluding a bargaining representative for the agreement from bargaining;

(b) an order requiring some or all of the bargaining representatives of the employees who will be covered by the agreement to meet and appoint one of the bargaining representatives to represent the bargaining representatives in bargaining;

(c) an order that an employer not terminate the employment of an employee, if the termination would constitute, or relate to, a failure by a bargaining representative to meet the good faith bargaining requirement referred to in paragraph 228(1)(e) (which deals with capricious or unfair conduct that undermines freedom of association or collective bargaining);

(d) an order to reinstate an employee whose employment has been terminated if the termination constitutes, or relates to, a failure by a bargaining representative to meet the good faith bargaining requirement referred to in paragraph 228(1)(e) (which deals with capricious or unfair conduct that undermines freedom of association or collective bargaining).

(3) The regulations may:

(a) specify the factors the FWC may or must take into account in deciding whether or not to make a bargaining order for reinstatement of an employee; and

(b) provide for the FWC to take action and make orders in connection with, and to deal with matters relating to, a bargaining order of that kind.

…

255 Part does not empower the FWC to make certain orders

(1) This Part does not empower the FWC to make an order that requires, or has the effect of requiring:

(a) particular content to be included or not included in a proposed enterprise agreement; or

(b) an employer to request under subsection 181(1) that employees approve a proposed enterprise agreement; or

(d) an employer to give a notice under section 178B; or

(e) an employer to specify a particular day in a notice under section 178B; or

(f) an employer to agree to the giving of a notice under section 178B.”

[8] The good faith bargaining requirements do not oblige a bargaining party to put self-interest to one side. 1 However, once an employer has agreed to bargain, or initiated bargaining, for an agreement, or a majority support determination or scope order is in operation, the employer must approach bargaining “with a genuine (or ‘good faith’) objective or intention of concluding an ‘enterprise agreement’ – if possible”.2 Indeed, if a party subject to the good faith bargaining requirements was not required to approach the task of bargaining with a view to achieving agreement if possible, it would defeat the objects of Part 2-4 of the Act and frustrate the making of enterprise agreements.3

[9] In Liquor, Hospitality and Miscellaneous Union v Foster’s Australia Ltd, 4 SDP Kaufmann observed that “The New Shorter Oxford English Dictionary defines ‘capricious’ as “guided by caprice; readily swayed by whim or fancy; inconstant” and ‘caprice’ as “an unaccountable change of mind or conduct…”.”

Relevant facts

[10] On 26 and 27 April 2018 the Supervisors who were, at that time, members of APESMA unanimously passed a motion requesting APESMA to commence bargaining with Mt Arthur for an enterprise agreement.

[11] By letter dated 21 May 2018, APESMA requested Mt Arthur to commence bargaining for an enterprise agreement to cover the Supervisors.

[12] By email dated 23 May 2018, Mt Arthur informed APESMA that it did not agree, at that time, to bargain for an enterprise agreement with the Supervisors. The following explanation was provided in an email from Mr Scott Donaldson, Principal Employee Relations, BHP, sent on 23 May 2018:

“… Mt Arthur Coal does not believe that collective bargaining is an appropriate or effective way to set the terms and conditions of employment for supervisor employees at our mining operation. Mt Arthur Coal is of the view that mutually advantageous terms and conditions can instead be secured through the continued use of individual employment agreements and, accordingly, maintains that it is not in the interests of either Mt Arthur Coal or our supervisors to commence collective bargaining. On this basis, Mt Arthur Coal does not agree to bargain at this time…”

[13] On 12 June 2018 APESMA applied to the Commission for a majority support determination in respect of the Supervisors employed by Mt Arthur. On 27 June 2018 Mt Arthur filed grounds of opposition to the application for a majority support determination.

[14] On 25 July 2018 I made orders by consent for the parties to conduct a ballot of Supervisors. Mt Arthur undertook to commence bargaining if the ballot showed that a majority of Supervisors wished to bargain. A ballot was undertaken. The results indicated that 65 Supervisors were eligible to vote, 58 Supervisors case a vote in the ballot, and 45 of the 58 Supervisors who voted wanted to bargain for an enterprise agreement. Mt Arthur then agreed to bargain, on 30 July 2018, as a result of the ballot.

[15] When bargaining commenced, there were four bargaining representatives:

(a) APESMA. In May 2019 Ms Marisa Whitington took over from Ms Belinda Giblin as the person within APESMA who was responsible for bargaining with Mt Arthur on behalf of Supervisors who are members of APESMA;

(b) CFMMEU. Mr Jeff Drayton is the person within the CFMMEU who is responsible for bargaining with Mt Arthur on behalf of Supervisors who are members of the CFMMEU;

(d) Ms Sally McLellan, on behalf of Mt Arthur.

[16] Bargaining meetings were held on 14 September 2018, 9 October 2018, 23 October 2018, 13 November 2018, 29 November 2018, 13 December 2018, 15 January 2019, 7 February 2019, 5 March 2019, 2 April 2019, 2 May 2019, and 27 May 2019. There was then a gap until the next bargaining meeting took place on 5 December 2019.

[17] At the bargaining meeting on 27 May 2019 Mr Drayton said that Mt Arthur’s proposal was “not palatable to Supervisors. This agreement won’t be voted up” and “There is a big difference between the Company’s position and the existing Mine enterprise agreement [covering operators] and that is causing tension for supervisors”. 5

[18] By letter dated 15 July 2019, APESMA made a request to Mt Arthur for a further bargaining meeting. In that correspondence, APESMA made the following comments in relation to what it considered to be delays in setting bargaining meetings:

“…Delay in setting bargaining meetings

At our last bargaining meeting on 27 May 2019 it was agreed that the Association needed to seek direction and feedback from our members on Mount Arthur’s response. On 25 June 2019 I advised that those members meetings would be held on 27 and 28 June, and requested a bargaining meeting be held following those meetings in the week starting 1 July 2019. It is now 2 and a half weeks since my request to meet and we have not had a response from BHP regarding our request.

The Association reminds BHP of their obligations under the good faith bargaining provisions of the Fair Work Act 2009, which include meetings at reasonable times. The Association is concerned that BHP is delaying bargaining meetings, contrary to your good faith obligations.

We reiterate our request to meet, and seek a meeting in the week of 22 July on any of the following days…

…

In the meetings held over 4 shifts on 27 and 28 June 2019 Supervisors voted unanimously to pass the following resolution:

The BHP values put health and safety first, acting with integrity, along with doing what is right.

As Supervisors, we are required to adhere to and enforce these values. The current proposal from BHP does not apply these values to us.

Supervisors call on BHP to provide a proposal within 14 days which puts safety first and does what is right. Supervisors call on BHP to provide a fair minimum pay offer and accident pay and redundancy pay in line with those we supervise…”

[19] By letter dated 18 July 2019, Mt Arthur responded to APESMA’s request to schedule additional bargaining meetings:

“… Request to schedule additional bargaining meetings

In relation to your request by email to schedule a further bargaining meeting in early July, as we had previously discussed, I was on annual leave during that time.

You have now proposed dates for further bargaining meetings commencing in the week of 22 July 2019 continuing thereafter.

Mt Arthur tabled its proposed agreement on 15 January 2019. Since 15 January, five further bargaining meetings have been held, during which Mt Arthur has repeatedly clarified its proposed agreement, explained its position and provided responses to the few counter-proposals presented by APESMA. At our most recent meeting on 27 May 2019, Mt Arthur again clarified its proposed agreement. APESMA advised it intended to seek direction and feedback from its members.

You have advised that meetings were held with APESMA’s members on 27 June and 28 June 2019 and a resolution was unanimously passed effectively calling upon Mt Arthur to improve its offer. From the feedback provided by you, no other proposal is put by APESMA or its members, other than that demanded for Mt Arthur to improve its offer.

Our position has not changed.

Accordingly, there is no indication that a further bargaining meeting at this time will progress bargaining.

The good faith bargaining obligations require that a representative attend and participate in meetings at reasonable times. If APESMA considers that meeting at this time would reasonably advance bargaining, please advise how in writing…”

[20] By letter dated 29 July 2019, APESMA made a further request to Mt Arthur for a bargaining meeting:

“… Whilst we disagree with your assertions regarding the conduct of bargaining so far, we do not wish to add anything further at this stage.

In our experience it is not unusual at this stage of bargaining for there to be difficult issues which often benefit from further discussion. As your experience will tell you, often matters that seem very difficult are able to be progressed and ultimately resolved with the goodwill of all parties. Solutions can be collaboratively worked out if both parties have an open mind and commitment to ultimately reaching an agreement. An open mind may require give and take. Of course, unnecessarily truncating discussions does not help our progress towards an agreement.

We urge BHP to reconsider its position and confirm our next bargaining meeting.

We can suggest the following dates…

At our last meeting, in response to our question, BHP was unable to advise how you paid Superannuation, whether it is levied on total remuneration or otherwise. Also the unions agreed to seek views from members on a time off in lieu proposal and payment for extra shifts proposal. It would be useful to discuss these issues at our next meeting, and I have accordingly included them in the agenda below.

Proposed Agenda;

1. BHP to table super information for discussion and consideration.

2. Unions to table draft TOIL and extra shift payment clause for discussion and consideration.

3. Unions to speak to the resolution put by supervisors and the feedback more broadly from shift meetings.

4. Accident Pay;

5. Redundancy – process and entitlement;

6. Remuneration.

I look forward to receiving your response and confirmation of our next bargaining date by close of business 31 July 2019…”

[21] By letter dated 31 July 2019, Mt Arthur responded to APESMA’s request for a further bargaining meeting:

“…Request to schedule additional bargaining meetings

You have now proposed dates for further bargaining meetings in August 2019.

As you know, Mt Arthur tabled its proposed agreement on 15 January 2019 and, at each bargaining meeting since then, Mt Arthur has repeatedly clarified its proposed agreement, explained its position and provided responses to the few counter-proposals presented by APESMA.

