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Federal Court of Australia |
Last Updated: 24 March 2000
CFMEU v Master Builders' Association of Victoria (No 2) [2000] FCA 169
INDUSTRIAL RELATIONS - ban on overtime - protected action - "lock out" - whether lock out falls within s 170ML(3) and (4) of the Workplace Relations Act 1996 (Cth) - comparison of "strike" and "lock out" - employers preventing employees from working overtime - no right to work overtime in contract of employment.
WORDS & PHRASES - "lock out"
Workplace Relations Act 1996 (Cth): s 170ML, s 170MT
Lennie v Hawks (unreported, Marshall J, 4 October 1996) cited
Niceski v Dowell Australia Ltd (1981) 52 FLR 371 cited
McKernan v Fraser [1931] HCA 54; (1931) 46 CLR 343 cited
Kidd v Savage River Mines (1984) 6 FCR 398 discussed
Amalgamated Society of Engineers (Perth Branch) v Millars' Karri and Jarrah Co (1902) Ltd (1907) 9 WAR 207 considered
CONSTRUCTION FORESTRY MINING AND ENERGY UNION v MASTER BUILDERS' ASSOCIATION OF VICTORIA & ORS (No 2)
V 59 of 2000
GOLDBERG J
17 MARCH 2000
MELBOURNE
IN THE FEDERAL COURT OF AUSTRALIA |
|
VICTORIA DISTRICT REGISTRY |
1. The question set down for separate determination:
"Whether the Respondents' conduct pursuant to the notices comprising exhibit TCB6 to the affidavit of Toby Carl Borgeest affirmed on 16 February 2000 is protected action under s 170MT of the Workplace Relations Act 1996 (Cth)"
is answered:
"Yes".
2. A directions hearing be held at 9.30 am on 21 March 2000 to determine whether any, and if so, what consequential orders and directions should be made and given as a result of the answer to the question.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
IN THE FEDERAL COURT OF AUSTRALIA |
|
VICTORIA DISTRICT REGISTRY |
JUDGE: |
GOLDBERG J |
DATE: |
17 MARCH 2000 |
PLACE: |
MELBOURNE |
1 The applicant Construction Forestry Mining and Energy Union ("the Union") has commenced a proceeding against the Master Builders' Association of Victoria ("the MBAV") and eight construction companies seeking declaratory relief in relation to industrial action taken by the Union and bans on working overtime imposed by the construction companies and seeking injunctive relief restraining the MBAV from procuring, and the construction companies from imposing, bans on working overtime. The Union also seeks an injunction restraining six of the construction companies from taking certain proceedings against the Union, its officers, employees and members, and it claims compensation and damages.
2 The matter for immediate determination arises out of the application by the Union for an interlocutory injunction restraining the MBAV and all respondent construction companies from procuring or imposing bans on working overtime. When the application for interlocutory relief came on for hearing on 18 February 2000 I heard argument on the issue whether the fourth to ninth respondents should be restrained from commencing legal proceedings against the Union, its officers, employees and members pending the final hearing of the proceeding and I reserved my decision on that matter. (I published my reasons for judgment in respect of that matter on 25 February 2000 [2000] FC 168). On the same day I ordered, pursuant to O 29 r2 of the Federal Court Rules, that the following separate question be set down for hearing:
"Whether the Respondents' conduct pursuant to the notices comprising exhibit TCB6 to the affidavit of Toby Carl Borgeest affirmed on 16 February 2000 is protected action under s 170MT of the Workplace Relations Act 1996 (Cth)".
Those notices by each of the respondent construction companies, dated 10 February 2000, directed their employees not to attend for, or perform any, work at specified times. They were sent to the Union under cover of a letter from the MBAV dated 11 February 2000 which was in the following terms:
" NOTICE OF INTENDED LOCKOUTWe act as agents for a number of building and construction companies.
We refer to the notification previously forwarded to you via facsimile and registered mail on or about 2 February 2000 in relation to the proposed lockout of our employees to commence on Tuesday 8 February 2000. We ask that you disregard that document and treat the contents contained herein as replacing the original.
Those in respect of whom we act wish to express their disappointment with the current demands of the CFMEU for the new certified agreement to apply to their employees.
The MBAV have conducted the negotiations in good faith with a genuine interest in providing a basis for the viable continuation of the businesses of those we represent that will secure jobs for their employees. They simply cannot afford to accede to demands for a 36-hour week and a 24% pay rise over 3 years. Bans, limitations and stoppages by the CFMEU and its members are occurring throughout the State and are getting worse. The CFMEU and members of the CFMEU are even making demands to be paid for periods of industrial action when their members do not work, which is unlawful under section 187AB of the Workplace Relations Act 1996.
