Australasian Meat Industry Employees' Union v Coles Supermarkets (Australia) Pty Ltd

[2014] FWC 8868

[2014] FWC 8868 [Note: An appeal pursuant to s.604 (C2014/8432) was lodged against this decision - refer to Full Bench decision dated 30 January 2015 [[2015] FWCFB 379] for result of appeal.]

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.437—Protected action

Australasian Meat Industry Employees’ Union

v

Coles Supermarkets (Australia) Pty Ltd
(B2014/1576 and B2014/1607))

COMMISSIONER GREGORY MELBOURNE, 17 DECEMBER 2014

Coles Supermarkets Australia Pty Ltd - Australasian Meat Industries Employees’ Union - Proposed protected action ballots of employees of Coles Supermarkets (Australia) Pty Ltd.

Introduction

[1] The Victorian and Tasmanian branches of the Australasian Meat Industry Employees’ Union (“AMIEU”) have made separate applications for protected action ballot orders. They have been made in the context of negotiations that have been taking place since April this year between Coles Supermarkets Australia Pty Ltd (“Coles”) and various Unions about the establishment of a new enterprise agreement to cover all of Coles’ non-salaried employees who work in its supermarkets, including those employees who work in the meat departments. This decision deals with both of those applications.

[2] There is no dispute between the parties that the various requirements of s.437 of the Fair Work Act 2009 (Cth) (“the Act”) have been met. It is also clear that the restriction on making an application in s.438 of the Act does not apply. The employees in Victoria and Tasmania who are to be the subject of the ballot are covered by two separate State-based Agreements. The nominal expiry date of the existing Coles Supermarkets & AMIEU Tasmania Meat Agreement 2011 1, which covers the meat workers in Tasmania, is 30 June 2014. The nominal expiry date of the Coles Supermarkets Australia Pty Ltd & AMIEU Victorian Meat Agreement 20112, which covers the meat workers in Victoria, is 31 August 2014.

[3] However, Coles opposes the applications on the basis that the requirement in s.443 of the Act has not been satisfied. It submits that the Commission is not in a position to be able to find that the separate branches of the AMIEU are genuinely trying to reach agreement with Coles in respect of the employees who are intended to be balloted.

[4] It is noted by way of background that meat workers employed by Coles have traditionally been covered by separate stand alone State-based agreements, apart from those in Queensland and the Northern Territory, who have been covered by an agreement that also covers other supermarket employees.

[5] The matter was initially heard on 20 November 2014. At the conclusion of that hearing the Commission indicated it intended to reserve its decision in order to give further consideration to the submissions and evidence before handing down a decision. However, on 24 November the Commission was contacted by the AMIEU’s National Industrial Officer, who indicated the AMIEU now wished to provide further witness evidence from Mr Graham Smith, the Federal Secretary of the AMIEU. That request was not opposed by Coles, on condition that it was given the opportunity to provide evidence and submissions in response, and a further hearing was then held on 8 December.

[6] Mr Chris Gardner was granted leave to appear on behalf of Coles under s.596(2)(a) on the basis that the matter involved a degree of complexity and his involvement might assist in dealing with it more effectively.

[7] It is also noted that a range of evidence and submissions were provided about the circumstances involved in this matter. I have had regard to all of that material in coming to a decision. However, I have confined the references in this decision to the evidence and submissions I consider relevant to the determination of the matter.

The Evidence and Submissions

[8] Mr Paul Conway is the Secretary of the Victorian branch of the AMIEU. He stated that Coles informed the AMIEU earlier this year that it wanted to negotiate and put in place a national retail agreement to apply to all supermarket employees, including those employed in the meat departments. Mr Conway indicated that he has since attended 18 separate bargaining meetings since April 2014. He also indicated that the various Unions involved in the negotiations, including the AMIEU, have provided detailed logs of claim to Coles during the course of those bargaining processes.

[9] He said Coles has made it clear from the outset it wished to put in place a single, national retail agreement that would cover “the four walls” of its supermarkets. He said the AMIEU’s Federal Executive and the Victorian branch of the Union had considered their position in response, and the consensus was a preference to maintain separate State-based agreements. It was considered the establishment of a national agreement had the potential to threaten the existence of the more favourable employment conditions that now apply to meat department employees.

