//
[209]
[2020] FWC 4623
General information, not legal advice.
Fair Work Commission
2020-09-09
Original judgment source is linked above.
s.526 - Stand down
Construction, Forestry, Maritime, Mining and Energy Union
Application to deal with a dispute involving stand down.
[1] On 7 November 2019 the Construction, Forestry, Maritime, Mining and Energy Union (MUA) applied to the Fair Work Commission (FWC) to deal with a dispute involving the stand down of employees under s.526 of the Fair Work Act 2009 (FW Act). The employees were stood down by DP World Australia (DPW) during the course of the period 15-16 February 2019.
[2] The MUA and DPW met in conference before the FWC in an attempt to resolve the dispute by conciliation. This was not successful. The MUA asked the FWC to deal with the dispute by arbitration pursuant to s.526(2) of the FW Act. The hearing of the matter was delayed by, among other things, the COVID-19 pandemic and its impact on the ability to conduct an in-person hearing. The matter was heard on 30 June, 1 July and 13 July 2020.
[3] By permission of the Commission the MUA was represented by Mr Philip Boncardo of counsel and DPW by Mr Darren Perry, solicitor, Seyfarth Shaw.
[4] Witness statements were provided and oral evidence was given for the MUA by Mr Michael Walsh, DPW Safety Facilitator; Mr Bradley John Dunn, DPW Safety Facilitator; Mr Clinton John Gaughan, DPW Team Leader and Health and Safety Representative (HSR); Mr Paul Keating, Deputy Branch Secretary of the Sydney Branch of the MUA; Mr Justin Timmins, DPW Team Leader and HSR and Mr Matt Lewis, DPW Team Leader, HSR and Chairman of the Safety Committee.
[5] Witness Statements were provided and oral evidence was given for DPW by Mr Ben Crosky, DPW Stevedoring Manager, and Mr Mark Shallcross Hulme, DPW General Manager Operations.
[6] Extracts of the notebook containing the handwritten notes of SafeWork NSW Assistant State Inspector Mr John Whatman were admitted.[1] Mr John Whatman did not give oral evidence.
[7] On 17 August 2020 I wrote to the parties drawing their attention to a decision of Deputy President Colman on 6 August 2020 in Construction, Forestry, Maritime, Mining and Energy Union v DP World Melbourne Ltd (CFMMEU v DP World Melbourne Ltd).[2] The factual matrix of this decision was, on the face of it, strikingly similar to this dispute. In that matter, employees of DP World Melbourne had refused to work the Xin Da Lian due to concerns about COVID-19. It was held that the employees were not stood down for the purposes of s.524 of the FW Act and the application was dismissed. I sought the parties' submissions with regard to the conclusion and reasoning disclosed in the decision and its relevance to this matter. Submissions were received from the MUA on 24 August 2020, from DPW on 27 August 2020 with a reply from the MUA on 31 August 2020.
[8] In this dispute the MUA contend that employees were wrongfully stood down and as a matter of fairness ask the FWC to restore the employees' wages and to rescind warning letters that assert that employees took unprotected industrial action.
[9] DPW resists this application on the grounds that it was entitled to stand down the employees. They assert that that they were obliged by s.474 of the FW Act not to pay employees for the period of unprotected industrial action. DPW also contend that the relief sought by the MUA is beyond the power of the FWC to grant because it would involve the exercise of judicial rather than arbitral power.
[10] After considering the decision of Deputy President Colman in CFMMEU v DP World Melbourne Ltd, both MUA and DPW submitted, and I agree, that the FWC has the power to deal with the dispute.[3]
[11] DPW conducts stevedoring operations at a terminal located at Port Botany in Sydney known as Port Botany terminal (PBT). Employees at PBT are covered by the DP World Sydney Enterprise Agreement 2015 (Agreement) The majority of stevedoring employees are members of the MUA.
[12] Employees are allocated to perform work on day, evening and night shifts of 8 hours duration. A day shift commences at 6am, an evening shift commences at 2pm and a night shift commences at 10pm.
[13] Allocation for shifts performed on a Friday is required to be advised to employees by 1.45pm on the day before, that is, Thursday. Allocation for shifts performed on a Saturday or Sunday is required to be advised to employees by 1.45pm on the Friday before the weekend.
[14] Employees were stood down during the evening shift of Friday 15 February 2019 (Friday), on the grounds that there was no useful work for the employees to do because work had stopped due to unprotected industrial action.
[15] Employees were stood down during the night shift of Friday and the day and evening shifts of Saturday 16 February 2019 (Saturday) on the grounds that there was no useful work for the employees to do because work had stopped due to four SafeWork NSW Prohibition Notices being issued.
[16] The parties submitted that there was some uncertainty about which employees were stood down and when.[4] Letters sent to employees on 25 February 2019, along with evidence given by Mark Hulme, disclose that:
• 16 employees were sent a letter stating that they were on unpaid stand down for 3.5 hours from 2.30am to 6am on the second run of the night shift that commenced at 10pm on Friday because there was no useful employment for them;[6]
• Approximately 10 employees were stood down for the duration of the night shift that commenced at 10pm on Friday.[7] There is no record of letters being sent to these employees;
• 15 employees were sent a letter stating that they were on unpaid stand down for their full shift on day shift on Saturday because there was no useful employment for them;[8]
• Approximately 16 employees were stood down for 4 hours from either 6am to 10am or 10am to 2pm on the day shift on Saturday;[9] 27 employees were sent a letter stating that they were on unpaid stand down for 3 hours and 45 minutes on the first run of day shift from 6am to 9.45am because there was no useful employment for them.[10] This count may be inclusive of the approximately 16 employees referred to by Mark Hulme in his evidence;[11]
• 33 employees were sent a letter stating that they were on unpaid stand down for their full shift on evening shift on Saturday because there was no useful employment for them.[12]
[17] It is convenient to set out below my conclusions about the events in this case.
[18] On the morning of Friday 15 February 2019 (Friday) the container ship JPO Virgo arrived at Port Botany at the terminal of DPW. This was the first time the JPO Virgo had visited DPW at Port Botany. The ship had last visited the DPW terminal in Brisbane without any issues arising.[13] It was worked with good rates of productivity.[14]
[19] The work of unloading full containers and loading empty containers on the JPO Virgo was on contract to DPW from Hutchison Ports, another stevedore operator in PBT. Hutchison Ports was subject to protected industrial action by its employees in connection with enterprise bargaining that was underway.
[20] The first activity when the ship arrived was that it was inspected by Michael Walsh (Safety Facilitator), Troy Bentley (Operations Supervisor), Scott Shaw (Safety Facilitator) and Scott Atkins (Safety Committee Member). This inspection commenced at 7.20am and concluded at approximately 9.30am on Friday.[15] This was a routine activity undertaken for the purpose of identifying any hazards and Marine Order 32 noncompliance. It was not unusual for ships to present with rust and other defects.[16]
[21] DPW has a policy "Safety, Security and Environment Procedure PBT Vessel Inspection".[17] The policy relevantly states "14. All hazards that expose personnel to risk of injury are to have appropriate controls put in place, prior to commencing work in that area." and "18. No work is to commence on any ship visiting PBT for the first time until a thorough inspection of the entire vessel has been conducted and completed". There are a range of standard controls to deal with defects and the company has established policies and procedures for these.[18]
[22] During the inspection Michael Walsh took handwritten notes and 72 photographs of observations that he regarded as being deficiencies on the JPO Virgo.[19] After the inspection he wrote notes on the 12 Berth Vessel Safety Board.[20] Ben Crosky asked Michael Walsh for his notes and he provided his notes and the photographs to Ben Crosky shortly after 9.47am.[21]
[23] In his handwritten notes Michael Walsh identified safety issues at locations on the JPO Virgo from locations identified as 01 to 55/57. Decks 58 and 62 were yet to be inspected at the end of this inspection at 9.32am. [22]
[24] He gave evidence that he spoke to the Chief Officer of the JPO Virgo and summarised the main points of concern as follows:
"The safety fencing stanchions are not secured; the safety fencing ropes are not tensioned causing the effective height of the fencing to be less than one metre. There is severe corrosion of the safety railings on the elevated work platforms where lashers work. There is corrosion to access hatch covers and hinges."[23]
[25] The safety issues Michael Walsh wrote on the whiteboard were:[24]
Hatch safety fencing non-compliant
Safety ropes not tensioned
Stanchions not secured - no pins, no holes for pins
Severe corrosion to safety railings on elevated platforms
Severe corrosion to access hatch covers
Electrical cables impeding access to points of work
[26] Ben Crosky gave evidence that he commenced his inspection at 10.40am with Troy Bentley. He said that he observed inadequate fall protection in certain areas, one rusted hatchway and lack of tension on wires, and in one place, that a rope had been affixed to a container. He said that he formed the view that these issues could be readily managed through implementing safety controls including use of harnesses, temporary fencing and tightening of the fencing.[25]
[27] Whilst inspecting the ship Scott Atkins contacted Paul Keating by mobile phone.[26] Paul Keating arrived at the DPW administration office at Port Botany shortly thereafter seeking entry to the terminal pursuant to the Work Health and Safety Act 2011 (NSW). He was not admitted to the terminal. He remained in the administration foyer. He contacted SafeWork NSW.
