Section
51(35) and the AIRC
-
Prior to Federation in 1901, Australia was divided up into six independent
colonies, all asserting separate independence from Britain
and from each
other. From the 1850s on, there was a push for a closer association of
colonies due to their common origins, culture,
geography, foreign and defence
needs, economic advantage and practical convenience.
-
In 1898 a motion to include in the Constitution, the right for the Commonwealth
to legislate in industrial relations, was passed with a majority 22-19
vote. This motion eventually
led to s.51(35) of the Australian Constitution,
which provides that the parliament may make laws with respect to :
Conciliation and arbitration for the prevention and settlement of
industrial disputes extending beyond the limits of any one State.
-
Section 51(35) was intended to define the limits of the Commonwealth's
power to legislate in respect to industrial relations in Australia.
-
Section 51(35) has greater significance when read in conjunction with s.109
of the Australian Constitution, which states:
When a law of a State is inconsistent with a law of Commonwealth,
the latter shall prevail, and the former shall, to the extent of
the inconsistency,
be invalid.
-
The combination of ss.51(35) and 109 of the Constitution allows industrial
relations to be governed by Commonwealth legislation to the exclusion of
most State legislation. At various times
this can be attractive to either
an employer or a union seeking to escape State legislation.[1]
-
There are a number of obvious limitations on the federal government's legislative
power under s.51(35) of the Constitution. These limitations have been defined
and articulated through numerous High Court decisions and can generally
be summarised as follows:
1. The federal government cannot directly regulate industrial relations
through legislation but may provide for the establishment
of machinery
for the settlement of disputes.[2]
2 That machinery is currently the Australian Industrial Relations
Commission (AIRC) established under the Workplace Relations Act 1996 and
must operate only by way of conciliation and arbitration when using the
s.51(35) powers.[3]
3. Where the power under s.51(35) is relied upon the AIRC can only
deal with industrial disputes and the Commission can only operate within
the ambit of the dispute
ordinarily created through logging of claims on
employers by unions.[4]
4. The dispute must be of an industrial nature although the definition
of industrial matter has been widely expanded by the High
Court in recent
years.[5]
5. The dispute must be one that extends beyond the limits of any
one State to create a dispute of interstate character.[6]
-
It should be noted that there is no constitutional requirement that parliament
exercise the power conferred by ss(35) That is a
matter entirely for parliament's
discretion. Having established the AIRC there is no constitutional requirement
that it be established
on a permanent basis. There is nothing to prevent
the establishment of some other body having the role of conciliation and
arbitration.
-
The above limitations can be contrasted with the jurisdiction of State
Industrial Tribunals, which are normally limited only to
the need to establish
that an industrial matter exists.[7]
-
With the need to establish: (1) interstateness, and (2) that the subject
matter is industrial, invoking the jurisdiction may seem
arduous. In practice
however, the prerequisites are easily satisfied and rarely tested. In many
circumstances, parties consent
to the jurisdiction of the AIRC without
any investigation as to whether any of the tests above have been met and
the Commission
is happy to accept at face value its jurisdiction where
no challenge is likely to be made.
-
The Workplace Relations Act 1996 (Cwth) has been drafted to be consistent
with the power of s.51 (35) and thus industrial dispute is defined in s.4
of the Act as follows:
(a) an industrial dispute (including a threatened, impending or
probable industrial dispute);
(i) extending beyond the limits of any one State; and
(ii) that is about matters pertaining to the relationship between
employers and employees; or
(b) a situation that is likely to give rise to industrial dispute of
the kind referred to in para (a);
-
While the words threatened, impending or probable are not found
in s.51(35), the High Court has long held that an industrial dispute that
has at least progressed to the stage of being threatened, impending,
probable or likely comes within the scope of the legislative power
conferred by s.51(35)[8] due to the
use of the word 'prevention' in s.51(35).
-
While the functions of the AIRC include preventing industrial disputation
it cannot take a pro-active role unless there is at least
a threatened,
impending or probable dispute[9] for
its jurisdiction.
Need for
Interstateness
-
A plain reading of s.51(35) suggests that the general control of industrial
relations is the province of the States on the understanding that most
industrial
disputes relate to subject matters that are limited to the relationship
of employers and employees in any one State and do not extend
beyond State
boundaries. However, the percentage of federal award coverage in Australia[10]
indicates that s.51(35) has been utilised more often than may have been
anticipated.
