Australian Salaried Medical Officers Federation v Commonwealth of Australia as represented by the Department of Human Services

[2011] FWA 5920

[2011] FWA 5920

FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.238 - Application for a scope order

Australian Salaried Medical Officers Federation
v
Commonwealth of Australia as represented by the Department of Human Services
(B2011/3260)

SENIOR DEPUTY PRESIDENT DRAKE SYDNEY, 20 OCTOBER 2011

Inclusion of medical advisers in agency agreement considered to be inappropriate - currently covered by separate agreement.

[1] I heard this application in Canberra on 18 August 2011 and in Melbourne on 19 August 2011.

[2] The Australian Salaried Medical Officers Federation (ASMOF), on behalf of 29 members, sought an order pursuant to s.238 of the Fair Work Act 2009 (the Act). The application was said to be urgent because of an imminent vote by employees of the Commonwealth of Australia employed by the Department of Human Services (Human Services).

[3] The Grounds, Particulars and Other Circumstances identified in ASMOF’s application are set out below:

“2.Grounds

2.1. Australian Salaried Medical Officers Federation is maintaining that the proposed agreement cover the following group of employees:

Medical advisers employed by the Department [The medical advisers were, prior to 1 July 2011, employed by Medicare Australia and by Centrelink]

2.2 The Applicant has concerns that bargaining for the proposed collective agreement is not proceeding efficiently or fairly because the agreement will cover employees that it is not appropriate for the agreement to cover.

3. Particulars:

[By reference to the operational, geographical and/or organisational location of the employees referred to in paragraph 2.1 and of other employees the Applicant contends should be covered by the agreement, identify how the agreement will not cover appropriate employees, or will cover employees that it is not appropriate for the agreement to cover.]

(a) All Medical Advisers are a discrete class of employees who are identified by way of their professional qualifications and who are required to be registered medical practitioners.

(b)Currently, all Medical Advisers are covered by a separate agreement, the Medicare Australia (Medical Officers) Collective Agreement 2008-2011, which agreement has an expiry date of 5 December 201 I.

(c) Under s23DKA of the Health Insurance Act 1973 only medical advisers have the power to demand production of clinical records and, under section 129AAD of the Health InsuranceAct 1973, any requirement to produce documents relating to a medical service has to be based upon the advice of a medical adviser;

(d) The Department's predecessor, the Health Insurance Commission, regarded Medical Advisers as Senior Executive Service equivalent;

(e) Under the existing agreement Medical Advisers have terms and conditions namely, salary advancement by way of salary bands, private plated motor vehicle or allowance in lieu, car parking space, mobile phone for official purpose and reasonable incidental personal use, airline lounge membership and accommodation at Senior Executive Service standards, which are not available to other employees. The Department proposes that that such terms and conditions be removed without a commensurate increase in salary.

4. The Applicant contends that the proposed agreement should cover the following employees:

Medical Advisers employed by Department of Human Services.

5. The Applicant has met, or is meeting, the good faith bargaining requirements?

[X] Yes

[ ] No

6. Set out other circumstances, if any, relevant to whether it is reasonable to make the order sought:

(a) The employer wishes to include all medical advisers into a single agreement which includes all employees of the Department. The medical advisers wish to be covered by a separate agreement, as they presently are. In forcing them into such an agreement the group has not been fairly chosen

(b) The medical advisers are an operationally and organisationally distinct group which is readily identified by reason of their professional qualifications and registration.”

[4] Human Services did not contest the matters set out in s.238(1) or (2). It did contest that Fair Work Australia (FWA) could be satisfied as to the matters set out in s.238(3) and s.238(4):

“238 Scope orders

Bargaining representatives may apply for scope orders

(1)  A bargaining representative for a proposed single-enterprise agreement may apply to FWA for an order (a scope order ) under this section if:

(a)  the bargaining representative has concerns that bargaining for the agreement is not proceeding efficiently or fairly; and

(b)  the reason for this is that the bargaining representative considers that the agreement will not cover appropriate employees, or will cover employees that it is not appropriate for the agreement to cover.

......

