Construction, Forestry, Mining and Energy Union-Mining and Energy Division; Construction, Forestry, Mining and Energy Union-Mining and Energy Division Queensland District Branch
[2016] FWCFB 197
•12 JANUARY 2016
| [2016] FWCFB 197 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.604 - Appeal of decisions
(C2015/7271)
VICE PRESIDENT WATSON | BRISBANE, 12 JANUARY 2016 |
Appeal against decision [2015] FWCD 7109 of the delegate of the General Manager at Melbourne on 30 October 2015 in matter number R2014/186 – Whether exemption granted to conduct elections internally should be revoked – Whether delegate was satisfied that compliant elections will be conducted in the future – Proper application of statutory tests – Procedural fairness – Fair Work (Registered Organisations) Act 2009 – s.186
Introduction
[1] This decision concerns an application by the Construction, Forestry, Mining and Energy Union-Mining and Energy Division; Construction, Forestry, Mining and Energy Union-Mining and Energy Division Queensland District Branch for permission to appeal and an appeal against a decision of Chris Enright, delegate of the General Manager, handed down on 30 October 2015.
[2] The decision of Mr Enright concerns a revocation under s.186(2)(b) of the Fair Work (Registered Organisations) Act 2009 (Registered Organisations Act) of the exemption granted to the Queensland District Branch of the Mining and Energy Division of the CFMEU which enabled the Branch to conduct its own elections for office internally without the participation of the Australian Electoral Commission (AEC).
[3] In the hearing of the appeal in this matter, Mr S. Crawshaw SC appeared with Mr A. Bukarica on behalf of the CFMEU.
Background
[4] On 2 May 1996, the Branch was granted an exemption under ss. 198 and 213 of the Industrial Relations Act 1988 that elections are to be conducted by secret postal ballot and that the AEC conduct its elections. The exemption has continued under subsequent replacement legislation.
[5] The decision of the General Manger’s delegate reveals the history leading to his decision. In May 2013, an anonymous complaint was received by the General Manager of the Fair Work Commission about the conduct of elections by the Division and the Branch in 2011 and 2012. At the request of the General Manager, the Regulatory Compliance Branch of the Commission conducted a range of inquiries in relation to the complaint. During the conduct of these inquiries, additional matters of interest emerged in relation to the elections. Mr Enright subsequently commenced revocation proceedings. His stated reasons related to the past conduct of elections in the Branch which gave rise to concerns about whether future elections would be conducted in accordance with the Registered Organisations Act.
[6] In relation to the issues arising in relation to the AEC exemption, Mr Enright formed the view that he could no longer be satisfied that elections for the Branch would be conducted under the rules of the Branch. On 20 August 2015, Mr Enright therefore issued a Notice to Show Cause to the Committee of Management of the Branch with a Statement of Reasons. The reasons were summarised in his decision as follows:
“i. Postal voting has occurred in Branch elections for many years contrary to Rule 17.
ii. The Branch has not always appointed Returning Officers in accordance with Rule17(a).
iii. The relevant Returning Officer for the Branch has not appointed a Local Returning Officer at each lodge or locality to conduct attendance ballots for every election under Rule 17(a).
iv. The Branch President issued a direction to the Returning Officer in a by-election for the Branch Executive Vice President in 2011 (the 2011 election) regarding when the ballot should close at a particular lodge and subsequently determined that irregularities had occurred in the election (where both such actions by the Branch President appeared to have been done without relevant authority under the rules or the RO Act).
v. The Branch’s Board passed a resolution to deem the 2011 election invalid without relevant authority under the rules or the RO Act.
vi. The effect of the Board’s resolution in the 2011 election was to declare, in effect, that a person who had been purportedly elected in that election had not been elected.”
[7] The Show Cause Notice invited the Branch’s Committee of Management to show cause as to why the exemption granted to it to conduct its own elections should not be revoked. Written submissions and other material were filed with the Commission and the matter was listed for hearing before Mr Enright on 17 September 2015.
The Decision under Appeal
[8] Mr Enright’s conclusions are expressed as follows:
“[268] It is apparent that the Division and the Branch have taken, are taking and are proposing to take, action to prevent any repetition of irregularities. That action includes: submitting rule changes to the Division which would facilitate postal ballots; submitting rule changes which centralise the Returning Officer function with a single National Returning Officer appointed by Central Council while removing the option of District Branches appointing their own Returning Officer; ensuring better training of all returning officers and providing access to independent legal advice to the National Returning Officer; and ensuring more explicit onus on the National Returning Officer to be satisfied that Local Returning Officers are sufficiently trained or experienced to undertake their functions.
