DECISION

Fair Work Act 2009
s.604 - Appeal of decisions

Australian and International Pilots Association
v
Australian Federation of Air Pilots & Transport Workers' Union of Australia
(C2021/1156)

Appeal against decision [2021] FWC 1012 of Deputy President Saunders at Newcastle on 24 February 2021 in matter number D2019/5.

Introduction and statutory framework

[1] The Australian and International Pilots Association (AIPA) has lodged an appeal pursuant to s 604 of the Fair Work Act 2009 (FW Act), for which permission is required, against a decision issued by Deputy President Saunders on 24 February 2021 1 (decision) to consent, pursuant to s 158 of the Fair Work (Registered Organisations) Act 2009 (RO Act), to an alteration by the Australian Federation of Air Pilots (AFAP) to its eligibility rule (alteration). The existing text of the AIPA’s eligibility rule, and the text of the alteration, are set out in paragraph [4] of the decision and need not be reproduced here. It is sufficient to say that the major effect of the alteration is to give the AFAP the capacity to enrol as members pilots employed by Qantas Airways Limited (Qantas).

[2] The current legal position is that Qantas pilots are eligible to join the AIPA and the Transport Workers’ Union of Australia (TWU) but not the AFAP. The current practical position is that over 90 percent of Qantas pilots (long haul and short haul) are members of the AIPA, and a small number are members of the TWU or the AFAP. The current agreements which cover Qantas long haul and short haul pilots, the Qantas Airways Limited Pilots (Long Haul) Enterprise Agreement 2020 (EBA 10) (Long Haul Agreement) and the Qantas Airways Limited Pilots (Short Haul) Enterprise Agreement 2020 (EBA 8) (Short Haul Agreement) respectively, entrench a role for the AIPA in many aspects of the Agreements’ operation, as is discussed below, reflecting the AIPA’s current dominant position in the representation of Qantas pilots.

[3] The AIPA objected to the alteration insofar as it would allow the AFAP to enrol Qantas pilots as members. Qantas and the TWU similarly objected. The Deputy President rejected these objections. The AIPA contends in its appeal that the Deputy President erred in consenting to the alteration on a number of bases which are set out later in this decision.

[4] Section 158 of the RO Act relevantly provides:

158 Change of name or alteration of eligibility rules of organisation

(1) A change in the name of an organisation, or an alteration of the eligibility rules of an organisation, does not take effect unless:

(a) in the case of a change in the name of the organisation—the FWC consents to the change under this section; or

(b) in the case of an alteration of the eligibility rules of the organisation:

(i) the FWC consents to the alteration under this section; or

(ii) the General Manager consents to the alteration under section 158A.

(2) The FWC may consent to a change or alteration in whole or part, but must not consent unless the FWC is satisfied that the change or alteration has been made under the rules of the organisation.

(3) The FWC must not consent to a change in the name of an organisation unless the FWC is satisfied that the proposed new name of the organisation:

(a) is not the same as the name of another organisation; and

(b) is not so similar to the name of another organisation as to be likely to cause confusion.

(4) The FWC must not consent to an alteration of the eligibility rules of an organisation if, in relation to persons who would be eligible for membership because of the alteration, there is, in the opinion of the FWC, another organisation:

(a) to which those persons could more conveniently belong; and

(b) that would more effectively represent those members.

(5) However, subsection (4) does not apply if the FWC accepts an undertaking from the organisation seeking the alteration that the FWC considers appropriate to avoid demarcation disputes that might otherwise arise from an overlap between the eligibility rules of that organisation and the eligibility rules of the other organisation.

(6) The FWC may refuse to consent to an alteration of the eligibility rules of an organisation if satisfied that the alteration would contravene an agreement or understanding to which the organisation is a party and that deals with the organisation’s right to represent under this Act and the Fair Work Act the industrial interests of a particular class or group of persons.

(7) The FWC may also refuse to consent to an alteration of the eligibility rules of an organisation if it:

(a) is satisfied that the alteration would change the effect of any order made by the FWC under section 133 about the right of the organisation to represent under this Act and the Fair Work Act the industrial interests of a particular class or group of employees; and

(b) considers that such a change would give rise to a serious risk of a demarcation dispute which would prevent, obstruct or restrict the performance of work in an industry, or harm the business of an employer.

(8) Subsections (6) and (7) do not limit the grounds on which the FWC may refuse to consent to an alteration of the eligibility rules of an organisation.

(9) Where the FWC consents, under subsection (1), to a change or alteration, the change or alteration takes effect on:

(a) where a date is specified in the consent—that date; or

(b) in any other case—the day of the consent.

. . .

[5] The object of the RO Act is set out in s 5 as follows (excluding the statutory note):

5 Parliament’s intention in enacting this Act

(1) It is Parliament’s intention in enacting this Act to enhance relations within workplaces between federal system employers and federal system employees and to reduce the adverse effects of industrial disputation.

(2) Parliament considers that those relations will be enhanced and those adverse effects will be reduced, if associations of employers and employees are required to meet the standards set out in this Act in order to gain the rights and privileges accorded to associations under this Act and the Fair Work Act.

(3) The standards set out in this Act:

(a) ensure that employer and employee organisations registered under this Act are representative of and accountable to their members, and are able to operate effectively; and

(b) encourage members to participate in the affairs of organisations to which they belong; and

(c) encourage the efficient management of organisations and high standards of accountability of organisations to their members; and

(d) provide for the democratic functioning and control of organisations; and

(e) facilitate the registration of a diverse range of employer and employee organisations.

(4) It is also Parliament’s intention in enacting this Act to assist employers and employees to promote and protect their economic and social interests through the formation of employer and employee organisations, by providing for the registration of those associations and according rights and privileges to them once registered.

(5) Parliament recognises and respects the role of employer and employee organisations in facilitating the operation of the workplace relations system.

[6] The basic principles applicable to the interpretation and application of s 158, as relevant to the current proceeding, are as follows:

(1) Section 158 confers a general discretion upon the Commission to consent, in whole or in part, or to refuse consent, to a proposed alteration to an organisation’s eligibility rules, subject to the requirements to refuse consent in the circumstances described in subsections (2) and (4) (with the latter provision operating subject to subsection (5)).

(2) The Commission would, leaving aside the mandatory provisions in subsections (2) and (4), endeavour to exercise its discretionary power to grant or refuse consent in a way which gives effect to the legislature’s intention as expressed in s 5 or as otherwise made apparent in the text of the RO Act. However, s 5 does not state any legislative intention to encourage or discourage competition between organisations for membership in a given area of coverage.

(3) The legislative intention which may be gleaned from s 158 itself is that competition between organisations may be permitted to occur except in the circumstances described in subsection (2) and subsection (4) (subject to subsection (5)).

(4) For the Commission to be required to refuse consent under s 158(4) (subject to subsection (5)), it must form the opinion about the matters prescribed by both paragraphs (a) and (b).

(5) Section 158(4) operates in respect of persons who would become eligible for membership of the organisation seeking consent to the eligibility rule alteration (applicant organisation) because of that alteration. It requires, in the first instance, the correct identification of that class of persons (the class).

(6) Section 158(4) requires a comparative exercise, involving the making of a broad value judgment, between the organisation seeking consent to the rules alteration and any other relevant organisations. Section 158(4)(a) is concerned with the convenience of the persons in the class belonging to the organisations the subject of the comparison. Section 158(4)(b) is concerned with the relative capability of the organisations being compared to represent the persons in the class as members.

