Health Services Union
[2024] FWC 3247
•22 NOVEMBER 2024
| [2024] FWC 3247 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.229 - Application for a bargaining order
Health Services Union
(B2024/1486)
| COMMISSIONER CONNOLLY | MELBOURNE, 22 NOVEMBER 2024 |
Application for a bargaining order – application for preservation of the status quo pending determination of scope applications – alleged failure to meet good faith bargaining requirements – alleged capricious or unfair conduct that undermines freedom of association and collective bargaining – whether relevant requirements of ss. 229 and 230 have been met – found applicant did not comply with s.229 – found no failure to meet good faith bargaining requirements – found no capricious or unfair conduct – application dismissed.
The Health Services Union (MSAV or the Applicant) is a bargaining representative of employees of Australian Red Cross Society Trading As Australian Red Cross Lifeblood (Lifeblood or the Respondent). On 18 November 2024, MSAV applied for a bargaining order pursuant to s.229 of the Fair Work Act 2009 (the Act). The application is opposed.
Lifeblood sought and was given permission to be legally represented in this matter. Given this was opposed by MSAV, I considered that the complexity of this matter justified legal representation so that it may be dealt with more efficiently and fairly in the circumstances.
The orders sought in the application filed are for Lifeblood to refrain from taking steps pursuant to sections 180 or 181 of the Act and putting a proposed agreement out to ballot, which is to open at 10:00am on Monday, 25 November 2024 and closes 4:00pm on Wednesday, 27 November 2024. The orders further seek this restraint remain in place until such time as the Commission has heard and determined the joint applications made by MSAV and the Association of Professional Engineers, Scientists and Managers Australia (APESMA) for scope orders (listed for Hearing on 17 and 18 December 2024),[1] or until another order of the Commission is made.
MSAV’s application is supported by APESMA. Having considered all the material and submissions presented in this case, I have determined to dismiss this application and set out the reasons below. Given the pending ballot and the short timeframe within which this matter was listed, heard and determined, I have resolved to deal with only those submissions of the parties to the extent it is necessary to dispose of the application.
Relevant Background
In support of its application, MSAV relied upon its submissions along with a witness statement filed by Ms Deanna Nankervis, a MSAV delegate employed by the Respondent. Lifeblood relied upon its submissions along with a witness statement of Ms Virginia Neill (Director – Employee Relations). Both Ms Nankervis and Ms Neill were cross-examined.
MSAV is a bargaining representative for its members employed by the Respondent who are currently covered by the Australian Red Cross Lifeblood Scientists Enterprise Agreement Victoria 2020. The agreement has a nominal expiry date of 30 September 2023. Since August 2023, the parties have been negotiating for an enterprise agreement to replace the 2020 agreement. MSAV and its members have been granted an order for protected action in support of its bargaining, in which its members have participated.
A significant issue yet to be resolved in bargaining is the scope of the proposed consolidated agreement known as the ‘South West Agreement’. The Respondent is seeking significant changes, including that the proposed agreement incorporate a number of other agreements presently the subject of bargaining. Relevantly, these other agreements include: the Australian Red Cross Lifeblood Enterprise Agreement South Australia 2020, Australian Red Cross Lifeblood Western Australian Manufacturing and General Enterprise Agreement 2021; the Australian Red Cross Blood Service General Enterprise Agreement Tasmania 2017 and the Australian Red Cross Blood Service General Enterprise Agreement Victoria 2017.
There are no less than 12 other bargaining representatives that have been participating in negotiations. To date, there have been no less than 20 separate bargaining meetings. MSAV have attended each of these meetings. Typically, there have been 20-30 attendees at each meeting which have generally been 2-3 hours long. MSAV and its members have opposed the Respondent’s proposed scope of the proposed agreement for reasons which have been discussed during negotiations. A previous version of the proposed agreement has not been approved by employees following a ballot held in accordance with s.181 of the Act.
The scope of the proposed new agreement continues to remain unresolved. On 10 October 2024, MSAV made an application under s.238 of the Act for the Commission to make a scope order with respect to its claims for the proposed agreement to apply to its members employed by Red Cross Lifeblood who are currently covered by the Australian Red Cross Lifeblood Scientists Enterprise Agreement Victoria 2020.[2] Shortly thereafter, APESMA also made a s.238 application for a scope order with respect to its claims for the proposed agreement to apply to its members.