[269] On the other hand, I have also taken into account that notwithstanding the purportedly extensive experience, knowledge and training delivered in the Division focused on election processes, it is likely that on-going contraventions of the rules including with respect to postal voting and the appointment of Local Returning Officers have been occurring since exemptions were granted to the Division and the Branch in 1996. I have also taken into account the potential failure of the Division and the Branch to comply with the RO Act requirements concerning declaration envelopes since the 2003 amendments referred to in this decision.
[270] While these are relevant matters it was the egregious conduct of the Queensland Board of Management in the 2011 election which has caused me the greatest concern. I agree with the manner in which Mr Vickers characterised the election as a ‘debacle’ although in my view, the conduct of the Board is more likely to have been intentional rather than due to inexperience.
[271] In particular, I am concerned about the beyond power actions of the Queensland District President Mr Smyth and the Queensland Board of Management in resolving to determine election irregularities, voiding an election outcome, declaring (in effect) that an elected candidate had not been elected and then failing to comply with a rule with respect to providing that resolution to rank and file members of the Branch for endorsement. That Mr Smyth had a preferred candidate and a concomitant interest in the outcome of the election exacerbated my concerns.
[272] The available materials in general and the relevant rules in particular demonstrate that District Branches have autonomy over matters that affect members of the District Branch only. In all the circumstances, I continue to have serious concerns both about whether senior officers in the Queensland Branch might seek, without appropriate power or authority, to impinge upon future Branch elections and the capacity of the Division to prevent, or adequately deal with such interference if or when it was to occur.
[273] On balance, I am not persuaded that the measures taken, being taken or to be taken either singularly or in aggregate, satisfy me that if the Queensland Branch is exempted from having its elections conducted by the AEC under s 186(1), that elections for the Branch will be conducted under the rules of the Division or Branch and the RO Act.
[274] In the submission of Mr Crawshaw SC dated 11 September 2015, it was put that even if the General Manager is, to use his words ‘no longer completely satisfied that elections for the Queensland Branch will be conducted under the rules and the … RO Act, the word “may” in s 186(2) of the … RO Act clearly provides that a discretion arises as to whether the General Manager should revoke the exemption’.
[275] I accept that the power to revoke the exemption is discretionary and I have taken each of the relevant matters into account in considering whether to exercise the discretion.
[276] I have again considered each of the relevant circumstances in this case including the nature and extent of the irregularities and contraventions referred to in this decision such as the contraventions of the Rules and of the RO Act which have been conceded.
[277] I have also carefully considered the submissions concerning consequences to the Branch if the exemption were to be revoked and I have evaluated those submissions.
[278] In considering whether to exercise the discretion, I have again considered each of the actions taken, being taken and to be taken by the Division and the Branch, including submitting rule changes which would facilitate postal ballots, submitting rule changes which centralise the Returning Officer function with a single National Returning Officer, ensuring better training of all Returning Officers and providing access to independent legal advice to the National Returning Officer.
[279] Further, I considered the oral submissions made during the hearing of 17 September 2015, including that the Division and the Branch have taken on board what has occurred in this case and used those circumstances as a wake-up call while trying to improve the situation in the future.
[280] I have also considered the willingness expressed by Mr Crawshaw SC on behalf of the Division to include the requirements of s 188 of the RO Act and the relevant regulations, including regulations 5 and 6 after I had brought those requirements to his attention.
[281] After carefully considering these additional and relevant matters, I continue to have serious concerns both about whether senior officers in the Queensland Branch might seek, without appropriate power or authority, to impinge upon future Branch elections and the capacity of the Division to prevent, or adequately deal with such interference if or when it was to occur.
[282] As I have indicated above, I agree with the manner in which Mr Vickers characterised the 2011 election as a ‘debacle.’ In my view, the conduct of the Board in that election is more likely to have been intentional rather than due to inexperience and on balance, I am not satisfied that if the Queensland Branch is exempted from having its elections conducted by the AEC under s 186(1) of the RO Act, that elections for the Branch will be conducted under the rules of the Division or Queensland Branch and the RO Act. Accordingly, I am satisfied that I should exercise my discretion and revoke the AEC exemption issued in R20021/1996.
Conclusion
[283] I am not satisfied that if the Queensland District Branch is exempted from having its elections conducted by the AEC under s 186(1) of the RO Act, that elections for the Branch will be conducted under the rules of the Division or Branch and the RO Act. Accordingly, I revoke the AEC exemption issued in R20021/1996 as of the date of this decision.”
