Fair Work Act 2009
Section 739 - Application to deal with a dispute

"Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU); and
Australian Workers’ Union;
v
ASC Pty Ltd T/A Australian Submarine Corporation
(C2021/8352 and C2021/8385)

Dispute about matters arising under the enterprise agreement and the NES;[s186(6)] – COVID-19 Policy – control measures – mandatory vaccination – lawfulness – consultation obligations – Privacy Act 1988 – policy not unlawful – reasonableness – whether policy disproportionate to risk in wake of border opening and easing public health restrictions – policy not unreasonable – recommendations concerning implementation

[1] On 8 and 10 December 2021 the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers’ Union (AMWU) and the Australian Workers’ Union (AWU) (collectively, the Unions) applied to the Commission under s 739 of the Fair Work Act 2009 (the FW Act) to deal with a dispute 1.

[2] Both applications concern a common subject matter and, by consent, were dealt with jointly.

[3] The respondent to the dispute is ASC Pty Ltd trading as Australian Submarine Corporation (ASC or the Employer).

[4] The subject matter of the dispute is a decision by ASC to introduce a COVID-19 Policy (the Policy) and in particular a requirement that employees and contractors be double vaccinated against COVID-19 before entering the worksite at Osborne, South Australia.

[5] The dispute came before the Commission under the dispute settlement procedure of the ASC Enterprise Agreement 2021 (the Agreement) (clause 13). The dispute was not resolved at the workplace level. It was referred to the Commission by the Unions under cl 13(a)(iv).

[6] Conferences were conducted by the Commission on 15 and 20 December 2021 following which the parties were referred into private conciliation.

[7] The matter did not resolve by private conciliation. Further conferences (including conciliation) was conducted by the Commission on 17, 21, 24 and 25 March 2022. Despite these endeavours, the dispute did not resolve.

[8] The Unions sought arbitration.

[9] On 8 April 2022 I issued directions. Materials were filed by the Unions and by ASC including agreed questions for determination and a statement of agreed facts.

[10] On 28 April 2022 I granted permission for the Unions and ASC to be legally represented. 2

[11] On 10 May 2022, at the request of the Unions, I made an order requiring the production of documents by ASC.

[12] I heard the matter by video conference on 12, 19 and 25 May 2022.

[13] At the conclusion of proceedings I issued an interim order 3 to the effect that, until the determination of the dispute, ASC not require persons employed under the Agreement to provide responses to show cause notices alleging non-compliance with the Policy and not otherwise take disciplinary action (if any) against such persons on that ground until that time.

[14] The interim order was a contested matter. My reasons were stated on the record at the time. I need not repeat them.

Evidence

[15] I received written and oral evidence from nine persons:

•  Stuart Gordon, Assistant State Secretary AMWU (SA); 4

•  Nathan Crack, Branch Organiser AWU (SA); 5

•  Andrew Solly, Operator, ASC; 6

•  Sonya Billoo, Tradesperson, ASC; 7

•  John Schuit, Delegate (AWU) and Health and Safety Representative, ASC; 8

•  Paul Sandford, Senior Site Delegate AMWU (SA); 9

•  Ben Stocks, People and Culture Manager ASC; 10

•  Stuart Whiley, Chief Executive Officer (CEO), ASC; 11 and

•  Joanne Horne, Executive Manager – People and Culture, ASC. 12

[16] Substantial documentary materials were attached to the witness statements and in particular those of Messrs Crack, Schuit, Stocks and Ms Horne. Other documents, including a video presentation to employees by ASC’s Chief Executive Officer, were admitted by consent.

[17] All witnesses who gave evidence were conscientious to the task, and whilst seeing events from their perspective, largely did not embellish their evidence. Aspects of the evidence of each witness crossed the line between fact and opinion. In a matter such as this where the adequacy of consultation and reasonableness of a policy are in issue, it is not surprising that subjective opinions were expressed. I give weight to factual matters and treat opinions as largely contextual and an element of overall submissions.

[18] Whilst some of the union officials and delegates who gave evidence did not recount in chief a full narrative of ASC’s interaction with them concerning the Policy, each readily accepted in cross examination that additional meetings had been held or emails had been sent or received. I make no adverse findings of credit on that account.

[19] Union witnesses necessarily had no line of sight into internal events in ASC particularly between 10 and 23 November 2021. Whilst the Unions challenged aspects of the evidence of employer witnesses (and in particular events in that fortnight), I consider the evidence of Mr Stocks, Mr Whiley and Ms Horne to be a reliable basis for decision-making. I found the evidence of Mr Stocks and Ms Horne in particular to be direct, forthright and credible.

[20] With those caveats, broadly speaking, the facts (at least those following ASC’s announcement on 23 November 2021) are not in dispute.

[21] In determining this matter I have regard to all material before me, including the Agreement. Where I do not make reference to particular facts or submissions, I do so not because I have not considered them but because to do so would repeat or add unnecessary length to these reasons.

[22] Recognising that the agreed facts (below) deal somewhat with COVID-19, I note that neither the Unions nor ASC adduced evidence from public health officials or epidemiological experts concerning current variants of COVID-19 or the risks they present.

Facts

Enterprise Agreement

[23] The industrial instrument relevant to the dispute is the ASC Enterprise Agreement 2021.

[24] The Agreement covers ASC and persons it employs in manufacturing and maintenance work on submarines at Osborne, South Australia. It does not cover work performed by persons on the manufacture and maintenance of other vessels (frigates) at Osborne South Australia nor on construction and maintenance of vessels at Henderson Western Australia. Those operations are covered by separate enterprise agreements.

[25] The applicant Unions are two of three employee organisations covered by the Agreement. 13

[26] The Agreement was made on 26 May 2021 and approved by the Commission on 19 May 2021. It has not reached its nominal expiry date (26 March 2024).

Agreed facts

[27] The following were submitted as agreed facts. 14

“The Parties

1. ASC Pty Ltd (“ASC”) is a Commonwealth government owned entity.

2. The specific activities of ASC include:

2.1. Sustainment of the Collins Class submarine program through:

(a) full cycle docking major overhauls;

(b) mid cycle dockings; and

(c) the provision of in operation servicing.

2.2. Extension of life activities related to the Collins Class submarines operated by the Royal Australian Navy;

2.3. The operation of a submarine training and systems centre which provides ongoing training to Royal Australian Navy personnel, usually on a 24/7 basis; and

2.4. Supporting other shipbuilding activities for the Royal Australian Navy.

3. ASC conducts submarine maintenance from a facility in Osborne, South Australia and a facility in Henderson, Western Australia, however, from time to time, employees involved in undertaking maintenance activities may be deployed to interstate or international locations to undertake unplanned maintenance work on submarines that have embarked from an Australian port.

4. The provision of services to the Royal Australian Navy involves meticulous project planning for up to 2 years (for full cycle docking major overhauls) ahead of the commencement of a work program that, in respect of a full cycle docking major overhaul, may be for a period of approximately 2 years.

5. Employees undertaking work pursuant to the ASC Pty Ltd Enterprise Agreement 2021 (“Agreement”) may be required to undertake work:

5.1. inside of submarines – which can have up to 80 people working inside them at the same time and can involve working in a cramped environment;

5.2. on the external structure of submarines, often using scaffolding or other equipment used to elevate employees;

5.3. in workshops established for the purposes of undertaking work associated with the maintenance of submarines;

5.4. in stores maintained for the purposes of undertaking work associated with the maintenance of submarines; and/or

5.5. on submarines that have embarked from Port and are being operated by the Royal Australian Navy.

6. Employees will also access, from time to time, the office facilities at the Respondent’s locations to attend meetings, to undertake training and to access shared canteen and lunch room facilities.

7. The workforce engaged in submarine maintenance at Osborne and covered by the Agreement is highly unionised. The Agreement covered workforce are predominantly members of:

7.1. The Australian Manufacturing Workers Union;

7.2. The Australian Workers’ Union; or

7.3. The Communications, Electrical and Plumbing Union.

COVID-19

8. Severe acute respiratory syndrome coronavirus 2 (“Covid-19”) is a respiratory illness.

9. Omicron is less severe and has resulted in less hospitalisations than previous variants but is transmissible and can result in serious illness or death.

10. On 1 February 2020, the South Australian government announced the first confirmed case of Covid-19 in South Australia.

11. On 15 March 2020, a public health emergency was declared in South Australia, and various social distancing and other measures were enforced in order to minimise the spread of Covid-19. 15

12. On 24 March 2020 the South Australian government closed the state’s borders.

13. In or about July 2021, the South Australian government increased restrictions as a result of a number of people testing positive for the Delta variant of Covid-19.

14. On 23 November 2021, the South Australian government opened South Australia’s state borders.

15. On 10 December 2021, South Australia recorded its first case of the Omicron variant of Covid-19.

16. On 7 March 2022, the South Australian government removed the mandatory vaccination requirement for South Australian Police Officers which had previously been in place.

17. On 30 March 2022, the South Australian government removed the mandatory vaccination requirement for public school teachers and maritime workers boarding international vessels in South Australia.

18. On 15 April 2022, the South Australian government reduced the number of venues and circumstances in which people are required to wear a face mask.

19. As at 21 April 2022:

19.1. 95.4% of South Australians have received their first vaccination; and

19.2. 93.3% have received both their first and second dose.

20. As at 16 May 2022:

20.1. 95.7% of eligible South Australians aged 12+ have received their first dose of the vaccine;

20.2. 93.7% have received their second dose;

20.3. 72.2% of eligible South Australians have received a booster dose and 66.6% of South Australians aged 16+.

Source: www.covid-19.sa.gov.au/latest-news/covid-19-update-16-may-2022

21. As at 21 April 2022 the overall rate of Australians over 16 years of age who are fully vaccinated was above 95%.

22. Covid-19 vaccines currently available in Australia substantially reduce the risk of serious illness or death.

23. While other measures, such as mask wearing, and social distancing, are demonstrated to reduce the transmission of Covid-19, the effectiveness of these measures depends on people applying them consistently or correctly. They do not provide a substitute for the constant protection offered by vaccines, nor do they reduce the risk of developing serious illness once somebody acquires an infection.

Vaccination Policy

24. In October 2021, ASC Management identified that there was an increased likelihood that the Covid-19 pandemic would have a greater impact on its business than it had since the commencement of the pandemic due to recent increases in Covid-19 infections in Australia, particularly in New South Wales and Victoria.

25. Prior to 23 November 2021, ASC had not advised the workforce of:

25.1. the terms of the proposed Policy;

25.2. the existence of a proposed Policy; and/or

25.3. that it was considering implementing the proposed Policy.

26. On 22 December 2021, the Respondent communicated the decision to proceed with the Policy (with some modification) to the workforce, to Joint Consultative Committee members and to Health and Safety Representatives.

27. Between 28 January 2022 and 6 March 2022, ASC Management, Health and Safety Representatives and members of the Joint Consultative Committee participated in a review of a risk assessment prepared in respect of the Policy.

28. On 8 March 2022, ASC advised the Agreement covered workforce that ASC would proceed with implementation of the Policy.

29. A consequence of failing to observe the vaccination requirements of the Policy includes the potential for termination of an employee’s employment on the grounds of not being able to meet the inherent requirements of the role if the employee does not have a personal or medical exemption.”

Other findings of fact

Policy Announcement November 2021

[28] On 26 October 2021 ASC undertook a survey of its Western Australian and South Australian workforces “to understand the impact and risk mitigation strategies we need to have in place as a business to manage COVID-19” 16. Participation was voluntary. In material accompanying the survey, ASC stated that “ASC have no intention to making a company policy which mandated the need for vaccinations”17. At the time of conducting the survey ASC did not have a policy mandating vaccination as a condition of entry to its worksites.

