Flight Attendants' Association of Australia
[2015] FWCD 6955
•21 October 2015
[2015] FWCD 6955
DECISION
| Fair Work (Registered Organisations) Act 2009 | |
| s.159—Alteration of other rules of organisation | |
| Flight Attendants' Association of Australia | |
| (R2015/191) | |
| MR ENRIGHT | MELBOURNE, 21 OCTOBER 2015 |
| Alteration of other rules of organisation. |
[1] On 26 August 2015 the Flight Attendants' Association of Australia (the Association)
lodged with the Fair Work Commission a notice and declaration setting out particulars of
alterations to the rules of the Association.
[2] The particulars set out alterations to the rules of the Association, those being the
introduction of new Rule 56A – the Extension of Terms of Office Transitional Rules; and of
new Rule 57 – a Special Transitional Provisions Rule (with Schedules A ‘the Transition
Rules’ and B ‘the New Rules’).
[3] The current rules of the Association provide for a National and an International
Division. The proposed alterations provide for the transition from a divisional to a unified
structure over an extended period. Specifically, rule 56A provides for the extensions of terms
of office of the National Division Divisional Officers and National Division Councillors in
order to synchronise the next elections with the elections for the International Division for the
purpose of the restructure. Rule 57 establishes Transition Rules (rules that apply to the
Association and its members during the transitional period) and New Rules (rules that apply
to the Association and its members on and from the assumption of office of the persons
elected in the 2020 elections). Further to this, Rule 57 provides for, amongst other things,
the following:
| | the abolition of Divisions, Divisional Councils and Divisional Executives; |
| | extension of the terms of office of National Division Divisional Officers and National |
| Division Councillors; | |
| | elections to be conducted in 2016 and 2020; |
| | that on Transition Day, the Divisional Officers in the Association become National |
| Officers for the balance of the term of office for which they are elected in the 2016 | |
| elections; | |
| | powers and duties of a National Council, National Executive, National Officers and |
| National Councillors during the transitional period; and | |
| | other matters of a consequential or transitional nature. |
[2015] FWCD 6955
[4] On 27 August 2015, the Commission received an email from a Mr Lou Nesci, who
identified himself as a member of the Association. Mr Nesci stated that he had been advised
that the Association had lodged paperwork to make extensive changes to the FAAA rules that
had been broadly defined as a merger of the two existing divisions. He further stated:
I understand that the FWC must form an opinion as to whether the alterations have
been made in accordance with the rules and is not contrary to other laws. I believe
they have not been made in accordance with the existing rules and may be contrary to
other laws. I would like the opportunity to appear before the FWC or submit reasons
for my claims in writing so the FWC is aware of all aspects of the proposed rule
change and can form a proper opinion to determine whether the rules change should
be adopted or rejected.
[5] Mr Nesci requested advice on the steps he could take to present his case and access the
changes proposed by the Association.
[6] On 28 August 2015, the Commission corresponded with Mr Nesci. The Commission
confirmed that the Association had lodged a notification of rule alterations with the
Commission on 27 August 2015 under section 159 of the Fair Work (Registered
Organisations) Act 2009 (the RO Act). Mr Nesci was provided with a copy of the application.
The Commission provided advice that, notwithstanding the lack of a formal objection process
in relation to section 159 applications, the Delegate of the General Manager of the
Commission (the Delegate) was of the view that if a person whose rights would be affected
wished to make a submission, he or she should be afforded the opportunity to do so. The
Commission invited Mr Nesci to provide evidence of his membership of the Association as
well as material which, having regard to the terms in section 159 of the RO Act, set out the
grounds and particulars of the objection.
[7] A copy of Mr Nesci’s email was sent to the Association.
