1
Fair Work Act 2009
s.739—Dispute resolution
Construction, Forestry, Mining and Energy Union
v
North Goonyella Coal Mines Pty Ltd
(C2016/3934)
Coal industry
DEPUTY PRESIDENT ASBURY BRISBANE, 25 NOVEMBER 2016
Alleged dispute about any matters arising under enterprise agreement and the NES;[s186(6)]
– Approach to dealing with disputes arising under agreement after agreement ceases
operation – Case law – Dispute arising under agreement that has ceased to operate cannot be
continued under later Agreement – Application dismissed.
1. BACKGROUND
[1] On 31 May 2016, the Construction, Forestry, Mining and Energy Union (CFMEU)
applied under s. 739 of the Fair Work Act 2009 (the Act) for the Commission to deal with a
dispute (the 2016 dispute) in accordance with a dispute settlement procedure in the North
Goonyella Underground Mine Collective Enterprise Agreement 2015 (the 2015 Agreement).
In summary, the dispute relates to a number of redundancies of CFMEU members in 2015
and whether the employer, North Goonyella Coal Mines Pty Ltd (North Goonyella), has
complied with provisions of the 2015 Agreement relating to the removal of labour hire and
contractors as a first step to avoid involuntary redundancies (the Dispute). On 1 June 2016 a
notice of listing was issued for a conciliation conference to be conducted on 27 June 2016.
[2] The CFMEU’s dispute application in respect of the 2016 dispute states that the dispute
is in relation to a failure by North Goonyella to follow the selection process in clause 39 of
the 2015 Agreement and to meet obligations under clause 39.4 of that Agreement with respect
to removal of contractors. The relief sought by the CFMEU is an order that North Goonyella
remove all labour hire employees and that employees who filed dispute notifications with the
company be reinstated to their former positions.
[3] On 9 June 2016, Minter Ellison Lawyers on behalf of North Goonyella, filed a
response to the Dispute submitting that the Commission had no jurisdiction to deal with the
Dispute on a number of bases as follows:
[2016] FWC 8360
DECISION
E AUSTRALIA FairWork Commission
[2016] FWC 8360
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1. The 2015 Agreement was not in operation at the time the redundancies in dispute took
effect and any jurisdiction of the Commission to deal with the disputes under the
North Goonyella Underground Mine Collective Enterprise Agreement 2012 (the 2012
Agreement), which was in operation at the relevant time, was extinguished on 2
December 2015 when the 2012 Agreement ceased to operate and was replaced by the
2015 Agreement;
2. The Commission should otherwise decline to deal with the Dispute on the basis that it
would be “manifestly unjust and contrary to the public interest” to do so because the
redundancy process:
a. Was complete in August 2015;
b. Has already been the subject of a dispute before the Commission that was
resolved by a Decision of Senior Deputy President Hamberger, dated 10 July
20151; and
c. Since 10 July 2015 and the filing of this Dispute, the subject matter has not
been further agitated by the CFMEU or any of its members, giving North
Goonyella the right to believe that the disputes would not be pursued and had
been resolved to finality by the Decision of Senior Deputy President
Hamberger.
[4] The 2016 Dispute did not resolve at the conciliation conference and an agreed
timetable to progress the jurisdictional objection was issued. Those Directions provided that
in the absence of any request for Hearing, the jurisdictional objection would be determined on
the papers. No request for Hearing has been received.
[5] Outlines of submissions and an agreed statement of facts were filed by the parties. No
witness statements were filed. In the absence of a request by either party for a hearing, I have
determined this matter on the basis of the material filed in response to the Directions. The
issues for determination are:
1. Whether the Commission has jurisdiction under the dispute settlement procedure in
the 2015 Agreement to deal with a dispute that arose at the time that the 2012
Agreement was in operation; and
2. If so, whether the Commission should, as a matter of discretion, deal with the
Dispute.
2. LEGISLATIVE PROVISIONS IN RELATION TO DISPUTE PROCEDURES
[6] The jurisdiction of the Commission to deal with disputes pursuant to dispute
settlement procedures in enterprise agreements is provided for in ss.738 and 739 of the Act as
follows:
“738 Application of this Division
This Division applies if:
(a) a modern award includes a term that provides a procedure for dealing
with disputes, including a term in accordance with section 146; or
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(b) an enterprise agreement includes a term that provides a procedure for
dealing with disputes, including a term referred to in subsection 186(6); or
(c) a contract of employment or other written agreement includes a term
that provides a procedure for dealing with disputes between the employer and
the employee, to the extent that the dispute is about any matters in relation to
the National Employment Standards or a safety net contractual entitlement; or
(d) a determination under the Public Service Act 1999 includes a term that
provides a procedure for dealing with disputes arising under the determination
or in relation to the National Employment Standards.”
739 Disputes dealt with by the FWC
(1) This section applies if a term referred to in section 738 requires or allows the
FWC to deal with a dispute.
(2) The FWC must not deal with a dispute to the extent that the dispute is about
whether an employer had reasonable business grounds under subsection 65(5) or
76(4), unless:
(a) the parties have agreed in a contract of employment, enterprise
agreement or other written agreement to the FWC dealing with the matter; or
(b) a determination under the Public Service Act 1999 authorises the FWC
to deal with the matter.
Note: This does not prevent the FWC from dealing with a dispute relating to a term
of an enterprise agreement that has the same (or substantially the same) effect as
subsection 65(5) or 76(4) (see also subsection 55(5)).
(3) In dealing with a dispute, the FWC must not exercise any powers limited by
the term.
(4) If, in accordance with the term, the parties have agreed that the FWC may
arbitrate (however described) the dispute, the FWC may do so.
Note: The FWC may also deal with a dispute by mediation or conciliation, or by
making a recommendation or expressing an opinion (see subsection 595(2)).
(5) Despite subsection (4), the FWC must not make a decision that is inconsistent
with this Act, or a fair work instrument that applies to the parties.
(6) The FWC may deal with a dispute only on application by a party to the
dispute.”
[2016] FWC 8360
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[7] The Commission’s powers to deal with disputes derive, in the case of an enterprise
agreement, from the terms of the dispute resolution procedure contained in the enterprise
agreement. As a Full Bench of the Commission concisely observed in CFMEU v North
Goonyella Coal Mines Pty Ltd2: the Commission may deal with a dispute only on application
of a party to the dispute (s.739(6)); is prohibited from exercising any powers limited by the
dispute resolution procedure (s.739(3)); may arbitrate only if the agreed dispute resolution
procedure permits it to do so (s.739(4)); and must not make a decision that is inconsistent
with the Act, the enterprise agreement and any other applicable fair work instrument
(s.739(5)).
[8] To the extent that the Act and the terms of a dispute settlement procedure in an
enterprise agreement authorise the Commission to make decisions as to the legal rights and
liabilities of the parties to an agreement, it authorises the Commission to exercise a power of
private arbitration.3
3. APPROACH TO DEALING WITH DISPUTES AFTER AGREEMENT
CEASES
[9] This case involves questions of whether the Commission can or should arbitrate a
dispute in circumstances where an enterprise agreement that was in effect when the dispute
arose, has ceased to operate and where the enterprise agreement from which the power to deal
with the dispute is said to be derived, was not in operation at the relevant time. There are a
number of cases where this issue and questions arising from it, have been dealt with.
[10] In Stephenson v Senator the Honourable Eric Abetz (Special Minister of State)4
(Stephenson) a Full Bench of the Australian Industrial Relations Commission found that the
Commission’s jurisdiction to exercise powers of private arbitration over the application of a
certified agreement did not survive after that certified agreement had ceased “to be in
operation”. That the certified agreement had ceased to be in operation meant that it was no
longer a certified agreement such that the Act empowered the Commission to deal with a
dispute over its application5 and that once the certified agreement ceased to operate the
Commission’s power granted by that certified agreement also ceased to operate6. Further, the
Full Bench concluded that an accrued right to have a dispute dealt with by the Commission
did not arise.7 The Full Bench came to this conclusion because the agreement had ceased to be
in operation, the particular clauses of the certified agreement (and its replacement) lead to a
construction that the later agreement wholly replaced the earlier agreement, and the particular
provision in the earlier agreement that was subject of the dispute, was not continued in the
later agreement.
