TWU v Veolia Transport Queensland Pty Ltd

[2011] FWA 5691

[2011] FWA 5691

FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.229 - Application for a bargaining order

Transport Workers' Union of Australia
v
Veolia Transport Queensland Pty Ltd
(B2011/3285)

COMMISSIONER ASBURY BRISBANE, 23 AUGUST 2011

Application for a bargaining order- incorrect statement made by employer in relation to protected industrial action - finding that incorrect statement was unfair conduct that undermines collective bargaining - Order delaying ballot of agreement made.

THE APPLICATION

[1] This is an application by the Transport Workers Union of Australia (TWU), under s. 229 of the Fair Work Act (the Act), seeking bargaining orders against Veolia Transport Queensland Pty Ltd (Veolia). The Orders sought by the TWU are in the following terms:

“1. The Respondent (Veolia Transport Queensland Pty Ltd) refrain from putting any proposed enterprise agreement to a vote of employees until the later of the following:

a. at least the matters set out in paragraphs 2-4 have been complied with; or

b. a period of 28 days has elapsed;

2. Veolia Transport Queensland Pty Ltd issue a Staff Bulletin retracting its Staff Bulletins of 9, 10 and 11 August 2011;

3. Veolia Transport Queensland Pty Ltd, other than in compliance with Paragraph 2, desist from issuing any other staff bulletins in relation to industrial action;

4. Veolia Transport Queensland Pty Ltd give genuine consideration to the Applicant’s [TWU’s] claims and counter-proposals to Veolia Transport Queensland Pty Ltd’s claims.”

[2] The TWU contends that Veolia is not bargaining in good faith, in breach of s. 228(1) of the Act, and has engaged in capricious and/or unfair conduct that undermines freedom of association and collective bargaining. Essentially that conduct is the issuing of Staff Bulletins in relation to the taking of protected industrial action, which are said to be false and misleading, and designed to deter TWU members from taking such action. It is also contended that in seeking to put a proposed enterprise agreement to a ballot of employees, in circumstances where Veolia has engaged such conduct, Veolia is undermining collective bargaining. The TWU further contends that employees will misconceive their bargaining power or accept terms of an enterprise agreement that they otherwise would not, on the assumption that protected action is not available to them.

[3] Evidence in support of the application was given by:

• Adam Michael Carter, Legal Officer of the Queensland Branch of the TWU;
• Andrew Kerridge, TWU Delegate, Bargaining Representative and employed by Veolia as a bus driver; and
• Kelly Maree Thomas, Solicitor, Maurice Blackburn Lawyers.

[4] Evidence in opposition to the application was given by:

• Findlay Calderwood, Strategy and Corporate Governance Manager of Veolia;
• Colin Jennings, Managing Director of Veolia;
• Mark Abraham, Bargaining Representative and employed by Veolia as a bus driver;
• David Keane, Bargaining Representative and employed by Veolia as a bus driver.

The application was made on Tuesday 16 August 2011 and heard on Friday 19 August 2011. The TWU was represented by Ms T Butler, Solicitor, Maurice Blackburn Lawyers. Veolia was represented by Mr J Murdoch SC instructed by Mr H Lepahe, Solicitor, Mills Oakley Lawyers.

LEGISLATIVE PROVISIONS

[5] Section 229 of the Act deals with the circumstances in which a bargaining representative may apply for a bargaining order. Compliance with this provision is not in issue in these proceedings, and it not necessary to set out its terms. By virtue of s. 230(1) of the Act, Fair Work Australia (FWA) may make a bargaining order in relation to a proposed enterprise agreement, if: an application has been made; the requirements of the section have been met; and FWA is satisfied that it is reasonable in all of the circumstances to make the order. The terms s. 230(1) require that FWA is satisfied that each of these conditions is met before deciding whether to make an order.

[6] In making a bargaining order, FWA must be satisfied, in all cases, one of the requirements set out in s. 230(2) applies. Relevantly, for the purposes of this application, the employer has agreed to bargain or has initiated bargaining for the agreement: s. 230(2)(a).

[7] Section 230(3)(a) requires that in all cases, FWA must be satisfied that one or more of the bargaining representatives for the Agreement have not met, or are not meeting the good faith bargaining requirements, or that the bargaining process is not proceeding efficiently or fairly because there are multiple bargaining representatives for the Agreement. The good faith bargaining requirements are set out in s. 228 of the Act in the following terms:

“s228. Bargaining representatives must meet the good faith bargaining requirements

(1) The following are the good faith bargaining requirementsthat a bargaining representative for a proposed enterprise agreement must meet:

(a) attending, and participating in, meetings at reasonable times;

(b) disclosing relevant information (other than confidential or commercially sensitive information) in a timely manner;

(c) responding to proposals made by other bargaining representatives for the agreement in a timely manner;

(d) giving genuine consideration to the proposals of other bargaining representatives for the agreement, and giving reasons for the bargaining representative‘s responses to those proposals;

(e) refraining from capricious or unfair conduct that undermines freedom of association or collective bargaining;

(f) recognising and bargaining with the other bargaining representatives for the agreement.

(2) The good faith bargaining requirements do not require:

(a) a bargaining representative to make concessions during bargaining for the agreement; or

(b) a bargaining representative to reach agreement on the terms that are to be included in the agreement.”