[29] On or about 10 November 2021 ASC via its Executive Management group (Executive) formed the view that the environment had changed based on an announcement by the South Australian government of a border opening (planned for 23 November) and an announcement by the Navy of a requirement that persons on its vessels in open water be double vaccinated. 18 The ASC Executive proposed changes to its COVID-19 Policy. This included immediate control measures (phase 1) and a later mandatory double vaccination requirement (phase 2) (collectively referred to as the Policy).

[30] Between 10 and 23 November 2021 ASC executives (and in particular its Executive Manager – People and Culture Ms Horne) informed relevant arms of management of the decision. This included the People and Culture Manager, Mr Stocks. Mr Stocks was charged by Ms Horne to lead the consultation process with employees and employee representatives. Mr Stocks prepared a consultation plan. In this fortnight, other arms of management prepared a communication pack and video announcement.

[31] ASC communicated the decision to employees and their representatives on 23 November 2021 via a video (by the CEO) and communication pack (which included a proposed timeline). This was the same day on which the South Australian government re-opened its borders to interstate travel.

[32] ASC commenced a process of consultation.

[33] Mr Stocks met with the ASC Joint Consultative Committee (JCC) and Health and Safety Representatives (HSRs) the day after the announcement (24 November 2021). That same day Mr Stocks contacted and wrote to officials of the AMWU and AWU about the proposed changes.

[34] The following day (25 November 2021) Ms Horne met with Mr Gordon of the AMWU and a delegate on the proposed changes in advance of the AMWU holding a workplace meeting of members.

[35] A proposed Policy was circulated by ASC to union representatives on 3 December 2021.

[36] Following the announcement, ASC began to receive feedback from employees via the dedicated email address it had established for that purpose. ASC examined and responded to these emails. It received 64 emails in the first week after the announcement and 260 by 22 December 2021.

[37] ASC approved paid and unpaid meetings so that unions covered by the Agreement (AMWU, AWU and CEPU) could discuss the policy with their members. 19

[38] The AMWU held meetings with members on 25 November 2021, 7 December 2021 and 17 January 2021.

[39] The AWU held meetings with its members on 7 December 2021 and 17 January 2022.

[40] The CEPU held a meeting with its members on 10 December 2021 following which the CEPU advised ASC that “the CEPU does not share the concerns raised by other trade groups at Osborne or their representatives.” 20

Phase 1 measures

[41] Consultation initially focussed primarily on phase 1.

[42] Phase 1 measures (with some changes such as delayed commencement until evidence of community transmission and mask wearing by all persons including those vaccinated) operated from 6 December 2021. Commencement had originally been proposed for 1 December 2021.

Dispute notification

[43] On 8 and 10 December 2021, the AMWU and AWU notified an industrial dispute concerning the announcement. The dispute alleged a lack of consultation particularly with respect to the phase 2 measures.

[44] The Commission convened conferences of the parties on 15 and 20 December 2021.

Phase 2 measures

[45] Phase 2 required evidence of a first vaccination by 24 January 2022 and a second vaccination by 28 March 2022, following which the Policy would be enforced.

[46] Consultation on phase 2 was extended by ASC from 15 to 21 December 2021.

[47] On 21 December 2021 ASC decided to proceed with phase 2 with some modifications (such as no longer retaining vaccination certificates or medical exemptions, and including a show cause process for non-compliant employees).

[48] It made this announcement on 22 December 2021.

[49] As phase 2 remained a disputed matter, and following the 15 and 20 December 2021 conferences in the Commission, consultation on phase 2 extended into January, February and March 2022.

[50] Between 20 December 2021 and 17 March 2022 consultation on phase 2 resumed at the workplace level.

[51] A meeting between ASC and JCC members and HSRs was held on 22 December 2021.

[52] On 22 December 2021 ASC provided an overview to employees of the consultation process and of changes made to the Policy following its consideration of initial feedback. 21

[53] HSRs met on 6 January 2022 to discuss control measures that had been implemented.

[54] On 17 January 2022 ASC published the Policy: 22

“Purpose

The purpose of this Policy is to outline the requirements for COVID-19 Vaccinations at ASC. The Policy defines the minimum standards and requirements.

Scope

This Policy applies to all employees, contractors and visitors working on an ASC controlled site or location and in locations where work is performed on behalf of ASC.

Policy Statement

ASC is committed to providing workers with a safe work environment through the implementation of its Work, Health & Safety (WHS) Framework that ensures workplace health and safety risks are reduced and hazards eliminated so far as reasonably practicable.

ASC recognises the health risks posed by the global pandemic, COVID-19, and in line with the government health and medical advice accepts that the COVID-19 vaccination, is an effective measure available which may prevent and lessen risk of exposure to COVID-19 in the workplace. ASC also acknowledges that the risk of contracting or transmitting COVID-19 is heightened for its unvaccinated and/or vulnerable workers.

Accordingly, to comply with its duties to provide a safe workplace through the implementation of safety measures and risk mitigations, ASC has decided to implement a site access policy which will require individuals to be fully vaccinated against COVID-19 as a condition of entry. It will be implemented in conjunction with a range of other workplace safety measures which have been designed to minimise the risk of COVID-19 in the workplace, as outlined in our COVID-19 response controls.

This policy provides information on the requirement for all ASC employees to be vaccinated against COVID- 19 in order to minimise the risk of transmission. It also provides further information about the requirement for other visitors to ASC's workplaces to be vaccinated in certain circumstances.

Policy Objectives

1. Mandatory Vaccination

All employees will need to be fully vaccinated to attend an ASC location on and from 28 March 2022. In accordance with government health advice, COVID-19 vaccination helps to protect people by either preventing or lessening the risk of contracting the virus or reducing the symptoms of the virus and reduces transmission.

2. Providing Evidence of Vaccination

Existing employees must provide ASC with evidence of their full vaccination status before 28 March 2022, with their first dose administered prior to 24 January 2022. After these dates, new employees will be asked to provide evidence of their vaccination status before commencing with ASC.

Employees should email or show evidence of their vaccination status to the relevant Health Centre in each state or provide a hard copy. No copies will be saved on file, however for specific customer or legal requirements, a copy may be required to be maintained by ASC.

By providing vaccination information or medical evidence, each employee consents to ASC’s collection and use of this information in accordance with this Policy. ASC maintains record keeping and information sharing procedures with the aim of ensuring that all records are stored and handled securely in line with the Privacy Act 1988 and in accordance with its Privacy collection statement.

3. Exemptions to Vaccination Requirements

ASC understand that there are circumstances which will prevent some individuals from receiving a COVID-19 vaccine, such as underlying medical conditions. ASC will consider medical and personal exemptions on a case-by-case basis.

Medical exemptions will be considered in line with the Commonwealth Medical Exemption Process, which allows individuals to apply for an exemption with the Australian Immunisation Register (AIR). This process is completed by the employee’s Medical practitioner.

The exemption form is available from ASC if needed and should be returned to both the AIR and ASC. The decision to approve an exemption will be determined by the AIR.

ASC will also provide an opportunity for employees to seek an exemption based on personal circumstances. Employees can email the Health Centre with their justification for medical exemption, and the People and Culture team in conjunction with subject matter specialists if necessary, will assess the application, providing a response in writing. All personal exemption requests will be reviewed on a case-by-case basis.

If an exemption is granted, the vaccination requirement of this Policy will not apply. Additional safety controls and/or measures may be implemented for any employee who is granted an exemption.

4. Refusal to Vaccinate

Where employees who do not hold an exemption fail and/or refuse to produce proof of vaccination without reasonable grounds, they may be in breach of the ASC Vaccination Policy (COVID-19).

Employees who fail and/or refuse to provide proof of vaccination by the required timeframe will be unable to enter an ASC facility and ASC will commence a process to determine next steps. If all avenues are exhausted, this may result in the termination of the individual’s contract of employment.

We will consider the circumstances of any employee who chooses not to receive a COVID-19 vaccine (excluding for medical reasons) or not share evidence of their vaccination status on a case by case basis.

5. External suppliers, contractors and visitors

Suppliers, contractors and visitors to ASC operated sites will need to adhere to the requirements of this Policy.

Contractors will be required to provide or show proof of vaccination being provided to ASC prior to the 28th March 2022. ASC will take a register of vaccination dates for contractors, however will not take copies of any vaccination certificates.

Visitors will need to show evidence of vaccination at the point of reception, prior to entering the site. No copies of their vaccination records will be taken.

6. Future Controls

Nothing in this Policy limits or otherwise detracts from the obligations of employees to comply with any Commonwealth, State or Territory Government mandated vaccination requirements that may apply in relation to their employment with ASC.

7. Failure to Comply with this Policy

Any person employed or engaged by ASC who fails to comply with this policy may be subject to disciplinary action, which might include having their employment / engagement with ASC being considered for termination.

ASC may review and revise this policy as new information regarding vaccination and testing becomes available and as the prevalence of COVID-19 in the community changes.

[55] The Policy as published on 17 January 2022 stated that “the content in ASC’s COVID Vaccination Policy was approved by the Executive in December 2021, This content has now been put into the CMS Policy template” and referred to a “next review 17/01/2024”. 23

[56] The Policy applied to “all employees, contractors and visitors”.

[57] The Policy as published on 17 January 2022 was not limited to the ASC worksite the subject of this dispute. It applied to both ASC worksites at Osborne South Australia and to the ASC worksite at Henderson, Western Australia.

[58] On 17 January 2022 ASC met with JCC members and union representatives. The primary discussion point at that meeting was one of the control measures (rapid antigen testing).

[59] A meeting between ASC and JCC members and union representatives on the Policy was held on 18 January 2022.

HSRs risk assessment

[60] On 18 January 2022 an employee representative requested a revision of ASC’s risk assessment.

[61] A meeting between ASC and JCC representatives and HSRs was held on 21 January 2022.

[62] On or about 25 January 2022, ASC agreed that the HSRs could submit a risk assessment of their own, which would be considered by the company in advance of the proposed implementation of the second vaccination mandate on 28 March 2022.

[63] On 7 and 15 February 2022 ASC met with JCC representatives and HSRs to discuss feedback on ASC’s risk assessment and to put in place arrangements for the HSRs to conduct and submit a risk assessment of their own.

[64] On 17 February 2022 the HSRs submitted their risk assessment. The HSRs risk assessment supported control measures but not the phase 2 mandatory vaccination obligation.

[65] Correspondence was exchanged between ASC executives and HSRs between 17 February 2022 and 6 March 2022 concerning “the risk assessment and the need for the Policy” 24.

Decision to proceed with mandatory vaccination

[66] On the weekend of 5 and 6 March 2022 ASC, a subset of the Executive met and reviewed whether it would proceed with implementation of the vaccination mandate and its enforcement from 28 March 2022.

[67] The following day, 7 March 2022, the Executive decided to proceed to with the vaccination mandate (with some additional modifications for non-complaint employees such as an outplacement package, an alumni programme and a separation package option) and enforce it from 28 March 2022.

[68] Immediately following the meeting of the Executive on 7 March 2022, ASC informed a meeting of the HSRs of its decision to proceed with the vaccination mandate and of the modifications.

[69] The following day (8 March 2022) ASC advised the broader workforce of its decision to proceed.

[70] On 9 March 2022 ASC provided HSRs written confirmation of its decision and a copy of ASC’s updated risk assessment following the Executive meetings on 5, 6 and 7 March 2022.

