The Fair Work Commission has held that the concept of “genuinely trying” to reach agreement in the context of enterprise bargaining is not a “moral” test.

The Commission said that in determining whether the parties have genuinely tried to reach agreement, the totality of each party’s actions in the negotiations must be considered, rather than the narrower, moral, question of whether a party has lied, misrepresented or made misleading statements.

In this matter, the union sought protected ballot orders. The Commission accepted that during negotiations, the union had “milked” an error in the employer’s draft enterprise agreement relating to the wages schedule, despite being immediately aware of the error. The Commission also accepted that on a second occasion, the union deliberately acted in a “manipulative” way. The Commission also said that the employer was “rightly aggrieved” by the conduct of the union.

However, the Commission stated that: 

“contextualising the test for genuinely trying to reach agreement in terms of moral notions of lying, misrepresentation or misleading statements is . . . too narrow and focuses upon a moral principles rather than the totality of the [union’s] actions in negotiations.” 

The Commission acknowledged that in some circumstances, deliberate misrepresentation or misleading statements may be contrary to good faith bargaining. However, despite the issues highlighted by the employer in this case, the Commission sxaid that in the totality of the circumstances, the union had, nonetheless, genuinely tried to reach agreement. 

Key points for employers:

  • The conduct of parties to enterprise bargaining will be considered in its totality, rather than by reference to isolated instances of “immoral” conduct by one of the parties. 
  • In this matter, there were only two instances the employer could point to in order to seek to demonstrate that the union was not genuinely trying to reach agreement. If manipulative or dishonest conduct is more pervasive, it may be contrary to good faith bargaining.