Fair Work Act 2009

s.240 - Bargaining dispute

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

Alleged dispute concerning percentage wage increases

• [1] Dana Australia Pty Ltd (Dana) operates a manufacturing and distribution facility in Keysborough, Victoria where it carries out truck manufacturing and assembly operations and the distribution of certain aftermarket parts. It has applied to the Commission to deal with a bargaining dispute under s 240 of the Fair Work Act 2009 (Act). Since 18 August 2021 Dana has been involved in bargaining for a proposed enterprise agreement which if made and approved would replace its current agreement which has passed its normal expiry date of 25 September 2021. The Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union, known as the Australian Manufacturing Workers' Union (AMWU) is a bargaining representative for the proposed agreement.

• [2] The dispute the subject of the application is about a current disagreement about wage increases that would be contained in the proposed agreement. Dana has offered 3 wage increases during the life of the proposed agreement of 2.75% each while the AMWU maintains a claim for each wage increase to be of 3%.

• [3] Section 240 of the Act relevantly provides that a bargaining representative for a proposed enterprise agreement may apply to the Commission for the Commission to deal with a dispute about the agreement if the bargaining representatives for the agreement are unable to resolve the dispute. By s 240(4) the Commission may arbitrate the dispute if all the bargaining representatives agree. The Commission may otherwise deal with the dispute as it considers appropriate, including by mediation or conciliation, or by expressing an opinion or making a recommendation (see s 595(2)).

• [4] The AMWU has raised a jurisdictional objection to my capacity to deal with the dispute. The parties were directed to file written submissions and they agreed the jurisdictional objection could be determined on the papers without an oral hearing. The AMWU contends that the Commission has no jurisdiction to deal with Dana's application because there is no "dispute about the agreement" within the meaning of the Act and further, even if there is such a dispute there is no evidence that the bargaining parties are "unable to resolve the dispute".

• [5] As to the question whether there is a dispute about the agreement the AMWU in essence contends:

• It is meeting good faith bargaining requirements;

• Meeting these requirements do not require a bargaining representative to make concessions or to moderate its demands;

• An inability of bargaining parties to reach an agreement is not evidence that either party is not meeting the good faith bargaining requirements;

• Dana's complaints are about the bargaining process which has not yet produced an agreement but there is no suggestion that the good faith bargaining requirements are being breached;

• A dispute would arise from capricious or unfair conduct by a bargaining representative, but there is no suggestion of any such conduct;

• A dispute which amounts to no more than a complaint that bargaining that is occurring within the framework of the good faith bargaining requirements, has not produced an agreement is not a dispute about the agreement within the meaning of s 240(1) of the Act.

• [6] There is no substance to the AMWU's contentions.

• [7] The phrase "dispute about the agreement" means no more than a debate, controversy or a quarrel about the proposed agreement in relation to which there is or has been bargaining. It includes a dispute about one or more terms that should be included in the proposed agreement. There is no reason to read down the phrase as being confined to disputes about good faith bargaining requirements. Section 240 of the Act is part of a scheme in Division 8 of Part 2-4 which sets out by various means the Commission's general role in facilitating bargaining, which would plainly include, as s 240(1) contemplates, assisting the bargaining parties by resolving disputes about one or more terms that should be included in the proposed agreement.

• [8] Moreover, the objects of Part 2-4 in s 171 include an object "to enable the FWC to facilitate good faith bargaining and the making of enterprise agreements, including through . . . dealing with disputes where bargaining representatives request assistance". The object of facilitating the making of agreements is given voice in s 240 by enabling the Commission to deal with a dispute about a proposed agreement, which includes a dispute about what content should be included in the proposed agreement.

• [9] In the instant case the bargaining parties have, through bargaining since August last year, made progress on most of the terms that are to be included in the proposed agreement but remain in dispute, that is to say, the bargaining parties continue to debate or quarrel about the level of wage increase for which the proposed agreement should provide. There is thus plainly a "dispute about the agreement" within the meaning of s 240(1) of the Act. That the parties continue to bargain over disputed terms of a proposed agreement does not mean that the parties are not in dispute about the agreement. Bargaining does not need to have been exhausted before the Commission's assistance may be sought under s 240. There is here a dispute about the level of wage increases that should be contained in the proposed agreement and so there is a dispute about the agreement within the meaning of s 240.

• [10] As to whether the bargaining representatives for the agreement are "unable to resolve the dispute" the AMWU contends in summary that the issue of wages continues to be part of bargaining and will be resolved through bargaining. No stalemate has been reached and bargaining is working as intended. Therefore, the parties are able to resolve the disputes through continued bargaining.

• [11] These contentions are also rejected. The effect of the AMWU's contentions is that the parties are confined to an option only of continuing bargaining even though they have been unable to agree on and remain in dispute about, a particular term or terms of the agreement. And whilst ever that situation pertains, it cannot be said that the bargaining parties are "unable to resolve the dispute". This contention gives limited work for s 240 of the Act to do and one not justified having regard to the text of s 240 and the statutory context in which that section appears.

• [12] As I have already noted bargaining need not be exhausted before a bargaining party seeks the assistance of the Commission under s 240. As a matter of fact, after a period of continued bargaining since August last year, the bargaining parties have been unable to resolve the matter of the quantum wage increases for which the proposed agreement should provide. The parties have been bargaining for almost 6 months with the issue of wage increases having been discussed at multiple bargaining meetings. The quantum of wage increases is and remains in dispute. Protected industrial action has been taken and the option of further action remains live. And the parties are presently unable to resolve the dispute.

• [13] For these reasons I am satisfied that the Commission's jurisdiction under s 240(1) has been properly enlivened and the AMWU's objection is dismissed. The application will be listed for a conference, notice of which will separately be sent to the bargaining parties.

• [14] For completeness, the AMWU raised several further matters going to Dana's motivation for making the application; the futility of any Commission intervention absent consent by the AMWU and the fact that it will not agree to an arbitrated outcome. None of these matters speak to the jurisdiction of the Commission to deal with the dispute under s 240(1) of the Act, and so I do not propose to say anything further about them.

• [15] The jurisdictional objection raised by the AMWU to Dana's application under s 240(1) of the Act is dismissed.

Printed by authority of the Commonwealth Government Printer