(references omitted)
Grounds of Appeal
[9] The CFMEU submits that Mr Enright acted upon wrong principles in his application of the statutory test relating to prerequisites for revocation of the exemption. In particular, it contends that the decision is in error and does not correctly apply the statutory requirements for revocation by:
- Finding that there was no review of elections by an external body and that the only review mechanism was the power to revoke the exemption;
- Not explaining how the Statement of Reasons, which dealt with past conduct of elections, led to the conclusion that Mr Enright could no longer be satisfied that future elections for the Branch will be conducted in accordance with the Registered Organisations Act and the CFMEU’s rules; and
- Requiring the CFMEU to demonstrate that it could ensure that elections are conducted in accordance with the Registered Organisations Act and the CFMEU’s rules, that irregularities do not occur in future elections, and that issues do not arise in relation to future elections.
[10] The CFMEU also submits that Mr Enright erred in making findings not open to him based on the material before him, that he failed to accord the CFMEU and its officers procedural fairness, and that he failed to take into sufficient account a number of discretionary matters in relation to the revocation of its AEC exemption.
[11] The CFMEU accepts that the decision under appeal is properly described as a discretionary and therefore it is required to demonstrate appealable error of the type set out in House v The King. 1 In that case the High Court described the approach as follows:
“The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred.”
Permission to Appeal
[12] The CFMEU submits that permission to appeal should be granted for the following reasons:
- The appeal raises novel questions regarding how a delegate of the General Manager should approach the issue of whether to revoke an exemption from a ballot conducted by the AEC;
- The appeal raises the issue as to the tests to be applied in relation to a Notice to Show Cause as to why an AEC ballot exemption should not be revoked;
- The decision is attended with sufficient doubt to warrant its reconsideration;
- There is significant public interest in ensuring that a decision to revoke an AEC ballot exemption is free from error; and
- Substantial injustice would result if permission to appeal was refused.
[13] We are satisfied that the subject matter of the appeal and the novelty of the issues justifies permission to appeal being granted. We turn to consider the particular grounds of appeal.
External Review
[14] This ground of appeal relates to a statement at paragraph [12] of the decision in which it is stated:
“[12] Elections conducted by organisations or branches with AEC exemptions are not subject to review by any external body. Essentially, the only review mechanism for AEC exemptions is the power to revoke in s 186(2) of the RO Act to which I now turn.”
[15] The CFMEU contends that this statement suggests that the delegate was acting under the mistaken belief that the only review mechanism available for an election when an AEC exemption has been granted is revocation of the exemption. It contends that election enquiries can be instituted in the Federal Court.
[16] The statement of the delegate is in the introductory outline of the background to the matter. It is a general statement that might refer to the usual situation rather than the availability of legal remedies. It is not appropriate to review the language of a decision with an overly critical perspective. There is no basis to suggest that this statement caused the delegate to ask an incorrect question. We dismiss this ground of appeal.
Past and Future Elections
[17] The CFMEU contends that the delegate erred in the way he considered the absence of satisfaction that future elections would be conducted under the rules and the Registered Organisations Act and did not explain how the consideration of events in the past, principally the 2011 by-election, could lead to his opinion about the future.
[18] The delegate’s decision arose, as we have noted, from a Show Cause Notice issued to the CFMEU. After dealing with the matters that gave rise to his concerns, his decision deals with the various submissions raised by the CFMEU in response to that Show Cause Notice. The decision contains sections dealing with each of those submissions. He termed them the Remedial action submission – Draft Rules, the Remedial action submission – National Returning Officer, the Remedial action submission – Training, the Inexperience in 2011 submission, the Complete history submission – conduct of past elections, the Complete history submission – knowledge and experience regarding elections, the Complete history submission – absence of legal challenges, and Additional submissions by Counsel – discretionary and other matters.
[19] The CFMEU contends that the findings were in error because they were expressed as findings that each submission was insufficient to overcome the absence of satisfaction in relation to future elections and contained various other errors. It submits in particular that the language used by the delegate erects a bar higher than provided for in the Act by use of words such as:
“[168] Accordingly I am not persuaded that the conduct of elections by one National Returning Officer will necessarily ensure that issues do not arise in future elections for the Branch or that future elections for the Branch will be conducted in accordance with the rules and the RO Act.”
[20] The CFMEU contends that the test is whether the delegate “is no longer satisfied” that elections “will be conducted …under the rules of the organisation…and this Act”. It contends that the requirement that changes “will necessarily ensure that issues do not arise in the future” is a more stringent requirement.
