Australian Workers' Union, The v ACI Operations Pty Ltd T/A Owens-Illinois Australia

[2017] FWC 4635

[2017] FWC 4635

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.437—Protected action

Australian Workers’ Union, The
v
ACI Operations Pty Ltd T/A Owens-Illinois Australia
(B2017/797)

DEPUTY PRESIDENT DEAN SYDNEY, 8 SEPTEMBER 2017

Proposed protected action ballot of employees of ACI Operations Pty Ltd t/as O-I Glass Sydney.

[1] ACI Operations Pty Ltd T/A O-I Glass (ACI) conducts a business within the glass manufacturing industry. Certain employees of ACI are covered by the O-I Sydney Glassworker Workplace Agreement 2013 (the Agreement). The nominal expiry date of the Agreement was 14 February 2016. The majority (if not all) of the employees covered by the Agreement are members of the Australian Workers’ Union (AWU).

[2] On 4 September 2017 the AWU made an application under s.437 of the Fair Work Act 2009 (Cth) (the Act) for a protected action ballot order (PABO) in relation to members of the AWU who are currently covered by the Agreement. On 5 September 2017, ACI advised the Commission that it opposed the PABO sought by the AWU.

[3] Having regard to the requirement for the Commission to, as far as practicable, determine an application for a PABO within two working days after the application is made, this application was heard on the afternoon of 6 September 2017.

[4] At the hearing, the AWU was represented by Mr G Symington, Industrial Officer of the AWU, and Mr G Fredericks of Counsel appeared, with permission, for ACI.

[5] Mr Ian Thomas, senior site delegate, gave evidence on behalf of the AWU in support of the application. A statutory declaration of Mr Paul Noack, AWU Official, also accompanied the application. Ms Marlaina Morley, Human Resources Manager, gave evidence on behalf of ACI.

[6] For the reasons set out below, I am satisfied that the requirements of s.443 of the Act have been met and so I must grant the AWU’s application for a PABO.

Relevant legislation

[7] Section 443(1) of the Act sets out the circumstances in which the Commission must make a PABO:

“443 When the FWC must make a protected action ballot order

(1) The FWC must make a protected action ballot order in relation to a proposed

enterprise agreement if:

(a) an application has been made under section 437; and

(b) the FWC is satisfied that each applicant has been, and is, genuinely trying

to reach an agreement with the employer of the employees who are to be

balloted.

(2) The FWC must not make a protected action ballot order in relation to a proposed enterprise agreement except in the circumstances referred to in subsection (1).”

Issue to be determined

[8] There is no dispute between the parties, and I am satisfied on the evidence, that:

(a) the PABO application was made by the AWU in accordance with s.437 of the Act; and

(b) the AWU has been genuinely trying to reach an agreement with ACI (being the employer of the employees who are to be balloted).

[9] The issue between the parties in relation to the PABO application that I need to determine is whether the AWU “is” genuinely trying to reach an agreement with ACI, within the meaning of s.443(1)(b) of the Act.

What does “is genuinely trying” mean?

[10] There have now been a number of decisions that have considered the meaning of “is genuinely trying”.

[11] The question of whether a bargaining representative has been and is genuinely trying to reach an agreement was considered in JJ Richards & Sons Pty Ltd v Fair Work Australia, where Flick J said: 1

“[58] 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 Part 2-4, of the Fair Work Act.

[59] So much, it is concluded, follows from the natural and ordinary meaning of the phrase “trying 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.

[60] The Transport Workers’ Union, in the present proceeding, satisfied that requirement by writing to J.J. Richards on 24 December 2010. Rightly or wrongly, J.J. Richards indicated its response in the terms it did in its letter dated 7 January 2011. That exchange of correspondence was sufficient to satisfy the precondition to the exercise of the power conferred by s 443(1).”