Both these applications have been allocated to my Chambers for determination. Lifeblood opposes both applications. On 22 October 2024, I convened a joint Mention for the s.238 applications in order to program them for determination. At the Mention, MSAV sought an undertaking that Lifeblood would not proceed to another vote on the proposed agreement until after its scope application had been determined. Lifeblood did not provide this undertaking. MSAV foreshadowed the potential for an application to be made to the Commission to prevent the ballot from proceeding.
On 24 October 2024, Lifeblood issued a communication to its employees confirming its intention to return to a vote on the proposed agreement, stating “ideally before the end of the year.”[3] On 7 November 2024, Lifeblood reconfirmed this intention as follows:
“…we’re turning our attention to when we could return to a vote. As we’ve stated, we’d like to do this before the end of the year so that we can pay you your wage increases and backpay before Christmas.”[4]
On 12 November 2024, Lifeblood confirmed its decision to proceed to a vote, and on 15 November 2024, advised employees of the commencement of an access period, with the ballot on the proposed agreement to commence Monday, 25 November 2024. On the same day, MSAV emailed both the Commission and Lifeblood foreshadowing its concerns that proceeding to vote was contrary to the good faith bargaining provisions, along with this application.
At approximately 9.50am on Monday, 18 November 2024, MSAV sent written notice to Ms Neill setting out these concerns.[5] Relevantly, this correspondence indicated as follows:
“…we are concerned about Lifeblood putting a further proposed agreement into the access period that precedes a formal ballot approval. There is a serious question before the Commission that needs to be tried, with respect to matters including fairness to members of the Union should the current proposed scope prevail. It is inappropriate, therefore, for Lifeblood to seek to forestall the determination of this question by rushing again to ballot the proposed agreement.
The Union has very real concerns that Lifeblood’s actions, including the timing of these actions, amounts to capricious and unfair conduct that undermines freedom of association and collective bargaining.
You are also already on notice of our concerns that bargaining is not proceeding efficiently or fairly as a result of there being so many bargaining representatives involved…”
At 11.12am the same day, MSAV made this application with the Commission. It is also the case that since this time, Lifeblood have invested in meetings and communications with its employees informing them of the terms of the proposed agreement.
MSAV’s application is in the following terms:
“The Applicant is seeking an urgent order that until the hearing and determination of matters B2024/1330 and B2024/1337, or until further order of the Fair Work Commission, the Respondent be restrained from taking steps under sections 180 or 181 of the FW Act.”[6]
A draft order proposed by MSAV includes a further term that:
“For the avoidance of doubt, the Respondent is ordered to ensure that the ballot scheduled to open on Monday 27 (sic) November 2024, in connection with a request under section 181 of the Act, does not proceed.”[7]
On receipt of MSAV’s application, my Chambers issues directions for the filing of evidence and material to allow the matter to be determined. A Hearing was scheduled for 4:00pm on Thursday, 21 November 2024. Mr Conor Serong appeared for the Applicant. Mr Leigh Howard (Counsel) appeared for the Respondent with leave being granted. Several other bargaining representatives were also in attendance, including Mr Nathaniel Haregrave on behalf of APESMA, who provided brief written submissions.
Submissions
MSAV
MSAV seeks the Commission exercise its discretion pursuant to s.229 by making the order in the terms sought. Its principal submissions are that (1) the Commission can be satisfied that the Respondent has not complied with the good faith bargaining requirements in the circumstances of this case, in particular s.228(e.). That (2) the requirements of s.229 have been met, or that in the circumstances of this case it is appropriate that the Commission be so satisfied. That (3) the Commission can be satisfied the requirements of s.230 have been complied with, in particular ss. 230(1) (c) and 230(3).
In further support of its position, the Applicant’s position is that its scope application presently before the Commission is a serious question to be tried and that that balance of convenience weighs in favour of the Applicant in the circumstances, which should weigh heavily towards the making of the order.
