T10377
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TASMANIAN INDUSTRIAL COMMISSION Industrial Relations Act 1984 Construction, Forestry, Mining and Energy Union, and Incat Tasmania Pty Ltd
Industrial dispute - alleged breach of award and alleged illegal compulsory searches of employees' bags by the company - policy not found to be unlawful - policy found to be "reasonable" and does not constitute a unilateral variation to contract of employment - matter discontinued REASONS FOR DECISION [1] On 19 August 2002, the Construction, Forestry, Mining and Energy Union, Tasmanian Branch (CFMEU) applied to the President, pursuant to Section 29(1) of the Industrial Relations Act 1984, for a hearing before a Commissioner in respect of an industrial dispute with Incat Tasmania Pty Ltd arising out of the alleged breach of Clause 31 - Settlement of Disputes of the Shipbuilders Award and alleged illegal compulsory searches of employees' bags by the company. [2] The matter was set down for hearing at the Commonwealth Law Courts, 39-41 Davey Street, Hobart at 9.30am Thursday 26 September 2002. Mr W White, together with Mr M Paton, appeared for the Union. Mr S Carter appeared for Incat. (3) This application concerns a policy introduced by Incat management whereby employees may be subject to bag inspections by security staff on departure from the employer's premises. (4) The application, as amended, reads as follows:
(5) The federally registered Incat Tasmania Pty Ltd Agreement No. 1 of 19971 regulates employment conditions at Incat. The CFMEU is not a party to this Agreement although CFMEU members are bound by its terms. The State Shipbuilders Award also has limited application in certain circumstances. (6) The dispute notification was lodged in both the Australian Industrial Relations Commission and this Commission. Both notifications came before President/Deputy President Leary in a conciliation conference on 26 August 2002. The dispute was not resolved and on 27 August the President issued a written recommendation. The substance of this recommendation was that the bag inspection policy be complied with by all parties pending arbitral proceedings before the Commission as presently constituted. Background (7) On 15 July Legal & Human Resources Manager, Simon Carter, issued a memorandum which said in part:2
(8) Both the AMWU and the CEPU notified the Australian Commission as to the existence of an industrial dispute in relation to the bag search decision. These matters came before Deputy President Leary on 2 August 2002. As a consequence a process of implementation was agreed and communicated to Incat employees. (9) In the instant matter Mr White submitted that the position of AMWU members on site was a long way short of support for the policy. However in the absence of any evidence to the contrary, I must accept the position recorded in the recommendation of Deputy President Leary in the following terms:3
(10) It is this process which has been observed on the site, pending the determination of this application. Submissions of CFMEU (11) Mr White submitted that neither the Award nor the Agreement contained an express power requiring employees to submit to random bag searches. He said of the duties owed by employees to their employer, namely, care and competence, fidelity, confidentiality and a duty to obey the employer's orders, only the latter could conceivably embrace the policy of random bag searches. (12) However on the authority of Laws v London Chronicle Indication Newspapers4, an employee need only comply with an employer's order that is both lawful and reasonable. Mr White said that the bag inspection policy failed on both counts. (13) Mr White submitted that policy had not applied at Incat prior to 16 July 2002, and therefore did not form part of existing contract of employment. The implementation of the policy could only be effected by a variation to the existing contract. If the employees do not consent to the change [which they did not] then any attempt to implement the policy could only be viewed as a unilateral variation, which in turn would lead to a repudiation of the contract of employment. A number of authorities were cited in support of this contention including Marriott v Oxford and District Co-op Society,5 Rigby v Ferodo Limited,6 Penny Pearce v Equitorial Holdings,7 and Beck v Darling Downs Institute of Advanced Education.8 (14) Mr White referred to Beck v Securicor Transport Limited9 as an example of a successful unilateral variation of a contract of employment without acceptance of the other party, but only because an express term of the contract entitled the employer to so vary the contract. (15) Mr White submitted correspondence outlining "in general terms" the view of the Australian Council for Civil Liberties on this issue.10 The position of the Council is summarised by the following extract:
[16] On the matter of consent, the council said:
[17] Mr White said that he had received advice from Tasmania Police supporting the view of the Council for Civil Liberties. He said:11
[18] Mr White asserted that employees had been advised that failure to comply with the policy would result in summary dismissal. This he submitted was a very severe penalty for someone who "by law, must be presumed innocent until proven guilty". Submissions of Incat [19] Evidence was called from Mr Neil Ruut, the provider of security services at Incat for the past 13 years. Mr Ruut's evidence in relation to the implementation of the procedure was:12