[12] In Total Marine Services Pty Ltd v Maritime Union of Australia 2, the Full Bench expressed the following views about s.443(1)(b):

“[31] In our view the concept of genuinely trying to reach an agreement involves a finding of fact applied by reference to the circumstances of the particular negotiations. It is not useful to formulate any alternative test or criteria for applying the statutory test because it is the words of s 443 which must be applied. In the course of examining all of the circumstances it may be relevant to consider related matters but ultimately the test in s 443 must be applied.

[32] We agree that it is not appropriate or possible to establish rigid rules for the required point of negotiations that must be reached. All the relevant circumstances must be assessed to establish whether the applicant has met the test or not. This will frequently involve considering the extent of progress in negotiations and the steps taken in order to try and reach an agreement. At the very least one would normally expect the applicant to be able to demonstrate that it has clearly articulated the major items it is seeking for inclusion in the agreement, and to have provided a considered response to any demands made by the other side. Premature applications, where sufficient steps have not been taken to satisfy the test that the applicant has genuinely tried to reach an agreement, cannot be granted.”

[13] The Full Bench in Esso Australia Pty Ltd v AMWU & Ors 3 made the following observations about the decision in Total Marine Services Pty Ltd v Maritime Union of Australia:

“[35] For our part, for reasons we articulate later, we agree with the observations in paragraph [31] and the first three sentences of paragraph [32] of Total Marine, set out above. We note that the observations which follow the first three sentences in paragraph [32] are obiter and although we do not consider that they should be understood as attempting to establish any binding decision rule, nonetheless they are, with respect, somewhat inconsistent with the earlier expressed proposition (with which we agree) that it is not useful to articulate any alternative test or criteria to the words of s.443(1)(b). We note that similar reservations were expressed by the majority of the Full Bench in JJ Richards and Sons Pty Ltd v TWU (JJ Richards No.1) and by the Full Bench in Farstad Shipping (Indian Pacific) Pty Ltd v MUA (Farstad).”

[14] It is clear from these authorities that whether an applicant “has been, and is, genuinely trying to reach an agreement”, is a question of fact to be decided having regard to all of the facts and circumstances of the particular case. 4

[15] Importantly in relation to this application, there is no specific stage in the bargaining or negotiations that must be reached in order for there to be a finding that an applicant is, and has been, genuinely trying to reach an agreement with the employer. 5

Relevant facts and circumstances leading up to the PABO application

[16] Overall, the chronology of events leading up to the PABO application was not contested. I have relied primarily on the written outline of evidence of Ms Morley of ACI (to the extent it was not challenged in cross examination, or otherwise it aligned with the statutory declaration of Mr Noack and the oral evidence given by Mr Thomas) in this regard.

[17] It is not disputed that bargaining for a new enterprise agreement commenced in or around November 2015 (the new agreement) at ACI’s Penrith NSW operations.

[18] Ms Morley gave evidence that over an 18 month period, the AWU and ACI bargaining representatives engaged in numerous bargaining meetings regarding the new agreement. Approximately 10 AWU delegates were appointed as bargaining representatives for the employees.

[19] A PABO application made by the AWU was granted by the Commission in September 2016, and an extension to the 30 day period to commence industrial action was granted in early November 2016.

[20] The evidence of Ms Morley was that on or around 8 and 9 December 2016, the parties reached an ‘in-principle agreement’ on the new agreement, which included agreement in relation to:

a. Arrangements for the use of labour hire to fill shifts of employees who take personal leave;

b. Job change – G4 employees; and

c. Amounts of the percentage increase and dates of payment.

[21] Ms Morley’s evidence was that at that time, the AWU advised that even though a new agreement had been agreed in-principle, it wanted to retain the employees’ ability to take industrial action because bargaining for new enterprise agreements at other company sites were ongoing. As a result, the AWU held two mass meetings of its members on 13 and 15 December 2016, of about 2 hours duration each.

[22] Ms Morley said that at around this time, given the agreement reached on the substantive issues, the parties further agreed that work would commence on the drafting of a ‘plain English’ version of the new agreement. This included agreement that if the plain English drafting of a particular clause could not be agreed, then the clause would retain the original drafting included in the Agreement.