[8] On 7 September 2015, an objection was lodged by Mr Nesci. Mr Nesci provided
evidence of his membership of the Association, and stated in his objection that he did not
believe the alterations “had been made under the rules that govern the organisation”. Mr Nesci
referred to a plebiscite that had been conducted within the International Division of the
Association (the International Division), submitting that
The plebiscite contained a vote of no confidence in the existing council and set out a
number of measures to be taken to make the organisation better. Specifically point 9
directs “in future all proposed rule changes shall be posted on the Divisional website
and emailed to members one month prior to application submissions. Should 30 or
more members express a desire to object to the rule change, a postal or electronic
ballot of all Divisional members will be conducted to determine if the rule change will
be submitted or not.” This rule change proposes to remove the International Division.
It has not been posted on the FAAA divisional website for one month. Members have
not had an opportunity to object of raise 30 signatures that could have generated an
electronic ballot to determine if these rule changes could be submitted or not.
In lodging these changes, the FAAA may have complied with some rules but in doing
so they have ignored other rules, specifically rule 42 – control of decisions by
plebiscite.
[2015] FWCD 6955
[9] Mr Nesci further submitted that:
By way of background, the FAAA had merged the two divisions in the past and this
was unsuccessful. The two divisions were then reformed. I believe the prime motive
for the International divisional council to scrap the division is to remove upon it the
constraints made by members within the 12 point plebiscite….
[10] Mr Nesci attached a copy of a document he identified as ‘the Plebiscite’ and the
official Association Newsletter confirming the plebiscite ballot result. He also attached a
copy of his Association membership card.
[11] A copy of Mr Nesci’s objection and the attached documents were forwarded to the
Association’s solicitor, Mr Philip Gardner of Ryan Carlisle Thomas on the same day,
[12] On 8 September 2015 Mr Gardner responded on behalf of the Association. Mr
Gardner referred to the objection lodged by Mr Nesci. In relation to Mr Nesci’s allegation that
there had been a failure to comply with paragraph 9 of an International Division plebiscite,
Mr Gardner submitted:
The objection is misconceived.
Rule 42(1) provides for a plebiscite of the whole of the financial membership of the
Association in respect of Federal Council matters.
Rule 42(2) provides for a plebiscite of the financial membership of a Division in
respect of Divisional Council or Divisional Executive matters.
The plebiscite in question and relied upon by the objector was a plebiscite of the
financial members of the International Division. As such, it could not bind nor apply
to Federal Council or the whole of the financial membership of the Association.
Assuming, without conceding, the efficacy of the plebiscite and paragraph 9 of the
plebiscite, it could only ever have applied to a Rules (sic) Alteration under Rule 51(f).
The plebiscite did not, and could not, have any application to a Rules Alteration by the
Federal Council.
Accordingly, the objection is without merit.
[13] Mr Gardner further observed:
On our instructions the Divisional Council of the International Division on 13 January
2015 resolved that the plebiscite was invalid and that it would not implement the terms
of what was an invalid plebiscite.
The plebiscite as a whole was invalid as inconsistent with Rule 42.
Paragraph 9 of the plebiscite in any event was of no effect and is invalid given that it
is inconsistent with Rule 42, inconsistent with Rule 51 and incompatible with
Regulation 126.
[2015] FWCD 6955
[14] Mr Gardner contended however that it was unnecessary to fully canvass the efficacy
of the plebiscite as a whole or paragraph 9 given that even if valid, it was a Divisional
plebiscite having no effect on the Federal Council.
[15] A copy of Mr Gardner’s correspondence was forwarded to Mr Nesci on 10 September
2015.
[16] On 23 September 2015, the Commission received an objection in relation to the matter
from a Mr David Horsfall. Mr Horsfall identified himself as an Elected Councillor of the
FAAA International Division. In his objection, Mr Horsfall stated that he did not vote in
favour of the rule change due to concerns set out below:
The purpose of the rule change is to dissolve the International and National Divisions
an [sic] have the FAAA controlled only by a Federal Council.
A plebiscite was carried by members of the International Division and requires 12
actions to be put in place by the Division.
The plebiscite met of the per-requisites [sic] of the rules (majority yes votes and more
than 33% of papers returned) to make the decision binding on the FAAA.
