FEDERAL COURT OF AUSTRALIA

Keppel Prince Engineering Pty Ltd v AFMEPKIU [2001] FCA 1637

INDUSTRIAL RELATIONS – injunctive relief sought – whether serious question to be tried - whether conduct in contravention of order of Australian Industrial Relations Commission – whether engaging in industrial action in respect of employment of employees whose employment is subject to relevant agreement or award – whether unions should be restrained from committing a tort.

Workplace Relations Act 1996 (Cth):  ss 99, 127(1), 166A, 170MN

BHP Steel (AIS) Pty Ltd v Construction, Forestry, Mining and Energy Union (2000) 102 IR 275  distinguished

Original Juice Co Pty Limited v Automotive Food Metals Engineering Printing & Kindred Industries Union [2001] FCA 675  referred to

Hayman Reese v Automotive Food Metals Engineering Printing & Kindred Industries Union (No 2) [2001] FCA 1328  referred to

KEPPEL PRINCE ENGINEERING PTY LTD v AUTOMOTIVE, FOODS, METALS, ENGINEERING, PRINTING AND KINDRED INDUSTRIES UNION & ANOR

V 1175 of 2001

GOLDBERG J

14 NOVEMBER 2001

MELBOURNE

THE COURT ORDERS THAT:

1.         The application for interlocutory injunctions be dismissed.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules

REASONS FOR JUDGMENT

HIS HONOUR: 

1                     The applicant has applied for urgent injunctive relief against the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union (“AMWU”) and the Australian Workers Union (“AWU”) (“the unions”), restraining them from engaging in certain conduct which it claims is in breach of an order made by the Australian Industrial Relations Commission (“the Commission”) under s 127(1) of the Workplace Relations Act 1996 (Cth) (“the Act”).  It also claims that that conduct is in breach of s 170MN of the Act.  The jurisdiction of the Court is invoked under ss 127(6) and 170NG of the Act and the Court’s accrued jurisdiction.  This latter jurisdiction gives rise to a consideration of s 166A of the Act. 

2                     The background to the application is as follows.  Portland Aluminium operates an aluminium smelter at Portland.  It engages the services of a number of contractors, including the applicant, which provide maintenance services at the smelter.  A number of the applicant’s employees are members of the unions.

3                     The applicant and the unions are parties to the Keppel Prince Engineering Pty Ltd Workshop Enterprise Employment Agreement 2000 and the Keppel Prince Engineering Pty Ltd Portland Smelter Site Enterprise Employment Agreement 2000, which are current and remain in force until 31 March 2003. 

4                     Another contractor which Portland Aluminium has retained in the past to provide maintenance services is Kempe Maintenance and Engineering Services (“Kempe”) which has employed 83 employees in Portland.  Over the past two years Portland Aluminium has engaged in a process of rationalisation which has resulted in Kempe losing its contract.  Portland Aluminium put out tenders for all the services that required contractors and as a result of acceptance of the applicant’s tender on 25 October 2001, the applicant will take up the majority of the work which was previously undertaken by Kempe.

5                     The provision of the mechanical services for which the applicant has tendered will require it to employ approximately 81 employees on site.

6                     In early October 2001 the unions commenced negotiations with all contractors of Portland Aluminium in an endeavour to negotiate employment for the employees of Kempe.  The AMWU has been represented during these negotiations by Mr Mark Solly, an organiser, and the AWU has been represented by Mr Ken Gadsden, an organiser.

7                     The applicant currently employs 43 employees on site and requires 81 to fulfil its contractual obligations.  It will need to employ an additional 38 people and has agreed to offer these positions to displaced Kempe employees and to the applicant’s employees.  The applicant has sought applications for these positions and has presently received approximately 35 applications.  The attitude of the unions is that all the employees who are employed by Kempe should be employed by the applicant.

8                     Industrial action commenced in late September 2001.  Overtime bans organised by the unions were placed on all sites and workshops of the applicant.  At that time the unions were seeking guarantees that no jobs would be lost as a result of the rationalisation process at the Portland smelter.  A dispute was notified to the Commission pursuant to s 99 of the Act and on 3 October 2001, Commissioner Foggo issued a determination and direction that all bans and limitations in place at the Portland Aluminium site be lifted.  The employees complied with the direction which remained in force until 9 October 2001.

9                     On or about 25 October 2001, Portland Aluminium decided to award the maintenance contract to the applicant.  On 1 November 2001, the respondent unions imposed overtime bans on the Portland Aluminium site and in the applicant’s workshop.  A dispute was notified to the Commission and on 5 November 2001, Commissioner Foggo issued a further determination and direction that all bans and limitations in place be lifted and that the determination remain in force until 14 November 2001.  That determination and direction was not followed.

