National Union of Workers v Defries Industries Pty Ltd
[2009] FWA 88
•18 AUGUST 2009
[2009] FWA 88 |
|
DECISION |
Fair Work Act 2009
s.229 - Application for a bargaining order
v
Defries Industries Pty Ltd
(B2009/10439)
COMMISSIONER WHELAN | MELBOURNE, 18 AUGUST 2009 |
Section 229 application for bargaining orders.
[1] This matter concerns an application by the National Union of Workers (NUW) for bargaining orders against Defries Industries Pty Ltd. An application has also been made by the union under section 238 for scope orders. That matter has been adjourned and will be relisted on notification by the parties.
[2] Evidence in the proceedings was given by Mr Cole, an organiser for the NUW and Mr Poxon, Operations Manager for the company.
Background
[3] On 7 July 2009 the NUW, on behalf of their members, served a log of claims on Defries Industries. The union sought to have the claims included in an enterprise agreement pursuant to section 172 of the Fair Work Act 2009.
[4] On 15 July Mr Cole rang Mr Poxon and asked to meet with the company to discuss the log of claims. Mr Poxon agreed to meet with the NUW on 20 July 2009.
[5] On 17 July the company circulated to employees a document titled ‘Defries Enterprise Agreement (2009)’. Accompanying that document was a memorandum to all staff which stated, amongst other things, that questions about the agreement should be forwarded to either Mr Poxon or ‘Cindy’ by Friday 24 July 2009:
A simple Q & A document will then be prepared and circulated to all staff. Once we have finalised the terms of the enterprise agreement, we will proceed to a vote. At this stage, we anticipate that the vote will be held on Tuesday 11 August 2009.
[6] Accompanying the memorandum was a ‘Notice of employee representational rights’.
[7] The draft agreement, but not the accompanying documents, was provided to Mr Cole by union members at Defries.
[8] On 20 July 2009 Mr Cole, along with Mr Melling from the NUW and the NUW delegates, Ms Ramos and Ms Obucina met with Mr Poxon, Mr Allan Jago, the Manufacturing Manager and Ms Tu, the Accounts Manager. The evidence given by Mr Coles and Mr Poxon about that meeting is substantially different.
[9] Mr Cole’s evidence was that the union expressed concerns about the scope and content of the draft Defries Agreement and sought to discuss the union’s logs of claims. Mr Poxon stated that he did not wish to discuss the log and suggested that the union provide him with a draft document. The union agreed to provide a draft agreement to the company. The union sought an undertaking that the company would not put an Agreement to a vote of employees before both parties agreed. Mr Poxon gave this commitment. The meeting lasted about 10 minutes. They agreed to meet again on 24 July 2009.
[10] Mr Poxon’s version of the events is that he offered Mr Cole a copy of the Defries draft. Mr Cole said he already had a copy. He asked Mr Cole to provide draft clauses that reflected the items in the NUW’s log of claims. Mr Cole said that he would send a draft agreement. He offered to send Mr Cole an electronic version of the Defries draft agreement. Mr Cole said he did not want one. Mr Cole asked if Defries would consider adjourning the vote scheduled for 11 August 3009. He said that Defries would only adjourn the vote if the feedback from the workforce indicated that an adjournment was necessary. Mr Cole agreed to adjourn the meeting until 24 July 2009.
[11] Mr Cole stated that Mr Poxon’s statements about offering an electronic copy of the Defries agreement and his response to that, and his statement about the company’s response to the NUW’s request that the company not put the Agreement to a vote were both untrue.
[12] On 21 July 2009 the NUW emailed a proposed draft agreement to Mr Poxon.
[13] Mr Poxon stated that he became confused after reading the NUW’s draft agreement and created a spreadsheet which showed:
- Which log of claims items has been met by the Defries draft enterprise agreement;
- Which NUW clauses were relevant to the log of claims;
- Which log of claims items were non-negotiable as contained in the NUW draft agreement;
- Which log of claims items were negotiable as contained in the NUW draft agreement.
