National Union of Workers v Hawa Dane Pty Ltd T/A Empire Office Furniture

[2015] FWC 1323

[2015] FWC 1323

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.236 - Application for a majority support determination

National Union of Workers
v
Hawa Dane Pty Ltd T/A Empire Office Furniture
(B2015/203)

COMMISSIONER ROE MELBOURNE, 26 FEBRUARY 2015

Application for a majority support determination.

[1] The NUW has applied for a majority support determination. The parties agree, and I am satisfied, that the application has been properly made (Section 236 of the Fair Work Act 2009 (the Act)) and that the employer who will be covered by the proposed agreement, Hawa Dane Pty Ltd T/A Empire Office Furniture (Empire Furniture), has not agreed to bargain (Section 237(2)(b) of the Act). The two primary matters which are disputed and which must be determined are:

● Was the group of employees who will be covered by the agreement fairly chosen? Given that the group is not all the employees of the employer, in answering this question I must take into account whether the group is geographically, operationally or organisationally distinct (Section 237(2)(c) and Section 237(3A) of the Act).
● Do the majority of the employees, at a relevant time determined by the Fair Work Commission, who will be covered by the agreement, want to bargain? In determining this matter I must decide if the petitions provided by the NUW demonstrate that the majority want to bargain and in doing so I must consider if the petition is an appropriate method to work this out in the circumstances of this case (Section 237(2)(a) and Section 237(3) of the Act).

[2] If the answer to either of these questions is “no” I cannot issue the determination. If I am satisfied that the answer to these questions is “yes” I must issue the determination operative from today’s date provided that I also consider it is reasonable in all of the circumstances to make the determination (Section 237(2)(d) of the Act).

[3] Evidence was given about the nature of the work performed by Empire Furniture and its employees and concerning the circumstances in which the petition was collected. The NUW did not wish to disclose the names of the signatories to the employer. They provided the employer with redacted copies of the petition and the Fair Work Commission with the originals. Shortly after the hearing the company provided lists which showed all employees engaged in particular functions and also details of any employees who had left or had been employed since the petitions were collected.
[4] The petition has been compared to the employee lists provided by the employer on 27 January 2015. I reached the following conclusions about the petitions based upon that comparison and the parties had the opportunity to make submissions about those conclusions.

NAMES ON PETITION ALSO ON EMPLOYER LIST (19 NOV)	TOTAL ON EMPLOYER LIST 19 NOV	TOTAL ON EMPLOYER LIST 21 JAN
TOTAL	23	40	39
DESPATCH ASSEMBLY	7	8	8
DESPATCH ORDER PICKER	3	5	5
DESPATCH- DOCKS/WARRANTY	2	4	4
TRUCK DRIVER/OFFSIDER	10	15	14 (3 left and 2 new employees - The three who have left all signed the petition)
DESPATCH DATA ENTRY	1	2	2
DESPATCH OTHER ADMINISTRATION WORKERS	0	6	6

Which employees are covered by the proposed agreement?

[5] In their application the NUW describe those to be covered by the proposed enterprise agreement as “the employees who are engaged in warehousing and driving roles in the Employer’s warehouse located at 51-63 Heaton Street Rocklea.” They go on to state that:

“These employees are separate and distinct from the managerial staff, administration and human resource staff on site, They work in a particular area (warehouse) and have their own supervisory chain. These employees are also separate and distinct from other managerial, administrative and retail staff who work at other sites, namely the retail stores.”

[6] In summary the NUW seek that “the non-salaried employees performing stores and driving functions in the warehouse at Rocklea” should be covered.

[7] Empire Furniture provided employee lists to the Fair Work Commission of the warehousing and driving employees following the hearing. The lists reveal that during the period from November 2014 until 21 January 2015 there were 8 assembly workers. Ms Neale gave evidence that there were seven. The lists reveal that there are 5 pickers. Ms Neal gave evidence that there were six. The lists reveal that there are 2 docks workers, 1 worker involved in both docks and warranty and 1 worker whose job is warranty repairs. Ms Neal’s evidence was consistent with this. The lists reveal that there were 15 drivers in November 2014 and that there were 14 in January 2015. Ms Neal gave evidence of 14 drivers.

