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[2017] FWC 4062
General information, not legal advice.
Fair Work Commission
2017-10-11
Deputy President Dean, President Dean
Original judgment source is linked above.
s.739 - Application to deal with a dispute
Construction, Forestry, Mining and Energy Union
Application to deal with a dispute about matters arising under the enterprise agreement.
[1] On 4 August 2016 the Construction, Forestry, Mining and Energy Union (CFMEU) filed an application pursuant to s.739 of the Fair Work Act 2009 (the Act) for the Fair Work Commission (the Commission) to deal with a dispute with Dendrobium Coal Pty Ltd (Dendrobium). The application was made in accordance with clause 6 (Issues Resolution Procedure) of the Dendrobium Mine Enterprise Agreement 2015 (the Agreement). The nominal expiry date of the Agreement is 30 September 2018.
[2] The application was the subject of a conciliation conference before me on 11 August 2016 and 13 September 2016.
[3] The dispute was not resolved by way of conciliation and the application proceeded to a hearing on 1 August 2017, with Mr A Walkaden appearing on behalf of the CFMEU, and Mr B Rauf of Counsel appearing on behalf of Dendrobium.
[4] At the commencement of the hearing Dendrobium raised a number of concerns in relation to the matter proceeding to arbitration. Specifically, Dendrobium raised objections in relation to the jurisdiction of the Commission and to the utility of proceeding to a determination on the ground that it had agreed to the relief sought by the CFMEU and thereby the dispute no longer exists.
[5] This decision concerns whether there is in fact a live dispute between the parties and whether the Commission has jurisdiction to arbitrate.
[6] The CFMEU's application to the Commission, dated 4 August 2016, described the matter in dispute as relating to the taking of personal leave by two CFMEU members, Mr Lee Finnerty and Mr Aaron Hertsch.
[7] On 7 June 2017, the CFMEU advised the Commission that they were no longer pursuing the application insofar as it related to Mr Herstch.
[8] The dispute was therefore narrowed to deal with the personal leave entitlement of Mr Finnerty, CFMEU member and employee of Dendrobium, arising out of clause 13 of the Agreement.
[9] The CFMEU's application for the Commission to deal with the dispute set out the circumstances relating to Mr Finnerty's claim that he was not provided with paid personal/carer's leave in relation to absences during eight shifts in the period from 16 November 2015 to 26 November 2015.
[10] The application described the relief sought by the CFMEU in the following terms:
'The CFMEU seeks that a conciliation conference be convened to resolve this dispute. If the dispute cannot be resolved, the CFMEU seeks that the Fair Work Commission arbitrate the dispute and issue an Order in these terms:
[11] The relief sought in paragraph 10 above was confirmed by the CFMEU as being the primary remedy to the application in its outline of submissions dated 23 May 2017. In addition to this remedy, the CFMEU also stated:
'48. In the alternate, it is further submitted that the respondent failed to thoroughly investigate the reasons for the absences as required by clause 13.5 of the Agreement. For the reasons set out above (see paragraphs 27 & 29), the effect of clause 13.5 is that the failure to take such action meant that the respondent was unable to determine that the 8 Shifts should be unpaid.
49. Again in the alternate, it is evident that the respondent was satisfied with the medical documentation produced by Mr Finnerty in relation to the 8 Shifts (see paragraph 39 above). For the reasons set out above (see paragraphs 27 - 29), the effect of clause 13.5 is that the respondent was unable to determine that the 8 Shifts should be unpaid.'
[12] In the CFMEU's outline of submissions in reply dated 14 July 2017, the CFMEU amended the relief sought to the following:
'Lee Finnerty was entitled to receive paid Personal leave for 6 of the 8 shifts that he was absent in the period from 16 November 2015 to 26 November 2015.'
[13] On 31 July 2017, Dendrobium advised the CFMEU that Dendrobium will agree to the primary remedy sought in the application, on a without admissions basis, and make a payment to Mr Finnerty for the six of the eight shifts during the relevant period, in the interests of resolving the matter currently before the Commission. Dendrobium also advised:
'To the extent that the CFMEU contends that there is an underlying issue about the interpretation of clause 13 of the Dendrobium EA, such a broader question does not relate to an ongoing dispute and is different to the matter which was pursued through the Issues Resolution Procedure and notified under the present application. Further, the relief which may be sought amounts, in our view, to no more than a declaration of existing rights which impermissibly invites the FWC to exercise judicial power. In this regard, we refer to the Full Bench decision of the FWC in Construction, Forestry, Mining and Energy Union v BHP Billiton Nickel West Pty Ltd [2017] FWCFB 217.'