[11] Stephenson was endorsed and followed by a Full Bench of Fair Work Australia in
Pulle v Commonwealth8, which was in turn followed by a later Full Bench in de Jonge v
Australian Broadcasting Corporation9. In de Jonge the Full Bench stated:
“The right of a party to have [a dispute resolution process] undertaken is conditioned
by the provisions of the [Workplace Relations] Act we have referred to above and the
terms the parties agreed and reflected in their collective agreements would be the role
of the AIRC should a matter be referred to it.”10
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[12] Stephenson, Pulle and de Jonge were considered in the context of predecessor
legislation to the Act. In APESMA v Jemena Asset Management Pty Ltd11, Commissioner
Bisset reviewed the earlier authorities in the context of the present Act, and considered that
the principles derived from Stephenson remain applicable to arbitral power under the current
Act.12 The Commissioner considered a number of provisions of the Act and concluded that
those provisions had the same effect as the predecessor provisions in previous legislation. The
Commissioner held that there was “nothing discernible” in the present Act suggesting any
general savings provision with respect to applications for the Commission to conduct dispute
resolution.
[13] In CEPU v Jemena Asset Management Pty Ltd13 Deputy President Gostencnik held
that Stephenson, Pulle and de Jong remained “apposite” although they were decided under a
different statutory scheme. The Deputy President also held that the Commission did not have
jurisdiction to deal with a dispute about whether entitlements were owed to employees under
a superseded enterprise agreement.
[14] At the risk of over-simplifying the issue, all of these cases – whether decided under
previous or current versions of the legislation – involve interplay between a current agreement
and a previous agreement or agreements and whether disputes commenced under a previous
agreement or which related to the provisions of a previous agreement (or agreements) could
be continued under a current agreement once the previous agreement had ceased to operate.
Critical to this question is the scope of the dispute settlement procedure on which an applicant
seeking that the Commission deal with a dispute relies, to invoke the jurisdiction of the
Commission. Equally critical is the nature of the dispute that is sought to be dealt with and
whether it is amenable to the relevant dispute settlement process.
[15] In Stevenson the dispute settlement procedure in effect at the point the dispute arose
and was notified to the Commission, empowered the Commission to settle disputes about
matters “covered by the agreement”.14 The dispute settlement procedure in the subsequent
agreement in that case empowered the Commission to deal with disputes relating to its
application. In short, neither of the dispute settlement procedures considered in Stevenson
empowered the Commission to settle disputes about matters other than matters relating to the
application of the agreement or its terms. Although this issue was not the focus of the decision
of the Full Bench in Stevenson one of the grounds upon which it was held that the
Commission did not have jurisdiction to arbitrate the dispute was that the clause on which the
dispute centred was not contained in the current agreement (ie. the agreement operating at the
time the dispute was sought to be arbitrated) and the dispute settlement procedure did not
empower the Commission to deal with a dispute about a matter that did not relate to the
application of the current agreement.
[16] In Pulle, the scope of the dispute settlement procedure was not in issue although the
relevant procedure empowered the Commission to settle disputes over the application of the
agreement. The Full Bench in that case held that on the basis of the authority in Stevenson the
dispute was outside the jurisdiction of the Commission because it arose under and related to a
term in an expired agreement. The Full Bench went on to observe however that there was a
real question about whether the dispute was of a kind that that could be settled under the
relevant dispute settlement procedure.
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[17] In De Jong there were numerous difficulties confronting the Applicant in establishing
jurisdiction of the Commission to deal with the dispute, including the subject matter of the
dispute that had arisen under the relevant agreement in circumstances where the scope of the
dispute settlement procedure the Applicant sought to invoke, limited its application to such
disputes.
[18] In APESMA v Jemena, Commissioner Bissett articulated the relevant principle from
Stevenson as that the Commission’s jurisdiction to deal with a dispute over the application of
an agreement must be conferred by the agreement itself and any limits imposed by the Act. In
finding that the Commission did not have jurisdiction to deal with the dispute in that case, the
Commissioner held that absent a savings provision, the dispute settlement procedure in the
previous agreement could not be invoked with respect to matters arising under that Agreement
once the agreement had ceased to operate.
[19] In CEPU v Jemena, the current agreement limited the application of the relevant
dispute settlement procedure to disputes arising over the application of the agreement. In that
case it was determinative that the dispute was about the application of a term of the previous
agreement and was described as such in the application seeking that the commission deal with
the dispute. In those circumstances, the dispute did not fall within the ambit of the dispute
settlement procedure in the current agreement, notwithstanding that the clause to which the
dispute related was replicated in both the current and previous agreement. Critical to this
finding was the fact that when the dispute arose, the current agreement had not been approved
by the Commission so there was no actual entitlement under the current agreement to an
allowance that was the subject of the dispute and no indication in the current agreement that
the allowance applied retrospectively in any event.
[20] In relation to the argument in that case that the provisions of the current and previous
agreement were identical and that the dispute could be characterised as a dispute about the
proper construction of the current provision, Deputy President Gostencnik said in dismissing
it:
“If I am wrong in that conclusion then, as a matter of discretion I would decline to
express a view about the proper construction of Appendix D of the Current Agreement
absent a factual matrix to which that appendix can properly apply, and further
because this application bears all the hallmarks of an attempt to clothe the
Commission with jurisdiction in relation to an actual dispute that does not arise over
the application of the Current Agreement.”15
[21] A number of general principles can be distilled from the cases. Where a dispute clause
in an enterprise agreement empowers the Commission to settle a dispute about matters arising
under the agreement and a dispute is commenced, the Commission will no longer have
jurisdiction to deal with the dispute if the agreement ceases to operate while the dispute is on
foot, unless the successor agreement has a savings clause, or a dispute settlement term that
empowers the Commission to settle disputes about matters that are not confined to the
application or terms of that agreement.
[22] For example, where a previous agreement and a current agreement contain the same or
a substantially similar provision, and the current agreement has a broad dispute settlement
[2016] FWC 8360
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procedure that is not limited to disputes arising under it, the Commission may have
jurisdiction to continue to deal with a dispute that arose under the previous agreement. In
order to establish jurisdiction to deal with a dispute in such circumstances, it will be necessary
for the Commission to consider the terms of the dispute settlement procedure that is sought to
be invoked as a source of jurisdiction and to characterise the dispute to ascertain whether it is
amenable to being dealt with under the procedure.
[23] There may also be discretionary grounds for the Commission refusing to arbitrate or
deal further with a particular dispute. In this regard, in exercising powers under a dispute
settlement procedure, the Commission may also exercise incidental powers including the
power to dismiss an application or to refrain from arbitrating the matter.
[24] The approach to construing provisions of an enterprise agreement was set out in a
Decision of a Full Bench of the Commission in AMIEU v Golden Cockerel Pty Limited
(Golden Cockerel).16 The principles established in the cases referred to in that decision can be
summarised as follows:
Construction of an agreement begins with a consideration of the ordinary meaning of
its words;17
The agreement must be read as a whole18 and regard must be had to the context and
purpose of the provision being construed;19
Context extends to the entire agreement, other associated documents or the ideas that
gave rise to an expression in a document;20
The words used in an enterprise agreement should not be interpreted in a strict
technical fashion, because those who framed the industrial instrument are often non-
lawyers with a practical frame of mind, drafting words in the context of custom and
practice in an industry or particular enterprise;21
The process of construction is an objective task and it is not appropriate to have regard
to the subjective beliefs or expectations held by one party. The task is to identify the
common intention of the parties as they have expressed it in the terms of their
agreement;22
Search for evident purpose is permissible and meanings which avoid inconvenience or
injustice may be reasonably strained for, however the task remains one of interpreting
a document produced by others and not giving effect to some anteriorly derived notion
of what would be fair or just, regardless of what has been written into the agreement;23
Regard may be had to evidence of the surrounding circumstances before the existence
of ambiguity in an agreement is identified as an aide to interpreting the agreement for
the purposes of determining whether an ambiguity exists, but cannot be used to
contradict the language of the instrument;
If ambiguity is identified extrinsic material may be used as contextual material to aide
in the interpretation of the instrument.24
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4. AGREEMENT PROVISIONS
4.1 The 2015 Agreement
[25] The provisions of the 2015 Agreement said to be relevant to the issues in dispute are:
“2. INCIDENCE AND APPLICATION
2.1 This Agreement applies to and is binding on:
i. the Company; and
ii. employees of the Company employed at the North Goonyella
Underground Mine (Mine) and the North Goonyella Mine Coal
Handling and Preparation Plan (CHPP) who are engaged in the
classes of work contained in Schedule A of the Black Coal mining
Industry Award 2010.
2.2 The Union/s and nominated employees were the bargaining representatives of the
employees covered by this Agreement. The Agreement will cover the Union/s if the
Union/s apply to the FWC to be covered by the Agreement and the FWC approves
such application.
2.3 This Agreement replaces in their entirety all existing written or verbal agreements
and all custom and practices in operation at the Mine and CHPP...
...
37. CONTRACTORS AND EXTERNAL RESOURCES
37.1 Subject to this clause, the Company may utilise contractors and other external
resources in accordance with operational requirements as determined by the
Company from time to time.
