| Restrictions | OK |
|---|---|
| Jurisdiction | Employment Relations Authority - Auckland |
| Reference No | AA 306/08 |
| Hearing date | 11 Aug 2008 |
| Determination date | 26 August 2008 |
| Member | D King |
| Representation | K Beck ; R McIlraith |
| Location | Auckland |
| Parties | Pulp & Paper Industry Council of the Manufacturing and Construction Workers Union & Anor v Norske Skog Tasman Ltd |
| Other Parties | Boylen |
| Summary | DISPUTE - Applicants sought order respondent comply with s69OJ Employment Relations Act 2000 (“ERA”) - Sought order preventing respondent from restructuring until collective employment agreement (“CEA”) contained employment protection provision (“EPP”) - Respondent opposed orders - Applicants claimed effect of s69OJ ERA that EPP required in CEA prior to respondent restructuring - Applicants claimed otherwise employees would be denied right to protection conferred by ERA - Claimed consequence of non-compliance with s69OJ ERA must be compliance order requiring CEA contain EPP before respondent undertook or implemented proposed restructure - Applicant claimed legislative intent clear - Claimed intention of Parliament to ensure employer could not restructure business without affected employees having protection afforded by ERA - Claimed implementing restructuring without EPP not situation that could be rectified by damages - Claimed EPP’s purpose to at least potentially put boundaries around bargain employer able to reach with third party - Applicants claimed failure of legislation to deal with consequence of failure to comply with s69OJ ERA was omission - Applicants submitted omission was ellipsis - Applicants claimed deliberate omission of consequences for failure to comply meant s69OJ ERA of no effect therefore nonsensical - Applicants claimed protection afforded by EPP could not be met by good faith, implied terms, or consultation - Applicants claimed only sensible interpretation that omission of consequences was ellipsis and Authority to fill gap by determining employer could not undertake restructuring without ensuring s69OJ ERA complied with - Respondent claimed CEA did contain EPP - In alternative, claimed ERA silent on consequences of failure to have EPP in employment agreement - Respondent claimed failure lay at feet of both parties and could not have been intended to lead to sanction as stark as prohibition on any action falling within definition of restructuring under s69OH ERA - Alternatively, respondent submitted no compliance order should be made - Parties and Authority accepted proposition that employment agreement need not contain EPP clause if agreement as a whole contains requirement of EPP - Respondent claimed must be presumption against implying obligations into ERA or employment relationships generally which fettered managerial prerogative - Claimed not necessary to imply power to grant compliance order to give effect to objects of Subpart 3 of Part 6A ERA - Respondent claimed no suggestion in objects section that Subpart 3 intended to prohibit employer from restructuring until EPP included in employment agreement - Claimed no credible argument providing sanction intended by Parliament - Claimed even if Parliament intended sanction, not clear what sanction should be - Authority found existing employment agreement did not satisfy statutory requirements - Found legislation placed limits on managerial prerogative - Authority found difficult to conclude Parliament would have intended failure to negotiate EPP would render protection ERA provided nugatory - Found Parliament could not have intended there be no consequences - Authority concluded omission of consequences for failure to have EPP an accidental omission - Found given framework of ERA, its philosophy and history conclusion must be only remedy which could have been intended and was intended is compliance order - Authority ordered parties are to negotiate until such time as s69OJ ERA complied with - Respondent ordered not to implement proposed restructuring until EPP agreed |
| Result | Questions answered in favour of applicants ; Orders made ; Costs reserved |
| Main Category | Dispute |
| Statutes | ERA s3;ERA s54(3)(a)(ii);ERA s65(2)(a)(ii);ERA s69N;ERA s69N(2)(c);ERA s69OH;ERA s69OI;ERA s69OI(1)(a);ERA s69OI(1)(b);ERA s69OI(1)(b)(i);ERA s69OI(1)(b)(ii);ERA s69OI(1)(b)(iii);ERA s69OJ;ERA s69OK;ERA s137(1);ERA s137(2);ERA Part 6A subpart 3;Evidence Amendment Act (No 2) 1980 s34;Interpretation Act 1999 s5(1);Milk Act 1988 |
| Cases Cited | Frucor Beverages Ltd v Rio Beverages Ltd [2001] 2 NZLR 604;Gibbs v Crest Commercial Cleaning Ltd [2005] 1 ERNZ 399;Inco Europe Ltd v First Choice Distribution [2000] 2 All ER 109;Norske Skog Tasman Ltd v Clarke [2004] 1 ERNZ 127;Northland Milk Vendors Association Inc v Northern Milk Ltd [1988] 1 NZLR 530;Securities Commission v Midavia Rail Investments BVBA [2005] 3 NZLR 433;Service & Food Workers’ Union Inc v Vice-Chancellor of the University of Otago [2003] 2 ERNZ 156 |
| Number of Pages | 20 |
| PDF File Link: | aa 306_08.pdf [pdf 72 KB] |