Jessup J
1 This is an application by J.J. Richards & Sons Pty Ltd and Australian Mines and Metals Association Inc for writs of certiorari and mandamus in respect of two decisions made by Fair Work Australia ("FWA") under the Fair Work Act 2009 (Cth) ("the Act") on 16 February and 1 June 2011. The Court has jurisdiction under s 562 of the Act, which jurisdiction is to be exercised by a Full Court pursuant to s 20(2) of the Federal Court of Australia Act 1976 (Cth) since, in its decision of 1 June 2011, FWA was constituted by members who included a Judge of the Court. FWA filed a submitting appearance, the case in opposition to the relief sought by the applicants being advanced by the Transport Workers' Union of Australia ("the Union").
2 On 16 February 2011, a single member of FWA made a "protected action ballot order" under s 443 of the Act. That order activated provisions of the Act which, in effect, permitted employees of the employer represented by the Union to take industrial action free of certain restrictions which the civil law would, or might, otherwise impose. On 1 June 2011, a Full Bench of FWA dismissed an appeal from the making of that order. I shall refer to the terms of s 443 in due course, but the essence of the applicants' point in their applications for certiorari and mandamus is that FWA misconstrued the terms of that section, and regarded itself as subject to a statutory obligation to make the order when, according to the applicants, there was, if the section were properly construed, a statutory prohibition upon the making of the order. Their point was that no such order could be made by FWA unless the employees concerned and their employer had commenced the process of collective bargaining, which had not occurred on the facts of the present case. If the applicants' construction point is correct, they would undoubtedly (subject to such discretionary considerations as may arise) have made good their case for certiorari.
3 According to the applicants' case, the correct construction of s 443 is to be found not merely in the words of the section itself, but in other provisions of the Act which establish the setting in which a protected action ballot order might be sought, and made. They submitted that, only by an understanding of those provisions, and a proper perception of the system of collective bargaining for which they provide, can the true scope, and the limits, of s 443 be ascertained. It is, therefore, useful to commence with a reference to those other provisions, and to the collective bargaining system to which the applicants refer.
4 As identified in s 3 of the Act, the object of the Act includes the following:
The object of this Act is to provide a balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians by:
….
(f) achieving productivity and fairness through an emphasis on enterprise-level collective bargaining underpinned by simple good faith bargaining obligations and clear rules governing industrial action; ….
The goals identified in this para (f) are sought to be achieved in two separate chapters of the Act. The provisions which relate to enterprise-level collective bargaining and good faith bargaining obligations are to be found in Ch 2 of the Act, while those which set out the clear rules governing industrial action are to be found in Ch 3 of the Act.
5 The enterprise agreement, and bargaining, provisions of the Act are set out in Pt 2-4 thereof. The objects of that part are as follows (as stated in s 171):
The objects of this Part are:
(a) to provide a simple, flexible and fair framework that enables collective bargaining in good faith, particularly at the enterprise level, for enterprise agreements that deliver productivity benefits; and
(b) to enable FWA to facilitate good faith bargaining and the making of enterprise agreements, including through:
(i) making bargaining orders; and
(ii) dealing with disputes where the bargaining representatives request assistance; and
(iii) ensuring that applications to FWA for approval of enterprise agreements are dealt with without delay.
It is manifest that enterprise agreements are a significant, if not the predominant, means adopted by the Act for the establishment of terms and conditions of employment, and that collective bargaining, required to be in good faith, is the means by which such agreements come to be made.
6 The Act provides for enterprise agreements to be made in various situations, but for present purposes it will be sufficient to note that s 172(2)(a) deals with the situation of an established employer with an established enterprise, and enables that employer to make an enterprise agreement with the employees who are employed at the time the agreement is made, and who will be covered by the agreement. Save in the case of an agreement which relates to "a genuine new enterprise", there appears to be no scope for an employer to make an enterprise agreement with an employee organisation such as the Union. That circumstance, as it seems to me, immediately gives rise to the need for the Act to address the question of how the employees will be represented in the process which presumptively leads to the making of an enterprise agreement.
7 That need is addressed in Div 3 of Pt 2-4 of the Act, headed "Bargaining and representation during bargaining". Although concerned predominantly with the representation of employees during bargaining, Div 3 commences with an obligation imposed upon the employer. Subsections (1), (2) and (3) of s 173 of the Act provide as follows:
Employer to notify each employee of representational rights
(1) An employer that will be covered by a proposed enterprise agreement that is not a greenfields agreement must take all reasonable steps to give notice of the right to be represented by a bargaining representative to each employee who:
(a) will be covered by the agreement; and
(b) is employed at the notification time for the agreement.
