s.437 - Protected action

Proposed protected action ballot of employees of Jadestone Energy (Australia) Pty Ltd - whether applicant genuinely trying to reach an agreement - whether ballot questions sufficiently specific - whether employees to be balloted are identified - whether extension of time for notice of action under s 414(2) justified

[1] Jadestone Energy (Australia) Pty Ltd (the Company) is an oil company with two operating sites in Australia. One of the operating sites is the Montara Venture Floating Production, Storage and Offtake facility (FPSO). This FPSO is located approximately 690 km west of Darwin, 630 km north of Broome and 250 km north-west off the remote Kimberley coast of Western Australia.

[2] The Company has been negotiating for an enterprise agreement since 10 December 2019. There is currently no enterprise agreement in place. The terms and conditions of employment for the relevant employees are governed by common law contracts. Those contracts derive their terms from previous enterprise agreements which covered the workforce when the FPSO was owned by the former employer. At that time, there were two enterprise agreements in place covering the operational crew. One of the agreements covered the Australian Workers' Union (the AWU) and the Maritime Union of Australia (as it was then), and the other drew the Australian Institute of Marine and Power Engineers (the AIMPE) into its coverage. The parties to this application agreed that neither agreement transferred when the Company purchased the FPSO.

[3] Around March 2020, bargaining for an agreement was paused for a period because of the Covid-19 pandemic and its implications for the operation. Negotiations recommenced recently, and now the AWU has applied under s 437 of the Fair Work Act 2009 (Cth) (the Act) for a protected action ballot order. The application is in relation to certain employees of the Company who are members of the AWU.

[4] The Company objected to the application on several grounds. The primary grounds of objection were:

1. the AWU has not identified, as required by s 437(3)(a) of the Act, the actual employee(s) or groups of employees that would be subject to the protected action ballot order;

2. the AWU is not genuinely trying to reach an agreement;

3. question 5 of section 5 of the proposed protected action ballot order would result in a full tanker of oil for indefinite periods - a scenario not contemplated in the Company's governing regulatory document (Safety Case) and would therefore potentially be in breach of the Company's licence to operate;

4. the proposed industrial action is disproportionate given that the Company is small and its viability heavily relies on each offtake and associated cash flow; and

5. the consequences of a prolonged shut down of the oil field, resulting from the inability to undertake offtakes, may result in the reduced ultimate recovery of the oil reserves, impacting the long term viability of the FPSO, and the recovery of State and Federal taxes and royalties.

[5] There were, in addition, submissions that the AWU had failed to properly specify the ballot questions such that ballot questions 3 and 4 on the 'Draft Order' were vague, and that the period for the notice (see s 414(2)(a)) should be extended.

[6] The matter was allocated to my Chambers on 3 September 2020 and heard on 4 September 2020. The application was properly made. I was satisfied at the time of making the order that there had been a 'notification time' in relation to the proposed agreement and there was no dispute that both the Company and the AEC received the application within the requisite statutory period. I reserved my decision, informing the parties that they would be notified shortly thereafter.

[7] Having considered all materials filed and the evidence given in this matter, as well as the submissions of the parties, I concluded that the requirements for the making of a protected action ballot order had been met. Accordingly, the Commission was required under s 443 of the Act to make a protected action ballot order. However, I removed the two offending questions (questions 3 and 4 of the Draft Order) due to their ambiguity and was satisfied that there were exceptional circumstances that warranted extending the period for notice (s 414). The Order[1] was issued on 4 September 2020 and reflected these changes, in addition to an amendment to the group of employees named in the Draft Order. My reasons for that Order now follow.

[8] Mr Owen Hobbs provided evidence on behalf of the Company. He purports to have been working for the Company since June 2019 but has 35 years of operational experience in the oil and gas industry. Most recently, prior to his appointment with the Company as Country Manager, he was the GM Operations for Origin Energy.[2]

[9] The Company purchased the Montara Venture FPSO in July 2018. It was granted operational control on 6 August 2019 by 'NOPSEMA'.[3]

[10] The FPSO is a remote facility. Pre-Covid-19, employees would typically gather at Darwin in the afternoon/evening on a Monday. On the Tuesday morning, they would board a private charter fixed-wing flight to Truscott Airbase (a one hour flight). From Truscott, they were transferred to the FPSO by helicopter; a flight of 75 minutes in duration.[4]

