Two recent decisions of Fair Work Commission (FWC) Full Benches highlight a number of features of the framework for collective bargaining and protected industrial action under theFair Work Act 2009 (Cth) (FW Act).

GOOD FAITH BARGAINING AND THE REQUIREMENT TO “MEET”

In LCR Mining Group Pty Ltd v CFMEU [2016] FWCFB 400 (4 February 2016), the Full Bench considered an appeal by the company against a decision and bargaining orders made by Commissioner Saunders.[1]

The parties had met in person a number of times to progress negotiations for an enterprise agreement, but then could not agree on where and how future meetings should occur. The company wanted to conduct future meetings by teleconference or videoconference, while the union wanted to continue to meet face-to-face at the Newcastle airport.

Commissioner Saunders granted the union’s application for bargaining orders, finding that the requirement in section 228(1)(a) of the FW Act to attend and participate in meetings at reasonable times: “requires the participants in the meeting to be present in person”.[2]

On appeal, the Full Bench (Catanzariti VP, Sams DP and Roberts C) took a different view, largely on the basis that in the modern context meetings often occur other than in person:

In the digital age of an ever-advancing civilisation, technology has and will continue to evolve at a rapid pace. The rise of information systems and the development of collaborative technologies have brought manifold efficiencies including an abundance of new methods by which distance is overcome and ‘meetings of the mind’ may be facilitated.[3]

According to the Full Bench, a “meeting of the minds” (as opposed to a “meeting of the bodies”) could occur “regardless of the specific technologies utilised in facilitating such a meeting”.[4]

Further, “a narrow and restrictive interpretation” of section 228(1)(a) – disallowing the option of meetings by phone or video – would introduce words into the provision (a requirement to meet face-to-face) which are not there.[5]

The Full Bench rejected the union’s argument that the broader meaning of the word “attend” (meetings) in section 228(1)(a) “would open floodgates to persons insisting on teleconference or videoconference being the modus operandi for bargaining meetings”. The Full Bench noted that “these facilities have been in use for years in the bargaining process alongside face to face meetings” – but added the caution that this “is not to say that every telephone conversation or videoconference will constitute a meeting” for the purposes of the provision.[6]

The decision therefore permits employers to insist that bargaining negotiations are conducted in the manner that is most efficient for the business. Particularly for larger employers with operations in a number of states, it would be legitimate to hold meetings by phone or video. But employers should also:

  • consider whether such meetings could reasonably be supplemented with some face-to-face meetings; and
  • remember that section 228(1) does actually entail an obligation to meet (through whatever method), rather than simply responding to a union’s claims or counter-proposals through written correspondence.[7]

SUSPENSION OF PROTECTED INDUSTRIAL ACTION FOR A “COOLING OFF” PERIOD

MUA v Patrick Stevedores Holdings Pty Ltd [2016] FWCFB 711 (8 February 2016) dealt with an appeal against a decision by Vice President Watson to grant the company’s application to suspend the union’s industrial action under section 425 of the FW Act.[8]

The parties have been negotiating since March 2015 over a new agreement for Patrick’s port operations at Brisbane, Port Botany, Melbourne and Fremantle. While some progress had been made, including through the assistance of Deputy President Booth of the FWC, in late 2015 the union obtained secret ballot authorisation for various forms of protected industrial action.

Bans, stoppages and other forms of action commenced on 6 January 2016, and continued on the 18th and 19th with further action proposed for 25-27 January. In the meantime Patrick applied to the FWC for a section 425 order suspending the union’s industrial action for a 60-day period.

Section 425(1) provides that the FWC must make an order suspending protected action that is being engaged in, if the Commission is satisfied that a suspension is appropriate taking into account:

  • (a) whether the suspension would be beneficial to the bargaining representatives because it would assist them to resolve matters at issue in the negotiations;
  • (b) the duration of the industrial action;
  • (c) whether suspension would be contrary to the public interest or inconsistent with the objects of the FW Act;
  • (d) any other relevant matter.

Watson VP considered that the industrial action taken by the MUA “reflects a deterioration in the negotiation process”; and that a suspension of protected action would assist the parties, provided it enabled “proper discussion and consideration of revised positions and for the parties to access the assistance of Deputy President Booth”.[9] Watson VP made an order suspending protected industrial action for 35 days.

However, the Full Bench (Hatcher VP, Catanzariti VP and Bull DP) upheld the union’s appeal, finding that Watson VP’s decision involved an error of fact “as to whether suspension would be beneficial to the bargaining representatives” within the meaning of section 425(1)(a).[10]

The Full Bench considered that the Vice President had reached an incorrect factual conclusion that the elevation of hostilities between the parties had precluded discussion and negotiation.[11] The Full Bench’s reasons for reaching this view included that:[12]

  • Patrick had not (as Watson VP found) cancelled negotiation meetings in mid-January, but had simply proposed that they be rescheduled to ensure Booth DP could be involved.
  • Rather than an elevation of hostilities, high-level discussions between the parties had continued (including at a meeting on 22 January).
  • The parties had agreed on a process to allow discussions to continue to occur over the MUA’s proposed settlement document, even though industrial action was continuing.
  • Relevant managers were not precluded from attending bargaining meetings once industrial action was taking place.

The Full Bench upheld the union’s appeal, and decided to re-hear and determine the company’s section 425 application itself. In the meantime, it appears that something of a cooling-off has in fact transpired following the orders of Watson VP - although the union and workers are free to continue taking protected action, the parties have resumed talks before Booth DP.[13]

It should also be noted that although it found in the union’s favour on the appeal, the Full Bench rejected the MUA’s argument that the suspension order made by Watson VP was invalid because it did not identify the particular industrial action being engaged in, and which was the subject of suspension.[14]

In reaching that view, the Full Bench found that a suspension order under section 425 is not limited to the protected action being engaged in at the time the order is made. Read in conjunction with section 413(7), a section 425 order has the effect of suspending allindustrial action on the part of the relevant union/employees.[15] As the Full Bench put it:

If a suspension order was confined in its effect to a particular type of protected industrial action taken at a particular time, that would imply that other types of protected industrial action could be taken during the cooling off period established by the order. That would appear likely to frustrate the objective of the provision …[16]

Overall, the Full Bench’s decision highlights that clear evidence will need to be provided in support of an employer’s application for a “cooling off” period under section 425 of the FW Act. It sets a high bar for the evidence that will be required to substantiate the employer’s argument that a suspension of protected action will assist the parties to reach an agreement.