Prysmian Power Cables and Systems Australia Pty Ltd v National Union of Workers
[2010] FWA 9402
•7 DECEMBER 2010
[2010] FWA 9402 |
|
DECISION |
Fair Work Act 2009
s.423 - Application to suspend or terminate protected industrial action - significant economic harm etc
Prysmian Power Cables and Systems Australia Pty Ltd
v
National Union of Workers; Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia; "Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU)
(B2010/3633)
COMMISSIONER CARGILL | SYDNEY, 7 DECEMBER 2010 |
Application to suspend or terminate protected industrial action.
[1] This decision concerns an application pursuant to section 423 of the Fair Work Act 2009 (the Act). The application has been made by Prysmian Power Cables and Systems Australia Pty Ltd (Prysmian or the company). It seeks the termination or, alternatively, suspension for a period of twelve weeks, of protected industrial action which is being engaged in at present by its employees who are members of or who are eligible to be members of the following organisations:
- National Union of Workers, New South Wales Branch (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) (the Unions)
and whose work is regulated by the Prysmian Power Cables and Systems Australia Pty Ltd Union Collective Agreement 2007 (the Agreement).
[2] The application was the subject of a hearing on 26 November 2010 which dealt with the issue of an order for the production of documents which had been sought on behalf of the Unions. The substantive matter was heard on 2 and 3 December 2010. Because of the nature of the application I have endeavoured to provide my decision as quickly as possible. As a result I have not had the benefit of Transcript for the substantive hearing.
[3] Prysmian was represented by Mr Meehan of counsel and the Unions by Ms Howell, also of counsel. Evidence was given on behalf of Prysmian by Mr T Arronis, the Plant Manager of the company’s Liverpool site. His witness statement is Exhibit Applicant 1. Evidence was given on behalf of the Unions by the following witnesses:
- Mr B Mendonca Organiser for the NUW. His witness statement is Exhibit Respondent 6;
- Mr S Robinson Organiser for the CEPU. His witness statement is Exhibit Respondent 7; and
- Mr K Brown Organiser for the AMWU. His witness statement is Exhibit Respondent 8.
BACKGROUND
[4] Much of the background to the matter is uncontroversial. The Agreement reached its nominal expiry date on 6 July 2010. Each of the unions had served a log of claims on the company at some point during the previous month. Negotiations for a new agreement then began in July.
[5] Meetings were held between the negotiating parties on 14, 22 and 27 July, 5 and 27 August, 16 and 23 September, 12, 14, 18, 20, 22 and 25 October, and 17 and 25 November. The parties have reached agreement on a significant number of issues, however, several large issues remain outstanding. The most important of these concern redundancy payments and wage rates.
[6] On 15 and 17 September I issued protected action ballot orders following applications by each of the unions. The ballots were conducted by the Australian Electoral Commission and were declared on 14 October. In each case the proposed industrial action was authorised by the relevant members of the respective unions.
[7] On 19 and 20 October the Unions notified the company that industrial action in the form of an indefinite strike would commence on 26 October. There has been no work by relevant production employees since that date. That is a period of six weeks.
[8] On 18 November 2010 the company made an application pursuant to section 240 for Fair Work Australia (FWA) to deal with a bargaining dispute. That was the subject of a conciliation conference on 24 November. During that conference there was discussion about the negotiations and, in particular, the major issues between the parties. Those discussions were held with the parties both together and separately.
EVIDENCE
[9] Because of the time constraints in providing my decision the following is a brief outline only of the evidence provided by the witnesses.
[10] Mr Arronis gives evidence about the company. It is part of the Prysmian Group which is based in Milan. The company is wholly owned by its Italian parent. The global group is the second or third largest manufacturer of cables in the world. One division manufactures energy cables and systems for power distribution. The other produces data and telecommunications cables. The Liverpool site falls within the former category.
[11] There are approximately 206 production employees at Liverpool, the great majority of whom are NUW members. I interpose here that the evidence of Mr Robinson is that the CEPU has approximately 11 members who would be covered by the proposed new agreement and the evidence of Mr Brown is that the AMWU has approximately 19 members in that category.