Notification time
(2) The notification time for a proposed enterprise agreement is the time when:
(a) the employer agrees to bargain, or initiates bargaining, for the agreement; or
(b) a majority support determination in relation to the agreement comes into operation; or
(c) a scope order in relation to the agreement comes into operation; or
(d) a low-paid authorisation in relation to the agreement that specifies the employer comes into operation.
When notice must be given
(3) The employer must give the notice as soon as practicable, and not later than 14 days, after the notification time for the agreement.
The word "bargain", and grammatical derivatives of that word as such, are not defined in the Act. Neither, so far as I can see, is there any definition of what constitutes the initiation of bargaining, for the purposes of s 173(2)(a). Content is, however, given to paras (b), (c) and (d) of s 173(2) in other provisions of the Act.
8 Division 8 of Pt 2-4 is headed "FWA's general role in facilitating bargaining". The subject of Subdiv C thereof is "Majority support determinations and scope orders". Section 236(1) provides that a bargaining representative of an employee who will be covered by a proposed single-enterprise agreement may apply to FWA for determination "that a majority of the employees who will be covered by the agreement want to bargain with the employer …". Section 237 sets up the circumstances under which FWA must make such a determination. Foremost amongst the matters of which FWA must be satisfied in this regard is that a majority of the employees who are employed by the employer, at a time determined by FWA, and who will be covered by the agreement, want to bargain. FWA must also be satisfied that the employer has not yet agreed to bargain, or initiated bargaining, for the agreement.
9 Sections 238 and 239 of the Act deal with the subject of "scope orders". A bargaining representative for a proposed single-enterprise agreement may apply to FWA for a scope order if he or she "has concerns that bargaining for the agreement is not proceeding efficiently or fairly" and the reason is that, in the view of the representative, "the agreement will not cover appropriate employees, or will cover employees that it is not appropriate for the agreement to cover". If a case is made out, FWA may make a scope order which specifies the employer, and the employees, who will be covered by the enterprise agreement.
10 Returning to s 173(2) of the Act, para (d) thereof is concerned with low-paid authorisations, a specific area covered by Div 9 of Pt 2-4 of the Act. Under s 242, either a bargaining representative or a relevant organisation may apply to FWA for a low-paid authorisation and, if made, such an authorisation must specify the employers and employees to be covered by the proposed enterprise agreement, and any other matter "prescribed by the procedural rules" (s 243(4)). These provisions were not said to have any relevance to the facts of the case before the Court. So far as I can see, they make no additional contribution to the exercise of construction with which we are presently concerned.
11 Other provisions of Div 3 of Pt 2-4 deal with the appointment of bargaining representatives. Although, as I have said, that subject is central to the operation of Pt 2-4 in the context of an employer in an established enterprise, nothing further needs to be said about it for present purposes.
12 Section 228, in Div 8 of Pt 2-4 of the Act, specifies what are the "good faith bargaining requirements" for those involved in bargaining towards the making of an enterprise agreement. They are:
(a) attending, and participating in, meetings at reasonable times;
(b) disclosing relevant information (other than confidential or commercially sensitive information) in a timely manner;
(c) responding to proposals made by other bargaining representatives for the agreement in a timely manner;
(d) giving genuine consideration to the proposals of other bargaining representatives for the agreement, and giving reasons for the bargaining representative's responses to those proposals;
(e) refraining from capricious or unfair conduct that undermines freedom of association or collective bargaining;
(f) recognising and bargaining with the other bargaining representatives for the agreement.
13 Under s 229, a bargaining representative may apply to FWA for a bargaining order in relation to a proposed enterprise agreement. Such an order is to be made upon FWA being satisfied of a number of things, including, in s 230(2), that one of the following applies:
(a) the employer or employers have agreed to bargain, or have initiated bargaining, for the agreement;
(b) a majority support determination in relation to the agreement is in operation;
(c) a scope order in relation to the agreement is in operation;
(d) all of the employers are specified in a low-paid authorisation that is in operation in relation to the agreement.
It will be seen that these requirements correspond with the provisions of s 173(2) of the Act, set out above.
