[2008] AIRCFB 24 [2008] AIRCFB 24 PR980373 Download Word Document AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION Workplace Relations Act 1996 s.120 appeal against Order [ PR978525 ] and Decision [[2007] AIRC 810] issued by Senior Deputy President Cartwright on 19 September and 24 September 2007 Australian Workers Union and BlueScope Steel Limited (C2007/3648) Cartwright SDP: BlueScope Steel Limited and The Australian Workers Union (C2007/3567) Metal industry VICE PRESIDENT LAWLER SENIOR DEPUTY PRESIDENT HAMBERGER COMMISSIONER THATCHER SYDNEY, 15 JANUARY 2008 Appeal - definition of industrial action in s.420 - exclusion in paragraph s.420(1)(b) - 21st shift of a roster worked as voluntary overtime - employer accepted ‘right’ of employees to decline to work 21st shift - coordinated and collective refusal by employees to volunteer for 21st shift - whether employer “authorised or agreed to” action. DECISION [1] This is an appeal by The Australian Workers Union against an order 1 on 19 September 2007 and a decision 2 on 24 September 2007 of Senior Deputy President Cartwright. The order was an order pursuant to s.496 of the Workplace Relations Act 1996 prohibiting industrial action for a period and was directed to the AWU and certain employees of BlueScope Steel Limited (" BlueScope "). [2] The employees in question work at BlueScope’s Metal Coating Lines Department facility at Port Kembla. The facility operates on a rotating four shift continuous roster. The employees are grouped into four crews: A, B, C and D. The roster for each crew has 21 shifts. The first 19 shifts of each roster represent ordinary time and the 20th shift is worked as compulsory overtime. The 21st shift is referred to by the parties as a “leisure day”. BlueScope is not obliged to offer work for the 21st shift and the employees are not obliged to accept work when it is offered. Thus, when employees work the 21st shift they work it as voluntary overtime. BlueScope has refrained from directing or otherwise requiring employees to work the 21st shift. [3] The Senior Deputy President made the following findings: “[6] The evidence establishes, however, that the 21st shift for all four crews has been manned and operated at least since December 2005, when Mr Bergner became manager of the Department. Mr Bergner gave evidence that 21 operators typically made themselves available and worked the 21st shift. [7] The first time this did not occur was the B crew 21st shift on 6 September 2007. Over the previous year, the number of B crew operators working the 21st shift was: 20, 21, 21, 19, 23, 20, 21, 25 and 22. For 6 September, of the 25 B crew operators not on scheduled leave, 0 accepted or offered for work, in contrast to the previous month when 21 of those same people had worked the 21st shift on 9 August. [8] The day that B crew did not work the 21st shift, 6 September, a meeting was held at the AWU office, attended by Mr Gorman of the AWU and delegates and members of each crew, including Mr Wieck, the C crew AWU delegate. The meeting discussed BlueScope’s proposed restructure in the MCL, a matter in dispute. BlueScope had proposed to increase manning of the coating line shift crews, with the anticipated effect of spreading shifts now worked on overtime across a greater number of employees working ordinary hours. Mr Wieck’s evidence was that the change in manning would cost people a lot of money. He also gave evidence of dissatisfaction at BlueScope’s change from approving single days’ leave to requiring annual leave to be taken for a minimum of 4 days at a time. [9] Mr Bergner gave evidence of being told by employees that each crew would take its turn in not working the 21st shift, on the basis that the four crews share equal pain – not a novel proposition in the Commission.” [4] The Senior Deputy President accepted and acted upon the evidence of Mr Bergner. His Honour also referred to and accepted evidence of “a pattern of unprotected industrial action at the site”. 3 His Honour concluded: “[16] In my view, there was no suggestion of a general overtime ban, but the evidence was consistent with there being an understanding that C crew members would not offer for or accept work on the regular 21st shift scheduled for 20 September. ... [18] I was satisfied on the evidence that the wholesale refusal of the regular 21st shift, customarily worked as overtime, was a limitation on the acceptance of or offering for work by employees. It was industrial action as defined by the Act. It was not and could not be argued that it would be protected action. [19] Accordingly, it appeared to the Commission on 19 September that industrial action by employees that would not be protected action was impending. Also, it appeared to me that further industrial action that would not be protected action is probable on 4 October and 13 December, when D and A crews are next due for the 21st shift. [20] Having come to this view, I was required by s.496 of the Act to issue an order that the industrial action not occur and not be organised. I did so, with effect from 8 pm on 19 September.” [5] With some minor exceptions that do not bear upon the outcome of this appeal, counsel for the AWU did not seek to challenge the factual findings of the Senior Deputy President. Moreover, counsel for the AWU acknowledged that the fact that all bar one employee elected not to work the 21st shift suggests more than simply a coincidence. (The one employee who volunteered for the C crew’s 21st shift on 20 September 2007 had just returned from leave and may have been unaware of the agreement or understanding between employees that none would volunteer to work the 21st shift. 