Emwest Products Pty Ltd v Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union [2002] FCA 61 (6 February 2002)

Last Updated: 7 February 2002

FEDERAL COURT OF AUSTRALIA

Emwest Products Pty Ltd v Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union [2002] FCA 61

INDUSTRIAL LAW - application for injunction to restrain industrial action - whether a union can "engage in" industrial action for the purposes of s 170MN of the Workplace Relations Act 1996 (Cth) - existence of a certified agreement, the nominal expiry date of which has not passed - scope of s 170MN prohibition - whether prohibition against industrial action for the purpose of advancing claims in respect of matters not agreed in the certified agreement

WORDS & PHRASES - "engage in" - "in respect of the employment of employees whose employment is subject to the agreement"

Workplace Relations Act 1996 (Cth), ss 3, 4(8), 170L, 170MN

Acts Interpretation Act 1901 (Cth), s 15AA

Davids Distribution Pty Ltd v National Union of Workers [1999] FCA 1108; (1999) 91 FCR 463 considered

Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Laing (1998) 89 FCR 17 referred

Australian Paper Limited v Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (1998) 81 IR 15 cited

Skilled Engineering Limited v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (2001) 108 IR 116 referred

Kilpatrick Green Pty Ltd v The Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia [1998] FCA 559 followed

Canberra Hospital v Australian Nursing Federation [2001] FCA 1473 cited

Keppel Prince Engineering Pty Ltd v AFMEPKIU [2001] FCA 1637 cited

The Original Juice Co Pty Limited v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [2001] FCA 675 referred

Hayman Reese a Division of Trimas Corporation Pty Ltd v AFMEPKIU [2001] FCA 1279 cited

Hayman Reese a Division of Trimas Corporation Pty Ltd v AFMEPKIU (No 2) [2001] FCA 1328 cited

BHP Steel (AIS) Pty Ltd v Construction, Forestry, Mining and Energy Union (2000) 102 IR 275 cited

Email Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [2000] FCA 1932 referred

Pioneer Concrete Services Ltd v Galli [1985] VR 675 referred

Ashbury v Reid [1961] WAR 49 considered

Australian Securities and Investments Commission v Doyle (2001) 38 ACSR 606 referred

R v Lam (1990) 46 A Crim R 402 referred

R v Tannous (1987) 10 NSWLR 303 referred

R v Buckett (1985) 132 ALR 669 referred

Yorke v Lucas (1983) 49 ALR 672 cited

Theiss Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union [1999] FCA 407, (1999) 92 IR 221 referred

Belan v National Union of Workers [2001] FCA 724 cited

Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation [1981] HCA 26; (1981) 147 CLR 297 applied

Miller v University of New South Wales [2000] FCA 1563 referred

Amcor Packaging (Australia) Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [1999] VSC 434 cited

ACI Operations Pty Ltd v Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union (2000) 96 IR 228 cited

Greg McCarry "Industrial Action under the Workplace Relations Act 1996 (Cth)" (1997) 10 Australian Journal of Labour Law 133

EMWEST PRODUCTS PTY LTD T/AS EMAIL METERING (ABN 78 002 894 224) v AUTOMOTIVE, FOOD, METALS, ENGINEERING, PRINTING & KINDRED INDUSTRIES UNION

V 985 of 2001

KENNY J

6 FEBRUARY 2002

MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V 985 OF 2001

BETWEEN:	EMWEST PRODUCTS PTY LIMITED T/AS EMAIL METERING (ABN 78 002 894 224) Applicant
AND:	AUTOMOTIVE FOOD METALS ENGINEERING PRINTING & KINDRED INDUSTRIES UNION Respondent
JUDGE:	KENNY J
DATE OF ORDER:	6 FEBRUARY 2002
WHERE MADE:	MELBOURNE

THE COURT ORDERS THAT:

The application be dismissed.

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	V 985 OF 2001

BETWEEN:	EMWEST PRODUCTS PTY LIMITED T/AS EMAIL METERING (ABN 78 002 894 224) Applicant
AND:	AUTOMOTIVE, FOOD, METALS, ENGINEERING, PRINTING & KINDRED INDUSTRIES UNION Respondent

JUDGE:	KENNY J
DATE:	6 FEBRUARY 2002
PLACE:	MELBOURNE

REASONS FOR JUDGMENT

1 At the trial of this matter on 29 October 2001, Emwest Products Pty Limited ("Emwest") sought declaratory and injunctive relief against the Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union ("the union") upon the ground of an alleged contravention, or threatened contravention, of s 170MN of the Workplace Relations Act 1996 (Cth) ("the Act"). Emwest did not pursue its original application for a penalty. Upon certain undertakings, including the usual undertaking as to damages, the Court had earlier granted Emwest interlocutory relief.

2 Emwest markets and services a range of gas and electricity meters, gas regulators and associated measurement and control equipment for the commercial and industrial sector of the energy distribution market. The union has members who are employed by Emwest, relevantly at Emwest's Newport site in Victoria.

