In J.J. Richards & Sons Pty Ltd and Australian Mines and
Metals Association Inc. v Fair Work Australian and Transport
Workers' Union of Australia FCAFC 53 (20 April 2012), the
Full Court of the Federal Court (Full Court)
dismissed the appeal against the decision of a Full Bench of Fair
Work Australia (FWA) that a union (on behalf of
employees) can be 'genuinely trying to reach agreement'
even where an employer refuses to bargain, without the need to
obtain a majority support determination.
This decision resolves a long running dispute that has been the
subject of two Full Bench decisions, and provides certainty on two
Firstly, that an employer's refusal to bargain will not stop
a union from obtaining a protected action ballot order under
section 443 of the Fair Work Act 2009 (FW Act);
and Secondly, there is no obligation for a union to secure a
majority support determination or scope order prior to making a
protected action ballot application.
In late 2010, the Transport Workers' Union of Australia
(TWU) wrote to JJ Richards (JJR),
seeking to enter negotiations for an enterprise agreement covering
employees on its Canterbury site. JJR declined to negotiate and the
TWU responded by making a protected action ballot application under
section 443 of the FW Act. The Full Bench upheld the appeal on a
technical point, however held that it was not necessary for JJR to
agree to bargain in order for an order to be made under section
On 1 February 2011, the TWU made a further protected action
ballot application. FWA granted the application on 16 February 2011
and JJR (with the Australian Mines and Metals Association
(AMMA) intervening) appealed the decision to the
Full Bench of FWA. On 11 June 2011, the Full Bench reaffirmed the
original Full Bench's position that bargaining was not
necessary for an order to be granted, and dismissed the
The Full Court's decision
Before the Full Court, the Applicants sought orders of
certiorari (that the previous orders be quashed) and mandamus (that
on the proper construction of section 443, the Full Court must not
make an order for a protected action ballot where bargaining has
The Applicants argued that where bargaining had not commenced, a
majority support determination or scope order must first be
obtained before a union could obtain a protected action ballot
order under section 443.
The Respondents (being the TWU and FWA) argued that the words
and effect of section 443 of the FW Act are clear and that the
words "genuinely trying to reach an agreement" did not
import a requirement that an employee and employer be engaged in
formal negotiations or bargaining, only that the Applicant is
genuinely trying to reach an agreement.
Jessup J of the Full Court agreed with the Full Bench of FWA
that the operation of section 443 was not conditional upon
bargaining having commenced. However, Jessup J disagreed with the
Full Bench's finding that there was "nothing in the
legislative provisions to suggest that a bargaining representative
should not be permitted to organise protected industrial action to
persuade an employer to agree to bargain."
Jessup J held that, to the contrary, the availability of
majority support determinations and scope orders under the FW Act
demonstrated that the legislature had contemplated mechanisms that
could be utilised to commence the bargaining process.
While Jessup J appeared to have some sympathy for the
Applicants' position, he ultimately concluded that section 443
could not be construed as the Applicants' proposed and held
that "the applicants' case really amounts to no more than
the proposition that the legislature ought, consistent with the
structure and policy of the [FW] Act as a whole, have conditioned
the power to make an order under s 443 upon the circumstance of
bargaining having commenced."
Justices Tracey and Flick provided separate judgements but
echoed Jessup J's decision in dismissing the application.
Lessons for employers
Given the Full Court's decision in JJR, and subject to any
future legislative change, employers who are preparing enterprise
bargaining strategies should be aware that protected industrial
action will continue to be accessible by employees and their
unions, even where the employer refuses to bargain.
We recommend that employers develop an industrial relations
strategy in preparation for the development of any new agreement
and/or for the expiry of a current agreement. The strategy should
include issues like dealing with unions and employee bargaining
representatives; developing an appropriate communication campaign;
and identifying key issues for bargaining.
Norton Rose has significant industrial relations and agreement
making expertise and can assist businesses across all employment
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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The FWC was satisfied that failure to accept the offer of settlement was an imprudent refusal of an offer of compromise.
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