You are using industrial action in support of your claims and in the circumstances those we represent have no alternative but to exercise their entitlement to lockout those of their employees who will be covered by the proposed certified agreement, to advance our claims for a 38-hour week and a percentage wage rise of no more than the N.S.W. 3-year 15% deal.
Please find enclose notices of protected action pursuant to section 170MO of the Workplace Relations Act 1996.
The lockout action is taken during the bargaining period which was initiated by the CFMEU. The lockout applies in Victoria only."
The notices were substantially in common form. The differences between them are not relevant or material for present purposes. The form of one notice will suffice:
" Notice of Protected Action
(Pursuant to section 170M) Hooker Cockram Limited
004 282 599
and
CFMEU
and
All employees whose employment will be subject to the proposed certified agreement
In accordance with Section 170MO(3)(a)(i) of the Workplace Relations Act 1996, Hooker Cockram Limited gives you notice of protected action in the form of a lockout of all employees whose employment will be subject to the proposed certified agreement.
All persons to whom this notice applies are directed not to attend for or perform any work:
§ Before 7am or after 3:30pm Monday to Friday; or
§ At any time on any Saturday; or
§ At any time on any Sunday,
In the 6 week period commencing Saturday, 12 February 2000 and concluding Saturday, 25 March 2000. These dates are inclusive.
The lockout will commence at 12:01am on Saturday 12 February 2000 and will continue until midnight on Saturday, 25 March 2000. The lockout relates to the bargaining period instituted by the CFMEU."
The notices, do not, in terms refer to "overtime" as such, nor do they refer, in terms, to the banning of overtime. However, there was no issue between the parties that the effect of the notices was to ban the working of overtime and to indicate to employees that overtime work would not be offered during the relevant period.
Background
3 This proceeding and the application for interlocutory relief is but another stage of an industrial dispute which has been ongoing in the building construction industry for some considerable time.
4 The Union and the second to ninth respondents ("the employers") and the subcontractors retained by the employers to work on building sites are bound by the National Building and Construction Industry Award 1990 ("the Award") made under the Workplace Relations Act 1996 (Cth) ("the Act") by the Australian Industrial Relations Commission ("the Commission"). Over the past three years the Union has entered into certified agreements with many building contractors in the building construction industry, which agreements have been registered with the Commission under the provisions of the Act. Most of those certified agreements passed their nominal expiry date by 30 November 1999 but in accordance with s 170LX of the Act they remain in operation until replaced by another certified agreement.
5 Since October 1999 the Union has been engaged in an industrial campaign to obtain a thirty-six hour working week and a nine day fortnight and a pay increase of 24% over three years. The MBAV and the employers in the building construction industry have resisted these claims. Negotiations commenced in October 1999 between representatives of the MBAV, a body representative of the interests of a number of large construction companies, the Construction Employers' Planning Forum ("the CEPF") and the Union.
6 On 7 December 1999 the Union served notices on the employers who were parties to the certified agreements which had passed their nominal expiry date, pursuant to the provisions of s 170MI, initiating a bargaining period and giving notice of intention to try to make a new agreement. The notices set out the matters which the Union proposed should be dealt with by the proposed agreements which included, relevantly for present purposes, a thirty-six hour week to be worked over a nine day fortnight.
7 Subsequent to the service of the notices, negotiations have been conducted between the Union, the MBAV and the CEPF. Those negotiations have not yet led to any agreement between any of the parties.
8 On 5 January 2000 the Union gave notices to the employers, with whom agreements had expired, of the intention of officers, employees and members of the Union to take industrial action. The notices were given in accordance with s 170MO of the Act. Subsequent to 11 January 2000 members of the Union have taken industrial action in accordance with those notices. The industrial action specified in the notices included, inter alia, rolling bans and bans on various aspects of construction activity. These bans and strikes have affected the employers at their construction sites and the employers claim to have suffered significant losses which are continuing as a result of the strikes and work bans imposed by the Union and its members.
9 On 9 February 2000 the MBAV held a meeting of approximately 250 building contractors who were its members at which a resolution was passed to implement a ban on overtime commencing from 12 February 2000. The resolution and the circumstances are recorded in a media release from the MBAV in the following terms:
" BUILDING INDUSTRY UNITED AGAINS UNION CLAIMSThe Master Builders Association of Victoria (MBAV) today announced that the commercial building industry had banded together to fight the union campaign for a 36 hour week and a 24 per cent pay increase.
