[2011] FWAFB 6551

Download Word Document


FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.604—Appeal of decision

Technip Oceania Pty Ltd
v
W. Tracey
(C2011/4957)

JUSTICE GIUDICE, PRESIDENT
SENIOR DEPUTY PRESIDENT DRAKE
COMMISSIONER BLAIR

MELBOURNE, 7 NOVEMBER 2011

DECISION OF JUSTICE GIUDICE AND COMMISSIONER BLAIR

Introduction

[1] This is an appeal, for which permission is required, by Technip Oceania Pty Ltd (the appellant) against a decision and an order made by Commissioner Cloghan on 13 June 2011. 1 In the decision the Commissioner granted an application by Mr W. Tracey under s.229 of the Fair Work Act 2009 (the Act) for a good faith bargaining order. He issued an order under ss.230 and 231 implementing the decision on the same day.

[2] Mr Follett of counsel appeared on behalf of the appellant, Mr Ritter of senior counsel on behalf of Mr Tracey and Mr Ridley appeared for an intervener, the Chamber of Commerce and Industry Western Australia.

[3] It will be necessary to go into the background to the proceedings in more detail later in this decision. At this stage it is sufficient to note that the appellant is engaged in the offshore oil and gas industry and employs operators of sub-sea work vehicles, known as remotely operated vehicles (ROVs). There is an enterprise agreement applying to the operators. 2 The agreement expired on 27 July 2011. The appellant wished to commence bargaining for a new agreement and, on 11 March 2011, issued a notice of employee representational rights to the operators pursuant to s.173 of the Act. Around the middle of April 2011 a number of the operators executed instruments appointing Mr Tracey as their bargaining representative for the purpose of bargaining in relation to the new enterprise agreement. Mr Tracey is an official of the Western Australian Branch of the Maritime Union of Australia (MUA). The appellant refused to recognise Mr Tracey as a bargaining representative. On 6 May 2011 Mr Tracey served a notice on the appellant pursuant to s.299(4) of the Act in which he set out his concern at the appellant’s refusal to recognise him. On 11 May 2011 the appellant reiterated its refusal to recognise Mr Tracey. On the next day, 12 May 2011, Mr Tracey lodged an application under s.229 seeking a good faith bargaining order. Relevantly, the order would require the appellant to recognise Mr Tracey as the bargaining representative for the operators.

The legislation

[4] Before dealing with the Commissioner’s decision it is necessary to refer to some elements of the legislative scheme. Division 3 of Part 2-4 of the Act is entitled “Bargaining and representation during bargaining”. It contains a number of relevant provisions. Section 173 requires an employer that will be covered by a proposed enterprise agreement to give the relevant employees a notice of employee representational rights. Section 174 prescribes the content of the notice. Relevantly the notice must specify that the employees may appoint a bargaining representative for the purposes of bargaining for the proposed agreement. Section 178(1) provides that the appointment of a bargaining representative comes into force on the day specified in the instrument of appointment.

[5] For the purpose of this appeal, s.176(3) is of particular importance. It reads:

[6] This provision is a significant qualification on the right of an employee to appoint a bargaining representative. An employee may only appoint an organisation as their bargaining representative if the organisation is entitled to represent the employee’s industrial interests. It is common ground that the MUA is not entitled to represent the industrial interests of ROV operators.

[7] There are other important provisions in Division 8 of Part 2-4 of the Act. That Division is entitled “FWA’s general role in facilitating bargaining”. Section 228 sets out the good faith bargaining requirements which bargaining representatives must meet. The requirements include a requirement to recognise and bargain with the other bargaining representatives for the agreement. 3 Section 231 provides for a number of types of bargaining order. One of those is an order specifying the actions to be taken by bargaining representatives for the purpose of ensuring they meet the good faith bargaining requirements. Section 230 says when a bargaining order can be made. The relevant parts of s.230 are as follows:

[8] It can be seen that s.230(1) sets out three conditions for the making of a bargaining order. The first condition is that an application has been made. The second condition is that the requirements of the section are met in relation to the agreement. For the purposes of this appeal the relevant requirement of the section is that in s.230(3)(a)(i), namely: that a bargaining representative is not meeting the good faith bargaining requirements. It is not necessary to set those requirements out in full. As we have already noted, one requirement is to recognise and bargain with other bargaining representatives. (It is common ground that the appellant refused to recognise and bargain with Mr Tracey.) The third condition for making an order is in s.230(1)(c). That section requires Fair Work Australia to be satisfied that it is reasonable in all the circumstances to make the order.

