This publication is intended as a first point of reference and should not be relied on as a substitute for professional advice. Specialist legal advice should always be sought in relation to any particular circumstances.
The recent case involving the Transport Workers Union of Australia (TWU) and employer JJ Richards & Sons Pty Ltd (JJR) in Fair Work Australia (FWA) gives unions power to use protected industrial action in order to drive an employer to enter into bargaining in circumstances where the formal bargaining regime under the Fair Work Act 2009 (Cth) (FW Act) has not commenced.
The facts
JJR subcontracted garbage collection in New South Wales for the Canterbury City Council. The New South Wales TWU wrote to JJR seeking to engage in bargaining. JJR rejected this request. The NSW TWU lobbied the Canterbury City Council, which passed a motion that JJR would seek to negotiate with the TWU. JJR wrote to the Council refusing to bargain. The Federal TWU then applied to Fair Work Australia for a Protected Action Ballot Order (PABO).
At first instance, Commissioner Harrison concluded that the TWU had been 'generally trying to reach an agreement' with JJR and granted the application for a PABO.
JJR appealed the decision to the FWA Full Bench in December 2010, arguing that protected industrial action can be taken only once the formal bargaining process under the FW Act has commenced. Specifically, JJR argued that a PABO is an incorrect mechanism to use in order for the union to achieve its intentions of seeking to bargain with the employer. Lead employer associations also intervened in the proceedings.
Vice President Lawler and Commissioner Bissett found that the legislature did not intend that a Majority Support Determination (MSD) be the only mechanism by which an employer who refuses to bargain can be compelled to bargain. They found that protected industrial action should be available as an alternative mechanism to compel such an employer to bargain. Senior Deputy President O'Callaghan dissented.
Ultimately, FWA upheld the appeal on a technicality regarding the identity of the union.
The New South Wales TWU then brought a separate PABO application before Commissioner Harrison on 16 February 2011 on similar grounds to the original application by the Federal TWU. Commissioner Harrison found that: 'In my opinion the Act [FW Act] does not require a bargaining agent to seek a majority support determination, good faith bargaining orders, or scope orders as a prerequisite to seeking a protected action ballot order where an employer refuses to commence bargaining.'
The implications
FWA has set a low threshold for unions to demonstrate that they are genuinely trying to reach an agreement with an employer in order to bring a PABO and take subsequent protected industrial action.
According to the Full Bench in the JJR case, the fact that bargaining has not formally commenced under the Fair Work Act is not a barrier to unions obtaining authorisation to take protected industrial action.
Employers should be wary of unions and particularly the TWU in threatening protected industrial action in circumstances where employers refuse to bargain. They should always consider contesting any FWA application brought by the union.
The approach of FWA still seems to be unsettled given the tension between the decision of the FWA Full Bench in the JJR case and other Full Bench decisions in relation to whether FWA can authorise protected action prior to the commencement of bargaining.
DLA Phillips Fox has successfully represented a number of employers in key decisions concerning unions and their innovative approaches to furthering their industrial agendas on major projects and worksites around Australia. See for example Douglas Heath v Gravity Cranes Services Pty Ltd [2010] FWA 7751.
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