The International Divisional Council only decided to ignore the plebiscite steps after
the ballot was counted and the result declared (I believe the FAAA was confident the
proposals would be rejected through the rigorous campaign).
Dissolving the Divisions means that the Federal Council had to ignore a carried
plebiscite within the International Division and the directions contained within it.
The direction contained within the plebiscite cannot be implemented if the
International Division ceases to operate.
The result of the plebiscite was well known to all elected Officials of the FAAA.
The Federal Council has no power to declare that a plebiscite passed under the FAAA
rules can be bypassed by changing the rules to cease operation of the International
Division.
By doing so, I believe the Federal Council overstepped their powers by ignoring a
direction carried under the FAAA rules by way of plebiscite under rule number 42.
[17] The Association’s 2015 Annual Return lists Mr Horsfall as a Councillor of the Federal
Council and an International Division Divisional Councillor.
[18] I am satisfied that the Mr Horsfall who lodged the submission is the Mr David
Horsfall identified as Councillor of the International Division and member of the
Association’s Federal Council in the 2015 Annual Return.
[19] A copy of Mr Horsfall’s correspondence was forwarded to Mr Gardner.
[2015] FWCD 6955
[20] On 23 September, Mr Nesci responded to the issues raised in Mr Gardner’s
correspondence of 8 September 2015.
[21] Mr Nesci referred to the Mr Gardner’s submission that a Divisional plebiscite cannot
direct or control a decision (in this case a rule change) because the Division is not empowered
to override the Federal Council.
[22] In response to this, Mr Nesci submitted
On the contrary, the plebiscite was passed prior to the Federal Council deciding to
amend the rules and they undertook that decision and presented changes including
motions to scrap the International Division in full knowledge of a plebiscite that had
been passed under the FAAA rules and stood as a legal decision of the organisation.
The Federal Council were well aware that their decision would require them to ignore
another earlier decision made legally by members of the International Division. The
plebiscite does not seek to extend beyond the bounds of the Division however the
Federal Council are bound to respect and act in accordance with FAAA rules and
overturning a decision that binds a decision extend [sic] beyond their powers as it
would require them to ignore something carried under the rules.
[23] Mr Nesci further submitted:
The decision to scrap the Divisions does not only ignore point 9 of the plebiscite (for
rule changes effecting [sic] the International Division, to have those changes
circulated with members first). It will also make other directions within the plebiscite
impossible to implement. They include –
Point 4 requires the International Division to respond to all member
correspondence within 3 days. Removing the Division will make this impossible
because the International Division will no longer exist.
Point 5 requires International Divisional Council meetings to take place at least
monthly and Divisional Executive meetings to occur three times annually until the
end of 2017. Removing the Division will make this impossible because the
Divisional Council and Executives will no longer exist.
Point 7 requires the formation of a committee to decide the wages of the
Divisional Secretary by way of direction to the Divisional Council. Removing the
Division will make this impossible because the Divisional Council will no longer
exist.
Point 11 requires the Divisional Council to tender out all non-legal work above
$10,000 with Divisional Council members ineligible to be awarded contracts.
Removing the Division will make this impossible because the Divisional Council will
no longer exist.
[24] Mr Nesci continued:
[2015] FWCD 6955
To achieve the two thirds majority required by the Federal Council to approve a rule
change, most International Divisional Council members when exercising a vote on the
Federal matter must have voted yes and in exercising a yes vote, ignored provisions
made under rule 42. No International Divisional Council member who was aware
of the matters contained in the plebiscite (which was all of them) were entitled to
vote yes to the Federal rule change as they were all already bound to honour a
plebiscite decision made by members of their Division. (emphasis added)
[25] Mr Nesci then turned to specific matters raised by Mr Gardner:
[26] First, Mr Nesci referred to Mr Gardner’s submission that the plebiscite “could not bind
nor apply to Federal Council or the whole of the financial membership of the Association”.
