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

[2012] FWA 4386

[2012] FWA 4386

FAIR WORK AUSTRALIA

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
Harvey Mechanical Installation Pty Ltd
(B2012/777)

COMMISSIONER BULL SYDNEY, 22 MAY 2012

Proposed protected action ballot by employees of Harvey Mechanical Installation Pty Ltd

[1] This is an application made by the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (the Union) pursuant to s.437 of the Fair Work Act 2009 (the Act) filed in Fair Work Australia (FWA) on 14 May 2012.

[2] Under s.437 of the Act, a bargaining representative of an employee who will be covered by a proposed enterprise agreement may apply to FWA for an Order requiring a protected action ballot to be conducted (within a specified period) to determine whether employees wish to engage in particular protected industrial action for the agreement. The specific terms of s.443 are repeated below:

443 When FWA must make a protected action ballot order

(1) FWA 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) FWA 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) FWA 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] The application for a protected action ballot is brought against Harvey Mechanical Installation Pty Ltd (Harvey Mechanical) an employer in the air conditioning ducting installation industry. It was accepted by all parties that the last enterprise agreement negotiated was the “Harvey Mechanical Installation Pty Ltd On-Site Construction Enterprise Agreement for Sydney 2005-2008.”

[4] Before industrial action will constitute protected industrial action for the purposes of the Act, the applicant must satisfy a number of statutory obligations upon the otherwise mandatory obligation on FWA to make a protected action ballot, including those set out in s.443. Subsection 443(1)(b) requires that FWA be satisfied that the applicant has been, and is, genuinely trying to reach agreement with the employer of the employees who are to be balloted.

[5] In this application, the Union as the bargaining representative relied on the evidence of their industrial officer Mr Greg Cummings and tendered a witness statement 1.

[6] Harvey Mechanical was represented by its Managing Director, Peter Harvey who opposed the application, gave evidence and made submissions.

Background

Evidence of Greg Cummings

AMCA Negotiations

[7] Mr Cummings stated that he was the responsible officer for the AMWU’s members in the construction industry who install air conditioning ducting on commercial projects. He understood that Harvey Mechanical was a member of the Air Conditioning and Mechanical Contractors Association (AMCA).

[8] A mass meeting of the AMWU’s members working in the on-site air conditioning industry was held on 18 May 2011 following which an industry log of claims was drafted. Between August 2011 and November 2011 discussions and meetings with the AMCA were held including the tabling of the log of claims. Between December 2011 and February 2012 Mr Cummings took annual leave.

[9] In March 2012 suffice to say Mr Cummings attempted to continue the industry negotiations with AMCA without success.

[10] Mr Cummings’ evidence was that on 20 April 2012 he received a phone call from Kim Henshaw, AMCA’s NSW Executive Director and it was agreed that a further meeting would be held on 1 May 2012.

[11] On 27 April 2012, he rang Peter Verberne the Executive Officer Human Resources AMCA to ask what his “riding instructions” were going to be for the 1 May 2012 meeting. Mr Verberne responded that the only way to get an increase in wages and or conditions would be through productivity offsets.

[12] Mr Cummings asked that this position be put in writing, and on 30 April 2012 he received an email from Mr Henshaw stating that while AMCA members were ready to negotiate a new agreement there should be a clear understanding that any wage increases must be paid for by corresponding productivity offsets.

[13] No evidence of any further industry negotiations was called.

Harvey Mechanical Negotiations

[14] On the 20 March 2012 Mr Cummings sent a letter addressed to “The proper officer Harvey Mechanical Installation Pty Ltd” notifying the company that the Union wished to commence bargaining for an enterprise agreement and requesting a response within 7 days.

[15] On 27 April 2012 Mr Cummings sent an email to Peter Harvey the Executive Director stating:

“Hi Peter,

Attached is a draft copy of the Sheeties [sic] agreement, are you going with the AMCA or are you going alone?”

Mr Cummings sent a further email on 30 April 2012 which stated:

“Hi Peter,

Could you please suggest a suitable date to meet for negotiation regarding enterprise agreement?

Could you please reply by close of business Wednesday 2 May 2012?”

[16] On 1 May 2012 Mr Harvey responded by email in the following terms:

“Hi Greg,

I am available Friday.

Should we say 12.20pm at the Albion Hotel

Bring the Union credit card.”

[17] On receipt of this email Mr Cummings telephoned Mr Harvey that day and outlined a number of the Union’s claims. Mr Harvey expressed reservation about some items of the log of claims and advised he wished to see how the negotiations between the Union and the AMCA progressed and he would then review his position 2.

