[2013] FWC 3231

FAIR WORK COMMISSION

DECISION

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

Media, Entertainment and Arts Alliance
(B2013/616)

COMMISSIONER SPENCER

BRISBANE, 5 SEPTEMBER 2013

Majority support determination for APN employees engaged in literacy.

[1] This decision relates to an application made by the Media, Entertainment and Arts Alliance (the Applicant/MEAA) under section 236 of the Fair Work Act 2009 (the Act) for a majority support determination to cover certain employees of the following Respondents:

(collectively the Respondents/Companies)

[2] The employees, proposed to be covered, are employees of the Respondents “engaged in journalism in its literary, artistic and photographic branches and/or the gathering, writing or preparing of news matter or news commentaries”.

[3] Directions were set for the filing of written submissions and evidence. The parties both filed materials in accordance with the Directions. The matter was heard, primarily, on 29 April 2013.

[4] The Applicant was represented at hearing by Mr Merrell, of Counsel. The Respondent was represented by Mr Murray Procter, Partner of DLA Piper.

[5] Whilst not all of the submissions and evidence are referred to in this determination, all of such have been considered.

Relevant legislation

[6] Section 236 of the Act provides as follows:

[7] The Fair Work Commission (the Commission) must make a majority support determination in accordance with s.237 of the Act:

[8] Section 172 of the Act provides:

Summary of Applicant’s submissions and evidence

[9] The Applicant submitted that each of the Respondents is a related body corporate of each of the other Respondents and that each Respondent is an employer. The Applicant submitted that the Respondents are single interest employers for the purposes of s.172(5) of the Act.

[10] The Applicant submitted that the MEAA is a bargaining representative for one or more employees who would be covered by the proposed agreement.

[11] The Applicant presented a petition of employees as evidence that a majority of employees who would be covered by the proposed Agreement want to bargain with the Respondents. Further discussion is set out below, about the reliance on the petition as a means of being satisfied that a majority of employees, who will be covered by the agreement, want to bargain.

[12] Ms Terri Butler, solicitor of Maurice Blackburn Lawyers, stated that the Respondents had not yet agreed to bargain with the Applicant. To this end, Ms Butler attached correspondence (to her affidavit in the proceedings) from the Applicant to Mr Mark Algie, Human Resource Director of APN Australian Regional Media. 1 This correspondence confirmed that MEAA had written to Mr Algie in 2011 seeking to initiate bargaining, a request which was not agreed to. It was further outlined that the Applicant intended to apply to the Commission for a majority support determination. This correspondence was responded to by Mr Algie, who did not dispute, the assertion of the Applicant in relation to the 2011 offer to commence bargaining and again confirmed that the Respondents had not agreed to bargain.

[13] The Applicant made submissions as regards to the fairly chosen test (s.237(3A) of the Act). The Applicant submitted its proposal to negotiate an agreement that covers all editorial staff, would ensure fairness, equality and consistency across editorial staff. The Applicant submitted that in the context of s.237(2)(c), the selection of the group was “not arbitrary or discriminatory”, and that the process of determining whether a group has been fairly chosen involves comparing the group chosen with any remaining employees employed by the employer.

[14] The Applicant submitted that the consideration of the ‘geographical, operational or organisational’ distinctness of the group (a reference to s.237(3A) of the Act) was a consideration, but was not determinative of the matter that the Commission was required to be satisfied of, by virtue of s.237(2)(c). The Applicant submitted that the group of employees sought to be covered was operationally and organisationally distinct from other employees employed by the Respondents. The Applicant also argued that in the interests of fairness and equity, the group of ‘editors’ should be captured by the same industrial instruments as other editorial staff.