[10] He also stated that the Federal Executive later decided that one possible option would be to propose a single national agreement to cover meat department employees. This proposal was put forward on the basis that it could enable the AMIEU to maintain a separate agreement for meat department employees, but at the same time allow Coles to move towards the establishment of a uniform framework of terms and conditions for those employees in all parts of Australia. He said that the AMIEU had made it clear throughout the negotiations that its preference was to maintain its existing State-based agreement structure, but that it would be prepared to accept a national agreement if it were confined to the employees in the meat departments. He said Coles consistently maintained in response that it did not want a national stand-alone meat agreement, but wanted instead a single, national agreement covering all supermarket store employees, including those working in the meat departments.

[11] Mr Conway said the AMIEU made application for a scope order in September 2014 as part of its attempts to get Coles to negotiate a separate national meat agreement. He said Coles continued to make clear it would not agree to negotiate a national meat agreement under any circumstances. He said that in a bargaining meeting that was held on 5 November he therefore told the Coles representatives that in all the circumstances the Victorian branch of the AMIEU would revert to its original and preferred position of pursuing a State-based agreement for meat department employees in Victoria. 3

[12] Mr Troy Baker is the Secretary of the Tasmanian branch of the AMIEU. He also said Coles had informed the AMIEU earlier this year that it wanted to negotiate a national retail agreement to apply to all supermarket employees. He has subsequently participated in all of the negotiating meetings with Coles. He also stated that the Tasmanian branch of the AMIEU has advised Coles that its preference was to maintain State-based agreements, but it was prepared to consider a national agreement to cover meat department employees only. However, this proposal has been consistently rejected by Coles, and in the recent meeting on 5 November he had also advised Coles that the Tasmanian branch of the AMIEU would now be seeking to maintain a stand alone State-based agreement.

[13] Mr Graham Smith is the Federal Secretary of the AMIEU. He said he has attended all of the meetings that have taken place about the negotiation of a new enterprise agreement, apart from one recent meeting that he was unable to attend. He stated that the “AMIEU initially adopted a position in the negotiations that it wished to maintain the separate enterprise agreements that it previously negotiated to cover employees in Coles supermarket meat departments within the geographical confines of a particular state.” 4 However, he said the AMIEU subsequently decided that it would be prepared to consider negotiating a national agreement to cover employees in the meat departments in supermarkets, providing agreement could be reached on the terms and conditions to be contained in that agreement.

[14] He said the AMIEU made application for a scope order in September in order to try and require Coles to negotiate a national meat agreement. He also indicated he was not present at the bargaining meeting on 5 November, but it had been decided that the AMIEU’s representatives at that meeting would tell Coles that because it refused to agree to a national meat agreement the AMIEU would now revert to its original position of support for continuing to have State-based agreements in place.

[15] He said that he attended a further bargaining meeting on 24 November. During the course of that meeting he asked Coles to confirm its position in relation to the AMIEU’s claims for State-based enterprise agreements to cover meat department employees. He stated that Coles indicated in response it would give consideration to the Union’s log of claims, but at this stage had not changed its position in regard to the establishment of a single nationwide agreement to cover all supermarket store employees. He said that Coles also indicated at this meeting it was not in a position to respond to the AMIEU’s log of claims, but might be in a position to respond at some later stage.

[16] Mr Smith said the Coles’ representatives asked some further questions about the AMIEU’s log of claims at this meeting. He also confirmed that while the AMIEU had decided to maintain its structure of State-based agreements, it was still prepared to consider an outcome that involved a national agreement covering meat department employees only. He also stated that Coles did not provide any definite indication about when it would respond to the AMIEU’s logs of claims based around separate State agreements for meat department employees.

[17] Mr Smith also stated that he was unable to attend the most recent bargaining meeting held in Sydney on 1 December 2014. However, he had been told afterwards by the AMIEU representatives who were present at the meeting that Coles and the Shop Distributive and Allied Employees’ Association (“SDA”) had indicated that an “in principle” agreement had been reached between them. Mr Smith also said the AMIEU’s representatives had again been told by Coles that it would not enter into State-based agreements with the AMIEU.

