Industrial Relations Secretary v Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales

Background

1. On 27 May 2022 the PSA held a meeting of its members at which the following resolution was passed: "This meeting endorses the unanimous position adopted by Departmental Committees, Workplace Groups and Vocational Branches for state wide 24-hour industrial action for members working in the NSW Public Sector. Members working in critical frontline roles may need to remain at work to ensure community safety. In the event that the PSA does not receive a wage offer from the Government that addresses inflation and the cost of living by COB Monday, 6 June 2022 the PSA will take industrial action on 8 June 2022 - to be called the PSA Day of Action."
2. I observe that although the resolution adopted the imprecise term of "industrial action", it was common ground that the PSA proposed a 24 hour strike commencing at midnight on 8 June 2022.
3. On 30 May 2022 Stewart Little, the General Secretary of the PSA, sent a letter to the Honourable Dominic Perrottet, the Premier of New South Wales. The title of the letter was "Crown Employees (Public Sector - Salaries 2021) Award". The letter stated: "We refer to our letters of 25 February 2022, 1 April 2022 and 29 April 2022 seeking a fair and reasonable pay rise for our members and to lift the arbitrary and unfair wages cap. To date, we have not received any response to the PSA's salaries claim or to the matters raised in our correspondence. We have repeatedly sought a meeting with you and our request has been continually denied. We have been denied the opportunity to ventilate the issues of our members. This is despite the fact that the current salaries award expires on 30 June 2022 and negotiations should be well advanced by now. As a result of the Government's refusal to engage with the PSA and its hardworking and essential workers the PSA membership has been left with no other option but to endorse industrial action in support of their demand for a fair and decent wage rise commensurate with inflation and the cost of living and an end to the wages cap. At the 2022 PSA Annual Conference, the PSA membership endorsed the unanimous position adopted by Departmental Committees, Workplace Groups and Vocational Branches that in the event that the PSA does not receive a wages offer from the government that addresses inflation and the cost of living by COB Monday 6 June 2022 the PSA will take 24-hour state wide industrial action on 8 June 2022. It is in your power to redress this situation. We remain, as always, willing to meet with you. …" (Emphasis in original)
4. Mr Little sent a second letter to the Premier on the same day in respect of PSA members covered by the Crown Employees (School Administrative and Support Staff) Award 2019. That letter was relevantly in the same terms as those reproduced above.
5. On Thursday, 2 June 2022 the Notification was filed. It attached copies of Mr Little's letters to the Premier. It asserted that the "industrial action has the potential to disrupt the provision of essential services across the State, including in the justice, police and education sectors". The Notifiers sought an urgent listing of the matter "to allow the parties time to conciliate with the Commission's assistance and, if such conciliation is unsuccessful, to proceed to arbitration prior to 8 June 2022". The Notification set out the terms of the dispute orders sought by the Notifiers, in the event that arbitration became necessary. In short, those orders would preclude the PSA or its members from organising or engaging in industrial action, and would operate from the day they were made until 7 August 2022.
6. I conducted conciliation of the dispute on Friday, 3 June 2022. It was a fruitless exercise, in large part as a result of the fact that the representatives of the Notifiers who were present, of which there were a significant number, had no authority or instructions to engage in meaningful discussions.
7. I listed the matter for report back on the morning of Monday, 6 June 2022. Ms J McDonald of Counsel, who appeared for the Notifiers, informed me that the Premier had, only minutes before the report back commenced, made an announcement as to the wage increases to be paid to public sector employees. She stated that she had an expectation that formal offers would be made to the PSA and other unions shortly.
8. Mr Gibian SC, who appeared for the PSA, stated that his client was unaware both that an announcement was to be made and of the substance of the announcement. The proceedings were adjourned to provide the parties with an opportunity to consider the Premier's announcement and the impact, if any, that it had on their respective positions.