37.2 It is not the intent of the Company to permanently substitute or displace the whole
or a part of the Company’s permanent workforce with contractors and other external
resources.
37.3 Contractors and other external resources may, at the Company’s discretion, be
engaged for:
a) specialised tasks;
b) maintenance or upgrade work during major shutdowns;
c) supplementation of the permanent workforce for longwall moves;
d) peak work loadings;
e) new technology or proprietary technology; or
f)
i. in situations where a business case demonstrates that the productivity
and efficiency of the Company’s workforce including management has
failed to meet business plan targets (in terms of volume or cost); and
[2016] FWC 8360
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ii. Such failure is not due to circumstances beyond the control of the
permanent workforce.
37.4 A decision to utilise contractors or external resources to substitute or displace
permanent employees on the basis of the criterion in clause 37.3(f) must not come as a
surprise to the affected portion of the permanent workforce. To this end the Company
will provide notice to the Union/s and employee representatives of any emerging
concerns that it may need to utilise contractors or external resources pursuant to
clause 37.3(f).
37.5 In the vent that the Company determines to utilise contractors on the basis of the
criterion in clause 37.3(f), it will provide to the Union/s and the employee
representatives a written statement of its determination and the reasons for such
determination.
37.6 In the event that the Union/s and other employee representatives dispute the bona
fides of a determination notified pursuant to clause 37.5 such dispute will be
progressed through the dispute resolution procedure in clause 41 but subject to the
following modifications:
a) the dispute will be dealt with on an expedited basis and, as such, steps 1 to
3 will not apply but there will be a discussion between the Company and
District Level Union/s Officials;
b) it will be for the Union/s and employee representatives to demonstrate that
the Company’s decision to use contractors is not justified by the criterion
in clause 37.3(f); and
c) the Company may implement its decision while the dispute is being
arbitrated although the Union/s and employee representatives may seek an
interim determination from the independent arbitrator that the decision to
use such contractors or external resources not be implemented until the
dispute has been finally arbitrated.
...
39. REDUNDANCY
39.1 For the purposes of any redundancies either Voluntary or involuntary the
Company will engage and utilize (sic) the Workplace Change provision within this
agreement.
39.2 The Company will use its best endeavours to avoid the necessity for involuntary
redundancies, which will include the removal of contracts and labour hire as a first
step, except where;
a) There are contractual commitments that prevent this;
b) The work performance by contractors or labour hire is considered to be
specialised work; or
c) Employees are not readily able to perform the work.
...
39.4 Where involuntary redundancies are necessary:
[2016] FWC 8360
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a) The Company will determine the number of employees to be made redundant and
the spread of skills required for the efficient operation of the Mine; and
b) All employees from within the functional work area where a surplus exists will be
interviewed to determine the employees to be retained or retrenched.
A merit-based selection process will be undertaking taking into consideration the
following no particular order:
a) Employment record/length of service
b) Necessary skills mix required by the business;
c) Individual skills and proficiency in those skills;
d) Cases where unsatisfactory performance has been identified and is being managed
including the individual being given the opportunity to correct their behaviour.
The selection method for involuntary redundancies will include reviews by:
a) The immediately Panel/Work Area Supervisors (50% weight);
b) The shift Co-Ordinator/Shift Engineer/Superintendent (25% weight); and
c) The department Manager (25% weight).
…
39.10 To remove any doubt as to the jurisdiction of the FWC to deal with a dispute in
relation to whether the Company has met its obligations under this clause (and
without intending otherwise to affect one way or the other, the proper construction of
this Agreement), in relation to such a dispute, a former employee is deemed to be an
employee for the purposes of the dispute resolution procedure.
...
41. DISPUTE RESOLUTION PROCEDURE
41.1 In the event of any dispute arising as to the interpretation or application of this
Agreement, including matters in relation to the NES and disputes that are expressly
authorised to be dealt with under this clause by another term of the Agreement, the
following procedure will apply.
41.2 The employee may choose to be represented at any stage in this procedure by a
representative/s of their choosing.
STEP 1 The matter will in the first instance be discussed between the employee/s
and the immediate supervisor involved. The supervisor and the employee
shall make every reasonable effort to resolve the matter between themselves.
An agreed time limit will allow the immediate supervisor to investigate the
grievance and respond. If an agreement is reached it shall be recorded in
writing.
STEP 2 If the matter remains unresolved, it will be referred for discussions between
the employee and/or the employee’s representative/s at the Mine or CHPP
and the relevant Department Manager or their representative.
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STEP 3 If the matter remains unresolved, it will be referred for discussion between
the employee and/or the employee’s representative/s and senior Company
representatives.
STEP 4 If the matter remains unresolved, it will be referred to the FWC for
conciliation and, if the dispute remains unresolved, arbitration. In
exercising its powers under this clause the FWC may exercise all powers
and function incidental or associated with the exercise of conciliation or
arbitration.
41.3 By agreement between the respective representatives, any or all of the above
steps may be bypassed in the interest of speedy resolution of the dispute. Either party
may make an application to the FWC for a determination that steps 1 to 3 be bypassed
and the matter proceed directly to conciliation and or arbitration. Such determination
will be by reference to what is fair as between the parties and the extent of any
prejudice to a party that will be caused unless those steps are bypassed and on the
basis that ordinarily the steps should only be bypassed where a failure to do so will
sound in material prejudice to the Company or affected employees.
41.4 While the steps are being followed, work will proceed in according with the
reasonable and lawful directions of the Company and in accordance with the
employees’ skills, competence, training and safe work practices.”
4.2 The 2012 Agreement
[26] There were similar (but not identical) provisions in the 2012 Agreement dealing with
Contractors and External Resources, Redundancy and Dispute Resolution. Those provisions
were as follows:
“36. Contractors and External Resources
36.1 Subject to this clause, the Company may utilise contractors and other external
resources in accordance with operational requirements as determined by the Company
from time to time.
36.2 It is not the intent of the Company to permanently substitute or displace the
whole or a part of the Company’s permanent workforce with contractors and other
external resources.
36.3 Where the Company decides to utilise contractors and other external resources
after communication with the affected employees and/or employee representative at
the Mine, the Company must ensure that employees of such contractors and other
external resources will be entitled to a Weekly Base Rate of pay that is not less than
the Weekly Base Rates for the equivalent or comparable classification in clause 17 or
Schedule A.
36.4 Contractors and other external resources may, at the Company’s discretion, be
engaged for:
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a) specialised tasks;
b) maintenance or upgrade work during major shutdowns;
c) supplementation of the permanent workforce for longwall moves;
d) peak work loadings;
e) new technology or proprietary technology; or
f)
(i) In situations where a business case demonstrates that the productivity
and efficiency of the Company’s workforce including management has failed to
meet business plan targets (in terms of volume or cost); and
(ii) Such failure is not due to circumstances beyond the control of the
permanent workforce.
36.5 A decision to utilise contractors or external resources to substitute or displace
permanent employees on the basis of the criterion in clause 37.4(1) must not come as a
surprise to the affected portion of the permanent workforce. To this end the Company
will provide notice to the Union of any emerging concerns that it may need to utilise
contractors or external resources pursuant to clause 37.4(1).
36.6 In the event that the Company determines to utilise contractors on the basis of
the criterion in clause 37.4(1), it will provide to the Union a written statement of its
determination and the reasons for such determination.
36.7 In the event that the Union disputes the bona fides of a determination notified
pursuant to clause 37.6 such dispute will be progressed through the dispute resolution
procedure in clause 42 but subject to the following modifications:
(i) the dispute will be dealt with on an expedited basis and, as such, steps
1 to 3 will not apply but there will be a discussion between the Company and
District Level Union Officials;
(ii) it will be for the Union to demonstrate that the Company’s decision to
use contractors is not justified by the criterion in clause 37.4(1); and
(iii) the Company may implement its decision while the dispute is being
arbitrated although the Union may seek an interim determination from the
independent arbitrator that the decision to use such contractors or external
resources not be implemented until the dispute has been finally arbitrated.
…
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38. Redundancy
38.1 Employees will be entitled to the severance and redundancy entitlement
provided in the Award. The entitlement shall be based on the Aggregate wage rate as
provided for in Schedule C. (Aggregate Wage) of this Agreement. All other provisions
in the Award which relate to redundancy shall apply to employees covered by this
Agreement.
38.2 Should the Company decide to reduce the number of employees covered by this
Agreement the parties will consult about the proposed terminations, measures to avoid
or minimise the terminations and measures to mitigate any adverse effects of any
terminations on the employees concerned.
38.3 The measures which will be the subject of consultation will include the
removal of contractors (with the exception of contractors performing specialised
tasks), and reductions in supplementary labour and temporary and fixed term
employees.