[14] Despite Dendrobium agreeing to resolve the matter and to pay Mr Finnerty in accordance with the primary remedy sought, the CFMEU wished to proceed with the hearing on 1 August 2017.
[15] During the hearing, the CFMEU made oral submissions that it now seeks a determination in the following terms:
'1. The period in clause 13.2 is a continuous period and not a cumulative period;
2. Clause 13 provides for one review process of paid personal carer's leave, not two;
3. An excessive amount of paid personal leave within the meaning of clause 13.5 of the agreement, refers to taking of a greater period of paid personal leave than the period provided by clause 13.2 of the agreement.'[1]
[16] The CFMEU made oral submissions that these are live issues between the parties and Dendrobium's payment to Mr Finnerty of his entitlement for the period 16 November 2015 to 26 November 2015 does not resolve these issues.
[17] Dendrobium on the other hand contended that the matter in dispute, as notified in the application, cannot be properly pursued, as it has not only changed in significant respects, but the relief sought has also evolved substantially.
[18] The CFMEU made oral submissions as to why this matter in its current form should proceed to arbitration. Directions were then made for Dendrobium to file written submissions in reply by 3 August 2017 and for the CFMEU to file anything further in response by 7 August 2017.
[19] Clause 6 of the Agreement sets out the steps to be followed when a dispute arises:
6.1 It is the intent of the Parties to this Agreement that as far as is practical, issues be resolved at the work group level.
6.2 In the event of any dispute about matters arising under this Agreement or in relation to the National Employment Standards this procedure will apply, except in relation to disputes concerning refusal of flexible working arrangements or extension to Parental Leave under sections 65(5) and 76(4) of the FW Act. Whilst this procedure is being progressed, there shall not be any stoppage of work either by the Company or any Employee(s). If the dispute cannot be settled at the work group level, it shall be processed in accordance with sub-clause 6.3.
An Employee(s) may nominate a representative of their choice for any of the steps below.
Step 1: If an issue arises the matter shall in the first instance be discussed between the Employee(s) and the Employee(s) Shift Undermanager or their equivalent Supervisor that is one (1) level above the Senior Technician level.
Step 2: It may be referred for discussion between the Employee(s) and the appropriate Department Manager. If the matter remains unresolved;
Step 3: It may be referred in writing for discussion between the Employee(s) and the General Manager (or representative).
Step 4: The matter may be referred by the Employee(s) for discussion between the Employee(s), the
General Manager (or representative) and if the Employee(s) so choose, a nominated representative of their choice.
It may be referred by either party to FWC to be dealt with in accordance with the following provisions of this Clause.
Upon referral of the matter in dispute, FWC shall first conciliate in respect of the matter and if the matter is not resolved by conciliation, FWC shall then arbitrate in respect of the matter.
For the purpose of making conciliation under this Clause effective, when conciliating, FWC shall be able to conciliate by doing any of the things set out in, and/or in accordance with, sections 590, 591, 592 and 594 of the FW Act. When conciliating under this Clause, FWC can dismiss the matter or issue a recommendation or a statement expressing an opinion (but not an order or a decision).
For the purpose of making arbitration under this Clause effective, when arbitrating, FWC shall be able to arbitrate by doing any of the things set out in, and/or in accordance with, sections 589, 590, 591, 593 and 594 of the FW Act. When arbitrating under this Clause, FWC can dismiss the matter or make an order or decision.
During any conciliation or arbitration proceedings before FWC under this Clause, either party may choose to be represented by a legal practitioner.
If FWC issues an order or a decision in writing under this Clause, the order or decision and reasons for the order or decision will be provided in writing to the parties.
Where FWC issues an order or a decision in writing under this Clause, it shall be binding on the parties and persons bound by this Agreement in accordance with its terms.
Note: The reference in this Clause to sections of the FW Act is a reference to those sections as they were on the date of the commencement of operation of this Agreement.
A decision that FWC makes when arbitrating a dispute under this Clause is a decision for the purpose of Division 3 of Part 5.1 of the FW Act. Therefore, an appeal may be made against the decision in accordance with the FW Act.
6.4 Where a matter in dispute, has been referred to FWC under this Clause, and this Issues Resolution Procedure has been properly followed, an aggrieved person will be released from normal duties without loss of pay to attend the FWC proceedings. The Company will where necessary, release a representative of the aggrieved persons from normal duties without loss of pay to attend FWC proceedings.
