ResMed Limited v The Australian Manufacturing Workers' Union (AMWU)
[2014] FWCFB 2418
•11 APRIL 2014
[2014] FWCFB 2418 |
FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.604 - Appeal of decisions
v
The Australian Manufacturing Workers' Union (AMWU)
(C2014/2556)
VICE PRESIDENT HATCHER | SYDNEY, 11 APRIL 2014 |
Appeal against decision [2013] FWC 9725 of Commissioner Bull at Sydney on 19 December 2013 in matter number B2013/742.
Introduction
[1] ResMed Limited (ResMed) has appealed a decision of Commissioner Bull issued on 19 December 2013 1 (Decision) in which he rejected a submission by ResMed that the Fair Work Commission (Commission) had no jurisdiction to hear and determine an application by the Australian Manufacturing Workers’ Union (AMWU) for a majority support determination in respect of a section of ResMed’s workforce at its Bella Vista site in Sydney.
[2] The AMWU’s application was made pursuant to ss.236 and 237 of the Fair Work Act 2009 (the Act), which provide:
236 Majority support determinations
(1) A bargaining representative of an employee who will be covered by a proposed single-enterprise agreement may apply to the FWC for a determination (a majority support determination) that a majority of the employees who will be covered by the agreement want to bargain with the employer, or employers, that will be covered by the agreement.
(2) The application must specify:
(a) the employer, or employers, that will be covered by the agreement; and
(b) the employees who will be covered by the agreement.
237 When the FWC must make a majority support determination
Majority support determination
(1) The FWC must make a majority support determination in relation to a proposed single-enterprise agreement if:
(a) an application for the determination has been made; and
(b) the FWC is satisfied of the matters set out in subsection (2) in relation to the agreement.
Matters of which the FWC must be satisfied before making a majority support determination
(2) The FWC must be satisfied that:
(a) a majority of the employees:
(i) who are employed by the employer or employers at a time determined by the FWC; and
(ii) who will be covered by the agreement;
want to bargain; and
(b) the employer, or employers, that will be covered by the agreement have not yet agreed to bargain, or initiated bargaining, for the agreement; and
(c) that the group of employees who will be covered by the agreement was fairly chosen; and
(d) it is reasonable in all the circumstances to make the determination.
(3) For the purposes of paragraph (2)(a), the FWC may work out whether a majority of employees want to bargain using any method the FWC considers appropriate.
(3A) If the agreement will not cover all of the employees of the employer or employers covered by the agreement, the FWC must, in deciding for the purposes of paragraph (2)(c) whether the group of employees who will be covered was fairly chosen, take into account whether the group is geographically, operationally or organisationally distinct.
Operation of determination
(4) The determination comes into operation on the day on which it is made.
[3] As can be seen, s.236(1) permits an application to be made in respect of a “proposed single-enterprise agreement”. There was no issue that the AMWU had proposed an agreement which was a single-enterprise agreement. Section 236(2)(b) requires an applicant for a majority support application to specify the employees who will be covered by the agreement which the applicant proposes to enter into with the employer. In its application, the AMWU identified the following categories of employees as those who would be covered by the proposed agreement:
“Employees of ResMed Limited who work at the Bella Vista site, who are covered by the Manufacturing and Associated Industries and Occupations Award 2010 and who are engaged as:
(a) Production Operators, Line Leaders or Line Coordinators in the Patient Interface work group; or
(b) Production Operators, Line Leaders or Line Coordinators in the Ventilation work group, or
(c) Production Operators, Line Leaders or Line Coordinators in the Machines work group; or
(d) Warehouse Operators, Line Leaders or Line Coordinators in the Warehouse work group; or
(e) An employee in the Manufacturing Equipment and Tooling Support (METS) work group who holds a trade certificate or equivalent, or who is undertaking an apprenticeship or traineeship, other than any team leader(s) and/or any employee who is engaged as a supervisor, manager or equivalent.
For the avoidance of doubt, any employee engaged as a team leader, supervisor, manager or equivalent will not be covered by the proposed enterprise agreement.”
[4] The AMWU contended that it had at least one member in each of the above five categories of employees. This was not factually disputed by ResMed at first instance or in this appeal. We will proceed on that factual premise.