Lifeblood
Lifeblood presents five grounds on which they submit the order ought not to be made. Firstly, it is their position that the Act prohibits the making of an order that requires an “employee to approve, or not approve, a proposed enterprise agreement” pursuant to s.255(1)(c). Second, that MSAV’s application has not been validly made in not complying with the requirements of s.229(4). Third, that the Commission has no power to make interim orders pursuant to s.230. Fourth, that MSAV has not established, on a prima facie basis, that Lifeblood has not complied with its good faith bargaining obligations. And finally, that the balance of convenience weighs against the making of an order.
Consideration
Pursuant to s.230, the Commission may make a bargaining order where an application is made under 229, if it is satisfied that one of the circumstances in subsection 230(2) applies, the requirements in subsection 230(3) have been met, and it is reasonable in the circumstances to do so.
Section 229 provides that an application may be made by a bargaining representative for a proposed enterprise agreement if they have concerns that another bargaining representative has not met the good faith bargaining requirements set out in section 228(1), they have given written notice setting out those concerns to the other bargaining representative, given them a reasonable time to respond to those concerns, and considers the bargaining representative has not adequately responded to those concerns.
Leaving aside questions of the powers (and their limitations) of the Commission under s.230 and s.255, to which I shall briefly return, what is necessary to determine in this matter is whether the Respondent has failed to meet, or are not meeting, the good faith bargaining requirements set out in s.228(1).
In submissions, references were made to the good faith bargaining obligation in s.228(d) - giving genuine consideration to proposals of other bargaining representatives and giving reasons for the bargaining representative’s responses to these proposals, and the good faith bargaining obligation in s.228(e.) - refraining from capricious or unfair conduct that undermines freedom of association or collective bargaining.
Regarding s.228(d), there is no substantive evidence before me to lead to a conclusion that this obligation has not been meet. On the contrary, the material presented, including in excess of 20 bargaining meetings and a proposed agreement inclusive of terms and conditions applicable to MSAV members, suggests otherwise.
The gravamen of this dispute is whether in entering the access period and proposing to commence a ballot on the proposed agreement on 25 November 2024, Lifeblood is acting in a capricious or unfair way that undermines freedom of association or collective bargaining, contrary to s.228(1)(e).
Only if I am satisfied that this is the case am I required to determine whether, in the overall exercise of my discretion, I am satisfied that it is reasonable in all the circumstances of this case to make the orders sought by MSAV (s.230(1)).
What I must determine in this case is as follows:
Has the Applicant complied with the requirements of s.229?
Has the Respondent breached their good faith bargaining requirements by engaging in capricious or unfair conduct that undermines freedom of association or collective bargaining (s.228(1)(e) and s.230(3)(a)(i))?
Is the bargaining process not proceeding efficiently or fairly because there are multiple bargaining representatives for the agreement (s.230(3)(a)(ii))?
Is it reasonable in all the circumstances to make the orders sought (s.230(1)(c)?
I consider each of these questions in turn.
Has MSAV complied with the requirements of s.229?
The requirements of s.229(1)-(3) are not in contest. There is no contest MSAV has provided written notice of its concern that Lifeblood is not meeting its good faith bargaining requirements and that bargaining is not proceeding efficiently or fairly by virtue of its correspondence sent at 9.50am on 18 November 2024 (s.229(4)(a)). It is not accepted that MSAV has complied with s.229(4)(b)-(d).
MSAV accepts it has failed to send its letter of concern to all bargaining representatives. They contend Lifeblood is the only relevant bargaining representatives in relation to its concerns. MSAV also accept that they have only provided Lifeblood with little over an hour in which to respond to its concerns. They contend that this is a reasonable period in the circumstances of this case. Circumstances such that an access period has commenced, a ballot is pending, and the Respondent has been on notice since the Mention before me on 22 October 2024 of its objections to an agreement being put out to vote prior to its scope application being determined. MSAV’s further submission is that Lifeblood had been on notice of its concerns since 22 October 2024 or at latest Friday, 15 November 2024 when MSAV sent Ms Neill an email foreshadowing this application, has had reasonable time to respond to its concerns but has chosen not to.
I do not accept that MSAV has complied with the requirements of s.229(4). Particularly, I do not accept that 1 hour and 23 minutes is a reasonable period of time to consider serious concerns.
