Public Service Association of South Australia Incorporated v Commissioner for Public Employment and State of South Australia No. SCGRG 94/382 Judgment No. 4510 Number of Pages 21 Industrial Law

[1994] SASC 4510

COURT IN THE SUPREME COURT OF SOUTH AUSTRALIA LEGOE J

CWDS
Industrial law - Enterprise Bargaining Framework (State) Agreement - certified pursuant to Division II Part VIII of the Industrial Relations Act 1972 - concepts, purpose and overall scheme of Enterprise Bargaining in the Framework Agreement - Parties to the Agreement - Public Sector - Government Management and Employment Act 1985 55.4, 28, 29 and 30 - plaintiff is registered employee Association, see 5.117(4) Industrial Relations Act 1972. "Industrial Dispute" and "Industrial Matter" - see Industrial Relations Act 1972.

Treasurer's Direction re payroll deductions for union dues - S.41 Public Finance and Audit Act 1987 - change in manner and form for making deductions from payroll of Public Sector employees - cl.7(c) of the Framework Agreement provided "union payroll deductions will be maintained" - plaintiff alleges the defendants are bound by the Formation Agreement - further alleged the defendants are in breach of the Formation Agreement.

Claims for (a) declaration that the defendant is bound by the Framework Agreement, and (b) an injunction restraining the defendant from committing a breach of the Framework Agreement by ceasing the practice of making regular payroll deductions for union dues. Held: (a) Doubtful whether on a true construction of the Framework Agreement that a declaration should be made. (b) No evidence of any breach of the Framework Agreement sufficient to warrant the granting of an injunction. The evidence indicates the practice of making the deductions for union dues will continue. Bradley v The Commonwealth of Australia (1973) 128 CLR 557 at 565, 581 and 585 referred to. (c) The Treasurer's Direction or Determination as to the mode of making the deductions from the employer's payroll cannot be fettered by the Framework Agreement either as an industrial agreement or at common law. Public Finance and AuditAct 1987, s.41. (d) The form of the injunction is in reality mandatory. The Administrative and Clerical Officers Association, Commonwealth Public Service and Anor v The Commonwealth of Australia and Anor (1979) 53 ALJR 588 at 590-591; 26 ALR 497 at 501-502 referred to. Crown Proceedings Act 1992, s.7(2). (e) The court should not exercise its discretion to grant either equitable relief - declaration or injunction.

HRNG ADELAIDE, 6-8 April 1994 #DATE 19:4:1994

Counsel for plaintiff:     Mr T M Mcrae with Mr P D Hannon

Solicitors for plaintiff:    Duncan And Hannon

Counsel for defendants:     Mr D J Bleby Qc with
   Mr G J Parker

Solicitors for defendants: Crown Solicitor (SA)

ORDER
Summons dismissed.

JUDGE1 LEGOE J The plaintiff by its amended inter partes summons seeks relief in this matter as follows:
    "1. A declaration that the Commissioner for Public
    Employment and/or the State of South Australia are bound by
    the terms and conditions of the South Australian Public
    Sector Enterprise Bargaining Framework (State) Agreement
    certified by the Industrial Commission of South Australia on
    30th November 1993 and that pursuant to clause *7(d) of the
    Agreement the Commissioner for Public Employment and/or the
    State of South Australia are bound to continue to make union
    payroll deductions for the term of the agreement. *Note -
    this is obviously an error - substitute "7(c)."

2. ... (This paragraph seeks relief against the first named
    defendant only by means of a restraining injunction in terms
    identical to those in paragraph 3 which I shall adopt for the
    purpose of these reasons as appears later).

3. Additionally, or in the alternative sought in paragraph 2
    hereof, an order that the State of South Australia be
    restrained and that an injunction be granted restraining it
    whether by itself, its agents, servants or otherwise from
    acting in breach of the South Australian Public Sector
    Enterprise Bargaining Framework (State) Agreement certified
    by the Industrial Commission of South Australia on 30th
    November 1993 by ceasing as at 1st April 1994 or at any other
    date the deduction of union subscriptions from the payroll of
    employees of the defendant who are members of the plaintiff
    or by varying the existing administrative arrangements.

4. Such further order or orders deemed necessary by this
    honourable court."

2. By interlocutory application taken out on the same day as the abovementioned summons, the plaintiff seeks an interim injunction in the same terms as paragraph 3 quoted above. However, counsel for the plaintiff made it clear, in the course of his very thorough and able submissions, that the application for an interim injunction was a "fall back position" which would only be considered if the court was unable to make an order for a permanent injunction or until a specified date in the future. In my opinion an interim injunction would be inappropriate in the circumstances of this matter. An interim injunction can be granted by the court where immediate protection against unlawful conduct is required. The ordinary procedure is that an action for a perpetual injunction is commenced and, then after the issue of the writ, the inter partes application is made to the court inter partes to restrain the performance of the particular acts in question until final order. An interim injunction will only be granted in exceptional circumstances of urgency, having effect for a very short period until an application for an interlocutory injunction can be made; See Spry Equitable Remedies (3rd ed.) p.482. There is no application in this matter for an interlocutory injunction. The plaintiff seeks a final order on affidavit and documentary exhibit evidence.