[23] There were numerous discussions between the parties between February and July 2017, which resulted in agreement on a plain English drafting of some but not all clauses.

[24] Ms Morley gave evidence that there were two workshops during this period which focussed on the wording regarding the G-4 job change amendments.

[25] Ms Morley said that at a bargaining meeting on 18 July 2017, the parties confirmed that they had agreed on all outstanding ‘plain English’ drafting and the new agreement was ready to be put to a vote, which was confirmed by Mr Noack of the AWU.

[26] A vote of employees on the new agreement was scheduled to occur on 28 July 2017, however this was rescheduled to the morning of 29 August 2017.

[27] Mr Noack attended the workplace on the morning of 29 August 2017. A meeting took place at approximately 7am of the AWU and relevant employees.

[28] Ms Morley’s evidence was that at approximately 9am that morning, Mr Noack and AWU delegates informed her (and other managers of ACI) that:

a. The employees had voted to vote on the new agreement via a show of hands;

b. The employees had then voted to reject the new agreement by 76 votes to 3;

c. Immediately after voting to reject the new agreement, the employees had voted to commence a campaign of industrial action; and

d. On that basis, the AWU would be filing a protected action application.

[29] Mr Noack was asked by ACI representatives to explain what claims the AWU sought to advance because all claims had been by that time agreed. Mr Noack replied that the AWU sought:

a. Arrangements for use of labour hire to fill shifts of employees who take personal leave;

b. Job change – G4 employees; and

c. Back pay

[30] Ms Morley said that this was the first time the AWU had raised these claims since agreement was reached on those issues on 8 December 2016.

[31] The AWU was asked by ACI management to set out their issues in writing, detailing specifically what they were seeking.

[32] At approximately noon on 4 September 2017, Mr Noack met with the 10 AWU delegates on site. Following this meeting Mr Noack had a discussion with Ms Morley. She gave evidence that Mr Noack told her that the AWU was dropping the back pay claim and told her (and other ACI management representatives) of the union’s position on the other two points. Ms Morley responded by saying that ACI would consider its position and get back to the AWU.

[33] Mr Noack then advised that the AWU would be filing its protected action application, and this application was received by Ms Morley at around 4.30pm that afternoon by email.

[34] Ms Morley gave evidence that as at the date of the hearing, the AWU had not provided a written explanation of its two claims as requested by ACI on 29 August 2017.

Is the AWU genuinely trying to reach agreement with ACI?

[35] It was not put to Ms Morley in cross examination, nor was there any evidence adduced to suggest or establish that the AWU has “some other, extraneous intention, object or purpose” in seeking a protected action ballot or is seeking something other than an enterprise agreement under the Act 6. Further, no submissions to this effect were made on behalf of ACI. These matters are significant in considering whether the AWU is genuinely trying to reach an agreement with ACI7.

[36] ACI’s submissions in support of its argument that the AWU is not genuinely trying to reach agreement focused on:

a. The evidence of Ms Morley that an in-principle agreement was reached in December 2016; and
b. the events on 29 August 2017, in particular that employees had voted to reject the new agreement despite the in-principle agreement reached in December 2016, and had immediately voted to commence a campaign of industrial action, before advising ACI of the issues the AWU then sought to re-agitate.

[37] The evidence of Mr Thomas, senior site delegate, was that the in-principle agreement was an agreement to take certain matters back to employees for their approval. His evidence was that the delegates were not in a position to be able to bind their members to any particular agreement that might have been reached during bargaining. This could only be done via a formal vote on the new agreement. The vote that occurred on 29 August at a mass meeting unequivocally rejected the new agreement.

[38] The evidence of ACI characterises the agreement reached in December 2016 as an in-principle agreement. There is no dispute that a formal vote on the new agreement was scheduled and did take place on 29 August 2017. The evidence of Ms Morley confirmed that ACI issued a communication prior to the vote, informing employees that the new agreement would be put to a vote following the reaching of an in-principle agreement with the AWU.