9. The matter came back before me at 2.00pm on 6 June 2022. Mr Gibian stated that the PSA had not received any correspondence from the Government and that their understanding of the Government's position in respect of wage rises for its members was confined to a media release which had been issued following the Premier's announcement that morning. He stated that it was the PSA's intention to proceed with the industrial action on 8 June 2022
10. Mr I Taylor SC, who appeared with Ms McDonald for the Notifiers, pressed me to issue a certificate of attempted conciliation pursuant to s 135 of the Act, to allow the matter to proceed immediately to arbitration. Mr Gibian opposed that course of action, largely on the basis that the Government had not meaningfully engaged in conciliation. Having taken submissions from the parties, I stood the matter over until 9.00am on 7 June 2022, on the basis that the first order of business would be to determine whether or not a certificate ought to be issued.
11. At the commencement of proceedings on 7 June 2022 I explored with the parties the utility of conducting further conciliation and took further submissions as to whether I should issue a certificate of attempted conciliation. Given the positions advanced by the parties, I was satisfied that reasonable attempts had been made to conciliate the dispute and that there was no reasonable likelihood that the dispute would be resolved by conciliation. I determined that it was necessary to issue a certificate and I did so.
12. The matter then proceeded immediately into arbitration. The Notifiers read: 1. two affidavits of Simone Walker, the Group Deputy Secretary School Improvement and Education Reform Group for the Department of Education, affirmed respectively on 2 June 2022 and 6 June 2022; 2. an affidavit of Catherine D'Elia, the Deputy Secretary Corporate Services in the Department of Communities and Justice, sworn on 3 June 2022; 3. an affidavit of Carmel Meznaric, the Director of Operations in Service NSW, sworn on 2 June 2022; 4. an affidavit of Craig Moran, the Executive Director, Customer Journey Management, with Transport for NSW, affirmed on 2 June 2022; and 5. an affidavit of Dean Smith, an Assistant Commissioner in the NSW police Force, sworn on 2 June 2022.
13. The PSA read two affidavits of Alison Louise McRobert, a solicitor employed by the PSA, sworn respectively on 3 June 2022 and 6 June 2022.
14. In addition to the affidavits on which they relied, the parties tendered into evidence a number of other documents. I will not separately identify them.

Reasons for decision

1. Put shortly, the Notifiers' position came down to these propositions: 1. Section 146 of the Act requires the Commission in the exercise of its functions to "take into account the public interest". This includes having regard to the objects of the Act, and the state of the economy of New South Wales and the likely effect of its decisions on that economy. 2. The objects of the Act are set out in s 3, which include "to provide for the resolution of industrial disputes by conciliation and, if necessary, by arbitration in a prompt and fair manner and with a minimum of legal technicality" (s 3(g)). 3. The scheme of the Act anticipates that industrial disputes are resolved in or by the Commission, through conciliation and, if necessary, arbitration. It has been the "invariable approach" of the Commission to issue dispute orders in the face of threatened industrial action. 4. If the PSA wished to press its claims, the appropriate course was for it to have notified a dispute pursuant to s 130 of the Act, not to engage in industrial action. 5. The evidence adduced by the Notifiers demonstrated that there will be significant disruption caused by the planned strike. This had the potential to create safety and welfare risks, beyond the inevitable inconvenience that it will cause to the citizens of New South Wales. The Commission should intervene "to protect the public interest from the damaging effects of industrial action": Fire & Rescue NSW on behalf of the Department of Premier and Cabinet v Fire Brigade Employees' Union of New South Wales [2013] NSWIRComm 63 ("Fire & Rescue") at [41]. 6. The Commission could take judicial notice that the industrial action would have a negative effect on the economy of the State. This was necessarily the result of effectively stopping a large percentage of the State's employees working on a particular day.
2. The PSA opposed the making of any dispute orders. In a written outline of submissions it made four "observations", which may be summarised as follows: 1. It is a matter in the discretion of the Commission whether to make a dispute order. Unlike provisions in predecessor legislation, the Act does not prohibit industrial action, and so the Act "does not regard industrial action as inherently wrongful and illegitimate and appropriate for general prohibition". 2. The premise of the system for the making of dispute orders is that the Commission is able to resolve industrial disputes through the process of making awards setting fair and reasonable conditions of employment for employees. That power no longer exists, as a result of s 146C of the Act and cl 6 of the Industrial Relations (Public Sector Conditions of Employment) Regulation 2014 ("Regulation"). The Commission is "no longer able to set fair and reasonable conditions of employment in an unconstrained manner or to resolve any dispute in relation to rates of pay or conditions of employment". 3. The making of a dispute order is a serious step that should only be taken if the Commission is satisfied that the particular industrial action which is occurring or threatened is illegitimate in a sense warranting proscription. 4. The making of a dispute order has the effect of inhibiting the exercise by workers of a right to take industrial action which is "long recognised in international law". The Commission should give consideration to Australia's international obligations, including the recognition of the right to strike, when exercising its discretion under s 137(1)(a) of the Act.
