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AUSTRALASIAN MEAT INDUSTRY EMPLOYEES' UNION v BELANDRA PTY LTD &ORS

V 416 OF 2002

NORTH J

29 AUGUST 2003 (CORRIGENDUM 5 NOVEMBER 2003)

MELBOURNE

1.On page 2 of the minutes of order, paragraph 4 of the declaration of theCourt, substitute "namely, that the person was entitledto the benefit of the2000 Agreement" for "namely, that the person was a member of the applicant".

Associate:

Dated:5 November 2003

INDUSTRIAL LAW - industrial relations - freedom of association -employer, closed down operation in July 2001 following fire with intention toreemployworkers when operation rebuilt - later decided not to reemploy -recommenced operations but contracted management company to manage-management company engaged labour-hire company to supply workers - labour-hirecompany offered workers employment under AustralianWorkplace Agreements -whether conduct of employer amounted to breach ofWorkplace Relations Act1996(Cth) ss 298K - 298L.

INDUSTRIAL LAW - meaning of "employer" - whether first respondent was anactual employer - whether there was an absolute termination of employmentinJuly 2001 - whether employees on WorkCover were not terminated - whethercontinued employment of WorkCover employees meant thatfirst respondent was anactual employer - whether first respondent was usually an employer - whethergeneral definition of employerinWorkplace Relations Act 1996(Cth)s4(1) applies toPart XA - proximity of employment.

INDUSTRIAL LAW - conduct of employer - refusal to employ - whether firstrespondent refused to employ the workers - whether the applicant mustdemonstratethat there was a vacancy for there to be a refusal to employ -where employer contrives to have no vacancies by the contraveningconductitself.

INDUSTRIAL LAW - conduct of employer - alteration to prejudice - whetherthe first respondent altered the position of the employees to their prejudicein breach of s298K(1)(c) when it decided not to reemploy - whether theemployees had an expectation - whether expectation includedreemployment onbasis of seniority - whether prejudicial alteration to position must occur toemployee's legal rights - whether prejudicialalteration to position can onlyoccur if an employment relationship exists at the time of the alteration -whether conduct of employermust be directed at an individual employee.

INDUSTRIAL LAW - prohibited reason for conduct - entitlement to thebenefit of an agreement - whether the employees were entitled to the benefitofan agreement when decision not to reemploy them and/or prejudicial alterationto their position made - whether entitlement maybe held by prospective of orprevious employee - whether refusal to employ was because of entitlement.

INDUSTRIAL LAW - prohibited reason for conduct - membership of anindustrial association - whether first respondent refused to employ and/oralteredemployees' position to their prejudice because they were members of anindustrial association - meaning of "membership" - whethers298L(1)(a) protectsemployees from victimisation merely for being a union member or also for theactivities of the union as an incidentof the employee being a member - whetherstatutory context suggests that scope of s298L(1)(a) is restricted toprotection for holdinga membership card - whether other subsections ofs298L(1) exclude broader interpretation of s298L(1)(a) -expressio unius estexclusio alterius- obligations under international law - law of otherjurisdictions.

WORDS AND PHRASES - "actual employer", "usually an employer", "refuse toemploy", "alteration of position to prejudice", "entitled", "member of anindustrial association".

Australian Constitution s 51

Acts Interpretation Act 1901(Cth)s 15AB

Commonwealth Conciliation and Arbitration Act 1904 (Cth) ss 4, 9

Conciliation and Arbitration Act1904-1952 (Cth) s 4

Conciliation and Arbitration Act 1973(Cth) s 5

Employment Protection Consolidation Act 1978(UK) ss 23, 58

Industrial Relations Act 1988(Cth)s 334

Industrial Relations Reform Act 1993(Cth) ss 170DA - G, 334A

Public Sector Management Act 1994 (WA)

South African Constitutions 23(5)

Workplace Relations Act 1996(Cth)ss 4(1), ss 89A, 188,189, 170CK,170CR, 170ML, 170MU, 170NF, 285A-G, 298A, 298B, 298K, 298L, 298U, 298V

Conciliation and Arbitration Bill 1910 (Cth)

Conciliation and Arbitration Bill 1952 (Cth)

European Convention for the Protection of Human Rights and FundamentalFreedoms,4 November 1950, Rome,213 UNTS 221

International Covenant on Civil and Political Rights, 19 December1966, New York,[1980] ATS 23

International Covenant on Economic, Social and Cultural Rights,19 December 1966, New York,[1976] ATS 5

International Labour Organisation Convention (No. 87) concerning Freedom ofAssociation and Protection of the Right to Organise,9 July 1948, SanFrancisco,[1974] ATS 3

International Labour Organisation Convention (No. 98) concerning theApplication of the Principles of the Right to Organise and toBargainCollectively,1 July 1949, Geneva,[1974] ATS 5

International Labour Organisation Convention (No. 158) concerningTermination of Employment at the Initiative of the Employer,22 June1982, Geneva,[1994] ATS 4

Universal Declaration of Human RightsG/A Res. 217A (III) UN. Doc.A/810, (10 December 1948),

American Ship Building v Labour Board[1965] USSC 53;380 US 300 (1965) cited

Ainsworth v Criminal Justice Commission[1992] HCA 10;(1991-1992) 175 CLR 564; (1992)106 ALRV11 cited

Associated British Ports v Palmer and OthersandAssociatedNewspapers Ltd v Wilson[1994] I.C.R. 97 cited

Associated Newspapers Ltd v Wilson and Associated British Ports v Palmer andOthers[1995] UKHL 2;[1995] 2 AC 454 considered

Australasian Meat Industry Employees' Union v R J Gilbertson (Queensland)Pty Ltd (unreported, Gray J, 8 December 1988) considered

Australian Workers' Union & Ors v BHP Iron-Ore Pty Ltd(2000) 96 IR422;[2000] FCA 39 cited

Australian Workers' Union & Ors v BHP Iron-Ore Pty Ltd(2000) 106FCR 482;[2001] FCA 3 not followed

BHP Iron Ore Pty Ltd v Australian Workers' Union & Ors(2000) 102FCR 97;[2000] FCA 430 considered

Burnie Port Corporation Pty Ltd v Maritime Union o f Australia104 FCR440;[2000] FCA 1768 followed

Burwood Cinema Ltd v Australian Theatrical and Amusement Employees'Association[1925] HCA 7;(1924-1925) 35 CLR 528 cited

Case of Wilson & the National Union of Journalists, Palmer, Wyeth &the National Union of Rail, Maritime & Transport Workers; Doolan &others v. the United Kingdom(unreported, Eur Ct HR, applicationnos 30668/96, 30671/96 and 30678/96, Strasbourg, 2 July 2002)considered

Community & Public Sector Union v Telstra Corporation Ltd(2001) 104IR 195;[2001] FCA 267 considered

Construction, Forestry, Mining & Energy Union v BHP Steel (AIS) PtyLtd[2000] FCA 1008 followed

Discount Tobacco & Confectionary Ltd v Armitage[1990] IRLR 15cited

Elliott v Kodak Australia Pty Ltd[2001] FCA 807 cited

Fraser v Fletcher Construction Australia Ltd(1996) 70 IR 117 notfollowed

Greater Dandenong City Council v Australian Municipal, Administrative,Clerical and Services Union(2001) 112 FCR 232;[2001] FCA 349considered

Houssein v Under Secretary of Industrial Relations and Technology(N.S.W.)[1982] HCA 2;(1982) 148 CLR 88 cited

Lewis Construction Co Pty Ltd v Martin & Ors(1986) 70 ALR 135;[1986] 17 IR 122 considered

Linehan v Northwest Exports Pty Ltd[1981] FCA 199;(1981) 57 FLR 49 considered

Maritime Union of Australia & Ors v Geraldton Port Authority & Ors(1999) 93 FCR 34;[1999] FCA 899 distinguished

Maritime Union of Australia v Burnie Port Corporation Pty Ltd[2000] FCA 1189;(2000) 101IR 435 followed

Maritime Union of Australia v CSL Australia Pty Ltd(2002) 113 IR 326;[2002] FCA 513 considered

Metal Trades Employers Association v Amalgamated Engineering Union[1935] HCA 79;(1935) 54 CLR 387 cited

Mills v Meeking & Anor[1990] HCA 6;(1990) 169 CLR 214 cited

Minister for Immigration and Ethnic Affairs v Teoh[1995] HCA 20;(1994-1995) 183 CLR273 cited

National Union of Workers v Qenos Pty Ltd(2001) 108 FCR 90;[2001] FCA 178 cited

Public Service Alliance of Canada v The Queen[1984] 2 FC 889 cited

Re Aluminium Industry Award 1983(1994) 56 IR 403 cited

Reference Re Public Service Employee Relations Act (Alta.)[1987] 1 SCR313 considered

Re Service Employees' International Union, Local 201 and Broadway ManorNursing Home(1983) 44 OR (2d) 392,409 cited

Re Stephen Phillip Gibbs And The Palmerston Town Council (unreported,Gray J, 21 December 1987) cited

The Jumbunna Coal Mine, No Liability and Another v The Victorian CoalMiners' Association(1908) 6 CLR 309 cited

The Queen v Findlay & Anor; Ex parte The Commonwealth Steamship Owners'Association and others[1953] HCA 81;(1953) 90 CLR 621 cited

The Queen v Kirby; Ex parte Boilermakers' Society of Australia[1956] HCA 10;(1955-1956) 94 CLR 254 cited

Wentworth v New South Wales Bar Association[1992] HCA 24;(1992) 176 CLR 239;(1992)106 ALR 624

DC Pearce & RS Geddes,Statutory Interpretation in Australia,5^th edn, Butterworths, Sydney 2001

P Ronfelt and R McCallum (eds),Enterprise Bargaining, Trade Unions and theLaw, Federation Press, Sydney, 1995

KD Ewing, `The implications of Wilson and Palmer',Industrial Law Journal,vol 32, No 1, March 2003, pp 6-7

A Frazer `Trade unions under compulsory arbitration and enterprisebargaining: a historical perspective' in P Ronfeldt and R McCallum(eds),Enterprise Bargaining, Trade Unions and the Law, Federation Press,Sydney, 1995

R C McCallum `Australian Workplace Agreements - an analysis',AustralianJournal of Labour Law, vol 10, 1997, pp 50-61

Report on Australian Industrial Law and Systems,Vol 2, 1985,Australian Government Publishing Service, Canberra

R Mitchell and J Fetter, `Human resource management and individualisation inAustralian labour law',The Journal of Industrial Relations, vol 45, no3, September 2003, pp 294-327

R Naughton, `Sailing into unchartered seas: The role of unions under theWorkplace Relations Act 1996 (Cth)'Australian Journal of Labour Law,vol 10, 1997, pp 112-132

M Pittard, `Collective employment relationships: reforms to arbitrated awardsand certified agreements',Australian Journal of Labour Law, Vol 10,1997 pp 62-88

Office of the Employment Advocate 2003, Sydney,viewed 28 August 2003,<http://www.oea.gov.au

AUSTRALASIAN MEAT INDUSTRY EMPLOYEES' UNION v BELANDRA PTY LTD &ORS

V416 OF 2002

NORTH J

29 AUGUST 2003

MELBOURNE

DEFINITION:

In this order:

(a)a reference to "the 2000 Agreement" is a reference to the Belandra Pty Ltdand the Australasian Meat Industry Employees' UnionVictorian Meat ProcessingAgreement 2000, which was certified by the Australian Industrial RelationsCommission on 20 July 2000;

(b)a reference to "the Belandra employees" is a reference to the persons whowere members of the applicant and who were employedby the first respondentimmediately prior to the fire, which occurred at 30 Industry Park Drive,Brooklyn, Victoria, on 20 June 2001,and whose terms and conditions ofemployment were governed by the 2000 Agreement.

THE COURT DECLARES THAT:

1.In September 2001, the first respondent contravened s 298K(1)(c) oftheWorkplace Relations Act 1996 (Cth) by altering the position of eachof the Belandra employees to the prejudice of that person by refusing to employthat personfor the reason, proscribed by s 298L(1)(a), namely, that theperson was a member of the applicant.

2.In September 2001, the first respondent contravened s 298K(1)(c) oftheWorkplace Relations Act 1996 (Cth) by altering the position of eachof the Belandra employees to the prejudice of that person by refusing to employthat personfor the reason, proscribed by s 298L(1)(h), namely, that theperson was entitled to the benefit of the 2000 Agreement.

3.In September 2001, the first respondent contravened s 298K(1)(d) oftheWorkplace Relations Act 1996 (Cth) by refusing to employ each of theBelandra employees for the reason proscribed by s 298L(1)(a), namely, thatthe person wasa member of the applicant.

4.In September 2001, the first respondent contravened s 298K(1)(d) oftheWorkplace Relations Act 1996 (Cth) by refusing to employ each of theBelandra employees for the reason, proscribed by s 298L(1)(h), namely,that the person wasa member of the applicant.

THE COURT ORDERS THAT:

1.The application is adjourned until 10.15 am on 26 September 2003 fordirections in relation to the further hearing concerningpenalty and otherrelief sought.

Note:Settlement and entry of orders is dealt with in Order 36 of the FederalCourt Rules.

THE PROCEEDING

1The applicant is an organisation registered under theWorkplace RelationsAct 1996(Cth) (the Act), whose members are employees in the meat industry.In this application, the applicant alleges that Belandra Pty Ltd(Belandra),the first respondent, which carried on the business of processing meat, refusedto employ certain employees and/or alteredthe position of those employees totheir prejudice, for the reason that the employees were members of theapplicant, and/or for thereason that the employees were entitled to thebenefit of an industrial agreement, contrary to ss 298K(1)(c) and (d), andss 298L(1)(a)and (h) of the Act.

2Pursuant to s 298U of the Act, the applicant seeks the imposition ofpenalties against Belandra for breaches of the Act, and alsoseeks restrainingorders and orders for compensation. It was agreed by the parties that theCourt would initially determine whetherBelandra had acted in breach of the Actas alleged, and, if that was found to be the case, the Court would then hearand determineissues relating to appropriate relief. As the case wasultimately argued at trial, the applicant did not allege any breach of theActby the other respondents. They were joined as parties to the proceeding sothat, if the Court found Belandra had breached theAct as alleged, theapplicant could seek orders against them where necessary to make effective anyorders made against Belandra. The first, fourth and fifth respondents wererepresented separately to the second and sixth respondents, and the thirdrespondent. However, as they all adopted each others' arguments, the argumentsraised by any of the respondents are attributed in these reasonsto allrespondents.

3These reasons for judgment determine only whether Belandra acted in breach ofs 298K(1)(c) and (d) of the Act as alleged. Thisquestion raises a numberof issues of law concerning the proper interpretation of s 298K ands 298L, and several contentious issuesof fact. The general factualsetting is largely uncontentious and the following description represents myfindings of fact in relationto those circumstances. The contentious legal andfactual issues will be dealt with in due course.

THE FACTS

4In 1996, Belandra commenced a beef slaughtering facility with associatedoperations at an abattoir at 30 Industry Park Drive,Brooklyn in the State ofVictoria (the Brooklyn site). The Brooklyn site was owned by a relatedcompany, Industry Park Pty Ltd (IndustryPark). As at 20 June 2001, Belandraemployed about 160 people in that operation. The major customer of the beefslaughtering operationwas Coles Supermarkets Australia Pty Ltd (ColesSupermarkets). The arrangement was that Coles Supermarkets supplied the stockandBelandra provided slaughtering services. Mr Sean Carroll, the sixthrespondent, was employed by Belandra as the works manager atthe Brooklyn site.It was accepted by the parties that all but two of the production employees ofBelandra who were eligible to bemembers of the applicant, were in fact membersof the applicant. The terms and conditions of employment of the productionemployeeswere governed by the Belandra Pty Ltd and the Australasian MeatIndustry Employees' Union Victorian Meat Processing Agreement 2000(the 2000Agreement), which was certified by the Australian Industrial RelationsCommission on 20 July 2000.

5Four other operations were conducted at the Brooklyn site. Three of thesewere conducted by companies controlled either by MrJoseph Catalfamo or MrGilbert Cabral and his family. The fourth, a boning operation, was operated byCollinsons, an unrelated company. Belandra Trading Pty Ltd (Belandra Trading)conducted a small stock slaughtering operation and employed about 200 peoplefor thatpurpose. EM Processors Pty Ltd (EM Processors) conducted a beefboning operation and employed about 110 employees for that purpose. The majorwork of this operation was the boning of the beef slaughtered by Belandra forColes Supermarkets. Finally, EM PackersPty Ltd (EM Packers) employed about 70people in connection with lamb cutting, and 60 people in connection with beefboning, in anotherboning room at the Brooklyn site.

6The affairs of Belandra are controlled by Mr Catalfamo, a director andmajority shareholder of the company. Belandra Tradingand Industry Park arewholly, or almost wholly, beneficially owned by Belandra, and thus, MrCatalfamo also controls those companies. Mr Cabral is the managing director ofBelandra, and also of Belandra Trading, EM Packers and EM Processors. Theother two directorsof Belandra are Mr Frank Oravec, also the general managerof Belandra, and Mr Lode. Mr Cabral was born in 1960 and has had abouttwentyyears experience in the meat industry. Mr Catalfamo was born in 1948. Hisexperience and relationship with the Cabral familywas described in evidence byhim as follows:

`I had extensive experience, having been involved in theindustry since the early 60s, where I started off as a butcher, apprentice. Ihad grown a network of people. I was - my credibility was second to none inthe industry. When I was excluded from the exportindustry[for ten years,as a result of findings made by the Woodward Royal Commission]I went on tostart rebuilding my retail chain of butcher shops which [I] had, rightthroughout the 70s. I could not participate inthe export industry, hence Ipassed on some of -Mr Cabral's father, Mr Gilbert Cabral's father, had beenworking for me as an accountantsince 1980. We had built a very strongrelationship. His son Gilbert came to work for me to run Richmond Ice in 1985or thereaboutsor 86. He did a fantastic job. He wanted to progress, he was ayoung man, so I channelled him, basically directed him into theexport streamand basically gave him advice, gave him contacts, guaranteed - some guaranteesfor him by way of - negotiated leasesfor him because of my experience to apoint where I knew that one day I would be cleared and I could participateagain in that business. That's basically the whole story.'

7Mr Catalfamo was, by reason of age, experience, and family relationship, akind of mentor for Mr Cabral. It was clear from theoral evidence which hegave at the trial, that he was the dominant voice in relation to the affairs ofBelandra. It was not in contentionthat Mr Catalfamo effectively made thedecisions relevant to this case, albeit after consultation with Mr Cabral, andalso with theother directors of Belandra.

8On 20 June 2001, a fire destroyed the Brooklyn site except for the boningroom operated by EM Processors. The employees of EMProcessors resumed workwithin a few days of the fire. The employees of Belandra, and of BelandraTrading and EM Packers, were dismissedbecause there was no work for them todo.

9However, Belandra intended, at that time, to restart the slaughteringoperation, and to reemploy the work force. Mr Catalfamotold this to officialsof the applicant at a meeting held at the Brooklyn site on 22 June 2001, twodays after the fire. This wasconfirmed by Mr Oravec, in the course of ahearing in the Australian Industrial Relations Commission on 12 July 2001, in adisputerelated to the boning operation of EM Processors:

`Now, there is no question that all these people of EMP, ExportMeat Packers, will be re-employed as soon as the company starts thatactivity.That has been promised and that will be done. The same as the people who willbe re-employed from Bilandra[sic]Proprietary Limited, Bilandra[sic]Trading Proprietary Limited. It is just a question, where do were-employ them because we have no facility; they are gone in thefire.'

10Belandra's intention to reemploy its production work-force is reflectedin its decision to withhold severance payments at the dateof dismissal. Sucha course was permitted under s 2.8 of the 2000 Agreement. The relevantparagraphs of the 2000 Agreement provided:

`2.8.1This clause shall apply where the employer decides toclose down permanently all or part of an operation or calls for voluntaryredundancies.

...

2.8.3In the event that employees are to be terminated as prescribed inclause 2.8.1 the following payments shall be made:

(a)two weeks payment in lieu of notice

(b)two weeks pay for each year of completed service

(c)pro rata payment for each completed month of an uncompleted year

provided that such payment shall not exceed twenty six (26) weeks of ordinarypay, and such payments shall be at ordinary ratesof pay as defined in clause6.3 (Long Service Leave).

2.8.4In the event that employees are terminated on the basis they will bere-employed and are subsequently not re-employed withineight (8) months, thisclause shall apply with an additional payment of 10% of the amount payableunder clause 2.8.3.' [emphasis added]

11Then, the event which is at the centre of this case occurred. Aroundmid-September 2001, Mr Catalfamo, in consultation withMr Cabral and Mr Oravec,decided that Belandra would not resume operations and would not reemploy theproduction employees who hadworked for Belandra immediately prior to the fire(the Belandra employees). In his affidavit sworn on 4 September 2002, MrCatalfamostated that his reasons for that decision involved a change inbusiness direction and strategy. He stated that he came to realisethat he andthe other directors of Belandra no longer had the production expertise tooversee a meat production operation and woulddo better to focus on other areassuch as marketing or research. Further, escalating costs meant that Belandrafaced insolvencyif it did not change its way of operation. The applicant'sopposing contention is that an operative reason for Mr Catalfamo's decisionwasthat the Belandra employees were members of the applicant and/or the employeeswere entitled to the benefit of the 2000 Agreement. Mr Catalfamo's reasons fordeciding not to reemploy the Belandra employees will be examined in some detaillater in these reasons.

12It followed from Belandra's decision to not reemploy the Belandra employeesthat Belandra was required to pay those employeestheir outstanding severanceentitlements, together with an additional payment of 10 per cent of thatamount, in order to comply withthe requirements of cl 2.8.4 of the 2000Agreement. This was done in March 2002.

13At about the time the final severance payments were made, several othersignificant events occurred.

14First, Mr Catalfamo and Mr Cabral, through various corporate vehicles,acquired another abattoir site located at Kyle Road, Altona(the Altona site).The Altona site was an asset of Tasman Group Services Pty Ltd (TGS) (then knownas SBA Foods Pty Ltd), the fourthrespondent. Tasman Group Holdings Pty Ltd(TGH) (then known as Tasman Group Services Pty Ltd), the fifth respondent,acquired allof the shares in TGS on 1 March 2002. Mr Catalfamo andMr Cabral each hold 50 per cent of the shares in TGH. They had beennegotiatingfor the acquisition of the assets and business of SBA sinceNovember 2000. The acquisition was delayed when the bank, as a resultof theuncertainty caused by the fire, refused to provide finance for the transaction.Following the fire at the Brooklyn site, Belandracontracted with otherabattoirs to slaughter cattle in order to continue to meet the ColesSupermarket contract. Although Altonahad not operated as an abattoir since1999, Mr Catalfamo and Mr Cabral decided that TGS would reopen the Altona sitein order toprovide slaughtering facilities for the Belandra stock.

15Second, Mr Catalfamo and Mr Cabral decided that TGS would not manage theslaughtering operation at the Altona site. Rather,it would engage amanagement company for that purpose. In late March 2002, Mr Cabral spoke to MrCarroll about undertaking the managementof the proposed slaughtering operationat the Altona site. It will be recalled that Mr Carroll had been the worksmanager for Belandraprior to the fire. A few days after the fire, on 24 June2001, his employment had been transferred to Industry Park, and, in thatcapacity, he had overseen the beef slaughtering carried out for Belandra byexternal contractors. Within six weeks, Mr Carroll andMr Cabral reached anoral agreement that Mr Carroll would acquire and operate a management companyto run the slaughtering operationfor Belandra at Altona. On 17 May 2002, MrCarroll acquired all the shares in Larberg Pty Ltd (Larberg), the secondrespondent,for this purpose. Under the agreement, Larberg would supplymanagement, supervisory and production staff, and would pay all necessaryregistration and licence fees. TGS was to provide the premises, including theslaughtering facilities, and meet the running costsof the operation, such aselectricity and water. TGS was to pay Larberg a fee per beast processed.

16Following the making of the oral agreement, Larberg proceeded to arrange forthe staffing of the operation. It engaged fourteenpermanent employees,including a production manager, a quality assurance manager, slaughter floorsupervisors, and load out supervisors. All fourteen had previously beenemployed by Belandra or Belandra Trading at the Brooklyn site. Larbergobtained quotes from twolabour hire companies for the provision of productionworkers. On 12 June 2002, Webb Labour Hire Pty Ltd (trading as ESP Tecforce)(ESP Tecforce), the third respondent, provided a quote to Larberg specifyingseparate hourly rates, inclusive of statutory charges,for the supply ofslaughtermen and labourers. Larberg accepted the quote. It was arranged thateach afternoon Larberg would notifyESP Tecforce of its labour requirements forthe following day. On 1 July 2002, slaughtering operations began at Altonaunder thesearrangements, and in the following months, ESP Tecforce suppliedabout 100 workers for the operation. Most of the workers suppliedby ESPTecforce had previously worked for Belandra at Brooklyn. Although not all theworkers supplied were engaged under AustralianWorkplace Agreements (AWA's),ESP Tecforce regarded AWA's as the most appropriate industrial instrument forthe operation. The ratesquoted by ESP Tecforce to Larberg could not bemaintained if ESP Tecforce had to engage the production workers on the terms ofthe2000 Agreement.

17Thus, from June 2001 to July 2002 some things changed and some thingsremained the same. At all times, Belandra retained thecontract to supply beefto Coles Supermarkets. At all times, the people who managed and supervised thebeef slaughtering operationwere essentially the same people. At all times,the people who worked on the slaughter floor were essentially the same people.Therefore,the supplier remained the same, the product remained the same, thepeople who managed the production remained the same, the peoplewho producedthe product remained the same, and the customer remained the same. Theprovider of the slaughter facilities remainedone or other company controlledby Mr Catalfamo, or by Mr Catalfamo and Mr Cabral. What changed over thatperiod was that the peoplewho worked on the slaughter floor were employed byanother employer. As a result they were no longer employed under the 2000Agreementand, as a further result, the applicant no longer had the role ofcollectively representing those employees. The applicant allegesthat, whilstBelandra retained the same essential operation, it arranged its affairs to ridthe workplace of the influence of theapplicant, and of the need to comply withthe 2000 Agreement. In so doing, the applicant alleges, Belandra engaged inconduct inbreach of s 298K(1)(c) and (d) for reasons proscribed ins 298L(1)(a) and (h).

THE RELEVANT STATUTORY PROVISIONS

18It is convenient now to set out the statutory provisions which bear upon thequestions raised in this case. The emphasised provisionsare those upon whichthe applicant relies to ground the liability of Belandra.

`298K(1)[Prohibited reasons for certain conduct by an employer] An employer must not, for a prohibited reason, or for reasons thatinclude aprohibited reason, do or threaten to do any of the following:

(a)dismiss an employee;

(b)injure an employee in his or her employment;

(c)alter the position of an employee to the employee'sprejudice;

(d)refuse to employ another person;

(e)discriminate against another person in the terms or conditions onwhich the employer offers to employ the other person.

