United Firefighters' Union of Australia

[2013] FWCD 8843

[2013] FWCD 8843

DECISION

Fair Work (Registered Organisations) Act 2009
s.159—Alteration of other rules of organisation
United Firefighters' Union of Australia
(R2013/135)
MR ENRIGHT	MELBOURNE, 6 DECEMBER 2013
Alteration of other rules of organisation.

[1]        On 13 February 2013 the United Firefighters' Union of Australia (the UFUA) lodged

with the Fair Work Commission (the Commission) a notice and declaration setting out
particulars of alterations to the rules of the United Firefighters' Union of Australia.

[2]        The particulars set out alterations to rules 2, 12, 14, 17, 19, 20, 23, 24, 26 and 29 of

the UFUA.

Unfinancial Branches

[3] The purpose of the alterations is to introduce rules pertaining to Branches that have not paid monies payable to the National Secretary and are consequently deemed to be “unfinancial Branches”. An unfinancial Branch would automatically cease to be unfinancial when all outstanding monies were paid.

[4] The alterations also make provision for the status of unfinancial Branches within the UFUA and the duties and obligations of officers and decision-making bodies of the UFUA towards those Branches.

[5] The alteration to Rule 2 introduces the definition of an unfinancial Branch as being “a branch which has not paid monies payable to the National Secretary under rule 29(1) in respect of any two or more quarters.” It clarifies that such a Branch would become unfinancial in accordance with the definition upon the last day of the second quarter and remain unfinancial until all unpaid monies are paid. An unfinancial Branch “ceases to be unfinancial when all outstanding unpaid monies are paid”.

[6] Alterations to sub rules 12(6) to 12(9) expand upon the status of an unfinancial Branch, enabling the National Committee of Management to, by resolution, suspend voting and meeting attendance rights of offices of unfinancial Branches. Amended sub rule 14(8), however, requires the National Secretary to provide copies of National Committee of Management resolutions adopted or carried whilst the Branch is an unfinancial Branch to the Branch Secretary of that unfinancial Branch. Likewise, sub rule 17(4) provides that the National Secretary shall provide copies of National Executive resolutions and policies [2013] FWCD 8843

carried or adopted whilst the Branch is an unfinancial Branch to the Branch Secretary of that
unfinancial Branch.

[7] In order to certify the alterations, I must be satisfied that the rules do not impose upon applicants for membership, or members of the organisation, conditions, obligations or restrictions that are, having regard to Parliament’s intention in enacting this Act and the objects of the Fair Work (Registered Organisations) Act 2009 (the Act) and the Fair Work Act 2009, oppressive, unreasonable and unjust.[1]The question that arises here is whether the

[1]Section 14(1)(c) of the Fair Work (Registered Organisations) Act 2009.

suspension of voting and attendance rights – which apply to the Branch Secretaries, delegates and their substitutes of unfinancial Branches – impose oppressive, unreasonable or unjust conditions or restrictions upon the members or prospective members of that unfinancial Branch.

[8]        In relation to my consideration of this issue, I note the following points.

[9] First, there is established precedent that there is nothing oppressive, unreasonable or unjust about a requirement that constituents (including branches) be financial. I refer here to the Federal Court decision of Re Harry David Krantz; Frederick Edward Priest and

William Alex Smith v Federated Clerk’s Union of Australian SA in which Grey J cited the

following quote from Geneff v Peterson:

In my view a requirement that a branch be financial does not impose conditions that are oppressive, unreasonable or unjust nor is it contrary to the concept of the control of committees of an organization and its branches by the members.[2]

[2]Re Harry David Krantz; Frederick Edward Priest and William Alex Smith v Federated Clerk’s Union of Australian SA

[10] In a subsequent hearing of Geneff v Peterson, His Honour examined the question of whether a rule which provided that a branch of an organisation could not be represented on Federal Council until all capita dues and levies had been paid was objectionable. His Honour provided the following further clarification:

