[2013] FWC 1250

[2013] FWC 1250

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FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.229 - Application for a bargaining order

"Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU)
V
Ridders Fresh Pty Ltd T/A Tibaldi Smallgoods
(B2013/645)

Australasian Meat Industry Employees' Union, The-Victorian Branch
v
Ridders Fresh Pty Ltd T/A Tibaldi Smallgoods
(B2013/653)

COMMISSIONER ROE

MELBOURNE, 27 FEBRUARY 2013

Applications for bargaining orders.

[1] On 18 February 2013 the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) made an application in B2013/645 for a bargaining Order. On 20 February 2013 The Australasian Meat Industry Employees Union (AMIEU) made an application in B2013/653 for a bargaining Order. The applications were made pursuant to section 229 of the Fair Work Act 2009 (the Act). The applications named as the respondent Ridders Fresh Pty Ltd T/A Tibaldi Smallgoods (the Respondent or Tibaldi). At the conclusion of the hearing on 21 February 2013 I dismissed the application by the AMIEU and I issued good faith bargaining orders in respect to the application by the AMWU. Those Orders delayed a ballot on a proposed agreement, which was to have been held that day, for a period of two weeks. I now publish the reasons for my decision.

[2] Given the urgency of the matter I listed the AMWU matter for hearing on 19 February 2013. I heard some initial submissions and then agreed to the adjournment request of the Respondent as the Operations Manager, Mr Roach, was in New Zealand. The matter was then heard on 21 February 2013 together with the AMIEU application which had been lodged the previous evening.

Consideration of the evidence.

[3] The Respondent and some of its employees are covered by the Ridders Fresh Certified Agreement (the Agreement) which was certified in August 2005 and which has a nominal expiry date of 4 August 2008. That Agreement in Clause 3.2 is binding on the Respondent and “all of its Employees working in the Levels and Positions described in this Agreement”. Clause 2 defines Level as the levels set out in Clause 6.2 and Positions as the positions set out in Clause 6.1. Clause 6.1 lists a number of specific positions including “maintenance manager” but no other maintenance employee. Clause 6.2 relates to “employees engaged in Production/Dispatch” and the level descriptions include operators but not specialist maintenance employees.

[4] I am satisfied that the current Agreement does not cover maintenance workers apart from the maintenance manager. I am also satisfied that the Manufacturing and Associated Industries and Occupations Award 2010 (the Award) applies to the maintenance employees of the Respondent. Approximately 240 employees are covered by the Agreement and there are six maintenance employees covered by the Award. The employer believes that approximately 46 of the employees are members of the AMIEU. 1

[5] The Respondent issued a notice of representation rights to employees, including maintenance employees, in late August 2013. The AMIEU issued a log of claims on 20 September 2012. Apart from the AMIEU there were no other bargaining representatives appointed or known to the Respondent. There were negotiation meetings on 19 October 2012, 22 October 2012, 20 November 2012, 31 January 2013, and 11 February 2013.

[6] A draft Tibaldi (Clayton) Enterprise Agreement 2012 (the Draft Agreement) was issued by the Respondent to employees and the AMIEU on 13 February 2012. 2 On that day the Respondent also distributed to employees a notice “Agreement Update”3 which advised that the “company proposes holding a vote on site...by way of a show of hands by eligible employees at 1.30pm on Thursday 21 February 2013”. The notice stated that “the proposed Agreement has been in negotiation with both the AMIEU and employee representatives since October 2012 and is now at a stage where we believe staff should be entitled to vote on the matter.” The notice encouraged employees to vote in favour of the agreement and stated that “there are three options open to us: 1) do nothing and the current agreement will remain in place; 2) transfer to the meat industry modern award; 3) adopt the proposed agreement.” Also distributed at the same time as the notice and the Draft Agreement was a document entitled Agreement Update4 which compared the AMIEU claim in respect to a number of matters with the “Ridders Fresh Offer”. The document identified those matters which had been agreed between the AMIEU and the Respondent during the negotiations and the nature of the difference between the parties on other matters. It should be noted that the Meat Industry Award 2010 does not cover maintenance tradespersons.

[7] On 13 February 2013 there were four meetings held. Two meetings were held with the morning shift. At one of them the Respondent argued in support of its position and at the other the AMIEU reported back to members. There were two similar meetings held on the afternoon shift. I am satisfied by the evidence of Mr Jones that the AMIEU had not been advised that the Respondent was going to organise its own meetings on 13 February 2013. The AMIEU meetings were organised and approved at the bargaining meeting on 11 February 2013. Mr Roach gave evidence that after the morning meeting the AMIEU advised the Respondent that it believed that there should be a secret ballot not a show of hands. Mr Roach said that he agreed with this and advised the afternoon shift meeting accordingly. Mr Roach said that there was no notice issued correcting the “Agreement Update” notice issued to all employees. 5