[8] Section 230(3)(b) requires that FWA be satisfied that the applicant for a bargaining order has complied with the requirements of s. 229(4) in relation to notifying relevant bargaining representatives of concerns, unless by virtue of s.229(5) FWA is satisfied that it is appropriate that the application be considered in circumstances where the applicant has not complied with s. 229(4).

[9] The matters a bargaining order must specify and the kinds of orders FWA may make, are set out in s. 231 of the Act. Relevantly, in NUW v CHEP Australia Pty Ltd 1 Vice President Watson was considering an application for orders that an employer cease to conduct an agreement ballot, until four meetings were held and that the Union could reapply for further meetings if the parties had been unable to reach agreement. This was held to be an attempt by the Union to prevent a vote, which was the culmination of a bargaining process directly with employees, in favour of an indefinite bargaining process between the Company and the Union. It was also noted in that case that the Union became involved very late in the process; did not take up opportunities to participate in negotiations; did not have legitimate standing as a bargaining representative; and did not represent a majority of employees.2

[10] His Honour held that s. 255(1)(c) of the Act did not preclude an order being made by FWA to delay a ballot for approval of an agreement, provided that such a delay was for a short time, and did not in substance, deny employees an opportunity to vote for an agreement. It was noted that in a given case, the facts will need to be considered to determine whether intervention of this nature, in deferring a vote, has the effect precluded by s. 255. His Honour also observed that it was strongly arguable that the orders sought by the Union in the circumstances of that case, could be described as having the effect of requiring employees not to approve the agreement. 3

[11] The exercise of the power to make a bargaining order is discretionary, 4 and such an order may only be made if FWA is satisfied that it is reasonable in all of the circumstances to do so.5 The power to make bargaining orders should be viewed in the context of the provisions of the Act in relation to enterprise agreements and also in the context of those dealing with protected industrial action.

[12] The provisions of the Act in relation to Enterprise Agreements are found in Chapter 2 Part 2-4. The Objects of that part, as set out in s. 171 include:

“(a) to provide a simple, flexible and fair framework that enables collective bargaining in good faith, particularly at the enterprise level, for enterprise agreements that deliver productivity benefits; and

(b) to enable FWA to facilitate good faith bargaining and the making of enterprise agreements, including through:

(i)

(ii) making bargaining orders; ...”

In LHMU v Foster’s Australia Pty Ltd 6Senior Deputy President Kaufman observed that:

“It is apparent that the Act has created a scheme whereby bargaining for an enterprise agreement is encouraged. During the course of bargaining it is legitimate to take protected industrial action, provided that the statutory requirements have been met. The application for a protected action ballot and the taking of industrial action that may be authorised by such a ballot are some of the legitimate bargaining tactics that a union may engage in to further or strengthen its bargaining position.” 7

FACTS

[13] The Veolia Transport Queensland Pty Ltd Brisbane Pty Ltd Union Collective Agreement 2008 - 2010 passed its nominal expiry date on 31 December 2010. A Notice of Employee Representational Rights pursuant to s. 173 of the Act was issued to relevant employees on 15 October 2010, by Veolia.

[14] There have been some 27 bargaining meetings between November 2010 and 12 August 2011, in pursuit of negotiating an agreement, without success. Bargaining has been conducted between Veolia and the TWU as bargaining representative for its members, along with three bargaining representatives appointed by employees and known as the Independent Agreement Group (IAG). There is also a member of the TWU who is a bargaining representative on his own behalf. There are some 83 members of the TWU to be covered by the proposed agreement. There is no evidence as to how many employees are represented by the IAG, other than from Mr Keane who is representing himself and two other employees. The TWU members constitute the majority of employees to be covered by the proposed agreement.

[15] Some 14 versions of the proposed agreement have been developed with the most recent version being issued on 10 August 2011. Mr Calderwood and Mr Jennings said in their evidence that Veolia, through its representatives at enterprise bargaining meetings, had bargained in good faith and met its obligations under the Act. Mr Jennings asserted that TWU representatives had not bargained in good faith and had not genuinely been trying to reach agreement. Mr Abraham and Mr Keane also gave evidence critical of TWU representatives alleging that they were back tracking; going off on different tacks during bargaining; and arguing about wording rather than substantive issues. Further, Mr Abraham and Mr Keane alleged that representatives of the TWU threatened to push them out of the negotiations if they did not work with the Union.

[16] On 2 June 2011, the Tribunal as presently constituted issued an Order under s. 443 of the Act for a protected action ballot. 8 The ballot was conducted by the Australian Electoral Commission in accordance with the Order, and the results were declared on 23 June 2011. Industrial action was authorised by the ballot in forms including an unlimited number of stoppages of work for 4 hours and an unlimited number of stoppages of work for 8 hours. On 21 and 22 July 2011, TWU members employed by Veolia at its Capalaba Depot engaged in stoppages for 24 hours and 4 hours respectively.

[17] On 5 August there was a meeting for the purposes of negotiating the proposed enterprise agreement. During that meeting, Veolia representatives indicated that in their view, bargaining had reached an impasse, and stated their intention to put a version of the proposed agreement, containing the Company’s best and final offer, to a ballot of employees. It is clear from the evidence that the IAG representatives agreed with this proposal. There are some conflicts in the evidence about the position of the TWU representatives in relation to the ballot proposal. After considering the evidence, I am satisfied that one TWU representative agreed that with the ballot proposal and said that he would support the proposed agreement; and the other TWU representatives, including Mr Kerridge said that the Company could put the proposed agreement out for a vote but they would not support it.