[8] There was some confusion and controversy about administrative workers located in a separate office adjacent to the warehouse dock.
[9] Empire Furniture argues that the 8 administration workers should be included. They base their submission on the evidence of Mr Mackay that:

● He observed around 25 warehouse workers and distribution drivers on site at times when most drivers would have been on the road.
● He described the work performed by the warehouse workers and distribution drivers the NUW wished to cover in the agreement as including paperwork associated with the despatch and ordering of goods.
● In most of the warehouses he dealt with despatch people are part of the warehouse.

[10] The evidence of Mr Mackay did not establish a bright line separating those primarily engaged in administration tasks associated with the warehouse from other warehouse workers and his evidence on this point was not fully clear and consistent.

[11] However, Mr Mackay said that the people he was talking about generally did work out on the warehouse floor as well as did paper work. 1 He clarified that: “if it’s despatch and receive at the dock, they would be workers we would seek to cover.”2 Mr Mackay said that he hadn’t approached any clerical workers to sign the petition.

[12] It is a matter for the applicant to determine who it seeks to be covered by the agreement. The legislation talks of the “proposed” agreement which I am satisfied is a reference to the proposal of the bargaining representative. The NUW have made it clear in their applications and in their submissions that they wish to confine the proposed agreement to employees who are engaged in warehousing and driving roles and they wish to exclude salaried staff and those engaged at retail sites or in administration.

[13] It would be unreasonable to expect a union bargaining representative to have full and accurate knowledge of the employer’s workforce prior to seeking a majority support determination. Majority support determinations will commonly be sought in circumstances where union membership and union involvement are hotly contested matters. The union will not necessarily have had a deep or long involvement with the site. Mr Mackay’s assessment of the number of warehouse workers cannot be fairly used to reach a conclusion about the scope of the agreement sought.

[14] Ms Neale gave evidence that the working hours of at least some of these workers were the same as that of the warehouse workers and drivers. These workers along with the warehousing and driving workers report to logistics management. There are administration workers who work in a separate office part of the building and who work office hours and who do accounts, sales and other data entry work. These workers generally report to different management than the warehousing workers and drivers.

[15] Ms Neale described this group of workers as data entry workers on some occasions and on other occasions as despatch administration workers. Ms Neale referred to nine or ten people, including the logistics manager, who work in a separate office near the loading dock 3 including:

● An administration person who coordinates the drivers runs.
● Two project workers who coordinate and do the paperwork for projects such as major fits outs for customers (they may also supervise and do hands on work when on site, but do not do such work in the warehouse).
● Three people who receive all the paperwork from the dock staff about movements in and out and information from warranty workers.

[16] Ms Neale gave evidence that these nine or ten people do not do any assembly, packing, loading or unloading or driving work. 4

[17] The list provided by Empire Furniture describes 8 people who are despatch administration workers:

● One administration support
● Two despatch data entry
● One group stock purchasing
● Two project coordinator/installer
● One logistics supervisor
● One truck run coordinator

[18] On Ms Neale’s own evidence it is clear that all of these workers except perhaps the two despatch data entry workers are primarily engaged in clerical administration or in supervision or coordination. Ms Neale gave evidence that the two despatch dock workers receive paperwork on the floor and take it to the office where the data entry people are located in order for those data entry people to do the necessary recording. 5 The despatch dock workers coordinate the truck runs, making sure that they are ready to be loaded and doing all the paperwork associated with those runs.6 I consider it likely that Mr Mackay was referring to the two despatch docks workers and not to the despatch data entry workers when describing the coverage sought by the NUW. Mr Mackay was referring to those who perform materials handling work as well as paper work and who perform work at the dock as opposed to those who work exclusively in a separate office.

[19] I am satisfied that the dock data entry workers perform exclusively administration functions in the office and are not within the coverage of the proposed agreement.

[20] One employee, a dock data entry worker, from amongst the 8 despatch administration workers signed the petitions. It is not unusual for persons who are not within the proposed coverage to sign petitions. If the petitions are gathered by a union official that official is not necessarily familiar with the functions performed by each employee and it is not practical in a work environment for the official to closely question each employee about their role. If there are a significant number of signatures from those who would not be covered by the proposed agreement then this may be a relevant consideration as to the weight to be given to the petition and/or to submissions by the bargaining representative about the intended coverage. In the circumstances of this case I am not satisfied that the fact that one employee is not within the proposed coverage is significant.