[14] On 23 July 2009 the NUW met with its members at Defries. They circulated a flyer to employees which drew attention to seven items in the Defries draft agreement which they stated would remove existing award conditions.
[15] On 24 July 2009 Mr Cole along with three NUW delegates, Ms Ramos, Ms Obucina and Ms Delbridge met with Mr Poxon, Mr Jago and Ms Tu. There was some initial discussion of other issues and the content of the NUW flyer. Mr Cole sought to go through the NUW draft agreement provided to the company on 21 July 2009. Mr Poxon said that he did not want to do that and stated that he wanted the union to put the clauses the NUW wanted as amendments to the Defries draft agreement. Mr Cole asked if he could provide the Union with an electronic version of the Defries draft and he agreed to send it to him. The meeting lasted about 15 minutes.
[16] Following that meeting Mr Cole either phoned or emailed Mr Poxon on 29 July because the Union had not received the electronic version of the Defries draft. Mr Poxon agreed to provide the document by close of business the following day.
[17] On 27 July 2009 Mr Poxon and Ms Tu met with employees on the site to discuss issues raised by them in relation to the Defries draft. The document he provided to Mr Cole on the afternoon of 30 July contained some amendments which he said arose from feedback from staff and items in the NUW’s flyer of 23 July.
[18] The covering email stated, “Revised version of the agreement attached, please review and advise your suggested amendments so we can consider any changes we need to make”.
[19] On 31 July Mr Cole arranged to meet with Mr Melling on 3 August to draft a response to Defries. He forwarded the Defries document to Mr Melling who discovered that it was in PDF format and could not be amended. On Tuesday 3 August NUW delegates reported to Mr Cole that the document he had received on 30 July had been distributed to employees who were advised that there would be a vote taken on 11 August 2009.
[20] On 4 August 2009 the NUW sent Mr Poxon a letter stating that they did not believe that the company was bargaining in good faith.
[21] In his evidence Mr Cole stated that the company had never responded to either the union’s log of claims or the draft agreement provided. He assumed after the meeting on 20 July 2009 that the company would not put an agreement to a vote until negotiations had concluded. He agreed that there were probably things in the company’s draft which did address certain things in the log of claims. The union had done what the company has asked it to do in providing a draft agreement and in agreeing to provide amendments to the company’s agreement. The union was trying to get the company to negotiate. At no time did Mr Poxon point out where he thought the Defries agreement met the log of claims or indicate which matters were negotiable and which were non-negotiable.
[22] Mr Poxon in his evidence stated that he was confused by the union’s log of claims but did not think to ask the union questions about it at the meeting on 20 July 2009. He gave evidence of two changes to the Defries document which he stated were changes arising out of the NUW’s draft.
[23] He did not distribute the document to the NUW on 3 August 2009 because he assumed they would get a copy via their people. Mr Poxon was unable to identify the items in the NUW draft which were inconsistent with their log of claims. He did not discuss with the NUW any of those issues nor did he discuss with them which items in the log he believes that Defries had addressed in their agreement or which claims were negotiable or which were non-negotiable.
[24] Mr Poxon stated that the NUW never came back to the company to say what was wrong with their draft. He did not contact the NUW to ask for feedback. He agreed that the union effectively had one day to respond to the draft. When it was put to him that it was clear that the NUW had a number of issues with the agreement he stated that it was not put in writing. He agreed that he did not discuss the union’s log of claims.
Submissions
[25] Ms Allison, for the NUW, submitted that the Fair Work Australia (FWA) had power to make a bargaining order because an application had been made (section 230(1)(a)), the requirements of the section had been met and the employer had agreed to bargain or had initiated bargaining for an agreement (section 230(2)(a)). FWA must be satisfied that one or more of the relevant bargaining representatives was not meeting the good faith bargaining requirement.
