Bluescope Steel (AIS) Pty Ltd v Australian Workers' Union, New South Wales

LEGISLATION CITED: Industrial Relations Act 1996

Bluescope Steel (AIS) Pty Ltd v Australian Workers' Union, New South Wales and Anor (2005) 138 IR 324 CASES CITED: Bluescope Steel Limited (Formerly BHP Steel Limited) v The Australian Workers' Union, New South Wales (2004) 137 IR 176 Construction, Forestry, Mining and Energy Union ( New South Wales Branch) v Newcrest Mining Limited (2005) 139 IR 50

PROSECUTOR Mr K G Bennett of counsel with Ms J Sutherland Solicitor: Mr D Lloyd BlakeDawsonWaldron LEGAL REPRESENTATIVES:

RESPONDENT Mr A Hatcher of counsel Solicitor: Mr J Howard Maurice May Lawyers

JUDGMENT: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION

BLUESCOPE STEEL (AIS) PTY LTD v THE AUSTRALIAN WORKERS' UNION, NEW SOUTH WALES

Application by Bluescope Steel (AIS) Pty Ltd for summons to show cause under section 139 of the Industrial Relations Act 1996

1 This matter concern a summons issued by the Commission in Court Session on the application of Bluescope Steel (AIS) Pty Ltd ("the prosecutor") on the Australian Workers' Union, New South Wales ("the AWU") to show cause why the Court should not take action against the AWU in respect of alleged contraventions of dispute orders made by Commissioner Connor on 23 April 2004 under s 137 and s 138 of the Industrial Relations Act 1996 in matter No IRC 2434 of 2004. The contraventions were alleged to have occurred on 27, 28, 29 and 30 April 2004. 2 The alleged contraventions relate to alleged industrial action taken by the AWU, its respective officers and employees and members of the AWU employed at the coke oven batteries of the Port Kembla Steelworks of the prosecutor in support of claims for improved wages and working conditions. This was not a straightforward case, however, where the prosecutor sought dispute orders in relation to anticipated industrial action over an industrial matter, where orders were made proscribing such industrial action and where the orders were contravened: cf Bluescope Steel v Australian Workers' Union, New South Wales and Anor (2005) 138 IR 324. 3 The summons has its origins in a dispute that occurred on 22 April 2004. On that day the prosecutor caused the dispute to be notified to the Industrial Registrar pursuant to s 130 of the Act involving the AWU and its members employed in the Coke Making Department of the prosecutor. The dispute notification stated: The dispute concerns strike action by production employees employed by the Company at the Coke Ovens of Port Kembla Steelworks. The employees are members of The Australian Workers' Union, New South Wales (AWU). The strike commenced at 8.00am today. The Company understands the strike is in protest following the dismissal of an employee. The Company also understands the employees and the AWU are next due to meet to consider their position in relation to the continuation of the strike at approximately 6.00pm tonight.

The persons involved in or affected by this dispute are the Company and the AWU.

The strike, if it continues, will result in serious adverse operational consequences for the Company given the Coke Ovens Batteries must be operated on a continuous basis.