4 ) An inference could properly be drawn that the relevant employees had reached an understanding that they would all refuse to volunteer for the 21st shift and gave effect to that understanding in way that was coordinated and collective. [6] His Honour summarised the argument of the AWU as follows: “[15] Mr Gorman submitted that the employees were aware that unprotected industrial action was prohibited, but that declining to work the 21st shift, which was not a mandatory overtime shift, could not be characterised as industrial action as defined by s.420 of the Act. This was a voluntary shift where it was up to each individual to decide whether or not to work and a decision not to work, in circumstances where operators were already working large amounts of overtime and BlueScope had not offered this shift to all other employees, was not industrial action within the meaning of s.420.” [7] The expression “industrial action” is defined in s.420. Relevantly for present purposes, s.420 provides: “ 420 Meaning of industrial action (1) For the purposes of this Act, industrial action means any action of the following kinds: (a) the performance of work by an employee in a manner different from that in which it is customarily performed, or the adoption of a practice in relation to work by an employee, the result of which is a restriction or limitation on, or a delay in, the performance of the work; (b) a ban, limitation or restriction on the performance of work by an employee or on the acceptance of or offering for work by an employee; (c) a failure or refusal by employees to attend for work or a failure or refusal to perform any work at all by employees who attend for work; ... but does not include the following : (e) action by employees that is authorised or agreed to by the employer of the employees ; ... Note 2: The issue of whether action that is not industrial in character is industrial action was considered by the Commission in Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v The Age Company Limited , PR946290 . In that case, the Full Bench of the Commission drew a distinction between an employee who does not attend for work in support of a collective demand that the employer agree to alteration of the conditions of employment as being clearly engaged in industrial action and an employee who does not attend for work on account of illness. (2) For the purposes of this Act: (a) conduct is capable of constituting industrial action even if the conduct relates to part only of the duties that employees are required to perform in the course of their employment; and (b) a reference to industrial action includes a reference to a course of conduct consisting of a series of industrial actions.” (underline emphasis added) [8] There can be no doubt that the coordinated and collective refusal of employees to volunteer to work their 21st shift was industrial action within the ordinary industrial usage of that expression. A collective refusal to work overtime is a classic example of industrial action in that sense. However, the expression “industrial action” is defined in the Act. In any given case, the Commission is concerned with whether the action is industrial action as defined. Section 420 identifies in paragraphs (e) to (g) kinds of action that are expressly excluded from the meaning of the expression “industrial action”. Accordingly, if any given action falls within one of those exclusions it cannot be industrial action for the purposes of s.496. [9] In Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v The Age Company Limited 5 (" Age Case ") the Full Bench was concerned with whether certain conduct by an employer, n apparent breach of a certified agreement, amounted to “industrial action” within the meaning of the definition of that expression in s.4 of the pre-reform Act. The definition in s.420 is, clearly enough, based on the old definition in s.4. The two definitions share the same structure and the operative portions of a number of the paragraphs in the two definitions are identical. The terms of note 2 to s.420 are an endorsement by the legislature of the approach of the Full Bench in the Age Case as being applicable to proper construction of s.420. [10] In the Age Case the Full Bench reviewed the authorities and took the view (albeit as obiter dicta ) that there was much to be said for the proposition that action falling within the definition must be industrial in character. 6 The Full Bench opined that context and motive were relevant to determining whether particular conduct amounted to industrial action within the meaning of s.4: “An employee who does not attend for work on account of illness may not be engaging in industrial action, while an employee who does not attend for work in support of a collective demand that the employer agree to alteration of conditions of employment clearly is so engaged. ... It seems to us likely that the legislature did not intend to include conduct which stands completely outside the area of disputation and bargaining and that accordingly the definition should be read giving some weight to the word industrial. But precisely how far this qualification might extend is a question of degree.” 