[20] Clause 13 of the Agreement relevantly provides:
i. paid leave (personal leave) taken by an Employee because of a personal illness, or injury, of the Employee; or
ii. paid or unpaid leave (carer's leave) taken by an Employee to provide care or support to a member of the Employee's immediate family, or a member of the Employee's household, who requires care or support because of:
For the purpose of Personal / Carer's leave, immediate family is defined as:
13.2 The continuation of paid Personal leave will be reviewed on a regular basis. Provided the Company is satisfied the Employee was unable to attend work due to illness or injury, the following table should be used as a guideline in triggering a review of the Employee's situation.
13.2.1 Fixed term Employees are, in the event of genuine illness or injury, also entitled to paid Personal leave but payment will not be paid past the nominal end of their contract period.
13.3 An Employee will be entitled to apply for paid Carer's leave for up to a total of four (4) weeks in any twelve (12) month period as defined in Clause 13.1.
13.4 The nature of the illness or injury will be taken into account by the Company when determining what should apply. The Employee will, if required, provide the Company with evidence that would satisfy a reasonable person that leave was taken for the purpose set out in Clause 13.1.
13.5 Should a pattern of frequent short absences develop (e.g. Mondays or Fridays) or if the Company determines that an excessive amount of Personal/Carer's leave is being taken, the reasons for the absences will be thoroughly investigated. If medical documentation or other evidence cannot be produced that satisfies the Company, the Company may determine that the leave should be unpaid, and the situation may be regarded as a performance management issue.
13.6 Unless exceptional circumstances exist the Employee must notify the Company before the start of the first shift on which they will be absent.
13.7 Employees will not be entitled to paid Personal/Carer's leave during any period during which the Employee is receiving accident pay.
13.8.1 Employees must advise the Company if it becomes clear during Personal leave that they will be unable to return to their normal duties. Available options concerning alternate duties will then be canvassed.
13.8.2 If an Employee returns to work after a period of illness or injury and is unable to perform their normal duties, all reasonable efforts will be made to accommodate a person's incapacity.
13.8.3 Transfer to an alternative position may be temporary or permanent, depending on the
Employee's ability to fully recover and may require a new Annualised Salary for the new position to be determined.
The Company will take all reasonable steps to accommodate a persons' incapacity, however circumstances may arise where it becomes necessary to terminate employment because of that person's inability to perform the duties required of their position.
[21] The CFMEU argued that the parties remain in dispute about the operation of clause 13 of the Agreement and it is for that reason that the matter should proceed to arbitration. The parties remain in dispute about whether the period referred to in clause 13.2 is a continuous or cumulative period, whether clause 13 provides for one or two review processes, and the parties disagree on the definition of what is an excessive amount of leave in relation to clause 13.5. On that basis it argued that the dispute is still very much alive.
[22] The CFMEU agreed that the determination sought is now different from the relief set out in the initial application. However, the CFMEU argued that the dispute has evolved during proceedings and that in characterising the matter, the Commission is not confined to the application that was filed or to the relief that was originally sought.
[23] The CFMEU submitted that it has long been evident that the parties were in dispute concerning fundamental issues as to the proper meaning of clause 13 of the Agreement. In this regard, the CFMEU submitted that the resolution of that dispute will require the Commission to express an opinion about a legal matter namely the proper operation of clause 13 of the Agreement. It argued that the Commission will stay within the power of private arbitration, and will not be exercising judicial power, provided that any opinion expressed about a legal matter is expressed as a step in resolving the dispute between the parties.[2]
[24] The CFMEU relied on a number of authorities to support its submission that the Commission can make decisions as to a party's legal rights and liabilities when exercising the power of private arbitration pursuant to an agreed dispute resolution procedure.[3]
[25] The CFMEU relied on the following principle in Maritime Union of Australia v ASP Shipping Management Pty Ltd[4] in support of its argument that a dispute has the capacity to evolve:
[19] In Re PKIU; Ex parte Vista Paper Products Pty Ltd Goudron J (with whom Brennan, Dawson and Toohey JJ relevantly agreed) noted that:
... an industrial dispute is not necessary fixed and definite, either in terms of its subject-matter or in terms of the parties to it; a dispute 'may be diminished or ended or enlarged or altered during... proceedings in the Commission' or, for that matter, at any stage during the course of the dispute itself.
[26] Further, the CFMEU contended that Dendrobium's concerns about natural justice can be easily addressed, by allowing the parties a short period of time to file and serve any further witness statements and written submissions addressing the amended relief sought before any substantive hearing.
