Transport Workers' Union of Australia v Skywest Airlines (Australia) Pty Ltd

[2011] FWA 5082

[2011] FWA 5082

FAIR WORK AUSTRALIA

DECISION AND

REASONS FOR DECISION

Fair Work Act 2009
s.739 - Application to deal with a dispute

Transport Workers' Union of Australia
v
Skywest Airlines (Australia) Pty Ltd
(C2011/3934)

COMMISSIONER CLOGHAN PERTH, 29 AUGUST 2011

Application to deal with a dispute.

[1] On 7 April 2011 the Transport Workers’ Union (TWU) (“the Applicant”) made application to Fair Work Australia (FWA) seeking that the Tribunal deal with a dispute in accordance with a dispute settlement procedure pursuant to s.739 of the Fair Work Act 2009 (“FW Act”).

[2] The TWU is in dispute with Skywest Airlines (Australia) Pty Ltd (“Skywest Airlines” or “the Employer”).

[3] The dispute has been referred to FWA pursuant to Clause 9 Dispute Settlement Procedure (DSP) of the Skywest Airlines Pilots Agreement 2010 (“the Pilots Agreement”).

[4] The dispute set out in the schedule attached to the application is as follows:

“1. Skywest Airlines (“Skywest”) and the TWU are in dispute regarding the introduction of a new aircraft type, the ATR 72.

2. In or about early 2011 Skywest informed its pilots that it had made a decision to introduce a new aircraft type, the ATR 72. As the ATR 72 is an aircraft type that has not previously been operated by Skywest there is no classification for this type of aircraft in the Skywest Airlines Pilots Agreement 2010.

3. The Skywest pilots and the TWU have had discussions with Skywest regarding the proposed introduction of the ATR 72 aircraft, and in particular, the variation of the Agreement to provide for a new classification for ATR 72 pilots however, the parties have been unable to reach an agreement concerning this matter.”

[5] The application was the subject of a conference on 2 May 2011. At the conclusion of the conference, the parties had exhausted discussions in an attempt to resolve the dispute and it was agreed that the dispute proceed to arbitration.

[6] I requested the parties at the conciliation conference on 2 May 2011 to reduce the dispute to a question(s) to be answered at arbitration. The parties were unable to agree upon the question(s) to be arbitrated. Further, in considering the question(s) for arbitration, the Employer, on 9 May 2011, raised the matter of whether FWA had the jurisdiction to arbitrate an outcome consistent with the relief sought by the TWU.

[7] The matter was originally set down for hearing on 20 and 21 June 2011, but with the agreement of the parties, was relisted for 28 and 29 July 2011.

[8] At the hearing, Mr Dzieciol represented the TWU and Mr Blackburn of counsel for Skywest Airlines.

[9] While both parties, in accordance with the procedural orders, provided documentation relating to both the jurisdictional objection and the substantive issue in dispute, it was agreed that only the jurisdictional objection be heard and determined initially. The outcome of the jurisdictional objection would determine whether it would be necessary to consider the substantive matter contained in the application.

[10] At the conclusion of the hearing, I reserved my determination. Having considered the documentary material and oral submissions, this is my Decision and Reasons for Decision.

RELEVANT BACKGROUND FACTS

[11] Skywest Airlines is a major regional airline in Western Australia. Skywest Airlines currently operates a fleet of 18 aircraft consisting of nine (9) Fokker 100 jets, eight (8) Fokker 50 turbo prop and one (1) Airbus A320-200 jet.

[12] On 10 January 2011, Skywest Airlines and Virgin Blue Holdings Ltd announced that they had entered into a 10 year strategic alliance agreement.

[13] As part of the strategic alliance agreement, it was announced on 23 February 2011, that Skywest Airlines would be using the ATR 72 aircraft.

[14] Skywest Airlines is the employer party to the Pilots Agreement.

[15] The Pilots Agreement does not provide, in Appendix B Wages and Pay Scales, for a rate of pay for an ATR 72 aircraft.

[16] The TWU is seeking rates of pay for flight crew in a new classification of ATR 72 to be incorporated in Appendix B of the Pilots Agreement and consequential amendments to various allowances.

