Fair Work Australia has made its first good faith Bargaining Order under the Fair Work Act 2009 (the Act) requiring the employer, the Queensland Tertiary Admissions Centre Limited (QTACL), to cease to conduct a ballot for a replacement enterprise agreement and to require QTACL to bargain with the Australian Services Union (ASU).

What do employers need to do?

  • Employers need to ensure that they understand their obligations in relation to bargaining representatives and good faith bargaining
  • Employers should develop a bargaining strategy that includes managing their relationships with unions and other bargaining representatives and consultation with employees

What is good faith bargaining

Good faith bargaining is a new requirement contained in the Act, with the obligation to bargain in good faith starting on 1 July 2009.

An employee, who will be covered by an enterprise agreement, is entitled to appoint a bargaining representative. If an employee is a union member,that union will be the default bargaining representative of the employee unless the employee appoints some other person.

The Act states that “bargaining representatives” must comply with a range of good faith bargaining requirements in relation to agreement making, which are:

  • Attending and participating in meetings at reasonable times
  • Disclosing relevant information (other than confidential or commercially sensitive information) in a timely manner
  • Responding to proposals made by other bargaining representatives in a timely manner
  • 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, and
  • Refraining from capricious or unfair conduct that undermines freedom of association or collective bargaining.

Good faith bargaining obligations are mutual and apply to the employer, a union party, or an individual who an employee has appointed as their representative.

Where a party is not bargaining in good faith a Bargaining Order can be made by Fair Work Australia.

The Queensland Tertiary Admissions Centre Limited decision

The QTACL decision is a significant decision for employers because it has clarified that an employer is likely to have an obligation to meet good faith bargaining obligations even where bargaining commenced prior to 1 July 2009.

Senior Deputy President Richards did, however, leave the door open for employers, saying that Fair Work Australia may exercise some discretion on this point depending on the maturity of pre Fair Work Act negotiations:

“The Act does not appear to preserve any negotiating process commenced prior to 1 July 2009, though arguably it may be a matter for FWA’s discretion at s.230(1)(c) of the Act whether any orders might be made in circumstances where negotiations reached a marked level of maturity by the commencement date of the legislation”.

The QTACL decision is also significant because it has indicated the breadth of Orders which can follow making a successful application to Fair Work Australia for a Bargaining Order.

In this case the application was made to Fair Work Australia the day before a ballot was to commence for the making of a replacement enterprise agreement by QTACL.

His Honour accepted that QTACL had excluded the ASU from meetings at a time when the agreement content was not fixed or immutable as this was a breach of good faith bargaining requirements. In addition the QTAC did not recognise the ASU as a bargaining representative over the course of the discussions and meetings in July 2009 at the time when it was apparent the ASU had such representative standing.

In addition, because of the urgency of the application resulting from a proposed ballot starting the following day, His Honour exercised his discretion not to require that the ASU comply with the notification provisions under section 229(4)(b), (c) and (d) that:

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

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

(c) has given the relevant bargaining representatives a reasonable time within which to respond to those concerns; and

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

The order made by Senior Deputy President Richards included:

  • Requiring that the ballot on the following day not be undertaken
  • Requiring the ASU and QTAC to hold four meetings over following two weeks with the duration of those meetings to be determined by the bargaining representatives, and
  • Further orders can be sought for meetings but only if there is appropriate evidence that QTAC and the ASU have been unable to reach agreement on the same, and that such meetings are not for capricious purposes but have a real and apparent prospect for achieving an agreement.