Nz Professional Firefighters Union v Nz Fire Service Commission Coa

• Jurisdiction: New Zealand
• Judge: Glazebrook J
• Judgment Date: 29 November 2011
• Neutral Citation: [2011] NZCA 595
• Docket Number: CA439/2011
• Court: Court of Appeal
• Date: 29 November 2011

BETWEEN

New Zealand Professional Firefighters Union

Appellant

and

New Zealand Fire Service Commission

Respondent

[2011] NZCA 595

Court:

O'Regan P, Glazebrook and Wild JJ

CA439/2011

CA481/2011

IN THE COURT OF APPEAL OF NEW ZEALAND

Appeal against Employment Court's (“EC”) decision to grant compliance order which delayed otherwise lawful strike action — appellant and respondent could not reach an agreement on collective bargaining (“BPA”) — Union issued notices of intention to strike — employer sought compliance order requiring Union to comply with provisions of BPA — EC issued compliance order and ordered Union to cease acting forthwith in reliance on notices of strike action — whether EC had power by way of compliance orders to order union not to undertake strike action — whether granting of compliance orders was precluded by s85 Employment Relations Act 2000 effect of lawful strike or lockout in relation to lawful proposed strike action.

Counsel:

P Cranney and A Connor for Appellant

G C Davenport for Respondent

• A The application for leave to appeal is granted. Leave to appeal is granted on the two questions of law set out at D below.

• B Leave to appeal is granted in relation to the subsidiary issue of whether the granting of compliance orders is precluded by s 85 of the Employment Relations Act 2000 in relation to lawful proposed strike action. Leave to appeal is declined in relation to all other subsidiary issues.

• C Costs on the application are to lie where they fall.

• D The appeal is allowed. The questions of law are answered as follows:

  Question 1: Was the Employment Court right to hold that it had power by way of compliance order to order the Union and its members not to undertake strike action pursuant to notices of strike action issued on 16 and 30 June 2011 (the proposed strike action)?

  Answer: No.

  Question 2: Was the Employment Court right to hold that, even if it had no power to issue an injunction or a compliance order, it nonetheless had the power to prevent the proposed strike action?

  Answer: No.

• E Costs for a standard appeal on a band A basis and usual disbursements are awarded to the appellant on the appeal.

REASONS OF THE COURT

(Given by Glazebrook J)

Table of Contents

	Para No
Introduction	[1]
Background	[2]
The Employment Court decision	[8]
Aftermath of Employment Court decision	[16]
Grounds of proposed appeal	[17]
Union's position	[19]
Commission's position	[20]
Leave to appeal	[26]
The appeal	[33]
Result and costs	[45]
Appendix: the legislation	[49]

Introduction

1 The New Zealand Professional Firefighters Union (the Union) seeks leave to appeal against a decision of the Employment Court. 1 The proposed appeal concerns whether a compliance order should have been made against the Union and its members which had the effect of delaying otherwise lawful strike action.

Background

2 In December 2010 the New Zealand Fire Service Commission (the Commission) and the Union agreed on a process for collective bargaining (the Bargaining Process Agreement or the BPA). The relevant parts of the BPA, signed by the parties' representatives, include the following clauses:

4. BARGAINING PRINCIPLES

Bargaining will be undertaken in good faith. The parties to the bargaining commit:

• (a) To conducting the bargaining in an orderly, effective and efficient manner, and in accordance with this Agreement.

• …

• (i) To not undermining or doing anything that is likely to undermine the bargaining, or the authority of the other party to the bargaining.

• …

10. PROCESS TO APPLY WHERE AGREEMENT CANNOT BE REACHED

• (a) If agreement cannot be reached in the course of bargaining the parties will discuss ways to address this, including consideration of the extent to which setting aside the point of disagreement could still leave the parties with an overall settlement agreement sufficient to meet their joint interests.

• (b) If bargaining ceases to make progress then the parties will, prior to giving notice of, or taking, industrial action, attend mediation providing that the mediation can occur within a reasonable timeframe (a reasonable timeframe would

  normally be considered to be 14 days). The parties will agree on the mediation service and mediator to be used, and on the issues to be discussed.

• …

11. APPLICATION OF THIS AGREED PROCESS FOR COLLECTIVE BARGAINING

• (a) This agreed process shall bind the parties to this agreement.