[21] There were therefore 32 employees as at 19 November 2014 who would be covered by the proposed agreement. This number reduced to 31 by 21 January 2015.

Was the group of employees who will be covered by the agreement fairly chosen?

[22] In approaching this question I have had regard to similar considerations to those I adopted in National Union of Workers v Cotton On Group Services Pty Ltd and by the Full Bench appeal in that matter. 7

[23] Empire Furniture submit that the lack of distinctiveness of the workers chosen is multifaceted given the integrated nature of the operations of the employer. Empire Furniture relied upon the evidence of Ms Neale to demonstrate that the group was not fairly chosen because of the high level of multi-skilling and multi-tasking between employees and the various parts of the business.

[24] Ms Neale was not directly responsible for the workers in question and I am not satisfied that she had detailed hands on knowledge of the way in which jobs were separated and the extent of multi-skilling. Ms Neale was quite uncertain about the reporting lines for the warehousing workers. Ms Neale was very focused on asserting high levels of multi-tasking and the lack of clear job demarcation. However, when questioned it was clear that most warehouse workers were primarily, engaged in the warehouse or on site with customers. I did not find Ms Neale to be a convincing witness when describing job demarcations. I am satisfied that she overstated the extent of multi-tasking and blurred the distinctions between different departments and functions. For example, in the end she described the extent of multiskilling amongst warehousing workers as “they do move around a little.” 8

[25] Ms Neale estimated that there had been a reduction of half a dozen people in the docks logistics area between the time of the petitions on 18 and 19 November and the date of the hearing on 23 January 2015. 9 The data produced by Empire Furniture shortly after the hearing shows that the only staff changes had been amongst drivers and in respect to drivers there had been a reduction of one person (three drivers had left and two new drivers had been employed). This illustrates the nature of the problem I found with Ms Neale’s evidence.

[26] The evidence was reasonably consistent about the role of assemblers, pickers, warranty repair workers, docks workers and drivers in the warehouse. These people mainly work in the warehouse or delivering and/or assembling at customer sites. Some of these workers do warranty or repair work in the warehouse or sometimes at customer sites. 10 There is some multi-skilling between these roles in the two warehouses located at the Rocklea site. These employees are required to do some paperwork associated with goods in and goods out of the warehouse or recording time taken to assemble a product. Drivers may have to get paper work signed when delivering to customers and on some occasions may process payment. Assemblers may perform assembly work for customers on site. Occasionally assemblers and dock workers from Rocklea may assist with setting up showroom displays at stores. Otherwise the work of these employees is generally within the warehouses. These employees sign on and off for work at Rocklea. Two exceptions to this were referred to by Ms Neale. There may, on occasion, be a major fit out for customers which requires a team to travel and the work may extend over more than one day. There are occasions when employees may be redeployed to another job to relieve an employee on leave.

[27] There are approximately 77 employees which the NUW do not seek to cover by the proposed Agreement. The majority of these are employed at the 11 retail stores. The other main group of employees are in administration. As discussed earlier the administrative workers fall into two groups - the head office administration at Rocklea and the despatch administration which is located next to the docks in the warehouse.

[28] At each of the stores there is a manager, a salesperson, sometimes an administration support and a despatch person. 11 Empire Furniture submitted that the stores employees are not operationally, geographically or organisationally distinct. I accept the 11 despatch workers at the stores have similar skills to the despatch workers at the warehouse. However, I am not satisfied that their work is integrated or that they regularly work together. I accept that on occasion workers are moved to relieve someone who is on leave. This is not common or normal. I accept that on occasion warehouse workers may be part of a group who install displays in stores. These are special events. Ms Neale gave evidence that on occasion the despatch workers may be part of a project team working on a major customer site installation. However, she clarified that it was despatch workers from the Rocklea warehouses who were selected to be part of the project teams.12

[29] Empire Furniture refer to the following evidence of Ms Neale to support the contention that there is lack of distinctiveness between the despatch staff in the stores and the despatch staff at the warehouse:

“The people who are employed at each store in despatch, do they exclusively work at a particular store or can they perform their work at other locations?---All our staff move between stores; between retail stores and also between the retail store and the group head office, our logistics centre, depending on where the workload is.” 13

[30] Having observed Ms Neale in the witness box I concluded that she was so focused on resisting the NUW’s application in this matter that she did not carefully listen to the questions and that her responses were not always directly related to the question asked. I consider the answer quoted above to be a general sweeping statement about the extent of multi-skilling and flexibility within the business. It does not accurately reflect the level of mobility and multi-skilling of employees. In other evidence Ms Neale confirmed for example that pickers do not join teams which go to installations at stores and customer sites. She also confirmed that the administration workers do not do physical work in the warehouse.