You have advised that meetings were held with APESMA’s members on 27 June and 28 June 2019 and a resolution was unanimously passed effectively calling upon Mt Arthur to improve its offer, specifically in relation to accident pay, redundancy and minimum remuneration.

You have now advised that APESMA wishes to table proposals in relation to time off in lieu (TOIL) and extra shift payments. These are matters that have previously been discussed in bargaining and the Company has stated its position on these matters.

We understand the effect of the resolution and repeat that our position in relation to accident pay, redundancy process and entitlement and remuneration has not changed since it was put to bargaining representatives on 15 January 2019 and clarified in each bargaining meeting thereafter.

If your proposals have changed on these matters, or APESMA has different or additional matters that it wishes to propose, we invite APESMA to do so in writing for the Company to consider. If it is apparent that a further bargaining meeting would assist to progress these matters, then the Company will propose dates for a further bargaining meeting.

Accordingly, as matters currently stand, we consider that there is no indication that a further bargaining meeting at this time will progress bargaining…”

[22] By email dated 19 August 2019, APESMA made a further request to Mt Arthur for “a bargaining meeting [to] be scheduled to discuss the outstanding issues with a view to making an Agreement.”

[23] By letter dated 23 September 2019, APESMA made a further request to Mt Arthur for bargaining meetings to be scheduled:

“We write in reference to your email dated 27 August 2019 and continuing refusal to meet with bargaining representatives.

Superannuation

We agree that a proposed superannuation clause was put by BHP earlier in the bargaining process. Subsequent to that proposed clause, information has come to light that there are discrepancies amongst supervisors on what earnings BHP pays superannuation. In your correspondence you have clarified superannuation is paid and topped up quarterly as necessary. In light of that information we believe it is appropriate that the proposed clause be redrafted to make clear on what earnings superannuation entitlements are payable, and to expressly provide that any shortfall in monthly payments is topped up quarterly or monthly as appropriate. We believe this can be best progressed by discussion of the precise text in a bargaining meeting.

Meeting request

We have previously advised BHP of the key outstanding issues (other than superannuation) and have discussed in meetings and in unanimous resolution from members why we believe the current offer is unfair.

These issues are as follows:

Minimum Pay
Redundancy Process and Pay
Accident Pay

We have considered these issues further and have developed a new bargaining position on them that we would like to put to you in a bargaining meeting.

We therefore request a 2 day lock up be scheduled so the Agreement can be finalised and suggest the following dates…

Should BHP continue to unilaterally refused to meet or demand we first put our proposal in writing without meeting to discuss these options, we put you on notice that this refusal would amount to a breach of BHP’s obligation to bargain in good faith. We further put BHP on notice that APESMA will consider its legal options and we reserve our rights in this regard…”

[24] On 28 October 2019 APESMA filed an application for the Commission to deal with a bargaining dispute, seeking the assistance of the Commission in finalising the proposed enterprise agreement. On 15 November 2019 a conciliation conference was held in the Commission involving APESMA and Mt Arthur in relation to the s 240 bargaining dispute application filed by APESMA. As a result of the conciliation conference, Mt Arthur provided bargaining representatives with an updated draft of the proposed enterprise agreement. The draft agreement was labelled “version 6c”. The covering email, dated 22 November 2019, by which version 6c of the proposed agreement was distributed to bargaining representatives was in the following terms:

“Following conciliation before the Fair Work Commission on 15 November 2019, please find attached a further revised version of the draft enterprise agreement (version 6c). For convenience, I have attached both marked up and clean copies and the changes from version 6b have been highlighted.

As discussed during conciliation, the Company is proposing a further bargaining meeting to hear the bargaining representatives’ feedback on the draft enterprise agreement, noting that it is the Company’s full position at this time and is substantially the same as the full position presented to bargaining representatives on 15 January 2019.

Could all bargaining representatives please confirm your availability to attend a bargaining meeting on Thursday 5 December at 12pm. We will confirm a venue upon notification of your availability, likely to be in Muswellbrook.”

[25] On 5 December 2019 a bargaining meeting was held. There is some dispute as to what was said at this bargaining meeting. To the extent that there is conflict in the evidence as to what was said, I prefer the contemporaneous file note made by Mr Baxter-Walters as the most reliable account of what was said during this meeting. 6 I find that the following matters of importance were discussed at the bargaining meeting on 5 December 2019:

• Ms Whitington asked Ms McLellan whether version 6c of the proposed enterprise agreement was the agreement that Mt Arthur would enter into. Ms McLellan responded by saying that it was Mt Arthur’s best position at this point in time. 7

• Ms Whitington stated that the feedback was that if version 6c was the final offer then they were happy for it to be taken to a vote and to have the agreement. Ms McLellan responded by expressing surprise at this position given the feedback received in negotiations, from what APESMA had said previously, and from the suggestion by APESMA that there were further positions to put forward. Ms Whitington replied by stating that:

• the delegates she had spoken to understood Mt Arthur’s position and that it was unwilling to move on its offer;

• she could not guarantee how employees would vote but members want to have the opportunity to vote on the agreement; and

• APESMA will support the agreement.

• Ms McLellan stated that it was a surprise that there had been such a turn around, Mt Arthur did not enter into ballots lightly, it was a stringent process that Mt Arthur would need to go through, and before Mt Arthur decided to put the agreement to a ballot it would need to canvass all parties (CFMMEU and Mr Kinross) to ensure the ballot had a likelihood of success.

• Ms McLellan stated that the next steps were to seek feedback from the other bargaining representatives, and Mt Arthur felt it was entitled to speak to its employees and get their feedback.

• There was discussion as to how feedback would be sought and in what timeframe. Ms McLellan then proposed the next steps would be to get feedback from Mr Kinross and the CFMMEU and then draft a plan to put the agreement to ballot.

[26] Ms McLellan believed that seeking feedback from the other bargaining representatives and the Supervisors was the right course of action for the following reasons:

(a) bargaining on behalf of Mt Arthur had been managed predominantly by Ms McLellan and members of the off-site employee relations team without significant input from site;

(b) Ms McLellan was not sure how many members APESMA had among the Supervisor cohort;

(c) Ms McLellan knew that Ms Whitington had exercised rights of entry on-site for the purpose of general discussions of behalf of APESMA on eight occasions. Ms McLellan believed that attendance at those meetings was frequently very low (in the order of no more than five Supervisors);

(d) in the ballot of Supervisors which occurred in July 2018, 13 of the 65 Supervisors voted no to the question “Do you want to bargain for enterprise agreement with your employer” and seven Supervisors did not respond;

(e) there were current Supervisors who had expressed a strong preference not to make an enterprise agreement; and

(f) the CFMMEU was a bargaining representative and had members working at the mine. The CFMMEU and Mr Kinross had not been present in the bargaining meeting on 5 December 2019 and had not provided any feedback to Mt Arthur in relation to the proposed enterprise agreement since the bargaining meeting on 27 May 2019.

[27] By letter dated 9 December 2019, APESMA notified Mt Arthur of its concern that Mt Arthur was not meeting its good faith bargaining requirements:

“… APESMA is concerned that BHP is not meeting its good faith bargaining requirements, in particular the requirement not to engage in conduct that undermines collective bargaining.

APESMA has two concerns in that respect. First, it is concerned that BHP has not committed to put to a vote the agreement that it has proposed, now that agreement with APESMA being reached.

Second APESMA is concerned that BHP is intending to speak to supervisors directly in circumstances where APESMA, as the bargaining representative that represents a majority of affected employees, has agreed to the proposed agreement being put to a vote so that it can be made…”

[28] On 9 December 2019 Ms McLellan spoke by telephone with Mr Drayton who said that the CFMMEU would not be supporting the proposed agreement and would not put its name to that agreement. Following her discussion with Mr Drayton on 9 December 2019, Ms McLellan:

(a) believed there was no consensus that the proposed agreement was acceptable;

(b) had no confidence in putting the proposed agreement to ballot and there was no reason for it to be put to a ballot when she was not confident;

(c) believed that, even if Mt Arthur had put the proposed agreement to a vote and it was approved by a small majority of employees, it was possible that the CFMMEU could oppose the application to the Commission for approval of the agreement;

(d) believed that a narrow ‘yes’ vote would cause division with the employees who held a very firm view that their employment should not be covered by an enterprise agreement and dissatisfaction with those where that enterprise agreement contained terms that they had said were manifestly unfair; and

(e) believed this would create a potential engagement issue for Mt Arthur.

[29] On 11 December 2019 Ms McClellan sent an email to Mr Kinross, inviting him to provide feedback on the proposed agreement. Ms McLellan did not receive any response from Mr Kinross and had no contact with him after sending her email to him on 11 December 2019.

[30] By letter dated 13 December 2019, Mt Arthur responded to APESMA’s letter of 9 December 2019:

“I refer to your letter of 9 December 2019, following a bargaining meeting on 5 December 2019.

During the meeting, APESMA asked that the Company’s proposed agreement (version 6c) (Proposed Agreement) be put to a vote of employees.

You have also stated now that APESMA, as the bargaining representative that claims to represent the majority of affected employees, has agreed to the Proposed Agreement being put to a vote.

The Company committed to providing the other bargaining representatives the opportunity to provide feedback on the Company’s Proposed Agreement, after which we would provide a response to APESMA.

Current Position

Our position has not changed.

The Company does not intend to put to vote an agreement for the purposes of testing its acceptance. Our position is that the Company will not consider putting any proposal to vote unless all the bargaining representatives agree to the proposal and undertake to support and encourage acceptance of it.

…

The CFMMEU has advised that it does not agree with the proposal, will not put its name to the Proposed Agreement, and clearly does not intend to support, or encourage acceptance of, the Proposed Agreement.

No individual bargaining representative nor any supervisor have advised they agree to the proposal, or that they will support and encourage acceptance.

As you would be aware, a number of employees expressly informed the Company that they did not support an enterprise agreement.

