Australian Workers' Union, The v Alcoa of Australia Limited T/A Alcoa World Alumina Australia

[2016] FWC 5672

[2016] FWC 5672

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

Australian Workers’ Union, The
v
Alcoa of Australia Limited T/A Alcoa World Alumina Australia
(C2015/7869)

COMMISSIONER WILLIAMS PERTH, 15 AUGUST 2016

Application to deal with a dispute - status quo.

Introduction

[1] This decision concerns an application made by The Australian Workers’ Union (the AWU or the applicant) under section 739 of the Fair Work Act 2009 (the Act). The respondent is Alcoa of Australia Ltd T/A Alcoa World Alumina Australia (Alcoa or the respondent).

[2] The dispute concerns a decision by Alcoa to, on 2 November 2015, discipline two employees Mr Simon Price (Mr Price) and Mr Chris King (Mr King) for non-compliance with Alcoa’s Western Australian Mining Dress Policy (the Policy) which details the required clothing standard for Alcoa’s Western Australian mining operations employees whilst on site.

[3] On 18 April 2016, the AWU advised the Commission that the question to be determined is:

“Did Alcoa contravene clause 19(b) of the Alcoa World Alumina Australia WA Operations AWU Enterprise Agreement 2014 (the status quo provision) when it issued a written warning to:

a) Mr Price on 2 November 2015; and

b) Mr King on 3 November 2015?”

[4] By consent the matter has been dealt with by the parties providing a set of agreed facts and providing submission in writing.

The agreed facts

[5] On 23 February 2016, the Commission conducted a hearing in relation to matter C2015/5714. In that matter the question the Commission has been asked to determine is:

“Is Alcoa World Alumina Australia entitled to require that all employees, including AWU Convenors, covered by the Alcoa World Alumina Australia WA Operations AWU Enterprise Agreement 2014 and working on-site within the Company's Western Australian Mining operations, comply with the terms of the ‘Western Australian Mining Dress Policy (MIN)’?”

[6] At the time of preparation of the Agreed Statement of Facts, no determination has been made in respect of matter C2015/5714.

[7] This matter relates to written warnings issued by the respondent to Mr Price and Mr King, AWU Convenors working within the respondent’s mining operations, on 2 November 2015 for breaching the Policy.

The Policy

[8] In about late 2012, proximate to the negotiations for the Alcoa World Alumina Australia WA Operations AWU Enterprise Agreement 2014 [AE407184] (the Agreement), the respondent commenced consultation with the applicant and employees working at the respondent’s Western Australian mining operations regarding the introduction of the Policy - which was to detail the required clothing standard for employees employed in its Western Australian Mining Operations (the Employees) whilst they were on site.

[9] In 2013 the parties recorded an agreement as to the types of shorts that would be made available to employees under the Policy. That agreement was recorded in a Memorandum of Understanding dated 13 December 2013.

[10] Prior to the introduction of the Policy, the respondent confirmed to Mr King and Mr

Price that AWY Convenors working in the respondent’s WA Mining Operations would be required to comply with the Policy.

[11] The AWU Convenors disagreed with the respondent’s requirement for them to comply in so far as it may contravene the Agreement but did not raise a dispute about the introduction of the Policy.

[12] Consultation on the Policy concluded in or about November 2014.

[13] Between completion of consultation and March 2015, the respondent made arrangements for implementation of the Policy (which included the sourcing and distribution of clothing consistent with the terms of the Policy).

[14] In January 2015 and March 2015, the respondent notified the Employees that compliance with the Policy would become mandatory from 31 March 2015. Prior to the respondent’s implementation of the Policy the AWU Convenors disagreed with the respondent’s requirement for them to comply in so far as it may contravene the Agreement but did not raise a dispute about the introduction of the Policy.

[15] On 31 March 2015, the respondent implemented the Policy. From 31 March 2015, Mr Price and Mr King continued to wear to work the clothes they had worn prior to the implementation of the Policy which variously included clothing which was non-compliant with the Policy and clothing which was compliant with the Policy.

