| [2016] FWCFB 711 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.604 - Appeal of decisions
VICE PRESIDENT HATCHER |
|
Appeal against decision ([2016] FWC 464) and order (PR576370) of Vice President Watson at Melbourne on 22 January 2016 in matter number B2016/212.
Introduction and background
[1] On 30 June 2015 the Patrick Terminals Enterprise Agreement 2012, which covers the container terminals operated by Patrick Stevedores Holdings Pty Ltd (Patrick) at the ports of Brisbane, Port Botany, Melbourne and Fremantle, reached its nominal expiry date. In anticipation of this, negotiations for a new enterprise agreement began in about March 2015.
[2] There was a significant number of meetings between Patrick and the bargaining representative of Patrick’s employees, the Maritime Union of Australia (MUA), in an endeavour to reach a new agreement. The negotiations were divided into two parts: Part A dealt with issues common to all four terminals, and Part B were negotiations about issues specific to each port/terminal. From 9 April through to 11 December 2015, there were 29 Part A meetings. The Part B meetings for each of the four individual terminals were as follows:
[3] The state of play in relation to the Part B negotiations after these meetings was that in-principle agreement had been reached concerning Brisbane and Melbourne, only one issue remained unresolved in Fremantle, but major issues remained in Port Botany.
[4] On 18 September 2015 Patrick, with the consent of the MUA, made an application to a member of this Commission, Deputy President Booth, for her assistance to facilitate the conduct of the bargaining. The application stated the following:
“We are writing to seek your involvement in the negotiations currently occurring between Patrick Stevedores Holdings Pty Limited (Patrick), the Maritime Union of Australia (MUA) and Patrick Employees concerning a replacement to the Patrick Terminals Enterprise Agreement 2012 (EA) which reached its nominal expiry date on 30 June 2015.
Negotiations have been ongoing since approximately March this year. The parties have worked cooperatively and constructively to endeavour to reach agreement that provides sustainable benefits to employees.
At this stage, whilst good progress has been made and negotiations have continued to proceed in good faith, the parties have identified a number of issues which we foresee will be challenging to resolve. Collectively we believe that engaging with you to assist negotiations gives the parties the best opportunity to reach an outcome quickly, and in a manner that is supportive of the relationship going forward.
Given your involvement to date with the Patrick Bulk Port Services business in negotiating Patrick Bulk and General Enterprise Agreements, we believe that you are well placed to assist us in these negotiations. At this stage, the parties have agreed to further meetings in the week commencing 27 September 2015. Subject to you being able to assist us with these negotiations and your availability, we would ideally seek to have your involvement in some of the negotiations in that week.
We thank you for your consideration of our request and look forward to your response. If you need any further information I can be contacted on [telephone number deleted]. The MUA officials who have been involved in negotiations to date have been copied on this correspondence.”
[5] In matter NA2015/6, Deputy President Booth provided the requested assistance in the conduct of the negotiations. The Deputy President facilitated the last 12 Part A meetings from 30 September 2015 to 11 December 2015 and the Part B meetings at Port Botany on 28 September 2015 and 18 November 2015.
[6] On 30 November 2015 the MUA applied for an order for the holding of a ballot of employees to authorise the taking of protected industrial action. On 1 December 2015, subject only to one minor drafting alteration, Patrick informed the Commission that it did not oppose the making of the order sought by the MUA. On 2 December 2015 the protected action ballot order sought was made by Deputy President Booth in matter B2015/1665. 1 The result of the ballot conducted pursuant to the order, which was declared by the Australian Electoral Commission on 23 December 2015, was that employees voted to authorise the taking of various forms of industrial action including stoppages of work and bans. The first notice of industrial action was given on 28 December 2015, and the first instance of industrial action commenced on 6 January 2016.
[7] The industrial action which followed from then on consisted of, in summary, an indefinite and continuing ban on overtime and shift extensions at Port Botany commencing on 6 January 2016 and at Fremantle from 19 January 2016, and stoppages of work of varying durations at Brisbane, Port Botany, Melbourne and Fremantle on 18 and 19 January 2016. The MUA also gave notice that there would be additional stoppages of work at Brisbane and Melbourne on 25 January 2016 and at Port Botany on 26 and 27 January 2016.
[8] On 19 January 2016 Patrick applied to the Commission for an order that protected industrial action being engaged in by its employees at the four container terminals for whom the MUA was the bargaining representative be suspended for a period of 60 days (Application). The Application was made pursuant to s.425 of the Fair Work Act 2009 (FW Act), which provides:
425 FWC must suspend protected industrial action—cooling off
(1) The FWC must make an order suspending protected industrial action for a proposed enterprise agreement that is being engaged in if the FWC is satisfied that the suspension is appropriate taking into account the following matters:
(a) whether the suspension would be beneficial to the bargaining representatives for the agreement because it would assist in resolving the matters at issue;
(b) the duration of the protected industrial action;
(c) whether the suspension would be contrary to the public interest or inconsistent with the objects of this Act;
(d) any other matters that the FWC considers relevant.
(2) The FWC may make the order only on application by:
(a) a bargaining representative for the agreement; or
(b) a person prescribed by the regulations.