(7) If the Commission forms the requisite opinion as to the matters prescribed in s 158(4)(a) and (b), consent to the alteration may nonetheless be given if the Commission accepts an undertaking of the type prescribed by s 158(5). Subsection (5) does not arise for consideration unless the requisite opinion is formed under subsection (4).

(8) The matters identified in subsection (6) and (7) do not limit the grounds upon which the Commission may refuse consent to the rules alteration, as subsection (8) makes clear.

The decision

[7] Because the AIPA’s appeal grounds are concerned with the Deputy President’s consideration under s 158(4) and his exercise of the overall discretion, it is only necessary for us to refer to those parts of the decision which deal with those matters. The Deputy President stated a number of propositions about s 158(4), including that the application of the provision “involves a comparative exercise between the capacities of the organisations in question” (underlining added). 2 In accordance with the established principles which we have earlier set out, the Deputy President identified the class of persons who would become eligible because of the AFAP’s eligibility rule alteration,3 and the AIPA’s appeal does not challenge the decision in this respect. As earlier stated, there is no dispute for the purpose of this appeal that this class included pilots employed by Qantas, both long haul and short haul.

[8] In his consideration under s 158(4), the Deputy President commenced by analysing the number of (pre-Covid) Qantas pilots and found that there were approximately 1,700 long haul pilots and 600 short haul pilots, of which about 2,111 were members of the AIPA, about 20 were members of the TWU and about 65 were members of the AFAP. The 65 AFAP members were recently-recruited Qantas pilots who wished to retain their AFAP membership in order to keep their MBF loss of licence insurance, and the AFAP had agreed to allow them to retain membership on the basis that it could not provide them with industrial representation until the application for consent to the alteration had been decided. In addition, the Deputy President noted, Qantas had announced in June 2020 that it intended to reduce pilot numbers by a voluntary redundancy process. 4

[9] The Deputy President rejected at the outset the claim of the TWU to be a “better organisation” for the purposes of s 158(4), 5 and then turned to consideration of the AIPA as the other potential “better organisation”. The Deputy President found (at paragraph [177]) that there was no dispute that both the AIPA and the AFAP were well-resourced unions with a significant number of experienced and competent industrial, technical and other staff, and that both organisations had a long history of representation of pilots in the airline industry, experience in effectively negotiating enterprise agreements in the industry, experience in effectively representing pilots in a range of industrial, disciplinary, employment, safety and investigation matters, experience in providing advice to pilots as to their employment entitlements, expertise in safety and technical matters, a substantial number of members, a strong national presence in the industry, a member assistance program, a welfare function, established methods to communicate with and inform members, substantial reserves, death benefits, discount accommodation and a range of other such benefits, and broadly similar annual membership fees.6 The Deputy President found that these factors suggested that Qantas pilots could conveniently belong to either the AIPA or the AFAP, and that both unions would effectively represent these pilots. However, the Deputy President found that there were some factors which gave the AFAP an advantage over the AIPA and others which gave the AIPA an advantage over the AFAP, and that it was necessary for him to describe these relative advantages and disadvantages and make an overall evaluative assessment under s 158(4).7 As to the proper approach to be taken in this assessment, the Deputy President said (footnote omitted):

“[179] The assessment as to whether there is a better organisation is required to be made at the time this decision is made. Accordingly, the question is whether, at the time this decision is made, there is an organisation other than the AFAP to which the Class (or any part of it) could more conveniently belong and that would more effectively represent those persons. Although the time at which that question must be answered is now, it is permissible, in my opinion, to have regard to likely future events. So much is apparent from the nature of the inquiry - determining whether an organisation would more effectively represent members necessitates an assessment of the types of matters in respect of which members may require representation in the future. For example, it may be concluded in a particular case that, as at the date the application is determined, organisation A is a “better organisation” than organisation B because it is known that the relevant group of members is about to commence enterprise bargaining and organisation A has, as at the date the application is determined, a greater capacity to represent the members in such bargaining than organisation B, and it would be more convenient for the group of members to belong to organisation A than organisation B.

[180] The task is to consider the current capacity of the respective organisations to represent members (assuming the application were allowed), as well as the convenience of those members to belong to the respective organisations.”

[10] The Deputy President then identified the principal areas where he considered that Qantas pilots are likely to need representation in the future, and said in his view the AFAP had an advantage over the AIPA as a result of its structure as an occupational union and its extensive exposure to the whole industry, and that the AFAP had the capacity to draw on the knowledge and experience of pilots from a range of other airlines and the AFAP’s Councils operating in connection with those other airlines, and also that the AIPA had the capacity in bargaining to obtain non-confidential information from Virgin. 8 The Deputy President rejected the AFAP’s contention that the AIPA’s structure as a company union created a risk of “capture” by Qantas and led to conflicts of interest which eroded pilot trust in the organisation, and found that the evidence demonstrated that the AIPA had a long history of both working cooperatively with Qantas and “taking on” Qantas in a range of disputes, bargaining and litigation when it was in the best interests of members to do so.9

[11] The Deputy President next found the AIPA had an advantage over the AFAP in its capacity to represent Qantas pilots in relation to a whole range of matters, and the rights and duties the AIPA has under the Short Haul Agreement and the Long Haul Agreement (Agreement rights). 10 The Deputy President then engaged in an extensive and detailed analysis of each of the Agreement rights held by the AIPA under the following headings:

•  Checking bid lines prior to promulgation;

•  Bid line allocation process;

•  Introduction of new computer programs for pattern line construction;

•  Dispensations from flight and duty limits;

•  Fatigue risk management system;

•  Scheduling and consultative committees;

•  Boards of appeal;

•  Re-employment after medical termination;

•  Special circumstances;

•  Initial allocations of Second Officers;

•  Demotions;

•  Promotions and the Pilot Assessment Committee;

•  Base transfers on compassionate grounds;

•  Class of travel for paxing;

•  Selection of accommodation;

•  New aircraft or equipment; and

•  Accident and incidents. 11

[12] The Deputy President accepted in paragraph [258] of the decision that: the provisions conferred rights enforceable in the courts and in the Commission; the Agreement rights were exclusive to the AIPA and the AFAP would not have these rights for at least so long as the Short Haul Agreement and the Long Haul Agreement remained in operation; the Agreement rights concerned important and in many cases fundamental conditions of employment including who does what work, where, when and how; the Agreement rights were valuable and placed the AIPA in a position of power; and their purpose was to protect pilots against decisions which may otherwise be made by Qantas contrary to their interests. 12 The Deputy President said however that it was “important to separate out (a) the role the AIPA plays in exercising its rights and undertaking its duties under the applicable provisions of the enterprise agreements from (b) any role the AIPA may play in representing one or more pilots (who are members of the AIPA) in relation to the provision or the subject matter with which it is concerned.”13 In relation to the former, the Deputy President said that “regardless of whether an AIPA member is involved or affected, the AIPA is obliged by the relevant provisions of the enterprise agreements to undertake a particular task or action, or consider agreeing or disagreeing to a particular proposal”, and gave examples of these.14 The Deputy President then said:

“[261] The AIPA performs these functions under the enterprise agreements on behalf of the group of Qantas pilots covered by the applicable enterprise agreement as a whole, not in its capacity as a representative of one or more of its members.

[262] As to its role as a representative of one or more pilots in connection with a particular issue or dispute, the AIPA may be called on to provide guidance, assistance, advice and/or advocacy to any of its pilots who are involved in, or affected by, the matter.