[12] At the beginning of the strike the employees and the Unions set up a camp on a reserve opposite the gate to the site. It appears to indicate a long term commitment. There has also been a picket in place.
[13] Since the commencement of the strike no manufacturing has occurred at Liverpool. Cable that was in the process of being produced at that time remains unfinished.
[14] Mr Arronis identifies a number of areas where economic harm is being caused to the company as a result of the industrial action: disruption to routine business; liquidated damages; ongoing costs; and, ongoing head office costs. He states that the first of these is causing the most significant harm.
[15] Mr Arronis sets out five specific categories of disruption to business: significant reduction in invoiced amounts; order cancellations; orders sitting at the site; backorders for stock outs; and, spoilt goods loss and container demurrage costs.
[16] Mr Arronis notes that this disruption will not cease immediately when production recommences as it will take the company some time to return the business to normal levels of manufacturing.
[17] His evidence is that invoiced amounts for October and November are much less than the average for May to September. October’s amount shows a reduction of $6,675,228 compared to that average. The projected November amount represents a reduction of $16,490,298 compared to the average. Mr Arronis states that, based on these figures and the prediction for December if there is no production, it is estimated that the lost contribution margin for November and December will be $3 to $3.3 million. This will have a considerable impact on the company’s net annual profit.
[18] Mr Arronis was cross-examined at length about these figures and the data from which they were drawn, Exhibit Respondent 5. He agreed that there were fluctuations in invoice amounts from month to month and that December was generally a month with lower volumes. He also agreed that the company had suffered financial losses in earlier years.
[19] Mr Arronis’s evidence is that a large number of orders had been cancelled by customers since the beginning of the strike. The potential invoiced amount of these is $4,780,488. One of these customers had advised the company that the unavailability of cable threatened the viability of a particular project and the security of employment of persons working on that project was under threat. Further, one of the contractors engaged in the project had advised the company that it would be standing down its employees due to the lack of cable.
[20] Mr Arronis states that there is about $684,675 of stock stored at Liverpool the value of which won’t be realised until it can be delivered. Third party warehouses are being depleted of stored material. Mr Arronis states that there are backorders of $2,857,876 waiting to be filled. Once manufacturing begins these orders will need to be met before the company can begin to make stock for warehousing.
[21] If the strike continues there is a possibility that PVC granules, which are used in production and are stored at Liverpool, may become spoilt and unusable because of moisture absorption. If this occurs the company would be required to write off the $200,000 value of the material.
[22] The company is required to pay container demurrage costs for the storage of PVC resin off site. As at 22 November that cost was approximately $60,000. This will increase by about $10,000 per week.
[23] Mr Arronis’s evidence is that the company has six supply agreements which could give rise to liabilities for liquidated damages because of its failure to supply cable. As at 19 November the potential accumulated amount of these was $292,868. If the strike continues this could increase to $309,498. Mr Arronis was unsure whether any of these liabilities had crystallised yet.
[24] Mr Arronis gives evidence about what he terms the “idle cost of production” which is being incurred by the company. This includes costs for things such as electricity, water, forklift hire and mandatory maintenance contracts for boilers and compressors. These costs per month are $250,000. Plant depreciation is $160,000 per month.
[25] Approximately 115 other employees are required to continue to attend work. About 70 of these are located at Liverpool and the remainder, who are sales staff, work in various branch offices. Mr Arronis provided a figure of $1,150,000 per month as the cost of these employees. He acknowledged that part of this cost related to payments such as workers’ compensation and other on-costs.
[26] Mr Arronis’s evidence is that the company also continues to be liable for other ancillary costs such as rent, council tax, telephones, computers, canteen operation, insurance and travel. The total of these costs is approximately $335,000 per month.
[27] The company also continues to incur various head office costs such as servicing of loans, $150,000 per month, and cost sharing arrangements for things such as trademarks and IT licensing, $200,000 per month.
[28] Mr Arronis’s evidence is that, prior to the strike, about 10% of the cable sold to customers was sourced from affiliates overseas. The company has taken steps to source more overseas stock since the industrial action commenced, however, those efforts were now at their maximum. Some product must be locally produced and overseas sourcing is time consuming and costly. In addition, the cost of currency hedging would be prohibitive.
