Health Services Union

[2017] FWC 4054

[2017] FWC 4054

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.229—Bargaining order

Health Services Union
(B2017/638)

DEPUTY PRESIDENT BARCLAY HOBART, 3 AUGUST 2017

Application by the Health Services Union.

[1] The Health Services Union, Tasmania Branch has made application for bargaining orders by Application pursuant to s. 229 of the Fair Work Act 2009 (the Act) dated 27 July 2017.

[2] The Application relates to bargaining in respect to the replacement for the Healthscope Tasmania Non Nursing Employees Enterprise Agreement 2014 – 2017 (Agreement). The nominal expiry date of the Agreement is 31 January 2018.

[3] The Respondent, Healthscope Operations Pty Ltd (incorrectly described in the Application as Healthscope Operations Ltd – although I understand nothing turns on that as the Respondent led evidence about the name and noted an amendment to the Application may be appropriate by which I infer there would be no opposition to such amendment) opposes the Application and submits that it should be dismissed.

[4] For the reasons which follow I find that the Respondent has not met the good faith bargaining requirements of the Act by proposing, in the circumstances of the case, to put to ballot a final version of the proposed Enterprise Agreement (proposed EA) some 26 hours and 15 minutes after providing the further revised version of it to the Applicant. I note the revision related to “SW” which I take to be shift work. It was the shift work definition which led to early bargaining and was the issue causing most angst between the parties. I also note the version provided was described as a “further revised version” and was the fourth such version provided within 20 days.

[5] In my opinion against the background of this case seeking to put the “further revised version” to ballot was unfair conduct undermining freedom of association or collective bargaining, conduct which is to be refrained from as required by s. 228(1)(e) of the Act.

The Hearing

[6] The matter came on for hearing on short notice because the Respondent proposed to commence the access period (if it had not already done so) immediately. The Respondent also wants the proposed EA approved as a matter of urgency to remove the ambiguity it sees in the shift worker provisions of the Agreement.

[7] As such I have decided to deal with the matter urgently. Accordingly in this decision I deal with the major issues and set out the evidence of most import to my decision. If I do not recite all of the evidence or all of the arguments put to me, I have nevertheless had regard to that evidence and those submissions in reaching the decision I have.

[8] At the hearing Mr Eddington the Legal and Industrial Officer of the Health Services Union appeared for the Applicant. Mr Rinaldi of counsel sought leave to appear for the Respondent. Initially Mr Eddington opposed the application for leave. However after hearing Mr Rinaldi’s submissions he withdrew his opposition. I would have granted leave for Mr Rinaldi to appear in any event having regard to s. 596(2) (a) and (b).

Background

[9] The circumstances leading to bargaining are not in dispute.

[10] Issues have arisen between the parties regarding the definition of shift worker and day worker in the Agreement. The Applicant had made application pursuant to s. 739 of the Act in relation to alleged underpayments. I understand the underpayments would arise if the Applicants construction of the shift worker definitions in the Agreement were construed as suggested by it.

[11] Whilst the s. 739 proceedings were on foot the Respondent made an application pursuant to s. 217 of the Act to seek to remove an ambiguity or uncertainty it saw in the definition of shift worker.

[12] The s. 739 proceeding has been settled. The s. 217 proceedings are on foot and are listed for hearing of a preliminary issue before a commissioner in early September.

[13] During the negotiations to settle the s. 739 proceedings it was suggested that early bargaining in respect to the new agreement could commence so that the issues engaged in the s. 217 proceedings as to uncertainty and ambiguity may be dealt with in the bargaining process.

[14] In consequence (and without setting out every step leading up to it) a Notice of Employee Representational Rights (NERR) was issued. The notification time was either 23 June 2017 or 26 June 2017 (Mr Twyford who gave evidence on behalf of the Respondent and was responsible for issuing the NERR was unsure which of the dates commenced the notification time). Nothing turns on that for the purposes of this application.

The Evidence

[15] The issues in dispute arose between the issuing of the NERR and 27 July 2017, a period of some 4 weeks.