…

Summary

As stated during the bargaining meeting on 5 December 2019, the Company will not enter into an employee ballot lightly.

Based on the feedback of the bargaining representatives and employees, both throughout bargaining and now, the Company will not put the Proposed Agreement to a ballot at this time.

The Company denies any suggestion that it is not bargaining in good faith.” [emphasis added]

[31] On 19 December 2019 I conducted a conciliation conference involving APESMA and Mt Arthur in relation to APESMA’s s 240 bargaining dispute. At the conciliation conference Mt Arthur agreed to conduct an anonymous online survey of the Supervisors to obtain their feedback on the proposed agreement. APESMA was not comfortable with this proposal. After the conciliation, APESMA sent an email, at 5:06pm on 19 December 2019, setting out its proposal to obtain the views of Supervisors:

“Further to the conciliation held today in front of Deputy President Saunders, we can agree to a “pre-ballot” of affected employees.

I have attached for your reference the consent orders made regarding the majority support ballot conducted in 2018. We are seeking the same process. Namely,

1. The ballot is conducted by True Vote Pty Ltd (at APESMA’s expense)

2. The Respondent shall provide to True Vote Pty Ltd the email addresses for each person to be covered by the proposed agreement by COB 20 January 2020 (the “Employee List”).

3. The ballot shall be a secret ballot conducted via electronic voting. Neither the Applicant nor the Respondent shall have access to information disclosing the vote of any employee on the Employee List.

4. The ballot shall open at 12pm 28 January 2020 and close at 12pm on Friday, 30 January 2020.

5. The ballot shall put the following question:

Would you vote in favour of the proposed enterprise agreement?

Employees will have the following voting options available

Yes/No

6. Prior to the ballot, the Respondent will email each employee on the Employee List a copy of the proposed Agreement and the following statement:

In order to determine whether the attached agreement should be put to a vote of Supervisors at Mt Arthur, APESMA and Mt Arthur have agreed to arrange for an independent ballot to be conducted electronically by a company called True Vote Pty Ltd. The ballot will open at 12pm 28 January 2020 and close at 12pm 30 January 2020. You will be asked to vote Yes or No to the question “Would you vote in favour of the proposed enterprise agreement?”

You will each be emailed instructions by True Vote as to how to cast your vote.

It is your right to vote either yes or no in this ballot and you should not feel pressured by anyone.

7. The parties undertake that during the ballot they will not communicate with employees other than in accordance with the agreed statement at 6.

8. True Vote will advise the parties of the results of the ballot at the same time.

9. Should the majority of employees who cast a valid vote, vote Yes, the Respondent agrees to begin the access period within 24 hours of receiving the results, with a formal vote to be conducted 7 days after the access period commences, in accordance with the pre approval requirements of the Fair Work Act.

Although we are of the opinion that the informal voting process is unnecessary and causes undue delay, we do seek to resolve the Agreement without the need for further disputation.

We ask for a response to the above by COB 20 December 2019.”

[32] By email dated 24 December 2019, Mt Arthur responded to APESMA’s email of 19 December 2019:

“Thank you for your emails following conciliation before Deputy President Saunders on Thursday 19 December.

During the conciliation, BHP agreed to ‘informally seek feedback’ from employees within the relevant cohort. We did not agree to conduct a ballot of employees, or any other formal process, in the manner APESMA has proposed.

We will be informally seeking feedback from employees and intend to do this via an online survey, which can be answered anonymously.

As discussed during conciliation, we intend to conduct the survey in late January/early February 2020 to enable all employees to provide a response, if they wish to do so. Following the closure of the survey, BHP will determine next steps.

On that basis, we intend to correspond with you and all bargaining representatives further once BHP has considered the outcome of the survey and determined its next steps.”

[33] On 10 January 2020 APESMA filed an application in the Commission for bargaining orders against Mt Arthur. The particular orders sought in that application were as follows:

1. An order that Respondent refrain from capricious or unfair conduct that undermines freedom of association or collective bargaining.

2. Specifically an order requiring the Respondent to take steps to put the proposed agreement to a vote of eligible employees in accordance with the Fair Work Act 2009.

[34] On 20 January 2020 Mt Arthur filed a response to APESMA’s application for bargaining orders.

[35] On 31 January 2020 APESMA filed an amended application in the Commission for bargaining orders. In the amended application APESMA no longer sought the orders proposed in its original application and instead sought a range of orders concerning, inter alia, a proposed ballot of employees.

[36] In light of APESMA’s application for bargaining orders and correspondence between Mt Arthur and APESMA in late 2019, Mt Arthur did not take any steps in early 2020 to seek other feedback, informally or otherwise, directly from Supervisors in relation to the proposed agreement. 8

[37] APESMA’s application for bargaining orders was listed for hearing in the Commission on 30 and 31 March 2020. I conducted a conciliation conference on 30 March 2020, as a result of which Mt Arthur and APESMA entered into settlement terms whereby the Commission would conduct a ballot of Supervisors to find out which one of the following options they preferred:

1. I support the attached enterprise agreement [version 6c], and want to go to ballot.

2. I don’t support the attached enterprise agreement going to ballot, but I support further bargaining.

3. I don’t support any enterprise agreement.

[38] The ballot was open from 22 to 29 April 2020.

[39] On 30 April 2020 my Associate emailed the results of the ballot to Mt Arthur and APESMA. The results were as follows:

• the ballot was sent to 62 Supervisors;

• 40/62 Supervisors submitted a valid vote;

• 39/40 Supervisors who submitted a valid vote selected option one. That is, they voted in favour of supporting version 6c of the enterprise agreement and wanted to go to ballot;

• 1/40 Supervisors who submitted a valid vote selected option two; and

• 0/40 Supervisors who submitted a valid vote selected option three.

[40] By letter dated 5 May 2020, APESMA made a request to Mt Arthur for a bargaining meeting and informed Mt Arthur that its proposal for consideration at the meeting was for Mt Arthur to put the proposed agreement to a vote.

[41] By email dated 7 May 2020, Mt Arthur scheduled a bargaining meeting to take place on 12 May 2020. Mt Arthur did not, in that email, suggest that it was seeking any different terms in the proposed enterprise agreement.

[42] On 12 May 2020 a bargaining meeting took place. Representatives of APESMA and Mt Arthur attended the meeting. In addition, Mr Drayton of the CFMMEU attended the meeting. This was the first bargaining meeting attended by Mr Drayton since 27 May 2019. He has not attended a bargaining meeting since 12 May 2020. At the bargaining meeting the parties discussed the results of the ballot undertaken by the Commission. Mt Arthur announced that it wanted to make amendments to version 6c of the proposed enterprise agreement. APESMA also stated that it wanted to see amendments made to particular clauses of version 6c of the proposed agreement.

[43] On 20 May 2020 Mt Arthur issued an updated draft enterprise agreement to the bargaining representatives (version 7), which contained substantive amendments to the previous version (version 6c) in that Mt Arthur sought:

• the inclusion of a stand down clause in very wide terms in the enterprise agreement;

• the inclusion of a shut down clause in the enterprise agreement; and

• changes to the dispute resolution clause which would limit employees’ rights to be represented by unions in workplace disputes.

[44] On 25 May 2020 a further bargaining meeting was held. The parties discussed Mt Arthur’s proposed amendments to the agreement.

[45] By letter dated 29 May 2020, APESMA notified Mt Arthur of its good faith bargaining concerns in the following terms:

“I refer to the bargaining meetings held on 11 May 2020 and 25 May 2020 and the draft proposed enterprise agreement distributed by BHP on 20 May 2020, (v7), which incorporates significant changes to the previous BHP proposed agreement provided on 22 November 2019 (v6).

As stated in the bargaining meetings, we consider the company's conduct of drastically changing its previous proposed draft, after it had been agreed, to be not only unnecessary but capricious and unfair conduct contrary its good faith obligations under the Fair Work Act.

Background

On 22 November 2019 BHP put an enterprise agreement proposal which it said it could agree to (v6). The Association and its members accepted that proposal on 5 December 2019, and we have been requesting that BHP put the Agreement to ballot ever since.

Despite APESMA's agreement, BHP refused to put its proposed agreement to a ballot. It cited the need to obtain Supervisor's views. BHP said in early December 2019 that it would canvass Supervisor's views in late January 2020, but did not. In February, and in March 2020 BHP continued to fail to take steps to address the reason given for not proceeding to a vote - to canvass the views of Supervisors. It was not until 30 March, when APESMA brought the matter to hearing before the Fair Work Commission, that BHP agreed to a timetable to canvass Supervisor's views on its own enterprise agreement.

With the assistance of the Fair Work Commission the views of the Supervisors were duly balloted, and the results, declared on 30 April, confirmed that Supervisors overwhelmingly supported BHP putting v6 to a vote. 63% of all supervisors, and 97.5% of the supervisors who voted, supported v6 going to ballot. Only 1 supervisor voted in favour of further bargaining and none voted in favour of no enterprise agreement at all.

After 6 months of steadfastly delaying putting the proposed agreement to the vote, and as soon as the views of Supervisors were confirmed, removing the stated reason for delay, BHP told us it would be seeking a new and radically altered proposed enterprise agreement. That is capricious conduct.

From the outset BHP has taken steps consistent with not wanting to make an agreement for its Supervisors. It is now 22 months since Supervisors won the right to bargain via a ballot arising out of a majority support determination application. BHP's conduct is fundamentally inconsistent with BHP's commitment to the United Nations Global Compact that BHP will "make every effort to reach an agreement through genuine and constructive negotiations, and that both parties avoid unjustified delays in negotiations."

You stated in the meeting on 11 May 2020 that the changes were to allow BHP maximum flexibility to respond to situations such as the Covid pandemic. As we said, such flexibilities are currently available to employers under the Fair Work Act or under emergency legislation such as JobKeeper. The changes clearly go well beyond anything actually necessary to achieve 'flexibility' and are more properly seen as a deliberate (and capricious) step to using the Covid pandemic as an excuse to derail the bargaining. Once we saw the changes it is clear that most of them are unrelated to the Covid pandemic or any issue of 'flexibilities' to deal with such situations.

