FEDERAL COURT OF AUSTRALIA
Schanka v Employment National (Administration) Pty Ltd [1999] FCA 1334
INDUSTRIAL LAW – determination of preliminary question of law in representative proceedings – issue of proper interpretation of s 170WG(1) Workplace Relations Act 1996 (Cth) (“the WR Act”) which proscribes certain conduct in connection with the making of an Australian Workplace Agreement (AWA) – determination of question against background where facts not agreed between the parties – meaning of “duress” in the context of the WR Act – whether “duress” should be treated as a technical legal term given its ordinary common law meaning – whether the term “AWA” in the context of s 170WG includes a proposed AWA – whether s 170WG should be given a broad or narrow construction.
REPRESENTATIVE PROCEEDINGS – whether a particular applicant has standing to be joined as a party to the proceedings.
WORDS & PHRASES – “duress” – “applied duress”
Workplace Relations Act 1996 (Cth) ss 4, 170NC, 170NF, 170VA, 170VB, 170VF, 170VJ, 170VPA, 170VQ, 170VR, 170VV, 170VZ, 170WB, 170WC, 170WF, 170WG.
Bass v Permanent Trustee Co Ltd (1999) 161 ALR 399, referred to
Yorke v Lucas (1985) 158 CLR 661, considered
Crescendo Management v Westpac Banking Corporation (1988) 19 NSWLR 40, considered
Smith v William Charlick Ltd (1924) 34 CLR 38, cited
Barker v The Queen (1983) 153 CLR 338, cited
Westpac v Cockerill (1996) 142 ALR 289, cited
Project Blue Sky Inc v Australian Broadcasting Authority (1998) 153 ALR 490, considered
Maritime Union of Australia v Geraldton Port Authority [1999] FCA 899, considered
PETER SCHANKA & ORS v EMPLOYMENT NATIONAL (ADMINISTRATION) PTY LTD
NG 461 of 1998
MOORE J
24 SEPTEMBER 1999
SYDNEY
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IN THE FEDERAL COURT OF AUSTRALIA |
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BETWEEN: |
PETER SCHANKA & ORS Applicants
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AND: |
EMPLOYMENT NATIONAL (ADMINISTRATION) PTY LTD Respondent
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DATE OF ORDER: |
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WHERE MADE: |
THE COURT ORDERS THAT:
1. The parties submit short minutes to give effect to these reasons within seven (7) days.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
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IN THE FEDERAL COURT OF AUSTRALIA |
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NG 461 of 1998 |
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BETWEEN: |
Applicants
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AND: |
EMPLOYMENT NATIONAL (ADMINISTRATION) PTY LTD Respondent
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JUDGE: |
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DATE: |
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PLACE: |
REASONS FOR JUDGMENT
1 This judgment concerns an issue which has arisen in proceedings under the Workplace Relations Act 1996 (Cth) ("the WR Act") brought as representative proceedings under Pt IVA of the Federal Court of Australia Act 1976 (Cth)(“the FC Act”). I earlier published reasons for judgment on a similar issue on 9 September 1998: see (1998) 86 IR 283. It is convenient to set out an extract from those reasons as a means of explaining the issue. The reasons commenced at 283:
“On 15 May 1998 an application was filed under s 170VV of the Workplace Relations Act 1996 (“WR Act”) alleging contravention of s 170WG of that Act by Employment National (Administration) Pty Ltd (“ENA”). Section 170WG provides that it is an offence to apply duress to an employee in connection with an Australian Workplace Agreement (“AWA”) which is an agreement regulated by the WR Act concerning terms and conditions of employment and made by an employer and an individual employee. The applicants were named individuals and the Community and Public Sector Union (“CPSU”). The proceedings were instituted as representative proceedings under Part VIA of the Federal Court of Australia Act 1976 (“FC Act”). On 31 July 1998 ENA filed a notice of motion raising several issues. The principal issue was whether an order should be made under s 33N of Part VIA of the FC Actthat the proceedings no longer continue as a representative proceeding. It is now common ground that the CPSU should not be a party to the proceedings. Of the named applicants Mr Peter Schanka, Mr Peter Aldridge and Mr Richard Walden wish to continue as applicants. Mr James Burns seeks to be added as an applicant which is opposed by ENA.
The background
The following is the background leading to the representative proceedings. It is drawn from a number of affidavits and other material relied on by both the applicants and ENA. None of the evidence has been tested and some of it is contentious. However it was accepted that the material could, even in those circumstances, be used to deal with ENA’s notice of motion.
The Commonwealth Employment Service (“CES”) was an agency of the Commonwealth engaged in placing people in employment whether employed or unemployed. It operated within the administrative structure of the Department of Employment, Education, Training and Youth Affairs (“DEETYA”). Commonwealth employees engaged in CES’s operations were employed under the Public Service Act 1922 (Cth) (“PS Act”) and their terms and conditions of employment were predominantly regulated by the Australian Public Service, Administrative Services Officers (Salaries and Specific Conditions) Award 1995 and the Australian Public Service, General Employment Conditions Award 1995. Executives in the CES had their terms and conditions of employment regulated by the Australian Public Service, Senior Executive Service (Salaries and Specific Conditions) Award 1995.
In August 1996 the Australian Government announced that a new competitive market would operate in relation to the provision of employment placement services. It announced that there would be a publicly owned provider competing in the new market and CES would cease operations. To that end a company, Employment National Limited (“EN”), was incorporated under the Corporations Law with all shares owned by the Commonwealth. EN contracted to DEETYA to provide employment services. The contract was secured through a national tendering process and EN is one of a considerable number of providers of employment services. ENA is a wholly owned subsidiary of EN and has contracted to EN to provide all services, including staff, required by EN to perform its contract with DEETYA. In some of the material in evidence a rigid distinction is not drawn between EN and ENA concerning which company is the employer. I will repeat what the material says and thus it may appear, at times, that EN, and not ENA, is the employer.
In October/November 1997 certain of CES’s functions were transferred to an agency called Centrelink and 2,900 staff who had worked in the CES transferred to that agency. Towards the end of 1997 expressions of interest were sought from staff of the CES to work for ENA. Schanka, Aldridge, Walden and Burns expressed interest in working for ENA. In February 1998 Aldridge received an email advising her that she had obtained a position with ENA. She was invited to respond and did so, indicating she accepted the position.
On about 25 February 1998 the staff of CES were sent a survey that had to be completed by 13 March 1998. It asked each employee to indicate their preference for a number of options concerning future employment. The survey form said that by indicating a preference the employee was not committing themselves to an option nor was a guarantee being provided that their preference would be met. The options were employment in EN, voluntary retrenchment, redeployment to Centrelink (while remaining a member of the Australian Public Service) or redeployment elsewhere within the Australian Public Service. On 25 February 1998 Walden received a letter offering employment with ENA. It provided:
I am pleased to be able to invite you to join Employment National (Administration) Pty Ltd, as Associate Consultant, from the 1st of May 1998. This position will be initially located at Sydney CBD.