[16] At the hearing Ms Smith, an organiser for the Applicant gave evidence as did Mr Twyford, the General Manager – Workplace Relations of the Respondent. Ms Smith’s evidence was primarily directed to what the Applicant does to represent its members during the course of bargaining for an enterprise agreement. Mr Twyford gave evidence by way of witness statement and was cross examined. His evidence concerned the dispute and the circumstances leading up to this Application. Otherwise the evidence was documentary.

[17] The evidence is best encapsulated by exchanges of emails between the Applicant and Mr Twyford of the Respondent. Indeed the Respondents complaint and the reason behind its decision to take the proposed EA to ballot was because the Applicant was refusing to bargain and was obfuscating by its failure to respond to the Respondents emails and in particular to suggestions of meetings and to the various iterations of the new enterprise agreement it sent to the Applicant from time to time. No evidence was led regarding any discussions between the parties from the issuing of the NERR to the date of the Application.

[18] The chronology disclosed by the emails is as follows:

• 26 May 2017 – The Applicant wrote to the Respondent regarding the s 217 and 739 applications and suggested it would be better to spend time “bargaining in the traditional sense”. The email went on:

“Early bargaining could effectively have an agreement in place soon after the current agreement expires. Clearly you have proposals and no doubt employees will have claims. It will take some time for us to survey members regarding claim items. Bargaining will allow us to test your proposals through the usual mechanisms of consulting with and surveying employees as to what they are comfortable with.

• 30 May 2017 – The Applicant wrote to the Respondent about the s 217 and s 729 applications. The email included the following:

“I’ll instruct our organisers to formulate a log of claims asap but this usually takes some time. Whilst I’d be hopeful we can commence bargaining later in the year it seems that it is a bridge to (sic) far to expect a bargained outcome to be achieved at or around the same time the s 217 dispute is arbitrated. Especially given we will be filing materials along the way.

[19] I interrupt the chronology to point out I have no evidence of what the Respondents responses were (if any) to the passages I have pointed out. I also note that Mr Twyford agreed with the proposition put to him in cross examination that much energy and time was spent on settling the s 739 application. I infer that time was spent during June 2017 and may be an explanation for why the NERR was not issued until the end of June. In any event, quite properly, no complaint is made of delay prior to the issue of the NERR.

• 23 June 2017 – The Respondent emails the NERR to the Applicant. In the email Mr Twyford said:

“we agree with your suggestions that a good way to provide clarity would be via bargaining.

…………………

I’m planning to be in HBA for meetings re the new EA in the w/c 3 July and/or 10 July and/or 17 July.”

[20] The email went on to deal with issues relating to the fixing of meeting times or if face to face meetings could not be coordinated, then teleconferences could be facilitated. Mr Twyford indicated he would provide a marked up EA “in due course” and closed as follows:

“We are aiming to conduct an efficient process so we can deliver the necessary certainty and enhanced conditions as soon as possible.”

• 26 June 2017 – The Respondent writes to the Applicant again noting Mr Twyford will be in Hobart on 6 July and will be back on the week of 10 July. Mr Twyford also suggested teleconferencing if those times did not suit.



• 27 June 2017 – The Applicant emails the Respondent. The email appears in part to be a response to the emails from the Respondent suggesting meetings. It included the following:

“Like you we agree the agreement could be improved. The reality is that you have released an NERR. Unlike other Unions we don’t bargain by way of off-the-side meetings without member agreement. Once an NERR is issued we will endeavour to comply asap with our default representative obligations of conducting member meetings, surveying members, formulating claims that they wish advanced (including wages and entitlements) and then advancing those claims. Until we have had a reasonable opportunity to do that then we can’t agree to meet for bargaining. Indeed once the NERR is issued our members will begin to offer us claims items they want considered and would be highly annoyed if it we are having discussions without their instruction or involvement.

If you want to put positions to us then that is your prerogative but our position in reply on matters would first have to be approved by members.” (my emphasis)

[21] I again interrupt the chronology to note that this email did not find its way into the chain of emails attached to Mr Twyford’s witness statement which became exhibit R1. I also note that Mr Twyford did not respond to the clear indication that the Applicant would not agree to meet until it had consulted its members. Rather it seems Mr Twyford ignored or overlooked that indication as evidenced by his subsequent emails.