[15] In the alternative to the submission above, the Applicant submitted that the group was fairly chosen as the proposed coverage is “materially the same” as under previous applicable awards and collective agreements. 2

[16] The Applicant submitted a petition of employees, with 101 of the total 392 employees signing the petition. During the course of Hearing these figures were amended and admitted into evidence as Exhibit 10. The amended figures were 134 on the list of petitioners in support out of 408 relevant employees. 3 The Applicant submitted that the petition of employees provided, demonstrated that a majority of the affected employees wanted to bargain. However the Applicant acknowledged that there was a significant dispute between the parties about whether the petition indicated majority support amongst the relevant employees as per the test in the Act.

[17] The Respondents raised a series of issues with the reliability of the petition. Mr Andrew Gage, Human Resources Manager, in his evidence stated:

[18] Taking into account that the number of employees listed on the petition did not represent a majority of the relevant employees, and the critique by the Respondents of those recorded on the petition, I could not be satisfied that a majority of affected employees want to bargain. Accordingly, a postal ballot (of affected employees), to be conducted by the AEC, was ordered.

[19] In regards to whether a majority of employees who will be covered by the agreement want to bargain, the Applicant submitted that the Commission could rely on the results of the postal ballot, conducted by the Australian Electoral Commission (AEC), with the results declared on 12 June 2013. The results indicated that of the 162 ballots admitted to scrutiny that 91.98% were in favour of bargaining. The AEC’s determination of results are discussed further below.

[20] The tallied ballots showed that of the 162 ballots admitted to scrutiny, 149 approved the action for a majority support determination, 12 did not approve and there was 1 informal ballot paper.

[21] The Applicant addressed the 41.75% of the employees returning a ballot by noting that the figure does not necessarily represent indifference or opposition to bargaining and can be explained in terms of the circumstances of the employees’ location (throughout regional Queensland) and in terms of the distribution of the ballot. The Applicant stated that a number of employees had contacted the AEC, on the basis that they had not received a ballot paper; that one employee’s ballot paper was sent to the wrong address; and, that at least one other employee, was overseas, at the time the ballot was conducted. The Applicant provided evidence in the form of three affidavits from Mr Kevin McDonald, sub-editor, Mr Trevor Hockins, print editor and Mr Len Lester, night editor for the Respondents. These three employees provided evidence as to some of the issues experienced with the ballot process.

[22] The Applicant made submissions, as to the appropriateness, of relying on the returned ballot result, as a measure of whether a majority of employees want to bargain. The Applicant submitted, that the test for assessing majority support determinations could be distinguished from protected action ballots, for which the Act specifically provides that 50% of the employees on the roll of voters must vote in order to determine whether protected industrial action is authorised.

[23] The Applicant submitted in comparison that there is no express requirement in the Act, for majority support determinations to meet the tests of those provisions. The Applicant referred to the Explanatory Memorandum to the Fair Work Bill 2008 which states: “...FWA will have the power to test the support amongst the employees to which the agreement will apply in a manner it considers suitable...”. On this basis the Applicant submitted the Commission has discretion in relation to determining an appropriate method for testing support. In addition the Applicant submitted that, given that the Commission has the discretion to further test the level of support, neither the case law nor the legislation require that this testing by way of ballot must predate the application.

[24] In relation to how to ascertain the level of support, based on the outcome of the ballot, the Applicant provided evidence from Professor Ian Gordon, Director of the Statistical Consulting Centre at the University of Melbourne. Professor Gordon outlined that the ballot itself provides a sound sample of the overall population. Accordingly, the Applicant submitted, on the basis of the petition and the ballot outcome, that a majority of employees want to bargain.

[25] The Applicant stated that the Commission could exercise a discretion to be satisfied 5 of majority support, taking into account the circumstances of the ballot and the statistical outcome of the ballot results. The Applicant submitted that it was reasonable in the circumstances to issue the determination.

Summary of Respondents’ submissions and evidence

[26] The Respondents submitted that the Commission does not have discretion as to whether to issue a majority support determination. 6 Further it was submitted that the power to issue a determination only arises after the requisite satisfaction has been reached by the Commission.7

[27] The Respondents submitted that the industrial history of the Respondents’ operations is that each “masthead” (ie each of the individual second to fifteenth Respondents) has each had separate enterprise specific industrial instruments (the historical agreements). Further the first Respondent has never been covered by a collective agreement as proposed in this matter.