10                  On 7 November 2001, there was a meeting between representatives of Portland Aluminium, the applicant, Kempe and the unions, to discuss the issues relating to employment.  Mr Gleeson, a representative of Portland Aluminium, said he would arrange a meeting with the unions and a member of senior management. 

11                  On 8 November 2001, a meeting of members of the unions was held to discuss the determination and direction of Commissioner Foggo which had been made on 5 November 2001.  In the course of that meeting Mr Solly telephoned Mr Gleeson and asked him whether the meeting with senior management had been arranged.  Mr Gleeson said that it had not, but that he would try to do so.

12                  At approximately 9.15 that morning, Mr Solly informed Portland Aluminium that the unions had commenced strike action.  The reason given was that the unions did not appreciate Mr Gleeson’s response to the inquiry as to whether a meeting had been arranged.  There was also a complaint about comments that the number of delegates who come to meetings should be restricted.

13                  A dispute was notified to the Commission and on 8 November 2001, Commissioner Foggo issued a determination and direction that all bans and limitations currently in place at the Portland Aluminium site and on any sites where employees of the applicant worked be lifted.  The determination remained in force until 14 November 2001.

14                  On 9 November 2001, the applicant made an application to the Commission pursuant to s 127 of the Act for an order against the unions and their members who are employed by the applicant, in substance, that the employees’ strike action cease and that the unions cease the incitement or encouragement of the employees’ strike action.  The application was made against the unions on the basis that they had been involved in organising the strike action.  On that day, Commissioner Foggo made an order pursuant to s 127 of the Act binding the unions, their officers, their delegates who are employed by the applicant, and the members of the unions who are employed by the applicant at its Portland premises and at the site of the Portland smelter.  The Commission ordered that the industrial action stop in the following terms:

“3.1     Industrial action as defined in clause 3.2 of this Order shall not occur at the premises of Keppel Prince Engineering Darts Road, Portland; Victoria Parade, Portland and at the Portland Aluminium site, Old Quarry Road, Portland from the time of the commencement of the Order.

3.2              For the purposes of this Order the expression ‘industrial action’ means:

3.2.1             In respect of the members of the AMWU and AWU it means the failure or refusal by a member to attend for work and/or to perform work as required by the Award/Certified Agreements and their contracts of employment;

3.2.2             In respect of the AMWU and AWU its officers and delegates, it means the incitement or encouragement of any of the members to fail or refuse to attend for work and/or to perform work as required by the Award/Certified Agreements and their contracts of employment.”

15                  The employees of the applicant who are members of the unions have remained on strike and have not returned to work.  On 12 November 2001, a meeting of members of the unions was held.  The meeting was chaired by Mr Gadsden, the AWU organiser.  After the meeting was held, Mr Gadsden told Mr Garner, the applicant’s General Manager, that the meeting had decided to continue the strike.  Mr Garner was unaware of the position the unions took at the meeting but he has said in an affidavit that he believes that the role of the unions to date has been such that strike action would not be taken by the applicant’s employees unless it was at the direction or encouragement of the unions’ representatives.  Mr Garner was unaware of any efforts by any delegate, organiser or official of the unions to take steps to ensure that the strike action which commenced on 8 November 2001 cease and not further occur.

16                  The unions have filed an affidavit by their solicitor which sets out information provided by Mr Solly and Mr Gadsden about what occurred at the meeting.  According to the information given to the solicitor by Mr Solly and Mr Gadsden, they addressed the meeting which was chaired by Mr Gadsden.  Mr Solly read out the order of Commissioner Foggo in full and advised the members at the meeting that the unions could not encourage or incite members of the unions to continue the strike.  Thereafter, several resolutions were moved and seconded by the union stewards that the members return to work, but those resolutions were not passed.  Neither Mr Solly nor Mr Gadsden spoke on the resolutions.

17                  A further meeting of members was held at 7.30am on 14 November 2001 in which Mr Solly and Mr Gadsden advised the members present of the orders made by Marshall J on the previous day, 13 November 2001.  Those orders, in substance, restrained the unions from engaging in any conduct which constituted a contravention of Commissioner Foggo’s order on 9 November 2001, and required the unions, as soon as reasonably possible, to use their best endeavours to inform their members employed by the applicant at Portland of the making of the orders.  The orders were expressed to apply until 4.30pm today.