• 5 July 2017 – Mr Twyford emails the Applicant and forwards the first draft of the proposed EA. He also advises of his availability to meet either in person (and identifies when he will be in Hobart) or by phone.



• 7 July 2017 – The Applicant emails the Respondent to note Mr Eddington is not free to meet at the suggested times. He adds “Hopefully we can have discussions in the near future”.



• 18 July 2017 – The Respondent provides the second draft of the proposed EA and again notes availability to meet.



• 19 July 2017 – The Respondent forwards the 18 July email to Mr Kennedy of the Applicant noting that Mr Eddington is out of the office.



• 20 July 2017 – The Applicant (Mr Kennedy) emails the Respondent to indicate that it will be in touch by mid-next week with proposed meeting dates and that they expected to be able to provide a Log of Claims by mid-August.



• 21 July 2017 at 1.53 p.m. – The Respondent emails Mr Kennedy and sets out its view of the background to the matter. The email asserts a “clear strategy [on the part of the Applicant] to frustrate our search for clarity”. The Respondent reiterates its urgent need to finalise the matter.



• 21 July 2017 at 5.14 p.m. – A third version of the proposed EA is provided by the Respondent. The email notes that the Respondent “will be in touch next week regards our next steps”.

[22] The evidence Mr Twyford gave suggests this was to be in response to the email from the Applicant of 20 July 2017.

• 24 July 2017 – The Respondent provides the fourth version of the proposed EA. The email notes that Mr Twyford will come back to the Applicant regarding his comments in his second 21 July email.



• 25 July 2017 at 12.09 p.m. – The Respondent advises that it will put the proposed EA to ballot.



• 25 July 2017 at 1.59 p.m. - The Respondent provides the memorandum it proposes to send to its employees regarding the proposed EA and the ballot.



• 25 July 2017 at 3.49 p.m. – The Applicant writes asking that the Respondent not send the memorandum to the employees and indicates it will apply for bargaining orders. The email includes the following:

“We have tried to reassure you as best as possible that we have no intent to obfuscate this matter but need to survey and consult with members regarding development of log of claims. Chris Kennedy has provided you a reasonable timetable for negotiations.

We note that we are in July 2017 and the current agreement does not expire until 31 Jan 2018”.

• 25 July 2017 at 4.47 p.m. – The Respondent replies noting amongst other things the memorandum has been sent. The email reiterates the Respondent’s opinion that the Applicant has not wanted to engage with it. The email closes noting that there may be other ways forward and that the Respondent is available for discussion.

[23] Thereafter the Applicant gives notice pursuant to s 229 (4) (b) and the Respondent replied.

The Submissions

[24] I note the parties are agreed that the prerequisites to making an application and a subsequent order under sections 228 and 229 of the Act have been met save and except for the issue of good faith bargaining.

[25] Accordingly I must decide whether the Respondent has not met the good faith bargaining requirements of the Act.

The Applicants Submissions

[26] The Applicant relied on s 228 (1) (a), (c), (d) and (e) of the Act to establish that the Respondent had no met the good faith bargaining requirements.

[27] To a large extent reliance on subparagraphs (a), (c) and (d) related to the email from Mr Kennedy to the Respondent dated 20 July 2017.

[28] The Applicant submits in essence that the email from Mr Kennedy was a proposal within the meaning of subparagraphs (c) and (d) which required a proper reasoned response from the Respondent.

[29] It was submitted that the email was a proposal that the Applicant provide a log of claims by mid-August and that thereafter there would be meetings anticipated to occur in mid to late August.

[30] The emails in response of 21 July and 24 July 2017 to Mr Kennedy’s email suggest the Respondent intended to respond and may have regarded the 20 July email as a proposal. Equally it may have been to respond to the position taken by the Applicant. In the event the response was that the fourth proposed EA would be put out to vote.

[31] The Applicant suggests that the emails from the Respondent were an inadequate response (s 228(1)(c)) and evidence the fact that reasons were not provided for that response (s 228(1)(d)).