298L(1)[Interpretation] Conduct referred to in subsection 298K(1) or (2) isfor a prohibited reason if it is carried out becausethe employee, independentcontractor or other person concerned:

(a)is, has been proposes to become or has at any time proposedto become an officer, delegate ormember of an industrial association;or

(b)is not, or does not propose to become, a member of an industrialassociation; or

(c)in the case of a refusal to engage another person as an independentcontractor:

(i)has one or more employees who are not, or do not propose to become,members of an industrial association; or

(ii)has not paid, or does not propose to pay, a fee (however described)to an industrial association; or

(d)has refused or failed to join in industrial action; or

(e)in the case of an employee - has refused or failed to agree orconsent to, or vote in favour of, the making of an agreement to whichanindustrial association of which the employee is a member would be a party;or

(f)has made, proposes to make or has at any time proposed to make anapplication to an industrial body for an order under an industriallaw for theholding of a secret ballot; or

(g)has participated in, proposed to participate in or has at any timeproposed to participate in a secret ballot ordered by an industrialbody underan industrial law; or

(h)is entitled to the benefit of an industrial instrumentor anorder of an industrial body; or

(i)has made or proposes to make any inquiry or complaint to a person orbody having the capacity under an industrial law to seek:

(i)compliance with that law; or

(ii)the observance of a person's rights under an industrial instrument; or

(j)has participated in, proposes to participate in or has at any timeproposed to participate in a proceeding under an industrial law;or

(k)has given or proposes to give evidence in a proceeding under anindustrial law; or

(l)in the case of an employee, or an independent contractor, who is amember of an industrial association that is seeking better industrialconditions - is dissatisfied with his or her conditions; or

(m)in the case of an employee or an independent contractor - hasabsented himself or herself from work without leave if:

(i)the absence was for the purpose of carrying out duties or exercisingrights as an officer of an industrial association; and

(ii)the employee or independent contractor applied for leave beforeabsenting himself or herself and leave was unreasonably refused orwithheld;or

(n)as an officer or member of an industrial association, has done, orproposes to do, an act or thing for the purpose of furthering orprotecting theindustrial interests of the industrial association, being an act or thing thatis:

(i)lawful; and

(ii)within the limits of an authority expressly conferred on theemployee, independent contractor or other person by the industrial associationunder its rules.'

[emphasis added]

The onus of proof is dealt with in s 298V as follows:

`298VIf:

(a)in an application under this Division relating to a person's or anindustrial association's conduct, it is alleged that the conductwas, or isbeing, carried out for a particular reason or with a particular intent; and

(b)for the person or industrial association to carry out the conductfor that reason or with that intent would constitute a contraventionof thisPart;

it is presumed, in proceedings under this Division arising from theapplication, that the conduct was, or is being, carried outfor that reason orwith that intent, unless the person or industrial association proves otherwise.'

WAS BELANDRA AN EMPLOYER?

19Only the conduct of an employer attracts the prohibition in s 298K(1)of the Act. The conduct about which the applicant complainsoccurred inSeptember 2001 when, so it is alleged, Belandra refused to employ the Belandraemployees, and/or altered their positionto their prejudice. The firstquestion, then, is whether Belandra was an employer at that time.

Was Belandra an actual employer - Was there an absolute termination ofemployment by Belandra?

20The applicant contends that, in September 2001, Belandra remained anemployer of the workers employed immediately before thefire because thetermination of employment, which occurred in June 2001, was not an absolutetermination. At the time, Belandraintended to reemploy the workforce, and itrelied on cl 2.8.4 of the 2000 Agreement to defer payment of the severancepayments. Those payments were not made until the expiration of the eight monthlimit stipulated in cl 2.8.4, which occurred in about earlyMarch. Theapplicant argues that, until the severance payments were made, there remained alegal connection between Belandra andthose workers which constituted Belandraan employer for the purposes of s 298K(1).

21I do not accept this argument because it runs counter to the terms of, andthe concept contained in, cl 2.8.4. The clause stipulatesthe amount ofthe severance payment, and then fixes the latest time for payment in thecircumstance that,"employees areterminated on the basis that theywill bere-employed and are subsequently not re-employed"[emphasisadded]. The clause addresses a situation in which the employment of theemployees has been terminated, that is to say,has been brought to an end. Thefact that the terminations are on the basis that the employees will bereemployed does not makethe terminations any less absolute. Rather, itpostulates that the employment relationships are brought to an end. Newemploymentrelations are created if the employees are reemployed within theeight month period.

22A further indication that the termination referred to in cl 2.8.4 is anabsolute termination of the employment relationship isthat the clause providesfor a severance payment to be made where there is no reemployment within eightmonths of the termination. The clause, thus, provides for a situation in whichthe initial termination of employment is final, because it is not followed byany further employment.

Was Belandra an actual employer - Workcover employees

23The applicant argued that Belandra remained an actual employer until afterFebruary 2002 because Belandra continued to employa number of employees whowere receiving WorkCover payments at the time of the fire. Their employmentwas not terminated immediatelyafter the fire.

24This argument involves both a factual and a legal issue. In relation to thefactual issue, Mr Cabral stated, in his affidavitsworn on 4 September 2002,that the WorkCover employees were not terminated in June 2001 when the rest ofthe Belandra employeeswere terminated. In cross-examination he sought toresile from that position. He said that the WorkCover employees wereterminated,but Belandra kept paying weekly payments after meeting withWorkCover officers. He said that although the employees were terminated,Belandra still "managed their files". He agreed that the WorkCover recipientswere not paid their severance entitlements until theirWorkCover paymentsended. In some cases that was after February 2002. Under cl 2.8.3 of the2000 Agreement severance payments arepayable on termination. I infer thatBelandra intended to comply with the terms of the 2000 Agreement. On the basisof this evidence,I find that, on the balance of probabilities, Belandracontinued to be the employer of a number of persons in receipt of WorkCoverpayments from the time of the fire until after February 2002.

25In relation to the legal issue, Mr Borenstein SC, who appeared with MrArmstrong for the applicant, sought to rely on the statusof Belandra as anemployer of the WorkCover employees as the basis of the allegation of acontravention of s 298K(1) by Belandrain relation to the non-WorkCoveremployees. The continued employment of the WorkCover employees, it wascontended, qualified Belandraas an actual employer for the purposes ofs 298K(1).

26In response, the respondents submitted that "the operation of s 298K(1)mustrelate to the position of employer as employervis-a-vis thepeople who are said to be the employees affected by the decision ... theposition of the WorkCover employees does not make Belandraan actual employerin respect of those former employees as at September 2001"

27The submission of the respondents might be correct if the case was broughtunder s 298K(1)(a) and it was alleged that an employerhad dismissed anemployee for a prohibited reason, or under s 298K(1)(b) and it was allegedthat an employer had injured an employeein his or her employment. But,insofar as the case is brought under s 298K(1)(d), the argument cannot besustained. This subsectionis concerned with the refusal by an employer toemployanother person. The other person cannot be an existing employee,and there is no requirement that the other person was previously an employeeofthe employer. Thus, where s 298K(1)(d) is relied upon, the applicant mustestablish that the respondent is an employer, but thecontravening conduct isnot necessarily conduct directed to an existing employee. It is conductdirected to persons who are refusedemployment. Consequently, the fact thatBelandra continued to employ the WorkCover employees made it an actual employerfor thepurposes for s 298K(1)(d), even though the contravention allegedwas not conduct directed against those employees.

Was Belandra usually an employer?

28Section 4(1) of the Act, relevantly, provides that;

"In this Act, unless the contrary intention appears:

`employer' includes:

(a)a person who is usually an employer;"

29The applicant argued that, even if Belandra was not an actual employerwhen the alleged contravening conduct occurred, then Belandrawas usually anemployer at that time within the meaning of s 4(1). The respondentsanswered with two contentions - first, that theextended definition did notapply to s 298K, and second, and alternatively, that Belandra was not, onthe facts, usually an employerat the time of the alleged contravening conduct.

30As to the first contention, Mr Parry SC, who appeared with Mr Mueller, forthe first, fourth and fifth respondents, relied onthe speech of theAttorney-General, made on the second reading of the Commonwealth Conciliationand Arbitration Bill in 1910 whichintroduced the extended definition ofemployee, as follows:

`Clause 2 amends the definition of "employé" to include"any person whose usual occupation is that of employé in anyindustry."That is to meet the case of unemployed persons in an industry, since it isconceivable that there may be a dispute inan industry where in fact there areno contractual relations existing at the time.'[Australia, House ofRepresentatives,Debates, vol 55, 1910, p 744]

31Mr Parry also relied on an exchange in Senate discussions in Committee,following the second reading of the Conciliation and ArbitrationBill 1952(Cth), which introduced the extended definition of "employer" as follows:

`Senator SHEEHAN (Victoria) [1.2 a.m.]:-Will the Minister informme of the reason for the alteration of the interpretation of theword"employer". The definition of employer in the principal act is -

"Employer" means any employer in any industry and includes a club.

The words proposed to be added to that definition after the word "includes"are -

Any person who is usually an employer in an industry and also includes

Will the Minister explain the significance of the addition of thosewords?

Senator O'SULLIVAN (Queensland- Minister for Trade and Customs) [1.3 a.m.].- It is proposed to add those words to the definitionof employer to bring itinto line with the definition of employee. The Registrar of the CommonwealthCourt of Conciliation and Arbitrationhas held that an association that makesapplication for registration as an association of employers under section 70Amay consistonly of persons who are actually employing labour at the time ofthe application. The amendment was suggested by employers.

Senator SHEEHAN - The addition of the proposed words will mean that a personwho is not in business at the time of the applicationmay be deemed to be anemployer?

Senator O'SULLIVAN. - That is so.'

[Australia, Senate,Debates, vol 217, 1952, p 1511]

32From these sources, Mr Parry argued that Parliament intended the extendeddefinition of employer to apply only to those provisionsof the Act which dealwith industrial disputes and the regulation of organisations. So viewed,Parliament has expressed a `contraryintention' for the purposes of s 4(1)of the Act.

33On the basis that the Committee proceedings may be taken into account (sees 15ABActs Interpretation Act 1901(Cth) but note the cautionarycomments of Dawson J inMills v Meeking and Anor[1990] HCA 6;(1990)169 CLR 214, at 236-7), this legislative history does not demonstratethat the definition of employer was to be limited in the way suggested.

34Whilst the Attorney-General explained to Parliament in 1910 that theextended definition of employee would impact on the provisionsconcerningindustrial disputes, he did not suggest that the application of the extendeddefinition was limited to those provisions. The definition was placed in thegeneral interpretation section of the Act. Indeed, in 1952 the Ministeraccepted that the extendeddefinition of employee applied to the provisions ofthe Act dealing with organisations. He said that the reason for extending thedefinition of employer was to ensure that it applied to those provisions and,thus, to `bring it into line with the definition of employee'. So, eventhough the Attorney-General in 1910 made no reference to the fact, the Ministerin 1952 had the view that the extendeddefinition of employee applied to otherprovisions of the Act such as those which regulated organisations.

35The more recent legislative history suggests that the extended definition ofemployee contained in s 4(1) was intended to applyto s 298K(1).Part XA of the Act, which contains s 298K(1), was inserted in 1996. Ins 298B certain definitions are provided forthe purposes of Part XA. Someterms defined in s 298B are also terms defined in s 4(1), however,they are given a different meaningwhere that is required for the purposes ofPart XA. For instance, the terms `industrial action' and `industrialdispute' are defineddifferently in s 298B, from s 4(1). The factthat the word `employer' has not been given a special meaning under s 298Bis an indicationthat the general definition is meant to apply to Part XA.Another indication is that s 298A, which sets out the objects of Part XA,specifically incorporates the general objects of the Act set out in s 3.Section 3 refers to employers and employees. These referencesapplygenerally for the purposes of the entire Act. The extended definitioncertainly applies to these references. Where Parliamentmeant words in Part XAto have a different meaning from the meaning of the words elsewhere in the Act,Parliament expressly providedfor different meanings. In the absence ofexpress reference to a different meaning for the purpose of Part XA it shouldbe concludedthat Parliament meant the words to have the same meaning aselsewhere in the Act.

36Finally, in principle, there is good reason for the extended definition toapply. Section 298K(1) is found in Part XA whichis concerned with`freedom of association'. The objects of the Part are set out in s 298Aand include:

`As well as the objects set out in section 3, this Part hasthese objects:

(a)to ensure that employers, employees and independent contractors arefree to join industrial associations of their choice or not tojoin industrialassociations; and

(b)to ensure that employers, employees and independent contractors arenot discriminated against or victimised because they are, or arenot, membersor officers of industrial associations.'

37The provisions, thus, seek to ensure that certain basic freedoms areavailable to all participants in the workplace. The objectsof the part areadvanced if the scope of the part is interpreted as reaching beyond persons whoare presently employers to personswho are usually employers.

38The operation of the extended definition in the context of s 298K(1),or its predecessor provisions, has been considered in severalcases.Linehan v Northwest Exports Pty Ltd[1981] FCA 199;(1981) 57 FLR 49 (Linehan)involved employment in the meat industry. In order to allow for seasonalshutdowns and also for the variable supply of stock duringthe season,employment in the meat industry exhibited some special characteristics. Acategory of employment called regular dailyhire developed. Such employmentlasted for a day at a time. At the end of each day of employment, theemployment relationship terminatedbut the engagement as a regular daily hireworker continued until terminated by notice. Whilst the engagement lasted,employeeswere obliged to attend each day unless notified that they were notrequired to attend. A typical example of a clause in an awardproviding forregular daily hire can be seen inLinehanat 58. InLinehan, theemployer, some time after it had terminated the employment of a regular dailyhire employee, terminated the engagement of theemployee for a prohibitedreason. The question arose whether the employer had altered the position ofthe employee to the prejudiceof the employee contrary to the equivalent ofs 298K(1)(c) (which, at that time, made contravention a criminal offence).As the employmenthad been terminated before the engagement was terminated, andhence the former employee was no longer an existing employee, contraventionofthe section could only be established upon application of the extendeddefinition of employee. Ellicott J held inLinehan that there hadbeen a contravention in those circumstances, but there was no discussion aboutthe extended definition. The casedemonstrates one instance in which conductcontrary to the freedom of association objects of the Act would have beenwithout remedyif the extended definition had not been available.

39Then, in obiter dicta inRe: Australian Meat Industry Employees' UnionAnd: R J Gilbertson (Queensland) Pty Ltd(unreported, Gray J,8 December 1988) Gray J addressed the issue, at par 25, asfollows:

`With respect to the third group of charges, there was argumentabout the meaning of the phrase "alter his position to his prejudice"in s.5(1)of the Act. Counsel for the defendant referred to judgments in which exampleswere given of acts which might constitutealteration of an employee's positionto his or her prejudice. ... Each refers to an act done to a person within theconfines of asubsisting employment relationship, and by the other party tothat relationship. Despite these examples, I am not persuaded thatthe phrase"alter his position to his prejudice" is limited to such situations. Havingregard to the extended definitions of "employee"and "employer" in s.4(1) ofthe Act, and to the apparently deliberate choice of a phrase which does notcontain a reference to "employment"(as does the phrase "injure him in hisemployment"),I am of the view that it would be possible for a personusually an employer in an industry to commit an offence by altering thepositionof a person usually an employee in the same industry to the prejudiceof the latter person, by reason of one or more of the proscribedcircumstancesfound in s.5(1) of the Act. I note that, inLinehan v. NorthwestExports Pty. Ltd.[1981] FCA 199;(1981) 57 FLR 49, at pp 61-62, Ellicott J. found thatdepriving a person of the status of regular daily employee, under an awardprovision similarto that found in s.4 of the Award, involved an alteration ofthat person's position to his prejudice. As I have already pointedout,Ellicott J. found that the person concerned had not been dismissed, because hisemployment had terminated at the end of theworking day concerned.Deprivation of the status of regular daily employee may be an example ofaltering the position of a person with whom there is no longerany employmentrelationship subsisting. Another example might be in circumstances wherean employer first dismisses an employee, e.g. by reason of membership of anorganization,and afterwards places that person's name on a blacklist, therebyrendering it more difficult for him or her to gain employment elsewherein thesame industry. If the person's usual occupation is that of an employee in theindustry concerned, it is easy to see thathis or her position has been alteredto his or her prejudice. This does not mean that any employer in thatindustry, refusing toengage that person, would commit an offence, even if therefusal resulted from a proscribed circumstance. A refusal to employ wouldnotin itself alter the position of the person whose usual occupation was that ofan employee in a particular industry. Such a personwould remain in theposition of being unemployed. The employer causing the name to be blacklisted,however, would commit an offence; the act of that employer would change theposition of the other person, by making it more difficult for him or her togain employment.'[emphasis added]

40The operation of the extended definition can be seen in another contextinThe Queen v Findlay & Anor; Ex parte The Commonwealth SteamshipOwners' Association and others[1953] HCA 81;(1953) 90 CLR 621 (Findlay). In thiscase the extended definition was applied to ensure that the freedom ofassociation objects of the Act were achieved. The issue was whether a claim bywharf clerks for attendance money could found the jurisdiction of aconciliation commissioner. That, in turn, depended on whether the claim was an`industrial matter'. Such a matter was defined in s 4 of theConciliation and Arbitration Act1904-1952 (Cth) as one `pertainingto the relations of employers and employee' and included, `(f) thequestion whether monetary allowances shall be made by an employer in respect ofany time when the employee is not actuallyworking'. The attendance moneyclaimed was to be payable when a wharf clerk attended at the place ofengagement, but was not given employment. The ship owners argued that theclaim could not pertain to the relations of employers and employees because itwas a claim in respectof a period of no employment, and was payable because ofthe absence of any relationship of employer and employee. Dixon CJ, withwhomthe other members of the court agreed, said at 631:

`The specific reference in par. (f) of the definition of"industrial matter" to monetary allowances in respect of time when an employeeis not actually working cannotbe ignored. No doubt this paragraph wasincluded in order to cover the case of "permanent" employees remuneratedaccording to timeactually worked. But it recognizes that payment for idletime lost is an industrial matter and there is no limit of place orcircumstancein the words used.Once again the extended definitions of"employer" and "employee" must be applied, and that means that an existingrelation of masterand servant at the time the employee was not actuallyworking cannot be essential to par. (f).'[emphasis added]

41Based on the history of the section, the structure of the Act as a whole,and the referred to authorities, the extended definitionof employer does applyto s 298K.

42The issue, then, is whether the facts of the present case demonstrate thatBelandra was `usually an employer'? Mr Parry arguedthat in order to qualifyas `usually an employer' there must be some proximity of employment. Theperson must have either been anactual employer just prior to the time inquestion, or must have employment of workers in prospect. He contended thatBelandra hadnot been an actual employer since the fire in June 2001, andtherefore, at the time of the alleged breach in September 2001, it hadnot beenan actual employer for about two and a half months. Further, Belandra did notintend to be an employer in the future. It had no managers or supervisors, andit did not have any premises. In that sense, he submitted, Belandra had nooperation in whichit could employ people.

43Whether a person is usually an employer is a question of fact to bedetermined in the light of all the circumstances in eachcase. There is noformula appropriate in all cases which can be used to answer the question. Asto a past employment relationship,it may be relevant to know how long ago theperson ceased to be an actual employer or to understand why the person ceasedto be anactual employer. As to future employment, it may be relevant to knowwhen such employment is to commence or resume, and the circumstancesof anydelay in commencing or resuming employment.

44The unusual circumstances of the present case demonstrate how difficult itwould be to reduce the enquiry to some generally applicableformula. In thepresent case, the inability of Belandra to conduct operations and to employpeople resulted from the occurrenceof the fire. The cessation of employmentwas forced upon Belandra because the fire destroyed the premises in which thework wasdone. If it had not been for the fire, Belandra would have continuedto employ its workforce to operate the slaughter floor at Brooklyn.Significantly, however, immediately after the fire Belandra intended toreemploy the workforce. That was the reason Belandra delayedpayment of theseverance entitlements, as it was entitled to do. The evidence of Mr Catalfamowas clear. He intended to reemploythe workforce and to that end he tookenergetic steps to make this possible. For instance, he described his effortsto secure thedisused abattoir site at Kyle Road, Altona, as a temporaryworkplace as follows:

`in the days after that[the fire] we tried everythingwith the Japanese[the previous owner]to get hold of Altona. TheCommonwealth Bank did what they had to do, but we went directly to KPMG whowere agents for the Japaneseseeking a very urgent meeting and putting our caseforward to the Japanese to lease Altona to us for a period of time until wecouldre-organise and regroup but they wouldn't hear of it. It was eithersettlement or nothing.'

45Mr Catalfamo also described intense efforts taken in the weeks followingthe fire to restore the Brooklyn site and to negotiatewith insurers toreinstate the premises. These steps were taken as part of a plan to restartproduction with the previous workforce. During this period there is noquestion that Belandra was usually an employer. On the approach suggested byMr Parry, Belandrahad recently been an employer and, so far as Belandra'splans were concerned, reemployment was in prospect.

46Then the situation changed. From September 2001, no longer was reemploymentin prospect. The reason was that Belandra had alteredits plans and decidednot to reemploy the workforce. If Belandra then ceased to be an employer, thatresult came about as a consequenceof its decision not to reemploy theworkforce. That decision is the conduct which forms the basis of theapplicant's complaint ofcontravention of s 298K(1).

47The argument pressed by the respondents seeks to characterise Belandra'sstatus as no longer usually an employer by referenceto the circumstancesprevailing after the alleged contravening conduct occurred. It seeks to relyon the situation brought aboutas a result of the alleged contravening conduct.However, the relevant time for the determination of Belandra's employer statusisimmediately before the alleged contravening act takes place. Immediatelybefore the decision not to reemploy the workforce was made,Belandra wasusually an employer by reference to its intention to reemploy the workforce inthe future. Therefore, immediately priorto Belandra deciding not to reemployits workforce, it was usually an employer within the meaning of s 4(1) ofthe Act.

DID BELANDRA REFUSE TO EMPLOY THE BELANDRA EMPLOYEES?

48The respondents then argued that, even if Belandra was an employer under theAct, Belandra did not refuse to employ the Belandraemployees within themeaning of s 298K(1)(d). They submitted that there can be no such refusalunless a vacancy exists in the workforcewhich can be filled by the engagementof the person in question. For this proposition, the respondents relied onthree cases, namely,Fraser v Fletcher Construction Australia Ltd(1996)70 IR 117 (Fletcher);Maritime Union of Australia v Burnie PortCorporation Pty Ltd[2000] FCA 1189;(2000) 101 IR 435 (Burnie); andConstruction,Forestry, Mining and Energy Union v BHP Steel (AIS) Pty Ltd[2000] FCA 1008(CFMEU v BHP Steel). They contended that there was no vacancy availableto be filled in September 2001 because Belandra had decided not to employanyonethereafter. Belandra had not refused to employ the former workforce.There were just no vacancies for Belandra to fill.

49There are at least two available constructions of the expression "refuse toemploy" as used in s 298K(1)(d) in relation to vacancies. On oneapproach, it can be said that there is no refusal to do something if thatresult cannot be achieved. A person cannot refuseto do that which cannot bedone. If there is no vacancy, then there can be no refusal to employ. Therespondents argued for thisapproach (the former construction). Alternatively,it can be said that even if an outcome is not available, the decision not toprovide it is nonetheless a refusal to provide the outcome. That is, whetherthe outcome can be achieved should be considered separatelyfrom whether therewas a decision not to achieve the outcome. Thus, there can still be a refusalto employ even if there is foundto be no available vacancy (the latterconstruction).

50The statutory context in which s 298K(1)(d) appears suggests that thelatter construction was intended. Division 3 of Part XAof the Actprohibits certain conduct undertaken for specified reasons. The conduct andthe reasons are dealt with separately. Theconduct is defined in s 298Kand the prohibited reasons are specified in s 298L. The dichotomy iscarried through into s 298V, whichprovides that where conduct is allegedto have been undertaken for a prohibited reason, the respondent bears the onusof showingthat the conduct was not undertaken for that reason. In advancingthe objects of freedom of association, Parliament has taken aview about theproper balance between the parties in relation to the discharge of theobligation of proof. Conduct is treated differentlyfrom the reasons for it.A reverse onus on the issue of the reason for conduct makes good sense becausethe reason for conduct isa matter peculiarly within the knowledge of therespondent.

51The same approach underlies the latter construction of the expression"refusal to employ". The applicant is required to provethe conduct, namely,that the applicant was refused employment by the respondent. The onus thenshifts to the respondent to disprovethe prohibited reason alleged. At thispoint, the absence of a vacancy may provide an innocent explanation for theconduct. Dependingon the circumstances giving rise to the absence of avacancy, the lack of an available position may show that the reason for therefusal was not a prohibited reason.

52Further, the difficulty with the former construction is that it allows anemployer to circumvent the operation of s 298K(1)(d)by its own action.If an employer only refuses to employ where a vacancy exists, then, in order toavoid engaging a particular personfor a prohibited reason, the employer cansimply contrive to have no vacancy. Consider the situation where an employerhas two vacancies. He has three applicants, A, B, and C. A and B are notunion members and C is a union member. The employer engages A and B andrejects C. The reason for rejecting C is that he is a union member. Were itnot for this fact, the employer would have preferredC to A and B. If Cchallenged this decision under s 298K(1)(d) it would be open to theemployer to argue, if the former constructionof the subsection applied, thatthere was no refusal to employ C because there was no longer a vacancy.However, it was the contraveningact itself which caused there to be novacancy. One would imagine that such a situation was precisely what thesubsection was intendedto guard against. The former construction thus allowsan employer to escape liability by arranging for there to be no vacanciesavailable to an applicant whom the employer wishes to reject for a prohibitedreason.