[28] Throughout the period, inspections of the JPO Virgo by third parties were conducted by SafeWork NSW, the Australian Maritime Safety Authority (AMSA), INVER Engineering and Gibson Minto & Aiton Marine and Cargo Surveyors.
[29] SafeWork NSW took part in an inspection on the morning of Friday. John Whatman arrived at the terminal around 11am. After meeting with Mark Hulme, Ben Crosky, Paul Keating, Michael Walsh and Scott Shaw he inspected the JPO Virgo. Those present for the duration of the inspection were Ben Crosky, Troy Bentley and Michael Walsh. Scott Atkins and Scott Shaw were present for the first part of the inspection then handed over to Matt Lewis and Brad Dunn who were present for the remainder of the inspection.
[30] John Whatman took handwritten notes in his notebook on both 15 and 16 February 2019. The notes of 15 February 2020 included:[27]
On Friday 15 February 2019 Operational Group Liverpool on 9:30am-5:30pm
Reason for visit WSMS: 1-397430 S141 ROE dispute MUA Paul Keating
25 safety issues of broken stanchions, rails, flooring with very noticeable corrosion causing large holes and gaps
Through closed hatches visible holes allowing light to protruding (sic) through open holes obviously with no structural integrity to support the weight of a person stamping on the hatch sighted total of 72 colour photos of serious corrosion producing broken structure which damaged structural
Boarded vessel Virgo Troy Bentley Operations Supervisor transverse walkway 31' raised platform photographing many corroded railings used to secure harnesses
Continued along transverse walkways 49 noticeable serious corrosion along rails and walkway surfaces harsh covers at starboard side hinges broken approx. 10m drop to deck steel pieces missing from around outside of hatch which seats to TVW surface causing hatch to be at risk of falling through. Missing pieces 10mm-20mm approx. wide in 50mm approx. top mid rails due to corrosion.
No safe points of attachment for harnesses for workers to work at height safely when lashing or accessing containers
Eyelets on cables all corroded and broken. Bollards all corroded around vessel. No safety pins. Many bent or falling out due to corroded base not effective or structurally sound to prevent falling.
At about 3pm AMSA inspector boarded vessel walked straight past ignored all persons walk on stairs to bridge passed business card still continued to walk away. Never provided name remained silent. Surfaces of TVW heavily corroded large gouges in surfaces along every surface broken corrosion at all kickboards
Piles of corrosion in corners of TVW broken away from steel surface. Physically pressed top rails of TVW many flexed or broke away with body weight topes at hatch fencing not torqued not secured to support weight of person.
Starboard bow vessel perimeter fencing missing and replaced by weather rotted roped tied from s/container to corroded stanchion ropes not secured or tensioned imminent risk of falling
Ships hatches ropes not torqued. Eyelets corroded. Stanchion pins missing. Stanchions bent. Fencing missing imminent risk. No harness attachment points all fencing corroded and inadequate
[31] John Whatman's notes of 16 February 2020 included:[28]
On Saturday 16 February 2019 O/T Return to Work re DP World S141 dispute prohibition notices
Mark Hulme receive notice included both pages and handwritten amendment of 2011 to 2017 regulation
Hulme stated following in summary: "You and I met yesterday about the right of entry by Paul Keating you and I both disagreed as to his ROE. You boarded the vessel and said you will not be taking any action as it was not in your jurisdiction you agreed to inform the HSRs that we would be acting on the issues and you have then issued 4 prohibition notices. You said and I agreed to have an engineer inspect transverse walkways 31 & 49. The labour has been stood down last night for refusing to work the ship. Previously seen these procedures in practice and in this instance they are inadequate for the task. You have been issued 4 prohibition notices identifying imminent risk of which you must comply with clause 78. I am not satisfied that DP general procedures are adequate to meet and provide the level of safety procedures to manage these issues of imminent risk. DP must implement safety procedures special to these issues in consultation with HSRs. You and I discussed yesterday and agreed that TVW 31 & 49 will require an engineer to certify the structural integrity of the TVW. You have agreed to do this and I agree this is a step by DP to comply these notices. DP must follow clause 78 to comply the notices.
I said "No they are issued on the basis of reasonable belief you can seek a review if you wish or court"
Hulme said "Will you board the vessel now to comply the notices"
I said "Why DP has done nothing to comply the notices I am not here to do it for you DP has that duty I am not here to take responsibility for your duty in the Act. I am here today on a Saturday to provide compliance advice as I do with every customer I serve notices. Why should DP be treated differently by me or be given special treatment. If you follow my advice I am very confident that the notices will be complied very quickly and I am happy to view your compliance evidence as soon as you believe you have complied with the obligation of the notices. We all are seeking to resolve this safety matter ASAP and see the ship worked ASAP. We are not here to prevent this as I am here on a Saturday to provide this advice so you and the HSRs can improve safety on this vessel and work safely.
Hulme said "I do not believe this is a contravention and I want the notices withdrawn"
I said "This will not be happening compliance with the notices is not an onerous task if you follow my advice per C78 I am happy to view the evidence as soon as you can provide it to me tonight or tomorrow whenever in consultation with the HSRs. We are going around in circles now and not getting anywhere it is a matter for you if you follow my advice or not."
[32] John Whatman's notes of 18 February 2019 included:[29]
Met as a group discussed compliance evidence and safety procedures
HSRs and Facilitators raised concerns still O/S safety matters. I requested to inspect ship: AMSA contacted but not on site. Further discussion as to circumstances of issuing notices. Inspectors actions explained. Boarded vessel all above excluding Hulme. Sighted evidence of railing starboard bow cell TVW 31 & 49 and hatch mid ships covert fencing repaired. Both TVW certified as safe by engineer each repaired top, mid rail and all floor hatches. All notices closed as compliant email sent at 4pm.
[33] Brad Dunn remained on the vessel until around 3.30pm on Friday.[30] He compiled a report derived from his own observations and reports from others and provided the report at 9.10pm on Friday by email to Troy Bentley and Mark Hulme.[31] Michael Walsh had provided an interim report to Ben Crosky at around 4.30pm advising that Brad Dunn would finalise it.[32] In the email Brad Dunn asked supervisors to issue the vessel with a Notice of Deficiency. A Notice of Deficiency was issued by Troy Bentley to the Captain of the JPO Virgo, Boris Ivanov on Saturday 16 February 2019 (Saturday).[33]
[34] Rectification work was carried out by the crew of the JPO Virgo. Some work had commenced on Friday but the majority of it was done on Saturday and Sunday. At 1.56pm on Monday 18 February 2019 a rectification survey was emailed by Brad Dunn to DPW managers noting rectifications made.[34]
[35] AMSA is reported to have inspected the ship on the morning of Friday.[35] John Whatman's notes refer to an AMSA inspector boarding the vessel at about 3pm on Friday. The reports of AMSA inspections state that inspections took place on Saturday and on 19 February 2019. Two reports were provided. AMSA did not issue prohibition notices.[36]
[36] Scott Aiton, of Gibson Minto & Aiton, inspected the JPO Virgo at the request of DPW on the morning of Saturday. The purpose of the inspection was to report on compliance with Marine Orders 12, 32 and 42. Marine orders are contained in Australian maritime legislation. Marine Order 32 (MO 32) relates to cargo handling equipment and activities relating to the loading and discharging of ships at Australian ports.[37] A handwritten report provided around 11am contained the following deficiencies:[38]
[37] A more comprehensive report was provided to DPW on Tuesday 19 February 2019.[39]
[38] INVER Engineering attended mid-morning on Saturday. A structural engineer Venket Naidu inspected the transverse walkways in bays 31 and 49 of the JPO Virgo. The report was provided to DPW around 6pm on the same day.[40] The report was in the form of an email and a series of photographs and reported that structurally the walkways were considered satisfactory for intended use.
[39] At 2.30pm on Saturday Neville Johnstone, DPW's Safety, Environment, Security and Training Manager, met with employees and commenced the preparation of a document "Hazards and control measures for JPO Virgo". Neville Johnstone provided this completed document to Mark Hulme at 9.30pm on Saturday.[41]
[40] Work was not performed on the JPO Virgo from the time of its berth until the evening shift on Sunday 17 February 2019 (Sunday).[42] Employees allocated to work the JPO on the day shift on Friday were redeployed to the YM Vancouver.[43] Employees allocated to work the JPO Virgo on the night shift on Saturday 16 February 2019 and day shift Sunday 17 February 2019 were redeployed to a vessel called the ANL Tongala.[44]
[41] Employees on the day shift on Friday had access to the information posted by Michael Walsh on the 12 Berth Vessel Safety Board after 9.30am.