[263] In my view, given the AIPA’s long history and experience with Qantas, including exercising its rights and duties under the relevant provisions of the applicable enterprise agreements and representing its members in matters and disputes with Qantas under the applicable enterprise agreements or Qantas’s policies, customs or practices, if this application is granted the AIPA will have an advantage over the AFAP, at least for an initial period, in representing Qantas pilots in particular matters and disputes. The AIPA will have such an advantage because it knows and understands, from long experience, both the relevant provision, requirement or rule in the applicable enterprise agreement, policy, custom or practice within Qantas’s somewhat unique business and, more importantly, how such issues have been resolved in the past and what factors were influential in resolving the issue by agreement with Qantas, by determination on the part of the AIPA (when it has such a right), or by persuading a third party such as a Board of Appeal to determine the matter in a particular manner.”

[13] The Deputy President found that by virtue of its experience with other airlines, the AFAP had the capacity and experience to provide effective representation to one or more of its members in connection with a dispute with Qantas concerning a new or amended computer program for pattern line construction for long haul pilots, and could lobby Qantas or use the disputes procedures in the Agreements to represent members in this respect. However, he said that the AFAP, unlike the AIPA, did not have the right under the Long Haul Agreement to require the provision by Qantas of specifications and other relevant information, nor did it have the same experience as the AIPA in reaching agreement in relation to the computer programs for pattern line construction. 15 The Deputy President then said:

“[266] The significant number of important rights and duties conferred and imposed on the AIPA by the applicable enterprise agreements, together with the experience the AIPA has in exercising those rights, undertaking those duties, representing Qantas pilots, and dealing with Qantas in general, puts the AIPA in a more advantageous position in relation to representation than is usually the case for an incumbent union objecting to the alteration of another union’s coverage rules. This representational advantage which the AIPA has extends to a whole range of matters and disputes, including rostering and scheduling, investigations into accidents and incidents, demotions, promotions, base transfers, and proposals by Qantas to introduce material changes in the workplace.

[267] I accept that the enterprise agreements which the AIPA has negotiated with Qantas to cover its short haul pilots and its long haul pilots are the “gold standard”. Those terms and conditions of employment are superior to those enjoyed by pilots in other Qantas operations, and in other Australian airlines. The AIPA has performed well in negotiating these terms and conditions of employment with Qantas. But the existence of such favourable terms and conditions of employment for Qantas pilots does not, in my view, establish that the AIPA is the “better organisation” for the Class or any part of it. The nature and quality of terms and conditions of employment which can be negotiated by or on behalf of employees with a particular employer is dependent on a range of factors, including the nature, size and profitability of the employer and the industry in which it operates. Qantas is the market leader in the Australian airline industry and operates in a higher profit margin environment than lower cost airlines such as Jetstar. I am satisfied that if another competent and experienced union operating in the airline industry, such as the AFAP, had negotiated enterprise agreements with Qantas to cover its short haul and long haul pilots, the outcome achieved for pilots would have been comparable with that which AIPA has secured for Qantas’s pilots.”

[14] The Deputy President again rejected the proposition that the closeness of the AIPA’s relationship with Qantas and its managers compromised the effectiveness of its representation, but likewise rejected that this made the AIPA more effective than the AFAP. 16 In relation to the unions’ future bargaining capacities, the Deputy President said:

“[270] In bargaining for future enterprise agreements, the AFAP will be a bargaining representative and will have a statutory right to bargain on behalf of its members, as will the AIPA. Both organisations have extensive experience in negotiating enterprise agreements, developing and executing bargaining strategies, potentially taking protected industrial action, drafting provisions to be included in enterprise agreements, preparing documents in support or, or against, an application for approval of an enterprise agreement. The AFAP has an advantage in representing members in bargaining by reason of its extensive industry-wide experience. The AIPA has an advantage in representing members in bargaining by reason of its extensive experience in bargaining with Qantas. As to whether the AIPA will or will not in future rounds of enterprise bargaining be able to retain all of the exclusive rights it has under the current enterprise agreements at Qantas, that will not, in my opinion, have any material impact on the effectiveness of either the AIPA or the AFAP to represent their members in bargaining for a new enterprise agreement. Further, although I accept that it is not in the AIPA’s interests to relinquish or share any of these rights and the AIPA Committee of Management has recently passed a resolution confirming that the AIPA will oppose and object to the AFAP being granted any such rights under the applicable enterprise agreements, whether the AIPA will be able to retain the exclusive rights in subsequent rounds of bargaining will depend on a whole range of matters such as the number of members the AFAP has in Qantas at the time, the number of members the AIPA has in Qantas at the time, the relationship between the AFAP and the AIPA at the time, the approach and attitude of Qantas at the time, the nature and profitability of Qantas’s business at the time, and the nature of the aviation industry at the time. Those matters are not capable of being known at present. In addition, it is the relevant cohort of employees (short haul pilots or long haul pilots) who will vote on a new proposed enterprise agreement, not the AIPA. It is therefore not helpful to speculate about what might occur in relation to these matters in bargaining in 2023 or 2024.”

[15] The Deputy President found that both organisations had the same rights and capacity to pursue claims for unpaid entitlements and unfair dismissal. 17 He accepted that the AIPA’s greater knowledge and experience in relation to Qantas’ operations would give it a representational advantage, but found that the weight to be given to this was diminished by a number of factors which he identified including that in some matters or disputes the AFAP’s greater industry knowledge may be more important.18 In relation to union density, the Deputy President said:

“[274] I do not accept the AIPA’s contention that its high level of density among Qantas pilots demonstrates, or suggests, that it can more effectively represent Qantas pilots. The AIPA has just over 90% of Qantas pilots as members. In light of that level of density, I accept the AIPA’s submission that (assuming the application succeeds) when a Qantas pilot joins the AFAP it will probably mean that the pilot in question has ceased to be a member of the AIPA. Accordingly, consenting to the AFAP’s proposed rule change is likely to decrease the number of Qantas pilots who are members of the AIPA. However, it does not necessarily follow that consenting to the AFAP’s proposed rule change will decrease union density among the whole cohort of Qantas pilots. Having regard to the high current level of union density among Qantas’s pilots and for pilots in the aviation industry generally, I am of the opinion that consenting to the AFAP’s application is not likely to have a material impact on union density among Qantas pilots. Further, as the AIPA submits, correctly in my view, all other things being equal, the higher the level of unionisation (a) the greater the collective power of the employees and (b) the more authoritative and effective the voice of the employees in their discussions with management. If union density among Qantas pilots remains at a high level, as I expect it will, even though it will be spread between the AIPA, the AFAP, and, to a minor extent, the TWU, the collective power of the pilot cohort will remain strong and the voices of those pilots will remain authoritative and effective.”

