Ross Jackson

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Enterprise Bargaining Update
Current Issues in Enterprise Bargaining
Ross Jackson Partner Maddocks
Greg Freebairn IR Consultant Maddocks
Professor Gerry Griffin Facilitator
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Agenda

• Bargaining Agents Fees
• Amcor
• Pattern Bargaining
• Emwest
• Practical Issues
• Some Popular Areas of Negotiation

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Bargaining Agents Fees

• Issue in Electrolux was whether fee pertained to
  the relationship of employer and employee
• EBA under s.107LI must be about such matters
• Div. 2 Agreements bind all persons whose
  employment issubject to the agreement as well
  as employer and relevant unions C/F s.170 MA for
  Div.3

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Bargaining Agents Fees (cont)

• Query enforceability under s.178 probably only
  could try and obtain penalty (?) not an amount
  payable to an employee under s.179 or s.178(6)
• Merkel J Held did not pertain to employment
  relationship, industrial action in pursuit of it
  not protected
• Full Federal Court action could be protected
  (because s.170ML(2) bargaining period in place
  etc) even if what is demanded cannot ultimately
  be included in certified agreement

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Workplace Relations Amendment (Protection of
Compulsory Union Fees)Act 2002

• Commences 9 May 2003
• Makes bargaining service fee clauses in existing
  EBAs void (new S298Y)
• Prohibits demands for (s298SA) or inclusion of
  bargaining fee clauses in new EBAs (s298Y)
• Does not prevent either
• a) voluntary contributions
• b) contract at common law direct with the
  employee

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Amcor Nothing New!!

• No exemption in EBA from severance upon
  transmission
• Payment consequent upon 2 things
• redundancy, then
• retrenchment
• Contrast with TCR deemed continuity of
  employment the proviso to which Finkelstein J
  referred, and which would have prevented
  liability?
• TCR clauses/exemption preserves the
  servicecomponent for which severance is
  compensation c/f Amcor where these were paid out

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What to do?

• 1.
• Watch this space ? appealed to High Court,
  seeking to limit transmission to take over
  situations.
• 2.
• Ensure belts and braces anti - Amcor clauses
  are included, even where TCR - type clauses
  exist exact wording required depends upon
  context

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What to do? (cont.)

• 3.
• Beware of assuming the underlying award TCR
  clause will still apply to a minimal EBA -
  depends upon Relationship with Parent Award
  clause
• 4
• Clause should say something like under no
  circumstances will the above notice and/or
  severance entitlements be payable upon a
  succession assignment or transmission of all or
  part of the employers business

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Pattern Bargaining

• Now possible (since 7 Feb) to have a bargaining
  period terminated (thus rendering unprotected any
  subsequent industrial action) on grounds of
  pattern bargaining i.e not genuinely trying to
  reach a one on one agreement s.170 MW(2A)
• Doesnt prevent claims that are similar or even
  identical
• s170 MWA prevents the withdrawal and subsequent
  re-initiation of bargaining periods for the
  purposes of pattern bargaining

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Cooling off Periods

• S170 MWB allows for AIRC to suspend bargain
  periods where it considers it appropriate
• Allow for voluntary conciliation or access to an
  agreed mediator
• Legislation gives effect to principle (CPSU v
  Sensis) that no duty to negotiate, but if do,
  must do so lawfully and in good faith

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Emwest

• Currently on appeal to the Full Federal Court
  12/5
• Current law Allows protected action during life
  of the EBA in support of claims regarding matters
  not covered by EBA
• Must seek to insert a no extra claims clause
  that covers all matters, not just those covered
  by the EBA, for the life of the EBA

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Emwest Example

• the parties agree that until
• the nominal expiry date of this Agreement has
  passed or
• this Agreement has been terminated under the
  provision of the Workplace Relations Act 1996
• the Union and employee parties to this
  Agreement shall make no extra claims upon the
  Employer whatsoever, whether or not the claim
  relates to any matter expressly or impliedly
  covered by the terms of this Agreement

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Private Arbitration

• S.170LW extremely broad application of the
  agreement c/f S.89A
• Effectively means that most dispute resolution
  clauses that permit the AIRC to determine any
  matter arising (eg under grievance) will result
  in the AIRC, not management, determining the
  merits of the issue CFMEU case NTEIV v
  University of Wollongong (9/4/04)
• If want to quarantine particular processes (eg
  discipline and performance management processes)
  must expressly do so in EBA by excluding them
  from dispute resolution clause.

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Further Developments

• End of Schedule 1A
• need to bargain out of new common rule Awards
• different Awards may be used for no disadvantage
  test
• Gribbles re transmission need to proactively
  pursue s170LY priority of EBA issues as part of
  pre - purchase or tender due diligence

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Bargaining Agents Fees Practical Issues

• Employers cannot conspire with a Union regarding
  payment of fees
• Need to keep a close watch on voluntary
  contributions
• ensure no coercive conduct
• General comment - Unions pursued Bargaining
  Agents Fees due to falling membership numbers, no
  doubt they will attempt to find a way around the
  new legislation

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Amcor Practical Issues

• Establish the relationship Award(s) and
  Agreement(s) - What applies?
• Review the current clauses. Are they the basic
  TCR standard?
• Understand the potential consequences of
  restructuring, outsourcing etc.
• Pending a High Court decision, include
  appropriate clauses in all new Agreements

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Pattern Bargaining Practical Issues

• Obviously the new legislation gives an option to
  seek a suspension or termination of a bargaining
  period on the basis of lack of good faith
  bargaining
• Current strategies remain relevant and are
  probably preferred
• engage with employees directly
• pursue reasonable agendas at the local level
• promote employee involvement
• consider 170 LK or AWA options

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Emwest Practical Issues

• Important to be careful with other clauses
• A sound No Extra Claims clause can be subverted
  by another clause that allows negotiation of a
  further or ongoing claim

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Some Popular Areas of Negotiation

• Absorption of allowances and penalty payments
  into higher base salaries/wages
• Increased incidence of bonus payments and
  performance based payments
• i.e a part of a wage increase is at risk
• Countering high absenteeism features
• Incentive and reward schemes
• payout of accumulated S/L
• attendance bonus (collective and individual)
• converting unused S/L to A/L
• a range of family friendly conditions

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Some Popular Areas of Negotiation (cont)

• Paid parental leave (Retail Sector)
• Employees seeking incentive claims to promote
  employee development / Unions seeking local
  Representative training
• Salary sacrifice schemes
• Variable/ Seasonal Hours
• banking in busy time to offset low production
  time
• transition from full to part-time
• Securing employee entitlements
• including severance

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Ross Jackson Partner Maddocks ross.jackson_at_maddoc
ks.com.au
Greg Freebairn IR Consultant Maddocks greg.freebai
rn_at_maddocks.com.au