Industrial Relations Commission New South Wales Medium Neutral Citation: Australian Hotels Association (NSW) [2013] NSWIRComm 54 Hearing dates: 18 June 2013 Decision date: 21 June 2013 Before: Walton J, Vice-President Decision: 1.Consent is given to the Rules of the Australian Hotels Association (NSW) (ER 38) being varied in accordance with the variations specified in the marked up copy of the Rules of that organisation that is Annexure 'B' to the Affidavit of Phillip John Ryan sworn 14 June 2013 and filed in these proceedings that day ('the Ryan Affidavit'); 2.That the Rules of the organisation as so altered be in accordance with the terms of those Rules as set forth in Annexure 'C' to the Ryan Affidavit; 3.The variations shall take effect on 18 June 2013. Catchwords: Reference from Industrial Registrar - registered organisations - application - consent to alter Rules - eligibility Rules - statutory conditions for alteration to Rules of organisation - residual discretion - Rules altered - new Rules approved Legislation Cited: Industrial Arbitration Act 1940 Industrial Relations Act 1991 Industrial Relations Act 1996 Cases Cited: Re: The Australian Chamber of Manufactures, New South Wales (1993) 50 IR 87 Category: Principal judgment Parties: Australian Hotels Association (NSW) (Applicant) Representation: R S Warren of counsel (Applicant) Carroll & O'Dea Lawyers File Number(s): R313 of 2013 DECISION 1By application made by a Statutory Declaration dated 9 April 2013, Colin Waller sought the consent of the Industrial Registrar to alter the Rules of the Australian Hotels Association (NSW) ('the AHA' or 'the applicant') pursuant to s 245 of the Industrial Relations Act 1996 ('the Act'). Mr Waller is the Secretary/Treasurer of the AHA. 2The AHA is an industrial organisation of employers registered under the the Act in the category of a 'State organisation'. The AHA was originally registered as an industrial union of employers under the Industrial Arbitration Act 1940, subsequently became registered under the Industrial Relations Act 1991 ('the 1991 Act') and thereafter had its registration under the Act preserved and continued pursuant to s 223(1) of the Act. 3The matter falls to be determined by the Commission as presently constituted in consequence of a reference of the matter by the Industrial Registrar on 26 April 2013. 4It should be noted at the outset that this application was originally listed concurrently with two earlier applications of the AHA in matter numbers R170 and R209 of 2012. These matters were the subject of objections by the Motor Inn, Motel and Accommodation Association of New South Wales and the Restaurant and Catering Industry Association of New South Wales but were discontinued with consent. No objection is taken to the present application. 5Upon the completion of submissions by Mr R S Warren of counsel, who appeared for the AHA, the Commission determined to make orders in favour of the applicant and publish reasons for its decision and orders at a slightly later date. The orders so made are confirmed at the conclusion of this decision. The reasons for decision appear below. 6The application has its genesis in the Annual General Meeting of the AHA held on 9 April 2013. Putting aside minor miscellaneous changes, the alterations which the AHA sought to be approved fell within four broad categories: (i) An extension of the eligibility rule (Rule 5) to embrace unlicensed accommodation establishments; (ii) Alterations to other rules consequent on the extension of the eligibility rule, namely, variations to Rules 4 (the addition of a definition of 'venue') and 18.3 (the establishment of a new criteria for membership of the Accommodation Division); (iii) 'updating' alterations; and (iv) alterations of a formal nature (e.g. the correction of typographical errors). 7The application, so framed, was supported by the aforementioned Statutory Declaration of Mr Waller, an affidavit of Phillip John Ryan sworn on 14 June 2013, a copy of the Rules of the AHA operative as at 29 July 2010 and written and oral submissions for the applicant. 8No other interest opposed the application. 9A detailed and extensive description of the Rule changes was provided in the documents accompanying Mr Waller's Statutory Declaration and Mr Ryan's affidavit. Save for a discussion of the application to extend the eligibility Rule of the AHA and consequential variations to the Rules, I do not propose to more fully describe the alterations proposed beyond that which appears in paragraph [6] above. 10The most significant variation concerned the extension to the eligibility rule of the AHA. Rule 5(a) of the Rules of the AHA, prior to the present application, was in the following terms: Every person, partnership or corporation who or which is an Employer of Labour in an establishment licensed under the Licensing Legislation shall be eligible to be a Member of the Organisation. 11That sub-Rule was proposed to be varied so as to read as follows: Every person, partnership or corporation who or which employs or usually employs labour in the State of New South Wales shall be eligible for membership of the State Organisation provided that:- (i) The labour is employed in a licensed establishment; or (ii) The employer is engaged in the hospitality industry carrying on a business that provides accommodation including (without limitation):- (A) An accommodation hotel; or (B) A guest house; or (C) A motel; or (D) Serviced apartments. 