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

Case •

[2025] FWC 122

•

14 JANUARY 2025
[2025] FWC 122

FAIR WORK COMMISSION
DECISION

Fair Work Act 2009

s.236 - Application for a majority support determination

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

Polyaire Pty Ltd

(B2024/998)

COMMISSIONER ALLISON

MELBOURNE, 14 JANUARY 2025

Majority support determination – jurisdictional objection – whether the AMWU is a ‘bargaining representative’ – eligibility of employees to join the AMWU – construction of Union Rules

  1. This decision relates to five workers employed in a warehouse in Clayton in the South-East of Melbourne (the relevant employees).[1] These workers have decided that they want to join a union and negotiate an enterprise agreement with their employer Polyaire Pty Ltd (Polyaire).

  1. On its website Polyaire describes itself as “An international manufacturer of quality equipment for [heating, ventilation and air conditioning (HVAC)] systems supplying air filters, insulated flexible ducting, air grilles and vents, and fittings.”[2] (emphasis added). In reality, Polyaire’s predominant business is now the importation and wholesaling of HVAC components.[3] Notwithstanding this, manufacturing still forms a small, but important, part of Polyaire’s overall business. Polyaire has maintained some manufacturing in Australia to enable it to customise HVAC components. HVAC components manufactured by Polyaire generate approximately 3.5% of the revenue Polyaire receives through the sale of HVAC products.[4]

  1. Polyaire has a manufacturing site in Adelaide, South Australia as well as manufacturing sites in NSW and Queensland. Polyaire also has 27 branches nationally that receive and dispatch HVAC components, including the Clayton warehouse where the relevant employees work. 

  1. The relevant employees are predominantly engaged in warehouse work, including the receival and dispatch of some goods manufactured at Polyaire’s Adelaide site. On a daily basis the relevant employees also spend some time fitting together pre-fabricated parts before a product is dispatched.

  1. Since March 2024, the Australian Manufacturing Workers’ Union (AMWU) has been trying to bargain an enterprise agreement with Polyaire in respect of the relevant employees. Polyaire has been resistant to entering bargaining for an agreement.

  1. On 7 August 2024, the AMWU made an application to the Fair Work Commission for a majority support determination which, if granted, would require Polyaire to commence bargaining.

  1. Polyaire objects to the application on the jurisdictional ground that the AMWU is not a ‘bargaining representative’.[5] Polyaire argues that the AMWU is not entitled to represent the industrial interests of the employees at the Clayton warehouse under the AMWU’s Rules.

  1. The AMWU claims the relevant employees are eligible to be members of the AMWU under the AMWU Rules. The Rules relied on by the AMWU predominantly involve a consideration of the work performed by the relevant employees and whether it is “in or in connection with” various manufacturing related work.

  1. This decision considers whether the relevant employees are eligible to be members of the AMWU under the AMWU Rules.

  1. As will become apparent for the reasons given below, I have reluctantly found that the AMWU Rules do not cover the relevant employees. I am reluctant because, on the face of it, the primary reason for Polyaire’s objection to the application appears to be to hinder or delay collectively bargaining for an enterprise agreement. I make further comment on this in the conclusion.

  1. I heard this matter over two days on 17 October 2024 and 29 October 2024.

  1. Polyaire relied on the evidence of Mr Adam Cottam, General Manager of Polyaire and Mr Daniel Mills, Victorian Commercial Manager.

  1. The AMWU relied on the evidence of Mr Robert Guanizo, warehouse worker and AMWU delegate, and Mr Lewis Farrugia, AMWU Organiser. Polyaire did not require Mr Farrugia for cross examination.

PART 1: Legislation, AMWU Rules, ResMed and Legal Principles

1.1 Legislative Provisions

  1. Section 236(1) of the Fair Work Act 2009 (FW Act) provides that a ‘bargaining representative’ of an employee who will be covered by a proposed single-enterprise agreement may apply to the Commission for a determination that a majority of employees who will be covered by the agreement want to bargain with the employer that will be covered by the agreement.

  1. Pursuant to s.176 of the FW Act, a bargaining representative includes an ‘employee organisation’ if:

  • An employee who will be covered by the agreement is a member of the employee organisation (s.176(1)(b)(i)); and

  • The employee organisation ‘is entitled to represent the industrial interest of the employee in relation to work that will be performed under the agreement’ (s.176(3))

  1. It is uncontested that the AMWU is an ‘employee organisation’ for the purposes of the FW Act[6] and that the relevant employees have joined the AMWU. It is contested whether the AMWU is entitled to represent the industrial interests of the relevant employees in relation to the work they perform under the AMWU Rules. 

1.2 AMWU Rules

  1. The AMWU relies on various provisions under its Rules to cover the relevant employees. Initially the AMWU sought to rely on the following rules 1A(a), 1A(c)(i), 1A(c)(iv), 1C and 1H(a)(i). At the hearing the AMWU withdrew its reliance on 1C and clarified that in relation to rule 1A(a) it is only relying on the trades of “assemblers”, “fitters” and “workers engaged in…kindred trades.”[7]

  1. The Rules, as relevant to this proceeding are reproduced below:

“1A. Without in any way limiting or being limited by sub-rules 1B, 1C, 1D, 1E, 1F, 1G, 1H and 1I the Union shall consist of an unlimited number of persons who are employed or usually employed in or in connection with the following trades or calling or branches thereof:

(a)   …. assemblers, skilled acetylene and electrical welders, aero mechanics, duralium workers, including forgers, fitters, and all other aircraft workers who are employed on the fuselage or engine work, and all workers engaged in the engineering, shipbuilding and kindred trades…..

(c) (i) Producing, making, completing by any process such as oxidising or electroplating, or vitreous enamelling, or repairing, or assisting to produce, make or repair any articles, goods or chattels, in or in connection with the tinplate, tinsmithing, sheet metal working, gas meter making, motor car building or repairing so far as panel beating or sheet metal work is concerned, sheet metal trunk and box making, or canister making industries; and shall include spinners, draw moulders, ceiling fixers, welders, metal polishers and revolving shutter machinists engaged in or on or about sheet metal work…..