[9] The Application was opposed by the MUA, and accordingly a hearing of the application occurred on 21 January 2016 before Vice President Watson. On 22 January 2016 he issued a decision 2 (Decision) in the following terms:
“[1] This decision concerns an application by Patrick Stevedores Holdings Pty Ltd (Patrick) for an order under s.425 of the Fair Work Act 2009 (the Act) that protected industrial action that is being engaged in by employees of Patrick who are members of The Maritime Union of Australia (MUA) be suspended.
[2] I am satisfied that suspension of the protected industrial action is appropriate taking into account the matters specified in s.425 of the Act. I determine that the suspension will be for a period of 35 days from the date of this decision.
[3] Full reasons for my decision in this matter will be issued in due course.”
[10] Accompanying the Decision, the following order 3 (Order) was issued on the same day:
“A. Further to the decision issued in [2016] FWC 464, and pursuant to s.425 of the Fair Work Act 2009, the Fair Work Commission orders as follows:
1. Protected industrial action being engaged in by employees of Patrick Stevedores Holdings Pty Ltd (Patrick):
is suspended for a period of 35 days from the date of this order.
B. This order will take effect from 22 January 2016.”
[11] On 25 January 2016 the MUA lodged a notice of appeal in which it sought permission to appeal and appealed the Decision and Order.
[12] On 29 January 2016 the reasons for the Decision 4 (Reasons) were issued by Vice President Watson.
Reasons for Decision
[13] After outlining the history of bargaining and protected industrial action, the Reasons dealt with an argument advanced by the MUA that, on the proper construction of s.425, regard could only be had to protected industrial action which was being engaged in at the time that an application under the section was being considered, that it was only that industrial action which was capable of being subject to a suspension order, and accordingly that in considering the appropriateness of suspension, the consideration was confined to the appropriateness of suspension of the particular action being engaged in at the time. This argument was opposed by Patrick and rejected by Vice President Watson in the Reasons. It was concluded that engagement in any protected industrial action provided the “jurisdictional trigger” for the making of an order that suspended all protected industrial action, and that the consideration of the appropriateness of suspension needed to have regard to protected industrial action that was both happening and impending. 5
[14] The Reasons then dealt with the matters required to be taken into account under s.425(1). In relation to whether the suspension would be beneficial to the bargaining representatives because it would assist in resolving the matters at issue (s.425(1)(a)), the Reasons focused upon an exchange of correspondence between Patrick and the MUA which took place on 14 January 2016. This correspondence was set out in full in the Reasons. The first was a letter from Mr Anthony Jones, the General Manager of Patrick’s NSW/Queensland operations, to Mr Will Tracey, the Deputy National Secretary of the MUA. The letter, as reproduced in the Reasons, read as follows:
“I am writing in relation to the ongoing negotiations for the proposed enterprise agreement to replace the Patrick Terminals Enterprise Agreement 2012.
As you know, the parties have been engaged in extensive discussions facilitated by Deputy President Anna Booth of the Fair Work Commission. Many claims have been raised and discussed. The company has found the involvement of Deputy President Booth to be of assistance in the process, and we believe that the discussions in 2015 were constructive and saw the parties moving towards reaching agreement. The process is ongoing, and there are a number of issues which remain unresolved. These include claims dealing with matters that include:
These matters, along with others, are the subject of ongoing discussion and negotiation between the parties, with the assistance of Deputy President Booth. Some matters are yet to even be discussed in any meaningful way by the parties, such as the most recent position put forward by the union for rostering at Port Botany.
The company believes that there is significant further negotiation which is required, and that there is scope for compromise by both sides on a number of matters. The company is prepared to continue to seek agreement with the assistance of Deputy President Booth, and is open to more formal conciliation and, if necessary, arbitration to resolve all matters.
Against this background, the company was disappointed that the union decided to seek a protected action ballot order while constructive discussions were ongoing, and disappointed again to receive notification of a range of stoppages and bans. Indeed, these are to take place at times when the negotiating teams are due to meet on 20th, 21st and 22nd January 2016. This does little to assist the parties to reach an agreement.
The company views the proposed industrial action as entirely premature in the circumstances, and believes that the parties should instead focus on the negotiations and seeking to reach an outcome in the near term. For this reason, we invite the union to withdraw all notices of protected industrial action and undertake not to provide further notices while negotiations are continuing. The company believes that this would be beneficial to the parties because it would assist in resolving the matters in dispute.
As you know, the parties some time ago agreed to meet on 20th, 21st and 22nd January 2016. Deputy President Booth was not scheduled to attend these meetings, but only because she is unavailable for them. Given the recent escalation of matters, and the constructive nature of the earlier discussions chaired by her, the company believes that the meetings next week should be rescheduled to the earliest possible occasion on which Deputy President Booth is available. We will seek her available dates and be in touch to confirm arrangements.
[15] Mr Tracey’s reply email, as reproduced in the Reasons, was as follows:
“I’ll keep the reply as short as I possibly can.
I don't have anything to say about your inaccurate summary of the negotiations to date suffice to say that it isn't reflected in the ongoing minutes and you haven't been at the discussions.