[31] I am not satisfied that despatch workers from the stores commonly work in the warehouse. Given that some of the stores are a considerable distance from the warehouse it would not make business sense.

[32] I consider that a single despatch worker in a team at a store who reports to a store manager and works directly with other store sales workers to be much more integrated with the stores employees than with those in a remote warehouse. Those in the warehouse report to different management and are much more integrated with a larger team of other warehouse workers, assemblers and drivers.

[33] I also accept the submission of the NUW that the sales, despatch and administrative workers in the stores would be likely to be covered by the General Retail Industry Award 2010 whilst those who work in a warehouse are likely to be covered by the Storage Services and Wholesale Award 2010 and the clerical/administrative employees at the Rocklea head office are likely to be covered by the Clerks - Private Sector Award 2010. This is illustrative of the distinctness of these groups.

[34] I am satisfied that those who normally start and finish their work at the warehouse are geographically distinct from those who start and finish at a retail store. Some of the retail stores are a considerable distance from the warehouses and all of them are geographically distinct.

[35] It would be rare for there to be no organisational and operational links between those who work for the same company. There will often be common objectives, common policies, common senior management and some movement of personnel for particular purposes or projects or for development or to cover leave. In this case the stores workers report to their own managers and not to the logistics management who manage the workers in the warehouses. Normally the stores workers and the warehouse workers operate separately and perform separate functions for the company. I am satisfied that there is a reasonably high degree of operational and organisational distinctness between the warehouse workers and drivers at Rocklea and the employees at the stores.

[36] I am similarly satisfied that the head office administration workers are geographically distinct. They are located in a separate building or part of the building adjacent to the two warehouses at Rocklea. They are operationally and organisationally distinct in that they generally report to different management and they utilise different skills and qualifications to those involved in the physical tasks of assembly, repair, movement and storage of goods.

[37] Empire Furniture submit that the despatch administration workers are intrinsically involved in the receipt and despatch of goods from the warehouse and are located adjacent to the docks and work closely with the docks staff who perform the physical tasks.

[38] Ms Neale gave evidence that three or four of the warehousing workers may on occasion do relief work in the office which could involve a bit of data entry. 14 Ms Neale’s evidence in respect to this matter was vague and I am not satisfied that the level of multi-tasking between the despatch administration workers and the warehousing workers is particularly significant.

[39] I accept that there is considerable integration between the warehousing workers and at least some of the despatch administration workers. For example, the drivers would work closely with the truck run coordinator and the dock workers would work closely with the despatch data entry workers. All warehouse workers would work closely with the logistics supervisor. I suspect that there would also be considerable interaction with the administration support person.
[40] However, I am satisfied that although the despatch administration office is adjacent to the loading docks it is an office area separate from the warehouses and in that sense is geographically distinct. The work is integrated but the administration workers do not engage in the physical work of the warehousing workers and drivers and the warehousing workers and drivers only engage in the work in the office to a limited extent. There is a degree of operational distinctiveness. There is little organisational distinctiveness between some of the despatch administration workers and the warehousing workers and drivers.

[41] I do not consider that the selection of the warehousing and driving workers by the NUW is a selection based upon arbitrary or discriminatory grounds. The NUW have not established that this would be the fairest or the most appropriate group. It may be that the fairest or most appropriate scope for an agreement is the whole enterprise or a group that included the warehousing and driving workers together with the despatch administration workers. However, the NUW is not required to establish that the group they have chosen is the group which is the fairest or most appropriate. The scope of the agreement is a matter which can be altered through bargaining and the parties can make application for scope orders where appropriate in that process.