[28] The Respondents submitted that of the historical agreements referred to above each have covered employees who fall within the Rules of the Applicant but have generally excluded the position of Editor. It was submitted that this was in line with the coverage of the pre-modern award. The Respondents identified that each of the historical agreements; had a term that each historical agreement, is not to be used as a precedent for other employers.

[29] In regards to the fairly chosen aspect, the Respondents submitted that the group as put forward, to be covered by the proposed Agreement, was not fairly chosen. The basis for this was, the inclusion of Editors in the proposed coverage. The Respondents submitted that as Editors have traditionally been excluded, from the coverage under the pre-modern award and the historical agreements, and as the Applicant has not provided any notification or reasoning for the inclusion of Editors the group is not fairly chosen.

[30] In this regard the Respondents relied upon the Full Bench decision of CBI Constructors Pty Ltd v CFMEU 8 (CBI). It was submitted that in CBI it was held that “fairness”, as concerned in s.237(2)(c) of the Act (fairly chosen), is assessed in “a practical way, not in some philosophical or abstract fashion”.9

[31] The Respondents submitted that the practical matters that arose for consideration are that Editors have not been covered previously by the historical agreements, and are expressly excluded from the relevant modern award and pre-modern award. Further it was argued that the historical, industrial context of the Respondents, is that each Respondent has had separate industrial instrument coverage.

[32] As to the time that the Commission should assess majority support, the Respondents submitted that the Applicant, has not identified the appropriate time. The Respondents identified some first instance decisions, where Members of the Commission have held that the appropriate time to determine majority support, is the time when the Commission makes the determination. 10 The Respondents submitted that the Commission as presently constituted should not follow this authority. The Respondents submitted that the time to assess majority support should be the date on which the application is made. In this matter the Respondents submitted that the relevant time was 8 March 2013.

[33] The Respondents’ submissions in relation to majority support were provided on the basis of the submission above being correct. That is as at 8 March 2013, the Respondents submitted that there were 392 employees who fell within the proposed coverage. The Respondents submitted that the petition filed in support of the application identified 207 names. The Respondents identified several issues with the reliability and or accuracy of the petition. The matter of the petition, as a basis for a finding of majority support is discussed later in this decision.

[34] In regards to whether it is reasonable in the circumstances to make the determination, the Respondents submitted, that this matter only becomes relevant if the Commission is satisfied of the other matters. The Respondents submitted that the historical background (discussed above) and some matters raised by the Explanatory Memorandum to the Act made it unreasonable in the circumstances to issue a determination.

Consideration

[35] It was conceded by the Respondents that an application has been made and that the application complies with s.236(2) of the Act. 11

s.237(2)(a) - Majority of employees

[36] In the material, the Applicant provided a petition, which it relied upon as supporting a finding that a majority of employees wanted to bargain with the Respondents, for the proposed agreement.

[37] In addition to the petition the Applicant filed, on an interlocutory basis, an application for the Commission to issue an Order that the AEC conduct a ballot of employees for the purpose of ascertaining whether a majority of employees want to bargain with the Respondents. The Commission did not consider it appropriate to issue the Order at the time and determined to consider the application at the time of the hearing in the substantive matter.

[38] During the hearing of the matter, and in the Respondents’ submissions, there were several issues identified with the reliability and/or accuracy of the petition tendered by the Applicant as evidence, whereby they questioned whether the results did confirm that a majority of employees want to bargain.

[39] On the basis of numbers in the petition, and questions regarding the reliability of the petition, the Commission determined, pursuant to s.236(3) of the Act, that in order to assess (against the legislative tests) whether a majority of employees want to bargain it was appropriate to order the AEC to conduct a ballot. The circumstances warranted this, given that the Respondents’ operations are spread out across Queensland and that the Applicant raised difficulties it had experienced in communicating with its members because of the nature of the work and location of the work. The inherent reliability in AEC processes would minimise any uncertainty with the results.

