[2017] FWC 1260

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.437—Protected action

The Maritime Union of Australia
v
Co-Operative Bulk Handling Limited T/A CBH Group
(B2017/69)

COMMISSIONER WILLIAMS

PERTH, 10 MARCH 2017

Proposed protected action ballot of employees of Co-operative Bulk Handling Limited T/A CBH Group.

[1] This decision concerns an application by The Maritime Union of Australia (the MUA or the Applicant) under section 437 of the Fair Work Act 2009 (the Act)for an order requiring a protected action ballot to be conducted. The Respondent is Co-operative Bulk Handling Limited T/A CBH Group (CBH or the Respondent).

Factual findings

[2] Considering the evidence of the witnesses I find that the following events occurred on the following dates. Mr Cassar is the MUA’s Assistant Branch Secretary. Ms Ross is CNH’s Employee Relations Manager. Mr Hudston is a facilitator engaged to chair the bargaining meetings.

[3] 29 February 2016 - A notice of employee representational rights (NERR) was sent to all Kwinana plant operators.

[4] 1 April 2016 - First bargaining meeting in relation to a new agreement.

[5] 15 April 2016 - Parties attended a second bargaining meeting. The MUA put forward a log of 50 claims, and provided a short explanation of the basis for each claim. CBH advised it would consider the claims put forward by the MUA on behalf of employees.

[6] 27 April 2016 - Mr Hudston forwarded an email from Mr Cassar to Ms Ross which attached a reduced log of 18 claims on a ‘without prejudice’ basis.

[7] 2 May 2016 - Mr Cassar attached an updated revised log, containing 31 claims.

[8] 3 May 2016 - The parties attended a third bargaining meeting. The MUA provided its model clauses for CBH’s consideration. CBH agreed to consider these and advise in due course. The parties then discussed those items contained on the MUA’s second revised log of claims dated 2 May 2016. CBH sought further information from the MUA as to the basis for the relevant claims.

[9] 17 May 2016 - The CBH Kwinana Plant Operators Collective Union Agreement 2013 (the 2013 Agreement) reached its nominal expiry date. Ms Ross attended a meeting with Mr Cassar and Mr Palmer to obtain clarification on several matters arising from the MUA’s draft clauses, including the proposed consultation clause. Following the meeting, Ms Ross prepared an ‘issues log’ which summarised the parties' positions on each of the key issues in dispute between the parties.

[10] 24 May 2016 - The parties attended a fourth bargaining meeting. The parties talked through the issues log prepared by CBH and clarified their respective positions on each key issue in dispute.

[11] 15 June 2016 - Ms Ross provided to Mr Cassar for consideration an updated issues log and draft clauses which addressed the items agreed in-principle between the parties at the meeting on 24 May 2016.

[12] 20 June 2016 - The parties attended a fifth bargaining meeting. The parties talked through the issues log prepared by CBH and clarified their respective positions on each key issue in dispute. MUA and CBH reached conditional agreement on a number of issues in dispute, subject to the wording of proposed draft clauses being agreed. CBH notified the MUA of its intention to discuss wages at the next bargaining meeting, confirming that the MUA would need to provide justification to support any wage claim above 0%.

[13] 4 July 2016 – There was a telephone discussion between Mr Hudston and Ms Ross. Mr Hudston advised that he had had an informal conversation with Mr Cassar and Mr George Gakis from the MUA. During this conversation, Mr Cassar referred to a picket and also to CBH’s recent wage offer and the fact he was under pressure from employees to lodge a protected action ballot order (PABO). The parties attended a sixth bargaining meeting.

[14] At this sixth bargaining meeting the parties talked through the issues log prepared by CBH, clarifying which issues had been resolved through agreement and which issues remained outstanding. The MUA maintained its concerns regarding CBH consulting on significant changes to the ‘Authorised Officer’ role and transmission of business. Several issues which reached conditional agreement at the fourth meeting were resolved, including working alone and work through. The MUA advised the 3.5% wage claim was based on forecast data for the next 3 years, but indicated it would be prepared to go back to employees to propose a 3% increase. CBH provided an initial wage offer of 1% each year for three years. CBH and the MUA agreed to a number of action items from this meeting, including the provision of the forecast data supporting the MUA’s wages claim, by no later than close of business 8 July 2016.

[15] 5 July 2016 - Ms Ross spoke to Mr Cassar by telephone and emphasised that CBH remained committed to attempting to reach agreement through negotiations and was prepared to take into account any feedback from employees with respect to its wage offer at the next bargaining meeting. Mr Cassar advised that the employees were unhappy with CBH’s wage offer of 1%, and had indicated a desire to move straight to protected industrial action. However, the MUA had encouraged employees to wait to take industrial action until at least after the next bargaining meeting.

[16] 8 July 2016 - Ms Ross provided Mr Cassar with an update on all CBH assigned action items via email. Ms Ross also requested a copy of the forecast data previously referred to, to allow CBH time to consider that data prior to the next meeting.

[17] 13 July 2016 - Ms Ross again requested, via email, a copy of the forecast data that was due to be provided by 8 July 2016.

[18] 25 July 2016 - The parties attended a seventh bargaining meeting. CBH offered a wage increase of 2% per year for 3 years. CBH noted this offer was conditional upon the MUA agreeing to CBH’s preferred position with respect to the remaining outstanding items. The MUA advised CBH employees were seeking wage increases that allowed them to reach parity with Geraldton plant operators. The MUA advised the minimum wage increase employees would be prepared to accept was 2.5% per annum. Provided that CBH offered a 2.5% annual wage increase on the basis of a two year agreement, MUA accepted the conditions placed on CBH's wage offer subject to one proposed change with respect to the consultation about change provision of the replacement Agreement. CBH undertook to consider this proposed change and respond in due course. CBH filed an application for the Commission to deal with a bargaining dispute under section 240 of the Act (B2016/727) as the parties were still not in agreement on the issue of wages.

[19] 27 July 2016 - Mr Capper, CBH’s General Manager of Operations wrote to Mr Cassar to remind him of his obligations with respect to organising unprotected industrial action.

[20] 1 August 2016 - Mr Cassar responded to Mr Capper’s email regarding unprotected industrial action dated 27 July 2016.

[21] 3 August 2016 - Mr Capper emailed Mr Cassar regarding unprotected industrial action and clarifying the inaccuracies in Mr Cassar’s email.

[22] 9 August 2016 - The parties attended a conference before Commissioner Cloghan (re: section 240 application).

[23] 7 September 2016 – An employee Mr Rhyse Willis was stood down from work pending investigation into complaints.

[24] 9 September 2016 - The parties attended a second conference before Commissioner Cloghan (re: section 240 application).

[25] 12 September 2016 - CBH commenced advertising online for new casual plant operators at the Kwinana Terminal.

[26] 18 September 2016 - Applications for casual plant operator positions closed.

[27] 19 September 2016 - The parties attended an eighth bargaining meeting. During a break in the meeting Mr O’Neil received an email from Mr Palmer advising he wished to initiate the dispute resolution procedure in the 2013 Agreement in relation to CBH’s obligation to consult with the workforce prior to commencing recruitment for casual employees.

[28] 27 September 2016 - The parties attended a third conference before Commissioner Cloghan (re: section 240 application). Bargaining representatives agreed to the terms of a replacement Agreement. Mr Cassar emailed Ms Ross requesting that as no response had been received to Mr Palmer’s email dated 19 September 2016, the dispute be escalated in accordance with the 2013 Agreement.

[29] 28 September 2016 - Ms Ross sent an email advising that Mr Palmer and Mr O’Neil were on leave.

[30] 29 September 2016 - Commissioner Cloghan endorsed the agreed terms of the draft Agreement in a Statement. The statement at paragraph [10] to [12] explains the two negotiating parties had agreed to put a position to their respective principals being:

2.5% wage increases on 30 September 2016, 2017 and 2018.

