In the recent decision of AMWU & AWU v Premium Wine Brands Pty Limited [2011] FWA 1328, Fair Work Australia (FWA) ordered a Protected Ballot Action Order (PABO) for the unions to take protected industrial action in circumstances where excessive wage claims were made.

The facts

The Australian Manufacturing Workers Union (AMWU) and the Australian Workers Union (AWU) applied to FWA for a PABO after failing to reach agreement, including a significant initial wage increase plus a 5% increase per year for the life of the proposed agreement.

Premium Brands operates a major wine producing and manufacturing facility in the Barossa Valley in South Australia. The current enterprise agreement expired on 28 February 2007.  The applicant unions wrote to Premium Brands in May 2010 looking to bargain for a new enterprise agreement.

After issuing the Notice of Employee Representational Rights, meetings were held between the parties and a number of in principle agreements were reached around particular matters. However, some key threshold issues between the parties remained unresolved, including wage increases, rostered days off and disciplinary procedure.

Premium Brands challenged the authenticity of the applicant unions' motivation and intentions for seeking the PABO, in particular:

  • There was some early dispute around the representation of the AMWU and that the union had not acted appropriately in that regard.
  • The wage claims made by the applicant unions were excessive and that there had been no compromise from the employer's counterproposal.
  • The applicant unions had failed to inform the employer that they were going to seek a PABO.
  • There was an apparent attempt by the applicant unions to punish Premium Brands as part of the positioning of the unions within the negotiations.

Ultimately, the employer argued that the PABO applications were premature and that negotiations on key points were not yet exhausted.

The decision

Commissioner Hampton found that a failure to make concessions (even in circumstances of excessive wage claims) or to reach agreement is not in itself a lack of 'good faith' as defined in the Fair Work Act 2009 (Cth) (FW Act).  The fact that the applicant unions and their members have a different view to the employer on the appropriate future wage outcome is a matter for bargaining.

In granting the applicant union's PABO, Commissioner Hampton went on to say that it well may be that the unions have adopted a more robust position in these negotiations than in the past, however even if that is the case, this is not indicative of a lack of genuine desire to make an agreement.

Under the FW Act, even where a PABO is granted and subsequent protected industrial action is then taken, parties remain subject to the statutory good faith bargaining obligations.

For more information, please contact:

Allan Drake-Brockman, National Practice Group Leader & Partner
Workplace Relations, Employment and Safety
Tel +61 8 6467 6205
allan.drake-brockman@dlaphillipsfox.com

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