BARGAINING AGENCY FEE TO UNION NOT OBJECTIONABLE

Cases

BARGAINING AGENCY FEE TO UNION NOT OBJECTIONABLE

A clause in 236 certified agreements that required new employees to pay a service fee was held not to be an objectionable provision requiring or permitting conduct in contravention of the Freedom of Association provisions of the Workplace Relations Act 1996.

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A clause in 236 certified agreements that required new employees to pay a service fee was held not to be an objectionable provision requiring or permitting conduct in contravention of the Freedom of Association provisions of the Workplace Relations Act 1996. The decision in Section 298Zapplication by the Employment Advocate, PR900919, (9 February 2001), highlights the fact that conduct under s298K(1) is in breach of the legislation only if it is undertaken for a prohibited reason.

Background

A 'Bargaining Agents Fee' clause in 236 certified agreements required that the various parties to the agreements were to advise all new employees that a bargaining agents fee of 1 per cent of the employees gross annual income, or $500 per annum, which ever was the greater, was payable to the union. The agreements were in the manufacturing sector and were negotiated by the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (the union).

The Employment Advocate sought to vary all 236 agreements through an application under s298Zof the Workplace Relations Act 1996. Section 298Zprovides that the Employment Advocate may apply to the federal Commission for the removal of objectionable provisions from a certified agreement. An objectionable provisions is defined as a provision that requires or permits, or purports to require or permit any conduct that would contravene the freedom of association provisions of the Act.

The principal freedom of association provisions are s298Kand s298L.Generally, these sections combine to provide that employers cannot, for a prohibited reason, do or threaten to:

  • dismiss an employee;
  • injure an employee's employment;
  • alter the position of an employee;
  • refuse to employ another person; or
  • discriminate against employees in the terms or conditions on which an employer offers to employ another person.

The range of prohibited reasons, in this regard, include membership of an industrial association or alternatively an employee's refusal to become a member of an industrial association.

Submissions

It was the contention of the Employment Advocate that the bargaining agents fee clause was objectionable in that it required or permitted conduct by an employer to do one or more of the things specified in s298K(1) for the prohibited reason that that the employee was or did not propose to become a member of the union.

The Employment Advocate submitted that the clause effectively authorised the employer to compel the employee to pay the fee as a condition of employment. To this end the compulsory payment of a fee to the union at the direction of the employer, was according to the Advocate, conduct within the scope of s298K(1)(b), (c) and (e), in that it was conduct that could injure an employee, alter the position of an employee and discriminate against employees. The union on the other hand submitted that the Bargaining Agency Fee clause did not require or permit the employer to do anything other than advise new employees of the fee.

Conclusion

The Vice-President was of the view that the Bargaining Agency Fee clause was designed to persuade new employees to join the union. This view was premised upon the fact that the union would waive the fee in respect of union members and the fact that the $500 fee was substantially more than the union membership fee.

However, the task before McIntyre VP was to consider whether the clause in question was an objectionable provision as defined by s298Z(5). The Commission commenced by considering whether the clause required or permitted conduct by the employer of the types described in s298K(1). In this regard McIntyre VP examined cl 1.3 of the agreements. Clause 1.3 of the agreements provided that the terms and conditions of the agreements were a condition of employment. The operation of cl 1.3 led the Vice-President to formulate the view that if an employee failed to pay the bargaining agency fee then he or she may potentially be in breach of their agreement, and accordingly the employer would be entitled to take disciplinary action against the employee. As such the Bargaining Agency Fee clause required or permitted employers to take action against employees who failed to pay the fee. Such an action, would be conduct of the type described in s298K(1).

The Commission then considered whether the conduct was carried out for a prohibited reason—namely that the employees were not and did not purport to become union members. It is important to remember that conduct under s298K(1) is in breach of the legislation only if it is undertaken for a prohibited reason.

McIntyre VP concurred with the union in finding that the Employment Advocate had failed to establish the existence of a prohibited reason. Disciplinary action taken by an employer against an employee for breaching the Bargaining Agency Fee clause would not be for failing to become a union member, rather it would be because the employee breached the obligations of the agreement. To fulfil the onus of establishing the existence of a prohibited reason, the Commission required the Employment Advocate to address issues of motive and intent.

Therefore, while the Commission was of the view that the Bargaining Agency Fee clause required or permitted conduct within s298K(1), the Vice-President was of the view that the conduct was not carried out for the prohibited reason because the employees were not members of the union. As such the Bargaining Agency Fee clause was held not to be an objectionable provision and the applications were accordingly dismissed

 
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