1
Fair Work Act 2009
s.604 - Appeal of decisions
The Maritime Union of Australia
v
Patrick Stevedores Holdings Pty Ltd
(C2016/2366)
VICE PRESIDENT HATCHER
VICE PRESIDENT CATANZARITI
DEPUTY PRESIDENT BULL SYDNEY, 8 FEBRUARY 2016
Appeal against decision ([2016] FWC 464) and order (PR576370) of Vice President Watson
at Melbourne on 22 January 2016 in matter number B2016/212.
Introduction and background
[1] On 30 June 2015 the Patrick Terminals Enterprise Agreement 2012, which covers the
container terminals operated by Patrick Stevedores Holdings Pty Ltd (Patrick) at the ports of
Brisbane, Port Botany, Melbourne and Fremantle, reached its nominal expiry date. In
anticipation of this, negotiations for a new enterprise agreement began in about March 2015.
[2] There was a significant number of meetings between Patrick and the bargaining
representative of Patrick’s employees, the Maritime Union of Australia (MUA), in an
endeavour to reach a new agreement. The negotiations were divided into two parts: Part A
dealt with issues common to all four terminals, and Part B were negotiations about issues
specific to each port/terminal. From 9 April through to 11 December 2015, there were 29 Part
A meetings. The Part B meetings for each of the four individual terminals were as follows:
Brisbane: 3 meetings from 15 May through to 22 September 2015.
Port Botany: 9 meetings from 21 May through to 8 December 2015.
Melbourne: 4 meetings from 10 March 2015 through to 6 November 2015.
Fremantle: 7 meetings from 22 July through to 1 December 2015.
[3] The state of play in relation to the Part B negotiations after these meetings was that in-
principle agreement had been reached concerning Brisbane and Melbourne, only one issue
remained unresolved in Fremantle, but major issues remained in Port Botany.
[2016] FWCFB 711
DECISION
E AUSTRALIA FairWork Commission
[2016] FWCFB 711
2
[4] On 18 September 2015 Patrick, with the consent of the MUA, made an application to a
member of this Commission, Deputy President Booth, for her assistance to facilitate the
conduct of the bargaining. The application stated the following:
“We are writing to seek your involvement in the negotiations currently occurring
between Patrick Stevedores Holdings Pty Limited (Patrick), the Maritime Union of
Australia (MUA) and Patrick Employees concerning a replacement to the Patrick
Terminals Enterprise Agreement 2012 (EA) which reached its nominal expiry date on
30 June 2015.
Negotiations have been ongoing since approximately March this year. The parties
have worked cooperatively and constructively to endeavour to reach agreement that
provides sustainable benefits to employees.
At this stage, whilst good progress has been made and negotiations have continued to
proceed in good faith, the parties have identified a number of issues which we foresee
will be challenging to resolve. Collectively we believe that engaging with you to assist
negotiations gives the parties the best opportunity to reach an outcome quickly, and in
a manner that is supportive of the relationship going forward.
Given your involvement to date with the Patrick Bulk Port Services business in
negotiating Patrick Bulk and General Enterprise Agreements, we believe that you are
well placed to assist us in these negotiations. At this stage, the parties have agreed to
further meetings in the week commencing 27 September 2015. Subject to you being
able to assist us with these negotiations and your availability, we would ideally seek to
have your involvement in some of the negotiations in that week.
We thank you for your consideration of our request and look forward to your
response. If you need any further information I can be contacted on [telephone
number deleted]. The MUA officials who have been involved in negotiations to date
have been copied on this correspondence.”
[5] In matter NA2015/6, Deputy President Booth provided the requested assistance in the
conduct of the negotiations. The Deputy President facilitated the last 12 Part A meetings from
30 September 2015 to 11 December 2015 and the Part B meetings at Port Botany on 28
September 2015 and 18 November 2015.
[6] On 30 November 2015 the MUA applied for an order for the holding of a ballot of
employees to authorise the taking of protected industrial action. On 1 December 2015, subject
only to one minor drafting alteration, Patrick informed the Commission that it did not oppose
the making of the order sought by the MUA. On 2 December 2015 the protected action ballot
order sought was made by Deputy President Booth in matter B2015/1665.1 The result of the
ballot conducted pursuant to the order, which was declared by the Australian Electoral
Commission on 23 December 2015, was that employees voted to authorise the taking of
various forms of industrial action including stoppages of work and bans. The first notice of
industrial action was given on 28 December 2015, and the first instance of industrial action
commenced on 6 January 2016.
1 PR574644
[2016] FWCFB 711
3
[7] The industrial action which followed from then on consisted of, in summary, an
indefinite and continuing ban on overtime and shift extensions at Port Botany commencing on
6 January 2016 and at Fremantle from 19 January 2016, and stoppages of work of varying
durations at Brisbane, Port Botany, Melbourne and Fremantle on 18 and 19 January 2016.
The MUA also gave notice that there would be additional stoppages of work at Brisbane and
Melbourne on 25 January 2016 and at Port Botany on 26 and 27 January 2016.
[8] On 19 January 2016 Patrick applied to the Commission for an order that protected
industrial action being engaged in by its employees at the four container terminals for whom
the MUA was the bargaining representative be suspended for a period of 60 days
(Application). The Application was made pursuant to s.425 of the Fair Work Act 2009 (FW
Act), which provides:
425 FWC must suspend protected industrial action—cooling off
(1) The FWC must make an order suspending protected industrial action for a
proposed enterprise agreement that is being engaged in if the FWC is satisfied that the
suspension is appropriate taking into account the following matters:
(a) whether the suspension would be beneficial to the bargaining
representatives for the agreement because it would assist in resolving the
matters at issue;
(b) the duration of the protected industrial action;
(c) whether the suspension would be contrary to the public interest or
inconsistent with the objects of this Act;
(d) any other matters that the FWC considers relevant.
(2) The FWC may make the order only on application by:
(a) a bargaining representative for the agreement; or
(b) a person prescribed by the regulations.
