Automotive Food Metals Engineering Printing and Kindred Industries Union v The Age Company Limited [2004] FCA 299 (23 March 2004)

Last Updated: 23 March 2004

FEDERAL COURT OF AUSTRALIA

Automotive Food Metals Engineering Printing and Kindred Industries Union v The Age Company Limited [2004] FCA 299

INDUSTRIAL LAW – termination of employment – application for interlocutory relief pending determination of substantive proceeding – that the claims raise serious issues to be tried not in contention - whether the balance of convenience favours the grant of the interlocutory relief sought

Federal Court of Australia Act 1976 (Cth) s23
Trade Practices Act 1974 (Cth) ss52,87
Workplace Relations Act 1996 (Cth) s178

Bullock v Federated Furnishing Trades Society of Australia (1985) 5 FCR 464, referred to
Turner v Australasian Coal and Shale Employees’ Federation and Elcom Collieries Pty Ltd (1984) 6 FCR 177, referred to





AUTOMOTIVE FOOD METALS ENGINEERING PRINTING AND KINDRED INDUSTRIES UNION; COMMUNICATIONS, ELECTRICAL, ELECTRONIC, ENERGY, INFORMATION, POSTAL, PLUMBING AND ALLIED SERVICES UNION OF AUSTRALIA AND IAN KERRY v THE AGE COMPANY LIMITED AND JOHN FAIRFAX HOLDINGS LIMITED

V284 OF 2004






MARSHALL J
23 MARCH 2004
MELBOURNE

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	V284 OF 2004

BETWEEN:	AUTOMOTIVE FOOD METALS ENGINEERING PRINTING AND KINDRED INDUSTRIES UNION FIRST APPLICANT COMMUNICATIONS, ELECTRICAL, ELECTRONIC, ENERGY, INFORMATION, POSTAL, PLUMBING AND ALLIED SERVICES UNION OF AUSTRALIA SECOND APPLICANT IAN KERRY THIRD APPLICANT
AND:	THE AGE COMPANY LIMITED (ACN 004 262 702) FIRST RESPONDENT JOHN FAIRFAX HOLDINGS LIMITED (ACN 008 663 161) SECOND RESPONDENT
JUDGE:	MARSHALL J
DATE OF ORDER:	23 MARCH 2004
WHERE MADE:	MELBOURNE

THE COURT ORDERS THAT:

Upon the Court accepting the first respondent’s undertaking which is annexed to this order and marked "A":

1. The orders made on 11 March 2004 be set aside, save for the reservation concerning liberty to apply.
2. The trial be set down for 10.15 am on Tuesday 4 May 2004 with the ensuing 8 days also being set aside, i.e. 5, 6, 7, 10, 11, 12, 13, 14 May 2004.

3.	The trial be by way of affidavit.
4.	The respondents file and serve a defence on or before 29 March 2004.
5.	The applicants file and serve any further affidavits on which they intend to rely at the trial on or before 2 April 2004.

6. The respondents file and serve any further affidavits on which they intend to rely at the trial on or before 16 April 2004.
7. On or before 27 April 2004 the docket judge’s associate must be notified in writing by or on behalf of the applicants whether the trial will proceed.
8. The applicants, in consultation with the respondents, compile an indexed and paginated court book containing current pleadings and particulars, affidavits and a copy of any document that any party will seek to tender at the trial. Three copies of the book are to be filed no later than 27 April 2004.
9. Any objection to any part of any affidavit be filed and served not later than 20 April 2004.
10. Any answers to any such objections be filed and served no later than 27 April 2004.
11. The parties file and exchange lists of authorities and chronologies no later than 27 April 2004.
12. The directions hearing for 31 March 2004 be vacated.
13. The proceeding be referred to the Victorian District Registrar for the conduct of a mediation as soon as is practicable with a report back to the docket judge of the result of the mediation as soon as possible.