[27] Mr Nesci submitted:
I agree that a plebiscite carried under rule 42(2) that is a decision made by the
International Divisional members cannot direct the Federal Council to do anything. The
carried plebiscite however can and does direct the Divisional Council to implement
twelve measures. The decision was made under the FAAA rules well before the Federal
Council carried a motion to scrap the Division. The Federal Council have no powers
under the FAAA rules to carry and implement changes that override decisions already
made by members of either Division via a plebiscite. In passing motions to amend rules
to scrap the Divisions, the Federal Council is knowingly carrying out actions to ignore
other rules that had been followed by members. The decision made by the Federal
Council is invalid because it requires another rule to be ignored.
[28] Second, Mr Nesci referred to Mr Gardner’s submission that the plebiscite “could only
ever have applied to a Rules Alteration under Rule 51(f)… [and] did not, and could not, have
any application to a Rules Alteration by the Federal Council”.
[29] Mr Nesci submitted:
Point 9 of the plebiscite requires a notification period to members and a one month
period for International members to object to a rule change that affects the International
Division. It matters not whether the decision to amend the rules (by scrapping the
International Division) was made by the Divisional Council or the Federal Council. The
requirement to publish the change as per step 9 of the plebiscite is still valid and must
be adhered to because the decision is a binding one that was made under the FAAA
rules. The decision made by the Federal Council is invalid because it requires another
rule to be ignored.
If it is deemed that members of the Federal Council were able to ignore the carried
plebiscite because they were not International Council members, members of the
International Council must still be bound by the plebiscite decision. No member of the
International Divisional Council could exercise a yes vote to amend rules by sitting as
part of the Federal Council as doing so would require them to ignore a plebiscite that
was carried within their Division that they were bound to. A Federal motion to pass the
rule change could never be carried because a 2/3 majority is required when half the
members of the Federal Council could not vote yes because a binding decision on them
requires them to follow decisions contained within the plebiscite.
[2015] FWCD 6955
[30] Mr Nesci rejected Mr Gardner’s submission that paragraph 9 of the plebiscite was in
any event of no effect and invalid given that it was inconsistent with Rule 42, inconsistent
with Rule 51 and incompatible with Regulation 126.
[31] Mr Nesci concluded with the following two recommendations? that:
That the FAAA rule change be put aside until it is published on the International
Divisional website for one month and emailed to all members of that Division. If less
than 30 objections are received from members of the International Division, the rule
change should be approved. If 30 or more members of the Division object to the rule
change, that a ballot of members be undertaken to decide if any part of the rule change
that affects the International Division can be allowed;
Or alternatively:
That the FWC require the FAAA to provide voting details of Federal Council
members to determine if the 2/3 majority required by the Federal Council to amend
the rules did not rely upon “yes” votes from any member of the International
Divisional Council as those members were already bound by a decision of their
members to circulate the rule change for 30 days with International Divisional
members. If the motion was carried by a 2/3 majority without reliance upon “yes”
votes cast by International Divisional Council members, the rule change should be
approved. If the Federal Council did rely upon “yes” votes of International Council
members to attain the 2/3 majority that the steps outlined in recommendation a) be
followed.
[32] On 29 September 2015, Mr Gardner responded to the submissions from Mr Horsfall
and the further submission from Mr Nesci.
[33] In relation to Mr Nesci’s submission, Mr Gardner reiterated that the Association’s
Federal Council had the power to alter rules; that the Federal Council was not bound to
observe a divisional plebiscite direction/decision in respect of matters within? the powers of
the Federal Council; and the plebiscite was in any event invalid.
[34] Further to this, Mr Gardner submitted:
….the existence of some administrative decisions given by a Divisional plebiscite
cannot frustrate the Federal Council in the exercise of its powers to change the rules. If
the rules are changed such that plebiscite decisions or directions can no longer be
given effect, this is merely a consequence of the rule alterations.