(c)(iv) All employees in any establishments connected with manufacture, assembling, dismantling, erecting, replacing, or repairing of agricultural implements, machinery, utensils, flax making machinery, wagon building and irrigation plant; the trades connected with white and black sheet metal working, blacksmiths, general blacksmiths farriers; the manufactories of iron, copper, tin or galvanised iron utensils, stoves, ranges, grates, registers, copper casings or other heating apparatus, domestic appliances made of metal

fireproof or other iron doors, bedsteads, wire-mattresses, or other iron work used in connection with beds, coppersmith wares or parts thereof; porcelain enamelling of steel and iron plates and hollow-ware baths, sinks, cisterns, household utensils and builders’ material or in the manufacture of frit.

1H. Without in any way limiting or being limited by sub-rules 1A, 1B, 1C, 1D, 1E, 1F, 1G and 1I, the Union shall consist of:-

(a)An unlimited number of persons (excepting journalists) who are employed or whose usual occupation is that of an employee in or in connection with:

(i)…… plastics manufacturing or any of the processes of or incidental to the manufacturing of plastics or of goods manufactured therefrom or substitutes therefore;”

(Emphasis added)

1.3 ResMed and Legal Principles

  1. The Full Bench decision in the AMWU v ResMed [8] (ResMed) is of particular relevance to this matter and was referred to at length by both parties. ResMed not only considered the general principles relating to Union Rules interpretation, but it also specifically considered the application of rule 1A(a) of the AMWU Rules including the meaning of assembler and whether ResMed warehouse workers were covered by this rule.

General Principles relating to Union Rules

  1. The general principles applicable to rules interpretation of union eligibility rules were summarised by the Full Bench in ResMed[9] and are set out below: [10]

·“Union eligibility rules will be construed objectively.”

·“The nature of union eligibility rules means that they should be construed liberally rather than narrowly or technically.”

·“It is permissible to have regard to any common understanding among people concerned with relevant industries and particularly with industrial matters of the ordinary application of the words used, and to the previous use of the words in the relevant organisation’s rules and in statutory provisions, decisions, determinations, awards, reports and other papers concerned with the relevant industry or industries.”

·“If there is ambiguity as to the meaning of words in the eligibility rules, assistance may be sought in the terms of the industry rule (subject to it being understood that the scope of the eligibility rule is not restricted by the scope of the industry rule.”

·“Words in an eligibility rule should not be read in isolation such as to give the rule a wide and indefinite scope of operation that is unlikely to have been intended.”

·“Terms used in union eligibility rules should not be interpreted statically in accordance with the meaning they bore at the time that they were first introduced into the rules. Although such terms will have a fixed connotation, they bear a changing denotation - that is, they may be interpreted in accordance with their appropriate current meaning, taking into account changing technologies and methods of work… This may mean that eligibility rules may cover industries or callings not known when the rules were originally drafted.”

·“The words “in or in connection with” are words of expansion. However, for the requisite connection to be established, the work of the employees in question must be referable or significant to the work of the second group of employees with whom there is said to be a connection. It is not sufficient that the work of the relevant employees makes it possible for an employer to conduct a business involving the performance of work by the second group of employees.”

(Citations omitted, emphasis added)

Construction of AMWU rule 1A(a)

  1. The Full Bench in ResMed went on to specifically consider the construction of AMWU rule 1A(a), with reference to Full Federal Court in Federated Tobacco Workers Union of Australia v Amalgamated Metal Workers Union & Anor[11]  (Federated Tobacco Workers). The Full Bench in ResMed held at [37]:

“We consider that the Federated Tobacco Workers Union case stands for the following propositions concerning the construction of rule 1A(a) of the AMWU’s eligibility rules:

(1)   The rule is constructed by reference to “trades or callings”, which are all referable to activities being carried out by employees.

(2)   The expression “in or in connection with” in the opening words are words of expansion, so that in addition to the listed trades or callings, persons who (for example) assist persons who are employed in any of the identified trades or callings will fall within the scope of the rule.

(3)   The concluding words “all workers engaged in the engineering, shipbuilding and kindred trades” are also words of expansion, in that they refer to activities of employees in addition to those of employees in the specifically-identified trades and callings. They are general words intended to catch trades and callings which might be established as technology changes so as to obviate the need to continually vary the rule to add new trades and callings.

(4)   The rule will cover not just “all workers engaged in the engineering, shipbuilding and kindred trades”, but also employees engaged in connection with such workers.”

  1. In addition, the Full Bench in ResMed restated the position of the Full Court in Federated Tobacco Workers that in relation to “in or in connection with” there was no requirement that “a person spend the whole of his or her time engaged in the activities of the requisite type. The test is based on whether the person is engaged substantially in those activities.”[12] 

Assembler

  1. The Full Bench in ResMed considered the term assembler under rule 1A(a) and found:

“An employee who is engaged to perform assembly work as part of the process of manufacture of mechanical or electrical appliances is … an assembler for the purpose of the AMWU’s eligibility rules.”[13]

  1. The Full Bench found that a group of workers who “assembled” ventilators and flow generators were “assemblers of the devices, in that their primary function is, by the use of the techniques and equipment described … to assemble the devices from a number of constituent parts.”[14] Accordingly the Full Bench found the group of workers who assembled ventilators were covered by rule 1A(a).

  1. The Full Bench found that assembly work could include merely clipping or pushing component parts together. [15] The fact that components were manufactured by external suppliers was “a ubiquitous feature of modern manufacturing” and did not alter the character of the assembly work.[16]

ResMed Warehouse Employees

  1. In Federated Tobacco Workers the Federal Court found that employees engaged as Storemen, in addition to a number of other classifications, were eligible to be members of a predecessor of the AMWU under rule 1(A)(a) on the basis that they spent a substantial part of their working time in assisting tradesmen performing their duties.[17] The Full Bench in ResMed, when considering whether ResMed employees engaged in the Warehouse Group were covered by rule 1A(a) distinguished the Federated Tobacco Case on the basis that the store workers in Federated Tobacco Case delivered parts directly to assemblers. In comparison ResMed warehouse workers – who either received, stored and dispatched assembled products or received, stored and retrieved raw materials (but did not deliver the raw materials to assemblers) - did not have any “substantial connection” with any other working group. Despite the operation of the warehouse being necessary for the functioning of ResMed’s business, the Full Bench held there was not enough connection with manufacturing work and therefore the warehouse operators were not eligible to be members of the AMWU. [18]

PART 2: Background and Context

  1. The following paragraphs outline the factual background to the matter. I note that significant portions of the background are contested between the parties. Where findings of fact or other commentary on the evidence before me is required, I have recorded my views in this section.