[32] Further the Applicant submits that the failure to agree to attend the meetings said to be proposed in the 20 July email was evidence that the Respondent was not attending or participating in meetings as required by s 228(1)(a).

[33] Finally the Applicant submits that putting the proposed EA to ballot in the circumstances was unfair conduct undermining collective bargaining

The Respondents Submissions

[34] In respect to the issue of the 20 July 2017 email from Mr Kennedy the Respondent submits that the email did not constitute a proposal, or a sufficiently detailed proposal to require a response from the Respondent. Accordingly, it says, sections 228 (1) (a), (c) and (d) of the Act are not engaged.

[35] In respect to the ballot the Respondent says that it was entitled to put the proposed EA to ballot and that the Applicant had refused to attend meetings which were proposed on numerous occasions and was obfuscating in respect to the proposed EA. Given the obfuscation and refusal to meet the Respondent submits it was at liberty to put the proposed EA to ballot.

Consideration

The 20 July email

[36] In my opinion the email from Mr Kennedy, property construed was not a proposal which required a response from the Respondent.

[37] The context of the email was that it was responding to the second version of the proposed EA. It was provided in the background of the emails of 26 May 2017, 30 May 2017 and 27 June 2017 which set out what it was that the Applicant needed to do to comply with its obligations to members in the bargaining process.

[38] In my opinion the 20 July email simply states what it is that the Applicant intended to do. It was not a proposal which required a response. In any event the email did not provide any specific dates for the provision of the log of claims nor for any meetings. There was really nothing to which the Respondent could usefully respond.

[39] Additionally the Respondent could not fail to attend meetings when such meetings had not been scheduled.

[40] As such I do not find that the Respondent was not bargaining in good faith as required by s 228 (1) (a), (c) and (d) in respect to the “proposal”.

The Ballot

[41] I am however of a different view in respect to the ballot.

[42] The chronology referred to above shows that from as early as 26 May 2017 the Applicant made it clear what it had to do to participate in bargaining meetings. In essence it set out what was required for it to collectively bargain.

[43] It set out the expectation that an agreement could be reached “soon after the current agreement expires”.

[44] The Applicant also informed the Respondent on 30 May 2017 that it would be “a bridge to (sic) far” to expect a bargained outcome by the time the s 217 application was to be arbitrated.

[45] After the NERR was issued the Applicant again informed the Respondent by the email of 27 June 2017 what it would need to do to be able to collectively bargain. Indeed the Respondent was told that until it had consulted with its members and formulated claims it would not be able to attend bargaining meetings. I note with interest that this email was not referred to by the Respondent.

[46] I find that the Respondent did not cavil with anything contained the May and 26 June emails regarding the expectations of the Applicant as to bargaining meetings and what it needed to do to collectively bargain. I note in passing that the procedure adopted by the Applicant to consult its members is an appropriate ground up method of collectively bargaining. The Respondent has not suggested otherwise.

[47] Thereafter the Respondent emailed the Applicant with various versions of the proposed EA and with availability to meet.

[48] It was not until its email of 21 July 2017 that the Respondent complained about the perceived delay. It asserted that the Applicant was obfuscating and delaying. It asserted that the Applicant refused to attend meetings.

[49] I disagree. At no time did the Applicant refuse to attend any meetings. From 26 May 2017 the Respondent was aware of the process which the Applicant would be required to go through. It knew that the Applicant thought that the timing for the new EA was at about when the current EA expired. It knew what steps would to be taken by the Applicant before it could meet to enable it to properly represent its members.

[50] After the 21 July email complaining of delay the Respondent provided another two versions of the EA. The final version was described as a “further revised version of the EA”. The Respondent did not say it is a final version, or that it constituted its last and best offer. It was only after the Respondent decided to put the proposed EA to a vote that it asserted it was its best offer. That of course has not yet been tested by meetings.

[51] Within 26 hours and 15 minutes of providing the “further revised version of the EA” the Respondent determines to proceed to a vote.

[52] Clearly the Respondent at all times knew what the Applicant proposed to do to bargain, what its timeframe was for bargaining and what it would do after the NERR was issued. It was reminded of all of that on 27 June 2017. The description of what the Respondent was told the Applicant would do bears all the hall marks of collective bargaining.

