Australia: Third Party Bargaining Suspension Overruled

The Australian Industrial Relations Commission has overturned a 2 month bar on industrial action by school teachers in the Northern Territory on the basis that the applicant was in effect a negotiating party and therefore not able to apply under s443 of the Workplace Relations Act 1996 (Cth).

Secret ballot by the AEU

In early March 2008 the Australian Education Union (AEU) conducted a secret ballot of its teachers to undertake industrial action including proposed work stoppages and bans on performance of any work outside prescribed hours of duty. The secret ballot related to a bargaining period which the AEU had commenced with the Office of the Commissioner for Public Employment (OCPE). The AEU and the OCPE were negotiating a new collective agreement to replace the Northern Territory Public Sector 2005-2007 Teachers and Educators Certified Agreement which had nominally expired on 31 August 2007.

After obtaining authorisation from the teachers via the secret ballot in March, the AEU gave notice of its intention to undertake industrial action including three 24 hour stoppages from September 23-25 in support of its claims for the new collective agreement.

Application under section 433(1)

The Northern Territory Department of Education and Training (Department) applied as an affected third party to suspend the bargaining period between the AEU and the OCPE under section 433(1) of the Workplace Relations Act 1996 (Cth) (Act) on 19 September 2008. The Department's application under section 433 of the Act was filed on the basis that at the time of the proposed industrial action approximately 850 students in Years 11 and 12 were scheduled to commence their Northern Territory Certificate of Education Exams and the Department considered that the planned industrial action threatened to jeopardise those exams. The AEU briefly countered this application by arguing that the affected schools would be attended to by a 'skeleton staff' of teachers.

In reaching his decision Senior Deputy President Kaufman said that the planned industrial action threatened to cause significant harm to students due to commence their final exams. SDP Kaufman found that Year 12 students were particularly vulnerable to the effects of the planned industrial action. He held that it was necessary to balance the interest of the students in the affected schools against those of the employees planning the action. On 20 September 2008 SDP Kaufman ordered that the bargaining period between the AEU and the OCPE be suspended from 20 September 2008 to 20 November 2008.

The practical effect of this order meant that the AEU members could not lawfully take industrial action during that period.

Appeal against decision of DP Kaufman

In late October the AEU appealed the decision. The appeal was heard by Vice President Watson, Deputy President Hamilton and Commissioner Eames.

The AEU submitted that the Department and the OCPE were effectively the same entity and it was artificial to separate them. The AEU advanced this argument on two fronts, submitting firstly that the Department was a negotiating party and could not reasonably be considered to be a third party. Subsequently it also argued that the connection between the Department and the OCPE generally meant that the moving party behind the application was the OCPE, a negotiating party precluded from making the application.

Decision of Deputy President Hamilton and Commissioner Eames

The central focus of DP Hamilton and Cmr Eames' decision in the appeal was that the Department and the OCPE were both entities within the Northern Territory Government and could both be construed as a part of the one public sector entity, which was in effect a negotiating party.

In considering the question of whether the Department was, of itself, a negotiating party, DP Hamilton and Cmr Eames noted a provision of the expired certified agreement which provided:

"3.1 This Agreement will be binding on:

3.1.1 The Commissioner and Agency in respect of all employees who are covered by the scope and incidence of the Northern Territory Public Sector Teachers and Assistant Teachers Award 2001 (AW811318)."

DP Hamilton and Cmr Eames viewed this provision as significant as the Department was an entity bound by the certified agreement. Additionally, DP Hamilton and Cmr Eames found that section 12 of the Public Sector Employment and Management Act 2007 (NT) provides that the OCPE is a deemed employer on behalf of the Department.

It was also found that the OCPE was an "auxiliary" or "representative" of the Department similar to a statutory agent. They held that the Department could not differentiate itself from the entity proposed to be bound by the incumbent collective agreement and accordingly could not bring proceedings pursuant to section 433.

DP Hamilton and Commissioner Eames concluded by finding:

"Section 433 is concerned to protect third parties, but in no real sense is the Department actually a third party. To call it such would be highly artificial, and manifestly absurd or unreasonable. It has a direct and inescapable interest in the outcome of the bargaining, and is currently bound by the old certified agreement by virtue of s.12 and a provision that directly so provides."

Accordingly, DP Hamilton and Cmr Eames found that the Department was excluded from seeking to have the bargaining period suspended under section 443 of the Workplace Relations Act.

Minority decision – Vice President Watson

In his minority decision, Vice President Watson said the Department wasn't a negotiating party to the proposed collective agreement, on the basis that it was clear from the wording of the notice initiating the bargaining period that only the AEU and the OCPE were proposed to be parties to the collective agreement.

VP Watson also commented on the interpretation of the Act stating that in his view there was no room for a reverse beneficial interpretation so as to erect a barrier to an application under section 433.

VP Watson stated that he did not think it was permissible to go behind the application and determine who might support or be a moving party behind it. He found it common that applications to the Commission be supported or encouraged by others.

Although he found the Department was unquestionably a relevant agency responsible for the conduct of schools in the Northern Territory, the provision of labour to the Department did not necessarily carry with it an additional employment relationship between the OCPE and the Department.

Lessons for third party applicants

The decision on appeal highlights the importance of third party applicants under section 433 being genuine third parties independent of the negotiation parties. The Commission's willingness to consider expired industrial instruments and background documents evidencing a connection between an applicant and a negotiating party demonstrates the depth of investigation that the Commission will accept when reaching a decision on the legitimacy of a third party applicant.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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