[27] The CFMEU argued that the dispute should proceed to arbitration and the Commission should reject any argument that there is no utility in dealing with the dispute as there are two other affected members covered by the Agreement who should be entitled to paid leave. It further argued:
'...there's a significant number of employees who get the benefit of this agreement and quite plainly, given circumstances where the union and the company remain apart as to quite fundamental issues of what someone's personal leave entitlement is, there is plainly utility in dealing with the dispute, because it impacts, plainly upon persons greater than Mr Finnerty.'[5]
[28] Dendrobium submitted that the matters now in dispute are significantly different to the dispute described, and relief sought, in the application dated 4 August 2016. In Dendrobium's submission, the CFMEU cannot pursue the matter in the Commission as it is now framed, under the vehicle of the present application, as the pre-requisite steps outlined in clause 6 of the Agreement have not been followed in respect of the differently characterised matter.
[29] The written submissions filed by Dendrobium argued that:
'The failure to properly follow the procedure in respect of a dispute about a matter not only denies the parties from properly attempting to discuss the matter but also impacts on whether or not the Commission's jurisdiction to deal with the matter has been properly enlivened.'[6].
[30] Dendrobium gave oral submissions that 'in the absence of there no longer being a live dispute relating to two members or the two discrete matters as notified by the union and pursued initially by the union, we are left with nothing more than an abstract question'.[7]
[31] Dendrobium argued that there is no practical basis for the relief sought in the application that: 'Mr Finnerty is entitled to receive paid Personal leave for six of the eight shifts that he was absent in the period from 16 November 2015 to 26 November 2015', nor is there a requirement for the Commission to grant such an order, given its decision to pay Mr Finnerty for the six shifts as sought.
[32] Further, Dendrobium argued that the relief now sought by the CFMEU amounts to, in effect, declarative relief which is said to have general application and relevance and was not a matter which had been raised prior to the hearing on 1 August 2017.
[33] Dendrobium contended that the Commission will be acting beyond the power afforded to it under clause 6 of the Agreement in dealing with the matter, given that it is of a very different character to the dispute which was notified in the application.
[34] Dendrobium argued that it is not appropriate for the application to be used as a vehicle to pursue broader industrial issues relating to the operation of clause 13 or disputes relating to other members. In its written submissions, Dendrobium contended that:
'While there may be other members affected, or broader underlying issues, these can be appropriately pursued under the disputes resolution procedure without truncating or circumventing the applicable procedure or using the Application as a vehicle to raise the broader issues and request that the Commission now arbitrate in respect of them.'[8].
[35] Dendrobium also argued that there is a fundamental natural justice consideration in not entertaining the dispute as it is now framed. Dendrobium contended that it would have led evidence of a different nature prior to the hearing, had they known about the amended relief sought by the CFMEU.
[36] Given the characterisation of the dispute by the CFMEU, the relief sought in the application and the submissions filed by the parties, it is apparent that the dispute (at the time the matter was listed for hearing) was confined to the particular circumstances of Mr Finnerty and his entitlement to be paid particular shifts on specific dates as set out in the application.
[37] I am persuaded by Dendrobium's submission that there is a fundamental natural justice consideration in not dealing with a dispute in circumstances where it has changed significantly from the dispute described and the relief sought in the application. This is particularly so where Dendrobium was not on notice of such a fundamental change until the day of the hearing.
[38] Given Dendrobium agreed to pay the disputed shifts, in effect agreeing to the relief sought by the CFMEU, I consider that the dispute was resolved. In my view it is irrelevant that Dendrobium agreed to pay Mr Finnerty for the disputed shifts 'unilaterally', given that in doing so, it provided the relief sought by the CFMEU.
[39] I note there is nothing preventing the CFMEU, having followed the required steps in the Issues Resolution Procedure (clause 6) and if any dispute remains unresolved, from making a further application to the Commission.
A Walkaden for the Construction, Forestry, Mining and Energy Union.
[2] CFMEU's written submissions, dated 8 August 2017, paragraph 32.
[3] See CFMEU v The Australian Industrial Relations Commission & Anor [2001] HCA 16; CEPU v Telstra Corporation (PR933892), Telstra Corporation Limited (PR940569); and Brown & Welsh v Broadspectrum Limited [2016] FWC 2004
[6] Dendrobium's written submissions, dated 3 August 2017, paragraph 11.
[8] Dendrobium's written submissions, dated 3 August 2017, paragraph 57.
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Construction, Forestry, Mining and Energy Union
Dendrobium Coal Pty Ltd [2017] FWC 4062