2.1 Warehouse Duties

  1. The Polyaire Clayton warehouse was established in 2018. It is a typical warehouse facility with dedicated areas for the receipt and dispatch of goods (where product will be loaded or unloaded from trucks, vans or other vehicles) and areas where product is stored. The warehouse also includes workbenches (discussed further below) and a counter sales area – where the counter sales employee takes customer orders and sales enquiries.

  1. On the evidence before me the overwhelming majority of work performed by the relevant employees – approximately 95% – is typical warehouse work. Both Mr Mills for Polyaire and Mr Guanizo for the AMWU provided evidence to this effect.[19] The relevant employees’ primary duties include the unloading of trucks and other vehicles, the storing of goods, the picking and packing of products in accordance with a pick slip and the loading of products on trucks or other vehicles for dispatch. A significant proportion of the relevant employees’ time is spent on a forklift.[20]

  1. The five full-time warehouse employees are divided into two teams – the commercial team (responsible for products to do with commercial orders) and the domestic team (responsible for products to do with residential orders). Mr Guanizo and two other employees are in the commercial team, and two employees are in the residential team. However, employees in the commercial team will perform work in the domestic team, and vice-a-versa, to help out when required.

  1. The Clayton warehouse receives, stores, and dispatches one particular component manufactured at the Polyaire Adelaide site – the PM4 grilles. PM4 grilles are made from aluminium and do not have plastic components.[21] There are two deliveries of PM4 grilles per week with currently about 3 pallets per delivery.[22]

  1. With the exception of the PM4 grilles, the Clayton warehouse does not receive any other goods manufactured by Polyaire from any of its manufacturing sites in South Australia, NSW or Queensland.

  1. The PM4 grilles manufactured by Polyaire represent approximately 4% of the total items sold from the Clayton Facility. The remaining approximately 96% of products sold from the Clayton warehouse are items manufactured by external suppliers.[23]

  1. There is some contest between the parties in relation to how much time the relevant employees spend dealing with product from Adelaide.

  1. Mr Guanizo gave evidence that he and his co-workers collectively spend around 2-4 hours a day dealing with PM4 grilles.[24] Mr Guanizo gave evidence this work includes receiving the goods from Adelaide, unloading the PM4 grilles and placing them in storage, opening the pallets from Adelaide and separating customer orders, identifying and labelling the products for commercial orders and picking PM4 grilles as part of a dispatch order, including prioritising urgent orders.[25]

  1. Mr Mills gave evidence that on the two days when the PM4 grilles are received, it takes approximately 30 minutes to unload the truck, and then approximately an hour to complete labelling and identification.[26] On a daily basis the relevant employees will wrap, label and load outbound deliveries which may include PM4 grilles. In relation to commercial orders this can take from 10-20 minutes for smaller outbound deliveries to 1-2 hours for larger outbound deliveries.[27] Mr Mills did not give evidence in relation to how much time the relevant employees in the domestic team spend performing warehouse duties in relation to PM4 grilles.

  1. I did not have enough evidence before me to accurately determine the amount of time spent by the relevant employees performing warehouse duties in relation to PM4 grilles. I find the relevant employees would spend somewhere between 1 – 4 hours a day dealing with PM4 grilles – although some of this time would be preparing orders of which PM4 grilles are only a small part. However, for reasons that will become apparent below I have decided it does not matter exactly how much time is spent by the relevant employees performing warehouse duties in relation to PM4 grilles.

2.2 Fitting and Adjusting Duties

  1. In addition to typical warehouse duties, the relevant employees are required to spend some time fitting together pre-fabricated components and/or adjusting other components prior to dispatch. These duties may involve the use of tools such as hand drills, a hand rivet gun, a vice grip, a mallet and a screwdriver, and can be performed on the work bench.[28]

  1. There was evidence before me regarding the fitting or adjusting of three different components which I describe in some detail below as the characterisation of these duties was contested.

2.2.1Connect Fittings

  1. Connect Fittings (referred to by the AMWU as Y, BTO and DBTO and referred to by Polyaire as “quick connect fittings”) are HVAC components designed to direct air flow.[29]

  1. The Connect Fittings were designed by the Polyaire engineering team[30] and are manufactured by a supplier in Malaysia.[31] In the last 12 months 6597 Connect Fittings have been sold from the Clayton warehouse.[32]

  1. For customised orders – differently sized spigots, dampers or reducers (the attachments) may need to be attached to the Connect Fittings to facilitate connection to a duct or to modify the air flow.[33] The attachment of spigots, dampers or reducers for customised orders is done by the relevant employees at the Clayton warehouse.        

  1. The attachment process can be done by hand as the Connect Fitting and the attachments are designed to clip together. However, this may also be done with the aid of a mallet. Mr Guanizo gave evidence that he always used a mallet for this job to protect his hands.[34] Both parties gave evidence to the effect that a mallet was also used because it was not uncommon for a component to be a slightly deformed and therefore a bit of force was required to make the attachment.[35]

  1. Mr Mills demonstrated the attachment of a spigot to a Y shaped Connection Fitting in the hearing. The process took under 1 minute. However, Mr Guanizo gave evidence that often it can take longer because the component will be an irregular shape.[36]

  1. The majority of Connect Fittings are attached to orders for residential properties and therefore dealt with by the domestic team. A medium domestic order will have between three to six Connect Fittings[37]. In comparison a large commercial order is only likely to have one or two Connect Fittings. Accordingly, the domestic team does more Connect Fittings than the Commercial team.

2.2.2Attaching Dampers to Quick Fix Bar Grilles

  1. Polyaire imports bar grilles from a supplier in China which are used to install into exhausts in toilets, kitchens or other commercial facilities.[38] These bar grilles usually arrive at the warehouse with a damper already affixed. Between 29 April 2024 – 28 May 2024, Polyaire received 880 Quick Fix Bar Grilles that did not have the damper affixed. To rectify this issue Polyaire sourced a damper to fit the bar grilles, and the relevant employees at Clayton have been fitting the damper to the Quick Fix Bar Grilles.

