| Restrictions | OK |
|---|---|
| Jurisdiction | Employment Relations Authority - Christchurch |
| Reference No | [2013] NZERA Christchurch 41 |
| Hearing date | 4 Oct 2012 |
| Determination date | 28 February 2013 |
| Member | C Hickey |
| Representation | T Oldfield, C McNamara ; B Dorking |
| Location | Dunedin |
| Parties | Service and Food Workers' Union Nga Ringa Tota Inc and Anor v Pact Group |
| Other Parties | The Public Service Association Te Pukenga Here Tikanga Mahi Inc |
| Summary | BARGAINING – PENALTY - Applicants sought penalty against respondent for alleged breach of multi-union collective employment agreement (“MUCA”) and sought Authority direction that parties attend mediation if found respondent had conferred prohibited preference on non-union employees – Authority found two per cent wage increase offered to non-union employees was term of MUCA automatically passed on and in breach of MUCA – Found respondent’s breach not deliberate as based on past practices and respondent failed to consider whether had breached MUCA - $5,000 penalty appropriate – Found greater amount of backpay conferred on non-union employees was prohibited preference and conferred because non-union employees not members of applicants – Found respondent’s agreement with non-union employees that two per cent wage increase would be backdated to earlier date of no effect as amounted to prohibited preference - Parties directed to mediation to resolve how non-union employees should be treated – GOOD FAITH – PENALTY – Applicants sought penalty against respondent for alleged breach of good faith obligations - Found respondent not offering during MUCA bargaining to backdate wage increase to same date subsequently offered to non-union employees was lawful bargaining tactic and not in breach of good faith obligations – Found however respondent knew during MUCA bargaining what would offer non-union employees and breached good faith obligations under s4(1)(b) and s4(1A)(b) Employment Relations Act 2000 by withholding information that misled applicants – Found respondent’s failure to disclose what intended to offer to non-union employees deliberate, serious and sustained - $5,000 penalty appropriate |
| Abstract | Applicants sought penalty against respondent for alleged breach of multi-union collective employment agreement (“MUCA”), good faith obligations and sought Authority direction that parties attend mediation if found respondent had conferred prohibited preference on non-union employees. Applicants initiated bargaining for new MUCA seeking wage increase for members. First applicant’s organiser claimed led to believe respondent constrained by government funding and two per cent wage increase effective from date of parties’ agreement all respondent could offer applicants at time. Parties subsequently agreed to two per cent wage increase effective from date of agreement. Respondent offered non-union members two per cent wage increase backdated to date four months earlier than date two per cent wage increase applied to union members. MUCA contained clause that respondent not to “automatically pass on” same terms and conditions of MUCA to non-union employees although respondent could genuinely bargain with non-union employees for individual employment agreements. Applicants claimed respondent could not grant non-union members annual wage increase not linked to employees’ performance, respondent gave non-union employees preference in breach of s9 Employment Relations Act 2000 (“ERA”) and respondent breached good faith obligations as dealt with applicants in misleading and deceptive manner during bargaining. Applicants claimed respondent told some union members would receive greater pay increase if were not union members. Respondent claimed dealt with applicants in good faith and entitled to give non-union members annual pay increase over and above performance-related increases. Respondent claimed given number of employees at respondent could not bargain with each employee individually and wage increase not automatic as not all non-union employees signed new agreement. Respondent claimed when bargaining with applicants had always intended to backdate wage increase for non-union employees from date four months before reached agreement with applicants but up to unions to request backdated wages for members to date prior to agreement.;AUTHORITY FOUND:;BARGAINING - PENALTY: Respondent entitled to pay non-union employees annual pay increase not linked to employees’ performance. Noted MUCA stated new term of independent employment agreement must be passed on through genuine bargaining “entirely separate and independent of collective bargaining.” Factors, including that respondent’s offer to non-union employees was for same increase, offer one month after MUCA concluded and respondent’s acknowledgement always tended to offer non-union employees increase agreed to in collective bargaining process, indicated that offer to non-union employees was not independent of MUCA. Two per cent wage increase offered to non-union employees automatically passed on in breach of MUCA. Respondent’s breach not so much deliberate as based on past practices and respondent failed to consider whether had breached MUCA. $5,000 penalty appropriate. Greater amount of backpay was preference conferred on non-union employees. Respondent conferred prohibited preference on non-union employees because non-union employees not members of applicants. Noted did not consider respondent intended to undermine MUCA. Respondent’s agreement with non-union employees that two per cent wage increase would be backdated to earlier date of no effect as amounted to prohibited preference. Parties directed to mediation to resolve how non-union employees should be treated.;GOOD FAITH - PENALTY: Respondent not offering during MUCA bargaining to backdate wage increase to same date subsequently offered to non-union employees lawful bargaining tactic not in breach of good faith obligations. However respondent knew what would offer non-union employees and breached good faith obligations under s4(1)(b) and s4(1A)(b) ERA by withholding information during bargaining that misled applicants. Applicants did not prove respondent deliberately attempted to induce applicants’ members to end membership or offered non-union members greater backpay period with intention of inducing employees not to be covered by MUCA. Respondent’s failure to disclose what intended to offer to non-union employees deliberate, serious and sustained. $5,000 penalty appropriate. |
| Result | Applications partially granted ; Orders made ; Penalty – breach of collective employment agreement ($1,250)(payable to first applicant)($1,250)(payable to second applicant)($2,500)(payable to Crown) ; Penalty – breach of good faith obligations ($1,250)(payable to first applicant)($1,250)(payable to second applicant)($2,500)(payable to Crown) ; Costs reserved |
| Main Category | Bargaining |
| Statutes | ERA s4;ERA s4A;ERA s4(1);ERA s4(1)(a);ERA s4(1)(b);ERA s4(1A)(b);ERA s4(2);ERA s4(6);ERA s4(6)(a);ERA s4(6)(b);ERA s9;ERA s9(3);ERA s10;ERA s32;ERA s59B;ERA s59B(6);ERA s63;ERA s63A;ERA s63A(2);ERA s134;ERA s135(2)(b) |
| Cases Cited | Association of University Staff v Vice Chancellor of The University of Auckland [2005] ERNZ 224;National Distribution Union Inc v General Distributors Ltd [2007] ERNZ 120;NZ Meat Workers And Related Trades Union v Taylor Preston Ltd [2009] ERNZ 54;Service & Food Workers Union Nga Ringa Tota Inc v Pacific Flight Catering [2011] NZERA Auckland 23;Service and Food Workers Union Nga Ringa Tota v Sealord Group Ltd [2012] NZEmpC 211;Service and Food Workers Union Inc v Sealord Group Ltd (2003) 7 NZELC 96,927;Taylor Preston Ltd v New Zealand Meat Workers Union and Related Trades Union (2009) 6 NZELR 828;Vector Gas Ltd v Bay Of Plenty Energy Ltd [2010] 2 NZLR 444 |
| Number of Pages | 27 |
| PDF File Link: | 2013_NZERA_Christchurch_41.pdf [pdf 275 KB] |