The prosecutor sought an urgent compulsory conference. 4 The dispute was allocated Matter No IRC 2434 of 2004 and came before Connor C in compulsory conference at approximately 2.00pm on 22 April in Wollongong. Connor C recommended that there be a return to work and the normal processes, namely, an application under Pt 6 of Ch 2 of the Act be followed. The Commissioner listed the matter for report back the following day, 23 April at 10.30 am. 5 A meeting of striking employees was held the next morning at about 6.00 am but the strike action continued. The prosecutor advised Connor C that when the matter came before him later that morning it intended seeking a certificate of attempted conciliation pursuant to s 135(2) and dispute orders under ss 137 and 138 of the Act. 6 Subsequently, on 23 April after hearing the parties, the Commissioner issued a certificate of attempted conciliation and made dispute orders. In his decision Connor C noted that the strike by employees in the coke oven batteries had been taken "in protest at the dismissal of Mr Methuisela Malufuka, an operator, for allegedly threatening behaviour towards a supervisor." The Commissioner stated: This particular strike is particularly inappropriate and unnecessary since the AWU has already brought its concerns over Mr Malufuka's dismissal to the attention of the Commission in the proper manner, ie through its Part 6 application. The strike can do nothing to assist in resolving the matter. It does nothing but place an unnecessary burden in the way of the effective resolution of the issue in dispute. 7 The Commissioner's certificate of attempted conciliation simply stated, "I certify that I have attempted conciliation in relation to the question, dispute of difficulty in this matter." The dispute orders were in the following terms: ORDER 1. The AWU, their respective officers and employees and their respective members employed at the coke oven batteries of the Port Kembla steelworks of Bluescope Steel must immediately cease and refrain from taking any form of industrial action, including any strike, stop work meeting, ban, limitation or restriction on the performance of work; 2. The AWU their respective officers and employees must immediately cease and refrain from organising, encouraging or inciting any industrial action (including any strike, stop work meeting, ban, limitation or restriction on the performance of work) contrary to the order in para 1 above. 3. The AWU and their respective officers and employees must take all reasonable and necessary steps to ensure that order in para. 1 is complied with. 4. This order shall come into effect on and from on (sic) 6.00pm on Friday, 23 April 2004 and shall remain in force until Monday 24 May 2004 unless, on formal application, it is varied or rescinded in the meantime. 8 In the result, the striking employees employed at the coke oven batteries returned to work at about 6.30 pm on 23 April 2004. 9 On 27 April 2004 a notice convening a stop work meeting of all members of the "combined steel unions" was circulated within the steelworks calling a stop work meeting at 7.30 am on 29 April 2004. The agenda of the meeting was: To hear an up-to-date report on the EBA negotiations

Outsourcing on Coil Handling - Brambles 10 The meeting took place and immediately following it a number of employees returned to the steel works and established picket lines at various entrances. The remaining employees, including those employed in the coke oven batteries, commenced strike action. 11 On 29 April the prosecutor, through its solicitors, notified the existence of an industrial dispute. The notification was in the following terms: IRC No 400 of 2004 - Bluescope Steel (AIS) Pty Ltd and Anor and the AWU and others re Enterprise Agreement We refer to the above matter which has been the subject of conciliation before Deputy President Grayson, and is now to be heard before a Full Bench of the Commission including for directions on Monday, 3 May 2004. We are now instructed by Bluescope Steel that this morning there has been a stop work meeting of all employees of Bluescope Steel (AIS) Pty Ltd and Bluescope Steel limited in Port Kembla, members of the Australian Workers' Union, New South Wales, Electrical Trades Union of Australia, New South Wales Branch and the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union, New South Wales Branch. We are further instructed that arising from that meeting the employees will take indefinite strike action. The main subject matter of the stop work meeting this morning was identified as enterprise bargaining issues (ie the subject matter of IRC No 400 of 2004).

The notifier sought an urgent hearing. 12 The dispute in Matter No IRC 400 of 2004 came before a Full Bench of the Commission on 29 April listed together with Matter Nos IRC 2167 and 2543 of 2004, which were associated matters. Matter No IRC 2434 of 2004, the dispute dealt with by Connor C in relation to the Malufuka dismissal, was not listed before the Full Bench and no mention was made of it in the proceedings before the Full Bench. The focus of the parties and the Full Bench was on the outstanding issues between the parties in the enterprise bargaining negotiations. 13 Arising out of the Full Bench proceedings, and on the recommendations of that Full Bench, the pickets were removed later that evening. Following a mass meeting of employees at about 7.30 am on 30 April 2004 there was a general return to work by all employees, including the employees in the coke oven batteries. 14 A decision was taken subsequently by the prosecutor to apply for the summons that is the subject of these proceedings. The prosecutor has taken the view that the dispute orders made by Connor C and which were current over the whole of the period from 23 April 2004 to 24 May 2004, were contravened by the AWU, its officers and employees and members employed in the coke oven batteries by virtue of their participation in the industrial action relating to enterprise bargaining claims and that such contraventions occurred on 27, 28, 29 and 30 April 2004. 15 Mr A Hatcher of counsel for the AWU raised a jurisdictional issue at the outset and that was essentially that the dispute orders did not apply to the industrial action on 27, 28, 29 and 30 April 2004 in connection with the enterprise bargaining claims. Consequently, it was contended, the Court had no power to make any findings relating to contravention under s 139 of the Act. 16 Notwithstanding Mr Hatcher's threshold objection it was accepted that the Court should hear the whole of the evidence and submissions of the parties on the substantive issue arising out of the summons and the jurisdictional issue before deciding the jurisdictional issue and that was the approach adopted by the Court. Consideration as to jurisdiction

