[2012] FWA 5374

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FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.229 - Applications for bargaining orders

"Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU)
v
Cochlear Limited
(B2011/4085)

Mr David Hargraves
v
"Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU)
(B2011/4101)

COMMISSIONER CARGILL

SYDNEY, 3 AUGUST 2012

Applications for bargaining orders.

[1] This decision arises from two applications for bargaining orders made pursuant to section 229 of the Fair Work Act 2009 (the Act). The application in matter B2011/4085 which was lodged with Fair Work Australia (FWA) on 15 December 2011 is made by the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU or the union). It seeks orders against Cochlear Limited (Cochlear or the company).

[2] The application in matter B2011/4101 was lodged on 19 December 2011. The application is made by Mr D Hargraves who is a bargaining representative on behalf of Cochlear. In this application Mr Hargraves seeks an order against the AMWU, its officers and representatives.

[3] It should be noted that, because Mr Hargraves is also a witness in both matters and in order to avoid confusion, I have generally referred to the parties as being the AMWU and Cochlear.

[4] The matters were listed for mention by recorded telephone hearing on 22 December 2011. Following that hearing agreed directions were issued. These set out a program for the filing and exchange of material in relation to both matters.

[5] Hearings of the substantive matters took place on 19, 20, 21, 22 and 23 March, 30 April, 2, 3, 4, 7, 21 and 31 May and 9 July 2012. There were also a number of hearings which dealt with associated issues such as orders for production of documents. Some of those proceedings occurred by recorded telephone hearing, on 30 March and 18 April 2012, and others in formal hearings on 7 February and 13 April 2012. An inspection of the premises of Cochlear where the work which is relevant to these applications is carried out took place on 21 March 2012. That inspection included viewing the lunchrooms, the Mural Room and “Mulberry B”, each of which features in the evidence.

[6] During the substantive hearings the AMWU has been represented by Ms Howell of Counsel, together with Mr McCauley, Legal Officer with the union. Cochlear has been represented by Mr Wood, S.C. and Mr Saunders of Counsel.

[7] There are two employee bargaining representatives who have been involved in the negotiations, Mr Junday and Mr Naing (the EBRs). They have been represented in these proceedings by Mr Brown, solicitor. Cochlear has provided what has been described as “legal aid” to the EBRs for the purposes of seeking advice from and retaining Mr Brown’s services.

[8] There has been extensive evidence, submissions and other material produced in these matters. One example is the agreed chronology of events which extends for 24 pages. In the circumstances I do not intend to provide a detailed summary of all of the evidence and submissions. However, in reaching my conclusions, I have had regard to all of the material before me.

ORDERS SOUGHT

[9] The AMWU has amended the orders initially sought in its application. The amended claim is as follows:

[10] It is recognised that the dates at Orders 3 and 6 would need to be further amended.

[11] Mr Hargraves has also amended the order he initially sought in his application. The amended claim is as follows:

[12] In practical terms this has been further amended to be the Protocols as proposed in Appendix D to Cochlear’s submissions of 28 May 2012 or as further varied by agreement of the parties.

BACKGROUND AND OVERVIEW

[13] The following brief background and overview is provided in order to place the evidence and submissions into context. The agreed chronology referred to earlier sets out all of the relevant actions of and interactions between the parties.

[14] Cochlear describes itself as the world leader in the implantable hearing market. Its production facility is presently at Lane Cove although that facility will be moving to new purpose-built premises in Macquarie Park when various regulatory issues have been cleared. Cochlear employees 434 production employees. These come from a wide range of cultural and linguistic backgrounds.

[15] There are two shifts for production employees. One is variously described as the morning or day shift and operates from 6am to 1.51pm. The other is the afternoon shift and runs from 2.15pm to 10.06pm. There are 288 employees on the morning/day shift and 146 on the afternoon shift. Employees have staggered meal and rest breaks. The details of these arrangements are set out in Exhibit Cochlear 6 and in paragraph 16 of Exhibit Cochlear 33. The rest break is of 15 minutes duration and is paid. The lunch break is of 30 minutes duration and is unpaid.

[16] Cochlear and the AMWU are parties to an agreement which was made under the Industrial Relations Act 1996 of New South Wales. That agreement is titled Cochlear Limited Enterprise Partnership Agreement 2005 and had a nominal expiry date of 30 June 2007 (2005 Agreement. By virtue of various changes to the Federal legislation, that 2005 Agreement has become in turn, a preserved collective State agreement and a transitional instrument.

[17] Employees are also covered by individual common law contracts. The employees have received pay increases on 1 July in at least the years 2007 to 2011, both inclusive. That increase was 4% in each of those years except for 2009 when the increase was 3%. A 2008 template contract is at Exhibit AMWU 32 and a more recent standard contract is Annexure How2 to Exhibit Cochlear 32.

[18] In 2006 Cochlear and the AMWU entered into an agreement to govern right of entry visits by the union. That agreement is titled “Code of Practice for Right of Entry” (Code of Practice) and is Annexure How 4 to Exhibit Cochlear 32. In correspondence dated 11 May 2007 Cochlear advised the AMWU that it would not continue to afford the union officials the privileges of the Code of Practice.

[19] On 20 August 2009 FWA issued a majority support determination (MSD) which found that a majority of Cochlear’s production employees wanted to bargain with the company for an enterprise agreement.

[20] At the AMWU’s suggestion Cochlear and the union negotiated a set of protocols to apply to the bargaining process. These negotiations took place between September 2009 and June 2010. The protocols were signed by the various bargaining representatives including the EBRs between 16 July and 2 August 2010. The signed protocols (the Protocols) are Attachment TA36 to Exhibit AMWU 2 and also Annexure A to Exhibit Cochlear 21. It is these Protocols which are referred to in Mr Hargraves’ proposed order set out above.

[21] Bargaining meetings took place on the following dates: 17 September 2010; 13 October 2010; 3 November 2010; 24 February 2011; 25 May 2011; 8 June 2011; 28 June 2011; 20 July 2011; 16 August 2011; and 2 November 2011. Minutes of these meetings were taken by a Cochlear representative. The AMWU took its own notes.

[22] The exchanges between the parties during the course of the bargaining are fulsomely dealt with in the evidence of several of the witnesses. It is instructive to note that the detailed written positions of the respective parties were put on the following dates:

[23] On 4 November 2011 the AMWU advised Cochlear in writing that it intended to repudiate the Protocols and continue bargaining in accordance with the relevant provisions of the Act. In further correspondence dated 5 December 2011 the union confirmed that it had repudiated the Protocols. Cochlear has not accepted the repudiation of the Protocols.

[24] The nomination forms of those employees who nominated either one or both of the EBRs to represent them in the bargaining are contained in Exhibit AMWU 42. There are 23 from July 2010, 35 from December 2011, one from February 2012, one undated and one unsigned and undated. The names of the signatories have been redacted as agreed.

[25] A statutory declaration at pages 190 to 194 of Exhibit Cochlear 35 shows that, as at 31 March 2012, the AMWU represented 158 members at Cochlear.

EVIDENCE

[26] The AMWU called five witnesses: Mr T Ayres, the NSW State Secretary of the union; Ms R Fortescue, the NSW Secretary of the Technical, Supervisory and Administrative Division of the union; Mr L Mason, employee of Cochlear and AMWU delegate; Ms S Fan, employee of Cochlear and AMWU delegate; and Mr G Simon, AMWU Organiser.

[27] Mr Ayres provided three witness statements. The first was dated February 2012 and became Exhibit AMWU 2. Although this statement does not contain an exact date it was prepared on or about 8 February 2012 and is referred to in Mr Ayres’ other statements as having that date. The second statement was dated 22 February 2012 and was made in reply to Mr Hargraves’ first statement, Exhibit Cochlear 21. This second statement was marked Exhibit AMWU 3. Mr Ayres’ third statement was dated 7 March 2012 and is in reply to statements of Mr Hargraves and Mr Howitt in reply in the AMWU application. This third statement was marked Exhibit AMWU 4. Mr Ayres also gave oral evidence which is at PN 711-3153 of Transcript.

[28] In his first statement Mr Ayres gives evidence that, since 2006, he has overseen the AMWU’s activities on behalf of members at Cochlear. He notes that, since the expiry of the 2005 Agreement, the union has attempted to negotiate a new collective agreement. Mr Ayres gives evidence of various steps taken by the union during 2007, 2008 and 2009 to pursue that objective. These included conducting surveys and ballots of members and employees to gauge support for a collective agreement.

[29] Mr Ayres’ evidence is that Cochlear refused to engage with the AMWU in relation to any such agreement and instead attempted to pursue a non-union agreement with employees and have the 2005 Agreement terminated. His evidence is that the company’s refusal to engage persisted after the commencement of the Act.

[30] Mr Ayres gives evidence about the union’s application for an MSD and its concerns about Cochlear’s actions leading up to the ballot which was held to determine whether there was majority support for bargaining. He notes that, two days prior to the ballot, Cochlear wrote to employees guaranteeing not to alter the terms and conditions of its common law contracts, other than wages and classifications, until 1 July 2012.

[31] Mr Ayres gives evidence about exchanges with the company following the MSD and concerns which he had about delays to bargaining. His evidence is that, following a conference in FWA, he proposed a set of bargaining protocols to facilitate negotiations for and the making of a collective agreement.

[32] Mr Ayres notes that Cochlear initially rejected the concept of having such protocols and refers to exchanges and meetings between the parties about this and related issues, especially the number of employees who were to participate in bargaining.

[33] It is Mr Ayres’ evidence that Cochlear had taken his good faith offer of bargaining protocols to make them a precondition to substantive bargaining and had then frustrated the negotiations for the protocols as a means by which to further delay bargaining. His evidence is that this view was reinforced by Cochlear’s actions in April 2010 in introducing new matters to be placed in the protocols. Mr Ayres’ evidence is that Cochlear was not being genuine and was merely raising these matters to prevent agreement on the protocols thereby further delaying bargaining.

[34] Mr Ayres’ evidence is that, when he signed the Protocols in August 2010, he did so because he was anxious that substantive bargaining had not commenced and despite his concerns that some matters in the Protocols would lead to formalistic and slow negotiations. His evidence is that he was disappointed with the slow progress thus far and wanted to begin substantive bargaining. In his oral evidence Mr Ayres testified that, in signing the Protocols, he took a leap of faith that a constructive bargaining relationship could develop.

[35] Mr Ayres’ evidence is that, at the 1st bargaining meeting, he outlined the union’s claim which was a codification of the various conditions applying to employees including the common law contracts, the 2005 Agreement and company policies. At the 3rd bargaining meeting he provided a bargaining issues document to assist in identifying areas of agreement and disagreement.

[36] Following the 3rd meeting, Mr Hargraves provided the union with a document which set out 33 questions about the AMWU’s claim. It is Mr Ayres’ evidence that these were argumentative and simply an attempt to delay progress by requiring futile debate. No counter proposals were provided or discussed.

[37] Despite his reservations about the questions, on 22 December 2010, Mr Ayres provided answers to some of them in tabular form as well as a draft agreement. It is the evidence of Mr Ayres that Cochlear refused to allow the AMWU to meet with employees in paid time or in the main lunchroom. His evidence is that this prevented the union adequately consulting members and employees about the progress of bargaining.

[38] Mr Ayres’ evidence is that the bargaining issues table was updated by the union from time to time. His evidence is that this document and the draft agreement reflected the union’s position of consolidating existing conditions into one instrument. His evidence is that the union’s claim is not extreme and not foreign to Cochlear’s operations.

[39] It is Mr Ayres’ evidence that the pay rise given to employees in July 2011 was outside of the bargaining process and done without discussion with or advice to the AMWU.

[40] The position of the EBRs was provided at the 8th bargaining meeting. Mr Ayres notes that the position of both EBRs was the same and that neither advanced any claim which was different to the company’s position.

[41] Mr Ayres refers to an exchange of emails in August 2011. His evidence is that Cochlear’s refusal to substitute another manager for one of its bargaining representatives, Mr Jarman, who was to be on leave for six weeks confirmed his apprehension that the Protocols were frustrating the bargaining process. Mr Ayres also gives evidence that Cochlear’s position put forward at that time, that the company would not advance any specific claims of its own and would not accept provisions from the individual contracts being placed in a collective agreement, was a radical departure from the discussions to that point.

[42] The company’s written response to the AMWU claims was provided on 30 August 2011. Mr Ayres’s evidence is that, despite numerous requests since that time, the company has not provided an alternative draft agreement. His evidence is that Cochlear’s response confirmed his view that the company did not intend to ever reach a collective agreement. This view was based on the fact that Cochlear’s proposal could never be approved by FWA, would never be agreed to by the employees and could not be constructively responded to.

[43] On 31 August 2011 the AMWU lodged a bargaining dispute application pursuant to section 240 of the Act. The issues in dispute included Cochlear’s refusal to meet while its representative was on leave, its failure to respond to claims in a timely manner, the independence of the EBRs, the suitability of the Protocols and the union’s access to members.

[44] On 7 September 2011 Mr Hargraves raised concerns about the union’s bargaining conduct. Mr Ayres gives evidence about subsequent exchanges. In particular, he refers to a letter from Cochlear dated 25 November 2011 which required the union to advance information which would show that granting the claims would contribute to the company’s international competitiveness. It is Mr Ayres’ evidence that the company’s approach in this regard is an artificial and arbitrary constraint designed to frustrate the reaching of an agreement. His view is that Cochlear’s position appears to be motivated by a determination never to reach agreement.

[45] Following a conference concerning the union’s bargaining dispute held in FWA on 5 December 2011 Mr Ayres wrote to Cochlear. Mr Ayres referred to concerns raised earlier and confirmed that, in the light of those concerns, the union was repudiating the Protocols. He noted that the union was still committed to bargaining and proposed dates for future meetings. Mr Ayres again sought Cochlear’s agreement to paid meetings with employees and access to the main lunchroom.

[46] It is Mr Ayres’s evidence that Cochlear’s position put forward on 30 August 2011 was a tactic designed to further frustrate the bargaining process. Further, he says that it is not possible for the union to effectively bargain in the absence of an alternative position from the company.

[47] Mr Ayres’ evidence is that the last occasion on which he was able to address a paid meeting of employees was in the lead up to the MSD ballot. It is his evidence that he has made several requests for paid meetings since that time. He believes that it is not possible for the AMWU to properly bargain on behalf of its members in the absence of an opportunity to meet with them, to discuss proposals and develop responses.

[48] It is Mr Ayres’ evidence that Cochlear’s insistence on only permitting access to a small meeting room, distant from the main lunchroom, has restricted the number of members able to attend meetings. His evidence is that he is aware that Cochlear has conducted meetings with employees in paid time which have included feedback on bargaining. The union has not been invited to participate in these meetings.

[49] In his second statement Mr Ayres gives evidence about the basis for his view that the Protocols had become unworkable and an obstacle rather than an aid to good faith bargaining. Mr Ayres advances six main reasons. First, the mandatory two hour maximum duration of the meetings. This time period is too short. It is Mr Ayres’ evidence that, on several occasions, Cochlear has stopped discussions when that period of time has passed. The company has declined to extend the length of meetings despite a number of requests by the union.

[50] The second reason is the two week minimum period between meetings. Mr Ayres’ evidence is that the company has insisted on strict adherence to this requirement even when it would have been useful to have had follow up meetings to conclude discussions on a particular issue. The requirement for a minimum period has also led to lengthy delays between meetings. It is Mr Ayres’ evidence that the short duration and infrequency of meetings under the Protocols contributed to the lengthy delay in receiving Cochlear’s response to the union claim.

[51] The third reason is the requirement for only named participants to attend meetings. It is Mr Ayres’ evidence that scheduling of meetings has been delayed on several occasions because of Mr Jarman’s absence overseas. His evidence is that Cochlear has rejected the provision of a substitute bargaining representative.

[52] The fourth reason is the number of AMWU employee representatives allowed under the Protocols and the inability to provide substitutes other than on a permanent basis. It is Mr Ayres’ evidence that the three named representatives have at times had difficulty attending meetings because of work and family arrangements. This has hindered the AMWU’s ability to effectively bargain as these representatives play an important communication role between employees and the union.

[53] The fifth reason is the requirement that consultation with employees is to be unpaid and in non working time unless otherwise agreed. It is Mr Ayres’ evidence that, despite several requests, the company has never agreed to the AMWU having a paid meeting during work time. Mr Ayres’s evidence is that Cochlear holds monthly meetings with employees during which the bargaining process is one of the issues discussed.

[54] The sixth reason is the absence of a proper process to resolve difficulties in the bargaining.

[55] Mr Ayres also responds to Mr Hargraves’ first statement, Exhibit Cochlear 21. Mr Ayres’ evidence is that he first suggested the development of a bargaining protocol sometime prior to the meeting of 24 November 2009. He disagrees with Mr Hargraves’ position that the Protocols provide a fair, efficient and workable bargaining process and that they offer an effective and structured methodology for negotiations.

[56] It is Mr Ayres’ evidence that the absence of alternative proposals from Cochlear and its refusal to agree to meaningful employee consultation demonstrates the failings of the Protocols.

[57] Mr Ayres’ evidence is that he would not usually propose the use of bargaining protocols but did so in this case as a means of moving away from the heated exchanges which had developed between the parties over the previous couple of years. He put forward a simple document setting out some good faith bargaining principles. It is Mr Ayres’ evidence that these principles are absent from the Protocols.

[58] Mr Ayres agrees with Mr Hargraves that the relationship between the parties was good at the start of negotiations about a protocol. His evidence is that, as negotiations became protracted, he believed that his original proposal was becoming a hurdle to substantive bargaining beginning. Mr Ayres was frustrated that Cochlear appeared to be delaying matters. Mr Ayres’ evidence is that he expressed his misgivings to the company in correspondence of 4 January, 8 March and 12 May 2010 as well as in meetings.

[59] Mr Ayres’ evidence is that he hoped substantive bargaining would overcome difficulties with the Protocols, however, that had not occurred. Mr Ayres disagrees with Mr Hargraves that the AMWU did not notify Cochlear of its concerns about the Protocols until September 2011. His evidence is that he and other union representatives raised their concerns on many occasions, for example, in the 5th and 6th bargaining meetings.

[60] Mr Ayres’ evidence is that negotiations to amend the Protocols would be pointless. The union’s experience thus far has led it to the view that any such negotiations would involve further delay and not result in a document which would facilitate bargaining. The AMWU wishes to bargain in accordance with the good faith bargaining requirements of the Act.

[61] Mr Ayres provides further evidence about difficulties with the operation of the Protocols. His evidence is that he repeatedly told Cochlear that it had an obligation to bargain and requested a company response to the union’s written framework, draft agreement and revised framework. It is Mr Ayres’ evidence that, during the 16 month period that the Protocols were in operation, the company did not put a meaningful proposal and refused to consent to a paid consultation meeting between the AMWU and employees. The parties were not even close to reaching agreement.

[62] Mr Ayres disputes Mr Hargraves’ statement that the union has not complied with the Protocols by failing to explain the rationale for its claims. He also disagrees with Cochlear’s letter of 25 November 2011. Mr Ayres’ evidence is that Cochlear’s imposition of a requirement that each claim be justified by reference to how it would contribute to the company’s international competitiveness is not warranted by the Protocols and has led to significant delays in bargaining.

[63] Mr Ayres rejects the suggestion that the non-attendance of some AMWU employee representatives at the bargaining meetings constitutes a breach of the Protocols. His evidence is that the union has taken all reasonable steps to ensure representatives attended. Changing work and family considerations and the length of the negotiations meant that it was not possible for all representatives to attend each meeting.

[64] In response to Mr Hargraves’ evidence that the AMWU did not provide agenda items within the requisite period and failed to attend meetings in a timely manner, Mr Ayres’ evidence is that his recollection is that all of the bargaining representatives had been tardy in providing agenda items and that the union had been kept waiting on a number of occasions by Cochlear and the EBRs. One reason for the union team being late was the need to have discussions among themselves prior to the commencement of the bargaining meetings. It is Mr Ayres’ evidence that the company has refused to allow time for such discussions.

[65] Mr Ayres disagrees with Mr Hargraves’ characterisation of a statement by the National Secretary of the AMWU, Mr Oliver, as being unfair and sensationalised. Mr Ayres’ evidence is that Mr Oliver’s comments were accurate. Mr Ayres’ evidence is that, until the union notified the bargaining dispute in August 2011, he had refrained from public statements about Cochlear. He noted that Mr Oliver’s statement occurred after he had informed the company that the union was no longer constrained by the Protocols. It is Mr Ayres’ evidence that an absence of public scrutiny has contributed to Cochlear’s failure to bargain in good faith.

[66] Mr Ayres’ disputes Mr Hargraves’ claim that, absent the Protocols, negotiations may have broken down because of various issues agitated by the union. Mr Ayres’ evidence is that, despite Cochlear being provided with several documents explaining and detailing the union’s claim and many requests for a written response, this was not provided until August 2011.

[67] Mr Ayres notes that there was no requirement in the Protocols or the Act that minutes of bargaining meetings be signed. His evidence is that he was concerned about the implications of him signing minutes recorded by another party. Mr Ayres ultimately decided to sign but on the basis that separate notes would be made by the union.

[68] Mr Ayres notes that the Protocols specifically required the AMWU to seek Cochlear’s approval for paid meetings.

[69] Mr Ayres notes Mr Hargraves’ evidence about Cochlear’s internal management committee team and its regular meetings. He states that this demonstrates the unequal bargaining positions of the company and the union. Mr Ayres notes that the union has not been given any opportunity to meet with employees during work time as management has.

[70] In his third statement Mr Ayres responds to the statements of Mr Howitt, Exhibit Cochlear 32 and Mr Jarman, Exhibit Cochlear 26 as well as Mr Hargraves’ statement in reply, Exhibit Cochlear 22.

[71] Mr Ayres reiterates his earlier evidence about the union’s claim and notes that it is primarily designed to consolidate employees’ existing terms and conditions into one simple document which is enforceable under the Act. His evidence is that the relevant modern award could be incorporated by reference or the agreement could explicitly deal with award matters. The union rejects the company’s position that goes against both of those options. Cochlear’s stance would lead to an agreement which would not pass the “Better Off Overall Test” (BOOT) and could not be approved.

[72] Mr Ayres rejects Mr Howitt’s evidence that he did not refuse to meet Mr Ayres in the lead up to the MSD if he was accompanied by a delegate. It is Mr Ayres’ evidence that Mr Howitt expressly refused to meet in such circumstances and this was one of the issues about which the union lodged a bargaining dispute in September 2009.

[73] In response to Mr Howitt’s evidence about the disruption which would be caused by involving eight employees in bargaining, Mr Ayres notes that he was keen to ensure the engagement of a spread of employees across shifts and workgroups. He had also foreshadowed a request to have employee representatives attend a bargaining skills workshop. It is Mr Ayres’ evidence that attendance at such a course leads to efficient and effective bargaining and minimises time away from usual work activities.

[74] Mr Ayres’ evidence is that Cochlear’s refusal to accept how many and which employees could participate in bargaining on behalf of the union was also one of the issues in the bargaining dispute referred to in paragraph 72 above. Mr Ayres’ evidence is that, following conciliation in FWA, he then reduced the number of employees to be part of the bargaining committee to attempt to reach agreement with Cochlear on this issue. His evidence is that each of the union’s proposals on this matter has sought to minimise disruption to production whilst reflecting the employees’ rights to be represented in negotiations. It is the evidence of Mr Ayres that, following the MSD, Cochlear had an obligation to accommodate the negotiations.

[75] Mr Ayres’ evidence is that Mr Howitt’s rejection of training for members of the bargaining committee involves a failure to recognise the role of the AMWU employee representatives in the bargaining process.

[76] It is Mr Ayres’ evidence that limiting the AMWU employee representatives to three has reduced the ability of those representatives to properly communicate with employees across the whole production workplace. A greater number of representatives would have better accommodated varied work and family arrangements.

[77] Mr Ayres rejects Mr Howitt’s evidence that the union had adopted an extremely litigious approach to bargaining. His evidence is that the AMWU wants to bargain not litigate.

[78] Mr Ayres’ evidence is that Mr Howitt’s proposed consultation methods would not give employees across different shifts and workgroups an appreciation of where bargaining is up to. Mr Ayres notes Mr Howitt’s evidence that there is little said about bargaining at the monthly meetings with employees. However it is the evidence of Mr Ayres, that it is nevertheless a presentation from the company’s position only. It is also his evidence that the deliberative process of the type of meetings sought by the union is essential to developing a position and assisting the progress of bargaining.

