[2010] FWA 5819

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FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.236 - Application for a majority support determination

The Australian Workers' Union
v
The Austral Brick Co Pty Ltd T/A Austral Bricks
(B2010/409)

COMMISSIONER HAMPTON

ADELAIDE, 11 AUGUST 2010

Majority support determination - individual transitional instruments applicable to many employees - whether group defined fairly - petition - non eligible employees included on petition - meaning and explanation of petition in issue - whether evidence sufficient to demonstrate that a majority of eligible employees want to bargain with the employer.

Background

[1] This matter concerns an application lodged by the Australian Workers’ Union, SA Branch (the AWU or the union) for a majority support determination to be issued pursuant to s.237 of the Fair Work Act 2009 (the Act). The application as amended 1 has been made in relation to eligible production employees at the production facility operated by the Austral Brick Co Pty Ltd T/as Austral Bricks (Austral Bricks or the employer) at Golden Grove in South Australia.

[2] The AWU contended that a majority of the eligible production employees have indicated that they want to bargain with Austral Bricks. This was based upon a petition as circulated by the AWU and evidence led during the hearing of this matter.

[3] Austral Bricks contended, amongst other matters, that the petition was flawed and that Fair Work Australia should not be satisfied that a majority of employees wish to bargain based upon the material presented by the union.

[4] This matter was heard by me on 29 July 2010. Having considered the evidence, submissions and authorities touching upon the matter, on 9 August 2010, I issued a majority support determination. In so doing, I indicated that I would subsequently publish my reasons for that decision, which I now do.

The statutory requirements

[5] Sections 236 and 237 provide as follows:

Consideration

[6] Evidence was led from the following as called by the AWU:

[7] Austral Bricks led evidence from Mr Peter Baker, the employer’s General Manager of its South Australian operations.

[8] The evidence before Fair Work Australia canvasses the circumstances of the employees with the production group to be covered. This includes the fact that of the fourteen or so production employees, all but three are on individual transitional agreements 2 that mean that they are not eligible to participate in bargaining unless they enter conditional termination arrangements.3 I will return to this aspect shortly, however it is presently sufficient to note that there is no evidence that any of these employees have made termination arrangements in relation to their individual agreements.

[9] The evidence is also that some months ago the AWU circulated a petition amongst the production group at Austral Bricks, and as the bone fides of that petition is at the centre of this matter, I will return to the detail of the petition shortly.

[10] The petition has been signed by eight of the production employees and importantly, by each of the three employees who now form the group of employees for present purposes. The three eligible employees are all members of the union who had earlier not agreed to enter into individual agreements offered to them by Austral Bricks under the Workplace Relations Act 1996 (the WR Act). These particular employees remain on a collective transitional agreement as made under the WR Act in 2006. 4

[11] It is not now in contention that the AWU is a bargaining representative of an employee who will be covered by a proposed single-enterprise agreement and that an application has been made in accordance with the Act. 5 This meets the requirements of s.236 of the Act.

[12] Austral Bricks has confirmed that it has not agreed to bargain in relation to the relevant employees. This satisfies s.237(2)(b) of the Act.

[13] It is also now not in contention that the group of employees who will be covered by the agreement has been fairly chosen. This satisfies s.237(2)(c) of the Act.

[14] In that respect, the scope of eligible members of the production group is in my view fair. The production group is itself defined by reference to an organisationally distinct group and as conceded by Mr Tuck (who appeared with permission for Austral Bricks) bargaining on that basis had been conducted in part under previous legislative regimes. The fact that the group in reality comprises only three employees, is a product of the transitional arrangements of the Act rather than the choice of the union or its members. That is, Part 2 of Schedule 13 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 means that employees on individual transitional instruments are not eligible to participate in the bargaining process unless they have entered into a conditional termination arrangement. In the case of the Australian Workplace Agreements (AWAs), as these are current, this requires the agreement of the employer which has apparently not been sought or given. In the case of the single employee amongst the group on an Individual Transitional Employment Agreement (ITEA), the employee may do so unilaterally, however there is also no evidence that this has been done.

[15] To not allow the group to be defined in this manner, would in effect deny any group of employees (where some of their cohort were engaged on unexpired individual transitional agreements) from seeking to bargain. Such would be contrary to the objects and scheme of the Act.

[16] Having regard to the above findings, the relevant requirements of the Act and the comprehensive submissions of the parties, the central issue that remains is whether Fair Work Australia is satisfied that a majority of the group want to bargain as required by s.237(2)(a) of the Act.

[17] Mr Justin Hanson for the AWU argued that the purpose and intent of the petition was clear from its own terms which stated at its head:

[18] In terms of the inclusion of those employees who were on individual transitional instruments, the AWU contended that it did not know prior to the hearing of this matter which employees were on an AWA or ITEA and did not seek that information. It argued that in any event, the intentions of those who were eligible to participate were clear as they were amongst the group that had signed the petition.

[19] The AWU referred to a number of authorities said to support its approach to the matter. 6

[20] Mr Tuck for Austral Bricks argued that the petition was not sufficient demonstration of the informed wishes of the employees as it was apparently signed in circumstances where its purpose was not clear. That is, it was signed on the basis that all of the production group were being requested to endorse the proposal, rather than only those who were eligible, and in effect, this context brought the petition into doubt.

[21] Further the employer contends that as any explanation that was given to the employees did not clearly state the proper purposes of the petition, I should not accept it as satisfactory evidence of the employees’ wishes.