[20] And later:13
[21] Mr Carter acknowledged that if an employer seeks to unilaterally vary the contract in respect to a term that goes to the heart of the contract, it would amount to a repudiation of the contract of employment. He said this point was well made in a number of the judgements relied on by Mr White. However the facts in the instant matter can be readily distinguished from those applicable in these authorities. [22] For example, in Marriott, the salary and wage of the employee was reduced without consent. [23] Similarly in Rigby, the employer had imposed a 5% reduction in wages. The fact that the employee continued to work for a time under protest at a reduced wage did not amount to an agreed variation and, it followed, the employee was entitled to damages. [24] In Beck, a senior academic had been offered a position as head of a University faculty. Subsequent to his appointment he was placed in a position of significantly lesser status, without his consent. [25] These judgements, Mr Carter said, dealt with circumstances whereby the employer had attempted to unilaterally vary core terms of the contract of employment, e.g. salary, conditions, status. [26] This instant matter should be distinguished in that it dealt with an issue that was at the periphery of the contract of employment, and/or alternatively, fell within the broad heading of management prerogative. [27] Mr Carter cited Bahonko v Southern Health Care Network14 as an example of the Commission confirming the management prerogative to, in this case, instruct an employee as to how work is to be performed. [28] Mr Carter said that on the evidence, the bag inspection procedure did not interfere with the performance of work or the departure of employees at knock off time. He said:15
[29] Mr Carter referred to the decision of Macken J, dealing with guidelines for retail security.16 This decision established guidelines for a range of security issues in the retail sector. In relation to bag searches, Macken J said:
[30] Mr Carter concluded by indicating that the USA military was likely to constitute a major part of the Incat customer base into the future. Not surprisingly, the military insists on a high level of security, and the bag search policy was an important part of overall security arrangements at Incat. Finding [31] Nothing was put which would lead me to conclude that the procedures in place at Incat are in any way unlawful. Employees who do not wish to participate have the option of not taking their bag on site. This to me is little different in concept to a retail store that clearly advises potential customers that shopping bags may be inspected. [32] Similarly, I do not accept the view of the Council for Civil Liberties that the policy is contrary to the International Covenant on Civil and Political Rights.17 The evidence simply does not support notions of the denial of "the right to liberty of movement" and "arbitrary or unlawful interference with ... privacy, family, home or correspondence". [33] The remaining question is whether or not the process adopted can be fairly described as "reasonable". [34] In this context I concur with Hodder C in McIndoe v BHP Coal18:
[35] If "management prerogative" is to be construed as something that management is able to implement in an unfettered manner, then I do not accept that bag searches per se fall within the category of management prerogative. That is, it is not open to management to implement a bag search policy without consultation and on such terms as management alone considers appropriate. [36] I do not, however, consider that the implementation of a bag search policy amounts to a unilateral variation to the contract of employment. Such a policy is very much at the periphery of the employment contract, and provided it is implemented on a reasonable basis, there should be no barrier to an employer going down this path. [37] Applying this test to the Incat policy, I have reached the following conclusions. [38] The "Procedure and Protocol" document19 clearly complies with the guidelines established by Macken J, in that the employee must be present, or alternatively given permission for such search to take place in his or her absence. In addition, an employee may nominate another person to be present during the search. [39] In terms of practical implementation, the evidence of Mr Ruut was compelling. [40] When a search is conducted, all persons, without exception and including managers and supervisors, leaving the company premises, are subject to the bag inspection. In my view, Mr White's observation that Incat employees are, by implication, regarded as "thieves", is misplaced. [41] On the evidence of Mr Ruut it is clear that employees are not unduly inconvenienced or delayed during a search; indeed most do not even stop. [42] I have reached the conclusion that the Incat protocol is a reasonable one and open to the company to implement. This is not, however, an unfettered right, and in the happy event that employee numbers increase, care will need to be taken to ensure that the practical implementation, as explained by Mr Ruut, remains on foot with minimal inconvenience to employees. [43] Pursuant to Section 21[2][c], these proceedings are discontinued. I so Order.
Tim Abey Appearances: Date and Place of Hearing: 1 P9795 |