[18] The AMIEU submits that in these circumstances the Commission can be satisfied it is genuinely trying to reach an agreement with Coles. It relies, in particular, on the decision in Maritime Union of Australia v Swire Pacific Ship Management (Australia) Pty Ltd 5(“Swire”), and submits it is authority for the proposition that pursuit of a scope order does not mean the bargaining representative is not “genuinely trying to reach agreement.”

[19] It also submits there is no evidence to indicate the applications are motivated by some other purpose, and s.443 of the Act should be considered on the basis of its plain and ordinary meaning, without seeking to import or make it subject to other provisions of the Act. In its submission the AMIEU has made its position clear in the negotiations with Coles about “the general ambit of what is being sought and the consistent answer has been no.” 6

[20] Ms Lauren Murphy is employed by Coles in the position of Employee Relations Manager – Retail, Human Resources. She said she has been one of the lead negotiators in the recent bargaining meetings that have taken place since April of this year, and has attended all of those bargaining meetings.

[21] She stated that on 7 April 2014 Coles provided notice to the AMIEU and 3 other Unions that it intended to commence negotiation for a new enterprise agreement covering all supermarket team members nationally. She described this as the “Store Team Agreement” and stated that negotiations about that agreement have continued since 22 April.

[22] Ms Murphy said the Federal Secretary of the AMIEU indicated in the initial meeting on 22 April that the AMIEU wanted to maintain the “status quo,” but was not in a position to present a log of claims at that stage. However, Mr Smith subsequently presented the Union’s log of claims at a meeting on 2 June 2014. Those claims indicated that the Union was prepared to agree to the creation of a single meat department agreement which would apply nationally to all meat workers within Coles Supermarkets. She also stated that Mr Smith indicated the AMIEU had been very defensive of its State-based arrangements, but was prepared to consider a single agreement for meat department employees. However, it would not agree to a single national agreement covering all supermarket store employees. She also stated that in that discussion Mr Smith proceeded to go through each of the Union’s 67 claims. Further additional claims were also discussed in other subsequent meetings.

[23] She said the AMIEU then made application for the scope order on 1 September 2014. Further discussions about the AMIEU log of claims then continued during the subsequent bargaining meetings in September and October. She stated that a number of matters were agreed upon even though the AMIEU continued to press for a national agreement covering meat department employees, while Coles remained committed to a national agreement covering all employees.

[24] Ms Murphy also made reference to a conversation that took place in the meeting on 5 November 2014, after the Coles’ representative indicated Coles continued to seek a single “Store Team Agreement”, which would include meat department team members. She stated that Mr Conway, the Victorian Branch Secretary of the AMIEU then indicated that the States of Tasmania, Victoria and Queensland were reverting to their original position of support for State-based agreements. However, at this point the application for a scope order remained in place and had been set down for hearing in December.

[25] Ms Murphy provided a supplementary witness statement following the witness evidence provided by Mr Smith. She stated that at the bargaining meeting on 24 November Coles indicated it had some questions for Mr Smith about the 4 State-based logs of claim provided to Coles after the conclusion of the bargaining meeting on 19 November. She said Mr Smith advised the Coles representative that the matters would now need to be discussed with each of the relevant State officials, as they were now matters for each State Branch of the AMIEU to consider. She also indicated that in the meeting on 1 December Coles advised the AMIEU representative, Mr Donzow, that the AMIEU claim for State-based agreements was rejected. She also stated that an in-principle agreement has now been reached between Coles and two of the Unions. She also indicated in cross examination that Coles was not in a position to agree to the current AMIEU log of claims.

[26] The submissions provided on behalf of Coles made reference to various grounds in support of its view that the protected action ballot order should not be made. These included submissions related to the application for a scope order made by the AMIEU in September. However, Coles indicated that the withdrawal of that application on the day prior to the hearing meant Coles no longer pressed its submission that the application should be dismissed under s.587 of the Act.

[27] Coles also foreshadowed a submission suggesting an order not be made unless an application has been made under s.437 in relation to a proposed enterprise agreement, although it also acknowledged the decision of the Full Bench in Swire is on point and came to a contrary view.

