The Australian Workers' Union v WesTrac Pty Ltd

[2019] FWC 5111

[2019] FWC 5111

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739 - Application for the Fair Work Commission to deal with a dispute in accordance with a Dispute Settlement Procedure

The Australian Workers' Union
v
WesTrac Pty Ltd
(C2019/2954)

COMMISSIONER CAMBRIDGE SYDNEY, 1 AUGUST 2019

Dispute settlement procedure - dispute about whether industrial action was protected or unprotected - jurisdictional objection - no agreement as to question for determination - dispute did not involve interpretation of terms of enterprise agreement or matter that would otherwise provide jurisdiction under s. 739 - finding regarding issue in dispute made - application dismissed.

[1] This Decision is made in respect of an application that was taken under section 739 of the Fair Work Act 2009 (the Act) for the Fair Work Commission (the Commission) to deal with a dispute in accordance with a Dispute Settlement Procedure (DSP). The application was lodged at Sydney on 8 May 2019, and it was made by The Australian Workers’ Union (the AWU or the Union), and taken against WesTrac Pty Ltd (the employer or WesTrac).

[2] The application was advanced pursuant to a DSP which can be found at clause 39 of the WesTrac Pty Ltd (NSW and ACT Product Support) Enterprise Agreement 2017 (the Agreement). There was no argument that the relevant procedural requirements of the DSP contained in the Agreement had not been followed. However, WesTrac asserted, inter alia, that the Commission was not properly empowered to determine the issue of contest identified in the application.

[3] The application was the subject of unsuccessful conciliation proceedings held on 14 May 2019. The matter has subsequently advanced to arbitration proceedings which involved a Hearing conducted in Sydney on 15 July 2019.

[4] At the Hearing, the Commission reaffirmed that permission was granted, pursuant to s. 596 of the Act, for the Parties to be represented by lawyers or paid agents. Mr T Craven, Industrial Officer, appeared for the AWU, and the employer was represented by Mr S Amendola solicitor, from K&L Gates, and he was accompanied by Mr D DeBijl from WesTrac. Neither Mr Craven nor Mr Amendola introduced any witness evidence.

[5] Mr Craven and Mr Amendola both made oral submissions in elaboration of documentary material that each had filed on behalf of the respective Parties.

Background

[6] There was essentially no factual contest between the Parties about the circumstances which gave rise to the dispute in this matter.

[7] The relevant factual circumstances have involved an event that occurred on 9 April 2019, when three employees of WesTrac took industrial action which involved strike action for a lesser duration than the period that had been notified by the AWU.

[8] The Agreement has passed its nominal expiry date, and in the pursuit of a replacement agreement, the AWU has been involved in a campaign of taking protected industrial action conducted in accordance with an Order of the Commission made on 11 January 2019, in The Australia Workers’ Union of Australia v WesTrac Pty Ltd [2019] FWC 150, (the PABO Decision). Relevantly, on 2 April 2019, the AWU provided WesTrac with a Notice of intention to take employee claim action as required by s. 414 of the Act (the Notice). The Notice broadly conformed with the terms established in the PABO Decision and it relevantly included the following terms:

“Commencing in [sic] Tuesday 9 April 2019, a four-hour work stoppage for the last four hours of all rostered shift [sic] (including shifts starting on Tuesday and moving into Wednesday).”

[9] On 9 April, three employees of WesTrac (the relevant employees) did not participate in the full four hour stoppage but instead stopped work for lesser periods; in one case, an individual stopped work for 2 hours, and in the other two cases the individuals both stopped work for 3 ½ hours. WesTrac considered that as the relevant employees had stopped work for a lesser period than that which was notified by the AWU, their stoppages of work did not conform with the Notice, and consequently it determined that these individuals had taken unprotected industrial action.

[10] WesTrac then invoked the provisions of s. 474 (1) (b) of the Act which require that if unprotected industrial action of less than four hours duration is taken, an employer must not make payment to an employee in relation to that action of a minimum of four hours. The result was that WesTrac paid each of the relevant employees four hours in respect of their engagement on 9 April 2019, despite each of the relevant employees having performed work for more than four hours on that day.