`More than 250 builders and subcontractors representing over 70 per cent of the industry met today and independently resolved that they would resist the union campaign for a shorter working week and further pay increases,' said Brian Welch, Executive Director of the MBAV.
`The industry has resolved to implement an overtime ban commencing from Saturday, 12 February.
`Workers on various sites will be given notice of the `lockouts' and notified that if they turn up for work they will not be paid.
Similarly sites will operate from the core hours of 7.00 am to 3.30 pm Monday to Friday and there will be no overtime worked out of those hours.
`We have no other option but to take this action. The industry has its back to the wall on this issue. It simply cannot afford the increased costs that the union claims would impose upon it, particularly when economic forecasters agree that the industry is heading for a downturn,' Mr Welch said.
`The industry is prepared to give unions a fifteen per cent pay rise - in line with conditions in New South Wales and Queensland. It is not prepared to buckle to wage demands and shorter hours that would price Victoria out of the construction market.
`The unions are doing untold damage to Victoria's reputation as a reliable State to do business. They are dragging the State back to the bad old days of the 1980s when the unions ran riot and the claims of an overpaid few held the public interest to ransom. If the unions win, Victoria loses,' Mr Welch said."
The ban on overtime is being implemented by each employer in the terms of the notices dated 10 February 2000 sent to the Union on 11 February 2000.
10 The employers claim that the conduct specified in each of the notices is "protected action" within s 170ML(3) of the Act. The Union contends that the ban on overtime is not such "protected action" and the determination of that issue has been formulated as a separate question to be answered by the Court.
11 Overtime is a common and frequent feature of employment in the building construction industry although neither the Award nor the various certified agreements to which the employers are party provide for a minimum amount of overtime to be worked. The Award is enabling in this respect as cl 18(7) provides:
"An employer may require any employee to work reasonable overtime."
The following matters were led in evidence by the Union and were not contested by the respondents:
"17. Overtime is a major part of the working week of practically all employees in the building and construction industry. There are two main reasons for this.
(a) Many of the tasks associated with building projects - for example, concrete placement, the use of post tensioning cables, and the reinforcement of concrete structures and slabs - require continuous production processes. These processes cannot be completed without the relevant building contractors requiring their employees to work overtime on weekends and on weekdays.
(b) In respect of Saturday hours, it is widely understood in the industry that employers expect and require employees to attend work on Saturdays. Construction schedules, budgets and contracts are almost always drawn up on the basis of labour availability on at least a 6-day a week basis. In this context, employees in the industry would be extremely reluctant to refuse an employer request that employees work on Saturdays, as those employees would be fearful of prejudicing their prospects of future employment with the relevant employer. Accordingly, Saturday working hours could almost be described as a universal industry standard."
The following matters were led in evidence by the first, second and third respondents and were not contested by the Union:
31. Overtime is a major part of the working week of many employees in the building and construction industry. However, Saturday hours are not a universal industry standard whilst work is often available on Saturdays, this does not apply across the board to the operations of all of the MBAV's members. It varies considerably between jobs and trades.32. Overtime across sites where the MBAV's members operate varies between 6 to 14-hours per week."
It was not contested by the respondents that working overtime is a fact of life within the building construction industry and a common and frequent feature of employment in it. The Union alleged in its statement of claim that employees of the employers have worked overtime as part of their employment with those employers and this is accepted by the respondents. It was not suggested that when overtime is worked it is worked on any basis other than on, and subject to, the terms of the employees' contracts of employment.
The legislation
12 Part VIB of the Act makes provision for the making of agreements between employers and employees to be certified by the Commission. In particular, Div 2 makes provision for the Commission to certify agreements between employers who are constitutional corporations or the Commonwealth and organisations of employees or employees. Division 3 makes provision for the Commission to certify agreements between employers and employees to settle industrial disputes and to prevent industrial situations from giving rise to industrial disputes. Division 4 sets out the procedure for the certification of agreements by the Commission. Division 6 provides for the persons who are to be bound by certified agreements and, in the case of agreements certified under Div 3, the certified agreement binds the employer and the organisations of employees concerned and all members of the organisations and employees concerned: s 170MA. Division 8 recognises the need for negotiations to be entered into before agreements can be reached between employers and organisations of employees and certified and provides that during such period of negotiations certain action taken is to be "protected action". In short, provided its provisions are satisfied, Div 8 protects industrial action taken by unions and employees (s 170ML(2)) and lock outs by employers (s 170ML(3)) provided that the industrial action is taken, or the lock out occurs, for the purpose of supporting or advancing claims made in respect of the proposed agreement or for the purpose of responding to industrial action by employees, or a lock out by the employer, as the case may be.