Bargaining representative must have given notice of concerns

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

(a) has given a written notice setting out the concerns referred to in subsection (1) to the relevant bargaining representatives for the agreement; and

(b) has given the relevant bargaining representatives a reasonable time within which to respond to those concerns; and

(c) considers that the relevant bargaining representatives have not responded appropriately.

When FWA may make scope order

(4) FWA may make the scope order if FWA is satisfied:

(a) that the bargaining representative who made the application has met, or is meeting, the good faith bargaining requirements; and

(b) that making the order will promote the fair and efficient conduct of bargaining; and

(c) that the group of employees who will be covered by the agreement proposed to be specified in the scope order was fairly chosen; and

(d) it is reasonable in all the circumstances to make the order.

Matters which FWA must take into account

(4A) If the agreement proposed to be specified in the scope order will not cover all of the employees of the employer or employers covered by the agreement, FWA must, in deciding for the purposes of paragraph (4)(c) whether the group of employees who will be covered was fairly chosen, take into account whether the group is geographically, operationally or organisationally distinct.

Scope order must specify employer and employees to be covered

(5) The scope order must specify, in relation to a proposed single-enterprise agreement:

(a) the employer, or employers, that will be covered by the agreement; and

(b) the employees who will be covered by the agreement.

Scope order must be in accordance with this section etc.

(6) The scope order:

(a) must be in accordance with this section; and

(b) may relate to more than one proposed single-enterprise agreement.

Orders etc. that FWA may make

(7) If FWA makes the scope order, FWA may also:

(a) amend any existing bargaining orders; and

(b) make or vary such other orders (such as protected action ballot orders), determinations or other instruments made by FWA, or take such other actions, as FWA considers appropriate.”

[5] After hearing evidence from Dr Lever for ASMOF and Mr Ryan and Ms Cameron from Human Services, and considering the submissions of the parties, I was satisfied that the medical officers represented by ASMOF should be excluded from the proposed agreement which was due to be voted on by Human Services employees on 28 August 2011. I issued an order 1 to that effect on 22 August 2011.

[6] I do not consider it to be a critical issue, but because the parties spent some time addressing it, it is probably necessary that I indicate that I am satisfied that the medical officers have not, and never have been, employed as part of the Senior Executive Service (SES). At all times the relevant medical officers have been employed at a senior executive level with terms and conditions of employment not available to other employees at lower levels, but which terms and conditions were particularly applicable to them. Many of these conditions are conditions enjoyed by members of the SES and are unlikely to be contemplated as applicable to the vast majority of the just under 37,000 employees of Human Services.

[7] From 2000 to 2008 the medical officers were employed on Australian Workplace Agreements. From 2008 to date the medical officers have been employed pursuant to the Medicare Australia (Medical Officers) Collective Agreement 2008-2011 (the present Agreement).

[8] Human Services is a conglomerate of previous departments and institutions, bringing together a number of disparate groups under one umbrella. It is the preference of Human Services to have one agreement for all of those persons employed under their umbrella. They have remained as committed to that preference as ASMOF has been opposed to it.

[9] It is clearly the preference of the Australian Public Service, when negotiating agreements, to have one agreement per agency where appropriate. I have considered the document entitled The Australian Public Service Bargaining Framework, Supporting Guidance, a document issued in January 2011. 2 Whilst the Framework guides Human Services in its negotiations it is not legislation. The Framework is an internal policy guideline for negotiating agencies published by the Australian Public Service. I have set out below a relevant extract:

“1.2 Non-SES employees' terms and conditions

1.2.1 It is Australian Government policy that terms and conditions for non-SES employees be negotiated separately by each agency in an enterprise agreement made under the Fair Work Act.

One non-SES enterprise agreement per agency

1.2.2 It is Australian Government policy that agencies should seek to cover all of their non-SES employees in one enterprise agreement per agency, other than in exceptional circumstances with the agreement of the Prime Minister and the Special Minister of State for the Public Service and Integrity.

1.2.3 Agencies considering multiple enterprise agreements to accommodate distinct groups within the agency should therefore consult with the APSC in the first instance to determine whether the proposed arrangements are consistent with the APS Bargaining Framework.

