[2013] FWCFB 9549

[2013] FWCFB 9549

FAIR WORK COMMISSION

REASONS FOR DECISION

Fair Work Act 2009
s.604 - Appeal of decisions

National Tertiary Education Industry Union
v
RMIT University
(C2013/6733)

VICE PRESIDENT CATANZARITI
DEPUTY PRESIDENT KOVACIC
COMMISSIONER ROE

SYDNEY, 5 DECEMBER 2013

Appeal against decision [[2013] FWC 8829] and Order PR544355 of Commissioner Wilson made on 11 November 2013 in matter number C2013/6705.

[1] On 8 November 2013, Commissioner Wilson issued an interim order 1 (Interim Order) and on 11 November 2013, a decision2 (Decision) and a final order3 (Final Order) in matter C2013/6705, an application pursuant to s.418 of the Fair Work Act 2009 (the Act) filed by RMIT University (RMIT). Commissioner Wilson found that the National Tertiary Education Industry Union (the NTEU) had undertaken unlawful industrial action, and ordered that the action stop. In anticipation of the hearing of this appeal, the NTEU sought a stay of the Interim Order, the Final Order and the Decision and that application was refused by Vice President Catanzariti on 12 November 2013, with reasons for that decision issued on 13 November 2013.4

[2] Given the particular facts of this appeal and the potential effect of the outcome on both parties, this appeal was heard expeditiously on 21 November 2013. Mr H Borenstein of Senior Counsel sought permission to appear for the NTEU and Mr M McDonald of Senior Counsel and Mr J Tracey of Counsel sought permission to appear for RMIT. Given the complexity of the appeal, all parties were granted permission to appear. At the conclusion of the hearing the parties were informed that the Full Bench has decided to grant the NTEU permission to appeal, that the Full Bench upholds the appeal and that the Final Order is quashed. Appropriate orders were issued on the same day 5 and the reasons for that decision are set out below.

Decision at first instance

[3] The industrial action the subject of the s.418 application was summarised by Commissioner Wilson in the Decision as follows:

“[8] On 25 September 2013, the NTEU wrote to Professor M. Gardner, Vice-Chancellor RMIT, advising of various forms of industrial action that it intended to take from 1 October 2013. So far as is relevant to these proceedings, the notification included the following (referred to from this point as the Results Ban):

“Dear Professor Gardner

NOTICE OF INDUSTRIAL ACTION

Notice is given that, in addition to action previously notified, officers, employees and members of the NTEU intend to organise and engage in further industrial action in accordance with Part 3-3 of the Fair Work Act.

I hereby inform you that the nature of the industrial action, to be taken by members of the NTEU employed by RMIT, in the class of eligible employees described in the protected action ballot order handed down on 11 April 2013, is:

...

The following industrial actions commencing 8am on Tuesday 1 October 2013:

• An indefinite ban on the recording, or transmission to the employer of assessment results relating to offshore students provided that the ban will not be applied to the results of students who:

o are graduating students; or

o require such results for purposes of meeting Australian visa requirements; or

o are Australian citizens;

or in respect of results for which an exemption has been granted by the NTEU exemptions committee on the basis of the circumstances of the student.””

[4] It was submitted by RMIT in the proceedings below that the Results Ban is not authorised by the Protected Action Ballot Order (PABO) for the reason that the industrial action is inherently discriminatory and that is not contemplated by the question put to the employees of RMIT in the ballot. The PABO outlines the question to be put to the employees. It was a compounded question, and to the extent relevant, it stated:

“Results

Do you, for the purpose of advancing claims in the negotiation of an enterprise agreement between the National Tertiary Education Industry Union and your employer, authorise industrial action, to be taken separately, concurrently and/or consecutively, in the form of:

...

e) Bans or partial bans on the recording, or transmission to the employer, of assessment results?”

[5] Before the Commissioner, RMIT submitted that:

“24. The current Results Ban applies only to the assessment results of offshore students, and specifically excludes the results of those who are Australian citizens. Accordingly, the Results Ban is inherently discriminatory in that it deliberately targets students who are not Australian.

25. Whilst industrial action provided for in the PABO Application included industrial action in the form of a ban on the recording or transmission of assessment results to RMIT, there was no indication in the PABO Application that the ban would be applied in a way that was inherently discriminatory. At the time of the protected action ballot, the employees were not given notice that any proposed industrial action would include discriminatory action.

