Gilchrist v Australian Municipal, Administrative, Clerical and Services Union
[2001] FCA 644
•31 MAY 2001
FEDERAL COURT OF AUSTRALIA
Gilchrist v Australian Municipal, Administrative, Clerical & Services Union
[2001] FCA 644
INDUSTRIAL LAW – application for ballot for withdrawal of branch of de-registered union from amalgamated Union – validity of application – authorisation of applicants to bring application – whether branch separately identifiable constituent part – whether outline of proposal for withdrawal fair and accurate.
Workplace Relations Act 1996 (Cth) Div 7, 7A (ss 253ZH-253ZX)
Williams v Hursey (1959) 103 CLR 30 referred to
CEDRIC GILCHRIST AND ORS ON BEHALF OF THE LOCAL GOVERNMENT, COMMUNITY SERVICES, PUBLIC AUTHORITIES AND RACING (MEU) WESTERN AUSTRALIAN BRANCH OF THE AUSTRALIAN MUNICIPAL, ADMINISTRATIVE, CLERICAL AND SERVICES UNION v THE AUSTRALIAN MUNICIPAL, ADMINISTRATIVE, CLERICAL AND SERVICES UNION
W 169 OF 1999LEE J
31 MAY 2001
PERTH
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
W 169 OF 1999
BETWEEN:
CEDRIC GILCHRIST
DICK RAYNER
ADRIAN BENNETT
JUNE KIRWAN
DOUGLAS FIELDHOUSE
PETER NEWMAN
ANDREA BALLANTYNE
ANDREW JOHNSON
MEGAN KIRWAN
SEAN HEALY
ON BEHALF OF THE LOCAL GOVERNMENT, COMMUNITY SERVICES, PUBLIC AUTHORITIES AND RACING (MEU) WESTERN AUSTRALIAN BRANCH OF THE AUSTRALIAN MUNICIPAL, ADMINISTRATIVE, CLERCIAL AND SERVICES UNION
APPLICANTSAND:
THE AUSTRALIAN MUNICIPAL, ADMINISTRATIVE, CLERICAL AND SERVICES UNION
RESPONDENTJUDGE:
LEE J
DATE OF ORDER:
31 MAY 2001
WHERE MADE:
PERTH
THE COURT ORDERS THAT:
The parties present a minute by 8 June 2001 which gives effect to the reasons herein.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
W 169 OF 1999
BETWEEN:
CEDRIC GILCHRIST
DICK RAYNER
ADRIAN BENNETT
JUNE KIRWAN
DOUGLAS FIELDHOUSE
PETER NEWMAN
ANDREA BALLANTYNE
ANDREW JOHNSON
MEGAN KIRWAN
SEAN HEALY
ON BEHALF OF THE LOCAL GOVERNMENT, COMMUNITY SERVICES, PUBLIC AUTHORITIES AND RACING (MEU) WESTERN AUSTRALIAN BRANCH OF THE AUSTRALIAN MUNICIPAL, ADMINISTRATIVE, CLERCIAL AND SERVICES UNION
APPLICANTSAND:
THE AUSTRALIAN MUNICIPAL, ADMINISTRATIVE, CLERICAL AND SERVICES UNION
RESPONDENT
JUDGE:
LEE J
DATE:
MAY 2001
PLACE:
PERTH
REASONS FOR JUDGMENT
This is an application under s 253ZJ of Div 7A of the Workplace Relations Act 1996 (Cth) (“the Act”) for an order that a ballot be held to decide whether a “constituent part” of the respondent (“the Union”) should withdraw from the Union. The Union is an “amalgamated organisation” formed under Div 7 of the Act.
Most of the relevant facts were set out in the reasons of the Court on 17 October 2000 in determining an interlocutory application in the proceeding. Those reasons are to be read in conjunction with those which follow.
Division 7A of the Act (ss 253ZH-253ZX) is headed “Withdrawal from amalgamations” and the object of the Division is set out as follows in s 253ZH:
“253ZH The object of this Division is to provide for:
(a)certain organisations that have taken part in amalgamations under Division 7 to be reconstituted and re-registered; and
(b)branches of organisations of that kind to be formed into organisations and registered;
in a way that is fair to the members of the organisations concerned and the creditors of those organisations.”