[22] Austral Bricks also argued that as the proposed determination would lead to serious consequences, such as good faith bargaining obligations and the potential for protected industrial action, Fair Work Australia should, in effect, rigorously apply the onus on the union to meet the statutory requirements. In so doing, Mr Tuck outlined what he saw as the implications of the determination as sought and urged caution in applying the authorities relied upon by Mr Hanson given the particular circumstances of this matter.

Am I satisfied that a majority of the eligible employees who are employed by the employer and who will be covered by the agreement, want to bargain?

[23] Section 237(3) makes it clear that I may work out whether a majority of employees want to bargain using any method considered appropriate. I have in this decision considered this question based upon the evidence before Fair Work Australia.

[24] In approaching this matter, I have had regard to the relevant objects of the Act, and in particular those set out in s.171 of the Act. I also accept that in considering whether the statutory prerequisites have been met, I must be positively satisfied as to the requirements in section 237(2) given the express requirements of the Act and the consequences for all parties of the determination being sought.

[25] The evidence of Mr Baker does not directly go to the bona fides of the understanding of the three employees who have signed the petition and who are eligible to be considered for present purposes. His evidence is however broadly relevant to the context in which the petition was circulated.

[26] I therefore need to consider the petition, the evidence of Mr Breen, who is one of those employees, and the evidence of the AWU officials who have been involved in the process, having regard to all of the relevant circumstances.

[27] It is clear that the impact of the individual transitional instruments was not considered by the AWU officials in preparing and distributing the petition. This has affected the explanation given to the employees about its purpose.

[28] Mr Breen, took the petition to most of the production employees and sought signatures. He did not approach the entire group and stopped when he had support from what he considered the majority to be. It is clear that Mr Breen generally understood the purpose of the petition to be as stated in its heading but that if endorsed, bargaining would take place in relation to the production group as a whole. I accept that this understanding was communicated, at least in general terms, to the employees.

[29] In requesting employees to sign the petition, Mr Breen did not reveal the identity of the others who had already signed. 7

[30] Mr Mateos and Mr Marcus Hanson also explained the meaning of the petition as they understood it at that time, to a meeting with some of the employees who had signed the petition at a meeting after the petition was completed. That explanation was consistent with the heading on the petition but again was based on the assumption that it was a majority of the whole production group that was required by the Act and that bargaining would involve the entire group.

[31] The lack of a full understanding of the context for the petition and the inclusion of persons who were outside of its proper scope are relevant considerations, however in this case I am satisfied that a majority of the eligible employees have indicated that they wish to bargain with Austral Bricks. My reasons for so finding are as follows.

[32] The purpose of the petition is clear on its face, and although the explanation given was wrong in certain respects as to its scope, it is the apparent understanding of the three employees who were eligible to sign and did so, that I must consider. Each has signed having been informed that this would, if supported by the majority, lead to bargaining directed towards an enterprise agreement. The three concerned are all members of the union and are the only employees who are not on an individual transitional agreement.

[33] In these particular circumstances, the fact that the bargaining will only involve each of the three employees rather than the entire group, is not particularly significant and in their case does not undermine the informed nature of that position for present purposes.

[34] The subsequent discussions with Mr Mateos and Mr Marcus Hanson involving the employees, and more importantly the evidence of Mr Breen, who is of course one of the employees directly concerned, add support to that view. This is also relevant given that the application and the ultimate hearing in this matter have occurred some months after the petition was circulated.

[35] Nothing in the evidence of Mr Baker is sufficient to cast doubt upon the nature of the position as adopted by each of the three relevant employees.

[36] Accordingly, I am also satisfied that the requirements of s.237(2)(a) of the Act have been met in this matter.

Is it reasonable in the circumstances to make the determination?

[37] Section 237(4) of the Act also requires me to consider whether it is reasonable to make the determination. Having regard to all of the circumstances of this matter I so find. These circumstances include the fact that the eligible employees remain on an enterprise agreement that is now some three and half years beyond its nominal life and given that Austral Bricks has refused to bargain, this determination is the only means by which bargaining can be initiated on their behalf.

The Determination

[38] A majority support determination was issued by Fair Work Australia on 9 August 2010 (PR500253).

COMMISSIONER

Appearances:

J Hanson for The Australian Workers’ Union, SA Branch.

J Tuck with permission for Austral Brick Company Pty Ltd T/as Austral Bricks.

Hearing details:

2010:

Adelaide

29 July

 1   The application was amended by leave of Fair Work Australia to name the group of employees in the modified form.

 2   Australian Workplace Agreements and Individual Transitional Employment Agreements that continue to apply by virtue of Schedule 3, Item 2 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009.

 3   Schedule 13 - Part 2 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009.

 4   Austral bricks Golden Grove Enterprise Agreement 2005 as approved by Dangerfield C on 28 June 2006 (AG865553 PR973194) with a nominal life expiring on 1 January 2007.

 5   The AWU is a registered organisation of employees as defined by s.12 of the Act by virtue of the Fair Work (Registered Organisations) Act 2009. The application was taken in the name of the State Branch of the AWU and I understand that it is a recognised entity with powers as part of the federally registered organisation under the rules of the AWU. It is clear that the AWU also has members amongst the employee group.

 6   These included NUW v CMC Coil Steels Pty Ltd [2010] FWA 410, 22 January 2010 per Kaufman SDP; TCFUA v Kennon Auto Pty Ltd [2009] FWA 1377, 1 December 2009, per Whelan C; ASU v Regent Taxis Limited t/as Gold Coast Cabs [2009] FWA 1642, 10 December 2009 per Richards SDP; and CFMEU v Freo Group Limited [2010] FWA 2592, 30 March 2010 per McCarthy DP.

 7   Transcript PN200 - 220.



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