[42] In this case the employees have been invited to sign petitions supporting bargaining for an agreement and also for that agreement to cover warehouse employees and drivers at the Rocklea site. This is an expression of the employee view in support of the scope of the proposed agreement. This is the only evidence of employee views of the appropriate scope. I accept the submission of Empire Furniture that this is not evidence of the employee view of how warehousing employees and drivers should be defined to the extent that matter is in contention. Having regard to the decision in AWU v BP Refinery (Kwinana) Pty Ltd, 15 in considering whether or not the group has been fairly chosen, the employee view supports a finding that a group which is not the whole enterprise and which is confined to warehouse employees and drivers is appropriate. However, it does not necessarily support the exclusion of the despatch administration workers.

[43] Empire Furniture submits that it is not in the interest of the employees who are excluded from coverage for bargaining to be permitted to occur on the basis of the group chosen by the NUW. Empire Furniture rely on the decision of DP Sams in Jenkins. 16 I agree with the NUW that the circumstances of that case are fundamentally different from the present case. In that case the status quo was an agreement which covered a wider group of workers and where there was a very high degree of operational and organisational integration. In the Jenkins case it was reasonable to infer from the status quo the interests of the excluded employees. There is no basis for any inference in this case.

[44] I have taken into account whether the group is geographically, operationally or organisationally distinct. I have concluded that it is to a significant degree geographically and operationally distinct. I have concluded that it is organisationally distinct from the stores employees and also from the head office administration employees but not organisationally distinct from the despatch administration employees. I have taken into account other relevant considerations including the views of the employer, the views of the employees, the objects of the Act and the objects of Part 2-4 of the Act in particular.

[45] I am satisfied that the group is fairly chosen.

Do the majority of the employees, at a relevant time determined by FWC, who will be covered by the agreement, want to bargain?

[46] If I accept the petitions as a suitable guide to the views of the employees then on 19 November 2014, 22 out of 32 employees in the group wish to bargain. Three employees have left since that time and all of them signed the petition and two new persons whose views are unknown have been employed. As at 21 January 2015, 19 out of 31 employees in the group wish to bargain based upon the petition evidence.

[47] Where an employer does not agree to bargain the matter of bargaining may become a contentious matter in a workplace. There is nothing in the legislation which prevents a union from strongly advocating in favour of bargaining. To avoid unnecessary disputation and disruption and to ensure that the objectives of the Act are met I consider it is important to determine these matters as quickly as is possible whilst maintaining fairness.

[48] I am satisfied that Empire Furniture were aware of the existence of the petition on or before 18 December 2014. There is no evidence from Empire Furniture about their awareness of the petition. I doubt that the NUW would have been able to collect the signatures without management having some awareness of the activity. On 18 December 2014 the NUW made written submissions in respect to a right of entry dispute before Commissioner Spencer that the NUW had formally requested bargaining commence and that a majority of the warehousing and distribution workers have formally indicated by way of petition that they wish to bargain with the company. 17 I am satisfied that Empire Furniture was aware of the existence of the petition by 18 December 2014 or earlier and therefore had reasonable opportunity to raise any concerns about the validity of the petition including any issues related to duress at the hearing of this matter.

[49] There have been recent disputes about the access of NUW organisers to employees at the site. I am satisfied that Empire Furniture is strongly opposing bargaining with the NUW. There have also been differences between Empire Furniture and the NUW about the appropriate award coverage of the warehouse and driving employees. I have no doubt that employees have been made aware of Empire Furniture’s views on these matters. Often the views of the employer will have a strong influence upon employees and on occasion employees will be anxious about being seen to express a view contrary to that of their employer. Employees have been considering conflicting views from the employer and from the NUW.

[50] In this situation it is possible that some employees might change their mind. Some who did not sign the petition might now wish to sign the petition and some who signed the petition might now be of a different view. If there was evidence that a significant proportion of the employees had changed their mind or that employees had signed under duress I would probably agree to delay this matter to consider further evidence.