53InBurnie, Ryan J dealt with a case similar to the example justdiscussed. The Burnie Port Corporation had two vacancies for portoperatives/coldstore operators. The Burnie Port Corporation decided that theemployment of the person appointed to fill each of the vacancies wouldbegoverned by an AWA. Six applicants applied for the jobs. One applicant,Mr Rolls, said at the interview that he was not happyfor his employmentto be governed by an AWA. He was not selected. Ryan J found that the reasonthat Burnie Port Corporation didnot select Mr Rolls was that he was entitledto the benefit of an industrial instrument (s 298L(1)(h)), namely, anEnterprise BargainingAgreement which would have otherwise applied to hisemployment. Ryan J considered whether there was a refusal to employ Mr Rollswithin the meaning of s 298K(1)(d). He said at par 41:

`The Union contends that Mr Rolls, because of his expressedobjection to entering into an AWA, was in a class of persons who wouldnever beemployed by the applicant, and that this constituted a refusal to employ unders 298K(1)(d). However, as I put to Counselduring the hearing,thatsubmission is more accurately directed towards the reason for any refusal toemploy that may have occurred.'[emphasis added]

54His Honour then rejected the Burnie Port Corporation's argument which soughtto characterise its decision as a decision to prefertwo other candidates overMr Rolls, rather than a decision to refuse to employ. His Honour continued atpar 44:

`In the present case there were two vacancies for which Mr Rollshad applied and was under active consideration. The refusal to employhimoccurred when the Corporation decided to employ two other applicants inpreference to Mr Rolls.To hold otherwise would make it impossible topredicate of Mr Rolls, or any other person passed over for selection, a"refusal toemploy", or an "agreement to employ". Whether the refusaloccurred because there was a class of persons whom the Corporation would neveremploy (because they refusedto enter into an AWA) or because two othercandidates were preferred on merit, is relevant to the reasons for thatrefusal.'[emphasis added]

55Ryan J thus held that an employer refuses to employ where it has aposition under active consideration at the time of rejectingthe applicant. Hefound this to be the fact inBurnie. His reasoning, expressed in theemphasised passage set out in par 53 above, is also a basis for regardingthe question of the existenceof a vacancy as part of the consideration of thereason for the refusal to employ. His Honour also adverted to this approach inthe emphasised passage set out in par 54 above. There, his Honourconsidered whether Mr Rolls was in a class of persons who wouldnever beemployed by the Burnie Port Corporation. Put another way, the question waswhether Mr Rolls was a person for whom therewould never be a vacancy. Thismatter, his Honour said, was more accurately directed towards the reason forthe refusal. Althoughan appeal from his Honour's decision was allowed(Burnie Port Corporation Pty Ltd v Maritime Union of Australia104 FCR 440;[2000] FCA 1768) the Full Court said, as to thequestion presently under consideration, at par 14:

`The Corporation relied on three main grounds. The first wasthat it had not refused to employ Mr Rolls. Rather, so it said, MrRollsdeclined to accept the terms and conditions of employment offered to him. Theprimary judge found that the Corporation hadrefused to employ Mr Rolls when itdecided to employ the two other applicants in preference to him. That findingwas open on theevidence. We are not persuaded that his Honour erred in anyrespect in arriving at it.'

56The source of the respondents' submission in the present case that theformer construction should apply was the decision of MooreJ inFletcher. In that case, two charges were brought unders 334(2) oftheIndustrial Relations Act 1988 (Cth), the predecessor to s 298L,which made it an offence to refuse to employ a person for specified reasons,including the reasonthat the person had been a union delegate or member, orhad given evidence in a proceeding under the Act. The provision was in similarterms to s 298K(1)(d) read with s 298L(1). However, a difference isthat, whilst the present provisions provide for a civil sanction,the previousprovisions provided for a criminal sanction. Two employees of FletcherConstructions Australia Limited (Fletcher Constructions),Gallagher and Arnold,were employed on a gas pipeline project. They were elected delegates of theConstruction, Forestry, Mining,and Energy Union (CFMEU). They took action andgave evidence in the Australian Industrial Relations Commission in support of aclaimfor a completion bonus on the gas pipeline project. The employment ofGallagher and Arnold came to an end when the project on whichthey wereemployed was completed late in 1995. In 1996, Fletcher Constructions was tocommence a new gas pipeline project, and itcompleted hiring for that projectby February 1996. Some, but not all, of the employees from the previousproject were employedon the new project. Gallagher and Arnold applied forjobs on the new project in April 1996 but were not employed. The informationalleged that, on 30 April 1996, Fletcher Constructions refused to employGallagher and Arnold for proscribed reasons. His Honoursaid, at 118:

`It is conceded by the prosecutors that there is no evidence ofpositions being available in late April 1996 in the workforce involvedin thenew project.'

57In these circumstances, the defendant put, and his Honour upheld, asubmission that the defendant had no case to answer.

58His Honour said at 119 that the expression "refuse to employ" dealswith:

`actual employment where there is a refusal to employ aperson in circumstances where, apart from the refusal, employment might orwould arise. I refer to situations where employment might arise to allowfor circumstances where a vacant position exists and a refusal to employarisesbefore the employer has ascertained whether the person applying for the job orposition, who is victimised for a prescribedreason, is qualified or equippedto do the job.'[emphasis added]

59His Honour concluded at 121:

`On one view, the opposite of "refuse to employ" is "agree toemploy". "To employ" may mean, in context, to enter a contract of employment.It is entirely consistent with the ordinary meaning of "refuse", and for thatmatter "agree",to treat "refuse to employ" as describing a situation wherethe employer does not do what otherwise would be done, namely, agree toemploy by entering a contract of employment.

Having regard to the context in which the expression "refuse to employ"appears in s 334(2),I have concluded it relates to a refusal by anemployer to employ a person for a proscribed reason when employment would ormightotherwise occur. That is, it concerns the refusal of an employer toemploy a person by refusing to enter a contract of employment. That arises,inmy opinion, only if a position or vacancy exists to which the employment wouldhave related at the time of refusal. Accordingly,in the absence of evidencethat a position or vacancy existed in late April 1996, the prosector has failedto establish, even ona prima facie basis, a refusal to employ. In my opinionthe defendant does not have a case to answer.'[emphasisadded]

60It must be recalled that his Honour was dealing with a case in which itwas conceded that there were no vacant positions availableto be filled at thetime of the alleged offence. In those circumstances, his Honour held thatthere was no refusal to employ becauseemployment could not have occurred, evenin the absence of the conduct complained about. The primary constructionadopted by hisHonour was that a refusal to employ only occurs when employmentwould or might otherwise occur. His Honour applied that constructionto thefacts of the case before him. Those facts were that there was no vacancy. Itfollowed, on those facts, that employment wouldnot otherwise have occurred.But the decision does not mean that where an employer deliberately refuses tocreate vacancies as partof the conduct alleged, the fact of the absence ofvacancies can be used to argue that there is no refusal to employ. This wasnota situation directly addressed by his Honour. His Honour's approach asksthe question whether the lack of vacancy would, or mighthave, existed were itnot for the proscribed conduct. In the case before him, the answer was nobecause the workforce had been assembledmonths before the alleged refusal.The decision, therefore, does not assist the respondents in the circumstancesof this case.

61His Honour's reasoning, however, does not support the approach to theconstruction of the expression "refuse to employ" thatI prefer. On thatlatter construction, the fact that Gallagher and Arnold were not givenemployment, even though there was noneotherwise available, would have amountedto a refusal to employ. The no case submission would have failed. Theprohibited intentwould have been presumed. But, on the facts, the defendantprobably could have shown that the reason for the refusal was that nojobs wereavailable. His Honour did not consider this alternative approach. Heexplained that he had limited time overnight toconsider the question, andwould have preferred more time. Further, he adverted to the fact that theprovision under considerationcreated a criminal offence. Those factors mayhave had a bearing on the approach adopted. His Honour, however, did considertheoperation of the reverse onus provision in this context. He saidat 118-9:

`Section 334(6) renders it unnecessary for a prosecutor toprove, relevantly, the reason why a defendant refused to employ. Howeverthereference to "reason" in the opening words of s 334(6), must be read incontext. In the concluding words of s 334(6) there isa further referenceto "reason" as part of the composite expression, "reason specified in thecharge". That is plainly a referenceto the matters referred to in the variousparagraphs in subs (1), (2), (3), (4) and (5) of s 334 which, in the main,relate to theprotected status or characteristic of the person who is said tohave been victimised in a proscribed way.

In my opinion, the word "reason" when first appearing in s 334(6), is areference to the matters in those paragraphs. Thus s 334(6)relieves aprosecutor of the obligation of proving the existence of a reason contained inthe relevant paragraph relied upon by theprosecutor in the charge, butotherwise does not affect the obligation to prove other aspects of theoffence.'

62Moore J apparently regarded the existence or otherwise of a vacancy as afact to be proved by the applicant before the onus shiftedto therespondent.

63Again, in my view, once the applicant has shown that the respondent refusedto employ the applicant, irrespective of whethera vacancy exists or not, theapplicant has discharged the onus of proof which rests on the applicant.

64InCFMEU v BHP Steel, the CFMEU alleged that BHP Steel (AIS) Pty Ltd(BHP) had, contrary to s 298K(1)(d), refused to employ Mr Gaskillbecause he was entitled to the benefit of an industrial instrument. Mr Gaskillworked at the Tower Colliery as an electrical fitter/mechanic. His employmentwas governed by an award which providedfor the payment of accumulated sickleave on retrenchment and for redundancy pay. Some retrenchments at theColliery were anticipated. BHP introduced a `VR Swap' scheme (the scheme).BHP also operated the Port Kembla steelworks. There were employees who wishedtoleave the steelworks, but BHP wished to retain their positions. BHP alloweda number of steelworks employees to swap positions withan equivalent number ofcolliery employees. The steelworks employees would then be entitled toredundancy payments and the collieryemployees would avoid retrenchment. Itwas a term of the scheme that any colliery worker transferring to thesteelworks would haveto repay any accumulated sick leave or redundancy paymentreceived from the colliery. Mr Gaskill was a junior electrician andanticipatedhe would be retrenched. So he applied for a job in the steelworksunder the scheme. Shortly after he made that application he wasretrenched andpaid his accumulated sick leave and redundancy payment. Mr Gaskill was thenoffered a position at the steelworksunder the scheme. He, however, insistedon retaining the accumulated sick leave and redundancy payments. As a result,BHP withdrewthe offer of employment at the steelworks under the scheme. Itwas alleged that BHP had refused to employ Mr Gaskill because hewas entitledto the benefits of the award. Wilcox J said at par 50 and 51:

`50A refusal to employ somebody involves discrimination orvictimisation only if there was, at the relevant time, a vacancy or prospectivevacancy. For that reason, I agree with, and apply to the current legislation,Moore J's observation that the reference to refusingto employ a personconcerns "actual employment where there is a refusal to employ a person incircumstances where, apart from therefusal, employment might or wouldarise".

51There is no doubt that BHP Steel refused to employ Mr Gaskill atthe steelworks except on the basis that he repaid benefits he had receivedunder the coal mining award. If he had been an applicantfor a vacancy at thesteelworks, I would have agreed such a refusal offended s 298K. However,there never was a vacancy availableto Mr Gaskill; there was only anopportunity to exchange positions with a similarly qualified employee, at thesteelworks, who wishedto take voluntary redundancy. Unless and until anexchange was arranged, no position was available to Mr Gaskill. Ifarrangementshad been made before his retrenchment notice took effect, therewould have been no problem. But they were not made before that date.Implementation of the proposal therefore depended on Mr Gaskill agreeing, ineffect, to revert to the pre-termination position byrefunding hisentitlements.'[emphasis added]

65In this passage Wilcox J reasoned as follows. He said that a refusal toemploy somebody involves victimisation only if there isa vacancy orprospective vacancy. In this case, he continued, "there is no doubt thatBHP Steel refused to employ Mr Gaskill ...". But there was novictimisation because there was no vacancy at the time. His Honour acceptedthat there was a refusal to employ. His reference to victimisation was areference to the reason for the refusal. He held that the reason for therefusal was the absenceof a vacancy, and not the proscribed reason. Thus, thereasoning of Wilcox J does not support the respondents' contention that thereis a broad principle that a refusal to employ cannot occur if there is novacancy to fill. Rather, it supports the approach I prefer,that the lack of avacancy is a matter to be raised by the respondent in rebuttal of thepresumption raised by s 298V.

66In the result, the cases relied upon by the respondents do not support theproposition for which they contended, namely, thatthere can be no refusal toemploy a person if there is no vacancy at the time of the refusal.

67The decided cases, applied to the present circumstances, lead to theconclusion that Belandra did refuse to employ the Belandraemployees. AlthoughFletcher did not deal with an analogous factual situation, it stands forthe view that there is a refusal to employ where, apart from therefusal,employment would have arisen. That was the position in the present case.Immediately prior to the decision not to reemploythe Belandra employees,Belandra intended to reemploy the Belandra employees. InBurnie andCFMEU v BHP Steel the latter construction of s 298K(1)(d) wasadopted. If applied in the present case that construction would also result inthe conclusionthat there was a refusal to employ. In this case there was arefusal to employ the Belandra employees when Belandra said, in September2001,that it would not offer reemployment to the Belandra employees. The questionwhether there were any vacancies to be filledby the Belandra employees, then,is a matter which the respondent can raise in relation to the existence of aproscribed reason forthe refusal, with a view to rebutting the presumptionthat the refusal was for a proscribed reason. However, if it is shown thatBelandra contrived to have no vacancies through its decision not to employ,this argument might not succeed.

WAS THERE AN ALTERATION TO THE POSITION OF AN EMPLOYEE OF BELANDRA TO THEPREJUDICE OF THAT EMPLOYEE.

68The applicant argued that, contrary to s 298K(1)(c) of the Act,Belandra altered the position of the Belandra employees to theirprejudice whenit decided, in September 2001, not to reemploy the Belandra employees. Theargument was that the employees had anexpectation just prior to the making ofthe decision that they would be reemployed. When the expectation was notfulfilled by Belandra,their position was altered to their prejudice. Theprejudice lay in the elimination of the job security which they previously had.The expectation was said to arise from the statements made after the fire bydirectors of Belandra to the effect that Belandra intendedto reemploy theworkforce. Belandra acted consistently with this approach by deferring paymentof severance entitlements.

69A necessary part of the expectation created by Belandra when it indicatedits intention to reemploy the workforce after the firewas that the Belandraemployees would have been taken back on the basis of seniority. That followsfrom cl 2.1.6 of the 2000 Agreementwhich provided:

`The employer recognises they system of seniority. Senioritywill be administered by the Consultative Committee, recognising thatemployeesbeing employed on the basis of seniority have the skills required for the jobsavailable.'

70It is now established that a prejudicial alteration to the position of anemployee may occur without any change in the employees'legal rights. InCommunity & Public Sector Union v Telstra Corporation Ltd(2001) 104IR 195;[2001] FCA 267 (Telstra), the Full Court was concerned withwhether an email, sent by the managing director of the Employee Relations Groupto managers andteam leaders in that Group, altered the position of employeesto their prejudice. It was found that the email instructed the managerswhenselecting employees for redundancy, to give more favourable treatment toemployees who agreed to sign individual contracts ratherthan to employees whowanted their terms and conditions of employment to be governed by an award orcollective agreement. The FullCourt said at par 17-19:

`17.The question is whether, by sending the e-mail to itsrecipients, Telstra hadalteredthe positionof any of itsemployees to the employee's prejudice within the meaning of s 298K(1)(c).InPatrick Stevedores (at 18) the majority of the High Court held thatthe section covers "not only legal injury but any adverse affection of, ordeteriorationin, the advantages enjoyed by the employee before the conduct inquestion". The majority also observed (at 20) that the reorganisationofcompanies within the Patrick Group resulted in the security of the employercompanies' businesses being "extremely tenuous" withthe "security of theemployees" employment [being] consequentially altered to their prejudice'. Thereorganisation did not directlyaffect or alter any legal rights or obligationsof the employees but it left their future employment less secure. Althoughthisissue was not in dispute, the majority appears to have had no difficultyin accepting reduced security of future employment as fallingwithins 298K(1)(c) because it brought about an adverse affection of, or adeterioration in, the advantages enjoyed by the employeesbefore thereorganisation.

18.Where the alteration of position is alleged to be indirect orconsequential, as inPatrick Stevedores and in the present case, adifficult question may arise as to whether a prejudicial alteration of positionhas in fact occurred. Answering that question may involve questions of degree.It is sufficient for present purposes to say that if the prejudicial alterationis real and substantial, rather than merely possible or hypothetical, it willanswer the description in s 298K(1)(c).

19.Before the sending of the e-mail Telstra's employees employed underawards and certified agreements enjoyed the benefit of beingsubject toredundancy only in accordance with a process which rated their eligibility forredundancy on the basis of merit, whichwas to be determined by application ofthe five principal criteria stipulated for the resource rebalancing process.There was anadverse affection of, or deterioration in, that benefit after thesending of the e-mail as a result of the additional detrimentalcriterionapplicable to employees employed under awards or certified agreements. Thedetrimental criterion was real and substantialfor the employees whom itaffected.'

71It follows that, even if the Belandra employees had no legal right toreemployment, the fact that their expectation of reemployment,raised by theemployer, was disappointed amounted to an alteration of their positions totheir prejudice.

72The next issue raised is whether a prejudicial alteration of position unders 298K (1)(c) can only occur if an employment relationexists at the timeof the alteration. Both the language of the Act and authority suggests thatthis is not the case. The languageof s 298K(1)(c) contrasts with thelanguage of s 298K(1)(b) in that the injury referred to in (b) is in the"employment", whereasthe alteration referred to in (c) is to the "position" ofan employee. Further, "employee" is to be read in the extended sense providedfor in s 4(1), namely, "... a person whose usual occupation is that ofemployee". It will be recalled that inLinehana meat worker wasemployed under an award which provided for regular daily hire. That meant thatthe employment came to an end atthe end of each day, but the engagementcontinued until terminated by notice. While the engagement subsisted, theemployee was obligedto offer himself for work unless he was notified that hewas not required. Ellicott J found that the employer had altered theapplicant'sposition to his prejudice by failing to recognise his expectationof reemployment in accordance with his engagement as a regulardaily employee.His Honour said at 61-2:

`... I am satisfied beyond reasonable doubt that he was engagedwith the status of a regular or permanent employee who, although hisemploymentterminated at the end of ordinary working hours on each day, was entitled tocertain benefits including theexpectation of work each day if, pursuantto his obligation to do so, he turned up and it was available. He was alsoentitled to annual leave and sick leavepayments. When his employment ended on21^st December, 1979, and the company refused to treat him thereafteras having regular or permanent statushe lost this status and theexpectations and benefits that went with it. By doing so, the defendantaltered Mr. Foley's positionto his prejudice.'[emphasisadded]

73Gray J addressed the issue inGilbertsonin the passage extractedat par 39 of these reasons. He held that there may be a prejudicialalteration to the position of a personwith whom there is no longer anyemployment relationship subsisting.

74In September 2001, before Belandra decided not to reemploy them, theBelandra employees were persons whose usual occupation wasthat of employee.They had been employees of Belandra until 20 June 2001, and immediatelyafterwards they were waiting to be reemployedby Belandra when the worksreopened. Therefore, although the Belandra employees were not in an employmentrelationship with Belandraat the time of the decision not to reemploy them,they were employees within the extended definition of employee in the Act.Theywere therefore in a position which, if altered to their prejudice, couldfound a claim to a breach of s 298K(1)(c).

75The respondents then contended that even if the position of the Belandraemployees was susceptible to prejudicial alteration,no such alteration hadoccurred because Belandra had no obligation to reemploy them. Nothing in the2000 Agreement, it was contended,gave the employees any right to a job aftertheir employment was terminated. There was therefore no prejudice to theirposition. They were not employed by Belandra before the decision, and theyremained not employed by Belandra after the decision.

76Whilst it may be accepted that the employees had no legal right toreemployment, the respondents' contentions do not meet thecase put by theapplicant. That case is based on the denial by Belandra of the expectation ofreemployment raised by Belandra.LinehanandGilbertson showthat the failure of an employer to fulfil an expectation which falls short of alegal obligation may constitute alteration tothe position of an employee tothe prejudice of that person.

77The respondents also argued that Belandra had not acted against anyindividual employee, and that s 298K was directed only toconduct that wastaken against an individual employee. They relied on a passage in the judgmentinBHP Iron Ore Pty Ltd v Australian Workers' Union & Ors(2000) 102FCR 97:[2000] FCA 430 (BHP v AWU) at 35 as follows:

`It has to be borne in mind, in construing s 298K, that itproscribes conduct by "an employer" directed to "an employee" or"other person" (emphasis added). That use of the singular suggests thatthe alleged injury or alteration of position has to be examined in thelight ofthe circumstances of each individual employee. (it is not the point that inthe interpretation of statutes, the singularordinarily includes the plural;here we are concerned with the indications of legislative intention to bediscerned from the actuallanguage used.) It is also significant that theconduct struck at by each paragraph of s 298K is expressed by an activeverb: `dismiss',`injure', `alter the position', `refuse to employ', and`discriminate'. That implies that the proscription is essentially againstanintentional act of the employer directed to an individual employee orprospective employee.'

78BHP v AWU concerned offers of individual agreements made to allemployees. The prejudicial alteration which was alleged was the reductionincollective bargaining power of the union. As the Full Court pointed out, anyreduction in union power was the result of someemployees accepting and somerejecting the offers. The offer "of itself, did not change, in either absoluteor relative terms, theremuneration or any of the conditions of employment ofthe employee to whom the offer was made" (at par 38). The above passagemustbe understood in this context. Indeed, inTelstra, the Full Courtexplained the passage, at par 21, as follows:

`Telstra also relied on the observation by a Full Court of thisCourt inBHP Iron Ore Pty Ltd v Australian Workers' Union[2000] FCA 430;(2000) 171 ALR680 at[35] that the proscription in s 298K(1) "is essentially against anintentional act of the employer directed to an individual employeeorprospective employee". Telstra contended that the e-mail was not anintentional act directed at any individual employee.However, theobservation of the Full Court also holds true where the act is intentionallydirected at a number of unidentified employees. The e-mail in its termsdiscriminated against each employee of Telstra who was employed under an awardor a certified agreement. Accordingly,liability arises where the conductis directed at a number of ascertainable employees as well as against aparticular employee.'

[emphasis added]

79This latter passage applies to the present case. By refusing to reemployits previous workforce, Belandra acted against the ascertainablegroup ofemployees who were formerly employed by Belandra under the 2000 Agreement.Each employee was no less individually targetedbecause all of the Belandraemployees were prejudiced by the change in their individual positions.

80Finally, the respondents' written submissions included the followingargument:

`Which of the former employees had their positions altered totheir prejudice? It was not known by anyone how many could possiblybere-employed. Not until the facts of any possible new operation emerged in 2002could it be known whether prejudice occurred ....'

81The respondents relied on a passage inMaritime Union of Australia& Ors v Geraldton Port Authority & Ors(1999) 93 FCR 34;[1999] FCA 899 (Geraldton) to support this argument. In that case, the GeraldtonPort Authority decided to reduce the size of its workforce. A voluntaryredundancy program was implemented. For those who declined voluntaryredundancy, the Authority threatened to use the redeploymentprovisions of thePublic Sector Management Act 1994(WA). In response to the argumentthat the threat to use the redeployment provisions was an alteration to theposition of the employeesto their prejudice, RD Nicholson J said, atpar 265:

`In my opinion it follows that the prospect of redeploymentcannot in itself necessarily constitute a threat to injure or a threatto alterthe position of an employee to the prejudice of that employee. Until the factsof the redeployment fall out it is not knownwhether they will be injurious orprejudicial. It remains open, as the PSM Regulations expressly acknowledge,that redeploymentcould take place either without injury or prejudice or withenhancement. The second applicants cannot therefore now establish athreat toinjure in employment or a threat to alter their position in this respect.Evidence which established that the isolatedlocation of Geraldton meant thatredeployment in that area would be difficult is not evidence which establishesthe necessary injuryor prejudicial alteration. In the circumstance of thismatter s 298K(1)(b) cannot operate in respect of a threat to redeploy andwould only operate where there was evidence arising from a particular proposedredeployment. Even then, the fact that provisionfor redeployment formed partof the conditions of employment would require closeconsideration.'

82The circumstances inGeraldton are distinguishable from thecircumstances in the present case. InGeraldton, the alteration to theposition of the employees, namely, their redeployment, had not occurred. Itwas in prospect. His Honourwas not able to determine whether the redeploymentwould be prejudicial until it had occurred and the terms of it were finalised.In the present case, the alteration to the position of the employees which isasserted is the change in the security of their employment. That alterationtook place when Belandra decided not to reemploy the workforce. Hence, thereference toGeraldton does not assist the respondents.

83In the result, the decision of Belandra to refuse to reemploy the Belandraemployees constituted an alteration to the positionof each of them to theirprejudice within the meaning of s 298K(1)(c).

84The applicant has discharged the onus in demonstrating that Belandra was anemployer and that it both refused to employ the Belandraemployees, and alteredtheir positions to their prejudice. Belandra's arguments that its conduct wasnot for a prohibited reasonsmust now be considered.

WAS A REASON FOR BELANDRA'S CONDUCT THAT THE BELANDRA EMPLOYEES WEREENTITLED TO THE BENEFIT OF AN AGREEMENT?

WAS THERE AN EXISTING ENTITLEMENT TO THE BENEFIT OF THE 2000 AGREEMENT INSEPTEMBER 2001?

85The applicant contended that the Belandra employees, whose employment wasterminated in June 2001, were entitled to the benefitof the 2000 Agreement inSeptember 2001, when Belandra refused to reemploy them.

86In answer to this contention, the respondents relied onBurnie. Itwill be recalled that in that case Mr Rolls applied for employment with theBurnie Port Corporation. That employment would havebeen regulated by anexisting collective agreement unless the prospective employee agreed to enteran AWA, that is, an individualemployment agreement which would prevail overthe collective agreement. Mr Rolls did not wish to sign an individualagreement. The Corporation refused to employ him because of this, and itengaged other applicants. It was alleged that the Corporation refusedtoemploy Mr Rolls because he was entitled to the benefit of the collectiveagreement, and thereby the Corporation acted for thereason proscribed bys 298L(1)(h). It was argued that the reference in the section to anentitlement was a reference not only toan existing entitlement, but also to anentitlement that would arise on employment. The Full Court rejected thisargument, and saidat pars 22 - 25 and par 28:

`22It will be seen that the appeal raises the importantquestion of whether s 298L(1)(h) is only concerned with a present orexisting,rather than a contingent or prospective, entitlement to the benefitof an industrial instrument or order.

23The ordinary and natural meaning of ss 298K(1) and 298L(1)(h) is that,when the proscribed conduct occurs, the person concernedhas, or enjoys, apresent or existing legal entitlement to the benefit of an industrialinstrument or order.The benefit might relate to the proposed employment ormight have resulted from prior employment, but at the time of theproscribed conduct it must be a benefit to which the person concerned isentitled. The meaning contendedfor by the Union would require thats 298L(1)(h) be construed as relating to a benefit to which the personconcerned is or wouldbe entitled if the proscribed conduct had notoccurred.

24A major difficulty confronting the Union's proposed interpretation ofs 298L(1)(h) is that in s 298L(1), when the legislatureintended todistinguish between a past, present or future event or state of affairs, it didso. For example, s 298L(1)(a) refersto where the person the subject ofthe proscribed conduct `is, has been, proposes to become or has at any timeproposed to become'a member etc of an industrial association. The careful useof terms in s 298L, suggests that when the legislature used the words"isentitled" in s 298L(i)(h), it intended to refer to a present or existing,rather than a future or prospective, entitlement.

25The Union claimed that its interpretation gives effect to the legislature'sintention that an employer may not discriminate betweenemployees by imposingupon actual, or prospective, employees the employer's preferred mode ofindustrial regulation. It is plainthat ss 298K(1)(d) and 298L(1)(h)intend to prohibit an employer from discriminating against an employee on thebasis of the employee'sexisting entitlements under industrial instruments ororders. However, it is far from clear that the sub-sections were intendedtoprohibit an employer from offering to prospective employees employment on termsand conditions that give effect to the employer'spreferred mode of industrialregulation under the Act.

...

