National Union of Workers (NUW), Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) and Automotive, Food, Metals, Engineering, Printing and...

[2016] FWC 6262

[2016] FWC 6262

FAIR WORK COMMISSION

REASONS FOR DECISION

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

National Union of Workers (NUW), Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) and “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU)
v
Sakata Rice Snacks Australia Pty Ltd
(B2016/903), B2016/905 and B2016/912)

DEPUTY PRESIDENT GOSTENCNIK MELBOURNE, 12 SEPTEMBER 2016

Proposed protected action ballot of employees of Sakata Rice Snacks Australia Pty Ltd

[1] On 1 September 2016, I made protected action ballot orders in respect of applications made by the National Union of Workers (NUW), the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers’ Union (AMWU) and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) (collectively “the Unions”). In so doing, I indicated that I will publish my reasons for the decision to make the orders in due course. These are my reasons for that decision.

[2] Various employees of Sakata Rice Snacks Australia Pty Ltd (Sakata) are covered in their employment with Sakata by the Sakata Rice Snacks Australia Pty Ltd Agreement 2013-2016 (Agreement), the nominal expiry date of which, namely 8 June 2016, has passed. The AMWU and the NUW are covered by the Agreement.

[3] In early March 2016, the NUW, the CEPU and Sakata commenced bargaining for a proposed enterprise agreement. The AMWU joined in the bargaining at a later stage, although for the most part, it was represented at the bargaining meetings by delegates of the union rather than by officials. Each of the NUW, the AMWU and the CEPU is a bargaining representative for the proposed agreement.

[4] It is not in contest thatsince bargaining commenced there have been a number of bargaining meetings through the period of March 2016 to August 2016 and each of the NUW, the AMWU and the CEPU have clearly outlined the claims that they make in respect of a proposed agreement. Likewise, it is not in contest that Sakata has advanced particular claims or positions; that it has sought approval of employees of a proposed agreement and that as matters presently stand there remain a number of outstanding issues or claims.
[5] By applications lodged on 23 August 2016, in the case of the NUW and the CEPU, and on 24 August 2016 in the case of the AMWU, each union has applied for a protected action ballot order (PABO) pursuant to s.437 of the Act. Sakata neither opposes nor consents to the making of orders but it has raised matters which it says are relevant to determining whether each of the Unions has been and is genuinely trying to reach agreement with it.

Consideration

[6] Ms Nicole Hesketh, the Human Resources Manager of Sakata, made a statutory declaration and gave evidence about the course of bargaining. The import of her evidence was that the Unions have made and continue to maintain claims in respect of contractors which are claims for non-permitted matters.

[7] Statutory declarations were filed and served by each of the Unions in support of their applications. Mr Adam Auld of the NUW filed a statutory declaration dated 29 August 2016 and was called to give evidence during the hearing. Mr Auld’s evidence was that a log of claims was served by the NUW on Sakata on or about 18 April 2016 and that since this date, there have been no less than eight meetings held between the Unions and Sakata for the purpose of negotiating the terms of the proposed enterprise agreement.

[8] Mr Auld’s evidence was that at about the fifth meeting, Sakata ceased negotiations and put a proposed agreement to vote to employees who will be covered by it. The proposed agreement was not approved and bargaining thereafter continued. He said that throughout negotiations the NUW has changed its bargaining position, including amending and withdrawing claims.

[9] Mr Auld said that the first time he became aware that Sakata held the view that the Unions’ claims included non-permitted matters was after Sakata raised the issue on 25 August 2016 in relation to these applications. He said that, during the first seven meetings, Sakata did not advise the Unions that it believed the Unions’ claims included non-permitted matters.

[10] The AMWU relied on the statutory declarations dated 24 August 2016 and 29 August 2016 made by Ms Kimberley Johnston, an official of the AMWU in support of its application. Ms Johnston was not cross-examined. Ms Johnston’s evidence was that there was a notification time on or about 15 April 2016. Ms Johnston’s evidence is that the AMWU adopted the log of claims sought by the NUW and communicated to Sakata, and that the AMWU had advanced one additional wages claim. Ms Johnston said that the AMWU has been, and is, genuinely trying to negotiate the terms of an enterprise agreement with Sakata, and that the AMWU remains willing to meet with Sakata to continue negotiating its claims for the purpose of reaching an agreement.