[18] Mr Jennings indicated to the meeting that the Company would work towards finalising the Agreement and cleaning up the wording so that it could be put out to employees for consideration by 17 August and a ballot held seven days thereafter. Mr Jennings said that in his view, at the end of the meeting on 5 August it was clear that the TWU representatives thought that it was more appropriate for the Agreement to be put to employees for their determination given that negotiations had reached an impasse, although he also believed that the Union would not actively support the approval of the Agreement at the ballot.

[19] Mr Jennings also said that on 5 August 2011 there was a request by the TWU to have a two hour stop work meeting to discuss the proposed agreement. Mr Jennings asked whether the Union was going to support the Agreement, and on being told “No”, indicated that the Company did not consent to a paid stop work meeting.

[20] By letter of 8 August 2011 the TWU notified Veolia of industrial action pursuant to s. 414 of the Act, involving a four hour stoppage from 4.00 am on Friday 12 August 2011. Mr Jennings said that this notice was given despite the Union agreeing to put the approval of the proposed agreement to a ballot of employees, and came as a surprise to the Company. Mr Jennings also said that there were numerous discussions with various advisors to the Company about this matter.

[21] On 12 August 2011, Mr Jennings wrote to the bargaining representatives advising that the Company had put its final position in relation to the proposed agreement and was prepared to deal with questions on clarification of the proposed agreement, up until close of business on 16 August 2011. The letter went on to state that on 17 August 2011, Veolia would be issuing employees with a copy of the proposed agreement and notices under s. 180(3) of the Act in relation to the time, place and method for a ballot. The letter also indicated that an explanation of the terms of the proposed agreement would be provided to employees. 9

[22] On 16 August 2011 Mr Jennings emailed the State Secretary of the TWU inviting the Union to participate in a communication process to explain the terms of the Agreement to employees. 10

[23] Mr Calderwood’s evidence is that a ballot in relation to the proposed agreement will be conducted over the period from 31 August to 2 September by the Australian Electoral Commission, and that employees and bargaining representatives will be issued with appropriate notices prior to the ballot. The timing of the ballot was arranged between Veolia and the AEC.

THE STAFF BULLETINS

[24] Mr Jennings said that the genesis of Staff Bulletins was a belief that TWU bargaining representatives were not providing information to members of the Union in relation to bargaining for the proposed agreement. From late June or early July 2011, the Company issued staff with Bulletins, to update them about the bargaining process, outstanding matters and the next steps in the negotiating process. The method of distribution of Staff Bulletins was to leave a copy in the pigeon hole of each driver and to leave copies in the lunch room and other locations around the Depot.

[25] Given the change in circumstances as perceived by Mr Jennings, between 5 August when it was agreed that there would be a ballot, and 8 August when he was notified of further industrial action, it was decided that a Staff Bulletin would be issued to employees. That Bulletin, issued on 9 August 2011, is under the signature of Mr Jennings, and contains the following opening paragraph:

“We have received notification from the Transport Workers Union (TWU) that they will be taking industrial action again in the form of a work stoppage from 4.00 am -8.00 am on Friday 12 August. This action is disappointing and we believe unnecessary because we have been bargaining in good faith and thought we had reached an agreement. We have received advice that the planned stoppage is unlawful.” 11

[26] At 10.30 am on Wednesday 10 August 2011, Mr Heinz Lepahe of Mills Oakley Lawyers, on behalf of Veolia, forwarded a letter to Mr Carter by email, in the absence of the State Secretary of the TWU. Essentially the letter stated that the industrial action notified by the TWU and scheduled for 12 August 2011 will be unlawful and unprotected, on the grounds that it would not be taken within 30 days of the date of the protected action ballot. The letter went on to request that the notification be withdrawn by 2.00 pm on that date. Further, the letter stated that if unlawful industrial action was taken, Veolia reserved its right to seek damages against the State Secretary of the TWU, the organisation and employees who participated. 12

[27] At 12.01 pm on Wednesday 10 August 2011, Mr Carter of the TWU responded to the letter from Mills Oakley Lawyers setting out the legal basis for the TWU contention that the industrial action notified for Friday 12 August 2011 would be protected and lawful. Essentially the letter states that if industrial action is commenced within 30 days of a protected action ballot, the action can continue, provided that it is action of the same type. The letter goes on to state that the last sentence of the first paragraph of the Staff Bulletin of 9 August 2011 is misleading and false, and demands that it be removed from publication immediately and corrected. Further the letter states that if the Bulletin is not withdrawn and corrected, the TWU will file proceedings in FWA and if necessary, the Federal Magistrates Court, seeking declarations and pecuniary penalties against Veolia and Mr Jennings. 13

[28] On 11 August 2011 Mr Lepahe wrote to Mr Carter stating that Veolia did not agree with the TWU submission that the proposed stoppage is protected industrial action, and accepting the offer to correct the staff bulletin on a without prejudice basis. 14 In the corrected Staff Bulletin attached to the letter of 11 August, the sentence at the end of the first paragraph has been replaced with the following:

“We have received advice that the planned work stoppage may be unlawful and we are waiting on further legal advice before taking any further steps in this regard.”