[5] There was an issue in the hearing before the Commissioner as to whether the AMWU’s eligibility rule permitted it to enrol as members the employees specified in its application. ResMed submitted that none of the employees were eligible to be members of the AMWU, while the AMWU submitted that they all were. The Commissioner found that the employees in category (e) set out above were eligible to be members of the AMWU, but not employees in the other four categories. As a result of this finding, the Commissioner concluded that the AMWU was a bargaining representative for at least one employee to be covered by the proposed agreement. ResMed has not appealed the Commissioner’s finding that the AMWU had rules coverage of category (e), nor the Commissioner’s consequential conclusion that the AMWU was a bargaining representative under the Act for at least one employee to be covered by the proposed agreement. The AMWU has appealed the Commissioner’s findings that employees in categories (a) to (d) were not eligible to be its members. The AMWU’s appeal, because of its factual complexity, will be heard and determined separately to this appeal. This appeal is able to be determined on the assumption that the Commissioner’s finding that the AMWU’s coverage of ResMed’s employees extended to the employees in category (e) above only, and his consequential conclusion that the AMWU was a bargaining representative for at least one employee to be covered by the agreement, were correct.
[6] ResMed’s submission at first instance was that an application under s.236 could only validly be made by an employee organisation - that is, an organisation of employees registered under the Fair Work (Registered Organisations) Act 2009 2(the RO Act) - such as the AMWU if it had the capacity to enrol as members under its eligibility rules and therefore represent all those employees specified in the application who would be covered by the proposed agreement. The result of a finding that the AMWU’s eligibility rule did not permit it to enrol as members all the employees to be covered by the proposed single-enterprise agreement (that is, all the categories of employees specified in its application) had the consequence, ResMed submitted to the Commissioner, that the application was invalid and that the Commission had no jurisdiction to hear and determine it. The Commissioner rejected this submission. The reasoning of the Commissioner for this conclusion was as follows:
“[108] There is no dispute between the parties that an employee organisation can only be a bargaining representative for employees it may legitimately represent under its rules. This does not in my view support the extended proposition that an employee organisation may only propose an enterprise agreement for the purposes of a s.236 majority support determination, which covers employees whose industrial interests it is entitled to represent.
[109] It is not uncommon for enterprise agreements to cover more than one employee organisation. An acceptance of the ResMed proposition would preclude an employee organisation from making a s.236 application where the proposed agreement also covered employees it was not entitled to act for as their bargaining representative. To accept the argument that an employee organisation is statute barred from proposing an agreement to cover employees it may not have constitutional coverage of would mean that employee organisations are limited in comparison to other types of bargaining representatives in making applications under s. 236. This much is accepted by ResMed.
[110] Section 237 of the Act requires the Commission before making a majority support determination to be satisfied that the group of employees covered by the agreement was fairly chosen. This would provide an additional hurdle for majority support determination applications if the proposed agreement coverage could only relate to a union’s constitutional coverage as opposed to the employer’s enterprise generally.
[111] In my view, the matter is simply dealt with by disposing of the argument that in filing a s.236 application, an employee organisation is purporting to be the bargaining agent for all employees the proposed agreement would cover. The section requires the bargaining representative to specify the employees who will be covered by the agreement. There is no warrant to equate such specification regarding coverage of the agreement in the application, with the bargaining representative purporting to represent all the employees to be covered by the proposed agreement as their bargaining representative. In this case the AMWU are simply stating who should be covered by the proposed agreement, provided they are the bargaining representative of an employee who would be covered by the proposed agreement they have sufficient standing to make the application.
...
[113] This section cannot be read as imposing a requirement that an employee organisation is restricted to proposing an agreement to cover only employees it is entitled to represent. If such was the case it would provide bargaining representatives who are not employee organisations and not bound by eligibility rules the right to propose an agreement covering an employer’s workforce unrestrained by any limitation on coverage. Or in the alternative only being able to propose an agreement to cover the employee/s that had appointed the bargaining representative to act on their behalf, either outcome cannot be supported from a plain reading of s.236.
[114] While ss. 176 and 236 both refer to the “proposed” agreement and this term should be given the same meaning in both sections unless the Act indicates otherwise, I am unable to agree that s.176 limits s.236 to the extent that is put on behalf of ResMed.”
Submissions
[7] ResMed submitted that the Decision was affected by jurisdictional error and should be quashed, and that the AMWU’s application should be dismissed, for the following reasons:
(1) The Commissioner failed to have proper regard for the general law principles concerning the legitimate field of operations of employee organisations established by the High Court in decisions such as R v Williams; Ex parte Australian Building Construction Employees’ and Builders Labourers Federation 3, R v Dunlop Rubber Australia Ltd; Ex parte Federated Miscellaneous Workers’ Union of Australia4, R v Clarkson; Ex parte Victorian Employers’ Federation5, R v Aird; Ex parte The Australian Workers’ Union6 and R v Cohen; Ex parte Motor Accidents Insurance Board7. Those decisions establish that the eligibility rules of an employee organisation determine its right to enrol and represent the industrial interests of a particular class of employees.
(2) In interpreting ss.236 and 237, the Commissioner failed to have regard to the principle of statutory construction that in the absence of a clear intention to the contrary, the legislation cannot be presumed not to have altered the common law. The Commissioner should have interpreted ss.236 and 237 consistent with the High Court decisions earlier referred to.