[28] Coles finally submits that the question of whether the AMIEU has been genuinely trying to reach agreement is required to be satisfied in respect of the establishment of the specific Victorian and Tasmanian State-based agreements. It also submits this must be occurring as at the date of the application, “otherwise applications could be made on a wholly pre-emptive and speculative basis.” 7 In this context it relies on the decisions in National Union of Workers v SKF Australia Pty Ltd8 and National Union of Workers v Phillip Leong Stores Pty Ltd9.

[29] In terms of the principles to be applied in relation to “genuinely trying to reach an Agreement” Coles relies on the Full Bench decision in Total Marine Services v Maritime Union of Australia 10 (“Total Marine Services”) and the decision in Swire. It submits that several principles can be extracted from those decisions.

[30] Firstly, it is a question of fact to be decided on the material before the Tribunal. Secondly, the Applicant must be able to demonstrate it has clearly articulated the major items it is seeking, and has provided a considered response to the demands from the other side. In this context it is necessary to have provided claims to the other party, but also to have obtained a response to those claims. In this context Coles made reference to various examples, including decisions in which there had only been one meeting between the parties, and another in which it was found there had been a failure to elicit or ascertain a response from the employer.

[31] Coles also made reference to the Full Bench decision in JJ Richards & Sons Pty Ltd v Fair Work Australia 11(“JJ Richards”) in terms of the requirement for the Commission to be satisfied that the applicant for a protected action ballot order has been and is genuinely trying to reach an enterprise agreement in circumstances where the Federal office and the State Branch of a Union are both involved. Coles submits that the Commission must be satisfied in those circumstances that the applicant for the protected action ballot order has been genuinely trying to reach an agreement with the employer.

[32] Coles submits, in summary, that the evidence demonstrates the AMIEU has been, until very recently, pursuing a national meat agreement to cover all meat department employees in Coles Supermarkets. This approach was confirmed by the making of the scope application, despite it having been recently withdrawn. It submits in conclusion that the recent pursuit of State-based agreements “does not satisfy the genuineness requirement because the claims have not been sufficiently advocated.” 12

Consideration

[33] As indicated, both parties have made reference to various authorities, including Swire, Total Marine Services and JJ Richards, and to the principles that have been established in these decisions. In this context I have had particular regard to the decision of the Full Bench in Swire and, in particular, the extracts from that decision at [57] to [63] which commence under the heading “Authorities on genuinely trying to reach an Agreement.” 13 I am satisfied they provide an accurate review of the authorities and a description about how the issue of “genuinely trying to reach agreement” has developed with the passage of time in the various decisions referred to in those paragraphs.

[34] I refer in particular to the extract that is referred to from the judgement of Flick J in the decision of the Full Court of the Federal Court in JJ Richards when His Honour said:

“It is ultimately concluded that s 443(1)(b) is to be construed such that Fair Work Australia cannot reach a state of satisfaction that an “applicant ... is ... genuinely trying to reach an agreement with the employer” unless:

• an applicant has approached the employer and informed the employer of the general ambit of that for which agreement is sought; and



• the employer has foreshadowed – even in the most general of terms – its attitude as to the proposed agreement.

More may be required. Much may well depend upon the factual scenario in which the terms of s 443 (1)(b) are to be applied. But such a minimum statement of that which is required is sufficient to dispose of the present Application. Contrary to the submissions advanced on behalf of the Applicants, the terms of s 443 (1)(b) do not require:

• bargaining to have commenced within the meaning of and for the purposes of s 173, found within Pt 2-4 of the Fair Work Act.

So much, it is concluded, follows from the natural and ordinary meaning of the phrase “try to reach an agreement ...”. It is difficult to conclude that any person can try to reach an agreement with another in the absence of a disclosure of that for which consensus is sought. One person may wish to reach an agreement with another. But, until the general content of the proposed agreement is disclosed, it cannot be said that he has even attempted to reach an agreement. Until disclosed, it is not known whether the other person will readily embrace the proposed agreement or shun it or (perhaps) embrace the concept of an agreement but wish to vary one or other of its terms. Until disclosed, the person seeking agreement has not even tried to solicit the response of the other. Unless the disclosure is genuinely with a view to reaching agreement, it could well be said that the attempt to reach an agreement falls short of a person even trying to reach agreement. The addition of the word “genuine” – on one approach to construction – perhaps adds little. But the addition of that term serves to emphasise the importance of a person actually trying to solicit agreement. Until a proposed agreement has been disclosed to the prospective parties, and a response solicited, an applicant has not even tried to reach agreement – let alone genuinely tried to reach agreement.” 14