[29] At 10.00 am on 11 August 2011, Mr Carter wrote to Mr Lepahe, advising that the TWU did not accept that the updated bulletin was issued on a without prejudice basis, and again asserting that the statement about the industrial action is false and misleading. The letter goes on to request a correction and withdrawal of the statements, in specified terms, by 12 noon on that date and states that if this does not occur the matter will be referred to solicitors for the TWU. 15 At 11.39 am Mr Lepahe forwarded a letter to Mr Carter indicating that the deadline of 12 noon was unreasonable and that a response would be provided by 2.00 pm.16 Mr Carter responded by sending an email to Mr Lepahe at 12.57 pm, informing him that further correspondence in relation to the matter should be forwarded to the solicitors for the TWU, Maurice Blackburn, to the attention of Ms Teri Butler.17

[30] On 11 August 2011, Mr Lepahe wrote to Mr Carter 18 and Ms Butler19 indicating that:

• Veolia did not resile from the position in its letter of 10 August 2010;



• Veolia would take the step of withdrawing the staff bulletin that the TWU had complained about on a without prejudice or without admissions basis; and

• Employees who would be covered by the proposed agreement and represented by the TWU, would be advised that the company would treat any industrial action taken by them on 12 August 2011 as protected and they would suffer no repercussions.

[31] not accepted, and that the withdrawal of the bulletin is to prevent the TWU from masking its own lack of support, by making the Company, Mr Jennings and Mills Oakley Lawyers, the issue. 20 The letter to Ms Butler asserts that: “we believe on reasonable grounds that your client is engaged in unprotected industrial action” on the basis that the provisions of the Act dealing with protected action are new, and the case law cited by Mr Carter in the letter of 10 August 2011 relates to previous legislation, containing different provisions. That letter goes on to state that Veolia is entitled to its views, and should be able to express them and test the meaning and interpretation of new laws.21

[32] On 11 August 2011 Veolia issued a third version of the Staff Bulletin and amended the last sentence of the first paragraph to read as follows:

“I would like to advise that the Company will not take any action against eligible staff who wish to participate in the work stoppage. Any action taken by eligible staff will be treated as protected industrial action”. 22

[33] In relation to the first Staff Bulletin issued on 9 August 2011, Mr Jennings said that the statement made in the last sentence of the first paragraph is wrong and does not represent the Company’s position on the proposed industrial action. This was said to be an error and not intended to influence employees not to take industrial action, or their right to freedom of association. The subsequent iterations of the Staff Bulletin were an attempt to correct the error in the first Bulletin.

[34] Mr Kerridge said that he took the statement in the first Staff Bulletin to mean that the advice received by Veolia was legal advice and was concerned about the statement and believed the TWU needed to answer it. The second version of the Staff Bulletin was provided to Mr Kerridge at a meeting on 10 August at approximately 3pm. According to Mr Kerridge, there was a discussion at that meeting during which Mr Jennings said that Veolia had received advice that the period for industrial action had expired and that industrial action on Friday 12 August would be unlawful. Mr Calderwood mentioned the Workplace Relations Act and the Fair Work Act when explaining why Veolia believed that the industrial action was unlawful. Mr Jennings also said that a decision on whether drivers are fined would be made by a court of law and the fine for individuals stands at $7,500 and for the TWU, $34,000. Mr Kerridge tendered contemporaneous notes of the meeting of 10 August to support his version of the discussion. 23

[35] Mr Kerridge said that the amended Staff Bulletin and the comments of Mr Jennings made him even more concerned about the legality of the industrial action scheduled for 12 August 2011. Mr Jennings maintained that he said at the meeting of 10 August 2011, that the industrial action may be unlawful not that it would unlawful. Mr Jennings also maintained that he stated that if the industrial action was unlawful, he believed that the fines under the Act are $7,500 for individuals and $34,000 for companies.

[36] In relation to the third version of the Staff Bulletin Mr Kerridge said that the wording suggested to him that Veolia considered that it had the right to take action against those who chose to participate in industrial action, but would not do so for some reason or another. Mr Kerridge also said that he was disappointed in the turnout at the stop work meeting on 12 August 2011, compared to the turn out at the meeting in July 2011. Mr Kerridge expressed his ongoing concern that members of the TWU may consider that industrial action taken on 12 August was unlawful, and may vote for any agreement put out to ballot because they feel that they have no other option but to do so. Mr Kerridge agreed under cross-examination that a text message was sent by the TWU to members prior to the stoppage on 12 July, in the following terms:

“Veolia claims the action on Friday is unlawful. Thats CRAP. Your action is PROTECTED, and LAWFUL. Meet at 6.00am Koala Pub as planned. Come and have your say.” 24

[37] On 12 August 2011, a letter was forwarded to Mr Lepahe under the signature of Ms Butler, said to constitute written notice on behalf of the TWU to Veolia for the purposes of s. 229(4) of the Act. The letter set out a number of complaints, in similar terms to the issues ventilated by the TWU in these proceedings, and indicated that if an adequate response was not received by close of business on Tuesday 16 August 2011, that the TWU would seek the assistance of FWA including by seeking good faith bargaining orders. 25