13 The evident purpose of the procedure is to enable employers, employees and their respective representative organisations to carry on and conduct negotiations for the purpose of reaching agreement on industrial issues free, within limits, from the threat of legal proceedings in relation to certain action they may take as part of, or related to, a negotiating process.
14 The respondents rely on s 170ML(3) as providing the cover of "protected action" for what is colloquially called a "ban on overtime" and it is therefore desirable to place s 170ML(3) in its statutory context.
15 The procedure leading up to the creation of the umbrella of "protected action" is initiated by establishing a "bargaining period" pursuant to s 170MI. Any employer, organisation of employees or employee wanting to negotiate an agreement under Div 2 or Div 3 in relation to employees who are employed in a single business or a part of a single business may initiate a bargaining period for the purpose of negotiating a proposed agreement: s 170MI(1). The bargaining period is initiated by the initiating party giving written notice to the other negotiating parties of an intention to try and make an agreement and have it certified: s 170MI(2). The bargaining period begins at the end of seven days after the date on which the notice is given: s 170MK. During the bargaining period, as a result of the provisions of s 170ML and s 170MT, parties engaging in "protected action" are immune from legal proceedings in respect of that protected action.
16 Section 170ML is in the following terms:
"(1) This section identifies certain action (protected action) to which the provisions in section 170MT (which confers certain legal immunity on protected action) are to apply.(2) During the bargaining period:
(a) an organisation of employees that is a negotiating party; or
(b) a member of such an organisation who is employed by the employer; or
(c) an officer or employee of such an organisation acting in that capacity; or
(d) an employee who is a negotiating party;
is entitled, for the purpose of:
(e) supporting or advancing claims made in respect of the proposed agreement; or
(f) responding to a lockout by the employer of employees whose employment will be subject to the agreement;
to organise or engage in industrial action directly against the employer and, if the organisation, member, officer or employee does so, the organising of, or engaging in, that industrial action is protected action.
(3) Subject to subsection (6), during the bargaining period, the employer is entitled, for the purpose of:
(a) supporting or advancing claims made by the employer in respect of the proposed agreement; or
(b) responding to industrial action by any of the employees whose employment will be subject to the agreement;
to lock out from their employment all or any of the employees whose employment will be subject to the agreement and, if the employer does so, the lockout is protected action.
(4) The reference in subsection (3) to the employer locking out employees from their employment is a reference to the employer preventing employees from performing work under their contracts of employment without terminating those contracts.
(5) If the employer locks out employees from their employment in accordance with subsection (3), the employer is entitled to refuse to pay any remuneration to the employees in respect of the period of the lockout.
(6) The employer is not entitled to lock out employees from their employment under subsection (3) unless the continuity of the employees' employment for such purposes as are prescribed by the regulations is not affected by the lock out.
(7) This section has effect subject to the following provisions of this Division."
17 Section 170MT is in the following terms:
"(1) An order made by the Commission under section 127 does not apply to protected action.(2) Subject to subsection (3), no action lies under any law (whether written or unwritten) in force in a State or Territory in respect of any industrial action that is protected action unless the industrial action has involved or is likely to involve:
(a) personal injury; or
(b) wilful or reckless destruction of, or damage to, property; or
(c) the unlawful taking, keeping or use of property.
(3) Subsection (2) does not prevent an action for defamation being brought in respect of anything that occurred in the course of industrial action."
It can be seen that the power of the Commission to order that industrial action stop or not occur, provided for in s 127, does not apply to protected action. It should also be noted that s 166A, which precludes the bringing of an action in tort under State or Territory law against an organisation of employees or an officer, member or employee of such an organisation without a certificate of the Commission, does not refer to protected action.
18 There are also provisions which limit the action which employers may take in responding to protected action by employees. Section 170MU provides:
(1) An employer must not:(a) dismiss an employee, injure an employee in his or her employment or alter the position of an employee to the employee's prejudice; or
(b) threaten to dismiss an employee, injure an employee in his or her employment or alter the position of an employee to the employee's prejudice;
wholly or partly because the employee is proposing to engage, is engaging, or has engaged, in protected action.
(2) Subsection (1) of this section does not apply to any of the following actions taken by the employer:
(a) standing-down the employee;
(b) refusing to pay the employee where, under the common law, the employer is permitted to do so because the employee has not performed work as directed;
(c) action of the employer that is itself protected action.
(3) In proceedings under section 170NF for an alleged contravention of subsection (1) of this section, it is to be presumed, unless the employer proves otherwise, that the alleged conduct of the employer was carried out wholly or partly because the employee was proposing to engage, was engaging, or had engaged, in protected action."
