Most employers would be very wary of sacking employees taking protected industrial action. But the Fair Work Commission has twice rejected union arguments claiming an employer has undermined collective bargaining and acted in bad faith by making employees redundant as a consequence of the industrial action taken.
The stoppages took place over a number of months in a mine. The operations were disrupted by insufficient numbers of workers attending to enable various pieces of heavy mining equipment to operate in their normal, co-ordinated fashion. Eventually the lack of synchronisation between the various pieces of equipment meant something had to give.
The company decided to mothball a large piece of equipment as it would save considerable money over the longer term to do so. The company had a clear business case which established that the continued use of that equipment was contingent on it staying on schedule with the overall mine plan. Since the industrial action caused it to fall behind, it was no longer meeting that requirement.
Eighty three personnel were made redundant as a result of this decision and that triggered the applications to the FWC. At both the initial hearing and the appeal, the FWC made the point that the redundancies were a direct result of the business case. Yes, it was true that the machine had fallen behind schedule because of the industrial action, but the decision to mothball it was based on the viability question (and the saving of $40 million over three years), not based on undermining or interfering with collective bargaining rights.
The full bench said being protected during bargaining “does not, however, mean that an employer of employees who take protected industrial action is not able to respond to protected industrial action, or to circumstances created by such action, in a manner that addresses its legitimate business interests, provided it meets its obligations under the Act.”.
The union has commenced action in the Federal Court in relation to the same circumstances, only in that forum, it is claiming adverse action was taken against the employees for exercising their workplace right to strike. That case is expected to be heard in March this year.