Patrick and your views on the PABO and notified action are noted. Neither should come as a surprise to Patrick because we informed the company at our last meeting prior to Christmas, in front of DP Booth, that we were going to do this unless we saw some meaningful movement from Patrick. Your correspondence prior to Christmas and actions prior and since have caused this current set of circumstances to occur. We will not be withdrawing the action and if Patrick refuses to meet next week we will escalate the action until you do meet. We have 3 days to meet next week to try and get a resolution to the agreement or at the very least a decent view of it- we are aware of the issues and they can be resolved without the presence of DP Booth although like you we acknowledge the very positive influence she had on the negotiations so far.
While we remain committed to the ongoing process before DP Booth, and understand the benefits to date, we will not consent under any circumstances to arbitration of the agreement.
The reality is we have seen very little movement from Patrick on some of our key issues, many of which you have clearly outlined, and we have been going at this for close to 12 months. Please confirm you will meet next week because we need to be absolutely clear that a refusal to meet will result in an escalation of the action. At the very least we will be able to close the gap on some matters and clarify for our next meeting with DP Booth what assistance we need and on what issues. In respect of your recent site correspondence I have cancelled my last week of leave to attend next week's meetings. We have already paid for airfares and accommodation for those attending.
One other point we wish to express is our anger and disgust at the opportunistic email correspondence your management in Fremantle has sent to Kim MacDonald from the West Australian seeking to link our action to the tragic and unfortunate situation of the South West bushfires. To misrepresent the impact of the action in this manner hoping to chase a headline is reprehensible behaviour and will get an appropriate response at an appropriate time - your Fremantle management has seriously miscalculated this tactic and the views of our membership in this Port. Our membership and Union have been contributing financially to the Union fund set up for assistance to those affected by these fires with many helping to actually fight the fires. This disgraceful behaviour of your Fremantle management is condemned by this Union and its members in the strongest possible terms.”
[16] The Reasons then stated the following conclusions about this exchange:
“[25] It appears from this correspondence that cancellation of meetings in preference to facilitated discussions by Deputy President Booth is a major factor in the escalation of industrial action. The industrial action reflects a deterioration in the negotiation process at a time when the assistance of Deputy President Booth was not available. Deputy President Booth had advised the parties that the week of 1 February 2016 is available for further facilitation of the negotiations. Whatever else may be said about the communications between the parties on 14 January, at least the parties appear to be agreed on the need for discussions aimed at bridging the gap between them.”
[17] Reference was then made to the evidence of Mr Jones, which was characterised as demonstrating that the occurrence of industrial action, including the bans, made it “difficult for Patrick managers to make the time available to attend bargaining meetings before, during and after industrial action” because it required them to go into “firefighting mode” which did not enable “other time consuming and difficult processes to be given necessary attention”. 6 The following critical conclusions were then stated (emphasis added):
“[28] Mr Jones gave evidence that the MUA provided Patrick with a “settlement document” on 6 January 2016 and several notices of industrial action on 8 January 2016. Mr Jones states that the document requires discussion between the parties. That discussion has not occurred. The MUA states that this is because of the cancellation of meetings planned for the week of 18 January. Patrick states that the protected industrial action has hindered the process. I make no finding as to the fault of any party. However it is clear that the elevation of hostilities between the parties has precluded the processes of discussion and negotiation. The negotiations have advanced satisfactorily at some locations. At the Sydney terminal and at the Part A level there appears to be a need for considerable additional effort of the parties. On the evidence before me compromise on some of the issues is likely. The involvement of the Commission is also likely to be of assistance.”
[18] Reference was then made to the “disruption of services to third parties” as a “relevant contextual consideration” 7, and the conclusion was stated that “I do not consider that suspension undermines the claims or the bargaining position of the MUA or deprives it of the ability to support its claims with industrial action in the future.”8 The following conclusion was then stated in relation to s.425(1)(a):
“[31] In all of the circumstances I am of the view that suspension of the protected industrial action would assist the bargaining representatives resolve the matters at issue. Provided the suspension is sufficient to enable proper discussion and consideration of revised positions and for the parties to access the assistance of Deputy President Booth I am of the view that suspension will assist in the relevant way. Because of the above considerations however, it would not be appropriate to suspend protected industrial action for a lengthy period. I have reached this conclusion on the basis of the current and pending industrial action. However I would reach the same conclusion if considering only the current industrial action.”
[19] In relation to the duration of the protected industrial action (s.425(1)(b)), the Reasons summarised the protected industrial action which had occurred and then stated (emphasis added):
“[32] … Despite the disruptive nature of this industrial action there does not appear to have been any concessions by Patrick in response to the industrial action. Indeed the cancellation of meetings appears to represent some hardening of Patrick’s position. If only current industrial action is considered, the pending escalation would need to be disregarded.”
[20] As to whether suspension would be contrary to the public interest or the objects of the FW Act (s.425(1)(c)), the conclusion stated was that suspension would be consistent with the public interest and the object of the FW Act. 9 The Reasons were silent as to whether any other matter was considered relevant for the purpose of s.425(1)(d). The following overall conclusions were then stated:
“[35] Taking into account all of the circumstances and in particular the factors outlined above I decided to suspend protected industrial action because I was satisfied that suspension is appropriate. In coming to this assessment I considered that the suspension would be beneficial to the bargaining representatives because it would assist in resolving matters in dispute. I have considered the nature and duration of the industrial action. I am not satisfied that suspension is contrary to the public interest or the Object of the Act. Indeed suspension is consistent with the Object and the public interest. I have considered all other relevant circumstances raised by the parties in the evidence and submissions before me.