[11] The AWU asserted that the failure of WesTrac to pay the relevant employees for all of the time that they worked on 9 April breached clause 22 of the Agreement which deals with payment of wages. The AWU communicated with WesTrac and sought payment of what it said represented the legal entitlement of the relevant employees to wages for all time worked on 9 April 2019. WesTrac rejected the AWU’s assertion that the relevant employees were entitled to what amounted to an alleged underpayment, and it insisted that s. 474 (1) (b) of the Act required it to make a deduction of four hours payment in respect to the unprotected industrial action of the relevant employees.

[12] The AWU subsequently made the s. 739 application which was the subject of unsuccessful conciliation. The Parties were unable to agree upon an appropriate question to be the subject of determination by the Commission. WesTrac maintained that the issue in dispute could not be properly determined via the DSP as the Commission was not empowered by the DSP to determine what amounted to an underpayment of wages claim.

[13] The Commission issued Directions which provided a timetable for each side to file and serve evidence and respective submissions. Somewhat unusually, neither the AWU nor WesTrac presented any evidence, each side filed written submissions, and the AWU filed a Draft Order as the relief that it sought. Subsequently, at the request of the Commission, an Agreed Statement of Facts was filed.

The AWU Case

[14] In summary, the AWU has asserted that the question for the Commission to determine in this matter was whether the relevant employees must be paid for all rostered hours worked on 9 April 2019. In support of this assertion, the AWU submitted that WesTrac’s decision to deny wages to the relevant employees in respect to the work that they performed on 9 April 2019, represented a breach of clause 22 of the Agreement, and that this action of WesTrac further breached ss. 470, 323 and 324 of the Act.

[15] Mr Craven who appeared for the AWU made submissions which referred in detail to the Full Bench Decision in Thiess Pty Ltd v Construction, Forestry, Mining and Energy Union  1 (Thiess). Mr Craven submitted that WesTrac’s decision to treat the industrial action taken by the relevant employees on 9 April 2019 as unprotected industrial action was contrary to established law and in particular, the authoritative Decision of the Full Bench in Thiess.

[16] In this regard, it was submitted that individual employees such as the relevant employees, have the right to elect not to take the full period of the protected industrial action as had been notified by the AWU. Further, Mr Craven submitted that the action taken by the relevant employees was protected industrial action authorised by the relevant Notice, and the relevant employees simply didn’t take the full period of the notified industrial action.

[17] According to the submissions made by the AWU, the notification for the taking of industrial action, in the form of a four hour stoppage, encompassed the prospect that an individual might choose to participate for only a part of the period of the notified stoppage. The AWU submitted that the relevant employees, in taking stoppage action of less than four hours in duration, but otherwise in accordance with the notification, meant that the notification requirements had been met, and the industrial action was protected. In support of this submission, the AWU asserted that taking industrial action that involved a stoppage of lesser duration but otherwise in accordance with notification, satisfied the practical purpose for the notification which provided for the employer to have opportunity to take defensive action to deal with the consequences of the notified industrial action.

[18] Mr Craven submitted that any industrial action taken by the relevant employees on 9 April 2019 was protected industrial action, and therefore, WesTrac were wrong in its attempts to rely upon the terms of s. 474 the Act. Consequently, the AWU submitted that the Commission should determine that in accordance with clause 22 of the Agreement, the relevant employees must be paid for all rostered hours worked on 9 April 2019. Mr Craven urged the Commission to determine the application by making the Draft Order as sought by the AWU.

The WesTrac Case

[19] Mr Amendola appeared for WesTrac, and he made submissions in amplification of the written submissions which had been filed on behalf of the employer.

[20] The submissions made on behalf of WesTrac firstly raised a jurisdictional objection to the application. WesTrac submitted that the application, as had been articulated by the AWU, involved an alleged dispute about the operation of clause 22 of the Agreement, and that as clause 22 was a machinery provision that provided for payment of wages and allowances fortnightly and by EFT, WesTrac had, at all material times, complied with clause 22. Therefore, according to the submissions made on behalf of WesTrac, the dispute resolution provisions in clause 39 of the Agreement could not have been properly activated by any identified breach of clause 22 of the Agreement.

