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[2] One purpose of this paper is to outline the union recognition
provisions as contained in the UK Act. The British position will
then be
compared and contrasted with the Australian model, whereby unions are recognised
simply by virtue of registration under the
federal industrial relations
legislation. For this purpose, reference will be made to three of the leading
Australian cases on union
recognition, which will serve to indicate the extent
to which Australian unions have been able to use their registered status to
advance and protect their members’ interests.
[4] The Explanatory Notes
to the Bill state that, in so far as the union recognition provisions are
concerned, the Bill is to provide
for
new statutory procedures for the recognition and derecognition of trade unions for collective bargaining, to apply when unions and employers are unable to reach agreement voluntarily, and a requirement for employers to inform and consult unions recognised under the statutory procedure on their training policies and plans.[6]
[6] The process undertaken by a union which seeks to be recognised as representing a bargaining unit[8] is commenced with an application for recognition.[9] If the parties are able to agree on both the appropriate bargaining unit and that the union should be recognised to conduct collective bargaining[10] on behalf of the workers who make up the unit, then the statutory recognition procedure comes to an end.[11] If, however, an employer does not respond to a union’s request or rejects the request, the union can apply to the Central Arbitration Committee (‘CAC’) to decide the appropriate bargaining unit and whether the majority of workers in that unit support recognition.[12] Once the CAC becomes involved in the process, the Act provides for a number of tests which need to be satisfied before the CAC can proceed with an application for recognition.[13] Presuming these prerequisites are satisfied, the CAC has a 28 day period in which it can attempt to get the union and employer to reach agreement on the appropriate bargaining unit.[14] If agreement cannot be reached, the CAC is required to determine the appropriate bargaining unit in accordance with prescribed criteria.[15] In circumstances where the bargaining unit so determined is different from that initially proposed by the union, the CAC is required to decide whether at least 10 per cent of the bargaining unit are members of the union and whether a majority of the workers in the bargaining unit would be likely to favour recognition before continuing to process the application.[16]
[7] Where the CAC is satisfied that a majority of the workers in the bargaining unit are members of the union making the recognition application, the CAC is empowered to issue a declaration of recognition without the need for a ballot.[17] If, however, a recognition ballot is required,[18] a union will only achieve recognition status if the majority of those who voted support recognition and if at least 40 per cent of the workers constituting the bargaining unit support recognition – undoubtedly a high threshold.[19]
[8] Once recognised, the union and the employer are required to try to reach agreement for the conduct of collective bargaining. Where agreement cannot be reached, either party can apply to the CAC for assistance.[20] The CAC will then actively try to help the parties reach agreement. However, if this proves unsuccessful, the CAC is required to specify the method of collective bargaining.[21] Any such imposed method of collective bargaining will have effect as if it were a legally binding contract between employer and union, and can be enforced by an order for specific performance. Furthermore, a failure to comply with such an order can constitute contempt of court.
[9] John Hendy has characterised the provisions
of the then Bill as generally good, but has questioned the adoption of
American-style
workplace ballots to support union recognition. He makes the
point that such a system has resulted in a ‘rock bottom’
statistic
for collective bargaining (18 per cent of all workers), and has also drawn
attention to the highly complex recognition
mechanism, enforceable not in the
Employment Tribunals but only by an application for specific performance in the
courts.[22]
[11] The constitutional underpinning of the Conciliation Act is found in s 51(xxxv) of the Australian Constitution. This section provides the Commonwealth Parliament with a power to make laws with respect to ‘conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one State’.
[12] A central feature of the Conciliation Act was its recognition of the right of associations of employers or employees to be registered and thereby recognised as representing the interests of their members in industrial disputation.[24] In enacting these provisions, the Commonwealth Parliament relied not only on s 51(xxxv), but also on the Australian Constitution’s incidental power located in s 51(xxxix), which gives the Commonwealth Parliament the power to make laws with respect to matters that are incidental to any powers granted by the Constitution to the Parliament.[25]
[13] In Jumbunna Coal Mine, No Liability v Victorian Coal Miners’ Association (‘Jumbunna’),[26] a constitutional challenge was brought against, inter alia, the registration provisions of the Conciliation Act on the basis that, in enacting these provisions, the Commonwealth Parliament had exceeded its powers by conferring on registered associations the status of corporations and investing them with the power of holding property and of suing for fees and contributions. Furthermore, it was submitted that as these incidents and powers were inseparable from the scheme of registration which was a vital part of the Conciliation Act, the whole enactment was unconstitutional and void.[27]
[14] Before one can begin to examine why it was that the High Court upheld the validity of the Conciliation Act’s registration provisions it is important that some of the background to the Jumbunna decision be explained, for that background illuminates the fundamental significance of the decision to the union movement in Australia.
