Hayman Reese a Division of TriMas Corporation Pty Ltd v Automotive Food... [2001] FCA 1328 | Case summary

REASONS FOR JUDGMENT 1 On 4 September 2001, the applicant filed an application seeking penalties under s 170NF of the Workplace Relations Act 1996 (Cth) ("the Act") for contravention by the first respondent ("the Union") and three employees of the applicant of ss 170MN and 170NC of the Act and seeking injunctive relief to restrain contravention of those sections. On 5 September 2001, I granted injunctions restraining the Union until 4.30pm on 7 September 2001 from: · directing, inducing, encouraging or procuring any employee of the applicant at 20‑50 Waterview Close, Dandenong South, Victoria ("the applicant's premises") to stop work or fail to work other than in accordance with the terms of the certified agreement between the applicant and the Union certified on 29 November 2000 ("the certified agreement") for the purpose of supporting or advancing claims in relation to a guarantee of job security and in relation to the outsourcing of products for manufacture or partial manufacture by contractors; · preventing, hindering or interfering with access to and egress from the applicant's premises by any person or vehicle. I published my reasons for judgment: [2001] FCA 1279, and I incorporate those reasons for judgment in these reasons. In summary, the application by the applicant came about because a number of the applicant's employees had ceased work and had commenced a picket outside the applicant's premises which was preventing access to and egress from the applicant's premises by persons and vehicles. The obstruction was causing substantial disruption to the applicant's business which the applicant claimed was causing it substantial loss and damage. 2 At that initial stage, the Union and the second, third and fourth respondents, who were employees of the applicants, were the only respondents to the proceeding. At that time, only the Union appeared by counsel and as I was not disposed to consider urgent interlocutory relief against the personal respondents in their absence, the applicant did not press the claim for interlocutory relief against the personal respondents at that stage. 3 The matter came before me again on 7 September 2001 when I gave the applicant leave to join the fifth to twenty‑fourth respondents in the proceeding, they being employees of the applicant who were refusing to work and who it was said were participating in the picket. On that day, I extended the injunction restraining the Union from preventing, hindering or interfering with access to or egress from the applicant's premises by any person or vehicle until 4.30pm on 11 September 2001 and I restrained the fifth to twenty‑fourth respondents in similar terms. At that time, there was no evidence that the second, third and fourth respondents were participating in the picket. 4 On 11 September 2001, I extended the injunctions granted on 11 September 2001 to 4.30pm on 13 September 2001. When the matter came on for hearing before me on 13 September 2001 counsel announced an appearance for all respondents save the twelfth and eighteenth respondents, Alan Clarke and Jason Kraus. For ease of reference I will refer hereafter to the personal respondents as "the employees". 5 Since I first granted injunctions on 5 September 2001, a considerable number of the applicant's employees have continued to refuse to return to work and the picket has continued in the circumstances to which I shall refer. 6 After I granted the injunction against the Union on 5 September 2001, the Union has not participated in the picket which has nevertheless continued. Counsel for the applicant acknowledged that the applicant could not assert that the picket was an official Union picket or that the picket was being procured by the Union. In short, it appears that the Union has complied with the injunction granted against it in relation to the picket. The evidence discloses the following circumstances which have occurred on and since 5 September 2001: · after the injunctions were granted against the Union on 5 September 2001, the personal respondents (save for the second, third and fourth respondents) at various times on 5, 6 and 7 September, were involved in the picket which was obstructing and preventing vehicles and persons from entering and leaving the applicant's premises; · on the morning of 6 September 2001, about fifteen to twenty persons who were not employees of the applicant joined the picket; · shortly afterwards, Ms Linda Pope, the Union organiser, held a meeting outside the premises which was attended by the applicant's employees who were participating in the picket and those persons who were not employees. Ms Pope distributed a document to those present which was apparently a copy of my order of 5 September 2001. At the conclusion of the meeting, Ms Pope and the second, third and fourth respondents left the site; · thereafter on 6 September 2001 the picket, comprising employees of the applicant and persons who were not employees, continued to obstruct and hinder access to and egress from the applicant's premises by vehicles and persons and this has continued to cause substantial disruption to the applicant's business; · on 10 September 2001, the picket remained in place at the front entrance of the applicant's premises and it comprised persons who were not employees of the applicant. A