Unite Union Inc. v Skycity Auckland Ltd

JurisdictionNew Zealand
CourtEmployment Court
JudgeB S Travis
Judgment Date14 February 2011
Docket NumberARC 8/11
Date14 February 2011

[2011] NZEmpC 12


ARC 8/11

In the Matter of an injunction

Andunite Union Inc
First Plaintiff


Candy Sherman
Second Plaintiff
Skycity Auckland Ltd

Helen White, counsel for plaintiff

Richard McIlraith and Kylie Dunn, counsel for defendant

Application for a substantive injunction to prevent threatened lockouts by the defendant and damages for loss of wages. Plaintiff was a union under the Employment Relations Act 2000 and party to a collective agreement which had expired. Bargaining for a new agreement failed and various strike actions were initiated. Defendant commenced lockouts against employees engaging in short duration strikes, presenting them with lockout notices which stated the purpose was to compel them to accept the proposed collective agreement and proposed pay increase — whether or not the defendant's actions, or threatened actions, amounted to an unlawful lockout.

Held: Section 86 ERA defined a lockout as unlawful if it related to a personal grievance or a dispute. Because the lockout was in response to a strike which related to collective bargaining, it was lawful under s83 ERA (lawful strikes and lockouts related to collective bargaining). The Court of Appeal in Spotless Services (NZ) Ltd v Service and Food Workers Union Nga Ringa Tota Inc (No 2) confirmed the importance of the dominant motive test and whether that motive was to further the collective bargaining. Under Spotless, a lockout could be unlawful because s83 and s84 (lawful strikes/lockouts on grounds of safety or health) ERA could not be interpreted or allow any person to act in a manner that was contrary to the ERA. If the true motive was to merely prevent disruption and there was no power under the agreement to send people home when they had taken short duration strike action, then it would be contrary to the ERA and the Court of Appeal's interpretation of s83 and s86 (unlawful strikes or lockouts) ERA in Spotless, and would be unlawful.

It was clear that the intention of the lockouts was to further the bargaining by stressing the demand to accept SkyCity's pay offer, the key dispute issue. The effect was also to reduce the disruption caused by the short duration strikes but this was acceptable provided the action fell within the definition of lawful strikes and lockouts.

Application dismissed.



The first plaintiff (“Unite”) and the second plaintiff are seeking a substantive injunction to stop and prevent threatened lockouts by the defendant (“SkyCity”) which they claim are unlawful. They also seek damages for loss of wages caused by what they claim to have been the same unlawful acts.


As a substantive injunction is being sought, the principles that apply to interim injunction applications, such as establishing an arguable case and determining the balance of convenience, do not apply. The parties agreed to bring this matter on urgently for a substantive hearing in which the relatively uncontroversial facts would be applied to the law to ascertain whether or not the defendNZEmpCctions, or threatened actions, amounted to an unlawful lockout.


The Chief Judge, in a minute following a telephone conference callover held on 3 February 2011, determined that affidavit evidence would be the basis of the substantive hearing and if any deponent was required for cross-examination, notice of that intention should be given and copied to the Court as soon as possible. In the event Ms White, counsel for the plaintiffs indicated at the commencement of the hearing that she wished to cross-examine the deponent of the sole affidavit filed by the defendant, Claire Walker, SkyCity's Employee Relations Manager. This was opposed on the basis that no notice had been given and Ms White then withdrew her application.


During his final submissions Mr McIlraith, on behalf of the defendant, advised the Court that as he saw the plaintiffs' case developing it amounted, in substantial part, to an attack on Ms Walker's credibility and, as she was present in Court, he offered to make her available for cross-examination notwithstanding the lack of earlier notice. Ms White took instructions and sought the opportunity to cross-examine Ms Walker who was then called for that purpose. The viva voce evidence she gave will form part of my factual findings.

Factual findings

Except where otherwise indicated these findings are based on admitted allegations in the pleadings and unchallenged affidavit evidence.