[9] The Application was opposed by the MUA, and accordingly a hearing of the
application occurred on 21 January 2016 before Vice President Watson. On 22 January 2016
he issued a decision2 (Decision) in the following terms:
“[1] This decision concerns an application by Patrick Stevedores Holdings Pty Ltd
(Patrick) for an order under s.425 of the Fair Work Act 2009 (the Act) that protected
industrial action that is being engaged in by employees of Patrick who are members of
The Maritime Union of Australia (MUA) be suspended.
[2] I am satisfied that suspension of the protected industrial action is appropriate
taking into account the matters specified in s.425 of the Act. I determine that the
suspension will be for a period of 35 days from the date of this decision.
2 [2016] FWC 464
[2016] FWCFB 711
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[3] Full reasons for my decision in this matter will be issued in due course.”
[10] Accompanying the Decision, the following order3 (Order) was issued on the same day:
“A. Further to the decision issued in [2016] FWC 464, and pursuant to s.425 of
the Fair Work Act 2009, the Fair Work Commission orders as follows:
1. Protected industrial action being engaged in by employees of Patrick
Stevedores Holdings Pty Ltd (Patrick):
who perform work at the Patrick container terminals at the Ports of
Fremantle, Port Botany, Brisbane and Melbourne,
and for whom the Maritime Union of Australia is a bargaining
representative for the proposed Patrick Terminals Enterprise
Agreement 2015,
is suspended for a period of 35 days from the date of this order.
B. This order will take effect from 22 January 2016.”
[11] On 25 January 2016 the MUA lodged a notice of appeal in which it sought permission
to appeal and appealed the Decision and Order.
[12] On 29 January 2016 the reasons for the Decision4 (Reasons) were issued by Vice
President Watson.
Reasons for Decision
[13] After outlining the history of bargaining and protected industrial action, the Reasons
dealt with an argument advanced by the MUA that, on the proper construction of s.425,
regard could only be had to protected industrial action which was being engaged in at the time
that an application under the section was being considered, that it was only that industrial
action which was capable of being subject to a suspension order, and accordingly that in
considering the appropriateness of suspension, the consideration was confined to the
appropriateness of suspension of the particular action being engaged in at the time. This
argument was opposed by Patrick and rejected by Vice President Watson in the Reasons. It
was concluded that engagement in any protected industrial action provided the “jurisdictional
trigger” for the making of an order that suspended all protected industrial action, and that the
consideration of the appropriateness of suspension needed to have regard to protected
industrial action that was both happening and impending.5
[14] The Reasons then dealt with the matters required to be taken into account under
s.425(1). In relation to whether the suspension would be beneficial to the bargaining
representatives because it would assist in resolving the matters at issue (s.425(1)(a)), the
3 PR576370
4 [2016] FWC 510
5 Reasons at [15]-[20]
[2016] FWCFB 711
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Reasons focused upon an exchange of correspondence between Patrick and the MUA which
took place on 14 January 2016. This correspondence was set out in full in the Reasons. The
first was a letter from Mr Anthony Jones, the General Manager of Patrick’s NSW/Queensland
operations, to Mr Will Tracey, the Deputy National Secretary of the MUA. The letter, as
reproduced in the Reasons, read as follows:
“I am writing in relation to the ongoing negotiations for the proposed enterprise
agreement to replace the Patrick Terminals Enterprise Agreement 2012.
As you know, the parties have been engaged in extensive discussions facilitated by
Deputy President Anna Booth of the Fair Work Commission. Many claims have been
raised and discussed. The company has found the involvement of Deputy President
Booth to be of assistance in the process, and we believe that the discussions in 2015
were constructive and saw the parties moving towards reaching agreement. The
process is ongoing, and there are a number of issues which remain unresolved. These
include claims dealing with matters that include:
Coverage.
Remuneration (including wages, superannuation and income protection).
Redundancy.
Transfer of business.
Contractors.
Dispute resolution.
These matters, along with others, are the subject of ongoing discussion and negotiation
between the parties, with the assistance of Deputy President Booth. Some matters are
yet to even be discussed in any meaningful way by the parties, such as the most recent
position put forward by the union for rostering at Port Botany.
The company believes that there is significant further negotiation which is required,
and that there is scope for compromise by both sides on a number of matters. The
company is prepared to continue to seek agreement with the assistance of Deputy
President Booth, and is open to more formal conciliation and, if necessary, arbitration
to resolve all matters.
Against this background, the company was disappointed that the union decided to seek
a protected action ballot order while constructive discussions were ongoing, and
disappointed again to receive notification of a range of stoppages and bans. Indeed,
these are to take place at times when the negotiating teams are due to meet on 20th,
21st and 22nd January 2016. This does little to assist the parties to reach an agreement.
The company views the proposed industrial action as entirely premature in the
circumstances, and believes that the parties should instead focus on the negotiations
and seeking to reach an outcome in the near term. For this reason, we invite the union
to withdraw all notices of protected industrial action and undertake not to provide
[2016] FWCFB 711
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further notices while negotiations are continuing. The company believes that this
would be beneficial to the parties because it would assist in resolving the matters in
dispute.
As you know, the parties some time ago agreed to meet on 20th, 21st and 22nd January
2016. Deputy President Booth was not scheduled to attend these meetings, but only
because she is unavailable for them. Given the recent escalation of matters, and the
constructive nature of the earlier discussions chaired by her, the company believes that
the meetings next week should be rescheduled to the earliest possible occasion on
which Deputy President Booth is available. We will seek her available dates and be in
touch to confirm arrangements.
In the meantime, please advise whether the union withdraws all current notices of
protected industrial action by 4pm on Thursday 14th January 2016.”
[15] Mr Tracey’s reply email, as reproduced in the Reasons, was as follows:
“I’ll keep the reply as short as I possibly can.
I don't have anything to say about your inaccurate summary of the negotiations to date
suffice to say that it isn't reflected in the ongoing minutes and you haven't been at the
discussions.