14 Under s 231 of the Act, a bargaining order must specify -
(a) the actions to be taken by, and requirements imposed upon, the bargaining representatives for the agreement, for the purpose of ensuring that they meet the good faith bargaining requirements;
(b) requirements imposed upon those bargaining representatives not to take action that would constitute capricious or unfair conduct that undermines freedom of association or collective bargaining;
(c) the actions to be taken by those bargaining representatives to deal with the effects of such capricious or unfair conduct;
(d) such matters, actions or requirements as FWA considers appropriate, taking into account subparagraph 230(3)(a)(ii) (which deals with multiple bargaining representatives), for the purpose of promoting the efficient or fair conduct of bargaining for the agreement.
Thus, although "bargaining" is not defined in the Act in terms, s 231 effectively leaves it to FWA, in a case to which the section applies, to specify what will constitute bargaining, and what must be done by the parties who bargain, in any particular situation.
15 The assumption made by the Act is that the outcome of successful bargaining will be the making of an enterprise agreement. By s 182(1), at least relevantly to the facts of the present case, an enterprise agreement is "made" when it is approved by a majority of the relevant employees who cast a valid vote in favour of approval. That process is conditioned upon there first having been a request by the employer under s 181 for the employees to approve the proposed agreement, before which the employer must, under s 180, take all reasonable steps to ensure that the employees to be covered by the agreement are given a copy of the written text of the agreement, and any other material incorporated by reference therein. These provisions also include procedural details and requirements, to which it is not necessary to refer for present purposes.
16 Once an agreement has been made, a bargaining representative must apply to FWA for approval of the agreement, pursuant to s 185. Section 186 sets out comprehensively the facts and matters of which FWA must be satisfied before approving the agreement, the detail of which, again, does not need to be rehearsed. By s 54(1) of the Act, an enterprise agreement approved by FWA commences to operate seven days after approval, or, if a later day is specified in the agreement, on that later day.
17 By s 50 of the Act, a person must not contravene a term of an enterprise agreement. By item 4 of the table in s 539(2) of the Act, s 50 is a "civil remedy provision" contravention of which is, by s 546 of the Act, subject to a "pecuniary penalty".
18 According to the heading, Ch 3 of the Act deals with the "Rights and responsibilities of employees, employers, organisations etc", and Part 3-3 thereof deals with "Industrial action". Industrial action as such is not proscribed by the Act, but, by s 418, if it appears to FWA that industrial action is happening, is threatened, impending or probable, or is being organised, FWA must make an order that the industrial action stop, not occur or not be organised for a period specified in the order. However, such an order is not to be made in the case of industrial action that is, or would be, "protected industrial action". Further, by s 415 of the Act, no action lies under any law in force in a state or territory in relation to "protected industrial action" unless that action has involved, or is likely to involve, personal injury, the wilful or reckless destruction of, or damage to, property or the unlawful taking, keeping or use of property. This is not, of course, a complete description of the legislative provisions to which I have referred, it being sufficient for present purposes to note that the status of industrial action as "protected industrial action" has important consequences.
19 What is "protected industrial action" is the subject of s 408 of the Act. Industrial action which is for a "proposed enterprise agreement" and is either "employee claim action for the agreement", "employee response action for the agreement", or "employer response action for the agreement", is protected industrial action. Sections 409, 410 and 411 give content to the terms I have enclosed in inverted commas in the previous sentence. Again, there is no need to refer to the detail of these provisions: it is sufficient for present purposes to note that industrial action will never be "protected industrial action" if it does not relate, in the statutory sense, to a proposed enterprise agreement.
20 Before particular industrial action will qualify as protected industrial action, it must satisfy certain requirements specified in the Act, including the "common requirements" set out in s 413. Amongst those are the requirements set out in subs (3) thereof, as follows:
(3) The following persons must be genuinely trying to reach an agreement:
(a) if the person organising or engaging in the industrial action is a bargaining representative for the agreement - the bargaining representative;
(b) if the person organising or engaging in the industrial action is an employee who will be covered by the agreement - the bargaining representative of the employee.
21 Where the industrial action is "employee claim action" (as was the situation in the present case), "the industrial action must be authorised by a protected action ballot …": s 409(2). The conduct and outcome of such a ballot is the subject of Div 8 of Part 3-3 of the Act. The object of that division is set out in s 436 as follows:
The object of this Division is to establish a fair, simple and democratic process to allow a bargaining representative to determine whether employees wish to engage in particular protected industrial action for a proposed enterprise agreement.
