s.240 - Bargaining dispute

Australian Municipal, Administrative, Clerical and Services Union

Alleged dispute concerning a proposed enterprise agreement.

[1] On 4 December 2025 an application was made by the Australin Services Union Victorian/Tasmanian Authorities and Services Branch (ASU) pursuant to s.240 of the Fair Work Act 2009 (Cth) (the Act) to have the Fair Work Commission (Commission) deal with a bargaining dispute in relation a proposed enterprise agreement (Proposed Agreement). The respondent to the application is Derwent Valley Council (Council).

[2] Bargaining was initiated on 1 May 2024. On 10 May 2024, Council issued the Notice of Employee Representational Rights. The parties engaged in a series of bargaining meetings held between June 2024 and March 2025.

• [3] On 26 March 2025, Council indicated it would put the Proposed Agreement to the vote. The ASU objected to this course of action and in response filed a protected action ballot order application which was granted by this Commission.[1]

[4] On 15 August 2025, the results of the protected action ballot vote were released for which the majority of employees eligible to vote endorsed the taking of protected industrial action. On 28 August 2025, the ASU notified Council of its intention to take protected industrial action.

[5] On 16 and 17 October 2025, Council put the Proposed Agreement to the vote of all eligible employees. The vote was unsuccessful.

[6] At the time of making its application the majority of the ASU's claims had been resolved however the Parties were unable to reach agreement on the wage outcome and sought the assistance of this Commission. Although the ASU and Council were unable to reach agreement on the wage outcome, the parties agreed that they had been bargaining in good faith and genuinely trying to reach agreement.

[7] The Commission conducted conferences on 8 January 2025 and 24 February 2026. The conferences were attended by ASU, individual bargaining representatives and representatives from Council. Council was represented by a lawyer, Ms Kelsey Allen.

[8] At the conference held on 8 January 2026, Council made submissions about its financial position being that it was running at a serious operating deficit with cash flow challenges, consequently they were unable to meet the ASU's wage claim. Council also submitted it had engaged a new Chief Executive Officer to assist with securing Council's capacity for future operations.

[9] At the conclusion of the conference Council was directed to provide to the Commission and the ASU a report on its financial status and Mr Wes Young, the Chief Executive Officer was directed to attend a conference to be held on the 24 February 2026. Council complied with the directions, and its compliance enabled the parties to have meaningful and constructive discussions. At the conclusion of the conference the parties consented to the Commission issuing the following Recommendation.

[10] Council was subject to a financial audit by its Audit Panel, and the Audit Panel has raised concerns about the Council's financial sustainability. During the conference held on 24 February 2026 Council produced a copy of its Monthly Financial Report for January 2026 which was prepared by Council based on the audit Panel's comments and concerns and Mr Young's recommendations to address those concerns.

[11] It is not in contention that Council's financial sustainability is presently at risk. The critical risk is that it potentially has insufficient funds to cover 2-3 months of operations. If Council falls below that threshold, Mr Young is obligated to inform the Minister for Local Government. For Council to remain solvent Mr Young has recommended that there be a reduction in both operating and capital programs' expenditure. Mr Young has also recommended that the Councillors adopt the recommendations in the Audit Report.

[12] During bargaining the ASU sought a wage increase of 5% or CPI (whichever was greater). After considering the Councils submissions and its counter offer of 2.1%, the ASU revised its wage claim to 3.8% to take effect from the first pay period in July 2026. Council maintained they could only afford 2.1% and submitted that if finances improved sufficiently prior to bargaining recommencing on 1 February 2027, there may be capacity to provide the additional 1.7%.

[13] The ASU contends that Council has sufficiently demonstrated that its current financial position would not sustain the wage increase sought. The ASU and Council have agreed that Council will engage with the ASU during its financial year 2026/2027 budget planning process. The ASU will make submissions on proposed wage increases to Council during the budget process and prior to negotiations recommencing, including the proposed 1.7% wage increase.

[14] Therefore, in all the circumstances, the Commission makes the following recommendations in respect of the remaining matters in dispute:

1. Bargaining for the new enterprise agreement will be suspended until 1 February 2027;
2. Employees covered by the proposed Agreement will receive a wage increase of 2.1% to take effect from the first pay period after 1 July 2026; and
3. Council will call for public submissions for the 2026/27 operating and capital budget. All public submissions will be required to have regard to Council's Strategic Plan. The ASU may make submissions on behalf of their members during this process.

[15] The Parties agree that prior to the recommencement of negotiations they will file an application with this Commission to seek further assistance with the negotiation of the Proposed Enterprise Agreement.

[16] In conclusion, I commend the Parties and their representatives for their pragmatic and collaborative approach to reaching a resolution in this matter. The s.240 dispute application is now resolved.

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