Mr Harvey

[18] Mr Harvey made brief submissions and gave evidence. He stated that the negotiations between the Union and AMCA had nothing to do with enterprise bargaining with Harvey Mechanical 3. Contrary to the Union’s understanding Mr Harvey stated that Harvey Mechanical was not a member of AMCA, although another company of which he was a shareholder was a member.

[19] Mr Harvey’s objection to the ballot issuing was that there hadn’t been any negotiation with his company over an enterprise agreement other than a 20 minute telephone conversation 4.

[20] Mr Harvey submitted that “... surely we have to have one meeting. We actually suggested a meeting...” 5.

Union submissions

[21] Mr Walkaden for the Union did not associate the industry negotiations between the Union and AMCA with Harvey Mechanical 6 but rather relied on Mr Harvey’s telephone response to Mr Cummings that he was going to see how the negotiations between the Union and the AMCA progressed and would review his position after those negotiations had concluded.

[22] The Union’s position was that the employer had “hitched his caravan” to the industry negotiations, and because the industry negotiations were at an “impasse” then ipso facto so too were the enterprise negotiations with Harvey Mechanical.

[23] The Union referred the Tribunal to a number of authorities concerning the meaning of genuinely trying to reach agreement and submitted that the application met all the tests required by these authorities. The authorities were:

• Total Marine Services Pty Ltd v Maritime Union of Australia[2009] FWAFB 368 (TMS)



• J.J. Richards & Sons Pty Ltd v Transport Workers’ Union of Australia[2010] FWAFB 9963 (JJ Richards No 1)



• J.J. Richards & Sons Pty Ltd v Fair Work Australia [2012] FCAFC 53



• John Holland Pty Ltd v AFMEPKIU and Others[2010] FWAFB 526

The legislation

[24] In the interpretation of a statute, a construction that would promote the purpose or object underlying the statute shall be preferred to a construction that would not promote that purpose or object 7.

[25] The objects of the Act emphasise collective bargaining at the enterprise level which deliver productivity benefits.

[26] Part 2-4 - Enterprise Agreements contains at s.171 - Objects of this Part which state

171 The objects of this Part are:

to provide a simple, flexible and fair framework that enables collective bargaining in good faith, particularly at the enterprise level, for enterprise agreements that deliver productivity benefits; and

...

(My emphasis added)

[27] The Full Bench in TMS were concerned with a factual matrix not dissimilar to the present application where there was initially industry negotiations which broke down and led to enterprise negotiations. At paragraphs 31 and 32 of the Full Bench decision a formulaic approach to applying the statutory test under s.443(1)(b) is eschewed.

[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. [Australian Industry Group v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union Print T1982; Re Media, Entertainment and Arts Alliance PR928033] 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. ....

And continued:

[36] In this conclusion we believe that the Commissioner fell into error. It is clear on the evidence that the negotiations involved limited face to face meetings and limited articulation of many of the claims. Certain matters were being dealt with in concurrent industry negotiations. Many items were only set out in a list of headings and were not explained or discussed. The wage claim had not been specified. There is nothing to suggest that in taking the steps that it did, the MUA was other than genuine. Nevertheless, in our view it cannot be said in these circumstances that the MUA had genuinely tried to reach an agreement. The steps it had taken were preparatory to developing an agreement but in our view insufficient to satisfy the test its application needed to meet. The error made by the Commissioner involves both a mistake of fact and an error of principle.

(My emphasis added)

[28] JJ Richards No 1 in essence addressed the question as to whether a protected action ballot order could be made where bargaining had not commenced and a majority support order had not been obtained by the applicant, although the appeal was upheld on other grounds. The majority decision stated in respect of paragraphs 31 and 32 of TMS above:

[83] ...we entirely agree with and endorse those observations.

[29] In the JJ Richards Federal Full Court decision Flick J stated:

[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.

(My emphasis added)

[30] In the Federal Court decision of Wesfarmers Premier Coal Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (No 2) 8, French J (as he then was) made the following comments about the meaning of genuinely trying to reach agreement:

[85] Although it was baldly submitted on behalf of Premier Coal that there had been no genuine attempt to reach agreement prior to the July strike action, it is clear that the discussions which had ensued in relation to the proposal for a certified agreement under the Workplace Relations Act subsumed, and were in a sense a continuation of, the extensive negotiations over many months that had already occurred in relation to the Enterprise Agreement proposal. The use of the draft Enterprise Agreement as the basis for the development of a certified agreement reinforces that proposition. Given the extent of the negotiations about the Enterprise Agreement and the involvement of basically the same personnel as were involved in the discussion of the certified agreement, I am satisfied that in those circumstances, on the balance of probabilities, the relevant officers of the AMWU (Cth) had, before the strike, genuinely tried to reach agreement with Premier Coal.