[21] The submissions made on behalf of WesTrac asserted that the issue in dispute about any requirement to pay the relevant employees in respect of work that they performed on 9 April 2019, involved an issue that required determination via the civil remedy provisions of the Act and was therefore beyond the jurisdiction of the Commission. Further, it was submitted that any decision or Order made by the Commission and which required WesTrac to make a payment to the relevant employees was beyond power and would be invalid.

[22] The submissions made by Mr Amendola also addressed the issue as to whether the relevant employees had taken unprotected industrial action on 9 April 2019. In this regard, it was acknowledged and accepted that employees were not obligated to participate in industrial action that had been notified by a bargaining representative, and individuals may choose not to participate in that action. However, according to the submissions made on behalf of WesTrac, an employee could not choose to participate in industrial action that was different to that which was provided for in the relevant Notice, and that is what had occurred in respect of the relevant employees and their action on 9 April 2019.

[23] WesTrac submitted that the Notice provided by the AWU for industrial action on 9 April 2019 involved a four-hour stoppage of work. According to the submissions made on behalf of WesTrac, as the AWU had not given any notice of a two hour stoppage of work, or a 3½ hour stoppage of work, the shorter duration industrial action taken by the relevant employees was not protected industrial action because it did not conform with the Notice.

[24] The submissions made by WesTrac focused upon the practical purpose for providing Notice of the taking of industrial action which was to allow an employer to take defensive action. WesTrac submitted that it could not be assumed that because the industrial action taken by the relevant employees which was of a lesser duration than the notified action, then the employer was able to take defensive action. Therefore, WesTrac submitted that the action taken by the relevant employees was not protected industrial action because it failed to comply with the Notice requirements.

[25] The submissions made by Mr Amendola also stressed that s. 474 (1) (b) of the Act established a clear and unequivocal requirement for the employer to deduct a minimum of four hours payment in respect to any period of unprotected industrial action that was of less than four hours duration. It was asserted that in this instance, where the action of the relevant employees was different from the industrial action that had been notified, it was not protected industrial action and the obligations on WesTrac arising under s. 474 (1) (b) were clear.

[26] In summary, Mr Amendola submitted that the Commission did not have jurisdiction to deal with the question that had been raised by the AWU under s. 739 of the Act as there was no dispute about the interpretation or application of clause 22 of the Agreement. Instead, it was submitted that the question regarding whether the action of the relevant employees on 9 April 2019 was protected or unprotected industrial action, involved something that was akin to a declaration as to the interpretation of the Act, and certainly not a matter that arose under the DSP in the Agreement. Consequently, Mr Amendola urged the Commission to dismiss the application and to make no findings in respect to the question of whether the action of the relevant employees was or was not protected industrial action.

[27] In the alternative, Mr Amendola reaffirmed the submissions that had been made in support of the decision of WesTrac to treat the industrial action taken by the relevant employees on 9 April 2019, to have been industrial action that was not protected industrial action because it was of a lesser duration than had been notified by the AWU.

Consideration

[28] The dispute in this instance has arisen from the decision of WesTrac to treat industrial action taken by the relevant employees on 9 April 2019, as unprotected industrial action, and therefore deduct the minimum of four hours payment as prescribed by s. 474 (1) (b) of the Act. The circumstances of the industrial action taken by the relevant employees on 9 April 2019 were, to the extent that it could be discerned, somewhat unusual. However, the subsequent contest about the industrial action taken by the relevant employees on 9 April 2019, and the respective positions that were advanced by both the AWU and WesTrac have emerged as curious, and in some respects quite regrettable.

[29] The AWU has advocated for wage payments to be made to persons who worked during a period of a notified strike. WesTrac has acted to encourage its employees to take more rather than less strike action. The unusual position of the Parties in this instance was identified during the Hearing and described as “…union wants payment for strike breaking, employer doesn’t want people to take less than the full amount of – please, give us all your full industrial. Every time you take industrial action, you must give it 100 per cent.” 2

[30] This folly commenced when WesTrac determined that the relevant employees took unprotected industrial action when they participated in only a portion of the four hour stoppage which had been notified. Disingenuously WesTrac sought to characterise the industrial action taken by the relevant employees as unprotected because it did not strictly comply with the full extent of the four hour stoppage that had been notified. However, WesTrac provided no evidence upon which to make even the slightest suggestion that the taking of industrial action for a lesser period during the period encompassed by the notification had any impact upon its capacity to take any defensive action.

