In brief

  • As a general rule, FWA has resisted strong ‘invitations’ by unions to intervene in the bargaining process to regulate unilateral decisions taken by employers in furtherance of their bargaining agenda.
  • The exceptions have been where employers have overstepped the mark and engaged in tactics considered to be ‘illegitimate’ by reference to the recognised role of the bargaining representative within the collective bargaining regime.
  • Employers can take some heart from the guidance provided by FWA decisions on the limited circumstances warranting intervention in the bargaining process where unions complain about direct engagement with the workforce.  


The new bargaining regime introduced by the ALP’s ‘Forward with Fairness’ reforms brought with it challenges and opportunities for all bargaining participants. However, it was feared that employers with non-unionised workplace arrangements or employment models underpinned by direct employee engagement strategies would face the greatest challenges due to the ability of employees (through their appointed bargaining representatives) to force employers into bargaining and through the regulation of the bargaining process by ‘bargaining orders’.

This article focuses on recent cases involving applications for bargaining orders and their impact on elements of direct employee engagement strategies during the bargaining process.

Bargaining orders: what are they?

Bargaining orders can be granted by FWA where:

  • a bargaining representative is not bargaining in good faith, or
  • bargaining is not proceeding efficiently or fairly because there are multiple bargaining representatives for the agreement.

A bargaining representative for an agreement can apply for a bargaining order provided specific procedural requirements are followed. These relate principally to the other bargaining representatives being given written notice of the relevant concerns and a reasonable timeframe to respond to those concerns.

The nature of the orders which might be made appear to be broad in compass. Although bargaining orders cannot require concessions to be made in the course of bargaining or force a party into an agreement, they can be used to correct behaviour which is viewed as contrary to the good faith bargaining requirements or which otherwise impedes the efficient or fair progress of negotiations. To date, unions have demonstrated a much greater enthusiasm for pursuing bargaining orders than employers. The reasons for this are varied, but there is a increasing trend of unions seeking to interfere with unilateral decisions by employers during bargaining through applications for bargaining orders.

The early days

The new bargaining regime became effective from 1 July 2009. Not surprisingly, some bargaining participants were caught out by the new regulatory environment in the initial phases. Many of the early cases involving bargaining orders concerned union applications to prevent an employee vote to approve an agreement under negotiation. The cases generally involved an allegation of bargaining representatives being ‘bypassed’ by employers or that the vote was being conducted at a time when bargaining had not been exhausted.

As a general rule, FWA was prepared to intervene in these circumstances and order that the planned vote not proceed. This was not an indefinite prohibition. The relevant orders focused on the further process for bargaining before a vote of employees could be legitimately undertaken in the absence of agreement reached with appointed bargaining representatives.

As bargaining participants became more familiar with the new regime, the focus of the cases has quickly turned to ‘tactics’ during the bargaining process. This might have arisen as a result of many negotiations becoming quite protracted and the difficulties that bargaining participants were generally finding in reaching an agreement. Bargaining orders are a lever in negotiations and it is clear that sophisticated bargaining participants believe that strategic advantages can be gained from pursuing bargaining orders that further their negotiating agendas. If nothing else, a bargaining order made against an employer can have a significant impact on the way in which employees view the negotiation and the inevitable posturing that occurs between an employer and union bargaining representative.

The current state of play

There is little doubt that the good faith bargaining obligations prevent bargaining representatives from being bypassed in negotiations. This has, to some extent, called into question the capacity of an employer to communicate directly with their employees during bargaining or to unilaterally decide on a course of action which may have an impact on the bargaining process.

Again, not surprisingly, these issues have been agitated in recent times before FWA. This follows attempts by unions, in particular, to rely on the good faith bargaining requirements to regulate employer conduct which involves direct communication with employees in order to control or regulate the communication flow.

