Wattyl Ltd v The Australian Liquor, Hospitality and Miscellaneous Workers Union [1995] IRCA 645

CATCHWORDS INDUSTRIAL LAW - Application for INTERLOCUTORY INJUNCTION - certified agreement - Whether JURISDICTION to restrain proposed breach of AWARD - Scope of ss 418, 419 and 431 of Industrial Relations Act 1988 Industrial Relations Act 1988, ss 170pd, 170pg, 418, 419, 431. Australasian Meat Industry Employees' Union v Frugalis Pty Limited & Anor (1987) 14 FCR 535 Byrne & Frew v Australian Airlines Ltd (1995) 131 ALR 422 The Queen v Australian Teachers Union (No 2) (1993) 48 IR 109 Dunham v Randwick Imaging Pty Limited (1994) 1 IRCR 54 Medcraft v Federated Engine Drivers & Firemen's Association of Australia (1984) 8 IR 211 Thomson Australian Holdings Pty Ltd v Trade Practices Commission (1981) 148 CLR 150 WATTYL LTD v THE AUSTRALIAN LIQUOR, HOSPITALITY AND MISCELLANEOUS WORKERS UNION NI 95/4171 CORAM: MADGWICK J PLACE: SYDNEY DATE: 30 October 1995

IN THE INDUSTRIAL RELATIONS COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY No. NI 4171 of 1995 BETWEEN WATTYL LIMITED Applicant AND AUSTRALIAN LIQUOR, HOSPITALITY & MISCELLANEOUS WORKERS UNION Respondent CORAM: MADGWICK J PLACE: SYDNEY DATE: 30 October 1995 MINUTES OF ORDER THE COURT ORDERS THAT: 1. The application for interim injunction be refused.