[42] Mark Hulme receive feedback from Troy Bentley that DPW supervisors reported that employees refused to work the JPO Virgo until the safety issues were resolved and only if Paul Keating was allowed on site and they had an opportunity to speak with the MUA.[45]
[43] Brad Dunn gave evidence that, at the shift change meeting at 2pm, he or one of the delegates advised workers present of the safety concerns on the JPO Virgo.[46]
[44] At the conclusion of the inspection around 2.45pm, John Whatman met with Mark Hulme and Ben Crosky and then at 3pm with Paul Keating and HSRs. Paul MacAleer, Secretary of the MUA Sydney Branch, may have been present but the evidence is unclear and nothing turns on it.
[45] There is no evidence that in either of these meetings John Whatman foreshadowed any decisions he had made or any action he was going to take.
[46] Mr Hulme gave evidence of exchanges with John Whatman that lead him to believe that John Whatman considered that the ship could be worked with appropriate controls.[47]
[47] There is no evidence that the contents of John Whatman's notebook was shared with employees on Friday. There is evidence that John Whatman made comments about the state of the JPO Virgo to Matt Lewis and Brad Dunn whilst inspecting the vessel.[48] Matt Lewis gave evidence that after the inspection he spoke to Ben Crosky and following this either he or Brad Dunn addressed the workforce. He said the workers voted not to work on the vessel on the basis that it was unsafe to do so.[49]
[48] Mark Hulme gave evidence that at 5.30pm John Whatman contacted him by telephone and advised that he had been directed to issue DPW with "Improvement Notices" in relation to transverse walkways on bays 31 and 49, rusted handrails, forward deck fencing and fall protection (fencing) to the side of the vessel and handrails not being taut enough. He also advised Mark Hulme that he should arrange for a structural engineer to inspect bays 31 and 49. Mark Hulme acted upon this and engaged INVER Engineering as outlined above. He said John Whatman also said that work could commence on the other bays once DPW implemented controls.[50]
[49] Mark Hulme formed the view that work could commence in nine alternative areas on the vessel. He said:
"Based on the information provided by Mr Whatman and my review of the vessel work program, I satisfied myself that we could commence work on the vessel in nine alternative areas, which would have still enabled up to five crane gangs to commence operating. This would avoid using bays 31 or 49 (50) until these could be assessed by an engineer. The remaining issues relating to inadequate fall protection and rusted and slack handrails would be dealt with by implementing normal controls."[51]
[50] Mark Hulme gave evidence that around 5.30pm Brad Dunn sought permission to speak with employees during a rest break. He said Brad Dunn spoke to him following this and reaffirmed the position that employees allocated to crane gangs or vessel operations would not work the Virgo until such time as Mr Keating was granted access to the terminal, but that employees would perform any other work that was available.[52]
[51] These employees were addressed by Mark Hulme at the conclusion of this rest break. Mark Hulme gave evidence that he said words to the effect:
"The Virgo arrived this morning. As is normal practice a vessel inspection was undertaken that has identified a number of hazards. We attempted to sit down with employees and discuss controls as is normal practice, however employees have refused to participate in this process across the day shift unless I allowed Paul Keating on site. A SafeWork inspector attended site this morning at the request of the MUA. No employee was exposed to any imminent risk as no vessel operations were occurring and I therefore refused Paul Keating access. This is an industrial matter and not a safety matter and directly linked to us accepting this vessel as a subcontract from Hutchison. SafeWork has indicated we can work the vessel after implementing controls with the exception of two areas which require inspection by an engineer. On this basis I questioned whether employee representatives would engage in working through appropriate controls."[53]
[52] Mark Hulme gave evidence that he addressed employees prior to them returning to work and said words to the effect:
"There is no other work for crane gangs to complete. The position of not working the Virgo amounts to a refusal of a reasonable direction by Management and therefore unprotected industrial action. Any employee who refuses to work waterside operations will be stood down, will be docked a minimum of 4 hours pay and will be receiving a warning letter."[54]
[53] Mark Hulme said that Brad Dunn said in response:
"We don't believe this is illegal industrial action, it's a safety issue and you won't let Keating in. Everyone else go to work, crane gangs stay in the smoko room, we'll argue this at a later time. We are available to do any other work. No one goes home, we are all staying."[55]
[54] Michael Walsh gave evidence about this same meeting.[56] He recounted exchanges based on his contemporaneous notes that were attached to his statement marked MW5 as follows:
"At approximately 5:05PM Mr Hume addressed the workforce in the common room:
Hulme: There are some safety issues on the vessel. SafeWork NSW will be issuing 3 PINS. These areas can be made safe.
Dunn: We are happy to do workarounds provided we receive the assistance of our representative Paul Keating in assessing hazards and controls. There are confirmed safety issues as Mark has admitted.
Hulme: I have declined entry to the site for Paul Keating. He has not complied with the Act. Areas can be made safe. I am directing the crane gangs to go to work.
Dunn: Our representative is deprived of access. The PIN Notices establish safety issues. This is not illegal action.
Hume: If a person complies, they can come in. I am not telling the MUA how to operate. He must comply with the Act. This vessel was worked at DP World Brisbane and at Hutchison.
Lewis: We are not bound by what Hutch put up with; you are admitting there are safety issues and refusing access to our safety representative.
Hulme: I will put you off work, all the crane gangs, if you don't work the vessel."[57]
[55] Ben Crosky gave evidence that some employees were directed to perform alternative work during the evening shift. Employees allocated to work waterside were not able to be usefully employed. Employees allocated to work landside worked as usual.[58]
[56] Mark Hulme gave evidence that he addressed employees allocated to the JPO Virgo for the night shift at 10pm. His evidence was that he asked the employees if they were prepared to go to work and that his recollection was that the general consensus was that unless and until Paul Keating was allowed access to the terminal they would refuse to meet with managers to discuss controls that could be implemented to mitigate safety risks and to perform crane related work on the JPO Virgo as directed.[59]
[57] At around 11pm on Friday four prohibition notices were issued by SafeWork NSW were received by DPW. The prohibition notices stated:[60]
I, John Whatman reasonably believe on 15/02/2019 at 2:00:00PM that an activity may occur at the workplace that will involve a serious risk to the health or safety of a person emanating from an imminent exposure to a hazard and that this activity is likely to contravene a provision of the Work Health and Safety Act 2011, section 19 and Work Health and Safety Regulation 2017, clause 78.
I direct the person with control over the following activity of: Cease access prevent workers on Transverse walkway 31. Stop the carrying on of the activity in the following way prevent any stevedoring work on Transverse walkway 31. Until an inspector is satisfied that the following matters that will give rise to the risk have been remedied:
Directions on the measures to be taken to remedy the risk, activities or matters or the contravention or likely contravention:
I, John Whatman reasonably believe on 15/02/2019 at 2:00:00PM that an activity may occur at the workplace that will involve a serious risk to the health or safety of a person emanating from an imminent exposure to a hazard and that this activity is likely to contravene a provision of the Work Health and Safety Act 2011, section 19 and Work Health and Safety Regulation 2017, clause 78.
I direct the person with control over the following activity of: Cease access prevent workers on Transverse walkway 49. Stop the carrying on of the activity in the following way prevent any stevedoring work on Transverse walkway 49. Until an inspector is satisfied that the following matters that will give rise to the risk have been remedied:
Directions on the measures to be taken to remedy the risk, activities or matters or the contravention or likely contravention:
I, John Whatman reasonably believe on 15/02/2019 at 2:00:00PM that an activity may occur at the workplace that will involve a serious risk to the health or safety of a person emanating from an imminent exposure to a hazard and that this activity is likely to contravene a provision of the Work Health and Safety Act 2011, section 19 and Work Health and Safety Regulation 2017, clause 78.
I direct the person with control over the following activity of: Cease access prevent workers on accessing starboard bow. Stop the carrying on of the activity in the following way Cease stevedoring and lashing. Until an inspector is satisfied that the following matters that will give rise to the risk have been remedied:
Directions on the measures to be taken to remedy the risk, activities or matters or the contravention or likely contravention:
I, John Whatman reasonably believe on 15/02/2019 at 2:00:00PM that an activity may occur at the workplace that will involve a serious risk to the health or safety of a person emanating from an imminent exposure to a hazard and that this activity is likely to contravene a provision of the Work Health and Safety Act 2011, section 19 and Work Health and Safety Regulation 2017, clause 78.
I direct the person with control over the following activity of: Prevent workers near open ships hatches. Stop the carrying on of the activity in the following way Cease stevedoring and lashing. Until an inspector is satisfied that the following matters that will give rise to the risk have been remedied:
Directions on the measures to be taken to remedy the risk, activities or matters or the contravention or likely contravention:
[58] Mark Hulme gave evidence that he formed the view around 12.30am on Saturday that DPW could not lawfully direct employees to perform work on the JPO Virgo whilst the prohibition notices were in place.