Patrick and your views on the PABO and notified action are noted. Neither should
come as a surprise to Patrick because we informed the company at our last meeting
prior to Christmas, in front of DP Booth, that we were going to do this unless we saw
some meaningful movement from Patrick. Your correspondence prior to Christmas
and actions prior and since have caused this current set of circumstances to occur. We
will not be withdrawing the action and if Patrick refuses to meet next week we will
escalate the action until you do meet. We have 3 days to meet next week to try and get
a resolution to the agreement or at the very least a decent view of it- we are aware of
the issues and they can be resolved without the presence of DP Booth although like
you we acknowledge the very positive influence she had on the negotiations so far.
While we remain committed to the ongoing process before DP Booth, and understand
the benefits to date, we will not consent under any circumstances to arbitration of the
agreement.
The reality is we have seen very little movement from Patrick on some of our key
issues, many of which you have clearly outlined, and we have been going at this for
close to 12 months. Please confirm you will meet next week because we need to be
absolutely clear that a refusal to meet will result in an escalation of the action. At the
very least we will be able to close the gap on some matters and clarify for our next
meeting with DP Booth what assistance we need and on what issues. In respect of your
recent site correspondence I have cancelled my last week of leave to attend next
week's meetings. We have already paid for airfares and accommodation for those
attending.
One other point we wish to express is our anger and disgust at the opportunistic email
correspondence your management in Fremantle has sent to Kim MacDonald from the
[2016] FWCFB 711
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West Australian seeking to link our action to the tragic and unfortunate situation of the
South West bushfires. To misrepresent the impact of the action in this manner hoping
to chase a headline is reprehensible behaviour and will get an appropriate response at
an appropriate time - your Fremantle management has seriously miscalculated this
tactic and the views of our membership in this Port. Our membership and Union have
been contributing financially to the Union fund set up for assistance to those affected
by these fires with many helping to actually fight the fires. This disgraceful behaviour
of your Fremantle management is condemned by this Union and its members in the
strongest possible terms.”
[16] The Reasons then stated the following conclusions about this exchange:
“[25] It appears from this correspondence that cancellation of meetings in preference to
facilitated discussions by Deputy President Booth is a major factor in the escalation of
industrial action. The industrial action reflects a deterioration in the negotiation
process at a time when the assistance of Deputy President Booth was not available.
Deputy President Booth had advised the parties that the week of 1 February 2016 is
available for further facilitation of the negotiations. Whatever else may be said about
the communications between the parties on 14 January, at least the parties appear to be
agreed on the need for discussions aimed at bridging the gap between them.”
[17] Reference was then made to the evidence of Mr Jones, which was characterised as
demonstrating that the occurrence of industrial action, including the bans, made it “difficult
for Patrick managers to make the time available to attend bargaining meetings before, during
and after industrial action” because it required them to go into “firefighting mode” which did
not enable “other time consuming and difficult processes to be given necessary attention”.6
The following critical conclusions were then stated (emphasis added):
“[28] Mr Jones gave evidence that the MUA provided Patrick with a “settlement
document” on 6 January 2016 and several notices of industrial action on 8 January
2016. Mr Jones states that the document requires discussion between the parties. That
discussion has not occurred. The MUA states that this is because of the cancellation of
meetings planned for the week of 18 January. Patrick states that the protected
industrial action has hindered the process. I make no finding as to the fault of any
party. However it is clear that the elevation of hostilities between the parties has
precluded the processes of discussion and negotiation. The negotiations have
advanced satisfactorily at some locations. At the Sydney terminal and at the Part A
level there appears to be a need for considerable additional effort of the parties. On the
evidence before me compromise on some of the issues is likely. The involvement of
the Commission is also likely to be of assistance.”
[18] Reference was then made to the “disruption of services to third parties” as a “relevant
contextual consideration”7, and the conclusion was stated that “I do not consider that
suspension undermines the claims or the bargaining position of the MUA or deprives it of the
ability to support its claims with industrial action in the future.”8 The following conclusion
was then stated in relation to s.425(1)(a):
6 Reasons at [27]
7 Reasons at [29]
8 Reasons at [30]
[2016] FWCFB 711
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“[31] In all of the circumstances I am of the view that suspension of the protected
industrial action would assist the bargaining representatives resolve the matters at
issue. Provided the suspension is sufficient to enable proper discussion and
consideration of revised positions and for the parties to access the assistance of Deputy
President Booth I am of the view that suspension will assist in the relevant way.
Because of the above considerations however, it would not be appropriate to suspend
protected industrial action for a lengthy period. I have reached this conclusion on the
basis of the current and pending industrial action. However I would reach the same
conclusion if considering only the current industrial action.”
[19] In relation to the duration of the protected industrial action (s.425(1)(b)), the Reasons
summarised the protected industrial action which had occurred and then stated (emphasis
added):
“[32] … Despite the disruptive nature of this industrial action there does not appear to
have been any concessions by Patrick in response to the industrial action. Indeed the
cancellation of meetings appears to represent some hardening of Patrick’s position. If
only current industrial action is considered, the pending escalation would need to be
disregarded.”
[20] As to whether suspension would be contrary to the public interest or the objects of the
FW Act (s.425(1)(c)), the conclusion stated was that suspension would be consistent with the
public interest and the object of the FW Act.9 The Reasons were silent as to whether any other
matter was considered relevant for the purpose of s.425(1)(d). The following overall
conclusions were then stated:
“[35] Taking into account all of the circumstances and in particular the factors outlined
above I decided to suspend protected industrial action because I was satisfied that
suspension is appropriate. In coming to this assessment I considered that the
suspension would be beneficial to the bargaining representatives because it would
assist in resolving matters in dispute. I have considered the nature and duration of the
industrial action. I am not satisfied that suspension is contrary to the public interest or
the Object of the Act. Indeed suspension is consistent with the Object and the public
interest. I have considered all other relevant circumstances raised by the parties in the
evidence and submissions before me.