38.4 Should the Company decide to reduce the number of employees covered by this
Agreement the Company will first attempt to achieve the required redundancies by
volunteers. The Company has the right to refuse individual applications for voluntary
redundancy to ensure that there are sufficient skills to operate the Mine.
38.5 The Company will consider providing training assistance, financial advice
and/or other employment options to the retrenched employees. Subject to Peabody’s
Recruitment Policy, every endeavour will first be made to redeploy retrenched
employees to another Peabody operation at Peabody’s expense. Where relocation to
any another location is required the Company will pay up to $5,000 in relocation costs
on production of receipts.
…
Involuntary Redundancy – Selection Criteria
a) Subject to paragraphs (b) and (c), the Company will select employees for
involuntary redundancy on reverse merit utilising selection criteria reasonably chosen
by the Company based on its business needs, including but not limited to an
employee’s skills/competencies, experience and aptitudes. To remove doubt, the
Company may utilise performance, attitude, absenteeism record and disciplinary
history as selection criteria.
b) In making a selection pursuant to paragraph (a), the Company must also give
material weight to an employee’s length of service at the Mine and/or CHPP to the
intent that an employee with a long period of service should not be selected for
redundancy unless they are reasonably assessed against the other selection criteria as
materially worse than other employees with a materially lesser period of service in the
relevant class or classes of employees from among whom the selection is being made.
c) To the extent that performance and/or attitude are utilised as selection criteria,
the Company must not make a materially adverse assessment of an employee against
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either or both of those criteria as an individual (as distinct from assessment as part of
a group eg. a crew) unless the employee has been informed (either verbally or in
writing) by a supervisor or manager of relevant concerns about his or her
performance and/or attitude. The intent of this paragraph is that an employee should
not be assessed adversely on the basis of poor performance and/or poor attitude as an
individual unless the employee is aware of management concerns in that regard and
has had a reasonable opportunity to consider and if necessary address those concerns.
d) To the extent that, as at the time this Agreement commences to operate, the
Company has material concerns about the performance and/or attitude of an employee
it must, within three months of such commencement, give that employee written notice,
expressed to be in accordance with this paragraph, broadly outlining those concerns
and provide such employee with an opportunity (if the employee so wishes) to discuss
those concerns with a supervisor or manager. No dispute can be raised over the
issuing of a notice under this paragraph. Rather, the occasion for an employee to
dispute the issuing or contents of such a notice will be if and when a matter adverted
to in the notice is sought to be relied upon by the Company in connection with a
process for involuntary redundancies, disciplinary action or performance
management.
e) In the event of any dispute about a selection process the Disputes Clause under
Sect 42 shall apply.
…
41. Dispute Resolution Procedure
41.1 In the event of any dispute arising as to the interpretation or application of this
Agreement, including matters in relation to the NES and disputes that are expressly
authorised to be dealt with under this clause by another term of the Agreement, the
following procedure will apply.
41.2 The employee may choose to be represented at any stage in this procedure by a
representative/s of their choosing.
STEP 1The matter will in the first instance be discussed between the employee/sand
the immediate supervisor involved. The supervisor and the employee shall make every
reasonable effort to resolve the matter between themselves. An agreed time limit will
allow the immediate supervisor to investigate the grievance and respond. If an
agreement is reached it shall be recorded in writing.
STEP 2If the matter remains unresolved, it will be referred for discussion between the
employee and/or the employee’s representative/s at the Mine or CHPP and the
relevant Department Manager or their representative.
STEP 3If the matter remains unresolved, it will be referred for discussion between the
employee and/or the employee’s representative/s and senior Company representatives.
STEP 4If the matter remains unresolved, it will be referred to FWA for conciliation
and, if the dispute remains unresolved, arbitration. In exercising its powers under this
[2016] FWC 8360
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clause FWA may exercise all powers and functions incidental or associated with the
exercise of conciliation or arbitration.
41.3 By agreement between the respective representatives, any or all of the above
steps may be bypassed in the interest of speedy resolution of the dispute. Either party
may make an application to FWA for a determination that steps 1 to 3 be bypassed and
the matter proceed directly to conciliation and or arbitration. Such determination will
be by reference to what is fair as between the parties and the extent of any prejudice to
a party that will be caused unless those steps are bypassed and on the basis that
ordinarily the steps should only be bypassed where a failure to do so will sound in
material prejudice to the Company or affected employees.
41.4 While the steps are being followed, work will proceed in accordance with the
reasonable and lawful directions of the Company and in accordance with the
employees’ skills, competence, and training and safe work practices.”
5. AGREED STATEMENT OF FACTS
[27] North Goonyella’s jurisdictional objection proceeded on the basis of an Agreed
Statement of Facts with appended supporting documentation. The Agreed Statement of Facts
was as follows:
“1. On 23 May 2012, the North Goonyella Underground Mine Collective Enterprise
Agreement 2012 came into operation.
2. Between 23-24 July 2015, 26 employees of the respondent (NGC) were notified that
their positions were redundant and that their employment would be terminated with
effect from 24 July 2015.
3. 21 employees filed dispute notifications on the days that each of them were (sic)
informed that their employment was to be terminated by reason of redundancy.
4. On 5 August 2015, Luke Ludlow (CFMEU NGC Lodge President) sent an email to
Scott Moran (NGC HR Superintendent) containing a letter (erroneously dated 2 July
2015) notifying a dispute in relation to the use of external/contractor resources at
NGC.
5. On 6 August 2015, a letter from Mike Carter (NGC General Manager) was sent to
Luke Ludlow acknowledging and responding to the employee dispute notifications
contained in [the letters referred to in 3 above].
6. On 18 August 2015, Scott Moran sent an email to Luke Ludlow responding to the
dispute notification of 2 August 2015 (this is referring to the 5 August 2015 dispute
notification at 4 above) relating to the use of external/contractor resources.
7. On 23 August 2015, Luke Ludlow responded by email to Scott Moran’s letter of 18
August 2015.
[2016] FWC 8360
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8. On 16 September 2015, Luke Ludlow sent correspondence to Scott Moran in
relation to the dispute notified in (sic) on 2 August 2015 relating to the use of
external/contractor resources.
9. On 1 October 2015, Luke Ludlow sent correspondence to Scott Moran replying to
Mike Carter’s letter of 6 August 2015 regarding the 21 employee dispute notifications.
10.On 6 November 2015, Scott Moran sent correspondence to Luke Ludlow outlining
NGC’s position in regards to the use of external/contractor resources.
11. On 12 November 2015, representatives of the CFMEU and NGC met to discuss
both disputes relating to the 21 employee redundancies and the use of
external/contractor resources.
12. On 13 November 2015, Chris Brodsky (CMFEU District Vice-President) sent
correspondence to Mike Carter in relation to the meeting of 12 November 2015, which
correspondence proposed the terms for the settlement of all outstanding disputes
involving NGC and its employees.
13. On 2 December 2015, the North Goonyella Underground Mine Collective
Enterprise Agreement 2015 came into operation.
14. On 9 December 2015, Scott Moran sent an email to Chris Brodsky and Luke
Ludlow attaching a letter from Mike Carter dated 8 December 2015. The letter
outlined NGC’s rejection of the 12 November 2015 proposal and provided a counter
proposal.
15. On 14 December 2015, Luke Ludlow sent an email to Scott Moran rejecting
NGC’s counter-proposal and restating the 13 November 2015 proposal.
16. On 15 December 2015, Scott Moran sent an email to Luke Ludlow again rejecting
the 13 November 2014 proposal.
17. On 31 May 2016, the CFMEU filed an F-10 Application for the Commission to
deal with a Dispute in Accordance with a Dispute Settlement Procedure seeking ‘an
order that [NGC] remove all labour hire employees and that employees who filed
dispute notification (sic) with the company be reinstated to their former position’.”
6. DISPUTATION ABOUT REDUNDANCIES AT NORTH GOONYELLA
[28] There is an extensive history of disputation and litigation between the CFMEU and
North Goonyella in relation to successive rounds of restructuring resulting in redundancies at
North Goonyella in 2013 and 2015. That history is set out in some detail in a Decision of a
Full Bench of the Commission in CFMEU v North Goonyella Coal Mines Pty Ltd 25 and can
be summarised as follows.
[29] In July 2013 North Goonyella determined to make a number of CFMEU members
redundant. The CFMEU disputed the redundancies. Discussions between the Company and
[2016] FWC 8360
17
the CFMEU did not resolve the dispute and North Goonyella engaged in a selection process
on the basis of an insufficient number of volunteers for the number of redundancies it
required.