[11] The Company employs 59 employees, including 10 in leadership roles.[5] There are 49 employees in operational, maintenance, engineering and general service roles, who would have their employment regulated by an enterprise agreement. At any one time, there are 18-20 employees on the facility.[6]

[12] Since Covid-19, the travel logistics for the Company have changed. Mr Hobbs stated that the Company was dependent on using a helicopter to transfer employees directly from Darwin to the FPSO. Whilst there was an arrangement in place to use the helicopter, that helicopter was allocated to another company. As a consequence, the Company was securing the use of the helicopter on a month by month basis. Further, with border restrictions imposed in Western Australia, the roster for employees had changed and now incorporated a two week quarantine period in Darwin before mobilising to the FPSO.

[13] Mr Hobbs gave evidence that the notice of employee representational rights was issued on 10 December 2019.[7] On 21 February 2020, the first bargaining meeting was held with representatives of the AWU, the AIMPE and the AMOU in attendance.[8] The AWU submits that it provided its log of claims at this first meeting - there was no contention to the contrary.

[14] On 19 March 2020, the Company issued an email to representatives of the CFMMEU, the AIMPE, the AMOU and the AWU, among other recipients, stating to the effect that the circumstances surrounding the coronavirus outbreak and restrictions on travel had given rise to the decision to postpone upcoming negotiations until further notice.[9]

[15] By 23 June 2020, bargaining meetings had resumed, and further meetings took place on 1 July 2020, 29 July 2020, and 18 August 2020.[10] A further meeting was, according to Mr Hobbs, scheduled for 15 September 2020.[11] Mr Hobbs expressed the view that the AWU had declined to acknowledge and discuss the impact of low world oil prices on the Company and its needs to moderate labour related costs to maintain the viability of the Company.

[16] Mr Douglas Heath, an Organiser for the AWU, provided evidence on behalf of the AWU. He said that the Company and the AWU had agreed upon the proposed area and scope of the enterprise agreement, and the employees to whom it would apply by reference to the classifications listed at paragraph 32 of this decision.[12] Mr Heath said that the classifications used currently applied to the employees on the FPSO and, in this respect, referred to a training and certification matrix (see Exhibit DH-2). Whether cooks and caterers would be included within the scope had, said Mr Heath, not yet been decided.[13]

[17] Pursuant to s 443, the Commission is obliged to issue a protected ballot order only in the following circumstances:

1. When the FWC must make a protected action ballot order

(1) The FWC must make a protected action ballot order in relation to a proposed enterprise agreement if:

(a) an application has been made under section 437; and

(b) the FWC is satisfied that each applicant has been, and is, genuinely trying to reach an agreement with the employer of the employees who are to be balloted.

(2) The FWC must not make a protected action ballot order in relation to a proposed enterprise agreement except in the circumstances referred to in subsection (1).

(3) A protected action ballot order must specify the following:

(b) the group or groups of employees who are to be balloted;

(c) the date by which voting in the protected action ballot closes;

(d) the question or questions to be put to the employees who are to be balloted, including the nature of the proposed industrial action.

(3A) For the purposes of paragraph (3)(c), the FWC must specify a date that will enable the protected action ballot to be conducted as expeditiously as practicable.

(4) If the FWC decides that a person other than the Australian Electoral Commission is to be the protected action ballot agent for the protected action ballot, the protected action ballot order must also specify:

(a) the person that the FWC decides, under subsection 444(1), is to be the protected action ballot agent; and

(b) the person (if any) that the FWC decides, under subsection 444(3), is to be the independent advisor for the ballot.

(5) If the FWC is satisfied, in relation to the 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 paragraph 414(2)(a) being longer than 3 working days, the protected action ballot order may specify a longer period of up to 7 working days.

Note: Under subsection 414(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.

[18] Section 437 of the Act relevantly provides as follows:

437 Application for a protected action ballot order

Who may apply for a protected action ballot order

(1) A bargaining representative of an employee who will be covered by a proposed enterprise agreement, or 2 or more such bargaining representatives (acting jointly), may apply to the FWC for an order (a protected action ballot order) requiring a protected action ballot to be conducted to determine whether employees wish to engage in particular protected industrial action for the agreement.