Federal Award coverage - 31.5%
State Award coverage - 44.5%
No award coverage - 20.0%
-
Excluding State Industrial Commissioners with dual appointments to the
AIRC, the AIRC employs approximately 52 full time Commissioners,
indicating
there is no shortage of interstate industrial disputes. This is a substantial
increase than earlier this century, for
example in 1909 only seven matters
came before the Court of Conciliation and Arbitration [11]
Early
High Court Cases
-
The early High Court cases concerning s.51(35) often referred to the intention
of the framers. In 1908 the High Court held that the connotation or meaning
of a given term in
the Constitution remains fixed as it was in 1900, while
its denotation or the extent of its application changes according to circumstances[12]
It is interesting to note that early High Court judges such as Higgins,
Isaacs, Barton and O'Connor were all members of the National
Australasian
Convention of 1897, which discussed the drafting of the Australian Constitution.
Despite this affiliation they still managed to disagree on the application
of s.51(35) in their decisions. Griffith CJ who didn't attend the Convention
was often in disagreement with fellow justices in finding that
interstate
industrial disputes under 51(35) did not exist, preferring to rely on his
understanding of the Constitution's intention,
of only allowing federal
jurisdiction of industrial disputes where they clearly traversed interstate
boundaries.
-
The views of the High Court when considering s.51(35) must be examined
in light of eight Justices O'Connor, Higgins, Isaacs, Powers, Rich, Starke,
Gaudron and Kirby, having either previously
or contemporaneously served
on federal industrial bodies.
-
The broad view of these Justices in interpreting s.51(35) suggests they
may have been influenced by their experiences on these Tribunals.
-
The intent of the Constitutional framers was raised in 1908 by O'Conner
J in Federated Sawmill, Timberyard and General Woodworkers Association
of Australasia v James Moore and Sons Pty Ltd (The Saw Millers case)[13].
O'Connor J was particularly concerned with the intention of the framers
of the Constitution. That intention was that an industrial dispute must
genuinely traverse State boundaries.
It must always be remembered the intention of the British Parliament
when dealing with the subject practically, that they had in
mind actual
differences between employer and employees, differences of a kind public
interests demanded should be submitted to
a federal tribunal.
They were thinking of real industrial disputes not of industrial
disputes that existed only on paper or got up for the attainment
of some
other ulterior object than the settlement of differences between employers
and employees.
-
In 1910 Griffith C J expressed the need for genuine interstateness in a
dispute in Australian Boot Trade Employees Federation v. Whybrow &
Co[14] (Boot Trade case). He stated
at p.281 that discontent with a State law couldn't be described as a dispute
in any sense. The Chief
Justice went on to state, that to hold such a view
admits the federal tribunal to substitute its uncontrolled volition for
the
will of the parliaments of the States.
-
Two years later he repeated those comments in R v. The Commonwealth
Court of Conciliation and Arbitration and Merchant Service Guild[15]
(Merchant Service Guild Case).
The dispute must be actually existing and actually extending beyond
the limits of one State before such an occasion can arise. Mere
mischief-makers
cannot therefore, by the expenditure of a few shillings in paper, ink and
postage stamps create such an occasion.
-
In the Merchant Guild Case, 83 respondents were served in identical
terms with a demand that the claim be acceded to within 15 days.
-
At p.599 the Chief Justice stated that before an industrial claim can develop
into an industrial dispute, there must be some real
opportunity of discussion
between the parties concerned. A log of claims was the first notification
of any dissatisfaction by the
employees concerned with their existing conditions
of service. The Chief Justice posed the question, whether at the expiration
of the 15 day time frame an industrial dispute extending beyond the limits
of any one State would automatically come into existence
of which the Commonwealth
Court of Conciliation and Arbitration would have cognizance? He held that
to reach that conclusion, ss
(35) would need to be read as:
... arbitration for the settlement of industrial claims made in
identical terms in two or more States", so that the whole field of
regulation
of domestic industrial affairs would be potentially transferred from the
State legislatures to the Arbitration Court
at the will of any body of
employees or employers who chose to go through the form of making a written
demand.
-
Another early case dealt with by the High Court concerning interstateness
was the Federated Felt Hatting Employees Union of Australia v. The Denton
Hat Mills Ltd & Ors[16]. The
Union had served a log of claims which they argued should govern the conditions
of work and wages of members of the union
in three States. The three states,
New South Wales, Victoria and South Australia, all worked under different
state systems and
conditions of employment.
