s.437 - Protected action

Australian Manufacturing Workers' Union and Australian Workers' Union

Proposed protected action ballots of employees of Kempe Services Pty Ltd - application for extended notice period declined - orders issued

• [1] Earlier this afternoon I issued protected action ballot orders for reasons briefly summarised on transcript. I now publish my reasons.

• [2] This decision concerns an application made on 18 February 2025 by the Australian Manufacturing Workers' Union (AMWU), and an application made on 19 February 2025 by the Australian Workers' Union (AWU), under s 437 of the Fair Work Act 2009 (Act) for protected action ballot orders in relation to employees of Kempe Services Pty Ltd (Kempe). Kempe advised the Commission that it did not seek to be heard in relation to whether the orders should be issued. However, it contended that the Commission should specify, under s 443(5), an extended notice period for the taking of certain protected industrial action of 7 working days.

• [3] The AMWU's application and F34B declaration made by Stephen Fodrocy, its industrial officer, indicated that the employees to be balloted were employees of Kempe who will be covered by a proposed enterprise agreement and who are represented by the AMWU. The employees in question are maintenance employees currently covered by the Kempe Engineering Portland Enterprise Agreement 2022 (2022 Agreement). The nominal expiry date of the 2022 Agreement was 31 December 2024. The proposed ballot agent is the Australian Electoral Commission (AEC). A draft order was attached to the application. The proposed ballot would ask employees whether they support different forms of industrial action for the purposes of supporting claims made in respect of the proposed agreement. The proposed date by which voting in the protected action ballot would close is 30 days from the date the order is made by the Commission. The AWU's application and F34B declaration made by Karl Millard, its organiser, were in similar terms. The declarations filed by the unions state that the 'notification time' for the proposed agreement was 4 December 2024, and that the unions served logs of claim on Kempe in late October 2024. Several bargaining meetings have taken place. It is clear that the AMWU and the AWU have been and are genuinely trying to reach an agreement with Kempe.

• [4] The point of contention between the parties was Kempe's application that the Commission specify in the protected action ballot orders that the unions must give Kempe 7 working days' notice of any 4 hour and 12 hour stoppages of work, which were contemplated by questions 3 and 4 in the proposed ballot orders. The unions resisted this application and maintained that the orders should not specify a longer notice period, such that the default period of 3 working days' notice would need to be given, as prescribed by s 414(2)(a)(i) of the Act.

• [5] Section 443(5) states that if the Commission is satisfied, in relation to proposed industrial action that is the subject of the protected action ballot, that there are exceptional circumstances justifying the period of written notice referred to in s 414(2)(a) being longer than 3 working days, the protected action ballot order may specify a longer notice period of up to 7 working days. The Commission must have a sound basis for any state of satisfaction it reaches under this provision. I adopt the approach of the Full Bench in National Tertiary Education Union v Charles Darwin University [2018] FWCFB 4011 at [21]- [25].

• [6] Kempe contends that, based on the evidence of Ted Pundij, its operations director and lead negotiator, the Commission should be satisfied that there are exceptional circumstances justifying the longer notice period it seeks. Mr Pundij said that Kempe is a specialist engineering company that provides maintenance and other services to clients, which include Portland Aluminium. Kempe provides workshop services and supplies spare parts and on-site maintenance to the Portland Aluminium smelter. Mr Pundij said that on his understanding, the smelter uses some 10% of Victoria's electricity supply, and that it acts as a virtual battery for the power grid to stabilise demand which helps to prevent blackouts. The smelter participates in the Reliability and Emergency Reserve Trader scheme set up by the Australian Energy Market Operator to maintain power system reliability. Mr Pundij said that a shutdown or disruption to work at the smelter would, on his understanding, have the potential to impact Victoria's electricity supply.

