"Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU) v Bureau Veritas Minerals Pty Ltd

[2018] FWC 5511

[2018] FWC 5511

FAIR WORK COMMISSION

REASONS FOR DECISION

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

"Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU)
v
Bureau Veritas Minerals Pty Ltd
(IA2018/4598, B2018/753)

COMMISSIONER HAMPTON ADELAIDE, 3 SEPTEMBER 2018

Proposed protected action ballot of employees of Bureau Veritas Minerals Pty Ltd.

1. Introduction

[1] An application has been made by the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers' Union (AMWU) under s.437 of the Fair Work Act 2009 (the Act) for a protected action ballot order in relation to certain employees of Bureau Veritas Minerals Pty Ltd (BVM). The relevant employees are the AMWU members who are presently covered by the Bureau Veritas Minerals Pty Ltd Adelaide Laboratories Enterprise Agreement 2014 (the 2014 Agreement).

[2] The AMWU and BVM are presently engaged in bargaining under the Act in relation to an enterprise agreement which is designed to replace the 2014 Agreement.

[3] On 27 August 2018, the Commission wrote to BVM seeking an indication of its position on the application and requested advice if the matter was to be contested. BVM advised that it opposed the application and provided reasons in support of its position.

[4] The application was heard on 29 August 2018. Having heard from the parties and considered the matter, I advised that a Protected Action Ballot Order (PABO) would be issued and that reasons for my decision would subsequently be provided, which I now do.

2. The Statutory context

[5] The Act relevantly provides as follows in relation to an application for a PABO:

“436 Object of this Division

The object of this Division is to establish a fair, simple and democratic process to allow a bargaining representative to determine whether employees wish to engage in particular protected industrial action for a proposed enterprise agreement.

Note: Under Division 2, industrial action by employees for a proposed enterprise agreement (other than employee response action) is not protected industrial action unless it has been authorised in advance by a protected action ballot.

Subdivision B—Protected action ballot orders

437 Application for a protected action ballot order

Who may apply for a protected action ballot order

(1) 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 the 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.

(2) Subsection (1) does not apply if the proposed enterprise agreement is:

(a) a greenfields agreement; or

(b) a multi-enterprise agreement.

(2A)  Subsection (1) does not apply unless there has been a notification time in relation to the proposed enterprise agreement.

Note: For notification time, see subsection 173(2). Protected industrial action cannot be taken until after bargaining has commenced (including where the scope of the proposed enterprise agreement is the only matter in dispute).

Matters to be specified in application

(3) The application must specify:

(a) the group or groups of employees who are to be balloted; and

(b) the question or questions to be put to the employees who are to be balloted, including the nature of the proposed industrial action.

(4) If the applicant wishes a person other than the Australian Electoral Commission to be the protected action ballot agent for the protected action ballot, the application must specify the name of the person.

Note: The protected action ballot agent will be the Australian Electoral Commission unless the FWC specifies another person in the protected action ballot order as the protected action ballot agent (see subsection 443(4)).

(5) A group of employees specified under paragraph (3)(a) is taken to include only employees who:

(a) will be covered by the proposed enterprise agreement; and

(b) either:

(i) are represented by a bargaining representative who is an applicant for the protected action ballot order; or

(ii) are bargaining representatives for themselves but are members of an employee organisation that is an applicant for the protected action ballot order.

Documents to accompany application

(6) The application must be accompanied by any documents and other information prescribed by the regulations.

438 Restriction on when application may be made

(1) If one or more enterprise agreements cover the employees who will be covered by the proposed enterprise agreement, an application for a protected action ballot order must not be made earlier than 30 days before the nominal expiry date of the enterprise agreement, or the latest nominal expiry date of those enterprise agreements (as the case may be).

(2) To avoid doubt, making an application for a protected action ballot order does not constitute organising industrial action.

439 Joint applications

Without limiting section 609, the procedural rules may provide for the following:

(a) how a provision of this Act that applies in relation to an applicant for a protected action ballot order is to apply in relation to joint applicants for such an order;

(b) the joinder, with the consent of each existing applicant, of one or more bargaining representatives to an application for a protected action ballot order;

(c) the withdrawal of one or more applicants from a joint application for a protected action ballot order.

440 Notice of application

Within 24 hours after making an application for a protected action ballot order, the applicant must give a copy of the application to the employer of the employees who are to be balloted, and:

(a) if the application specifies a person that the applicant wishes to be the protected action ballot agent—that person; or

(b) otherwise—the Australian Electoral Commission.