-
In that case Griffith C J stated that the power conferred by parliament
by ss(35) is not a power to transfer the control of industrial
enterprises
to a tribunal by empowering it to accede to any and every demand made by
employees. Where logs of claims are used to
take control of industry out
of the hands of employers by seeking federal award coverage; such attempts,
in the words of Griffith
C J are (p 94),
"a fraud on the Constitution".
-
Griffith C J went on to state that the object of the power of s.51(35)
is to prevent and settle real industrial disputes and not to facilitate
the creation of fictitious disputes, with a view to their
settlement by
a Commonwealth tribunal. The reasoning of the Chief Justice in the 1914
Felt Hatters case was, some 80 years later repeated by the High Court
in SPSF ex parte Attorney General (the SPSF case) [17]
when they held that a claim that the AIRC should exercise general regulatory
power does not give rise to an industrial dispute.
The Process of Interstate Dispute Finding
-
Industrial disputes extending beyond the limits of any one State are predominantly
precipitated by a union (less frequently by
an employer) by serving on
employers a log of claims, usually in ambit form. The ambit log is accompanied
by a letter of demand,
requiring agreement to the claims in full, within
a specified time usually around seven days. The union does not normally
negotiate
with employers prior to serving the log of claims or prior to
seeking a dispute finding from the AIRC. As Isaacs J stated in the
Merchant
Service Guild case p.607, the only difference between s.51(35) disputes
and what would be normally understood by the term 'industrial dispute'
is that the dispute extends beyond State boundaries.
-
In State jurisdictions, industrial disputes do not, as a rule, develop
through a formal serving of an ambit log of claims on employers.
The process
of ambit logs served concurrently in more than one State in an artificial
procedure designed purely to meet the requirements
of s.51(35).
-
Once an interstate industrial dispute is settled by the issuance of a federal
award, then federal award regulation will become
the norm. It is unusual
for an interstate industrial dispute to be settled through the issuance
of a federal award and then for
the industrial regulation to revert back
to a State jurisdiction. The ability to maintain an interstate industrial
dispute is due
to the ambit nature of the claims originally served on employers.
It is rare for a single issue in an industrial dispute to become
an interstate
industrial dispute, yet surely this must have been what the Constitutional
framers had in mind. An interstate dispute
finding relates to all matters
contained in the log of claims, which usually cover all aspects of the
employment relationship.
-
Reliance on s.51 (35) of the Constitution is not limited to unions. On
occasions it may be desirable for employers in conjunction with unions
to obtain federal award coverage.
There may be strategic reasons, such
as removing State unions and substituting a Federal union or avoiding State
industrial legislation.
-
Some industries are predominantly covered by federal awards while others
are predominantly covered by State awards. For example,
the maritime, transport
and construction industries are generally industries under federal award
coverage[18], while retail, mining
and hospitality are generally State regulated industries[19].
-
There are very few industries that are not conducted by employers in more
than one State. The industries that are now covered by
the federal industrial
system are not of themselves more prone to interstate industrial disputation.
Rather, following the initial
interstate industrial dispute finding, the
AIRC has determined that federal award coverage is more appropriate than
State award
coverage.[20]
-
Where an industry is purely State-based this does not prevent a finding
of an interstate dispute if some community of interest
can be show. In
1987, Peko-Wallsend Ltd was successful in obtaining an interstate industrial
dispute finding between three of its
subsidiary companies:
King Island Scheelite (off the coast of Northern Tasmania).
Mount Morgan Ltd (a gold mine in Queensland).
Robe River Iron Associates.
-
Scheelite mining occurs only in Tasmania, iron ore mining only in Western
Australia. An interstate dispute was still found to exist
due to the common
proprietary interest of Peko-Wallsend Ltd in the three companies.
Case Studies
-
The two following case studies demonstrate at a practical level, the abuse
of the interstate industrial dispute power under the
Constitution by both
unions and employers.
WA Coal Industry
-
On 1 December 1993 the Western Australian Liberal/National Party Coalition
Government gave effect to a new Act known as the Workplace Agreements
Act 1993. This Act provided for the usurping of State industrial awards
and agreements by the registration of Workplace Agreements between
employers
and employees by the Commissioner of Workplace Agreements. This legislation
was the centrepiece of the coalition's industrial
relations platform prior
to its successful election to government. The Minister for Labour Relations
stated in his Second Reading
Speech that the Act would establish an alternative
system of Workplace Agreements between employers and employees where no
State
award will apply as long as a Workplace Agreement remains in force.
The Minister stated that the Act would return the control of
workplace
relations to the hands of those people most directly concerned, that is
the employer and employees.