Flexibility for the taking of meal breaks in the rail area at a time to meet the continuous operational requirements of that area however no employee would be required to work more than 5 hours without a meal break.

The Agreement to have a 3 year term.

Other claims including reduction in minimum hours of casual engagements, extended flexibility of meal breaks and supervisor scheduling would be off the table.

[31] On this same day Mr Cassar sent an email advising the MUA intended to progress the casuals dispute in Mr Palmer’s absence and requesting the matter be escalated to Mr Bignell, CBH’s Kwinana Zone Manager.

[32] 30 September 2016 – There was a full workforce meeting of Kwinana plant operators at the Kwinana Terminal, led by Mr Cassar. Agreed terms were put to the workforce for consideration. The workforce unanimously voted in-principle to accept the proposed terms. Mr Cassar subsequently confirmed the outcome of the meeting by way of an email to Ms Ross.

[33] 4 October 2016 - Mr Bignell emailed Mr Cassar and provided a substantive response to the casuals dispute. Mr Cassar responded and asked who the dispute would be escalated to.

[34] 7 October 2016 - Mr Bignell replied to Mr Cassar and asked him to provide a more detailed response addressing the various points raised in Mr Bignell’s previous email.

[35] 13 October 2016 - Ms Ross emailed Mr Cassar a copy of the draft CBH Kwinana Plant Operator Collective Union Agreement 2016 (the draft 2016 Agreement) and a document explaining each of the changes that had been made.

[36] 14 October 2016 - Mr Cassar emailed Mr Bignell and responded to Mr Bignell’s request for a more detailed response to the casuals dispute.

[37] 19 October 2016 - Mr Cassar emailed Ms Ross to advise he did not expect to be able to provide a response in relation to the draft 2016 Agreement until 21 October 2016.

[38] 21 October 2017 - Mr Cassar emailed Mr Bignell and asked to have the casual disputes matter escalated to more senior management.

[39] 24 October 2016 - Mr Bignell emailed Mr·Cassar and advised Mr Cassar that CBH believed it had exhausted the escalation provisions in the 2013 Agreement. CBH issued Kwinana plant operator, Mr Rhyse Willis, a letter requesting he show cause why his employment should not be terminated, following an investigation into allegations of misconduct that had been made against him. Mr Capper received a call from Mr Chris Cain, Branch Secretary, MUA, on his mobile regarding Mr Willis. In summary, Mr Cain:

said he was concerned CBH was proposing to terminate Mr Willis’ employment;

asked whether Mr Capper was aware that a vote on the Agreement was coming up; and

said the Willis case raised the need for a disciplinary clause in the proposed Agreement and he would personally attend the MUA’s meeting with the workforce at the Kwinana Terminal to ensure the draft 2016 Agreement would be voted down. He referred to wanting to make changes to a clause in the proposed Agreement.

Mr Capper gave Mr Cain a summary of the misconduct allegations and said he did not see the connection between the two issues. Mr Capper called Ms Ross to advise her of the call from Mr Cain. Ms Ross emailed Mr Cassar to request a response to the draft 2016 Agreement, as no response had been received to date. Mr Cassar responded and advised he would review it as soon as he was able.

[40] 25 October 2016 - The MUA filed an application under section 739 of the Act (C2016/6355) with the Commission in relation to the casuals consultation dispute.

[41] 26 October 2016 - Mr Cassar emailed Ms Ross and provided a response to the draft 2016 Agreement.

[42] 28 October 2016 - Ms Ross emailed Mr Cassar and responded to the various matters raised in his response to the draft 2016 Agreement.

[43] 31 October 2016 - Mr Cassar sent a letter to Mr Capper responding to the stand down letter issued to Mr Willis on 24 October 2016. The letter referred to concerns with CBH’s current disciplinary process and that it would like to work to develop an improved disciplinary process potentially for inclusion in the proposed 2016 Agreement. Mr Cassar emailed Ms Ross regarding the drafting of the proposed 2016 Agreement.

[44] 1 November 2016 - Ms Ross emailed Mr Cassar and responded to the items raised in his email dated 31 October 2016. Ms Ross raised concerns that Mr Cassar was now seeking an increase to the Night Shift In-Charge allowance (NSIC allowance), which had not been discussed during bargaining.

[45] 2 November 2016 - Mr Cassar emailed Ms Ross and confirmed the employees expected an increased to the NSIC allowance as part of the 2016 Agreement.

[46] 3 November 2016 - Ms Ross emailed Mr Cassar and confirmed CBH agreed to increase the NSIC allowance. Mr Cassar emailed Ms Ross and confirmed “That’s fine by me”. Mr Cassar emailed Ms Ross and advised employees believed that a one hour vote meeting was not within the parameters of the 2013 Agreement. Ms Ross emailed Mr Cassar and advised it was CBH’s understanding the 2013 Agreement does not deal with the issue of the meeting length, as employees attendance at the meeting is voluntary. Ms Ross confirmed CBH was prepared to pay employees a maximum of one hour for their attendance. Mr Cassar responded and asked that in the interests of keeping things moving forward, Ms Ross initiate the access period and the parties could work through the meeting details the following week. CBH filed with the Commission and served on the MUA a response to the MUA’s application in the casuals consultation dispute.

[47] 4 November 2016 - Ms Ross emailed Mr Cassar and advised that she was happy to progress with commencing the access period. Mr Cassar emailed Ms Ross and advised “we remain apart on the meeting length”, so requested that when employees were advised of the access period, this not specify the meeting length. Ms Ross emailed Mr Cassar and confirmed there was no requirement to specify the meeting finish time when employees were advised of the vote details. Ms Ross advised that CBH’s position that employees would be paid for a one hour meeting would not change given they had already had a meeting where in-principle agreement had already been given, and if this was not acceptable to employees, the alternative would be to conduct an electronic vote. The parties attended a conference in the Commission with respect to the casuals consultation dispute.

[48] 7 November 2016 - Ms Ross emailed Mr Cassar and noted that as no response had been received to her email, CBH proposed to commence the access period with the vote method to be by show of hands on 15 November 2016 at the Kwinana Terminal. The Access period for the Agreement commenced.

[49] 11 November 2016 - CBH terminated Mr Willis’ employment with immediate effect.

[50] 14 November 2016 - Mr Cassar emailed Ms Ross and advised he would be on site at the Kwinana Terminal conducting the vote the following day, and that he would have another official assisting, although he was not sure who that would be yet. Ms Ross emailed Mr Cassar and asked him to keep note of how many employees voted ‘yes’ and how many voted ‘no’. Mr Cassar responded that would be no problem.

[51] 15 November 2016 - Mr O’Neil advised Ms Ross that Mr Cassar and Mr Cain had attended the workforce meeting prior to the vote. The proposed 2016 Agreement was put to a vote, by way of a show of hands and the 2016 Agreement was unanimously voted down. Mr Cassar emailed Ms Ross setting out the five reasons why the proposed 2016 Agreement had been voted down.

[52] 16 November 2016 - Ms Ross emailed Mr Cassar advising that CBH required time to consider the outcome of the vote. Ms Ross suggested the parties hold a further bargaining meeting in the week commencing 12 December 2016 as CBH was in the middle of harvest.

[53] 18 November 2016 - Mr Cassar sent an email to Ms Ross advising that if CBH did not make itself available to meet with the MUA on either 23, 24 or 25 November 2016, the MUA would file an application for a PABO. Ms Ross responded and agreed to meet with Mr Cassar on 25 November 2016.

[54] 25 November 2016 - The parties held another bargaining meeting. Mr Cassar agreed to provide Ms Ross with draft clauses in relation to the MUA’s five claims.