The decision

[9] In the proceedings before the Commissioner the appellant opposed Mr Tracey’s application. It relied on the fact that Mr Tracey is the Assistant Secretary of the Maritime Union of Australia (MUA), Western Australian Branch. It contended that Mr Tracey was not acting as a bargaining representative in a personal capacity but as an official of the MUA, contrary to the requirement in s.176(3) of the Act.

[10] The Commissioner decided to grant the application. He found that, subject to the terms of reg.2.06 of the Fair Work Regulations 2009 and s.176(3) of the Act, employees may appoint whom they wish as their bargaining representative. While accepting that as a matter of law an organisation may not be a bargaining agent for an employee for whom it does not have constitutional coverage, and the MUA does not have constitutional coverage for ROV operators, he nevertheless found no impediment to Mr Tracey’s appointment as a bargaining representative in an individual capacity.

The evidence

[11] We turn now to the evidence before the Commissioner. The hearing proceeded on the basis of a statement of agreed facts. That statement incorporated by reference some documents, apparently distributed by Mr Tracey, relevant to the negotiations, as well as a number of items of correspondence passing between Mr Tracey and the appellant. We deal first with the documents distributed by Mr Tracey.

[12] The first document is headed: “The Maritime Union of Australia, West Australian Branch.” Immediately under this heading a number of officials are listed. The list includes Mr W Tracey, who is described as the Assistant Branch Secretary, and five other officials. Immediately below this is another heading which reads: “MUA ROV Newsletter”. There are various contact details at the foot of the document. The address, phone number, facsimile number and email address are those of the MUA. The fifth paragraph of the newsletter reads:

[13] The penultimate paragraph of the newsletter reads:

[14] Attached to the newsletter is a separate document headed “MUA ROV Log of Claims - 2011” This document contains a long list of items, presumably for negotiation. The last sentence of the document reads: “If anyone has any other queries then please contact Will Tracey on any of the contact details in the email that had this update flyer attached to it.” As indicated, all of those contact details referred to are those of the MUA.

[15] We turn now to some of the correspondence between the parties. There are a number of emails from Mr Tracey. The emails have common features. The signature block is in the following form:

[16] It is common ground that the North Fremantle address is that of the MUA. Immediately under the signature block are a mobile phone number, a telephone number and a facsimile number. It appears to be accepted that the mobile phone number is for a phone provided by the MUA to Mr Tracey and that the other two numbers are MUA office numbers. There is also an email address which has the domain name “MUA”. Under the email address the distinctive logo of the MUA appears.

[17] The first of the emails in evidence was sent by Mr Tracey to the appellant on 18 April 2011. It attached a number of bargaining representative appointment forms and sought discussions as the bargaining representative for the operators. A copy of the email was sent to the members of the MUA Western Australian Branch Executive. On the next day, 19 April 2011, the Australian Mines and Metals Association (AMMA), acting on behalf of the appellant, responded to Mr Tracey in an email addressed to him at the MUA domain. In the email it was indicated that the appellant would not recognise Mr Tracey as the operators’ bargaining representative because the MUA is precluded from being a bargaining representative by the terms of s.176(3) of the Act. It included the following sentence:

[18] On 21 April 2011 Mr Tracey sent an email to AMMA asserting that he had been appointed the bargaining representative (and by necessary inference not the MUA) and again requested the appellant to recognise him as a bargaining representative under the Act.

[19] On 26 April 2011 Mr Tracey sent a further email to the appellant. Included was a log of claims in similar if not identical form to the one already described. The email included the statement that “the log is being formally served by myself .... as the nominated bargaining representative under section 176(1)(c) of the Fair Work Act.” Mr Tracey again sought discussions on behalf of the operators in relation to a new agreement.

[20] Mr Tracey emailed the appellant twice on 6 May 2011. In the first email he formally raised his concern that the appellant would not recognise him as a bargaining representative and indicated that if the appellant did not recognised him within 5 days he would make an application to Fair Work Australia for bargaining orders. In the second email Mr Tracey again sought discussions on behalf of ROV operators.