As you are aware, we are currently developing the employment framework with existing employees and these will be finalised and reflected in a Certified Agreement before you transfer across to us on the 1st of May. The terms and conditions in this agreement will incorporate the Government guarantees announced in December 1996 and will reflect the employment arrangements outlined in the Employment Relationship Agreement and the Personnel Policies and Procedures Manual, under which current staff are employed. Any movement in remuneration that arises from the current DEETYA negotiations on a certified agreement for Network staff will also be incorporated.
Should you have any questions in relation to these arrangements, or should you wish to review any of the documents I have referred to, please see your Business Manager.
As you would appreciate, it is necessary or [sic] Employment National to continue to manage the Network until 30 April 1998 and you will contribute to the successful finalisation of that contract.
In the meantime, I need to know for planning purposes, if you intend to take up the offer of employment and I would be grateful for advice of your intentions by 4 March 1998.
I look forward to working with you to achieve our goal of making Employment National the market leader in employment services.
Yours sincerely, I accept, subject to the finalisation of a
Satisfactory employment framework.
Bob Hall
Regional Manager Richard Walden
Sydney Metropolitan Region
Burns received a letter in the substantially same terms dated 26 February 1998. On 27 February 1998 Burns signed the letter of invitation and returned it to the manager of ENA who had sent him the letter of 26 February 1998. Walden took a similar step on 3 March 1998 by emailing an acceptance “subject to finalization of a satisfactory employment framework”.
On 20 March 1998 the board of ENA passed a resolution in exercise of powers thought to be conferred by s 81C(3) of the PS Actwhich provides:
For the purpose of facilitating a transfer of persons into the employment of a Commonwealth authority, the Commonwealth authority may, notwithstanding anything in any other law (other than an industrial award), determine any special terms or conditions of employment that are to apply to the persons.
This section applies when the Prime Minister has certified that a function performed by persons appointed or employed under the PS Act is to be performed by a Commonwealth authority. It provides a mechanism for the transfer, by operation of law, of the employment of employees by the Commonwealth in the Australian Public Service to employment by the relevant authority. A Commonwealth authority is defined to include a company in which the Commonwealth has a controlling interest: see s 7 of the PS Act. The exercise of this power by the board appears to have proceeded on the assumption that EN or ENA (which is the relevant Commonwealth authority performing the function is not clear and may have been relevant to the valid operation of s 81C) would be performing functions formerly performed by members of the Australian Public Service employed under the PS Act.
On 22 March 1998 the managing director of ENA sent a memorandum to staff of the CES. It read:
Today the board has authorized me to make the following announcement regarding recruitment to Employment National.
1. Basis of Employment – Your Choice
Staff joining Employment National on or before 30 April 98 may elect, at their discretion, to work under the terms of an Australian Workplace Agreement (already signed by some 250 colleagues) or to work under terms identical to those of the AWA but without the formal agreement (as determined by the Board today under s 81c [sic] of the Public Service Act).
In due course, pending proceedings in the AIRC, a Certified Agreement will be offered to staff.
2. Salaries and Bonuses – Further Benefits
All staff joining Employment National from the CES will receive the financial benefits agreed by the Network with DEETYA, specifically: 2% salary increase plus a $500 bonus.
In addition to this, staff joining employment National from the CES on or before 30 April 98 will receive a further 2% salary increase and a further $500 bonus on 1 December 98.
3. Timing
To enable staff to fully consider this offer the closing date for acceptance has been extended until 3 April 98.
A further and more detailed memorandum was sent shortly after to staff of the CES. The memorandum indicated that EN was seeking to put in place the certified agreement as soon as possible and it would replace the determination that the board had earlier made. The memorandum included:
All operational staff (excluding Business Managers) who have signed up to date on AWAs can transfer to the determination made by the Board if they wish. Similarly, you can elect to sign an AWA, and not fall under the determination. The option is yours.
At this point EN was managing the operation of CES and had been doing so since December 1997. On 2 April 1998 CPSU wrote to ENA threatening legal action if the determination made under s 81C(3) of the PS Act was not revoked. As a result of this action by the CPSU, the option that employees might have their employment with ENA regulated by the s 81C(3) determination was withdrawn. This occurred on or about 18 April 1998 though the precise time does not clearly emerge from the material to which I have been referred. From that point any employee accepting employment with ENA had to sign an AWA. In early April 1998 Schanka and Walden received an offer of appointment to the staff of ENA though the letter contained the following:
It is a condition of this offer of employment that you and the Company enter into two Agreements: firstly, an Employment Relationship Agreement which is an Australian Workplace Agreement (AWA) made under the provisions of the Workplace Relations Act 1996 and secondly, an Agreement to terminate that AWA when a Certified Agreement is made and certified by the Australian Industrial Relations Commission. Copies of both Agreements are included in the Information Kit that accompanies this letter.
The letter went on to detail the process that would lead to the signing of the AWA and how information would be provided concerning it. It nominated a person who could answer any queries. It also contained an explanation about the termination agreement. As stated in the letter, it was accompanied by an information kit. Burns received a similar letter on 1 April 1998.
On 6 April 1998 the CPSU issued a bulletin informing members that it was not necessary to sign an AWA if they had been offered a job in EN and wanted to take it up. The bulletin said:
If you sign an AWA then you accept those employment conditions until and unless we can improve them through a certified agreement. If you agree to transfer without an AWA, then at the very least your conditions will be those outlined in the AWAs, and if our legal challenge is successful they will be better.
By email dated 15 April 1998 Burns indicated he did not wish to sign an AWA but wished to be transferred under s 81C(3) of the PS Act. On 20 April 1998 he was advised that the option under s 81C(3) was no longer available and, accordingly, Burns declined the offer of employment. Also on 20 April 1998 Aldridge was told that if she did not sign an AWA she would not have a job with ENA. On 22 April 1998 Aldridge accepted an offer of employment and signed an AWA. On 23 April 1998 Schanka was told that if he did not sign an AWA his offer of employment would be withdrawn. That day he signed one. On 29 April 1998 Walden accepted his offer of employment and signed an AWA.
On 30 April 1998 the CES ceased to function. At that time there were 4,400 employees employed in its various operations. Two thousand had accepted an offer of voluntary retrenchment, 450 had transferred to Centrelink, 150 were to be retrenched voluntarily later in 1998, 600 were declared excess to requirements and 150 would be declared excess to requirements when winding up duties had been completed. The two lastmentioned groups constituted 750 former CES staff who were seeking redeployment.
On 1 May 1998 Schanka, Aldridge and Walden commenced employment with ENA. The declaration made under s 81C of the PS Act transferring certain former employees of the CES to ENA was gazetted on 4 May 1998 effective 1 May 1998. By 12 May 1998 1,100 people who had been employed in the CES had taken up employment with ENA. 400 of them were temporary staff and 930 were employed on AWAs.
The relevant legislative framework
In order to understand the issues arising in ENA’s notice of motion it is necessary to set out various provisions of the WR Act and also the FC Act. Section 170WG of the WR Act provides:
(1) A person must not apply duress to an employer or employee in connection with an AWA or ancillary document.