number of employees asked Mr Cooke, the applicant's manufacturing manager, who had gone to the picket line, to resolve the matter but one of the employees told the other employees not to talk to Mr Cooke as the Union had given instructions not to talk to him and said that the Union was handling the matter; · on 10 September 2001, a conference was held at the Australian Industrial Relations Commission between the applicant and the Union. The conference was adjourned until 11 September 2001. It concluded on that day without any resolution of the issues between the parties being reached and no further hearing before the Commission has been listed; · on 11 September 2001, an unknown person cut the lock on the external power supply to the applicant's premises, the oil from the transformer for the cooling system contained in the external energy supply box was drained and, as a result, the applicant had to close its factory until the external power supply could be fixed. The power supply was cut off not only to the applicant's premises but to other premises in the vicinity and was not restored until 5.00pm on 11 September 2001; · on 12 September 2001, the picket continued across the gate at the front entrance of the applicant's premises but the persons on the picket line were not employees of the applicant. A number of the employees were standing near the front entrance of the applicant's premises, but were not participating in the picket line. The persons on the picket line continued to obstruct and prevent vehicles and persons from entering or leaving the applicant's premises; · on 12 September 2001, police attended the picket but were not prepared to remove the persons on the picket line. A truck loaded and ready to leave the applicant's premises was prevented by the picket from doing so and had to be unloaded before it could leave; · on 13 September 2001, the picket continued and consisted of persons who were not employees of the applicant. Employees of the applicant, including the second to twenty‑fourth respondents, were standing outside the premises but not participating in the picket. Mr Malcolm Perry of the Union was also present with the employees; · a number of employees have expressed concern to the applicant that they wish to return to work but are scared to do so because the Union has told them that if they cross the picket line there would be consequences. Other employees wish to return to work but are concerned about the attitude of the Union; · the respondent employees (other than the second, third and fourth respondents) were active on the picket line until the injunction was granted against them on 7 September 2001. Since then, they have not participated in the picket but have been present outside the premises of the applicant close to the picket, as have the second, third and fourth respondents; · the respondents' solicitor has filed an affidavit in which he says that he has been informed by officers of the Union that a number of industrial issues have arisen between the applicant and its employees in recent months which have involved the applicant not complying with the certified agreement and otherwise disadvantaging its employees. The applicant has denied these allegations and has given explanations for the circumstances which have occurred which do not involve non‑compliance with the certified agreement. For present purposes it is not necessary to consider these allegations in any detail other than to note that they exist and will need to be investigated in the separate proceeding filed by the Union. 7 The applicant submitted that the injunction restraining the Union and the employees from interfering with access to or egress from the applicant's premises by any person or vehicle should be extended as the picket was still continuing and causing disruption to the applicant's business. The applicant sought an interlocutory injunction restraining the employees from stopping work or failing to work other than in accordance with the terms of the certified agreement for the purpose of supporting, or advancing claims against the applicant in relation to a guarantee of job security or in relation to outsourcing of products for manufacture or partial manufacture by contractors. The applicant also sought an injunction against the Union restraining it from directing, inducing, encouraging or authorising the employees to participate in this conduct. 8 The applicant's submissions can be conveniently summarised in the following terms: · although the evidence did not disclose that the picket in its present form was an official Union picket or was being procured by the Union, it was likely, if no further injunction was granted, that the earlier situation would be restored as the employees, although not presently involved in obstruction activities, were previously involved in obstruction activities; · the employees had ceased work although the certified agreement was in force, the evidence disclosed that the Union was involved in the industrial action, the Union's position was important in relation to the issue and employees were concerned about Union control or approval of their action; · the balance of convenience was in favour of the granting of injunctive relief as the only practical remedy available for the applicant was an injunction. If the employees returned to work they would be paid in accordance with the certified agreement