[2013] FWCFB 2022

Fair Work Act 2009

s.604 - Appeal of decision

Construction, Forestry, Mining and Energy Union

Section 459(3) - jurisdiction of Commission to extend time after the expiry of the 30 day period in s.459(1)(d)(i) including on an application filed after the expiry of that period - meaning of "extend" - appeal against decision [[2013] FWC 1814] and order [PR535112] of Commissioner Bissett at Melbourne on 25 March 2013 in matter number B2013/61.

[1] This is an application for permission to appeal, and if permission is granted, an appeal by EnergyAustralia Yallourn Pty Ltd (Appellant) against a Decision [[2013 FWC 1814] and Order [PR535112] pursuant to s.459(3) of the Fair Work Act 2009 (FW Act) by Commissioner Bissett on 25 March 2013 granting an application by the Construction, Forestry, Mining and Energy Union (union) to extend the 30 day period in s.459(1)(d)(i) in relation to a protection action ballot conducted pursuant to ballot order PR533392.

[2] At the conclusion of the hearing of the appeal we announced our decision to grant permission to appeal but dismiss the appeal and indicated that written reasons would be provided the following day. These are those reasons.

[3] This case concerns protected industrial action that is "employee claim action" within the meaning of s.409 (see s.408(a)). Section 409 specifies the prerequisites for industrial action to constitute "employee claim action". One of those prerequisites is that the industrial action "meets the common requirements set out in Subdivision B" (s.409(1)(d)). Those common requirements are set out in s.413 and include a requirement that:

"(4) The notice requirements set out in section 414 must have been met in relation to the industrial action."

(1) Before a person engages in employee claim action for a proposed enterprise agreement, a bargaining representative of an employee who will be covered by the agreement must give written notice of the action to the employer of the employee.

(b) if a protected action ballot order for the employee claim action specifies a longer period of notice for the purposes of this paragraph - that period of notice.

Notice of employee claim action not to be given until ballot results declared

(3) A notice under subsection (1) must not be given until after the results of the protected action ballot for the employee claim action have been declared.

[5] Section 459 of the Fair Work Act 2009 provides:

"459 Circumstances in which industrial action is authorised by protected action ballot

(1) Industrial action by employees is authorised by a protected action ballot if:

(b) at least 50% of the employees on the roll of voters for the ballot voted in the ballot; and

(c) more than 50% of the valid votes were votes approving the action; and

(i) during the 30 day period starting on the date of the declaration of the results of the ballot; or

(ii) if FWC has extended that period under subsection (3) - during the extended period.

Note: Under Division 2, industrial action by employees for a proposed enterprise agreement (other than employee response action) is not protected industrial action unless it has been authorised in advance by a protected action ballot.

(a) the nature of the proposed industrial action specified in the question or questions put to the employees in the protected action ballot included periods of industrial action of a particular duration; and

(b) the question or questions did not specify that consecutive periods of that industrial action may be organised or engaged in;

then only the first period in a series of consecutive periods of that industrial action is the subject of the ballot for the purposes of paragraph (1)(a).

(3) FWC may extend the 30 day period referred to in subparagraph (1)(d)(i) by up to 30 days if:

(a) an applicant for the protected action ballot order applies to FWC for the period to be extended; and

[6] In this case a protected action ballot was conducted and the results were declared on 14 February 2013. A majority of the balloted employees voted to approve various forms of industrial action. By consent, the ballot order specified a longer period of notice for the purposes of s.414 (7 days). The 30 day period referred to in s.459(1)(d)(i) expired on 15 March 2013. The union gave a series of s.414 notices to EnergyAustralia. A particular form of industrial action included in a notice given on 5 March 2013 had not been taken by 15 March 2013. On 23 March 2013 the union made an application under s.459(3) to extend the 30 day period to 60 days to facilitate the taking of that form of industrial action.

[7] EnergyAustralia opposed the extension application on the basis that, on the proper construction of the FW Act, the Commission had no jurisdiction or power to grant an extension application made after the expiry of the 30 day period referred to in s.459(1)(d)(i). The Commissioner granted the extension application but has yet to deliver detailed written reasons. EnergyAustralia has brought urgent appeal against that decision and associated order.

[8] This issue on which the appeal turns is a narrow question of construction: whether on the proper construction of s.459(3), the Commission's power to extend the 30 day period referred to in s.459(1)(d)(i) can be exercised on an application that is made after that period has expired. Senior Counsel for the Appellant expressly disclaimed any challenge to the exercise of the Commissioner's discretion if the Full Bench determined the construction issue against the Appellant.