1.2.4 While there are some distinct operational groups where it is appropriate to apply separate terms and conditions (for example, groups with specialist skills differentiated from the broader agency to which they are attached), these cases would be the exception rather than the norm. Agencies are not to enter into multiple collective agreements where doing so would lead to a harsh or oppressive result for the employees concerned, or for the purposes of providing inferior terms and conditions to any group of employees.

Determinations and common law agreements

1.2.5 For non-SES employees, a determination or a common law agreement is not a satisfactory alternative to an enterprise agreement to set terms and conditions in the medium to long term. However, it may be necessary for short-term, interim periods (such as following the establishment of a new agency) to use a determination or common law agreements to set terms and conditions of employment while an enterprise agreement is negotiated. Agencies who consider that they would not be able to conclude negotiations for an enterprise agreement within twelve months should contact the APSC to discuss their options.

1.2.6 Agencies who wish to provide for terms and conditions for employees in addition to those available under an enterprise agreement should utilise a flexibility term, as described under Part 1.3, rather than a determination or common law agreement.

1.2.7 Further information on the use of determinations and common law agreements is

available for agencies from the APSC.”

(My emphasis)

[10] It is clear that Human Services can enter into separate agreements without going outside the Public Service Guidelines. Separate agreements are contemplated but they are to be exceptions. In its negotiations with ASMOF Human Services has not agreed to a separate agreement.

[11] ASMOF’s members have been unswervingly committed to their demand for a separate agreement from the commencement of negotiations and ASMOF has made that known to the bargaining representatives for Human Services, in writing and in meetings, right up to its final written notice of 3 August 2011.

[12] In its correspondence of 20 August 2010 ASMOF stated:

“I note that Medicare Australia (Medical Officers) Collective Agreement 2008-2011 will not expire until 5 December 2011. ASMOF seeks your assurance that, having regard to the position of medical advisers within Medicare Australia, approaching the expiry of the present collective agreement, Medicare Australia will negotiate a new collective agreement with doctors.” 3

[13] In correspondence dated 16 September 2010 Human Services replied:

“As you may be aware the portfolio wishes to establish a single enterprise agreement covering all employees, to reflect the way human services agencies will work collaboratively into the future.” 4

[14] By letter dated 28 January 2011 ASMOF stated:

“ASMOF is prepared to enter into negotiations for a new collective agreement to replace the existing collective agreement. ASMOF believes that the existing agreement should be used as a basis for a new collective agreement covering medical officers..... I would be happy to meet with you to progress discussions for a new Agreement.” 5

[15] By letter dated 1 March 2011 ASMOF stated:

“Thank you for the opportunity to meet with you and Narelle Cameron on 16 February 2011.

Since that meeting we have had the opportunity to consult with our member doctors working for Medicare and Centrelink. The doctors have very clearly expressed the view that they wish to negotiate a new collective agreement covering just doctors.

In the meeting you expressed a preference that Medicare Australia wished to negotiate just one collective agreement going forward.

We are aware of the government's recently released Public Service Bargaining Framework. Clause 1.2.4 of the Bargaining Framework Support Guidance specifically provides for a separate collective agreement where there are distinct operational groups, for example groups with specialist skills different from the broader agency to which they are attached.

Of course it hardly needs saying that while such a document is an expression of policy, it is not law. The prevailing law is, of course, the Fair Work Act 2010 and Part 2.4 of the Act does not confine enterprises to negotiating only one collective agreement. In any dispute the Act would prevail. It would fall to Fair Work Australia to resolve any dispute.

ASMOF believes that the Medical Advisers do constitute a distinct operational group because:

• Medical Advisers have been employed by Medicare Australia (previously Health Insurance Commission) to provide high level professional advice to the organisation and to interact with the medical profession (individual providers, professional organisations, legal representatives, etc,) on complex professional matters such as matters of compliance and, in particular, in relation to the Professional Services Review Scheme.



• Because Medicare Australia is an organisation which administers the provision of health care to Australians, it is important to the organisation to employ high level professionals with medical qualifications and experience in order to function effectively. This was well recognised by the Health Insurance Commission which regarded Medical Advisers as SES equivalent. The first AWA resulted in recognition of their SES status. At that time, upgrades (e,g. M03 to M04) were discussed. This did not occur, but conditions well above the same Medical Officer classification grade in other public service departments were attained, including the SES status mentioned above. This was in recognition of the high level professional skills necessary for the duties performed by the Medical Advisers. Their role requires that they have had experience of private medical practice, be up-to-date with medical developments and have the necessary standing to speak authoritatively with other medical practitioners and organisations.