[36] The matters I am required to take into account point strongly towards the appropriateness of suspension. Even if the pending 24 hour stoppages were removed from consideration I would reach the same conclusion. I am therefore of the view that suspension is appropriate. As I am satisfied that suspension is appropriate I am required by the terms of s.425 to make an order suspending protected action.
[37] I consider that suspension for 35 days will enable detailed consideration before Deputy President Booth over the ensuing weeks and not deprive the parties of their options for the future. An order giving effect to my decision was issued on 22 January in conjunction with my decision in the matter.”
Submissions
[21] The MUA submitted that the Order was invalid because it did not specify the particular protected industrial action which was suspended. One of the jurisdictional prerequisites for the making of a suspension order under s.425(1) was that protected industrial action was “being engaged in”, and it was only that protected industrial action which was found to be “being engaged in” which could be suspended by an order. The evidence was, the MUA submitted, that the only protected industrial action actually being engaged in at the time of the hearing and the Decision were the bans on overtime and shift extensions at Port Botany and Fremantle, and if there was satisfaction that suspension was appropriate, the order that was made should have been confined in its terms to suspension of those bans only. Because the Order suspended protected industrial action generally, it went beyond the power conferred by s.425(1).
[22] The MUA also submitted that there was error in the conclusion that the suspension of protected industrial action was appropriate. It particularised its contention of error in this respect as follows:
(1) The finding that cancellation of meetings in preference to facilitated discussions by Deputy President Booth was a major factor in the escalation of the industrial action (paragraph [25] first sentence) mistook the facts.
(2) The Reasons ignored the relevant consideration that Patrick had suggested that the meetings be rescheduled as a result of the escalation of the industrial action.
(3) The Reasons ignored the relevant consideration that Patrick, with knowledge that planned industrial action was not being withdrawn, had proposed on 15 January 2016 a high level meeting presided over by Deputy President Booth in substitution for the previously scheduled meetings.
(4) The Reasons ignored the relevant consideration that the protected industrial action had resulted in the substitution for the previously scheduled meetings of a high level meeting presided over by Deputy President Booth.
(5) The Reasons disclosed error in relying on the conclusion of Mr Jones that it was difficult for Patrick managers to make the time available to attend bargaining meetings (paragraph [27] fifth sentence), which was not open on the evidence.
(6) The conclusion of Mr Jones that it was difficult for Patrick managers to make the time available to attend bargaining meetings (paragraph [27] fifth sentence) was an irrelevant consideration.
(7) The Reasons ignored the relevant consideration that no Patrick managers were unable to make the time available to attend bargaining meetings.
(8) The finding that the MUA stated that the discussion of the “settlement document” had not occurred because of cancellation of meetings (paragraph [28] fourth sentence) mistook the facts.
(9) The findings linking the “settlement document” with the cancellation of meetings (at paragraph [28]) mistook the facts.
(10) The finding that the elevation of hostilities between the parties had precluded the processes of discussion and negotiations (paragraph [28] seventh sentence) mistook the facts and was not open on the evidence.
(11) The finding that there appears to be a need for considerable additional effort of the parties (paragraph [28] ninth sentence) was an irrelevant consideration in that it could take place while protected action was permitted.
(12) The finding that compromise on some of the issues was likely (paragraph [28] tenth sentence) was an irrelevant consideration in that it could take place while protected action was permitted.
(13) The finding that the involvement of the Commission was likely to be of assistance (paragraph [28] eleventh sentence) was an irrelevant consideration in that it could take place while protected action was permitted.
(14) The Reasons failed to take into account the relevant consideration that Patrick had conceded that it would continue talking to the appellant even if protected industrial action was occurring.
(15) If meetings were cancelled, the Reasons erred in taking any account of such cancellation which was a choice made by the respondent.
(16) The Reasons disclosed error in taking into account at all (at paragraph [29]) the nature of the industry, the importance of the respondent to an important aspect of the Australian economy and the disruption of services to third parties.
(17) The Reasons fundamentally misconceived the effect of the suspension on the MUA’s bargaining position in finding (at paragraph [30]) that it would not be undermined by the suspension.
(18) The ultimate conclusion that suspension of the protected industrial action would assist the bargaining representatives to resolve the matters at issue (paragraph [31] second sentence) was erroneous in that it was based on the erroneous analysis of the circumstances as set out in particulars (1) to (17) above.
(19) The ultimate finding that suspension had to be sufficient to enable proper discussion and consideration of revised positions and for the parties to access the assistance of Deputy President Booth (paragraph [31] second sentence) referred to irrelevant considerations in that it could take place while protected action was permitted.
(20) The Reasons disclosed error in the finding that the objective of cooperative and productive workplace relations suggests an emphasis on negotiation and exhaustive attempts to reach agreement (paragraph [34] first sentence).
(21) An emphasis on negotiation and exhaustive attempts to reach agreement (paragraph [34] first sentence) was an irrelevant consideration in that it could take place while protected action was permitted.
(22) The Reasons disclosed error in considering and finding that suspension was positively consistent with the public interest and the object of the FW Act (paragraph [34] fifth sentence).
[23] The MUA also submitted that the facts of the case demonstrated that the Decision and the making of the Order were unreasonable and/or plainly unjust.
