Building Construction, Timber and Allied Workers Union v Fiji Forest Industries Ltd [2004] FJAT 19; Award 12 of 2004 (29 April 2004)

THE REPUBLIC OF THE FIJI ISLANDS

12 of 2004

AWARD OF
THE ARBITRATION TRIBUNAL

IN THE DISPUTE BETWEEN

BUILDING CONSTRUCTION, TIMBER AND ALLIED WORKERS UNION

AND

FIJI FOREST INDUSTRIES LIMITED

BCTAWU: Mr F Anthony
FFI: Mr W Sorby

DECISION

This is a trade dispute between the Building Construction, Timber and Allied Workers Union (the "Union") and Fiji Forest Industries Limited (the "Employer") concerning the standing down of workers without pay in 2003 and whether such action was in breach of clauses 2.2 and 4.9 of the Collective Agreement.

A trade dispute was reported by the Union to the Permanent Secretary on 6 May 2003 and was accepted on 4 June 2003. The Permanent Secretary referred the dispute to a Disputes Committee which was not able to reach a consensus resolution. Consequently, the Minister authorized the Permanent Secretary to refer the dispute to the Arbitration Tribunal for settlement pursuant to section 5A (5) (a) of the Trade Disputes Act Cap 97.

The Dispute was referred to the Permanent Arbitrator on 2 September 2003 with the following terms of reference:

"..... for settlement over the company’s decision to stand down 117 workers from work without pay for the periods 12/03/03 to 01/04/03 and 18/03/03 to 31/03/03.

The Union claims that the Employer has breached clauses 2.2 and 4.9 of the Collective Agreement and demands that the workers involved should be compensated accordingly".

The Dispute was listed for preliminary hearing on 2 October 2003. Mr W Sorby appeared for the Employer but there was no appearance by or on behalf of the Union. The parties were directed to file preliminary submissions by 14 November and the Dispute was listed for final hearing on 25 November 2003. By consent that date was vacated and the Dispute was relisted for final hearing on 11 February 2004.

Both parties filed preliminary and final submissions. At the hearing on 11 February 2004 the Union called Mr Sayed Farouk who is the Union’s chief site delegate. The Employer called Ratu Tomasi Bonaveidogo, the General Manager Operations and Mr Tabua Kaukimoce, the Personnel Manager.

The Dispute arose as a result of a decision taken by the Employer to stand down workers in the log debarking, lathe, continuous drier and sawmill sections between 12 March and 1 April 2003. During this period a total of 117 workers were stood down at different times for different periods. The fact that the workers were stood down is not in dispute.

The Union claims that the stand down of the workers was in contravention of clauses 2.2 and 4.9 of the Collective Agreement and was therefore improper. As the Union is alleging an improper stand down, it carries the onus of proving that allegation.

The relevant part of clause 4.9 of the Collective Agreement states that:

"(a) ...........

"(b) ........

"(c) Before considering and implementing this option to stand down or lay off employees, the Employer should explore all other possible alternatives with a view to retaining employees in paid employment. In any case use should be made of para.2.2 of this Agreement before implementing such stand downs a lay offs".

There is in clause 4.9 (c) a reference to clause 2.2 of the same Agreement. That clause provides:

"2.2 Joint Consultation

A special committee consisting of two representatives of the Employer and two internally elected employees as Union representatives may be authorized to discuss any matters relating to the Agreement.

Any alteration to the Agreement that may eventually become necessary as a result of such discussions and consultation should be co-ordinated with the Union’s Malau President and General Secretary.

Other matters of concern particularly including safety and welfare may be discussed and decided upon at this level provided always that in no case should agreements reached encroach on the authority and validity of the Agreement unless such relate to matters not specifically or sufficiently covered.

Such joint consultation may allow for the inclusion of employees duly co-opted who are not necessarily elected officials".

It should be noted that whenever in the past clause 2.2 has been activated, its implementation was flexible.

The Union claims that the Employer did not consult the Union prior to standing down the workers from their jobs and thereby failed to follow the procedure outlined in clauses 2.2 and 4.9.