[55] 9 December 2016 - Mr Cassar provided the draft clauses to Ms Ross at 3.59 p.m. and asked her to indicate by COB Tuesday, 13 December 2016 whether CBH accepted the draft clauses.

[56] 12 December 2016 - Ms Ross emailed MUA to advise it was unable to respond to the draft clauses within that timeframe. Ms Ross advised that it required more time to consult internally and that the income protection clause would need to be costed. Ms Ross indicated it would require around one week to consider the proposed clauses and suggested the parties meet again in the week commencing 19 December 2016. Mr Cassar responded and advised he was unavailable to meet until Friday, 23 December 2016, or January 2017. Mr Cassar also advised that the MUA would be making an application for a PABO “this Wednesday”, even though it would not have received CBH’s response to the proposed clauses by that time.

[57] 13 December 2016 - Ms Ross sends email to Mr Cassar advising of its concerns that the MUA was not genuinely trying to reach agreement in the matter and that any PABO application would be opposed by CBH. Mr Cassar was advised that CBH would be contacting the Commission to seek an urgent conference in relation to a section 240 application (B2017/1305) filed.

[58] 14 December 2016 – A hearing was held separately in relation to the MUA’s application for interim orders in the casuals consultation dispute. The MUA provided a response noting CBH’s comments regarding the section 240 application.

[59] 20 December 2016 – The parties attended a section 240 conference in the Commission before the Commission as currently constituted. At the conference, Mr Cassar provided further details behind some of the five claims that had been raised late in the negotiations. He also advised that:

the additional claim about the vote method had been made because before the previous vote, Ms Ross had mentioned the possibility of an electronic vote;

the additional claim about the disciplinary clause was because CBH had recently terminated the employment of a Kwinana Plant Operator (i.e. Mr Willis); and

the additional claim about the consultation clause and status quo was because of the position being taken by CBH as part of the ongoing dispute about the recruitment of casual employees as the Kwinana terminal.

[60] 6 January 2017 - Ms Ross sent a letter to Mr Cassar outlining CBH’s position in relation to the five claims.

[61] 13 January 2017 – A decision 1 was handed down in relation to the MUA’s application for interim orders in the casuals consultation dispute.

[62] 16 January 2017 - Mr Cassar sends a letter setting out the MUA’s response to CBH’s letter dated 6 January 2017. With respect to each of the claims, Mr Cassar advised ‘Claim stands’ and also accused CBH of ‘manipulating’ the interpretation of the 2013 Agreement, being ‘provocative’ and taking an ‘aggressive HR approach’. Ms Ross sends an email to Mr Cassar advising that CBH would contact the Commission and request the matter be listed for a further conference as part of its section 240 application.

[63] 17 January 2017 – The parties received a notice of listing from the Commission as currently constituted listing CBH’s section 240 application for a further conference on 2 February 2017. The MUA filed this application for a PABO.

[64] Considering the evidence of Mr Cassar under cross-examination I find that the first time the concept of an electronic vote was mentioned was when Ms Ross suggested that was a possible option to Mr Cassar in her emails. The option of an electronic vote was not mentioned previously during the bargaining.

[65] The evidence is Mr Cassar in the lead up to the meeting and vote on 15 November 2016 was not attempting to delay the vote taking place and indeed was encouraging CBH to go ahead with the vote. 2

[66] The meeting on 15 November 2017 of CBH employees was attended by Mr Cassar and Mr Cain. The beginning of the meeting involved questions from the employees who had queries about some things that had been happening. There was discussion about why CBH would not allow the employees to have six hours for their meeting. 3 There are also questions about the option of the electronic vote. Mr Cassar advised the employees that it was the employer’s prerogative how the vote was conducted and some employees asked if there was anything they could do to fix that. Mr Cassar told them that they might be able to put something in the proposed Agreement that requires the vote to be a show of hands.4

[67] The evidence is Mr Cain did speak at the meeting. He spoke about the income protection scheme after the issue had already been discussed by the employees. He answered a number of questions about income protection as he has more knowledge of this than Mr Cassar. Mr Cain did not get involved in the income protection issue until after the employees had already made a decision about it. 5

[68] The evidence is Mr Cain had very little to do with the discussion prior to voting on the proposed Agreement and Mr Cassar believed he held off and discussed matters after the employees had voted. 6

[69] At the previous meeting where the in-principle vote in favour of the proposed Agreement occurred Mr Cassar says there was a dissenting group who initially did not want to support the proposed Agreement but did when the vote was taken. The numbers changed however when the employees voted on 15 November 2016. Mr Cassar’s view as to what changed was that there remained a belief among some employees that the wage increase offered was not enough when CBH was having a bumper season. Some employees now also had concerns about how long the paid meetings should be i.e. one hour or six hours. The alternative approach of an electronic vote also concerned some employees. In addition there were concerns over the lack of consultation by CBH when they engaged the casuals a few months earlier and, related to this, how CBH interpreted the status quo provisions of the 2013 Agreement which had not prevented CBH putting on the casuals which was disputed. There was some criticism of the MUA for not having the correct clause to prevent this. Employees were also raising concerns about the disciplinary process CBH had followed when dismissing Mr Willis who had been terminated four days earlier. A claim for income protection insurance which had previously been dropped, because Mr Cassar understood it was not a strong issue with the workforce, was raised again at the meeting and discussed as a proposal where it would be funded by a forgone wage increase. 7

[70] Mr Cassar when he went into the 15 November 2016 meeting expected there to be some dissent but thought that the proposed Agreement would get over the line.

[71] Mr Cassar’s evidence was that Mr Cain was at the meeting to talk about “Protect”, an income protection insurance scheme and because there had been lots of phone inquiries to the MUA about Mr Willis’s termination.

[72] Mr Cassar’s evidence was that during bargaining they had considered an MUA claim regarding a disciplinary procedure. CBH’s response had been that they were willing to put everybody, the employees and managers, through a training session about the dis policy because if they all understood the disciplinary policy they would see it was adequate. Mr Cassar’s evidence was that on that basis the MUA had not pursued that claim further. The employees however in the wake of Mr Willis’s termination did not accept that solution any longer. 8

[73] Mr Cassar was asked what Mr Cain’s objective was in having the phone discussion with Mr Capper on 24 October 2016 and his evidence was that it was to try and get Mr Capper to think about whether it was a good idea to terminate Mr Willis before the vote for the proposed Agreement. 9

[74] Mr Cassar’s understanding after the phone discussion between Mr Cain and Mr Capper was that Mr Cain believed they needed a disciplinary clause to go into the proposed 2016 Agreement to prevent the problem they believed they were having with Mr Willis’s dismissal happening again. His evidence was that employees were ringing Mr Cain making reference to the training sessions that had been arranged, which they were told would be sufficient to resolve their concerns about CBH’s disciplinary processes, and these employees were saying to Mr Cain that Mr Cassar had dropped the ball.

[75] Consistent with this the evidence is that on 31 October 2016 Mr Cassar wrote to Mr Capper regarding the show cause letter sent to Mr Willis. In the final paragraph of that letter Mr Cassar referred to the fact that an improved disciplinary procedure had been an MUA claim for the proposed 2016 Agreement but this claim had been forgone however the MUA were now concerned that the disciplinary process which had been applied to Mr Willis highlighted problems with the current procedure and they would like to work with CBH to develop an improved disciplinary procedure potentially for inclusion in the proposed 2016 Agreement. 10

[76] Mr Cassar’s evidence was that when the disciplinary procedure had been discussed in the bargaining sessions previously Ms Ross had argued “When was the last time we sacked somebody at Kwinana?” and at the time Mr Cassar had acknowledged that this had not occurred in his time representing the MUA at CBH. After the dismissal of Mr Willis it was apparent that the training which had been proposed was not going to put the employees’ minds at rest and hence the MUA were putting back on the table their previous claim for an improved disciplinary process to be included in the proposed 2016 Agreement.