More specifically, and without limiting our concerns, they include:

1. Clause 3(b) - the parties have a shared understanding of the coverage of the Agreement, as confirmed during the pre-ballot process. We are concerned at the attempt, after agreement has been reached, to change the wording of the scope of the agreement by adding words that seek to exclude some supervisors. The issue of scope is hardly new - it was the basis of proceedings in 2018 in respect of an earlier proposed agreement. It is a change that cannot be justified as anything related to Covid-19.

We asked in the bargaining meeting on 25 May 2020 whether the proposed clause excludes or expands on the list provided to the Fair Work Commission during the pre ballot process. You said that under the proposed definition, the list would remain the same. If that IS the case then there does not seem to be a reason to seek a change to the previous draft.

2. Clause 6.1 - The purpose of this new clause is not apparent and is potentially confusing in effect. As you know, an Enterprise Agreement once made prevents the operation of the Award. There are no other industrial instruments that apply. The proposed clause states that the Agreement is in full substitution for the "Award and all other awards and agreements". Given that there are no other industrial instruments, all this provision might do is cause confusion as to whether this clause is intended to oust the effect of individual agreements, in a manner contrary to proposed Clause 10 that deals with employee's contracts.

At the meeting on 25 May 2020 you said that the clause was not intended to affect contracts and that you would come back to us with words to reflect this. Again, if that is the case then there does not seem to be a reason to add this provision to the text of the previous draft.

3. Clause 9 - this new clause seeks to add a power to the Company to stand down an employee without pay for a variety of circumstances specific to an employee (and entirely unrelated to any claimed need for increased flexibility), including for "neglect of duty'' and for "misconduct, while it is being investigated" (and without any provision that they be paid upon being established that there was no misconduct). This new clause is designed to introduce a provision that the Company knows would never be approved by employees.

There is nothing about the subject matter of this clause which could possibly be justified as arising out of the need for increased flexibility due to Covid-19.

4. Clauses 9.2-9.5 - These clauses purports to give the company the ability to stand aside an employee without pay upon an "interruption or reduction of work for which the Company cannot be reasonably be held responsible". In clause 9.5 that precondition is used as the basis to take a variety of actions, including to reduce salary and allowances on two days’ notice down to an amount that is no more than 1% above the Award rate. There is no minimum amount by which the work needs to 'reduce', nor any minimum period during which the work would need to be interrupted, before the precondition is triggered. Section 524 of the Act provides a right to stand down for a variety of reasons, most of which are repeated in clauses 9.2-9.5. Adispute as to whether a company can stand-down under that Part can be arbitrated by the FWC. There is no provision in the proposed agreement allowing a dispute as to a stand-down under the new proposed clauses to be arbitrated. In short, clauses 9.2-9.5 seek to significantly widen the circumstances in which a stand-down can occur, to significantly widen the actions that can be taken in those circumstances, and to do so in a manner that shields the company from any action to dispute its conduct before the Fair Work Commission. It is clearly intended to prevent agreement being reached.

5. Clause 12.1 (a) - the addition of the words "from the workplace" seek to prevent an employee being able to ask a union employee or officer to be their representative. This change was not flagged at any previous meeting as something that BHP wanted to revisit in negotiations. This is a significant alteration to an agreed position dealing with representative rights. It has nothing to do with flexibility. It has nothing to do with Covid-19.

During the bargaining meeting on 25 May 2020 you stated that this was to "clarify" what had been the understanding of BHP during negotiations. As I stated, it was always our understanding that the Dispute Resolution Clause had the effect as drafted, which reflects the Award and the model clause, and that there is no reason to have read the agreed clause as meaning that a union representative could not represent a member during a dispute under the Agreement if the member requested that representation.

6. Clause 21.4 - this new subclause seeks to introduce the right to shutdown "a part of or the entire Mine Site and require the taking of annual leave". Where an employee does not have sufficient annual leave to cover the whole period of the shut-down they can be required to take leave without pay. There is no capacity to take annual leave in advance. There is no limit on the length of the shut-down. The clause would allow any employee to be directed to take leave, even though only a part of the Mine was being shut-down. There are no prerequisites for the reason for the shut-down. The shut-down could be for reasons entirely within the control of the Company. The clause is, in effect, a clause that would give the Company the right to direct any employees to not attend work for any length of time and relieve the Company of the right to pay them, once their annual leave ran out, without that being industrial action. There is no good reason to introduce such a significant change after agreement had been reached.

We note that the Covid pandemic was a known event for months prior to our last bargaining meeting and that the company at no earlier time had sought to discuss any challenges the company is having responding to the pandemic under its current industrial arrangements, or indicated that it would necessitate any change in its bargaining position. Rather the change to the bargaining position has arisen only after the company found that, as a result of the vote of the Supervisors, there was no outstanding reason not to proceed to put v6 to a vote. The company has a mature risk management framework, and can be assumed to at all times have been well aware of the variety of circumstances that can arise that might affect production. It is not as if Covid-19 has changed any of those circumstances. We find it disingenuous for the company to seek to insert these clauses at this late stage to provide 'flexibility' to address such issues when it has ample opportunity over the course of bargaining to do so.

The agreed proposal (v6) negotiated over a 22 month period allows for considerable flexibility and as discussed, does nothing to increase the current cost base to the company.

In all those circumstances the changes sought by the company to its own preferred enterprise agreement are considered to be a capricious and unfair change in bargaining position being pursued as an attempt to delay an agreement being made. APESMA as a result has a genuine and serious concern that BHP is not meeting its good faith bargaining requirements, in particular is not meeting the requirement set out in s228(1)(e).

APESMA calls on the company to proceed to put its v6 draft enterprise agreement to a vote, action that Supervisors have overwhelmingly voted for…”

[46] On 29 May 2020 APESMA also filed a s 240 bargaining dispute in the Commission.

[47] Between 1 and 3 June 2020 the General Manager of the Mt Arthur mine, Mr Adam Lancey, held meetings with Supervisors (without APESMA’s knowledge or invitation to attend). Mt Arthur did not call Mr Lancey to challenge the evidence of Ms Whitington as to what was said in those meetings. At those meetings I accept the unchallenged hearsay evidence of Ms Whitington that Mr Lancey asked Supervisors why they wanted an enterprise agreement and Mr Lancey said words to the following effect: 9

• I don’t know the history of the EA.

• It is unusual in the industry for supervisors to have an EA. You’re in the leadership team. I don’t know of any other supervisors with an EA.

• I will look at putting accident pay and redundancy in your contracts.

[48] On 3 June 2020 Mt Arthur filed its response to APESMA’s s 240 application.

[49] By letter dated 4 June 2020, APESMA notified Mt Arthur of its concerns that the meetings held by Mr Lancey with Supervisors between 1 and 3 June 2020 were contrary to Mt Arthur’s obligations of good faith bargaining.

[50] By letter dated 9 June 2020, Mt Arthur advised APESMA that it had provided a reply to APESMA’s letter of 29 May 2020 in its response to the s 240 application filed and served on 3 June 2020, but in any event provided a further detailed response denying APESMA’s allegations that it had acted contrary to its good faith bargaining obligations. Mt Arthur also attached a revised proposed enterprise agreement (version 7a) to its letter dated 9 June 2020.

[51] By letter dated 11 June 2020, Mt Arthur responded in the following terms to APESMA’s letter dated 4 June 2020:

“I refer to your letter of 4 June 2020.

The Company denies your concerns that:

• Meetings were held with Supervisors on 1 June and 3 June 2020 and APESMA was not notified of these meetings prior to them occurring and supervisors were not provided with any agenda prior to the meetings taking place.

• The meetings appear designed to speak about the bargaining outside of the bargaining process, bypassing bargaining representatives, and to convince Supervisors that an enterprise agreement is not necessary, and designed to pressure Supervisors into not making an enterprise agreement.

• It is not bargaining in good faith.

Mt Arthur invited Supervisors on shift to meet with Mt Arthur’s General Manager, Adam Lancey, on 1 June 2020 and 3 June 2020, as part of its regular updates it provides to its workforce. At these meetings, Mr Lancey discussed a number of updates relevant to Supervisors, including the response to Covid-19, recordable injuries, and business performance.

The Company is under no obligation to notify APESMA, or to provide any ‘agenda’ before arranging such meetings with its employees.

Following discussion of the above items, Adam did raise the proposed Mt Arthur Coal Supervisors Enterprise Agreement 2020 (Proposed Agreement). The terms of settlement agreed on 30 March 2020 do not prevent Mt Arthur from meeting with Supervisors to discuss the Proposed Agreement. Nor do the good faith bargaining obligations prevent Mt Arthur from communicating directly with its own employees.

Nevertheless I have organised to meet with Adam to confirm that in any meetings with Supervisors he does not discuss matters that should be raised in bargaining meetings and dealt with by the bargaining representatives.”

[52] On 11 June 2020 a further bargaining meeting took place.

[53] By letter dated 16 June 2020, APESMA requested Mt Arthur to provide an amended version of the proposed enterprise agreement with Mt Arthur’s proposed wording in relation to the personal/carer’s leave clause.

[54] By email dated 17 June 2020, Mt Arthur provided all bargaining representatives with version 7b of the proposed enterprise agreement.

[55] On 18 June 2020 a bargaining meeting took place.

[56] On 22 June 2020 I conducted a conciliation conference in which the dispute resolution clause in the proposed agreement was discussed.

[57] On 23 June 2020 Mt Arthur circulated a further updated draft of the proposed enterprise agreement (version 7c).

[58] By email dated 2 July 2020, APESMA sought confirmation from Mt Arthur as to the wording of the dispute resolution clause in the proposed agreement.