[16] The Deputy President rejected the AIPA’s contention that the AFAP was not serious about representing Qantas pilots, 19 and regarded it as relevant to the convenience factor that the evidence was that Qantas respects freedom of choice of union and would accommodate this, that AFAP membership would allow a Qantas pilot to retain their membership if they moved to another airline, and that AFAP members could purchase loss of licence insurance through the MBF while noting that Qantas provided a lesser level of loss of licence insurance for no cost under the Agreements.20 The Deputy President then stated the following conclusion in respect of s 158(4):

“[281] I have identified, assessed and weighed a range of matters that give each organisation (the AFAP and the AIPA) a competitive advantage over the other in evaluating which is the “better organisation” for Qantas pilots. Those advantages principally arise, respectively, from the AFAP’s extensive experience representing pilots across the whole of the aviation industry and the AIPA’s extensive experience, as the incumbent union, representing Qantas pilots and exercising its rights and undertaking its duties under the applicable Qantas enterprise agreements and their predecessors. In all the circumstances, I find that, as at the date this application is determined:

•  all Qantas pilots could conveniently belong to the AIPA or the AFAP. However, I am not persuaded on the evidence that any Qantas pilots could more conveniently belong to the AIPA (or any other organisation) than the AFAP; and

•  the AIPA and the AFAP would effectively represent Qantas pilots. However, I am not persuaded on the evidence that the AIPA (or any other organisation) would more effectively represent any Qantas pilots than the AFAP.”

[17] After dealing with s 158(5), (6) and (7) in a way which is not the subject of challenge in the AIPA’s appeal, the Deputy President dealt with the general discretion to consent to or refuse the application. In respect of the benefit to the class of consenting to the application, the Deputy President accepted the evidence of Captain Bollard (an AFAP witness) that competition between unions at Jetstar since 2008 had “kept the AFAP on their toes and honest” and said that “[c]onsenting to the present application by the AFAP will, in my view, have a similar effect on the AIPA and the AFAP in terms of the quality of services they provide to pilots in the Class”. 21 The Deputy President found that “The AFAP is well placed to offer competition and choice for pilots in the Class, in that the evidence establishes that the AFAP is a well-run and effective pilots’ union” and accepted hearsay evidence that a number of Qantas pilots would join the AFAP if the AFAP had coverage over Qantas pilots.22 While rejecting the AFAP’s contention that there was any significant dissatisfaction among the AIPA’s members with the leadership of the AIPA and finding that the evidence established that the AIPA had been successful in negotiating “gold standard” enterprise agreements and working with Qantas in a cooperative and effective manner for the benefit of both Qantas pilots and Qantas,23 the Deputy President found:

“[296] The existence of a desire on the part of at least some Qantas pilots to join the AFAP - a well-run and effective pilots’ union - coupled with the benefits which competition and choice will provide to Qantas pilots, are discretionary factors which weigh in favour of consenting to the proposed rule change.”

[18] While accepting that consenting to the alteration would almost certainly reduce the number of Qantas pilots who were AIPA members and thus reduce the AIPA’s revenue, the Deputy President did not accept it would cause the AIPA to have an existential crisis or lead to its extinction. 24 The Deputy President also did not accept that consenting to the alteration would diminish the collective power of unionised pilots, and noted that the introduction of union competition at the Eastern and Sunstate airlines appears to have increased or maintained union density.25 To the contrary he found that the introduction of “an active, well-resourced pilots’ union with extensive industry-wide experience (the AFAP) for Qantas pilots to join will increase the collective power of unionised pilots at Qantas”.26 The Deputy President said:

“[301] Thirdly, I accept it is possible that there could be disputation between the AIPA and the AFAP which may diminish the collective power of the unionised pilots at Qantas. There is also the prospect that Qantas could seek to “play off” one union against the other and thereby diminish the collective power of the whole group of unionised pilots at Qantas. However, I do not consider that either of those outcomes is likely. Ultimately those pilots, as members of the AIPA or AFAP (or the TWU), will be keen to ensure that their unions act in their best interests and do not permit any disputes between the unions or tactics adopted by Qantas to cause them any material detriment. Any union leader who puts their own self-interest or the interests of their union over the interests of the members they represent, particularly educated, experienced and long-term union members such as most of the Qantas pilots, is likely to be removed from office or not have their proposals endorsed by the governing bodies within the union. Further, the AFAP and the AIPA have proven themselves to be able to work together constructively, and without damaging disputation, at Jetstar and other Qantas group airlines, for many years. On the two occasions over the last 13 years in which there has been a disagreement between the two unions, the differences have not resulted in any material damage….”

[19] The Deputy President did not accept that granting consent to the alteration would lead to harm to pilots’ conditions under the current Long Haul Agreement, and said it was difficult to speculate on what would happen in the next round of bargaining negotiations or the next one after that. 27 The Deputy President rejected the proposition that the grant of consent would be contrary to the objects of the FW Act and the RO Act,28 and also rejected the proposition advanced by Qantas that it would materially impact the relationship between the AIPA and Qantas or the interests of Qantas29 and the proposition advanced by both Qantas and the AIPA that consent should not be granted in the context of the COVID-19 pandemic and its significant impact on Qantas.30 The Deputy President concluded that, in all the circumstances and for the reasons he had given, he consented to the alteration.31

Appeal grounds and submissions

Australian and International Pilots Association

[20] In its notice of appeal, as amended and pressed at the hearing, the AIPA advanced four grounds of appeal. The first three grounds relate to the Deputy President’s conclusion with respect of s 158(4), and the fourth relates to the Deputy President’s exercise of the overall discretion.

[21] Ground 1 of the appeal concerns the construction of s 158(4) of the RO Act. The AIPA contends that the Deputy President erred in construing s 158(4) as requiring a comparison of the “capacities” of the competing organisations because the provision does not refer to the “capacities” of the organisation but rather convenience and effective representation. Thus, it submitted, the fact that an organisation with “base level competence” may have the capacity to represent the disputed class of persons, does not mean that it is equal or superior in respect of convenience of belonging or effectiveness of representation when compared to the organisation with existing coverage. Further, it was submitted, the Deputy President erred by considering the current capacity of the respective organisations. The AIPA submitted that the proper question raised by s 158(4) is: what will happen if the application is, or is not, granted, having regard to the state of play at the time the application is determined? It submitted that the Deputy President failed to answer this question.

[22] Ground 2 of the AIPA’s appeal contends that, in respect of the 17 exclusive rights which are conferred on the AIPA under the Short Haul Agreement and the Long Haul Agreement, the Deputy President:

•  failed to give appropriate weight to these rights and to draw the correct inference that they rendered the AIPA the better organisation compared to the AFAP;

•  failed to find that the 17 rights made the AIPA the better organisation compared to the AFAP;

•  made incorrect findings about the representative role of the AIPA concerning the rights and duties under these provisions; and

•  failed to make findings, or the correct findings, about the likely continuation of the provisions in the Agreements containing these rights after the application before the Commission was determined.

[23] The AIPA submitted that the Deputy President accepted that: the Agreements conferred these as rights, not discretionary benefits; the rights were exclusive to the AIPA and would not be enjoyed by the AFAP at least while the Agreements remain in effect; they concern important conditions of employment including the fundamental matters of who does what work, where, when and how; and they confer valuable rights which place the AIPA in a position of power. However, the Deputy President failed to find what, it was submitted, necessarily followed from this, namely that the AIPA as the holder of these rights was a better organisation, since they permitted the AIPA to perform the core functions of a union better than an organisation without those rights and thus gave the AIPA a competitive advantage. The AIPA submitted that the Deputy President dealt with its case in this respect by distinguishing between rights and duties of the AIPA in relation to all pilots and those where the AIPA acted as an advocate, guide or assistant for particular members and, in respect of the former category, erroneously found that the AIPA performs its functions on behalf of the whole group of Qantas pilots and not as a representative of one or more of its members and thus effectively excluded those rights from his assessment. This approach was in error, it was submitted, because: these functions were about matters pertaining to the employment relationship; that if the AIPA prevented Qantas making decisions that were detrimental to pilots about who does what work, when, where and how, it was representing pilots; “representation” in s 158(4)(b) extends to representation of non-members; and when a union represents all employees, it is also representing its members since it has long been accepted that unions have a recognised interest in the conditions of non-members.