(2) A person must not knowingly make a false or misleading statement to another person with the intention of persuading the other person to make, or not to make, an AWA. (Emphasis added)
It is contravention by ENA of s 170WG(1) that is alleged in the application.
Contravention of that provision exposes a person to a civil penalty which may be enforced in the way provided in s 170VV which reads:
(1) An eligible court may make an order imposing a penalty on a person who contravenes a penalty provision.
(2) The penalty cannot be more than $10,000 for a body corporate or $2,000 in other cases.
(3) An application for an order under sub-s (1) that relates to an AWA or ancillary document may be made by a party to the AWA or ancillary document. (Emphasis added)
These provisions are found in Pt VID of the WR Act which contains, in s 170VA, various definitions. The relevant definitions are:
employee has a meaning affected by s 170VB
employer has a meaning affected by s 170VB
…
party, in relation to an AWA or ancillary document, means the employer or employee.
It can be seen that these definitions are affected by s 170VB which provides:
(1) So far as the context permits, a reference in this Part to an AWA or ancillary document includes a reference to a proposed AWA or ancillary document.
(2) In relation to a proposed AWA or ancillary document, a reference to the employer or employee is a reference to the person who will be the employer or employee when the AWA or ancillary document starts to operate.
The contentious elements of this statutory scheme are first what is comprehended by the notion of applying duress referred to in s 170WG and secondly whether “party” in s 170VV includes a person who was asked to become a party to an AWA but did not become a party."
2 I will refer shortly to several further provisions of the WR Act that are relevant.
The subsequent course of the litigation
3 Employment National (Administration) Pty Ltd ("ENA") sought leave to appeal against the judgment of 9 September 1998. The application for leave to appeal was heard by a Full Court on 1 March 1999. The parties have since provided me with a copy of the transcript of the proceedings before the Full Court. What emerges from the transcript is that members of the Full Court raised with the parties the prospect of a question or questions being formulated that would address issues of concern to both parties. In the result, agreement was reached between the parties that I would determine certain preliminary questions. They are recorded in the following extract from the transcript:
“The Court: Very well. The court notes the following agreement of the parties that the docket judge determine as a preliminary question and separately from any other questions in the proceeding whether on the proper interpretation of section 170WG(1A), a person can ever be said to have applied duress to an employee in connection with an AWA by requiring the employee to make an AWA as a condition of appointment to the employment be duress or whether duress in section 170WG(1) is limited to the conduct of the alleged perpetrator. Secondly, that the standing of Mr Burns as an applicant be determined by the docket judge at the same time as the question set out above.”
4 Having noted that agreement, the Full Court then refused the application for leave to appeal from the earlier judgment and did so by consent.
5 The matter came before me as docket judge on 25 March 1999. I heard brief submissions from the parties and made orders, the terms of which were provided by the parties, designed to facilitate the further hearing of the matter. Those orders included an order:
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“1. The following question be determined as a preliminary question in the proceedings:
On the proper interpretation of s. 170WG(1):
(a) can a person ever be said to have applied duress to an employee in connection with an AWA by requiring the employee to make an AWA as a condition of appointment to the employment; and
(b) is duress in that section limited to the conduct of the alleged perpetrator.”
7 I also ordered that the standing of Mr Burns as an applicant be determined at the same time as the determination of the preliminary question. On 24 March 1999 the High Court gave judgment in Bass v Permanent Trustee Co Ltd (1999) 161 ALR 399. In that matter the Court considered the circumstances in which it was appropriate for a court to undertake the preliminary determination of questions of law formulated by the parties. I was, having regard to that judgment, concerned to ensure that the procedure that had earlier been agreed during the hearing of the appeal was consistent with the approach of the High Court. To that end I invited submissions from the parties which I heard on 28 April 1999 and I was satisfied that the matter could proceed on the agreed basis. However it became apparent at that hearing on 28 April 1999 that there was likely to be a difference between the parties about the meaning of the preliminary question I had earlier ordered be answered. In particular, counsel for ENA viewed para (a) as raising the question of whether the mere act of requiring an employee to make an Australian Workplace Agreement (“AWA”) as a condition precedent to employment could involve the application of duress. For the applicants’ part, the question was one that would, even if answered in the affirmative, allow for a consideration of the factual circumstances in which the offer of employment and the imposition of the condition precedent occurred. The applicants’ position was that the question was intended to raise the issue of whether it was the conduct of the alleged perpetrator which would establish a contravention of s 170WG and contravention did not require proof of the actual response or reaction of the employee to that conduct.
8 Counsel for ENA submitted that the facts sufficient to enable the question to be answered had been admitted by ENA. The admitted facts were:
“1. That all persons (save for managerial or executive employees) who were offered employment with the respondent in the period from about February to May 1998 inclusive and who were at the time of the said offer employees of the Commonwealth were offered employment by way of a letter which, in so far as it dealt with the requirement to enter into an AWA was in substantially the same terms as annexure VC1 or VC4 to the affidavit of Vivienne Colmer or annexure RH4 to the affidavit of Rod Halstead dated 31 July 1998.
2. That all persons offered employment as described in paragraph (1) above in order to accept such employment were required to sign the letter referred to in paragraph (1) above.”
9 It should be noted that apart from these admitted facts the position remains the same as I described it in my reasons for judgment of 9 September 1998. That is, the background I described in the quoted extract is to be gleaned from affidavits filed by both the applicants and ENA but which has not yet been tested. The facts are not agreed.
Additional legislative background
10 The terms of s 170WG, s 170VV, the relevant parts of s 170VA and s 170VB are set out in the passage from my earlier reasons. It is also desirable to set out a number of other provisions of the WR Act. Section 4 of the Actdefines AWA in the following terms:
“ “AWA” means an Australian workplace agreement under Part VID”
The making of an AWA is dealt with in s 170VF which provides:
“(1) An employer and employee may make a written agreement, called an Australian workplace agreement, that deals with matters pertaining to the relationship between an employer and employee.
(2) The AWA may be made before commencement of the employment.”
Section 170VJ deals with the time at which an AWA starts operating and provides:
“(1) An AWA for a new employee starts operating on the later of:
(a) the day after a filing receipt is issued for the AWA; or
(b) the day specified in the AWA as the starting day; or
(c) the day the employment commences;
and stops operating on the earlier of the following times:
(d) …”
Division 9 of Pt VID contains several provisions proscribing certain conduct. One of them is the central provision in these proceedings, s 170WG. However reference should also be made to s 170WF which provides:
“(1) A person who is not a party to negotiations relating to an AWA must not use threats or intimidation with the intention of hindering the negotiations or the making of the AWA. For this purpose party to negotiations includes a bargaining agent.
(2) This section does not apply to conduct by or on behalf of an organisation of employees the purpose of negotiating a certified agreement, if the conduct is authorised by another provision of this Act.”
Section 170VV(1) to (3) have already been set out. Section 170VV(4) defines what are penalty provisions which, if contravened, expose a person to a penalty. Those defined provisions include s 170WF(1), s 170WG(1) and (2) and s 170VK(4).