[15] One of the consequences of the formation of the Australian federation in 1901 was the abolition of State customs barriers, which in turn led to large amounts of subsidised coal being transported from the State of New South Wales (‘NSW’) to Victoria. In response to this influx of cheaper coal, Victorian coal mining companies at Jumbunna and Outtrim in Victoria advised that they were going to reduce wages so as to remain competitive with the cheaper NSW coal. This led to the formation of the Victorian Coal Miners’ Association (‘the Association’) and a recognition strike by Victorian coal miners that lasted for 70 weeks. The employers refused to recognise the Association and, defeated, the miners eventually went back to work. However, upon returning to work, those miners who were members of the Association found that they were being dismissed or harassed because of their union membership. The Association therefore applied to the Industrial Registrar of the Conciliation and Arbitration Commission to be registered as a federal organisation.[28] The employers responded by challenging the validity of the registration provisions in the Conciliation Act.
[16] In essence, what was at stake in the
Jumbunna case was the very right of Australian workers to be represented
by a union in circumstances of industrial
disputation.[29] In
Jumbunna, the High
Court[30] upheld the validity of the
registration provisions of the Conciliation Act on the basis that they
were incidental to the Commonwealth Parliament’s powers pursuant to s 51
(xxxv) of the Australian Constitution. In so finding, the High Court
acknowledged the right of unions (and employer organisations) to become
registered under the federal
legislation for the purposes of being the
recognised representatives of their members’
interests.[31] Justice
O’Connor emphasised that if the Commonwealth’s conciliation and
arbitration power was to be effectively exercised
so as to bring about the
settlement of disputes, it must be by bringing the power to bear on
representative bodies standing for groups
of
workers.[32] In particular, his
Honour held that:
The end aimed at by the Act in question here is the prevention and settlement of industrial disputes extending beyond any one State by conciliation and arbitration. It may well be conceded that there is no general power to prevent and settle industrial disputes by any means that the legislature may think fit to adopt. The power is restricted to prevention and settlement by conciliation and arbitration. Any attempt to effectively prevent and settle industrial disputes by either of these means would be idle if individual workmen and employees only could be dealt with. The application of the ‘principle of collective bargaining’ not long in use at the time of the passing of the Constitution, is essential to bind the body of workers in a trade and to ensure anything like permanence in settlement. Some system was therefore essential by which powers of the Act could be made to operate on representatives of workmen, and on bodies of workmen, instead of individuals only. But if such representatives were merely chosen for the occasion without any permanent status before the court, it is difficult to see how the permanency of any such settlement of a dispute could be assured. Even when the dispute is at the stage when it may be prevented or settled by conciliation, the representative body must have the right to bind and the power to persuade not only the individuals with whom the dispute has arisen, but the ever changing body of workmen that constitute the trade.[33 ]
[21] Once registered, a union is bestowed with certain obligations which are designed to ensure that the conciliation and arbitration system operates effectively. In particular, in circumstances where alleged industrial disputation arises, the union is required to notify the Commission of the dispute.[44] Upon notification of a dispute the Commission is first required to attempt conciliation,[45] and if that proves unsuccessful, arbitrate to resolve the dispute.[46] Upon an arbitrated resolution of a dispute an award is made, which the WRA expresses to be binding not only on those persons who were a party to the dispute but also on certain other persons including any successor, assignee or transmittee, whether or not to or of the business or part of the business of an employer who was a party to the industrial dispute.[47]
[22] The WRA has significantly limited the jurisdiction of the Commission to resolve industrial controversies by the traditional mechanisms of conciliation and arbitration. In particular, awards are limited to 20 specified ‘allowable matters’, and new awards can only specify minimum wage rates (that is, paid rates awards are precluded in furturo).[48] These provisions obviously constrain the role of registered organisations in representing the interests of employees.
[23] Whilst the process of registration confers a right of recognition it should be noted that this right is not unfettered. To this extent, the representative capacity of a union is circumscribed by its eligibility rules and whether those rules encompass the workers who are involved in the disputation.[49] However, assuming this threshold matter is established, a registered union will, without more, be recognised as being representative of its members’ interests.
[24] One
object, expressly stated, of the Conciliation Act was to
‘facilitate and encourage the organisation’ of unions of employers
and employees, for, as Higgins J said in 1911,
without such organisation – at all events on the side of the employees – the arbitration system and the industrial agreements are unworkable ... It may seem very shocking in some quarters, but it is my clear duty, in obedience to the law, to treat unionism as a desirable aid in securing industrial peace.[50]
[26] In the Burwood Cinema case, the High Court was called upon to consider whether an industrial dispute could arise from a claim made by the Australian Theatrical and Amusement Employees Association (‘the Theatrical Association’) on behalf of its members, both present and future. What was significant about this case was that the demands were made on a number of employers, some of whom did not, at the time the demands were made, employ members of the Theatrical Association, whilst others had obtained declarations from their employees that they were satisfied with the conditions under which they worked.[54]
[27] In
Burwood Cinema, the High Court
held[55] that the fact that some of
the employers did not engage union members was not a reason to reject a finding
of industrial disputation.