28In the circumstances we are unable to discern any legislative policy orintent that an employer be prevented from offering toa prospective employeeone form of industrial regulation under the Act rather than another. Putanother way, we do not discern alegislative policy or intent in respect of theanti-discrimination provisions in ss 298K(1)(d) and 298L(1)(h) that it isthe prospectiveemployee, rather than the employer, who is to be entitled tochoose the mode of industrial regulation under the Act that is to applyto hisor her employment, where more than one form of such regulation is available inthe prospective employer's workplace. Yetthat consequence flows from theUnion's interpretation of those provisions. In our view the Union'sinterpretation is not supportedby the ordinary and natural meaning of theprovisions or by any discernible legislative policy or intention in respect ofprospectiveemployees.' [emphasis added]

87This decision construed the word "entitled" in s 298L(1)(h) asreferring to an existing entitlement. But the Court expressly recognisedthatan existing entitlement may be held by a prospective employee or anex-employee.

88In the present case, in September 2001, the Belandra employees retained atleast the entitlement under the 2000 Agreement tothe benefit of cl 2.8.4,which provided for severance pay after eight months from the date oftermination. It follows that the Belandraemployees were entitled to thebenefit of the 2000 Agreement at the time of the refusal by Belandra toreemploy them.

THE CAUSAL LINK

89The respondents then argued that the causal link required by s 298K(1)between the conduct, namely the refusal to employ or theprejudicialalteration, on the one hand, and the reason, namely the entitlement to thebenefit of the agreement, on the other hand,was lacking. The writtensubmissions of the first, fourth and fifth respondents stated, atpar 106:

`... the circumstance that it is the application of anindustrial instrument in a workplace that is thecause of the situationthat an employer wants to address does not make the application of theindustrial instrument to the employees concernedthereason for theaction taken by the employer to address that situation.'

90A distinction between the cause of the situation and the reason for theaction was explained by Merkel J and Finkelstein J inGreater Dandenong CityCouncil v Australian Municipal, Administrative, Clerical and Services Union(2001) 112 FCR 232;[2001] FCA 349 (Greater Dandenong). The councilemployed people to provide home and community care services. Legislation wasintroduced which required a proportionof council expenditure to be the subjectof competitive tendering. The council decided to put out to competitive tenderthe homeand community care services. Two bids were received. One was anin-house bid, and the other was from an organisation called SilverCircle. TheSilver Circle bid was for $6.6 million and the in-house bid was for $7.7million. The difference in price was largelyaccounted for by the fact thatthe award covering Silver Circle employees provided less pay for the same workthan the award coveringcouncil employees. The council was aware that if theSilver Circle offer was accepted, the council employees would be maderedundant,and they would be engaged, at least initially, by Silver Circle.They would do the same work as before, but would be paid less todo it. Thecouncil accepted the Silver Circle tender. The trial judge, and Wilcox J onappeal, held that by accepting the SilverCircle tender, the council alteredthe position of the employees to their prejudice because they were entitled tothe benefit ofthe award covering council employees. This conduct amounted toa breach of s 298K(1)(c) and s 298L(1)(h). Merkel J did not acceptthat the employees had established that the higher award entitlements was "anoperative reason" for the council's conduct. He said,at par 164:

`... the cases demonstrate that s 298K is not concernedwith thecause of the prejudicial conduct. Rather, it is concerned withthe employer'sreason or reasons for engaging in that conduct. Thus,there can be a significant difference between the employer's subjective reasonfor engagingin prejudicial conduct and the objective circumstances that led tothe employer engaging in the conduct.'

91He continued, at par 167:

`In my view the proper inferences to be drawn from the primaryfacts found by the primary judge are that an operative reason for thecouncil'sresolution to accept Silver Circle's tender was its lower price and that acircumstance that led to it accepting the lowerprice was the higher Award andAgreement entitlements of the HACC[council]employees. While thehigher entitlements may be causally linked to the council's acceptance of theSilver Circle tender, the evidencedoes not support the primary judge'sconclusion that they were an operative reason for the council's acceptance ofthe tender. Nocouncillor or council document stated that the entitlementswere a reason for the council's acceptance.The inference drawn by theprimary judge to the contrary was based on an approach that, erroneously,failed to distinguish betweenthe operative reason for the council acting andthe circumstances that led to the price of the in-house bid being higher thantheprice of the Silver Circle bid. The fact that the councillors wereaware of, or considered, those circumstances does not make them a reason fortheir decision. This is not a case of a council not being prepared to payAward or Agreement entitlements or seeking to discriminate against itsemployees by reason of those entitlements. Rather, it is a case of a council,that is required by law to engage in a competitivetendering process, acceptingthe most competitive tender which met the objective criteria it specified.'[emphasis added]

92Merkel J, however, dismissed the appeal because the council had failed todischarge the onus of showing that the acceptance ofthe Silver Circle tenderwas not because of the employees' entitlement to the benefit of an industrialinstrument.

93Finkelstein J would have allowed the appeal, and also made a distinctionbetween the cause of conduct and the reason for conduct. He said atpar 199:

`According to these cases, to decide whether an employee hasbeen unlawfully dismissed, it is necessary to ascertain the true motivefor, orpurpose of, the dismissal. If there is some legitimate reason for thedismissal, such as the desire to avoid bankruptcyor the need to maintain aprofitable operation, the dismissal will be lawful. It matters not that thecause of the impending bankruptcyor the unprofitable trading is the high rateof wages payable under an award or certified agreement. That is to say,although the benefits produced by an award or certified agreement have causedthe problem which the employer seeks to address, thatdoes not necessarily makethose benefits the "reason" or motive for his act.'[emphasisadded]

94He also said, at par 204:

`Thus, there has been an unbroken line of State and federalauthority in favour of the proposition that, for the purpose of decidingwhether there has been an unlawful dismissal for the reason that an employee isentitled to the benefit of an award or certifiedagreement,it is necessaryto draw a distinction between the "reason" or motive behind the dismissal andwhat produced that motive.'[emphasis added]

95And finally, at par 216, his Honour said:

`It seems to me thatthe trial judge failed to distinguishbetween the immediate reason for the relevant act, be it the dismissals or theacceptance ofthe Silver Circle award, and the proximate reason for thatact. I can make the point by reference to two sentences in the reasons.The trial judge said: `The major and decisive factor in theSilver Circlebid's acceptance was its price. The major and decisive factor in thedifference in price was that, as everyone conceivesit, Silver Circle wouldremunerate the workers doing HACC work under the Silver Circle award and notthe council's industrial instruments.' The finding that price was a "major anddecisive factor" is plainly correct. To describe the other "major and decisivefactor"(that the price difference was the result of different award rates) asa motive for the decision is where the error is to be found. This "major anddecisive factor" is not what motivated the decision but merely explains thedifference in price.'

[emphasis added]

96InMaritime Union of Australia v CSL Australia Pty Ltd(2002) 113IR 326;[2002] FCA 513, Branson J said, at par 54:

`It is difficult, if not impossible, to identify theratiodecidendi ofGreater Dandenong. However, two members of the FullCourt (Merkel and Finkelstein JJ) concluded that the learned primary judge haderroneously failedto distinguish between the operative (or immediate) reasonof the Council's conduct and the cause (or proximate reason) for the Council'sconduct. While, as it seems to me, this distinction may in many cases beeasier to articulate than to draw, especially in respectof a statutoryprovision that recognises the possibility of a number of reasons having acausal connection with conduct, I considerthat I should be guided by theapproach taken by Merkel and Finkelstein JJ who constituted a majority of theFull Court inGreater Dandenong on this issue. I am fortified in mydecision to adopt this approach by the fact that the approach appears to me tobe consistentwith that adopted by R D Nicholson J inMUA vGeraldton.'

97The passage fromGeraldton, to which Branson J referred, so far aspresently relevant stated:

`I agree with the submission for the GPA[Geraldton PortAuthority] that the words "for" in s 298K(1) and "because" ins 298L(1) require a causal connection between the act of the employerwhich injuresthe employee in his employment or alters his position to hisprejudice and the status of the employee as a union member, in the caseofs 298L(1)(a), or as a person entitled to the benefit of the Award orAgreement, in the case of s 298L(1)(h). The inquiry is directedto thereasons of the employer.

I also agree[sic]the fact that there is some connection between theemployer's act and the employee's union membership or entitlement to thebenefitsof an award does not mean that the employer did the actbecausethe employee was a union member or entitled to the benefit of the award.Whether an employer was actuated by a prohibited reasonor reasons whichincluded a prohibited reason is a question of fact. It will often involvequestions of judgment and the characterisationof the employer's reasons: cfWood v City of Melbourne[1979] FCA 22;(1979) 26 ALR 430. For example, if an employermade a decision to make his operation more efficient or to facilitate theprovision of services to theservice users at a lower cost (and for no otherreason) that action is not open to the inference of having been taken forreasonswhich include that the employees are members of a union or have thebenefit of an award.'

98The respondents, rightly, accepted that the existence of the necessarycausal connection will involve questions of judgment andcharacterisation. Byreferring to a distinction between a reason for an action and a cause of thesituation which an employer seeksto address, Merkel and Finkelstein JJ inGreater Dandenong did not establish any principle to be applied to theconstruction of the section. They merely engaged in a process ofcharacterisationof the particular facts before them. In the end, the questionremains whether the conduct was carried out "because" of the specifiedconduct.It must be remembered that s 298L(1) is an interpretation section. Thesection defines what constitutes a prohibited reasonfor the purposes ofs 298K(1). Thus, the process of characterisation must focus on the"because". No verbal formula, whether byreference to a distinction betweenreason and cause, or between an immediate cause and a proximate cause, can takethe place of thestatutory requirement that the conduct be carried out"because" of the specified reason.

99This approach is supported byLewis Construction Co Pty Ltd v Martin& Ors(1986)70 ALR 135;[1986] 17 IR 122, whichwas relied upon by the applicant. Mr Martin was dismissed by his employer,Lewis Construction Co Pty Ltd (Lewis). The trialjudge found that he had beendismissed because he was a member of the Builders Labourers' Federation. GrayJ (with whom Woodwardand Jenkinson JJ agreed) said at 137:

`The argument on behalf of Lewis was that the learned trialjudge had found that the relevant officers of Lewis believed that dismissalofall members of the BLF employed by Lewis was the only course open to it as ameans of countering a campaign or campaigns thenbeing conducted by the BLF.Because of this finding, the fact that Mr Martin was a member of the BLFdid not amount to a reason whyhe was dismissed; membership of the BLF was nomore than the criterion for selection of those who were beingdismissed.'

100And, at 139, he said:

`In failing to lead any evidence to support the proposition thatMr Martin's membership of the BLF was not a substantial and operativefactor in the decision to dismiss him from his employment, Lewis failed toexclude that reason as such a substantial and operativefactor, and thereforefailed to discharge the onus of proof imposed upon it by s 5(4) of theAct. The attempt to characterise MrMartin's membership of the BLF as afactor in a reason, rather than a reason in itself, must also fail. The Actand the authoritiesdo not distinguish between a "reason" and a "factor";indeed, inBowling, these terms are used interchangeably. The attemptto decide whether a particular circumstance was a factor in a reason, or areasonitself, tends to distract fromthe essential question, which iswhether that circumstance was a substantial and operative factor or reason inthe decision.'

[emphasis added]

101This legal analysis of the issues of causation will be applied to thefinding of fact concerning the reasons for Belandra's action,which are madelater in these reasons.

WAS A REASON FOR BELANDRA'S CONDUCT THAT THE BELANDRA EMPLOYEES WERE MEMBERSOF THE UNION?

Introduction

102There was disagreement between the parties as to the scope ofs 298L(1)(a).

103The respondents contended that the reference to union membership was areference limited to the fact of belonging to a union. On this approach, acase does not come within s 298L(1)(a) if a reason for the employer'sconduct is, for instance, that the employeehas engaged in activities as aunion member. The respondents relied upon a passage from the judgment of KennyJ inAustralian Workers' Union & Ors v BHP Iron-Ore Pty Ltd(2000)106 FCR 482;[2001] FCA 3 (AWU v BHP Iron-Ore), at par 66 asfollows:

`In written submissions, the applicant referred to remarks ofWilcox and Cooper JJ inDavids Distribution at 500-501; 583, and statedthat their:

"... argument that membership of an industrial association was one of theRespondent's prohibited reasons is based on a conceptand understanding ofmembership as being broader than simply the possession of a membershipticket."

I do not accept this submission. Section 298L(1)(a) refers to membershipof and holding office in a union. I do not think it isintended to cover anybroader notion than that. Section 298L(1) (which describes what is aprohibited reason for s 298K(1) purposes)consists of 14 detailedparagraphs and a number of subparagraphs designed to protect an employee'sfreedom to join a union and toparticipate in union activities in a number ofdisparate situations. In Davids Distribution, their Honours were referring totheprotection conferred by s 298L(1), considered as a whole. Theirobservations do not provide a basis for saying that par (a) ofs298L(1) is concerned with anything other than being, or proposing tobecome, a member (or an officer or delegate) of an industrialassociation. Theconcept of membership is recognised and dealt with in Pt IX, Div 9 of the WRAct.There is nothing in the terms of par (a) or elsewhere in the WRAct to justify the applicants' submission that par (a) is concernedwith aperson's activities as a member, officer or delegate of an industrialassociation. At least some of those activities areprotected elsewhere ins 298L(1): see, for example, pars (f), (g), (i), (m) and (n).'[emphasis added]

104The applicant submitted in response that the concept of membership isbroader than the mere holding of a union ticket. It reliedupon a passage froma judgment of Gray J made at the interlocutory stage of the same proceedings,(Australian Workers' Union and Others v BHP Iron Ore Pty Ltd)(2000) 96IR 422;[2000] FCA 39, at pars 35 and 46, as follows:

`35....The concept of membership, for the purposes of thisprovision, is more than a mere formality. It includes the notion of theability to have terms and conditions of employment regulated on a collectivebasis: see the judgment of Wilcox and Cooper JJ inDavids Distribution PtyLtd v National Union of Workers[1999] FCA 1108;(1999) 91 FCR 463 at 500; 91 IR 198 at 233....

...

46.InDavids Distribution Pty Ltd v National Union of Workers (at500; 233), Wilcox and Cooper JJ said:

"Section 298K forbids an employer from dismissing an employee for aprohibited reason or for reasons that include a prohibited reason. Theprohibited reasons are contained in s 298L. Each of the reasons relatesto the exercise of the right of an employee or independentcontractor to join,or refuse to join, an `industrial association' (as defined) and, where theemployee becomes a member of an industrialassociation, to take collectiveaction by or through the industrial association in pursuit of their industrialinterests. Section298L(1)(l) is concerned to ensure that an employee who isdissatisfied with his or her industrial conditions is not discouraged fromparticipation in concerted action engaged in by the industrial association ofwhich the employee is a member and which is seekingbetter industrialconditions. The objective of s 298K is to ensure the threat of dismissalor discriminatory treatment cannot beused by an employer to destroy orfrustrate an employee's right to join an industrial association and to take anactive role in thatassociation to promote the industrial interests of both theemployee and the association.

In the context of the Act, Pt XA does not stand alone. It is aimed atensuring that employees may band together, if they wish, forcollectivebargaining of the type provided for in the Act to achieve the broaderobjectives of the Act as contained in s 3. In thisregard the Actoperates in the same way and to the same ends as similar legislation in theUnited States of America. ... That whichis protected by such legislation ismore than the right to be a member. It is the right to participate inprotected union activities,including the taking of collective industrialaction against an employer to seek to obtain better industrial conditions...."'

See alsoStephen Phillip Gibbs v The Palmerston Town Council(unreported, Gray J, 21 December 1987, at p 99)(Palmerston).

105InAWU v BHP Iron-Ore, the terms of employment of the employeesin the employer's Pilbara iron-ore mining and transport operations had beengoverned bycollective agreements or awards negotiated by a number of unions.Most of the employees were members of one or other of the unions. UnderWestern Australian industrial legislation such collective agreements would bedisplaced by individual employment agreements. The employer offered individualemployment agreements to the whole work-force. The agreements provided forhigher wages and otherincentives to those who signed. The unions broughtproceedings alleging breaches of s 298K. They argued that the employerhad injuredemployees and altered their position to their prejudice in breachof s 298K(1)(b) and (c) by making the offers of individual employmentagreements. A reason for the conduct was alleged to fall withins 298L(1)(a). Her Honour described the applicant's case, at par63,thus:

`The applicants' case under s 298L(1)(a) must be that BHPIOdiminished the collective bargaining power of a non-accepting employee,andmade him or her ineligible for the accrued leave option, for reasons thatincluded that the employee was a member of an industrialassociation.'

106Kenny J held that the offer of individual employment agreements did notconstitute injury or prejudicial alteration within themeaning ofs 298K(1)(b) and (c) because the diminution in collective bargaining powerresulted from the acceptance by some employeesand the rejection by otheremployees of offers made indiscriminately to all employees. Thus, it was notnecessary for her Honourto consider whether the conduct was for a prohibitedreason. Her Honour's reflections on that matter areobiter dicta.Nevertheless, those reflections are a useful starting point for a considerationof the issues in the present case.

107In the passage which is extracted in par 102 of these reasons, Kenny Jheld that s 298L(1)(a) is not concerned with the activitiesof a person asa member of a union. Two reasons were given. One was that there was nothingin the section or elsewhere in the Actto suggest the contrary. The other wasthat some activities of union members were expressly protected in some of thefollowing subsectionsof 298L(1).

108The question which her Honour considered was whether conduct was carriedout by the employer because an employee was "a memberof an industrialassociation", when that conduct was carried out because the person had engagedin activities as a union member. There is another question arising from theconstruction of s 298L(1)(a). That question is whether conduct wascarried out becausea person was a "member of an industrial association", whenthe conduct was carried out becausea unionengaged in activities as anincident of the person being a member of the union.

109This latter issue seems to have been the basis of the case put by theunions inAWU v BHP Iron-Ore. In par 65, immediately before thepassage relied upon by the respondents in the present case, her Honour said:

`The applicants' real case, so far as BHPIO is concerned, isthat the company offered WPAs[Workplace Agreements] on terms to all itsemployees as part of a stratagem to reduce union membership (at that time heldby most of its workforce) in orderto diminishthe unions' bargainingpower.'[emphasis added]

110Her answer was:

`This case is properly considered unders 298M.'

111There is no discussion as to why such a case would not fall withins 298L(1)(a). Nonetheless, there may have been an implicitdeterminationto that effect. Alternatively, the question may not have been considered. Ineither event, there is little assistanceto be derived from the case on thisaspect.

112However, in the present case, it is necessary to determine the scope ofs 298L(1)(a) as it applies to union members and theactivities of unionson their behalf. There are four possible limits to the operation ofs 298L(1)(a), namely that the conduct isengaged in because, a) theemployee belongs to a union; b) the employee is involved in activities as aunion member; c) the unionis involved in activities on behalf of theindividual employee; d) the union is involved in activities as an incident ofan employeebeing a member. In the present case, the question is whethers 298L(1)(a) extends to the reason referred to in (d). An appropriatestarting point for this inquiry is an examination of the statutory backgroundand context of the provision.

Statutory Background and Context

113The statutory background and context indicates that the protection againstdiscrimination or victimisation on the basis of unionmembership is of thebroadest kind considered above. It extends to protection againstdiscrimination or victimisation directed toa person because of actions takenby a union as an incident of that person being a member of the union.

114Section 9(1) of the originalCommonwealth Conciliation andArbitration Act1904 (the original Act), provided:

`9.(1)No employer shall dismiss any employee from hisemployment by reason merely of the fact that the employee is an officer ormember of an organization or is entitled to the benefit of an industrialagreement or award.'

115The terms of the original section bear a close resemblance to the termsof s 298L(1)(a). An understanding of the scope of theoriginal provisiontherefore sheds some light on the scope of the current provision.

116At Federation, the main concern in labour relations was to control labourstrikes in order to prevent a recurrence of the widespreadstrikes which hadoccurred in the 1890s. Section 51(xxxv) of the Australian Constitution(the Constitution) did not give the FederalParliament a general power toregulate employment relations. Rather, it gave a limited power to legislatewith respect to "conciliation and arbitration for the prevention andsettlement of industrial disputes extending beyond the limits of any oneState." Thus, the original legislation related only to interstateindustrial disputes. It prohibited strikes (and lockouts), but providedfor apeaceful means of settling such disputes by conciliation and/or arbitration.The Commonwealth Court of Conciliation and Arbitration(the Arbitration Court)was established, and was given power to make awards in settlement of interstateindustrial disputes.

117The legislation was directed to the resolution of widespread disputation,not to the resolution of individual disputes betweena single employee and asingle employer. The system that was created depended on the collectiveparticipation of employers and employees. In order to provide for suchparticipation, the original Act allowed for the registration and incorporationof employer and employeeorganisations. There were substantial advantagesflowing from registration under the original Act. Registered organisationsweregiven the right to institute proceedings in the Arbitration Court, and hada right of audience before the Arbitration Court. TheArbitration Court wasempowered to award preference to union members. No new organisation could beregistered if there was an existingregistered organisation to which personscould conveniently belong. InThe Jumbunna Coal Mine, No Liability andAnother v The Victorian Coal Miners' Association(1908) 6 CLR 309, the HighCourt upheld the provisions of the original Act which provided for theregistration and incorporation of organisations,and for the rights andobligations of those organisations. The High Court determined that suchprovisions were incidental to theexercise of power under s 51(xxxv) ofthe Constitution. O'Connor J explained the rationale for the creation ofregistered organisations,at 350-1, as follows:

`An industrial dispute is something more than a dispute betweenan employer and his individual workmen. It is a dispute between acombinationof workmen and their employer or employers. The questions involved generallyaffect the whole trade, and a settlementis seldom adequate unless it binds thewhole trade. It is not practicable to bring all employés in a tradebefore the Court,nor all the masters. Some method of representation of thedisputants is therefore essential for the purpose of dealing with thedisputein its initial stages, of bringing the parties before the Court, and ofenforcing observance of the award.

Part V. creates a system by which associations of employers and associationsof employés may, on complying with certain conditions,be registered asorganizations. By registration they become corporations with powersspecifically limited to the purposes of theAct. They represent their memberscollectively, and thus constitute the parties with whom the Court deals forpurposes of conciliation,arbitration, and the enforcement ofawards.'

118The legislation also imposed various forms of control on unions in orderto secure proper participation in the system of industrialregulation. TheArbitration Court had power to deregister a union if the rules of theorganisation were tyrannical or oppressive,or imposed unreasonable conditionson members, or if the accounts of the union were not audited in accordance withthe rules, orif the organisation wilfully neglected to obey an order of theCourt. Unions were required to discipline members who engaged inunlawfulindustrial action, or breached orders.

119The place of unions in the compulsory arbitration system is summarised byA Frazer `Trade unions under compulsory arbitrationand enterprisebargaining: a historical perspective' in P Ronfeldt and R McCallum (eds),Enterprise Bargaining, Trade Unions and the Law, Federation Press,Sydney, 1995 at 54, as follows:

`From its inception compulsory arbitration has been assumed torequire the participation, promotion and regulation of unions as akey elementof the system. This involvement rested on two notions: that employees couldonly be effectively represented (and regulated)by collective entities; andthat certain of these entities should be given special status on registeringunder the system. Onceregistered unions became constituted as newright-and-duty-bearing legal entities and gained protections and preferencesfor boththemselves and their members. As HB Higgins recognised, the wholesystem of compulsory arbitration was based on unions; indeed,`without unions,it is hard to conceive how arbitration could be worked.' By this he meant thatit was necessary for the demandsand interests of a mass of employees to berepresented collectively by legally constituted and responsible organisations.With legalisedunions, employers could be assured that demands of employeeswere presented by a representative body and that only important issueswould bepursued. Employees would have their voice heard without fear of reprisal,since "the individual employee is generally powerless". The interest of theArbitration Court and the public it represented was also furthered since unionsin practice tended towards moderation. By constituting unions as separatelegal entities - autonomous, democratically governed and subject to decisionsof the ArbitrationCourt - the arbitration system could operate under theassumption that the interests of workers were being represented, while unionswould also ensure their members' compliance with court orders and awards.Hence the basis of compulsory arbitration was inherentlycollectivist,depending on unions as primary parties whose active participation was essentialto the operation of the system.'

120In due course, the question arose as to the basis upon which unionsparticipated in the system. Did they act as agents for members,or were theyparty principals acting on their own account? If they acted as agents formembers they could not raise a dispute withan employer who did not employunion members. That approach was rejected inBurwood Cinema Ltd vAustralian Theatrical and Amusement Employees' Association[1925] HCA 7;(1924-1925) 35CLR 528 (Burwood Cinemas). Powers J explained the position at544-545:

`The Act was passed to allow collective bargaining andsettlement of disputes, and not individual bargaining and settlement ofdisputesbetween employers and employees. As my brotherHiggins put itin the case ofAustralian Workers' Union v. Pastoralists' FederalCouncil, "the Act recognizes unions, and makes unionism a part of itsscheme. One of the `chief objects' of the Act is `to facilitate andencouragethe organization of representative bodies of employees'; and Part V. ofthe Act is specially devoted to the constitutionof organizations for thepurposes of the Act.'

121Starke J said at 551:

`An organization registered under the Arbitration Act is not amere agent of its members: it stands in their place, and acts on theiraccountand is a representative of the class associated together in the organization.It is, as my brotherHiggins said, "a party principal," and "not a mereagent or figurehead."'

122InMetal Trades Employers Association v Amalgamated EngineeringUnion[1935] HCA 79;(1935) 54 CLR 387, the High Court held that the Arbitration Court hadpower to make an award which bound employers to accord terms and conditions ofemployment to union members and non-union members alike. Latham CJ andMcTiernan J followedBurwood Cinemas in explaining the basis uponwhich unions participated in the system. Latham CJ said at 403-404:

`Industrial disputes are essentially group contests - there isalways an industrial group on at least one side.

A claim of an individual employee against his employer is not in itself anindustrial dispute. If it professes to be based upon anexisting right (as,for example, a contract of employment, or an award (seeMallinson v.Scottish Australian Investment Co. Ltd.) such a claim may give rise tolitigation in the civil Courts - but it is not an industrial dispute. If aclaim is made by an individualemployee for some improvement in his pay orconditions of employment, the refusal of the claim by his employer may resultin a personaldispute, but this in itself would not be an industrial dispute.One necessary element of an industrial dispute, as distinguishedfrom otherdisputes, is the circumstance that a demand is made by or upon a group ofemployers or employees. Thus an industrialorganization is engaged in such adispute when it makes what may be called an industrial demand on behalf of itsmembers, presentand future. In a forensic sense the organization is the partyto the dispute, though it asks for nothing for itself as an organization. Inanother sense, the existing members of the organization are the parties to thedispute. The object of the dispute is to obtainrights for them or to causethem to become subject to obligations. The future members of the organization,though not in existenceas such, are also regarded as represented in thedispute by the organization (Burwood Cinema Ltd. v. Australia Theatricaland Amusement Employees' Association).'