[9] There are several decisions of single members of Fair Work Australia that have held that the power to extend in s.459(3) may be exercised after the 30 day period has expired. The issue has not been the subject of consideration by a Full Bench or a Court. In the circumstances, we are satisfied that there is a public interest in a Full Bench considering the issue and, accordingly, we grant permission to appeal. The appeal proceeds as a rehearing albeit that the powers in s.607(3) cannot be exercised in the absence of error (Coal and Allied Operations Pty Ltd v AIRC [2000] HCA 47; (2001) 203 CLR 194 at [17] and [32]).

[10] The Appellant placed primary reliance on what must be accepted is a basic principle of statutory construction as stated by the High Court in Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 at [47] per Hayne, Heydon, Crennan and Kiefel JJ, namely:

"This Court has stated on many occasions that the task of statutory construction must begin with a consideration of the text itself. Historical considerations and extrinsic materials cannot be relied on to displace the clear meaning of the text. The language which has actually been employed in the text of legislation is the surest guide to legislative intention. The meaning of the text may require consideration of the context, which includes the general purpose and policy of a provision, in particular the mischief it is seeking to remedy. "

[11] The Appellant then contended that the ordinary and natural meaning of "extend" and "extended" presupposes the continued existence of the thing being extended. The Appellant contends that when that meaning is adopted, the power in s.459(3) cannot be exercised once the 30 day period in s.459(1)(d)(i) has expired.

[12] We are not persuaded that the ordinary and natural meaning of the words "extend" and "extended" are as narrow as the Appellant contends. Reliance was placed on the definitions in the Macquarie Dictionary and Shorter Oxford English dictionary. Those definitions show that the words have a range of meanings, and certainly no clear and precise meaning in the context in which they appear in s.459.

[13] In Esso Research & Engineering Co v Commissioner of Patents [1960] HCA 31; (1960) 102 CLR 347 Fullagar J observed (at pp 351-2):

"I think I would concede that a provision for "extending" a prescribed period during which a thing may be done should prima facie be construed as operating only while the originally prescribed period is still current. It may even be said that, when the originally prescribed period has expired, there is nothing to "extend". But, while this view may be said to represent the most natural meaning of the word "extend", that word is by no means incapable of a wider reference. It is by no means a misuse of language to speak of what is really the prescription of a new period as an "extension" of the period originally prescribed. Cases are numerous in which the conferring on a tribunal of a power to "extend" the time for doing a thing is accompanied by an express provision that an "extension" may be granted although the originally prescribed period has expired. ... While these cases suggest that a power to extend time without more is prima facie to be regarded as a power to extend a period still current, they also indicate that an enlargement of time after the expiration of a prescribed period is quite naturally regarded as itself an "extension".

Section 53(2) must, in my opinion, be construed as enlarging the time for acceptance on the institution of an appeal, whether or not, on the date of the institution of the appeal, the original period prescribed by s. 53(1) has expired. The language used is, as I have said, quite capable of this meaning. To adopt it involves no distortion, no attribution of an unnatural meaning to any word. And it seems to me to be a decisive consideration that sub-ss. (2) and (3) of s. 53 were obviously intended for the protection of applicants desiring to exercise the right of appeal given in unqualified terms by s. 52(3). It is obviously for the purpose of preventing an applicant for a patent from being deprived of his rights by s. 54 that sub-s. (1) of s. 53 is expressly made subject to sub-ss. (2) and (3) of that section. If the narrower construction of those two sub-sections were adopted, the protection in a large number of cases would be altogether illusory. Where two constructions of an enactment are fairly open, and one will achieve the obvious purpose of the legislature while the other will in many cases defeat it, the former construction is to be preferred. This is the rule which should, in my opinion, govern the present case, and I overrule the preliminary objection."

[14] In Sanofi v Parke Davis Pty Ltd (No 2) [1983] HCA 32; (1983) 152 CLR 1 Mason ACJ, Wilson and Dawson JJ said (at p 8):

"...the words "extended" or "extension" are not defined in the Act. Their meaning may well vary with the nature of the subject matter, as Deane J. observed in his judgment. The Shorter Oxford English Dictionary includes among the meanings of "extension" the phrase "enlargement in length, duration, area or scope". It is not an abuse of language to speak of the retrospective enlargement of the term of a monopoly as an extension of such a monopoly. In any event, in our opinion, Pt IX supplies its own dictionary of both "patentee" and "extended", as we explain in our next two points."

