Lifeflight Australia Limited v Australian Federation of Air Pilots
[2024] FWC 994
•16 APRIL 2024
| [2024] FWC 994 |
| FAIR WORK COMMISSION |
| RECOMMENDATION |
Fair Work Act 2009
s.240—Bargaining dispute
Lifeflight Australia Limited
v
Australian Federation of Air Pilots
(B2024/218)
| COMMISSIONER SIMPSON | BRISBANE, 16 APRIL 2024 |
Application to deal with a bargaining dispute – Recommendation for a second ballot.
On 13 March 2024 Lifeflight Australia Limited (Lifeflight) filed an application under s.240 of the Fair Work Act 2009 (FW Act) for the Fair Work Commission (FWC) to deal with a bargaining dispute with the Australian Federation of Air Pilots (AFAP).
There is a separate dispute (matter C2022/7360) brought under s.739 of the FW Act by the AFAP against Lifeflight filed on 7 November 2022 and currently before the Commission in relation to the interpretation of the wages clause of the Lifeflight Australia Limited Rotary Wing Pilots’ Enterprise Agreement 2021 (2021 Agreement).
Lifeflight and the AFAP have been in negotiations for a new enterprise agreement to replace the 2021 Agreement since December 2022, and met for direct negotiations eight times from December 2022 up to May 2023. Pay offers were made in May and June of 2023.
Matter C2022/7260 was the subject of two conferences before Commissioner Spencer in July 2023. The matter did not settle, and the interpretation dispute was reallocated to me for determination and I listed it for hearing on 27 and 28 September 2023.
On 27 September 2023, part way through the hearing, the parties adjourned into conference on a consent basis to make further efforts to resolve matter C2022/7360. I chaired further private conferences between the parties on 28 September, 3 October, 17 October and 1 November 2023, where considerable movement occurred from both parties to the negotiations. At the conclusion of the private conference on 1 November 2023 it was my understanding that the negotiations had progressed to a stage where, subject to some further minor drafting issues, the parties were content for a new agreement to be put to ballot, and it was envisaged that in the event that the ballot was successful, and the enterprise agreement subsequently approved by the FWC, matter C2022/7260 would be discontinued.
I understand from the parties that further direct discussions occurred between the parties in November and December 2023. It appears from material provided to the FWC that an issue arose just prior to the planned ballot in January 2024 about a final pay rise under the proposed agreement, and Lifeflight offered to resolve this issue by an undertaking to the FWC on application for approval. A final version 28 of the proposed draft enterprise agreement was put to ballot between 22 and 25 January 2024 resulting in a rejection of the proposed new enterprise agreement by a margin of 18 yes votes to 20 no votes.
In February 2023 the AFAP wrote to Lifeflight proposing to meet on 12 and 13 March. Lifeflight responded on 22 and 26 February requesting details of what the AFAP were seeking to discuss. Lifeflight filed this application under s.240 of the FW Act on the basis that it was unable to progress negotiations in the absence of a response from the AFAP and pilot representatives about the issues they wished to discuss with Lifeflight.
I conducted two private conferences in respect of this application on 26 March and 15 April 2024.
Lifeflight produced a further draft of the proposed enterprise agreement (draft 29) incorporating a further pay rise to operate from 1 July 2026. The AFAP produced a document based off Lifeflight’s draft 29, proposing a range of further changes including additional new claims. The AFAP has also provided specific information in relation to the cost of aviation medicals, loss of license insurance, and a draft Salary and Allowances Schedule and comparative information concerning other employers in the industry.
Lifeflight responded at the conference on 15 April to the AFAP amended draft 29. Lifeflight responded positively on six particular issues raised in the AFAP amended draft 29. Otherwise Lifeflight adopted a position consistent with its position at the conclusion of the discussions before the FWC in November 2023, including that it is a not-for-profit charitable organisation, and that it wishes to improve the wages and conditions of its pilots, however it had reached the limit of what it was capable of offering.
Lifeflight indicated its desire to proceed to a further ballot of employees incorporating the further amendments it is prepared to make following the conferences on 26 March and 15 April.
