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[2020] FWC 224
General information, not legal advice.
Fair Work Commission
2020-01-16
Original judgment source is linked above.
The attached document replaces the document previously issued with the above code on 16 January 2020.
The heading above paragraph 21 contains a typographical error. The word "In" has been deleted and replaced with the word "Is".
s.418 - Industrial action
Orora Packaging Australia Pty Ltd T/A Orora Bag Solutions
Alleged industrial action at Orora Packaging Australia Pty Ltd.
[1] Orora Packaging Australia Pty Ltd T/A Orora Bag Solutions (Orora) has made an application to the Fair Work Commission (Commission) for an order pursuant to s.418 of the Fair Work Act 2009 (FW Act) to stop unprotected industrial action it says is being taken by 31 named individuals (collectively, the Respondents).
[2] The application was made at 9.14pm on Thursday, 9 January 2020. As I could not determine the application within two days as required by s.420 of the FW Act and, being satisfied that it was not contrary to the public interest, I issued an Interim Order[1] in a form slightly amended from that sought by Orora on Friday 10 January 2020.[2]
[3] The application was heard by me on Tuesday, 14 January 2010. Orora was represented by The Australian Industry Group (Ai Group) and the named individuals were represented by the "Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union" known as the Australian Manufacturing Workers' Union (AMWU). The Commission was informed that the Respondents were represented by the AMWU after the notice of listing for hearing the application was issued.
[4] I am satisfied that the Respondents were informed of the s.418 application such that it was not unreasonable for me to hear the matter on 14 January 2020. One of the reasons the matter could not be heard and dealt with any earlier was my concern that the Respondents had not, at the time the application came to me, been given proper notice that the application had been made.
[5] Section 418 of the FW Act states:
418 FWC must order that industrial action by employees or employers stop etc.
(1) If it appears to the FWC that industrial action by one or more employees or employers that is not, or would not be, protected industrial action:
the FWC must make an order that the industrial action stop, not occur or not be organised (as the case may be) for a period (the stop period) specified in the order.
(i) a person who is affected (whether directly or indirectly), or who is likely to be affected (whether directly or indirectly), by the industrial action;
(ii) an organisation of which a person referred to in subparagraph (i) is a member.
(3) In making the order, the FWC does not have to specify the particular industrial action.
(4) If the FWC is required to make an order under subsection (1) in relation to industrial action and a protected action ballot authorised the industrial action:
(a) some or all of which has not been taken before the beginning of the stop period specified in the order; or
(b) which has not ended before the beginning of that stop period; or
the FWC may state in the order whether or not the industrial action may be engaged in after the end of that stop period without another protected action ballot.
[6] As is evident from the wording of s.418(1) it is not necessary that the industrial action meet all three of the pre-requisites for the issue of an order but only that it meet one.
[7] In order to determine this application it is necessary for me to determine:
ii. If the action that is occurring is industrial action;
iii. If it is industrial action if it is protected industrial action;
[8] Orora called evidence from:
Mr Greg Aldous, General Manager, Orora Bag Solutions Business;
Mr Saad Kanno, Value Stream Manager, Orora Bag Solutions Business;
Brian Hu, Value Stream Manager, Orora Bag Solutions Business;
Michael Fretwell, Operations Manager, Orora Bag Solutions Business.
[9] The Respondents did not give evidence or call any witnesses.
[10] It is not in dispute that there is protected industrial action being taken at Orora by members of the AMWU pursuant to a protected action ballot. That action has been occurring since 22 October 2019 and currently involves one hour stoppages on each shift (day, afternoon and night shifts) along with a periodic ban on scanning for dispatch finished goods.
[11] By way of relevant background Mr Aldous gave undisputed evidence that:
Orora operates on the basis of "operating lines" which normally work 24 hours a day for 5 days per week. The key production lines for bags for dairy powder are Lines 4 and 5. These two Lines operate independently but in the same way. Some products can be manufactured on either line but some 25% can only be produced on Line 4 or Line 5.
Each Line has two sections - one responsible for the body of a bag (the tuber) and the other for the base (bottomer). The tuber and bottomer run independently but both sections need to be operational at the same time although small interruptions can be accommodated.
The tuber and bottomer section each have two lead operators and an operator making up six crew per Line per shift. Line 5 operates 3 shifts while Line 4 operates day and afternoon shift only.
There are key operators on each Line responsible for the set up and operation of each section. They are also responsible for the number, format and quality of bags in accordance with the production schedule.