3 Section 170MN, which falls within Div 8 of Pt VIB of the Act, complements other provisions in the division concerning the taking of industrial action. During a bargaining period for a proposed agreement under Div 2 or 3 of Part VIB of the Act ("a certified agreement"), which is initiated by a notice under s 170MI, a union or other relevant party is entitled to organise or engage in industrial action against an employer for the purpose of supporting or advancing claims in respect of the proposed certified agreement. Assuming all procedural requirements have been met, industrial action during a bargaining period will be protected action, with the benefit of the immunity conferred by s 170MT(2) of the Act. Once a certified agreement is made, however, s 170MN(1) of the Act prohibits a union or an employee bound by or subject to the agreement from engaging in industrial action for the purpose of supporting or advancing claims against the employer in respect of the employee's employment from the time when the agreement comes into operation until its nominal expiry date. Action in contravention of s 170MN(1) is not protected action: see s 170MN(3). Section 170MN(1) is what the Act terms a "penalty provision" (s 170ND(b)) in respect of which the Court may not only impose a penalty (s 170NF) but may also grant an injunction (s 170NG).

background facts

Certified Agreements

4 Emwest employs about 71 employees at Newport who are bound by the Metal, Engineering and Associated Industries Award 1988 ("1988 Award") Parts I and V. Over recent years, there have been four other agreements purporting to relate, wholly or in part, to these employees. Each of the agreements was certified by the Australian Industrial Relations Commission ("the Commission"). They were:

(1) Emwest Products Pty Limited Emailgas Division Certified Agreement 1997 Code EO539 ("1997 agreement");

(2) Emailgas Redundancy Agreement 1998 Code EO823 ("1998 redundancy agreement");

(3) Email Victorian Manufacturing Agreement 1999 Code EO948 ("1999 agreement"); and

(4) Email Metering Newport Operations Enterprise Agreement 2000 Code PR903599 ("2000 agreement").

5 The 1997 agreement was certified on 22 September 1997 and had a nominal expiry date of 30 June 1999. It applied to Emwest's employees at Newport who were engaged under the Metal Industry Award 1984 ("1984 Award") Parts I, II and V. The 1997 agreement made provision for the terms and conditions of employment of these employees, and the continued operation of other awards and certified agreements. It did not contain any provision concerning redundancy.

6 The 1998 redundancy agreement was certified on 14 December 1998 and had a nominal expiry date of 30 September 2000. In addition to the union and Emwest, the Transport Workers' Union was also a party. The agreement applied not only to Emwest's employees at Newport but also its employees at another site in Victoria. The 1998 redundancy agreement provided for redundancy only, including the process for redundancy and severance pay. The 1998 agreement made provision for three weeks' pay per year of service, capped at 52 weeks. It also made provision for the payment out on redundancy of up to twelve weeks' accrued sick leave.

7 The 1999 agreement was certified on 13 October 1999 and had a nominal expiry date of 30 June 2000. The agreement, which applied to a number of Emwest sites across Victoria and bound various unions, provided for different commencement dates at the various sites. Clause 5 of the 1999 agreement relevantly provided that:

The application of the terms of this agreement at each site specified in Schedule `A' will be from the day after the expiry date specified in Schedule `A'.

In relation to the Newport site, Schedule A specified the agreement duration as "01/07/97 to 30/09/99" and the EBA Code as "EO823". EO823 was the code of the 1998 redundancy agreement, although neither the 1997 agreement nor the 1998 agreement had a nominal expiry date of 30 September 1999.

8 The 1999 agreement dealt with a range of terms and conditions of employment including redundancy. Clause 16 provided for 3.25 weeks' pay per year of service capped at 70 weeks. There was no provision for payment out on redundancy of accrued sick leave. Clause 16.2 of the 1999 agreement stipulated that:

Where existing site redundancy arrangements provide payments and conditions in excess of these minimum standards, those existing redundancy arrangements continue to apply.

9 The relationship between the 1999 agreement and other awards and agreements was addressed in clauses 6 and 14 of the 1999 agreement. Clause 6.3 stated:

Existing award and over award payments and conditions of employment shall continue to apply as if they were a term of this Agreement except where the expressly stipulated terms of this Agreement provide otherwise.

Clause 14 relevantly stated:

Except where specified the previous enterprise agreements and local site agreements shall continue to apply as if they were a part of this Agreement, but to the extent of any inconsistency this Agreement is to prevail.

10 The 2000 agreement was certified on 30 April 2001 and had a nominal expiry date of 30 June 2003. Emwest and the union were parties to the 2000 agreement, which applied to all employees at the Newport site engaged in any of the occupations, industries or callings specified in the 1998 Award Parts I and V. All production employees of Emwest at the Newport site were covered by the 2000 agreement.

11 The 2000 agreement covered a broad range of employment conditions, and it required observance of the 1998 Award. The 2000 agreement did not contain any provisions dealing directly with redundancy. Clause 5 provided, however, that:

This Agreement supersedes all other pre-existing Agreements whether registered or not to the extent of any [in]consistency. Where no inconsistency exists, the provisions of previous agreements will apply.