[59] By email dated 21 July 2020, APESMA sought a response from Mt Arthur to APESMA’s email of 2 July 2020 and communicated its proposed version of the shut down clause.

[60] By letter dated 6 August 2020, APESMA sought Mt Arthur’s response to APESMA’s earlier correspondence on 2 and 21 July 2020.

[61] By email dated 12 August 2020, Mt Arthur informed the bargaining representatives of its position in relation to the remaining clauses in dispute.

[62] On 14 August 2020 I conducted a conciliation conference.

[63] On 17 August 2020 I issued a written recommendation in which I recommended the terms of what I understood to be the three remaining outstanding provisions of the proposed enterprise agreement, namely stand down, dispute resolution, and shut down.

[64] By letter dated 1 September 2020, APESMA informed Mt Arthur that it had commenced consultation with its members in relation to my recommendations and “members have advised that the feedback on the draft clauses is heavily dependent on whether BHP will now proceed to put the whole agreement in its current form (Version 7c) plus the Commission recommendations to a vote ... Can you please advise us whether BHP will put the Fair Work Commission recommendations plus version 7c to the vote?”

[65] By email dated 7 September 2020, Mt Arthur responded in the following terms to APESMA’s letter of 1 September 2020:

“Thank you for your letter dated 1 September. It appears from your letter that APESMA is content to accept the Recommendation of Deputy President Saunders issued on 17 August 2020 (Recommendation).

At this stage, we do not accept the Recommendation in full. We wish to discuss aspects of the Recommendation further at the conference listed before the Deputy President for 11 September 2020.”

[66] I conducted a further conciliation conference involving APESMA and Mt Arthur on 11 September 2020. During the conciliation conference:

• Ms Reid, counsel for APESMA, stated that she had instructions to seek a commitment from Mt Arthur to put the revised agreement, including the three clauses containing my recommendations, to vote, otherwise APESMA would ask for directions to be made for its good faith bargaining application to be heard. Ms Reid also said that APESMA would accept the wording in the three clauses containing my recommendations to go to a vote;

• Mr Coonan, solicitor for Mt Arthur, responded on behalf of Mt Arthur to each of my recommendations for the three outstanding clauses. Mr Coonan explained that Mt Arthur accepted some of my recommendations but did not accept others. He identified which recommendations were accepted and which were not. He also provided some explanation for the recommendations which were not accepted. In respect of some of my recommendations, Mr Coonan explained that the concept embedded into the recommendation did not cause an issue but the wording did. Mr Coonan did not give details of the wording which would be acceptable to Mt Arthur with respect to some parts of my recommendation.

[67] Mt Arthur has not communicated in writing to the Commission or any bargaining representative the details of its response to my recommendations or its reasons for not accepting any part of my recommendation.

[68] After the conciliation conference on 11 September 2020, I issued directions to prepare APESMA’s application for bargaining orders for hearing.

[69] By letter dated 2 October 2020, APESMA gave Mt Arthur notice of its continuing good faith bargaining concerns:

“APESMA continues to have concerns (within the meaning of s229(4) of the Fair Work Act) that the ongoing course of conduct engaged in by BHP in respect of bargaining for an enterprise agreement to apply to supervisors at Mt Arthur is only consistent with it having an intention to avoid making an agreement with supervisors, contrary to BHP's good faith bargaining obligations.

Specifically, APESMA continues to have concerns that BHP has altered its bargaining position capriciously on more than one occasion to avoid agreement being reached and consistently acts in a manner that leads to unnecessary delay in the bargaining.

Since I last raised such concerns in correspondence, the following conduct has occurred.

Since 29 May 2020 APESMA has been seeking to resolve the disputed content of the additional clauses BHP capriciously sought to add to version 6c on 20 May 2020 after that version had been agreed and overwhelmingly endorsed by a vote of supervisors.

APESMA wrote to BHP on 2 July 2020 regarding clause 12.1(b)(i), and again on 21 July 2020 seeking an answer to the correspondence of 2 July 2020 and proposing wording on "shut down".

We did not receive any response to this correspondence.

APESMA wrote to BHP againon 6 August 2020, seeking an answer to its previous correspondence of 2 July 2020 and 21 July 2020, and proposing wording on "stand down". BHP chose to put a position only on 12 August 2020 in advance of a conciliation hearing on 14 August 2020. BHP's position also capriciously sought further revisions broadening its own position on "stand down".

Following conciliation on 14 August 2020 the FWC made recommendations on the 17 August 2020 to resolve the disputed content of the additional clauses BHP had earlier sought to add to version 6c.

APESMA wrote to BHP in respect of the recommendations on 1 September 2020 asking whether BHP would put version 7c as amended in accordance with the FWC recommendations to a vote of supervisors.

BHP did not communicate any alternative proposals prior to the conciliation conference listed for 11 September 2020.

Following that conciliation conference APESMA understands that BHP does not accept the recommendations. However BHP has failed to write to APESMA or explain to relevant employees why the recommendations are not accepted by BHP nor what steps are required before an agreement can be made.

APESMA asks the company to put V7(c) as amended in accordance with the FWC recommendations to a vote of eligible employees so that an Agreement can be made. If that is not to be done, we request reasons as to why that is to not be done.

In conclusion, in addition to our earlier expressed concerns about BHP's approach to bargaining we say the above ongoing conduct reveals that BHP is conducting bargaining with no intention of reaching agreement and with an intent to cause unnecessary delay, being conduct in breach of its good faith bargaining obligations found at s228 (1) of the Fair Work Act 2009…”

[70] By email dated 9 October 2020, Mt Arthur responded to APESMA’s letter of 2 October 2020 and stated that it would comply with the agreed directions made on 11 September 2020.

How many Supervisors does APESMA and the CFMMEU represent?

[71] The number of Supervisors varies from time to time. There were 65 Supervisors in mid-2018 and 62 Supervisors in April 2020. The evidence discloses that APESMA represents 29 Supervisors.

[72] There is a dispute in the evidence as to how many Supervisors are members of, and therefore represented by, the CFMMEU in bargaining for an enterprise agreement with Mt Arthur.

[73] Ms Whitington gave the following evidence in her witness statement dated 27 February 2020:

“… I understand from:

a. on-site meetings that I attended where supervisors had identified themselves as being members of the CFMEU; and

b. mapping documents that have been completed by APESMA elected supervisor delegates and APESMA members which have identified which supervisors are CFMEU members

that there are approximately 4 supervisors that are members of the CFMEU.”

[74] Ms McLellan gave evidence in her witness statement dated 19 March 2020 that she spoke to Mr Drayton on 9 December 2019, at which time he said words to the effect, “we have four OCEs [members] and the rest in the workshop, about 20 members”. An “OCE” is an Open Cut Examiner. They are part of the Supervisor cohort.

[75] Ms Whitington responded to this evidence from Ms McLellan as follows in her witness statement in reply dated 26 March 2020:

“4.3 In relation to paragraph 47, I believe the CFMMEU has substantially less than 20 members in the total current supervisor cohort eligible to vote on the enterprise agreement. I understand the phrase “in the workshop” to refer to supervisors employed in the maintenance area. I do not believe CFMMEU have approximately 16 members who would be eligible to vote “in the workshop”. I understand from information provided by APESMA supervisor delegates that there are only 17 supervisors employed in the maintenance area, and of those 17 supervisors, I understand that:

4.3.1 2 are members of CFMMEU;

4.3.2 6 are members of APESMA (and not also members of CFMMEU); and

4.3.3 1 (Matthew Kinross) is an individual bargaining representative.”

[76] Ms McLellan replied to this evidence from Ms Whitington as follows in her witness statement dated 30 March 2020:

“3. In relation to paragraph 4.3 of the Whitington Reply Statement, I agree that the reference to “in the workshop” refers to Supervisors in the Maintenance area, and maintain that Jeff Drayton told me that the CFMMEU has 20 members across the Supervisor cohort. The CFMMEU has represented Production and Maintenance Supervisors in employment-related matters in my experience with the Respondent.”

[77] Mr Smith gave evidence that there were about 20 maintenance Supervisors at the Mt Arthur mine.

[78] The CFMMEU was notified of these proceedings but did not take any part in them. The evidence given by both Ms Whitington and Ms McLellan as to the number of Supervisors who are members of the CFMMEU is hearsay and therefore of limited weight. On the balance of probabilities, I am not persuaded on the evidence that the CFMMEU has about 20 members who are Supervisors. I find that the CFMMEU has about four to six members who are Supervisors. I make these findings for the following reasons:

• The CFMMEU has only been involved in bargaining to a limited extent. If it represented approximately one third of the Supervisor cohort (20 out of about 60 Supervisors), I would expect from my extensive dealings with the CFMMEU in the black coal mining industry in the Hunter Valley that it would have played a far more significant part in bargaining for an enterprise agreement to cover the Supervisors.

• The CFMMEU is clearly opposed to the various enterprise agreements and bargaining proposals made by Mt Arthur. Given this opposition, if the CFMMEU represented about 20 Supervisors, it is likely there would not have been such strong support for the making of version 6c of the enterprise agreement in April 2020.

• There are about 17 to 20 maintenance Supervisors. In my view, Ms Whitington’s evidence that six of the maintenance Supervisors are members of APESMA (and not also members of CFMMEU) and one (Mr Kinross) is an individual bargaining representative is likely to be reliable and correct. It follows that, at most, 13 of the maintenance Supervisors could be members of the CFMMEU. If one adds the four OCE’s which Ms McLellan says Mr Drayton told her about to the potential 13 maintenance Supervisors, the total still does not reach 20 Supervisors.

• The CFMMEU has a number of members employed at the Mt Arthur mine as operators. Some operators act as “step-up” Supervisors from time to time to cover Supervisors who are absent or otherwise engaged. These “step-up” Supervisors are not proposed to be covered by the agreement being negotiated by, inter alia, APESMA and Mt Arthur, but their temporary engagement as Supervisors may cause some legitimate confusion as to the number of Supervisors who will be covered by the proposed agreement and who are members of the CFMMEU.