[24] By appeal ground 3 the AIPA contends, on the assumption that in paragraph [266] of the decision the Deputy President found that the 17 rights conferred on the AIPA in the Agreements placed the AIPA in a position of representational advantage, that coupled with the other representational advantages held by the AIPA and the relative insignificance of any advantages enjoyed by the AFAP, the conclusion reached by the Deputy President in paragraph [285] that there was no organisation other than the AFAP to which any pilots in the relevant class could more conveniently belong and that would more effectively represent those persons was unreasonable. In respect of the representational advantages considered by the Deputy President to be held by the AFAP, the AIPA submitted:

•  the fact that the AIPA maintained the modern award was irrelevant or a matter of trifling significance, since the modern award had never applied to Qantas pilots, who had been covered by enterprise agreements on an informal or formal basis since 1966;

•  there was no inherent advantage in the AFAP having an occupational structure;

•  the finding in paragraph [183] that the AFAP could draw on its industry-wide knowledge and experience when representing pilots about a range of matters was inconsistent with the findings in paragraph [258] that the AIPA had exclusive, valuable rights to protect pilots in relation to such matters and in paragraphs [185] and [266] that the AIPA had a competitive advantage over the AFAP due to its long history and experience, and, in any event, the alleged advantage was insignificant;

•  any advantage said by the Deputy President to be held by the AFAP in bargaining by reason of its extensive industry-wide experience was not meaningful, since the AIPA has an advantage in representing members in bargaining by reason of its extensive experience in bargaining with Qantas (as the Deputy President found);

•  the MBF insurance scheme which applied to AFAP members did not weigh in favour of the AFAP on the conveniently belong limb, contrary to the Deputy President’s finding, since it was paid for by member contributions and not by employers, and for non-members the convenience is merely the convenience of the choice to be a member of one scheme rather than any other scheme available in the market; and

•  the convenience identified in paragraph [278] of the decision that a pilot can retain their AFAP membership if they move from Qantas to another airline is speculative, since there was no evidence that Qantas or any other airlines were recruiting or were likely to recruit.

[25] By contrast, the AIPA submitted, the 22 matters which the Deputy President found to weigh in favour of the AIPA, including the 17 rights under the Agreements, were all matters of significance. They were all directly relevant to the convenience of the relevant class of persons, since the industrial interests of the class is the most important factor in determining convenience of belonging under s 158(4)(a). The advantages enjoyed by the AIPA arising from the Agreement rights would, if the AFAP gained coverage of Qantas pilots, reduce it (the AFAP) to a secondary, lesser role in representing the disputed class, meaning that the AIPA was the better organisation because it is not in that subsidiary position. Further, it was submitted, the fact that the AIPA currently has as members about 91.7 percent of the disputed class proves that the AIPA can more effectively represent that class, and demonstrates that it is more convenient for existing members to remain members of the AIPA. Once these inferences were drawn, it was unreasonable when considering the entire class, not just the unionised portion of the workforce, to conclude that the AIPA was not the better organisation.

[26] Appeal ground 4 contends that the Deputy President erred in the exercise of the discretion by:

•  failing to give consideration or appropriate weight to the demarcation disputes that would be created by the grant of the application;

•  taking into account or giving too much weight to irrelevant factors such as the AFAP’s likelihood of recruiting members and representing them under current and future enterprise agreements, particularly in circumstances where the majority of Qantas pilots who were AFAP members retained their membership for insurance purposes and the majority of whom had not sought industrial representation by the AFAP; and

•  basing the decision on speculation that the grant of consent would keep the AIPA on its toes and honest, while finding that the conditions negotiated by the AIPA were already “the gold standard” and that union density was already extremely high, and when there was no allegation that the AIPA would not continue to be honest.

[27] In respect of this appeal ground, the AIPA submitted that the Deputy President gave two reasons why the discretion to refuse consent was not exercised: first, the desire to join the AFAP and, second, the benefits of competition and choice. In relation to the first, the AIPA submitted that there were about 65 legacy members of the AFAP who had been recruited by Qantas and retained their AFAP membership so that they could keep their MBF loss of licence insurance, and there was no evidence that they wanted to have their industrial interests represented by the AFAP. Beyond this, there was a paucity of evidence that anyone wanted to join the AFAP, since there was only indirect evidence that “a number” of or “numerous” pilots wanted to join the AFAP. As to the second the AIPA submitted that, given the Deputy President found that the AIPA had already achieved the gold standard and the best conditions for pilots in Australia, the notion that the AIPA needed to be kept on its toes or motivated lacked foundation. The RO Act does not identify freedom of association or choice as benefits to be encouraged and, it was submitted, there was no evidentiary foundation identifying the benefits of any choice or any dissatisfaction about the current choice.

[28] The AIPA further submitted in relation to the exercise of the discretion that the Deputy President should have, but did not, take into account the demarcation dispute that would arise if consent was granted. Such a dispute would arise from the AIPA’s interest in not sharing or relinquishing its Agreement rights in circumstances where the AFAP would seek to enjoy the same rights, and would meet the definition of demarcation dispute in s 9 of the RO Act. It was submitted that the Deputy President should have concluded that the AFAP would never be the beneficiary of any of the rights conferred on AIPA by the Agreement, that the AFAP would retain its current membership but no more in Qantas, that the AFAP would forever be in a subsidiary position compared to AIPA and reduced to lobbying the AIPA to exercise the AIPA’s rights in a way favourable to the AFAP’s members, and that these were further reasons for refusing consent to the alteration.

[29] The AIPA submitted that permission to appeal should be granted because the decision was attended by significant error, reached a manifestly unreasonable conclusion under s 158(4), misapplied principle and what it means to “represent” for the purposes of s 158(4), incorrectly suggested that occupational unions have inherent advantages that make them more effective representatives, and would have a significant impact on the industrial rights of more than 2,000 employees in one of Australia’s most significant employers, and because the appeal raises important issues about the “assessment of the counter factual when applying s 158(8)”. It was submitted that the appeal should be upheld and the matter remitted to the Deputy President or another member of the Commission for determination in accordance with the Full Bench’s reasons.

Australian Federation of Air Pilots

[30] The AFAP submitted, in overall summary, that:

•  the AIPA’s main complaint was that the Deputy President should have found that the AIPA was a better organisation than the AFAP under s 158(4) given the mere existence of the Agreement rights, but in circumstances where the AFAP could represent pilots effectively without those rights and had other advantages as an industry-wide union, it was not unreasonable or plainly unjust to conclude that the AIPA was not, overall, a better organisation;

•  the AIPA’s secondary complaint was that the Deputy President should not have found that the alteration would promote competition and choice, however that finding was both open and correct and, in any event, it was not sufficient to show that an intermediate finding made by the Deputy President was wrong or unreasonable in order to establish appealable error;

•  the Deputy President was correct to find that the prospect of there being demarcation disputation arising from the AIPA opposing the AFAP gaining the same Agreement rights was too speculative to be given any weight but, even if this finding was wrong, it was again insufficient to show that an intermediate finding made by the Deputy President was wrong or unreasonable in order to establish appealable error; and

•  the AIPA’s appeal was an attempt to re-argue the merits of the case, ignoring the House v The King limitations upon appeals from discretionary decisions, and there was no error in the decision.