[8] Mr Roach gave evidence that some corrections were made to the Draft Agreement to ensure it reflected the Agreement Update comparison table or summary. The Agreement Update stated that there was agreement that the AMIEU would be a party to the agreement and that there would be certain arrangements in respect to notice for annual leave and these were not reflected in the Draft Agreement. Mr Roach said that a new document was issued to employees from the morning of 14 February 2013 which is titled Tibaldi (Clayton) Enterprise Agreement 2103 (the Proposed Agreement). 6 That document did include annual leave and agreement parties consistent with the Agreement Update. Mr Jones gave evidence that the matter of payroll deduction of union dues was agreed between the parties even though the Agreement Update did not state this and the Draft Agreement and the Proposed Agreement do not include this provision. I am not able to determine that there was an agreement between the parties on this matter.

[9] I am satisfied that it is reasonably apparent that those on afternoon shift could not have received the Proposed Agreement document until the afternoon of 14 February 2013 which is less than seven days prior to the proposed ballot on the Proposed Agreement. Mr Roach did not provide the AMIEU or the AMWU with a copy of this document and did not advise them that a different document had been issued. Mr Roach gave evidence that it is the Proposed Agreement which is to be the subject of the proposed ballot on 21 February 2013.

[10] The AMIEU argued that during the course of the negotiations for the Proposed Agreement the Respondent had agreed to include classifications for packing and dicing lines, for bandsaw operators and for forklift operators. At the 11 February 2013 bargaining meeting Mr Jones and some of the other delegates present noticed that the draft agreement did not include these classifications and that they were not included in the indicative tasks that corresponded to a particular pay grade. 7 Mr Jones gave evidence that Mr Roach agreed that these tasks would be added to the document before it was distributed to employees. The AMIEU regard it as a breach of good faith bargaining that these matters were not included in the document circulated for the vote. Mr Jones gave evidence that a document which linked the classification levels with various tasks was developed in consultation with employees.8 Mr Roach agrees that this occurred. However, Mr Roach gave evidence that he understood that the AMIEU was seeking assurance that the tasks were covered by the classifications and he understood that the document demonstrated how the tasks linked to the classifications. He did not understand that the document was to be incorporated into the agreement document.

[11] Having considered the evidence on this point I accept that Mr Jones believed that Mr Roach had agreed to include the link between the tasks and the classifications in the agreement, however, I consider it likely that Mr Roach misunderstood this and felt that he was complying with the understanding reached in producing a separate document which showed how the tasks were covered by the classification structure.

[12] I accept that the update notice does not include the option of voting no and continuing negotiations. The AMIEU argue that this is misleading and unfair and undermining of collective bargaining. However, in a situation where the AMIEU have access to put their case during the lead up to the agreement vote I do not consider this would justify the making of a good faith bargaining order. A similar situation applies to the AMIEU complaint about the lack of advice about the voting date and the failure to provide the union with a copy of the Proposed Agreement.

[13] Mr Roach says that at the meeting on 31 January 2013 the parties agreed that negotiations had reached a stalemate and that the company should put the proposed agreement to a vote. Mr Roach says that at a further meeting on 11 February 2013 the materials to be distributed were finalised and it was agreed that the materials would be distributed on 13 February 2013 and that a vote would be conducted at 1.30pm on 21 February 2013. 9 In cross examination Mr Roach was less definitive about the exact time and date for the vote having been discussed and agreed on at the 11 February 2013 meetings. Mr Jones accepted that a stalemate had been reached in negotiations on some major items and that it was acknowledged that it was close to a position where it was accepted that the position of the employees would be tested in a vote. However, Mr Jones says that there was a further negotiation meeting on 11 February 2013 which progressed some matters further and that the date, time and method of voting was not agreed or canvassed at the meeting on 11 February 2013. Mr Jones gave evidence that he expected that the document would be available to the AMIEU for checking before going out to employees and that there would be discussion about voting time and method. This did not occur and the Respondent issued the documents on 13 February 2013.

[14] Having considered the evidence of Mr Roach, Mr Jones and Mr Chirgwin from the AMWU I found the evidence of Mr Jones to be the most convincing and consistent on this point. I am satisfied that at the meeting of 31 January 2013 the parties accepted that a stalemate had been reached on some key items such as wages and that at some time in the reasonably near future the issues would be tested by a vote of employees. I am satisfied that a further negotiation meeting took place on 11 February 2013 which led to some changes to the positions of the parties. I am satisfied that it was accepted at the meeting on 11 February 2013 that a vote would be held in the near future and that AMIEU meetings would be held on 13 February 2013 to update and consult with employees. I am also satisfied that at the meeting on 11 February 2013 the actual time and date for voting and the method of voting was neither canvassed nor agreed.

