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Industrial action benchbook

An overview of legal procedure & case law

Employer response action

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  • What is employer response action?
  • Employer may refuse to make payments to employees
  • Continuity of employment not affected
  • Accrual of annual leave
  • Case example
  • References

What is employer response action?

See Fair Work Act s.411

Employer response action for a proposed enterprise agreement means industrial action that:

  • is organised or engaged in as a response to industrial action by:
    • a bargaining representative of an employee who will be covered by the proposed enterprise agreement, or
    • an employee who will be covered by the proposed enterprise agreement; and
  • is organised or engaged in by an employer that will be covered by the proposed enterprise agreement against one or more employees that will be covered by the proposed enterprise agreement.

Employer response action must be in response to industrial action, as defined, that is happening. Employer response action cannot, by definition, be in response to industrial action that is threatened, impending, probable or even imminent at the time that the employer's industrial action is implemented.[1]

As defined, the only form of employer response action is a lockout.[2]

An employer may also take other action, which is not 'employer response action', in response to employee claim action. This other action can include:

  • standing-down employees in accordance with Part 3–5 of the Fair Work Act, or
  • declining to pay employees for partial work bans in accordance with partial work bans under s.471(4).
The trigger for employer response action is that employees have taken employee claim action.[3]

In Australian and International Pilots Association v Fair Work Australia[4] the Full Court of the Federal Court considered whether there needed to be a link between employer response action and industrial action taken by employees. The Court found that the terms of the Fair Work Act limit an employer to some form of causally connected response to employee industrial action.

The words 'as a response' require only that the lockout be seen as causally connected to employees' industrial action. It does not have to be reasonable, proportionate or rational.[5]

A causal connection is the relation of cause and effect.[6]

In this context the ‘cause’ is the employee industrial action and the 'effect' is the employer response action.

Employer response action can be protected industrial action if it is engaged in in accordance with s.411 of the Fair Work Act in response to employee industrial action which is or is not protected action.[7]

Employer may refuse to make payments to employees

If an employer engages in employer response action against employees, the employer may refuse to make payments to the employees in relation to the period of the action.[8]

An employer may lockout its employees and refuse to pay them in order to support or advance the employer’s claims during bargaining in relation to a proposed enterprise agreement.

Employers have various statutory and common law rights to respond to industrial action by employees and such responses will not constitute industrial action unless the employer’s action is a lockout. For example, in particular circumstances an employer may have the right to respond to industrial action by:

  • standing-down employees in accordance with Part 3–5 of the Fair Work Act, or
  • declining to pay employees for partial work bans in accordance with partial work bans under s.471(4).

Related information

  • Payments relating to industrial action

Continuity of employment not affected

Employer response action for a proposed enterprise agreement does not affect the continuity of employment of the employees who will be covered by the proposed enterprise agreement.[9]

The Fair Work Regulations set out purposes for which continuity of employment is not affected by an employer taking industrial action. These are:

  • superannuation
  • remuneration and promotion which may be affected by seniority, and
  • any entitlements under the National Employment Standards.[10]

This means that an employee’s period of employment with an employer is not broken by the employer engaging in industrial action.

For instance, if an employer locks out its employees for one day each week, the employees are still considered to be employees for the purposes of things like superannuation even though the employees may not be getting paid. The employees’ employment does not stop when the employer takes industrial action and then start again after the industrial action has finished.

An employee remains employed regardless of the industrial action taking place.

Related information

  • Coverage of national workplace relations laws

Accrual of annual leave

There is no entitlement to annual leave (a NES entitlement) for the lockout period when the industrial action is valid employer response action under the Fair Work Act. The entitlement to annual leave in s.87 is for ‘service’. A period of lockout does not count as employee ‘service’ by reason of s.22(2)(b).[11]

"Meanings of service and continuous service

…

(2) [Exceptions to meaning of service]

The following periods do not count as service:

…

(b) any period of unpaid leave or unpaid authorised absence other than;

(i) a period of absence under Division 8 of Part 2-2 (which deals with community service leave); or

(ii) a period of stand down under Part 3-5, under an Enterprise Agreement that applies to the employee, or under the employee’s contract of employment; or

(iii) a period of leave or absence of a kind prescribed by the regulations;

…"[12]

Case example

Action found NOT to be employer response action

Australasian Meat Industry Employees Union, The v JBS Australia Pty Ltd

[2014] FWC 2254 (Bartel DP, 4 April 2014)

Facts

The AMIEU made an application for an order pursuant to s.418 that industrial action taken by JBS stop.

JBS operate a meat works plant in Bordertown SA. It was in negotiations with the AMIEU for an enterprise agreement to replace an expired agreement.

