FWA rules two labour flexibility clauses in, one out

Cases

FWA rules two labour flexibility clauses in, one out

FWA has granted unions secret ballots in two cases where collective bargaining agreement clauses related to restrictions on the use of contract labour, but has refused a ballot in a third case.

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FWA has granted unions secret ballots in two cases where collective bargaining agreement clauses related to restrictions on the use of contract labour, but has refused a ballot in a third case.
 
The relevant clauses are noted below.
 
Consult before hiring contractors
 
In a case involving the AMWU and Bitzer Australia (trading as Buffalo Trident) the union wanted the following clause to be in the agreement:
‘16.Contractors
 
16.1Consultation:
 
16.1.1 Before the employer engages contractors or labour hire companies to do work covered by this Agreement the employer must consult with the Union. For the purpose of the consultation the employer must inform the Union of:
  • the name of the proposed contractor(s) or labour hire company or companies;
  • the type of work proposed to be given to the contractor(s) or labour hire company or companies;
  • the number of persons and qualifications of the persons the proposed contractor(s) or labour hire company or companies may engage;
  • and the likely duration.
16.1.2 The employer must consult with the Union over issues such as:
  • safety;
  • criteria for the selection of particular contractors or labour hire companies;
  • whether having the work done in-house will enhance or diminish job security for employees engaged under the Agreement;
  • alterations in the working conditions for employees covered by this Agreement caused by the proposed use of contractors or labour hire companies; and
  • inductions and facilities for contractor and labour hire employees.’
 
‘Not permitted content’ — argument rejected
 
The company objected to this clause, saying it was not permitted content; and, therefore, the union was not genuinely trying to reach an agreement.
 
However, Senior Deputy President Jennifer Acton ruled the union was pursuing the clause as part of the proposed agreement in circumstances where:
  • permitted matters for an enterprise agreement include matters pertaining to the employment relationship as well as matters pertaining to the relationship between an employer and an employee organisation
  • an enterprise agreement must include a consultation term requiring an employer to consult its employees about major workplace changes likely to significantly affect them and allowing those employees to be represented for that consultation
  • a claim requiring an employer to fully consult with a union about all aspects of proposed changes which will affect the performance or organisation of work has been held by a Full Bench of the Australian Conciliation and Arbitration Commission to be a claim which seeks to regulate the relations of employers and unions
  • award provisions for an employer, pre-decision, to consult with and provide information to a union and/or employees about workplace change which might have a material effect on its employees, including on their employment, job and promotional opportunities, skills usage, hours, work or work location, have been recognised by the High Court as matters pertaining to the employment relationship
  • it can be accepted workplace change involving the engagement of contractors or labour hire companies by an employer to do work covered by an enterprise agreement may affect the employment, job and promotional opportunities, skills usage, hours, work or work location of the employees covered by the agreement
  • a clause in a workplace agreement requiring a company to consult with shop stewards as to the reasons additional labour hire agency employees are required has been held by a Full Bench of the Australian Industrial Relations Commission to be a matter pertaining to the employment relationship
  • clause 16.1 only requires the employer to consult with the AMWU about contractors and labour hire companies and provide information for the purposes of that consultation before the employer engages the contractors or labour hire companies.
 
‘In these circumstances, I considered the AMWU’s clause 16.1 for the proposed enterprise agreement was a permitted matter for an enterprise agreement under the FW Act,’ SDP Acton said.
 
 
 
Discuss and consult
 
In a case involving the LHMU and Coca Cola Amatil (CCA), the company asserted that the clause dealing with the use of labour-hire employees in the LHMU draft agreement did not constitute a permitted matter such that, on the approach recently adopted by a Full Bench of FWA in Australian Postal Corporation v CEPU, the LHMU was not genuinely trying to reach an agreement.
 
The clause the union wanted in the agreement said:
‘29.2.1 The Company retains the right to use third party contract labour to cover unplanned absences where it is unable to fill that position with a CCA casual employee. Where the absences are unplanned, there is no requirement for consultation.
 
29.2.2 Except as provided in clause 29.3.3, where there is a planned requirement for third party contract labour employees, the Company will refer this matter to the Job Delegate(s). For the purposes of discussion, the Company will provide relevant information.
 
29.2.3 If, after consultation, the Employer engages contractor(s), those contractors must be afforded the same terms and conditions of employment as they would receive if they were engaged as employees performing the same work.’
Substantial claim
 
Senior Deputy President Mathew O’Callaghan ruled that the proposed obligation that CCA discuss and consult with job delegates before engaging third-party labour-hire contractors is a substantial claim.
 
‘I do not consider that the claim restricts CCA’s capacity to engage third-party labour hire contractors,’ he said.
 
‘I agree with the LHMU position that an alleged breach of the consultative requirements gives rise to a potential claim for breach of the agreement or a dispute notification, but does not impede CCA from implementing the contracting arrangement.’
 
‘Had the proposed consultation provisions been more onerous, had they explicitly established a capacity to restrict the contracting process or had there been provision for Fair Work Australia to determine if and when a contracting initiative might occur, I may have arrived at a different conclusion.’
 
 
 
Restriction on use of contractors
 
However, the union was not so successful in the third case where the MUA was seeking an agreement with the Fremantle Port Authority (FPA).
 
Again the employer claimed that clauses relating to labour flexibility were not a permitted matter.
 
In response, the MUA denied the claim was not a permitted matter. The union wanted a clause similar to one in the 2004 agreement which said:
‘Tier 1 identified staff will generally be engaged in the first instance for casual engagements. Within operational constraints including the skills, qualifications and capability of individuals, the offering of casual engagements shall be generally done on an equitable basis.
 
Tier 2 casual staff will be brought in on an ad hoc basis as operationally required, generally through labour hire companies where Tier 1 staff are not available.’
Not seeking non-permitted matter
 
In support of its case, the MUA argued it was not seeking a labour flexibility provision that would be a non-permitted matter.
 
‘I observe however that the MUA did not point to any documentation that sets out the details of their labour flexibility claim that would support the tribunal in concluding that their claim does not overreach into being a non-permitted matter,’ said Commissioner Bruce Williams.
 
He said the union’s evidence was ‘tailored to avoid a finding that the MUA in pursuing its claim for labour flexibility is seeking anything that may not be a permitted matter’.
 
Restrict right to use contractors
 
Cmr Williams did not accept that evidence.
 
‘My finding is that the MUA has been and is seeking a labour flexibility claim that would restrict or qualify the right of the FPA to use contractors as they choose,’ he said.
 
He denied the application for a secret ballot.
 
 
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