Section 170NC provides:
"(1) A person must not:(a) take or threaten to take any industrial action or other action; or
(b) refrain or threaten to refrain from taking any action;
with intent to coerce another person to agree, or not to agree, to:
(c) making, varying or terminating, or extending the nominal expiry date of, an agreement under Division 2 or 3; or
(d) approving any of the things mentioned in paragraph (c).
(2) Subsection (1) does not apply to action, or industrial action, that is protected action (within the meaning of Division 8).
(3) An employer must not coerce, or attempt to coerce, an employee of the employer:
(a) not to make a request as mentioned in subsection 170LK(4) in relation to an agreement that the employer proposes to make; or
(b) to withdraw such a request."
19 Penalty and enforcement provisions are found in ss 170ND, 170NE, 170NF and 170NG.
20 The protection given by s 170ML only applies during a bargaining period which has been initiated by a notice pursuant to s 170MI. That bargaining period may be suspended or terminated by the Commission in accordance with the provisions found in s 170NW.
21 The legal immunity given to protected action taken under s 170ML only applies if the requirements of s 170MO are satisfied, that is to say a notice is given in the terms required by s 170MO(2) if the action is taken by a union, its members or employees or an employee who is a negotiating party, or a notice is given in the terms required by s 170MO(3) if the action is taken by an employer.
Submissions of the parties
22 The Union submitted that the answer to the question whether conduct pursuant to the notice was "protected action" depended upon an understanding of the parties' contractual rights and obligations in respect of overtime. The Union's argument developed this way - although an employer may require an employee to work reasonable overtime (cl 18(7) of the Award) there is no obligation upon employers to provide employees with any minimum amount of overtime. Accordingly, the working of overtime cannot be required or enforced by employees and is a matter within the discretion, or the gift, of the employer. It followed that the failure of an employer to provide overtime did not expose the employer to action for breach of contract or civil liability. When an employer places a ban on overtime, the employer, in the terms of s 170ML(4), is not "preventing" employees from performing work under their contracts of employment. That is because the employer is not intervening to prevent something which would otherwise occur under the contract of employment; rather, the employer is not offering something which it is otherwise not obliged to offer.
23 The Union submitted that the phrase to "lock out from their employment" in subs (3) of s 170ML was a reference to a total shut down. Substantial emphasis was also placed upon the existence of the term "preventing" in subs (4) as it was submitted that the non-performance of overtime is not something which the employer prevents. It was submitted that the connotation of the term "preventing" was that something is, in the absence of supervening action, going to happen and thus requires stopping.
24 It was submitted that the provisions in Div 8 dealing with protected action are designed to enable employees and employers to engage with immunity in action which might otherwise expose them to civil liability in a civil court. It was said that a mere withholding of, or refusal to offer, overtime would not constitute a breach of contract and thus expose the employer to civil liability so that it would not require protection. The Union relied on the observations of Moore J in Media Entertainment and Arts Alliance v Bundaberg Newspaper Company Pty Ltd (1997) 72 IR 155 at 159-160 in relation to the earlier Div 4 introduced by the Industrial Relations Reform Act 1993 (Cth). Division 4 contained similar provisions to those found in Div 8.
25 The respondents submitted that the conduct set out in the notices was protected action as it fell within the concept of the employers locking out their employees from their employment within s 170ML(3) as that expression was defined in s 170ML(4). The employers submitted that subs (4) of s 170ML was a definitional section and that the reference to "preventing employees from performing work under their contracts of employment" was a reference to the withholding of work opportunities. It was submitted that the evidence disclosed that the employees wished to work during the periods in question and that employers were denying them that opportunity.
26 In contradistinction to the Union, the respondents submitted that a reference to a "lock out" in subss (3) and (4) of s 170ML was not a reference to a total lock out preventing employees from performing all work under their contracts of employment. The respondents submitted that a lock out could be partial and in support of this submission they relied upon the observations of Marshall J in Lennie v Hawks (unreported, 4 October 1996). It was further submitted that subs (4) of s 170ML was not couched in terms of preventing employees from performing work that their contracts of employment obliged them to perform. In essence, the respondents' submission was that the reference in subs (4) of s 170ML to "the employer preventing employees from performing work under their contracts of employment" was a reference to preventing the employees from doing work which, if performed, would be performed under their contracts of employment.
27 The respondents submitted that the Act, and in particular Div 8, focuses on the interruption of industrial relations between the parties and not on their contractual relations. It was said that the expression "preventing" in subs (4) of s 170ML applied to a situation not so much impinging upon legal rights but rather impinging upon the happening of an event, that is to say the performance of work which, if performed by an employee, would be regulated by and would come under the terms of the employee's contract of employment.