which was not a detriment and the Court should not be reluctant to order employees back to work. 9 The respondents submitted: · there was insufficient evidence to establish that the Union had procured the picket in its present form, there was no evidence that the respondents were not complying with the injunction and there was a distinction between standing in the vicinity of the gates and preventing access and egress. The Court should not draw an inference adverse to the Union from the presence of unknown persons on the picket; · the employees were not presently involved on the picket and any injunction should only be sought against the persons causing the obstruction; · the Court should not exercise jurisdiction compelling the employees to return to work thereby, in effect, granting specific performance of a contract for personal services; · it was not appropriate to make an order against the Union in relation to the employees returning to work as there was no evidence that the Union exercised any control over the employees. The Union was only representing the employees' interests and the terms of the certified agreement were too vague to be enforceable by the Court. · any injunction compelling the employees to return to work would deny them the opportunity to bring pressure to bear upon the applicant in relation to the resolution of the current dispute. There was a serious question to be tried that the applicant had breached the certified agreement and thereby contravened s 298K of the Act. 10 At the present time, the picket continues to interfere with access to and egress from the applicant's premises by persons and vehicles with a consequent significant disruption to the applicant's business. Since the grant of the injunction on 7 September 2001 restraining the fifth to twenty‑fourth respondents from preventing, hindering or interfering with access to and egress from the applicant's premises by any person or vehicle, it does not appear that those respondents have been actively participating in those activities which have obstructed and interfered with access to and egress from the applicant's premises. Nevertheless, they have remained from time to time in front of the applicant's premises in close proximity to the unknown persons on the picket who have continued to obstruct persons and vehicles seeking to enter and leave the applicant's premises. Such action of the employees is not conduct in breach of the injunction. They are entitled to undertake and participate in peaceful picketing outside their employer's premises. It is not suggested that they have blocked access to the premises since the injunction was granted against them. Further, there is no evidence which entitles me to conclude that the Union is presently directing the conduct of the picket which is causing the obstruction. Any such activity would be in breach of the injunction against the Union. 11 However, the fact that the employees and the Union may not presently be involved in the picket which is causing the obstruction is not a bar to a continuation of the injunction against them having regard to the circumstances which brought it about. The injunction was initially granted against the Union and the fifth to twenty-fourth respondents because I found that there was a serious question to be tried that the picketing activities which involved obstruction and interference with access to and egress from the applicant's premises by persons or vehicles constituted a contravention of s 170NC of the Act. The Union submitted that there was no evidence that the Union was involved in the setting up of the picket as it had been brought about by the employees. I was satisfied, and continue to be satisfied, that the role and actions of Ms Linda Pope, the Union organiser, in the activities, discussions and meetings which led to the employees informing Mr Cooke that unless they got a letter by the end of the day guaranteeing their job security, they would put a picket in place the following morning, gave rise to a serious question that the Union was involved in the implementation of the picket which occurred thereafter. 12 It is true that, at the present time, the Union and the employees are not participating in the picket which is presently causing the obstruction to access to and egress from the applicant's premises. But that is no doubt because of the injunction which has been in place. Having regard to the fact that it was necessary for an injunction to be granted in order to ensure that the Union and the employees did not continue to participate in those activities of the picket which involved obstruction and interference with access to and egress from the applicant's premises, and having regard to the fact that the picket continues to carry out such obstruction and interference and that the employees and a Union representative have congregated close to the picket, I consider it appropriate to continue the injunction against the Union and the employees whilst the picket continues to obstruct access to and egress from the applicant's premises. 