[15] On 7 February 2013 two documents were sent to Mr Roach. The AMWU organisers served a right of entry notice 10 and the “maintenance team” emailed Mr Roach as follows: “Subject: Agreement Negotiations: Hi Nick, please be advised that the Maintenance Team has sought representation from the AMWU in regards to the new Workplace Agreement.”11

[16] Mr Chirgwin gave evidence that membership forms were distributed on 8 February 2013 and that a meeting was held on site on 11 February 2013. Mr Chirgwin gave evidence that three maintenance employees signed the relevant forms to join the union and for direct debit for payment of dues on 11 February 2013 and another two maintenance employees did so on 13 February and 15 February respectively. Mr Chirgwin gave evidence that he provided the forms to the AMWU Victorian State office membership department for processing and he produced a membership print out 12 which demonstrates that five maintenance employees are recorded as members at the Respondent and that at least one of those members has paid dues. Mr Chirgwin said that as an organiser he is provided with a similar document in respect to each of the workplaces for which he is responsible on a monthly basis.

[17] Mr Follett for the Respondent argued that Rule 42 Membership of the AMWU Rules requires that the State Secretary must where appropriate allocate the person to an appropriate division and must place the new member on the roll of members and must forward an account for dues owing. It is apparent from the Rules that maintenance employees are not allocated to a division and I am satisfied that it can be inferred from the membership print out that the necessary steps to place the member on the roll have been completed. I am satisfied that from 11 February 2013 the AMWU had members employed at the Respondent. I am satisfied that the AMWU Rules enable it to enrol as members the maintenance employees of the Respondent. I am also satisfied that from 7 February 2013 employees put the Respondent on notice that they wished the AMWU to represent them in negotiations for a new Workplace Agreement.

[18] Mr Follett argues that the email of 7 February 2013 is not an instrument of appointment of the AMWU as a bargaining representative for the maintenance employees pursuant to Section 178 of the Act. Mr Follett referred to the FWA Full Bench decision in Kaizen Hospitals v ANF 13 and the following passage in particular:

“Having regard to the abovementioned provisions, it is clear that the Act adopts prescriptive and formal requirements for the appointment of bargaining representatives and that the power of a bargaining representative to represent the employer in negotiations for an enterprise agreement arises from the instrument of appointment. It is fundamental to the exercise of power by a bargaining representative that the appointment has been validly made.

In the present appeals, it is evident that SIAG was not appointed as a bargaining representative for the Companies in accordance with the Act. There was no instrument of appointment or other written document or any other evidence produced in the appeal proceedings to show that SIAG had been appointed as the employer bargaining representative for the Agreements. It must therefore be concluded that SIAG was not a duly appointed bargaining representative of the Companies.” 14

[19] Mr Follett argues that in this case such an instrument would be a notice from the employees to the AMWU a copy of which is provided to the employer rather than a notice from the employees to the employer. I suspect that in the circumstances of this case where there is evidence that the AMWU was aware of the wishes of the employees and in fact facilitated the email being sent that this is an overly technical reading of the requirements. However, it is not necessary to determine this point. As from 11 February 2013 the AMWU is a bargaining representative for its maintenance members employed by the Respondent. The email of 7 February 2013 when combined with the discussions between Mr Chirgwin, Mr Childs (a maintenance employee who had been involved in the earlier negotiation meetings for the agreement) and Mr Roach on 11 February 2013 is sufficient to establish that the Respondent knew that the AMWU was a bargaining representative on and from 11 February 2013.

[20] At the meeting on 11 February 2013 Mr Chirgwin and Mr Childs suggested that the maintenance employees were not covered by the present Agreement and suggested that they might be covered by a separate agreement in the future. It was agreed at that meeting that Mr Chirgwin would return for further discussions on 15 February 2013. Mr Roach says that he understood this would involve a meeting with him and then a discussion with maintenance employees whereas Mr Chirgwin understood this would involve a short meeting with employees and then a meeting with Mr Roach. Mr Roach says that Mr Chirgwin said that he might have a log of claims by then. Mr Roach says that he told Mr Chirgwin that “Ridders had already decided to go to a vote on the agreement on 21 February 2013”.

[21] On 15 February 2013 Mr Chirgwin returned to the site and had a short meeting with employees before having a meeting with Mr Roach together with Mr Childs. Mr Roach says that at that meeting Mr Chirgwin was unhappy about the proposal that the proposed agreement was to go to a vote on 21 February 2013. Mr Roach says that Mr Chirgwin said that the maintenance employees should be covered by the Manufacturing Award and that he was considering seeking a scope order. Mr Roach says that Mr Chirgwin had a log of claims with him which he waved around but did not provide to Mr Roach. Mr Chirgwin says that the first that he was aware of the proposal to put the matter to a vote on 21 February was when the members told him about it when he arrived on site on 15 February 2013. Mr Chirgwin says that at the 15 February 2013 meeting Mr Roach made it clear that the Respondent would not agree to a stand alone agreement for maintenance employees and that it was therefore too late for a log of claims.