[77] Following the 15 November 2016 meeting Mr Cassar emailed Ms Ross advising that the employees had unanimously voted against accepting the proposed 2016 Agreement and that the following issues required resolution before the new agreement can be accepted:

Voting process to be inserted saying for the replacement agreements in future to be voted on by a show of hands and meetings held in accordance with provisions of the agreement;

Consultation and change provision need to be amended to protect the rights of employees to ensure CBH complies with the intent of the clause;

Status quo definition needs to be improved to ensure CBH complies with the intent of the status quo provisions;

Disciplinary procedure to be inserted into the proposed agreement; and

Income protection be revisited on the basis that the MUA has now clarified that the cost of the claim e.g. 2% of wages would be inclusive of all fees and charges.

[78] That email concluded with:

“It is unfortunate that the vote did not succeed but there had been some significant developments occur at the site which were bound to have an effect on the tolerance level of employees.

Please provide a response in relation to these claims which clarifies specifically where the parties remain apart.”

[79] Mr Cassar’s evidence is that if CBH agrees to the five outstanding issues the parties would have reached agreement. 11

[80] I accept that the day before the vote of employees which rejected the proposed 2016 Agreement Mr Cassar and Ms Ross entered into an email exchange which gave no indication that the vote was not likely to be successful. Indeed on that day, 14 November 2016, at 10.27 a.m. Ms Ross emailed to Mr Cassar that assuming the proposed 2016 Agreement was voted up for the purposes of making an application to the Commission she needed to know how many employees voted yes and how many voted no. Mr Cassar replied that that would be no problem as he had to record that for his paperwork as well. 12

[81] Ms Ross’s evidence was that she had not threatened to force the employees to vote by electronic means but rather offered that as an alternative if they did want to participate by way of a show of hands. This had arisen out of CBH advising the MUA that they are only willing to pay employees for attendance at a one-hour meeting given there had been the previous in principle vote meeting.

[82] Ms Ross’s evidence was that until 15 November 2016 she had no reason to believe that the MUA was not genuinely trying to reach agreement.

[83] Her belief was that events since 15 November 2016 have indicated there is no willingness from the MUA to explore the additional items the MUA has put to CBH. She does not believe at the time of the hearing that the MUA was generally trying to reach an agreement.

[84] The evidence was that at the date of the hearing of this matter the MUA has provided model clauses for all the items they say need to be resolved with CBH for an agreement to be made.

[85] Following the phone conversation between Mr Cain and Mr Capper, mentioned above, Mr Capper spoke to Ms Ross about that conversation. Her evidence was that neither Mr Capper nor she had concerns about that conversation. Ms Ross did not speak to Mr Cassar about the conversation.

[86] Following the receipt of Mr Cassar’s letter dated 31 October 2016 about the show cause letter sent to Mr Willis wherein Mr Cassar raised concerns about the disciplinary procedure and the need to resolve this in the proposed Agreement Ms Ross did not contact Mr Cassar to explore this issue further. Between that time and 15 November 2016 vote by employees Mr Cassar and Ms Ross were negotiating final wording for the proposed 2016 Agreement however they never discussed any wording to deal with the MUA’s concerns about disciplinary processes. 13

[87] Ms Ross agrees that the issue between the parties about the termination of Mr Willis was resolved prior to the hearing.

[88] The evidence of Ms Ross is that whilst Mr Cassar has, over the period of the negotiations, threatened previously to apply for a PABO a number of times there has been only one PABO application made to the Commission.

[89] I accept the evidence of Ms Ross that after the 15 November 2016 meeting where the proposed Agreement was voted down Ms Cassar sent correspondence to her providing details of the five further matters the employees wanted settled for an agreement and he explained the reasons why the proposed Agreement was voted down. Sometime after that Mr Cassar and Ms Ross had a meeting about these matters and CBH asked for draft clauses at that meeting. The MUA provided those draft clauses on 9 December 2016. CBH has then had some time to consider these and advised on 12 December 2016 that they could not respond to the draft clauses in the MUA’s timeframe. Mr Cassar advised Ms Ross that in that case they would be applying for a PABO. Before that application was made there was a conference in the Commission on 20 December 2016. At that conference CBH undertook to provide a response to the draft clauses which was sent on 6 January 2017. The MUA has since replied to CBH’s correspondence generally rejecting the compromises of CBH and advising that their claims still stood. Following this the MUA made this application to the Commission.

[90] The evidence of both Ms Ross and Mr Bignell is that the MUA’s rejection of CBH’s compromise proposals on some of the five outstanding issues and the MUA’s blunt response that their claims stand indicates to them that the MUA are not bargaining in good faith and are not genuinely trying to reach an agreement. 14

[91] Mr Bignell gave evidence regarding the impact of protected action on CBH’s operations. His evidence was that depending upon what form of industrial action is taken it will have a significant impact on CBH’s customers and employees of Watco International Pty Ltd (Watco). CBH has binding contracts to sell 874,000 tons of grain from the Kwinana Terminal in March 2017 and 837,500 tons for April 2017. If due to protected industrial action CBH is not able to load a customer’s ship on its expected shipping date the customer will incur demurrage fees which would be a minimum be $5,000 per day and can be as high as $100,000 per day but are commonly around $10,000 per day. Those CBH customers affected by industrial action may default on their own supply contracts and so be liable subjected to additional damages.

[92] Industrial action involving a stoppage of work or a ban on working overtime would have the biggest negative impact on CBH’s customers. This is because capacity at Kwinana is fully booked until the end of May and if grain cannot be loaded out of the Kwinana terminal as scheduled, even for four hours, this will start to cause a backlog in loading which has a knock-on effect to many customers of CBH.

[93] A period of seven days’ notice of future industrial action would at least allow some of CBH’s customers to renegotiate with their buyers to adjust the delivery period under their sales contracts to perhaps reduce any damages contractually that may be imposed on them.

[94] CBH’s capacity to engage alternative labour to undertake the work while its employees take industrial action is limited given it requires a minimum of five shifts for an employee to be inducted to work safely at the Terminal and they would then need to be rostered off two days to manage fatigue issues. Consequently the minimum number of days it takes for a new employee to become ready for work is seven.

[95] Apart from the impact on CBH’s customers there is an impact on Watco the operator of the trains which transport grain to the terminal. 85% of grain comes to the Kwinana Terminal by rail. CBH’s plant operators unload the grain from the trains which during busy periods amounts to approximately 30,000 tons a day. Brookfield Rail Pty Ltd (Brookfield) is the operator of the rail network and changes to the schedule of trains and their unloading normally requires agreement from both Watco and Brookfield. This is unlikely to be achieved practically at short notice if there was industrial action because it depends on whether or not trains are already loading on a particular part of the rail track network and involves considerations of the fact that Brookfield has other customers using the rail network and stopping a train may cause flow-through blockages on the network to other Brookfield customers. The more notice available the less severe the impact will be on Watco, Brookfield and other rail network users.

[96] Even a brief stoppage of work at the Kwinana Terminal means trains arriving would not be able to be unloaded, with significant impacts for Watco and Brookfield but this would also mean that afterwards there would be a shortage of grain available for CBH to load onto vessels for its customers.

[97] Mr Bignell was not challenged in cross-examination on his evidence as to how serious the impact of industrial action would be for CBH and the other third parties mentioned above.

Applicant’s submissions

[98] The MUA has made an application for a PABO.

[99] The MUA has standing to bring the application under section 437(1) of the Act as a bargaining representative of an employee member of the MUA who will be covered by the proposed agreement pursuant to section 176(1)(b) of the Act.

[100] In accordance with section 437(3) of the Act, the application as amended specifies the group or groups of employees to be balloted and the questions that are to be put to those employees including the nature of the proposed action.