[36] The matters I am required to take into account point strongly towards the
appropriateness of suspension. Even if the pending 24 hour stoppages were removed
from consideration I would reach the same conclusion. I am therefore of the view that
suspension is appropriate. As I am satisfied that suspension is appropriate I am
required by the terms of s.425 to make an order suspending protected action.
[37] I consider that suspension for 35 days will enable detailed consideration before
Deputy President Booth over the ensuing weeks and not deprive the parties of their
options for the future. An order giving effect to my decision was issued on 22 January
in conjunction with my decision in the matter.”
9 Reasons at [34]
[2016] FWCFB 711
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Submissions
[21] The MUA submitted that the Order was invalid because it did not specify the
particular protected industrial action which was suspended. One of the jurisdictional
prerequisites for the making of a suspension order under s.425(1) was that protected industrial
action was “being engaged in”, and it was only that protected industrial action which was
found to be “being engaged in” which could be suspended by an order. The evidence was, the
MUA submitted, that the only protected industrial action actually being engaged in at the time
of the hearing and the Decision were the bans on overtime and shift extensions at Port Botany
and Fremantle, and if there was satisfaction that suspension was appropriate, the order that
was made should have been confined in its terms to suspension of those bans only. Because
the Order suspended protected industrial action generally, it went beyond the power conferred
by s.425(1).
[22] The MUA also submitted that there was error in the conclusion that the suspension of
protected industrial action was appropriate. It particularised its contention of error in this
respect as follows:
(1) The finding that cancellation of meetings in preference to facilitated
discussions by Deputy President Booth was a major factor in the escalation of
the industrial action (paragraph [25] first sentence) mistook the facts.
(2) The Reasons ignored the relevant consideration that Patrick had suggested that
the meetings be rescheduled as a result of the escalation of the industrial action.
(3) The Reasons ignored the relevant consideration that Patrick, with knowledge
that planned industrial action was not being withdrawn, had proposed on 15
January 2016 a high level meeting presided over by Deputy President Booth in
substitution for the previously scheduled meetings.
(4) The Reasons ignored the relevant consideration that the protected industrial
action had resulted in the substitution for the previously scheduled meetings of
a high level meeting presided over by Deputy President Booth.
(5) The Reasons disclosed error in relying on the conclusion of Mr Jones that it
was difficult for Patrick managers to make the time available to attend
bargaining meetings (paragraph [27] fifth sentence), which was not open on the
evidence.
(6) The conclusion of Mr Jones that it was difficult for Patrick managers to make
the time available to attend bargaining meetings (paragraph [27] fifth sentence)
was an irrelevant consideration.
(7) The Reasons ignored the relevant consideration that no Patrick managers were
unable to make the time available to attend bargaining meetings.
(8) The finding that the MUA stated that the discussion of the “settlement
document” had not occurred because of cancellation of meetings (paragraph
[28] fourth sentence) mistook the facts.
[2016] FWCFB 711
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(9) The findings linking the “settlement document” with the cancellation of
meetings (at paragraph [28]) mistook the facts.
(10) The finding that the elevation of hostilities between the parties had precluded
the processes of discussion and negotiations (paragraph [28] seventh sentence)
mistook the facts and was not open on the evidence.
(11) The finding that there appears to be a need for considerable additional effort of
the parties (paragraph [28] ninth sentence) was an irrelevant consideration in
that it could take place while protected action was permitted.
(12) The finding that compromise on some of the issues was likely (paragraph [28]
tenth sentence) was an irrelevant consideration in that it could take place while
protected action was permitted.
(13) The finding that the involvement of the Commission was likely to be of
assistance (paragraph [28] eleventh sentence) was an irrelevant consideration
in that it could take place while protected action was permitted.
(14) The Reasons failed to take into account the relevant consideration that Patrick
had conceded that it would continue talking to the appellant even if protected
industrial action was occurring.
(15) If meetings were cancelled, the Reasons erred in taking any account of such
cancellation which was a choice made by the respondent.
(16) The Reasons disclosed error in taking into account at all (at paragraph [29]) the
nature of the industry, the importance of the respondent to an important aspect
of the Australian economy and the disruption of services to third parties.
(17) The Reasons fundamentally misconceived the effect of the suspension on the
MUA’s bargaining position in finding (at paragraph [30]) that it would not be
undermined by the suspension.
(18) The ultimate conclusion that suspension of the protected industrial action
would assist the bargaining representatives to resolve the matters at issue
(paragraph [31] second sentence) was erroneous in that it was based on the
erroneous analysis of the circumstances as set out in particulars (1) to (17)
above.
(19) The ultimate finding that suspension had to be sufficient to enable proper
discussion and consideration of revised positions and for the parties to access
the assistance of Deputy President Booth (paragraph [31] second sentence)
referred to irrelevant considerations in that it could take place while protected
action was permitted.
(20) The Reasons disclosed error in the finding that the objective of cooperative and
productive workplace relations suggests an emphasis on negotiation and
exhaustive attempts to reach agreement (paragraph [34] first sentence).
[2016] FWCFB 711
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(21) An emphasis on negotiation and exhaustive attempts to reach agreement
(paragraph [34] first sentence) was an irrelevant consideration in that it could
take place while protected action was permitted.
(22) The Reasons disclosed error in considering and finding that suspension was
positively consistent with the public interest and the object of the FW Act
(paragraph [34] fifth sentence).
[23] The MUA also submitted that the facts of the case demonstrated that the Decision and
the making of the Order were unreasonable and/or plainly unjust.
[24] Patrick submitted that, on the proper interpretation of s.425(1), the power conferred
was to suspend the protection or immunity from suit afforded by s.415 in relation to all
industrial action. An order under s.425 did not and could not operate to suspend industrial
action, but it did have the consequence that industrial action that occurred during the period of
suspension would be rendered non-protected and therefore subject to ss.418, 420 and 422 of
the FW Act as well as any other action under State or Territory law. The interpretation
advanced by the MUA, Patrick submitted, was a narrow one which would defeat the cooling
off purpose of s.425. It was not in dispute that there was protected industrial action being
engaged in and accordingly, once there was satisfaction that suspension would be appropriate,
the order that was required to be made was that all protected industrial action was suspended.