By s 437, a bargaining representative of an employee who will be covered by a proposed enterprise agreement may apply to FWA for an order requiring a protected action ballot to be conducted to determine whether employees wish to engage in particular protected industrial action for the agreement. This is referred to as a "protected action ballot order". Section 437 specifies, in some detail, the matters that must be set out in an application for a protected action ballot order. Section 438 imposes certain restrictions on when an application for such an order may be made. Section 441 requires FWA to determine, so far as practicable, an application for such an order within two working days after the application is made.
22 The obligation of FWA in dealing with an application for a protected action ballot order is set out in s 443 of the Act, as follows:
(1) FWA must make a protected action ballot order in relation to a proposed enterprise agreement if:
(a) an application has been made under section 437; and
(b) FWA is satisfied that each applicant has been, and is, genuinely trying to reach an agreement with the employer of the employees who are to be balloted.
(2) FWA must not make a protected action ballot order in relation to a proposed enterprise agreement except in the circumstances referred to in subsection (1).
(3) A protected action ballot order must specify the following:
(a) the name of each applicant for the order;
(b) the group or groups of employees who are to be balloted;
(c) the date by which voting in the protected action ballot closes;
(d) the question or questions to be put to the employees who are to be balloted, including the nature of the proposed industrial action.
(4) If FWA decides that a person other than the Australian Electoral Commission is to be the protected action ballot agent for the protected action ballot, the protected action ballot order must also specify:
(a) the person that FWA decides, under subsection 444(1), is to be the protected action ballot agent; and
(b) the person (if any) that FWA decides, under subsection 444(3), is to be the independent advisor for the ballot.
(5) If FWA is satisfied, in relation to the proposed industrial action that is the subject of the protected action ballot, that there are exceptional circumstances justifying the period of written notice referred to in paragraph 414(2)(a) being longer than 3 working days, the protected action ballot order may specify a longer period of up to 7 working days.
It is this provision, and para (b) of subs (1) in particular, which has become controversial in the present case.
23 On the facts of that case, a bargaining representative, regularly attending to the interests of the employees represented, sought to bargain with the first applicant for the making of an enterprise agreement. The first applicant declined to do so. It neither agreed to bargain nor initiated bargaining within the meaning of s 173(2)(a). Neither was there a majority support determination or a scope order in operation, with the consequence that a bargaining order could not be made under s 230 of the Act. In the result, bargaining did not take place.
24 In the circumstances, the bargaining representative of the employees made application for a protected action ballot order under s 437 of the Act and, after an earlier false start to the circumstances of which no further reference needs to be made, FWA made such an order on 16 February 2011. That order was confirmed on appeal by the decision of the Full Bench published on 1 June 2011. At first instance, the Commissioner of FWA held that the bargaining representative had been, and was, genuinely trying to reach agreement with the first applicant, within the meaning of s 443(1)(b) of the Act. The Full Bench held that that finding was open to the Commissioner, and did not disturb it. It was the factual premise by reference to which the present application was prosecuted. The applicants contended, however, that that was not enough. They say that, as a matter of construction, an order under s 443 cannot be made unless bargaining has commenced. They say that the special statutory protections given to industrial action are intended to "underpin" (to use the metaphor in s 3(f)) collective bargaining, and not to be available generally whenever a bargaining representative genuinely wants to reach agreement with an employer.
25 The applicants put the same constructional case to the Full Bench of FWA. That case was rejected. Dealing with s 443(1)(b) of the Act, the Full Bench commenced by taking what it described as "the orthodox approach to the construction of a statute", namely, "to commence with the words in question, paying regard to their context and such assistance as may be gained from other relevant parts of the enactment and then, possibly, [considering] any extrinsic material". The Full Bench noted that, on their ordinary meaning, the critical words of s 443(1)(b) required only that the applicant for an order under that section be genuinely trying to reach agreement, and provided no support for the suggestion that the power to make the order was conditioned upon the commencement of bargaining. The Full Bench then canvassed other provisions of the Act which dealt with the subject of bargaining, and noted that the only terms of art used by the Act were of the employer agreeing to bargain, or of the employer initiating bargaining. These two formulae appeared in a number of places in the Act, and, in the view of the Full Bench, it was striking that neither of them appeared in s 443. That was "a strong indication that no such condition is to be applied".
26 Dealing with the arguments of the first applicant and others then supporting it in relation to the context provided by the legislative scheme generally, the Full Bench saw nothing in that context which would compel a construction of s 443 which conditioned its operation upon bargaining having commenced. In all but one of these respects, the approach which the Full Bench took was conventional, thorough, and, in my respectful view, manifestly correct.