18                  Mr Solly informed the unions’ solicitor that at the meeting on 14 November 2001 he read out the orders of Marshall J twice.  He was asked by a member what the 4.30pm time meant in the order, and he informed him that the order expired at 4.30pm.  Mr Gadsden told the solicitor that he recommended that the members return to work.  Mr Solly told the solicitor that some persons present sought to commence debating the matters and he informed them that he could not debate the matters with them, as doing so might be seen as encouraging them or inciting them to take industrial action. 

19                  As interlocutory injunctions are sought, I have to determine whether there is a serious question to be tried on the following issues: 

·                   the unions have engaged in conduct that constitutes a contravention of Commissioner Foggo’s order on 9 November 2001;

·                   the unions have engaged in industrial action in contravention of s 170MN(1) of the Act;

·                   the unions have been involved in the commission of a tort.  This last issue raises the question of whether s 166A(1) needed to be complied with in the circumstances.  This issue arises in relation to the jurisdiction which the applicant seeks to invoke in relation to the granting of interlocutory relief.

20                  The unions submitted that the order of Commissioner Foggo was too wide and uncertain to be enforced.  They relied upon evidence that in addition to members employed by the applicant, the unions had members employed directly by Portland Aluminium.  It was submitted that it was uncertain on the face of the order whether the members of the unions bound by the order were only the members employed by the applicant or were all members working at the relevant sites no matter whom their employer.  I do not accept this submission.  I am satisfied that the order is clear on its face.  Although the industrial action which is referred to is stated to be  “in respect of the members of the AMWU and AWU”, it is clear from par 2 of the order that the parties bound by the order are the members of those unions who are employed by the applicant at the applicant’s premises and the Portland Aluminium site. 

21                  The applicant submitted that the history of the industrial action to which I have referred showed that the unions had encouraged that industrial action and had been directly involved in the negotiations in relation to the displaced Kempe workers.  It was submitted that until the unions took positive steps to tell their members that they were not encouraging industrial action, I should take the view that their encouragement was continuing.  It was said that mere silence meant that the encouragement which the unions had given to the strike prior to the order of Commissioner Foggo on 9 November 2001 was continuing.  The argument was that on 9 November 2001 the unions had put in place an indefinite strike which was continuing.  The unions submitted they had complied with Commissioner Foggo’s order and that there was no serious question to be tried that subsequent to the making of that order the unions had directed, incited or encouraged the strike.

22                  On the material before me, there is no evidence that the unions have incited or encouraged their members in a manner resulting in a contravention of par 3.2.2 of Commissioner Foggo’s order (par 14 above).  The evidence, albeit on information and belief, is to the contrary.  In the absence of any evidence to the effect that subsequent to Commissioner Foggo’s order on 9 November 2001 the unions have incited or encouraged their members to strike, I do not consider that I should infer from the continuation of the strike that the unions have continued to encourage or incite it, having regard to the evidence from the solicitor for the unions to which I have referred.  In that respect, I refer again to the evidence that resolutions were moved by the union stewards that the workers return to work and that these resolutions were lost.  There was also the evidence that Mr Gadsden had informed the solicitor that he recommended that members return to work. 

23                  However, the applicant submitted that compliance with Commissioner Foggo’s order required not only a prospective refraining from conduct but a positive act to counter the effect or consequence of earlier encouragement or incitement prior to the order of 9 November 2001. 

24                  Notwithstanding that I am only obliged to find that there is a serious question to be tried on an issue, I am not satisfied that Commissioner Foggo’s order required any affirmative or positive conduct by the unions in relation to past conduct.  In its terms, the order is phrased in terms – industrial action “shall not occur” at the relevant premises.  The industrial action defined in the order is twofold:  firstly, it is directed to members of the unions, and secondly, it is directed to the unions.  It may be that the members are in breach of Commissioner Foggo’s order but the application before me is not directed to the members, rather it is directed to the unions.  I do not consider it appropriate to read into Commissioner Foggo’s order a positive obligation to do something in relation to the unions’ conduct prior to the order. 

25                  The applicant relied upon the decision in BHP Steel (AIS) Pty Ltd v Construction, Forestry, Mining and Energy Union (2000) 102 IR 275 in which in an application under s 127(6) the Court found that the union had breached an order made by the Commission under s 127 by failing to take any and all steps necessary, and available under its rules, to ensure that the employees complied with the order.  The order made was binding upon the union and the relevant employees of BHP Steel (AIS) Pty Ltd as well as the company itself.  The Commission ordered the employees to cease from engaging in industrial action in the form of any strike or restriction on work and that they make themselves available for work.

26                  The order made against the union was in the following terms:

“The CFMEU must take any and all steps necessary and available under the rules of the CFMEU to ensure that the employees referred to comply with the orders.”