123Whilst the Constitution did not give the Federal Parliament a generalpower to regulate wages and conditions of employment, thereach of thecompulsory arbitration system expanded so that it became the instrument ofgeneral regulation of wages and conditionsof employment. This expansion ispartly explained as a result of the acceptance by the courts of the concept ofpaper disputes andof the doctrine of ambit. Annual national wage cases setthe benchmarks for wages and conditions, which then flowed on to many otherawards. Further, test cases established economy wide standards of employment,such as entitlements to termination and redundancypayments. In 1956,followingThe Queen v Kirby; Ex Parte Boilermakers' Society of Australia[1956] HCA 10;(1955-1956) 94 CLR 254, Parliament conferred the arbitral and conciliationfunction on the Commonwealth Conciliation and Arbitration Commission, and thejudicial function continued to be exercised by the Arbitration Court.

124Throughout the period under consideration the unions played a central rolein the compulsory arbitration system. In the firstmajor review of the system,which was completed in 1985 by the Committee of Review of Australian IndustrialRelations, (the HancockCommittee), the role of unions was acknowledgedthus:

`Trade unions and associations of employers have played andcontinue to play an indispensable part in the conciliation and arbitrationsystems. The structured system of dispute resolution developed underCommonwealth law embodies the concept of recognition by registration. Thisprovides an orderly system of representation and enables the tribunals to makeorders which bind parties `known' to them andto the law. The registrationsystem gives trade unions and employer associations special recognition underthe Commonwealth Actand gives them corporate status.'

[Report on Australian Industrial Law and Systems,Vol 2, 1985,Australian Government Publishing Service, Canberra, atpar 9.6]

125Then, as late as 1993, the Australian Industrial Relations Commissionpresided over by the President, Justice O'Connor, said inRe AluminiumIndustry Award1983(1994) 56 IR 403 at 442:

`The establishment of conditions of employment at an enterpriselevel through a system of individual contracts between a company andeach ofits employees is one at variance with our system of industrial relations, asystem which, since its inception, has been basedupon collective processes asthe means of providing terms and conditions of employment at the workplace.The present IR Act is basedon a system of collective regulation in whichregistered organisations of employers and employees acting as parties principalarean integral part of the collective processes which operate under theAct.

The company's action in deliberately seeking to eliminate the role of theunions at the workplace through the establishment of individualstaffcontracts, is inconsistent with the central role that registered organisationsare given under the IR Act, in the preventionand settlement of industrialdisputes. The Commission has a statutory obligation to encourage registeredorganisations.'

126Of course, over the years since it was introduced the statute has beenamended many times. The degree of regulation of the affairsof the unions hasbeen extended and some of the rights given to unions have been changed.However, the fundamental concept that unionshave a central role as partiesprincipal in establishing and enforcing the terms and conditions of employmenthas not changed.

127In the last ten years, two new concepts have been successively introducedinto the labour relations system. The first was enterprisebargaining, and thesecond was individual employment contracts. Both represented a shift away fromthe system of centralised compulsoryarbitration which operated in the previous90 odd years. For the purposes of the present discussion, the significantfactor is theextent to which each of these new concepts has impacted upon therole which unions have performed in the system since 1904.

128Enterprise bargaining mechanisms were introduced in theIndustrialRelations Reform Act 1993(Cth) (the 1993 Act). A major change was theintroduction of enterprise flexibility agreements, which could be made betweenemployersand employees without the necessary involvement of a union, and whichwould prevail over awards. Richard Naughton in an article,`Sailing intouncharted seas: The role of unions under theWorkplace Relations Act 1996(Cth)'Australian Journal of Labour Law,vol 10,1997, pp112-132, explained the impact of the 1993 Act on the role of unions asfollows:

`The Keating Government'sIndustrial Relations Reform Act1993 (`Reform Act') radically reshaped the IR Act. The legislation soughtto introduce a greater degree of flexibility into the Australianindustrialsystem, by making enterprise bargaining the primary focus of the system. Inspite of the changes it introduced, theReform Act retained many features ofthe traditional, collective system. Unions were guaranteed a role in certifiedagreements (the dominantbargaining instrument) and kept all theirwell-entrenched "privileges". Mitchell has described the changes made by theReform Act as an attempt to incorporate unions within the process of"deregulation". Throughout the 1980s the Federal Government `steered acourse,in co-operation with the union movement, for the bargained de-centralisation ofindustrial relations'. In this analysisthe previous Government consciouslyeschewed the `non-union' model of deregulation favoured by New Zealand,Britain, and some Australianstate systems.'

129The Liberal/National Party Coalition, elected to power on 2 March 1996,aimed at shifting the emphasis of the labour relationssystem from awardregulation of employment conditions to agreements between employers andindividual employees at the workplace level(AWA's). The original policy aiminvolved the introduction of a simple and attractive mechanism for the makingof workplace agreements,which would prevail over awards, and would not involveany necessary input by unions or the Australian Industrial RelationsCommission. The final form of theWorkplace Relations Act 1996 (the1996 Act) was a result of political compromise, necessary because the Coalitiondid not command a majority in the Senate. Inthe event, the 1996 Act did notreflect the entire original policy aim. In particular, the making of an AWAunder the 1996 Act wasa far from simple matter. In RC McCallum `AustralianWorkplace Agreements - an analysis',Australian Journal of Labour Law,vol 10, 1997, pp 50-61, Professor McCallum offered the following opinion,at p 61:

`Instead of being the centrepiece of the WR Act, I venture tothink that AWAs are likely to be relegated to the sleepy back-waterofAustralian industrial relations law.'

130Professor McCallum's view seems to be supported by recent figureswhich show the use of AWAs after seven years since their introduction. Themost recent figures produced by the Office of the Employment Advocate show thatover 90% of employees subject to the Federalstatute are employed undercollective agreements with 81.93% under Federal Awards. Only 8.95% areemployed under AWAs (Office ofthe Employment Advocate 2003, Sydney,viewed 28 August 2003, <http://www.oea.gov.au>). In a recent majorassessment of the acceptance of AWA's, R Mitchell and J Fetter, `Human resourcemanagement and individualisationin Australian labour law',The Journal ofIndustrial Relations, Vol. 45, No. 3, September 2003, pp. 294-327, theauthors express the view that:

`Despite the increasing trend in the rate of approvals, AWAsstatistically constitute only a very minor aspect of Australian industrialregulation, covering a tiny proportion of the workforce(1.9%).'

131Other provisions of the 1996 Act were directed to changing the functionsof unions. A full description is contained in Naughton,op cit. One majorchange was the modification of the "conveniently belong" test. Previously,existing unions were protected fromencroachment by new unions seeking to coverthe same members, where those members could conveniently belong to the existingunion. Under the new s 189(1)(j), a union could be registered if memberscould more conveniently belong to the new union and the new unioncould moreeffectively represent those members. This again was a political compromiseposition reached after the government soughtthe deletion of the convenientlybelong requirement altogether. Also, for the first time, the legislationprovided for enterprisebased unions (s 188(1)(c)). This allowed for theformation of a union in a single workplace. Using a different Constitutionalbasis,there was no longer a need for the organisation to be able to engage inan interstate industrial dispute. Further, the previouspolicy of encouragingthe amalgamation of many smaller unions into larger ones was countered by newDiv 7A Pt 9 of the 1996 Act. The new provisions allowed fordisamalgamation of parts of unions that had come together under previousprovisions, which had beenintroduced to facilitate amalgamation. The unionright of entry provisions (s 285A-G) provided greater rights than theoriginalBill proposed, but less than previously existed. The 1996 Act addedto the existing prohibition of victimisation of a person becausethat personwas a member of a union, a prohibition of victimisation of a person becausethat person was not a member of a union. Union preference provisions wererendered void.

132At the same time as the new legislation provided for AWAs, and restrictedthe functions of unions, the legislation sought toreduce the role of awards bysignificantly narrowing the range of matters which they could cover (ss 89A(2)and (3)). For a fulldiscussion of the treatment of awards under the 1996 Actsee M Pittard, `Collective employment relationships: reforms to arbitratedawards and certified agreements',Australian Journal of LabourLaw, vol10, 1997 pp 62-88. Nevertheless, as discussed above, awards stillregulate a large proportion of employment relationships.

133In summary, when one surveys the last century of labour relations inAustralia, one sees a clear continuity in the central roleof unions in acompulsory arbitration system for the first 90 odd years. In 1996 radicalchanges were proposed, but were considerablywatered down through politicalcompromise. The result is that the award system continues albeit in an alteredform. Unions continueto play a central, but modified, role. It would bewrong to view the current form of the legislation as having discarded theprevioussystem in favour of a totally individual contract based system. Intruth, the current statute has produced an hybrid system, inwhich theindividual contracts system has been added onto the pre-existing compulsoryarbitration model. Both exist side by side. And, in practice, the figuresdemonstrate that the award system remains far more widespread than the systemof individual contracts.

The Scope of s 298L(1)(a)

134It is in the light of this background and context that we must approach themeaning of s 298L(1)(a). The prohibited reasoncontained ins 298L(1)(a), so far as it relates to union members, has existed since1904 when the original statute was enacted. At that time, unions had thecentral functions in the labour relations system, as has just been described inthese reasons. Unionswere, for instance, responsible for bringing interstatedisputes before the court and for enforcing compliance with awards. Thesefunctions necessarily involved unions in activities such as collectivenegotiations with employers, and with investigating awardbreaches, perhaps byexercising a right of entry into the employer's premises. The exercise ofthese functions and powers was capableof generating employer resistance andantagonism. They were more likely to be the reason for an employer to dismissan employeethan the mere fact of an employee's membership of a union.Section 9 of the 1904 Act was the only protection which union membershadagainst dismissal. This context demonstrates that Parliament intended toprotect union members against dismissal caused by theunion fulfilling thefunctions towards members reposed in the unions by the Act. Consequently, I amunable to agree with Kenny JinAWU v BHP (Iron Ore) that there isnothing in the terms of s 298L(1)(a), or elsewhere in the Act, to justifythe view that s 298L(1)(a) is concerned withmore than a person'smembership of a union. Doubts about her Honour's conclusion have also beenexpressed by Weinberg J inNational Union of Workers v Qenos Pty Ltd(2001) 108 FCR 90;[2001] FCA 178 (Qenos), at pars 124 and 125.See also Marshall J inElliott v Kodak Australia Pty Ltd[2001] FCA 807(Elliott) at pars 34 and 35.

135It will be recalled that Kenny J gave, as a further reason for herconclusion that s 298L(1)(a) does not extend to conduct directedto anemployee because of that person's activities as a union member, the fact thatsub-sections (f), (g), (i), (m) and (n) partlyprotect the activities of aunion member. Although her Honour did not expressly refer to the maximexpressio unius est exclusio alterius (an express reference to onematter indicates that other matters are excluded), her reasoning reflects theapplication of that maxim. That is to say, her Honour reasoned that theexpress protections provided in ss 298L(1)(f), (g), (i), (m) and (n)indicated thatthose protections were excluded from s 298L(1)(a). Thereare difficulties with this approach.

136The maxim is applied by courts with caution:Houssein v Under Secretaryof Industrial Relations and Technology (N.S.W.)[1982] HCA 2;(1982) 148 CLR 88, atpar 10;Ainsworth v Criminal Justice Commission(1991-1992)175 FCR 564 at 575-576;[1992] HCA 10;(1992) 106 ALR 11 at 16-17;Wentworth v NewSouth Wales Bar Association[1992] HCA 24;(1992) 176 CLR 239 at 250;[1992] HCA 24;(1992) 106 ALR624 at 624-628; DC Pearce & RS Geddes,Statutory Interpretation inAustralia, 5^th edn, Butterworths, Sydney, 2001, atpar 4.26. This is because there may be other explanations for thespecific references, thansimply an intention to exclude them from the generalreference. The approach is not to be applied if it would bring about a resultthat the legislature was unlikely to have intended:Ainsworthat 575.

137Further, the history of the Act in general, and s 298L(1) and itspredecessors in particular, suggests that the activities dealtwith inss 298L(1)(f), (g), (i) and (n) were already encompassed withins 298L(1)(a). As previously explained, the history of s298L(1)(a)shows that it was intended to apply to conduct taken against an employeebecause the employee engaged in activities asa union member, and to conducttaken against an employee because of the activities of a union taken as anincident of the person'smembership. Section 298L(1)(f) and (g) concernthe institution by, and participation in, secret ballots by union members.That activityis defined by reference to the status of a person as a unionmember. Hence, the activity would fall within s 298L(1)(a).Section298L(1)(i) also includes action taken by a union member in thatcapacity. Where a member engages the industrial law, that person'sconductwill in some circumstances be properly characterised as an activity of theperson taken as a member of the union. That actionwould also fall withins 298L(1)(a). Finally, s 298L(1)(n) is directed to the activity of aunion member who has taken action tofurther the interests of the union. Suchactivity falls squarely within s 298L(1)(a) because it is an activityundertaken by a memberin the capacity of a member of the union.

138An examination of the circumstances in which each of the above subsectionswas introduced provides an explanation for the introductionof subsectionswhich have a degree of overlap and duplication with s 298L(1)(a).

139Where an amendment to industrial legislation has created a new right, suchright is often accompanied by a protection for itsenjoyment. The creation ofthe right, together with provision for its protection, constitutes a completepackage to be presentedto Parliament. However, often such protection wouldhave been provided under an existing general protection in any case. The newprovisions therefore overlap with, and highlight specific applications of,existing provisions in the Act. The following examplesdemonstrate thisprocess.

140Section 170CK(2)(b) provides that an employer must not terminate anemployee's employment for the reason of trade union membershipands 170CR(1)(a) provides for the imposition of a penalty for such conduct.These provisions are duplicated in part in s 298K(1)(a),s 298L(1)(a), and s 298U(a), (b) and (c). When the predecessor tos 170CK(2)(b) was first introduced by the 1993 Act (as s 170DF(1)(b))it was part of a new Division 3 relating to termination of employment. Theobject of the Division was to give effect to certaininternational instrumentsincluding theInternational Labour Organisation Convention (No.158)concerning Termination of Employment at the Initiative of the Employer(22 June 1982, Geneva,[1994] ATS 4) (Termination of EmploymentConvention) (s 170CA(1)). In accordance with that convention, aseries of sections (ss 170DA - G) prohibited termination without propernotice,termination without giving an employee an opportunity to defend himselfor herself against allegations of inadequate performanceor conduct, ortermination without a valid reason. The prohibition on termination for reasonof union membership was, no doubt,included in Division 3 because it was one ofthe invalid grounds for termination stipulated in Article 5 of theTermination of EmploymentConvention. It was part of that package, and was sotreated, even though that particular prohibition was already included in thepredecessor to s 298L(1)(a), namely, s 334(1)(a).

141Similarly, s 170MU prohibits an employer from dismissing an employeebecause the employee has engaged in protected action, whichis industrialaction in support of a proposed agreement (s 170ML(2)).Section 170NF provides for the imposition of a penalty forbreach ofs 170MU. These provisions are duplicated in part in s 298K(1)(a),s 298L(1)(n) and s 298U. The separate inclusion ofs 170MUderives from the provision's history. It originated in s 334A of the 1993Act. The 1993 Act introduced a package relatingto enterprise bargaining,which included a limited right to strike. The idea was that employers andemployees would bargain at theworkplace in order to reach an agreement forthat workplace. In aid of the process, the amendments made it legal for thepartiesto take industrial action. Employees were provided with protectionfrom dismissal and other consequences for engaging in the permittedindustrialaction, as part of this package of changes.

142The same packaging process, and resultant duplication, can be seen inoperation in relation to ss 298L(1)(f), (g), (i) and (n). As the presentdiscussion has been limited to the activities of union members, it is notnecessary to address subs (m), to whichKenny J referred, as it relates tothe activities of officers, rather than members, of unions.

143Sections 298L(1)(f) and (g) prohibit certain conduct by an employerengaged in because a union member has sought an order fora secret ballot ofmembers to be held at a workplace in relation to the taking of industrialaction, or has participated in sucha ballot. The provisions were firstintroduced in 1988 ass 334(1)(c) and (d) of theIndustrial RelationsAct 1988. They were introduced at the same time asss 135 and136 ofthat Act, which provided that union members could apply to the AustralianIndustrial Relations Commission for orders that sucha secret ballot beconducted. Once again, we see the pattern of the amending statute providingfor both the right and its protection. Applying for a secret ballot, orparticipating in such a ballot, will usually arise in the context of anindustrial issue in whicha union is likely to be involved. In that sense thecircumstances are connected with a person's membership of the union so that,ifan employer dismissed an employee because the employee applied for, orparticipated in, such a secret ballot, the dismissal wouldbe properlydescribed as for the reason that the person was a member of the union.

144Section 298L(1)(i) concerns conduct taken against an employee for seekingthe enforcement of an industrial law. A similar provision,but limited toconduct constituted by the dismissal of an employee, was first introduced inthe 1993 Act as s 170DF(1)(e) as follows:

`170DF (1)An employer must not terminate an employee'semployment for any one or more of the following reasons, or for reasonsincludingany one or more of the following reasons:

...

(e)the filing of a complaint, or the participation in proceedings, against anemployer involving alleged violation of laws or regulationsor recourse tocompetent administrative authorities;'

145The section was included in Division 3 which relates to termination ofemployment. As noted above, one object of Division 3 wasto give effectto theTermination of Employment Convention (see schedule 10 of theAct). Section 170DF(1)(e) adopted the wording of article 5(c) of theTermination of Employment Convention and was part of a group of sectionsdesigned to reflect the rights recognised by that Convention. To the extentthat s 170DF(1)(e)encompasses resort by union members to industrial laws,or by unions on behalf of members, it duplicates part of the subject matterats 298L(1)(a).

146In the 1996 amendments, the terms of s 170DF(1)(e) were re-enacted inthe 1996 Act as s 170CK(2)(e), and s 298L(1)(i) was introduced. Thereason for the introduction of s 298L(l)(i) is not explained by theparliamentary materials. It duplicates the essence of muchofs 170CK(2)(e) in relation to the dismissal of an employee. The newprovision, however, extends the protection from terminationto also include theother conduct referred to in s 298K(1)(b) - (e). Given the similarity ofthe subject matter of s 298L(1)(i)and s 170CK(2)(e), it isreasonable to conclude that s 298L(1)(i) also originated from the samesource, namely, theTermination of Employment Convention. In thisrespect, s 298L(1)(i) differed from the other subsections ofs 298L(1). The distinct source of s 298L(1)(i) explains whys 298L(1)(i) was introduced into s 298L, even though it duplicatedpart of s 298L(1)(a). A further reason was that althoughs 298L(1)(a)encompasses the protection referred to in s 298L(1)(i),it is limited in operation to union members whereas the protection referredtoin s 298L(1)(i) applies to all employees. It was a convenient draftingapproach to express s 298L(1)(i) in terms which includedunion members,but went beyond that group.

147Section 298L(1)(n), relevantly, concerns conduct directed against aunion member because that member has engaged in action thatis lawful andauthorised and which is undertaken to further the industrial interests of theunion. The predecessor of this sectionwas first introduced in 1973 ass 5(1)(f) of theConciliation and Arbitration Act 1973 (Cth). Thecontext in which the provision was introduced is evident from the secondreading speech of Mr Clyde Cameron, the Ministerfor Labour. He said:

`The Bill amends section 5 of the Act to provide protection toofficials, or members of unions against discriminatory action withintheemployer's establishment where the official or member has merely upheld theindustrial interests of the employees, so long asthe action he takes is withinthe limits of the authority given to him by the organisation. The Bill alsoprovides protection fortrade unions and their officials against actions forconspiracy or inducement of breach of contract founded on the events of anindustrialdispute. I want to emphasise, however, that this protection willnot extend to acts which cause death or physical injury to a person,physicaldamage to property or involves defamation, or to threats of such acts.

The provisions protecting union officials from tortuous actions stembasically from the Government's belief that the right to strikeis afundamental right which every employee must have. Actions for tort founded onindustrial disputes represent a direct negationof the right to strike. Astrike by its very nature carries with it the threat that the employer willsuffer some material loss. If an employer is to be permitted to recover at lawany loss that he suffers from his employees then the right to strike becomesmeaningless. Workers go on strike whatever the law may have to say about it.That is the clear experience throughout the whole historyof the arbitrationsystem in Australia and our experience is similar to what happens in othercountries such as the United States,England and the other Europeannations.'

(Australia, House of Representatives,Debates, vol HR83, 1973,p 1428.)

148The speech continued by outlining the history of common law proceedingstaken against unions in the United Kingdom, and the thencurrent statutoryimmunity from such liability in the United Kingdom. The Minister further said,at 1429:

`The immunity from actions for tort that was granted to Britishunions by the House of Commons in 1906, is now extended by this Billtoofficials and members of the Australian trade unions.'

149Thus, again, the amendment of s 5(1) was made as part of a moregeneral policy, namely, to protect union members from liabilityfor takingindustrial action. It was useful for the Minister, in presenting the entirepackage, to make reference to a special protectionagainst dismissal and otheradverse consequences against employees as a consequence of those employeesengaging in industrial action,although s 298L(1)(a) would have providedprotection in certain cases.

150It follows from the history of s 298L(1) that Parliament intendeds 298L(1)(a) to cover conduct taken against employees becausethey hadtaken action as members of a union, and because a union had taken action as anincident of that employee's membership ofa union. It did not intend to limits 298L(1)(a) by reference to ss 298L(1)(f), (g) (i) and (n). Rather,those subsections duplicated,in part, the provision of s 298L(1)(a) forspecific historical reasons concerning the introduction of each of thosesubsections.

International Law and the Law of other Jurisdictions

Introduction

151The trend away from collective bargaining and towards individual employmentcontracts in labour relations has been a phenomenonin many countries.Advocates for individual employment contracts argue that such contracts promotea more efficient workplace. Itis thus suggested that there is an economicjustification for the change. One aspect of the move towards individualemployment contractsis the reduction or removal of third party intervention inworkplace relations. Proponents of such change argue that a workplacewilloperate more efficiently and flexibly if employers relate directly withemployees, free of the involvement of unions or thesupervision of industrialtribunals. Because the move to individual employment contracts involves theelimination or reduction ofthe role of unions in the negotiation of terms andconditions of employment, arguments have arisen that employers have made themovein order to rid the workplace of union involvement, rather than for theeconomic advantage said to flow from the introduction ofindividual employmentcontracts. These arguments have led to litigation in domestic tribunals andcourts in many countries. Inmost of these countries, the law has providedprotection to employees against discrimination or victimisation because ofunion membership. The litigation has therefore been concerned with whether thechange from collective bargaining to individual employment contractshasinfringed the rights of employees to protection against victimisation ordiscrimination. In Australia, examples of such litigationincludeTelstra,BurnieandAWU v BHP.

152Because the issue of the interrelationship between anti-discrimination lawsand the trend towards individual contracts in labourrelations has been soprominent in labour jurisprudence in recent times, it is important thatAustralian courts have regard to theviews expressed in other countries.

153The litigation in the United Kingdom is particularly instructive forpresent purposes. The cases there demonstrate a wide divergenceof judicialopinion concerning the scope of protection against discrimination andvictimisation because of union membership. Itis useful to set out these viewsin order to inform the arguments in the present case. The issues consideredare sufficiently similarto the issues arising under s 298L(1)(a) to makethis a worthwhile exercise. But, in the end, the primary value of reference tothe United Kingdom litigation is to be found in its final chapter. Thisoccurred in July 2002 when the European Court of Human Rights(European Court)determined that the United Kingdom law, as determined by the House of Lords,did not conform with article 11 oftheEuropean Convention for theProtection of Human Rights and Fundamental Freedoms(4 November 1950,Rome,213 UNTS 221) (European Convention). The Court held that theprotection accorded by article 11 extended beyond conduct directed againstan employee because the employeeheld a union ticket. It extended to aprohibition of conduct directed against an employee because of the activitiesof a union asan incident of the employee's membership of the union. Thedecision of the European Court bears upon the current issue as a resultofAustralia's international law obligations and the impact of those obligationson domestic law. This matter will be addressedimmediately. Then, the UnitedKingdom litigation and the decision of the European Court will be examined.Finally, reference willbe made to some Canadian jurisprudence relating to theissue.

Australia's obligations under international law.

154The role of international law in the interpretation of Australian statuteswas dealt with inMinister for Immigration and Ethnic Affairs v Teoh[1995] HCA 20;(1994-1995) 183 CLR 273 (Teoh) by Mason CJ and Deane J at 287, asfollows:

`It is accepted that a statute is to be interpreted and applied,as far as its language permits, so that it is in conformity and notin conflictwith the established rules of international law (Polites v TheCommonwealth[1945] HCA 3;(1945) 70 CLR 60 at 68-69, 77, 80-81). The form in which thisprinciple has been expressed might be thought to lend support to the view thattheproposition enunciated in the preceding paragraph should be stated so as torequire the courts to favour a construction, as far asthe language of thelegislation permits, that is in conformity and not in conflict with Australia'sinternational obligations. Thatindeed is how we would regard the propositionas stated in the preceding paragraph. In this context, there are strongreasons forrejecting a narrow conception of ambiguity.If the language ofthe legislation is susceptible of a construction which is consistent with theterms of the international instrumentand the obligations which it imposes onAustralia, then the construction should prevail. So expressed, theprinciple is no more than a canon of construction and does not import the termsof the treaty or convention intoour municipal law as a source of individualrights and obligations (R v Secretary of State for Home Department; Exparte Brind[1991] UKHL 4;[1991] 1 AC 696 at 748).'[emphasis added]

155On 28 February 1973, Australia ratifiedILO Convention (No 87)concerning Freedom of Association and Protection of the Right to Organise(9 July 1948, San Francisco,[1974] ATS 3) (Freedom of AssociationConvention) and also theILO Convention (No 98) concerning theApplication of the Principles of the Right to Organise and to BargainCollectively (1 July 1949, Geneva,[1974] ATS 5) (Right to OrganiseConvention).Article 2 of theFreedom of AssociationConvention deals with freedom of association as follows:

`Workers and employers, without distinction whatsoever, shallhave the right to establish and, subject only to the rules of the organisationconcerned, to join organisations of their own choosing without previousauthorisation.'

156Article 11 of theFreedom of Association Convention deals withthe right to organise as follows:

`Each Member of the International Labour Organisation for whichthis Convention is in force undertakes to take all necessary and appropriatemeasures to ensure that workers and employers may exercise freely the right toorganise.'

157Article 1 of theRight to Organise Conventionrelevantlyprovides:

`1.Workers shall enjoy adequate protection against acts ofanti-union discrimination in respect of their employment.

2.Such protection shall apply more particularly in respect of actscalculated to --

...

(b)cause the dismissal of or otherwise prejudice a worker by reason ofunion membership ...'

158Article 22(1) of theInternational Covenant on Civil andPolitical Rights (19 December 1966, New York,[1980] ATS 23)provides:

`Everyone shall have the right to freedom of association withothers, including the right to form and join trade unions for the protectionofhis interests.'

159This instrument came into force for Australia on 13 November 1980. Seealso: Article 8 of theInternational Covenant on Economic, Social andCultural Rights (19 December 1966, New York,[1976] ATS 5) which cameinto force in Australia on 10 March 1976.