[35] I am satisfied, based on all the circumstances involved in this matter and the principles contained in the relevant authorities, that protected action ballot orders should be made as a consequence of the present applications. The following circumstances are of particular relevance in coming to this decision. The evidence of Ms Murphy indicates that Coles has embarked on a concerted strategy in this enterprise bargaining negotiation. It has decided to move away from the existing agreement structure that covers the employees in its supermarkets involving different agreements with different Unions, structured in some cases around State-based arrangements, and to move instead to a structure based on a single agreement that covers all of its supermarket store employees throughout Australia, described as the “Store Team Agreement.”

[36] In order to be able to work towards this objective Coles involved each of the Unions that are bargaining representatives for its employees in the supermarkets in the negotiations. In the case of the AMIEU it was, by its own admission, caught with its “pants down” 15 in being approached to get involved in these negotiations, given that its existing State-based Agreements were still to reach their nominal expiry dates. In some cases those Agreements do not reach their nominal expiry dates until well into 2015.

[37] The evidence of Mr Smith and Mr Conway indicates the AMIEU agreed to participate in these negotiations. However, I am also satisfied that their evidence indicates they did so from a starting point that the AMIEU wished to maintain the separate State-based agreement structure it had in place to cover employees in supermarket meat departments in all States, apart from Queensland. This was the AMIEU’s principal and preferred starting point in the negotiations, and it was made clear to the Coles representatives at the outset, as the evidence of Ms Murphy indicates.

[38] However, Mr Smith’s evidence, in particular, also indicates that in the face of a consistent and implacable position of support for a single national agreement from Coles, and as part of the AMIEU’s somewhat belated response to the negotiations initiated by Coles, the AMIEU attempted to develop a compromise position. The subsequent decision by its Federal Executive was to enter into negotiations concerning the establishment of a national agreement, but one that covered meat department employees only. This was proposed on the basis that it could enable the development of common conditions for meat department employees in all parts of the country, with the various States being covered by this agreement as their different State agreements reached their nominal expiry date. At the same time it would still mean that the AMIEU’s members were covered by a separate agreement.

[39] The evidence of Mr Smith, Mr Baker, and Mr Conway also describes the log of claims that were subsequently developed by the AMIEU. Ms Murphy’s evidence confirms that these claims were discussed in a meeting in June and at subsequent negotiating meetings. It also indicates that agreement was reached about some of these claims, despite the lack of any agreement about how a final agreement or agreements would be structured.

[40] Ms Murphy’s evidence also describes the scope application which was made by the AMIEU in early September, as part of its attempts to pursue its compromise proposal for a national meat department employee agreement. The evidence of Ms Murphy, Mr Conway, Mr Smith and Mr Baker also details the statements at the 5 November meeting from Mr Conway and Mr Baker about the fact that the State branches in Queensland, Victoria and Tasmania had now decided to revert to support for maintenance of the State-based agreement structure. A revised set of simplified claims were also provided at a subsequent meeting, with the Federal Secretary of the AMIEU indicating that discussions now needed to be held between Coles and the different State-based officials, given the reversion to support for a State-based agreement structure. The scope application still remained in place at this time, but was then withdrawn on the eve of the hearing on 20 November 2014.

[41] As indicated, I am satisfied that it is appropriate in all the circumstances for a protected action ballot order to be made. The evidence establishes that Coles was aware in April when the negotiations commenced that the “bottom line” preferred position of the AMIEU was for the “status quo” to be maintained. That involved separate State-based agreements. However, the blanket opposition by Coles to this outcome caused the AMIEU to cast around for other possible options. The proposal for a separate national agreement for meat department employees was that compromise option. However, in the face of continued and ongoing opposition to that proposal from Coles, the Victorian and Tasmanian State branches of the AMIEU reverted to their original position, being separate State-based arrangements.