The Union claims that clause 4.9 (c) requires the employer to consider all other possible alternatives and also requires the employer to use clause 2.2 before implementing a stand down. It claims that the purpose of the two clauses is to ensure that there exists a procedure to stand down workers and that such stand down is not a unilateral action of the employer.

The Union also submits that the word "should" means "must" as the intent of the clauses is to lay down a procedure to be followed in the event that a stand down cannot be avoided.

The Union claims that the joint consultation procedure set out in clause 2.2 did not take place in relation to the stand down. The Union relies on correspondence from the Employer to the Union in 1999 to support its submission that consultation took place between the parties before a stand down had been implemented in that year. As noted the evidence suggested that in the past clause 2.2 had been followed with some degree of flexibility.

The Union points out that the Committee referred to in clause 2.2 was not permanent but was ad hoc and consisted of personnel who had an interest in or were involved in the particular issue under discussion.

The Union claims that its chief site delegate, Mr Farouk, met in 2003 with both the Personnel Officer and the new Chief Executive Officer on separate occasions. Mr Farouk gave evidence that at the meeting with the Personnel Officer, options were discussed to avert a stand down. At the later meeting with the new Chief Executive, Mr Farouk was briefed on the company’s performance and future plans. Mr Farook maintained that a stand down was not discussed with him prior to implementation.

The Union rejects the Employer’s claim that it did not know who to approach during or after amalgamation. It also says that even if there was some doubt, management could have approached Mr Farouk who was still employed by the Company and who was well known as a Union official.

As an alternative position, the Union submits that even if there were no provisions in the Collective Agreement on consultation with the Union, a stand down is a serious matter which good industrial relations practice would dictate a need for consultation. The Union no doubt would adopt this argument as an alternative to a finding that the word "should" in clause 4.9 (c) does not impose a mandatory requirement to use clause 2.2.

The crux of the Union’s submission is that there was no consultation or meeting concerning the stand down implemented by the Employer between 12 March and 1 April 2003. Such consultation or meeting is either a mandatory requirement under the Collective Agreement or alternatively, a basic requirement of good industrial relations practice and one which a reasonable Employer would follow.

The Employer maintains that the word "should" in clause 4.9 (c) does not impose a mandatory obligation to use the procedure in clause 2.2 before proceeding to implement a stand down. The Employer adds that it cannot be considered to be in breach of a clause in the Collective Agreement if there is no legal obligation to comply.

The Employer goes further and says that although there was no obligation to do so, it made every effort to follow the procedures set out in the Collective Agreement.

The Employer says that management had discussions with affected employees on 3 and 4 March 2003. It says further that Mr Farouk was consulted on the stand down by the new Chief Executive Officer, Mr Chang, during the course of their meeting on 27 February 2003. The Employer relies on a copy of a letter dated 3 March 2004 from the Chief Executive Officer in support of its contention that Mr Farouk had been consulted in relation to standing down workers due to a log shortage.

The Employer maintains that it had implemented alternative measures in an effort to avoid a stand down. The problem was related to a shortage of hardwood logs which in turn had been caused by the difficulty of accessing timber due to a prolonged spell of adverse weather conditions.

The first issue which requires determination is the effect of clause 4.9 (c) of the Collective Agreement. The word "should" appears twice in the clause.

The Shorter Oxford English Dictionary (Third Edition) states that "should" is the past tense of "shall". Included in its many uses "should" is used in "statements of duty, obligation or propriety". In the same sense "shall" when used in the third person is used to express "the speaker’s determination to bring about some action, event or state of things in the future".

In Black’s Law Dictionary (6th Edition) "should" is defined as follows:

"The past tense of shall, ordinarily implying duty or obligation; although usually no more than an obligation of propriety or expediency, or a moral obligation, thereby distinguishing it from "ought". It is not normally synonymous with "may" and although often interchangeable with the word "would", it does not ordinarily express certainty as "will" sometimes does".

Any comments made by the Tribunal during the course of the hearing which are inconsistent with the dictionary meaning should have been addressed in the parties’ submissions.

It should be noted that clause 4.9 specifically deals with stand downs. The implementation of a stand down not only disrupts the contract of employment but more importantly has serious financial and social consequences for the workers concerned. It is a significant industrial relations step and because of its consequences is not to be taken lightly.