The arguments on appeal

[21] Counsel for the appellant submitted that there was no valid application before the Commissioner. The grounds of appeal advanced rested solely on the terms of s.230(1)(a). There were two grounds. The first ground was that the employees had not appointed Mr Tracey as their bargaining representative in his personal capacity but in the capacity of an official of the MUA. Because the MUA does not have constitutional coverage of ROV operators, the MUA is prevented by s.176(3) from being their bargaining representative. The second ground on which it was contended that there was no valid application was that Mr Tracey had made the application for bargaining orders in his capacity as an official of the MUA. Because the MUA does not have relevant constitutional coverage, the application is therefore not a valid one.

[22] It is important to point out that the case put on appeal does not mirror the case put to the Commissioner. In opening his case before the Commissioner Mr Cameron, who appeared for AMMA on behalf of the appellant, said:

[23] So framed, the submission raised the question whether Mr Tracey was acting in a personal capacity or as an MUA official. Other submissions made by Mr Cameron, however, suggest that the argument was not put solely on the basis that there was no valid application.

For example, Mr Cameron submitted that it would not be reasonable to make the order sought. In doing so he referred to a decision in which an application for a bargaining order had been refused on that basis. 5 Considerations of reasonableness are not relevant under s.230(1)(a). They are relevant under s.230(1)(c). Mr Cameron also made some other submissions which are more appropriate to the exercise of the discretion in s.230(1)(c) than to the question posed by s.230(1)(a).6 We return to the grounds of appeal and to our conclusions.

Conclusions

[24] The first ground of appeal is that the operators had appointed the MUA as their bargaining representative and not Mr Tracey. This ground constitutes a challenge to the validity of the instruments of appointment. It is clear beyond doubt that the instruments of appointment are in favour of Mr Tracey and do not appoint the MUA. There is no cogent evidence the operators intended to appoint the MUA as their bargaining representative. On the material there is no reason to go behind the instruments of appointment. In our view this ground cannot succeed.

[25] The second ground of appeal is that the application for a bargaining order was not made by Mr Tracey in a personal capacity but as an official of the MUA. It is not clear that the argument was put to the Commissioner in the precise terms that it was put on the appeal. Perhaps that is why the Commissioner did not deal with the point directly. Nevertheless, there being no objection to the ground of appeal, it is appropriate that we deal with it on its merits.

[26] We have outlined the documentary evidence earlier. That material is bristling with indications that, in his dealings with the appellant, Mr Tracey was acting as an official of the MUA. Although the emails are all written in the first person, the signature block, address, contact details and use of the union logo, all strongly suggest that Mr Tracey was acting in his capacity of Assistant Secretary of the MUA’s Western Australian Branch. The newsletter and log of claims also contain unmistakable indications that Mr Tracey’s advocacy for ROV operators was inextricably linked to the MUA. It is a fair inference from the material that at the relevant times Mr Tracey was operating from the MUA’s premises and using the MUA’s resources. The terms of the application under s.229, which have not so far been referred to, point in the same direction. While on its face the application is made by Mr Tracey as an individual, and there is no reference to the MUA or to Mr Tracey’s union office, the address and contact details are those of the MUA. When taken with the other documentary material the only conclusion available is that in making the application Mr Tracey was not acting in a personal capacity but in the capacity of an MUA official.

[27] Counsel for Mr Tracey sought to put some reliance on the fact that in its email letter of 19 April 2011, AMMA indicated that the appellant acknowledged that some of the operators thought of Mr Tracey as their representative and that the appellant might decide to have discussions with him about the proposed enterprise agreement. This sentence seems to us to be nothing more than an indication that the appellant might choose to have discussions with Mr Tracey even though he was not a bargaining representative under the Act. In context, it is not a concession that Mr Tracey was acting in a personal capacity.

[28] In light of the documentary material, and in the absence of any cogent countervailing evidence, the inference should be drawn that in making the application Mr Tracey was acting as an official of the MUA. Because the MUA is incapable of representing the industrial interests of the ROV operators the application was invalid. For that reason the Commissioner’s decision was wrong and the appeal must be upheld.