The Order was consistent with this requirement and was valid.
[25] In respect of the question of the appropriateness of suspension, Patrick emphasised
that the decision-maker was required to exercise a broad discretionary judgment involving a
considerable degree of latitude as to the decision to be made. In relation to the specific
instances of error identified by the MUA, Patrick submitted:
The finding that the meetings set for 20, 21 and 22 January 2016 had been
cancelled was reasonably open on the evidence, having regard to the
communications between the parties on 14 and 15 January 2016 and the fact that
the meetings did not proceed.
The additional notices of industrial action issued on 15 January 2016 by the MUA
were inferentially related to the MUA’s opposition to the rescheduling of the
meetings proposed by Patrick on the preceding day.
The meeting on 22 January 2016 was not a meeting in accordance with the
processes of negotiation and discussion which had been agreed and followed the
escalation of industrial action, and the absence of any express mention of this
meeting in the Reasons did not detract from the conclusion that suspension would
assist the parties.
The clear evidence of the difficulties associated with bargaining while industrial
action was taking place was relevant to whether suspension was beneficial to the
parties, and there was no requirement for managers to be “unable” to attend
bargaining meetings.
The finding concerning the preclusion of the processes of discussion and
negotiation in paragraph [28] of the Reasons was not to be read as relating to
[2016] FWCFB 711
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discussions about the “settlement document” referred to earlier in the paragraph
but rather to the processes established and adopted prior to 14 January 2016.
The purpose of s.425 was the cessation of all protected industrial action by the
parties regardless of their respective bargaining positions.
It was not irrelevant that suspension would assist the bargaining representatives to
resolve the matters at issue or that a sufficient period of suspension would enable
the proper discussion and consideration of revised positions and access to the
assistance of Deputy President Booth.
The issues of the nature of the industry, the importance of Patrick to the
Australian economy and the disruption of services to third parties were only taken
into account contextually to conclude that the resolution of the issues would be of
benefit to the parties.
The statement in paragraph [34] of the Reasons concerning the emphasis to be
placed on negotiations and exhaustive attempts to reach agreement was merely
introductory to the rest of the paragraph, unremarkable and not in error.
The conclusion that the suspension of protected industrial action was not contrary
to the object of the FW Act or the public interest was not challenged by the MUA,
and the additional observation that suspension was positively in the public interest
was a matter for the Commission and available as a relevant factor under
s.425(1)(d).
The finding that a short period of suspension was appropriate in the circumstances
and that it would be of benefit to the parties not to have protected industrial action
ongoing whilst engaged in high-level discussions was clearly available on the
evidence.
Insofar as the MUA alleged that relevant matters were not taken into account, the
MUA needed to demonstrate that Vice President Watson was duty bound to take
those matters into account. There was no duty to take the matters into account in
the exercise of the broad discretionary judgments available under s.425(1).
Alternatively, a failure to take a matter into account would not automatically
justify the setting aside of a decision where the matter was so insignificant that it
could not have materially affected the decision. Other matters may not have been
mentioned because they were regarded as having little or no weight. The failures
relied upon by the MUA fell into this category.
Consideration
Validity of the Order
[26] We reject the MUA’s submission that the Order was invalid because it did not identify
the specific industrial action which was “being engaged in” and was thereby suspended by the
Order. That submission was founded upon an interpretation of s.425(1) that we likewise
reject, namely that the duty to make an order suspending protected industrial action where
such a suspension is appropriate is confined to suspension of the particular protected
[2016] FWCFB 711
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industrial action which is identified as being engaged in at the time a decision is made under
s.425(1).
[27] While the MUA’s interpretation of s.425(1) is one that may be available on the
language of the provision, a range of contextual considerations strongly indicate that it does
not accord with the meaning of the provision intended by the legislature. We consider that the
correct interpretation of s.425(1) is that the purpose and effect of any order required to be
made under the provision is to suspend the protection or immunity attaching to any industrial
action authorised to be taken by a protected action ballot.
[28] The strongest indicator of this is s.413(7). Section 413(1) states that “This section sets
out the common requirements for industrial action to be protected industrial action for a
proposed enterprise agreement”. Section 413(7), which is therefore one of those
requirements, relevantly provides:
No suspension or termination order is in operation etc.
(7) None of the following must be in operation:
(a) an order under Division 6 of this Part suspending or terminating industrial
action in relation to the agreement;
(b) …
(c) …
[29] An order made under s.425 is one made under Division 6 of “this Part” (Part 3-3). The
effect of s.413(7) therefore is that once an order is made under s.425 and while it remains in
effect, any industrial action would not be protected industrial action. The interpretation
advanced by the MUA would set up an incongruity between the terms of the suspension order
and the effect of s.413(7), in that the suspension order would be confined to the particular
type of industrial action being engaged in at the time, but s.413(7) would in any event render
any industrial action non-protected. An interpretation of s.425 by which a suspension order
has the effect of suspending the protection attaching to any industrial action would, in
contrast, be harmonious with s.413(7).
[30] The MUA’s interpretation of s.425 would also not be consistent with its evident
purpose to allow a “cooling off” period in the course of enterprise bargaining in order to
advance the prospects of resolving the matters in issue. If a suspension order was confined in
its effect to a particular type of protected industrial action taken at a particular time, that
would imply that other types of protected industrial action could be taken during the cooling
off period established by the order. That would appear likely to frustrate the objective of the
provision, and it again raises the issue of inconsistency with s.413(7).
[31] That a s.425(1) order operates to suspend generally the protection attaching to
industrial action, and not to prohibit the taking of specific types of industrial action, is
apparent from the fact that the FW Act does not prohibit the taking of industrial action while a
suspension order is in operation or provide for court enforcement of any suspension order
under Part 4-1. This is consistent with the FW Act’s scheme concerning industrial action
under which the taking of industrial action after the nominal expiry date of an enterprise
agreement has passed is not rendered unlawful. The critical effect of the making of a
suspension order is that, by suspending the protection or immunity conferred by s.415, any
[2016] FWCFB 711
14
industrial action which is then taken becomes amenable to an order under s.418 and to any
other remedies which may be available at law.
