‘Super Union’ Merger to Bolster Union Powers

By Andrew Wallis, Partner, Andrew Chegwidden, Senior Associate and Marcelle Chester, Lawyer

The Fair Work Commission has permitted an application under section 44 of the Fair Work (Registered Organisations) Act 2009 (Cth) for the amalgamation of three industry unions; the Construction Forestry, Mining and Energy Union (CFMEU), the Textile Clothing and Footwear Union of Australia and the Maritime Union of Australia (MUA). The new ‘super union’, known as the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU), became effective on 27 March 2018.

The CFMMEU now has a membership that makes up 1% of the Australian workforce (approximately 144,000 members) with combined assets of $310 million and annual revenue of approximately $146 million. While the CFMMEU national secretary Michael O’Connor has said the new ‘super union’ will hit the ground running and work to address the inequities between big business and working families, the CFMMEU now has a monopoly over these industries’ supply chains.

As a result of the amalgamation, the CFMMEU is likely to have greater resources to pursue industrial action, mobilise union members and pay penalties imposed by the Industrial Relations Commission.  Whilst the CFMMEU’s increased resources and membership representation may lead to greater efforts to protect employees’ rights, it also may lead to significant disruptions to businesses in the construction industry.

Denita Wawn, chief executive of the Master Builders’ Association (MBA) has said that the CFMEU’s history of unlawful industrial action will “see these illegal tactics become more prevalent, giving them even greater power to coerce business, put jobs at risk and bring the economy to a standstill.” The CFMEU has previously been fined millions of dollars for breaches of workplace laws, including $1.8 million during the last financial year and is currently facing approximately $4 million in fines during this financial year (approximately $2.7 million of which is currently under appeal).

Union powers

One of the major powers afforded to union officials under the Fair Work Act 2009 (Cth) is the right of entry. Employers would be wise to re-familiarise themselves with the powers of union officials to investigate a suspected contravention of a workplace law or regulation on a construction site. In summary, union officials have two main rights to enter premises:

  • for the purpose of investigating a suspected contravention of the Fair Work Act; and
  • to hold discussions in non-working time with employees whom the union is entitled to represent, if those employees wish to participate in the discussions.

Principals and contractors should be aware that union officials when investigating a suspected contravention also have the right to:

  1. inspect any work, process or object relevant to a suspected breach;
  2. interview any person about a suspected breach who agrees to be interviewed and whom the union is entitled to represent;
  3. inspect and make copies of records of union members that are directly relevant to the suspected contravention and that are kept on the site or are accessible on a computer kept on the site;
  4. inspect and make copies of any record of a person who is not a union member that is directly relevant to the suspected contravention and that is kept on the site or accessible on a computer kept on the site, provided that the non-member has consented in writing or an order has been made by the Fair Work Commission;
  5. serve a notice on the employer to produce records or documents at a later date;
  6. use the employees’ regular meal room to hold discussions or interviews; and
  7. exercise these rights without being hindered or obstructed.

Employers and site occupiers should note that they do have the right, prior to permitting the union official entry to investigate suspected contraventions, to request to see its ‘entry notice’ – this notice must comply with all the requirements of the Fair Work Act and must identify the particulars of the suspected contraventions which the union official will be investigating.

Will the merger last?

The Turnbull government committed in 2016 to passing laws requiring amalgamations such as the CFMMEU merger to be subject a public interest test. This legislation was never scheduled for a vote in the Senate, and by March 2018 the Fair Work Commission proceeded to permit the merger.

The Minister for Small and Family Business, the Workplace and Deregulation (Craig Laundy), recently said that the Government has not ruled out the possibility of the promised legislation having a retrospective effect. In the meantime, the MBA and the Australian Mines and Metals Association (AMMA) have appealed the merger approval to the full bench of the Fair Work Commission, arguing that a merger can only be approved under the Fair Work (Registered Organisations) Act 2009 (Cth) if there are no criminal proceedings on foot. The success of the appeal, however, may be elusive in light of the Fair Work Commission’s deputy president’s rejection of AMMA’s and MBA’s argument that contempt and industrial penalty proceedings currently on foot against the MUA over its recent blockade at the Port of Melbourne constitute criminal proceedings which would prevent such a merger under the Fair Work Act.

If the appeal to the full bench of the Fair Work Commission is successful, we intend to issue a separate alert to keep you updated on the key developments in this space.

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

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