441 Application to be determined within 2 days after it is made

(1) The FWC must, as far as practicable, determine an application for a protected action ballot order within 2 working days after the application is made.

(2) However, the FWC must not determine the application unless it is satisfied that each applicant has complied with section 440.

442 Dealing with multiple applications together

The FWC may deal with 2 or more applications for a protected action ballot order at the same time if:

(a) the applications relate to industrial action by:

(i) employees of the same employer; or

(ii) employees at the same workplace; and

(b) the FWC is satisfied that dealing with the applications at the same time will not unreasonably delay the determination of any of the applications.

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).

(3) A protected action ballot order must specify the following:

(a) the name of each applicant for the order;

(b) the group or groups of employees who are to be balloted;

(c) the date by which voting in the protected action ballot closes;

(d) the question or questions to be put to the employees who are to be balloted, including the nature of the proposed industrial action.

(3A) For the purposes of paragraph (3)(c), the FWC must specify a date that will enable the protected action ballot to be conducted as expeditiously as practicable.

(4) If the FWC decides that a person other than the Australian Electoral Commission is to be the protected action ballot agent for the protected action ballot, the protected action ballot order must also specify:

(a) the person that the FWC decides, under subsection 444(1), is to be the protected action ballot agent; and

(b) the person (if any) that the FWC decides, under subsection 444(3), is to be the independent advisor for the ballot.

(5) If the FWC is satisfied, in relation to the proposed industrial action that is the subject of the protected action ballot, that there are exceptional circumstances justifying the period of written notice referred to in paragraph 414(2)(a) being longer than 3 working days, the protected action ballot order may specify a longer period of up to 7 working days.

Note: Under subsection 414(1), before a person engages in employee claim action for a proposed enterprise agreement, a bargaining representative of an employee who will be covered by the agreement must give written notice of the action to the employer of the employee.”

3. What is not in dispute

[6] It is not in dispute that the AMWU:

•  Is a bargaining representative and entitled to make this application;

•  Has made a proper application as required by the Act and has met the documentary and notice requirements for the application; and

•  Is not prevented from bringing the application by virtue of s.438 of the Act given the nominal expiry of the current enterprise agreement applying to the parties.¹

[7] I also find that these requirements are satisfied. Further, the notification time provided by s.437(2A) of the Act has occurred with BVM providing a notice of employee representational rights on 9 May 2017 and the formal commencement of bargaining.

[8] It also appears to be common ground that negotiations have been underway since mid-2017 and that the AMWU and BVM have been engaged in constructive bargaining for a replacement enterprise agreement. This has included multiple meetings between each of the bargaining representatives and between the AMWU and its members. The negotiation process has also included two separate ballots for a proposed agreement, with each of those rejected by a majority of the voting employees. There have been further discussions, with potentially more meetings to come in early September 2018; however, an agreed outcome endorsed by a valid majority of the employees has not yet been reached.

[9] I note that BVM did not seek an extended period of notice as contemplated by s.443(5) of the Act.

4. The positions of the parties

[10] The AMWU provided oral submissions confirming its position that it has bargained in good faith throughout negotiations, was genuinely seeking an agreement, and will continue to do so. However, an impasse had been reached, in particular in relation to the proposed pay increase, prompting the making of this application. It was contended that all of the other statutory requirements had been met for a PABO to be issued. This was supported by a Statutory Declaration of Mr Peter Bauer, Union Official of the AMWU.

[11] The objection advanced by BVM in relation to the application may be summarised as follows:

•  Whilst it continues to negotiate in good faith it appears that a stalemate has been reach in terms of the amount of pay increase on offer as part of the new agreement;

•  It has changed its offer in relation to the pay increase and offered a (shorter) two-year term for the agreement in an attempt to be as flexible as possible and had made an appropriate and realistic offer given the circumstances now facing the Adelaide operations and wage outcomes in other areas of its business;

•  It is committed to continuing to bargain in good faith and has proposed a new date for the next bargaining meeting;

•  The majority of employees do not want to take industrial action; and

•  In the circumstances, the PABO application is unnecessary, counter-productive and not in the best interests of its employees.

[12] BVM did not contest the factual assertions set out in the Statutory Declaration of Mr Bauer.

5. Consideration

[13] The role of the PABO, and consequently the role of the Commission in considering any such application, is established by the terms of the Act. Essentially, a PABO is a necessary step for a bargaining representative to ultimately seek the capacity to take protected industrial action in support of bargaining for a single enterprise agreement.

