The High Court of Australia has upheld an earlier decision by the Full Court of the Federal Court that a union that is a registered industrial organisation is entitled to represent the industrial interests of employees who, although eligible to be members of the union in question, have not actually joined it.

What's happened?

Regional Express Holdings Limited (Rex) is a commercial airline company. In September 2014, Rex sent a letter to short-listed cadet pilot program participants suggesting that although the right to accommodation of a particular standard during layovers was provided in the Regional Express Pilots’ Enterprise Agreement 2011, any Rex cadet who attempted to exercise this right would be considered to be ‘totally lacking in integrity’ and not be given a command position. Cadets were requested to provide a written undertaking to this effect to assess ‘how far you are motivated to go above and beyond the call of duty for the Company’.

Although none of the affected cadets were its members, the Australian Federation of Air Pilots (the Federation) applied to the Federal Circuit Court for pecuniary penalty orders, alleging that the letter constituted adverse action, coercion and misrepresentation under the Fair Work Act 2009 (Cth) (FW Act).

In making its application, the Federation relied on section 540(6)(b)(ii) of the FW Act which says that an application for an order in relation to contravention of a civil remedy provision may be made if ‘the industrial association is entitled to represent the industrial interests of the person.’ The Federation contended that as the cadets in question met the Federation’s eligibility requirements, the Federation was entitled to represent their industrial interests.

Rex applied to have the case summarily dismissed on the basis that the Federation did not name the cadets in question and could only act on behalf of current members. Both the application to the Federal Circuit Court and subsequent appeal to the Full Court of the Federal Court were dismissed.

Rex appealed the decision to the High Court.

Non-member representation

The High Court upheld the decision by the Full Court of the Federal Court and dismissed Rex’s appeal, stating that section 540(6)(b)(ii) of the FW Act applies to registered organisations in relation to contraventions which affect ‘a designated class of persons in relation to whom the organisation has industrial coverage’.

The High Court held that the Full Bench of the Federal Court had correctly applied Dunlop Rubber² and that the ‘entitlement to represent should apply to registered organisations in the same way that it applied to registered trade unions (under previous legislation).'

As a possible indicator of future decisions, the High Court also said that the ability to apply for orders may not be limited to unions that are registered organisations but may also apply ‘to other forms of industrial organisation having a real interest in ensuring compliance with civil remedy provisions.’ However, the Court declined to make any finding on this issue.

What this means for employers

This decision confirms that unions that are registered industrial organisations are entitled to commence proceedings against an employer, even if the employees in question are only eligible to join the union and are not currently members.

Employers should be aware that contraventions of the FW Act may be raised by not only employees, but by registered unions, regardless of whether or not any employees are members. Employers should also watch this space to see if the court expands this right to include other industrial bodies, regardless of whether or not they are registered. Though there are not many unregistered unions active in the federal space, the ongoing ‘turf war’ between the SDA and Retail and Fast Food Workers Union is an example of how employers (in one celebrated instance, Coles) can be caught in the crossfire between registered and unregistered unions.