[29] Mr Arronis agreed that, in hindsight, it would have been better not to have had a shut down during early October, however, at the time it had been hoped that the dispute would be resolved in the near future.
[30] No payments are being made by the company to any of the employees who are taking industrial action. The average gross weekly wage of the employees is $1,622. Over a four week period the amount not being paid represents about 7.7% of an employee’s average annual income.
[31] Mr Arronis’s evidence is that he believes the majority of the employees have mortgages, other financial commitments and families to support. The income losses would be causing financial hardship to a number of them. He understands that a number are finding it difficult to meet mortgage repayments and a number are working part-time elsewhere to meet their commitments.
[32] Mr Arronis states that 2009 was a difficult financial year although he acknowledges that it was significantly better than 2008. His evidence is that there are limits to how long the losses due to the industrial action can be sustained. Management is having regular discussions with head office in Milan about the costs so far and the ongoing costs if the action continues. Mr Arronis states that, if approval is given, the company can access a facility line of credit from Prysmian Group Treasury to cover ongoing costs. This facility comes at a cost to the company. Mr Arronis does not believe that the ability of head office to provide financial support is unlimited.
[33] The company usually shuts down for a couple of weeks at Christmas. Employees had earlier been advised that this year the shutdown would run from 17 December 2010 to 10 January 2011. Employees have now been advised that the shutdown has been cancelled in light of the pressing need for replenishment of stock. This was done in the hope that the strike would be over by then, either by negotiation or as a result of this application.
[34] Mr Arronis states that there seems no likely end to the action at present and that the parties are no closer to finalising an agreement. He believes that the parties have reached a stalemate in relation to the question of redundancy payments. He does not believe that the Unions are likely to move much, if at all, on the cap on payments for existing employees. He did agree however that “anything is possible”. The company’s position in the negotiations is “package” based. Until the redundancy issue is decided it won’t put a formal wage offer.
[35] Mr Mendonca gives evidence about the company and the Prysmian Group. He believes that decisions of significance about the Australian business are made in Milan.
[36] Mr Mendonca provides some detail of the negotiations. At the meeting of 27 July the company provided a document which, among other things, identified that it wanted to reduce redundancy payments to the statutory minimum. I interpose here that the present entitlements which have been in relevant enterprise agreements for some years are relatively generous and are uncapped. The present entitlements are set out in clause 25 of the Agreement.
[37] On 12 October the company moved on its earlier position that the statutory minimum should apply. It proposed that there be a cap of 52 weeks for all existing employees and that new employees’ entitlements should accrue at two weeks per year of service up to a maximum of 52 weeks. This was not acceptable to the Unions as it represented a significant reduction in benefits.
[38] Mr Mendonca’s evidence is that, by the end of the meeting of 12 October, the parties had reached substantial agreement on most issues. The major outstanding matters were redundancy payments, wages, weekend work and agency labour.
[39] These issues were not resolved at the meeting of 25 October. Mr Mendonca’s evidence is that the lead negotiator for the company, Mr Brown, said that he could not go further without approval from Milan. Mr Brown also stated that he was not prepared to make a formal wage offer without agreement on the redundancy issue, however, he put an informal offer.
[40] Mr Mendonca’s evidence is that the company has not yet put a formal wage offer in response to the Unions’ claim.
[41] The meeting on 17 November was attended by both the NUW State Secretary and Assistant State Secretary as well as Mr Mendonca. It was a lengthy meeting and dealt only with the redundancy pay issue. The company moved to an 80 week cap for existing employees and a 52 week cap for new employees with varying accrual rates.
[42] Mr Mendonca’s evidence is that the Unions indicated that they were prepared to accept a 52 week cap for new employees accumulated at three weeks per year of service. The parties agreed on this proposal but did not agree on what would apply to existing employees.
[43] Mr Mendonca also gave evidence about certain positions which had been discussed during the conciliation conference on 24 November.
[44] Mr Mendonca’s evidence is that, at the meeting of the parties on 25 November, the company representatives indicated that they were not authorised to discuss wages or redundancy. However, significant steps were made towards reaching agreement on other remaining issues including flexibility and the tool allowance.