[79] Mr Ayres’ evidence is that the union has not brought proceedings to dispute the allocation of the Mural Room for right of entry visits because of a desire to reduce the amount of litigation between the parties. He rejects Mr Howitt’s evidence that the AMWU has not complained about the Mural Room and states that the union has requested access to the main lunchroom on numerous occasions.

[80] Mr Ayres’ evidence is that the union’s claim reflects its genuine approach in relation to Cochlear’s competitive position. It is not an ambit claim and seeks to consolidate existing terms and conditions together with increases in allowances to reflect past production dividends. Mr Ayres notes that the company has not provided an example of any productivity -related initiatives.

[81] Mr Ayres disputes Mr Howitt’s reason for the refusal for a paid meeting in February 2012 on the basis that there was little to report. He notes that the last joint paid meeting was in August 2009 and his evidence is that employees have a right to an update. Mr Ayres agrees that the union has communicated with its members by other means. However his evidence is that no method other than a meeting during work time is a proper means of consultation.

[82] Mr Ayres rejects Mr Jarman’s characterisation of the union’s claim for eight employee representatives on the bargaining committee as being an ambit claim. He refers to his earlier evidence as to the rationale for having a greater range of representatives.

[83] Mr Ayres refers to Mr Jarman’s evidence about the union’s allegations in early 2010 that Cochlear had breached its good faith bargaining obligations. Mr Ayres’ evidence is that there was no basis on which the union should have withdrawn those allegations. This was due to Cochlear’s refusal to bargain. Mr Ayres also rejects Mr Jarman’s evidence that the union’s allegations were spurious.

[84] Mr Ayres’s evidence is that the AMWU has put all of the proposals for inclusion in an agreement. The company and the EBRs have not responded in any meaningful way.

[85] Mr Ayres notes that he signed the Minutes for all but one of the bargaining meetings. His evidence is that, when he had taken issue with the Minutes, discussion about that point then took up a large part of the limited time for the meeting. Mr Ayres’ evidence is that he generally considered that it was better to sign and then get on with bargaining. He notes that the union maintained its own records of the meetings.

[86] Mr Ayres disputes Mr Jarman’s evidence that the issue of paid mass meetings was only raised at three meetings. Mr Ayres’ evidence is that the issue was discussed at at least six meetings.

[87] Mr Ayres disputes Mr Jarman’s view that there are significant differences between the positions of Cochlear and the EBRs. He refers in particular to the updated bargaining issues table provided by the company on 15 February 2012.

[88] Mr Ayres’ evidence is that he has no issue with providing a substitute to attend any bargaining meeting if he is unavailable and notes that this occurred on one occasion.

[89] Mr Ayres rejects Mr Hargraves’ evidence that there isn’t strong support among employees for an enterprise agreement. Mr Ayres refers to the MSD and earlier ballots and surveys. His evidence is that Cochlear does not want to bargain and is simply looking for an excuse.

[90] Mr Ayres notes Mr Hargraves’ evidence about the limited contribution of the delegates at bargaining meetings. His evidence is that the delegates feel anxious and are reluctant to speak up. It is Mr Ayres’ evidence that this reluctance was one of the issues which would have been addressed in the proposed training which the company opposed.

[91] Mr Ayres disputes Mr Hargraves’ description of the union’s response to the questions document as being of poor quality. It is the evidence of Mr Ayres that relevant answers were provided together with a draft agreement. Mr Ayres notes that he raised reservations about the questions at the 5th bargaining meeting.

[92] Mr Ayres rejects Mr Hargraves’ suggestion that the union could hold a meeting of employees at an external venue. It is Mr Ayres’ evidence that such a location would not maximise attendance and feedback.

[93] Mr Ayres gives evidence that the AMWU has suspicions that Cochlear has improper influence over the EBRs. Nevertheless the union has treated the EBRs as being independent. It is Mr Ayres’ evidence that the union does not have the contact details of the EBRs despite requesting such. It was in this context that the union expected that Cochlear would pass on to the EBRs material which the AMWU had provided to it. It is Mr Ayres’ evidence that this apparently happened sometimes but not always.

[94] Mr Ayres disagrees with Mr Hargraves’ evidence that paid meetings are not usual practice particularly at an early stage in negotiations. Mr Ayres’ evidence is that his requests for paid meetings have not been premature. He also notes that the length of the negotiations in this case makes the situation extreme, not usual.

[95] Mr Ayres rejects Mr Hargraves’ characterisation of the union’s claim. His evidence is that almost all of the claims come from the existing instruments covering employees and the claims reflect consultation with employees about what they want in an agreement. It is Mr Ayres’ evidence that the union continues to pursue its claims with Cochlear as shown in correspondence to the company dated 7 March 2012 requesting a serious response to the union’s proposals.

[96] In his oral evidence Mr Ayres indicated that he understood that the AMWU represents around 170 members at Cochlear. He is not aware of any other employees who have separately nominated the union to represent them in bargaining. Mr Ayres also testified that, through the MSD ballot, many more employees had indicated that they want the union to bargain on their behalf.

[97] Mr Ayres confirmed that it was the AMWU which had proposed that there be a legally enforceable protocol to govern the bargaining process. He testified that he did this to build Cochlear’s confidence that bargaining could be smooth and efficient. Mr Ayres testified that he had since concluded that there is little value in having agreed rules which have been applied in the way the Protocols have by Cochlear. It would be more sensible to rely on the provisions of the Act.

[98] Mr Ayres testified that Cochlear has used the Protocols to frustrate bargaining and he would be loath to enter further discussions about developing new rules. Mr Ayres has no confidence that the parties will be able to reach agreement on rules which will work. He has been disappointed in Cochlear’s approach.

[99] Mr Ayres testified that, in the usual course of events, he would have no difficulty with the concepts set out in the opening words of the Protocols, namely improving productivity, supporting job security and supporting the company’s competitive goals. Mr Ayres testified that his concerns have resulted from the way in which Cochlear has used those concepts as an obstacle to bargaining and, in his view, to ensure that agreement is never reached. His evidence is that Cochlear was not using the wording of the Protocols in a legitimate or genuine manner but rather as a delaying strategy. Mr Ayres testified that the company’s approach was not in the interests of good faith bargaining.

[100] Mr Ayres confirmed that the union wanted an agreement which supported the concepts referred to above and testified that this could be achieved without the existence of the Protocols. Mr Ayres testified that, absent the Protocols, Cochlear could still measure proposals against those concepts if it wished.

[101] Mr Ayres testified that the number of employee representatives who would be part of the union’s bargaining team was a significant issue about which there had been much discussion in the negotiations for the Protocols. However there was also a range of other issues in play in those negotiations.

[102] Mr Ayres testified that the AMWU still had issues about the number of union representatives who should be involved in the bargaining process. The union’s present proposal as set out in Exhibit AMWU 5, is that there should be two officials and five employees representing members in bargaining. Mr Ayres denied that the union was bargaining in bad faith by seeking this number of representatives.

[103] Mr Ayres testified that he believes that Cochlear has a responsibility to bargain with the group of employees who are part of any bargaining team as well as with the union officials. Mr Ayres rejected the suggestion that, in 2009, the AMWU had made ambit or excessive claims for greater numbers of representatives. His evidence is that the purpose of a larger group was to have a more effective and democratic communication process with employees.

[104] Mr Ayres rejected the suggestion that larger numbers of persons would necessarily lead to inefficiencies in bargaining. He noted that it was up to the company to decide the number of bargaining representatives it wanted. Mr Ayres testified that the availability of Mr Jarman for meetings had been a challenge as was the Protocols’ requirement that bargaining meetings be at least 14 days apart.

[105] Mr Ayres agreed that there were no physical impediments to employees in discrete work areas communicating with others in their particular area either during work time or during their various breaks. He testified that the work environment did not facilitate the type of deliberative discussions which were needed. Mr Ayres testified that, although the union did the best it could, its lines of communication with members at Cochlear were not effective enough for the purposes of bargaining.

[106] Mr Ayres testified that the union delegates at Cochlear could pass messages to and from the union. He acknowledged that members could be contacted by phone if they had provided their details to the union and noted that this was done from time to time. Communications could also be made by way of post, email and SMS however these methods were not as effective as having an exchange of ideas in the context of a meeting.

[107] Mr Ayres testified that, whilst it was physically and financially possible for the union to organise meetings at its offices or elsewhere offsite, this was not practicable in the context of bargaining especially for larger groups of members. Mr Ayres noted that meetings had been held on the nature strip in front of the premises, however these were somewhat confronting for attendees.

[108] Mr Ayres acknowledged that the union had communicated with members at Cochlear by way of flyers. He testified that this method of communication was more suited to dealing with a narrow range of issues in a simplistic fashion and was not effective in covering the complex matters that arise in bargaining.

[109] Mr Ayres confirmed that the AMWU is seeking access to the main lunchroom for meetings. His evidence is that both the Mural Room and another room previously provided for meetings are totally inconvenient and unsuitable. Mr Ayres testified that the meetings would not be restricted to union members and would be for the purpose of discussions about bargaining developments. Mr Ayres’ evidence is that, although the AMWU formally represents only its members, he wishes to achieve the strongest possible democratic mandate for its claims and for that purpose wants to hear the views of other employees. He testified that he is reluctant to have meetings just for members as people have informed him that they are frightened of what this might entail for their employment.

[110] Mr Ayres testified that he did not rule out the possibility that the issue of union membership may be raised and discussed in these meetings. He confirmed that increasing union membership was part of the union’s purpose in seeking these meetings but was not the driving reason which is to discuss bargaining.

[111] Mr Ayres testified that he had had reservations about signing the Minutes of some bargaining meetings. He noted that this was not a requirement of the Protocols and that, initially, Cochlear had insisted on unqualified agreement. He testified that the qualification which had been introduced later, had addressed some of his concerns and overcame the necessity to argue about the Minutes at each meeting with a consequent waste of time. Mr Ayres denied that he had refused to sign the Minutes because he didn’t want them posted on the noticeboard.

[112] Mr Ayres’ evidence is that the union did not always receive the Minutes prior to the next meeting. He testified that the Minutes reflected Cochlear’s view and were not independent. His evidence is that the union wanted decisions and outcomes recorded in the Minutes not just what the company had said. Mr Ayres agreed that he had a particular objection to a statement made by Mr Junday in the 3rd bargaining meeting concerning the number of employees he allegedly represented.

[113] Mr Ayres denied that the union had tried to exclude the EBRs from the bargaining process or that he considered the EBRs to be in competition with the union. Mr Ayres denied that the AMWU had deliberately not served its present application on the EBRs until after the issue was raised in these proceedings in March 2012.

[114] Mr Ayres denied that the union had repudiated the Protocols in order to make sensational public comment about the bargaining at Cochlear. He testified that he is not trying to make this issue into a test case but rather is attempting to reach a fair collective agreement with the company.

[115] Mr Ayres testified that, on a number of occasions, employee representatives of the AMWU had been unable to attend bargaining meetings because of various personal commitments. He noted that the requirement in the Protocols that the meetings commence at 2pm had been an obstacle at times. Mr Ayres agreed that it had not been the union’s practice to seek a temporary substitute for the representatives. He didn’t believe it was a good idea and considered that any such request would have been refused by Cochlear.

[116] Mr Ayres testified that the union wanted to have the opportunity to have discussions with delegates prior to the start of each bargaining meeting. His evidence is that this had been a difficulty as employees had only been available at 2pm which was the time for each meeting to start.

[117] Mr Ayres agreed that, at times, the AMWU had sought the deferral of meetings and, on one occasion, had cancelled a bargaining meeting. Mr Ayres denied that the delay between the company’s response to the union’s claim, 30 August 2011, and the union’s reply of 7 March 2012 was the union’s fault.

[118] Mr Ayres testified that, although he sees no value in the continued application of the Protocols or any other written agreement between the parties about the bargaining process, there would be no difficulty in the parties verbally arranging certain matters such as identifying in advance the names of persons to attend meetings, providing representatives with reasonable notice of meetings and agreeing on what is to be discussed at each meeting.

[119] Mr Ayres agreed that, prior to informing the company that the union was withdrawing from the Protocols, he had not sought to modify the Protocols nor had he sought to trigger the disputes clause therein.

[120] Mr Ayres testified that the AMWU had put the whole of its claims to Cochlear on 22 December 2010. The union then provided further particulars of one of the items in March 2011 and incorporated those particulars into the bargaining issues table.

[121] Ms Fortescue provided two witness statements. The first was dated 8 February 2012 and was marked Exhibit AMWU 7. The second statement was dated 7 March 2012 and was made in reply to the second statement of Mr Hargraves and the first statement of Mr Howitt. Ms Fortescue’s second statement was marked Exhibit AMWU 8. Ms Fortescue also gave oral evidence which is at PN 3163-3567 of Transcript.

[122] In her first statement Ms Fortescue gives evidence that she has had dealings with Cochlear since the mid 1990s and continues to have responsibility for the AMWU members employed by the company. She has attended all of the bargaining meetings since the MSD was made and has taken notes of each of them. Ms Fortescue has also taken notes at other meetings between the union and the company held between the MSD and the start of formal bargaining. The notes of all of these meetings are attached to Exhibit AMWU 7.

[123] Ms Fortescue’s evidence is that, between the nominal expiry of the 2005 Agreement and the commencement of the Act, the AMWU continually attempted to negotiate a new collective agreement with Cochlear. Her evidence is that Cochlear refused to negotiate and never accepted the union’s right to do so. Ms Fortescue’s evidence is that, in her opinion, the company’s application to terminate the 2005 Agreement was to gain support for a non-union agreement which had been twice rejected by employees.

[124] Ms Fortescue’s evidence is that she has contact with AMWU delegates and activists at Cochlear several times a week. Her evidence is that they tell her of the difficulties they encounter in being able to discuss union matters, including the progress of bargaining, with their fellow workers. These difficulties include the fact that Team Leaders have banned discussions about bargaining and unions during work time. Ms Fortescue’s evidence is that delegates and activists have told her that they feel intimidated by the Team Leaders’ actions. Some have informed Ms Fortescue that they have been told that having union discussions in work time is a disciplinary offence.

[125] Ms Fortescue gives evidence about her attendances at Cochlear pursuant to the right of entry provisions of the Act (ROE). Her evidence is that the area allocated to the union for this purpose, the Mural Room, is too small as it only accommodates approximately six persons. The overflow of members has caused complaints from other employees who are using the open meal area nearby.

[126] Ms Fortescue’s evidence is that the main problem with the Mural Room is that, because employees generally have a 30 minute lunch break, they do not have enough time to prepare their meals, attend to other personal needs, walk to the Mural Room and stay for the meeting. It is Ms Fortescue’s view that the Mural Room is unreasonable for ROE purposes. It is also her view that it is not suitable for informing employees about the progress of negotiations.

[127] Ms Fortescue’s evidence is that the AMWU has been obstructed by Cochlear when it has attempted to meet with members on the afternoon shift. These obstructions have included restricted access during a 10 minute break or the refusal of any access because of the absence of anyone to facilitate entry to the site. It is Ms Fortescue’s evidence that there has been an ongoing problem with ROE access to the premises.

[128] Ms Fortescue refers to her notes of the bargaining meetings and states that the union has been frustrated by Cochlear’s delays and failures to respond to the union’s proposals. She provides details of correspondence from Mr Hargraves in April 2011 which she says had the effect of further delaying bargaining for no useful purpose.

[129] It is Ms Fortescue’s evidence that the attendance of delegates or activists at proceedings in FWA has often been made difficult or indeed refused by Cochlear. She provides details of one such instance in December 2011. It is Ms Fortescue’s evidence that she is concerned that Cochlear’s attitude means that delegates will never be released for an urgent matter relating to their crucial role as part of the AMWU bargaining team.

[130] In her second statement Ms Fortescue responds to the first statement of Mr Howitt, Exhibit Cochlear 32 and to the second statement of Mr Hargraves, Exhibit Cochlear 22.

[131] Ms Fortescue refers to Mr Howitt’s evidence that the AMWU was not involved to any significant extent in negotiations for agreements between 2001 and 2005. Her evidence is that she attended several meetings leading up to the 2005 Agreement. It is also her evidence that she attempted to attend meetings prior to the making of the previous agreement in 2001 but her involvement was limited by Cochlear.

[132] Ms Fortescue disputes Mr Howitt’s evidence that it is only a two minute walk from any production area to the Mural Room. She also disagrees that the meal area adjacent to the Mural Room would be suitable for production employees. It is Ms Fortescue’s evidence that Mr Howitt has not taken account of the arrangement whereby, for social and cultural reasons, employees share in the preparation and consumption of food in the main lunchroom. Her evidence is that it is not an option for many employees to change lunchrooms or attend the Mural Room.

[133] Ms Fortescue gives evidence that, for several years especially since 2007, she has complained to Cochlear’s HR Department about employees being pressured not to discuss union matters during work time.

[134] In response to Mr Howitt’s evidence about the union’s access to members on afternoon shift, Ms Fortescue notes that, prior to October 2010, there was an arrangement whereby a Team Leader or supervisor provided access to the premises. It is Ms Fortescue’s evidence that there is no need for a production supervisor to escort the union representatives during ROE visits on the afternoon shift.

[135] Ms Fortescue rejects Mr Howitt’s evidence as to his reasons for refusing the release of delegates to attend FWA proceedings in December 2011. Her evidence is that it is not Cochlear’s role to decide whether or not a delegate is required. She notes the important representative function of delegates especially during bargaining.

[136] Ms Fortescue provides details of a request for the release of three delegates to attend proceedings in these matters. It is her evidence that the company’s response to this request demonstrates that timeliness of requests is not an issue. Ms Fortescue’s opinion is that Cochlear does not respect the role and rights of delegates in bargaining.

[137] Ms Fortescue refers to the evidence of Mr Hargraves that the union did not provide its proposal of 22 December 2010 to the EBRs. She notes that, despite requesting them, the union has not been provided with any contact details for the EBRs other than Cochlear’s street address. Her evidence is that it was expected that Cochlear would hand on any material it received to the EBRs. Ms Fortescue’s evidence is that, following the 4th bargaining meeting, the AMWU posted the material to the EBRs at Cochlear’s address even though an email address would have provided for easier contact.

[138] It is Ms Fortescue’s evidence that the AMWU has never received any written response from the EBRs. The only responses have been in the bargaining issues table provided by Cochlear at the 8th bargaining meeting.

[139] In her oral evidence Ms Fortescue stated that, in her experience, the lunch area near the Mural Room tended to be used by white collar staff rather than production employees. She agreed that there was no prohibition on production employees using that area.

[140] Ms Fortescue testified as to the difficulties with employees having to heat their food, make their way to the Mural Room and then eat their meals with only a small table in the room. She noted that it was a cultural practice for many of the employees to share their food which was usually heated. Ms Fortescue’s evidence is that employees have tended to eat in the main lunchroom first before attending a meeting. She described this as a real disincentive to such attendance. Ms Fortescue estimated that it would take three minutes to walk from the main lunchroom to the Mural Room.

[141] Ms Fortescue was not aware whether there were queues for the microwaves in the lunch area near the Mural Room or whether there were any managers’ offices near the Mural Room. Ms Fortescue agreed that the Mural Room was approximately three metres by five metres in size.

[142] Ms Fortescue testified that during some ROE meetings there have been employees gathered in and around the doorway of the Mural Room. She testified that there had been complaints from the white collar employees about the noise of production employees gathering for meetings. Ms Fortescue’s evidence is that, during 2010 or early 2011, there had been ROE meetings where employees who wanted to attend had not been able to fit into the room. She estimated that this had occurred in the majority of such meetings, perhaps 90% of them. Ms Fortescue’s evidence is that the number of people attending the meetings varied depending on the particular work group and the timing of the lunch breaks.

[143] Ms Fortescue agreed that there is an AMWU noticeboard in the main lunchroom. Her evidence is that, prior to the cessation of the Code of Practice, she used to place notices on the board informing the employees that she was going to be on site. She did not recall using it for about two years but was not aware whether the delegates had been utilising it.

[144] Ms Fortescue confirmed that, since August 2009, the AMWU had been seeking paid meetings with employees. She testified that, during that period, the union had organised a number of Sunday meetings with Cochlear employees at the AMWU offices. Usually part of the discussion at those meetings concerned bargaining with Cochlear as well as other union matters. Ms Fortescue estimated that attendance at those meetings ranged from six or seven employees up to 15. She had not been present at all of the meetings. Ms Fortescue’s evidence is that even during meetings with individual Cochlear employees the issue of bargaining is raised.

[145] Ms Fortescue testified that the union had organised meetings of members on the nature strip in front of Cochlear’s premises. Sometimes these included barbeques. Ms Fortescue estimated that, since August 2009, there had been about 10 meetings without barbeques and about five or six with barbeques. It is Ms Fortescue’s evidence that the latter are better attended. Her evidence is that between 20 and 50 employees have attended each of the “non barbeque” meetings over the period 11.15am to 1pm and about 100 employees have attended the “barbeque” meetings over the same time period. Ms Fortescue’s evidence is that the union tries to exchange information and have discussions about bargaining at all of the meetings.

[146] Ms Fortescue testified that, in the period since August 2009, she has had only irregular telephone discussions about bargaining with Cochlear employees.

[147] Ms Fortescue testified that there are around three or four AMWU delegates at Cochlear who are elected by the members. There are other members who see themselves as activists. Ms Fortescue’s evidence is that most delegates and activists are on the morning/day shift. Her evidence is that employees generally don’t mix outside of their immediate workgroups and she agreed that the AMWU had sought to have representatives across the production site.

[148] Ms Fortescue testified that, in the last couple of years, she had contacted Mr Mason and other delegates and activists via their mobile phones rather than by way of a fixed phone in Cochlear’s premises. Her evidence is that this contact has not been regular, perhaps monthly or at longer intervals. Ms Fortescue testified that some of these calls have included discussions about bargaining.

[149] Ms Fortescue testified that, on one or two occasions, she had sent group emails relating to bargaining to Cochlear employees. Her evidence is that she has not used this form of communication more frequently because of the non-English speaking background of most of the employees. Ms Fortescue testified that she does not use broadcast SMS. Her evidence is that the union’s organising unit may use that form of communication with Cochlear employees.

[150] Ms Fortescue testified that, prior to putting forward the draft agreement in December 2010, the AMWU made its best efforts to communicate with members to identify what they wanted in an enterprise agreement. This included the conduct of a survey. Her evidence is that members’ responses were then used by the union in formulating the draft. This document was also provided to members via their home addresses. It is Ms Fortescue’s evidence that she did not receive any negative responses to the draft.

[151] Ms Fortescue recalled the organising unit conducting a ballot of members at Cochlear. She testified that flyers and leaflets have sometimes been used to notify employees of ROE visits and union meetings and barbeques. Ms Fortescue testified that the organising unit members provide general information to employees at Cochlear and other workplaces. Her evidence is that they don’t engage in in-depth discussions about bargaining or other industrial issues.

[152] In her re-examination Ms Fortescue described the meetings at the union offices as “not really effective”, those on the nature strip with barbeques as “moderately effective”, those without barbeques as “a lot less effective” and the use of group emails as “not that effective”.

[153] Mr Mason provided a witness statement dated February 2012. This was marked Exhibit AMWU 10. He also gave oral evidence which is at PN 3716-3899 of Transcript.

[154] Mr Mason has worked at Cochlear for more than 12 years and has been an AMWU delegate for about seven years. At the time of making his statement he was working part-time because of family reasons. By the time he gave his oral evidence, 23 March 2012, he had returned to full-time work. He works on the morning/day shift.

[155] It is Mr Mason’s evidence that he tries to be a delegate for all of his colleagues however there are limited opportunities for discussion. Part of the reason is the staggered morning and lunch breaks for different groups with minimal overlap. It is Mr Mason’s evidence that employees spend their lunch breaks in different areas. His evidence is that the main lunchroom can accommodate all production employees at one time. The other meal area fits about 30 people.