28 As I have observed earlier, there was no issue between the Union and the respondents that if overtime was in fact worked by the employees it was work performed under, and governed by, the terms and conditions in their contracts of employment.
Reasoning
29 There is little in the extrinsic material which assists in the interpretation and proper construction of s 170ML. That section was introduced into the Act by the Workplace Relations and Other Legislation Amendment Bill 1996. The Explanatory Memorandum accompanying the Bill observed that the new s 170ML substantially re-enacted the existing section s 170PG. The Explanatory Memorandum does little more than recite the terms of the new section. Section 170PG was introduced into the Act through the Industrial Relations Reform Bill 1993. Again, save for an observation on the right to strike to which I refer later (par 34), the Explanatory Memorandum which accompanied the Bill does little more than recite the terms of s 170PG.
30 I do not accept the Union's submission that in order for a lock out to come within the provisions of subss (3) and (4) of s 170ML it must constitute a total shutdown of an employer's business. Those provisions are not expressed in terms that employees are to be locked out from the whole of their employment in order for the provisions to be satisfied. In particular s 170ML(4) refers to an employer preventing employees "from performing work". It does not say that a lock out is a reference to an employer preventing employees from performing any work under their contracts of employment. This view is consistent with the observations of Marshall J in Lennie v Hawks (supra) at 22:
"Whilst s 170PG(4) of the Act [the predecessor of s 170ML(3)] does not require either the complete cessation of work or the physical exclusion of employees from the workplace, it demands a clear and unambiguous act by reference to which employees can know that they are locked out as a matter of fact."
This approach to the construction of the expression "lock out" in s 170ML(3) and (4) is consistent with the policy which lies behind the concept of "protected action" in s 170ML. The purpose of giving action or conduct the protection of "protected action" is to enable the bargaining party to engage in activities to further their industrial ends. In the case of a union or group of employees they are entitled to undertake any activity which comes within the scope of "industrial action" as defined in the Act which covers a considerable number of actions and activities: see s 4(1) of the Act. An employer has a lesser armoury. It can only deny its employees the opportunity to work. It would be a curious result in an industrial relations context if a union or employees could undertake the range of industrial action in the varying degrees of intensity which the definition of "industrial action" allows, yet the employer had to undertake an all-or-nothing approach - either full-time work or no work at all. There is nothing in the provisions of Div 8 of Pt VIB of the Act which leads to, or requires, the conclusion that the lock out allowed by s 170ML(3) must be total. In the same way as the industrial action available to employees allows employees to place bans or limitations on the performance of particular aspects of their work, the imposition of a lock out allows an employer to limit or restrict the amount of work it will allow its employees to undertake.
31 By virtue of s 170ML(3)(b) a lock out can occur for the purpose of responding to industrial action by employees. Why should it be thought that the only response of an employer to industrial action in the nature of a ban or limitation on the performance of a particular aspect of work must be a response of total shut-down - a response which might be thought in the particular context of limited industrial action to be a gross over reaction?
32 It is for this reason that I consider the reasoning in Kidd v Savage River Mines (1984) 6 FCR 398 and Amalgamated Society of Engineers (Perth Branch) v Millars' Karri and Jarrah Co (1902) Ltd (1907) 9 WAR 207 of limited assistance in the context in which the connotation of "lock out" arises for consideration. The Union submitted that in Kidd v Savage River Mines (supra) Gray J held that a strike required a complete cessation of work and that in Amalgamated Society of Engineers (Perth Branch) v Millars' Karri and Jarrah Co (supra) at 210-211 it was held that a lock out was the converse of a strike. In the abstract, and as a matter of general definition, it may be said that in many situations and contexts a strike is a total withdrawal of labour and that a lock out is a total refusal of an employer to allow its workers to perform work. However that is not always the position.
33 In Kidd v Savage River Mines (supra) Gray J referred to a number of cases, which he explained or distinguished, where industrial action short of a complete cessation of work was characterised as a "strike". His Honour referred to Niceski v Dowell Australia Ltd (1981) 52 FLR 371 in which Smithers J said at 376-377:
"It was made clear in Board of Fire Commissioners of New South Wales v. New South Wales Fire Brigade Employees' Union [[1953] AR (NSW) 622] that a cessation of work by employees acting in combination and a concerted refusal to carry out their well-defined and recognised duties and work is a strike within the ordinary meaning of that work, notwithstanding that they are prepared to, and do, carry out some of their duties: see per Cantor J [[1953] AR (NSW) at p 629]."