Submissions of the Parties
11 The submissions of the parties were first made in writing and later supplemented orally at a hearing on 10 June 1999. Thereafter further written submissions were made on two discrete issues.
12 ENA’s written submissions may be summarised as follows. The starting point was the nature of the amendments made to the Industrial Relations Act 1988 (“the IR Act”) by the Workplace Relations and Other Legislation Amendment Act 1996 (“the 1996 Amendment Act”) (which changed the name of the IR Act to the WR Act). The legislative regime introduced by the 1996 Amendment Act was intended to create workplace relationships in which there would not be unwanted third party intervention. Reference was made to the second reading speech of the Minister for Industrial Relations and an explanatory memorandum circulated in the Senate (where numerous changes were made to the Bill originally introduced by the Minister in the House of Representatives). Reference was made to Astley v Austrust Ltd (1999) 161 ALR 155 at par 71. Before the changes effected by the 1996 Amendment Act, registered organisations were centrally involved in the processes established by the IR Act. Two types of industrial agreements were provided for in the IR Act. Part VIB of the IR Actdealt with certified agreements in settlement (or prevention) of an industrial dispute. Organisations could be parties to such agreements and organisations which were not, and had a relevant interest, had an opportunity to become a party. The other type of agreement, enterprise flexibility agreements, were dealt with in Pt VIB. While such agreements could be negotiated directly between employers (which were constitutional corporations) and their workforce, an opportunity existed for organisations with the relevant interest to participate in the negotiations for such agreements and to become parties to them. The 1996 Amendment Act altered that scheme and materially reduced the role of registered organisations. That was reflected in changes to the objects of what became the WR Actand the introduction of provisions designed to further facilitate direct dealings between employers and their employees.
13 Having identified the legislative background, ENA turned to what was meant by duress. Reference was made to the observations of Isaacs J in Smith v William Charlick Ltd (1924) 34 CLR 38 at 56, Westpac Banking Corporation v Cockerill (1998) 152 ALR 267 at 290 per Kiefel J and Deemcope Pty Ltd v Cantown [1995] 2 VR 44 at 47-48 and 55-56 per Coldrey J. It was submitted that the use of the expression “apply duress” in s 170WG imports the settled meaning of the expression: see Yorke v Lucas (1985) 158 CLR 661 at 667-668 per Mason ACJ, Wilson, Deane and Dawson JJ, and 673 per Brennan J. It follows that there is no duress unless the conduct of the party applying the pressure brings about the intended result (in the present case, the entering of an AWA) and there is then only duress if the party the subject of the pressure entered the transaction because of the pressure. Reference was made to the observations of McHugh JA in Crescendo Management Pty Ltd v Westpac Banking Corporation (1988) 19 NSWLR 40 at 45-46. In ascertaining whether duress has been applied it is necessary to determine whether applied pressure induced the affected party to enter the transaction and, if so, whether the pressure went beyond what the law is prepared to countenance as legitimate. It is the quality of the consent in the particular circumstances that must be considered: see Westpac Banking Corporation v Cockerill (supra) at 289 per Kiefel J and at 276-278 per Lindgren J and also Commonwealth v Verwayen (1990) 170 CLR 394 at 440-441. In support of this construction of s 170 WG, ENA referred to the explanatory memorandum in which it was said that s 170 WG would not prevent an employer from offering employment on the basis that the employee enter into an AWA. Division 8 of Pt VID contemplates that pressure might be applied as part of the negotiations for an AWA during the course of employment. This suggests that duress does not arise when a condition for obtaining employment is entering into an AWA.
14 The initial written submissions of ENA concerning the status of Mr Burns were to the following effect. It was noted that Burns did not sign an AWA and remains in the Australian Public Service. I add, parenthetically, that these facts are not agreed facts, at least in a formal sense, but these facts concerning Burns (which I apprehend may be true of many of the surrounding facts) are not seriously in issue. An application for a penalty for contravention of a provision in Pt VID (which includes s 170 WG) that relates to an AWA may be made by a party to the AWA: see s 170VV(3). Section 170VA contains definitions applicable to Pt VID and the definition of “employee” directs attention to s 170VB. That latter section declares that a reference to an employee is a reference to a person who will be an employee when the AWA starts to operate. Similarly the definition of AWA in 170 VA directs attention to s 170VB which declares that reference to an AWA is, if the context permits, to be treated as a proposed AWA. However, in contrast to s 170MI(3), a party is not defined in s 170VA to include a negotiating party. The effect of these various provisions is that there are no parties to an AWA until it starts to operate and the extended meaning of employee applies only to an employee who is an employee once the AWA starts to operate. Burns is not a party for the purposes of s 170VV(3) nor could he have had duress applied to him as he never entered an AWA. Had it been intended that a person in the position of Burns would have standing and might be the subject of conduct contravening s 170WG, then language such as that used in s 298T(2)(a) would have been deployed. Even if a contravention of s 170WG might arise in relation to a person who does not ultimately enter an AWA, the Employment Advocate can bring the proceedings: see s 83BB(1)(j).
15 The written submissions of ENA were developed at the hearing on 10 June 1999. Counsel for ENA first drew attention to the form of the question in the order of 25 March 1999. It was submitted that the word “and” after para (a) should read “or”. The question, it was submitted, was intended to have the Court determine whether “duress” in s 170WG has the common law meaning or has a meaning limited to pressure by the respondent. If it is the second meaning, it was submitted, the proceedings came to an end as ENA has admitted to requiring persons to sign an AWA. If it had the common law meaning, then it would be necessary to consider whether the proceedings can continue as representative proceedings because the issue would not only be pressure but the circumstances of the particular person who consented. Counsel accepted that ENA’s understanding of para (a) of the question involved treating the clause commencing “by requiring …” as qualified by the word “merely”.
16 In support of ENA’s construction of s 170WG, counsel first referred to s 170VF which provides for an employer and an employee to make an agreement, an AWA, dealing with matters pertaining to the relationship between them. Section 170VF(2) provides that such an agreement may be made before the commencement of the employment. Section 170VJ(1) provides that an AWA for a new employee starts operating on the latest of three specified events. One event is the day the employment commences. Thus an AWA for a new employee will never commence before the employment of the employee has commenced. Reference was made to the definition of AWA, employer and employee found in ss 170VA and 170VB when read together which may be taken to include, respectively, a reference to a proposed AWA, to the person who will be the employer and to the person who will be an employee. A proposed AWA is a reference to an AWA that has been made prior to the employment commencing, as contemplated by s 170VF(2), but before it has commenced to operate because employment has not commenced: see s 170VJ(1)(c). Thus even if s 170WG is directed to duress in connection with a proposed AWA, the proposed AWA is to be seen as an agreement that has been made prior to the employment commencing.