[35] Mr Gardner also addressed the issue of whether International Division Federal
Councillors were entitled to vote in favour of the rule alterations, stating that:
The existence of the plebiscite direction, even if valid, could not bind Federal
Councillors from either Division in the free exercise of their vote on the rule
alteration.
[2015] FWCD 6955
[36] Mr Gardner also argued that the recommendations were a distraction and ought not be
entertained.
[37] On 30 September 2015, an email was received by Mr Nesci stating that he was
satisfied with the opportunity he has had to submit reasons in writing and was no longer
seeking a hearing in relation to the matter.
Determination of the alterations
[38] Against the background of the alterations set above, I turn now to the function
conferred by s.159 of the RO Act.
[39] Section 159 relevantly states:
159 Alterations of other rules of organisation
(1) An alteration of the rules (other than the eligibility rules) of an organisation does not
take effect unless particulars of the alteration have been lodged with the FWC and the
General Manager has certified that, in his or her opinion, the alteration:
(a) Complies with, and is not contrary to, this Act, the Fair Work Act, modern awards and enterprise agreements; and
(b) Is not otherwise contrary to law; and
(c) Has been made under the rules of the organisation.
(2) Where particulars of an alteration of the rules (other than the eligibility rules) of an
organisation have been lodged with the FWC, the General Manager may, with the
consent of the organisation, amend the alteration for the purpose of correcting a
typographical, clerical or formal error.
(3) An alteration of rules that has been certified under subsection (1) takes effect on the
day of certification.
[40] In addition, Regulation 126 of the Fair Work (Registered Organisations) Regulations
2009 sets out procedural requirements in relation to an application for certification of rule
alterations.
[41] For the reasons which follow below, I am satisfied that the alterations have been made
under the rules of the organisation.
[42] In order to form a view a view about the matter contained in subsection 159(1)(c), it is
necessary to consider the object of Mssrs Nesci and Horsfall, as well as Mr Gardner’s
responses. I have set those out in summary form above. I have however had regard to all of
the relevant facts and circumstances, including all of the submissions made in reaching my
conclusion.
[43] First I note that the rule alterations were transacted by the Association’s Federal
Council. Rule 51 provides that the Rules of the Association may be altered in either one of
the following ways –
[2015] FWCD 6955
At a duly constituted meeting of Federal Council if a two thirds majority of the
members of the Federal Council who are entitled to vote, vote in favour of any
alteration to the Rules, provided that at least thirty days written notice prior to
the closing date of the ballot is given by the Divisional Secretary to each
member of Federal Council; or
By a postal vote of members of Federal Council at which a two thirds majority
of the members of Federal Council entitled to vote, vote in favour of the
alterations provided that at least thirty days written notice prior to the closing
date of the ballot is given by the Divisional Secretary to each member of
Federal Council.
…
The respective Divisional Councils may alter the Rules but only in a manner
which affects that Division. The provisions of the Rule altered as necessary
shall apply to the making of any such alterations of the Rules by Divisional
Councils provided that a rule alteration to the rules of a Division may be
approved by a simple majority of the members of the Divisional Council of
that Division voting in favour of the alteration in accordance with this rule,
rather than the two thirds majority otherwise require by sub-rule (a). The
Divisional President and/or Secretary shall ensure than (sic) any alterations to
the Rules resolved upon by a Divisional Council is provided to the other
Divisional Council as soon as practicable.
[44] The Federal Council of the Association is a policy/management body. Its powers are
broadly defined in rule 6 as being, subject to the powers of the Divisional Councils, to
manage the affairs of the Divisions including public relations, staff, funds and industrial
matters. Subject to rule 6, the Federal Council has the power to, among other things, alter the
Rules of the Association.
[45] Rule 5(2) provides that there shall be two Divisions of the Association, namely a
National Division and an International Division. Both Divisions have a separate Divisional
Council and a Divisional Executive.
