[2016] FWC 6126

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.437 - Application for a protected action ballot order

Australian Workers' Union, The
v
Winchester Australia Limited
(B2016/745)

DEPUTY PRESIDENT GOSTENCNIK

MELBOURNE, 30 AUGUST 2016

Proposed protected action ballot of employees of Winchester Australia Limited.

Introduction

[1] Certain employees of Winchester Australia Limited (Winchester) are covered in their employment with Winchester by the Winchester Australia Limited Enterprise Agreement 2013 (Agreement). The nominal expiry date of the Agreement, namely 30 June 2016, has passed.

[2] On 27 April 2016, the Australian Workers’ Union (AWU) and Winchester commenced bargaining for a proposed enterprise agreement and on 4 May 2016, Winchester gave employees employed at the time and who will be covered by the proposed agreement a Notice of Employee Representational Rights. The AWU is a bargaining representative for the proposed agreement.

[3] Since bargaining commenced there have been a number of bargaining meetings through the period of May 2016 to August 2016. A bargaining dispute notified by Winchester pursuant to s.240 of the Fair Work Act 2009 (Act) has also been the subject of several conferences before another member of the Commission. Bargaining continues and an agreement has yet to be reached.

[4] By application lodged on 9 August 2016, the AWU has applied for a protected action ballot order (PABO) pursuant to s.437 of the Act. Winchester opposes the making of a PABO and in the event that a PABO is made, Winchester seeks an order pursuant to s.443(5) that the period of written notice referred to in paragraph 414(2)(a) be longer than three working days. It seeks that the protected action ballot order specifying a longer period of seven working days.

Consideration

[5] Winchester maintains that if the totality of the conduct of the AWU as bargaining representative is considered, it cannot be said that the AWU has been and is genuinely trying to reach an agreement with Winchester.

[6] Mr Clive Pugh is the General Manager of Winchester, and has been involved in the bargaining, although he has not attended the majority of bargaining meetings. Mr Pugh gave evidence about the bargaining and the conduct of the AWU during bargaining. As Mr Pugh was not in attendance for the majority of the bargaining meetings, his evidence about that which occurred during the bargaining meetings is based on information provided to him by others. Representatives of Winchester who attended the bargaining meetings at which Mr Pugh was not present were not called to give evidence. Mr Pugh’s evidence is summarised as follows below:

During a bargaining meeting held on 4 May 2016, Winchester provided the AWU with an outline of how it wanted to progress the bargaining process and provided an outline of 9 items that Winchester wanted to discuss and resolve including changes in some wage classifications, clarification of cashing out personal carer’s leave, a wage increase between 1% and 3%, change to the incentive, removal of $50.00 additional shift allowance, incorporating allowances into rates of pay, reviewing shutdown periods and to amend some clauses to remove ambiguity and simplify allowances;

On 11 May 2016, Winchester provided the detail of its management claims. The AWU presented its log of claims and there was general discussion about the progress of meetings. The AWU received Winchester’s claims and made no additional comments;

On 18 May 2016, Winchester led a discussion on its claims about the allowances, shutdown timing and other matters. The AWU provided no formal response or any substantiation of their log of claims;

On 30 May 2016, Winchester led a discussion on warehouse position descriptions and lead room RDO;

On 8 June 2016, Winchester provided additional information in regard to questions from employees regarding the cost impact of the AWU log of claims, in particular how superannuation increases would benefit 25 of 45 employees. Winchester also provided information about its position on personal carers leave;

On 22 June 2016, Winchester provided details of its wage offer to Ms Tanya Harrington, an organiser with the AWU. The AWU asked for the rate increases to be reversed and for Winchester to consider flexibility of annual leave. The AWU also made comments about a training matrix and inclusion in the document of that matrix;

On 6 July 2016, Winchester provided a draft agreement and detailed list of changes and responded fully to the union log of claims to the AWU based on the Winchester’s understanding of what the AWU and employees were seeking;

On 13 July 2016, Ms Harrington provided by email a written response to the proposed list of changes with many clauses simply marked as not agreed and no further supporting information provided. Winchester responded with a further request seeking details be supplied at the meeting on 15 July 2016;