[14] The PABO is part of the bargaining regime of the Act. The scheme of the Act is outlined in various decisions of the Commission including in John Holland v “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) and The Australian Workers’ Union[2010] FWAFB 526 and by the Federal Court in J.J. Richards & Sons Pty Ltd v Fair Work Australia [2012] FCAFC 53.

[15] The taking of protected industrial action by both employees and employers, that is designed to advance claims and to persuade the other party to change their position, is part of that scheme.

[16] Whether any proposed industrial action becomes protected will ultimately depend on compliance with the statutory parameters including whether a relevant question is supported by the ballot,² whether the action is notified in accordance with the requirements of the Act,³ and whether it is industrial action within the meaning of the Act.⁴ Further, an employer who is subject to threatened, impending or probable industrial action may seek to have such action suspended or terminated on various grounds including whether it endangers the life, the personal health or safety, or the welfare, of the population or of part of it or causes significant damage to the Australian economy or an important part of it,⁵ or causes significant economic harm.⁶ Industrial action that is not protected industrial action may be prevented.⁷

[17] Given the undisputed facts of this matter, there is no contest that a valid application has been made by the AMWU.

[18] It is apparent from the terms of the Act that in order to succeed with this application the AMWU must satisfy the Commission that it has been, and is, genuinely trying to reach an agreement with BVM as required by s.443(1)(b) of the Act. It is also apparent from s.443 of the Act, that where this requirement is met (along with the other prerequisites that are not in dispute here) the Commission must make a PABO.

[19] In Total Marine Services Pty Ltd v The Maritime Union of Australia⁸ (Total Marine) the Full Bench said:

“[30] The requirement that an applicant for a ballot order genuinely try to reach an agreement and be continuing to do so at the time an application for a ballot order is made was a requirement in the Workplace Relations Act 1996. The wording of the relevant section has been altered because of the removal of a process of establishing a bargaining period during which protected action may be taken. The concept of genuinely trying to reach an agreement was dealt with in other parts of the Workplace Relations Act 1996, specifically in relation to the grounds for terminating a bargaining period.

[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.”

[20] In JJ Richards & Sons Pty Ltd v Fair Work Australia⁹ the Federal Court was dealing with a circumstance where the employer had refused to bargain. Flick J determined, in effect, that the Commission cannot reach a state of satisfaction that an “applicant ... is ... genuinely trying to reach an agreement with the employer” unless:

1. an applicant has approached the employer and informed the employer of the general ambit of that for which agreement it sought; and

2. the employer has foreshadowed - even in the most general terms - its attitude as to the proposed agreement.¹⁰

[21] Flick J also went on to observe in the same decision that the above “minimum statement” was “sufficient to dispose of the present application however more may be required and much may well depend on the factual scenario in which the terms of s.443(1)(b) are to be applied.”¹¹ I note further that Flick J also observed that the addition of the term “genuine” in the phrase genuinely trying to reach agreement “serves to emphasise the importance of a person actually trying to solicit agreement.” ¹²

[22] In approaching any such assessment, it must also be borne in mind that the expression “genuinely trying” in the present context is concerned with the genuineness of efforts by the bargaining representative to achieve the goal of an enterprise agreement that meets the approval requirements of the Act. This will turn upon the applicant’s motivation; its intention, object or purpose.¹³

[23] The Act in s.228 establishes the obligations on bargaining representatives to act in good faith in the following terms:

“228 Bargaining representatives must meet the good faith bargaining requirements

(1) The following are the good faith bargaining requirements that a bargaining representative for a proposed enterprise agreement must meet:

(a) attending, and participating in, meetings at reasonable times;

(b) disclosing relevant information (other than confidential or commercially sensitive information) in a timely manner;

(c) responding to proposals made by other bargaining representatives for the agreement in a timely manner;

(d) giving genuine consideration to the proposals of other bargaining representatives for the agreement, and giving reasons for the bargaining representative’s responses to those proposals;

(e) refraining from capricious or unfair conduct that undermines freedom of association or collective bargaining;

(f) recognising and bargaining with the other bargaining representatives for the agreement.

(2) The good faith bargaining requirements do not require:

(a) a bargaining representative to make concessions during bargaining for the agreement; or

(b) a bargaining representative to reach agreement on the terms that are to be included in the agreement.”