In Kidd v Savage River Mines (supra) Gray J observed that in none of the cases to which he had referred had there been a reference to what was said by members of the High Court in McKernan v Fraser [1931] HCA 54; (1931) 46 CLR 343. In that case Dixon J (as he then was), with whom Rich and McTiernan JJ agreed, observed (at 360) that it was noticeable that:
"in most of the attempts to state what amounts to a strike, prominence is given to the cessation or relinquishment of work, or at least the failure to resume work after a nominal interruption or suspension."
However, earlier Dixon J had observed at 360:
"It is not easy to know what is necessary to constitute a `strike'. The word `does not represent any legal definition or description' (per Lord James of Hereford, Denaby and Cadeby Main Collieries Ltd v Yorkshire Miners' Association ([1906] AC 384, at p 405)); and perhaps it has no certain connotation which is settled or accepted."
Further, in Kidd v Savage River Mines (supra) Gray J referred to the judgment of Evatt J in McKernan v Fraser (supra) at 372-378. But at 374 Evatt J said:
"As a consequence of this wide field of jurisdiction, there has been a tendency to regard everything which impedes the smooth carrying on of work in the industry as being, if done by employees, a strike or something in the nature of a strike, if done by employers, a lockout or something in the nature of a lockout. As a matter of course, there has been included in the denotation of a `strike', every stoppage of work."
34 It should not therefore be assumed that in all industrial relations contexts the term "strike" connotes a cessation of all work. Indeed in the Explanatory Memorandum for the Industrial Relations Reform Bill 1993 it was said in relation to s 170PG (the predecessor of s 170ML):
"The action which is protected under section 170PG is defined by reference to industrial action. `Industrial action' is defined in existing section 4 of the Principal Act. It includes bans, limitations and restrictions on the performance of work. The `right to strike' at international law encompasses not only absence from work but also the broader range of industrial action including work-to-rule, go slows, and lock-outs."
35 It is therefore of little assistance in the present context to refer to Kidd v Savage River Mines (supra) or to Amalgamated Society of Engineers (Perth Branch) v Millars' Karri and Jarrah Co (1902) Ltd (supra) at 210-211 where McMillan J (with whom the other members of the Court agreed) referred to an earlier judgment where he had said:
"A strike may be defined as a refusal by the workers to continue to work for their employer unless he will give them more wages or better conditions of labor; a lock-out is the converse of a strike; it is the refusal by an employer to allow his workmen to work unless they will accept his rate of wages or the conditions of labor he imposes."
A lock out may be the converse of a strike in a given case but the context will dictate the nature and extent of the strike and the nature and extent of the lock out. More particularly is this so when one finds, as in this case, a specific definition of lock out in s 170ML(4).
36 The present consideration of the connotation of "lock out" arises in the context to which I have referred - it is the only protected action which an employer may take by way of response to the whole panoply of activity or action available to a Union or employees which falls within the definition of "industrial action" in s 4(1). In that context, the meaning of "lock out" gains colour from the subject-matter which the lock out is intended to support - claims made by the employer in respect of a proposed agreement, and the subject-matter to which the lock out is intended to respond - industrial action by the employees whose employment will be subject to the agreement.
37 The employers also point to the definition of "lock out" in the Oxford English Dictionary (2nd ed) as being:
"An act of `locking out' a body of workers; i.e. a refusal on the part of an employer, or a number of employers acting in concert, to furnish work to their operatives until certain conditions have been assented to by the latter collectively."
Although dictionary definitions provide a background to an understanding of the use of the expression "lock out" in s 170ML, they must be considered with caution because of the specific provisions found in subss (3) and (4) of s 170ML.
38 I do not accept the submission that subs (4) of s 170ML only applies where the employer prevents employees from performing work which they have a right to perform by virtue of the provisions of their contracts of employment. What is contemplated and provided for in subs (4) is a situation where an employer prevents employees from performing work which, if performed, would be performed under and would be governed by the terms of the contracts of employment. It was not in issue that when overtime is worked it is worked on the terms of, and subject to the provisions of, the contracts of employment. When overtime is worked it is not worked under or by reference to any contract other than the contract of employment nor is another contract created by implication.
39 The Union's submissions emphasised the contractual rights which the employees had in relation to their work - they had the right to work a particular number of hours but no right under the Award to work overtime. Overtime was a matter of grace and favour, it was said, for the employers to offer. This emphasis on contractual rights does not pay sufficient regard to what it is that the employees are being denied - not so much the work provided in their contracts of employment but rather any work, which if undertaken, is regulated and governed by their contracts of employment. It is significant that what s 170ML(4) contemplates is not the employer "preventing employees from performing their contracts of employment" but rather the employer "preventing employees from performing work under their contracts of employment".
