Union coverage in bargaining disputes

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14 November 2011

A Fair Work Australia Full Bench has recently reinforced the limitations around individuals seeking to act as bargaining representatives when they are also officials of unions not entitled to represent the industrial interests of employees involved in enterprise bargaining, and clarified when a union official will be regarded as acting in a private capacity or representing a union.

In Technip Oceania Pty Ltd v Tracey [2011] FWAFB 6551, a Full Bench of Fair Work Australia held that Will Tracey, Assistant Branch Secretary for the Maritime Union of Australia (MUA), was acting in his capacity as a union officer and not as a private individual when representing employees in enterprise bargaining.  Given the MUA was not entitled to represent the employees who were intended to be covered by the enterprise agreement, the employer was not required to recognise Mr Tracey as a bargaining representative.

Background

Technip employ a number of people as casual employees to operate Remotely Operated Vehicles (ROV’s) in offshore oil and gas fields. They are employed under the ROV Casual Employee Collective Agreement 2009 (Agreement), which had a nominal expiry date of 27 July 2011. Will Tracey was appointed by the employees covered by the Agreement to bargain for the proposed replacement agreement. At the time, Mr Tracey was the Assistant Branch Secretary for the Maritime Union of Australia (MUA).

Technip refused to recognise Mr Tracey as the appointed bargaining representative, arguing that he was doing so in his capacity an MUA official, and it was the Australian Maritime Officer’s Union (AMOU) that covers ROV operators. Technip argued that section 176(3) of the Fair Work Act 2009 (Cth) (Act) prevented him from acting in the negotiations. Section 176(3) of the Act provides that a union cannot act as a bargaining representative unless the organisation is entitled to represent the industrial interests of the employee in relation to work that will be performed under the agreement.  Here, the MUA was not entitled to represent the industrial interests of the ROV operators but the AMOU was.

Mr Tracey then made an application to Fair Work Australia (FWA) for bargaining orders under section 229 of the Act, seeking orders that Technip:

  • recognise him as the employees' appointed bargaining representative; and
  • hold no further negotiation with the employees regarding the replacement Agreement.

Decision at first instance

Commissioner Cloghan outlined the lack of limitations as to what class of “persons” could be bargaining representatives under section 176 of the Act, and said that considering employees are at the centre of the negotiation of an enterprise agreement, they should be able to determine who their bargaining representative is. Further, neither the required consultation clause in the Agreement, nor the model consultation term found in the Fair Work Regulations 2009 (Cth) provided for a particular type of representative.

Accordingly, the Commissioner said that there were only two limitations upon the appointment of a representative:

  • the person must be independent from the employer; and
  • the appointment must not breach section 176(3) of the Act.

Mr Tracey was clearly independent, and the Commissioner was also satisfied that Mr Tracey was acting in his personal capacity, rather than in the capacity as an official of the MUA.  Therefore, there was nothing to prevent him acting as the appointed bargaining representative.  

Technip appealed, arguing the application under section 229 for bargaining orders was not made in Mr Tracey’s personal capacity but rather in his role as an MUA official.

appeal Decision

The majority (consisting of His Honour Justice Giudice and Commissioner Blair) of the Full Bench of FWA found that the application that was made under section 229 of the Act was invalid because, at the time, Mr Tracey was acting in his capacity as a MUA official and not in a personal capacity.  The majority considered relevant factors to include:

  • in correspondence exchanged between Technip and Mr Tracey, the MUA’s signature block was used;
  • the log of claims submitted by Mr Tracey contained “unmistakeable indications that Mr Tracey’s advocacy for ROV operators was inextricably linked to the MUA”;
  • it could be inferred that Mr Tracey was operating from the MUA’s premises and using MUA resources; and
  • even the application for bargaining orders made under section 229, while using Mr Tracey’s name, contained the address and contact details of the MUA.

Senior Deputy President Drake dissented and considered that Mr Tracey was acting in a personal capacity. Her Honour considered that the majority's conclusion did not take into account what Mr Tracey was doing in his individual capacity as a bargaining representative, including in all his communications confirming his status as an individual acting as a bargaining representative.

As a result of this decision, permission to appeal was granted and the decision to make bargaining orders was quashed.

Implications for employers

  • The Full Bench majority’s decision makes it clear that it will depend upon the facts of each individual case whether a union official is acting in their personal capacity as a bargaining representative, or representing a union. This decision confirms, however, that you look at all of the bargaining representative’s actions in determining in which capacity they are acting, rather than simply the assertions of the purported bargaining representative that they are acting in an individual capacity.
  • Employers should be alive to which unions have industrial coverage to represent their employees, and critically consider any claims by union officers who are purporting to represent members in an individual capacity, particularly when that union does not have industrial coverage for those employees.
  • We may see an increasing use by unions of devices (such as separate contact details or non-union entities) through which they seek to conduct activities as a bargaining representative, to strengthen any argument they are acting in an individual capacity rather than in their capacity as a union official.

Contacts

John Tuck

Partner. Melbourne
+61 3 9672 3257

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Jack de Flamingh

Partner. Sydney
+61 2 9210 6192

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Nicholas Ellery

Partner. Perth
+61 8 9460 1615

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