(2) Subsection (1) does not apply if the proposed enterprise agreement is:

(2A) Subsection (1) does not apply unless there has been a notification time in relation to the proposed enterprise agreement.

Note: For notification time, see subsection 173(2). Protected industrial action cannot be taken until after bargaining has commenced (including where the scope of the proposed enterprise agreement is the only matter in dispute).

(a) the group or groups of employees who are to be balloted; and

(b) the question or questions to be put to the employees who are to be balloted, including the nature of the proposed industrial action.

(4) If the applicant wishes a person other than the Australian Electoral Commission to be the protected action ballot agent for the protected action ballot, the application must specify the name of the person.

Note: The protected action ballot agent will be the Australian Electoral Commission unless the FWC specifies another person in the protected action ballot order as the protected action ballot agent (see subsection 443(4)).

(5) If A group of employees specified under paragraph (3)(a) is taken to include only employees who:

(a) will be covered by the proposed enterprise agreement; and

(i) are represented by a bargaining representative who is an applicant for the protected action ballot order; or

(ii) are bargaining representatives for themselves but are members of an employee organisation that is an applicant for the protected action ballot order.

(6) The application must be accompanied by any documents and other information prescribed by the regulations.

The AWU has not identified the group of employees as required by s 437(3)(a)

[19] The Company advanced that the application had not specified the group or groups of employees who are to be balloted, notwithstanding that the application in this respect had stated:

In accordance with s 437(5) of the Act, the employees to be balloted are those employees of Jadestone Energy (Australia) Pty Ltd who will be covered by the proposed enterprise agreement and are represented by The Australian Workers' Union.[14]

[20] In its submissions in reply, the Union sought to vary or amend its application (and/or the proposed Draft Order) so as to clarify that the group was:

...[E]mployees in operational, maintenance, engineering and service roles.

[21] The AWU clarified that it did not seek to cover Deck Officers or those in leadership roles.

[22] As noted in the background, the AWU, the AIMPE and the AMOU have been bargaining for the agreement. The Company submitted that it was remarkable that whilst the negotiations had involved two other unions, the AWU had not notified those unions of the application, even though they were said to be bargaining representatives for the proposed agreement. Further, the Company referred to there being a demarcation dispute regarding 'coverage', advancing that the AWU was using this process (presumedly the making of the application) as a stalking horse for its constitutional ambitions to effectively take over those employees falling within the constitutional rule of the AIMPE. It was on this basis that the Company said the AWU was involved in a misuse of process and drew reference to s 176.

[23] Essentially, the Company appeared to be levelling an assertion at the AWU that the AWU was seeking to cover, under its eligibility rules, Marine Engineers by making the application, when it was long accepted that the AWU did not have coverage of this group, but the AIMPE did.

[24] Section 176 of the Act specifies who are bargaining representatives for the purpose of the Act. Regarding employee organisations, s 176(b) provides that the employee organisation is a bargaining representative of an employee who will be covered by the agreement if the employee is a member of the organisation. The other provisions in that subsection are irrelevant for current purposes. However, s 176(3) spells out a requirement relating to employee organisations or an official of an employee organisation, namely they cannot be 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.

[25] Section 176(3) and its requirements relate to the current dispute. This is because s 437(3) of the Act stipulates that the application for a protected action ballot order must specify the group or groups of employees who are to be balloted. Thereafter, s 437(5) provides that the employees specified under s 437(3) are taken to include only employees who will be covered by the proposed agreement and are represented by a bargaining representative who is an applicant for the proposed protected action ballot order.

[26] To determine if the AWU is entitled to represent the industrial interests of the employee group in relation to the work that will be performed under the agreement, consideration of the relevant union eligibility rule is required. Such consideration requires the adoption of the proper construction of the union eligibility rules. This is _'_a legal question to be solved by legal considerations'.[15] The basic principles governing the construction of union eligibility rules are well established and need not be repeated in full here. However, an eligibility rule of an organisation must, like any other document, be interpreted according to its ordinary and natural meaning, and recourse may be had to extrinsic material only where there is ambiguity or uncertainty as to the construction or meaning of the rule.[16]

[27] The Courts and the Commission have long recognised two particular categories of eligibility rule:

1. rules based on the industry in which the business or enterprise of the employer operates (such a rule is referred to as an 'industry rule');

b) rules based on the type of work performed by employees (such a rule is usually referred to as a 'vocational rule' and sometimes referred to as a trade, craft or calling rule).[17]

[28] To support its contention, that it was entitled to represent the industrial interests of the named group of employees, the AWU referred the Commission to the 'Rules of The Australian Workers' Union', Rule 5, Section 1, Part A:

• (i) Every bona fide worker, male or female, engaged in manual or mental labour in or in connection with any of the following industries or callings, namely: ...

the search and/or drilling for hydrocarbons, the production, processing and transmission of hydrocarbons, the prospecting, surveying, exploration and drilling for minerals and metals (except as to members of organisations in the shipping industry):

[29] The Company argued that the more general industry rule in the Rules of the AWU should give way to the specific rule in the Rules of The Australian Institute of Marine and Power Engineers, that provided that the AIMPE was entitled to represent the industrial interests of Marine Engineers. When one considers the Company's submission, it appears to be the case that the argument is that the vocational rule in the Rules of The Australian Institute of Marine and Power Engineers, which provides that the AIMPE is entitled to represent the interests of various engineers on different craft, operates to the exclusion of the industry rule in the Rules of the AWU. With respect to the craft involved, the AWU pursued a line of questioning and submission concerning whether the vessel was self-propelled. However, there was little in the way of probative evidence placed before me on this point.

[30] Rule 6B, of the Rules of The Australian Workers' Union, was brought to the attention of the parties. It is a rule that was said to provide additional eligibility for admission to membership of the AWU in Western Australia. Both parties provided little in the way of cogent submission concerning the rule's operation. Rule 6B provides:

This Rule 6B does not apply outside the State of Western Australia.

Notwithstanding the foregoing rules, and without limiting the generality of those rules, and without being limited thereby, the following provisions of this Rule 6B provides for additional eligibility for admission to membership of the Union in the State of Western Australia.

(20)(a) Boring for oil, refining, treating, processing, packing, pumping, and all work whatsoever in or in connection with the boring for oil, refining, treating, processing, packing and pumping of oil, and the manufacture (including the extraction) of the by-products of oil, when such manufacture (including extraction) is incidental to and consequent upon the refining of oil carried on by a company whose principal business is oil refining; Provided that workers who are employed in the following vocations shall not be eligible for membership: Fitters, Coppersmiths, Turners, Patternmakers, Tool and Gauge makers, Scalemakers and adjusters, Blacksmiths, Shipsmiths, Toolsmiths, Angle-Iron Smiths, Springmakers, Millwrights, Oxy-acetylene and Electric Welders and Cutters, Locksmiths, Mechanical and Scientific Instrument Makers, Motor Mechanics, Motor Cycle Mechanics, Aircraft Mechanics, Die Sinkers, Press Tool Makers, Milling Machinists, Bolt and Nut Machinists, Drilling Machinists in the Engineering Industry, and the assistants to all the foregoing tradesmen; Carpenters, Painters, Bricklayers, Rubble Wallers, Plasterers, Stone Masons, Plumbers and Sheet Metal Workers, Moulders, Coremakers, Masters, Mates, Marine Engineers, Clerks, Watchmen, Cleaners, Electrical Workers (except such as are covered by paragraph "15" hereof), Builders' Labourers employed to assist building tradesmen on the construction of buildings.

[31] Rule 6B appeared to exclude Marine Engineers in the State of Western Australia from AWU coverage. However, the point was not laboured by either party. For the purpose of this decision, it was unnecessary to draw a conclusion on the matter. As it was, the AWU submitted to the effect that this extension of eligibility and the associated carve outs within it, were historic remnants of an amalgam of rules, and were of no effect.

[32] The AWU advanced that the group to be balloted was the group that had been referred to in the bargaining meetings and mirrored the classifications in the training matrix that had been admitted into evidence. Mr Heath gave evidence that the Company and the AWU had agreed that the proposed agreement will apply to employees within the following classifications: Operator Technician - Production; Operator Technician - Marine; Maintenance Technician (Mechanical), (Marine) and (E&I), and General Service Operator.