Counsel for Mrs Geneff submitted that rule 16(b) was objectionable because it could operate to deprive a member of the Union, who was financial, from being represented on Federal Council. But that argument overlooks the need of a federal organisation for finance from its constituents. There is nothing oppressive, unreasonable or unjust in a requirement that constituents be financial.[3]

[3]Re Ruth Margaret Geneff v FE Peterson; W Glaringbold; L Farrelly; T Bryden; F Harding; R Broomfield; C George; R

[11] In my opinion, the question is one of balancing competing interests. On the one hand, there is a legitimate right and expectation of members to participate in the affairs of their national organisation through their elected representatives. However, as Geneff v

Peterson suggests, this needs to be balanced against the requirement of a registered

organisation to be financial and its right to receive capitation fees and other legitimate levies
from its branches.

[2013] FWCD 8843

[12] I also note that consequential effects on members of unfinancial Branches are mitigated, at least in part by alterations to sub rules 14(8) and 17(4), referred to above, under which the National Secretary is required to provide copies of National Executive and Committee of Management resolutions to Branch Secretaries of unfinancial Branches. This alleviates the effect on members created by the removal of voting and attendance rights that would otherwise inhibit the flow of information from the national body.

[13] Finally, I note that the National Committee of Management has discretion about whether or not to remove voting and attendance rights. Suspension of these rights is not automatic when a Branch becomes unfinancial and can be applied to unfinancial Branches differentially depending on circumstances. I note also that the Committee may, for any reason and at any time, resolve to restore voting or attendance rights to that Branch.

[14] Whilst it is clear that the unfinancial status of Branch does have consequential effects on the financial members of that Branch, in so far as members are restricted from participating in the affairs of the UFUA by way of their elected representatives, it is my opinion that these restrictions are sufficiently mitigated by sub rules 14 and 17. It is also my opinion that the overriding principle that branches can be “unfinancial” and have limits placed on their rights is supported by case law.

[15] Accordingly, I conclude on balance that the majority of the alterations pertaining to the status of unfinancial Branches are in accordance with, and are not contrary to the Act, the Fair Work Act 2009, modern awards and enterprise agreements, and are otherwise not contrary to law.

[16] However, in my opinion, new sub rule 19(28) does not comply with a number

provisions of the Act. Sub rule 19(28) explicitly removes all obligations of the National
Secretary specified in Rule 19 in relation to unfinancial Branches and states:

(28) All above obligations of the National Secretary do not apply in respect of
unfinancial Branches.

[17] Sub rules 19(1) to (27) outline the powers and duties of the National Secretary of the UFUA, which include the day-to-day management and control of the organisation and the ability to exercise a number of duties given to the National Committee of Management. I consider that the annulment of a number of these sub rules in relation to unfinancial Branches places rule 19 in contravention of a number of provisions of the Act. I have summarised the relevant sub rules below:

The National Secretary has the power and/or responsibility, among other things, to:

 Receive all moneys payable to the National fund and give receipts for the same and
deposit in the appropriate account of the union (sub rule 19(6)).

 Keep proper records of all financial transactions and payments relating to the National fund (sub rule 19(9)).

 Keep proper records of all financial transactions between each Branch and the National Administration (sub rule 19(10)).

 Supply a copy of the auditor’s report and copies of the accounts and statement

prepared in accordance with [the Act] to the members of the UFUA free of charge
(sub rule 19(11)(b)).

[2013] FWCD 8843

 Keep an up-to-date register of Branch Officers and National Officers (sub rule

19(16)).

 Take all reasonable steps to supply the Branches and members with information as to the proceedings of the National Committee of Management, National Executive and the activities of the union generally (sub rule 19(22)).

[18] My concerns with the addition of sub rule 19(28) and its application to the sub rules of rule 19 are explained below.

Receipt of monies by the National Secretary

[19] First, and as outlined above, sub rule 19(6) requires that the National Secretary shall, among other things “receive all moneys payable to the National fund and shall give a receipt for the same and shall deposit the same in the appropriate account of the union in accordance with rule 28(2)”.

[20] The insertion of proposed rule 19(28) would mean that the National Secretary is not obliged to receive monies from unfinancial Branches.

