Construction, Forestry, Mining and Energy Union v Caelli Constructions

3 On the morning of 10 June 2009, Caelli through its Construction Manager, Guy Caelli, called a meeting of approximately 220 Caelli employees at the site of the Royal Childrens' Hospital Project ("the Hospital site") on which Caelli is presently engaged as a contractor. The following account of what then occurred has been given by Caelli's Occupational Health & Safety Manager, Mark Keith Watson, in an affidavit sworn 16 June 2009. Mr Watson was in attendance at the meeting. '6. Guy Caelli addressed the Caelli Employees on site and explained to them using words to the effect of: "Caelli Constructions are proposing an Employee Collective Agreement and we have copies available for you and a document that shows the difference between the pattern agreement the CFMEU want Caelli to sign, and the proposed Caelli agreement."

During this meeting Guy outlined details of the Caelli Constructions (Vic) Pty Ltd Employee Collective Agreement 2009-2012 (Caelli Employee Agreement) and how the clauses differed to the proposed 2008-2011 Union Collective Agreement (CFMEU Agreement).

During part of his presentation to the employees at the site, Guy specifically explained some of the key differences between the pattern agreement the CFMEU had wanted us to sign, and the proposed Caelli Employee Agreement.

After my involvement described in the following paragraphs 10 - 14, Guy asked words to the effect of: "Does anyone have any questions?" But immediately after Guy had spoken about our proposed Agreement, I addressed the employees and indicated to them that the proposed Employee Collective Agreement was available for them on site in the form of a hard copy and also on our Company website. I also confirmed that the site office also had copies of the Agreement for employees to view or take home.

I also stated to employees that a cover letter was attached to the front page of the Information Statement for Employees and was available for them on site in the form of a hard copy and also on our Company website. I explained that the letter expressed how and where to access the information provided to them, and that the Information Statement for Employees that was stapled to the cover letter detailed Caelli Constructions' proposal for voting on their approval or disapproval of the proposed Caelli Employee Collective Agreement, as well as information on Collective agreements by the Australian Government Workplace Authority.

I also told them that Caelli Constructions had prepared a document that identified each clause in the Caelli Employee Agreement where it was different as compared with the CFMEU Agreement. I advised employees that this document was available for them on site in the form of a hard copy and also on our Company website.

I also told them we had a copy available of the proposed Caelli Employee Agreement.

I also told them we had generated a copy of the relevant clauses in the National Building and Construction Industry Award that were incorporated into the proposed Caelli Employee Collective Agreement.

After making the employees aware of the documents referred to above, I then confirmed that all employees would be asked to vote on this Caelli Employee Collective Agreement.

Upon completion of this discussion and after Guy had answered any questions that the employees had, I made everyone aware that I had available copies of the documents referred to above for the employees to view and/or take home.

The site administrator, Bruno Ferrara, and I then proceeded to hand out copies of all of the documents referred to above.

After Guy's invitation for questions, I recall that there were only two questions.'

4 Similar meetings were later held of Caelli employees at the 717 Bourke Street, Myer, ANZ and Merchant sites later on 10 June 2009 and on the next day, 11 June 2009, at the a'Beckett site Tower and Olsen sites and at Caelli's yard at 320 Hume Highway, Craigieburn. Also on Thursday 11 June 2009, each Caelli employee who had been absent on annual or sick leave from one or other of the meetings described above was sent by courier a bundle of the documents described by Mr Watson. On Saturday, 13 June 2009, Mr Watson sent the following message to each of nine Caelli site foremen; 'Important. All site foreman, Members of the union have been circulating rumours to Caelli employees that the coming vote for the Caelli agreement on Thursday has been cancelled. THIS IS NOT TRUE. It is imperative that all employees are told (and recorded of told) that this NOT TRUE. Please convey these EXACT WORDS to all of the Caelli employees immediately; "THE UNION HAVE ONLY APPLIED TO HAVE THE VOTE FOR THE CAELLI AGREEMENT CANCELLED. CURRENTLY BOTH THE UNION INDUSTRIAL ACTION SECRET BALLOT, AND THE CAELLI AGREEMENT VOTE WILL PROCEED AS ORGANISED. ITS UP TO YOU BUT CAELLI WOULD LIKE YOU TO VOTE "NO" TO THE INDUSTRIAL ACTION SECRET BALLOT, AND "YES" TO THE CAELLI AGREEMENT. If unclear please call me.' 5 Mr Watson further deposed that at 3.02 pm on 13 June 2009 he caused to be sent to Caelli supervisors and management a notice to employees "clarifying the difference between the two ballots taking place at different times." That notice was under a Caelli letterhead, and, according to Mr Watson's information and belief, has been posted at each Caelli site in the usual locations for the posting of employer notices. It recited: 'We confirm that the CFMEU still seeks a "union collective agreement" with Caelli.

