Construction, Forestry, Mining and Energy Union v CSBP Ltd

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FEDERAL COURT OF AUSTRALIA

Construction, Forestry, Mining and Energy Union v CSBP Limited [2012] FCAFC 48

Citation: Construction, Forestry, Mining and Energy Union v CSBP Limited [2012] FCAFC 48
Appeal from: CSBP Limited v Construction, Forestry, Mining and Energy Union [2011] FCA 917
Parties: CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION v CSBP LIMITED ACN 008 668 371
File number: WAD 357 of 2011
Judges: KEANE CJ, SIOPIS & RARES JJ
Date of judgment: 2 April 2012
Catchwords: Fair Work (Registered Organisations) Act 2009 (Cth), s 166 – declaratory relief – registered rules – interpretation of registered union rules – eligibility for membership – approach to determining the eligibility for membership of registered organisation – consideration of the ‘primary purpose test’ – consideration of activities of employees in the course of their employment – relationship between eligibility for membership and description of industry rules – whether Process Technicians are ‘attendants’ or ‘any other workers assisting in and about the work incidental to any engine, boiler or machinery connected with the production or utilisation of power on land’
Legislation: Fair Work (Registered Organisations) Act 2009 (Cth)
Cases cited:

R v Isaac; Ex parte Transport Workers Union of Australia (1985) 159 CLR 323 followed

R v McKenzie; Ex Parte Actors and Announcers Equity (1982) 148 CLR 573 cited
Federated Engine Drivers’ & Firemen’s Association of Australasia v Master Builders Association of Western Australia (1983) 291 CAR 530 cited

Coldham; Ex parte the Australian Workers’ Union (1984) 56 ALR 149 discussed
Federated Engine Drivers & Firemen’s Union (WA) v Mt Newman Mining Co Pty Ltd (1977) 57 WAIG 794 followed
Joyce v Christoffersen (1990) 26 FCR 261 followed
R v Cohen; Ex parte Motor Accidents Insurance Board (1979) 141 CLR 577 considered
Electrical Trades Union of Australia v Waterside Workers Federation of Australia [No 2] (1982) 59 FLR 78 (at 87); 42 ALR 587, 595 considered
Re IBM Global Services Australia Ltd (2005) 144 IR 389 considered
R v Gough; ex parte The Municipal Officers’ Association Australia (1975) 133 CLR 59 followed

Date of hearing: 8 March 2012
Place: Perth
Division: GENERAL DIVISION
Category: Catchwords
Number of paragraphs: 56
Solicitor for the Appellant: Slater & Gordon
Counsel for the Appellant: Mr S Crawshaw SC
Mr A M Slevin
Solicitor for the Respondent: Ashurst Australia
Counsel for the Respondent: Mr J Blackburn

IN THE FEDERAL COURT OF AUSTRALIA

WESTERN AUSTRALIA DISTRICT REGISTRY

GENERAL DIVISION

WAD 357 of 2011
ON APPEAL FROM THE FEDERAL COURT OF AUSTRALIA
BETWEEN:

CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION
Appellant
AND:

CSBP LIMITED ACN 008 668 371
Respondent

JUDGES:

KEANE CJ, SIOPIS & RARES JJ

DATE OF ORDER:

2 APRIL 2012

WHERE MADE:

PERTH

THE COURT ORDERS THAT:

1.The appeal be dismissed; and 

2.The appellant pay the respondent’s costs to be taxed if not earlier agreed.

Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


IN THE FEDERAL COURT OF AUSTRALIA

WESTERN AUSTRALIA DISTRICT REGISTRY

GENERAL DIVISION

WAD 357 of 2011
ON APPEAL FROM…
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Details
Case
[2012] FCAFC 48
Decision Date

CaseChat Overview and Summary

The Federal Court of Australia heard an appeal in the matter of Construction, Forestry, Mining and Energy Union v CSBP Ltd, concerning the interpretation of the eligibility rules for membership of a registered organisation under the Fair Work (Registered Organisations) Act 2009 (Cth). The dispute centred on whether Process Technicians employed by CSBP Ltd at its Kwinana Plant were eligible for membership of the Construction, Forestry, Mining and Energy Union (CFMEU). The primary judge had ruled in favour of CSBP Ltd, finding that the Process Technicians were not eligible for membership because they were not primarily involved in work incidental to engines, boilers, or machinery connected with the production or utilisation of power on land.

The court needed to decide whether the Process Technicians could be considered as "attendants, greasers, cleaners, trimmers and any other workers assisting in and about the work incidental to any engine, boiler or machinery connected with the production or utilisation of power on land," as per the registered union rules. The appeal hinged on the interpretation of these rules, particularly the phrase "the work incidental to" and the classification of the Process Technicians' roles.

The court held that the CFMEU's attempt to interpret the eligibility rules in isolation was flawed, and the rules should be read as a whole. The court emphasised that the eligibility rules were concerned with employees whose principal purpose of employment was in and about work of a subordinate or subsidiary nature in relation to engines, boilers, and machinery. The court found that Process Technicians, despite performing some work related to turbines, boilers, and generators, were primarily responsible for the successful operation of CSBP's chemical plant and thus were chemical workers, not eligible for membership under the rules. The court concluded that the primary judge's decision should be upheld, and the appeal dismissed.

The court ordered that the appeal be dismissed and that the appellant pay the respondent’s costs to be taxed if not earlier agreed. This decision clarified the interpretation of eligibility rules for membership of a registered organisation under the Fair Work (Registered Organisations) Act 2009 (Cth).

