Liquor, Hospitality and Miscellaneous Union v Coca-Cola Amatil (Aust) Pty Ltd
[2009] FWA 101
•19 AUGUST 2009
Note: An appeal pursuant to s.604 (C2009/10433) was lodged against this decision - refer to Full Bench decision dated 28 October 2009 [[2009] FWAFB 668] for result of appeal.
[2009] FWA 101 |
|
DECISION |
Fair Work Act 2009
s.236 - Application for a majority support determination
v
Coca-Cola Amatil (Aust) Pty Ltd
(B2009/10375)
SENIOR DEPUTY PRESIDENT O'CALLAGHAN | ADELAIDE, 19 AUGUST 2009 |
Bargaining - majority support determination.
[1] This decision deals with an application for a majority support determination against Coca-Cola Amatil (Aust) Pty Ltd (Coca-Cola), made by the Liquor, Hospitality and Miscellaneous Union (LHMU) on 29 July 2009 pursuant to section 236 of the Fair Work Act 2009 (the Act). This application was the subject of a hearing on 17 August 2009. At this hearing, the LHMU was represented by Mr Love and Coca-Cola, by Ms Perry of counsel. The AMWU and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) appeared in these proceedings and supported the position put by the LHMU. Ms Nachiappan represented the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (AMWU) and Mr Pisoni represented the CEPU.
[2] It is appropriate that I note that, after the majority support determination application was lodged with Fair Work Australia, the LHMU made separate applications for a Bargaining Order and a Scope Order. At the LHMU request all three applications were listed together. The Bargaining Order is now listed for a separate hearing on 21 August 2009, while the LHMU now agrees that a Scope Order cannot be pursued until Coca-Cola have had a reasonable time in which to respond to its concerns.
[3] A brief background to the majority support determination issue is set out below.
[4] Coca-Cola has traditionally covered its South Australian employees with agreements reached under the South Australian legislation. The last such agreement, the Coca-Cola (Aust) Pty Ltd (South Australia) Enterprise Development Agreement, South Australia Operations 2005-2008 was terminated by the Australian Industrial Relations Commission on 11 May 2009 (PR986914). The parties to this agreement have not been able to reach an agreement on a replacement for this agreement.
[5] On 8 July 2009 the LHMU sought to reinitiate the bargaining process which had been stalled for some months. On 17 July 2009 Coca-Cola declined to participate in this bargaining proposal. The LHMU, in conjunction with the AMWU and the CEPU, then consulted with its members and was satisfied, through a petition that a majority of the Coca-Cola employees wanted to bargain with Coca-Cola for a single enterprise agreement. This application was subsequently filed with Fair Work Australia on 29 July 2009.
[6] After this application was lodged, on 12 August 2009 Coca-Cola issued notices of employee representational rights consistent with subsection 174(6) of the Act. Coca-Cola also wrote to the LHMU confirming that these notices had been issued and proposing meeting dates on 21 and 27 August. It is significant to note that the notices of employee representational rights identified three categories of employee which Coca-Cola proposed should be covered by three separate agreements. These notices also identified certain employees who Coca-Cola proposed would be excluded from the proposed production agreement.
[7] The LHMU seeks a majority support determination in its own right. Whilst the application is supported by the AMWU and the CEPU, there is no suggestion that these unions can, or should be party to the application or any consequential determination.
[8] At the hearing on 17 August 2009 the LHMU asserted that the preconditions for the making of a majority support determination had been met, in that the LHMU was a bargaining representative of employees proposed to be covered by the single agreement sought by that union. Further, that the petition of Coca-Cola employees established that a majority of employees wanted to reach an agreement. The LHMU argued that, firstly, until the application was made, Coca-Cola had refused to bargain and that even now it refused to bargain relative to a single agreement but instead had confirmed through the notices of representational rights, that it proposed separate agreements for production, warehousing and maintenance. Finally, in this respect, the LHMU argued that Coca-Cola had specifically excluded certain categories of employee from the proposed agreements.
[9] The LHMU argued that a single agreement was consistent with the history of agreement making and that three separate agreements would create disparate and iniquitous outcomes. The LHMU argued that a majority support determination would contribute to the achievement of the objects of the Act by facilitating a fair and equitable agreement outcome.
[10] The Coca-Cola position was that the AMWU and the CEPU had no standing in this matter and the LHMU had no capacity to represent the members of those unions. Coca-Cola argued that the jurisdiction to consider a majority support determination did not exist because it had agreed to bargain. In this respect, Coca-Cola referred to the negotiating sessions arranged for 21 and 27 August 2009 and the notices of representational rights which have been issued.
[11] In the course of the hearing, Coca-Cola gave an undertaking that, notwithstanding the exclusion of certain groups in these notices of representational rights, it would negotiate with respect to all of its operational employees.
[12] Finally, the Coca-Cola position was that the appropriate legislative vehicle to establish the scope of any new agreement or agreements was a Scope Order and the application represented a proposed misuse of the majority support determination provisions.