[15] The Appellant relied on a series of examples of statutes and rules where express provision is made for extension of a time period after the expiry of that period. Totally consistent legislative drafting may be a fine idea, however, it does not exist in the real world. As the decisions in Esso and Sanofi demonstrate, there is no established rule of construction that a statutory power to "extend" a period cannot be exercised after the expiry of the period unless the decision maker is expressly empowered to do so.

[16] Moreover, we consider that Fullagar J's reasoning in Esso is equally applicable in the present case. To adapt his Honour's words, an enlargement of time after the expiration of a prescribed period is quite naturally regarded as itself an "extension". The language of s.459 is quite capable of this meaning. To adopt it involves no distortion, no attribution of an unnatural meaning to any word of s.459. This conclusion is driven by a consideration of statutory context and legislative purpose.

[17] Section 459 is expressly concerned with the "Circumstances in which industrial action is authorised by [a] protected action ballot". It appears within Division 8 of Part 3-3. Part 3-3 established a regime to regulate the taking of industrial action. A detailed summary of the provisions would be unduly time-consuming. A broader summary will suffice (a detailed analysis of the provisions can be found in Transport Workers Union of Australia [2011] FWA 1097 (Lewin C)).

[18] The object in s.3(f) is "achieving productivity and fairness through an emphasis on enterprise level collective bargaining underpinned by simple good faith bargaining obligations and clear rules governing industrial action". The FW Act effectively authorises the taking of industrial action that is "protected industrial action" in support of negotiations for an enterprise agreement. All industrial action that is not "protected industrial action" is prohibited and amendable to orders, the breach of which can lead to substantial civil penalties. The FW Act specifies a range of requirements that must be satisfied before industrial action can be "protected industrial action". There are limitations around how and when protected industrial action can be taken. Importantly,

(a) Protected industrial action cannot be taken unless it has first been authorised through a "process that will allow employees to choose, by means of a fair and democratic secret ballot, whether to authorise protected industrial action for a proposed enterprise agreement." (s.406). The object of Division 8, in which s.459 appears, is "to establish a fair, simple and democratic process to allow a bargaining representative to determine whether employees wish to engage in particular protected industrial action for a proposed enterprise agreement." (s.436).

(b) Protected industrial action cannot be taken unless the notice requirements in s.414 have been satisfied. The purpose of a notice of intention to take protected industrial action specifying the nature of the action to be taken was explained by Wilcox and Cooper JJ in Davids Distribution Pty Ltd v National Union of Workers [1999] FCA 1108; (1999) 91 IR 198 at [84]:

"We think s170MO(5) [a predecessor of s.414] was designed to ensure that industrial disputants who are to become affected by protected action, in relation to which their usual legal rights are significantly diminished, are at least able to take appropriate defensive action. For example, an employer may operate a sophisticated item of equipment that will be damaged if precipitately shut down. If warned in advance of a ban that might affect the continued operation of that plant, the employer might choose a controlled shut down during the period of the notice. More commonly, perhaps, an employer might use the notice time to communicate with suppliers and customers, and thereby reduce the consequences for them of the notified industrial action. Very often, the recipient of the notice will respond in a way that has a legal dimension. For example, a union might react to a notice by an employer of intent to lockout some employees by giving notice that all employees will strike indefinitely as from the commencement of the lockout. Similarly, an employer might respond to an employees' notice of bans by giving notice of a lockout of some or all employees."

[19] The purpose of the limitation in s.459(1)(d), that is, industrial action by employees "cannot be authorised by a protected action ballot" if it is not commenced within a period of between 30 and 60 days after the declaration of the ballot, is not identified in the relevant explanatory memorandum. Nevertheless, the effect of s.459(1)(d) is clear: once a ballot has been conducted and a particular form of action authorised, the employees must "use it or lose it". However, there is no prohibition in the FW Act on an employee bargaining representative seeking a further authorisation of particular forms of action through a further protected action ballot. The best inference is that the prohibition in s.459(2) was intended to ensure that the authorisation arising from a protected action ballot could be relied upon in relation to the institution of a particular form of action only if the authorisation remained relatively fresh.

[20] In that context it would be sensible to confer a discretion on the Commission to address the merits of particular circumstances where it may be unfair or otherwise inappropriate to hold an employee bargaining representative strictly to the 30 day time limit in s.459(1)(d)(i) and impose upon them (and the employees they represent) the cost, delay and inconvenience of going back to scratch and making a fresh application for a new protected action ballot.