[101] The application specifies the group of employees to be balloted and the questions to be put to the employees who are proposed to be balloted, in accordance with section 437(4) of the Act. A draft of the orders sought by the application is attached to the application.

[102] The draft ballot order specifies the following:

a. It names the applicant – the MUA;

b. It identifies the type of employees to be balloted. That is, all employees of the employer to whom the CBH Kwinana Plant Operators Collective Union Agreement 2013 applies and who are members of the Applicant.

c. It provides that the voting in the ballot should close four weeks from commencement of the ballot.

d. It sets out the questions to be put to the relevant employees in the ballot and those questions include the nature of the proposed industrial action.

[103] A PABO must be made by the Commission if the requirements of s 443(1) are met. These are:

a. That an application has been made under section 437; and

b. The Applicant has been, and is, genuinely trying to reach an agreement with the employer of the employees to be balloted.

[104] The relevant provision of the Act is:

“443 When the FWC must make a protected action ballot order

(1) The FWC must make a protected action ballot order in relation to a proposed enterprise agreement if:

(a) an application has been made under section 437; and

(b) the FWC is satisfied that each applicant has been, and is, genuinely trying to reach an agreement with the employer of the employees who are to be balloted...”

[105] Section 443(1)(b) of the Act provides a requirement that the applicant is “genuinely trying to reach an agreement…”

[106] The MUA submits that genuinely trying to reach agreement is directed at the authenticity of the Applicant’s efforts to reach that goal. The genuineness or authenticity of an applicant’s efforts to reach an agreement with the employer will turn on its motivation – its intention, object or purpose.

[107] In Esso Australia v AFMEPKIU and Ors 15 (the Esso Case), the

Full Bench said:

“[57] Whether an applicant ‘has been, and is, genuinely trying to reach an agreement’ is a question of fact to be decided having regard to all of the facts and circumstances of the particular case. Such a construction of s.443(1)(b) is consistent with the judgment of the Full Court in JJ Richards and with a number of Full Bench decisions of the Commission (see Total Marine; Pelican Point Power Limited v ASU; JJ Richards No.1; Alcoa; JJ Richards No.2; and Farstad).”

[108] The Applicant relies on the statement of Mr Cassar to satisfy the requirement that the

MUA has been and is genuinely trying to reach an agreement with the Respondent.

[109] As stated by the Full Bench in Coles Supermarkets (Australia) Pty Ltd v The Australasian Meat Industry Employees Union: 16

“The temporal elements in s.443(1)(b) require that an applicant is trying to reach agreement at the time of determination (reflecting the evidence at the time of hearing) and that the applicant had been trying to reach an agreement before that time...”

[110] The Applicant submits that it is clear from the totality of Mr Cassar’s evidence that negotiations have been continuing for a considerable period, involving many meetings, in an attempt to reach an agreement.

[111] The recent actions of the MUA through Mr Cassar show that it is still trying to reach an agreement with the Respondent.

[112] On 20 December 2016, the Applicant and the Respondent engaged in conciliation in the Commission in an effort to resolve those final matters in dispute. The parties are scheduled to engage in further conciliation.

[113] The Commission can, it is submitted, be satisfied on the basis of the evidence that the Applicant has been and is genuinely trying to reach an agreement with the respondent employer.

[114] The Applicant refers to the totality of the negotiations to justify its assertion that it has been and is currently genuinely trying to reach agreement.

[115] The Applicant further understands that the Respondent asserts that the questions are unclear with respect to how or where to vote. To this end, the Applicant respectfully adopts the draft order prepared by Commissioner Hampton dated 20 January 2017 and provided to the parties.

[116] Based on the above submissions, the Applicant submits that the statutory requirements contained in section 443(1) of the Act have been met and accordingly the Commission must make a PABO.

Respondent’s submission

[117] CBH opposes the PABO filed by the MUA.

[118] CBH submits the Commission should not grant the Application because:

a. the application and the draft order attached to the application do not clearly specify the question or questions that will be put to employees who are to be balloted, including the nature of the proposed industrial action, as required by sections 437(3)(b) and 443(3)(d) of the Act;

b. the Commission ought not to be satisfied that the MUA has been, and is, ‘genuinely trying to reach an agreement’ as required by s.443(1)(b) of the Act.

[119] If the Commission determines a PABO should be made, the Respondent makes an application pursuant to section 443(5) of the Act for the notice period for any protected action to be extended to seven working days.

[120] CBH submits the application does not adequately specify the nature of the proposed industrial action.

[121] Section 437(3)(b) of the Act has the effect that an application for a PABO must specify the nature of the proposed industrial action employees will be asked to vote on.

[122] The question or questions must describe the proposed industrial action in clear terms such that employees voting on the question(s) will understand what work would not be undertaken and what work would remain to be done.

[123] The 2013 Agreement does not refer to ‘overtime’.

[124] The 2013 Agreement does refer to work performed outside of ordinary hours in clause 13.3 and extra days in clause 18.

[125] The 2013 Agreement also does not refer to ‘higher duties’.

[126] The Respondent submits that in light of this, the questions are ambiguous and it will not be entirely clear to employees who are balloted what is meant by a ban on the performance of ‘overtime’ and ‘higher duties’.

[127] The Applicant’s evidence is that the employees to be balloted will understand the reference in the application to a ban on ‘overtime’ is intended to mean a ban on employees performing ‘extra days’ within the meaning of the 2013 Agreement.

[128] The Applicant’s evidence is that the employees to be balloted will understand the reference in the application to ‘higher duties’ is intended to mean a ban on employees performing ‘night shift in charge’ duties within the meaning of the 2013 Agreement.

[129] The Respondent disputes the assertion that these things will be clear to employees, as they are not clear on their face.

[130] The Respondent also submits that the matters referred to in Mr Piccoli’s statement are not reflected in the application. If the application was intending to propose a ban on ‘extra days’ or ‘night shift in charge’ work, the application should have stated this.

[131] The Respondent therefore submits that the application does not adequately specify the nature of the proposed industrial action with respect to ‘overtime’ or ‘higher duties’.

[132] In order to grant an application for a PABO, the Commission must be satisfied the Applicant has been, and is, genuinely trying to reach agreement.

[133] The applicant for a PABO bears the onus of proving to the Commission’s satisfaction that it has been ‘genuinely trying’ to reach agreement.

[134] Where an applicant for a PACO calls acceptable evidence that their intention, object or purpose is to reach an enterprise agreement under the Act, only then will the evidentiary onus shift to the party opposing the application to demonstrate why that evidence ought not be accepted.

[135] The Applicant argues it is clear from ‘the totality of Mr Cassar’s evidence’ that negotiations have been continuing for a considerable period, and this should be sufficient to satisfy the Commission that the Applicant has been, and is, genuinely trying to reach agreement.

[136] The Respondent submits that the mere fact negotiations have been proceeding for some time is not, on its own, sufficient evidence that a bargaining representative has been and continues to be genuinely trying to reach agreement.

[137] The Applicant has led minimal evidence as to recent events in bargaining, including in particular:

a. the events that occurred between 30 September and 15 November 2016 when employees represented by the Applicant approved a proposed agreement in-principle, but subsequently voted it down; and

b. the Applicant’s current claims in the bargaining and the position of the parties and evidence of bargaining about those claims.

[138] The Respondent submits these recent events are key to the Commission’s consideration of whether or not the Applicant has been and is genuinely trying to reach agreement. By failing to lead sufficient evidence on its actions and intention during this period, the Applicant cannot satisfy the Commission that it has been, and is, genuinely trying to reach agreement.

[139] The Respondent submits the Applicant has not met its burden of proof to demonstrate to the Commission’s satisfaction that it has been, and is, genuinely trying to reach agreement.

[140] In the event a consideration of the Respondent’s evidence is necessary, the Respondent submits there is evidence before the Commission that the Applicant has not been, and is not presently, genuinely trying to reach agreement.