[11] The CEPU relied on an amended statutory declaration of Mr Gerry Glover, Branch Organiser of 24 August 2016. Mr Glover was not cross-examined and his evidence was that bargaining meetings with Sakata had taken place on eight occasions including:

• 7 March 2016;



• 18 April 2016;



• 9 May 2016;



• 25 May 2016;



• 7 June 2016;



• 14 June 2016;



• 8 August 2016; and



• 22 August 2016.

[12] Mr Glover has attended some of these meetings. He declared that the CEPU has been, and is, genuinely trying to negotiate the terms of a proposed enterprise agreement with Sakata. He also says that the CEPU remains willing to meet with Sakata to continue the negotiations of its claims for the purpose of reaching agreement.

[13] Ms Hesketh’s evidence was that she has been involved in all negotiation meetings with the Unions and that the first meeting was held with two of the Unions on 7 March 2016. The AMWU was not present at this initial meeting and Ms Hesketh indicated that the AMWU attended only one meeting on 18 April 2016, although she noted that the AMWU had been represented by its delegates at other meetings.

[14] Ms Hesketh’s evidence was that Sakata tabled a log of claims at the meeting on 7 March 2016. Following this, a log of claims, was lodged by the NUW on 15 April 2016.

[15] Ms Hesketh said that, at the meeting on 18 April 2016, the NUW raised a claim to provide labour hire workers with security and fair treatment. She said that Sakata has maintained throughout negotiations that labour hire employees would not be covered by the proposed agreement as they are not employees of Sakata and there was no direct relationship between such workers and Sakata.

[16] Ms Hesketh conceded that the Sakata had not put to the Unions that it believed that the claims made by the Unions concerning labour hire workers or contractors were non-permitted matters. That evidence is set out below:

“What are the specific labour hire claims that you have concerns with in relation to whether they are permissible or not, or contain not permitted matters or not?---So the claims that we've just spoken through, so the mass - the labour hire being able to attend the union mass meetings, for Sakata employee delegates to represent labour hire workers at disciplinary meetings and also our delegates attending inductions with labour hire workers.

So I put it to you, broadly then, Ms Hesketh, they are the union inductions claim, the union paid union meetings claim and the disciplinary procedure claim.  Would that be a fair way to characterise those concerns?---Correct.

Are they the only items that you have concerns with in relation to permitted status or not?---They'd be the key ones, yes.

Are they the only ones that you have concerns with?---Well, the third one - the fourth one sorry, would be around labour hire conversion.

Labour hire conversion?---Yes.

Ms Hesketh, I take you to exhibit 3, the minutes.  If Ms Hesketh can be provided with a copy?  And I'll take you to the same page that I took Mr Auld to, which is on the bottom of the fourth page, which is Mr Nestor's response, on behalf of the company, in relation to the labour hire conversion claim where he says, "There is some validity in this", etc.  Does that accord with your recollection of the meeting?---I wasn't present at this meeting.

Okay.  How many meetings weren't you present?---Just those two, during May, the 9th and the 25th, I was on annual leave.

So, are you aware of what occurred during all those meetings?---Yes, I'm aware.

So, you're aware that Mr Nestor, on behalf of the company, indicated the company saw validity in the labour hire conversion claim?---Yes.  But validity in terms of some of our - some labour hire workers who had been working on site for a number of years, yes.

Okay.  Can you point to me where, in those minutes, Mr Nestor, or anyone else on behalf of the company, disputed the permitted status of that claim?---Of the conversion claim specifically?

Yes?---I can't see anywhere.  I put it to you that there's nowhere in these minutes where such a dispute or such a position is put to the union.  Would you agree with that?---In this particular meeting, no.

So, in what particular meeting would you say that you actively disputed the permitted status of that particular claim, the conversion claim?---Throughout all of the meetings that I've been present in, the company has continuously stated that labour hire workers are not direct employees of Sakata and therefore, not currently covered by the enterprise agreement.

