FEDERAL COURT OF AUSTRALIA

Health Services Union of Australia Victoria No. 1 Branch v Specialist Diagnostic Services Pty Ltd trading as Dorevitch Pathology [2017] FCA 1200

ORDERS

THE COURT ORDERS THAT:

1.    The applicants’ application for interlocutory relief made in their originating application dated 3 October 2017 be dismissed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

(Revised from transcript)

O’CALLAGHAN J:

1    This is an urgent application for an interlocutory injunction brought by the Health Services Union and the Australian Nursing and Midwifery Federation (the applicants) against the respondent, Specialist Diagnostic Services Pty Ltd, trading as Dorevitch Pathology (Dorevitch).

2    Because it is highly desirable that I decide the matter immediately, my reasons are considerably briefer than they would be ordinarily. I have endeavoured in the time available to deal with all relevant oral and written submissions.

3    Dorevitch operates a medical laboratory and pathology services business providing pathology and medical diagnostic services to doctors, specialists in hospitals in Victoria, and to commercial and government organisations in Australia and abroad.

4    In 2003, the Australian Industrial Relations Commission certified the Mayne Health Dorevitch Enterprise Agreement 2004. It suffices to say for present purposes that since 2007 the applicants have sought to negotiate the terms of a new enterprise agreement. In 2016, Dorevitch agreed to commence bargaining.

5    In July and August of this year, the first applicant engaged in industrial action of various types and Dorevitch took employer response action, the particulars of which it is not necessary to recite for the purposes of resolving this application.

6    On 23 August 2017, the Minister for Industrial Relations for the State of Victoria made an application to the Fair Work Commission (the Commission) to terminate industrial action being engaged in by the applicants and Dorevitch, pursuant to s 424 of the Fair Work Act 2009 (Cth) (the Act).

7    On 4 September 2017, the Commission issued an order terminating all protected industrial action in relation to the proposed agreement and, for the purposes of s 266(3) of the Act, the post-industrial action bargaining period commenced. Again, for reasons which it is unnecessary to recite for present purposes, as things currently stand, the post-industrial negotiating period will end on 16 October 2017, in nine days’ time.

8    On 25 September 2017, Dorevitch informed the first applicant that it intended to ask certain of its employees to make an enterprise agreement under s 181 of the Act. On 29 September 2017, Dorevitch commenced sending to its relevant employees a bundle of documents, including a proposed enterprise agreement (the proposed agreement). Those documents were in evidence. The employees were told that they could vote on the proposed agreement between 7 October 2017 (two days from now) until 10 October 2017.

9    Relevantly for present purposes the proposal for the proposed agreement which accompanied a copy of the proposed agreement told relevant employees the following:

What happens if we don’t vote YES?

We will continue to negotiate in good faith at the Fair Work Commission. If we haven’t come to an agreement by 16 October 2017 then it will be listed for arbitration. This means that the Fair Work Commission will decide what the enterprise agreement will consist of – your terms and conditions of employment, and the offers we have included in this proposal would not be guaranteed, in particular the across-the-board increases and the classification changes.

(Emphasis in the original.)

10    Counsel appearing agreed that the reference to “across-the-board increases” was a reference to wage increases which have not yet been agreed. Counsel also agreed that the reference to “classification changes” was a reference to pathology collectors, an issue that has also not yet been agreed.

11    The affidavit material disclosed that during the course of the negotiations that have occurred the parties have agreed on many issues, but not on other issues, including items such as wage increases and leave entitlements.

12    The applicants seek an interlocutory injunction to restrain Dorevitch from asking its employees to agree to the making of the proposed agreement. Dorevitch opposes the granting of such an injunction.

13    The test for the granting of such an injunction is well-established and was not disputed. The applicants must first show that they have a prima facie case in the sense of a sufficient likelihood of success to justify in the circumstances the preservation of the status quo pending a final hearing. Secondly, the applicants must also show that the balance of convenience favours the granting of an injunction.

