PAFCO Employees Union v Pacific Fishing Company Ltd [2007] FJAT 81; Award 83 of 2007 (17 December 2007)

THE REPUBLIC OF THE FIJI ISLANDS

NO 83 OF 2007

AWARD OF
THE ARBITRATION TRIBUNAL

IN THE DISPUTE BETWEEN

PAFCO EMPLOYEES UNION

AND

PACIFIC FISHING COMPANY LIMITED

PAFCOEU: Mr T Tokalauvere
PAFCO: Mr G Singh

DECISION

This is a dispute between PAFCO Employees Union (the Union) and Pacific Fishing Company Limited (the Employer) concerning the dismissal of six employees and the appointment of a transport officer without consultation.

A trade dispute was reported by the Union. The report was accepted by the Chief Executive Officer who referred the Dispute to a Disputes Committee.

Subsequently the Minister authorized the Permanent Secretary to refer the Dispute to an Arbitration Tribunal for settlement pursuant to section 5 A (5) (a) of the Trade Disputes Act Cap 97.

The Dispute was referred to the Permanent Arbitrator on 24 May 2007 with the following terms of reference:

"- - - for settlement over the following :

1. the unlawful, unfair and unconstitutional termination of employment of Ms Arieta Vuli on 19th July 2006. The union contends that the grievor be reinstated with full pay and benefits.

2. The unlawful, unfair and unconstitutional termination of employment of Mr Eroni Kotoiwasawasa on 19th June 2006. The union contends that the grievor be reinstated with full pay and benefits.

3. The unlawful, unfair and unconstitutional termination of employment of Mr Semesa Qioniqara and Mr Josua Loatuicama on 19th July 2006. The union contends that the grievors be reinstated with full pay and benefits.

4. The unlawful, unfair and unconstitutional termination of employment of Ms Siteri Waqavou on 19th December 2005. The union contends that the grievor be reinstated with full pay and benefits.

5. The unlawful, unfair and unconstitutional termination of employment of Ms Letila Baleideidei on 16th March 2006. The union contends that the grievor be reinstated with full pay and benefits.

6. The appointment of Mr Koli Niumataiwalu as Transport Officer without consultation with the union. The union contends that Mr Niumataiwalu’s appointment be terminated and that the post should filled in accordance with the collective agreement.

The dispute was listed for a preliminary hearing on 1 June 2007. On that day the parties were directed to file a signed statement of agreed facts within 21 days in relation to Disputes (1) to (5). The parties were directed to file preliminary submissions within 21 days in relation to the sixth Dispute. The Disputes were listed for mention on 29 June 2007.

The parties did not file a signed statement of agreed facts. Instead, the Employer filed preliminary submissions in respect of all six Disputes on 22 June and the Union did likewise on 29 June 2007.

The Disputes were subsequently relisted for mention on 6 July and 12 July 2007.

When the Disputes were called for hearing on 22 August 2007, the Union indicated that, due to a misunderstanding, it was not in a position to proceed and applied for the hearing date to be vacated. The application was granted on terms that the Union pay to the Employer the sum of $843.00 as costs thrown away in respect of six witnesses who were present at the Tribunal to give evidence on behalf of the Employer. The Disputes were relisted for mention on 21 September 2007.

The hearing of the Disputes commenced on 26 November 2007 in Suva. At the start of the proceedings the parties informed the Tribunal that five of the Disputes had been settled. The parties filed a signed agreement dated 21 November 2007 and sought a consent award in terms.

In relation to Dispute number six concerning the appointment of a transport officer, the Union called one and the Employer called two witnesses to give evidence. The parties presented oral closing submissions on 27 November 2007.

This Dispute concerned the appointment of Mr Kolinio Komainalovo (referred to as Koli Niumataiwalu in the Reference) by the Employer pursuant to a Memorandum of Agreement dated 14 August 2006. As the Agreement is central to the Dispute it is appropriate to set out its terms in full:

"An Agreement is made between PACIFIC FISHING COMPANY LIMITED (here-in-after referred to as the COMPANY) as one part and MR KOLINIO KOMAINALOVO (here-in-after referred to as the CONTRACTOR) as the other part as follow:-

1. THAT the Contractor shall be responsible for co-ordinating, organizing and controlling transport runs associated with the operation of the business of the Company.