[40] Following further consideration of the parties’ submission, an Order for the AEC to conduct a ballot was issued, with related information for employees.

[41] The Commission was notified by the AEC on 12 June 2013 that the ballot had concluded. A formal declaration of results was issued. The Returning Officer of the AEC has declared the following 12:

[42] As to the results of the question posed to the employees, the Returning Officer of the AEC has declared the following results:

[43] Shorty after the AEC returned the results, the Applicant submitted to the Commission that the Commission must be satisfied that a majority of employees want to bargain.

[44] The Respondents submitted however that the results cannot satisfy the Commission that a majority of employees want to bargain. The Respondents submitted that, in order for the Commission to be satisfied as to the majority (of relevant employees wanting to bargain, as per the legislative test), 195 employees (being 50% of 388, the total number of employees, plus one) needed to vote in favour of bargaining.

[45] The Commission has a discretion to assess majority support; the Commission has taken into account the submissions of the parties as to matters that should be taken into account in reaching satisfaction on whether majority support has been achieved. Some of the circumstances presented to the Commission included the widespread geographical locations of the Respondents’ operations, the difficulties that this presents to the Applicant in having meaningful discussions with all members, in a short period of time and the matters that arose during the hearing of the matter.

[46] Given the provision affords the Commission a discretion to test the majority support, the appropriate time to determine majority support in this matter is not the restricted time at which the application was lodged, but when satisfaction as to the test can be confirmed.

[47] While the Commission accepts the Respondents’ submission that the Commission must be satisfied of majority support, before issuing a majority support determination, the inclusion of s.237(3) of the Act weighs against the Respondents submission that the time of the assessment is the time of the application being made. While an Applicant should have a genuinely held belief that the elements of the action existed prior to lodging an application for a majority support determination, the Act gives a discretion to the Commission to determine majority support by “any method the FWC considers appropriate”. If the time for testing this was at the time the application was made, that would hinder the discretion to test the majority support and it ignores the consideration of the practicalities that often arise in large scale negotiations such as these.

[48] The time, for assessing majority support is a time “determined by the FWC” 13 and depends on the circumstances of the particular matter, that arise for consideration of the Commission. In this matter the Commission determines that the appropriate time for majority support assessment is the time at which the AEC declared the results of the ballot. Accordingly the result of the AEC ballot must be examined (this issue is discussed further below).

s.237(2)(b) - Have not yet agreed to bargain

[49] Mr Algie of the Respondents, by correspondence of 5 September 2012, to the Applicant stated:

[50] The Commission is satisfied that the Respondents have not yet agreed to bargain.

s.237(2)(c) - Fairly chosen and s.237(3A) - geographically, operationally or organisationally distinct

[51] During submissions before the Commission, the Applicant submitted that the assessment as to “fairly chosen” is not a quasi scope order application. The final coverage to the proposed Agreement may not reflect the proposed coverage now sought. This is a matter, so it was submitted, for negotiation and agreement between the parties.

[52] The Commission agrees with the submission. The Respondents did not specifically submit to the Commission that the proposed group was not operationally, geographically or organisationally distinct. Indeed on the evidence it would appear that the group can be identified on the basis of the operational undertaking and their organisational position in so far as they are employed by one of the Respondents.

[53] An application for a majority support determination is not the appropriate vehicle for final determinations regarding scope, except in so far as, such a determination would affect satisfaction, that the group proposed to be covered, has been fairly chosen. While ‘fairly chosen’ must be assessed in a practical way, the Respondents did not submit any convincing practical limitation as to the inclusion of the disputed categories of employees beyond the historical considerations.