[17] Skywest Airlines submits that the ATR 72 aircraft is comparable to the Fokker 50 aircraft, and the pay rates and allowance for the Fokker 50 aircraft should apply to the flight crew of the ATR 72 aircraft.

[18] Skywest Airlines concedes that it did not consult or discuss specifically with the Skywest Airlines Pilots Association (SALPA), the proposal to operate the ATR 72 aircraft and associated conditions, prior to the announcement on 23 February 2011. Skywest Airlines adopted this course of non disclosure, it states, for reasons of confidentiality.

DISCUSSIONS ON APPROPRIATE RATE OF PAY AND ALLOWANCES FOR FLIGHT CREW OF ATR 72 AIRCRAFT

[19] On 3 February 2011, at a meeting of the Workplace Relations Committee (WRC), which had been established pursuant to the Pilots Agreement, management representatives of Skywest Airlines advised SALPA of the proposed strategic alliance but did not inform SALPA of the proposal to utilise the ATR 72 aircraft and its view on the appropriate conditions of employment for the flight crew.

[20] Following the announcement on 23 February 2011 of the utilisation of the ATR 72 aircraft as part of the strategic alliance, Skywest Airlines wrote to the SALPA Committee on 1 March 2011. The relevant part of the communication is as follows:

“I would ask that you convene a meeting of the WRC as soon as practicable to support the aforementioned project [employment of pilots for the ATR 72 aircraft as part of the strategic alliance]. It is our intention to offer the pilots that will be flying the ATR type aircraft a fleet wage equivalent to what currently exists for the F50 pilots as was negotiated in the 2010 EBA” 1. (my emphasis)

[21] On 2 March 2011, SALPA responded, in part, as follows:

“It is the belief of the committee that there has been no offer, re the ATR, reasonable enough to discuss at a committee level.

Therefore the committee has decided that there are two options open to the company.

1. Come back to the committee with a reasonable enough offer, that we can discuss and maybe to support and sell to the pilot body.

2. Present the current suggestion to the pilot body for a vote, which we believe will be rejected” 2.

[22] On 8 March 2011, the WRC again met and discussed the issue under the heading “ATR Project”, the pay scales for ATR 72 flight crew. SALPA rejected the pay rate proposed by Skywest Airlines. It is specifically recorded in the minutes of the meeting that SALPA’s rejection was based on “attraction” reasons. Skywest Airlines supported its position on the rate of pay for flight crew on competitive grounds 3.

[23] The overall discussion on the ATR Project concluded with the comment that a “stalemate” could hold up the introduction of the strategic alliance 4.

[24] On 9 March 2011, the SALPA Committee advised Skywest Airlines that it had met and placed the “matter in the hands of the TWU” 5. The TWU was to arrange a meeting for 21 March 2011 with Skywest Airlines and the SALPA Committee advised that there would be no further communication from the SALPA Committee until the meeting of 21 March 2011 had taken place.

[25] Following the meeting on 21 March 2011, Skywest Airlines wrote to the SALPA Committee on 23 March 2011. Relevantly, the communication states:

“It has however become somewhat obvious that we will struggle to reach agreement on any previously requested changes to the current CA that have been discussed at the recent WRC...

“...Skywest has decided in keeping with all aspects contained within clause 37 of the (Pilots Agreement) not to pursue any further changes to the agreement and thus drop all requests.

“It is decided that we will proceed with the introduction of the ATR and meet all aspects of the Pilots Agreement.

“We have entered into a commercial agreement with DJ in relation to the wet lease of the ATR aircraft type and this wet lease was predicated on the aircraft having the MTOW to that of the F50. Accordingly Skywest intends to proceed with the implementation of the DJ arrangement, in doing so will apply all the provisions of the CA to existing pilots and new pilots...” 6.

[26] On 28 March 2011, SALPA advised Skywest Airlines that its members had rejected, by a vote, the Employer’s proposal to apply the salary scale and allowances for Fokker 50 to flight crew operating the ATR 72 aircraft 7.

[27] No further communication was provided to the Tribunal between SALPA and Skywest Airlines after 28 March 2011.

[28] On 7 April 2011, the TWU made application to FWA.

RELEVANT LEGISLATIVE FRAMEWORK

[29] The TWU has made application pursuant to s.739 of the FW Act.

