1
Fair Work Act 2009
s.418 - Application for an order that industrial action by employees or employers stop etc.
Patrick Stevedores Holdings Pty Limited
v
Maritime Union of Australia, The
(C2013/4565)
VICE PRESIDENT WATSON SYDNEY, 4 JULY 2013
Application for an order that industrial action by employees stop - alleged productivity cap -
whether industrial action happening, threatened, impending or improbable or being
organised - Fair Work Act 2009 - ss. 418, 420.
Introduction
[1] This decision concerns an application pursuant to s.418 of the Fair Work Act 2009 (the
Act) for an order that industrial action by employees of Patrick Stevedores Holdings Pty
Limited (Patrick) stop. The employees concerned are employed by Patrick at its Port Botany
terminal, and are members of The Maritime Union of Australia (MUA). The order is sought
against the MUA, officials, delegates, employees and agents of the MUA and employees of
Patrick.
[2] The application was made by Patrick on 30 May 2013, and listed for urgent hearing on
31 May. An interim order1 was made pursuant to s.420 of the Act following that hearing, and
the matter was further listed for mention on 4 June. The parties agreed to a timetable for the
filing of submissions and evidence, and the matter was heard in full on 19 and 26 June.
[3] During the proceedings, Mr A Slevin, of counsel, appeared for the MUA. Mr Y Sharif,
of counsel, appeared for Patrick. Evidence was given for Patrick by Timi Cheng, Gary Webb,
Michael O’Leary and Gregory Rehn. Matthew Freestone, Paul Garrett and Paul Keating gave
evidence for the MUA.
Background
[4] Patrick operates container terminal stevedoring facilities at various terminals,
including Port Botany. Patrick employs stevedores at the Port Botany site, who are eligible to
be members of the MUA. Patrick alleges the MUA and its members are undertaking
unprotected industrial action in the form of a ‘productivity cap’, ‘go-slows’, absenteeism, and
stoppages of work.
[2013] FWC 4391 Note: An appeal pursuant to s.604 (C2013/5276) was
lodged against this decision - refer to Full Bench decision dated 11 October
2013 for result of appeal.
DECISION
AUSTR FairWork Commission
http://www.fwc.gov.au/decisionssigned/html/2013FWCFB7736.htm
[2013] FWC 4391
2
[5] There has been previous disputation between the parties about the use of productivity
caps as a form of unprotected industrial action. In early 2012, Patrick made an application
pursuant to s.418 in relation to an alleged productivity cap following consultation with the
MUA over redundancies following the closure of part of Bluescope’s operations at Port
Kembla. That matter was referred to me, and ultimately I issued an order2 on 14 March 2012
requiring the unprotected industrial action to cease.
[6] In the March 2012 matter, I concluded:
“I am satisfied on the evidence of Mr Wilson and Mr O'Leary that there is industrial
action happening in the form contended for by the applicant in this matter. I am also
satisfied that the nature of that industrial action is such and the apparent reasons for the
industrial action is such that the MUA is involved in that industrial action.”3
[7] Patrick alleges that the current action arises from the opposition of the MUA and its
members to the redevelopment of the Port Botany terminal, which involves the automation of
various activities and a high likelihood of future redundancies. As part of the redevelopment
program, Patrick announced in March 2013 that it proposed to automate the labour allocation
process. The revised allocation process was discussed during a conference before Deputy
President Sams on 17 April 2013. It was agreed that Patrick would provide a presentation on
the operation of the automated allocation system pursuant to an interim arrangement
recommended by DP Sams, to an elected sub-committee of the Employee Representative
Committee (ERC). The full ERC would then consider the matter on 15 May 2013. On 7 May
2013 the day shift employees passed a resolution that they would not use the automated
allocation system until further notice. On the same day, the allocation system was
disconnected without authorisation. The system was duly considered by the ERC on 15 May
2013. Patrick alleges that significant industrial action has occurred since that date.
[8] The MUA denies that it or its members are engaging in any industrial action.