[26] The good faith bargaining requirements are set out in section 228. Ms Allison submitted that the employer had not met the requirements of section 228(1)(a). The requirement to attend and participate in meetings at reasonable times is not just a ‘tick the box’ exercise. The provisions require participation in bargaining. It is about there being adequate meetings and adequate participation. In some cases, one or two meetings might be enough to go through the matters in dispute. In this case both parties have produced extensive draft agreements. Two meetings totalling 25 minutes are not adequate to do justice to the issues. In the two meetings no matters of substance were discussed, rather the employer used the meetings to seek additional documentation from the NUW. There was no discussion of the claims put by the union.
[27] Section 228(1)(b) requires that the parties disclose relevant information. The respondent has failed to meet this requirement. On 3 August 2009 the respondent distributed a draft company agreement to all employees and advised them that a vote would go ahead on 11 August. The company did not inform the union. The parties were engaged in discussion and it was reasonable for the NUW to conclude that any vote that had been adjourned until those discussions had reached their natural outcome. The NUW is the legal and legitimate bargaining representative for employees and the company has an obligation to discuss matters with the relevant bargaining representative.
[28] Section 228(1)(c) and (d) require a bargaining representative to respond to proposals made by other bargaining representatives and to give genuine consideration to the proposal of other bargaining representatives. The respondent has not responded to the union’s log of claims and nor has it given it genuine consideration. The respondent says that it believed that its agreement did meet some of the requirements of the union’s log, there were some negotiable matters and some non-negotiable ones but this was never communicated to the NUW. On 24 July the NUW provided the respondent with a draft agreement. The respondent did not consider the NUW draft.
[29] The respondent requested the NUW to incorporate any amendments it sought into the company’s draft agreement. On 30 July 2009 the union received an electronic copy of the agreement.
[30] Mr Cole and Mr Melling were to discuss that document on 3 August 2009 in order to respond within a reasonable time but the company on that day put the document to employees without seeking any comments or amendments from the NUW.
[31] Section 228(1)(e) refers to capricious or unfair conduct. The NUW relies first on the company’s actions in circulating the agreement for a vote before discussions with the NUW. This denied union members the right to have their views on the document raised. The second issue is the scope of the proposed company agreement which covers, in addition to employees covered by the Storage Services General Award, employees with very different terms and conditions of employment in distinct operational and geographical locations and includes managers.
[32] In relation to section 229(4) Ms Allison referred to the letter sent by Mr Curnow to the company on 4 August 2009 stating that the union did not believe that the company were bargaining in good faith. In the alternative, the union relies on section 229(5) and referred to the tight time frame within which the union needed to act given the impending vote. In support of that submission Ms Allison referred to the decision of Richards SDP in ASU v Queensland Tertiary Admissions Centre Ltd 1 and to the Explanatory Memorandum to the Fair Work Bill at [957].
[33] Mr Wong, for the respondent, submitted that the respondent was seeking to negotiate an enterprise agreement with its employees. The NUW is a bargaining representative which represents some of those employees. Discussions have taken place and meetings have occurred, documents have been exchanged and some concessions have been made by the employer regarding the proposed agreement. The NUW does not have any ownership over the agreement.
[34] In relation to the requirements of section 229(4), Mr Wong submitted that the letter of Mr Curnow of 4 August 2009 did not meet the requirements of providing the employer with written notice setting out its concerns that the employer was not meeting the good faith bargaining requirements and nor was the employer given a reasonable time to respond to those concerns. It is not sufficient to say that Defries is not bargaining in good faith. The letter simply refers to issues concerning the scope of the agreement and the fact that the draft agreement was distributed to employees on 3 August 2009.
[35] Ms Allison submitted that that action amounted to a breach of section 228(1)(c). Mr Wong drew FWA’s attention to what the Explanatory Memorandum gives at [951] as examples of conduct which would amount to a breach of section 228(1)(e). The employer’s actions do not fall within those examples.
[36] Mr Wong also referred to the requirements of section 180(2) of the Act which deal with the employer’s obligation to provide employees with a copy of the agreement seven days before a vote is taken. There is no requirement under that section to provide the agreement to the bargaining representatives. The employer is not required to notify the relevant representatives until an application for approval of the agreement is made.