160In the case of the Act under consideration, the impact of Australia'sinternational obligations is made explicit by the principalobject, which isset out in s 3 as follows:

`The principal object of this Act is to provide a framework forcooperative workplace relations which promotes the economic prosperityandwelfare of the people of Australia by:

...

(f)ensuring freedom of association, including the rights of employees andemployers to join an organisation or association of theirchoice, or not tojoin an organisation or association; and

...

(k)assisting in giving effect to Australia's international obligations inrelation to labour standards.' [emphasis added]

United Kingdom Litigation.

161Section 23 of theEmployment Protection Consolidation Act 1978(UK) (the UK Act) provided:

`(1)Every employee shall have the right not to have action(short of dismissal) taken against him as an individual by his employerfor thepurpose of - (a) preventing or deterring him from being or seeking to become amember of an independent trade union, or penalisinghim for doing so; or (b)preventing or deterring him from taking part in the activities of anindependent trade union at any appropriatetime, or penalising him for doingso; or (c) compelling him to be or become a member of any trade union or of aparticular tradeunion or of one of a number of particular tradeunions.'

162Section 58 of the UK Act provided:

`(1)The dismissal of an employee by an employer shall beregarded for the purposes of this Part as having been unfair if the reason forit (or, if more than one, the principal reason) was that the employee - (a)was, or proposed to become, a member of an independent trade union, or(b) had taken part, or proposed to take part, in the activities of anindependent trade union at an appropriate time, or (c)was not a member of anytrade union, or of a particular trade union, or of one of a number ofparticular trade unions, or had refusedor proposed to refuse to become orremain a member.'[emphasis added]

163Section 58(1)(a) of the UK Act has parallels with s 298L(1)(a)of the Act. Section 23 of the UK Act is similar to s 298M of theAct. The UK litigation has involved cases brought under both s 23 ands 58 of the UK Act. The UK courts have treated the membershipissuesarising under s 23(1)(a) and s 58(1)(a) of the UK Act in the sameway.

164InDiscount Tobacco & Confectionery Ltd v Armitage[1990] IRLR15 (Armitage), Mrs Armitage was dismissed after she had approached herunion concerning the terms of her employment, and the union wrote a lettertoher employer on her behalf. Mrs Armitage successfully brought a claim unders 58(1)(a) of the UK Act in the Industrial Tribunal. On appeal to theIndustrial Appeals Tribunal, the employers argued that there was a distinctionbetween membership of the union,and an employee using the services of a unionin negotiating the terms of employment. Knox J rejected the distinction, at16, asfollows:

`We find ourselves unconvinced of that distinction. In ourjudgment, the activities of a trade union officer in negotiating andelucidatingterms of employment is, to use a prayer book expression, theoutward and visible manifestation of trade union membership. It isan incidentof union membership which is, if not the primary one, at any rate, a veryimportant one andwe see no genuine distinction between membership of aunion on the one hand, and making use of the essential services of a union,onthe other.

Were it not so, the scope of section 58. (1)(a) would be reduced almost tovanishing point, since it would only be just the fact thata person was amember of a union, without regard to the consequences of that membership, thatwould be the subject matter of thatstatutory provision and, it seems to us,that to construe that paragraph so narrowly would really be to emasculate theprovisionaltogether.'[emphasis added]

165In 1994, the Court of Appeal heard two appeals together, namely,Associated British Ports v Palmer and OthersandAssociatedNewspapers Ltd v Wilson[1994] ICR 97 (PalmerandWilson).Both appeals arose under s 23(1)(a) of the UK Act.Palmerconcerned workers employed in the port of Southampton. Prior to the events inquestion, the union and the employer had an agreementunder which the employerrecognised the union for the purposes of collective bargaining. That agreementwas incorporated into theindividual employment agreements with each employee.In 1991, the employer offered new employment contracts to manual gradeemployees. Under the new agreements, the employees gave up the "right" tounion representation which they had under the previous contracts. No employeewas compelled to accept the offer. For those who retained the previouscontracts, the union continued to undertakecollective bargaining with theemployer. However, those who signed the new contracts were granted asignificant pay rise. Thispay rise was not offered to those who did not signthe new contracts. Those who signed the new contracts could, however, continueto be members of the union. Dillon LJ (with whom Butler-Sloss and FarquharsonLJJ agreed) said at 101:

`But there is also a question to be considered of what isinvolved in the concept, in section 23 and section 58, of being amemberof an independent union. That comes about because it is clear that thebottom line of the current thinking of employers in thisfield ...is that"membership" means no more than that a person has his name recorded in theunion's register of members and holdsa union membership card, with theconsequence that it is suggested ... that it is a legitimate standpoint for anemployer to sayto an employee: "We have no objection to your being amember of a union, so long as you keep your membership card in your pocketunused and do notseek to make any use of your membership which could have anyimpact on us or our business."'[emphasis added]

166His Lordship then referred toArmitage, set out in the passageextracted at par 166 of these reasons, and concluded that the decision inArmitage was "unquestionably correct". His Lordship then addressed anargument based on a suggested distinction between the reason for theaction,and the means adopted to achieve the objective or the intermediate orcollateral results, which might be caused in achievingit. He said at102-3:

`To my mind that distinction sought to be drawn is in manyrespects unreal, and that is illustrated by the difference in approachinrelation to the alleged purpose between the employers in the present case andthe employers inAssociated Newspapers Ltd v Wilson, post, p. 105G. Itwas said in evidence for the employers in the present case that their purposein offering the personal contractsand the conditional pay rise was "to putinto the hands of management the opportunity to discriminate in terms of pay infavour ofthose who are outstandingly dedicated." As a means towards that end,or an intermediate result, they sought to ensure they did nothave to negotiateover pay and conditions with a union representative. They looked on the unionas a hurdle and their purpose inconferring benefits on those who acceptedpersonal contracts was said to be not to deter or penalise those who did notaccept suchcontracts but to benefit the employers to the extent that theycould conduct their business more efficiently if they did not havethe need toindulge in what they saw to be the time-consuming task of negotiating withunion officials. By contrast, inAssociated Newspaper Ltd v Wilson itwas said for the employers that their purpose in offering a pay rise to thoseemployees who entered into personal contracts ofemployment by a certain datewas to end collective bargaining with unions over pay and conditions of work.No doubt they had a reasonfor wanting to end collective bargaining, but theydid not put forward that reason as being their "purpose" in relation to section23.'

167Dillon LJ addressed the employer's fall back position, at 104-5, asfollows:

`Mr Elias[counsel for the employer] was reluctant toaccept that being a member of an independent union meant no more, in sections23 and 58, than being registered asa member in the books or the union andhaving a member's card. No doubt he realised that it could be regarded asunreal to supposethat those sections were only intended to protect the unioncard divorced from all incidents of membership or rights of the member. Hetherefore accepted that as a fallback position only, but he urged on us that asrecognition of a union by an employer was voluntary,and there were unionmembers employed by employers who did not recognise any union, the incidents ofmembership and rights of a memberof a trade union which sections 23 and 58were intended to protect could at most be the rights of the member as betweenhimself andthe union.

He submitted that where an employee was a member of a union there were threeseparate bilateral relationships, that is to say, (1)between the employee andthe union, (2) between the employee and the employer and (3) between theemployer and the union. He saidthat the rights of the employee as a member ofthe union and the incidents of his membership were concerned exclusively withthefirst.Put shortly, he said that the concept of membership of a tradeunion involves only an employee's relationship with the trade union. It doesnot extend to the trade union's relationship with the employer and it isprotected only as part of the individual's rightto freedom of association.That, in my judgment, is too narrow an analysis, at any rate where, as here, atthe relevant time theemployer recognised the union for the purposes ofcollective bargaining on behalf of the employee.

Beyond that, however, even if the employer has never recognised any unionand is not bound to negotiate with the union or to negotiatewith the employeethrough the union, the employer may invite trouble if the employer chooses totake action to dismiss or penalisethe employee for getting the union toendeavour to negotiate with the employer, or to take some other step with theemployer in relationto the employee's employment. In such a case the employerwill run the risk, in the light of theArmitage case[1990] I.R.L.R. 15,that an industrial tribunal will hold that the action in question was taken bythe employer because the employee was a member ofa union.'

[emphasis added]

168The appeal inPalmerwas allowed.

169The appeal inWilson related to the employment of journalists by TheDaily Mail. Prior to 1989, the employer had negotiated the terms andconditionsof employment collectively with the union. In 1989, it decided nolonger to recognise the union and to deal with its employees directlyon anindividual basis. It therefore offered individual employment contracts to itsemployees. The new contracts provided for a4.5% wage increase. The increasewas not offered to those who refused to sign individual contracts. Thede-recognition of the unionwas not directed to individual employees, andhence, could not amount to a breach of s 23(1)(a) of the UK Act. Theoffer of a payincrease was directed to individuals. The Court of Appeal heldthat it was open to the industrial tribunal to find on the evidence(as on theproper construction of its reasons, the industrial tribunal had found) that theemployer had offered the 4.5% wage increaseas part of an overall action, whichincluded the de-recognition, to eliminate the power of the union, and therebyrender membershippointless. The industrial tribunal had, therefore, rightlyfound that the employer had acted in breach of s 23(1)(a).

170Palmerand Wilson were then appealed to the House of Lords(Associated Newspapers Ltd v Wilsonand Associated British Parts vPalmer and Others[1995] UKHL 2;[1995] 2 AC 454) and the appeals were allowed. Theemployers argued a new point of statutory construction on the appeals. Theycontended that thedenial of the pay rise to the employees was an omission toact and, hence, did not amount to the taking of action within the meaningofs 23(1)(a). This argument was accepted by Lord Bridge, with whom LordsKeith and Lord Browne-Wilkinson agreed. The statutoryconstruction point wastheir primary basis for allowing the appeals. Lord Lloyd and Lord Slynndisagreed with the majority viewon that construction point.

171On the question of the employer's purpose, Lord Lloyd and Lord Slynnallowed the appeals on the primary basis that the necessarypurpose of theemployers had not been established. Lord Bridge and Lord Keith regarded thisas a secondary basis for allowing theappeals. Lord Browne-Wilkinson doubtedwhether the appeals should be allowed on this basis.

172Lord Lloyd dealt with the question in some detail. His view was directlyadopted by Lord Bridge, and indirectly adopted byLord Keith (who expresslyagreed with Lord Bridge).

173In relation toWilson, Lord Lloyd analysed the reasons of theIndustrial Tribunal and held that it made no relevant finding as to the purposeof the payrise, as distinct from the purpose of de-recognition of the union.He then determined that there was no evidence of the necessarypurpose inrelation to withholding the pay rise from employees who did not sign the newcontracts. His Lordship said at 484:

`The only evidence as to the employers' purpose in withholdingthe 4.5 per cent came from the group managing director, Mr Hardy. He said thathe wanted as many members as possible to sign up so that everybody should knowwhere they were. Over and over againhe was asked in cross-examination whetherit was not also a disguised attack on membership of the union. Over and overagain hereplied that it was not. He was not concerned with membership of theunion; he was concerned only to get rid of collectivebargaining.'

174He later said at 484-5:

`... the Court of Appeal was much influenced by the observationsof Knox J inDiscount Tobacco & Confectionery Ltd v Armitage[1995]I.C.R. 431, a decision which the court regarded as unquestionably correct. Itmay well have been correct on its facts. Having rejected theevidence given byMrs Armitage's employers, the tribunal was entitled to infer that the realreason for her dismissal was that shewas a member of the union and made use ofthe union's services to press her complaint. But, like Lord Bridge of Harwich,I cannotregard the case as authority for the broad proposition that membershipof the union and making use of the union's services are insome way to beequated. In my view, section 23(1)(a) was intended to protect trade unionmembership as such, that is to say, theright to associate as members of anindependent trade union, just as section 23(1)(b) was intended to protect thosetaking part intrade union activities at an appropriate time. I can see nojustification for reading in the words `or making use of the essentialservicesof the union' in section 23(1)(a) and still less justification for regardingtrade union membership and the use of tradeunion services as being the samething. They do not mean the same thing in section 23(1)(c). So why shouldthey mean the same thingin section 23(1)(a)? I do not accept Knox J.'s view,at p. 16, that this would reduce section 23(1)(a) to vanishing point.Unionsmay flourish even though they are not recognised for collectivebargaining. In so far as the industrial tribunal relied on the broadstatementin theArmitage case in reaching their "robust" conclusion in paragraph62 (see per Dillon L.J., at p. 110), they erred in law.

For the above reasons, which are substantially the same as those given bythe majority of the Employment Appeal Tribunal[1992] I.C.R. 681, I would allowthis appeal. It was for the employers under section 25(1) of the Act to showthe purpose for which they took actionagainst the applicant. This they did.There was no evidence on which the tribunal could find that the purpose was todeter the applicantfrom remaining a member of the union. Accordingly, theapplicant has failed to show that he has a remedy under section23(1)(a).'

175In relation toPalmer, the employer argued that the purpose ofoffering a pay rise to those who signed new contracts was to achieveflexibility wherebyindividual merit could be rewarded. The fact that the payrise might persuade employees to abandon union representation was onlya meansto that end. Lord Lloyd said at 486-7:

`In the context of this case the distinction between means andends is narrow and somewhat artificial. In my view, the industrialtribunalwere entitled to hold that the true purpose of paying the extra to those whosigned the new contracts was to persuade asmany employees as possible toabandon union representation in wage negotiations.

But where does that lead? Union representation is not something to which,as individuals, they were entitled. They have the rightnot to have actiontaken against them for the purpose of deterring them from remaining members ofthe union. But the industrialtribunal made no finding in paragraph 10, orelsewhere, that that was the employers' purpose. Nor would such a conclusionhave beenjustified on the evidence. The power and the influence of the unionmight well be diminished if enough members opted for individualcontracts.Membership of the union might thus become less attractive. Ms. Dean speaks ofthe union "wither[ing] on the vine:" seep. 110. But it is Parliament, notthe employers, that has, in this respect, made membership of the union lessattractive by repealingsections 11 to 16 of the Act of 1975.

The language of section 23(1)(a) must clearly bear the same meaning now asit did when it was first enacted as section 53 of the Actof 1975. It did notchange its meaning when sections 11 to 16 of the Act were repealed. Theapplicants cannot, by giving section23(1)(a) a meaning much wider than itsterms justify, seek to restore rights which the unions thereby lost. In thecourse of givingthe judgment of the Employment Appeal Tribunal Wood J. said,at p. 113:

"Prior to the repeal of sections 11 to 16 of the Employment Protection Act 1975by section 19(b) of the Employment Act 1980, a tradeunion had rights againstan employer and therefore in order to ensure that an employer negotiate with atrade union there was noneed for an employee to have rights additional to thatof membership. It seems to us therefore that the legislature could not haveintended that the words of section 23(1)(a), which derive from section 53 ofthe Act of 1975, should include those additional rightsby implication in thephrase `being a member'. There is no phraseology which refers to theexercising of rights of membership andin any event such rights would existbetween members and not with reference to a third party - the employer."

I agree with the reasoning. In so far as it conflicts with the broadproposition stated by Knox J in the Armitage case, I preferthe reasons of theEmployment Appeal Tribunal in the instant case. There is no evidence on whichthe tribunal could have found thatthe employers' purpose was to prevent ordeter the applicants from remaining members of the union.'

176The way in which Lord Lloyd approached the scope of the protectionafforded to union membership was thus governed by the statutoryhistory. Whens 23(1)(a) was introduced there was already statutory recognition of thefunction of the union in collective bargaining. Consequently, it was notlikely that the same function was also protected by s 23(1)(a).

177Lord Bridge also referred to the statutory history, at 476, as follows:

`Sections 11 to 16 of the Act of 1975 embodied a complexstatutory code, the details of which do not now matter, which enabled a tradeunion to obtain `recognition' by an employer for the purpose of collectivebargaining with him on behalf of its members. But theseprovisions wererepealed by the Employment Act 1980 and since then an employer has been atliberty to decide for himself whetheror not to enter into or to continue inforce an agreement with a trade union providing for collectivebargaining.'

178He then described his analysis of the circumstances of each appeal at476 as follows:

`Whatever the purpose of A.N.[Associated Newspapers]mayhave been, having given notice to terminate their house agreement with theN.U.J.[National Union of Journalists], in offering an inducement toemployees to sign individual contracts before the notice expired, the onlywitness called by the employersbefore the industrial tribunal gave evidencethat the management had no intention of deterring their employees fromcontinuing asmembers of the N.U.J.; the industrial tribunal's decision doesnot indicate that they rejected this evidence and in fact the majorityof theemployees have continued to be members of the N.U.J. ever since.

InAssociated British Ports v Palmer it was plain that the employerswere seeking by means of an attractive offer to induce their employeesvoluntarily to quit the union'scollective bargaining umbrella and to deal infuture directly with the employers over their terms and conditions ofemployment, butI can see nothing in the evidence recited in the industrialtribunal's decision to suggest that the employers were seeking to inducetheemployees to give up their union membership.'

179This analysis then raised the correctness of the reliance by theIndustrial Tribunal on the proposition it regarded as establishedinArmitage, namely, that there is no genuine distinction betweenmembership of a union and making use of the essential services offered by aunion, such as representation. His Lordship said at 478:

`I do not question the correctness of the Employment AppealTribunal's decision in theArmitage case. Once the industrial tribunalhad rejected the employers' evidence as to their reason for Mrs. Armitage'sdismissal, it wasan obvious inference that she had been dismissed because theemployers resented the fact that she had invited the union to interveneon herbehalf. In this narrow context the reasoning of Knox J. may have been alegitimate means of refuting a particular argumentadvanced by counsel for theemployers. But if the passage cited is held to establish as a generalproposition of law that, in thecontext of section 23(1)(a) and section58(1)(a) of the Act of 1978 membership of a union is to be equated with usingthe `essential'services of that union, at best it puts an unnecessary andimprecise gloss on the statutory language, at worst it is liable to distortthemeaning of these provisions which protect union membership as such.

A union which has a collective bargaining agreement with employers is in aposition to offer its members the service of negotiatingtheir terms andconditions of employment. A union which has no such agreement with employersis unable to offer its members thatservice, but is able to offer them otherimportant and valuable services. Thus, it cannot be said that the service ofcollectivebargaining is an essential union service or that membership of aunion unable to offer that service is valueless or insignificant. Accordingly,it seems to me that the reasoning of Knox J. in theArmitage case couldnot properly be applied to the circumstances of the two cases with which we areconcerned. Even if the construction puton section 23(1)(a) by the majority inNational Coal Board v Ridgway[1987] I.C.R. 641 were correct, I do notthink that in either of these cases the withholding by the employers fromemployees who did not sign individualcontracts of the benefits conferred onthose who did was by itself capable of supporting a finding that the employers'purpose wasto deter those in the latter group from being members of a union orto penalise them for being such members.'

180His Lordship did not purport to consider the issue "in any detail". Hewas concerned that if union membership was read to meanmore than holding aunion card, a gloss would be placed on the language of the section. This glosswas "unnecessary and imprecise". However, to conclude that the construction isunnecessary is to make an assumption about the activities of the union forwhich membersshould have statutory protection. It seems to involve a valuejudgment unsupported by reference to the provisions of the statute. It is avalue judgment which is, at least, contestable.

181In South Africa, for instance, the Constitution provides, ats 23(5):

`Every trade union, employers' organisation and employer has theright to engage in collective bargaining.'

182This section provides constitutional protection of a right of a union inSouth Africa to engage in collective bargaining. Byso providing suchprotection, the South African legal system recognises that collectivebargaining is a central function of unions.

183On the question of imprecision, it should be noted that inArmitageKnox J described the relevant services provided by the union variously, and atone point as a "very important" incident of unionmembership. The approachadopted by Knox J was a fairly fluid and flexible approach, which was likely tobe workable in a practicalsense. By selecting for consideration only theconcept of "essential services" Lord Bridge did not rule on the more workabledescriptionsused by Knox J.

184Lord Slynn dealt first withWilson. The reasons of the industrialtribunal showed that the purpose of de-recognising the union was to deterjournalists from beingunion members. But as this was not directed tojournalists as individuals, it could not amount to a breach of s 23(1)(a).The onlyconduct which could attract the section was withholding the 4.5 percent pay increase. His Lordship said at 481:

`In my opinion withholding an increase of salary from those whoremain members of the union could amount to action forbidden by thissubsectionif the relevant purpose is established. In the present case at the end of theday I am not satisfied that it was so established. The aim of thederecognition was to ensure that contracts could be negotiated individually;that was achieved independently of andprior to the acceptance of the terms ofthe new contract and prior to the date when the appellants failed to pay the4.5 per centincrease to those who did not sign. Collective bargaining came toan end whether all or none of the journalists signed new contracts. Theemployers' case was that they required new contracts so as to make it clearwhat was the position after collective bargainingcame to an end. Such ajustification or "purpose" may, as Mr Hendy submitted, have to be looked atcritically if the consequenceis likely to be a reduction in union membershipbut in this case I do not think that one should disregard the provision of thecontractthat journalists could belong to a union or the fact that manycontinued to do so. I do not consider that there was here evidencethat theemployers' purpose in paying a salary differential was to prevent or deterunion membership even if derecognition in itselfmight make the union lessattractive to members or to potential members.'

185As to the appeal inPalmer, Lord Slynn said at 482-3:

`In this case, too, employees retained the right to membershipof a trade union and the majority of those who accepted personal contractsremained members of the union. Those who accepted the personal contract,however, lost the right to representation by a trade unionin their dealingswith the employers. The distinction between this case andAssociatedNewspapers Ltd v Wilson is that here there was no total derecognition of theunion for collective bargaining purposes but employees were given a choice asto whether they retained or gave up their representation.

Like Dillon L.J., in the Court of Appeal[1994] I.C.R. 97 I do notconsider that action "preventing or deterring" someone from being a member of atrade union or penalising him for doingso is limited to action taken inrespect of his status as a member - the fact that he has or wants to have aunion membership card.It may include action to prevent or deterhim from, or action penalising him for, exercising his rights as a member of atrade union. The exercise of such rights is not necessarily included in thephrase `taking part in the activities' of a trade union, words moreapt tocover such activities as attending union meetings or acting as an official ofthe union.

In the present case, however, the right to be represented in collectivebargaining by the union was a right granted contractuallyby the employerswhich could be terminated on notice. Ceasing to recognise the union was not anaction taken to prevent or deterthe employees from exercising their rights asmembers of the trade union. The fact that inAssociated British Ports v.Palmer, unlikeAssociated Newspapers Ltd. v. Wilson, the workers hadthe option whether to go on being represented by the union or to accept apersonal contract did not mean that thosewho accepted a personal contract werebeing prevented or deterred from exercising their union rights or penalised fordoing so.

In any event it does not seem to me that, having accepted that the reasonthat the employers needed flexibility and more efficientconduct of theirbusiness was an honest reason, the tribunal was entitled on the evidence to saythat flexibility was their "objective"rather than their "purpose". Theirpurpose and their objective were to achieve flexibility; and the means toachieve it were byoffering a higher salary for those who were prepared to giveup union representation.'[emphasis added]

186His Lordship took a wider view of the operation of the concept of unionmembership than did Lord Bridge, Lord Keith and Lord Lloyd. In the end,however, he resolved the appeals on a factual basis. Even on his view of themeaning of union membership, in thesecases the purpose established on theevidence was not the purpose of preventing or deterring the employees frombeing members ofthe union.

187Lord Browne-Wilkinson said at 479:

`I prefer to express no view on the membership issue alsodiscussed by my noble and learned friend [Lord Bridge]. As at presentadvised I would not share his view on the issue but it is unnecessary toexpress any concluded view since the decisionof this case does not turn onthat point.'

188The judgment of Lord Lloyd inWilsonwas referred to by the FullCourt inBHP v AWUin the course of an appeal from the interlocutoryorders made by Gray J. The Full Court considered whether there was a seriousissueto be tried that the employer had induced employees to stop being membersof the union in breach of s 298M of the Act. The Courtreferred to LordLloyd's distinction between a concern with membership of the union on the onehand, and a concern to get rid ofcollective bargaining on the other. The FullCourt also referred to his view that the difference between means and ends isnarrowand artificial. The passages referred to by the Full Court arecontained within the extracts set out in pars 173 and 174 of thesereasons.

189The Full Court also referred for assistance to the following passages fromthe United States case ofAmerican Ship Building v Labour Board[1965] USSC 53;380 US300 (1965). The United States legislation required consideration of themotivation of the employer in its conduct towards union members,but the Courtregarded the concept of union membership as involving more than the employeeholding a union ticket. At pars 73 -75 the Full Court said:

`[73]InAmerican Ship Building v Labor Board, Stewart J,delivering the opinion of the Court, said (at 311):

"Section 8(a)(3) prohibits discrimination in regard to tenure or otherconditions of employment to discourage union membership. Under the words ofthe statute there must be both discrimination and a resulting discouragement ofunion membership. It has longbeen established that a finding of violationunder this section will normally turn on the employer's motivation ... Thuswhen theemployer discharges a union leader who has broken shop rules, theproblem posed is to determine whether the employer has acted purelyindisinterested defense of shop discipline or has sought to damage employeeorganization. It is likely that the discharge willnaturally tend todiscourage union membership in both cases, because of the loss of unionleadership and the employees' suspicionof the employer's true intention. Butwe have consistently construed the section to leave unscathed a wide range ofemployer actionstaken to serve legitimate business interests in somesignificant fashion, even though the act committed may tend to discourage unionmembership ... Such a construction of § 8(a)(3) is essential if dueprotection is to be accorded the employer's right to managehis enterprise."

[74]Stewart J went on the say (at 311 - 312):

"This is not to deny that there are some practices which are inherently soprejudicial to union interests and so devoid of significanteconomicjustification that no specific evidence of intent to discourage unionmembership or other antiunion animus is required. In some cases, it may bethat the employer's conduct carries with it an inference of unlawful intentionso compelling that it isjustifiable to disbelieve the employer's protestationsof innocent purpose."

[75]Stewart J added (at 313), the following:

"There was not the slightest evidence and there was no finding that theemployer was actuated by a desire to discourage membershipin the union asdistinguished from a desire to affect the outcome of the particularnegotiations in which it was involved. We recognizethat the `unionmembership' which is not to be discouraged refers to more than the payment ofdues and that measures taken to discourageparticipation in protected unionactivities may be found to come within the proscription. Radio Officers' Unionv. Labor Board,[1954] USSC 9;(1954) 347 US 17, at 39-40. However, there is nothing inthe Act which gives employees the right to insist on their contract demands,free from thesort of economic disadvantage which frequently attends bargainingdisputes. Therefore, we conclude that where the intention provenis merely tobring about a settlement of a labor dispute on favourable terms, no violationof § 8(a)(3) is shown."'

[emphasis added]

190The Full Court concluded:

`[76]The stance taken to comparable legislation in England andthe United States can illuminate our approach to the meaning of s298M.By this approach, the essential question, one of fact, is the appropriatecharacterisation of the conduct of BHPIO, viewed,however, in its full context.We agree with Lord Lloyd that, in this connection, the distinction betweenmeans and ends may be toonarrow and artificial. Although it is accepted bythe respondent that no explicit relevant threat or promise was made, it isplainthat the operation of s 298M is not so limited; that is, theinducing conduct may take another form - that is, "otherwise", as thewords inparenthesis state.'