[21] I refer to the decision of Re Conciliation and Arbitration Act 1904 v Re an application by Laurence Francis Howard of an inquiry into an election in the Slaters, Tilers

and Roofing Industry Union of Victoria v Re A Reference O (Slaters, Tilers and Roofing

Industry Union of Victoria).[4]This case dealt with a situation in which an unfinancial member was able to remedy his unfinancial status through payment of outstanding fees. However the member was unable to do so because the union secretary refused to accept the fees. The Federal Court held that in this case the relevant rules of the union could not be fairly construed as resulting in a member being deemed to be unfinancial in circumstances in which he had offered his union dues to the secretary at his office and the secretary had refused to take the payment. Relevantly, the majority stated that if a rule, on its proper construction, had such an effect, then it would contravene section 140(1)(c) of the Act[5]in

that it would impose upon members of the union conditions, obligations and restrictions which, having regard to objects of the Act and the purposes of the registration of organisations under the Act, were oppressive, unreasonable and unjust.

[4][1983] FCA 80 (5 May 1983).

[5] Conciliation and Arbitration Act 1904. This provision is a precursor to section 142(1)(c) of the Fair Work (Registered

[22] It is my opinion that the proper construction of sub rule 19(28) is to remove the obligation of the National Secretary to accept payment of fees, including capitation fees. If there is such obligation, an unfinancial Branch cannot remedy its unfinancial status. As such, the effect of the rule is to impose upon members of that Branch conditions that, having regard to Parliament’s intention in enacting the Act and the objects of the Act and the Fair Work Act, are oppressive, unreasonable or unjust.

Keeping of records by the National Secretary

[23] Sub rules 19(9) and 19(10) require that the National Secretary to keep proper records

of all financial transactions and payments between each Branch and the National
Administration.

[2013] FWCD 8843

[24] In my view, the removal of the National Secretary’s obligation to keep a proper record of monies received from and paid to unfinancial Branches under sub rules 19(9) and 19(10) places rule 19(28) in contravention of section 252. Sub section 252(1) of the Act requires reporting units to keep proper financial records such as will correctly record and explain the transactions and financial position of the reporting unit.

[25] Further, in my opinion, the removal of the obligation of the National Secretary to keep proper records of monies received from, or paid, to unfinancial Branches prevents the national body from keeping its records in such a manner that enables the preparation of a General Purpose Financial Report that gives a true and fair view of its financial position and performance. This would be a contravention of subsection 253(3) of the Act.

Provision of financial documents and auditor’s report to members

[26] Sub rule 19(11)(b) requires the National Secretary to supply a copy the auditor’s

report and copies of the accounts and statements prepared in accordance with the relevant
Act to the members of the Union free-of-charge.

[27] My interpretation of section 19(28) is that it removes the requirement of the National Secretary to provide copies of these documents to members of unfinancial Branches. This, in my opinion, contravenes section 265 of the RO Act, which requires a reporting unit to provide free-of-charge copies of either a full or concise report to its members.

Keeping up-to-date register

[28] Sub rule 19(16) requires the National Secretary to keep an up-to-date register of Branch Officers and National Officers. Sub rule 19(28) removes this requirement in relation to Officers of unfinancial Branches.

[29] It is my opinion that the explicit removal of the requirement to keep a register of unfinancial Branch officers places the UFUA in contravention of section 230 of the RO Act, which, among other things, mandates the keeping of a list of the offices and the persons holding office in the organisation and each branch of the organisation.

Provision of information to members

[30] Finally, sub rule 19(28) explicitly removes the obligation of the National Secretary under sub rule 19(22) to provide Branches and members with information about the proceedings of the National Committee of Management, National Executive and the activities of the union in general. This is inconsistent with the amendment to sub rule 14(8) which requires the National Secretary to provide copies of National Committee resolutions or policies to the Branch Secretary of any unfinancial Branch carried or adopted whilst the Branch is an unfinancial Branch. It is difficult to see how the provision of copies of such resolutions or policies is something other than the provision of “information as to the proceedings” of the decision-making bodies of the organisation.

