The Facts

The employer, Belandra, operated a beef slaughtering operation at Brooklyn.  Other companies in the corporate group operated other parts of the abattoir, such as boning and mutton processing.  The Union had a certified agreement with Belandra and had been active on the site.

In June 2001 a fire destroyed the abattoir.  All the workers, other than those on WorkCover, were terminated 'on the basis they would be re-employed'. 

In September 2001 the main directors of Belandra, Joe Catalfamo and Gilbert Cabral, decided that Belandra would not re-employ the workers.  Instead they set up another company, TGS, to 'provide meat processing services' to Belandra.  TGS then engaged another company to manage its processing operations.  That company, Larberg, was set up by one of the Belandra's former managers, and employed the other former managers.  Larberg in turn engaged a labour-hire company, ESP Tecforce, to provide it with labour. The Tecforce workers were required to sign AWAs. 

The Union sued Belandra and the other companies, alleging the new structure had been set up to avoid having to employ Union members, and avoid having to apply Belandra's certified agreement. 

The Decision

On 29 August 2003 the Federal Court gave its decision, finding that:

(1)                    although Belandra had terminated most of its employees in June 2001, it had not terminated its employees on WorkCover and so it was still an "employer" for the purposes of the "freedom of association" provisions of the Workplace Relations Act.  It was also "usually an employer", which was enough for the purposes of the Act;

(2)                    the new corporate structure involved an alteration of the former workers' position "to their prejudice", and also involved Belandra "refusing to employ" them;

(3)                    discrimination against workers because they are "members" of a union includes discrimination for the reason that their membership enables the union to be active in the workplace.

The Court held that the restructuring was indeed carried out for the "proscribed purposes" of avoiding having to employ Union members, and avoiding the certified agreement. 

The Court referred in particular to the evidence given by Joe Catalfamo, and concluded that:

"Mr Catalfamo was content to engage with [the Union] only if it cooperated with him, and if it accepted his vision of change without question.  Otherwise, he was not prepared to have anything to do with [the Union].  His reference to his wish to 'run the business' meant that he wanted to be able to run the business free of the constraint of the [certified] agreement, and free of the need to deal with [the Union]."

Penalties

The Court has so far only made declarations that Belandra contravened the Workplace Relations Act when it decided to carry out the restructure.  It has not yet imposed any penalties on the company or ordered that any compensation be paid to the former Belandra workers (such as backpayments of the difference between the AWA wages and the wages that would have been paid under the Belandra certified agreement).  The case will be back in Court on 26 September 2003, to fix a timetable for a hearing into those questions.

Appeal

The Union believes there is every likelihood the Company will appeal. Our advice is that if this happens it is unlikely to be heard before early next year and that if penalties and/or compensation are awarded as a result of the proceedings on 26 September, that award would be 'stayed' until the appeal is determined.

It may well be that Justice North orders the parties back into mediation, and on that basis the Union would be seeking agreement about employment terms and conditions into the future to cover all the workers at Kyle Road and Industry Park Drive if there is a resumption of work there.

Move to Brooklyn

The Union notes that the Company has applied to terminate the smallstock (Belandra Trading) Agreement.  Our view is that this is indicative of a move back to Brooklyn in the near future.  We will oppose this application on the basis that we believe that the Court's decision last Friday will flow through to the smallstock employees on application back to the Federal Court.  We are in the process of making this application.

Union Members

It should be noted that the decision applies only to members of the Union.  Members need to be aware that they may have to provide details of their earnings since July last year either at Kyle Road or elsewhere if there is a determination that any compensation applies.

This newsletter will be distributed to all ex Belandra employees who have remained Union members and kept their addresses etc. up to date.