[31] In relation to appeal ground 1, the AFAP submitted that it was well-established that s 158(4) requires a comparison of the competing unions to provide convenient and effective representation as assessed at the time of the decision and it is apparent from a fair reading of the decision as a whole that the Deputy President correctly understood what was required by s 158(4) and applied the provision correctly. As to the alleged failure to make findings about future outcomes, the AFAP submitted that it was not apparent how these matters bore upon the current capacity of the AFAP to represent Qantas pilots, there was no evidentiary basis to make the findings referred to by the AIPA concerning the “remote and indefinite future”, and there was evidence that a number of Qantas pilots wanted to join the AFAP, meaning that if any finding were to be made, it would be that the AFAP’s membership was likely to grow.

[32] In relation to appeal ground 2, the AFAP submitted that, on a fair reading of the decision, the Deputy President did not exclude from consideration those of the Agreement rights which allowed the AIPA to regulate industrial conditions for pilots generally. The Deputy President, it was submitted, well understood that for the purposes of s 158(4) he was to consider the AIPA’s capacity to represent the whole class of Qantas pilots, not just its own members, separately considered each of the Agreement rights without overlooking any of them, and gave credit to the AIPA in his s 158(4) assessment in protecting the interests of pilots generally as well as assisting its own members.

[33] As to ground 3, the AFAP submitted that:

•  it was not unusual for the Commission to grant a union entry to an area of eligibility in which an incumbent union has existing rights under collective agreements, including in the airline industry, and the question is always whether such rights deprive the applicant union of the capacity to represent the class of employees in question as effectively as the incumbent union taking into account the ability of the applicant union to represent such employees without such rights as well as the other advantages the applicant union may have over the incumbent union;

•  the AIPA failed to establish that the Agreement rights were insurmountable obstacles to the AFAP representing Qantas pilots, and the Deputy President appreciated that the AFAP would have statutory rights to bargain under the FW Act, would have the right to be consulted by Qantas in respect of major change, could represent pilots in formal disputes and grievances at their election, could represent pilots by lobbying or making submissions about matters the subject of the Agreement rights or other matters, and could provide advice and assistance to pilots and represent them in disputes and litigation;

•  the evidence established that Qantas respected and would accommodate freedom of choice of union, and there was no real fear that Qantas would refuse to deal with the AFAP unless legally compelled to do so;

•  on a fair reading of the decision, the Deputy President found that the Agreement rights were important and gave the AIPA a representational advantage over the usual incumbent union, but did not of themselves give the AIPA an overall representational advantage over the AFAP;

•  the AIPA’s submissions did not acknowledge the “true import or power” of the Deputy President’s findings concerning the advantages of the industry-wide nature of the AFAP, including the benefit of input to the AFAP’s Qantas Mainline Council from the AFAP’s other councils, the capacity of the AFAP to co-ordinate industrial strategy and bargaining across the whole industry, the AFAP’s access to information about Virgin’s operations and plans, and the capacity of the AFAP to draw upon its industry-wide knowledge so as to better represent Qantas pilots, such as in relation to accidents, investigations, safety matters, promotions, demotions, disciplinary action and dismissals;

•  the Deputy President clearly considered the AIPA’s submission that the AFAP would be in a secondary role at Qantas insofar as he accepted that it was likely that (at least initially) the AFAP would have fewer members than the AIPA and would not have the Agreement rights; and

•  existing union density was not conclusive as to the s 158(4) questions and, given the propensity of pilots to unionise, the high union density of the AIPA at Qantas where it was the only active union to join was not automatic proof of its effectiveness and convenience.

[34] In relation to Ground 4, the AFAP submitted that the AIPA was incorrect to assert that competition/choice factors were the critical or only factors which caused the Deputy President not to refuse consent. The finding that competition would keep the AIPA on its toes was open given the evidence concerning the effect of competition on the AFAP at Jetstar. There was also evidence to support the finding that at least some Qantas pilots wished to join the AFAP, including evidence that a significant number of Qantas pilots had indicated a desire to join the AFAP such that it was expected that the AFAP could recruit 100 members within 12 months if consent was granted. The AFAP also submitted that the Deputy President’s finding that the AFAP was a well-run and effective pilots’ union which had advantages as an industry-wide union which the AIPA lacked made it well open for him to find that allowing pilots the choice of AFAP membership would be of benefit to Qantas pilots.

[35] As to the potential of demarcation disputes, the AFAP submitted that the Deputy President had accepted the AFAP’s submission below that damaging demarcation disputes were not likely to occur in response to submissions made by AIPA concerning the likelihood of demarcation disputes arising from a contest about whether the AFAP would seek equal rights under the Agreements to those enjoyed by the AIPA. It further submitted that the Deputy President was correct in not being prepared to speculate about the relationship between the AIPA and the AFAP in bargaining to occur in 2023 or 2024, since this required speculation about whether the AFAP would find it could not effectively represent pilots without the Agreement rights, whether the AFAP would acquire sufficient members to make a credible claim for equal rights, whether the AFAP will claim equal rights rather some lesser right which the AIPA would not oppose, and whether the AIPA would remain opposed to the AFAP having equal rights after consent was granted.

Other parties

[36] The TWU supported the submissions of the AIPA but made no separate submissions of its own. Qantas did not make any submissions in the appeal.

Consideration

Permission to appeal

[37] We consider that the grant of permission to appeal would be in the public interest because the decision concerns the representation of a critical element of the workforce of a major Australian business and may have effects on the operations of that business and its employees. As a result, permission to appeal must be granted in accordance with s 604(2) of the FW Act.

The s 158(4) grounds

[38] Before we turn directly to the AIPA’s first three appeal grounds, we make three general and related observations about this aspect of the appeal. First, s 158(4) requires (subject to s 158(5)) the refusal of consent to an eligibility rule alteration if, and only if, the member hearing the matter forms the opinion prescribed in the subsection. This involves the making of a discrete discretionary decision involving a degree of subjectivity and latitude. 32 On appeal from such a decision, it is therefore necessary for the appellant to demonstrate error of the House v The King33 type.

[39] Second, the AIPA does not allege any error of primary fact-finding in the Deputy President’s consideration under s 158(4). Apart from appeal ground 1 and one aspect of appeal ground 2, which allege particular errors of principle, the AIPA’s challenge to the Deputy President’s conclusion in respect of s 158(4) is based on the value judgments to be made on the basis of the primary facts and the weight to be given to the various competing considerations. However, having regard to the degree of subjectivity and latitude involved in the decision-making process, an appeal brought on this basis cannot succeed unless it is demonstrated that the Deputy President made value judgments which were unreasonable or unavailable on the facts or failed to give weight to relevant considerations to such a degree that his exercise of the discretion miscarried. This represents a high hurdle for the AIPA to surmount.

[40] Third, critical aspects of the Deputy President’s decision in respect of s 158(4) remain unchallenged in the appeal. The findings made by the Deputy President in paragraph [177], to which reference has earlier been made, establish in summary that both the AIPA and the AFAP are well-resourced, competent and experienced unions and well-placed to properly represent the industrial interests of pilots in the domestic and international aviation industry. Additionally, at various points in the decision, the Deputy President rejected the various criticisms of each other’s performance respectively advanced by the AIPA and the AFAP. That meant that, at the outset, the question of whether any discernible difference in convenience of belonging and effectiveness of representation existed for the purpose of s 158(4) was likely to be a marginal one about which reasonable minds might differ. This was not a case where the interloper union was clearly lacking in the qualities necessary to enter the field of coverage the subject of the eligibility rule alteration.