12 The 2000 agreement also set out a procedure for the avoidance of disputes: cl 18. Its no extra claims provision, in cl 17, provided as follows:

It is a term of this Agreement that all employees bound by this Agreement will not pursue any extra wage claims, award or overaward, or any other changes to conditions of employment for the life of this Agreement, notwithstanding the application of higher duties allowance as well as the regrading of a position, or classification advancement based on the acquisition of acquired skills or promotion.

Negotiations over Redundancy Entitlements

13 The union initiated a bargaining period for what was to become the 2000 agreement by a s 170MI notice dated 22 June 2000 under cover of a letter from the State Secretary Elect of the Victorian Branch of the union. The bargaining notice stated that the matters to be dealt with by the proposed agreement should include:

(1) Subject to the following clauses the incorporation into the agreement of all existing wages and conditions, whether specified in the Award or not.

...

(4) Agreement to require the employer to provide reasonable notification to employees and their union(s) and provide consultation about, changes in the workplace that impact on employees in any way, including any impact on job security. This includes the regulation and limitation of the use of contractors, and sub-contractors, and anything else that may impact on job security.

...

(19) The employer shall provide an additional portable severance payment of $80 per week to be paid into the agreed industry trust fund and to be accessible upon resignation, redundancy or retirement from any job. The existing accrued entitlements will be paid into the industry trust fund.

...

(24) No involuntary redundancies during the life of the agreement.

In August 2000, the parties agreed to drop redundancy from the negotiations for the 2000 agreement and to consider the topic in the following year.

14 At the end of a meeting in early July 2000, a union representative told Emwest's manufacturing manager that the union wished to commence negotiations for a new redundancy agreement. Representatives of the union and Emwest discussed a proposed new redundancy agreement to cover Emwest's employees at Newport at meetings on 20 July 2001 in the course of which Mr Bruce Jackson, who was Emwest's General Manager, Human Resources, stated that the business of Emwest at Newport was going to be sold and that the business would be transmitted to a new owner.

15 At subsequent meetings on 9 August 2001, Mr Jackson stated that it would be difficult to alter the fundamental terms and conditions of employment of Emwest employees as these terms and conditions had been disclosed to prospective buyers. Later that day, a union organiser, Mr Leigh Deihm, informed Mr Jackson that the employees at Newport had voted to take protest action by leaving work, and that they were not returning until 13 August 2001.

16 On 13 August 2001, Emwest applied to the Commission under s 127(2) of the Act for an order preventing industrial action in relation to the re-negotiation of redundancy entitlements. The union served a s 170MI bargaining notice on Emwest on 15 August 2001, and subsequently gave an undertaking that any future industrial action would be taken in accordance with the Act.

17 The Commission dismissed Emwest's s 127(2) application on 29 August 2001. In his reasons for decision, Commissioner Hingley stated that the jurisdictional prerequisites for a s 127 order were not present and that, in any event, in his discretion he would not make such an order. The Commissioner further stated:

I am satisfied the Act accepts in its terms the possibility of co-existing enterprise agreements and their provisions being unrelated and separate with different nominal expiry dates. It is competent for the union to initiate a bargaining period in respect of the Redundancy Agreement during the term of the general agreement and as a consequence be eligible to take protected action in pursuit of renegotiating the Redundancy Agreement, subject of course to otherwise complying with s 170MO.

18 On 3 September 2001, the union served on Emwest a notice, pursuant to s 170MO of the Act, stating that the employees at Newport intended to take industrial action from 4.00pm on Friday 7 September 2001, comprising a total ban on overtime, and a stop work two hours before the end of each shift every day. The proposed action was to continue for a period of three months, or until agreement was reached, whichever was the sooner. The union also gave notice pursuant to s 170MR of the Act. Emwest sought interlocutory relief in this Court on 6 September 2001. A subsequent hearing of Emwest's interlocutory application was adjourned, upon various undertakings, to facilitate a meeting between the parties on 13 September 2001, to attempt to resolve the dispute.

19 The parties were unable to reach agreement on 13 September 2001 with respect to terms for redundancy. Mr Deihm deposed:

At this meeting, Jackson said that ... due to the sale process they would not be moving in relation to the cap and substantive issues like that. The company was only willing to offer 3.25 weeks pay per year of service.

The union continued to seek 3.75 weeks per year of service. The union was unable to agree to what the company wanted in relation to quantum and outplacement services. The members had clearly indicated to me that these issues are of central importance to them - especially in circumstances where a sale of the business is on the horizon.