[46] Rule 6(3) defines the composition of the Federal Council as follows:
Divisional Presidents from each Division (2)
Divisional Vice-Presidents from each Division (4)
Divisional Secretaries from each Division (2)
Divisional Assistant Secretaries from each Division (2)
National Divisional Councillors (8)
International Division Divisional Councillors (8)
[47] The Rules refer elsewhere to members of the Federal Council as ‘members of Federal
Council’ and ‘Federal Officers’ as opposed to ‘members of Divisional Council’ or ‘Divisional
Officers’.
[2015] FWCD 6955
[48] The officers of the Divisional Councils are ex officio officers of the Federal Council.
It is established that the RO Act recognises that persons elected to particular offices may be
ex officio members of a body “by and from who persons are elected” and that body could be a
committee of management or other policy or management body (see re Airline Hostesses’
1
| Association | ). |
Control of decisions by plebiscite
[49] Both Mr Nesci and Mr Horsfall contend that the rule alterations in question are invalid
due to the existence of a plebiscite of International Division members the result of which was
announced on 27 November 2014. A copy of a document identified to be the plebiscite was
lodged with the Commission by Mr Nesci. Among other things, paragraph 9 of the plebiscite
directed that
In future all proposed rule changes shall be posted on the Divisional website and email
to members one month prior to application submission. Should 30 or more members
express a desire to object to the rule change, a postal or electronic ballot of all
Divisional members will be conducted to determine if the rule change will be
submitted or not.
[50] In total, twelve directions to the Divisional Council were included in the plebiscite.
[51] Rule 42 provides for the control of decisions by plebiscite. Rule 42(1)(a) relevantly
provides that decisions of Federal Council shall be final and binding on all members of the
Association unless amended or rescinded by Federal Council except that a majority of the
financial members of the Association voting by plebiscite shall have the power to (i) direct
Federal Council on a matter or matters; or veto any acts or decisions… Rule 42 provides for
some caveats and the procedure for the notification and conduct of a plebiscite.
[52] Rule 42(2) provides that “sub rule (1) of this Rule shall apply with necessary changes
to Divisional Councils and to Divisional Executive”. The rule also provides that the
references in sub-rule (1) to “members of the Association” shall be taken to be references to
members of the Division.
[53] It appears to me that the issue at hand is the effect of a Divisional plebiscite on a
subsequent decision by members of the Federal Council to alter the rules of the Association.
[54] It is clear from the rules that a plebiscite conducted under rule 42(1) – that is to say a
plebiscite of Federal members, would be binding on any relevant decisions of the Federal
Council. Any such decision would remain binding on the Federal Council until varied by an
authority of equal standing, for example, a subsequent plebiscite (see Lawrence v Porter &
2
| Ors | ). It appears that rule 42(1) has been constructed so as to vest supreme control of the |
Association by its members in relation to (a) directing the Federal Council on a matter or
matters; or (b) vetoing any acts or decisions of Federal Council.
[55] To my mind it is equally clear that a plebiscite conducted under rule 42(2) – a
plebiscite of Divisional members, would be binding on the decisions of the relevant
[2015] FWCD 6955
Divisional Councils and Divisional Executives only. The rules are written with sufficient
clarity to conclude that if it was intended that a plebiscite of Divisional members could, in
some circumstances, bind the Federal Council beyond the manner contemplated by rule 42(2),
this would be expressly provided by the same rule.
[56] It is submitted by Mr Nesci that “[t]he Federal Council have no powers under the
FAAA rules to carry and implement changes that override decisions already made by
members of either Division via a plebiscite.” The reverse of this statement is that decisions
already made by either Division must bind Federal Council in the making of decisions on a
matter or matters pertaining to its function under rule 6. Based on my understanding of rule
42, this is a conclusion which ought to be rejected.
[57] Mr Nesci also submits that the requirement articulated by the plebiscite to publish the
changes is still valid and “must be adhered to because the decision is a binding one that was
made under the FAAA rules.” I agree that the decision is a binding one, however as it was a
plebiscite of divisional members only, it is my opinion that this only extends as far as is
contemplated under rule 42(2).