[45] Mr Mendonca’s evidence is that the NUW’s view is that there are good prospects of agreement being reached if negotiations continue. If the strike is ended there is no prospect whatsoever of an agreement being reached. Mr Mendonca disagrees with the evidence of Mr Arronis that agreement is not likely. Mr Mendonca notes that both parties have moved their positions on key issues on a number of occasions. The Unions are prepared to continue negotiating and genuinely consider further offers.
[46] Mr Mendonca’s evidence is that he speaks to his members each day and also conducts formal decision making meetings with them. He also meets with the officials and members of the other two unions. Through these processes he is well aware of the views of the employees.
[47] Mr Mendonca’s evidence is that all of the employees who are on strike are opposed to the termination of the industrial action. At meetings on 30 November and 1 December members of the three unions unanimously passed a resolution to this effect. The resolution, Attachment BM17 to Mr Mendonca’s statement, is in the following terms:
“This meeting of (union) members:
Notes that the decision to take industrial action in the form of an indefinite strike was taken by members with full knowledge of the possible consequences;
Notes that members have not suffered significant economic hardship to date and further notes that in any event the unions have in place systems for providing support to individual members as required;
Endorses the strike action to continue until all issues are resolved and an agreement has been reached with the company; and
Asks the Tribunal not to terminate the current industrial action prior to agreement being reached.”
[48] Mr Mendonca’s evidence is that employees feel that the industrial action is the only way to “get the company to see reason”. It has taken a lot of work and organisation to reach this point and employees feel that, if the strike is terminated, they will have lost any advantage they have gained through taking protected action.
[49] Mr Mendonca’s own view as bargaining representative is that termination of the industrial action would severely disadvantage his members. He understands that the representatives from the CEPU and the AMWU share his view.
[50] Mr Mendonca’s evidence is that the majority of his members would have more than 20 years service and their average age is about 50. The members are generally well set up financially and overtime in recent years has assisted them to get ahead on mortgage repayments or, in some cases, pay the mortgage off entirely.
[51] Mr Mendonca’s evidence is that members were well prepared for the stoppage. Some have obtained alternative work and some have made arrangements to have loan repayments frozen for the duration of the strike.
[52] The NUW has a fund which provides interest free loans and ex gratia payments in some cases. All members have been informed of this facility and some have called upon it.
[53] Mr Mendonca’s evidence is that the 104 week redundancy cap for existing employees which has been proposed by the Unions has not yet been authorised by employees. He agreed that, unless the company was prepared to move on the issue, there would be a long drawn-out dispute about the matter. Mr Mendonca did note however that, if the company put a position that might be acceptable, he would be prepared to recommend it to members. This included a lower redundancy cap.
[54] Mr Robinson’s evidence is that he agrees with the statement of Mr Mendonca. His members have instructed him that the industrial action should be allowed to continue and that, if it is terminated, they will lose any advantage which they have gained through their action so far. His members are of the view that there is potential for agreement if the strike continues but no prospect of agreement if the strike is terminated.
[55] Mr Robinson’s evidence is that, as bargaining representative, the CEPU’s view is that the action should be allowed to continue. There is potential to reach agreement if this occurs. Other disputed matters are close to agreement.
[56] Mr Robinson’s evidence is that the view of the CEPU and its members at Prysmian is that the members are not currently suffering significant economic hardship. Members were prepared for the stoppage and knew what the effects would be.
[57] The CEPU has a fund which provides interest free loans and payments upon application. Mr Robinson’s evidence is that he has provided the relevant forms to each of his 11 members and has received completed forms from eight of them. The amount of the payment is $290 per week with an extra $60 for each child under 18. The payments are activated after a strike has continued for two weeks. Mr Robinson accepted that the employees’ loss of their entire earnings whilst on strike was loss of an economic nature.
[58] Mr Robinson’s evidence is that the proposal of a 104 week redundancy cap had been discussed with members, however it couldn’t be put to a formal vote until there was agreement on all issues. He didn’t anticipate breaking ranks with the other unions. Mr Robinson’s evidence is that there had been discussions with the other union representatives and there was potential for the Unions to move from their position on the cap if the company moves as well.