  1. To fit the damper to the Quick Fix Bar Grilles an employee needs to fit the damper in the neck of the bar grill matching the screw holes in the damper with the pre-drilled holes in the neck. The damper then needs to be secured with a vice grip. The employee then screws the damper to the Quick Fix Bar Grilles.[39]

  1. At the date of hearing 124 of the 880 Quick Fix Bar Grilles had been fitted with dampers. The Quick Fix Bar Grilles are generally only fitted with a damper when they form part of an order. Once the remaining 756 Quick Fix Bar Grilles have be sold, this task will not be required again.

  1. Mr Mills gave evidence that attaching a damper to the Quick Fix Bar Grilles takes him about 1 minute.[40] Mr Guanizo gave evidence that the procedure took longer than this but did not specify how long.[41]

2.2.3Attaching installation beams to Swirl Cushion Boxes

  1. Between 11 January to 2 February 2022 Polyaire in Clayton received 501 Swirl Cushion Boxes from a Malaysian supplier without the cross brace installed. Usually, the Swirl Cushion Box comes with the cross bar attached, but a temporary decision had been made by Polyaire to order the Swirl Cushion Box without the cross bar installed to assess whether it reduced the cost of freight. Following the delivery of Swirl Cushion Boxes on 2 February 2022, Polyaire reverted to receiving Swirl Cushion Boxes with the cross bar already attached.[42]

  1. Between January – September 2022 employees at Clayton installed cross bars on 446 of 501 Swirl Cushion Boxes.[43]

  1. Installing a cross brace on a Swirl Cushion Box involves inserting the cross bar to fit in line with predrilled holes and driving four screws into the holes. Mr Mills gave evidence that the job took around 1 minute,[44] but in any event that no bars had been installed since September 2022.[45] Mr Guanizo conceded he could not remember when he had lasted attached the installation beam to a Swirl Cushion Box, but it could be a “long time” ago.[46]

  1. I accept Mr Mills’s evidence that that there has been no requirement to install cross braces on Swirl Cushion Boxes since September 2022.

2.2.4Time Spent by the Relevant Employees Performing Fitting and Adjusting Duties

  1. Both parties led evidence on how long the relevant employees spent performing the fitting and adjusting duties.

  1. Noting that the relevant employees have not worked with Swirl Cushion Boxes for a significant period, I have only considered the time spent by the relevant employees on the Connect Fittings and the Quick Fix Bar Grilles.

  1. Mr Guanizo gave evidence that he spent between 5-10 minutes a day performing fitting and adjusting duties.[47] Mr Mills gave evidence that a generous estimate of the time Mr Guanizo would take to perform fitting and adjusting duties on the Connect Fittings and the Quick Fix Bar Grilles is an hour and twenty minutes a week (or 16 minutes a day).[48]

  1. Mr Guanizo – who sometimes performs work in the domestic team – gave evidence that his co-workers in the domestic team spend around 30 – 60 minutes a day performing the fitting and adjusting duties.[49] Mr Mills did not give evidence on how much time employees in the domestic team spent performing these duties.

  1. In relation to the Connect Fittings, I accept Mr Guanizo’s evidence that while a standard shaped Connect Fitting takes less than a minute, often more time is required given the component may be misshaped. I find that fitting the attachments to the Connect Fitting can take between under 1 minute to 5 minutes.

  1. Given this finding, I am of the view that employees in the domestic team may spend 30-60 minutes a day given approximately 127 Connect Fittings are sold from the Clayton warehouse a week[50], and the majority of Connect Fittings are dealt with by the domestic team. 

  1. I acknowledge Polyaire’s evidence that the duties in relation to Quick Fix Bar Grilles are temporary and minimal given only 124 have been fitted in the six months before hearing. I also acknowledge that the duties in relation to the Cushion Swirl Box have ceased. However, it appears clear that the primary fitting duty, associated with the Connect Fittings, is ongoing work. In addition, Polyaire conceded that it may require the relevant employees to fit together or adjust other components in the future.[51]

  1. Accordingly, I find the relevant employees in commercial are required to spend 5 – 10 minutes a day on fitting and adjusting duties and the relevant employees in the domestic team are required to spend between 30 – 60 minutes a day performing fitting and adjusting duties.

2.3 Job Descriptions and Award Coverage

  1. Polyaire’s job descriptions for the roles performed by the relevant employees (as dated August 2022) are entitled “Storeperson/Driver” or “Storeperson” include the following[52]:

“Role Purpose

The Warehouse/stores position is responsible for monitoring the flow of stock into and out of the warehouse and other storage facilities.

Primary Duties and Responsibilities

·Perform functions relating to receipt, storage and dispatch of goods

·Maintain stock at agreed levels and ensure its security

·Assemble goods to satisfy orders, requisitions or schedules and pack appropriately

·Complete documentation for movement of goods & stock records

·Ensure Company equipment and facilities are maintained in good condition

·Delivery of orders as required

·Provide exceptional customer service to all clients

Requirement and Skills

·Forklift Licence

·C Class Driver’s License

·Experience in a similar stores or warehousing role

·Good level of communication skills and rapport-building ability

·Good planning, organisation, and time management skills

·Basic numerical skill and good attention to detail and accuracy “

(emphasis added)

  1. On commencement of employment Mr Guanizo was engaged as a warehouse worker under the C12 classification in the Manufacturing and Associated Industries and Occupations Award 2020.[53] This was reflected in his payslips until around 4 September 2024. In or around 4 September 2024, Mr Guanizo’s payslip changed to reflect reference to the Storage Services and Wholesale Award 2020. On or around 19 September 2024, Mr Guanizo received a memo from Mr Mills stating the following:[54]

“Attention: Clayton warehouse staff: Award-covered employees

Modern Award Coverage

As some of you are aware, your most recent payslip now reflects that the Storage Services and Wholesale Award 2020 (the Storage Award) applies to your employment. Your previous payslip indicated that the Manufacturing and Associated Industries and Occupations Award 2020 (the Manufacturing Award) applied to your employment.

The reason for this adjustment is that Polyaire has formed the view, based on examining the factual circumstances of the business and your position, that it is incorrect to say that the Manufacturing award applies to your employment. Rather, it is the Storage Award which applies. Accordingly, Polyaire is making administrative changes, including in its payroll systems, to reflect this.”

