The Australian Workers' Union v Security International Services Group Pty Ltd (ABN 87 601 211 278)

[2017] FWC 4992

[2017] FWC 4992

FAIR WORK COMMISSION

DECISION

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

The Australian Workers' Union
v
Security International Services Group Pty Ltd (ABN 87 601 211 278)
(B2017/741)

COMMISSIONER CAMBRIDGE SYDNEY, 8 NOVEMBER 2017

Application for a majority support determination.

[1] On 16 August 2017, The Australian Workers’ Union (the AWU) made an application to the Fair Work Commission (the Commission) for a majority support determination. The application was made under section 236 of the Fair Work Act 2009 (the Act). The application sought a determination in respect to members of the AWU employed by Security International Services Group Pty Ltd (ABN 87 601 211 278) (the employer or SIS), and who are based at and perform work in relation to security at the BlueScope Steelworks at Port Kembla (relevant employees).

[2] The matter was initially listed for proceedings before the Commission on 25 August 2017. However, at the request of the AWU, the proceedings were rescheduled by consent to 4 September 2017. At the proceedings held on 4 September, the AWU was represented byMs R Walshtogether with Mr W Phillips. SIS was represented by Mr G Lindthe General Managerfor the employer.

[3] During the proceedings held on 4 September, Ms Walsh referred to material provided with the application as the grounds in support of the making of a majority support determination. Ms Walsh submitted that the copies of the exchange of communications between the AWU and SIS which were included with the application, clearly established the history of attempts to initiate enterprise bargaining in respect to the relevant employees.

[4] Ms Walsh also referred to a petition which had been provided to the Commission on a confidential basis, and which was signed by numerous individuals who were asserted to be relevant employees who had signed the petition indicating that they wanted to bargain for an enterprise agreement with SIS.

[5] Mr Lind advised that SIS was prepared to provide the Commission with a list of names of all of the relevant employees for the purposes of enabling the Commission to determine whether or not the petition provided by the AWU established that a majority of the relevant employees wanted to bargain for an enterprise agreement with the employer. Mr Lind also indicated that if the Commission was satisfied that the petition, when scrutinised against the list of names provided by SIS, established that a majority of the relevant employees wanted to bargain for an enterprise agreement, the application would be opposed on the basis that the relevant employees were not a group fairly chosen (s. 237 (2) (c)), and that in all the circumstances the application should be refused (s. 237 (2) (d)).

[6] On 7 September 2017, SIS provided the Commission with a list of the relevant employees. The Commission examined the petition provided by the AWU and cross-checked the signatories against the list of relevant employees provided by SIS. Following the examination of the documentary material provided by each side, on 13 September 2017, the Commission advised the Parties that a clear majority of identified relevant employees had signed the petition.

[7] Notwithstanding that a majority of the relevant employees had signed the petition, SIS maintained its opposition to the application upon the grounds that had been earlier indicated, namely, that the relevant employees were not a group fairly chosen (s. 237 (2) (c)), and that in all the circumstances the application should be refused (s. 237 (2) (d)). The Commission issued Directions for the Parties to file and serve all evidence and other material that each Party respectively relied upon regarding the contested questions arising under ss. 237 (2) (c) and 237 (2) (d) of the Act. Subsequently, these contested aspects of the application were the subject of a Hearing that was held on 23 October 2017.

[8] At the Hearing held on 23 October, Ms Walsh continued her appearance for the AWU, and she called Mr Phillips who, as a witness, attested to the veracity of two affidavits that he had made in respect to the application. Mr Phillips was cross-examined on his evidence by Mr Lindwho continued his appearance for SIS.

[9] SIS did not file or serve any evidentiary material in the form of witness statement, declaration, or affidavit, in respect to the contested questions arising under ss. 237 (2) (c) and 237 (2) (d) of the Act. Mr Lindprovided a Statutory Declaration dated 7 September 2017, made in connection with the identification of the individual employees who had signed the AWU petition, and he also filed and served two submission documents which contained much factual material. At the Hearing, the two submission documents, one which was signed by Mr Lind and dated 7^th September 2017, and the other which was unsigned and dated 10^th October 2017, were respectively marked as SIS1 and SIS2.