17 I find it unnecessary to make any determination as to whether there were contraventions of the dispute orders on the days claimed because I am satisfied the orders did not apply to the conduct alleged to be in contravention of the orders. My reasons for adopting that view follow. 18 Part 1 of Chapter 3 of the Act is concerned with the conciliation and arbitration of industrial disputes. Section 130 provides a mechanism for a party to notify the Commission of "an industrial dispute for the purpose of resolving the dispute". An industrial dispute is defined in the Dictionary to the Act as meaning: a dispute (including a question or difficulty) about an industrial matter, and includes the following: (a) a demarcation dispute, (b) a threatened or likely industrial dispute, (c) a situation that is likely to give rise to an industrial dispute if preventative action is not taken. 19 Industrial matters is defined in s 6 of the Act: (1) General definition

In this Act, industrial matters means matters or things affecting or relating to work done or to be done in any industry, or the privileges, rights, duties or obligations of employers or employees in any industry. (2) Examples

Examples of industrial matters are as follows: (a) the employment of persons in any industry (including the employment of minors, trainees, apprentices and other classes of employees), (b) the remuneration (including rates of pay, rates for piece-work and allowances) for employees in any industry, (c) the conditions of employment in any industry (including hours of employment, qualifications of employees, manner of work and quantity of work to be done), (d) part-time or casual employment (including part-time work agreements), (e) the termination of employment of (or the refusal to employ) any person or class of persons in any industry, (f) discrimination in employment in any industry (including in remuneration or other conditions of employment) on a ground to which the Anti-Discrimination Act 1977 applies, (g) procedures for the resolution of industrial disputes, (h) the established customs in any industry, (i) the authorised remittance by employers of membership fees of industrial organisations of employees, (j) the surveillance of employees in the workplace. 20 It is readily apparent that on 22 April 2004 the prosecutor caused an industrial dispute to be notified to the Commission pursuant to s 130. The subject matter of the dispute, which had manifested itself in a strike by employees in the coke oven batteries, was the termination of employment of Mr Malufuka, an employee of the prosecutor; a classic industrial dispute. The ambit of the dispute was also apparent; it concerned Mr Malufuka's dismissal, either in protest at the dismissal and/or in support of his reinstatement and, I see from the transcript of proceedings before Connor C on 23 April, a protest at the attitude or conduct of certain supervisors. That was the scope of the industrial dispute in Matter No IRC 400 of 2004. 21 In accordance with s 133 of the Act Connor C attempted to resolve the dispute by conciliation. The Commissioner was unsuccessful and he was convinced to issue a certificate of attempted conciliation under s 135(2) of the Act. Section 135(2) provides: Arbitration by the Commission is not to proceed until the Commission has issued a certificate that reasonable attempts have been made to resolve the [ my emphasis ] industrial dispute by conciliation ( certificate of attempted conciliation ). 22 Section 135(7) provides: The Commission must, without delay, issue a certificate of attempted conciliation if the Commission decides that industrial action or duress necessitates the exercise of its arbitral powers.