Orders

Orders of the court

1. The appeal be dismissed; and

2. The appellant pay the respondent’s costs to be taxed if not earlier agreed.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background

Background to the litigation

Before we turn to discuss the arguments agitated on appeal, it is necessary to set out the factual background, a summary of the issues at trial and the reasons of the primary judge. His Honour’s findings of primary fact are not disputed.BACKGROUND CSBP manufactures and produces chemical products at a chemical plant in Kwinana, Western Australia (the Kwinana Plant). The products include ammonia, ammonium nitrate (or AN) (which can also be mixed with urea to make a liquid fertiliser branded as ‘flexi-N’), CO2 (a by-product of ammonia production), sodium cyanide (for sale within a joint venture company to goldmining companies in Australia for use in extracting gold from gold bearing ore), fertilisers and fluorosilicic acid (a by-product of the superphosphate manufacturing plant operated by CSBP). CSBP’s operations are performed within a number of ‘business units’ which are physically and operationally discrete. The business units to which this proceeding relates are the Sodium Cyanide Business Unit (SCBU) and the Ammonia/Ammonium Nitrate Business Unit (Ammonia BU). In each Unit, CSBP employs people as ‘Process Technicians’. The principal role of the Process Technicians is to monitor and operate the entire production process including pressures, temperatures, chemical reactions, flows and throughputs, so as to ensure the safe operation of the plant and the efficient production of chemicals. There are approximately 66 Process Technicians in the Ammonia BU and 26 Process Technicians in the SCBU. Process Technicians are separated into two categories: Lead Operators and Field Operators. Lead Operators control the operation of the Kwinana Plant from the control rooms, monitoring temperatures, flows and pressures through the graphic user interfaces and making adjustments as required. Field Operators work mostly in the field inspecting plants, monitoring temperatures, flows and pressures, taking samples and performing any field adjustments or isolation work that is required. Almost all Lead Operators are qualified to work as Field Operators from time to time and the majority of Field Operators are trained in the functions of a Lead Operator. The Training Modules applicable to each level require extensive competencies in the various aspects of employment. The training regime for Process Technicians, both Lead and Field Operators, is sophisticated and complex. There are “A”, “B” and “C” Process Technicians. These terms are used to indicate levels of training and competency. “A” Process Technicians are entry level Process Technicians that typically commence training on the “A” module. They are required to perform that module before moving onto the “B” and “C” modules. Examples of tasks taught at the “A” level are how valves work, when to open and close them, the operation and function of actuated (automated) valves, environmental training, products and customers, general workplace procedures, location of major buildings and equipment related to the relevant plant, location of safety equipment and housekeeping.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

For these reasons we conclude that the challenge to the decision of the primary judge must fail.CONCLUSION AND ORDERS The appeal should be dismissed. The appellant must pay the respondent’s costs to be taxed if not earlier agreed.

Ratio Decidendi

Legal Principle Established

In relation to the third issue, CSBP argues that the Eligibility Rule is concerned with employees whose principal purpose of employment is in and about work of a subordinate or subsidiary nature in relation to engines, boilers and machinery. While Process Technicians may perform some work in relation to turbines, boilers and generators, that is not the principal purpose of their employment because they are responsible for the successful operation of CSBP’s Kwinana Plant or of its constituent units. In terms of the principal purpose of their employment, they are chemical workers working in a chemical factory. CONSIDERATION It is convenient to commence with two general observations about the approach to the question of construction which arises in this case. The first point is that the CFMEU’s attempt to analyse three parts of the Eligibility Rule in isolation from each other ignores the assistance legitimately and necessarily to be gained from reading the Eligibility Rule as a whole. One should seek to understand the rule by considering it as a whole so that its parts may shed light on each other. This is so apart from the question raised by the CFMEU as to the legitimacy of reference to the Industry Rule as an aid to the construction of the Eligibility Rule, a question to which I will return. The first point to be made is that the CFMEU’s attempt to present what is truly one question of interpretation as if it were three distinct exercises in construction to be performed separately is an invitation to error. The second general point to be made at the outset is that one must have regard to the statutory context in which the question of construction arises. Section 166(1) of the Fair Work (Registered Organisations) Act 2009 (Cth) (the Act) provides for the entitlement of a person to become a member of an organisation of employees. It is relevantly in the following terms:(166(1))… a person who is eligible to become a member of an organisation of employees under the eligibility rules of the organisation that relate to occupations in which, or the industry or enterprise in relation to which, members are to be employed is, … entitled, subject to payment of any amount properly payable in relation to membership:(a) to be admitted as a member of the organisation[.] This second point has a number of ramifications. First, as to the CFMEU’s contention that “the work” referred to in the Eligibility Rule is the work of the Kwinana Plant, it should be noted that the Eligibility Rule confers an entitlement to membership by reference to the occupations of employed persons, not by reference to the industry or enterprise of the employer. In relation to the phrase “incidental to”, it should be understood that in construing the words of the Eligibility Rule in their unique legal and industrial context little assistance can be expected from decisions upon the construction of different words in a different legal and industrial context. We are not here concerned with an Eligibility Rule which operates by reference to the employer’s industry or enterprise. Moreover, in the Eligibility Rule, the meaning of the phrase “incidental to” is informed by the context in which it appears. That context includes reference to “attendants, greasers, cleaners, trimmers and any other workers assisting in and about the work …”. The common characteristic of the occupations listed is that they perform a subsidiary role in relation to the operation of machinery. The phrase “the work incidental to any engine etc” is a reference to the kind of work performed by the occupations earlier listed. The work so described is generically subsidiary to the operation of “any engine, boiler or machinery connected with the production or utilisation of power …”. It is not the “work” of the totality of the employer’s enterprise. The primary view of the meaning of “the work” advanced by the CFMEU should be rejected. If it were adopted it would lead to the absurd conclusion that an industrial chemist is within the Eligibility Rule.