[54] On the material before the Commission, in this matter, the Commission is satisfied that the group of employees disclosed by the application, is fairly chosen. The Commission has taken into account, whether the group is geographically, operationally or organisationally distinct.

s.237(2)(d) - Reasonable in all the circumstances

[55] The Respondents relied upon the Explanatory Memorandum in relation to a reference to a majority support determination being a mechanism for resolving “protracted” industrial disputes. The Respondents compared the circumstances of this matter to the Boeing dispute. 15 The absence of industrial disputation at all, or protracted industrial disputation, was a relevant consideration in the Respondents’ submission.

[56] The Commission acknowledges the terms of the Explanatory Memorandum and the submissions of the Respondents in this regard. However the terms of the Act do not require the Commission to specifically take into account industrial disputation on site, nor does it require the Commission to make a finding as to “protracted” industrial disputation.

[57] The Respondents submitted that the conduct of the Applicant, was to be taken into account in considering reasonableness. It is a matter which may be taken into account and depends upon the circumstances before the Commission, at the time of considering a determination. In this matter the Respondents submitted, (in reliance upon case authority of the Commission), 16 that failure by the Applicant to outline the basis or facts, to the Respondents, for considering that a majority existed, in attempting to initiate bargaining, weighed against the reasonableness in the circumstances.

[58] The decision of LHMU v MSS Security Pty Ltd 17 has been taken into account, in assessing the limited evidence in this matter. Relevantly the Commission has before it two pieces of correspondence which go to the discussions between the parties regarding commencement of bargaining.18

[59] The evidence before the Commission is that the Applicant has been seeking to commence negotiations since about 2011. The Applicant has sought to commence bargaining with the Respondents and have been unsuccessful, however, there is no evidence before the Commission of any improper conduct, of the Applicant or the Respondents.

[60] Regarding the question of the response of Mr Algie dated 5 September 2012 it is noted where he stated:

[61] There is no evidence of a response being provided to Mr Algie by the Applicant to this matter. It is not a matter that, in the present circumstances, prevents a determination being made. This employer declined to bargain and the Applicant relies on this in relation to the legislative tests.

Conclusions

[62] The issue in contention between the parties is whether the tests in s.237(2)(a) and (b) are satisfied. The Commission is satisfied that all of the other legislative requirements have been met, as follows: the MEAA, as a bargaining representative, has made a valid application, the agreement being sought is a single enterprise agreement, the Respondents have not agreed to bargain, on the material the group of employees is fairly chosen and it would be reasonable, if I could be satisfied on the basis of the ballot results that a majority of employees wish to bargain, for a determination to be made.

[63] In this matter the initial material, provided in terms of the petition, fell short of providing the required majority support results. Accordingly, given the mitigating circumstances argued by the Applicant in terms of the distance in organising the petition and for the Union, in being able to communicate with their members and all of the associated issues, it was appropriate to order a ballot by the AEC.

[64] Professor Ian Gordon gave evidence in providing his opinion on the following question regarding the ballot, stated as follows:

[65] The results of the ballot (149 of 162 ballots returned, supported bargaining) demonstrated that, whilst there was a high or “reasonable” 20 return of ballots when compared with “many circumstances”21 and a significant proportion of those voted in favour of negotiating an agreement, the ballot results do not meet the legislative tests of s.237(2) of the Act regarding satisfaction that a majority of employees, who are employed by the employer, who will be covered by the Agreement want to bargain.

[66] In pure statistical or mathematical terms (regarding an interpretation of the population of those returning a ballot) the evidence of Professor Gordon is not challenged. However, the Act requires that the Commission reach a level of satisfaction in the context of the wording of the Act and the tests stipulated in relation to the population of the employees covered by the Agreement. Professor Gordon’s evidence is instructive but not persuasive or determinative of the matter. The Commission does not accept that the propositions put forward by the Professor are applicable to concluding satisfaction of majority support, under the Act. If the Act required the Commission to undertake assessments of the reliability of drawing majority support from a lesser sample it would have stated that that is what should be undertaken. The assessment of majority is a practical one, not one to be based upon complex mathematical calculations. The submission of the Applicant in this regard was akin to asking the Commission to infer majority support on the basis of the AEC results and subsequent evidence.