• Medical Advisers, with their high leve1 professional skills and functions, do not fit into the existing bureaucratic classification structures and to force them into the "one glove fits all" philosophy may well prove to be detrimental to the organisation. If ever there was a group with specialist skills different from the broader agency to which they are attached deserving a separate agreement, it surely must be the Medicare Australia Medical Advisers.



• The fact that there is already in place a Medicare Australia (Medical Officers) Collective Agreement 2008-2011 reinforces the contention that the doctors are a group with specialist skills different to the broader agency.




The existing Medicare Australia (Medical Officers) Collective Agreement 2008-2011 runs until 5 December 2011.

As I indicated in my letter of 28 January 2011 ASMOF is prepared to enter into negotiations for a new collective agreement to replace the existing collective agreement. ASMOF believes that the existing agreement should be used as a basis for a new collective agreement covering medical officers. Using the existing agreement as a template would mean that, provided agreement is reached on key terms and conditions, those negotiations should be able to be completed within a relatively short time frame.

I request that you take any necessary steps within government to allow to negotiation of a separate collective agreement for Medical Advisers.

I would be happy to meet with you to progress discussions for a new Agreement.” 6

(My emphasis)

[16] The email of 3 August 2011, the final correspondence from ASMOF to Human Services regarding this issue, was attached to the application and is set out below:

“Thank you for your email of 2 August 2011.

Your email makes it clear that we are now in dispute about which employees the proposed agreement should cover.

We have proposed that there be an agreement which should cover just Medical Advisers. You have rejected this proposal and counter-proposed that any agreement cover all employees of the Department of Human Services.

Your counter-proposal is inappropriate because it does not reflect the special role performed by Medical Advisers, will lead to Medical Advisers performing similar work being treated differently and departs from historical practice.

I have concerns that requiring Medical Advisers to be included in an agreement with all other employees of the Department would:

• Not reflect their role as a discrete class of employees who are identified by way of their professional qualifications and registration;



• Not reflect their special role specified under sections 23DKA and 129AAD of the Health Insurance Act 1973;



• Not reflect historic practice whereby the Department's predecessor, the Health Insurance Commission, regarded Medical Advisers as Senior Executive Service equivalent;



• Not reflect historic practice whereby Medical Advisers have been and are currently the subject of a separate agreement, the Medicare Australia (Medical Officers) Collective Agreement 2008-2011; and



• Remove from Medical Advisers certain existing terms and conditions namely, salary advancement by way of salary bands, private plated motor vehicle, car parking space, mobile phone for official purpose and reasonable incidental personal use, airline lounge membership and accommodation at Senior Executive Service standards, without a commensurate increase in salary.




I request a written response by 12 noon on Monday 8 August 2011 which either withdraws you counter-proposal or else provides a full explanation as to why you think our proposal is inappropriate, and why your counter-proposal is fair to employees (as required by section 228(d) of the Fair Work Act 2009).”  7

(My emphasis)

[17] Mr Vane-Tempest for Human Services submitted that this final correspondence from ASMOF did not meet the written notice requirements of the Act:

“We say, your Honour, that the email from Mr Arthur to Ms Chapman of 3 August, which refers to Ms Chapman’s email of 2 August, does not in fact meet the requirements of the written notice setting out concerns that bargaining is not proceeding efficiently or fairly, and the reason for that not being the case is that the bargaining representative considers the agreement will not cover appropriate employees.” 8

[18] He said that it was:

“We say, when properly reviewed, that that email simply discloses the fact that ASMOF remains in dispute with the department about the coverage of the agreement and sets out some concerns, not in respect of how bargaining is actually proceeding, efficiently or fairly or otherwise, but simply concerns as to the outcomes that will apply to medical advisers. We say that the first hurdle hasn’t been crossed.”  9

[19] I was satisfied that ASMOF had satisfied the requirements of s.238(3)(a) in that the bargaining representative had given written notice of the concerns referred to in s.238(1) to the relevant bargaining representatives. That correspondence demonstrated genuine concerns that bargaining was not proceeding efficiently or fairly and very clearly articulated that the proposed agreement would cover employees that it was not appropriate for the agreement to cover.