191The Full Court did not make a choice between what appear to beconflicting approaches to the concept of union membership. Rather,the FullCourt saw the question in that case as one of fact, namely, thecharacterisation of the conduct of the employer. The focusof attention, andthe matter to which this conclusion was directed was whether it was arguablethat the conduct in question amountedto inducement under s 298M. Thus,the judgment does not advance the question of the meaning of the concept ofunion membership forthe purposes of the present case. In any event, theappeal was determined before the European Court delivered its judgment in theWilsonandPalmer matters.

The European Court of Human Rights.

192TheWilsonandPalmer appeals had a sequel in the EuropeanCourt,Case of Wilson & the National Union of Journalists, Palmer, Wyeth& the National Union of Rail, Maritime & Transport Workers; Doolan& others v. the United Kingdom(unreported, Eur Ct HR, applicationnos 30668/96, 30671/96 and 30678/96, Strasbourg, 2 July 2002). In thisforum, the case concernedthe interpretation of article 11 of theEuropeanConventionwhich provided:.

`Everyone has the right to freedom of peaceful assembly and tofreedom of association with others, including the right to form andto jointrade union for the protection of his interests.'

193It will be recalled that this article mirrors the terms ofarticle 22 of theInternational Covenant on Civil and Political Rightsto which Australia is a party.

194The European Court described the applicants' arguments, at par 40, asfollows:

`The applicants submitted that the right to union membership"for the protection of his interests" under Article 11 necessarily involvedtherights of every employee (1) to be represented by his or her union innegotiations with the employer, and (2) not to be discriminatedagainst forchoosing to avail him- or herself of the right to be represented. In thisconnection, the applicants referred to thefindings and recommendations of theCommittee of Experts under the European Social Charter and of the ILO'sCommittee on Freedomof Association (see paragraphs 32-33 and 37 above),that the right of union representation is inherent in the right of unionmembership(as provided for in Article 5 of the Charter and in the ILOConvention).'

[emphasis added]

The European Court then referred to the judgment of the House of Lords, atpar 40, as follows:

`However, the House of Lords' judgment made it plain thatdomestic law protected only the right of union membershipper se, andnot any of the incidents of membership, such as collective representation incontract negotiations. Unless it could be shownthat an employer acted withthe intention to prevent, deter or penalise membership (per se) of aunion, there was nothing to prevent the employer discriminating against anemployee who chose to take advantage of one of theincidents of membership,such as collective representation.'

195The European Court decided, at par 46 - 48, as follows:

`46....[I]t is of the essence of the right to join atrade union for the protection of their interests that employees should be freeto instructor permit the union to make representations to their employer or totake action in support of their interests on their behalf. Ifworkers areprevented from so doing, their freedom to belong to a trade union, for theprotection of their interests, becomes illusory. It is the role ofthe State to ensure that trade union members are not prevented or restrainedfrom using their union to representthem in attempts to regulate theirrelations with their employers.

47.In the present case, it was open to the employers to seek to pre-emptany protest on the part of the union or their member againstthe imposition oflimits on voluntary collective bargaining, by offering those employees whoacquiesced in the termination of collectivebargaining substantial pay rises,which were not provided to those who refused to sign contracts accepting theend of union representation. The corollary of this was that United Kingdom lawpermitted employers to treat less favourably employees who were not prepared torenounce a freedom that was an essential feature of union membership. Suchconduct constituted a disincentive or restraint on theuse by employees ofunion membership to protect their interests. However, as the House of Lords'judgment made clear, domestic lawdid not prohibit the employer from offeringan inducement to employees who relinquished the right to union representation,even ifthe aim and outcome of the exercise was to bring an end to collectivebargaining and thus substantially to reduce the authority ofthe union, as longas the employer did not act with the purpose of preventing or deterring theindividual employee simply from beinga member of a trade union.

48.Under United Kingdom law at the relevant time it was, therefore,possible for an employer effectively to undermine or frustratea trade union'sability to strive for the protection of its members' interests. The Courtnotes that this aspect of domestic lawhas been the subject of criticism bySocial Charter's Committee of Independent Experts and the ILO's Committee onFreedom of Association(see paragraphs 32-33 and 37 above). It considers that,by permitting employers to use financial incentives to induce employeestosurrender important union rights, the respondent State failed in its positiveobligation to secure the enjoyment of the rightsunder Article 11 of theConvention. This failure amounted to a violation of Article 11, as regardsboth the applicant unions andthe individual applicants.'[emphasisadded]

196It follows from this decision that the right to join a trade unionprovided for by theEuropean Conventionembraces a right to have a unionrepresent and take action in support of the interests of the particular member.In an article analysingthe effect of the decision, Professor Ewing said:

`The third important feature of the case is the holding thatalthough Article 11 does not encompass collective bargaining, neverthelessitis of the essence of the right to join trade unions for the protection of theirinterests that employees "should be free to instructor permit the uniontomake representations to their employ or to take action in support of theirinterests on their behalf". But not only that: it is said to be "the roleofthe State to ensure that trade union members are not prevented or restrainedfrom using theirunionto represent them in attempts to regulate theirrelations with their employer". Note the two dimensions: not just theright to have the union make representations (the weaker dimension), buta right to be represented by the union in regulating relations with theemployers(the strong dimension). The corollary of this positive right oftwo dimensions is that workers should not be penalised where theyexercisetheir right to be represented by a trade union.'

Ewing KD,`The implications of Wilson and Palmer', Industrial LawJournal,vol 32, No. 1, March 2003, pp 6-7.

197In Australian law, the right to join a union without attracting adverseconsequences is conferred by s 298L(1)(a). This sectionshould beconstrued conformably with Australia's international obligations under theFreedom of Association Convention, theInternational Covenant onCivil and Political Rightsand theInternational Covenant on Economic,Social and Cultural Rights. Those obligations extend to protecting unionmembers from discrimination based on the actions taken by a union as anincident ofthe membership of the person of the union.

Canada

198The Supreme Court of Canada has also given helpful consideration to theinterrelationship between the freedom of associationand the right to join aunion. TheCanadian Charter of Rights and Freedomss 2(d) (theCharter) guarantees freedom of association as a `Fundamental Freedom'.In Alberta, legislation was passed which prohibited strikes and imposedcompulsory arbitration to resolve impasses in collective bargaining in relationto the employment of public servants, fire fighters,hospital employees andpolice officers. The Supreme Court of Canada inReference Re Public ServiceEmployee Relations Act (Alta.)[1987] 1 SCR 313 had to determine whetherthe legislation violated theCharterguarantee of freedom ofassociation. Dickson CJ with whom Wilson J agreed, held that the legislationdid violate the guarantee offreedom of association. The majority (Beetz,McIntyre, Le Dain and La Forest JJ) held that it did not. The Chief Justiceexplainedone issue, at 335-336, thus:

`Second, what approach is taken to the nature of freedom ofassociation? More specifically, has the relevant tribunal adopted whatI shallrefer to as a "constitutive" definition of freedom of association wherebyfreedom of association entails simply the freedomto combine together but doesnot extend to the freedom to engage in the activities for which the associationwas formed? Alternatively,has a wider definition been adopted to the effectthat freedom of association embodies both the freedom to join togetherand the freedom to pursue collective activities? In thisappeal, the respondent adopts the former view while the appellants adopt thelatter.'

199His Honour then explained the division of opinion on the question inCanadian case law at 338-339 as follows:

`Canadian jurisprudence on the nature and scope of freedom ofassociation is divided. On the one hand, the British Columbia Courtof Appealand the Federal Court of Appeal have endorsed a constitutive definition offreedom of association, concluding that collectivebargaining and strikeactivity are not protected by freedom of association. ... On the other hand,the Ontario Divisional Court,and the Saskatchewan Court of Appeal have adoptedbroader definitions, holding that freedom of association includes the freedomtopursue common purposes and to engage in collective activities, and is notmerely the freedom to form and join associations.'

200His Honour, at 339-340, referred to a passage in the judgment of MahoneyJ (with whom Hugessen J concurred) inPublic Service Alliance of Canada vThe Queen[1984] 2 FC 889, 895 as representative of the narrow view. Thatpassage reads as follows:

`The right of freedom of association guaranteed by the Charteris the right to enter into consensual arrangements. It protects neithertheobjects of the association nor the means of attaining thoseobjects.

...

I do not think it desirable to attempt to catalogue the rights and immunitiesinherent in a trade union's guaranteed freedom ofassociation. Clearly,collective bargaining is, or should be, the primary means by which organizedlabour expects to attain itsprincipal object: the economic betterment of itsmembership. However fundamental, it remains a means and, as such, the right tobargain collectively is not guaranteed by paragraph 2(d) of the Charter, whichguarantees freedom of association.'

201As representative of the wider view, his Honour, at 341, cited a passagefrom the judgment of Galligan J inRe Service Employees' InternationalUnion, Local 204 and Broadway Manor Nursing Home(1983) 44 OR (2d) 392,409. The passage reads as follows:

`But I think that freedom of association if it is to be ameaningful freedom must include freedom to engage in conduct which isreasonablyconsonant with the lawful objects of an association. And I think alawful object is any object which is not prohibited by law....

The purpose of an association of workers in a union is clear -- it is toadvance their common interests. If they are not free totake such lawful stepsthat they see as reasonable to advance those interests, including bargainingand striking, then as a practicalmatter their association is a barren anduseless thing. I cannot imagine that the Charter was ever intended to guaranteethe freedomof association without also guaranteeing the freedom to do that forwhich the association is intended. I have no hesitation in concludingthat inguaranteeing workers' freedom of association the Charter also guarantees at thevery least their freedom to organize, tochoose their own union, to bargain andto strike.'

202His Honour then reviewed the US authorities and summarised the position,under US law, at 347-348 as follows:

`In summary, my understanding of the United States authoritieson freedom of association and its application in the context of labourrelations is this: Freedom of association is implicitly guaranteed by the FirstAmendment and protects the concerted pursuit of endswhich are explicitlyprotected by the First Amendment, namely speech, assembly and petition; in thetrade union context, the FirstAmendment's freedom of association protects theright to organize and select representatives for collective bargaining; it alsoprotectsthe activities of trade unions in respect of securing legalrepresentation for their members; nevertheless, freedom to strike inthe publicsector is not protected by the implied freedom of association in the FirstAmendment.'

203Next, his Honour turned to international law, at 348, as follows:

`International law provides a fertile source of insight into thenature and scope of the freedom of association of workers. Sincethe close ofthe Second World War, the protection of the fundamental rights and freedoms ofgroups and individuals has become a matterof international concern. A body oftreaties (or conventions) and customary norms now constitutes an internationallaw of humanrights under which the nations of the world have undertaken toadhere to the standards and principles necessary for ensuring freedom,dignityand social justice for their citizens. TheCharter conforms to thespirit of this contemporary international human rights movement, and itincorporates many of the policies and prescriptionsof the variousinternational documents pertaining to human rights. The various sources ofinternational human rights law--declarations,covenants, conventions, judicialand quasi-judicial decisions of international tribunals, customary norms--must,in my opinion, berelevant and persuasive sources for interpretation of theCharter's provisions.'

204The Chief Justice referred to theUniversal Declaration of HumanRightsG/A-Res. 217A (III) UN. Doc. A/810, (10 December 1948), theInternational Covenant on Economic, Social, and Cultural Rights, theInternational Covenant on Civil and Political Rights, and the Freedomof Association Convention. His Honour also referred to interpretations byInternational Labour Organisation bodies, including the Committee on Freedom ofAssociation, the Committee of Experts, and Commissions of Inquiry. Hesummarised the situation, at 358-359, as follows:

`The most salient feature of the human rights documentsdiscussed above in the context of this case is the close relationship in eachof them between the concept of freedom of association and the organization andactivities of labour unions. As a party to thesehuman rights documents,Canada is cognizant of the importance of freedom of association to tradeunionism, and has undertaken asa binding international obligation to protectto some extent the associational freedoms of workers within Canada. Both ofthe U.N.human rights Covenants contain explicit protection of the formationand activities of trade unions subject to reasonable limits. Moreover, thereis a clear consensus amongst the I.L.O. adjudicative bodies that Convention No.87 goes beyond merely protectingthe formation of labour unions and providesprotection of their essential activities -- that is of collective bargainingand thefreedom to strike.'

205With this variety of views in mind, the Chief Justice proceeded to dealwith the meaning of the guarantee of freedom of associationin theCharter. He first rejected the constitutive approach, at 362-363, asfollows:

`A wide variety of alternative interpretations of freedom ofassociation has been advanced in the jurisprudence summarized above andinargument before this Court.

At one extreme is a purely constitutive definition whereby freedom ofassociation entails only a freedom to belong to or form an association. Onthis view, the constitutional guarantee does not extend beyond protecting theindividual'sstatus as a member of an association. Itwould not protect his or her associationalactions.

In the trade union context, then, a constitutive definition would find aprima facie violation of s. 2(d) of theCharter inlegislation such as s. 2(1) of thePolice Officers Act which prohibitsmembership in any organization affiliated with a trade union. But it couldfind no violation of s. 2(d) in respect of legislation which prohibiteda concerted refusal to work. Indeed, a wide variety of trade union activities,rangingfrom the organization of social activities for its members, to theestablishment of union pension plans, to the discussion of collectivebargaining strategy, could be prohibited by the state without infringing s.2(d).

The essentially formal nature of a constitutive approach to freedom ofassociation is equally apparent when one considers other typesof associationalactivity in our society. While the constitutive approach might find a possibleviolation of s. 2(d) in a legislative enactment which prohibitedmarriage for certain classes of people, it would hold inoffensive an enactmentwhichprecluded the same people from engaging in the activities integral to amarriage, such as cohabiting and raising children together. If freedom ofassociation only protects the joining together of persons for common purposes,but not the pursuit of the very activitiesfor which the association wasformed, then the freedom is indeed legalistic, ungenerous, indeedvapid.'

206His Honour then sought to define the interests which the guaranteeprotected. He said, at 363:

`In my view, while it is unquestionable that s. 2(d), ata minimum, guarantees the liberty of persons tobe inassociation or belong to an organization, it must extend beyond a concern forassociational status to give effective protectionto the interests to which theconstitutional guarantee is directed. In this respect, it is important toconsider the purposive approachto constitutional interpretation mandated bythis Court'

207He continued later, at 368:

`The role of association has always been vital as a means ofprotecting the essential needs and interests of working people. Throughouthistory, workers have associated to overcome their vulnerability as individualsto the strength of their employers. The capacityto bargain collectively haslong been recognized as one of the integral and primary functions ofassociations of working people. While trade unions also fulfil other importantsocial, political and charitable functions, collective bargaining remains vitaltothe capacity of individual employees to participate in ensuring fair wages,health and safety protections, and equitable and humaneworkingconditions.'

208His Honour then concluded, at 371:

`Under our existing system of industrial relations, effectiveconstitutional protection of the associational interests of employeesin thecollective bargaining process requires concomitant protection of their freedomto withdraw collectively their services, subjectto s. 1 of theCharter.'

209The Chief Justice, consequently, held that the prohibition on takingstrike action infringed the guarantee of freedom of association.

210McIntyre J came to the opposite conclusion, but also considered whether theguarantee of freedom of association extended tothe activities of a union. Heidentified six possible definitions of the scope of freedom of association.They were as follows,at 399-402:

`... To begin with, it has been said that freedom of associationis limited to a right to associate with others in common pursuitsor forcertain purposes. Neither the objects nor the actions of the group areprotected by freedom of association. ...

...

A second approach provides that freedom of association guarantees thecollective exercise of constitutional rights or, in other words,the freedom toengage collectively in those activities which are constitutionally protectedfor each individual. ...

It will be seen that this approach guarantees not only the right toassociate but as well the right to pursue those objects of associationwhich bytheir nature have constitutional protection.

A third approach postulates that freedom of association stands for theprinciple that an individual is entitled to do in concert withothers thatwhich he may lawfully do alone, and conversely, that individuals andorganizations have no right to do in concert whatis unlawful when doneindividually. ...

A fourth approach would constitutionally protect collective activities whichmay be said to be fundamental to our culture and traditionsand which by commonassent are deserving of protection. ...

A fifth approach rests on the proposition that freedom of association, unders. 2(d) of theCharter, extends constitutional protection to allactivities which are essential to the lawful goals of an association....

The sixth and final approach so far isolated in the cases, and by far themost sweeping, would extend the protection of s. 2(d) of theCharter to all acts done in association, subject only to limitationunder s. l of theCharter.'

211McIntyre J, at 404, rejected the fifth and sixth approaches because, toaccept them:

`would be to accord an independent constitutional status to theaims, purposes, and activities of the association, and thereby confergreaterconstitutional rights upon members of the association than uponnon-members.'

212He accepted the third approach, at 408-409, as follows:

` ... This approach, in my view, is an acceptable interpretationof freedom of association under theCharter. It is clear that, unlikethe fifth and sixth approaches, this definition of freedom of association doesnot provide greater constitutionalrights for groups than for individuals; itsimply ensures that they are treated alike. If the state chooses to prohibiteveryonefrom engaging in an activity and that activity is not protected underthe Constitution, freedom of association will not afford anyprotection togroups engaging in the activity. Freedom of association as an independentright comes into play under this formulationwhen the state has permitted anindividual to engage in an activity and yet forbidden the group from doing so.Moreover, unlike thefourth approach, the inquiry is firmly focussed on thefundamental purpose of freedom of association, namely, to permit the collectivepursuit of common goals. ... Finally, this approach fully realizes the value orpurpose of association. Activities which the statepermits an individual topursue may be pursued in a group. Associations engaged in scientific,educational, recreational, and charitablepursuits would receive protectioneven though these activities or pursuits may not be independently protected bytheCharter, provided these activities are not forbidden at law toindividuals. The objective of guaranteeing the freedom of individuals to unitein organizations of their choice for the pursuit of objects of their choicewould be achieved.'

213He concluded, at 409:

`It follows from this discussion that I interpret freedom ofassociation in s. 2(d) of theCharterto mean thatCharter protection will attach to the exercise in association of suchrights as haveCharter protection when exercised by the individual.Furthermore, freedom of association means the freedom to associate for thepurposesof activities which are lawful when performed alone. But, since thefact of association will not by itself confer additional rightson individuals,the association does not acquire a constitutionally guaranteed freedom to dowhat is unlawful for the individual.'

214It followed from this reasoning that the right to strike was notprotected by the guarantee of freedom of association, becausethe right was notindependently protected under theCharter, and his Honour held that itwas not lawful under Canadian law for workers to refuse to work. The majorityagreed with McIntyreJ as to the result of the case. In a short judgmentthey did not touch on the issue of relevance to the present case.

215The significance of the discussion by Dickson CJ with Wilson J andMcIntyre J is that they all accept that freedom of associationextends beyondfreedom to join a union. The Chief Justice and Wilson J held that collectivebargaining is an essential element offreedom of association and the right tostrike is a concomitant of the function of collective bargaining. McIntyre Jdid not goso far in relation to a right to strike, but accepted that lawfulactions of members when undertaken in association were protectedby theguarantee of freedom of association in theCharter.

Conclusion - The Meaning of Membership

216Thus, where s 298L(1)(a) speaks of conduct carried out because aperson is a member of a union, it encompasses conduct carriedout because ofthe activities of the union as an incident of that person's membership of theunion.

217This meaning is supported by the history and context of the section. It issupported by the Australian decisions inPalmerston, Gilbertson, QenosandElliott.It is consistent with the European Court's recentinterpretation of Article 11 of theEuropean Convention whichmirrors Australia's international obligations under the Freedom of AssociationConvention and theInternational Covenant on Economic, Social and CulturalRights and theInternational Covenant on Civil and Political Rights.And it conforms with the concept of freedom of association in the South AfricanConstitution and with a significant body of judicialopinion in the UnitedKingdom, and Canada in relation to comparable laws.

REASON FOR THE CONDUCT - THE FACTS

218It was found earlier that Belandra had refused to reemploy the Belandraemployees and/or altered the position of those employeesto their prejudice.Based on the discussion as to the scope of the proscribed reason unders 298L(1)(a) above, it is now necessaryto determine whether Belandraacted for a proscribed reason. Belandra's conduct is presumed to have beencarried out for the proscribedreason alleged unless Belandra proves otherwise:s 298V. Further, the alleged reason need only be one reason of a numberof reasonsactuating the conduct. It is not necessary that the prohibitedreason be the sole or dominant reason for the conduct: s 298K(1),Burnieat par 15, andGeraldton at par 224.

219In affidavits sworn on behalf of Belandra, Mr Catalfamo, Mr Cabral, and MrOravec expressly denied that Belandra acted for thereason that the employeeswere members of the applicant, or that the employees were entitled to thebenefit of the 2000 Agreement. Mr Catalfamo described the reasons in hisaffidavit sworn on 4 September 2002, as follows:

`3.Immediately after the fire, I and my fellow directors ofBelandra (and the other businesses at Brooklyn) were traumatised by thefireand its effect upon our business and employees. However, as things settleddown, I started to review the performance of Belandra(along with the otherbusinesses) and its future business direction. I realised that initially, Iand my fellow directors had beenclose to the meat production process and hadbeen intimate with its operations. However, over a period of time, we hadbecome occupiedwith other aspects of the business (such as marketing andproduct development), which meant that we no longer had the productionexpertise we once held. In August / September 2001, I came to the view that weno longer had sufficient expertise to effectivelyoversee a meat productionoperation, and that we should appoint either another person or company to dothis.

4.Several things happened after the fire, which influenced my views.Firstly, shortly after the fire the Commonwealth Bank of Australia("CBA"), thebankers for Belandra (and Belandra Trading and EM Processors), informed us thatthe accounts of those companies werebeing placed into asset management. Atthe time these accounts had several bank facilities and although we wereallowed to operatewithin these facilities and use the reserves built up in theaccounts, the CBA took the following actions:

(a)The payment by the insurance company of $5 million to tide us overwhile the claims were being processed was frozen by the CBA fora number ofweeks;

(b)An approved loan facility of $15 million to purchase SBA waswithdrawn immediately;

(c)Sims Lockwoods were appointed by the CBA (at our cost) to prepare anindependent report on the financial viability of the businesses;

(d)The personal assets of the directors which formed the basis ofguarantees and cross-guarantees for the businesses were also placedinto assetmanagement. For example, any major transactions from my personal account hadto be approved by the CBA.

5.Further, in July 2001, Belandra received a workers' compensation billof $1,549,046 for the 2000-2001 financial year. Belandra couldnot pay thepremium as it fell due and as a result we had to negotiate an extension of timeto pay the premium, which resulted inpenalties and interest. After this, Iand my fellow directors became convinced that unless drastic action was takenby Belandra,it would go broke and cease operations. Ultimately, I and myfellow directors decided that Belandra would not resume operationsas a meatprocessor. Similar decisions were made by the directors of Belandra Tradingand EM Processors in the period August / September2001.

6.In early September 2001, I had a meeting with Doug Shears who is themanaging director of an agricultural company called ICM Pty Ltd. At thatmeeting I explained to him the concerns I had about Belandra and the otherBrooklyn businesses. These concerns included:

(a)the businesses had been crippled after the fire and changes werenecessary if the businesses were to operate again;

(b)the huge increase in WorkCover premiums;

(c)EM Processors had taken over the P & R boning room, which hadbeen poorly managed, and we were trying to make it productive.

7.In my meeting with Mr Shears I explained that I was looking for adifferent strategy for the businesses. Mr Shears helped me to understandthatwith my and Mr Cabral's expertise in the industry, we should look at reducingour involvement in different areas of the businessand making more peopleresponsible for these areas as their own businesses. Mr Shears called it a"virtual business".

8.After this meeting I had further discussions with Mr Cabral regardingthe businesses. We developed a strategy that the only way tosuccessfullymanage the businesses was to develop what I call the `Westfield Model'.Westfield builds shopping centres and providesthe infrastructure of thebuilding and services such as security, power, lighting etc. It then leasesthe space to tenants who areresponsible for running the individual businesses.This allows Westfield to focus on building more shopping centres. In the sameway, if Belandra and the other businesses moved away from the meat processingoperations, it could focus on growing other areas ofthe business it was goodat, such as designing and commissioning new meat processing plants, marketinglivestock procurement andproduct research and development.'

This evidence constituted Mr Catalfamo's evidence in chief on the subject.Mr Cabral's and Mr Oravec's evidence did not add significantlyto the evidenceof Mr Catalfamo on this issue.

220It is not incumbent on Belandra to establish that there were other reasonsfor its conduct. Rather, it has to demonstrate thatthe proscribed reasonswere not an actuating reason for its conduct. However, the existence of acogent alternative explanationfor the conduct might be an indicator that theproscribed reasons did not so actuate the conduct. In any event, Belandraundertook,in this case, to demonstrate alternative reasons for its conduct.The alternative reasons raised by Mr Catalfamo, in his affidavitof 4September 2002 extracted above, were the desire to introduce the Westfieldmodel, and the financial viability of Belandra.

221I am not satisfied, however, that either of the proffered reasons actuatedBelandra's decision to refuse to reemploy the workforce. The case put byBelandra, in essence, rested mainly on assertion where it was reasonable toexpect that some supporting evidencewould have been produced. For instance,to establish the asserted danger of Belandra's insolvency if the workforce wasreemployed,calls for expert analysis of past accounting records andprojections as to future trading outcomes based on assumptions of eithermaintaining or dispensing with the workforce. Instead of taking that course,Belandra relied on the increased costs of workers compensationpremiums as theprimary basis for establishing the danger of insolvency. Mr Cabral referred tothe issue, in his affidavit swornon 4 September 2002, as follows:

`56.In making this decision for Belandra a number of financialfactors were taken into account by the directors. These includedthefollowing:

(a)Increased workers' compensation premiums. Belandra's premium at theBrooklyn site for beef slaughtering for the financial year 2000-2001was$1,549,046, which represented a 493 per cent increase over the previous yearwhen the premium was only $313,997. Now producedand shown to me and marked`PGC-7' and `PGC-8' are copies of the premium advice forms for the years1999/00 and 2000/01. This levelof workers' compensation premiums was severelyundermining the financial viability of Belandra. Similar increases applied totheother companies.

(b)The business of slaughtering and boning had become financiallyunviable because of the total costs involved. The increased workers'compensation premium for Belandra meant it was at risk of being insolvent. Itcould not have continued to operate as it had beforethe fire for muchlonger.'

222The premium advices exhibited to the affidavit clearly showed that theincreased premium was referable in part to a very largeincrease in the payrollon which the premium was calculated. So, in 1999-2000 the premium wascalculated on a payroll of $3,939,049,and in 2000-2001 the premium wascalculated on a payroll of $9,445,412. The matter was taken up with MrCatalfamo in reexamination. He said that there was an additional workerscompensation surcharge of $1.5 million levied on Belandra in July 2001. Hesaid thatthe information came to him from "our finance people". The course ofquestioning was then objected to by counsel for the applicantas it was a newissue arising in reexamination. However, as the issue had been raised by theCourt, counsel for Belandra was invitedby the Court to clarify the situation.Mr Catalfamo repeated the evidence that he had been told of a further surchargeby his financedirector. No further evidence of the surcharge was tendered.Thus, even on the central piece of evidence relied upon to establishthefinancial unviability of Belandra, the best evidence was not called, and thenature, consequences, and circumstances of the surchargewere left in doubt.Even if the evidence of the surcharge had been clear, it alone would not haveestablished that Belandra was infinancial danger.