The industrial action referred to in s 135(7) must as a matter of logic and common sense be in connection with the industrial dispute being dealt by the Commission and which is referred to in s 135(2). 23 The industrial dispute that Connor C was attempting to deal with and in respect of which he issued a certificate, was the industrial dispute relating to the dismissal of Mr Malufuka. The certificate cleared the way for the Commission to exercise its arbitral powers. Section 136 provides that in any arbitration the Commission may do a number of things including making a dispute order under Pt 2 of Ch 3. Section 136(2) provides that any action in arbitration proceedings, such as making a dispute order, "may be taken by the Commission on its own initiative or on any application by any person authorised to notify the Commission of the industrial dispute." 24 The kinds of dispute orders the Commission may make are specified in s 137 of the Act and include an order that a person cease and refrain from taking industrial action: s 137(1)(a). This was the kind of order made by Connor C on 23 April 2004. Other elements of the orders made by the Commissioner were within power by virtue of the Full Bench decision in Bluescope Steel Limited (Formerly BHP Steel Limited) v The Australian Workers' Union, New South Wales (2004) 137 IR 176. 25 Section 137 provides that: 137 Kinds of dispute orders (1) The Commission may make the following kinds of dispute orders when dealing with an industrial dispute in arbitration proceedings: (a) The Commission may order a person to cease or refrain from taking industrial action.

(b) The Commission may order an employer to reinstate or re-employ any one or more employees who were dismissed in the course of the industrial dispute or whose dismissal resulted in the industrial dispute.

(c) The Commission may order an employer not to dismiss employees in the course of the industrial dispute if the employer has threatened to do so.

(d) The Commission may order a person to cease a secondary boycott imposed in connection with the industrial dispute. (2) If employees are taking industrial action in connection with the industrial dispute, the Commission may order the employees to cease taking that industrial action before it makes any other kind of dispute order against the employer. (3) A dispute order may not provide for the payment of compensation, lost remuneration or any other amount. 26 The prosecutor appeared to submit that the use of the word "an" before the words "industrial dispute" in s 137(1) meant that the Commission could make dispute orders in relation to any dispute, not just the dispute before it. 27 The prosecutor submitted: The use of the indefinite article "an" before the words "industrial dispute" in the opening words requires that the term industrial dispute operates in a general sense. The powers enumerated in s.137 (1) (a), (b), (c), and (d) apply according to their terms. Paragraph (a) is a grant of discretionary power enabling the Commission to order a person to cease and refrain from taking industrial action. Whereas the definite article "the" used in paragraphs (b), (c), and (d) of s.137(1) empowers the Commission to make particular orders in the context of the industrial dispute. Accordingly in respect of the power under consideration - s.137(1)(a) the Commission has a specific power to order a person to cease or refrain from taking industrial action in relation to "an" industrial dispute not "the" industrial dispute. Paragraph (a) unlike (b), (c) and (d) is not restricted in relation to the industrial dispute. It is a wide power enabling the Commission to craft orders ending industrial action and/or preventing it from occurring in the future. The power is a specific power to order a person to cease or refrain from taking industrial action and the words used in s.137(1)(a) ought be construed in accordance with their ordinary grammatical meaning. The power contained in s.137(1) (a) can be contrasted with the more limited power in s.137(2). The power to make orders pursuant to s.137(2) is limited to "industrial action in connection with the (our underlining) industrial dispute". Further, the order can only operate as a "cease" order. As discussed earlier, these limitations do not operate in the context of a dispute order pursuant to s.137(1)(a). This interpretation is consistent with the approach of the Commission under this Act and the preceding industrial acts; being that arbitration of disputes is to occur in an orderly fashion unaffected by industrial action, either actual or threatened. 28 Pursuant to s 137(1) the Commission may make certain kinds of dispute orders when "dealing with an industrial dispute". That is, the dispute that was notified to the Commission pursuant to s 130 and which was dealt with first by conciliation in accordance with s 133 and then, conciliation having failed, became the subject of arbitration proceedings. If the Commission had not been "dealing" with an industrial dispute either generally by arbitration or by virtue of s 135(7), it cannot make a dispute order. Connor C had not dealt with, and was not dealing with, the dispute that erupted over enterprise bargaining. He could not, therefore, make a dispute order in respect of that dispute. 29 To accept the prosecutor's interpretation would, as counsel for the AWU submitted, undermine the whole purpose and intent of Pt 1 of Ch 3, which emphasises that the primary method of resolution of industrial disputes is to be by conciliation: Construction, Forestry, Mining and Energy Union (New South Wales Branch) v Newcrest Mining Limited (2005) 139 IR 50 at [16]. Arbitration is a last resort. Under the prosecutor's approach an industrial dispute may be the subject of dispute orders before it is the subject of conciliation and, indeed, even before the dispute came into existence. Such an approach is contrary to s 133.