Evidence and Submissions on the Contested Questions

[10] There were two aspects of contest that arose from the objections to the application that were advanced by SIS. Firstly, SIS asserted that the relevant employees were not a group that was fairly chosen taking into account whether the group was geographically, operationally or organisationally distinct as mentioned in s. 237 (3A) of the Act. Secondly, a contest arose as to whether it was reasonable in all of the circumstances to make the majority support determination.

[11] The evidence provided by the witness for the AWU, Mr Phillips included certain largely uncontested historical material together with factually controversial material about the current operations of SIS which are based at the BlueScope Steelworks at Port Kembla (the BlueScope operations). The factual contests concerning the BlueScope operations were directed at whether the BlueScope operations are geographically, operationally or organisationally distinct from other of the SIS business operations around Australia.

[12] Ms Walsh submitted that the relevant employees were a group that had been fairly chosen because they were organisationally, operationally and geographically distinct. Ms Walsh submitted that there was an “industrial barrier” between the group chosen and the remainder of the workforce. It was submitted that the relevant employees were a group that was clearly organisationally and geographically distinguished by their work which was conducted at the BlueScope operations.

[13] Mr Lind challenged the evidence that had been provided by Mr Phillips. In particular, Mr Lind submitted that Mr Phillips had no direct knowledge of the issues regarding the organisational or operational aspects of the SIS operations generally, or at the BlueScope operations in particular. Mr Lind submitted that the SIS employees engaged at the BlueScope operations were not operationally or organisationally distinct.

[14] Mr Lind said that the AWU seemed to suggest that the Security Services Industry Award 2010 (the Award) was not a suitable basis for regulation of the employment of the relevant employees. Mr Lind referred to the uncontested evidence that the work of some of the relevant employees would involve work for up to eight clients of SIS other than BlueScope. Mr Lind also referred to roster, payroll, and accounting management systems which he said further confirmed that the relevant employees were not operationally or organisationally distinct. Mr Lind said that to deviate from the Award would disrupt these operating systems and add cost and complexity.

[15] Mr Lind further submitted that the SIS Group was currently under immense financial pressure, and that any additional cost pressures that would arise in respect of the BlueScope contract may not be sustainable. Mr Lind said that SIS was a law-abiding good corporate citizen which paid above Award wages, and this could be contrasted with a large element within the Security Industry that paid cash flat rates and engaged in unlawful practices which undermine the integrity of the Act and the Award. Mr Lind said that an enterprise agreement would raise the cost of business for SIS and this would be against the public interest.

[16] It was further submitted by Mr Lind that if the application for the majority support determination was approved it would “unleash an unstoppable force in the AWU against an unmoveable object in SIS Group.” Mr Lind submitted that the result would involve turmoil and damage to the SIS Group business, and also potentially affect the BlueScope business. Mr Lind referred to Full Bench Decisions which indicated that it was appropriate for the Commission to take into consideration the efficient operation of the employer’s business, and on this basis it would not be reasonable in all the circumstances to make the majority support determination sought by the AWU.

Consideration

[17] Despite the contested aspects of the evidence that was presented in this case, there was sound basis upon which to establish that the relevant employees were a group that is operationally and organisationally distinct. In any event, it appeared that there was no significant contest that the relevant employees were a group that was geographically distinct by virtue of being “assigned to the Bluescope Security & Emergency Services Team.” 1

[18] Although the evidence identified that there are aspects of the work performed by some of the relevant employees which are integrated with work for clients of SIS other than BlueScope, this integration does not negate or void the operational and organisational distinctiveness of the engagement of the relevant employees who are based at and perform work in relation to security at the BlueScope operations. There would be many instances where a distinct group of employees might be required to perform work which is ancillary or secondary to the primary functions which are fixed to the work undertaken as part of the distinct group.