The AMIEU provided written notice to JBS of protected industrial action to commence on 2 April 2014 in the form of multiple stoppages. On 31 March 2014 JBS provided notice to AMIEU of employer response action, stating that JBS was unable to provide employment on 2 April 2014, or on any other day in which employees could not be reasonably employed.

The AMIEU contended that the employer response action was not protected industrial action because no industrial action had taken place by the employees.

Outcome

The Commission was satisfied that the action taken by JBS was a lockout of employees and that this action was not protected industrial action because it did not meet the definition of 'employer response action' in s.411.

Relevance

Employer response action must be in response to industrial action that is happening. It cannot be in response to industrial action that is threatened, impending, probable or even imminent at the time that the employer's industrial action is implemented.

Action taken by employer after employee claim action had ceased found to be employer response action

United Voice v MSS Security Services Pty Ltd

United Voice v MSS Security Services Pty Ltd [2013] FWC 4087 (Cloghan C, 27 June 2013).

Facts

United Voice made an application to the Commission under s.418 for an order that proposed employer response action by MSS stop.

UV and MSS had been bargaining for a proposed enterprise agreement. UV had given notice of employee claim action. In response MSS gave notice to UV of employer response action in the form of a lockout of five employees, advising that the lockout was being organised and engaged in as a response to the industrial action. Subsequently UV gave MSS notice of employee response action as a direct response to the lockout of the five employees. The notice advised that all members of UV would be engaging in a 24 hour stoppage of work.

MSS gave notice of further employer response action in the form of a lockout of nine employees. The notice stated that the lockout was being organised and engaged in as a response to the industrial action that had been taken and provided that the lockout would ‘continue indefinitely’.

UV contended that the employer response action was not protected industrial action because the employee claim action had occurred and was ‘no longer action which is happening, threatened, impending, probable or being organised’.

Outcome

The Commission held that employer response action could only occur in response to employee claim action that is or has taken place. The Commission was satisfied that the employer response action was in reply to, and in answer to, the employee claim action, and that the employer response action was protected industrial action.

Relevance

There is no condition in the Fair Work Act which prevents an employer from taking employer response action because a particular occurrence of employee claim action has ceased.

References

[1] Australasian Meat Industry Employees Union, The v JBS Australia Pty Ltd [2014] FWC 2254 (Bartel DP, 4 April 2014) at para 20.

[2] Fair Work Act s.19(1)(d).

[3] United Voice v MSS Security Services Pty Ltd [2013] FWC 4087 (Cloghan C, 27 June 2013) at para. 56.

[4] [2012] FCAFC 65 (10 May 2012) at para. 116.

[5] Australian and International Pilots Association v Fair Work Australia [2012] FCAFC 65 (10 May 2012) at para. 155.

[6] Butterworths Australian Legal Dictionary, 1997, at p. 172.

[7] Construction, Forestry, Mining and Energy Union v Bechtel Construction (Australia) Pty Ltd and another [2014] FWCFB 8490 (Catanzariti VP, Richards SDP, Booth C, 15 December 2015) at para. 14; citing Australian and International Pilots Association v Fair Work Australia [2012] FCAFC 65 (10 May 2012) at para. 24, [(2012) 202 FCR 200].

[8] Fair Work Act s.416.

[9] Fair Work Act s.416A.

[10] Fair Work Regulations r.3.09.

[11] Construction, Forestry, Mining and Energy Union and Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Carter Holt Harvey Woodproducts Australia Pty Ltd T/A Carter Holt Harvey [2018] FWC 6 (Gostencnik DP, 16 January 2018); upheld on appeal [2018] FWCFB 2731 (Hamberger SDP, Colman DP, Harper-Greenwell C, 15 May 2018).

[12] Fair Work Act s.22(2)(b).

Updated time

Last updated

07 October 2019

 

 