  1. No evidence was given that any terms or conditions of employment were changed as a result of the change of Awards.

  1. Mr Cottam gave conflicting evidence that the change to the Awards has been a “project for 12 months now”[55] or under discussion for eight or nine months.[56] However, Mr Cottam did not have any knowledge of the classifications, duties or positions under the Storage Service Award.[57] Mr Cottam stated that the current proceeding, which was lodged by the AMWU on 7 August 2024, was not considered at all when Polyaire made the decision to change Awards just a few weeks later.[58]

  1. I accept that employers have a clear interest in ensuring they are applying the correct Award. However, the timing of Polyaire’s decision to change Awards, coupled with its lack of operational understanding or imperative to change Awards, makes Mr Cottam’s claim that the Award change is unrelated to the majority support determination application very difficult to believe.

PART 3: Are the Relevant Employees Eligible to be Members of the AMWU? 

  1. I now turn to consider whether the relevant employees are eligible to be members of the AMWU under the AMWU Rules.

  1. The AMWU submits that the relevant employees perform work that is covered by the AMWU rules and are therefore eligible to members of the AMWU. The AMWU contends the evidence shows the following:[59]

  1. The relevant employees are employed in the trade of assembler under rule 1A(a); and/or

  2. The relevant employees are employed in the trade of fitter and/or as a worker in kindred trades under rule 1A(a); and/or

  3. The relevant employees are employed in connection with a trade under rule 1A(a); and/or

  4. The relevant employees are employed in or in connection with the repairing or assisting to produce or making goods in or in connection with sheet metal working and sheet metal box making under rule 1A(c)(i); and/or

  5. The relevant employees are employed in or in connection with an establishment, the Clayton Facility, connected with the manufacture and assembling of heating apparatus and domestic appliances made of metal (HVAC equipment)” under rule1A(c)(iv); and/or

  6. The relevant employees are engaged in or in connection on with the manufacturing of plastic goods under rule 1H.

  7. Both parties agreed that the rules identified by the AMWU were “occupational rules” not “industry rules” – that is the “trades”, “callings” or (in the case of Rule 1H) “occupations” listed in the rules are referrable to the activities being carried out by employees, not the industry of the employer.[60]

  1. The overwhelming amount of submissions from both parties addressed rule 1A(a), particularly whether the relevant employees were employed in the trade of assembler and/or employed in connection with a trade under rule 1A. There was very little guidance, and no authorities, given in relation to the construction of rules 1A(c)(i), 1A(c)(iv) and rule 1H. Both parties submitted, in effect, that the approach taken by the Commission in considering the application of rule 1A(a) should be rolled out to the other rules albeit in relation to different trades, callings or occupations.[61]

3.1 Are the relevant employees employed in the trade of assembler under Rule 1A(a)?

3.1.1 AMWU Submissions

  1. The AMWU’s primary contention is that the relevant employees are employed in the trade of assembler, as defined in ResMed and extracted at paragraph [23] above. It argues that the inclusion of “assemble goods to satisfy orders, requisitions or schedules and pack appropriately” in the listed primary duties of the relevant employees, is documentary evidence that their work constitutes assembly work. It further relies on a combination of Mr Guanizo’s evidence that the relevant workers routinely use hand tools commonly associated with manufacturing such as mallets and drills, and a concession by Mr Mills that Polyaire may require these employees to perform similar duties in the future,[62] to establish that assembling goods is a key part of their role.

  1. The AMWU’s secondary line of argument seeks to establish that the duties performed by the relevant employees constitute one part of a greater manufacturing process. To this end, the AMWU submits that Mr Cottam’s and Mr Guanizo’s evidence support an inference that the quick connect fittings are firstly designed by Polyaire in Australia, secondly manufactured by a “related” overseas company, and thirdly finalised by the relevant employees assembling the components at the Clayton site before products are dispatched to customers.[63] It submits that when pictured in this context, Polyaire is involved in the manufacture of these products in “a more direct sense, than as merely a warehouse.”[64] It then follows that the final assembly duties of the relevant employees are essential to the broader manufacturing process.[65]

  1. In reference to the Federated Tobacco Workers test that a person must be “engaged substantially,” the AMWU relies on definitions of “substantial” outlined in multiple cases which considered whether an organisation is a trading corporation for the purposes of the Constitution. These include the United Firefighters’ Union of Australia v Metropolitan Fire and Emergency Services Board[66] that found that 5% of trade as a proportion of the entity’s activities was substantial, and the United Firefighters’ Union of Australia v Country Fire Authority[67] where the Full Bench upheld as little as 2.7% of total revenue is “not insubstantial”, “trivial, insignificant, marginal, minor or incidental”. [68]

  1. In addition, the AMWU claims that multiple dictionary definitions of “substantial,” support a finding that the relevant employees are “engaged substantially” in the trade of assembler. These dictionary definitions of substantial included “something that is or exists as a substance, having a real existence or subsisting by itself,”[69] as well as “of ample or considerable amount, quantity or dimension.”[70]

3.1.2 Polyaire’s Submissions

  1. The core of Polyaire’s submissions revolved around two main themes.

  1. Firstly, Polyaire contends that the fitting and adjusting duties performed by the relevant employees are basic and simplistic in nature and are more akin to “fixing or installing” than assembly. [71] It argues that the work performed in relation to Quick Fix Bar Grilles was a one-off duty assigned to rectify a defective set of orders, while duties relating to Swirl Cushion Boxes are no longer performed by the employees and have not been since 2022. Finally, it submits that Connect Fittings are “like Lego” and “designed to be put together after the fact,”[72] and cannot be capable of being “assembled” in the traditional sense. Therefore, it claims that no manufacturing processes occur at the Clayton site, and that the relevant employees perform warehouse duties and are not engaged as assemblers, which is supported by their job descriptions being titled “Storeperson/Driver” and “Storeperson”.