April Written Warning

[16] On 8 April 2015, the respondent issued a written warning to Mr King.

[17] On 14 April 2015, Mr King initiated a dispute alleging that the Policy, particularly the application of it to AWU Convenors, breached the Agreement.

[18] The dispute initiated by Mr King on 14 April 2015 progressed through the Dispute Settlement Procedure, as outlined in clause 19 of the Agreement.

[19] The Respondent withdrew the warning to Mr King dated 8 April 2015.

[20] On 23 July 2015, the Applicant confirmed by email from Mr Brad Gandy (Mr Gandy), AWU Alumina Organiser, that the dispute initiated by Mr King would not be progressed further. Mr Price and Mr King continued to wear to work the clothes they had worn prior to the implementation of the Policy, which variously included clothing which was non- compliant with the Policy as well as clothing which was compliant with the Policy.

Matter C2015/5714

[21] On 3 August 2015, the respondent’s Production Superintendent, Mr Liam Smith (Mr Smith), notified the applicant (through Mr Gandy, Mr Price and Mr King) by email that it was disputing the refusal by Mr King and Mr Price to comply with the Policy.

[22] The dispute initiated by Mr Smith on 3 August 2015 progressed through the Dispute Settlement Procedure, as outlined in clause 19 of the Agreement and became Commission matter C2015/5714 referred to above.

[23] On 27 October 2015, Mr Smith emailed Mr King, Mr Price and Mr Gandy and noted:

(a) receipt of a compromise proposed by the applicant;

(b) that the respondent considered it had exhausted all reasonable options to negotiate an outcome acceptable to both parties;

(c) that it was respondent’s view that it had the right to implement the Policy;

(d) that all other employees had been compliant with the Policy without concern;

(e) that the respondent expected all of the respondent’s employees covered by the Policy would be expected to comply with the Policy as at 2 November 2015; and

(f) that a failure to comply may result in disciplinary action.

[24] On or about 30 October 2015, Mr Price and Mr King attended meetings with the respondent’s management representatives. At those meetings, the respondent noted the following matters:

(a) The background to the Policy;

(b) The disputation that had occurred;

(c) That it was the respondent’s view that the respondent’s instruction issued on 27 October 2015 was reasonable and lawful; and

(d) The respondent would take action in the event of non-compliance.

[25] At those meetings referred to above, the applicant claimed that the respondent’s instruction was not reasonable and lawful on the basis that the Policy and the instruction breached the Agreement in relation to the AWU Convenors.

November Written Warnings

[26] On 2 November 2015, Mr King and Mr Price both attended for the performance of work in shirts that had been worn prior to the implementation of the Policy that were non-compliant with the Policy.

[27] On 2 November 2015, the respondent issued a new written warning to Mr King.

[28] On 2 November 2015, Alcoa also issued a written warning to Mr Price. On 2 November 2015, the dispute initiated by Mr Smith on 3 August 2016 was still being processed according to clause 19 of the Agreement.

[29] On 2 November 2015, Mr Price emailed Mr Smith disputing the written warning issued to him and the warning issued to Mr King as a breach of the Agreement’s status quo requirement at sub clause 19 (b).

[30] The dispute raised by Mr Price was progressed through the Dispute Settlement Procedure, as outlined in clause 19 of the Agreement. This dispute became Commission matter C2015/5714.

[31] Following conciliation held in respect of this dispute (being matter C2015/7869), the respondent emailed the applicant on 2 February 2016 advising that the respondent did not accept that it had contravened the status quo requirement but proposed a resolution to the matter on the basis that:

(a) matter C2015/7869 be withdrawn;

(b) the warnings issued to Mr King and Mr Price be rescinded; and

(c) no further disciplinary action be taken by the respondent for a failure by Mr Price and Mr King to comply with the Policy whilst matter C2015/5714 was unresolved.