(My emphasis added)

[31] As noted by the majority in JJ Richards No 1 (paragraph 58) the word “genuine” includes as defined by the Macquarie Dictionary “being truly such real”. To give full meaning to the expression genuinely trying to reach an agreement, the Tribunal must be satisfied that the means undertaken by the Union to reach an agreement are “truly such” as to reach an agreement; or are “real” efforts to reach an agreement.

[32] Establishing that a party wants to reach an agreement will not answer the question of whether the efforts made are “truly such” as to reach an agreement; or are “real” efforts to reach an agreement 9.

Conclusion

[33] What is clear from the above authorities is that each application turns on its own circumstances. The conduct of the Union must be examined and assessed for the purpose of determining as a matter of fact whether it has been, and is, genuinely trying to reach an agreement. This demands an examination of all of the steps and actions taken by the Union in genuinely trying to reach an agreement, separately and independently of whether it simply has the objective to reach an agreement.

[34] The negotiations to date between the parties have consisted of:

• 20 March 2012 - Correspondence from AMWU State Secretary to the proper officer Harvey Mechanical notifying a wish to commence bargaining;



• 27 April 2012 - Email from Union to Company attaching draft copy of draft industry agreement;



• 30 April 2012 - Email from Union to Company requesting a suitable date to meet for negotiations regarding enterprise agreement; and



• 1 May 2012 - Response email from Harvey Mechanical advising of a suitable date for an enterprise agreement meeting, followed by 20-30 minute phone conversation over agreement content between the parties.

[35] On the facts presented I cannot be satisfied the union has genuinely tried to reach an agreement with the Respondent employer.

[36] To conclude otherwise on the facts before the Tribunal would be to reduce the requirement under s.443(1)(b) to nothing more than a perfunctory exercise.

[37] The submission put by the Union that the negotiations with Harvey Mechanical were at an impasse cannot be sustained. The AMCA position on behalf of its members was known to the Union on 27 April 2012 via a telephone call with Peter Verberne Executive Officer Human Resources AMCA and confirmed by email on 30 April 2012.

[38] To conclude that the negotiations between the parties were at an impasse flies in the face of what has been presented to the Tribunal. Unlike the facts in JJ Richards No 1, the employer has not resisted entering into bargaining with the Union and there simply has not been when “considering the extent of progress in negotiations and the steps taken in order to try and reach an agreement” evidence of a genuine attempt to reach an agreement.

[39] On 1 May 2012 Harvey Mechanical advised by email that they were available for an enterprise agreement meeting, that meeting never proceeded. No evidence was presented to the Tribunal that the Union attempted in any way to genuinely try and reach an agreement following the employer’s email that they were prepared to attend a meeting. Nor was there any evidence before the Tribunal that the Union made attempts to reschedule the meeting or to continue in any meaningful way to ventilate the issues between the parties for the purposes of genuinely trying to reach agreement.

[40] The Union has relied on the employer’s comment that the employer would review their position after the industry negotiations with AMCA had concluded. One would have expected that at the very least, a party genuinely trying to reach an agreement would have put to the employer that the industry negotiations had concluded by way of being at an impasse (even though this appears to have been known to the Union on 30 April 2012) and sought the employer’s position in view of this.

[41] Following the alleged impasse in the industry negotiations with AMCA, which Harvey Mechanical took no part in; the Union has taken the AMCA’s response to equate to an impasse at the enterprise level for negotiations with Harvey Mechanical. Advice that Harvey Mechanical’s position would be reviewed following the negotiations between the Union and AMCA is not akin to the enterprise negotiations being at an impasse. There was no evidence presented that Harvey Mechanical was advised that the AMCA negotiations were at an impasse.

[42] No attempt was made by the Union to confirm the position of Harvey Mechanical, no opportunity was given to Harvey Mechanical to review their position as had been requested; no meeting took place as requested by the Union and agreed to by the employer.

[43] In the circumstances I find that, the Union has not made a genuine attempt to try and reach agreement with Harvey Mechanical for an enterprise agreement prior to filing this application.

[44] The application for a protected action ballot order in the existing circumstances is premature in the sense described by the Full Bench in TMS.

Order

[45] The application is therefore dismissed.

COMMISSIONER

Appearances:

A Walkaden for the Applicant.

P Harvey for the Respondent.

Hearing details:

2012
Sydney
15 May.

 1   AMWU 1.

 2   Transcript PN 109.

 3   Transcript PN 42.

 4   Transcript PN 274.

 5   Transcript PN 102.

 6   Transcript PN 157, 197.

 7   Acts Interpretation Act 1901, s.15AA.

 8 [2004] FCA 1737.

 9   T. Caspersz, Bargaining and the Protected Action Ballot Order (November 2011) WA Law Society Brief.

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