[71] On 11 March 2022 the Unions sought relisting of the dispute notification.

[72] ASC and HSRs exchanged correspondence on the Policy and the dispute between 9 and 17 March 2022.

[73] Conferences were conducted in the Commission on 17, 21, 24 and 25 March 2022. In and around these conferences private discussions between ASC and the Unions took place. Despite a settlement proposal being exchanged, the dispute did not resolve.

Implementation of Phase 2 (mandatory vaccination)

[74] The second vaccination mandate was required by 25 March 2022 and the Policy was applied to the ASC workforce from 28 March 2022.

[75] In the period prior to 28 March 2022 ASC liaised with those of its employees who had indicated that they were concerned at or unwilling to be vaccinated. In the period between 24 January 2022 and 28 March 2022 that number of employees progressively declined.

[76] ASC reached agreement with the Unions on 29 March 2022 to put in place a holding position relating to the remaining unvaccinated employees under the Agreement, pending the outcome of these proceedings.

Provisional Improvement Notices

[77] During the course of the dispute, aspects of the dispute came before two statutory authorities, Comcare and SafeWork SA.

[78] On 15 December 2021 a SafeWork SA inspector advised ASC that it had received an anonymous complaint regarding ASC’s consultation process but that SafeWork SA intended to close the file upon perusal of materials supplied by ASC.

[79] On 27 January 2022 a provisional improvement notice (PIN) was issued by a HSR representative. ASC sought a review of the PIN. On 2 March 2022 Comcare cancelled the PIN as it was satisfied that “ASC had applied a process to consult regarding the plan to mandate vaccines and the associated risk assessment”. 25

[80] On 9 March 2022 three new PINs were issued by a HSR representative. ASC sought a review of the PINs. On 25 March 2022 these PINs were cancelled by Comcare.

[81] On 25 March 2022 two new PINs were issued by a HSR representative alleging implementation of the mandatory vaccination policy was not a reasonably practicable control based on a risk assessment, and was discriminatory. ASC sought a review of the PINs. On 12 May 2022 these PINs were cancelled by Comcare on the ground that “ASC have applied a reasonable process to implement a safe system of work”. 26 At the hearing of this matter, the Unions advised that this decision by Comcare was subject to legal challenge (administrative review).

Holding position pending arbitration

[82] At the hearing of this matter, the number of unvaccinated persons employed by ASC under the Agreement had reduced to five.

[83] Noting that ASC’s Phase 2 mandatory vaccination requirement came into operation from 28 March 2022, on 29 March 2022 ASC put in place the following interim arrangements concerning unvaccinated employees covered by the Agreement: 27

“4. In recognition of the arrangements set out in paragraphs 1 to 3 above, and subject to the conditions set out in paragraph 5 below, ASC will, in respect of the 11 employees covered by the ASC Pty Ltd Enterprise Agreement 2021 (Agreement) that had not yet provided evidence of vaccination against COVID-19 or obtained an approved personal or medical exemption as at 25 March 2022 (Relevant Employees) (which has subsequently been reduced to 7 employees at the time of writing):

(a) from 28 March 2022 and until the matter is determined (including through any subsequent Appeal proceedings):

(i) not permit any of the Relevant Employees to attend any ASC site or location;

(ii) pay the Relevant employees their usual base salary until 6 May 2022; and

(iii) from 6 May 2022, facilitate the Relevant Employees taking accrued annual leave or long service leave or unpaid leave.

(b) not terminate the employment of any of the Relevant Employees as a consequence of them not meeting the requirements of the COVID-19 Vaccination Policy unless, and until, such time as the questions posed in paragraphs 1(a) and (b) above have been determined;

(c) in the event that any of the Relevant Employees have their employment terminated on the grounds of them not meeting the requirements of the COVID-19 Vaccination Policy, not (notwithstanding any prior representations) provide the Relevant Employees with outplacement service support as part of any termination of employment arrangements.

5. Additional conditions as agreed include the following:

(a) The Directions to be issued by the Fair Work Commission for the determination of the questions posed in paragraph 1. above will provide for the filing of a Statement of Agreed Facts;

(b) In the interim (i.e. until the questions posed in paragraph 1. above are determined):

(i) ASC will issue a show cause letter to the Relevant Employees to provide them with an opportunity to provide reasons as to why their employment should not be terminated in the event that they are required to meet the requirements of the COVID-19 Vaccination Policy;

(ii) ASC may require any of the Relevant Employees to undertake such work or tasks as may be safely performed without accessing any ASC site or location; and

(iii) Any of the Relevant Employees may provide evidence that they meet the requirements of the COVID-19 Vaccination Policy or supply an approved exemption prior to the determination of the matter and will be permitted to return to work in their substantive position (noting that ASC reserves the right to take disciplinary action against any of the Relevant Employees who fail to provide such evidence as soon as practicable after being vaccinated or obtaining an approved exemption).”

Questions to be determined

[84] The Unions and ASC have agreed that the following questions in dispute be determined by the Commission: 28

“13. In an effort to articulate and confine the character of the dispute before the Commission, the parties have agreed that the central controversy concerns two questions:

13.1. has ASC met the consultation requirements prescribed by the Agreement in respect of its COVID-19 Vaccination Policy?; and

13.2. would an instruction from ASC that employees covered by the Agreement comply with the COVID-19 Vaccination Policy be a reasonable and lawful instruction?”

Submissions

AMWU and AWU

[85] The AMWU and AWU submit that ASC failed to meet its consultation obligations under both the Agreement and the Workplace Health and Safety Act 2012 (SA) (WHS Act).

[86] The Unions submit that the decision to introduce the COVID-19 Policy, and in particular the decision to include in that Policy a phase 2 vaccination mandate, was a definitive decision made without consultation. The Unions submit that consultation only occurred after the Unions objected to the phase 2 Policy, and in any event occurred only on matters of implementation and not the mandate itself. The Unions submit this was a breach of ASC’s obligations under clauses 5, 36 and 41 of the Agreement. The Unions further submit that consultation with the JCC and HSRs did not meet the statutory requirements of ss 36, 47 and 48 of the WHS Act.

[87] The Unions submit that ASC’s failure to meet its industrial and legislative consultation obligations render the vaccination mandate unlawful (and is also a ground of unreasonableness).

[88] The Unions further submit that a direction by ASC to comply with the Policy would be unlawful because vaccination is not freely consensual (as non-compliance can lead to termination of employment) and the Policy provides for the collection and retention of information contrary to the Privacy Act 1988 (Cth).

[89] The Unions submit that, aside from unlawfulness, a direction to comply would not be reasonable because the Policy itself is unreasonable. In particular, the Unions submit that the vaccination mandate is not a reasonably proportionate response to current risks created by COVID-19. The Unions point to the easing of public health restrictions by governments in the first half of 2022, including by the government of South Australia. The Unions submit that a general assessment of the reasonableness of vaccination mandates by a Commission full bench in December 2021 in Mr Arthur Coal 29 is distinguishable and not reflective of current circumstances.

[90] As the direction to employees to comply with the Policy is both unlawful and unreasonable, the Unions submit that the Commission should order that ASC not proceed further with implementation of phase 2 of the Policy, and in particular take no disciplinary action against persons employed or who may be employed under the Agreement and who do not produce proof of vaccination.

ASC

[91] ASC submit that the COVID-19 Policy, including its phase 2 vaccination mandate, is both lawful and reasonable, and that no grounds for Commission or third party intervention exist.

[92] ASC submit that the Policy was announced in November 2021 as a proposal subject to consultation. ASC submit that it consulted on the proposal directly with employees, via the formal consultative processes required by law (JCC and HSRs) and with the Unions. It submits that it took into account views expressed, and that changes to the Policy were made with respect to both phase 1 and phase 2 as a consequence of that consultation.

[93] ASC submit that it consulted on both the Policy and on its planned implementation.

[94] ASC submit that consultation directed specifically at whether the phase 2 mandate should proceed occurred in February and March 2022 through the JCC and the Unions, evidenced by the company considering (amongst other matters) a revised risk assessment by the HSRs.

[95] ASC submit that industrial and legislative consultation obligations do not extend to an obligation to agree with positions put, and that it acted lawfully in maintaining its view, after consultation, that it was appropriate to implement the mandatory vaccination element of its COVID-19 Policy.

[96] ASC submit that the claim of unlawfulness in consultation is simply the Unions disagreeing with the company decision to proceed with the vaccination mandate and advancing objections by a small number of unvaccinated employees to the mandate.

[97] ASC further submit that the Policy is not a breach of the Privacy Act 1988.

[98] Finally, ASC submit that the Policy is not unreasonable in that it has a logical and understandable basis, is fair and balanced in that it provides grounds for medical exemption, is an active measure to manage health and safety risks associated with the transmission of COVID-19 and its variants, and is a proportionate response following the opening of borders and consequent transmission in the community and within workplaces.

[99] As the Policy is lawful and one reasonably open to ASC, it submits there are no grounds on which implementation or a direction to comply should be interfered with.

Consideration

Jurisdiction

[100] The role of the Commission in this matter is one of private arbitration, defined by the terms of the Agreement.

[101] Section 739(4) of the FW Act provides that “if, in accordance with the term, the parties have agreed that the FWC may arbitrate (however described) the dispute, the FWC may do so”. However, the Commission “must not exercise any powers limited by the term” (s 793(3)), and “must not make a decision that is inconsistent with this Act, or a fair work instrument that applies to the parties” (which includes an enterprise agreement) (s 93(5)).

[102] Clause 13(a) of the Agreement relevantly provides:

“13. AVOIDANCE OF INDUSTRIAL DISPUTES

a. The following procedure shall apply to the handling of any disputes which may arise within the Company, or under this Agreement or in relation to the National Employment Standards.

i. An employee who has a grievance should report it to their immediate supervisor and may resolve it at that time. After reporting the matter to the supervisor advice may then be sought from a representative of the employee’s choice.

ii. Where any matter remains in dispute after it has been considered jointly by the appropriate supervisor and by the employee/s concerned, it shall then be examined by the officer appointed by the Company to deal with industrial matters in conjunction with the employee, or if requested, the employee representative and in any case within one ordinary working day unless otherwise agreed.

iii. All of whom shall take all reasonable steps to settle the dispute.

iv. If the dispute remains unsettled after the procedures specified above have been concluded, the matter will be referred to the Fair Work Commission for conciliation and/or arbitration. The parties to the dispute will comply with the Fair Work Commission’s decision. Any party to the dispute may appeal the decision to a full bench of Fair Work Australia within 21 days of advice of the arbitrated decision. Parties to the dispute are entitled to representation.

v. While the procedures specified herein are being followed work shall continue normally and the status quo of the matter in dispute shall remain, having regard to the Work Health and Safety Act 2011. "Status Quo" means the established work practices in place immediately prior to the clause being activated.

vi. The ultimate terms of settlement of the dispute shall not be affected in any way, nor shall the rights of any person involved in or affected by the dispute be prejudiced by the fact that normal work has continued without interruption.

vii. The objectives of the procedure shall be to promote the resolution of disputes by measures based on consultation, co-operation and discussion, to reduce the level of industrial confrontation, and to avoid interruption to the performance of work and the consequential loss of production and wages in accordance with the Fair Work Act 2009.”

[103] There is no dispute between the parties that the Commission has jurisdiction to determine the questions posed.

[104] I am well satisfied that the subject matter of the dispute (ASC Policy concerning COVID-19) is a matter which has arisen “within the Company” within the meaning of cl 13(a)(i) of the Agreement and that the dispute is a “matter under this Agreement”, raising as it does ASC’s consultation obligations under cl 5, 36 and 41(a).