3. For these reasons I will consider this matter on the basis that the plaintiff is seeking first a declaration and secondly a permanent injunction against the second defendant, the State of South Australia, to restrain the second defendant, namely the Commissioner for Public Employment, in the manner sought in paragraph 3 of the summons referred to above. The relevant facts The relevant facts in this matter are contained in the affidavit of Jan McMahon who is the Secretary of the plaintiff association, which is an incorporated body. The incorporated plaintiff association is registered pursuant to the provisions of the Industrial Relations Act. Section 117(4) provides, inter alia, that upon registration the association becomes a body corporate, under the name stated in its rules, with power to acquire, hold, deal with and dispose of real and personal property. The association has other powers as defined in its rules. The first defendant is a statutory officer appointed under s.23 of the Government Management and Employment Act, 1985. Section 29 of the Act specifies the functions of the Commissioner, which in general relate to personnel management, industrial relations, the classifications of employees and, in particular:
    "(d) to determine in respect of the various occupational
    groups, classifications, structures in accordance with which
    positions in the Public Service are to be classified and, for
    that purpose
     (i) to determine the remuneration, or limits of
     remuneration, payable in respect of each level within each
     classification structure; and
     (ii) where relevant, to determine increments of
     remuneration and the conditions on which they are payable".

4. By sub-s.(2) of s.29 the determinations of the Commissioner may be made from time to time and can be varied or revoked by subsequent determination, and are binding on Chief Executive Officers and other employees, and may be expressed to come into force on specified dates. By s.29(3), in carrying out the functions or exercising the powers of the Commissioner, the Commissioner shall: (a) observe the principles of personnel management described by the Act and endeavour to ensure their observance in the Public Service in general; and (b) observe the directions given from time to time by the Minister responsible for the administration of the Act or by the Board; and (c) observe any binding industrial award, determination or agreement. Considerable reliance was placed by counsel for the plaintiff on this last requirement of s.29(3), namely to observe any binding agreement.

5. It appears from Exhibit "B" to the affidavit of Jan McMahon that the first named defendant is a party to an agreement which is called "The Enterprise Bargaining Framework (State) Agreement" (called "the Framework Agreement"). That agreement is dated 30 November 1993. The agreement is called an "Industrial Agreement" and made pursuant to Division II of Part VIII of the Industrial Relations Act, 1972. The Framework Agreement is made between each and every of the employers included in Attachment "A" to the Agreement (in respect of agencies named in Attachment "B" of the Agreement) and each and every employee association included in Attachment "C". In Attachment "A" the first named defendant is specified as the "Commissioner for Public Employment" (which includes Departments and administrative units created pursuant to the Government and Employment Act)". A number of other employers of a miscellaneous nature, which may be generally classified as coming under the executive umbrella of government, are also listed in Attachment "A". Attachment "B" lists a number of government departments and statutory authorities. Some four of the listed statutory authorities are noted as having previously entered into enterprise agreements. The note to Attachment "B" on p.18 of the Framework Agreement adds "but in considering future agreements they will be subject to the provisions of this Agreement consistent with clause 2 hereof". In this regard reference should be made to clause 2.B., sub-clause (e) which states that certain clauses of the Framework Agreement shall only come into effect in respect of those statutory authorities who have previously entered into enterprise agreements, as those bodies and the employees were at the time negotiating the replacement of existing certified enterprise agreements. The Framework Agreement is subject to the terms of the existing agreement. Where the terms are inconsistent with any of the clauses in the Framework Agreement then the provisions of the existing agreement prevail to the extent of such inconsistency while they remain in force. Attachment "C" lists the unions who are parties to the agreement. The list includes the Public Service Association of South Australia Incorporated, the plaintiff herein.

6. By clause 2.C. the agreement states that it is not the intention of the parties to the agreement "to inhibit or prevent the making of further enterprise agreements by such parties during the life of the agreement, provided such enterprise agreements are consistent with the terms of this agreement". Clause 2.D. provides that the agreement should be read in conjunction with the awards and industrial agreements included in attachment "D" and also the South Australian Public Sector Enterprise Bargaining Framework (Federal) Agreement. Attachment "D" includes a large number of awards including the Public Service (Recreation Leave Loading) Award and industrial agreements, in existence at the time of the signing of the Framework Agreement, which again spread over a number of different departments, authorities and bodies.

7. The Framework Agreement is to remain in force under the provisions of for a period of three years from the date of its certification by the South Australian Industrial Commission: s.113b of the Industrial Relations Act (S.A.) 1972. Section 113b of the above Act provides that if two or more parties agree on the terms of an industrial agreement, relating to an industry, a particular business or a particular place of work, then those parties may apply to the Commission "to certify the industrial agreement under this Division". An industrial agreement is defined in s.6 of the Act to mean an industrial agreement approved under Division I or II of Part VIII, one that is continued in operation under Part VIII or one that was in force before the commencement of the Act and to which the Act continues to apply. Division II of Part VIII of the Act deals with certified industrial agreements whereas Division I deals with general industrial agreements.

8. The purpose of the Framework Agreement is set out in clause 4. The agreement purports to set out "the objectives and parameters for enterprise bargaining in the South Australian Public Sector (SAPS)".

9. Section 4 of the Government Management and Employment Act of 1985 defines "Public sector" as "all government agencies and public employees and the operations and activities carried on by government agencies and public employees". Clause 4 of the Framework Agreement states that the purpose of the management of employees and their unions in the Public Sector is to require them to "take responsibility for initiatives designed to achieve on-going improvements in productivity, efficiency and the enhanced performance" of the Public Sector. The benefits are shared as appropriate by employees, agencies and their clients, and the South Australian Government on behalf of taxpayers. This is designed to further secure reforms through award restructuring and structural efficiency and other reform processes within the Public Sector.

10. The aims and objectives of enterprise bargaining are set out in clause 5. These aims and objectives are wide and include; improvements to structure, facilitating consultation, continuous work-place transformation, allocation of government expenditure to services, facilitating competitive policy, ensuring consultation prior to introduction of change, ensure that agencies make funds available for skills development and training etc., provide training for managers and supervisors etc., open up career change opportunities, support external recruitment programmes, develop performance measurements and appraisal systems, minimise industrial disputation by adhering to the provision of grievance and dispute settling procedures.