(3) In making an application for a majority support determination, an employee organisation is seeking to represent the industrial interests of all employees who will be covered by the proposed agreement, in that the employee organisation is standing or acting in the place of the employees to advance the proposition that a majority of them wish to bargain with their employer. In doing so, it is purporting to represent their interests, those interests being to obtain a determination requiring their employer to commence bargaining with them. Sections 236 and 237 should therefore, consistent with the general law principles in the High Court decisions referred to, be construed as preventing an employee organisation from making an application for a majority support determination in relation to a proposed agreement that would cover employees for whom it does not have coverage.
(4) The Full Bench decision in Australian and International Pilots Association v Network Aviation Pty Limited 8, which concerned the capacity of an employee organisation to make an application for bargaining orders under s.229 of the Act, supported that construction. In that case, an employee organisation was held not to be able to make such an application because, by reason of its eligibility rules, it could not represent the industrial interests of the employees to be covered by the proposed enterprise agreement.
(5) The Commissioner also failed to take a purposive and contextual approach to the construction of ss.236 and 237 consistent with the principles of statutory construction stated by the High Court in decisions such as Certain Lloyd’s Underwriters Subscribing to Contract No IH00AAQS v Cross 9and Project Blue Sky Inc v Australian Broadcasting Authority10. The purpose of Part 2-4 of the Act, in which ss.236 and 237 are located, is the facilitation of bargaining being conducted in an orderly manner. That purpose must operate consistently with the system for the registration of employee organisations and the limitations placed by the industrial relations system on such organisations. Those limitations include the requirement in s.176 of the Act that an employee organisation cannot be a bargaining representative of an employee unless it is entitled to represent the industrial interests of that employee.
(6) Section 176 should be interpreted as meaning that an employee organisation cannot propose an agreement in relation to employees who are not eligible for membership, consistent with the limitations upon the representative capacity of such organisations. Sections 236 and 237 should not be construed as permitting the statutory mechanism to require an employer to bargain to be used by an employee organisation to act outside its legitimate field of operations as prescribed by its eligibility rule.
(7) Applying the principles stated in Project Blue Sky Inc concerning the consequences of an action taken in non-compliance with the provisions of a statute, the AMWU’s application should be treated as invalid.
[8] The AMWU submitted that the Commissioner had correctly construed ss.236 and 237, and advanced the following propositions in support of the Commissioner’s construction:
(1) As long as an employee organisation was properly a bargaining representative for one employee who would be covered by the proposed agreement, the question of the scope of the eligibility rules did not arise, and the organisation was entitled to make an application under s.236.
(2) An organisation in making such an application does not represent or seek to represent employees who would be covered by the proposed agreement for whom it does not have coverage. The jurisprudence referred to by ResMed concerning the role of eligibility rules therefore has no relevance.
(3) The approach taken by the Commissioner to the construction of ss.236 and 237 was conventional, in that he gave effect to the plain meaning of the language used in the provisions properly read in the context of the Act as a whole. Section 236(1) permitted an application to be made by a bargaining representative “of an employee who will be covered by a proposed single-enterprise agreement”. The use of the singular “an employee” in contrast to the reference to “employees” in s.236(2)(b), demonstrates that a bargaining representative who represents a single employee may make an application with respect to a wider group of employees.
(4) The requirement in s.237(2)(c) for the employees to be covered by the proposed agreement to be “fairly chosen” was unlikely to be satisfied if the group of employees was identified by reference to union membership or nomination of a particular bargaining representative.
(5) ResMed’s submission involved the impermissible rewriting of s.236 to add a limitation which was simply not available.
Consideration
[9] It is necessary to observe at the outset that ResMed’s submissions require s.236 to be read as if it contained words which are not there. On the ordinary meaning of the language used in the Act, the AMWU was entitled to make an application for a majority support determination under s.236 if it was a “bargaining representative of an employee who will be covered by a proposed single-enterprise agreement”. Section 176 identifies who are “bargaining representatives” for a proposed enterprise agreement that is not a greenfields agreement. It relevantly provides:
176 Bargaining representatives for proposed enterprise agreements that are not greenfields agreements
Bargaining representatives
(1) The following paragraphs set out the persons who are bargaining representatives for a proposed enterprise agreement that is not a greenfields agreement:
(a) an employer that will be covered by the agreement is a bargaining representative for the agreement;
(b) an employee organisation is a bargaining representative of an employee who will be covered by the agreement if:
(i) the employee is a member of the organisation; and
(ii) in the case where the agreement is a multi-enterprise agreement in relation to which a low-paid authorisation is in operation--the organisation applied for the authorisation;
unless the employee has appointed another person under paragraph (c) as his or her bargaining representative for the agreement, or has revoked the status of the organisation as his or her bargaining representative for the agreement under subsection 178A(2); or
(c) a person is a bargaining representative of an employee who will be covered by the agreement if the employee appoints, in writing, the person as his or her bargaining representative for the agreement;
(d) a person is a bargaining representative of an employer that will be covered by the agreement if the employer appoints, in writing, the person as his or her bargaining representative for the agreement.