[105] Seized of jurisdiction, I proceed to determine the dispute.

[106] Before doing so it is appropriate to refer to the approach I intend to take to one aspect of the evidence. In this matter, albeit for different reasons, both the Unions and ASC have led evidence concerning, and rely upon, matters arising since the applications were filed in December 2021. For example, the Unions submit that the easing of public health restrictions in the first half of 2022 support its contention that ASC’s vaccination mandate is, at least now, an unreasonable and disproportionate response. For its part, ASC submit that consultation it conducted in the first quarter of 2022 is relevant to determining whether it met its consultation obligations.

[107] I accept that in the context of determining a dispute under s 739 of the FW Act, events which transpire since a dispute was first notified may be relevant and capable of forming a basis for decision, provided an appropriate body of evidence is adduced to support findings or conclusions. Whilst the Commission can only determine a dispute within the parameters of the initiating application(s) before it, evidence of events (whether continuing or stand-alone) in support of or against the grounds on which on application is made is capable of informing the arbitrated settlement.

[108] This approach recognises that the Commission, in its dispute settlement jurisdiction, deals with the real world of industrial relations where some disputes have a changing or continuing character and where decisions can have prospective effect. The Commission is not in all cases ruling on a static state of affairs or necessarily adjudicating past rights and obligations.

Has ASC Pty Ltd met the consultation requirements prescribed by the ASC Pty Ltd Enterprise Agreement 2021 (Agreement) in respect of its COVID-19 Vaccination Policy?

Construction of enterprise agreements

[109] To the extent this question bears on construction of the Agreement, it is appropriate to outline key principles.

[110] Principles for construction of enterprise agreements are well established. Interpretation of the instrument should be founded on language used in light of the Agreement read as a whole and its industrial, commercial and legislative context and purpose. 30

[111] These principles reject “narrow or pedantic approaches” and recognise that those who draft such provisions are likely to have “a practical bent of mind” and have been “more concerned with expressing an intention in ways likely to have been understood in the context of the relevant industry and industrial relations environment than with legal niceties or jargon.” 31 As stated by the Full Court of the Federal Court:32

“Words are not to be interpreted in a vacuum divorced from industrial realities but in the light of the customs and working conditions of the particular industry.”

[112] Surrounding circumstances (drawn from objective background facts including the industrial context known to the ‘parties’) can inform the interpretation of an Agreement; for example, where there are equally open alternate interpretations of its terms or where the language used is ambiguous. 33 Surrounding circumstances may include relevant history of the disputed provisions:34

“Recourse may be had to the history of a particular clause “where the circumstances allow the court to conclude that a clause in an award is the product of a history, out of which it grew to be adopted in its present form …”

[113] Further, all words in an enterprise agreement must prima facie be given some meaning and effect. 35 The construction should “contribute to a sensible industrial outcome” and one “that will operate fairly towards both parties.”36

[114] However, the task of the Commission is not to rewrite or reframe the Policy intent of an industrial instrument. 37 It is a narrower undertaking: to interpret an Agreement according to its language consistent with these canons of construction.

The consultation obligations

[115] The Unions submit these obligations arose under cl 5 and 36 of the Agreement and ss 46, 47, 48 and 49 (consultation) and ss 77 and 79 (Work Health and Safety Committees) of the Work Health and Safety Act 2012 (SA) (WHS Act).

[116] The Unions submit ASC failed to meet these obligations.

[117] Clauses 5 and 36 of the Agreement provide:

“5. PREAMBLE – OBJECTS OF AGREEMENT

The parties are committed to continually developing and maintaining an internationally and nationally competitive company.

It is recognised by the parties that ASC must continue to achieve a substantial increase in its overall efficiency to meet its contractual requirements to the Commonwealth in a competitive environment. Programmed or early completion of all tasks will establish a foundation for future work, and ASC’s ongoing viability. The parties understand this will be achieved via:

•  Greater productivity and flexibility;

•  Enhanced job satisfaction;

•  Improved performance in the workplace;

•  Better pay;

•  Greater communication;

•  Improved safety standards;

•  Improved customer satisfaction.

The parties commit themselves to achieve a competitive advantage based on the utilisation of high skills, effective utilisation of technology and effective teamwork and flexibility. There will be a high level of cooperation between production employees and management at all levels to enable production to flow freely and efficiently. Change in the workplace and varying market opportunities will be embraced to ensure ASC is, and remains, internationally competitive. ASC also recognises the importance to employees of security of employment.

The parties agree that material changes to employment policies will only be made following appropriate consultation with employee representatives. Any such changes will not diminish existing entitlements as applying from the date of certification of this Agreement.

(…)

36. JOINT CONSULTATIVE COMMITTEE

a. Objectives of the Joint Consultative Committee

i. To achieve and maintain good employee relations by way of joint consultation between the Company and employees on matters which have the potential to interfere with good industrial relations.

ii. To promote mutual understanding and goodwill between the Company and its employees.

iii. To discuss issues within the Company's operation which require attention and to work cooperatively to find solutions to such problems or issues.

iv. To assist in the resolution of disputes or grievances in accordance with the procedure set out in Clause 13 (Avoidance of Industrial Disputes).

b. Composition of Joint Consultative Committee

There shall be a Joint Consultative Committee which shall include the following representation:

i. Up to six management representatives including the Production Manager or their nominee and up to six employee representatives. Such employee representatives (delegates and/or proxies) who shall be duly elected by the employees.

c. Frequency of Meetings

The Committee shall meet once per month except that matters of an urgent nature may be discussed by a specially convened meeting.

d. Conduct of Meetings

Chairmanship of the Joint Consultative Committee shall initially be undertaken by one of the Management representatives. Thereafter the Chairmanship shall rotate between representatives of the employees and representatives of management, unless the members on the Committee agree otherwise, on a six monthly basis.

e. Confidentiality

The parties to this Agreement recognise that certain information to be dealt with by the Joint Consultative Committee may be commercially sensitive or subject to security restriction. All parties maintain that they will respect the sensitivity of such material and acknowledge that some material presented at Committee meetings might need to be returned prior to or at the conclusion of that meeting.

f. Methods of Communicating

The Committee shall devise methods of communication to all employees of the Company of its deliberations.

g. Transfer of Labour

The transfer of labour to meet Production requirements will be initiated by management. Once identified, the labour transfer (permanent, not loan) will be facilitated by e-mail from management to relevant supervision, requesting that a copy of the e-mail be given to each person listed for transfer.”

[118] Clause 41(b) of the Agreement provides:

“41. WORK HEALTH, SAFETY AND WELFARE

(…)

b. Compliance

The Company will at all times seek to maintain a safe and hazard free workplace and to comply with relevant Workplace Health and Safety Legislation.”

[119] On consultation, ss 46, 47, 48 and 49 of the WHS Act provide:

“46—Duty to consult with other duty holders

If more than one person has a duty in respect of the same matter under this Act, each person with the duty must, so far as is reasonably practicable, consult, co-operate and co-ordinate activities with all other persons who have a duty in relation to the same matter.

Maximum penalty:

(a) in the case of an individual—$20 000;

(b) in the case of a body corporate—$100 000.

47—Duty to consult workers

(1) The person conducting a business or undertaking must, so far as is reasonably practicable, consult, in accordance with this Division and the regulations, with workers who carry out work for the business or undertaking who are, or are likely to be, directly affected by a matter relating to work health or safety.

Maximum penalty:

(a) in the case of an individual—$20 000;

(b) in the case of a body corporate—$100 000.

(2) If the person conducting the business or undertaking and the workers have agreed to procedures for consultation, the consultation must be in accordance with those procedures.

(3) The agreed procedures must not be inconsistent with section 48.

48—Nature of consultation

(1) Consultation under this Division requires—

(a) that relevant information about the matter is shared with workers; and

(b) that workers be given a reasonable opportunity—

(i) to express their views and to raise work health or safety issues in relation to the matter; and

(ii) to contribute to the decision-making process relating to the matter; and

(c) that the views of workers are taken into account by the person conducting the business or undertaking; and

(d) that the workers consulted are advised of the outcome of the consultation in a timely manner.

(2) If the workers are represented by a health and safety representative, the consultation must involve that representative.

49—When consultation is required

Consultation under this Division is required in relation to the following health and safety matters:

(a) when identifying hazards and assessing risks to health and safety arising from the work carried out or to be carried out by the business or undertaking;

(b) when making decisions about ways to eliminate or minimise those risks;

(c) when making decisions about the adequacy of facilities for the welfare of workers;

(d) when proposing changes that may affect the health or safety of workers;

(e) when making decisions about the procedures for—

(i) consulting with workers; or

(ii) resolving work health or safety issues at the workplace; or

(iii) monitoring the health of workers; or

(iv) monitoring the conditions at any workplace under the management or control of the person conducting the business or undertaking; or

(v) providing information and training for workers; or

(f) when carrying out any other activity prescribed by the regulations for the purposes of this section.”

[120] On Health and Safety Committees, ss 77 and 79 of the WHS Act provide:

“77—Functions of committee

The functions of a health and safety committee are—

(a) to facilitate co-operation between the person conducting a business or undertaking and workers in instigating, developing and carrying out measures designed to ensure the workers' health and safety at work; and

(b) to assist in developing standards, rules and procedures relating to health and safety that are to be followed or complied with at the workplace; and

(c) any other functions prescribed by the regulations or agreed between the person conducting the business or undertaking and the committee.

(…)

79—Duties of person conducting business or undertaking

(1) The person conducting a business or undertaking must allow each member of the health and safety committee to spend the time that is reasonably necessary to attend meetings of the committee or to carry out functions as a member of the committee.

Maximum penalty:

(a) in the case of an individual—$10 000;

(b) in the case of a body corporate—$50 000.

(2) Any time that a member of a health and safety committee spends for the purposes set out in subsection (1) must be with the pay that he or she would otherwise be entitled to receive for performing his or her normal duties during that period.

(3) The person conducting a business or undertaking must allow the health and safety committee for a workplace to have access to information that the person has relating to—

(a) hazards (including associated risks) at the workplace; and

(b) the health and safety of the workers at the workplace.

Maximum penalty:

(a) in the case of an individual—$10 000;

(b) in the case of a body corporate—$50 000.

(4) Despite subsection (3), the person conducting a business or undertaking must not allow the health and safety committee to have access to any personal or medical information concerning a worker without the worker's consent unless the information is in a form that—

(a) does not identify the worker; and

(b) could not reasonably be expected to lead to the identification of the worker.

Maximum penalty:

(a) in the case of an individual—$10 000;

(b) in the case of a body corporate—$50 000.”

Principles concerning consultation

[121] Whilst consultation obligations in an industrial instrument are to be interpreted and applied according to their language and context, a number of principles have been expressed to guide decision-making by the Commission.

[122] Consultation should be meaningful and engaged in before an irreversible decision has been made. Consultation should not be perfunctory. It has been said that the obligation will only be met where a party has a real opportunity to influence the decision maker. 38 The obligation will not generally be met where the party upon whom the obligation rests treats the implementation of a proposal as a fait accompli, with only the details or program for implementation left for discussion.39 Consultation is not merely about the impact of a decision and means to mitigate the impact, but about the decision itself.40

Did ASC meet its consultation obligations?

[123] I deal firstly with the consultation obligations under cl 5, 36 and 41(a) of the Agreement.

[124] I have found that on or about 10 November 2021 ASC via its Executive proposed a COVID-19 Policy that included immediate control measures (phase 1) and a later mandatory double vaccination requirement. Phase 1 was proposed to operate from 1 December 2021 and phase 2 from 28 March 2022.