[24] Patrick submitted that, on the proper interpretation of s.425(1), the power conferred was to suspend the protection or immunity from suit afforded by s.415 in relation to all industrial action. An order under s.425 did not and could not operate to suspend industrial action, but it did have the consequence that industrial action that occurred during the period of suspension would be rendered non-protected and therefore subject to ss.418, 420 and 422 of the FW Act as well as any other action under State or Territory law. The interpretation advanced by the MUA, Patrick submitted, was a narrow one which would defeat the cooling off purpose of s.425. It was not in dispute that there was protected industrial action being engaged in and accordingly, once there was satisfaction that suspension would be appropriate, the order that was required to be made was that all protected industrial action was suspended. The Order was consistent with this requirement and was valid.
[25] In respect of the question of the appropriateness of suspension, Patrick emphasised that the decision-maker was required to exercise a broad discretionary judgment involving a considerable degree of latitude as to the decision to be made. In relation to the specific instances of error identified by the MUA, Patrick submitted:
Consideration
Validity of the Order
[26] We reject the MUA’s submission that the Order was invalid because it did not identify the specific industrial action which was “being engaged in” and was thereby suspended by the Order. That submission was founded upon an interpretation of s.425(1) that we likewise reject, namely that the duty to make an order suspending protected industrial action where such a suspension is appropriate is confined to suspension of the particular protected industrial action which is identified as being engaged in at the time a decision is made under s.425(1).
[27] While the MUA’s interpretation of s.425(1) is one that may be available on the language of the provision, a range of contextual considerations strongly indicate that it does not accord with the meaning of the provision intended by the legislature. We consider that the correct interpretation of s.425(1) is that the purpose and effect of any order required to be made under the provision is to suspend the protection or immunity attaching to any industrial action authorised to be taken by a protected action ballot.
[28] The strongest indicator of this is s.413(7). Section 413(1) states that “This section sets out the common requirements for industrial action to be protected industrial action for a proposed enterprise agreement”. Section 413(7), which is therefore one of those requirements, relevantly provides:
No suspension or termination order is in operation etc.
(7) None of the following must be in operation:
(a) an order under Division 6 of this Part suspending or terminating industrial action in relation to the agreement;
(b) …
(c) …
[29] An order made under s.425 is one made under Division 6 of “this Part” (Part 3-3). The effect of s.413(7) therefore is that once an order is made under s.425 and while it remains in effect, any industrial action would not be protected industrial action. The interpretation advanced by the MUA would set up an incongruity between the terms of the suspension order and the effect of s.413(7), in that the suspension order would be confined to the particular type of industrial action being engaged in at the time, but s.413(7) would in any event render any industrial action non-protected. An interpretation of s.425 by which a suspension order has the effect of suspending the protection attaching to any industrial action would, in contrast, be harmonious with s.413(7).
[30] The MUA’s interpretation of s.425 would also not be consistent with its evident purpose to allow a “cooling off” period in the course of enterprise bargaining in order to advance the prospects of resolving the matters in issue. If a suspension order was confined in its effect to a particular type of protected industrial action taken at a particular time, that would imply that other types of protected industrial action could be taken during the cooling off period established by the order. That would appear likely to frustrate the objective of the provision, and it again raises the issue of inconsistency with s.413(7).
[31] That a s.425(1) order operates to suspend generally the protection attaching to industrial action, and not to prohibit the taking of specific types of industrial action, is apparent from the fact that the FW Act does not prohibit the taking of industrial action while a suspension order is in operation or provide for court enforcement of any suspension order under Part 4-1. This is consistent with the FW Act’s scheme concerning industrial action under which the taking of industrial action after the nominal expiry date of an enterprise agreement has passed is not rendered unlawful. The critical effect of the making of a suspension order is that, by suspending the protection or immunity conferred by s.415, any industrial action which is then taken becomes amenable to an order under s.418 and to any other remedies which may be available at law.
[32] That the interpretation we prefer is consistent with the intention of the legislature is confirmed by relevant parts of the Explanatory Memorandum for the Fair Work Bill 2009. In relation to Division 6 of Part 3-3 generally, the Explanatory Memorandum relevantly stated (underlining added):
“Division 6 – Suspension or termination of protected industrial action by FWA
1706. Division 6 sets out the grounds upon which FWA may suspend or terminate protected industrial action organised, or engaged in, in relation to a proposed enterprise agreement.
1707. Suspension or termination of protected industrial action brings to an end the right to take protected industrial action. Protected industrial action may be resumed after any period of suspension, but will be subject to any requirements for the giving of notice before any action may be taken. A termination of protected industrial action may lead to FWA making a workplace determination under Part 2-5.”
[33] In relation to s.425 specifically, the Explanatory Memorandum said (underlining added):
“Clause 425 – FWA must suspend protected industrial action – cooling off
1723. This clause enables FWA to suspend the taking of protected industrial action to provide for a cooling-off period. Protected industrial action cannot be terminated on this ground.
1724. FWA is required to make an order suspending protected industrial action if it is satisfied that it would be appropriate to do so taking into account the following matters (subclause 425(1)):
• whether suspension would assist the bargaining representatives to resolve the matters at issue;
• the duration of the protected industrial action;
• the public interest and the objects of the Act; and
• any other relevant matters.”