[156] It is Mr Mason’s evidence that there is no notification on noticeboards or announcements when the union attends the site for ROE purposes. There is no staff email. Mr Mason’s evidence is that he informs as many people as he can that the union will be on site, however, employees have lots to do at lunchroom and they are aware of how crowded the meeting rooms become. His evidence is that many more employees would attend if the meetings were held in the main lunchroom. No one has told him that they don’t want the union in that lunchroom.

[157] Mr Mason’s evidence is that he only talks to his co-workers about bargaining or union matters during breaks. The only time he was able to talk about bargaining during work hours was about three years ago when he was a member of the Employee Consultative Committee (ECC). Mr Mason’s evidence is that views were expressed in a meeting of that committee about why there should not be negotiations with the union for a collective agreement. Mr Mason provided the union’s perspective on the issue to the meeting. His evidence is that he was later reprimanded by managers and told that he was not to talk about union matters during work time.

[158] It is Mr Mason’s evidence that he is often asked about the progress of bargaining and about employees’ terms and conditions. His evidence is that his co-workers have told him that they want to see increased wages, an increased clean room allowance and additional notice of shift changes in an enterprise agreement.

[159] Mr Mason understands that Mr Howitt conducts monthly meetings. He does not usually attend as they are often held on days he does not work. However, at one of those meetings that he did attend in late November 2011, Mr Howitt asked employees if they thought it was right that Cochlear had to spend money and resources attending FWA because the AMWU had withdrawn from the Protocols. Mr Mason’s evidence is that several employees later asked questions about the issues which he attempted to answer.

[160] Mr Mason attended three bargaining meetings in 2011, the 6th, 8th and 10th meetings. His evidence is that, at the 6th meeting, Mr Junday stated that he represented all of the non-union employees in Mulberry B. That is a room in which a particular product was made but is no longer in operation. Mr Mason’s evidence is that the union was not told whether Mr Junday had provided Cochlear with any bargaining authorisation notices other than for himself.

[161] Mr Mason’s evidence is that, at the 8th bargaining meeting, Mr Junday provided an updated bargaining issues summary. Mr Mason’s evidence is that this appeared to be a commentary on the union’s claim only and not a separate claim. His evidence is that one of the EBRs stated that he represented more than 100 employees. Mr Junday said that he represented employees who didn’t want to change what the company was doing. Again, the union was not informed whether the EBRs had provided any bargaining authorisations to Cochlear.

[162] Mr Mason’s evidence is that most of the discussion at the 10th bargaining meeting concerned the failure of the Protocols.

[163] Mr Mason’s evidence is that, during December 2011, he had heard that Mr Junday was asking employees if they were union members and, if the answer was no, requesting that they sign a sheet of paper.

[164] In his oral evidence Mr Mason agreed that, during 2011, he averaged two days a week and that this factor and his need to go outside the premises to smoke had both restricted his ability to talk to fellow employees about bargaining. Other impediments include the staggered breaks.

[165] Mr Mason testified that he has attended about five to seven ROE meetings since August 2009. He estimated that an average of about 20-30 employees went to those meetings but noted that he wasn’t aware of how many attended at times he was not there. Mr Mason testified that the meetings were very crowded with a number of people standing in the doorway and in the room itself.

[166] Mr Mason testified that he was aware of the AMWU noticeboard in the lunchroom but had stopped putting notices on that board as they were taken down.

[167] Mr Mason testified that he had spoken to fellow employees about bargaining on some occasions in his lunch breaks and outside the premises usually on his way home. He agreed Cochlear had not impeded him in this regard. Mr Mason testified that he estimated that he has only been able to discuss bargaining issues with about 10% of employees.

[168] Mr Mason testified that he can be contacted by phone during work hours through his Team Leader or supervisor. He agreed that he had received calls or SMS messages on his mobile phone from Ms Fortescue or other AMWU representatives to notify him when ROE meetings were to take place. Mr Mason testified that he then passed the message on to as many people as possible but noted that he could only retrieve these messages during his breaks.

[169] Mr Mason agreed that Mr Howitt spoke only briefly about bargaining at the monthly meeting in November 2011. Mr Mason testified that he had attended delegate training in around 2006. He agreed that part of that training included communication with fellow employees.

[170] Ms Fan provided a witness statement dated 7 March 2012. This statement was in reply to Mr Howitt’s first statement, Exhibit Cochlear 32. Ms Fan’s statement was marked Exhibit AMWU 11. She also gave oral evidence which is at PN 3904-4028 of Transcript.

[171] Ms Fan has worked at Cochlear for more than 15 years and has been an AMWU delegate for about two years. In her oral evidence she clarified that she works on the afternoon shift.

[172] Ms Fan provides evidence of difficulties which would arise from Mr Howitt’s suggestion that the union could organise meetings at lunch times or at the end of shifts. Her evidence is that employees don’t want to stay around at the end of their shifts as they have been working since early morning and often have personal commitments such as collecting children from school.

[173] Ms Fan also refers to the different lunch times for employees and the fact that there are different lunch areas. Her evidence is that the Mural Room is very small and a long way from where most employees have lunch. She informs employees when the union is to be on site but few go to the meetings as they have so much to do during lunch and the breaks are short. Ms Fan also refers to queues to use the microwave ovens. It is Ms Fan’s evidence that employees know that the Mural Room is too small to eat in and there is too little time in which to have discussions after eating.

[174] Ms Fan’s evidence is that more employees would be able to talk to the union about negotiations if meetings were held in the main lunchroom. Her evidence is that employees ask her what is happening with the agreement and are disappointed that bargaining is taking so long.

[175] Ms Fan’s evidence is that, during December 2011, she observed Mr Junday walking around the workplace talking to employees. Some employees told her that Mr Junday was asking them to sign a sheet of paper if they weren’t union members.

[176] In her oral evidence Ms Fan confirmed that she has attended most of the ROE meetings. She also confirmed that, during those meetings, the union representatives tell employees about what has been happening in the bargaining process. It is Ms Fan’s evidence that around 10 employees go to each of those meetings, however, the room is so small that not many can fit inside. Some stand around the door to listen. Ms Fan testified that some employees carry their lunch because they cannot sit down to eat. She also testified that some employees don’t want to go to the meetings and some are scared that the boss is watching.

[177] Ms Fan agreed that she had spoken to many employees about the bargaining. She testified that, when she was on morning/day shift, she would come in early and answer questions from other employees. Ms Fan’s evidence is that she would only be able to speak to four or five employees at that time each week and about three or four people each week during her lunch breaks.

[178] Ms Fan attended the 10th bargaining meeting in November 2011. She testified that she didn’t say anything at that meeting and felt nervous that the managers might be angry. Ms Fan’s evidence is that, prior to that meeting, she found out what was happening in the bargaining by speaking to Ms Fortescue or another AMWU representative.

[179] Ms Fan testified that she had attended delegate training courses which had included training about bargaining. She had tried to put them into practice at Cochlear. Ms Fan testified that she had been involved in discussions with the AMWU about what should be in the draft agreement. She had also talked to other employees about the claim.

[180] Mr Simon provided a witness statement dated 7 March 2012. This statement was in reply to Mr Howitt’s first statement, Exhibit Cochlear 32. Mr Simon’s statement was marked Exhibit AMWU 9. He also gave oral evidence which is at PN 3575-3626 of Transcript.

[181] In 2007 Mr Simon was the AMWU Organiser with responsibility for members at Cochlear. His evidence is that he made ROE visits at the company’s premises in 2007. These included one in May 2007 at which he was accompanied by another union employee, Mr Kyriacou.

[182] It is Mr Simon’s evidence that employees had three separate lunch breaks. The union’s practice was to hold a “mass meeting” in the main lunchroom with all employees at one time rather than moving from table to table. Mr Simon’s evidence is that employees were asked if they had any objection to this but no one ever raised any issues.

[183] Mr Simon’s evidence is that, during the visit in May 2007, Mr Howitt informed him that the Code of Practice did not permit a mass meeting. Mr Howitt and Mr Kyriacou had a separate discussion which Mr Simon did not hear. His evidence is that Mr Kyriacou later told him that he had queried why managers were in the lunchroom during the visit.

[184] Mr Simon’s evidence is that, other than Mr Howitt, no one appeared shocked or angry or raised any objection. Shortly after this visit Cochlear wrote to the then State Secretary of the AMWU withdrawing privileges under the Code of Practice.

[185] In his oral evidence Mr Simon denied that during the May 2007 visit, he had yelled when asking employees whether they were okay with a mass meeting. He could not recall either Mr Kyriacou or himself telling employees that they should be scared, or that they had a right to have a delegate present during meetings with management or that managers could be fined if they refused such a request.

[186] Mr Simon’s evidence is that he did not recall anyone from Cochlear, other than Mr Howitt, informing him that he was breaching the Code of Practice.

[187] Mr Simon agreed that he would have expected that the union’s organising unit would have been involved in discussions with Cochlear employees from time to time especially about bargaining.

[188] Cochlear called three witnesses: Mr Hargraves, Director - Workplace Relations of Australian Industry Group and bargaining representative for Cochlear; Mr R Jarman, Group General Counsel and bargaining representative for Cochlear; and Mr D Howitt, Senior Vice President, Manufacturing and Logistics for Cochlear.

[189] Mr Hargraves provided four witness statements. The first was dated 8 February 2012 and became Exhibit Cochlear 21. The second statement was dated 23 February 2012 and was marked Exhibit Cochlear 22. This statement is in reply to the first statements of Mr Ayres, Exhibit AMWU 2 and Ms Fortescue, Exhibit AMWU 7 and the statement of Mr Mason, Exhibit AMWU 10. The third statement of Mr Hargraves is dated 7 March 2012 and is in reply to the second statement of Mr Ayres, Exhibit AMWU 3. This statement of Mr Hargraves was marked Exhibit Cochlear 23. The fourth statement of Mr Hargraves is dated 17 April 2012 and was marked Exhibit Cochlear 24. Mr Hargraves also gave oral evidence which is at PN 4642-5786 of Transcript.

[190] In his first statement Mr Hargraves notes that he was appointed as a bargaining representative for Cochlear on 21 October 2009. He was involved in all of the meetings relating to the negotiation of the Protocols as well as all of the bargaining meetings.

[191] It is Mr Hargraves’ evidence that Cochlear considered the AMWU’s proposal that there should be protocols to govern the bargaining process and decided that there was merit in having rules to follow. These would impose a discipline upon the bargaining and make meetings more structured and orderly.

[192] Mr Hargraves’ evidence is that the relationship between the parties during the negotiation of the Protocols was good. Each had very different views on a range of issues and strongly advanced their respective views. Mr Hargraves’ evidence is that Cochlear has a strong commitment to the Protocols as they are sensible and logical and have resulted in a fair, efficient and workable process. Cochlear has always expected the parties to comply with the Protocols.

[193] It is Mr Hargraves’ evidence that the AMWU has never suggested that there should be any amendment to the Protocols. Cochlear’s offer to discuss potential variations has not been accepted or responded to by the union. Mr Hargraves’ evidence is that it was only in response to correspondence from himself on 7 September 2011 that the union provided any formal indication that it was not happy with the operation of the Protocols. Mr Hargraves noted that the AMWU has not sought to engage in the dispute resolution procedure set out in the Protocols. He also notes that, in his correspondence of 7 September 2011, he advised the union that its failure to comply with the provisions of the Protocols amounted to a breach of the good faith bargaining requirements of the Act.

[194] It is Mr Hargraves’ evidence that Cochlear remains committed to bargaining in accordance with the Protocols. The company is prepared to discuss and consider amendments to the Protocols however none have been proposed.

[195] Mr Hargraves' evidence is that, during the course of bargaining, there have been times when the AMWU has not complied with the Protocols. This failure has hindered progress on making a new agreement. Cochlear has informed the union of its breaches on each occasion.

[196] For example, the AMWU has failed to explain the rationale of some of its claims. This is especially important in the context of achieving the objective of the Protocols to support the company’s competitive goals, improve productivity and provide job security. This breach was specifically raised in correspondence from Cochlear to the union on 22 June and 25 November 2011 and is dealt with in the Minutes of the 4th, 7th and 8th bargaining meetings.

[197] A further example of the union’s behaviour has been its failure to ensure that its delegate bargaining representatives attended all meetings. The Minutes show that two delegates were absent from the 1st meeting, one from the 2nd, two from the 3rd, three from the 4th, two from the 5th, two from the 7th, one from the 8th and two from the 9th.

[198] It is Mr Hargraves’ evidence that the AMWU failed to notify Cochlear and the EBRs of agenda items within the requisite time frame and failed to arrive at the scheduled time for multiple bargaining meetings. Mr Hargraves’ evidence is that the union was between five and twenty minutes late for the 3rd, 4th, 6th, 7th, 8th, 9th and 10th meetings. The union was advised of its breaches in these respects in correspondence of 23 June 2011.

[199] Additional examples of the AMWU’s breaches of the Protocols include its notification of a bargaining dispute without any prior consultation with Cochlear and its failure to refrain from making unfair and sensational public comment about the course of bargaining. This second matter arises from comments of the union’s National Secretary and was identified to the union in correspondence dated 25 November 2011.

[200] It is the evidence of Mr Hargraves that, despite the breaches of the Protocols by the AMWU, the Protocols have assisted in the conduct of orderly negotiations. His evidence is that the union has raised a number of issues which, without the Protocols, may have caused negotiations to break down.

[201] These issues have included the AMWU’s failure to table its claims pursuant to the agreed bargaining issues table. Mr Hargraves’ evidence is that, on numerous occasions, the union attempted to cease using the table and adopted a completely different approach. This occurred in the union’s materials of 22 December 2010 which weren’t in the agreed format. Mr Hargraves notes that the AMWU initially refused to follow the agreed process but ultimately did so. He also notes that the union initially refused to provide its documentation to the EBRs but later agreed to provide copies. Mr Hargraves’ evidence is that the AMWU also failed to provide sufficient particulars of its claim in the updated table which it provided on 22 March 2011.

[202] A further example of the importance of the Protocols has been in relation to the union’s opposition to signing the Minutes. Mr Hargraves’ evidence is that Cochlear believed that signing the Minutes was important as without this there was the potential for the union to dispute or walk away from the Minutes. Mr Hargraves provides evidence of the union’s delay in signing the Minutes for the 1st through to the 7th bargaining meetings.

[203] Additional matters raised by the AMWU include allegations of inaccuracies in Minutes after they had been received and signed. Mr Hargraves specifically relies upon the union’s actions in this regard in the 6th bargaining meeting. Another issue is the repeated requests by the union for paid meetings with employees. Mr Hargraves refers in particular to correspondence from the union to Cochlear dated 8 March, 4 November and 5 December 2011 and to Cochlear’s responses thereto.

[204] It is Mr Hargraves’ evidence that Cochlear formed an internal management committee to provide direction and assistance to its bargaining representatives. In addition to those representatives and Mr Howitt, the committee consists of the Chief Executive Officer of Cochlear, Dr Roberts, the Senior Vice President Human Resources, Ms Leslie and the Production Manager, Mr Lopez. This committee was also referred to in proceedings as the “IR Strategy Team”.

[205] Mr Hargraves’ evidence is that the committee meets weekly, is briefed on the AMWU’s positions and participates in the formulation of Cochlear’s responses. His evidence is that this is particularly important because of the participants’ depth of knowledge and experience in the business. The requirement of the Protocols that bargaining meetings occur no more frequently than at 14 day intervals has been vital to enabling the involvement of this committee.

[206] Further, it has been important to Cochlear that both of its bargaining representatives attend each bargaining meeting. Mr Jarman has extensive knowledge of the business and Mr Hargraves has considerable experience in industrial relations issues including the negotiation of enterprise agreements.

[207] In his second statement Mr Hargraves responds to the first statement of Mr Ayres, Exhibit AMWU 2 and Ms Fortescue, Exhibit AMWU 7 and the statement of Mr Mason, Exhibit AMWU 10.

[208] Mr Hargraves notes that the composition of Cochlear’s workforce has significantly changed since early 2009 when the AMWU discussed with and surveyed its members about their support for a collective agreement. He states that it is not apparent to him that in 2012 there is a strong level of support among employees for an agreement. Mr Hargraves refers to discussions with Production Supervisors as the basis for his view. He also notes that Cochlear employees have not taken any industrial action.

[209] Mr Hargraves’ evidence is that, during the negotiation of the Protocols, there were several discussions by the management committee about the issue of the number of union delegates who were to attend the bargaining meetings. Mr Hargraves’ evidence is that the union’s request for seven representatives was unreasonable. There were lengthy discussions about the implications upon the manufacturing operations of having that number of employees off the job at any particular time. Mr Hargraves confirmed his earlier evidence as to the limited attendance of the delegates at the bargaining meetings. His evidence is that, when they did attend, the delegates rarely contributed to the discussions.

[210] Mr Hargraves gives evidence about a meeting on 24 November 2009 which he initiated to attempt to reach agreement on bargaining protocols. His evidence is that Mr Ayres raised a number of issues about which there was an exchange of views. It was agreed that these matters be included in any protocol. Mr Hargraves’ evidence is that Cochlear considered in detail the issues which had been raised by the union and decided that the first two meetings should be about the parties’ bargaining objectives.

[211] Mr Hargraves rejects Mr Ayres’ evidence that Cochlear had taken the offer of a protocol, made it a precondition to bargaining and then used it to frustrate the negotiations. Mr Hargraves’ evidence is that, in his opinion, Mr Ayres expected that Cochlear would meet the union’s demands and did not accept that it had separate views which were different to those of the AMWU. Mr Hargraves’ evidence is that, when it became apparent that the company would not agree to the union’s terms, Mr Ayres became less committed to negotiating bargaining protocols.

[212] Mr Hargraves’ evidence is that Cochlear was especially concerned that negotiations did not unnecessarily disrupt production and supported a fair, efficient and structured bargaining process. He notes that, even if there were no protocols, issues such as where meetings would be held, who would attend and the conduct of representatives would still have needed to have been agreed before bargaining could begin.

[213] Mr Hargraves refers to a meeting of 4 December 2009 and notes that Cochlear informed the AMWU at that meeting that it had accepted that protocols should be adopted. His evidence is that there was considerable disagreement between the parties about the proposed terms. Extensive discussions led to movement on both sides however agreement was not reached. Mr Hargraves notes that Mr Ayres was unavailable for another meeting until the end of January 2010.

[214] Mr Hargraves’ evidence is that Cochlear was extremely concerned with allegations contained in an email from Mr Ayres dated 4 January 2010 that several of the company’s proposals for the protocols did not accord with the requirements of good faith bargaining. His evidence is that the allegations were discussed in subsequent management committee meetings and led to a response on 15 January 2010 which required the AMWU to clarify in writing the basis upon which Cochlear’s actions were said to be in bad faith.

[215] The next meeting of the parties was held on 5 February 2010. It is Mr Hargraves’ evidence that there were discussions about a number of issues including the matter set out in the previous paragraph. No agreement was reached.

[216] Mr Hargraves’ evidence is that he reiterated the seriousness of the company’s views about the allegations made against it in a telephone conversation with Mr Ayres on 17 February. This was followed by correspondence from Cochlear which invited the AMWU to either retract the allegations or to particularise them. It is Mr Hargraves’ evidence that the union did neither.

[217] The issue of the allegations was the subject of further correspondence between the parties. Mr Hargraves’ evidence is that, despite the union’s failure to explain its allegations, Cochlear ultimately proposed a date for the next meeting. His evidence is that the union’s actions had caused unnecessary delays.

[218] It is Mr Hargraves’ evidence that the negotiations which led to the Protocols had been hard fought and notes that both parties held strong views about key elements.

[219] Mr Hargraves provides evidence about the commencement of the substantive bargaining including the 1st, 2nd and 3rd bargaining meetings. He notes that, at the 2nd meeting, it was emphasised that parties would be expected to follow the Protocols.

[220] Mr Hargraves rejects Mr Ayres’ characterisation of Cochlear’s list of questions about the union’s claim as being argumentative. Mr Hargraves’ evidence is that he formulated the questions which were then the subject of discussion by and input from the management committee. His evidence is that the questions were fair and required the union to provide satisfactory responses.

[221] Mr Hargraves states that those responses were generally of poor quality and failed to justify the claims. For example, the union provided no quantifiable data to support its position that a 5% pay claim was reasonable because of cost of living and productivity increases. A further example concerned the application of the 5% increase to bonuses which are paid to employees. Mr Hargraves’ evidence is that the AMWU responded to the questions with unsupported contentions rather than proper substantiation of its claims.

[222] It is Mr Hargraves’ evidence that he did not recall Mr Ayres expressing any reservations about Cochlear’s list of questions. He notes that the Minutes of the 5th bargaining meeting indicated that the union was happy to answer questions but reserved its right to go to FWA. Mr Hargraves agreed that Cochlear had not provided any counter proposals to the union’s claims in November 2010. His evidence is that the reason for this was that it had been agreed that parties representing employees were to provide details of their claims in the bargaining issues table prior to Cochlear responding to all of those claims.

[223] It is Mr Hargraves’ evidence that the AMWU can consult with its members at Cochlear’s premises using the ROE provisions of the Act. It can also hold meetings at other venues, distribute flyers and use the delegates to communicate bargaining progress to employees.

[224] Mr Hargraves notes that the AMWU provided its draft agreement and bargaining issues table on 22 December 2010. Mr Ayres was on annual leave in January 2011 and unavailable to meet. The 4th bargaining meeting was held on 24 February 2011. It is Mr Hargraves’ evidence that there was discussion about the use of the bargaining issues table as the single document to specify claims. His evidence is that it became apparent at this meeting that the EBRs had not been served with the AMWU material. The union agreed to provide copies of the documents and to utilise the table.

[225] Mr Hargraves’ evidence is that, on 8 March 2011, the AMWU requested a series of paid meetings. His evidence is that the management committee considered the request but it was declined for reasons including that bargaining was not at a sufficiently advanced stage, the meetings would have a detrimental impact on production for minimal, if any, benefit and there was no legal requirement for the meetings. It is Mr Hargraves’ evidence that it is not the usual practice within industry to grant regular paid meetings to advise employees of the progress of negotiations especially at an early stage.

[226] Mr Hargraves provides similar evidence in relation to another request dated 6 December 2012 (sic) for a paid meeting. He notes that such a meeting was not appropriate at that time as there had been no substantive negotiations for three months.

[227] It is the evidence of Mr Hargraves that the first statement of Mr Ayres omits a number of important events between March and June 2011 and delays in negotiations at that time which were caused by the AMWU. These included: the delay of a month between Cochlear’s request for and the union’s provision of the updated bargaining issues table; the last minute cancellation of a bargaining meeting by the AMWU in March followed by its request for a rapid response to proposed dates for future meetings; Mr Jarman’s absence overseas on Cochlear’s business in early May; and ongoing correspondence in April and May about the use of the bargaining issues table. Mr Hargraves’ evidence is that Cochlear believed that it was not unreasonable that all claims should be in one document so that it could consider their impact.

[228] It is Mr Hargraves’ evidence that, at the 5th bargaining meeting, there was intense discussion about whether any agreement should be a standalone comprehensive document, Cochlear’s preference, or one which incorporated the Manufacturing and Associated Industries and Occupations Award 2010 (the Award), the union’s preference. His evidence is that, at this meeting, the company continued to pursue its questions about the union’s claims but received unsatisfactory or no answers. Examples included the no extra claims and eye examination clauses. It is the evidence of Mr Hargraves that the union seemed indignant and frustrated that it should have to substantiate its claims.

[229] Mr Hargraves notes that on 7 June 2011 the union provided Cochlear with notice pursuant to section 229 of the Act.

[230] Mr Hargraves disagrees with Mr Ayres’ assertion that Cochlear’s refusal to provide a substitute representative for Mr Jarman was an example of the Protocols being used to frustrate negotiations. He notes that the company had accommodated Mr Ayres’ leave commitments.

[231] Mr Hargraves’ evidence is that Mr Ayres misrepresented the company’s position set out in Mr Hargraves’ email of 20 August 2011. Mr Hargraves disagrees with Mr Ayres’ view that Cochlear’s response of 30 August 2011 demonstrated that it had no intention of reaching agreement as the company’s proposal could not be approved under the Act. Mr Hargraves’ evidence is that Cochlear’s response was reasonable and did not offend the Act including the operation of the BOOT.

[232] It is Mr Hargraves’ evidence that the company’s proposal was put as a package. If the union rejected the proposal it was natural to conclude that all elements of the package had been rejected. Mr Hargraves’ evidence is that Cochlear believed it was making a major concession to the AMWU but in return sought the union’s agreement to the company’s approach.