[59] Mark Hulme gave evidence that on the night shift commencing on Friday approximately 16 employees were found work operating additional RTG crane equipment for four hours of their shift and there was no useful work for approximately 10 employees allocated to quayside points of work for the duration of their shift.[61]
[60] Mark Hulme addressed the day and evening shifts on Saturday. His evidence was to the effect that the prohibition notices prevented DPW from directing employees to perform work on the JPO Virgo.[62]
[61] Mark Hulme gave evidence that approximately 16 employees were found useful work for just under four hours of their shift on the day shift and 12 employees were found useful work on the evening shift. There was no useful work for the balance of the employees.[63]
[62] The prohibition notices were lifted by John Whatman by way of email at 3.57pm on Monday 18 February 2019.[64] On the same day DPW applied to SafeWork for an internal review of the decisions to issue the four prohibition notices. The result of the internal review was that the decisions were set aside and substituted with the decision to take no further action in relation to these notices.[65]
[63] Part 3-5 of the FW Act contains sections of the FW Act that concern stand down of employees. Section 524 of the FW Act provides that an employer may stand down an employee or employees for a period of time in certain circumstances and that the employer is not required to make payments for that period of time.
524 Employer may stand down employees in certain circumstances
(1) An employer may, under this subsection, stand down an employee during a period in which the employee cannot usefully be employed because of one of the following circumstances:
(a) industrial action (other than industrial action organised or engaged in by the employer);
(b) a breakdown of machinery or equipment, if the employer cannot reasonably be held responsible for the breakdown;
(c) a stoppage of work for any cause for which the employer cannot reasonably be held responsible.
(2) However, an employer may not stand down an employee under subsection (1) during a period in which the employee cannot usefully be employed because of a circumstance referred to in that subsection if:
(a) an enterprise agreement, or a contract of employment, applies to the employer and the employee; and
(b) the agreement or contract provides for the employer to stand down the employee during that period if the employee cannot usefully be employed during that period because of that circumstance.
Note 1: If an employer may not stand down an employee under subsection (1), the employer may be able to stand down the employee in accordance with the enterprise agreement or the contract of employment.
Note 2: An enterprise agreement or a contract of employment may also include terms that impose additional requirements that an employer must meet before standing down an employee (for example requirements relating to consultation or notice).
(3) If an employer stands down an employee during a period under subsection (1), the employer is not required to make payments to the employee for that period.
[64] Section 526 of the FW Act provides that the FWC may deal with a dispute about the operation of Part 3-5.
526 FWC may deal with a dispute about the operation of this part
(1) The FWC may deal with a dispute about the operation of this Part.
(2) The FWC may deal with the dispute by arbitration.
Note: The FWC may also deal with a dispute by mediation or conciliation, or by making a recommendation or expressing an opinion (see subsection 595(2)).
(3) The FWC may deal with the dispute only on application by any of the following:
(a) an employee who has been, or is going to be, stood down under subsection 524(1) (or purportedly under subsection 524(1));
(b) an employee in relation to whom the following requirements are satisfied:
(i) the employee has made a request to take leave to avoid being stood down under subsection 524(1) (or purportedly under subsection 524(1));
(ii) the employee's employer has authorised the leave;
(c) an employee organisation that is entitled to represent the industrial interests of an employee referred to in paragraph (a) or (b);
(4) In dealing with the dispute, the FWC must take into account fairness between the parties concerned.
[65] The FWC's power to deal with a dispute concerning the stand down of employees is clear from section 526 and section 595 of the FW Act.
(1) The FWC may deal with a dispute only if the FWC is expressly authorised to do so under or in accordance with another provision of this Act.
(2) The FWC may deal with a dispute (other than by arbitration) as it considers appropriate, including in the following ways:
(b) by making a recommendation or expressing an opinion.
(3) The FWC may deal with a dispute by arbitration (including by making any orders it considers appropriate) only if the FWC is expressly authorised to do so under or in accordance with another provision of this Act.
Example: Parties may consent to the FWC arbitrating a bargaining dispute (see subsection 240(4)).
(4) In dealing with a dispute, the FWC may exercise any powers it has under this Subdivision.
Example: The FWC could direct a person to attend a conference under section 592.
(5) To avoid doubt, the FWC must not exercise the power referred to in subsection (3) in relation to a matter before the FWC except as authorised by this section.
[66] In this case DPW relies on the circumstances contained in s.524(1)(a) being industrial action and s.524(1)(c) being a stoppage of work for any cause for which the employer cannot be held responsible.
[67] Industrial action is defined in s.19 of the FW Act as follows:
(1) Industrial action means action of any of the following kinds:
(a) the performance of work by an employee in a manner different from that in which it is customarily performed, or the adoption of a practice in relation to work by an employee, the result of which is a restriction or limitation on, or a delay in, the performance of the work;
(b) a ban, limitation or restriction on the performance of work by an employee or on the acceptance of or offering for work by an employee;
(c) a failure or refusal by employees to attend for work or a failure or refusal to perform any work at all by employees who attend for work;
(d) the lockout of employees from their employment by the employer of the employees.
Note: In Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v The Age Company Limited PR946290, the Full Bench of the Australian Industrial Relations Commission considered the nature of industrial action and noted that action will not be industrial in character if it stands completely outside the area of disputation and bargaining.
(2) However, industrial action does not include the following:
(a) action by employees that is authorised or agreed to by the employer of the employees;
(b) action by an employer that is authorised or agreed to by, or on behalf of, employees of the employer;
(i) the action was based on a reasonable concern of the employee about an imminent risk to his or her health or safety; and
(ii) the employee did not unreasonably fail to comply with a direction of his or her employer to perform other available work, whether at the same or another workplace, that was safe and appropriate for the employee to perform.
(3) An employer locks out employees from their employment if the employer prevents the employees from performing work under their contracts of employment without terminating those contracts.
Note: In this section, employee and employer have their ordinary meanings (see section 11).
[68] Section 474 (1) of the FW Act prevents an employer from paying an employee engaged in unprotected industrial action.
Payments not to be made relating to certain periods of industrial action
(1) If an employee engaged, or engages, in industrial action that is not protected industrial action against an employer on a day, the employer must not make a payment to an employee in relation to:
(a) if the total duration of the industrial action on that day is at least 4 hours--the total duration of the industrial action on that day; or
Note: This subsection is a civil remedy provision (see Part 4-1).
(2) However, if the industrial action is, or includes, an overtime ban, this section does not apply, in relation to a period of overtime to which the ban applies, unless:
(a) the employer requested or required the employee to work the period of overtime; and
(b) the employee refused to work the period of overtime; and
(c) the refusal was a contravention of the employee's obligations under a modern award, enterprise agreement or contract of employment.
[69] Clause 21.7.3 of the Agreement is also said to be relevant to the dispute. It reads as follows:
21.7.3 Where Employees have a reasonable concern of a serious risk arising from immediate, imminent or impending hazard, work may cease in the immediate vicinity until the issue is investigated and dealt with in accordance with established processes.
[70] The relevance of this clause is said by the MUA to be that conduct in accordance with this subclause of the Agreement would fall into the exception to the meaning of industrial action contained in s.19(2)(a) of the FW Act.
[71] Case law provides guidance on dealing with a dispute under this part of the FW Act.
[72] In SSX Services Pty Ltd v The Australian Workers' Union[66] (SSX decision) it was held that it was important to characterise the dispute. The Full Bench said:
"[17] We have set out the relevant legislative provisions above because of their importance to considering the grounds of appeal. Importantly, the right to stand down employees under s.524 arises from the effect of the section itself. The right is not dependent on approval of the Commission. However, to the extent that a dispute arises in relation to the exercise of that right, the Commission is empowered by s.526 to deal with that dispute by arbitration. The Commission is required to take into account fairness between the parties concerned and thereby incorporate an overall discretionary factor into the task of determining a dispute over whether the right to stand down is correctly invoked in the circumstances. The parties are bound by s.527 to comply with an order of the Commission dealing with a dispute. These provisions make it important to correctly identify the subject matter of a dispute the subject of arbitration for the purposes of any such order.
[18] The characterisation of disputes arises in various contexts under the Act, most particularly in relation to disputes arising from the application of awards and agreements. It is necessary to have regard to the nature of a dispute alleged in an originating application and the factual circumstances as they evolve for the purposes of conciliation and arbitration of the dispute. A Full Bench of the Commission's predecessor expressed the importance of characterising a dispute in this way, albeit in a different statutory context, namely the resolution of disputes arising under certified agreements made under the Workplace Relations Act 1996 (Cth):
"[45] A dispute referred to the Commission must be properly characterised before powers conferred by a dispute settlement provision in a certified agreement are exercised. This is necessary in order to determine whether the dispute is 'over the application of the agreement' within the meaning of s.170LW of the WR Act.
[47] In characterising the nature of the dispute in this matter the Commission is not confined to the dispute notification document. The entire factual background is relevant, including matters such as the submissions advanced. In this context we note that in TWU v Mayne Nickless Ltd the Full Court of the Federal Court held that in determining whether an application calls on the Commission to exercise judicial, as opposed to arbitral, power 'a court should review the entire factual background to properly characterise the claim and the power sought should be invoked."
