Case law CFMEU v Oaky Creek Coal Pty Ltd

5 Steps taken by Fair Work Commission & effectiveness: 6 Whether Fair Work Commission has greater powers to intervene in this type of protracted industrial dispute: 8 Recommendations: 9 Conclusion: 9 References: 10 Introduction: FWC plays most important role in the industrial action and it also ensures that any bargaining process and any industrial action accompanied with that, which mainly held as per the norms of the relevant Commonwealth workplace laws. This report is addressed to the President of the Fair Work Commission in context of role played by

Industrial Dispute 1
Industrial Dispute

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Executive Summary:
Recently, FWC give its historical decision in case law Construction, Forestry, Mining and
Energy Union v Oaky Creek Coal Pty Ltd (B2017/640). In this case main issue is whether
behavior alleged by the CFMEU results in any failure on part of the OCCPL to fulfill the good
faith bargaining requirement under section 228(1) )(e) of the Act to prevent from unpredictable
or unfair conduct which mainly determines the freedom of association or collective bargaining.
In this commission made the order related to the suspension of the locked out at mine. This
decision of the FWC was made on the request of the CMFEU but this decision also includes the
provision which satisfy the demands of Glencore. Decision taken by FWC in context of this case
is completely fair and ensures the benefit of the members, their families and the community of
Tieri. This paper also states that power of the FWC must be increased in context of those matters
which cause serious harm to the community and population of the country.

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Contents
Executive Summary:....................................................................................................................................2
Introduction:...............................................................................................................................................3
Brief overview of the dispute:.....................................................................................................................3
What are the issues in dispute for Oaky Creek Coal Pty Ltd?......................................................................5
Steps taken by Fair Work Commission & effectiveness:..............................................................................6
Whether Fair Work Commission has greater powers to intervene in this type of protracted industrial
dispute:........................................................................................................................................................8
Recommendations:.....................................................................................................................................9
Conclusion:..................................................................................................................................................9
References:................................................................................................................................................10

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Introduction:
FWC plays most important role in the industrial action and it also ensures that any
bargaining process and any industrial action accompanied with that, which mainly held as per the
norms of the relevant Commonwealth workplace laws. Those individuals who are representing
the bargaining power of employees can take industrial action for the purpose of supporting their
claims which must first seek an order from the FWC related to the protected action ballot which
authorized the industrial action (FWC, 2017).
This report is addressed to the President of the Fair Work Commission in context of role
played by FWC in the industrial dispute held between Oaky Creek Coal Pty Ltd and the
Construction, Forestry, Mining and Energy Union in 2017 and 2018. This report highlights the
commission’s effectiveness in resolving this dispute and after that paper is concluded with brief
conclusion. Lastly, it states the recommendation in context of intervention of the FWC in
different matters.
Brief overview of the dispute:
This matter mainly includes the application from the Construction, Forestry, Mining and
Energy Union (CFMEU) in context of bargaining order against the Oaky Creek Coal P/L
(OCCPL) in relation to the employees working at Oaky North Underground Coal Mine (Mine).
Both CFMEU and OCCPL engaged in negotiation for the replacement of the enterprise
agreement from the May 2015.
In May 2017, protected industrial action was commenced by the members of the
CMFEU, and after rejection of the vote related to the proposed agreement, notices related to the
protected industrial action for 15 and 16 July was withdrawn by the union and on these days
employees of the organization reported to work. On their returns employees were not able to
swipe their job cards, and later direction was issued to them to remove their CFMEU branded
shirts which are previously permitted.
On 17th and 18th July, protected industrial action was resumed by the employees, and
letters was issued by the OCCPL to 21 employees by alleging the breach of policy related to the
conduct engaged on the picket line. Five employees of the OCCPL were also get allegation
letters for breaching the policy related to the social media (Fair Work Commission, 2017).