[32] Matter C2015/7869 was not resolved.

Other Relevant Matters

[33] The relevant provision of the Agreement for the purposes of the question referred to in this matter is clause 19(b) of the Dispute Resolution Procedure which reads as follows:

“Whilst the resolution of a grievance or dispute is being processed in accordance with this clause the status quo (i.e. the normal conditions/arrangements in existence immediately prior to the cause of the dispute arising) will be observed.”

The applicant’s submissions

[34] The applicant says that clause 19(b) of the Agreement has a plain meaning and consequently, the interpretation of the clause is a straightforward exercise. The applicant says further that any difficulty arises in identifying the appropriate facts to be applied from the unusual circumstances upon which this matter developed.

[35] Status quo is defined as “the existing or previously existing state or condition”. The parties have further defined status quo in clause 19(b) by including the words “i.e. the normal conditions/arrangements in existence immediately prior to the cause of the dispute arising”. The phrase status quo, as used in clause 19(b) of the Agreement, may appropriately apply these definitions.

[36] The relevant facts are summarised below before returning to the task of ascertaining the plain meaning of the status quo provision in the circumstances of this matter.

• The respondent introduced the Policy on 31 March 2015;



• The AWU Convenors, Mr Price and Mr King, disagreed with the respondent’s requirement for them to comply with the Policy in so far as it may contravene the Agreement;



• The AWU Convenors continued to wear the work clothes they had worn prior to the implementation of the Policy which included a shirt that was non-compliant with the Policy;



• On 3 August 2015, the respondent disputed the AWU convenors’ refusal to comply with the Policy, being their continued wearing of non-compliant shirts;



• The AWU Convenors continued to wear the work clothes they had worn prior to the implementation of the Policy which included a shirt that was non-compliant with the Policy;



• On 2 November 2015, the respondent issued written warnings to the AWU Convenors; and



• The respondent’s dispute initiated on 3 August 2015 was still being processed.

[37] It is not contested that the dispute resolution procedure at clause 19 of the Agreement was been activated by the respondent such as to make applicable the parties' obligations under clause 19 including the obligation to observe the status quo provision.

[38] In determining whether the respondent breached the status quo provision, it is appropriate to establish the following:

• The relevant dispute (or grievance);



• The cause of that dispute; and



• The normal conditions/arrangements in existence immediately prior to the cause of that dispute arising.

[39] First, to establish the dispute which triggered the status quo provision at the centre of the contravention alleged by the applicant, it is appropriate to return to dispute raised by the respondent on 3 August 2015. The respondent’s dispute of the AWU Convenors’ refusal to comply with the Policy, as described above in paragraph 8.4, was the dispute which triggered the status quo to be observed.

[40] Second, the applicant says that the cause of the dispute (being the respondent issuing the written warnings) is the AWU Convenors’ refusal to wear the new shirts as provided by the Policy.

[41] The applicant notes that the AWU Convenors’ behaviour, being the clothes (shirts) that they wear to work, is unchanged. The Agreed Statement of Facts state that “[f]rom 31 March 2015, Mr Price and Mr King continued to wear to work the clothes they had worn prior to the implementation of the Policy…”. The change however, is the implementation of the Policy requiring the AWU Convenors to wear a different shirt.

[42] The applicant says that in establishing the third point regarding the normal conditions or arrangements that existed immediately prior to the dispute arising, as proposed above, the normal conditions or arrangements applicable in this matter are:

• The AWU Convenors attended for work in shirts that had been worn prior to the implementation of the Policy that were non–compliant with the Policy; and



• The AWU Convenors did not have a written warning on their employment record in relation to the Policy.



• The applicant notes that this concurrently satisfies the definition of status quo being “the existing state or condition”.

