Wood Australia Pty Ltd T/A Wood v “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers' Union (AMWU)

[2023] FWC 2199

[2023] FWC 2199

FAIR WORK COMMISSION

RECOMMENDATION

Fair Work Act 2009

s.240—Bargaining dispute

Wood Australia Pty Ltd T/A Wood
v

“Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU)

(B2023/859)

COMMISSIONER HUNT BRISBANE, 31 AUGUST 2023

Application to deal with a bargaining dispute

1. On 1 August 2023, a s.448A of the Fair Work Act 2009 (the Act) conference was convened by the Fair Work Commission (the Commission) with respect to bargaining for an enterprise agreement between Wood Australia Pty Ltd T/A Wood (Wood) and its mechanical employees at the Lytton Refinery in Brisbane.

1. The employees are employed pursuant to the Wood (Lytton Refinery – Qld) Mechanical Enterprise Agreement 2020.  The parties have been bargaining for a new agreement since early this year.  The “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) is a union bargaining representative.

1. The negotiations during the s.448A conference were, I consider, fruitful. Nevertheless, the protected action ballot order made on 20 July 2023, with results declared on 3 August 2023, authorised the taking of protected industrial action by relevant members of the AMWU.

1. A vote of employees to approve an agreement was put by Wood to employees with the result on 14 August 2023 an emphatic no vote.

1. On 15 August 2023, protected industrial action was commenced by members of the AMWU, including a ban on overtime.

1. On 17 August 2023, a ban on holding permits was commenced by members of the AMWU.  The AMWU members also engaged in a one-hour stoppage.  The one-hour stoppage was unprotected industrial action as it was not taken in conformity with the notice of protected industrial action.  Wood has suitably deducted four hours’ pay from those members who took unprotected industrial action in accordance with its obligations under the Act.

1. Full-day stoppages have been occurring since 23 August 2023 except for 29 and 31 August 2023. 

1. On 21 August 2023, Wood made an application pursuant to s.240 of the Act for the Commission to deal with a bargaining dispute.  I informed the parties during the s.448A conference that I held the view that the Commission ought only to convene one compulsory conference with the bargaining representatives pursuant to s.448A on account of the statute referencing “a” conference. Accordingly, I was not prepared to order individuals to further compulsory conferences as I did not consider there was authority within the Act to do so.

1. I invited the parties to make a s.240 application in the event the bargaining ran into difficulties and encouraged the parties to respectfully request allocation to me if they so wished.  The s.240 application was allocated to me on 23 August 2023.  On the afternoon of 23 August 2023, I listed the matter for an in-person conference on 24 August 2023.

1. On 23 August 2023, the AMWU corresponded with my chambers and Wood to outline the outstanding bargaining issues.  The wage increase sought by the AMWU on behalf of its members was 18% over three years, with a significant front-loaded increase at the commencement of the agreement. The offer that had earlier been put by Wood, and rejected by employees, was a 12% increase over three years, with increases at 6% on commencement, 4% on 1 June 2024 and 2% on 1 June 2025.

1. At the conference on 24 August 2023, Wood representatives rejected the offer of 18% over the life of the agreement, indicating that it could never be agreed.  Wood contracts to Ampol at the refinery and the significant pay increase will not be funded by Ampol, nor can Wood absorb the differential between what it receives from Ampol and what is required to be paid to employees.

1. On 22 August 2023, an application was made by the AMWU seeking an order to reduce the proposed reduction in pay for participating in  partial work bans, being the bans on holding permits.  The s.240 conference on 24 August 2023 also dealt with the s.472 application by the AMWU.

1. At the conclusion of the 24 August 2023 conference, I informed the parties of my availability to assist with bargaining on 30 and 31 August 2023.  

1. At a conference with the parties on 30 August 2023, bargaining was respectful and meaningful.  The AMWU officials, organisers, delegates and members genuinely sought to reach agreement with Wood and put forward what I consider to be a very sensible, appropriate and beneficial offer being:

·  A 6% increase from the date the agreement is voted up;

·  A 4% increase from 1 June 2024;

·  A 4% increase from 1 June 2025;

·  A sign-on bonus in an amount to reflect the 6% increase period not paid between 1 June 2023 and the date of the vote; and

·  Withdrawal of a weekend night shift claim in recognition of the increase to headline wage escalations.

1. The quantum of the offer put by the AMWU represents a 14% increase over the life of the agreement, up from Wood’s offer of 12%.

1. The Wood representatives required time to consider the increased offer.  A further conference was convened before me at 1:00pm on 31 August 2023.

1. The Wood representatives advised that the offer put by the AMWU was accepted, noting that the bonus payment would represent an end-of-bargaining payment in the amount of $1,400 for relevant employees.  I commended Wood on being able to meet the AMWU members’ bargaining position.  I am cognisant of the fact that the additional payment sought by the members and agreed to by Wood is not being funded by its client and is, uncomfortably, being absorbed by Wood’s profit margin, which is already slim.

1. The offer is to be put to relevant Wood employees within the next fortnight following the relevant access period commencing.  The employee bargaining representatives consider Wood’s agreement to move to the 14% wage request to be a very satisfactory outcome of the bargaining.

1. Having spent some time with the parties and on account of the industrial pain already experienced by all of the parties with the industrial action taken to-date, I recommend to the employees voting on the agreement to accept the offer to be put by Wood.  That is, in headlight terms:

·  A 6% increase from the date the agreement is voted up;

·  A 4% increase from 1 June 2024;

·  A 4% increase from 1 June 2025; and

·  An end-of-bargaining payment of $1,400.

1. The AMWU members who took industrial action have already received a short pay on 30 August 2023 due to the relevant deductions required on account of the industrial action taken when industrial action commenced. 

1. The AMWU members will again experience a short pay on 6 September 2023 on account of the most recent protected industrial action taken. 

1. The experience of receiving a significantly reduced payment will be acutely felt by the employees and relevant family members at a time when cost of living pressures are widespread.

1. I am not convinced that any further protected industrial action will achieve a better outcome for the employees to be covered by an agreement that will shortly be put to them for their consideration.  I anticipate that if members take further protected industrial action, Wood will not be in a position to increase its offer on account of the losses incurred to-date and the availability of other contractors to fulfil the work required by Ampol.  Simply put, the members are likely to experience further industrial pain and loss of wages for the period of protected industrial action, for no greater outcome.

1. My strongest recommendation is for the AMWU members to cease taking industrial action and to accept the agreement to be put to vote in the near future. 

COMMISSIONER

Printed by authority of the Commonwealth Government Printer

<PR765736>