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In this CFMEU alleged that conduct of the OCCPL include various unfair and
unpredictable acts such as issuance of allegation letters, surveillance of CFMEU members, and
cancel the permission to wear CFMEU clothing on site because it prevents the freedom of
association and collective bargaining. On 20th July 2017, employer response action was
implemented by the OCCPL and under this action they locked those employees outside the
premises who were the members of the CFMEU, and the mine continued their work with staff
and employees of contractors (Gellie, 2018).
In this case, industrial action is conducted by both the sides. On 9th June 2017, workers of
the organization were locked out by the organization after they reject the new enterprise
bargaining agreement (EBA) that mainly cut the wages and working conditions, and also include
provision related to limited industrial action. Company accused the workers to ignore an "in
principle" position that had been reached by the organization With the CFMEU leadership. It is
sated by AFMEU that offer provided by company is not adequate. In this bargaining order is
issued by FWC against the Glencore for engaging in such conduct which is capricious or unfair
in nature (FWC, 2017). In context of Hunter valley, negotiations at seven Glencore collieries
also witness the industrial action taken by workers in June. After conducting negotiations for the
period of 2 years or more, New Year deal is signed by the workers which ensures increase in the
pay scale but removes the provision of the job security. This deal was endorsed by the power
unions followed the Victorian government’s successful bid for the purpose of terminating the
proposed industrial action by both the Electrical Trades Union (ETU) and operator AGL
(Workplace Express, 2017).
Demonstration was also begun by the union at the Esso’s Longford gas plant in June for
the purpose of developing the plan developed by UGL in which they retrench the workers and
have a subsidiary rehire them on decrease pay and make changes in the fly-in, fly-out roster
(Stevens, 2017).
What are the issues in dispute for Oaky Creek Coal Pty Ltd?
Lockout of 190 workers is continued by Swiss mining conglomerate Glencore at its Oaky
North underground coal mine which is near the central Queensland town of Tieri. Workers of the
organization were locked out on 9th June after new enterprise bargaining agreement (EBA) was

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rejected by them because it cut wages and working conditions, and includes the rule of limited
industrial action. In 2018, Glencore Provocatively applied to the FWC for the purpose of
terminating the current EBA, which means that in case lockout were lifted by the Oaky North
miners would be employed by the organization under an industry award which includes inferior
pay and conditions (ACTU, 2018).
On 24th January, workers voted for an “in principle” EBA in the ratio of 164:11, which
was negotiated by the organization and the Construction, Forestry, Mining and Energy Union
(CFMEU) at the Fair Work Commission (FWC) (Australia’s pro-business industrial tribunal).
No details were released by CMFEU related to this principle (FWC, 2017).
This EBA offer was rejected by the workers third time because it corrode the conditions
related to the compensation and retrenchment dispute procedures, casual hire and workplace
representation, and it also allow the Glencore to change the rosters without any consultation. The
sixth month lockout is considered as longest lockout in the history of Australia.
Issues in dispute for the Construction, Forestry, Mining and Energy
Union:
CMFEU alleged that behavior of the OCCPL has conducted at an important time and
such behavior is completely unfair and unpredictable and also destabilizes the freedom of
association and collective bargaining. CFMEU further stated actions conducted by the actions of
the OCCPL also tend chilling effect on the bargaining process.
Threatening behavior of the Glencore was continuously criticized by the CFMEU, and
they also use Fair Work legislation’s anti-strike provisions which outlaw an all the united
industrial action by other workers, for the purpose of isolating the miners7 and create the
conditions under which they had no other option instead the accepting the deal which would
satisfy the demands of the company (Cook, 2018).
No such industrial action was called by CFMEU in context of 19000 workers which is
covered by the complete Australian coal industry for the purpose of backed out the locked-out
workers. They further allowed the continuous protection at Glencore’s other coal mining