13 I do not reach this conclusion on the basis that the unknown persons presently manning the picket are acting at the direction or under the instructions of the Union and the employees. Rather, I reach this conclusion on the basis that as the obstruction and interference by the picket commenced with the employees, with the involvement of the Union to which I have referred, and as it has continued albeit with other unknown persons, there is a likelihood that the employees will return to and participate in the picket and the obstruction activities of the picket unless the injunction is continued. There has been no indication from the employees or the Union that if the injunction is not continued, the employees will not continue to participate in the obstruction activities of the picket. I am satisfied that the sequence of events and reasons which led me to the conclusion that an injunction should be granted restraining the Union, and then the employees, in relation to the obstruction and interference activities of the picket still apply and include the second, third and fourth respondents. The balance of convenience is in favour of the grant of such injunction, having regard to the disruption the picket is causing to the applicant's business and the consequent loss and damage the applicant is suffering. 14 The second injunction sought against the respondents raises different considerations. I granted an injunction on 5 September 2001 restraining the Union from directing, inducing, encouraging or procuring any employee of the applicant to stop work or fail to work other than in accordance with the terms of the certified agreement for the purpose of supporting or advancing claims in relation to a guarantee of job security and in relation to the outsourcing of products for manufacture or partial manufacture by contractors. I was satisfied at that time, and remain satisfied, that there is a serious question to be tried that the conduct of the employees in withdrawing their labour, and the participation of the Union in that conduct, constitutes a contravention of s 170MN of the Act. At the time I granted the injunction, I only granted it against the Union as the employees did not appear at the initial urgent hearing. At that time, the applicant did not persist with the application for urgent interlocutory relief against the employees. When the matter came on for hearing on 7 September 2001, I was not disposed to continue that injunction at that time having regard to the affidavit filed by the respondents' solicitor which raised issues (which have now been contested by the applicant) as to non‑observance of the provisions of the certified agreement by the applicant. The applicant seeks an injunction in those terms. 15 I remain satisfied that there is a serious question to be tried that the conduct of the Union, through its organiser Ms Pope, constitutes industrial action of the type proscribed by s 170MN(1) of the Act. The issues which brought about the employees' withdrawal of their labour relate to their employment which is subject to the certified agreement. The withdrawal of labour constitutes "industrial action" for the purposes of s 170MN(1) and for the reasons to which I have referred in my earlier judgment, in particular by reference to the definition of "engaging in conduct" in s 4(8) of the Act, I am satisfied that there is a serious question to be tried that the Union has been engaging in that industrial action, albeit that it may have been doing so by way of organisation rather than participation. 16 On the present state of the evidence, I consider that there is a serious question to be tried that the Union continues to be involved in that industrial action. The Union submitted that the evidence did not support the finding that it had organised the withdrawal of labour, and that I should not infer from Ms Pope's statement to Mr Cooke on the afternoon of 31 August 2001 that the employees would not return to work until there was no outsourced product on site, that the Union had organised the withdrawal of labour. The Union pointed to the evidence that before the meeting was held at which that statement was made, the employees had told the applicant's human resources coordinator that if she did not meet with Ms Pope, the afternoon shift would go home and the day shift would be asked not to work on Monday morning. However, the evidence also discloses that Ms Pope met with the employees shortly prior to the statement being made to the human resources coordinator. 17 The Union also submitted that it was not appropriate to grant an injunction against the Union as it would be a futile order because it was the employees who had taken the action of withdrawing their labour and there was no evidence that the Union exercised control over the employees. That may be so, but it is apparent from the evidence that the Union is playing a significant role in the industrial dispute which has arisen and that the industrial action that has been taken is not "protected action" for the purposes of Div 8 of Pt VIB of the Act. If an injunction is granted against the Union in the terms sought, it would be a negative injunction in the sense that it would restrain the Union until the hearing and determination of the proceeding from directing, inducing or encouraging any employee to withdraw his or her labour. 18 In these circumstances, I am satisfied an injunction should be granted so restraining the Union. The balance of convenience is in favour of the grant of the injunction, having regard to the deleterious effect of the withdrawal of labour on the applicant's production. 