[31] Consequently, and based on my reasoning outlined above, it is my conclusion that

sub rule 19(28) fails to comply with, and is contrary to several provisions of the Act. I am
therefore unable to certify the addition of new sub rule 19(28).
[2013] FWCD 8843

Severability

[32] I must now turn my mind to whether or not the addition of the new sub rule 19(28) is severable from the remainder of the alterations. In reaching my decision, I refer to the case

In Re Food Preservers’ Union of Australia,[6]in which the question of severing rules was

[6](1988) 79 ALR 138

considered. In their decision, the majority held that: :

....where an organisation has made alterations to a number of its rules, each rule and alteration being completely independent of any other rule or alteration, the Registrar would be free to give his certificate with respect to some of those rule alterations and to refrain from giving his certificate with respect to others. On the other hand, where alterations to rules are dependent upon other alterations to rules, difficulties arise where the certificate is given to some of the alterations and not to others.[7]

[7]Re Food Preservers’ Union of Australia and Another (1988) 79 ALR 138 per Northrop & Ryan JJ at 145.

[33]      Their Honours go on to note:

There would need to be a full examination of all the rules to ascertain whether the meaning and effect of the rules to which the certificate had been altered or modified by the fact that some rules have not come into effect.[8]

[8]Re Food Preservers’ Union of Australia and Another (1988) 79 ALR 138 per Northrop & Ryan JJ at 145.

[34] The question of severability therefore turns upon whether or not the impugned alteration can be regarded as completely independent of the remaining alterations. I would need to be satisfied that the removal of sub rule 19(28) would not affect the meaning or effect of the other alterations.

[35] The alterations before me amend the rules to accommodate the category of unfinancial Branches and clarify their status within the Association. Sub rule 19(28) removes the duties and obligations of the National Secretary in relation to those unfinancial Branches. It is my opinion that the refusal to certify this sub rule has no effect upon the substance or effect of the other alterations. The status of an unfinancial Branch is adequately defined under alterations to rule 2 and 12. The duties and obligations of the officers and decision-making bodies towards unfinancial Branches are adequately summarised, for example, in sub rules 12(6), 12(7), 12(8) 14(4), 14(7), 14(8) and 17(4). Removal of sub rule 19(28) has no bearing upon the interpretation or application of any of these sub rules.

[36] As the removal of sub rule 19(28) does not alter the meaning of the other rule alterations, it is, in my view, able to be viewed as independent of the remaining alterations in the manner contemplated by their Honours in Re Food Preservers’ Union of Australia. Consequently, it is my opinion that sub rule 19(28) is severable from the other alterations contained in the notice of particulars.

[37] On 5 December 2013, the National Secretary of the UFUA, Mr Peter Marshall gave consent, under subsection 159(2) of the Act, for me to make amendments to the alterations for the purpose of correcting typographical, clerical or formal errors. Accordingly the following corrections have been made:

[2013] FWCD 8843

	In proposed rule 2, removal of the letter “r” between the words “any” and “two”.
	In proposed rule 2, replacement of “29” with “29(1)”.

[38] On the information contained in the notice, I am satisfied that the alterations have been made under the rules of the organisation.

[39] It is my opinion that, with the exception of sub rule 19(28), the alterations comply with and are not contrary to the Act, the Fair Work Act 2009, modern awards and enterprise agreements, and are otherwise not contrary to law. With the exception of the alterations to sub rule 19(28), I certify accordingly under subsection 159(1) of the Fair Work (Registered

Organisations) Act 2009.

DELEGATE OF THE GENERAL MANAGER

Printed by authority of the Commonwealth Government Printer

<Price code A, PR544379>

[1984] FCA 322; 8 IR 454 (2 November 1984), para 11 per Grey J citing Geneff v Peterson [1980] FCA 104; (1980) FLR

64 at 67.

Smith; K Boyd; P McGarry and K Collins and the Clothing and Allied Trades Union of Australia [1984] FCA 208 (27

July 1984) at para 24.

Organisations) Act 2009 and is substantially the same in its wording and effect as sub section 142(1)(c) of the Act.