A secret ballot is being conducted by the Australian Electoral Commission (AEC). The ballot being sent to you by the AEC is about whether you are for or against taking "Protected Industrial Action" against Caelli in support of a 'Union Collective Agreement'.

Caelli's appeal in the Australian Industrial Relations Commission on Friday the 12th to stop the secret ballot failed. So the secret ballot about taking protected industrial action against Caelli is proceeding.

You will receive information in the mail from the AEC.

THIS DOES NOT CHANGE THE VOTING FOR THE PROPOSED CAELLI COLLECTIVE EMPLOYEE AGREEMENT THIS THURS 18th and FRI 19th JUNE.

Caelli is still seeking a non-union collective "Employee Agreement". On the 10th and 11th of June you received documents about the proposed collective "Employee Agreement".

On the 18th and 19th of June you can vote 'for or 'against' the proposed Caelli non-union collective "Employee Agreement".

IT IS UP TO YOU, BUT CAELLI CONSTRUCTIONS WOULD LIKE YOU TO VOTE "NO" IN THE INDUSTRIAL ACTION SECRET BALLOT THAT YOU WILL GET IN THE MAIL, AND "YES" IN THE CAELLI COLLECTIVE EMPLOYEE AGREEMENT VOTE THIS THURSDAY AND FRIDAY.'

6 Mr Guy Caelli, in an affidavit sworn 15 June 2009, has explained in these terms Caelli's decision to allow Caelli's employees to decide by vote whether to approve an employee collective agreement proposed by Caelli; '22 Given the failure of the parties to reach agreement, the Company decided to attempt to get majority support for an employee collective agreement (Caelli Agreement). The Caelli Agreement has been based on the CFMEU Agreement with adjustments in the overall interests of the Company and the employees. The key differences between the CFMEU Agreement and the Caelli Agreement were summarised into a document that was provided to employees with the Caelli Agreement.' 7 The summary to which Mr Caelli referred in that paragraph is a four page document identifying the differences between what is called the "Caelli version", being the employee collective agreement proposed by Caelli, and what is called the "Pattern Version", being the union collective agreement proposed by the CFMEU. In some instances the differences are in terminology or nomenclature or go to formal matters such as the identification of the parties bound. The quantum of the wage increase provided by each document is similar, as is the provision for fares and travelling allowance and the level of employer superannuation contributions. The major differences of substance appear to concern the period in respect of which accident pay is payable and the administration of the Rostered Day Off and funding for training. A copy of that summary was among the material made available to Caelli employees as described in par 6 of Mr Watson's affidavit reproduced at [3] above. That material also included the full text of the employee collective agreement proposed by Caelli which, with Appendices A-K, extends over some 86 pages. 8 On 12 June 2009, Caelli applied to the Commission for a stay pending appeal of Watson SDP's order of 4 June 2009. On the same day, 12 June 2009, the President, Giudice J, refused a stay. 9 As well as the material already made available to Caelli employees, Mr Watson has further deposed that by 9.00 am on 16 June 2009 an "additional document" was to be "available on the Caelli website to be read and downloaded." As I understand it, that document was to be in the same format as the summary of the differences between the "Caelli version" and the "Pattern Version" described at [7] above but was to show the differences between the Caelli version and the 2005 Agreement. Mr Watson explained the provision of that additional information by deposing; 'I have not been asked any questions or heard any comments from any employee, suggesting any confusion about these differences. I have prepared it out of an abundance of caution and to provide such information to any employee who may want it.' 10 On 12 June 2009 the CFMEU filed an application in this Court seeking, pursuant to s 39B(1A)(c) of the Judiciary Act 1903 (Cth) ("the Judiciary Act"), ss 21, 22 and 23 of the Federal Court of Australia Act 1976 (Cth) and the inherent jurisdiction of the Court, the following relief; '1. A declaration that the Respondent has not given all persons employed by it and who are entitled under s.340 of the Workplace Relations Act 1996 (Cth) ("the Act") to decide whether they want to approve the proposed Caelli Constructions (Vic) Pty Ltd Employee Collective Agreement 2009 - 2012 ("the Agreement"), a reasonable opportunity to so decide, within the meaning of s 340(2)(a) of the Act.