[42] I am satisfied, in conclusion, in regard to the current applications from the Victorian and Tasmanian State branches of the AMIEU, that both can be considered to be genuinely trying to reach agreement. As indicated, the AMIEU was brought to the negotiating table ahead of time because of the outcome that Coles wanted to pursue. Its representatives, including its State Branch officials, made clear from the outset what their preferred position was in terms of the structure of any future agreements. That position involved the continuation of the existing State-based arrangements However, the Union also sought to develop a compromise position in order to try and satisfy the outcome that Coles wanted to have in place. Evidence also indicates that there were extensive discussions about the log of claims that the AMIEU representatives wanted to pursue, and those discussions took place aside from any considerations about the final structure of any such agreement. I am not satisfied that it can be said, in all those circumstances, that its State-based claims have not been sufficiently advocated.

[43] The evidence indicates that Coles was aware from the outset that the AMIEU’s preference was for State-based arrangements to continue. The evidence also indicates that there have now been a range of discussions about the matters the AMIEU would like contained in any agreement that is finally concluded. Its position has been clearly articulated and Coles has had the opportunity to provide a detailed response. Those discussions have taken place in numerous meetings over a period of almost nine months.

[44] As is the case in many negotiation processes the position of the parties has changed as part of the attempts to try and reach an agreed outcome. In the case of the AMIEU this has involved differences of position in terms of the final form and structure of any agreement, as well as a series of positions about the content of any such agreement. The original position put by the AMIEU was for the continuation of the existing State-based arrangements negotiated with the State Branches of the Union. The option of a single agreement negotiated with the Federal office was later proposed. The scope application was made as part of the process of trying to put that structure in place. However, that option was also rejected by Coles. As indicated, such changes and shifts in position are often part of the cut and thrust of an agreement negotiation as attempts are made to find a mutually agreed outcome.

[45] I am satisfied in all the circumstances that it is not open now to Coles to submit that it does not understand what the Applicants’ intend. There has been a process of negotiation that has now been playing out over a period of nine months. The recent developments in that evolving process should not now be construed as a new or separate step that needs to be fully articulated and explained before any negotiating parties are entitled to make application under s.437. I am also satisfied that this is not a situation in which Coles can be said to have not been provided with the opportunity to indicate its response to the claims by the AMIEU. The evidence indicates Coles has rejected a structure based around continuing State-based arrangements. The evidence also indicates that Coles has rejected the compromise position of a single national agreement for meat department employees. The evidence also indicates that the AMIEU’s log of claims has been discussed extensively since first provided to Coles in June. The nature of those claims has changed as well during the course of the negotiations as is to be expected in any prolonged negotiation process.

[46] I am also satisfied that the evidence demonstrates that the Applicants are genuinely trying to reach agreement. Separate representatives from the Victorian and Tasmanian State branches of the AMIEU have been involved in the negotiations with Coles since April. Each has made their position clear from the outset about their preferred outcome in terms of the structure of any future agreements. In more recent times they have reverted to that original position. I am accordingly satisfied it is a clear what agreements the ballots will be in relation to.

[47] I am satisfied, in conclusion, that protected action ballot orders should be made in respect of both applications. Those orders will be issued in conjunction with this decision and with effect from the same date.

COMMISSIONER

Appearances:

Mr Lee Norris appeared on behalf of The Australasian Meat Industry Employees Union.

Mr Chris Gardner of Seyfarth Shaw Australia appeared on behalf of Coles.

Hearing details:

2014.

Melbourne:

20 November and 8 December.

 1   AE888707

 2   AE890738

 3   Exhibit AMIEU1 at para 17

 4   Exhibit AMIEU3 at para 3

 5   [2014] FWCFB 2587

 6   Transcript at PN505

 7   Ibid PN569

 8   [2010] FWA 6557

 9   [2014] FWC 6459

 10   [2009] FWAFB 368

 11 [2012] FCAFC 53

 12   Outline of Submissions filed by Coles Supermarkets Australia, undated, at para 33.2

 13   Above n.v at [57]-[63]

 14   Above n.xi at [58]-[59]

 15   Transcript at PN47

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