17 Support for this approach, it was submitted, is found in Div 8 of Pt VID which confers, by operation of s 170WC, immunity on both an employer and an employee from action in respect of what is described as “AWA industrial action”. That expression is defined in s 170WB(1) as including an employer locking out an employee for the purpose of compelling or inducing an employee to make an AWA on particular terms and conditions. It was submitted that it would be incongruous for an employer to be able to take action sanctioned by s 170WC to induce existing employees to enter an AWA but not be able to make the signing of an AWA a condition of employment because that involved a contravention of s 170WG. Moreover Div 8 does not provide protection to an employee or employees taking action to stop an employer attempting to compel or induce the employee or employees from entering an AWA.
18 Counsel for ENA drew attention to the provisions concerning certified agreements which were enacted at the same time as, and can be contrasted to, the provisions concerning AWAs. In relation to certified agreements, s 170NC(1) prohibits a person from engaging in specified conduct with the intention of coercing a person to, inter alia, make a certified agreement. A penalty for the contravention of that provision can be brought by, inter alia, a person who will be bound by the proposed agreements: see s 170NF(7)(b). It was submitted, in effect, that if the legislature had wished to proscribe conduct prior to the making of an AWA, even if it were never made, then language similar to that deployed in s 170NC and s 170NF would have been used. To the extent that such conduct is proscribed in relation to an AWA, it is found in s 170WF which is limited to proscribing threatening or intimidating conduct intended to hinder negotiation for or the making of an AWA by a person who is not a party to the negotiations and also s 170WG(2). Section 170WG(2) proscribes the making of a false or misleading statement to a person with the intention of persuading the other person to make or not to make an AWA.
19 Counsel then dealt with what was comprehended by the notion of duress at common law. Reference was made to Crescendo Management Pty Ltd v Westpac Banking Corporation (supra) at 46 per McHugh JA and the judgment of the trial judge in Cockerill v Westpac Banking Corporation (1996) 142 ALR 227 at 270-272 as well as the judgment of the Full Court in Westpac Banking Corporation v Cockerill (supra) at 289, 290 and 291. Reference was also made to Yorke v Lucas (1985) (supra) at 668, 669 and 673.
20 An application for a penalty for contravention of s 170WF or s 170WG may be brought by a person who is a party to an AWA: see s 170VV(3). Counsel for ENA submitted that even though, on its construction, this would mean (on the extended meaning of party being a party to a proposed AWA if ultimately made) a person party to negotiations or subjected to false or misleading statements could not seek a penalty, the more important remedy of an injunction was available: see s 170VZ. It was by injunctive relief that a party to a proposed AWA which was not yet signed or never signed could deal with conduct contravening s 170WF(1) or s 170WG(2). While, on the construction advanced by ENA, there can be no duress till the agreement is signed and no prior injunctive relief could be obtained, the mechanism to protect the employee who has been subjected to duress is found in s 170VPA which requires that the Employment Advocate be satisfied that the employee genuinely consented to making the AWA.
21 The submissions of the applicants may be summarised as follows. In their written submissions the applicants first canvassed the form of the question. They took issue with what was perceived to be the approach of ENA that paras (a) and (b) of the question were to be treated as raising one and not two questions. They submitted that two questions were raised. The inclusion of the word “ever” in the first question in para (a) was important. It was submitted that the factual circumstances in which employment might be offered subject to entering an AWA could vary enormously. What constituted duress and when it might arise depended on the circumstances both factual and legislative. Reference was made to Smith v William Charlick Ltd (supra) at 56. Section 170WG(1) is not ambiguous and the words “in connection with an AWA” are of broad import. It was submitted: “It could not be concluded for the purpose of [question 1(a)] that in no circumstances could an offer of appointment to employment conditional upon the entering into of an AWA constitute the application of duress”. Question 1(a) should be answered affirmatively.
22 In relation to question 1(b), the applicants submitted that ENA had focussed on only one of the two senses in which the term duress has been used in the general law. The respondent restricted its attention to situations where a court was considering whether a contract is voidable or restitution should be ordered which involves consideration of whether illegitimate pressure has been applied and that pressure was a factor leading to the making of the contract. However, it was submitted, duress was also used to refer specifically to the conduct of the perpetrator of the duress. In the first of the two senses in which duress was used, which was the sense relied on by ENA, the plaintiff must establish legitimate pressure but the defendant bears the onus of demonstrating that the pressure did not contribute to the victim entering the agreement. Reference was made to Crescendo Management Pty Ltd v Westpac Banking Corporation (supra) at 46 per McHugh JA and Barton v Armstrong (1973) 2 NSWLR 598. The existence of this shifting onus makes it difficult to translate the common law concept in its entirety into a statutory context which is different. The term duress is widely used to describe the pressure applied by the perpetrator. Reference was made to Butterworths Australian Legal Dictionary (1997) at p 324, Halsbury’s Laws of England Vol 9 par 297; Smith v William Charlick Ltd (supra) at 56; Universe Tankships Incorporated of Monrovia v International Transport Workers’ Federation [1983] AC 366 at 385; [1982] 2 WLR 803; Mason v New South Wales (1959) 102 CLR 108 at 126; Patrick Stevedores Operations (No. 2) Pty Ltd v Maritime Union of Australia (No. 3) (1998) 72 ALJR 873, 153 ALR 643, 79 IR 339; Crescendo Management Pty Ltd v Westpac Banking Corporation (supra) at 45-46. It was submitted the terms of s 170WG(1) and its statutory context support the applicants’ contention that s 170WG(1) is directed to the conduct of the perpetrator. The term “AWA” had an enlarged meaning by operation of s 170VB and includes a proposed AWA. That is, an AWA before it is made. Section 170WG(1) focuses on the conduct of the perpetrator. So much is apparent from the use of the word “apply”. It was submitted the construction advanced by ENA would lead to absurd results. First, s 170WG(1) would only operate when the AWA had been made and second, s 170WG(2), but not 170WG(1), would apply to conduct prior to any AWA being made and irrespective of whether it was made. It is legitimate to test a proposed construction of a statute by reference to the consequences of that construction. Reference was made to Cole v Director-General of Department of Youth and Community Services (1986) 7 NSWLR 541 at 546 per Mahoney JA and Cooper Brookes (Wollongong) Pty Ltd v FCT (1981) 147 CLR 297 at 319-321. It was submitted the principles in Yorke v Lucas (supra) have limited, if any, relevance but if they did they favoured a construction reflecting the second meaning of duress discussed earlier.
23 In relation to the standing of Burns, the applicants submitted that s 170VV(3) should be construed as giving standing to a person who did not become a party to an AWA but was exposed to proscribed conduct, otherwise the result would be an absurd one. It was no answer to these difficulties concerning standing, it was submitted, to say that the Employment Advocate, by the combined operation of s 83BB(1)(j) and an appropriate regulation, might be able to seek a penalty. Section 170VV(3), in terms, confers the right to seek a penalty on a party only.
24 Further submissions were made by the applicants at the hearing on 10 June 1999. Attention was again drawn to the divergence in views between the parties about the meaning of para (a) of the question. It was submitted that the real issue the parties sought to have determined was raised by para (b) of the question. It was submitted that the applicants did not contend that an employer would have applied duress simply by virtue of the fact that the employer offered an AWA to a prospective employee.