Under s 253ZJ of the Act an application may be made to the Court by, inter alia, the committee of management of a “separately identifiable constituent part” of an amalgamated organisation for an order that a ballot be held to decide whether a “constituent part” of an amalgamated organisation should withdraw from the organisation. Section 253ZI(1) defines “separately identifiable constituent part” of an amalgamated organisation to mean:
“(a)if an organisation de-registered under Division 7 in connection with the formation of the amalgamated organisation remains separately identifiable under the rules of the amalgamated organisation as a branch, division or part of that organisation – that branch, division or part; or
(b)if a State or Territory branch of such a de-registered organisation under its rules as in force immediately before its de-registration remains separately identifiable under the rules of the amalgamated organisation as a branch, division or part of that organisation – that branch, division or part.”
Section 253ZI(1) also defines “constituent part”, inter alia, as a separately identifiable constituent part.
Section 253ZL of the Act provides that if the Court is satisfied as to the matters set out in s 253ZL(1)(a), (aa) and (b), the Court must order “that a vote of the constituent members be taken by secret ballot” to decide whether a constituent part of an amalgamated organisation should withdraw from the organisation. Where an application for a ballot relates to a constituent part that is a separately identifiable constituent part, a “constituent member” is defined by s 253ZI(1) as “a member of the amalgamated organisation who is included in that part.”
No argument was submitted that the provisions of the Act required the Court to perform an administrative function and not exercise the judicial power of the Commonwealth as required by the Constitution.
Section 253ZL provides that in considering whether to order that a ballot be held, the Court may hear from, inter alia, a creditor of the amalgamated organisation or any other person who would be affected by the withdrawal of the “constituent part” from the amalgamated organisation. Before the application came on for hearing, directions were made by the Court that notice of the application, and of the date of hearing thereof, be published in several newspapers. No creditor, or other person, sought to be heard on the application after publication of that notice.
The application was made by the committee of management of the Local Government, Community Services, Public Authorities, and Racing (MEU) Western Australian Branch of the Union (“the Branch”). The applicants contend that the Western Australian Division of the Federated Municipal and Shire Council Employees Union of Australia (“the FMU”), a division of an organisation de-registered in connection with the formation of the Union, remains separately identifiable under the rules of the Union (“the Union Rules”) as the Branch.
Counsel for the Union raised three grounds on which, it was submitted, the Court should not make an order for the conduct of a ballot under s 253ZL. Those grounds are dealt with as follows:
Authorisation
The Union submitted that the Branch Secretary, A F Bennett, who instructed solicitors to commence this proceeding in the name of the members of the committee of management of the Branch, was not duly authorised by that committee of management to do so.
At the annual conference of the Branch held on 7 and 8 August 1999, it was resolved that the Branch Secretary commence such a proceeding if terms and conditions specified in that resolution were not satisfied by the end of September 1999. The rules of the Branch (“the Branch Rules”) are set out in Div 12 of the Union Rules. Rule 4 of the Branch Rules provides that supreme government of the Branch is vested in the “Branch Conference” and states that the Branch Conference consists of the Branch Executive and specified delegates. The Rule further provides that the Branch Conference has: the general management and control of the affairs of the Branch; unless otherwise stated, the powers conferred by the Union Rules on the Branch Executive; and the ability to exercise any power under the Union Rules notwithstanding that the Branch Executive may have exercised a like power in the same matter. The Rule also provides that a decision of Branch Conference prevails over an inconsistent decision of the Branch Executive.
Rule 6(d) of the Branch Rules states that the Branch Executive is the committee of management for the purposes of the Act.
Rule 16(b) of the Branch Rules set out the duties of the Branch Secretary, to be carried out subject to any direction given by the Branch Conference or Branch Executive. The Rule states that no direction may be given by the Branch Executive inconsistent with a direction given by Branch Conference. Sub-rule 16(b)(viii) provides that the Branch Secretary has authority to represent the Branch in such cases as the Branch Conference or Branch Executive authorises.
Counsel for the Union submitted that the Act required the committee of management to make the application and that the foregoing provisions of the Rules would not meet the requirements of the Act if the committee of management had not instructed the Branch Secretary directly to commence the proceeding.