19 However, different considerations arise in relation to the injunction sought against the employees. The effect of such an injunction would be to compel them to attend for, and perform, work for the applicant. The respondents submitted that the courts were traditionally reluctant to grant such injunctions which had the effect of compelling specific performance of a contract for personal services. The respondents submitted that although the Court had the jurisdiction to grant such an injunction, it was not appropriate, particularly where there was an issue raised as to whether the applicant had breached its obligations under the certified agreement and had thereby contravened s 298K of the Act and particularly where the terms of the certified agreement were so general that it would not be clear, in any given circumstance, whether an employee was working in accordance with the terms of the certified agreement. 20 Although there has been a traditional reluctance of courts to order specific performance of contracts for personal services, it has been accepted that it is not a bar to granting an injunction, that a consequence is that a person may be compelled to return to work in order to comply with the order. In Turner v The Australasian Coal and Shale Employees' Federation (1984) 6 FCR 177, the Full Court recognised that the issues which underlay the reluctance of courts to grant specific performance of a contract of employment went more to the issue of the discretion to grant the relief, rather than to a fundamental reason why the relief should not be granted. The Court said at 192‑193: "Another feature of contracts of employment which has caused concern in some of the authorities is the suggested rule that specific performance of a contract of employment can never be granted. This supposed rule is based upon two considerations. First, it is said that a repudiation of the contract by one party destroys the mutual confidence which must exist between employer and employee, and equity will not compel the parties to continue in an employment relationship where such confidence is absent. Secondly, it is argued that to compel the existence of an employment relationship would be to require the court to supervise the conduct of both parties to that relationship on a continuing basis. It may be seen that the first of these considerations has lost a good deal of its relevance in present society. It is difficult to say that a relationship of mutual confidence must exist in the case of every person employed by a large corporate enterprise. There are many occupations in such enterprises where the precise identity of the employee performing a particular job is immaterial to the collective management of the corporation. There are some cases in which dismissal occurs but the mutual confidence of employer and employee survives; Hill v C A Parsons & Co Ltd, supra, was an example of this type of case. The dismissal of the engineer in that case resulted purely from his refusal to join a trade union which had a 'closed shop' agreement with his employers. As to the second ground, the problem of continuing supervision by the court is not one confined to contracts of employment. There are situations in which, in the exercise of its discretion to refuse an equitable remedy, a court will decline to grant specific performance which would involve constant recourse to the court by the parties and determinations by the court of the rights and wrongs of a multiplicity of obligations in the contract. Such cases are, however, matters of discretion, and not matters of hard and fast rule that specific performance cannot be granted. Contracts of employment should now be viewed in the same light." 21 In such cases where injunctions are granted, the Court is not laying down the terms upon which the employment is to be undertaken, rather the order has the effect of requiring the continuation of a pre‑existing relationship governed by a pre‑existing and identifiable agreement. This issue was recognised in Australasian Meat Industry Employees' Union v G & K O'Connor Pty Ltd [2000] FCA 627. Gray J said at [46] and [47]: "In the past, courts have tended to refrain from using the remedy of injunction to require one person to enter into, or to continue, an employment relationship with another. This reluctance might stem from the presence of a supposed rule that courts will not grant specific performance of contracts of employment, a rule which has proved less than absolute. There has been some readiness to grant injunctions restraining the taking of industrial action, the effect of which is to force those taking the industrial action to resume work. See, for instance, Emerald Construction Co Ltd v Lowthian [1966] 1 WLR 691 and Epitoma Pty Ltd v Australasian Meat Industry Employees Union (1984) 3 FCR 55. Courts have indirectly enjoined employees to continue working for particular employers by granting injunctions to enforce obligations of those employees to refrain from working for anybody else. See Lumley v Wagner (1852) DeGM&G 604, (1852) 42 ER 687 and Warner Brothers Pictures, Incorporated v Nelson [1937] 1 KB 209. In some circumstances, courts have been ready to grant injunctions preserving employment relationships. An employer might be ordered to refrain from treating a particular act as having brought about the termination of a contract of employment. See, for instance, Hill v C A Parsons & Co Ltd [1972] Ch 305. Another example of such an injunction, granted on an interlocutory basis, is Baker