[32] That the interpretation we prefer is consistent with the intention of the legislature is
confirmed by relevant parts of the Explanatory Memorandum for the Fair Work Bill 2009. In
relation to Division 6 of Part 3-3 generally, the Explanatory Memorandum relevantly stated
(underlining added):
“Division 6 – Suspension or termination of protected industrial action by FWA
1706. Division 6 sets out the grounds upon which FWA may suspend or terminate
protected industrial action organised, or engaged in, in relation to a proposed
enterprise agreement.
1707. Suspension or termination of protected industrial action brings to an end the
right to take protected industrial action. Protected industrial action may be resumed
after any period of suspension, but will be subject to any requirements for the giving
of notice before any action may be taken. A termination of protected industrial action
may lead to FWA making a workplace determination under Part 2-5.”
[33] In relation to s.425 specifically, the Explanatory Memorandum said (underlining
added):
“Clause 425 – FWA must suspend protected industrial action – cooling off
1723. This clause enables FWA to suspend the taking of protected industrial action to
provide for a cooling-off period. Protected industrial action cannot be terminated on
this ground.
1724. FWA is required to make an order suspending protected industrial action if it is
satisfied that it would be appropriate to do so taking into account the following matters
(subclause 425(1)):
• whether suspension would assist the bargaining representatives to resolve the
matters at issue;
• the duration of the protected industrial action;
• the public interest and the objects of the Act; and
• any other relevant matters.”
[34] The interpretation we prefer is also consistent with the Full Bench decision in National
Tertiary Education Industry Union v University of South Australia.10 That decision concerned
the effect of a suspension or termination order made under s.424(1) of the FW Act, which
provides:
Suspension or termination of protected industrial action
10 [2010] FWAFB 1014, (2010) 194 IR 30
[2016] FWCFB 711
15
(1) The FWC must make an order suspending or terminating protected industrial
action for a proposed enterprise agreement that:
(a) is being engaged in; or
(b) is threatened, impending or probable;
if the FWC is satisfied that the protected industrial action has threatened, is
threatening, or would threaten:
(c) to endanger the life, the personal safety or health, or the welfare, of the
population or of part of it; or
(d) to cause significant damage to the Australian economy or an important part
of it.
[35] In relation to an argument that such an order only operated with respect to protected
industrial action which was found to threaten the effects identified in paragraphs (c) and (d) of
s.424(1), the Full Bench said:
“[10] In the present case, it was submitted by the NTEU that the power in s.424 of the
Act is significantly different from that relating to the termination of bargaining periods
under the WR Act. It was said that the power in s.424 is a much more confined and
precise power which is directed at the prevention of particular forms of third party
harm. It is therefore only industrial action which causes the requisite harm that may be
terminated or suspended by FWA under s.424 of the Act.
[11] We do not agree with this construction of the power in s.424. The use of the
words “suspension” and “termination” of protected industrial action in the section may
be contrasted with the power given to FWA in s.418 in relation to the making of
orders to “stop” industrial action. The suspension of protected industrial action is to be
construed as a suspension of the protection or immunity which attaches to the
industrial action under the Act provided it is authorised in a protected action ballot etc.
(see s.409). A reference in s.424 to the making of an order “suspending or terminating
protected industrial action for a proposed enterprise agreement” would therefore seem
to apply to protected industrial action which was authorised by the ballot, and not to
the particular industrial action which is being taken as part of what might be a series of
actions authorised by the ballot and which is having the requisite harmful effect.
[12] This reading of s.424 would accord with the wider scheme of the Act and, in
particular, with the provisions which apply to the making of workplace determinations
where an order has been made terminating protected industrial action (see s.266). It
would be inconsistent with that scheme if further protected industrial action was able
to be taken even though the jurisdiction for the making of an arbitrated determination
was in train (see Ambulance Victoria v LHMU [2009] FWA 44, Kaufman SDP). There
is no valid reason for adopting a fundamentally different interpretation of s.424 in
respect of the power to suspend protected industrial action than is applied in relation to
the termination power.
[2016] FWCFB 711
16
[13] In any event, we note that even if an order made under s.424 was confined to part
only of the authorised industrial action, the effect of the order would be to render other
industrial action unprotected. The common requirements that apply for industrial
action to be protected industrial action are set out in Subdivision B of Division 2 of
Part 3-3 of the Act. In particular, s.413(7)(a) provides that industrial action will not be
protected industrial action for a proposed enterprise agreement if there is in operation
“an order under Division 6 of this Part suspending or terminating industrial action in
relation to the agreement”.
[14] We are therefore of the view that the approach adopted by the Senior Deputy
President, in so far it relates to the making of an order suspending all the industrial
action authorised by the protected action ballot, was in accord with the scheme of the
Act.”
[36] We see no reason why a different approach should be taken to s.425.
[37] We consider that, on the proper interpretation of s.425(1), once it is found that
protected industrial action is being engaged in and a state of satisfaction is reached that
suspension of protected industrial action is appropriate, the order that is required to be made is
one which suspends, for the duration of the order, the protection attaching to any industrial
action. There was no dispute that industrial action, at least in the form of the bans at Port
Botany and Fremantle, was being engaged in at the time of the hearing before Vice President
Watson and at the time the Decision and Order were issued. Subject to there being no error in
the formation of the view that suspension was appropriate, we consider that the Order was one
which conformed to the requirements of s.425(1).