20 Later the same day, the union served a further notice of intended industrial action pursuant to s 170MO of the Act. The notice indicated that the employees intended to take industrial action from 7.00am on Wednesday 19 September 2001. The industrial action was to be a total ban on overtime, and rolling stoppages across Emwest's entire operation. The action was to continue for a period of three months, or until agreement was reached, whichever was the sooner. The union also gave notice under s 170MR of the Act. I granted Emwest interlocutory relief on 18 September 2001: see Emwest Products Pty Ltd v Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union [2001] FCA 1334.

the parties' submissions

21 The dispute between Emwest and the union is limited to the terms and conditions of redundancy of Emwest's employees at Newport. The s 170MO notices served by the union on Emwest indicated that these employees intended to take industrial action during the periods nominated in the notices. Emwest contends that in taking steps to organise industrial action, by serving s 170MO (and s 170MR) notices, the union has engaged in industrial action, alternatively threatened to engage in industrial action, contrary to s 170MN(1) of the Act. Emwest submits that, in the circumstances of the case, s 170MN(1) prohibits the union in engaging in any industrial action in support of the employees' redundancy claims because their employment remains subject to the 2000 agreement, the nominal expiry date of which has not yet passed.

22 Against this, the union contends that s 170MN does not operate in this way. First, the union submits that the prohibition in s 170MN(1) is only against "engaging" in industrial action, and not against organising industrial action. Secondly, the union submits that s 170MN(1) does not prohibit the union from engaging in industrial action in this case because the subject matter in dispute (redundancy) is not dealt with in the 2000 agreement. Thirdly, the union submits that if Emwest's interpretation of s 170MN is accepted, nonetheless no injunctive relief should be granted.

23 In response to the union, Emwest contends that it does not matter whether the prohibition in s 170MN(1) extends to industrial action in connection with a matter that is not dealt with in a relevant certified agreement because the 2000 agreement in fact provided for redundancy by incorporating either the 1999 agreement or the 1998 redundancy agreement.

24 I deal in turn below with each of these submissions.

HAS THE UNION ENGAGED IN INDUSTRIAL ACTION WITHIN THE MEANING OF S 170MN(1)?

25 "Industrial action" is defined in s 4(1) of the Act, in essence to mean:

* the performance of work in a manner different from that in which it is customarily performed;

* a ban, limitation or restriction on the performance of work;

* a failure or refusal to attend for work.

26 The term was considered in Davids Distribution Pty Ltd v National Union of Workers [1999] FCA 1108; (1999) 91 FCR 463 ("Davids Distribution") where the Full Court said, at 491, that "picketing which does not involve obstruction and besetting does not fall within the definition of `industrial action'; it does not relate to the performance of work in the circumstances specified in ... the definition": cf Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Laing (1998) 89 FCR 17 per French J. In the course of joint judgment, Wilcox and Cooper JJ said at [52]:

[I]f the picket takes the form of preventing or hindering people from performing, accepting or offering for work, its effect is to limit or restrict the performance of work, or the acceptance of, or offering for, work. Such conduct may be regarded as falling literally within par (c) of the definition of `industrial action'. However, consistently with the tentative view of the Full Court in CFMEU [(1998) 89 FCR 200], we think the paragraph ought to be read as applying only to limitations on the work of those imposing the ban. The history of the legislation and policy considerations persuade us it is likely Parliament intended to confine the paragraph in this way.

27 Counsel for the union relied on this passage in this case in support of her submission that only employees, and not unions, can "engage in" industrial action. They did so, she said, when they withdrew their labour and performed their work otherwise than in the usual manner, in support of demands or claims on their employer. Having regard to the definition of "industrial action" in s 4(1) of the Act and the comments of Wilcox and Cooper JJ in Davids Distribution, this submission would have some force but for the operation of s 4(8) and s 170MN(2) of the Act. These provisions are discussed below.

28 In support of its submission that it could not relevantly "engage in" industrial action, the union noted that other provisions in Div 8 (e.g., s 170ML(2) and s 170MM(1) and (2)) distinguish between "organising" and "engaging in" industrial action. It submitted that the legislature had deliberately omitted the word "organise" from s 170MN(1) because it intended to attach liability only to employees whose employment was covered by the non-expired certified agreement. There is some support for this in the legislative history of s 170MN(1): the Senate deleted the words "organise or" from the expression "organise or engage" appearing in the Bill presented to it. I have not, however, found any explanation for the Senate amendment.

29 In Australian Paper Limited v Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (1998) 81 IR 15 ("Australian Paper") at 21-22, North J also referred to the distinction in other provisions in the Act between "organising" and "engaging" in industrial action, in accepting the view of s 170MN(1) for which the union contends. Australian Paper has not, however, been followed: cf Skilled Engineering Limited v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (2001) 108 IR 116 ("Skilled Engineering") at [10] per Finkelstein J.