In that case there was a positive obligation cast upon the union.  No such positive obligation is cast upon the unions by Commissioner Foggo’s order.  I am therefore not satisfied that there is a serious question to be tried that the unions have not complied with the order of Commissioner Foggo. 

27                  The unions submitted that there was no serious question to be tried that there was a breach by the unions of s 170MN(1) of the Act as the conduct alleged against the unions did not involve them “engaging in industrial action”, and in any event was not conduct to support or advance claims in respect of the negotiations for an agreement or an award.  However, for the reasons which I have set out in the cases of Original Juice Co Pty Limited v Automotive Food Metals Engineering Printing & Kindred Industries Union [2001] FCA 675 and Hayman Reese v Automotive Food Metals Engineering Printing & Kindred Industries Union (No 2) [2001] FCA 1328, I do not accept those submissions. 

28                  However, there is a difficulty in applying s 170MN(1) in the present circumstances.  Although there were earlier disputes about overtime bans, that industrial action has been subsumed in a subsequent strike.  On the material before me that strike has occurred through issues relating to the engagement or redeployment of the Kempe employees.  In other words, the industrial action has not been taken for the purpose of supporting or advancing claims against the applicant in respect of the employment of the employees whose employment is subject to the Keppel Prince Engineering Pty Ltd Workshop Enterprise Employment Agreement 2000 and the Keppel Prince Engineering Pty Ltd Portland Smelter Site Enterprise Employment Agreement 2000.

29                  There was also evidence before me that the employees of Kempe are employed pursuant to the Kempe Maintenance and Engineering Services Portland Aluminium Site Enterprise Agreement 2000.  In short, the industrial action has been taken in relation to the circumstances of, and conditions affecting, the Kempe employees who are not bound by the Keppel Prince industrial agreements.  I am therefore not satisfied that there is a serious question to be tried that the unions have engaged in industrial action in contravention of s 170MN.

30                  I turn to the allegation that interlocutory relief should be granted on the basis that the unions should be restrained from committing a tort.  Although the matter was not fully developed in argument, I took the tort alleged to be interfering with contractual relations or inducing breach of contract.  Any action in tort can only brought in a court if a certificate is given by the Commission in accordance with s 166A(6) of the Act.  In the present case no such certificate has been given.  The applicant submitted that the requirement for the obtaining of a certificate did not apply in the circumstances because the conduct of the unions relied upon fell within s 166A(2)(d) of the Act, namely:

“Conduct that is in breach of a direction by the Commission or a State industrial authority.”

31                  For the reasons to which I have already referred, I am not satisfied that the unions have committed any breach of Commissioner Foggo’s order of 9 November 2001 since that order was made. 

32                  The applicant submitted that where an application was made for injunctive relief it was not bringing an action in tort but was rather asking the Court to exercise its equitable jurisdiction to prevent the continuation or commission of a tort.  The applicant therefore submitted that it did not need a certificate under s 166A of the Act before seeking injunctive relief to restrain the continuation or commission of a tort. 

33                  In the present circumstances, I am not satisfied that there is a serious question to be tried that the unions are committing or threatening to commit a tort.  For the reasons to which I have already referred, I am not satisfied that since the making of Commissioner Foggo’s order on 9 November 2001 the unions have been encouraging or inciting the industrial action which is presently being undertaken by the members of the unions.  It is not to the point that the members themselves may be in breach of Commissioner Foggo’s order; it is the conduct of the unions which is presently being addressed. 

34                  Even if there had been conduct warranting the grant of an interlocutory injunction in relation to the continuation or commission of a tort, I do not consider that such an action is available without a certificate from the Commission under s 166A of the Act unless the conduct comes within subs (2).  Although there have been some decisions of other courts in which this issue has been raised, namely that an application for injunctive relief by way of exercise of equitable jurisdiction does not fall within s 166A of the Act, I do not consider that those cases set out a sufficient basis upon which I should conclude at the present time that there is a serious question to be tried on this issue.

35                  As I have reached the conclusion that there is not a serious question to be tried in relation to the causes of action alleged against the unions, it is not necessary to consider the question of the balance of convenience.  However, had it been necessary to do so I would have reached the conclusion that the balance of convenience was in favour of the grant of an injunction.  The evidence of the applicant was that it has a maintenance contract with Portland Aluminium to provide on and off-site maintenance and that the disruption caused by the strike was, and is, affecting that operation.  No evidence was led by the unions as to the balance of convenience.  It was apparent from the material before me that the maintenance work performed by the applicant is an essential and ongoing necessity for the effective operation of the smelter and that there was serious inconvenience caused to the applicant.

36                  My conclusion is that the application for interlocutory relief should be dismissed.

Associate:

Dated:              19 November 2001