Bargaining representatives for a proposed multi-enterprise agreement if a low-paid authorisation is in operation
(2) ....
(3) Despite subsections (1) and (2):
(a) an employee organisation; or
(b) an official of an employee organisation (whether acting in that capacity or otherwise);
cannot be a bargaining representative of an employee unless the organisation is entitled to represent the industrial interests of the employee in relation to work that will be performed under the agreement.
Employee may appoint himself or herself
(4) To avoid doubt and despite subsection (3), an employee who will be covered by the agreement may appoint, under paragraph (1)(c), himself or herself as his or her bargaining representative for the agreement.
[10] The effect of s.176(1) is that an employee organisation is the bargaining representative of a member of that organisation who will be covered by a proposed enterprise agreement unless the member has nominated another person to be his or her bargaining representative under s.176(1)(b) or has revoked the status of the organisation as a bargaining representative under s.178A(2). There was no suggestion in these proceedings that any member of the AMWU employed by ResMed had done either of those things such as to displace the default status of the AMWU as his or her bargaining representative. Section 176(1)(b) operates subject to s.176(3), which provides that an employee organisation may not be a bargaining representative of an employee in relation to work that will be performed under the agreement unless the organisation is “entitled to represent the industrial interests of the employee” in relation to work that would be performed under the agreement. The expression “entitled to represent the industrial interests of the employee” and similar expressions are used in a large number of provisions in the Act in relation to the rights of employee organisations. The Act does not expressly define when an employee organisation is entitled to represent the industrial interests of employees, but the parties’ submissions proceeded on the premise that such an entitlement only arises when the organisation’s eligibility rules permit it to enrol as members the relevant employees. That is the way the issue has been approached in a number of Federal Court decisions 11 and accordingly for the purpose of this decision we will proceed on the same basis.
[11] The Commissioner’s finding, not challenged by ResMed, that the AMWU was entitled under its eligibility rules to enrol as members employees in category (e) of the categories of ResMed employees identified in the AMWU’s application as those to be covered by the proposed agreement, together with the unchallenged fact that the AMWU had at least one member in category (e), meant that the AMWU was a bargaining representative for that member under s.176. It was therefore a bargaining representative of “an employee” who will be covered by a proposed single-enterprise agreement. On the ordinary meaning of s.236(1), that meant the AMWU had standing to make an application for a majority support determination under s.236.
[12] To overcome this result, ResMed’s submissions require s.236(1) to be read as if, in addition to the requirement for an applicant to be “a bargaining representative of an employee who will be covered by a proposed single-enterprise agreement”, it contained a further requirement not stated in the text, namely that if the applicant was an employee organisation, it had to have the right to represent the industrial interests of all employees who will be covered by the proposed single-enterprise agreement.
[13] This would involve a major departure from the usual approach to statutory construction. The correct approach was concisely stated by the High Court in Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue 12as follows:
“This Court has stated on many occasions that the task of statutory construction must begin with a consideration of the text itself. Historical considerations and extrinsic materials cannot be relied on to displace the clear meaning of the text. The language which has actually been employed in the text of legislation is the surest guide to legislative intention. The meaning of the text may require consideration of the context, which includes the general purpose and policy of a provision, in particular the mischief it is seeking to remedy.”
[14] There may be cases where a statutory provision needs to be construed as if it contained additional words. However, the circumstances in which that may be done are restricted and rare. In R v Young 13, a decision of the NSW Court of Appeal, Spigelman CJ said:
“[5] The proposition that a court can introduce words into an Act of Parliament offends a fundamental principle of our constitutional law. It is no part of the function of any judge to amend legislation. The task of the courts is to determine what Parliament meant by the words it used, not to determine what Parliament intended to say...
[6] In order to construe the words actually used by Parliament, it is sometimes necessary to give them an effect as if they contained additional words. This is not, however, to introduce words into the Act. This involves the construction of the words actually used. Judicial statements which appear to have been prepared to countenance something more than this, should be so understood.