[79] On any view of the evidence, the CFMMEU represents a minority of the Supervisor cohort. My findings below concerning whether Mt Arthur has met its good faith bargaining requirements would not change if I had found that the CFMMEU was the bargaining representative for about 20 Supervisors, rather than about four to six Supervisors.

Has Mt Arthur met its good faith bargaining requirements?

[80] APESMA contends that Mt Arthur has failed to meet the following three good faith bargaining requirements:

(a) to attend and participate in meetings at reasonable times (s 228(1)(a) of the Act);

(b) to refrain from capricious or unfair conduct that undermines freedom of association or collective bargaining (s 228(1)(e) of the Act);

[81] Although there is overlap between a number of the particular allegations made by APESMA, I will address each allegation by summarising the parties’ main submissions and deciding whether the good faith bargaining requirement has been met.

Attend and participate in meetings at reasonable times

APESMA’s submissions

[82] APESMA submits that the obligation to attend and participate in meetings at reasonable times is not a requirement that only arises when and if the party is satisfied that in its opinion it would be of utility to have a meeting.

[83] APESMA contends that Mt Arthur’s refusal to schedule bargaining meetings from 1 July 2019 to 4 December 2019 (even with the knowledge that APESMA had new bargaining positions to discuss) amounted to a clear failure to comply with the good faith bargaining requirement that it attend meetings at reasonable times. In support of this argument, APESMA relies on the fact that it repeatedly wrote to Mt Arthur in the period from 25 June 2019 requesting further bargaining meetings be scheduled but Mt Arthur refused to schedule any such meetings. It was only after APESMA filed a dispute with the Commission and a conciliation conference occurred that Mt Arthur scheduled another bargaining meeting for 5 December 2019. That bargaining meeting led to a major breakthrough in the negotiations. APESMA submits that Mt Arthur had successfully delayed such a meeting for about six months by insisting on being told in writing the need for a meeting and then determining for itself whether it thought that reason was sufficient.

Mt Arthur’s submissions

[84] Mt Arthur submits that on the two occasions it did not respond to requests for meetings in July 2019, Ms McLellan was on leave. It is submitted that there is no good faith bargaining obligation breach if a person does not arrange/attend a meeting while on leave.

[85] Mt Arthur submits that in response to the requests for meetings made on 15, 17 and 18 July 2019, Ms McLellan replied on 18 July 2019. Mt Arthur submits that these events need to be considered in the context of:

• a request by APESMA for a delay in bargaining from 25 May to 15 July 2019;

• after that almost two month period of delay, APESMA’s reply with:

• no new proposals;

• no counter-proposals; and

• a simple demand for a proposal within 14 days that Mt Arthur “does what is right” and put a proposal that provides a fair minimum pay offer and accident pay/redundancy pay in “line with those we supervise”.

[86] Mt Arthur also contends that Ms Whitington’s evidence was that APESMA had “nothing to add” and, as at 18 July 2019, APESMA had no further clauses to put on the table. Mt Arthur’s response was that its position on each of those matters had not changed and it is submitted that Ms McLellan rightly asked how a meeting could progress bargaining. Even then, Mt Arthur submits that Ms McLellan did not refuse to have any more meetings at all. Ms McLellan said that if APESMA considered a meeting would progress bargaining, it should advise her how in writing. Mt Arthur contends that APESMA did not reply to that request. Mt Arthur submits that, at this point, as far as bargaining positions were concerned, APESMA knew Mt Arthur’s position on each of the three matters, APESMA had put its latest position such as it was and Ms McLellan put Mt Arthur’s response to that position. Then, on 29 July 2019, APESMA requested a meeting. Mt Arthur submits that in its request for a bargaining meeting, APESMA disagreed with Mt Arthur’s position on bargaining and said “We do not wish to add anything further at this stage”. It is submitted that APESMA simply urged Mt Arthur to reconsider its position and confirm a further bargaining meeting. In its reply two days later, Mt Arthur says it did not refuse to hold a meeting with APESMA. Instead, Mt Arthur advised that it would propose dates for a further meeting if APESMA’s position changed on any of the issues referred to or APESMA had additional or different proposals to put them in writing. Mt Arthur submits that APESMA did not do so.

[87] Mt Arthur submits that APESMA did nothing for nearly two months until, on 23 September 2019, it responded requesting meetings on 17 October 2019 – nearly three months later.

[88] Mt Arthur submits that the Commission should take into account the unfairness in the double standards put by APESMA in its case. APESMA refused to put a position in writing in July 2019, but in its concerns letter of 2 October 2020 it (wrongly) criticised Mt Arthur for allegedly refusing to put proposals in writing. Mt Arthur contends that APESMA’s submissions are unfair and capricious.

Consideration

[89] It is clear from the evidence that APESMA made requests to Mt Arthur on 25 June 2019, 15 July 2019, 29 July 2019, 19 August 2019 and 23 September 2019 for bargaining meetings to be held. Mt Arthur did not schedule a bargaining meeting at any time in the period from 1 July 2019 to 4 December 2019. The bargaining meeting which took place on 5 December 2019 was only arranged after APESMA filed a dispute in the Commission and a conciliation conference took place.

[90] I am satisfied that in the period from 1 July 2019 to 4 December 2019 Mt Arthur failed to meet its requirement to attend and participate in meetings at reasonable times (s 228(1)(a) of the Act). In respect of the period from 23 September 2019 until 4 December 2019, Mt Arthur was on notice that APESMA had “developed a new bargaining position on [three outstanding issues] that we would like to put to you in a bargaining meeting”, 10 yet Mt Arthur unreasonably refused to arrange a bargaining meeting. In respect of the earlier period from July 2019, it is correct that Mt Arthur and APESMA had each put different positions in relation to key outstanding issues. However, as APESMA communicated to Mt Arthur in its letter of 29 July 2019:11

“In our experience it is not unusual at this stage of bargaining for there to be difficult issues which often benefit from further discussion. As your experience will tell you, often matters that seem very difficult are able to be progressed and ultimately resolved with the goodwill of all parties. Solutions can be collaboratively worked out if both parties have an open mind and commitment to ultimately reaching an agreement. An open mind may require give and take. Of course, unnecessarily truncating discussions does not help our progress towards an agreement.

We urge BHP to reconsider its position and confirm our next bargaining meeting.

…

[91] It is apparent from this correspondence that there were meaningful matters to discuss at a bargaining meeting. Rather than organise such a meeting, Mt Arthur sought to impose a pre-condition to any such meeting, namely that APESMA put any different or additional matters in writing, which Mt Arthur would consider and “if it is apparent that a further bargaining meeting would assist to progress these matters, then the Company will propose dates for a further bargaining meeting”. 12 It was unreasonable in the circumstances for Mt Arthur to impose such a pre-condition on attending and participating in bargaining meetings.

[92] I do not accept Mt Arthur’s submission that there is no good faith bargaining obligation breach if a person does not arrange or attend a meeting while on leave. The requirement in s 228(1)(e) to attend and participate in meetings at reasonable times does not cease to exist simply because one individual is on leave. The fact that a key person is on leave may, depending on the extent of the leave, mean that a reasonable time for a bargaining meeting is shortly after the person returns from leave, but it certainly does not justify a failure to attend any bargaining meetings for a period in excess of five months.

[93] As to Mt Arthur’s submissions concerning APESMA having “nothing to add”, the communications need to be considered in context. By letter dated 18 July 2019, Mt Arthur made assertions in relation to the conduct of bargaining up until that time. 13 In its letter of reply dated 29 July 2019, APESMA responded by stating, “Whilst we disagree with your assertions regarding the conduct of bargaining so far, we do not wish to add anything further at this stage.”14 Construed in context, it is clear that APESMA was communicating to Mt Arthur that it did not, at that time, wish to respond in detail to Mt Arthur’s contentions concerning bargaining up until that point in time. APESMA was not saying that it did not have anything further to add to the bargaining for terms to be included in the proposed enterprise agreement. Ms Whitington agreed in cross examination that APESMA did not have any further clauses to put to Mt Arthur on 18 July 2019,15 but she clearly indicated in writing that there were meaningful matters to be discussed in a bargaining meeting.16

[94] I do not accept Mt Arthur’s submission that APESMA did nothing for nearly two months until, on 23 September 2019, it responded requesting meetings on 17 October 2019 – nearly three months later. APESMA made five requests for bargaining meetings in the period from 25 June 2019 until 23 September 2019. It is also clear from the evidence that APESMA was consulting with members in the Supervisor cohort about a range of issues in the relevant period. 17

[95] As to Mt Arthur’s contention concerning “double standards” put by APESMA in its case, there is no allegation that APESMA has failed to attend or participate in meetings at reasonable times. APESMA’s request for Mt Arthur to put proposals in writing is addressed below.

Refrain from capricious or unfair conduct that undermines freedom of association or collective bargaining

Unfair and capricious conduct – setting pre-conditions it knew could not be met

APESMA’s submissions

[96] APESMA submits that after hearing it was prepared to agree to Mt Arthur’s proposed enterprise agreement on 5 December 2019, Ms McLellan concluded the meeting on that day by proposing next steps to get feedback from Mr Kinross and the CFMMEU and then draft a plan to put the agreement to ballot. Ms McLellan said nothing to the effect that the agreement of the other bargaining representatives would be required.