2. THAT the Contractor shall be responsible for organizing transport particularly for the night shift operations.

3. THAT the Company shall pay the Contractor an equivalent sum of $10,920 (Ten Thousand, nine hundred and twenty dollars) per annum based on five day operations per week.

4. THAT on basis of the equivalent annual sum and the operational days as stated in clause (3) above, the equivalent daily rate payable to the Contractor shall be $42.00 (forty two dollars), payable for the days engaged in organizing the transport during the week.

5. THAT the Contractor shall not be entitled to any form of payment for the days on which he has not been involved in organizing transport, however he will be paid the equivalent payable under clause (4) above for any extra days engaged in organizing the transport in excess of the five days stated in clause (3) above.

6. THAT any payment made by the Company to the Contractor shall be subject to 15% with holding tax."

The Union submitted that the appointment was in breach of clause aa of a Memorandum of Understanding dated 9 December 2003. The Union also submitted that the appointment represented a breach of section 33 (3) of the Constitution.

Clause aa of the Memorandum of Understanding states:

‘All hourly paid employment are frozen and any new recruits will require the union blessing and in line with Board manning approval."

It should be noted that workers employed by the Employer are classified as either permanent wage earners or as temporary wage earners. Clause 1 (c) of the Collective Agreement dated 12 July 2001 states:

"(c) CLASSIFICATION OF WORKERS

(i) Permanent wage earners are those hourly paid employees who are under regular employment with the company.

(ii) Temporary wage earners are those hourly paid workers who are engaged to do the same work as permanent or regular employees but for specific or protracted periods when required by the Company."

It is also worth noting that clause 2 (c) of the Memorandum of Understanding dated 9 December 2003 states:

"The new unskilled rate of $2.75 an hour has already been implemented. The adjustment of skilled rate of $3.50 an hour to be finalized by the committee before implementation."

Mr Komainalovo had previously been employed by the Employer between 1988 and 2004. During that time he worked in various sections of the Employer’s operations. He then obtained employment in Iraq working in transport operations. He returned to Fiji in 2006 and applied to his former employer for work. Following an interview he and the Employer entered into the agreement dated 14 August 2006. Under that agreement Mr Komainalovo took over responsibility for ensuring that the Employer complied with the obligations specified in clause 6 of the Collective Agreement, with particular reference to the transport arrangements for shift workers. Those duties had previously been undertaken by the security personnel provided by Vanua Security.

The evidence established that about three months after Mr Komainalovo’s appointment, a second person was also appointed as a transport officer pursuant to a contract which was similar to Mr Komainalovo’s contract.

The evidence also established that there have been two variations to the agreement. First, at the request of management, Mr Komainalovo agreed to oversee movements at the front gate, although security remained the responsibility of Vanua Security. Secondly, Mr Komainalovo was to perform his contractual functions during the hours of 6.00pm to 6.00am.

The second transport officer was to work 6.00am to 6.00pm.

Mr Komainalovo stated in his evidence that he did not commence employment pursuant to any temporary arrangement before he signed his contract on 14 August 2006.

In this Dispute the Union carried the burden of proof in relation to both a preliminary issue and the alleged breach of the clause in the Memorandum of Understanding.

The Union is required to establish the existence of an agreement which is enforceable by one or both of the parties. Section 34 of the Trade Disputes Act provides, amongst other things, that every collective agreement must be in writing and lodged within 28 days with the Permanent Secretary for registration. Section 34 (1) expressly provides that the requirement for registration also applies to any amendment to the Collective Agreement.

A Collective Agreement is defined in section 2 of the Act so as to include an agreement between a recognized trade union of employees and an employer which prescribes (wholly or partially) terms and conditions of employment.