25 Amongst other things, it was submitted that in relation to the construction of Pt VID, it would be unnecessary for there to be an extended definition of AWA, namely a proposed AWA, on ENA’s analysis of the legislative scheme. It was also submitted that the existence of provisions rendering certain action immune, in the sense identified in Division 8, should not result in a narrow construction of s 170WG(1). The provisions do not, or do not necessarily, address the same conduct. In drawing on the provisions concerning certified agreements in construing s 170WG(1), it was submitted that it is important to bear in mind the difference in the language used.
26 In its written submissions in reply to those of the applicants, ENA took issue with what was said to be duress. ENA accepted that duress required conduct of the perpetrator but, it was submitted, it involved more and the result would otherwise be that contravention of s 170WG(1) could arise in relation to a person who welcomed an AWA. As to s 170VV(3), that sub-section concerns applications for an order imposing a penalty that relates to an AWA and contemplates that an AWA has been made. Only a party coerced into making an AWA can apply for a penalty. Sub-section 170VV(3) does not limit the class of person that can apply for a penalty for the contravention of s 170WG(2) and s 170WF(1). A person with a sufficient interest can apply: see Onus v Alcoa of Australia Ltd (1981) 149 CLR 27.
27 Further brief written submissions were made by both the applicants and ENA after the hearing on 10 June 1999. The form of the question was addressed. ENA submitted that the word “ever” should be treated as meaning “without more”. This was not agreed to by the applicants. It appeared to be common ground that even if para (a) was not answered because of the dispute about what it meant, para (b) should be answered. Also addressed was the passage of the 1996 Amendment Act through Parliament. I was provided with agreed material that might constitute extrinsic material bearing upon the meaning of s 170WG(1). However I have not found this material particularly helpful.
28 Last, I was sent brief submissions by both parties concerning the judgment of R D Nicholson J in Maritime Union of Australia v Geraldton Port Authority [1999] FCA 899.
Conclusion
29 In my opinion the proper construction of s 170WG(1) is revealed by posing two related questions. The first is whether s 170WG(1) is concerned about the application of duress but only when an AWA has been made. The second is what is comprehended by the notion of duress in the general law and whether Parliament intended that notion be incorporated into s 170WG(1).
30 Part VID of the WR Act deals with AWAs. In order to determine what is meant by a proposed AWA, it is necessary to ascertain what an AWA is. Sections 4 and 170VA do not define the expression “AWA” in a way that identifies what are its essential elements. The definition of AWA in s 170VA simply gives the expression “AWA” an extended meaning arising, relevantly, from the operation of s 170VB(1). The expression includes a proposed AWA.
31 However, the essential elements of an AWA are made apparent by s 170VF(1) and s 170VO(1)(a). It is clear from s 170VF(1) that an AWA is a written agreement that deals with matters pertaining to the relationship between an employer and an employee though s 170VC limits the class of employer or employee that may enter such an agreement. An AWA must be signed by the parties: see s 170VO(1)(a). It is relatively clear from the combined operation of s 170VF(1) and s 170VO(1)(a) that an agreement becomes an AWA where it is reduced to writing and probably only after it is signed. It is also clear from s 170VF(2) that an agreement which is an AWA may be made before the commencement of the employment. It is palpably clear that an AWA can exist before the employment commences.
32 However an AWA does not operate until at least the employment has commenced: see 170VJ(1)(c). The date on which an AWA commences to operate is an important feature of the legislative scheme which provides that an AWA operates to the exclusion of any award which might otherwise apply to the employee’s employment: see s 170VQ(1). The time at which an AWA starts operating also bears upon its relationship with a state award or state agreement: see s 170VQ(4), and probably its relationship with a state law: see s 170VR(1). A clear distinction is drawn in Pt VID between the existence of the agreement which is an AWA and the time at which it commences to operate. In my opinion an AWA comes into existence when an agreement is made of the type referred to in s 170VF(1). It follows, in my opinion, that s 170VJ(1) does not impliedly identify the point at which a proposed AWA becomes an AWA. Rather a proposed AWA is a draft or proposed agreement which, if made, would become an AWA. A proposed AWA becomes an AWA when the agreement is made in conformity with s 170VF(1) and probably 170VO(1)(a).
33 This dichotomy between a proposed AWA and an AWA, being an agreement of the type I have just discussed, accords with the scheme of Pt VID. It is recalled that an AWA, as identified by s 170VF(1), is a signed written agreement. Such an agreement undergoes a process of approval by the Employment Advocate: see s 170VPB(1). One of the requirements for approval of an AWA is that the employee has received a copy of the AWA prior to signing it: see s 170VPA(1)(b). Probably in this context the expression “AWA” is a reference to a proposed AWA. That is, a reference to a proposed agreement in writing that had not yet been signed by the employee. The notion of “proposed AWA” also has relevance in s 170WJ which concerns the authority of a person to sign an AWA on behalf of a body corporate and also s 170WK which deals with the powers of a Secretary of a Commonwealth Department to act on behalf of the Commonwealth in relation to AWAs. Relatively clearly that would include reaching and executing an agreement between the Commonwealth and an employee. In that context the expression “AWA” would include a proposed AWA. There is nothing in Pt VID that, in my opinion, suggests that the dichotomy based on what I view is an AWA and a proposed AWA is an inappropriate or illogical one.
34 The question that then arises is how the definition and extended definition of AWA might operate in Div 9 of Pt VID. That is, should all or any of the references to AWA in that Division be treated as a reference to both an AWA and a proposed AWA. Plainly s 170VA and s 170VB, in combination, direct that a reference to AWA should be treated as including a proposed AWA unless a contrary intention is apparent. Section 170WF(1) prohibits a person using threats or intimidation with the intention of hindering negotiations in relation to an AWA. Also proscribed is such conduct which might hinder the making of an AWA. Necessarily negotiations preceding an agreement are in relation to the proposed agreement. Thus in s 170WF the extended definition of AWA is apt to apply. In other instances the references to AWA in Div 9 is comparatively clearly a reference to the concluded agreement. That is, there is no need to import into them the extended meaning of AWA arising from s 170VB. The critical question in these proceedings is whether that is also true of s 170WG(1).
35 I now turn to consider whether there is evident in s 170WG(1) or the WR Actmore generally an intention that the extended definition of AWA, namely a proposed AWA, does not apply to that sub-section. This raises the question of what is meant by “duress”. I accept that in the general law the concept of duress has, at least in some circumstances, a particular meaning. I will consider that meaning shortly. However if the word does have an established legal meaning then it is probable that Parliament intended it have that meaning in the WR Act. The relevant principle was referred to by Mason ACJ and Wilson, Deane and Dawson JJ in Yorke v Lucas (supra) at 668. In discussing the proper construction of s 75B of the Trade Practices Act 1974 (Cth) their Honours noted:
“Section 75B, on the other hand, in speaking of aiding, abetting, counselling or procuring, makes use of an existing concept drawn from the criminal law and unless the context requires otherwise, there is every reason to suppose that it was intended to carry with it the settled meaning which it already bore: cf Barker v The Queen (1983) 153 CLR 338.”