-
As a result of the passage of this legislation, a number of Western Australian
unions determined that the federal system of award
regulation would provide
better protection for their members as a result of changes to the Industrial
Relations Act 1988 (Cwlth) introduced by the then Federal Labor Government.
One such union was the Coal Miners Industrial Union of Workers of Western
Australia (CMU). Their federal body was the Construction, Forestry, Mining,
Energy Union (UMW Division) (CFMEU). In addition to
the CMU, the Australian
Collieries Staff Association Western Australian Branch, Industrial Union
of Workers (ACSAWA) also determined
to move industrial coverage to the
federal jurisdiction using the endeavours of their federal body, the Australian
Collieries Staff
Association (ACSA).
Construction
Forestry Mining and Energy Union
-
The CFMEU served an ambit log of claims on Western Australia's coal mining
companies, The Griffin Coal Mining Co Pty Ltd and Western
Collieries Ltd
on 18 February 1994. CMU members in Collie WA were not aware of the alleged
industrial dispute until a meeting was
held in Collie eight days later
on 26 February 1994 at which they were advised of the log and subsequently
endorsed it. Evidence
given by the CFMEU's witnesses at the dispute hearing
included the union's desire to seek federal award coverage to escape the
WA Workplace Agreements legislation. This was referred to by the Chairman
of the then Coal Industry Tribunal of Australia[21]
(CIT Aust) in his decision where he stated:
There is no doubt that the objective of conferring jurisdiction
on the Tribunal loomed large in the thinking of the officers of the
CFMEU
and perhaps amongst members in Western Australia.
-
The Chairman then went on to state:
I have found that the demand did have as an aim the establishment
of federal jurisdiction in Western Australia but in view of the
authorities
I have referred to and the evidence before me I conclude that that was
not the only aim of the claim and therefore
the claim should be held to
be genuine.
-
Evidence from the Federal Secretary, was that the union genuinely demanded
what it sought in the log of claims and would seek to
obtain the demands
over time. This was despite not knowing what was contained in the log of
claims or what terms and conditions
governed WA coal mining employees.
-
On 24 March 1995 the Chairman of the CIT Aust found that an interstate
industrial dispute existed between CFMEU and the two Western
Australian
coal-mining companies and two coal mining companies in NSW. The coal mining
companies in NSW had never had any association
with the WA companies and
were in different markets. The eastern states coal-mining companies exported
coal whereas the WA companies
produced coal for power generation only.
They were not connected by being in competition for the same markets, their
only community
of interest was that they were mining the same product.
This is consistent with the SPSF Case where the fact that the employees
were in the same industry the "pubic service" was sufficient to establish
a community of interest.
-
At no stage prior to or subsequent to the dispute finding, did the CFMEU
ever attempt to negotiate with either WA company any of
the conditions
contained within the log of claims. This was hardly indicative on any real
industrial dispute.
-
On 8 November 1995 Duncan D.P. now with the AIRC following the abolition
of the CIT Aust, revoked his dispute finding following
an application by
the WA Coal companies on the basis that the service of the log of claims
by the CFMEU was not in accordance with
the union's rules.[22]
-
As a result of the revocation of the dispute finding the CFMEU served another
log of claims on the WA coal companies and on other
eastern states coal
operations.
-
On 30 October 1996, Harrison C from the AIRC, again found that a dispute
existed between the two WA coal companies the CFMEU and
some eastern states
coal mining operations[23]. Since
the original serving of the log of claims in February 1994, again the two
WA coal companies have never been approached by
the CFMEU to discuss the
log of claims. In fact, what had been occurring, was that the local WA
union, the CMU had negotiated enterprise
agreements with both coal employees.
which had been ratified before the Coal Industry Tribunal of WA. Both enterprise
agreements
covered all the terms and conditions of employment of WA coal
miners, confirming the belief that the interstate finding was simply
a
fall back position should workplace Agreements be offered to WA coal miners.
The Coal Staff
-
The circumstances involving the ACSA are similar to those of the CFMEU.
-
On 27 June 1996 Harrison C of the AIRC found that following service of
a log of claims by the ACSA on 14 September 1995 an interstate
industrial
dispute existed between the ACSA, the WA coal companies and some eastern
states coal companies.
-
The log of claims served on 14 September 1995 was the fourth log served
within a period of three years, but the only one progressed
to the dispute
finding stage. No explanation was provided by the union as to why the previous
three logs were served then later
withdrawn. Members of the ACSA, gave
affidavit evidence in relation to the union's stated objectives in serving
the log of claims.