A
First Respondent’s Undertaking

1. The first respondent undertakes that for a period of nine months or until the hearing and determination of this proceeding, whichever first occurring, the first respondent will pay to the persons listed in Schedule A hereto an amount of money equivalent to the difference between:

a) the gross wages:

i.	the person would have received had the person continued in employment with the first respondent for a period of nine months following 12 March 2004; or
ii.	for the period between 12 March 2004 and the date of the hearing and determination of this proceeding whichever first occurring; and

b) the gross payment made to the person represented by the redundancy payment set out in clause 4.4.4 of the Spencer Street Print Facility Agreement 2002.

2. The first respondent further undertakes that it will not seek to recover any payment made under paragraph 1 from any person listed in Schedule A hereto.

3. Payments to any person under paragraph 1 will commence only after redundancy payments made to that person have been exhausted and any such payment will be made in equal fortnightly instalments.

SCHEDULE A

1. Shane Buncle
2. Peter Kyriakopoulos
3. Alan Phillip O’Keefe
4. Sherralyn Osborne
5. Rory Vella
6. Chris Mark
7. Aaron Marsh
8. Stuart Castree
9. Gary Ian Anderson
10. Michael Barker
11. Phillip Nielsen
12. John Vianney Templin
13. Bruno Leepin
14. Mustafa Yuksel

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	V284 OF 2004

BETWEEN:	AUTOMOTIVE FOOD METALS ENGINEERING PRINTING AND KINDRED INDUSTRIES UNION FIRST APPLICANT COMMUNICATIONS, ELECTRICAL, ELECTRONIC, ENERGY, INFORMATION, POSTAL, PLUMBING AND ALLIED SERVICES UNION OF AUSTRALIA SECOND APPLICANT IAN KERRY THIRD APPLICANT
AND:	THE AGE COMPANY LIMITED (ACN 004 262 702) FIRST RESPONDENT JOHN FAIRFAX HOLDINGS LIMITED (ACN 008 663 161) SECOND RESPONDENT

JUDGE:	MARSHALL J
DATE:	23 MARCH 2004
PLACE:	MELBOURNE

REASONS FOR JUDGMENT

Introduction

1 On 5 March 2004 the applicants filed an application claiming relief against the respondents, including:

• penalties under s178(1) of the Workplace Relations Act 1996 (Cth) ("the WR Act") for the first respondent’s alleged breaches of the Spencer Street Print Facility Agreement 2002 ("the Agreement");
• a declaration under s87 of the Trade Practices Act 1974 (Cth) ("the TP Act") in respect of conduct of the first respondent, allegedly in breach of s52 of the TP Act;
• damages for breaches of contracts of the third applicant and other persons who he represents in the proceeding as a representative party pursuant to Part IVA of the Federal Court of Australia Act 1976 ("the FCA Act");
• an order under s23 of the FCA Act restraining the first respondent from breaching its contract with the third applicant and those he represents ("the employees");
• damages for breach of the TP Act by the first respondent;

2 The applicants also sought relief against the second respondent, but that relief is not relevant to what is currently before the Court, that is, the question whether the first respondent should be subject to an interlocutory injunction pending trial or further order.

3 On the filing of the application and the accompanying statement of claim the Court allocated a directions hearing date of 10 March 2004. On 9 March 2004, the Court, by consent, adjourned that directions hearing to 31 March 2004.

4 On 11 March 2004 the applicants filed a notice of motion seeking interlocutory relief on an urgent basis. The motion sought (amongst other things) orders that the first respondent withdraw, or give no effect to, notices of termination given to the employees on 4 February 2004. The notices of termination otherwise effected the relevant terminations as at 4 pm on 12 March 2004. The hearing of that motion came on urgently before the Court on the afternoon of 11 March 2004. The Court heard submissions on whether it should grant interim injunctive relief to the applicants to preserve the subject matter of the litigation until the parties were in a proper position to make submissions and present evidence for and against the grant of interlocutory relief, that is, the extension of any interim orders which may be granted.

5 At approximately 8.45 pm on 11 March 2004 the Court ordered that:

"Upon the First and Second Applicants giving the usual undertaking as to damages:

1.	Until 5.00 pm on 16 March 2004, or until further order, the notice of termination given to each of the employees named in the schedule attached will not take effect (the schedule included the names of most of those persons represented by the third applicant, as well as the third applicant, the list was later extended by consent).
2.	The directions hearing and the application for interlocutory relief be adjourned to not before 11.30 am on Tuesday 16 March 2004.
3.	Liberty to apply is reserved to each other party, on short and reasonable notice in the circumstances."