[58] Mr Nesci submits in the alternative that members of the International Council must
still be bound by the plebiscite decision. Specifically
no member of the International Divisional Council could exercise a yes vote to amend
rules by sitting as part of the Federal Council as doing so would require them to ignore
a plebiscite that was carried within their Division that they were bound to.
[59] With respect to this question, I prefer the approach of Mr Gardner in his
correspondence of 29 September 2015:
….the existence of some administrative directions given by a divisional plebiscite
cannot frustrate the Federal Council in the exercise of its powers to change the rules. If
the rules are changed such that plebiscite decisions or directions can no longer be
given effect, that is merely a consequence of the rule alterations.
Mr Gardner continues:
The objector alleges that the International division Federal Councillors were not
entitled to vote in favour of the rule alterations as they were bound to honour the
plebiscite decisions
…
The subject matter of the Federal Council resolution was a rule change
and was not inconsistent with the plebiscite direction in any event; and
The existence of the plebiscite direction, even if valid, could not bind
Federal Councillors from either Division in the free exercise of their
vote on the rule alteration.
[60] In summary, I reject the submissions by Mr Nesci and Mr Horsfall that the Federal
Council had, in lodging the rule alterations, ignored rule 42 – control of decisions by
[2015] FWCD 6955
plebiscite. I acceptMr Gardner’s submission that the Divisional plebiscite could apply only to
divisional rule changes and as such had no effect in respect of the procedure to apply in
respect of resolutions of the Federal Council and the requirements for rule alterations made by
the Federal Council.
[61] I note the submission by Mr Horsfall that the Federal Council overstepped its powers
by ignoring a direction carried under the Association rules by way of plebiscite under rule
number 42. I find there is no evidence that the Federal Council acted beyond power in
resolving to alter the Rules of the Association as it was entitled to do under sub rule 6(1)(b) of
the Association’s Rules.
[62] I reject the submission by Mr Nesci that members of the International Council were
barred from exercising a yes vote to amend rules by sitting as part of the Federal Council. The
Rules clearly provide that divisional officers are ex officio members of the Federal Council.
However, it is equally clear to my mind that the office of the Federal Councillor is discrete
from a Divisional office that a Federal Councillor may hold. That the person holds the Federal
Council office ex officio rather than, for instance, via a direct election does not alter this
result. Nor is there anything in the rules which provides for the direction of a Federal
Councillor in the manner that they cast their vote. Instead, I agree with Mr Gardner’s
submission that under the rules of the Association, Federal Councillors exercise a free vote
when sitting on this body. It follows then that members of the Federal Council are entitled
under the Rules to make decisions as members of that body entirely independently of any
restrictions or encumbrances attached to the performance of their duties as officers of
divisional councils or committees.
[63] I note the arguments by Mr Nesci that changes to the rules will make certain directions
within the plebiscite impossible to implement, specifically points 5, 7 and 11. I acknowledge
that this may well be the case, as the eventual outcome of the rule alterations will result in the
dissolution of those divisions. However, most rule amendments have consequences and I
agree with Mr Gardner’s proposition that this will be a mere consequence of the rule
alterations.
[64] I note that it is well established that branches are permitted within limits to make rules
3
of their own but the rules they make derive authority from the rules of the federal body.
[65] In summary, I find the lines of reasoning outlined in the submission from Mr Nesci
and Mr Horsfall to be misconceived. Consequently, it is my finding that the objections to the
rule altering process must be rejected.
[66] Mr Gardner’s submission contends that the divisional plebiscite was invalid. This is a
contention that is expressly rejected by Mr Nesci. Based on the evidence before me, and
given the conclusion reached above, I do not believe it is necessary to make a decision on the
validity or otherwise of the plebiscite.
[67] I make the further comments about the transaction of the rule alterations.
[68] Both Mssrs Nesci and Horsfall suggested in their objections that the amendments had
been made with a particular motivation or objective. Mr Nesci stated
[2015] FWCD 6955
I believe the prime motive for the International divisional council to scrap the division
is to remove upon it the constraints made by members within the 12 point plebiscite.