Unite is a union registered under Part 4 of the Employment Relations Act 2000 (the ERA). The second plaintiff is a member of the first plaintiff and an employee of SkyCity. SkyCity owns and operates a casino, several restaurants and bars, a hotel and a convention centre in Auckland. It employs approximately 3,300 employees across its Auckland Operations. Unite has between 750 and 800 members who are employees of SkyCity. The Service and Food Workers Union Nga Ringa Tota Inc (the SFWU) also has between 280 and 300 members employed by SkyCity. The SFWU was served with the pleadings and although it says its members are affected by the defendant's actions and that it supports the plaintiffs' position, it does not wish to seek leave to appear or be represented and was content to abide by the Court's decision.


Unite and SFWU were parties to a collective agreement which expired on 31 December 2010 (the CA). It covered all waged and many salaried employees who were members of either union, employed at SkyCity's Auckland site, This included the second plaintiff, Candy Sherman, a supervisor and a dealer in what is described as the “Table Games” area. The unions initiated bargaining for a new collective agreement on 10 November 2010 and the first bargaining meeting took place on Monday 15 November. Three managers, including Ms Walker, attended that meeting on behalf of SkyCity. At that stage the unions had a bargaining team of approximately 14 which included Ms Sherman.


The uncontroverted evidence is that, although the union bargaining team contained people from various areas across SkyCity, the majority of its members worked in Table Games. The union team included four union officials who were not SkyCity employees, eight representatives from Table Games, one representative each from the property solutions department, the finance department and the security department. There were no representatives from housekeeping, cleaning services or the gaining machines department all of which included a large number of union members.


Michael Treen, the National Director of Unite, was the senior member of the union bargaining team and has provided an affidavit in support of the plaintiffs' application, According to Ms Walker's uncontradicted evidence at the first bargaining meeting, Mr Treen stated that they should schedule a mediation for early December as the unions intended to take industrial action on 1 January 2011, one of SkyCity's busiest days. The negotiating teams continued to meet approximately weekly for the remainder of the year.


The unions and their members commenced strike action from 12.30am on 1 January 2011, some 30 minutes after the collective agreement expired. This took the form of meetings of union members which were scheduled for two hours, at 4.30am, 8.30am and 12.30pm. Some 259 employees participated in strike action from 1 January although many were on strike for less than two hours. On each occasion it was predominately employees from Table Games who participated in the strike action. They were accompanied by a picket of Unite officials.


The strikes of the members of the unions working in Table Games occurred on every shift after 1 January although the number of employees taking strike action and the length of the strikes fluctuated. On some occasions, Table Games employees were on strike for as little as 15 minutes, some were on strike for a longer period of time. The Table Games employees did not advise managers how long they would be on strike for each occasion and this created significant inconvenience for those managers. These strikes of the Table Games employees have become known as the “short duration strikes”.


Throughout the period since 1 January there have been employees in departments other than Table Games who have taken different types of strike action, but Ms Walker claims that the strike action has been largely limited to Table Games. She compiled a table which summarised the strike action from 1 to 28 January 2011 across various areas at SkyCity, which shows that 465 employees have participated in strike action at least once since 1 January and of those, 352 were from Table Games,


Ms Walker has accepted that Mr Treen has been “very upfront” throughout, regarding the strike action. He had indicated the strikes would commence on 1 January at the first November meeting. He also referred to targeting the Chinese New Year period, which is 2-17 February 2011 and the Rugby World Cup period between 9 September until 23 October. These are expected to be two of SkyCity's busiest times. Ms Walker has expressed her wish that the collective agreement had been settled prior to Christmas to avoid the 1 January strike and the hopeful wish that a new collective agreement would be negotiated well before September 2011,


There has been only one meeting for collective bargaining so far this year, on 21 January. SkyCity put forward an offer of a three percent increase in pay rates for each of the next three years. The offer was rejected by the unions. The unions have not advised why SkyCity's offer was rejected or what they would be prepared to accept in its place.


At the 21 January meeting Ms Walker asked that as the strike action had been largely limited to Table Games, were there issues specific to those employees which could be discussed? Mr Treen...

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