This evidence clearly indicated that there was no genuine
dispute. Some of the uncontradicted evidence of ACSA members was in the
following terms:
It was made clear at this meeting that the log of claims was deliberately
made so ridiculous in the terms of the pay and conditions
sought that no
employer could possibly afford to pay the demands made. It was deliberately
drafted so a dispute could be created.
It was confirmed by the union officials at the meeting that the
union's only intention was to obtain a mythical dispute finding in
order
to save time if at any stage union members decided they wished to have
a federal award.
It was purely a safety net if the company takes action against members.
Indeed the union advised once the dispute had been found it does
not have to be acted upon.
He reiterated (the union official) that the dispute finding process
was to enable a choice to be put to members as to whether they
wanted federal
award coverage in lieu of existing state award coverage.
If a dispute was found no action would be taken and the matter will
be placed on the back burner.
-
In regard to this evidence, Harrison C stated that he gave little weight
to the evidence of the ASCA members[24],
but relied on what the union said and not its members.
-
On 24 February 1997 a Full Bench of the AIRC dismissed an appeal by the
WA coal companies on the basis that the log of claims was
directed towards
the protection and improvement of the salaries and conditions of employment
of its members as evidenced by the
General Secretary of the union. The
Full Bench relied on the High Court's decision in R v Ludeke; Ex Parte
Queensland Electricity Commission[25]
where it was stated:
But it is not an objection to the genuineness of the dispute that
the purpose of delivering the log of claims is to create an industrial
dispute, which will thereby give the Commission jurisdiction to make an
award.
-
The confirmation of the interstate industrial dispute finding by the Full
Bench was ironically five weeks after the registration
of the Western Collieries
Ltd Staff Agreement in the CITWA settlement of all claims relating to salaries
and conditions of employment.
-
Since the dispute finding the ACSA has not approached either of the two
coal mining companies to discuss any of their claims contained
in their
log confirming the artificiality of the dispute finding.
Wesfarmers/CSBP
Case Study
-
In April 1994 an interstate industrial dispute was found to exist between
the AWU and:
Tasmanian Fertilisers.
CSBP
Farmers Ltd.
-
The dispute finding was made by Hancock DP of the AIRC. In October 1996
Drake DP examined the process that led to the 1994 interstate
dispute finding
and determined that the resulting federal award and certified agreement
between the AWU and CSBP should be cancelled.
-
The cancellation was due to a failure by the parties to disclose all relevant
matters to the Commission and the fact that this
failure was calculated
and deliberate[26].
-
The cancellation came about by an application by the Australian Liquor,
Hospitality, Miscellaneous Workers Union (ALHMW) which
requested that the
certified agreement and award be cancelled. The General Manager, Human
Resources, for Wesfarmers Energy Ltd
gave evidence that he had contacted
the federal office of the AWU and arranged for them to serve a log of claims
on CSBP and Tasmanian
Fertilisers - (CSBP were in the process of purchasing
Tasmanian Fertilisers).
-
The General Manager, Human Resources had recommended to the Managing Director
of CSBP that the company seek a federal award with
the federal AWU being
the only respondent. This was due to the increased industrial action from
the ALHMWU which also had the majority
of employees as members, but had
State award coverage. A federal award with the AWU or a certified agreement
with the AWU, which
had constitutional coverage of all employees, would
effectively lock out the ALHMWU. Drake DP in describing the obtaining of
a
federal interstate industrial dispute finding stated:
The listing of these matters and the title of the award (Tasmanian
Fertilisers Award 1994) could not have been more conveniently
located as
to venue or described so as to camouflage activities of the employer and
the AWU (p.14).
-
The dispute finding and award were both obtained outside of Perth. The
dispute finding was obtained in Hobart and the subsequent
certified agreement
was obtained by audiovisual conference with a member of the Commission
in Adelaide. Drake DP went on to say:
The AWU and the employer entered into a deliberate course of action
to eliminate the applicant union from all awards and agreements
at the
premises of the employer in Western Australia by ambush. (p.21).
Comments
-
The above two cases demonstrate an exploitation of s.51(35) by both employers
and unions.
-
The two coal unions obtained interstate industrial dispute findings to
enable them to utilise the AIRC on any dispute within the
ambit of their
log of claims to the exclusion of the CITWA at short notice.
