Maritime Union of Australia, The v MMA Offshore Vessel Operations Pty Ltd

[2016] FWC 2481

[2016] FWC 2481 [Note: An appeal pursuant to s.604 (C2016/4034) was lodged against this decision.]

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.437 - Application for a protected action ballot order

Maritime Union of Australia, The
v
MMA Offshore Vessel Operations Pty Ltd
(B2015/1766)

VICE PRESIDENT WATSON MELBOURNE, 17 MAY 2016

Proposed protected action ballot of employees of MMA Offshore Vessel Operations Pty Ltd – - Whether application validly made having regard to notification time and requirements for protected industrial action – Whether genuinely trying to reach agreement – Extension of notice period – Fair Work Act 2009 – ss. 173(2), 408, 414, 437 and 443.

Introduction

[1] An application was made by the Maritime Union of Australia (MUA) under s.437 of the Fair Work Act 2009 (the Act) for a protected action ballot order on 30 December 2015. The application relates to employees of MMA Offshore Vessel Operations Pty Ltd (MMA Offshore) to whom the Mermaid Marine Vessel Operations Pty Ltd Integrated Ratings, Cooks, Caterers and Seafarers (Offshore Oil and Gas) Enterprise Agreement 2010 and the Mermaid Marine Vessel Operations Pty Ltd Integrated Ratings, Cooks, Caterers and Seafarers Gorgon Enterprise Agreement 2011 applies and who are members of the MUA. The application was strongly opposed by MMA Offshore.

[2] The MUA and MMA Offshore led lengthy evidence in relation to the application on 22 January, 8 and 17 February 2016. The matter was concluded by written final submissions of the parties and supplementary submissions concerning a relevant Full Bench decision handed down in the intervening period.

[3] At the hearing of this matter Mr R. Hooker, of counsel, appeared for the MUA and Mr D. Parker, of counsel, appeared on behalf of MMA Offshore.

Legislative Provisions

[4] The grounds for approving the making, or making a protected action ballot order, are governed by s.443 of the Act. The Commission is required to make a protected action ballot order if it is satisfied that paragraphs (a) and (b) of section 443(1) are met. Section 443 provides:

“443 When the FWC must make a protected action ballot order

(1) The FWC must make a protected action ballot order in relation to a proposed enterprise agreement if:

(a) an application has been made under section 437; and

(b) the FWC is satisfied that each applicant has been, and is, genuinely trying to reach an agreement with the employer of the employees who are to be balloted.

(1) The FWC must not make a protected action ballot order in relation to a proposed enterprise agreement except in the circumstances referred to in subsection (1).

(2) A protected action ballot order must specify the following:

(a) the name of each applicant for the order;

(b) the group or groups of employees who are to be balloted;

(c) the date by which voting in the protected action ballot closes;

(d) the question or questions to be put to the employees who are to be balloted, including the nature of the proposed industrial action.

(3A) For the purposes of paragraph (3)(c), the FWC must specify a date that will enable the protected action ballot to be conducted as expeditiously as practicable.

(1) If the FWC decides that a person other than the Australian Electoral Commission is to be the protected action ballot agent for the protected action ballot, the protected action ballot order must also specify:

(a) the person that the FWC decides, under subsection 444(1), is to be the protected action ballot agent; and

(b) the person (if any) that the FWC decides, under subsection 444(3), is to be the independent advisor for the ballot.

(1) If the FWC is satisfied, in relation to the proposed industrial action that is the subject of the protected action ballot, that there are exceptional circumstances justifying the period of written notice referred to in paragraph 414(2)(a) being longer than 3 working days, the protected action ballot order may specify a longer period of up to 7 working days.

Note: Under subsection 414(1), before a person engages in employee claim action for a proposed enterprise agreement, a bargaining representative of an employee who will be covered by the agreement must give written notice of the action to the employer of the employee.”