3. Specific to the Notification, the PSA made these contentions: 1. The PSA's present claim on behalf of its members is for an increase in salaries of 5.2% from 1 July 2022, to maintain the real value of wages. In light of the Regulation, this is not a dispute capable of being resolved by the Commission. 2. The PSA had sought to engage in negotiations with the Government since February 2022. The Government had failed to make any substantive response to the PSA. It had further acted inconsistently with its own wages policy, which contemplates bargaining parameters being determined at least three months prior to the expiry of the relevant industrial instrument. 3. The evidence of disruption that might be caused by the stoppage was not such as to warrant the making of the dispute orders sought by the Notifiers. 4. In light of the current high rate of inflation, "long-term low levels of salary increases since 2011" and the impacts of the pandemic over the last two years, members of the PSA held a "reasonable and understandable grievance". Their desire to take industrial action was not arbitrary, capricious or unreasonable.
4. The Commission's powers to make dispute orders of the kind sought by the Notifiers is discretionary. This is apparent from the language of s 137 of the Act, which is relevantly in these terms: 137 Kinds of dispute orders (1) The Commission may make the following kinds of dispute orders when dealing with an industrial dispute in arbitration proceedings - (a) The Commission may order a person to cease or refrain from taking industrial action. … (2) If employees are taking industrial action in connection with the industrial dispute, the Commission may order the employees to cease taking that industrial action before it makes any other kind of dispute order against the employer.
5. The discretionary nature of the power is clearly seen in the repeated use of "may" in the provision. The exercise of that discretion will be informed by the Act as a whole, noting in particular ss 3 and 146, and the circumstances of the case. To the extent that the Notifiers' submissions are to be taken as suggesting that there is a presumption that in the face of threatened industrial action an order under s 137(1)(a) will be made, I do not accept them.
6. The Notifiers took me to Director General, NSW Department of Health v New South Wales Nurses Association (No 2) [2010] NSWIRComm 163, in which Boland J observed: "17 Nevertheless, it was always open to either party, or the Association in particular, given its frustration in not being able to make progress with the Department, to approach the Commission for assistance, but no approach was made. It is a weak excuse to say that the Department would only maintain its opposition in Commission's proceedings and that is why no application to the Commission was made. It completely overlooks the Commission's extensive conciliation and arbitration powers. It was submitted by counsel for the Association that the Association wanted the nurse/patient ratio dealt with quickly and it seemed to be suggested an arbitration on such a complex issue would be interminably long, citing the Department's alleged penchant for drawn out arbitration proceedings. 18 Whether the nurse/patient ratio issue needed to be subject to arbitration is something the Commission has not had an opportunity to even consider. But the Association obviously believes that direct industrial action is a short cut to achieving its claims. Whether or not that is right, the Association could have been under no misapprehension about the Commission's attitude. The Commission could not condone industrial action when there is a legislated system of conciliation and arbitration in place for resolving industrial disputes, when it is the Commission's duty to apply that system, when the Association has refused to engage that system and when the industrial action would disrupt the public health system for no good reason."
7. My attention was also drawn to the following passage from BlueScope Steel (AIS) Pty Ltd v Australian Workers' Union, New South Wales (2006) 153 IR 176; [2006] NSWIRComm 149, quoted in Fire & Rescue at [40]: "26. … The ability, in arbitration, to order industrial action to cease - to enable the parties to resolve the dispute efficiently and fairly under the auspices of the Commission rather than leaving the matter to be determined by the economic and industrial power of the participants without reference to the public interest - is one of the most important features of the system created by the Act."