The Tribunal is satisfied that the Memorandum of Understanding dated 9 December 2003 dealt with issues which related to the terms and conditions of employment and was as a result an amendment to the Collective Agreement dated 12 July 2001. It was an amendment to the Collective Agreement because its provisions either varied or added to the terms and conditions set out in the Collective Agreement. As such it was required to be registered with the Permanent Secretary pursuant to section 34 (1) of the Act. Registration was a legal technical requirement. If the Memorandum of Understanding was not registered, it was unenforceable.

An unenforceable agreement is one which is prima facie a valid contract but which by reason of some technical defect is not capable of being enforced by action by one or both of the parties. If the missing formality can be and is supplied or rectified, the contract becomes enforceable.

This matter was not addressed by the parties by way of evidence or submissions. In the event that the Memorandum of Understanding has been registered in compliance with section 34 of the Act, the Tribunal shall consider briefly the substantive issue concerning the allegation that the Employer has breached clause aa of the Memorandum.

The wording of clause aa is somewhat vague and confusing. Whatever the meaning of the words "will require the union blessing" may be, it was not disputed that the Employer had not communicated with or approached the Union about Mr Komainalovo at any time prior to 14 August 2006.

The requirement to obtain the Union blessing applied to new recruits. The Tribunal is satisfied that the reference to new recruits was a reference to new recruits engaged in hourly paid employment.

After a careful perusal of the Memorandum of Agreement dated 14 August 2006 and after carefully considering the evidence the Tribunal is satisfied that whilst Mr Komainalovo was capable of being regarded as a recruit he was not engaged in hourly paid employment. His contract referred to an annual salary for working five days a week. The contract also provided for a daily rate. There was no reference to hours to be worked or any rate to be paid in respect of hours worked.

As a result the Tribunal has concluded that there was no requirement on the part of the Employer to seek the Union blessing before it entered into the agreement with Mr Komainalovo.

As a result the Employer has not breached clause aa of the Collective Agreement.

As far as the second ground relied upon by the Union is concerned, the Tribunal has concluded that the engagement of Mr Komainalovo pursuant to the agreement dated 14 August 2006 did not amount to a breach of any union member’s constitutional right to fair labour practices.

It should be noted that the concept "fair labour practices" is a broad expression which is not really capable of precise definition. Its meaning certainly goes beyond the right to form and join a trade union and to organize and bargain collectively, as these rights are also expressly provided for in section 33 of the Constitution. In National Education Health and Allied Workers Union –v- University of Cape Town and Others 2003 (3) SAI (cc) at paragraphs 33 and 34 Ngcobo J said:

"The concept of fair labour practices is incapable of precise definition. The problem is compounded by the tension between the interests of the workers and the interests of the employers that is inherent in labour relations. Indeed, what is fair depends upon the circumstances of a particular case and essentially involves a value judgment. It is therefore neither necessary nor desirable to define the concept. - - - - in giving context to this concept the Court and Tribunals all have to seek guidance from domestic and international experience."

The Tribunal is satisfied that the appointment of Mr Komainalovo pursuant to the agreement dated 14 August 2006 was fair as on the evidence Mr Komainalovo had acquired the experience to perform the duties necessary to ensure that the Employer provided the transport services required of it under the Collective Agreement. The Union did not adduce any evidence to establish the appointment was unfair.

AWARD

The Memorandum of Understanding dated 9 December 2003 constituted an amendment to the Collective Agreement and as such was required to be registered with the Permanent Secretary. If it was not registered it is an unenforceable agreement.

Mr Komainalovo was not recruited for hourly paid employment and therefore there was no requirement for the Employer to obtain the Union blessing.

The appointment did not constitute a breach of section 33 (3) of the Constitution.

CONSENT AWARD

In Disputes numbered 1 to 5 in the terms of reference, the Tribunal’s Award is in the terms of the Agreement dated 21 November 2007 filed herein and a copy of which is Attachment A to this Award.

DATED at Suva this 17 day of December 2007.

Mr. W. D. Calanchini
ARBITRATION TRIBUNAL