[233] Mr Hargraves’ evidence is that, in arriving at its response to the union’s claim, Cochlear’s management committee had discussed the issues on an item by item basis over the course of several meetings. There was considerable debate about the impact of each item on the business.

[234] Mr Hargraves rejects Mr Ayres’ characterisation of Cochlear’s requirement that the union’s claims be substantiated on the basis of their contribution to the company’s international competitiveness as being an artificial and arbitrary constraint designed to frustrate agreement. The importance of Cochlear’s international competitiveness was the subject of discussion during bargaining meetings and was part of the Protocols.

[235] Mr Hargraves disputes Mr Ayres’ assertion that, at almost all meetings, the union requested paid meetings with employees. His evidence is that such an assertion is not reflected in the Minutes. Further, he received only two formal requests. Mr Hargraves notes that the AMWU has had access to employees through meetings conducted during meal breaks and has also communicated by means of flyers.

[236] Mr Hargraves confirms Mr Mason’s recollection of Mr Junday’s and/or Mr Naing’s statements at the 7th and 8th bargaining meetings about the employees which they represent.

[237] Mr Hargraves notes that the Minutes of the bargaining meetings are only summaries. He believes them to be accurate. Mr Hargraves notes that the AMWU was provided with the opportunity to review each set of draft Minutes and propose amendments. Mr Hargraves also provides the transcript of each bargaining meeting which was recorded by a Cochlear representative.

[238] Mr Hargraves refutes Ms Fortescue’s evidence that Cochlear has never accepted the AMWU’s right to negotiate an agreement. His evidence is that, since his involvement in December 2009, it has been apparent to him that Cochlear has always accepted the legitimacy of the AMWU and its right to seek an enterprise agreement.

[239] Mr Hargraves’ evidence is that the AMWU has never raised any complaints about actions of Team Leaders to prevent discussion among employees of matters concerning bargaining and unions.

[240] Mr Hargraves rejects Ms Fortescue’s characterisation of his correspondence of 27 April 2011 as simply delaying bargaining for no useful purpose. His evidence is that the union’s failure to provide its material to the EBRs was disrespectful and unfair. They were entitled to receive such material.

[241] In his third statement Mr Hargraves responds to the second statement of Mr Ayres, Exhibit AMWU 3. Mr Hargraves disagrees with Mr Ayres’ evidence that the Protocols had become an obstacle to good faith bargaining. Mr Hargraves’ evidence is that the only obstacle was the union’s unwillingness to comply with key aspects of the Protocols. His evidence is that, if the union had done so, bargaining would have been far more advanced.

[242] It is Mr Hargraves’ belief that one of the reasons the union withdrew from the Protocols was to pursue a political agenda by attempting to influence the Commonwealth Government to pursue more “union friendly” bargaining provisions in the Act. Mr Hargraves refers to the AMWU’s submission concerning the review of the Act and notes that unfair and sensational comments about Cochlear contained therein would have been prevented by the Protocols.

[243] Mr Hargraves responds to the evidence of Mr Ayres as to the reasons for which Mr Ayres says the Protocols had become unworkable. Mr Hargraves’ evidence is that the two hour limit on the duration of meetings was to enable all representatives to plan their time. He agreed with Cochlear that a time limit was appropriate. His experience is that, absent any such limit, meetings can drag on without progress.

[244] Mr Hargraves disputes Mr Ayres’ suggestion that Cochlear insisted on strict adherence to the time limitation. He refers to the transcripts of bargaining meetings referred to earlier. Mr Hargraves also disputes Mr Ayres’ evidence that discussions were cut off at an arbitrary point other than on one occasion when the meeting had become heated. Mr Hargraves’ evidence is that he could only recall one instance when the union sought to have the length of a meeting extended.

[245] It is Mr Hargraves’ evidence that the two week minimum period between meetings was reasonable given the need for Cochlear to formalise coordinated responses. This process included meetings of the management committee which are programmed months in advance. The involvement of each member of this committee is essential to the process. Mr Hargraves’ evidence is that the period of time also enabled the Minutes to be finalised. That procedure included a review of the notes of the meeting, a consideration of Cochlear’s responses and, at times, the preparation of correspondence to the AMWU seeking clarification of an issue.

[246] Mr Hargraves’ evidence is that, during negotiation of the Protocols, he informed the AMWU that meetings would not be scheduled just for the sake of it. His experience is that there needs to be a reasonable time between bargaining meetings for parties to consider what has been put and to formulate a response. Mr Hargraves’ evidence is that a shorter interval between meetings would not have been possible. Further, he states that the main reasons for delays were the actions of the union and the unavailability of the representatives. Mr Hargraves gives evidence of events and interactions between the parties between the 9th and 10th bargaining meetings, 16 August to 2 November 2011. His view is that none of the delay after Mr Jarman’s return from leave on 23 September can be attributed to Cochlear.

[247] Mr Hargraves’ evidence is that, when the Protocols were being negotiated, both parties agreed that it would be inefficient to change representatives during the bargaining process. He notes that the AMWU did not request the substitution of representatives when Mr Ayres was on leave. Mr Hargraves’ evidence is that Cochlear had considered the impact on production of the absence of employees attending bargaining meetings. He does not recall the AMWU ever indicating that the delegates had problems attending the meetings. Mr Hargraves confirms his earlier evidence that Cochlear had given appropriate consideration to each request for a paid meeting of employees.

[248] Mr Hargraves disputes Mr Ayres’ view about the dispute resolution clauses of the Protocols. If the union had raised a dispute under those provisions, Cochlear would have been obliged to discuss who might be the mediator/conciliator. The AMWU did not raise any such dispute nor did it seek to vary the relevant clauses or indeed any other clause of the Protocols.

[249] Mr Hargraves’ evidence is that it is not uncommon for parties to agree upon and use bargaining protocols. He notes that the AMWU proposed such a course shortly after the MSD was issued. Mr Hargraves’ evidence is that the union’s proposed protocols of August 2009 were an ambit claim. They were not agreed to by Cochlear as they were not workable. Mr Hargraves’ evidence is that the delay in negotiating the Protocols was due to the strong views of the parties on many issues. He does not recall Cochlear agreeing to and then later rejecting any matters.

[250] Mr Hargraves disputes Mr Ayres’ evidence that he had raised concerns at the 5th and 6th bargaining meetings about the workability of the Protocols or that the union was intending to repudiate them. Mr Hargraves’ evidence is that his instructions are that Cochlear is always willing to consider renegotiating the Protocols but that the union has not sought to do so. He does not recall the AMWU raising concerns about the effectiveness of any such renegotiation.

[251] Mr Hargraves accepts that on some occasions Cochlear did not provide agenda items on time however he recalls that the AMWU was late on most occasions. He recalls one bargaining meeting being delayed because the EBRs had been confused about the date of the meeting and in his fourth statement he notes that there had been a miscommunication with the receptionist. However Mr Hargraves does not recall any delays due to lateness of Cochlear representatives.

[252] Mr Hargraves disputes Mr Ayres’ evidence about the unequal bargaining positions of the parties because of the ability of Cochlear’s management committee to consult widely. Mr Hargraves’ evidence is that the role of the committee is to consider claims and formulate responses. It is no different to the AMWU officials meeting and discussing the union’s bargaining position.

[253] In his fourth statement Mr Hargraves supplements his earlier statements and responds to some of the oral evidence of the union’s witnesses. He confirms his earlier evidence that the AMWU is pursuing a political agenda and notes the considerable union resources which have been deployed at Cochlear. These include National and State Officials, organisers and two former Cochlear employees currently employed by the union. Mr Hargraves’ evidence is that the magnitude of such resources for a single site is unprecedented.

[254] Mr Hargraves gives evidence about the process of putting items onto the agendas for the bargaining meetings. He does not recall difficulty reaching agreement as to what was to be on the agenda. He notes that Mr Ayres had not advised him that the development of agenda items was a problem. Mr Hargraves further notes that Cochlear did not refuse to include any items put forward by the union even if they were late. He confirms his earlier evidence about the failings of the AMWU in relation to the bargaining issues table.

[255] Mr Hargraves recalls only two occasions when the union advanced reasons for the absence of its delegates, at the 2nd and 9th bargaining meetings. Both concerned Mr Mason’s personal circumstances. Mr Hargraves does not recall the union raising any other concerns about obstacles to delegates attending the bargaining meetings. His evidence is that the number of such delegates was the most time consuming issue in the negotiations for the Protocols.

[256] It is the evidence of Mr Hargraves that the Protocols required that, before the union notified a bargaining dispute under section 240 of the Act, it should have held discussions with Cochlear. The union did not even attempt to do this. Mr Hargraves refers to documents in Mr Junday’s possession at the FWA proceedings in relation to this dispute on 5 December 2011. His evidence is that it appeared to be well in excess of 50 pages. Mr Hargraves’ evidence is that he understood that these documents were authorisations from other employees for the EBRs to act as bargaining representatives. He has always had the understanding that the EBRs represented between 80 and 100 employees.

[257] Mr Hargraves gives evidence about the Minutes and specifically about requests by the AMWU to amend the Minutes of the 3rd and the 4th bargaining meetings. He notes that, although he questioned the legitimacy of the AMWU’s position in relation to the 3rd meeting, he made the concession in order to move forward.

[258] In his oral evidence Mr Hargraves agreed that it was unusual for the rules of bargaining to take almost 12 months to negotiate but disagreed that this was unsatisfactory or that it was unsatisfactory for a party to take eight months to respond to a draft agreement. He also disagreed there was something seriously wrong with the bargaining between Cochlear and the AMWU.

[259] Mr Hargraves testified that he understood Cochlear wanted the MSD ballot to be unsuccessful and had resisted bargaining with the union. He denied that was still the company’s position or that it had used delaying tactics in the negotiations. Mr Hargraves specifically denied discussions with Mr Jarman or Mr Howitt about the desirability of slowing down the process. He also denied that Cochlear did not wish the AMWU to have any “victory or win”.

[260] Mr Hargraves testified that, from shortly after being appointed as a bargaining representative, he was aware that the union was seeking paid meetings and also that the AMWU considered that the meeting room which had previously been allocated was unsatisfactory. His understanding was that Cochlear didn’t say that the main lunchroom could never be used for such meetings but that there were issues with the use of that room.

[261] Mr Hargraves testified that he formed the view that the AMWU had sought the use of the main lunchroom so that it had access to a greater number of employees. Cochlear’s position was that, when negotiations had substantially progressed towards an agreement, the company would grant a paid meeting.

[262] Mr Hargraves testified that, prior to the 3rd or 4th bargaining meetings, he did not know how many employees were being represented by the EBRs. He then became aware that the EBRs had said that it was 80 to 100 employees. Mr Hargraves agreed that, during FWA proceedings in December 2011, Mr Junday had indicated that the EBRs represented at least 57 employees. Mr Hargraves testified that he did not know if any, or how many, notices of appointment were provided to Cochlear. His evidence is that he attempted to treat the EBRs in the same way as the AMWU and was not particularly interested in how many employees they were representing. Mr Hargraves agreed that it was not usual for employees not to want a wage rise or an increase in an allowance.

[263] Mr Hargraves disagreed that Cochlear wanted only two employee bargaining representatives or that it had controlled the numbers. He testified that he recalled discussions with Mr Jarman about the issue and had advised that the company should not attempt to influence the numbers or the identities of any representatives. Mr Hargraves testified that he understood that the EBRs had been provided with some administrative assistance by Cochlear’s human resources specialists.

[264] Mr Hargraves agreed that, in mid February 2011, he had become aware that the EBRs had not received the AMWU’s draft agreement and bargaining issues table. He denied that he should have drawn this to the union’s attention or that Cochlear used this as a strategy to delay negotiations. He noted that it was the AMWU’s obligation to provide the material to the EBRs. Mr Hargraves agreed that, at this point, Cochlear hadn’t decided whether it wanted a comprehensive or a stand-alone agreement. The issue was still under active consideration.

[265] Mr Hargraves gave evidence about the Fair Work Principles and the related User Guide and the requirements therein concerning dispute settlement provisions. A copy of the Principles and an extract from the November 2011 version of the User Guide are at Exhibit AMWU 33. A copy of that version of the complete User Guide is at Exhibit Cochlear 37. I note that there is a July 2012 version of the User Guide however there has been no change to the relevant parts.

[266] Mr Hargraves testified that this had been identified as a relevant issue early in the bargaining process and was just one of the obstacles in the bargaining. His evidence is that, as at 30 April 2012, Cochlear was proposing a clause which provided for consent arbitration. It should be noted that it is this clause which is referred to at Order 5 of the AMWU’s proposed orders. Mr Hargraves agreed that, prior to 30 April 2012, Cochlear had not been prepared to entertain a provision which allowed for arbitration. He denied that this was a delaying strategy.

[267] Mr Hargraves agreed that, by mid March 2011, Cochlear was aware of the substance of the position of the EBRs. He also agreed that the EBRs should have been able to articulate their position at that time. However Mr Hargraves testified that, until the EBRs had put their items into the bargaining issues table, their position was not finalised. They could have modified their views. Mr Hargraves denied that this was a further example of the delaying strategy of Cochlear. The EBRs finally tabled their position in July 2011 although they provided some input on it during the 7th bargaining meeting, 28 June 2011.

[268] Mr Hargraves testified that he did not question how the EBRs were communicating with those they represented. He agreed that the position advanced by the EBRs was that they wanted to be involved in the bargaining process, they did not support the AMWU position, they were generally happy with their terms and conditions and they did not advance any claim of their own.

[269] Mr Hargraves testified that Cochlear was keen to have the Protocols finalised before substantive bargaining began. He disagreed that this was a delaying tactic. He also disagreed that requesting the AMWU to particularise its allegations in January 2010 that Cochlear was breaching the good faith bargaining requirements of the Act was for the purposes of delay. Mr Hargraves disagreed that the allegations of the AMWU were merely robust comments.

[270] Mr Hargraves agreed that Cochlear introduced new items into the draft protocols in April 2010. His evidence is that the issues had been previously discussed by the parties. Mr Hargraves agreed that the AMWU had never required that there be protocols for bargaining.

[271] Mr Hargraves disagreed that the clauses in the Protocols which named bargaining representatives and gave them the right to have meetings postponed gave rise to the capacity for significant delay in negotiations. He denied the clauses were introduced for that reason.

[272] Mr Hargraves testified that the two week minimum period between meetings had proved to be an accurate reflection of the time Cochlear needed to consider what had been put and to respond. He testified that it would have been difficult for the management committee to have conducted its deliberations by email. He disagreed that the period of time over which the company had questioned the union about its claims had been unreasonable although he did agree that the two hour maximum duration of meetings had been a contributing factor. Mr Hargraves testified that another factor was the long winded answers from the union which often required additional discussion and questioning. The availability of Mr Ayres was also an issue.

[273] Mr Hargraves confirmed that Cochlear was considering the competitiveness goal in the Protocols from two perspectives: there should be no new restrictions which would take the business backwards as well as the requirement for the introduction of new benefits such as improved flexibility. He testified that the union’s claim for additional workplace delegates was a significant impediment to Cochlear’s goal. Mr Hargraves testified that the AMWU could have put forward suggestions such as improved flexibility in relation to the span of hours or time off in lieu of overtime.

[274] Mr Hargraves testified that the AMWU also failed to properly address the productivity goal in the Protocols. He testified that what the union had proposed would take Cochlear backwards. Mr Hargraves testified that the company had some ideas of its own but decided not to advance them. His evidence is that, until the AMWU introduces or agrees to the type of terms referred to in the preceding paragraph, it will be in breach of its own good faith bargaining obligations.

[275] Mr Hargraves agreed that if his proposed order was not granted the AMWU officials would cooperate to facilitate meetings. However he testified that, in the absence of the Protocols, it would still be necessary to deal with all of the issues that are contained in it.

[276] Mr Hargraves agreed that there was nothing particularly unusual about the AMWU’s claim. By the date the union provided the draft agreement, 22 December 2010, Cochlear knew what the union was seeking. Mr Hargraves testified that there were still some areas of uncertainty and disagreed that Cochlear was in a position to have prepared a useful response at that time.

[277] Mr Hargraves testified that many of the questions put to the union about its claims were to test the validity of the issues and the level of support among employees. He testified that the concept of make up time is not relevant in the context of Cochlear’s business. Mr Hargraves agreed that it would have been difficult for the union to have undertaken a total costing analysis of its claim however questions about the cost were designed to focus attention on the implications of the claim.

[278] Mr Hargraves agreed that, until Cochlear’s proposal of 30 April 2012, the company had always maintained that it would not agree to wage rates being included in an agreement. The company considered that any agreement would be a safety net agreement only. It is Mr Hargraves’ evidence that, absent wage rates, employees would still be better off and any such agreement would pass the BOOT. Mr Hargraves testified that before putting its response of 30 August 2012 the company considered its competitiveness and productivity goals. Its proposals were directed to flexibility and maintaining its agility in the market. Mr Hargraves denied that Cochlear’s proposal was intended to further delay the bargaining process.

[279] Mr Jarman provided a witness statement dated 22 February 2012 which was marked Exhibit Cochlear 26. This statement was in response to the first statements of Mr Ayres, Exhibit AMWU 2 and Ms Fortescue, Exhibit AMWU 7 and the statement of Mr Mason, Exhibit AMWU 10. Mr Jarman also gave oral evidence which is at PN 5791-8707 of Transcript.

[280] In his statement Mr Jarman notes that, due to his global role, he frequently travels overseas. His schedules permit him to provide only limited input into matters occurring in Australia during his absences. Mr Jarman also notes his involvement in the management committee meetings and as bargaining representative for the company. He has provided legal advice to Cochlear in relation to this matter and, at times, has sought external advice.

[281] Mr Jarman clarifies the context in which he had made certain statements in correspondence to the AMWU in July 2009. He sets out reasons for his doubts as to the union’s contention at that time that there was majority support for bargaining. Mr Jarman notes that Cochlear had concerns about the substance of the union’s surveys of members and reasonable doubts about the accuracy of the outcomes. Mr Jarman’s evidence is that FWA’s decision to order a secret ballot showed that the company’s concerns were justified.

[282] Mr Jarman refers to AMWU correspondence of 26 August 2009 and notes that it made various allegations about what was said to be inappropriate conduct by Cochlear but then provided the company less than eight hours to respond. Mr Jarman’s evidence is that it appeared to him that the union was seeking to adopt a highly formal, structured and adversarial approach to negotiations.

[283] Mr Jarman details Cochlear’s concerns about an assertion by the AMWU that its bargaining committee included eight employees. First, the 2005 Agreement only provided for the two delegates, one from each shift. Mr Jarman’s evidence is that Cochlear believed that the AMWU’s assertion was part of an ambit claim at the start of negotiations as well as to provide a platform for a greater number of delegates to be recognised in any agreement. Secondly, the removal of eight employees from the workplace would have a serious impact on production capabilities. Mr Jarman’s evidence is that this was a particular concern at that time because the company was in the process of rolling out a new device and supply was constrained. Thirdly, there may have been a need for some non-union bargaining representatives to be released from production also. Mr Jarman’s evidence is that Cochlear also had concerns about the status of employees as bargaining representatives.

[284] Mr Jarman provides evidence of further exchanges between the AMWU and Cochlear during August and September 2009. He rejects Mr Ayres’ contention that Cochlear had proposed a two month delay before the start of bargaining. Mr Jarman’s evidence is that, although he sought a delay for the first meeting, he had suggested that the parties could develop their views about an appropriate bargaining framework through correspondence.

[285] Mr Jarman rejects Mr Ayres’ characterisation of Cochlear’s correspondence dated 24 September 2009 as being simply a rejection of the union’s request. He notes that the correspondence identified a number of issues including: continuing concerns in relation to the number of delegates sought by the AMWU; Cochlear’s willingness to allow paid leave for two delegates to attend bargaining training; a request that the union provide seven days’ notice of ROE visits during the afternoon shift to accommodate security and supervision concerns; and, Cochlear’s preparedness to consider having agreed bargaining protocols in the future.

[286] Mr Jarman’s evidence is that Cochlear continued to have concerns about the number of delegates sought by the AMWU even after that number had been reduced.

[287] Mr Jarman rejects Mr Ayres’ characterisation of the actions of Cochlear’s management in late 2009 as frustrating the negotiations. He refers to the company’s prompt responses to union correspondence and contrasts this with the AMWU’s tardiness. He also refers to the company’s appointment of a replacement bargaining representative and the substantial exchange of correspondence once Mr Hargraves had been appointed. Mr Jarman notes that Cochlear negotiated and agreed the terms of the Protocols.

[288] Mr Jarman rejects Mr Ayres’ contention that in correspondence dated 15 January 2010 Cochlear refused to meet with delegates. His evidence is that it is important to consider the context of the letter. Cochlear had highlighted several operational matters that it considered needed to be looked at in developing any protocols. These included issues such as the frequency, location and scheduling of meetings and ensuring that meetings served a purpose. Mr Jarman’s evidence is that the AMWU’s responses indicated that the union was not concerned about these matters.

[289] Mr Jarman gives evidence about the interactions of the parties following the AMWU’s allegations of 4 January 2010 that Cochlear was in breach of the good faith bargaining requirements of the Act. His evidence is that, if the allegations had a legitimate legal basis, there was a risk that the company’s future proposals might also offend. Mr Jarman’s evidence is that, following a meeting of the parties on 31 March 2010, he concluded that the allegations were spurious.

[290] Mr Jarman’s evidence is that the negotiations about the protocols were extremely vigorous with both parties expressing strong views about a range of issues. His evidence is that Mr Ayres did not inform him that he was unhappy about Cochlear’s request for certain inclusions in the documents.

[291] Mr Jarman’s evidence is that he believes that the AMWU was leading the direction of the bargaining process. It was the union which suggested that there be protocols and the use of a bargaining issues table. Mr Jarman believes that both have been beneficial to the substantive negotiations.

[292] Mr Jarman’s evidence is that Mr Ayres signed all except two sets of Minutes without amendment. Mr Jarman notes that he was angry that Mr Ayres would not sign the Minutes of the 3rd bargaining meeting unless the reference to Mr Junday’s assertion about who he represented was deleted. He believes this was done for strategic purposes. Mr Jarman’s evidence is that he had been informed that the EBRs represented between 80 and 100 employees, including some union members.

[293] Mr Jarman provides evidence about the management committee and its processes. He notes that its main driver is to ensure that any agreement does not impose additional burdens or impediments on the business in relation to flexibility and productivity. Mr Jarman also notes that Cochlear sees itself as an innovation company rather than a manufacturing one. It runs a lean operation with small production teams. Mr Jarman’s evidence is that the committee considered and discussed each of the issues and responses put forward by the AMWU.

[294] Mr Jarman refers to Cochlear’s list of questions given to the AMWU in November 2010. His evidence is that the union had not provided supporting information for its claims and the company needed that information to properly consider what the union wanted, whether they were ambit claims and the possible impact on the business.

[295] Mr Jarman’s evidence is that the management committee discussed the union’s response but agreed that it was inadequate. Some claims required further clarification or justification and some questions had not been answered at all or the answers raised additional questions. The committee decided to ask the AMWU to identify all of the clauses it wanted in an agreement and place them in the bargaining issues table.

[296] Mr Jarman’s evidence is that the union’s response only served to complicate the table and made it difficult to use. The information provided was still inadequate to properly assess the impact of the claims on the business. His evidence is that, during the next three bargaining meetings, the 5th, 6th and 7th meetings, Cochlear continued to seek further information from the union. The committee considered it had then exhausted the process of information gathering although there were still some gaps.

[297] Mr Jarman agrees that Cochlear’s written response was not provided to the AMWU until 30 August 2011 however his evidence is that the company had explained its position in the previous two bargaining meetings, the 8th and 9th meetings.

[298] Mr Jarman’s evidence is that he was surprised to receive a draft agreement from the union in December 2010 as it has been decided that negotiations should revolve around the bargaining issues table. His evidence is that the committee adopted his recommendation to continue with the table as, in his experience, the most efficient approach to negotiations is to identify and resolve issues before attempting to draft any document.