26. Industrial action in the form of a ban that is inherently discriminatory is fundamentally different in nature from a ban that is not discriminatory. Such a view is consistent with the provisions of the Act, which display a clear legislative distinction between conduct that is discriminatory and conduct that is not discriminatory in a broad range of circumstances.”

[6] With respect to that s.418 application, the Commissioner made the following findings:

“[15] As a result of s.409, industrial action will only properly be “employee claim action” if it has been authorised by protected action ballot.

[16] The question in this particular matter, of whether an order stopping industrial action should be granted, turns on whether the Results Ban has been authorised by the Protected Action Ballot.

...

[26] Necessarily though, the things which are authorised as protected industrial action are only those things which have been authorised by the protected action ballot. Employees may only have put to them in the ballot those questions authorised by the Protected Action Ballot Order and an Order may only be made which specifies in the question or questions to be put to the employees who are to be balloted “the nature of the proposed industrial action”.

[27] Within the context of the legislative objects; obligations in respect of the performance of the FWC’s functions; and the requirements for protected action ballots referred to, it is evident that “the nature of the proposed industrial action” requires a level of specification in each question, or part of question, that would reasonably inform the voter of what is intended in order that they may make an informed vote.

[28] The significance of the Act’s anti-discriminatory purpose together with the very wide ranging immunities granted by the Act to the industrial action which is authorised by a protected action ballot readily gives rise to this proposition. To find otherwise would potentially lead to partial bans being implemented in any manner of provocative or offensive ways without prior identification in the Protected Action Ballot Order.

[29] For example, could it be said that a permissible partial ban may be to ban the recording, or transmission to the employer, of assessment results relating only to women or only to indigenous students? Could be said, in relation to another question that was put to employees and carried in the ballot, sub-question (d), that it was permissible for a partial ban on responding to enquiries, including by phone, email or in person, but only in respect of enquiries received from persons who are not members of a union?

[30] Very plainly, partial bans of such a character, which may well only be able to operate with the protection of the immunity provisions of s.415, are very different to what a reasonable person would consider to be meant by the phrasing actually used within subquestion (e) and several of the other questions put to the balloted employees. There is nothing within the phrasing used in the questions in the protected action ballot which would signal to a reasonable person that they were being asked to approve industrial activity which might have a discriminatory effect.

[31] Accordingly, I agree with the RMIT’s submission that, had it been the intent of the NTEU to put in place bans that could be inherently discriminatory, such intention would have required separate identification in the Protected Action Ballot Order application. The first purpose of such separate identification would have been to allow a proper argument before the FWC Member hearing the Protected Action Ballot Order, which may well include a debate about whether the question required amendment, or was somehow prevented from being included in the Order. In this respect it is noteworthy that the Full Bench in John Holland did not find that in all cases, the drafting of the questions will be a matter for the applicant, but rather found that this was the proposition in most cases. The second purpose would be to test whether employees might be willing to consider such industrial action, if the FWC was satisfied the question was either permissible under the scheme of the Act, or required to be put because of the findings in John Holland if the Applicant pressed its inclusion in the Protected Action Ballot Order.

[32] I find that the question put to employees in the protected action ballot did not contain any aspect that would allow a reasonable person to view the proposed action as operating in a way that was inherently discriminatory.

[33] Having made this finding, it is then necessary to consider whether the industrial action as actually notified is inherently discriminatory.

[34] As referred to above, the principal application of the ban is in respect of the assessment results of offshore students, with four limited exceptions to the ban — graduating students; students needing the results in order to meet Australian visa requirements; students who are Australian citizens; and students exempted by the NTEU exemptions committee. Of the four limited exceptions, I find that the exemption from the ban in respect of students who “are Australian citizens” is inherently discriminatory and therefore not authorised by the Protected Action Ballot. By exempting from the ban Australian citizens, the ban is discriminatory against people who are not Australian citizens, which amounts to a discrimination on the grounds either of the student’s race, colour, national extraction or social origin.

[35] Having found that the industrial action was not authorised by the Protected Action Ballot, it follows that I must make an Order that the industrial action stop, not occur or not be organised.”

[7] Accordingly, Commissioner Wilson issued an Interim Order in accordance with s.420 of the Act and subsequently the Final Order which included the following terms:

“[2] The Interim Order issued by the Fair Work Commission on 8 November 2013 in PR544350 is set aside with effect from 10.00am Monday, 11 November 2013 and replaced by this Order.

...