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        • The modern era: The development of a modern minimum wage
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        • Launch speech?Treasures of the Archives
        • 1. Professor Isaac
        • 2. Register of organisations
        • 3. Perlman letters
        • 4. Sir Richard Kirby photograph
        • 5. Oral history program
        • 6. AIRC sign
        • 7. Folder of wage decisions
        • 8. Centenary exhibition
        • 9. Women's exhibition poster
        • 10. Isaac letters
    • The modern era
    • Past Presidents
    • Past Members
      • Past Members 1956 to present
      • Past Members to 1956
  • Unfair dismissals benchbook
    • Overview of unfair dismissal
    • Glossary & naming conventions
    • Coverage for unfair dismissal
      • Who is protected from unfair dismissal?
      • People excluded from national unfair dismissal laws
        • Independent contractors
        • Labour hire workers
        • Vocational placements & volunteers
        • Public sector employment
      • Constitutional corporations
      • High income threshold
      • Modern award coverage
      • Application of an enterprise agreement
      • What is the minimum period of employment?
        • How do you calculate the minimum period of employment?
        • What is continuous service?
        • What is an excluded period?
      • Bankruptcy
      • Insolvency
    • What is dismissal?
      • When does a dismissal take effect?
      • Terminated at the employer's initiative
      • Forced resignation
      • Demotion
      • Contract for a specified period of time
      • Contract for a specified task
      • Contract for a specified season
      • Training arrangement
      • What is a transfer of employment?
      • Periods of service as a casual employee
      • What is a genuine redundancy?
        • Job no longer required due to changes in operational requirements
        • Consultation obligations
        • Redeployment
      • What is the Small Business Fair Dismissal Code?
    • What makes a dismissal unfair?
      • Valid reason relating to capacity or conduct
        • Capacity
        • Conduct
      • Notification of reason for dismissal
      • Opportunity to respond
      • Unreasonable refusal of a support person
      • Warnings – unsatisfactory performance
      • Size of employer's enterprise and human resources specialists
      • Other relevant matters
    • Making an application
      • Application fee
      • Timeframe for lodgment
      • Extension of time for lodging an application
      • Who is the employer?
      • Multiple actions
      • Discontinuing an application
    • Objecting to an application
    • Commission process
      • Conciliation
      • Hearings and conferences
      • Preparing for hearings and conferences
      • Representation by lawyers and paid agents
      • Rescheduling or adjourning matters
      • Bias
    • Remedies
      • Reinstatement
        • Order for reinstatement cannot be subject to conditions
        • Order to maintain continuity
        • Order to restore lost pay
      • Compensation
        • Calculating compensation
        • Mitigation
        • Remuneration
        • Other relevant matters
        • Compensation cap
        • Instalments
    • Dismissing an application
    • Evidence
    • Costs
      • Costs against representatives
      • Security for costs
    • Appeals
      • Staying decisions
    • Role of the Court
  • Waltzing Matilda and the Sunshine Harvester Factory
    • Introduction
    • The book
      • Book launch
    • The film
      • Film launch
    • Historical material
      • 38 Hour Week Wage Principle [1983]
      • 40 Hour Week Case [1947]
      • 44 Hour Week Case [1927]
      • Apprenticeship indentures
      • Australian Minimum Wage and fitter (trades) rate since 1906
      • Boot Trades Case
      • Careers in Bootmaking and Boot Repairing
      • Cattle Industry Case 1966
      • Commercial Printing Case [1936]
      • Commonwealth Conciliation and Arbitration Act 1904
      • Cost of living newspaper articles from the early 1900s
      • Debates
      • Equal Pay Case 1969
      • Equal Pay Case 1972
      • Fruit Pickers Case
      • Gas Employees Case
      • Graph of Australian Minimum Wage since 1906
      • Harvester Case
      • Historic case judgments on the Fair Work Commission's website
      • Kingston's evidence
      • Linesmen's Case
      • Maternity Leave Case [1979]
      • Metal trades base level minimum wages [1967–2015]
      • Methods of wage adjustment
        • Establishing an Australian Minimum Wage 1907?1922
          • The origins of the Australian minimum wage
          • The 'needs' principle and 'capacity to pay'
          • Women's wages
          • First indexation decision
        • Quarterly indexation 1922–1953
        • The Great Depression 1931
        • Prosperity loadings 1937
        • World War II 1939–1945
        • The post-war period: 1953–1965 basic wage inquiries
        • The total wage 1966–1967
        • Removal of discrimination in award rates
        • Reintroduction of quarterly wage indexation 1975–1978
        • Six monthly wage indexation 1978–1981
        • Wage explosion 1981–1982
        • Reforming awards and work and management practices 1987–1991
        • Six monthly wage indexation 1983–1987
        • Enterprise bargaining and a minimum wage safety net 1991–1996
        • Statutory adjustments
        • The minimum wage in real terms
      • Mrs Beeton's cookbook
      • Paternity Leave Case [1990]
      • Personal/Carer's Leave Test Case [1995]
      • Piddington report
      • Re Bagshaw [1907]
      • Significant cases on the Fair Work Commission's website
      • Statistics for the purpose of comparison with the Australian minimum wage
      • The Amalgamated Society of Engineers v. The Adelaide Steam-ship Company Limited and Others
      • The Australian minimum wage from 1906
      • The Federated Marine Stewards and Pantrymen's Association v. The Commonwealth Steamship Owners' Association and Others
      • The Victorian minimum wage 1896
        • Legislative Council Second Reading Speech to the Factories and Shops Bill 1896
      • The first Award: 1906 Steam-ship Crew
      • 100 years of the minimum wage—Statistical comparison
    • Mrs Beeton's cookbook
    • Glossary
    • Related sites
    • Educational materials
  • AWRS First Findings report

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