6 The Court heard the application for the extension of the interim relief on an interlocutory basis (effectively the application for interlocutory relief) on 16 and 17 March 2004.

7 It was not contested by counsel for the respondents that the claims made by the applicants under the TP Act raised serious issues to be tried. Counsel for the applicants submitted that the claims made under the TP Act were very strong such that a marked balance of convenience in favour of the respondents would be required for the Court to refuse to grant interlocutory relief: see Bullock v Federated Furnishing Trades Society of Australia (1985) 5 FCR 464 at 472, per Woodward J (with whom Smithers and Sweeney JJ agreed).

8 Counsel, on each side of the record, effectively acknowledged that a central question in the determination of the motion is to discern where the balance of convenience lies.

Background – in summary

9 As the docket judge in the proceeding it is inappropriate that I make firm findings of fact at this stage of the matter. It is sufficient to record that:

• the first and second applicants ("the unions") are organisations of employees who are registered pursuant to the WR Act;
• the employees are employed by the first respondent;
• the first respondent and the unions are parties to and bound by the Agreement;
• it is a term of the Agreement that there would be no forced or involuntary redundancies until March 2005;
• the first respondent has given notice of termination to the employees;
• the employees do not accept the termination and are ready, willing and available to work pursuant to their contracts of employment;
• the first respondent has no work for the employees to perform but continues to pay the employees pursuant to an undertaking given to the Australian Industrial Relations Commission until the determination of an appeal before the Commission ("the Commission undertaking");
• the contracts of employment remain on foot pursuant to the Court’s interim order of 11 March 2004;
• the employees are entitled to redundancy pay on termination. Most employees have substantial entitlements to redundancy pay. The first respondent has offered an undertaking to the Court to the effect that it will pay fourteen employees, identified by the first respondent as being those having the least service with it, for a period of 9 months or until the hearing and determination of the proceeding, a sum of money which would ensure that those employees are financially no worse off for not having their contracts of employment extended by way of interlocutory relief.

Balance of convenience

10 I accept the submissions of counsel that there are serious issues to be tried in the proceeding. I have some doubts about accepting the submissions of counsel for the applicants to the effect that the claim under s52 of the TP Act is a very strong one. In the end it is not necessary to determine that point because the balance of convenience is overwhelmingly in favour of the first respondent.

11 If the interim order is discharged, but the employees succeed at trial, they will be entitled to approximately 12 months pay each. Apart from about 14 of their number, each other employee will receive an amount of redundancy pay at least equivalent to the sum each such employee would have received had he or she continued to work with the first respondent until March 2005. The relevant 14 employees, as a result of an undertaking offered by the first respondent, will have their position protected for a period up to 12 December 2004. To ensure that the proceeding is concluded prior to that date, the Court will set the matter down for trial at an early date. The Court also encourages the parties to engage in early mediation to attempt to resolve the matter.

12 The undertaking offered by the first respondent, which the Court accepts, means that no financial disadvantage should accrue to any of the employees as a result of the discharge of the interim order. An early trial will also ameliorate any concerns of the applicants. In this regard, it should be noted that this docket judge is prepared to allocate time to this matter to that end, which time would ordinarily have been spent in judgment writing in other matters and preparation for Full Court hearings in May 2004.

13 The Court has given serious consideration to the submission of counsel for the applicants that the case is not just about money but about a right to retain employment for another year. However the stark reality is that the first respondent has no work for the employees to perform and the Court cannot compel it to provide that work. The fact is that if the interim relief is extended, the employees will be paid not to come to work and if they succeed at trial, they will get their redundancy pay after March next year. If the interim order is discharged the employees will get their redundancy pay now and if they succeed at trial they will get their entitlement to extra wages then.