[22] I consider that the behaviour of Mr Chirgwin is not consistent with him having been told by Mr Roach on 11 February 2013 that the proposed agreement would be going to a vote on 21 February 2013. It would have been largely pointless to arrange a meeting on 15 February 2013 if this were the case. I also prefer the evidence of Mr Chirgwin that the arrangement for 15 February 2013 was that Mr Chirgwin would have a short meeting with employees and then a meeting concerning the maintenance employees claims in respect to a new agreement would be held with Mr Roach. This is in fact what occurred. I am satisfied that Mr Chirgwin made it clear to Mr Roach on 11 February 2013 that the maintenance employees were not happy with the outcome of negotiations to date in respect to a new agreement and were seeking discussions about a separate agreement and also about a stronger linkage to the provisions of the Award. I am satisfied that Mr Roach understood that a log of claims would be prepared and would be available for the discussions on 15 February 2013. I am satisfied that the actions of the Respondent in providing employees with the Proposed Agreement and in advising that there would be a vote in respect to that document on 21 February 2013 was directly inconsistent with the understanding reached on 11 February 2013 that there would be a meeting with the AMWU as a representative of maintenance employees concerning a new agreement as it affected those employees who were members.

[23] Mr Roach gave evidence that Mr Chirgwin did not provide him with the log of claims, did not seek further discussions, did not specifically seek to delay the vote, and did not put in writing the particular concerns with the Proposed Agreement. I am satisfied that Mr Chirgwin understood that a meeting had been arranged for discussions about an agreement as it affected maintenance employees on 15 February 2013 and that it was reasonable for Mr Chirgwin to understand that this meeting had the character of a bargaining meeting. However, I am satisfied that the actions of the Respondent in circulating the Proposed Agreement and the voting date prior to that meeting rendered that meeting and further documentation of concerns at that stage pointless as the Proposed Agreement could not be changed without a decision to delay the vote. The Respondent by its actions made it clear that would not occur.

[24] Mr Follett argued that negotiations had proceeded for five and a half months and that it is totally unreasonable for a bargaining representative to expect a vote to be delayed in circumstances where the issues are raised at the last minute. Mr Follett argues that it was open to the maintenance employees to raise these issues at the start of the process. In its own “Agreement Update” 15 issued on 13 February 2013 the Respondent says that negotiations have proceeded since October 2012 that is a period of four not five and a half months. I have found that the maintenance employees were not covered by the current Agreement. The proposal to include the maintenance employees is a significant change.

[25] The Proposed Agreement includes a classification for maintenance employees which was not included in the current Agreement. Mr Roach agrees that Mr Childs raised concerns in negotiations about the relationship between the Award conditions and the agreement under negotiation. Mr Roach suggests that Mr Childs said that provided that employees were better off overall when compared to the Award it would be OK. The Proposed Agreement does not appear to contain any of the conditions specific to the Award. Mr Chirgwin referred to matters such as the classification and career path structure (only one classification level is included in the Proposed Agreement) and the absence of the provisions in respect to overtime and call back from the Award. Mr Chirgwin gave evidence that the maintenance workers had been concerned to preserve the Award conditions throughout the bargaining. Mr Jones gave evidence that Mr Childs on behalf of maintenance workers was seeking the inclusion of the relevant provisions of the Award in any proposed agreement. I accept this evidence. It is consistent with the events that followed. Mr Roach says that Mr Childs said that “as long as the terms of the new agreement matched the terms of the Manufacturing Award, then the maintenance employees would be satisfied.” 16 I do not accept Mr Roach’s interpretation of this as meaning that so long as the BOOT was met this would be acceptable. The Draft Agreement and the Proposed Agreement produced by the Respondent in 2013 do not match the terms of the Manufacturing Award in a number of significant respects.

[26] There is no evidence to suggest that employees would have been aware of what the outcome of negotiations in respect to maintenance employees was likely to be until at least the meeting of 31 January 2013. At that meeting the AMIEU accepts that it was clear that the position of the Respondent was firming up and that time was fast approaching when the Respondent was intending to put a document out for consideration and then a vote. Mr Childs was the maintenance employee who had been present at the negotiations. Mr Jones says Mr Childs was not present at the 31 January 2013 and 11 February 2013 meetings. Mr Roach is not sure if Mr Childs was present at the 31 January 2013 meeting. I consider it probable that he was not at the 31 January 2013 meeting.

[27] The time period of the negotiations was not so long and the number of meetings was not so great that it would have been apparent to employees what the final position of the employer was likely to be. There is no reason why maintenance employees would have any sense of urgency to seek stronger representation in the early stages of the negotiations.