To similar effect are the observations of Brennan and Deane JJ in Barker v The Queen (1983) 153 CLR 338 at 355-356 concerning the proper construction of s 76(1) of the Crimes Act 1958 (Vic) which provided that a person was guilty of burglary if they entered a building as a trespasser:
“The penal character of s 76(1) requires that any real ambiguity as to the meaning of its provisions be resolved in favour of an accused. An ambiguity which calls for such resolution is, however, an ambiguity which persists after the application of the ordinary rules of statutory construction (R v Adams; Beckwith v The Queen). One of those rules is of particular relevance to the ascertainment of the correct construction of the phrase “as a trespasser” in s 76(1). It is the “well known” rule of statutory construction that, where a technical legal word such as a “trespasser” is used, it is to be presumed that the legislature intends it to have its ordinary common law meaning “unless a contrary intention clearly appears from the context” (per O’Connor J in Attorney-General (NSW) v Brewery Employés [sic] Union of NSW”. [citations omitted]
It is thus necessary to ascertain whether duress should be treated as a technical legal word to be given its ordinary common law meaning.
36 A convenient encapsulation of the authorities relied upon by counsel for ENA of what constitutes duress is found in the judgment of Kiefel J in Westpac Banking Corporation v Cockerill (supra) at 289 when discussing what is economic duress:
"The point of distinction which is relevant for present purposes is that duress, like undue influence, focuses upon the effect of pressure, upon the quality of the consent or assent of the pressured party, rather than the quality of the conduct against which relief is sought – a distinction pointed to in Commercial Bank of Australia Ltd v Amadio and referred to by his Honour, the primary judge, in the present case. The cases, apart from Crescendo Management, which recognised the possibility of “economic” duress, such as Barton v Armstrong and Pao On v Lau Yiu Long emphasise the feature that the pressure applied is so coercive of the will that consent is treated as vitiated.” [citations omitted]
Her Honour then refers to the well known passage from the judgment of Isaacs J in Smith v William Charlick Ltd (supra) at 56.
I accept that this identifies what is comprehended by the notion of duress in cases where a contract is sought to be avoided because one contracting party has been subjected to pressure with the result that there was no effective consent to the agreement. However it does not mean, in my opinion, that the use of the word “duress” or the expression “applied duress” in a legislative provision proscribing conduct necessarily implies a requirement that there not only be conduct of a particular character but that the conduct has a particular result. The word “duress” is apt to describe the conduct of one party which bears upon another party. That second party is subject to that conduct and subject to the duress. The use of the word in this way can be illustrated from the following brief passage of McHugh JA in Crescendo Management v Westpac at 45-46:
“A person who is the subject of duress usually knows only too well what he is doing. But he chooses to submit to the demand or pressure rather than take an alternative course of action.”
It is also illustrated from the following passage from Turner: Australian Commercial Law (22nd ed) at 126:
“Duress is actual or threatened violence to, or the deprivation of liberty of, a person or her or his immediate family or near relatives to pressure or coerce such person into entering into a contract. The duress may be by the other contracting party or by some other person acting on the latter’s behalf. A person who has been coerced into entering into a contract under duress has been deprived of her or his free will to act and thus there is no true consent to the agreement. A contract made under duress is voidable at the option of the party coerced, ie he or she can elect not to be bound by the contract.”
It is further illustrated by the following passage from Cheshire & Fifoot’s: Law of Contract (6th ed) at 401-402:
“Duress at common law, sometimes referred to as legal duress, has traditionally meant actual violence or threats of violence, either directly or through an agent, to the person of a contracting party or to someone close to that person. This narrow notion of duress has been expanded in more modern times to include other forms of pressure, such as economic duress, though the dividing line between duress, pressure and undue influence has been blurred. … The difference between duress and pressure, on the one hand, and undue influence on the other, is that the complaining party is forced unwillingly into a contract in the former and is often only too willing in the latter. However the line between the two is not always clear and it has been argued that duress, at least duress to the person, could be subsumed under the doctrine of undue influence.”
Other examples of the use of the word duress in a similar way are found in the illustrations provided by counsel for the applicants referred to earlier in these reasons. As duress may simply be descriptive of the conduct of a person that might impact on another person the principles in Yorke v Lucas and Barker v The Queen would not dictate a construction of s 170WG(1) that restricted its operation to circumstances in which an AWA was made.
37 The task of a court in construing a statute has recently been addressed by the High Court in Project Blue Sky Inc v Australian Broadcasting Authority (1998) 153 ALR 490. In a joint judgment McHugh, Gummow, Kirby and Haine JJ identified the objects of statutory construction (at 509-510):
“The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute. The meaning of the provision must be determined “by reference to the language of the instrument viewed as a whole”. In Commissioner for Railways (NSW) v Agalianos Dixon CJ pointed out that “the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed”. Thus, the process of the construction must always begin by examining the context of the provision that is being construed.
A legislative instrument must be construed on the prima facie basis that its provisions are intended to give effect to harmonious goals. Where conflict appears to arise from the language of particular provisions, the conflict must be alleviated, so far as possible, by adjusting the meaning of the competing provisions to achieve that result which will best give effect to the purpose and language of those provisions while maintaining the unity of all the statutory provisions. Reconciling conflicting provisions will often require the court “to determine which is the leading provision and which the subordinate provision, and which must give way to the other”. Only by determining the hierarchy of the provisions will it be possible in many cases to give each provision the meaning which best gives effect to its purpose and language while maintaining the unity of the statutory scheme.”
38 Approaching the construction of s 170WG(1) with these principles in mind, it is necessary to consider not only its language but also its apparent purpose in the statutory context in which it appears. Part VID creates a class of industrial instrument which depends upon the agreement of an employer and an employee. Such an agreement is intended ordinarily to displace the effect of an award made under the WR Act, a state award or agreement, or state law dealing with the same, and may displace certain Commonwealth laws dealing with the same subject matter as the agreement: see s 170VQ(2), s 170VQ(4) s 170VR(1) and s 170VR(4). This process of individual agreement making is plainly intended to supplement if not displace, in appropriate circumstances, the determination of working conditions on a collective basis and a basis involving the intervention of an industrial tribunal including the potential exercise of arbitral powers. Evident in this scheme is a policy that any agreement reached between an employer and an employee (or their agents) is reached through a process of real and not illusory negotiation and general agreement. An aspect of that negotiation can include industrial action on the part of the employer or employee: see generally Div 8 of Pt VID, but constraints are placed on the nature of that action. Apart from that element of coercive influence, the process is otherwise intended to be free bargaining. So much is manifest by the provisions in Div 9 and other provisions: see s 170VR(4) which proscribe conduct which might otherwise militate against free bargaining. Not only is conduct proscribed and provision made for the imposition of penalties, but provision is also made for the granting of injunctive relief preventing or restraining proscribed conduct: see s 170VZ.