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operations in the central Queensland Bowen Basin. In December, all the industrial action were
ended by the union of its 1400 members at Glencore’s Hunter Valley coal mines in New South
Wales for the purpose of pushing through new retrograde EBAs (Daily Mercury, 2018).
At the similar time, CCFMEU has enforced the directives with the help of judges of
FWC, for the purpose of ensuring that Oaky North production continuously uses the contract
labor and managerial staff. Locked workers have been restricted to an ineffective protest next to
main road and resulted to the main site. Even protestors have been prohibited through the FWC
ruling from shouting criticism of the scab workforce entering the site (Gahen, Pekarek &
Nicholson, 2018).
The CFMEU’s actions are in line with its role in providing facilities a far-reaching cost-
cutting restructure across the coal operations of the Glenccore’s which mainly includes numbers
of sackings, the gutting of conditions, and the increased use of contract labor. This restructure
also allowed the company to increase their revenue through the coal assets of Australia from
$US1.77 billion to $3.1 billion in the first half of 2017 (CFMEU, 2018; FWC, 2018).
Steps taken by Fair Work Commission & effectiveness:
The main issue in this case was whether behavior alleged by the CFMEU results in any
failure on part of the OCCPL to fulfill the good faith bargaining requirement under section
228(1) )(e) of the Act to prevent from unpredictable or unfair conduct which mainly determines
the freedom of association or collective bargaining.
After two days of hearing in the FWC, commissioner of the FEC that is Paula Spencer
made the order related to the suspension of the locked out at mine. These locked out workers,
after that participate in the return to work program. This point is considered as important turning
point in the long standing dispute between the CFMEU members and mine owner Glencore, as
both the parties of the dispute have continuously blamed the other one for the failure to agree in
context of new enterprise agreement. This dispute has turned ugly, and there are number of
people which have been charged under harassment offences while Glencore’s use of surveillance
cameras in the town of Tieri was made public (Terzon & Robinson, 2018).
This decision of the FWC was made on the request of the CMFEU but this decision also
includes the provision which satisfy the demands of Glencore. Spencer further made order to the

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miners to cast their vote on the enterprise agreement that had in-principle support from both
Glencore and key CFMEU members following a Fair Work hearing on January 10. This
agreement was voted down by almost 175 workers on 24th January. These votes will take place
on 27th march 2018 and it get continuous support from the CFMEU to the in principle agreement,
Glencore is hopeful in context of successful vote for the purpose of ending this industrial dispute.
In this case, Commission stated that it was accurately unpredictable or unfair for the
OCCPL to issue allegation letters to the employees in lieu of their conduct, and satisfied that
direction related to the wearing of Union clothing was also unpredictable. FWC also stated that
level of security operations and scope of these operations was unfair on the ground that it was a
uneven response to the conduct of CFMEU and their members. Therefore, orders were issued by
the commission (Kippen, 2018).
Effectiveness of the decision taken by the FWC can be ensuring through different factors and
these factors are stated below:
 Decision taken by FWC in context of private security operations is an effective decision
as commission stated that security operations conducted by the company do not fall under
the scope of reasonable actions. FWC criticize this action of the company and stated that
company must cease its surveillance of employees. This decision of the FWC ensures the
collective bargaining and freedom of association of workers.
 FWC also pass order against the military terms applied by organization on its anti-
workers operations, and compared their union members with their Viet Cong. FWC pass
order for the company to drop their disciplinary action against workers. This decision of
the FWC ensures equity on part of the workers and also maintains the balance between
the protected actions taken by both the parties (Glencore, 2018).
 Actions of Glenore fail to maintain the dignity of the law and now its tactics have been
exposed. This company was completely obsessed with the control and used private
security guards for the purpose of entrapping the workers. This action of the company
harms the personal space of the workers, and through their decision FWC protected the
personal life of the workers.
 FWC decision is completely fair and ensures the benefit of the members, their families
and the community of Tieri (FWC, 2018).”

