In its first decision regarding good faith bargaining, Fair Work Australia has ordered an employer to halt a ballot for a proposed enterprise agreement and hold a series of meetings with the union instead. This is an early reminder the new regime requires employers to adopt an appropriate bargaining strategy in relation to enterprise agreement negotiations not only with their employees but also with bargaining representatives.
The decision concerned an urgent application for a bargaining order brought by the Australian Municipal, Administrative, Clerical and Services Union (ASU) which sought to prevent Queensland Tertiary Admissions Centre Limited (QTAC) from holding a ballot of employees to approve a new enterprise agreement. The ASU argued QTAC had contravened various provisions of section 228 of the Fair Work Act 2009 (Cth) (the Act), by failing to meet the good faith bargaining requirements.
In his decision, Senior Deputy President Richards (SDP Richards) of Fair Work Australia, noted that QTAC began negotiating the new enterprise agreement directly with its employees in April of this year. A proposed agreement was then presented by 30 June, however its content was further modified and the final agreement was presented to employees on 22 July. SDP Richards determined that although the agreement was initiated prior to 1 July 2009, the negotiating or bargaining process did not end until after the new good faith bargaining provisions had come into effect.
SDP Richards also noted that from April, QTAC was aware the ASU had an interest in the agreement making process as on 6 May the ASU had served a log of claims on QTAC. Although neither party appeared to take any action to initiate meetings, the ASU claimed it understood QTAC would invite it to meetings. Other than a brief and informal meeting held on 7 July between ASU and QTAC, the bargaining process took place between QTAC and its employees directly.
In SDP Richard's view, it was "apparent that QTAC excluded the ASU from meetings and discussions about the proposed enterprise agreement" and by doing so, contravened the good faith bargaining requirements under the Act.
In addition, Fair Work Australia noted that, in accordance with the Act, the ASU had provided QTAC with a notice appointing it as a bargaining representative on 10 July and that bargaining between QTAC and its employees continued beyond this date. SDP Richards determined QTAC did not recognise the ASU as a bargaining representative over the course of discussions and meetings in July, when it was apparent the ASU had representative standing. SDP Richards held that QTAC's failure to recognise and bargain with other bargaining representatives amounted to a further contravention of the good faith bargaining requirements under the Act.
As a result, QTAC was prevented from conducting its agreement ballot with employees and was ordered to schedule four meetings with the ASU over a two week period.
The decision highlights that Fair Work Australia is prepared to actively manage the good faith bargaining process by exercising its powers under the good faith bargaining provisions. Employers who are not strategic in their negotiations will leave themselves open to intervention by Fair Work Australia.