When key operators are absent a Line cannot run. Absences of key operators for annual and personal leave are normally covered by other shifts on overtime. Absences for non-key operators are normally covered within a shift or from other shifts with overtime although a shift may "run short" with four instead of six operators.
Overtime is currently not available because of the protected industrial action.
Of the 31 named Respondents to the application 16 are key operators
[12] Mr Aldous gave evidence that, since 22 October 2019 until the date of his statement (13 January 2020) there has been a "significant increase in employees accessing sick leave"[3] with the increased absences having a detrimental effect on operations. An analysis of the absences showed that dairy Line 4 and Line 5 had been particularly targeted by the absences.
[13] Mr Aldous produced uncontested evidence that compared lost production hours due to employee access to personal leave for October, November and December 2018 compared to the same months in 2019. That data showed no lost production hours due to personal leave in any of the three months in 2018 but 64 hours, 200 hours and 184 hours in October, November and December 2019 respectively.
[14] Mr Aldous also gave evidence that absenteeism has increased by over 100% year on year on Line 4 and Line 5 with absenteeism on Line 5 increasing by over 300% year on year
[15] Mr Aldous exhibited to his witness statement a table showing the pattern of absences on sick, carer's and annual leave and the Lines that had shut down due to the absences. He gave evidence that multiple absences had occurred on the same day "often involving employees with a single day absence only" on 24 October 2019, 25 October 2019, 1 November 2019, 24 December 2019, 31 December 2019 and 2 January 2020. Further, his evidence is that absences of key operators on the same Line were occurring on the same day (e.g. El-Chami and Cuthers are key operators on Line 5 Tuber on night shift; Todorovic and Francisco Line 5 bottomer on night shift; Chen and Husidic Line 5 Bottomer section afternoon shift and Nappa and Owen Line 5 Bottomer day shift[4]). Further, Mr Aldous said that both Chen and Husidic had sick leave on the same day on 10 January 2020[5] (not reflected in the spreadsheet) during the period of the Interim Order.
[16] The protected industrial action involving the overtime ban means that absences cannot be covered by overtime. Further, employees have refused to cover absences by running short.
[17] Mr Aldous said that the absences, in conjunction with the protected industrial action, has meant that multiple shifts have been lost resulting in losses to the company. Mr Aldous said that in his time with the business he has not experienced the levels of personal leave currently being observed and has never seen a shift lost for such a reason.
[18] Further absences have occurred since the data compiled in attachment GA-1 to Mr Aldous' statement and was set out in a further document exhibited by Mr Aldous.
[19] Orora submitted that the evidence of Mr Aldous shows trends and patterns in the taking of sick leave. Further, it submitted that, in the absence of any evidence to the contrary from the Respondents, I could reasonably infer that covert industrial action in the form of co-ordinated sick leave was occurring.
[20] I am satisfied on the basis of the evidence before me that there is currently action occurring in the form of planned and co-ordinated taking of sick leave by employees on Line 4 and Line 5 at Orora. The data shows an extraordinary number of absences for sick leave on the same days. Absent any evidence to the contrary or denial by the Respondents I am satisfied that the absences are co-ordinated and form a concerted campaign against Orora.
[21] Industrial action is defined at the FW Act as follows:
(1) Industrial action means action of any of the following kinds:
(a) the performance of work by an employee in a manner different from that in which it is customarily performed, or the adoption of a practice in relation to work by an employee, the result of which is a restriction or limitation on, or a delay in, the performance of the work;
(b) a ban, limitation or restriction on the performance of work by an employee or on the acceptance of or offering for work by an employee;
(c) a failure or refusal by employees to attend for work or a failure or refusal to perform any work at all by employees who attend for work;
(d) the lockout of employees from their employment by the employer of the employees.
Note: In Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union v The Age Company Limited, PR946290, the Full Bench of the Australian Industrial Relations Commission considered the nature of industrial action and noted that action will not be industrial in character if it stands completely outside the area of disputation and bargaining.
(2) However, industrial action does not include the following:
(a) action by employees that is authorised or agreed to by the employer of the employees;
(b) action by an employer that is authorised or agreed to by, or on behalf of, employees of the employer;
(i) the action was based on a reasonable concern of the employee about an imminent risk to his or her health or safety; and
(ii) the employee did not unreasonably fail to comply with a direction of his or her employer to perform other available work, whether at the same or another workplace, that was safe and appropriate for the employee to perform.
(3) An employer locks out employees from their employment if the employer prevents the employees from performing work under their contracts of employment without terminating those contracts.
Note: In this section, employee and employer have their ordinary meanings (see section 11).