On 15 July 2016, the parties conducted a further bargaining meeting and Ms Harrington provided a verbal response in support of her written response indicating a majority of items as ‘not agreed’ with no supporting explanation. The AWU site representatives did not have a copy of the notes and Ms Harrington said she had not had time to prepare any other comments saying she was waiting for her legal department to comment. Winchester suggested that the respective legal representatives meet and the AWU said this would be a waste of time;

On 15 July 2016, Winchester requested that the AWU provide additional information prior to the next scheduled meeting on 25 July 2016. Ms Harrington was unavailable to meet for two weeks;

On 19 July 2016, in the absence of the AWU organiser, the AWU site delegates met with the Production Manager, Mr Glenn Falla and provided him with an updated log of claims. This had not been reviewed by the AWU and the Company sought clarification from the AWU about the status of the updated log of claims was. No response was provided by the AWU;

On 25 July 2016, Winchester made a request through the AWU site delegates to confirm a meeting with the AWU. No response was received;

On 26 July 2016, Winchester was informed by the AWU that the earliest date available to meet would be 29 July 2016;

On 28 July 2016, the Company provided a revised draft of the agreement with a list of explanatory notes to the AWU for their consideration and comment;

On 29 July 2016, the AWU again failed to provide a response to the management claims.

Ms Harrington told me that she had not had time to review the most recent update of Winchester’s position and claimed legal would need to review the amendments. It was the view of Winchester that no agreement would be reached on most of the draft changes and the company requested the AWU to spend the time in the meeting with the site representatives to go through the documented changes. Ms Harrington agreed to do this and asked for a mass meeting on 4 August 2016;

On Saturday, 30 July 2016 the AWU finally documented its response;

The response was still incomplete as many of the areas required that the AWU either needed to receive instructions from employees or their internal legal department. In relation to the AWU log of claims that had been provided by the site representatives, Ms Harrington provided no further comments. This meant that Winchester still did not know the detail of some claims.

On 1 August 2016, Mr Pugh together with the Production Manager, Mr Glenn Falla met with AWU site delegates Mr Steve Tidlacka and Mr Matt Fiesley. During these discussions we canvassed several outstanding matters including rates of pay, personal carers leave, removal of bonus and the AWU log of claims.

Because the AWU had failed to provide detail of what was being sought and we could not get them to disclose how agreement may be reached Winchester had no alternative to seek the assistance of the Commission.

On 3 August 2016, I requested that the section 240 application be filed. I did this so that Winchester would be in a position to elicit the response to claims and so that further detail of the meaning of what was sought by the AWU claims could be provided.

At the time of submitting the section 240 application we did not know what the nature of the wage claim and other key matters was.

On 9 August 2016, in response to the section 240 application a conference was conducted before DP Kovacic.

The AWU have not been genuinely trying to reach an agreement because Winchester has not been in a position where it was aware of what was required to secure an agreement.

There were a number of items that Winchester was waiting on a response from the AWU on, including consultation, personal carers leave, redundancy, rates of pay, classifications, afternoon shift extra allowance, hours of work, incentive, superannuation, annual leave notice period and the discipline procedure.

On 9 August 2016, Winchester was advised that the AWU had not received instructions in relation to the wages proposal, the team leader changes, the classification structure, the changes to afternoon shift and hours of work.

Until 9 August 2016, the AWU had not explained the detail of its claims and have consistently delayed any response and refused to explain the meaning of what was being sought.

For example, it was not until 9 August 2016 that Winchester understood what was being sought in relation to their redundancy claim.

On 9 August 2016, it was also evident that the AWU needed to consult employees on a number of matters. The AWU explained some of the matters that it had been claiming. The AWU submitted additional claims for a cap on shutdowns.

At the FWC conference on 22 August 2016, the AWU failed to provide any further instructions on the outstanding matters.