Given this conclusion, MSAV submit the Commission should still consider its application because it can be satisfied in all the circumstances that it is appropriate to do so as provided by s.229(5). Lifeblood rejects this on the basis that the circumstances of this case are such that MSAV had no genuine intention on complying with the requirements of s.229 as indicated by their email to the Commission on 15 November 2024 flagging this application.
I have considered these submissions. MSAV do not accept that they have acted disingenuously in only allowing a little over an hour for Lifeblood to respond or that they were being anything other than prudent by informing the Commission and Lifeblood of the possibility of an urgent s.229 application being made. I accept these submissions.
In reaching this conclusion, I find the evidence of Ms Neill instructive, that it was not until 12 November 2024 that Lifeblood made a final decision to enter the access period and procced to vote. This evidence supports MSAV’s submissions that its failure to comply with the requirements of s.229 arose from the particular circumstances of this case, and the urgency required to bring an application to the Commission (if required) in order to protect the potential utility of its scope application.
I am further satisfied that Lifeblood was well aware of the potential for this application being made as early as the Mention before me on 22 October 2024 when it is accepted MSAV brought it to Ms Neill’s attention as a “potential”. In these circumstances, I am satisfied Lifeblood was provided advance notice of MSAV’s concerns such that it could have been reasonably expected to anticipate them and be in a position to quickly respond.
It follows from the above, that I am satisfied it is appropriate in all the circumstances to consider MSAV’s application even when it does not comply with s.229(4)(b) or (c) as provided for by s.229(5). I am also satisfied that MSAV has rightly concluded Lifeblood has not appropriately responded to its concerns as there is no evidence of this being the case prior to this application being made (s.229(4)(d)).
Has the Respondent breached their good faith bargaining requirements by engaging in capricious or unfair conduct that undermines freedom of association or collective bargaining (s.228(1)(e) and s.230(3)(a)(i))?
In making its case that the Respondent has breached its good faith bargaining requirements, MSAV submit the Respondent has acted capriciously and unfairly in a way that undermines freedom of association or collective bargaining by:
Putting the proposed agreement out to vote before its scope order application can be heard and determined, it being a serious question to be tried before the Commission, inter alia fairness to bargaining;
Acting in spite of the concerns of MSAV’s members regarding their minority status within their proposed scope and the consequences for their capacity to bargain; and
Seeking to sow division between MSAV members and other members of its workforce within the proposed scope, seeking to blame them for delays in the agreement making process.
Lifeblood rejects these submissions. Their position is that there is nothing capricious or unfair in its decision to proceed to vote. Rather, that its actions are simply an exercise of its rights under the bargaining regime. That it has been clear about its intention to put the agreement out to vote prior to the end of year from 24 October 2024. And the fact that it is exercising its rights may have consequences for MSAV and its members does not, as a consequence, make it a capricious or unfair act that undermines freedom of association or collective bargaining.
This question requires a finding that “capricious or unfair conduct” was engaged in, and then that the conduct “undermined freedom of association or collective bargaining”.
Previous decisions of the Commission have considered what is the ordinary meaning of these terms. It can be understood from the Oxford Dictionary that “capricious conduct” involves an unaccountable change of mind. In CFMEU v Oaky Creek Coal, citing CFMEU v Anglo Coal (Capcoal Management) Pty Ltd T/A Capcoal,[8] Deputy President Asbury (as she was then) set out the elements of the two limbs of s.228(1)(e) relevantly as follows:[9]
· Capricious conduct is conduct which is unaccountable, whimsical, irregular or unpredictable, or conduct that is not valid, defensible, or well founded.
· Conduct that is unfair is conduct that is not equitable or honest or not impartial or according to the rules.
· To undermine collective bargaining or freedom of association means to injure or damage, including by secret or insidious means.
· It does not follow that because conduct adversely impacts on the position of a bargaining representative, it will be conduct that undermines that position.
· While intent may be relevant to whether there has been a breach of good faith bargaining requirements, it is not determinative and there is no requirement to establish intent in order to find a breach.