[29] As we have endeavoured to show earlier in this decision, the submissions made on the appellant’s behalf before the Commissioner included discretionary considerations relevant to s.230(1)(c). The Commissioner was therefore obliged to consider whether he was satisfied that it would be reasonable in the circumstances to make the order. Given our conclusion that at the relevant times Mr Tracey was acting in the capacity of an MUA official, there was a basis for a conclusion that it would not be reasonable to grant the application. Both counsel, however, approached the appeal on the basis that no reliance had been placed upon s.230(1)(c) before the Commissioner. For that reason it would not be appropriate to express a concluded view in relation to the requirement in s.230(1)(c).

[30] We have decided to grant permission to appeal, to uphold the appeal and to quash the decision and orders of 13 June 2011.

PRESIDENT

DECISION OF SENIOR DEPUTY PRESIDENT DRAKE

[31] Justice Giudice and Commissioner Blair have made two findings. Firstly, they rejected the appellant’s ground of appeal that the operators had appointed the MUA as their bargaining representative and not Mr Tracey. They found that:

[32] I agree with that finding.

[33] Secondly, in dealing with the appellant’s ground of appeal that the application for a bargaining order was not made by Mr Tracey in his personal capacity but as an official of the MUA, the majority have found that:

[34] The majority base this finding on the documentary material evidencing the MUA’s activities, which material included Mr Tracey’s activities as the relevant officer, in agitating for an agreement for the operators. Regarding this evidence, which they have summarised, they have concluded:

[35] I cannot agree that the evidence is “bristling with indications” that support the inference drawn by the majority or the conclusion highlighted above or that there is an absence of any cogent countervailing evidence.

[36] The history of organisational activity in this area is relevant. There is no suggestion of a demarcation dispute. The organisation with coverage of the operators, the Australian Marine Officer’s Union (AMOU), was silent. It did not oppose the application for an order. It had not been nominated as a bargaining representative by any employee and did not seek to be involved in bargaining. If the prevention of the encroachment of one organisation into the area of coverage of another organisation, with consequent disputation, is a matter which should be considered when deciding whether or not the issue of a bargaining order is reasonable, the circumstances surrounding this application would not give rise to any such concern. Against the absence of the other relevant organisation the MUA, although it does not have coverage, has been outspoken in the pursuit of a log of claims for operators. Mr Tracey is the contact person at the MUA for any operator who wants the MUA to represent them.

[37] ROV operators are not the only employees concerning whose work the MUA does not have coverage but on whose behalf it is very active. Mr Tracey is also contemporaneously active as a bargaining representative for such employees in his individual capacity. As an example, in a recent decision 10 and order11 Mr Tracey was confirmed in his individual capacity as the bargaining representative for various employees bargaining with the Fremantle Port Authority. There was no objection on the basis that the MUA and not Mr Tracey was the real applicant. Deputy President McCarthy commented:

[38] Employees are entitled to seek out the person they perceive is the most qualified to negotiate on their behalf, someone who they see as interested in their affairs, someone who has the skills and runs on the board. An individual who is an officer in an organisation which is agitating for an agreement, whether or not that organisation has coverage, is likely to be attractive to these employees for appointment as a bargaining representative. It is clear, and the appellant accepts, that some operators wished Mr Tracey to be their bargaining representative.

[39] It is consistent with authority that employees can be represented by bargaining representatives who are employed or are officers of organisations. I consider it to be significant that officers of organisations which do not have coverage have not been excluded from the pool of available bargaining representatives when it would have been easy for them to be excluded. The Act says “a person” not “a person except a person who is an officer or employee of an organisation which does not have coverage.” A few short words inserted into s.176(3) would have been effective if it had been the legislature’s intention to exclude them.

[40] It is not uncommon for organisations to enter into agency arrangements whereby officials of another organisation represent their members in negotiations by consent. This does not mean that the bargaining representative involved in negotiations is acting in his or her organisation’s interest rather than acting as a bargaining representative for the relevant member. In some applications before Fair Work Australia the arrangements in this application have been the means of formalising that arrangement in a manner not prohibited by the Act.

[41] The Full Bench has considered whether, when Mr Tracey made this application he was Mr Will Tracey, bargaining representative who was also an officer of the MUA, or whether he was acting as the MUA under the guise of Mr Will Tracey the individual.