[43] The applicant says that status quo provision requires the AWU Convenors to continue attending for work in shirts as they have worn prior to the implementation of the Policy the respondent must not issue any written warning to the AWU Convenors in relation to the Policy while the respondent’s 3 August 2015 dispute is being processed in accordance with the dispute resolution procedure in the Agreement.

[44] Therefore the applicant submits that the respondent’s issuing of written warnings to the AWU Convenors on 2 November 2016 contravenes the status quo provision of the Agreement.

The respondent’s submissions

[45] The respondent contends that clause 19(b) of the Agreement does not contain an ambiguity and has plain meaning. The respondent further contends that the:

(a) ‘status quo’ as defined will, in any dispute situation, need to be determined having regard for the factual matrix surrounding the particular matter in dispute; and

(b) definition of status quo as specifically included in the Agreement by the parties is not ambiguous and that the words have a plain meaning – which provide for two discrete considerations.

[46] The first consideration is the ‘normal conditions/arrangements’ in existence. Relevantly, the MacQuarrie Dictionary (Third Edition) defines:

“‘normal’ as:

‘conforming to the standard or the common type; regular, usual, natural, or not abnormal’

‘condition’ as:

‘situation with respect to circumstances’

‘arrangement’ as;

‘the manner in which things are arranged’”

[47] The second consideration is the time at which those ‘normal conditions/arrangements’ are in existence – which the parties have agreed in the Agreement to be “immediately prior to the cause of the dispute arising”. The respondent submits that, having regard for the above:

(a) The ‘cause’ of the dispute raised on 3 August 2016 (being the dispute which resulted in the activation of the ‘status quo’) was the refusal of the AWU Convenors to comply with the Policy prior to that date; and

(b) The ‘normal conditions/arrangements’ were those in place immediately prior to the respondent raising the dispute on 3 August 2011. Those ‘normal conditions/arrangements’ were:

(i) The respondent had implemented the Policy – which was stated to apply to all employees – from 31 March 2015;

(ii) No dispute had been raised by the applicant, the AWU Convenors or any other person regarding the introduction or the implementation of the Policy, notwithstanding the obvious capacity to do so (and the action taken by the AWU Convenors to actively seek a concession in respect of the types of shorts that could be worn by employees under the Policy);

(iii) All employees were required to comply with the Policy according to its terms; and

(iv) With the exception of the AWU Convenors, the respondent’s Western Australian mining operations workforce had accepted the Policy and conducted themselves in compliance with the Policy.

[48] Importantly, the respondent had not accepted the refusal of the AWU Convenors to comply with the Policy and therefore, it cannot be said that the refusal/failure to comply with the Policy can be claimed to be a ‘normal condition/arrangement’.

[49] The respondent submits that the refusal of the AWU Convenors to comply with the Policy cannot be characterised as the ‘normal conditions/arrangements’ as they represented an aberration to, and were acting in defiance of, the ‘normal conditions/arrangements’ in place at the time the dispute was raised on 3 August 2015. It was not reflective of, nor accepted by the respondent as the ‘normal condition/arrangement’ in place at that time. To the contrary, at that time, all employees, including the AWU Convenors, were required to comply with the Policy.

[50] The respondent contends that the applicant’s submitted interpretation of the status quo definition of the Agreement results in an inappropriately narrow interpretation of that term as it is inconsistent with the plain and ordinary meaning of the definition as specifically agreed to by the parties and included in the Agreement.

[51] The respondent submits that the Commission as constituted cannot, having regard for the plain and ordinary meaning of the words used to define the ‘status quo’ conclude that the ‘normal conditions/arrangements’ should be restricted to the AWU Convenors refusal/noncompliance – which has never been accepted by the respondent.