[24] The good faith bargaining obligation is a separate consideration to the assessment of whether a party is genuinely trying to reach an agreement.¹⁴ In any event, it has not been suggested in this case that the AMWU is not bargaining in good faith. I add that there is also every indication that BVM has been bargaining in good faith.

[25] In considering a similar bargaining regime,¹⁵ Lawler VP was discussing the meaning of “genuinely trying to reach agreement” in Liquor, Hospitality and Miscellaneous Union - Western Australian Branch v CSBP Limited¹⁶ and observed:

“[38] Secondly, the notion of “genuinely trying to reach agreement” does not automatically imply continual movement in the same direction by a negotiating party. Depending upon the circumstances, a negotiating party can withdraw a concession or offer on a particular issue in the negotiation, or renew a previously abandoned position, and still be genuinely trying to seek agreement. Such changes of position can legitimately arise for any number of reasons. For example changed trading conditions may provide an entirely reasonable basis for an employer to withdraw or reduce an offer to increase wages by a particular amount without detracting from the genuineness with which the employer is negotiating.”

[26] I would respectfully agree with that approach. I also note that given the negotiating room that parties may include in their opening positions, great care should be taken in simply considering relative movements in positions as an indication of genuineness.

[27] Given the scheme of the Act, it is not the role of the Commission to determine whether the PABO, or the taking of protected industrial action, is necessary or even a good idea. Provided that the requirements have been met, the Commission is obliged to issue a PABO and it is the members of the Unions that will decide whether any such action is to be endorsed. Further, all parties must continue to bargain in good faith. In terms of the capacity to avoid any negative consequences for all parties, this is of course desirable, and I will return to this aspect as part of the conclusions to this matter.

[28] In this case, I am satisfied that the AMWU has been genuinely seeking to reach an agreement with BVM, and that this remains so. The actions that it has taken are consistent with a party seeking such an outcome in the context of these negotiations. Further, whilst it is possible that further negotiations may be capable of achieving an agreement without recourse to protected industrial action, this is not inconsistent with genuinely seeking to reach an agreement and the absence of that prospect is not a prerequisite for a PABO to be issued. In this respect, it is understood that the two parties intend to meet in early September to further progress negotiations.

[29] Having regard to all of the circumstances evident here, I was satisfied that the AMWU has been, and is, genuinely trying to reach an agreement with BVM as required by s.443(1)(b) of the Act.

6. Conclusions and orders

[30] I found that all of the statutory requirements of s.443 had been met and that the proposed PABO was in order.

[31] Accordingly, I was obliged to issue a PABO. In conformity with the Act, an order in relation to the application by the AMWU¹⁷ was issued by the Commission.

[32] I note the circumstances of this application and the fact that there is only one, albeit significant, outstanding issue and return to my earlier comments about the desirability of avoiding negative consequences for all parties. In that regard, I would observe that it is open to one or more of the parties to lodge an application pursuant to s.240 of the Act seeking the Commission’s assistance to deal with the bargaining dispute.

[33] I also observe that the obligation under s.228 of the Act to bargain in good faith continues when a PABO application is granted and this remains the case even in circumstances where protected industrial action may be endorsed and taken.

COMMISSIONER

Appearances:

P Bauer for the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers' Union.

W Tubman, N McAllister and C Kenna for Bureau Veritas Minerals Pty Ltd.

Hearing details (by telephone):

2018

Adelaide

29 August.

1 The 2014 Agreement reached its nominal expiry date on 30 June 2017.

2 Sections 437, 408 and 409 of the Act.

3 Section 414 of the Act.

4 Section 19 of the Act.

5 Section 424 of the Act.

6 Section 423 of the Act.

7 Section 418 of the Act.

8 [2009] FWAFB 368, per Watson VP, Hamberger SDP and Roberts C.

9 [2012] FCAFC 53.

10 JJ Richards & Sons Pty Ltd v Fair Work Australia [2012] FCAFC 53 at PN 58.

11 Ibid.

12 Ibid at PN 59.

13 Mermaid Marine Vessel Operations Pty Ltd v The Maritime Union of Australia [2014] FWCFB 1317 in citing the majority in J.J. Richards & Sons v Transport Workers’ Union of Australia[2010] FWAFB 9963.

14 Alleged breaches of good faith bargaining obligations are dealt with under s.229 of the Act. See also: Esso Australia Pty Ltd v Australian Manufacturing Workers’ Union[2015] FWCFB 210 at [18].

15 Under the Workplace Relations Act 1996.

16 [2007] AIRC 112.

17 PR620324.

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