[19] In Maritime Union of Australia v Australian Plant Services Pty Ltd, Lacy SDP said:
"Parliament has authorised the Commission to exercise powers under the agreement to settle disputes over the application of the agreement and, accordingly, its powers are limited to disputes of that kind. Therefore it is necessary for the Commission, in each case where it is asked to deal with the matter arising under the disputes settling procedure in an agreement, to ascertain the character of the dispute before it in order to determine whether the matter is a dispute over the application of the agreement, and, importantly, the character of the dispute is distinguishable from the order that may be made in settlement of the dispute."
[20] We consider that the arbitration of the dispute under s.526(1) and (2) of the Act requires similar characterisation by the Commission for the purposes of any arbitration of such a dispute."
[73] In Construction, Forestry, Maritime, Mining and Energy Union v DP World Melbourne Ltd[67] (DP World Melbourne Ltd decision) Deputy President Colman said that the exercise of the right to stand down must be volitional (on the part of the employer). He said:
"[37] Section 524 commences by stating that an employer may, 'under this section', stand down an employee during a period in which the employee cannot usefully be employed because of one of the three circumstances that are then identified. The significance of an employer standing down an employee is that the employer is not required to make payments to the employee for the period of the stand down (s 524(3)). The section confers a right on an employer not to pay employees in particular circumstances. In my view, the exercise of the right must be volitional. I find it difficult to see how an employer could be said to have stood down an employee under s 524 if it did not exercise its right under that section."
"[62] Further, there was no evidence of any stoppage of work surrounding any of the stand downs of EC 225 Pilots. The circumstances contemplated by subsection 524(1)(c) of the Act would require identification of some event which involved work being consciously halted for some reason and ordinarily for some identified period of time. A reduction in the available work for the EC 225 helicopters, for whatever reasons, does not represent a stoppage of work in satisfaction of the terms of subsection 524(1)(c) of the Act."[70]
[75] In "Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU) v McCain Foods (Aust) Pty Ltd[71] (McCain decision), Vice President Watson considered the meaning of "usefully employed". The Vice President quoted Morling J in Townsend v General Motors Holden's Ltd[72] who said:[73]
"In my opinion the question whether an employee cannot be usefully employed because of a strike is largely a question of fact. No doubt, as a matter of law, some considerations will be irrelevant in determining the question of fact. But I reject the argument that the economic consequences to the employer are to be ignored in deciding the whether employees can be usefully employed. I accept that it is a material matter that work has been scheduled to be done by an employee on a day when, in fact, he is stood down. In many cases that will be a powerful indication that the work which was scheduled to be done was work which would have been useful to the employer. If the employee is stood down in those circumstances the employer will necessarily have to establish that because of circumstances that arose after the work was first scheduled to be done, the employee could not be usefully employed.
What I have said so far does not mean that cl. 6(g)(g) of the award gives GMH the right to unilaterally stand down its employees whenever there is a strike and it is convenient for it to do so. An employee may be able to be usefully employed although, as a matter of convenience, GMH would prefer him not to be at work. Questions of fact and degree will always be involved in determining whether, on the one hand, an employee cannot be usefully employed or whether, on the one hand, an employee cannot be usefully employed or whether, on the other hand, he can be usefully employed but it is not convenient to GHM to employ him. Whether a particular set of facts falls on one side of the line or to the other will itself be a question of fact. In deciding that question I think it is proper to take the approach which Shepperd J. thought appropriate in a somewhat similar context - see In re Dispute - Australian Iron & Steel Pty Ltd; re Stand down of Bricklayers (No. 1) (1972) A. R. (N.S.W.) 285 at p.296. That is to say, if it is shown that an employer has acted upon proper principles and in good faith, "the evidence... will not... be done through with a tooth-comb in order to apply its actions a standard of perfection which in cases such as this will always be impossible to achieve"."
[76] In applying this to the circumstances of the dispute before him, Vice President Watson said:
"[26] McCain determined that some useful work could be undertaken but other work was either of no benefit or a threat to safe and productive operations leading to potential raw material loss or product damage. I see no reason to question the conclusions reached by the company on the existence or otherwise of useful work on 14 September. I therefore find that the stand down was validly implemented in accordance with s524 of the Act.
[27] Further I do not consider that any alteration to the situation brought about by the stand downs is justified by general notions of fairness. McCain's production was affected by the maintenance strike. It sought to minimise its losses by implementing savings on its wages bill for the day in accordance with its statutory rights which I have found to be validly exercised under the Act. If it had not stood down the employees at the time they would have been idle. Those employees who could have been usefully employed worked and were paid. Others were stood down or took paid leave. Although stand downs are generally unfortunate, in this case they were the natural consequence of the strike by maintenance employees."[74]
[77] In Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia & Anor v FMP Group (Australia) Pty Ltd[75] (FMP decision) it was held that there needs to be a temporal connection, as well as a causal connection, between one of the circumstances arising (that is, industrial action; a breakdown of machinery or equipment; a stoppage of work) and the standing down of an employee because the employee cannot usefully be employed. In that decision, Deputy President Gostencnik said:
"[31] Section 524(1) is intended to relieve an employer of the obligation to pay wages to employees who cannot be usefully employed in certain limited circumstances. The consequences of a stand down can be severe for an employee as the employee may be deprived of wages for a lengthy period. Whether a particular employee can be usefully employed is a question of fact to be determined having regard to the circumstances that face the employer. The circumstances and their effect on the capacity of an employer to usefully employ a particular employee cannot be known in advance of the circumstance arising, although educated guesses may be made. Section 524(1) is unlikely to have been intended to operate so as to deprive an employee of wages and to relieve an employer of the obligation to pay wages before one of the circumstances in s.524(1)(a)-(c) has arisen. Indeed the structure and language of s.524(1) shows that there needs to be a temporal connection between one of the circumstances arising and the standing down of an employee because the employee cannot usefully be employed. The words "because of" in s.524(1) are used to indicate a causal link between the occurrence of a circumstance and the absence of useful employment. In that sense, the alleged absence of useful employment for the Relevant Employees cannot be said to have been caused by industrial action, as no industrial action had taken place at the time the Relevant Employees were stood down.
[32] It follows, in my view, that in order for an employer to validly exercise its right under s.524(1)(a), the employee who is to be the subject of a stand down must, at the time of being stood down, be engaging in the industrial action/have previously engaged in industrial action which causes the unavailability of useful employment, or have his or her capacity to be usefully employed affected by the industrial action of others that is happening or has happen. It cannot be said that the Relevant Employees could not usefully be employed during a period unless that period is affected by actual industrial action taken by then. Consequently, in my view, the Employer did not have a proper basis to stand down the Relevant Employees under s.524(1)(a). Given that finding, it is unnecessary for me to consider whether the Relevant Employees could usefully be employed in the event that the industrial action eventuated."[76]
[78] The Full Bench in the Bristow Helicopters decision quotes this decision with approval.[77]
[79] In the SSX decision it was held that that the FWC is required to take into fairness between the parties concerned and thereby incorporate an overall discretionary factor into the task of determining a dispute over whether the right to sand down in correctly invoked in the circumstances.
[80] In Mr Stephen Ball v Thomas Foods International Murray Bridge Pty Ltd[78] (Thomas Foods decision), fairness was described as "what is right and just between the parties having regard to the relevant statutory framework and the facts and circumstances established by the evidence".[79] In that case Deputy President Anderson decided that he would determine the dispute having regard to considerations of fairness irrespective of the lawfulness or unlawfulness of the stand down.
[81] The Bristow Helicopters decision also addressed the remedy in determining a dispute under s.596. It determined that the order sought was beyond the power of the FWC to grant. The Full Bench said:
"[55] We note the following extract from paragraph [567] of the decision in Hatchett v Bowater Tutt Industries Pty Ltd (hereafter "Hatchett"):
"A claim for payment of wages, or for wrongful dismissal, or for breach of an award in whatever form the claim of legal right may have been cast is beyond the jurisdiction of the Commission. This is clearly established by a series of decisions of the High Court ..."
[56] Further, in R v Gough; Ex parte Key Meats Pty Ltd (hereafter "Gough"), Gibbs CJ stated:
"However, the Commission had no jurisdiction to determine the legal rights of the employees who had been stood down or to enforce the rights given by the award."
[57] We are of the view that the circumstances in Gough are not dissimilar from those in the present case. Namely, there has been "an attempt to secure payment by the prosecutor to the employees who had been stood down." As the dispute involves a claim for payment of wages as outlined in Hatchett and revolves around the legal rights of the affected parties as referred to in Gough, we are of the view that making an Order in such circumstances is beyond the jurisdiction of this Commission. As such, Order 2 made by the Commissioner pursuant to the section 526 application is beyond the jurisdiction vested in the Commission."