8. There are two observations to make in respect of the passages just reproduced. First, the Commission's conciliation and arbitration powers are arguably not as "extensive" as they were at the time of Boland J's decision in 2010. There is force to the PSA's submission that the effect of s 146C of the Act and cl 6 of the Regulation is that the Commission may not be able to resolve the dispute between the parties.
9. In the arbitration of a dispute, the Commission may make or vary an award under Ch 2 Pt 1 of the Act: s 136(1)(b). Section 10 of the Act empowers the Commission to make an award "setting fair and reasonable conditions of employment for employees". Had the PSA notified a dispute in respect of its wages claim, as the Notifiers contended it should have done, it is at least theoretically conceivable that the Commission might determine that a wage increase in the quantum greater than that proposed by the Government was necessary to ensure that the conditions of employment for the employees remained fair and reasonable. However, the Commission would be powerless to effect that outcome. The Commission would be unable to "resolve the dispute efficiently and fairly under the auspices of the Commission", to adopt the language of the Full Bench in BlueScope Steel.
10. I accepted the submissions made by Mr Taylor that the Commission might still have been able to assist the parties in conciliation to resolve their dispute. This might have included helping to identify employee-related costs savings within the meaning of cl 6(1)(b) of the Regulation to enable a wage increase beyond the 2.5% cap in cl 6(1)(a).
11. But this gives rise to the second observation. The passages in the authorities referred to above, and Mr Taylor's submissions, anticipate that the notifier is ready, willing and able to engage constructively in the conciliation and arbitration process. There was no basis for a finding that the Notifiers would have done so.
12. In this case, the PSA had been attempting to commence negotiations with the Notifiers since February 2022. Its attempts had, in the main, been rebuffed. The PSA finally secured a meeting with the Honourable Damien Tudehope, the Minister for Employee Relations, on 1 June 2022. However, at that meeting neither the Minister nor the other government representatives present were able to engage in a discussion as to the PSA's wages claim. On 6 June 2022 the Premier announced "a new public sector wages policy" to operate for the financial years commencing 1 July 2022 and 1 July 2023. The PSA had no prior notice that the announcement was to be made and was unaware of its substance. It had to rely on a media release issued by the Government that day. The proposed increase - 3% per year (inclusive of superannuation), with a possible extra 0.5% in the second year subject to the attainment of productivity reforms - falls well short of the PSA's claim.
13. Also on 6 June 2022, an "offer" was made by the Industrial Relations Secretary to the PSA. I presumed that it was made also on behalf of the other Notifiers, although this was not expressly stated. It was contained in an email sent by a solicitor in the office of the Crown Solicitor to Ms McRobert. Other than suggesting that discussions "be progressed on productivity reforms that would enable a further increase of 0.5% to be applied in 2023-24", the email offered nothing in addition to the media release issued that morning. There was and had never been any suggestion that the Government was open to negotiation with the PSA on the wage increases to be paid to its members. The Notifiers were unable or unwilling to entertain such discussions in these proceedings.
14. This was difficult to comprehend in circumstances where the evidence led by the Notifiers revealed a significant density of PSA membership in the workforce. Indeed, this very density was one of the factors on which the Notifiers relied in seeking dispute orders. I also took notice of the fact that media reports suggest that the Government had been actively engaging in consultation, and presumably negotiations, with at least one other union prior to the announcement on 6 June 2022.
15. I viewed the conduct of the Notifiers in the context of the Act. In addition to the object in s 3(g) of the Act on which the Notifiers relied, the objects of the Act include the following: 3 Objects The objects of this Act are as follows - (a) to provide a framework for the conduct of industrial relations that is fair and just, … (c) to promote participation in industrial relations by employees and employers at an enterprise or workplace level, (d) to encourage participation in industrial relations by representative bodies of employees and employers and to encourage the responsible management and democratic control of those bodies, (e) to facilitate appropriate regulation of employment through awards, enterprise agreements and other industrial instruments, … (h) to encourage and facilitate co-operative workplace reform and equitable, innovative and productive workplace relations.