[5] The MUA submits that all of the requirements for making the order have been satisfied. It submits that the application has been validly made having regard to subsection 437(2A) because there was a notification time for the purposes of s.437. This provision relevantly provides that:

“437 Application for a protected action ballot order

Who may apply for a protected action ballot order

(1) A bargaining representative of an employee who will be covered by a proposed enterprise agreement, or 2 or more such bargaining representatives (acting jointly), may apply to the FWC for an order (a protected action ballot order) requiring a protected action ballot to be conducted to determine whether employees wish to engage in particular protected industrial action for the agreement.

(2) Subsection (1) does not apply if the proposed enterprise agreement is:

(a) a greenfields agreement; or

(b) a multi-enterprise agreement.

(2A) Subsection (1) does not apply unless there has been a notification time in relation to the proposed enterprise agreement.

Note: For notification time, see subsection 173(2). Protected industrial action cannot be taken until after bargaining has commenced (including where the scope of the proposed enterprise agreement is the only matter in dispute).”

[6] Section 437 accordingly directs attention to s.173(2) which provides:

“Notification time

(2) The notification time for a proposed enterprise agreement is the time when:

(a) the employer agrees to bargain, or initiates bargaining, for the agreement; or

(b) a majority support determination in relation to the agreement comes into operation; or

(c) a scope order in relation to the agreement comes into operation; or

(d) a low-paid authorisation in relation to the agreement that specifies the employer comes into operation.

Note: The employer cannot request employees to approve the agreement under section 181 until 21 days after the last notice is given (see subsection 181(2)).”

The Contested Issues

[7] MMA Offshore advances the following arguments, a number of which are expressed in the alternative:

• the application has not been validly made having regard to subsection 437(2A) of the Act;



• the application has not been validly made having regard to the requirements for “protected industrial action” in s.408 of the Act;



• the MUA has not demonstrated that it has been genuinely trying to reach an agreement under the Act;



• the Commission should adjourn the application pending the determination of Federal Court and bargaining order applications; and



• the Commission should extend the period of notice for industrial action required under s.414(2)(a) of the Act.

[8] To the extent necessary I will consider each of these matters in turn.

Notification Time

[9] In order to satisfy this criterion it is necessary to determine, in this case, whether MMA Offshore has agreed to bargain for the proposed enterprise agreement that is subject to the application. It is sufficient to note that negotiations for new agreements between MMA Offshore and the MUA have been taking place for a considerable period of time. One of the major contested issues is the scope of the agreement. MMA Offshore has sought an agreement covering all seafarers on its offshore vessels engaged in the oil and gas industry. Such a scope would cover officers, engineers, cooks, caterers and ratings. It has been referred to as the “one-fleet” scope because it covers all employees on these vessels. The MUA has proposed agreements covering seafarers eligible to belong to the MUA – cooks, caterers and ratings.

[10] The MUA contends that a notification time for the purposes of subsection 437(2A) occurred on or around 2 October 2015 when MMA Offshore wrote to the MUA attaching a copy of the company’s proposed enterprise agreement, or in or around December 2012 when MMA Offshore agreed to bargain for an agreement to replace the Mermaid Marine Vessel Operations Pty Ltd Integrated Ratings, Cooks, Caterers and Seafarers (Offshore Oil and Gas) Enterprise Agreement 2010 and the Mermaid Marine Vessel Operations Pty Ltd Integrated Ratings, Cooks, Caterers and Seafarers Gorgon Enterprise Agreement 2011.

[11] The MUA submits that, having regard to the purpose and effect of the new subsection 437(2A), in a broad textual sense the term “proposed enterprise agreement” is generic and allows for a variety of possibilities. It contends that the scope of a proposed enterprise agreement is a matter which can be the subject of bargaining, and that a disagreement over scope is irrelevant for the purpose of identifying the proposed enterprise agreement to which s.437 might relate. It further notes that while the “proposed enterprise agreement” in s.437(1) is the enterprise agreement proposed by the application for a protected action ballot order at the time the application is made, it does not follow that subsection 437(2A) requires that there has been a “notification time” in respect of that particular proposed enterprise agreement. The MUA therefore submits that the evident statutory purpose of this new provision is limited to ensuring that protected action cannot be taken until after bargaining has commenced, and that bargaining did commence when the employer agreed to or initiated bargaining. The MUA submits that the purpose is not to ensure that protected action cannot be taken until after the parties have agreed on scope.