2. A declaration that the proposed vote for the approval of the Agreement which is to take place on 18 and 19 June 2009 ("the Vote"), is null and void and of no effect as an approval of Agreement under s 340(2) of the Act.

3. An order that the Respondent, by itself, its servants or agents, refrain from in any way, directly or indirectly, treating the Vote as a valid decision to approve the Agreement in accordance with s 340(2) of the Act.

4. An order that the Respondent, by itself, its servants or agents, refrain from lodging the Agreement with the Workplace Authority Director under s.344 of the Act.

5. An order that the Respondent, by itself, its servants or agents, refrain from conducting the Vote until a date no earlier than 30 June 2009.'

11 On 16 June 2009, the CFMEU moved for interlocutory relief expressed as; '1. An order that until the determination of this Application, 30 June 2009 or further order, whichever is the earlier, the Respondent, by itself, its servants or agents, refrain from conducting the Vote.

2. An order that until the determination of this Application or further order, the Respondent, by itself, its servants or agents, refrain from in any way, directly or indirectly, treating the Vote as a decision to approve the Agreement in accordance with s. 340(2) of the Act.

3. An order that until the determination of this Application or further order, the Respondent, by itself, its servants or agents, refrain from lodging the Agreement with the Workplace Authority Director under s.344 of the Act.'

12 Mr O'Grady of Counsel who appeared with Mr Snaden of Counsel for Caelli opposed the grant of any interlocutory relief by contending, first, that the CFMEU lacks standing to apply for the relief sought. He contended that only defined classes of persons and organisations may apply to this Court for an order under Division 11 of Part 8 of the Act in relation to a workplace agreement. Because the employee collective agreement proposed by Caelli is not expressed to be binding on the CFMEU, that organisation has no standing to apply for an order under Division 11 in relation to the proposed agreement unless requested by an employee who is or will be bound by the proposed agreement to apply on his or her behalf; see sub-ss 405(1) and 405(3) of the Act. 13 However, the substantive application to this Court does not purport to be made under Division 11 of Part 8 of the Act. It is made under s 39B(1A)(c) of the Judiciary Act as to which a Full Court of this Court said in Transport Workers Union v Lee (1998) 84 FCR 60, at 66-67; 'The claim made by the applicants in the proceeding in this Court is that by reason of the provisions of a law made by the Parliament, namely s 170MT(2) of the Workplace Relations Act, they are immune from the proceedings brought against them under the law of Queensland in the Industrial Magistrates' Court at Kingaroy. They also claim that the same provision gives them a right to make application to the Federal Court not to be subjected to an action which, by reason of federal law, does not lie. They claim that on its true construction s 170MT(2) operates as an immunity, or a bar to proceedings, rather than as a mere defence. The right for which they primarily contend is a right not to be subjected to a prosecution in respect of protected action but they say, in the alternative, that s 170MT(2) is available by way of defence.

In our view the applicants are correct in their submission that the Court does have jurisdiction to hear and determine their claim. That claim is a matter arising under a law made by the Parliament, in this case the Workplace Relations Act, because it is necessary for the Court to determine whether that law confers the rights which the applicants claim in this proceeding. There being a matter before the Court arising under a law made by the Parliament, the Court has jurisdiction derived from s 39B(1A)(c) to determine the controversy between the parties.'