[9] The NTEU and its officers, employees and members of the NTEU must:

stop, not organise and not engage in any industrial action involving any Employees whereby bans or partial bans are placed on the recording, or transmission to RMIT, of assessment results of students enrolled at the Singapore Institute of Management and any other RMIT affiliated offshore institution (the Conduct);

not organise, aid, abet, direct, procure, induce, authorise, incite, advise, persuade or encourage any of the Employees to engage in the Conduct.”

Appeal

[8] On 15 November 2013, the NTEU filed a Further Amended Notice of Appeal. The Notice listed the following grounds of appeal:

“Interim Order

1. The learned Commissioner erred in that he failed to accord the NTEU procedural fairness as he did not give the NTEU an opportunity to address him on the making of an interim order (being the course eventually taken by the learned Commissioner) pursuant to s 420 of the Fair Work Act 2009 (Cth) (FW Act).

2. The learned Commissioner failed to consider the question of whether the making of an interim order pursuant to s 420 of the FW Act was contrary to the public interest, as he was required to do under s 420(3).

3. The learned Commissioner erred in ordering the NTEU stop etc the Conduct (as defined in par [8] of Interim Order PR544350), in that the Interim Order goes beyond the Commission’s powers in s 420(2) to order “the industrial action to which the application relates” stop, not occur or not be organised.

4. The learned Commissioner erred in finding at par [4] of the Decision that it was not contrary to the public interest to issue an interim order under s 420 of the FW Act

Final Order and Decision

5. The learned Commissioner acted upon a wrong principle and/or took into account a legally meaningless and irrelevant consideration, namely whether the NTEU’s ban was “inherently discriminatory”.

5A. The learned Commissioner erred in finding that the Fair Work Act had an generalised anti-discrimination purpose.

5B. The learned Commissioner erred in finding that the specific anti- discrimination provisions which he identified in the Fair Work Act had any application to the Protected Action Ballot question (e) or the notified ban.

6. The learned Commissioner erred in finding that the industrial action was not authorised by the Protected Action Ballot, in circumstances where the Protected Action Ballot question authorises “Bans or partial bans on the recording, or transmission to the employer, of assessment results.”

6A. The learned Commissioner erred in finding that it was necessary for the Protected Action Ballot question (e) to explicitly refer to proposed action that was inherently discriminatory.

6B. The learned Commissioner erred in finding that the Protected Action Ballot question (e) which referred to partial bans, did not contain any aspect that would allow a reasonable person to view the proposed action as operating in a way that was inherently discriminatory.

6C. The learned Commissioner erred in finding that the notified industrial action was inherently discriminatory, whatever that phrase means, because it exempted “Australian citizens” from the ban.

6D. The learned Commissioner erred in finding that the discrimination in the notified industrial action by exempting “Australian citizens” was offensive or contrary to the Fair Work Act in a way that required it to be expressly referred to in the Protected Action Ballot question (e).

6E. The learned Commissioner erred in concluding that a reasonable person would not have viewed the Protected Action Ballot authorisation as authorising the notified industrial action by:

(a) construing the intention of the reasonable person by reference to legislative objects of the FW Act and s 578 of the Fair Work Act Act, being matters which did not regulate the notified ban; and/or

(b) failing to consider s 424 of the Fair Work Act and the policy evinced in that section that industrial action should not endanger the personal safety, health or welfare, of the Australian population or part of it.

7. The learned Commissioner erred in ordering the NTEU stop etc the Conduct (as defined in par [9] of Final Order PR544355), in that the Final Order goes beyond the Commission’s powers in s 418(1) to order industrial action that “is not, or would not be, protected industrial action” stop, not occur or not be organised.”

[9] At the hearing of the appeal, Senior Counsel appearing for the NTEU stated that the grounds relating to the Interim Order, being grounds 1 – 4, are not pressed.

[10] With respect to the grounds that are pressed, the NTEU submitted that on its face, the Results Ban falls within the express terms of ballot question (e). It was submitted that the use of the concept of “inherently discriminatory” by RMIT and the Commissioner in referring to the proposed industrial action is legally meaningless as there is no statutory or common law prohibition on discriminatory action per se. Accordingly, the Commissioner fell into error by dealing with the application before him on the basis of an unstated statutory restriction on actions that are, without further specification, described as “inherently discriminatory”.

[11] The NTEU submitted that there is a long line of authority in the Commission that has accepted that the protection action ballot questions may be framed at a level of generality and ballot question (e) is in a form that has been approved on many occasions. The Commissioner, it was submitted, fell into error by applying an erroneous interpretation of the Act concerning anti-discrimination provisions to hold at [27] of the Decision that a greater degree of specificity in the ballot question was required in this case than would otherwise be required.