30 The prosecutor contended that its approach to the interpretation of s 137(1)(a) finds support in Bluescope Steel v Australian Workers' Union, New South Wales (2004) 137 IR 176 at [91] where the Full Bench stated: The AWU urged us to construe the dispute orders made by Commissioner Connor by reference to the nature of the proceedings in which the application for those orders were made. Such an approach is wrong (prosecutor's underlining), particularly in circumstances where the orders are clear on their face; the reference to industrial action, in the context of the dispute orders under s.137, was consistent with the meaning given to that expression by the Act; and the orders did not indicate a contrary meaning, either expressly or implicitly.

31 The submission there rejected by the Full Bench was directed to whether the Commissioner's order required the urgent despatch of product occur. There was no issue in that case that the orders made by the Commissioner directly related to the industrial dispute before the Commissioner. 32 Section 138 of the Act provides: 138 Making of dispute orders (1) A dispute order may be made only against: (a) a party or likely party to the industrial dispute, or (b) a member, officer or employee of an industrial organisation that is such a party or likely party, or (c) a person engaged, or likely to be engaged, in a secondary boycott in connection with the industrial dispute. (2) A dispute order: (a) must clearly identify the persons against whom the order is made and who are bound by the order, and (b) must state a time within which the order is to be complied with or state a period during which it remains in force, and (c) may be varied or revoked by the Commission at any time. (3) If an employee is reinstated or re-employed under this Part, the Commission may order that the period of employment of the employee with the employer is taken not to have been broken by the dismissal ( my emphasis ). 33 It is apparent from the terms of s 138 that the legislature was concerned at the need for precision in the making of dispute orders including that they should relate only to the industrial dispute in respect of which they were made. The industrial dispute referred to in s 138(1) must be taken to be a reference to the dispute the Commission is dealing with in arbitration proceedings: s 137(1). 34 The industrial dispute in respect of which Connor C made dispute orders was the dispute relating to the dismissal of Mr Malufuka. In making the orders the Commissioner gave consideration to no other subject matter than the conduct of the AWU, its officers and employees, and its members in the coke oven batteries, in respect of the dismissal of Mr Malufuka; the dispute orders were issued based only on those considerations.

35 If the prosecutor's position were correct, that is to say the dispute orders made on 23 April had a blanket application to any conduct proscribed in those orders for the period the orders were to apply, regardless of the subject matter of the dispute in respect of which the orders were made, it would, in my opinion, amount to a denial of natural justice. 36 It is a matter within the Commission's discretion but a member of the Commission must have a proper basis for making a dispute order; the consequences for those organisations and persons in respect of whom such an order is made may be quite serious if the dispute order is contravened. The respondent, in any application for a dispute order, is entitled to put its case and it may be, in the exercise of the Commission's discretion after hearing the parties, no such order is made because the Commission considers an order is not warranted. In the present case there was no foreshadowing of any industrial action in support of enterprise bargaining on 27-30 April 2004; the AWU had no opportunity to state its case in the face of an application for dispute orders in that respect and it was not in the contemplation of Connor C when he made the dispute orders. 37 It cannot be the case that in framing Parts 1 and 2 of Ch 3 of the Act the legislature intended a dispute order to apply to any dispute, regardless of the reasons underpinning its making. 38 In addition to considerations going to denial of natural justice there is the contention of Mr Hatcher of counsel that, if once made, a dispute order of the nature issued by Connor C was to be taken as proscribing the conduct to which it refers, regardless of whether the conduct had any connection to the industrial dispute in respect of which the order was made, an unprincipled employer might seek to take advantage of the situation. For instance, such an employer might be tempted to provoke the conduct proscribed by the dispute order by fomenting another dispute in order to launch prosecution proceedings against those persons or organisations that were the subject of the order. That was not the case here by any means, but such considerations strengthen the view that any dispute order is only valid in so far as it relates to the industrial dispute that gave rise to its making. 39 Part 3 of Ch 3 of the Act deals with common law actions during conciliation of industrial disputes. Section 141 provides that actions in tort while the Commission is attempting to conciliate an industrial dispute are not actionable (with some named exceptions). Section 141(2) provides, for instance, that an industrial dispute is subject to conciliation if a certificate of attempted conciliation has not been issued by the Commission.