[38] Mr Lepahe forwarded a letter to Ms Butler on 16 August 2011, indicating that it was the response of Veolia for the purposes of s. 229(4)(c) of the Act, and refuting the contentions set out in Ms Butler’s letter. 26

SUBMISSIONS

Submissions for the TWU

[39] It was submitted for the TWU that Veolia has not met the good faith bargaining requirements and has engaged in capricious or unfair conduct that undermines freedom of association or collective bargaining. In doing so, Veolia has not complied with the good faith bargaining requirement found in s. 228(1)(e) because it has failed to refrain from engaging in such conduct. It was further submitted that conduct that undermines the right to strike undermines freedom of association and collective bargaining. Conduct such as that of Veolia, aimed at, or likely to have the effect of misleading workers as to their rights to take protected industrial action, clearly meets the test of being conduct that undermines freedom of association and/or collective bargaining.

[40] The relevant conduct is said to be the publication, on three separate occasions, of misleading statements in relation to employees taking protected industrial action, and in that context, commencing the process to arrange to have employees vote on an enterprise agreement. In light of the detailed response provided by the TWU to the statement made in the first Staff Bulletin, the Company maintaining that the industrial action may be unlawful on the basis that the legislation is new and has not been considered by FWA, is a very “skinny” premise.

[41] It was also submitted that the third Staff Bulletin does not correct the misleading statement and there is a clear implication that the Veolia can take action against employees but is exercising forbearance in choosing not to. Further, the third Staff Bulletin was not issued until 2.00 pm on the day before the date that protected industrial action was to take place. On any fair view, the effect of the industrial action was mitigated because the number of participants was minimised by the employer’s conduct, and this can be inferred to be in part, attributable to the Bulletins. Three incorrect and misleading Bulletins compounded this effect.

[42] The statement in the first Bulletin was careless. The statement in the second Bulletin was made without any proper basis and was capricious or unfair. The statement in the third Bulletin was also unfair and the cumulative effect of the Bulletins caused TWU members to question whether the action on Friday 12 August would be lawful.

[43] The TWU wants to reach agreement with Veolia. That Veolia has declared in correspondence that the parties have reached an impasse, does not prevent bargaining orders from being made, and a party cannot unilaterally declare that negotiations are at an end and that the good faith bargaining requirements no longer have any application 27. In any event, the TWU disputes the assertion that negotiations have reached an impasse, and contends that there are a large number of issues which remain outstanding, as reflected in the letter sent by the TWU to Veolia on 19 July 2011, querying provisions in the then current version of the agreement28 which are also found in the final proposal. The TWU contends that no response has been received to this letter.

[44] The TWU is prepared to continue to bargain with Veolia and also wishes to ensure that its members are able to exercise their rights to take protected industrial action as contemplated under the statutory scheme. It is further submitted that the orders sought are modest and are aimed at:

(a) giving the parties a reasonable time - 28 days - to correct the misinformation distributed by the employer; and

(b) in the meantime, requiring the employer to genuinely consider any claims and counter proposals put by the TWU.

[45] In all of the circumstances, it is reasonable to make the orders requested and FWA should exercise its discretion to make those orders.

Submissions for Veolia

[46] It is submitted for Veolia that the Bulletins complained of by the TWU were the product of legal advice, and whether that advice is correct or not, is inconsequential and should be dealt with in the Federal Magistrates Court, if the Union pursues the action foreshadowed in its correspondence. In issuing the Bulletins, Veolia and/or its managers did not act capriciously and there was no unfairness if the Bulletins were issued in good faith with the object of reflecting legal advice. The issuing of the first Bulletin was an innocent oversight.

[47] The critical requirement in s. 230(1)(c), that an order must not be made unless it is reasonable in all of the circumstances, has not been met. During the hearing Veolia indicated that it was prepared to offer an undertaking in the following terms:

“For the period leading up to the ballot of the Agreement, Veolia undertakes to issue no Staff Bulletins which express a view about the legality or otherwise of any industrial action that may be notified by the TWU Queensland.

All commentary in Staff Bulletins will be limited to operational matters.

Veolia will be entitled to remind non-members of the TWU of their ineligibility to pursue protected action notified by the TWU.”

[48] In light of this undertaking, the third point of the orders sought by the TWU is without utility. It was further submitted that there is no utility in the orders to the extent that they sought a retraction of the Bulletins. Notwithstanding this offer the TWU pressed its application for an order in relation to the issuing of Staff Bulletins. It was also submitted for Veolia that events have come and gone, and the stoppage of 12 August 2011 has already taken place. The restraint on the employer conducting a ballot in relation to the Agreement is the key item sought in the proposed orders. There is no justification for such an order. After ten months and multiple meetings, Veolia desires that its best and final offer in relation to the terms of the proposed agreement go to a ballot of employees.

[49] It was further submitted that the evidence establishes that on 5 August 2011, there was a consensus among the bargaining representatives that this occur. The bargaining representatives from the IAG have manifested a desire for the Agreement to go to a ballot of employees. There is evidence of a minor disagreement between the TWU bargaining representatives, during which two representatives agreed that the ballot should occur, and Mr Kerridge said nothing. This consensus was said to be a powerful reason for not delaying the ballot and permitting it to go ahead.