[12] The NTEU noted that ballot question (e) provided for partial bans and that it would be quite clear and unsurprising to employees of RMIT, which has many campuses and places of business in Australia and abroad and several departments within the campuses, that the question allowed for bans that affected only one campus or department or some part of RMIT’s overall operations. Such a partial ban would readily be described as “inherently discriminatory” in that it affected one part of the operation and not others. However, it cannot be suggested that such a form of “discrimination” called for a more specific ballot question.

[13] For these reasons, it was submitted, the conclusion reached by the Commissioner at [32] of the Decision is legally erroneous in several respects, namely, in its premise about the inherent discriminatory nature of the Results Ban and secondly, and probably consequently, in the conclusion about the need for ballot question (e) to be differently framed.

[14] The NTEU sought permission to appeal on the basis that the appeal raises important questions as to the proper construction and application of the Act and the jurisdiction of the Commission.

[15] In response, RMIT submitted that the Commission should not grant the NTEU permission to appeal as it is not in the public interest to grant permission to appeal in circumstances where the NTEU has advised its members that they are not required to comply with the Commissioner’s Final Order and are entitled to continue to implement the Result Ban which he concluded was unprotected industrial action.

[16] As to the grounds of appeal, RMIT submitted that the Commissioner, at [27] of the Decision, concluded that the “‘The nature of the proposed industrial action’ requires a level of specification in each question, or part of question, that would reasonably inform the voter of what is intended in order that they may make an informed vote.” At [30], the Commissioner concluded that there is nothing within the phrasing used in question 4(e) of the protected action ballot which “would signal to a reasonable person that they were being asked to approve industrial activity which might have a discriminatory effect.” On this basis, he concluded that the industrial action which commenced on 1 October 2013 was not authorised by the ballot and was therefore unprotected. Each of these findings, it was submitted, is correct and should not be disturbed.

[17] RMIT submitted that the inherent character of the Results Ban is discriminatory. The unchallenged evidence before the Commissioner was that the overwhelming majority of students at the Singapore Institute of Management affected by the ban are Singaporean nationals. Students who are Australian citizens are expressly exempted from the ban. It should be noted that the evidence before the Commission suggested that there were in fact no Australian citizens currently studying at the Singaporean Institute of Management, so no Australian citizens would be affected by the Results Ban whether or not the express exemption was in place. In the proceedings before the Commissioner, the NTEU did not dispute that the application of the offshore Results Ban was dictated by the national extraction of the students subject to the ban, although on appeal, the NTEU submitted that national extraction and citizenship were not the same thing.

[18] It was further submitted that there was no evidence before the Commissioner that the NTEU has ever previously imposed bans at RMIT on offshore student assessment, which adversely affects students who are not Australian citizens. Accordingly, there is no past custom or practice by reference to which RMIT employees at the time of casting their ballot might have assumed or understood that the proposed industrial action would include bans which would have a discriminatory effect.

Consideration

[19] In hearing an appeal from a s.418 decision, a recent Full Bench decision in Maritime Union of Australia v Patrick Stevedores Holdings Pty Limited 6 found that:

“[10] In the High Court decision in Coal and Allied Operations Pty Limited v Australian Industrial Relations Commission, the majority judgment characterised a decision-making process in which no one consideration and no combination of considerations is necessarily determinative of the result as discretionary in nature. That was said to include a process in which “the decision-maker is required to make a particular decision if he or she forms a particular opinion or value judgment”. In an appeal by way of rehearing from a discretionary decision so characterised, it was necessary for error in the decision-making process of the type identified in House v The King to be demonstrated before appellate intervention could occur.

[11] Because the jurisdictional fact requirement in s.418(1) is founded upon the Commission member’s perception about the specified matters, and involves to a significant degree an evaluative assessment with a degree of subjectivity (including determining whether particular types of conduct constitute industrial action as defined, and whether industrial action is “threatened, impending or probable”), the decision-making process under the subsection can be characterised as discretionary in the sense discussed in Coal and Allied. Accordingly we consider that in this appeal we should not interfere with the findings concerning the s.418(1) jurisdictional prerequisites in the Decision unless House v The King error is identified.”

(references omitted)

[20] We find no reason to depart from the above approach. Accordingly, the Decision of Commissioner Wilson should not be disturbed unless House v R 7 error is identified. The principles as set out in House v R are as follows:

“It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred.”