[34] The interpretation we prefer is also consistent with the Full Bench decision in National Tertiary Education Industry Union v University of South Australia. 10 That decision concerned the effect of a suspension or termination order made under s.424(1) of the FW Act, which provides:
Suspension or termination of protected industrial action
(1) The FWC must make an order suspending or terminating protected industrial action for a proposed enterprise agreement that:
(a) is being engaged in; or
(b) is threatened, impending or probable;
if the FWC is satisfied that the protected industrial action has threatened, is threatening, or would threaten:
(c) to endanger the life, the personal safety or health, or the welfare, of the population or of part of it; or
(d) to cause significant damage to the Australian economy or an important part of it.
[35] In relation to an argument that such an order only operated with respect to protected industrial action which was found to threaten the effects identified in paragraphs (c) and (d) of s.424(1), the Full Bench said:
“[10] In the present case, it was submitted by the NTEU that the power in s.424 of the Act is significantly different from that relating to the termination of bargaining periods under the WR Act. It was said that the power in s.424 is a much more confined and precise power which is directed at the prevention of particular forms of third party harm. It is therefore only industrial action which causes the requisite harm that may be terminated or suspended by FWA under s.424 of the Act.
[11] We do not agree with this construction of the power in s.424. The use of the words “suspension” and “termination” of protected industrial action in the section may be contrasted with the power given to FWA in s.418 in relation to the making of orders to “stop” industrial action. The suspension of protected industrial action is to be construed as a suspension of the protection or immunity which attaches to the industrial action under the Act provided it is authorised in a protected action ballot etc. (see s.409). A reference in s.424 to the making of an order “suspending or terminating protected industrial action for a proposed enterprise agreement” would therefore seem to apply to protected industrial action which was authorised by the ballot, and not to the particular industrial action which is being taken as part of what might be a series of actions authorised by the ballot and which is having the requisite harmful effect.
[12] This reading of s.424 would accord with the wider scheme of the Act and, in particular, with the provisions which apply to the making of workplace determinations where an order has been made terminating protected industrial action (see s.266). It would be inconsistent with that scheme if further protected industrial action was able to be taken even though the jurisdiction for the making of an arbitrated determination was in train (see Ambulance Victoria v LHMU [2009] FWA 44, Kaufman SDP). There is no valid reason for adopting a fundamentally different interpretation of s.424 in respect of the power to suspend protected industrial action than is applied in relation to the termination power.
[13] In any event, we note that even if an order made under s.424 was confined to part only of the authorised industrial action, the effect of the order would be to render other industrial action unprotected. The common requirements that apply for industrial action to be protected industrial action are set out in Subdivision B of Division 2 of Part 3-3 of the Act. In particular, s.413(7)(a) provides that industrial action will not be protected industrial action for a proposed enterprise agreement if there is in operation “an order under Division 6 of this Part suspending or terminating industrial action in relation to the agreement”.
[14] We are therefore of the view that the approach adopted by the Senior Deputy President, in so far it relates to the making of an order suspending all the industrial action authorised by the protected action ballot, was in accord with the scheme of the Act.”
[36] We see no reason why a different approach should be taken to s.425.
[37] We consider that, on the proper interpretation of s.425(1), once it is found that protected industrial action is being engaged in and a state of satisfaction is reached that suspension of protected industrial action is appropriate, the order that is required to be made is one which suspends, for the duration of the order, the protection attaching to any industrial action. There was no dispute that industrial action, at least in the form of the bans at Port Botany and Fremantle, was being engaged in at the time of the hearing before Vice President Watson and at the time the Decision and Order were issued. Subject to there being no error in the formation of the view that suspension was appropriate, we consider that the Order was one which conformed to the requirements of s.425(1).
Appropriateness of suspension
[38] Under s.425(1), the Commission is required to make an order suspending protected industrial action if satisfied that the suspension is appropriate taking into account the four specified matters. In the High Court decision in Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission 11, reference was made to a decision-making process whereby “the decision-maker is required to make a particular decision if he or she forms a particular opinion or value judgment” as constituting an example of discretionary decision-making where the latitude allowed to the decision-maker as to the choice of the decision to be made was “quite narrow”.12 The decision-making process required by s.425 of the FW Act clearly fits this description. As was established in Coal and Allied13, in an appeal from a decision of this nature it is necessary for the appellant to establish error in the decision-making process of the type described in House v The King14, namely that the decision-maker has acted on a wrong principle, has been guided or affected by extraneous or irrelevant factors, has mistaken the facts, or has failed to take into account some material consideration. Therefore it is necessary for the MUA, insofar as it challenges Vice President Watson’s conclusion that the suspension of protected industrial action was appropriate, to demonstrate error of this nature.
[39] We have earlier set out the appealable errors for which the MUA contends in this connection. It is not necessary for us to give consideration to all of the matters raised by the MUA because we are satisfied that the Reasons disclose errors of fact in the consideration under s.425(1)(a) as to whether suspension would be beneficial to the bargaining representatives because it would assist in resolving the matters at issue. Those errors are, we consider, of sufficient significance to vitiate the conclusion that the suspension would be beneficial to the bargaining representatives and thus the entire assessment of whether suspension was appropriate.