30 In Kilpatrick Green Pty Ltd v The Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia [1998] FCA 559 ("Kilpatrick Green") at p 14, Ryan J, who took a different view of s 170MN from North J, observed:

It is true that s 170ML(2) appears to speak disjunctively of an entitlement to `organise or engage in industrial action directly against the employer'. However, the entitlement is not conferred distributively on the organisation of employees and its officers on the one hand and the members employed by the employer and employees who are negotiating parties on the other. In other words, the concluding part of s 170ML(2) contemplates that an organisation of employees may `engage in' as well as `organise' industrial action and a member of the organisation employed by the relevant employer may similarly `organise' industrial action against the employer as well as engage in it himself or herself. Sub-ss 170MN(1) and (2) preserve the same dichotomy between engaging in and organising industrial action but not in a mutually exclusive way that confines the former activity to employees of the relevant employer and the latter to the registered organisation and its officers.

31 Kilpatrick Green has been followed on a number of occasions in this Court, although generally in connection with interlocutory applications: see Skilled Engineering at [10]; Canberra Hospital v Australian Nursing Federation [2001] FCA 1473 at [7]; Keppel Prince Engineering Pty Ltd v AFMEPKIU [2001] FCA 1637 at [27]; The Original Juice Co Pty Limited v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [2001] FCA 675 ("Original Juice"); Hayman Reese a Division of Trimas Corporation Pty Ltd v AFMEPKIU [2001] FCA 1279 at [19]- [23]; Hayman Reese a Division of Trimas Corporation Pty Ltd v AFMEPKIU (No 2) [2001] FCA 1328 at [15]; BHP Steel (AIS) Pty Ltd v Construction, Forestry, Mining and Energy Union (2000) 102 IR 275 at 290; and Email Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [2000] FCA 1932 ("Email")at [12].

32 Section 170MN(2) makes it clear that the prohibition in s 170MN(1) is applicable to "an organisation of employees" that is bound by the certified agreement, and an officer or employee of such an organisation, as well as an employee whose employment is subject to the certified agreement. As Ryan J said in Kilpatrick Green, s 170MN(2) must contemplate that an organisation of employees can "engage in" industrial action in the sense in which that expression is used in s 170MN(1).

33 Further, s 4(8) of the Act provides as follows:

In this Act, a reference to engaging in conduct includes a reference to being, whether directly or indirectly, a party to or concerned in the conduct.

The effect of s 4(8) is that the union engages in conduct, relevantly industrial action, if the union is "directly or indirectly, a party to or concerned in" the conduct. The union will be directly or indirectly concerned in the industrial action if it procures Emwest's employees to impose bans, limitations or restrictions on their work, or to stop work, as the union has indicated it intends to do by notices delivered under s 170MO. In referring to a "party to or concerned in" conduct, s 4(8) may on occasion expand the application of the Act. In the case of s 170MN(1), if it does, it does not affect the underlining meaning of the expression "industrial action". Contrast Pioneer Concrete Services Ltd v Galli [1985] VR 675 at 707.

34 The expression "concerned in" is of general import, and it can cover a wide range of activities depending on the context in which it is used and the facts of the relevant case. In Ashbury v Reid [1961] WAR 49 at 51, the Full Court of the Western Australian Supreme Court held that a defendant to a charge under s 54(1) of the State Forestry Act 1918-1954 would be "directly or indirectly concerned in" the commission of the offence if "on the facts it can reasonably be said that the act or omission shown to have been done or neglected to be done by the defendant does in truth implicate or involve him in the offence, whether it does show a practical connexion between him and the offence". Other courts have attributed much the same meaning or operation to the expression "concerned in": see Australian Securities and Investments Commission v Doyle (2001) 38 ACSR 606 at [215]; Kilpatrick Green at 15; Lam v R (1990) 46 A Crim R 402 at 405; R v Tannous (1987) 10 NSWLR 303 at 307-8; and R v Buckett (1985) 132 ALR 669 at 674. In Yorke v Lucas (1983) 49 ALR 672 at 682, the Full Court of this Court held that the words "a party to" a contravention in s 75B(c) of the Trade Practices Act 1974 (Cth) referred to a person who is aware of the elements of the contravention, and who participates in, or assents to the contravention. If s 170MN(2) left any room for doubt about the potential application of s 170MN(1) to a union, this doubt is removed by s 4(8) of the Act.

35 For these reasons, it seems to me that the decision of Ryan J in Kilpatrick Green is correct on this point and a union may "engage in" industrial action for the purpose of s 170MN(1) of the Act.

INDUSTRIAL ACTION FOR THE PURPOSE OF ADVANCING CLAIMS IN RESPECT OF EMPLOYEES' EMPLOYMENT

36 The action that was notified and authorised by the union in its ss 170MO and 170MR notices was industrial action. The action notified by the s 170MO notice dated 13 September 2001 did not take place because the Court granted Emwest interlocutory injunctive relief on 18 September 2001. Neither Emwest nor the union contended that the relevant purpose was not to advance claims against Emwest in respect of the employment of its employees. The union does not dispute that the purpose of the proposed industrial action was to support and advance a claim for improved redundancy benefits for Emwest's employees at Newport. Indeed, in written submissions, counsel for the union stated:

The dominant (indeed the only) purpose here relates to negotiations for a new Redundancy Agreement ... .