39 It is consistent with this scheme, in my opinion, to give s 170WG(1) a broad and not narrow meaning. That is, to view it as proscribing conduct occurring during the process of negotiation which could be prevented or restrained by injunction or in respect of which a penalty could be sought. To treat s 170WG(1) as proscribing conduct which has, in fact, lead to an AWA being made by one party (or perhaps both) who has been overborne by another person would limit the utility of the provision as a means of ensuring free bargaining. Effective injunctive relief would not be available to avoid an agreement being made which was the result of free bargaining if it was necessary to ascertain the quality of the consent as a condition precedent to establishing that the conduct was proscribed conduct. Moreover it would only, after the event, expose a person to a penalty for engaging in conduct which has resulted in a process of bargaining at odds with the type of bargaining contemplated by Pt VID. There is no compelling reason, in my opinion, apparent from the language of s 170WG(1) or the legislative scheme in which it appears to treat s 170WG(1) as limited in the way contended by ENA.
40 It is necessary to refer again to the judgment of R D Nicholson J in Maritime Union of Australia v Geraldton Port Authority (supra). In those proceedings the Maritime Union of Australia (“MUA”) and four individuals brought proceedings against the Geraldton Port Authority (“GPA”) and others. It was contended by MUA that GPA had applied duress in contravention of s 170WG(1). It had done so, it was alleged, by making the grant of a licence to a stevedore to operate in the Port of Geraldton conditional on the stevedore agreeing to engage its workforce on AWAs or equivalent agreements under state legislation. His Honour said (at 80-81):
“I also accept that the unlawfulness provided for in s 170WG cannot be presumed to establish the concept of “duress”. What is required is that the concept of “duress” is fulfilled to establish the unlawfulness.
While “duress” is not defined in the WR Act, it is a concept well understood in the law. The rationale of the doctrine of economic duress “is that the law will not give effect to an apparent consent which was induced by pressure exercised upon one party when the law regards that pressure as illegitimate”: Crescendo Management Pty Ltd v Westpac Banking Corp (1988) 19 NSWLR 40 at 45 (per McHugh JA, with whom Samuels and Mahoney JJA agreed).
The rationale for section 170WG “is to ensure that processes that might lead to the making of an AWA occur in a way that ensures that free choice is exercised”: Peter Schanka & Ors v Employment National (Administration) Pty Ltd (Moore J, Federal Court of Australia, 9 September 1998, unreported) at 12.
Duress, “like undue influence, focuses upon the effect of pressure, upon the quality of the consent or assent of the pressured party, rather than the quality of the conduct of the party against which relief is sought”: Westpac v Cockerill (1998) 152 ALR 267 at 289 per Keifel J [sic]. While generally speaking the types of pressure considered to be illegitimate will involve unlawful threats or pressure that amounts to unconscionable conduct, the categories of conduct are “not closed” and “otherwise lawful conduct may in certain circumstances amount to illegitimate pressure”: Crescendo Management Pty Ltd v Westpac Banking Corp at 46.
These general law propositions are applicable to section 170WG. It can be duress in relation to an AWA in contravention of section 170WG to refuse to deal with someone if they do not enter into an AWA with an employee or to not employ someone except on an AWA, or to threaten an existing employee with loss of employment if he or she does not enter into an AWA: Schanka. An enquiry into an allegation of duress for the purposes of section 170WG must involve a consideration of the “possible or probable impact of the conduct” of the party applying duress to the other party: Schanka at 12.”
41 His Honour’s ultimate conclusion was that, as a matter of fact, GPA did not require the stevedore to enter into a particular form of arrangement with its employees. His Honour therefore concluded no finding of illegitimate pressure would be made. I accept that some observations of R D Nicholson J are supportive of the construction of s 170WG(1) advanced by ENA in these proceedings while others are supportive of the construction advanced by the applicants. The meaning of s 170WG(1) as it arises in these proceedings was plainly a matter that was not necessary for his Honour to address both because of the materially different factual circumstances in which the contravention of s 170WG(1) was alleged and a specific finding concerning the absence of any illegitimate pressure. The above passage from the judgment of R D Nicholson J was referred to by Ryan J in Maritime Union of Australia v Burnie Port Corporation [1999] FCA 1196 though Ryan J did not expand upon what might constitute a contravention of s 170WG(1).
42 In my opinion s 170WG(1), properly construed, applies to the conduct of a person applying duress irrespective of whether that conduct actually results in the making of an AWA and irrespective of whether, as a matter of fact, the party subjected to that conduct did not freely make the AWA if one was made.
43 That is not to say that in ascertaining whether conduct contravened s 170WG(1), the potential effect of the conduct on the exercise of free will by the person to whom it is applied is irrelevant. It plainly is in this way. The conduct of the contravening party must involve illegitimate pressure. I doubt that the mere fact that an employer offers employment on the basis that an AWA in certain terms must be made, is illegitimate pressure. It would do no more than place the potential employee in the position of either declining or accepting the employment on those terms and regulated that way, that is by an AWA. Something more is probably necessary and whether pressure is illegitimate will ultimately depend on the factual context in which the allegation of duress arises. But it must be pressure that is likely to have the effect of denying the exercise of free will if an AWA was made. It also must be intended to have that effect.
44 In the result, it is inappropriate to answer para (a) of the question as its meaning is in issue. Paragraph (b), as presently framed would, consistent with these reasons, be answered in the affirmative. However the question is not, in my opinion, as precise as it might be having regard to the way the issues have developed and been refined during argument. A court can, of its own motion, reformulate a question: see Attorney-General (Cth) v Breckler (1999) 163 ALR 576. Subject to any submissions being made in opposition to a reformulation of the questions, I propose to vary the order I made on 25 March 1999 so as to read:
1. The following questions be determined as preliminary questions in the proceedings:
(a) Can a person, by their conduct, contravene s 170WG(1):
(i) before an AWA is made by the person to whom the conduct was directed;
(ii) irrespective of whether an AWA is made by a person to whom the conduct was directed; or
(iii) if an AWA is not made by a person to whom the conduct was directed.
It follows from the reasons given that I would answer each of the above in the affirmative and allow Burns to be a party to the proceedings. If Burns never intended to make an AWA, a fact asserted by ENA in its submissions, and that was known to ENA, then it may be that ENA, by its conduct, could not have intended Burns to make an AWA against his free will. However even if that is so, it does not, as the facts are presently proved or agreed, deny him standing.
45 The parties may, within seven days, provide written submissions on the revised form of the questions and should within seven days, submit short minutes to give effect to these reasons.
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I certify that the preceding forty-five (45) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Moore. |
Associate:
Dated: 24 September 1999
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Counsel for the Applicants: |
R Kenzie QC with C Howell |
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Solicitor for the Applicants: |
Steve Ramsey, Community & Public Sector Union |
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Counsel for the Respondent: |
J Trew QC with L Kaufman |
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Solicitor for the Respondent: |
Andersen Legal |
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Date of Hearing: |
10 June 1999 |
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Written Submissions finalised: |
3 August 1999 |
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Date of Judgment: |
24 September 1999 |
