JurisdictionNew Zealand
CourtEmployment Court
JudgeChief Judge
Judgment Date14 April 2011
Docket NumberARC 18/11
Date14 April 2011

[2011] NZEmpC 33



Chief Judge G L Colgan, Judge B S Travis Judge A A Couch

ARC 18/11

In the Matter of Proceedings Removed from the Employment Relations Authority

Tertiary Education Union
Chief Executive, Western Institute of Technology
First Defendant


Chief Executive, Unitec New Zealand
Second Defendant


Chief Executive, Whitireia Community Polytechnic
Third Defendant


Chief Executive, Northland Polytechnic
Fourth Defendant


Chief Executive, Bay of Plenty Polytechnic
Fifth Defendant


Chief Executive, Waikato Institute of Technology
Sixth Defendant

Peter Cranney, counsel for plaintiff

Sherridan Cook and Aaron Harlowe, counsel for defendant

Application for a determination of whether the re-initiation of bargaining with the defendant tertiary institutions after union members voted against a multi-party collective agreement was proper — defendant initiated bargaining for a multi-employer collective agreement under s42 Employment Relations Act 2000 (how bargaining initiated) — plaintiff subsequently conducted a secret ballot of its members under s46(b) (terms of question for secret ballot) — union members voted for single collective agreements — the plaintiff initiated single-collective bargaining on the basis that the initial bargaining had come to an end as a result of the secret ballot — whether the plaintiff was required to continue to bargain for a multi-employer collective agreement — whether the plaintiff's initiation of single bargaining was an unlawful cross initiation of bargaining — test case under s47 (when secret ballots required after employer initiates bargaining for single collective agreement).

Held: Section 47(6) ERA did not provide for the consequence of a negative ballot; it only provided for what could occur after a positive vote, that being that continuation of the collective bargaining as initiated. Therefore the context must be used to determine the meaning and purpose. Although employers were entitled to initiate bargaining for a collective agreement with a union, there were important statutory constraints upon their doing so. Various provisions in ss 41, 45 and 47 showed that unions were deliberately advantaged in the collective bargaining scheme in some respects. Union members had unique rights to control bargaining for a multi-party collective agreement. Section 47 ERA provided for the views of union members to influence employer initiated bargaining.

Section 47(6) ERA (bargaining may continue where secret ballot in favour) had to be construed in a manner consistent with the objects of Part 5 ERA (collective bargaining) and with the related provisions of s45 ERA which were consistent with those objects. On that basis, where bargaining was initiated by one or more employers for a multi-party collective agreement, the effect of s47(6) ERA was that bargaining could only continue to the extent that the union considered its members to be in favour of the bargaining. The object of this part of the Act was set out in s31(e), which was to ensure that employees confirmed “proposed collective bargaining for a multi party collective agreement”. Where there had been no positive confirmation of any such bargaining, no bargaining could continue unless and until re-initiated.

That construction also gave effect to the object of orderly bargaining in s31(d) ERA (object of Part 5 — orderly collective bargaining). If the parties were allowed to continue bargaining for an outcome other than a single collective agreement, any permissible agreement would involve fewer than all of the parties.

The parties were precluded from any further bargaining at the initiation of the defendants. The subsequent initiation of bargaining by the Union with each of the defendants promoted orderly bargaining and was not an unlawful counter-initiation of bargaining.


This judgment interprets and applies for the first time in this Court the law relating to collective bargaining where affected employees do not wish to bargain for a single collective agreement with a group of employers. The proceeding, which needs to be decided urgently because collective bargaining is stalled, was removed for hearing in this Court by the Employment Relations Authority under s 178 of the Employment Relations Act 2000 (the Act) on 9 March 2011. 1


The relevant uncontroversial facts can be stated quite shortly. The Tertiary Education Union (the Union) represents employees of six defendant polytechnics and institutes of technology (ITPs) in the North Island. Since 18 March 2004 the Union or its predecessors and the six defendants have been parties to a series of multi-employer collective agreements (mecas), the last of which came into force on 1 June 2010 and expired on 30 November 2010.