[21] We find that, with respect, Commissioner Wilson relied on the wrong principle in finding that the Result Ban, because it is “inherently discriminatory”, was not authorised by the PABO.

[22] It is commonly accepted that in order to obtain a PABO, and accordingly undertake protected industrial action, the party seeking to obtain the PABO must specify in the application the nature of the proposed industrial action. Section 437 of the Act clearly states:

“(1) A bargaining representative of an employee who will be covered by a proposed enterprise agreement, or 2 or more such bargaining representatives (acting jointly), may apply to the FWC for an order (a protected action ballot order ) requiring a protected action ballot to be conducted to determine whether employees wish to engage in particular protected industrial action for the agreement.

...

(3) The application must specify:

(a) the group or groups of employees who are to be balloted; and

(b) the question or questions to be put to the employees who are to be balloted, including the nature of the proposed industrial action...”

(emphasis added)

[23] A Full Bench in John Holland Pty Ltd v AMWU 8 (John Holland) stated:

“[19] Moving now to the construction of s.437 itself, seen in its statutory context, all that the section requires is that the questions should describe the industrial action in such a way that employees are capable of responding to them. If the questions are ambiguous or lack clarity there may be consequences for the bargaining representative and the employees if reliance is placed on the result of the ballot in taking industrial action. If the question or questions give rise to ambiguity, the conclusion may be reached that the industrial action specified in a notice under s.414 was not authorised by the ballot and that the action is not protected for the purposes of s.409(2). It is true that ambiguity or lack of clarity in the description of the industrial action is undesirable, but these are matters more appropriate for consideration under other provisions. It follows that in most cases the drafting of the questions will be a matter for the applicant.”

(emphasis added)

[24] Once a PABO is issued by the Commission and industrial action gains support from the employees eligible to vote, the action is an “employee claim action” - assuming the other prerequisites are met. 9 Once proper notice is given in accordance with s.414 of the Act, the industrial action which is supported by the PABO and notified will be protected under the Act, subject of course to any application made pursuant to Part 3-3, Division 6 of the Act to suspend or terminate the protected industrial action.

[25] It is not the case that the nature of the action as identified in the PABO requires a high level of specificity. The Act clearly provides that the PABO must include “the nature of the proposed industrial action” and the Full Bench guidance in John Holland makes clear that the questions should be specific enough such that “employees are capable of responding to them”.

[26] In this instance, employees of RMIT were asked to support the NTEU’s proposed “Bans or partial bans on the recording, or transmission to the employer, of assessment results”. By the inclusion of “partial bans” in the question, the employees were asked to support bans which will potentially impact on some, but not all, of RMIT’s operations and students.

[27] If the concept of “discrimination” is taken at its widest, any partial ban on the recording or transmission of assessment results will be discriminatory as it affects some students differently from others. Accordingly, it cannot be said that the question put to the employees in the protected action ballot did not contemplate industrial action which was discriminatory in its effect because it impacted on some students and not others. As pointed out by the NTEU, discrimination broadly is not prohibited by any law in Australia, although discrimination on certain grounds (eg. race or sex) and in certain areas (eg. employment or provision of goods or services) is prohibited by various legislative instruments, including, to an extent, the Act.

[28] Even if the Results Ban is appropriately characterised as being unlawfully discriminatory, although we make no finding on that issue, we do not consider that the conduct is so different in its nature that it is not contemplated by the ballot as put to the employees, i.e. “Bans or partial bans on the recording, or transmission to the employer, of assessment results”.

[29] There is nothing in the Act which prohibits the taking of industrial action which is discriminatory in its effect because it has a differential impact on particular groups. The greater objects of the Act should not be read to limit the taking of industrial action, particularly in light of the objects in ss.3(f) and 436 of the Act, in circumstances where the Parliament did not expressly prohibit such conduct, or exclude such conduct from the general immunity expressed in s.415 of the Act, as it has done with defamation. 10 Clearly it was and remains open to the Parliament to include such an express prohibition in the Act if it so chooses.

[30] In light of the above, we find that the Commissioner erred in finding that the “inherently discriminatory” Results Ban was not authorised by the PABO. The Commissioner acted on the wrong principle and considered irrelevant material is evaluating the nature of the Results Ban in terms of the wider objects of the Act.

Conclusion

[31] Permission to appeal is granted on the basis that the appeal raises important questions as to the proper construction and application of the Act and the jurisdiction of the Commission. As the Full Bench has found that the NTEU has demonstrated an error in the Decision below, the appeal is upheld and the Final Order and the Interim Order are quashed.