Ms Hesketh, that's not my question.  My question is not whether or not you put to the unions that labour hire workers are not your employees.  My question is, at what stage, if any, did you dispute the permitted status of that particular claim, around labour hire conversion?---Sorry, I'm not quite clear.  So, can you repeat your question, please?

Did you ever question the permitted status of the labour hire conversion claim of the union?---Not specifically, in terms of whether it's a non-permitted matter, no.

Okay.  Did you ever advise the NUW, or the other unions for that matter, that it is your belief that any of the other specific labour hire claims may be, or may contain, non-permitted matters?---Not in that terminology, no.

So you never, at any stage, advised any of the unions your belief, or the company's belief, that any of these labour hire claims may contain non-permitted matters?---We never used the term, "non-permitted matters", no.  We did continuously refer to our lack of understanding as to how these were benefiting our Sakata employees and the fact that they were not - labour hire are not our direct employees, therefore again, not employees of Sakata and therefore not covered by the enterprise agreement.

But you never put to the company that these claims were for non-permitted matters and weren't allowable, for want of a better term?---Not in that terminology, no.” 1

[17] This is consistent with the evidence given by Mr Auld to the effect that at no time during the bargaining meetings did Sakata advise him that it believed that the Unions’ claims included non-permitted matters. 2

[18] It seems clear from the evidence given by Mr Auld, which I accept, that the claims being pursued by the Unions insofar as they related to labour hire workers were being pursued in order to advance the security of employment of employees of Sakata who would be covered by the proposed agreement. This belief is encapsulated by the following evidence given by Mr Auld:

“So, Mr Auld, why was the union pursuing these claims, these three claims specifically?---So, Pepsico currently engage workers directly and they also engage quite a number of workers indirectly through a labour hire provider, Chandler Macleod, and the members themselves, so the direct workers for Pepsico, pursued these claims.  And when we surveyed our members, they felt that this was quite an important matter.  And when I say "important matter" to them, they felt it was about their job security, working at Pepsico.  And I suppose there, their concerned that when there's a group of workers being employed in their place of work, that are possibly being undercut and the conditions aren't similar, they feel that their job security is at risk.  Hence them pursuing this as a claim.

Mr Auld, so these three specific labour hire claims, do these three claims still form part of the union's claims?---No, they don't.  Those claims have been withdrawn.” 3

[19] By email of 31 August 2016 the NUW advised Sakata, inter-alia, as follows:

“In addition, in an effort to reach agreement with the company, we are willing to withdraw those items relating specifically to inductions, paid union meetings and disciplinary procedure for labour hire workers, and instead, seek an “employment security” clause directed to ensuring that labour hire workers do not undercut the terms and conditions of directly employed Sakata employees.” 4

[20] Each of the AMWU and the CEPU support adopt the position advanced by the NUW in its email of 31 August 2016. 5

[21] It is evident from the above that the Unions were pursuing claims in bargaining relating to labour hire workers which were being advanced with a view to ensuring the security of directly employed employees who would be covered by the proposed agreement, that Sakata did not put into issue directly that it believed those claims were non-permitted matters until after the applications the subject of these proceedings were made and that before or at the hearing of those applications the Unions withdrew those claims.

[22] Moreover, on the face of the claims pertaining to labour hire workers they are not clearly or unambiguously non-permitted matters.

[23] Section 437 enables a bargaining representative to apply for a PABO. Section 437(1) provides:

“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 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.”

[24] Excepting the restriction on making an application in ss.437(2A) and 438(1), the Commission must make a PABO in relation to employees who will be covered by a proposed agreement in the circumstances set out in s.443. There is no contest that the restrictions do not apply in the instant case. Section 443 relevantly provides:

“443 When FWC must make a protected action ballot order

(1) 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) 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.

(2) 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).”