[125] ASC made that announcement on 23 November 2021 and immediately commenced a process of consultation with employees and their representatives. Consultation on phase 1 was proposed to close on 29 November 2021 and consultation on phase 2 was proposed to close on 15 December 2021.

[126] Consultation initially focussed on phase 1. Once the consultation period closed on 29 November 2021 ASC decided to proceed with phase 1 with a delayed commencement and some modifications. Phase 1 (as modified) commenced on 6 December 2021. ASC continued to respond to issues raised by Unions and employees beyond the consultation and implementation date. For example, on 6 December 2021, following a meeting with the Unions, ASC agreed that evidence of a medical exemption to the mask wearing requirement could be provided up to 9 December 2021.

[127] Phase 2 proposed a first vaccination by 24 January 2022 and a second vaccination by 28 March 2022, following which the Policy would be enforced. The proposed consultation period on phase 2 was extended from 15 to 21 December 2021. On 22 December 2021 ASC advised the Unions and employees that it intended to proceed with phase 2.

[128] As phase 2 remained a disputed matter, and following conferences in the Commission, consultation on phase 2 extended into January, February and March 2022. Consultation occurred on phase 2 both at the workplace level and in the Commission (including under the auspices of the dispute notified by the Unions on 8 and 10 December 2021).

[129] ASC (via a subset of the Executive) reviewed whether to proceed with phase 2 on the weekend of 5 and 6 March 2022, three weeks prior to implementation. The following day, 7 March 2022, the Executive decided to proceed to implement the vaccination mandate from 28 March 2022.

[130] The Union submissions alleging unlawfulness based on consultation obligations boil down to three main contentions.

Was the decision irrevocable?

[131] Firstly, the Unions submit that the decision when announced on 23 November 2021 was definitive such that subsequent discussion with Unions, delegates and employees was not consultation as required by law.

[132] On an overall consideration of the evidence I do not agree.

[133] The decision to introduce a vaccination mandate was made by the Executive at a meeting on or about 10 November 2021. Unhelpfully, the decision was not minuted; there is no contemporaneous record of its terms.

[134] The decision was variously described by ASC over the following weeks as both a “decision” and a “proposed decision”.

[135] Applying dual nomenclature was, at the very least, confusing. It was described in a way that conveyed both an impression of being definitive and an impression that it was negotiable. Coupled with the fact that the decision was unexpected (given ASC’s indication a month earlier that mandating vaccination was not the company’s then intention), the dual nomenclature gave rise to a reasonable belief on the part of the Unions, JCC members and HSRs (who had no prior notice of the decision) that it was definitive. This combination of surprise and dual nomenclature contributed to a difficult industrial issue for both the business and the Unions being the subject of dispute within days.

[136] The reality was somewhat, but not entirely, different. It was not entirely different because ASC’s decision was a decision to implement a mandate, and to do so on proposed terms and from proposed dates. In making the decision it announced on 23 November 2021, ASC had crossed a threshold of believing that mandating vaccination at its worksites was a necessary response to changed circumstances (Navy requirements, border opening and likely community transmission including at its worksites).

[137] However the reality also was that ASC’s decision was a proposed decision in the sense that that it was to be the subject of consultation. The operative dates were prospective, allowing for short periods of consultation and staged implementation.

[138] The agreed facts themselves refer to both “the proposed Policy” (paragraph 25) and “the “Policy” (paragraph 26).

[139] The CEO’s video of 23 November 2021 described the decision as “a decision to introduce mandated COVID-19 vaccines at ASC”. Later in the video Mr Whiley stated “we are not planning (sic) implement this decision straight away, we will undertake a consultation period to give you the opportunity to ask questions, provide feedback and talk to us about your individual situations.” Considered alone, the video generally conveyed an impression that the decision was definitive with consultation only on implementation, not the decision to mandate.

[140] However, it would be wrong to view the video in isolation. The communication pack released that same day described the Policy as:

“Proposed Changes to COVID-19 Policy and Roadmap” 41 (my emphasis).

[141] In the body of the communication pack, ASC advised:

“we are intending to implement changes to our COVID-19 controls and policies” 42 (my emphasis).

[142] The Communication Pack included a “roadmap” that ended with a second vaccination requirement by 28 March 2022. It advised employees: 43

“CONSULTATION PERIOD

ASC are providing all employees the opportunity to provide feedback or seek clarification via email to COVID@asc.com.au. As such we have commenced a consultation process which will be open until:

29 November 2021 for feedback relating to Phase 1

15 December 2021 for feedback relating to Phase 2”

[143] In evidence, Mr Whiley referred to the 10 November 2021 decision as a “decision to implement a proposal and to then go into consultation with our workforce about that proposal”. 44 Ms Horne in her evidence referred to it as a decision “to propose and to enter into a consultation process on a vaccine.”45 Each are fair characterisations of what was decided.

[144] Ms Horne, whose evidence I found credible and consistent under cross examination, expressly rejected the proposition that the decision was irrevocable: 46

“Mr Dean: So you reject the proposition that it was a firm or final decision,. You say it was to be the subject of consultation?

Ms Horne: Yes definitely.”

[145] An exclusive focus on nomenclature is an incomplete basis on which to assess whether the decision was definitive. Conduct is also relevant. It too informs the character of the decision.

[146] ASC designed a plan for consultation in the days prior to making the 23 November 2021 announcement. The plan involved consultation not just with employees, but also union delegates and union officials.

[147] I have found that ASC implemented its consultation plan from 23 November 2021. It was not an after-thought or hastily convened in the wake of subsequent events such as objection by the unions or delegates, the two dispute notifications or the Commission’s full bench decision in Mt Arthur Coal on 3 December 2021.

[148] ASC consulted on the decision, the details of which are extensively referenced in the evidence of Ms Horne and Mr Stocks. As a consequence of that consultation ASC extended (albeit only briefly) the consultation period for phase 2, made changes to some terms of phase 2 (such as requiring proof but not holding evidence of vaccination), consulted further during January and February 2022, agreed to consider a review of the risk assessment by HSRs, and three weeks prior to implementation reviewed whether it was appropriate to proceed with that measure.

[149] I have found that ASC exchanged correspondence and held discussions and meetings with the Unions, JCC members and HSRs on the Policy following the 23 November 2021 announcement. These exchanges were both formal and informal. ASC received and was generally responsive to issues raised by the Unions and delegates, both orally and in writing. The evidence of Mr Schuit and Mr Gordon, and Mr Stocks in particular, highlight the extent and ongoing nature of those exchanges. ASC also invited, received and considered feedback from individual employees. It did so on phase 1 and phase 2 measures.

[150] The consultation planned and then undertaken was consistent with a conclusion that the decision announced on 23 November 2021 was proposed but not definitive. It was a proposed decision in the sense that that it was to be the subject of consultation.

[151] Did that consultation have the capacity to inform and impact the employer’s view on the appropriateness of its decision to introduce a vaccination mandate?

[152] For the following reasons, and whilst ASC had a predisposed view to the appropriateness of its decision, I conclude that it did.

[153] Aside from making some changes to phase 1 measures, ASC made a material change to phase 2 measures. As noted, it decided to require but not hold proof of vaccination. This was a change not at ASC’s initiative but as a result of consultation.

[154] I have also found that, at the request of the Unions and delegates, in January 2022 ASC facilitated the opportunity for JCC members and HRS’s to review ASC’s risk assessment and develop one of their own. ASC also agreed to conduct State-based risk assessments.

[155] In an email sent to JCC members and HSRs on 13 February 2022 Mr Stocks of ASC stated that: 47

“we will be including an additional option for consideration which would be characterised as ‘non-mandate, heightened controls including ongoing RA testing process’. While there is already an option of non-mandate and heightened controls for non-vaccinated, I think this more clearly describes the option that we’ve been asked to consider.”

“The type of assessment we are completing is an option risk assessment to help decision makers decide on the most appropriate course of action. In this case, it is used to help inform the COVID policy decisions. Once we have completed the update to the assessment we will forward the assessment to the Executive COVID Committee who will review and determine whether the assessment justifies a change in the current policy.”

[156] Mr Schuit, an AWU delegate and member of the JCC and a HSR put it this way in his evidence: 48

“We asked the company if we could review the risk assessment…and the company did agree to it… and we took that on board as being from the 7th of the 2nd as being the first meaningful consultation on this matter…the risk assessment was reviewed by the HSRs.”

[157] The work by the JCC and HSRs was completed on 17 February 2022. The HSRs risk assessment was provided to the Executive sub-group. Mr Stocks kept JCC members and HSRs informed of the progress in the period between 17 February 2022 and 6 March 2022 49.

[158] Mr Whiley attended the Executive sub-group meetings on 5 and 6 March 2022. Mr Stocks was not a member of the Executive and Ms Horne was absent on parental leave. Although Mr Whiley’s evidence on this point was somewhat unclear, I find on the balance of probabilities that the JCC and HSRs risk assessment informed, albeit in small part only, the review conducted by the Executive sub-group on 5 and 6 March 2022:

In cross examination: 50

“Mr Whiley: We did analysis. We produced some updated data. We pulled all the situation, constraints, environment, the reality. We brainstormed it in a manner to get some clarity on the way ahead.

Mr Dean: What material did you have before you on the 5, 6 and 7th in terms of feedback from the workforce?

Mr Whiley: I had no specific feedback on that analysis.”

In re-examination: 51

“Mr Vallence: Did you consider a risk analysis that had been prepared by the HSR group as part of your deliberations?

Mr Whiley: It was discussed. I didn’t see the risk analysis. We had a person from our risk group provide some analysis against that work. It was considered in the discussion.”

[159] Across 5 and 6 March 2022 the Executive sub-group reviewed whether to proceed to implement the vaccination mandate from 28 March 2022. It did so in light of feedback received and its further consideration of risk, the then state of affairs concerning the virus and levels of vaccination across its workforce. This was a genuine weekend-long review of the company position. It was not simply a review of dates or the terms of implementation, but whether the mandate itself should proceed. The company considered, after months of feedback, the disputed opinions and changing circumstances, whether it was taking the appropriate course. The contested views of the JCC, HSRs and some employees informed, albeit to a limited extent only, that re-consideration.

[160] That the Executive the following day (7 March 2022) decided to proceed with the Policy and its implementation from 28 March 2022 is not evidence that consultation had not occurred or that which had occurred had not been capable of affecting the company’s decision to proceed.

[161] Considered overall, I conclude that the steps taken by ASC between 23 November 2021 and 28 March 2022 met its consultation obligations under the Agreement. ASC had a predisposed view in favour of the decision it had made but was willing to, and did consider views which questioned the need for the vaccination mandate. It did so in the context of also receiving views on the other elements of the Policy (conditions and timing).

[162] I take into consideration that this consultation occurred in a narrow context. It was not consultation on one of a series of open or neutral options. It was consultation on ASC’s decision to introduce control measures to be followed by a double vaccination mandate. At the time of its announcement and in the weeks that followed, ASC gave no sign that the company may not proceed with its decision to mandate vaccination. In that sense, if the decision was to change, ASC would need to be persuaded not to do what it had decided should be done.

[163] However, having a predisposed view to a particular course rather than simply opening discussion on neutral options is not, of itself, a failure to consult provided the necessary ingredients exist that meet minimum consultation obligations. Context and the nature and circumstances of each case matter, meaning that what will amount to ‘consultation’ has an inherent flexibility 52.