In particular, Isaacs J stated that:
The main question arising in this case is of high importance. It seriously concerns the power of the Commonwealth Arbitration tribunal to settle national industrial disputes efficaciously, completely and justly. The question is whether, upon the true construction of the Constitution, an employer who employs no union labour whatever can be a party to an ‘industrial dispute’ with an organisation of employees, or whether by simply refusing to employ a single unionist he can, so far as his industrial operations are concerned, entirely exclude the Federal power. It is obvious that if he can maintain the latter position the means do not exist anywhere in Australia of preventing or adequately remedying an admitted evil of the first magnitude – the disruption of industry beyond the limits of a State. If the Commonwealth tribunal, in making awards is compelled to exclude all employers
declining to employ unionists, and thereby to leave them free from Federal arbitration as to wages, hours and other conditions of labour, a formidable obstacle exists to awarding terms which are just to the actual parties and to the public, without giving the employers who discriminate against unionists an unfair advantage over their competitors. That in itself must produce inequalities and naturally cause dissatisfaction and instability, and so contribute materially to the disturbance of industrial peace.[56]
[29] The question which the Burwood Cinema decision left unresolved, however, was whether an industrial dispute could arise when a union brought a claim concerning the employment conditions of persons who were not members of the union. This matter was determined in the Metal Trades case, in which four unions served on various employers demands concerning, inter alia, the wages and conditions of employment of persons who were not members of the unions.[57]
[30] In Metal
Trades, the High Court held[58]
that a union was able to validly create an industrial dispute in relation to the
employment conditions of employees who were not
members of the
union.[59] In so finding, the High
Court further emphasised the extent to which unions are recognised as being an
integral part of the industrial
relations system. In particular, Rich and Evatt
JJ stated:
Nor does the fact that the demand made by the unionists extends to the case of employers who do not employ unionists at all, prevent the creation of an industrial dispute upon the subject matter of the terms and conditions which should be observed by such employers in employing such non-unionists. In such cases, the union has an equally direct concern in removing the obstacles to the employment of its own members and to the maintenance and protection of the union standard of wages, even though the removal of such obstacle by the granting of the demand will incidentally benefit persons, non-unionists, who are not parties to the dispute but the terms of whose employment by their employers (parties to the dispute) are the subject matter of the industrial dispute.[60]
[32] The Australian model of recognition by virtue of registration thereby provides a unique point of contrast to the more limited model of recognition contained in the UK Act. By ensuring that recognition flows automatically from participation in the conciliation and arbitration system the Australian model avoids the complications and limitations that arise under the British system, which requires minimum membership levels, secret recognition ballots and the involvement of both the employer and the Central Arbitration Committee in the recognition process.
[33] It is true that, even without registration, under current federal law an organisation can be a participant in an industrial dispute, an aggregation of employees can enter into a collective agreement, individual work contracts will be recognised and individual employees can make an unfair dismissal claim.
[34] Nonetheless, the advantages of registration are tangible: the right of standing in proceedings before the Australian Industrial Relations Commission (either as a party or intervener) is straightforward; the procedural facility to serve a log of claims, and, hence, create a ‘paper’ interstate industrial dispute, advantages a registered organisation legally and procedurally; a registered organisation can safeguard its territorial coverage, specified in its conditions of eligibility rule, both by asserting its right to coverage in demarcation proceedings and by objecting to constitutional rule changes or new registration by competitive groups of employees, (although these rights have been diluted to some extent by the 1996 amendments).
[35] Thus the 1958 statement of J H Portus still has substance: ‘from being associations tolerated by the state [registered trade unions] have become semi-official associations which are given a part in the making and administration of law’.[62]
[36] Notwithstanding this, it would be wrong to suggest that the Australian model is a panacea. With the enactment of the WRA, and the general shift towards a more enterprise focused industrial relations system, a number of limitations to the Australian model have begun to reveal themselves. In particular, the traditional recognition rights which served the Australian union movement well when collectivism and the award system predominated have begun to show signs of strain in recent times with the increasing emphasis on enterprise based agreements, individual contracts and the move towards the stripping back of award provisions.[63]
[37] Recent judgments of the Federal Court raise doubts about whether, in cases where the Court is enforcing freedom of association legislation, it is prepared to require a collective bargaining process as distinct from the negotiation of individual contracts.[64] It could be argued that these recent decisions give a ‘green light’ to individual contracts, but they have not yet been tested before the Full Court of the Federal Court or the High Court.