7 [11] We adopt that approach in relation to the definition of “industrial action” in s.420. [12] The evidence established that the employer accepted that the employees have a right to decline to volunteer to work the 21st shift of their rosters. This was acknowledged by the advocate for BlueScope in submissions 8 and was admitted in terms by Mr Bergner, the manager of the facility: 9 “MR GORMAN: Mr Bergner in his evidence stated that the 21st shift is viewed by the employees as optional. Is that correct?---The employees tell me now that it is a leisure day shift and it is an optional shift and I can decide whether I want to work or whether I don't want to work. In the company's view is that an optional shift?---It's a 21st shift that we don't say is like the painter's shift is a mandatory it is an optional shift. So the 21st shift is an optional shift?---Yes. The employees have the right to turn up or the right not to turn up and work that shift?---Typically they have shown that - - - No typically have they shown, have the employees got the option of refusing that shift if they so want?---Typically they have shown that they were. Mr Bergner, would you please answer the question?---They have got the right to say yes or no. They have the right to say yes or no, it is not a mandatory shift so if an employees says no they don't want to work that shift you must then have to respect that wish?---And we have done that.” [13] The source of the “right” acknowledged by Mr Bergner is unclear. No contracts or statutory agreements were tendered in evidence before the Senior Deputy President. [14] The issue on the appeal is whether the refusal by employees to volunteer for the 21st shift was industrial action within the meaning of the definition in s.420 of the Act and thus industrial action within the meaning of s.496. This issue turns on whether, on the evidence, the refusal by employees to volunteer to work the 21st shift was outside the definition of “industrial action” because it was “action by employees that is authorised or agreed to by the employer of the employees” within the meaning of paragraph 420(1)(e). [15] The AWU contended that, given the unqualified acknowledgment by Mr Bergner that employees had the “right” to choose not to work their 21st shift, BlueScope must be found to have authorised or agreed to employees refusing to volunteer for their 21st shift. Counsel argued that the motive for such refusal is irrelevant as is the fact that all relevant employees chose to exercise their right in this regard. [16] The applicability of the exclusion in paragraph 420(1)(e) was not considered by the Senior Deputy President in his reasons for decision. That omission involved error, either in the form of a failure to provide adequate reasons 10 or a failure to take into account a relevant consideration. 11 It is unnecessary to decide whether the criterion in s.120(2) is made out because, error having been established, we are satisfied that leave to appeal should be granted pursuant to the discretion in s.120(1). We grant leave to appeal and, accordingly, the appeal proceeds as a rehearing. 12 [17] Paragraphs 420(1)(a) to (d) are the “kinds” of action that can constitute “industrial action” provided such action is not within the exclusions in paragraphs 420(1)(e) to (g). Thus, it is necessary to properly characterise the impugned action and then to determine that it falls within one or more of the kinds of action specified in paragraphs 420(1)(a) to (d) before a determination can be made as to whether the action so characterised also comes within one of the exclusions in paragraphs 420(1)(e) to (g). In particular, the applicability of the exclusion in paragraph 420(1)(e) depends upon properly characterising the “action” that the employer is said to have “authorised or agreed to”. [18] The advice conveyed to Mr Bergner after the meeting at the AWU office can properly be described as amounting to notification of a ban on voluntary overtime in the form of the 21st shifts even if those words were not used. At the very least, the action in this case was a coordinated and collective limitation on the acceptance of or offering for work by employees, namely voluntary overtime constituted by the 21st shift, and was therefore action of a kind coming within paragraph 420(1)(b). It had the effect that employees who would ordinarily volunteer for overtime did not do so (and, as such, undoubtedly had an industrial character). While the matter is not without some difficulty, we think the better view is that BlueScope could not be said to have authorised or agreed to that action. The action in this case was not merely a case of employees choosing to exercise their “right” to decline to work the 21st shift. Here, an essential feature of the action was that this occurred pursuant to an understanding between the employees and in a way that was coordinated and collective. While BlueScope could be said to have authorised individual employees not to volunteer for overtime it could not be said to have authorised or agreed to a coordinated and collective refusal of voluntary overtime constituted by the 21st shift. [19] It follows that the exclusion in paragraph 420(1)(e) is not made out and the Senior Deputy President was correct in concluding that the jurisdictional requirements in s.496(1) were made out and thus correct in concluding that an order must issue. [20] We think it desirable to note three matters. [21] First, Mr Bergner’s admission that employees had a “right” to decline to