[53] In proceeding as it has the Respondent has failed to take into account any of that information. Indeed I find that proceeding as it has, in light of the knowledge of that which the Applicant would need to do to particulate in bargaining meetings, was unreasonable and unfair. Proceeding as it did has meant that the Applicant has not had an opportunity to finalise its survey, put together a log of claims and represent its members. That is, the Applicant has not had the opportunity to collectively bargain with the Respondent.

[54] Against that background, and the failure of the Respondent to raise issue with the method adopted by the Applicant to represent its members until 21 July 2017, putting the proposed EA to ballot is in my opinion unfair and undermines collective bargaining.

[55] I have no doubt the Respondent acted as it did because it wanted to bring the matter to a head and because of perceived urgency. However, to do so in the circumstances of this case represents a failure to bargain in good faith. Whilst the Respondent had a wish to deal with the matter urgently, I find that there was no adequate explanation for the perceived urgency.

[56] When asked whether 6 weeks (between the issuing of the NERR and mid-August) for bargaining was reasonable Mr Twyford responded that it was not. When I asked him why not his response was to the effect “because it could have been done quicker”. That is, because the process could have been done more quickly 6 weeks was unreasonable. I find that a poor basis upon which to rely for such a proposition.

[57] When I asked Mr Twyford why the Respondent determined to put the proposed EA to ballot he responded to the effect that it “wanted an agreement in place as soon as possible to provide us with certainty”. While that may be the case there does not appear to have been any prejudice to the Respondent caused by the perceived delay. As I understand it there were no outstanding underpayment claims, and the Respondent had reserved its position on the ambiguity question by keeping its s. 217 Application live and which was for preliminary hearing in early September.

[58] By disregarding the information it had about the procedure adopted by the Applicant to enable it to bargain, by not raising that process with the Applicant earlier, by providing a further revised version of the proposed EA (with no hint it was a final version) and then advising that version was to be put to ballot only 26 hours and 15 minutes after providing it to the Applicant (and thus preventing the Applicant from having any chance to raise that version with its members) the Respondent has failed to bargain in good faith.

[59] It will obviously not always be the case that putting a proposed EA to ballot where there have been no bargaining meetings will be unfair.

[60] Subsequent to the hearing Counsel for the Respondent provided me with some authorities.

[61] Mr Rinaldi relied on CFMEU v Workpac Pty Ltd 1. He referred in particular to paragraph [47] which says:

[47] I do not accept that WorkPac failed to meet the good faith bargaining requirement in s. 228(1 )(e). There is no absolute requirement for the agreement of all bargaining representatives to be obtained before a proposed agreement is put to a ballot of employees. WorkPac was transparent in advising of its intention to put its best and final offer to employees. There had been extensive bargaining over 13 meetings and the exchange of 14 drafts of the proposed agreement. There was limited scope for either party to move, it was not unreasonable for WorkPac to refuse to participate in a further meeting in the circumstances that pertained when it decided to put the proposed agreement to a ballot of employees.

[62] What is immediately apparent is that the facts of the present case are very different to those of Workpac. In that case there had been extensive bargaining. There had been 14 drafts of the proposed agreement, iterations of which no doubt arose out of bargaining. It is also noted that Workpac had but its best and final position.

[63] In the present case there have been no bargaining meetings and the draft of the proposed EA provided on 24 July 2017 was described as a further revised version. It is not clear (as it could not be as no log of claims has been provided and so the Respondent could not know the ambit of any claims of the union members and could therefore not have reached a view about any such claims) that the proposed EA was the final and best offer the Respondent had to make at the time the that version of the EA was provided. Indeed the major issue troubling the Respondent, namely the shift work definition is one in respect of which the Applicant has had no input. Indeed interestingly My Twyford has no expectation that the ballot will succeed.

[64] In my opinion Workpac is clearly distinguishable, although I do agree that there is no absolute requirement for the agreement of all bargaining representatives to be obtained before a proposed agreement is put to a ballot.