· Fairness cuts both ways, and the interests of employers and employees must be balanced. The good faith bargaining requirements do not require that an employer can take no action or protect its interests or advance its position whilst bargaining is underway.
· The terms of s 231(2)(c) and (d) of the Act which provides that the Commission may make orders do not operate unless and until the Commission is positively satisfied to the required standard of proof that a bargaining representative is not complying with a good faith bargaining requirement;
· Fairness in a given situation depends on the circumstances and the context in which it is addressed.
I accept this is the correct approach to the application of these provisions and have applied it to the circumstances of this case
I appreciate the position in which MSAV and its members have found themselves. I accept they are a consequence, in part, of the conduct of the Respondent. However, there is no substantive evidence before me to conclude that the Respondent’s conduct has been unaccountable, whimsical, irregular or unpredictable, or conduct that is not valid, defensible, or well founded. Nor am I satisfied the Respondent’s conduct has been conduct that is unfair not equitable or honest or not impartial or according to the rules. The evidence does not support this conclusion.
I am, therefore, not satisfied that Lifeblood is in breach of its good faith bargaining obligations and cannot be satisfied that the requirements of s.230(3)(a)(i) have been meet.
Is the bargaining process not proceeding efficiently or fairly because there are multiple bargaining representatives for the agreement (s.230(3)(a)(ii))?
In the alternative to section s.230(3)(a)(i), s.230(3)(a)(ii) provides a requirement the Commission must in all cases be satisfied that the bargaining process is not proceeding efficiently or fairly because there are multiple bargaining representatives for the agreement.
There is no contest there are over 12 bargaining representatives involved in these negotiations. Nor is there any contest that bargaining has been proceeding, as there is agreement that there have been 20 or more bargaining meetings to date. What is in dispute is whether bargaining is proceeding efficiently or fairly.
MSAV contends that bargaining is inefficient, laborious, and unproductive. Ms Nankervis’s evidence supports this position. She submits MSAV members claims have not been heard, have not been fully discussed or frequently dismissed as unachievable. Lifeblood’s evidence, in the form or Ms Neill’s statement and supporting materials, presents a different perspective. Lifeblood accepts that bargaining has taken a considerable period of time and involves multiple bargaining representatives. However, they submit that given 20 meetings have occurred, all claims have been discussed and agreements have been prepared ready for employee consideration, it cannot be sustained that bargaining has been proceeding inefficiently or unfairly.
In the circumstances of this case, I accept that the evidence of the Respondent supports this conclusion. The test is an objective one. While I accept from MSAV’s perspective it may seem the bargaining process has been inefficient or unfair, it does not necessarily follow that this is the case. The evidence before me of over 20 bargaining meetings, however large, where claims have been discussed and proposed agreement documents produced for employee consideration suggest otherwise.
Accordingly, it follows that I am also not satisfied that the bargaining process has not been proceeding efficiently or fairly because there are multiple bargaining representatives for the agreement (s.230(3)(a)(ii)). In making this finding, I note that MSAV has participated in every bargaining meeting and contends that it has raised its concerns with the proposed scope of the agreement at every opportunity in this process. It has chosen to participate in this process. It has also chosen to wait until 10 October 2024 to bring its application for a scope order before the Commission.
Is it reasonable in all the circumstances to make the orders sought (s.230(1)(c)?
As I have not been satisfied the requirements of s.230(c) are met, it follows that I cannot be satisfied that it is reasonable in all the circumstances to make the order sought.
Additional Objections of the Respondent
As identified in paragraph [20] above, the Respondent identified two additional objections to support its position that the application be dismissed that are yet to be addressed. First, that s.255(1)(c) prohibits the making of an order by the Commission that requires an “employee to approve, or not approve, a proposed enterprise agreement”. Second, that the Commission has no power to make interim orders pursuant to s.230.
Given that I have not been satisfied the relevant requirements of s.229 or s.230 have been meet I will not address these submissions in full. For completeness, however, I make the following remarks.