On 7 December 2010 the six ITPs collectively initiated bargaining for a single meca by giving notice to this effect under s 42 of the Act. As bargaining was initiated by the defendants after the expiry of the former meca, their initiation notice did not have the effect of extending the term of the expired meca under s 53 of the Act.


The Union believed that its members at the six ITPs would not wish to be covered by a single collective agreement and accordingly conducted secret ballots of its members at those institutions under s 46(b) of the Act to determine whether the members favoured bargaining for a single collective agreement with the named employers. The question voted on was that referred to in s 46(b), “whether the [union] member is in favour of bargaining for a single collective agreement with [the six ITPs]” although not in those precise words. No issue is taken with the adequacy of the ballot's question under s 46(b).


A majority of members at all six ITPs voted against a single multi employer agreement and, on 11 February 2011, the Union both advised the individual ITPs of that outcome and purported to initiate bargaining for single collective agreements (secas) between itself and each of the individual ITPs. The Union did so on the basis that the bargaining initiated by the ITPs collectively on 7 December 2011 had come to an end as a result of the outcome of those secret ballots and that the Union was then free in law to initiate bargaining with each of the ITPs individually.


The ITPs collectively disagreed, claimed that the Union was obliged to continue to bargain with them and asserted that the purported initiation of bargaining by the Union with each of them individually was an unlawful cross initiation of bargaining. All collective bargaining has ceased pending a resolution of the legal position in these proceedings.

Section 47(6) of the Act

The section of the Act at the heart of this case is s 47 and, in particular, subs (6) of that section. The material parts of s 47(6) (with our underlined emphases) are:

47 When secret ballots required after employer initiates bargaining for single collective agreement

  • (1) This section applies to-

    • (b) 1 or more unions in relation to which 2 or more employers have initiated bargaining for a single collective agreement.

  • (6) At the conclusion of the secret ballots, bargaining for a singlecollective agreement may continue,—

  • (b) where subsection (1)(b) applies, if the members of the union

    • (i) have voted in favour of bargaining for a single collective agreement with the 2 or more employers; or

    • (ii) are considered by the union or each union, as the case may be, to be in favour of bargaining for a single collective agreement with the 2 or more employers; or

    • (iii) both.


While it is immediately clear from s 47(6) what the consequence of a ballot in favour of bargaining for a single meca is to be, the subsection does not provide explicitly for the consequence of a negative ballot. We must therefore ascertain the meaning and effect of s 47(6) in that context.


The starting point must be section 5 of the Interpretation Act 1999 which provides:

5 Ascertaining meaning of legislation

  • (1) The meaning of an enactment must be ascertained from its text and in the light of its purpose.

  • (2) The matters that may be considered in ascertaining the meaning of an enactment include the indications provided in the enactment.

  • (3) Examples of those indications are preambles, the analysis, a table of contents, headings to Parts and sections, marginal notes, diagrams, graphics, examples and explanatory material, and the organisation and format of the enactment.


In applying that provision, we also have regard to what the Supreme Court (Tipping J) said in Commerce Commission v Fonterra Co-operative Group Ltd: 2

    It is necessary to bear in mind that s 5 of the Interpretation Act 1999 makes text and purpose the key drivers of statutory interpretation. The meaning of an enactment must be ascertained from its text and in the light of its purpose. Even if the meaning of the text may appear plain in isolation of purpose, that meaning should always be cross checked against purpose in order to observe the dual requirements of s 5. In determining purpose the court must obviously have regard to both the immediate and the general legislative context. Of relevance too may be the social, commercial or other objective of the enactment. … [24] Where, as here, the meaning is not clear on the face of the legislation, the court will regard context and purpose as essential guides to meaning. …
Collective bargaining initiation – the scheme of the legislation

As with other provisions of the Act relating to the process of collective bargaining, those parts of the statute governing its initiation do not apply equally to unions (and their members) and employers. Unions and their members are deliberately advantaged in some respects and employers restricted in others.

Although employers are entitled to...

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