16. The Notifiers refused to engage meaningfully, or at all, with the PSA on its wages claim. The Government took a stance which anticipated that it would announce the wages outcome, without giving the PSA any opportunity to influence that outcome. The Notifiers then criticised the PSA for not invoking the Commission's jurisdiction in circumstances, firstly, when there was nothing to suggest that they would have been willing to move on their position in any regard, and, secondly, the Commission's powers to resolve the dispute have been significantly curtailed by s 146C of the Act and cl 6 of the Regulation.
17. The outcome sought by the Notifiers would be to permit an entirely one-sided approach to industrial relations in New South Wales. If the demands of the Notifiers were met the Commission would not be providing a framework for the conduct of industrial relations that is fair and just. It would be condoning an approach which discourages participation in industrial relations by employees and their unions. It would do nothing to encourage and facilitate co-operative workplace reform and equitable, innovative and productive workplace relations.
18. I had regard to the PSA's submissions regarding workers' alleged "right to strike". Given that the Commission had before it proceedings that were brought on an urgent basis for dispute orders, this was not the case in which to attempt to postulate a concluded view as to the existence of such a right.
19. Suffice it to say, to the extent that such a "right" exists (if at all), it is clearly and expressly subject to the Act. It could not operate as a fetter on the Commission's powers and discretions under the Act.
20. For the reasons set out above, I determined not to make dispute orders in the terms sought by the Notifiers. However, I was satisfied that more limited dispute orders were appropriate having regard to the evidence led by the Notifiers.
21. There was a significant degree of speculation in the evidence on which the Notifiers relied as to the anticipated impact of the proposed industrial action. To a degree, this was to be expected when there was no absolute certainty as to the density of PSA membership in particular workplaces, the number of employees who would in fact elect to take industrial action, and the extent to which mitigation strategies adopted by the relevant agencies would be effective in ameliorating the effect of the industrial action. That is to say, the Notifiers' evidence was not to be impugned simply because it entailed a degree of opinion and speculation.
22. At the same time, it was clear that a number of the witnesses' evidence was little more than a recitation of information that had been provided to them by others, rather than drawn from their own knowledge of the operations of the relevant agency. Most were unaware of work that had been done "on the ground" between particular agencies and the PSA to ensure that critical operations would not be impacted by the industrial action, as set out in the evidence of Ms McRobert. It followed that I approached the Notifiers' evidence with some caution, particularly to the extent that it could be said to posit a "worst-case scenario".
23. I was satisfied on the evidence that there were certain categories of employees whose absence, even for a day, might impact on the safety or welfare of the public. I was particularly concerned to ensure that young and/or vulnerable people would not be put at risk as a consequence of not having the support on which they rely.
24. In what I might call this "safety and welfare" category I determined to include in the Orders School Learning and Support Officers, Assisted Travel Support Officers [1] , Correctional Officers, employees in Child Protection Services, employees in Youth Justice, employees in the School Crossing Program and employees conducting Heavy Vehicle Inspections.
25. I also determined to include employees working at Recovery Centres. These centres provide support to members of the public affected by the floods in northern New South Wales earlier this year. I considered that the work performed by those centres to support affected members of the public should not be interrupted. I was particularly conscious that a number of the Recovery Centres are only open on a Wednesday (being the day on which the strike was planned to occur) or operated only on Monday, Tuesday and Wednesday.
26. I determined to include School Psychologists in the Order as their award is presently the subject of proceedings before the Commission. With the Commission's jurisdiction having been invoked, I do not consider it appropriate that School Psychologists engage in industrial action. Damian Sloan Commissioner

Endnote

1. In the Orders made ex tempore on 7 June 2022 I referred to "Assisted School Travel Program drivers", inadvertently adopting the term used in a summary of evidence provided by the Notifiers, when the classification was described in the evidence as "Assistant School Travel Officers". In an email received by the Commission on 8 June 2022 the Crown Solicitor, on behalf of the Notifiers, stated that the correct title was in fact "Assisted Travel Support Officers". The Crown Solicitor sought, with the consent of the PSA, that the Orders be varied accordingly. I made the correction pursuant to r 36.17 of the Uniform Civil Procedure Rules 2005.

Amendments 15 June 2022 - Amendment made in Paragraph [34]. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 15 June 2022