[82] This decision was quoted with approval in the DP World Melbourne Ltd decision. Deputy President Colman said:
"[48] In Bristow Helicopters Australia Pty Ltd v AFAP, a Full Bench of the Commission overturned a decision that had determined that an employer had contravened s 524. Pursuant to the decision, orders had been issued requiring the employer to treat the stand downs as null and void and to pay the affected employees their wages for the relevant period. The Full Bench held that these orders were beyond power, and referred to the decision of Gibbs CJ in R v Gough; Ex parte Key Meats Pty Ltd, where his Honour affirmed that the Commissions predecessor had no jurisdiction to determine the legal rights of employees who had been stood down, or to enforce their award rights. The Full Bench upheld a different order made by the Commissioner, which had required that the employer withdraw the stand downs and, prospectively, allow employees to return to work. This order was permissible, as it created new rights and obligations and involved the exercise of arbitral power. In my view, Bristow Helicopters usefully illustrates the proper limits of the Commission's power under s.526."
[83] The MUA describe the issues in dispute between the parties are as follows:[80]
(1) was the Respondent able to stand down the employees under one or other of the circumstances under ss 526(1)(a)-(c) on 15-17 February 2019?
(2) if so, were employees able under clause 21.7 of the Agreement to cease work in and about the JP Virgo?
(3) was the Respondent able under Part 3-5 of the FW Act to not make payments to employees on 15-17 February 2019?
[84] Fundamentally the parties are in dispute about the deduction of pay from employees over the four shifts on Friday and Saturday during which work was not performed on the JPO Virgo and the warning letters issued to employees in respect of the evening shift on Friday.[81]
[85] The primary conflict between the parties is not the existence of problems and deficiencies on the vessel. The conflict between the parties surrounds what they say the response should have been to those deficiencies. DPW say that there was nothing so unusual about the deficiencies that could not be overcome by utilising the controls available. It was put by DPW, and not contradicted by the MUA, that the usual practice was for employee representatives to work with managers to develop the controls. I note that although it was repeatedly said that this was the usual procedure, neither of the two procedures provided set this out. In any event, the MUA say that the deficiencies were so widespread and serious that the usual practice was not adequate and the problems could not be overcome without rectification works being done on the vessel.[82]
[86] Brad Dunn in response to a question from me said:
"... the only difference between us and management was they thought we could work around it and isolate things like we typically do, but we couldn't because there was just so much - there was just so much that wasn't right and it was in such a poor state from say zero one all the way through up to 18, the length of the vessel, and it was very hard to isolate, and management didn't understand why we couldn't just isolate and keep - keep going, and that was the point of difference."[83]
[87] DPW pointed out in its closing submissions that this is not a Royal Commission of inquiry into the state of the JPO Virgo when it presented at PBT on 15 February 2019.[84] DPW said that the FWC should not sit as a court of safety jurisdiction seeking to make definitive findings about defects or otherwise with this vessel, saying "the evidence does not give the full picture".[85] I agree. I consider that I do not have to reconcile the conflict identified above. The matters that I need to consider do not depend on whether DPW or the employees and their representatives were correct about the state of the JPO Virgo.
[88] The questions I will deal with are:
Did employees engage in industrial action at DPW PBT on the evening shift on Friday 15 February 2019?
If employees were engaged in industrial action, were the employees stood down unable to be usefully employed because of the industrial action?
Was DPW required to deduct pay from the employees stood down pursuant to s.470 of the FW Act?
Was there a stoppage of work on Saturday 16 February 2019?
If so, was the stoppage of work for a cause for which DPW could not reasonably be held responsible?
If so, were the employees stood down unable to be usefully employed because of the stoppage of work?
Is the relief sought by the MUA beyond the power of the FWC to grant?
What is an appropriate resolution of the dispute taking into account fairness between the parties?
[89] I will now turn to my consideration of each of these questions.
Did employees engage in industrial action at DPW PBT on the evening shift and part of the night shift on Friday 15 February 2019?
[90] The employees in question are the employees who were allocated to work the JPO Virgo for the evening shift on Friday February 2019. Safety Facilitators and Health and Safety Representatives (HSRs) who took part in inspections and gave evidence in this matter are not included in this cohort. These employees were not considered by DPW to have taken industrial action.
[91] The employees in question did not work the JPO Virgo. None of the employees in question gave evidence. Evidence was given by witnesses for both the MUA and DP World that the employees refused to work the vessel.
[92] Witnesses for DPW gave evidence that they believed this was because the vessel was on contract from Hutchison Ports, another stevedore operator in PBT, where protected industrial action employees was being taken in support of enterprise bargaining.
[93] Mark Hulme anticipated that the employees would find issues on the JPO Virgo.[86] Ben Crosky gave evidence that Troy Bentley told him that he had been out on the JPO Virgo and the employees were looking for issues.[87]
[94] Mark Hulme described this an industrial rather than a safety matter.[88]
[95] Witnesses for the MUA gave evidence that the reason for this was the employees' concern that the JPO Virgo was not safe to work. Michael Walsh thought it was the worst vessel he had seen present in the 10 years he had been conducting ship inspections.[89] Brad Dunn said there was just so much that wasn't right and it was in such a poor state.[90] That Michael Walsh and Brad Dunn are safety facilitators with specialist qualifications and roles is relevant to the attitude of employees upon receiving reports from them.
[96] Witnesses for DPW gave evidence that employees were not being directed to work the vessel but directed to work with management to develop controls to mitigate the risks identified in the inspections that took place.[91]
[97] I accept that DPW did not intend that work be performed in the areas of the vessel with risks without controls in place. I accept that employee representatives would not work with managers in accordance with the usual practice to develop controls.
[98] Witnesses for the MUA gave evidence that the reason for that was that the risks identified in the inspections required remediation, and controls would not be adequate. I accept that they genuinely believed that.
[99] I do not accept that the reason that employee representatives would not work with managers to develop controls was because of the industrial action at Hutchison Ports. I accept that there is a temporal connection between the JPO Virgo arriving at DPW and the industrial action at Hutchison Ports but there is no evidence to suggest a causal connection between this and the refusal to work the vessel.
[100] Witnesses for the DPW and the MUA also gave evidence that employee representatives would not meet with management to discuss the situation without their MUA official Paul Keating. I don't consider that as evidence of the connection with the Hutchison Ports industrial action. I consider that the evidence supports this as being connected to the employee representatives' opinion about the state of the vessel and their desire to be represented by their official in discussions with DPW management about whether the vessel could be worked with controls or not.
[101] Witnesses for the MUA gave evidence that employees were directed to work the vessel.[92] Mark Hulme's evidence is that at 5.30pm on Friday he told employees that "any employee who refuses to work waterside operations will be stood down".[93] Ben Crosky said that Mark Hulme said words to the effect, "Everyone should attend their points of work and start work on the vessel".[94] Mark Hulme told employees that the vessel could be worked in areas other than the areas that John Whatman advised him about.[95]
[102] That employees refused this direction was the action that in the absence of the exceptions to the industrial action in s.19(2) would be industrial action.
[103] Employees cannot be said to have taken industrial action if the action was based on a reasonable concern about an imminent risk to health or safety for the purposes of s.19(2)(c) of the FW Act.
[104] This is an exception to the definition of industrial action found in s.19(1). It has a subjective element (concern) and an objective element (reasonable). To consider whether the employees in question were subject to this exception I need to consider the state of mind of the employees and whether that was reasonable. I must do so on the evidence available. The relevant evidence is not what the Safety Facilitators and HSRs believed or what DPW management believed but what the employees knew, what their response to that was and whether it was reasonable. To some extent I must stand in the shoes of the employees and ask myself 'given what was heard about the state of the ship, and from whom and given what they saw on the notice board, would they be concerned?' This is the subjective element. Then the objective question 'would it be reasonable for them to be concerned?'.
[105] Employees were able to see what was written on the safety board. Employees were aware that SafeWork had inspected the vessel. Employees heard reports from Safety Facilitators and HSRs that described some comments the SafeWork Inspector was said to have made. Employees were told by the Safety Facilitators and HSRs that they had safety concerns and that remediation work was planned
[106] DPW said that there were routine control measures available which it proposed to put in place to manage the risks to employees who were required to board the JPO Virgo.[96] DPW submitted that these were all measures that the employees were familiar with. I don't doubt that in the general. But the specific measures that were proposed for the specific parts of the vessel would need to have been made explicit for fears to be allayed. Mark Hulme gave evidence about the parts of the vessel he believed could be safely worked - nine areas in total. But there was no evidence that this detail was ever presented to employees.
[107] There is a lot of evidence about what happened after the evening shift on Friday, but none of that could have been known by employees who refused to work that shift, and I have not relied upon it in coming to my conclusion.
[108] In all the circumstances I consider that on that evening on Friday a reasonable person would have a concern about an imminent risk to their safety if they were to work the vessel. The concern was therefore a reasonable concern. I am satisfied that the exception in s.19(2)(c)(i) is invoked by the circumstances that presented and that the employees were not engaged in industrial action. There is no suggestion that this is negated by s.19(2)(c)(ii) as employees who were directed to perform other available work did so.