The starting point appears to be that FWA will be slow to interfere in the legitimate tactics undertaken by parties during the bargaining process unless an applicant for a bargaining order has demonstrated that there are sound reasons for doing so.1

The leading recent case on bargaining orders is the Full Bench decision in Tahmoor Coal.2 The negotiations in that case were variously described as ‘long and torturous’ and ‘vigorous and often acrimonious’. The CFMEU alleged that the employer had engaged in unfair or capricious conduct which undermined collective bargaining. They sought broad orders to correct the offending behaviour, which was constituted variously by having discussions about the proposed agreement with employees in the absence of their bargaining representatives, disseminating information to employees about the proposed agreement (including written communications to their homes) and proceeding to conduct a vote on the proposed agreement without the consent of the bargaining representatives.

On appeal, the Full Bench upheld the decision at first instance that the employer had not offended the good faith bargaining requirements. Importantly, the Full Bench made clear that any alleged failure to observe the good faith bargaining requirements needed to be determined in light of all relevant circumstances and that the issue will rarely be decided by reference to one action or series of actions. In this case, the lengthy period of negotiation assisted the employer in defending its right to communicate directly with their employees and to seek to influence their views in support of a positive vote on the proposed agreement. In contrast to other decisions, the Full Bench did not need to find that negotiations had reached an ‘impasse’. Significantly, the materials used in the communication process and the messages delivered in employee meetings were not considered to be ‘deceptive or otherwise objectionable’. As a result, the Full Bench was able to find that employees were not being mislead or otherwise pressured into a particular outcome.

Having regard to all relevant circumstances, the Full Bench endorsed the right of the employer to communicate directly with its employees and to put its proposed agreement to a ballot to see if progress could be made.

When is the line of ‘legitimacy’ crossed?

The outcome in Tahmoor Coal should be contrasted with the factual circumstances confronting FWA in the CBA case3 and Murray Bridge.4 In both these cases FWA found that intervention in the bargaining process was warranted by reference to a breach by the employer of the good faith bargaining requirements.

In the CBA case, the union complained about the employer’s conduct in granting unilateral pay increases to staff whilst it was negotiating for an agreement. Commissioner Smith concluded that this ‘approach can be viewed as undermining collective bargaining’. This followed in the Commissioner’s view from the employer adopting a different position on their wages proposal when dealing with employees through their bargaining representatives, as opposed to the manner in which they approached this issue outside of bargaining (and with employees directly). Importantly, FWA’s intervention stopped short of requiring the employer to decide on the particular wages proposal and ‘put it on the table’ during bargaining. The bargaining orders required the employer to notify bargaining representatives within 24 hours of deciding to implement any wage increase and to provide them with 14 days to respond before any increase is implemented or communicated to employees.

In Murray Bridge, the AMIEU complained that the employer was not bargaining in good faith due to its insistence to conduct negotiations through a joint consultative committee (JCC) and secondly, through its failure to respond or give genuine consideration to the union’s proposals. Commissioner Hampton considered that it was appropriate, reasonable and convenient to use the JCC as a negotiating vehicle, and this of itself did not mean that the negotiating process adopted by the employer was lacking in good faith. However, on the evidence, the Commissioner did find that the employer’s responses to the union’s claims were ‘dismissive and very general’, and on that basis was satisfied that the employer had not been bargaining in good faith. Orders were issued delaying the employee vote to enable further good faith bargaining steps to be undertaken.

Perhaps the clearest statement on the legitimacy of direct employee dealings or communications during bargaining was made by Vice President Watson in Mingara Recreation.5 The Vice President’s comments pre-dated the Tahmoor Coal ruling and therefore need to be assessed in this light, but do nevertheless provide some guidance as to the place of direct employee communications in the new bargaining regime:

‘In my view, communicating with staff is good management practice. If such communications are not accompanied by a refusal to meet and communicate with a bargaining representative, then in my view there is no breach of the good faith bargaining requirements of the Act.

The obligations under the Act relate to genuine recognition and genuine bargaining activities with other bargaining representatives. They do not preclude concurrent communication and discussions with employees who may be requested to approve the agreement. In my view, an employer is free to meet with its employees to discuss employment issues, including matters relevant to enterprise bargaining in the absence of bargaining representatives. Widespread communication is to be encouraged – not regulated, diminished or monopolised.’