[42] This matter has to be determined on the evidence. All of the evidence relied on by the majority to support its conclusion focuses on what the MUA, and Mr Tracey as its official, were doing. It is clear that the MUA was seeking support for a log of claims for these operators.

[43] With respect, this conclusion does not take into account or give proper weight to what Mr Tracey was doing in his individual capacity as a bargaining representative. In all of Mr Tracey’s communications he confirmed his status as an individual acting as a bargaining representative. The direct evidence of Mr Tracey’s actions and the substance of his correspondence confirm his intention to act as an individual bargaining representative. I consider it unsafe to set that evidence aside in favour of inferences to be drawn from the evidence of the MUA’s campaign. These inferences should not outweigh the direct evidence of Mr Tracey’s own statements and communications. This is particularly so when they are supported by the clearly expressed intention of the operators to appoint Mr Tracey as their bargaining representative, in circumstances where they are entitled to choose him and have properly appointed him, and when, by doing so, they have demonstrated that they were able to distinguish between his dual roles. To refuse to allow Mr Tracey to secure bargaining orders risks precluding efficient and effective representation of employees on the basis of subjective inferences.

[44] Commissioner Cloghan dealt with the failure of Mr Tracey to separate, in the formal parts of his communications, Mr Tracey as an individual and Mr Tracey as an officer of the MUA. Mr Tracey used the MUA’s letterhead, email contact and telephone contact. The fact is that Mr Tracey would have been damned if he did correspond separately and has been damned because he did not. This was dealt with by Commissioner Cloghan as follows:

[45] The majority has decided that, in the application before Commissioner Cloghan, Mr Tracey was the MUA. I do not agree. The majority has relied on the evidence concerning what the MUA had done and from that has concluded that Mr Tracey was acting as the MUA when he made the application for orders.

[46] I am persuaded that one must first look at what Mr Tracey did as an individual acting as a bargaining representative and weigh that evidence. I do not consider that Mr Tracey’s assertions can or should be set aside because the organisation he works for, and of which he is an officer, is similarly agitating for agreement. The fact that the appellant does not want to bargain with the MUA does not entitle it to refuse to bargain with an individual properly appointed, despite that individual’s employment by an organisation to which they are not attracted. The Act says “a person” not “a person whose background is acceptable to the employer.”

[47] Commissioner Cloghan understood Mr Edmond’s submission on behalf of Mr Tracey was that Mr Tracey was acting as an individual. The Commissioner considered the duality of Mr Tracey’s roles and distinguished them. He did not conclude that Mr Tracey was the MUA in the application before him. That was a factual issue squarely before the Commissioner for his determination and Commissioner Cloghan’s order should not be set aside by Members on appeal who have formed a different view of the evidence.

[48] Mr Tracey is an MUA official who, in his individual capacity, has been properly appointed as a bargaining representative. It was necessary for Mr Tracey to seek a bargaining order to do what was necessary for the employees who had appointed him and I am not persuaded that there is any error in Commissioner Cloghan’s decision to grant it. Commissioner Cloghan accepted the statements of Mr Tracey contained in his correspondence and his findings should not be set aside. It was reasonable in all the circumstances for Commissioner Cloghan to make the Order.

SENIOR DEPUTY PRESIDENT

Appearances:

M Follett of counsel for Technip Oceania Pty Ltd.

M Ritter SC for Mr W. Tracey.

J Ridley for the Chamber of Commerce and Industry Western Australia.

Hearing details:

2011.
Perth.
September, 15.

 1   [2011] FWA 3509, PR510445.

 2   ROV Casual Employee Collective Agreement 2009 (AC327296).

 3   s.228(1)(f).

 4   PN208.

 5   PN214 - 219; and see Heath v Gravity Crane Services Pty Ltd [[2010] FWA 7751] at paras 39 and 40.

 6   See PN237 and PN244.

 7   Majority decision paragraph [24].

 8   Majority decision paragraph [28].

 9   Majority decision paragraph [26].

 10   William Warren Tracey v Fremantle Port Authority [2011] FWA 6746.

 11   PR515131.

 12   William Warren Tracey v Fremantle Port Authority [2011] FWA 6746.

 13   William Tracey v Technip Oceania Pty Ltd [2011] FWA 3509.

Printed by authority of the Commonwealth Government Printer

<Price code C, PR514922>