[28] I am satisfied that it was not unreasonable or capricious for maintenance employees to seek to join the AMWU so that the AMWU could be their bargaining representative in order to protect their position in any proposed new agreement only after negotiations had occurred on four separate dates.

[29] An examination of the Proposed Agreement when compared to the existing instrument governing maintenance workers of the Respondent, the Award, shows that there are a number of significant conditions which are inferior to the Award. There are also matters such as rates of pay which are superior to the Award. The issue as to whether or not the Proposed Agreement would pass the Better Off Overall Test is not a relevant consideration at this stage. I make no comment on this matter. I am simply observing that the impact of the Proposed Agreement on the maintenance workers is significantly different from the impact on the production workers given that the maintenance workers are currently subject to the Award.

[30] I accept the evidence of Mr Roach that Mr Chirgwin advised him that he was considering a scope order at the meeting on Friday 15 February 2013 but that Mr Chirgwin and the AMWU took no action to achieve a scope order prior to that date. The AMWU made the Application for a good faith bargaining order promptly on the next working day, Monday 18 February 2013. On Wednesday 20 February 2013 the AMWU advised the Respondent in writing that it was seeking a scope order and sought a response.

[31] I am satisfied that the AMWU was not aware of the proposed ballot in respect to the Proposed Agreement until 15 February 2013. The members of the AMWU would have been aware on 13 or 14 February 2013. I am therefore satisfied that the AMWU made its application for a good faith bargaining order at the earliest practical opportunity. Given that the ballot was proposed for 21 February 2013 it would have been impractical for the AMWU to delay making an application to FWC until after it had sought to correspond directly with the employer concerning the issue.

[32] I am satisfied that the AMIEU was first aware of the date of the proposed ballot in respect to the Proposed Agreement on 13 February 2013 and was aware that the Proposed Agreement did not include the classifications and tasks it believed had been agreed to be included on 14 or 15 February 2013. The AMIEU made its application on 20 February 2013. In the particular circumstances of this case I am satisfied that it would have been difficult but not impractical for the AMIEU to directly raise its concerns with the Respondent concerning the failure to include the classifications and tasks it believed had been agreed to be included and to advise that they believed this to be a breach of good faith bargaining prior to making the application late on 20 February 2013.

Legislation

[33] The relevant provisions of the legislation are as follows:

“228 Bargaining representatives must meet the good faith bargaining requirements

(1) The following are the good faith bargaining requirements that a bargaining representative for a proposed enterprise agreement must meet:

(a) attending, and participating in, meetings at reasonable times;

(b) disclosing relevant information (other than confidential or commercially sensitive information) in a timely manner;

(d) giving genuine consideration to the proposals of other bargaining representatives for the agreement, and giving reasons for the bargaining representative’s responses to those proposals;

(e) refraining from capricious or unfair conduct that undermines freedom of association or collective bargaining;

(f) recognising and bargaining with the other bargaining representatives for the agreement.

(2) The good faith bargaining requirements do not require:

(a) a bargaining representative to make concessions during bargaining for the agreement; or

(b) a bargaining representative to reach agreement on the terms that are to be included in the agreement.

229 Applications for bargaining orders

Persons who may apply for a bargaining order

(1) A bargaining representative for a proposed enterprise agreement may apply to the FWC for an order (a bargaining order) under section 230 in relation to the agreement.

Multi-enterprise agreements

(2) An application for a bargaining order must not be made in relation to a proposed multi-enterprise agreement unless a low-paid authorisation is in operation in relation to the agreement.

Timing of applications

(3) The application may only be made at whichever of the following times applies:

(a) if one or more enterprise agreements apply to an employee, or employees, who will be covered by the proposed enterprise agreement:

(i) not more than 90 days before the nominal expiry date of the enterprise agreement, or the latest nominal expiry date of those enterprise agreements (as the case may be); or

(ii) after an employer that will be covered by the proposed enterprise agreement has requested under subsection 181(1) that employees approve the agreement, but before the agreement is so approved;

(b) otherwise—at any time.

Note: An employer cannot request employees to approve the agreement under subsection 181(1) until 21 days after the last notice of employee representational rights is given.

Prerequisites for making an application

(4) The bargaining representative may only apply for the bargaining order if the bargaining representative:

(a) has concerns that:

(i) one or more of the bargaining representatives for the agreement have not met, or are not meeting, the good faith bargaining requirements; or

(ii) the bargaining process is not proceeding efficiently or fairly because there are multiple bargaining representatives for the agreement; and

(b) has given a written notice setting out those concerns to the relevant bargaining representatives; and

(d) considers that the relevant bargaining representatives have not responded appropriately to those concerns.

Non-compliance with notice requirements may be permitted

(5) The FWC may consider the application even if it does not comply with paragraph (4)(b) or (c) if the FWC is satisfied that it is appropriate in all the circumstances to do so.