[299] Mr Jarman’s evidence is that the management committee considered each of the union’s requests for paid meetings. On each occasion the request was not granted. Mr Jarman’s evidence is that, in making these decisions, the committee had regard to issues such as costs and lost production. The organisation of the business meant there would be a need for four separate and sequential meetings with one or more production areas being closed during each meeting. There would also be additional downtime shutting down then ramping up each production area. Some areas might need to be shut for more than one meeting. Further, the purpose of the meeting did not justify the cost and impact on the business.

[300] Mr Jarman’s evidence is that Mr Ayres had indicated to him that the union was happy for Cochlear to provide a wage increase to employees each July.

[301] Mr Jarman disagrees with Mr Ayres’ evidence that the position of the EBRs was identical to that of Cochlear. His evidence is that there are significant differences between their position and that of the company. Mr Jarman’s evidence is that he has been very conscious of ensuring that the EBRs were independent and free from any influence by the company. He notes that he did offer some administrative assistance to the EBRs in providing their input into the bargaining issues table. He understood that other minimal assistance had been provided.

[302] Mr Jarman’s evidence is that Cochlear did not agree to provide a substitute representative while he was on leave because it was important to have continuity of representatives so as not to disrupt negotiations. Furthermore, it was consistent with the Protocols. He notes that, in any event, a meeting could not be held at that time because of the absence of Mr Ayres.

[303] Mr Jarman rejects Mr Ayres’ allegations that Cochlear had changed its position on whether it would advance any claims of its own or that the company had no intention of ever reaching agreement. His evidence is that Cochlear had advised the union that it was not under any obligation to put counter proposals. Further, Cochlear has always intended that any agreement would be capable of passing the relevant statutory tests. The offer of 30 August 2011 was simply Cochlear’s first proposal.

[304] Mr Jarman also rejects Mr Ayres’ statement that the company’s focus on its competitiveness and productivity had been an arbitrary constraint on negotiations. His evidence is that Cochlear’s main objective has been to derive a net benefit from any agreement. International competitiveness is one measure of this. This had been communicated to the union from the commencement of bargaining. Mr Jarman’s evidence is that the union has yet to provide an adequate response.

[305] Mr Jarman notes that Cochlear has provided the union with a detailed position. There is no need to provide a draft agreement. It is the union which has failed to provide a proper response and indeed has ceased bargaining.

[306] Mr Jarman’s evidence is that the notes of the bargaining meetings attached to Ms Fortescue’s statement are not accurate transcripts. He rejects Ms Fortescue’s allegation that Cochlear has been obstructive in relation to ROE meetings on the afternoon shift. Mr Jarman refers to the particular operational and security issues of that shift.

[307] Mr Jarman disagrees with Mr Mason’s evidence that most of the 10th bargaining meeting was taken up with discussions about the failure of the Protocols. His evidence is that a number of other issues were discussed at some length. Mr Jarman’s evidence is that the meeting was predominately led by the AMWU. The company offered to discuss amendments to the Protocols however the AMWU declined to do so.

[308] In his oral evidence Mr Jarman agreed that the AMWU had never indicated that it would not continue to use the bargaining issues table even though it had provided a draft agreement.

[309] Mr Jarman testified that, at the time of the MSD, Cochlear was not opposed to bargaining however it campaigned for a no vote because it wanted to test the true intentions of the employees. He disagreed that the company does not wish to deal with the AMWU and also disagreed that Cochlear does not want to enter into an enterprise agreement.

[310] Mr Jarman testified that Cochlear took into account the views of the EBRs. He understood that both of them provided their own instruments of appointment to the company. He was not aware whether any others were provided. Mr Jarman testified that he understood a number of employees had expressed interest in becoming bargaining representatives. He denied that Cochlear had attempted to control the number of representatives. Mr Jarman testified that the company had a preference for a smaller number of representatives but understood that it had no right to reject any nominations.

[311] Mr Jarman agreed that, in mid February 2011, he became aware that the EBRs had not received the union’s proposals of 22 December 2010. He testified that Cochlear did not provide the EBRs with a copy as it was not the company’s obligation to do so. Further, there was insufficient time in which the EBRs could have reviewed all of the material before the next meeting. Mr Jarman denied that he had suggested a strategy to request more time for the EBRs to review the documents although he accepted that it appeared somebody had suggested this to them. He denied that Cochlear was not being constructive in the bargaining process.

[312] Mr Jarman agreed that, as of February 2011, the company had not decided whether to have a stand-alone or an award incorporated agreement. He agreed that this was a fundamental issue.

[313] Mr Jarman gave evidence about the Fair Work Principles and the User Guide. Cochlear had concerns about entering into an agreement that required compulsory arbitration and considered that this issue was a roadblock to agreement. Mr Jarman testified that, in the 30 April 2012 proposal, Cochlear had advanced a new position on this issue. If the parties can agree upon the clause Cochlear wants the parties to approach DEEWR for its advice. It should be noted that it is this clause which is referred to in Order 5 of the union’s proposed orders.

[314] Mr Jarman testified that the proposed clause allowed for non-compulsory arbitration. He has doubts that the AMWU will agree to the clause. Mr Jarman testified that it would carry more weight with DEEWR if the parties jointly supported it. Mr Jarman disagreed that it would be more efficient to request DEEWR’s advice before the parties negotiated about the clause. He testified that, because the proposed clause is part of a whole package, its rejection by DEEWR would require Cochlear to reconsider its position on a number of matters.

[315] Mr Jarman agreed that Cochlear knew the substance of the position of the EBRs from 23 March 2011 but the AMWU was not advised until 28 June 2011. He testified that the reason was because the union cancelled the bargaining meeting for 24 March which would have been when they were to be advised. He agreed that there were two other bargaining meetings between then and 28 June.

[316] Mr Jarman testified that he understood that the EBRs did not want an enterprise agreement but nevertheless he believed that the EBRs advanced some positive claims in the bargaining issues table in July 2011. These included a dispute settlement provision, parental leave and a meal allowance as well as reserving their rights on the workplace representatives and flexibility proposals of the AMWU. Mr Jarman testified that he understood the EBRs wanted to ensure that, if there is to be an agreement, it protects job security. Mr Jarman testified that he did not consider that it was unusual that the EBRs didn’t seek a wage increase and did not believe that Cochlear should have taken any steps to ascertain that the EBRs adequately reflected the views of those they represented. Mr Jarman testified that employees were paid well above the Award, up to 60-70% above in some cases.

[317] Mr Jarman agreed that the Protocols did not require that the Minutes of bargaining meetings be signed but that Cochlear had insisted on it. He testified that he informed other members of the management committee of the draft minutes but didn’t consult them about the contents. Mr Jarman disagreed that he was manipulating the Minutes to favour Cochlear’s position. The Minutes were written to ensure that the AMWU’s stance was recorded. Mr Jarman denied that he had put a gloss on what the EBRs had said at the bargaining meetings to reinforce Cochlear’s position.

[318] Mr Jarman denied that Cochlear changed its view about the utility of having bargaining protocols as a means of delaying the substantive negotiations. He testified that three months of the delay in reaching agreement on the protocols was due to the union’s allegations that Cochlear was acting in bad faith. Mr Jarman testified that both parties were anxious to reach agreement on protocols.

[319] Mr Jarman testified that the relationship between the parties had become adversarial in early 2010 and Cochlear believed that the union would not honour the Protocols unless it committed to them. Cochlear’s view was that the Protocols were essential to proper and efficient negotiations. Mr Jarman disagreed that the Protocols were highly prescriptive, contained unnecessary clauses or were liable to cause delays.

[320] Mr Jarman testified that Cochlear’s approach to the substantive negotiations had been to start with a clean slate and to reconsider all of the provisions in the 2005 Agreement, the Award and the individual contracts. The company also wished to have a safety net agreement with some matters still covered by the contracts.

[321] Mr Jarman testified that it was not until June 2011 that the AMWU provided detailed information about the sources of its claims. His evidence is that, prior to that time, the union had only given a limited indication of its claim. Mr Jarman testified that several of the clauses proposed by the AMWU could be possible impediments to flexibility. Examples include the clauses relating to consultation, remuneration, bonuses, hours of work, shift work, make up time and annual leave incentive.

[322] Mr Jarman disagreed that, after the AMWU had provided its documents in December 2010, it was entirely dependent upon Cochlear to respond. He testified that the union had other avenues available to it including, industrial action, a media campaign, a political campaign and bringing matters to FWA. Mr Jarman agreed that the AMWU complained about a lack of response and took other actions but noted that it also continued to attend the bargaining meetings and answered Cochlear’s questions.

[323] Mr Jarman testified that it was absolutely essential to Cochlear that the AMWU respond to all of the questions about its December 2010 proposals. He noted that in some instances a “don’t know” may have been all that the union could provide. Mr Jarman testified that he thought the union’s claim was complicated. Cochlear had concerns about the union’s proposal to move some of the provisions in the individual contracts into an agreement. Any disputes about those provisions could be brought to FWA and any change would need to involve the AMWU. This would have the potential to adversely impact on Cochlear’s flexibility.

[324] Mr Jarman testified that the reason Cochlear verbally outlined its response to the union proposal in the bargaining meetings before providing the written response was to explain its view. He denied that it was just a further means of delay. He disagreed that the company’s response could have been provided shortly after receipt of the union’s proposal.

[325] Mr Jarman agreed that the company’s response did not include any wages or allowances. He testified that there had been no opportunity to depart from that position as bargaining had stopped. Mr Jarman agreed that it was unlikely that Cochlear’s August 2011 proposal could give rise to an agreement that would pass the BOOT and also agreed that, because there was no entitlement to wages and allowances, it would actually reduce the safety net. He noted that it was Cochlear’s opening position and was a reflection of the company’s intention to bargain hard. Mr Jarman testified that there were differing views within Cochlear as to whether wages would or would not be included. He later testified that Cochlear had always intended that there would be a wages clause in any agreement.

[326] Mr Jarman agreed that Cochlear provided its proposals for the mandatory agreement terms 16 months after it had received the AMWU’s terms. He also agreed that Cochlear’s proposal of 30 April 2012 could have been put earlier however noted that would not have accorded with the company’s bargaining strategy. Mr Jarman also noted that Cochlear was not going to negotiate against itself and was following usual negotiating practice of offer, counter offer etc.

[327] Mr Jarman agreed that the 30 April 2012 proposal was below the employees’ existing terms and conditions. He testified that it was above the legal safety net. The company is confident its proposal doesn’t unduly restrict its flexibility, productivity and competitiveness.

[328] Mr Jarman testified that Cochlear was paying for the EBR’s legal representation because it wanted to ensure they were afforded all the rights and benefits of being bargaining representatives. He noted that the EBRs had special requirements in the context of the volume of material and the fact that English is their second language. They were also given access to independent legal advice before signing the Protocols.

[329] Mr Jarman testified that he believed that the AMWU was playing games to see if an agreement could be reached but, if not, was prepared to make a political example of the company. He testified that it appeared the AMWU had been intransigent on many issues and had not put adequate resources into the bargaining.

[330] Mr Howitt provided two witness statements. The first was dated 23 February 2012 and became Exhibit Cochlear 32. This was in response to the first statements of Mr Ayres, Exhibit AMWU 2 and Ms Fortescue, Exhibit AMWU 7 and the statement of Mr Mason, Exhibit AMWU 10. Mr Howitt’s second statement was dated 17 April 2012 and was marked Exhibit Cochlear 33. Mr Howitt also gave oral evidence which is at PN8720-9917 of Transcript.

[331] In his first statement Mr Howitt notes that, since 2001, he has been involved in discussions about bargaining for agreements to cover Cochlear’s production employees. He has also been involved in developing the company’s bargaining strategies. Mr Howitt notes that he has not participated in the present set of bargaining meetings.

[332] Mr Howitt’s evidence is that the AMWU was not involved in any substantive way with the 2001 and 2003 agreements and became involved in the 2005 Agreement only at a late stage in the negotiations. Mr Howitt’s evidence is that Cochlear applied to have the 2005 Agreement terminated because it was no longer relevant. Employees’ wages and productivity have improved significantly since the introduction of the common law contracts in 2007.

[333] Mr Howitt’s evidence is that he had doubts about whether there was majority support for bargaining at the time the Act commenced and believed that the matter should be tested. Mr Howitt refers to the paid meetings on 19 August 2009 in the lead up to the MSD ballot. He notes that the timing of the meetings was scheduled to cause minimal disruption to production. Mr Howitt estimates that the cost at the time of the 30 minute meetings was $30,000. He estimates that, with present numbers, the cost for a 30 minute meeting now would be $39,000. These estimates don’t include any allowance for loss of sales.

[334] Mr Howitt notes that the paid meetings were held in the main lunchroom. He further notes that the union had not been given access to that area since an incident in May 2007 involving inappropriate conduct by AMWU officials.

[335] Mr Howitt refers to his correspondence of 17 August 2009 in which he informed employees that their terms and conditions would be guaranteed until 1 July 2012. His evidence is that he issued the letters because he had been informed that the AMWU had led employees to believe that, if they voted against bargaining, then Cochlear would reduce their wages and conditions.

[336] Mr Howitt’s evidence is that the terms of the common law contracts are very different to the 2005 Agreement. These differences include higher wages, a more appropriate classification matrix, additional leave and certainty about hours of work.

[337] Mr Howitt’s evidence is that he initially proposed a meeting without delegates as he thought this would be to discuss procedural issues only. He intended that substantive bargaining should involve all bargaining representatives. Mr Howitt considered that some employees might want to represent themselves in bargaining as a number had expressed concerns at being represented by the AMWU.

[338] Mr Howitt provides evidence of the AMWU setting unreasonable timeframes for responses to correspondence. Mr Howitt’s evidence is that the union’s threat to take matters to FWA caused him to form the view that Cochlear should seek advice and understand the implications of any proposed response.

[339] Mr Howitt refers to the union’s request for the release of eight delegates for a meeting in September 2009. He gives evidence of the extent of the disruption that would cause especially in the context of the new product line which was due to be launched at that time. Mr Howitt also refers to the AMWU’s request for nine, then seven, delegates for its bargaining committee. His evidence is that it appeared that the union had little understanding of the operational requirements of Cochlear’s business.

[340] Mr Howitt notes that the ultimate number of three delegates for the union’s bargaining team was able to be accommodated because the two morning/day shift employees had already finished work before the commencement of the bargaining meetings.

[341] Mr Howitt provides evidence about the role of the management committee in reviewing the progress of bargaining and developing Cochlear’s strategy. His evidence in this regard is similar to that of Mr Jarman.

[342] Mr Howitt’s evidence is that, in negotiating the Protocols, his objectives were to facilitate effective and efficient bargaining and result in a process which would cause minimal disruption to the business and which would recognise the importance of Cochlear’s international competitiveness. His evidence is that the union’s approach to bargaining to that point had been extremely litigious and he wanted to introduce order into the process.

[343] Mr Howitt’s evidence is that the management committee considered each of the union’s requests for paid meetings. In doing so they considered operational impacts, the progress of negotiations, the possible content of any such meeting and whether the union had availed itself of other methods of consultation. Those methods included ROE visits, meetings on the nature strip in front of the premises, the distribution of flyers, home visits and meetings at the union’s office.

[344] Mr Howitt’s evidence is that, in view of all of these other methods of communication available to it, he did not consider that the AMWU’s requests for paid meetings were justified in view of the impact on production and cost to the business. Further, the union had stated that it had consulted employees to formulate its claims. Mr Howitt is not aware of any paid meetings being granted in relation to the negotiation of the 2001 and 2005 agreements. Mr Howitt notes that the request for a paid meeting in December 2010 was at a particularly difficult operational time.

[345] Mr Howitt gives evidence about the main lunchroom and the Mural Room. He refers to the Code of Practice and an incident of inappropriate conduct by union organisers in May 2007 in which they had not acted in a respectful or appropriate manner and had disrupted employees’ use of the lunchroom. Mr Howitt notes that the AMWU did not dispute the allegations nor did it respond to his correspondence stopping further access to the lunchroom.

[346] Mr Howitt’s evidence is that, since that time, the union has been allocated another room for its ROE visits, most often the Mural Room. His evidence is that the Mural Room is the midpoint between the two production areas being about 150 metres from each. He notes that one of those areas is presently not in use. Mr Howitt estimates that the Mural Room is 3 metres by 5 metres and holds at least 10 people. There are no managers’ offices nearby. Mr Howitt’s evidence is that he has never seen people queuing or spilling outside the room during the ROE visits. He rejects Mr Ayres’ evidence that the Mural Room did not permit the union to adequately consult with employees. Mr Howitt’s evidence is that the lunch area next to the Mural Room is quieter than the main lunchroom and consequently food would take less time to prepare there.

[347] Mr Howitt makes reference to the annual wage increases. He does not recall any objection from the union to the increases in 2007-2010 and specifically refers to correspondence from the union in 2009 urging an increase. The 2011 increase was consistent with Cochlear’s stated position of retaining the existing process for pay increases.

[348] Mr Howitt disagrees with Mr Ayres’ assertion that the EBRs didn’t advance any claims which differed from Cochlear’s position. He denies any assertion that Cochlear has influenced or controlled the views of the EBRs. Mr Howitt’s evidence is that he is not aware of either EBR using paid time to discuss bargaining or gather support.

[349] Mr Howitt gives evidence about the importance of the company’s international competitiveness and factors which have given rise to its leading position. He also provides evidence of pressures on the business. Mr Howitt’s evidence is that these factors have been communicated to employees at the monthly meetings. Mr Howitt’s evidence is that he does not believe that the AMWU has paid sufficient regard to these issues in formulating its bargaining position. The union’s claims would add to Cochlear’s costs without any offsetting productivity improvements.

[350] Mr Howitt’s evidence is that there is nothing illegitimate in asking the AMWU to justify its claims against the goals of international competitiveness, improved productivity and job security which are set out in the Protocols. It is important that the union understand and support the need for ongoing improvements and flexibility.

[351] It is the evidence of Mr Howitt that he has been consulted on each formal request for paid meetings. He has considered those requests. The basis for refusal thus far has been the cost as well as the factors set out earlier in his evidence especially at paragraph 343 above.

[352] Mr Howitt rejects Mr Ayres’ assertion that Cochlear has adopted a narrow approach to ROE. He is not aware of any complaints about the Mural Room.

[353] Mr Howitt gives evidence about the regular communications meetings with employees. In two of these in 2011 he provided a brief bargaining update. His evidence is that each took less than three minutes in a half hour meeting and was the topic about which there was the least interest from employees. Mr Howitt notes that the AMWU flyers provide more detail than he has given in his updates. Mr Howitt also gives evidence about the ECC which was created under the 2005 Agreement. It contains both employee and management representatives and meets monthly. It discusses a range of issues. The ECC is told when the bargaining meetings occur and is directed to the Minutes.

[354] Mr Howitt rejects Ms Fortescue’s characterisation of Cochlear’s conduct between 2007 and 2009. His evidence is that the company had never contemplated putting employees on base award conditions. Further, his evidence is that he is not aware of employees being reprimanded or disciplined for discussing bargaining or union matters during work time. Mr Howitt’s evidence is that the only restrictions on discussions is on issues that are offensive to others or if people are distracting others from their work which is particularly skilled and concentrated.

[355] Mr Howitt rejects Ms Fortescue’s allegation that Cochlear has obstructed ROE for the afternoon shifts. His evidence is that, between 2009 and 2012, the AMWU has made 14 ROE visits, eleven times for discussions with the afternoon shift. He provides details of accommodations made to facilitate entry for those visits. Mr Howitt’s evidence is that the company wished to have a manager on site for that purpose.

[356] Mr Howitt refers to a decision to refuse the release of delegates for FWA proceedings in December 2011. The reasons for the refusal were the short notice and the nature of the proceedings and the operational issues at the time.

[357] Mr Howitt notes that Mr Mason has the opportunity before and after shifts and during breaks to speak to his colleagues about bargaining. Mr Howitt is unaware of complaints about the absence of any notification of union visits and notes that there is a union noticeboard in the main lunchroom. The AMWU has also used flyers for this purpose.

[358] Mr Howitt refers to Mr Mason’s evidence about being reprimanded after making comments at an ECC meeting and notes that he is not aware of this. Mr Howitt denies making a statement at a monthly meeting in November 2011 which was attributed to him by Mr Mason. Mr Howitt’s evidence is that he wanted employees to know about the FWA proceedings from him rather than from the media.

[359] In his second statement Mr Howitt provides additional information about Cochlear and the factors which have led to its pre-eminent position in its field. His evidence is that it has a low turnover of staff and at present, all of its employees are permanent.

[360] Mr Howitt provides additional evidence about shifts and work areas and notes that some areas have staggered rest and meal breaks to enable production to continue. The specific details of those breaks are set out at paragraph 16 of the statement. Mr Howitt also refers to the “Mulberry B” production area which has not operated since September 2011 when Cochlear recalled one of its products. He notes that the recall required a significant rearrangement of production. Mr Howitt’s evidence is that employees showed great commitment and flexibility in accommodating the changes, including in some cases, shift changes.

[361] Mr Howitt also provides additional evidence about the union’s access to employees. Available methods include phone and email, meetings on the nature strip and use of the noticeboard. Mr Howitt’s evidence is that he is not aware of material being removed from this board. Mr Howitt also adds to his evidence about the Mural Room and the lunch facilities nearby. He notes that the union has not requested extra seating for the Mural Room.

[362] In his oral evidence Mr Howitt testified that it was not misleading for Cochlear to suggest to employees that voting yes in the MSD ballot could put current terms and conditions at risk. He testified that involving the union in the business and negotiating a new agreement could create uncertainty.

[363] Mr Howitt agreed that the company was recommending a no vote just as the AMWU was campaigning for a yes vote. Mr Howitt denied that Cochlear’s present view was that it did not want an agreement with the AMWU. He testified that once the MSD was made Cochlear has been endeavouring to reach an agreement. He testified that it is not Cochlear’s intention to negotiate without wanting to reach agreement.

[364] Mr Howitt testified that guaranteeing the terms and conditions of the common law contracts for three years until 1 July 2012 had not restricted the company’s ability to improve its productivity. However there were concerns about the union’s proposal to put the substance of those terms into an agreement. These concerns include the nature of the instrument, the totality of the clauses and the fact that potentially the agreement could continue for perpetuity. Mr Howitt testified that Cochlear needs the flexibility to adapt over the long run to changes in its business needs.

[365] Mr Howitt agreed that Cochlear had decided it wanted a safety net agreement sometime before the 2nd bargaining meeting. He also agreed that there was a fundamental difference of approach between that and what the AMWU had proposed in December 2010. Mr Howitt testified that the agreed process was important as was the need for Cochlear to properly understand the union’s position. He also testified that it was a standard negotiation process to reach agreement on issues before attempting to draft clauses.

[366] Mr Howitt disagreed that the management committee could have conducted all of its meetings by email or phone although there was some use of those facilities. He emphasised that face to face meetings were very important and often more efficient.

[367] Mr Howitt disagreed that the Protocols had failed to deliver effective and efficient bargaining. He agreed that the resultant process had taken some time and suggested that it was reasonable that it would be so. Mr Howitt disagreed that Cochlear had taken an unreasonable time to respond to the union’s proposals. He testified that the company needed to properly understand the AMWU’s position.

[368] Mr Howitt testified that the EBRs volunteered the numbers of employees they represented. He was not aware of any steps Cochlear took to verify those numbers. He testified that the exact number would not have changed the roles or rights of the EBRs. Mr Howitt denied that Cochlear had encouraged employees to sign up with the EBRs. He testified that he wasn’t aware of any positive claims put forward by the EBRs at this time however they may do so in the future.

[369] Mr Howitt agreed that the company’s proposal of 30 August 2011 did not contain any wages or allowances. He testified that it had always been his assumption that wages would form part of any agreement and that the management committee meetings had been clear on this point. He also testified that his intention was that any agreement would be above the NES and the Award.

[370] Mr Howitt testified that Cochlear’s position was that any agreement needed to maintain or improve the productivity, flexibility and competitiveness of the company. Many of the AMWU’s proposals would take it backwards. Examples of this include the proposed consultation, flexibility and dispute resolution clauses.

[371] Mr Howitt testified that Cochlear’s 30 April 2012 proposal contained a consultation clause which is more flexible than that which is in the 2005 Agreement. The proposed clause has a narrower list of matters about which consultation is required and it contains time limits. It does not require consultation with the AMWU.