Firstly, I do not accept the Respondent’s submission that the orders sought would contravene section 255(1)(c) of the Act. I do not accept in this instance the order sought requires or has the effect of requiring the “employee to approve, or not approve, a proposed enterprise agreement”. The effect of this order goes to the consideration of a proposed enterprise agreement, not approval. I respect the Respondent referring me to the decision of Deputy President Beaumont in CEPU v Powertech.[10] However, I prefer the view of Deputy President Anderson in AMIEU v Thomas Foods[11] at [55] and Commissioner Cambridge in AIMPE v Svitzer Australia Pty Ltd; the Maritime Union of Australia; and the Australian Maritime Officers’ Union[12] at [19], amongst others.[13]
Secondly, with respect to the powers of the Commission to make interim orders pursuant to s.230 of the Act. The powers of the Commission to make interim orders are well established. Similarly, the relevant tests that there is a serious question to tried and that the balance of convenience weighs in favour of the making of an order are not in contest.[14] In the present case, the Applicant presses that it seeks a substantive order. The Respondent’s position is that the order sought, its urgency, form and basis are clearly interlocutory. They seek a preservation of the status quo until the scope order applications can be heard and determined.
The terms of the draft order are clearly framed in an interim way so that it is to operate until MSAV and APESMA’s scope applications are determined, or a further order of the Commission is made. However, I do not accept that that the order cannot be made. Rather, as observed by Deputy President Asbury (as she was then) in CEPU v Powerlink at [27]:
“There is nothing novel about the form of the order proposed…In my view it seeks interim relief and foreshadows a further order for final relief in the event that the scope application succeeds. Such an order was made by a Full Bench of the Commission in Health Services Union v Victorian Hospitals’ Industrial Association and Others in virtually identical terms to that sought… It is therefore appropriate to consider whether there is a serious issue to be tried and whether the balance of convenience favours granting the Order.”[15] (footnotes omitted)
In the present case, I accept that MSAV’s application for a scope order is a serious issue to be tried. In the circumstances of whether the Commission should exercise its discretion to make a bargaining order the serious issue is whether, amongst other things, there has been a breach of the good faith bargaining provisions. Section 230 of the Act make this a requirement. It also prescribes a power for the Commission to make a bargaining order where an application is made under 229, if it is satisfied that one of the circumstances in subsection 230(2) applies, the requirements in subsection 230(3) have been met, and it is reasonable in the circumstances to do so.
In the present case, for the reasons set out above, I have not been satisfied that the requirements of subsection 230(3) have been met, even on a prima facie basis, and the application must be dismissed.
In reaching this conclusion, I have also considered whether the balance of convenience weighs in favour of the making of the order. In this regard, I have considered the Applicant’s submissions on the significance of a successful ballot next week for its scope application and the detriment such an outcome will have on its members. I am not persuaded, however, that when considered against the actions taken by the Respondent to date and any delay in it being allowed to proceed weighs in favour of the making of an order. Particularly, I note at present MSAV and its member are not without options. They can continue to press for a no vote, and even if the ballot is approved, can seek to oppose the approval of any agreement voted on by the Commission.
Accordingly, this application is dismissed.
COMMISSIONER
Appearances:
Mr C Serong and Ms C Gaul on behalf of the Applicant.
Mr L Howard of Counsel, with Ms A Agostino and Ms C Fenton, solicitors on behalf of the Respondent.
Hearing details:
21 November.
Melbourne.
2024.
[1] B2024/1330 and B2024/1377.
[2] B2024/1330.
[3] Witness Statement of Virginia Neill at VN1, Court Book page 42.
[4] Ibid at VN2, Court Book page 45.
[5] Witness Statement of Deanna Nankervis at DN-03, Court Book page 26.
[6] Form F32 at 2.5, Court Book page 217.
[7] Proposed Draft Order, Court Book page 14.
[8] [2016] FWC 8847.
[9] [2017] FWC 5380 at [165].
[10] [2021] FWC 1182.
[11] [2015] FWC 8334.
[12] [2015] FWC 8334.
[13] NUW v CHEP Australia (2009) 188 IR 134 at [43] per Watson VP.
[14] ABC v O’Neill (2006) 227 CLR 57; Wills v Grant, Marley and the Government of NSW, Sydney Trains[2020] FWCFB 4514; HSU v Victorian Hospitals Industrial Association and Others (2012) 221 IR 1.
[15] [2014] FWC 8812.
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