[59] Mr Brown agrees with the statement of Mr Mendonca. His members have instructed him that it is their strong view that the strike be allowed to continue. Further, if it is terminated, they will lose any advantage they have gained thus far. The members are of the view that there is potential for agreement if the strike continues but none if it is terminated.
[60] Mr Brown’s evidence is that the AMWU, as bargaining representative, believes that the strike should be permitted to continue and that there is potential to resolve the dispute if this occurs.
[61] Mr Brown’s evidence is that it is the view of the AMWU and its members at Prysmian that the members are not presently suffering significant economic hardship. Members were prepared for the stoppage. The AMWU has a hardship fund which provides for automatic payments to members after two weeks of a strike. The initial payment is $200 per week. This increases to $250 after five weeks. There is also separate provision for children under 16. All 19 members have been in receipt of these payments.
[62] Mr Brown’s evidence is that the Unions have been bargaining as a single bargaining unit and he anticipates that such a position will continue.
SUBMISSIONS
[63] A written outline of submissions was provided on behalf of the company and written submissions were provided on behalf of the Unions. Counsel also made extensive oral submissions. I have had regard to all of that material however, in view of the urgency of the matter, I do not set it out in detail.
[64] In very broad terms the company submits that all of the factors set out in section 423 have been made out and there are more than sufficient grounds for me to exercise my discretion to terminate the industrial action.
[65] The factors identified in section 423(2) and (4) are addressed in detail and reference made to a number of authorities which are set out in a folder. In addition, Mr Meehan submits that the Full Bench decision in Construction, Forestry, Mining and Energy Union v Woodside Burrup Pty Ltd and others[2010] FWAFB 6021 (Woodside) should be distinguished.
[66] Mr Meehan advances several reasons for this proposition including the fact that both the phrase and statutory context being considered in that matter were different to those which are relevant in the present case. He submitted that I was not bound to form a conclusion similar to that formed by the Full Bench that, in order to be “significant”, harm need be “exceptional”.
[67] Mr Meehan notes that, in the present case, there is objective evidence of actual economic harm being suffered by both the company and relevant employees. It was not necessary to predict what that harm might be. Mr Meehan notes that there is an element of subjectivity involved in deciding what is “significant” in terms of the phrase and he submitted that I should bring my own industrial experience to this issue.
[68] Mr Meehan submits that there is ample evidence that employees, or at least one of them, have suffered significant economic harm. The employees have received no income for the period of the strike. The fact that some may have been able to have mitigated some of that harm is not relevant. The statute focuses upon the causal connection between the action and the harm. The very fact that employees have been able to access hardship funds infers that they are suffering hardship.
[69] The evidence of Mr Arronis provides a clear picture of the economic harm which has been caused and will continue to be caused to the company if the strike is not terminated. Mr Meehan submits that it would be difficult to conclude that this harm was not significant.
[70] Mr Meehan submits that the fact that the company is part of a global group is not relevant. The Act requires consideration of the position of the employer, not any wider corporate arrangement.
[71] Mr Meehan submits that it is clear from the evidence that there is no reasonable prospect of the parties reaching agreement about the redundancy payment issue.
[72] Again, in very broad terms, the Unions submit that there is no jurisdiction to make the order which is sought. Alternatively, if I find that such jurisdiction exists, then I should not exercise my discretion to make the order.
[73] The Unions submit that the Woodside decision is particularly relevant to the present matter and should be followed. Ms Howell submits that the observations of the Full Bench are even more compelling here because the test is section 423 is higher than that in section 426 which is concerned only with effects of industrial action upon innocent third parties.
[74] Ms Howell submits that the scheme of the Act contemplates that parties may use industrial action to cause economic harm to each other. Although the company has shown that there have been adverse consequences as a result of the industrial action, these are no more than the consequences which would normally be expected from an indefinite strike. The company is not suffering exceptional economic harm.
[75] The Unions submit that the character and resources of the employer are relevant in determining the source, degree and nature of any harm. The fact that the company is one of the world’s largest cable manufacturers is particularly relevant.
[76] The Unions submit that the evidence which has been provided by the company as to the degree of harm being experienced is imprecise and characterised by assertions and conclusions.