14 Another factor to be weighed in the balance and which favours the discharge of the interim relief is the fact that the first respondent, pursuant to the terms of the Commission undertaking, will continue to pay the employees’ wages until the determination of an appeal before the Commission. Acceptance of the Commission undertaking by the President of the Commission led to the grant of an order staying an earlier order of Commissioner Whelan which had the same practical effect as the interim relief in this matter, that is, it kept the contracts of employment of the employees on foot.

15 In these circumstances I cannot foresee any employee being worse off as a result of the discharge of the interim relief. If I am in error in that view and it subsequently is shown that any individual is not in receipt of income to sustain him or her pending the finalisation of this litigation, I will call on the matter for the specific purpose of considering whether the first respondent can remedy such a situation, if necessary by Court order. By "sustained", the Court has in mind that the employees be no worse off for having their contracts of employment lapse pending the hearing and determination of the matter, than they would be if they were successful at trial.

16 The Court is alive to the concerns of the unions that they stand to lose the right to represent the employees if the interim relief is not extended. That consideration, however, must be viewed realistically in that there would be little they could do to assist members who are paid to stay at home. It does not necessarily follow that the employees will cease to be members of the union. They may recognise and appreciate the efforts of the unions in bringing this litigation and stay loyal to them. The registered rules of the unions are not in evidence. However, it is well established that a person does not automatically cease to become a member of an organisation as a result of ceasing to work in an industry covered by the organisation’s rules, unless something in the rules compels that result. See, for example, Turner v Australasian Coal and Shale Employees’ Federation and Elcom Collieries Pty Ltd (1984) 6 FCR 177 at 194.

17 As referred to at [12] above, any concerns of the employees and the unions on their behalf, can be assuaged by an early trial that the Court will take extraordinary steps to facilitate.

18 Nothing in these reasons for interlocutory judgment should be seen as overriding in any way the Commission undertaking. In other words any liability for payment of redundancy pay does not relieve the first respondent from current additional payments due pursuant to the Commission undertaking.

19 The Court considers that having regard to the foregoing, the orders it will make will ensure the fairest interim arrangements in the circumstances pending the determination of the proceeding.

20 The Court will order as follows:

Upon the Court accepting the first respondent’s undertaking which is annexed to this order and marked "A":

1. The orders made on 11 March 2004 be set aside, save for the reservation concerning liberty to apply.
2. The trial be set down for 10.15 am on Tuesday 4 May 2004 with the ensuing 8 days also being set aside, i.e. 5, 6, 7, 10, 11, 12, 13, 14 May 2004.

3.	The trial be by way of affidavit.
4.	The respondents file and serve a defence on or before 29 March 2004.
5.	The applicants file and serve any further affidavits on which they intend to rely at the trial on or before 2 April 2004.

6. The respondents file and serve any further affidavits on which they intend to rely at the trial on or before 16 April 2004.
7. On or before 27 April 2004 the docket judge’s associate must be notified in writing by or on behalf of the applicants whether the trial will proceed.
8. The applicants, in consultation with the respondents, compile an indexed and paginated court book containing current pleadings and particulars, affidavits and a copy of any document that any party will seek to tender at the trial Three copies of the book are to be filed no later than 27 April 2004.
9. Any objection to any part of any affidavit be filed and served not later than 20 April 2004.
10. Any answers to any such objections be filed and served no later than 27 April 2004.
11. The parties file and exchange lists of authorities and chronologies no later than 27 April 2004.
12. The directions hearing or 31 March 2004 be vacated.
13. The proceeding be referred to the Victorian District Registrar for the conduct of a mediation as soon as is practicable with a report back to the docket judge of the result of the mediation as soon as possible.

I certify that the preceding twenty (20) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Marshall.

Associate:


Dated: 23 March 2004

Counsel for the Applicant:	Dr K Hanscombe SC with Mr L Armstrong
Solicitor for the Applicant:	Maurice Blackburn Cashman
Counsel for the Respondent:	Mr J Middleton QC with M McDonald and C O’Grady
Solicitor for the Respondent:	Corrs Chambers Westgarth
Date of Hearing:	16 and 17 March 2004
Date of Judgment:	23 March 2004