[67] The Commission has considered the evidence of the employees submitted by the Applicant in support of their submission that the AEC ballot (providing an amply number of votes) could satisfy the Commission of majority.

[68] The Applicant considered the results represented a majority. Mr Chesher gave evidence that a number of employees had contacted the AEC as they had not received ballot papers. Even if these numbers are added a majority is still not achieved.

[69] Mr Hockins evidence was that his ballot was sent to an incorrect address but that he was nevertheless able to retrieve that ballot and vote. Although it was submitted that it cannot, from the AEC results, be verified whether Mr Hockins vote was actually counted this evidence is not of real assistance to the Commission. In any ballot of a fair size, and fair geographical spread, a certain margin of error would reasonably be expected.

[70] Mr McDonald’s evidence was that he was away at the time of the ballot. Again this evidence is not entirely useful to the Commission. If it were given much weight, being reflective of only one vote out of 388, it would set a bar that would be too high in these kinds of matters and lead to circumstances where the Commission is asked to conduct ballots of this nature after having verified that all employees are in the country or at their home etc. The practicalities of this would be unacceptable. The Commission has nevertheless considered the evidence of Mr McDonald in the wider context of the Applicant’s submission.

[71] And finally the evidence of Mr Lester, who was cross-examined, gave evidence about his change of address and the possibility that that change of address was not actioned in time by the Respondents. This evidence again, on its own, does not assist the Commission in any substantial way.

[72] The Commission has approached the evidence of the three employees (discussed above) in an overall or contextual sense when considering the submissions of the Applicant and assessing majority support from the ballot. The Commission is not satisfied that this evidence alters the basis upon which the ballot results should be utilised by the Commission.

[73] The Applicant quite rightly pointed out that, in reliance upon the often quoted Coal and Allied v AIRC 22, the inclusion of the word “satisfied” means that the exercise is an assessment of the Commission of the specified circumstances that is the essential precondition to the exercise of a power. The information before the Commission in this matter, in totality, does not satisfy the Commission that majority support exists, in terms of the test in s.237(2).

[74] The AEC ballot result does not satisfy the Commission that a majority of the relevant employees want to bargain. Therefore the application for a majority support determination, on the material before the Commission, is refused. Therefore for the aforementioned reasons the Application pursuant to s.236 of the Act, filed by MEAA in relation to the Respondents is dismissed.

[75] I Order accordingly.

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COMMISSIONER

 1   Exhibit 3, annexure TMB11.

 2   Exhibit 1 at paragraph 17.

 3   Exhibit 10.

 4   Statement of Andrew Sampson Gage, at 9 to 11.

 5   Coal and Allied v AIRC [2000] HCA 47 at [76] per Kirby J.

 6   Exhibit 11 at paragraph 8.1.

 7   Ibid at paragraph 8.2.

 8   [2011] FWAFB 7642, at [37].

 9   Ibid.

 10   See ASU v Regent Taxis Ltd t/a Gold Coast Cabs [2009] FWA 1642 for example.

 11   Exhibit 11 at paragraphs 18-20.

 12   Australian Electoral Commission, Declaration of Results in regard to Majority Support Determination B2013/616, dated 12 June 2013.

 13   Fair Work Act 2009 (Cth) s.237(2)(a)(i)

 14   Exhibit 3, annexure TMB12.

 15   Explanatory Memorandum 2008 at [R.136].

 16  LHMU v MSS Security Pty Ltd [2010] FWA 314.

 17   Ibid.

 18   Exhibit 3 annexures TMB11 and TMB 12.

 19   Report of Professor Ian Gordon at 3 to 7 and 10 to 11.

 20   Report of Professor Ian Gordon at 7.

 21   Ibid.

 22   [2000] HCA 47.

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