230 When the FWC may make a bargaining order

Bargaining orders

(1) The FWC may make a bargaining order under this section in relation to a proposed enterprise agreement if:

(a) an application for the order has been made; and

(b) the requirements of this section are met in relation to the agreement; and

Agreement to bargain or certain instruments in operation

(2) The FWC must be satisfied in all cases that one of the following applies:

(a) the employer or employers have agreed to bargain, or have initiated bargaining, for the agreement;

(b) a majority support determination in relation to the agreement is in operation;

(d) all of the employers are specified in a low-paid authorisation that is in operation in relation to the agreement.

Good faith bargaining requirements not met

(3) The FWC must in all cases be satisfied:

(a) that:

(i) one or more of the relevant bargaining representatives for the agreement have not met, or are not meeting, the good faith bargaining requirements; or

(ii) the bargaining process is not proceeding efficiently or fairly because there are multiple bargaining representatives for the agreement; and

(b) that the applicant has complied with the requirements of subsection 229(4) (which deals with notifying relevant bargaining representatives of concerns), unless subsection 229(5) permitted the applicant to make the application without complying with those requirements.

Bargaining order must be in accordance with section 231

(4) The bargaining order must be in accordance with section 231 (which deals with what a bargaining order must specify).

231 What a bargaining order must specify

(1) A bargaining order in relation to a proposed enterprise agreement must specify all or any of the following:

(a) the actions to be taken by, and requirements imposed upon, the bargaining representatives for the agreement, for the purpose of ensuring that they meet the good faith bargaining requirements;

(b) requirements imposed upon those bargaining representatives not to take action that would constitute capricious or unfair conduct that undermines freedom of association or collective bargaining;

(c) the actions to be taken by those bargaining representatives to deal with the effects of such capricious or unfair conduct;

(d) such matters, actions or requirements as the FWC considers appropriate, taking into account subparagraph 230(3)(a)(ii) (which deals with multiple bargaining representatives), for the purpose of promoting the efficient or fair conduct of bargaining for the agreement.

(2) The kinds of bargaining orders that the FWC may make in relation to a proposed enterprise agreement include the following:

(a) an order excluding a bargaining representative for the agreement from bargaining;

(b) an order requiring some or all of the bargaining representatives of the employees who will be covered by the agreement to meet and appoint one of the bargaining representatives to represent the bargaining representatives in bargaining;

(c) an order that an employer not terminate the employment of an employee, if the termination would constitute, or relate to, a failure by a bargaining representative to meet the good faith bargaining requirement referred to in paragraph 228(1)(e) (which deals with capricious or unfair conduct that undermines freedom of association or collective bargaining);

(d) an order to reinstate an employee whose employment has been terminated if the termination constitutes, or relates to, a failure by a bargaining representative to meet the good faith bargaining requirement referred to in paragraph 228(1)(e) (which deals with capricious or unfair conduct that undermines freedom of association or collective bargaining).

(3) The regulations may:

(a) specify the factors the FWC may or must take into account in deciding whether or not to make a bargaining order for reinstatement of an employee; and

(b) provide for the FWC to take action and make orders in connection with, and to deal with matters relating to, a bargaining order of that kind.”

Conclusions

[34] I am satisfied for the reasons outlined earlier that the AMIEU and the AMWU are bargaining representatives for the proposed agreement (S.229(1)). The Applications have been made “after an employer that will be covered by the proposed enterprise agreement has requested under subsection 181(1) that employees approve the agreement, but before the agreement is so approved.” The Applications meet the requirements of S.229(3).

[35] I am satisfied that the AMIEU and the AMWU have concerns that good faith bargaining requirements have not been met and S.229(4)(a) is satisfied. The AMIEU and the AMWU have not complied with S.229(4)(b) and (c). For the reasons discussed earlier I am satisfied that it is appropriate in all of the circumstances to waive the requirement in this respect pursuant to S.229(5) in respect to the AMWU application but not in respect to the AMIEU application. Even if I am wrong in respect to the AMIEU application I do not consider that the breach of good faith bargaining requirements in respect to the AMIEU is sufficiently serious to warrant the exercise of discretion to make a good faith bargaining order. In that respect I specifically refer to my finding that I consider it likely that Mr Roach misunderstood the understanding reached in respect to the inclusion in the Proposed Agreement of certain classifications and tasks. I consider that the AMWU had made the nature of its concerns that the maintenance employees were not adequately provided for in the Proposed Agreement particularly in respect to Award conditions known to the Respondent and that the AMWU considers that the response to those concerns by proceeding with a ballot on the Proposed Agreement to be inadequate. S. 229(4)(d) is met in respect to the AMWU.

[36] The requirements of S.230(1)(a) and (b) have been met. The requirements of S.230(2) have been met in that the Respondent has agreed to bargain and has initiated bargaining for an agreement.

[37] I cannot make an order in respect to the AMIEU because I have found that the conditions in S. 230(3)(b) have not been met. However, I have found that they have been met in respect to the AMWU.