[65] The Applicant also relies on United Voice² and in particular paragraph [22] which is as follows:

[22] As to the request for an order cancelling next week’s vote of employees seeking approval of the agreement, I do not believe the Union has made out a persuasive case for such an order. Obviously, there is no requirement for bargaining representatives to reach an agreement before a vote of employees is proposed to be taken. Indeed, there have been numerous examples of vigorous, hard-fought campaigns by Unions to encourage employees to vote against an employer’s proposed agreement. In my view, unless there is a sound basis for believing the vote itself will be tainted by a failure of the Club to properly explain the terms of the agreement or a failure to comply with any of the mandatory pre-approval steps, then I consider it would not be appropriate to cancel the vote of employees. I have no such evidence before me in this case and consequently do not intend to make the order sought.

[66] However in my view this case is also distinguishable. The parties had met twice to discuss matters. The situation had reached a stalemate. In the following paragraph Sams DP said this:

[23] While I acknowledge that there has only been two meetings between the Club and the Union, it seems an unassailable proposition that the negotiations have reached a stalemate. Given these circumstances, the negotiations for a new agreement have, in my view, reached the point where it is appropriate and desirable for the views of the employees to be sought

[67] Again, this is far from the instant case. Here there have been no bargaining meetings. It is not clear that the matter has reached a stalemate. Simply the Respondent has ignored all it has been told about what the Applicant proposes to do to represent its members and has determined its quest for certainty trumps the Applicants desire to properly represent the interests of its members.

[68] The Respondent also relies on NUW v Chep³ particularly at paragraph [51]. Paragraph 51 is as follows:

[51] The company met with the NUW and gave it a copy of the agreement. It offered to meet again and consider any matter the union put forward. The NUW decided to put all of its efforts into seeking a deferral of the vote. It did not seek to discuss the agreement at the meeting at which it was handed the agreement. It did not seek a further meeting. Nor did it advance any positions or make any claims in relation to the agreement. It’s time for doing so was limited, but it was open to it to do so and it decided not to follow that path.

[69] Again that decision is clearly distinguishable. Here the Applicant has not decided to put its efforts into seeking to defer the vote. Seeking to defer the vote is a by-product of the Applicants wish to continue with the procedure it told the Respondent about in May 2017. The Applicant wishes to represent its members in the way it informed the Respondent it would. It indicated it would attend meetings 5 days before being informed that the Respondent was going to put the proposed EA to vote. As I have said there is no evidence to suggest the Applicant has refused to attend bargaining meetings. It has simply said it cannot attend meetings until it knows what issues are engaging its members.

[70] Finally the Respondents counsel has referred to the explanatory memorandum at paragraph 951. It is of little assistance as explanatory memoranda often are. It simply reiterates that which the authorities say, that conduct caught by s 228(1) (e) will be very broad and gives but a few examples.

Conclusion

[71] I find that the Respondent has not bargained in good faith by putting the proposed EA to ballot. I find that, with the knowledge that it had of the processes that the Applicant would go through, the Applicants timing for the new EA, its failure to engage the Applicant about that until 21 July, its provision of a fourth further revised version only 26 hours and 15 minutes before informing the Applicant that it would proceed to ballot and that it raised no difficulties with the Applicants position for bargaining until 21 July 2017 that the Respondent has taken part in unfair conduct that undermines collective bargaining.

[72] I reiterate that there is no evidence that the Applicant refused to participate in bargaining meetings. The Respondent was acting to advance its own interest over the interests of the Applicants members and by doing so acted unfairly within the meaning of s 228(1) (e).

Outcome

[73] At the hearing I indicated that if I found that the Respondent had failed to bargain in good faith I would hear the parties as to the orders I should make. The finding of absence of good faith in the bargaining enlivens the discretion contained in s 230 of the Act. How I should exercise the discretion should be informed by further submission.

DEPUTY PRESIDENT

Appearances:

Mr Eddington for the Health Services Union

Mr Rinaldi for Healthscope Operations Pty Ltd

Hearing details:

2017

Hobart

31 July

 1   [2017] FWC 1995

2 [2012] FWA 9047

3 [2009] FWA 202

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