“Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers' Union (AMWU) v GlaxoSmithKline Australia Pty Ltd

[2013] FWC 4628

[2013] FWC 4628

FAIR WORK COMMISSION

REASONS FOR DECISION

Fair Work Act 2009
s.437—Protected action

“Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU)
v
GlaxoSmithKline Australia Pty Ltd
(B2013/162)

DEPUTY PRESIDENT GOOLEY MELBOURNE, 16 JULY 2013

Proposed protected action ballot by employees of GlaxoSmithKline Australia Pty Ltd.

[1] The “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (the AMWU) applied pursuant to section 437 of the Fair Work Act 2009 (the Act) for a protected action ballot order. The AMWU sought an order that employees of GlaxoSmithKline Australia Pty Ltd (the Respondent) who are members of the AMWU and who would be subject to the proposed enterprise agreement be balloted to see if they supported the taking of protected industrial action.

[2] The application was heard at the same time as an application by the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (the CEPU) 1 for a protected action ballot order in respect of its members employed by the Respondent. Due to a failure of the CEPU to notify the Australian Electoral Commission that application was dismissed.2

[3] As the CEPU and AMWU were jointly bargaining for an agreement to apply to the maintenance employees of the Respondent the evidence in each application was taken as evidence in the other application.

[4] As advised at the conclusion of the hearing the application for the ballot order was approved and an order to that effect was issued (PR538344). These are my reasons for that decision.

The evidence

[5] Mr Howard Worthing, an industrial officer with the CEPU, gave evidence that he had carriage of the negotiations on behalf of the CEPU. It was his evidence that he had attended eight meetings with the Respondent. Mr Worthing did not attend the first bargaining meeting. Bargaining commenced on 13 May 2013 and the last meeting occurred on 24 June 2013. It was Mr Worthing’s evidence that the Respondent cancelled a scheduled bargaining meeting that was to be held on 26 June 2013. It was his evidence that the CEPU and the AMWU had put forward a limited log of claims to the Respondent. The CEPU and the AMWU had proposed using the predecessor agreement as the base document. It was his evidence that a draft agreement was provided to the Respondent. It was also his evidence that the unions had proposed to the Respondent some revised clauses dealing with some of the matters in dispute. Agreement had been reached on some items but not all.

[6] It was his evidence that on 24 June 2013 the unions reported back to the Respondent the outcome of the members’ meeting held on 19 June 2013. The unions advised the Respondent that the members had rejected the Respondent’s offer. In response to that the Respondent advised the unions that they thought bargaining was at an impasse and that they would lodge a bargaining dispute notification with the Fair Work Commission (the Commission). Mr Worthing indicated that the CEPU was willing to continue meeting with the Respondent to negotiate an agreement.

[7] Mr Worthing acknowledged in cross examination that the unions had not provided a written response to the Respondent’s proposal. It was his evidence that the response had been verbal.

[8] Mr Worthing was asked if he had given the Respondent any written material in support of the CEPU’s claim. Mr Worthing said that he had talked about the claims and the reasons behind them but no written material had been provided. When specifically asked if he had provided a written explanation for the wage increase claimed Mr Worthing answered no.

[9] Mr Worthing, in re-examination, gave evidence of documents that had been provided by the unions to the Respondent which included the log of claims and some draft agreements. It was his evidence that the parties had initially agreed to work off the predecessor agreement but the Respondent changed its view on this and negotiations had subsequently centred on the log of claims.

[10] Mr Lou Malgeri gave evidence that he had carriage of the negotiations on behalf of the AMWU. He sent the log of claims and draft agreement to the Respondent on 18 May 2013.

[11] He had attended all but two meetings. He last attended a meeting on 17 June 2013. It was his evidence that his purpose in meeting with the Respondent was to negotiate an agreement.

[12] It was his evidence that the Respondent had provided a written response to the log of claims. In cross examination he said that the unions’ response to that proposal had been put verbally. It was his evidence that he had put written material in support of the claims. He indicated that this written material was the draft agreements provided to the Respondent. He was asked if any written material had been provided to support the wages claim. He acknowledged that the wages was an ambit claim but no other written documentation had been provided to the Respondent.

[13] Mr Malgeri accepted that there had been negotiations over machinery issues which were separate to what he called costs issues. He accepted that no written material had been provided to the Respondent to support the cost claims.

[14] Mr Malgeri, in re-examination, advised that he had not provided the Respondent with a verbal justification for the claims. It was his view that he was not obliged to provide that justification.

[15] Ms Maureen Kennedy is employed by the Respondent as the Production Engineering and Reliability Manager and she is the lead negotiator for the agreement.

[16] It was her evidence that the unions provided some written material about the limited tenure claim and some other minor matters but the Respondent had not received any written material from the unions in support of the wage claim or overtime at double time.

[17] Further it was her evidence that the unions did not provide any response to the Respondent’s counter proposal.

[18] It was her evidence that bargaining commenced on 23 April 2013 when the Respondent sent the unions and the employees a letter but the unions did not send their log of claims until early May. It was her evidence that there was a lack of urgency and genuineness on the part of the unions.