40 The effect of Pt 3 is to provide immunity from prosecution for certain types of tort action where industrial action is taking place during conciliation. On the prosecutor's approach, however, that immunity is undermined because dispute orders may be made proscribing the industrial action and thereby leaving s 141 without any work to do.

41 The prosecutor referred to a series of cases where dispute orders had been made by the Commission in which orders had been made to cease and refrain from taking industrial action in a general sense with no specific subject matter limitation. The decisions are of little assistance because in none of them was the Commission required to give consideration to the jurisdictional issue raised in these proceedings.

42 The prosecutor submitted that the AWU's contention that the Commission's discretion to make orders requiring that industrial action cease or refrain only in circumstances in respect of the subject matter of the industrial dispute, would require the technical identification of the subject matter of the dispute resulting in unwarranted practical difficulties when seeking to deal with industrial action. It was submitted this outcome would lead to the introduction of legal technicalities where none is warranted by the terms of the section and contrary to the purpose of s 3(g) of the Act - to minimise legal technicality. 43 The issue here is a question of jurisdiction, not procedure. It is, of course, open to a member of the Commission, in making any dispute orders, to identify the subject matter of the dispute in respect of which the orders are made. This would put beyond doubt the conduct in respect of which the orders were concerned. This is hardly a burdensome legal technicality. But this is not mandatory because it should be apparent from the record - which is the case here - what is the subject matter of the dispute and what conduct the dispute order is directed against.

44 The prosecutor submitted: As far as the factual basis of the disputes of 22 and 23 April and 29 and 30 April 2004, it cannot be said that the industrial action related to totally different matters. Both matters were notified as a result of industrial action. Both matters dealt with primary and secondary issues. While the primary matters were distinct, the secondary matters appear to have elements in common … In any case, whether the two strikes were about different matters or not, they constituted industrial action. The industrial action on 29 and 30 April 2004, being in breach of the dispute orders made on 23 April 2004. 45 It is not apparent to me from the evidence in the proceedings that there were common elements in the two disputes. If that were the case it was open to the prosecutor to seek to draw that out or at least put it to the AWU's witnesses in cross-examination. That was not done.

46 The prosecutor submitted that the absurdity of the AWU's was demonstrated by the following proposition: A union pursues industrial action with respect to a matter(s). The matter is notified to the Commission or indeed the Commission calls the dispute before it pursuant to its powers under the Act (sections 130(2) and 132) for the purpose of convening a compulsory conference. On the union's approach the Commission could only make a cease and refrain order with respect to the subject matter that had been identified either in the notification or at the conference. In view of the circumstances of the industrial action the Commission makes a cease and refrain order. It is open to the union to comply with the order relating to subject matter A, return to work for a short period of time and then take further industrial action with respect to subject matter B. This charade could continue indefinitely and would only be limited by the imagination of the union taking the industrial action. The Commission would accordingly be fettered in the manner in which it could control ongoing industrial action having the potential effect of affecting the public interest and secondly prolonging industrial disputation contrary to requirements of s.3(g) of the Act. 47 The "charade" of which the prosecutor speaks would quickly become apparent and it would be a simple matter of amending any dispute order to overcome it. The possibility of these tactics occurring, however, does not lead to the outcome contended for by the prosecutor, namely, any dispute order has blanket application for its term regardless of the basis on which the order was made in the first place.

48 For all of the foregoing reasons I find that the Court has no power in these proceedings to make any findings relating to contravention under s 139 of the Act.

49 The Court orders that the summons in matter No IRC 2434 of 2004 is dismissed. ______________________________________

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