[141] The Respondent submits the Applicant’s evidence does not accurately reflect the totality of the Applicant’s conduct during the course of the negotiations.

[142] In particular, the Applicant's evidence does not cover in sufficient detail the Applicant’s conduct between 1 October 2016 and the present.

[143] The Respondent’s evidence, it is submitted, establishes that on 24 October 2016, the Applicant’s WA Branch Secretary engaged in conduct that was capricious, and amounted to a disingenuous attempt to undermine the bargaining that had occurred between the parties to date.

[144] Further, despite repeated suggestions by the Respondent that the parties should utilise the assistance of the Commission as part of its ongoing section 240 application to progress any matters that remain in dispute, the Applicant has declined to actively seek to make use of this.

[145] The Respondent submits the Respondent’s evidence indicates that the Applicant has not been, prior to the time of determination, ‘genuinely’ trying to reach agreement.

[146] The Respondent further submits the Respondent’s evidence indicates the Applicant continues not to be ‘genuinely’ trying to reach agreement. This is set out in greater detail below.

[147] ‘Genuinely trying’ to reach an agreement involves a finding of fact applied by reference to the circumstances of the particular negotiations. The Commission must assess all the relevant circumstances to establish whether the applicant has met the test or not.

[148] A finding that an applicant has not been, or is not, genuinely trying to reach agreement will necessarily involve accepting evidence establishing that the applicant had some other, extraneous purpose. An example of when an applicant may be found not to be genuinely trying to reach agreement will include where the evidence demonstrates that the applicant’s true motivation is to ‘apply pressure in pursuit of political or environmental goals or simply to punish the employer for some perceived wrong doing’.

[149] The Respondent’s evidence is that:

a. On 30 September 2016, an in-principle agreement was reached between the Respondent and the Applicant and endorsed by employees who would be covered by the proposed Agreement.

b. On 15 November 2016, following a workforce meeting at which the Applicant was present, the employees unanimously voted down an enterprise agreement that reflected the in-principle agreement that had been reached.

c. Between 30 September 2016 and 15 November 2016:

i. the Respondent issued an employee and long term member of the Applicant with a ‘show cause’ letter notifying him it was proposing to terminate his employment.

ii. the parties provided a written response and attended a conference in the Commission in relation to an industrial dispute regarding consultation, in which the Respondent clearly stated its position with respect to the interpretation of the consultation and dispute resolution clauses in the 2013 Agreement.

iii. the Respondent advised the Applicant it would be happy to consider using electronic rather than a show of hands method of voting if employees would prefer.

d. On 15 November 2016, the Applicant notified the Respondent of the reasons why the vote had been unsuccessful.

e. Four of the five reasons given directly aligned with the events that occurred between 30 September 2016 and 15 November 2016.

f. Since 15 November 2016, the Applicant has not resiled, or demonstrated any willingness to resile, from its position with respect to those reasons.

[150] The Respondent submits the Applicant has not given genuine consideration to its latest position in the bargaining. The Applicant has not sought a meeting with the Respondent to discuss the Respondent’s proposed compromise on the five additional claims, and has instead rejected that compromise out of hand.

[151] Further, the Respondent submits the Applicant’s actions in pursuing the five additional claims are designed to punish the Respondent for some perceived ‘wrongdoings’.

[152] Accordingly, the Respondent submits that the Applicant has not been, and continues not to be, genuinely trying to reach agreement.

[153] The expression ‘genuinely trying’ in section 443(1)(b) of the Act is concerned with the genuineness of the efforts to reach the stated goal of an enterprise agreement. It is directed at the authenticity of an applicant’s efforts to reach that goal. The genuineness or authenticity of an applicant’s efforts to reach that goal will turn on its motivation - the intention, object or purpose.

[154] For the Commission to be satisfied that a bargaining representative has been, and is, genuinely trying to reach an agreement, at the very least, an applicant must be able to demonstrate that it has clearly articulated the major items it is seeking for inclusion in the relevant agreement, and provided a considered response to any demands made by the other party.

[155] The Respondent’s evidence is that it has received three separate logs of claim, and five subsequent additional claims, during the bargaining process.

[156] The Respondent submits the Applicant has failed to clearly articulate in the course of bargaining the major items it is seeking to have included in the relevant agreement.

[157] It is submitted the Respondent’s evidence establishes that on 15 November 2016, the Applicant acted capriciously and disingenuously by:

a. actively encouraging employees to reject an enterprise agreement which had previously been endorsed by the Commission, reviewed by the Applicant and agreed to in-principle by the Applicant and employees; and

b. changing the goal posts by seeking to bargain in relation to five additional claims that had either been ‘dropped’ or had not been raised, by the Applicant previously during bargaining.

[158] It is submitted the Respondent’s evidence establishes that since 15 November 2016, the Applicant has acted capriciously and disingenuously by:

a. failing to give the Respondent adequate time to consider and respond to the additional claims; and

b. failing to give genuine consideration to proposals put forward by the Respondent in relation to the five additional claims.

[159] The Respondent submits the Applicant has, through the conduct of its Branch Secretary Mr Chris Cain, engaged in unlawful coercion in contravention of section 343 of the Act.

[160] Specifically, the Applicant threatened to take action against the Respondent with an intent to coerce:

a. the Kwinana plant operators to exercise their workplace right to vote on the proposed new agreement in a particular way; and

b. the Respondent not to exercise its workplace right to terminate the employment of an employee pursuant to clause 36 of the 2013 Agreement.

[161] Where there is evidence of unlawful conduct engaged in during the course of bargaining, the Respondent submits the Commission cannot be satisfied that the party engaging in the unlawful conduct has been ‘genuine’ in their efforts to reach agreement.

[162] The concepts of ‘genuinely trying to reach agreement’ under section 443(1)(b) and good faith bargaining under section 228 of the Act should not be conflated. Nevertheless, it must be recognised that there is a relationship between the two concepts.

[163] It is submitted the evidence of Ms Ross clearly demonstrates that the Applicant failed to disclose relevant information to the Respondent prior to the vote being conducted with respect to the proposed Agreement on 15 November 2016.

[164] Specifically, Ms Ross’s evidence demonstrates that the Applicant failed to disclose prior to the vote that its bargaining position had changed on a number of items and failed to seek the Respondent’s response in relation to those changes.

[165] Previous decisions of this Commission have noted the importance of parties putting their final bargaining position to other bargaining representatives, and seeking their response, prior to a vote being conducted. 17

[166] If, between 30 September and 15 November 2016, the Applicant had been genuinely trying to reach agreement with the Respondent, it would have notified the Respondent in a timely manner that there were five additional items that required consideration before the formal vote was conducted, and sought to negotiate these with the Respondent.

[167] Instead, the Applicant facilitated an unsuccessful vote and effectively blindsided the Respondent.

[168] The Respondent submits the Commission cannot be satisfied, in light of this failure by the Applicant, that the Applicant has been genuinely trying to reach agreement with the Respondent throughout the bargaining.

[169] Section 443(5) of the Act provides that if the Commission is satisfied there are exceptional circumstances justifying the period of written notice that must be provided of any industrial action being longer than 3 working days, the protected action ballot order may specify a longer period.

[170] In the event the Commission determines it is appropriate for it to grant the application in this matter, the Respondent submits there are exceptional circumstances justifying an increase in the written notice period, to seven working days.

[171] What is required when determining whether exceptional circumstances justify an extension of the required notice period is a weighing of the interests of the employer and third parties in the employer having a greater opportunity to take appropriate defensive action, against the diminution in the effectiveness of the employees’ bargaining power that results from such an extension.

[172] The application contemplates industrial action being taken in the form of work stoppages of various lengths and for possible consecutive periods, indefinite bans on employees working ‘overtime’, indefinite bans on employees performing ‘higher duties’ and indefinite bans on employees working during scheduled meal breaks.