The AFAP indicated it is opposed to this course and will not support the proposed enterprise agreement. The AFAP also foreshadowed it would confer with its membership about formally seeking that the Commission bring back on for final hearing matter C2022/7360.
Lifeflight advised during the conference that the proposed enterprise agreement to go to ballot would include an off-set clause to provide for off-setting in the event that matter C2022/7360 proceeded to determination and the AFAP was successful.
I expressed my views to the parties toward the conclusion of the conference on 15 April about a path forward, given the protracted difficulty in concluding a new enterprise agreement, in the context of the unresolved dispute over the correct interpretation of the 2021 Agreement.
I want to be clear I express no view whatsoever about the merits of C2022/7360 or the likely outcome of the matter. It would be inappropriate to do so, and it remains live and part heard before the Commission. However, I do recall the parties to C2022/7360, who are the parties to this matter, reached a consent position to adjourn the hearing of C2022/7360 on the basis that they both believed a new enterprise agreement may be able to be reached that also settled the dispute over the interpretation of the 2021 Agreement in C2022/7360.
As stated above, the intention at the time of the adjournment was to seek to reach an enterprise agreement that would also allow for an agreement to be reached to discontinue C2022/7360 on approval of the new enterprise agreement.
It is now seems clear that an accord on both matters between the parties does not seem possible. That does not however necessarily mean that the parties must remain at loggerheads on both matters. Lifeflight wish to finalise a new agreement for its employees that will allow improvements to wages and conditions, and the AFAP have indicated the current proposal does not resolve all of its claims and they will not agree to discontinue C2022/7360.
The 2021 Agreement expired several years ago. The parties have made extensive efforts to reach final agreement to all matters and in my opinion, at least in relation to the time I have had carriage of matter C2022/7360, Lifeflight have moved a considerable distance toward the AFAP position prior to the last ballot in January, and it appears likely Lifelight are at the limit of what they believe they can offer.
The new proposed version 29 now incorporates a 3% payment from July 2026 as well as CPI adjustments to certain payments, and certain other minor concessions that version 28 did not contain. Importantly, unlike the previous unsuccessful ballot, a ballot for a proposed new agreement now will not carry with it a requirement to discontinue C2022/7360. The discontinuance would have extinguished the claim.
What is proposed now by Lifeflight is a significantly different position because approval of the proposed enterprise agreement does not carry with it an associated agreement from the AFAP to discontinue C2022/7360. The parties disagree as to the extent to which the new proposed enterprise agreement would offset any potential outcome of C2022/7360, however should a new proposed agreement go to ballot, and if the ballot is successful, dispute C2022/7360 can still be pursued to finality if the AFAP wishes to do so.
The pay rises on offer under Lifeflight’s proposed enterprise agreement are considerable. I understand from the perspective of the AFAP that it may be preferrable to have C2022/7360 determined prior to the conclusion of a new enterprise agreement, as if it succeeds, that will become the base to bargain from.
In my view, the risk with that approach is that it is likely to lead to considerable delay in the workforce actually obtaining wage increases. There is a real prospect that C2022/7360, once determined at first instance, may well become the subject of further appeal proceedings impacting on access to wage increases while also further delaying the bargaining process.
It would also appear to be a predictable outcome that in the event of a further unsuccessful ballot, and the AFAP continuing to press for claims in its amended draft 29 that were not previously the subject of bargaining prior to the January 2024 ballot, or alternatively seeking to revisit issues Lifeflight understood had been previously negotiated and settled in the course of bargaining, Lifeflight will, in response, seek to revisit other issues it says it had previously made concessions on during the course of earlier bargaining, based on understandings negotiated in the context of the overall bargained position. That course will likely lead to an unravelling of much progress previously made and even further delay.
For all of the reasons stated, it is my recommendation that a new proposed agreement should be put to a further ballot of the workforce. In the event it is carried and approved, the AFAP would still retain the ability to press its dispute in C2022/7360 if it so chooses, as was settled in the Full Bench decision in Construction, Forestry, Manufacturing, Mining and Energy Union and others v Falcon Mining Pty Ltd.[1]
COMMISSIONER
[1] [2022] FWCFB 93.
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