IN THE INDUSTRIAL RELATIONS COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY No. NI95/4171 of 1995 BETWEEN WATTYL LIMITED & ORS Applicant AND THE AUSTRALIAN LIQUOR, HOSPITALITY AND MISCELLANEOUS WORKERS UNION Respondent CORAM: MADGWICK J PLACE: SYDNEY DATE: 30 OCTOBER 1995 REASONS FOR JUDGMENT MADGWICK J: In this case the applicants seek "(1) a declaration that a bargaining period purportedly initiated by the respondent pursuant to section 170PD of the Industrial Relations Act 1988 (the Act) is invalid; (2) a declaration that any industrial action taken by the respondent and/or its members against any of the applicants is not protected action as defined by section 170PG of the Act; (3) an order [and an interim order] directing the respondent to take all steps necessary to ensure that its members employed by any of the applicants work and continue to work in accordance with their contracts of employment and the agreement certified by the Australian Industrial Relations Commission on 30 November 1994, being the Wattyl Limited, Pascol Paints Australia Pty Limited and Colors and Chemicals' Enterprise Agreement 1994; (4) damages; and (5) costs." The matter before me was an application for interlocutory order in the terms set out in (3) above. I refused that interim relief on 30th October and reserved my reasons, which I now give. In short, my reason for declining to grant the interlocutory order is that the power to grant such relief is beyond the jurisdiction of the Court. I. The Factual Background of the Present Matter The applicant company owns and/or controls several other companies ("the subsidiary companies") including WP Crowhurst Pty Limited ("Crowhurst"). Those other companies were party to an industrial dispute found to exist by the Australian Industrial Relations Commission in matter number C21100 of 1991 and involving the respondent organisation ("the Union"). Crowhurst was not a party to that industrial dispute. There were in existence at relevant times an award, which bound all the subsidiary companies and the Union, and two certified agreements which, between them, likewise bound all concerned. It may be possible to argue that those instruments impose an obligation on the Union generally not to permit cessation of work. Each of the certified agreements contains a "Disputes Resolution Procedure" clause, the essence of which is the following: "9.1 Other than a dispute on a genuine safety issue the parties are totally committed to the resolution of all disputes without any interruption to normal work. 9.2 Disputes shall be dealt with in the following manner as swiftly as circumstances permit: ... a. If still unresolved [after discussions at various levels between representatives of the Union and the employer], the matter shall be referred to the Australian Industrial Relations Commission for determination." On 27 October 1995 the Union served a notice in the following terms upon the various subsidiary companies and the applicant, including Crowhurst: "Re: Notice of Taking Industrial Action - National Redundancy Agreement In accordance with s 170ph of the Industrial Relations Act 1988, I advised (sic) industrial action will commence on Tuesday 31 October 1995 at the rostered time for the commencement of the first shift on that day. The industrial action will take the form of stoppages of work up to and including stoppages of work for 72 hours, bands (sic) on the working of overtime, bands (sic) on the processing and despatching of finished product, and bands (sic) on the receipt of materials used in the making of paints, varnish and resins (?)." There had been previous correspondence from the Union about this. The Union had on 23 October sent a "Notice of Initiation of Bargaining Period" in purported pursuance of s 170pd(2), Rule 30M and according to Form R8F, making the following points: "That the Union was "involved in an industrial dispute found in C21100 of 1991 and is a party to the following award titled Australian Paint Industry Award 1992 in which Wattyl Australia Pty Limited is also involved. It was said that the agreement that the Union wished to reach and have certified under Division 2 of Part VIB of the Act would concern "the single business and/or part of the single business" [being the Wattyl subsidiaries including Crowhurst]. The matters to be dealt with in the agreement relate to redundancy and in particular the [Union] seeks a national redundancy agreement covering all Wattyl Australia Pty Ltd operations including subsidiaries. The agreement will also provide for withdrawal of redundancy notices concerning the five persons purported to be made redundant by [Crowhurst] on 26 September 1995." The Statutory Framework It may be useful to set out fairly fully what I conceive to be the relevant provisions of the Industrial Relations Act 1988. Overall objects of the Act Section 3 provides that: "The principal object of the Act is to provide a framework for the prevention and settlement of industrial disputes which promotes the economic prosperity and welfare of the people of Australia by: (a) encouraging and facilitating the making of agreements...to determine matters pertaining to the relationship between employers and employees, particularly at the workplace or enterprise level; and (b) providing the means for: (i) establishing and maintaining an effective framework for protecting wages and conditions of employment through awards; and (ii) ensuring that labour standards meet Australia's international obligations; and (c) providing a framework of rights and responsibilities for the parties involved in industrial relations which encourages fair and effective bargaining and ensures that those parties abide by agreements between them; and (d) enabling the Commission to prevent and settle industrial disputes [preferably by conciliation but, where necessary, by arbitration] ..." Part VI - Dispute Prevention and Settlement (ss 88k - 167). According to s 88a, the objects of the Part include, the following: to ensure that "(c) awards are suited to the efficient performance of work according to the needs of particular industries and enterprises, while employees' interests are also properly taken into account" ... "(e) the Commission's functions and powers in relation to making and varying awards are performed and exercised in a way that ... (ii) encourages the prevention and settlement of industrial disputes by the making of agreements under Part VIb." The Part controls, among other things, the general functions of the Commission and its award-making processes. Section 111(1)(e) enables the Commission to make or vary an award to include a provision making breaches of specified terms of the award subject to penalty as for a separate breach on each day the breach continues. Under s 125, the power of the Commission to include a bans clause is exercisable only by a Presidential Member or a Full Bench. A bans clause is defined in s 4, in summary, as a term of an award which prohibits engaging in conduct that would hinder, prevent or discourage, among other things, the performance of work in accordance with the award unless such a term constitutes or forms part of the dispute-settling or prevention procedure specified in the award. Division 8 (ss 164-7) of that Part is entitled "Exclusive Jurisdiction in Relation to Certain Proceedings". Under s 164, an action under a law of a State or Territory does not lie against trade unions or their members in relation to secondary boycotts (which are dealt with by Division 7 of Part VI (ss 156 - 163Q)). Likewise, under s 166, such an action does not lie against an organisation or its members in relation to conduct that is in breach of a bans clause of an award. Under s166A, a tortious action under the law of a State or Territory may not be brought against an organisation or its members in relation to conduct by them "in contemplation or furtherance of claims that are the subject of an industrial dispute" unless the Commission has certified in writing, among other things, that it would cause substantial injustice to a person who might wish to bring such action if the person were prevented from bringing that action while the Commission is exercising its conciliation powers in relation to the dispute. Part VIb - Promoting Bargaining and Facilitating Agreements (ss 170la - 170rc) Objects Division 1 (ss 170LA-170LC) of this Part deals with the objects of the Part and matters of interpretation. Section 170LA(1) states the objects of the Part: "(a) to facilitate: (i) the making and certifying of agreements under Division 2 [this relates to "certified agreements"]; and (ii) the making, and approval of the implementation of, agreements under Division 3 ["Enterprise Flexibility Agreements"]; and (b) to encourage the use of agreements, particularly at the workplace or enterprise level." Under subsection (2) of the same section it is provided that the Commission must, as far as practicable, perform its functions under the Part in a way that furthers the objects of the Act including, in particular, the objects of the Part.