14 In the same case the Full Court earlier in its reasons had invoked the following frequently cited passage from the judgment of Latham CJ in R v Commonwealth Court of Conciliation and Arbitration; Ex parte Barrett v Opitz (1945) 70 CLR 141, at 154; 'A matter may properly be said to arise under a Federal law if the right or duty in question owes its existence to Federal law or depends upon Federal law for its enforcement, whether or not the determination of the controversy involves the interpretation (or validity) of the law. In either of these cases, the matter arises under the Federal law. If a right claimed is conferred by or under a Federal statute, the claim arises under the statute.' 15 The claim made by the CFMEU in the present proceedings is that it has a right to require that any vote on whether to approve an employee collective agreement be conducted in accordance with s 340(2) of the Act and a further right to require that a protected action ballot pursuant to an order of the Commission be conducted in accordance with Division 4 of Part 9 of the Act. In the terms used by the Full Court in Lee (supra), those claims are matters arising under the Act because it will be necessary for the Court to determine whether some provision of the Act confers one or other of the rights which the CFMEU claims. For example, s 340(2) of the Act provides; 'An employee collective agreement or union collective agreement is approved if:

(a) the employer has given all of the persons employed at the time whose employment will, or would but for the operation of an ITEA that has passed its nominal expiry date, be subject to the agreement a reasonable opportunity to decide whether they want to approve the agreement; and

(i) if the decision is made by a vote - a majority of those persons who cast a valid vote decide that they want to approve the agreement; or

(ii) otherwise - a majority of those persons decide that they want to approve the agreement.'

16 One of the rights asserted by the CFMEU to be conferred on it by that sub-section is to require the employer to give persons whose employment will be subject to the proposed agreement, including members of the CFMEU, a reasonable opportunity to decide whether they want to approve the agreement. 17 It was also contended on behalf of Caelli that there is no evidence that any Caelli employees are members of the CFMEU or that the CFMEU is entitled under its eligibility rules to represent any Caelli employees. However, the evidence discloses that there were protracted hearings in the Commission on the CFMEU's application for an order for a protected action ballot. Despite Caelli's strenuous opposition to the making of such an order, at no point in those proceedings does it appear that any argument was advanced that the CFMEU had no members among the Caelli workforce. Section 467(1) of the Act provides; 'A person is eligible to be included on the roll of voters for the ballot if, and only if:

(a) if the applicant is an organisation of employees - the person:

(i) was a member of the organisation on the day the ballot order was made; and

(ii) was employed by the employer on the day the ballot order was made; and

(iii) will, or would but for the operation of an ITEA that has passed its nominal expiry date, be subject to the proposed collective agreement; or

(b) if the applicant is an employee, or a group of employees - the person:

(i) was employed by the employer on the day the ballot order was made; and

(ii) will, or would but for the operation of an ITEA that has passed its nominal expiry date, be subject to the proposed collective agreement.'

18 It follows that if, on 4 June 2009, the CFMEU had no members among the Caelli workforce, Watson SDP's order for a protected action ballot would have been futile. Moreover, the learned Senior Deputy President made the following finding of fact at [8] of his reasons; 'The following factual background can be established by the evidence brought by the parties and documentary materials relied upon by them.

1. Caelli has been party to a series of collective agreements with the CFMEU which were drafted without input from Caelli as an individual business, with common terms and conditions to a large number of agreements with other employers in the building and construction industry. [Exhibit Caelli 3, para 4] These agreements were agreed between the CFMEU and the MBAV. [Exhibit Caelli 3, para 5]'