27 One respect in which I have a reservation as to the constructional approach taken by the Full Bench relates to the significance of the good faith bargaining requirements, and of bargaining orders, under Subdiv A of Div 8 of Pt 2-4 of the Act. I have referred to the relevant provisions above. In this regard, the Full Bench said (referring to an argument advanced on behalf of the first applicant):
We turn to the argument that protected action should not be available before the good faith bargaining requirements in s.228 apply. Accepting, but without deciding, that such is the effect of the provisions, it may be that the legislature intended that result. An important assumption which appears to underlie the argument is that an applicant for a bargaining order should not be permitted to organise protected industrial action to persuade an employer to come to the bargaining table. There is no basis for that assumption. Yet the effect of the interpretation advanced by the appellants is that an applicant which is genuinely trying to reach agreement with an employer is unable to exercise a right, which on any objective reading s.443(1) clearly confers, to obtain a protected action ballot order.
A little later in its reasons, the Full Bench repeated its conclusion that there was "nothing in the legislative provisions to suggest that a bargaining representative should not be permitted to organise protected industrial action to persuade an employer to agree to bargain".
28 With respect, I would depart from the Full Bench at this point. On my reading of the Act, there is a means by which a party seeking to bring an employer to the bargaining table may achieve that result without taking industrial action. That means is provided in Subdiv A of Div 8. As I have indicated, the legislation eschews any definition of "bargaining", leaving it to FWA itself to specify what might be required in a particular situation. It is true that, under s 230(2), where the employer has not agreed to bargain or initiated bargaining, there must be a majority support determination or a scope order in operation. These requirements, however, may be seen as a conscious choice by the legislature to introduce a degree of organisation into the representation of employees' interests, before an unwilling employer might be made the subject of a bargaining order. The important point is that, although limited to an extent, the legislature has, both specifically and in some detail, turned its mind to the means by which an unwilling employer might, to use the Full Bench's metaphor, be persuaded to come to the bargaining table. Although not so stated in terms, it would be at least consistent with these provisions of Subdiv A of Div 8 to perceive a legislative assumption that recourse to industrial action would not be an available means to oblige an employer, or any other party, to commence bargaining.
29 Additionally to the matters to which I have just referred, I consider there is much to be said for the applicants' case, as a matter of broad statutory purpose. The Act provides a detailed, carefully-structured, regulatory environment for the making of enterprise agreements, and for the maintenance of the integrity of the system of collective bargaining which conventionally leads to such agreements. In the sense that protected industrial action must, necessarily, relate to a proposed enterprise agreement (see s 408), it is legitimate to point out, as the applicants did in their submissions, that the ability to take protected industrial action is to be seen as part and parcel of the statutory regime for bargaining in pursuit of, or in resistance to, the making of such agreements. This way of looking at the legislation is amply justified by the parliament's own words in identifying the object of the Act: see s 3(f).
30 However, notwithstanding that perception, and notwithstanding my disagreement, in one important respect, with the reasons of the Full Bench, it is not possible to construe s 443(1)(b) as the applicants would propose. I agree with the Full Bench that the contrast between the references to bargaining in Pt 2-4 of the Act, and the words actually used in s 443(1)(b) is striking. I accept that, under s 15AA of the Acts Interpretation Act 1901 (Cth), an interpretation should be favoured which would best achieve the purpose or object of the legislation. That is no basis, however, for the introduction of additional requirements or conditions which might have been, but which have not been, enacted. There is every reason to perceive in s 443(1)(b) a departure from the scheme of regulated bargaining set out by Pt 2-4 of the Act and, in that sense, there is a certain tension with the object referred to in s 3(f). Such a perception, however, would relate to the consistency of the implementation of legislative policy. It would contribute little or nothing to the task of construction which confronted the Full Bench.
31 In sum, the applicants' case really amounts to no more than the proposition that the legislature ought, consistent with the structure and policy of the Act as a whole, have conditioned the power to make an order under s 443 upon the circumstance of bargaining having commenced. However, that was a step which the legislature did not take, and it is a step which FWA could not take. There was no jurisdictional error in the protected action ballot order made by FWA on 16 February 2011 and confirmed by the Full Bench on 1 June 2011.
32 For the above reasons, I would dismiss the application. Counsel for the Union having made it clear that no question would arise under subs (2) of s 570 of the Act, there can be no order as to costs.
I certify that the preceding thirty-two (32) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Jessup.