-
To the 'person in the street', the actions of both unions would not have
been categorised as an interstate industrial dispute under
s.51(35) of
the Constitution. The circumstances for these two unions were that in 1993
there was a potential that the WA State legislation may be used by employers
to secure individual agreements which may usurp the role of the unions
in the coal industry of WA. As a precaution against this,
an interstate
industrial dispute finding would provide quick relief if needed, by the
issuing of a federal award to overrule any
State individual industrial
agreements pursuant to s.109 of the Constitution.
-
The requisite interstate dispute was achieved through logging of companies
in other States who were not in competition and had
no connection or interest
in the WA companies, or any knowledge of the industrial dispute alleged
by the unions. Despite the evidence
of the unions own members stating that
the log of claims were simply an attempt to obtain federal coverage and
no more, the Full
Benches of the Australian Industrial Relations Commission
were prepared to take on face value the unions' evidence that they genuinely
sought the claims in the logs of demand. The subsequent lack of action
by both unions since the dispute finding confirms that either
the unions
have lost interest in the dispute or there was never any interstate industrial
dispute in existence.
-
The result in the WA coal industry is contrary to Griffith CJ's ratio in
the Boot Trade Case in 1910 when he stated that discontent
with a State law cannot be described as an industrial dispute. His comments
in 1912 in the
Merchant Service Guild Case (page 595) are also pertinent.:
...in the case of a mere paper demand, where industrial operations
go on as usual ...if a joint demand made by associated bodies
of men employed,
say, at Perth and Brisbane respectively on each of two employers who are
engaged in the same branch of industry
in those cities, but are unknown
to one another and have nothing else in common, could (not) be regarded
as an industrial dispute
extending beyond the State of Western Australia
to Queensland or beyond Queensland to Western Australia.
-
In the Wesfarmers/CSBP case, a union and employer jointly agreed to federal
award coverage to ostracise one union from the employers'
workplace. The
method chosen was to invoke the jurisdiction of the AIRC by a contrived
arrangement for the finding of an interstate
industrial dispute.
-
The dispute was originally found by Hancock DP as there were no objections
(which is normally the case) and it wasn't until two
years later that the
ALHMWU finally became aware of the actual circumstances and successfully
sought to have the award and agreement
set aside.
Future Use of S51(35)
-
Under the amendments to the Industrial Relations Act 1988 resulting in
the Coalition's Workplace Relations Act 1996 the incentive for unions at
least to apply for federal award coverage should ease.
Section 89A
-
Section 89A - Scope of Industrial Disputes - now limits the matters that
can be included in an award of the AIRC. These matters
are reduced to approximately
20 allowable matters in an attempt by the government to reduce awards to
basic minimum entitlements.
The incentive for a federal award with the
s.89A limitations is significantly reduced where the state jurisdictions
have no such
limitations on awards.
Part VIB
-
Union certified agreements can be obtained now without the need to obtain
an interstate industrial dispute finding under Part VIB Certified Agreements.
All that is necessary for a certified agreement is that the employer is
a constitutional corporation[27].
In addition, Part VIA of the Act allows for initiation of a bargaining
period where a certified agreement is sought which provides immunities
against
civil action being taken where industrial action occurs. These
immunities are not available where a log of claims is served on employers
to create an interstate industrial dispute, thus reducing the attractiveness
of traditional logs of claims under s.51(35).
Section 152(3)
-
Section 152(3) of the Act also allows State employment agreements to override
federal awards where a no disadvantage test is met.
In Western Australia
the Workplace Agreements Act (WA) has been amended to allow parties to
collective workplace agreements, which meet a no disadvantage test, to
override federal
awards, again reducing the desirability to obtain federal
award coverage.
Section 111AAA
-
The final nail in the coffin for s.51(35) dispute findings may be s.111AAA
of the Federal Act, which requires that the AIRC cease dealing with any
industrial dispute where
a State award or employment agreement exists.
A Full Bench of the AIRC has held that s.111AAA can be applied prior to
a dispute
finding.[28] The only exception
to this directive is where the AIRC is satisfied that it would not be in
the public interest to cease dealing
with the dispute. Section 111AAA,
(saving the public interest test), will only allow the AIRC to deal with
award free or existing
federal award employees, substantially eliminating
the traditional use of s.51(35).
-
This does not mean that federal regulation will disappear as Parliament
is now using other constitutional heads of power to regulate
industrial
relations, for example the corporations, external affairs and referral
powers[29], but only that s.51(35)
will not underpin this use.
Conclusion
-
When one looks at the dispute findings of the AIRC and decisions of the
High Court, there is an inescapable conclusion that to
invoke s.51(35)
of the Constitution is a relatively simple exercise. So simple is the task
that other challenges to the finding of a dispute - other than to its interstateness
have been raised by the innovative legal fraternity with limited success.