[33] The Company contended that there were 49 employees in operational, maintenance, engineering and general service roles on the FPSO, whose employment would be regulated by an enterprise agreement. The Company purported that there were two Marine Engineers, and yet Mr Young, the representative for the AWU, appeared adamant that there were no Marine Engineers referred to in the classifications for the proposed agreement.

[34] Mr Heath gave evidence that the application for a protected ballot order was just that, and it was not an argument about the Rules of the AWU.

[35] Section 437(3)(a) says that the application must specify the group or groups of employees to be balloted. As noted, in response to the Company's submission that the group had not been specified, the AWU sought leave to amend its application and Draft Order. The parties, having been provided with the decision of the Deputy President in Construction, Forestry, Mining and Energy Union v AGL Loy Yang Pty Ltd T/A AGL Loy Yang[18] agreed that that the Commission had authority to entertain such amendment under s 586 of the Act, or alternatively was not confined to making a decision in the terms sought.[19]

[36] The application set out that the group or groups of employees to be balloted were:

In accordance with s 437(5) of the Act, the employees to be balloted are those employees of Jadestone Energy (Australia) Pty Ltd who will be covered by the proposed enterprise agreement and are represented by The Australian Workers' Union.

[37] The Company and the AWU submitted that the group of employees who would be covered by a proposed agreement and were to be balloted, were those employees in operational, maintenance, engineering and service roles. As observed, s 437(5) provides that the group of employees is taken to include only employees who will be covered by the proposed agreement and are represented by a bargaining representative who is an applicant for the protected action ballot order.

[38] Based on the evidence and having considered the Rule 5 of the Rules of the AWU (see paragraph 28 of this decision), I am satisfied that the AWU is a bargaining representative for the group of employees and I am content to permit the Draft Order (and the application) to be amended pursuant to s 586 of the Act, such that it reads:

In accordance with s 437(5) of the Act, the employees to be balloted are those employees of Jadestone Energy (Australia) Pty Ltd who will be covered by the proposed enterprise agreement in operational, maintenance, engineering and service roles and who are represented by their bargaining representative, The Australian Workers' Union.

[39] However, having concluded thus, I note again that the representative for the AWU stated that that there were no Marine Engineer positions named in the classifications to be included in the proposed Agreement. This is notwithstanding the evidence of Mr Heath, who seemed to assert at one stage that the AWU may have been seeking to cover Marine Engineers. In its written submissions, the AWU clarified, in response to the Company's objection that that the group of employees had not been specified, that it would seek to vary its application (as referred to above) and would not seek to cover Deck Officers or those in leadership roles. While the written submission did not refer to excluding Marine Engineers, it remains that I am unpersuaded that the AWU is pursuing the application for an improper purpose or engaging in a misuse of the process.

[40] The only employees that can be balloted are those for whom the AWU is the bargaining representative. Given the participation of the AMOU and the AIMPE in the negotiations to date, and observing that there was no contention advanced that such unions were not involved, I am satisfied the intention of the AWU has been and remains that the group of employees to be balloted are the Company's employees who will be covered by the proposed agreement, who are AWU members, and for whom the AWU is a bargaining representative. The Draft Order reflects this with the amendment made further assuaging the concern raised that the AWU has not identified the group of employees as required by s 437(3)(a). I am therefore satisfied that the application has specified the group of employees who are to be balloted (see s 437(3)(a)).

[41] It should be noted that the group to be balloted does not include those employees who are represented in the bargaining process by the AIMPE or the AMOU as their bargaining representatives. By way of observation only, neither party to the application sought to provide a list of the employees who would be covered by the proposed agreement, and a list of those who were AWU members, to the AEC.

[42] The AWU sought a further amendment of its application, noting that the number of employees to be balloted was not 41, but rather 47. In support of this application, under s 586, the AWU explained that when initially checking the numbers for the purpose of making the application, the membership records for the Montara Venture were checked. However, at a later point, the AWU checked the membership records under the name of the former employer and located further named members employed aboard the FPSO. These submissions were provided by the representative of the AWU from the bar table. While it is the case that there is no preclusion from taking evidence from the bar table, there was simply insufficient probative evidence before me to permit the amendment sought. Therefore, discretion has not been exercised to permit the amendment.

[43] Section 443(1)(b) requires that, before a protected action ballot order can be issued, the Commission must be satisfied that the applicant union has been, and is, genuinely trying to reach agreement with the employer of the employees who are to be balloted.