[109] The MUA asserted that employees were entitled to exercise their rights under clause 21.7.3 of the Agreement. It was put that the exception in s.19(2)(a) was triggered, making the refusal to work authorised for the purposes of s.19(2)(a) of the FW Act. The wording of clause 21.7.3 of the Agreement is different to s.19(2)(c) of the FW Act. DPW submitted that the words 'serious' and 'hazard' set a higher bar and that the clause meant that work could stop in certain areas rather than a whole vessel. It is not necessary for me to make a finding about this because I am satisfied that the exception in s.19(2)(c)(i) is invoked by the circumstances that presented and that the employees were not engaged in industrial action.
[110] I consider that DPW was not entitled to deduct pay for this period in accordance with s.524(2)(c).
[111] The employees who refused to work on the evening shift on Friday 15 February 2019 should not have been issued with warning letters and should not have had pay deducted for part of the shift.
If employees were engaged in industrial action were the employees stood down unable to be usefully employed because of the industrial action?
[112] In the light of my conclusion that the employees were not engaged in industrial action, it is not necessary for me to address this question.
Was DPW required to deduct pay from the employees stood down pursuant to s.474of the FW Act?
[113] It follows from my finding that employees were not engaged in industrial action that DPW was not required to deduct pay from the employees stood down pursuant to s.474 of the FW Act.
Was there a stoppage of work on Saturday 16 February 2019?
[114] DPW was issued with four prohibition notices by SafeWork NSW at 10.52pm on Saturday 16 February 2019. DPW considered that the legal effect of the prohibition notices was that they could not direct employees to work on the JPO Virgo until the prohibition notices were lifted. I agree. I note s.197 of the Work, Health and Safety Act 2011 (NSW).
[115] Adopting the approach taken in the Bristow Helicopters decision regarding a stoppage of work being "some event which involved work being consciously halted for some reason and ordinarily for some identified period of time", I consider that the prohibition orders stopped work on the JPO Virgo and this constituted a stoppage of work for the purposes of s.524(2)(c).
If so, was the stoppage of work for a cause for which DPW could not reasonably be held responsible?
[116] The MUA submitted that DPW had some responsibility for the stoppage of work.
[117] The MUA said that DPW could have sought to ascertain the condition of the vessel from the owners before it docked at the terminal, citing evidence from Ben Crosky.[97] It also said DPW could have reviewed the inspection report from Brisbane but did not.[98]
[118] The evidence was that the ship was worked in Brisbane without an issue and at good rates of productivity. Mark Hulme said that he did speak to colleagues in Brisbane prior to the vessel arriving in Sydney.[99]
[119] DPW said that the point really was that the prohibition notices stopped the work and DPW could not be reasonable held responsible for the actions of a third party.
[120] The reason for the stoppage of work from the night shift on Friday onwards was the issuance of the prohibition notices. It was a legal obligation of DPW to comply with the prohibition notices. I consider that the stoppage of work was for a cause for which DPW could not reasonably be held responsible.
If so, were the employees stood down unable to be usefully employed because of the stoppage of work?
[121] Some employees were able to be usefully employed. The MUA submitted that there was useful employment that those who were stood down could have done. Cleaning and housekeeping were put forward in this regard. Mark Hulme gave evidence that employees were directed to perform housekeeping duties on 15 and 16 February 2019 and could have been directed to perform cleaning duties on 15 and 16 February 2019.[100] Mark Hulme's evidence was that there was no housekeeping work available other than what was allocated to employees apart from "small little bits that could have been done on the Saturday evening, Saturday night, but given we had overmanned the machinery anyway, because we had extra people in the machines, there was no specific significant work that was allocated. It was done by those that were already in the machines."[101] To the extent that there was anything insignificant available in the way of housekeeping, Mark Hulme indicated it would not have been useful work.[102]
[122] Guided by the FMP decision,[103] it is necessary for there to be a causal relationship between the stoppage of work and the inability of the employees to be usefully employed. Guided by the McCain decision,[104] being usefully employed includes a consideration of the economic consequences to the employer.
[123] The work the employees were allocated for was the unloading of full containers from the JPO Virgo and the loading of empty contains onto the JPO Virgo. That work was stopped from 10.52 on Saturday night. The absence of this work meant that there was limited opportunity for the employees to be usefully employed. Employees on the day shift on Friday were deployed to another vessel. During evening and night shifts on Friday, and day and evening shifts on Saturday, some employees were deployed to alternative duties. From night shift on Saturday, employees were deployed to another vessel.
[124] In the circumstances I consider that DPW made a reasonable effort to deploy the employees affected by the stoppage of work.
[125] I consider that the employees stood down were unable to be usefully employed because of the stoppage of work.
Is the relief sought by the MUA beyond the power of the FWC to grant?
[126] The MUA submits that the FWC should answer the issues presented by the dispute as follows:
the Respondent was not able to stand down the employees detailed in the annexures to Mr Dunn's statement under any of the circumstances set out ss.526(1)(a)-(c) on 15-17 February 2019;
further and in addition, the employees were not capable of being stood down without pay because of clause 21.7 of the Agreement;
the Respondent was not permitted to refuse to pay employees for the times set out in the annexures to Mr Dunn's statement.
[127] The MUA submit that fairness between the parties requires that the Commission make orders resolving the dispute in terms similar to orders to the following effect:[105]
the Respondent pay to each employee who was stood down on 15-17 February 2019 the remuneration, including superannuation, the employee would have received for the hours for which they were not paid on those dates;
the Respondent make such payments within 28 days of the order;
the Respondent notify each employee as soon as practicable that any disciplinary sanction imposed on them in relation to the non-performance of work on 15-17 February 2019 be immediately removed from their disciplinary record and rescinded.
[128] In the face of the assertion that this relief is beyond the power of the FWC to grant, the MUA says:[106]
"The Applicant here does not seek a 'declaration' or a 'rectification' based on a failure to comply with s 524. Rather, it asks the Commission to resolve a dispute about Part 3-5 by creating a charter of rights which will operate prospectively having regard to matters of industrial fairness as between the parties.
It is not a necessary element of the Applicant's case that the Respondent has or has not complied with s 524. The Applicant contends that having regard to the factors at [68] and [70] of its reply submissions of 8 May 2020 and the mandatory consideration under s 524(4), industrial fairness as between the parties requires that the Commission resolve the dispute by making an arbitral award under s 526(2) that employees: (a) be paid an amount equivalent to or, if the Commission does not consider this fair in the circumstances, a fair amount proportionate to the amounts they were not paid during the stand down or which were otherwise deducted from their pay; and (b) that the Respondent be directed to remove warning letters issued to employees for purportedly taking unprotected industrial action."
[129] On the other hand, DPW says:[107]
"The Union's submission that granting this relief does not involve an exercise of judicial power because it would involve the creation of a "charter of rights", operating only prospectively in resolving the dispute, is nothing more than sophistry. If the employees were validly stood down, DP World was not obliged to pay them: s 524(3). The Union thus clearly seeks that the Commission vary and interfere with past rights.
No matter how the union attempts to cast the order which is sought in this case, in substance the relief sought is the same as in Bristow Helicopters and the XDL Decision; that is, that DP World be obligated to make payments of wages to employees for a period that they were stood down. That relief is plainly beyond power. The jurisdiction of the Commission in dealing with a dispute about stand down is limited to the making of orders about whether a stand down should be allowed to occur or continue, and ancillary matters that do not relate to the payment of wages.
[130] I have found that employees stood down on the evening shift on Friday 15 February 2019 were not engaged in industrial action. DPW was not obliged to deduct pay in accordance with s.474 of the FW Act. Neither was DPW entitled to deduct pay for this period in accordance with s.524(2)(c) of the FW Act.
[131] Guided by the Bristow decision I consider that to order payment of wages for this period would be an exercise of judicial power, and accordingly beyond the power of the FWC. I decline to order the remedy sought for these employees for this period. I recommend that DPW restore the lost wages, but I consider that to realise their rights other than by consent, the employees will need to take an enforcement action in a court of competent jurisdiction.
[132] I consider that it is not beyond the power of the Commission to order that the warning letters be removed from employees' human resource files and I will so order.
[133] I have found that employees stood down on the night shift on Friday 15 February 2019 and the day and evening shifts of Saturday 16 February 2019 were stood down in accordance with s.524(2)(a) of the FW Act. DPW was entitled to deduct pay from the employees concerned for this period.
What is an appropriate resolution of the dispute taking into account fairness between the parties?
[134] I consider that it is open to me to determine the dispute by creating future rights for employees affected by the dispute. In so doing I consider that I am obliged to take into account fairness between DPW and the employees affected.
[135] In considering fairness between DPW and the employees affected I take into account that employees attended for work as allocated for all the shifts upon which employees were stood down, and were never told that they did not need to attend or could go home.[108]
[136] Employees who were stood down on the night shift on Friday 15 February were already at work when the prohibition notices arrived. True it is that the prohibition notices applied retrospectively to 2pm that day but DPW had no forewarning of the prohibition notices. Once the stoppage of work occurred the employees were not told that they could leave the terminal.