12The effect of the variation sought to the eligibility Rule was that the existing terms of the sub-Rule were preserved as paragraph (i), whilst a new paragraph (ii) was added to embrace unlicensed accommodation establishments of the type specified therein. The alteration sought to Rule 5(a) is coupled with consequential variations to Rules 4 and 18. The written submissions of the AHA described the variation to Rule 18 thus: The principal alteration to Rule 18 is the replacement of existing Sub Rule (3) with a new Sub Rule to broaden the coverage of the Accommodation Division bearing in mind the extension to the eligibility rule to embrace certain types of unlicensed accommodation establishments. 13Section 245 of the Act is in the following terms: Alteration of rules of State organisation (1) An alteration of the rules of a State organisation does not take effect unless the Industrial Registrar consents to the alteration. (2) The Industrial Registrar may consent to an alteration of the rules in whole or part, but must not consent to an alteration unless satisfied that the alteration: (a) complies with, and is not contrary to, this Act and relevant awards or orders of the Commission made under this Act, and (b) is not otherwise contrary to law, and (c) has been made under the rules of the organisation. (3) The Industrial Registrar must not consent to an alteration of the rules of an industrial organisation of employees relating to eligibility for membership of the organisation if, in relation to persons who would be eligible for membership because of the alteration, there is, in the opinion of the Industrial Registrar, another industrial organisation of employees to which those persons might conveniently belong. (3A) The Industrial Registrar must not consent to an alteration of the rules of an industrial organisation of employees to which Schedule 5 applies relating to eligibility for membership of the organisation (being an application for consent made before, or within 12 months after, the date of assent to the Industrial Relations Amendment (Industrial Representation) Act 2012 ) if, in relation to persons who would be eligible for membership because of the alteration there is, in the opinion of the Industrial Registrar, another organisation: (a) to which those persons could more conveniently belong, and (b) that would more effectively represent those persons. (3B) However, subsection (3A) does not apply if the Industrial Registrar accepts an undertaking from the organisation that the Industrial Registrar considers appropriate to avoid disputes as to the demarcation of the industrial interests of the organisation and any other organisation that might otherwise arise from an overlap between eligibility for membership of the organisation and membership of the other organisation. (3C) In determining under subsection (3A) whether an existing organisation would more effectively represent members than the applicant organisation, the Industrial Registrar must have regard to the resources and representative infrastructure of the applicant. (3D) The Industrial Registrar may refuse to consent to an application referred to in subsection (3A) for consent to an alteration of the rules of an industrial organisation of employees if satisfied that the alteration would contravene an agreement or understanding to which the organisation is a party and that deals with the organisation's right to represent under this Act the industrial interests of a particular class or group of employees. (4) If particulars of an alteration of the rules of a State organisation have been lodged with or recorded by the Industrial Registrar, the Industrial Registrar may, with the consent of the organisation, amend the alteration for the purpose of correcting a typographical, clerical or formal error. (5) If the Industrial Registrar consents under this section to an alteration, the alteration takes effect on the recording of the change by the Industrial Registrar. (6) This section does not apply in relation to an alteration of the rules of a State organisation that is: (a) determined by the Industrial Registrar under section 244, 244A or 247, or (b) proposed to be made for the purpose of an amalgamation under this Part. 14The applicant made a submission, with which I agree, that the provisions of s 245 (namely, sub-sections (3), (3A), (3B), (3C) and (3D)),which constrain the rule making power of the Industrial Registrar in relation to 'conveniently belong' considerations, have no application in the present proceedings because the AHA is an industrial organisation of employers. That conclusion must follow from the plain words of the aforementioned sub-sections of s 245 and the absence of any equivalent provisions in the Act concerning industrial organisations of employers. Whilst there are differences between the statutory schemes for alteration to the rules of organisations between the 1991 Act and the Act, nonetheless, I consider that the decision of Cahill J, then Vice-President, in Re: The Australian Chamber of Manufactures, New South Wales (1993) 50 IR 87 at 97 provides support for this conclusion. 15I turn then to the particular conditions attaching to the alteration of the rules of industrial organisations of employers in s 245 in order to consider whether the alterations sought should be approved. Provisions of s 245(2)(a) and (b) 16Having considered in detail the alterations proposed, I have formed the view that the application complies with and is not contrary to the Act and relevant awards or orders of the Commission made under the Act. In particular, the changes to the eligibility rule and consequential variations do not offend the Act. Other changes are either minor, formal or technical. In any event, the proposed alterations comply, where applicable, with the provisions of ss 235 to 243 of the Act. Whether Rule Changes Made in Accordance with Rules of the Organisation 17The applicant made the following submission in relation to the application complying with the Rules of the organisation: 19. The relevant provisions of the Rules of the AHA NSW for these purposes are Rules 16, 17 and 40, and the definition of "Special Resolution" in Rule 4. 