Prima facie case

14    The applicants contend that the Notice of employee representational rights (the Notice) provided by Dorevitch to each employee who would be covered by the agreement does not comply with s 174(1A) of the Act, and will, if the “yes” vote succeeds, not be approved by the Commission, because the Notice is not in the precise form prescribed by that section. Section 174(1A) provides that such a notice must contain the content prescribed by the regulations, not contain any other content and be in the form prescribed by the regulations. Counsel appearing for Dorevitch accepted for the purposes of this hearing that a prima facie case could be made that the Notice does not comply with that provision because it adds additional content to the prescribed form and does not identify the name of the agreement: see Peabody Moorvale Pty Ltd v Construction, Forestry, Mining and Energy Union [2014] FWCFB 2042; 242 IR 210 (Peabody); Shop, Distributive and Allied Employees Association v ALDI Foods Pty Ltd [2016] FCAFC 161 at [66]-[70] per Katzmann J.

15    The applicants contend that the Notice is therefore invalid and an enterprise agreement which proceeds based upon the Notice is incapable of approval by the Commission.

16    The claim for a prima facie case for an injunction on the basis that the Notice is defective rests upon the allegation that in proffering a defective notice, Dorevitch represented to the relevant employees that if they exercise their workplace right to make an agreement under s 181 of the Act, then the agreement so made is capable of having legal force and effect and the agreement is capable of being approved by the Commission – when, so the applicants contend, it is not.

17    The applicants contend that in doing so, there is a prima facie case made out that Dorevitch has contravened s 345 of the Act. It provides as follows:

Misrepresentations

(1)    A person must not knowingly or recklessly make a false or misleading representation about:

(a)    the workplace rights of another person; or

(b)    the exercise, or the effect of the exercise, of a workplace right by another person.

Note:    This subsection is a civil remedy provision (see Part 4-1).

(2)    Subsection (1) does not apply if the person to whom the representation is made would not be expected to rely on it.

18    Accordingly, in order to make good the proposition that they have a prima facie case on this ground, the applicants must establish a prima facie case that, in issuing what Dorevitch agrees for the purpose of this application is an arguably defective notice, it knowingly or recklessly made a false or misleading representation about a workplace right or the exercise of it. The applicants contend that the Court should at least infer that Dorevitch recklessly made a misleading representation along those lines because the solicitors acting on behalf of the first applicant wrote a letter to Dorevitch effectively warning it of deficiencies. That letter in relevant part, having drawn attention to s 174(1A) of the Act, stated that the final paragraph of the Notice:

… has the words “(via Human Resources)” added into the terms required by [the Act]. Your inclusion of the words set out above in the [Notice] infringes on the requirements of s 174(1A) of [the Act]. In this regard we refer to … [Peabody] … at [46]: “In our view s 174(1A) is clear and unambiguous. There is simply no capacity to depart from the form and content of the notice template provided in the Regulations. A failure to comply with these provisions goes to invalidity.” Consequently, the notice your client provided to its employees is invalid.

19    I cannot accept that a letter in those terms, without more, would permit a court to infer that, by acting contrary to the expression of opinion contained in the letter, the recipient engaged in the making of a recklessly misleading representation. That is especially so in circumstances where the only basis upon which it is asserted in the letter that the Notice is invalid is by the inclusion of the words “(via Human Resources)”. In my view, even having regard to the cases upon which counsel for the applicants relied, which stand for the proposition that a strict view is to be taken about literal compliance with the prescribed form, the inclusion of such words seems to me to be so innocuous that to infer from a rejection of the point of view expressed in the letter that the recipient of the letter recklessly misled their employees by not acceding to the point of view expressed in the letter is most improbable.

20    I should also note that the letter to which I have referred does not make reference to the other ground for invalidity relied on before me, namely that the name of the enterprise agreement was omitted from the Notice. To that extent, at least, the letter cannot be relied upon to draw any inference of the type sought to be made.

21    For those reasons, in my view, the applicants have failed to establish a prima facie case with respect to their first ground.