  1. Secondly and alternatively, even if any work performed by the relevant employees can be considered “assembly” work, Polyaire submits that the employees cannot be said to be “engaged substantially” in assembly work as required to satisfy the Federated Tobacco Workers test. Polyaire submits that the appropriate industrial authorities which should be referred to when considering the meaning of the phrase “engaged substantially” conduct an enquiry on the “essence of the role” that is being performed.[73]

  1. In this regard, Polyaire refers to a number of authorities including Joyce v Christoffersen[74] (Joyce), in which Gray J found the appropriate inquiry when considering union coverage is to analysis the employee’s “primary function” by “looking at what he or she does in the context of the employer’s organisation of work.”[75] In addition Polyaire relied on The Federated Clerks’ Union of Australia Industrial Union of Workers, W.A. Branch v Cary[76], in which Burt CJ referred to phrases such as “the substantial nature of the employment in terms of the purpose to be achieved by it.”

  1. Following such an enquiry, Polyaire contends that the “essence of the role” of the relevant employees is warehouse work, and therefore the relevant employees are engaged in warehouse work, not the trade of assembler.

3.1.3 Consideration.

  1. I am prepared to accept that the fitting and adjusting duties are assembly work. The duties performed by the relevant workers in fitting together components that will form part of a HVAC system, fit the definition in ResMed of what assembly work may be, including the “clipping or pushing component parts together.” [77] It makes no difference that the components are made by external suppliers.[78]

  1. If an employee was engaged substantially in the fitting and adjusting duties, he or she is likely to be considered employed in the trade of assembler for the purpose of rule 1A(a). I will now consider if the relevant employees are engaged substantially in the trade of assembler.

  1. As stated above at [61] I find that relevant employees in the commercial team spend approximately 5 – 10 minutes a day on the fitting and adjusting duties, and the relevant employees in the domestic team spend between 30 – 60 minutes a day on fitting and adjusting duties.

  1. While the amount of time an employee spends doing an activity at work may have some bearing on whether he or she is engaged substantially in an activity, this alone is not determinative. This matter was considered by Gray J in Joyce, where His Honour considered whether certain employees hired as storepersons were engaged in a clerical capacity such that they were eligible to be members of the Federated Clerks’ Union. Ultimately, Gray J found the employees were not eligible to be members of the Clerks’ Union. In considering this question Gray J made the following comments:

“Much of the evidence before the Court in the present case was concerned with the proportion of the time of each employee concerned which was occupied by what might be described as clerical duties. No doubt the time occupied in the performance of such duties is to be taken into account, but the test of whether a person is engaged in a clerical capacity or in performing clerical work is not a quantitative one. Many people are employed in jobs which require them to do a great deal of recording, but which could not be described as clerical jobs….

A motor vehicle repair workshop might employ a number of motor mechanics., Each motor mechanic might be required to record on job cards the results of his or her labours. Plainly, the primary function of each motor mechanic would be the repair of motor vehicles, and the recording would be a secondary function.” (p272)

…

Ultimately, the primary function of an employee must be determined by looking at what he or she does in the context of the employer’s organisation of work.” (279)

  1. I agree with Gray J’s analysis that when considering whether an employee is engaged in a particular activity, reference needs to be had to the purpose of the role or the “primary function.” This approach appears to be upheld by the Full Bench in ResMed who concluded that a group of workers were “assemblers” because their “primary function” was to assemble devices.[79]

  1. In addition, having reference to the purpose of the role or primary function appears consistent with the application of the “engaged substantially” test in Federated Tabacco Workers. In Federated Tobacco Workers the Full Bench made the following comments in relation to applying the engaged substantially test:

“The test is based on whether the person is engaged substantially in those activities. In this context it is legitimate to ask whether, if [the Employer] were to contract the whole of its maintenance operations to an outside company, it would find it necessary to employ persons in the disputed classifications. On the material before the Court, the answer to that question is that, in all probability, those persons would be employed by the maintenance contractor.”

  1. The hypothetical contracting out exercise allowed the Court to identify the nature of the primary function of the roles in question.

  1. I am not persuaded by the AMWU’s attempts to define “substantial” by reference either to decisions in other bodies of law, or to alternative definitions in the dictionary. Defining “substantial” by reference to a percentage of trading activities done by a corporation, as was considered in Country Fire Authority and Metropolitan Fire and Emergency Services Board, may well have been appropriate in an analysis of the corporations power under the Constitution. However, I do not accept that a transplanting of this test to the realm of industrial relations law can be appropriate, particularly in circumstances where numerous more relevant authorities in industrial relations law provide consistent guidance as to the proper construction of “engaged substantially.” I make similar observations about the AMWU’s reliance on alternative dictionary definitions of “substantial,” and generally speaking, I am inclined to agree with the Respondent’s submissions in this respect.

  1. In the case before me, the primary function or role that the relevant employees are “engaged substantially” in is indisputably as warehouse workers. The assembly work they perform is incidental to their job of preparing goods for dispatch. If Polyaire were to contract out all its manufacturing processes, the relevant employees would continue to be engaged as warehouse workers. This would be the case even if Polyaire decided to contract out the fitting and adjusting duties.

  1. Accordingly, I find the relevant employees are not employed or usually employed in the trade of assembler.

3.2 Are the relevant employees employed in the trade of Fitter or as a worker in Kindred Trades under rule 1A(a)?

  1. Very little was put to me in terms of whether the relevant employees were employed in the trade of fitter or in a kindred trade on the basis that the parties agreed the primary argument was in relation to “assembler”.

  1. It does not appear to me that the relevant employees are engaged in traditional “fitter” duties. In any event, even if the fitting and adjusting duties were considered fitter work, for reasons given above, the relevant employees are not engaged substantially in these activities.

  1. While I acknowledge that “all workers engaged in …kindred trades” are words of expansion[80] and the fitting and adjusting duties may be considered activities of a kindred trade, for reasons given above, the relevant employees are not engaged substantially in these activities.

3.3 Are the relevant employees employed “in connection with” a trade in rule 1A(a)?

3.3.1 AMWU Submissions

  1. The AMWU argues that the relevant employees carry out activities in connection with manufacturing workers in Adelaide. The AMWU argues that the relevant employees deal substantially with products manufactured in Adelaide and relies on Mr Guanizo’s evidence that he and his co-workers usually spends 2-4 hours per day dealing with products manufactured by Polyaire.

  1. The AMWU seeks to distinguish the ResMed decision in relation to the relevant employees on the basis that the ResMed warehouse employees “did not assemble any products nor did they deliver any parts to the assemblers”[81].