19 Accordingly, I infer on the present state of the evidence that the CFMEU has members who are employees of Caelli and that at least some of those employees are eligible for membership of the CFMEU. 20 I am satisfied that there are serious questions to be tried on a final hearing of the present application as to whether the Act confers on the CFMEU the rights asserted by it as described at [15] above and as to whether Caelli's employees have had a reasonable opportunity within the meaning of s 340(2) of the Act to decide whether they want to approve the employee collective agreement proposed by Caelli. The reasonableness of such an opportunity can be affected or diminished by circumstances which have "the capacity to distract [an employee] from voting on the agreement and from considering its actual effect"; see Shop Distributive and Allied Employees' Association v Karellas Investments Pty Ltd (2008) 166 FCR 562, at 577 [54]. Allied to the latter question is a subsidiary question of the effect on employees of the conduct of a vote under s 340(2) which overlaps with the period specified for the conduct of the protected action postal ballot ordered by the Commission. 21 If the CFMEU were to succeed at trial on any of the serious questions which I have just identified, there could be no suggestion that damages would afford it adequate relief. I turn therefore to the balance of convenience. 22 I consider that the balance of convenience is heavily in favour of restraining the conduct of a vote on the employee collective agreement for a short but clearly defined period after the completion of the protected action ballot. That is because it would be extremely difficult, after the event, for the CFMEU to identify which employees had been denied by the coincidence of the ballot and the vote a reasonable opportunity to decide whether to approve the employee collective agreement or what effect the denial had on the making of that decision. Similar considerations apply to proof of the effect of these circumstances on the protected action ballot. 23 On the other hand, the inconvenience to Caelli of a delay for a short defined period in the conduct of a vote as to whether its proposed employee collective agreement should be approved will be insignificant. I have been informed from the Bar table that Caelli has already made arrangements to postpone that vote from Thursday 18 and Friday 19 June to Friday 19 and Monday 22 June 2009. That is to ensure that employees who were notified of the vote on 11 June are allowed the minimum period stipulated by sub-ss 337(1) and (2) of the Act for consideration of the employee collective agreement before voting on whether it should be approved. Sub-sections 337(1) and (2) provide; '(1) If an employer intends to have a workplace agreement (other than a greenfields agreement) approved under section 340, the employer must take reasonable steps to ensure that all eligible employees in relation to the agreement either have, or have ready access to, the agreement in writing during the period:

(a) beginning 7 days before the agreement is approved; and

(2) The employer must take reasonable steps to ensure that all eligible employees in relation to the agreement are given an information statement at least 7 days before the agreement is approved.'

24 In these circumstances, I regard further delay in the conduct by Caelli of the proposed vote to 30 June 2009 or shortly thereafter as unlikely to occasion any real inconvenience to Caelli or its employees. This is not a case like Community and Public Sector Union v Telstra Corporation Ltd (2000) 108 FCR 52 where an open-ended injunction "pending the hearing and determination of the application" was sought to restrain the employer from taking any step to hold a ballot of its employees in respect of proposed industrial agreements. In that case it was indicated, at 64 [33], that the Court would have exercised its discretion; '… adversely to the applicant for injunctive relief because of the detrimental impact which the consequential delay in the certification of the agreements (if they are to be certified) would have on Telstra, the other unions party to the agreements and the employees who stand to derive significant salary increases immediately upon certification. As well, an opportunity for protected industrial action would arise if there were any significant hiatus between the expiration of the 1998 Agreement and the certification of the new agreements. Whether viewed singly or in combination, these are not matters against which Telstra, or its employees or the other unions could adequately be protected by an undertaking as to damages extracted from the CPSU.' 25 By contrast, because the CFMEU has chosen to limit the interlocutory restraint which it seeks to a period ending on 30 June 2009 there will be scarcely any detrimental effect on Caelli or its employees if the proposed employee collective agreement is approved shortly after that period. For this reason, I have declined to require from the CFMEU the usual undertaking as to damages. 26 I am conscious that the injunction which I propose to grant may, in a practical sense, give to the CFMEU all the relief which it seeks. However, I do not regard that feature of the case as requiring the imposition of a stricter test when exercising the Court's discretion to grant or withhold discretionary relief. As Sundberg J observed in Conquo v Jackson [2009] FCA 45 at [31]; 'The Court of Appeal [Bradto Pty Ltd v State of Victoria (2006) 15 VR 65] also rejected a contention that where an interlocutory injunction is tantamount to awarding final relief, it should be granted only if the court feels a high degree of assurance that at trial it will appear that the interlocutory injunction was rightly granted. The Court said at [39]:

Once again, we see no necessity for the recognition of a special "rule" for this - different - subcategory of interlocutory injunctions. On the contrary, we think that it must be relevant on every application for an interlocutory injunction to consider the likelihood of the plaintiff succeeding at trial. Not only is such consideration a necessary part of deciding whether there is a serious question to be tried, but the plaintiff's prospects of success will almost certainly be a factor in the evaluation of the balance of convenience.'