[12] MMA Offshore submits that the Commission should not be satisfied that the application has been validly made having regard to the new subsection 437(2A). The company submits that having regard to the definition of “notification time” for a proposed agreement, the MUA must prove that MMA Offshore has agreed to bargain for the proposed agreement the subject of the application. It notes that the MUA’s application identifies a proposed agreement with a scope that is defined by two existing enterprise agreements and purports to rely on alleged bargaining activities in the period since approximately October 2015 in support of its application. MMA Offshore submits that its proposed agreement, as is clear from the terms of the notices of employee representational rights issued on around 14 October 2015, has a scope that is different to the scope of the proposed agreement identified by the MUA in this application, and that no evidence was presented in support of the contention that MMA Offshore agreed to bargain for the MUA’s proposed agreement the subject of this application. It submits therefore that there has been no notification time in relation to that proposed agreement.

[13] A recent Full Bench considered a similar factual scenario. 1 After tracing the recent legislative amendments the Full Bench said:

“[41] As reflected in the Explanatory Memorandum, s.437(2A) implements the first aspect of recommendation 31.The Note clarifies that bargaining can be taken to have commenced for the purpose of s.437(2A), even where the scope of the proposed enterprise agreement is the only matter in dispute. To that extent the Note relates to the second part of recommendation 31, although as we earlier observed the Note is not part of the FW Act. It follows that if bargaining can begin with an employer proposing a broadly scoped agreement and when scope is in dispute, a bargaining representative proposing a more narrowly scoped agreement may apply for a protected action ballot order in relation to that proposed agreement.”

[14] The Full Bench then found the following in relation to the facts in that matter:

“[49] It is common ground that the October 2015 NERR is a valid NERR. In our view the NERR is evidence of the agreement by Maersk to bargain for an agreement with respect to employees to whom the notice relates. There is no evidence to the contrary. As we have mentioned, the October 2015 NERR was given to employees who would be covered by the enterprise agreement described in the notice (Maersk’s proposed agreement). Maersk’s proposed agreement covers employees covered by three unions – the MUA, the AIMPE and the AMOU. The scope of the MUA’s proposed enterprise agreement is narrower – it is an ‘MUA only’ enterprise agreement’. Contrary to Maersk’s submission, we are satisfied that the October 2015 NERR is a valid NERR for the purpose of the MUA’s proposed enterprise agreement. This is so because the scope of the MUA’s proposed enterprise agreement falls within the scope of the Maersk proposed enterprise agreement. Different considerations would arise if the scope of the MUA’s proposed enterprise agreement had been wider than the Maersk proposed agreement, but that is not the case. We do not propose to express a view about alternative factual scenarios in the absence of full argument about such matters. In the circumstances before us the facts of this matter do not appear to present an impediment to the present application.”

[15] MMA Offshore has agreed to bargain in relation to a “one fleet” enterprise agreement. The scope of the proposed MUA agreement is a subset of MMA Offshore’s proposed scope. Applying the Full Bench decision in Maersk, I find that there is a notification time in relation to the MUA agreement because MMA Offshore has agreed to bargain for an agreement covering the relevant employees. The first jurisdictional objection raised by MMA Offshore should be rejected.

Requirements for Protected Industrial Action

[16] MMA Offshore submits, in the alternative, that the requirements for industrial action to be “protected industrial action” for a proposed agreement under s.408 of the Act will not be satisfied, and that therefore the MUA’s application was not validly made. This argument repeats an argument unsuccessfully advanced before Barker J of the Federal Court. The contention is that the MUA contravened the interim orders made by Commissioner Cloghan in July 2014, and is therefore unable to take protected industrial action in support of a proposed agreement to replace the 2010 General enterprise agreement. A Full Court appeal is pending in relation to the decision of Barker J.

[17] I do not consider that this matter has a bearing on the validity of the application made by the MUA, or that this is a proper issue for consideration in relation to the application. I reject this contention of MMA Offshore.