Simply, the members have decided they must implement certain provisions to make
our division operate better, rather than implement those reforms, they have simply
decided to scrap the division.
[69] In a similar vein, Mr Horsfall submitted
The International Divisional Council only decided to ignore the plebiscite steps after
the ballot was counted and the result declared (I believe the FAAA was confident the
proposal would be rejected through the rigorous campaign.)…The Federal Council has
no power to declare that a plebiscite passed under the FAAA rules can by bypassed by
changing the rules to cease operation of the International Division.
[70] It appears that I am being asked to conclude that the motivations behind the rule
alterations are somehow improper and/or that the alterations have been made primarily for the
purpose of circumnavigating the obligations arising out of the divisional plebiscite.
[71] I accept the general proposition that an alteration made for an improper purpose might
be found to be beyond power. However, I find in this case that there is insufficient evidence
to suggest that that the motivation of some, most or any of the Federal Councillors was
improper in any way or somehow detracted from the appropriateness of their decision. I find
moreover the assertions of the objectors to be general in nature and devoid of specific
conversations or information to which the objectors were privy and which would support their
assertion of improper motivation. I consequently find there is an insufficient evidentiary
basis to make the findings of the type that Mssrs Horsfall and Nesci contend in their
objections.
Mr Nesci’s recommendations
[72] I now turn to the recommendations by Mr Nesci made to the Commission in his
correspondence of 24 September in respect of this matter.
[73] First, Mr Nesci submitted that the Association’s rule change be put aside until it is
published on the International Divisional website for one month and emailed to all members
of that Division. He submits that if less than 30 objections are received from members of the
International Division, the rule change should be approved. If 30 or more members of the
Division object to the rule change, that a ballot of members be undertaken to decide if any
part of the rule change that affects the International Division can be allowed.
[74] In the alternative, Mr Nesci requested that the Commission compel the Association to
provide voting details of Federal Council members to determine if the 2/3 majority required
by the Federal Council to amend the rules did not rely upon “yes” votes from any member of
the International Divisional Council.
[75] Given my finding that the divisional plebiscite does not bind the Federal Council in
this instance, I reject the former proposal.
[76] With regard to the second proposal, it is my view that information obtained as a result
of such an order would be of negligible value. I have found that International Division
[2015] FWCD 6955
members of the Federal Council can vote as members of that body, unencumbered by
restrictions that may attach to their divisional roles; and consequently are not bound by the
divisional plebiscite. Consequently, it does not matter whether or not International Division
members of the Federal Council voted in favour of the rule alterations. I therefore reject the
second recommendation.
[77] In conclusion, on the information contained in the notice and in the declaration signed
by Ms Jo-Anne Davidson on 21 August 2015 in support of the application, and for the reasons
I have articulated above, I am satisfied the alterations have been made under the rules of the
organisation.
The extension of the terms of office – temporary rule
[78] I note here for clarity, that the alterations provide for the extension of the terms of
office of National Division Divisional Officers and National Division Councillors in order to
synchronise the next elections with the elections for the International Division for the purpose
of the restructure.
[79] I find that the extension of the terms of office referred to above satisfy the
requirements of section 145 of the RO Act as the purpose of the extensions is to synchronise
the terms up to the 2016 elections with those of the International Division. It is my opinion
that the synchronisation of the terms of office provide the foundation for the Transitional
Period and the 2020 elections; and are bone fide.
[80] In my opinion, the alterations comply with and are not contrary to the Fair Work
(Registered Organisations) Act 2009, the Fair Work Act 2009, modern awards and enterprise
agreements, and are not otherwise contrary to law. I certify accordingly under subsection
159(1) of the Fair Work (Registered Organisations) Act 2009.
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1
[1980] 48 FLR 214.
2
1988] 30 IR 39, per Northrop J at 48
3
per Fullagar J in Williams v Hursey [1959] 103 CLR 30 at 54 – 55.
2
0
0