Appropriateness of suspension
[38] Under s.425(1), the Commission is required to make an order suspending protected
industrial action if satisfied that the suspension is appropriate taking into account the four
specified matters. In the High Court decision in Coal and Allied Operations Pty Ltd v
Australian Industrial Relations Commission11, reference was made to a decision-making
process whereby “the decision-maker is required to make a particular decision if he or she
forms a particular opinion or value judgment” as constituting an example of discretionary
decision-making where the latitude allowed to the decision-maker as to the choice of the
decision to be made was “quite narrow”.12 The decision-making process required by s.425 of
the FW Act clearly fits this description. As was established in Coal and Allied13, in an appeal
from a decision of this nature it is necessary for the appellant to establish error in the decision-
making process of the type described in House v The King14, namely that the decision-maker
has acted on a wrong principle, has been guided or affected by extraneous or irrelevant
factors, has mistaken the facts, or has failed to take into account some material consideration.
Therefore it is necessary for the MUA, insofar as it challenges Vice President Watson’s
conclusion that the suspension of protected industrial action was appropriate, to demonstrate
error of this nature.
11 (2000) 203 CLR 194
12 Ibid at [19] per Gleeson CJ and Gaudron and Hayne JJ
13 Ibid at [21] per Gleeson CJ and Gaudron and Hayne JJ
14 (1936) 55 CLR 499
[2016] FWCFB 711
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[39] We have earlier set out the appealable errors for which the MUA contends in this
connection. It is not necessary for us to give consideration to all of the matters raised by the
MUA because we are satisfied that the Reasons disclose errors of fact in the consideration
under s.425(1)(a) as to whether suspension would be beneficial to the bargaining
representatives because it would assist in resolving the matters at issue. Those errors are, we
consider, of sufficient significance to vitiate the conclusion that the suspension would be
beneficial to the bargaining representatives and thus the entire assessment of whether
suspension was appropriate.
[40] We have earlier set out or summarised the consideration under s.425(1)(a) in the
Reasons. The Reasons disclose that the critical factual conclusion reached was that the
“elevation of hostilities” between the parties had “precluded the processes of discussion and
negotiation”15 (emphasis added). We consider that this factual conclusion was unsustainable
on the evidence and was, with respect, plainly wrong. We have reached this conclusion for
four reasons.
[41] First, the Reasons disclose a misapprehension as to what occurred in the exchange of
correspondence on 14 January 2016. In its letter, Patrick sought that the three days of
negotiations between the parties which had been previously arranged to take place on 20, 21
and 22 January 2016 should be rescheduled to a later time when Deputy President Booth was
available to facilitate the process. In its reply, the MUA opposed this suggestion, and
threatened further industrial action if the meetings did not proceed as planned. This was
described in the Reasons as a “cancellation” by Patrick of the meetings16, but there is nothing
in the correspondence or in the evidence to support the proposition that the meetings were
ever actually cancelled by Patrick. Patrick did no more than advance a proposal for a
rescheduling of the meetings based on a preference that Deputy President Booth be in
attendance. Thus there could be no basis to conclude that anything in the correspondence of
14 January 2016 demonstrated any preclusion to the continuation of discussions and
negotiations.
[42] Second, the Reasons disclose that Vice President Watson failed to take into account
further correspondence between Patrick and the MUA on the following day, 15 January 2016.
The MUA issued further notices of industrial action on 15 January 2016, with such industrial
action to occur on 25 and 26 January 2016. The references in the Reasons to “the escalation of
industrial action” and “the elevation of hostilities” appear to relate to these notices. But there
was email correspondence from Mr Jones on behalf of Patrick to Mr Tracey of the MUA at
1.54pm on 15 January 2016 which demonstrated that notwithstanding this the issue
concerning the scheduling of the meetings had in fact been resolved in high-level discussions
between the parties. The email read as follows:
“Thank you for getting back to me on my letter of 14 January 2016 and I note your
confirmation that you will not be withdrawing the planned industrial action.
I am encouraged that you also believe that the involvement of DP Booth has been a
positive influence. While we appreciate your desire to proceed with the planned
negotiation dates next week, we remain of the view that the most constructive progress
will be made with DP Booth’s involvement. It would be disappointing if you elected
15 Reasons at [28]
16 Reasons at [25], [28] and [32]
[2016] FWCFB 711
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to escalate industrial action as a result of this request to reschedule and clearly we do
not believe this does anything to help the parties reach agreement.
As I believe you are aware, following recent discussions with Paddy Crumlin and John
Mullen it is proposed, and DP Booth has agreed to make herself available on one day
next week, to have a high level meeting of senior representatives from both our
organisations.
The purpose of the meeting would be to discuss how we believe we can get
negotiations back on track and make commitments to invest the required time to
continue negotiations on DP Booth’s return from leave. The suggestion is that we
would commit a full week if needed during the week commencing 1 February 2016 to
progress negotiations with our respective bargaining teams.
The proposed group to meet for the high level discussion next week would be John
Mullen, Murray Vitlich and myself from Asciano. I would appreciate it if you can
confirm your willingness to attend this meeting and the proposed attendees to
represent the MUA. Based on discussions with Paddy Crumlin, I understand this is
likely to be Paddy Crumlin, Dave Cushion and yourself. We are committed to this
meeting and would seek confirmation of which would be the most suitable date from
the 18, 19 or 20th of January to do so.”
[43] Mr Jones’ characterised the understanding recorded in the above email as a “joint
decision” to escalate the negotiations to a higher level.17 He further gave evidence that this
agreed “high level meeting” was scheduled for 22 January 2016, and that Deputy President
Booth had agreed to return from leave to facilitate the meeting. He also gave evidence that,
consistent with the week of negotiations commencing 1 February 2016 foreshadowed in the
email, the Deputy President was available for the whole of that week to work with Patrick and
the MUA. There is no dispute that the “high level meeting” scheduled for 22 January 2016
actually proceeded (noting that was the day upon which the Decision and Order were issued).