[50] When the third Bulletin was issued, matters were clarified and the TWU had an opportunity to inform members of their rights. Members of the TWU were entitled to take action from 26 June 2011 and had made sparse use of that weapon. There is no current notice in relation to the taking of industrial action. In relation to the industrial action on 12 August 2011, there is no evidence from any person of confusion or concern about taking industrial action, or that they wanted to take action but refrained from doing so because they were influenced by the Bulletins. Where the TWU carries the onus, a central plank of its case fails, because of the absence of such evidence. Orders under s. 229 are serious and have serious implications, and should only be made on the basis of actual evidence, that is credible and reliable.

[51] It was further submitted that the AEC has made itself available to conduct a ballot commencing on 31 August, and if dates are lost, renegotiation with the AEC will be required. This was said to be an important practical consideration. FWA should have regard to the full history over the 10 months of negotiations. In the period before the ballot commences on 31 August, matters where explanation is required could be readily addressed. There is nothing to prevent protected industrial action being taken between now and the date of the ballot. In this regard, the TWU has not sought to exercise that right by giving fresh notices of industrial action. Accordingly the complaint of the TWU is academic, and if there is no proposal between now and the date of the ballot to take industrial action, then there can be no benefit in deferring the ballot.

[52] It is submitted that to delay the ballot will place strain on members of the IAG and disadvantage employees by delaying wage increases that would flow from approval of the Agreement. It is also submitted that the contention of the TWU that there has been a failure to give genuine consideration to its issues with the proposed agreement is without foundation, and that when all of the circumstances are considered, orders are not necessary.

CONCLUSIONS

[53] I am satisfied that an application for bargaining orders has been made in accordance with the requirements of s. 229 of the Act. It is not in dispute that the TWU is a bargaining representative for a proposed enterprise agreement to apply to employees of Veolia. The nominal term of the existing enterprise agreement has expired and it is clear from the evidence that the requirements of s. 229(4) have been met in that the TWU has concerns that Veolia has failed to meet good faith bargaining requirements; has given written notice setting out those concerns; has given Veolia a reasonable time to respond; and considers that Veolia has not responded appropriately to those concerns.

[54] In relation to the requirements of s. 230, it is clear that Veolia has agreed to bargain for an enterprise agreement and accordingly, that one of the necessary requirements of s. 230(2) has been met. The issues for determination are whether Veolia has not or is not meeting the good faith bargaining requirement in s. 228(e), and whether it is reasonable in all the circumstances to make the order.

[55] After considering all of the evidence I am satisfied that in issuing the Bulletins, Veolia has not complied with the good faith bargaining requirement in s. 228(1)(e) in that it has not refrained from capricious or unfair conduct that undermines freedom of association or collective bargaining. I have reached that conclusion for the following reasons.

[56] The first Staff Bulletin containing the statement that industrial action proposed by the TWU for 12 August is unlawful, was issued on 9 August. On 10 August, Veolia’s solicitors made the same assertion in correspondence to the TWU. That correspondence was in response to the notification from the TWU that it intended to take protected industrial action on 12 August 2011, rather than a response to any complaint from the TWU about the statement included in the Bulletin issued on 9 August 2011. The TWU did not make such a complaint until the response to the letter of 10 August 2011 from Veolia’s solicitors. It is also notable that at no time in correspondence with the TWU did Veolia’s Solicitors resile from the assertion that its client Veolia believed that the industrial action proposed for 12 August 2011 would be unlawful and unprotected.

[57] It is arguable that Mr Jennings’ evidence to the effect that the statement in the Bulletin of 9 August was made in error and did not reflect legal advice received by Veolia, is at odds with the chain of correspondence between Veolia’s Solicitors and the TWU. It is also arguable that the statement in the second Staff Bulletin purporting to correct the Bulletin of 9 August, is at odds with the continued assertion of Veolia’s Solicitors on that Veolia maintained the view that the industrial action proposed for 12 August would be unprotected.

[58] Notwithstanding this, I accept that in the cut and thrust of bargaining, as evidenced by the exchanges between Veolia (through its Solicitors) and the TWU, assertions may have been made on behalf of Veolia, in stronger terms than were intended to be included in a communication to employees, and that the statement in the Bulletin issued on 9 September was an error. It is also the case that legal advice provided to Veolia may have differed from the position asserted in the correspondence between its Solicitors and the TWU. On balance, I accept that the first statement in the Bulletin of 9 August was made in error and was not intended to mislead employees or misrepresent their right to take protected industrial action.

[59] I am of the view that the second statement in the Bulletin issued on 10 August, viewed in isolation, is not on its face, misleading. I accept that the argument advanced by Veolia’s Solicitors as to why its client held the view that the proposed industrial action on 12 August would be unlawful, may have had limited prospects of success. However, I also accept that Veolia was entitled to put that argument. Viewed in isolation, the second statement puts employees on notice that Veolia may have an argument as to whether industrial action they were proposing to take would be unlawful.

[60] It is also the case that the third statement in the Bulletin issued on 11 September, viewed in isolation, or only in the context of the second statement, is nothing more than Veolia asserting that although it may have the right to seek a remedy in the event that its view about the industrial action being unlawful and unprotected was correct, it had decided not to do so.