[30] Section 739 of the FW Act relevantly provides:

(1) This section applies if a term referred to in section 738 requires or allows FWA to deal with a dispute.

(2) …

(3) In dealing with a dispute, FWA must not exercise any powers limited by the term.

(4) If, in accordance with the term, the parties have agreed that FWA may arbitrate (however described) the dispute, FWA may do so.

Note: FWA may also deal with a dispute by mediation or conciliation, or by making a recommendation or expressing an opinion (see subsection 595(2)).

(5) Despite subsection (4), FWA must not make a decision that is inconsistent with this Act, or a fair work instrument that applies to the parties.

(6) FWA may deal with a dispute only on application by a party to the dispute.

[31] Section 739 of the FW Act is applicable if an enterprise agreement includes a term that provides a procedure for dealing with disputes. The Pilots Agreement has such a term which is provided at Clause 9.

[32] Clause 9: Dispute Settlement Procedure of the Pilots Agreement is as follows:

“Subject to the Fair Work Act 2009 (as amended) any dispute or claim (whether any such dispute or claim arises out of the operation of this Agreement or not or whether it is within one State or not) as to the wages and/or conditions of employment of any Pilot with regard to whom the Company bound by this Agreement and/or as to any other industrial matter pertaining to the relations of the Company (to whom this Agreement applies) with the Pilots (with regard to whom the Pilot is so bound) shall be settled in the under-mentioned manner:

(a) The matter will first be discussed between the individual Pilot(s) (a SALPA representative or other representative if requested) and the Manager of Line Operations (or delegate). The Manager of Line Operations (or delegate) shall make a decision and advise the pilot(s) of the decision in writing within 10 days of the meeting;

(b) If the matter is not resolved in the first discussion, it will be referred for discussion between the individual Pilot(s) (a representative of SALPA or other representative and/or the TWU if requested) and the Head of Flight Operations;

(c) If the matter is not resolve in this instance, it will be referred for discussion with the above parties and the Head of Flight Operations / Human Resources Manager as appropriate;

(d) If the matter remains unresolved either party may notify the existence of an industrial dispute to the FWA or agreed chairperson. The FWA or the agreed chairperson can conciliate or arbitrate the matter, as appropriate, and the parties agree to abide by any arbitration or recommendation made.

While the parties attempt to resolve the matter in a bona fide manner, work will continue as normal unless a pilot has a reasonable concern about an imminent risk to health or safety.

Subject to the provisions of clause 12 this clause shall have no application to matters involving Flight Standards, which shall be dealt with in accordance with the CAR’s.

A party shall not be prejudiced as to the final settlement by the continuation of work in accordance with this clause.”

[33] Also relevant to this application are the following provisions of the Pilots Agreement:

Clause 7: Facilitative Provision: Workplace Relations Committee

Skywest Airlines will establish a Workplace Relations Committee (“WRC”) to oversee the flexible application of this agreement to meet the vision of the business. Whilst the composition of the WRC will vary over time with the size, structure and needs of the business, it will comprise of no less than 6 people with an equal number of SALPA committee members and management representatives.

...

The primary roles of the WRC are:

(a) to decide how to handle challenges and changed circumstances that may arise due to the growth of the business;

(b) to oversee the operation of the facilitative provisions of this agreement.

• Clause 37: Introduction of Change or New Equipment

37.1 Employer’s Duty to Notify

Where the company has made a definite decision to introduce major changes to the company that are likely to have significant effects on the Pilots, the company shall convene a WRC meeting to address the change.

Significant changes include termination of employment, major changes in the composition, operation or size of the employer’s workforce or the skills required; the elimination or diminution of job opportunities, promotion opportunities or job tenure; acquisition of new aircraft types and the need for retraining or transfer of Pilots to other locations. Provided that where the agreement makes provision for alteration of any of the matters referred to an alteration shall be deemed not to have significant effect.

37.2 Employer’s Duty to Discuss

The company shall discuss with the parties to this agreement the introduction of the changes referred to in clause 37.1, the effect the changes are likely to have on Pilots, measures to avert or mitigate the adverse effects of such changes on Pilots and shall give prompt consideration to matters raised by the parties to this agreement in relation to the changes.