[40] We have earlier set out or summarised the consideration under s.425(1)(a) in the Reasons. The Reasons disclose that the critical factual conclusion reached was that the “elevation of hostilities” between the parties had “precluded the processes of discussion and negotiation” 15 (emphasis added). We consider that this factual conclusion was unsustainable on the evidence and was, with respect, plainly wrong. We have reached this conclusion for four reasons.
[41] First, the Reasons disclose a misapprehension as to what occurred in the exchange of correspondence on 14 January 2016. In its letter, Patrick sought that the three days of negotiations between the parties which had been previously arranged to take place on 20, 21 and 22 January 2016 should be rescheduled to a later time when Deputy President Booth was available to facilitate the process. In its reply, the MUA opposed this suggestion, and threatened further industrial action if the meetings did not proceed as planned. This was described in the Reasons as a “cancellation” by Patrick of the meetings 16, but there is nothing in the correspondence or in the evidence to support the proposition that the meetings were ever actually cancelled by Patrick. Patrick did no more than advance a proposal for a rescheduling of the meetings based on a preference that Deputy President Booth be in attendance. Thus there could be no basis to conclude that anything in the correspondence of 14 January 2016 demonstrated any preclusion to the continuation of discussions and negotiations.
[42] Second, the Reasons disclose that Vice President Watson failed to take into account further correspondence between Patrick and the MUA on the following day, 15 January 2016. The MUA issued further notices of industrial action on 15 January 2016, with such industrial action to occur on 25 and 26 January 2016. The references in the Reasons to “the escalation of industrial action” and “the elevation of hostilities” appear to relate to these notices. But there was email correspondence from Mr Jones on behalf of Patrick to Mr Tracey of the MUA at 1.54pm on 15 January 2016 which demonstrated that notwithstanding this the issue concerning the scheduling of the meetings had in fact been resolved in high-level discussions between the parties. The email read as follows:
“Thank you for getting back to me on my letter of 14 January 2016 and I note your confirmation that you will not be withdrawing the planned industrial action.
I am encouraged that you also believe that the involvement of DP Booth has been a positive influence. While we appreciate your desire to proceed with the planned negotiation dates next week, we remain of the view that the most constructive progress will be made with DP Booth’s involvement. It would be disappointing if you elected to escalate industrial action as a result of this request to reschedule and clearly we do not believe this does anything to help the parties reach agreement.
As I believe you are aware, following recent discussions with Paddy Crumlin and John Mullen it is proposed, and DP Booth has agreed to make herself available on one day next week, to have a high level meeting of senior representatives from both our organisations.
The purpose of the meeting would be to discuss how we believe we can get negotiations back on track and make commitments to invest the required time to continue negotiations on DP Booth’s return from leave. The suggestion is that we would commit a full week if needed during the week commencing 1 February 2016 to progress negotiations with our respective bargaining teams.
The proposed group to meet for the high level discussion next week would be John Mullen, Murray Vitlich and myself from Asciano. I would appreciate it if you can confirm your willingness to attend this meeting and the proposed attendees to represent the MUA. Based on discussions with Paddy Crumlin, I understand this is likely to be Paddy Crumlin, Dave Cushion and yourself. We are committed to this meeting and would seek confirmation of which would be the most suitable date from the 18, 19 or 20th of January to do so.”
[43] Mr Jones’ characterised the understanding recorded in the above email as a “joint decision” to escalate the negotiations to a higher level. 17 He further gave evidence that this agreed “high level meeting” was scheduled for 22 January 2016, and that Deputy President Booth had agreed to return from leave to facilitate the meeting. He also gave evidence that, consistent with the week of negotiations commencing 1 February 2016 foreshadowed in the email, the Deputy President was available for the whole of that week to work with Patrick and the MUA. There is no dispute that the “high level meeting” scheduled for 22 January 2016 actually proceeded (noting that was the day upon which the Decision and Order were issued).
[44] Although Patrick in its letter of 14 January 2016 stated a preference for industrial action not to proceed during further negotiations, which preference was confirmed in Mr Jones’ evidence, there was nothing in the evidence to suggest that Patrick’s participation in future negotiations was conditional upon a cessation of industrial action. Patrick’s email of 15 January 2015 expressly acknowledged that the MUA would not be withdrawing its planned industrial action but nonetheless communicated agreement as to future dates for meetings. Mr Jones confirmed in his evidence that Patrick’s policy in the current bargaining round was to continue to be willing to meet with the MUA notwithstanding the occurrence of protected industrial action. Additionally, it was an agreed fact in the appeal that the issuing of the additional notices of protected industrial action on 15 January by the MUA actually occurred after the agreement recorded in Patrick’s email of that day to hold the high level meeting, but this did not prevent the meeting proceeding as agreed.
[45] Thus, far from the industrial action precluding discussion and negotiations, the parties had expressly agreed for further negotiations to occur with the assistance of Deputy President Booth notwithstanding that it was known that such industrial action would continue.
[46] Third, paragraph [28] of the Reasons, which we have earlier set out in full, discloses that the conclusion that discussions and negotiations were precluded was based significantly if not wholly upon the proposition that there had been no discussions about the “settlement document” provided by the MUA to Patrick on 6 January 2016, and that the MUA blamed Patrick for this because of the “cancellation” of the meetings on 20, 21 and 22 January 2016 and Patrick said discussions had been hindered due to the industrial action. That proposition mistook the relevant facts entirely.