These attacks are virtual subsets of the threshold question
whether an
interstate dispute exists and include:
Is the dispute in an industry?[30]
Is the subject of the dispute an industrial matter?[31]
Is there a community of interest between the Respondents to the dispute?[32]
Are the claims sufficiently precise?[33]
Are the claims fanciful?[34]
Are the demands genuine?[35]
-
The latest challenge to dispute findings by employers has been whether
the claims have been made in accordance with a union's rules.
Strangely
the High Court has applied a more rigorous test to unions complying with
their rules than any other objection to an interstate
industrial dispute
finding. In Re: CFMEU, Ex Parte Dean[36]
a dispute finding was overturned because the log of claims wasn't properly
authorised according to the union's rules when served,
but later authorised
retrospectively.
-
Where a union makes its log of claims ascertainable over a reasonable period
of time, and where challenged, is able to provide
evidence that it genuinely
seeks what it claims and has complied with its rules, a challenge to a
dispute finding is unlikely to
succeed. Issues such as community of interest,
industry, or industrial matter are no longer areas of any serious challenge.
For
example, the question of whether a matter is an industrial matter was
answered with a broad definition in Re Cram and Others; Ex Parte NSW
Colliery Proprietors Association Limited and Others[37]
the High Court stated in a joint judgement:
No doubt our traditional system of industrial conciliation and arbitration
has itself contributed to a growing recognition that management
and labour
have a mutual interest in many aspects of the operation of a business enterprise.
Many management decisions, once viewed
as a sole prerogative of management,
are now correctly seen as directly affecting the relationship of the employer
and employee
and constituting an industrial matter.
-
Following the SPSF Case, there was some thought that the days of
the ambit claim were gone. However, the decision of the High Court in Attorney
General for Queensland v Senior Deputy President Riordan and Others[38]
(Ambulance Officers Case) has put any thoughts of ambit claims being unconstitutional
beyond doubt. In their joint judgement Brennan
C J and McHugh J stated
at p.12:
Without a background of industrial experience, a bystander might
easily conclude that they were not real and genuine claims, even
having
regard to possible developments in the foreseeable future and allowing
some reasonable latitude in their formulation.....
Possessed of special
experience the respective Commissioners revealed no initiating error of
principle in their findings (my emphasis).
-
The High Court then went on to state that the ambit doctrine had undoubtedly
encouraged extravagant demands but to deny this outcome
would be to turn
a blind eye to the history of Australian industrial law. In the SPSF
Case, Mason C J, Deane and Gaudron J J said at page 267, when concluding
that the claims were fanciful, that:
.......... The Constitution in s.51(35) speaks of "industrial disputes"
not "industrial disturbances". Leaving aside questions that may arise with
respect to the parties
to a dispute, its subject matter and interstateness,
all that is necessary to constitute an industrial dispute is disagreement
as to the terms or conditions that should, in fact, apply to an employer
and employee. Obviously, disagreement of that kind may
come about as a
result of a written demand and, thus, there is nothing inherently artificial
about a "paper dispute".
-
But while the SPSF reasoning is no different from that of Griffith CJ in
1914 in the Felt Hatters Case such paper disputes have formed the
basis for interstate dispute findings in the intervening 80 years. They
have escaped scrutiny
because the log of claims has been more particularised,
but not necessarily more legitimate.
-
One could conclude that the High Court decision to revoke the dispute finding
in the SPSF Case was an aberration in the normal process of serving
logs of claims to create an interstate industrial dispute. The SPSF log
had only
four clauses one of which was the title clause, demanded a minimum
wage of $5,000 per week and a minimum of $2,500 per week in allowances
and CPI increases in wages and allowances. If a dispute were found on the
basis of the log, the ambit of the log would essentially
only have allowed
for a wages clause in an award. It is not surprising that the Full Bench
of the AIRC (while holding there was
a genuine dispute) described the demand
as simple and crude.[39]
-
The ETU log also subject to the High Court SPSF decision had no difficulty
in satisfying the Court of its genuineness. That log
was more detailed
and while it had a claim of a weekly wage of $2,000 it had additional rates
for other classifications and allowances.
Simply because one union puts
more effort in drafting its log the High Court was able to sanction the
genuineness of the claim.