[44] It follows that there are two temporal components to s 443(1)(b): the applicant must have been genuinely trying to reach agreement and must be genuinely trying to reach agreement.[20] I am satisfied that the AWU has been, and is, genuinely trying to reach an agreement with the Company. There was nothing advanced to impugn the bona fides of the AWU's claim in this respect.

[45] The AWU submitted that there were several key terms and conditions that were not currently agreed between the AWU and the Company. These included wages and wage increases, job security and labour hire provisions, redundancy provisions, minimum manning provisions, classification structure and hours of work.

[46] The Company submitted that the application was premature. It advanced that it continued to bargain in good faith, and the AWU had failed to take into account the changed environment occasioned by the Covid-19 pandemic and the changed economic conditions. Mr Hobbs expressed the view that the AWU had declined to acknowledge and discuss the impact of low world oil prices on the Company, and its needs to moderate labour related costs to maintain the viability of the Company.

[47] A Full Bench in Total Marine Services Pty Ltd v Maritime Union of Australia[21] refrained from adopting a formulaic approach when applying the statutory test under s 443(1)(b) stating:

[31] In our view the concept of genuinely trying to reach an agreement involves a finding of fact applied by reference to the circumstances of the particular negotiations.[22] It is not useful to formulate any alternative test or criteria for applying the statutory test because it is the words of s. 443 which must be applied. In the course of examining all of the circumstances it may be relevant to consider related matters but ultimately the test in s. 443 must be applied.

[32] We agree that it is not appropriate or possible to establish rigid rules for the required point of negotiations that must be reached. All the relevant circumstances must be assessed to establish whether the applicant has met the test or not. This will frequently involve considering the extent of progress in negotiations and the steps taken in order to try and reach an agreement. ....

[48] It is not necessary to show that negotiations on the agreement or an item of the agreement have been exhausted, and it is not necessary to show that the making of an application for a protected action ballot order is a last resort.[23]

[49] It is clear on the evidence that the negotiations have been ongoing for only a short period, given the hiatus between March and June 2020.

[50] However, there have been several enterprise bargaining meetings at which the terms of the proposed draft agreement appear to have been discussed. There was no argument to the contrary. In light of the evidence, I am satisfied there is a 'proposed enterprise agreement' within the meaning of ss 437(1) and 443(1) of the Act.[24]

[51] The evidence suggests that the parties remain at a distance on key conditions that are to be included in the proposed agreement. However, the fact that the current positions of the parties is known supports a conclusion that genuine bargaining for an agreement is and has been taking place. There is no evidence to the contrary. In all the circumstances, I am not convinced that the application has been prematurely made, given the history of negotiations to date.

[52] The lack of acknowledgement of changed economic considerations does not in the circumstances of this case indicate a departure from genuinely trying to reach agreement. No evidence indicated that there had yet to be a full exchange of views on critical matters - a refusal to acknowledge changed economic considerations does not negate this point.

[53] As I have observed, there is no persuasive evidence that the AWU is pursuing some ulterior or extraneous purpose. I also note that there is no suggestion that the bargaining that has occurred to date has been superficial or perfunctory.

[54] In approaching an assessment as to whether the AWU is 'genuinely trying,' it must also be borne in mind that the expression is concerned with the genuineness of efforts by the bargaining representative to achieve the goal of an enterprise agreement that meets the approval requirements of the Act. I do not perceive there to be evidence before me that indicates that the AWU lacks motivation or intention to reach an agreement with the Company.

Whether proposed ballot questions sufficiently clear

[55] With regard to the proposed ballot questions, it is clear that what is required is that the questions should describe the industrial action in such a way that employees are capable of responding to them.[25] To be able to respond, the application should propose a question and contain other details about the industrial action and other relevant matters, that will permit employees to make an informed choice on whether to authorise the particular action specified in the question.[26] A question which is ambiguous or does not permit such a result does not comply with the requirements for a valid application.

[56] The Company has submitted that question 3 of the ballot question is vague and needs to be more precise. In this respect, I note that question 3 and question 4 read:

A ban on undertaking any work involving the preparation and discharge of offtake vessels?

A ban on the loading, unloading or discharge of cargo other than food and other essential consumables?