• Mt Arthur had introduced new clauses to the proposed agreement, after it had been agreed with APESMA and the support of Supervisors for the proposed agreement was made clear by the results of the survey undertaken by the Commission;

• Mt Arthur had capriciously and deliberately introduced new clauses that were unrelated to the COVID-19 pandemic or any issue of flexibility to deal with such situations;

• Mt Arthur had pressed the addition of the new clauses in an attempt to delay an agreement being made. 58

[197] On 4 June 2020 APESMA gave Mt Arthur notice of its concern that Mr Lancey had bypassed the employee bargaining representatives and spoken to Supervisors directly about bargaining matters in an attempt to pressure Supervisors into not making an enterprise agreement, including by suggesting that some claims may be able to be included in Supervisors’ individual contracts of employment. 59

[198] On 2 October 2020 APESMA gave Mt Arthur notice of its concerns that:

• Mt Arthur had taken steps consistent with not wanting to make an enterprise agreement;

• Mt Arthur had introduced new clauses after version 6c was overwhelmingly endorsed by a survey of Supervisors conducted by the Commission;

• Mt Arthur had delayed responding to APESMA’s questions and proposals in a timely manner, causing the bargaining to proceed unnecessarily slowly;

• Mt Arthur had failed to explain in writing why the Commission’s recommendations were not accepted in full; and

• Mt Arthur had not put version 7c as amended by the Commission’s recommendations to a vote. 60

[199] It is apparent from the previous five paragraphs that, in respect of each of the breaches of Mt Arthur’s good faith bargaining requirements that I have found above, APESMA gave Mt Arthur written notice of its concerns in relation thereto, save for my finding that Mt Arthur engaged in unfair conduct that undermines collective bargaining by imposing a condition in December 2019, and maintaining the condition thereafter, that all employee bargaining representatives must agree to, and support, any enterprise agreement before it is put to a vote. Although APESMA did not give Mt Arthur written notice of this concern before it filed its original application for bargaining orders in the Commission on 10 January 2020, the application states, as one of the grounds on which Mt Arthur was not meeting its good faith bargaining obligations, that “there is no requirement for all bargaining representatives to agree prior to a proposed Agreement being put to a vote”. At all times since 10 January 2020 Mt Arthur has been on notice of APESMA’s contention in relation to this issue. In all the circumstances, I am satisfied that it is appropriate for the application to be considered even though notice of this particular concern was not given to Mt Arthur in writing before the application for bargaining orders was filed in the Commission. It follows that I am satisfied that the prerequisite specified in s 229(4)(b) of the Act has been met.

Reasonable time to respond

[200] As a prerequisite for making an application for bargaining orders, APESMA must have given Mt Arthur a reasonable time within which to respond to its concerns, unless the Commission is satisfied that it is appropriate in all the circumstances for the application to be considered even though such time has not been given (s 229(4)(c) and (5) of the Act).

[201] In each of the concerns letters identified in paragraphs [198] to [202] above APESMA gave Mt Arthur a reasonable time within which to respond to its concerns. I am therefore satisfied that the prerequisite specified in s 229(4)(c) of the Act has been met.

APESMA’s consideration that Mt Arthur has not responded appropriately

[202] As a further prerequisite for making an application for bargaining orders, APESMA must consider that Mt Arthur has not responded appropriately to its concerns (s 229(4)(d) of the Act).

[203] I am satisfied on the basis of Ms Whitington’s evidence that APESMA genuinely considers that Mt Arthur has not responded appropriately to the concerns it has raised. I am therefore satisfied that the prerequisite specified in s 229(4)(d) of the Act has been met.

Bargaining orders sought by APESMA

[204] APESMA seeks the following bargaining orders:

“1. Within 7 days, the Respondent write to the Applicant:

a) confirming whether it proposes to put version 7(c) of the agreement (as amended by the recommendations of the Fair Work Commission on 17 August 2020) to a vote to have it approved by employees; and if so, by when it will proceed to take steps to have the Proposed Agreement approved by employees;

b) if the Respondent does not intend to take steps to put version 7(c) of the agreement as amended by the recommendations of the Fair Work Commission to a vote, provide to the Applicant in writing reasons for not doing so, including (to the extent it is because it rejects any of the Fair Work Commission recommendations) why it rejects the Fair Work Commission’s recommendations.

2. If, pursuant to order 1(b), the Respondent confirms it does not intend to take any steps to put version 7(c) of the agreement (as amended by the recommendations of the Fair Work Commission on 17 August 2020) to a vote, then within a further 3 days, the Respondent is to write to all employees to be covered by the proposed enterprise agreement setting out the reasons for not putting version 7(c) to a vote, including (if it rejects any of the Fair Work Commission recommendations) why it rejects the Fair Work Commission recommendations and explaining why it prefers different clauses.

3. The Respondent is to advise the Applicant of the identity the person or persons within BHP who have the authority to make the decision as to whether any proposed agreement will go to a vote.

4. The person(s) identified by Order 3, or in the alternative the Respondent, are to provide an explanation in person to:

a) bargaining representatives; and

b) those to be covered by the proposed agreement

why the Respondent agreed that the Fair Work Commission should conduct a ballot of Supervisors as to whether they wanted version 6c put to a vote (‘the FWC Ballot’), yet following the results of the FWC ballot the Respondent decided not to implement the outcome by not putting version 6c to a vote.

5. The person(s) identified by Order 3, or in the alternative the Respondent, are to

communicate:

a) in writing to each of those to be covered by the proposed agreement; and

b) in a meeting attended by such employees;

that the Respondent has been found in breach of its good faith bargaining obligations and say whether or not that was a consequence of decisions they made.

6. The person(s) identified by Order 3, or in the alternative the Respondent, are to

communicate:

a) in writing to each of those to be covered by the proposed agreement; and

b) in a meeting attended by such employees;

to the extent such findings are made by the Commission:

(i) that the decision to not put a proposed agreement to a vote following

the FWC ballot was capricious behaviour which undermined collective

bargaining;

(ii) the Respondent has by its actions caused unjustifiable delays in the

negotiations in breach of the Respondent’s good faith bargaining obligations.

7. The Respondent is, within 7 days, to tell the Applicant whether there is a proposed enterprise agreement it is prepared to consider making.

8. The Respondent is to ensure that at all future bargaining meetings it has present or available a person who has the authority to make decisions and/or give meaningful instructions.

9. The Respondent is to meet with the Applicant, under the auspices of a member of the Fair Work Commission, on dates to be determined by the Commission, to discuss making a proposed enterprise agreement.

10. The Respondent is to cease:

a) to cause delay in the making a proposed enterprise agreement;

b) to bargain in a capricious manner;

c) to bargain in an unfair manner;

d) to raise new issues or barriers to the making of an enterprise agreement with the purpose of frustrating or delaying the making of an agreement; and

e) such other conduct as the Commission finds is conduct in breach of the Respondent’s good faith bargaining obligations.

11. The Respondent is not to alter standard terms contained in contracts of employment of those to be covered by the proposed enterprise agreement outside of the enterprise bargaining process.

12. Until the bargaining for an enterprise agreement has come to an end, the Respondent and its employees are restrained from exerting undue influence or pressure on individuals or groups who are eligible to participate in a vote to approve an enterprise agreement to persuade them to vote against the proposed enterprise agreement or to persuade them to oppose the making of an enterprise agreement.

13. Such other or further order as the Commission considers appropriate.”

Applicable principles re bargaining orders

[205] As Justice Flick observed in Endeavour Coal (at [78]), “the meaning of the requirements imposed by that subsection [s 228(1)] are relatively easy to resolve. The difficulty is in the formulation of orders to give effect to those requirements without trespassing into the prohibited territory created by s 228(2).”

[206] An order requiring a bargaining representative to propose terms of an enterprise agreement that it would be prepared to enter into would fall foul of section 228(2)(a), because such an order would require the bargaining representative to make a “concession” as to which terms are acceptable and those which are not. 61

[207] The Commission’s power to make bargaining orders is confined to directing things to be done to ensure compliance by one or more of the bargaining representatives with the good faith bargaining requirements. 62 Further, the Commission must be satisfied that it is reasonable in all the circumstances to make the order (s 230(1)(c) of the Act).

Consideration re bargaining orders

[208] As to proposed order 1(a), Mt Arthur has made clear during the course of these proceedings, including in its written submissions, 63 that it does not agree to version 7c (as amended by the Commission’s recommendations). I therefore do not consider that proposed order 1(a) has any utility.

[209] As to proposed orders 1(b) and 2, Mt Arthur has not put its position in response to the Commission’s recommendations in writing and there remains some uncertainty about Mt Arthur’s complete response thereto. For those reasons, there is utility in making such orders. Further, such orders will avoid any unnecessary delay in bargaining associated with the uncertainty in Mt Arthur’s current bargaining position. I do not accept Mt Arthur’s contention that proposed order 1(b) is designed to require it to advise APESMA what terms it will and will not agree, contrary to s 228(2) or s 255(1) of the Act. The order is designed to ensure there is clarity as to Mt Arthur’s current bargaining position and to avoid any unnecessary delay in bargaining associated therewith. The order does not require Mt Arthur to propose terms of an enterprise agreement that it would be prepared to enter or to make any “concession” as to which terms are acceptable and those which are not.

[210] As to proposed order 3, it is clear from the evidence given by Ms McLellan in these proceedings that the General Manager of the Mt Arthur mine (currently Mr Lancey) is the person who has the authority to make the decision as to whether any proposed agreement will go to a vote. I therefore do not consider that proposed order 3 has any utility.

[211] I do not consider it appropriate to make proposed order 4 because I have found that, having regard to changed circumstances, Mt Arthur acted reasonably in proposing some amendments to the proposed agreement in May 2020, rather than putting version 6c to a vote.

[212] I do not consider it appropriate to make proposed order 5 or 6 in circumstances where the majority of Supervisors are represented by either APESMA or the CFMMEU and this decision, which contains detailed findings as to which conduct on Mt Arthur’s part constituted a contravention of its good faith bargaining requirements and who engaged in such conduct, will not only be sent to APESMA and the CFMMEU (as well as Mt Arthur), but will also be published on the Commission’s website and therefore available to all Supervisors to read and consider. Further, I do not consider that making such orders would ensure, or enhance the prospect of, compliance by one or more of the bargaining representatives with their good faith bargaining requirements.