The discussions shall commence as early as practicable after a definite decision has been made by the company to make the changes referred to in clause 31.

For the purpose of such discussion, the company shall provide in writing to the parties to this agreement, all relevant information about the changes including the nature of the changes proposed, the expected effects of the changes on Pilots and any other matters likely to affect Pilots provided that the company shall not be required to disclose confidential information the discourse of which would be inimical to the employer’s interest.

37.3 New Equipment

The Company shall give as much notice as possible of the introduction of a new aircraft type, which has not previously been operated or not operated during the previous 12 months. At least three months prior to the date that a new type of aircraft is planned to operate in the Company’s fleet the WRC shall meet to agree on an implementation plan.

Minimum experience requirements shall be agreed to by SALPA prior to a new aircraft type being introduced to service.

Such rates of pay, rules and working conditions shall be effective as of the date the equipment is first placed in operation. WRC meetings shall begin within thirty (30) days after a request for a meeting has been made unless otherwise mutually agreed between the parties to this agreement.

Upon the introduction of a new aircraft type or the acquisition of a contract involving unique operations the parties to this agreement will consult to determine the manner in which the aircraft or the operation is introduced.

In the event of the introduction of new equipment, other than additional equipment, by the Company:

All Skywest Airlines Pilots shall maintain their existing base assignments.

Where there is a need to vary from the current company requirements the parties shall discuss the minimum experience requirements for the new equipment to agree that they are fair and reasonable.

The Company may employ contract pilots to facilitate the introduction of new equipment, however prior consultation and agreement with the WRC must be obtained before any contract pilots are employed. All contract pilots will be employed for a set time as determined by the WRC but normally not longer than 6 months.

The loss of bid rights referred to in Clause 10.10 of this agreement may be reviewed during the term of this agreement.

[34] Appendices A and B provide allowances and salaries consistent with aircraft type. The aircraft type designated in the appendices are:

• Fokker 50;



• Fokker 100; and



• Airbus A320-200.

[35] Finally, Appendix C sets out a pro forma letter of employment which states that the employee’s salary will be that applicable to the aircraft type which is currently those aircraft set out in paragraph [34] above.

JURISDICTIONAL OBJECTION

[36] It was common ground between the parties that relevant clauses of the Pilots Agreement applying to the application by the TWU are to be found in Clause 37: Introduction of Change or New Equipment and Clause 9: Dispute Settlement Procedure.

[37] Skywest Airlines submits that FWA has no jurisdiction to deal with the application on four grounds.

[38] The first challenge by Skywest Airlines is that the Pilots Agreement, “read as whole envisages that the rates of pay for a new aircraft will be agreed by the WRC (via clause 37.3 - Introduction of Change and New Equipment) and not arbitrated in accordance with clause 9 - DSP. Clause 9, it is submitted by the Employer, is concerned only with disputes or claims referred by individual pilots relating to their own existing entitlements, and not with general claims for rates of pay for new aircraft.

[39] Counsel for Skywest Airlines submits that the correct approach in determining whether a “seemingly wide disputes procedure” applies, is to examine whether a contrary intention is applicable elsewhere in the enterprise agreement 8.

[40] Skywest Airlines submits that in accordance with subclause 37.3, where it is intended to introduce a new aircraft, it is the WRC which meets and agrees on an “implementation plan” which includes determining the rates of pay applicable to the new aircraft. Further, and importantly, Clause 37: Introduction of Change and New Equipment, “does not provide for the matter to be referred to FWA if the WRC fails to reach agreement” 9.

[41] In short, Skywest Airlines submits that Clause 37 of the Pilots Agreement specifically applies to the introduction of new aircraft. Because there is no express provision to refer the matter to FWA in the event of disagreement on rates of pay applicable to a new type of agreement, it would be wrong to assume that settlement is then reached through Clause 9: DSP which the Employer asserts is concerned with disputes or claims referred by individual pilots.

[42] Counsel for Skywest Airlines relies upon Sydney Ferries Corporation v AMOU [2007] AIRCFB 909; PR979569; CEPU v Hitachi Plant Technologies Pty Ltd, PR983113 and Ansett Pilots Association v Ansett Australia PR8525, in support of its first challenge to FWA having the jurisdiction to deal with the application.