[372] Mr Howitt testified that he expected that the AMWU would need time to consider and respond to Cochlear’s proposal of 30 April 2012. At the time of giving his evidence, employees had not been briefed about this proposal. Mr Howitt testified that the manner in which the union consults its members about Cochlear’s proposal is a matter for it.

[373] Mr Howitt testified that the largest number of employees on a break at any particular time was approximately 30. He agreed that employees probably had about 20 minutes of their lunch breaks which was not taken up with food preparation or other tasks. He disagreed that it would be difficult for the AMWU to meet with any particular group of employees for longer than 10 minutes in their lunch breaks. Mr Howitt testified that the Mural Room had always accommodated the numbers who have attended union meetings in the past but agreed that 20 would be a tight fit.

[374] Mr Howitt testified that he had never asked for changes to be made to the Minutes of a bargaining meeting. He had once commented about an issue he didn’t understand. Mr Howitt disagreed that the Minutes were designed to primarily present Cochlear’s perspective.

[375] Mr Howitt testified that the regular communications meeting are held on the basis of three half-hour sessions each time. The cost to the business is $39,000.

[376] Mr Howitt testified that he does not understand why the AMWU does not want to follow the Protocols other than having concerns about delays in the bargaining process. He testified that the AMWU has also contributed to delays. Mr Howitt noted that the union could have sought to change the Protocols.

[377] Mr Howitt testified that Cochlear might agree to an AMWU request for a paid meeting if the parties had reached agreement. Another instance might be if agreement had almost been reached but there was something on which the employees needed to cast a vote or something of substance on which they needed to make a decision.

[378] Mr Howitt testified that he still opposed providing the AMWU with access to the main lunchroom. A number of employees who use that room don’t want to be disturbed during lunch and don’t want to have anything to do with the union. The main lunchroom is also used by non-production employees.

SUBMISSIONS ON BEHALF OF THE AMWU

[379] The AMWU provided the following written outlines of submissions:

[380] Ms Howell also made oral submissions on 19 March, 31 May and 9 July 2012.

[381] The AMWU submits that the question of whether or not a party has met or failed to meet the good faith bargaining requirements of the Act is a matter which is to be determined in light of all the relevant circumstances: CFMEU v Tahmoor Coal Pty Ltd [2010] FWAFB 3510 @ para 24 (Tahmoor). In deciding the issue FWA is entitled to apply its expertise as a specialist tribunal.

[382] In relation to its own application, the AMWU submits that Cochlear has not complied with the good faith bargaining requirements of sections 228(1) of the Act, in particular, the requirements of paragraphs (a), (c), (d) and (e). The union submits that the conduct giving rise to the contraventions falls into four categories: delays in responding to the union’s proposals especially the delay in providing any proper response between December 2010 and April 2012; conduct associated with the Protocols; the imposition of additional procedural requirements not contained in the Protocols; and, improper conduct in dealing with the EBRs. It submits that these contraventions overlap and cumulatively amount to unfair and capricious conduct which undermines collective bargaining.

[383] The AMWU submits that it has met the procedural requirements of the Act in relation to the provision of notice to Cochlear of its concerns. It notes that, although Order 5 is new, the company has had ample opportunity to have considered it during these proceedings. Furthermore, Cochlear has had more than sufficient notice of and opportunity to respond to each and every contravention alleged against it. The union submits that, to the extent that there has been any non-compliance with the notice requirements concerning any of the bargaining representatives including the EBRs, section 229(5) should permit the matters to be considered.

[384] It is submitted that the overarching issue is the slowness of the bargaining process. That slowness occurred despite the union’s repeated expressions of concern. When Cochlear did provide a written response in August 2011 it was not a genuine response. In this regard the union relies upon the Full Bench decision in Endeavour Coal Pty Ltd v Association of Professional Engineers, Scientists and Managers, Australia [2012] FWAFB 1891 @ paras 26-31 (Endeavour Coal).

[385] The AMWU submits that it has always been Cochlear’s preference not to bargain or reach an agreement at all. This was evident in its actions both prior to and following the MSD. Cochlear’s true intent is reflected in various documents including Mr Jarman’s reference to the Fair Work Principles being a “roadblock” in Exhibit AMWU 15 as well as the contents of Exhibit AMWU 34. It is submitted that Cochlear’s priority has been strict adherence to formal procedures rather than to engage in any real attempt to reach agreement. To that end the company has taken every opportunity to delay the bargaining process.

[386] The union submits that the company has not met the requirements of section 228(1)(c)(d) and (e) in that it did not respond in a timely manner. The AMWU’s position had been put during 2010. The claim was not complicated. The evidence of Mr Hargraves and Mr Howitt is that, by early 2011, Cochlear could have provided a substantive response yet the company’s response was not made until August of that year. In these proceedings, Cochlear unreasonably relies on the process both in the Protocols and otherwise as the reason for the delay.

[387] The AMWU also submits that the fact that Cochlear had a fundamentally different and narrower approach to the content of any agreement reinforces the futility of much of the delay in providing the August 2011 response.

[388] The union submits that Cochlear’s August 2011 response was not a genuine response and indeed did not amount to a response at all for the purposes of section 228(1)(c). It demonstrated an absence of any genuine consideration of the union’s proposal and reflected the conduct of a party going through the motions of bargaining without having any intention to reach agreement: surface bargaining.

[389] The AMWU submits that, although Cochlear’s management committee had in excess of 50 meetings before putting its August 2011 response, what was provided was neither adequate, nor in good faith for the purposes of section 228(1)(c) and (d). The company’s response lacked any position on the scope of the proposed agreement, contained no wage rates, excluded large parts of the safety net without providing any compensatory improvements and indicated that the three mandatory terms would be dealt with sometime in the future. Cochlear’s proposal would not have satisfied the BOOT.

[390] It is noted that the evidence of the company’s witnesses differs on the question of whether wages were to be included in any agreement. The union submits that the evidence of Mr Jarman and Mr Howitt that wages were to be included is not plausible. First, it is not possible that Mr Hargraves could have misunderstood Cochlear’s position on such a fundamental point. Secondly, if wages had been inadvertently omitted from the August 2011 response, it is inconceivable that such an error had not been corrected in the period following or indeed in the company’s evidence in chief.

[391] The union submits that there are serious doubts as to whether the company’s 30 April 2012 proposal would satisfy the BOOT. It excludes the majority of Award provisions including allowances and wage rates are only 10% above the Award. The dispute settlement provisions are problematic. Cochlear has always been aware that any agreement must comply with the Fair Work Principles.

[392] An important requirement of those Principles is that any dispute settlement procedure provides for arbitration. The union submits that Cochlear’s proposal of consent arbitration with the added constraint that the outcome of such arbitration cannot be detrimental when considered against various criteria does not meet the Principles. Cochlear’s refusal to approach DEEWR about its proposed clause unless the AMWU first agrees to the clause is not reasonable and will further delay the bargaining process. The company’s position is capricious and unfair, undermines collective bargaining and is in contravention of section 228(1)(e). In its final reply submissions the AMWU rejects the company’s suggestion that to approach DEEWR now without an agreed clause will contribute to further delay.

[393] The union submits there are several contraventions of section 228(1) which flow from the company’s conduct with respect to the Protocols. These also provide justification for refusing the order sought by Mr Hargraves.

[394] The Act does not require the AMWU to enter into any protocols or to be bound by them for an indefinite period. FWA should not impose a set of procedures which are far more stringent than those in the legislation. Cochlear’s obligations under the Act to attend and participate in meetings at reasonable times remain regardless of the AMWU’s attitude towards the Protocols. Cochlear has refused to meet since November 2011 unless it is under the terms of the Protocols. This gives rise to a contravention of section 228(1)(a) and (e).

[395] The union submits that additional contraventions of those provisions also flow from Cochlear’s delay in the negotiation of the Protocols and its refusal to bargain before the Protocols were finalised. Other offending conduct includes the manner in which the company used the Protocols to slow down the bargaining and as a tactical and adversarial weapon during the process.

[396] It is submitted that Cochlear’s refusal to commence bargaining until the Protocols had been agreed is in itself a separate contravention. There was no logical reason for the company’s failure to meet to have preliminary discussions about the substantive issues. The use of the union’s 4 January 2010 email as a further delaying tactic and the late introduction of new demands are further examples of the company’s inappropriate conduct.

[397] The AMWU submits that Cochlear has relied on the Protocols to delay bargaining on a number of occasions. Specific examples include the company’s refusal to meet more frequently than 14 days apart, for longer than the 2 hour time limit, and when Mr Jarman was unavailable, as well as its additional requirement that the AMWU sign each set of Minutes. The union submits that these matters show that Cochlear has used the Protocols as a bargaining impediment.

[398] The AMWU submits that Cochlear has used the Protocols to make various allegations that the union has breached the good faith bargaining requirements of the Act. If the Protocols are re-imposed as sought in Mr Hargraves’ application, Cochlear will be given the opportunity to further exploit them in this fashion. The union also submits that the company’s view of the Protocols would require the AMWU to make concessions contrary to the provisions of section 228(2)(a). Cochlear’s adversarial approach means that the Protocols create uncertainty and ambiguity about the parties’ bargaining obligations.

[399] The union rejects the suggestion of renegotiation of the Protocols. Given the history of the earlier negotiations and the company’s continued refusal to bargain in the absence of agreed protocols any such renegotiation could only provide the opportunity for further delay.

[400] The union submits that Cochlear’s unilateral requirements that the AMWU sign the Minutes, that the company ask extensive questions over a period of months and that the EBRs provide a written position before the company would respond to the union claim contributed to further delay. Cochlear’s insistence that the Minutes be signed caused great friction and wasted much time. The process of questioning the union’s position at great length was not agreed, however, the AMWU had no option but to go along with it if it wished bargaining to continue. The union identifies a number of occasions on which it pressed Cochlear to provide its bargaining position.

[401] The AMWU submits that the interaction between the company and the EBRs amounts to unfair and capricious conduct which contravenes section 228(1)(e). This conduct has several aspects. The company sought to control the identity, numbers and work characteristics of any non-union bargaining representatives. The union relies in particular on the evidence in Exhibits AMWU 14, 27 and 28 as well as Attachments TA 35 and TA 36 to Exhibit AMWU 2. It notes that one of the EBRs is a Team Leader and was described by Cochlear as an advocate for the company.

[402] It is submitted that Cochlear has manipulated the presence of the EBRs in the bargaining process for its own ends so that the only non-union representatives in the process are those who oppose the union’s claims and support the company’s position. This conduct has undermined collective bargaining.

[403] The union notes that the evidence is that, until December 2011, the EBRs represented at most 25 employees including themselves. This is despite their claims in November 2010 and July 2011 respectively, that they represented “all the non-union employees in Mulberry B” and “100 people”. There is no evidence that Cochlear took any steps to verify the numbers the EBRs alleged that they represented or required compliance with section 178(2). The company did not inquire as to whether the EBRs were properly reflecting the bargaining position of those they represented.

[404] The AMWU submits that Cochlear’s treatment of the EBRs is in stark contrast to its approach to the union. The company firstly disputed that a majority of employees wanted to bargain and then, following the MSD, continued to question the legitimacy of the union’s claims. This disparity in treatment is unfair and undermines freedom of association contrary to section 228(1)(e).

[405] It is submitted that Cochlear promoted and supported the EBRs, in particular, by providing nomination forms pre-printed with their names. Cochlear did not provide any neutral forms which would have permitted the signatory to nominate whoever they wished. This preference for one bargaining representative over another and the provision of assistance to one over another amounts to unfair conduct contrary to section 228(1)(e). This unfairness is exacerbated by the fact that the preferred bargaining representatives are those who reflect the company’s view, who have not advanced any positive claim and who have a position of not wanting any enterprise agreement.

[406] The AMWU submits that Cochlear adopted a strategy to use the EBRs to delay negotiations. Its insistence that the EBRs provide their position before Cochlear would respond was unfair conduct which delayed that response and undermined collective bargaining contrary to section 228(1)(e). Cochlear’s claim that it was not aware of the EBRs’ position until three months after it knew of their position is a further instance of conduct contrary to section 228(1)(e). The EBRs colluded in Cochlear’s strategy by not correcting the company’s claim that it didn’t know their position. The union submits that the company’s refusal to respond until after the EBRs also amounted to a failure to respond to the AMWU’s claim in a timely manner, contrary to section 228(1)(c).

[407] The AMWU submits that the evidence discloses that Cochlear assisted the EBRs to complete their portion of the bargaining issues table given to the union in July 2011. The evidence also reveals that Mr Jarman adjusted the Minutes of the 8th bargaining meeting to reformulate what the EBRs had said about their position. This manipulation of the EBRs position was unfair conduct which undermined collective bargaining, contrary to section 228(1)(e). The union submits that Exhibit AMWU 34 also points to the compromised relationship between the company and the EBRs.

[408] It is submitted that Cochlear has continued to provide favourable treatment to the EBRs by paying for their legal representation in these proceedings.

[409] The union submits that the full extent of the relationship between Cochlear and the EBRs has not been revealed because of the company’s failure to call the EBRs and/or the human resources generalists and production manager within Cochlear who dealt directly with the EBRs. This failure gives rise to a Jones v Dunkel (1959) 101 CLR 298 inference. In its final reply submissions the AMWU argues that, because of the particular relationship between Cochlear and the EBRs, it would have been natural for the company to have called them to give evidence. They are in Cochlear’s camp. The AMWU rejects Cochlear’s submission about one of the human resources generalists, Ms Fitzhenry, who is no longer employed by the company. It submits that the decisions relied on by Cochlear do not support its proposition and, indeed, one stands for the opposite: Shum Yip Properties Development v Chatswood (2002) 40 ASCR 619 (Shum Yip) and Claremont Petroleum v Cummings (1992) 110 ALR 239 (Claremont Petroleum).

[410] The AMWU submits that the close and cooperative relationship between Cochlear and the EBRs in itself amounts to capricious and unfair conduct which undermined collective bargaining and freedom of association contrary to section 228(1)(e).

[411] It is submitted that the cumulation of these identified contraventions meets the requirements of section 230(2) and (3) and it is reasonable to make the orders sought by the union.

[412] The union submits that the bargaining process has stopped because Cochlear has refused to meet other than under the terms of the Protocols. The imposition of these Protocols is neither necessary nor desirable. Section 228(1)(a) is unconditional in requiring parties to attend and participate in meetings at reasonable times. Cochlear’s refusal to do so needs to be remedied by way of Orders 1 and 2.

[413] Orders 3 and 4 are directed towards assisting the AMWU to properly inform and consult with its members about bargaining. The union submits that Cochlear’s pattern of communications with its employees is relevant to this issue.

[414] The AMWU notes that the evidence is that Cochlear has provided little direct information to employees about the bargaining process especially in relation to its own bargaining position. The focus of the information has been on process. The union submits that the forms of communication which did occur were essentially just a means of advancing Cochlear’s position of opposition to an agreement.

[415] The offending communications include the signed Minutes of the bargaining meetings, reports to the ECC and Mr Howitt’s oral reports on bargaining given during production meetings in July and November 2011. The evidence is that the Minutes were written from Cochlear’s perspective and, on some occasions, were circulated to managers who are not bargaining representatives for input and then altered. The union submits that the tenor of the Minutes compared to the notes of the meetings was to emphasise the company’s role without providing details of its bargaining stance. Specific examples are identified in a Schedule to the written outline of 28 May 2012.

[416] The union submits that Cochlear’s explanation of why the Minutes of the 9th bargaining meeting were not circulated was not plausible. The result of this failure to provide the Minutes was that employees were not informed of the company’s August 2011 proposal which was significantly beneath the safety net. It is noted that the union was not able to disclose the company’s proposal to employees because it is confidential to the bargaining representatives.

[417] The AMWU submits that the evidence shows that the reports to the ECC were minimal, focussed on process rather than substance and cast the union in a negative light. The cumulative report in Exhibit AMWU 41 demonstrates Cochlear’s selective communications. It is submitted that Mr Howitt’s reports in the production meetings were limited and biased in Cochlear’s favour.

[418] The AMWU concedes that it is understandable that the company would seek to put its version of events to employees. It submits however that Cochlear’s greater opportunities in this regard together with its selective and biased use of those opportunities, means that the AMWU needs to engage with employees to correct misinformation, explain the company’s position and develop its own response.

[419] The need for paid meetings as sought in Order 3 arises from several factors: the inadequacy of the union’s available means of communication; the need to explain the reasons for delay thus far; the limited, selective and biased communication by the company during paid time; the lack of information to employees about the EBRs; Cochlear’s requirement that the AMWU justify that its claims have employee support; the need to explain Cochlear’s April 2012 position; and, the need to develop a response.

[420] The AMWU submits that the language barriers of dealing with such a multi-cultural workforce compounds its communication difficulties. Telephone and email exchanges and meetings on the nature strip or in the union office are inadequate for proper consultation about bargaining. This is especially so when contrasted with the regular meetings of Cochlear’s management committee.

[421] The union submits that the evidence establishes that the Mural Room is too small and remote for discussion purposes especially in light of the short lunch break and desire by many employees to share their food. The overlapping breaks, language issues and complexities of bargaining mean that the minimal time available for discussion is not adequate. The issue is even more important because Cochlear has repeatedly challenged the union as to whether it is properly representing the views of its members.

[422] It is submitted that an additional reason for paid meetings now is the need for the union to consult about complex issues arising from Cochlear’s April 2012 proposal and to formulate an appropriate and considered response. None of this can be adequately done by way of the methods of communication suggested by the company.

[423] The union notes that Cochlear had resisted all requests for paid meetings. It also notes that the company was not prepared to provide material about the costs of such meetings which could be properly tested. The AMWU suggests that any paid meetings could be held immediately before or after the monthly production meetings to minimise cost and disruption. The union submits that now there is something of substance to be put to members.

[424] The union submits that Order 4 should be granted to address the communications difficulties. The main lunchroom would make it much easier for the union to consult informally about bargaining. Events have progressed from the alleged incident in 2007. The possibility that some employees may wish to have their lunch without the AMWU being present could be addressed by those employees utilising the other lunch area when the union was on site. The AMWU suggests that access to the main lunchroom could be granted on a trial basis. The union has offered to provide an undertaking as to its conduct during any ROE access visits. A draft of that undertaking is set out at Schedule E to the 28 May 2012 outline.

[425] In its final reply submissions the AMWU takes issue with Cochlear’s reliance on the Federal Court decision in AMIEU v Fair Work Australia [2012] FCAFC 85. It notes that the case dealt with a different part of the legislation, Chapter 3 Part 3-4 and that the issues in relation to access for bargaining are different. Further, what is fair depends on the facts in each case.

[426] It is submitted that Cochlear’s refusal to seek DEEWR’s guidance on the proposed dispute settlement clause is unfair conduct, contrary to section 228(1)(e). Order 5 is necessary to counter the effect of such conduct. It is noted that the AMWU is unable to approach DEEWR itself, again because the proposal is confidential.

[427] In response to Mr Hargraves’ application the AMWU submits that none of the alleged breaches of the Act have been made out. In brief, it is submitted that the order cannot be made because the union has and is continuing to meet the good faith bargaining requirements, it would not be reasonable in all the circumstances and would not be in accordance with section 231.

[428] The AMWU submits that Cochlear’s approach has been to elevate the Protocols into an end unto themselves. The company’s conduct has been to put process before substance. The order sought by Mr Hargraves lacks certainty: ICI Australia Operations Pty Ltd v Trade Practices Commission (1992) 38 FCR 248 @ 259; Australian Paper Ltd v CEPU & Ors [1998] FCA 321 and authorities discussed therein. The Protocols are clearly not designed to be the basis for a legally binding order and making them so would give rise to numerous disputes over the serious question of compliance with an order.

[429] Cochlear’s submissions on the Protocols do not focus on the real issues to be decided. The AMWU submits that the company’s approach of undertaking a forensic analysis of the Protocols should be rejected. The union disagrees with Cochlear’s position that the Protocols were the “brainchild” of the union or that they should remain binding in perpetuity. The Protocols are not a legally enforceable document but merely an administrative arrangement: ACOA v Commonwealth (1979) 26 ALR 497 and Secola v McCann [2011] WASC 342 @ para 13ff. If, contrary to this submission, the Protocols are considered to be a contract, the union is entitled to terminate in accordance with conventional principles: Crawford Fitting Co v Sydney Valve & Fittings Pty Ltd (1980) 14 NSWLR 438.

[430] The AMWU submits that its use of the word “repudiate” in its correspondence of November 2011 was only intended to indicate termination of the Protocols rather than to operate in the legal sense of the word as discussed in Visscher v Giudice [2009] HCA 34 @ 55 (Visscher). The union rejects the suggestion that it acted precipitately in withdrawing from the Protocols. The AMWU wants to bargain without inappropriate constraints and is entitled to do so. Its position is not capricious or unfair.

[431] FWA cannot rewrite the Protocols to remove the offending ambiguities and uncertainties identified by the AMWU such as, the goals in the preamble, the absence of any proper distinction between employee representatives and employee bargaining representatives, its relationship with the requirements of section 228 and its confidentiality provisions.

[432] The AMWU addresses the company’s detailed submissions about the Protocols. In brief, it submits that Cochlear has: misrepresented many of the union’s submissions; has raised irrelevant issues of detail; misunderstood the terms and/or effect of parts of the Protocols; and, incorrectly summarised some of the evidence. The union makes similar criticisms of Cochlear’s submissions in relation to the AMWU claim.

[433] The AMWU submits that Cochlear ought not be permitted to hide behind the Protocols to avoid its obligations under the Act. It submits that the company has not addressed the real reasons for the delay in putting its April 2012 proposal. The union notes that its correspondence of 7 March 2012 did not change its position or invite a response. The only material change between August 2011 and April 2012 is the handing down of the Full Bench Endeavour Coal decision.

[434] The union submits that the circumstances of Cochlear’s past ongoing contraventions warrant the making of the orders sought by the AMWU. The provision of the April 2012 proposal has not changed that situation.

[435] The AMWU rejects Cochlear’s submissions concerning access to members and submits that the company has failed to consider important aspects of the context in which the orders are sought. Those aspects are set out in paragraph 419 above. Cochlear has also overlooked difficulties in communicating with this particular workforce and the importance of face to face meetings. The union notes that it represents all of its members not just those who are financial. It further notes that its rules do not contain any “non financial” category, neither is there any requirement that members who are not financial must be expelled. Reference is made to the AMWU’s rules, Exhibit Cochlear 35, and sections 166 and 172 of the Fair Work (Registered Organisations) Act 2009 (RAO Act).

[436] The union submits that the matters which could be discussed at meetings between it and employees should not be artificially restricted as suggested by Cochlear. The union’s motives are not relevant. The company’s submission that access to the main lunchroom would be extremely intrusive is rejected. If a contravention of section 228(1) is made out the question is whether the orders which are sought are reasonable in the circumstances.

[437] The AMWU responds in detail to each of the alternate forms of communication suggested by Cochlear. It refers to the evidence about the inadequacies of the Mural Room. It notes that meetings for bargaining purposes are different to those for ROE. In her final oral submissions Ms Howell noted that Cochlear’s late offer of a Training Room for the purposes of access meetings was not helpful. The union submits that the other, non face to face, forms of communication are clearly not suitable for the purposes of bargaining consultation. There are limitations on how much information can be disseminated through the delegates especially in such a linguistically diverse workplace.

[438] The union notes that it does not assert a general right to paid meetings but submits that these are warranted at this time to properly explain and consult about the bargaining process. The evidence shows that employees are confused and disappointed. The union submits that the decisions relied on at paragraph 341ff of Cochlear’s submissions of 28 May 2012 make it clear that FWA has the power to make orders for paid meetings if the prerequisites for making a bargaining order are made out. The orders sought will also counter effects of other contraventions.

[439] The AMWU submits that Cochlear has erroneously relied on a number of decisions which have dealt with very different factual contexts. These include: LHMU v Hall & Prior [2010] FWA 1065; LHMU v Mingara [2009] FWA 1442; CFMEU v Foster Wheeler Worley Parsons (Pluto) Joint Venture [2010] FWA 2341 (Foster Wheeler); and Tahmoor.