(In this connection, I note that by a letter of open offer dated 26 October 2001, the union proposed that, during the due diligence process that attended the sale of Emwest's business, the parties agree to a redundancy rate of 3.25 weeks per year of service and incorporate cl 16 of the 1999 agreement in the 2000 agreement. The union further proposed that the parties agree to negotiate an escalation of the quantum of the redundancy upon the expiration of the due diligence process.) There is no need to consider this aspect of the case further. The issue raised by Cooper J in Theiss Contractors Pty Ltd v Construction, Forestry, Mining and Energy Union [1999] FCA 407 at [14]- [19] can be put to one side: see, on appeal, (1999) 92 IR 221 ("Theiss Contractors") and, for further discussion, Original Juice at [34]-[38] per Goldberg J. I am satisfied that there has at the least been a threatened breach by the union of s 170MN(1) unless the subsection is to be read down in the manner discussed hereafter: see also Belan v National Union of Workers [2001] FCA 724 at [73]- [75].

does the 2000 agreement incoroporate previous provisions for redundancy?

37 As already noted, in response to the union's submission that s 170MN(1) has no application in this case because redundancy is not dealt with in the 2000 agreement, Emwest contends that the 2000 agreement provided for redundancy by incorporating either the 1998 redundancy agreement or the 1999 agreement.

38 Under the Act, a certified agreement comes into operation when it is certified and, subject to s 170LX, remains in operation at all times afterwards: see s 170LX(1). Section 170LX provides, in subs (2), that the agreement ceases to be in operation if:

(a) its nominal expiry date has passed; and

(b) it is replaced by another certified agreement.

Where there are two certified agreements in operation, to the extent of any inconsistency, the second in time does not prevail over the first until its nominal expiry date has passed: see s 170LY(1)(b).

39 Clause 5 of the 2000 agreement operates within this statutory context. The second sentence in cl 5 operates within the context of s 170LY(2) of the Act. That is, given a previous certified agreement will continue in operation if not replaced by another certified agreement, notwithstanding its nominal expiry date has passed, there is scope for inconsistency between a previous agreement and the 2000 agreement. Clause 5 assists in resolving any such inconsistency by providing a rule for interpretation. Neither expressly nor by necessary implication does cl 5 incorporate the terms of the previous agreement into the 2000 agreement. It follows, therefore, that if s 170MN(1) is to be read down in the manner for which the union contends, then Emwest's application must fail.

40 I note, before passing to this latter matter, that an issue arose between the parties in the course of the hearing as to whether Emwest's employees at Newport currently enjoy redundancy benefits pursuant to the 1998 redundancy agreement, as the union contends, or pursuant to the 1999 agreement, as Emwest contends. It is unnecessary, as both parties ultimately conceded, to determine this issue, and I do not do so. It is sufficient that Emwest's employees at Newport have no certified agreement that deals with redundancy that has not passed its nominal expiry date.

THE SCOPE OF THE PROHIBITION IN S 170MN(1)

41 The issue is one of the proper construction of s 170MN. Section 170MN was introduced by the Workplace Relations and Other Legislation Amendment Act 1996 (Cth). That Act, it may be recalled, amended the statutory regime introduced by the Industrial Relations Reform Act 1993 (Cth) ("the Reform Act"). The Reform Act introduced the notion of certified agreements and enterprise flexibility agreements.

42 The effect of s 170MN is straightforward enough. Where there is on foot a certified agreement, the nominal expiry date of which has not yet passed, s 170MN(1) prohibits industrial action by an employee whose employment is subject to the agreement, or by a union bound by the agreement or officer of such a union, "for the purpose of supporting or advancing claims against the employer in respect of the employment of employees whose employment is subject to the agreement". The prohibition in s 170MN(1) against industrial action is, on any view, a limited one. The prohibition does not extend to industrial action taken for a non-prescribed purpose, even where there is a relevant certified agreement: cf Email at [12] per Madgwick J. This aspect of the provision's operation reflects the statutory assumption that when parties make an agreement with respect to employment, they do so on the basis that they will not resort to industrial action during the currency of the agreement in respect of the matters upon which they have reached agreement.

43 The issue in this case arises out of the ambiguity created by the use of the expression "in respect of the employment of employees whose employment is subject to the agreement". The reference to "the agreement" is a reference to the certified agreement, the nominal expiry date of which has not yet passed. The whole expression is, however, capable of having more than one meaning. The expression may be read as referring to "the employment of employees [where this] employment is [specifically] subject to the agreement". That is, the expression may refer to only the matters actually agreed upon by the parties in the agreement. If so, the prohibition would relevantly extend only to industrial action taken for the purpose of advancing claims in respect of such agreed matters. The union contends that this is the correct construction of s 170MN(1).