11. "Enterprise" means an agency or group of agencies as detailed in Attachment "E": cl.6. A number of these enterprises, as set out in Attachment "E", are enterprises which have previously entered into enterprise agreements, but in considering future agreements they will be subject to the provisions of the Framework Agreement consistent with clause 2. Others are agencies which may also be able to be dealt with as a group with or without the State Opera and State Theatre Company. "Enterprise agreement" is defined in clause 6 to mean "an agreement made by the parties represented on a S.B.C., consistent with the terms of this agreement". "S.B.C." is a Single Bargaining Centre which means that management and union representatives are established in an enterprise, or discreet section of an enterprise to develop and negotiate improved productivity consistent with the agreement.

12. Clause 7 is an important part of the Framework Agreement for the purposes of this matter. That clause states that, inter alia, the overall intent of the agreement is to provide for enterprise bargaining at the enterprise level. The matters to be agreed include: the maintenance of current standards and arrangements for non-retrenchment etc. (sub-clause (a)); to provide certainty, stability and equity for the period of the agreement by maintaining awards, including paid rate awards, and ensuring as far as possible, and as appropriate, that equitable outcomes are reflected in awards at the expiration of the agreement (sub-clause(b)); to maintain existing standards of employment, conditions and superannuation arrangements, including those set out in a number of named Public Sector awards and to maintain etc. administrative instructions and guidelines as they relate to employment conditions, and any successors thereto, but their form and application can be varied by agreement between the relevant parties to this agreement, in accordance with clauses 8 and 9 of the agreement (sub-clause (c)). The latter part of clause 7(c) reads:
    "Nevertheless, where all the parties to an award or
    industrial agreement or other codification of employment
    entitlements consent, the entitlements set out in the
    relevant document may be varied, consistent with the terms of
    this agreement, subject to any ratification required in the
    South Australian Industrial Commission. Union payroll
    deductions will also be maintained."

13. This last sentence which I have emphasized is crucial to the plaintiff's application in these proceedings. Clause 7(d) provides that employees covered by the agreement are ensured access to wage increases arising from the State wage case decisions occurring during the lifetime of the agreement. Clause 7(d) goes on to provide that, where allowable, wage increases will be given effect to via enterprise agreements consistent with the terms of the Framework Agreement, provided that, as set out in 9(j), there will be no double counting. Sub-clause (e) requires in an enterprise agreement a provision to the effect that during its life wage increases available under State wage case decisions shall apply consistent with the terms of the enterprise agreement and the wage case decisions.

14. Clause 8 provides for the framework for enterprise agreements. Including machinery for negotiation in accordance with the arrangements established under the clause and the principles contained in clause 9 of the agreement. The initiatives are designed to increase efficiency, productivity and flexibility within the enterprise. By clause 8(c) certain limitations are placed upon the enterprise agreements "reached under this agreement". By clause 8(6) an enterprise agreement may, subject to clause 8 of the framework agreement and clauses 7, 9 and 10 of that same agreement, vary conditions contained in awards or agreements but not of current certified enterprise agreements. By clause 8 an enterprise agreement must be submitted for certification to the Industrial Commission through one of the relevant parties under s.113, (Division II of Part VIII of the Industrial Relations Act).

15. The principles which operate to underpin the framework detailed in clause 8 of the Framework Agreement are set out in clause 9. Again the provisions are lengthy and wide-ranging in their terminology. The agreed guidelines for trade union participation and consultation on change within the Public Sector regarding enterprise bargaining and Public Sector reform are set out in Attachment "I". Attachment "H" provides for the grievance and dispute settling procedure.

16. Clause 10 makes provision for productivity bargaining and wage outcomes. Clause 11 makes provision to facilitate the bargaining process. Clause 12 provides for renewal of the Framework Agreement no later than six months prior to the cessation of the existing agreement. Clause 13 states that the parties to the Framework Agreement agree that disputes arising out of the agreement will be resolved in accordance with the dispute avoidance and settlement procedures as contained in relevant awards or elsewhere. If there are no agreed provisions then those provisions detailed in Attachment "H" will apply.

17. Clause 14 provides:
    "During the life of this agreement the unions undertake not
    to pursue claims except where consistent with, and
    contemplated by this agreement and except where consistent
    with the State wage principles, or any successor thereto."

18. On 30 November 1993 the Industrial Commission of South Australia certified the Framework Agreement as exhibited to Jan McMahon's affidavit and ordered that the agreement is to commence on and from that day. The plaintiff has approximately 23,819 financial members. The substantial majority of these financial members are employed by one of the employers referred to in Attachment "A" of the agreement and work in various government departments and statutory authorities referred in Attachment "B" of the agreement. The union subscriptions of all such members are paid by way of fortnightly deduction of a pro-rata amount made by the employer from the fortnightly pay due to the member which deduction is then forwarded by the employer to the plaintiff association. Reliance is placed by the plaintiff in this regard on the final sentence in paragraph 7(c) of the Framework Agreement for the maintenance of union payroll deductions.

19. Jan McMahon also deposes in her affidavit to the fact that since in or about 1977 union subscriptions have been paid by members of the plaintiff in the employ of the defendant, in that the employers referred to in Attachment "A" to the agreement and their predecessors have made fortnightly deductions of union subscriptions from the pay due to the relevant member. This arrangement was negotiated with the then Government of South Australia. It has been maintained ever since. Deductions of union subscriptions did not commence and have not commenced with respect to any individual member until that member signed a written authorization. All of the 23,819 members have provided such a written authority. The established practice since its inception has been that the payroll deduction of union subscription has been maintained and would only cease if the particular employee provided the employing agency with written notification terminating the arrangement.