[39] There is no evidence to suggest that this vote was simply a formality, nor was there any suggestion that employees were somehow compelled to vote a particular way (nor could they have been), because of the in-principle agreement reached between the bargaining representatives some months earlier.

[40] I accept Mr Thomas’s evidence that the AWU delegates did not have the power to reach a final agreement on behalf of its membership in the absence of a vote.

[41] The next matter relied on by ACI to demonstrate that the AWU is not genuinely trying to reach agreement was in relation to the three issues raised by the AWU immediately following the vote on 29 August 2017, which were discussed on 4 September 2017.

[42] ACI advised the AWU that it would consider its position in relation to those matters and get back to the AWU. ACI submitted that the AWU’s actions in filing its protected action application a few hours later, without waiting for a response from ACI, demonstrated the AWU is not genuinely trying to reach an agreement.

[43] In my view, the fact that the AWU did not wait for a response from ACI before making this application does not detract from the genuineness of the AWU’s desire to reach an agreement with ACI. There is no reason why a bargaining representative may not legitimately pursue protected industrial action during the course of bargaining as a legitimate means of furthering its genuine desire to reach agreement. This point was emphasised by a Full Bench of the Commission in Maritime Union of Australia v Swire Pacific Ship Management (Australia) Pty Ltd 8 (at [73]) as follows:

“In and of itself, a bargaining representative making a particular strategic choice which is permissible under the bargaining scheme established by the Act, is not a basis on which to conclude that the bargaining representative is not genuinely trying to reach an agreement or that the bargaining representative has some extraneous intent or purpose. Recourse to protected industrial action and applications to facilitate that action, are an accepted means by which a bargaining representative may further the interests of those it represents”.

[44] In any event, an email was sent from Mr Noack to Ms Morley 9 on the afternoon of 4 September 2017 which confirmed the outcome of the meeting that had taken place earlier that day, and set out the two issues raised by their members. The email concluded by Mr Noack indicating his availability to meet “this Friday if the Company is able to provide a response to this claim in order to resolve this matter”.

[45] Ms Morley gave evidence, which I accept, that she had not received the email because she was about to commence a period of extended leave and was in the process of handing over carriage of the matter to someone else.

[46] While the email was not received by Ms Morley, there is no doubt that Mr Noack did send the email, and did offer to meet to resolve the outstanding issues.

[47] I find that these events do not establish that the AWU is not trying to reach agreement with ACI.

Conclusion

[48] In the circumstances, I am satisfied that the PABO application has been made in accordance with s.437 of the Act. Further, I am satisfied that the AWU is genuinely trying to reach an agreement with ACI in relation to a new agreement.

[49] Accordingly, pursuant to s.443(1) of the Act, the Commission must make a protected action ballot order.

[50] No submissions were made on behalf of ACI in relation to the terms of order sought by the AWU. An order in the terms sought by the AWU will be issued separately [PR59563].

DEPUTY PRESIDENT

Appearances:

G Symington for the Applicant

G Fredericks of Counsel for the Respondent

Hearing details:

2017.

Sydney and Brisbane (by video):

September 6.

 1 [2012] FCAFC 53

 2   [2009] FWAFB 368

 3   [2015] FWCFB 210

 4   Esso Australia Pty Ltd v AMWU & Ors[2015] FWCFB 210 at [57] & [69]

 5   AMWU v HJ Heinz Company Australia Ltd[2009] FWA 322 at [20]

 6   J.J. Richards & Sons Pty Ltd v Transport Workers' Union of Australia [2010] FWAFB 9963 at [62]-[63]

 7   ibid

 8   [2014] FWCFB 2587

 9   Exhibit 1 email from Mr Noack to Ms Morley and others dated 4 September 2017

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<Price code C, PR595881>