[43] The second challenge to FWA having the jurisdiction to deal with the application is that the application concerns a dispute between the TWU in its own right, and Skywest Airlines, whereas Clause 9: DSP, is concerned with individual disputes between one or more pilots and Skywest Airlines 10.

[44] The Employer submits that the application specifically states that the dispute referred to FWA, is one between the TWU and Skywest Airlines. Further, the documentation provided to FWA for the purposes of the hearing, indicates that the dispute is between either the TWU or SALPA and Skywest Airlines.

[45] Counsel for Skywest Airlines submits that the TWU and SALPA have a representative role in Clause 9: DSP, and are not a party principal to the dispute. As a consequence, only a party principal can refer a dispute to FWA in their own right.

[46] This second challenge, Counsel for Skywest Airlines asserts, is similar to the circumstances in Australian and International Pilots Association v Jetstar Airways Pty Ltd [2010] FWA 1272 and relied upon in supporting its jurisdictional objection.

[47] Skywest Airlines’ third challenge to FWA having the jurisdiction to deal with the application is that, even if Clause 9: DSP, extends to disputes about pay claims for new aircraft type (which is not accepted), the clause provides that the dispute can only be initiated by those individual pilots employed to fly ATR 72 aircraft. To date, no pilot employed to fly the ATR 72 has raised a dispute or concerns with Skywest Airlines.

[48] Consistent with its second challenge, counsel for Skywest Airlines submits that, as no individual pilot has initiated a claim/dispute with the Employer concerning the rate of pay for the introduction of the ATR 72 aircraft, the matter cannot be dealt with through a generalised claim by the TWU and the mechanisms of Clause 9: DSP which relate to individual affected pilots.

[49] The fourth challenge to FWA having the jurisdiction to deal with the application can be described as follows. Even if a dispute over the rate of pay for the ATR 72 could ultimately be referred to FWA (which is not accepted), the mandatory requirements in Clause 9: DSP have not been undertaken before the dispute has been referred to FWA.

[50] Skywest Airlines submits that unless and until the conditions precedent in Clause 9: DSP have been satisfied, FWA has no power to arbitrate. This restraint upon FWA’s powers can be found in subsection 793(3), (4) and (5) of the FW Act.

[51] Counsel for Skywest Airlines relies upon Qantas Airways Limited v TWU [2007] AIRC FB 915 (“Qantas”) in support of this jurisdictional objection to FWA having the power to arbitrate on the application.

DISCUSSION AND CONCLUSIONS

[52] A general requirement for FWA to approve an enterprise agreement is that it contains a term about settling disputes. Such a mandatory provision is not contentious as the benefits of finding an agreed acceptable resolution are numerous - the most obvious being the avoidance of protracted litigation and the uncertainty of arbitration. However, as in this application, FWA cannot force either or both parties to resolve the dispute by conciliation, hence the reason this matter is before me for arbitration (and that is no criticism of either party).

[53] I now turn to the power of the Tribunal to arbitrate this application, which, according to the Applicant, comes from Clause 9: Dispute Settlement Procedure.

[54] The power of the Tribunal to exercise its powers of arbitration is revealed in subclause 9(d) Dispute Settlement Procedure of the Pilots Agreement as follows:

“If the matter remains unresolved either party may notify the existence of an industrial dispute to the FWA or agreed chairperson. The FWA or the agreed chairperson can conciliate or arbitrate the matter, as appropriate, and the parties agree to abide by any arbitration or recommendation made.”

[55] While counsel for the Employer conceded that Clause 9: DSP is not well drafted, it is relevant, in the first instance, to determine when FWA can exercise its power to arbitrate on the dispute.

[56] In Clause 9: DSP, the word “shall” in the preamble declares the intent and will of the parties to clearly and compulsorily obligate themselves to act in a certain way where a dispute is in existence.

[57] While it may be inconvenient, cumbersome or inconsistent with past practice, the literal meaning of the word “shall” requires the parties to act in a certain way before the Tribunal has the power to conciliate or arbitrate in pursuance of Clause 9: DSP.