[30] In August 2013 the CFMEU made an application under s. 739 of the Act (the August
2013 application) for the Commission to deal with a dispute in relation to an alleged failure
on the part of the Company to comply with its obligations to consult and to follow an agreed
process with respect to the implementation of redundancies in accordance with the 2012
Agreement.26 On 8 August 2013, I conducted a conciliation conference in relation that
application and issued a Statement and Recommendation including a timetable for
redundancies. North Goonyella proceeded to implement the redundancies and selected 36
employees for redundancy including three officials/representatives of the CFMEU. Those
redundancies were effected on or around 27 August 2013.
[31] On 24 September 2013, the CFMEU instituted proceedings in the Federal Court of
Australia in which it alleged that the three officials/representatives of the CFMEU had been
dismissed in breach of general protections provisions in the Act and clause 38.5(c) of the
2012 Agreement.27 The Federal Court trial in relation to the CFMEU’s application concerning
the three officials/representatives who were dismissed in August 2013 was scheduled to
commence on 2 December 2013. On the first day of the trial, North Goonyella admitted
contraventions of the Act in relation to those dismissals. On 10 December 2013, the Federal
Court (Justice Logan) issued a judgment and made declarations and orders concerning the
admitted contraventions and reinstated the three officials/representatives.
[32] On 25 October 2013, the CFMEU lodged a further application with the Fair Work
Commission under s. 739 of the Act (the October 2013 Application). The October 2013
Application sought restoration of the status quo before the implementation of the involuntary
redundancies, reinstatement of the other employees who had been dismissed on 27 August
2013 and compensation. Between November 2013 and May 2014, I conducted conciliation
conferences in relation to the October 2013 application but resolution was not reached and the
CFMEU sought arbitration of the dispute.
[33] North Goonyella contended that the Commission should refuse to arbitrate the dispute
and that the application should be dismissed on discretionary grounds including that it would
not be in the public interest to require the Company to review and reapply its selection
process and to reverse redundancies which had been effected in August 2013.
[34] In a decision issued on 26 September 2014, I declined to exercise discretion to dismiss
the October 2013 application on the basis that the issues raised by North Goonyella were
more appropriately dealt with by the member to whom the dispute was allocated for
arbitration and were not appropriate grounds for the Commission to dismiss or refrain from
hearing the application. I also determined that the application should be arbitrated by another
member of the Commission, on the basis I had been involved in conciliation and had been
privy to offers and counter-offers of settlement.
[35] The October 2013 application was subsequently allocated to Commissioner Lewin,
who in a Decision issued on 15 May 2015 (delay being caused by what the Commissioner
described as prevarication by the CFMEU) concluded that the Commission did not have
[2016] FWC 8360
18
jurisdiction to deal with the October 2013 application because the relevant employees were
not employed by North Goonyella at the time the application was made and accordingly the
persons on whose behalf the dispute was raised were not persons to whom the dispute
settlement procedure in the 2012 Agreement could apply. Commissioner Lewin also found
that if the agreed selection procedure and the earlier Recommendation made by me in relation
to the August 2013 Application had not been followed, there may be an unresolved aspect of
the August 2013 Application which remained to be dealt with under the dispute settlement
procedure and determined that this matter would be listed for further hearing. Prior to the
matter being heard, Commissioner Lewin reached statutory retirement age. The dispute was
allocated to another member of the Commission and is yet to be determined.
[36] On 21 June 2015, the CFMEU made a new application for the Commission to deal
with a dispute in relation to a further restructuring of operations by North Goonyella (the
2015 application). In that application, the CFMEU asserted the dispute related to clauses 37
and 38 of the 2012 Agreement and that North Goonyella had breached consultation
obligations under the Agreement by failing to:
provide employees who had expressed an interest in being made voluntarily
redundant with a breakdown of their redundancy entitlements; and
finalise a formal outline of the proposed new organisational structure for the mine.
[37] I conducted a conciliation conference into the 2015 application on 23 June 2015 and
when it was not resolved, the dispute was referred for arbitration. The CFMEU then filed a
further application on 28 June 2015 in relation to the process of selecting employees for
involuntary redundancy and asserting that the provision of the 2012 Agreement to which the
dispute related was clause 41. Both applications were dealt with by Senior Deputy President
Hamberger.
[38] In a Decision issued on 10 July 2015, the Senior Deputy President found that North
Goonyella had met its consultation obligations under clause 38 of the 2012 Agreement and
that the Company’s proposals with respect to contractors were consistent with its obligations
under clause 36 of the 2012 Agreement. His Honour went on to find that there was a lack of
evidence to suggest that North Goonyella had put into place any arrangements to ensure
compliance with its obligations under clause 38.5(c) and (d) of the 2012 Agreement in
relation to selection criteria for redundancy and that equally, there was no evidence that North
Goonyella had failed to meet those obligations. His Honour declined to make an order in the
terms sought by the CFMEU that the employer refrain from terminating any employee on the
basis of involuntary redundancy until the commission arbitrates and determines the 2013
dispute or any residue thereof.
[39] In June 2015 the CFMEU appealed the earlier Decision of Commissioner Lewin. In a
Decision issued on 30 October 2015, a Full Bench of the Commission dismissed the appeal
finding that there was no attempt by the CFMEU to engage the dispute procedures in the 2012
Agreement in respect of the October 2013 Application at a time when any of the employees
party to the dispute were actually employed and on that basis there was no power for the
Commission to deal with the dispute under s. 739 of the Act. The Full Bench also noted that
there was a lack of utility in the appeal because, as stated in the Decision of Commissioner
Lewin, it remained open to the CFMEU to re-agitate the August 2013 Application on the
[2016] FWC 8360
19
basis of its contention that North Goonyella failed to comply with my Recommendation of 9
August 2013. The Full Bench went on to state in respect of the August 2013 Application:
“That application squarely raised the issue of the selection process adopted by North
Goonyella in respect of involuntary redundancies. We consider if that application is
demonstrated not to have been resolved by the Deputy President’s Recommendation (a
matter about which we express no view), the Commission would in proceeding to deal
with it be entitled to take into account developments in the selection process after the
application was made and, in particular, any contention that the process did not
comply with clause 38 of the Agreement. There is nothing in s. 739 of the Act, or in
clause 41 of the Agreement, which would prevent the Commission from dealing with
any development or evolution in a dispute which occurs after application is made to
the Commission to deal with the dispute. The CFMEU can therefore agitate its
members’ concerns about the selection process for the August 2013 involuntary
redundancies in the August 2013 application subject to it demonstrating that the
application was not settled by the Deputy President’s Recommendation.
We would also observe that, to the extent the CFMEU contends that there is an extant
dispute between current employees and North Goonyella about selection procedures
for involuntary redundancies by reference to the events of August 2013, it is not
apparent that anything would prevent the procedure in clause 41 being engaged with
respect to such a dispute.”
7. THE 2016 APPLICATION
[40] The 2016 Dispute application, the subject of these proceedings, states that the dispute
resolution procedure relevant to the application is contained in the 2015 Agreement. The
clause to which the 216 Dispute is said to relate is clause 41, and the CFMEU describes the
dispute as follows:
“1. On or about 5 August [2015] 21 employees filed dispute notifications with the
Respondent disputing their selection for redundancy on the grounds that they believed
that the selection process in clause 39 of the agreement had not been followed
correctly.
2. Further, during consultation and in the Fair Work Commission, representatives of
the Respondent assured the Union that the company was meeting their obligations
under clause 39.2 of the agreement in that they were and already had removed all
contractors and labour hire, except for those allegedly performing specialist work.
3. After the employees who had filed disputes employment was [sic] made redundant it
became apparent that a number of labour hire workers, from a number of labour hire
companies, including OneKey resources, remained in their positions and were
continuing to perform work that was not specialized (sic) and could have been
performed by the employees who were made redundant.
4. The applicant submits that the respondent has failed to appropriately follow clause
39.4 in making the employees redundant.
[2016] FWC 8360
20
5. Further, the applicant submits that the respondent has failed in their obligations to
remove all contractors before making employees forcibly redundant.”
[41] The relief sought by the CFMEU is an “order that the respondent remove all labour
hire employees and that employees who filed dispute notification with the company be
reinstated to their former positions”.
[42] The supporting documentation appended to the Agreed Statement of Facts indicates
that twenty-six employees were notified of their redundancies between 23 and 24 July 2015
and that their employment would be terminated with effect from 24 July 2015. Between 23
and 24 July 2015, twenty-one employees, using internal disputes forms – which state that they
are to be completed by employees who wish to progress a dispute through the Disputes
Resolution Procedure – disputed their redundancies and the selection process.28 In the absence
of evidence to the contrary, I assume that the employment of those 21 persons ended in
accordance with the notifications that were given to them. It is also clear that the disputes
were commenced under the 2012 Agreement.