[38] In respect to S.230(3) I am satisfied that the Respondent has not met the good faith bargaining requirements in respect to the AMWU as a bargaining representative for maintenance employees. I consider the Respondent’s decision to advise employees that it would put the Proposed Agreement to a vote on 21 February 2013 prior to meeting with the AMWU and considering and responding to its claims to be of particular relevance in a situation where:

● The Respondent was aware that the Proposed Agreement could not be altered during the period between 14 February 2013 and 21 February 2013.
● The maintenance employees advised the Respondent that they wished the AMWU to represent them in bargaining for a new agreement and the Respondent was aware that the AMWU was a bargaining representative on and from about 11 February 2013.
● The Respondent agreed to meet with the AMWU on behalf of its members on 15 February 2013 to discuss concerns and proposals about a new agreement.
● Prior to that meeting the Respondent advised employees on 13 and 14 February 2013 that the vote on the Proposed Agreement would occur on 21 February 2013.
● I am satisfied that the Respondent did not advise the AMWU of its intention to put the Proposed Agreement to a vote on 21 February 2013 prior to the meeting on 15 February 2013 and did not advise the AMWU members prior to 13 and 14 February 2013.

[39] In the particular circumstances of this case I regard this conduct to be capricious and unfair in that it was directly inconsistent with the reasonable understanding the AMWU and its members had concerning the meeting on 15 February 2013. I regard the conduct as also undermining freedom of association and collective bargaining. It undermines freedom of association in that it undermines the capacity of the employees to be effectively represented by a union with coverage of their work. It undermines collective bargaining in that the scheme of the Act encourages collective bargaining and the making of agreements and the role of bargaining representatives in that process and the actions of the Respondent denied the bargaining representative an effective role in that process. There has been a breach of S.228(e).

[40] The conduct of the Respondent was also inconsistent with the requirement to recognise and to bargain with the AMWU as a bargaining representative (S.228(f)). The conduct of the Respondent effectively denied the AMWU recognition and it effectively denied any real opportunity for bargaining. The conduct of the Respondent has meant that genuine consideration could not be given to proposals of the AMWU on behalf of its members.

[41] However, I do not find that there has been a breach of S.228(d) in that it is arguable that the formed proposals of the AMWU were not able to be effectively put to the Respondent. It is arguable that the failure to schedule negotiation meetings including the AMWU prior to circulation of the Proposed Agreement and advice as to a vote constitutes a breach of S.228(a). This is consistent with the approach taken by Commissioner Whelan in NUW v Defries Industries Pty Ltd 17. It is not necessary to determine this question. I do not accept the argument of the AMWU that there has been a breach of S.228(b) or (c).

[42] S.230(3)(a)(i) is satisfied because I am satisfied that there has been a breach of S.228(e) and (f).

[43] Mr Follett argues that I should not exercise my discretion to issue a good faith bargaining order. S.230(1)(c) provides that I can only issue an order if I am satisfied that it is reasonable in all of the circumstances to make the order. Mr Follett correctly points out that there will be circumstances where a bargaining representative is appointed too late or raises concerns too late and where it would be unreasonable, having regard to the interests of the other parties, to delay a process to enable the concerns or proposals of a minority to be properly considered and responded to.

[44] This was an issue to which I gave careful consideration. Mr Roach describes the benefits to employees of the Proposed Agreement. He says that: “the wages schedule in the proposed agreement are slightly higher than the present minimum pay rates.” 18 There is no evidence of any clamour by bargaining representatives or other employees for the Proposed Agreement to go to a vote. The only evidence is from bargaining representatives who want the vote delayed. The AMIEU on the Respondent’s own evidence represents a significant minority of those who will be covered by the Proposed Agreement and were the only bargaining representative for the Proposed Agreement. There were other employees involved in negotiation meetings but there was no evidence of their views apart from the views of Mr Childs who it can be inferred supports the AMWU.

[45] I am unable to conclude that there will be significant disadvantage to other employees or bargaining representatives if an order was to be made which delayed the vote for a short period. I am unable to conclude that there would be significant operational or commercial disadvantage to the Respondent. There is no evidence of any protected industrial action. I accept that the granting of orders would affect the relative bargaining positions of the parties. However, this is an inevitable consequence of the making of bargaining orders in most circumstances. I do not consider that the affect on the relative bargaining positions of the parties of an order for a short delay will be particularly great particularly given that any bargaining order cannot require the Respondent to include a matter in an agreement or to make any particular concession.

[46] I am satisfied that it is reasonable in all the circumstances to make an order.

[47] The AMWU seeks an Order that:

“1. The Respondent refrain from holding a vote of employees for the Tibaldi (Clayton) Enterprise Agreement 2012 (the Proposed Agreement) until the AMWU has submitted a log of claims and the parties have at least two meetings.