44 Indeed, this construction is supported by Ryan J's decision in Kilpatrick Green. In Kilpatrick Green, the relevant certified agreement provided that where the employer undertook a project with a total value in excess of $56.2 million, the parties could negotiate a "specific site agreement" which would take precedence over the certified agreement. The employer was awarded a contract for a project valued at $360 million. The union imposed bans on the performance of work on the project until the site agreement was resolved. Ryan J held that the union had not contravened s 170MN. His Honour held that the employment of the employees at the site was not subject to the certified agreement because the agreement itself excepted the relevant area of work from its operation, and left open the possibility that a new certified agreement would be concluded with respect to this work (pp 8-9).

45 Emwest's submissions support an alternative construction. The expression may refer to "the employment of employees [where this] employment is [in some way or other] subject to the agreement". If so, the prohibition would extend to industrial action taken for the purpose of advancing any claim pertaining to the employment of an employee to whom (or to whose work) the relevant certified agreement applied.

46 If the expression is, as I think, open to more than one meaning, it is to be construed in the way that would best promote the relevant statutory object: Acts Interpretation Act 1901 (Cth), s 15AA. The principal objects of the Act are set out in s 3 and include the following:

(c) enabling employers and employees to choose the most appropriate form of agreement for their particular circumstances, whether or not that form is provided for by this Act; and

...

(e) providing a framework of rights and responsibilities for employers and employees, and their organisations, which supports fair and effective agreement-making and ensures that they abide by awards and agreements applying to them.

The object of Pt VIB, in which s 170MN is located, is "to facilitate the making, and certifying by the Commission, of certain agreements, particularly at the level of a single business or part of a single business": s 170L of the Act.

47 Further, as Mason and Wilson JJ observed in Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation [1981] HCA 26; (1981) 147 CLR 297 at 320:

The fundamental object of statutory construction in every case is to ascertain the legislative intention by reference to the language of the instrument viewed as a whole. But in performing that task the courts look to the operation of the statute according to its terms and to legitimate aids to construction.

See also Miller v University of New South Wales [2000] FCA 1563 where Branson J held that the expression "an employee whose employment is subject to the agreement" in s 178(5A)(b) and s 413A of the Act was also ambiguous: see [19]-[27]. (I have not been assisted in resolving this issue of construction by either the Minister's Second Reading Speech for what was to become the Amendment Act or the explanatory memoranda accompanying the Bill. Further, so far as I am aware, the issue has not previously arisen: cf, e.g., Theiss Contractors; Original Juice; Hayman Reese v AFMEPKIU [2001] FCA 1279 at [19]- [23]; Hayman Reese v AFMEPKIU (No 2) [2001] FCA 1328 at [15]; and Amcor Packaging (Australia) Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [1999] VSC 434 (29 October 1999) per Beach J at [53].)

48 The question of the proper construction of the expression "in respect of the employment of employees whose employment is subject to the agreement" is not free from doubt. Although the construction that Emwest favours is perhaps the most obvious, and results in a relatively straightforward application of the provision, for the reasons set out below, I am not persuaded that it is to be accepted as the preferable construction.

49 Part VIB permits a certified agreement to cover a single business, or part of a single business such as a geographically distinct part of an employer's business or a distinct operational or organisational unit: see ss 170L and 170LB. Part VIB also contemplates that employees may be subject to more than one certified agreement (the nominal expiry date of which has not passed) at any one time: see s 170LY(1)(b) of the Act. This latter matter is, as appears below, significant in resolving the issue with which I am presently concerned.

50 Division 8 of Pt VIB, which includes s 170MN, provides a statutory regime for negotiating a certified agreement. As already noted, under the Act, a union and its officers, and employees may engage in industrial action, which is protected action, within a bargaining period. A bargaining period for a certified agreement may be initiated by union, an employer, or an employee acting on his or her own behalf and on behalf of other employees, who wants to negotiate a certified agreement "in relation to employees who are employed in a single business or a part of a single business": s 170MI(1). A notice under s 170MI(2) must state that the "initiating party" (see s 170MI(1)) "intends to try (a) to make an agreement with the other negotiating parties under Division 2 or 3; and (b) to have any agreement so made certified under Division 4".

51 The particulars which must accompany the s 170MI notice include "the matters that the initiating party proposes should be dealt with by the agreement": s 170MJ(c). Once a bargaining period begins (see s 170MK), then a union, a union member employed by the employer, a union officer, or an employee who is a negotiating party is entitled to organise or engage in industrial action against the employer for the purpose of supporting or advancing claims made in respect of the proposed agreement, or of responding to a lockout: s 170ML(2). Subject to certain procedural requirements (s 170MO and s 170MR), action taken in these circumstances is protected action and subject to the immunity conferred by s 170MT of the Act. The Act also provides that action is not protected action unless there has been a genuine attempt to reach agreement previously: see s 170MP. The bargaining period ends if a certified agreement is made; the initiating party tells the other negotiating parties that it no longer wants to reach a certified agreement; or the Commission terminates the period: s 170MV of the Act.