[38] In a 1994 decision, the Australian Industrial Relations Commission was prepared to make an interim award with a view to thwarting an employer’s attempts to effectively eliminate the role of registered employee organisations in the employment relationship at the Bell Bay aluminium smelter in Tasmania.[65] And in a 1996 decision, where Comalco was offering individual contracts at its aluminium operations at Weipa in Queensland, the Commission was prepared to make an interim award requiring the employer to extend to each award employee the terms and conditions applicable to ‘staff’ contract employees, provided the award employee was prepared to work in accordance with the requirements in the staff contracts.[66]
[39] In the light of the WRA however, some doubt arises as to whether the Commission could or would now apply similar remedies designed to counter the subversion of collective agreements or awards.
[40] In recent disputes involving attempts to diminish the role of unions, some more subtle than others, unions have increasingly looked to the Federal Court rather than the Commission to enforce anti-victimisation provisions which (perhaps inadvertently) tend to protect the continuing representative role of registered organisations. In particular, it is clear that that the arbitral powers of the Commission have been truncated. Bargaining periods are encouraged and these can only be terminated (so as to open the gateway to conciliation and arbitration) in specified circumstances.[67]
[41] Amendments to the WRA indicate that whilst unions are entitled to act as bargaining agents in the case of Australian Workplace Agreements (‘AWAs’),[68] they are not entitled to become a party to an AWA.[69] Moreover, the Act expressly provides for non-union enterprise agreements, whereby an employer may make an agreement with a majority of employees whose employment will be subject to the agreement.[70] Whilst the WRA requires an employer to inform an employee that if they belong to a union they may request that the union represent them in meetings and conferrals with the employer about the agreement,[71] the union has no right to appear and make submissions before the Commission at the time that approval is sought for the agreement.
[42] The WRA thus represents a challenge to the right of unions in Australia to effectively represent workers’ interests. The clear focus of the WRA is to limit the previous collectivist tradition of industrial relations in Australia, in which unions were an intrinsic part of the arbitrated resolution of industrial disputation. The Act expressly provides that the primary responsibility for determining matters affecting the relationship between employers and employees rests with employers and employees ‘at the workplace or enterprise level’,[72] and that parties will only be able to resort to arbitration ‘where appropriate and within specified limits’.[73]
[43] Given the
attempts (through the WRA) to inhibit the role that unions play in the
Australian industrial relations system, it is interesting to compare the
approach currently
adopted by the Federal Government of Australia with that of
the legislature in NSW.
[45] The provisions dealing with the registration of unions (and employer bodies) under the State Act are located in Chapter 5. These provisions effectively mirror the four-step registration procedure found in the federal WRA.
[46] Once registered, a State organisation[75] (ie union) enjoys the same privileges of incorporation as are granted to unions under the WRA.[76] Upon registration, industrial organisations under the State Act have standing to notify the State Industrial Relations Commission (‘the State Commission’) of industrial disputation,[77] and to participate in the resolution of such disputation.
[47] However, one area where the State Act departs significantly from the WRA is in relation to the role accorded to unions in the processes that lead to the certification of enterprise agreements. In this respect, the State Act establishes a mechanism by which a Full Bench of the State Commission is required to establish principles to be used in determining whether enterprise agreements will be approved.[78] The State Act ensures that unions are an integral part of this process by providing that they are entitled to be notified of review proceedings and to ‘make submissions on the setting or review of the principles for approval’.[79] Furthermore, in circumstances where an application is made to the State Commission for the approval of an enterprise agreement to which employees (as distinct from a union) are a party,[80] the State Act provides that such an application cannot proceed until the union which is a party to an award or agreement that then applies to the employees has been notified of the application.[81] Finally, at any subsequent proceedings for the approval of an enterprise agreement a union is entitled to appear ‘if its members or persons eligible to become members are affected by the agreement’,[82] and there is a limit on the federal concept of ‘allowable matters’.
[48] This
overview of some of the key recognition provisions of the State Act highlights
the extent to which the NSW legislature acknowledges
the significant role that
the union movement plays in maintaining the viability of that State’s
industrial relations system.
In an era which has seen a growth in moves to
decollectivise industrial relations, and an increasing emphasis on enterprise
based
dispute resolution procedures, the State Act serves as an example (in
contrast to the federal WRA) of how it is possible to design a flexible
industrial relations system which is capable of allowing unions to continue to
play a
significant role in the determination of the terms and conditions of
workers.
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