In previous editions of Employment Matters we reported on cases where unions argued that employers had failed to comply with the good faith bargaining (GFB) requirements in the Fair Work Act 2009.

Unions were successful in a number of those cases.

But two recent cases illustrate that it is not only employers who are at risk of GFB orders.

In Flinders Operating Services T/A Alinta Energy v ASU and Others [2010] FWA 4821, Alinta Energy applied for GFB orders against four unions, after repeated but unsuccessful attempts by Alinta to progress the negotiations for three new enterprise agreements. The case was decided by Commissioner Hampton.

Firstly, Alinta complained that two of the unions had failed to provide logs of claim despite ample opportunity. Commissioner Hampton observed that the Act does not specifically require parties to state their bargaining positions, but he said that it is “a necessary and important part of the bargaining process”. He agreed that the absence of a clear position from the unions amounted to a failure to disclose relevant information as required by section 228(1)(b).

Alinta’s second complaint was that each union had failed to comply with the requirement in section 228(1)(a) to attend and participate in bargaining meetings at reasonable times. Alinta had set up a schedule of meetings, but the unions had taken issue with Alinta’s agenda, and with Alinta’s views about how many site delegates should be allowed to attend. The unions attended some meetings but boycotted others without prior notice. Commissioner Hampton was not persuaded that there had been a persistent failure by the unions to comply with the GFB requirements, but he was persuaded that the unions had unreasonably failed to attend the last of the scheduled meetings.

Thirdly, Alinta argued that the unions had failed to respond to a draft agreement that it had put forward, in breach of section 228(1)(c) which requires representatives to respond to proposals in a timely manner. One union had written to Alinta, saying that it thought the proposed agreement was “sub standard”, without giving any reasons. Commissioner Hampton agreed that this, together with the union’s continued failure to provide a detailed response, was a breach of the GFB requirements.

Having found that the unions had failed to meet the GFB requirements, Commissioner Hampton then had to consider whether to make any bargaining orders. He noted that the Act required him to be satisfied that it was reasonable in all the circumstances to do so.

Ultimately, he decided to order the unions to:

  •  provide reasons to Alinta for their rejection of Alinta’s proposed agreement, and
  •  attend bargaining meetings as reasonably arranged by Alinta, after discussion between the bargaining representatives, and on reasonable notice.

In another case, ASU v NCR Australia Pty Ltd [2010] FWA 6257, the ASU made application for bargaining orders against NCR after negotiations had stalled and NCR had stated its intention to withdraw from bargaining. Commissioner Cambridge said that the Act does not envisage, even in an apparent stalemate, that one party may unilaterally decide that bargaining has ceased and refuse to participate in any further meetings. Therefore he made an order requiring the employer to participate in meetings. However, he said he appreciated the employer’s level of frustration that had underpinned its decision to withdraw from negotiations, not least the fact that the ASU had revised its wages claim upwards from a 5% per year increase to a 10% per year increase. He considered that to be a failure to comply with the GFB requirements. He therefore decided to make a GFB order against the ASU, directing it to give genuine consideration to the employer’s proposals “and therefore construct any of its proposals without revising its wages claims by increasing previously stated claims”.

These cases demonstrate that the GFB requirements apply to all bargaining representatives, and that FWA will, where appropriate, make orders against either the employer or the employee representatives, or both, to facilitate bargaining.