22    The second ground upon which the applicants rely is a contention for which they concede there is no authority. Put briefly, and I trust without doing disservice to counsel’s very able written submissions, the applicants say that, properly construed, once a termination of industrial action instrument has been made (which in this case happened when the Commission made a termination of industrial action instrument on 4 September 2017), the statutory processes under ss 181 and 186 of the Act are not available unless the bargaining representatives for the proposed agreement settle all matters in dispute in the bargain. The applicants contend that because, as is common ground, not all matters in dispute have yet been resolved, Dorevitch has no power to ask its relevant employees to make the proposed agreement under s 181 and the Commission has no power to approve it under s 186. In my view, counsel for Dorevitch is correct to submit that there is nothing in the scheme of the legislation or any particular provision which supports an argument that the making of a termination of industrial action instrument ousts the right of an employer and its employees to exercise their workplace right to make an enterprise agreement. In my view, that would be an unlikely notion for Parliament to have intended and, absent any sufficiently clear indication from the words of the statute, or authority of any kind to support it, I would reject the proposition that there is a prima facie case to be made in that regard.

23    The applicants also made a submission that the paragraph contained in the enterprise agreement proposal set out above at [9] was misleading or untrue because it suggested that when making a determination of the type referred to, the Commission might do other than approve an enterprise agreement that includes all matters agreed to when the bargaining period is finished. It accordingly submits that the Court should not permit a vote to occur. In my view, I cannot infer, as the applicants’ submission implied, that that paragraph on its own, is likely to mislead, especially in circumstances where it is common ground that the terms that appear in bold type (across-the-board increases and the classification changes) were matters or terms and conditions that had not been agreed and where I have not been referred to any other provision of the proposal document or any of the documents attached to the email that is in evidence.

Balance of convenience

24    The applicants contend that the balance of convenience favours them because, even if a majority of the employees vote “no”, the 10 October deadline for the closing of voting will influence the behaviour of the employees. As counsel for the applicants put it, “the die is cast”, because whether the proposal is voted down or not, the applicants will lose the opportunity to negotiate in a period of what counsel called “statutory pressure”. In the event that the employees, or a majority of them vote “yes”, and Dorevitch then goes to the Commission to seek approval for the agreement, that will, as counsel put it, detract from the urgency of negotiations. Further, it was submitted, if the proposed agreement is agreed to by members, there is then no capacity to negotiate a different agreement. That, it was submitted, is a lost opportunity that should weigh heavily in assessing the balance of convenience. Counsel also pointed to a disparity which exists under the legislation because Dorevitch has the right to recommence negotiations later on, but the applicants do not: see s 173 of the Act.

25    Counsel appearing for Dorevitch submitted, to the contrary, that considerations relating to the balance of convenience are overwhelmingly in favour of his client. I agree. First, Dorevitch is entitled to ask its employees whether they agree, or disagree, with the proposed agreement. The right to negotiate includes the right to make an agreement, and the right to make or enter into an enterprise agreement is an important workplace right, and in my view the applicants have shown no good reason to permit this Court to interfere with it. Secondly, the applicants do not point to any prejudice that their members will necessarily suffer if the proposed agreement is agreed to and then approved by the Commission. Which brings me to the third point. As counsel for Dorevitch submitted, most of the matters about which the applicants complain are matters that the Commission will no doubt consider if and when the agreement is agreed to by the members. Once, and if, that happens, Dorevitch must promptly submit the agreement to the Commission for approval. The applicants submitted that they will oppose that course of action and insist that the proposed agreement, if agreed to by members, will never see the light of day because it is invalid. If that is so, their prejudice can only be the lost opportunity relied upon – which, in my view, is of little, if any, significance. Finally, it is not disputed that the parties can continue to negotiate in the meantime. There was some evidence about how the negotiations that were occurring until recently broke down, but no purpose is served by suggesting that either party was or was not at fault. Counsel for Dorevitch, both in his oral and written submissions, stated that his client is willing to resume negotiations now and during the ballot process.

Joinder of second applicant

26    At the commencement of the hearing this morning, counsel appearing for the Health Services Union applied for an order that the Australian Nursing and Midwifery Federation have leave to file an application before me, with appropriate abridgement of the time for service, seeking to be joined as the second applicant to this proceeding. On the basis that the Australian Nursing and Midwifery Federation undertook not to make any submissions different to those made on behalf of the Health Services Union, counsel appearing for Dorevitch consented to the making of orders proffered by counsel, which I duly made.

Disposition

27    Accordingly, I will order that the applicants’ application for interlocutory relief made in their originating application dated 3 October 2017 be dismissed.

Associate:

Dated:    6 October 2017