[41] In respect of appeal ground 1, we do not consider that the Deputy President erred in his construction of s 158(4). It is apparent on a fair reading of the decision that the Deputy President’s use of the word “capacity” was a shorthand expression for the matters referred to in paragraphs (a) and (b) of s 158(4), and the Deputy President made it clear, correctly, that what was required was a comparative assessment of the relative “capacities” of the organisations in question. The Deputy President nowhere suggested that it was sufficient for an organisation applying for consent to an eligibility rule alteration to meet a “base level” of competence in order to avoid the refusal of consent under s 158(4). As to the time by reference to which the comparative assessment is to be made, the approach taken by the Deputy President in paragraphs [179]-[180] of the decision whereby the s 158(4) criteria are to be applied at the time of the decision by the Commission taking into account likely future events is consistent with established authority. 34 It is therefore not clear to us the basis on which the AIPA takes issue with the approach whereby the Deputy President compared the current relative capacities of the AIPA and the AFAP. The question which the AIPA contends was “the proper question” required to be answered under s 158(4) puts an unnecessary gloss on the provision, and we do not consider that the Deputy President erred by not asking and answering that question. We are wholly satisfied that the Deputy President construed and applied s 158(4) in a correct and orthodox fashion. Appeal ground 1 is rejected.

[42] Appeal grounds 2 and 3 involve a number of rolled-up contentions which we consider, in substance, to amount to little more than an invitation to re-determine ourselves the s 158(4) issue by giving determinative weight to the 17 Agreement rights currently conferred on the AIPA by the Long Haul Agreement and the Short Haul Agreement. It is perfectly apparent that the Deputy President gave very detailed consideration to the Agreement rights: some 69 paragraphs of the decision were concerned with analysing the nature and significance of each of the Agreement rights. Further, as the AIPA acknowledged in its submissions, the Deputy President’s findings in paragraph [258] of the decision, to which we have referred, make it clear that he regarded the Agreement rights, considered collectively, as a matter of importance and considerable weight in his assessment under s 158(4). The Deputy President also accepted in paragraphs [263] and [266] that the AIPA’s exercise of the Agreement rights considered together with the AIPA’s “long history and experience with Qantas” constituted an advantage which the AIPA held over the AFAP for the purpose of s 158(4). It cannot be said therefore that the Deputy President failed to have regard to the Agreement rights as a materially relevant matter and thus fell into appealable error in that respect.

[43] We do not accept that, as the AIPA contends in appeal ground 2, the Deputy President did not take into account that category of Agreement rights which he categorised as requiring the AIPA to act on behalf of the whole class of Qantas pilots covered by the relevant Agreement, whether members of the AIPA or not, for the purpose of assessing comparative representation effectiveness under s 158(4)(b). It may be accepted that the Deputy President did not make pellucidly clear the purpose of the distinction which he drew in paragraphs [260] and [261] between Agreement rights falling into this category and Agreement rights which involve the AIPA acting as representative for specific members. However, the Deputy President said in paragraph [266]: “This representational advantage which the AIPA has extends to a whole range of matters and disputes, including rostering and scheduling, investigations into accidents and incidents, demotions, promotions, base transfers, and proposals by Qantas to introduce material changes in the workplace”. This sentence makes it abundantly clear that the Deputy President regarded the Agreement rights falling into the former as well as the latter category as encompassing part of the representational advantage which he considered the AIPA held over the AFAP. The AIPA’s contention in this respect is therefore rejected.

[44] Beyond this, appeal grounds 2 and 3 effectively amount to no more than a contention that the findings which the Deputy President made concerning the significance of the Agreement rights and the representational advantage which they conferred on the AIPA allowed for no conclusion other than that the AIPA was the “better organisation” in respect of both limbs of s 158(4) and that the Deputy President’s failure to form this opinion was unreasonable. We do not accept this contention. We consider it was reasonably open for the Deputy President to conclude that the AIPA’s advantage in holding the Agreement rights did not outweigh the countervailing advantages which he found that the AFAP enjoyed, having regard to the following matters:

(1) It is not clear from the AIPA’s submissions why the Agreement rights render it more convenient to belong to the AIPA than the AFAP when, as the Deputy President recognised, many of the Agreement rights are required to be exercised by the AIPA on behalf of all Qantas pilots whether members of the AIPA or not. That is, a pilot could equally conveniently join the AFAP and still enjoy whatever benefit is derived by pilots generally from the exercise by the AIPA of its functions under the Agreement rights provisions.

(2) The representational advantage which the AIPA submits it has because of its possession of the Agreement rights may be overstated having regard to the scope of the dispute resolution/grievance procedures in the Agreements (clauses 47 and 48 of the Long Haul Agreement and clause 11 of the Short Haul Agreement) which, subject to some exceptions, would allow the AFAP to represent its members in relation to disputes and grievances about matters arising under the Agreements and, ultimately, to have them arbitrated by the Commission or (in the cases of grievances under the Long Haul Agreement) a Board of Appeal. This is a matter weighed by the Deputy President in paragraph [265] of the decision.

(3) As the Deputy President found in paragraph [270], the AFAP would have a statutory right equal to that of the AIPA to participate in future enterprise bargaining, and would be able to bring to bear its extensive industry-wide experience and knowledge in negotiating beneficial enterprise agreements for pilots in this respect.

(4) The Deputy President made the important finding in paragraph [267] that, while he accepted that the AIPA had negotiated “gold standard” and industry-best conditions of employment for Qantas pilots, he was satisfied that the AFAP would have achieved comparable outcomes had it historically had the requisite coverage of such pilots. In other words, the “gold standard” achieved by the AIPA was not the result of any intrinsic superiority in representational effectiveness which it held over the AFAP but rather a function of the fact that it had historically covered Qantas pilots and the AFAP had not. This finding was not challenged in the AIPA’s appeal.

(5) The Deputy President found that the AFAP’s industry-wide knowledge and perspective might, in some contexts, give it an advantage over the AIPA in relation to representing Qantas pilots in disputes, grievances and bargaining. The AIPA deprecated the significance which the Deputy President assigned to this consideration, but it did not challenge the underlying finding of fact that the AFAP derived knowledge and experience from its wider industry coverage which the AIPA might not have. This was clearly a relevant consideration, and the weight to be assigned to it was a matter for the Deputy President.

(6) The AFAP’s industry-wide coverage meant that a pilot could retain AFAP membership, and the associated benefit of enhanced MBF loss of licence insurance, when moving in employment from one business to another (including between different businesses in the Qantas Group). While the Deputy President (in paragraphs [278] and [279]) did not assign much weight to these matters, they nonetheless operated cumulatively upon the other matters.

[45] There is no mathematical calculus by which the various competing matters to which we have referred may be assigned a point score to assess whether or not the AIPA is a “better organisation” than the AFAP for the purpose of s 158(4). There is clearly room for different points of view. It may be accepted that an alternative conclusion may be available whereby the AIPA’s existing constitutional coverage of Qantas pilots, its membership of over 90 percent of such pilots, its achievement of “gold standard” conditions of employment, its entrenched role in controlling or conditioning managerial decision-making in respect of a range of matters of importance to Qantas pilots, its accumulated resources and expertise, and its long history of sound representation and probity, render it the organisation to which Qantas pilots may more conveniently belong and which would more effectively represent them. However, the evaluative judgment under s 158(4) was one for the Deputy President to make, and we are not persuaded that he erred in reaching the conclusion that he did. Appeal grounds 2 and 3 are therefore rejected.