Legislation
[9] The application by Patrick is made pursuant to s.418 of the Act, which relevantly
provides:
“418 FWC must order that industrial action by employees or employers stop
etc.
(1) If it appears to the FWC that industrial action by one or more employees or
employers that is not, or would not be, protected industrial action:
(a) is happening; or
(b) is threatened, impending or probable; or
(c) is being organised;
the FWC must make an order that the industrial action stop, not occur or not be
organised (as the case may be) for a period (the stop period) specified in the order.
[2013] FWC 4391
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Note: For interim orders, see section 420.
(2) The FWC may make the order:
(a) on its own initiative; or
(b) on application by either of the following:
(i) a person who is affected (whether directly or indirectly), or who
is likely to be affected (whether directly or indirectly), by the industrial
action;
(ii) an organisation of which a person referred to in subparagraph
(i) is a member.
(3) In making the order, the FWC does not have to specify the particular industrial
action.
(4) If the FWC is required to make an order under subsection (1) in relation to
industrial action and a protected action ballot authorised the industrial action:
(a) some or all of which has not been taken before the beginning of the
stop period specified in the order; or
(b) which has not ended before the beginning of that stop period; or
(c) beyond that stop period;
the FWC may state in the order whether or not the industrial action may be engaged in
after the end of that stop period without another protected action ballot.”
[10] I turn now to consider the elements of s.418.
Is industrial action happening, threatened, pending or probable?
[11] Patrick led evidence of a history of productivity restrictions being used by the MUA
and its members at Port Botany to exert pressure on Patrick over industrial demands. Mr Mick
O’Leary, the General Manager, Industrial Relations for Patrick and a former MUA Deputy
National Secretary gave evidence of the imposition and lifting of productivity caps and go-
slows over recent years. His evidence was that a productivity cap was an acknowledged form
of industrial action and that, in his experience, industrial action does not occur at the Port
Botany terminal without the knowledge and involvement of the MUA.
[12] Patrick led evidence of what it alleged to be four instances of industrial action, some
of which occurred at a particular time and others that occurred over a lengthier period. The
instances were:
The ‘unvolunteering’ for overtime on 10 May 2013;
Decreases in productivity since 15 May 2013;
Unprecedented levels of absenteeism and unplanned absences between 14 and 16
June; and
[2013] FWC 4391
4
A stoppage of work on the afternoon shift on 5 June 2013.
[13] On Friday 10 May 2013 approximately 10 employees, who had previously volunteered
for overtime, removed their nomination for work that weekend. Patrick suffered a shortage of
labour over the weekend as a result. Mr O’Leary gave evidence that this was highly unusual.
Mr Freestone gave evidence that he was one of the 10 employees and removed his nomination
for private reasons. As there is no ongoing action of that nature I do not consider that the
action is happening. However, I consider that in the circumstances, it is likely to be in the
nature of industrial action, being a partial ban or limitation on the performance, acceptance or
offering for work.
[14] Patricks relied on productivity data to support its claim that a productivity cap of 260
lifts per shift has been in place since mid May 2013. The data was initially led in the hearing
of 31 May and updated during the course of subsequent proceedings. The evidence establishes
that from 1 January 2013 to 16 May 2013 crane gangs exceeded 260 lifts per shift 22.42% of
the time. From 16 May 2013 to 29 May 2013 crane gangs exceeded 260 lifts per shift 9.73%
of the time. Between 16 May 2013 and 16 June 2013 crane gangs exceeded 260 lifts per shift
13.4% of the time.
[15] Mr Cheng gave evidence of a further breakdown of the performance after 7 June. He
said that it had become apparent that one crew per shift performed very well, while the
performance of other gangs was much lower. There are usually four crane crews per shift.