3.3.2 Polyaire Submissions

  1. Polyaire contends there is an insufficient connection between employees engaged at Clayton warehouse and any Polyaire manufacturing employees. The Clayton warehouse only receives goods from Adelaide, with no connection to manufacturing operations in Queensland or NSW and products manufactured in Adelaide represents approximately 4% of items stocked by Polyaire.[82]

  1. In any event, Polyaire argues the test is not whether the employees are “engaged substantially” in dealing with product from Adelaide, but whether work performed by employees is “referable or significant” to the work of Polyaire manufacturing employees. Polyaire relied on ResMed to argue the work of the warehouse employees is not “substantially connected” to the Adelaide manufacturing employees.

3.3.3 Consideration.

  1. I do not consider that there are grounds for me to distinguish the current case from the Full Bench decision in ResMed. As stated above at [26], the Full Bench in ResMed did not consider that the work done by employees in the warehouse group was referable or significant to other work groups. There appears to be even less connection with the relevant employees in the current case than the warehouse workers in ResMed: the Clayton warehouse is not on the same site as the manufacturing, the warehouse does not stock raw materials for manufacturing and the majority of product in the warehouse is manufactured by external suppliers.

  1. With regards to the AMWU’s argument that ResMed should be distinguished because relevant employees perform assembling duties – these duties do not assist or have any connection to the work performed by manufacturing employees in Adelaide. The AMWU also appears to argue that the fact the relevant employees both deliver and assemble the Connect Fittings and Quick Fix Bar Grilles means the relevant employees are assisting assemblers. However, as I have previously found that the relevant employees are not employed in the trade of assembler, this cannot be relied on to argue that connection.

  1. Accordingly, I find that the relevant employees are not employed in connection with a trade or calling under Rule 1A(a).

3.4 Are the relevant employees employed in or in connection with a trade under rule 1A(c)(i)?

  1. The AMWU contends the relevant employees are employed in or in connection with producing or assisting to produce or the making of goods in or in connection with sheet metal working and sheet metal box making.”[83]

  1. Polyaire rejects this contention. Polyaire argues that the only metal boxes the AMWU could be referring to are the Quick Fix Bar Grilles and Swirl Cushion boxes (as the Connect Fittings are made of plastic). The relevant employees have only done approximately two hours work over six months on the Quick Fix Bar Grilles, and the relevant employees have not been required to adjust the Swirl Cushon Boxes for the last two years.[84]

  1. For the same reasons given in relation to rule 1A(a), I do not consider the relevant employees are employed in or in connection with producing, or assisting to produce, make or repair any goods in or in connection with sheet metal working or sheet metal box making.

3.5 Are the relevant employees employed in or in connection with a trade under rule 1A(c)(iv)?

  1. Rule 1A(c)(iv) is framed differently to other subrules under 1A in that it reads as follows:

“The Union will consist of an unlimited number of persons who are employed in or usually employed in or in connection with the following trade or calling or branches thereof:

(c)(iv) All employees in any establishments connected with the manufacture, assembling…grates, registers, copper casings or other heating apparatus, domestic appliances made of metal…”

(Emphasis added)

  1. The AMWU contends that the relevant employees are “employed in an establishment, namely the Clayton Facility, connected with the manufacture and assembling of heating apparatus and domestic appliances made of metal (HVAC equipment).”[85]

  1. I asked the parties how rule 1A(c)(iv) was to be construed given the reference to establishments. The parties agreed that the relevant “establishment” of the relevant employees referred to the Clayton site (rather than Polyaire’s operations as a whole).[86] Each party then provided further submissions as follows.

  1. The AMWU’s position is that for a worker to fall under rule 1A(c)(iv), they would both need to be employed at an establishment connected to manufacturing, and to perform manufacturing-related duties at that establishment. It conceded that for example, a sales or administrative staff worker employed at a factory would not be eligible for membership under rule 1A(c)(iv).[87] Ultimately, the AMWU’s contention in relation to rule 1A(c)(iv) appears reliant on a similar finding in respect of 1A(a) or 1A(c)(i). 

  1. Polyaire argued the inclusion of “establishment” added nothing and was likely a drafting error.[88] In any event Polyaire argued the warehouse did not have a sufficient connection with the Adelaide factory.

  1. Given the parties’ submissions, and for the same reasons given in relation to rule 1A(a), I do not consider the relevant employees are employed in or in connection with any establishment or any of the trades or calling listed in rule 1A(c)(iv).

3.6 Are relevant employees employed in or in connection with occupations in rule 1H?

  1. Rule 1H is worded slightly differently to rule 1A and refers to “occupations” rather than trades. The occupations listed in rule 1H(a)(i) also relevantly include “plastics manufacturing or any of the processes of or incidental to the manufacturing of plastics….” As neither plastics nor “processes incidental to…” are referenced under rule 1A, I sought further submissions on the parties regarding this rule.    

  1. The AMWU contended that the relevant employees are engaged in or in connection with the manufacturing of plastic goods, or alternatively processes incidental to the manufacturing of plastics. It submits that the PM4 grilles manufactured in Adelaide, as well as the Connect Fittings sourced from an overseas supplier, both contain plastic, and that the fitting work performed by the relevant employees is “incidental work” to their manufacturing.[89]   

  1. Polyaire submits that the relevant employees are neither employed in plastics manufacturing nor involved in a process incidental to plastics manufacturing. Polyaire relies on a similar argument as in its construction of rule 1A – that whether an employee is “engaged in” an occupation, should be determined by reference to the “primary function” or the “essence of the role.”[90] On Polyaire’s analysis, a finding that the relevant employees perform some duties incidental to plastics manufacturing would not disrupt its primary submission that the relevant employees are engaged as warehouse workers.

  1. On the evidence before me the PM4 grilles, which are the only Polyaire manufactured product dealt with by the relevant employees, do not include any plastic.[91] Even if I were to consider the Connect Fittings manufactured by an external supplier, for the same reasons as given above in relation to rule 1A(a) I do not find the relevant employees are engaged in or in connection with plastics manufacturing or any of the processes of or incidental to manufacturing of plastics.

Conclusion

  1. Polyaire publicly promotes itself as an “international manufacturer”[92] and the relevant employees were originally engaged under the Manufacturing Award. It is understandable then, that the relevant employees and the AMWU formed the view that the AMWU was entitled to be a bargaining representative for the employees.