[52] For the reasons outlined above, the respondent contends that:

(a) The ‘normal conditions/arrangements’ in place at the time that the respondent’s dispute was raised were:

(i) the respondent had implemented the Policy – which was stated to apply to all employees – from 31 March 2015;

(ii) with the exception of the AWU Convenors, the respondent’s Western Australian mining operations workforce had accepted the Policy and conducted themselves in compliance with the Policy (causing it to be the ‘normal conditions/arrangements’ in place at that time’); and

(iii) The respondent had not accepted the refusal of the AWU Convenors to comply with the Policy – and therefore, that the refusal/failure to comply with the Policy cannot be claimed to be a part of the ‘normal conditions/arrangements’ in place at that time.

(b) As a consequence, the decision taken to issue written warnings to Mr King and Mr Price was not prevented by clause 19(b) of the Agreement; and

(c) The answer must conclude that the answer to the question presented by the applicant on 18 April 2016 must be ‘no’.

Consideration

[53] It is not contested and I am satisfied that the Commission is empowered by the terms of the Agreement, specifically clause 19−Dispute Settlement Procedure, and section 739 of the Act to determine this dispute by arbitration.

[54] I have had regard for the Agreed Statement of Facts the parties have filed in this matter and their respective submissions.

[55] In addition I have had regard for what is a matter of record, the Form F10−Application for the Commission to Deal with a Dispute in Accordance with a Dispute Settlement Procedure filed by Alcoa on 18 August 2015 which became C2015/5714. At 2.1 of the completed form there is a question titled ‘What is the dispute about?’ In response to this at paragraph 10 Alcoa stated:

“The applicant remains of the view that the on-site Convenors can be required to wear a uniform in accordance with the Policy. However, in lieu of taking a direct approach of requiring the on-site Convenors to comply with the Policy and applying disciplinary consequences for non-compliance, the applicant has placed the matter into dispute.”

[56] Clause 19−Dispute resolution Procedure provides at subclause (b) that:

“Whilst the resolution of a grievance or dispute is being processed in accordance with the clause the status quo (i.e. the normal conditions/arrangements in existence immediately prior to the cause of the dispute arising) will be observed.”

[57] The applicant submits that when Alcoa issued written warnings to Mr Price and Mr King on 2 November 2015 it breached the requirement to observe the status quo that had applied from the time Alcoa first raised the dispute on 3 August 2015 which, later when lodged with the Commission, became identified as C2015/5714.

[58] The first question to be determined is what was the status quo the parties were required to observe from 3 August 2015? The second question is was the issuing of the written warnings on 2 November 2005 a failure to observe that status quo amounting to a non-compliance with clause 19 of the Agreement?

[59] Having considered the parties Agreed Statement of Facts and their written submissions my view is that the dispute raised by Alcoa on 3 August 2015 concerned the continued refusal by Mr King and Mr Price to comply with the Policy. 1

[60] The cause of the dispute was that Alcoa was aware around late July 2015 that notwithstanding the recent finalisation of a dispute raised by Mr King in regard to Alcoa issuing him a written warning in April 2015 for not complying with the Policy, both Mr King and Mr Price continued to wear clothing which did not comply with the Policy. 2

[61] The status quo (i.e. the normal conditions/arrangements in existence immediately prior to the cause of this dispute arising) comprised three elements as follows:

• The Policy had been implemented and on its face applied to all employees;



• Mr King and Mr Price continued to wear clothing which did not comply with the Policy; and

• Alcoa had refrained from applying disciplinary consequences to these two employees for their non-compliance. 3

[62] Having determined what the status quo was, issuing written warnings to Mr Price and Mr King on 2 November 2015 for their non-compliance with the Policy was a failure to observe that status quo and so amounted to a contravention of clause 19 (b) of the Agreement.

COMMISSIONER

Final written submissions:

Applicant, 16 May 2016.

Respondent, 23 May 2016.

 1   Agreed Statement of Fact at paragraph 20.

 2   Ibid., at paragraphs 15 to 20.

 3   Ibid., at paragraphs 11 and 19. Form F10 filed by Alcoa on 18 August 2015 (C2015/5714) at 2.1, paragraph 10.

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<Price code C, PR584190>