[213] As to proposed order 7, Ms McLellan is the lead negotiator on behalf of Mt Arthur. At no time during the very lengthy period of bargaining has Ms McLellan been given instructions that Mt Arthur would be willing to put any agreement to a vote. I consider that it would avoid any unnecessary delay and reduce the likelihood of unfair or capricious conduct that undermines collective bargaining or freedom of association for Mt Arthur to tell APESMA whether there is a proposed enterprise agreement it is prepared to consider making. An order in those terms would not require Mt Arthur to propose terms of an enterprise agreement that it would be prepared to enter or to make any “concession” as to which terms are acceptable and those which are not.

[214] As to proposed order 8, Ms McLellan has been attending all bargaining meetings on behalf of Mt Arthur. Ms McLellan is a senior and experienced employee. She has given evidence, which I accept, as to the internal processes applicable to the development of bargaining proposals or positions for Mt Arthur. I do not consider those processes to be unusual, inappropriate or to have caused any unnecessary delay in the context of bargaining in a large corporate entity. I therefore decline to exercise my discretion to make proposed order 8.

[215] I consider it appropriate to make proposed order 9. Having regard to my extensive experience in dealing with the parties in connection with their bargaining for an agreement to cover Supervisors, I accept APESMA’s submission that many more advancements are made in bargaining for a proposed agreement to cover Supervisors when the Commission is involved in such discussions. I consider that making such an order will avoid any unnecessary delays and will ensure, or enhance the prospect of, compliance by the bargaining representatives with their good faith bargaining requirements.

[216] Proposed order 10 is directly responsive to findings I have made concerning Mt Arthur’s breaches of its good faith bargaining requirements. I consider that making such an order will ensure, or enhance the prospect of, compliance by Mt Arthur with its good faith bargaining requirements. I will amend paragraphs (b) and (c) of the proposed order to ensure the composite expression “capricious or unfair conduct that undermines freedom of association or collective bargaining” in s 228(1)(e) is reflected in the orders; it is not enough that conduct simply be unfair or capricious.

[217] As to proposed order 11, the evidence discloses that Mr Lancey made the suggestion in June 2020 that individual contracts of employment may be able to be varied to address some of the issues identified in bargaining. Although there is no evidence that any such contracts have been varied or any offer has been made by Mt Arthur to vary such a contract, I consider that the issue is an important one. Any attempt to vary individual contracts for Supervisors to address one of the outstanding issues in bargaining would undermine the collective will of the Supervisors to continue bargaining for an enterprise agreement. I do not accept Mt Arthur’s contention that proposed order 11 will have the effect of enforcing by Commission order what APESMA seeks in bargaining. The proposed order will not enforce or require Mt Arthur to do anything. It will prevent Mt Arthur from seeking to undermine the collective bargaining process.

[218] In all the circumstances, I consider it appropriate to make proposed order 11, albeit I will amend the order so as to ensure it is properly directed to ensuring Mt Arthur complies with its good faith bargaining obligations and carve out of the order any remuneration increase which may be proposed by Mt Arthur in accordance with its usual practices or processes for one or more Supervisors. The remuneration issue was raised in oral submissions and I am satisfied that neither party would wish to prevent such benefits flowing to Supervisors while bargaining is ongoing. The order will cease to operate in accordance with s 232(b) of the Act.

[219] As to proposed order 12, I have found that, excluding consideration of what Mr Lancey said to Supervisors between 1 and 3 June 2020, Mt Arthur has not, on the evidence adduced in these proceedings, exerted undue influence or pressure on Supervisors to persuade them to vote against the proposed enterprise agreement or to persuade them to oppose the making of an enterprise agreement. Proposed order 11 addresses the comments made by Mr Lancey concerning the potential inclusion of particular benefits in individual contracts of employment. Further, Ms McLellan spoke to Mr Lancey shortly after his discussions with Supervisors in early June 2020 and told him that in any meetings with Supervisors he ought not discuss matters that should be raised in bargaining meetings and dealt with by the bargaining representatives. There is no suggestion that Mr Lancey or any other manager on the part of Mt Arthur has engaged in any such discussions with Supervisors since that time. For these reasons, I decline to exercise my discretion to make proposed order 12.

[220] I am satisfied that it is reasonable in all the circumstances to make the bargaining orders set out in the following paragraph. In my view, such orders will direct things to be done (or not done) to ensure, or enhance the prospect of, compliance by Mt Arthur with its good faith bargaining requirements. There are some minor amendments between the orders sought and the orders I have decided to make. For example, because I have decided not to make proposed order 1(a), and proposed orders 1(b) and 2 follow on from 1(a), I have reframed orders 1(b) and 2 accordingly. I have also extended some of the time periods, such as from 7 days to 14 days, to ensure Mt Arthur has a reasonable time to comply with the orders, particularly having regard to the absence of some employees from work in January. No changes of substance have been made.

[221] The following orders [PR726407] in accordance with this decision will be issued separately.

1. Within 14 days of the date of these orders, Mt Arthur Coal Pty Ltd (Mt Arthur) must provide to the Association of Professional Engineers, Scientists and Managers, Australia (APESMA), the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU) and all employees to be covered by the proposed enterprise agreement (Supervisors) written reasons as to why it does not intend to put version 7c of the proposed enterprise agreement (as amended by the recommendations of the Fair Work Commission on 17 August 2020 (Recommendations)) to a vote, including (to the extent it is because it rejects any of the Recommendations) why it rejects the Recommendations.

2. Within 14 days of the date of these orders, Mt Arthur must inform APESMA in writing whether there is a proposed enterprise agreement it is prepared to consider making.

3. Mt Arthur is to meet with APESMA (and any other employee bargaining representatives who wish to attend), under the auspices of a member of the Fair Work Commission, on dates to be determined by the Commission, to discuss making a proposed enterprise agreement.

4. Mt Arthur is to cease:

a) to cause delay in the making of a proposed enterprise agreement;

b) to bargain in a capricious manner that undermines collective bargaining or freedom of association;

c) to bargain in an unfair manner that undermines collective bargaining or freedom of association; and/or

d) to raise new issues or barriers to the making of an enterprise agreement with the purpose of frustrating or delaying the making of an agreement.

5. Save for any increase in remuneration which Mt Arthur may put in place for one or more Supervisors in accordance with its usual practices or processes, Mt Arthur is not to alter standard terms contained in contracts of employment of Supervisors outside of the enterprise bargaining process where those terms have been the subject of bargaining in relation to the making of an enterprise agreement to cover the Supervisors.

Conclusion

[222] For the reasons stated, I am satisfied that:

(a) an application for bargaining orders has been made by APESMA (s 230(1)(a) of the Act);

(b) Mt Arthur has agreed to bargain for the proposed agreement (s 230(2) of the Act);

(d) APESMA has met the requirements of s 229(4) and (5) of the Act (s 230(3)(b) of the Act);

(e) the requirements of s 230 of the Act are met in relation to the proposed agreement (s 230(1)(b) of the Act); and

(f) it is reasonable in all the circumstances to make the orders set out in paragraph [221] above (s 230(1)(c) of the Act), and such orders comply with the other requirements of the Act, such as ss 228(2), 231 and 255(1).

DEPUTY PRESIDENT

Appearances:

I Taylor, senior counsel, with L Reid, counsel, on behalf of APESMA
M Coonan, solicitor, with S Beaman, solicitor, on behalf of Mr Arthur

Hearing details:

2020.
Newcastle (by video conference):
30 November, 1 and 11 December.

Printed by authority of the Commonwealth Government Printer

1 Endeavour Coal Pty Ltd v APESMA (2012) 206 FCR 576 (Endeavour Coal) at [34]

2 Endeavour Coal at [34], [45], [46] & [47]

3 Endeavour Coal at [46]

4 [2009] FWA 750 at [13]

5 Ex R3 at [17]

6 Ex R6 at CJB-1

7 Ex R3 at [22]

8 Ex R3 at [55]

9 Ex A4 at [26]-[28]

10 Court Book at 64

11 Court Book at 56

12 Court Book at 58

13 Court Book at 54

14 Court Book at 56

15 PN499

16 Court Book at 56-57

17 See, for example, Court Book at 56

18 Ex R3 at [49]

19 CFMEU v Tahmoor Coal Pty Ltd[2010] FWAFB 3510 at [30]

20 Court Book at 124

21 PN1511

22 Court Book at 293

23 Ibid

24 Ibid

25 Ex R3 at [37]

26 Ex R3 at [38]

27 Ex R3 at [27]

28 Court Book at 294

29 Court Book at 294

30 Ex R3 at [55]

31 Court Book at 293

32 Ex R3 at [26]

33 Court Book at 894

34 Ex R4 at [47]

35 Mt Arthur’s “note re market forces” dated 14 December 2020

36 PN1409-1411

37 PN1413

38 PN1415-1416

39 PN1407

40 PN1557-1570

41 PN1570

42 PN1557, 1560 & 1569

43 Ibid

44 See paragraphs [16] and [27] above

45 PN1323

46 PN1319

47 PN1433

48 PN1477

49 PN1570

50 PN1630

51 TWU v Chubb Security Services[2012] FWA 2226 at [57]

52 [2010] FWAFB 3510

53 Ex A4 at [26]-[28]

54 Ex R4 at SM-16

55 Ex A2 at MW-03, MW-08, MW-10; Ex A4 at MW-09, MW-10, MW-24

56 Ex A2 at MW-03 & MW-08

57 Ex A2 at MW-10

58 Ex A4 at MW-09

59 Ex A4 at MW-10

60 Ex A4 at MW-24

61 Endeavour Coal at [64]

62 Endeavour Coal at [62]

63 Mt Arthur’s final written submissions dated 10 December 2020 at [154]

Association of Professional Engineers, Scientists and Managers, Australia v Mt Arthur Coal Pty Ltd

[2021] FWC 356

25 JANUARY 2021

DECISION

Bargaining orders sought by APESMA