[21] There will be many cases where it would be entirely conducive to the purposes and objects of the FW Act, and Part 3-3 in particular, for the 30 period to be extended. In many cases it will be clear on evidence that majority employee support for the action in question continues to exist and that resort to the species of protected industrial action will be a legitimate way of seeking to achieve agreement where bargaining has stalled. The regime for authorisation by a protected action ballot is intended to be a "fair, simple and democratic process". It is a feature of the regime that it may be utilised by ordinary employees as bargaining representatives (and not merely unions) and was intended for use by ordinary practical people as distinct from trained lawyers (compare Davids Distribution Pty Ltd v National Union of Workers [1999] FCA 1108; (1999) 91 IR 198 at [83] and Kucks v CSR Limited [1996] IRCA 166; (1996) 66 IR 182 at 184).

[22] The construction advanced by the Appellant would be likely to lead to a greater and sometimes unnecessary resort to protected industrial action. As the expiry of the 30 day period approaches, there will be a natural incentive for a union bargaining representative to initiate forms of protected industrial action authorised by a protected action ballot that have not yet been utilised in order to preserve their availability for future use in the bargaining, even if bargaining is progressing satisfactorily and appears likely to be successful without resort to action of that type. A prudent bargaining representative will take account of the possibility that bargaining may not be successful without resort to such protected industrial action. The construction for which the union contends it better attuned to the objects of the Act. We endorse the observations of O'Callaghan SDP in National Union of Workers v Symbion Pharmacy [2009] FWA 1284 at [10] and of Hampton C in Maritime Union of Australia v DP World Adelaide Pty Ltd [2010] FWA 7638 at [36].

[23] In Streimer v Tamas (1981) 54 FLR 253 the Full Court of the Federal Court was concerned with s.41(6A) of the Bankruptcy Act 1966 (Cth) that provided:

"(6A) Where, before the expiration of the time fixed by the Court or the Registrar for compliance with the requirements of a bankruptcy notice -

(a) proceedings to set aside the judgment or order in respect of which the bankruptcy notice was issued have been instituted by the debtor; or

(b) an application to set aside the bankruptcy notice has been filed with the Registrar,

the Court may, subject to sub-section (6C), extend the time for compliance with the bankruptcy notice."

"Section 41 (6A) introduced into Commonwealth bankruptcy legislation, for the first time, express provision on the subject of extending the time for compliance with the requirements of a bankruptcy notice. The Parliament plainly turned its attention to the question of what steps needed to be taken before the expiry of the time which the bankruptcy notice fixed for compliance with its terms. It specified two alternative steps, namely, the institution of proceedings to set aside the relevant judgment or order or the filing of an application to set aside the bankruptcy notice. Subject to either of those steps being taken within the time limited for compliance, the power to extend time is conferred in general words. It would, in our view, be contrary to the plain import of the words used by the Parliament to construe s 41 (6A) as requiring not only that one or other of the alternative express conditions precedent to jurisdiction be fulfilled within the time originally fixed for compliance but as also requiring that both the application for an order and any initial order be made within that time. Indeed, such a constricted construction would render otiose a large part of the subsection, namely, the words "before the expiration of the time fixed by the Court or the Registrar for compliance with the requirements of a bankruptcy notice"."

[25] Streimer v Tamas has been cited with apparent approval by the High Court in Guss v Johnston (2000) 74 ALJR 884 (at paras [58] and [63]). In the same way here, the legislature turned its mind to preconditions to an exercise of the power to extend conferred by and specified preconditions in s.459(3)(a) and (b). It would have been a simple matter to specify that as a further requirement that the three month period had not expired. It did not do so.

[26] The Appellant also relied upon the prospect of an extension order having retrospective effect to confer protection on industrial action taken after the expiry of the 30 day period but before the extension order was made. An equivalent argument did not persuade the Full Court in Streimer v Tamas to a different construction. More importantly, we are not persuaded that, on the proper construction of s.459(1)(d), an extension order would retrospectively confer protection on industrial action that was unprotected at the time it was taken. Section 459(1)(d) focuses on when action "commences". Conformably with the objects and purpose of the FW Act, the condition in s.459(1)(d)(ii) - "if FWC has extended [the 30 day period]" - should, on its proper construction, be tested as at the time the action commences. If there was no extension order at that time, the action will not be authorised under s.459.

[27] For all these reasons we conclude that the power conferred by s.459(3) may be exercised after the 30 day period in s.459(1)(d)(i) has expired, including in respect of an application made after the expiry of the 30 day period. If follows that the appeal must fail and we dismiss it.

S Wood, Senior Council, B Jellis of Counsel with K Lehane for the Appellant.

S Crawshaw, Senior Council, R Reitano of Counsel with P Pasfield for the Respondent.

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