Union officials purporting to act in their "private and personal capacity" as bargaining representatives
The Full Bench of Fair Work Australia recently confirmed the position that only in very qualified circumstances can union officials be appointed as a bargaining representative in their "personal and private capacity" to represent employees over which their union does not have constitutional (membership) coverage.
DLA Piper acted for Gravity Crane Services Pty Ltd in October 2010 (1) ("Gravity Case") successfully arguing that an official of the Maritime Union of Australia ("MUA") (Douglas Heath) could not be a bargaining representative in his so-called "personal and private capacity" for onshore crane drivers in the north-west of Western Australia.
The Gravity Case involved an application by Heath for a Majority Support Determination ("MSD"). Gravity received notification that Heath had been appointed as the bargaining representative for 12 crane operators and riggers, and these employees wished to bargain for a new agreement. Gravity objected to the MSD on the basis that Heath was not eligible to be a bargaining representative and therefore was not able to make an application for the MSD. Gravity contended that Heath as an organiser employed by the MUA did not have the right to represent the crane operators and riggers when in fact another union did.
The Full Bench recently confirmed this position in Technip Oceania Pty Ltd v W. Tracey  FWAFB 6551 ("Technip Case"). In the Technip Case the Assistant Branch Secretary of the MUA (WA), Will Tracey, had been appointed a bargaining representative by Technip's Remotely Operated Vehicle Operators ("ROV"). Technip refused to recognise Tracey as a bargaining representative as it was not the MUA but the Australian Maritime Officers Union ("AMOU") who were entitled to represent the employees in accordance with the union rules. Tracey was successful in obtaining a bargaining order at first instance from Commissioner Cloghan, ordering Technip to recognise him as a bargaining representative and deal with him in good faith. Technip subsequently appealed the decision.
In both cases the MUA officials purported to act in their "personal and private capacity" as distinct from their role as an employed union official to represent the workers that the MUA did not have constitutional (membership) coverage over.
Section 176(3) of the Fair Work Act 2009 (Cth) ("FW Act") provides that an employee organisation cannot be a bargaining representative of an employee unless the organisation is entitled to represent the industrial interests of the employee in relation to the work that will be performed under the agreement.
In the Gravity Case Deputy President McCarthy found that it was not reasonable in all the circumstances to order the MSD. His Honour was not convinced by Heath's testimony that the relationship between Heath's obligations as an employee of the MUA and the role he would be performing (by him) representing the employees concerned. Furthermore there was no satisfactory explanation regarding the role of the MUA, if any, or the reasons it was allowing Heath to act in a "private and personal capacity". His Honour held that the objects of the FW Act should be viewed in the context of the Fair Work (Registered Organisations) Act 2009 (Cth) which clearly outlines Parliament's intentions regarding union coverage of types of employment and the regulation of that coverage in order to avoid demarcation disputes.
Similarly in the Technip Case the majority judgment of President Justice Giudice and Commissioner Blair (Drake SDP dissenting) found that while on its face the application had been made by Tracey as an individual the address and contact details used by Tracey were those of the MUA. The majority judgment held that in light of the documentary material and the absence of any cogent countervailing evidence the inference should be drawn that in making the application, Tracey was acting as an official of the MUA. Because the MUA is incapable of representing the industrial interests of the ROV operators the application was invalid.
Implications for business
History tells us that demarcation disputes between unions can be incredibly disruptive and can have significant impacts on business.
Unions have a suite of mechanisms under the FW Act which seek to force employers to enter into negotiations for an enterprise agreement. These include MSDs, bargaining orders, scope orders and protected action ballot orders. A prudent employer should always be wary of the qualifications placed on the various applications for FWA orders sought by unions. In particular employers should have an awareness of the union's constitutional (membership) coverage over the employees for the proposed enterprise agreement.
Union constitutional rules are particularly convoluted and ambiguous as a result of numerous union amalgamations that have occurred over the last 30 years. The interpretation of union rules has been the subject of numerous High Court decisions.
Effectively challenging applications brought by unrepresentative unions goes a long way to reducing industrial risk on the project or at the workplace. Conducting an industrial audit of your business identifying potentially relevant unions goes a long way to avoiding future disputes.
1 Douglas Heath v Gravity Crane Services  FWA 7751
© DLA Piper
This publication is intended as a general overview and discussion of the subjects dealt with. It is not intended to be, and should not used as, a substitute for taking legal advice in any specific situation. DLA Piper Australia will accept no responsibility for any actions taken or not taken on the basis of this publication.
DLA Piper Australia is part of DLA Piper, a global law firm, operating through various separate and distinct legal entities. For further information, please refer to www.dlapiper.com