[7] The most frequently cited formulations are:
"It is a strong thing to read into an Act of Parliament words which are not there, and in the absence of clear necessity it is a wrong thing to do". (Thompson v Goold & Co [1910] AC 409 at 420 per Lord Mersey)
and
"...we are not entitled to read words into an Act of Parliament unless clear reason for it is to be found within the four corners of the Act itself". (Vickers, Sons & Maxim Ltd v Evans [1910] AC 444 at 445 per Lord Loreburn LC)
To similar effect is the following formulation:
"Additional words ought not to be read into a statute unless they are required in order to make the provision intelligible". (Wills v Bowley [1983] 1 AC 57 at 78B)
[8] The process by which words omitted by inadvertence on the part of the draftsperson may be supplied by the Court, must remain capable of characterisation as a process of construction of the words actually used.
[9] The contemporary approach is as set out by Lord Diplock in Wentworth Securities v Jones [1980] AC 74 at 105-107:
"My Lords, I am not reluctant to adopt a purposive construction where to apply the literal meaning of the legislative language used would lead to results which would clearly defeat the purposes of the Act. But in doing so the task on which a court of justice is engaged remains one of construction; even where this involves reading into the Act words which are not expressly included in it. Kammins Ballrooms Co Ltd v Zenith Investments (Torquay) Ltd [1971] AC 850 provides an instance of this; but in that case the three conditions that must be fulfilled in order to justify this course were satisfied. First, it was possible to determine from a consideration of the provisions of the Act read as a whole precisely what the mischief was that it was the purpose of the Act to remedy; secondly, it was apparent that the draftsman and Parliament had by inadvertence overlooked, and so omitted to deal with, an eventuality that required to be dealt with if the purpose of the Act was to be achieved; and thirdly, it was possible to state with certainty what were the additional words that would have been inserted by the draftsman and approved by Parliament had their attention been drawn to the omission before the Bill passed into law. Unless this third condition is fulfilled any attempt by a court of justice to repair the omission in the Act cannot be justified as an exercise of its jurisdiction to determine what is the meaning of a written law which Parliament has passed. Such an attempt crosses the boundary between construction and legislation. It becomes a usurpation of a function which under the constitution of this country is vested in the legislature to the exclusion of the courts."
...
[11] The three conditions set out by Lord Diplock should not be misunderstood. His Lordship did not say, nor do I take any of their Honours who have adopted the passage to suggest, that whenever the three conditions are satisfied, a court is at liberty to supply the omission of the legislature. Rather, his Lordship was saying that in the absence of any one of the three conditions, the court cannot construe a statute with the effect that certain words appear in the statute.
[12] As I understand the recent cases, they are not authority for the proposition that a court is entitled, upon satisfaction of the three conditions postulated by Lord Diplock, to perfect the Parliamentary intention by inserting words in a statute. The court may construe words in the statute to apply to a particular situation or to operate in a particular way, even if the words used would not, on a literal construction, so apply or operate. However, the words which actually appear in the statute must be reasonably open to such a construction. Construction must be text based.”
[15] The issue raised by Spigelman CJ’s judgment in R v Young, as well as the judgment itself, was considered by the High Court majority (French CJ, Crennan and Bell JJ) in Taylor v The Owners - Strata Plan No 11564. 14 Their Honours said (footnotes omitted):
“[38] The question whether the court is justified in reading a statutory provision as if it contained additional words or omitted words involves a judgment of matters of degree. That judgment is readily answered in favour of addition or omission in the case of simple, grammatical, drafting errors which if uncorrected would defeat the object of the provision. It is answered against a construction that fills "gaps disclosed in legislation" or makes an insertion which is "too big, or too much at variance with the language in fact used by the legislature".
[39] Lord Diplock's three conditions (as reformulated in Inco Europe Ltd v First Choice Distribution (a firm))accord with the statements of principle in Cooper Brookes and McColl JA was right to consider that satisfaction of each could be treated as a prerequisite to reading s 12(2) as if it contained additional words before her Honour required satisfaction of a fourth condition of consistency with the wording of the provision. However, it is unnecessary to decide whether Lord Diplock's three conditions are always, or even usually, necessary and sufficient. This is because the task remains the construction of the words the legislature has enacted. In this respect it may not be sufficient that "the modified construction is reasonably open having regard to the statutory scheme" because any modified meaning must be consistent with the language in fact used by the legislature. Lord Diplock never suggested otherwise. Sometimes, as McHugh J observed in Newcastle City Council v GIO General Ltd,the language of a provision will not admit of a remedial construction. Relevant for present purposes was his Honour's further observation, "[i]f the legislature uses language which covers only one state of affairs, a court cannot legitimately construe the words of the section in a tortured and unrealistic manner to cover another set of circumstances."
[40] Lord Diplock's speech in Wentworth Securities laid emphasis on the task as construction and not judicial legislation. In Inco Europe Lord Nicholls of Birkenhead observed that even when Lord Diplock's conditions are met, the court may be inhibited from interpreting a provision in accordance with what it is satisfied was the underlying intention of Parliament: the alteration to the language of the provision in such a case may be "too far-reaching". In Australian law the inhibition on the adoption of a purposive construction that departs too far from the statutory text has an added dimension because too great a departure may violate the separation of powers in the Constitution.”