During the intervening period between the 9 and 22 August 2016, Winchester had requested to meet with Ms Harrington to continue bargaining however she was unavailable. 1

[7] Ms Harrington gave evidence that she has attended each of the bargaining meetings that have occurred between AWU and Winchester, 2 as well as attending the bargaining dispute conferences convened by the Commission.3 Ms Harrington’s evidence was that the AWU have provided considered responses to Winchester’s proposals for a proposed agreement, including in writing on 12 July, 29 July and 20 August 2016.4 I have reviewed the responses said to have been provided by the AWU,5 and I am satisfied that, although in summary form necessitated by the tabular nature of the documents, the responses show that the AWU has been providing responses to Winchester’s positions in relation to the proposed agreement, as well as clarifying its own position in relation to its log of claims.

[8] Ms Harrington also gave evidence that the AWU has compromised a number of its claims. For example, it has modified its wage claim from 5 percent per annum to 3.5 percent per annum. It has withdrawn its claims for vacant positions to be advertised internally; for the night shift RDO to be on a Sunday; for a new training clause; for a new health and fitness clause; and, for flexibility arrangements in relation to annual leave. 6

[9] Mr Pugh’s evidence about these matters was that he disputed that the AWU has compromised on its claims, or that the items referred to above were modified or withdrawn. He said specifically, that the said compromise in wage increase, the said withdrawal of the internal advertisement of positions claim, and the flexibility in taking annual leave claim as set out in Ms Harrington’s witness statement, were the first time the AWU have indicated a change in the nature of their log of claims. He said that Winchester has asked for the AWU to provide a position on the taking of annual leave and this claim was only presented to Winchester at the hearing of the s.240 application. 7

[10] This evidence cannot be accepted in light of the written response provided by the AWU to Winchester during the bargaining meeting on 29 July 2016, 8 coincidentally being the meeting during which Mr Pugh had become frustrated and left shortly after the meeting commenced.9 That document notes, for example, the AWU log of claims for wage increases of 5 percent per annum changed to 3.5 percent per annum. It notes the AWU log of claims for a new position to be advertised (internally) with the employer position that there be “no change in the agreement” and the AWU response as agreeing with that position. The document also notes the AWU log of claims for flexibility in taking annual leave, and its position as at the date of the document as “remove”. The document records the AWU log of claims for RDO for night shift to be a Sunday, Winchester’s position as “not agreed” and the AWU’s position, as at the date of the document, as “remove”. The document records the AWU log of claims for introduction of a health and fitness clause, with Winchester’s position as “not agreed, company to determine programs”, and the AWU’s position as at the date of the document noted as “agreed”.

[11] I therefore accept Ms Harrington’s evidence in this regard.

[12] The gravamen of Winchester’s allegation that the AWU has not been and is not genuinely trying to reach agreement seems to amount to no more than an argument that the AWU has not provided timely responses and has not devoted sufficient resources to ensure that bargaining progresses more quickly, specifically in consulting with and obtaining instructions from its members for whom the AWU is a bargaining representative. This is borne out by the following extract of the evidence given by Mr Pugh recorded in transcript:

“MR REILLY: Mr Pugh, at paragraph 7 of your statement you say that the AWU has not been genuinely trying to reach an agreement, correct?---That's correct, yes.

So over the course of 12 meetings on-site and five mass meetings held by the AWU with its members - sorry 13 meetings on-site and two conciliation conferences before the Commission, the AWU hasn't been trying to reach an agreement. What do you say they have been doing?---Well, we would say that we don't believe that the AWU has been devoting sufficient time to obtain instruction from its members, in order to respond fully to the changes that the company's put forward. And that as a result of that, that has delayed the process.

Yes, but there's no other thing you would say we're trying to accomplish besides reaching an agreement?---Well, I would expect timely responses to our requests to be a way for us to reach agreement more readily than we have. That delays in making those responses is an indication to us that the AWU has not been making a genuine attempt.

But is there something else that you say we're trying to accomplish besides reaching an agreement?---Well, it's hard for me to say that.

So, no. To the best of your knowledge?---No.

So in essence your claim is that you don't like the AWU has bargained or you think the AWU is bad at bargaining? Not that we're not trying to reach an agreement but we're doing a bad job?---I would say that not obtaining instructions from employees, given the timeframe within which we were attempting to reach an agreement, despite our efforts of presenting substantial information, I think reflects that that is not a genuine attempt to reach agreement. That's my view.