[164] In this instance, ASC was managing health risks arising from a new virus that had generated a global pandemic. This required leadership not just from governments but from the corporate sector meeting its obligations to pro-actively manage workplace risk. Holding a predisposed view to a particular course once it assessed risk in November 2021, and holding to that view during the subsequent period of consultation, did not mean that the consultation was not genuine and meaningful. Whether other or different approaches to decision-making and consultation could or should have been taken by ASC is not to the point.

[165] ASC did not close off consideration of contrary views. It decision was contemporaneously accompanied by a desire to consult and receive feedback. It did consult and receive that feedback. It did open its mind to whether to proceed to implement phase 2. On at least two occasions during the consultation period (21 December 2021 and then 7 March 2022) ASC reviewed its position and decided to proceed with phase 2.

[166] Considered overall, whilst ASC remained predisposed to the appropriateness of the mandate it had decided upon in November 2021, I do not conclude that ASC’s decision was irrevocable. Consultation had the capacity to inform and impact the employer’s view on the appropriateness of its decision and whether to proceed with that decision.

[167] It is well established that the obligation to consult does not equate to an obligation to agree to alternate positions or views. 53

[168] The cl 5 consultation obligation is that “material changes to employment policies will only be made following appropriate consultation with employee representatives”. ASC’s COVID-19 Policy announced on 23 November 2021 was “a material change to employment policies”. However, it was a Policy change made subject to consultation. That consultation occurred. Consultation covered the terms of the Policy, its implementation, and whether it should proceed.

[169] Whilst consultation occurred in a variety of forums, two such vehicles were the JCC and HSRs. ASC met its obligations under cl 36 of the Agreement.

[170] Nor did ASC fail to meet its obligation under cl 41(b) of the Agreement. The Policy was introduced and both phases were subsequently implemented in order to mitigate health and safety risks associated with COVID-19 and its potential transmission across the ASC workforce.

[171] I also consider ASC’s conduct to have been consistent with its consultation obligations under the WHS Act, involving, as it did, employee and health and safety representatives recognised by that Act. Whilst consultation was somewhat haphazard given the interventions by third parties (the Commission, SafeWork SA and Comcare), and could have been more extensive on the threshold question of whether a mandate was necessary, in the context of the matters at hand ASC met the minimum statutory threshold of consulting as far as was reasonably practicable.

Was consultation triggered only by subsequent dispute notifications?

[172] Secondly, the Unions submit that meaningful consultation only occurred in the wake of disputes being notified in the Commission and after a decision had been made to introduce a vaccination mandate.

[173] The Unions notified disputes in the Commission on 8 and 10 December 2021, and conferences were conducted in the Commission across two periods – in December 2021 (15 and 20 December) and in March 2022 (17, 21, 24 and 25 March 2022).

[174] Whilst in both periods the Commission encouraged dialogue at a workplace level, and whilst it is open to conclude that the dispute notifications and subsequent role of the Commission provided an intensity and focus to the consultation process on phase 2, that process was in train before the dispute notifications were lodged. Consultation was not forced on ASC by third parties.

[175] For example, as is readily apparent from the evidence of Mr Stocks and Ms Horne, between 23 November 2021 and 29 November 2021, ASC supplied information to union officials and employee representatives and held meetings with JCC members and meetings with the HSRs to discuss the proposed Policy and COVID-19 controls. ASC also approved union meetings, including a lunch time meeting by the AMWU on 25 November 2021, which was followed by a later meeting with ASC to receive feedback from the AMWU.

[176] Between 6 December 2021 and 20 December 2021, ASC engaged in further consultation with employees and their representatives including meetings with JCC members and HSRs and approval of paid meetings for union officials and representatives to meet with their members to provide feedback on the Policy.

[177] I take into account that it was not until February 2022 that union delegates and HSRs, having been given the ‘green light’ on 25 January 2022 to submit their own risk assessment, felt that ASC had opened the door to not proceeding with its decision to introduce and enforce a vaccination mandate. Whilst that opening had not emerged in such plain terms until that time, consultation had commenced prior to that date.

[178] The HSRs February 2022 risk assessment supported control measures but not mandatory vaccination. Two weeks later ASC advised that its assessment of risk would stand and the vaccine mandate would be implemented.

[179] Not surprisingly this led to the Unions re-agitating their already notified dispute in the Commission, and ultimately these proceedings.

Failure to consult before 23 November 2021

[180] Thirdly, the Unions submit that ASC failed to meet its consultation obligations because it failed to consult with the Unions, JCC members or HSRs in advance of announcing its decision to the workforce on 23 November 2021.

[181] This submission would have force if the decision as announced was not made subject to consultation or was definitive when made. I have not so found.

[182] No doubt the Unions and HSR delegates were taken aback by the announcement. They had no prior warning. Until then, their understanding was that ASC did not support the mandating of vaccines. As I have found, as recently as October 2021 ASC had advised its workforce of that position. However, as I have also found it was only two weeks prior to the announcement that ASC formed a different view. ASC’s thinking changed, influenced as it was by the then move by some States to open borders and its assessment of risk, and the off-shore requirements of the Navy.

[183] The Unions correctly submit that ASC could have but did not discuss its change of mind with the JCC or HSRs prior to the 23 November 2021 announcement.

[184] For two reasons I do not consider this to be a basis for finding that ASC breached its consultation obligations. Firstly, the decision that was made was made subject to consultation. Secondly, ASC made the decision to consult in this way after giving the issue strategic thought. In cross examination, Ms Horne put it this way: 54

“When we considered the way that we would propose this policy there were two ways we could do it. We could engage with HSRs, JCC members etc and do it that way or we could do it the way that we did it, which was to try to come up with as much information as possible as to how we thought it would work and then put that to the workforce and propose a consultation period. Our experience with COVID was that it was a very personal topic, it was a very emotional topic…and there would be a wide ranging level of emotion and sometimes that would actually create a little bit of conflict between our employees. So we decided that the best thing we could do was put down what we thought the right steps to take to be and put it to our employees and then go through the consultation process, and that’s why we made the decision to do it that way.”

[185] I do not find that ASC unduly delayed informing the unions of its changed position. The Executive used the two week period 10 to 23 November 2021 to inform relevant arms of management (such as Mr Stocks) and have Mr Stocks prepare a consultation plan. Other arms of management prepared the communication pack and video. To meaningfully consult on its proposal, it was reasonable for ASC to undertake this work.

[186] Union delegates were informed of the proposal and ASC’s consultation plan in conjunction with employees being informed. There was no breach of consultation obligations in so doing.

[187] Even if I am wrong in my conclusion that ASC did not fail to meet its consultation obligations by not consulting prior to 23 November 2021, I consider that the consultation which occurred in the weeks and months that followed was material and remediated, for the purpose of settling this dispute, any failure to consult prior to 23 November 2021.

[188] For the aforementioned reasons, I conclude that whilst consultation undertaken by ASC occurred on multiple fronts and was somewhat haphazard, and whilst ASC had a predisposed view during consultation to the decision it had made to introduce a vaccination mandate, ASC materially complied with its consultation obligations under both the Agreement and the WHS Act.

[189] The answer to the first question is yes.

Would an instruction from ASC Pty Ltd that employees covered by the Agreement comply with the COVID-19 Vaccination Policy be a reasonable and lawful instruction?

[190] The Unions submit that the phase 2 of the Policy is both unlawful and unreasonable.

Principles concerning lawfulness

[191] For a direction by an employer to be lawful it must at least pertain to employment (that is, be within the scope of the employment relationship) 55 and must not be to do with something which is unlawful.

[192] Where, as in this case, an employer requires compliance with a direction that is not the exercise of statutory power, the authority to issue that direction is not derived from the WHS Act nor the Agreement, but from the exercise of an implied contractual power to direct. 56

Lawfulness – Consultation

[193] I have concluded that ASC materially complied with its consultation obligations under both the Agreement and the WHS Act.

[194] A direction to comply would thus be lawful.

[195] Given this conclusion, it is unnecessary to decide whether a Policy in breach of a term of an industrial instrument (such as the Agreement) or WHS Act is necessarily void or a direction to comply necessarily unlawful. These questions are expressly left open by the Commission decision in Mt Arthur Coal and need not be decided in this matter.

Lawfulness – Privacy Act 1988

[196] The Unions contend that the Policy is unlawful in that it contravenes the Australian Privacy Principles (APP) in Schedule 1 of the Privacy Act 1988. In particular the Unions contend that the collection and retention by ASC of data concerning an employee’s vaccination status is not consensual because “the threat of termination vitiates the required free consent”. 57

[197] APP 3.3, which relates to sensitive information, provides as follows:

“3.3 An APP entity must not collect sensitive information about an individual unless:

(a) the individual consents to the collection of the information and:

(i) if the entity is an agency—the information is reasonably necessary for, or directly related to, one or more of the entity’s functions or activities; or

(ii) if the entity is an organisation—the information is reasonably necessary for one or more of the entity’s functions or activities; or

(b) subclause 3.4 applies in relation to the information.”

[198] As noted, as a consequence of consultation, on 20 December 2021 ASC varied the proposed Policy to not require the supply and retention of vaccination certificates. The Policy in the form adopted provides:

“Existing employees must provide ASC with evidence of their full vaccination status before 28 March 2022, with their first dose administered prior to 24 January 2022. After these dates, new employees will be asked to provide evidence of their vaccination status before commencing with ASC.

Employees should email or show evidence of their vaccination status to the relevant Health Centre in each state or provide a hard copy. No copies will be saved on file, however for specific customer or legal requirements, a copy may be required to be maintained by ASC.

By providing vaccination information or medical evidence, each employee consents to ASC’s collection and use of this information in accordance with this Policy. ASC maintains record keeping and information sharing procedures with the aim of ensuring that all records are stored and handled securely in line with the Privacy Act 1988 and in accordance with its Privacy collection statement.”

[199] On compliance, the Policy provides, at part 4, that:

“Employees who fail and/or refuse to provide proof of vaccination by the required timeframe will be unable to enter an ASC Facility and ASC will commence a process to determine next steps. If all avenues are exhausted this may result in the termination of the individual’s contract of employment.”

[200] ASC is “an APP Entity” required to comply with the Australian Privacy Principles.

[201] Does the potential termination of employment for failing to meet the obligation to provide evidence of vaccination or medical exemption vitiate the consent required by APP 3.3(a)?

[202] In the circumstances, I think not.

[203] It was observed in Mt Arthur Coal that a requirement, enforceable by potential termination for non-compliance, that an employee be vaccinated or produce an exemption to access a work site does not constitute coercion in the legal sense but is nonetheless a form of economic and social pressure relevant to reasonableness. 58

[204] In Construction, Forestry, Maritime, Mining and Energy Union & Ors v BHP Coal Pty Ltd T/A BHP Billiton Mitsubishi Alliance/BMA & Ors (Mitsubishi) 59 Deputy President Asbury, referring to the NSW Supreme Court decision in Kassam v Hazzard60 stated:

“[169]…The effect on a construction worker of being prevented from working on a particular site, because of a choice not to be vaccinated, is analogous to the effect on employees who face termination of their employment for non-compliance with a direction to establish their vaccination status before entering the site…”

[170]…If economic and social pressure created by the Mt Arthur Coal SAR is not coercion in the legal sense for the purposes of the right of employees to bodily integrity, pressure of the same kind created by the SAR in the present case, is not coercion that vitiates consent of employees to provide sensitive information to establish vaccination status.”

[205] The Unions rely on the decision of the Commission in Lee v Superior Wood Pty Ltd 61, a matter concerning a direction of an employer to provide biometric data on pain of termination or disciplinary consequence.