Genuinely Trying to Reach Agreement

[18] MMA Offshore submits that, in the event the Commission finds that the application has been validly made, then the Commission cannot be satisfied that the MUA has been and is genuinely trying to reach agreement under the Act, in particular given the following aspects of the MUA’s conduct:

• conduct that is the subject of MMA Offshore’s good faith bargaining order application;



• failing to provide explanation of and justification of its changes in its bargaining position since September 2015;



• misrepresenting MMA Offshore’s bargaining position to employees and failing to correct that in a timely manner in October 2015;



• not being properly represented at a meeting on 28 October 2015;



• misrepresenting its true position concerning application of interim orders in around November 2015;



• failing to provide MMA Offshore with its complete proposal since around December 2015;



• pursuing claims for non-permitted matters or unlawful terms; and



• changing the purported scope of its proposed agreement in around December 2015.

[19] The MUA led evidence aimed at establishing that it has been, and is, genuinely trying to reach agreement with MMA Offshore. It submits that the evidence establishes that since the company wrote to the union on 22 September 2015 to recommence bargaining, the MUA has been putting forward its own proposals and draft enterprise agreements, and also engaging with MMA Offshore in respect of its proposals and draft enterprise agreements. It submits that this conduct is directed towards the purpose of reaching an agreement, and that MMA Offshore’s argument seeks to substitute the test in s.443(1)(b) with a question of whether the MUA is meeting the good faith bargaining requirements of the Act. The MUA submits that the test in s.443(1)(b) requires a holistic assessment of facts and circumstances and that to focus on specific factual circumstances in the context of a long period of bargaining is opportunistic and detracts attention from the actual endeavours of the MUA to reach agreement with the company.

[20] In JJ Richards & Sons Pty Ltd v Fair Work Australia 2Flick J said the following (prior to the amendments concerning notification time) about the tests in s.443 of the Act:

“55. The terms of s 443(1) impose only two express statutory constraints upon the mandatory obligation otherwise imposed upon Fair Work Australia to make a protected action ballot order: one constraint is that there must be an application made under s 437 (s 443(1)(a)); the other is that Fair Work Australia must be “... satisfied that each applicant has been, and is, genuinely trying to reach an agreement ...” (s 443(1)(b)).

56. It is not considered that any question arises of implying any further constraint into the operation of s 443(1) other than the two which have been expressly identified by the Legislature. Indeed, to attempt to do so would confront the difficulty of reading into a statutory provision words which are not there. Any such attempt would improperly propel the Court from its accepted role of interpreting the will of the Legislature into the territory of itself redrafting legislation.

57. The difficulty presented is to interpret the phrase employed in s 443(1)(b). Even in the absence of such further difficulties of construction as may be occasioned by the terms of ss 412 and 413, the content of s 443(1)(b) is perhaps not self-evident.

1. It is ultimately concluded that s 443(1)(b) is to be construed such that Fair Work Australia cannot reach a state of satisfaction that an “applicant ... is ... genuinely trying to reach an agreement with the employer” unless:

○ an applicant has approached the employer and informed the employer of the general ambit of that for which agreement is sought; and

○ the employer has foreshadowed – even in the most general of terms – its attitude as to the proposed agreement.

More may be required. Much may well depend upon the factual scenario in which the terms of s 443(1)(b) are to be applied. But such a minimum statement of that which is required is sufficient to dispose of the present Application. Contrary to the submissions advanced on behalf of the Applicants, the terms of s 443(1)(b) do not require:

● bargaining to have commenced within the meaning of and for the purposes of s 173, found within Part 2-4, of the Fair Work Act.