  1. However, union rules are to be construed objectively.[93] Having considered all the material before me regarding the work performed by the relevant employees, I have come to the view that the relevant employees are not eligible under the AMWU occupational rules identified in this case. Accordingly, I reluctantly find that the AMWU is not entitled to be a bargaining representative for the relevant employees. I say reluctantly because it appears to me that the primary reason for Polyaire’s jurisdictional objection to this application is to hinder or delay collective bargaining for an enterprise agreement.

  1. There are a number of options open to the relevant employees to progress bargaining for an agreement, which the AMWU will no doubt discuss with the relevant employees. One option is for the relevant employees to appoint one of them, or all of them, as bargaining representatives in accordance with s.176(1)(c) of the FW Act and to approach Polyaire to commence bargaining as soon as possible. I encourage Polyaire not to resist bargaining but to work with its employees to negotiate an agreement.

  1. I dismiss the application.


COMMISSIONER

Appearances:

S Fodrocy for the Applicant
A Manos for the Respondent

Hearing details:

2024
17 October, 29 October
Melbourne


[1] I have accepted Mr Roberto Guanizo’s evidence as the AMWU delegate that the five full-time warehouse employees engaged by the Respondent want to negotiate an agreement– see Transcript at PN1622. I have done so in the context that the Respondent in the case management conference confirmed that there were no other objections to the majority support application including whether a majority of the employees to be covered by the proposed Agreement wanted to bargain.

[2] Exhibit AMWU-3 – Witness statement of Lewis Farrugia, attachment 2, Digital Hearing Book (‘DHB’) 75.

[3] Exhibit PR-1 – Witness statement of Adam Cottam, at [4], DHB 34, (‘Cotham 1’).

[4] Exhibit PR-2 – Second Witness Statement of Adam Cottam with amendments outlined at Transcript PN154 - PN181, [17], DHB 104 (‘Cotham 2’).

[5] As required in s.236(1)

[6] Pursuant to s.12 of the FW Act.

[7] Transcript PN1913 and PN2090.

[8] “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) v ResMed Limited[2014] FWCFB 3501 (‘ResMed’).

[9] ResMed, [34].

[10] ResMed, [34] (1)-(7).

[11] (1988) 29 IR 263 (‘Federated Tobacco Workers’).

[12] ResMed, [39], quoting Federated Tobacco Workers, 275.

[13] ResMed, [70].

[14] Ibid [74].

[15] Ibid [75]

[16] Ibid [76]

[17] Federated Tobacco Workers, 275.

[18] ResMed, [81].

[19] Exhibit PR-3 – Witness Statement of Daniel Mills with amendments outlined at Transcript PN862 – PN873 (‘Mills’), [8], DHB 117; Transcript PN1755, PN1767.

[20] Transcript PN1755, PN1790.

[21] Transcript PN372.

[22] Transcript PN1537-1538.

[23] Cotham 2, [18], DHB 104.

[24] Exhibit AMWU-4 – Witness Statement of Robert Guanizo with amendments outlined at Transcript PN1394 – 1430 (‘Guanizo’), [8], DHB 66.

[25] Transcript PN1400, PN1532.

[26] Mills, [43], DHB 120.

[27] Mills, [44] – [45], DHB 120.

[28] Transcript PN1547-1548, PN1570.

[29] Transcript PN953.

[30] Transcript PN653-655.

[31] Cottam 2, [2], DHB 102.

[32] Cottam 2, [7], DHB 102.

[33] Transcript PN929-931.

[34] Transcript PN1789.

[35] Transcript PN937, PN1787-1788.

[36] Transcript PN1788.

[37] Transcript PN1097, PN1138.

[38] Transcript PN976.

[39] Transcript PN977, PN1555.

[40] Transcript PN981.

[41] Transcript PN1710.

[42] Transcript PN961.

[43] Mills, [29], DHB 119.

[44] Mills, [30], DHB 119.

[45] Mills, [35], DHB 119.

[46] Transcript PN1734-1736.

[47] Guanizo, [9], DHB 66.

[48] Mills, [23], DHB 118 and [40], DHB 120.

[49] Guanizo, [9], DHB 66.

[50] Cottom 2, [7], DHB 102.

[51] Transcript PN1190.

[52] Cottom 1, Attachments 3 and 4, DHB 41- 43.

[53] Guanizo, Attachment 1, DHB 68.

[54] Guanizo, Attachment 3, DHB 71.

[55] Transcript PN460.

[56] Transcript PN473.

[57] Transcript PN467-469.

[58] Transcript PN472-474.

[59] Submissions of the AMWU, [44], DHB 57.

[60] Ibid [43].

[61] See for example PN2049 - 2050, PN2096- 2099.

[62] Transcript PN1190.

[63] Transcript PN1967.

[64] Transcript PN1968.

[65] Transcript PN1969.

[66] [1998] FCA 551 (‘Metropolitan Fire and Emergency Services Board’).

[67] [2015] FCAFC 1 (‘Country Fire Authority’).

[68] Submissions of the AMWU, [65-66], DHB 60-61.

[69] Transcript PN1939.

[70] Transcript PN1945.

[71] Submissions of Polyaire, [40], DHB 91.

[72] Transcript PN2024.

[73] Transcript PN1837.

[74] 1990 26 FCR 261.

[75] Ibid 272, 279.

[76] (1977) WAIG 585.

[77] ResMed, [75].

[78] ResMed, [76].

[79] ResMed, [74].

[80] Federal Tabacco Workers, 272.

[81] Submissions of the AMWU, [39], DHB 57.

[82] Cottam 2, [17], DHB 104.

[83] Submissions of the AMWU, [44], DHB 57.

[84] Transcript PN2030.

[85] Submissions of the AMWU, [44], DHB 57.

[86] Transcript PN2064, PN2084.

[87] Transcript PN2083, PN2201.

[88] Transcript PN2196.

[89] Transcript PN2111.

[90] Transcript PN2098, PN2105.

[91] Transcript PN372.

[92] Farrugia, attachment 2, DHB 75.

[93] ResMed at [34].

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Australian Manufacturing Workers' Union v ResMed Limited [2014] FWCFB 3501