[31] The motivation for treating the action of the relevant employees as unprotected industrial action was identified as part of the “tit-for-tat” exchanges between the Parties that have occurred as they have engaged in the “rough and tumble” associated with industrial action in the enterprise bargaining contest. The proposition that the lesser periods of industrial action taken by the relevant employees, during the period of time that was encompassed by the notification, was unprotected because the action did not strictly comply with the full period of the notified stoppage, could only be genuinely contemplated if some evidence was provided of difficulties that were created for the employer to take defensive action.

[32] Consequently, in the absence of any evidence of difficulty for the employer to take defensive action because of the lesser period of strike action taken by the relevant employees, there was simply no basis to establish that the notification requirements of s. 414 of the Act had been breached because the relevant employees did not take strike action for the full four hours as notified. The industrial action taken by the relevant employees on 9 April 2019 was protected industrial action.

[33] However, the determination made by WesTrac to treat the industrial action taken by the relevant employees on 9 April 2019 as unprotected industrial action cannot be disturbed by any outcome that is available in this matter.

The Agreement Terms

[34] The DSP upon which the application in this matter is made is found at clause 39 of the Agreement and is in the following terms:

“39. Dispute Resolution Procedure

(a) If a dispute arises about the meaning or application of this Agreement, the National Employment Standards (NES) or the General Protections provisions, the parties to the dispute agree that, in the first instance, they will attempt to resolve the dispute at the workplace level, by discussions between the Employee/s and the relevant Supervisor and/or management.

(b) An Employee who is party to the dispute may appoint a representative for the purposes of the procedures in this clause.

(c) The procedure that must be followed in attempting to resolve the dispute at the workplace level includes the following steps:

1) the Employee must contact their immediate Supervisor and ask them to arrange a meeting for them to raise their dispute. During the meeting, the Employee must explain what their dispute is and how it is impacting on them;

2) if the dispute remains unresolved after forty eight (48) hours, the Employee's immediate Supervisor will arrange for them to meet with the Branch Manager. During the meeting, the Employee must explain what their dispute is and how it is impacting on them;

3) if the dispute remains unresolved, the Branch Manager will arrange for the Employee to meet with the Regional Manager. During the meeting, the Employee must explain what their dispute is and how it is impacting on them;

4) if the dispute remains unresolved, the Regional Manager will arrange for the Employee to meet with the General Manager. During the meeting, the Employee must explain what their dispute is and how it is impacting on them.

(d) The Employer is committed to resolving any arising or remaining di spute as effectively and efficiently as possible.

(e) It is the aim of the Employer to resolve or escalate the dispute within forty eight (48) hours initially, then five (5) working days, or as is reasonably required, at each of the steps contained in clause 39(c).

(f) If the matter remains unresolved, either party may refer the matter to the Fair Work Commission (FWC).

(g) The FWC will attempt to resolve the dispute as it considers appropriate, including by mediation and conciliation. If the FWC is unable to assist the Parties in resolving the dispute, it may arbitrate the dispute and make a determination which is binding on the Parties, subject to either party exercising a right to appeal against the determination (being a decision under Div 3 of Part 5.1 of the Fair Work Act).

(h) A FWC determination cannot be inconsistent with legislative.

(i) While the parties are trying to resolve the dispute using the procedures in this clause, the status quo shall remain, where the existing state of affairs would remain until the dispute is resolved:

1) an Employee must continue to perform his or her work as he or she would normally unless he or she has a reasonable concern about an imminent risk to his or her health or safety; and

2) an Employee must comply with a direction given by the Employer to perform other available work at the same workplace, or at another workplace, unless:

A. the work is not safe; or

B. applicable Work Health and Safety legislation would not

permit the work to be performed; or

C. the work is not appropriate for the Employee to perform.

(j) Each step of the procedure set out in this clause will be recorded in writing, including the actions taken.

(k) The procedure set out in this clause will not apply to a dispute about termination of employment under clause 41 of this Agreement.”