[19] Further, in this instance it is important to recognise that there has been a history of industrial regulation of the work undertaken by the relevant employees, albeit involving the predecessor contractor to SIS (Serco), which involved enterprise agreements. Although, SIS has clearly adopted different management structures and other operational arrangements from those that were utilised by Serco, the fundamental security and emergency services provided to BlueScope have not altered as a result of the change in contractor from Serco to SIS.

[20] It is also relevant to examine the scope and application clauses of two enterprise agreements which covered Serco before SIS secured the contract to perform the BlueScope Port Kembla security and emergency services. Clause 1.2 of the Serco BlueScope Port Kembla Protective Services Agreement 2015 relevantly applied to “… all persons employed by Serco Australia Pty. Limited at its BlueScope contract at Port Kembla NSW…” While clause 1.2 of the Serco Illawarra Protective Services Agreement 2012 relevantly applied to “…all persons employed by Serco Australia Pty. Limited within the Illawarra Region (except at its Bluescope Steel contract in Port Kembla NSW)…”

[21] Therefore, the work performed by the relevant employees has historically been regulated by way of enterprise agreements which recognised the work to be of a clearly distinct basis. The position that SIS faces in respect to the application for a majority support determination is no different to that which would have confronted Serco when it first secured the contract to perform the security and emergency services at the BlueScope Port Kembla site. That is not to say that the proposed enterprise agreement negotiations would necessarily be confined to the historical scope arrangements, but this is a matter more for negotiation regarding the scope of any enterprise agreement rather than a basis to oppose a majority support determination.

[22] The application was also opposed on the basis that SIS asserted that the potential existed for certain financial detriment to arise which may threaten the viability of its business operations. These assertions were not supported with any actual evidence. Further, potential for any financial impacts of an enterprise agreement are matters that should properly be traversed during any enterprise bargaining negotiations. As was identified during the Hearing, there may be some prospect for the terms of any enterprise agreement to be mutually beneficial.

[23] Upon a balanced and objective consideration of the totality of the evidence and submissions, it is clear that the opposition to the application as advanced by SIS has primarily arisen from an earnest desire not to be involved in enterprise bargaining negotiations because of the potential disruption, inconvenience, and anticipated financial costs that may be associated with the bargaining process and any outcomes that it may deliver. Unfortunately for SIS, matters such as the inconvenience and potential costs associated with enterprise bargaining are not issues which could properly prevent the Commission from making a majority support determination.

[24] The evidence and submissions presented in this instance have not established that the relevant employees are a group that was not fairly chosen taking into account the geographical, operational and organisational distinction of the group. Further, in all of the circumstances, particularly whereby the work in question has historically been the subject of enterprise agreement coverage, it would be reasonable to make the majority support determination as has been sought by the AWU. Conversely, it would be manifestly unreasonable to deny the relevant employees the opportunity to bargain for an enterprise agreement in circumstances where the work that they perform has historically been covered by enterprise agreement regulation.

[25] Consequently, I am satisfied that; (a), a majority of the relevant employees want to bargain, and (b), the employer has not yet agreed to bargain, and (c), the group that comprises the relevant employees has been fairly chosen taking into account the geographical, operational and organisational distinction of that group, and (d), that it is reasonable in all circumstances to make the majority support determination. Therefore the relevant requirements of ss. 236 and 237 of the Act have been met and the application must be granted.

[26] Consequently, the Commission has separately issued a majority support determination.

[27] This majority support determination operates on and from today, 8 November 2017.

COMMISSIONER

Appearances:

Ms R Walsh with Mr W Phillips appeared for The Australian Workers' Union.

Mr G Lind appeared for Security International Services Group Pty Ltd.

Hearing details:

2017.

Sydney:

October, 23.

 1   Exhibit 2 - Attachment “WP-4”.

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