The discretion ground

[46] The AIPA’s appeal ground 4 raises three issues for consideration. The first is whether the Deputy President gave consideration, or appropriate weight, to “the demarcation disputes that would be created by the grant of the application”. The “demarcation disputes” to which the AIPA refers in this context concern a dispute about whether the Agreement rights currently conferred exclusively on the AIPA by the Long Haul Agreement and the Short Haul Agreement should at some future time be shared with the AFAP. We have some doubt as to whether a dispute of this nature would fall within the definition of the expression “demarcation dispute” in s 6 of the RO Act, as the AIPA contends, since any claim by the AFAP for some or all of those rights to extend to it would presumably only be advanced in the context of bargaining for a future long haul and/or short haul enterprise agreement and thus would at most only give rise to a bargaining dispute between the AFAP and Qantas if Qantas resisted the claim, or perhaps a bargaining dispute between the AIPA and Qantas if Qantas was prepared to accede to the claim.

[47] In any event, the substance of the AIPA’s case in this respect was clearly considered by the Deputy President in paragraph [301] of the decision, which we have quoted in full above, and in paragraphs [303] and [304], to which reference has been made. We do not accept therefore that the Deputy President failed to have regard to this issue. As to the issue’s significance, we observe that the case advanced at first instance by the AIPA in this respect appears to have been somewhat contradictory: on the one hand, it pointed to the prospect of serious “demarcation disputes” in the future between the AIPA and the AFAP over the question of whether the AFAP should share in the exercise of the Agreement rights, but on the other it contended that the AIPA would retain the Agreement rights indefinitely and that the AFAP would remain in a permanently inferior and secondary role. It is not apparent to us how both those scenarios could simultaneously occur. In any event, the Deputy President declined to speculate as to the future course of any bargaining with respect to the Agreement rights, which we consider was a course available for him to take having regard in particular to the fact that nominal expiry dates of the Long Haul Agreement and the Short Haul Agreement are not until June 2024 and August 2023 respectively. Although there is certainly room for a different view, we likewise consider that the Deputy President’s associated conclusion that the AIPA and the AFAP would be likely to act in a cooperative and productive manner in the best interests of their members was reasonably available having regard to the evidence showing a historical absence of any materially damaging demarcation disputes between the two unions and/or other unions representing pilots in current areas of shared coverage. The AIPA’s contention that the Deputy President failed to give “appropriate weight” to the “demarcation disputes” that the grant of consent to the alteration would cause is not, in truth, a proper contention of appealable error but rather no more than a complaint that the Deputy President did not make the evaluative assessment which the AIPA preferred.

[48] The second issue is the Deputy President’s finding that the AFAP would, by providing competition to the AIPA and keeping the AIPA “on their toes and honest”, benefit Qantas pilots in terms of the “quality of services” provided to them. This is a contestable proposition, and its predicate appears to be that “competitive unionism” is, at least in some circumstances, of benefit to the industrial interests of employees. An alternate view is that “competitive unionism” is an oxymoron, that unions in competition with each other necessarily divert resources away from the effective representation of their members and tend to take more extreme positions than would otherwise be the case for the purpose of attracting and retaining members, that the requirements of the RO Act concerning internal democratic control and the proper governance of unions are the appropriate and effective means to keep unions “on their toes and honest”, and that the essential function of unions is to ensure the unity of labour in a given area of employment rather than simply to “provide services” in a hypothetical competitive market. However, as stated in paragraph [6] above, s 5 of the RO Act does not disclose any legislative policy preference for or against “competitive unionism”, and s 158 itself clearly contemplates that, subject to the requirements of the section itself being met, it may be possible for more than one organisation to obtain coverage in a particular area of employment. In that context, we consider that it was open for the Deputy President to form the value judgment that competition at least between the AIPA and the AFAP would be of benefit to Qantas pilots notwithstanding that the AIPA, on the Deputy President’s own findings, appears to have an outstanding and unblemished record of providing effective industrial representation to such pilots. The appeal process is not an opportunity for us to substitute whatever value judgment we might make about this issue for that of the Deputy President.

[49] The third issue concerns the Deputy President’s finding that “a number” of Qantas pilots would join the AFAP if it obtained consent to the alteration. This was not an irrelevant consideration, given that the AIPA’s own case concerning the exercise of the discretion relied to a substantial degree upon its own membership numbers amongst Qantas pilots. We also observe that the AIPA’s case in this respect was again beset by an internal contradiction: on the one hand, it contended that there was a lack of evidence that any Qantas pilots wanted to join the AFAP apart from a small number of “legacy” members who had moved to Qantas from other airlines and wished to retain their MBF loss of licence insurance but, on the other hand, it contended at first instance that the grant of consent to the alteration would cause the AIPA to have an “existential crisis”. In any event, we consider that the Deputy President was entitled to make the limited finding which he did about this matter on the basis of the evidence which he identified in paragraph [294]. On our reading of the decision, the question of the number of Qantas pilots who might join the AFAP if consent was granted to the alteration was a matter given only minor weight by the Deputy President in his exercise of the general discretion, and we do not therefore accept that any appealable error arises on the basis that he gave this matter “too much weight” as contended by the AIPA.

[50] For these reasons, appeal ground 4 is also rejected. Having not upheld any of the appeal grounds, we consider it is necessary to dismiss the appeal.

Orders

[51] We order as follows:

(1) Permission to appeal is granted.

(2) The appeal is dismissed.

VICE PRESIDENT

Appearances:

Mr M Irving QC with Mr M Slevin of counsel for the AIPA.
Mr C Dowling SC with Mr J Fetter of counsel for the AFAP.
No appearance for the TWU.

Hearing details:

2021.
Sydney, Melbourne and Adelaide (via video-link):
21 April.

Printed by authority of the Commonwealth Government Printer

<PR730551>

 1   [2021] FWC 1012

 2   Ibid at [32](b)

 3   Ibid at [75]-[101]

 4   Ibid at [173]-[174]

 5   Ibid at [176]

 6   Ibid at [177]

 7   Ibid at [178]

 8   Ibid at [182]-[183]

 9   Ibid at [184]

 10   Ibid at [185]

 11   Ibid at [186]-[255]

 12   Ibid at [258]

 13   Ibid at [260]

 14   Ibid

 15   Ibid at [265]

 16   Ibid at [268]-[269]

 17   Ibid at [271], [273]

 18   Ibid at [272]

 19   Ibid at [275]-[276]

 20   Ibid at [277]-[279]

 21   Ibid at [292]

 22   Ibid at [293]-[294]

 23   Ibid at [295]

 24   Ibid at [297]

 25   Ibid at [298]-[299]

 26   Ibid at [300]

 27   Ibid at [302]

 28   Ibid at [303]-[306]

 29   Ibid at [311]-[315]

 30   Ibid at [316]-[320]

 31   Ibid at [321]

 32   Coal and Allied v AIRC [2000] HCA 47, 203 CLR 194 at [19]-[20] per Gleeson CJ, Gaudron and Hayne JJ

 33   [1936] HCA 40, 55 CLR 499 at 505 per Dixon, Evatt and McTiernan JJ

 34   See NTEU v CPSU [1999] AIRC 1296, 93 IR 365 at [212]-[213]