1. So much, it is concluded, follows from the natural and ordinary meaning of the phrase “trying to reach an agreement ...”. It is difficult to conclude that any person can try to reach an agreement with another in the absence of a disclosure of that for which consensus is sought. One person may wish to reach an agreement with another. But, until the general content of the proposed agreement is disclosed, it cannot be said that he has even attempted to reach an agreement. Until disclosed, it is not known whether the other person will readily embrace the proposed agreement or shun it or (perhaps) embrace the concept of an agreement but wish to vary one or other of its terms. Until disclosed, the person seeking agreement has not even tried to solicit the response of the other. Unless the disclosure is genuinely with a view to reaching agreement, it could well be said that the attempt to reach an agreement falls short of a person even trying to reach agreement. The addition of the word “genuine” – on one approach to construction – perhaps adds little. But the addition of that term serves to emphasise the importance of a person actually trying to solicit agreement. Until a proposed agreement has been disclosed to the prospective parties, and a response solicited, an applicant has not even tried to reach agreement – let alone genuinely tried to reach agreement.”

[21] The approach to this question requires a consideration of the evidence in relation to the representations and bargaining between the parties and a finding of fact in relation to the legislative test. I have considered all of the evidence in this matter but I do not propose to summarise it in this decision beyond the summaries provided by the parties above. I find on the evidence as follows:

• From around December 2012 MMA Offshore has been negotiating with the MUA for an enterprise agreement to replace the two expired agreements referred to in paragraph [1] above,



• On 22 September 2015 the AMMA wrote to the MUA, and other unions, advising the intention of MMA Offshore to put an enterprise agreement to a vote of its offshore employees,



• Various correspondence was exchanged between the AMMA and the MUA over subsequent months. In that correspondence the parties exchanged draft enterprise agreements, the last of which was a draft provided by the MUA on 14 January 2016,



• Meetings were held between representatives of MMA Offshore and the MUA on 6, 7 and 28 October, and 18 November 2015.

[22] There is no doubt that the negotiations between the parties have been long and tortuous. Various proceedings in the Commission and the Court have fashioned the conduct of the parties to an extent. The history has included previous litigation about the genuineness of the MUA in trying to reach an agreement and allegations of taking positions for extraneous purposes. The parties remain apart on a large number of matters including the scope of any agreement. The positions of other unions and other employers in the industry are part of the context of the negotiations. The content of the negotiations is confused and confusing.

[23] The MUA campaigned against a positive vote for the agreement proposed by MMA Offshore in October 2015. It subsequently proposed its own agreement and has revised its position in certain respects. It has attempted to navigate around the outcomes of various proceedings and pending cases. Negotiations have been fraught and difficult. Agreements or understandings that have been made during the process may well have been modified. There may well be grounds for the parties to criticise each other over their respective positions. Certain claims by the MUA may not be about permitted matters under s.172(1) of the Act.

[24] In all of the circumstances I am satisfied that the MUA has been genuinely trying to reach an agreement with MMA Offshore and continues to do so. The efforts that it has made in relation to the negotiations appear to me to be exclusively directed to that objective. That is not to say that elements of its conduct cannot be subject to legitimate criticism. I am satisfied that the MUA has established the prerequisite for a protected action ballot order in s.443(1)(b).

Extension of the Notice Period

[25] MMA Offshore requests that if the Commission is inclined to make the order that it should extend the notice period required under s.414 of the Act to the period of 7 calendar days. It led evidence from the Fleet Operations Manager of MMA Offshore, Barry Jewson in relation to these matters. Mr Jewson was not cross-examined. I accept his evidence and find that there are exceptional circumstances justifying a longer period of notice than provided in s.414(2)(a). I will extend the notice period to 7 calendar days in the order I make in this matter.

Conclusion

[26] I reject the arguments advance by MMA Offshore against the making of a protected action ballot order for the reasons stated above. The order I issue in conjunction with this decision will amend the notice period for protected industrial action in s.414 of the Act.

VICE PRESIDENT

Appearances:

Mr R. Hooker, of counsel, on behalf of the MUA.

Mr D. Parker, of counsel, on behalf of MMA Offshore.

Hearing details:

2016.

Perth.

22 January, 8 and 17 February.

Final written submissions:

The MUA on 4 March, and 8 April 2016.

MMA Offshore on 24 February, 17 March, and 15 April 2016.

 1   Maritime Union of Australia v Maersk Crewing Australia Pty Ltd[2016] FWCFB 1894.

 2 [2012] FCAFC 53.

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