[43] On 5 August 2015, Mr Ludlow, CFMEU President, North Goonyella Lodge, emailed a
dispute notification to Mr Carter (Senior Site Executive and General Manger of the Mine)
regarding use of contractors at the Coal Handling Preparation Plant (CHPP).29 The letter
attached to the email is (erroneously according to the Agreement Statement of Facts) dated 2
July 2015. The matters set out in the letter notifying the dispute can be summarised as
follows:
Contractor employees are working at the CHPP to cover leave of permanent
employees;
The 2012 Agreement does not provide for use of contractors to cover approved leave
and this is not an accepted practice at the Mine;
During the consultation period regarding reduction of the permanent workforce and
restructure of the mine the Company outlined that use of contract labour at the CHPP
would cease;
This appears to be a false representation given that contract labour is being used at
the CHPP;
The use of contract labour to replace employees absent on leave is not consistent
with clause 37 of the 2012 Agreement and it can only be assumed that the contract
labour employees have been engaged to replace permanent employees made
redundant from the CHPP in July 2015.
[44] The letter concludes with a request that the Company immediately cease the practice
of utilising contract labour and external resources at the Mine in place of permanent
employees made redundant. The letter also asserts that the continued use of labour hire
employees shows that the recent redundancies of the permanent workforce were a design to
replace permanent employees with labour hire, in contravention of clause 39.4 of the 2012
Agreement. There was further correspondence between the parties up until 15 December
2015. It is apparent that the CFMEU continued to raise issues about the 2013 redundancies
and sought to resolve disputes about employees made forcibly redundant in 2013 and 2015.
The final piece of correspondence between the parties is an email from Mr Moran on behalf
[2016] FWC 8360
21
of North Goonyella which denies that the Company has failed to comply with its obligations
in relation to contractor numbers or work scope or that the Company has made false
representations about the continuing utilisation of contractors. The email concludes with the
following statement:
“We are not willing to reconsider our position regarding the CFMEU proposal
provided on 13 November 2015. Unfortunately it appears that we are ‘to far apart’ in
terms of the proposals that have been provided to continue any meaningful discussions
at a State level as far as the dispute resolution process is concerned. The Company is
also not willing to have any further discussions regarding the 2013 redundancies as
part of this dispute resolution process.”
[45] As previously noted the 2012 Agreement ceased to operate on 2 December 2015 when
the 2015 Agreement commenced operation. There is no reference in any of the
correspondence to the 2015 Agreement or to any of its terms.
8. SUBMISSIONS
8.1 North Goonyella
[46] North Goonyella submits that the Commission has no jurisdiction to deal with the
2016 application. The 2015 Agreement referred to in the application, did not come into
operation until 2 December 2015, several months after the redundancies that are the subject of
the 2016 dispute came into effect. According to North Goonyella, the obligations under the
2015 Agreement do not have retrospective effect and cannot have application to the 2015
redundancies. It is further submitted that the dispute notification is incapable of amendment to
invoke the disputes procedure in the 2012 Agreement, which was in effect at the time of the
relevant redundancy process but ceased to operate on 2 December 2015 when the 2015
Agreement replaced the 2012 Agreement. Accordingly, the jurisdiction of the Commission to
deal with the August 2015 disputes was extinguished on that day.
[47] In the alternative, North Goonyella submits that even if the Commission did have
jurisdiction to deal with the disputes, the Commission should decline to do so on the basis that
it would be manifestly unjust and contrary to the public interest for it to do so because the
2015 redundancy process:
was complete in August 2015;
was the subject of a dispute process including a contested Commission hearing
before Senior Deputy President Hamberger in late June 2015, which was resolved by
an arbitrated decision dated 10 July 2015; and
between December 2015 and May 2016, has not been the subject of any further step
by the CFMEU or any of its members.
[48] In relation to jurisdiction, North Goonyella submits that the employment of persons on
whose behalf the application is brought were terminated by reason of redundancy with effect
from late July and early August 2015. Between 23 and 24 July 2015, those employees lodged
disputes with North Goonyella challenging their foreshadowed redundancies and the process.
Further dispute notifications were lodged in August 2015. North Goonyella’s position
[2016] FWC 8360
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following the lodgement of these disputes was that – to the extent there had been genuine
disputes about the process adopted by North Goonyella – those disputes were resolved to
finality by the Decision of Senior Deputy President Hamberger issued on 10 July 2015. North
Goonyella also submits that in any event, no further action was taken in relation to the
disputes lodged with North Goonyella in July and August 2015 until the Form F10
Application subject of these proceedings was filed on 31 May 2016.
[49] Between the present disputes being lodged with North Goonyella and the filing of the
Form F10 Application in relation to those disputes, the 2012 Agreement ceased to operate and
the 2015 Agreement came into effect. In support of the submission that disputes brought
under the 2012 Agreement were extinguished when that Agreement ceased to operate, North
Goonyella referred to a number of decisions of the Commission: Stephenson v Special
Minister of State30; Pulle v Commonwealth31; de Jonge v Australian Broadcasting
Corporation32; APESMA v Jemena Asset Management Pty Ltd33; CEPU v Jemena Asset
Management34. Those decisions are said to establish the following propositions:
The Act does not contain any general saving provision such that an application made
under a dispute settlement procedure will give the Commission jurisdiction to deal
with that dispute once the agreement that contains the procedure ceases to apply;
Where a dispute was brought under the dispute resolution provision of an enterprise
agreement that is no longer in operation, the Commission will have no jurisdiction to
hear that dispute unless the Commission’s jurisdiction to do so is expressly
preserved by a replacement enterprise agreement; and
A dispute commenced under an enterprise agreement dispute resolution provision
does not give rise to accrued rights that continue after the agreement ceases to
operate.
[50] North Goonyella submits that Clause 2.3 (extracted above) of the 2015 Agreement
evidences a clear intention that the 2012 Agreement was to be replaced in its entirety by the
2015 Agreement. Clause 41 of the 2015 Agreement (the dispute resolution procedure) is
limited by its terms to a dispute arising as to the interpretation or application of “this
Agreement”, which includes disputes that are expressly authorised by a term of “the
Agreement” other than clause 41. The clause leaves no room for the continuation of disputes
that predate its commencement or relate to subject matter outside its terms or those of the
NES. Accordingly North Goonyella submits that the Commission lacks jurisdiction to hear
the dispute and that the matter must be dismissed.
[51] North Goonyella also submits that it is not in the public interest for the Commission to
allow the matters to progress at this late stage. Common sense demands that disputes about
redundancy should be progressed diligently, and it is for this reason that Parliament has
placed a 21 day time limit on unfair dismissal or adverse action applications involving
dismissal. The obvious public policy is to ensure that employers and employees have a rapid
resolution of a termination dispute to allow both parties to move on with certainty.
[52] In the present case, apart from formal notifications (which appeared to be in template
form) that employees disputed aspects of redundancy, and a limited exchange of
correspondence which occurred subsequently, neither the CFMEU nor its members have
taken any step since December 2015 to progress their disputes. Even if there was a
[2016] FWC 8360
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jurisdictional basis for the purported attempt to refer the dispute to the FWC, the CFMEU
should not be allowed to “warehouse” the right to do so, to be enlivened at a time of the
CFMEU’s choosing. This is particularly so as disputes which did properly arise in relation to
the August 2015 redundancies under the 2012 Agreement were raised and disposed of
expediently by Senior Deputy President Hamberger pursuant to his Decision dated 10 July
2015.
[53] According to North Goonyella’s submission it is not mandatory for the Commission to
exercise a power to resolve disputes in any particular way or even at all. The present case is
an example of an attempt by a representative party to a disputes procedure seeking to use it
other than genuinely in good faith, and for reasons unrelated to the purpose of the procedure,
which is to resolve disputes about the application of the procedure efficiently and
expeditiously. Ever if there was jurisdiction for the Commission to deal with the alleged
dispute in the present case, it would be appropriate for it to decline to do so.
[54] In response to the CFMEU submission in relation to Ponczek v Serco Australia
(summarised below), it was submitted by North Goonyella that the dispute procedure in that
case allowed for any dispute to be resolved in contrast with the procedure in the present case
which is limited to disputes arising under the 2015 Agreement. North Goonyella also submits
that clause 41.1 of the 2015 Agreement is not ambiguous and cannot be construed by
reference to evidence of surrounding circumstances including conduct of the parties. Further,
the letter of 15 December 2015 which the CFMEU relies on as evidence of agreement by
North Goonyella to continue the dispute after the 2012 Agreement ceased, falls short of
establishing objective background facts known to all parties at the time of negotiations for the
2015 Agreement such as would displace the ordinary meaning of the words contained in
clause 41.1. In any event the letter cannot be used to impute consent on the part of North
Goonyella to the Commission dealing with the dispute, on the basis that a party cannot
consent to jurisdiction where none exists.