[20] Having regard to s.238(3)(b) I was satisfied that the lodgement of the application on 9 August 2011 provided a reasonable time within which Human Services could respond to ASMOF’s concerns. This is partly because the concerns were not new. Nothing was contained in the notice which could take Human Services by surprise. Also, having reviewed the material, I was satisfied that if I issued the order sought the vote could proceed in any event without impediment, subject to some reasonably simple amendments to the document.

[21] Having regard to s.238(3)(c) I was satisfied that ASMOF, as the bargaining representative making this application, considered that the relevant bargaining representative had not responded appropriately.

[22] Having regard to s.238(4)(a) and having considered the history of meetings, the correspondence evidenced by the statements and oral evidence of all witnesses, I was satisfied that the applicant bargaining representative had met and was meeting the good faith bargaining requirements.

[23] Having regard to s.238(4)(b) I was satisfied that the order would promote the fair and efficient conduct of bargaining for a number of reasons.

[24] I consider that these 29 medical officers are a discrete group of professionals amongst the just under 37,000 employees proposed to be covered by the Human Services agency agreement. The employees have had and still have high level conditions comparable to those enjoyed by the SES. Their conditions have always been superior conditions aimed at attracting and retaining the services of medical professionals. I was satisfied that the ability of these particular employees to bargain fairly and efficiently regarding their conditions in the face of any community of interests with the vast number of employees on ordinary classifications, who would have no interest in maintaining the conditions of the medical professionals, was nil. I was satisfied that these employees would be unable to bargain fairly and efficiently whilst they were obliged to be part of a bargaining group with which they had no common interests and who had no interest in assisting them to maintain their conditions. I was not satisfied that the general benefit of one agency agreement “reflecting collaboration” within the agency offset the difficulties for these particular employees who I considered to be “an operationally and organisationally distinct group which is readily identified by reason of their professional qualifications and registration.” 10

[25] Human Services has many occupational and professional groupings within its massive workforce. I have considered these groupings. I concluded that the fact that there were other professional subgroups who did not appear to perceive themselves as being adversely affected by inclusion in the agency agreement or, if they did see themselves as being adversely affected, have not made an application, should not affect my determination in relation to these particular employees. This was the application before me and these employees, their conditions and their ability to bargain fairly and efficiently were what I had to consider. I was satisfied that without the scope order the relevant medical officers would suffer and that bargaining would proceed more fairly and efficiently if the order was made.

[26] Having regard to s.238(4)(c) I was satisfied that the group of employees who were specified in the scope order were fairly chosen. These are a discrete group of employees who have a history of separate coverage and are in fact still covered by a separate agreement. There seems to me to be no identifiable benefit except the hobgoblin of consistency to justify the inclusion of these medical officers in a whole of agency agreement. There were many circumstances that were outlined by ASMOF in its correspondence with Human Services and which have been extracted in this decision, but which I do not intend to repeat, which I found supported my conclusion that this group of employees should be allowed to bargain as a discrete group for a separate agreement. I was satisfied that they had been fairly chosen.

[27] Having regard to all of those matters which I have considered in this decision, particularly those matters already dealt with pursuant to s.238(4)(a), (b) and (c), I was satisfied pursuant to s.238(4)(d) that it was reasonable in all the circumstances to make the order and I did so.

SENIOR DEPUTY PRESIDENT

 1   Print 513710 and Correction Order PR513880.

 2   Exhibit ASMOF 1, attachment 8.

 3   ASMOF letter of 20 August 2010.

 4   Department of Human Services/Medicare letter of 16 September 2010.

 5   ASMOF letter of 28 January 2011.

 6   ASMOF letter of 1 March 2011.

 7   Email of Wayne Arthur, ASMOF Industrial Officer dated 3 August 2011.

 8   Transcript PN95.

 9   Transcript PN96.

 10   The application.

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