[58] Consequently, it is necessary to ask the question, as counsel for the Employer inferred, whether the three stage process in Clause 9: DSP has been complied with before the Tribunal can exercise its power of arbitration.

[59] With respect to subclause 9(a) of the DSP, there is no evidence that an individual pilot(s) had discussed the matter with the Manager of Line Operation (or delegate). Further, the Tribunal was not provided with any evidence that the Manager of Line Operation, or his or her delegate, has made a decision on the matter and advised the relevant individual pilot(s) of that decision, in writing, within 10 days as required in subclause 9(a) of the DSP.

[60] With regard to subclause 9(b) of the DSP, even if the provisions of subclause 9(a) had been carried out, which the Employer denies, the Tribunal was provided with no evidence of a further discussion between the relevant individual pilot(s) and the Head of Flight Operation.

[61] Before examining the TWU’s submissions regarding the facts of the discussions on the matter, it is useful to review ss.736 to 740 of the FW Act which are in Part 6-2 which relates to dealing with disputes in enterprise agreements. Section 735 of the FW Act provides that Part 6-2 of the FW Act is about “dealing with disputes between national system employees and their employers” (my emphasis). In view of s.735 of the FW Act, it would be wrong, in my opinion, to construe the meaning of dispute settlement clauses in any way other than disputes between “employees” and “employers” and not between employees’ representatives and employers.

[62] Notwithstanding the implication arising from s.735 of the FW Act, s.737 of the FW Act provides a model term about dealing with disputes which, if adopted by the parties, sets out the role (if appointed) of a representative which is “for the purposes of the procedures in this term [contained in enterprise agreements]” 11. In respect to the model term, it is absolutely clear that the representative is entitled to act and speak for the employee “for the purposes of the procedures in this term”.

[63] The parties to the Skywest Pilots Agreement have chosen not to adopt the model term. In doing so, the role of the representative (whether SALPA or another representative) is uncertain. However, and more importantly, if the role of the representative is to act and speak on behalf of the individual pilot(s), no evidence of the election of a representative was provided by the individual pilot(s) to the Tribunal or the Employer. In my view, it is only fair and reasonable for the Employer to know what representatives they are dealing with in relation to a dispute with their employees.

[64] In response to this situation, the TWU submit that:

“...we would say that the procedure has been followed in the sense that there were two meetings of the Workplace Relations Committee in relation to the introduction of the new aircraft” 12.

“The second one was the meeting at which the issue of pay rates was discussed at some length...so the attendees are at a senior level of the organisation, clearly persons able to make decision and obviously are able to represent the company and to bind the company in relation to any outcomes at that meeting” 13.

“So to say that the steps in the dispute settlement procedure were not followed, in our submission, (is) not correct” 14.

“...However, in this particular case the consultation took place on a number of occasions some weeks apart and with senior levels of management being represented. We say that falls within the intent of the dispute resolution provision and that intent is that obviously the parties try and resolve the dispute between them before the dispute is referred on to the tribunal for conciliation and/or arbitration” 15 (my emphasis).

[65] There is no doubt that the issue of pay rates for the ATR 72 was discussed at meetings of the WRC on 3 February and 8 March 2011. Further, the issue was the subject of correspondence between SALPA and the Employer in the context of the WRC meetings on 3 February and 8 March 2011 and a further meeting in the TWU offices on 21 March 2011.

[66] As a finding of fact, I find that the meetings on 3 February, 8 and 21 March 2011 were either WRC meetings pursuant to Clause 37: Introduction of Change or New Equipment of the Pilots Agreement or, in case of the meeting on 21 March 2011, at the TWU offices, following a WRC meeting and at the instigation of SALPA.

[67] There was no evidence that the dispute was discussed by “individual pilot(s)” with the Manager of Line Operation (or delegate) in stage one of the procedures for Clause 9: DSP. There was no evidence that any “individual pilot(s)” had requested SALPA or an “other representative” act on their behalf. In summary, with the exception of the application filed in FWA, none of the meetings or correspondence refer to Clause 9: DSP.

[68] As a consequence, and as the application to FWA is made to deal with a dispute pursuant to a Dispute Settlement Procedure, I find that the conditions precedent to FWA having the power to arbitrate on this dispute, are not present. In reaching this finding, I am cognizant of Qantas.