work the 21st shift may not have been properly made because it is not in dispute that the relevant award contains a clause that entitles the employer to require employees to work reasonable overtime. In the absence of a workplace agreement made under the Act that overrides this clause, it continues to bind the parties and BlueScope would be entitled to rely upon it to require employees to work the 21st shift (provided the overtime involved could, in the circumstances, be regarded as reasonable overtime) - and this would be so irrespective of any general law contractual term to the contrary. [22] Secondly, this decision has nothing to do with the merits of the underlying dispute. It is alleged that the proposed rostering changes that provoked the action that in turn led to the order in this case will result in a general reduction of rostered overtime for all employees. This could well have the result that employees will earn significantly less income than that to which they have become accustomed. Thus, from an industrial perspective, the employees may well have a genuine grievance. However, the duty of the Commission is to apply the Act. The legislature has seen fit to remove the discretion that the Commission once had to refrain from making orders of the sort for which s.496 provides. The fact that industrial action may be an understandable industrial response to a genuine grievance over action proposed or taken by an employer is almost always irrelevant to whether an order should issue under s.496. 13 [23] Thirdly, the order as issued by the Senior Deputy President requires the AWU and employees not to engage in industrial action and requires employees to “immediately be available for work, and perform work as required by [BlueScope] in accordance with the Award and their contract of employment” . If employees have a right to decline to volunteer for the 21st shift, then an exercise of that right by an individual employee for reasons other than industrial reasons will not amount to participation in industrial action by that employee or to a breach of the order. Proof that any given employee is, by declining to volunteer for their 21st shift, engaging in industrial action may be a difficult matter from a practical perspective. However, that is an issue going to enforcement of the order and thus is a matter for the Court and not the Commission. [24] The AWU also contends that even if (contrary to its arguments) the Senior Deputy President was correct in finding that industrial action was impending or probable, his Honour nevertheless erred in making an order that bound the AWU because there was no evidence and no finding that the AWU had taken or organised the action. We disagree. [25] Once the Commission has found that the jurisdictional requirements in s.496(1) have been satisfied it must make an order. The decision of the Full Bench in Transport Workers Union v TNT Australia Ltd 14 is authority for the proposition that while it is open to the Commission to make an order that is confined to relevant employees and does not extend to a union that represents those employees (or vice versa), it is nevertheless also open to the Commission to make an order that extends to the union, even though there is no jurisdictional finding of fact against the union, if, on the evidence and in the judgment of the Commission, such an order is desirable as having a rational or logical tendency to stop or prevent the industrial action. 15 In the present case there was in fact evidence from which an inference of union involvement in, or support for, the action could be drawn. The advice to Mr Bergner that each crew would take its turn in not working the 21st shift came immediately after a meeting at the AWU office of delegates and members of each crew at which the AWU organiser was present that addressed concerns over proposed changes to the rostering arrangement at the BlueScope facility. It stretches credulity to suppose that the two events are unconnected or that what was conveyed to Mr Bergner was something different from that which had been decided at the meeting. We can see no basis for disturbing the Senior Deputy President’s conclusion that the order in this case should extend to the AWU. [26] For the reasons we have given we grant leave to appeal but dismiss the appeal. BY THE COMMISSION: VICE PRESIDENT Appearances: I Taylor of counsel for the Australian Workers Union Mr D Lloyd , solicitor, with T Sebbens , solicitor, for BlueScope Steel Limited Hearing details: 2007. Sydney. November 28. Printed by authority of the Commonwealth Government Printer <Price code C> 1 PR978525 2 [2007] AIRC 810, PR978532 3 Para [14] 4 AB27 5 PR946290 (Giudice J, Harrison SDP and Simmonds C, 11 May 2004) 6 PR946290 at paras [39], [42] and [46] 7 PR946290 , paras [44] and [46] 8 AB14, PN43 9 AB26 at PN140-PN146 10 See for example Confectionery Workers Union v Australian Chamber of Manufactures (1991) 38 IR 49 at pp.52-53 and Mappas v TAAU Australia Pty Ltd (2007) 161 IR 240 at para [12] 11 House v The King (1936) 55 CLR 499 at 504 per Dixon, Evatt and McTiernan JJ 12 Coal and Allied Operations Pty Ltd v AIRC (2000) 203 CLR 194 at [17] and [32] 13 Industrial action taken during a bargaining period that is responsive to the protected action taken by the employer can be protected action (see .435(2)) and thus not action that can found an order under s.496. 14 (2006) 154 IR 256 15 (2006) 154 IR 256 at paras [6] - [10], [13] - [14]