27 Moreover, it will remain open to Caelli at trial, after the interlocutory injunction has expired, to demonstrate that all its employees, or a sufficient majority of them, had a reasonable opportunity to decide whether they wanted to approve the employee collective agreement. Similarly, if it is still a live issue at trial, Caelli can seek to persuade the Court that its conduct in relation to the employee collective agreement had no impact on the integrity of the protected action ballot. 28 I have also been influenced to exercise my discretion in favour of interlocutory relief by the consideration that Caelli could have obtained directions from the Commission as to how the conduct of a vote on the proposed employee collective agreement could occur in conjunction with the protected action ballot which the Commission had ordered. In his reasons explaining why he had ordered that ballot to be conducted by post rather than as an "attendance ballot" Watson SDP observed, at 38; 'I note that Caelli gave an undertaking [transcript at para 1324] that in the event a postal ballot were ordered, it would refrain from distributing any further documents to its employees at their home addresses until the ballot was concluded. I would expect this undertaking to be given full effect. The determinative matter in my mind, given the efficiency and expedition criteria within s.463(2) of the Act, is the logistical problem of conducting attendance ballots across a range of sites on which the relevant employees work. Even if an attendance ballot could be conducted at a single place at a single time in respect of the five sites in the Docklands precinct, and mobile crane employees are not subject to the proposed ballot, the multiple sites would require either a larger than normal Australian Electoral Commission team or the conduct of the ballot by a smaller team over a number of days. In these circumstances, I am not satisfied that an attendance ballot is more efficient and expeditious than a postal ballot. Finally, I am satisfied that a postal ballot meets the objective of Division 4 of Part 9 of the Act of providing a means of a fair and democratic secret ballot.' 29 Mr O'Grady, who also appeared as Counsel for Caelli in the Commission, pointed out that the undertaking to which the learned Senior Deputy President referred had not been given in precisely the terms indicated in the passage just quoted. Rather, in referring to a survey which Caelli had distributed, Mr O'Grady had said; 'But if your Honour had concerns in respect of that document I can indicate that my client will undertake not to circulate further material in respect of the ballot to its employees via mail until the ballot is conducted.' 30 It was emphasised that the undertaking was not to circulate further material "in respect of the ballot", ie, the protected action ballot and not to do so "via mail". Because the material made available by Caelli since 4 June has been distributed at meetings of employees or by courier and has not been "in respect of" the protected action ballot but was directed to the proposed employee collective agreement, it was contended that there has been no breach of the undertaking. That seems to me to be a matter of interpretation of the undertaking and the material distributed to Caelli employees, which it is unnecessary for me to resolve. However, the fact remains that, neither before Watson SDP, or on the stay application to the President, did Caelli disclose its intention to conduct a vote on an employee collective agreement before, as I infer, the close of the protected action ballot. That lack of candour, I consider, has laid it open to the present application, including the claim for interlocutory relief, whereas had it disclosed its intentions, the matters in issue could have been resolved expeditiously and appropriately by the Commission.

Conclusion 31 For the reasons which I have endeavoured to explain, I shall order that Caelli by its servants and agents refrain until after 29 June 2009 or further order from conducting a vote in accordance with s 340(2) of the Act in relation to an employee collective agreement. 32 I regard it as inappropriate or unnecessary to impose any further restraint on Caelli in relation to treating any vote taken after 29 June 2009 as approving the relevant employee agreement or to prevent the lodgement under s 344 of the Act of any agreement so approved. I shall order that there be a directions hearing in the substantive action on a date to be fixed being a date not before 30 June 2009. I certify that the preceding thirty-two (32) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Ryan.

Associate: Dated: 18 June 2009 Counsel for the Applicant: Mr H C Borenstein SC with Mr C W Dowling

Counsel for the Respondent: Mr C O'Grady with Mr J L Snaden