20. Jan McMahon further makes reference to the fact that prior to the State election in December 1993 questionnaires were sent to the main political parties and the answers were given by Mr Dean Brown (the then Leader of the Opposition and since the election, the Premier of this State). These have been exhibited to Jan McMahon's affidavit. The relevant question for the purpose of these proceedings is question No. 14 which reads:
    "14. Payroll deduction of union fees. For the term of the
    next government, will you continue the practice which allows
    members to have their fees automatically deducted from their
    pays? The Labor Party replied 'yes' to that question. The
    Liberal Party replied 'as previously advised to the PSA, we
    have no intention of changing current arrangements.'"

21. The existing arrangements as at late 1993 were those set out in the Treasury Instructions No. 406 headed "Expenditure for Salaries and Wages - Deductions from Salaries and Wages".

22. No. 406.1 reads:
    "A regular deduction from a salary or wage of an employee
    other than a deduction under a statutory requirement should
    be made only on the written and signed authority of that
    employee, preferably in accordance with a procuration order
    (Form 26)."

23. Paragraph 406.8 reads:
    "The total amount of deductions for each other organization
    should be paid by cheque and shall reach the organization on
    the pay period ending date."

24. Paragraph 406.9:
    "Before proceeding to stop deductions for industrial
    organizations, medical funds etc., written authority shall be
    obtained from the employee concerned."

25. On Tuesday, 15 February 1994, the Minister for Industrial Affairs, the Honourable Graham Ingerson M.P., published a media release headed "Public Sector Union Deductions Made Subject to Employee Choice" -
    "From April 1, 1994, each State Government employee will be
    required to choose whether or not they wish the practice of
    automatic deduction of their union subscriptions to be
    continued. Graham Ingerson, the Minister for Industrial
    Affairs, said today, that automatic deduction would continue
    where the employee authorizes this method of payment. Public
    Sector employees will also be required to re-authorize the
    automatic deduction of union payments every 12 months. Mr
    Ingerson said 'the decision to continue deduction of union
    subscriptions was in keeping with the Government's
    pre-election promise to Public Sector employees and their
    unions'."

26. Later in the media release reference is made to the added benefit of ensuring that Public Sector unions become more service-orientated in order to maintain and enhance their standing amongst Government employees. Where automatic payroll deductions of union subscriptions occur, those deductions will be subject to a three per cent administration fee in line with the Government practice with respect to payroll deductions. The previous exemption relating to union subscription deductions for the administration fee is removed.

27. By facsimile dated 17 February 1994 the Minister notified the Secretary of the United Trades and Labour Council of certain consequential details relating to the procedure for deductions for union subscriptions from the payroll package. Attached to the facsimile message was a draft form of authority for deduction of union subscriptions addressed to the Honourable the Treasurer to be signed by the employee. Draft notes are attached to this form and in particular in Attachment 2 headed "Notice to Public Sector Employees", which is to be included with the pay advice, the document states with respect to the automatic deduction of union subscription from Public Sector employees' payroll:
    "1. If you are a member of a union and have, or wish to have,
    your union subscriptions automatically deducted from your
    payroll, you must complete a new authorization by 1 April
    1994."

- that authorization is to be made on the required form and
    personally signed by the employee. Forms are available at the
    union office.

28. Paragraph 4 of Attachment 2 says:
    "If you do not authorize the deduction of union fees from
    your payroll by 1 April 1994, deductions will cease from the
    first pay period on or after that date."

29. Finally, the notice stated that if an employee chose to have the automatic union deductions continued from the payroll, then the employee would be required to re-authorize this practice every 12 months thereafter. Such re-authorization will have to be made no earlier than two months prior to the expiration of the 12 months period. On 22 February 1994 the Minister sent another facsimile message to the Secretary of the United Trades and Labour Council explaining the State Cabinet's review of the options relating to the issue and Cabinet's decision to re-affirm the previous decisions which were communicated on 15 February. The submissions of counsel for the plaintiff Counsel for the appellant submitted that the ministerial statement and the executive directions as to the new procedure for deduction of union dues from the salary packages of employees in the Public Sector had three components.
    1. There must be an original authority signed by each employee
    on or before 1 April 1994. As counsel put it that means the
    existing authority is not good enough. The employee must
    re-authorize the paymaster to make the deduction. There must be a
    new and original authority.

2. The employee must renew that authority every 12 months from
    the last renewal. The previous practice was that once an authority
    had been given by the employee it remained in force until
    withdrawn by the employee.

3. On and from 1 April 1994 the Department would in each case
    make a three per cent charge to the union when forwarding the
    union fees. Counsel also drew attention to the fact that there was
    reference in the affidavit of Jan McMahon and in the other papers,
    and it was agreed, that the executive had given a period of grace
    before the new system be implemented. There will be no change to
    the existing authorities under the old system and the form which
    has in the past been used until 30 May 1994. The deductions will
    continue to be made of the union dues and the fees forwarded to
    the union as previously for the period of grace.

30. Counsel for the plaintiff then put his case on 10 propositions.
    1. The defendants assumed their obligations under the agreement
    as part of an overall scheme being advocated by the Commissioner
    for Public Employment and the State Government.

2. The specific obligation to continue deductions of union dues
    was a careful inducement on the part of the defendants to get the
    unions, including the plaintiff, to go along with the scheme and
    enter into the Enterprising Bargaining Framework Agreement.
    Counsel asked the court to infer this from the fact that no
    sensible union official could ever agree to such an agreement
    unless the agreement guaranteed existing arrangements would
    continue. That was described as the quid pro quo.

3. The plaintiff relied on the promise of continued deduction
    of union dues in reaching a decision to participate in the new
    scheme to be brought about the Enterprise Bargaining Framework
    Agreement. In other words, counsel submitted that the plaintiff
    union shifted their position and that constituted sufficient
    consideration to make the agreement enforceable.

4. The defendants have committed a breach of the agreement. The
    breach relied upon the words referred to above in the last
    sentence of paragraph 7(c) of the agreement.