[44] Although Patrick in its letter of 14 January 2016 stated a preference for industrial
action not to proceed during further negotiations, which preference was confirmed in Mr
Jones’ evidence, there was nothing in the evidence to suggest that Patrick’s participation in
future negotiations was conditional upon a cessation of industrial action. Patrick’s email of 15
January 2015 expressly acknowledged that the MUA would not be withdrawing its planned
industrial action but nonetheless communicated agreement as to future dates for meetings. Mr
Jones confirmed in his evidence that Patrick’s policy in the current bargaining round was to
continue to be willing to meet with the MUA notwithstanding the occurrence of protected
industrial action. Additionally, it was an agreed fact in the appeal that the issuing of the
additional notices of protected industrial action on 15 January by the MUA actually occurred
after the agreement recorded in Patrick’s email of that day to hold the high level meeting, but
this did not prevent the meeting proceeding as agreed.
[45] Thus, far from the industrial action precluding discussion and negotiations, the parties
had expressly agreed for further negotiations to occur with the assistance of Deputy President
Booth notwithstanding that it was known that such industrial action would continue.
17 Transcript 21 January 2016, PN522
[2016] FWCFB 711
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[46] Third, paragraph [28] of the Reasons, which we have earlier set out in full, discloses
that the conclusion that discussions and negotiations were precluded was based significantly if
not wholly upon the proposition that there had been no discussions about the “settlement
document” provided by the MUA to Patrick on 6 January 2016, and that the MUA blamed
Patrick for this because of the “cancellation” of the meetings on 20, 21 and 22 January 2016
and Patrick said discussions had been hindered due to the industrial action. That proposition
mistook the relevant facts entirely.
[47] The “settlement document” referred to was a modified proposal advanced by the MUA
in relation to the Part B negotiations for Port Botany. It was not in dispute that the meetings
scheduled for 20, 21 and 22 January 2016 were for the purpose of the Part A negotiations
only, so that there was never any intention on either side to discuss the “settlement document”
at those meetings. The rescheduling of those meetings proposed by Patrick on 14 January
2016 therefore had no relevance to future discussions about the “settlement document”. In the
appeal the MUA stated, without contradiction from Patrick, that it had never submitted at first
instance that it blamed the fact there had been no discussions about the “settlement document”
on Patrick’s letter of 14 January 2016. For its part, Patrick properly conceded that there was
no evidence that the protected industrial action was the reason why there had been no
discussions about the “settlement document”.18 In fact the last Part B meeting for Port Botany
had occurred approximately one month before protected industrial action commenced, and the
evidence did not (as Patrick conceded19) disclose the reason why there had not been any
further Part B Port Botany meetings prior to the commencement of protected industrial action.
[48] Patrick submitted that the high level meetings agreed in the 15 January 2016 email
were not necessarily confined to Level A issues and that it was open for the parties to discuss
outstanding Part B issues, including the “settlement document”, at those meetings. That may,
on the evidence, be accepted. However that demonstrates that, far from the protected
industrial action precluding discussions about the “settlement document”, the parties had
agreed upon a process that allowed such discussions to occur notwithstanding the continuance
of protected industrial action.
[49] Fourth, although the evidence of Mr Jones undoubtedly established that the
continuance of protected industrial action created difficulties in terms of managerial
attendance at bargaining meetings, the evidence did not establish that these difficulties were
such as to preclude attendance. Indeed, the evidence clearly established that, notwithstanding
these difficulties, the relevant managers were available to attend meetings. Patrick’s letter of
14 January 2016 contained no suggestion that its desire to reschedule the meetings planned
for 20, 21 and 22 January 2016 had anything to do with the unavailability of relevant
managers to attend meetings, and Patrick’s email of 15 January 2016 committed its senior
representatives to attendance at a meeting on 22 January 2016 and a week of foreshadowed
meetings starting on 1 February 2016.
[50] The benefit of suspension identified in the Reasons was “to enable proper discussion
and consideration of revised positions and for the parties to access the assistance of Deputy
President Booth”.20 The identification of that benefit was based on the proposition that this
would not occur without a suspension because the “elevation of hostilities” in the form of
18 Appeal transcript PNs 584-585
19 Appeal transcript PNs 600-601
20 Reasons at [31]
[2016] FWCFB 711
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protected industrial action precluded such discussions and consideration from occurring.
However for the reasons we have stated it is clear that such discussions and consideration
involving Deputy President Booth were to proceed irrespective of the continuation of the
protected industrial action. The evidence provided no foundation for the existence of the
identified benefit. This, we consider, caused the exercise of the discretion to miscarry.
[51] It is not necessary therefore to consider the other aspects of the Reasons challenged in
the MUA’s submissions. It is sufficient to observe that the misapprehension as to the facts
concerning the correspondence of 14 January 2016 extended into Vice President Watson’s
consideration of the duration of the protected industrial action for the purpose of s.425(1)(b),
in that in this section of the Reasons reference was erroneously made to “the cancellation of
meetings appear[ing] to represent some hardening of Patrick’s position”.21 For the reasons
stated, there was no cancellation by Patrick of any meetings, nor did it harden its position.
Conclusion and orders
[52] For the reasons stated above, we consider that the Decision and Order were attended
by appealable error such that the exercise of the discretion involved in assessing the
appropriateness of suspension of protected industrial action miscarried. This justifies the grant
of permission to appeal, and requires the appeal to be upheld.
[53] It will consequently be necessary for the Application made by Patrick under s.425 to
be re-determined. We propose to undertake that task ourselves. Because the application needs
to be re-determined by reference to the circumstances existing at the time of re-determination,
it will further be necessary to provide the parties with an opportunity to adduce further
evidence and make submissions concerning events which have occurred since the hearing on
21 January 2016.
[54] We make the following orders and directions:
(1) Permission to appeal is granted.
(2) The appeal is upheld.
(3) The Decision and Order are quashed.
(4) The Application is listed for a telephone directions hearing before Vice
President Hatcher at 5.00pm AEDT on Tuesday 9 February 2016.
VICE PRESIDENT
21 Reasons at [32]
OF THE FAIR WORK MISSION THE
[2016] FWCFB 711
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Appearances:
S. Crawshaw SC with A. Jacka for the Maritime Union of Australia.
H. J. Dixon SC with D. J. A. Mackay of counsel for Patrick Stevedores Holdings Pty Ltd.
Hearing details:
2016.
Sydney:
2 February.
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