[61] While the first statement in the Bulletin issued on 9 August was made in error, the second statement in the Bulletin issued on 10 August was made in circumstances where Veolia sought to assert a position, the correctness of which it was not certain of. The statement in the third Bulletin indicates that Veolia had decided to waive any rights it may have to seek a remedy, if its assertion that the proposed industrial action was not protected proved to be correct. I am unable to accept, on the evidence before me, and on the basis of the arguments in the hearing of Friday 19 August, that the statements in isolation, or cumulatively, constitute an attempt to intentionally mislead employees and misrepresent to them their rights to take protected industrial action.

[62] However, that is not the end of the matter. In my view it is not necessary for the conduct to be intentionally misleading, or to constitute misrepresentation, in order for a finding to be made that it is capricious or unfair. In the present case, a statement was made in a Bulletin issued to staff, about industrial action proposed by the TWU, that on Mr Jennings’ evidence, was incorrect and contrary to Veolia’s policy. That error was compounded by the statement in the second Staff Bulletin. At best, Mr Jennings made that statement not knowing whether or not it was correct. The third statement further compounded the error. It was “crafted” in a way that implied that industrial action proposed to be taken by members of the TWU on 12 August, was not protected.

[63] The end result was a lack of clarity and a level of ambiguity about the right of TWU members to take protected industrial action in circumstances where management of Veolia did not know whether or not the statements they made were correct. The statements were made by the Managing Director of a company with a substantial number of employees, significant resources and access to legal advice. They were made directly to employees in circumstances where protected industrial action by those employees had been notified and was scheduled to occur within a short space of time. No action was taken by Veolia to seek an order on the basis of its assertion that industrial action on 12 August would not be protected.

[64] The statements were made in a period of three days prior to the industrial action notified by the TWU and the last of those statements was issued on the afternoon before the proposed industrial action was due to commence. The evidence of Mr Kerridge, which I accept, is that the statements caused him concern about whether the proposed industrial action was protected. Further, I accept that by engaging in discussion about fines which are applicable to employees who engage in unprotected industrial action at a meeting attended by Mr Kerridge and other TWU members, Mr Jennings added to the concerns of Mr Kerridge about the status of the industrial action. Mr Kerridge is a member of the TWU and a bargaining representative for the proposed agreement. He is also a delegate for the TWU. If Mr Kerridge was concerned about these matters, it is more probable than not that other members of the TWU were also concerned. I also accept Mr Kerridge’s evidence that the number of employees who engaged in industrial action on 12 August was less than the number who engaged in such action in July. It is more probable than not that the statements contained in the Bulletins contributed to this situation.

[65] It is clear from the general tenor of the Bulletin that it was at least in part, directed at discouraging employees from taking industrial action. I entirely accept the right of an employer to communicate directly with its employees and to do so with the intention of discouraging them from engaging in protected industrial action. I also accept the right of an employer to put a proposed agreement out to a ballot of employees, in circumstances where some or all bargaining representatives do not agree with that course of action. However, I do not accept that in taking these steps, the employer can make incorrect or ambiguous statements about the rights of employees in the bargaining process, including the right to take protected industrial action. An employer engaging in such conduct runs a risk of infringing the provisions of the Act dealing with good faith bargaining. The same could be said of any bargaining representative who publishes such statements in relation to the rights and obligations of participants it represents, or other participants in the bargaining process.

[66] In the present case, on 9 August 2011, when the Staff Bulletin containing the incorrect statement was issued, the TWU had notified Veolia of protected industrial action and that action was scheduled for Friday 12 November. That action was to be taken notwithstanding that Veolia had determined that it would put the proposed agreement to a ballot of employees. The acquiescence and/or agreement of TWU bargaining representatives to Veolia’s proposal that the agreement would be put to a ballot of employees did not remove any rights that the members of the TWU had to take protected industrial action.

[67] When the first bulletin was issued members of the TWU had a period of 23 days before the ballot in relation to the agreement was scheduled to commence. During that time such members could have taken protected industrial action provided they complied with the provisions of the Act in relation to notification. Further, employees would have been in a position to consider the proposed agreement, with all of their options open to them - i.e. accept the terms of the proposed agreement or pursue improvements through taking protected industrial action. During that time Veolia could have withstood the protected industrial action as it has on past occasions, or changed its position in relation to its best and final offer.

[68] The right to take protected industrial action during the bargaining process, including periods when a proposed agreement is being considered by employees, is a fundamental one. The conduct of Veolia, in issuing a Staff Bulletin on 9 August 2011 containing an incorrect statement about the rights of members of the TWU to take protected industrial action interfered with that right in a way that was unfair, in that it undermined the ability of union members to participate in collective bargaining to the full extent provided under the Act. The issuing of two further Staff Bulletins did not correct the first statement with sufficient clarity to overcome the effect of the first statement, and made the entire situation ambiguous. I do not consider that the conduct was capricious, in circumstances where there was error involved.

[69] Accordingly, I am satisfied that in all of the circumstances of this case, the discretion to grant a good faith bargaining order has been triggered. The next issue for determination is whether, it is reasonable in all of the circumstances to make such an order.