[137] Mark Hulme gave evidence that once employees were allocated, the allocation could not be cancelled. He also gave evidence that Brad Dunn had said "we are not leaving". The evidence in relation to that statement is confined to the evening shift on Saturday when the employees were said to be engaged in industrial action.[109]
[138] By day shift and evening shift on Saturday the stoppage of work was well and truly in place. I asked Mr Hulme "Why did workers attend for work on those days when you knew that they weren't going to be able to work?". Mark Hulme replied:
"So we issue rosters for our employees, or work arrangements ... Nominally, Monday to Friday it's issued at 2 o'clock today for work starting from day shift tomorrow. For the weekends you issue those instructions on a Friday, so that covers all of the shifts across a Saturday and a Sunday. So those employees had already been rostered at about 2 o'clock on Friday afternoon and Mr Whatman's first advice to me at 5.30 of improvement notices, the employees for the weekend have already been engaged or told to come to work, and then the prohibition notices were issued late on the Friday evening. The employees were rostered to work. I don't have the facility under the enterprise agreement to cancel labour once it's been ordered. Once the orders have been released those employees are locked in, other than if they, you know, use personal leave to not attend a shift, as an example. So I couldn't cancel them."[110]
[139] I regard this response from Mark Hulme as inadequate. He knew at this point that workers would not be paid and yet he took no steps to alert them not to attend so they could use their time for personal purposes.
[140] Mark Hulme also said that he was "hopeful that we would get to work that vessel on the Saturday".[111]
[141] In the circumstances I consider that this was unfair to employees. Employees were not going to be paid. If employees are stood down and not being paid, they should not be required to remain at work, or attend work. It is no answer to say that it is at the employee's discretion.
[142] In all the circumstances and factoring in fairness as between the parties I consider that:
[143] I am confident that this remedy does not constitute an exercise of judicial power. In relation to the payment of monies to employees, this could not be an enforcement of a right when no right to payment existed prior to the issue of an order from the FWC in determination of this dispute.
[144] As indicated earlier in my decision the parties submitted that there was some uncertainty about which employees were stood down and when.[112] It was proposed by the MUA that I make my decision, and if a remedy was determined, I direct the parties to confer about the application of my decision to relevant employees.
[145] I direct the MUA and DPW to confer about which employees were stood down and when. Order/s sought are to be provided to the FWC in draft form by 5pm on Wednesday 23 September 2020. If by consent, and acceptable to me, the order/s will be issued without the need for further hearing. If there is no consent, and a hearing is required, the parties should advise my chambers and directions will be issued.
[1] Exhibit MUA11; Transcript 30 June 2020 PN1254.
[3] Applicant's Submission re [2020] FWC 4147 of 24 August 2020 at 3 and 22; Respondent's Submissions re [2020] FWC 4147 of 27 August 2020.
[4] Transcript of 13 July 2020 PN2987-2992.
[5] Exhibit DPW4 Statement of Mark Hulme of 4 April 2020 at 151 and Attachment MH20.
[10] Exhibit DPW4 Statement of Mark Hulme of 4 April 2020 at 21-24 and Attachment MH23.
[15] Exhibit MUA1 Statement of Michael Walsh at 15.
[16] Exhibit DPW1 Statement of Ben Crosky of 4 April 2020 at 27 and 40; Exhibit DPW4 Statement of Mark Hulme at11; PN2294 and PN221-222; PN245.
[17]Exhibit DPW2 Safety, Security and Environment Procedure for PBT Vessel Inspection.
[18] Transcript of 30 June 2020 PN224-226; PN246; Exhibit DPW1 Statement of Ben Crosky at 40-41, Exhibit DPW4 Statement of Mark Hulme at 12-15.
[19] Exhibit MUA1 Statement of Michael Walsh at 19 and Attachment MW2.
[22] Ibid at 15; Transcript of 30 June 2020 PN211.
[23] Exhibit MUA1 Statement of Michael Walsh at 16.
[25] Exhibit DPW1 Statement of Ben Crosky of 4 April 2020 at 56-57.
[26] Exhibit MUA1 Statement of Michael Walsh at 11-13.
[27] Exhibit MUA12 Extracts of the Notebook of SafeWork NSW Inspector Mr John Whatman.
[30] Exhibit MUA3 Statement of Brad Dunn of 4 March 2020 at 12.
[32] Exhibit MUA1 Statement of Michael Walsh at 34 and Attachment MW4.
[33] Exhibit MUA14 Notice of Deficiency.
[34] Exhibit MUA3 Statement of Brad Dunn of 4 March 2020 at 24 and Attachment BD3.
[35] Joint Chronology provided by the Applicant and the Respondent on 15 May 2020; Exhibit DPW1 Statement of Ben Crosky of 4 April 2020 at 48 and 54; Exhibit DPW4 Statement of Mark Hulme of 4 April 2020 at 35.
[36] Exhibit DPW4 Statement of Mark Hulme of 4 April 2020 at 21-24; Exhibit DPW1 Statement of Ben Crosky of 4 April 2020 at 54.
[37] Exhibit DPW4 Statement of Mark Hulme of 4 April 2020 at 8.
[39] Ibid at 106-110 and Attachments MH7 and MH8.
[43] Ibid at 55, Exhibit DPW1 Statement of Ben Crosky of 4 April 2020 at 107.
[44] Exhibit DPW4 Statement of Mark Hulme of 4 April 2020 at 134 and 145.
[45] Joint Chronology provided by the Applicant and the Respondent on 15 May 2020; Exhibit DPW4 Statement of Mark Hulme of 4 April 2020 at 39.
[46] Exhibit MUA3 Statement of Brad Dunn of 4 March 2020 at 24.
[47] Exhibit DPW4 Statement of Mark Hulme of 4 April 2020 at 51.
[48] Exhibit MUA10 Statement of Matthew Lewis of 4 March 2020 at 13-14; Exhibit MUA3 Statement of Brad Dunn of 4 March 2020 at 9.
[49]Exhibit MUA10 Statement of Matthew Lewis of 4 April 2020 at 23.
[50] Exhibit DPW4 Statement of Mark Hulme of 4 April 2020 at 62.
[56] Exhibit MUA1 Statement of Michael Walsh of 4 March 2020 at 36.
[58] Exhibit DPW1 Statement of Ben Crosky of 4 April 2020 at 91, 108 and 113; Exhibit DPW4 Statement of Mark Hulme at 72, 75-80, 82 and 83.
[59] Exhibit DPW1 Statement of Ben Crosky of 4 April 2020 at 85; Exhibit DPW4 Statement of Mark Hulme at 85.
[60] SafeWork NSW Prohibition Notices N5070-N5073, issued on Friday 15 February 2020.
[61] Exhibit DPW4 Statement of Mark Hulme of 4 April 2020 at 89-90 and Attachment MH26.
[68] 2017 FWCFB 487 at [36].
[69] Australian Federation of Air Pilots v Bristow Helicopters Australia Pty Ltd [2016] FWC 8515 at [62].
[73] [2011] FWA 6810 at 16.
[75] 2013 FWC 2554 at [31].
[80] Applicant's Outline of Submissions of 4 March 2020 at 18.
[81] Applicant's Submissions in Reply of 8 May 2020 at 2.
[82] Transcript of 13 July 2020 PN2535; PN2710-2711.
[84] Transcript of 31 July 2020 PN2708.
[85] Transcript of 31 July 2020 PN2711.
[86] Exhibit DPW4 Statement of Mark Hulme of 4 April 2020 at 23.
[87] Exhibit DPW1 Statement of Ben Crosky at 47.
[88] Exhibit MUA1 Statement of Michael Walsh at 49, 56 and 68.
[91] Transcript of 1 July 2020 PN2011; PN2013; PN2015; PN2158; PN2168; PN2170; PN2173-2174; PN2262; PN2279; PN2292; PN2294-2296; PN2305-2306; PN1504; PN1517.
[92] Exhibit MUA10 Statement of Matthew Lewis of 4 March 2020 at 22; Exhibit MUA3 Statement of Brad Dunn dated 4 March 2020 at 19.
[93] Exhibit DPW4 Statement of Mark Hulme at 72.
[94] Exhibit DPW1 Statement of Ben Crosky at 87.
[95] Exhibit DPW4 Statement of Mark Hulme at 68.
[96] Respondent's Outline of Submissions of 5 April 2020.
[97] Transcript of 1 July 2020 PN1408-1411.
[105] Applicant's Outline of Submissions of 4 March 2020 at 33-34.
[106] Applicant's Submissions re [2020] FWC 4147 of 24 August 2020 at 24-25.
[107] Respondent's Submissions re [2020] FWC 4147 27 August 2020 at 12 and at 16-17.
[108] Transcript of 1 July 2020 at PN1297.
[109] Exhibit DPW4 Statement of Mark Hulme at 73.
[110] Transcript of 1 July 2020 at PN1320-1321.
[112] Transcript of 13 July 2020 at PN2987-2992.
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Construction, Forestry, Maritime, Mining and Energy Union
DP World Sydney Limited [2020] FWC 4623