20. In this matter the variations to the Rules were adopted at the AGM conducted in Sydney on 9 April 2013 by way of a Special Resolution. 21. Rule 17.1 prescribes that at least twenty one (21) days notice shall be given of any general meeting called to consider any amendments to the Rules (otherwise only seven (7) days notice of such a meeting is required). 22. Rule 17.5 prescribes the business of an AGM which may be, in addition to the presentation of certain reports to members "any other business of which at least 48 hours notice in writing has been given to the President "(paragraph (c)). 23. Rule 40 deals with the process of amending the Rules of the AHA NSW, and in particular sub Rule 40.3 specifically contemplates rule amendments being considered as business at an AGM, and prescribes in that regard that notice of any such amendments are to be submitted in writing to the Secretary Treasurer not less than twenty one (21) prior to the AGM. 24. Sub Rule 40.1 prescribes that any alteration of the rules requires a "Special Resolution", which is defined in sub Rule 4 (zb) and in the case of an AGM means "a resolution passed by three quarters of such of the financial members of the Organisation, who being entitled to vote, do vote in person or by proxy at a Meeting, where not less than 21 days written notice of the resolution has been given...". 25. Rule 40.4 specifies that a Notice of meeting to members in relation to proposed amendments to the Rules must be accompanied by either: (i) a memorandum specifying each proposed amendment and providing an explanation for each such amendment, or (ii) a notice to the effect that such memorandum was accessible on the AHA NSW's web site. Sub Rules 40.5 and 40.6 respectively specify that where such a memorandum was to be placed on the website, that was to occur within 24 hours of the dispatch of the Notice of Meeting to members, and that any member who desired a hard copy of the memorandum would be supplied with a copy for a small fee. 26. Sub Rule 16.1 allows for notices of meetings to members (including an AGM) to be served personally, by post or facsimile or email at the address recorded by the AHA NSW in its Register of members kept under Rule 9. 27. Reliance is placed on the affidavit of Phillip Ryan sworn in these proceedings on 14 June 2013 attesting to compliance by the AHA NSW with the requirements of Rules 17 and 40. In that regard the affidavit discloses that: (iii) on 8 March 2013 (ie more than 21 days prior to the date of the AGM) the President agreed to the proposed amendments to the Rules being included on the agenda for the AGM; (iv) on 11 March 2013 (again more than 21 days prior to the date of the AGM) Notice of the Meeting including notice of the proposals to amend the Rules was dispatched to the members, predominantly by email but where necessary by facsimile or express post; (v) the Notice to members dispatched on 11 March 2013 advised members of the availability on the AHA NSW's website of the Memorandum detailing the proposed alterations and the reasons therefore; (vi) on 12 March 2013 at about 8:30am the said Memorandum was posted on the AHA NSW's website and remains there to date; (vii) at the AGM the meeting was quorate and the relevant resolution was adopted as a "Special Resolution" under the Rules. 18In my view, these submissions conform with the evidence adduced by the applicant in these proceedings and amply demonstrate that the alterations to the Rules proposed by the application were made under and conform with the Rules of the AHA. Conclusion 19In my view the application satisfies the conditions of s 245(2) of the Act. 20It was submitted that the Commission does not possess a residual discretion to refuse consent of the proposed alteration of the Rules, the applicant relying, in this respect, upon the aforementioned decision of Cahill J in Re: Australian Chamber of Manufactures (at 101). Having considered his Honour's judgment and the respective statutory schemes under the 1991 Act and the Act, I am attracted to the applicant's submission in this respect. However, it is unnecessary to finally decide the matter as I consider that, if a residual discretion did exist, it should not be exercised against the AHA. 21In all the circumstances, upon the reference of the matter by the Industrial Registrar, I grant the application of the AHA and thereby consent to the alterations of the Rules of the AHA proposed in the application. Orders 22The Commission records and confirms the orders made on 18 June 2013. Those orders are as follows: (1)Consent is given to the Rules of the Australian Hotels Association (NSW) (ER 38) being varied in accordance with the variations specified in the marked up copy of the Rules of that organisation that is Annexure 'B' to the Affidavit of Phillip John Ryan sworn 14 June 2013 and filed in these proceedings that day ('the Ryan Affidavit'). (2)That the Rules of the organisation as so altered be in accordance with the terms of those Rules as set forth in Annexure 'C' to the Ryan Affidavit. (3)The variations shall take effect on 18 June 2013. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 21 June 2013