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Intervention powers of the FWC:
Labor’s Fair Work Act defines the powers of fair Work Commission in 2009 and these
powers ensure the effective system of bargaining in context of industrial disputes. When this Act
was introduced by the labor government, powers of the unions were increased by this legislation
in almost a hundred areas and also provide more power to the commission to the disputes.
This Act ensures that the commission has important powers to interfere in the bargaining
disputes which were serious in nature. There are a number of cases in which a bargaining dispute
threatened the economy or the welfare of the population, in such cases it is important for the
commission to interfere in the matter and determine an effective outcome. It must be noted that,
the commission must not be given the power to interfere just on the fact that bargaining parties
have not reached an agreement after a protracted period. If decision of the commission is
enforced on parties, then such result is definitely not an agreement. Therefore, it can be said that
compulsory arbitration in this context was contrary to an enterprise agreement.
FWC ensures justice and equality while providing their decision in bargaining disputes
and for this purpose it is necessary for the government to provide adequate powers to the FWC.
In this case, both the parties fails to reach an agreement related to the protracted action for a long
time and this lockout affects both the economy and population of the Australia. However, it is
necessary for the government to increase the powers of the FWC such as by providing power to
intervene in the matter in which parties fail to reach enterprise agreement even after the expiry of
protracted matters and also power of review the enterprise agreement, so that FWC can intervene
on those cases also which affects the population and economy. FWC must be imposed with the
power to intervene in such matter and enforced their mandatory decision in such a bargaining
disputes (The Australian, 2018).
Conclusion:
After considering the above facts, it can be said that this case is historical in nature and it
provides different important decisions in context of industrial disputes. In the context of the
mining and energy sector, bargaining conducted between the CFMEU and Glencore at coal
mines in NSW and Queensland was considered as bitter and extended. At Glencore’s Oaky
North operation in Queensland, negotiations related to the new agreement which have been
conducted since mid-2015, and for this purpose workers voted twice to reject the proposed

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agreement. Later, FWC intervene in this dispute and issued orders. This repot addresses different
issues in context of FWC power and as per this report commission has important powers to
interfere in the bargaining disputes which were serious in nature, and there are number of cases
in which bargaining dispute threatened the economy or the welfare of the population, in such
cases it is important for the commission to interfere in the matter and determine an effective
outcome. However, it is necessary for the government to increase the powers of the FWC, so that
FWC can intervene on those cases also which affects the population and economy. FWC must be
imposed with the power to intervene in such matter and enforced their mandatory decision in
such bargaining disputes.
Recommendations:
It is necessary to make few sensible changes in the laws related to the bargaining dispute
but not such changes through which unions can seek balance in their favor. However, some of
these changes are recommended below:
 Commission must be entrusted with more power of intervene such as FWC get the power
to issue directions to any party if they believe that party is making undue demands and
their demands cause hardship to the community and other party, for the purpose of
dealing with the procedural defects in the approval applications of the enterprise
agreement. This power helps the commission to deal with those issues which arise
because of the procedural defect as it helps in resolving the matter earlier and easier (Ai
group, 2018).
 For the purpose of resolving the current issues with the Better Off Overall Test in context
of enterprise agreement for ensuring that such test must be implemented by the
commission to logical groups of employees, and not on the individual employees.
 Laws related to industrial actions must be framed in such manner as it only motivates the
good faith bargaining between the parties, but the present situation does not show any
such evidence. The basic grounds behind this recommendation is the increasing tendency
of the employers to circumvent the current law such as termination of agreements,
indulged in lockout for long period of time, and encourage only small group of workers

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to vote in favor of the agreement and such agreement is applicable on a large group of
workers. It is necessary to examine the good faith bargaining and in case it is not taking
place then factors must be determined which hinders this process (Floyd, n.d.).
 On the basis of these recommendations it can be said that unions ruin sufficient authority
for the purpose of assisting the parties to reach an effective agreement which maintain the
balance of rights between the parties of dispute.
References:

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ACTU, (2018). Oaky North workers mark 6 months locked out. Retrieved on 5th May 2018 from:
https://www.actu.org.au/actu-media/media-releases/2018/oaky-north-workers-mark-6-
months-locked-out.
AI group, (2018). ACTU claims about the FWC’s powers are fanciful. Retrieved on 5th May
2018 from: https://www.aigroup.com.au/policy-and-research/mediacentre/releases/
ACTU-Claims-24-Jan-2018/.
CFMEU, (2018). Fwc Orders Glencore To Cease Surveillance Of Its Employees, Withdraw
Displinary Action. Retrieved on 5th May 2018 from: https://me.cfmeu.org.au/news/fwc-
orders-glencore-cease-surveillance-its-employees-withdraw-displinary-action.
Cook, T. (2018). Australian mining union isolates locked out Oaky North workers. Retrieved on
5th May 2018 from: https://www.wsws.org/en/articles/2018/02/03/oaky-f03.html.
Daily Mercury, (2018). Glencore critical of locked out Oaky North miners. Retrieved on 5th May
2018 from: https://www.dailymercury.com.au/news/glencore-critical-of-locked-out-oaky-
north-miners/3331619/.
Fair Work Commission (FWC) (2017) FWC 5380; Construction, Forestry, Mining and Energy
Union v Oaky Creek Coal Pty Ltd (B2017/640).
Floyd, L. Fair work laws: Good faith bargaining, union right of entry and the legal notion of
"responsible unionism". Retrieved on 5th May 2018 from:
https://www.tradeunionroyalcommission.gov.au/Submissions/Documents/
ResponsesToIssuesPaper/
FloydFairWorkLawsGoodFaithBargainingUnionRightOfEntryAndTheLegalNotionOfRes
ponsibleUnionism.PDF.
FWC, (2017). Industrial Action. Retrieved on 5th May 2018 from:
https://www.fairwork.gov.au/how-we-will-help/templates-and-guides/fact-sheets/rights-
and-obligations/industrial-action#commission.
FWC, (2018). Decision. Retrieved on 5th May 2018 from:
https://www.fwc.gov.au/documents/decisionssigned/html/2017fwc5380.htm.
FWC, (2018). Summer 2018: Quarterly practitioner update. Retrieved on 5th May 2018 from:
https://www.fwc.gov.au/resources/quarterly-practitioner-updates/summer-2018-
quarterly-practitioner-update.
Gahen, P. Pekarek, A. & Nicholson, D. (2018). Unions and collective bargaining in Australia in
2017. Journal of Industrial Relations, Volume 60(3).

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Gellie, C. (2018). 230 day strike ends as Oaky North miners agree to deal. Retrieved on 5th May
2018 from: https://www.townsvillebulletin.com.au/news/230-day-strike-ends-as-oaky-
north-miners-strike-deal/news-story/659e51bf3fe44994b20ff93024e80243.
Glencore, (2018). Glencore rejects CFMEU claims about Oaky North Coal Mine. Retrieved on
5th May 2018 from:
http://www.glencore.com.au/en/media-centre/News/180209_Statement_Glencore-rejects-
CFMEU-claims-about-Oaky-North.pdf.
Kippen, M. (2018). Mine giant wants to terminate enterprise agreement. Retrieved on 5th May
2018 from: https://www.dailymercury.com.au/news/mine-giant-wants-to-terminate-
enterprise-agreement/3323475/.
Stevens, M. (2017) Ballot defeat fails to dent Glencore’s Oaky North resolve. Australian
Financial Review. Retrieved on 5th May 2018 from: www.afr.com/business/glencore-
deadlock-drifting-to-dead-end-20171031-gzbyxk.
Terzon, E. & Robinson, P. (2018). Locked-out Glencore coal miners vow to continue 6-month
picket line. Retrieved on 5th May 2018 from:
http://www.abc.net.au/news/2018-01-25/locked-out-coal-miners-vow-to-continue-6-
month-blockade/9360558.
The Australian, (2018). ALP plan to increase Fair Work power to intervene in disputes.
Retrieved on 5th May 2018 from:
https://www.theaustralian.com.au/national-affairs/industrial-relations/alp-plan-to-
increase-fair-work-power-to-intervene-in-disputes/news-story/
25abb0681b6b4f3625100306d0bf5fb4.