[16] ResMed’s submissions essentially involved the propositions that a literal construction of s.236(1) did violence to the established principle that employee organisations could only act in respect of present and future members eligible to join the organisation under its rules and therefore that it was necessary to read s.236(1) as if it contained the additional requirement referred to in order to ensure consistency with that principle. Those propositions were founded on the premise that when an employee organisation acting as a bargaining representative makes an application under s.236, it is acting in a representative capacity on behalf of not only those employees for whom it is a bargaining representative but also all other employees who would be covered by the proposed agreement.
[17] We do not accept that premise. It is not supported by an analysis of the function and purpose of majority support determinations in the scheme of enterprise bargaining established by the Act. That function and purpose was characterised by a Full Bench of Fair Work Australia in MSS Security Pty Ltd v Liquor, Hospitality and Miscellaneous Union 15 the following way:
“[16]An employer is not obliged to agree to bargain or to commence bargaining for an enterprise agreement in response to a union or other employee bargaining representative proposing an enterprise agreement. An employer can refuse to bargain for an enterprise agreement or can make its agreement to commence bargaining subject to a condition precedent as to the scope of any agreement. If the union or other employee bargaining representative does not accept that condition precedent as to scope, the employer is entitled to refrain from bargaining or agreeing to bargain and the employee bargaining representative’s remedy is to seek a majority support determination under s.236 of the FW Act. When such a determination is made the employer is obliged to bargain in good faith for an agreement in accordance with the good faith bargaining requirements of the FW Act: see s.228(1). Of course, s.228(2) makes it plain that the employer is not required to make concessions during bargaining for the agreement or to reach agreement on the terms that are to be included in the agreement.”
[18] The primary purpose of ss.236 and 237 is therefore to provide a bargaining representative with a means by which an employer which refuses to bargain may be required to bargain (by opening the door to the operation of the good faith bargaining requirements in s.228 or by enabling bargaining orders to be applied for and made under ss.229-232). It was succinctly described in the Federal Court Full Court decision in J.J. Richards & Sons Pty Ltd v Fair Work Australia as “a means by which a party seeking to bring an employer to the bargaining table may achieve that result without taking industrial action”. 16
[19] Under s.237(1), the Commission is required to make a majority support determination if satisfied as to the matters set out in s.237(2). The first of those matters in s.237(2)(a) is that the Commission must be satisfied that the majority of the employees to be covered by the agreement “want to bargain”. Section 237(3) provides that the Commission may use any method it considers appropriate to assess that matter. In essence, that involves the Commission testing whether the desire of the applicant bargaining representative to commence negotiations for a proposed enterprise agreement is supported by the majority of employees to be covered by that agreement.
[20] In applying and advocating for the making of a majority support determination, it is possible that a bargaining representative, including but not limited to an employee organisation, may positively seek to persuade the Commission by evidence and submissions that there is majority support for bargaining. It is not necessary however for the applicant to present a case of this nature in respect of the s.237(2)(a) requirement; it may for example simply request the Commission to conduct a ballot of employees. In either situation, it is incorrect for a number of reasons to characterise the applicant as in some way acting as representative of all employees, or even a majority of them. Firstly, the scheme for bargaining representatives established by s.176 itself prescribes when a particular person or organisation is acting as a representative for particular employees for the purpose of bargaining, so that it would create an inconsistency in the scheme to treat applicant bargaining representatives under s.236 as acting on behalf of all employees including employees for whom they are not bargaining representatives. Secondly, the fact that only majority support, not unanimous support, is required, contemplates that even in respect of a successful majority support determination application there may be a minority (substantial or otherwise) which does not want bargaining to occur. In that circumstance, the notion that the applicant seeking the commencement of bargaining is to be taken as representing or acting in the interests of all employees is nonsensical. Thirdly, it would be entirely unnecessary for the Commission to be required under s.237(2)(a) to test whether there is majority support for bargaining if the applicant was taken to be representing all employees in seeking the commencement of bargaining. The fact of that representation would effectively answer the question posed by s.237(2)(a) and make further inquiry unnecessary.