Findings
[13] Section 236 states:
“(1) A bargaining representative of an employee who will be covered by a proposed single-enterprise agreement may apply to FWA for a determination (a majority support determination) that a majority of the employees who will be covered by the agreement want to bargain with the employer, or employers, that will be covered by the agreement.
(2) The application must specify:
(a) the employer, or employers, that will be covered by the agreement; and
(b) the employees who will be covered by the agreement.”
[14] I am satisfied that the LHMU is a bargaining representative able to make the application pursuant to section 236(1) and that the application adequately identifies the proposed parties to the agreement.
[15] Section 237 states:
“Majority support determination
(1) FWA must make a majority support determination in relation to a proposed single-enterprise agreement if:
(a) an application for the determination has been made; and
(b) FWA is satisfied of the matters set out in subsection (2) in relation to the agreement.
Matters of which FWA must be satisfied before making a majority support determination
(2) FWA must be satisfied that:
(a) a majority of the employees:
(i) who are employed by the employer or employers at a time determined by FWA; and
(ii) who will be covered by the agreement;
want to bargain; and
(b) the employer, or employers, that will be covered by the agreement have not yet agreed to bargain, or initiated bargaining, for the agreement; and
(c) that the group of employees who will be covered by the agreement was fairly chosen; and
(d) it is reasonable in all the circumstances to make the determination.
(3) For the purposes of paragraph (2)(a), FWA may work out whether a majority of employees want to bargain using any method FWA considers appropriate.
(3A) If the agreement will not cover all of the employees of the employer or employers covered by the agreement, FWA must, in deciding for the purposes of paragraph (2)(c) whether the group of employees who will be covered was fairly chosen, take into account whether the group is geographically, operationally or organisationally distinct.
Operation of determination
(4) The determination comes into operation on the day on which it is made.”
[16] This section requires that Fair Work Australia must make a majority support determination provided certain preconditions are met. All these essential prerequisites for the making of a majority support determination need to be met to the satisfaction of Fair Work Australia.
[17] The actual determination itself is significant. The Act distinguishes between a majority support determination and the various other forms of orders available under this Part. The majority support determination is not an order, it is not an enforceable ruling and no penalty attaches to any contravention of the determination. This much is clear from the Act itself and is supported by the Explanatory Memorandum which states:
“976. There is no penalty for contravening a majority support determination. If FWA determines that there is majority support for collective bargaining and an employer still refuses to bargain, the employee bargaining representative may seek a bargaining order to require the employer to bargain.”
[18] I am satisfied that the employee petition makes it clear that the majority of employees want to bargain.
[19] However, I am not satisfied that Coca-Cola has now refused to bargain. Notices of representational rights have been issued and the necessary negotiating meetings have now been arranged. It might be argued that these arrangements were belatedly undertaken, but nevertheless they have occurred.
[20] To the extent that certain groups of employees may have been excluded from these intended negotiations, I accept the undertaking given by Coca-Cola such that these groups of employees will be included in the negotiation process.
[21] Subsection 236(1) refers to a proposed agreement sought by a bargaining representative. It allows for a majority support determination on the basis that a majority of employees to be covered by that agreement want to bargain. Subsection 237(2)(b) requires a refusal to bargain relative to the agreement to cover those employees. I am unable to construe the references in sections 236 and 237 to "the agreement" as the basis for the granting of a majority support determination in this situation where, whilst there is an agreement to meet, there is no current consensus on the scope of the agreement. Such an approach appears contrary to the purpose of the provision and is inconsistent with the capacity to seek a binding scope order set out in section 238. In contrast, a majority support determination is not enforceable in its own right and appears to me to serve the function of facilitating the commencement of the negotiation process and provide a precursor for other, enforceable provisions should these be necessary. This appears to be consistent with the Explanatory Memorandum:
“
• The employer has not yet agreed to bargain, or initiated bargaining, for the agreement (paragraph 237(2)(b)). If bargaining has commenced in relation to a proposed enterprise agreement, the appropriate tool to resolve issues surrounding coverage are scope orders (or bargaining orders) and not majority support determinations. This does not prevent employees of the employer who are not covered by the proposed agreement from applying for a majority support determination in relation to an agreement that will cover them;”
[22] The negotiation process which the parties are about to commence has the capacity to resolve the disputed scope issue, and, if it does not do so, a scope order may be sought provided the conditions set out in section 238 are met.
[23] In this situation I do not consider that the circumstance described in subsection 237(2)(b) has been met. This finding precludes the making of a majority support determination.
[24] As a matter of completeness, I note that I am satisfied that the group of employees in respect of whom the majority support determination was sought were fairly chosen. I hasten to add that this does not preclude other potentially fair selections of employees.
[25] It is not necessary that I deal with subsection 237(2)(d) in these circumstances.
Conclusion
[26] I do not consider that the preconditions for the making of a majority support determination have, in the situation been met. On this basis the application must be refused.
SENIOR DEPUTY PRESIDENT
Appearances:
J Love for the Liquor, Hospitality and Miscellaneous Union.
S Nachiappan for the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union.
S Pisoni for the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia.
L Perry counsel for Coca-Cola Amatil (Australia) Pty Ltd.
Hearing details:
2009.
Adelaide:
August 17.
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