[47] The “settlement document” referred to was a modified proposal advanced by the MUA in relation to the Part B negotiations for Port Botany. It was not in dispute that the meetings scheduled for 20, 21 and 22 January 2016 were for the purpose of the Part A negotiations only, so that there was never any intention on either side to discuss the “settlement document” at those meetings. The rescheduling of those meetings proposed by Patrick on 14 January 2016 therefore had no relevance to future discussions about the “settlement document”. In the appeal the MUA stated, without contradiction from Patrick, that it had never submitted at first instance that it blamed the fact there had been no discussions about the “settlement document” on Patrick’s letter of 14 January 2016. For its part, Patrick properly conceded that there was no evidence that the protected industrial action was the reason why there had been no discussions about the “settlement document”. 18 In fact the last Part B meeting for Port Botany had occurred approximately one month before protected industrial action commenced, and the evidence did not (as Patrick conceded19) disclose the reason why there had not been any further Part B Port Botany meetings prior to the commencement of protected industrial action.
[48] Patrick submitted that the high level meetings agreed in the 15 January 2016 email were not necessarily confined to Level A issues and that it was open for the parties to discuss outstanding Part B issues, including the “settlement document”, at those meetings. That may, on the evidence, be accepted. However that demonstrates that, far from the protected industrial action precluding discussions about the “settlement document”, the parties had agreed upon a process that allowed such discussions to occur notwithstanding the continuance of protected industrial action.
[49] Fourth, although the evidence of Mr Jones undoubtedly established that the continuance of protected industrial action created difficulties in terms of managerial attendance at bargaining meetings, the evidence did not establish that these difficulties were such as to preclude attendance. Indeed, the evidence clearly established that, notwithstanding these difficulties, the relevant managers were available to attend meetings. Patrick’s letter of 14 January 2016 contained no suggestion that its desire to reschedule the meetings planned for 20, 21 and 22 January 2016 had anything to do with the unavailability of relevant managers to attend meetings, and Patrick’s email of 15 January 2016 committed its senior representatives to attendance at a meeting on 22 January 2016 and a week of foreshadowed meetings starting on 1 February 2016.
[50] The benefit of suspension identified in the Reasons was “to enable proper discussion and consideration of revised positions and for the parties to access the assistance of Deputy President Booth”. 20 The identification of that benefit was based on the proposition that this would not occur without a suspension because the “elevation of hostilities” in the form of protected industrial action precluded such discussions and consideration from occurring. However for the reasons we have stated it is clear that such discussions and consideration involving Deputy President Booth were to proceed irrespective of the continuation of the protected industrial action. The evidence provided no foundation for the existence of the identified benefit. This, we consider, caused the exercise of the discretion to miscarry.
[51] It is not necessary therefore to consider the other aspects of the Reasons challenged in the MUA’s submissions. It is sufficient to observe that the misapprehension as to the facts concerning the correspondence of 14 January 2016 extended into Vice President Watson’s consideration of the duration of the protected industrial action for the purpose of s.425(1)(b), in that in this section of the Reasons reference was erroneously made to “the cancellation of meetings appear[ing] to represent some hardening of Patrick’s position”. 21 For the reasons stated, there was no cancellation by Patrick of any meetings, nor did it harden its position.
Conclusion and orders
[52] For the reasons stated above, we consider that the Decision and Order were attended by appealable error such that the exercise of the discretion involved in assessing the appropriateness of suspension of protected industrial action miscarried. This justifies the grant of permission to appeal, and requires the appeal to be upheld.
[53] It will consequently be necessary for the Application made by Patrick under s.425 to be re-determined. We propose to undertake that task ourselves. Because the application needs to be re-determined by reference to the circumstances existing at the time of re-determination, it will further be necessary to provide the parties with an opportunity to adduce further evidence and make submissions concerning events which have occurred since the hearing on 21 January 2016.
[54] We make the following orders and directions:
(1) Permission to appeal is granted.
(2) The appeal is upheld.
(3) The Decision and Order are quashed.
(4) The Application is listed for a telephone directions hearing before Vice President Hatcher at 5.00pm AEDT on Tuesday 9 February 2016.
VICE PRESIDENT
Appearances:
S. Crawshaw SC with A. Jacka for the Maritime Union of Australia.
H. J. Dixon SC with D. J. A. Mackay of counsel for Patrick Stevedores Holdings Pty Ltd.
Hearing details:
2016.
Sydney:
2 February.
5 Reasons at [15]-[20]
6 Reasons at [27]
7 Reasons at [29]
8 Reasons at [30]
9 Reasons at [34]
10 [2010] FWAFB 1014, (2010) 194 IR 30
11 (2000) 203 CLR 194
12 Ibid at [19] per Gleeson CJ and Gaudron and Hayne JJ
13 Ibid at [21] per Gleeson CJ and Gaudron and Hayne JJ
14 (1936) 55 CLR 499
15 Reasons at [28]
16 Reasons at [25], [28] and [32]
17 Transcript 21 January 2016, PN522
18 Appeal transcript PNs 584-585
19 Appeal transcript PNs 600-601
20 Reasons at [31]
21 Reasons at [32]
Printed by authority of the Commonwealth Government Printer
<Price code C, PR576683>