[22] In Hillsbus Co. Pty Ltd v Bajwa & Others[6] Commissioner Cambridge considered whether a collective personal leave campaign was industrial action as defined by the FW Act. Commissioner Cambridge determined that covertly organised collective sick leave could be held to be industrial action.[7]
[23] In AGL Loy Yang Pty ltd T/A AGL Loy Yang v Construction, Forestry, Mining and Energy Union and Another[8] Commissioner Roe concluded that unprecedented levels of sick leave did amount to industrial action.
[24] In this case the evidence is clear and I am satisfied that the levels of sick leave are unprecedented. I am also satisfied that the absences on sick leave are coordinated and that it amounts to industrial action as defined in the FW Act in that it is a practice, the result of which is a limitation on or delay in the performance of work.
[25] The Respondents had an adequate opportunity to provide evidence as to the cause and purpose of their absences. That they may have provided medical certificates or statutory declarations in support of their absences does not alter the character of the action taken. If it is the case that the Respondents were told nothing could be done if they had a medical certificate to cover their absences then they were misinformed.
[26] I am satisfied that the action being taken at Orora does not fall within the exemption to the definition of industrial action.
[27] I am therefore satisfied that the action in the form of co-ordinated sick leave is industrial action.
[28] I am not satisfied that the industrial action is protected industrial action and no submission to this effect has been put to me.
Is the industrial action happening; threatened, impending or probable; or being organised?
[29] The evidence of Mr Aldous was that between 7 and 13 January 2020 seven days of sick leave were taken and one day of unauthorised leave between six employees. Petereski and Petkovski both took 7 and 8 January 2020 on sick leave, Chen and Husidic (both key operators on Line 5 bottomer on afternoon shift) were absent on 10 January and Alacevski and Tran were absent on 13 January suggesting that some co-ordination of the taking of sick leave continued in the week of the application being made. This suggests that the unprotected industrial action was happening.
[30] Given the absence of any evidence to the contrary I am satisfied that I can reasonably infer the coordinated absences from work of the Respondents on Lines 4 and 5 at Orora was being organised and, in all likelihood, continues to be organised.
[31] The trend of absences and the effect of these absences over the last 3 months of 2019 along with the absences in January 2020, including after the Interim Order had been issued, satisfies me that that unprotected industrial action is threatened, impending or probable. Absent any evidence by the Respondents and given the history of absences, a continuation of the action may well occur.
[32] I am therefore satisfied that the requirements of s.418 of the FW Act have been met.
[33] The AMWU submitted that the Respondents are each prepared to give an undertaking that they shall not "organise or participate in any industrial action in the form of systemic taking of personal leave." On this basis, in conjunction with a failure of Orora to demonstrate that the Respondents have made any "unusual" claims for personal leave, the AMWU submits that I should not issue an Order.
[34] Orora oppose the resolution of this matter by an undertaking. In any event it seems to me that, having reached the requisite satisfaction that the action is threatened, impending or probable, s.418 of the FW Act does not provide me with any discretion. Section 418 requires that the FWC must make an order that the action stop, not occur or not be organised. Having reached this conclusion it is not necessary for me to consider any other matters.
[35] Orora seeks that the final order be in the form of the Interim Order and that it operate for three months. Beyond seeking that the matter be resolved by way of undertaking and submitting that the Commission cannot be satisfied as to the requirements in s.418 of the FW Act the Respondents make no submissions as to the form of the final order.
[36] I shall therefore issue a final order in the form slightly changed from that of the Interim Order. I have deleted from the Order that Orora is not to pay the Respondents for the period of the industrial action. I am not convinced this belongs in an order directed to employees but, in any event, I am sure that Orora is aware of its legal obligations in this regard. The order also makes clear that it is directed to the industrial action in the form of the systematic taking of sick leave (and not other, protected, industrial action). I have also determined that three months is too long in circumstances where it is now abundantly clear to employees that the provision of a certificate or other evidence is not enough to shield them from the provisions of the FW Act. I will however issue the final order for a period of two months.
[37] A final order[9] will be issued in conjunction with this decision.
[2] The placement of the Interim Order on the notice board was rejected by me as it was not apparent that the employees were at work such that they might become aware of the Interim Order. Rather Orora was required to deliver the Interim order to each of the Respondents.
[4] Exhibit A1, paragraph 43 and attachment AG-1.
Printed by authority of the Commonwealth Government Printer
Orora Packaging Australia Pty Ltd T/A Orora Bag Solutions
Ahmad