From 7 to 16 June 24.73% of crews exceeded 260 lifts per shift - higher than the performance
level from 1 January to 16 May. When the highest performing crew per shift was taken out of
the calculations only 8.45% of crews exceeded 260 lifts.
[16] Mr Cheng also gave evidence that the average number of lifts per shift from 1 January
to 16 May 2013 was 213.42. It was 220 between 1 and 16 May. From 16 May to 16 June the
average lifts per shift was 197.7. The average between 7 June and 16 June after taking out the
best performing crane gang on each shift was 189.7 lifts per shift.
[17] Counsel for the MUA cross-examined Mr Cheng and contended that the data does not
establish the existence of a productivity cap. The existence of a cap was expressly denied by
MUA witnesses. Mr Freestone said that the employees were frustrated and unhappy about the
way the company had been treating them and that he and other members of the site committee
had been endeavouring to keep the member’s frustrations under control. He said that new
safety procedures were having an effect on productivity.
[18] Counsel for Patrick submits that a clear inference from all the evidence is that
industrial action in the form of productivity restrictions is happening. I accept that such an
inference should be drawn from the evidence. It is clear that the dispute over automation has
been festering for some time. It has now reached the stage where some implementation of
automation is occurring. The MUA has consistently been critical of the automation proposals.
Its members have passed resolutions opposing the implementation of the changes. The MUA
concedes that employees are frustrated with the fact that implementation of automation will
not be stopped.
[19] The Port Botany site is characterised by a history of industrial action, including go-
slows and productivity caps that are intended to damage the performance of the company
while not significantly prejudicing the earnings of employees. The workforce is estimated to
[2013] FWC 4391
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be 100% unionized. The work crews and team leaders are members of the MUA. There is
little opportunity for constant supervision of work practices by non-unionised supervisory
employees. The workplace culture involves a high level of employee solidarity and a high
level of employee antipathy for management.
[20] The MUA and its members are obviously aware of their inability to engage in lawful
industrial action. However they have the clear motivation to engage in responsive action and
to attempt to avoid culpability by disguising their conduct and responsibility. There is no
logical reason for the drop in productivity other than it being the result of actions by
employees to deliberately limit productivity and avoid detection of their conduct. In
particular, the alleged increased safety requirements do not provide a logical explanation.
[21] The normal performance level of one crew per shift since the nature of Patrick’s
evidentiary case was disclosed is particularly revealing. It suggests that weather and other
uncontrollable factors were not present and safety requirements which all crews were required
to apply did not inhibit productivity. I also found the evidence of MUA witnesses to be
unpersuasive. Mr Keating in particular was inappropriately combative. I found his evidence
unreliable. The evidence suggests to me that productivity at Port Botany has been inhibited by
a covert campaign to damage the company. The isolated performing crew per shift has all the
appearances of a particularly cynical device to avoid detection of the productivity limitations.
In all the circumstances I find that industrial action in the form of productivity limitations is
happening and, in the absence of any change to the automation program and the MUA’s
opposition to it, is likely to continue.
[22] Between 10pm on 14 June 2013 and 10pm on 16 June 2013 there were 66 unplanned
absences from the approximately 600 employees rostered to work in that period. This level of
absenteeism meant that there was a shortage of labour for that weekend. Mr O’Leary gave
evidence that the average number of unplanned absences per 24 hours is between 8 and 9, a
much smaller percentage of the workforce. Mr O’Leary said that he has not known of this
level of absenteeism outside of an industrial campaign. This level of absenteeism occurred
after Mr McAleer and Mr Keating of the MUA attended the site on 13 June to provide a
report to employees.
[23] I consider that the level of absenteeism is related to the employee’s dissatisfaction
with the introduction of automation. Mr Keating’s vehement denial of any possibility of
industrial action in the face of the facts undermines his credibility. I accept that he and the
other MUA officials have been very careful to avoid any admission of, or overt examples of,
industrial action. However there is a strong inference that this covert limitation on work is
engaged in with the knowledge of fellow employees and the tacit acceptance of the MUA
officials and delegates.