• [7] Mr Pundij said that Kempe is contracted to service and repair 'crustbreaker feeders' and 'hydraulic cylinders'. These parts come in racks of 11 and are in short supply as they are changed frequently. Each 'pot' uses four feeders and faulty feeders are replaced during operations to ensure stability of the pot. Mr Pundij said that 3 to 4 feeders are repaired each day, and that it takes Kempe some 3 days to return a rack of feeder cylinders to the smelter. He said that this is specialised work, and that his understanding was that Portland Aluminium would not be able to source such maintenance from elsewhere at short notice. He said that he was concerned that any stoppage of work had the potential to impact Kempe's ability to provide the critical maintenance and parts for the smelter which are necessary to keep it operational. He said that this could in turn give rise to a pot line shutdown which had the potential to impact the smelter's operational capacity and the stability of Victoria's electricity supply.

• [8] Mr Pundij said that in addition to replacing or fabricating necessary parts, Kempe is also currently contracted by Portland Aluminium to perform essential structural integrity safety work, and that he understood from discussions with management of the smelter that these works were commissioned following WorkSafe improvement notices and are time critical, and that stoppages of work could jeopardise their timely completion and put workers' safety at risk.

• [9] The unions contended that the evidence put before the Commission by Kempe did not substantiate its contention that there were exceptional circumstances in this case, or that the longer notice period it sought was justified. It said that Kempe's concern about the possible effects of industrial action on the operation of the smelter and the electricity supply were speculative, and that the AMWU's evidence indicated that Portland Aluminium could source labour from elsewhere. The unions submitted that the company's application for a longer notice period should be rejected.

• [10] I am not satisfied that there are exceptional circumstances in the present case that would justify a longer notice period as sought by Kempe. I accept that Kempe provides specialised technical and maintenance services to the Portland smelter, the continuous operation of which is important for the stability of the electricity supply in the State of Victoria. However, I am not satisfied that the industrial action foreshadowed in the draft protected action ballot orders would, if taken, warrant the longer period of notice sought by Kempe. In particular, I am not satisfied that the stoppages of work described in questions 3 and 4 would pose any significant risk to the operation of the smelter or the stability of the electricity supply. First, there was no evidence of stoppages of work having previously impacted the smelter's operating capacity or having posed a risk to the electricity supply. Secondly, the concern about this possibility was one held by Mr Pundij. There was no evidence of Portland Aluminium having such a concern. Thirdly, while it was Mr Pundij's understanding that Portland Aluminium could not source alternative labour quickly, this was not the view of Tony Hynds, the AMWU's organiser, who referred to another relevant contractor engaged at the smelter and noted that Portland Aluminium has 30 of its own maintenance staff. I am not satisfied that Portland Aluminium cannot source alternative labour either at all or in time. Fourthly and more generally, it is not known what contingencies Portland Aluminium may be able to put in place to respond to stoppages of work that are taken by employees of Kempe. As to the maintenance work, I accept that this is important work that is responsive to WorkSafe concerns, but the nature of the safety risks is not known, nor is it clear how they would be affected by the industrial action.

• [11] In my view the evidence does not establish that there are exceptional circumstances in this case. To the extent that the circumstances might be considered exceptional, I am not persuaded that they justify a 7 working day notice period as sought by Kempe. For these reasons, I declined to specify a longer notice period.

• [12] At the time of issuing the order, I was satisfied that there was a notification time in relation to the proposed agreement (see s 437(2A)), that a valid application had been made, and that the AMWU and the AWU had been, and were, genuinely trying to reach an agreement with Kempe (see s 443(1)). I was therefore required by s 443 to make a protected action ballot order. For the purposes of s 443(3)(c), I determined that the date by which voting will close is 24 March 2025. This also establishes the ballot period for the purpose of s 448A(2) of the Act. The protected action ballot orders were issued separately in PR784576 and PR784653.

• [13] Further orders will be issued shortly under s 448A requiring the attendance of all bargaining representatives at a conciliation conference, together with directions to ensure that the parties attend the conference ready to conduct meaningful negotiations.

Printed by authority of the Commonwealth Government Printer