Under s 253ZJ an order for a ballot is directed to resolving the question whether a constituent part of an amalgamated organisation should withdraw from that amalgamated organisation. In the instant case the constituent part of the Union is said to be a separately identifiable constituent part, namely, the Branch. Where the Act provides that an application for a ballot relating to a constituent part that is a branch of an amalgamated organisation is to be made by the committee of management of the branch, it defines who has standing under the Act to move the Court for an order under s 253ZL(1). How the committee of management exercises the right provided by the Act is a matter for the rules of the amalgamated organisation.
In this matter the Branch Secretary has been instructed by the Branch Conference, pursuant to the Branch Rules, to commence the proceeding on behalf of the Branch Executive (the committee of management). The Branch Rules also require the Branch Executive to act in compliance with that direction. The proceeding, on its face, was duly commenced on behalf of the committee of management and examination of the Branch Rules confirms that to be so.
Identity of Separately Identifiable Constituent Part
The Union submitted that the Western Australian division (accepting for the purposes of the definition of separately identifiable constituent part set out in s 253ZI(1) that such a division was a “State branch”) of the de-registered organisation, the FMU, did not remain separately identifiable under the Union Rules as a branch of the Union because the Union Rules relating to ‘eligibility’ for attachment of a member of the Union to a branch of the Union, were more restrictive than had been the corresponding rules of the “State branch” of the FMU. In short, it was submitted that under the rules of the FMU both “blue collar” and “white collar” workers could be allocated to the “State branch”, whereas under the Union Rules, it was said, members of the Union allocated to the Branch were intended to be confined to “blue collar” workers.
The amalgamation of organisations effected by formation of the Union was facilitated by transitional provisions in the Union Rules which provided that members of the FMU (described therein as the MEU) allocated or assigned to branches or divisions of the FMU on the day immediately preceding amalgamation, were to be attached, on amalgamation, to the Branch. The Union Rules provide thereafter that members (ie new members of the Union) are to be attached to a branch of the Union which would traditionally have represented that employee (member) had there been no amalgamation.
The submission of the Union must be rejected. The State branch of the FMU as it existed on the day before amalgamation, was reformed after amalgamation as the Branch, by provisions of the Union Rules that stipulated that members of the FMU allocated or attached to the “State branch” became attached to the Branch on amalgamation and by providing further that thereafter members of the Union would be attached to a branch of the Union that would traditionally have represented those employees if there had been no amalgamation. That is, the Branch was to carry on the former role of the “State branch”. The Rules invested in the Branch the character of the “State branch” of the FMU as taken into the Union upon amalgamation. The scope of eligibility for membership of the FMU before amalgamation is not the determinant of the identity of a separately identifiable constituent part as defined in s 253ZI(1). Of course, a branch has no separate rules in respect of eligibility, and has no existence independent of the organisation. Eligibility for membership relates to membership of the organisation. (See: Williams v Hursey (1959) 103 CLR 30 per Fullagar J at 54-55.) Section 253ZI of the Act, however, recognises that a “branch” of an organisation, established and conducted pursuant to the rules of the organisation, may remain “identifiable” as part of the structure of the amalgamated organisation, notwithstanding that it has no separate identity at law. Such identification of a branch will derive from the class or classes of members of the organisation actually assigned or attached to the branch and the rules of the organisation relating to the branch. The issue whether a branch created under the rules of a de-registered organisation “remains separately identifiable” under the rules of an amalgamated organisation as, inter alia, a branch of that organisation is a matter of the continuity of status as a branch and of continuity of the character of a branch according to its purpose. It is by those elements that a branch may be said to be separately identifiable. The members allocated or attached to a branch, in fact and by tradition, and the functions of the branch define the branch.
The Branch Rules have continued the status and functions of the “State branch” of the FMU as it existed under the Rules of the FMU prior to amalgamation, including representation of members who were “traditionally” represented by the “State branch”. It follows that the “State branch” has remained “separately identifiable” under the rules of the Union.
The outline of the proposal of withdrawal is not fair and accurate
Under s 253ZJA(1) of the Act, the application is to be accompanied by a written outline of the proposal for the separately identifiable constituent part to withdraw from the amalgamated organisation and the subsection sets out the matters the outline must address.
Under s 253ZJA(4), if the Court is not satisfied that the outline complies with the requirements of the section, the Court must order that such amendments be made as it considers necessary for the outline to so comply.