[77] Ms Howell submits that there is no suggestion that dire consequences might flow if the strike continues. She notes that the evidence shows that the company has made significant losses in some previous years and there is no suggestion that it did not have the capacity to cope with a further loss this year.
[78] The Unions submit that the bargaining process is far from concluded. The parties have both moved on the important issue of redundancy payments. Ms Howell notes that the company’s stance of not putting a formal position on wages has proved to be an impediment to negotiations and, further, that there were possibilities which had not been properly explored.
[79] Ms Howell submits that, when parties are negotiating a substantive agreement involving a possible large reduction in employee entitlements, negotiations often take a long time. If the industrial action is terminated the company will have no incentive to agree and the chance of the parties reaching an agreement will diminish.
[80] Ms Howell submits that the income being received by the employees whilst they are on strike is relevant to the issue of whether they are suffering significant economic harm.
CONCLUSIONS
[81] As indicated earlier, the application is made under section 423 of the Act. The relevant parts of the section are as follows:
“(1) FWA may make an order suspending or terminating protected industrial action for a proposed enterprise agreement that is being engaged in if the requirements set out in this section are met.
Requirement—significant economic harm
(2) If the protected industrial action is employee claim action, FWA must be satisfied that the action is causing, or is threatening to cause, significant economic harm to:
(a) the employer, or any of the employers, that will be covered by the agreement; and
(b) any of the employees who will be covered by the agreement.
........................
(4) For the purposes of subsections (2) and (3), the factors relevant to working out whether protected industrial action is causing, or is threatening to cause, significant economic harm to a person referred to in those subsections, include the following:
(a) the source, nature and degree of harm suffered or likely to be suffered;
(b) the likelihood that the harm will continue to be caused or will be caused;
(c) the capacity of the person to bear the harm;
(d) the views of the person and the bargaining representatives for the agreement;
(e) whether the bargaining representatives for the agreement have met the good faith bargaining requirements and have not contravened any bargaining orders in relation to the agreement;
(f) if FWA is considering terminating the protected industrial action:
(i) whether the bargaining representatives for the agreement are genuinely unable to reach agreement on the terms that should be included in the agreement; and
(ii) whether there is no reasonable prospect of agreement being reached;
(g) the objective of promoting and facilitating bargaining for the agreement.
Requirement—harm is imminent
(5) If the protected industrial action is threatening to cause significant economic harm as referred to in subsection (2) or (3), FWA must be satisfied that the harm is imminent.
Requirement—protracted action etc.
(6) FWA must be satisfied that:
(a) the protected industrial action has been engaged in for a protracted period of time; and
(b) the dispute will not be resolved in the reasonably foreseeable future.”
[82] I note that, for the purposes of subsection (7), the application has been made by the company which is a bargaining representative for the proposed agreement and therefore has standing to make the application.
[83] Before turning to consider the issue of whether the industrial action is causing or threatening to cause significant economic harm to the company and any of the relevant employees it is necessary to examine the question of whether the Woodside decision should be followed.
[84] The Full Bench in that matter was specifically considering the words “significant harm” which appears in section 426. The relevant phrase in section 423 is “significant economic harm”. It is true that there are several considerations in section 426 which are different to those which are relevant in the section to be considered in this matter. These include: the mandatory nature of the section; the restriction of FWA’s powers to that of suspension; the unlimited nature of the harm; public interest considerations; and, the fact that there is no requirement that the action be protracted or that there be harm to the direct negotiating parties.
[85] Nevertheless, both sections appear in the same Division of the Act and were part of one comprehensive piece of legislation. In my view it is unlikely that, in the absence of any such declared intention, Parliament would have intended the phrases to have been construed as being different, other than of course, that in section 423 the significant harm is restricted to that of an economic nature whereas section 426 is not so constrained.
[86] In my view it is appropriate that I follow and apply the Full Bench decision. In particular, that requires a construction of the term “significant economic harm” as “having a meaning that refers to harm that has an importance or is of such consequence that it is harm above and beyond the sort of loss, inconvenience or delay that is commonly a consequence of industrial action. In this context, the word “significant” indicates harm that is exceptional in its character or magnitude when viewed against the sort of harm that might ordinarily be expected to flow from industrial action in a similar context.” 1
[87] Against that backdrop I now turn to consider the requirement in section 423(2) that I must be satisfied that the present industrial action is causing or threatening to cause significant economic harm to the company and any of the employees. This also involves a consideration of the factors set out in section 423(4).