In considering the definitions contained in the dictionaries and in the context of a significant industrial relations issue, the Tribunal considers that the word "should" as it appears in clause 4.9 (c) imposes an obligation on the Employer to use clause 2.2 in the event that a stand down cannot be avoided.

In the event that this opinion is not correct, the Tribunal has no hesitation in determining that in the context of a possible stand down of workers, a reasonable employer acting prudently would consult with the relevant union or directly with the affected workers before implementing a stand down.

The next question for determination is whether clause 2.2 was used. The Employer maintains that it has been used. It relies first on meetings held with affected workers on 3 and 4 March 2003. The evidence on these meetings was given by Mr Kaukimoce. He stated that the committee contemplated by clause 2.2 was not activated in March 2003 because of a union amalgamation. It would appear that the meetings and discussions which took place on 3 and 4 March involved supervisors being briefed and then briefing their sections on the measures to be introduced because of the log shortage. These measures included reduced working hours, shift changes and on/off rosters. Even if the possibility of a stand down was included in these briefings, the Tribunal does not consider that these meetings and discussions satisfied either the express requirements or the spirit of clause 2.2.

The Employer also relies on a meeting between Mr Farouk and Mr Chang on 27 February 2003. Reference has already been made to a copy letter dated 3 March 2004 signed by Mr Chang, the Chief Executive Officer of the Employer. This letter is addressed ‘To Whom It Concerns". The letter purports to represent Mr Chang’s recollection of what transpired at the meeting in his office with Mr Farouk on 27 February 2003.

The Tribunal attaches no weight to the letter. Mr Chang was not called to give evidence at the hearing. The letter bears a date which is after the hearing had concluded. Neither the contents nor the signature have been adopted by Mr Chang under oath.

The Tribunal accepts the only sworn evidence on what transpired at that meeting. Mr Farouk gave that evidence and he maintained that the question of a stand down was not discussed.

As a result the Tribunal has concluded that the Employer has not used clause 2.2 as was required pursuant to clause 4.9 (c).

However that is not the end of the matter as two comments need to be made concerning the Union’s position. The first is that the Tribunal accepts that the Union and Mr Farouk in particular must have been aware by March 2003 of the predicament facing the Employer.

The probability of a stand down being implemented was increasing as the log shortage continued and the alternative measures which had been implemented failed to alleviate the Employer’s financial situation.

Secondly, the Union’s concern in this dispute would appear to relate more to the failure of the Employer to follow procedure than the stand down itself. At page 6 of the Union’s final submission the following passage appears:

"The union does not contest the issue of short supply of logs or the financial situation of the Company. The Union has demonstrated good understanding of the Company’s predicament on many instances and evidence on this was adduced during the hearing. The Union had at no time unreasonably disputed the employer’s intention to stand down workers or other cost cutting measures agreed between the parties. All the Union is seeking is that proper accepted procedures are followed and in this instance there has been evidence that the procedure was not followed".

Under the circumstances the Tribunal does not consider it appropriate to make any award by way of compensation.

There is the further issue of section 16 of the Employment Act Cap.92. Whilst not completely satisfied that a consideration of section 16 comes within the terms of reference, the Tribunal makes this brief comment. Section 16 requires the employer to provide the employee with work in accordance with the contract, subject to some qualifications which are not relevant. The terms of the Collective Agreement form part of the contract of employment. If the Collective Agreement contains provisions relating to the implementation of a stand down then by implication the contract of employment contains a stand down clause. To that extent it is the Tribunal’s opinion that a stand down implemented in good faith although not in accordance with a procedure set out in the agreement does not result in any entitlement under section 16 of the Employment Act Cap.92.

AWARD

The Tribunal declares that the Employer did not follow the procedures set out in clauses 4.9 and 2.2 of the Collective Agreement when it stood down 117 workers during the period 12 March – 1 April 2003.

The Tribunal declines to make any Award of compensation as the need to implement the stand down is not disputed.

DATED at Suva this 29^th day of April 2004.

Mr W D Calanchini
ARBITRATION TRIBUNAL