v Corporation of City of Salisbury (1982) 2 IR 168. In cases like Hill and Baker, the obligations of the employer and the employee, upon which their continuing relationship depends, are not dictated by the injunction itself. They continue to be governed by the contract of employment and by rules of law from other sources, bearing on the employment relationship. Thus, an employer enjoined to refrain from treating a purported act of dismissal as terminating the contract of employment remains free to dismiss the employee concerned, if the occasion arises, by whatever lawful means are open. The employer and the employee concerned remain free to manage their relationship in the normal way, and free to vary it if they see fit. The relationship remains a consensual one, the only compulsion being against viewing it as having been terminated by a particular past act." 22 The injunction which is sought is not an injunction to enforce the terms of the certified agreement, but is rather an injunction to restrain the employees from failing to work otherwise than in accordance with the certified agreement. In this way the Court would not be enforcing the certified agreement, but would be enforcing compliance with s 170MN(1) of the Act on an interlocutory basis: Australasian Meat Industry Employees' Union v G & K O'Connor Pty Ltd [2000] FCA 1760 at [92]. 23 I do not consider that there is any substance in the submission by the respondents that the granting of an injunction would not result in mutuality of obligation on the part of the employees and the applicant. The Union submitted that there was a serious question to be tried whether the applicant had breached the certified agreement and thereby contravened s 298K of the Act in respect of the issues raised by the respondents' solicitor. This has been the subject of a proceeding issued by the Union against the applicant and is presently pending in the Court. The applicant continues to be bound by the certified agreement and its obligations may be enforced at the suit of the Union. 24 The respondents submitted that if the injunction was granted, it would not be clear what were the obligations imposed upon the employees as a result of their obligation to comply with the injunction. The form of the injunction is limited to stopping work or failing to work for the purpose of supporting or advancing claims against the applicant in relation to a guarantee of job security or in relation to outsourcing of products for manufacture or partial manufacture by contractors. I consider that an injunction in that form sufficiently identifies the matters which are proscribed. There may be provisions of the certified agreement which are couched in general terms, but that does not mean that an injunction in the form sought is too vague or indeterminate to be enforceable by the Court. 25 I do not accept that it is a relevant consideration that the injunction denies the employees the opportunity to bring pressure to bear upon the applicant in relation to the existing industrial dispute. The employees are entitled to raise issues which may bring pressure to bear upon the applicant in relation to an industrial dispute, but what they are not permitted to do, according to s 170MN of the Act, is engage in industrial action, whilst a certified agreement is in operation, such as the withdrawal of their labour, "for the purpose of supporting or advancing claims against" the applicant in respect of their employment: s 170MN(1). The injunction should not prevent the employees from taking any action which they are entitled to take under the Act. Their rights in this respect can be protected by inserting in the form of the injunction proposed a proviso that they be able to take action if otherwise allowed by the Act. 26 Although the employment relationship between the employees and the applicant is one involving personal interaction between them, I do not consider that this is a case where it might be said that the mutual confidence of employer and employee has disappeared. The employees are concerned about a particular industrial issue, but they have not indicated that they are not prepared to go back to work whatever be the outcome of the industrial dispute. 27 The balance of convenience is in favour of the grant of an injunction, having regard to the substantial disruption caused to the applicant's business and its production activities and the consequent loss and damage it is suffering. 28 I am therefore satisfied that an injunction should be granted restraining the employees from withdrawing their labour and failing to work otherwise than in accordance with the terms of the certified agreement for the purpose of supporting or advancing claims against the applicant in relation to a guarantee of job security or in relation to outsourcing of products for manufacture or partial manufacture by contractors other than in accordance with the Act. They should not be restrained from taking any industrial action which is otherwise open to them under the Act or which is not related to the purposes for which they are presently withdrawing their labour. I certify that the preceding twenty-eight (28) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Goldberg.

Hayman Reese a Division of TriMas Corporation Pty Ltd v Automotive Food Metals Engineering Printing & Kindred Industries Union

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