Home » Electrolux: and the Full Bench says...

A Full Bench of the Australian Industrial Relations Commission has delivered a much anticipated decision on whether a range of contentious certified agreement clauses involve matters pertaining to the employment relationship.

Background

The Full Bench heard three appeals concurrently against decisions of single commissioners of the Australian Industrial Relations Commission (AIRC) dismissing applications to certify agreements.[1] In each decision, the commissioner refused to grant the application because one or more terms of the agreement did not pertain to the employment relationship. Since the High Court's decision in Electrolux,[2] it is clear that this makes certification impossible.

Approach

The Full Bench has provided guidance on several points that were not dealt with fully by the High Court. In summary, the Full Bench held that in dealing with the issue of which matters pertain to the employment relationship, the following guidelines should apply:

• for the AIRC to certify an agreement, each discrete, substantive and significant provision of the agreement must be about a matter that pertains to the relationship between the particular employer, in its capacity as employer, and its employees, in their capacity as employees;


• the matter must pertain to the employment relationship in a way that is direct and not merely consequential;


• provisions that do not pertain to the employment relationship may, nevertheless, be permissible if they are:
  • machinery provisions – indexes, tables of contents and the like;
  
  
  • incidental or ancillary to a matter that pertains to the employment relationship; or
  
  
  • provisions that do not pertain to the employment relationship, but are so trivial that they can be disregarded - aspirational provisions that do not impose an enforceable legal obligation on a party to the agreement might fall into this category;
• when examining a provision to see whether it pertains to the employment relationship, regard must be given to the words of the clause in the context of the agreement as a whole and to any relevant evidence; and


• the mere fact that a clause confers some rights on a union does not, of itself, lead to the conclusion that the clause does not pertain to the employment relationship.

In general terms, the Full Bench has adopted a broad view of which matters pertain to the employment relationship, consistent with the range of matters that have historically been accepted as capable of being the subject of an industrial dispute. This approach can be contrasted to the approach taken by the commissioner in Schefenacker.

Particular clauses

The Full Bench confirmed that payroll deduction of union dues clauses does not pertain to the employment relationship.

However, the Full Bench held that the following matters do pertain to the employment relationship:

• salary packaging;


• employer's use of labour hire agencies;


• trade union training leave;


• right of entry (for specific purposes); and


• recognition of union stewards / representatives.

What guidance?

Single commissioners of the AIRC are bound to follow the reasoning of the Full Bench. Except for divergences that are necessary due to the wording of particular clauses, the Full Bench's approach to the construction of specific clauses must also be followed and might be used as a sound guide to negotiating parties.

It is important to remember that the Full Bench's decision is not binding on the Federal Court, which may take a different approach to this issue. Consequently, there is still no clear guidance about the matters over which bargaining parties can take protected industrial action. However, the Federal Court's approach in the past has been to interpret the range of matters pertaining broadly and it is likely that there will be symmetry between the approaches of the two tribunals.

[1]Re Schefenacker Vision Systems Australia Pty Ltd, AWU, AMWU Certified Agreement 2004, PR952801, 28 October 2004(Schefenacker); Re La Trobe University Children's Centre Enterprise Bargaining Agreement 2004, PR953628, 24 November 2004; Re Rural City of Murray Bridge Nursing Employees, ANF (Aged Care) – Enterprise Agreement 2004, PR952449, 29 October 2004.
[2]Electrolux Home Products Pty Ltd v Australian Workers Union (2004) 209 ALR 116.