223For similar reasons, I am not persuaded that the directors of Belandraformulated a different business approach which led themto refuse to reemploythe workforce. Mr Catalfamo's reference to the "Westfield model" was inthe most general terms. In substance,the reference to the model did notprovide a reason for not reemploying the workforce, it simply amounted to analternative way ofstating that Belandra would not do so. To the limitedextent that the witnesses referred to the reasons for adopting the model,thosereasons were not persuasive. For instance, it was said that the directors ofBelandra had too little time to devote to theday to day operations of meatproduction and no longer had the necessary expertise to do so. Yet MrCatalfamo and Mr Cabral satat the apex of an organisational hierarchy. Theevidence showed that even at the Brooklyn site the day to day operations ofmeatproduction were conducted by a team of managers and supervisors. AlthoughMr Cabral seemed to have a daily contact with the productionprocess, MrCatalfamo seems to have been involved only if major questions arose. In anyevent, if a major change in direction inthe business was to be undertaken onewould expect a coherent formulation of the plan and a detailed investigationinto the feasibilityof the change. After all, the business involved wasobviously substantial. Although the financial details of the operation werenot disclosed, the evidence does show that in 2000-2001 the payroll of Belandrawas over $9 million. Mr Catalfamo's analogy withthe Westfield shoppingcentre business was so vague and inexact as to lack any real significance. Incross-examination he was pressedwith the obvious difference between theBelandra business and the Westfield business, namely, that the Belandrabusiness was directedto the supply of goods, whilst Westfield owned andmanaged shopping centres through which goods were supplied by others. In theend he conceded:

`I mean if you take the whole model of Westfield in itsentirety, sure it's different. But I've used Westfield in terms of discussingwhat my thoughts were for the future with union officials.'

224This lack of formulation of the business model suggests that it was asuperficial musing of Mr Catalfamo, which served as a convenientfog to softenthe central reality that Belandra would not reemploy its workforce. To avoidcalling a spade a spade, Mr Catalfamocalled the decision not to reemploy theBelandra employees, the implementation of the Westfield model. It was probablyfor the samereason that, despite a promise made at a meeting on17 September 2001, to Mr Bird, the secretary of the Victorian Branch ofthe applicant,Mr Catalfamo did not commit the Westfield model to paper.

225The next question is whether Belandra has negatived the proscribed reasons.Mr Catalfamo addressed this issue directly in anumber of answers duringcross-examination. These answers are of central importance in determining thisissue. However, they mustbe seen against the background of the industrialsituation at Brooklyn. In his affidavit sworn on 14 August 2002, Mr PaulDavey,the Assistant Secretary of the Victorian Branch of the applicant,stated:

`Since 1996 the Brooklyn abattoir has been one of the mostunsettled in my experience. ... Each of the beef, mutton and EMP operationshadfeatured a high level of ongoing industrial problems, requiring frequent use ofthe grievance and dispute-resolution proceduresin the 1997 and 2000Agreements.'

226The grievance procedure referred to is contained in cl 8 of the2000 Agreement which provides:

`8CONSULTATIVE ARRANGEMENTS

8.1UNION SHOP COMMITTEE

The employer recognises the Union Shop Committee as the appropriate forum inwhich all matters relating to the day to day operationswill be raisedinitially with the union.

8.2UNION/MANAGEMENT CONSULTATIVE COMMITTEE

8.2.1There shall be joint workforce/management Consultative Committeeestablished at the plant.

8.2.2This Committee shall consist of the union shop committee and suchrepresentatives of the union as the union shall determine and suchmanagementrepresentatives, but including senior management levels, as the employer shalldetermine.

8.2.3This Committee shall meet on a regular basis to consider any issuerelating to the operation of this Agreement or any other matterwhich may beraised by the union or the employer.

8.2.4The kill floor delegates shall be allowed sufficient time off workto attend to necessary union business.

8.3SETTLEMENT OF DISPUTES

8.3.1Work shall continue throughout all negotiations.

8.3.2In the event of a dispute the union delegate concerned shallconfer with the senior supervisor of the Department. Failing a settlement,thedelegate shall notify the works delegate and the supervisor shall notify theworks management after which the works delegatewith the delegate concernedshall negotiate with the works management.

8.3.3Failing a settlement the Union Delegate shall convene a meeting ofthe union shop committee which shall discuss the matter in disputein anendeavour to solve the issue, then a delegation from that meeting shallnegotiate further with senior company management.

8.3.4In the event that a department stops work for a meeting, theresolution of that meeting is taken to the Senior Management by a delegationoftwo members and the remaining union members of that meeting are to resumewithout delay.

8.3.5Failing a settlement of the dispute the delegate shall notify theunion and the works management may notify its employer organisationsbetweenthe works management, the union shop committee or its representatives andrepresentatives of the union and the appropriateemployer Organisation with theview of settling the particular dispute.

8.3.6If agreement still cannot be reached, the matter shall be taken tothe Commission for settlement.

8.3.7Both parties reserve the right to notify the Commission should theabove provisions not be carried out.

8.3.8The employer and the union agree that in the event of any disputeconcerning the termination of any employee under clause 2.1.4(Warnings/Dismissals)the matter will be taken to the Commission fordetermination. The employer and the union agree they will accept thejurisdictionand decision of the Commission as constituted and the union willnot support any other legal action in any other jurisdiction.'

227Clause 2.3 stipulated an even wider function of the consultativecommittee as follows:

`2.3CHANGES TO SYSTEMS AND METHODS OF WORK

2.3.1General decisions regarding methods of work, production processes,waste minimisation, introduction of machinery or new technologyetc., shall bemade following consultation and agreement with the Consultative Committeeestablished under Clause 8.2.

2.3.2If the employer contemplates an entirely new method of processingwithin the establishment such as installation of machinesor new technology itwill inform employees of their intention to do so as soon aspracticable.'

228In his affidavit Mr Davey described the types of disputes whichoccurred. Most disputes were settled at the delegate level. However, therewere a significant number which called for Mr Davey's attendance at Brooklyn,and reference to the grievance procedure. Mr Davey gave evidence that hespoke to supervisors or managers at Belandra about matters in dispute onaverage every second dayand met with senior management on average once amonth. In par 44 of the same affidavit, Mr Davey said:

`These[a list of 22 industrial issues referred to in theprevious paragraph of his affidavit]were recurring issues, particularly onthe beef and mutton chains. They frequently required meetings betweenmanagement and the delegates,sometimes with the Union. They sometimesresulted in stopworks or other industrial action.'

229The response of Mr Cabral in his affidavit sworn on 4 September 2002stated:

`I do not agree with Mr Davey's description of various mattersin paragraph 44 of his second affidavit as recurring issues. Thereweremeetings on a regular basis between management and delegates. These meetingsare required under the 1997 Agreement and the2000 Agreement, which hadprovisions for meetings of a union/management consultative committee (seeclause 8 of the 2000 Agreement). These consultative committee meetings wereheld regularly. It was the proper forum for such issues to be raised. Iattended suchmeetings when I was able to.'

230Mr Davey also made clear in his evidence that he found Belandra moredifficult to work with than other meatworks with which hehad been involved.He said, for instance, in reexamination:

`So what I'd like you to do is to make a comparison pleasebetween the approach you've just indicated was adopted by the persons you'vereferred to in management here and your other settings. Is there somedifference that you can identify in approach? --- Yes.

What is it? --- That there were more of those sorts of problems at Belandrathan at the other places, similar places I go to.'

231The area of contention over industrial disputation at the Brooklyn sitewas a matter more of degree than substance. Mr Daveywas in a particularlygood position to compare the level of disputation at Brooklyn with other works.He had been involved in themeat industry since 1972, firstly working as alabourer, then as a slaughterman. In 1981, he commenced employment with theapplicant,and has held organising roles ever since. Then in 1997, he becameassistant secretary of the Victorian Branch of the applicant. One of hisfunctions was to organise at Brooklyn. He gave evidence in a careful andconsidered way. I accept his evidence thatthe level of disputation atBrooklyn was high and required frequent use of the grievance procedure.

232It is now necessary to return to the passages from the cross-examination ofMr Catalfamo. Although the passages are quite lengthy,it is useful to setthem out in full.

`One of the reasons why you wanted to set up this model isbecause you did not want any longer to have the hassles which you toldus abouta little while ago with all the industrial issues?---One is the industrialissues, yes.

One of them?---One of them.

Those industrial issues came from being tied down to the procedures underthe enterprise agreements that you had?---I don't agreewith that.

You don't?---No. We worked with the union very well. We established - weasked them to come to us in 95 as we were setting up thenew beef kill for - weworked with them very well. I've got no problem with union or any union. Atthe end of the day if peoplewant to join a union - I've been a worker all mylife, I believe in unions, but where - we've got no problem with the enterpriseagreement.

Then what are you talking about when you refer to the industrial issues thatyou were - - -?---The industrial issue at plant levelinemploying five or six hundred people - and with the extensions that werecurrent at the time of pre-fire, there were going tobe a thousand people onsite and as I said before the fire made us stop and think of the problems thatwe had and where we were going. The extensions had already been startedpre-fire, you know. There would have been a thousand people there. It wouldhave - weasked Mr Davey and Mr Bird to come to our office in 95 aswe started setting this new kill floor, and we worked out an enterpriseagreement with it. We had no problem with that. But having had six years ofit and it's in the growth of the business, having seenthe problems of thatgrowth, we decided we didn't want to be employers of people any more. Let the- we had problems in terms ofpayment, delivery of payment to the workers.That happened three or four times and each time they went home or thereabouts -notevery time but certainly a few times they went out, because the computerbroke down or something happened - they went out. Now,do I want to have thathassle? We offered people money. The next morning if they didn't have theirpayment, we offered - if theyhad a cost, we would meet the cost. No, they'vegone home, they've just gone home. Now, I don't want to employ people likethat. We've always paid our people. We offered them extra money if theymissed some payment because it didn't hit the bank at the righttime; no, theyjust went home. Here I am, working 14, 16, 18 hours a day, seven days aweek and people just - but going back tothe union, we have no problem with theunion. If the union thinks we've got a problem with them, they're wrong.But certainly, we want to run our own business. We don't have a problem ifthe union is there in the peripherals. If people want to join the union,that's their business. But certainly, we have tested the model at Yarrawonga,we like it, it'sin its infancy, it needs fine-tuning, but it works. It makespeople responsible for their jobs.

It makes people responsible for their jobs because they're dependent onbeing called in from day to day. Isn't that right?---Thatcan change,Mr Borenstein.

But that's the position at the moment, isn't it?---That's the position atthe moment but that's not to say - - -

And that's not the position that applied under the enterprise agreement, isit?

---No.'[emphasis added]

233Later, the following exchange occurred:

`Can I suggest to you that the model that you attempted to usein the P and R room where you tried to bring in the labour-hire peoplein theafternoon shift showed you that in order to get away from the enterpriseagreement and in order to get away from the unionyou had to have a companybetween you and the workers and that's what you did at Altona?---That is notso, sir.

Can I suggest to you that the only reason why you have signed an agreementwith the union in Tasmania is because, for the time being,the union in theTasmanian plant has a very high level of numbers and for you to refuse to signwould have caused you a considerableamount of industrial difficulty?---Sir, Ihave never run away in my life from a good fight if I believe in it.

The position was different in the P and R room because the numbers of peoplethat were left as direct employees were far smaller thanthe number of peoplethat you brought in as labour hire?---That's what you say. I disagree with allthis line of questioning thatyou're putting to me.

To prove the point, when the P and R room ceased operations and the work wasput across to Altona in November of last year - the workfrom the P and R roomwas taken across to Altona - the only workers who used to work in P and R whowere taken across to Altona werethe labour-hire people and not your directemployees?---It wasn't just us, sir. It was anybody that decided to takevoluntary redundancyin the P and R room and asked for a job at Altona weregiven a job.

They were given a job if they went to Altona and gave up the conditions ofthe enterprise agreement?---Well, sir, there's 350 peopleworking at Altona.I'm sure that they don't crack a whip at them every morning and say, "You'vegot to work." They do come to workon their own legs. They earn big money andthey look like a pretty happy workforce to me, not that I go thereoften.

Mr Catalfamo, in order to go to Altona, the people who used to be directemployees at the P and R room would have to give up the enterpriseagreement.That's correct, isn't it?---These people wereoffered - - -

Can you just answer my question? Is that correct or not?---That is notcorrect, sir.

So they could take the agreement across, could they?---In the sense thatthese people had many thousands of dollars in redundanciespayed[sic]to them. They took voluntary redundancy and the next day they applied for ajob and got a job at Altona. It is their choice. Thatis clearly theirchoice.

I'm sorry, did you say that they - - -

HIS HONOUR: Mr Catalfamo, I think the question is whether youwere offering them, as part of their choice, the opportunity to workat Altonaunder the EBA?---No, that was not it, sir.

I think that's what the question is getting at.

MR BORENSTEIN: I put it to you that the reason that wasn't done wasbecause the whole strategy in the P and R room was to get ridof the enterpriseagreement. That's the position, isn't it?---The correct assessment of thewhole situation is that we want to work- we want to run our own business. Inthree or four or five years' time we're going to develop a model which will beconsistentwith running a meat business in Victoria today successfully. That'swhat we're talking about here.

I was going to come to that. You told us before lunch that you wanted torun your own business?---Yes, we do.

You told us about the difficulties you had, for example, by people going onstrike because their pay wasn't on time or it was incorrector things likethat?

---On the smallest of pretexts.

Yes, and all of those issues come up because you have union delegates on thesite who call the people together and make those sortof decisions. That's howit happens, isn't it?---Not always.

No, but overwhelmingly that's how it happens. You don't see that in jobswhere there are no union delegates, do you?---I - - -

Have you answered?---No, I can't answer it. I cannot answer it.

The union delegates on that job, you saw as being a source of difficultywhich prevented you from running the business the way youwanted to?---I willsay it again, Mr Borenstein, we have got no problem - we have got no issuewith people belonging to the union,being unionised. We've got no issue withit, none whatsoever.

Look, Mr Catalfamo - - -?---We just want - we have -yes, I will say this: wehave a philosophical difference with the union inVictoria. We have had many discussions. We had a situation where wenegotiated one EBA for seven months and came to an agreement. Mr Daveyand MrBird sat up in that room week after week and we negotiated an agreement, andpart of that agreement was that we would puta piece of equipment which we hadordered and would be installed three or four months later. When it came time -this is just onelittle snippet. When it came time for us to put the piece ofequipment, basically we still had to pay totally for the man that thatpiece ofequipment took the position of.

They're the sort of problems which get under your skin?---Yes.

Absolutely?---Yes.

Because they're the sort of decisions that interfere with you being able torun the plant like you think it should be run?---We wantto run a business ofbuying meat and selling meat and developing markets. We don't want to be up toour armpits in industrial relationsevery day of our lives. We don't. As Isaid earlier on, Mr Borenstein, I want people to be a bit more responsiblefor their jobs.

The issues of the sort that you were talking about, being paid for tallywhen the machine gets installed - - -?---But that's justoneexample, one little example.

I know, I understand that. Issues of that sort, they all come up because,number one, you have an active union and union delegateson your site?

---We don't have a problem with a responsible active union. We don'thave a problem with that.

But you don't regard the way in which the union operated on your site asbeing responsible. Isn't that what you're saying?---In ournegotiations withthe union over the years, and as I said earlier on before lunch, we welcomedthe union to our site in 1995. Itwas the place - there was no employmentthere. The place had been shut. We went and spent a lot of money, reinstatedthe abattoir. We invited Mr Davey and Mr Bird to come in and sitdown and work out a labour contract, an EBA.We didn't have a problem withthat. Over the years we have worked very closely with them, very close, and wehave a - my problemis one where I want to run my business different in thefuture.

But, you see, you have told us that, for example, in Tasmania you haveintroduced your model by employing labour-hire people downthere andprogressively you're going to employ more and more labour-hire people?

---Correct.

But those abattoirs are all operated by TGS. TGS is theowner?---Yes.

You haven't done that at Altona?---Give us time, Mr Borenstein. Imean, we have only been in there for five minutes.

I'm sorry. In Altona you could have done immediately exactly what you sayyou were doing in Tasmania by having TGS have the agreement,make the agreementwith the labour hire company to supply workers. You could have done exactly atAltona what you have been doingin Tasmania. You started at the same time inboth places but in Altona you did it differently. You did it withMr Carroll?---Mm'hm.

I'm putting to you that the reason you did it differently was because youwanted to get rid of the influence of the union here inMelbourne and youwanted to get rid of this particular enterprise agreement and that's the reasonwhy you have treated Altona differentlythan any other place.

MR PARRY: I think that can be broken up a little bit, to be fair tothe witness. It rolls in; the influence of the union and theEBA and a fewother things. I think it should be just broken up and put in parts to thewitness, your Honour.

MR BORENSTEIN: In Altona you have set up your model differently thanin Tasmania because you don't directly engage the labour hirepeople in Altona,correct?---Could you repeat that, sir?

At Altona TGS does not engage the labour hire employees directly, doesit?

---No.

In Tasmania it does, doesn't it?---It does, yes.

The system you have got in Altona is different because you have putMr Carroll's company between you, between TGS and the workers?

---That's so, yes.

What I'm putting to you is - - -

HIS HONOUR: Between TGS and the labour hire.

MR BORENSTEIN: And the labour hire company?---As Mr(indistinct)

What I'm putting to you is that there is a good reason why you have donethat in Melbourne and the good reason is, firstly, that youwanted to get ridof any suggestion that the enterprise agreement could go across toAltona?

---Mr Borenstein, your speculation leaves me a little bit dismayed.That's not the reason at all. Your speculative comments arejust- - -

The second reason why you've done it is because you want to avoid anypossibility - or you want to minimise any possibility of theunion getting anyinfluence on the Altona site. That's the second reason. Do you agree withthat?---That's not so.

Can you give me one sensible reason why at Altona you have set up theoperation differently than you are running it in the two locationsinTasmania?

---Why?Because we are diametrically opposites at the moment with theunion. We are at opposite ends of the spectrum. Having worked closelywiththem we just can't seem to be able, ideologically - and I'm no ideologue,your Honour. You know, I just - having been involved in this industry nowfor 40 years and having put forward many suggestionsand many ideas across thetable, I would get - prevent the industry in the state. I would get - theindustry could grow - you mightas well talk to the wall. You know, I just -we have gone - we have walked the walk, met them, invited them, spoke withthem, overmany years.We cannot get the smallest change. That is thetruth of it. You might as well talk to the wall. Here we are investingmillions of dollars in an industry that's defunct in this state. This state,your Honour, used to have 17,000members. The union had 17,000 members inthis state back in the 70s. The industry has left the state, has taken flight.Withina small radius of where we are, within a five kilometre radius, therewas 10 abattoirs, large ones. They're all gone, we are theonly ones leftstanding at the moment. We want to grow the business. We want to grow ourexport business and our domestic business. We want to employ people. We don'twant - we want to give them conditions. But every time we've - we don't want -basically they got us to the point now where we don't want to employ peopledirectly any more because of the resistance to change and there's a - goingto work every day and running a meat plant is not an easy task. The biggestsingle problem is the industrialrelation issue, because business can be got -there's plenty of business over the water and there's plenty of businessdomestically,if you do the job right.All we asked for was a bit ofcooperation with the union and a bit of - just listening to some changes."Let's implement some changes." Even the smallest of change was answeredby, "But you used to do it like that 30 years ago, 40 years ago and some verysmart peoplethought about that." But 30, 40 years ago they used to pick upcarcasses off the concrete and lift them up and put them on the rail. Nowthere's a lot of machinery that does all that hard work. We're talking about alot of things.

The ability of the union to behave in the way in which you've just describedis facilitated by the procedures under the enterpriseagreement, isn't it?They can take you on grievance procedures to the commission, they can force youto go and consult about thingsand all of that sort of thing. It's part of theweapon they use to - - -?---At the meat plant, when all elsefails, pull out anOH and S issue.'[emphasis added]

234The first thing which must be highlighted is that these passages arecentral to the determination of whether Belandra has negativedthe existence ofthe proscribed reasons. The applicant relied on other evidence that was saidto show anti-union conduct by Belandra. For instance, at a meeting after thefire with union officials, Mr Cabral, in the presence of Mr Catalfamo, engagedin an outburstdirected against Scott Davis. He called Mr Davis a troublemaker and said that he would not be reemployed. This incident, and severalsimilar ones, have alternative explanations. I do not find them either aloneor together useful in forming a view as to Belandra'smotivation in September2001.

235The main evidence which throws light on the reasons for Belandra's conductis the evidence of Mr Catalfamo himself, and an importantpart of that evidenceis contained in the passages set out above.

236When these passages are read in transcript they present a problem ofinterpretation because they contain statements which seemcontradictory. Atone point Mr Catalfamo said that he had no problem with the union, but atanother point he said that he foundthe union difficult to work with and thatBelandra was at "diametrically opposites" with the union. Of course, theevidence mustbe viewed in its totality rather than by reference to individualstatements alone. Further, the evidence must be viewed in the contextof thewhole of the evidence in the case.

237In addition, in this case, it is useful to have regard to the impressionmade by Mr Catalfamo in the witness box. His demeanour,the way he answeredquestions, what he chose to emphasise, and what he chose to avoid, all create apicture which assists in resolvingthe apparent contradictions in his evidence.It is now well accepted that judges must be careful in using this type ofapproach toassess evidence. Witnesses may give the wrong impression becauseof the strangeness to them of the courtroom environment. Further,there is ahigh degree of subjectivity in making judgments based on the impression made bya witness in the witness box. However,in a situation like the present, wherethe mental processes of the witness are in issue, and there is little objectiveevidence availableapart from the evidence of the witness himself, there isroom for the use of such an approach. Given the danger of injustice inplacingtoo high a reliance on the impression created by a witness in the witness box,it is necessary to approach the matter withcaution. With that caution in mindI turn to my assessment of Mr Catalfamo's evidence.

238The overwhelming impression that Mr Catalfamo gave was that he was a personaccustomed to exercising control, and of havinghis views accepted withoutopposition.

239He acted with generosity to those who were loyal and supportive. Oneexample is that he acted as a mentor to Mr Cabral andsponsored hiscareer. He provided guarantees of several hundreds of thousands of dollars tocompanies operated by Mr Cabral in orderto assist his advancement in the meatbusiness. In return, it was clear from my observation of Mr Cabral in thewitness box thathe accepted that Mr Catalfamo had a dominant role in theoperation of the business. A similar relationship between Mr Catalfamoand MrOravec was evidenced from my observations of Mr Oravec in the witness box. MrCatalfamo described his approach to businessas follows:

`Mr Borenstein, in business one does a lot of things over theyears. I have lent money and I have helped fellow meat people herein themeat industry at times when they've needed it. I have been helped when I'veneeded help. I have got certain bonds with certainpeople. The Cabrals haveworked for me. The father had worked for me since 1980. Now, I trust himimplicitly. He has been verygood; he's been trustworthy, diligent. Now, hischildren, Gilbert who came to work for me in 85 or 86 worked very hard for meatRichmond cold store which was a turn-of-the-century cold store. I mean, itwas a hovel of a place to run. He ran it very well. He showed promise. Heasked me where he should go next; not different than his brother Bernie askingme, "Joe, I've got $50,000in the bank. Where do I invest it?" I said to him,"Buy something in Richmond. You can't go wrong." It's advice one gives. He'sstill got that property that he bought for 70,000 and today it's worth 300,000.Now, what's wrong with that?'

240Mr Catalfamo expressed his views about the history of the meat industry,and the future of the meat industry forcefully. Hisevidence showed that hehad firm ideas about these matters. It was also obvious that Mr Catalfamo wasnot particularly open to accommodatingcontrary views. He reacted to thequestioning of his views with a degree of impatience and dismissiveness. Inthe same way, afterhis long experience in the meat industry, and having strongviews about how the business operation should be changed, it was clearfrom hisevidence that Mr Catalfamo was no longer prepared to tolerate any obstructionto the operation of the business. When theextracted passages are read in thelight of the impressions made by Mr Catalfamo in the witness box and with theevidence as a whole,I find that Mr Catalfamo was content to engage with theapplicant only if it cooperated with him, and if it accepted his vision ofchange without question. Otherwise, he was not prepared to have anything to dowith the applicant. His reference to his wish to`run the business' meant thathe wanted to be able to run the business free of the constraint of the 2000Agreement, and free ofthe need to deal with the applicant. His overallposition was best revealed when he said:

`But certainly, we want to run our own business. We don't havea problem if the union is there in the peripherals.'

The high level of industrial disputation at the Brooklyn site referred toearlier reflected the growing determination of Belandrato resist the demandsof the applicant.

241The respondents argued that even if Mr Catalfamo was not prepared tocontinue to deal with Mr Bird or Mr Davey, the Secretaryand AssistantSecretary of the Victorian Branch of the applicant respectively, and thisattitude led to his decision not to employthe Belandra employees, suchmotivation did not amount to acting because the Belandra employees were membersof the applicant. Rather,the motivation was personally directed against twoindividuals. I do not accept this contention. Mr Bird and Mr Davey engagedwithMr Catalfamo in their capacities as officials of the applicant. There isno suggestion that Mr Catalfamo's attitude was personallydirected. On thecontrary, he had dealt with them as union officials in the past. MrCatalfamo's rejection of their interventionon behalf of the Belandra employeeswas directed against their role as officials of a trade union. Any otherofficial who presentedan impediment to Mr Catalfamo's wish to operateunhindered would have encountered the same response.

242In relation to the requirement for the necessary causal link between theconduct and the reasons for the conduct, as discussedin pars 87 - 98 ofthese reasons. I find that the existence of the 2000 Agreement was not justthe cause of the situation givingrise to the refusal to reemploy, but was areason for it.

Conclusion - Reasons For The Conduct

243In the result, Belandra has not displaced the presumption that it refusedto reemploy the Belandra employees for reasons whichincluded that theapplicant represented them collectively as an incident of their membership ofthe applicant. It will be recalledthat this falls within the reason referredto in s 298L(1)(a), following the construction which I have adopted inpars 102 to 217. Further, Belandra has not displaced the presumption that itrefused to reemploy the Belandra employees because they were entitledto the2000 Agreement.

REMEDY

244It follows from these reasons that Belandra has contravened the Act byengaging in conduct referred to in ss 298K(1)(c) and(d) for the reasonsset out in s 298L(1)(a) and (h). Consequently, the Court will now makedeclarations to that effect. The applicationwill be re-listed for directionsat 10.15 am on 26 September 2003, in order to fix a timetable for the hearingon penalty and theother relief sought.

Associate:

Dated:29 August 2003