Association of Professional Engineers, Scientists and Managers, Australia, The-New South Wales Branch

Australian Institute of Marine and Power Engineers, The

Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers' Union (AMWU)

New South Wales Local Government, Clerical, Administrative, Energy, Airlines and Utilities Union

Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia

Proposed protected action ballot by employees of Macquarie Generation.

[1] The Construction, Forestry, Mining and Energy Union - Construction and General Division (CFMEU), The Association of Professional Engineers, Scientists and Managers, Australia - New South Wales Branch (APESMA), The Australian Institute of Marine and Power Engineers (AIMPE), the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (AMWU), the New South Wales Local Government, Clerical, Administrative, Energy, Airlines and Utilities Union (USU), CPSU, the Community and Public Sector Union (CPSU) and Communications and the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) have made applications under s.437 of the Fair Work Act 2009 (the Act) for protected action ballot orders relating to employees of Macquarie Generation (the respondent). These applications were heard together on 3 September 2012.

[2] Macquarie Generation is a NSW State Owned Corporation which owns and operates the Bayswater and Liddell power stations. It produces up to around 40% of the electricity used in NSW each year (equivalent to around 13% of the electricity used in the Eastern States).

[3] Under s.443 of the Act FWA must make a protected action ballot order if the requirements contained in subsection 443(1) are met. I am satisfied that those requirements are met in relation to each of the applications and protected action ballot orders will be issued.

[4] At the hearing the respondent made an application that FWA use its power under s.443(5) to extend the period of written notice referred to in s.414(2) of the Act to seven working days. Section 443 (5) states:

'(5) If FWA is satisfied, in relation to the proposed industrial action that is the subject of the protected action ballot, that there are exceptional circumstances justifying the period of written notice referred to in paragraph 414(2)(a) being longer than 3 working days, the protected action ballot order may specify a longer period of up to 7 working days.'

[5] Section 414 relevantly provides:

(1) Before a person engages in employee claim action for a proposed enterprise agreement, a bargaining representative of an employee who will be covered by the agreement must give written notice of the action to the employer of the employee.

(b) if a protected action ballot order for the employee claim action specifies a longer period of notice for the purposes of this paragraph - that period of notice.

Notice of employee claim action not to be given until ballot results declared

(3) A notice under subsection (1) must not be given until after the results of the protected action ballot for the employee claim action have been declared.

(6) A notice given under this section must specify the nature of the action and the day on which it will start.'

[6] The question I need to determine is whether there are exceptional circumstances justifying the period of written notice referred to in s.414(2) being increased from three to seven working days.

[7] Evidence was given on behalf of the respondent by the Acting General Manager Operations, Mr Colin Duck. Mr Duck has 26 years experience as an engineer in the power industry, and I am satisfied that he has a sound knowledge of the operations of power stations in general, as well as those operated by the respondent.

[8] Evidence was given on behalf of the CFMEU by Andrew Arnott, a Senior Generation Controller employed by the respondent.

[9] Mr Duck's evidence was that the proposed industrial action could mean that the respondent would be required to shut down some or all of the eight base load steam turbine generator units that it operates. There are strict safety requirements involved in relation to running the units and ensuring that there are people with the appropriate qualifications to monitor a safe shutdown. Industrial action could mean a complete absence of qualified employees capable of monitoring the units.

[10] Mr Duck gave evidence that, in his experience, a period of at least seven days could be necessary to safely shut down a unit. Units would need to be monitored during the shut down process to avoid damage to the turbine and to minimise the risk of fires or explosions. Mr Arnott by contrast denied that the respondent would need at least seven working days to shut down a unit. Instead he suggested a period of 30 hours would be sufficient.

[11] Mr Duck also gave evidence concerning the potential impact of a shut down on the operations of the National Electricity Market (NEM). The Australian Energy Market Operator (AEMO) is responsible for managing the NEM. Providing AEMO with as much notice as possible of any interruptions to supply would increase AEMO's ability to make arrangements with other energy providers, thereby reducing the likelihood of blackouts.

[12] Mr Arnott's evidence on this issue was that there is enough surplus energy capacity on the grid to maintain current energy requirements and prevent the disruption of energy supply to customers.

[13] I am satisfied that there are exceptional circumstances justifying an increase in the period of written notice that the applicants would need to give the respondent in accordance with s.414 of the Act.

[14] The proposed industrial action could mean that the respondent would need to shut down one or more of its turbine generator units. While there was some debate before me about how long it takes to shut down a unit it is clear that the process involved is complex and takes some considerable time. There are risks to safety both of the equipment and the staff. Increasing the period of notice that the applicants must give the respondent of their intention to take industrial action would minimise those risks.

[15] In addition, the respondent is responsible for producing a very large proportion of all the electricity used in New South Wales. Any significant industrial action would almost certainly reduce the amount of electricity the respondent contributes to the NEM. There would be a risk of power blackouts. Giving AEMO the maximum notice possible of any industrial action would assist in managing this risk.

[16] These two considerations, particularly in combination, amount to circumstances that are exceptional. Accordingly, I have decided to exercise my discretion to increase the period of written notice required prior to taking industrial action to seven days.

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