[21] There is no reason for an applicant bargaining representative under ss.236 and 237 to be treated as acting on behalf of any employee apart from those employees the applicant is authorised under s.176 to represent. If those employees want to bargain with their employer for an enterprise agreement covering the entire enterprise or a geographically, operationally or organisationally distinct part of it, and the employer refuses to bargain, a bargaining representative will act in the interests of those employees consistent with s.176 by making an application under s.236(1). There is therefore no discordance between the express language of s.236(1) and the bargaining representative provisions in s.176. Section 176 itself (in particular s.176(3)) operates consistently with the general principle that employee organisations are limited by their eligibility rules as to the employees whose industrial interests they can represent. Section 236(1), interpreted in accordance with the plain meaning of the words used, operates harmoniously with the legislative purpose for the establishment of the majority support determination mechanism and the other relevant provisions of Part 2-4 of the Act. The criteria stated in R v Young and Taylor for reading a statute as if it omitted certain words are not met here.
[22] There is also no warrant to read into s.236(1) an additional limitation concerning the capacity of bargaining representatives to make an application for a majority support determination based on the line of authority which includes Williams, Dunlop Rubber, Clarkson, Aird and Cohen. Those authorities concerned the capacity of registered employee organisations to make claims such as give rise to an “industrial dispute” under Commonwealth industrial relations legislation founded upon the industrial disputes power in s.51(xxxv) of the Constitution. They are therefore necessarily concerned with the constitutional concept of an industrial dispute. In this respect, the High Court said in Dunlop Rubber:
“The question whether in these circumstances a dispute has been created covering the work of employees engaged in the manufacture of such products must, it would seem, depend on the true application of the doctrine or principle first enunciated in the case of the Burwood Cinema Ltd. v. Australian Theatrical and Amusement Employees' Association, namely the doctrine or principle that an organisation stands for or represents an industrial group so that by disagreeing with the representative or members of another industrial group the organisation may cause the condition to be fulfilled which is expressed in the words of s.51(xxxv) of the Constitution and on fulfilment of which the authority of the conciliation commissioner must rest.”
[23] The scheme for enterprise bargaining in Part 2-4 of the Act is not founded on s.51(xxxv) of the Constitution. The scheme in general is expressed in highly detailed and prescriptive terms, and leaves little if any room for the implication of rights, obligations or requirements not expressly found therein. The role of employee organisations registered under the RO Act in that scheme is also tightly prescribed; for example, s.172(1) provides that an enterprise agreement may be about matters pertaining to the relationship between an employer and an employee organisation that will be covered by the agreement, s.183 identifies the circumstances in which an employee organisation is entitled to have an enterprise agreement cover it, s.223(d) provides that the Commission must take into account the views of any employee organisation covered by an enterprise agreement in considering whether to terminate the agreement, and s.256A specifies how an employee organisation is to be described in an enterprise agreement which covers it.
[24] In the context of bargaining for enterprise agreements, Part 2-4 identifies with precision the circumstances in which employee organisations may become involved in the process. In respect of greenfields agreements, employers may enter into the agreement with one or more “relevant employee organisations” (see s.172(2)(b) and (3)(b)), that expression being defined in s.12 as meaning “an employee organisation that is entitled to represent the industrial interests of one or more of the employees who will be covered by the agreement, in relation to work to be performed under the agreement”. There is an additional requirement that, in order for the Commission to approve such an agreement, the relevant organisations must be entitled to represent the industrial interests of a majority of the employees to be covered by the agreement in relation to the work performed under the agreement (s.187(5)(a)). These express requirements identify the extent to which the role of any employee organisation is circumscribed by the scope of its eligibility rule.
[25] In relation to participation in bargaining for other types of enterprise agreements, the central concept in Part 2-4 is that of the bargaining representative. Thus it is in relation to bargaining representatives that the good faith bargaining requirements in s.228 apply, and it is bargaining representatives who may apply for approval of enterprise agreements (s.185(1)), bargaining orders (s.229(1)), serious breach declarations (s.234), majority support determinations (s.236(1)), scope orders (s.238(1)), for the Commission to deal with a bargaining dispute (s.240(1)) and low paid authorisations (s.242(1)). 17 In addition, in the related scheme for the taking of protected industrial action in Part 3-3 of the Act, it is bargaining representatives of employees who may make application for the protected action ballot orders which are a necessary precursor to the taking of protected industrial action (s.437(1)).
[26] We have earlier referred to ss.176 and 178A, which read together identify who are the bargaining representatives for employees and employers to be covered by an enterprise agreement. Section 178 in addition specifies certain matters concerning instruments of appointment of bargaining representatives. In the way earlier explained, s.176 prescribes the circumstances in which employee organisations may become bargaining representatives, and s.176(3) in particular imposes a limitation upon employee organisations in that respect by reference to their industrial capacity to represent employees under their eligibility rules.