-
Mason C J in the Wooldumpers Case [40]
commented on the artificiality required to invoke the jurisdiction of the
AIRC. He was of the view that the structure of the Act
has led to an over
emphasis on the paper dispute arising from non acceptance of a log of claims
and referred to the comments of
Dixon C J, McTiernan and Kitto J J in R
v Graziers Association NSW; Ex Parte Australian Workers Union[41].
The Graziers case referred to the artificial procedure for the production
of an industrial agreement and in that case Fullagar
J at p.333 referred
to the entire system for conciliation and arbitration for industrial disputes
under the Act as "highly artificial".
-
Despite his observations in 1989 Mason C J in Wooldumpers went on
to say in the SPSF Case at p.268:
Given the doctrine of ambit and given that there is nothing inherently
artificial about written demands or "paper disputes", it will
not often
be the case that a written demand with respect to the wages or conditions
of employees will be other than a genuine demand.
-
Despite the need for an interstate industrial dispute under s.51(35), the
AIRC has come to be the body that has a significant role in regulating
wages and conditions of employment nationally. This
is clearly highlighted
in the National Wage cases that are held from time to time under a centralised
wage fixation system which
determines wage increases to be flowed on to
all federal awards. To invoke jurisdiction of a National Wage case the
ACTU makes
its claim under a number of key industry awards and provided
there is ambit under the dispute findings that found those awards,
the
Commission is able to vary those awards to accommodate any national wage
increase. The dispute findings that the Commission
and the parties rely
upon may have been made years prior the National Wage decision.
-
The High Court has adopted a generous view of s.51(35) when ambit logs
of claims have been used as the vehicle to invoke s.51(35) and consequently
jurisdiction of the AIRC. In adopting this generous view, the High Court
has been inconsistent in its approach
to the interpretation of s.51(35).
-
The wide view of ss 35 has resulted from two contrasting approaches. In
widening the meaning of 'industrial dispute' the High Court in the Social
Welfare Case refused to give the words of ss 35 their technical or
legal expression, preferring to give them their popular meaning, what they
mean to the 'person in the street'.
While this is a perfectly legitimate
approach, the High Court has never applied the 'man in the street' test
to interstateness
or genuineness. In the SPSF Case the High Court
in maintaining a wide view of s.51 (35) stated that the bystander might
have easily concluded that the log of claims was not real and genuine.
It was acknowledged
by the High Court that only because of the AIRC's 'special
experience' could they ascertain that the claims were real and genuine.
Had they taken the 'man in the street' approach the log of claims would
not have constituted a genuine demand.
-
What the High Court has allowed, over time, in logs of claims:
a union need have no intention of obtaining the claims immediately[42]
a claim which could not possibly be met presently or in the foreseeable
future
a predominant purpose can be to create a dispute so as to give jurisdiction
to the AIRC[43].
-
The above concepts would not seem to fit with what the "person in the street"
views as an interstate industrial dispute. Nor could
such an approach be
said to be necessary to .....keep pace with the progress of the country
and adopt themselves to the new developments of time and circumstances[44]
-
The absurdity of this system was captured by Windeyer J in Ex Parte
Professional Engineers Association[45]
when he stated:
To permit the creation of a malady so that a particular brand of
physic may be administered must still seem to some people a strange
way
to cure the ills and ensure the health of the body politic.
-
It appears the High Court has allowed the absurdity to continue for too
long to redress it now. Kirby J in the Ambulance Officers Case (p
42) was of the view that because paper disputes were so deeply entrenched
in authority of the High Court they should not be
disturbed.
-
But this view wasn't taken in the Social Welfare Case. In significantly
expanding the definition of 'industrial' by jettisoning the concept of
the need for the dispute to be in an industry,
the High Court stated they
were fulfilling the object of s.51 (35) of enabling settlement of a dispute
that couldn't be settled by a single State or its Tribunals.[46]
-
Creighton and Stewart comment[47]
that the founding fathers of the Constitution considered that the powers
of 51(35) would be rarely if ever used as most disputes would be dealt
with at a State level; this is
in complete contrast to what has happened.
-
R M Eggleston QC in his paper Industrial Relations, in Essays on the Australian
Constitution (1st edition; 1952) at p.208 stated that the interpretation
by the High Court of s.51 (35) has enabled the Commonwealth Tribunal to
extend its influence to an extent which the framers of the Constitution
could hardly have contemplated.
-
While it is acknowledged by both High Court judges and academics, that
s.51 (35) has expanded beyond its original intention, the High Court refuses
to address the problem on the basis that it has gone on
for too long. This
seems hardly an approach to be taken by a body provided with the role of
ensuring our laws and practices are
consistent with our Constitution.