[25] The concept of genuinely trying to reach an agreement involves a finding of fact applied by reference to the circumstances of the particular bargaining. It is not useful to formulate any alternative test or criteria for applying the statutory test because it is the words of s.443 which must be applied. In the course of examining all of the circumstances, it may be relevant to consider related matters but ultimately the test in s.443 must be applied. Neither is it appropriate, nor possible to establish rigid rules for the required point of bargaining that must be reached. All of the relevant circumstances must be considered in assessing whether an applicant for a PABO has met the test in s.443 of the Act. This will frequently involve considering the extent of progress in negotiations, and the steps taken in order to try and reach an agreement. 6 

[26] Where it is suggested that there has been a failure to meet good faith bargaining requirements, it must be borne in mind that although there is a relationship between the good faith bargaining requirements and the concept of genuinely trying to reach an agreement, it would be wrong to conflate these terms. An applicant for a PABO may not meet a particular good faith bargaining requirement, but may nevertheless be genuinely trying to reach an agreement. 7

[27] There is no suggestion on the evidence that with the exception of the non-permitted matters allegation, the Unions have not otherwise been or otherwise are not genuinely trying to reach an agreement with Sakata. As a Full Bench of the Commission made clear in Esso Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers' Union (AMWU); Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU); The Australian Workers' Union (AWU), 8that a bargaining representative is advancing claims for a non-permitted matter does not in and of itself mean that the bargaining representative has not been and is not genuinely trying to reach an agreement, rather the pursuit of claims for a non-permitted matter is a consideration to be taken into account in the overall assessment of the factual circumstances.9

[28] As I have observed earlier, the claims earlier sought to be advanced by the Unions are not clearly non-permitted matters. That they were or might have been non-permitted matters was not directly put in issue by Sakata until after the applications the subject of this proceeding were made. Thereafter, the Unions promptly withdrew those claims. In these circumstances and having regard to the totality of the evidence to which earlier reference was made it seems to me clear enough that each of the Unions has been and is genuinely trying to reach an agreement with Sakata. 10 The prospect that some of the Unions’ claims which have since been abandoned might have concerned non-permitted matters does not, in the circumstances of this case, lead to a contrary conclusion.

Conclusion

[29] I am satisfied that each of the NUW, the AMWU and the CEPU, as a bargaining representative for the proposed agreement and applicant for a PABO, has been and is genuinely trying to reach agreement with Sakata. I am also satisfied that neither restriction on making an application in ss.437(2A) and 438(1) operates to prevent the applications. I am satisfied and it was not in contest that the other statutory criteria have been met.

[30] A protected action ballot order in each case has be made and separately issued in PR584940, PR584942 and PR584671.

DEPUTY PRESIDENT

Appearances:

Mr A Portelli for the National Union of Workers

Ms L Weber for the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia

Ms K. Johnston for the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU)

Mr M Rodgers of Livingstones on behalf of Sakata Rice Snacks Australia Pty Ltd

Hearing details:

DEPUTY PRESIDENT

Appearances:

Hearing details:

Final written submissions:

 1   Transcript PN278 – PN294.

 2 Exhibit 2 at [8].

 3   Transcript PN69 – PN70.

 4   Exhibit 1.

 5   Transcript PN413 – PN418.

 6   Total Marine Services Pty Ltd v Maritime Union of Australia[2009] FWAFB 368; (2009) 189 IR 407 at [32]-[33]; Esso Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers' Union (AMWU); Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU); The Australian Workers' Union (AWU)[2015] FWCFB 210 at [34]-[35].

 7   See the decisions of Gostencnik DP in NUW v Riverland Oilseeds Pty Ltd [2013] FWC 5914 at [17]-[ 19]; Hamberger SDP in TWU v CRTGroup Pty Ltd[2009] FWA 425 at [26], and Lewin C in NUW v SKF Australia Pty Ltd[2010] FWA 6557 at [19] - [21]; endorsed by a Full Bench of the Commission in Esso Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers' Union (AMWU); Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU); The Australian Workers' Union (AWU)[2015] FWCFB 210 at [18].

 8   [2015] FWCFB 210.

 9   Ibid at [34] – [35], [59].

 10 Ibid at [75].

Printed by authority of the Commonwealth Government Printer

<Price code A, PR584945>