5. The consequences of the breach are severe in particular that
    the plaintiff union will inevitably suffer a substantial loss of
    membership and therefore loss of revenue. Reference is made to the
    last paragraph of Jan McMahon's affidavit where she deposes to the
    fact that loss of membership strikes at the whole basis of the
    plaintiff union's operations and a substantial loss of membership
    must have a series of effects by reducing services to the members
    and reducing employment in the union office.

6. Very little notice was given by the defendants to anyone,
    particularly the plaintiff, of the proposals and decision to
    implement the new arrangement. The shortness of notice has
    maximised the loss and damage to the plaintiff.

7. The plaintiff who is seeking equitable relief in the form of
    a declaration and injunction come to the Court with clean hands.
    The plaintiff has not acquiesced in anything that has occurred. In
    order to obtain equity the plaintiff has done equity.

8. The plaintiff has not been guilty of any delay in taking
    these proceedings. The summons in this matter was issued within a
    day or so of the last conference at the Industrial Commission.

9. Damages would not be an adequate remedy. Counsel submitted
    that the stability of membership of the plaintiff union cannot be
    maintained by damages. Maintenance of membership is essential to
    an industrial union for stability.

10. The injunction will not cause hardship to the defendants in
    that there is an existing scheme of deductions for union dues
    which has been in effect for some 17 years and there is no
    evidence of any hardship to the defendants in this regard. In
    particular, the defendants agreed to this system when the
    Enterprise Bargaining Framework Agreement was certified by the
    Industrial Commission on 30 November last year. The balance of
    convenience or the balance of justice is such that the plaintiff
    should have its injunction. Counsel for the plaintiff then
    directed his submissions to certain jurisdictional issues. First,
    a question has arisen as to the amenability of the parties to the
    relief as sought by the plaintiff. Counsel for the defendants
    indicated that since the amendment to the summons when the State
    of South Australia was joined as well, the defendants would not be
    taking any point as to whether one or other of the parties before
    the Court is amenable in that capacity. Clearly this is consistent
with the provisions of s.5 of the Crown Proceedings Act, 1992.

31. Next counsel for the plaintiff referred to s.7 of the Crown ProceedingsAct, 1992, which reads:
    "7(1) Subject to sub-section (2), injunctive relief may be
    granted against the Crown.
    (2) A mandatory injunction cannot be granted against the
    Crown."

32. Counsel for the plaintiff submitted that the injunction sought in these proceedings was in the form of a prohibitive order or restraining order upon the Crown rather than mandatory. The draft minutes of order sought an order that the defendant "be restrained and an injunction" be granted restraining the defendant from acting in breach of the Enterprise Bargaining Framework (State) Agreement certified by the Industrial Commission on 30 November 1993 "by ceasing as at 1 April 1994 or at any other date the deduction of union subscriptions from the payroll of employees of the defendant who are members of the plaintiff or by varying the existing administrative arrangements." Spry on Equitable Remedies (3rd ed.) at p.503 states:
    "... a mandatory order is an order that, in substance, is
    directed at compelling the defendant to perform a particular
    act, whereas a prohibitory order is, in substance, directed
    at preventing the defendant from performing a particular
    act."

33. Where the party seeks enforcement of a negative obligation that has been created by an agreement then difficulties may arise as to the form of injunction to be ordered for the enforcement of the agreement. These difficulties are often decisive as to the discretionary considerations to be taken into account by the Court in deciding whether an injunction should issue; See Spry (ibid.) at pp.564-565. Counsel for the plaintiff submits that the form of injunction which is sought by the plaintiff in this matter is consistent with the notion of the principles discussed in Spry (supra). In Bradley v The Commonwealth (1973) 128 CLR 557 the plaintiff obtained an order enjoining the defendants from unlawfully withdrawing postal services from the plaintiff's use, although compliance with the order would in effect involve the performance of positive duties. A mandatory order (not being of a restorative nature) may require a defendant to perform positive statutory duties - De Falco v Crawley Borough Council (1980) QB 460.

34. The next jurisdictional point raised by counsel for the plaintiff was whether it can be said that the deduction of union dues or the cessation of a practice to deduct union dues in the manner in which it had been done in the past can be said to be an "industrial matter" and what consequences that may have. Counsel submitted that the agreement has been certified. "Industrial matter" is defined in s.6 of the Industrial Relations Act to mean "any matter, situation or thing or ... the privileges, rights or duties of employers or employees ... and without limiting the generality of the foregoing includes any matter, situation or thing affecting or relating to:
    "(a) the wages, allowances or remuneration of any persons
    employed or to be employed in any industry, or piece-work,
    contract or other prices paid ..."

35. Section 113a of the Act provides for the parties, namely a registered association of employees such as the plaintiff, and any other association or any person to make an industrial agreement "in relation to any industrial matter."

36. In this regard counsel very properly referred me to a decision of the High Court in relation to the Federal jurisdiction, namely R v Portus Ex parte ANZ (1972) 127 CLR 353. This involved a dispute about the collection of union dues by an employer and the Court held that that was not an industrial dispute. The jurisdictional issue which arises from this decision is whether that decision applies to the State legislation and if it does, whether it is still good authority in the light of certain dicta which has thrown doubt on the decision: see Re the Manufacturing Grocers' Employees Federation of Australia and Anor (1986), 160 CLR 341 where the Full High Court at pp 352 and 353 after quoting from the judgment of Menzies J in Reg v Portus (supra) at 650 and from the judgment of Stephen J in Portus's Case at 371, the High Court went on to state that the question as to whether the claims in Manufacturing Grocers' gave rise to a dispute about an industrial matter was left open by the decision of Reg v Hamilton-Knight: Ex parte Commonwealth Steamship Owners' Association (1952) 86 CLR 283. Counsel also referred to the fact that recently the High Court had given special leave to appeal in the matter of Fimee v Alcan Australia Ltd (1992) 46 I.R.37. Mr McRae also referred to two South Australian cases where the courts have applied the Portus decision; see The Hotel Clubs' Case (1980) 47 SAIR 345 and R v The Industrial Commission (1981) 26 SASR 535 at 537-538 per King CJ.