[19] It was her evidence that the Respondent had been open and frank about its position particularly in light of the transformation announcements. The Respondent had genuinely tried to explain the constraints under which it was operating, in particular the cost of manufacturing in Australia. It was her evidence that the Respondent had tried to explain its position to the unions and to negotiate a new agreement.

[20] It was her evidence that during the negotiating meetings when the unions were asked to provide an explanation of the claims that very little explanation was given. However she accepted that the unions were there to negotiate an agreement.

[21] It was her evidence that the unions were not genuinely trying to reach an agreement because, despite being verbally advised that the 6% wages claim was an ambit claim, the unions provided no material to support the claim. She was surprised that the unions did not put forward a counter proposal after the mass meeting on the 19 June 2013 when the union members had rejected the company’s proposal. Further she was surprised that the Respondent was not advised in writing that the offer was rejected and that there was no justification or reason given for that decision. She accepted that the Respondent, at the last meeting, told the unions that the negotiations were at an impasse and that they would approach the Commission for assistance with bargaining. It was her evidence that it was inappropriate for the unions to apply for a ballot while that process was on foot.

The Legislative Framework

[22] Section 437 of the Act provides as follows:

“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.

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.”

[23] Section 438 of the Act provides as follows:

“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.”

[24] Section 440 of the Act provides as follows:

“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.”

[25] Section 443 of the Act provides as follows:

“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.”

The Requirements

[26] There is no dispute that the AMWU and the CEPU are bargaining representatives of employees to be covered by the agreement. Further there is no dispute that the applications specify the group of employees who are to be balloted and the questions to be put to the employees who are to be balloted including the nature of the proposed industrial action.

[27] There is no dispute that the nominal expiry date of the predecessor agreement has passed.

[28] Further the AMWU served a copy of the application on the employer and the Australian Electoral Commission.

[29] What is in dispute in this matter is whether the AMWU and the CEPU are genuinely trying to reach an agreement with the Respondent.

[30] The Respondent submitted that the unions were not genuinely trying to reach an agreement. In support of that submission the Respondent relied on the decision of Senior Deputy President Richards in Construction, Forestry, Mining and Energy Union v Theiss Pty Ltd in which he said:

“[22] In ordinary circumstances, the statutory test under s.433 of the Act in that regard is as stated by the Full Bench in Re: TMS:

At the very least one would normally expect the applicant to be able to demonstrate that it had has clearly articulated the major items it is seeking for inclusion in the agreement and to have provided a considered response to any demand made by the other side.”

[31] It was submitted that the unions had not provided any considered response to the Respondent’s proposal and the unions had not provided any justifications for their ambit claim. The Respondent relied on Mr Malgeri’s evidence that he did not consider it necessary to justify the ambit claim.

[32] The unions submitted that they were genuinely trying to reach an agreement. The unions submitted that that there was no evidentiary basis on which it could be concluded that the unions were not genuinely trying to reach an agreement. There is no evidence that the unions had another purpose in seeking the ballot. 3

[33] It was submitted that the unions had made claims, proposed an agreement and had participated in negotiations and made changes to their proposed agreement.

Conclusion

[34] I do not accept the submissions of the Respondent that the statutory test the unions must meet is that they must be able to demonstrate that they had clearly articulated the major items they were seeking for inclusion in the agreement and to have provided a considered response to any demand made by the other side.

[35] The paragraph of the decision of Senior Deputy President Richards referred to by the Respondent is drawn from the decision of the Full Bench in Total Marine Services Pty Ltd v MUA 4. The Total Marine Services decision was subsequently considered by the Full Bench in the JJ Richards 5and the principle set out in paragraph 22 of Senior Deputy President Richards’ decision was rejected. The Full Bench discussed circumstances where a party may not articulate a major claim. For example, a wages claim may not be articulated at all until other items on the bargaining agenda are resolved and the parties could still be found to be bargaining in good faith and genuinely trying to reach an agreement. As was submitted here, it was not unreasonable for the unions to reassess their wages claim after negotiation on the other items of their claim are finalised. I therefore do not accept that the failure of the unions to articulate their wages claim or to put a counter proposal to the employer’s claim means that they are not genuinely trying to reach an agreement.

[36] I also do not accept that the failure of the unions to provide written responses to the Respondent’s counter proposals or written justifications for their claims means that they are not genuinely trying to reach an agreement.

[37] The AMWU, along with the CEPU, has made claims, proposed an agreement and participated in negotiations. The Respondent cancelled a bargaining meeting having told the unions that bargaining was at an impasse. The unions have stated that they will continue to participate in bargaining.

[38] The Respondent submitted that this application was premature because it was seeking the assistance of the Commission with bargaining. That however is not a relevant criteria.

[39] This application, and its outcome, does not affect the progress of the continuing negotiations between the parties.

[40] For the reasons set out above I am satisfied that the AMWU has satisfied the statutory prerequisites for a protected action ballot order and I am satisfied that the AMWU is genuinely trying to reach an agreement.

DEPUTY PRESIDENT

 1   B2013/987

 2   [2013] FWC 4214

 3   J.J. Richards & Sons Pty Ltd v Transport Workers’ Union of Australia [2010] FWAFB 9963 at [63]

 4   [2009] FWAFB 368 at PN 32

 5   JJ Richards op cit at [85]-[89]

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