52 Save for the ambiguity attaching to the expression "in respect of the employment of employees whose employment is subject to the agreement" in s 170MN(1), there is nothing in the above-mentioned provisions that would support the proposition that the bargaining regime for a certified agreement is not available in respect of the bona fide negotiation of any certified agreement that may be negotiated and made under the Act, subject to the statutory safeguards: see, e.g., s 170MW. On the contrary, save possibly for s 170MN, the statutory assumption is not only that more than one certified agreement, the nominal expiry date of which is not yet passed, may apply at a work site but that the remainder of Div 8 would apply in relation to the negotiation of a certified agreement under the Act.

53 Bearing in mind s 15AA of the Acts Interpretation Act 1901 (Cth) and ss 3 and 170L of the Act, it is legitimate to have regard to the consequences of the competing constructions of s 170MN. It is difficult to see how the making of certified agreements would be facilitated in accordance with s 170L if, as the union put it:

[E]mployees subject to two certified agreements dealing with different topics and expiring on different days would be `hamstrung' by the differing expiry dates and prevented from taking protected action in relation to one agreement merely because another agreement dealing with other topics had not yet expired.

As the union submitted:

The absurdity of this result is even clearer if one considers what would occur if the position [in this case] were reversed, and the 1998 Redundancy Agreement had been expressed to expire after the 2000 General Agreement. In such a circumstance, the employees would not be able to negotiate an improvement in their terms and conditions of employment, including wage rates, for close to three years.

54 Emwest submitted that, if the construction favoured by Emwest were accepted, nonetheless the union and its members would not be precluded from seeking to negotiate improved redundancy benefits. This, however, does not meet the point the union makes. One author has stated:

The facilitation of bargaining necessarily requires the recognition of a right by the bargaining parties to take lawful industrial action. Under a bargaining regime, `[u]nless labour and management do have recourse to the work stoppage it is unlikely that bargaining would be fruitful, for there would be no reason for a party, believing it would be disadvantaged by making a particular concession, to do so. In fact, in the absence of this coercive power, it is unlikely that bargaining would even commence. [Footnote omitted.]

See Greg McCarry "Industrial Action under the Workplace Relations Act 1996 (Cth)" (1997) 10 Australian Journal of Labour Law 133 at 133-134.

See also ACI Operations Pty Ltd v Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union (2000) 96 IR 228 at 233 per Merkel J, citing Australian Paper at 18 per North J.

55 Emwest also submitted that the construction of s 170MN(1) for which the union contends "would severely limit the scope of s 170MN, as unions and employees would be able to take industrial action in relation to claims about matters arguably not in the certified agreement" and "would undermine the purpose and effect of parties reaching agreements and having them certified". Assuming the policy behind s 170MN is to encourage parties to adhere to the bargain they have struck, then the policy would not, in my view, be defeated by permitting the parties to negotiate effectively in respect of matters that were not the subject of a relevant certified agreement. The policy is sufficiently protected if s 170MN(1) is construed as prohibiting parties to a certified agreement from resorting to industrial action to undo the matters they have agreed upon in the certified agreement, if its nominal expiry date has not passed. If the parties so desired, they could agree that a certified agreement made by them was intended to cover the whole field of relevant employment, thereby excluding the possibility of industrial action during the currency of the agreement.

56 From time to time, issues about the purpose of industrial action will arise, on whatever view one takes of s 170MN. If the construction for which the union contends is accepted, issues may well arise as to whether a matter was dealt with in a relevant agreement. The courts, the Commission and others experienced in the field of industrial relations are familiar with issues of this kind. This consideration does not persuade me that the union's approach does not best meet the statutory objects to which I have referred. In this case, there is, as we have seen, no dispute about the purpose of the industrial action in question.

no extra claims clause

57 I note, lest it be thought the matter had been overlooked, that the 2000 agreement contained a no extra claims clause. The clause is set out earlier in these reasons.

58 As already noted, although the bargaining notice for what was to become the 2000 agreement included reference to redundancy issues, Emwest and the union subsequently agreed to drop redundancy issues from the negotiations for the 2000 agreement and to consider the topic in the following year. The no extra claims clause was, presumably, negotiated with this agreement in mind. In any event, Emwest and the union entered into negotiations regarding redundancy in July 2001 in keeping with their earlier understanding. No attempt was made by Emwest at that time or at the hearing to rely on the no extra claims clause to preclude the union from advancing the redundancy claims. In the circumstances, no issue arises concerning the clause.

relief

59 For the reasons given, s 170MN(1) does not prohibit industrial action for the purpose of advancing the redundancy claims of Emwest's employees at Newport, notwithstanding the 2000 agreement. At the final hearing, Emwest has not made out its case for declaratory or injunctive relief, and its application should be dismissed.

I certify that the preceding fifty-nine (59) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Kenny.

Associate: Dated: 6 February 2002

Counsel for the Applicant:	Mr F Parry
Solicitor for the Applicant:	Cutler Hughes & Harris
Counsel for the Respondent:	Ms R Doyle
Solicitor for the Respondent:	Maurice Blackburn Cashman
Date of Hearing:	29 October 2001
Date of Judgment:	6 February 2002