2. The Respondent refrain from holding a vote of employees for the Proposed Agreement until the AMWU has applied for and a determination given in relation to a Scope Order pursuant to section 238 of the Fair Work Act 2009.”

[48] I am concerned at the length of the delay which could result from any requirement for a scope order application to be dealt with prior to any vote. If the issue had arisen earlier in the bargaining process then I would not have these concerns. However, in this situation Mr Jones for the AMIEU accepted that an impasse has been reached on significant issues. There is no suggestion that proposals raised by the AMIEU in bargaining had not been considered, responded to and been the subject of negotiation. In this situation I consider that it would be unreasonable to deny the employer the right to put its position to the test for an indefinite period of time.

[49] I accept that the AMWU on behalf of its members may be justifiably concerned that the interests of 5 mechanical maintenance employees could be swamped by the votes of more than 200 production employees. However, there are many agreements where maintenance employees are in the same agreement as production employees and their particular classifications and interests are accommodated. The central breach of good faith bargaining has been the failure to meet with the AMWU as planned to consider and respond to its proposals. In the circumstances of this case I do not consider that it is appropriate to delay the ballot in order to allow the AMWU to make a scope order application and for that application to be finalised. A bargaining party is able under the Act to make an application for a scope order in certain circumstances but generally it is a matter for that bargaining party to organise any application at the appropriate time in the appropriate manner. There is no specific obligation on another bargaining party to facilitate such an application. There may be circumstances where the effective denial of the ability to make a scope order may be a relevant consideration in the making of a good faith bargaining order. However, in the circumstances of this case I do not consider that the order should provide for a delay linked to consideration of a scope order application which has been foreshadowed but not yet made.

[50] At the time I made my decision I advised the parties that the Fair Work Commission does not require the AMWU or the Respondent to make any concession or to alter any bargaining position, however, given that the FWC has declined to order that the ballot be delayed until a scope order is determined the parties may wish to consider the appropriate provisions as they affect maintenance employees in the Proposed Agreement and not just the matter of the scope of the agreement.

[51] I consider that the fair balance of interests in this case is for the order to address the particular breach that has been found. I consider that it is appropriate that there be two further bargaining meetings in the next week. This will enable proper consideration to any proposals of the AMWU on behalf of its members concerning the adequacy of the Proposed Agreement as it affects maintenance workers. There then needs to be a further week of delay so that it is possible to incorporate in the Proposed Agreement any changes which might result from that bargaining process including any changes to the scope of the agreement and give employees the required seven days notice of the proposed agreement and the voting arrangements.

[52] Such an order would ensure that the Respondent meets the good faith bargaining requirement to recognise bargaining representatives and to meet and respond to proposals from a bargaining representative. It would also ensure that the Respondent takes the appropriate action to deal with the effects of the specific capricious and unfair conduct that I have identified. This is consistent with the requirements of S.231 of the Act.

[53] For these reasons I ordered that:

1. The Respondent refrain from holding a vote of employees for the proposed Agreement until 8 March 2013.

2. Prior to 28 February 2013 there be two further bargaining meetings including the AMWU as a representative of its members and the other bargaining representatives as they may be affected by the outcomes of the meetings. The AMWU also be provided with the opportunity to consult with those whom it represents prior to each of those meetings. The purpose of the meetings is to enable proper consideration of and responses to the provisions of an Agreement as they affect maintenance employees represented by the AMWU.

3. FWC does not consider it appropriate in the circumstances to grant an order to require that a vote proposed by the Respondent be delayed beyond 8 March 2013 to enable the finalisation of any application for a scope order which may be made by the AMWU.

[54] The consequential Orders were issued separately on 21 February 2013 [PR534318] and operate in accordance with Section 232 of the Act.

COMMISSIONER

Appearances:

Ms J Maloney appeared for the AMWU and the AMIEU.

Mr M Follett represented the Respondent.

Hearing details:

2013

Melbourne

February 21

1 Exhibit Ridders 1 at paragraph 5.

2 Exhibit Unions 6.

3 Exhibit Unions 1.

4 Exhibit Unions 4.

5 Exhibit Unions 1.

6 Exhibit Ridders 1, Attachment NR5.

7 Exhibit Unions 3 at paragraphs 13 and 14.

8 Exhibit Unions 7.

9 Exhibit Ridders 1 at paragraph 24.

10 Exhibit Ridders 1, Attachment NR 3.

11 Exhibit Ridders 1, Attachment NR 4.

12 Exhibit Unions 5 - Confidential.

13 [2012] FWAFB 8866.

14 [2012] FWAFB 8866 at paragraph 13 and 14.

15 Exhibit Unions 1.

16 Exhibit Ridders 1 at paragraph 13.

17 [2009] FWA 88.

18 Exhibit Ridders 1 at paragraph 44.

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