But you don't say there's anything else you were trying to achieve besides reaching it?---Other than not being able to achieve an agreement within the parameters within which we are trying to resolve it. I mean that's the - I mean that is an issue for us.” 10

[13] Section 437 enables a bargaining representative to apply for a PABO. Section 437(1) provides:

“A bargaining representative of an employee who will be covered by a proposed enterprise agreement, or 2 or more such bargaining representatives (acting jointly), may apply to FWC for an order (a protected action ballot order) requiring a protected action ballot to be conducted to determine whether employees wish to engage in particular protected industrial action for the agreement.”

[14] Excepting the restriction on making an application in ss.437(2A) and 438(1), the Commission must make a PABO in relation to employees who will be covered by a proposed agreement in the circumstances set out in s.443. There is no contest that the restrictions do not apply in the instant case. Section 443 relevantly provides:

“443 When FWC must make a protected action ballot order

(1) 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) 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) 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).”

[15] The concept of genuinely trying to reach an agreement involves a finding of fact applied by reference to the circumstances of the particular bargaining. 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. Neither is it appropriate nor possible to establish rigid rules for the required point of bargaining that must be reached. All of the relevant circumstances must be considered in assessing whether an applicant for a PABO has met the test in s.443 of the Act. This will frequently involve considering the extent of progress in negotiations, and the steps taken in order to try and reach an agreement. 11

[16] To the extent that it is suggested that there has been a failure to meet good faith bargaining requirements, it must be borne in mind that although there is a relationship between the good faith bargaining requirements and the concept of genuinely trying to reach an agreement, it would be wrong to conflate these terms. An applicant for a PABO may not meet a particular good faith bargaining requirement, but may nevertheless be genuinely trying to reach an agreement. 12

[17] Contrary to the submissions of Winchester, the evidence does not disclose that the AWU has not been and is not genuinely trying to reach agreement with Winchester. To the contrary, the evidence discloses that the AWU has attended regular meetings with Winchester at which it has not only pursued its claims for a proposed agreement, but has dealt with and responded to claims for a proposed agreement advanced by Winchester. That it could have responded to Winchester’s claims in a more timely fashion, or that it could have further elaborated on the various claims that the AWU was advancing, is with respect, debatable. It is doubtless the case, that Winchester wishes to have bargaining proceed more quickly than has been its experience thus far. But, there is nothing in the evidence which would suggest that the AWU is dragging its heels, that it is otherwise engaged in some form of surface bargaining, or that the conduct of its bargaining strategy is motivated by an absence of a genuine desire to reach agreement.

[18] Moreover, Winchester’s complaints about the adequacy of particular responses that it received from the AWU could have been addressed by Winchester engaging with the good-faith bargaining provisions of the Act. In any event, I am not persuaded that the AWU did not respond to claims advanced by Winchester or explain its claims to Winchester. That Winchester did not like the response is beside the point. On my review of the written documents which set out the progress of bargaining, the positions of the parties seemed to me to be clear enough. Some positions have been altered since bargaining began. Some positions have been abandoned and other claims have taken greater prominence. In this regard, I also prefer the direct evidence given by Ms Harrington about her conduct during the various bargaining meetings to the predominantly hearsay evidence of Mr Pugh.

[19] That the AWU has rejected many of the claims advanced by Winchester or has not accepted the rationale advanced by Winchester for its various positions is not an unusual phenomena of bargaining. It does not, however, establish that the AWU has not been or is not genuinely trying to reach an agreement. This is simply a case where the AWU is maintaining its position on many, but not all, of its claims and its position on Winchester’s claims. To that extent, it might be said that the AWU is driving a hard bargain, but again that it is driving a hard bargain does not have the result that the AWU has not been, or is not genuinely try to reach an agreement.

[20] Winchester submitted that there has been a delay between the making of the application and the hearing, with the consequence that the conduct of the AWU following the making of the application and in close proximity to the hearing has had the effect of fundamentally altering the status of the negotiations, and in particular, that such progress as has been made has been as a result of the proceedings that Winchester initiated pursuant to s.240 of the Act. As such, Winchester submitted that the AWU’s conduct as at the date of the application, which it says shows that it is not genuinely trying to reach an agreement, should be viewed in this context. I do not accept that delay in the hearing of the application and the most recent conduct of the AWU has altered the status of bargaining. On the evidence as a whole I am satisfied that the AWU has been and was as at the date of the application genuinely trying to reach agreement. That which has occurred since, merely reinforces the AWU’s genuineness in trying to reach an agreement.

