A significant judgment about employers’ obligations of consultation
In a significant judgment given last week, in Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2016] FCA 1009, the Federal Court dismissed a union’s criticisms of a process of consultation, and in doing so made three points of general importance about employers’ obligations to consult about workplace changes.
An enterprise agreement required the employer to consult with employees and their representatives about proposed redundancies.
‘Consultation’ was defined to involve ‘a genuine opportunity to influence and inform the decision making process over a significant and important issue.’
The first point of interest was the Court’s conclusion that ‘[t]here is no fixed format for consultation.’ ‘In many, if not most, cases, a meeting may well be an essential feature of consultation. But in the absence of some particular prescription in an industrial instrument, that will be because good industrial relations practice and, as ought not to be any different, ordinary experience of life as to the benefits of the spontaneity and flexibility of communication which a face-to-face meeting offers, make it so… In some cases, perhaps, an exchange of emails might suffice… What is essential is that it is apparent from all of the circumstances that the requisite opportunity genuinely has been extended.’
Second, the Court held that there is no general requirement that the employer’s decision maker participate directly in the consultation. ‘For a corporation, the decision-making “process” may be the resolution of a board of directors. The members of that board could, collectively, if they wished, represent the company in the consultation at a meeting held for that purpose. Equally, the corporation could be represented at a meeting held for that purpose by one or more of its officers or employees.’ Perhaps if a corporation was represented by a junior officer who was ignorant of the issues, ‘at the very least an interrogative note might have been raised about whether it had set out to afford a genuine opportunity to consult or any opportunity at all.’ But in this case, the employer was represented at meetings and in correspondence by a senior employee who, the Court found, was well-informed, and ‘well-disposed and receptive to being influenced and informed and, to the extent matters lay beyond his remit, to ensuring that any other corporate decision-makers within BHP Coal or BMA were, via him, informed and influenced by what was raised.’ The Court particularly approved a particular aspect of that employee’s evidence, giving what might be taken as a textbook definition of what consultation really requires of an employer: ‘We were after ideas, thoughts and proposals.’
Third, the Court made some important observations about the content of an obligation to consult. ‘[T]he obligation to consult does not carry with it any obligation either to seek or to reach agreement on the subject for consultation. Consultation is not an exercise in collaborative decision-making.’ And, consultation ‘entails furnishing such information about the occasion for consultation as is reasonably necessary for the making of suggestions in respect of the subject for consultation and being receptive to any resultant suggestions. It does not mean that one cannot approach consultation with a particular outcome in mind, only that one’s mind not be unduly fixed.’