[55] If any difference in the substantive clauses that gave rise to the dispute, as between the
2012 and the 2015 Agreement, is relevant then the apparent differences between the clauses in
the two agreements militate against a view that disputes under the 2012 Agreement can be
continued under the 2015 Agreement. In this regard, clause 39 of the 2015 Agreement, which
is relied on by the CFMEU, contains onerous requirements relating to the removal of
contractors that were not contained in the 2012 Agreement.
[56] In any event, the issue is whether the Commission has jurisdiction to deal with the
matter. The dispute arose under the 2012 Agreement. The dispute did not arise under the 2015
Agreement and does not concern it. It does not matter that if the facts had occurred under the
2015 Agreement the respective rights and obligations of the parties would have been similar
or even identical. What is relevant is which Agreement was in force at the time the dispute
actually arose. It is further submitted that the CFMEU’s allusions to prejudice and equity can
have no relevance. While a narrow or pedantic approach to enterprise agreement
interpretation should be avoided, the Commission is not free to give effect to some anteriorly
derived notion of what would be fair and just regardless of what is written in the 2015
Agreement.35
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8.2 CFMEU
[57] The CFMEU agrees that the 2012 Agreement was replaced by the 2015 Agreement
with effect from 2 December 2015. The CFMEU also agrees that a dispute was initiated while
the 2012 Agreement was in effect and in relation to terms and conditions contained in the
2012 Agreement. However, it is the CFMEU’s position that the current dispute has been
initiated under the disputes procedure in the 2015 Agreement and that the Commission has
power to deal with the dispute in accordance with s. 738 of the Act.
[58] In support of this position, the CFMEU referred to the Decision of Commissioner
Bissett in Ponczek v Serco Australia Pty Ltd.36 In that case the Respondent raised a
jurisdictional objection alleging that as the dispute involved the payment of a travel allowance
under an agreement which had been replaced, the Commission lacked jurisdiction to deal with
the dispute. Commissioner Bissett dismissed the jurisdictional objection and found that the
Commission did have jurisdiction to deal with the dispute on the basis that the disputes
procedure in the relevant agreement covered a wider range of disputation than provided for in
s. 186 of the Act.
[59] While the dispute settlement provision in the 2015 Agreement refers to a more limited
range of matters than the provision considered in Ponczek, the CFMEU submits that the
Commission should rely on this Decision as a precedent in the present case because the
conduct of the parties during the disputes process “invites an inference” that they intended the
disputes procedure of the 2015 Agreement to apply to the current dispute which arose and
pertained to the 2012 Agreement.
[60] The Agreed Statement of Facts evidences that the parties maintained correspondence
about the dispute after the 2015 Agreement came into effect. The last correspondence from
the Company makes no mention of the current dispute being extinguished at that point and in
fact states that any “meaningful discussions” could be held at State level, a term used in Step
3 of the dispute procedure in the 2015 Agreement. The CFMEU submits that this statement
shows that the Company clearly intended the disputes process – now the process under the
2015 Agreement – to continue. As the Step 3 process “would not be meaningful” the Union
was free to escalate the dispute to Step 4, which it did.
[61] The conduct of the parties shows a clear indication that the 2015 disputes process
intended to apply to the dispute that was on foot between the parties about the 2015
redundancies and subsequent continual maintenance of labour hire workers on site. As in
Poczek, the disputes procedure in an agreement can be used to dispute a range of issues
between the employer and employee/representative and in the present case, although the
disputes procedure pertains to disputes in relation to “this agreement” the parties indicated an
intent to continue with the previous dispute from the 2012 Agreement under the disputes
procedure in the 2015 Agreement.
[62] The CFMEU also submits that the cases referred to by North Goonyella can be
factually distinguished from the current matter. This is not a case where the dispute was
lodged without the Company’s knowledge or was raised after the 2012 Agreement had ceased
to operate. The Statement of Agreed Facts clearly shows that both parties were notified and
understood each other’s position in regards to the dispute through the second half of 2015.
[2016] FWC 8360
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The parties were unable to reach agreement and continued with the dispute after the 2015
Agreement came into effect. There was no indication from North Goonyella that it viewed the
dispute as having been extinguished and the dispute was continued after that time.
[63] Further, the dispute relates to the involuntary redundancy of 21 employees, and
the company’s decision to remove some contract labour prior to involuntary redundancies as
per clauses 37 and 38 of the 2012 Agreement. The coverage of the 2015 Agreement is
identical to that of the 2012 Agreement. Unlike the cases of APESMA v Jemena Asset
Management Pty Ltd and CEPU v Jemena Asset Management Pty Ltd37 the two clauses
pertaining to the dispute are largely replicated in the 2015 Agreement, with some minor
changes, and do not involve the coverage of the two agreements. It is also submitted that,
unlike the decision in Stephenson, clause 2.3 of the 2015 Agreement does not operate to
extinguish the dispute on foot. Clause 2.3 merely relates to “written or verbal agreements and
all custom and practice at the Mine and CHPP”. The Union submits that a dispute is
neither of these and therefore clause 2.3 does not operate to replace or remove the dispute in
question.
[64] The CFMEU contends that under such circumstances it would be inequitable to state
that the jurisdiction to hear the dispute was ‘extinguished’ merely because the dispute was not
lodged with the FWC before the expiration of the 2012 Agreement and the Union submits that
because the Respondent showed an intention to continue to deal with the dispute under the
2015 Agreement, the FWC does have jurisdiction under s.738 to deal with the dispute. This is
consistent with the Object of the Act as set out in s. 3(e) of “enabling fairness and
representation at work and the prevention of discrimination by…providing accessible and
effective procedure to resolve grievances and dispute procedures…”
[65] In relation to the submission that it is not in the public interest for the matter to
proceed, the CFMEU submits that nowhere in the 2015 Agreement, or the 2012 Agreement,
does it state that a specific “time limit” applies for the escalation of disputes. The reliance by
North Goonyella on the 21 day limit for unfair dismissal applications in this regard is
irrelevant because:
The CFMEU has not claimed that the employees who were made redundant were
unfairly dismissed, within the definition of s.387 of the Act;
The employees’ concerned raised the matter immediately through their Union
delegate; and
Both parties clearly ventilated the issues through the disputes process and were
left with a clear understanding in relation to their respective positions.
[66] In such circumstances, North Goonyella is not prejudiced by the delay in the CFMEU
filing the matter with the Commission and there is no basis for the assertion that the Union
has not used the disputes process genuinely and in good faith. In relation to the submission
that the issues were “disposed of expediently by Senior Deputy President Hamberger,
pursuant to his decision dated 10 July 2015,” the CFMEU submits that in his decision, the
Senior Deputy President identified a number of outstanding issues that he was unable to deal
with at the time and it is these issues that the Union is now seeking to dispute in the
Commission.
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[67] As outlined in the Form F10 the CFMEU seeks reinstatement for the employees who
were made redundant. However, as an alternative, the CFMEU submit s t ha t if the
Commission finds that it has jurisdiction to hear the dispute and find that North Goonyella
has not complied with its obligations under the 2012 Agreement with regards to the use of
contractors and/or the redundancy of employees in July 2015, but that reinstatement is not
practicable, then the Union believes that payment of compensation is an alternative outcome.
[68] In support of this submission, the CFMEU relies upon the Decision of a Full Bench of
the AIRC in The Muincipal Officer’s Association of Australia v Roads Corporation of Victoria
and others38. In that case, the Full Bench recognised that the employer had a right to make
decisions regarding operational, training and workforce requirements. However, it was
considered in the circumstances of that case that the treatment of the employees and
apprentices who were terminated was contrary to equity and good conscience. Those
employees were awarded compensation with an additional 6-8 weeks wages.
[69] In this matter, if reinstatement was found to be impracticable, the C F M E U
w o u ld be submitting that the termination of employees, via forced redundancies, whilst
labour hire employees remained at work, contrary to the agreement, was contrary to equity
and good conscience and that therefore a payment of compensation to those ex- employees
would be appropriate. While the case referred to above was decided under the previous
Workplace Relations Act 1996, the CFMEU submits that such an order is not prevented and
within the power given the FWC within s739 (3) of the Act and clause 41 of the 2015
Agreement.