[173] The Respondent’s evidence is that due to the amount of shipping scheduled to take place at the Kwinana Terminal in March and April 2017, a stoppage of work of even four hours will have a significant impact on the Respondent’s customers, in the sense that it will lead to a backlog of grain to be outloaded and orders to be filled. This backlog will be difficult to clear in the event a ban on employees working additional hours or shifts is implemented on short notice.

[174] If the Respondent is given only three working days’ notice of any work stoppage that will affect the outloading of grain at the Kwinana Terminal, its customers will have insufficient time to rearrange their commercial arrangements with their buyers, meaning the customers will incur significant penalties.

[175] However, if the Respondent was able to give its customers seven working days’ notice of any work stoppage, the customers will be better placed to rearrange their commercial arrangements with their buyers to minimise the impact on the customer.

[176] Notably, the action will still have an impact on the Respondent’s own operations even if seven working days’ notice is given, meaning that extending the notice period is unlikely to diminish the effectiveness of the employees’ bargaining power that results from taking the action.

[177] To lessen the impact of any stoppage of work or indefinite ban on the performance of additional hours/shifts on its customers, the Respondent could look to utilise alternative forms of labour. This is particularly the case in the event of an extended work stoppage or indefinite ban on the performance of additional hours/shifts.

[178] If the Commission were to decide that a notice period under section 414(2) of only three working days is appropriate, this would leave the Respondent insufficient time to induct any alternative plant operators to perform the work safely.

[179] The Respondent’s evidence is that it is required to submit its proposed train delivery schedule to Brookfield and Watco on the Monday of the preceding week.

[180] If the Commission were to decide that a notice period under section 414(2) of only three working days is appropriate, this is likely to have an impact on Watco’s ability to manage driver fatigue.

[181] However, if the period of notice for work stoppages and bans on ‘overtime’ was extended to seven working days, this would enable to Respondent to notify Brookfield and try to adjust the seven day rail schedule so Watco can manage train driver fatigue appropriately.

[182] The Respondent submits the Applicant has filed no witness evidence in relation to this issue.

Legislation

[183] Section 443 of the Act sets out when the Commission must make a PABO in relation to a proposed enterprise agreement.

“443 When the FWC must make a protected action ballot order

(1) The FWC must make a protected action ballot order in relation to a proposed enterprise agreement if:

(a) an application has been made under section 437; and

(b) the FWC is satisfied that each applicant has been, and is, genuinely trying to reach an agreement with the employer of the employees who are to be balloted.

(2) The FWC must not make a protected action ballot order in relation to a proposed enterprise agreement except in the circumstances referred to in subsection (1).

(3) A protected action ballot order must specify the following:

(a) the name of each applicant for the order;

(b) the group or groups of employees who are to be balloted;

(c) the date by which voting in the protected action ballot closes;

(d) the question or questions to be put to the employees who are to be balloted, including the nature of the proposed industrial action.

(3A) For the purposes of paragraph (3)(c), the FWC must specify a date that will enable the protected action ballot to be conducted as expeditiously as practicable.

(4) If the FWC decides that a person other than the Australian Electoral Commission is to be the protected action ballot agent for the protected action ballot, the protected action ballot order must also specify:

(a) the person that the FWC decides, under subsection 444(1), is to be the protected action ballot agent; and

(b) the person (if any) that the FWC decides, under subsection 444(3), is to be the independent advisor for the ballot.

(5) If the FWC is satisfied, in relation to the proposed industrial action that is the subject of the protected action ballot, that there are exceptional circumstances justifying the period of written notice referred to in paragraph 414(2)(a) being longer than 3 working days, the protected action ballot order may specify a longer period of up to 7 working days.

Note: Under subsection 414(1), before a person engages in employee claim action for a proposed enterprise agreement, a bargaining representative of an employee who will be covered by the agreement must give written notice of the action to the employer of the employee.”

Consideration

Not genuinely trying to reach an agreement

[184] I will firstly consider the argument by CBH that the bargaining representative in this matter, the MUA, has not been and is not genuinely trying to reach an agreement with CBH.

[185] The history of this matter detailed above relevantly is that on 30 September 2016 the CBH employees unanimously agreed to accept in-principle the proposed terms for an enterprise agreement which had been endorsed by Commissioner Cloghan the previous day, following a series of conferences held with the parties. However on 15 November 2016 these employees unanimously voted to reject the enterprise agreement, drafted in consultation with the MUA, which reflected those proposed terms the employees had previously accepted. The MUA advised CBH after the meeting that there were five issues the employees wanted resolved before an agreement can be accepted which were:

Voting process to be inserted saying for the replacement agreements in future to be voted on by a show of hands and meetings held in accordance with provisions of the proposed Agreement.

Consultation and change provision needs to be amended to protect the rights of employees to ensure CBH complies with the intent of the clause.

Status quo definition needs to be improved to ensure CBH complies with the intent of the status quo provisions.

Disciplinary procedure to be inserted into the proposed Agreement.

The employees want to revisit income protection on the basis that the MUA has now clarified that the cost of the claim e.g. 2% of wages would be inclusive of all fees and charges.

[186] It is helpful to consider the genesis of each of these issues in turn.

Voting process to be inserted saying for the replacement agreements in future to be voted on by a show of hands and meetings held in accordance with provisions of the proposed Agreement

[187] The disagreement between the parties which was the background to this issue began around 4 November 2016, after the 30 September 2016 vote, following a debate between CBH and the MUA as to how long CBH was willing to pay employees for the meeting on 15 November 2016 and a suggestion by CBH that if necessary the alternative approach would be to conduct an electronic vote rather than a show of hands.

Consultation and change provision needs to be amended to protect the rights of employees to ensure CBH complies with the intent of the clause and status quo definition needs to be improved to ensure CBH complies with the intent of the status quo provisions

[188] Both the consultation about change issue and the status quo issue arose out of a dispute first raised with CBH by employees on 19 September 2016. However it was not until 24 October 2016 that CBH advised the MUA they believed the disputes procedure in the 2013 Agreement had been exhausted which caused the MUA to file an application regarding the engagement of casual employees, which involved these issues of consultation and status quo, on 25 October 2016. It was not until 3 November 2006, after the 30 September 2016 vote, that at the direction of the Commission, CBH served on the MUA a response to the MUA’s application which explained CBH’s position on consultation and status quo.

Disciplinary procedure to be inserted into the proposed Agreement

[189] This issue arose out of CBH issuing a show cause letter to an employee Mr Willis on 24 October 2016, after the 30 September 2016 vote. In response to this the MUA on 31 October 2016 sent a letter to CBH which in its conclusion referred to concerns about the disciplinary process and the MUA’s desire to develop an improved disciplinary procedure to be included in the proposed 2016 Agreement.

The employees wanted to revisit income protection on the basis that the MUA has now clarified that the cost of the claim e.g. 2% of wages would be inclusive of all fees and charges

[190] The claim for income protection had been dropped by the MUA during the negotiations on the understanding that the employees were lukewarm about this however during the meeting on 15 November 2016 the employees expressed a different view as Mr Cassar explained in his evidence as follows.

“That’s a claim that had been dropped, but now, by 15 November, it’s back on the table?---Once everybody was having their debate again and the question was being asked, “why did you drop it?” I said, “Look, if you’re really married to it” - I didn’t think that the company would - I didn’t think it was going to be an issue, to be quite honest, because the employees would have to pay for it. I just explained how it would work and that they would have to forego wage increases if they wanted, it couldn’t be an extra claim because we had already achieved agreement in-principle. I felt that that would be an extra claim for a new claim, if you like, if we wanted wage increase and - so all is said to them was, “Look, if you really wanted, you would have to forego wage increase to pay for it. If you’re willing to do that, I'll go back to the company. I don't think it will be an issue.” - That was my view.