[440] The union notes that its complaints about the EBRs is not that they are part of the bargaining process but that they have been used by Cochlear for its own purposes of delaying bargaining and organising employee opposition to the AMWU’s claims. It notes that the evidence supports Mr Ayres’ hesitation about accepting the EBRs’ statements as to the numbers they represented, Exhibit AMWU 42. The union rejects the submission that it had overstated the number of employees it represented. Mr Ayres’ evidence was as to his general understanding of the number of union members. This proved to be close to the actual number.

[441] Cochlear’s submissions about the AMWU’s attitude towards the EBRs are rejected. Those submissions mischaracterise or do not address the relevant evidence and misrepresent the AMWU’s submissions. One example of the latter relates to the question of service of the union’s application on the EBRs. The union notes that the Act does not provide for informal representation and there is no evidence to support Cochlear’s submission that the EBRs represent a wider group of employees.

[442] The AMWU presses its submissions as to Cochlear’s control of and collusion with the EBRs and rejects the company’s submission that it brings its arguments to silence the EBRs. The union rejects the suggestion that its allegations warrant a higher “Briginshaw” standard. It submits that the matters in these proceedings are of a very different nature to those in the cases relied on in this regard by Cochlear. Section 230(3) sets the relevant standard in these matters.

[443] The AMWU submits that the most important part of the issue concerning the number and identity of the EBRs is the absence of any evidence from Cochlear to counter that put forward by the AMWU specifically in Exhibits AMWU 14 and 28. The union submits that Cochlear’s support for the EBRs went significantly beyond providing administrative assistance and arranging for access to legal advice. There is a close and compromised relationship between them.

[444] The AMWU submits that Cochlear has incorrectly characterised FWA’s discretion concerning the making of bargaining orders. The test is not whether any order will ensure effective bargaining in the future but whether it is reasonable in all of the circumstances.

[445] In Part 2 of its submissions of 15 June 2012 the AMWU provides a detailed response to Appendix B to Cochlear’s submissions of 28 May 2012. It says that much of what Appendix B puts forward as facts is but a mixture of alleged facts and submissions including many conclusions which are unsupported by evidence. It also says that the Appendix contains numerous misrepresentations of the evidence. With one exception I do not intend to outline the contents of Appendix B in this decision, consequently, I do not refer to the union’s response. I have considered both in arriving at my conclusions.

[446] The exception referred to in the immediately preceding paragraph relates to material about the credit of various witnesses. Cochlear’s submissions in that regard are set out later in this decision. The union rejects those submissions and notes that the matters on which the credit of Mr Ayres and Ms Fortescue is attacked are minor at best. The AMWU submits that Mr Ayres was an honest witness who did his best to answer questions which were frequently long winded and confusing. Ms Fortescue should be accepted as an honest and forthright witness.

[447] It is submitted that, in contrast, the evidence of Cochlear’s witnesses was unreliable in many respects. The conflict between the testimony of Mr Hargraves and Mr Jarman about the issue of whether wages were to be included in the August 2011 proposal is one telling example. The union submits that Mr Jarman was an unreliable and evasive witness who gave evidence he believed would assist Cochlear’s case. Mr Hargraves’ evidence contained implausibilities especially concerning the delays in negotiations.

[448] It its submissions of 26 June 2012 and oral submissions on 9 July 2012 the AMWU notes that Cochlear’s April 2012 proposal has not cured the contraventions of section 228 associated with the company’s prior lengthy delays. The effects of the contraventions still need to be addressed and the evidence shows that, without the orders sought by the union, Cochlear will likely continue with its behaviour.

[449] The union rejects Cochlear’s compartmentalisation of elements of its conduct. An essential part of the union’s case is the company’s total course of conduct. It notes that the Full Bench Endeavour Coal decision makes it clear that an aggregate approach to the whole of the evidence is required in determining whether the statutory tests have been met and whether orders should be made.

[450] In her oral submissions Ms Howell submitted that orders can be more than remedial in the narrow sense contended for by Cochlear but rather, be designed to deal with the effects of breaches. It is a question of what is fair and reasonable in the circumstances.

SUBMISSIONS ON BEHALF OF COCHLEAR

[451] Cochlear provided the following written submissions:

[452] Mr Wood also made oral submissions on 30 April and 9 July 2012.

[453] Cochlear notes that applications for good faith bargaining orders are not applications for declarations about a party’s conduct during bargaining negotiations. FWA can only make an order if the requirements of section 230 of the Act are met. Cochlear submits that, in considering the requirements of the good faith bargaining obligations, it is necessary to take note of the following principles:

[454] Cochlear submits that it has always considered the Protocols to be a legally binding document. They amount to an industrial deal freely entered into by mature industrial parties. In considering the nature of the Protocols it is necessary to take account of the type of document it is, the manner of its expression, the context in which it operates and the industrial purpose it serves: Amcor Limited v CFMEU (2005) 222 CLR 241 @ 270; and Kucks v CSR Ltd (1996) 66 IR 182 @184.

[455] FWA should not interfere with the operation of the Protocols but require the AMWU to comply with them by making the order sought by Mr Hargraves. The AMWU has breached the requirements of section 228(1)(b)(c)(d) and (e) by failing to comply with the Protocols, seeking to repudiate them and failing to take steps to renegotiate them. Those breaches form the basis for the order sought.

[456] Cochlear notes that inadvertent breaches of an agreed process may not give rise to a contravention of the statute however, when considered as a whole, the AMWU’s conduct is unfair and capricious and undermines collective bargaining. Cochlear refers to the Explanatory Memorandum to the Fair Work Bill 2009 (Explanatory Memorandum) and the dictionary definitions of “capricious”, “caprice” and “undermines” as well as the decision in the LHMU v Coca-Cola Amatil (Aust) Pty Ltd [2009] FWA 153 in this regard.

[457] The company provides a detailed analysis of the Protocols and the AMWU’s conduct in relation thereto. Cochlear notes that the Protocols provide that they are to operate alongside the good faith bargaining requirements of the Act, not subject to them. It notes that the AMWU’s complaints about the scheduling of meetings shows a lack of understanding of the realities of commercial life.

[458] The company recognises the role of employees in negotiations but notes that this needs to be balanced with work and operational requirements. There is no automatic right to attend bargaining meetings. Cochlear submits that not enforcing the Protocols will return the parties to a lengthy period of disputation about a range of issues especially the number of employee representatives to attend meetings.

[459] Cochlear agrees that meetings could be held more frequently than 14 days apart if they would be beneficial to negotiations and allow for sufficient consultation with stakeholders. The EBRs have agreed to such a proposal, however, the AMWU has not. Cochlear also agrees that, on occasion, there is merit in extending the duration of meetings beyond the two hours as laid down in the Protocols. The Company suggests that the minimum notice period for agenda items could be reduced to two days.

[460] Cochlear submits that the AMWU’s contention that it ceased objecting to the contents of Minutes of the bargaining meetings to reduce disputation should be rejected. Discussions about disputed issues were minimal in length and fruitful in outcome. The company also submits that the union’s concerns about the possible unfair application of the disputes mechanism of the Protocols are not credible. The AMWU did not attempt to discuss the use of a mediator before bringing its present application.

[461] The company submits that the confidentially of relevant bargaining material is a substantial and important issue in these matters. The dissemination of such material as a result of any failure to impose the Protocols would be very unfair. It could also lead to a misinterpretation of a party’s bargaining position to the detriment of reaching agreement.

[462] Cochlear notes that neither it nor the EBRs have accepted the AMWU’s repudiation of the Protocols, consequently, the agreement remains on foot: Visscher. The attempt to unilaterally terminate the Protocols is a breach of the Protocols themselves and amounts to a breach of good faith bargaining requirements of the Act, especially section 228(1)(e): ASU v NCR Australia Pty Ltd [2010] FWA 6257 @ para 11. The AMWU’s action undermines the integrity of the bargaining process and collective bargaining and denies Cochlear and the EBRs their rights under the Protocols.

[463] Cochlear submits that, in agreeing to the Protocols, the AMWU represented to it that it intended to be bound by them. In withdrawing from the Protocols the union has misrepresented its position to Cochlear. A misrepresentation by a bargaining representative may lead to a finding of unfair or capricious conduct regardless of whether the action was intentional: Jupiters Limited v United Voice [2011] FWA 8317 @ para 32 and TWU v Veolia Transport Queensland Pty Ltd [2011] FWA 5691 @ para 62.

[464] It is submitted that the union’s failure to seek renegotiation of the Protocols despite raising concerns in a section 240 dispute notification is behaviour which is capricious and unfair. This is especially so in light of Cochlear inviting discussions about any such concerns. The AMWU provided no response until after formally repudiating the Protocols. Consequently, Cochlear had no opportunity to consider the concerns: NUW v Defries Industries Pty Ltd [2009] FWA 88 @ para 64.

[465] Cochlear has put various proposals to the union concerning possible amendments to the Protocols. These have been rejected. The company notes that the AMWU agrees that there need to be some arrangements in place to govern future bargaining. The question is the scope and content of such arrangements.

[466] Cochlear submits that it has not breached the good faith bargaining requirements of the Act. Alternatively, if it is found to have done so, it would be unreasonable for FWA to make any of the orders sought by the union. The company rejects each of the allegations made against it relating to the procedure of the negotiations, the timing and substance of its responses, its relationship with the EBRs and the union’s access to members and other employees. Cochlear notes that it hasn’t received written notice of some of the alleged contraventions as required by section 229(4).

[467] Cochlear submits that a number of procedural issues needed to be decided before bargaining could commence. Its decision to finalise the Protocols before entering into substantive negotiations was sensible and appropriate. The company attended and participated in all meetings during the negotiation of the Protocols.

[468] Cochlear submits that its expectation that the parties comply with the Protocols during the bargaining process could not possibly be considered a breach of its good faith bargaining obligations. Further, it did not insist on unwavering adherence to the Protocols during bargaining. The company has not refused to attend or participate in meetings at reasonable times either before or since November 2011. The availability of its bargaining representatives is a relevant consideration in this regard.

[469] Cochlear provides a detailed analysis of each event during bargaining. It submits that delays in that process were caused by several different factors and not by it alone. It submits that the lack of clarity in the AMWU’s claims meant that it was necessary for Cochlear to ask questions of the union in order to give genuine consideration to the proposal as required by section 228(1)(d). There is nothing inappropriate in the company’s bargaining strategy in this regard: Total Marine Services v Maritime Union of Australia [2009] FWA 290 @ para 46. Cochlear submits that its decision not to revise its August 2011 position until after receiving a response from the AMWU in March 2012 is a legitimate bargaining strategy. FWA should be slow to interfere with it: LHMU v Fosters Australia Ltd [2009] FWA 750 @ para 207 (Fosters).

[470] Cochlear submits that the AMWU has misinterpreted the obligation in section 228(1)(c) and in doing so has narrowed the parameters of the section. Cochlear rejects the union’s submission that it has failed to respond to the AMWU’s proposals in a timely manner. Reference is made to paragraph 951 of the Explanatory Memorandum and the dictionary definition of “respond”. Cochlear submits that it has provided a response, indeed, two responses.

[471] The company submits that FWA’s jurisdiction is “forward looking” and the terms of the Act suggest that the focus of the good faith bargaining provisions is on future conduct. Something more than past failings are required to provide the basis for a bargaining order. Cochlear submits that, in that context, FWA should focus on the company’s proposal of April 2012 rather than trailing through the August 2011 proposal.

[472] Cochlear rejects the union’s submission that the August 2011 proposal would not pass the BOOT. In any event, the question is not relevant to the issue of whether a party is bargaining in good faith: AMWU v DTS Food Laboratories [2009] FWA 1854 @ paras 20/1. The company agrees that the April 2012 proposal does not cover all of the matters that the AMWU wants to be in an agreement however submits that is just part of bargaining.

[473] Cochlear rejects the union’s contention that it has placed any condition, including the company’s international competitiveness, on its obligation to genuinely consider the AMWU’s claims. Although that factor is important to Cochlear it has not operated to prevent genuine consideration of the union’s position. Cochlear submits that it will continue to give genuine consideration to the union’s claims and part of that consideration will include an assessment of any impacts upon the company’s international competitiveness. Cochlear notes that section 228(2) makes it clear that parties are not required to make concessions during bargaining. The decision of Re Australian Rail, Tram and Bus Industry Union (Print L5622) is relevant.

[474] Cochlear submits that the AMWU is seeking access to all employees as part of its recruitment campaign at Cochlear. It submits this is because of the union’s inability to increase its membership position since the MSD. Cochlear refers to the statutory declaration at pages 190 to 194 of Exhibit Cochlear 35 and notes that a number of the union’s members are not financial. The company submits that the evidence and the union’s refusal to offer any undertaking that it will not discuss union membership during access visits highlights its inappropriate motives in seeking access.

[475] Further, it submits that the orders sought by the union would intrude on production to a significant extent and should not be issued in the terms sought. The AMWU has several ways in which it can communicate with employees including ROE, phone, email, SMS, letters, flyers, meetings outside the company’s premises and elsewhere, and through the delegates. The company submits that the relevant issue is not whether the AMWU has effectively communicated but whether it is incapable of doing so without an order. Cochlear submits that any shortcomings in the communication process has been the result of the union’s choice not to access those alternate methods.

[476] The company submits that the fact that the AMWU has made only two ROE visits during the period of substantive bargaining should strongly weigh against granting any access order. The responsibility for the employees’ lack of information about bargaining rests with the union. It would not be reasonable for FWA to make orders when the evidence demonstrates that the AMWU has made no attempt to arrange external meetings or use the noticeboard and only very limited attempts to utilise phone, email and postal communications and flyers. Cochlear submits that it cannot be blamed for the failure of delegates to pass on information to other employees.

[477] Cochlear rejects the AMWU’s contention that its refusal to grant paid meetings is due to the Protocols or that it is breaching the good faith bargaining requirements by such refusal. It submits that the general rule is that meetings in work time must be held with consent of the employer. Requiring the AMWU to seek its agreement for any meeting in those circumstances cannot be a breach of the Act. Cochlear is entitled to refuse a request for such a meeting provided it is not acting unfairly or capriciously: TWU v TNT Australia Pty Ltd [2011] FWA 1543 and Fosters.

[478] Paid meetings are costly and should be ordered only where an employer has unreasonably refused requests in the context of a history of granting them. There is no such history in this case. The only paid meeting ever granted was in the lead up to the MSD ballot.

[479] Further, on each occasion on which the AMWU has requested a paid meeting, Cochlear has considered the request on its merits. In so doing, Cochlear had decided that, thus far, the cost of halting production was not justified when the union could communicate with employees by other means. There has been no blanket refusal of paid meetings. Cochlear may be willing to grant a paid meeting when agreement is reached or in certain other situations.

[480] The company submits that, if the AMWU really wanted to inform employees about the bargaining, it could have used its ROE powers more frequently or held external meetings. Further, if it really wants to consult about bargaining proposals it should be seeking meetings with members only as they are the ones the union represents in bargaining, not employees generally.

[481] Cochlear rejects the allegation that it has held paid meetings with employees to discuss bargaining. The only meetings at which bargaining has been mentioned have been the regular production meetings and then only briefly. It submits that there is no evidence that it has any ulterior purpose of attempting to improperly influence employees’ views about bargaining in any of its communications with the employees. Relevant cases are set out at paragraph 439 above. The EBRs have been directed not to discuss bargaining during work time. If they have acted contrary to this direction it is irrelevant to the question of the company’s possible contravention of the good faith bargaining requirements.

[482] Cochlear submits that its provision of the Mural Room for union meetings complies with the ROE requirements of Part 3-4 of the Act. It further submits that, if one part of the legislation permits a particular action it cannot be considered to be a breach of another section.

[483] The union can only require Cochlear to allow it onto its premises pursuant to the ROE provisions, specifically section 484. It otherwise requires an invitation. The union’s right to enter is not unfettered and Cochlear has exercised its ability to impose certain conditions one of which has been, in general, to require the use of the Mural Room.

[484] Cochlear refers to the provisions of section 492 and submits that the question of what is reasonable depends on all of the circumstances at the time the request is made and a consideration of the interests of all parties. The AMWU cannot insist on a particular room and there is no general right to hold meetings in a lunchroom. Cochlear notes that the union can only require access to a room which is fit for the purpose of discussions with employees, not mass meetings. Several decisions are relied upon as the basis for these propositions: AMIEU v Dardanup Butchering Company Pty Ltd [2011] FWAFB 3847; AMIEU v Goodchild Pty Ltd [2011] FWA 8228; Foster Wheeler; Somerville Retail Services Pty Ltd v AMIEU [2011] FWAFB 120 and the Federal Court judgment concerning the application for writs against the Full Bench in the Somerville decision: [2012] FCAFC 85.

[485] Cochlear submits that the union’s previous behaviour is relevant to the issue of whether it should be given access to the main lunchroom. Other relevant factors include the right of employees to choose whether they want to be disrupted during their lunch break.

[486] Cochlear submits that the Mural Room is fit for the purpose of discussions with employees. However, in its submissions of 5 July 2012, Cochlear offers the use of a Training Room which it says has a larger capacity than the Mural Room. Cochlear submits that the main lunchroom would not be suitable because of the disruption to other employees. The company notes that the union has never notified an ROE dispute about the allocation of the Mural Room for its meetings.

[487] Cochlear contends that the AMWU has sought to downplay, exclude and vilify the EBRs and views them as competition in the negotiation process. The company notes that the EBRs have the right to participate in and be recognised in the bargaining process regardless of the numbers they represent. The union has an obligation to engage with the EBRs in the negotiations. The AMWU’s behaviour towards the EBRs has not reflected this obligation, for example, by not providing them with relevant documents including notification of the union’s present application. The company submits that the union’s behaviour towards the EBRs both during bargaining and in these proceedings is completely unacceptable.

[488] Cochlear submits that the EBRs formally represent 61 employees in addition to informally representing other employees. Any failure of the EBRs to provide the company with relevant nomination forms does not invalidate their appointment. Section 178(1) clearly provides that such an appointment comes into force on the day specified in the document. This is not affected by the requirements in subsection (2) that forms be provided to the employer.

[489] Cochlear submits that there are issues about the number of employees represented by the AMWU. Nevertheless the question of numbers is not relevant to the negotiations. The company recognises the rights of both the union and the EBRs in the process. Cochlear submits that, in view of the seriousness of the allegations the AMWU has made of improper influence by the company over the EBRs, the “Briginshaw” standard applies. Findings should only be made if the evidence is so substantial as to establish the allegations clearly: Bigg v NSW Police Service (1998) 80 IR 434 @456; Wang v Crestell Industries Pty Ltd (1997) 73 IR 454 @ 463/4; Four Sons Pty Ltd v Limsiripothong (2000) 98 IR 1 @ 10/15; and Helton v Allen (1940) 63 CLR 691 @ 701/2.

[490] The company denies that it controlled the number and identity of non-union bargaining representatives, colluded with the EBRs to delay bargaining or assisted the EBRs to increase their support among employees. Cochlear submits that no useful inference can be drawn from Exhibit AMWU 34.

[491] Cochlear submits that each of the requirements of sections 229 and 230 has been met in relation to Mr Hargraves’ application. The AMWU has breached the good faith bargaining provisions in refusing to meet in accordance with the Protocols. The order sought is consistent with section 231(1)(a) and it is reasonable that it should be made. Cochlear notes that it has proposed a modified version of the Protocols and is prepared to discuss further changes if the AMWU requests. The company submits that its proposal is a practical one which would facilitate effective bargaining.

[492] Cochlear submits that FWA has no jurisdiction to make the orders sought by the AMWU. The union has either not provided notice of or has given inadequate notice of several of the alleged contraventions as required by section 229(4) and it would not be appropriate to relieve the AMWU of this obligation. Further, Cochlear has not breached the good faith bargaining requirements of the Act. In the alternative, it would not be reasonable to make any of the orders sought by the union. FWA should be slow to make bargaining orders and should be cognisant of the fluid nature of bargaining. A circumstance which might require a remedy may change and it would be inappropriate to make an order to fix a problem which no longer exists.

[493] As indicated in paragraph 445, Cochlear has provided a detailed analysis of what it says should be the factual findings in these matters. This is contained in Appendix B to the submissions of 28 May 2012. I do not intend to outline that material here except to note that Cochlear makes a number of submissions as to matters of credit. The company submits that where there are competing factual assertions its position should be preferred to that of the union. It also submits that, in contrast to the evidence given by Mr Ayres and Ms Fortescue, each of Cochlear’s witnesses presented as honest and reliable witnesses and their evidence should be accepted.

[494] In its reply submissions of 15 June 2012 Cochlear submits that the AMWU has adopted an incorrect approach towards section 230. In particular, bargaining orders are not to be issued as punishment for past behaviour but as a means of facilitating bargaining and to assist parties to reach agreement.

[495] Cochlear makes detailed submissions about the rule in Jones v Dunkel. It submits that either party could have called the EBRs to give evidence but chose not to do so. Consequently any inference cancels each other out : Galea v Bagtrans Pty Limited [2010] NSWCA 350 @ para 54. Ms Fitzhenry is a former employee of Cochlear and she is therefore not a witness that it would be natural for it to call. No inference should be drawn from her absence: Shum Yip and Claremont Petroleum. There was no particular relevant evidence which could have been given by the other human resource generalist, Ms Leffler or by the Production Manager, Mr Lopez. Cochlear submits that the AMWU is seeking to use the rule in Jones v Dunkel to fill gaps in evidence which is an improper use of the rule: Tamayo v Alsco Linen Service Pty Ltd [1997] AIRC 92.

[496] The company also makes further submissions on this issue in its 5 July 2012 supplementary submissions. These address the significance of any inference and the question of the seniority of any employee not called as well as the position of the EBRs. Several decisions are relied upon.

[497] Cochlear strongly refutes the union’s contention that it has refused to meet since November 2011. The reason meetings have not taken place is the union’s refusal to meet under the Protocols. Cochlear has proposed amendments to the Protocols to address the AMWU’s concerns but has been rebuffed. Cochlear submits that the real inquiry under section 228(1)(a) is which party is at fault for the failure for there to be any meetings since November. The company submits that the fault lies with the union. Further, the AMWU has acted capriciously in withdrawing from the Protocols.

[498] The company submits that most of the allegations put against it about its conduct during the negotiations of the Protocols are no longer of any practical relevance. In any event there has been no breach of the good faith bargaining requirements.

[499] Cochlear submits that the union has altered its allegations about the company’s use of the Protocols during bargaining to fit within the scope of the Endeavour Coal decision. This should not be permitted in circumstances where notice was not provided to Cochlear in accordance with section 229(4). Cochlear refutes any suggestion that, in requiring that negotiations occur under the Protocols, it is in breach of the legislation. It rejects the submission that it has refused to vary the Protocols. Cochlear submits that it has adopted an adversial approach only in response to the AMWU’s behaviour. The company strongly denies that the Protocols have caused disputation and uncertainty, on the contrary, it is the AMWU’s conduct which has caused those difficulties.

[500] Cochlear contends that its response to the AMWU’s claims was provided in a timely manner, first by asking questions both written and orally and then by advising the union of its acceptance or otherwise of each claim orally and then in writing. It submits that section 228(1)(c) does not require that a response be in a particular form. In any event, in light of Cochlear’s April 2012 response, this is no longer a live issue.

[501] The company submits that the allegations made by the AMWU in support of proposed Orders 3 and 4 have not been made out or are no longer of any relevance to the relief sought. This includes the allegations relating to the negotiation of the Protocols and treatment of the EBRs. In relation to the latter it is submitted that the evidence is clear that the EBRs were not provided with broader access to employees than the union. The only nomination forms which were provided to the EBRs were at their request and obviously contained their names. Cochlear submits that Exhibit AMWU 34 does not support the union’s allegations. Cochlear notes that its witnesses were not asked whether the EBRs were being given assistance in order to increase their support base. Further, there is nothing in section 228(1)(e) which prevents the giving of assistance to one bargaining representative and not another. In view of the lack of industrial relations experience of the EBRs, Cochlear’s assistance to them was entirely appropriate.

[502] Cochlear submits that the AMWU has not made out the basis of any breach of section 228(1)(e) arising from the company’s refusal to grant paid meetings. It submits that it would be inappropriate to grant the orders seeking paid meetings when there is no proper basis for them. FWA’s function is to remedy a breach of the good faith bargaining obligations and facilitate bargaining. Cochlear submits that there is nothing unfair in refusing paid meetings provided proper consideration is given to each request. There is no evidence that the company’s refusals were caused by any intention to delay negotiations. Further, neither Cochlear nor the EBRs have conducted meetings in paid time.