[21] We have reviewed the decision and the detailed Statement of Reasons. The delegate identified his reasons for coming to the preliminary view that he could no longer be satisfied as to the matters in s.186(1)(b)(i). He applied the wording of the sections in coming to that view. He then considered all of the arguments advanced by the CFMEU. His conclusions that we have set out above are properly focussed on the test in the Registered Organisations Act. In the course of considering the impact of certain changes he used different language such as whether the change would ensure future compliance. In our view this is entirely appropriate. If the particular changes would ensure future compliance then it would follow that the delegate would be satisfied that compliant elections will be conducted. On the other hand, if the changes do not ensure compliance, then in the context of all of the circumstances, it is unlikely that he could be satisfied that compliant elections will be conducted. As we have observed that was the conclusion he reached in the terms of the Act when he said in his overall conclusions:
“[273] On balance, I am not persuaded that the measures taken, being taken or to be taken either singularly or in aggregate, satisfy me that if the Queensland Branch is exempted from having its elections conducted by the AEC under s 186(1), that elections for the Branch will be conducted under the rules of the Division or Branch and the RO Act.”
[22] In our view, this ground of appeal essentially invites us to adopt an overly critical review of the Statement of Reasons. We are not persuaded that in the context of a discretionary decision and the proper meaning of the test in the Registered Organisations Act, this ground of appeal establishes any appealable error. We dismiss this ground of appeal.
Findings Regarding Conduct of Branch Officers
[23] The CFMEU submits that the CFMEU and its branch officials were denied procedural fairness by not being put on notice that breaches of the rules in 2011 were intentional and egregious. The CFMEU submits that the matter was raised at the hearing as a product of inexperience rather than something more serious as ultimately found. It contends that in making the finding a range of matters were not taken into account and the delegate erred in taking it into account as there is no logical connection between it and the conduct of future elections.
[24] We are not persuaded that this ground of appeal has substance. In our view, the matters of concern were raised with the CFMEU and it had ample opportunity to address them. The detailed evidence was assessed and findings were made. The CFMEU has not established that this ground discloses appealable error.
Postal Ballots and Local Returning Officers
[25] The CFMEU contends that it was erroneous for the delegate to concentrate on postal ballots and appointment of local returning officers being inconsistent with the Division’s rules because it was a Division wide problem rather than one peculiar to the Branch and rule changes are being made to address this issue.
[26] We are not persuaded that the delegate’s treatment of this issue involves appealable error. The evidence was considered, findings of fact were made and these were considered as part of the ultimate conclusion.
Discretionary Matters
[27] The CFMEU submits that a narrow approach to discretion was adopted and various factors were not taken into account in deciding to cancel the exemption. In our view, these grounds do not reflect a fair and proper reading of the decision. We consider that they are overly critical of the language used in the Statement of Reasons. It is clear to us that the delegate applied the correct test and made a decision based on the evidence. It has not been shown that any extraneous factors affected the result or that relevant matters were not taken into account.
Procedural Fairness
[28] The CFMEU submits that certain issues concerning the rules of the CFMEU were not raised prior to the decision and that, to the extent they were problematical, they were Division wide problems. Further it contends that the decision was influenced by persons in impermissible ways – including interviews with CFMEU members in which the CFMEU was not involved, consideration of newspaper reports and the participation of other members of the General Manager’s staff in the hearing process.
[29] The functions under the relevant Democratic Control provisions of the Registered Organisations Act and the regulations are administrative functions vested in the General Manager. The General Manager has broad powers of investigation into various matters under the Registered Organisations Act. The processes of investigation are to be determined by the General Manager or delegate in the particular circumstances of the case, subject to compliance with the obligation to afford procedural fairness. In this case the detailed statement of reasons in the Show Cause process, which followed an investigation, flagged the key issues that required consideration. The CFMEU had an opportunity to submit material in writing and at a hearing. Having regard to the nature of the process involved, the procedure adopted by the delegate and the opportunities provided to the CFMEU for input we are not persuaded that the procedure involves appealable error. We dismiss this ground of appeal.
Conclusions
[30] Because of the novelty and subject matter of the appeal we grant permission to appeal. As we have concluded that each ground of appeal lacks merit we dismiss the appeal.
VICE PRESIDENT
Appearances:
Mr S. Crawshaw SC, with Mr A. Bukarica, on behalf of the CFMEU.
Hearing details:
2015.
Melbourne.
7 December.
Final written submissions:
CFMEU on 2 December 2015.
1 (1936) 55 CLR 499.
Printed by authority of the Commonwealth Government Printer
<Price code C, PR576012>
0
2
0