6 March, 2018
When a mine owner adopts a contracting out model for the operation of its mine, it is, to an extent, limited in its ability to ensure a consistent supply of labour. One important step a mine owner can take is to ensure that a contractor has in place an in-term enterprise agreement for the duration of its mining contract. However, this is not always possible. In such circumstances any enterprise bargaining by the contractor can present a threat to the continued supply of labour to the mine given the risk of protected industrial action.
A recent decision of the Federal Court demonstrates that there are options which may be available to mine operators to protect their position and to try and ensure the continued operation of the mine.
A coal mine was, in November 2017, operated by a contractor mining company. The contractor’s contract expired on 30 November 2017, however the enterprise agreement covering the contractor’s workforce passed its nominal expiry date on 19 June 2017.
In August 2017 the CFMEU successfully sought a protected action ballot order (PABO) as part of its enterprise bargaining with the contractor. The contractor opposed the PABO. One reason for this was that the CFMEU’s reasons for the PABO included a desire to put pressure on a third party (the mine owner), in relation to the future employment of the contractor’s employees post the termination of the contractor’s contract. In granting the PABO, the FWC rejected the contractor’s contention that this was the CFMEU’s sole motivation, finding that the CFMEU was also genuinely trying to reach an agreement.
The CFMEU subsequently issued notices of an intention by the contractor’s employees to take protected industrial action in accordance with the Fair Work Act 2009 (Cth). The mine owner then filed an application for interlocutory relief in the Federal Court to stop the contractor’s employees from commencing industrial action.
The mine owner sought a declaration that the proposed industrial action was not protected action within the meaning of the FW Act and orders to prevent a secondary boycott in breach of the Competition and Consumer Act 2010 (Cth) (or damages in the alternative).
The mine owner contended that the proposed industrial action:
- was not "protected", because its sole (or at least dominant) purpose was to put pressure on a third party (the mine owner) and did not relate to a proposed enterprise agreement with the contractor; and
- would amount to an unlawful secondary boycott, in that its purpose was to hinder or prevent the international supply of coal and/or the mine owner engaging in trade or commerce involving the movement of coal outside Australia.
The Federal Court issued an interlocutory injunction as sought by the mine owner. This had the practical effect of preventing any industrial action prior to the expiry of the contractor’s contract at the mine. Subsequently, the CFMEU gave an undertaking that no industrial action would occur and on that basis the mine owner discontinued its application. A new agreement between the contractor and the CFMEU was entered into almost immediately.
The case highlights the importance of mine operators considering creative options to protect their interests. These options include the availability of competition law protections against secondary boycotts, including in circumstances where other challenges to industrial action may have failed.
For further information, please contact:
Ian Humphreys, Partner, Ashurst
ian.humphreys@ashurst.com