37. Next, counsel submitted that if the Court is against the plaintiff on the principles laid down in Portus then the plaintiff would seek an interlocutory injunction as opposed to a permanent injunction until the date of the expiration of the agreement.

38. Next, counsel submitted that the agreement is enforceable at common law without the aid of the statute. 1. It is an agreement between the incorporated body and either the Commissioner for Public Employment or the Crown. It was obviously intended to be enforceable by each party. 2. It is not an agreement in restraint of trade. On the contrary it is precisely for the purposes of trade. 3. The dispute is directly between these parties. Counsel further submitted that the general principles for establishing a right to an interlocutory injunction were satisfied in this case and reference was made to Castlemaine Toohey's v The State of South Australia (1986) 161 CLR 148. Counsel for the plaintiff finally submitted that the circumstances of the case support the granting of first the declaration sought and secondly the injunction. See De Smith on Administrative Law, pp.437-442 and Hotop at p.303. In summary counsel submitted that: 1. The breach is deliberate. 2. The loss to the plaintiff is substantial. 3. The plaintiff has in no way acquiesced in the breach. 4. The plaintiff has acted promptly. 5. Damages are not a suitable alternative. The case for the defendants Mr Bleby Q.C., on behalf of the defendants, raised a number of matters by way of answer to the claims. I shall only deal with those points which in my opinion are necessary for determining the matter. 1. Counsel for the defendants submitted that whilst "industrial matter" is very widely defined by s.6 of the Industrial Relations Act the definition is necessarily confined to the relationship between employer and employee. It was submitted that the relevant part of the agreement, which the plaintiff claims has been breached by the defendants, purports merely to regulate or affect the relationship of debtor and creditor between an employee and its union and has nothing to do with an industrial matter. Reference was made to R v Portus (supra) and numerous other authorities following Portus down to Fimee v Alcan Australia Ltd (1992) 46 IR 37, in particular at p.43. In the alternative, counsel argued that the agreement as a whole does not relate to any industrial matter and was erroneously certified as an industrial agreement. Reference was made to the fact that it is a "framework agreement" and that the various particular clauses make constant reference to the fact that enterprise bargaining agreements will be entered into by the various authorities, departments or enterprises within the Public Sector who are employers with their particular employees. Other enterprise bargaining agreements will in due course be entered into. I do not propose to expand further on the submissions of counsel that the Framework Agreement was erroneously certified. The fact is that the first-named defendant entered into the agreement and was represented at the hearing before the Industrial Commission when the agreement was certified by the President. 2. If, however, the relevant provisions of the Framework Agreement are "in relation to an industrial matter" and the agreement is otherwise valid, then counsel submitted that the first-named defendant has power to make decisions and determinations subject to ministerial direction; see ss.28(1), 29 and 30 of the Government Management and Employment Act, 1985. By s.28(2) no ministerial direction shall be given to the Commissioner in respect of the five matters specified in that sub-section. I referred to Section 29 on page 3 above. There is no reference in s.29 relating to the Commissioner's functions to the deduction from regular pay packets of any amounts either for union dues or certain statutory deductions, e.g. Medicare levy. Section 30 provides that the Commissioner for the purpose of carrying out his functions may issue instructions to particular employees or a particular class of employees or employees in general.

39. I was also referred to s.77 of the Government Management and EmploymentAct which reads:
    "77. A determination or decision under this Act affecting
    remuneration or conditions of employment should be subject to
    - (a) any award or determination of the Industrial Commission
    ... and
    (b) any agreement registered under the Industrial
    Conciliation and Arbitration Act, 1972."

40. The latter Act has now been superseded by the Industrial Relations Act. Division I of Part VIII of the Industrial Relations Act deals with registered agreements. Counsel pointed out that this agreement was certified under Division II of Part VIII of the Industrial Relations Act. There is no mention of certified agreements in section 77. The Commissioner is not fettered by the certified Framework Agreement when making any determination or decision he may issue. The procedure and method for making deductions of union fees is not, in counsel's submission, a decision which affected "remuneration or conditions of employment". The question of deduction of union fees is therefore a matter which is open to the Commissioner to make a determination or decision as to how the deduction of union dues is to be done procedurally. Counsel also drew my attention to s.34 of the Government Management and Employment Act where, inter alia, the Commissioner before making any decision or determination or taking any action affecting a significant number of members of a recognized organization shall (a) notify the organization of the proposed decision, determination or action; and (b) hear any representations or argument that may be presented in relation to the proposed decision, determination or action. It was submitted that, so far as necessary, that had been done. By sub-s.(2) of s.34 nothing shall be construed as limiting or restricting the carrying out of any function, or the exercise of any power, of the Commissioner under the Act.

41. The only relevant fetter on the Commissioner's powers is pursuant to s.77 of the G.M.E. Act. The agreement does not prevent the Commissioner from carrying out the ministerial direction given to him as contained in the press media and the correspondence referred to above. Furthermore, the directions, which are said to be preserved by the Framework Agreement, are Treasurer's instructions given under s.41 of the Public Finance and Audit Act 1987 which reads:
    "41(1) The Treasurer may issue instructions -
    (a) requiring accounts to be maintained ...
    (b) setting out the form and content of financial statements
    that must be prepared ...
    (c) requiring that procedures, set out in the instructions,
    be followed in the course of financial administration by the
    Treasurer and public authorities;
    (d) requiring that procedures, set out in the instructions,
    be followed in the operation of special deposit accounts."