[70] It is clear from the evidence that bargaining between the parties in these proceedings has been protracted and difficult. However, there is insufficient evidence to establish that this can be attributed to a failure on the part of the TWU bargaining representatives to meet good faith bargaining requirements. I do not accept that bargaining representatives of Veolia could reasonably have believed that on 5 August 2011, they had consensus or agreement from the TWU bargaining representatives, in relation to a ballot being held such that it was not reasonable for TWU members to subsequently take protected industrial action. At best, there was agreement to the ballot and the substance of the proposed agreement from one TWU representative (who was arguably acting as his own bargaining representative and not on behalf of TWU members generally) and acquiescence from the remaining TWU representatives to the proposed agreement being put to a ballot, on the basis that they would not support the substance of the proposed agreement. The statement in the Staff Bulletin that representatives of Veolia: “thought we had an agreement” is surprising in light of the evidence about the state of play after the meeting on 5 August.

[71] I do not accept that the fact that events have come and gone and that TWU members have taken industrial action on 12 August, provides a basis for not exercising the discretion to make a good faith bargaining order. In this regard, I do not accept that an order can have no utility, or that it is more appropriate that the TWU pursue this matter in the Federal Magistrates Court. In my view, the position that the TWU was in prior to the publication of the incorrect statement, can be re-established through the mechanism of a good faith bargaining order. For these reasons I do not accept the submission that the complaint of the TWU is academic.

[72] It is true that an explanation could be provided to the TWU in relation to issues of concern it has about the terms of the proposed agreement without a bargaining order being made. But for the Bulletins, that explanation would have been provided in an environment where the union and its members had 23 days in which to pursue and consider the explanation and where the right of TWU members to take protected industrial action had not been unfairly undermined.

[73] That the AEC has made itself available to conduct the ballot, and any delay will require renegotiation with the AEC, is not grounds for refusing to make an order which has the effect of delaying a ballot. There is nothing to prevent Veolia from negotiating with the AEC for another date on which the ballot can commence.

[74] That wage increases may be delayed if there is an order delaying the ballot is not a ground for refusing the order. It is clear that the TWU is well aware of this possibility, and is nonetheless intent on pursuing a better outcome for its members. That the TWU may not succeed in its objective, is not a ground for refusing to make a good faith bargaining order.

[75] An order delaying the ballot for a 23 day period will not prevent the ballot from being conducted or affect the right of Veolia to put its best and final offer for an Enterprise Agreement to a ballot of its employees. This is not a case where a union has become involved in negotiations late in the process. The TWU has participated in negotiations, has legitimate standing as a bargaining representative and represents a majority of employees who will be covered by the proposed agreement.

[76] On balance, I have decided that it is reasonable in all of the circumstances to make an order under s. 230 of the Act, to the effect that Veolia refrain from causing any proposed enterprise agreement to be put to a ballot of employees for a period of 23 days from the date that this application was heard, save and except that Veolia may take all necessary steps to meet the pre-approval requirements under the Act so that a proposed agreement may be put to a ballot of employees upon the expiration of the period of 23 days from the date of this decision.

[77] I have also decided that it is not reasonable in the circumstances to direct the order to the other matters sought by the TWU. In this regard, I have considered the submissions and evidence of Veolia in relation to the statements made in the Bulletins. In circumstances where the offending statement giving rise to this order was made in error, I can see no basis for restraining Veolia from communicating with its employees while the bargaining process continues. I am also of the view that it is probable that Veolia, having engaged in some 27 meetings in pursuit of an enterprise agreement, and thus far showing no sign of refusing to discuss matters of concern about its proposals with the TWU, will not embark on such a course at this late stage.

[78] An Order will issue with this Decision.

COMMISSIONER

Appearances:

Ms T. Butler on behalf of the Applicant

Mr J Murdoch on behalf of the Respondent

Hearing details:

2011.

Brisbane:

August 19.

 1   [2009] FWA 202

 2   Ibid at [44]

 3   Ibid [43] - [44].

 4   CFMEU v Tahmoor Coal Pty Ltd [2010] FWAFB 3510 per Giudice J, McCarthy DP and Larkin C at [2]

 5   LHMU v Foster’s Australia Pty Ltd [2009] FWA 750 per Kaufman SDP at [20].

 6   [2009] FWA 750.

 7 Ibid at [17].

 8   PR510120

 9   Exhibit 1 Affidavit of Adam Michael Carter Annexure “AMC12”.

 10   Ibid “AMC13”.

 11   Exhibit 1 Witness Statement of Adam Michael Carter Annexure “AMC4”.

 12   Ibid “AMC5”.

 13   Ibid “AMC6”.

 14   Ibid “AMC7”.

 15   Ibid “AMC8”.

 16   Ibid “AMC9”.

 17   Ibid “AMC10”.

 18   Exhibit 6 Affidavit of Colin Jennings Annexure “CJ2”.

 19   Ibid Annexure “CJ3”.

 20   Ibid Annexure “CJ2”.

 21   Ibid Annexure “CJ3”.

 22   Exhibit 1 Statement of Adam Michael Carter “AMC11”.

 23   Exhibit 2 Statement of Andrew Kerridge “AK-3”.

 24   Exhibit 3.

 25   Exhibit 4 Affidavit of Kelly Maree Thomas Annexure “KMT-1”.

 26   Ibid Annexure “KMT-2”.

 27   CPSU v Red Bee Media Australia Pty Ltd [2010] FWA 9253

 28   Exhibit 5 Affidavit of Findlay Calderwood Annexure “FC13”

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