[21] I am therefore satisfied that the AWU has been and is genuinely trying to reach an agreement with Winchester.

[22] As earlier indicated, Winchester seeks an order pursuant to s.443(5) that the period of written notice referred to in paragraph 414(2)(a) be longer than three working days. It seeks that the protected action ballot order specify a longer period of seven working days. The evidentiary basis for seeking the additional period is set out in the evidence of Mr Pugh as follows:

“. . . the operational facility operates under the terms of a licence from Worksafe Victoria for the import, storage, manufacture and sales of explosives in accordance with the Australian Explosives Code. Accordingly, certain actions proposed by the AWU in their application may put the company in breach of its licence obligations. To manage this risk, the Company would need additional notice of industrial action to transfer raw materials and finished goods.” 13

[23] Although the AWU did not cross-examine Mr Pugh on this evidence, the state of the evidence is such that it is insufficient for me to be satisfied that there are exceptional circumstances which might warrant the exercise of my discretion to require a further period of written notice. As Winchester seeks a longer period of notice for any protected industrial action, it bears the evidentiary onus of establishing that there are exceptional circumstances which would warrant the order sought. The evidence, in its present state, falls well short of discharging that onus. In particular, Winchester does not provide any details as to which obligations bind it, which of the various forms of industrial action the subject of the PABO application will have the result alleged, or how that industrial action might have the consequence alleged. Nor does Winchester provide any details as to the mitigating steps that are available to it, how quickly those steps might be taken or the impediments, if any, that might stand in the way of the steps being effective.

[24] In these circumstances, I am not satisfied that there are exceptional circumstances justifying the period of written notice referred to in paragraph 414(2)(a) being longer than three working days.

Conclusion

[25] I am satisfied that the AWU, as bargaining representative for the proposed agreement and applicant for a PABO, has been and is genuinely trying to reach agreement. I am also satisfied that neither restriction on making an application in ss.437(2A) and 438(1) operates to prevent the application. I am satisfied and it was not in contest that the other statutory criteria have been met.

[26] A protected action ballot order will be made and is separately issued in PR584780.

DEPUTY PRESIDENT

Appearances:

Mr P. Reilly for the Australian Workers’ Union.

Ms K. Sheridan on behalf of Winchester Australia Limited.

Hearing details:

2016.

Melbourne.

August 26.

1 Exhibit 4 at [16]-[46].

2 Exhibit 1 at [12].

3 Ibid at [13].

4 Ibid at [17].

5 Ibid at Attachments TH–2, TH–3 and TH–4.

6 Ibid at [18].

7 Exhibit 4 at [47.1(j)].

8 Exhibit 2 at [17], Attachment TH–3.

9 Transcript PN320.

10 Transcript PN311 – PN337.

11 Total Marine Services Pty Ltd v Maritime Union of Australia[2009] FWAFB 368; (2009) 189 IR 407 at [32]-[33]; Esso Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers' Union (AMWU); Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU); The Australian Workers' Union (AWU)[2015] FWCFB 210 at [34]-[35].

12 See the decisions of Gostencnik DP in NUW v Riverland Oilseeds Pty Ltd [2013] FWC 5914 at [17]-[ 19]; Hamberger SDP in TWU v CRTGroup Pty Ltd[2009] FWA 425 at [26], and Lewin C in NUW v SKF Australia Pty Ltd[2010] FWA 6557 at [19] - [21]; endorsed by a Full Bench of the Commission in Esso Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers' Union (AMWU); Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU); The Australian Workers' Union (AWU)[2015] FWCFB 210 at [18].

13 Exhibit 4 at [53].

Printed by authority of the Commonwealth Government Printer

Australian Workers' Union, The v Winchester Australia Limited

[2016] FWC 6126

30 AUGUST 2016

DECISION

Introduction

Consideration

Conclusion