42. The directions relating to the proper financial administration of the State cannot be overridden by the industrial agreement. Counsel submitted that there is no equivalent to s.77 of the G.M.E. Act in respect of the Treasurer's instruction. Neither can the discretion to use such instructions cannot be overridden by a common law agreement. 3. Counsel for the defendants submitted that if there is a valid industrial agreement and it is enforceable, then there is no evidence of any breach. First, the commitment in the Framework Agreement is to maintain a standard, including the standard or principle of payroll deductions. There is no evidence in this matter to suggest that that standard or principle is not being honoured. All that is being attended to are the mechanics and putting the practice on a proper commercial footing. It is not a change to the substance of making a deduction for union dues but merely as to how those deductions are in the future to be made from the payroll of employees. Secondly, the agreement contemplates variation and departures from the conditions supposedly enshrined in the Framework Agreement, e.g. see clauses 8(c)(1)(vi), 8(c)(6), 9(g), 9(i), 9(p). Counsel submitted that in the light of those variation provisions in the Framework Agreement the Court should be slow to find that any breach of the agreement justifying a restraint order being made to the effect that the defendants, or either or them, be restrained from departing from an existing practice which change may be justified under the agreement anyway. 4. Counsel submitted that the relief sought is in the nature of a mandatory injunction or specific performance of the agreement. Reference was made to A.C.L.A. v The Commonwealth (1979) 53 ALJR 588 at 590 where Mason J (as he then was) heard an application for an interlocutory injunction restraining the defendants from ceasing to deduct the dues payable by members of the plaintiffs to the plaintiffs and from ceasing to pay those dues to the plaintiffs. There was considerable debate and discussion in his Honour's reasons as to the effect of the contract relied upon by the plaintiffs in that case. The plaintiffs allege that the Commonwealth had agreed that it would deduct from salaries payable to the plaintiffs members' dues payable by those members to the plaintiffs in consideration for which the plaintiffs would pay to the Commonwealth an amount equal to two and a half per cent of the total amount so deducted. At 590 Mason J said:
    "The plaintiffs' case for an injunction must therefore rest
    on the presence of an implied negative stipulation (J.C.
Williamson Ltd v Lukey (1931) 45 CLR 282 at 299), the
    relevant stipulation being that the first defendant will not
    terminate except on reasonable notice. But the injunction
    which the plaintiffs seek finally and at this stage is one
    which would restrain the first defendant from ceasing to
    deduct the dues and to pay them unless and until the contract
    is terminated by reasonable notice. This is merely to
    translate into negative language the affirmative obligation
    created by the alleged contract. In substance, therefore, the
    injunction claimed is to enforce an affirmative stipulation.
    The stipulation is not negative in substance because mere
    inactivity on the part of the Commonwealth would not
    constitute performance. Performance requires deduction and
    payment to the plaintiffs."

43. His Honour rejected argument for the plaintiffs which rested on the fact that the contract was, in reality, one by which the Commonwealth had promised to make deductions by setting up and maintaining a computer programme and there is to be implied a promise not to discontinue the programme. His Honour doubted whether this answered the difficulty, especially that part of the contract which requires the Commonwealth to pay the amounts deducted less commission to the plaintiffs. Accordingly, his Honour concluded that the plaintiffs had not shown that, if the evidence remains the same, that the plaintiffs would probably be entitled to the relief at the trial in the form of the injunction which they sought. Consequently, so argued counsel for the defendants, the injunction which is sought in this case is in reality a mandatory injunction and is not available against the Crown by reason of s.7(2) of the Crown Proceedings Act, 1992. 5. Counsel put forward similar arguments in answer to the plaintiff's claim in these proceedings that the Framework Agreement was enforceable as a common law agreement as well as industrial agreement. Conclusion For the purpose of determining the claim for a declaration and injunction I accept, without deciding as a fact, the following background and circumstances relied upon by the plaintiff as put to me by counsel for the plaintiff:
    1. That the Framework Agreement offers the opportunity for
    individual agreements to be entered into in separate departments
    or parts of departments taking separate circumstances into
    account. It is contemplated by the Framework Agreement that "there
    would be separate workplace agreements in the individual
    departments or even parts of departments."

2. Mr McRae identified the Framework Agreement as (a) providing a
    process of change; (b) providing certain guarantees to encourage
    people to enter into the process of change; (c) providing some
    detail as to how in working out the individual enterprise bargains
    a certain framework of guarantees and minimum standards will apply.

3. That the first defendant was represented and took part in the
    Certification of the Framework Agreement hearing which resulted in
    the President of the Industrial Commission certifying that
    agreement. Accordingly I proceed on the basis that the agreement
    is an "industrial agreement" within section 113 of the Industrial
    Relations Act. But I do not find that the plaintiff's allegation
    of a particular breach of clause 7(c) of the Framework Agreement
    is necessarily an "industrial matter". I refrain from deciding
    that question as it is just necessary to isolate the "breach".

4. That up to and including 1 April 1994 regular deductions from a
    salary or wage of Public Sector employees had been made of union
    dues owing by the employee members in accordance with the
    Treasurer's instructions "Expenditure 406. Deductions from
    Salaries and Wages" - Exhibit "C" to Jan McMahon's affidavit.

5. That the plaintiff first became aware of any change to the
    Treasurer's instructions when the Media Release by the Minister
    for Industrial Relations was published on Tuesday, February 15,
    1994 - Exhibit "F" to Jan McMahon's affidavit.

6. The proposed changes had three components - (a) A new authority
    form had to be signed by each employee before t April 1994. (b)
    Such authority had to be renewed by each individual employee every
    12 months after the first authority. (c) A 3% commission or
    administrative charge would be made by the employer paying the
    salaries. These components are detailed in the Exhibits to Jan
    McMahon's affidavit "F" (the Media Release), "G" (correspondence
    from the Minister of Industrial Affairs to the Trades and Labour
    Council) and "H" (Minutes forming enclosures from the Minister of
    Industrial Affairs to ALL MINISTERS).