[206] Whilst the requirement of free consent is a constant where the APP apply, each case turns on its own facts in order to determine whether consent exists or is vitiated. For reasons expressed in Mitsubishi and which need not be repeated 62, I consider that Lee v Superior Wood is distinguishable from a situation, as in the present, where the direction is readily capable of compliance, has been introduced following consultation, and the Privacy Act requirements are otherwise met.

[207] I am also satisfied that the information required by ASC (showing proof of vaccination or medical exemption) “is reasonably necessary for one or more of the entity’s functions or activities”, being the implementation of workplace policies in active compliance with its health and safety obligations under the Agreement and the WHS Act.

[208] I do not conclude that the Policy, providing as it does that a person “consents to ASC’s collection and use of this information in accordance with this Policy” upon presentation of the required proof of vaccination or medical exemption, is inconsistent with the APP.

[209] That being so, I do not conclude that a direction to comply with the Policy is unlawful on that ground.

[210] Given this conclusion, it is unnecessary to decide whether the exemption in clause 3.4 of the APP applies 63, or whether a Policy in breach of the Privacy Act is necessarily void or a direction to comply necessarily unlawful. These questions are expressly left open by the Commission decisions in Mt Arthur Coal and Mitsubishi.

Conclusion on lawfulness

[211] Noting that the Commission has no jurisdiction to finally determine legal rights but can, in the settlement of disputes express opinions on legal questions 64, for the aforementioned reasons, I conclude that phase 2 of the ASC Policy (mandatory vaccination) is not unlawful.

Reasonableness

Principles concerning reasonableness

[212] The general approach adopted by the Commission to assessing the reasonableness of an employer’s direction to employees was succinctly expressed in the XPT Case: 65

“It seems to us that the proper test to be applied and which has been applied for many years by the Commission is for the Commission to examine all the facts and not to interfere with the right of an employer to manage his own business unless he is seeking from the employees something which is unjust or unreasonable.”

[213] I apply that approach to this matter.

[214] There are two grounds on which ASC’s Policy on mandatory vaccination is said to be unreasonable.

Sufficiency of control measures

[215] Firstly, the Unions contend that the vaccination mandate is unnecessary because phase 1 control measures are sufficient to manage health and safety risks presented by COVID-19.

[216] Phase 1 control measures included mask wearing, social distancing and rapid antigen testing on site.

[217] The challenge to reasonableness on this ground is not made out. That a measure or combination of measures in mitigation of risk may have meaningful effect does not mean that a different or more stringent measure is unreasonable or unnecessary. The evidence before me is that work on submarines includes work in confined spaces where social distancing is not always possible let alone observed. The evidence also is that mask wearing is only as effective as the level of compliance, that non-compliance occurs from time to time and that this creates risk. The evidence is also that rapid antigen testing on site entry occurs only weekly, meaning that the virus can be transmitted unknowingly by an asymptomatic employee on days when they attend the site but are not tested.

[218] In these circumstances it was reasonable for ASC to conclude that phase 1 controls, whilst important, were not adequate to mitigate its assessment of risk.

Proportionality to risk

[219] Secondly, the Unions contend that the Policy requiring mandatory vaccination is disproportionate to the current risks presented by COVID-19.

[220] This is a substantive matter and one on which this decision turns.

[221] In advancing this submission, the Unions submit that the Commission should consider not just risk presented at the time the Policy was announced (23 November 2021) or the time the mandatory vaccination requirement was implemented (28 March 2022) but at the time of taking evidence at the hearing of this matter. The Unions submit that circumstances have changed over the past six months such that a mandatory vaccination Policy, even were it reasonable in November 2021 (which is contested), is not reasonable now.

[222] In particular, the Unions contend that since the dispute was notified the case for ASC mandating vaccination has weakened having regard to:

•  the increased and now high vaccination rates in the general Australian and South Australian population;

•  the increased and now high vaccination rates amongst the ASC workforce including persons employed under the Agreement;

•  that the Omicron variant of COVID-19 is less severe and has resulted in less hospitalisations than previous variants notwithstanding that it is transmissible and can result in serious illness or death;

•  the opening of domestic borders by the South Australian government in November 2021 and December 2021 and the reciprocal opening of borders to other States;

•  the progressive opening of international borders by the Australian government permitting entry to Australia from overseas; and

•  the general easing of public health restrictions by the government of South Australia during 2022 including the expiry of public health mandates requiring vaccination in certain settings, easing of restrictions such as mask wearing and density limits, and the revocation of the Emergency Management declaration.

[223] The Unions submit that the increased vaccination rates and easing of restrictions, together with the fact that ASC worksites have not been regulated by public health orders mandating vaccination and that a vaccination mandate applies pressure to some employees “to surrender their bodily integrity in circumstances where they would prefer not to do so” 66 now “tip the balance in favour of their position”67 that the phase 2 vaccination mandate is unreasonable.

[224] Conversely, ASC contend that its vaccination announcement of 23 November 2021 was reasonable, and that since that time the case for implementing the Policy has strengthened, not diminished, having regard to:

•  increased risk of transmission and incidence of COVID-19 in the general community consequent on the opening of borders and easing of restrictions;

•  increased risk of transmission and incidence of COVID-19 in ASC worksites consequent on the movement of employees and contractors between the general community and the workplace and vice versa; and

•  the increased transmissibility of the omicron variant of COVID-19 and the risk that future variants could pose a greater risk to health and safety.

[225] ASC also submit:

•  scientific and medical evidence continues to support vaccination against COVID-19 as the single most effective measure to mitigate risk;

•  that vaccines, including different forms of vaccine, are readily available to employees;

•  the Policy has been implemented following consultation;

•  the Policy has been implemented for all other ASC worksites, employee work groups and contractors from 28 March 2022 and that it is equitable for employees to be treated consistently;

•  it would be unfair to those employees who were reluctant to be vaccinated but who have done so in recent months to now allow a small group remaining unvaccinated to not be required to comply on account of the high vaccination rates achieved by others;

•  the unique and confined working environment in and around submarine manufacture and maintenance 68; and

•  a failure to be double vaccinated creates business continuity risks 69 given:

•  the requirement by ASC’s client (the Navy) that crew and persons on vessels taken from an Australian port into open water must be double vaccinated; and

•  employees travelling on short notice to its Western Australian operations or internationally require double vaccination under current government directions.

[226] Whilst a full bench of the Commission in Mt Arthur Coal concluded that the intended mandatory vaccination policy in that matter was reasonable, each case turns on its own facts. Mt Arthur Coal is instructive, but not determinative.

[227] Assessing reasonableness requires a weighing exercise. In weighing these factors I take into account that the Commission should not substitute its view for management decisions except where such decisions are unlawful, unreasonable or otherwise require third-party intervention.

[228] I have considered all factors though not all factors carry the same weight.

[229] I do not consider the fact that ASC worksites are not and have not been the subject of government direction mandating vaccination to be of any particular weight in assessing the reasonableness of ASC’s policy. Whilst the existence of a government mandate requiring vaccination to enter a high-risk setting may weigh in favour of a complementary policy mandate at that setting being reasonable, the converse is not true. The reasonableness of an employer’s policy proposing a vaccination mandate is to be objectively considered on its merits, and not be burdened by a presumption of unreasonableness simply because government authorities have not declared that worksite to be a high-risk setting.

[230] For similar reasons I give no weight to the fact that on 24 May 2022 (the day prior to closing submissions), the declaration of a major emergency by the State Co-ordinator for the State of South Australia was revoked. There is no material before me as to whether or how those emergency powers otherwise reside in statute or with executive government. There is no evidence that the declaration was accompanied by any altered assessment by authorities of the public health risks from COVID-19 or renewed guidance to the public or private sector. There is no evidence that the existence of the emergency management declaration (made in March 2020) bore on ASC’s decision to adopt the Policy in November 2021 or its subsequent decisions on 21 December 2021 and 7 March 2022 to proceed with the mandate. As the existence of the declaration was not a matter said to weigh in favour of reasonableness, its revocation (at least on the material before me) does not materially weigh against that conclusion.

[231] However, I give significant weight to the fact that a vaccination mandate intrudes on one’s right to bodily integrity. The practical effect of the Policy is to place pressure on an employee to give up this fundamental right, given that non-compliance is accompanied by potential disciplinary consequences that include termination of employment. This weighs against the Policy being assessed as reasonable.

[232] I also give weight to the following countervailing considerations.

[233] The Policy provides for medical exemption and in that sense it is not an unqualified vaccination mandate.

[234] The Policy has a logical and understandable basis in that it deals with the management of a real and present risk to health and safety. I give significant weight to this consideration given the collective rights and obligations ASC and employees have to the management of workplace health and safety (including the mitigation of risk). Five factors in particular provide collective weight to this consideration.

[235] Firstly, persons employed by ASC under the Agreement interact with each other, with other employees and contractors and between the broader community and the worksite. The risk of transmission is real, not abstract or peripheral.

[236] Secondly, whilst the Omicron variant of COVID-19 is less severe in impacts, it is highly transmissible and the rates of transmission are material following the opening of borders and easing of restrictions.

[237] Thirdly, vaccination materially mitigates against serious risk to health and safety from COVID-19. It is an agreed fact that: 70

“Covid-19 vaccines currently available in Australia substantially reduce the risk of serious illness or death.”

[238] Fourthly, controls of the type introduced by ASC in phase 1, whilst useful, inadequately mitigate risk. A comparable observation is made in Mt Arthur Coal 71. In this matter it is an agreed fact that:72

“the effectiveness of these measures depends on people applying them consistently or correctly. They do not provide a substitute for the constant protection offered by vaccines, nor do they reduce the risk of developing serious illness once somebody acquires an infection.”

[239] Fifthly, work on the construction and maintenance of submarines means that this ASC worksite involves, in varying degrees, circumstances where work occurs in confined spaces meaning that social distancing amongst employees and contractors is difficult in such environs.

[240] I give some but only limited weight to the business continuity risks raised by ASC. A policy requirement that persons working at the Osborne site (including those under the Agreement) be double vaccinated ensures that such persons would be able, if required, to work on Navy vessels (including submarines) in open water, or travel to ASC’s Western Australian operations. Conversely, under current contractual arrangements with the Navy and under current border entry requirements of the Western Australian government, an employee not double vaccinated would not be so entitled and could not do the work reasonably required of them.

[241] I give some weight to this factor because ASC’s ability to ask or require employees to perform work on vessels at sea (including maintenance) or travel to operations in Western Australia and have those persons eligible to do so as and when asked or required is a legitimate expectation given the importance of business continuity to its operations. That some roles performed by employees involve persons with specialised skills adds to the business continuity risk if those persons are needed but not eligible to do that work. I also take into account that as the South Australian and Western Australian border has re-opened, the frequency of cross-border movement by ASC employees may reflect over time more standard operational needs.

[242] However, I give this only limited weight for two reasons. Firstly, in a total workforce at Osborne of some one thousand persons (about 270 under the Agreement) and given the rates of vaccination amongst the workforce, the risk to business continuity should not be exaggerated. Workarounds are likely to exist despite the specialised nature of some tasks. Secondly, the incidence of movement of persons beyond the Osborne worksite, whilst material, is not frequent. It is an agreed fact that this occurs “from time to time” 73. The evidence before me is that most submarine maintenance work is conducted in dock, not at sea. Travel between South Australian and Western Australian operations occurs only when operationally required.