[57] On any objective level, it is difficult to discern whether the questions refer to a singular ban of indefinite duration, a singular ban for a finite period, or a ban for a finite period followed by another ban for a finite period (that is a series of discrete bans for finite periods). In the context of this application, the questions are ambiguous and do not place the employees in a position to make an informed choice about the type of protected industrial action they are voting to take. On this basis, I have removed questions 3 and 4 from the Draft Order.[27]

[58] The Commission can require a longer period of notice to be given, if satisfied there are exceptional circumstances justifying this.[28] The onus sits with the Company to provide evidence that would satisfy the Commission that there are exceptional circumstances in this instance.

[59] The approach to exceptional circumstances, in this context, was discussed by Vice President Lawler in CEPU v Australian Postal Corporation,[29] which concerned an equivalent provision of the Workplace Relations Act 1996[30]:

[10] In this passage his Honour was concerned with the ordinary meaning of the expression "exceptional circumstances" and the approach identified is, in my view, equally applicable to the use of that expression in s.465(3). In summary, the expression "exceptional circumstances" requires consideration of all the circumstances. To be exceptional, circumstances must be out of the ordinary course, or unusual, or special, or uncommon but need not be unique, or unprecedented, or very rare. Circumstances will not be exceptional if they are regularly, or routinely, or normally encountered. Exceptional circumstances can include a single exceptional matter, a combination of exceptional factors or a combination of ordinary factors which, although individually of no particular significance, when taken together are seen as exceptional. It is not correct to construe "exceptional circumstances" as being only some unexpected occurrence, although frequently it will be. Nor is it correct to construe the plural "circumstances" as if it were only a singular occurrence, even though it can be a one off situation. The ordinary and natural meaning of "exceptional circumstances" includes a combination of factors which, when viewed together, may reasonably be seen as producing a situation which is out of the ordinary course, unusual, special or uncommon.

[11] However, it is important to note that when considering whether to make an order pursuant to s.463(5) the Commission is not simply concerned with determining whether there are exceptional circumstances. There must be exceptional circumstances "justifying" the specification of a longer notice period. The notion of justification is critical and calls for a consideration of the purpose of the notice required by s.441.

[60] The Vice President went on to state:

[21] Essentially, what is required in determining whether exceptional circumstances justify an extension of the required notices [sic] period is a weighing of the interests of the employer and third parties in the employer having a greater opportunity to take appropriate defensive action as against the diminution in the effectiveness of the employees' bargaining power that results from such an extension. The fact that the legislature has seen fit to condition the ordering of an extension of the required notice period on the presence of exceptional circumstances justifying it, as distinct from merely conferring a simple discretion to extend the required notice period, indicates that ordinarily there should be no extension.

[22] The first example provided in Davids Distribution provides an illustration of where exceptional circumstances may justify an extension of the required notice period. A sophisticated piece of plant, such as a smelter, may take many days to shut down without damage. The employer is exposed to wholly disproportionate damage if it is prevented by too limited a notice period from undertaking an orderly shutdown of the plant. A further example may be afforded by a strike by teachers where the school needs to be able to notify parents of the strike so as to give them an opportunity to make alternative arrangements for the care of their children on the days of the strike. Typically, three working days will be insufficient for this purpose.

[61] To summarise, in order to warrant an extended period of notice, the Commission must be satisfied both as to the existence of exceptional circumstances and the fact that these justify the granting of the extended notice. This requires a weighing up of the opportunity for the Company to take appropriate defensive action against the diminution of the effectiveness of the AWU members' bargaining power that is contemplated by the scheme of the Act.[31] In that light, it would not be a relevant exercise of discretion to grant additional notice simply to allow the employer to neutralise the impact of the industrial action.[32]

[62] The Company submitted that if the Commission was moved to grant the protected action ballot order, then the order should be varied to extend the written period of notice of industrial action, as referred to in s 414(2)(b) of the Act. The Company submitted that the Commission should take into account the very remote location of the FPSO, its distance from the mainland and the limited logistics / personnel transfer facilities.