After argument by the parties, and concessions by the applicants, the remaining issue is whether the proposal by the applicants that the rules of the proposed organisation differ from the “rules of the ‘State branch’” of the FMU in respect of eligibility for membership of the proposed organisation. The “rules of the ‘State branch’”, of course, were part of the rules of the FMU and no rules relating to eligibility were, or could be, included in the “State branch” rules.
The Union contends that the Act contemplates that withdrawal from an amalgamated organisation will be of an entity that has, and will have, continuing identity and that the provisions of the Act relating to withdrawal are not to be used as a springboard for registration of an organisation that is an expanded form of the withdrawing entity. That submission of the Union must be accepted. Section 253ZH of the Act defines the objects of Div 7A as, inter alia, to allow a branch of an organisation that has taken part in an amalgamation to be formed into a separate organisation and registered, if such a step can be taken in a way that is fair to the members of the proposed organisation and to the members of the amalgamated organisation from which the branch is to withdraw.
I do not think that the Act contemplates that the process of withdrawal and registration is to have a further function of creating a new organisation with expanded eligibility for membership over and above the membership attached to it, and from which it has derived its character and identifiable nature to that point.
Similarly, it is not open to the proponent for withdrawal to propose to intended voters that the rules of the amalgamated organisation be amended by reducing the scope of the rules relating to eligibility for membership of that organisation. Whether the Court has power to alter the eligibility rule of an organisation is unnecessary to consider. The terms of ss 253ZQA(2), (3) and 253ZR of the Act make it plain that withdrawal from membership by a member of the amalgamated organisation is at the election of the member and is not effected by the registration of the withdrawn entity as an organisation. It follows that the Act contemplates that the rules of the amalgamated organisation relating to eligibility will continue to operate for the purpose of representing the industrial interests of all members who elect to remain members of the organisation.
I will direct that the outline of proposal for withdrawal will be amended accordingly.
The Union also submitted that the proposal and application were deficient in that they failed to set out complete particulars of assets and liabilities as required by the prescribed form.
The applicants sought to meet these requirements by attaching statements of accounts but in doing so did not include some of the Notes to those accounts. That is a matter able to be corrected by attachment of the relevant material.
Further amendments to application and to outline of proposal
The application must be further amended in minor respects to give effect to the foregoing. A minute of proposed amendments has been submitted by the applicants but further minor amendments are necessary and the following orders should be made in respect of the amendment of the application, and consequential amendments made to the outline of proposal.
a) Item 5:
Item 5(a) is to be deleted.
Item 5(b) is to be deleted and the words “Schedule 3” to be inserted instead.b) Item 6:
To be amended as proposed in the minute submitted by the applicants.
c) Item 7:To be amended by deleting “(MEU)” from the description of the name of the proposed organisation.
d) Item 8:
To be deleted and replaced with the words “not applicable”.
e) Item 9:
The words “Schedule 5” be deleted and replaced with “Schedule 4” (ie Schedule 5 renumbered as Schedule 4).
f) Item 10:
Schedule 6 to be renumbered as Schedule 5 and Notes 1 to 5 referred to therein to be included in the Schedule.
g) Item 11:
Schedule 7 to be renumbered as Schedule 6.
h) Schedule 4:
The Schedule to be deleted.
i) Schedule 5:
The Schedule to be renumbered as “Schedule 4” and amended to replace eligibility rule with rule consonant with traditional attached, or allocated, membership of the “State branch” of FMU prior to de-registration of that organisation.
Conclusion
Subject to the foregoing amendments being effected, I am satisfied that the application for a ballot has been validly made and that the outline of proposal for withdrawal has fairly and accurately represented the proposed withdrawal and addressed the prescribed matters.
A ballot will be ordered accordingly.
I certify that the preceding thirty-two (32) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Lee. Associate:
Dated: 31 May 2001
Counsel for the Applicants: Hon R I Viner AO, QC
K J BennettSolicitor for the Applicants: Mony De Kerloy Counsel for the Respondent: R W Hinkley Solicitor for the Respondent: Ryan Carlisle Thomas Date of hearing:
Date submissions filed:8, 19 December 2001
11 January 2001Date of Judgment: 31 May 2001