40 Section 170ML(3)(b) makes it clear that to the extent that a lock out is reactive it has to be a response to industrial action by employees whose "employment will be subject to the agreement". It is that employment from which the employees are to be excluded; that is to say, any work which will be subject to their contracts of employment which includes any overtime which the employees are asked to work. Section 170ML(4) is not a limitation or restriction on this concept. It is exegetical of it. The reference in subs (4) to "performing work under their contracts of employment" is still a reference to work which, if carried out, is governed by those contracts. Insofar as subs (4) adds a gloss to subs (3) it is a gloss that any lock out, to come within the concept of "protected action", must not cause or result in a termination of the employees' contracts of employment.
41 I do not accept the submission of the Union that when s 170ML(4) refers to an employer "preventing" employees from performing work under their contracts of employment, the word "preventing" is being used in the sense of stopping or inhibiting something which, in the absence of intervention by the act of preventing, is going to happen. The Oxford English Dictionary (2nd ed) contains a number of definitions of "prevent", the most relevant, for present purposes, being:
To provide beforehand against the occurrence of (something); to render (an act or event) impracticable or impossible by anticipatory action; to preclude, stop, hinder. (A chief current sense)."
Another definition is:
"To stop, keep, or hinder (a person or other agent) from doing something."
The expression "preventing" in the context of s 170ML(4) involves the doing of an act which has the consequence that employees cannot perform work which, if performed, would be work performed under their contracts of employment. The concept of "preventing" in the context of s 170ML(4) is not limited to a situation of putting up a barrier or bar to something which is going to happen in the absence of some supervening event stopping it; it also covers a situation where something is stopped in circumstances where if it was allowed or granted it would occur in a particular way. I therefore reject the Union's submission that because overtime does not require any intervention from an employer to prevent it happening but rather requires the employer to require it be worked, there is no "preventing" within subs (4) of s 170ML when overtime is banned.
42 It may be accepted that the purpose of Div 8 in relation to protected action is to enable bargaining parties to engage in action which might otherwise expose them to actionable civil liability: Media Entertainment and Arts Alliance v Bundaberg Newspaper Company Pty Ltd (supra) at 159. But it does not follow that only actions or conduct which would otherwise be actionable at law are actions or conduct which are contemplated by the scope of the industrial action allowed to employees and their organisations under s 170ML(2) and the scope of lock outs allowed to employers under s 170ML(3). Section 170ML certainly "identifies certain action" in respect of which immunity from legal action is to be granted but it does not follow that action has to be otherwise actionable at law for it to fall within the scope of action which may be taken by employees and their organisations and employers under s 170ML.
43 I have therefore concluded that the subject-matter of the notices and any conduct of the employers pursuant to or in accordance with those notices falls within the scope of the action and conduct which the employers are entitled to take under s 170ML(3) of the Act. As that action and conduct constitutes:
"a ban, limitation or restriction on the performance of work, or on acceptance of or offering for work, that is adopted in connection with an industrial dispute'
within sub-par (c) of the definition of "industrial action" in s 4(1) the action and conduct is "protected action" under s 170MT of the Act.
44 I have therefore concluded that the question asked:
"Whether the Respondents' conduct pursuant to the notices comprising exhibit TCB6 to the affidavit of Toby Carl Borgeest affirmed on 16 February 2000 is protected action under s 170MT of the Workplace Relations Act 1996 (Cth)"
should be answered:
"Yes"
45 I will hear the parties as to whether any other orders or directions should be made or given.
I certify that the preceding forty-five (45) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Goldberg. |
Associate:
Dated: 17 March 2000
Counsel for the Applicant: |
Mr H Borenstein |
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Solicitor for the Applicant: |
Slater and Gordon |
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Counsel for the First, Second and Third Respondents: |
Mr J E Middleton QC and Mr C O'Grady |
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Solicitor for the First, Second and Third Respondents: |
Freehill Hollingdale & Page |
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Counsel for the Fourth, Fifth, Sixth, Seventh, Eighth and Ninth Respondents: |
Mr S Wood |
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Solicitor for the Fourth, Fifth, Sixth, Seventh, Eighth and Ninth Respondents: |
Deacon Graham and James |
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Date of Hearing: |
23 February 2000 |
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Date of Judgment: |
17 March 2000 |
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URL: http://www.austlii.edu.au/au/cases/cth/FCA/2000/169.html