7. That the plaintiff has acted promptly in response to the
    Minister's statements and has not been guilty of any delay in
    bringing these proceedings for the relief claimed.

8. That the change in the Treasurer's Instructions may well have
    "severe implications" for the day to day management of the
    plaintiff and its ability to continue operations in its present
    form and with its current staff levels as stated in paragraphs 15,
    16 and 17 of Jan McMahon's affidavit. On the above facts, which I
    accept for reaching my conclusion I ask - 1. Are the defendants or
    either or them bound "to continue to make union payroll deductions
    for the term of the agreement"? (paragraph 1 of the Summons in
    this matter). 2. If so, are the defendants or either of them
    acting in breach of the Framework Agreement "by ceasing as at 1st
    April 1994 or at any other date the deduction of union
    subscriptions from the payroll of employees of the defendant -"
    (paragraph 3 of the Summons in this matter).

44. As to 1. In my judgment on a proper construction of the Framework Agreement as a whole I am far from convinced that there is a duty in contract upon the first defendant to carry on exactly the same procedure as that laid down by the Treasurer's instructions in No. 406. The Framework Agreement is clearly intended to provide a working basis for particular Government Departments and Authorities and other Public Sector bodies to enter into specific enterprise bargaining agreements with the relevant employee associations. But there is no reference to the way in which union dues will be deducted. The only specific reference in the Framework Agreement to union payroll deductions is in clause 7(c) (last sentence). Clause 7 provides for the principal undertakings that the parties may agree to, which include both current standards and arrangements for employment, maintaining awards including access to award increases etc. There is nothing in the Framework Agreement which requires the defendants or any Government body to make the union payroll deductions in any particular way or form. Nor could the agreement override the Treasurer's powers under the Finance and Audit Act (Section 41).

45. In short I am not satisfied that the plaintiff has shown that the defendants are bound as alleged in paragraph 1. As to 2. Even if I am wrong in answering question 1 above in the negative, I am firmly of the opinion that the Minister's announcement in the Media Release dated 15 February 1994, and the subsequent detailed explanation as to the Executive decision concerning the way in which the union payroll deductions would be made in the future after 1 April 1994 or after the period of grace (after 31 May 1994), was not in breach of the Framework Agreement.

46. In my judgment the facts disclosed by the plaintiff establish that the deduction of union fees will be maintained in the manner and form outlined in the exhibits to Jan McMahon's affidavit. There is not and apparently never has been any situation to stop (or cease) making the deductions. The changes are not changes to the Framework Agreement but simply the proposed method and conditions upon which the deductions will be made in the future. That is not, in my opinion, in breach of the agreement.

47. In Bradley v The Commonwealth of Australia (1973) 128 CLR 557 the plaintiff sought a declaration that a direction issued by the Postmaster-General was unlawful and for injunctions to restrain the Postmaster-General and his agents from withholding those services. Barwick C.J. and Gibbs J. (as he then was) said at 565 "the decision of this case depends entirely upon the proper construction of the Act and regulations". The majority of the Court held that the direction given exceeded the Postmaster-General's authority (p.581) and the plaintiff was entitled to the declaration and injunctions. Menzies J. who dissented, approached the issue in the same way when he said at p.585 "To succeed in these proceedings for a declaration of right and an injunction, the plaintiff must establish a legal duty binding the Commonwealth and the Postmaster-General to provide him with the postal and telegraphic facilities of the Post Office." I would paraphrase the present application for a declaration and injunction as follows:
    "The plaintiff must establish a duty in contract binding on
    the defendants to continue the method and form of making
    Union payroll deductions exactly as has been done up to 1st
    April 1994".

48. As I said above, the plaintiff has failed to establish that duty, and in any event there is no breach of contract in what is proposed for the future in the manner proposed for the future. Even if I am wrong in the above, I am of the opinion that my discretion should not be exercised for either form of equitable relief claimed in the summons: the declaration and/or injunction. The form of equitable relief claimed by way of injunction is in substance "to translate into negative language the affirmative obligation created by" the allegation that clause 7(c) (last sentence) obliges the defendants to maintain precisely the manner and form of deducting union dues from the fortnightly payroll. This is in reality seeking an order that the defendants continue the existing practice, procedure, manner and form of making union dues deductions. It is in effect seeking specific performance of the Treasurer's instructions
(406) which is not contained in the Framework Agreement. The injunction is in reality a mandatory order; see Spry on Equitable Remedies, 3rd ed. pp.338-344 and at 505 footnote 2 (last paragraph) and 508-509 as to the requirements for granting mandatory injunction. Section 7(2) of the Crown Proceedings Act may well prevent such an order being made in this case.

49. I should add that I also accept Mr Bleby Q.C.'s argument that the Treasurer's instructions (406) were given under s.41 of the Public Finance and Audit Act 1987, concerning the proper financial administration of the State and cannot be overridden by an industrial agreement. Furthermore there is no equivalent to s.77 of the Government Management and Employment Act in respect of Treasurer's instructions. I should not exercise my discretion to grant an injunction in those circumstances.

50. For these reasons I am: a) not satisfied that the defendants are bound to continue making the deductions in the same way as the Framework Agreement (clause 7(c)) alleges; nor b) satisfied that the defendants are now or will be if the Minister's statements are carried out as he announced they would be, in breach of the Framework Agreement; and c) that the plaintiff has not established any right in fact nor in law for either the Declaration sought or the injunction; d) that the particular injunction sought is prohibited by s.7(2) of the Crown Proceedings Act, and e) That in any event I should not exercise my discretion to grant either the declaration or the injunction. The summons is dismissed.