[69] It was submitted by Mr Dzieciol for the TWU, that the TWU have had discussions with Skywest and the parties have been unable to reach agreement; that is true. But, Mr Dzieciol goes on to submit that Clause 9: DSP “has to be read by reference to the custom and practice in the industrial arena” 16. Although Mr Dzieciol did not provide any evidence concerning custom and practice, it would only be of assistance if Clause 9: DSP was uncertain or unambiguous such that extraneous evidence should be applied to the term to assist in giving meaning to its intent. In this application, I find that the intent of Clause 9: DSP is clear and that before FWA has the power to arbitrate, certain mandatory steps are required - which, in this case, have not been carried out.

[70] Finally, the TWU concedes the meeting on 21 March 2011 was not “held under the auspices of the WRC” 17 - this is also true, but I am unable to find that this meeting and the subsequent correspondence between Skywest and SALPA constitutes meeting the mandatory requirements of Clause 9: DSP of the Pilots Agreement.

[71] Subsections 739(3), (4) and (5) of the FW Act make it clear that the Tribunal powers to arbitrate in any particular dispute are limited to the provisions of the FW Act and the terms of a fair work instrument. In this application, the powers of FWA to arbitrate are enlivened after certain mandatory conditions have been carried out. These conditions have not been carried out. Consequently, the FW Act, at s.739(5), prevents the Tribunal from making the decision to arbitrate if it is inconsistent with the terms of the Pilots Agreement. Accordingly, I cannot arbitrate on this application.

[72] As a consequence of my decision in relation to Clause 9: DSP, it is unnecessary to address the remaining jurisdictional objections. I have only examined the mandatory conditions precedent in Clause 9: DSP, as they were the basis upon which this application was made.

[73] Should the mandatory conditions precedent be complied with, then it is open to the Applicant to make a further application to FWA should it wish to do so. In doing so, further consideration may be necessary of the Employer’s jurisdictional objections relating to, in particular, Clause 37: Introduction of Change or New Equipment.

[74] While considerable submissions were made regarding the meaning of Clause 37: Introduction of Change or New Equipment, a cornerstone to the Clause is the “Employer’s Duty to Discuss” as it is described in the subheading to subclause 37.2. Disputes usually have many “fathers”, and in this case, the first piece of correspondence from the Employer to the SALPA Committee concerning the rate of pay for flight crew on the ATR 72 reads:

“...It is our intention to offer the pilots that will be flying the ATR type aircraft a fleet wage equivalent to what currently exists for the F50 pilots as was negotiated in the 2010 EBA.”

[75] The Employer in requesting the convening of the Workplace Relations Committee to discuss the implementation plan for the Strategic Alliance, appears to have already formed a view on the pay rates for the ATR 72 aircraft. I suspect that this view was formed during the commercial negotiations leading to the Strategic Alliance.

[76] In my view, given the significant reliance by the Employer on Clause 32: Introduction of Change or New Equipment, any proposal on such a sensitive issue as rate of pay should be carried out without, in the first instance, signalling a fixed position. Further, where there is a “Duty to Discuss”, the Employer ought to have set out and provided information on the significant matters which it considers relevant to the rates of pay, provided adequate time for the other party to respond and given diligent consideration to any response as part of the discussion or consultation.

CONCLUSION TO APPLICATION

[77] For the reasons outlined above, the application, pursuant to s.587(3) of the FW Act, is dismissed.

COMMISSIONER

Appearances:

Mr Dzieciol for the Applicant.

Mr Blackburn of Counsel for the Respondent.

Hearing details:

2011:

Perth,

28 July.

 1   Exhibit A1(2)

 2   Exhibit A1 (3)

 3   Exhibit A1 (5)

 4   Exhibit A1 (6)

 5   Exhibit A1 (7)

 6   Exhibit A1 (8)

 7   Exhibit A1 (10)

 8   Exhibit R1 (para 2.1)

 9   Exhibit R1 (para 2.10)

 10   Exhibit R1 (para 3)

 11   Schedule 6.1 Model term for dealing with disputes for enterprise agreements.

 12   PN 237

 13   PN 238

 14   PN 239

 15   PN 242

 16   PN 281

 17   PN 295

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