[24] On 5 June 2013 a white powder had blown off a container in a ship being unloaded.
The area was cordoned off and a specialist contractor was called to clean the area. Three
employees who had been in contact with the substance were taken to hospital as a
precautionary measure. A risk assessment was conducted by an MUA appointed safety
facilitator. After the risk assessment was completed, the employees confirmed that they were
satisfied with the controls that had been put into place and returned to work as normal. When
advised of the situation, Mr Paul Garrett, the Assistant Branch Secretary of the Sydney
Branch of the MUA directed the afternoon shift to cease work, prior to attending the site. He
[2013] FWC 4391
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then attended the site, held further discussions and subsequently approved the resumption of
work.
[25] Patrick contends that Mr Garrett’s conduct and the employee’s compliance with his
direction amounts to industrial action as there was no imminent risk to health and safety after
the risk assessment was conducted. In my view this contention is correct. The direction by Mr
Garrett without any direct involvement in an assessment of the safety risk and in the face of
the risk assessment clearing the site for work to resume was reckless and inappropriate. I
found Mr Garrett to be evasive and aggressive in his evidence which led me to believe that his
action may have been deliberately designed to make use of the situation to cause damage to
Patrick.
[26] In consideration of all of the evidence in this matter, I find that covert industrial action
has occurred and continues to occur at the Port Botany terminal and it is probable that it will
continue unless effective orders are made and complied with.
Is the industrial action being organised?
[27] Patrick contends that it is inherently unlikely that the industrial action is occurring
without coordination and organisation amongst employees and the MUA. It submits that an
inference should be drawn from the facts and circumstances that the MUA and its
representatives, have organised, or are organising, or are directly or indirectly involved in, or
concerned, with the industrial action. It relies on the high level of unionisation, its extensive
delegate structure, the nature of the current dispute over automation, the representation of
employees by the MUA in the dispute, the expression of intention by employees, and the
regular contact between MUA officials and its delegates and members.
[28] Mr Keating and Mr Freestone expressly deny that they or the MUA have organised the
action. They both either accepted or did not respond to the suggestion that if there was any
industrial action they would be aware of it. They also deny that any industrial action has
occurred.
[29] In my view the nature of the industrial action that I have found has occurred and
continues to occur could only happen if it was coordinated and planned. Because it is covert,
it can be expected that it will be associated with attempts to avoid the detection of anyone
associated with it. Mr Keating and Mr Freestone deny its existence and deny their
involvement in industrial action. It is clear that they have both refrained from being involved
in any more overt industrial action and could well have encouraged employees not to engage
in overt industrial action. However their refusal to accept that any industrial action is
occurring, or show any sympathy for the productivity performance, colours their denials. The
shifting nature of the industrial action and the apparent contrived device since 7 June of one
well performing crew per shift to produce performance statistics at odds with Patrick’s initial
evidence strongly supports an inference of MUA involvement. I find on the evidence that the
MUA through its delegates and/or its officials is organising and is involved in the industrial
action that is taking place.
Conclusions
[30] As I have found that industrial action is happening and is likely to continue I am
required by the terms of the Act to make an order that the action stop and not occur. Together
[2013] FWC 4391
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with the publication of this decision I make an order4 substantially in the terms sought in the
amended application. I will provide for the order to remain in place for a period of six months.
VICE PRESIDENT WATSON
Appearances:
Mr Y Sharif, of counsel, for Patrick Stevedores Holdings Pty Limited
Mr A Slevin, of counsel for The Maritime Union of Australia
Hearing details:
2013.
Melbourne.
May
31
Sydney
June
4, 19, 26.
Printed by authority of the Commonwealth Government Printer
Price code C, PR538566
1 PR537455
2 PR521163
3 Transcript 14 March 2012, PN 851
4 PR538567
COMMISSION AUSTRALIA THE SEAL OF FA