[88] The evidence which is relevant to my consideration of these factors is set out earlier in this decision and I do not repeat it here. The evidence as to the source, nature and degree of harm being experienced by the company is contained in the statement and testimony of Mr Arronis. I accept that the company has suffered and, in all likelihood, will continue to suffer considerable economic harm. However, the evidence does not support a finding that this is “significant” in terms of it being exceptional in either its character or magnitude. It is the very sort of harm which would be expected to result from an indefinite strike.
[89] Similarly, the evidence as to the economic harm which is being suffered by the employees demonstrates that it is no more than the foreseeable and expected outcome of the industrial action. I accept of course that the employees are experiencing some economic hardship. Even with other forms of assistance, be that from the Unions, alternative employment or social security benefits, the absence of the entire amount of employees’ usual remuneration must be having some impact. Again, in all likelihood, this hardship will continue.
[90] The company is part of a large multinational business. Nevertheless, it has had six weeks of lost production whilst continuing to incur ongoing costs associated with maintaining the Liverpool site and conducting its business. It has incurred and will continue to incur considerable losses. It does not have an unlimited capacity to continue to bear those losses.
[91] The evidence as to the capacity of the employees to bear the harm they are experiencing is rather general. Through their bargaining representatives they say that they were prepared for the stoppage and knew what the effects would be.
[92] The views of the parties are starkly different. The company seeks an end to the industrial action. The employees and their bargaining representatives are of the view that the strike should be allowed to continue. The resolution set out at paragraph 47 above was unanimous.
[93] It is agreed that no issue arises in respect of paragraph (e) of section 423(4).
[94] I am unable to conclude that the company and the Unions are genuinely unable to reach agreement or that there is no reasonable prospect of agreement being reached. My observation from my involvement in the conciliation conference on 24 November is that there could have been movement in relation to the redundancy issue had it not been for the distraction of this application.
[95] It is also my observation that, until there is some discussion about the issue of wages and exploration of various options and components of whatever “package” is put, it cannot be said that there is no reasonable prospect of agreement being reached.
[96] I have considered the legislative objective of promoting and facilitating bargaining. It is my view that, at the present time, this objective would not be assisted by terminating the protected industrial action.
[97] I have considered the factors set out in section 423(4) and, on the basis of my observations in that regard, I am not satisfied that the requirements of subsection (2) are made out. Specifically, I am not satisfied that the industrial action is causing or threatening to cause significant economic harm to the company or any of the employees.
[98] As a result of this conclusion, subsection (5) is not relevant. In some respects subsection (6) has little work to do in the light of my findings. Nevertheless I shall briefly address its two elements.
[99] There is little guidance as to the meaning of “protracted period of time”. Ultimately it is a subjective decision to be made in the context of a particular matter. Although minds will certainly differ on this point, I am satisfied that the present period of industrial action has been protracted. However I am not satisfied that the second element of subsection (6) has been made out. In this regard I refer to my observations in paragraphs 94 and 95 above.
[100] The differences between the parties are relatively confined and, even in relation to the contentious issue of redundancy, they should be able to engage in further meaningful negotiations with incentives on both sides to reach agreement. At the very least I am unable to be satisfied that the dispute will not be resolved in the reasonable foreseeable future as required by subsection (6).
[101] In summary, the requirements of subsections (2) and (6) have not been met and consequently there is no jurisdiction to terminate or suspend the protected industrial action.
[102] The application is dismissed.
COMMISSIONER
Appearances:
S. Meehan of Counsel with A Deardan for Prysmian Power Cables and Systems Australia Pty Ltd
C. Howell of Counsel with S. Mueller for the National Union of Workers-New South Wales Branch, A. Walkaden for “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) and S. Robinson for the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia.
Hearing details:
2010.
November 26,
December 2 and 3.
1 Paragraph 44 of Woodside
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