[51] Empire Furniture have sought to introduce new evidence. They have statements from two employees that they no longer support the petition. One of the two employees is not within the coverage and ignoring their signature will not affect the outcome. The other employee says that he was asked to sign the petition to achieve the numbers for an enterprise bargaining agreement. He says that he was led to believe that there were possibilities that there would be back pay of entitlements if the employees were found to be under the Storage award and that additional penalties were owed for a 6am start. The employee said that he has since done his own research and found that this information is incorrect and therefore wishes to retract his support for the petition. If this evidence was accepted it does not cast any doubt on the validity of the petition and its method of collection. The issues the employee says were raised are legitimate and could be the subject of bargaining. There is no evidence of anything which is misleading, coercive or inappropriate. The other employee felt that they were conned because they were told nothing about an EBA, only an increase in wages. Again an increase in wages is a possible outcome from bargaining and there is nothing in the statement which suggests anything which is misleading, coercive or inappropriate. If the evidence were to be accepted the only consequence would be to reduce the number in favour of bargaining from 19 to 18. There would still be a clear majority.

[52] The NUW oppose the admission of the further evidence and if that evidence is considered would wish to bring further evidence themselves. That further evidence from an employee is to the effect that since the signing of the petitions there has been considerable pressure put on employees by the management. The further evidence also attests to the appropriateness of Mr Mackay’s behaviour and advice in approaching workers about the petition. The NUW are also concerned about the circumstances in which the employer obtained their two additional statements.

[53] In the particular circumstances of this case I do not consider it necessary or appropriate to consider further evidence.

[54] Mr Mackay gave evidence of what he told employees and how he instructed the employee who collected the other 8 signatures. I was satisfied by Mr Mackay’s evidence that he approached the matter in a reasonable and professional manner and informed workers of the nature of the petition and the processes of bargaining.

[55] Empire Furniture submits that there are a number of problems with the process adopted by the NUW to collect the petition. They submit that there is no direct evidence as to what the employee who collected 8 of the signatures told employees. Empire Furniture was not able to cross examine the person who collected those signatures as the NUW did not reveal his or her identity. They also submit that the statements of the two employees who have withdrawn their support raises further doubt about the level and quality of information provided to employees. Empire Furniture say that employees may not have made an informed and educated choice. Empire Furniture say that the NUW have failed to provide adequate evidence of the statements made to employees at the time petitions were gathered.

[56] The evidence required for a majority support determination will vary depending upon the circumstances. I do not consider in the circumstances of this case that it is necessary to have direct evidence from the employee who collected eight of the signatures. As in any election it is not for the Fair Work Commission to determine if the employees made the correct choice or the incorrect choice. It is not necessary to determine if all employees were fully informed and educated. It is inevitable that employees will have varying levels of understanding and will face both objective and subjective considerations. There is no evidence before me of employees signing under duress or based on false information. The time period between the gathering of the petition and the hearing of this matter was not so long as to raise doubts about its validity. There were no events between the gathering of the petition and the hearing of the matter which raised doubts about the validity of the petition. I am satisfied that the petition is a reasonable basis upon which to determine whether or not a majority of employees wish to bargain.

[57] I am satisfied that a majority of employees who will be covered by the agreement and who are employed by the employer as at 21 January 2015 want to bargain.

Is reasonable in all of the circumstances to make the determination?

[58] There are no other considerations which I consider stand against making the determination. I am satisfied that it is reasonable in all of the circumstances to make the determination.

[59] Consequently I am satisfied that a majority of the relevant employees wish to bargain for an enterprise agreement as at 21 January 2015. I am also satisfied that each of paragraphs (b), (c) and (d) of section 237(2) of the Acthave been made out. As a result, pursuant to section 237(1) I must make a majority support determination which will operate from the date of this decision. It is issued separately.

COMMISSIONER

Appearances:

Ms I Beynon appeared for the NUW.

Mr C Murdoch (Counsel) appeared with permission for the Respondent.

Hearing details:

2015

Melbourne

January 23

Final written submissions

2015

February 19

 1   PN120.

 2   PN121.

 3   PN235.

 4   PN303 to PN307.

 5   PN232.

 6   PN315.

 7   [2014] FWC 6601 and [2014] FWCFB 8899.

 8   PN333.

 9   PN239

 10   PN296 to PN297.

 11   PN206.

 12   PN246.

 13   PN209.

 14   PN329 to PN330.

 15   [2014] FWCFB 1476, at [29]-[31].

 16   [2014] FWC 6321.

 17   Paragraph 27 of the submissions in RE2014/1835.

Printed by authority of the Commonwealth Government Printer

<Price code C, PR561383>