[37] In any case, Mr Wong submitted the document was provided to the NUW on 30 July 2009. Second, Mr Wong submitted that the respondent was not given a reasonable time to respond to the union’s concerns.
[38] In relation to the application of section 229(5) Mr Wong submitted that there was no reason for any immediacy in this matter because he had written to the NUW on 7 August proposing to adjourn the scheduled vote on 11 August 2009 pending resolution of the matters lodged by the union with FWA. The NUW responded that they wished to proceed with their application.
[39] In relation to the matters contained in section 228, Mr Wong submitted that the company had agreed to meet with Mr Cole on 20 July and Mr Cole did not press on Mr Poxon any other outcome from that meeting. Further he met again with Mr Cole on 24 July after giving the NUW an opportunity to meet with the employees.
[40] In relation to the allegation that the respondent has failed to disclose relevant information in a timely manner, Mr Wong submitted that the circulation of the employer’s draft to employees on 3 August 2009 was not a breach of good faith bargaining requirements. From at least 20 July, the NUW were aware that the respondent proposed for its employees to vote on the draft agreement.
[41] In relation to section 228(1(c) and (d) Mr Wong submitted that the respondent received and considered the union’s log of claims. Whether one version of the agreement is used or another is not a relevant consideration for good faith bargaining requirements. The NUW did not move from their position. They still pushed for their version of the agreement. Some of the issues were discussed on 24 July 2009.
[42] Mr Wong submitted that the company in circulating the Agreement on 3 August 2009 was not in breach of section 228(1)(e). If Parliament had intended that as part of good faith bargaining requirements, a bargaining representative should be notified that an agreement was being circulated to the employees, it would have expressly done so as part of the requirements of section 180.
The evidence
[43] There is no doubt that the company in this matter was on notice prior to 17 July 2009 that the NUW wished to bargain with it on behalf of their members at Defries Industries. The agreement of Mr Poxon to meet with the union on 20 July 2009 to discuss the union’s log of claims indicated that the company did not challenge the union’s right to be a bargaining representative not did the company decline to bargain with the NUW.
[44] The purpose of the meeting on 20 July 2009 was to discuss the union’s claims. Mr Poxon’s evidence was that he did not understand the log of claims or did not know where it was coming from yet he raised no questions about the log of claims at the meeting on 20 July. He did not deny that he refused to deal with matters set out in the log at that meeting.
[45] Prior to the meeting in 24 July 2009 he prepared a spreadsheet comparing the union’s log with the agreement and identifying matters in the log which were negotiable and which were not, yet he did not discuss those matters with the NUW at that meeting.
[46] At two very short meetings Mr Poxon asked the NUW first, to resubmit their log in the form of draft clauses, which they did the next day and second, to resubmit their draft agreement as amendments to the company’s draft. At neither meeting did he respond to the union’s proposals or provide any reasons for rejecting those which the company rejected.
[47] At the meeting in 20 July 2009 Mr Poxon stated that he offered Mr Cole an electronic version of the Defries draft agreement which he refused. The issue of the union providing its proposals as amendments to the Defries draft agreement only arose at the meeting on 24 July. In response to that Mr Cole asked for an electronic copy of the document. It is unlikely that either Mr Poxon made the offer on 20 July or that Mr Cole refused it.
[48] I am also inclined to accept Mr Cole’s version of the outcome of the 20 July meeting. It is unlikely, in my view, that the union would have left that meeting without some assurance that the company was not going to proceed to put an agreement to its employees for a vote without negotiating the content of that agreement with the NUW as a recognised bargaining representative. The union’s actions following the meeting are also consistent with their belief that an agreement would not be put to a vote without the company bargaining with the NUW as a bargaining representative.
[49] The fact that the company did not put the revised document to the NUW until the afternoon of 30 July and gave no indication in the covering email of any deadline within which they expected a response is also consistent with an undertaking having been given that the agreement would not be put to the employees in a pre-emptive manner.