[27] Given therefore that the legislature in the provisions of the Act we have identified deal expressly and specifically with the role of employee organisations in enterprise bargaining, including limitations upon that role based upon their eligibility rules, we do not consider that orthodox rules of statutory construction provide any basis for the legislature to be taken to have intended that there be a further limitation based upon the line of authority represented by Williams, Dunlop Rubber, Clarkson, Aird and Cohen. Nor do we accept that express language was required to oust the applicability of that line of authority. While it is accepted that legislation will not be interpreted so as to interfere with common law rights unless a clear intention to do so is expressed, we do not consider that that principle has relevance here. The decisions referred to did not establish or declare common law rights, but as earlier stated were concerned with the operation of legislation based on the constitutional concept of the industrial dispute. Those decisions are not readily applicable to the very different context of Part 2-4 of the Act, and in any event for the reasons explained the intention of the legislature with respect to the role of employee organisations in enterprise bargaining is clearly expressed in the language used in the Act.
[28] We would add that the construction of s.236 advanced by ResMed would have a number of discordant results that could not have been intended by the legislature. Firstly, the limitation posited in respect of employee organisations would, on ResMed’s submissions, have no application or relevance to other bargaining representatives. Therefore, on ResMed’s approach, if an employee nominated himself or herself as his or her own bargaining representative but represented no other employee, that employee could apply for a majority support determination applicable to all employees to be covered by an enterprise agreement, but if the employee was represented by an employee organisation, the organisation could not make the same application if its eligibility rule did not cover all such employees. No logical or policy reason for this discriminatory result is apparent. Secondly, ResMed’s approach lends itself to an outcome in which the scope of operation of enterprise agreements would be shaped by the often archaic, confusing and/or arbitrary eligibility rules of relevant employee organisations. That outcome is difficult to reconcile with Part 2-4’s object, as stated in s.171(a), to “provide a simple, flexible and fair framework that enables collective bargaining in good faith, particularly at the enterprise level, for enterprise agreements that deliver productivity benefits”. Thirdly, it would be likely to be difficult to satisfy the “fairly chosen” requirement in s.237(2)(c), as elaborated by s.237(3A), if the scope of proposed enterprise agreements had to be drawn by reference to the eligibility rules of employee organisations.
[29] Finally, and for completeness, we reject the submission that the Full Bench decision in Australian and International Pilots Association v Network Aviation Pty Limited 18 aids the construction of s.236 advanced by ResMed. In that case, the Full Bench affirmed a decision at first instance that the appellant employee organisation could not make an application for bargaining orders under s.229 of the Act. The reason why that was found to be the case was because the employee organisation did not have the capacity by reason of its eligibility rules to represent the industrial interests of any employee to be covered by the proposed enterprise agreement, with the consequence that the organisation was not a bargaining representative by virtue of s.176(3) and could not therefore make an application under s.229(1). The decision is not authority for the proposition that an employee organisation which is a bargaining representative under s.176 is deprived of the capacity to make an application under s.229, or under any other provision in Part 2-4, because it does not have the capacity to represent the industrial interests of all the employees to be covered by the proposed enterprise agreement.
Conclusion and orders
[30] Because the arguments in ResMed’s appeal submissions were novel and raised issues of general application, we consider it appropriate and in the public interest to grant permission to appeal. We consider that the Commissioner’s Decision as to the AMWU’s capacity to apply for a majority support determination under s.236(1) of the Act was correct, and therefore the appeal cannot succeed.
[31] We order as follows:
(1) Permission to appeal is granted.
(2) The appeal is dismissed.
VICE PRESIDENT
Appearances:
A. Moses SC with T. Sebbens solicitor for ResMed Limited
C. Howell of counsel with L. Saunders for the Australian Manufacturing Workers’ Union
Hearing details:
2014.
Sydney:
17 March.
1 [2013] FWC 9725
2 See the definitions of “employee organisation” and “organisation” in s.12 of the Act.
3 (1982) 153 CLR 402
4 (1957) 97 CLR 71
5 (1973) 131 CLR 100
6 (1973) 129 CLR 654
7 (1979) 141 CLR 577
8 [2013] FWCFB 5216
9 (2012) 293 ALR 412
10 (1998) 194 CLR 355
11 CSBP Limited v Construction, Forestry, Mining and Energy Union [2011] FCA 917; Cozadinos v Construction, Forestry, Mining and Energy Union [2012] FCA 46 at [18]; Construction, Forestry, Mining and Energy Union v BMD Constructions Pty Ltd [2013] FCA 41 at [27];
12 (2009) 239 CLR 27 at 46 [47] per Hayne, Heydon, Crennan and Keiffel JJ, footnotes omitted.
13 (1999) 46 NSWLR 681
14 [2014] HCA 9
15 [2010] FWAFB 6519
16 [2012] FCAFC 53, 201 FCR 297 at [28] per Jessup J
17 In addition to “an employee organisation that is entitled to represent the industrial interests of an employee in relation to work to be performed under the agreement”.
18 [2013] FWCFB 5216
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