[243] I do not give any particular weight to the decisions made by SafeWork SA or Comcare, which have, it would appear from the evidence, set aside provisional improvement notices (PINS) and objections by certain persons to the Policy. I decline to do so for three reasons. Firstly, the basis upon which those conclusions were reached by those agencies was not tested before me. Secondly, and notwithstanding some overlap with the WHS Act, those matters concern their own statutory and regulatory context. Thirdly, at least one such decision (the setting aside by Comcare on 12 May 2022 of an earlier PIN) is currently under review.

[244] I do not consider the fact that a large percentage of ASC’s workforce is now vaccinated (and thus at less risk of serious adverse health consequences or death from COVID-19) to be a persuasive argument against the reasonableness of the phase 2 mandate. Firstly, I am satisfied on the evidence that those higher vaccination rates are, at least in some measure, a direct or indirect effect of the Policy mandate. Secondly, in an environment where current variants of the virus are highly transmissible and rates of transmission are material, it is not rational to conclude that a Policy mandating vaccination is unreasonable simply because high vaccination rates have left fewer persons unvaccinated and thus mitigated risk.

[245] Considered overall, the factors in favour of the Policy, and in particular the phase 2 vaccination mandate, being assessed as reasonable outweigh the factors against. That the mandate places pressure on an employee to give up a fundamental right to bodily integrity is weighty, but workplaces are environments where individual rights are not unqualified as collective rights and obligations must also exist. The provision for medically verifiable exemptions provides some balance between this individual right and other collective and, in this matter, more weighty overall considerations.

[246] I do not conclude that phase 2 of the ASC Policy or its implementation measures are disproportionate as a workplace health and safety response to the risks presented by COVID-19.

[247] Whilst that is a sufficient basis on which to assess reasonableness, I also consider it reasonable for ASC to apply the Policy consistently across its worksites. In the context of this matter where I have concluded that the Policy is not a disproportionate response to current risks, consistency in application is a reasonable expectation given that the transmission risk does not discriminate between employee cohorts or worksites. The Policy applies consistently to contractors and visitors as well as employee cohorts.

[248] For these reasons, and subject to three recommendations (below), I do not conclude that phase 2 of the Policy is unreasonable. That being so, I conclude that a direction to comply with the Policy would be reasonable.

[249] The answer to the second question is yes.

Conclusion

[250] I have concluded that the ASC Policy (which includes mandatory vaccination) is not unlawful nor unreasonable and that a direction to employees to comply with the Policy would be lawful and reasonable.

[251] However, I consider it appropriate to make three recommendations.

Recommendation 1 – extension of holding period for a further 14 days

[252] Firstly, I have determined this dispute in the context where although the phase 2 Policy has been implemented generally across the workforce (including contractors) from 28 March 2022, enforcement measures against employees under the Agreement who have not provided proof of vaccination or a medical exemption are in abeyance.

[253] At the hearing of this matter, there were five persons employed under the Agreement said to be in that category. To comply, those persons have an obligation under the Policy to provide proof of vaccination or produce a medical exemption. They had received show-cause letters requiring response by 27 May 2022, although the interim order I issued suspended that obligation to respond and precluded ASC taking any disciplinary action for non-compliance pending determination of this dispute.

[254] Whether those persons are unvaccinated or otherwise in non-compliance or have or are seeking medically verifiable exemptions is not a matter before me and not one on which I make any observation.

[255] However, having now determined this dispute the interim order of 25 May 2022 ceases to have effect. In those circumstances I consider it reasonable to enable those persons and the applicant Unions, as well as ASC, to consider these reasons and the outcome of this arbitration before making further decisions on compliance with the Policy or taking any disciplinary action.

[256] I recommend that at least a further seven days be provided from the publication of this decision before any response to the show cause letters be required, and that a further seven days from that date (being at least fourteen days from this decision) be provided before ASC, after considering the responses received, take disciplinary action (if any) against those persons in receipt of show cause letters. This period of time is needed to enable an employee to consider their position, take advice, and raise with ASC any matters relevant to compliance, their employment or personal circumstances.

Recommendation 2 – review within 12 months

[257] As is apparent from these reasons, an issue relevant to the assessment of reasonableness of the vaccine mandate is that phase 2 of the Policy is not currently disproportionate to the risk presented by COVID-19.

[258] It follows that as circumstances change, it may be appropriate for ASC to alter Policy settings. A material reduction in risk may, at some future time, tip the balance such that a Policy requiring mandatory vaccination by existing or new employees may no longer be a proportionate and reasonable response to risk given its intrusion on a person’s right to bodily integrity.

[259] Conversely, if new variants of COVID-19 emerge or if increased rates of transmission or morbidity occur (consequent, for example, on the further opening of domestic and global borders or increased movement of persons), then continuing or more stringent Policy settings (whether phase 1 controls or phase 2 mandates) may be justified.

[260] For these reasons and given the relatively rapid changing face of the pandemic and its impact on workplaces and communities domestically and globally, I consider it appropriate to recommend that ASC review the settings of its COVID-19 Policy (phases 1 and 2) commencing no later than 12 months from this decision. Such review should be conducted consistent with its obligations under the Agreement and statute, including consultation with Health and Safety Representatives and the Joint Consultative Committee. Nothing in this recommendation restricts an earlier review being conducted.

Recommendation 3 – consultation on booster vaccination

[261] I note that the issue whether ASC’s existing Policy should be supplemented by including a mandatory requirement for a third (booster) dose of vaccine against COVID-19 is a live issue held in abeyance pending this decision. Other than the recommendation below, I make no determination on that question, as I have not been asked to do so.

[262] In light of the determination of this dispute, I recommend that consultation on that matter proceed to a conclusion with the view to a decision being made by ASC, after considering all relevant matters including the views of affected parties, on whether its current Policy should be supplemented by that additional measure.

[263] I express these three recommendations as recommendations only, not as directions. I do not consider it appropriate to direct timelines on recommendations 1, 2 or 3 as this would unduly restrict scope for the detail of these issues to now be discussed and resolved at the workplace level.

Disposition

[264] The answer to question 1 is ‘yes’.

[265] The answer to question 2 is ‘yes’.

[266] The dispute is determined accordingly.

[267] As a consequence of the dispute being determined, the interim order of 25 May 2022 ceases to have effect.

DEPUTY PRESIDENT

Appearances:

P Dean instructed by M Kaukas, with permission on behalf of the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU) and the Australian Workers’ Union (AWU).

M Vallence, with permission on behalf of ASC Pty Ltd T/A Australian Submarine Corporation

Hearing details:

2022
Adelaide (by video conference)
12, 19 and 25 May

Printed by authority of the Commonwealth Government Printer

<AE511522  PR741690>

 1   On 14 December 2021 the AMWU amended the respondent’s corporate name in its application

 2   Email ‘Chambers – Anderson DP’ 28 April 2022 4.51pm; cl 13(a)(iv) of the Agreement entitled the parties in dispute to representation

 3   PR741915

 4   AMWU1

 5   AWU1

 6   AMWU2

 7   AMWU3

 8   AWU2

 9   AMWU4

 10   ASC3

 11   Mr Whiley gave oral evidence under subpoena issued on 18 May 2022 at the applicant’s request

 12   ASC5

 13   The Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) is also covered

 14   ASC1 Statement of Agreed Facts 17 May 2022

 15   The Emergency Declaration by the State Co-ordinator for the State of South Australia was revoked on 24 May 2022 (AMWU5)

 16   AWU4 FAQ 1

 17   AWU4 FAQ 3

 18   ASC5 paragraph 21; audio Ms Horne 25 May 2022 10.57am and 11.51am

 19   ASC5 paragraph 36

 20   ASC3 paragraph 50 Attachment 10

 21   ASC3 paragraph 72 Attachment 22

 22   ASC3 paragraph 77 Attachment 27

 23   Ibid

 24   ASC3 paragraph 98 and Attachment 37

 25   ASC3 paragraph 100 and Attachment 38

 26   ASC4

 27   ASC2

 28   Union Outline of Submissions para 13; ASC Outline of Submissions para 2

 29   Construction, Forestry, Mining and Energy Union v Mt Arthur Coal Pty Ltd [2021] FWCFB 6059

 30   Berri at [114]; AMIEU v Golden Cockerel Pty Ltd [2014] FWCFB 7447; Kucks v CSR Limited (1996) 66 IR 182; Short v Hercus (1993) 40 FCR 511; Qantas Airways Ltd v Australian Licensed Aircraft Engineers Association (No 3) [2020] FCA 1428

 31   Kucks v CSR Ltd 66 IR 182 at 184; see also Amcor Ltd v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241 at 270 per Kirby J

 32   James Cook University v Ridd [2020] FCAFC 123 at [65] (vii) citing City of Wanneroo v Holmes (1989) 30 IR 362 at 378-379 and WorkPac v Skene (2018) 280 IR 191 at [197]; see also Australian rail Tram and Bus Industry Union v Qube Logistics (Rail) Pty Ltd [2020] FCA 1520 at 11

 33   Berri at [114] principles 10, 11 and 12; Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 at [35]

 34   James Cook University v Ridd [2020] FCAFC 123 at [65] (v) citing Short v FW Hercus Pty Ltd (1993) 46 IR 128 at 135

 35   Berri at [44]

 36   Amcor Limited v CFMEU (2005) 222 CLR 241 at 270 per Kirby J

 37   Berri at [114] principle 2

 38   Consultation clause in modern awards [2013] FWCFB 10165 at [35]; Construction, Forestry, Mining and Energy Union v The Newcastle Wallsend Coal Company Pty Ltd (1998) 88 IR 202 at 218

 39   CPSU v Vodafone Network Pty Ltd AIRC PR911257 at [25]; CEPU v QR Limited [2010] FCA 591

 40   Australian Workers' Union v Santos Limited [2021] FWC 725 at [144]

 41   Page 1

 42   Page 2

 43   Page 4

 44   Audio Mr Whiley 19 May 2021 4.58pm

 45   Audio Ms Horne 25 May 2022 11.11am

 46   Ibid

 47   ASC3 Attachment 34

 48   Audio Mr Schuit 12 May 2022 3.53pm

 49   ASC3 Attachment 37

 50   Audio Mr Whiley 19 May 2022 5.11pm

 51   Audio Mr Whiley 19 May 2022 5.49pm

 52   Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v QR Limited [2010] FCA 591 at [44]

 53   Ibid

 54   Audio Ms Horne 25 May 2022 11.15am

 55   Commissioner for Government Transport v Royall [1996] HCA 80

 56   Mt Arthur Coal [187]

 57   Applicant Outline of Submissions paragraph 46

 58   Mt Arthur Coal [222]

 59   [2022] FWC 81

 60   [2021] NSWCA 299 at 1320

 61   [2019] FWCFB 2946

 62   Mitsubishi [160] to [166]

 63   See Shepheard v Calvary Health Care t/as Little Company of Mary Health Care Limited [2022] FWC 92 at [48]

 64   Qantas Airways Limited v Mazzitelli [2020] FWCFB 2628 at [33]-[34]

 65   Australian Federated Union of Locomotive Enginemen and State Rail Authority of New South Wales (1984) 295 CAR 188; see also Construction, Forestry, Mining and Energy Union v HWE Mining Limited [2011] FWA 8288 at [7] to [10]

 66   Mt Arthur Coal [223]

 67   Applicants Outline of Submissions paragraph 61

 68   Audio Ms Horne 25 May 2022 11.47am

 69   Audio Ms Horne 25 May 2022 11.49am

 70   Agreed Fact 22

 71   Mt Arthur Coal [29] at 5, 6, 7 and 9

 72   Agreed Fact 23

 73   Agreed Fact 3