[503] Cochlear supplements its submissions about use of the main lunchroom for access meetings by reference to the Full Federal Court decision concerning the Somerville matter referred to earlier: [2012] FCAFC 85. It submits that the decision provides that ROE access is not for the purpose of holding general discussions with employees, the interests of those who may be inconvenienced or who do not wish to participate are relevant to consider and the room to be made available is within the control of the occupier provided it is reasonable.

[504] Cochlear submits that the undertaking proffered by the AMWU does not address these concerns, in particular, there is no restriction on discussions about union membership. Although the union has sought the order for access to the main lunchroom as a good faith bargaining matter it is in truth a right of entry dispute and should be dealt with consistently with the provisions of Part 3-4.

[505] The company provides a detailed analysis of the AMWU’s justifications for the access orders and submits that none of these is made out.

[506] Cochlear submits that it has not been given notice of the new proposed Order 5 and, in any event, its position in relation to the disputes procedure is not in breach of any good faith bargaining requirements. The company recognises that there may be issues about whether its proposed clause complies with the Fair Work Principles and User Guide, however notes that these are policy documents and would not prevent the approval of an agreement under the Act. The difficulty arises from the company’s desire to have a consent arbitration provision but not be excluded from government contracts.

[507] FWA has no power to require Cochlear to agree to any particular disputes procedure or impose some alternative approach as a “fairer” option: Murray Bridge. The question is whether requiring Cochlear to seek DEEWR’s guidance now rather than later is reasonable. The company submits that its approach is commercially logical and reasonable whereas the union’s approach will cause further delay.

[508] Cochlear submits that there is no justification for an order requiring the continual involvement of FWA in the bargaining process.

[509] Cochlear notes that the AMWU has made a number of allegations which no longer relate to the relief the union seeks. The company submits that these are not relevant and should be disregarded.

[510] In its submissions of 27 June 2012 Cochlear provides specific detailed responses to the union’s 15 June material. It rejects the suggestion that it has misrepresented the evidence and submissions of the union but notes that the AMWU’s case has rested on “shifting sands” and has been difficult to properly understand and distil.

[511] The company agrees that any order of FWA should be clear and unambiguous but rejects any suggestion that the Protocols are in any way ambiguous. Cochlear also rejects the submission that the Protocols contain an implied term which permitted termination on reasonable notice. It submits that Crawford Fitting Co, relied on by the union, is distinguishable. The Protocols are more akin to a contract for a particular project and there is no room to imply a termination clause: Dempster v Mallina Holdings Ltd (1994) 13 WAR 124 @ 170/1. Cochlear submits that repudiation may be found in a wider variety of instances than that submitted by the union: Koompahto Local Aboriginal Land Council v Sanpine Pty Ltd (2007) 241 ALR 88 and Whittaker v Unisys Australia Pty Ltd [2010] VSC 9.

[512] Cochlear submits that the AMWU has miscast many of the company’s submissions and has mischaracterised many facts. The company provides a very detailed analysis of issues it says arise from the union’s reply submissions.

[513] In his oral submissions Mr Wood submitted that the AMWU had been provided with the opportunity to curtail the scope of the proceedings but had refused to do so. He submitted that, because of the orders now sought, it was not necessary to inquire into every aspect of the conduct of the parties. However, if this was undertaken then a close analysis of the whole bargaining process is required: APESMA v BHP Coal Pty Ltd [2012] FWA 4435.

[514] Mr Wood submitted that good faith bargaining orders need to be both remedial and reasonable. They need to remedy any identified failings and be forward looking. Mr Wood noted that Orders 1 and 2 could be made if there is a finding that either or both parties are at fault in not meeting since November 2011. However he submitted there is no basis for Orders 3, 4, 5, 6 and 7.

SUBMISSIONS ON BEHALF OF THE EBRs

[515] Written submissions on behalf of the EBRs were provided on 30 May and 6 July 2012. Mr Brown made oral submissions on 31 May and 9 July 2012.

[516] The EBRs want bargaining to continue in accordance with the Protocols. They reject any inference or allegation that they have any inappropriate relationship with Cochlear or that their position as bargaining representatives has been manipulated or influenced by the company.

[517] The EBRs submit that they have been the victims of a campaign by the AMWU and various employees which has undermined their role in the bargaining process. Further, the allegations put against them in these proceedings has put them in a difficult position with their peers.

[518] The EBRs submit that there should not be any findings made which are critical of them. They have not breached the good faith bargaining provisions of the Act. They support the company’s submissions as to findings and orders which should be made.

ADDITIONAL SUBMISSIONS

[519] Ten days after I reserved my decision in these matters the Federal Court of Australia delivered judgment in an application for prerogative writs against the Full Bench in the Endeavour Coal matter: [2012] FCA 764. The parties in the present matters have been provided with the opportunity to make brief submissions on the judgment. The AMWU and Cochlear have availed themselves of that opportunity. The EBRs are content to rely on their earlier submissions.

STATUTORY FRAMEWORK

[520] The objects of the Act and of Part 2-4, which deals with enterprise agreements, both provide context for the specific sections which deal with good faith bargaining.

[521] Section 3 relevantly provides:

[522] Section 171 provides:

[523] Division 8 of Part 2-4 deals with FWA’s general role in facilitating bargaining and contains the most immediately relevant provisions.

[524] Section 229 concerns applications for bargaining orders. There is no dispute in these proceedings that subsection (1) has been met. Subsection (2) is not relevant and there is no issue concerning subsection (3). There are however issues about subsections (4) and (5). Those subsections provide:

[525] Section 230 then sets out the circumstances in which a bargaining order may be made.

[526] Section 231 sets out what a bargaining order must specify.

CONCLUSIONS

[527] Before addressing the question of whether the good faith bargaining requirements of the Act have been met, I need to consider some preliminary issues. The first concerns the prerequisites for making an application for a bargaining order as set out in section 229(4). In short, the subsection provides that an application may only be made if a bargaining representative has concerns that the good faith bargaining requirements are not being met, has given written notice of those concerns to relevant bargaining representatives, has given those representatives a reasonable time in which to respond and considers that there has been no appropriate response.

[528] The AMWU provided Cochlear with written notice of its concerns on 7 June 2011, 28 June 2011 and 5 December 2011. On each occasion the union requested a response, either within seven days or, in relation to the first notice, at the next bargaining meeting. In each instance Cochlear provided a response. Clearly the AMWU did not consider the responses to be appropriate. I am satisfied that section 229(4) has been met by the AMWU in respect of the concerns that it raised on the dates set out above.

[529] However Cochlear submits that, because the union has raised other concerns and allegations during the proceedings, it has not received proper notice of those matters or been given an opportunity to respond. It contends that, as a consequence, there is no jurisdiction to deal with those matters.

[530] The proceedings in relation to these applications have been very extensive. Parties have been given full and proper opportunities to respond to all issues that have been raised and have availed themselves of those opportunities. I am satisfied that, pursuant to section 229(5), in the particular circumstances of this case it is appropriate to consider all of the allegations which have been raised even if there have been some inadequacies in meeting the prerequisites of subsection (4) in relation to each and every one of them.

[531] I also consider that it is appropriate to consider proposed Order 5 sought by the AMWU which has arisen only in response to Cochlear’s 30 April 2012 proposal. In the circumstances it would not be reasonable to require the union to meet each of the prerequisites in respect of this issue and make a separate application. Similarly, I am satisfied that, although the EBRs did not receive formal notice of the allegations against them, it is nevertheless appropriate to consider the union’s application insofar as it applies to them.

[532] There is no suggestion that Mr Hargraves has not met the prerequisites for making his application. I note that he provided formal notice of his concerns in correspondence to the AMWU on 7 September 2011.

[533] The second preliminary issue I wish to consider is the question of witness credit. As indicated earlier, both the AMWU and Cochlear made submissions that the evidence of their respective witnesses should be preferred to that of the other party’s witnesses. In considering this issue it is important to note the context of the proceedings. The parties have come to the bargaining from very different positions and a great deal of the evidence, especially under cross-examination, concerned matters about which it would be quite reasonable for individuals to hold opposing but truthful views.

[534] I am generally satisfied that each of the witnesses was honest and attempted to provide their evidence truthfully. Each of the union’s witnesses and Mr Howitt were clear, firm and responsive in their evidence. At times both Mr Hargraves and Mr Jarman appeared to be reluctant to responsively answer questions under cross-examination. However, I gained the impression that this was due to excessive caution rather than any attempt to be evasive.

[535] There was some difference between the evidence of Mr Hargraves on the one hand and that of Mr Jarman and Mr Howitt on the other concerning the issue of whether the company had intended to include wages in any proposed agreement. However I do note the evidence of Mr Jarman that there were different views within Cochlear on this issue.

[536] The third preliminary issue to be considered is the Jones v Dunkel point concerning the absence of the EBRs, the company’s two human resources generalists and the Production Manager as witnesses in the proceedings. The Full Bench decision in Huang v Rheem (PR954993) helpfully summarises the relevant rules. After noting that it is a rule of “commonsense and fairness in relation to the fact finding process”, the Bench stated as follows:

[537] I am not satisfied that the EBRs were in Cochlear’s “camp”. The evidence shows that they were closer to the company than to the union but, in my view, that does not mean that it would have been natural for the company to have called them to give evidence. It is also of note in this regard that the EBRs were in effect, parties in the proceedings and could have decided to give evidence themselves.

[538] The fact that Ms Fitzhenry is no longer an employee does not mean that it would not have been natural for Cochlear to have called her to give evidence. There was nothing to suggest that the ending of the employment relationship was in any way acrimonious. It would have been helpful to have heard her evidence. In the circumstances I am prepared to draw an adverse inference from her absence. It needs to be emphasised however that the inference is that Ms Fitzhenry’s uncalled evidence would not have assisted Cochlear’s case. It goes no higher than that.

[539] Clearly Ms Leffler and Mr Lopez are current employees and within Cochlear’s “camp”. However, I am not sure that they could have provided anything other than peripherally relevant evidence.

[540] The fourth preliminary issue concerns the question of the number of employees who are represented by the EBRs and the number who are members of and represented by the AMWU. Much was made of this question by the AMWU and Cochlear. However the fact is that the EBRs and the AMWU are entitled to exercise all of the rights and responsibilities as bargaining representatives under the Act regardless of the numbers they represent. All of the bargaining representatives should recognise this as bargaining continues.

[541] I now turn to the main substantive issue in the proceedings: whether there has been any failure to meet the good faith bargaining requirements of the Act. The judgment of the Federal Court in Endeavour Coal sets out a detailed analysis of the operation of the good faith bargaining requirements: paragraphs 30 to 52.

[542] The Court concludes that, once a majority support determination has been made, an employer must approach bargaining with a genuine, or good faith objective to conclude an enterprise agreement if possible. A bargaining representative may be found to have not met the requirements of section 228(1) if there is a failure to put forward a proposal which may be acceptable. The Court notes however that parties are not required to bargain in any particular manner and that the requirements of section 228(1) are limited in scope by the provisions of subsection (2). Nevertheless, bargaining parties are obliged to genuinely participate in the process and cannot merely reject proposals put by other representatives. The Court notes that the legislative purpose of section 228(1) is to impose a requirement to not just bargain in good faith but to bargain to achieve an enterprise agreement, if possible.

[543] As will have become apparent from the summary of the evidence in these matters, the AMWU and Cochlear have had a rather difficult relationship for some time. Such a situation does not provide the best base for bargaining. Further friction has resulted from the fact that the parties appear to be approaching the process from very different, though understandable, angles. The AMWU is very experienced in negotiating in an industrial context. The evidence of Mr Jarman and Mr Howitt revealed more of a commercial negotiating approach. All of these factors have contributed to the extraordinary length and complications of the bargaining process thus far. The evidence shows that both parties have been responsible for delays in the process. In my view it is neither helpful nor necessary for me to apportion blame for particular delays.

[544] A consideration of all of the evidence and a close analysis of the bargaining leads me to conclude that, with one exception, Cochlear has not engaged in a course of conduct which offends the good faith bargaining requirements. The company has fought hard and has taken every procedural point however unfortunately, that appears to be a reflection of the adversarial nature of the relationship between the parties. I do not consider that Cochlear’s conduct in relation to the Protocols or its imposition of additional requirements such as the signing of the Minutes, has contravened the good faith bargaining requirements of the Act.

[545] However, I consider that Cochlear’s actions between December 2010 and July/August 2011 amount to a failure to respond to the AMWU’s proposal for an agreement in a timely manner. As the Federal Court Endeavour Coal decision makes clear, a bargaining party cannot be required to bargain in any particular way or to put any particular type of response. Clearly Cochlear’s approach of asking questions of the AMWU in order to understand the union’s claim is a kind of response and cannot be criticised. Similarly, the July/August 2011 response in itself cannot be attacked. It is a very minimal position but there is nothing intrinsically offensive in that.

[546] However, there was nothing in Cochlear’s response which could not have been put much earlier in 2011. Dragging out the process by refusing to put its response until after the EBRs had formally filled out the bargaining issues table just because that had been agreed was simply a case of putting process ahead of substance. The company knew by March that the EBRs did not intend to put any positive claim to which Cochlear would need to respond. The fact that the EBRs might have changed their minds is not the point. Any of the bargaining representatives might seek to add or remove claims or proposals during the process. That is bargaining.

[547] I realise that it is more than a year since the relevant conduct occurred and things have moved on, for example, the company has provided its April 2012 response. However that has not in effect “wiped the slate clean”.

[548] I am satisfied that by this conduct Cochlear has not met the good faith bargaining requirements, in particular, that set out in section 228(1)(d).

[549] Both Cochlear and the AMWU have refused to meet since November 2011. Each has indicated a preparedness to meet but only on their respective terms: the company insists that any meeting take place under the Protocols as varied by agreement and the union insists that meetings be held under the Act and outside of the Protocols. Both parties have provided good reasons for their separate positions and I am satisfied that those positions are genuinely held. In a technical sense both parties are at fault in refusing to meet and consequently each has contravened the good faith bargaining requirements in section 228(1)(a).

[550] I do not consider that Cochlear has acted unfairly in refusing to agree to requests for paid meetings. The evidence does not disclose any history of paid meetings. Indeed there has only been one such meeting previously and that was in lead up to the ballot for the MSD. I accept that Cochlear has not held meetings with employees in paid time of a kind which could be considered to have given rise to unfairness to the AMWU. Mr Howitt has made a brief mention of bargaining at two production meetings in 2011 and there has been some minimal discussion at an ECC meeting. By these actions Cochlear has not misused its position or disadvantaged the AMWU.

[551] I do not consider that the EBRs have interacted with employees in a manner which could be held to be meetings which give rise to unfair conduct. I accept that, on occasions, the EBRs may have held some discussions about bargaining with other employees, however, that is no different to the discussions which the AMWU delegates have had or could have had with employees.

[552] I am not satisfied that Cochlear has manipulated the number and the identities of the bargaining representatives. Clearly Mr Jarman had a preference for a smaller rather than a larger number however there is insufficient evidence that this preference was used by the company to prevent other employees from being nominated. There is evidence that some other employees might have been interested in participating in the process, for example, as indicated in Exhibits AMWU 14 and 27. However there is nothing to show that any were prevented from participating.

[553] Cochlear acknowledges that it has provided assistance to the EBRs throughout the course of the bargaining. In very many instances the provision of assistance to one bargaining representative and not to another would amount to a breach of the good faith bargaining requirements. However it needs to be remembered that the EBRs are apparently not experienced in industrial relations. The AMWU is very experienced. I do not consider that giving the EBRs administrative assistance including the provision of nomination forms or help to complete the bargaining issues table to be a problem.

[554] Cochlear’s arrangement by which the EBRs have been able to access legal advice and representation is somewhat unusual but not inappropriate in the particular circumstances.

[555] The only area where I consider that Cochlear may have crossed the line in relation to the EBRs concerns Exhibit AMWU 34. This document was apparently prepared by Ms Fitzhenry. I have already addressed the question of her absence as a witness and my preparedness to infer that her evidence would not have assisted Cochlear’s case. Without that evidence the basis of the document is unclear. It is headed as a draft. However it does appear to indicate that Mr Hargraves was to be contacted about briefing points for the EBRs. Mr Hargraves was not questioned about whether he was contacted and/or provided any briefing points.

[556] In my view it would be totally inappropriate for Cochlear to have provided the EBRs with briefing points. Such an action would go beyond providing administrative assistance and would amount to unfair and capricious conduct which undermines collective bargaining. However, in the absence of any questioning of Mr Hargraves on this issue I am not prepared to make such a finding.

[557] Several observations should be made about the question of the AMWU’s access to employees and the allied issue of access to the main lunchroom. I agree that the union has a number of different ways in which it can contact its members. However, methods such as telephone access either for calls or SMS are not practical in the context of discussing bargaining issues with a large group of employees especially where there is such a diversity of linguistic backgrounds.

[558] Email access might be suitable in an office situation where every employee has a computer terminal on their desk and has the opportunity to spend their breaks considering and responding to non-work related material sent to them. I accept that Cochlear’s main lunchroom contains some computers which are available for the use of employees. However, the sheer number of employees and the limited length of the breaks as well as the language issues does not make email access very practical in a bargaining context.

[559] Other methods such as flyers, letters, questionnaires and meetings on the nature strip have their uses but are not suitable for a discussion of bargaining issues especially in the context of this particularly complex process.

[560] I agree that the AMWU has not used its ROE powers as much as it could have during the period of bargaining, however, that appears to be due to difficulties with the Mural Room. My observation of the Mural Room is that it is not suitable for the purpose of bargaining discussions especially where, at the same time, employees need to also consume their meals which are often hot. It is not appropriate from a health and safety perspective that any employee should need to eat a hot meal while standing.

[561] The Training Room was not under consideration at the time of the inspection and there was no evidence about it. Consequently, the only observation as to its suitability which I am able to make is from the plans which are at Annexure How6 to Exhibit Cochlear 32. From a very rough comparison it appears to be about three times larger than the Mural Room and it has the same proximity to the nearby lunch area as that room. However, it suffers from the same problem as the Mural Room of being two to three minutes away from the main production areas. That period of time is important in the context of a 30 minute lunch break.

[562] I accept that there are production employees who may not wish to be involved in discussions with the AMWU. The evidence is that the main lunchroom is also used by non-production employees for whom this bargaining process is not relevant. Both of those factors are relevant in considering whether Cochlear has been unfair in refusing the AMWU access to the main lunchroom.

[563] The existence of two lunch areas goes both ways in considering this issue. Just as the second area could be used by employees who want to meet with the union, it could also be used by those who do not.

[564] All in all, I consider that Cochlear’s refusal of access to the lunchroom to be unfair conduct in contravention of section 228(1)(e).

[565] The next issue concerns Cochlear’s refusal at this time to seek DEEWR’s advice about its proposed dispute settlement procedure which is contained in the company’s April 2012 position. Two points are worth noting. First, the question is not whether the proposed clause meets any particular requirements of the Act. It is whether or not it complies with the Fair Work Principles. The answer will have a potential impact on Cochlear’s ability to continue to supply products under contract to the Commonwealth government. It will not of itself affect the issue of approval of any agreement under the Act. The second point is that Cochlear, and the other bargaining representatives, cannot be required to make concessions during bargaining or reach agreement on terms which are to be included in an agreement.

[566] I accept that Cochlear has taken its stance in relation to this issue as part of its bargaining strategy. However frustrating this may be it is not unfair or capricious conduct.

[567] I now turn to consider Mr Hargraves application. The question of whether or not the AMWU has acted in a manner which does not meet the good faith bargaining requirements largely rest on the status of the Protocols. If the Protocols are binding as submitted by Cochlear, the union’s actions in relation to them, especially its failure to renegotiate their terms and its unilateral withdrawal from them, would probably amount to capricious and unfair conduct undermining collective bargaining.

[568] I have carefully considered Cochlear’s submissions as to the effect of the Protocols. However, in my view, they do not amount to a binding contract between the parties but are merely administrative rules or arrangements which were supposed to assist in the bargaining process. I accept the evidence of Mr Ayres that, instead, the Protocols have become an impediment to bargaining.

[569] It is true that it was the AMWU which first proposed the idea of some type of bargaining protocol however, what was ultimately agreed upon was a very different document. On the face of it the Protocols were freely entered into by all parties although I note Mr Ayres’ evidence as to his hesitation to agree to them. Nevertheless, that does not mean that the Protocols should apply in perpetuity. I am satisfied that the union gave the Protocols a reasonable chance to succeed. It would be a different situation if the AMWU had withdrawn from the Protocols after only one or two meetings, however, bargaining took place under them for over a year during which there were ten bargaining meetings and a vast array of bargaining-related correspondence.

[570] Of course it is true that the AMWU could have sought to renegotiate the Protocols. However, in view of the length of time it took to agree upon the document in the first place, I share Mr Ayres’ pessimism about the value of any attempt to vary the Protocols.

[571] I am not satisfied that the AMWU’s conduct in withdrawing from the Protocols is action which contravenes section 228(1). It should be noted that, even if I had decided otherwise, I would not have exercised my discretion to issue the order sought by Mr Hargraves. The Protocols contain too many areas of potential disputation for them to be appropriate as an order of this Tribunal and, in my view, it would not be reasonable to make an order which imposed them.

[572] I recognise that in removing the Protocols from the bargaining process the parties will need to reach some accommodation about basic issues such as when and where they will meet and who will attend meetings. However I am sure that suitable arrangements will be made. If there are ongoing difficulties the parties can approach FWA for assistance.

[573] I now turn to consider whether I should make any bargaining orders, either in the form sought or otherwise. There is no issue that an application has been made and that a majority support determination is in operation. For the reasons set out earlier I am satisfied that the provisions of section 230(3) have been met. I am also satisfied that it is reasonable in all of the circumstances to make orders as indicated below.

[574] I am prepared to make Orders 1 and 2 as set out in paragraph 9 above.

[575] I do not consider that it would be reasonable to make Order 3. I have not found Cochlear’s refusal to agree to requests for paid meetings to be unfair. In the light of that conclusion and the absence of any history of paid meetings it would not be appropriate to make such an order especially for paid meetings on a regular monthly basis.

[576] Nevertheless I am concerned that it appears that the employees have been provided with very little information and feedback on the whole bargaining process. Although there is nothing at the moment on which the employees are required to cast a vote, I consider that there is a need for them to be informed and consulted. For that reason I recommend that Cochlear grant the AMWU one half hour paid meeting with employees on each shift to discuss collective bargaining. That meeting should be held within four weeks of the date of this decision. The company may wish to hold a similar meeting. It might be useful if an arrangement similar to that used prior to the MSD was adopted.

[577] I am prepared to make an amended version of Order 4. I have found that Cochlear’s refusal to allow the AMWU access to the lunchroom to be unfair conduct. However, I also recognise that there needs to be a balance between the union, its members and other employees who are prepared to participate in discussions, those employees who wish to enjoy their breaks free from unwanted interruption and Cochlear’s obligation to provide appropriate eating facilities.

[578] I intend to order access to the main lunchroom alternating with access to the Training Room. The first meeting under this regime will take place in the lunchroom. The undertaking proposed by the AMWU should provide some degree of comfort to Cochlear. The undertaking would only be relevant for meetings in the lunchroom.

[579] I am not prepared to make Order 5. I have not found that Cochlear’s conduct in relation to the DEEWR issue to be unfair or capricious. However I recommend that the company reconsider its position of not putting the proposed clause to DEEWR unless the union agrees to it.

[580] I do not intend to make Orders 6 or 7 as I do not consider that they would be appropriate at this time. Obviously if the parties have any issues arising from the Orders they are at liberty to apply generally.

COMMISSIONER

Appearances:

C Howell of Counsel with T McCauley of the “Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union” known as the Australian Manufacturing Workers’ Union (AMWU)

S Wood Senior Counsel, T Saunders of Counsel, with M Mead and P Salewicz of The Australian Industry Group

P Brown solicitor, for the two employee bargaining representatives.

Hearing details:

2012.
Sydney.
February 7,
March 19, 20, 21, 22, 23 and 30,
April 13, 18 and 30,
May 2, 3, 4, 7, 21 and 31,
July 9.

Inspections:

2012.
Sydney.
March 21.

Final written submissions:

2012
July 27.

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