Fair Work Commission suspends Svitzer’s proposed lockout of employees

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By Dr Laura Sowden, Partner and Annabel Cheung, Law Graduate

On 18 November 2022, the full bench of the Fair Work Commission (FWC) suspended protected industrial action for six months as it threatened to endanger Australian welfare and cause significant economic damage.

Situation

On 14 November 2022, Svitzer Australia Pty Ltd (Svitzer) gave notice to the bargaining representatives pursuant to s 414(5) of the Fair Work Act 2009 (Cth) (FWA) of employer response action.

Svitzer proposed an indefinite lockout of all harbour towage employees covered by the Svitzer Australia Pty Ltd National Towage Enterprise Agreement 2016 commencing at 12:00 pm AEDT on 18 November 2022.

As a result of this notice, on its own initiative the FWC considered making an order under s 424(1) of the FWA to suspend or terminate the industrial action by Svitzer. These orders are typically made where they are judged to be threatening life or safety or inflicting significant economic damage.

Background

Svitzer is a leading marine harbour towage company and is the largest Australian employer of seafarers, employing approximately 580 masters, engineers and ratings to operate 52 tugboats in and out of 17 Australian ports across the country.

The Svitzer statement noted that Svitzer had been bargaining for more than three years for a replacement agreement with three unions and the lockout notice was in response to ongoing industrial action that had made it difficult for Svitzer to continue its operations. Svitzer noted that this response was a matter of necessity.[1]

What happened?

A hearing was conducted on 17 November 2022 where a full bench of the FWC comprising of Vice President Hatcher, Deputy President Cross and Deputy President Eastern heard evidence and submissions of the bargaining representatives, the Minister and other interested parties.

The full bench made the following findings:[2]

  1. Svitzer’s intended lockout of its employees constituted protected industrial action that is threatened, impending or probable;
  2. Svitzer’s intended lockout threatened to endanger the welfare of the Australian population or part of it; and
  3. Svitzer’s intended lockout threatened to cause significant damage to the Australian economy.

It was effectively found by the full bench that s 424 of the FWA was engaged and this meant it could order to suspend or terminate the industrial action proposed by Svitzer.

What does it mean?

In light of the findings on Friday 18 November 2022, the FWC ordered that the industrial action by Svitzer to lock out employees is suspended for six months until 11:00am AEST on 18 May 2023.[3]

The effect of this is that no party will be able to take protected industrial action for the period of the suspension.

This should provide some certainty to interested parties about the potential disruption of industrial action in shipping and logistics arrangements until 18 May 2023.

[1] https://www.workplaceexpress.com.au/files/2022/15Svitzer.pdf

[2] https://www.fwc.gov.au/documents/sites/svitzer-industrial-action/b2022-1726-decision-2022-fwcfb-209-2022-11-18.pdf

[3] https://www.fwc.gov.au/documents/sites/svitzer-industrial-action/b2022-1726-order-pr748042-2022-11-18.pdf

For further information, please do not hesitate to contact us.

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