9. CONSIDERATION
9.1 Does the Commission have jurisdiction to deal with the present application?
[70] As previously noted, the Form F10 Application for the Commission to deal with the
present dispute states that the 2015 Agreement covers the employment relationship and
contains the dispute resolution procedure relevant to the application. It is also stated that the
dispute resolution clause number is clause 41. Clause 41 of the 2015 Agreement is entitled:
“Dispute Resolution Procedure”. I note that the dispute resolution procedure in the 2012
Agreement is also found at clause 41. However there is no reference in the Form F10 to the
2012 Agreement and the application before the Commission is premised on the power of the
Commission to deal with the dispute being derived from the dispute resolution procedure in
clause 41 of the 2015 Agreement. By virtue of clause 41.1 of the 2015 Agreement, the dispute
resolution procedure operates with respect to “disputes arising as to the interpretation or
application of this Agreement” and does not extend to any employment related dispute. The
dispute resolution procedure in clause 41 of the 2012 Agreement is limited in the same way.
[71] The clause that the dispute is said to relate to is “clause 39” and it is clear that this
reference is to clause 39 of the 2015 Agreement. Clause 39 of the 2015 Agreement deals with
the subject of “Redundancy”. The dispute is said to be about the alleged failure of North
Goonyella to follow the selection process in clause 39.4 of the Agreement. It is also stated
that the dispute relates to a period after the employees subject of the dispute were made
redundant, and that the Company retained labour hire employees who were performing non-
specialised work that could have been performed by the employees who were made
[2016] FWC 8360
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redundant. This is contended to be a failure by North Goonyella to follow clause 39.2 of the
2015 Agreement by not complying with its obligations to remove all contractors before
making employees forcibly redundant.
[72] In relation to the obligation to remove contractors, clause 39.2 of the 2015 Agreement
provides that the company will use its best endeavours to avoid the necessity for involuntary
redundancies which will include the removal of contractors and labour hire as a first step
except in circumstances where:
Contractual commitments prevent this;
The work performed by labour hire or contractors is considered specialist work; or
Employees are not readily able to perform the work.
[73] However, the redundancies which are the subject of the dispute were implemented
while the 2012 Agreement was in operation. Further, the factual circumstances that gave rise
to the dispute and which are said to constitute failure on the part of North Goonyella to
comply with the provisions of the 2015 Agreement, occurred before the 2015 Agreement
came into operation.
[74] Clause 38.2 of the 2012 Agreement provides as follows with respect to the removal of
contractors as a measure to avoid or minimise the effect of terminations in the event of
redundancy and to mitigate adverse effect on the employees concerned:
“The measures which will be the subject of consultation will include the removal of
contractors (with the exception of contractors performing specialised tasks), and
reductions in supplementary labour and temporary and fixed term employees.”
[75] It will be seen that there are material differences between the provisions of the 2015
Agreement and the 2012 Agreement with respect to obligations in relation to the removal of
contractors in circumstances where employees are to be made involuntarily redundant. The
2012 Agreement requires that the Company consult about removal of contractors as a measure
to mitigate the effects of redundancies on the permanent workforce. The 2015 Agreement
requires that the Company remove contractors as a first step to avoid the necessity for
involuntary redundancies unless one of the aforementioned exceptions applies. The clauses in
both Agreements dealing with the use of contractors and external resources (clause 37 of the
2015 Agreement and clause 36 of the 2012 Agreement) are materially the same with the
exception that the provision in the 2012 Agreement in relation to rates to be paid to contractor
employees did not find its way into the 2015 Agreement. However, the 2016 dispute does not
allege non-compliance with clause 37 of the 2015 Agreement.
[76] The 2016 application alleges non-compliance with clauses in the 2015 Agreement
which were not in effect at the time the alleged non-compliance occurred. In my view this
scenario is analogous to that considered by Deputy President Gostencnik in CEPU v Jemena.
The 2015 Agreement had not been made when the events that gave rise to the dispute
occurred. If there was a breach of provisions relating to selection for redundancy and removal
of contractors then that breach can only have occurred at the time the redundancies were
affected. Further, there can be no breach prior to the operation of the Agreement in which the
provisions alleged to have been breached are found.
[2016] FWC 8360
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[77] The fact that the employees put the matter of their selection for redundancy into
dispute before they were dismissed, does not establish jurisdiction for the Commission to deal
with the dispute in the present case. Those employees were dismissed in late July or early
August 2015 – well before the 2015 Agreement under which the applications to the
Commission are made, came into effect. Those employees cannot be in dispute in relation to
terms of an agreement that never applied to them. A dispute can only be brought under the
2015 Agreement by an employee who is covered by that Agreement. Further, a dispute under
the 2012 Agreement cannot be dealt with under the dispute settlement procedure in the 2015
Agreement. The dispute settlement procedure in the 2015 Agreement applies only to disputes
arising under that Agreement. The decision in Ponczek v Serco does not support the
CFMEU’s argument given that the dispute settlement procedure in that case applied to any
grievance or dispute and was not restricted to matters arising under the agreement in which
the dispute settlement procedure was found.
[78] Further, I do not accept the CFMEU’s submission that the conduct of the parties when
the 2015 Agreement came into effect clearly shows an intention to continue with the dispute
past the expiration of the 2012 Agreement. The fact that correspondence continued cannot
enliven jurisdiction where there is none. I also do not accept that the 2016 dispute relates to
outstanding issues identified by Senior Deputy President Hamberger in 2015. The dispute
before his Honour concerned the 2012 Agreement and any outstanding issue could only have
concerned the terms of that Agreement. Even if the 2015 Agreement contains the same or
similar terms, the dispute procedure in the 2015 Agreement does not apply to disputes in
relation to the terms of earlier agreements.
[79] If I am wrong in my conclusions in relation to jurisdiction, I would dismiss the present
application on public interest grounds. Essentially, the CFMEU is seeking to rearticulate the
same matters that have been comprehensively dealt with by Senior Deputy President
Hamberger in his Decision of 10 July 2015. I also agree with the submission for North
Goonyella that the CFMEU should not be permitted to warehouse rights to bring disputes to
the Commission. The CFMEU did not take any steps to prosecute this matter between
December 2015 and May 2016. I agree with the submission for North Goonyella that disputes
should be dealt with expeditiously particularly where they involve dismissed employees
seeking a remedy including reinstatement when it would impact on the rights of employees
who were not made redundant at the relevant time. The CFMEU has failed to do so and there
are strong public interest grounds for dismissing the application.
10. CONCLUSION
[80] The application by the CFMEU in C2016/3934 is dismissed and an Order to that effect
is issued with this Decision.
DEPUTY PRESIDENT
WORK SOMMISSION THE SEAL OF THE
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Printed by authority of the Commonwealth Government Printer
Price code G, AE416796 PR587764
1 Construction, Forestry, Mining and Energy Union v North Goonyella Coal Mines Pty Ltd [2015] FWC 4405.
2 [2015] FWCFB 5619.
3 Construction, Forestry, Mining and Energy Union v Australian Industrial Relations Commission (‘Private Arbitration
Case’) (2000) 203 CLR 645 [31] – [35].
4 PR952743 [2004] AIRC 1059 (28 October 2004).
5 Ibid at [45] to [46].
6 Ibid at [49].
7 Ibid at [54].
8 (2009) 190 IR 365.
9 (2010) 196 IR 145.
10 Ibid at [17].
11 [2013] FWC 5617.
12 Ibid at [38]; see also Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services
Union of Australia v Jemena Asset Management [2015] FWC 1189 per DP Gostencnik.
13 [2015] FWC 1189.
14 PR952743 [2004] AIRC 1059 op. cit. at [11]
15 [2015] FWC 1189 at [27].
16 [2014] FWCFB 7447.
17 City of Wanneroo v Australian Administrative Clerical and Services Union (2006) 153 IR 426.
18 Amcor Limited v CFMEU and Ors [2005] HCA 10.
19 Short v Hercus (1993) 40 FCR 511 at 518.
20 Ibid.
21 Bond & Co Ltd (in liquidation) v McKenzie (1929) 28 AR 499.
22 Toll FGCT Pty Limited v Alphapham Pty Ltd (2004) 219 CLR 165 (at 179).
23 (1996) 66 IR 182.
24 [2014] FWCFB 7447 at [30].
25 [2015] FWCFB 5619.
26 C2013/5463.
27 QUD596 of 2013.
28 Agreed Statement of Facts – Attachment A.
29 Agreed Statement of Facts – Attachment B.
30 [2004] AIRC 1059.
31 (2009) 190 IR 365.
32 (2010) 196 IR 145.
33 [2013] FWC 5617.
34 [2015] FWC 1189 at [23].
35 Kucks v CSR Limited (1996) 66 IR 182 at 184.
36 [2014] FWC 246.
[2016] FWC 8360
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37 [2015] FWC 1189.
38 [1995] AIRC 1362.