• (b) Where a party believes there has been or may be a breach of this agreed process or of the obligations of good faith set out in the Employment Relations Act, or any applicable Code of Good Faith issued pursuant to the Act, the party shall, wherever practicable, notify the other party of their concerns at an early stage so as to enable the defaulting party to remedy the situation or provide an explanation for the action or inaction in question.

• …

3 By May 2011, the parties had not reached a collective agreement. It was thus agreed that the Commission's proposed collective agreement would be put by the Union to a vote of its members. The Commission's draft collective agreement was rejected by the members, the results of the vote being announced on 14 June 2011.

4 On 16 June 2011, the Union issued notices of intention to strike, the strike to occur on 1 July 2011. The Commission requested withdrawal of the notice so that mediation could occur. It contended that mediation was required under cl 10(b) of the BPA before a strike notice could be issued. The Commission threatened interim injunction proceedings.

5 The Union reacted by filing proceedings on 17 June 2011 before the Employment Relations Authority (the Authority) for a determination that the proposed strike was lawful. These proceedings were removed to the Employment Court.

6 After a directions conference in the Employment Court, mediation between the parties occurred on 23 and 30 June 2011 but the 16 June strike notices were not withdrawn (the strike that was intended to commence on 1 July 2011 did not,however, go ahead). Further strike notices were issued on 30 June 2011, with the intended strike to commence on 16 July 2011.

7 The Commission filed a counterclaim in the Employment Court on 4 July 2011 seeking declarations of illegality and an injunction restraining the strikes. During the hearing on 5 July 2011 in the Employment Court, the Commission sought and obtained leave to amend the counterclaim to seek a compliance order requiring the Union and its members to comply with the BPA.

The Employment Court decision

8 Chief Judge Colgan defined the case as turning on whether members of the Union were entitled in law to begin strike action by giving statutory notice of it without first having attempted to settle new terms and conditions of employment in mediation. In his view, the case focused on the content and effect of the BPA, a statutorily recognised document. 2

9 As to the interpretation of the BPA, Chief Judge Colgan said that “by use of equivocal, even confusing, language, the parties (primarily the Commission whose drafting this was) have made [the crucial issue of the timing of mediation] unclear”. 3 The Chief Judge, however, determined that the intention of cl 10(b) 4 was that, after bargaining ceases to make progress and before a party gives a statutorily-required notice of strike or lockout, it must attend mediation with the other to attempt, in good faith, to settle their differences in the bargaining.

10 The Chief Judge rejected the Union's argument that, if strike action is lawful as defined by the Act, the Court cannot prohibit its occurrence. In its argument before the Court, the Union relied on the express provisions of ss 85, 99 and 100 of the Act. 5 The Chief Judge held that s 99 is inapplicable because the proceeding, in both the claims and counterclaims, was not founded on a tort as required by s 99(3). He also considered that s 100(3) was not engaged, at least in respect of the

Commission's claims to a compliance order. Section 85(1)(c) refers to actions or proceedings including compliance orders being unavailable where there is lawful participation in a strike or lockout, but the Chief Judge considered that this was also inapplicable because the proceeding addressed notice of strike action which is not the same as a strike, 6 and there had not yet been “participation in a strike” as s 85 requires

11 Even if, contrary to his conclusions, any or all of these sections applied to the proceedings before the Court, the Chief Judge did not consider that these provisions should be interpreted so as to bar a remedy in this case. He said that it would run counter to the scheme of the Act to permit a union (or an employer in respect of a lockout) to act egregiously in bad faith and in breach of its solemn commitments to act in good faith in respect of the bargaining and/or strike or lockout action. The Chief Judge referred to a number of sections in the Act which he considered, individually and together, emphasised and promoted the benefits of mediation in collective bargaining and in parties themselves determining how problems are to be addressed. 7

12 The Chief Judge considered that the issues in the case should be viewed as ones of collective bargaining conduct rather than assessed through a strike legality lens. Looked at in this manner, he held that the parties' agreement about how difficulties in collective bargaining were to be addressed was enforceable by way of a compliance order. He said, “it is not a case of constraining a right to strike but, rather, holding parties to their agreement that this right will be postponed for a period in the interests of good faith dealing and for the better prospect of achieving a collective agreement”. 8

13 The Chief Judge considered that a compliance...