[50] A number of Mr Poxon’s responses to question suggest he was either disingenuous or naïve. The company was either avoiding negotiating the substance of the agreement with the NUW or was under the misapprehension that because the agreement was with their employees they did not have to bargain with the union as a legitimate bargaining representative of at least some of those employees.
[51] At no point in either of the two short meetings could it be said that bargaining occurred. While there was an exchange of information and both sides put their proposals, there was little or no discussion of the contents of those respective proposals.
Conclusions
[52] In this matter the NUW, as the bargaining representative for the union members employed by Defries Industries, has applied for bargaining order to be issued by FWA.
[53] Section 229(4) set out the prerequisites for making such an application:
Prerequisites for making an application
(4) The bargaining representative may only apply for the bargaining order if the bargaining representative:
(a) has concerns that:
(i) one or more of the bargaining representatives for the agreement have not met, or are not meeting, the good faith bargaining requirements; or
(ii) the bargaining process is not proceeding efficiently or fairly because there are multiple bargaining representatives for the agreement; and
(b) has given a written notice setting out those concerns to the relevant bargaining representatives; and
(c) has given the relevant bargaining representatives a reasonable time within which to respond to those concerns; and
(d) considers that the relevant bargaining representatives have not responded appropriately to those concerns.
[54] The applicant relies on section 229(4)(a)(i) and I will address those matters shortly. In relation to section 229(4)(b) it relies on a letter sent by Mr Curnow on 4 August 2009. That letter stated that the union had concerns that Defries Industries Pty Ltd was not bargaining in good faith. The letter referred to the scope of the company’s agreement and the distribution of that agreement on 3 August 2009 for a vote by employees on 11 August. The union sought a response from the respondent by close of business on 5 August 2009.
[55] The company responded in undated correspondence stating that it had met the good faith bargaining requirements of the Act.
[56] While the union’s letter of 4 August 2009 may have been light on detail it was clear that the union had concerns that the company was bargaining in good faith arising out of its action in distributing the proposed agreement to employees on 3 August.
[57] The union only gave a short period of time to the company to respond but in the context of:
(a) the impending vote on 11 August 2009; and
(b) the company’s response to the union
the short time frame is understandable.
[58] Even if the notice was inadequate, I am inclined to consider that in all the circumstances of the case it would be appropriate to consider the application.
[59] Fair Work Australia may only make a bargaining order if it is satisfied that a bargaining representative has not met, or is not meeting the good faith bargaining requirements set out in section 228.
[60] Section 228 provides:
228 Bargaining representatives must meet the good faith bargaining requirements
(1) The following are the good faith bargaining requirements that a bargaining representative for a proposed enterprise agreement must meet:
(a) attending, and participating in, meetings at reasonable times;
(b) disclosing relevant information (other than confidential or commercially sensitive information) in a timely manner;
(c) responding to proposals made by other bargaining representatives for the agreement in a timely manner;
(d) giving genuine consideration to the proposals of other bargaining representatives for the agreement, and giving reasons for the bargaining representative’s responses to those proposals;
(e) refraining from capricious or unfair conduct that undermines freedom of association or collective bargaining;
(f) recognising and bargaining with the other bargaining representatives for the agreement.
(2) The good faith bargaining requirements do not require:
(a) a bargaining representative to make concessions during bargaining for the agreement; or
(b) a bargaining representative to reach agreement on the terms that are to be included in the agreement.
[61] Section 228(1)(a) refers to attending and participating in meetings at reasonable times. In this case there were two meetings, both of short duration, at which it appears the employer declined to address the issues but sought additional information. At an early stage in the bargaining process such behaviour would be unexceptional.
[62] ‘Participation’ 2 in a meeting the purpose of which is to negotiate a proposed enterprise agreement however suggests a sharing of information and views and a willingness to discuss the matters about which the other bargaining representative wishes to bargain.