[63] In cross examination and in its submissions, the AWU sought to minimise the time taken to travel to and from the FPSO. However, there was no evidence advanced that contradicted the Company's position concerning the difficulties faced in securing ongoing transport by helicopter to the facility (secured on a month by month basis). Further, it is an indubitable fact that the Company is required to quarantine its employees for two weeks in Darwin prior to mobilising them to the FPSO because of the border restrictions in Western Australia - borne from the Covid-19 pandemic. While evidence was provided that some employees, who are Western Australian based, are not subject to the quarantine requirements and fly to Broome and thereafter Truscott Airbase, I do not consider that this detracts from the exceptional circumstances the Company finds itself in.

[64] It is accepted that to be exceptional, circumstances must be out of the ordinary course, or unusual, or special, or uncommon but need not be unique, or unprecedented, or very rare. The circumstances, at present, are not only out of the ordinary course, unusual or special, but by any account are unprecedented. The imposition of quarantine requirements, and the implications arising from the same, justify an extension to the period of written notice referred to in s 414(2)(a).

[65] While several decisions were brought to this Commission's attention, where the notice period had been extended due to the remoteness of operations, the decision arrived at sits squarely upon the facts as presented. The exceptional circumstances in this matter justified the period of notice of protected industrial action being longer than three working days, as is prescribed in the Act. The Order issued reflected that such notice would be seven working days.

[66] The Company advanced several other objections. These include, the consequences of holding a full tanker of oil for indefinite periods, the disproportionate nature of the proposed industrial action in light of the economic viability of the Company (reliant on offtake and associated cash flow) and the prolonged consequences of a shut on the oil field.

[67] Whilst I am not unsympathetic to such contentions, safety concerns about the nature and impact of any proposed industrial action are not a relevant consideration under s 443 when the Commission is determining whether a protected action ballot order must be made. However, the AWU sought to further amend the Draft Order to cater for 'safety' exemptions that it said would usually be made in the circumstances of floating production, storage and offtake facilities. If the protected action ballot order was granted, the Company seemed to have no objection to the adoption of the amendment. Therefore, the amendment has been made in accordance with the proposed terms.

[68] Regarding the remaining objections, they do not constitute a statutory barrier to a protection action ballot order being issued under s 443 of the Act.

C Young, Legal and Industrial Officer, of the Australian Workers' Union.

P Cooke, of the Australian Mines and Metals Association, for the Respondent.

[1] PR722512.

[2] Witness statement of Owen Hobbs [3].

[9] Witness Statement of Douglas Heath, Exhibit DH-1.

[10] Witness statement of Owen Hobbs [19].

[12] Witness Statement of Douglas Heath [10].

[14] Applicant's Form F34 - Application for a protected action ballot order [question 2].

[15] Australian Human Resources Institute Pty Ltd v National Tertiary Education Industry Union, PR941696, per Williams SDP, Lacy SDP and Foggo C, 10 November 2003, [10].

[16] Transport Workers' Union of Australia v Qantas Airways Limited (1985) 11 IR 145, 147.

[17] Construction, Forestry, Mining and Energy Union v Dyno Nobel Asia Pacific Limited [2005] AIRC 622.

[18] [2016] FWC 4364.

[20] Esso Australia Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [2015] FWCFB 210, [54].

[21] [2009] FWAFB 368.

[22] Australian Industry Group v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union Print T1982_; Re Media, Entertainment and Arts Alliance_ PR928033.

[23] CEPU and AMWU v Kraft Foods Ltd (2010) 197 IR 12.

[24] Mermaid Marine Vessel Operations Pty Ltd v The Maritime Union of Australia [2014] FWCFB 1317; Skilled Offshore Pty Ltd v AMWU and others [2015] FWCFB 7399, [27]; Maritime Union of Australia v Maersk Crewing Australia Pty Ltd [2016] FWCFB 1894, [15].

[25] John Holland Pty Ltd v Automotive, Food, Metals Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers' Union (AMWU) [2010] FWAFB 526, [19].

[26] National Union of Workers - New South Wales Branch v FreshExchange Pty Ltd [2009] FWA 221, [10].

[27] Fair Work Act 2009 (Cth) s 599.

[29] Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Australian Postal Corporation [2007] AIRC 848.

[30] Workplace Relations Act 1996 (Cth), s 463(5).

[31] Australian Federation of Air Pilots v Alliance Airlines Pty Ltd T/A Alliance Airlines [2017] FWC 6748, [12].

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