[35] The outcome that has been sought by the AWU has been identified as a Draft Order to be made in the following terms:

“1. Pursuant to s. 739 of the Fair Work Act 2009 (the Act) the Fair Work Commission determines:

a) That in accordance with clause 22 of the WesTrac Pty Ltd (NSW and ACT Product Support) Enterprise Agreement 2017, all relevant employees must be paid for all rostered hours worked.”

[36] The Draft Order sought by the AWU refers to clause 22 of the Agreement which is in the following terms:

“22. Payment of Wages

(a) Wages and allowances will be paid fortnightly.

(b) The wages and allowances will be paid by electronic funds transfer into accounts nominated by the Employee's choice.

(c) Should an Employee incur a dishonour fee on a mortgage or personal loan from their financial institute, resulting from an underpayment of the ordinary weekly pay, the Employer will review on a case by case basis. Should the underpayment be as a result of the Employee's error, no payment would occur. Should the underpayment be as a result of an Employer error, the Employer will pay the dishonour fee to a maximum of $250.”

[37] The Draft Order proposed by the AWU does not specify or otherwise identify “all relevant employees”, and the relevant provisions of clause 22, paragraphs (a) and (b), specify the frequency, (fortnightly), and the method (electronic funds transfer), of payment of wages. However, it was clear that the words “must be paid for all rostered hours worked” as proposed in the Draft Order, were intended to have a practical application to provide for payment of wages to the relevant employees in respect to the time that they worked on 9 April 2019, and for which WesTrac had withheld payment by virtue of its determination that the relevant employees had taken unprotected industrial action, and that therefore subsection 474 (1) (b) of the Act applied.

[38] Consequently, in this instance, in the absence of any agreed question to be determined by the Commission pursuant to a DSP, the outcome sought by the Draft Order as proposed by the AWU, represented an Order that was intended to require the employer to make payment for an underpayment of wages. An Order to require rectification of an underpayment of wages involves a determination of the extant right of an employee so as to have that employee obtain a benefit derived from an industrial instrument. A determination of this nature involves the exercise of judicial power, and is consequently beyond jurisdiction of the Commission.

[39] Consequently, as the Order sought by the AWU would, by its intended practical application, necessarily involve the exercise of judicial power, the Commission does not have jurisdiction to provide for the remedy sought by the AWU. However, the absence of success for the AWU in this instance may not be greeted with universal disappointment amongst its members. As previously mentioned, it was something of a curious prospect that the AWU would be seeking to have payment made to persons who worked during a period of a notified strike. As a simple, objective observation, it would seem that members of the AWU who had participated in the four hour strike on 9 April 2019, may be somewhat underwhelmed by the expenditure of the Union’s resources in the pursuit of payment for individuals who had worked during part of the time when they were on strike.

Conclusion

[40] In this case, the Commission has been required to determine an issue in contest which when properly understood, is not about the application or interpretation of particular terms contained in the Agreement. In the absence of any agreed question about which the Parties seek the determination of the Commission, the DSP contained in the Agreement does not provide a jurisdictional foundation for the outcome sought by the AWU in this instance. The issue in contest is essentially an underpayment of wages matter, the determination of which would require the exercise of judicial power, and for which the Commission does not have jurisdiction.

[41] Consequently, the application made by the AWU must be refused. The application is dismissed. An appropriate Order shall be issued separately.

COMMISSIONER

Appearances:

Mr T Craven appeared for The Australian Workers’ Union.

Mr S Amendola, solicitor from K&L Gates with Mr D DeBijl from WesTrac Pty Ltd appeared for the employer.

Hearing details:

2019.

Sydney:

July 15.

Printed by authority of the Commonwealth Government Printer

<PR710599>

 1   Thiess Pty Ltd v Construction, Forestry, Mining and Energy Union; Construction, Forestry, Mining and Energy Union v Thiess Pty Ltd; Construction, Forestry, Mining and Energy Union, v Mt Owen Pty Ltd; Mt Owen Pty Ltd v Construction, Forestry, Mining and Energy Union [2015] FWCFB 5530, Hatcher VP, Catanzariti VP, & Johns C.

 2   Transcript @ PN262.