And that was at the meeting on the 15th?---I believe so, yes. It had to be, yes.” 18

[191] What this demonstrates is that, other than for income protection which was an issue raised by employees at the meeting on 15 November 2016, these issues evolved as concerns for the employees due to intervening events that occurred between the first in-principle vote on 30 September 2016 and the vote rejecting the enterprise agreement weeks later on 15 November 2016. The evidence is that from the employee’s perspective the circumstances they found themselves in on 15 November 2016 were different on a number of fronts than was the case on 30 September 2016 and it was because of this they voted the enterprise agreement down on 15 November 2016 and through their bargaining representative wanted to pursue these five issues further in bargaining with CBH.

[192] Whilst the MUA was aware of these issue prior to the meeting on 15 November 2016 the extent to which these issues together had altered the view of the employees to the proposed enterprise agreement could not be known with certainty until the meeting was held.

[193] The existence of these intervening events and the change of approach by the employees at the meeting on 15 November 2016 to income protection I accept were legitimate reasons for them rejecting the enterprise agreement at that meeting. Given the MUA’s role in this situation is to act as the bargaining representative for these employees I do not accept that in the circumstances as explained above it can be said that the MUA has not been and/or is not genuinely trying to reach agreement.

[194] With respect to the phone call by Mr Cain to Mr Capper on 24 October 2016 CBH argue this was a form of coercion and Mr Cain’s statement that he would attend the next meeting to ensure the proposed Agreement was voted down demonstrates the MUA were not genuinely trying to reach an agreement. I note the evidence of Ms Ross was that neither Mr Capper nor herself were concerned about this statement from Mr Cain. Whilst I accept Mr Cain said he would ensure the prosed Agreement was voted down at the next meeting Mr Capper’s evidence was that Mr Cain made this statement in the context of expressing concern as to how CBH had handled Mr Willis’s situation and that he wanted to make changes to the proposed Agreement in the form of a clause relating to disciplinary matters. 19

[195] It is self-evident that the point Mr Cain was making was that absent a clause which the MUA felt properly dealt with their concerns about how CBH handled disciplinary matters he would agitate to see the proposed agreement voted down. This position of the MUA, as stated by Mr Cain, was that they were genuinely trying to reach an agreement but only one which includes particular terms. It certainly was coercive behaviour by Mr Cain but it was aimed at achieving the inclusion of a particular term in the agreement not to thwarting any agreement being reached at all. This cannot be said in my view to be a case of the bargaining representative not genuinely trying to reach agreement.

[196] CBH ask the Commission to infer from the events here, including Mr Cain’s phone call to Mr Capper, that the MUA improperly influenced the employees vote at the 15 November 2016 meeting. There is however no direct evidence to support the inference CBH asks the Commission to draw; in fact the direct evidence is the MUA did not recommend anything to the members. 20 The MUA should not be surprised at CBH’s assertion in the circumstances. The MUA’s preferred approach to meetings of members is to ensure the decisions of members are always unanimous.21 This approach hides the extent of alternative views held by members that are contrary to the majority view. This is facilitated by the MUA’s insistence on voting by a show of hands which is likely to discourage dissenters publicly voting against the majority. The resulting lack of transparency as to their members’ range of opinion invites scepticism, when an employer is told that the MUA members have voted “unanimously” once in favour of an agreement and once against an agreement as occurred in this matter.

[197] Separately since 15 November 2016 CBH say that the MUA has been unwilling to compromise on the five outstanding issues they are pursuing. Whilst this clearly amounts to hard bargaining by the MUA negotiations have been continuing between the parties at conferences convened under section 240 the Act. The MUA’S behaviour since 15 November 2016 does not amount to not genuinely trying to reach agreement.

[198] Finally there is no evidence here that the MUA’s efforts are not genuine because they are motivated by some other purpose than reaching an agreement.

[199] Whilst it is reasonable and unsurprising for CBH to be frustrated and annoyed by the change in direction of their employees between 30 September 2016 and 15 November 2016 and their uncompromising stance since then, the fact this has occurred does not demonstrate that the MUA, as their bargaining representative, has not been and is not genuinely trying to reach an agreement.

[200] The context in which parties negotiate with each other can and does change over time. Their respective circumstances are not static. In other instances an employer may experience an unexpected significant change in its business or financial circumstances which would warrant it withdrawing offers it had previously made during bargaining. Provided these changes are disclosed by the employer the consequential change in bargaining position is not capricious conduct and would likely not be contrary to the good faith bargaining requirements of section 228 of the Act.

[201] In conclusion I am satisfied for the purposes of section 443(1)(b) of the Act that the MUA has been and is genuinely trying to reach an agreement with CBH.

The questions

[202] The Respondent raised objections regarding the questions to be put to employees.

[203] The application as amended resolves some of those concerns. 22

[204] Separately a relatively minor re-drafting of the questions to be put to employees on CBH’s evidence I am satisfied will resolve some other concerns as to the clarity of the proposed industrial action. 23

[205] Consequently questions 7, 8 and 9 will read as follows and question 9 will be renumbered 10:

“7 An unlimited number of bans on the performance of extra days for an indefinite duration? Yes/No

8 An unlimited number of bans on performing the night shift in charge role for an indefinite duration? Yes/No

9 An unlimited number of bans on acting up as a relief supervisor for an indefinite duration? Yes/No

10 An unlimited number of bans on the performance of work during a scheduled meal break? Yes/No”

Are there exceptional circumstances justifying a longer period of notice under section 414(2)(a) of the Act?

[206] I accept the unchallenged evidence of Mr Bignell as to the consequences of protected industrial action on CBH itself, its customers and the third-party rail operators and users Brookfield and Watco. I am satisfied that his evidence demonstrates in this case that there are exceptional circumstances that justifies the period of written notice referred to in paragraph 414(2)(a) of the Act being longer than three working days.

[207] Balancing the interests of CBH and the third parties who will be affected with the reduction in the impact of protected industrial action caused by being required to give a longer period of notice I have decided that the period of written notice required to be given in this case should be five working days for all forms of authorised industrial action other than bans on the performance of extra days.

Conclusion

[208] I am satisfied that the MUA have made an application under section 437 of the Act and has been and is genuinely trying to reach an agreement with CBH. I am satisfied that all the other requirements for a PABO to be issued have been met and so the Commission must make a PABO in relation to the proposed enterprise agreement.

[209] The PABO [PR590710] will be issued in conjunction with this decision.

COMMISSIONER

Appearances:

L. Edmonds on behalf the Applicant.

K. Reid of Minter Ellison on behalf the Respondent.

Hearing details:

2017.

Perth:

February 1.

1 [2017] FWC 149.

2 Transcript at PN232 and PN239.

3 Ibid., at PN250.

4 Ibid., at PN251.

5 Ibid., at PN258.

6 Ibid., at PN260.

7 Ibid., at PN269 to PN283.

8 Ibid., at PN286 and PN287.

9 Ibid., at PN296.

10 Exhibit R3, Attachment NR22.

11 Transcript at PN432.

12 Exhibit R2.

13 Transcript at PN690.

14 Ibid., at PN774.

15 [2015] FWCFB 210.

16 [2015] FWCFB 379 at [49].

17 CEPU v Pro-Built Control Pty Ltd[2013] FWC 2640 and CEPU v Contact Electrical Pty Ltd[2012] FWA 8137.

18 Transcript at PN282 and PN283.

19 Exhibit A1 at paragraph 19.

20 Transcript at PN502 and PN504.

21 Ibid., at PN266 and PN913.

22 Ibid., at PN24 to PN47.

23 Ibid., at PN749 to PN752.

Printed by authority of the Commonwealth Government Printer

The Maritime Union of Australia v Co-Operative Bulk Handling Limited T/A CBH Group