[63] If the intention of the employer was to distribute a document to employees for a vote on 3 August 2009, then to continue to decline to discuss the content of the union’s claim on 24 July and to set no further meeting for that purpose prior to 3 August, amounts to a failure to ‘participate’ in meetings at reasonable times.
[64] Section 228(1)(b) refers to disclosing relevant information in a timely manner. The reason for the disclosure of information is to allow the other bargaining representative(s) to give consideration to the bargaining representative’s position. In my view, the employer failed to provide relevant information on two occasions. First, prior to the meeting on 24 July 2009 Mr Poxon had prepared a document which included the company’s position on what matters in the NUW draft were ‘negotiable’ and what were ‘non-negotiable’. By failing to reveal the employer’s position, the NUW had no opportunity to consult its members on whether it should continue to pursue ‘non-negotiable’ matters or not or whether to narrow the agenda to the matters which were ‘negotiable’.
[65] Second, the failure to indicate to the NUW that any changes to the employer’s draft provided to them on 30 July 2009 could only be considered if they were provided by 2 August denied the employees represented by the NUW the ability to put a position which could be considered by the employer, prior to a final document being distributed.
[66] Section 228(1)(c) relates to responding to proposals made by the bargaining representative in a timely manner. The company, in this matter, never responded to the union’s log of claims or to their draft agreement in any direct way. The employer’s evidence was that some of the matters raised in the log were contained in the employer’s draft and two matters raised by the union were addressed in the amended employer’s draft. There was however no response as such to the union’s proposals.
[67] Section 228(1)(d) refers to giving genuine consideration to the proposals of other bargaining representatives and giving reasons for the responses. The company may well have given genuine consideration to the union’s proposals. Mr Poxon’s evidence that he did not understand the union’s log and his requests, on two occasions, that the union present their proposals in a different manner suggests that he had not given the proposals genuine consideration but even if he had he certainly gave no reasons as to why those proposals which were not accepted were rejected.
[68] Section 228(1)(e) refers to refraining from capricious and unfair conduct that undermines freedom of association or collective bargaining. The union relied on two matters in support of its contention that the employer had breached this section. I do not intend to deal with the submissions that go to the issues concerning the scope of the agreement as they are the subject of a separate application.
[69] In relation to the failure of the employer to notify the NUW that it was putting an agreement to the vote, Mr Wong referred to the provisions of section 180. Section 180 is in that part of the Act which deals with the requirements for approval of an enterprise agreement. It requires an employer to do certain things during the ‘access period’ prior to a vote being taken, including giving the employees a copy of the proposed agreement. Mr Wong submitted that section 180 did not require the employers to give a copy to the bargaining representative(s).
[70] Section 180 deals with different matters to those dealt with by section 228 which deals with good faith bargaining. The presentation of a document to employees as part of the requirements of section 180 is a clear indication that the employer considers bargaining to be at an end. The approval of the document would clearly bring bargaining to an end. The presentation of the document to the employees is a clear indication that the employer was not prepared to negotiate any further changes to the proposed agreement. I would consider it to be a fundamental element of bargaining in good faith that a bargaining representative notify other bargaining representatives that it no longer intended to bargain.
[71] The NUW is the bargaining representative for its members who are employed by Defries Industries. The employer circulated an agreement to employees for the purpose of a vote being conducted on their document without telling the representative of those employees who are union members that it was going to do so, without giving them a reasonable time to propose any amendments to the document and without responding to the proposals they put through their bargaining representative concerning the content of such an agreement. In my view, that amounted to unfair conduct undermining freedom of association and collective bargaining.
[72] These are my reasons for the granting of the order [PR988441] on Monday, 10 August 2009.
COMMISSIONER
Appearances:
S. Allison for the National Union of Workers.
A. Wong for Defries Industries Pty Ltd
Hearing details:
2009.
Melbourne:
August 10.
1 ASU v Queensland Tertiary Admissions Centre Ltd[2009] FWA 53.
2 To participate - ‘to take or have a part or share with others’ – Macquarie Dictionary.
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